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Draft of 10/1/97
2,400,000 SHARES
MOVADO GROUP, INC.
COMMON STOCK ($0.01 PAR VALUE)
UNDERWRITING AGREEMENT
October __, 1997
CREDIT SUISSE FIRST BOSTON CORPORATION
XXXXXX XXXX LLC
XXXXXX & XXXXXXX, INC.
As Representatives of the Several Underwriters,
c/o Credit Suisse First Boston Corporation
Xxxxxx Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Dear Sirs:
1. Introductory. Movado Group, Inc., a New York corporation
("Company"), proposes to issue and sell 1,500,000 shares of its common stock,
par value $0.01 per share ("Securities"), and the shareholders listed in
Schedule A hereto ("Selling Shareholders", and each a "Selling Shareholder")
propose severally to sell an aggregate of 900,000 outstanding shares of the
Securities (such 2,400,000 Securities being hereinafter referred to as the "Firm
Securities"). One of the Selling Shareholders also proposes to sell to the
Underwriters, at the option of the Underwriters, an aggregate of not more than
240,000 additional outstanding shares of the Company's Securities, as set forth
on Schedule A (such 240,000 additional shares being hereinafter referred to as
the "Optional Securities"). The Firm Securities and the Optional Securities are
herein collectively referred to as the "Offered Securities". The Company and the
Selling Shareholders hereby agree with the several Underwriters named in
Schedule B ("Underwriters") as follows:
2. Representations and Warranties of the Company and the Selling
Shareholders.
(a) The Company represents and warrants to, and agrees with, the
several Underwriters that:
(i) A registration statement (No. 333-35875) relating to the
Offered Securities, including a form of prospectus, has been filed
with the Securities and Exchange Commission ("Commission") and either
(A) has been declared effective under the Securities Act of 1933, as
amended ("Act"), and is not proposed to be amended or (B) is proposed
to be amended by amendment or post-effective amendment. If such
registration statement (the "initial registration statement") has been
declared effective, either (A) an additional registration statement
(the "additional registration statement") relating to the Offered
Securities may have been filed with the Commission pursuant to Rule
462(b) ("Rule 462(b)") under the Act and, if so filed, has become
effective upon filing pursuant to such Rule and the Offered Securities
all have
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been duly registered under the Act pursuant to the initial
registration statement and, if applicable, the additional registration
statement or (B) such an additional registration statement is proposed
to be filed with the Commission pursuant to Rule 462(b) and will
become effective upon filing pursuant to such Rule and upon such
filing the Offered Securities will all have been duly registered under
the Act pursuant to the initial registration statement and such
additional registration statement. If the Company does not propose to
amend the initial registration statement or if an additional
registration statement has been filed and the Company does not propose
to amend it, and if any post-effective amendment to either such
registration statement has been filed with the Commission prior to the
execution and delivery of this Agreement, the most recent amendment
(if any) to each such registration statement has been declared
effective by the Commission or has become effective upon filing
pursuant to Rule 462(c) ("Rule 462(c)") under the Act or, in the case
of the additional registration statement, Rule 462(b). For purposes of
this Agreement, "Effective Time" with respect to the initial
registration statement or, if filed prior to the execution and
delivery of this Agreement, the additional registration statement
means (A) if the Company has advised the Representatives that it does
not propose to amend such registration statement, the date and time as
of which such registration statement, or the most recent
post-effective amendment thereto (if any) filed prior to the execution
and delivery of this Agreement, was declared effective by the
Commission or has become effective upon filing pursuant to Rule
462(c), or (B) if the Company has advised the Representatives that it
proposes to file an amendment or post-effective amendment to such
registration statement, the date and time as of which such
registration statement, as amended by such amendment or post-effective
amendment, as the case may be, is declared effective by the
Commission. If an additional registration statement has not been filed
prior to the execution and delivery of this Agreement but the Company
has advised the Representatives that it proposes to file one,
"Effective Time" with respect to such additional registration
statement means the date and time as of which such registration
statement is filed and becomes effective pursuant to Rule 462(b).
"Effective Date" with respect to the initial registration statement or
the additional registration statement (if any) means the date of the
Effective Time thereof. The initial registration statement, as amended
at its Effective Time, including all material incorporated by
reference therein, including all information contained in the
additional registration statement (if any) and deemed to be a part of
the initial registration statement as of the Effective Time of the
additional registration statement pursuant to the General Instructions
of the Form on which it is filed and including all information (if
any) deemed to be a part of the initial registration statement as of
its Effective Time pursuant to Rule 430A(b) ("Rule 430A(b)") under the
Act, is hereinafter referred to as the "Initial Registration
Statement". The additional registration statement, as amended at its
Effective Time, including the contents of the initial registration
statement incorporated by reference therein, and including all
information (if any) deemed to be a part of the additional
registration statement as of its Effective Time pursuant to Rule
430A(b), is hereinafter referred to as the "Additional Registration
Statement". The Initial Registration Statement and the Additional
Registration Statement are hereinafter referred to collectively as the
"Registration Statements" and individually as a "Registration
Statement". The form of prospectus relating to the Offered Securities,
as first filed with the Commission pursuant to and in accordance with
Rule 424(b) ("Rule 424(b)") under the Act or (if no such filing is
required) as included in a Registration Statement, including all
material incorporated by reference in such prospectus, is hereinafter
referred to as the "Prospectus". No document has been or will be
prepared or distributed in reliance on Rule 434 under the Act. No stop
order suspending the effectiveness of such Registration Statement or
any part thereof has been issued and no proceedings for that purpose
have been instituted or threatened by the Commission.
(ii) If the Effective Time of the Initial Registration Statement
is prior to the execution and delivery of this Agreement: (A) on the
Effective Date of the Initial Registration Statement, the Initial
Registration Statement conformed in all material respects to the
requirements of the Act and the rules and regulations of the
Commission ("Rules and
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Regulations") and did not include 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, (B) on the
Effective Date of the Additional Registration Statement (if any), each
Registration Statement conformed or will conform, in all material
respects to the requirements of the Act and the Rules and Regulations
and did not include, or will not include, any untrue statement of a
material fact and did not omit, or will not omit, to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading, and (C) on the date of this
Agreement, the Initial Registration Statement and, if the Effective
Time of the Additional Registration Statement is prior to the
execution and delivery of this Agreement, the Additional Registration
Statement each conforms, and at the time of filing of the Prospectus
pursuant to Rule 424(b) or (if no such filing is required) at the
Effective Date of the Additional Registration Statement in which the
Prospectus is included, and on each Closing Date (as hereinafter
defined), each Registration Statement and the Prospectus will conform,
in all material respects to the requirements of the Act and the Rules
and Regulations, and neither of such documents includes, or will
include, any untrue statement of a material fact or omits, or will
omit, to state any material fact required to be stated therein or
necessary to make the statements therein (in the case of the
Prospectus, in the light of the circumstances under which they were
made) not misleading. If the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of
this Agreement: on the Effective Date of the Initial Registration
Statement, and on each Closing Date, the Initial Registration
Statement and the Prospectus will conform in all material respects to
the requirements of the Act and the Rules and Regulations, neither of
such documents will include any untrue statement of a material fact or
will omit to state any material fact required to be stated therein or
necessary to make the statements therein (in the case of the
Prospectus, in the light of the circumstances under which they were
made) not misleading, and no Additional Registration Statement has
been or will be filed. The two preceding sentences do not apply to
statements in or omissions from a Registration Statement or the
Prospectus based upon written information furnished to the Company by
any Underwriter through the Representatives specifically for use
therein, it being understood and agreed that the only such information
is that described as such in Section 7(c) hereof.
(iii) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of New York and has the corporate power and authority to own, lease
and operate its properties and to conduct its business as described in
the Registration Statement and the Prospectus; and the Company is duly
qualified to transact business as a foreign corporation and is in good
standing in each jurisdiction in which the conduct of its business or
its ownership, leasing or operation of property requires such
qualification, except to the extent that the failure to be so
qualified or in good standing would not have a material adverse effect
on the Company and its subsidiaries, taken as a whole.
(iv) Exhibit 1 hereto sets forth all domestic subsidiaries (the
"Domestic Subsidiaries") and foreign subsidiaries (the "Foreign
Subsidiaries") of the Company which individually or on a consolidated
basis are material to the operations of the Company and its
subsidiaries and the conduct of their respective businesses
(collectively, "Material Subsidiaries"). Each Material Subsidiary of
the Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and is duly qualified to transact business as a foreign
corporation and is in good standing in each jurisdiction in which the
conduct of its business or its ownership, leasing or operation of
property requires such qualification, except to the extent that the
failure to be so qualified or in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as
a
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whole. All of the outstanding capital stock of each Material
Subsidiary has been duly authorized and validly issued, is fully paid
and non-assessable and is owned by the Company, directly or through
subsidiaries, free and clear of any mortgage, pledge, lien, security
interest, restriction upon voting or transfer, claim or encumbrance of
any kind; and there are no rights granted to or in favor of any third
party (whether acting in an individual, fiduciary or other capacity)
other than the Company to acquire any such capital stock, any
additional capital stock or any other securities of any Material
Subsidiary.
(v) The authorized capital stock of the Company conforms as to
legal matters in all material respects to the description thereof
contained in the Prospectus.
(vi) All outstanding shares of capital stock of the Company have
been duly authorized, are validly issued, fully paid and
non-assessable, have been issued in compliance with applicable Federal
and state securities laws and conform in all material respects to the
description thereof contained in the Prospectus; the Offered
Securities have been duly authorized and will be, when issued and paid
for in accordance with this Agreement, validly issued, fully paid and
non-assessable; the authorized and outstanding shares of capital stock
of the Company are as set forth in the Prospectus under the captions
"Capitalization" and "Description of Capital Stock"; and the
shareholders of the Company have no preemptive or similar rights with
respect to the Offered Securities or any other securities of the
Company and no further approval or authority of the shareholders or
the Board of Directors of the Company will be required for the
issuance and sale of the Offered Securities as contemplated by this
Agreement.
(vii) The Securities have been approved for listing on the Nasdaq
Stock Market's National Market.
(viii) Except as set forth in the Prospectus, there are no
outstanding (A) securities or obligations of the Company convertible
into or exchangeable for any capital stock of the Company, (B)
warrants, rights or options to subscribe for or purchase from the
Company any such capital stock or any such convertible or exchangeable
securities or obligations or (C) obligations of the Company to issue
such shares, any such convertible or exchangeable securities or
obligations, or any such warrants, rights or obligations. The
descriptions of the Company's stock option, stock bonus and other
stock plans or arrangements, and the options or other rights granted
and exercised thereunder, set forth in the Prospectus are accurate in
all material respects.
(ix) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes the legal, valid and binding
obligation of the Company enforceable against the Company in
accordance with its terms, except to the extent that (A)
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to
creditors' rights generally and by general principles of equity and
(B) rights to indemnity and contribution may be limited by Federal or
state securities laws or policies underlying such laws.
