Exhibit 1.1
5,100,000 Shares
PROQUEST COMPANY
Common Stock, par value $.001 per share
UNDERWRITING AGREEMENT
June __, 2002
Credit Suisse First Boston Corporation,
Banc of America Securities LLC
Bear, Xxxxxxx & Co. Inc.
U.S. Bancorp Xxxxx Xxxxxxx Inc.
Xxxxxxxxx & Company, Inc.
AS REPRESENTATIVES OF THE SEVERAL UNDERWRITERS,
C/O CREDIT SUISSE FIRST BOSTON CORPORATION
ELEVEN XXXXXXX XXXXXX
XXX XXXX, XX 00000-0000
Dear Sirs:
1. Introductory. ProQuest Company, a Delaware corporation ("Company"),
proposes to issue and sell 3,000,000 shares of its common stock, par value
$0.001 per share, ("Securities") and the stockholders listed in Schedule A
hereto ("Selling Stockholders"), propose to sell an aggregate of 2,100,000
outstanding shares of the Securities (such 5,100,000 shares of Securities being
hereinafter referred to as the "Firm Securities"). The Company also proposes to
sell to the Underwriters, at the option of the Underwriters, an aggregate of not
more than 701,898 additional shares of its Securities and certain of the Selling
Stockholders also propose to sell to the Underwriters, at the option of the
Underwriters, an aggregate of not more than 63,102 additional outstanding shares
of the Securities, as set forth below (such 765,000 additional shares being
hereinafter referred to as the "Optional Securities"). The Firm Securities and
the Optional Securities are herein collectively called the "Offered Securities."
The Company and the Selling Stockholders hereby agree with the several
Underwriters named in Schedule B hereto ("Underwriters") as follows:
2. Representations and Warranties of the Company and the Selling
Stockholders.
(a) The Company represents and warrants to, and agrees with, the several
Underwriters that:
(ii) A registration statement (No. 333-86434) 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 ("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 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
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information 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 information
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.
(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 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, 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 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, 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
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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 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 Selling Stockholder or any Underwriter through the
Representative specifically for use therein, it being understood and agreed
that the only such information is that described as such in Section 7(b)
(with respect to the Selling Stockholders) and Section 7(c) (with respect
to the Underwriters) hereof.
(iii) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own its properties and conduct its
business as described in the Prospectus; and the Company is duly qualified
to do business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the conduct of
its business requires such qualification, except where the failure to be so
qualified or in good standing would not have a material adverse effect on
the condition (financial or otherwise), business, properties or results of
operations of the Company and its subsidiaries, taken as a whole (a
"Material Adverse Effect").
(iv) Each subsidiary of the Company listed on Schedule C (the
"Subsidiaries") hereto has been duly incorporated and is an existing
corporation in good standing under the laws of the jurisdiction of its
incorporation, with corporate power and authority to own its properties and
conduct its business as described in the Prospectus except where the
failure to be in good standing or to have the power and authority to own
its properties and conduct its business would not have a Material Adverse
Effect; each Subsidiary of the Company is duly qualified to do business as
a foreign corporation in good standing in all other jurisdictions in which
its ownership or lease of property or the conduct of its business requires
such qualification except where the failure to be so qualified or in good
standing would not have a Material Adverse Effect; all of the issued and
outstanding capital stock of each Subsidiary of the Company has been duly
authorized and validly issued and is fully paid and nonassessable; and, the
capital stock of each Subsidiary owned by the Company, directly or through
Subsidiaries, is owned free from liens, encumbrances and defects except for
liens in connection with the credit agreement described in the Prospectus
(the "Credit Agreement").
(v) The Offered Securities and all other outstanding shares of capital
stock of the Company have been duly authorized and will be validly issued,
fully paid and nonassessable and conform in all material respects to the
description thereof incorporated in the Prospectus; provided that the
Offered Securities to be sold by the Company will be validly issued and
fully paid for when issued and paid for in accordance with this Agreement.
The stockholders of the Company have no preemptive rights with respect to
the Securities.
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(vi) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person that would
give rise to a valid claim against the Company or any Underwriter for a
brokerage commission, finder's fee or other like payment in connection with
the offer and sale of the Offered Securities pursuant to this Agreement.
(vii) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person granting
such person the right to require the Company to file a registration
statement under the Act with respect to any securities of the Company owned
or to be owned by such person or to require the Company to include such
securities in the Offered Securities registered pursuant to a Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Act.
(viii) The Securities are listed on The New York Stock Exchange.
