EXHIBIT 1.1
4,500,000 Shares
GUESS ?, INC.
Common Stock
UNDERWRITING AGREEMENT
, 2000
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CIBC World Markets Corp.
PaineWebber Incorporated
Chase Securities Inc.
Xxxxxx Xxxxxxx Incorporated
Xxxxxx, Xxxxx Xxxxx Incorporated
c/o CIBC World Markets Corp.
00000 Xxxxxxxx Xxxx., 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
On behalf of the Several
Underwriters named on
Schedule I attached hereto.
Ladies and Gentlemen:
Guess ?, Inc., a Delaware corporation (the "Company"), proposes, subject
to the terms and conditions contained herein, to sell to you and the other
underwriters named on Schedule I to this Agreement (the "Underwriters"), for
whom you are acting as Representatives (the "Representatives"), an aggregate
of 4,500,000 shares (the "Firm Shares") of the Company's Common Stock, $0.01
par value (the "Common Stock"). The amounts of the Firm Shares to be
purchased by each of the several Underwriters are set forth opposite their
names on Schedule I hereto. In addition, the Company proposes to grant to the
Underwriters an option to purchase up to an additional 675,000 shares (the
"Option Shares") of Common Stock for the purpose of covering over-allotments
in connection with the sale of the Firm Shares. The Firm Shares and the
Option Shares are together called the "Shares."
1. SALE AND PURCHASE OF THE SHARES.
On the basis of the representations, warranties and agreements contained
in, and subject to the terms and conditions of this Agreement:
(a) The Company agrees to sell to each of the Underwriters, and each
of the Underwriters agrees, severally and not jointly, to purchase from
the Company, at a price of $_____ per share (the "Initial Price"), the
number of Firm Shares set forth opposite the name of such Underwriter
under the column "Number of Firm Shares to be Purchased" on Schedule I
to this Agreement, subject to adjustment in accordance with Section 10
hereof.
(b) The Company grants to the several Underwriters an option to
purchase, severally and not jointly, all or any part of the Option
Shares at the Initial Price. The number of Option Shares to be purchased
by each Underwriter shall be the same percentage (adjusted by the
Representatives to eliminate fractions) of the total number of Option
Shares to be purchased by the Underwriters as such Underwriter is
purchasing of the Firm Shares. Such option may be exercised only to
cover over-allotments in the sales of the Firm Shares by the
Underwriters and may be exercised in whole or in part at any time on or
before 12:00 noon, New York City time, on the business day before the
Firm Shares Closing Date (as defined below), and from time to time
thereafter within 30 days after the date of this Agreement, in each case
upon written, facsimile or telegraphic notice, or verbal or telephonic
notice confirmed by written, facsimile or telegraphic notice, by the
Representatives to the Company no later than 12:00 noon, New York City
time, on the business day before the Firm Shares Closing Date or at
least two business days before the Option Shares Closing Date (as
defined below), as the case may be, setting forth the number of Option
Shares to be purchased and the time and date (if other than the Firm
Shares Closing Date) of such purchase.
2. DELIVERY AND PAYMENT. Delivery by the Company of the Firm Shares to
the Representatives for the respective accounts of the Underwriters, and
payment of the purchase price by certified or official bank check or checks
payable in New York Clearing House (next day) funds drawn to the order of the
Company, against delivery of the respective certificates therefor to the
Representatives, shall take place at the offices of CIBC World Markets Corp.,
Xxx Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 a.m., New York
City time, on the third business day following the date of this Agreement, or
at such time on such other date, not later than 10 business days after the
date of this Agreement, as shall be agreed upon by the Company and the
Representatives (such time and date of delivery and payment are called the
"Firm Shares Closing Date").
If the option with respect to the Option Shares is exercised in whole or
in part on one or more occasions, delivery by the Company of the Option
Shares to the Representatives for the respective accounts of the Underwriters
and payment of the purchase price thereof in immediately available funds by
wire transfer or by certified or official bank check or checks payable in New
York Clearing House (next day) funds to the Company shall take place at the
offices of CIBC World Markets Corp. specified above at the time and on the
date (which may be the same date as, but in no event shall be earlier than,
the Firm Shares Closing Date) specified in
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the notice referred to in Section 1(b) (such time and date of delivery and
payment are called the "Option Shares Closing Date"). The Firm Shares Closing
Date and the Option Shares Closing Date are called, individually, a "Closing
Date" and, together, the "Closing Dates."
Certificates evidencing the Shares shall be registered in such names and
shall be in such denominations as the Representatives shall request at least
two full business days before the Firm Shares Closing Date or, in the case of
Option Shares, on the day of notice of exercise of the option as described in
Section l(b) and shall be made available to the Representatives for checking
and packaging, at such place as is designated by the Representatives, on the
full business day before the Firm Shares Closing Date (or the Option Shares
Closing Date in the case of the Option Shares).
3. REGISTRATION STATEMENT AND PROSPECTUS; PUBLIC OFFERING. The Company
has prepared and filed in conformity with the requirements of the Securities
Act of 1933, as amended (the "Securities Act"), and the published rules and
regulations thereunder (the "Rules") adopted by the Securities and Exchange
Commission (the "Commission"), a Registration Statement (as hereinafter
defined) on Form S-3 (No. 333-_____), including a preliminary prospectus
relating to the Shares, and such amendments thereof as may have been required
to the date of this Agreement. The Company has delivered to you copies of
such Registration Statement (including all amendments thereof) and of the
related Preliminary Prospectus (as hereinafter defined). The term
"Preliminary Prospectus" means any preliminary prospectus (as described in
Rule 430 of the Rules) included at any time as a part of the Registration
Statement or filed with the Commission by the Company with the consent of the
Representatives pursuant to Rule 424(a) of the Rules. The term "Registration
Statement" as used in this Agreement means the initial registration statement
(including all exhibits, financial schedules and information deemed to be a
part of the Registration Statement through incorporation by reference or
otherwise), as amended at the time and on the date it becomes effective (the
"Effective Date"), including the information (if any) deemed to be part
thereof at the time of effectiveness pursuant to Rule 430A of the Rules. If
the Company has filed an abbreviated registration statement to register
additional Shares pursuant to Rule 462(b) under the Rules (the "462(b)
Registration Statement"), then any reference herein to the Registration
Statement shall also be deemed to include such 462(b) Registration Statement.
The term "Prospectus" as used in this Agreement means the prospectus in the
form included in the Registration Statement at the time of effectiveness or,
if Rule 430A of the Rules is relied on, the term "Prospectus" shall also
include the final prospectus filed with the Commission pursuant to Rule
424(b) of the Rules.
The Company understands that the Underwriters propose to make a public
offering of the Shares, as set forth in and pursuant to the Prospectus, as
soon after the Effective Date and the date of this Agreement as the
Representatives deem advisable. The Company hereby confirms that the
Underwriters and dealers have been authorized to distribute or cause to be
distributed each Preliminary Prospectus and are authorized to distribute the
Prospectus (as from time to time amended or supplemented, if the Company
furnishes such amendments or supplements to the Underwriters).