(x) The execution, delivery and performance of this Agreement by
the Company and the consummation of the transactions herein
contemplated have been duly authorized by all necessary corporate
action on the part of the Company and, to the extent required, its
shareholders and will not contravene any provision of the certificate
of incorporation, by-laws or other organizational documents of the
Company or any of its subsidiaries, or conflict with or result in a
breach or violation of any of the terms and provisions of, or
constitute a default under, or result in the creation or imposition of
any lien, charge or encumbrance upon any assets or properties of the
Company or any of its
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subsidiaries under, any statute, any rule, regulation, order or decree
of any governmental agency or body or any court having jurisdiction
over the Company or any of its subsidiaries or any of their
properties, assets or operations, or any indenture, mortgage, loan
agreement, note or other agreement or instrument for borrowed money,
any guarantee of any agreement or instrument for borrowed money or any
lease, permit, license or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the Company
or any such subsidiary is bound or to which any of the properties,
assets or operations of the Company or any such subsidiary is subject,
and the Company has full power and authority to authorize, issue and
sell the Offered Securities as contemplated by this Agreement.
(xi) No consent, approval, authorization, order, registration or
qualification of or with any third party (whether acting in an
individual, fiduciary or other capacity) or any court or government
agency or body, is required for the issuance and sale of the Offered
Securities or for the consummation of the other transactions
contemplated by this Agreement, including, without limitation, the
consummation by the Company of the transactions contemplated in the
Prospectus under the caption "Use of Proceeds", except such as have
been obtained and made under the Act and such as may be required under
state securities laws in connection with the offer and sale of the
Offered Securities.
(xii) Neither the Company nor any of its subsidiaries is in
violation of (A) its certificate of incorporation, by-laws or other
organizational documents or (B) any applicable law, ordinance,
administrative or governmental rule or regulation, except, with
respect to this clause (B), for such violations that would not, singly
or in the aggregate, have a material adverse effect on the condition
(financial or other), business, properties or results of operations of
the Company and its subsidiaries, taken as a whole, or (C) any order,
decree or judgment of any court or governmental agency or body having
jurisdiction over the Company or any subsidiary; and no event of
default or event that, but for the giving of notice or the lapse of
time or both, would constitute an event of default exists or, upon the
consummation by the Company of the transactions contemplated in the
Prospectus, including, without limitation, the transactions
contemplated in the Prospectus under the caption "Use of Proceeds"
will exist, under any indenture, mortgage, loan agreement, note or
other agreement or instrument for borrowed money, any guarantee of any
agreement or instrument for borrowed money or any lease, permit,
license or other agreement or instrument to which the Company or any
of its subsidiaries is a party or by which the Company or any such
subsidiary is bound or to which any of the properties, assets or
operations of the Company or any such subsidiary is subject.
(xiii) The Company and its subsidiaries have such certificates,
permits, licenses, franchises, consents, approvals, authorizations and
clearances ("Licenses") and are in compliance in all material respects
with all applicable laws and regulations of Federal, state, local and
foreign governmental or regulatory authorities as are necessary to
own, lease or operate their properties and to conduct their businesses
in the manner described in the Prospectus and all such Licenses are
valid and in full force and effect. The Company and its subsidiaries
are in compliance in all material respects with their respective
obligations under such Licenses and no event has occurred that allows,
or after notice or lapse of time would allow, revocation or
termination of such Licenses or violation of such laws or regulations.
(xiv) The Company and its subsidiaries own or have obtained valid
licenses for all trademarks used in connection with the sale of goods,
trademark registrations and trade names described in the Prospectus as
being owned, licensed or used by the Company or any of its
subsidiaries or that are necessary for the conduct of their businesses
as described in the Prospectus (collectively, "Trademarks") and
neither the Company nor any subsidiary is
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aware of any claim (or of any facts that would form a reasonable basis
for any claim) to the contrary or any challenge by any third party to
the rights of the Company or any of its subsidiaries with respect to
any such Trademarks or to the validity or scope of any such
Trademarks, which claims or challenges could, singly or in the
aggregate, reasonably be expected to have a material adverse effect on
the condition (financial or other), business, properties or results of
operations of the Company and its subsidiaries, taken as a whole; and
neither the Company nor any of its subsidiaries has any claim against
a third party with respect to the infringement by such third party of
any such Trademarks, which claims could, singly or in the aggregate,
reasonably be expected to have a material adverse effect on the
condition (financial or other), business, properties or results of
operations of the Company and its subsidiaries, taken as a whole. The
Company and its subsidiaries have a good faith belief in the
distinctiveness and enforceability of all trademarks and trade names
comprising the Trademarks. The trademarks CONCORD, CORUM, ESQ.,
ESQUIRE, MOVADO, PIAGET, MUSEUM, VIZIO, COACH and Museum watch dial
design (collectively, "Material Trademarks") are the only trademarks
owned or licensed by the Company or any of its subsidiaries in the
conduct of their businesses as described in the Prospectus which, if
not so owned or licensed, could, singly or in the aggregate, have a
material adverse effect on the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries, taken as a whole.
(xv) The Company and its subsidiaries have good and marketable
title to all properties (real and personal) owned by the Company and
its subsidiaries, free and clear of any mortgage, pledge, lien,
security interest, claim or encumbrance of any kind that may
materially interfere with the conduct of the business of the Company
and its subsidiaries, taken as a whole, and all properties held under
lease by the Company or its subsidiaries are held under valid,
subsisting and enforceable leases.
(xvi) The Company and its subsidiaries carry or are entitled to
the benefits of insurance in such amounts and covering such risks as
is generally maintained by companies of established repute engaged in
the same or similar business, and all such insurance is in full force
and effect.
(xvii) The properties, assets and operations of the Company and
its subsidiaries are in compliance in all material respects with all
applicable Federal, state, local and foreign laws, rules and
regulations, orders, decrees, judgments, permits and licenses relating
to public and worker health and safety and to the protection and
clean-up of the natural environment and activities or conditions
related thereto, including, without limitation, those relating to the
generation, handling, disposal, transportation or release of hazardous
materials (collectively, "Environmental Laws"). With respect to such
properties, assets and operations, including any previously owned,
leased or operated properties, assets or operations, there are no
past, present or, to the best knowledge of the Company, reasonably
anticipated future events, conditions, circumstances, activities,
practices, incidents, actions or plans of the Company or any of its
subsidiaries that may interfere with or prevent compliance or
continued compliance in all material respects with applicable
Environmental Laws. Neither the Company nor any of its subsidiaries is
the subject of any Federal, state, local or foreign investigation, and
neither the Company nor any of its subsidiaries has received any
notice or claim (or is aware of any facts that would form a reasonable
basis for any claim), nor entered into any negotiations or agreements
with any third party, relating to any liability or remedial action or
potential liability or remedial action under Environmental Laws, nor
are there any pending, reasonably anticipated or, to the best
knowledge of the Company, threatened actions, suits or proceedings
against or affecting the Company, any of its subsidiaries or their
properties, assets or operations, in connection with any such
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Environmental Laws. The term "hazardous materials" shall mean those
substances that are regulated by or form the basis for liability under
any applicable Environmental Laws.
(xviii) The Company and its subsidiaries have filed all Federal,
state, local and foreign tax returns required to be filed, such
returns are complete and correct in all material respects, and all
taxes shown by such returns or otherwise assessed or due and payable
have been paid, except such taxes as are being contested in good faith
and as to which adequate reserves have been provided. The charges,
accruals and reserves on the books of the Company and its subsidiaries
in respect of any tax liability for any year not finally determined
are adequate to meet any assessments or reassessments for additional
taxes; and there has been no tax deficiency asserted and the Company
is not aware of any facts that would form a reasonable basis for the
assertion of any tax deficiency against the Company or any of its
subsidiaries that could, singly or in the aggregate, have a material
adverse effect on the condition (financial or other), business,
properties or results of operations of the Company and its
subsidiaries, taken as a whole.
(xix) Neither the Company nor any of its subsidiaries maintain or
contribute to, or within the past five years have maintained or
contributed to, any plan that is a "single employer plan" as defined
in Section 4001(a)(15), or have or have had an obligation to
contribute to a "multiemployer plan" as defined in Section 4001(a)(3),
of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), and the regulations and published interpretations
thereunder as to which Title IV of ERISA applies, that could, singly
or in the aggregate, have a material adverse effect on the condition
(financial or other), business, properties or results of operations of
the Company and its subsidiaries, taken as a whole, and each "employee
benefit plan" (as defined in ERISA and the regulations and published
interpretations thereunder) in which employees of the Company or any
of its subsidiaries are eligible to participate is in compliance in
all material respects with the applicable provisions of ERISA and the
Internal Revenue Code of 1986, as amended (the "Code").
(xx) There are no pending actions, suits, proceedings or
investigations against or affecting the Company, any of its
subsidiaries or any of their properties, assets or operations that are
required under the Act to be described in the Prospectus or that
could, singly or in the aggregate, have a material adverse effect on
the condition (financial or other), business, properties or results of
operations of the Company and its subsidiaries, taken as a whole, or
could have a material adverse effect on the ability of the Company to
perform its obligations under this Agreement or that are otherwise
material in the context of the sale of the Offered Securities; and, to
the best knowledge of the Company, no such actions, suits, proceedings
or investigations are threatened or contemplated.
(xxi) No labor disturbance by the employees of the Company or any
of its subsidiaries exists, or to the best knowledge of the Company,
is threatened, and the Company is not aware of any existing or
imminent labor disturbance by the employees of its principal
suppliers, manufacturers or customers that could, singly or in the
aggregate, have a material adverse effect on the condition (financial
or other), business, properties or results of operations of the
Company and its subsidiaries, taken as a whole.
(xxii) The Company has not taken and will not take, directly or
indirectly, any action designed to or that could cause or result in
stabilization or manipulation of the price of the Offered Securities
and the Company has not distributed and will not distribute any
offering material in connection with the offering and sale of the
Offered Securities other than any preliminary prospectus filed with
the Commission or the Prospectus or other materials, if any, permitted
by the Act or the Rules and Regulations.
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(xxiii) There are no contracts, agreements or understandings
between the Company and any third party (whether acting in an
individual, fiduciary or other capacity) granting such third party the
right to require the Company to file a registration statement under
the Act with respect to any securities of the Company owned or to be
owned by such third party or to require the Company to include such
securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Act.
(xxiv) There are no statutes, regulations, contracts or other
documents that are required to be described in the Registration
Statement or the Prospectus or to be filed as an exhibit to the
Registration Statement that are not described or filed as required.
The contracts so described in the Prospectus are in full force and
effect and neither the Company or any of its subsidiaries nor, to the
best knowledge of the Company, any other party is in breach of or
default under any such contracts.
(xxv) Other than as contemplated by this Agreement and the fees
and expenses specified in Part II of the Registration Statement, there
is no broker, finder or other party that is entitled to receive from
the Company or any of its subsidiaries any brokerage or finder's fee
or any other fee, commission or payment as a result of the
transactions contemplated by this Agreement.
(xxvi) Price Waterhouse LLP, who are reporting upon the audited
financial statements and schedules included in the Registration
Statement and the Prospectus, are independent public accountants as
required by the Act and the Rules and Regulations.