(ix) No consent, approval, authorization, or order of, or filing with,
any governmental agency or body or any court is required to be obtained or
made by the Company for the consummation of the sale of the Offered
Securities as contemplated by this Agreement, except such as have been
obtained and made under the Act and such as may be required under state
securities laws.
(x) The execution, delivery and performance by the Company of this
Agreement, and the consummation by the Company of the transactions herein
contemplated will not result in a breach or violation of any of the terms
and provisions of, or constitute a default under; (1) any statute, any
rule, regulation or order of any governmental agency or body or any court,
domestic or foreign, having jurisdiction over the Company or any Subsidiary
of the Company or any of their properties; (2) any agreement or instrument
to which the Company or any such Subsidiary is a party or by which the
Company or any such Subsidiary is bound or to which any of the properties
of the Company or any such Subsidiary is subject; or (3) the charter or
by-laws of the Company or any such Subsidiary, except in the cases of (1)
or (2) above, where such breach, violation, default or conflict would not
have a Material Adverse Effect.
(xi) This Agreement has been duly authorized, executed and delivered
by the Company.
(xii) Except as disclosed in the Prospectus, the Company and its
Subsidiaries have good and marketable title to all real properties and all
other properties and assets owned by them, in each case free from liens,
encumbrances and defects, except for liens related to the Credit Agreement,
or liens, claims, and encumbrances that would not have a Material Adverse
Effect; and except as disclosed in the Prospectus and except as would not
have a Material Adverse Effect, the Company and its Subsidiaries hold any
leased
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real or personal property under valid and enforceable leases with no
exceptions that would materially interfere with the use made or to be made
thereof by them.
(xiii) The Company and its Subsidiaries possess adequate certificates,
authorities or permits issued by appropriate governmental agencies or
bodies necessary to conduct the business now operated by them, except to
the extent such lack of possession would not have a Material Adverse
Effect, and the Company has not received any notice of proceedings relating
to the revocation or modification of any such certificate, authority or
permit that, if determined adversely to the Company or any of its
Subsidiaries, would individually or in the aggregate have a Material
Adverse Effect.
(xiv) No labor dispute with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent that
would have a Material Adverse Effect.
(xv) The Company and its Subsidiaries own, possess or can acquire on
reasonable terms, adequate trademarks, trade names and other rights to
material inventions, know-how, patents, copyrights, confidential
information and other intellectual property (collectively, "intellectual
property rights") necessary to conduct the business now operated by them,
or presently employed by them, and have not received any notice of
infringement of or conflict with asserted rights of others with respect to
any intellectual property rights that, if determined adversely to the
Company or any of its subsidiaries, would individually or in the aggregate
have a Material Adverse Effect.
(xvi) Except as disclosed in the Prospectus, neither the Company nor
any of its Subsidiaries is in violation of any statute, rule, regulation,
decision or order of any governmental agency or body or any court, domestic
or foreign, relating to the use, disposal or release of hazardous or toxic
substances or relating to the protection or restoration of the environment
or human exposure to hazardous or toxic substances (collectively,
"environmental laws"), owns or operates any real property contaminated with
any substance that is subject to any environmental laws, is liable for any
off-site disposal or contamination pursuant to any environmental laws, or
is subject to any claim relating to any environmental laws, which
violation, contamination, liability or claim would individually or in the
aggregate have a Material Adverse Effect; and the Company is not aware of
any pending investigation that might lead to such a claim.
(xvii) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Company, any of its
Subsidiaries or any of their respective properties that, if determined
adversely to the Company or any of its Subsidiaries, would individually or
in the aggregate have a Material Adverse Effect, or would materially and
adversely affect 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 Company's knowledge, no such
actions, suits or proceedings are threatened or contemplated.
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(xviii) The financial statements included in each Registration
Statement and the Prospectus present fairly in all material respects the
financial position of the Company and its consolidated subsidiaries as of
the dates shown and their results of operations and cash flows for the
periods shown, and, except as disclosed in the Prospectus, such financial
statements have been prepared in conformity with the generally accepted
accounting principles in the United States applied on a consistent basis.
(xix) Except as disclosed in the Prospectus, since the date of the
latest audited financial statements included in the Prospectus, there has
been no material adverse change, nor to the Company's knowledge, 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,
except as disclosed in or contemplated by the Prospectus, there has been no
dividend or distribution of any kind declared, paid or made by the Company
on any class of its capital stock.
