EXHIBIT 1.1
[NUMBER OF SHARES]
XXXX.XXX, INC.
SERIES A COMMON STOCK
UNDERWRITING AGREEMENT
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_______ __, 0000
XX Xxxxx Securities Corporation
Xxxx Xxxxxxxx Incorporated
U.S. Bancorp Xxxxx Xxxxxxx Inc.
Xxxxxxx Xxxxx & Company, L.L.C.
As Representatives of the several Underwriters
c/o XX Xxxxx Securities Corporation
Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
1. INTRODUCTORY. XXXX.xxx, Inc., a Delaware corporation (the "Company),
proposes to sell, pursuant to the terms of this Agreement, to the several
underwriters named in Schedule A hereto (the "Underwriters," or, each, an
"Underwriter"), an aggregate of ___ shares of Series A Common Stock, $0.001 par
value (the "Common Stock") of the Company. The aggregate of ___ shares so
proposed to be sold is hereinafter referred to as the "Firm Stock". The Company
also proposes to sell to the Underwriters, upon the terms and conditions set
forth in Section 3 hereof, up to an additional ___ shares of Common Stock (the
"Optional Stock"). The Firm Stock and the Optional Stock are hereinafter
collectively referred to as the "Stock". XX Xxxxx Securities Corporation
("XX Xxxxx"), Xxxx Xxxxxxxx Incorporated, U.S. Bancorp Xxxxx Xxxxxxx Inc. and
Xxxxxxx Xxxxx & Company, L.L.C. are acting as representatives of the several
Underwriters and in such capacity are hereinafter collectively referred to as
the "Representatives."
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents and
warrants to, and agrees with, the several Underwriters that:
(a) A registration statement on Form S-1 (File No. 333-96099) (the "Initial
Registration Statement") in respect of the Stock 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, 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
"Securities Act") and the rules and regulations (the "Rules and
Regulations") of the Commission thereunder, which became effective upon
filing, no other document with respect to the Initial Registration
Statement 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 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, 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 the information contained in the form of
final prospectus filed with the Commission pursuant to Rule 424(b) under
the Securities Act and deemed by virtue of Rule 430A under the Securities
Act to be part of the Initial Registration Statement at the time it was
declared 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 Statements"; and such
final prospectus, in the form first filed pursuant to Rule 424(b) under the
Securities Act, is hereinafter called the "Prospectus". No document has
been or will be prepared or distributed in reliance on Rule 434 under the
Securities Act. No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission.
(b) The Registration Statement conforms (and the Rule 462(b) Registration
Statement, if any, the Prospectus and any amendments or supplements to
either of the Registration Statements or 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 Securities Act
and the Rules and Regulations and do not and will not, as of the applicable
effective date (as to the Registration Statements and any amendment
thereto) and as of the applicable filing date (as to the Prospectus and any
amendment or supplement thereto) 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; provided, however,
that the foregoing representations and warranties shall not apply to
information contained in or omitted from the Registration Statements or the
Prospectus or any such amendment or supplement thereto in reliance upon,
and in conformity with, written information furnished to the Company
through the Representatives by or on behalf of any Underwriter specifically
for inclusion therein.
(c) The Company and its subsidiary (as defined in Section 14) have been duly
incorporated and are validly existing as corporations in good standing
under the laws of their respective jurisdictions of incorporation, are duly
qualified to do business and are in good standing as foreign corporations
in each jurisdiction in which their respective ownership or lease of
property or the conduct of their respective businesses requires such
qualification, and have all power and authority necessary to own or hold
their respective properties and to conduct the businesses in which they are
engaged, except where the failure to so qualify or have such power or
authority would not have, singularly or in the aggregate, a material
adverse effect on the condition (financial or otherwise), results of
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operations, business or prospects of the Company and its subsidiary, taken
as a whole (a "Material Adverse Effect"). The Company owns or controls,
directly or indirectly, only the following corporations, associations or
other entities: Talkpoint Communications (Delaware), Inc.
(d) This Agreement has been duly authorized, executed and delivered by the
Company.
(e) The Stock to be issued and sold by the Company to the Underwriters
hereunder has been duly and validly authorized and, when issued and
delivered against payment therefor as provided herein, will be duly and
validly issued, fully paid and nonassessable and free of any preemptive or
similar rights and will conform to the description thereof contained in the
Prospectus.
(f) 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 thereof contained in the
Prospectus.
(g) All the outstanding shares of capital stock of the subsidiary of the
Company have been duly authorized and validly issued, are fully paid and
nonassessable and, except to the extent set forth in the Prospectus, are
owned by the Company directly, free and clear of any claim, lien,
encumbrance, security interest, restriction upon voting or transfer or any
other claim of any third party.
(h) The execution, delivery and performance of this Agreement by the Company
and the consummation of the transactions contemplated hereby 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 its subsidiary is a party or by which the Company or its
subsidiary is bound or to which any of the property or assets of the
Company or its subsidiary is subject, nor will such actions result in any
violation of the provisions of the charter or by-laws of the Company or its
subsidiary or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or its
subsidiary or any of their properties or assets.
(i) Except for the registration of the Stock under the Securities Act and such
consents, approvals, authorizations, registrations or qualifications as may
be required under the Exchange Act and applicable state securities laws in
connection with the purchase and distribution of the Stock by the
Underwriters, no consent, approval, authorization or order of, or filing or
registration with, any such court or governmental agency or body is
required for the execution, delivery and performance of this Agreement by
the Company and the consummation of the transactions contemplated hereby.
(j) PricewaterhouseCoopers LLP , who have expressed their opinions on the
audited financial statements included in the Registration Statements and
the Prospectus are independent public accountants as required by the
Securities Act and the Rules and Regulations.
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(k) The financial statements, together with the related notes, included in the
Prospectus and in each Registration Statement fairly present the financial
position and the results of operations and changes in financial position of
the Company and its consolidated subsidiary at the respective dates or for
the respective periods therein specified. Such statements and related
notes have been prepared in accordance with generally accepted accounting
principles applied on a consistent basis except as may be set forth in the
Prospectus.
(l) Neither the Company nor its subsidiary has sustained, since the date of the
latest audited financial statements included in the Prospectus, any
material loss or interference with its business from fire, explosion, flood
or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as
set forth or contemplated in the Prospectus; and, since such date, there
has not been any change in the capital stock or long-term debt of the
Company or its subsidiary or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the business, general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiary taken as a whole, otherwise than as set forth or contemplated in
the Prospectus.
(m) Except as set forth in the Prospectus, there is no legal or governmental
proceeding pending to which the Company or its subsidiary is a party or of
which any property or assets of the Company or its subsidiary is the
subject which, singularly or in the aggregate, if determined adversely to
the Company or its subsidiary, might have a Material Adverse Effect or
would prevent or adversely affect the ability of the Company to perform its
obligations under this Agreement; and to the best of the Company's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others.