(xxvii) The financial statements and related schedules and notes
included in the Registration Statement and the Prospectus comply in
all material respects with the requirements of the Act and the Rules
and Regulations, were prepared in accordance with generally accepted
accounting principles consistently applied throughout the periods
involved and fairly present the financial condition and results of
operations of the Company and its subsidiaries, on a consolidated
basis, at the dates and for the periods presented. The financial data
set forth in the Prospectus under the captions "Summary Historical
Financial Data," "Selected Historical Financial Data" and
"Capitalization" present fairly the information shown therein and the
historical financial data shown therein have been compiled on a basis
consistent with that of the audited consolidated financial statements
included in the Registration Statement.
(xxviii) The Company and its subsidiaries maintain a system of
internal accounting controls sufficient for purposes of the prevention
or detection of errors or irregularities in amounts that could be
expected to be material to the Company's consolidated financial
statements and the recording of transactions so as to permit the
preparation of such consolidated financial statements in conformity
with generally accepted accounting principles.
(xxix) Since the dates as of which information is given in the
Registration Statement and the Prospectus, (A) neither the Company nor
any of its subsidiaries has incurred any material liability or
obligation (indirect, direct or contingent) or entered into any
material oral or written agreement or other transaction that is not in
the ordinary course of business or that could reasonably be expected
to result in a material reduction in the future earnings of the
Company or its subsidiaries; (B) neither the Company nor any of its
subsidiaries has sustained any material loss or interference with its
business or properties from fire, flood, windstorm, accident or other
calamity (whether or not covered by insurance); (C) there has been no
material change in the indebtedness of the Company, no
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change in the capital stock of the Company and no dividend or
distribution of any kind declared, paid or made by the Company on any
class of its capital stock; and (D) there has been no material adverse
change, nor any development or event involving a prospective material
change, in the condition (financial or other), business, properties or
results of operations of the Company and its subsidiaries, taken as a
whole.
(xxx) The Company is not, and upon the sale of the Offered
Securities as herein contemplated and application of the net proceeds
from such sale as described in the Prospectus under the caption "Use
of Proceeds" will not be, an "investment company" within the meaning
of the Investment Company Act of 1940, as amended.
(xxxi) The Company is not now and has never been a "United States
real property holding corporation" as defined in Section 897(c)(2) of
the Code and the Treasury regulations promulgated thereunder.
(b) Each Selling Shareholder severally represents and warrants to, and
agrees with, the several Underwriters that:
(i) With respect to the GG & SG 1997 Charitable Remainder
Unitrust, such Selling Shareholder has been duly created, is validly
existing as a trust under the laws of the jurisdiction of its
organization and has the power and authority to own and sell its
property and to conduct its activities;
(ii) Such Selling Shareholder has and on each Closing Date
hereinafter mentioned will have valid and unencumbered title to the
Offered Securities to be delivered by such Selling Shareholder on such
Closing Date, except such encumbrances created by this Agreement and
the Custody Agreement and Power of Attorney (as defined below), and
full right, power and authority to enter into this Agreement and the
Custody Agreement and Irrevocable Power of Attorney entered into by
such Selling Shareholder in connection with the transactions
contemplated hereby (the "Custody Agreement and Power of Attorney")
and to sell, assign, transfer and deliver the Offered Securities to be
delivered by such Selling Shareholder on such Closing Date hereunder;
and upon the delivery of and payment for the Offered Securities on
each Closing Date hereunder in accordance with this Agreement the
several Underwriters will acquire valid and unencumbered title to the
Offered Securities to be delivered by such Selling Shareholder on such
Closing Date.
(iii) If the Effective Time of the Initial Registration Statement
is prior to the execution and delivery of this Agreement: (A) on the
Effective Date of the Initial Registration Statement, the Initial
Registration Statement conformed in all material respects to the
requirements of the Act and the Rules and Regulations and did not
include 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, (B) on the Effective Date of the
Additional Registration Statement (if any), each Registration
Statement conformed, or will conform, in all material respects to the
requirements of the Act and the Rules and Regulations and did not
include, or will not include, any untrue statement of a material fact
and did not omit, or will not omit, to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading, and (C) on the date of this Agreement, the
Initial Registration Statement and, if the Effective Time of the
Additional Registration Statement is prior to the execution and
delivery of this Agreement, the Additional Registration Statement each
conforms, and at the time of filing of the Prospectus pursuant to Rule
424(b) or (if no such filing is required) at the Effective Date of the
Additional Registration Statement in which the Prospectus is included,
and on each Closing Date, each Registration Statement and the
Prospectus will conform, in all material respects
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to the requirements of the Act and the Rules and Regulations, and
neither of such documents includes, or will include, any untrue
statement of a material fact or omits, or will omit, to state any
material fact required to be stated therein or necessary to make the
statements therein (in the case of the Prospectus, in the light of the
circumstances under which they were made) not misleading. If the
Effective Time of the Initial Registration Statement is subsequent to
the execution and delivery of this Agreement: on the Effective Date of
the Initial Registration Statement, and on each Closing Date, the
Initial Registration Statement and the Prospectus will conform in all
material respects to the requirements of the Act and the Rules and
Regulations, neither of such documents will include any untrue
statement of a material fact or will omit to state any material fact
required to be stated therein or necessary to make the statements
therein (in the case of the Prospectus, in the light of the
circumstances under which they were made) not misleading, and no
Additional Registration Statement has been or will be filed. The two
preceding sentences apply only to the extent that any statements in or
omissions from a Registration Statement or the Prospectus are based on
information furnished to the Company by such Selling Shareholder
specifically for use therein.
(iv) This Agreement and the Custody Agreement and Power of
Attorney have each been duly authorized, executed and delivered by or
on behalf of such Selling Shareholder and this Agreement and the
Custody Agreement and Power of Attorney each constitutes the legal,
valid and binding obligation of such Selling Shareholder enforceable
against such Selling Shareholder in accordance with its terms, except
to the extent that (A) enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating
to creditors' rights generally and by general principles of equity and
(B) rights to indemnity and contribution may be limited by Federal or
state securities laws or policies underlying such laws.
(v) No consent, approval, authorization, order, registration or
qualification of or with any third party (whether acting in an
individual, fiduciary or other capacity) or any court or government
agency or body is required to be obtained or made by such Selling
Shareholder for the sale of the Offered Securities or for the
consummation of the other transactions contemplated by this Agreement
and the Custody Agreement and Power of Attorney in connection with the
sale of the Offered Securities, except such as have been obtained and
made under the Act and such as may be required under state securities
laws in connection with the offer and sale of the Offered Securities.
(vi) The execution, delivery and performance of this Agreement
and the Custody Agreement and Power of Attorney by such Selling
Shareholder, and the sale of the Offered Securities being sold by such
Selling Shareholder and consummation by such Selling Shareholder of
the other transactions contemplated hereby will not contravene, if
applicable, any provisions of the certificate of incorporation,
by-laws, trust agreement or other organizational documents of such
Selling Shareholder, or conflict with or result in a breach or
violation of any of the terms and provisions of, or constitute a
default under, or result in the creation or imposition of any lien,
charge or encumbrance upon the Offered Securities to be sold by such
Selling Shareholder under any statute, any rule, regulation, order or
decree of any governmental agency or body or any court having
jurisdiction over such Selling Shareholder or any properties, assets
or operations of such Selling Shareholder, or any indenture, mortgage,
loan agreement, note or other agreement for borrowed money, any
guarantee of any agreement or instrument for borrowed money or any
lease, permit, license or other agreement or instrument to which such
Selling Shareholder is a party or by which such Selling Shareholder is
bound or to which any of the properties, assets or operations of such
Selling Shareholder is subject, and such Selling Shareholder has full
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power and authority to sell the Offered Securities to be sold by such
Selling Shareholder as contemplated by this Agreement.
(vii) There are no contracts, agreements or understandings
between such Selling Shareholder and any third party that would give
rise to a valid claim against such Selling Shareholder or any
Underwriter for a brokerage commission, finder's fee or other like
payment in connection with the transactions contemplated by this
Agreement and the Custody Agreement and Power of Attorney.
(viii) Such Selling Shareholder has not taken and will not take,
directly or indirectly, any action designed to or that could
reasonably be expected to cause or result in stabilization or
manipulation of the price of the Offered Securities, and such Selling
Shareholder has not distributed and will not distribute any offering
material in connection with the offering and sale of the Offered
Securities other than any preliminary prospectus filed with the
Commission or the Prospectus or other materials, if any, permitted by
the Act or the Rules and Regulations.
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 and each Selling
Shareholder agree, severally and not jointly, to sell to each Underwriter, and
each Underwriter agrees, severally and not jointly, to purchase from the Company
and each Selling Shareholder, at a purchase price of $[________] per share, that
number of Firm Securities (rounded up or down, as determined by Credit Suisse
First Boston Corporation ("CSFBC") in its discretion, in order to avoid
fractions) obtained by multiplying 1,500,000 Firm Securities in the case of the
Company, and the number of Firm Securities set forth opposite the name of such
Selling Shareholder in Schedule A hereto in the case of a Selling Shareholder,
in each case by a fraction the numerator of which is the number of Firm
Securities set forth opposite the name of such Underwriter in Schedule B hereto
and the denominator of which is the total number of Firm Securities.
Certificates in negotiable form for the Offered Securities to be sold
by the Selling Shareholders hereunder have been placed in custody, for delivery
under this Agreement, under the Custody Agreement and Power of Attorney made
with [_______________], as custodian ("Custodian"). Each Selling Shareholder
agrees that the shares represented by the certificates held in custody for the
Selling Shareholders under the Custody Agreement and Power of Attorney are
subject to the interests of the Underwriters hereunder, that the arrangements
made by the Selling Shareholders for such custody are to that extent
irrevocable, and that the obligations of the Selling Shareholders hereunder
shall not be terminated by operation of law, whether by the death of any
individual Selling Shareholder or the occurrence of any other event, or in the
case of a trust, by the death of any trustee or trustees or the termination of
such trust. If any individual Selling Shareholder or any such trustee or
trustees should die, or if any other such event should occur, or if any of such
trusts should terminate, before the delivery of the Offered Securities
hereunder, certificates for such Offered Securities shall be delivered by the
Custodian in accordance with the terms and conditions of this Agreement as if
such death or other event or termination had not occurred, regardless of whether
or not the Custodian shall have received notice of such death or other event or
termination.
The Company and the Custodian will deliver the Firm Securities to the
Representatives for the accounts of the Underwriters, against payment of the
purchase price in Federal (same day) funds by wire transfer to a bank acceptable
to CSFBC drawn to the order of the Company in the case of 1,500,000 shares of
Firm Securities and to the order of the Custodian in the case of 900,000 shares
of Firm Securities, at the office of Xxxxx Xxxxxxxxxx, 0000 Xxxxxx xx xxx
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 A.M., New York time, on October
[___], 1997, or at such other time not later than seven full business days
thereafter as CSFBC and the Company determine, such time being herein referred
to as the "First Closing Date". For purposes of Rule 15c6-1 under the Securities
Exchange Act of 1934, the First Closing Date (if later than the otherwise
applicable settlement date) shall be the settlement date for payment of funds
and delivery of
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securities for all the Offered Securities sold pursuant to the Offering. The
certificates for the Firm Securities so to be delivered will be in definitive
form, in such denominations and registered in such names as CSFBC requests and
will be made available for checking and packaging at the office of CSFBC, Xxxxxx
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000 at least 24 hours prior to the
First Closing Date.