(xx) The Company is subject to the reporting requirements of either
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 and
files reports with the Commission on the Electronic Data Gathering,
Analysis, and Retrieval (XXXXX) system.
(xxi) The Company is not and, after giving effect to the offering and
sale of the Offered Securities and the application of the proceeds thereof
as described in the Prospectus, will not be an "investment company" as
defined in the Investment Company Act of 1940.
(b) Each Selling Stockholder severally (and not jointly) represents and
warrants to, and agrees with, the several Underwriters that:
(i) Such Selling Stockholder has and on each Closing Date hereinafter
mentioned will have valid and unencumbered title to the Offered Securities
to be delivered by such Selling Stockholder on such Closing Date and full
right, power and authority to enter into this Agreement and to sell,
assign, transfer and deliver the Offered Securities to be delivered by such
Selling Stockholder on such Closing Date hereunder; and upon the delivery
of and payment for the Offered Securities on each Closing Date hereunder
the several Underwriters will acquire valid and unencumbered title to the
Offered Securities to be delivered by such Selling Stockholder on such
Closing Date.
(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 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
did not include, or will not include, any untrue statement of a material
fact and did not omit, or
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will not omit, to state any material fact required to be stated therein or
necessary to makethe statements therein not misleading, and (C) on the date
of this Agreement, neither the Initial Registration Statement and, if the
Effective Time of the Additional Registration Statement is prior to the
execution and delivery of this Agreement, nor the Additional Registration
Statement, at the Effective Date of the Additional Registration Statement,
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) 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 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, the Initial Registration Statement and the Prospectus will not
include any untrue statement of a material fact or will not omit to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading. The two preceding sentences apply only
to statements under the caption "Principal and Selling Stockholders"
contained in the Registration Statement or the Prospectus that relate to
such Selling Stockholder and that are based upon written information
furnished by such Selling Stockholder, it being understood and agreed that
the only such information is that described as such in Section 7(b) hereof.
(iii) Except as described in the Prospectus, no consent, approval,
authorization or order of, or filing with, any governmental agency or body
or any court is required to be obtained or made for the consummation by
such Selling Stockholder of sale of Offered Securities as contemplated by
this Agreement, except such as have been or will be obtained or made prior
to the First Closing Date.
(iv) The execution, delivery and performance by such Selling
Stockholder of this Agreement, the Power of Attorney appointing certain
individuals as such Selling Stockholder's attorneys-in-fact with respect to
the transactions therein contemplated (the "Power of Attorney") and the
Custody Agreement between such Selling Stockholder and ProQuest Company, as
Custodian ("Custodian"), relating to the deposit of Offered Securities to
be sold by such Selling Stockholder (the "Custody Agreement"), the sale of
the Offered Securities to be sold by such Selling Stockholder and the
consummation by such Selling Stockholder of any of the other transactions
herein contemplated, do not and will not conflict with or result in a
breach or violation of any of the terms and provisions of, or constitute or
will constitute a default (or an event which with the giving of notice or
the lapse of time or both would constitute a default) under, or result in
the creation or imposition of any lien, charge or encumbrance upon the
Offered Securities under (A) the trust agreement of such Selling
Stockholder (if such Selling Stockholder is a trust) , (B) any statute,
rule, regulation, requirement, order or decree of any governmental agency
or body of any court having jurisdiction over such Selling Stockholder or
any of its properties, assets or operations or (C) any indenture, mortgage,
loan or credit agreement, note, lease, permit, license or other agreement
or instrument to which such Selling Stockholder is a party or by which such
Selling Stockholder is bound or to which any of the properties, assets or
operations of such Selling Stockholder is subject, except in the
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case of clauses (B) and (C), any such event that does not materially
adversely affect the ability of such Selling Stockholder to consummate the
transactions contemplated hereunder.
(v) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between such Selling Stockholder and any
person that would give rise to a valid claim against such Selling
Stockholder or any Underwriter for a brokerage commission, finder's fee or
other like payment in connection with the offer and sale of the Offered
Securities pursuant to this Agreement.
(vi) The Power of Attorney and related Custody Agreement with respect
to such Selling Stockholder has been duly authorized (with respect to
Selling Stockholders that are trusts or corporations), executed and
delivered by such Selling Stockholder and constitute valid and legally
binding obligations of such Selling Stockholder enforceable in accordance
with their terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar law of general applicability
relating to or affecting creditors' rights and to general equity
principles.
