EXHIBIT 1.1
_________ Shares of Common Stock
OUTDOOR CHANNEL HOLDINGS, INC.
UNDERWRITING AGREEMENT
__________, 2005
BEAR, XXXXXXX & CO. INC.
X.X. XXXXXXX & SONS, INC.
XXXXXXXXX & COMPANY, INC.
As Representatives of the
several Underwriters named in
Schedule I attached hereto (the "Representatives")
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Outdoor Channel Holdings, Inc., a corporation organized and existing
under the laws of Delaware (the "Company"), proposes, subject to the terms and
conditions stated herein, to issue and sell to the several underwriters named in
Schedule I hereto (the "Underwriters") an aggregate of ________ shares (the
"Company Shares") of its common stock, par value $0.001 per share (the "Common
Stock"). The stockholders of the Company listed on Schedule II hereto (the
"Selling Stockholders") severally propose to sell to the Underwriters an
aggregate of _____ shares of Common Stock (the "Selling Stockholders' Shares"
and together with the Company Shares, the "Firm Shares"). For the sole purpose
of covering over-allotments in connection with the sale of the Firm Shares, at
the option of the Underwriters, the Selling Stockholders also propose to sell to
the Underwriters up to _____ additional shares of Common Stock (the "Additional
Shares"). The Firm Shares and any Additional Shares purchased by the
Underwriters are referred to herein as the "Shares." The Shares are more fully
described in the Registration Statement and Prospectus referred to below. Bear,
Xxxxxxx & Co. Inc. ("Bear Xxxxxxx"), X.X. Xxxxxxx & Sons, Inc. and Xxxxxxxxx &
Company, Inc. are acting as lead managers in connection with the offering and
sale of the Shares contemplated herein (the "Offering").
On September 8, 2004, the Company effected a series of transactions
pursuant to which the Company acquired all of the outstanding common stock of
The Outdoor Channel, Inc. ("TOC") that it did not previously own by means of (i)
the merger of TOC with a newly formed, wholly owned subsidiary of the Company,
with TOC being the surviving corporation, and (ii) the exchange of each share of
TOC common stock not previously held by the Company or its subsidiaries for
shares of the Company's common stock, which exchange of shares was exempt from
the registration requirements of the Securities Act (as defined below) by reason
of Section 3(a)(10) thereof. In addition, each outstanding option to purchase
one share of TOC common stock was exchanged for an option to purchase 0.65
shares of the Company's common
stock. On September 14, 2004, the Company reincorporated under the laws of
Delaware and simultaneously effected a 5-for-2 forward split of its common
stock. In addition, the par value of the Common Stock was changed from $0.02 to
$0.001 per share. All of the foregoing transactions are referred to herein as
the "Reorganization."
1. Representations and Warranties of the Company. The Company represents
and warrants to, and agrees with, each of the Underwriters as of the date
hereof, the Closing Date and any additional Additional Closing Date that:
(a) The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3 (No.
333-125084), and amendments thereto, and related preliminary prospectuses for
the registration under the Securities Act of 1933, as amended (the "Securities
Act"), of the Shares which registration statement, as so amended (including
post-effective amendments, if any), has been declared effective by the
Commission and copies of which have heretofore been delivered to the
Underwriters. The registration statement, as amended at the time it became
effective, including the prospectus, financial statements, schedules, exhibits
and other information (if any) deemed to be part of the registration statement
at the time of effectiveness pursuant to Rule 430A or 434(d) under the
Securities Act, is hereinafter referred to as the "Registration Statement." If
the Company has filed or is required pursuant to the terms hereof to file a
registration statement pursuant to Rule 462(b) under the Securities Act
registering additional shares of Common Stock (a "Rule 462(b) Registration
Statement"), then, unless otherwise specified, any reference herein to the term
"Registration Statement" shall be deemed to include such Rule 462(b)
Registration Statement. Other than a Rule 462(b) Registration Statement, which,
if filed, becomes effective upon filing, no other document with respect to the
Registration Statement has heretofore been filed with the Commission. All of the
Shares have been registered under the Securities Act pursuant to the
Registration Statement or, if any Rule 462(b) Registration Statement is filed,
will be duly registered under the Securities Act with the filing of such Rule
462(b) Registration Statement. Based on oral communications from the Commission,
no stop order suspending the effectiveness of either the Registration Statement
or the Rule 462(b) Registration Statement, if any, has been issued and, to the
knowledge of the Company, no proceeding for that purpose has been initiated or
threatened by the Commission. The Company, if required by the Securities Act and
the rules and regulations of the Commission (the "Rules and Regulations"),
proposes to file the Prospectus with the Commission pursuant to Rule 424(b)
under the Securities Act ("Rule 424(b)"). The prospectus, in the form in which
it is to be filed with the Commission pursuant to Rule 424(b), or, if the
prospectus is not to be filed with the Commission pursuant to Rule 424(b), the
prospectus in the form included as part of the Registration Statement at the
time the Registration Statement became effective, is hereinafter referred to as
the "Prospectus," except that if any revised prospectus or prospectus supplement
shall be provided to the Underwriters by the Company for use in connection with
the Offering which differs from the Prospectus (whether or not such revised
prospectus or prospectus supplement is required to be filed by the Company
pursuant to Rule 424(b)), the term "Prospectus" shall also refer to such revised
prospectus or prospectus supplement, as the case may be, from and after the time
it is first provided to the Underwriters for such use. Any preliminary
prospectus or prospectus subject to completion included in the Registration
Statement or filed with the Commission pursuant to Rule 424 under the Securities
Act is hereafter called a "Preliminary Prospectus." Any reference herein to the
Registration Statement, any Preliminary Prospectus or the Prospectus shall be
deemed to refer to
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and include the documents incorporated by reference therein pursuant to Item 12
of Form S-3 which were filed under the Exchange Act (as defined below) on or
before the effective date of the Registration Statement, the date of such
Preliminary Prospectus or the date of the Prospectus, as the case may be, and
any reference herein to the terms "amend", "amendment" or "supplement" with
respect to the Registration Statement, any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include (i) the filing of any
document under the Exchange Act after the effective date of the Registration
Statement, the date of such Preliminary Prospectus or the date of the
Prospectus, as the case may be, which is incorporated therein by reference and
(ii) any such document so filed. All references in this Agreement to the
Registration Statement, the Rule 462(b) Registration Statement, a Preliminary
Prospectus and the Prospectus, or any amendments or supplements to any of the
foregoing shall be deemed to include any copy thereof filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval System
("XXXXX").
(b) At the time of the effectiveness of the Registration
Statement or any Rule 462(b) Registration Statement or the effectiveness of any
post-effective amendment to the Registration Statement, when the Prospectus is
first filed with the Commission pursuant to Rule 424(b) or Rule 434 under the
Securities Act ("Rule 434"), when any supplement to or amendment of the
Prospectus is filed with the Commission, when any document filed under the
Exchange Act was or is filed and which is incorporated by reference into the
Registration Statement and at the Closing Date and the Additional Closing Date,
if any (as hereinafter respectively defined), the Registration Statement and the
Prospectus and any amendments thereof and supplements thereto complied or will
comply in all material respects with the applicable provisions of the Securities
Act, the Exchange Act and the Rules and Regulations and did not and will not
contain an untrue statement of a material fact and did not and will not omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein (i) in the case of the Registration Statement, not
misleading and (ii) in the case of the Prospectus or any related Preliminary
Prospectus in light of the circumstances under which they were made, not
misleading. When any Preliminary Prospectus was first filed with the Commission
(whether filed as part of the registration statement for the registration of the
Shares or any amendment thereto or pursuant to Rule 424(a) under the Securities
Act) and when any amendment thereof or supplement thereto was first filed with
the Commission, such Preliminary Prospectus and any amendments thereof and
supplements thereto complied in all material respects with the applicable
provisions of the Securities Act, the Exchange Act and the Rules and Regulations
and did not contain an untrue statement of a material fact and did not omit to
state any 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. 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. No representation and
warranty is made in this subsection (b), however, with respect to any
information contained in or omitted from the Registration Statement or the
Prospectus or any related Preliminary Prospectus or any amendment thereof or
supplement thereto in reliance upon and in conformity with information furnished
in writing to the Company by or on behalf of any Underwriter through the
Representatives specifically for use therein. The parties acknowledge and agree
that such information provided by or on behalf of any Underwriter consists
solely of the material included
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in paragraphs ___ and ___ on the cover page of the Prospectus and paragraphs
___, ___ and ___ under the caption "Underwriting" in the Prospectus.
(c) X.X. Xxxx LLP, which has audited and expressed an opinion on
the financial statements and supporting schedules and information of the Company
and its subsidiaries for the year ended December 31, 2004 that are included in
the Registration Statement whose report appear in the Registration Statement or
the Prospectus, is an independent registered public accounting firm registered
with the Public Company Accounting Oversight Board, as required by the
Securities Act, the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and the Rules and Regulations.
(d) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, except as disclosed
in the Registration Statement and the Prospectus, the Company has not declared,
paid or made any dividends or other distributions of any kind on or in respect
of its capital stock and there has been no material adverse change or, to the
Company's knowledge, any development reasonably likely to result in a material
adverse change, whether or not arising from transactions in the ordinary course
of business, in or affecting (i) the business, condition (financial or
otherwise), results of operations, stockholders' equity, properties of the
Company and each subsidiary of the Company listed on Exhibit A hereto (the
"Subsidiaries"), taken as a whole; (ii) the long-term debt, if any, or capital
stock of the Company and the Subsidiaries, taken as a whole; or (iii) the
Offering or consummation of any of the other transactions contemplated by this
Agreement, the Registration Statement or the Prospectus (a "Material Adverse
Change"). Since the date of the latest balance sheet presented in the
Registration Statement and the Prospectus, neither the Company nor any
Subsidiary has incurred or undertaken any liabilities or obligations, whether
direct or indirect, or entered into any transactions, including any acquisition
or disposition of any business or asset, which are material to the Company and
the Subsidiaries taken as a whole, except for liabilities, obligations and
transactions which are disclosed in the Registration Statement and the
Prospectus.
(e) The authorized, issued and outstanding capital stock of the
Company was as of March 31, 2005 as set forth in the Prospectus in the column
headed "Actual" under the caption "Capitalization" and, after giving effect to
the Offering and the other transactions contemplated by this Agreement, the
Registration Statement and the Prospectus, will be as set forth in the column
headed "Pro Forma" under the caption "Capitalization," except for immaterial
changes resulting from the issuance of common stock pursuant to employee benefit
plans, stock option plans or other employee compensation plans existing on the
date hereof or as otherwise disclosed in the Registration Statement and the
Prospectus. All of the issued and outstanding shares of capital stock of the
Company are fully paid and non-assessable and have been duly and validly
authorized and issued, in compliance with all applicable state and federal
securities laws and not in violation of or subject to any preemptive or similar
right that does or will entitle any person to acquire from the Company or any
Subsidiary any Common Stock or other equity security of the Company or any
Subsidiary or any security convertible into, or exercisable or exchangeable for,
Common Stock or any other such security (any "Relevant Security"), except for
such rights as may have been fully satisfied or waived prior to the
effectiveness of the Registration Statement.
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(f) The Company Shares have been duly and validly authorized
and, when delivered in accordance with this Agreement, will be duly and validly
issued, fully paid and non-assessable, will have been issued in compliance with
all applicable state and federal securities laws and will not have been issued
in violation of or subject to any preemptive or similar right that does or will
entitle any person to acquire any Relevant Security from the Company or any
Subsidiary upon issuance or sale of Company Shares in the Offering. The Common
Stock and the Shares conform to the descriptions thereof contained in the
Registration Statement and the Prospectus. Except as disclosed in the
Registration Statement and the Prospectus, including, but not limited to,
employee benefit plans, stock option plans or other employee compensation plans
or agreements disclosed therein, neither the Company nor any Subsidiary has
outstanding warrants, options to purchase, or any preemptive rights or other
rights to subscribe for or to purchase, or any contracts or commitments to issue
or sell, any Relevant Security.