In addition, upon written notice from CSFBC given to the Selling
Shareholder of the Optional Securities from time to time not more than 30 days
subsequent to the date of the Prospectus, the Underwriters may purchase all or
less than all of the Optional Securities at the purchase price per Security to
be paid for the Firm Securities. The Selling Shareholder agrees to sell to the
Underwriters the number of Optional Securities specified in such notice up to
the total number of Optional Securities set forth opposite the name of such
Selling Shareholder in Schedule A hereto. Such Optional Securities shall be
purchased from the Selling Shareholder for the account of each Underwriter in
the same proportion as the number of Firm Securities set forth opposite such
Underwriter's name bears to the total number of Firm Securities (subject to
adjustment by CSFBC to eliminate fractions) and may be purchased by the
Underwriters only for the purpose of covering over-allotments made in connection
with the sale of the Firm Securities. No Optional Securities shall be sold or
delivered unless the Firm Securities previously have been, or simultaneously
are, sold and delivered. The right to purchase the Optional Securities or any
portion thereof may be exercised from time to time and to the extent not
previously exercised may be surrendered and terminated at any time upon notice
by CSFBC to the Selling Shareholder of the Optional Securities.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "Optional Closing Date", which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "Closing Date"), shall be determined by CSFBC
but shall be not later than seven full business days after written notice of
election to purchase Optional Securities is given. The Custodian will deliver
the Optional Securities being purchased on each Optional Closing Date to the
Representatives for the accounts of the several Underwriters, against payment of
the purchase price therefor in Federal (same day) funds by wire transfer to a
bank acceptable to CSFBC drawn to the order of the Custodian, at the office of
Xxxxx Xxxxxxxxxx, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000. The
certificates for the Optional Securities being purchased on each Optional
Closing Date will be in definitive form, in such denominations and registered in
such names as CSFBC requests upon reasonable notice prior to such Optional
Closing Date and will be made available for checking and packaging at the office
of CSFBC, Xxxxxx Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000- 0000, at a reasonable
time in advance of (but in no event later than one business day preceding) such
Optional Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Offered Securities for sale to the public as
set forth in the Prospectus.
5. Certain Agreements of the Company and the Selling Shareholders. The
Company agrees with the several Underwriters and the Selling Shareholders and,
with respect to clauses (l), (m) and (n) below, the Selling Shareholders agree
with the Company and the several Underwriters that:
(a) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement, the Company will
file the Prospectus with the Commission pursuant to and in accordance with
subparagraph (1) (or, if applicable and if consented to by CSFBC,
subparagraph(4)) of Rule 424(b) not later than the earlier of (A) the
second business day following the execution and delivery of this Agreement
or (B) the fifteenth business day after the Effective Date of the Initial
Registration Statement. The Company will advise CSFBC promptly of any such
filing pursuant to Rule 424(b). If the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement and an additional registration statement is necessary to register
a portion of the Offered Securities under the Act but the Effective Time
thereof has not occurred as of such execution and delivery, the Company
will file the additional registration statement or, if filed, will file a
post-effective amendment thereto with the Commission pursuant to
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and in accordance with Rule 462(b) on or prior to 10:00 P.M., New York
time, on the date of this Agreement or, if earlier, on or prior to the time
the Prospectus is printed and distributed to any Underwriter, or will make
such filing at such later date as shall have been consented to by CSFBC.
(b) The Company will advise CSFBC promptly of any proposal to amend or
supplement the initial or any additional registration statement as filed or
the related prospectus or the Initial Registration Statement, the
Additional Registration Statement (if any) or the Prospectus and will not
effect such amendment or supplementation without CSFBC's prior consent; and
the Company will also advise CSFBC promptly of the effectiveness of each
Registration Statement (if the Effective Time is subsequent to the
execution and delivery of this Agreement) and of any amendment or
supplement to a Registration Statement or the Prospectus and of the
institution by the Commission of any stop order proceedings in respect of a
Registration Statement and will use its best efforts to prevent the
issuance of any such stop order and to obtain as soon as possible its
lifting, if issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with
sales by any Underwriter or dealer, any event occurs or a condition exists
as a result of which it is necessary, in the opinion of counsel to the
Underwriters or counsel to the Company, to amend the Registration Statement
or amend or supplement the Prospectus in order that the Prospectus would
not 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, not misleading, or
if it is necessary, in the opinion of either such counsel, at any time to
amend the Registration Statement or amend or supplement the Prospectus to
comply with the Act, the Company promptly will notify CSFBC of such event,
prepare and file with the Commission an amendment or supplement that will
correct such statement or omission or an amendment that will effect such
compliance. Neither CSFBC's consent to, nor the Underwriters' delivery of,
any such amendment or supplement shall constitute a waiver of any of the
conditions set forth in Section 6.
(d) As soon as practicable, but not later than the Availability Date
(as defined below), the Company will make generally available to its
securityholders an earnings statement covering a period of at least 12
months beginning after the Effective Date of the Initial Registration
Statement (or, if later, the Effective Date of the Additional Registration
Statement) which will satisfy the provisions of Section 11(a) of the Act
and Rule 158 thereunder. For the purpose of the preceding sentence,
"Availability Date" means the 45th day after the end of the fourth fiscal
quarter following the fiscal quarter that includes such Effective Date,
except that, if such fourth fiscal quarter is the last quarter of the
Company's fiscal year, "Availability Date" means the 90th day after the end
of such fourth fiscal quarter.
(e) The Company will furnish to the Representatives copies of each
Registration Statement (at least four of which will be signed and will
include all exhibits and a signed accountant's report of Price Waterhouse
LLP), each related preliminary prospectus and, so long as a prospectus
relating to the Offered Securities is required to be delivered under the
Act in connection with sales by any Underwriter or dealer, the Prospectus
and all amendments and supplements to such documents, in each case and in
such quantities as CSFBC reasonably requests. The Prospectus shall be so
furnished on or prior to 3:00 P.M., New York time, on the business day
following the later of the execution and delivery of this Agreement or the
Effective Time of the Initial Registration Statement. All other such
documents shall be so furnished as soon as available. The Company will pay
the expenses of printing and distributing to the Underwriters all such
documents.
(f) The Company will, in cooperation with the Representatives and
their counsel, arrange for the qualification of the Offered Securities for
sale under the laws of such jurisdictions as CSFBC may designate and will
continue such qualifications in effect so long as required for the
distribution thereof; provided, however, that in no event shall the Company
be obligated to qualify to do
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business in any jurisdiction where it is not currently so qualified or to
take any action that would subject it to general service of process in any
jurisdiction where it is not currently so subject.
(g) During the period of five years hereafter, the Company will
furnish to the Representatives and, upon request, to each of the other
Underwriters, as soon as practicable after the end of each fiscal year, a
copy of its annual report to shareholders for such year; and the Company
will furnish to the Representatives (i) as soon as available, a copy of
each report and any definitive proxy statement of the Company filed with
the Commission under the Securities Exchange Act of 1934, as amended, or
mailed to shareholders and (ii) from time to time, such other information
concerning the Company as CSFBC may reasonably request.
(h) The Company will not offer, sell, contract to sell, pledge, or
otherwise dispose of, directly or indirectly, or file or cause to be filed
with the Commission a registration statement under the Act (other than on
Form S-8) relating to, any shares of its Securities or other rights
convertible into or exchangeable or exercisable for any shares of its
Securities (including shares of Class A Common Stock $0.01 par value, of
the Company), or publicly disclose an intention to make any such offer,
sale, pledge, disposition or filing, without the prior written consent of
CSFBC, for a period of 120 days after the date of the Prospectus.
(i) The Company will use its best efforts to cause its officers and
directors and certain shareholders of the Company to agree with the
Representatives that each of such holders will not offer, sell, contract to
sell, pledge, or otherwise dispose of, directly or indirectly, or file or
cause to be filed with the Commission a registration statement under the
Act relating to, any shares of its Securities or other rights convertible
into or exchangeable or exercisable for any shares of its Securities
(including shares of Class A Common Stock), or publicly disclose an
intention to make any such offer, sale, pledge, disposition or filing,
without the prior written consent of CSFBC, for a period of 120 days after
the date of the Prospectus.
(j) The Company will apply the net proceeds of the offering and sale
of the Offered Securities contemplated hereunder in the manner set forth in
the Prospectus under the caption "Use of Proceeds."
(k) The Company will (i) furnish to each of the Representatives on the
First Closing Date (and thereafter to each Underwriter that so requests) a
certification, as contemplated by and in compliance with Treasury
regulations Section 1.897-2(h), that as of such First Closing Date (or such
other date as may be specified in such subsequent request), the Offered
Securities are not United States real property interests as defined in
Section 897(c)(1) of the Code, (ii) file such certification with the
Internal Revenue Service in the manner and within the time period specified
in Treasury regulations Section 1.897-2(h) and (iii) promptly after such
filing, furnish to each of the Representatives (or, if such certificate is
requested after the First Closing Date, to those Underwriters that have so
requested) proof of such filing.
(l) The Company will pay all expenses incident to the performance of
the obligations of the Company and each Selling Shareholder, other than the
registration fee payable to the Commission and the underwriting discounts
and commissions relating to the Offered Securities sold by the Selling
Shareholders (which fees, discounts and commissions will be paid by the
Selling Shareholders), under this Agreement and will reimburse the
Underwriters for any filing fees and other expenses (including reasonable
fees and disbursements of counsel) incurred by them in connection with the
qualification of the Offered Securities for sale under the laws of such
jurisdictions as CSFBC designates and the printing of memoranda relating
thereto, for the filing fee incident to, and the reasonable fees and
disbursements of counsel to the Underwriters in connection with, the review
by the National Association of Securities Dealers, Inc. of the Offered
Securities, for any travel expenses of the Company's officers and employees
and any other expenses of the Company in connection with attending or
hosting meetings with prospective purchasers of the Offered Securities, for
any travel expenses of the Company's officers and employees and any other
expenses of the Company in connection with attending or hosting meetings
with prospective purchasers of the Offered Securities, for any
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transfer taxes on the sale by the Selling Shareholders of the Offered
Securities to the Underwriters and for expenses incurred in printing and
distributing preliminary prospectuses and the Prospectus (including any
amendments and supplements thereto) or related documents.
(m) Each Selling Shareholder agrees to deliver to CSFBC (Attention:
Transactions Advisory Group) on or prior to the First Closing Date 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).
(n) Each Selling Shareholder agrees not to offer, sell, contract to
sell, pledge or otherwise dispose of, directly or indirectly, or file or
cause to be filed with the Commission a registration statement under the
Act relating to, any shares of its Securities or other rights convertible
into or exchangeable or exercisable for any shares of its Securities
(including shares of Class A Common Stock), or publicly disclose an
intention to make any such offer, sale, pledge, disposition or filing,
without the prior written consent of CSFBC, for a period of 120 days after
the date of the Prospectus.