(n) Neither the Company nor its subsidiary (i) is in violation of its charter
or by-laws, (ii) is in default in any respect, and no event has occurred
which, with notice or lapse of time or both, would constitute such a
default, in the due performance or observance of any term, covenant or
condition contained in any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which it is a party or by
which it is bound or to which any of its property or assets is subject or
(iii) is in violation in any respect of any law, ordinance, governmental
rule, regulation or court decree to which it or its property or assets may
be subject except any violations or defaults which, singularly or in the
aggregate, would not have a Material Adverse Effect.
(o) The Company and its subsidiary possess all licenses, certificates,
authorizations and permits issued by, and have made all declarations and
filings with, the appropriate state, federal or foreign regulatory agencies
or bodies which are necessary or desirable for the ownership of their
respective properties or the conduct of their respective businesses as
described in the Prospectus except where any failures to possess or make
the same,
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singularly or in the aggregate, would not have a Material Adverse Effect,
and the Company has not received notification of any revocation or
modification of any such license, authorization or permit and has no reason
to believe that any such license, certificate, authorization or permit will
not be renewed.
(p) Neither the Company nor its subsidiary is or, after giving effect to the
offering of the Stock and the application of the proceeds thereof as
described in the Prospectus will become an "investment company" within the
meaning of the Investment Company Act of 1940, as amended and the rules and
regulations of the Commission thereunder.
(q) Neither the Company nor any of its officers, directors or affiliates has
taken or will take, directly or indirectly, any action designed or intended
to stabilize or manipulate the price of any security of the Company, or
which caused or resulted in, or which might in the future reasonably be
expected to cause or result in, stabilization or manipulation of the price
of any security of the Company.
(r) The Company and its subsidiary own or possess the right to use all patents,
trademarks, trademark registrations, service marks, service xxxx
registrations, trade names, copyrights, licenses, inventions, trade secrets
and rights described in the Prospectus as being owned by them for the
conduct of their respective businesses, and the Company is not aware of any
claim to the contrary or any challenge by any other person to the rights of
the Company and its subsidiary with respect to the foregoing. The
Company's business as now conducted and as proposed to be conducted does
not and will not infringe or conflict with any patents, trademarks, service
marks, trade names, copyrights, trade secrets, licenses or other
intellectual property or franchise right of any person. Except as
described in the Prospectus, no claim has been made against the Company
alleging the infringement by the Company of any patent, trademark, service
xxxx, trade name, copyright, trade secret, license in or other intellectual
property right or franchise right of any person.
(s) The Company and its subsidiary have good and marketable title in fee simple
to, or have valid rights to lease or otherwise use, all items of real or
personal property which are material to the business of the Company and its
subsidiary taken as a whole, in each case free and clear of all liens,
encumbrances, claims and defects that may result in a Material Adverse
Effect.
(t) No labor disturbance by the employees of the Company or its subsidiary
exists or, to the best of the Company's knowledge, is imminent which might
be expected to have a Material Adverse Effect. The Company is not aware
that any key employee or significant group of employees of the Company or
its subsidiary plans to terminate employment with the Company or such
subsidiary.
(u) No "prohibited transaction" (as defined in Section 406 of the Employee
Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder ("ERISA"), or Section
4975 of the Internal Revenue Code of 1986, as amended from time to time
(the "Code")) or "accumulated funding deficiency" (as defined in Section
302 of ERISA) or any of the events set forth
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in Section 4043(b) of ERISA (other than events with respect to which the
30-day notice requirement under Section 4043 of ERISA has been waived) has
occurred with respect to any employee benefit plan which could have a
Material Adverse Effect; each employee benefit plan is in compliance in all
material respects with applicable law, including ERISA and the Code; the
Company has not incurred and does not expect to incur liability under Title
IV of ERISA with respect to the termination of, or withdrawal from, any
"pension plan"; and each "pension plan" (as defined in ERISA) for which the
Company would have any liability that is intended to be qualified under
Section 401(a) of the Code is so qualified in all material respects and
nothing has occurred, whether by action or by failure to act, which could
cause the loss of such qualification.
(v) There has been no storage, generation, transportation, handling, treatment,
disposal, discharge, emission, or other release of any kind of toxic or
other wastes or other hazardous substances by, due to, or caused by the
Company or its subsidiary (or, to the best of the Company's knowledge, any
other entity for whose acts or omissions the Company or its subsidiary is
or may be liable) upon any of the property now or previously owned or
leased by the Company or its subsidiary, or upon any other property, in
violation of any statute or any ordinance, rule, regulation, order,
judgment, decree or permit or which would, under any statute or any
ordinance, rule (including rule of common law), regulation, order,
judgment, decree or permit, give rise to any liability, except for any
violation or liability which would not have, singularly or in the aggregate
with all such violations and liabilities, a Material Adverse Effect; there
has been no disposal, discharge, emission or other release of any kind onto
such property or into the environment surrounding such property of any
toxic or other wastes or other hazardous substances with respect to which
the Company or its subsidiary have knowledge, except for any such disposal,
discharge, emission, or other release of any kind which would not have,
singularly or in the aggregate with all such discharges and other releases,
a Material Adverse Effect.
(w) The Company and its subsidiary each (i) have filed all necessary federal,
state and foreign income and franchise tax returns, (ii) have paid all
federal, state, local and foreign taxes due and payable for which it is
liable, and (iii) do not have any tax deficiency or claims outstanding or
assessed or, to the best of the Company's knowledge, proposed against it
which could reasonably be expected to have a Material Adverse Effect.
(x) The Company and its subsidiary carry, or are covered by, insurance in such
amounts and covering such risks as is adequate for the conduct of their
respective businesses and the value of their respective properties and as
is customary for companies engaged in similar businesses in similar
industries.
(y) The Company and its subsidiary maintain a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions
are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (iii)
access to assets is permitted only in accordance with management's general
or specific authorization; and (iv) the recorded accountability for assets
is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
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(z) The minute books of the Company and its subsidiary have been made available
to the Underwriters and counsel for the Underwriters, and such books (i)
contain a complete summary of all meetings and actions of the directors and
shareholders of the Company and its subsidiary since the time of its
respective incorporation through the date of the latest meeting and action,
and (ii) accurately, in all material respects, reflect all transactions
referred to in such minutes.
(aa) There is no franchise, lease, contract, agreement or document required by
the Securities Act or by the Rules and Regulations to be described in the
Prospectus or to be filed as an exhibit to the Registration Statements
which is not described or filed therein as required; and all descriptions
of any such franchises, leases, contracts, agreements or documents
contained in the Registration Statements are accurate and complete
descriptions of such documents in all material respects.
(bb) No relationship, direct or indirect, exists between or among the Company on
the one hand, and the directors, officers, stockholders, customers or
suppliers of the Company on the other hand, which is required to be
described in the Prospectus and which is not so described.
(cc) No person or entity has the right to require registration of shares of
Common Stock or other securities of the Company because of the filing or
effectiveness of the Registration Statements or otherwise, except for
persons and entities who have expressly waived such right or who have been
given proper notice and have failed to exercise such right within the time
or times required under the terms and conditions of such right.