(g) The Subsidiaries are the only subsidiaries of the Company
within the meaning of Rule 405 under the Securities Act. Except for the
Subsidiaries, the Company holds no ownership or other equity interest, nominal
or beneficial, direct or indirect, in any corporation, partnership, joint
venture or other business entity, other than its investments in
available-for-sale securities, which are less than $750,000. All of the issued
shares of capital stock of or other ownership interests in each Subsidiary have
been duly and validly authorized and issued and are fully paid and
non-assessable and are owned directly or indirectly by the Company free and
clear of any lien, charge, mortgage, pledge, security interest, claim, equity,
trust or other encumbrance, preferential arrangement, defect or restriction of
any kind whatsoever (any "Lien").
(h) Each of the Company and the Subsidiaries has been duly
organized and validly exists as a corporation, partnership or limited liability
company in good standing under the laws of its jurisdiction of organization.
Each of the Company and the Subsidiaries has all requisite corporate or limited
liability company power and authority to carry on its business as it is
currently being conducted and as described in the Prospectus, and to own, lease
and operate its respective properties. Each of the Company and the Subsidiaries
is duly qualified to do business and is in good standing as a foreign
corporation, partnership or limited liability company in each jurisdiction in
which the character or location of its properties (owned, leased or licensed) or
the nature or conduct of its business makes such qualification necessary, except
for those failures to be so qualified or in good standing which (individually
and in the aggregate) would not reasonably be expected to have a material
adverse effect on (i) the business, condition (financial or otherwise), results
of operations, stockholders' equity, or properties of the Company and the
Subsidiaries, taken as a whole; (ii) the long-term debt, if any, or capital
stock of the Company and the Subsidiaries, taken as a whole; or (iii) the
Offering or consummation of any of the other transactions contemplated by this
Agreement, the Registration Statement or the Prospectus (any such effect being a
"Material Adverse Effect").
(i) Each of the Company and the Subsidiaries has all necessary
consents, approvals, authorizations, orders, registrations, qualifications,
licenses, filings and permits of, with and from all judicial, regulatory and
other legal or governmental agencies and bodies and all third parties, foreign
and domestic (collectively, the "Consents"), to own, lease and operate its
properties and conduct its business as it is now being conducted and as
disclosed
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in the Registration Statement and the Prospectus, except where the failure to
obtain any such Consent would not reasonably be expected to have a Material
Adverse Effect. Each such Consent is valid and in full force and effect, and
neither the Company nor any Subsidiary has received notice of any investigation
or proceedings which results in or, if decided adversely to the Company or any
Subsidiary, would reasonably be expected to have a Material Adverse Effect. Each
of the Company and the Subsidiaries is in compliance with all applicable laws,
rules, regulations, ordinances, directives, judgments, decrees and orders,
foreign and domestic, except where failure to be in compliance would not
reasonably be expected to have a Material Adverse Effect. No Consent contains a
burdensome restriction not adequately disclosed in the Registration Statement
and the Prospectus that would reasonably be expected to have a Material Adverse
Effect.
(j) The Company has full right, power and authority to execute
and deliver this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated by this Agreement, the Registration
Statement and the Prospectus. This Agreement and the transactions contemplated
by this Agreement, the Registration Statement and the Prospectus have been duly
and validly authorized by the Company. This Agreement has been duly and validly
executed and delivered by the Company and constitutes the legal, valid and
binding obligation of the Company, enforceable in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights generally
and except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
(k) The execution, delivery, and performance of this Agreement
and consummation of the transactions contemplated by this Agreement, the
Registration Statement and the Prospectus do not and will not (i) conflict with,
require consent under or result in a breach of any of the terms and provisions
of, or constitute a default (or an event which with notice or lapse of time, or
both, would constitute a default) 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, any indenture, mortgage, deed of trust, loan
agreement or other agreement, instrument, franchise, license or permit to which
the Company or any Subsidiary is a party or by which the Company or any
Subsidiary or their respective properties, operations or assets may be bound or
(ii) violate or conflict with any provision of the certificate or articles of
incorporation, by-laws, certificate of formation, limited liability company
agreement, partnership agreement or other organizational documents of the
Company or any Subsidiary, or (iii) violate or conflict in any material respect
with any law, rule, regulation, ordinance, directive, judgment, decree or order
of any judicial, regulatory or other legal or governmental agency or body,
domestic or foreign applicable to the Company, except (in the case of clauses
(i) and (iii) above) as would not reasonably be expected to have a Material
Adverse Effect.
(l) No Consent of, with or from any judicial, regulatory or
other legal or governmental agency or body or any third party, foreign or
domestic, is required for the execution, delivery and performance by the Company
of this Agreement or consummation of the transactions to be consummated by the
Company contemplated by this Agreement, the Registration Statement and the
Prospectus, including the issuance, sale and delivery of the Company Shares to
be issued, sold and delivered hereunder, except the registration under the
6
Securities Act of the Shares, which has become effective, and such Consents as
may be required under state securities or blue sky laws or the by-laws and rules
of the National Association of Securities Dealers, Inc. (the "NASD") or NASD
Regulation, Inc. ("NASDR") in connection with the purchase and distribution of
the Shares by the Underwriters.
(m) Except as disclosed in the Registration Statement and the
Prospectus, there is no judicial, regulatory, arbitral or other legal or
governmental proceeding or other litigation or arbitration, domestic or foreign,
pending to which the Company or any Subsidiary is a party or of which any
property, operations or assets of the Company or any Subsidiary is the subject
which, individually or in the aggregate, if determined adversely to the Company
or any Subsidiary, would reasonably be expected to have a Material Adverse
Effect; to the Company's knowledge, no such proceeding, litigation or
arbitration is threatened or contemplated; and the defense of all such
proceedings, litigation and arbitration against or involving the Company or any
Subsidiary would not reasonably be expected to have a Material Adverse Effect.
(n) The financial statements, including the notes thereto, and
the supporting schedules included or incorporated by reference in the
Registration Statement and the Prospectus present fairly in all material
respects the financial position as of the dates indicated and the cash flows and
results of operations for the periods specified of the Company and its
consolidated subsidiaries or incorporated by reference in the Registration
Statement and the Prospectus; except as otherwise stated in the Registration
Statement and the Prospectus, said financial statements have been prepared in
conformity with United States generally accepted accounting principles applied
on a consistent basis throughout the periods involved; and the supporting
schedules included or incorporated by reference in the Registration Statement
and the Prospectus present fairly in all material respects the information
required to be stated therein. No other financial statements or supporting
schedules are required to be included in the Registration Statement. The other
financial and statistical information derived from the financial statements
included or incorporated by reference in the Registration Statement and the
Prospectus present fairly in all material respects the information included
therein and have been prepared on a basis consistent with that of the financial
statements that are included or incorporated by reference in the Registration
Statement and the Prospectus and the books and records of the respective
entities presented therein.
(o) There are no pro forma or as adjusted financial statements
which are required to be included or incorporated by reference in the
Registration Statement and the Prospectus in accordance with Regulation S-X that
have not been included as so required.
(p) The statistical (other than statistical data derived from
the financial statements), industry-related and market-related data included in
the Registration Statement and the Prospectus are based on or derived from
sources which the Company reasonably and in good faith believes are reliable and
accurate, and such data agree with the sources from which they are derived.
(q) The Company is subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act and files reports with the Commission on
XXXXX. The Common Stock is registered pursuant to Section 12(g) of the Exchange
Act and the outstanding
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shares of Common Stock (including the Selling Stockholders' Shares and the
Additional Shares) are listed for quotation on the NASDAQ (as defined in Section
13(b) below), the Company Shares have been approved for quotation on the NASDAQ
upon issuance or sale and the Company has taken no action designed to, or
reasonably likely to have the effect of, terminating the registration of the
Common Stock under the Exchange Act or de-listing the Common Stock from the
NASDAQ. The Company has not received any notification that (i) the Commission is
contemplating terminating such registration or (ii) since the listing of the
Common Stock on the NASDAQ on September 15, 2004, the NASDAQ is contemplating
terminating such listing.
(r) The Company and the Subsidiaries maintain a system of
internal accounting and other 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 conformity with United States
generally accepted accounting principles and to maintain accountability for
assets, (iii) access to assets is permitted only in accordance with management's
general or specific authorization, and (iv) the recorded accounting for assets
is compared with existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
(s) Neither the Company nor, to the Company's knowledge, any of
its affiliates (within the meaning of Rule 144 under the Securities Act) has
taken, directly or indirectly, any action which constitutes or is designed to
cause or result in, or which would reasonably be expected to constitute, cause
or result in, the stabilization or manipulation of the price of any security to
facilitate the sale or resale of the Shares.
(t) Neither the Company nor, to the Company's knowledge, any of
its affiliates has, prior to the date hereof, made any offer or sale of any
securities which could be "integrated" for purposes of the Securities Act or the
Rules and Regulations with the offer and sale of the Shares pursuant to the
Registration Statement. Except as disclosed in the Registration Statement and
the Prospectus, neither the Company nor, to the Company's knowledge, any of its
affiliates has sold or issued any Relevant Security during the six-month period
preceding the date of the Prospectus, including but not limited to any sales
pursuant to Rule 144A or Regulation D or S under the Securities Act, other than
shares of Common Stock issued pursuant to the Reorganization or employee benefit
plans, stock option plans or the employee compensation plans or pursuant to
outstanding options, rights or warrants described in the Registration Statement
and the Prospectus.
(u) Except as disclosed in the Registration Statement and the
Prospectus, no holder of any Relevant Security has any rights to require
registration of any Relevant Security as part or on account of, or otherwise in
connection with, the offer and sale of the Shares contemplated hereby, and any
such rights so disclosed have either been fully complied with by the Company or
effectively waived by the holders thereof, and any such waivers remain in full
force and effect.
(v) The conditions for use of Form S-3 to register the Offering
under the Securities Act, as set forth in the General Instructions to such Form,
have been satisfied.
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(w) The documents incorporated or deemed to be incorporated by
reference in the Prospectus, at the time they were or hereafter are filed with
the Commission, complied and will comply in all material respects with the
applicable requirements of the Exchange Act and the Rules and Regulations.
(x) The Company is not and, at all times up to and including
consummation of the transactions contemplated by this Agreement, the
Registration Statement and the Prospectus, and after giving effect to
application of the net proceeds of the Offering, will not be, subject to
registration as an "investment company" under the Investment Company Act of
1940, as amended, and is not and will not be an entity "controlled" by an
"investment company" within the meaning of such act.
(y) There are no contracts or other documents (including,
without limitation, any voting agreement), which are required to be described in
the Registration Statement and the Prospectus or filed as exhibits to the
Registration Statement by the Securities Act, the Exchange Act or the Rules and
Regulations that have not been so described or incorporated by reference therein
or filed.
(z) No relationship, direct or indirect, exists between or among
any of the Company, on the one hand, and any director, officer, stockholder,
customer or supplier of the Company or any affiliate of the Company, on the
other hand, which is required by the Securities Act, the Exchange Act or the
Rules and Regulations to be described in the Registration Statement or the
Prospectus which is not so described and described as required. There are no
outstanding loans, advances (except normal advances for business expenses in the
ordinary course of business) or guarantees of indebtedness by the Company to or
for the benefit of any of the officers or directors of the Company or any of
their respective family members, except as disclosed in the Registration
Statement and the Prospectus.
(aa) Except as disclosed in the Registration Statement and the
Prospectus, there are no contracts, agreements or understandings between the
Company and any person that would give rise to a valid claim against the Company
or any Underwriter for a brokerage commission, finder's fee or other like
payment in connection with the transactions contemplated by this Agreement, the
Registration Statement and the Prospectus or, to the Company's knowledge, any
arrangements, agreements, understandings, payments or issuance with respect to
the Company or any of its officers, directors, stockholders, partners,
employees, Subsidiaries or affiliates that may affect the Underwriters'
compensation as determined by the NASD.
(bb) The Company and each Subsidiary owns or leases all such
tangible real and personal and intangible properties as are necessary to the
conduct of its business as presently operated and as proposed to be operated as
described in the Registration and the Prospectus. The Company and the
Subsidiaries have title in fee simple to all real property and title to all
personal property owned by them, in each case free and clear of all Liens except
such as are described in the Registration Statement and the Prospectus or such
as do not or would not reasonably be expected to (individually or in the
aggregate) have a Material Adverse Effect; and any real property and buildings
held under lease or sublease by the Company and the Subsidiaries are held by
them under valid, subsisting and enforceable leases with such exceptions
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as are not material to, and do not interfere with, the use made and proposed to
be made of such property and buildings by the Company and the Subsidiaries,
except as would not reasonably be expected to have a Material Adverse Effect.