6. Conditions of the Obligations of the Underwriters. The obligations
of the several Underwriters to purchase and pay for the Firm Shares on the First
Closing Date and the Optional Securities to be purchased on each Optional
Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company and the Selling Shareholders herein, to
the accuracy of the statements of Company officers made pursuant to the
provisions hereof, to the performance by the Company and the Selling
Shareholders of their obligations hereunder and to the following additional
conditions precedent:
(a) The Representatives shall have received a letter, dated the date
of delivery thereof (which, if the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement, shall be on or prior to the date of this Agreement or, if the
Effective Time of the Initial Registration Statement is subsequent to the
execution and delivery of this Agreement, shall be prior to the filing of
the amendment or post-effective amendment to the registration statement to
be filed shortly prior to such Effective Time), of Price Waterhouse LLP
confirming that they are independent public accountants within the meaning
of the Act and the applicable published Rules and Regulations thereunder
and stating to the effect that:
(i) in their opinion the financial statements and schedules
examined by them and included in the Registration Statements comply as
to form in all material respects with the applicable accounting
requirements of the Act and the related published Rules and
Regulations;
(ii) they have performed the procedures specified by the American
Institute of Certified Public Accountants for a review of interim
financial information as described in Statement of Auditing Standards
No. 71, Interim Financial Information, on the unaudited financial
statements included in the Registration Statements;
(iii) on the basis of the review referred to in clause (ii)
above, a reading of the latest available interim financial statements
of the Company, a reading of the minutes of all meetings of the
shareholders and directors (including each committee thereof) of the
Company and its subsidiaries, inquiries of officials of the Company
who have responsibility for financial and accounting matters and other
specified procedures, nothing came to their attention that caused them
to believe that:
(A) the unaudited financial statements included in the
Registration Statements and the Prospectus do not comply as to
form in all material respects with the applicable accounting
requirements of the Act and the related published Rules and
Regulations or any material modifications should be made to such
unaudited
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financial statements for them to be in conformity with generally
accepted accounting principles;
(B) the information set forth in the Prospectus under the
captions "Summary Historical Financial Data" and "Selected
Historical Financial Data" does not agree with the amounts set
forth in the unaudited consolidated financial statements or the
audited consolidated financial statements, as the case may be,
from which it was derived or were not determined on a basis
substantially consistent with that of the corresponding amounts
in the audited statements included in the Registration Statements
and the Prospectus;
(C) at the date of the latest available balance sheet read
by such accountants, or at a subsequent specified date not more
than three business days prior to the date of this Agreement,
there was any decrease in shareholders' equity or change in the
capital stock or any increase in short-term indebtedness or
long-term debt of the Company and its consolidated subsidiaries
or, at the date of the latest available balance sheet read by
such accountants, there was any decrease in consolidated net
current assets or net assets, as compared with amounts shown on
the latest balance sheet included in the Registration Statements
and the Prospectus; or
(D) for the period from the closing date of the latest
income statement included in the Registration Statements and the
Prospectus to the closing date of the latest available income
statement read by such accountants there were any decreases, as
compared with the corresponding period of the previous year and
with the period of corresponding length ended the date of the
latest income statement included in the Registration Statements
and the Prospectus, in consolidated net sales or operating
income, or in the total or per share amounts of income from
continuing operations or net income;
except in all cases set forth in clauses (C) and (D) above for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter;
(iv) they have compared specified dollar amounts (or percentages
derived from such dollar amounts), numerical data and other financial
information contained in the Registration Statements and the
Prospectus (in each case to the extent that such dollar amounts,
percentages, numerical data and other financial information are
derived from the general accounting records of the Company and its
subsidiaries subject to the internal controls of the Company's
accounting system or are derived directly from such records by
analysis or computation) with the results obtained from inquiries, a
reading of such general accounting records and other procedures
specified in such letter and have found such dollar amounts,
percentages, numerical data and other financial information to be in
agreement with such results.
For purposes of this subsection, (i) if the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of this
Agreement, "Registration Statements" shall mean the initial registration
statement as proposed to be amended by the amendment or post-effective amendment
to be filed shortly prior to its Effective Time, (ii) if the Effective Time of
the Initial Registration Statement is prior to the execution and delivery of
this Agreement but the Effective Time of the Additional Registration Statement
is subsequent to such execution and delivery, "Registration Statements" shall
mean the Initial Registration Statement and the additional registration
statement as proposed to be filed or as proposed to be amended by the
post-effective amendment to be filed shortly prior to its Effective Time, and
(iii) "Prospectus" shall mean the prospectus included in the Registration
Statements. All financial statements and schedules included in material
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incorporated by reference into the Prospectus shall be deemed to be included in
the Registration Statements for purposes of this subsection.
(b) If the Effective Time of the Initial Registration Statement is not
prior to the execution and delivery of this Agreement, such Effective Time
shall have occurred not later than 10:00 P.M., New York time, on the date
of this Agreement or such later date as shall have been consented to by
CSFBC. If the Effective Time of the Additional Registration Statement (if
any) is not prior to the execution and delivery of this Agreement, such
Effective Time shall have occurred not later than 10:00 P.M., New York
time, on the date of this Agreement or, if earlier, the time the Prospectus
is printed and distributed to any Underwriter, or shall have occurred at
such later date as shall have been consented to by CSFBC. If the Effective
Time of the Initial Registration Statement is prior to the execution and
delivery of this Agreement, the Prospectus shall have been filed with the
Commission in accordance with the Rules and Regulations and Section 5(a) of
this Agreement. Prior to such Closing Date, no stop order suspending the
effectiveness of a Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or, to the
knowledge of any Selling Shareholder, the Company or the Representatives,
shall be contemplated by the Commission.
(c) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred (i) any change, or any development or event
involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Company or any of its
subsidiaries which, in the judgment of a majority in interest of the
Underwriters including the Representatives, is material and adverse and
makes it impractical or inadvisable to proceed with completion of the
public offering or the sale of and payment for the Offered Securities; (ii)
any downgrading in the rating of any debt securities of the Company by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Act), or any public announcement that any
such organization has under surveillance or review its rating of any debt
securities of the Company (other than an announcement with positive
implications of a possible upgrading, and no implication of a possible
downgrading, of such rating); (iii) any suspension or limitation of trading
in securities generally on the New York Stock Exchange, or any setting of
minimum prices for trading on such exchange, or any suspension of trading
of any securities of the Company on any exchange or in the over-the-counter
market; (iv) any banking moratorium declared by U.S. Federal, New York or
Swiss authorities; or (v) any outbreak or escalation of major hostilities
in which the United States or Switzerland is involved, any declaration of
war by Congress or any other substantial national or international calamity
or emergency if, in the judgment of a majority in interest of the
Underwriters including the Representatives, the effect of any such
outbreak, escalation, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the public
offering or the sale of and payment for the Offered Securities.
(d) The Representatives shall have received an opinion, dated such
Closing Date, of Xxxx, Xxxxx, Xxxxxxx, Xxxxxxx & Xxxxxxxx, counsel for the
Company, to the effect that:
(i) The Company has been duly incorporated and is a validly
existing corporation in good standing under the laws of the State of
New York, with corporate power and authority to own, lease and operate
its properties and conduct its business as described in the
Registration Statements and the Prospectus;
(ii) The Offered Securities to be delivered by the Company on
such Closing Date have been duly authorized and will be, when issued
and paid for in accordance with this Agreement, validly issued, fully
paid and non-assessable; the authorized shares of capital stock of the
Company, including the Offered Securities, are as set forth in the
Prospectus under the caption "Capitalization" and conform as to legal
matters to the descriptions thereof contained in the Prospectus and
the form of certificates for the Offered Securities conforms to the
requirements of the New York Business Corporation Law; the issuance of
the Offered
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Securities to be delivered by the Company is not subject to preemptive
or other similar rights arising by operation of law, under the
certificate of incorporation or by-laws of the Company or, to the
knowledge of such counsel, under any agreement to which the Company is
a party or to which it is subject; and no further approval or
authority of the shareholders or the Board of Directors of the Company
will be required for the issuance and sale of the Offered Securities
to be delivered by the Company as contemplated by this Agreement;
(iii) To the knowledge of such counsel, except as set forth in
the Prospectus, there are no outstanding (A) securities or obligations
of the Company convertible into or exchangeable for any capital stock
of the Company, (B) warrants, rights or options to subscribe for or
purchase from the Company any such capital stock or any such
convertible or exchangeable securities or obligations or (C)
obligations of the Company to issue such shares, any such convertible
or exchangeable securities or obligations, or any such warrants,
rights or obligations;
(iv) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes the legal, valid and binding
obligation of the Company enforceable against the Company in
accordance with its terms, except to the extent that (A)
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to
creditors' rights generally and by general principles of equity
(regardless of whether enforceability is considered in a proceeding at
law or in equity) and (B) rights to indemnity and contribution may be
limited by Federal or state securities laws or policies underlying
such laws;
(v) The execution, delivery and performance of this Agreement by
the Company and the consummation of the transactions herein
contemplated have been duly authorized by all necessary corporate
action on the part of the Company and, to the extent required, its
shareholders and will not contravene any provision of the certificate
of incorporation or by-laws of the Company or, to the knowledge of
such counsel, conflict with or result in a breach or violation of any
of the terms and provisions of, or constitute a default under, or
result in the creation or imposition of any lien, charge or
encumbrance upon any assets or properties of the Company under, any
statute, any rule, regulation, order or decree of any governmental
agency or body or any court having jurisdiction over the Company or
any of its properties, assets or operations, or any indenture,
mortgage, loan agreement, note or other agreement or instrument for
borrowed money, any guarantee of any agreement or instrument for
borrowed money or any lease, permit, license or other agreement or
instrument to which the Company is a party or by which the Company is
bound or to which any of the properties, assets or operations of the
Company is subject; and the Company has full power and authority to
authorize, issue and sell the Offered Securities as contemplated by
this Agreement;
(vi) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body or,
to the knowledge of such counsel, any third party (whether acting in
an individual, fiduciary or other capacity) is required for the
issuance and sale of the Offered Securities by the Company or for the
consummation of the other transactions contemplated by this Agreement,
including, without limitation, the consummation by the Company of the
transactions contemplated in the Prospectus under the caption "Use of
Proceeds", except such as have been obtained and made under the Act
and such as may be required under state securities laws in connection
with the offer and sale of the Offered Securities;
(vii) To the knowledge of such counsel, the Company is not (A) in
violation of (i) its certificate of incorporation or by-laws or (ii)
any applicable law, ordinance, administrative
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or governmental rule or regulation, except, with respect to this
clause (ii), for such violations that would not, singly or in the
aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole, or (iii) any order, decree or judgment
of any court or governmental agency or body having jurisdiction over
the Company or (B) in default in the performance or observance of any
material obligation, agreement or condition in any indenture,
mortgage, loan agreement, note or other agreement or instrument for
borrowed money, any guarantee of any agreement or instrument for
borrowed money or any lease, permit, license or other agreement or
instrument to which the Company is a party or by which the Company is
bound or to which any of the properties, assets or operations of the
Company is subject;
(viii) There are no pending or, to the knowledge of such counsel,
threatened actions, suits, proceedings or investigations against or
affecting the Company or any of its properties, assets or operations
that could, singly or in the aggregate, have a material adverse effect
