EXHIBIT 1.1
4,000,000 Shares
XXXXXX XXXXXX VISIONCARE, INC.
Common Stock
($.01 Par Value)
UNDERWRITING AGREEMENT
----------------------
August __, 1997
Alex. Xxxxx & Sons Incorporated
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Bear, Xxxxxxx & Co. Inc.
Salomon Brothers Inc
As Representatives of the Several Underwriters
c/o Alex. Xxxxx & Sons Incorporated
Xxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
Xxxxxx Xxxxxx VisionCare, Inc., a Delaware corporation (the "Company"),
Xxxxxx Xxxxxx Corporation, a Delaware corporation, (the "Principal Operating
Subsidiary" and together with each subsidiary of the Company, collectively, the
"Subsidiaries") and certain stockholders of the Company listed on Schedule IV
hereto (the "Selling Shareholders" and, together with the Company, collectively,
the "Sellers"), confirm their respective agreements with Alex. Xxxxx & Sons
Incorporated ("Alex. Xxxxx") and each of the other underwriters named in
Schedule I hereto (collectively, the "Underwriters," which term shall also
include any underwriter substituted as hereinafter provided in Section 9
hereof), for whom Alex. Xxxxx, Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated, Bear, Xxxxxxx & Co. Inc. and Salomon Brothers Inc
are acting as representatives (in such capacity, the "Representatives"), with
respect to the issue and sale by the Company and the sale by the Selling
Shareholders and the purchase by the Underwriters, acting severally and not
jointly, of the respective numbers of shares of Common Stock, par value $.01 per
share, of the Company ("Common Stock") set forth in said Schedule I hereto (the
"Firm Shares"), and with respect to the grant by the Selling Shareholders to the
Underwriters, acting severally and not jointly, of the option described in
Section 2(c) hereof to
purchase all or any part of 600,000 additional shares of Common Stock to cover
over-allotments, if any, as set forth in Schedule II hereto (the "Option
Shares"). The Firm Shares and the Option Shares (to the extent the
aforementioned option is exercised) are herein collectively called the "Shares."
Any capitalized term used but not otherwise defined herein is used herein with
the meaning ascribed to such term in the Registration Statement.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-32493) covering the
registration of the Shares under the Securities Act of 1933, as amended (the
"1933 Act"), including the related preliminary prospectus or prospectuses.
Promptly after execution and delivery of this Agreement, the Company will either
(i) prepare and file a prospectus in accordance with the provisions of Rule 430A
("Rule 430A") of the rules and regulations of the Commission under the 1933 Act
(the "1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule 424(b)") of
the 1933 Act Regulations or (ii) if the Company has elected to rely upon Rule
434 ("Rule 434") of the 1933 Act Regulations, prepare and file a term sheet (a
"Term Sheet") in accordance with the provisions of Rule 434 and Rule 424(b).
The information included in such prospectus or in such Term Sheet, as the case
may be, that was omitted from such registration statement at the time it became
effective but that is deemed to be part of such registration statement at the
time it became effective (a) pursuant to paragraph (b) of Rule 430A is referred
to as "Rule 430A Information" or (b) pursuant to paragraph (d) of Rule 434 is
referred to as "Rule 434 Information." Each prospectus used before such
registration statement became effective, and any prospectus that omitted, as
applicable, the Rule 430A Information or the Rule 434 Information, that was used
after such effectiveness and prior to the execution and delivery of this
Agreement, is herein called a "preliminary prospectus." Such registration
statement, including the exhibits thereto and schedules thereto at the time it
became effective and including the Rule 430A Information and the Rule 434
Information, as applicable, is herein called the "Registration Statement." Any
registration statement filed pursuant to Rule 462(b) of the 1933 Act Regulations
is herein referred to as the "Rule 462(b) Registration Statement," and after
such filing the term "Registration Statement" shall include the Rule 462(b)
Registration Statement. The final prospectus in the form first furnished to the
Underwriters for use in connection with the offering of the Shares is herein
called the "Prospectus." If Rule 434 is relied on, the term "Prospectus" shall
refer to the preliminary prospectus dated July 31, 1997 together with the Term
Sheet and all references in this Agreement to the date of the Prospectus shall
mean the date of the Term Sheet. For purposes of this Agreement, all references
to the Registration Statement, any preliminary prospectus, the Prospectus or any
Term Sheet or any amendment or supplement to any of the foregoing shall be
deemed to include the copy filed with the Commission pursuant to its Electronic
Data Gathering, Analysis and Retrieval system ("XXXXX").
As the Representatives, you have advised the Company and the Selling
Shareholders (a) that you are authorized to enter into this Agreement on behalf
of the several Underwriters, and (b) that the several Underwriters are willing,
acting severally and not jointly, to purchase the numbers of Firm Shares set
forth opposite their respective names in Schedule I hereto, plus their pro rata
portion of the Option Shares if you elect to exercise the over-allotment option
in whole or in part for the accounts of the several Underwriters.
-2-
In consideration of the mutual agreements contained herein and of the
interests of the parties in the transactions contemplated hereby, the parties
hereto agree as follows:
1. Representations and Warranties.
(a) Representations and Warranties of the Company and the Principal
Operating Subsidiary. The Company and the Principal Operating Subsidiary
each jointly and severally represent and warrant to each Underwriter as of
the date hereof, as of the Closing Date referred to in Section 2(b) hereof,
and as of each Option Closing Date (if any) referred to in Section 2(c)
hereof, and agrees with each Underwriter, as follows:
(i) Compliance with Registration Requirements. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b) Registration
Statement has been issued under the 1933 Act and no proceedings for that
purpose have been instituted or are pending or, to the knowledge of the
Company, are contemplated by the Commission, and any request on the part of
the Commission for additional information has been complied with. The
Registration Statement, the Rule 462(b) Registration Statement and any
amendments and supplements thereto complies in all material respects with
the requirements of the 1933 Act and the 1933 Act Regulations and does 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 not misleading. Neither the Prospectus nor any amendments or
supplements thereto (including any prospectus wrapper), includes an untrue
statement of a material fact or omits to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. If Rule 434 is used, the
Company will comply with the requirements of Rule 434 and the Prospectus
shall not be "materially different", as such term is used in Rule 434, from
the prospectus included in the Registration Statement at the time it became
effective. The representations and warranties in this subsection shall not
apply to statements in or omissions from the Registration Statement,
Prospectus or preliminary prospectus made in reliance upon and in
conformity with information furnished to the Company in writing by any
Underwriter through Alex. Xxxxx expressly for use in the Registration
Statement, Prospectus or preliminary prospectus.
Each preliminary prospectus and the prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied when so
filed in all material respects with the 1933 Act Regulations and each
preliminary prospectus and the Prospectus delivered to the Underwriters for
use in connection with this offering was identical to the electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX,
except to the extent permitted by Regulation S-T.
-3-
(ii) Independent Accountants. The accountants who certified the
financial statements and supporting schedules included in the Registration
Statement are independent public accountants as required by the 1933 Act
and the 1933 Act Regulations.
(iii) Financial Statements. The financial statements included in the
Registration Statement and the Prospectus, together with the related
schedules and notes, present fairly the financial position of the Company,
its consolidated subsidiaries, its Predecessor (as defined in the
Registration Statement) and, to the best of the Company's knowledge,
Xxxxxx-Xxxx (as defined in the Registration Statement) at the dates
indicated and the statement of operations, stockholders' equity and cash
flows of the Company, its consolidated subsidiaries, its Predecessor and
Xxxxxx-Xxxx for the periods specified; said financial statements have been
prepared in conformity with generally accepted accounting principles
("GAAP") applied on a consistent basis throughout the periods involved.
The supporting schedules included in the Registration Statement present
fairly in accordance with GAAP the information required to be stated
therein. The selected financial data and the summary financial information
included in the Prospectus present fairly the information shown therein and
have been compiled on a basis consistent with that of the audited financial
statements included in the Registration Statement. The pro forma financial
statements and the related notes thereto included in the Registration
Statement and the Prospectus present fairly the information shown therein,
have been prepared in accordance with the Commission's rules and guidelines
with respect to pro forma financial statements and have been properly
compiled on the bases 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 and circumstances referred
to therein.
(iv) No Material Adverse Change in Business. Since the respective
dates as of which information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein, (A) there has been no
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
Subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business (a "Material Adverse Effect"), (B) there have
been no transactions entered into by the Company or any of its
Subsidiaries, other than those in the ordinary course of business, which
are material with respect to the Company and its Subsidiaries considered as
one enterprise, and (C) since June 28, 1995 there has been no dividend or
distribution of any kind declared, paid or made by the Company on any class
of its capital stock.
(v) Good Standing of the Company and the Principal Operating
Subsidiary. Each of the Company and the Principal Operating Subsidiary has
been duly organized and is validly existing as a corporation in good
standing under the laws of the State of Delaware and each has corporate
power and authority to own, lease and operate its properties and to conduct
its business as described in the Prospectus and to enter into and perform
its obligations under this Agreement; and each of the Company and the
Principal Operating Subsidiary is duly qualified as a foreign corporation
to transact business and is
-4-
in good standing in each other jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in
good standing would not reasonably be expected to result in a Material
Adverse Effect.
(vi) Good Standing of Subsidiaries. Each Subsidiary of the Company
has been duly organized and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation, has
corporate power and authority to own, lease and operate its properties and
to conduct its business as described in the Prospectus and is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct of
business, except where the failure so to qualify or to be in good standing
would not reasonably be expected to result in a Material Adverse Effect;
except as otherwise disclosed in the Registration Statement, all of the
issued and outstanding capital stock of each such Subsidiary has been duly
authorized and validly issued, is fully paid and non-assessable and is
owned by the Company, directly or through Subsidiaries, free and clear of
any security interest, mortgage, pledge, lien, encumbrance, claim or
equity; none of the outstanding shares of capital stock of any Subsidiary
was issued in violation of the preemptive or similar rights of any
securityholder of such Subsidiary. The only Subsidiaries of the Company
are the Subsidiaries listed on Exhibit 21.1 to the Registration Statement.
(vii) Capitalization. The authorized, issued and outstanding capital
stock of the Company is as set forth in the Prospectus in the column
entitled "Actual" under the caption "Capitalization" (except for subsequent
issuances, if any, pursuant to this Agreement or pursuant to reservations,
agreements or employee benefit plans referred to in the Prospectus). The
shares of issued and outstanding capital stock of the Company have been
duly authorized and validly issued and are fully paid and non-assessable;
none of the outstanding shares of capital stock of the Company was issued
in violation of the preemptive or other similar rights of any
securityholder of the Company.
(viii) Authorization of Agreement. This Agreement has been duly
authorized, executed and delivered by the Company and the Principal
Operating Subsidiary.
(ix) Authorization and Description of Shares. The Shares have been
duly authorized for issuance and sale to the Underwriters pursuant to this
Agreement and, when issued and delivered by the Company pursuant to this
Agreement against payment of the consideration set forth herein, will be
validly issued, fully paid and non-assessable; the Common Stock conforms in
all material respects to all statements relating thereto contained in the
Prospectus and such description conforms in all material respects to the
rights set forth in the instruments defining the same; no holder of the
Shares will be subject to personal liability by reason of being such a
holder; and the issuance of the Shares is not subject to the preemptive or
other similar rights of any securityholder of the Company.
-5-
(x) Absence of Defaults and Conflicts. Neither the Company nor any of
its Subsidiaries is in violation of its charter or by-laws or in default in
the performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, lease or other agreement or instrument to
which the Company or any of its Subsidiaries is a party or by which it or
any of them may be bound, or to which any of the property or assets of the
Company or any Subsidiary is subject (collectively, "Agreements and
Instruments") except for such defaults that would not reasonably be
expected to result in a Material Adverse Effect; and the execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated herein and in the Registration Statement
(including the issuance and sale of the Shares and the use of the proceeds
from the sale of the Shares as described in the Prospectus under the
caption "Use of Proceeds", the execution of the Amended Bank Agreement as
described in the Prospectus under the caption "Bank Credit Agreement" (the
"Bank Credit Agreement") and compliance by the Company and the Principal
Operating Subsidiary with its obligations hereunder have been duly
authorized by all necessary corporate action and do not and will not,
whether with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or Repayment Event (as
defined below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
Subsidiary pursuant to, the Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not reasonably be expected to result in a Material Adverse Effect) or
under any employee benefit plan of the Company, nor will such action result
in any material violation of the provisions of the charter or by-laws of
the Company or any Subsidiary or any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over the
Company or any Subsidiary or any of their assets, properties or operations.
As used herein, a "Repayment Event" means any event or condition which
gives the holder of any note, debenture or other evidence of indebtedness
(or any person acting on such holder's behalf) the right to require the
repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any Subsidiary.
(xi) Compliance with Laws. The Company and each of the Subsidiaries
are conducting their business in compliance with all the local, state,
federal and foreign laws, rules and regulations of the jurisdictions in
which each of the Company and the Subsidiaries is conducting business,
including, without limitation, those of the United States Food and Drug
Administration and the Federal Trade Commission, except where failure to be
so in compliance, singly or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect on the business or financial
condition of the Company or any of its Subsidiaries.
(xii) Absence of Labor Dispute. No labor dispute with the employees
of the Company or any Subsidiary exists or, to the knowledge of the Company
or the Principal Operating Subsidiary, is imminent, and neither the Company
nor the Principal Operating Subsidiary is aware of any existing or imminent
labor disturbance by the employees of any
-6-
of its or any Subsidiary's principal suppliers, manufacturers, customers or
contractors, which, in either case, may reasonably be expected to result in
a Material Adverse Effect.