Neither the Company nor any Subsidiary has received any notice of any claim
adverse to its ownership of any real or personal property or of any claim
against the continued possession of any real property, whether owned or held
under lease or sublease by the Company or any Subsidiary, except as would not
reasonably be expected to have a Material Adverse Effect.
(cc) Except as described in the Registration Statement and the
Prospectus or the documents incorporated therein by reference, the Company and
each Subsidiary (i) owns or possesses adequate right to use all patents, patent
applications, trademarks, service marks, trade names, trademark registrations,
service xxxx registrations, copyrights, licenses, formulae, customer lists, and
know-how and other intellectual property (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information, systems
or procedures, "Intellectual Property") necessary for the conduct of their
respective businesses as being conducted and as described in the Registration
Statement and Prospectus, except where the failure to own or possess such
rights, either singly or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect, and (ii) have no reason to believe that the
conduct of their respective businesses does or will conflict with, and have not
received any notice of any claim of conflict with, any such right of others,
except where any such conflicts, either singly or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect. To the Company's
knowledge, all material technical information developed by and belonging to the
Company or any Subsidiary which has not been patented has been kept
confidential. To the Company's knowledge, there is no infringement by third
parties of any such Intellectual Property, except where such infringement would
not reasonably be expected to have a Material Adverse Effect; there is no
pending or, to the Company's knowledge, threatened action, suit, proceeding or
claim by others challenging the Company's or any Subsidiary's rights in or to
any such Intellectual Property, except where such action, suit, proceeding or
claim would not reasonably be expected to have a Material Adverse Effect, and
the Company is unaware of any facts which would form a reasonable basis for any
such claim; and there is no pending or, to the Company's knowledge, threatened
action, suit, proceeding or claim by others that the Company or any Subsidiary
infringes or otherwise violates any patent, trademark, copyright, trade secret
or other proprietary rights of others, except where such action, suit,
proceeding or claim would not reasonably be expected to have a Material Adverse
Effect, and the Company is unaware of any other fact which would form a
reasonable basis for any such claim.
(dd) The Company and the Subsidiaries maintain insurance in such
amounts and covering such risks as the Company reasonably considers adequate for
the conduct of its business and the value of its properties all of which
insurance is in full force and effect, except where the failure to maintain such
insurance would not reasonably be expected to have a Material Adverse Effect.
There are no material claims by the Company or any Subsidiary under any such
policy or instrument as to which any insurance company is denying liability or
defending under a reservation of rights clause. The Company reasonably believes
that it will be able to renew its existing insurance as and when such coverage
expires or will be able to obtain replacement insurance adequate for the conduct
of the business and the value of its properties at a cost that would not
reasonably be expected to have a Material Adverse Effect.
10
(ee) Except as described in the Registration Statement and the
Prospectus or the documents incorporated therein by reference, each of the
Company and the Subsidiaries has accurately prepared and timely filed all
federal, state, foreign and other tax returns that are required to be filed by
it (or has received extensions therefor) and has paid or made provision for the
payment of all taxes, assessments, governmental or other similar charges,
including without limitation, all sales and use taxes and all taxes which the
Company or any Subsidiary is obligated to withhold from amounts owing to
employees, creditors and third parties, with respect to the periods covered by
such tax returns (whether or not such amounts are shown as due on any tax
return), except where such failure would not reasonably be expected to have a
Material Adverse Effect or amounts which the Company is contesting in good
faith. Except as described in the Registration Statement and the Prospectus or
the documents incorporated therein by reference, no deficiency assessment with
respect to a proposed adjustment of the Company's or any Subsidiary's federal,
state, local or foreign taxes is pending or, to the Company's knowledge,
threatened, that would reasonably be expected to have a Material Adverse Effect
The accruals and reserves on the books and records of the Company and the
Subsidiaries in respect of tax liabilities for any taxable period not finally
determined are adequate to meet any assessments and related liabilities for any
such period and, since December 31, 2004, the Company and the Subsidiaries have
not incurred any liability for taxes other than in the ordinary course of its
business, except, in each such case, where such tax liabilities would not
reasonably be expected to have a Material Adverse Effect.
(ff) No labor disturbance by the employees of the Company or any
Subsidiary exists or, to the Company's knowledge, is imminent that would
reasonably be expected to have a Material Adverse Effect.
(gg) No "prohibited transaction" (as defined in either Section
406 of the Employee Retirement Income Security Act of 1974, as amended,
including the regulations and published interpretations thereunder ("ERISA") or
Section 4975 of the Internal Revenue Code of 1986, as amended from time to time
(the "Code")), "accumulated funding deficiency" (as defined in Section 302 of
ERISA) or other event of the kind described in Section 4043(b) of ERISA (other
than events with respect to which the 30-day notice requirement under Section
4043 of ERISA has been waived) has occurred with respect to any employee benefit
plan that would reasonably be expected to have a Material Adverse Effect; each
employee benefit plan for which the Company or any Subsidiary would have any
liability is in compliance in all material respects with applicable law,
including (without limitation) ERISA and the Code; the Company has not incurred
and does not expect to incur liability under Title IV of ERISA with respect to
the termination of, or withdrawal from any "pension plan"; and each plan for
which the Company would have any liability that is intended to be qualified
under Section 401(a) of the Code is so qualified and, to the Company's
knowledge, nothing has occurred, whether by action or by failure to act, that
would reasonably be expected to have a Material Adverse Effect.
(hh) There has been no storage, generation, transportation,
handling, treatment, disposal, discharge, emission or other release of any kind
of toxic or other wastes or other hazardous substances by, due to, or caused by
the Company or any Subsidiary (or, to the Company's knowledge, any other entity
for whose acts or omissions the Company is or may be liable) upon any property
now or previously owned or leased by the Company or any Subsidiary, which would
be a violation of or give rise to any liability under any applicable law, rule,
11
regulation, order, judgment, decree or permit relating to pollution or
protection of human health and the environment ("Environmental Law"), except
where such violation would not reasonably be expected to have a Material Adverse
Effect. Neither the Company nor any Subsidiary has agreed to assume, undertake
or provide indemnification for any liability of any other person under any
Environmental Law, including any obligation for cleanup or remedial action,
except where such liability would not reasonably be expected to have a Material
Adverse Effect. There is no pending or, to the Company's knowledge, threatened
administrative, regulatory or judicial action, claim or notice of noncompliance
or violation, investigation or proceedings relating to any Environmental Law
against the Company or any Subsidiary that would reasonably be expected to have
a Material Adverse Effect.
(ii) Neither the Company, any Subsidiary nor, to the Company's
knowledge, any of its employees or agents has at any time during the last five
years (i) made any unlawful contribution to any candidate for foreign office, or
failed to disclose fully any contribution in violation of law, or (ii) made any
payment to any federal or state governmental officer or official, or other
person charged with similar public or quasi-public duties, other than payments
required or permitted by the laws of the United States of any jurisdiction
thereof.
(jj) Neither the Company nor, to the knowledge of the Company,
any director, officer, agent, employee or affiliate of the Company is currently
subject to any U.S. sanctions administered by the Office of Foreign Assets
Control of the U.S. Treasury Department ("OFAC"); and the Company will not
directly or indirectly use the proceeds of the offering, or lend, contribute or
otherwise make available such proceeds to any subsidiary, joint venture partner
or other person or entity, for the purpose of financing the activities of any
person currently subject to any U.S. sanctions administered by OFAC.
(kk) Neither the Company nor any Subsidiary (i) is in violation
of its certificate or articles of incorporation, by-laws, certificate of
formation, limited liability company agreement, partnership agreement or other
organizational documents, (ii) is in default under, and no event has occurred
which, with notice or lapse of time or both, would constitute a default under or
result in the creation or imposition of any lien, charge or encumbrance upon any
of its property or assets pursuant to, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which it is a party or by
which it is bound or to which any of its property or assets is subject or (iii)
is in violation in any respect of any law, rule, regulation, ordinance,
directive, judgment, decree or order of any judicial, regulatory or other legal
or governmental agency or body, foreign or domestic, except (in the case clauses
(ii) and (iii) above) violations or defaults that would not (individually or in
the aggregate) reasonably be expected to have a Material Adverse Effect and
except (in the case of clause (ii) alone) for any lien, charge or encumbrance
disclosed in the Registration Statement and the Prospectus.
(ll) The Company is in compliance in all material respects with
applicable provisions of the Xxxxxxxx-Xxxxx Act that are effective.
(mm) Since the date of the filing of the Company's Quarterly
Report on Form 10-Q for the quarterly period ended March 31, 2005, the Company's
auditors and the audit committee of the board of directors of the Company (or
persons fulfilling the equivalent function) have not been advised of (i) any
significant deficiencies in the design or operation of
12
internal control over financial reporting which are reasonably likely to affect
the Company's ability to record, process, summarize and report financial
information; or (ii) any fraud, whether or not material, that involves
management or other employees who have a significant role in the Company's
internal control over financial reporting.
(nn) Since the date of the filing of the Company's Quarterly
Report on Form 10-Q for the quarterly period ended March 31, 2005, there have
been no significant changes in the Company's internal control over financial
reporting that could materially affect the Company's internal control over
financial reporting.
(oo) The description of the transactions constituting the
Reorganization in the second paragraph of this Agreement is accurate and
complete in all material respects. The Reorganization was duly authorized by all
necessary action on the part of the Company and its stockholders, and all
documents and agreements pursuant to which the Reorganization was effected were
duly executed and delivered by each of the parties thereto. The execution and
delivery of the documents and agreements effecting the Reorganization and the
consummation of the Reorganization did not result in any violation of the
provisions of the certificate of incorporation, articles of incorporation or
by-laws of the Company, the entities party to the Reorganization, or any statute
or any order, rule or regulation of any court or governmental agency or body
having jurisdiction over the Company, the entities party to the Reorganization
or any of their respective subsidiaries or properties; and no consent, approval,
authorization, order, registration or qualification of or with any such court or
governmental agency or body is or was required in connection with the
Reorganization except such as have been timely obtained.
(pp) No stockholder of the Company or TOC has exercised
dissenter's or appraisal rights in connection with the Reorganization that
continues to exercise such dissenter's rights or demand appraisal of such
stockholder's shares as of the date hereof.
Any certificate signed by or on behalf of the Company and delivered to
the Representatives or to counsel for the Underwriters' shall be deemed to be a
representation and warranty by the Company to each Underwriter as to the matters
covered thereby.
2. Representations and Warranties of the Selling Stockholders. Each
Selling Stockholder severally, and not jointly, represents and warrants to, and
agrees with, each of the Underwriters and the Company as of the date hereof and
as of the Closing Date and each Additional Closing Date that:
(a) Such Selling Stockholder has full right, power and authority
to execute and deliver this Agreement, to perform its obligations hereunder and
to consummate the transactions contemplated by this Agreement, the Registration
Statement and the Prospectus. This Agreement and the transactions contemplated
by this Agreement, the Registration Statement and the Prospectus have been duly
and validly authorized by such Selling Stockholder. This Agreement has been duly
and validly executed and delivered by such Selling Stockholder and constitutes
the legal, valid and binding obligation of such Selling Stockholder, enforceable
in accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally and
13
except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
(b) Such Selling Stockholder has full right, power and authority
to execute and deliver a Custody Agreement and Power of Attorney substantially
in the form of Exhibits B and C hereto (such Selling Stockholder's "Custody
Agreement" and "Power of Attorney," respectively), to perform its obligations
thereunder and to consummate the transactions contemplated by thereby. The
Custody Agreement and Power of Attorney and the transactions contemplated by
thereby have been duly and validly authorized by such Selling Stockholder. The
Custody Agreement and Power of Attorney have each been duly and validly executed
and delivered by such Selling Stockholder and constitute the legal, valid and
binding obligation of such Selling Stockholder, enforceable in accordance with
its terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally and except as enforceability may be subject to general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law). Counterparts of such Selling Stockholder's
Custody Agreement, duly signed by (i) _____________, as custodian (in such
capacity, the "Custodian"), and (ii) such Selling Stockholder or ______________,
as such Selling Stockholders' attorney-in-fact (in such capacity, the
"Attorney-In-Fact"), have been delivered to the Company and the Representatives
on or prior to the date of this Agreement.