(dd) Neither the Company nor its subsidiary own any "margin securities" as that
term is defined in Regulations G and U of the Board of Governors of the
Federal Reserve System (the "Federal Reserve Board"), and none of the
proceeds of the sale of the Stock will be used, directly or indirectly, for
the purpose of purchasing or carrying any margin security, for the purpose
of reducing or retiring any indebtedness which was originally incurred to
purchase or carry any margin security or for any other purpose which might
cause any of the Securities to be considered a "purpose credit" within the
meanings of Regulation G, T, U or X of the Federal Reserve Board.
(ee) Neither the Company nor its subsidiary is a party to any contract,
agreement or understanding with any person that would give rise to a valid
claim against the Company or the Underwriters for a brokerage commission,
finder's fee or like payment in connection with the offering and sale of
the Stock.
(ff) No forward-looking statement (within the meaning of Section 27A of the
Securities Act and Section 21E of the Exchange Act) contained in the
Prospectus has been made or reaffirmed without a reasonable basis or has
been disclosed other than in good faith.
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(gg) Neither of the Company or its subsidiary does business with the government
of Cuba or with any person or affiliate located in Cuba within the meaning
of Florida Statutes Section 517.075.
(hh) The Company has reviewed its operations and that of its subsidiary and any
third parties with which the Company or its subsidiary has a material
relationship to evaluate the extent to which the business or operations of
the Company or its subsidiary will be affected by the Year 2000 Problem.
As a result of such review, the Company has no reason to believe, and does
not believe, that the Year 2000 Problem will have a Material Adverse
Effect. 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.
(ii) The Stock has been approved for quotation subject to notice of issuance on
the NASDAQ Stock Market's National Market System.
3. PURCHASE SALE AND DELIVERY OF OFFERED SECURITIES. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company agrees to sell to each
Underwriter, and each Underwriter agrees, severally and not jointly, to purchase
from the Company that number of shares of Firm Stock (rounded up or down, as
determined by XX Xxxxx in its discretion, in order to avoid fractions) obtained
by multiplying ___ shares of Firm Stock by a fraction the numerator of which is
the number of shares of Firm Stock set forth opposite the name of such
Underwriter in Schedule A hereto and the denominator of which is the total
number of shares of Firm Stock.
The purchase price per share to be paid by the Underwriters to the Company
for the Stock will be $___ per share (the "Purchase Price").
The Company will deliver the Firm Stock to the Representatives for the
respective accounts of the several Underwriters (in the form of definitive
certificates, issued in such names and in such denominations as the
Representatives may direct by notice in writing to the Company given at or prior
to 12:00 Noon, New York time, on the second full business day preceding the
First Closing Date (as defined below) against payment of the aggregate Purchase
Price therefor by wire transfer to an account at a bank acceptable to XX Xxxxx,
payable to the order of the Company, all at the offices of __________. Time
shall be of the essence, and delivery at the time and place specified pursuant
to this Agreement is a further condition of the obligations of each Underwriter
hereunder. The time and date of the delivery and closing shall be at 10:00
A.M., New York time, on April __, 2000 , in accordance with Rule 15c6-1(c) of
the Exchange Act. The time and date of such payment and delivery are herein
referred to as the "First Closing Date". The First Closing Date and the
location of delivery of, and the form of payment for, the Firm Stock may be
varied by agreement between the Company and XX Xxxxx.
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The Company shall make the certificates for the Stock available to the
Representatives for examination on behalf of the Underwriters in New York,
New York at least twenty-four hours prior to the First Closing Date.
For the purpose of covering any over-allotments in connection with the
distribution and sale of the Firm Stock as contemplated by the Prospectus, the
Underwriters may purchase all or less than all of the Optional Stock. The price
per share to be paid for the Optional Stock shall be the Purchase Price. The
Company agrees to sell to the Underwriters the number of shares of Optional
Stock specified in the written notice by XX Xxxxx described below and the
Underwriters agree, severally and not jointly, to purchase such shares of
Optional Stock. Such shares of Optional Stock shall be purchased from the
Company for the account of each Underwriter in the same proportion as the number
of shares of Firm Stock set forth opposite such Underwriter's name bears to the
total number of shares of Firm Stock (subject to adjustment by XX Xxxxx to
eliminate fractions). The option granted hereby may be exercised as to all or
any part of the Optional Stock at any time, and from time to time, not more than
thirty (30) days subsequent to the date of this Agreement. No Optional Stock
shall be sold and delivered unless the Firm Stock previously has been, or
simultaneously is, sold and delivered. The right to purchase the Optional Stock
or any portion thereof may be surrendered and terminated at any time upon notice
by XX Xxxxx to the Company.
The option granted hereby may be exercised by written notice being given to
the Company by XX Xxxxx setting forth the number of shares of the Optional Stock
to be purchased by the Underwriters and the date and time for delivery of and
payment for the Optional Stock. Each date and time for delivery of and payment
for the Optional Stock (which may be the First Closing Date, but not earlier) is
herein called the "Option Closing Date" and shall in no event be earlier than
two (2) business days nor later than five (5) business days after written notice
is given. The Option Closing Date and the First Closing Date are herein called
the "Closing Dates".
The Company will deliver the Optional Stock to the Underwriters (in the
form of definitive certificates, issued in such names and in such denominations
as the Representatives may direct by notice in writing to the Company given at
or prior to 12:00 Noon, New York time, on the second full business day preceding
the Option Closing Date against payment of the aggregate Purchase Price therefor
in federal (same day) funds by certified or official bank check or checks or
wire transfer to an account at a bank acceptable to XX Xxxxx payable to the
order of the Company all at the offices of _________. Time shall be of the
essence, and delivery at the time and place specified pursuant to this Agreement
is a further condition of the obligations of each Underwriter hereunder. The
Company shall make the certificates for the Optional Stock available to the
Representatives for examination on behalf of the Underwriters in New York, New
York not later than 10:00 A.M., New York Time, on the business day preceding the
Option Closing Date. The Option Closing Date and the location of delivery of,
and the form of payment for, the Optional Stock may be varied by agreement
between the Company and XX Xxxxx.
The several Underwriters propose to offer the Stock for sale upon the terms
and conditions set forth in the Prospectus.
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4. FURTHER AGREEMENTS OF THE COMPANY. The Company agrees with the several
Underwriters that:
(a) The Company will prepare the Rule 462(b) Registration Statement, if
necessary, in a form approved by the Representatives and file such Rule
462(b) Registration Statement with the Commission on the date hereof;
prepare the Prospectus in a form approved by the Representatives and file
such Prospectus pursuant to Rule 424(b) under the Securities Act not later
than the second business day following the execution and delivery of this
Agreement; make no further amendment or any supplement to the Registration
Statements or to the Prospectus, advise the Representatives, promptly after
it receives notice thereof, of the issuance by the Commission of any stop
order or of any order preventing or suspending the use of any Preliminary
Prospectus or the Prospectus, of the suspension of the qualification of the
Stock 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
Statements or the Prospectus or for additional information; and, in the
event of the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or the Prospectus or
suspending any such qualification, use promptly its best efforts to obtain
its withdrawal.