(xiii) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge of
the Company or the Principal Operating Subsidiary, threatened, against or
affecting the Company or any Subsidiary, which is required to be disclosed
in the Registration Statement (other than as disclosed therein), or which
might reasonably be expected to result in a Material Adverse Effect, or
which might reasonably be expected to materially and adversely affect the
properties or assets thereof or the consummation of the transactions
contemplated in this Agreement or by the Bank Credit Agreement or the
performance by the Company or the Principal Operating Subsidiary of its
obligations hereunder; the aggregate of all pending legal or governmental
proceedings to which the Company or any Subsidiary is a party or of which
any of their respective property or assets is the subject which are not
described in the Registration Statement, including ordinary routine
litigation incidental to the business, would not reasonably be expected to
result in a Material Adverse Effect.
(xiv) Accuracy of Exhibits. There are no contracts or documents
which are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits thereto which have not been so
described and filed as required.
(xv) Possession of Intellectual Property. The Company and its
Subsidiaries own or possess, or can acquire on reasonable terms, adequate
patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures),
trademarks, service marks, trade names or other intellectual property,
including specifically but without limitation the patents listed on
Schedule V hereto, (collectively, "Intellectual Property") necessary to
carry on the business now operated by them, and neither the Company nor any
of its Subsidiaries has received any notice or is otherwise aware of any
infringement of or conflict with asserted rights of others with respect to
any Intellectual Property or of any facts or circumstances which would
render any Intellectual Property invalid or inadequate to protect the
interest of the Company or any of its Subsidiaries therein, and which
infringement or conflict (if the subject of any unfavorable decision,
ruling or finding) or invalidity or inadequacy, singly or in the aggregate,
would reasonably be expected to result in a Material Adverse Effect.
(xvi) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by each of the Company and the
Principal Operating Subsidiary of its obligations hereunder, in connection
with the offering, issuance or sale of the Shares hereunder or the
consummation of the transactions contemplated by this Agreement or by the
Bank Credit Agreement, except such as have been already obtained or as may
be required under the 1933 Act or the 1933 Act Regulations or state
securities laws.
-7-
(xvii) Possession of Licenses and Permits. The Company and its
Subsidiaries possess such permits, licenses, approvals, consents and other
authorizations (collectively, "Governmental Licenses") issued by the
appropriate federal, state, local or foreign regulatory agencies or bodies
necessary to conduct the business now operated by them; the Company and its
Subsidiaries are in compliance with the terms and conditions of all such
Governmental Licenses, except where the failure so to comply would not,
singly or in the aggregate, have a Material Adverse Effect; all of the
Governmental Licenses are valid and in full force and effect, except when
the invalidity of such Governmental Licenses or the failure of such
Governmental Licenses to be in full force and effect would not reasonably
be expected to have a Material Adverse Effect; and neither the Company nor
any of its Subsidiaries has received any notice of proceedings relating to
the revocation or modification of any such Governmental Licenses which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would reasonably be expected to result in a Material
Adverse Effect.
(xviii) Title to Property. The Company and its Subsidiaries have
good and marketable title to all real property owned by the Company and its
Subsidiaries and good title to all other properties owned by them, in each
case, free and clear of all mortgages, pledges, liens, security interests,
claims, restrictions or encumbrances of any kind except such as (A) are
described in the Prospectus, or (B) do not, singly or in the aggregate,
materially affect the value of such property and do not interfere with the
use made or proposed to be made of such property by the Company or any of
its Subsidiaries; and all of the leases and subleases material to the
business of the Company and its Subsidiaries, considered as one enterprise,
and under which the Company or any of its Subsidiaries holds properties
described in the Prospectus, are in full force and effect, and neither the
Company nor any Subsidiary has any notice of any material claim of any sort
that has been asserted by anyone adverse to the rights of the Company or
any Subsidiary under any of the leases or subleases mentioned above, or
affecting or questioning the rights of the Company or such Subsidiary to
the continued possession of the leased or subleased premises under any such
lease or sublease.
(xix) Compliance with Cuba Act. The Company has complied with, and
is and will be in compliance with, the provisions of that certain Florida
act relating to disclosure of doing business with Cuba, codified as Section
517.075 of the Florida statutes, and the rules and regulations thereunder
(collectively, the "Cuba Act") or is exempt therefrom.
(xx) Investment Company Act. The Company is not, and upon the
issuance and sale of the Shares as herein contemplated and the application
of the net proceeds therefrom as described in the Prospectus will not be,
an "investment company" or, to the best of the Company's knowledge, an
entity "controlled" by an "investment company" as such terms are defined in
the Investment Company Act of 1940, as amended (the "1940 Act").
(xxi) Environmental Laws. Except as described in the Registration
Statement and except as would not, singly or in the aggregate, reasonably
be expected to result in a
-8-
Material Adverse Effect, (A) neither the Company nor any of its
Subsidiaries is in violation of any federal, state, local or foreign
statute, law, rule, regulation, ordinance, code, policy or rule of common
law or any judicial or administrative interpretation thereof, including any
judicial or administrative order, consent, decree or judgment, relating to
pollution or protection of human health, 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 the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, "Hazardous Materials") or to
the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials (collectively,
"Environmental Laws"), (B) the Company and its Subsidiaries have all
permits, authorizations and approvals required under any applicable
Environmental Laws and are each in material compliance with their
requirements, (C) there are no pending or threatened administrative,
regulatory or judicial actions, suits, demands, demand letters, claims,
liens, notices of noncompliance or violation, investigation or proceedings
relating to any Environmental Law against the Company or any of its
Subsidiaries and (D) there are no events or circumstances that might
reasonably be expected to form the basis of an order for clean-up or
remediation, or an action, suit or proceeding by any private party or
governmental body or agency, against or affecting the Company or any of its
Subsidiaries relating to Hazardous Materials or any Environmental Laws.
(xxii) Lock-Up Agreements. The Company has caused each person listed
on Schedule VI hereto to furnish to you, on or prior to the date of this
agreement, a letter or letters, substantially in the form of Exhibit 1
hereto (the "Lock-Up Agreement"), pursuant to which each such person shall
have agreed that during a period of 90 days from the date of the
Prospectus, such person will not, without the prior written consent of
Alex. Xxxxx, (i) directly or indirectly, offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or
contract to sell, grant any option, right or warrant to purchase or
otherwise transfer or dispose of any share of Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock
or file any registration statement under the 1933 Act with respect to any
of the foregoing or (ii) enter into any swap or any other agreement or any
transaction that transfers, in whole or in part, directly or indirectly,
the economic consequence of ownership of the Common Stock, whether any such
swap or transaction described in clause (i) or (ii) above is to be settled
by delivery of Common Stock or such other securities, in cash or otherwise.
The foregoing sentence shall not apply to the Shares to be sold hereunder.
(xxiii) Registration Rights. Other than as described in the
Prospectus under the heading "Registration Agreement", there are no persons
with registration rights or other similar rights to have any securities
registered pursuant to the Registration Statement or otherwise registered
by the Company under the 1933 Act.
(b) Representations and Warranties of the Selling Shareholders. Each
Selling Shareholder, severally and not jointly, represents and warrants to each
Underwriter as of
-9-
the date hereof, as of the Closing Date, and, if the Selling Shareholder is
selling Option Shares on an Option Closing Date, as of each such Option Closing
Date, and agrees with each Underwriter, as follows:
(i) Accurate Disclosure. The information furnished in writing by or
on behalf of such Selling Shareholder expressly for use in the Registration
Statement and any amendments and supplements thereto does 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 regarding
such Selling Shareholder therein not misleading, and the information
furnished in writing on behalf of such Selling Shareholder expressly for
use in the Prospectus does not include an untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements regarding such Selling Shareholder therein, in the light of the
circumstances under which they were made, not misleading.
(ii) Good and Marketable Title. Such Selling Shareholder has good and
marketable title to the Shares to be sold by such Selling Shareholder
hereunder, free and clear of any security interest, mortgage, pledge, lien,
charge, claim, equity or encumbrance of any kind, other than pursuant to
this Agreement; and upon delivery of such Shares and payment of the
purchase price therefor as herein contemplated, assuming each such
Underwriter has no notice of any adverse claim, each of the Underwriters
will receive good and marketable title to the Shares purchased by it from
such Selling Shareholder, free and clear of any security interest,
mortgage, pledge, lien, charge, claim, equity or encumbrance of any kind.
(iii) Authorization of Agreements. Each Selling Shareholder has the
full right, power and authority to enter into this Agreement and to sell,
transfer and deliver the Shares to be sold by such Selling Shareholder
hereunder. The execution and delivery of this Agreement and the sale and
delivery of the Shares to be sold by such Selling Shareholder and the
consummation of the transactions contemplated herein and compliance by such
Selling Shareholder with its obligations hereunder have been duly
authorized by such Selling Shareholder and do not and will not, whether
with or without the giving of notice or passage of time or both, conflict
with or constitute a breach of, or default under, or result in the creation
or imposition of any tax, lien, charge or encumbrance upon the Shares to be
sold by such Selling Shareholder or any property or assets of such Selling
Shareholder pursuant to any contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, license, lease or other agreement or
instrument to which such Selling Shareholder is a party or by which such
Selling Shareholder may be bound, or to which any of the property or assets
of such Selling Shareholder is subject, nor will such action result in any
violation of the provisions of the charter or by-laws or other
organizational instrument of such Selling Shareholder, if applicable, or
any applicable treaty, law, statute, rule, regulation, judgment, order,
writ or decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over such Selling Shareholder or
any of its properties.
-10-
(iv) Absence of Manipulation. Such Selling Shareholder has not taken,
and will not take, directly or indirectly, any action which is designed to
or which has constituted or which might reasonably be expected to cause or
result in stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Shares.
(v) Absence of Further Requirements. No filing with, or consent,
approval, authorization, order, registration, qualification or decree of,
any court or governmental authority or agency, domestic or foreign, is
necessary or required for the performance by each Selling Shareholder of
its obligations hereunder or in connection with the sale and delivery of
the Shares hereunder or the consummation of the transactions contemplated
by this Agreement, except such as may have previously been made or obtained
or as may be require under the 1933 Act or the 1933 Act Regulations or
state securities laws.
(vi) Lock-Up Agreements. Each Selling Shareholder has executed and
delivered to you, on or prior to the date of this agreement, a Lock-Up
Agreement, pursuant to which each such person shall have agreed that during
a period of 90 days from the date of the Prospectus, such person will not,
without the prior written consent of Alex. Xxxxx, (i) directly or
indirectly, offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase or otherwise transfer or dispose of
any share of Common Stock or any securities convertible into or exercisable
or exchangeable for Common Stock or file any registration statement under
the 1933 Act with respect to any of the foregoing or (ii) enter into any
swap or any other agreement or any transaction that transfers, in whole or
in part, directly or indirectly, the economic consequence of ownership of
the Common Stock, whether any such swap or transaction described in clause
(i) or (ii) above is to be settled by delivery of Common Stock or such
other securities, in cash or otherwise. The foregoing sentence shall not
apply to the Shares to be sold hereunder.
(vii) Certificates Suitable for Transfer. Certificates for all of
the Shares to be sold by such Selling Shareholder pursuant to this
Agreement, in suitable form for transfer by delivery or accompanied by duly
executed instruments of transfer or assignment in blank with signatures
guaranteed, have been delivered to Xxxxxxxx & Xxxxx, counsel to the
Company.
(viii) No Association with NASD. Except as previously disclosed to
the Underwriters, neither such Selling Shareholder nor any of his or its
affiliates directly, or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, or has any
other association with, any member firm of the National Association of
Securities Dealers, Inc. (the "NASD") within the meaning of Article I,
Section 1(m) of the By-laws of the NASD.
(ix) Management Selling Shareholders. Without having undertaken to
determine independently the accuracy or completeness of either the
representations and warranties of the Company contained herein or the
information contained in the Registration Statement, each Management
Selling Shareholder (defined as the Selling Shareholders
-11-
marked with an "*" in Schedule IV hereto) has no reason to believe that the
representations and warranties of the Company or the Principal Operating
Subsidiary contained in this Section 1 are not true and correct, is
familiar with the Registration Statement and has no knowledge of any
material fact, condition or information not disclosed in the Registration
Statement which has adversely affected or may adversely affect the business
of the Company or any of the Subsidiaries.
(x) Other Information. The sale of the Shares by such Selling
Shareholder pursuant hereto is not prompted by any information concerning
the Company or any of the Subsidiaries which is not set forth in the
Registration Statement. The information pertaining to such Selling
Shareholder under the caption "Principal and Selling Stockholders" in the
Prospectus is complete and accurate in all material respects.
(c) Officer's Certificates. Any certificate signed by any officer of the
Company or any of its Subsidiaries delivered to the Representatives 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 the Selling Shareholders as such and
delivered to the Representatives or to counsel for the Underwriters pursuant to
the terms of this Agreement shall be deemed a representation and warranty by
each such Selling Shareholder to the Underwriters as to the matters covered
thereby.
