EXHIBIT 1.1
5,000,000 SHARES(1)
XXXXX XXXXXXXXXXX COMPANY
COMMON STOCK
PURCHASE AGREEMENT
_____________________, 1997
XXXXX XXXXXXX INC.
XXXXXX, READ & CO. INC.
c/o Xxxxx Xxxxxxx Inc.
Xxxxx Xxxxxxx Tower
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Ladies and Gentlemen:
Xxxxx Xxxxxxxxxxx Company, a Delaware corporation (the "Company"), and the
stockholders of the Company listed in Schedule I hereto (the "Selling
Stockholders") severally propose to sell to the Underwriters named in
Schedule II hereto (the "Underwriters") an aggregate of 5,000,000 shares (the
"Firm Shares") of Common Stock, $.01 par value per share (the "Common Stock"),
of the Company. The Firm Shares consist of 2,006,565 authorized but unissued
shares of Common Stock to be issued and sold by the Company and 2,993,435
outstanding shares of Common Stock to be sold by the Selling Stockholders. The
Company has also granted to the Underwriters an option to purchase up to 750,000
additional shares of Common Stock on the terms and for the purposes set forth in
Section 3 hereof (the "Option Shares"). The Firm Shares and any Option Shares
purchased pursuant to this Purchase Agreement are herein collectively called the
"Securities."
The Company and the Selling Stockholders hereby confirm their agreement
with respect to the sale of the Securities to the Underwriters.
1. REGISTRATION STATEMENT AND PROSPECTUS. A registration statement on
Form S-2 (File No. 333-29581) with respect to the Securities, including a
preliminary form of prospectus, has been prepared by the Company in conformity
with the requirements of the Securities Act of 1933, as amended (the "Act"), and
the rules and regulations (the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") thereunder and has been filed with the
Commission; one or more amendments to such registration statement have also been
so prepared and have been, or will be, so filed; and, if the Company has elected
to rely upon Rule 462(b) of the Rules and Regulations to increase the size of
the offering registered under the Act, the Company will prepare and file with
the Commission a registration statement with respect to such increase pursuant
to Rule 462(b). Copies of such registration statement(s) and amendments and
each related preliminary prospectus have been delivered to you.
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(1) Plus an option to purchase up to 750,000 additional shares to cover
over-allotments.
If the Company has elected not to rely upon Rule 430A of the Rules and
Regulations, the Company has prepared and will promptly file an amendment to the
registration statement and an amended prospectus (including a term sheet, if
any, meeting the requirements of Rule 434 of the Rules and Regulations). If the
Company has elected to rely upon Rule 430A of the Rules and Regulations, it will
prepare and file a prospectus (or a term sheet meeting the requirements of Rule
434) pursuant to Rule 424(b) that discloses the information previously omitted
from the prospectus in reliance upon Rule 430A. Such registration statement as
amended at the time it is or was declared effective by the Commission, and, in
the event of any amendment thereto after the effective date and prior to the
First Closing Date (as hereinafter defined), such registration statement as so
amended (but only from and after the effectiveness of such amendment), including
a registration statement (if any) filed pursuant to Rule 462(b) of the Rules and
Regulations increasing the size of the offering registered under the Act, all
documents incorporated or deemed to be incorporated by reference therein, and
information (if any) deemed to be part of the registration statement at the time
of effectiveness pursuant to Rules 430A(b) and 434(d) of the Rules and
Regulations, is hereinafter called the "Registration Statement." The prospectus
included in the Registration Statement at the time it is or was declared
effective by the Commission is hereinafter called the "Prospectus," except that
if any prospectus (including any term sheet meeting the requirements of Rule 434
of the Rules and Regulations provided by the Company for use with a prospectus
subject to completion within the meaning of Rule 434 in order to meet the
requirements of Section 10(a) of the Rules and Regulations) filed by the Company
with the Commission pursuant to Rule 424(b) (and Rule 434, if applicable) of the
Rules and Regulations or any other such prospectus provided to the Underwriters
by the Company for use in connection with the offering of the Securities
(whether or not required to be filed by the Company with the Commission pursuant
to Rule 424(b) of the Rules and Regulations) differs from the prospectus on file
at the time the Registration Statement is or was declared effective by the
Commission, the term "Prospectus" shall refer to such differing prospectus
(including any term sheet within the meaning of Rule 434 of the Rules and
Regulations) from and after the time such prospectus is filed with the
Commission or transmitted to the Commission for filing pursuant to such
Rule 424(b) (and Rule 434, if applicable) or from and after the time it is first
provided to the Underwriters by the Company for such use. The term "Preliminary
Prospectus" as used herein means any preliminary prospectus included in the
Registration Statement prior to the time it becomes or became effective under
the Act and any prospectus subject to completion as described in Rule 430A or
434 of the Rules and Regulations. All references in this Agreement to the
Registration Statement, a Preliminary Prospectus or the Prospectus, or any
amendments or supplements to any of the foregoing, shall include any copy
thereof filed with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval System. All references in this Agreement to financial
statements and schedules and other information which is "contained," "included"
or "stated" in the Registration Statement or the Prospectus (and all other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is or is deemed
to be incorporated by reference in the Registration Statement or the Prospectus,
as the case may be; and all references in this Agreement to amendments or
supplements to the Registration Statement or the Prospectus shall be deemed to
mean and include the filing of any document under the Securities Exchange Act of
1934 (the "Exchange Act") which is or is deemed to be incorporated by reference
in the Registration Statement or the Prospectus, as the case may be.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SELLING
STOCKHOLDERS.
(a) The Company represents and warrants to, and agrees with, the
Underwriters as follows:
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(i) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission and each
Preliminary Prospectus distributed by the Underwriters to prospective
investors, at the time of filing thereof, did not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading; except
that the foregoing shall not apply to statements in or omissions from any
such Preliminary Prospectus in reliance upon, and in conformity with,
written information furnished to the Company by you, or by any Underwriter
through you, specifically for use in the preparation thereof.
(ii) The Company meets the requirements for use of Form S-2.
As of the time the Registration Statement (or any post-effective amendment
thereto, including a registration statement (if any) filed pursuant to
Rule 462(b) of the Rules and Regulations increasing the size of the
offering registered under the Act) is or was declared effective by the
Commission, upon the filing or first delivery to the Underwriters of the
Prospectus (or any supplement to the Prospectus (including any term sheet
meeting the requirements of Rule 434 of the Rules and Regulations)) and at
the First Closing Date and Second Closing Date (as hereinafter defined),
(A) the Registration Statement and Prospectus (in each case, as so amended
and/or supplemented) conformed or will conform in all material respects to
the requirements of the Act and the Rules and Regulations, (B) the
Registration Statement (as so amended) did not or will not include an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading, and (C) the Prospectus (as so supplemented) did not or will
not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they are or were
made, not misleading; except that the foregoing shall not apply to
statements in or omissions from any such document in reliance upon, and in
conformity with, written information furnished to the Company by any
Underwriter specifically for use in the preparation thereof. If the
Registration Statement has been declared effective by the Commission, no
stop order suspending the effectiveness of the Registration Statement has
been issued, and no proceeding for that purpose has been initiated or, to
the Company's knowledge, threatened by the Commission.
(iii) The financial statements of the Company, Xxxxxxx Mining
Services Limited ("Xxxxxxx") and Glindemann & Kitching Pty Ltd. ("G&K"),
together with the notes thereto, set forth in the Registration Statement
and Prospectus comply in all material respects with the requirements of the
Act and fairly present the financial condition of the Company, Xxxxxxx and
G&K, respectively, as of the dates indicated and the results of operations
and changes in cash flows for the periods therein specified in conformity
with generally accepted accounting principles consistently applied
throughout the periods involved (except as otherwise stated therein); the
supporting schedules included in the Registration Statement present fairly
the information required to be stated therein; and the historical financial
information set forth in the Prospectus under the captions "Summary
Historical and Pro Forma Consolidated Financial Data", "The Xxxxxxx
Acquisition" and "Selected Consolidated Financial Data" are fairly stated
in all material respects in relation to the financial statements from which
they have been derived. The pro forma financial data included in the
Registration Statement and the Prospectus present fairly the information
shown therein, comply in all material respects with the requirements of the
Act and the Rules and Regulations with respect to pro forma financial
statements, have been properly compiled on the pro forma basis described
therein and the assumptions used in the preparation thereof are reasonable
and the adjustments used therein are appropriate to give effect to the
transactions or circumstances referred to therein. No other financial
statements or schedules are required to be included in the
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Registration Statement or Prospectus. Deloitte & Touche LLP and KPMG,
which have expressed their respective opinions with respect to the
financial statements and schedules of the Company and of Xxxxxxx and G&K,
respectively, filed as a part of the Registration Statement, are
independent public accountants as required by the Act and the Rules and
Regulations.
(iv) Each of the Company and its subsidiaries (which shall be
deemed to include all entities in which the Company directly or indirectly
owns voting securities aggregating 50% or more of the outstanding voting
securities of such entities) listed on Schedule III hereto (a "Scheduled
Subsidiary") and, to the Company's knowledge, its affiliates (which shall
be deemed to include any entity in which the Company owns directly or
indirectly voting securities aggregating 50% or less, but greater than 10%,
of the outstanding voting securities of such entity) listed on Schedule IV
hereto (a "Scheduled Foreign Affiliate"), has been duly organized and is
validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation. Each of the Company and its Scheduled
Subsidiaries and, to the Company's knowledge, its Scheduled Foreign
Affiliates, has full corporate power and authority to own its properties
and conduct its business as currently being carried on and as described in
the Registration Statement and Prospectus, and is duly qualified to do
business as a foreign corporation in good standing in each jurisdiction in
which it owns or leases real property or in which the conduct of its
business makes such qualification necessary and in which the failure to so
qualify would result in a Material Adverse Change (as defined below).
(v) Except as contemplated in the Prospectus, subsequent to
the respective dates as of which information is given in the Registration
Statement and the Prospectus, neither the Company nor any of its Scheduled
Subsidiaries, nor, to the Company's knowledge, any of its Scheduled Foreign
Affiliates, has incurred any material liabilities or obligations, direct or
contingent, or entered into any material transactions not in the ordinary
course of business, or, in the case of the Company, declared or paid any
dividends or made any distribution of any kind with respect to its capital
stock; and there has not been any change in the capital stock (other than a
change in the number of outstanding shares of Common Stock due to the
issuance of shares upon the exercise of outstanding options or warrants),
or any material change in the consolidated short-term or long-term debt of
the Company and its subsidiaries, or any issuance of options, warrants,
convertible securities or other rights to purchase the capital stock of the
Company or any of its Scheduled Subsidiaries, or, to the Company's
knowledge, any of its Scheduled Foreign Affiliates, or any material adverse
change or any development involving a prospective material adverse change
(whether or not arising in the ordinary course of business) in the
financial condition, business, management, property, net worth or results
of operations of the Company and its subsidiaries and, to the Company's
knowledge, its affiliates, taken as a whole (any such change is called a
"Material Adverse Change").
(vi) Except as set forth in the Prospectus, there is not
pending any action, suit or proceeding to which the Company or any of its
subsidiaries or, to the Company's knowledge, any of its Scheduled Foreign
Affiliates is a party before or by any court or governmental agency,
authority or body, or any arbitrator, which might result in any Material
Adverse Change and there is not, to the Company's knowledge, threatened or
contemplated any action, suit or proceeding to which the Company or any of
its subsidiaries or Scheduled Foreign Affiliates is a party before or by
any court or governmental agency, authority or body, or any arbitrator,
which might result in any Material Adverse Change.