(b) If, at any time prior to the expiration of nine months after the effective
date of the Initial Registration Statement when a prospectus relating to
the Stock is required to be delivered, any event occurs as a result of
which the Prospectus as then amended or supplemented would include any
untrue statement of a material fact, or omit to state any material fact
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading, or if it is necessary at any
time to amend the Prospectus to comply with the Securities Act, the Company
will promptly notify the Representatives thereof and upon their request
will prepare an amended or supplemented Prospectus which will correct such
statement or omission or effect such compliance. The Company will furnish
without charge to each Underwriter and to any dealer in securities as many
copies as the Representatives may from time to time reasonably request of
such amended or supplemented Prospectus; and in case any Underwriter is
required to deliver a prospectus relating to the Stock nine months or more
after the effective date of the Initial Registration Statement, the Company
upon the request of the Representatives and at the expense of such
Underwriter will prepare promptly an amended or supplemented Prospectus as
may be necessary to permit compliance with the requirements of Section
10(a)(3) of the Securities Act.
(c) To furnish promptly to each of the Representatives and to counsel for the
Underwriters a signed copy of each of the Registration Statements as
originally filed with the Commission, and each amendment thereto filed with
the Commission, including all consents and exhibits filed therewith.
(d) To deliver promptly to the Representatives in New York City such number of
the following documents as the Representatives shall reasonably request:
(i) conformed copies of the Registration Statements as originally filed
with the Commission and each amendment thereto (in each case excluding
exhibits), (ii) each Preliminary Prospectus,
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and (iii) the Prospectus (not later than 10:00 A.M., New York time, of the
business day following the execution and delivery of this Agreement) and
any amended or supplemented Prospectus (not later than 10:00 A.M., New York
City time, on the business day following the date of such amendment or
supplement).
(e) To make generally available to its shareholders 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 Securities
Act), an earnings statement of the Company and its subsidiary (which need
not be audited) complying with Section 11(a) of the Securities Act and the
Rules and Regulations (including, at the option of the Company, Rule 158).
(f) [The Company will promptly take from time to time such actions as the
Representatives may reasonably request to qualify the Stock for offering
and sale under the securities or Blue Sky laws of such jurisdictions as the
Representatives may designate and to continue such qualifications in effect
for so long as required for the distribution of the Stock; provided that
the Company and its subsidiary shall not be obligated to qualify as foreign
corporations in any jurisdiction in which they are not so qualified or to
file a general consent to service of process in any jurisdiction;]
(g) During the period of five years from the date hereof, the Company will
deliver to the Representatives and, upon request, to each of the other
Underwriters, (i) as soon as they are available, copies of all reports or
other communications furnished to shareholders and (i) as soon as they are
available, copies of any reports and financial statements furnished or
filed with the Commission pursuant to the Exchange Act or any national
securities exchange or automatic quotation system on which the Stock is
listed or quoted.
(h) The Company will not directly or indirectly offer, sell, assign, transfer,
pledge, contract to sell, or otherwise dispose of any shares of Common
Stock or securities convertible into or exercisable or exchangeable for
Common Stock for a period of 180 days from the date of the Prospectus
without the prior written consent of XX Xxxxx other than the Company's sale
of the Stock hereunder and the issuance of shares pursuant to employee
benefit plans, qualified stock option plans or other employee compensation
plans existing on the date hereof or pursuant to currently outstanding
options, warrants or rights. The Company will cause each officer, director
and shareholder listed in Schedule B to furnish to the Representatives,
prior to the First Closing Date, a letter, substantially in the form of
Exhibit I hereto, pursuant to which each such person shall agree not to
directly or indirectly offer, sell, assign, transfer, pledge, contract to
sell, or otherwise dispose of any shares of Common Stock or securities
convertible into or exercisable or exchangeable for Common Stock for a
period of 180 days from the date of the Prospectus, without the prior
written consent of XX Xxxxx.
(i) The Company will supply the Representatives with copies of all
correspondence to and from, and all documents issued to and by, the
Commission in connection with the registration of the Stock under the
Securities Act.
11
(j) Prior to each of the Closing Dates the Company will furnish to the
Representatives, as soon as they have been prepared, copies of any
unaudited interim consolidated financial statements of the Company for any
periods subsequent to the periods covered by the financial statements
appearing in the Registration Statement and the Prospectus.
(k) Prior to each of the Closing Dates, the Company will not issue any press
release or other communication directly or indirectly or hold any press
conference with respect to the Company, its condition, financial or
otherwise, or earnings, business affairs or business prospects (except for
routine oral marketing communications in the ordinary course of business
and consistent with the past practices of the Company and of which the
Representatives are notified), without the prior written consent of the
Representatives, unless in the judgment of the Company and its counsel, and
after notification to the Representatives, such press release or
communication is required by law.
(l) In connection with the offering of the Stock, until XX Xxxxx shall have
notified the Company of the completion of the resale of the Stock, the
Company will not, and will cause its affiliated purchasers (as defined in
Regulation M under the Exchange Act) not to, either alone or with one or
more other persons, bid for or purchase, for any account in which it or any
of its affiliated purchasers has a beneficial interest, any Stock, or
attempt to induce any person to purchase any Stock; and not to, and to
cause its affiliated purchasers not to, make bids or purchase for the
purpose of creating actual, or apparent, active trading in or of raising
the price of the Stock.
(m) The Company will not take any action prior to the Option Closing Date which
would require the Prospectus to be amended or supplemented pursuant to
Section 4(b);
(n) The Company will apply the net proceeds from the sale of the Stock as set
forth in the Prospectus under the heading "Use of Proceeds".
5. PAYMENT OF EXPENSES. The Company agrees with the Underwriters to pay
(a) the costs incident to the authorization, issuance, sale, preparation and
delivery of the Stock and any taxes payable in that connection; (b) the costs
incident to the Registration of the Stock under the Securities Act; (c) the
costs incident to the preparation, printing and distribution of the Registration
Statement, Preliminary Prospectus, Prospectus any amendments and exhibits
thereto the costs of printing, reproducing and distributing the "Master
Agreement Among Underwriters" between the Representatives and the Underwriters,
the Master Selected Dealers' Agreement, the Underwriters' Questionnaire and this
Agreement by mail, telex or other means of communications; (d) the fees and
expenses (including related fees and expenses of counsel for the Underwriters)
incurred in connection with filings made with the National Association of
Securities Dealers; (e) any applicable listing or other fees; (f) the fees and
expenses of qualifying the Stock under the securities laws of the several
jurisdictions as provided in Section 4(f) and of preparing, printing and
distributing Blue Sky Memoranda and Legal Investment Surveys (including related
fees and expenses of counsel to the Underwriters); (g) all fees and expenses of
the registrar and transfer agent of the Stock; and (h) all other costs and
expenses incident to the performance of the obligations of the Company under
this Agreement (including, without limitation, the fees and expenses of the
Company's counsel and the Company's independent
12
accountants); provided that, except as otherwise provided in this Section 5 and
in Section 10, the Underwriters shall pay their own costs and expenses,
including the fees and expenses of their counsel, any transfer taxes on the
Stock which they may sell and the expenses of advertising any offering of the
Stock made by the Underwriters.