on the Company and its subsidiaries, taken as a whole;
(ix) To the knowledge of such counsel, there are no contracts,
agreements or understandings between the Company and any third party
(whether acting in an individual, fiduciary or other capacity)
granting such third party the right to require the Company to file a
registration statement under the Act with respect to any securities of
the Company owned or to be owned by such third party or to require the
Company to include such securities in the securities registered
pursuant to the Registration Statements or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Act;
(x) The descriptions in the Registration Statements and the
Prospectus of statutes, regulations, legal and governmental
proceedings or investigations and contracts and other documents fairly
present in all material respects the information required to be shown;
and, to the knowledge of such counsel, there are no statutes,
regulations or legal or governmental proceedings or investigations
required to be described in the Registration Statements or the
Prospectus that are not described as required or could have a material
adverse effect on the ability of the Company to perform its
obligations under this Agreement or of any contracts or documents of a
character required to be described in the Registration Statements or
the Prospectus or to be filed as exhibits to the Registration
Statements that are not described and filed as required; it being
understood that such counsel need express no opinion as to the
financial statements and schedules or other financial data included in
or omitted from the Registration Statements and the Prospectus;
(xi) The Company is not, and upon sale of the Offered Securities
as contemplated by this Agreement and application of the net proceeds
of such sale as described in the Prospectus under the caption "Use of
Proceeds" will not be, an "investment company" within the meaning of
the Investment Company Act of 1940, as amended;
(xii) The Initial Registration Statement was declared effective
under the Act as of the date and time specified in such opinion, the
Additional Registration Statement (if any) was filed and became
effective under the Act as of the date and time (if determinable)
specified in such opinion, the Prospectus either was filed with the
Commission pursuant to the subparagraph of Rule 424(b) specified in
such opinion on the date specified therein or was included in the
Initial Registration Statement or the Additional Registration
Statement (as the case may be), and, to the best knowledge of such
counsel, no stop order suspending the effectiveness of a Registration
Statement or any part thereof has been issued and no proceedings for
that purpose have been instituted or are pending or contemplated under
the Act; and
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(xiii) The Registration Statements and the Prospectus, and each
amendment or supplement thereto, as of their respective effective or
issue dates, and in the case of the Prospectus and each amendment or
supplement thereto as of the Closing Date, complied as to form in all
material respects with the requirements of the Act and the Rules and
Regulations; and, although such counsel have not undertaken to
determine independently, and are not passing upon and do not assume
any responsibility for, the accuracy, completeness or fairness of the
contents of the Registration Statements or the Prospectus, in
connection with the preparation of the Registration Statements and the
Prospectus such counsel have participated in conferences with
representatives and counsel for the Underwriters and with certain
officers and employees of, and counsel and independent certified
public accountants for, the Company, at which conferences the contents
of the Registration Statements and the Prospectus and related matters
were discussed, and no facts have come to such counsel's attention
that lead such counsel to believe (relying as to materiality on the
statements of officers and other representatives of the Company) that
any part of a Registration Statement or any amendment thereto, as of
its effective date or as of such Closing Date, 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 such amendment
or supplement, as of its issue date or as of such Closing Date, as the
case may be, contained any 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, not misleading; it being understood that such counsel need
express no opinion as to the financial statements and schedules or
other financial data included in or omitted from the Registration
Statement and the Prospectus.
Such opinion shall be to such further effect with respect to other
legal matters relating to this Agreement and the transactions contemplated
hereby as the Representatives and counsel to the Underwriters may reasonably
request. In rendering such opinion, Xxxx, Xxxxx, Xxxxxxx, Xxxxxxx & Xxxxxxxx may
rely as to all matters governed by the laws of jurisdictions other than the laws
of the State of New York and the Federal laws of the United States upon the
opinions of counsel reasonably satisfactory to the Representatives.
(e) The Representatives shall have received an opinion, dated such
Closing Date, of Xxxxxxxx & Xxxxxxxx, counsel for the Selling Shareholders,
to the effect that:
(i) To the best knowledge of such counsel, each Selling
Shareholder is the record and beneficial owner of the Offered
Securities delivered by such Selling Shareholder on such Closing Date
and has full right, power and authority to enter into this Agreement,
the Custody Agreement and Power of Attorney and to sell, assign,
transfer and deliver the Offered Securities delivered by such Selling
Shareholder on such Closing Date; and, to the best knowledge of such
counsel, upon the delivery of and payment for the Offered Securities
on such Closing Date the several Underwriters will have acquired valid
and unencumbered title to the Offered Securities delivered by such
Selling Shareholder on such Closing Date;
(ii) This Agreement and the Custody Agreement and Power of
Attorney have each been duly authorized, executed and delivered by
such Selling Shareholder and each constitutes the legal, valid and
binding obligation of such Selling Shareholder enforceable against
such Selling Shareholder in accordance with its terms, except to the
extent that (A) enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating
to creditors' rights generally and by general principles of equity and
(B) rights to indemnity and contribution may be limited by Federal or
state securities laws or policies underlying such laws;
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(iii) To the best knowledge of such counsel, no consent,
approval, authorization, order, registration or qualification of or
with any third party (whether acting in an individual, fiduciary or
other capacity) or any court or government agency or body is required
to be obtained or made by such Selling Shareholder for the sale of the
Offered Securities or for the consummation of the other transactions
contemplated by this Agreement and the Custody Agreement and Power of
Attorney in connection with the sale of the Offered Securities, except
such as have been obtained and made under the Act and such as may be
required under state securities laws in connection with the offer and
sale of the Offered Securities; and
(iv) The execution, delivery and performance of this Agreement
and the Custody Agreement and Power of Attorney by such Selling
Shareholder, and the sale of the Offered Securities being sold by such
Selling Shareholder and consummation by such Selling Shareholder of
the other transactions contemplated hereby will not contravene, if
applicable, any provisions of the certificate of incorporation,
by-laws, trust agreement or other organizational documents of such
Selling Shareholder, or conflict with or result in a breach or
violation of any of the terms and provisions of, or constitute a
default under, or result in the creation or imposition of any lien,
charge or encumbrance upon the Offered Securities to be sold by such
Selling Shareholder under, to the best knowledge of such counsel, any
statute, any rule, regulation, order or decree of any governmental
agency or body or any court having jurisdiction over such Selling
Shareholder or any properties, assets or operations of such Selling
Shareholder, or any indenture, mortgage, loan agreement, note, or
other agreement for borrowed money, any guarantee of any agreement or
instrument for borrowed money or any lease, permit, license or other
agreement or instrument to which such Selling Shareholder is a party
or by which such Selling Shareholder is bound or to which any of the
properties, assets or operations of such Selling Shareholder is
subject, and such Selling Shareholder has full power and authority to
sell the Offered Securities to be sold by such Selling Shareholder as
contemplated by this Agreement.
Such opinion shall be to such further effect with respect to other
legal matters relating to the Selling Shareholders and the transactions
contemplated hereby as the Representatives and counsel to the Underwriters
may reasonably request. In rendering such opinion, such counsel may rely as
to matters governed by the laws of jurisdictions other than the laws of New
York and the Federal laws of the United States upon the opinions of counsel
reasonably satisfactory to the Representatives.
(f) The Representatives shall have received an opinion, dated such
Closing Date, of Xxxxxxx X. Xxxxxx, general counsel for the Company, to the
effect that:
(i) The Domestic Subsidiary has been duly incorporated and is a
validly existing corporation in good standing under the laws of the
jurisdiction of its incorporation, with corporate power and authority
to own, lease and operate its properties and to conduct its business
as described in the Registration Statements and the Prospectus;
(ii) Each of the Company and the Domestic Subsidiary is duly
qualified to transact business as a foreign corporation in good
standing in all other jurisdictions in which it owns, leases or
operates properties or in which the conduct of its business or its
ownership, leasing or operation of property requires such
qualification, except to the extent that the failure to be so
qualified or in good standing would not have a material adverse effect
on the Company and its subsidiaries, taken as a whole;
(iii) All of the outstanding capital stock of the Domestic
Subsidiary has been duly authorized and validly issued, is fully paid
and non-assessable and is owned by the Company, directly or through
subsidiaries, free and clear of any mortgage, pledge, lien,
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security interest, restriction upon voting or transfer, claim or
encumbrance of any kind; and there are no rights granted to or in
favor of any third party (whether acting in an individual, fiduciary
or other capacity) other than the Company to acquire any such capital
stock, any additional capital stock or any other securities of the
Domestic Subsidiary;
(iv) All outstanding shares of capital stock of the Company have
been duly authorized, are validly issued, are fully paid and
non-assessable and, to the best knowledge of such counsel, have been
issued in compliance with applicable Federal and state securities
laws; the outstanding shares of capital stock of the Company are as
set forth in the Prospectus under the caption "Capitalization" and
conform to the descriptions thereof contained in the Prospectus; and
the securityholders of the Company have no preemptive or similar
rights with respect to any securities of the Company;
(v) The execution, delivery and performance of this Agreement by
the Company and the consummation of the transactions herein
contemplated will not contravene any provision of the certificate of
incorporation, by-laws or other organizational documents of any of the
Company's subsidiaries or conflict with or result in a breach or
violation of any of the terms and provisions of, or constitute a
default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any assets or properties of any of the
Company's subsidiaries under, any statute, any rule, regulation, order
or decree of any governmental agency or body or any court having
jurisdiction over any such subsidiaries or any of their respective
properties, assets or operations, or any indenture, mortgage, loan
agreement, note or other agreement or instrument for borrowed money,
any guarantee of any agreement or instrument for borrowed money or any
lease, permit, license or other agreement or instrument to which any
such subsidiary is a party or by which any such subsidiary is bound or
to which any of the properties, assets or operations of any such
subsidiary is subject;
(vi) No consent, approval, authorization, order, registration or
qualification of or with any third party (whether acting in an
individual, fiduciary or other capacity) or any court or governmental
agency or body of the jurisdiction of incorporation of any of the
Company's subsidiaries is required for the issuance and sale of the
Offered Securities or for the consummation by the Company of the
transactions contemplated in the Prospectus, including, without
limitation, the consummation by the Company of the transactions
contemplated in the Prospectus under the caption "Use of Proceeds",
except such as have been obtained and made under the Act and such as
may be required under state securities laws in connection with the
offer and sale of the Offered Securities;
(vii) The Domestic Subsidiary is not (A) in violation of (i) its
certificate of incorporation, by-laws or other organizational
documents or (ii) any applicable law, ordinance, administrative or
governmental rule or regulation, except, with respect to this clause
(ii), for such violations that would not, singly or in the aggregate,
have a material adverse effect on the Company and its subsidiaries,
taken as a whole, or (iii) any order, decree or judgment of any court
or governmental agency or body having jurisdiction over the Domestic
Subsidiary or (B) in default in the performance or observance of any
material obligation, agreement or condition in any indenture,
mortgage, loan agreement, note or other agreement or instrument for
borrowed money, any guarantee of any agreement or instrument for
borrowed money or any lease, permit, license or other agreement or
instrument to which the Domestic Subsidiary is a party or by which the
Domestic Subsidiary is bound or to which any of the properties, assets
or operations of the Domestic Subsidiary is subject;
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(viii) There are no pending or, to the best knowledge of such
counsel, threatened actions, suits, proceedings or investigations
against or affecting any of the Company's subsidiaries or any of their
respective properties, assets or operations that could, singly or in
the aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole; and
(ix) Such counsel has no reason to believe that any part of a
Registration Statement or any amendment thereto, as of its effective
date or as of such Closing Date, 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 such amendment or
supplement, as of its issue date or as of such Closing Date, as the
case may be, contained any 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, not misleading; it being understood that such counsel need
express no opinion as to the financial statements and schedules or
other financial data contained in the Registration Statement and the
Prospectus.