(vii) There are no contracts or documents of the Company or any
of its
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subsidiaries or, to the Company's knowledge, any of its Scheduled Foreign
Affiliates, that are required to be filed as exhibits to the Registration
Statement by the Act or by the Rules and Regulations that have not been so
filed.
(viii) This Agreement has been duly authorized, executed and
delivered by the Company, and constitutes a valid, legal and binding
obligation of the Company, enforceable in accordance with its terms, except
as rights to indemnity hereunder may be limited by federal or state
securities laws and except as such enforceability may be limited by
bankruptcy, insolvency, reorganization or similar laws affecting the rights
of creditors generally and subject to general principles of equity. The
execution, delivery and performance of this Agreement and the consummation
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, any statute, any agreement or instrument to which the Company is a
party or by which it is bound or to which any of its property is subject,
the Company's charter or by-laws, or any order, rule, regulation or decree
of any court or governmental agency or body having jurisdiction over the
Company or any of its properties; no consent, approval, authorization or
order of, or filing with, any court or governmental agency or body is
required for the execution, delivery and performance of this Agreement or
for the consummation of the transactions contemplated hereby, including the
issuance or sale of the Securities by the Company, except such as may be
required under the Act or state securities or blue sky laws; and the
Company has full power and authority to enter into this Agreement and to
authorize, issue and sell the Securities as contemplated by this Agreement.
(ix) All of the issued and outstanding shares of capital stock
of the Company, including the outstanding shares of Common Stock, are duly
authorized and validly issued, fully paid and nonassessable, have been
issued in compliance with all federal and state securities laws, were not
issued in violation of or subject to any preemptive rights or other rights
to subscribe for or purchase securities, and the holders thereof are not
subject to personal liability by reason of being such holders; the
Securities which may be sold hereunder by the Company have been duly
authorized and, when issued, delivered and paid for in accordance with the
terms hereof, will have been validly issued and will be fully paid and
nonassessable, and the holders thereof will not be subject to personal
liability by reason of being such holders; and the capital stock of the
Company, including the Common Stock, conforms to the description thereof in
the Registration Statement and Prospectus. Except as otherwise stated in
the Registration Statement and Prospectus, there are no preemptive rights
or other rights to subscribe for or to purchase, or any restriction upon
the voting or (except as set forth in stock and stock option agreements
with employees and former employees) transfer of, any shares of Common
Stock pursuant to the Company's charter, by-laws or any agreement or other
instrument to which the Company is a party or by which the Company is
bound, and neither the filing of the Registration Statement nor the
offering or sale of the Securities as contemplated by this Agreement gives
rise to any rights for or relating to the registration of any shares of
Common Stock or other securities of the Company which have not been
satisfied or waived. All of the issued and outstanding shares of capital
stock of each of the Company's Scheduled Subsidiaries and, to the Company's
knowledge, each of its Scheduled Foreign Affiliates, have been duly and
validly authorized and issued and are fully paid and nonassessable, and,
except as otherwise described in the Registration Statement and Prospectus,
the Company owns of record and beneficially, free and clear of any material
security interests, claims, liens, proxies, equities or other encumbrances,
all of the issued and outstanding shares of such stock. Except as
described in the Registration Statement and the Prospectus, there are no
options, warrants, agreements, contracts or other rights in existence to
purchase or acquire from the Company or any Scheduled Subsidiary of the
Company or, to the Company's knowledge, any of its Scheduled Foreign
Affiliates, any
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shares of the capital stock of the Company or any Scheduled Subsidiary or
Scheduled Foreign Affiliate of the Company. The Company has an authorized
and outstanding capitalization as set forth in the Registration Statement
and the Prospectus.
(x) The Company and each of its Scheduled Subsidiaries and, to
the Company's knowledge, each of its Scheduled Foreign Affiliates, holds,
and is operating in compliance in all material respects with, all material
franchises, grants, authorizations, licenses, permits, easements, consents,
certificates and orders of any governmental or self-regulatory body
required for the conduct of its business and all such franchises, grants,
authorizations, licenses, permits, easements, consents, certifications and
orders are valid and in full force and effect; and the Company and each of
its Scheduled Subsidiaries and, to the Company's knowledge, each of its
Scheduled Foreign Affiliates, is in compliance in all material respects
with all applicable material federal, state, local and foreign laws,
regulations, orders and decrees.
(xi) The Company and its Scheduled Subsidiaries and, to the
Company's knowledge, its Scheduled Foreign Affiliates, have good and
marketable title to all property described in the Registration Statement
and Prospectus as being owned by them, in each case free and clear of all
material liens, claims, security interests or other encumbrances except
such as are described in the Registration Statement and the Prospectus; the
property described in the Registration Statement as held under lease by the
Company and its subsidiaries and its foreign affiliates, is held by the
Company and its subsidiaries and, to the Company's knowledge, its foreign
affiliates under valid, subsisting and enforceable leases with only such
exceptions with respect to any particular lease as do not interfere in any
material respect with the conduct of the business of the Company and its
subsidiaries and foreign affiliates, taken as a whole; the Company and each
of its Scheduled Subsidiaries and, to the Company's knowledge, its
Scheduled Foreign Affiliates, owns or possesses all patents, patent
applications, trademarks, service marks, tradenames, trademark
registrations, service xxxx registrations, copyrights, licenses,
inventions, trade secrets and rights necessary for the conduct of the
business of the Company and its Scheduled Subsidiaries and, to the
Company's knowledge, its Scheduled Foreign Affiliates, as currently carried
on and as described in the Registration Statement and Prospectus; except as
stated in the Registration Statement and Prospectus, to the knowledge of
the Company, no name which the Company or any of its Scheduled Subsidiaries
or Scheduled Foreign Affiliates uses and no other aspect of the business of
the Company or any of its Scheduled Subsidiaries or Scheduled Foreign
Affiliates, involves or gives rise to any infringement of, or license or
similar fees for, any patents, patent applications, trademarks, service
marks, tradenames, trademark registrations, service xxxx registrations,
copyrights, licenses, inventions, trade secrets or other similar rights of
others that would result in a Material Adverse Change and neither the
Company nor any of its subsidiaries, nor, to the Company's knowledge, any
of its Scheduled Foreign Affiliates, has received any notice alleging any
such infringement or fee.
(xii) Neither the Company nor any of its Scheduled Subsidiaries,
nor, to the Company's knowledge, any of its Scheduled Foreign Affiliates,
is in violation of its respective charter or by-laws or in breach of or
otherwise in default in the performance of any material obligation,
agreement or condition contained in any bond, debenture, note, indenture,
loan agreement or any other material contract, lease or other instrument to
which it is subject or by which any of them may be bound, or to which any
of the material property or assets of the Company or any of its Scheduled
Subsidiaries or Scheduled Foreign Affiliates is subject.
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(xiii) The Company and its subsidiaries, and, to the Company's
knowledge, its Scheduled Foreign Affiliates, have filed all federal, state,
local and foreign income and franchise tax returns required to be filed and
are not in default in the payment of taxes of any material amount which
were payable pursuant to said returns or any assessments with respect
thereto, other than any which the Company or any of its subsidiaries or
Scheduled Foreign Affiliates is contesting in good faith.
(xiv) The Company has not distributed and will not distribute
any prospectus or other offering material in connection with the offering
and sale of the Securities other than any Preliminary Prospectus or the
Prospectus or other materials permitted by the Act to be distributed by the
Company.
(xv) The Common Stock (including the Securities) is registered
pursuant to Section 12(g) of the Exchange Act and is listed on the Nasdaq
National Market, and the Company has taken no action designed to, or likely
to have the effect of, terminating the registration of the Common Stock
under the Exchange Act or delisting the Common Stock from the Nasdaq
National Market, nor has the Company received any notification that the
Commission or the National Association of Securities Dealers, Inc. is
contemplating terminating such registration or listing. The Company has
filed an application to list the Securities on the NASDAQ National Market
System and has paid the required fee in connection therewith.
(xvi) The entities listed on Schedule V hereto include all the
Company's subsidiaries and affiliates. Except for such entities, the
Company and its subsidiaries, and, to its knowledge its affiliates, own no
capital stock or other equity or ownership or proprietary interest,
directly or indirectly, in any corporation, partnership, association, trust
or other entity. No subsidiary or affiliate of the Company not named on
Schedule III or Schedule IV hereto is a significant subsidiary (as defined
in Rule 405 under the Act).
(xvii) The Company maintains a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions
are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(xviii)Other than as contemplated by this Agreement, the Company
has not incurred any liability for any finder's or broker's fee or agent's
commission in connection with the execution and delivery of this Agreement
or the consummation of the transactions contemplated hereby.
(xix) Neither the Company, its Scheduled Subsidiaries nor, to
the Company's knowledge, any of its Scheduled Foreign Affiliates is
presently doing business with the government of Cuba or with any person or
affiliate located in Cuba.
(xx) There are no business relationships or related-party
transactions involving the Company or any Scheduled Subsidiary or, to the
Company's knowledge, any Scheduled
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Foreign Affiliate, or any other person required to be described in the
Prospectus which have not been described as required.
(xxi) The documents incorporated or deemed to be incorporated by
reference in the Prospectus, at the time they were or hereafter are filed
with the Commission, complied and will comply in all material respects with
the requirements of the Exchange Act, and, when read together with the
other information in the Prospectus, at the time the Registration Statement
and any amendments thereto become effective and at the First Closing Date
and the Second Closing Date, as the case may be, will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the facts required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(xxii) Neither the Company nor any of its Scheduled Subsidiaries
nor, to the Company's knowledge, any of its Scheduled Foreign Affiliates
nor any employee or agent of the Company or any Scheduled Subsidiary or, to
the Company's knowledge, any Scheduled Foreign Affiliate, has made any
contribution or other payment to any official of, or candidate for, any
federal, state or foreign office in violation of any law.
(xxiii)Except as set forth in the Prospectus or except as would
not, individually or in the aggregate, result in a Material Adverse Change
(i) neither the Company nor any of its Scheduled Subsidiaries nor, to the
Company's knowledge, any of its Scheduled Foreign Affiliates, is in
violation of any federal, state, local or foreign law or regulation
relating to pollution or protection of human health or the environment
(including, without limitation, ambient air, surface water, groundwater,
land surface or subsurface strata) or wildlife, including without
limitation, laws and regulations relating to emissions, discharges,
releases or threatened releases of chemicals, pollutants, contaminants,
wastes, toxic substances, hazardous substances, petroleum and petroleum
products (collectively, "Materials of Environmental Concern"), or otherwise
relating to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of Materials of Environmental
Concern (collectively, Environmental Laws"), which violation includes, but
is not limited to, noncompliance with any permits or other governmental
authorizations required for the operation of the business of the Company or
its Scheduled Subsidiaries or, to the Company's knowledge, its Scheduled
Foreign Affiliates, under applicable Environmental Laws, or noncompliance
with the terms and conditions thereof, nor has the Company or any of its
subsidiaries or, to the Company's knowledge, any of its Scheduled Foreign
Affiliates, received any written communication from any governmental
authority that alleges that the Company or any of its subsidiaries or
Scheduled Foreign Affiliates is in violation of any Environmental Law;
(ii) there is no claim, action or cause of action filed with a court or
governmental authority, no governmental investigation with respect to which
the Company has received written notice, and no written notice by any
person or entity alleging potential liability for investigatory costs,
cleanup costs, governmental responses costs, natural resources damages,
property damages, personal injuries, attorneys' fees or penalties arising
out of, based on or resulting from the presence, or release into the
environment, of any Material of Environmental Concern at any location
owned, leased or operated by the Company or any of its subsidiaries or, to
the Company's knowledge, any of its Scheduled Foreign Affiliates, now or in
the past (collectively, "Environmental Claims"), pending or, to the
Company's knowledge, threatened against the Company or any of its
subsidiaries or Scheduled Foreign Affiliates; and (iii) to the Company's
knowledge, there are no past or present actions, activities, circumstances,
conditions, events or incidents, including, without limitation, the
release, emission, discharge, presence or disposal of
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any Material of Environmental Concern, that reasonably could result in a
violation of any Environmental Law or form the basis of a potential
Environmental Claim against the Company or any of its Scheduled
Subsidiaries or Scheduled Foreign Affiliates.