2. Purchase, Sale and Delivery of the Shares.
(a) Firm Shares. On the basis of the representations, warranties and
covenants herein contained, and subject to the conditions herein set forth,
the Sellers agree to sell to the Underwriters and each Underwriter agrees,
severally and not jointly, to purchase, at a price of $__.__ per share,
being an amount equal to the public offering price set forth above less the
underwriting discount of $__.__ per share, the number of Firm Shares set
forth opposite the name of each Underwriter in Schedule I hereto (the
number of Shares to be sold by the Company is set forth on Schedule III
hereto and the number of Shares to be sold by each Selling Shareholder is
set forth opposite the name of each Selling Shareholder on Schedule IV
hereto under the heading "Number of Firm Shares to be Sold"), subject to
adjustments in accordance with Section 9 hereof. The number of Firm Shares
to be purchased by each Underwriter from each Seller shall be as nearly as
practicable in the same proportion to the total number of Firm Shares being
sold by each Seller as the number of Firm Shares being purchased by each
Underwriter bears to the total number of Firm Shares to be sold hereunder.
The obligations of the Company and of each of the Selling Shareholders
shall be several and not joint.
(b) Payment for Firm Shares. Payment for the Firm Shares to be sold
hereunder is to be made by wire transfer of same-day funds to an account of
the Company for the Shares to be sold by it and to an account of, or by
check made payable to, the Selling Shareholder for the Shares to be sold by
such Selling Shareholder, in each case against delivery of certificates
therefor to the Representatives for the several accounts of the
Underwriters.
-12-
Such payment and delivery are to be made at the offices of Alex. Xxxxx, Xxx
Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx, or such other place as shall be agreed
upon by the Representatives and the Company, at 9:00 a.m., Baltimore time,
on the third (fourth, if pricing occurs after 4:30 p.m. (Eastern Time) on
any given day) business day after the date of this Agreement or at such
other time and date not later than five business days thereafter as you and
the Company shall agree upon (such time and date being herein referred to
as the "Closing Date"). As used herein, "business day" means a day on
which the New York Stock Exchange is open for trading and on which banks in
New York are open for business and not permitted by law or executive order
to be closed. The certificates for the Firm Shares will be delivered in
such denominations and in such registrations as the Representatives request
in writing not later than the second full business day prior to the Closing
Date, and will be made available for inspection by the Representatives at
least one business day prior to the Closing Date. It is understood that
each Underwriter has authorized the Representatives, for its account, to
accept delivery of, receipt for, and make payment of the purchase price
for, the Firm Shares, which it has agreed to purchase. Alex. Xxxxx,
individually and not as a Representative of the Underwriters, may (but
shall not be obligated to) make payment of the purchase price for the Firm
Shares to be purchased by any Underwriter whose funds have not been
received by the Closing Date, but such payment shall not relieve such
Underwriter from its obligations hereunder.
(c) Option Shares. In addition, on the basis of the representations and
warranties herein contained and subject to the terms and conditions herein
set forth, certain Selling Shareholders (marked with an "+" in Schedule IV
hereto) hereby grant an option to the several Underwriters to purchase up
to the number of Option Shares set forth opposite the name of each Selling
Shareholder in Schedule IV hereto under the heading "Number of Option
Shares to be Sold", subject to adjustments as set forth herein, at the
price per share as set forth in the first paragraph of this Section 2. The
option granted hereby may be exercised in whole or in part by giving
written notice (i) at any time before the Closing Date and (ii) only once
thereafter within 30 days after the date of this Agreement, by you, as
Representatives of the several Underwriters, to the Company and such
certain Selling Shareholders, setting forth the number of Option Shares as
to which the several Underwriters are exercising the option, the names and
denominations in which the Option Shares are to be registered and the time
and date at which such certificates are to be delivered. The time and date
at which certificates for Option Shares are to be delivered shall be
determined by the Representatives but shall not be earlier than three nor
later than 10 full business days after the exercise of such option, nor in
any event prior to the Closing Date (such time and date being herein
referred to as the "Option Closing Date"). If the date of exercise of the
option is three or more days before the Closing Date, the notice of
exercise shall set the Closing Date as the Option Closing Date. The number
of Option Shares to be purchased by each Underwriter shall be in the same
proportion to the total number of Option Shares being purchased as the
number of Firm Shares being purchased by such Underwriter bears to the
total number of Firm Shares, adjusted by you in such manner as to avoid
fractional shares. The option with respect to the Option Shares granted
hereunder may be exercised only to cover over-allotments in the sale of the
Firm
-13-
Shares by the Underwriters. You, as Representatives of the several
Underwriters, may cancel such option at any time prior to its expiration by
giving written notice of such cancellation to the Company. To the extent,
if any, that the option is exercised, payment for the Option Shares shall
be made on the Option Closing Date by wire transfer of same-day funds to an
account of, or by check made payable to, the Selling Shareholder for the
Option Shares to be sold by such Selling Shareholder, in each case against
delivery of certificates therefor at the offices of Alex. Xxxxx, Xxx Xxxxx
Xxxxxx, Xxxxxxxxx, Xxxxxxxx, or at such other place as shall be agreed upon
by the Representatives and the Company. It is understood that each
Underwriter has authorized the Representatives, for its account, to accept
delivery of, receipt for, and make payment of the purchase price for, the
Option Shares, if any, which it has agreed to purchase. Alex. Xxxxx,
individually and not as representative of the Underwriters, may (but shall
not be obligated to) make payment of the purchase price for the Option
Shares, if any, to be purchased by any Underwriter whose funds have not
been received by the Option Closing Date, but such payment shall not
relieve such Underwriter from its obligations hereunder.
(d) Failure to Deliver the Shares. If on the Closing Date or the Option
Closing Date, as the case may be, any Selling Shareholder fails to sell the
Shares which such Selling Shareholder has agreed to sell on such date as
set forth in Schedule IV hereto, the Company agrees that it will sell or
arrange for the sale of that number of shares of Common Stock to the
Underwriters which represents the Shares which such Selling Shareholder has
failed to so sell as set forth in Schedule IV hereto, or such lesser number
as may be requested by the Representatives.
3. Offering by the Underwriters.
(a) Public Offering. It is understood that the several Underwriters are to
make a public offering of the Firm Shares as soon as the Representatives
deem it advisable to do so. The Firm Shares are to be initially offered to
the public at the public offering price set forth in the Prospectus. The
Representatives may from time to time thereafter change the public offering
price and other selling terms. To the extent, if at all, that any Option
Shares are purchased pursuant to Section 2 hereof, the Underwriters will
offer them to the public on the foregoing terms.
(b) Agreement Among Underwriters. It is further understood that you will
act as the Representatives for the Underwriters in the offering and sale of
the Shares in accordance with a Master Agreement Among Underwriters entered
into by you and the several other Underwriters.
4. Covenants.
(a) Covenants of the Company. The Company covenants and agrees with the
several Underwriters that:
-14-
(i) Compliance with Securities Regulations. The Company will (A) use
its best efforts to cause the Registration Statement to become effective
or, if the procedure in Rule 430A of the Rules and Regulations is followed,
to prepare and timely file with the Commission under Rule 424(b) of the
Rules and Regulations a Prospectus in a form approved by the
Representatives containing information previously omitted at the time of
effectiveness of the Registration Statement in reliance on Rule 430A of the
Rules and Regulations, and (B) not file any amendment to the Registration
Statement or supplement to the Prospectus of which the Representatives
shall not previously have been advised and furnished with a copy or to
which the Representatives shall have reasonably objected in writing or
which is not in compliance with the Rules and Regulations. To the extent
applicable, the copies of the Registration Statement (including all
exhibits filed therewith), any preliminary prospectus or Prospectus
furnished to the Underwriters shall be identical to the copies thereof
electronically filed with the Commission on XXXXX, except to the extent
permitted by Regulation S-T.
(ii) Notice of Action by the Commission. The Company will advise the
Representatives promptly (A) when the Registration Statement or any post-
effective amendment thereto shall have become effective, (B) of receipt of
any comments from the Commission, (C) of any request of the Commission for
amendment of the Registration Statement or for supplement to the Prospectus
or for any additional information, and (D) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the use of the Prospectus or of the institution
or threatening of any proceedings for that purpose. The Company will use
its best efforts to prevent the issuance of any such stop order preventing
or suspending the use of the Prospectus and to obtain as soon as possible
the lifting thereof, if issued.
(iii) Blue Sky Qualification. The Company will cooperate with the
Representatives in endeavoring to qualify the Shares for sale under the
securities laws of such jurisdictions as the Representatives may reasonably
have designated in writing and will make such applications, file such
documents, and furnish such information as may be reasonably required for
that purpose, provided the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process in
any jurisdiction where it is not now so qualified or required to file such
a consent. The Company will, from time to time, prepare and file such
statements, reports, and other documents, as are or may be required to
continue such qualifications in effect for so long a period as the
Representatives may reasonably request for distribution of the Shares.
(iv) Delivery of Prospectuses. The Company will deliver to, or upon
the order of, the Representatives, from time to time, as many copies of any
preliminary prospectus as the Representatives may reasonably request. The
Company will deliver to, or upon the order of, the Representatives during
the period when delivery of a Prospectus is required under the Act, as many
copies of the Prospectus in final form, or as thereafter amended or
supplemented, as the Representatives may reasonably request. The Company
will deliver to the Representatives, at or before the Closing Date, four
signed copies of the Registration Statement and all amendments thereto
including all exhibits filed therewith,
-15-
and will deliver to the Representatives such number of copies of the
Registration Statement (including such number of copies of the exhibits
filed therewith that may reasonably be requested), and of all amendments
thereto, as the Representatives may reasonably request.
(v) Continued Compliance with Securities Regulations. The Company
will comply with the 1933 Act and the Rules and Regulations, and the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and the rules
and regulations of the Commission thereunder, so as to permit the
completion of the distribution of the Shares as contemplated in this
Agreement and the Prospectus. If during the period in which a prospectus
is required by law to be delivered by an Underwriter or dealer, any event
shall occur as a result of which, in the judgment of the Company or in the
reasonable opinion of the Underwriters, it becomes necessary to amend or
supplement the Prospectus in order to make the statements therein, in the
light of the circumstances existing at the time the Prospectus is delivered
to a purchaser, not misleading, or, if it is necessary at any time to amend
or supplement the Prospectus to comply with any law, the Company promptly
will prepare and file with the Commission an appropriate amendment to the
Registration Statement or supplement to the Prospectus so that the
Prospectus as so amended or supplemented will not, in the light of the
circumstances when it is so delivered, be misleading, or so that the
Prospectus will comply with the law and the Company will furnish to the
Underwriters such number of copies of such amendment or supplement as the
Underwriters may reasonably request.
(vi) Rule 158. The Company will make generally available to its
security holders, as soon as it is practicable to do so, but in any event
not later than 15 months after the effective date of the Registration
Statement, an earning statement (which need not be audited) in reasonable
detail, covering a period of at least 12 consecutive months beginning after
the effective date of the Registration Statement, which earning statement
shall satisfy the requirements of Section 11(a) of the 1933 Act and Rule
158 of the Rules and Regulations and will advise you in writing when such
statement has been so made available.
(vii) Delivery of Reports. The Company will, for a period of three
years from the Closing Date, deliver to the Representatives copies of
annual reports and copies of all other documents, reports and information
furnished by the Company to its stockholders or filed with any securities
exchange pursuant to the requirements of such exchange or with the
Commission pursuant to the 1933 Act or the 1934 Act. To the extent
applicable, such reports and documents shall be identical to the copies
thereof electronically filed with the Commission on XXXXX, except to the
extent permitted by Regulation S-T.
(viii) Restriction on the Sale of Securities. During a period of 90
days from the date of the Prospectus, the Company will not, without the
prior written consent of Alex. Xxxxx, (i) directly or indirectly, offer,
pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant
to purchase or otherwise transfer or dispose of any share of Common Stock
or any securities convertible into or exercisable or exchangeable for
Common Stock or file any
-16-
registration statement under the 1933 Act with respect to any of the
foregoing or (ii) enter into any swap or any other agreement or any
transaction that transfers, in whole or in part, directly or indirectly,
the economic consequence of ownership of the Common Stock, whether any such
swap or transaction described in clause (i) or (ii) above is to be settled
by delivery of Common Stock or such other securities, in cash or otherwise.
The foregoing sentence shall not apply to (A) the Shares to be sold
hereunder, (B) any shares of Common Stock issued by the Company upon the
exercise of an option or warrant or the conversion of a security
outstanding on the date hereof or options to purchase Common Stock granted
pursuant to existing employee benefit plans of the Company referred to in
the Prospectus or (D) any shares of Common Stock issued pursuant to any
non-employee director stock plan or employee stock purchase plan.
(ix) Listing. The Company will use its best efforts to list, subject
to notice of issuance, the Shares to be sold by the Company on the Nasdaq
National Market. The Company will use its best efforts to effect and
maintain the quotation of the Shares on the Nasdaq National Market and will
file with the Nasdaq National Market all documents and notices required by
the Nasdaq National Market of companies that have securities that are
traded in the over-the-counter market and quotations for which are reported
by the Nasdaq National Market.
(x) Use of Proceeds. The Company shall apply the net proceeds of its
sale of the Shares substantially as set forth in the Prospectus under "Use
of Proceeds."
(xi) Investment Company Act. The Company shall not invest, or
otherwise use the proceeds received by the Company from its sale of the
Shares in such a manner as would require the Company or any of the
Subsidiaries to register as an investment company under the 1940 Act.
(xii) Transfer Agent. The Company will maintain a transfer agent
and, if necessary under the jurisdiction of incorporation of the Company, a
registrar for the Common Stock.