(c) Such Selling Stockholder agrees that the Selling
Stockholders' Shares and Additional Shares, if any, to be sold by such Selling
Stockholder, whether or not on deposit with the Custodian and including any such
Selling Stockholders' Shares and Additional Shares underlying stock options
whether or not a notice or notices to exercise such stock options have been
deposited with the Custodian, are subject to the interests of the Underwriters,
that the arrangements made for such custody are to that extent irrevocable, and
that the obligations of such Selling Stockholder hereunder shall not be
terminated, except as provided in this Agreement or in the Custody Agreement and
Power of Attorney, by any act of such Selling Stockholder, by operation of law
or by the occurrence of any other event. If such Selling Stockholder should die
or become incapacitated, or if any other event should occur affecting the legal
status or capacity of such Selling Stockholder before the delivery of the
Selling Stockholders' Shares and the Additional Shares, if any, to be sold by a
Selling Stockholder hereunder, the documents evidencing the Selling
Stockholders' Shares and the Additional Shares, if any, to be sold by such
Selling Stockholder then on deposit with the Custodian shall be delivered by the
Custodian in accordance with the terms and conditions of this Agreement as if
such event had not occurred, regardless of whether or not the Custodian shall
have received notice thereof.
(d) Such Selling Stockholder has, and on the Closing Date and
any Additional Closing Date, will have, good and valid title to and is the
lawful owner of the Selling Stockholders' Shares and Additional Shares, if any,
to be sold by such Selling Stockholder hereunder (or, in the case of any such
Selling Stockholders' Shares or Additional Shares underlying stock options, such
stock options are, and on the Closing Date and Additional Closing Date, if
applicable, will be, presently exercisable and such Selling Stockholder is the
record and beneficial owner of such stock options and, upon the exercise of such
stock options on the Closing Date and Additional Closing Date, if applicable,
will be the record and beneficial owner
14
of such underlying Selling Stockholders' Shares and Additional Shares,
respectively). Upon sale and delivery of, and payment for, such Selling
Stockholders' Shares and Additional Shares as provided herein, such Selling
Stockholder will convey to the Underwriters good and marketable title to such
Selling Stockholders' Shares and Additional Shares, free and clear of all Liens.
Certificates for all of the Selling Stockholders' Shares and Additional Shares
to be sold by such Selling Stockholder pursuant to this Agreement (except for
those Selling Stockholders' Shares and Additional Shares to be issued pursuant
to the exercise of stock options beneficially owned by the Selling Stockholder,
as to which notices of exercise have been delivered to the Custodian), in
suitable form for transfer by delivery or accompanied by duly executed
instruments of transfer or assignment in blank with signatures guaranteed, have
been placed in custody with the Custodian with irrevocable conditional
instructions to deliver such Selling Stockholders' Shares and Additional Shares
to the Underwriters pursuant to this Agreement.
(e) No Consent of, from or with any judicial, regulatory or
other legal or governmental agency or body or any third party, foreign or
domestic, is required for the execution, delivery and performance by the Selling
Stockholder of this Agreement or its Custody Agreement and Power of Attorney, or
consummation by the Selling Stockholders of the transactions contemplated herein
or therein, except such as have been obtained under the Securities Act and such
as may be required under the state or foreign securities laws, the blue sky laws
of any jurisdiction, the NASD or NASDR in connection with the purchase and
distribution of such Selling Stockholder's Shares and such Selling Stockholder's
Additional Shares by the Underwriters.
(f) The execution, delivery and performance of this Agreement,
the Power of Attorney and the Custody Agreement by such Selling Stockholder and
consummation of any of the other transactions contemplated herein and therein by
the Selling Stockholder or the fulfillment of the terms hereof by the Selling
Stockholder will not (A) conflict with, result in a breach or violation of, or
constitute a default (or an event that with notice or lapse of time, or both,
would constitute a default) under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the Selling
Stockholder pursuant to any law, statute, rule or regulation or the terms of any
indenture or other agreement or instrument to which such Selling Stockholder is
party or bound, or to which any of the property or assets of such Selling
Stockholder is subject, or (B) if such Selling Stockholder is not a natural
person, result in any violation of the provisions of any charter or bylaws or
certificate of formation, trust agreement, partnership agreement, articles of
partnership or other organizational documents, as applicable, of the Selling
Stockholder, or (C) result in any violation or breach of any judgment, order,
decree statute, rule or regulation applicable to such Selling Stockholder of any
court or any public, governmental or regulatory agency or body, administrative
agency or arbitrator having jurisdiction over such Selling Stockholder.
(g) Such Selling Stockholder does not have any registration or
other similar rights to have any equity or debt securities registered for sale
by the Company under the Registration Statement or included in the offering of
the Shares and the Additional Shares, except for such rights as have been waived
or which are described in the Prospectus (and which have been complied with).
15
(h) Such Selling Stockholder does not have, or has waived prior
to the date hereof, any preemptive right, co-sale right or right of first
refusal or other similar right to purchase any of the Shares that are to be sold
by the Company or any other Selling Stockholder to the Underwriters pursuant to
this Agreement; and such Selling Stockholder does not own any warrants, options
or similar rights to acquire, and does not have any right or arrangement to
acquire, any capital stock, right, warrants, options or other securities from
the Company, other than those described in the Registration Statement and the
Prospectus.
(i) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between such Selling Stockholder and any
person that would give rise to a valid claim against the Company or any
Underwriter for a brokerage commission, finder's fee or other like payment in
connection with this offering or, to such Selling Stockholder's knowledge, any
other arrangements, agreements, understandings, payments or issuance with
respect to the Company or any of its officers, directors, stockholders,
partners, employees, Subsidiaries or affiliates that may affect the
Underwriters' compensation as determined by the NASD.
(j) At the time of the effectiveness of the Registration
Statement, any Rule 462(b) Registration Statement or the effectiveness of any
post-effective amendment to the Registration Statement, when the Prospectus is
first filed with the Commission pursuant to Rule 424, when any supplement to or
amendment of the Prospectus is filed with the Commission and at the Closing Date
and the Additional Closing Date, if any, the Registration Statement and the
Prospectus and any amendments thereof and supplements thereto complied or will
comply in all material respects with the applicable provisions of the Securities
Act, the Exchange Act and the Rules and Regulations and did not and will not
contain an untrue statement of a material fact and did not and will not omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein (x) in the case of the Registration Statement, not
misleading and (y) in the case of the Prospectus or any related Preliminary
Prospectus in light of the circumstances under which they were made, not
misleading, provided that the representations and warranties of the
Non-Management Selling Stockholders set forth in this Section 2(j) are limited
solely to statements or omissions made in reliance upon information relating to
such Non-Management Selling Stockholder furnished to the Company by such
Non-Management Selling Stockholder (the "Non-Management Selling Stockholder
Information") for use in the Registration Statement, the Preliminary Prospectus
and any amendments thereof or supplements thereto. When any related Preliminary
Prospectus was first filed with the Commission (whether filed as part of the
registration statement for the registration of the Shares or any amendment
thereto or pursuant to Rule 424(a) under the Securities Act) and when any
amendment thereof or supplement thereto was first filed with the Commission,
such Preliminary Prospectus and any amendments thereof and supplements thereto
complied in all material respects with the applicable provisions of the
Securities Act and the Rules and Regulations and did not contain an untrue
statement of a material fact and did not omit to state any 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, provided that the representations and warranties of the
Non-Management Selling Stockholders set forth in this Section 2(j) are limited
solely to statements or omissions made in reliance upon the Non-Management
Selling Stockholder Information for use in the Preliminary Prospectus and any
amendments thereof or supplements thereto. No representation and warranty is
made in this subsection, however, with respect to any
16
information contained in or omitted from the Registration Statement or the
Prospectus or any related Preliminary Prospectus or any amendment thereof or
supplement thereto in reliance upon and in conformity with information furnished
in writing to the Company by or on behalf of any Underwriter through the
Representatives specifically for use therein. For the purposes of this
Agreement, the term "Non-Management Selling Stockholder" means each of the
Selling Stockholders listed on Schedule III hereto.
(k) Such Selling Stockholder has not taken and will not take,
directly or indirectly, any action designed to, or that could be reasonably
expected to, cause or result in stabilization or manipulation of the price of
the Common Stock to facilitate the sale or resale of the Shares or Additional
Shares, if any.
(l) Such Selling Stockholder has not distributed and will not
distribute, prior to the later of the Additional Closing Date, if any, and the
completion of the Underwriters' distribution of the Shares, any offering
material in connection with the offering and sale of the Shares and the
Additional Shares, if any, by the Selling Stockholders other than a Preliminary
Prospectus, the Prospectus or the Registration Statement.
(m) The representations and warranties of such Selling
Stockholder in its Custody Agreement and Power of Attorney are, and on the
Closing Date and Additional Closing Date, if any, will be, true and correct.
Any certificate signed by or on behalf of the Selling Stockholder and
delivered to the Representatives or to counsel for the Underwriters shall be
deemed to be a representation and warranty by such Selling Stockholder to each
Underwriter as to the matters covered thereby.
3. Purchase, Sale and Delivery of the Shares.
(a) On the basis of the representations, warranties, covenants
and agreements herein contained, but subject to the terms and conditions herein
set forth, the Company and each Selling Stockholder, severally and not jointly,
agree to sell to each Underwriter and each Underwriter, severally and not
jointly, agrees to purchase from the Company and the Selling Stockholders, at a
purchase price per share of $_______, the number of Firm Shares set forth
opposite their respective names on Schedule I hereto together with any
additional number of Shares which such Underwriter may become obligated to
purchase pursuant to the provisions of Section 10 hereof.
(b) Payment of the purchase price for, and delivery of
certificates representing, the Firm Shares shall be made at the offices of
Pillsbury Xxxxxxxx Xxxx Xxxxxxx LLP ("Underwriters' Counsel"), or at such other
place as shall be agreed upon by the Representatives and the Company, at 10:00
A.M., New York City time, on the third or, as permitted under Rule 15c6-1 under
the Exchange Act, fourth business day (unless postponed in accordance with the
provisions of Section 10 or 11 hereof) following the date of the effectiveness
of the Registration Statement (or, if the Company has elected to rely upon Rule
430A under the Securities Act, the third or, as permitted under Rule 15c6-1
under the Exchange Act, fourth business day after the determination of the
public offering price of the Shares), or such other time not later than ten
business days after such date as shall be agreed
17
upon by the Representatives and the Company (such time and date of payment and
delivery being herein called the "Closing Date").
Payment of the purchase price for the Firm Shares shall be made by wire
transfer in same day funds to the Company and the Custodian (pursuant to each
Selling Stockholder's Power of Attorney and Custody Agreement), as the case may
be, upon delivery of certificates for the Firm Shares to the Representatives
through the facilities of The Depository Trust Company for the respective
accounts of the several Underwriters. Each Selling Stockholder hereby agrees
that (i) it will pay all stock transfer taxes, stamp duties and other similar
taxes, if any, payable upon the sale or delivery of the Firm Shares to be sold
by the Selling Stockholders to the several Underwriters, or otherwise in
connection with the performance of the Selling Stockholders' obligations
hereunder and (ii) the Custodian is authorized to deduct for such payment any
such amounts from the proceeds to the Selling Stockholders hereunder and to hold
such amounts for the account of the Selling Stockholders with the Custodian
under the Custody Agreement and Power of Attorney. Certificates for the Firm
Shares shall be registered in such name or names and shall be in such
denominations as the Representatives may request at least two business days
before the Closing Date. The Company and the Custodian will permit the
Representatives to examine and package such certificates for delivery at least
one full business day prior to the Closing Date (except for such certificates
representing the Firm Shares to be issued pursuant to the exercise of stock
options by the Selling Stockholders and as to which notices of exercise have
been deposited with the Custodian).
(c) In addition, on the basis of the representations,
warranties, covenants and agreements herein contained, but subject to the terms
and conditions herein set forth, the Selling Stockholders listed on Schedule II
hereto as selling Additional Shares hereby grant to the Underwriters, acting
severally and not jointly, the option to purchase up to ______ Additional Shares
at the same purchase price per share to be paid by the Underwriters to the
Company and the Selling Stockholders for the Firm Shares as set forth in Section
3(a) above, for the sole purpose of covering over-allotments in the sale of Firm
Shares, from each such Selling Stockholder such number of Additional Shares
equal to the number which bears the same ratio to the aggregate number of
Additional Shares being purchased as the number of Additional Shares set forth
opposite the name of such Selling Stockholder in the second column of Schedule
II hereto bears to the total number of Additional Shares set forth in such
column, subject in each case, however, to such adjustments to eliminate any
fractional shares as the Representatives in their sole discretion shall make.