(xxiv)The Company and its Scheduled Subsidiaries and any
"employee benefit plan" (as defined under the Employee Retirement Income
Security Act of 1974, as amended, and the regulations and published
interpretations thereunder (collectively, "ERISA")) established or
maintained by the Company, its Scheduled Subsidiaries or their "ERISA
Affiliates" (as defined below) are in compliance in all material respects
with ERISA. "ERISA Affiliate" means, with respect to the Company or a
subsidiary, any member of any group of organizations described in Sections
414(b), (c), (m) or (o) of the Internal Revenue Code of 1986, as amended,
and the regulations and published interpretations thereunder (the "Code")
of which the Company or such subsidiary is a member. No "reportable event"
(as defined under ERISA) has occurred or is reasonably expected to occur
with respect to any "employee benefit plan" established or maintained by
the Company, its subsidiaries or any of their ERISA Affiliates. No
"employee benefit plan" established or maintained by the Company, its
Scheduled Subsidiaries or any of their ERISA Affiliates, if such "employee
benefit plan" were terminated, would have any material "amount of unfunded
benefit liabilities" (as defined under ERISA). Neither the Company, its
Scheduled Subsidiaries nor any of their ERISA Affiliates has incurred or
reasonably expects to incur any liability under (i) Title IV of ERISA with
respect to termination of, or withdrawal from, any "employee benefit plan"
or (ii) Sections 412, 4971, 4975 or 4980B of the Code. Each "employee
benefit plan" established or maintained by the Company, its Scheduled
Subsidiaries or any of their ERISA Affiliates that is intended to be
qualified under Section 401(a) of the Code is so qualified and, to the
Company's knowledge, nothing has occurred, whether by action or failure to
act, which would cause the loss of such qualification.
(xxv) In connection with the cash tender offer (the "Tender
Offer") made by the Company through its wholly-owned subsidiary, Xxxxx
Xxxxxxxxxxx Australia Pty Limited ("Xxxxx Australia"), for all of the
outstanding capital stock (the "Shares") of Xxxxxxx Mining Services
Limited ("Xxxxxxx"), and the acquisition by Xxxxxxx of 51% of the
outstanding capital stock of Glindemann & Kitching Pty Ltd. ("G&K") and the
subsequent repurchase by G&K of all of G&K's remaining outstanding capital
stock (together, the "G&K Acquisition"):
(A) The making of the Tender Offer, the purchase of the Shares
pursuant thereto (including the statutory compulsory purchase of the
Shares owned by Xxxxxxx stockholders who did not tender such Shares
prior to the expiration of the offer period) and the use of funds to
purchase the Shares, and, to the Company's knowledge, the G&K
Acquisition (collectively, the "Xxxxxxx Transactions"), have been duly
and validly authorized by all necessary corporate action on the part
of the Company and Xxxxx Australia, and, to the Company's knowledge,
Xxxxxxx and G&K, as applicable; the Company and Xxxxx Australia and,
to the Company's knowledge, Xxxxxxx and G&K, as applicable, have all
necessary corporate power and authority to effect and consummate the
Xxxxxxx Transactions; to the Company's knowledge, the Heads of
Agreement dated October 3, 1996, the Letter of Amendment to Heads of
Agreement dated November 1, 1996, the Share Subscription Agreement
dated December 12, 1996, the Share Buy-Back Agreement dated
December 12, 1996 and the Deed of Option by and between Xxxxxxx,
Xxxxxx Pty Ltd and X.X. Xxxx have been duly and validly authorized,
executed and delivered by Xxxxxxx and G&K and are valid and binding
agreements of Xxxxxxx and G&K, enforceable in accordance with their
respective terms, except as such
-9-
enforceability may be limited by bankruptcy, insolvency,
reorganization or laws affecting the rights of creditors generally and
subject to general principles of equity; and, except as otherwise
stated in the Registration Statement and the Prospectus, upon
completion of the Xxxxxxx Transactions (including the statutory
compulsory purchase of the Shares owned by Xxxxxxx stockholders who
did not tender such Shares prior to the expiration of the offer
period), Xxxxx Australia will own of record and beneficially, free and
clear of any security interests, claims, liens, proxies, equities or
other encumbrances, all of the issued and outstanding capital stock of
Xxxxxxx and, to the Company's knowledge, Xxxxxxx will own of record
and beneficially, free and clear of any security interests, claims,
liens, proxies, equities or other encumbrances, all of the issued and
outstanding capital stock of G&K.
(B) The Xxxxxxx Transactions did not and will not result in a
breach or violation of any of the terms and provisions of, or
constitute a default by the Company or Xxxxx Australia, or to the
Company's knowledge, by Xxxxxxx or G&K, under, any statute, rule or
regulation, any material agreement or instrument known to the Company
to which the Company, Xxxxx Australia, Xxxxxxx or G&K, as applicable,
is a party or by which it is bound or to which any of its property is
subject, its charter or by laws, or any order or decree known to the
Company of any court or governmental agency or body having
jurisdiction over the Company, Xxxxx Australia, Xxxxxxx or G&K, as
applicable, or any of its properties; and no consent, approval,
authorization or order of, or filing with, any court or governmental
agency or body is required for the consummation of the Xxxxxxx
Transactions, except such as were duly obtained.
(C) The Company and Xxxxx Australia and, to the Company's
knowledge, Xxxxxxx and G&K, as applicable, have complied in all
material respects with all requirements of all statutes, rules and
regulations applicable to the Xxxxxxx Transactions and complied with
all applicable form, disclosure and other requirements, statutory or
otherwise, and such disclosures did not contain any untrue statement
of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading.
(D) No stop order or restraining order or denial of application
for approval has been issued or proceedings, litigation or
investigation initiated or threatened with respect to the Xxxxxxx
Transactions, as applicable, before the Foreign Investment Review
Board, Australian Securities Commission, Australian Stock Exchange or
any other regulatory, administrative, governmental or public body or
authority or any court.
(b) Each Selling Stockholder, severally and not jointly, represents
and warrants to, and agrees with, the Underwriters as follows:
(i) Such Selling Stockholder is the record and beneficial
owner of, and has, and on the First Closing Date will have, valid and
marketable title to the Securities to be sold by such Selling Stockholder,
free and clear of all security interests, claims, liens, restrictions on
transferability, legends, proxies, equities or other encumbrances; and upon
delivery of and payment for such Securities hereunder, the Underwriters
will acquire valid and marketable title thereto, free and clear of any
security interests, claims, liens, restrictions on transferability,
legends, proxies, equities or other encumbrances. Such Selling Stockholder
is selling the Securities to be sold by
-10-
such Selling Stockholder for such Selling Stockholder's own account and is
not selling such Securities, directly or indirectly, for the benefit of the
Company, and no part of the proceeds of such sale received by such Selling
Stockholder will inure, either directly or indirectly, to the benefit of
the Company other than as described in the Registration Statement and
Prospectus.
(ii) Such Selling Stockholder has the power and authority to
enter into this Agreement and to sell, transfer and deliver the Securities
to be sold by such Selling Stockholder; and such Selling Stockholder
(excluding Marley Associates, Marley Partners, L.P., KKR Partners, Greylock
Investments Limited Partnership and Xxxxxx X. Xxxxxx and his sons and his
retirement trust) has duly authorized, executed and delivered to Xxxxx X.
Xxxxxx and Xxxx X. Xxxxxx, as attorneys-in-fact (the "Attorneys-in-Fact"),
an irrevocable power of attorney (a "Power of Attorney") authorizing and
directing the Attorneys-in-Fact, or either of them, to effect the sale and
delivery of the Securities being sold by such Selling Stockholder, to enter
into this Agreement and to take all such other action as may be necessary
hereunder.
(iii) Such Selling Stockholder (excluding Marley Associates,
Marley Partners, L.P., KKR Partners, Greylock Investments Limited
Partnership and Xxxxxx X. Xxxxxx and his sons and his retirement trust) has
duly authorized and, through the Attorneys-in-Fact, executed and delivered
a Custody Agreement ("Custody Agreement"), which is a valid and binding
obligation of such Selling Stockholder, to National City Bank, as Custodian
(the "Custodian"); pursuant to the Custody Agreement the Selling
Stockholder has placed in custody with the Custodian, for delivery under
this Agreement, the certificates representing the Securities to be sold by
such Selling Stockholder; such certificates represent validly issued,
outstanding, fully paid and nonassessable shares of Common Stock; and such
certificates were duly and properly endorsed in blank for transfer, or were
accompanied by all documents duly and properly executed that are necessary
to validate the transfer of title thereto, to the Underwriters, free of any
legend, restriction on transferability, proxy, lien or claim, whatsoever.
(iv) This Agreement and, as applicable, the Custody Agreement
and the Power of Attorney have each been duly authorized, executed and
delivered by or on behalf of such Selling Stockholder and each constitutes
a valid and binding agreement of such Selling Stockholder, enforceable in
accordance with its terms, except as rights to indemnity hereunder or
thereunder may be limited by federal or state securities laws and except as
such enforceability may be limited by bankruptcy, insolvency,
reorganization or laws affecting the rights of creditors generally and
subject to general principles of equity. The execution and delivery of
this Agreement and, as applicable, the Custody Agreement and the Power of
Attorney and the performance of the terms hereof and thereof and the
consummation of the transactions herein and therein contemplated will not
result in a breach or violation of any of the terms and provisions of, or
constitute a default under, any material agreement or instrument to which
such Selling Stockholder is a party or by which such Selling Stockholder is
bound, or any law, regulation, order or decree applicable to such Selling
Stockholder; no consent, approval, authorization or order of, or filing
with, any court or governmental agency or body is required for the
execution, delivery and performance of this Agreement or, as applicable,
the Custody Agreement and the Power of Attorney or for the consummation of
the transactions contemplated hereby and thereby, including the sale of the
Securities being sold by such Selling Stockholder, except such as may be
required under the Act or state securities laws or blue sky laws.
(v) Such Selling Stockholder has not distributed and will not
distribute any prospectus or other offering material in connection with the
offering and sale of the Securities other
-11-
than any Preliminary Prospectus or the Prospectus or other materials
permitted by the Act to be distributed by such Selling Stockholder.
(vi) Such Selling Stockholder has reviewed the disclosure with
respect to such Selling Stockholder in the section of the Prospectus
entitled "Principal and Selling Stockholders" and such disclosure does not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading regarding such Selling Stockholder.
(c) Any certificate signed by any officer of the Company and
delivered to you or to counsel for the Underwriters shall be deemed a
representation and warranty by the Company to each Underwriter as to the matters
covered thereby; and any certificate signed by or on behalf of any Selling
Stockholder as such and delivered to you or to counsel for the Underwriters
shall be deemed a representation and warranty by such Selling Stockholder to
each Underwriter as to the matters covered thereby.