(xiii) Absence of Manipulation. The Company will not take, directly
or indirectly, any action designed to cause or result in, or that has
constituted or might reasonably be expected to constitute, the
stabilization or manipulation of the price of any securities of the Company
in violation of the 1933 Act or the Rules and Regulations or the 1934 Act
and the rules and regulations of the Commission thereunder.
(b) Covenants of the Selling Shareholders. Each of the Selling
Shareholders covenants and agrees with the several Underwriters that:
(i) Form W-9. In order to document the Underwriters' compliance with
the reporting and withholding provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 and the Interest and Dividend Tax Compliance Act
of 1983 with respect to the transactions herein contemplated, each of the
Selling Shareholders agrees to deliver to you
-17-
prior to or at the Closing Date a properly completed and executed United
States Treasury Department Form W-9 (or other applicable form or statement
specified by Treasury Department regulations in lieu thereof).
(ii) Absence of Manipulation. Such Selling Shareholder will not take,
directly or indirectly, any action designed to cause or result in, or that
has constituted or might reasonably be expected to constitute, the
stabilization or manipulation of the price of any securities of the Company
in violation of the 1933 Act or the Rules and Regulations or the 1934 Act
and the rules and regulations of the Commission thereunder.
5. Costs and Expenses.
The Company will pay all costs, expenses and fees incident to the
performance of the obligations of the Sellers under this Agreement, including,
without limiting the generality of the foregoing, the following: accounting
fees of the Company; the fees and disbursements of counsel for the Company; the
cost of preparation, printing, filing, and delivering to, or as requested by,
the Underwriters copies of the Registration Statement, preliminary prospectuses,
the Prospectus, this Agreement, any agreement among Underwriters, the Nasdaq
National Market Listing Application, the Blue Sky Survey and any supplements or
amendments thereto, and such other documents as may be required in connection
with the offering, purchase, sale, issuance or delivery of the Shares; the
filing fees of the Commission; (iii) the preparation, issuance and delivery of
the certificates for the Shares to the Underwriters, including any stock or
other transfer taxes and any stamp or other duties payable upon the sale,
issuance or delivery of the Shares to the Underwriters; the filing fees incident
to securing any required review by the NASD of the terms of the sale of the
Shares; the Listing Fee of the Nasdaq National Market and the inclusion of the
Shares to be sold by the Company on the Nasdaq National Market; the fees and
expenses of any transfer agent or registrar for the Shares; and the expenses,
including the reasonable fees and disbursements of counsel for the Underwriters,
incurred in connection with the qualification of the Shares under State
securities or Blue Sky laws. The Company shall not, however, be required to pay
for any of the Underwriters expenses (other than those related to qualification
under NASD regulation and State securities or Blue Sky laws) except that, if
this Agreement shall not be consummated because the conditions in Section 6
hereof are not satisfied, or because this Agreement is terminated by the
Representatives pursuant to Section 10 hereof or paragraphs (A) or (E) of
Section 12(a)(i) hereof, or by reason of any failure, refusal or inability on
the part of the Company or the Selling Shareholders to perform any undertaking
or satisfy any condition of this Agreement or to comply with any of the terms
hereof on their part to be performed, unless such failure to satisfy said
condition or to comply with said terms be due to the default or omission of any
Underwriter, then the Company shall reimburse the several Underwriters for
reasonable out-of-pocket expenses, including reasonable fees and disbursements
of counsel for the Underwriters, reasonably incurred in connection with
investigating, marketing and proposing to market the Shares or in contemplation
of performing their obligations hereunder.
-18-
6. Conditions of Obligations of the Underwriters.
(a) Accuracy of Representations and Warranties; Performance of Covenants;
Other Conditions. The several obligations of the Underwriters to purchase
the Firm Shares on the Closing Date and the Option Shares, if any, on the
Option Closing Date are subject to the accuracy, as of the Closing Date or
the Option Closing Date, as the case may be, of the representations and
warranties of the Company, the Principal Operating Subsidiary and the
Selling Shareholders contained herein, and to the performance by the
Company and the Selling Shareholders of their covenants and obligations
hereunder and to the following additional conditions:
(i) Effectiveness of the Registration Statement. The Registration
Statement, including any Rule 462(b) Registration Statement, and all post-
effective amendments thereto shall have become effective and any and all
filings required by Rule 424 and Rule 430A of the Rules and Regulations
shall have been made, or, if the Company has elected to rely upon Rule 434,
a Term Sheet shall have been filed with the Commission in accordance with
Rule 424(b), and any request of the Commission for additional information
(to be included in the Registration Statement or otherwise) shall have been
disclosed to the Representatives and complied with to their reasonable
satisfaction. No stop order suspending the effectiveness of the
Registration Statement, as amended from time to time, shall have been
issued and no proceedings for that purpose shall have been taken or, to the
knowledge of the Company, shall be contemplated by the Commission and no
injunction, restraining order, or order of any nature by a Federal or state
court of competent jurisdiction shall have been issued as of the Closing
Date which would prevent the issuance of the Shares.
(ii) Opinions of Counsel for the Company. The Representatives shall
have received on the Closing Date or the Option Closing Date, as the case
may be, the opinions of: (A) Xxxxxxxx & Xxxxx, counsel for the Company; (B)
Xxxxxxx, Xxx & Blinkoff, counsel for the Company; and (C) Brinks Xxxxx
Xxxxxx & Xxxxx P.C., Intellectual Property counsel for the Company, each
dated the Closing Date or the Option Closing Date, as the case may be,
addressed to the Underwriters (stating that it may be relied upon by
counsel to the Underwriters) and in form and substance satisfactory to
counsel for the Underwriters and substantially in the form set forth in
Exhibit 2, Exhibit 3 and Exhibit 4, respectively, and to such further
effect as counsel to the Underwriters may reasonably request.
(iii) Opinion of Counsel for the Underwriters. The Representatives
shall have received from Ropes & Xxxx, counsel for the Underwriters, an
opinion dated the Closing Date or the Option Closing Date, as the case may
be, together with signed or reproduced copies of such letter for each of
the other Underwriters. In giving such opinion such counsel may rely, as
to all matters governed by the laws of jurisdictions other than the law of
the Commonwealth of Massachusetts and the federal law of the United States
and the General Corporation Law of the State of Delaware, upon the opinions
of counsel satisfactory to the Representatives. Such counsel may also
state that, insofar as such
-19-
opinion involves factual matters, they have relied, to the extent they deem
proper, upon certificates of officers of the Company and its Subsidiaries
and certificates of public officials.
(iv) Opinion of Counsel for the Selling Shareholder. On the Closing
Date or the Option Closing Date, as the case may be, the Representatives
shall have received the favorable opinion, dated as of the Closing Date or
the Option Closing Date, as the case may be, of (A) Xxxxxxxx & Xxxxx,
counsel for certain of the Selling Shareholders and (B) White & Case,
counsel for BT Investment Partners, Inc., or such other counsel as is
reasonably acceptable to counsel for the Underwriters, in each case in form
and substance satisfactory to counsel for the Underwriters together with
signed or reproduced copies of such letter for each of the other
Underwriters to the effect set forth in Exhibit 5 hereto and to such
further effect as counsel to the Underwriters may reasonably request.
(v) Blue Sky Survey. The Representatives shall have received at or
prior to the Closing Date from Ropes & Xxxx a memorandum or summary, in
form and substance satisfactory to the Representatives, with respect to the
qualification for offering and sale by the Underwriters of the Shares under
the State securities or Blue Sky laws of such jurisdictions as the
Representatives may reasonably have designated to the Company.
(vi) Accountant's Comfort Letter. You shall have received, on each of
the dates hereof, the Closing Date and the Option Closing Date, if
applicable, a letter from Price Waterhouse LLP dated the date hereof, the
Closing Date or the Option Closing Date, as the case may be, in form and
substance satisfactory to you and Price Waterhouse LLP, together with
signed or reproduced copies of such letter for each of the other
Underwriters containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to
the financial statements and certain financial information contained in the
Registration Statement and the Prospectus.
(vii) Officers' Certificate. The Representatives shall have received
on the Closing Date or the Option Closing Date, as the case may be, a
certificate or certificates of the Chief Executive Officer and the Chief
Financial Officer of the Company and the Principal Operating Subsidiary to
the effect that, as of the Closing Date or the Option Closing Date, as the
case may be, each of them severally represents in their capacity as an
officer of the Company as follows:
(A) The Registration Statement has become effective under the
1933 Act and no stop order suspending the effectiveness of the
Registration Statement or any part thereof has been received by the
Company, and to our knowledge no such stop order has been issued under
the 1933 Act and no proceedings for that purpose have been initiated
or threatened by the Commission and any request of the Commission for
inclusion of additional information in the Registration Statement has
been complied with;
(B) The representations and warranties of the Company and the
Principal Operating Subsidiary contained in Section 1(a) of the
Underwriting Agreement are true and correct, on and as of the Closing
-20-
Date or the Option Closing Date, as the case may be, with the same
force and effect as if expressly made on and as of the Closing Date or
the Option Closing Date, as the case may be;
(C) All filings required to have been made pursuant to Rules 424
or 430A under the 1933 Act have been made;
(D) The Company and the Principal Operating Subsidiary has
complied with all agreements and satisfied all conditions on its part
to be performed or satisfied at or prior to the Closing Date or the
Option Closing Date, as the case may be;
(E) The Registration Statement of the Company on Form S-1
(Registration No. 333-32493), in the form in which it was declared
effective by the Commission on August __, 1997, and the Prospectus
dated August __, 1997, contain all statements which are required to be
stated therein in accordance with the 1933 Act and the rules and
regulations of the Commission thereunder and neither the Registration
Statement nor the Prospectus contains an untrue statement of a
material fact or omits to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
(F) Since the time the Registration Statement was declared
effective, no event has occurred which should have been set forth in a
supplement to or amendment of the Registration Statement or the
Prospectus which has not been so set forth in such supplement or
amendment;
(G) Since the respective dates as of which information is given
in the Registration Statement and Prospectus, there has not been any
material adverse change or any development involving a prospective
material adverse change in or affecting the condition, financial or
otherwise, of the Company and its Subsidiaries taken as a whole or the
earnings, business, management, properties, assets, rights,
operations, condition (financial or otherwise) or prospects of the
Company and the Subsidiaries taken as a whole, whether or not arising
in the ordinary course of business;
(H) No action, suit or proceeding at law or in equity is pending
or, to the knowledge of the Company, threatened against the Company or
any Subsidiary that would be required to be set forth in the
Prospectus other than as set forth therein and no proceedings are
pending or, to the knowledge of the Company, threatened against the
Company before or by any government, governmental instrumentality or
court, domestic or foreign, that could result in any material adverse
change in the condition (financial or otherwise), earnings, business
affairs or business prospects of
-21-
the Company and its subsidiaries, considered as one enterprise, other
than as set forth in the Prospectus; and
(I) No event of default exists under any contract, indenture,
mortgage, loan agreement, note, lease or other agreement or instrument
to which the Company or any Subsidiary is a party or to which the
Company or any Subsidiary is subject, except where such default would
not reasonably be expected to result in a Material Adverse Effect.
(viii) Secretary's Certificate. The Representatives shall have
received on the Closing Date or the Option Closing Date, as the case may
be, a certificate or certificates of the Secretary of the Company and the
Principal Operating Subsidiary in form and substance reasonably
satisfactory to the Representatives.
(ix) Certificates of the Selling Shareholders. On the Closing Date or
the Option Closing Date, as the case may be, the Representatives shall have
received a certificate from each of the Selling Shareholders, dated as of
the Closing Date or the Option Closing Date, as the case may be, to the
effect that (i) the representations and warranties of such Selling
Shareholder contained in Section 1(b) hereof are true and correct in all
respects with the same force and effect as though expressly made at and as
of the Closing Date or the Option Closing Date, as the case may be, and
(ii) such Selling Shareholder has complied in all material respects with
all agreements and all conditions on its part to be performed under this
Agreement at or prior to the Closing Date or the Option Closing Date, as
the case may be.
(x) Approval of Listing. At Closing Date and the Option Closing Date,
as the case may be, the Shares shall have been approved for listing on the
Nasdaq National Market, subject only to official notice of issuance.
(xi) No Objection. The NASD shall have confirmed that it has not
raised any objection with respect to the fairness and reasonableness of the
underwriting terms and arrangements.
(xii) Lock-Up Agreements. As of the date of this Agreement, the
Representatives shall have received Lock-Up Agreements substantially in the
form of Exhibit 1 hereto executed by the persons listed on Schedule VI
hereto, and such agreements are in full force and effect.
(b) Compliance with Requirements. The opinions and certificates mentioned
in this Agreement shall be deemed to be in compliance with the provisions
hereof only if they are in all material respects reasonably satisfactory to
the Representatives and to Ropes & Xxxx, counsel for the Underwriters.
(c) Additional Documents. At the Closing Date or the Option Closing Date,
as the case may be, counsel for the Underwriters shall have been furnished
with such documents
-22-
and opinions as they may require for the purpose of enabling them to pass
upon the issuance and sale of the Shares as herein contemplated, or in
order to evidence the accuracy of any of the representations or warranties,
or the fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Company in connection with the issuance and sale
of the Shares as herein contemplated shall be reasonably satisfactory in
form and substance to the Representatives and counsel for the Underwriters.