6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The respective obligations of the
several Underwriters hereunder are subject to the accuracy, when made and on
each of the Closing Dates, of the representations and warranties of the Company
contained herein, to the accuracy of the statements of the Company made in any
certificates pursuant to the provisions hereof, to the performance by the
Company of their obligations hereunder, and to each of the following additional
terms and conditions:
(a) No stop order suspending the effectiveness of either of the Registration
Statements shall have been issued and no proceedings for that purpose shall
have been initiated or threatened by the Commission, and any request for
additional information on the part of the Commission (to be included in the
Registration Statements or the Prospectus or otherwise) shall have been
complied with to the reasonable satisfaction of the Representatives. The
Rule 462(b) Registration Statement, if any, and the Prospectus shall have
been timely filed with the Commission in accordance with Section 4(a).
(b) None of the Underwriters shall have discovered and disclosed to the Company
on or prior to the Closing Date that the Registration Statement or the
Prospectus or any amendment or supplement thereto contains an untrue
statement of a fact which, in the opinion of counsel for the Underwriters,
is material or omits to state any fact which, in the opinion of such
counsel, is material and is required to be stated therein or is necessary
to make the statements therein not misleading.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of each of this Agreement, the Stock, the
Registration Statement and the Prospectus and all other legal matters
relating to this Agreement and the transactions contemplated hereby shall
be reasonably satisfactory in all material respects to counsel for the
Underwriters, and the Company shall have furnished to such counsel all
documents and information that they may reasonably request to enable them
to pass upon such matters.
(d) Xxxx and Xxxx LLP shall have furnished to the Representatives such
counsel's written opinion, as counsel to the Company, addressed to the
Underwriters and dated the Closing Date, in form and substance reasonably
satisfactory to the Representatives, to the effect that:
(i) The Company and its subsidiary have been duly incorporated and are
validly existing as corporations in good standing under the laws of their
respective jurisdictions of incorporation, are duly qualified to do
business and are in good standing as foreign corporations in each
jurisdiction in which their respective ownership or lease of property or
the conduct of their respective businesses requires such qualification, and
have all power and authority necessary to own or hold their respective
properties and to conduct the businesses in which they are engaged, except
where the failure to so qualify or have such power or authority would not
have, singularly or in the aggregate, a Material Adverse Effect.
13
(ii) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company,
including the Stock being delivered on the Closing Date, have been duly and
validly authorized and issued, are fully paid and non-assessable and
conform to the description thereof contained in the Prospectus.
(iii) All the outstanding shares of capital stock of the subsidiary of the
Company have been duly authorized and validly issued, are fully paid and
nonassessable and, except to the extent set forth in the Prospectus, are
owned by the Company directly, free and clear of any claim, lien,
encumbrance, security interest, restriction upon voting or transfer or any
other claim of any third party.
(iv) There are no preemptive or other rights to subscribe for or to
purchase, nor any restriction upon the voting or transfer of, any shares of
the Stock pursuant to the Company's charter or by-laws or any agreement or
other instrument known to such counsel.
(v) This Agreement has been duly authorized, executed and delivered by the
Company.
(vi) The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby 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 known to such counsel after
reasonable investigation to which the Company or its subsidiary is a party
or by which the Company or its subsidiary is bound or to which any of the
properties or assets of the Company or its subsidiary is subject, nor will
such actions result in any violation of the Charter or by-laws of the
Company or of its subsidiary or any statute or any order, rule or
regulation of any court or governmental agency or body or court having
jurisdiction over the Company or its subsidiary or any of their properties
or assets.
(vii) Except for the registration of the Stock under the Securities Act
and such consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and applicable
state securities laws in connection with the purchase and distribution of
the Stock by the Underwriters, no consent, approval, authorization or order
of, or filing or registration with, any such court or governmental agency
or body is required for the execution, delivery and performance of this
Agreement by the Company and the consummation of the transactions
contemplated hereby.
(viii) The statements in the Prospectus under the heading "Management -
Stock Plans," "Description of Capital Stock - Delaware Anti-Takeover Law
and Charter and By-law Provisions" and "Shares Eligible For Future Sale" to
the extent that they constitute summaries of matters of law or regulation
or legal conclusions, have been reviewed by such counsel and fairly
summarize the matters described therein in all material respects.
14
(ix) The description in the Registration Statement and Prospectus of
statutes, legal or governmental proceedings and contracts and other
documents are accurate in all material respects; and to the best of such
counsel's knowledge, there are no statutes, legal or governmental
proceedings, contracts or other documents of a character required to be
described in the Registration Statement or Prospectus or to be filed as
exhibits to the Registration Statement which are not described or filed as
required.
(x) To the best of such counsel's knowledge, neither the Company nor its
subsidiary (i) is in violation of its charter or by-laws, (ii) is in
default, and no event has occurred, which, with notice or lapse of time or
both, would constitute a default, in the due performance or observance of
any term, covenant or condition contained in any agreement or instrument to
which it is a party or by which it is bound or to which any of its
properties or assets is subject or (iii) is in violation of any law,
ordinance, governmental rule, regulation or court decree to which it or its
property or assets may be subject or has failed to obtain any license,
permit, certificate, franchise or other governmental authorization or
permit necessary to the ownership of its property or to the conduct of its
business except, in the case of clauses (ii) and (iii), for those defaults,
violations or failures which, either individually or in the aggregate,
would not have a Material Adverse Effect.
(xi) 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 its subsidiary is a party or of which any property
or asset of the Company or its subsidiary is the subject which, singularly
or in the aggregate, if determined adversely to the Company or its
subsidiary, might have a Material Adverse Effect or would prevent or
adversely affect the ability of the Company to perform its obligations
under this Agreement; and, to the best of such counsel's knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others.
(xii) The Registration Statement was declared effective under the
Securities Act as of the date and time specified in such opinion, the Rule
462(b) Registration Statement, if any, was filed with the Commission on the
date specified therein, the Prospectus was filed with the Commission
pursuant to the subparagraph of Rule 424(b) of the Rules and Regulations
specified in such opinion on the date specified therein and no stop order
suspending the effectiveness of the Registration Statement has been issued
and, to the knowledge of such counsel, no proceeding for that purpose is
pending or threatened by the Commission.
(xiii) The Registration Statements, as of the respective effective dates
and the Prospectus, as of its date, and any further amendments or
supplements thereto, as of their respective dates, made by the Company
prior to the Closing Date (other than the financial statements and other
financial data contained therein, as to which such counsel need express no
opinion) complied as to form in all material respects with the requirements
of the Securities Act and the Rules and Regulations of the Commission
thereunder.
15
(xiv) To the best of such counsel's knowledge, no person or entity has the
right to require registration of shares of Common Stock or other securities
of the Company because of the filing or effectiveness of the Registration
Statements or otherwise, except for persons and entities who have expressly
waived such right or who have been given proper notice and have failed to
exercise such right within the time or times required under the terms and
conditions of such right.