3. PURCHASE, SALE AND DELIVERY OF SECURITIES.
(a) On the basis of the representations, warranties and agreements
herein contained, but subject to the terms and conditions herein set forth, the
Company agrees to issue and sell 2,006,565 Firm Shares, and each Selling
Stockholder agrees, severally and not jointly, to sell the number of Firm Shares
set forth opposite the name of such Selling Stockholder in Schedule I hereto, to
the Underwriters, and each Underwriter agrees, severally and not jointly, to
purchase from the Company and the Selling Stockholders the number of Firm Shares
set forth opposite the name of such Underwriter in Schedule II hereto. The
purchase price for each Firm Share shall be $ per share. The obligation of
each Underwriter to each of the Company and the Selling Stockholders shall be to
purchase from each of the Company and the Selling Stockholders that number of
Firm Shares (to be adjusted by the Underwriters to avoid fractional shares)
which represents the same proportion of the number of Firm Shares to be sold by
each of the Company and the Selling Stockholders pursuant to this Agreement as
the number of Firm Shares set forth opposite the name of such Underwriter in
Schedule II hereto represents to the total number of Firm Shares to be purchased
by the Underwriters pursuant to this Agreement. In making this Agreement, each
Underwriter is contracting severally and not jointly; except as provided in
paragraph (c) of this Section 3 and in Section 8 hereof, the agreement of each
Underwriter is to purchase only the respective number of Firm Shares specified
in Schedule II.
The Firm Shares will be delivered by the Company and the Custodian to
the Underwriters against payment of the purchase price therefor by immediately
available funds payable to the order of the Company and the Custodian, as
appropriate, at the offices of Xxxxx Xxxxxxx Inc., Xxxxx Xxxxxxx Tower,
000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx, or such other location as may be
mutually acceptable, at 9:00 a.m. Central time on the third (or if the
Securities are priced, as contemplated by Rule 15c6-1(c) under the Exchange Act,
after 4:30 p.m. Eastern time, the fourth) full business day following the date
hereof, or at such other time and date as you and the Company determine pursuant
to Rule 15c6-1(a) under the Exchange Act, such time and date of delivery being
herein referred to as the "First Closing Date." If the Underwriters so elect,
delivery of the Firm Shares may be made by credit through full fast transfer to
the accounts at The Depository Trust Company designated by the Underwriters.
Certificates representing the Firm Shares, in definitive form and in such
denominations and registered in such names as you may request upon at least two
business days' prior notice to the Company and the Custodian, will be made
available for checking and packaging not later than 10:30 a.m., Central time, on
the business day next preceding the First Closing Date
-12-
at the offices of Xxxxx Xxxxxxx Inc., Xxxxx Xxxxxxx Tower, 000 Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx, or such other location as may be mutually
acceptable.
(b) On the basis of the representations, warranties and agreements
herein contained, but subject to the terms and conditions herein set forth, the
Company hereby grants to the Underwriters an option to purchase all or any
portion of the Option Shares at the same purchase price as the Firm Shares, for
use solely in covering any over-allotments made by the Underwriters in the sale
and distribution of the Firm Shares. The option granted hereunder may be
exercised at any time (but not more than once) within 30 days after the
effective date of this Agreement upon notice (confirmed in writing) by the
Underwriters to the Company setting forth the aggregate number of Option Shares
as to which the Underwriters are exercising the option, the names and
denominations in which the certificates for the Option Shares are to be
registered and the date and time, as determined by you, when the Option Shares
are to be delivered, such time and date being herein referred to as the "Second
Closing" and "Second Closing Date", respectively; provided, however, that the
Second Closing Date shall not be earlier than the First Closing Date nor earlier
than the second business day after the date on which the option shall have been
exercised. If the option is exercised, the number of Option Shares to be
purchased by each Underwriter shall be the same percentage of the total number
of Option Shares to be purchased by the Underwriters as the number of Firm
Shares to be purchased by such Underwriter is of the total number of Firm Shares
to be purchased by the Underwriters, as adjusted by the Underwriters in such
manner as the Underwriters deem advisable to avoid fractional shares. No Option
Shares shall be sold and delivered unless the Firm Shares previously have been,
or simultaneously are, sold and delivered.
The Option Shares will be delivered by the Company to the Underwriters
against payment of the purchase price therefor by immediately available funds
payable to the order of the Company at the offices of Xxxxx Xxxxxxx Inc., Xxxxx
Xxxxxxx Tower, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx, or such other
location as may be mutually acceptable at 9:00 a.m., Central time, on the Second
Closing Date. If the Underwriters so elect, delivery of the Option Shares may
be made by credit through full fast transfer to the accounts at The Depository
Trust Company designated by the Underwriters. Certificates representing the
Option Shares in definitive form and in such denominations and registered in
such names as you have set forth in your notice of option exercise, will be made
available for checking and packaging not later than 10:30 a.m., Central time, on
the business day next preceding the Second Closing Date at the office of Xxxxx
Xxxxxxx Inc., Xxxxx Xxxxxxx Tower, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxxxx,
Xxxxxxxxx, or such other location as may be mutually acceptable.
(c) It is understood that either Underwriter, may (but shall not be
obligated to) make payment to the Company or the Selling Stockholders, on behalf
of the other Underwriter for the Securities to be purchased by such other
Underwriter. Any such payment by an Underwriter shall not relieve any such
other Underwriter of any of its obligations hereunder. Nothing herein contained
shall constitute any of the Underwriters an unincorporated association or
partner with the Company or any Selling Stockholder.
4. COVENANTS.
(a) The Company covenants and agrees with the Underwriters as
follows:
(i) If the Registration Statement has not already been
declared effective by the Commission, the Company will use its best efforts
to cause the Registration Statement and any post-effective amendments
thereto to become effective as promptly as possible; the Company will
notify you promptly of the time when the Registration Statement or any
post-effective amendment to the Registration Statement has become effective
or any supplement to the Prospectus (including
-13-
any term sheet within the meaning of Rule 434 of the Rules and Regulations)
has been filed and of any request by the Commission for any amendment or
supplement to the Registration Statement or Prospectus or additional
information; if the Company has elected to rely on Rule 430A of the Rules
and Regulations, the Company will prepare and file a Prospectus (or term
sheet within the meaning of Rule 434 of the Rules and Regulations)
containing the information omitted therefrom pursuant to Rule 430A of the
Rules and Regulations with the Commission within the time period required
by, and otherwise in accordance with the provisions of, Rules 424(b), 430A
and 434, if applicable, of the Rules and Regulations; if the Company has
elected to rely upon Rule 462(b) of the Rules and Regulations to increase
the size of the offering registered under the Act, the Company will prepare
and file a registration statement with respect to such increase with the
Commission within the time period required by, and otherwise in accordance
with the provisions of, Rule 462(b); the Company will prepare and file with
the Commission, promptly upon your request, any amendments or supplements
to the Registration Statement or Prospectus (including any term sheet
within the meaning of Rule 434 of the Rules and Regulations) that, in your
opinion, may be necessary or advisable in connection with the distribution
of the Securities by the Underwriters; and the Company will not file any
amendment or supplement to the Registration Statement or Prospectus
(including any term sheet within the meaning of Rule 434 of the Rules and
Regulations) to which you shall reasonably object by notice to the Company
after having been furnished a copy a reasonable time prior to the filing.
(ii) The Company will advise you, promptly after it shall
receive notice or obtain knowledge thereof, of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement, of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, or of the initiation
or threatening of any proceeding for any such purpose; and the Company will
promptly use its best efforts to prevent the issuance of any stop order or
to obtain its withdrawal if such a stop order should be issued.
(iii) Within the time during which a prospectus (including any
term sheet within the meaning of Rule 434 of the Rules and Regulations)
relating to the Securities is required to be delivered under the Act, the
Company will comply as far as it is able with all requirements imposed upon
it by the Act, as now and hereafter amended, and by the Rules and
Regulations, as from time to time in force, so far as necessary to permit
the continuance of sales of or dealings in the Securities as contemplated
by the provisions hereof and the Prospectus. If during such period any
event occurs as a result of which the Prospectus would include an untrue
statement of a material fact or omit to state a material fact necessary to
make the statements therein, in the light of the circumstances then
existing, not misleading, or if during such period it is necessary to amend
the Registration Statement or supplement the Prospectus to comply with the
Act, the Company will promptly notify you and will amend the Registration
Statement or supplement the Prospectus (at the expense of the Company) so
as to correct such statement or omission or effect such compliance.
(iv) The Company shall cooperate with the Underwriters and
counsel for the Underwriters to qualify the Securities for sale under the
securities laws of such jurisdictions as you reasonably designate and to
continue such qualifications in effect so long as required for the
distribution of the Securities, except that the Company shall not be
required in connection therewith to qualify as a foreign corporation or to
execute a general consent to service of process in any state.
(v) The Company will furnish to the Underwriters copies of the
Registration Statement (three of which will be signed and will include all
exhibits), each Preliminary Prospectus, the Prospectus, and all amendments
and supplements (including any term sheet within the meaning
-14-
of Rule 434 of the Rules and Regulations) to such documents, in each case
as soon as available and in such quantities as you may from time to time
reasonably request.
(vi) The Company will make generally available to its security
holders as soon as practicable, but in any event not later than 15 months
after the end of the Company's current fiscal quarter, an earnings
statement (which need not be audited) covering a 12-month period beginning
after the effective date of the Registration Statement that shall satisfy
the provisions of Section 11(a) of the Act and Rule 158 of the Rules and
Regulations.
(vii) The Company, whether or not the transactions contemplated
hereunder are consummated or this Agreement is prevented from becoming
effective under the provisions of Section 9(a) hereof or is terminated,
will pay or cause to be paid (A) all expenses (including transfer taxes
allocated to the respective transferees) incurred in connection with the
delivery to the Underwriters of the Securities, (B) all expenses and fees
(including, without limitation, fees and expenses of the Company's
accountants and counsel but, except as otherwise provided below, not
including fees of the Underwriters' counsel) in connection with the
preparation, printing, filing, delivery, and shipping of the Registration
Statement (including the financial statements therein and all amendments,
schedules, and exhibits thereto), the Securities, each Preliminary
Prospectus, the Prospectus, and any amendment thereof or supplement
thereto, and the printing, delivery, and shipping of this Agreement and
other underwriting documents, including Blue Sky Memoranda, (C) all filing
fees and fees and disbursements of the Underwriters' counsel incurred in
connection with the qualification of the Securities for offering and sale
by the Underwriters or by dealers under the securities or blue sky laws of
the states and other jurisdictions which you shall designate in accordance
with Section 4(a)(iv) hereof, (D) the fees and expenses of any transfer
agent or registrar, (E) the filing fees incident to any required review by
the National Association of Securities Dealers, Inc. of the terms of the
sale of the Securities, (F) listing fees, if any, and (G) all other costs
and expenses incident to the performance of its obligations hereunder that
are not otherwise specifically provided for herein. If the sale of the
Securities provided for herein is not consummated by reason of action by
the Company pursuant to Section 9(a) hereof which prevents this Agreement
from becoming effective, or by reason of any failure, refusal or inability
on the part of the Company or the Selling Stockholders to perform any
agreement on its or their part to be performed, or because any other
condition of the Underwriters' obligations hereunder required to be
fulfilled by the Company or the Selling Stockholders is not fulfilled, the
Company will reimburse the Underwriters for all reasonable out-of-pocket
disbursements (including fees and disbursements of counsel) incurred by the
Underwriters in connection with their investigation, preparing to market
and marketing the Securities or in contemplation of performing their
obligations hereunder. The Company shall not in any event be liable to any
of the Underwriters for loss of anticipated profits from the transactions
covered by this Agreement.