(d) Termination of Agreement. If any of the conditions hereinabove
provided for in this Section 6 shall not have been fulfilled when and as
required by this Agreement to be fulfilled, the obligations of the
Underwriters hereunder may be terminated by the Representatives by
notifying the Company and the Selling Shareholders of such termination in
writing or by telegram at or prior to the Closing Date or the Option
Closing Date, as the case may be. In such event, the Selling Shareholders,
the Company and the Underwriters shall not be under any obligation to each
other (except to the extent provided in Sections 5 and 8 hereof and except
that Sections 1, 8 and 14 shall survive any such termination and remain in
full force and effect).
7. Conditions of the Obligations of the Sellers.
The obligations of the Sellers to sell and deliver the portion of the
Shares required to be delivered as and when specified in this Agreement are
subject to the conditions that at the Closing Date or the Option Closing Date,
as the case may be, no stop order suspending the effectiveness of the
Registration Statement shall have been issued and in effect or proceedings
therefor initiated or threatened.
8. Indemnification.
(a) Indemnification of Underwriters by the Company and the Principal
Operating Subsidiary. The Company and the Principal Operating Subsidiary
agree to indemnify and hold harmless each Underwriter and each person, if
any, who controls any Underwriter within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act, against any and all losses, claims,
expenses, damages or liabilities to which such Underwriter or any such
controlling person may become subject under the 1933 Act or otherwise,
insofar as such losses, claims, expenses, damages or liabilities (or
actions or proceedings in respect thereof) arise out of or are based upon
(i) any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement (or any amendment thereto),
including the Rule 430A Information and the Rule 434 Information, if
applicable, any preliminary prospectus, the Prospectus or any amendment or
supplement thereto, or (ii) the omission or alleged omission to state
therein a material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under which
they were made, not misleading; and will reimburse each Underwriter and
each such controlling person on demand for any amount paid in settlement of
any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or of any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue
statement or omission, provided that
-23-
(subject to Section 8(c) below) any such settlement is effected with the
written consent of the Company; and will reimburse each Underwriter and
each such controlling person upon demand for any legal or other expenses
reasonably incurred by such Underwriter or such controlling person in
connection with investigating or defending any such loss, claim, expense,
damage or liability, action or proceeding or in responding to a subpoena or
governmental inquiry related to the offering of the Shares, whether or not
such Underwriter or controlling person is a party to any action or
proceeding; provided that the Company and the Principal Operating
Subsidiary will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement, or omission or alleged omission made
in the Registration Statement, any preliminary prospectus, the Prospectus,
or such amendment or supplement, in reliance upon and in conformity with
written information furnished to the Company by or through the
Representatives specifically for use in the preparation thereof; provided,
further, that such indemnity with respect to any preliminary prospectus
shall not inure to the benefit of any Underwriter from whom the person
asserting such loss, claim, damage or liability purchased the Shares which
are the subject thereof if such person did not receive a copy of the
Prospectus (as supplemented or amended) at or prior to the confirmation of
the sale of the Shares to such person in any case where such delivery is
required by the 1933 Act and the untrue statement or omission or alleged
untrue statement or omission of material fact contained in the preliminary
prospectus was corrected in the Prospectus. This indemnity agreement will
be in addition to any liability which the Company or the Principal
Operating Subsidiary may otherwise have.
(b) Indemnification of the Underwriters by the Selling Shareholders. Each
Selling Shareholder severally and not jointly will indemnify and hold
harmless each Underwriter, and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20
of the 1934 Act, against any losses, claims, damages or liabilities to
which any Underwriter or any person who controls any Underwriter within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act may
become subject under the 1933 Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of or are based upon (i) any untrue statement or alleged
untrue statement of any material fact contained in the Registration
Statement, any preliminary prospectus, the Prospectus or any amendment or
supplement thereto, or (ii) the omission or the alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading in the light of the circumstances
under which they were made; and will reimburse any legal or other expenses
reasonably incurred by any Underwriter or any person who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20
of the 1934 Act in connection with investigating or defending any such
loss, claim, damage, liability, action or proceeding; provided, however,
that each Selling Shareholder will be liable in each case to the extent,
but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission has been made in the Registration
Statement, any preliminary prospectus, the Prospectus or such amendment or
supplement, in reliance upon and in conformity with written information
furnished to the Company or any Underwriter by or through the Selling
Shareholder
-24-
specifically for use in the preparation thereof; provided, further, that
such indemnity with respect to any preliminary prospectus shall not inure
to the benefit of any Underwriter from whom the person asserting such loss,
claim, damage or liability purchased the Shares which are the subject
thereof if such person did not receive a copy of the Prospectus (as
supplemented or amended) at or prior to the confirmation of the sale of the
Shares to such person in any case where such delivery is required by the
1933 Act and the untrue statement or omission or alleged untrue statement
or omission of material fact contained in the preliminary prospectus was
corrected in the Prospectus. In no event, however, shall the liability of
any Selling Shareholder for indemnification under this Section 8(b) exceed
the proceeds received by such Selling Shareholder from the Underwriters
hereunder. This indemnity agreement will be in addition to any liability
which the Selling Shareholders may otherwise have. The Company agrees that
the Selling Shareholders may implead the Company in any action in which the
Underwriters or any such controlling person is seeking indemnification from
the Selling Shareholders. The Company, the Principal Operating Subsidiary,
the Selling Shareholders and the Underwriters acknowledge and agree that
the only information furnished or to be furnished to the Company for
inclusion in any prospectus or the Registration Statement by any Selling
Shareholder consists of the information set forth under the caption
"Principal and Selling Stockholders" (including the notes thereto) in the
Registration Statement, any preliminary prospectus, the Prospectus and any
amendment or supplement thereto.
(c) Indemnification of the Company, Directors, Officers and Selling
Shareholders. Each Underwriter severally and not jointly will indemnify and
hold harmless the Company, each of its directors, each of its officers who
have signed the Registration Statement, the Selling Shareholders, and each
person, if any, who controls the Company or the Selling Shareholders within
the meaning of the 1933 Act, against any losses, claims, damages or
liabilities to which the Company or any such director, officer, Selling
Shareholder or controlling person may become subject under the 1933 Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) arise out of or are based upon
(i) any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, any preliminary prospectus, the
Prospectus or any amendment or supplement thereto, or (ii) the omission or
the alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading in the
light of the circumstances under which they were made; and will reimburse
any legal or other expenses reasonably incurred by the Company or any such
director, officer, Selling Shareholder or controlling person in connection
with investigating or defending any such loss, claim, damage, liability,
action or proceeding; provided, however, that each Underwriter will be
liable in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission has
been made in the Registration Statement, any preliminary prospectus, the
Prospectus or such amendment or supplement, in reliance upon and in
conformity with written information furnished to the Company by or through
the Representatives specifically for use in the preparation thereof. This
indemnity agreement will be in addition to any liability which such
Underwriter may otherwise have.
-25-
(d) Actions Against Parties; Notification; Settlement Without Consent. In
case any proceeding (including any governmental investigation) shall be
instituted involving any person in respect of which indemnity may be sought
pursuant to this Section 8, such person (the "indemnified party") shall
promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing. No indemnification provided for in
Section 8(a), (b) or (c) shall be available to any party who shall fail to
give notice as provided in this Section 8(d) if the party to whom notice
was not given was unaware of the proceeding to which such notice would have
related and was materially prejudiced by the failure to give such notice,
but the failure to give such notice shall not relieve the indemnifying
party or parties from any liability which it or they may have to the
indemnified party for contribution or otherwise than on account of the
provisions of Section 8(a), (b) or (c). In case any such proceeding shall
be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party
shall be entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel satisfactory to such indemnified
party and shall pay as incurred the reasonable fees and disbursements of
such counsel related to such proceeding. In any such proceeding, any
indemnified party shall have the right to retain its own counsel at its own
expense. Notwithstanding the foregoing, the indemnifying party shall pay
as incurred (or within 30 days of presentation) the reasonable fees and
expenses of the counsel retained by the indemnified party in the event (i)
the indemnifying party and the indemnified party shall have mutually agreed
to the retention of such counsel, (ii) the named parties to any such
proceeding (including any impleaded parties) include both the indemnifying
party and the indemnified party and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing
interests between them, or (iii) the indemnifying party shall have failed
to assume the defense and employ counsel acceptable to the indemnified
party within a reasonable period of time after notice of commencement of
the action. It is understood that the indemnifying party shall not, in
connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees and expenses of more than
one separate firm for all such indemnified parties. Such firm shall be
designated in writing by you in the case of parties indemnified pursuant to
Section 8(a) or (b) and by the Company and the Selling Shareholders in the
case of parties indemnified pursuant to Section 8(c). The indemnifying
party shall not be liable for any settlement of any proceeding effected
without its written consent but if settled with such consent or if there be
a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by
reason of such settlement or judgment (provided that such indemnified party
is entitled to indemnification under Section 8(a), (b) or (c) hereunder).
In addition, the indemnifying party will not, without the prior written
consent of the indemnified party, settle or compromise or consent to the
entry of any judgment in any pending or threatened claim, action or
proceeding of which indemnification may be sought hereunder (whether or not
any indemnified party is an actual or potential party to such claim, action
or proceeding) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising
out of such claim, action or proceeding and does not include a statement as
to or an admission of fault, culpability or a failure to act by or on
behalf of any
-26-
indemnified party. If at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for fees
and expenses of counsel, such indemnifying party agrees that it shall be
liable for any settlement of the nature contemplated by Section 8(a), (b)
or (c) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of
the aforesaid request, (ii) such indemnifying party shall have received
notice of the terms of such settlement at least 30 days prior to such
settlement being entered into, (iii) such indemnifying party shall not have
reimbursed such indemnified party in accordance with such request prior to
the date of such settlement, and (iv) the indemnifying party has not
delivered a notice to the indemnified party at least 30 days prior to such
settlement being entered into setting forth its reasonable objections to
such request.
(e) Contribution. If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
Section 8(a), (b) or (c) above in respect of any losses, claims, expenses,
damages or liabilities (or actions or proceedings in respect thereof)
referred to therein, then each indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of such
losses, claims, expenses, damages or liabilities (or actions or proceedings
in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company, the Principal Operating
Subsidiary and the Selling Shareholders on the one hand and the
Underwriters on the other from the offering of the Shares. If, however,
the allocation provided by the immediately preceding sentence is not
permitted by applicable law then each indemnifying party shall contribute
to such amount paid or payable by such indemnified party in such proportion
as is appropriate to reflect not only such relative benefits but also the
relative fault of the Company, the Principal Operating Subsidiary and the
Selling Shareholders on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities, (or actions or proceedings in respect
thereof), as well as any other relevant equitable considerations. The
relative benefits received by the Company, the Principal Operating
Subsidiary and the Selling Shareholders on the one hand and the
Underwriters on the other shall be deemed to be in the same proportion as
the total net proceeds from the offering (before deducting expenses)
received by the Company, the Principal Operating Subsidiary and the Selling
Shareholders and 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 or, if Rule 434 is used, the corresponding location
on the Term Sheet, bear to the aggregate public offering price of the
Shares as set forth on such cover. 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 Principal
Operating Subsidiary or the Selling Shareholders on the one hand or the
Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement
or omission. Notwithstanding the provisions of this Section 8(e), (i) no
Selling Shareholder shall be required to contribute any amount in excess of
the amount of the total net proceeds received by such Selling Shareholder
from the Shares purchased from such Selling
-27-
Shareholder, and (ii) no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the Shares
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages that such Underwriter has otherwise been
required to pay by reason of any such untrue or alleged untrue statement or
omission or alleged omission.
(f) Limitation on Contribution. The Company, the Selling Shareholders and
the Underwriters agree that it would not be just and equitable if
contributions pursuant to Section 8(d) were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in Section 8(e). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions or proceedings in respect
thereof) referred to above in Section 8(e) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of subsection (e), (i) no Underwriter shall
be required to contribute any amount in excess of the underwriting
discounts and commissions applicable to the Shares purchased by such
Underwriter, (ii) 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,
and (iii) no Selling Shareholder shall be required to contribute any amount
in excess of the proceeds received by such Selling Shareholder from the
Underwriters in the Offering. The Underwriters' obligations in Section
8(e) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(g) Rights of Controlling Persons. For purposes of this Section 8, each
person, if any, who controls an Underwriter within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights
to contribution as such Underwriter, and each director of the Company, each
officer of the Company who signed the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section 15
of the 1933 Act or Section 20 of the 1934 Act and any Selling Shareholder
shall have the same rights to contribution as the Company, the Principal
Operating Subsidiary or such Selling Shareholders, as the case may be.
(h) Consent to Jurisdiction. In any proceeding relating to the
Registration Statement, any preliminary prospectus, the Prospectus or any
supplement or amendment thereto, each party against whom contribution may
be sought under this Section 8 hereby consents to the jurisdiction of any
court having jurisdiction over any other contributing party, agrees that
process issuing from such court may be served upon him or it by any other
contributing party and consents to the service of such process and agrees
that any other contributing party may join him or it as an additional
defendant in any such proceeding in which such other contributing party is
a party.