This option may be exercised at any time and from time to time, in whole or in
part on one or more occasions, on or before the thirtieth day following the date
of the Prospectus, by written notice from the Representatives to the Company and
the Selling Stockholders. No Additional Shares shall be sold or delivered unless
the Firm Shares previously have been, or simultaneously are, sold and delivered.
Such notice shall set forth the aggregate number of Additional Shares as to
which the option is being exercised and the date and time, as reasonably
determined by the Representatives, when the Additional Shares are to be
delivered (any such date and time being herein sometimes referred to as the
"Additional Closing Date"); provided, however, that no Additional Closing Date
shall occur earlier than the Closing Date or earlier than the second full
business day after the date on which the option shall have been exercised nor
later than the eighth full business day after the date on which the option shall
have been exercised (unless such time and date are postponed in accordance with
the provisions of Section 10 or 11 hereof). Upon any exercise of the option as
to all or any portion
18
of the Additional Shares, each Underwriter, acting severally and not jointly,
agrees to purchase that proportion of the total number of Additional Shares then
being purchased which the number of Firm Shares set forth opposite the name of
such Underwriter in Schedule I hereto (or such number increased as set forth in
Section 10 hereof) bears to the total number of Firm Shares that the
Underwriters have agreed to purchase hereunder, subject, however, to such
adjustments to eliminate fractional shares as the Representatives in their sole
discretion shall make.
(d) Payment of the purchase price for, and delivery of
certificates representing, the Additional Shares shall be made at the office of
Underwriters' Counsel, or at such other place as shall be agreed upon by the
Representatives and the Selling Stockholders, at 10:00 A.M., New York City time,
on the Additional Closing Date (unless postponed in accordance with the
provisions of Section 10 or 11 hereof), or such other time as shall be agreed
upon by the Representatives and the Selling Stockholders.
Payment for the Additional Shares shall be made to or upon the order of
the Selling Stockholders of the purchase price by wire transfer in Federal (same
day) funds to the Custodian at the offices of Underwriters' Counsel, or such
other location as may be mutually acceptable, upon delivery of the certificates
for the Additional Shares to the Representatives for the respective accounts of
the Underwriters. Each Selling Stockholder hereby agrees that (i) it will pay
all stock transfer taxes, stamp duties and other similar taxes, if any, payable
upon the sale or delivery of the Additional Shares to be sold by the Selling
Stockholders to the several Underwriters, or otherwise in connection with the
performance of the Selling Stockholders' obligations hereunder and (ii) the
Custodian is authorized to deduct for such payment any such amounts from the
proceeds to the Selling Stockholders hereunder and to hold such amounts for the
account of the Selling Stockholders with the Custodian under the Custody
Agreement and Power of Attorney. The Company and the Custodian will permit the
Representatives to examine and package such certificates for delivery at least
one full business day prior to the Additional Closing Date (except for such
certificates representing the Additional Shares to be issued pursuant to the
exercise of stock options by the Selling Stockholders and as to which notices of
exercise have been deposited with the Custodian).
4. Offering. Upon authorization of the release of the Firm Shares by the
Representatives, the Underwriters propose to offer the Shares for sale to the
public upon the terms and conditions set forth in the Prospectus.
5. Covenants of the Company; Covenants of the Selling Stockholders.
(a) The Company covenants and agrees with the Underwriters that:
(i) The Registration Statement and any amendments
thereto have been declared effective, and if Rule 430A is used or the filing of
the Prospectus is otherwise required under Rule 424(b) or Rule 434, the Company
will file the Prospectus (properly completed if Rule 430A has been used)
pursuant to Rule 424(b) within the prescribed time period and will provide
evidence reasonably satisfactory to the Representatives of such timely filing.
If the Company elects to rely on Rule 434, the Company will prepare and file a
term sheet that complies with the requirements of Rule 434, and the Prospectus
shall not be "materially
19
different" (as such term is used in Rule 434) from the Prospectus included in
the Registration Statement at the time it became effective.
The Company will notify you promptly (and, if requested by the
Representatives, will confirm such notice in writing) (A) when the Registration
Statement and any amendments thereto become effective, (B) of any request by the
Commission for any amendment of or supplement to the Registration Statement or
the Prospectus or for any additional information, (C) of the Company's intention
to file or prepare any supplement or amendment to the Registration Statement or
the Prospectus, (D) of the mailing or the delivery to the Commission for filing
of any amendment of or supplement to the Registration Statement or the
Prospectus, including but not limited to Rule 462(b) under the Securities Act,
(E) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or any post-effective amendment
thereto or of the initiation, or the threatening, of any proceedings therefor,
it being understood that the Company shall make every reasonable effort to avoid
the issuance of any such stop order, (F) of the receipt of any comments from the
Commission, and (G) 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 that
purpose. If the Commission shall propose or enter a stop order at any time, the
Company will make every reasonable effort to prevent the issuance of any such
stop order and, if issued, to obtain the lifting of such order as soon as
possible. The Company will not file any amendment to the Registration Statement
or any amendment of or supplement to the Prospectus (including the prospectus
required to be filed pursuant to Rule 424(b) or Rule 434) that differs from the
prospectus on file at the time of the effectiveness of the Registration
Statement or file any document under the Exchange Act if such document would be
deemed to be incorporated by reference into the Prospectus to which the
Representatives shall object in writing after being timely furnished in advance
a copy thereof. The Company will provide the Representatives with copies of all
such amendments, filings and other documents a sufficient time prior to any
filing or other publication thereof to permit the Representatives a reasonable
opportunity to review and comment thereon.
(ii) The Company shall comply with the Securities Act
and the Exchange Act to permit completion of the distribution as contemplated in
this Agreement, the Registration Statement and the Prospectus. If at any time
when a prospectus relating to the Shares is required to be delivered under the
Securities Act or the Exchange Act in connection with the sales of Shares, any
event shall have occurred as a result of which the Prospectus as then amended or
supplemented would, in the reasonable judgment of the Underwriters or the
Company, include an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances existing at the time of delivery to
the purchaser, not misleading, or if to comply with the Securities Act, the
Exchange Act or the Rules and Regulations it shall be necessary at any time to
amend or supplement the Prospectus or Registration Statement, or to file any
document incorporated by reference in the Registration Statement or the
Prospectus or in any amendment thereof or supplement thereto, the Company will
notify you promptly and prepare and file with the Commission, subject to Section
5(a)(i) hereof, an appropriate amendment or supplement (in form and substance
reasonably satisfactory to the Representatives) which will correct such
statement or omission or which will effect such compliance and will use its
20
reasonable best efforts to have any amendment to the Registration Statement
declared effective as soon as possible.
(iii) The Company will promptly deliver to each of you
and Underwriters' Counsel a signed or conformed copy of the Registration
Statement, as initially filed and all amendments thereto, including all consents
and exhibits filed therewith, and will maintain in the Company's files manually
signed copies of such documents for at least five years after the date of
filing. The Company will promptly deliver to each of the Underwriters such
number of copies of any Preliminary Prospectus, the Prospectus, the Registration
Statement, and all amendments of and supplements to such documents, if any, and
all documents incorporated by reference in the Registration Statement and
Prospectus or any amendment thereof or supplement thereto, as you may reasonably
request. Prior to 10:00 A.M., New York time, on the business day next succeeding
the date of this Agreement, or as promptly as reasonably possible thereafter,
and from time to time thereafter, the Company will furnish the Underwriters with
copies of the Prospectus in New York City in such quantities as you may
reasonably request.
(iv) The Company consents to the use and delivery of the
Preliminary Prospectus by the Underwriters in accordance with Rule 430 and
Section 5(b) of the Securities Act.
(v) The Company will use its reasonable best efforts, in
cooperation with the Representatives, at or prior to the time of effectiveness
of the Registration Statement, to qualify the Shares for offering and sale under
the securities laws relating to the offering or sale of the Shares of such
jurisdictions, domestic or foreign, as the Representatives may designate and to
maintain such qualification in effect for so long as required for the
distribution thereof; except that in no event shall the Company be obligated in
connection therewith to become subject to taxation, to qualify as a foreign
corporation or to execute a general consent to service of process in such
jurisdiction.
(vi) The Company will make generally available to its
security holders and to the Underwriters as soon as practicable an earnings
statement of the Company and the Subsidiaries (which need not be audited)
complying with Section 11(a) of the Securities Act and Rule 158 under the Act.
(vii) During the period of 90 days from the date of the
Prospectus, without the prior written consent of Bear Xxxxxxx, the Company (A)
will not, directly or indirectly, issue, offer, sell, agree to issue, offer or
sell, solicit offers to purchase, grant any call option, warrant or other right
to purchase, purchase any put option or other right to sell, pledge, borrow or
otherwise dispose of any Relevant Security, or make any announcement of any of
the foregoing, (B) will not establish or increase any "put equivalent position"
or liquidate or decrease any "call equivalent position" (in each case within the
meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder) with respect to any Relevant Security, and (C) will not
otherwise enter into any swap, derivative or other transaction or arrangement
that transfers to another, in whole or in part, any economic consequence of
ownership of a Relevant Security, whether or not such transaction is to be
settled by delivery of Relevant Securities, other securities, cash or other
consideration, other than (i) the sale of Shares as contemplated by this
Agreement, (ii) the Company's issuance of Common Stock upon the
21
grant and exercise of options under, or the issuance and sale of shares pursuant
to, employee stock option or benefit plans in effect on the date hereof, or
(iii) the grant by the Company of any options, warrants, restricted stock or
other securities pursuant to the terms of any option plan, long-term incentive
plan, employee benefit or compensation arrangement or employment agreement; and
the Company will obtain an undertaking in substantially the form of Annex III
hereto of each of its executive officers, directors and the Selling Stockholders
not to engage in any of the aforementioned transactions on their own behalf.
During the period of 90 days from the date of the Prospectus, without the prior
written consent of Bear Xxxxxxx, the Company will not file a registration
statement under the Securities Act in connection with any transaction by the
Company or any person that is prohibited pursuant to the foregoing, except for
registration statements on Form S-8 relating to employee benefit plans or Form
S-4 relating to corporate reorganizations or other transactions under Rule 145.
(viii) During the period of three years from the
effective date of the Registration Statement, the Company will furnish to the
Representatives copies of all reports or other communications (financial or
other) furnished generally to security holders or from time to time published or
publicly disseminated by the Company, and will deliver to the Representatives
(i) as soon as they are available, copies of any reports, financial statements
and proxy or information statements furnished to or filed with the Commission or
any national securities exchange on which any class of securities of the Company
is listed; and (ii) such additional information concerning the business and
financial condition of the Company as the Representatives may from time to time
reasonably request (such financial information to be on a consolidated basis to
the extent the accounts of the Company and the Subsidiaries are consolidated in
reports furnished to its security holders generally or to the Commission),
provided that the Representatives agree to keep such additional information
confidential (and to cause their employees and agents to do the same) prior to
its publication or public dissemination by the Company. For the purposes of this
Section 5(a)(viii), items filed by the Company with the Commission on XXXXX will
be deemed to have been furnished to the Representatives on the date of such
filing.
(ix) The Company will apply the net proceeds from the
sale of the Shares as set forth under the caption "Use of Proceeds" in the
Prospectus.
(x) The Company will use its reasonable best efforts to
list the Shares for quotation on the NASDAQ and maintain the listing of the
Shares on the NASDAQ.
(xi) The Company, during the period when the Prospectus
is required to be delivered under the Securities Act or the Exchange Act, will
file all documents required to be filed with the Commission pursuant to the
Securities Act, the Exchange Act and the Rules and Regulations within the time
periods required thereby.
(xii) The Company will use its reasonable best efforts
to do and perform all things required to be done or performed under this
Agreement by the Company prior to the Closing Date or the Additional Date, as
the case may be, and to satisfy all conditions precedent required to be
satisfied by the Company to the delivery of the Firm Shares and the Additional
Shares.