(viii) The Company will apply the net proceeds from the sale of
the Securities to be sold by it hereunder for the purposes set forth in the
Prospectus.
(ix) The Company will not, without the prior written consent of
Xxxxx Xxxxxxx Inc., directly or indirectly offer for sale, sell, contract
to sell, grant any option for the sale of or otherwise issue or dispose of
any shares of Common Stock, options or warrants to acquire shares of Common
Stock, or any security or instrument related thereto, except to the
Underwriters pursuant to this Agreement for a period of 90 days after the
date of this Agreement; provided, however, that the foregoing prohibition
shall not apply to sales by the Company in connection with the exercise of
options granted pursuant to the Company's existing stock option plans nor
to grants of options at
-15-
fair market value on the date of grant (except with respect to options the
Company has previously committed to grant in connection with the ground
freeze contract with Echo Bay Mines Ltd.) under the Company's existing
stock option plans which do not exceed options for the purchase of an
aggregate of 350,000 shares of Common Stock.
(x) The Company either has caused to be delivered to you or
will cause to be delivered to you prior to the effective date of the
Registration Statement a letter from each of the Company's directors and
officers and from certain stockholders stating that such person agrees that
he, she or it will not, without the prior written consent of Xxxxx Xxxxxxx
Inc., directly or indirectly offer for sale, sell, contract to sell, grant
any option for the sale of or otherwise dispose of any shares of Common
Stock, options or warrants to acquire shares of Common Stock, or any
security or instrument related thereto, except to the Underwriters pursuant
to this Agreement, for a period of 90 days after the date of this
Agreement.
(xi) The Company has not taken and will not take, directly or
indirectly, any action designed to or which might reasonably be expected to
cause or result in, or which has constituted, the stabilization or
manipulation of the price of any security of the Company to facilitate the
sale or resale of the Securities, and has not effected any sales of Common
Stock which are required to be disclosed in response to Item 701 of
Regulation S-K under the Act which have not been so disclosed in the
Registration Statement.
(xii) The Company will inform the Florida Department of Banking
and Finance at any time prior to the consummation of the distribution of
the Securities by the Underwriters if it commences engaging in business
with the government of Cuba or with any person or affiliate located in
Cuba. Such information will be provided within 90 days after the
commencement thereof or after a change occurs with respect to previously
reported information.
(xiii) With respect to the Company, Xxxxx Australia and Xxxxxxx,
the Company will take, or cause to be taken, and with respect to G&K the
Company will use all reasonable efforts to cause to be taken, all action
necessary to ensure that the Company, Xxxxx Australia, Xxxxxxx and G&K
complete the Xxxxxxx Transactions.
(b) Each Selling Stockholder, severally and not jointly, covenants
and agrees with the Underwriters as follows:
(i) Except as otherwise agreed to by the Company and the
Selling Stockholder, such Selling Stockholder will pay all taxes, if any,
on the transfer and sale, respectively, of the Securities being sold by
such Selling Stockholder, the fees of such Selling Stockholder's counsel
and such Selling Stockholder's proportionate share (based upon the number
of Securities being offered by such Selling Stockholder pursuant to the
Registration Statement) of all costs and expenses (except for legal and
accounting expenses and fees of the registrar and transfer agent) incurred
by the Company pursuant to the provisions of Section 4(a)(vii) of this
Agreement; provided, however, that each Selling Stockholder severally
agrees to reimburse the Company for any reimbursement made by the Company
to the Underwriters pursuant to Section 4(a)(vii) hereof to the extent such
reimbursement resulted from the failure or refusal on the part of such
Selling Stockholder to comply under the terms or fulfill any of the
conditions of this Agreement.
-16-
(ii) If this Agreement shall be terminated by the Underwriters
because of any failure, refusal or inability on the part of such Selling
Stockholder to perform any agreement on such Selling Stockholder's part to
be performed, or because any other condition of the Underwriters'
obligations hereunder required to be fulfilled by such Selling Stockholder
is not fulfilled, such Selling Stockholder agrees to reimburse the
Underwriters for all reasonable out-of-pocket disbursements (including fees
and disbursements of counsel for the Underwriters) incurred by the
Underwriters in connection with their investigation, preparing to market
and marketing the Securities or in contemplation of performing their
obligations hereunder. The Selling Stockholder shall not in any event be
liable to any of the Underwriters for loss of anticipated profits from the
transactions covered by this Agreement.
(iii) The Securities to be sold by such Selling Stockholder
(excluding Marley Associates, Marley Partners, L.P., KKR Partners, Greylock
Investments Limited Partnership and Xxxxxx X. Xxxxxx and his sons and his
retirement trust), represented by the certificates on deposit with the
Custodian pursuant to the Custody Agreement of such Selling Stockholder,
are subject to the interest of the Underwriters and the other Selling
Stockholders; the arrangements made for such custody are, except as
specifically provided in the Custody Agreement, irrevocable; and the
obligations of such Selling Stockholder hereunder shall not be terminated,
except as provided in this Agreement or in the Custody Agreement, by any
act of such Selling Stockholder, by operation of law, whether by the
liquidation, dissolution or merger of such Selling Stockholder, by the
death of such Selling Stockholder, or by the occurrence of any other event.
If any Selling Stockholder should liquidate, dissolve or be a party to a
merger or if any other such event should occur before the delivery of the
Securities hereunder, certificates for the Securities deposited with the
Custodian shall be delivered by the Custodian in accordance with the terms
and conditions of this Agreement as if such liquidation, dissolution,
merger or other event had not occurred, whether or not the Custodian shall
have received notice thereof.
(iv) In the case of Marley Associates, Marley Partners, L.P.,
KKR Partners, Greylock Investments Limited Partnership and Xxxxxx X. Xxxxxx
and his sons and his retirement trust, the Securities to be sold by such
Selling Stockholder are subject to the interest of the Underwriters and the
other Selling Stockholders; and the obligations of such Selling Stockholder
hereunder shall not be terminated, except as provided in this Agreement, by
any act of such Selling Stockholder, by operation of law, whether by the
liquidation, dissolution or merger of such Selling Stockholder, by the
death of such Selling Stockholder, or by the occurrence of any other event.
If any Selling Stockholder should liquidate, dissolve or be a party to a
merger or if any other such event should occur before the delivery of the
Securities hereunder, certificates for the Securities to be sold hereunder
shall be delivered in accordance with the terms and conditions of this
Agreement as if such liquidation, dissolution, merger or other event had
not occurred.
(v) Such Selling Stockholder will not, without the prior
written consent of Xxxxx Xxxxxxx Inc., directly or indirectly offer for
sale, sell, contract to sell, grant any option for the sale of or otherwise
dispose of any shares of Common Stock, options or warrants to acquire
shares of Common Stock, or any security or instrument related thereto,
except to the Underwriters pursuant to this Agreement, for a period of
90 days after the date of this Agreement.
(vi) Such Selling Stockholder has not taken and will not take,
directly or indirectly, any action designed to or which might reasonably be
expected to cause or result in
-17-
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Securities.
(vii) Such Selling Stockholder shall immediately notify you if
any event occurs, or of any change in information relating to such Selling
Stockholder disclosed under the heading "Principal and Selling
Stockholders" in the Prospectus or any supplement thereto (including any
term sheet within the meaning of Rule 434 of the Rules and Regulations),
which results in the Prospectus (as supplemented) including an untrue
statement of a material fact or omitting to state any material fact
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading regarding such Selling
Stockholder.
5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of the
Underwriters hereunder are subject to the accuracy, as of the date hereof and at
each of the First Closing Date and the Second Closing Date (as if made at such
Closing Date), of and compliance with all representations, warranties and
agreements of the Company and the Selling Stockholders contained herein, to the
performance by the Company and the Selling Stockholders of their respective
obligations hereunder and to the following additional conditions:
(a) The Registration Statement shall have become effective not later
than 5:00 p.m., Central time, on the date of this Agreement, or such later time
and date as the Underwriters shall approve and all filings required by
Rules 424, 430A and 434 of the Rules and Regulations shall have been timely
made; no stop order suspending the effectiveness of the Registration Statement
or any amendment thereof shall have been issued; no proceedings for the issuance
of such an order shall have been initiated or threatened; and any request of the
Commission for additional information (to be included in the Registration
Statement or the Prospectus or otherwise) shall have been complied with to your
satisfaction.
(b) No Underwriter shall have advised the Company that the
Registration Statement or the Prospectus, or any amendment thereof or supplement
thereto (including any term sheet within the meaning of Rule 434 of the Rules
and Regulations), contains an untrue statement of fact which, in your opinion,
is material, or omits to state a fact which, in your opinion, is material and is
required to be stated therein or necessary to make the statements therein not
misleading.
(c) Except as contemplated in the Prospectus or elsewhere in this
Agreement, subsequent to the respective dates as of which information is given
in the Registration Statement and the Prospectus (A) neither the Company nor any
of its Scheduled Subsidiaries, nor, to the Company's knowledge, any of its
Scheduled Foreign Affiliates, shall have incurred any material liabilities or
obligations, direct or contingent, or entered into any material transactions not
in the ordinary course of business, or, in the case of the Company, declared or
paid any dividends or made any distribution of any kind with respect to its
capital stock; and (B) there shall not have been any change in the capital stock
(other than a change in the number of outstanding shares of Common Stock due to
the issuance of shares upon the exercise of outstanding options or warrants), or
any material change in the consolidated short-term or long-term debt of the
Company and its subsidiaries, or any issuance of options, warrants, convertible
securities or other rights to purchase the capital stock of the Company or any
of its Scheduled Subsidiaries, or to the Company's knowledge, any of its
Scheduled Foreign Affiliates, the effect of which, in any such case described in
(A) or (B), is in your judgment so material and adverse as to make it
impracticable or inadvisable to offer or deliver the Securities on the terms and
in the manner contemplated in the Prospectus; and (C) there shall not have been
any Material Adverse Change that, in your judgment, makes it impractical or
inadvisable to offer or deliver the Securities on the terms and in the manner
contemplated in the Prospectus.
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(d) On each Closing Date, there shall have been furnished to the
Underwriters opinions of Xxxxxx & Xxxxxxx, Xxxx X. Xxxxxx, Xxxxx & XxXxxxxx,
XxxXxxxxx Matthews, Alfaro, Xxxxxx, Xxxxxxx & Xxxxxx and Estudio Xxxx Echecopar
Xxxxxx, counsel for the Company, and Xxxxxx Partners, counsel for Xxxxxxx, dated
such Closing Date and addressed to you, to the effect that:
(i) Each of the Company and the Scheduled Subsidiaries
specifically identified for purposes of this Section 5(d) on Schedule III
hereto and each of the Scheduled Foreign Affiliates (collectively, the
"Scheduled Entities") has been duly incorporated and is validly existing as
a corporation in good standing under the laws of its jurisdiction of
incorporation. Each of the Company and its Scheduled Entities has full
corporate power and authority to own its properties and conduct its
business as currently being carried on and as described in the Registration
Statement and Prospectus.