(xv) Neither the Company nor its subsidiary is an "investment company"
within the meaning of the Investment Company Act and the rules and
regulations of the Commission thereunder.
Such counsel shall also have furnished to the Representatives a
written statement, addressed to the Underwriters and dated the Closing
Date, in form and substance satisfactory to the Representatives, to the
effect that (x) such counsel has acted as counsel to the Company in
connection with the preparation of the Registration Statements, (y) based
on such counsel's examination of the Registration Statements and such
counsel's investigations made in connection with the preparation of the
Registration Statements and "conferences with certain officers and
employees of and with auditors for and counsel to the Company", such
counsel has no reason to believe that the Registration Statements, as of
the respective effective dates, contained any untrue statement of a
material fact or omitted to state any material fact required to be stated
therein or necessary in order to make the statements therein not
misleading, or that the Prospectus contains any untrue statement of a
material fact or omits to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading; it being
understood that such counsel need not express any opinion as to the
financial statements or other financial data contained in the Registration
Statement or the Prospectus.
The foregoing opinion and statement may be qualified by a statement
to the effect that such counsel has not independently verified the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus and takes no responsibility
therefor except to the extent set forth in the opinion described in clauses
(viii) and (ix) above.
(e) The Representatives shall have received from Xxxxxxx, Phleger & Xxxxxxxx
LLP, counsel for the Underwriters, such opinion or opinions, dated the
Closing Date, with respect to such matters as the Underwriters may
reasonably require, and the Company shall have furnished to such counsel
such documents as they request for enabling them to pass upon such matters.
(f) At the time of the execution of this Agreement, the Representatives shall
have received from PricewaterhouseCoopers LLP a letter, addressed to the
Underwriters and dated such date, in form and substance satisfactory to the
Representatives (i) confirming that they are independent certified public
accountants with respect to the Company and its subsidiary within the
meaning of the Securities Act and the Rules and Regulations and (ii)
stating the conclusions and findings of such firm with respect to the
financial statements and certain financial information contained or
incorporated by reference in the Prospectus.
16
(g) On the Closing Date, the Representatives shall have received a letter (the
"bring-down letter") from PricewaterhouseCoopers LLP addressed to the
Underwriters and dated the Closing Date confirming, as of the date of the
bring-down letter (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Prospectus as of a date not more than three
business days prior to the date of the bring-down letter), the conclusions
and findings of such firm with respect to the financial information and
other matters covered by its letter delivered to the Representatives
concurrently with the execution of this Agreement pursuant to Section 6(g).
(h) The Company shall have furnished to the Representatives a certificate,
dated the Closing Date, of its Chairman of the Board, its President or a
Vice President and its chief financial officer stating that (i) such
officers have carefully examined the Registration Statements and the
Prospectus and, in their opinion, the Registration Statements as of their
respective effective dates and the Prospectus, as of each such effective
date, did not include any untrue statement of a material fact and did not
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, (ii) since the effective date
of the Initial Registration Statement no event has occurred which should
have been set forth in a supplement or amendment to the Registration
Statements or the Prospectus, (iii) to the best of their knowledge after
reasonable investigation, as of the Closing Date, the representations and
warranties of the Company in this Agreement are true and correct and the
Company has complied with all agreements and satisfied all conditions on
its part to be performed or satisfied hereunder at or prior to the Closing
Date, and (iv) subsequent to the date of the most recent financial
statements included in the Prospectus, there has been no material adverse
change in the financial position or results of operations of the Company
and its subsidiary, or any change, or any development including a
prospective change, in or affecting the condition (financial or otherwise),
results of operations, business or prospects of the Company and its
subsidiary taken as a whole, except as set forth in the Prospectus.
(i) Neither the Company nor its subsidiary shall have sustained since the date
of the latest audited financial statements included in the Prospectus (i)
any loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as
set forth or contemplated in the Prospectus or (ii) since such date there
shall not have been any change in the capital stock or long-term debt of
the Company or its subsidiary or any change, or any development involving a
prospective change, in or affecting the business, general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiary, 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
Representatives, so material and adverse as to make it impracticable or
inadvisable to proceed with the sale or delivery of the Stock on the terms
and in the manner contemplated in the Prospectus.
17
(j) No action shall have been taken and no statute, rule, regulation or order
shall have been enacted, adopted or issued by any governmental agency or
body which would, as of the Closing Date, prevent the issuance or sale of
the Stock; and no injunction, restraining order or order of any other
nature by any federal or state court of competent jurisdiction shall have
been issued as of the Closing Date which would prevent the issuance or sale
of the Stock.
(k) Subsequent to the execution and delivery of this Agreement (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) of
the Rules and Regulations and (ii) no such organization shall have publicly
announced that it has under surveillance or review (other than an
announcement with positive implications of a possible upgrading), its
rating of any of the Company's debt securities.
(l) Subsequent to the execution and delivery of this Agreement there shall not
have occurred any of the following: (i) trading in securities generally on
the New York Stock Exchange or the American Stock Exchange or in the over-
the-counter market, or trading in any securities of the Company on any
exchange or in the over-the-counter market, shall have been suspended or
minimum prices shall have been established on any such exchange or such
market by the Commission, by such exchange or by any other regulatory body
or governmental authority having jurisdiction, (ii) a banking moratorium
shall have been declared by Federal or state authorities, (iii) the United
States shall have become engaged in hostilities, there shall have been an
escalation in hostilities involving the United States or there shall have
been a declaration of a national emergency or war by the United States or
(iv) there shall have occurred such a material adverse change in general
economic, political or financial conditions (or the effect of international
conditions on the financial markets in the United States shall be such) as
to make it, in the judgment of the Representatives, impracticable or
inadvisable to proceed with the sale or delivery of the Stock on the terms
and in the manner contemplated in the Prospectus.
(m) The Nasdaq National Market System shall have approved the Stock for
listing, subject only to official notice of issuance and evidence of
satisfactory distribution.