22
(xiii) The Company will not take, and will cause its
affiliates (within the meaning of Rule 144 under the Securities Act) not to
take, directly or indirectly, any action which constitutes or is designed to
cause or result in, or which would reasonably be expected to constitute, cause
or result in, the stabilization or manipulation of the price of any security to
facilitate the sale or resale of the Shares.
(b) Each Selling Stockholder severally and not jointly covenants
and agrees with each Underwriter:
(i) To deliver to the Representatives prior to the
Closing Date, a properly completed and executed United States Treasury
Department Form W-8 (if the Selling Stockholder is a non-United States Person)
or Form W-9 (if the Selling Stockholder is a United States Person), which in
each case may be replaced by any other applicable form or statement specified by
Treasury Department regulations in lieu thereof;
(ii) To notify promptly the Company and the
Representatives if, at any time prior to the date on which the distribution of
the Shares as contemplated herein and in the Prospectus has been completed, as
determined by the Representatives, such Selling Stockholder has knowledge of the
occurrence of any event as a result of which the Prospectus or the Registration
Statement, in each case as then amended or supplemented, would include an untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading;
(iii) To cooperate to the extent necessary to cause the
Registration Statement or any post-effective amendment thereto to become
effective at the earliest possible time and to use reasonable best efforts to do
and perform all things to be done and performed under this Agreement by the
Selling Stockholders prior to the Closing Date and the Additional Closing Date,
if any, and to satisfy all conditions precedent required to be satisfied by the
Selling Stockholders to the delivery of the Selling Stockholders' Shares and the
Additional Shares pursuant to this Agreement;
(iv) To pay or to cause to be paid all transfer taxes,
stamp duties and other similar taxes with respect to the Selling Stockholders'
Shares and the Additional Shares, if any, to be sold by such Selling
Stockholder; and
(v) To deliver to the Representatives on or prior to the
date of this Agreement a lock-up agreement executed by such Selling Stockholder
referenced in Section 7(k) hereof.
6. Payment of Expenses. Whether or not the transactions contemplated by
this Agreement, the Registration Statement and the Prospectus are consummated or
this Agreement is terminated, the Company hereby agrees to pay all costs and
expenses incident to the performance of the Company's obligations hereunder,
including the following: (i) all expenses in connection with the preparation,
printing and filing of the Registration Statement, any Preliminary Prospectus
and the Prospectus and any and all amendments and supplements thereto and the
mailing and delivering of copies thereof to the Underwriters and dealers; (ii)
the fees, disbursements and expenses of the Company's counsel and accountants in
connection with
23
the registration of the Shares under the Securities Act and the Offering; (iii)
the cost of producing this Agreement and any agreement among Underwriters, blue
sky survey, closing documents and other instruments, agreements or documents
(including any compilations thereof) in connection with the Offering; (iv) all
expenses in connection with the qualification of the Shares for offering and
sale under applicable state or foreign securities or blue sky laws as provided
in Section 5(a)(v) hereof, including the fees and disbursements of counsel for
the Underwriters in connection with such qualification and in connection with
any blue sky survey; (v) the filing fees incident to and the fees and
disbursements of counsel for the Underwriters in connection with securing any
required review by the NASD of the terms of the Offering; (vi) all fees and
expenses in connection with listing the Shares on the NASDAQ; (vii) all travel
expenses of the Company's officers and employees and any other expense of the
Company incurred in connection with attending or hosting meetings with
prospective purchasers of the Shares; and (viii) any stock transfer taxes
incurred in connection with this Agreement or the Offering. The Company also
will pay or cause to be paid: (x) the cost of preparing stock certificates
representing the Shares; (y) the cost and charges of any transfer agent or
registrar for the Shares; and (z) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section 6 It is understood, however, that except as
provided in this Section, and Sections 8, 9 and 13 hereof, the Underwriters will
pay all of their own costs and expenses, including the fees of their counsel and
stock transfer taxes on resale of any of the Shares by them. Notwithstanding
anything to the contrary in this Section 6, in the event that this Agreement is
terminated pursuant to Section 7 or 13(b) hereof, or subsequent to a Material
Adverse Change, the Company will pay all out-of pocket expenses of the
Underwriters (including but not limited to fees and disbursements of counsel to
the Underwriters) incurred in connection herewith.
The Selling Stockholders will pay all fees and expenses directly related
to the offering of the Shares to be sold by them, including (i) the fees and
disbursements of their counsel, if any, (ii) the fees of the Custodian and other
fees and expenses related to the offering of Shares by the Selling Stockholders,
and (iii) any applicable stock transfer or other taxes related to the offering
of their Shares. Notwithstanding the foregoing, nothing herein shall affect any
agreement that the Company and the Selling Stockholders may make for the sharing
or allocation of such costs and expenses.
7. Conditions of Underwriters' Obligations. The obligations of the
Underwriters to purchase and pay for the Firm Shares and the Additional Shares,
as provided herein, shall be subject to the accuracy of the representations and
warranties of the Company and the Selling Stockholders herein contained, as of
the date hereof and as of the Closing Date (for purposes of this Section 7
"Closing Date" shall refer to the Closing Date for the Firm Shares and any
Additional Closing Date, if different, for the Additional Shares), to the
absence from any certificates, opinions, written statements or letters furnished
to the Representatives or to Underwriters' Counsel pursuant to this Section 7 of
any misstatement or omission, to the performance by the Company and the Selling
Stockholders of their respective obligations hereunder, and to each of the
following additional conditions:
(a) The Registration Statement shall have become effective and
all necessary regulatory or stock exchange approvals shall have been received
not later than [if pricing pursuant to Rule 430A: 5:30 P.M., New York time, on
the date of this Agreement] [if
24
pricing pursuant to a pricing amendment: 12:00 P.M., New York time on the date
an amendment to the Registration Statement containing the public offering price
has been filed with the Commission], or at such later time and date as shall
have been consented to in writing by the Representatives; if the Company shall
have elected to rely upon Rule 430A or Rule 434 under the Securities Act, the
Prospectus shall have been filed with the Commission in a timely fashion in
accordance with Section 5(a)(i) hereof and a form of the Prospectus containing
information relating to the description of the Shares and the method of
distribution and similar matters shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period; and, at or prior to
the Closing Date no stop order suspending the effectiveness of the Registration
Statement or any post-effective amendment thereof shall have been issued and no
proceedings therefor shall have been initiated or threatened by the Commission.
(b) At the Closing Date, the Representatives shall have received
the favorable written opinions of Paul, Hastings, Xxxxxxxx & Xxxxxx LLP and
Xxxxxxxx and Wedge, counsel for the Company, dated the Closing Date addressed to
the Underwriters substantially in the form attached hereto as Annex I.
(c) At the Closing Date, the Representatives shall have received
the favorable written opinion of Xxxxx & Xxxxxx LLP, Xxxxx & Xxxxxx LLP and
Xxxxxxx Xxxx & Friedrich LLP, counsel to the Selling Stockholders, dated the
Closing Date, addressed to the Underwriters substantially in the form attached
hereto as Annex II.
(d) All proceedings taken in connection with the sale of the
Firm Shares and the Additional Shares as herein contemplated shall be reasonably
satisfactory in form and substance to the Representatives and to Underwriters'
Counsel, and the Underwriters shall have received from Underwriters' Counsel a
favorable written opinion, dated as of the Closing Date, with respect to the
issuance and sale of the Shares, the Registration Statement and the Prospectus
and such other related matters as the Representatives may reasonably require,
and the Company shall have furnished to Underwriters' Counsel such documents as
they may reasonably request for the purpose of enabling them to pass upon such
matters.
(e) At the Closing Date, the Representatives shall have received
a certificate of the Chief Executive Officer and Chief Financial Officer of the
Company, dated the Closing Date, in their capacities as such officers on behalf
of the Company that, to the best of their knowledge, that (i) the condition set
forth in subsection (a) of this Section 7 has been satisfied, (ii) as of the
date hereof and as of the Closing Date, the representations and warranties of
the Company set forth in Section 1 hereof are accurate, (iii) as of the Closing
Date all agreements, conditions and obligations of the Company to be performed
or complied with hereunder on or prior thereto have been duly performed or
complied with in all material respects, (iv) the Company and the Subsidiaries
have not sustained any material loss or interference with their respective
businesses or properties from fire, flood, hurricane, accident or other
calamity, whether or not covered by insurance, or from any labor dispute or any
legal or governmental proceeding, (v) no stop order suspending the effectiveness
of the Registration Statement or any post-effective amendment thereof has been
issued and no proceedings therefor have been initiated or, to the Company's
knowledge, threatened by the Commission, and (vi) subsequent to the respective
dates as of which information is given in the Registration Statement and the
25
Prospectus there has not been any Material Adverse Change or any development
that has had a Material Adverse Effect, except in each case as disclosed in the
Prospectus.
(f) At the time this Agreement is executed and at the Closing
Date, the Representatives shall have received a comfort letter, from X. X. Xxxx
LLP, independent public accountants for the Company, dated, respectively, as of
the date of this Agreement and as of the Closing Date addressed to the
Underwriters and in form and substance satisfactory to the Underwriters and
Underwriters' Counsel.
(g) The Representatives shall have received a duly executed
lock-up agreement from each person who is a director or executive officer of the
Company and each Selling Stockholder, in each case substantially in the form
attached hereto as Annex III.
(h) At the Closing Date, the Shares shall have been approved for
quotation on the NASDAQ.
(i) At the Closing Date, the NASD shall have confirmed, to the
extent necessary, that it has not raised any objection with respect to the
fairness and reasonableness of the underwriting terms and arrangements.
(j) No action shall have been taken and no statute, rule,
regulation or order shall have been enacted, adopted or issued by any federal,
state or foreign governmental or regulatory authority that would, as of the
Closing Date, prevent the issuance or sale of the Shares; and no injunction or
order of any federal, state or foreign court shall have been issued that would,
as of the Closing Date, prevent the issuance or sale of the Firm Shares.
(k) At the Closing Date, the Representatives shall have received
a certificate of each Selling Stockholder or an authorized representative of
such Selling Stockholder, dated the Closing Date, to the effect that the
representations and warranties of the such Selling Stockholder set forth in
Section 2 hereof are accurate and that each such Selling Stockholder has
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing Date.
(l) On or prior to the Closing Date, the Representatives shall
have received 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) from each Selling Stockholder.
(m) The Company shall have furnished the Underwriters and
Underwriters' Counsel with such other certificates, opinions or other documents
as they may have reasonably requested.
If any of the conditions specified in this Section 7 shall not have been
fulfilled when and as required by this Agreement, or if any of the certificates,
opinions, written statements or letters furnished to the Representatives or to
Underwriters' Counsel pursuant to this Section 7 shall not be reasonably
satisfactory in form and substance to the Representatives and to Underwriters'
Counsel, all obligations of the
26
Underwriters hereunder may be cancelled by the Representatives at, or at any
time prior to, the Closing Date and the obligations of the Underwriters to
purchase the Additional Shares may be cancelled by the Representatives at, or at
any time prior to, the Additional Closing Date. Notice of such cancellation
shall be given to the Company in writing, or by telephone. Any such telephone
notice shall be confirmed promptly thereafter in writing.