(ii) The capital stock of the Company conforms as to legal
matters to the description thereof contained in the Prospectus under the
caption "Description of Capital Stock." All of the issued and outstanding
shares of the capital stock of the Company have been duly authorized and
validly issued and are fully paid and nonassessable. The Securities to be
issued and sold by the Company hereunder have been duly authorized and,
when issued, delivered and paid for in accordance with the terms of this
Agreement, will have been validly issued and will be fully paid and
nonassessable. Except as otherwise stated in the Registration Statement
and Prospectus, there are no preemptive rights or other rights to subscribe
for or to purchase, or any restriction upon the voting or (except as set
forth in stock and stock option agreements with employees and former
employees) transfer of, any shares of Common Stock pursuant to the
Company's charter, by-laws or any agreement or other instrument known to
such counsel to which the Company is a party or by which the Company is
bound, and, to the best of such counsel's knowledge, except as stated in
the Registration Statement and the Prospectus, neither the filing of the
Registration Statement nor the offering or sale of the Securities as
contemplated by this Agreement gives rise to any rights for or relating to
the registration of any shares of Common Stock or other securities of the
Company, except to the extent waived or satisfied.
(iii) All of the issued and outstanding shares of capital stock
of each of the Company's Scheduled Entities have been duly and validly
authorized and issued and are fully paid and nonassessable, and the holders
thereof are not subject to personal liability by reason of being such
holders, and, to such counsel's knowledge, except as otherwise described in
the Registration Statement and Prospectus, the Company owns of record and
beneficially, free and clear of any security interests, claims, liens,
proxies, equities or other encumbrances, all of the issued and outstanding
shares of such stock.
(iv) The Registration Statement has become effective under the
Act and, to such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceeding for that purpose has been instituted or, to the knowledge of
such counsel, threatened by the Commission.
(v) The description in the Registration Statement and
Prospectus of the governmental investigation set forth under the caption
"Business - Regulatory and Environmental Matters" is accurate and fairly
presents the information required to be shown; and such counsel does not
know of any statutes or legal or governmental proceedings required to be
described in the Prospectus that are not described as required, or of any
contracts or documents of a character
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required to be described in the Registration Statement or Prospectus or
included as exhibits to the Registration Statement that are not described
or included as required.
(vi) The Company has full corporate power and authority to
enter into this Agreement, and this Agreement has been duly authorized,
executed and delivered by the Company and constitutes a valid, legal and
binding obligation of the Company enforceable in accordance with its terms
(except as rights to indemnity hereunder may be limited by federal or state
securities laws and except as such enforceability may be limited by
bankruptcy, insolvency, reorganization or similar laws affecting the rights
of creditors generally and subject to general principles of equity); the
execution, delivery and performance of this Agreement and the consummation
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, any statute, rule or regulation, any material agreement or
instrument known to such counsel to which the Company is a party or by
which it is bound or to which any of its property is subject, the Company's
charter or by-laws, or any order or decree known to such counsel of any
court or governmental agency or body having jurisdiction over the Company
or any of its respective properties; and no consent, approval,
authorization or order of, or filing with, any court or governmental agency
or body is required for the execution, delivery and performance of this
Agreement or for the consummation of the transactions contemplated hereby,
including the issuance or sale of the Securities by the Company, except
such as may be required under the Act or state securities laws.
(vii) Each document filed pursuant to the Exchange Act (other
than the financial statements and supporting schedules included therein, as
to which no opinion need be rendered) and incorporated or deemed to be
incorporated by reference in the Prospectus complied when so filed as to
form in all material respects with the Exchange Act.
(viii) The Registration Statement and the Prospectus, and any
amendment thereof or supplement thereto (including any term sheet within
the meaning of Rule 434 of the Rules and Regulations), comply as to form in
all material respects with the requirements of the Act and the Rules and
Regulations; and on the basis of conferences with officers of the Company,
examination of documents referred to in the Registration Statement and
Prospectus and such other procedures as such counsel deemed appropriate,
nothing has come to the attention of such counsel that causes such counsel
to believe that the Registration Statement or any amendment thereof, at the
time the Registration Statement became effective and as of such Closing
Date (including any Registration Statement filed under Rule 462(b) of the
Rules and Regulations), 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 (as of its date and as of such Closing Date), as amended or
supplemented, includes any untrue statement of material fact or omits to
state a material fact necessary to make the statements therein, in 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 or other financial data included in any of the documents
mentioned in this clause.
(ix) In connection with the Xxxxxxx Transactions:
(A) The Xxxxxxx Transactions have been duly and validly
authorized by all necessary corporate action on the part of the
Company, Xxxxx Australia and Xxxxxxx, as applicable; the Company,
Xxxxx Australia and Xxxxxxx, as applicable, have all necessary
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corporate power and authority to effect and consummate the Xxxxxxx
Transactions; the Heads of Agreement dated October 3, 1996, the Letter
of Amendment to Heads of Agreement dated November 1, 1996, the Share
Subscription Agreement dated December 12, 1996, Share Buy-Back
Agreement dated December 12, 1996 and the Deed of Option by and
between Xxxxxxx, Xxxxxx Pty Ltd and X.X. Xxxx have been duly and
validly authorized, executed and delivered by Xxxxxxx and are valid
and binding agreements of Xxxxxxx, enforceable in accordance with
their respective terms; and, upon completion of the Xxxxxxx
Transactions, Xxxxx Australia will own of record and beneficially,
free and clear of any security interests, claims, liens, proxies,
equities or other encumbrances, all of the issued and outstanding
capital stock of Xxxxxxx and Xxxxxxx will own of record and
beneficially, free and clear of any security interests, claims, liens,
proxies, equities or other encumbrances, all of the issued and
outstanding capital stock of G&K.
(B) The Xxxxxxx Transactions did not and will not result in a
breach or violation of any of the terms and provisions of, or
constitute a default under, any statute, rule or regulation, any
material agreement or instrument known to such counsel to which the
Company, Xxxxx Australia or Xxxxxxx, as applicable, is a party or by
which it is bound or to which any of its property is subject, its
charter or by laws, or any order or decree known to such counsel of
any court or governmental agency or body having jurisdiction over the
Company, Xxxxx Australia or Xxxxxxx, as applicable, or any of its
properties; and no consent, approval, authorization or order of, or
filing with, any court or governmental agency or body is required for
the consummation of the Xxxxxxx Transactions, except such as were duly
obtained.
(C) The Company, Xxxxx Australia and Xxxxxxx, as applicable,
have complied in all material respects with all requirements of all
statutes, rules and regulations applicable to the Xxxxxxx
Transactions; complied with all applicable form, disclosure and other
requirements, statutory or otherwise, and such disclosures did not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in 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 or other financial
data included in any of the documents mentioned in this clause.
(D) To the knowledge of such counsel, no stop order or
restraining order or denial of application for approval has been
issued or proceedings, litigation or investigation initiated or
threatened with respect to the Xxxxxxx Transactions, as applicable,
before the Foreign Investment Review Board, Australian Securities
Commission, Australian Stock Exchange or any other regulatory,
administrative, governmental or public body or authority or any court.
(e) On the First Closing Date, there shall have been furnished to
you, the opinion of each respective counsel for the Selling Stockholders, dated
such Closing Date and addressed to you, to the effect that as to each of the
Selling Stockholders represented thereby:
(i) Each of the Selling Stockholders is the sole record and
beneficial owner of the Securities to be sold by such Selling Stockholder,
and upon delivery of the certificates for the Securities to be sold by each
Selling Stockholder pursuant to this Agreement, and upon payment
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therefor by the Underwriters, will pass good and valid title to such
Securities to the Underwriters and the Underwriters will acquire all the
rights of such Selling Stockholder in the Securities (assuming the
Underwriters have no knowledge of an adverse claim), free and clear of any
security interests, claims, liens or other encumbrances.
(ii) Each of the Selling Stockholders has the power and
authority to enter into this Agreement and, as applicable, the Custody
Agreement and the Power of Attorney, and to perform and discharge such
Selling Stockholder's obligations thereunder and hereunder; and this
Agreement, and, as applicable, the Custody Agreements and the Powers of
Attorney have been duly and validly authorized, executed and delivered by
(or by the Attorneys-in-Fact, or either of them, on behalf of) the Selling
Stockholders and are valid and binding agreements of the Selling
Stockholders, enforceable in accordance with their respective terms (except
as rights to indemnity hereunder or thereunder may be limited by federal or
state securities laws and except as such enforceability may be limited by
bankruptcy, insolvency, reorganization or similar laws affecting creditors'
rights generally and subject to general principles of equity).
(iii) The execution and delivery of this Agreement and, as
applicable, the Custody Agreement and the Power of Attorney and the
performance of the terms hereof and thereof and the consummation of the
transactions herein and 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, rule or regulation, or any agreement or instrument
known to such counsel to which such Selling Stockholder is a party or by
which such Selling Stockholder is bound or to which any of its property is
subject, any such Selling Stockholder's charter or by-laws, or any order or
decree known to such counsel of any court or government agency or body
having jurisdiction over such Selling Stockholder or any of its respective
properties; and no consent, approval, authorization or order of, or filing
with, any court or governmental agency or body is required for the
execution, delivery and performance of this Agreement and, as applicable,
the Custody Agreement and the Power of Attorney or for the consummation of
the transactions contemplated hereby and thereby, including the sale of the
Securities being sold by such Selling Stockholder, except such as may be
required under the Act or state securities laws or blue sky laws.
(f) On each Closing Date, there shall have been furnished to the
Underwriters such opinion or opinions from Faegre & Xxxxxx LLP, counsel for the
Underwriters, dated such Closing Date and addressed to you, with respect to the
formation of the Company, the validity of the Securities, the Registration
Statement, the Prospectus and other related matters as you reasonably may
request, and such counsel shall have received such papers and information as
they request to enable them to pass upon such matters.
(g) On each Closing Date the Underwriters shall have received a
letter of each of Deloitte & Touche LLP and KPMG, dated such Closing Date and
addressed to you, confirming that they are independent public accountants within
the meaning of the Act and are in compliance with the applicable requirements
relating to the qualifications of accountants under Rule 2-01 of Regulation S-X
of the Commission, and stating, as of the date of such letter (or, with respect
to matters involving changes or developments since the respective dates as of
which specified financial information is given in the Prospectus, as of a date
not more than five days prior to the date of such letter), the conclusions and
findings of said firm with respect to the financial information and other
matters covered by its letter delivered to you concurrently with the execution
of this Agreement, and the effect of the letter so to be delivered on such
Closing Date shall be to confirm the conclusions and findings set forth in such
prior letter.