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4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to each Underwriter as follows:
(a) On the Effective Date, the Registration Statement complied, and
on (i) the date of the Prospectus, (ii) the date any post-effective
amendment to the Registration Statement becomes effective, (iii) the
date any supplement or amendment to the Prospectus is filed with the
Commission and (iv) each Closing Date, the Registration Statement and
the Prospectus (and any amendment thereof or supplement thereto) will
comply with the applicable provisions of the Securities Act and the
Rules and the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and the rules and regulations of the Commission thereunder. As of
the Effective Date, the Registration Statement did not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein not misleading; and on the Effective Date and the
other dates referred to above, neither the Registration Statement nor
the Prospectus, nor any amendment thereof or supplement thereto, will
contain any untrue statement of a material fact or will omit to state
any material fact required to be stated therein or necessary in order to
make the statements therein not misleading. When any related preliminary
prospectus was first filed with the Commission (whether filed as part of
the Registration Statement or any amendment thereto or pursuant to Rule
424(a) of the Rules) and when any amendment thereof or supplement
thereto was first filed with the Commission, such preliminary
prospectus, as amended or supplemented, complied with the applicable
provisions of the Securities Act and the Rules, and did not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein not misleading. Notwithstanding the foregoing, none
of the representations and warranties in this paragraph 4(a) shall apply
to statements in, or omissions from, the Registration Statement or the
Prospectus made in reliance upon, and in conformity with, information
herein or otherwise furnished in writing by the Representatives on
behalf of the several Underwriters expressly for use in the Registration
Statement or the Prospectus. With respect to the preceding sentence, the
Company acknowledges that the only information furnished in writing by
the Representatives on behalf of the several Underwriters authorized for
use in the Registration Statement or the Prospectus are the statements
contained under the caption "Underwriting" in the Prospectus.
(b) The Registration Statement is effective under the Securities
Act, no stop order preventing or suspending the effectiveness of the
Registration Statement or suspending or preventing the use of the
Prospectus has been issued and no proceedings for that purpose have been
instituted or are threatened under the Securities Act. Any required
filing of the Prospectus and any supplement thereto pursuant to Rule
424(b) of the Rules has been or will be made in the manner and within
the time period required by such Rule 424(b).
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(c) The documents incorporated by reference in the Registration
Statement and the Prospectus, at the time they were filed with the
Commission, complied with the requirements of the Exchange Act and, when
read together and with the other information in the Registration
Statement and the Prospectus, do not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(d) The financial statements of the Company (including all notes and
schedules thereto) included or incorporated by reference in the
Registration Statement and Prospectus present fairly the financial
position, the results of operations, the statements of cash flows and
the statements of stockholders' equity and the other information
purported to be shown therein of the Company at the respective dates and
for the respective periods to which they apply; and such financial
statements and related schedules and notes have been prepared in
conformity with generally accepted accounting principles, consistently
applied throughout the periods involved, and all adjustments necessary
for a fair presentation of the results for such periods have been made.
The summary and selected financial data included in the Prospectus
present fairly the information shown therein as at the respective dates
and for the respective periods specified and the summary and selected
financial data have been presented on a basis consistent with the
consolidated financial statements so set forth in the Prospectus and
other financial information.
(e) KPMG LLP, whose reports are filed with the Commission as a part
of the Registration Statement, are and, during the periods covered by
their reports, were independent public accountants, as required by the
Securities Act and the Rules.
(f) The Company and each subsidiary or other entity controlled
directly or indirectly by the Company (collectively, "Subsidiaries") are
corporations duly organized, validly existing and in good standing under
the laws of their respective jurisdictions of incorporation. The Company
and each of its Subsidiaries are duly qualified to do business and is in
good standing as a foreign corporation in each jurisdiction in which the
nature of the respective business conducted or location of the
respective assets or properties owned, leased or licensed requires such
qualification, except for such jurisdictions where the failure to so
qualify would not have a material adverse effect, individually or in the
aggregate, on the assets or properties, business, results of operations
or financial condition of the Company (a "Material Adverse Effect"). The
Company and each of its Subsidiaries have all requisite corporate power
and authority, and all necessary authorizations, approvals, consents,
orders, licenses, certificates and permits of and from all governmental
or regulatory bodies or any other person or entity (collectively, the
"Permits"), to own, lease and license their respective assets and
properties and conduct their respective businesses, all of which are
valid
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and in full force and effect, as described in the Registration Statement
and the Prospectus, except where the lack of such Permits, individually
or in the aggregate, would not have a Material Adverse Effect. The
Company and each of its Subsidiaries have fulfilled and performed all of
their respective material obligations with respect to such Permits and
no event has occurred that allows, or after notice or lapse of time
would allow, revocation or termination thereof or results in any other
material impairment of the rights of the Company thereunder. Except as
may be required under the Securities Act and state and foreign Blue Sky
laws, no other Permits are required to enter into, deliver and perform
this Agreement and to issue and sell the Shares.
(g) The Company and each of its Subsidiaries own or possess adequate
and enforceable rights to use all trademarks, trademark applications,
trade names, service marks, copyrights, copyright applications,
licenses, intellectual property rights, know-how and other similar
rights and proprietary knowledge (collectively, "Intangibles") described
in the Prospectus as being owned by them necessary for the conduct of
their respective businesses. Neither the Company, nor any of its
Subsidiaries has received any notice of, nor is aware of, any
infringement of or conflict with asserted rights of others with respect
to any Intangibles.
(h) The Company and each of its Subsidiaries have good and
marketable title in fee simple to all items of real property and good
and marketable title to all personal property described in the
Prospectuses as being owned by them. Any real property and buildings
described in the Prospectuses as being held under lease by the Company
or any of its Subsidiaries is held by it under valid, existing and
enforceable leases, free and clear of all liens, encumbrances, claims,
security interests and defects, except such as (a) are described in the
Registration Statement and the Prospectus or (b) would not have a
Material Adverse Effect.
(i) There are no governmental proceedings or litigation to which
either the Company or its Subsidiaries is subject or which is pending
or, to the knowledge of the Company, threatened, against the Company or
any of its Subsidiaries, which, individually or in the aggregate, (a)
might have a Material Adverse Effect, (b) might affect the consummation
of this Agreement or (c) which is required to be disclosed in the
Registration Statement and the Prospectus that is not so disclosed.