(x) To the best knowledge of such counsel, the Company and its
subsidiaries own or have obtained valid licenses for all Material
Trademarks and such counsel is not aware, after due inquiry, of any
claim (or any facts that would form a reasonable basis for any claim)
to the contrary or any challenge by any third party to the rights of
the Company or any of its subsidiaries with respect to any such
Material Trademarks or to the validity or scope of any such Material
Trademarks, which claims or challenges could, singly or in the
aggregate, reasonably be expected to have a material adverse effect on
the Company and its subsidiaries, taken as a whole. In addition,
neither the Company nor any of its subsidiaries has any claim against
a third party with respect to infringement by such third party of any
such Material Trademarks, which claims could, singly or in the
aggregate, reasonably be expected to have a material adverse effect on
the Company and its subsidiaries, taken as a whole; and
(xi) Such counsel is of the opinion that (A) all Material
Trademarks are distinctive and enforceable with respect to the
products described in the Prospectus as using such Material Trademarks
and (B) the statements in the Prospectus pertaining to the Material
Trademarks, including, without limitation, those statements appearing
in the Prospectus under the captions "Risk Factors - Dependence on
Certain Trademarks and Licensing Agreements" and "Business -
Trademarks and Licensing Agreements" are accurate and fairly present
the information purported to be shown insofar as such statements
relate to legal matters.
Such opinion shall be to such further effect with respect to other
legal matters relating to this Agreement and the transactions contemplated
hereby as the Representatives and counsel to the Underwriters may reasonably
request. In rendering such opinion, such general counsel may rely as to matters
governed by the laws of jurisdictions other than the laws of the State of New
York, the corporate laws of the State of Delaware and the Federal laws of the
United States upon the opinions of counsel reasonably satisfactory to the
Representatives.
(g) The Representatives shall have received opinions, dated such
Closing Date, of foreign counsel to the Company, to the effect that:
(i) Each of the Foreign Subsidiaries has been duly incorporated
and is a validly existing corporation in good standing under the laws
of the jurisdiction of its incorporation, with corporate power and
authority to own, lease and operate its properties and conduct its
business as described in the Registration Statements and the
Prospectus; and each of the
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Foreign Subsidiaries is duly qualified to transact business as a
foreign corporation in good standing in all other jurisdictions in
which it owns, leases or operates properties or in which the conduct
of its business or its ownership, leasing or operation of property
requires such qualification, except to the extent that the failure to
be so qualified or in good standing would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole;
(ii) All of the outstanding capital stock of each of the Foreign
Subsidiaries has been duly authorized and validly issued, is fully
paid and non-assessable and is owned by the Company, directly or
through subsidiaries, free and clear of any mortgage, pledge, lien,
security interest, restriction upon voting or transfer, claim or
encumbrance of any kind; and there are no rights granted to or in
favor of any third party (whether acting in an individual, fiduciary
or other capacity) other than the Company to acquire any such capital
stock, any additional capital stock or any other securities of any
Foreign Subsidiary;
(iii) The execution, delivery and performance of this Agreement
by the Company and the consummation of the transactions herein
contemplated will not contravene any provision of the certificate of
incorporation, by-laws or other organizational documents of any of the
Foreign Subsidiaries or conflict with or result in a breach or
violation of any of the terms and provisions of, or constitute a
default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any assets or properties of any of the
Foreign Subsidiaries under, any statute, any rule, regulation, order
or decree of any governmental agency or body or any court having
jurisdiction over any of the Foreign Subsidiaries or any of their
properties, assets or operations or any indenture, mortgage, loan
agreement, note or other agreement or instrument for borrowed money,
any guarantee of any agreement or instrument for borrowed money or any
lease, permit, license or other agreement or instrument to which any
of the Foreign Subsidiaries is a party or by which any such Foreign
Subsidiary is bound or to which any of the properties, assets or
operations of any such Foreign Subsidiary is subject;
(iv) No consent, approval, authorization, order, registration or
qualification of or with any third party (whether acting in an
individual, fiduciary or other capacity) or any court or governmental
agency or body of the jurisdiction of incorporation of any of the
Foreign Subsidiaries is required for the issuance and sale of the
Offered Securities or for the consummation by the Company of the
transactions contemplated in the Prospectus, including, without
limitation, the consummation of the transactions contemplated in the
Prospectus under the caption "Use of Proceeds";
(v) None of the Foreign Subsidiaries is in violation of its
certificate of incorporation, by-laws or other organizational
documents or, to the best knowledge of such counsel, any applicable
law, ordinance, administrative or governmental rule or regulation, or
any order, decree or judgment of any court or governmental agency or
body having jurisdiction over any Foreign Subsidiary or, to the best
knowledge of such counsel, in default in the performance or observance
of any material obligation, agreement or condition in any indenture,
mortgage, loan agreement, note or other agreement or instrument for
borrowed money, any guarantee of any agreement or instrument for
borrowed money or any lease, permit, license or other agreement or
instrument to which any of the Foreign Subsidiaries is a party or by
which any such Foreign Subsidiary is bound or to which any of the
properties, assets or operations of any such Foreign Subsidiary is
subject; and
(vi) There are no pending or, to the best knowledge of such
counsel, threatened actions, suits, proceedings or investigations
against or affecting any of the Foreign Subsidiaries or any of their
properties, assets or operations that could, singly or in the
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aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole;
(h) The Representatives shall have received from Xxxxx Xxxxxxxxxx LLP,
counsel for the Underwriters, such opinion or opinions, dated such Closing
Date, with respect to the validity of the Offered Securities delivered on
such Closing Date, the Registration Statement, the Prospectus and other
related matters as the Representatives may require, and the Selling
Shareholders and the Company shall have furnished to such counsel such
documents or certificates as they reasonably request for the purpose of
enabling them to pass upon such matters.
(i) The Representatives shall have received a certificate, dated such
Closing Date, of the President or any Executive Vice President and a
principal financial or accounting officer of the Company in which such
officers, to the best of their knowledge after reasonable investigation,
shall state that (A) the representations and warranties of the Company in
this Agreement are true and correct on and as of the date of this Agreement
and such Closing Date, (B) the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied hereunder
at or prior to such Closing Date, (C) no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are contemplated by
the Commission at or prior to such Closing Date, (D) they have carefully
examined the Registration Statements and the Prospectus and no part of any
Registration Statement nor the Prospectus or any amendment or supplement
thereto, as of their respective effective or issue dates, contained any
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein,
in the case of the Prospectus in the light of the circumstances under which
such statements were made, not misleading, (E) subsequent to the dates as
of which information is given in the Registration Statements and the
Prospectus, there has been no material adverse change, nor any development
or event involving a prospective material adverse change, in the condition
(financial or other), business, properties or results of operations of the
Company and its subsidiaries, taken as a whole, and (F) the Additional
Registration Statement (if any) satisfying the requirements of
subparagraphs (1) and (3) of Rule 462(b) was filed pursuant to Rule 462(b),
including payment of the applicable filing fee in accordance with Rule
111(a) or (b) under the Act, prior to the time the Prospectus was printed
and distributed to any Underwriter.
(j) The Representatives shall have received a letter, dated such
Closing Date, of Price Waterhouse LLP which meets the requirements of
subsection (a) of this Section, except that the specified date referred to
in such subsection will be a date not more than three business days prior
to such Closing Date for the purposes of this subsection.
(k) The Representatives shall have received written undertakings of
the officers and directors and certain shareholders of the Company to the
effect contemplated in subsection (i) of Section 5 hereof, unless otherwise
waived or agreed to by CSFBC.
(l) The Representatives shall have received such other opinions,
certificates, letters and other documents from or on behalf of the Company
and the Selling Shareholders as the Representatives shall reasonably
request.
All such opinions, certificates, letters and other documents will be
in compliance with the provisions hereof only if they are reasonably
satisfactory in form and substance to CSFBC and counsel for the Underwriters.
The Company and the Selling Shareholders will furnish the Representatives with
such conformed copies of such opinions, certificates, letters and documents as
the Representatives reasonably request. CSFBC may in its sole discretion waive
on behalf of the Underwriters compliance with any conditions to the obligations
of the Underwriters hereunder, whether in respect of an Optional Closing Date or
otherwise.
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7. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities (or actions in respect
thereof), joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained in any Registration Statement, the Prospectus, or any amendment
or supplement thereto, or any related preliminary prospectus, 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 in order to make
the statements therein, in the case of the Prospectus, any amendment or
supplement thereto, or any related preliminary prospectus in the light of
the circumstances under which such statements were made, 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 loss, claim, damage, liability or action as such
expenses are incurred; provided, however, that the Company will 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 in or omission or alleged omission from any of such
documents in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through the Representatives
specifically for use therein, it being understood and agreed that the only
such information furnished by any Underwriter consists of the information
described as such in subsection (c) below; and provided, further, that with
respect to any untrue statement or alleged untrue statement in or omission
or alleged omission from any preliminary prospectus that is corrected in
the Prospectus, the foregoing indemnity agreement shall not inure to the
benefit of any Underwriter from whom the person asserting any such loss,
claim, damage or liability purchased the Offered Securities to the extent
that such loss, claim, damage or liability of such Underwriter results from
the fact that there was not sent or given to such person, if required by
law so to have been sent or given, at or prior to written confirmation of
the sale of such Offered Securities to such person, a copy of the
Prospectus if the Company previously had furnished copies thereof in
requisite quantities to such Underwriter.
Insofar as the foregoing indemnity agreement, or the representations
and warranties contained in Section 2(a)(ii), may permit indemnification
for liabilities under the Act of any person who is an Underwriter or a
partner or controlling person of an Underwriter within the meaning of
Section 15 of the Act and who, at the date of this Agreement, is a
director, officer or controlling person of the Company, the Company has
been advised that in the opinion of the Commission such provisions may
contravene Federal public policy as expressed in the Act and may therefore
be unenforceable. In the event that a claim for indemnification under such
agreement or such representations and warranties for any such liabilities
(except insofar as such agreement provides for the payment by the Company
of expenses incurred or paid by a director, officer or controlling person
in the successful defense of any action, suit or proceeding) is asserted by
such a person, the Company will submit to a court of appropriate
jurisdiction (unless in the opinion of counsel of the Company the matter
has already been settled by controlling precedent) the question of whether
or not indemnification by it for such liabilities is against public policy
as expressed in the Act and therefore unenforceable, and the Company will
be governed by the final adjudication of such issue.