(n) XX Xxxxx shall have received the written agreements, substantially in the
form of Exhibit I hereto, of the officers, directors and shareholders of
the Company listed in Schedule B to this Agreement.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company shall indemnify and hold harmless each Underwriter, its
officers, employees, representatives and agents and each person, if any,
who controls any Underwriter within the meaning of the Securities Act
(collectively the "Underwriter
18
Indemnified Parties" and , each an "Underwriter Indemnified Party") against
any loss, claim, damage or liability, joint or several, or any action in
respect thereof, to which that Underwriter Indemnified Party may become
subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of or is based upon (i) any
untrue statement or alleged untrue statement of a material fact contained
in the Preliminary Prospectus, either of the Registration Statements or the
Prospectus or in any amendment or supplement thereto, (ii) the omission or
alleged omission to state in any Preliminary Prospectus, either of the
Registration Statements or the Prospectus or in any amendment or supplement
thereto a material fact required to be stated therein or necessary to make
the statements therein not misleading or (iii) any act or failure to act,
or any alleged act or failure to act, by any Underwriter in connection
with, or relating in any manner to , the Stock or the offering contemplated
hereby, and which is included as part of or referred to in any loss, claim,
damage, liability or action arising out of or based upon matters covered by
clause (i) or (ii) above, (provided that the Company shall not be liable in
the case of any matter covered by this clause (iii) to the extent that it
is determined in a final judgement by a court of competent jurisdiction
that such loss, claim, damage, liability or action resulted directly from
any such act or failure to act undertaken or omitted to be taken by such
Underwriter through its gross negligence or willful misconduct) and shall
reimburse each Underwriter Indemnified Party promptly upon demand for any
legal or other expenses reasonably incurred by that Underwriter Indemnified
Party in connection with investigating or preparing to defend or defending
against or appearing as a third party witness in connection with any such
loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that the Company shall not be liable in any such case to
the extent that any such loss, claim, damage, liability or action arises
out of or is based upon (i) an untrue statement or alleged untrue statement
in or omission or alleged omission from the Preliminary Prospectus, either
of the Registration Statements or the Prospectus or any such amendment or
supplement in reliance upon and in conformity with written information
furnished to the Company through the Representatives by or on behalf of any
Underwriter specifically for use therein, which information the parties
hereto agree is limited to the Underwriters' Information (as defined in
Section 16). This indemnity agreement is not exclusive and will be in
addition to any liability which the Company might otherwise have and shall
not limit any rights or remedies which may otherwise be available at law or
in equity to each Underwriter Indemnified Party.
(b) Each Underwriter, severally and not jointly, shall indemnify and hold
harmless the Company its officers, employees, representatives and agents,
each of its directors and each person, if any, who controls the Company
within the meaning of the Securities Act (collectively the "Company
Indemnified Parties" and each a "Company Indemnified Party") against any
loss, claim, damage or liability, joint or several, or any action in
respect thereof, to which the Company Indemnified Parties may become
subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of or is based upon (i) any
untrue statement or alleged untrue statement of a material fact contained
in the Preliminary Prospectus, either of the Registration Statements or the
Prospectus or in any amendment or supplement thereto or (ii) 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, but in
each case only to the
19
extent that the untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information furnished to the Company through the Representatives by or on
behalf of that Underwriter specifically for use therein, and shall
reimburse the Company Indemnified Parties for any legal or other expenses
reasonably incurred by such parties in connection with investigating or
preparing to defend or defending against or appearing as third party
witness in connection with any such loss, claim, damage, liability or
action as such expenses are incurred; provided that the parties hereto
hereby agree that such written information provided by the Underwriters
consists solely of the Underwriter's Information. This indemnity agreement
is not exclusive and will be in addition to any liability which the
Underwriters might otherwise have and shall not limit any rights or
remedies which may otherwise be available at law or in equity to the
Company Indemnified Parties.
(c) Promptly after receipt by an indemnified party under this Section 7 of
notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 7, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however,
that the failure to notify the indemnifying party shall not relieve it from
any liability which it may have under this Section 7 except to the extent
it has been materially prejudiced by such failure; and, provided, further,
that the failure to notify the indemnifying party shall not relieve it from
any liability which it may have to an indemnified party otherwise than
under this Section 7. If any such claim or action shall be brought against
an indemnified party, and it shall notify the indemnifying party thereof,
the indemnifying party shall be entitled to participate therein and, to the
extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the indemnifying
party to the indemnified party of its election to assume the defense of
such claim or action, the indemnifying party shall not be liable to the
indemnified party under this Section 7 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation; provided,
however, that any indemnified party shall have the right to employ separate
counsel in any such action and to participate in the defense thereof but
the fees and expenses of such counsel shall be at the expense of such
indemnified party unless (i) the employment thereof has been specifically
authorized by the indemnifying party in writing, (ii) such indemnified
party shall have been advised by such counsel that there may be one or more
legal defenses available to it which are different from or additional to
those available to the indemnifying party and in the reasonable judgment of
such counsel it is advisable for such indemnified party to employ separate
counsel or (iii) the indemnifying party has failed to assume the defense of
such action and employ counsel reasonably satisfactory to the indemnified
party, in which case, if such indemnified party notifies the indemnifying
party in writing that it elects to employ separate counsel at the expense
of the indemnifying party, the indemnifying party shall not have the right
to assume the defense of such action on behalf of such indemnified party,
it being understood, however, that the indemnifying party shall not, in
connection with any one such action or separate but substantially similar
or related actions in the same jurisdiction arising out of the same general
allegations or
20
circumstances, be liable for the reasonable fees and expenses of more than
one separate firm of attorneys at any time for all such indemnified
parties, which firm shall be designated in writing by XX Xxxxx, if the
indemnified parties under this Section 7 consist of any Underwriter
Indemnified Party, or by the Company if the indemnified parties under this
Section 7 consist of any Company Indemnified Parties. Each indemnified
party, as a condition of the indemnity agreements contained in Sections
7(a) and 7(b), shall use all reasonable efforts to cooperate with the
indemnifying party in the defense of any such action or claim. Subject to
the provisions of Section 7(d) below, no indemnifying party shall be liable
for any settlement of any such action effected without its written consent
(which consent shall not be unreasonably withheld), but if settled with its
written consent or if there be a final judgment for the plaintiff in any
such action, the indemnifying party agrees to indemnify and hold harmless
any indemnified party from and against any loss or liability by reason of
such settlement or judgment.
(d) If at any time an indemnified party shall have requested that an
indemnifying party reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by this Section 7 effected without
its written consent if (i) such settlement is entered into more than 45
days after receipt by such indemnifying party of the request for
reimbursement, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement
being entered into and (iii) such indemnifying party shall not have
reimbursed such indemnified party in accordance with such request prior to
the date of such settlement.
(e) If the indemnification provided for in this Section 7 is unavailable or
insufficient to hold harmless an indemnified party under Section 7(a) or
7(b), then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such
indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, (i) in such proportion as shall be appropriate
to reflect the relative benefits received by the Company on the one hand
and the Underwriters on the other from the offering of the Stock or if the
allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Company on the one hand and the Underwriters on the other with respect to
the statements or omissions which resulted in such loss, claim, damage or
liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company on
the one hand and the Underwriters on the other with respect to such
offering shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Stock purchased under this Agreement
(before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters with
respect to the Stock 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 on the one hand or the Underwriters on the other, the intent of the
parties and their relative knowledge, access to information and opportunity
to correct or prevent such untrue statement or
21
omission; provided that the parties hereto agree that the written
information furnished to the Company through the Representatives by or on
behalf of the Underwriters for use in any Preliminary Prospectus, either of
the Registration Statements or the Prospectus consists solely of the
Underwriter's Information. The Company and the Underwriters agree that it
would not be just and equitable if contributions pursuant to this Section
8(e) were to be determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of
allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section 8(e) shall be deemed to include,
for purposes of this Section 8(e), 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
Section 8(e), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Stock
underwritten by it and distributed to the public were offered to the public
less the amount of any damages which such Underwriter has otherwise paid or
become liable to pay by reason of any 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 Securities
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation.
The Underwriters' obligations to contribute as provided in this Section
8(e) are several in proportion to their respective underwriting obligations and
not joint.