(j) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as
described therein, (a) there has been no change that has had or could
reasonably be expected to have a Material Adverse Effect (a "Material
Adverse Change"); (b) neither the Company nor any of its Subsidiaries
has sustained any loss or interference with their respective assets,
businesses or properties (whether owned or leased) from fire, explosion,
earthquake, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or any court or legislative or
other governmental action, order or decree which
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would have a Material Adverse Effect; and (c) since the date of the
latest balance sheet included in the Registration Statement and the
Prospectus, except as reflected therein, neither the Company, nor its
Subsidiaries has (1) issued any securities or incurred any liability or
obligation, direct or contingent, for borrowed money, except such
liabilities or obligations incurred in the ordinary course of business,
(2) entered into any transaction not in the ordinary course of business
or (3) declared or paid any dividend or made any distribution on any
shares of its stock or redeemed, purchased or otherwise acquired or
agreed to redeem, purchase or otherwise acquire any shares of its stock.
(k) There is no document, contract or other agreement of a character
required to be described in the Registration Statement or Prospectus or
to be filed as an exhibit to the Registration Statement which is not
described or filed as required by the Securities Act or Rules. Each
description of a contract, document or other agreement in the
Registration Statement and the Prospectus accurately reflects in all
respects the terms of the underlying document, contract or agreement.
Each agreement described in the Registration Statement and Prospectus or
listed in the Exhibits to the Registration Statement or incorporated by
reference is in full force and effect and is valid and enforceable by
and against the Company or its Subsidiaries, as the case may be, in
accordance with its terms. Neither the Company nor any Subsidiary (if
such Subsidiary is a party) nor, to the Company's knowledge, any other
party is in default in the observance or performance of any term or
obligation to be performed by it under any such agreement, and no event
has occurred which with notice or lapse of time or both would constitute
such a default, in any such case which default or event, individually or
in the aggregate, would have a Material Adverse Effect. No default
exists, and no event has occurred which, with notice or lapse of time or
both, would constitute a default in the due performance and observance
of any term, covenant or condition by the Company or any Subsidiary (if
any such Subsidiary is a party thereto) of any other agreement or
instrument to which the Company or any Subsidiary is a party or by which
their respective properties or business may be bound or affected, which
default or event, individually or in the aggregate, would have a
Material Adverse Effect.
(l) Neither the Company nor any of its Subsidiaries is in violation
of any term or provision of their respective charters or by-laws or of
any franchise, license, permit, judgment, decree, order, statute, rule
or regulation (collectively "Law"), including, but not limited to any
applicable Law pertaining to United States immigration laws or United
States customs matters or any federal, state or local fair labor
practices, except where the consequences of such violation, individually
or in the aggregate, would not have a Material Adverse Effect.
(m) Neither the execution, delivery and performance of this
Agreement by the Company, nor the consummation of any of the
transactions contemplated hereby
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(including, without limitation, the issuance and sale by the Company of
the Shares) will give rise to a right to terminate or accelerate the due
date of any payment due under, or conflict with or result in the breach
of any term or provision of, or constitute a default (or an event which
with notice or lapse of time or both would constitute a default) under,
or require any consent or waiver under, or result in the execution or
imposition of any lien, charge or encumbrance upon any properties or
assets of the Company or its Subsidiaries pursuant to the terms of, any
indenture, mortgage, deed of trust or other agreement or instrument to
which the Company or any Subsidiary is a party or by which either the
Company or any Subsidiary or any of their respective properties or
businesses are bound, or any franchise, license, permit, judgment,
decree, order, statute, rule or regulation applicable to the Company or
any Subsidiary or violate any provision of the charter or by-laws of the
Company or any Subsidiary, except for such consents or waivers which
have already been obtained and are in full force and effect.
(n) The Company has authorized and outstanding capital stock as set
forth under the caption "Capitalization" in the Prospectus. The
certificates evidencing the Shares are in due and proper legal form and
have been duly authorized for issuance by the Company. All of the issued
and outstanding shares of Common Stock have been duly and validly issued
and are fully paid and nonassessable. There are no statutory preemptive
or other similar rights to subscribe for or to purchase or acquire any
shares of Common Stock of the Company or its Subsidiaries or any such
rights pursuant to their respective charters or by-laws or any agreement
or instrument to or by which the Company or any of its Subsidiaries is a
party or bound. The Shares, when issued and sold pursuant to this
Agreement, will be duly and validly issued, fully paid and nonassessable
and none of them will be issued in violation of any preemptive or other
similar right. Except as disclosed in the Registration Statement and the
Prospectus, there is no outstanding option, warrant or other right
calling for the issuance of, and there is no commitment, plan or
arrangement to issue, any share of stock of the Company or its
Subsidiaries or any security convertible into, or exercisable or
exchangeable for, such stock. The Common Stock and the Shares conform to
all statements in relation thereto contained in the Registration
Statement and the Prospectus. Unless otherwise disclosed in the
Prospectus, all outstanding shares of capital stock of each Subsidiary
have been duly authorized and validly issued, and are fully paid and
nonassessable and are owned directly by the Company or by another
wholly-owned subsidiary of the Company free and clear of any security
interests, liens, encumbrances, equities or claims.
(o) Other than as disclosed in the Registration Statement, no holder
of any security of the Company has the right to have any security owned
by such holder included in the Registration Statement or to demand
registration of any security owned by such holder during the period
ending 180 days after the date of this Agreement. Each stockholder,
director and executive officer of the Company listed on SCHEDULE II
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hereto has delivered to the Representatives his enforceable written
lock-up agreement in the form attached to this Agreement ("Lock-Up
Agreement").
(p) All necessary corporate action has been duly and validly taken
by the Company to authorize the execution, delivery and performance of
this Agreement and the issuance and sale of the Shares by the Company.
This Agreement has been duly and validly authorized, executed and
delivered by the Company and constitutes, and will constitute, a legal,
valid and binding obligation of the Company enforceable against the
Company in accordance with its terms, except as the enforceability
thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors'
rights generally and by general equitable principles.
(q) Neither the Company, nor any of its Subsidiaries is involved in
any labor dispute nor, to the knowledge of the Company, is any such
dispute threatened, which dispute would have a Material Adverse Effect.
The Company is not aware of any existing or imminent labor disturbance
by the employees of any of its principal suppliers or contractors which
would have a Material Adverse Effect. The Company is not aware of any
threatened or pending litigation between the Company or its Subsidiaries
and any of their respective executive officers which, if adversely
determined, could have a Material Adverse Effect and has no reason to
believe that such officers will not remain in the employment of the
Company or the Subsidiaries.
(r) No transaction has occurred between or among the Company and any
of its officers or directors, or any affiliate or affiliates of any such
officer or director that is required to be described in and is not so
described in the Registration Statement and the Prospectus.
(s) The Company has not taken, nor will it take, directly or
indirectly, any action designed to or which might reasonably be expected
to cause or result in, or which has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation
of the price of the Common Stock to facilitate the sale or resale of any
of the Shares.
(t) The Company and its Subsidiaries have filed all Federal, state,
local and foreign tax returns which are required to be filed through the
date hereof, or have received extensions thereof, and have paid all
taxes shown on such returns and all assessments received by it to the
extent that the same are material and have become due. There are no tax
audits or investigations pending, which, if adversely determined, would
have a Material Adverse Effect; nor are there any material proposed
additional tax assessments against the Company and any of its
Subsidiaries.
(u) The Shares have been duly authorized for quotation on the New
York
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Stock Exchange, Inc. A registration statement has been filed on Form 8-A
pursuant to Section 12 of the Exchange Act, which registration statement
complies with the Exchange Act.
(v) The books, records and accounts of the Company and its
Subsidiaries accurately and fairly reflect, in reasonable detail, the
transactions in, and dispositions of, the assets of, and the results of
operations of, the Company and its Subsidiaries. The Company and each of
its Subsidiaries maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management's general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally
accepted accounting principles and to maintain asset accountability,
(iii) access to assets is permitted only in accordance with management's
general or specific authorization and (iv) the recorded accountability
for assets is compared with the existing assets at reasonable intervals
and appropriate action is taken with respect to any differences.
(w) The Company and its Subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in
such amounts as are customary in the businesses in which they are
engaged or propose to engage after giving effect to the transactions
described in the Prospectus; all policies of insurance and fidelity or
surety bonds insuring the Company or any of its Subsidiaries or the
Company's or its Subsidiaries' respective businesses, assets, employees,
officers and directors are in full force and effect; the Company and
each of its Subsidiaries are in compliance with the terms of such
policies and instruments in all material respects; and neither the
Company nor any of its Subsidiaries has any reason to believe that it
will not be able to renew its existing insurance coverage as and when
such coverage expires or to obtain similar coverage from similar
insurers as may be necessary to continue its respective business at a
cost that would not have a Material Adverse Effect. Neither the Company
nor any Subsidiary has been denied any insurance coverage which it has
sought or for which it has applied.
(x) Each approval, consent, order, authorization, designation,
declaration or filing of, by or with any regulatory, administrative or
other governmental body necessary in connection with the execution and
delivery by the Company of this Agreement and the consummation of the
transactions herein contemplated required to be obtained or performed by
the Company (except as may be necessary to qualify the Shares for public
offering by the Underwriters under the state securities or Blue Sky
laws) has been obtained or made and is in full force and effect.
(y) (i) Each of the Company and its Subsidiaries is in compliance
with all rules, laws and regulation relating to the use, treatment,
storage and disposal of toxic substances and protection of health or the
environment ("Environmental Law") which are applicable to its business;
(ii) neither the Company, nor its Subsidiaries has received any notice
from any governmental authority or third party of an
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asserted claim under Environmental Laws; (iii) each of the Company and
its Subsidiaries has received all permits, licenses or other approvals
required of it under applicable Environmental Laws to conduct its
respective business and is in compliance with all terms and conditions
of any such permit, license or approval; (iv) to the Company's
knowledge, no facts currently exist that will require the Company or its
Subsidiaries to make future capital expenditures to comply with
Environmental Laws; and (v) no property which is or has been owned,
leased or occupied by the Company or its Subsidiaries has been
designated as a Superfund site pursuant to the Comprehensive
Environmental Response, Compensation of Liability Act of 1980, as
amended (42 U.S.C. Section 9601, et. seq.) ("CERCLA") or otherwise
designated as a contaminated site under applicable state or local law.
Neither the Company, nor any of its Subsidiaries has been named as a
"potentially responsible party" under the CERCLA.
(z) In the ordinary course of its business, the Company
periodically reviews the effect of Environmental Laws on the business,
operations and properties of the Company and its Subsidiaries, in the
course of which the Company identifies and evaluates associated costs
and liabilities (including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or compliance
with Environmental Laws, or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to
third parties). On the basis of such review, the Company has reasonably
concluded that such associated costs and liabilities would not, singly
or in the aggregate, have a Material Adverse Effect.
(aa) The Company is not and after giving effect to the offering and
sale of the Shares and the application of proceeds thereof as described
in the Prospectus, will not be an "investment company" within the
meaning of the Investment Company Act of 1940, as amended (the
"Investment Company Act").
(bb) None of the Company, nor its Subsidiaries, nor any of its
officers, employees, agents or any other person acting on behalf of the
Company or its Subsidiaries, has (i) directly or indirectly, given or
agreed to give any money, gift or similar benefit to any customer,
supplier, employee or agency of a customer or supplier, or official of
employee of any governmental agency (domestic or foreign) or
instrumentality of any government (domestic of foreign) or any political
party or candidate for office (domestic or foreign) or other person who
was, is, or may be in a position to help or hinder the business of the
Company or any of its Subsidiaries (or assist the Company or any of its
Subsidiaries with any actual or proposed transaction) which (A) might
subject the Company , or any other such person to any damage or penalty
in any civil, criminal or governmental litigation or proceeding
(domestic or foreign), (B) if not given in the past, might have had a
Material Adverse Effect, or (C) if not continued in the future, might
have a Material Adverse Effect; (ii) violated any provision of the
Foreign Corrupt Practices Act of 1977, as amended (the "FCPA"); or (iii)
made any other unlawful payment. The Company's internal accounting
controls
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are sufficient to cause the Company to comply with the FCPA.
(cc) There are no affiliations with the NASD among the Company's
officers, directors or, to the best of the knowledge of the Company, any
five percent or greater stockholder of the Company, except as set forth
in the Registration Statement or otherwise disclosed in writing to the
Representatives.
5. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS. The
obligations of the Underwriters under this Agreement are several and not joint.
The respective obligations of the Underwriters to purchase the Shares are
subject to each of the following terms and conditions:
(a) The Representatives shall have received Notification that the
Registration Statement has become effective and the Prospectus shall
have been timely filed with the Commission in accordance with Section
6(a) of this Agreement.
(b) No order preventing or suspending the use of any preliminary
prospectus or the Prospectus shall have been or shall be in effect, no
order suspending the effectiveness of the Registration Statement shall
be in effect, and no proceedings for such purpose shall be pending
before or threatened by the Commission. Any requests for additional
information on the part of the Commission (to be included in the
Registration Statement or the Prospectus or otherwise) shall have been
complied with to the satisfaction of the Commission and the
Representatives.
(c) The representations and warranties of the Company contained in
this Agreement and in the certificates delivered pursuant to Section
5(d) shall be true and correct when made and on and as of each Closing
Date, as if made on such date. The Company shall have performed all
covenants and agreements and satisfied all the conditions contained in
this Agreement required to be performed or satisfied by it at or before
such Closing Date.