(b) The Selling Shareholders, 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,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in any Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any related preliminary prospectus, or
arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein, in the case of the
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Prospectus, any amendment or supplement thereto, or any related preliminary
prospectus in the light of the circumstances under which such statements
were made, 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 loss, claim, damage,
liability or action as such expenses are incurred; provided, however, that
the Selling Shareholders will be liable in any such case only 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 in or omission or
alleged omission from any of such documents in reliance upon and in
conformity with written information furnished to the Company by the Selling
Shareholders specifically for use therein; and provided, further, that with
respect to any untrue statement or alleged untrue statement in or omission
or alleged omission from any preliminary prospectus the indemnity agreement
contained in this subsection (b) shall not inure to the benefit of any
Underwriter from whom the person asserting any such losses, claims, damages
or liabilities purchased the Offered Securities concerned, to the extent
that a prospectus relating to such Offered Securities was required to be
delivered by such Underwriter under the Act in connection with such
purchase and any such loss, claim, damage or liability of such Underwriter
results from the fact that there was not sent or given to such person, at
or prior to the written confirmation of the sale of such Offered Securities
to such person, a copy of the Prospectus correcting such untrue statement
or alleged untrue statement in or omission or alleged omission from such
preliminary prospectus if the Company had previously furnished such
quantity of copies thereof to such Underwriter as reasonably by or on
behalf of such Underwriter.
(c) Each Underwriter, severally and not jointly, will indemnify and
hold harmless the Company and each Selling Shareholder against any losses,
claims, damages or liabilities (or actions in respect thereof) to which the
Company and such Selling Shareholder may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in any
Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus, or arise out of or are
based upon the omission or the alleged omission to state therein a material
fact required to be stated therein or necessary in order to make the
statements therein, in the case of the Prospectus, any amendment or
supplement thereto, or any related preliminary prospectus in the light of
the circumstances under which such statements were made, not misleading, in
each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in
reliance upon and in conformity with written information furnished to the
Company by such Underwriter through the Representatives specifically for
use therein, and will reimburse any legal or other expenses reasonably
incurred by the Company and each Selling Shareholder in connection with
investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred, it being understood and agreed that
the only information in the Prospectus furnished on behalf of any
Underwriter consists of the following information: the last paragraph at
the bottom of the cover page concerning the terms of the offering by the
Underwriters; the legend concerning over-allotments, stabilizing and
passive market making on the inside front cover page; and the concession
and reallowance figures appearing in the third paragraph and the seventh
paragraph under the caption "Underwriting".
(d) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against an indemnifying party
under subsection (a), (b) or (c) above, notify the indemnifying party of
the commencement thereof; but the omission so to notify the indemnifying
party will not relieve it from any liability that it may have to any
indemnified party under subsection (a), (b) or (c) above, except to the
extent that the indemnifying party is materially prejudiced by reason of
such omission. In case any such action is brought against any indemnified
party and it notifies an indemnifying party of the commencement thereof,
the indemnifying party will be entitled to participate therein and, to the
extent that it may wish, jointly with any other indemnifying party
similarly notified, to assume the
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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 will not be liable to such indemnified party under
this Section for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without the
prior written consent of the indemnified party (which consent shall not be
unreasonably withheld), effect any settlement of any pending or threatened
action in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified
party unless such settlement includes an unconditional release of such
indemnified party from all liability on any claims that are the subject
matter of such action.
(e) If the indemnification provided for in this Section is unavailable
or insufficient to hold harmless an indemnified party under subsection (a),
(b) or (c) above, then each indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a), (b) or (c)
above (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Selling Shareholders on the one
hand and the Underwriters on the other from the offering of the Offered
Securities or (ii) 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 and the Selling Shareholders 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 as well as any other relevant equitable considerations. The
relative benefits received by the Company and the Selling Shareholders 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 (before
deducting expenses) received by the Company and the Selling Shareholders
bear to the total underwriting discounts and commissions received by the
Underwriters. 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, the Selling Shareholders or the
Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission. The amount paid by an indemnified party as a result of the
losses, claims, damages or liabilities referred to in the first sentence of
this subsection (e) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim that is the subject of this
subsection (e). Notwithstanding the provisions of this subsection (e), no
Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Offered Securities
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages that such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this
subsection (e) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(f) The obligations of the Company and the Selling Shareholders under
this Section shall be in addition to any liability that the Company and the
Selling Shareholders may otherwise have 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 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 director of the Company, to each officer of
the Company who has signed the Registration Statement and to each person,
if any, who controls the Company within the meaning of the Act.
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8. Default of Underwriters. If any Underwriter or Underwriters default
in their obligations to purchase Securities hereunder on either the First or any
Optional Closing Date and the aggregate number of shares of Offered Securities
that such defaulting Underwriter or Underwriters agreed but failed to purchase
does not exceed 10% of the total number of shares of Offered Securities that the
Underwriters are obligated to purchase on such Closing Date, CSFBC may make
arrangements satisfactory to the Company and the Selling Shareholders for the
purchase of such Offered Securities by other persons, including any of the
Underwriters, but if no such arrangements are made by such Closing Date, the
non-defaulting Underwriters shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Offered Securities that such
defaulting Underwriters agreed but failed to purchase on such Closing Date. If
any Underwriter or Underwriters so default and the aggregate number of shares of
Offered Securities with respect to which such default or defaults occur exceeds
10% of the total number of shares of Offered Securities that the Underwriters
are obligated to purchase on such Closing Date and arrangements satisfactory to
CSFBC, the Company and the Selling Shareholders for the purchase of such Offered
Securities by other persons are not made within 36 hours after such default,
this Agreement will terminate without liability on the part of any
non-defaulting Underwriter, the Company or the Selling Shareholders, except as
provided in Section 9 (provided that if such default occurs with respect to
Optional Securities after the First Closing Date, this Agreement will not
terminate as to the Firm Securities or any Optional Securities purchased prior
to such termination). As used in this Agreement, the term "Underwriter" includes
any person substituted for an Underwriter under this Section. Nothing herein
will relieve a defaulting Underwriter from liability for its default.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Selling Shareholders, of the Company or its officers and of the several
Underwriters set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation, or statement as to the
results thereof, made by or on behalf of any Underwriter, any Selling
Shareholder, the Company or any of their respective representatives, officers or
directors or any controlling person, and will survive delivery of and payment
for the Offered Securities. If this Agreement is terminated pursuant to Section
8 or if for any reason the purchase of the Offered Securities by the
Underwriters is not consummated, the Company and the Selling Shareholders shall
remain responsible for the expenses to be paid or reimbursed by them pursuant to
Section 5 and the respective obligations of the Company, the Selling
Shareholders, and the Underwriters pursuant to Section 7 shall remain in effect,
and if any Offered Securities have been purchased hereunder the representations
and warranties in Section 2 and all obligations under Section 5 shall also
remain in effect. If the purchase of the Offered Securities by the Underwriters
is not consummated for any reason other than solely because of the termination
of this Agreement pursuant to Section 8 or the occurrence of any event specified
in clause (iii), (iv) or (v) of Section 6(c), the Company and the Selling
Shareholders will, jointly and severally, reimburse the Underwriters for all
out-of-pocket expenses (including fees and disbursements of counsel) reasonably
incurred by them in connection with the Offered Securities.
10. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed
to the Representatives, c/o Credit Suisse First Boston Corporation, Xxxxxx
Xxxxxxx Xxxxxx, Xxx Xxxx, X.X. 10010-3629, Attention: Investment Banking
Department - Transactions Advisory Group, or, if sent to the Company or the
Selling Shareholders, will be mailed, delivered or telegraphed confirmed to such
party c/o Movado Group, Inc., 000 Xxxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxxxx 00000,
Attention: Xxxxxxx X. Xxxxxx, Esq., with a copy to Xxxx, Xxxxx, Rifkind, Xxxxxxx
& Xxxxxxxx, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Xxxxxx X. Xxxxxx, Esq.; provided, however, that any notice to an Underwriter
pursuant to Section 7 will be mailed, delivered or telegraphed and confirmed to
such Underwriter.
11. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective personal representatives
and successors and the officers and directors and controlling persons referred
to in Section 7, and no other person will have any right or obligation
hereunder.
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12. Representation. The Representatives will act for the several
Underwriters in connection with the transactions contemplated by this Agreement,
and any action under this Agreement taken by the Representatives jointly or by
CSFBC will be binding upon all the Underwriters. The Custodian will act for the
Selling Shareholders in connection with such transactions, and any action under
or in respect of this Agreement taken by the Custodian will be binding upon all
the Selling Shareholders.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAWS.
The Company and the Selling Shareholders hereby submit to the
non-exclusive jurisdiction of the Federal and state courts in the Borough of
Manhattan in The City of New York in any suit or proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby.
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If the foregoing is in accordance with the Representatives' understanding of our
agreement, kindly sign and return to the Company one of the counterparts hereof,
whereupon it will become a binding agreement among the Selling Shareholders, the
Company and the several Underwriters in accordance with its terms.
Very truly yours,
MOVADO GROUP, INC.
By ________________________________________
Xxxxxx Xxxxxxxx
President
SELLING SHAREHOLDERS:
GEDALIO XXXXXXXX
XX and SG 1997 CHARITABLE REMAINDER UNITRUST
By ________________________________________
Name:
Title: Attorney-in-fact
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
XXXXXX XXXX LLC
XXXXXX & XXXXXXX, INC.
Acting on behalf of themselves and as the
Representatives of the several Underwriters.
By CREDIT SUISSE FIRST BOSTON CORPORATION
By __________________________________________
Xxxx X. Xxxxxx
Managing Director
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SCHEDULE A
SELLING SHAREHOLDER NUMBER OF NUMBER OF
------------------- FIRM OPTIONAL
SECURITIES SECURITIES TO
TO BE SOLD BE SOLD
---------- -------------
Xxxxxxx Xxxxxxxx.................................... 634,500 240,000
GG and SG 1997 Charitable Remainder Unitrust ....... 265,500 --
------- -------
Total....................................... 900,000 240,000
======= =======
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SCHEDULE B
UNDERWRITER NUMBER OF FIRM
----------- SECURITIES TO
BE PURCHASED
--------------
Credit Suisse First Boston Corporation...............
Xxxxxx Xxxx LLC......................................
Xxxxxx & Xxxxxxx, Inc. ..............................
---------
Total........................................... 2,400,000
=========
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EXHIBIT 1
MATERIAL SUBSIDIARIES
NAME OF DOMESTIC SUBSIDIARY JURISDICTION OF INCORPORATION
SwissAm, Inc. New Jersey
NAME OF FOREIGN SUBSIDIARY JURISDICTION OF INCORPORATION
Concord Watch Company, S.A. Switzerland
Movado Watch Company, S.A. Switzerland
34