(i) Payments. Any losses, claims, damages, liabilities or expenses for
which an indemnified party is entitled to indemnification or contribution
under this Section 8 shall
-28-
be paid by the indemnifying party to the indemnified party as such losses,
claims, damages, liabilities or expenses are incurred. The indemnity and
contribution agreements contained in this Section 8 and the representations
and warranties of the Company, the Principal Operating Subsidiary or the
Selling Stockholders set forth in this Agreement or in certificates shall
remain operative and in full force and effect, regardless of (i) any
investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter, the Company, its directors or officers or any
persons controlling the Company, (ii) acceptance of any Shares and payment
therefor hereunder, and (iii) any termination of this Agreement. A
successor to any Underwriter, or to the Company, its directors or officers,
or any person controlling the Company, shall be entitled to the benefits of
the indemnity, contribution and reimbursement agreements contained in this
Section 8.
(j) Effect on Other Agreements. The provisions of this Section shall not
amend, alter or otherwise affect any agreement among the Company and the
Selling Shareholders with respect to indemnification, including the
Registration Rights Agreement, dated October 22, 1996, between the Company,
certain of the Selling Shareholders and the other parties named therein.
9. Default by Underwriters.
If on the Closing Date or the Option Closing Date, as the case may be, any
Underwriter shall fail to purchase and pay for the portion of the Shares which
such Underwriter has agreed to purchase and pay for on such date (otherwise than
by reason of any default on the part of the Company or a Selling Shareholder),
you, as Representatives of the Underwriters, shall use your reasonable efforts
to procure within 36 hours thereafter one or more of the other Underwriters, or
any others, to purchase from the Company and the Selling Shareholders such
amounts as may be agreed upon and upon the terms set forth herein, the Firm
Shares or Option Shares, as the case may be, which the defaulting Underwriter or
Underwriters failed to purchase. If during such 36 hours you, as such
Representatives, shall not have procured such other Underwriters, or any others,
to purchase the Firm Shares or Option Shares, as the case may be, agreed to be
purchased by the defaulting Underwriter or Underwriters, then (a) if the
aggregate number of shares with respect to which such default shall occur does
not exceed 10% of the Firm Shares or Option Shares, as the case may be, covered
hereby, the other Underwriters shall be obligated, severally, in proportion to
the respective numbers of Firm Shares or Option Shares, as the case may be,
which they are obligated to purchase hereunder, to purchase the Firm Shares or
Option Shares, as the case may be, which such defaulting Underwriter or
Underwriters failed to purchase, or (b) if the aggregate number of shares of
Firm Shares or Option Shares, as the case may be, with respect to which such
default shall occur exceeds 10% of the Firm Shares or Option Shares, as the case
may be, covered hereby, the Company or you as the Representatives of the
Underwriters will have the right, by written notice given within the next 36-
hour period to the parties to this Agreement, to terminate this Agreement
without liability on the part of the non-defaulting Underwriters or of the
Company or of the Selling Shareholders except to the extent provided in Section
8 hereof. In the event of a default by any Underwriter or Underwriters, as set
forth in this Section 9, the Closing Date or Option Closing Date, as the case
may be, may be postponed
-29-
for such period, not exceeding seven days, as you, as Representatives, may
determine in order that the required changes in the Registration Statement or in
the Prospectus or in any other documents or arrangements may be effected. The
term "Underwriter" includes any person substituted for a defaulting Underwriter.
Any action taken under this Section 9 shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
10. Default by Selling Shareholders or the Company.
(a) Default by Selling Shareholders. If any Selling Shareholder shall fail
at the Closing Date or the Option Closing Date, as the case may be, to sell
and deliver the number of Shares which such Selling Shareholders are
obligated to sell hereunder and the Company does not sell or arrange for
the sale of that number of Shares in accordance with Section 2(d), then the
Underwriters may, at the option of the Representatives, by notice from the
Representatives to the non-defaulting Selling Shareholders, either (a)
terminate this Agreement without any liability on the fault of any non-
defaulting party except that the provisions of Sections 1, 5 and 8 shall
remain in full force and effect or (b) elect to purchase the Shares which
the non-defaulting Selling Shareholders have agreed to sell hereunder. No
action taken pursuant to this Section 10 shall relieve any Selling
Shareholder so defaulting from liability, if any, in respect of such
default.
(b) Delay of Closing Dates. In the event of a default by any Selling
Shareholder as referred to in this Section 10, each of the Representatives
and the non-defaulting Selling Shareholders shall have the right to
postpone the Closing Date or the Option Closing Date, as the case may be,
for a period not exceeding seven days in order to effect any required
change in the Registration Statement or Prospectus or in any other
documents or arrangements.
(c) Default by the Company. If the Company shall fail at the Closing Date
or the Option Closing Date, as the case may be, to sell the number of
Shares that it is obligated to sell hereunder, then this Agreement shall
terminate without any liability on the part of any nondefaulting party;
provided, however, that the provisions of Sections 1, 5 and 8 shall remain
in full force and effect. No action taken pursuant to this Section 10
shall relieve the Company from liability, if any, in respect of such
default.
11. Notices.
All communications hereunder shall be in writing and, except as otherwise
provided herein, will be mailed, delivered, telecopied or telegraphed and
confirmed as follows: if to the Underwriters, to Alex. Xxxxx & Sons
Incorporated, Xxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, Attention: Syndicate;
with a copy to Alex. Xxxxx & Sons Incorporated, Xxx Xxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxx 00000, Attention: General Counsel; if to the Company or the Selling
Shareholders, to Xxxxxx Xxxxxx VisionCare, Inc., 000 Xxxx Xxxxxx Xxxxxx, Xxx
Xxxxxxx, Xxxxxxxx 00000; Attention: Chief Executive Officer; with a copy to
Xxxxxxxx & Xxxxx, 000 Xxxx Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, Attention:
Xxxxxx X. Xxxxx, Esq.
-30-
12. Termination.
(a) Termination; General. This Agreement may be terminated by you by
notice to the Sellers as follows:
(i) at any time prior to the Closing Date if any of the following has
occurred: (A) since the respective dates as of which information is given
in the Registration Statement and the Prospectus, any material adverse
change or any development involving a prospective material adverse change
in or affecting the condition, financial or otherwise, of the Company and
its Subsidiaries taken as a whole or the earnings, business, management,
properties, assets, rights, operations, condition (financial or otherwise)
or prospects of the Company and its Subsidiaries taken as a whole, whether
or not arising in the ordinary course of business; (B) any outbreak or
escalation of hostilities or declaration of war or national emergency or
other national or international calamity or crisis or change in economic or
political conditions if the effect of such outbreak, escalation,
declaration, emergency, calamity, crisis or change on the financial markets
of the United States would, in your reasonable judgment, make it
impracticable to market the Shares or to enforce contracts for the sale of
the Shares; (C) suspension of trading in securities generally on the New
York Stock Exchange or the American Stock Exchange or in the Nasdaq
National Market or limitation on prices (other than limitations on hours or
numbers of days of trading) for securities on either such exchange or the
Nasdaq National Market, or minimum or maximum prices for trading have been
fixed, or maximum ranges for prices have been required, by any of said
exchanges or by such system or by order of the Commission, the National
Association of Securities Dealers, Inc. or any other governmental
authority; (D) declaration of a banking moratorium by United States or New
York State authorities; (E) the suspension, or the material limitation, of
trading of the Company's common stock by the Commission on The Nasdaq
National Market; or (vii) the taking of any action by any governmental body
or agency in respect of its monetary or fiscal affairs which in your
reasonable opinion has a material adverse effect on the securities markets
in the United States; or
(ii) as provided in Sections 6, 9 and 10 of this Agreement.
13. Successors.
This Agreement has been and is made solely for the benefit of the
Underwriters, the Company, the Principal Operating Subsidiary and the Selling
Shareholders and their respective successors, executors, administrators, heirs
and assigns, and the officers, directors and controlling persons referred to
herein, and no other person will have any right or obligation hereunder. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the Underwriters, the Company
and the Principal Operating Subsidiary and their respective successors and the
controlling persons and officers and directors referred to in Sections 6 and 7
and their heirs and legal representatives, any legal or equitable right, remedy
or claim under or in respect of this Agreement or any provision herein
-31-
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the Underwriters, the Company and
the Principal Operating Subsidiary and their respective successors, and said
controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation.
No purchaser of any of the Shares from any Underwriter shall be deemed a
successor or assign merely because of such purchase.
14. Information Provided by Underwriters.
The Company, the Principal Operating Subsidiary, the Selling Shareholders
and the Underwriters acknowledge and agree that the only information furnished
or to be furnished by any Underwriter to the Company for inclusion in any
Prospectus or the Registration Statement consists of the information set forth
in the last paragraph on the front cover page of the Prospectus (insofar as such
information relates to the Underwriters), the legends required by Item 502(d) of
Regulation S-K under the 1933 Act on the inside front cover page of the
Prospectus, and the information under the caption "Underwriting" in the
Prospectus.
15. Miscellaneous.
(a) Survival of Agreements. The reimbursement, indemnification and
contribution agreements contained in this Agreement and the
representations, warranties and covenants in this Agreement or in
certificates of officers of the Company or any of its Subsidiaries
submitted pursuant hereto shall remain in full force and effect regardless
of (a) any termination of this Agreement, (b) any investigation made by or
on behalf of any Underwriter or controlling person thereof, or by or on
behalf of the Company or its directors or officers, and (c) delivery of and
payment for the Shares under this Agreement.
(b) Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. This Agreement shall
be governed by, and construed in accordance with, the laws of the State of
Maryland.
(c) Section Headings. The Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction
hereof.
-32-
If the foregoing letter is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company, the Principal
Operating Subsidiary, the Selling Shareholders and the several Underwriters in
accordance with its terms.
Very truly yours,
XXXXXX XXXXXX VISIONCARE, INC.
By:
--------------------------
Name:
Title:
XXXXXX XXXXXX CORPORATION
By:
--------------------------
Name:
Title:
-00-
XXXX XXXXXXX XXXX XX, X.X.
By: Xxxx Capital Partners IV, L.P.
Its General Partner
By: Xxxx Capital Investors, Inc.
Its General Partner
By:
--------------------------
Name:
Title: Managing Director
XXXX CAPITAL FUND IV-B, L.P.
By: Xxxx Capital Partners IV, L.P.
Its General Partner
By: Xxxx Capital Investors, Inc.
Its General Partner
By:
--------------------------
Name:
Title: Managing Director
BCIP ASSOCIATES
By:
--------------------------
Name:
Title: General Partner
BCIP TRUST ASSOCIATES, L.P.
By:
--------------------------
Name:
Title: General Partner
-34-
COMBINED JEWISH PHILANTHROPIES
By:
--------------------------
Name:
Title:
-35-
CORPORATION OF THE PRESIDENT OF
THE CHURCH OF XXXXX XXXXXX OF
LATTER DAY SAINTS
By:
--------------------------
Name:
Title:
-36-
FIDELITY INVESTMENTS CHARITABLE
GIFTS FUND
By:
--------------------------
Name:
Title:
-37-
BT INVESTMENT PARTNERS, INC.
By:
--------------------------
Name:
Title:
-38-
------------------------------
XXXXX X. XXXX
-39-
------------------------------
XXXXXX X. XXXXXX
-40-
The foregoing Underwriting Agreement is
hereby confirmed and accepted as of the
date first above written.
ALEX. XXXXX & SONS INCORPORATED
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Bear, Xxxxxxx & Co. Inc.
Salomon Brothers Inc
As Representatives of the several
Underwriters listed on Schedule I
By: Alex. Xxxxx & Sons Incorporated
By
--------------------------------
Name:
Title:
-41-
SCHEDULE I
Schedule of Underwriters
Number of
Firm Shares
Underwriter to be Purchased
Alex. Xxxxx & Sons Incorporated.............................
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated........................................
Bear, Xxxxxxx & Co. Inc. ...................................
Salomon Brothers Inc........................................
---------------
4,000,000
TOTAL UNDERWRITERS (__)
SCHEDULE II
Schedule of Option Shares
Number of
Option Shares
Underwriter to be Purchased
Alex. Xxxxx & Sons Incorporated.............................
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated........................................
Bear, Xxxxxxx & Co. Inc. ...................................
Salomon Brothers Inc........................................
---------------
600,000
TOTAL UNDERWRITERS (__)
SCHEDULE III
Schedule of Shares to be Sold by the Company
Number of Number of
Firm Shares Option Shares
To be Sold To be Sold
----------- -------------
500,000 0
----------- -------------
TOTAL 500,000 0
=========== =============
SCHEDULE IV
Schedule of Selling Shareholders
Number of Number of
Firm Shares Option Shares
Selling Shareholder To be Sold To be Sold
------------------- ---------- ----------
Xxxx Capital Fund IV, L.P.+
Xxxx Capital Fund IV-B, L.P.+
BCIP Trust Associates, L.P.+
BCIP Associates+
BT Investment Partners, Inc.+
Combined Jewish Philanthropies
Corporation of the President of the Church
of Xxxxx Xxxxxx of Latter Day Saints
Fidelity Investments Charitable Gifts Fund
Xxxxxx X. Xxxxxx*+
Xxxxx X. Xxxx*+
--------- -------
TOTAL 3,500,000 600,000
========= =======
----------------
*Management Selling Shareholders.
+Selling Shareholders who have granted an option to the Underwriters for the
sale of Option Shares. See Section 2(c).
SCHEDULE V
Schedule of Patents
SCHEDULE VI
Schedule of Persons and Entities
Subject to Lock-up
Xxxxx X. Xxxx
Xxxxxx X. Xxxxxx
Raleigh X. Xxxxxxxx
Xxxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxx
Xxxxxx X. Xxxx
Xxxxxx X. XxXxxxx
Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxxx
Xxxx X. Xxxxxx
Xxxx X. Xxxx
Xxxx X. X'Xxxxxx
Xxxx Capital Fund IV, X.X.