(d) The Representatives shall have received, on each Closing Date, a
certificate, addressed to the Representatives and dated such Closing
Date, of the chief executive or chief operating officer and the chief
financial officer of the Company to the effect that (i) the signers of
such certificate have carefully examined the Registration Statement, the
Prospectus and this Agreement and that the representations and
warranties of the Company in this Agreement are true and correct on and
as of such Closing Date with the same effect as if made on such Closing
Date and the Company has performed all covenants and agreements and
satisfied all conditions contained in this Agreement required to be
performed or satisfied by it at or prior to such Closing Date, and (ii)
no stop order suspending the effectiveness of the Registration Statement
has been issued and to the best of their knowledge, no proceedings for
that purpose have been instituted or are pending under the Securities
Act.
(e) The Representatives shall have received, at the time this
Agreement is
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executed and on each Closing Date, a signed letter from KPMG LLP
addressed to the Representatives and dated, respectively, the date of
this Agreement and each such Closing Date, in form and substance
reasonably satisfactory to the Representatives, confirming that they are
independent accountants within the meaning of the Securities Act and the
Rules, that the response to Item 10 of the Registration Statement is
correct insofar as it relates to them and stating in effect that:
(i) in their opinion, the audited financial statements and financial
statement schedules included or incorporated by reference in the
Registration Statement and the Prospectus and reported on by them comply
as to form with the applicable accounting requirements of the Securities
Act and the Rules;
(ii) on the basis of a reading of the amounts included in the
Registration Statement and the Prospectus under the headings "Summary
Consolidated Financial Information" and "Selected Consolidated Financial
Data" carrying out certain procedures (but not an examination in
accordance with Generally Accepted Auditing Standards ("GAAS")) which
would not necessarily reveal matters of significance with respect to the
comments set forth in such letter, a reading of the minutes of the
meetings of the stockholders and directors of the Company, and inquiries
of certain officials of the Company who have responsibility for
financial and accounting matters of the Company as to transactions and
events subsequent to the date of the latest audited financial
statements, except as disclosed in the Registration Statement and the
Prospectus, nothing came to their attention which caused them to believe
that:
(A) the amounts in "Summary Consolidated Financial Information"
and "Selected Consolidated Financial Data" included in the
Registration Statement and the Prospectus do not agree with the
corresponding amounts in the audited and unaudited financial
statements from which such amounts were derived; or
(B) with respect to the Company, there were, at a specified
date not more than three business days prior to the date of the
letter, any increases in the current liabilities and long-term
liabilities of the Company or any decreases in net income or in
working capital or the stockholders' equity in the Company, as
compared with the amounts shown on the Company's audited balance
sheet for the fiscal year ended December 31, 1999 included in the
Registration Statement;
(iii) they have performed certain other procedures as may be
permitted under GAAS, as a result of which they determined that certain
information of an accounting, financial or statistical nature (which is
limited to accounting, financial or statistical information derived from
the general accounting records of the Company) set forth in the
Registration Statement and
-13-
the Prospectus and reasonably specified by the Representatives agrees
with the accounting records of the Company; and
(iv) based upon the procedures set forth in clauses (ii) and (iii)
above and a reading of the amounts included in the Registration
Statement under the headings "Summary Consolidated Financial
Information" and "Selected Consolidated Financial Data" included in the
Registration Statement and Prospectus and a reading of the financial
statements from which certain of such data were derived, nothing has
come to their attention that gives them reason to believe that the
"Summary Consolidated Financial Information" and "Selected Consolidated
Financial Data" included in the Registration Statement and Prospectus do
not comply as to the form with the applicable accounting requirements of
the Securities Act and the Rules or that the information set forth
therein is not fairly stated in relation to the financial statements
included in the Registration Statement or Prospectus from which certain
of such data were derived are not in conformity with GAAS applied on a
basis substantially consistent with that of the audited financial
statements included in the Registration Statement and Prospectus.
References to the Registration Statement and the Prospectus in this
paragraph (e) are to such documents as amended and supplemented at the
date of the letter.
(f) All proceedings taken in connection with the sale of the Firm
Shares and the Option Shares as herein contemplated shall be reasonably
satisfactory in form and substance to the Representatives, and their
counsel and the Underwriters shall have received from Skadden, Arps,
Slate, Xxxxxxx & Xxxx LLP, and such other counsel of the Company as the
Underwriters may reasonably request, a favorable opinion, addressed to the
Representatives and dated such Closing Date, with respect to the Shares,
the Registration Statement and the Prospectus, and such other related
matters, as the Representatives may reasonably request, and the Company
shall have furnished to Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, and
such other counsel of the Company as the Underwriters may reasonably
request, such documents as they may reasonably request for the purpose of
enabling them to pass upon such matters.
(g) The Representatives shall have received copies of the Lock-up
Agreements executed by each entity or person described in Section 4(o).
(h) The Company shall have furnished or caused to be furnished to
the Representatives such further certificates or documents as the
Representatives shall have reasonably requested.
6. COVENANTS OF THE COMPANY.
(a) The Company covenants and agrees as follows:
(i) The Company will use its best efforts to cause
the Registration
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Statement, if not effective at the time of execution of
this Agreement, and any amendments thereto, to become
effective as promptly as possible. The Company shall
prepare the Prospectus in a form approved by the
Representatives and file such Prospectus pursuant to
Rule 424(b) under the Securities Act not later than the
Commission's close of business on the second business
day following the execution and delivery of this
Agreement, or, if applicable, such earlier time as may
be required by Rule 430A(a)(3) under the Securities Act.
(ii) The Company shall promptly advise the Representatives
in writing (a) when any amendment to the Registration
Statement shall have become effective, (b) of any
request by the Commission for any amendment of the
Registration Statement or the Prospectus or for any
additional information, (c) of the prevention or
suspension of the use of any preliminary prospectus or
the Prospectus or of the issuance by the Commission of
any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening
of any proceeding for that purpose and (d) of the
receipt by the Company of any notification with respect
to the suspension of the qualification of the Shares for
sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose. The
Company shall not file any amendment of the Registration
Statement or supplement to the Prospectus unless the
Company has furnished the Representatives a copy for its
review prior to filing, and shall not file any such
proposed amendment or supplement to which the
Representatives reasonably object. The Company shall use
its best efforts to prevent the issuance of any such
stop order and, if issued, to obtain as soon as possible
the withdrawal thereof.
(iii) If, at any time when a prospectus relating to the
Shares is required to be delivered under the Securities
Act and the Rules, any event occurs as a result of which
the Prospectus as then amended or supplemented would
include any untrue statement of a material fact or omit
to state any material fact necessary to make the
statements therein in the light of the circumstances
under which they were made not misleading, or if it
shall be necessary to amend or supplement the Prospectus
to comply with the Securities Act or the Rules, the
Company promptly shall prepare and file with the
Commission, subject to the second sentence of paragraph
(ii) of this Section 6(a), an amendment or supplement
which shall correct such statement or omission or an
amendment which shall effect such compliance.