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 Stockholder
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 Stockholder, 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 3,000,000 Firm Securities in the case of the Company and the
number of Firm Securities set forth opposite the name of such Selling
Stockholder in Schedule A hereto, in the case of a Selling Stockholder, 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 Stockholders hereunder have been placed in custody, for delivery
under this Agreement, under Custody Agreements made with the Custodian. Each
Selling Stockholder agrees that the shares represented by the certificates held
in custody for the Selling Stockholders under such Custody Agreements are
subject to the interests of the Underwriters hereunder, that the arrangements
made by the Selling Stockholders for such custody are to that extent
irrevocable, and that the obligations of the Selling Stockholders hereunder
shall not be terminated by operation of law, whether by the death of any
individual Selling Stockholder, or in the case of a corporation, by the
dissolution, insolvency or bankruptcy of any corporation. If any individual
Selling Stockholder should die, or if any of such corporation should dissolve or
become insolvent or bankrupt, 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, dissolution, insolvency or bankruptcy or other event or termination
had not occurred,
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regardless of whether or not the Custodian shall have received notice of such
death, dissolution, insolvency or bankruptcy.
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 accounts at banks
designated by the Company and the Selling Stockholders, drawn to the order of
the Company in the case of 3,000,000 shares of Firm Securities and the Selling
Stockholders in the case of each of their respective amounts of 2,100,000 shares
of Firm Securities, at the Chicago office of XxXxxxxxx, Will & Xxxxx, at 9:00
A.M., New York time, on June __, 2002, or at such other time not later than
seven full business days thereafter as CSFBC, the Company and the Selling
Stockholders 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 securities for
all the Offered Securities sold pursuant to the offering. Any 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 above offices at least 24 hours
prior to the First Closing Date.
In addition, upon written notice from CSFBC given to the Company and the
Selling Stockholders 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 Company and the Selling Stockholders agree, severally and
not jointly, to sell to the Underwriters the respective numbers of Optional
Securities obtained by multiplying the number of Optional Securities specified
in such notice by a fraction the numerator of which is 701,898 in the case of
the Company and the number of shares set forth opposite the names of such
Selling Stockholders in Schedule A hereto under the caption "Number of Optional
Securities to be Sold" in the case of the Selling Stockholders and the
denominator of which is the total number of Optional Securities (subject to
adjustment by CSFBC to eliminate fractions). Such Optional Securities shall be
purchased from the Company and each Selling Stockholder 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 Company and the Selling Stockholders.
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 five full business days after written notice of
election to purchase Optional Securities is given. The Company and the Custodian
will deliver the
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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 official bank check
or checks or wire transfer to an account at a bank acceptable to CSFBC drawn to
the order of the Company in the case of 701,898 Optional Securities and the
Custodian in the case of 63,102 Optional Securities, at the Chicago office of
XxXxxxxxx, Will & Xxxxx. 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 above office at a reasonable time in advance of
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 Stockholders. The
Company agrees with the several Underwriters and the Selling Stockholders 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 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 consent which shall not be
unreasonably withheld; and the Company will also advise CSFBC promptly of the
effectiveness of each Registration Statement (if its Effective Time is
subsequent to the execution and delivery of this Agreement) and of any amendment
or supplementation of 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 reasonable best efforts to prevent the
issuance of any such stop order and to obtain as soon as possible its lifting,
if issued.
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(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 as a result of which the Prospectus as
then amended or supplemented would include an untrue statement of a material
fact or omit to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, or if it is necessary at any time to amend the Prospectus to comply
with the Act, the Company will promptly notify CSFBC of such event and will
promptly prepare and file with the Commission, at its own expense, 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) that will satisfy the
provisions of Section 11(a) of the Act. 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 (five of which will be signed and will include all
exhibits), 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 in such quantities as
CSFBC requests. The Prospectus shall be so furnished in New York 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 arrange for the qualification of the Offered
Securities for sale under the laws of such jurisdictions as CSFBC designates and
will continue such qualifications in effect so long as required for the
distribution; provided that the Company will not be required to file a general
consent to service of process or qualify to do business or subject itself to
taxation with respect to doing business in any jurisdiction where it is not so
qualified.