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(h) On each Closing Date, there shall have been furnished to the
Underwriters a certificate of the Company, dated such Closing Date and addressed
to you, signed by the chief executive officer and by the chief financial officer
of the Company, to the effect that:
(i) The representations and warranties of the Company in this
Agreement are true and correct, in all material respects, as if made at and
as of such Closing Date, and the Company has complied with all the
agreements and satisfied all the conditions on its part to be performed or
satisfied at or prior to such Closing Date;
(ii) No stop order or other order suspending the effectiveness
of the Registration Statement or any amendment thereof or the qualification
of the Securities for offering or sale has been issued, and no proceeding
for that purpose has been instituted or, to the best of their knowledge, is
contemplated by the Commission or any state or regulatory body; and
(iii) The signers of said certificate have carefully examined
the Registration Statement and the Prospectus, and any amendments thereof
or supplements thereto (including any term sheet within the meaning of Rule
434 of the Rules and Regulations), and (A) such documents contain all
statements and information required to be included therein, and the
Registration Statement, or any amendment thereof, does not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading, and the Prospectus, as amended or supplemented, does not
include any untrue statement of material fact or omit to state a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, (B) since the
effective date of the Registration Statement, there has occurred no event
required to be set forth in an amended or supplemented prospectus which has
not been so set forth, (C) except as contemplated in the Prospectus or
elsewhere in this Agreement, subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus
(I) neither the Company nor any of its Scheduled Subsidiaries nor, to the
Company's knowledge, any of its Scheduled Foreign Affiliates, has incurred
any material liabilities or obligations, direct or contingent, or entered
into any material transactions, not in the ordinary course of business, or
in the case of the Company, declared or paid any dividends or made any
distribution of any kind with respect to its capital stock; and (II) there
has not been any change in the capital stock (other than a change in the
number of outstanding shares of Common Stock due to the issuance of shares
upon the exercise of outstanding options or warrants), or any material
change in the consolidated short-term or long-term debt of the Company and
its subsidiaries, or any issuance of options, warrants, convertible
securities or other rights to purchase the capital stock of the Company or
any of its Scheduled Subsidiaries or, to the Company's knowledge, any of
its Scheduled Foreign Affiliates, the effect of which, in any such case
described in (I) or (II), is material and adverse; and (III) there has not
been any Material Adverse Change, and (D) except as stated in the
Registration Statement and the Prospectus, there is not pending any action,
suit or proceeding to which the Company or any of its subsidiaries or, to
the Company's knowledge, any of its Scheduled Foreign Affiliates is a party
before or by any court or governmental agency, authority or body, or any
arbitrator, which might result in any Material Adverse Change and there is
not, to the Company's knowledge, threatened or contemplated any action,
suit or proceeding to which the Company or any of its subsidiaries or
Scheduled Foreign Affiliates is a party before or by any court or
governmental agency, authority or body, or any arbitrator, which might
result in any Material Adverse Change.
(i) On the First Closing Date, there shall have been furnished to the
Underwriters a certificate or certificates, dated such Closing Date and
addressed to you, signed by each of the Selling
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Stockholders or either of such Selling Stockholder's Attorneys-in-Fact to the
effect that the representations and warranties of such Selling Stockholder
contained in this Agreement are true and correct as if made at and as of such
Closing Date, and that such Selling Stockholder has complied with all the
agreements and satisfied all the conditions on such Selling Stockholder's part
to be performed or satisfied at or prior to such Closing Date.
(j) The Company shall have furnished to you and counsel for the
Underwriters such additional documents, certificates and evidence as you or they
may have reasonably requested.
(k) The Securities shall have been duly authorized for listing on the
NASDAQ National Market System, subject to notice of issuance.
All such opinions, certificates, letters and other documents will be
in compliance with the provisions hereof only if they are satisfactory in form
and substance to you and counsel for the Underwriters. The Company will furnish
you with such conformed copies of such opinions, certificates, letters and other
documents as you shall reasonably request.
6. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company agrees to 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 (including in settlement of any litigation if such settlement is
effected with the written consent of the Company), insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon an untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement, including the information deemed
to be a part of the Registration Statement at the time of effectiveness pursuant
to Rules 430A and 434(d) of the Rules and Regulations, if applicable, any
Preliminary Prospectus, the Prospectus, or any amendment or supplement thereto
(including any term sheet within the meaning of Rule 434 of the Rules and
Regulations), 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 it in connection with
investigating or defending against such loss, claim, damage, liability or
action; provided, however, that the Company shall not be liable in any such case
to the extent that any such loss, claim, damage, liability or action arises out
of or is based upon an untrue statement or alleged untrue statement or omission
or alleged omission made in the Registration Statement, any Preliminary
Prospectus, the Prospectus, or any such amendment or supplement, in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter specifically for use in the preparation thereof.
In addition to its other obligations under this Section 6(a), the
Company agrees that, as an interim measure during the pendency of any claim,
action, investigation, inquiry or other proceeding arising out of or based upon
any statement or omission, or any alleged statement or omission, described in
this Section 6(a), the Company will reimburse each Underwriter on a monthly
basis for all reasonable legal fees or other expenses incurred in connection
with investigating or defending any such claim, action, investigation, inquiry
or other proceeding, notwithstanding the absence of a judicial determination as
to the propriety and enforceability of the Company's and/or any Selling
Stockholder's obligation to reimburse the Underwriters for such expenses and the
possibility that such payments might later be held to have been improper by a
court of competent jurisdiction. To the extent that any such interim
reimbursement payment is so held to have been improper, the Underwriter that
received such payment shall promptly return it to the Company, together with
interest, compounded daily, determined on the basis of the prime rate (or other
-24-
commercial lending rate for borrowers of the highest credit standing) announced
from time to time by Bank of America N.A. (the "Prime Rate"). Any such interim
reimbursement payments which are not made to an Underwriter within 30 days of a
request for reimbursement shall bear interest at the Prime Rate from the date of
such request.
(b) Each Selling Stockholder, severally and not jointly, agrees to
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 (including in settlement of any litigation if such
settlement is effected with the written consent of such Selling Stockholder),
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement, including
the information deemed to be a part of the Registration Statement at the time of
effectiveness pursuant to Rules 430A and 434(d) of the Rules and Regulations, if
applicable, any Preliminary Prospectus, the Prospectus, or any amendment or
supplement thereto (including any term sheet within the meaning of Rule 434 of
the Rules and Regulations), 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 it in
connection with investigating or defending against such loss, claim, damage,
liability or action; provided, however, that no Selling Stockholder shall be
liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in the
Registration Statement, any Preliminary Prospectus, the Prospectus, or any such
amendment or supplement, in reliance upon and in conformity with written
information furnished to the Company by any Underwriter specifically for use in
the preparation thereof; and provided, further, that each Selling Stockholder
shall be obligated to indemnify the Underwriters under this Section 6(b) only if
such loss, claim, damage, liability or action arises out of or is based upon an
untrue statement or alleged untrue statement of a material fact contained in the
disclosure with respect to such Selling Stockholder in the section of the
Prospectus entitled "Principal and Selling Stockholders" or an omission or
alleged omission to state in such section of the Prospectus a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading regarding
such Selling Stockholder; and provided, further, that in no event shall any
Selling Stockholder be liable under the provisions of this Section 6 for any
amount in excess of the aggregate amount of proceeds such Selling Stockholder
received from the sale of the Securities pursuant to this Agreement.
(c) Each Underwriter will indemnify and hold harmless the Company and
each Selling Stockholder against any losses, claims, damages or liabilities to
which the Company and the Selling Stockholders may become subject, under the Act
or otherwise (including in settlement of any litigation, if such settlement is
effected with the written consent of such Underwriter), insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon an untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement, any Preliminary Prospectus, the
Prospectus, or any amendment or supplement thereto (including any term sheet
within the meaning of Rule 434 of the Rules and Regulations), or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in the Registration Statement, any Preliminary Prospectus, the Prospectus, or
any such amendment or supplement, in reliance upon and in conformity with
written information furnished to the Company by such Underwriter specifically
for use in the preparation thereof, and will reimburse the Company and the
Selling Stockholders
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for any legal or other expenses reasonably incurred by the Company or any such
Selling Stockholder in connection with investigating or defending against any
such loss, claim, damage, liability or action.
(d) Promptly after receipt by an indemnified party under subsection
(a), (b) or (c) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve the indemnifying party from any liability
that it may have to any indemnified party. In case any such action shall be
brought against any indemnified party, and it shall notify the indemnifying
party of the commencement thereof, the indemnifying party shall be entitled to
participate in, and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party, and after notice from the
indemnifying party to such indemnified party of the indemnifying party's
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation; provided, however,
that if, in the sole judgment of the Underwriters, it is advisable for the
Underwriters to be represented as a group by separate counsel, the Underwriters
shall have the right to employ a single counsel to represent the Underwriters
and all Underwriters who may be subject to liability arising from any claim in
respect of which indemnity may be sought by the Underwriters under subsection
(a) or (b) of this Section 6, in which event the reasonable fees and expenses of
such separate counsel shall be borne by the indemnifying party or parties and
reimbursed to the Underwriters as incurred (in accordance with the provisions of
the second paragraph in subsection (a) above). An indemnifying party shall not
be obligated under any settlement agreement relating to any action under this
Section 6 to which it has not agreed in writing.
(e) If the indemnification provided for in this Section 6 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
Stockholders on the one hand and the 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 the Selling
Stockholders on the one hand and the Underwriters on the other in connection
with the statements or omissions that resulted in such losses, claims,
damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the
Selling Stockholders on the one hand and the Underwriters on the other shall
be deemed to be in the same proportion as the total net proceeds from the
offering (before deducting expenses) received by the Company and Selling
Stockholders bear to the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in the table on the
cover page of the Prospectus. The relative fault shall be determined by
reference to, among other things, whether the untrue 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
Stockholders or the Underwriters and the parties' relevant intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The Company, the Selling Stockholders and the
Underwriters agree that it would not be just and equitable if contributions
pursuant to this subsection (e) were to be determined by pro rata allocation
(even if the Underwriters were treated as one entity for such purpose) or by
any other method of allocation which does not take account of the equitable
considerations referred to in the first sentence of this subsection (e). The
amount paid by an indemnified party as a result of the losses, claims,
damages or liabilities referred to in the first sentence of
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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 against 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 Underwriting discount received by such Underwriter
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 Stockholders under
this Section 6 shall be in addition to any liability which 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 6
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 (including any person who, with his consent, is named in
the Registration Statement as about to become a 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 or any Selling Stockholder within
the meaning of the Act.
7. REPRESENTATIONS AND AGREEMENTS TO SURVIVE DELIVERY. All
representations, warranties, and agreements of the Company and the Selling
Stockholders herein or in certificates delivered pursuant hereto, and the
agreements of the Underwriters, the Company and the Selling Stockholders
contained in Section 6 hereof, shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of any Underwriter
or any controlling person thereof, and shall survive delivery of, and payment
for, the Securities to and by the Underwriters hereunder.
8. SUBSTITUTION OF UNDERWRITERS.
(a) If any Underwriter or Underwriters shall fail to take up and pay
for the amount of Firm Shares agreed by such Underwriter or Underwriters to be
purchased hereunder, upon tender of such Firm Shares in accordance with the
terms hereof, and the amount of Firm Shares not purchased does not aggregate
more than 10% of the total amount of Firm Shares set forth in Schedule II
hereto, the remaining Underwriters shall be obligated to take up and pay for (in
proportion to their respective underwriting obligations hereunder as set forth
in Schedule II hereto except as may otherwise be determined by you) the Firm
Shares that the withdrawing or defaulting Underwriters agreed but failed to
purchase.
(b) If any Underwriter or Underwriters shall fail to take up and pay
for the amount of Firm Shares agreed by such Underwriter or Underwriters to be
purchased hereunder, upon tender of such Firm Shares in accordance with the
terms hereof, and the amount of Firm Shares not purchased aggregates more than
10% of the total amount of Firm Shares set forth in Schedule II hereto, and
arrangements satisfactory to you for the purchase of such Firm Shares by other
persons are not made within 36 hours thereafter, this Agreement shall terminate.
In the event of any such termination neither the Company nor any Selling
Stockholder shall be under any liability to any Underwriter (except to the
extent provided in Section 4(a)(vii), Section 4(b)(ii) and Section 6 hereof) nor
shall any Underwriter (other than an Underwriter who shall have failed,
otherwise than for some reason permitted under this Agreement, to purchase the
amount of Firm Shares agreed by such Underwriter to be purchased hereunder) be
under any liability to the Company or the Selling Stockholders (except to the
extent provided in Section 6 hereof).