(iv) The Company shall make generally available to its
security holders and to the Representatives as soon as
practicable, but not later than 45 days after the end of
the 12-month period beginning at the end of the fiscal
quarter of the Company during which the Effective Date
occurs (or 90 days if such 12-month period coincides
with the Company's fiscal year), an earning statement
(which need not be audited) of the Company, covering
such
-15-
12-month period, which shall satisfy the provisions of
Section 11(a) of the Securities Act or Rule 158 of the
Rules.
(v) The Company shall furnish to the
Representatives and counsel for the Underwriters, without
charge, signed copies of the Registration Statement
(including all exhibits thereto and amendments thereof)
and to each other Underwriter a copy of the Registration
Statement (without exhibits thereto) and all amendments
thereof and, so long as delivery of a prospectus by an
Underwriter or dealer may be required by the Securities
Act or the Rules, as many copies of any preliminary
prospectus and the Prospectus and any amendments thereof
and supplements thereto as the Representatives may
reasonably request.
(vi) The Company shall cooperate with the
Representatives and their counsel in endeavoring to
qualify the Shares for offer and sale in connection with
the offering under the laws of such jurisdictions as the
Representatives may designate and shall maintain such
qualifications in effect so long as required for the
distribution of the Shares; provided, however, that the
Company shall not be required in connection therewith, as
a condition thereof, to qualify as a foreign corporation
or to execute a general consent to service of process in
any jurisdiction or subject itself to taxation as doing
business in any jurisdiction.
(vii) Without the prior written consent of the
Representatives, for a period 90 days after the date of
this Agreement, the Company and each of its individual
directors and executive officers shall not issue, sell or
register with the Commission (other than on Form S-8 or on
any successor form), or otherwise dispose of, directly or
indirectly, any equity securities of the Company (or any
securities convertible into, exercisable for or
exchangeable for equity securities of the Company), except
for the issuance of the Shares pursuant to the
Registration Statement and the issuance of shares pursuant
to the Company's existing stock option plan or bonus plan
as described in the Registration Statement and the
Prospectus. In the event that during this period, (i) any
shares are issued pursuant to the Company's existing stock
option plan or bonus plan that are exercisable during such
90 day period or (ii) any registration is effected on Form
S-8 or on any successor form relating to shares that are
exercisable during such 90 period, the Company shall
obtain the written agreement of such grantee or purchaser
or holder of such registered securities that, for a period
of 90 days after the date of this Agreement, such person
will not, without the prior written consent of the
Representatives, offer for sale, sell, distribute, grant
any option for the sale of, or otherwise dispose of,
directly or indirectly, or exercise any registration
rights with respect to, any shares of Common Stock (or any
securities convertible into, exercisable for, or
exchangeable for any shares of Common Stock) owned by such
person.
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(viii) On or before completion of this offering,
the Company shall make all filings required under
applicable securities laws and by the New York Stock
Exchange, Inc. (including any required registration under
the Exchange Act).
(ix) The Company will apply the net proceeds from
the offering of the Shares in the manner set forth under
"Use of Proceeds" in the Prospectus.
(b) The Company agrees to pay, or reimburse if paid by the
Representatives, whether or not the transactions contemplated
hereby are consummated or this Agreement is terminated, all costs
and expenses incident to the public offering of the Shares and the
performance of the obligations of the Company under this Agreement
including those relating to: (i) the preparation, printing, filing
and distribution of the Registration Statement including all
exhibits thereto, each preliminary prospectus, the Prospectus, all
amendments and supplements to the Registration Statement and the
Prospectus, and the printing, filing and distribution of this
Agreement; (ii) the preparation and delivery of certificates for
the Shares to the Underwriters; (iii) the registration or
qualification of the Shares for offer and sale under the
securities or Blue Sky laws of the various jurisdictions referred
to in Section 6(a)(vi), including the reasonable fees and
disbursements of counsel for the Underwriters in connection with
such registration and qualification and the preparation, printing,
distribution and shipment of preliminary and supplementary Blue
Sky memoranda; (iv) the furnishing (including costs of shipping
and mailing) to the Representatives and to the Underwriters of
copies of each preliminary prospectus, the Prospectus and all
amendments or supplements to the Prospectus, and of the several
documents required by this Section to be so furnished, as may be
reasonably requested for use in connection with the offering and
sale of the Shares by the Underwriters or by dealers to whom
Shares may be sold; (v) the filing fees of the NASD in connection
with its review of the terms of the public offering and reasonable
fees and disbursements of counsel for the Underwriters in
connection with such review; (vi) inclusion of the Shares for
quotation on the New York Stock Exchange, Inc.; and (vii) all
transfer taxes, if any, with respect to the sale and delivery of
the Shares by the Company to the Underwriters. Subject to the
provisions of Section 9, the Underwriters agree to pay, whether or
not the transactions contemplated hereby are consummated or this
Agreement is terminated, all costs and expenses incident to the
performance of the obligations of the Underwriters under this
Agreement not otherwise payable by the Company pursuant to the
preceding sentence, including, without limitation, the fees and
disbursements of counsel for the Underwriters.
7. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act against any and all losses, claims, damages
and liabilities, joint or several (including any reasonable
-17-
investigation, legal and other expenses incurred in connection
with, and any amount paid in settlement of, any action, suit or
proceeding or any claim asserted), to which they, or any of them,
may become subject under the Securities Act, the Exchange Act or
other Federal or state law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities
arise out of or are based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in any preliminary
prospectus, the Registration Statement or the Prospectus or any
amendment thereof or supplement thereto, or in any Blue Sky
application or other information or other documents executed by
the Company filed in any state or other jurisdiction to qualify
any or all of the Shares under the securities laws thereof (any
such application, document or information being hereinafter
referred to as a "Blue Sky Application") or arise out of or are
based upon any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make
the statements therein not misleading, (ii) in whole or in part
upon any breach of the representations and warranties set forth in
Section 4 hereof, or (iii) in whole or in part upon any failure of
the Company to perform any of its obligations hereunder or under
law; provided, however, that such indemnity shall not inure to the
benefit of any Underwriter (or any person controlling such
Underwriter) on account of any losses, claims, damages or
liabilities arising from the sale of the Shares to any person by
such Underwriter if such untrue statement or omission or alleged
untrue statement or omission was made in such preliminary
prospectus, the Registration Statement or the Prospectus, or such
amendment or supplement thereto, or in any Blue Sky Application in
reliance upon and in conformity with information furnished in
writing to the Company by the Representatives on behalf of any
Underwriter expressly authorized by such Underwriter for use
therein. This indemnity agreement will be in addition to any
liability which the Company may otherwise have.
(b) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company and each person, if any,
who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, each director of
the Company, and each officer of the Company who signs the
Registration Statement, to the same extent as the foregoing
indemnity from the Company to each Underwriter, but only insofar as
such losses, claims, damages or liabilities arise out of or are
based upon any untrue statement or omission or alleged untrue
statement or omission which was made in any preliminary prospectus,
the Registration Statement or the Prospectus, or any amendment
thereof or supplement thereto, contained in the (i) concession and
reallowance figures appearing under the caption "Underwriting" and
(ii) the stabilization information contained under the caption
"Underwriting" in the Prospectus; PROVIDED, HOWEVER, that the
obligation of each Underwriter to indemnify the Company (including
any controlling person, director or officer thereof) shall be
limited to the net proceeds received by the Company from such
Underwriter.