(g) For a period of 90 days after the date of the public offering of the
Offered Securities, the Company will not offer, sell, contract to sell, pledge
or otherwise dispose of, directly or indirectly, or file with the Commission a
registration statement under the Act (except for a registration statement on
form S-8 relating to increasing the shares available on the Company's existing
stock option plans) relating to, any additional shares of its Securities or
- 12 -
securities convertible into or exchangeable or exercisable for any shares of its
Securities, or publicly disclose the intention to make any such offer, sale,
pledge, disposition or filing, without the prior written consent of CSFBC,
except issuances of Securities pursuant to the exercise of warrants or options,
in each case outstanding on the date hereof, grants of employee stock options
pursuant to the terms of a plan in effect on the date hereof, or issuances of
Securities pursuant to the exercise of such options.
(h) The Company will pay all expenses incident to the performance of the
obligations of the Company and the Selling Stockholders, under this Agreement,
for any filing fees and other expenses (including fees and disbursements of
counsel for the Company) in connection with 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 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 transfer
taxes on the sale by the Selling Stockholders of the Offered Securities to the
Underwriters, for expenses incurred in distributing preliminary prospectuses and
the Prospectus (including any amendments and supplements thereto) to the
Underwriters and the reasonable fees and expenses of one counsel to the Selling
Stockholders.
(i) Each Selling Stockholder agrees, for a period of 90 days after the date
of the public offering of the Offered Securities, not to offer, sell, contract
to sell, pledge or otherwise dispose of, directly or indirectly, any additional
shares of the Securities of the Company or securities convertible into or
exchangeable or exercisable for any shares of Securities, enter into a
transaction that would have the same effect, or enter into any swap, hedge or
other arrangement that transfers, in whole or in part, any of the economic
consequences of ownership of the Securities, whether any such aforementioned
transaction is to be settled by delivery of the Securities or such other
securities, in cash or otherwise, or publicly disclose the intention to make any
such offer, sale, pledge or disposition, or enter into any such transaction,
swap, hedge or other arrangement, without, in each case, the prior written
consent of CSFBC. Notwithstanding the foregoing, a Selling Stockholder may
transfer shares of the Securities to a charitable organization, subsidiary, its
stockholders, affiliates, family member or trust provided that the transferee
agrees to be subject to this provision. Securities acquired by a Selling
Stockholder in the open market will not be subject to this provision.
6. Conditions of the Obligations of the Underwriters. The obligations of
the several Underwriters to purchase and pay for the Firm Securities 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 Stockholders 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
Stockholders of their obligations hereunder and to the following additional
conditions precedent:
- 13 -
(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 KPMG 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 examined by them and
included in the Registration Statement 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, 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 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 financial statements for them to be in
conformity with generally accepted accounting principles;
(B) 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
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 Prospectus; or
(C) for the period from the closing date of the latest income
statement included in 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 Prospectus, in consolidated
net sales or net operating income in the
- 14 -
total or per share amounts of consolidated income before extraordinary
items or net income;
except in all cases set forth in clauses (B) and (C) above for changes,
increases or decreases that the Prospectus discloses have occurred or may
occur or that are described in such letter; and
(iv) they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information contained
in the Registration Statements (in each case to the extent that such dollar
amounts, percentages 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 and other financial information to be in agreement
with such results, except as otherwise specified in such letter.
For purposes of this subsection, (i) if the Effective Time of the Initial
Registration Statements 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 Statements 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 included in information incorporated by
reference into the Prospectus shall be deemed 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 Stockholder, the Company or the
Representatives, shall be contemplated by the Commission.
- 15 -
(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 and its Subsidiaries taken as a whole,
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 change in U.S. or international
financial, political or economic conditions or currency exchange rates or
exchange controls as would, in the judgment of a majority in interest of the
Underwriters, including the Representatives, be likely to prejudice materially
the success of the proposed issue, sale or distribution of the Offered
Securities whether in the primary market or in respect of dealings in the
secondary market; (iv) any material suspension or material 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; (v)
any banking moratorium declared by U.S. Federal or New York authorities; (vi)
any major disruption of settlements of securities or clearance services in the
United States; or (vii) any attack on or outbreak or escalation of hostilities
or act of terrorism involving the United States, any declaration of war by
Congress or any other 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 attack, outbreak, escalation, act,
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 XxXxxxxxx, Will & Xxxxx, counsel for the Company, to the effect that:
(i) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own its properties and conduct its
business as described in the Prospectus; and the Company is duly qualified
to do business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the conduct of
its business requires such qualification;
(ii) Each Subsidiary has been duly incorporated and is an existing
corporation in good standing under the laws of the jurisdiction of its
incorporation, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus; and
each Subsidiary is duly qualified to do business as a foreign corporation
in good standing in all other jurisdictions in which its ownership or lease
of property or the conduct of its business requires such qualification; all
of the issued and
- 16 -
outstanding capital stock of each Subsidiary has been duly authorized and
validly issued and is fully paid and nonassessable; and the capital stock
of each Subsidiary, directly or through subsidiaries, is owned free from
liens, encumbrances and defects.