-27-
If Firm Shares to which a default relates are to be purchased by the
non-defaulting Underwriters or by any other party or parties, the Underwriters
or the Company shall have the right to postpone the First Closing Date for not
more than seven business days in order that the necessary changes in the
Registration Statement, Prospectus and any other documents, as well as any other
arrangements, may be effected. As used herein, the term "Underwriter" includes
any person substituted for an Underwriter under this Section 8.
9. EFFECTIVE DATE OF THIS AGREEMENT AND TERMINATION.
(a) This Agreement shall become effective at 10:00 a.m., Central
time, on the first full business day following the effective date of the
Registration Statement, or at such earlier time after the effective time of the
Registration Statement as you in your discretion shall first release the
Securities for sale to the public; provided, that if the Registration Statement
is effective at the time this Agreement is executed, this Agreement shall become
effective at such time as you in your discretion shall first release the
Securities for sale to the public. For the purpose of this Section, the
Securities shall be deemed to have been released for sale to the public upon
release by you of the publication of a newspaper advertisement relating thereto
or upon release by you of telexes offering the Securities for sale to securities
dealers, whichever shall first occur. By giving notice as hereinafter specified
before the time this Agreement becomes effective, the Underwriters or the
Company may prevent this Agreement from becoming effective without liability of
any party to any other party, except that the provisions of Section 4(a)(vii),
Section 4(b)(ii) and Section 6 hereof shall at all times be effective.
(b) The Underwriters shall have the right to terminate this Agreement
by giving notice as hereinafter specified at any time at or prior to the First
Closing Date, and the option referred to in Section 3(b), if exercised, may be
cancelled at any time prior to the Second Closing Date, if (i) the Company shall
have failed, refused or been unable, at or prior to such Closing Date, to
perform any agreement on its part to be performed hereunder, (ii) any other
condition of the Underwriters' obligations hereunder is not fulfilled,
(iii) trading on the Nasdaq Stock Market, the New York Stock Exchange or the
American Stock Exchange shall have been suspended or limited, (iv) minimum or
maximum prices for trading shall have been fixed, or maximum ranges for prices
for securities shall have been required, on the Nasdaq Stock Market, the New
York Stock Exchange or the American Stock Exchange, by such exchange or by order
of the Commission or any other governmental authority having jurisdiction, (v) a
banking moratorium shall have been declared by Federal, New York, Missouri or
Kansas authorities, or (vi) there has occurred any material adverse change in
the financial markets in the United States or an outbreak of major hostilities
(or an escalation thereof) in which the United States is involved, a declaration
of war by Congress, any other substantial national or international calamity or
any other event or occurrence of a similar character shall have occurred since
the execution of this Agreement that, in your judgment, makes it impractical or
inadvisable to proceed with the completion of the sale of and payment for the
Securities. Any such termination shall be without liability of any party to any
other party except that the provisions of Section 4(a)(vii), Section 4(b)(ii)
and Section 6 hereof shall at all times be effective.
(c) If you elect to prevent this Agreement from becoming effective or
to terminate this Agreement as provided in this Section, the Company and an
Attorney-in-Fact, on behalf of the Selling Stockholders, shall be notified
promptly by you by telephone or telegram, confirmed by letter. If the Company
elects to prevent this Agreement from becoming effective, you and an
Attorney-in-Fact, on behalf of the Selling Stockholders, shall be notified by
the Company by telephone or telegram, confirmed by letter.
-28-
10. DEFAULT BY ONE OR MORE OF THE SELLING STOCKHOLDERS OR THE COMPANY. If
one or more of the Selling Stockholders shall fail at the First Closing Date to
sell and deliver the number of Securities which such Selling Stockholder or
Selling Stockholders are obligated to sell hereunder, and the remaining Selling
Stockholders do not exercise the right hereby granted to increase, pro rata or
otherwise, the number of Securities to be sold by them hereunder to the total
number of Securities to be sold by all Selling Stockholders as set forth in
Schedule I, then the Underwriters may, by notice to the Company and the
non-defaulting Selling Stockholders, either (a) terminate this Agreement without
any liability on the part of any non-defaulting party or (b) elect to purchase
the Securities which the Company and the non-defaulting Selling Stockholders
have agreed to sell hereunder.
In the event of a default by any Selling Stockholder as referred to in
this Section, either you or the Company or, by joint action only, the
non-defaulting Selling Stockholders shall have the right to postpone the First
Closing Date for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or Prospectus or in any other
documents or arrangements.
If the Company shall fail at the First Closing Date to sell and
deliver the number of Securities which it is obligated to sell hereunder, then
this Agreement shall terminate without any liability on the part of any
non-defaulting party.
No action taken pursuant to this Section shall relieve the Company or
any Selling Stockholders so defaulting from liability, if any, in respect of
such default.
11. INFORMATION FURNISHED BY UNDERWRITERS. The statements set forth in
the last paragraph of the cover page, the last paragraph of the inside cover
page and under the caption "Underwriting" in any Preliminary Prospectus and in
the Prospectus constitute the written information furnished by or on behalf of
the Underwriters referred to in Section 2 and Section 6 hereof.
12. NOTICES. Except as otherwise provided herein, all communications
hereunder shall be in writing or by confirmed telecopy and, if to the
Underwriters, shall be mailed, telecopied or delivered to the Underwriters, c/o
Xxxxx Xxxxxxx Inc., Xxxxx Xxxxxxx Tower, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxxxx,
Xxxxxxxxx 00000, Attention: Xxxxxxxx X. Xxxxxx; except that notices given to an
Underwriter pursuant to Section 6 hereof shall be sent, in the case of Xxxxx
Xxxxxxx Inc., to the foregoing address, and in the case of Xxxxxx, Read & Co.
Inc., to Xxxxxx, Read & Co. Inc., 000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxx; if to the Company,
shall be mailed, telecopied or delivered to it at 0000 Xxxxxxx Xxxxxxx Xxxxxxx,
Xxxxxxx Xxxxx, XX 00000, Attention: Xxxx X. Xxxxxx; if to any of the Selling
Stockholders, at the address of the Attorneys-in-Fact as set forth in the Powers
of Attorney, or in each case to such other address as the person to be notified
may have requested in writing. Any party to this Agreement may change such
address for notices by sending to the parties to this Agreement written notice
of a new address for such purpose.
13. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective
successors and assigns and the controlling persons, officers and directors
referred to in Section 6. Nothing in this Agreement is intended or shall be
construed to give to any other person, firm or corporation any legal or
equitable remedy or claim under or in respect of this Agreement or any provision
herein contained. The term "successors and assigns" as herein used shall not
include any purchaser, as such purchaser, of any of the Securities from any of
the Underwriters.
-29-
14. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Minnesota.
[Signature Page Follows]
-30-
Please sign and return to the Company the enclosed duplicates of this
letter whereupon this letter will become a binding agreement between the
Company, the Selling Stockholders and the Underwriters in accordance with its
terms.
Very truly yours,
XXXXX XXXXXXXXXXX COMPANY
By
---------------------------------------------------
Chief Executive Officer
SELLING STOCKHOLDERS
By
---------------------------------------------------
Attorney-in-Fact
MARLEY ASSOCIATES
By
---------------------------------------------------
MARLEY PARTNERS, L.P.
By
--------------------------------------------------
KKR PARTNERS
By
--------------------------------------------------
GREYLOCK INVESTMENTS LIMITED PARTNERSHIP
By
--------------------------------------------------
XXXXXX X. XXXXXX
By
--------------------------------------------------
PAINEWEBBER INC., AS TRUSTEE FBO XXXXXX X. XXXXXX
By
--------------------------------------------------
XXXXXXX ST. X. XXXXXX
By
--------------------------------------------------
XXXXXXXX X. XXXXXX
By
--------------------------------------------------
Confirmed as of the date first
above mentioned.
XXXXX XXXXXXX INC.
By
---------------------------
Managing Director
XXXXXX, READ & CO. INC.
By
---------------------------
Managing Director
SCHEDULE I
Selling Stockholders
Number of
Firm Shares
Name to be Sold
---- ----------
Marley Associates 1,265,596
Marley Partners, L.P. 378,989
KKR Partners 219,351
Greylock Investments Limited Partnership 399,818
Xxxxxx X. Xxxxxx 57,636
PaineWebber Inc., as Trustee FBO Xxxxxx X. Xxxxxx 51,780
Xxxxxxx St.X. Xxxxxx 1,541
Xxxxxxxx X. Xxxxxx 1,541
Baupost Limited Partnership 1983 A-1 18,552
Baupost Limited Partnership 1983 B-1 9,718
Baupost Limited Partnership 1983 C-1 60,074
Chesterfield Investments 216,412
Xxxxxxx X. Xxxx 6,535
Dockash Corporation 55,479
Xxxxx X. Xxxxx 14,794
Xxxxx Xxxxxxx & Co. as Trustee Xxxxxxx X. Irrevocable Trust 4,093
Xxxxx Xxxxxxx & Co. as Trustee Xxxxxxx X. Irrevocable Trust 4,093
Xxxxx Xxxxxxx & Co. as Trustee Xxxxxxx X. Irrevocable Trust 4,093
Xxxxxxxxx X. Xxxxxx as Trustee of the Irrevocable Trust
Dated 9/24/90 FBO Xxxxxxxxx X. Xxxxxx 4,206
Xxxxxxx X. Xxxxxx as Trustee of the Irrevocable Trust
Dated 9/24/90 FBO Xxxxxxx X. Xxxxxx 4,878
Xxxxx X. Xxxxxx 7,521
Xxxxx X. Xxxxxx Irrevocable Charitable Remainder Trust 11,000
Xxxxx Xxxxxxx 11,000
Industrial Manufacturers & Systems S.A. 77,054
Xxxx X. Xxxxxxxxx 7,397
Xxxxx X. Xxxxxx 1,000
Xxxx X. Xxxxxx 2,500
Xxxxx X. Xxxxxx 2,200
Xxx X. Xxxx 34,810
Xxxxxx X. Xxxxxx 59,774
-------
Total. . . . . . . . . . . . . . . . . . . . . . . . . . . 2,993,435
----------
----------
SCHEDULE II
Underwriter Number of Firm Shares (1)
Xxxxx Xxxxxxx Inc.
Xxxxxx, Read & Co. Inc.
-------
Total. . . . . . . . . . . . . . 5,000,000
---------
---------
-----------------
(1) The Underwriters may purchase up to an additional 750,000 Option Shares, to
the extent the option described in Section 3(b) of the Agreement is
exercised, in the proportions and in the manner described in the Agreement.
SCHEDULE III
Name of Subsidiary
------------------
Xxxxxxxxxxx Xxxxxx Corporation*
Xxxxxx Bros. Drilling Company*
Xxxxx GeoSciences, Inc.
Elgin Exploration Company, Ltd*.
Xxxxxxx Mining Services Limited*
Glindemann & Kitching Pty Ltd.
Xxxxx Xxxxxxxxxxx Australia Pty Limited*
Xxxxx de Mexico, S.A. de X.X.
Xxxxx (Thailand) Limited
----------------------
* Each Subsidiary identified by an asterisk shall be considered a
Scheduled Entity for purposes of Section 5(d).
SCHEDULE IV
Name of Foreign Affiliate
-------------------------
Xxxxxxxxxxx Chile, S.A.
Geotec Xxxxxx Bros., X.X.
Xxxxxx Bros. Xxxxxxxxxx, S.A.
Geotec, S.A.
Boytec, S.A.
SCHEDULE V
Name of Subsidiary or Affiliate Jurisdiction of Organization Percentage of Ownership
------------------------------- ---------------------------- ------------------------