(c) Any party that proposes to assert the right to be
indemnified under this Section will, promptly after receipt of
notice of commencement of any action, suit or
-18-
proceeding against such party in respect of which a claim is to
be made against an indemnifying party or parties under this
Section, notify each such indemnifying party of the commencement
of such action, suit or proceeding, enclosing a copy of all
papers served. No indemnification provided for in Section 7(a)
or 7(b) shall be available to any party who shall fail to give
notice as provided in this Section 7(c) if the party to whom
notice was not given was unaware of the proceeding to which such
notice would have related and was prejudiced by the failure to
give such notice, but the omission so to notify such
indemnifying party of any such action, suit or proceeding shall
not relieve it from any liability that it may have to any
indemnified party for contribution or otherwise than under this
Section. In case any such action, suit or 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 in, and, to the extent
that it shall wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel
reasonably satisfactory to such indemnified party, and after
notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof and the approval
by the indemnified party of such counsel, the indemnifying party
shall not be liable to such indemnified party for any legal or
other expenses, except as provided below and except for the
reasonable costs of investigation subsequently incurred by such
indemnified party in connection with the defense thereof. The
indemnified party shall have the right to employ its counsel in
any such action, but the fees and expenses of such counsel shall
be at the expense of such indemnified party unless (i) the
employment of counsel by such indemnified party has been
authorized in writing by the indemnifying parties, (ii) the
indemnified party shall have been advised by counsel that there
may be one or more legal defenses available to it which are
different from or in addition to those available to the
indemnifying party (in which case the indemnifying parties shall
not have the right to direct the defense of such action on
behalf of the indemnified party) or (iii) the indemnifying
parties shall not have employed counsel to assume the defense of
such action within a reasonable time after notice of the
commencement thereof, in each of which cases the fees and
expenses of counsel shall be at the expense of the indemnifying
parties. An indemnifying party shall not be liable for any
settlement of any action, suit, proceeding or claim effected
without its written consent, which consent shall not be
unreasonably withheld or delayed.
8. CONTRIBUTION. In order to provide for just and
equitable contribution in circumstances in which the
indemnification provided for in Section 7(a) or 7(b) is due in
accordance with its terms but for any reason is held to be
unavailable to or insufficient to hold harmless an indemnified
party under Section 7(a) or 7(b), then each indemnifying party
shall contribute to the aggregate losses, claims, damages and
liabilities (including any investigation, legal and other expenses
reasonably incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claims
asserted, but after deducting any contribution received by any
person entitled hereunder to contribution from any person who may
be liable for contribution) to which the indemnified party may be
subject in such proportion as is appropriate to
-19-
reflect the relative benefits received by the Company, on the
one hand, and the Underwriters, on the other, from the offering
of the Shares or, if such allocation is not permitted by
applicable law or indemnification is not available as a result
of the indemnifying party not having received notice as provided
in Section 7 hereof, in such proportion as is appropriate to
reflect not only the relative benefits referred to above, but
also the relative fault of the Company, on the one hand, and the
Underwriters, on the other, in connection with the statements or
omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable
considerations. The relative benefits received by the Company
and the Underwriters shall be deemed to be in the same
proportion as (x) the total proceeds from the offering (net of
underwriting discounts, but before deducting expenses) received
by the Company, as set forth in the table on the cover page of
the Prospectus, bear to (y) the underwriting discounts received
by the Underwriters, as set forth in the table on the cover page
of the Prospectus. The relative fault of the Company or the
Underwriters shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a
material fact related to information supplied by the Company or
the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such
statement or omission. The Company and the Underwriters agree
that it would not be just and equitable if contribution pursuant
to this Section 8 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.
Notwithstanding the provisions of this Section 8, (i) in no case
shall any Underwriter (except as may be provided in the
Agreement Among Underwriters) be liable or responsible for any
amount in excess of the underwriting discount applicable to the
Shares purchased by such Underwriter hereunder; (ii) the Company
shall be liable and responsible for any amount in excess of such
underwriting discount; provided, however, that no person guilty
of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 8, each person,
if any, who controls an Underwriter within the meaning of
Section 15 of the Securities Act or Section 20(a) of the
Exchange Act shall have the same rights to contribution as such
Underwriter, and each person, if any, who controls the Company
within the meaning of the Section 15 of the Securities Act or
Section 20(a) of the Exchange Act, each officer of the Company
who shall have signed the Registration Statement and each
director of the Company shall have the same rights to
contribution as the Company, subject in each case to clauses (i)
and (ii) in the immediately preceding sentence of this Section
8. Any party entitled to contribution will, promptly after
receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim for
contribution may be made against another party or parties under
this Section 8, notify such party or parties from whom
contribution may be sought, but the omission so to notify such
party or parties from whom contribution may be sought shall not
relieve the party or parties from whom contribution may be
sought from any other obligation it or they may have hereunder
or otherwise than under this Section 8. No party shall be liable
for
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contribution with respect to any action, suit, proceeding or
claim settled without its written consent. The Underwriter's
obligations to contribute pursuant to this Section 8 are several
in proportion to their respective underwriting commitments and
not joint.
9. TERMINATION. This Agreement may be terminated with respect to the
Shares to be purchased on a Closing Date by the Representatives by notifying
the Company at any time:
(a) in the absolute discretion of the Representatives at or before any
Closing Date: (i) if on or prior to such date, any domestic or
international event or act or occurrence has materially disrupted, or in
the opinion of the Representatives will in the future materially disrupt,
the securities markets; (ii) if there has occurred any new outbreak or
material escalation of hostilities or other calamity or crisis the effect
of which on the financial markets of the United States is such as to make
it, in the judgment of the Representatives, inadvisable to proceed with
the offering; (iii) if there shall be such a material adverse change in
general financial, political or economic conditions or the effect of
international conditions on the financial markets in the United States is
such as to make it, in the judgment of the Representatives, inadvisable or
impracticable to market the Shares; (iv) if trading in the Shares has been
suspended by the Commission or trading generally on the New York Stock
Exchange, Inc., on the American Stock Exchange, Inc. or the Nasdaq
National Market has been suspended or limited, or minimum or maximum
ranges for prices for securities shall have been fixed, or maximum ranges
for prices for securities have been required, by said exchanges or by
order of the Commission, the National Association of Securities Dealers,
Inc., or any other governmental or regulatory authority; or (v) if a
banking moratorium has been declared by any state or Federal authority; or
(vi) if, in the judgment of the Representatives, there has occurred a
Material Adverse Effect, or
(b) at or before any Closing Date, that any of the conditions specified
in Section 5 shall not have been fulfilled when and as required by this
Agreement.