(iii) The Offered Securities delivered on such Closing Date and all
other outstanding shares of the Common Stock of the Company have been duly
authorized and validly issued, are fully paid and nonassessable and conform
to the description thereof contained in the Prospectus; and the
stockholders of the Company have no preemptive rights with respect to the
Securities;
(iv) There are no contracts, agreements or understandings known to
such counsel between the Company and any person granting such person the
right to require the Company to file a registration statement under the Act
with respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the Offered
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;
(v) The Company is not and, after giving effect to the offering and
sale of the Offered Securities and the application of the proceeds thereof
as described in the Prospectus, will not be an "investment company" as
defined in the Investment Company Act of 1940.
(vi) No consent, approval, authorization or order of, or filing with,
any governmental agency or body or any court is required to be obtained or
made by the Company or any Selling Stockholder for the consummation of the
transactions contemplated by this Agreement or the Custody Agreement 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;
(vii) The execution, delivery and performance of this Agreement or the
Power of Attorney and related Custody Agreement and the consummation of the
transactions herein or therein contemplated will not result in a breach or
violation of any of the terms and provisions of, or constitute a default
under, any statute, any rule, regulation or order of any governmental
agency or body or any court having jurisdiction over the Company or any
Subsidiary or any of their properties, or any agreement or instrument to
which the Company or any Subsidiary is a party or by which the Company or
any Subsidiary is bound or to which any of the properties of the Company or
any Subsidiary is subject, or the charter or by-laws of the Company or any
Subsidiary;
(viii) 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
- 17 -
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 of the 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 each
Registration Statement and the Prospectus, and each amendment or supplement
thereto, as of their respective effective or issue dates, complied as to
form in all material respects with the requirements of the Act and the
Rules and Regulations; such counsel have 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 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 not misleading; or that
the Prospectus or any amendment or supplement thereto, as of its issue date
or as of such Closing Date, contained any untrue statement of a material
fact or omitted 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; the descriptions in the Registration Statements and
Prospectus of statutes, legal and governmental proceedings and contracts
and other documents are accurate and fairly present the information
required to be shown; and such counsel do not know of any legal or
governmental proceedings required to be described in a Registration
Statement or the Prospectus which are not described as required or of any
contracts or documents of a character required to be described in a
Registration Statement or the Prospectus or to be filed as exhibits to a
Registration Statement which are not described and filed as required; it
being understood that such counsel need express no opinion as to the
financial statements or other financial data contained in the Registration
Statements or the Prospectus; and
(ix) This Agreement has been duly authorized, executed and delivered
by the Company.
(e) The Representatives shall have received the opinion contemplated in the
Power of Attorney executed and delivered by each Selling Stockholder and an
opinion, dated such Closing Date, of XxXxxxxxx, Will & Xxxxx, counsel for the
Selling Stockholders, except Keystone, Inc., and of ,
counsel for Keystone, Inc. to the effect that:
(i) Each Selling Stockholder had valid and unencumbered title to the
Offered Securities delivered by such Selling Stockholder on such Closing
Date and had full right, power and authority to sell, assign, transfer and
deliver the Offered Securities delivered by such Selling Stockholder on
such Closing Date hereunder; and the several Underwriters have acquired
valid and unencumbered title to the Offered Securities purchased by them
from the Selling Stockholder on such Closing Date hereunder;
- 18 -
(ii) Selling Stockholder for the consummation of the transactions
contemplated by the Custody Agreement or this Agreement in connection with
the sale of the Offered Securities sold by the Selling Stockholders, except
such as have been obtained and made under the Act and such as may be
required under state securities laws;
(iii) The execution, delivery and performance of the Power of Attorney
and related Custody Agreement and this Agreement and the consummation of
the transactions therein and herein contemplated will not result in a
breach or violation of any of the terms and provisions of, or constitute a
default under, any statute, any rule, regulation or order of any
governmental agency or body or any court having jurisdiction over any
Selling Stockholder or any of their properties or any agreement or
instrument to which any Selling Stockholder is a party or by which any
Selling Stockholder is bound or to which any of the properties of any
Selling Stockholder is subject, or the charter or by-laws of any Selling
Stockholder which is a corporation; and
(iv) The Power of Attorney and related Custody Agreement with respect
to each Selling Stockholder has been duly authorized, executed and
delivered by such Selling Stockholder and constitute valid and legally
binding obligations of each such Selling Stockholder enforceable in
accordance with their terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles; and
(v) This Agreement has been duly authorized, executed and delivered by
each Selling Stockholder.