Xxxx Capital Fund IV-B, L.P.
BCIP Associates
BCIP Trust Associates, L.P.
BT Investment Partners, Inc.
Xxxxxxxx Street Partners
EXHIBIT 1
Form of Lock-Up Agreement
August __, 1997
Alex. Xxxxx & Sons Incorporated
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Bear, Xxxxxxx & Co. Inc.
Salomon Brothers Inc
As Representatives of the several
Underwriters to be named in the
within-mentioned Underwriting
Agreement
c/o Alex. Xxxxx & Sons Incorporated
Xxx Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Re: Proposed Public Offering by Xxxxxx Xxxxxx VisionCare, Inc.
----------------------------------------------------------
Ladies/Gentlemen:
The undersigned, a stockholder, director or executive officer of
Xxxxxx Xxxxxx VisionCare, Inc., a Delaware corporation (the "Company"),
understands that Alex. Xxxxx & Sons Incorporated ("Alex. Xxxxx"), Xxxxxxx Xxxxx
& Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, Bear, Xxxxxxx & Co.
Inc. and Salomon Brothers Inc propose to enter into an Underwriting Agreement
(the "Underwriting Agreement") with the Company providing for the public
offering of shares (the "Securities") of the Company's common stock, par value
$.01 per share (the "Common Stock").
In recognition of the benefit that such an offering will confer upon
the undersigned as a stockholder of the Company, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned agrees with each underwriter to be named in the Underwriting
Agreement that, during a period of 90 days from the date of the Underwriting
Agreement (the "Lock-Up Period"), the undersigned will not, without the prior
written consent of Alex. Xxxxx, directly or indirectly, (i) offer, pledge, sell,
contract to sell, sell short, sell any option or contract to purchase, purchase
any option or contract to sell, grant any option, right or warrant for the sale
of, or otherwise dispose of or transfer any shares of the Company's Common Stock
or any securities convertible into or exchangeable or exercisable for Common
Stock, whether now owned or hereafter acquired by the undersigned or with
respect to which the undersigned has or hereafter acquires the power of
disposition, or file any registration statement under the Securities Act of
1933, as amended, with respect to any of the foregoing or (ii) enter into any
swap or any other agreement or any transaction that transfers, in whole or in
part, directly or indirectly, any of the economic consequence of ownership of
the Common Stock, whether any such transaction is to be settled by delivery of
Common Stock or other securities, in cash or otherwise. In addition, the
undersigned agrees that, without the prior written consent of Alex. Xxxxx, the
undersigned will not, during the Lock-Up Period, make any demand for or exercise
any right with respect to the registration of any shares of Common Stock or any
security convertible into or exchangeable or exercisable for Common Stock.
Very truly yours,
BT INVESTMENT PARTNERS, INC.
By: ___________________________
Name:
Title:
EXHIBIT 2
Form of Opinion of
Counsel for the Company
Draft of August 15, 1997
XXXXXXXX & XXXXX LETTERHEAD
August __, 1997
Alex. Xxxxx & Sons Incorporated
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Bear, Xxxxxxx & Co. Inc.
Salomon Brothers Inc
As Representatives of the Several Underwriters
c/o Alex. Xxxxx & Sons Incorporated
Xxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Re: Xxxxxx Xxxxxx VisionCare, Inc.
------------------------------
Ladies and Gentlemen:
We are issuing this letter in our capacity as special counsel for
Xxxxxx Xxxxxx VisionCare, Inc. (the "Company") in response to the requirement in
Section 6(a)(ii)(A) of the Underwriting Agreement dated August __, 1997 (the
"Underwriting Agreement") among the Company, Xxxxxx Xxxxxx Corporation, a
Delaware corporation ("WJC"), certain selling stockholders named therein (the
"Selling Stockholders") and Alex. Xxxxx & Sons Incorporated and each of the
other underwriters named in Schedule I thereto (the "Underwriters"), relating to
the issuance, offer and sale by the Company of shares (the "Primary Shares") of
its common stock, par value $.01 per share ("Common Stock"), and the offer and
sale by the Selling Stockholders of shares (the "Secondary Shares," and,
together with the Primary Shares, the "Shares") of Common Stock owned by them.
Every term which is defined or given a special meaning in the Underwriting
Agreement and which is not given a different meaning in this letter has the same
meaning whenever it is used in this letter as the meaning it is given in the
Underwriting Agreement.
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 2
In connection with the preparation of this letter, we have among other
things read:
(a) the registration statement on Form S-1 (Registration No. 333-
32493), including all exhibits thereto, filed by the Company with
the Securities and Exchange Commission (the "Commission") on July
31, 1997 for the purpose of registering the offering of the Shares
under the Securities Act of 1933 (the "Securities Act") (which
registration statement, as amended by pre-effective Amendment No.
1 filed on August 12, 1997, and as further amended by pre-
effective Amendment No. 2 filed on August __, 1997, and as
constituted at the time it became effective is herein called the
"Registration Statement");
(b) the Company's prospectus dated August __, 1997 covering the
offering of the Shares through the Underwriters, in the form which
includes the initial offering price and related terms and which
was filed with the Commission on August __, 1997 pursuant to Rule
424(b)(1) under the Securities Act (which prospectus is herein
called the "Prospectus");
(c) an executed copy of the Underwriting Agreement;
(d) a specimen certificate for the Shares;
(e) A certified copy of resolutions adopted by the Company's Board of
Directors on July __, 1997; a certified copy of resolutions
adopted on August __, 1997 by the Pricing Committee of the Board
of Directors appointed in those Board resolutions and copies of
resolutions adopted by the Board of Directors of WJC on ________
__, 1997; and
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 3
(f) Copies of all certificates and other documents delivered today at
the closing of the purchase and sale of the Shares under the
Underwriting Agreement.
Subject to the assumptions, qualifications and limitations which are
identified in this letter, we advise you that:
1. The Company is a corporation duly organized, existing and in good standing
under the General Corporation Law of the State of Delaware. The Company is
qualified to do business and is in good standing in the State of Illinois.
2. Each of the Company's domestic subsidiaries listed on Exhibit A hereto
(collectively, the "Domestic Subsidiaries"), is a corporation existing and
in good standing under the laws of the State of Delaware; each Domestic
Subsidiary is qualified to transact business and is in good standing as a
foreign corporation in the States listed on Exhibit A attached hereto.
3. Each of the Company and each Domestic Subsidiary has the corporate power
and authority to own and lease its properties and to conduct its business
as described in the Prospectus.
4. All of the outstanding shares of capital stock of WJC have been duly
authorized and validly issued and are fully paid and nonassessable and,
based solely upon a review of the stock transfer records of each Domestic
Subsidiary, all of the outstanding shares of capital stock of each Domestic
Subsidiary are owned of record by the Company, either directly or through
one or more of the Domestic Subsidiaries.
5. All of the outstanding shares of Common Stock prior to the issuance of the
Primary Shares to be sold by the Company (including the Secondary Shares to
be sold by the Selling
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 4
Stockholders) have been duly authorized and validly issued and are fully
paid and non-assessable.
6. The Underwriting Agreement has been duly authorized, executed and delivered
by the Company and WJC.
7. The issuance of the Primary Shares to be sold on the date hereof pursuant
to the Underwriting Agreement has been duly authorized and when appropriate
certificates representing Primary Shares are duly countersigned by the
Company's transfer agent/registrar and delivered against payment of the
agreed consideration therefor in accordance with the Underwriting
Agreement, the Primary Shares will be validly issued, fully paid and
nonassessable. The issuance of the Primary Shares is not subject to any
preemptive rights under the terms of the statute under which the Company is
incorporated, under the Company's Certificate of Incorporation or under any
contractual provision of which we have knowledge.
8. The Company's authorized capital stock (including its authorized Common
Stock) is as set forth under the heading "Capitalization" in the Prospectus
and conforms in all material respects to the description of the terms
thereof contained under the heading "Description of Capital Stock" in the
Registration Statement and the Prospectus.
9. The execution and delivery of the Underwriting Agreement by the Company and
WJC, the performance of their obligations under the Underwriting Agreement
and the Company's issuance and sale of the Primary Shares to you in
accordance with the Underwriting Agreement do not (i) violate the Company's
or WJC's Certificate of Incorporation or Bylaws or (ii) constitute a
violation by the Company or WJC of any applicable provision of any law,
statute, regulation, ruling or court decrees applicable to the Company or
WJC or their properties (except that we express no opinion in this
paragraph as to compliance with any disclosure requirement or any
prohibition against fraud or misrepresentation or as to whether
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 5
performance of the indemnification or contribution provisions in
the Underwriting Agreement would be permitted) or (iii) breach, or
result in a default under, any existing obligation of the Company
or WJC under any of the agreements or forms of agreements filed as
any of the following exhibits to the Registration Statement
(provided that we express no opinion as to compliance with any
financial test or cross-default provision in any such agreement):
Exhibit Nos. 2.1, 2.2, 4.2 through 4.8, and 10.1 through 10.17
(except Exhibit 10.12, as to w hich we express no opinion).
10. We have no knowledge of any legal or governmental proceeding that
is pending or threatened against the Company or any Subsidiaries
that has caused us to conclude that such proceeding is required by
Item 103 of Regulation S-K to be described in the Registration
Statement or the Prospectus but that is not so described. We have
no knowledge of any contract or other document to which the
Company is a party or to which any of its property is subject that
has caused us to conclude that such contract is required to be
described in the Registration Statement or the Prospectus but is
not so described or is required to be filed as an exhibit to the
Registration Statement but has not been so filed.
11. The Company is not, and after giving effect to the offering and
the sale of the Primary Shares by the Company and the application
of the net proceeds thereof so described in the Prospectus, an
"investment company" as such term is defined in the Investment
Company Act of 1940, as amended.
12. A member of the Commission's staff has advised us by telephone
that the Commission has entered an order declaring the
Registration Statement effective under the Securities Act on
August __, 1997 (the "effective date") and we have no knowledge
that any stop order suspending its effectiveness has been issued
or that any proceedings for that purpose are pending before, or
overtly threatened by, the Commission.
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 6
13. To our knowledge, except as set forth in the Prospectus, no holder
of any security (debt or equity) of the Company has the right to
require the Company to register shares of Common Stock or any
other security of the Company under the Securities Act.
14. Neither the Company nor WJC was required to obtain any consent,
approval, authorization or order of any governmental agency or
body or, to our knowledge, any court for the issuance, delivery
and sale by the Company of the Primary Shares under the
Underwriting Agreement except for the order by the Commission
declaring the Registration Statement effective.
15. The information in the Registration Statement and the Prospectus
under the headings "Management-Employee Employment Agreements,"
"Management-Stock Options," "Management-Employee Stock Purchase
Plan," "Management-Non-Employee Director Stock Option Plan,"
"Management-Xxxxxx Xxxxxx Retirement Plan," "Certain Transactions-
Advisory Agreement," "Certain Transactions-Stockholders
Agreement," "Description of Certain Indebtedness" and "Shares
Eligible For Future Sale -Registration Agreement" and in Item 14
of Part II of the Registration Statement, to the extent that it
summarizes laws, governmental rules or regulations or documents is
correct in all material respects.
ooooooooo
The purpose of our professional engagement was not to establish
factual matters, and preparation of the Registration Statement involved many
determinations of a wholly or partially nonlegal character. We make no
representation that we have independently verified the accuracy, completeness or
fairness of the Prospectus or Registration Statement or that the actions taken
in connection with the preparation of the Registration Statement or Prospectus
(including the actions described in the next paragraph) were sufficient to cause
the Prospectus or Registration Statement
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 7
to be accurate, complete or fair. We are not passing upon and do not assume any
responsibility for the accuracy, completeness or fairness of the Prospectus or
the Registration Statement except to the extent otherwise explicitly indicated
in numbered paragraphs 8 and 15 above.
We can however confirm that we have participated in conferences with
representatives of the Company, representatives of the Underwriters, counsel for
the Underwriters and representatives of the independent accountants for the
Company during which disclosures in the Registration Statement and Prospectus
and related matters were discussed. In addition, we have reviewed certain
corporate records furnished to us by the Company. We were not retained by the
Company to prepare the periodic reports, proxy statements, or other materials
incorporated in the Prospectus or Registration Statement, and our knowledge
about these materials is limited.
Based upon our participation in the conferences and our document
review identified in the preceding paragraph, our understanding of applicable
law and the experience we have gained in our practice thereunder and relying as
to materiality to a large extent upon the opinions and statements of officers of
the Company, we can, however, advise you that nothing has come to our attention
that has caused us to conclude that (i) the Registration Statement at its
effective date contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or (ii) the Prospectus at the date it bears
and the date hereof contained or contains an untrue statement of a material fact
or omitted or omits to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading or (iii) as of the effective date, either the Registration
Statement or the Prospectus appeared on its face not to be responsive in all
material respects to the requirements of Form S-1.
ooooooooo
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 8
Except for the activities described in the immediately preceding
section of this letter, we have not undertaken any investigation to determine
the facts upon which the advice in this letter is based. We have not
undertaken any investigation or search of court records for purposes of this
letter.