8. Indemnification.
(a) The Company and each Management Selling Stockholder jointly
and severally shall 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, liabilities, claims, damages and expenses whatsoever as reasonably
incurred (including but not limited to attorneys' fees and any and all
out-of-pocket expenses whatsoever incurred in investigating, preparing or
defending against any litigation, commenced or threatened, or any claim
whatsoever, provided that the Company and each Management Selling Stockholder
shall not be liable for the fees and expenses of more than one law firm, in
addition to local counsel), joint or several, to which they or any of them may
become subject under the Securities Act, the Exchange Act or otherwise, insofar
as such losses, liabilities, claims, damages or expenses (or actions in respect
thereof) arise out of or are based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in (A) the Registration Statement,
as originally filed or any amendment thereof, or any related Preliminary
Prospectus or the Prospectus, or in any supplement thereto or amendment thereof,
or (B) in any materials or information provided to investors by, or with the
approval of, the Company in connection with the marketing of the offering of the
Shares, including any road show or investor presentations made to investors by
the Company (whether in person or electronically) ("Marketing Materials"), or
(ii) the omission or alleged omission to state in the Registration Statement, as
originally filed or any amendment thereof, or any related Preliminary Prospectus
or the Prospectus, or in any supplement thereto or amendment thereof, or in any
Marketing Materials, a material fact required to be stated therein or necessary
to make the statements therein (in light of the circumstances under which they
were made, in the case of any prospectus) not misleading; provided, however,
that none of the Company or the Management Selling Stockholders will be liable
in any such case to the extent but only to the extent that any such loss,
liability, claim, damage or expense arises out of or is based upon any untrue
statement or alleged untrue statement or omission or alleged omission made in
the Registration Statement, as originally filed or any amendment thereof, or any
related Preliminary Prospectus or the Prospectus, or in any supplement thereto
or amendment thereof, in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any Underwriter through
the Representatives or by or on behalf of the Non-Management Selling
Stockholders specifically for use therein; provided, further, that no Management
Selling Stockholder shall be responsible for losses, liabilities, claims,
damages or expenses (or actions in respect thereof) for an amount in excess of
the proceeds to be received by such Management Selling Stockholder (after
deducting the Underwriters' discounts and commissions, but before deducting
expenses) from the sale of Shares hereunder. The parties agree that such
information provided by or on behalf of any Underwriter through the
Representatives consists solely of the material referred to in the last sentence
of Section 1(b) hereof. This indemnity agreement will be in addition to any
liability which the Company or any Management Selling Stockholder may otherwise
have, including but not limited to other liability under this Agreement. The
foregoing indemnity agreement with respect to any Preliminary Prospectus shall
not inure to the benefit of
27
any Underwriter who failed to deliver a Prospectus (as then amended or
supplemented, provided by the Company to the several Underwriters in accordance
with this Agreement) to the person asserting any losses, liabilities, claims,
damages and expenses and judgments caused by any untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, or
caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein (in
light of the circumstances under which they were made, in the case of any
Prospectus) not misleading, if such material misstatement or omission or alleged
material misstatement or omission was cured, as determined by a court of
competent jurisdiction in a decision not subject to further appeal, in such
Prospectus and such Prospectus was required by law to be delivered at or prior
to the written confirmation of sale to such person. For the purposes of this
Agreement, the term "Management Selling Stockholder" means the executive
officers of the Company and the entity controlled by such executive officers, in
each case as listed on Schedule IV hereto.
(b) Each Non-Management Selling Stockholder, severally and not
jointly, shall indemnify and hold harmless the Company, each of its directors
and officers and each person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange
Act, each Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the Securities Act or Section 20(a) of the
Exchange Act, against any and all losses, liabilities, claims, damages and
expenses whatsoever as reasonably incurred (including but not limited to
reasonable attorneys' fees and any and all out-of-pocket expenses whatsoever
incurred in investigating, preparing or defending against any litigation,
commenced or threatened, or any claim whatsoever, provided, that no
Non-Management Selling Stockholder shall be liable for fees and expenses of more
than one law firm, in addition to local counsel), joint or several, to which
they or any of them may become subject under the Securities Act, the Exchange
Act or otherwise, insofar as such losses, liabilities, claims, damages or
expenses (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact of the
Non-Management Selling Stockholder Information of such Non-Management Selling
Stockholder contained in the Registration Statement for the registration of the
Shares, as originally filed or any amendment thereof, or any related Preliminary
Prospectus or the Prospectus, or in any supplement thereto or amendment thereof,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact of Non-Management Selling Stockholder Information of
such Non-Management Selling Stockholder required to be stated therein or
necessary to make the statements therein (in light of the circumstances under
which they were made, in the case of any Prospectus) not misleading; provided,
however, that no Non-Management Selling Stockholder shall be responsible for
losses, liabilities, claims, damages or expenses (or actions in respect thereof)
arising out of or based upon any untrue statement or alleged untrue statement of
a material fact other than the Non-Management Selling Stockholder Information of
such Non-Management Selling Stockholder; provided, further, the Non-Management
Selling Stockholders will not be liable in any such case to the extent but only
to the extent that any such loss, liability, claim, damage or expense arises out
of or is based upon any such untrue statement or alleged untrue statement or
omission or alleged omission made therein in reliance upon and in conformity
with written information furnished to the Company by or on behalf of any
Underwriter through the Representatives expressly for use therein (as described
in the last sentence of Section 1(b) hereof). This indemnity will be in addition
to any liability that any
28
Non-Management Selling Stockholder may otherwise have, including but not limited
to other liability under this Agreement.
(c) Each Underwriter, severally and not jointly, shall indemnify
and hold harmless the Company, each Selling Stockholder, each of the directors
of the Company, each of the officers of the Company who shall have signed the
Registration Statement, and each other person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, against any losses, liabilities, claims, damages and expenses
whatsoever as reasonably incurred (including but not limited to attorneys' fees
and any and all out-of-pocket expenses whatsoever incurred in investigating,
preparing or defending against any litigation, commenced or threatened, or any
claim whatsoever, provided, that no Underwriter shall be liable for fees and
expenses of more than one law firm, in addition to local counsel), joint or
several, to which they or any of them may become subject under the Securities
Act, the Exchange Act or otherwise, insofar as such losses, liabilities, claims,
damages or expenses (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, as originally filed or any amendment
thereof, or any related Preliminary Prospectus or the Prospectus, or in any
supplement thereto or amendment thereof, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein (in light of the
circumstances under which they were made, in the case of any Prospectus) not
misleading, in each case to the extent, but only to the extent, that any such
loss, liability, claim, damage or expense arises out of or is based upon any
such untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of any Underwriter through
the Representatives specifically for use therein; provided, however, that in no
case shall any Underwriter be liable or responsible for any amount in excess of
the underwriting discount applicable to the Shares to be purchased by such
Underwriter hereunder. The parties agree that such information provided by or on
behalf of any Underwriter through the Representatives consists solely of the
material referred to in the last sentence of Section 1(b) hereof. This indemnity
will be in addition to any liability which any Underwriter may otherwise have,
including but not limited to other liability under this Agreement.
(d) Promptly after receipt by an indemnified party under
subsection (a), (b) or (c) above of notice of any claims or the commencement of
any action, such indemnified party shall, if a claim in respect thereof is to be
made against the indemnifying party under such subsection, notify each party
against whom indemnification is to be sought in writing of the claim or the
commencement thereof (but the failure so to notify an indemnifying party shall
not relieve the indemnifying party from any liability which it may have under
this Section 8 to the extent that it is not materially prejudiced as a result
thereof and in any event shall not relieve it from any liability that such
indemnifying party may have otherwise than on account of the indemnity agreement
hereunder). In case any such claim or action is brought against any indemnified
party, and it notifies an indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate, at its own expense in the
defense of such action, and to the extent it may elect by written notice
delivered to the indemnified party promptly after receiving the aforesaid notice
from such indemnified party, to assume the defense thereof with counsel
reasonably satisfactory to such indemnified party; provided, however, that
counsel to the indemnifying party shall not (except with the written consent of
the indemnified
29
party) also be counsel to the indemnified party; and after notice from the
indemnifying party is given to such indemnified party of its election to so
assume the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof. Notwithstanding the foregoing, the indemnified party or parties shall
have the right to employ its or their own counsel in any such case, but the fees
and expenses of such counsel shall be at the expense of such indemnified party
or parties unless (i) the employment of such counsel shall have been authorized
in writing by the indemnifying parties in connection with the defense of such
action, (ii) the indemnifying parties shall not have employed counsel to have
charge of the defense of such action within a reasonable time after notice of
commencement of the action, (iii) the indemnifying party does not diligently
defend the action after assumption of the defense, or (iv) such indemnified
party or parties shall have been advised by counsel that there may be defenses
available to it or them which are different from or additional to those
available to one or all of the indemnifying parties, and in the reasonable
judgment of such counsel it is advisable for such indemnified party to engage
separate counsel (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
parties), in any of which events such fees and expenses shall be borne by the
indemnifying parties; it being understood, however, that the indemnifying
parties shall not, in connection with any one such action or separate but
substantially similar or related actions arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys at any time for all such indemnified
parties (in addition to any local counsel) and indemnifying party shall not be
liable for any settlement of any proceeding effected without its written
consent. No indemnifying party shall, without the prior written consent of the
indemnified parties, effect any settlement or compromise of, or consent to the
entry of judgment with respect to, any pending or threatened claim,
investigation, action or proceeding in respect of which indemnity or
contribution may be or could have been sought by an indemnified party under this
Section 8 or Section 9 hereof (whether or not the indemnified party is an actual
or potential party thereto), unless (x) such settlement, compromise or judgment
(i) includes an unconditional release of the indemnified party from all
liability arising out of such claim, investigation, action or proceeding and
(ii) does not include a statement as to or an admission of fault, culpability or
any failure to act, by or on behalf of the indemnified party, and (y) the
indemnifying party confirms in writing its indemnification obligations hereunder
with respect to such settlement, compromise or judgment.
9. Contribution. In order to provide for contribution in circumstances
in which the indemnification provided for in Section 8 hereof is for any reason
held to be unavailable from any indemnifying party or is insufficient to hold
harmless a party indemnified thereunder, the Company and the Selling
Stockholders, on the one hand, and the Underwriters, on the other hand, shall
contribute to the aggregate losses, claims, damages, liabilities and expenses of
the nature contemplated by such indemnification provision (including any
investigation, legal and other expenses incurred in connection with, and any
amount paid in settlement of, any action, suit or proceeding or any claims
asserted, but after deducting in the case of losses, claims, damages,
liabilities and expenses suffered by the Company and any Selling Stockholder,
any contribution received by the Company and any Selling Stockholder from
persons, other than the Underwriters, who may also be liable for contribution,
including persons who control the Company or any Selling Stockholder within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
officers of the Company who signed the
30
Registration Statement and directors of the Company) as reasonably incurred to
which the Company, and any Selling Stockholder and one or more of the
Underwriters may be subject, in such proportions as is appropriate to reflect
the relative benefits received by the Company and the Selling Stockholders, on
the one hand, and the Underwriters, on the other hand, from the Offering or, if
such allocation is not permitted by applicable law, in such proportions as are
appropriate to reflect not only the relative benefits referred to above but also
the relative fault of the Company and the Selling Stockholders, on the one hand,
and the Underwriters, on the other hand, 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 Selling Stockholders, on the one hand,
and the Underwriters, on the other hand, shall be deemed to be in the same
proportion as (x) the total proceeds from the Offering (net of underwriting
discounts and commissions but before deducting expenses) received by the Company
and the Selling Stockholders bears to (y) the underwriting discount or
commissions received by the Underwriters, in each case as set forth in the table
on the cover page of the Prospectus. The relative fault of each of the Company
and the Selling Stockholders, on the one hand, and of the Underwriters, on the
other hand, 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
and the Selling Stockholders, on the one hand, or the Underwriters, on the other
hand, and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company, the
Selling Stockholders and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 9 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 this Section. The aggregate amount
of losses, liabilities, claims, damages and expenses incurred by an indemnified
party and referred to above in this Section 9 shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any judicial, regulatory or other legal or
governmental agency or body, commenced or threatened, or any claim whatsoever
based upon any such untrue or alleged untrue statement or omission or alleged
omission. Notwithstanding the provisions of this Section 9, (i) no Underwriter
shall be required to contribute any amount in excess of the amount by which the
discounts and commissions applicable to the Shares underwritten by it and
distributed to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission and (ii) 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 9,
each person, if any, who controls an Underwriter within the meaning of Section
15 of the Securities Act or Section 20 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 Section 15 of the Securities Act or
Section 20 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 and any Selling Stockholder, as
applicable, subject in each case to clauses (i) and (ii) of the immediately
preceding sentence. Any party entitled to contribution will, promptly after
receipt of notice of commencement of any action, suit or proceeding against
31
such party in respect of which a claim for contribution may be made against
another party or parties, notify each party or parties from whom contribution
may be sought, but the omission to so notify such party or parties shall not
relieve the party or parties from whom contribution may be sought from any
obligation it or they may have under this Section 9 or otherwise to the extent
that it is not materially prejudiced as a result thereof. The obligations of the
Company and the Selling Stockholders to contribute pursuant to this Section 9
are several, and not joint.. The obligations of the Underwriters to contribute
pursuant to this Section 9 are several in proportion to the respective number of
Shares to be purchased by each of the Underwriters hereunder and not joint.