(f) The Representatives shall have received from Xxxxxx Xxxxxx Xxxxx
Xxxxxxxx, counsel for the Underwriters, such opinion or opinions, dated such
Closing Date, with respect to the incorporation of the Company, the validity of
the Offered Securities delivered on such Closing Date, the Registration
Statements, the Prospectus and other related matters as the Representatives may
require, and the Selling Stockholders and the Company shall have furnished to
such counsel such documents as they request for the purpose of enabling them to
pass upon such matters.
(g) The Representatives shall have received a certificate, dated such
Closing Date, of the President or any Vice President and a principal financial
or accounting officer of the Company in which such officers shall state, to
their knowledge after reasonable investigation, that: the representations and
warranties of the Company in this Agreement are true and correct; 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; no stop order
suspending the effectiveness of any Registration Statement has been issued and
no proceedings for that purpose have been instituted or are contemplated by the
Commission; the Additional Registration Statement (if any) satisfying the
requirements of subparagraphs (1) and (3) of Rule 462(b) was
- 19 -
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; and, subsequent to
the respective dates of the most recent financial statements in the Prospectus,
there (g) 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 except as set forth in or contemplated by the
Prospectus or as described in such certificate.
(h) The Representatives shall have received a letter, dated such Closing
Date, of KPMG LLP that 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 days prior to such Closing Date for the purposes of this
subsection.
(i) On or prior to the date of this Agreement, the Representatives shall
have received lockup letters from each of the executive officers and directors
of the Company.
(j) The Custodian will deliver to CSFBC on the Closing Date a letter
stating that it will deliver to each Selling Stockholder a United States
Treasury Department Form 1099 (or other applicable form or statement specified
by the United States Treasury Department regulations in lieu thereof) on or
before January 31 of the year following the date of this Agreement.
The Company and the Selling Stockholders 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.
7. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless each Underwriter, its
directors and officers and each person, if any who controls such Underwriter
within the meaning of Section 15 of the Act, against any losses, claims, damages
or liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon 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 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
- 20 -
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 (a) Underwriter consists of the
information described as such in subsection (c) below; and provided, further,
however, that with respect to any untrue statement or alleged untrue statement
in, or omission or alleged omission from, any preliminary prospectus or
Prospectus, the indemnity agreement contained in this Section 7(a) 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 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 (exclusive of material incorporated by
reference) if the Company had previously furnished copies thereof to such
Underwriters.
(b) The Selling Stockholders, severally and not jointly, will indemnify and
hold harmless each Underwriter, its directors and officers and each person, if
any who controls such Underwriter within the meaning of Section 15 of the Act,
against any losses, claims, damages or liabilities, 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 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 Stockholders will only be subject
to such liability to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission is based upon information provided by
such Selling Stockholder or contained in a representation or warranty given by
such Selling Stockholder in this Agreement or the Power of Attorney and Custody
Agreement and provided further, that the liability under this subsection of each
Selling Stockholder shall be limited to an amount equal to the aggregate gross
proceeds after underwriting commissions and discounts, but before expenses to
such Selling Stockholder from the sale of Securities sold by such Selling
Stockholder hereunder.
(c) Each Underwriter will severally and not jointly indemnify and hold
harmless the Company, its directors and officers and each person, if any who
controls the Company within the meaning of Section 15 of the Act, and each
Selling Stockholder, its directors and officers and each person, if any, who
controls such Selling Stockholder within the meaning of Section 15 of the Act,
against any losses, claims, damages or liabilities to which the Company or such
Selling Stockholder may become subject, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in any Registration
- 21 -
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 to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such 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 Stockholder
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 such information furnished by any Underwriter consists of
the following information in the Prospectus appearing under the caption
"Underwriting" furnished on behalf of each Underwriter: the concession and
reallowance figures appearing in the fourth paragraph and the information
relating to stabilizing, over-allotment and syndicate covering transactions and
penalty bids appearing in the twelfth paragraph (including all subparagraphs).