If this Agreement is terminated pursuant to any of its provisions, the
Company shall not be under any liability to any Underwriter, and no
Underwriter shall be under any liability to the Company, except that (i) if
this Agreement is terminated by the Representatives or the Underwriters
because of any failure, refusal or inability on the part of the Company to
comply with the terms or to fulfill any of the conditions of this Agreement,
the Company will reimburse the Underwriters for all out-of-pocket expenses
(including the reasonable fees and disbursements of their counsel) incurred
by them in connection with the proposed purchase and sale of the Shares or in
contemplation of performing their obligations hereunder and (ii) no
Underwriter who shall have failed or refused to purchase the Shares agreed to
be purchased by it under this Agreement, without some reason sufficient
hereunder to justify cancellation or termination of its obligations under
this Agreement, shall be relieved of liability to the Company or to the other
Underwriters for damages occasioned by its failure or refusal.
10. SUBSTITUTION OF UNDERWRITERS. If one or more of the Underwriters
shall
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fail (other than for a reason sufficient to justify the cancellation or
termination of this Agreement under Section 9) to purchase on any Closing
Date the Shares agreed to be purchased on such Closing Date by such
Underwriter or Underwriters, the Representatives may find one or more
substitute underwriters to purchase such Shares or make such other
arrangements as the Representatives may deem advisable; or one or more of the
remaining Underwriters may agree to purchase such Shares in such proportions
as may be approved by the Representatives, in each case upon the terms set
forth in this Agreement. If no such arrangements have been made by the close
of business on the business day following such Closing Date:
(a) if the number of Shares to be purchased by the defaulting
Underwriters on such Closing Date shall not exceed 10% of the Shares that
all the Underwriters are obligated to purchase on such Closing Date, then
each of the nondefaulting Underwriters shall be obligated to purchase such
Shares on the terms herein set forth in proportion to their respective
obligations hereunder; PROVIDED, that in no event shall the maximum number
of Shares that any Underwriter has agreed to purchase pursuant to Section
1 be increased pursuant to this Section 10 by more than [one-ninth] of
such number of Shares without the written consent of such Underwriter, or
(b) if the number of Shares to be purchased by the defaulting
Underwriters on such Closing Date shall exceed 10% of the Shares that all
the Underwriters are obligated to purchase on such Closing Date, then the
Company shall be entitled to one additional business day within which it
may, but is not obligated to, find one or more substitute underwriters
reasonably satisfactory to the Representatives to purchase such Shares
upon the terms set forth in this Agreement.
In any such case, either the Representatives or the Company shall have
the right to postpone the applicable Closing Date for a period of not more
than five business days in order that necessary changes and arrangements
(including any necessary amendments or supplements to the Registration
Statement or Prospectus) may be effected by the Representatives and the
Company. If the number of Shares to be purchased on such Closing Date by such
defaulting Underwriter or Underwriters shall exceed 10% of the Shares that
all the Underwriters are obligated to purchase on such Closing Date, and none
of the nondefaulting Underwriters or the Company shall make arrangements
pursuant to this Section within the period stated for the purchase of the
Shares that the defaulting Underwriters agreed to purchase, this Agreement
shall terminate with respect to the Shares to be purchased on such Closing
Date without liability on the part of any nondefaulting Underwriter to the
Company and without liability on the part of the Company, except in both
cases as provided in Sections 6(b), 7, 8 and 9. The provisions of this
Section shall not in any way affect the liability of any defaulting
Underwriter to the Company or the nondefaulting Underwriters arising out of
such default. A substitute underwriter hereunder shall become an Underwriter
for all purposes of this Agreement.
11. MISCELLANEOUS. The respective agreements, representations,
warranties, indemnities and other statements of the Company or its officers,
and of the Underwriters set forth in or made pursuant to this Agreement shall
remain in full force and effect, regardless of any investigation made by or
on behalf of any Underwriter or the Company or any of the officers,
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directors or controlling persons referred to in Sections 7 and 8 hereof, and
shall survive delivery of and payment for the Shares. The provisions of
Sections 6(b), 7, 8 and 9 shall survive the termination or cancellation of
this Agreement.
This Agreement has been and is made for the benefit of the Underwriters,
the Company and their respective successors and assigns, and, to the extent
expressed herein, for the benefit of persons controlling any of the
Underwriters, or the Company, and directors and officers of the Company, and
their respective successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. The term "successors and
assigns" shall not include any purchaser of Shares from any Underwriter
merely because of such purchase.
All notices and communications hereunder shall be in writing and mailed
or delivered or by telephone or telegraph if subsequently confirmed in
writing, (a) if to the Representatives, c/o CIBC World Markets Corp., 00000
Xxxxxxxx Xxxx., Xxx Xxxxxxx, XX 00000 Attention: Xxxxxx X. Xxxxxx, with a
copy to Xxxxxxxx X. Layne, Gibson, Xxxx & Xxxxxxxx LLP, 000 Xxxxx Xxxxx, Xxx
Xxxxxxx, Xxxxxxxxxx 00000 and (b) if to the Company, to its agent for service
as such agent's address appears on the cover page of the Registration
Statement, with a copy to Xxxxxx X. Xxxxx, Esq., Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, 000 Xxxxx Xxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000.
This Agreement shall be governed by and construed in accordance with the
laws of the State of New York without regard to principles of conflict of
laws.
This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.
-23-
Please confirm that the foregoing correctly sets forth the agreement
among us.
Very truly yours,
GUESS ?, INC.
By _____________________
Title:
Confirmed:
CIBC World Markets Corp.
PaineWebber Incorporated
Chase Securities Inc.
Xxxxxx Xxxxxxx Incorporated
Xxxxxx, Xxxxx Xxxxx Incorporated
C/O CIBC WORLD MARKETS CORP.
___________________________________
Acting severally on behalf of itself
and as representative of the several
Underwriters named in Schedule I annexed
hereto.
By CIBC WORLD MARKETS CORP.
By_____________________
Title:
-24-
SCHEDULE I
Number of
Firm Shares to
NAME BE PURCHASED
CIBC World Markets Corp.
PaineWebber Incorporated
Chase Securities Inc.
Xxxxxx Xxxxxxx Incorporated
Xxxxxx, Xxxxx Xxxxx Incorporated
----------------
Total 4,500,000
================
-25
SCHEDULE II
List of Persons Subject to Lock-Up Agreements
Xxxxxxx Xxxxxxxx
Xxxx Xxxxxxxx
Xxxxxx Xxxxxxxx
Xxxxx Xxxxxxxxx
Xxxxx Xxxxxxx
Xxxxxx Xxxxx
Xxxxx Xxxx
Xxxxxx Xxxxx
Xxxxx Xxxxxx
-26-
FORM OF LOCK UP AGREEMENT
-27-