We have assumed for purposes of this letter: each document we have
reviewed for purposes of this letter is accurate and complete, each such
document that is an original is authentic, each such document that is a copy
conforms to an authentic original, and all signatures on each such document are
genuine; that the Underwriting Agreement and every other agreement we have
examined for purposes of this letter constitutes a valid and binding obligation
of each party to that document and that each such party has satisfied all legal
requirements that are applicable to such party to the extent necessary to
entitle such party to enforce such agreement (except that we make no such
assumption with respect to the Company or WJC); and that you have acted in good
faith and without notice of any fact which has caused you to reach any
conclusion contrary to any of the conclusions provided in this letter. We have
also made other assumptions which we believe to be appropriate for purposes of
this letter.
In preparing this letter we have relied without independent
verification upon: (i) information contained in certificates obtained from
governmental authorities; (ii) factual information represented to be true in the
Underwriting Agreement and other documents specifically identified at the
beginning of this letter as having been read by us; (iii) factual information
provided to us by the Company or its representatives; and (iv) factual
information we have obtained from such other sources as we have deemed
reasonable. We have assumed that there has been no relevant change or
development between the dates as of which the information cited in the preceding
sentence was given and the date of this letter and that the information upon
which we have relied is accurate and does not omit disclosures necessary to
prevent such information from being misleading. We have not undertaken any
investigation to determine the facts upon which the advice in this
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 9
letter is based and have not undertaken any investigation or search of any
records of any court or any governmental agency or body for purposes of this
letter. For purposes of numbered paragraphs 1 and 2, we have relied exclusively
upon certificates issued by governmental authorities in the relevant
jurisdictions and such opinion is not intended to provide any conclusion or
assurance beyond that conveyed by those certificates.
We confirm that we do not have knowledge that has caused us to
conclude that our reliance and assumptions cited in the two immediately
preceding paragraphs are unwarranted. Whenever this letter provides advice
about (or based upon) our knowledge of any particular information or about any
information which has or has not come to our attention such advice is based
entirely on the conscious awareness at the time this letter is delivered on the
date it bears by the lawyers with Xxxxxxxx & Xxxxx at that time who spent
substantial time representing the Company in connection with the offering
effected pursuant to the Prospectus.
Our advice on every legal issue addressed in this letter is based
exclusively on the internal law of New York, the General Corporation Law of the
State of Delaware, the internal laws of the State of Illinois or the federal law
of the United States, and represents our opinion as to how that issue would be
resolved were it to be considered by the highest court in the jurisdiction which
enacted such law. We express no opinion with respect to any state securities
(or "blue sky") laws or regulations or any laws, statutes governmental rules or
regulations which in our experience are not applicable generally to transactions
of the kind covered by the Underwriting Agreement. None of the opinions or
other advice contained in this letter considers or covers (i) any financial
statements or supporting schedules (or any notes to any such statements or
schedules) or other financial or statistical information set forth or
incorporated by reference in (or omitted from) the Registration Statement or the
Prospectus or (ii) any rules and regulations of the National Association of
Securities Dealers, Inc. relating to the compensation of underwriters.
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 10
This letter speaks as of the time of its delivery on the date it
bears. We do not assume any obligation to provide you with any subsequent
opinion or advice by reason of any fact about which we did not have knowledge at
that time, by reason of any change subsequent to that time in any law other
governmental requirement or interpretation thereof covered by any of our
opinions or advice, or for any other reason.
This letter may be relied upon by the Underwriters only for the
purpose served by the provision in the Underwriting Agreement cited in the
initial paragraph of this letter in response to which it has been delivered.
Without our written consent: (i) no person other than the Underwriters may rely
on this letter for any purpose; (ii) this letter may not be cited or quoted in
any financial statement, prospectus, private placement memorandum or other
similar document; (iii) this letter may not be cited or quoted in any other
document or communication which might encourage reliance upon this letter by any
person or for any purpose excluded by the restrictions in this paragraph; and
(iv) copies of this letter may not be furnished to anyone for purposes of
encouraging such reliance.
XXXXXXXX & XXXXX
Exhibit A
---------
DOMESTIC SUBSIDIARIES
---------------------
State of
Name Incorporation Foreign Jurisdictions
---- ------------- ---------------------
Xxxxxx Xxxxxx Corporation Delaware Illinois
Xxxxxx Xxxxxx (Puerto Rico), Inc. Delaware Illinois, Puerto Rico
PBH, Inc. Delaware Georgia, California,
Ohio and Illinois
PBH International, Inc. Delaware None
Xxxxxx-Xxxx International, Inc. Delaware None
EXHIBIT 3
Form of Opinion of
Counsel for the Company
EXHIBIT 4
Form of Opinion of Intellectual
Property Counsel for the Company
EXHIBIT 5
Form of Opinion of Counsel
for the Selling Shareholders
Draft of August 15, 1997
------------------------
XXXXXXXX & XXXXX LETTERHEAD
August __, 1997
Alex. Xxxxx & Sons Incorporated
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Bear, Xxxxxxx & Co. Inc.
Salomon Brothers Inc
As Representatives of the Several Underwriters
c/o Alex. Xxxxx & Sons Incorporated
Xxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Re: Xxxxxx Xxxxxx VisionCare, Inc.
------------------------------
Ladies and Gentlemen:
We are issuing this letter in our capacity as special counsel for the
persons listed on Exhibit A to this letter (the "Selling Stockholders") in
response to the requirement in Section 6(a)(iv) of the Underwriting Agreement
dated August __, 1997 (the "Underwriting Agreement") between Xxxxxx Xxxxxx
VisionCare, Inc. (the "Company"), Xxxxxx Xxxxxx Corporation ("WJC"), the selling
stockholders named in Schedule II thereto and Alex. Xxxxx & Sons Incorporated
and each of the other underwriters named in Schedule I thereto (collectively,
the "Underwriters"). Every term which is defined or given a special meaning in
the Underwriting Agreement and which is not given a different meaning in this
letter has the same meaning whenever it is used in this letter as the meaning it
is given in the Underwriting Agreement. The shares of common stock previously
issued by the Company and being sold by the Selling Stockholders pursuant to the
Underwriting Agreement are called the "Selling Stockholder Shares" in this
opinion letter.
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 2
In connection with the preparation of this letter, we have among
other things read:
(a) an executed copy of the Underwriting Agreement;
(b) a specimen certificate for the Selling Stockholder Shares; and
(c) copies of all certificates and other documents delivered today
at the closing of the purchase and sale of the Selling
Stockholder Shares under the Underwriting Agreement.
Subject to the assumptions, qualifications and limitations which
are identified in this letter, we advise you that:
1. Each Selling Stockholder that is not a natural person is a partnership or
limited partnership existing and in good standing under the laws of the
jurisdiction of its organization.
2. The Underwriting Agreement has been duly executed and delivered by each of
the Selling Stockholders and, with respect to each Selling Stockholder that
is not a natural person, has been duly authorized by such Selling
Stockholder.
3. Each Selling Stockholder will be, immediately prior to the Closing Date,
the sole registered owner of the Selling Stockholder Shares to be sold by
such Selling Stockholder. Upon delivery of the Selling Stockholder Shares
to you against payment therefore as contemplated by the Underwriting
Agreement and registration of the Selling Stockholder Shares in your name
in the stock records of the Company, you will have acquired valid title to
such Selling Stockholder Shares, free and clear of all adverse claims. For
purposes of this opinion, we have assumed that you will have purchased the
Selling Stockholder Shares in good faith and without notice of
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 3
any adverse claim or defect in the validity of the Selling Stockholder
Shares and that you will take possession at the closing of the certificates
representing the Selling Stockholder Shares and the instruments pursuant to
which the Selling Stockholders have assigned the Selling Stockholder
Shares. The term "adverse claim" as used in this letter has the meaning
given such term in Article 8 of the Uniform Commercial Code as adopted in
the State of New York (the "UCC") does not include (i) any claim which
arises through you or any person claiming through you (such as any security
interest you may have granted in the Selling Stockholder Shares) and (ii)
any adverse interest which would not be extinguished upon the purchase of
the Selling Stockholder Shares by a person who qualifies as a "bona fide
purchaser" or "protected purchaser" under (S)8-303 of the UCC. We advise
you that we have no actual knowledge of the existence of any interest of
the kind specified in clause (ii) of the preceding sentence. We have also
assumed that your rights are not limited by subsection (4) of Section 8-302
of the UCC.
4. The execution and delivery of the Underwriting Agreement by the Selling
Stockholders, the performance of their obligations under the Underwriting
Agreement and the sales by them of the Selling Stockholder Shares to you in
accordance with the Underwriting Agreement do not (i) violate any of the
organizational documents of such Selling Stockholder (to the extent such
Selling Stockholder is not a natural person) or (ii) constitute a violation
by such Selling Stockholder of any applicable provision of any law,
statute, regulation, ruling or court decrees applicable to such Selling
Stockholder or its properties (except that we express no opinion in this
paragraph as to compliance with any disclosure requirement or any
prohibition against fraud or misrepresentation or as to whether performance
of the indemnification or contribution provisions in the Underwriting
Agreement would be permitted).
5. No Selling Stockholder was required to obtain any consent, approval,
authorization or order of any governmental agency or
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 4
body or, to our knowledge, any court for the delivery and sale of the
Selling Stockholder Shares under the Underwriting Agreement except for the
order by the Commission declaring the Registration Statement effective.
Except for the activities described in this letter, we have not
undertaken any investigation to determine the facts upon which the advice in
this letter is based. We have not undertaken any investigation or search of
court records for purposes of this letter.
We have assumed for purposes of this letter: each document we have
reviewed for purposes of this letter is accurate and complete, each such
document that is an original is authentic, each such document that is a copy
conforms to an authentic original, and all signatures on each such document are
genuine; that the Underwriting Agreement and every other agreement we have
examined for purposes of this letter constitutes a valid and binding obligation
of each party to that document and that each such party has satisfied all legal
requirements that are applicable to such party to the extent necessary to
entitle such party to enforce such agreement (except that we make no such
assumption with respect to the Selling Stockholders); and that you have acted in
good faith and without notice of any fact which has caused you to reach any
conclusion contrary to any of the conclusions provided in this letter. We have
also made other assumptions which we believe to be appropriate for purposes of
this letter.
In preparing this letter we have relied without independent
verification upon: (i) information contained in certificates obtained from
governmental authorities; (ii) factual information represented to be true in the
Underwriting Agreement and other documents specifically identified at the
beginning of this letter as having been read by us; (iii) factual information
provided to us by the Selling Stockholders or their representatives; and (iv)
factual information we have obtained from such other sources as we have deemed
reasonable. We have assumed that there has been no relevant change or
development
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 5
between the dates as of which the information cited in the preceding sentence
was given and the date of this letter and that the information upon which we
have relied is accurate and does not omit disclosures necessary to prevent such
information from being misleading. We have not undertaken any investigation to
determine the facts upon which the advice in this letter is based and have not
undertaken any investigation or search of any records of any court or any
governmental agency or body for purposes of this letter. For purposes of
numbered paragraph 1, we have relied exclusively upon certificates issued by
governmental authorities in the relevant jurisdictions and such opinion is not
intended to provide any conclusion or assurance beyond that conveyed by those
certificates.
We confirm that we do not have knowledge that has caused us to
conclude that our reliance and assumptions cited in the two immediately
preceding paragraphs are unwarranted. Whenever this letter provides advice
about (or based upon) our knowledge of any particular information or about any
information which has or has not come to our attention such advice is based
entirely on the conscious awareness at the time this letter is delivered on the
date it bears by the lawyers with Xxxxxxxx & Xxxxx at that time who spent
substantial time representing the Company in connection with the offering
effected pursuant to the Prospectus.
Our advice on every legal issue addressed in this letter is based
exclusively on the internal law of New York, the General Corporation Law of the
State of Delaware, the internal laws of the State of Illinois or the federal law
of the United States, and represents our opinion as to how that issue would be
resolved were it to be considered by the highest court in the jurisdiction which
enacted such law. We express no opinion with respect to any state securities
(or "blue sky") laws or regulations or any laws, statutes governmental rules or
regulations which in our experience are not applicable generally to transactions
of the kind covered by the Underwriting Agreement. None of the opinions or
other advice contained in this letter considers or covers any rules and
Alex. Xxxxx & Sons Incorporated
August __, 1997
Page 6
regulations of the National Association of Securities Dealers, Inc. relating to
the compensation of underwriters.
This letter speaks as of the time of its delivery on the date it
bears. We do not assume any obligation to provide you with any subsequent
opinion or advice by reason of any fact about which we did not have knowledge at
that time, by reason of any change subsequent to that time in any law other
governmental requirement or interpretation thereof covered by any of our
opinions or advice, or for any other reason.
This letter may be relied upon by you only for the purpose served by
the provision in the Underwriting Agreement cited in the initial paragraph of
this letter in response to which it has been delivered. Without our written
consent: (i) no person other than you may rely on this letter for any purpose;
(ii) this letter may not be cited or quoted in any financial statement,
prospectus, private placement memorandum or other similar document; (iii) this
letter may not be cited or quoted in any other document or communication which
might encourage reliance upon this letter by any person or for any purpose
excluded by the restrictions in this paragraph; and (iv) copies of this letter
may not be furnished to anyone for purposes of encouraging such reliance.
XXXXXXXX & XXXXX
EXHIBIT A
---------
SELLING STOCKHOLDERS
--------------------
Xxxx Capital Fund IV, X.X.
Xxxx Capital Fund IV-B, L.P.
BCIP Associates
BCIP Trust Associates, L.P.
Xxxxx X. Xxxx
Xxxxxx X. Xxxxxx