(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,
otherwise than under subsection (a), (b) or (c) above. 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 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, effect
any settlement, compromise or consent to the entry of any judgment 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, compromise or consent (i) includes an
unconditional release of such indemnified party from all liability on any claims
that are the subject matter of such action and (ii) does not include a statement
as to, or an admission of, fault, culpability or a failure to act by or on
behalf of an indemnified party.
(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 severally, and not jointly,
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 each Selling Stockholder on the one hand
and the
- 22 -
Underwriters on the other from the offering of the 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
each Selling Stockholder on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Company and each Selling
Stockholder 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 each Selling Stockholder 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, a Selling Stockholder 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 which 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 Securities
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which 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 Stockholders under this
Section shall be in addition to any liability that the Company and the Selling
Stockholders 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 a
Registration Statement and to each person, if any, who controls the Company
within the meaning of the Act.
8. Default of Underwriters. If any Underwriter or Underwriters default in
their obligations to purchase Offered 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 Stockholders 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
- 23 -
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 Stockholders
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
Stockholders, 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 Stockholders, 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
Stockholder, 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 shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 5 and the respective
obligations of the Company, the Selling Stockholders, 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), (v) (vi) or
(vii) of Section 6(c), the Company will reimburse the Underwriters for all
out-of-pocket expenses (including fees and disbursements of counsel) reasonably
incurred by them in connection with the offering of the Offered Securities.
10. Notices. All communications hereunder will be in writing and, if sent
to the Underwriters, will be mailed, delivered or faxed (with a copy sent by
overnight mail) to the Representatives, c/o Credit Suisse First Boston
Corporation, Eleven Xxxxxxx Xxxxxx, Xxx Xxxx, XX 00000-0000, Attention:
Transactions Advisory Group, or, if sent to the Company, will be mailed,
delivered or faxed (with a copy sent by overnight mail) to it at 000 Xxxxx Xxxx
Xxxx, Xxx Xxxxx, XX 00000, Attention: General Counsel and Chief Financial
Officer, or, if sent to the Selling Stockholders or any of them, will be mailed,
delivered or faxed and confirmed to the address set forth on Schedule A hereto;
provided, however, that any notice to an Underwriter pursuant to Section 8 will
be mailed, delivered or faxed to such Underwriter.
- 24 -
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.
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 will be binding
upon all the Underwriters.
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.
15. The Company hereby submits 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.
- 25 -
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 Stockholders, the
Company and the several Underwriters in accordance with its terms.
Very truly yours,
-----------------------------------------------
THE SELLING STOCKHOLDERS NAMED IN SCHEDULE A
HERETO SEVERALLY
Name:
------------------------------------------
Attorney-in-Fact
PROQUEST COMPANY
By:
--------------------------------------------
Name:
------------------------------------------
Title:
-----------------------------------------
The foregoing Underwriting Agreement is hereby confirmed and accepted as of the
date first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
BANC OF AMERICA SECURITIES LLC
BEAR, XXXXXXX & CO. INC.
U.S. BANCORP XXXXX XXXXXXX INC.
XXXXXXXXX & COMPANY, INC.
Acting on behalf of themselves and as the Representatives of the
several Underwriters.
By: Credit Suisse First Boston Corporation
By:
--------------------------------------------
Name:
------------------------------------------------
TITLE:
-----------------------------------------------
- 26 -
SCHEDULE A
Number of Number of
Firm Optional
Securities Securities
Selling Stockholder to be Sold to be Sold
------------------- ---------- ----------
Keystone, Inc. 1,750,000 --
000 Xxxx Xxxxxx
Xxxxx 0000
Xxxx Xxxxx, Xxxxx 00000
Attn: Xxxxx X. Xxxx
Xxxxx Xxxxxxxxx 280,000 59,478
Xxxxx X. Xxxxxx 48,000 2,522
Xxxx Xxxxxxxx 5,000 --
Xxxxx Xxxxx-Xxxxxxxx 8,000 435
Xxxxxx X. Xxxxxxxx 9,000 667
--------- ------
Total......................................... 2,100,000 63,102
========= ======
A-1
SCHEDULE B
Number of Number of
Firm Optional
Securities Securities
Underwriter to be Purchased to be Purchased
----------- --------------- ---------------
Credit Suisse First Boston Corporation
Banc of America Securities LLC
Bear, Xxxxxxx & Co. Inc.
U.S. Bancorp Xxxxx Xxxxxxx Inc.
Xxxxxxxxx & Company, Inc.
--------- -------
Total 5,100,000 765,000
========= =======
B-1
SCHEDULE C
SUBSIDIARIES
C-1