10. Underwriter Default.
(a) If any Underwriter or Underwriters shall default in its or
their obligation to purchase Firm Shares or Additional Shares hereunder, and if
the Firm Shares or Additional Shares with respect to which such default relates
(the "Default Shares") do not (after giving effect to arrangements, if any, made
by the Representatives pursuant to subsection (b) below) exceed in the aggregate
10% of the number of Firm Shares or Additional Shares, each non-defaulting
Underwriter, acting severally and not jointly, agrees to purchase from the
Company that number of Default Shares that bears the same proportion of the
total number of Default Shares then being purchased as the number of Firm Shares
set forth opposite the name of such Underwriter in Schedule I hereto bears to
the aggregate number of Firm Shares set forth opposite the names of the
non-defaulting Underwriters, subject, however, to such adjustments to eliminate
fractional shares as the Representatives in their sole discretion shall make.
(b) In the event that the aggregate number of Default Shares
exceeds 10% of the number of Firm Shares or Additional Shares, as the case may
be, the Representatives may in their discretion arrange for the Representatives,
or any of them, or for another party or parties (including any non-defaulting
Underwriter or Underwriters who so agree) to purchase the Default Shares on the
terms contained herein. In the event that within five calendar days after such a
default the Representatives do not arrange for the purchase of the Default
Shares as provided in this Section 10, this Agreement or, in the case of a
default with respect to the Additional Shares, the obligations of the
Underwriters to purchase and of the Company to sell the Additional Shares shall
thereupon terminate, without liability on the part of the Company or the Selling
Stockholders with respect thereto (except in each case as provided in Sections
6, 8, 9, 12 and 13) or the Underwriters, but nothing in this Agreement shall
relieve a defaulting Underwriter or Underwriters of its or their liability, if
any, to the other Underwriters, the Company and the Selling Stockholders for
damages occasioned by its or their default hereunder.
(c) In the event that any Default Shares are to be purchased by
the non-defaulting Underwriters, or are to be purchased by another party or
parties as aforesaid, the Representatives or the Company shall have the right to
postpone the Closing Date or Additional Closing Date, as the case may be for a
period, not exceeding five business days, in order to effect whatever changes
may thereby be made necessary in the Registration Statement or the Prospectus or
in any other documents and arrangements, and the Company agrees to file promptly
any amendment or supplement to the Registration Statement or the Prospectus
which, in the reasonable opinion of Underwriters' Counsel and the Company's
counsel, may thereby be made necessary or advisable. The term "Underwriter" as
used in this Agreement shall include
32
any party substituted under this Section 10 with like effect as if it had
originally been a party to this Agreement with respect to such Firm Shares and
Additional Shares.
11. Selling Stockholder Default.
(a) If any Selling Stockholder or Selling Stockholders shall
default in its or their obligation to sell and deliver any Shares hereunder,
then the non-defaulting Selling Stockholders and any of them may elect to sell
to the Underwriters some or all of the Shares to be sold by the defaulting
Selling Stockholder or Selling Stockholders (or in the Representatives'
discretion, to permit the Company to sell such Shares). In the event the
non-defaulting Selling Stockholders do not elect to sell such Shares or, if the
Representatives shall have so consented, the Company does not elect to sell such
Shares to the Underwriters within five business days, the Representatives may,
by notice to the Company, terminate this Agreement without any liability on the
part of any non-defaulting party except that the provisions of Sections 1, 2, 6,
8, 9, 12 and 13 hereof shall remain in full force and effect. No action taken
pursuant to this Section 11 shall relieve any Selling Stockholder so defaulting
from liability, if any, in respect of such default.
(b) In the event that such default occurs and the Selling
Stockholders elect or, if the Representatives shall have so consented, the
Company arranges to sell such Shares to the Underwriters or the Company and
Underwriters otherwise agree to proceed with the Offering, then the Underwriters
may, at the option of the Representatives, or the Company shall have the right,
in each case by notice to the other, to postpone the Closing Date or Additional
Closing Date, as the case may be, for a period not exceeding five business days,
in order to effect whatever changes may thereby be made necessary in the
Registration Statement or the Prospectus or in any other documents and
arrangements, and the Company agrees to file promptly any amendment or
supplement to the Registration Statement or the Prospectus which, in the
reasonable opinion of Underwriters' Counsel and the Company's Counsel, may
thereby be made necessary or advisable; and in no event shall the Company be
obligated to increase the number of Shares it is required to sell hereunder.
12. Survival of Representations and Agreements. All representations and
warranties, covenants and agreements of the Underwriters, the Company and the
Selling Stockholders, contained in this Agreement or in certificates of officers
of the Company or any Subsidiary or of the Selling Stockholders submitted
pursuant hereto, including the agreements contained in Section 6, the indemnity
agreements contained in Section 8 and the contribution agreements contained in
Section 9, shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of any Underwriter or any controlling person
thereof or by or on behalf of the Company or any Selling Stockholder, any of
their officers and directors or any controlling person thereof, and shall
survive delivery of and payment for the Shares to and by the Underwriters.
13. Effective Date of Agreement; Termination.
(a) This Agreement shall become effective upon the later of (i)
receipt by the Representatives, and the Company of notification of the
effectiveness of the Registration Statement or (ii) the execution of this
Agreement. If either the public offering price or the
33
purchase price per Share has not been agreed upon prior to 5:00 p.m., New York
City time, on the fifth full business day after the Registration Statement shall
have become effective, this Agreement shall thereupon terminate without
liability to the Company, the Selling Stockholders or the Underwriters except as
herein expressly provided. Notwithstanding any termination of this Agreement,
the provisions of this Section 13 and of Sections 1, 2, 6, 8, 9 and 12 and 14
through 19, inclusive, shall remain in full force and effect at all times after
the execution hereof.
(b) The Representatives shall have the right to terminate this
Agreement at any time prior to the Closing Date or to terminate the obligations
of the Underwriters to purchase the Additional Shares at any time prior to the
Additional Closing Date, as the case may be, if (i) any domestic or
international event or act or occurrence has materially disrupted, or in the
opinion of the Representatives will in the immediate future materially disrupt,
the market for the Company's securities or securities in general; or (ii)
trading on The New York Stock Exchange (the "NYSE") or The Nasdaq National
Market (the "NASDAQ") shall have been suspended or been made subject to material
limitations, or minimum or maximum prices for trading shall have been fixed, or
maximum ranges for prices for securities shall have been required, on the NYSE
or the NASDAQ or by order of the Commission or any other governmental authority
having jurisdiction; or (iii) a banking moratorium has been declared by any
state or federal authority or if any material disruption in commercial banking
or securities settlement or clearance services shall have occurred; or (iv) (A)
there shall have occurred any outbreak or escalation of hostilities or acts of
terrorism involving the United States or there is a declaration of a national
emergency or war by the United States or (B) there shall have been any other
calamity or crisis or any change in political, financial or economic conditions
if the effect of any such event in (A) or (B), in the judgment of the
Representatives, makes it impracticable or inadvisable to proceed with the
offering, sale and delivery of the Firm Shares or the Additional Shares, as the
case may be, on the terms and in the manner contemplated by the Prospectus.
(c) Any notice of termination pursuant to this Section 13 shall
be in writing.
(d) If this Agreement shall be terminated pursuant to any of the
provisions hereof (other than pursuant to (i) notification by the
Representatives as provided in Section 11(a) hereof or (ii) Section 10(b)
hereof), or if the sale of the Shares provided for herein is not consummated
because any condition to the obligations of the Underwriters set forth herein is
not satisfied or because of any refusal, inability or failure on the part of the
Company and the Selling Stockholders to perform any agreement herein or comply
with any provision hereof, the Company will, subject to demand by the
Representatives, reimburse the Underwriters for all out-of-pocket expenses
(including the reasonable fees and expenses of their counsel), incurred by the
Underwriters in connection herewith.
14. Notices. All communications hereunder, except as may be otherwise
specifically provided herein, shall be in writing, and:
(a) if sent to any Underwriter, shall be mailed, delivered, or
faxed and confirmed in writing, to such Underwriter c/o Bear, Xxxxxxx & Co.
Inc., 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxx Parish,
Senior Managing Director, Equity Capital Markets, with a copy to Underwriter's
Counsel at Pillsbury Xxxxxxxx Xxxx
34
Xxxxxxx LLP, 00 Xxxxxxx Xxxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000, Attention:
Xxxxxx X. Xxxx, Esq.;
(b) if sent to the Company, shall be mailed, delivered, or faxed
and confirmed in writing to the Company and its counsel at the addresses set
forth in the Registration Statement, Attention: General Counsel;
(c) if sent to the Selling Stockholders, shall be mailed,
delivered, or faxed and confirmed in writing to the Custodian c/o Rutan &
Xxxxxx, LLP, 000 Xxxxx Xxxxxxxxx, 00xx Xxxxx, Xxxxx Xxxx, Xxxxxxxxxx 00000,
Attention: Xxxxxx X. Xxxx, Esq.;
provided, however, that any notice to an Underwriter pursuant to Section 8 shall
be delivered or sent by mail or facsimile transmission to such Underwriter at
its address set forth in its acceptance facsimile to Bear Xxxxxxx, which address
will be supplied to any other party hereto by Bear Xxxxxxx upon request. Any
such notices and other communications shall take effect at the time of receipt
thereof.
15. Parties. This Agreement shall inure solely to the benefit of, and
shall be binding upon, the Underwriters, the Company and the Selling
Stockholders and the controlling persons, directors, officers, employees and
agents referred to in Sections 8 and 9 hereof, and their respective successors
and assigns, and no other person shall have or be construed to have any legal or
equitable right, remedy or claim under or in respect of or by virtue of this
Agreement or any provision herein contained. This Agreement and all conditions
and provisions hereof are intended to be for the sole and exclusive benefit of
the parties hereto and said controlling persons and their respective successors,
officers, directors, heirs and legal representatives, and it is not for the
benefit of any other person, firm or corporation. The term "successors and
assigns" shall not include a purchaser, in its capacity as such, of Shares from
any of the Underwriters.
16. Governing Law and Jurisdiction; Waiver of Jury Trial. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK. The Company and each Selling Stockholder irrevocably (a) submits to
the jurisdiction of any court of the State of New York or the United State
District Court for the Southern District of the State of New York for the
purpose of any suit, action, or other proceeding arising out of this Agreement,
or any of the agreements or transactions contemplated by this Agreement, the
Registration Statement and the Prospectus (each, a "Proceeding"), (b) agrees
that all claims in respect of any Proceeding may be heard and determined in any
such court, (c) waives, to the fullest extent permitted by law, any immunity
from jurisdiction of any such court or from any legal process therein, (d)
agrees not to commence any Proceeding other than in such courts, and (e) waives,
to the fullest extent permitted by law, any claim that such Proceeding is
brought in an inconvenient forum. EACH OF THE COMPANY (ON BEHALF OF ITSELF AND,
TO THE FULLEST EXTENT PERMITTED BY LAW, ON BEHALF OF ITS RESPECTIVE EQUITY
HOLDERS AND CREDITORS) AND THE SELLING STOCKHOLDERS HEREBY WAIVES ANY RIGHT IT
MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED UPON, ARISING OUT OF
OR IN CONNECTION WITH THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT, THE REGISTRATION STATEMENT AND THE PROSPECTUS.
35
17. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same instrument. Delivery of
a signed counterpart of this Agreement by facsimile transmission shall
constitute valid and sufficient delivery thereof.
18. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
19. Time is of the Essence. Time shall be of the essence of this
Agreement. As used herein, the term "business day" shall mean any day when the
Commission's office in Washington, D.C. is open for business.
[signature page follows]
36
If the foregoing correctly sets forth your understanding, please so
indicate in the space provided below for that purpose, whereupon this letter
shall constitute a binding agreement among us.
Very truly yours,
OUTDOOR CHANNEL HOLDINGS, INC.
By:
-------------------------------------
Name:
Title:
SELLING STOCKHOLDERS
By:
-------------------------------------
Name:
Title: Attorney-in-Fact for the
Selling Stockholders
Accepted as of the date first above written
BEAR, XXXXXXX & CO. INC.
X.X. Xxxxxxx & Sons, Inc.
Xxxxxxxxx & Company, Inc.
By:
-------------------------------------
Name:
Title:
On behalf of themselves and the other
Underwriters named in Schedule I hereto.