8. TERMINATION. The obligations of the Underwriters hereunder may be
terminated by XX Xxxxx, in its absolute discretion by notice given to and
received by the Company prior to delivery of and payment for the Firm Stock if,
prior to that time, any of the events described in Sections 6(k), 6(m) or 6(n)
have occurred or if the Underwriters shall decline to purchase the Stock for any
reason permitted under this Agreement.
9. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If (a) this Agreement shall have
been terminated pursuant to Section 8 or 10, (b) the Company shall fail to
tender the Stock for delivery to the Underwriters for any reason permitted under
this Agreement, or (c) the Underwriters shall decline to purchase the Stock for
any reason permitted under this Agreement the Company shall reimburse the
Underwriters for the fees and expenses of their counsel and for such other out-
of-pocket expenses as shall have been reasonably incurred by them in connection
with this Agreement and the proposed purchase of the Stock, and upon demand the
Company shall pay the full amount thereof to the XX Xxxxx. If this Agreement is
terminated pursuant to Section 10 by reason of the default of one or more
Underwriters, the Company shall not be obligated to reimburse any defaulting
Underwriter on account of those expenses.
10. SUBSTITUTION OF UNDERWRITERS. If any Underwriter or Underwriters shall
default in its or their obligations to purchase shares of Stock hereunder and
the aggregate number of shares which such defaulting Underwriter or Underwriters
agreed but failed to purchase does not exceed ten percent (10%) of the total
number of shares underwritten, the other Underwriters shall be obligated
severally, in proportion to their respective commitments hereunder, to purchase
the shares which such defaulting Underwriter or Underwriters agreed but failed
to
22
purchase. If any Underwriter or Underwriters shall so default and the aggregate
number of shares with respect to which such default or defaults occur is more
than ten percent (10%) of the total number of shares underwritten and
arrangements satisfactory to the Representatives and the Company for the
purchase of such shares by other persons are not made within forty-eight (48)
hours after such default, this Agreement shall terminate.
If the remaining Underwriters or substituted Underwriters are required
hereby or agree to take up all or part of the shares of Stock of a defaulting
Underwriter or Underwriters as provided in this Section 10, (i) the Company
shall have the right to postpone the Closing Dates for a period of not more than
five (5) full business days in order that the Company may 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
promptly to file any amendments to the Registration Statement or supplements to
the Prospectus which may thereby be made necessary, and (ii) the respective
numbers of shares to be purchased by the remaining Underwriters or substituted
Underwriters shall be taken as the basis of their underwriting obligation for
all purposes of this Agreement. Nothing herein contained shall relieve any
defaulting Underwriter of its liability to the Company or the other Underwriters
for damages occasioned by its default hereunder. Any termination of this
Agreement pursuant to this Section 10 shall be without liability on the part of
any non-defaulting Underwriter or the Company, except expenses to be paid or
reimbursed pursuant to Sections 5 and 9 and except the provisions of Section 7
shall not terminate and shall remain in effect.
11. SUCCESSORS; PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall
inure to the benefit of and be binding upon the several Underwriters, the
Company and their respective successors. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person other than the
persons mentioned in the preceding sentence any legal or equitable right, remedy
or claim under or in respect of this Agreement, or any provisions herein
contained, this Agreement and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of such persons and
for the benefit of no other person; except that the representations, warranties,
covenants, agreements and indemnities of the Company contained in this Agreement
shall also be for the benefit of the Underwriter Indemnified Parties, and the
indemnities of the several Underwriters shall also be for the benefit of the
Company Indemnified Parties.
12. SURVIVAL OF INDEMNITIES, REPRESENTATIONS, WARRANTIES, ETC. The respective
indemnities, covenants, agreements, representations, warranties and other
statements of the Company and the several Underwriters, as set forth in this
Agreement or made by them respectively, pursuant to this Agreement, shall remain
in full force and effect, regardless of any investigation made by or on behalf
of any Underwriter, the Company or any person controlling any of them and shall
survive delivery of and payment for the Stock.
13. NOTICES. All statements, requests, notices and agreements hereunder shall
be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail, telex or
facsimile transmission to XX Xxxxx Securities Corporation Attention: Xxxxx
Xxxxxx (Fax: 000-000-0000); provided, however, that any notice to an
Underwriter pursuant to Section 7
23
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Representatives, which address will be supplied to any other party hereto
by the Representatives upon request.
(b) if to the Company, shall be delivered or sent by mail, telex or
facsimile transmission to XXXX.xxx, Inc. Attention: [Xxxxxx X. Xxxxx] (Fax:
000-000-0000).
Any such statements, requests, notices or agreements shall take effect at
the time of receipt thereof.
14. DEFINITION OF CERTAIN TERMS. For purposes of this Agreement, (a) "business
day" means any day on which the New York Stock Exchange, Inc. is open for
trading and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
15. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
16. UNDERWRITERS' INFORMATION. The parties hereto acknowledge and agree that,
for all purposes of this Agreement, the Underwriters' Information consists
solely of the following information in the Prospectus: (i) the last paragraph on
the front cover page concerning the terms of the offering by the Underwriters;
and (ii) the statements concerning the Underwriters contained in the paragraphs
under the heading "Underwriting."
17. AUTHORITY OF THE REPRESENTATIVES. In connection with this Agreement, you
will act for and on behalf of the several Underwriters, and any action taken
under this Agreement by the Representatives, will be binding on all the
Underwriters.
18. PARTIAL UNENFORCEABILITY. The invalidity or unenforceability of any
Section, paragraph or provision of this Agreement shall not affect the validity
or enforceability of any other Section, paragraph or provision hereof. If any
Section, paragraph or provision of this Agreement is for any reason determined
to be invalid or unenforceable, there shall be deemed to be made such minor
changes (and only such minor changes) as are necessary to make it valid and
enforceable.
19. GENERAL. This Agreement constitutes the entire agreement of the parties to
this Agreement and supersedes all prior written or oral and all contemporaneous
oral agreements, understandings and negotiations with respect to the subject
matter hereof. In this Agreement, the masculine, feminine and neuter genders
and the singular and the plural include one another. The section headings in
this Agreement are for the convenience of the parties only and will not affect
the construction or interpretation of this Agreement. This Agreement may be
amended or modified, and the observance of any term of this Agreement may be
waived, only by a writing signed by the Company and the Representatives.
20. COUNTERPARTS. This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
24
If the foregoing is in accordance with your understanding of the agreement
between the Company and the several Underwriters, kindly indicate your
acceptance in the space provided for that purpose below.
Very truly yours,
XXXX.XXX, INC.
By:
--------------------------------
Name:
Title:
Accepted as of
the date first above written:
XX XXXXX SECURITIES CORPORATION
XXXX XXXXXXXX INCORPORATED
U.S. BANCORP XXXXX XXXXXXX INC.
XXXXXXX XXXXX & COMPANY, L.L.C.
Acting on their own behalf
and as Representatives of several
Underwriters referred to in the
foregoing Agreement.
By: XX XXXXX SECURITIES CORPORATION
By:
--------------------------------
Name:
Title:
