1
Exhibit 10.1
[EXECUTION COPY]
1,500,000 SHARES
IL FORNAIO (AMERICA) CORPORATION
COMMON STOCK
UNDERWRITING AGREEMENT
DATED SEPTEMBER 18, 1997
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TABLE OF CONTENTS
Section 1. Representations and Warranties................................................. 2
(A) Representations and Warranties of the Company.................................. 2
Compliance with Registration Requirements................................... 2
Offering Materials Furnished to Underwriters................................ 3
Distribution of Offering Material By the Company............................ 3
The Underwriting Agreement.................................................. 3
Authorization of the Common Shares.......................................... 4
No Applicable Registration or Other Similar Rights.......................... 4
No Material Adverse Change.................................................. 4
Independent Accountants..................................................... 4
Preparation of the Financial Statements..................................... 4
Incorporation and Good Standing of the Company.............................. 5
Capitalization and Other Capital Stock Matters.............................. 5
Stock Exchange Listing...................................................... 6
Non-Contravention of Existing Instruments; No Further Authorizations or
Approvals Required................................................... 6
No Material Actions or Proceedings.......................................... 7
Intellectual Property Rights................................................ 7
All Necessary Permits, etc.................................................. 7
Title to Properties......................................................... 7
Tax Law Compliance.......................................................... 8
Company Not an "Investment Company."........................................ 8
Insurance................................................................... 8
No Price Stabilization or Manipulation...................................... 8
Related Party Transactions.................................................. 8
(B) Representations and Warranties of the Selling Stockholders.................... 9
The Underwriting Agreement.................................................. 9
The Custody Agreement and Power of Attorney................................. 9
Title to Common Shares to be Sold; All Authorizations Obtained.............. 9
Delivery of the Common Shares to be Sold.................................... 10
Non-Contravention; No Further Authorizations or Approvals Required.......... 10
No Registration or Other Similar Rights..................................... 10
No Further Consents, etc.................................................... 10
Disclosure Made by Such Selling Stockholder in the Prospectus............... 11
No Price Stabilization or Manipulation...................................... 11
Section 2. Purchase, Sale and Delivery of the Common Shares............................... 11
The Firm Common Shares...................................................... 11
The First Closing Date...................................................... 12
The Optional Common Shares; the Second Closing Date......................... 12
Public Offering of the Common Shares........................................ 13
Payment for the Common Shares............................................... 13
Delivery of the Common Shares............................................... 13
Delivery of Prospectus to the Underwriters.................................. 14
Section 3. Additional Covenants........................................................... 14
(A) Covenants of the Company...................................................... 14
Representatives' Review of Proposed Amendments and Supplements.............. 14
Securities Act Compliance................................................... 14
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Amendments and Supplements to the Prospectus and Other Securities Act
Matters.............................................................. 15
Copies of any Amendments and Supplements to the Prospectus.................. 15
Blue Sky Compliance......................................................... 15
Use of Proceeds............................................................. 16
Transfer Agent.............................................................. 16
Earning Statement........................................................... 16
Periodic Reporting Obligations.............................................. 16
Agreement Not To Offer or Sell Additional Securities........................ 16
Future Reports to the Representatives....................................... 17
(B) Covenants of the Selling Stockholders......................................... 17
Agreement Not to Offer or Sell Additional Securities........................ 17
Delivery of Forms W-8 and W-9............................................... 18
Section 4. Payment of Expenses............................................................ 18
Section 5. Conditions of the Obligations of the Underwriters.............................. 19
Accountants' Comfort Letter................................................. 20
Compliance with Registration Requirements; No Stop Order; No
Objection from NASD.................................................. 20
No Material Adverse Change.................................................. 20
Opinion of Counsel for the Company.......................................... 21
Opinion of Counsel for the Underwriters..................................... 21
Officers' Certificate....................................................... 21
Bring-down Comfort Letter................................................... 21
Opinion of Counsel for the Selling Stockholders............................. 22
Selling Stockholders' Certificate........................................... 22
Selling Stockholders' Documents............................................. 22
Lock-Up Agreement from Stockholders of the Company.......................... 22
Additional Documents........................................................ 23
Section 6. Reimbursement of Underwriters' Expenses........................................ 23
Section 7. Indemnification................................................................ 23
Indemnification of the Underwriters......................................... 23
Indemnification by the Underwriters......................................... 26
Notifications and Other Indemnification Procedures.......................... 27
Settlements................................................................. 28
Section 8. Contribution................................................................... 28
Section 9. Default of One or More of the Several Underwriters............................. 30
Section 10. Termination of this Agreement................................................. 31
Section 11. Representations and Indemnities to Survive Delivery........................... 32
Section 12. Notices....................................................................... 32
Section 13. Successors.................................................................... 33
Section 14. Partial Unenforceability...................................................... 33
Section 15. Governing Law Provisions...................................................... 33
Governing Law............................................................... 33
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Consent to Jurisdiction..................................................... 33
Section 16. Failure of One or More of the Selling Stockholders to Sell and Deliver
Common Shares................................................................. 34
Section 17. General Provisions............................................................ 34
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UNDERWRITING AGREEMENT
September 18, 1997
XXXXXXXXXX SECURITIES
BT ALEX. XXXXX INCORPORATED
As Representatives of the several Underwriters
c/x XXXXXXXXXX SECURITIES
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Ladies and Gentlemen:
INTRODUCTORY. Il Fornaio (America) Corporation, a California
corporation to be reincorporated as a Delaware corporation prior to the First
Closing Date (the "Reincorporation") (references herein to the "Company" shall
mean the California corporation prior to the Reincorporation and the Delaware
corporation immediately after the Reincorporation), proposes to issue and sell
to the several underwriters named in Schedule A (the "Underwriters") an
aggregate of 1,000,000 shares of its Common Stock, no par value (the "Common
Stock"); and the stockholders of the Company named in Schedule B (collectively,
the "Selling Stockholders") severally propose to sell to the Underwriters an
aggregate of 500,000 shares of Common Stock. The 1,000,000 shares of Common
Stock to be sold by the Company and the 500,000 shares of Common Stock to be
sold by the Selling Stockholders are collectively called the "Firm Common
Shares." In addition, the Company has granted to the Underwriters an option to
purchase up to an additional 225,000 shares (the "Optional Common Shares") of
Common Stock, as provided in Section hereof. The Firm Common Shares and, if and
to the extent such option is exercised, the Optional Common Shares are
collectively called the "Common Shares." Xxxxxxxxxx Securities and BT Alex.
Xxxxx Incorporated have agreed to act as representatives of the several
Underwriters (in such capacity, the "Representatives") in connection with the
offering and sale of the Common Shares.
The Company has prepared and filed with the Securities and
Exchange Commission (the "Commission") a registration statement on Form S-1
(File No. 333-23605), which contains a form of prospectus to be used in
connection with the public offering and sale of the Common Shares. Such
registration statement, as amended, including the financial statements, exhibits
and schedules thereto, in the form in which it was declared effective by the
Commission under the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder (collectively, the "Securities Act"),
including any information deemed to be a part thereof at the time of
effectiveness pursuant
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to Rule 430A or Rule 434 under the Securities Act, is called the "Registration
Statement." Any registration statement filed by the Company pursuant to Rule
462(b) under the Securities Act is called the "Rule 462(b) Registration
Statement," and from and after the date and time of filing of the Rule 462(b)
Registration Statement the term "Registration Statement" shall include the Rule
462(b) Registration Statement. Such prospectus, in the form first used by the
Underwriters to confirm sales of the Common Shares, is called the "Prospectus";
provided, however, if the Company has, with the consent of Xxxxxxxxxx
Securities, elected to rely upon Rule 434 under the Securities Act, the term
"Prospectus" shall mean the Company's prospectus subject to completion (each, a
"preliminary prospectus") dated August 22, 1997 (such preliminary prospectus is
called the "Rule 434 preliminary prospectus"), together with the applicable term
sheet (the "Term Sheet") prepared and filed by the Company with the Commission
under Rules 434 and 424(b) under the Securities Act and all references in this
Agreement to the date of the Prospectus shall mean the date of the Term Sheet.
All references in this Agreement to the Registration Statement, the Rule 462(b)
Registration Statement, a preliminary prospectus, the Prospectus or the Term
Sheet, or any amendments or supplements to any of the foregoing, shall include
any copy thereof filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval System ("XXXXX").
The Company and each of the Selling Stockholders hereby confirm
their respective agreements with the Underwriters as follows:
SECTION 1. REPRESENTATIONS AND WARRANTIES.
A) REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents, warrants and covenants to each Underwriter as follows:
i) Compliance with Registration Requirements. The Registration
Statement and any Rule 462(b) Registration Statement have been declared
effective by the Commission under the Securities Act. The Company
warrants that it has complied to the Commission's satisfaction with all
requests of the Commission for additional or supplemental information.
The Company warrants that no stop order suspending the effectiveness of
the Registration Statement or any Rule 462(b) Registration Statement is
in effect and no proceedings for such purpose have been instituted or
are pending or, to the best knowledge of the Company, are contemplated
or threatened by the Commission.
Each preliminary prospectus and the Prospectus when filed
complied in all material respects with the Securities Act and, if filed
by electronic transmission pursuant to XXXXX (except as may be permitted
by Regulation S-T under the
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Securities Act), was identical to the copy thereof delivered to the
Underwriters for use in connection with the offer and sale of the Common
Shares. Each of the Registration Statement, any Rule 462(b) Registration
Statement and any post-effective amendment thereto, at the time it
became effective complied, and through the Prospectus Delivery Period
(as defined in Section hereof) will comply, in all material respects
with the Securities Act and did not and will not contain any untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading. The Prospectus, as amended or supplemented, as of its date
did not, and through the Prospectus Delivery Period will not, contain
any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The
representations and warranties set forth in the two immediately
preceding sentences do not apply to statements in or omissions from the
Registration Statement, any Rule 462(b) Registration Statement, or any
post-effective amendment thereto, or the Prospectus, or any amendments
or supplements thereto, made in reliance upon and in conformity with
information relating to any Underwriter furnished to the Company in
writing by the Representatives expressly for use therein. There are no
contracts or other documents required by the Securities Act to be
described in the Prospectus or to be filed as exhibits to the
Registration Statement which have not been described or filed as
required.
ii) Offering Materials Furnished to Underwriters. The Company
has delivered to the Representatives two complete manually signed copies
of the Registration Statement and of each consent and certificate of
experts filed as a part thereof, and conformed copies of the
Registration Statement (without exhibits) and preliminary prospectuses
and the Prospectus, as amended or supplemented, in such quantities and
at such places as the Representatives have reasonably requested for each
of the Underwriters.
iii) Distribution of Offering Material By the Company. The
Company has not distributed and will not distribute, prior to the later
of the Second Closing Date (as defined below) and the completion of the
Underwriters' distribution of the Common Shares, any offering material
in connection with the offering and sale of the Common Shares other than
a preliminary prospectus, the Prospectus or the Registration Statement.
iv) The Underwriting Agreement. This Agreement has been duly
authorized, executed and delivered by, and is a valid and binding
agreement of, the Company, enforceable in accordance with its terms,
except as rights to indemnification hereunder may be limited by
applicable law and except as the enforcement hereof may be limited by
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bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by
general equitable principles.
v) Authorization of the Common Shares. The Common Shares to be
purchased by the Underwriters from the Company have been duly authorized
for issuance and sale pursuant to this Agreement and, when issued and
delivered by the Company and paid for by the Underwriters pursuant to
this Agreement, will be validly issued, fully paid and nonassessable.
vi) No Applicable Registration or Other Similar Rights. There
are no persons with registration or other similar rights to have any
equity or debt securities registered for sale under the Registration
Statement or included in the offering contemplated by this Agreement,
except for such rights as have been duly waived.
vii) No Material Adverse Change. Except as otherwise disclosed
in the Prospectus, subsequent to the respective dates as of which
information is given in the Prospectus: (i) there has been no material
adverse change, or any development that could reasonably be expected to
result in a material adverse change, in the condition, financial or
otherwise, or in the earnings, business, operations or prospects,
whether or not arising from transactions in the ordinary course of
business, of the Company (any such change is called a "Material Adverse
Change") (other than, for purposes of this representation and warranty
only, adverse changes resulting solely from general economic conditions
or conditions affecting generally the industry in which the Company
operates); (ii) the Company has not incurred any material liability or
obligation, indirect, direct or contingent, not in the ordinary course
of business nor entered into any material transaction or agreement not
in the ordinary course of business; and (iii) there has been no dividend
or distribution of any kind declared, paid or made by the Company on any
class of capital stock or repurchase or redemption by the Company of any
class of capital stock.
viii) Independent Accountants. Deloitte & Touche LLP, who have
expressed their opinion with respect to the financial statements (which
term as used in this Agreement includes the related notes thereto) and
supporting schedules filed with the Commission as a part of the
Registration Statement and included in the Prospectus, are independent
public or certified public accountants as required by the Securities
Act.
ix) Preparation of the Financial Statements. The financial
statements filed with the Commission as a part of the Registration
Statement and included in the Prospectus present fairly the financial
position of the Company as of and at the dates indicated and the results
of its operations and cash flows for the periods specified. The
supporting
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schedules included in the Registration Statement present fairly the
information required to be stated therein. Such financial statements and
supporting schedules have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis throughout
the periods involved, except as may be expressly stated in the related
notes thereto. No other financial statements or supporting schedules are
required to be included in the Registration Statement. The financial
data set forth in the Prospectus under the captions "Prospectus
Summary--Summary Financial and Operating Data," "Selected Financial and
Operating Data" and "Capitalization" fairly present the information set
forth therein on a basis consistent with that of the audited financial
statements contained in the Registration Statement.
x) Incorporation and Good Standing of the Company. The Company
has been duly incorporated and is validly existing as a corporation in
good standing under the laws of the jurisdiction of its incorporation
and has corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus
and, in the case of the Company, to enter into and perform its
obligations under this Agreement. The Company is duly qualified as a
foreign corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required (including
California (after the Reincorporation), Colorado, Nevada, Oregon and
Washington) whether by reason of the ownership or leasing of property or
the conduct of business, except for such jurisdictions (other than
California, Colorado, Nevada, Oregon and Washington) where the failure
to so qualify or to be in good standing would not, individually or in
the aggregate, result in a Material Adverse Change. The Company has no
subsidiaries. The Company will be reincorporated in Delaware prior to
the First Closing Date.
xi) Capitalization and Other Capital Stock Matters. The
authorized, issued and outstanding capital stock of the Company is as
set forth in the Prospectus under the caption "Capitalization" (other
than for subsequent issuances, if any, pursuant to employee benefit
plans described in the Prospectus or upon exercise of outstanding
warrants described in the Prospectus), except as described in the
opinion dated January 27, 1993, issued by Xxxxxx Godward LLP in
connection with the sale of 730,664 shares of the Company's Series F
Preferred Stock (the "Exceptions"). The Common Stock (including the
Common Shares) conforms in all material respects to the description
thereof contained in the Prospectus. Except for the Exceptions, all of
the issued and outstanding shares of Common Stock (including the shares
of Common Stock owned by Selling Stockholders) have been duly authorized
and validly issued, are fully paid and nonassessable and have been
issued in compliance with federal and state securities laws. None of the
outstanding shares of
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Common Stock were issued in violation of any preemptive rights, rights
of first refusal or other similar rights to subscribe for or purchase
securities of the Company, except as described in the Exceptions. There
are no authorized or outstanding options, warrants, preemptive rights,
rights of first refusal or other rights to purchase, or equity or debt
securities convertible into or exchangeable or exercisable for, any
capital stock of the Company other than those accurately described in
the Prospectus. The description of the Company's stock option, stock
bonus and other stock plans or arrangements, and the options or other
rights granted thereunder, set forth in the Prospectus accurately and
fairly presents in all material respects the information required by the
Securities Act to be shown with respect to such plans, arrangements,
options and rights.
xii) Stock Exchange Listing. The Common Shares have been
approved for inclusion on the Nasdaq National Market, subject only to
official notice of issuance.
xiii) Non-Contravention of Existing Instruments; No Further
Authorizations or Approvals Required. The Company is not in violation of
its charter or by-laws or in default (or, with the giving of notice or
lapse of time, would be in default) ("Default") under any indenture,
mortgage, loan or credit agreement, note, contract, franchise, lease or
other instrument to which the Company is a party or by which it may be
bound, or to which any of the property or assets of the Company is
subject (each, an "Existing Instrument"), except for such Defaults as
would not, individually or in the aggregate, result in a Material
Adverse Change. The Company's execution, delivery and performance of
this Agreement and consummation of the transactions contemplated hereby
and by the Prospectus (i) have been duly authorized by all necessary
corporate action and will not result in any violation of the provisions
of the charter or by-laws of the Company, (ii) will not conflict with or
constitute a breach of, or Default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company pursuant to, or require the consent of any other
party to, any Existing Instrument, except for such conflicts, breaches,
Defaults, liens, charges or encumbrances as would not, individually or
in the aggregate, result in a Material Adverse Change and (iii) will not
result in any violation of any law, administrative regulation or
administrative or court decree applicable to the Company. No consent,
approval, authorization or other order of, or registration or filing
with, any court or other governmental or regulatory authority or agency,
is required for the Company's execution, delivery and performance of
this Agreement and consummation of the transactions contemplated hereby
and by the Prospectus, except such as have been obtained or made by the
Company and are in full force and effect under the Securities Act, and
except applicable state
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securities or blue sky laws and from the National Association of
Securities Dealers, Inc. (the "NASD").
xiv) No Material Actions or Proceedings. There are no legal or
governmental actions, suits or proceedings pending or, to the best of
the Company's knowledge, threatened (i) against or, to the Company's
knowledge, affecting the Company, (ii) which has as the subject thereof
any officer or director (with respect to actions or inactions in his
capacity as officer or director) of, or property owned or leased by, the
Company or (iii) relating to environmental or discrimination matters,
where in any such case (A) there is a reasonable possibility that such
action, suit or proceeding might be determined adversely to the Company
and (B) any such action, suit or proceeding, if so determined adversely,
would reasonably be expected to result in a Material Adverse Change or
adversely affect the consummation of the transactions contemplated by
this Agreement. No labor dispute with the employees of the Company
exists or, to the best of the Company's knowledge, is threatened or
imminent which would reasonably be expected to result in a Material
Adverse Change.
xv) Intellectual Property Rights. The Company owns or possesses
sufficient trademarks, trade names, patent rights, copyrights, licenses,
approvals, trade secrets and other similar rights (collectively,
"Intellectual Property Rights") reasonably necessary to conduct its
business as now conducted; and the expected expiration of any of such
Intellectual Property Rights would not result in a Material Adverse
Change. The Company has not received any notice of infringement or
conflict with asserted Intellectual Property Rights of others, which
infringement or conflict, if the subject of an unfavorable decision,
would result in a Material Adverse Change.
xvi) All Necessary Permits, etc. The Company possesses such
valid and current certificates, authorizations or permits issued by the
appropriate state, federal or foreign regulatory agencies or bodies
necessary to conduct its business, and the Company has not received any
notice of proceedings relating to the revocation or modification of, or
non-compliance with, any such certificate, authorization or permit
which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would reasonably be expected to result in a
Material Adverse Change.
xvii) Title to Properties. The Company has good and marketable
title to all the properties and assets reflected as owned in the
financial statements referred to in Section above (or elsewhere in the
Prospectus), in each case free and clear of any security interests,
mortgages, liens, encumbrances, equities, claims and other defects,
except such as do not materially and adversely affect the value of such
property and do not materially interfere with the use made or
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proposed to be made of such property by the Company. The real property,
improvements, equipment and personal property held under lease by the
Company are held under valid and enforceable leases, with such
exceptions as are not material and do not materially interfere with the
use made or proposed to be made of such real property, improvements,
equipment or personal property by the Company.
xviii) Tax Law Compliance. The Company has filed all necessary
federal, state and foreign income and franchise tax returns and has paid
all taxes shown as due thereon and any taxes required to have been paid
by it in any subsequent period and, if due and payable, any related or
similar assessment, fine or penalty levied against it. To the best of
the Company's knowledge, the Company has made adequate charges, accruals
and reserves in the applicable financial statements referred to in
Section above in respect of all federal, state and foreign income and
franchise taxes for all periods as to which the tax liability of the
Company has not been finally determined.
xix) Company Not an "Investment Company." The Company has been
advised of the rules and requirements under the Investment Company Act
of 1940, as amended (the "Investment Company Act"). The Company is not,
and after receipt of payment for the Common Shares will not be, an
"investment company" within the meaning of Investment Company Act and
will use its commercially reasonable efforts to conduct its business in
a manner so that it will not become subject to the Investment Company
Act.
xx) Insurance. The Company is insured by recognized institutions
with policies in such amounts and with such deductibles and covering
such risks as are generally deemed adequate and customary for its
business, except as disclosed in the Prospectus. The Company has no
reason to believe that it will not be able (i) to renew its existing
insurance coverage as and when such policies expire or (ii) to obtain
comparable coverage from similar institutions as may be necessary or
appropriate to conduct its business as now conducted and at a cost that
would not result in a Material Adverse Change. The Company has not been
denied any insurance coverage which it has sought or for which it has
applied.
xxi) No Price Stabilization or Manipulation. The Company has not
taken and will not take, directly or indirectly, any action designed to
or that might 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 Common Shares.
xxii) Related Party Transactions. There are no business
relationships or related-party transactions involving the Company or any
other person required to be
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described in the Prospectus which have not been described as required.
Any certificate signed by an officer of the Company and delivered
to the Representatives or to counsel for the Underwriters expressly for use in
connection with the Closing shall be deemed to be a representation and warranty
by the Company to each Underwriter as to the matters set forth therein.
B) REPRESENTATIONS AND WARRANTIES OF THE SELLING STOCKHOLDERS. Each
Selling Stockholder represents, warrants and covenants to each Underwriter as
follows:
i) The Underwriting Agreement. This Agreement has been duly
authorized, executed and delivered by or on behalf of such Selling
Stockholder and is a valid and binding agreement of such Selling
Stockholder, enforceable in accordance with its terms, except as rights
to indemnification hereunder may be limited by applicable law and except
as the enforcement hereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or
affecting the rights and remedies of creditors or by general equitable
principles.
ii) The Custody Agreement and Power of Attorney. Each of the (i)
Custody Agreement signed by such Selling Stockholder and BankBoston,
N.A., as custodian (the "Custodian"), relating to the deposit of the
Common Shares to be sold by such Selling Stockholder (the "Custody
Agreement") and (ii) Power of Attorney appointing certain individuals
named therein as such Selling Stockholder's attorneys-in-fact (each, an
"Attorney-in-Fact") to the extent set forth therein relating to the
transactions contemplated hereby and by the Prospectus (the "Power of
Attorney"), of such Selling Stockholder has been duly authorized,
executed and delivered by or on behalf of such Selling Stockholder and
is a valid and binding agreement of such Selling Stockholder,
enforceable in accordance with its terms, except as rights to
indemnification thereunder may be limited by applicable law and except
as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or
affecting the rights and remedies of creditors or by general equitable
principles.
iii) Title to Common Shares to be Sold; All Authorizations
Obtained. Such Selling Stockholder has, and on the First Closing Date
will have, good and valid title to all of the Common Shares which may be
sold by such Selling Stockholder pursuant to this Agreement on such date
and the legal right and power, and all authorizations and approvals
required by law and under its charter or by-laws, partnership agreement,
trust agreement or other organizational documents to enter into this
Agreement and its Custody Agreement and Power of Attorney, to sell,
transfer and deliver all of the
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Common Shares which may be sold by such Selling Stockholder pursuant to
this Agreement and to comply with its other obligations hereunder and
thereunder.
iv) Delivery of the Common Shares to be Sold. Delivery of and
payment for the Common Shares which are sold by such Selling Stockholder
pursuant to this Agreement will pass good and valid title to such Common
Shares, free and clear of any security interest, mortgage, pledge, lien,
encumbrance or other claim.
v) Non-Contravention; No Further Authorizations or Approvals
Required. The execution and delivery by or on behalf of such Selling
Stockholder of, and the performance by such Selling Stockholder of its
obligations under, this Agreement, the Custody Agreement and the Power
of Attorney will not contravene or conflict with, result in a breach of,
or constitute a Default under, or require the consent of any other party
to, the charter or by-laws, partnership agreement, trust agreement or
other organizational documents of such Selling Stockholder or any other
agreement or instrument to which such Selling Stockholder is a party or
by which it is bound or under which it is entitled to any right or
benefit, any provision of applicable law or any judgment, order, decree
or regulation applicable to such Selling Stockholder of any court,
regulatory body, administrative agency, governmental body or arbitrator
having jurisdiction over such Selling Stockholder, except where any of
the foregoing shall not have an adverse effect on the Selling
Stockholder's ability to validly transfer to the Underwriters title to
the Common Shares free and clear of any security interest, mortgage,
pledge, lien, encumbrance or other claim, or to otherwise perform its
obligations hereunder. No consent, approval, authorization or other
order of, or registration or filing with, any court or other
governmental authority or agency, is required for the consummation by
such Selling Stockholder of the transactions contemplated in this
Agreement, except such as have been obtained or made and are in full
force and effect under the Securities Act, and except applicable state
securities or blue sky laws and from the NASD.
vi) No Registration or Other Similar Rights. 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
contemplated by this Agreement.
vii) No Further Consents, etc. No consent, approval or waiver is
required under any instrument or agreement to which such Selling
Stockholder is a party or by which it is bound or under which it is
entitled to any right or benefit, in connection with the offering, sale
or purchase by the Underwriters of any of the Common Shares which may be
sold by
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such Selling Stockholder under this Agreement or the consummation by
such Selling Stockholder of any of the other transactions contemplated
hereby, except where any of the foregoing shall not have an adverse
effect on the Selling Stockholder's ability to validly transfer to the
Underwriters title to the Common Shares free and clear of any security
interest, mortgage, pledge, lien, encumbrance or other claim, or to
otherwise perform its obligations hereunder.
viii) Disclosure Made by Such Selling Stockholder in the
Prospectus. All information furnished by or on behalf of such Selling
Stockholder in writing expressly for use in the Registration Statement
and Prospectus is, and on the First Closing Date and the Second Closing
Date will be, true, correct, and complete in all material respects, and
does not, and on the First Closing Date and the Second Closing Date will
not, contain any untrue statement of a material fact or omit to state
any material fact necessary to make such information not misleading.
Such Selling Stockholder confirms as accurate the number of shares of
Common Stock set forth opposite such Selling Stockholder's name in the
Prospectus under the caption "Principal and Selling Stockholders" (both
prior to and after giving effect to the sale of the Common Shares).
ix) No Price Stabilization or Manipulation. Such Selling
Stockholder has not taken and will not take, directly or indirectly, any
action designed to or that might 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 Common Shares.
Any certificate signed by or on behalf of any Selling Stockholder
and delivered to the Representatives or to counsel for the Underwriters
expressly for use in connection with the Closing shall be deemed to be a
representation and warranty by such Selling Stockholder to each Underwriter as
to the matters covered thereby.
SECTION 2. PURCHASE, SALE AND DELIVERY OF THE COMMON SHARES.
A) The Firm Common Shares. Upon the terms herein set forth, (i)
the Company agrees to issue and sell to the several Underwriters an aggregate of
1,000,000 Firm Common Shares and (ii) each Selling Stockholder agrees to sell to
the several Underwriters, severally and not jointly, that number of Firm Common
Shares set forth opposite such Selling Stockholder's name on Schedule B. On the
basis of the representations, warranties and agreements herein contained, and
upon the terms but subject to the conditions herein set forth, the Underwriters
agree, severally and not jointly, to purchase from the Company and the Selling
Stockholders the respective number of Firm Common Shares set forth
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opposite their names on Schedule A. The purchase price per Firm Common Share to
be paid by the several Underwriters to the Company and the Selling Stockholders
shall be $11.00 per share.
B) The First Closing Date. Delivery of certificates for the Firm
Common Shares to be purchased by the Underwriters and payment therefor shall be
made at the offices of Xxxxxxxxxx Securities, 000 Xxxxxxxxxx Xxxxxx, Xxx
Xxxxxxxxx, Xxxxxxxxxx (or such other place as may be agreed to by the Company
and the Representatives) at 6:00 a.m. San Francisco time, on Wednesday,
September 24, 1997, or such other time and date not later than 10:30 a.m. San
Francisco time, on Wednesday, October 8, 1997 as the Representatives shall
designate by notice to the Company (the time and date of such closing are called
the "First Closing Date"). The Company and the Selling Stockholders hereby
acknowledge that circumstances under which the Representatives may provide
notice to postpone the First Closing Date as originally scheduled include, but
are in no way limited to, any determination by the Company or the
Representatives to recirculate to the public copies of an amended or
supplemented Prospectus or a delay as contemplated by the provisions of Section
hereof.
C) The Optional Common Shares; the Second Closing Date. In
addition, on the basis of the representations, warranties and agreements herein
contained, and upon the terms but subject to the conditions herein set forth,
the Company hereby grants an option to the several Underwriters to purchase,
severally and not jointly, up to an aggregate of 225,000 Optional Common Shares
from the Company at the purchase price per share to be paid by the Underwriters
for the Firm Common Shares. The option granted hereunder is for use by the
Underwriters solely in covering any over-allotments in connection with the sale
and distribution of the Firm Common Shares. The option granted hereunder may be
exercised at any time (but not more than once) upon notice by the
Representatives to the Company, which notice may be given at any time within 30
days from the date of this Agreement. Such notice shall set forth (i) the
aggregate number of Optional Common Shares as to which the Underwriters are
exercising the option, (ii) the names and denominations in which the
certificates for the Optional Common Shares are to be registered and (iii) the
time, date and place at which such certificates will be delivered (which time
and date may be simultaneous with, but not earlier than, the First Closing Date;
and in such case the term "First Closing Date" shall refer to the time and date
of delivery of certificates for the Firm Common Shares and the Optional Common
Shares). Such time and date of delivery, if subsequent to the First Closing
Date, is called the "Second Closing Date" and shall be determined by the
Representatives and shall not be earlier than three nor later than five full
business days after delivery of such notice of exercise. If any Optional Common
Shares are to be purchased, (a) each Underwriter agrees, severally and not
jointly, to purchase the number of Optional Common Shares (subject to such
adjustments to eliminate fractional shares as the Representatives may determine)
that bears the same proportion to the total number of Optional Common Shares to
be purchased as the number of Firm Common Shares set forth on Schedule A
opposite the name of such Underwriter bears to the total number of Firm Common
Shares and (b) the Company agrees to sell the number of Optional Common Shares
to be purchased by the Underwriters. The Representatives may cancel the option
at any
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time prior to its expiration by giving written notice of such cancellation
to the Company.
D) Public Offering of the Common Shares. The Representatives
hereby advise the Company and the Selling Stockholders that the Underwriters
intend to offer for sale to the public, as described in the Prospectus, their
respective portions of the Common Shares as soon after this Agreement has been
executed and the Registration Statement has been declared effective as the
Representatives, in their sole judgment, have determined is advisable and
practicable.
E) Payment for the Common Shares. Payment for the Common Shares
to be sold by the Company shall be made at the First Closing Date (and, if
applicable, at the Second Closing Date) by wire transfer of immediately
available funds to the order of the Company. Payment for the Common Shares to be
sold by the Selling Stockholders shall be made at the First Closing Date by wire
transfer of immediately available funds to the order of the Custodian.
It is understood that the Representatives have been authorized,
for their own accounts and the accounts of the several Underwriters, to accept
delivery of and receipt for, and make payment of the purchase price for, the
Firm Common Shares and any Optional Common Shares the Underwriters have agreed
to purchase. Xxxxxxxxxx Securities, individually and not as a Representative of
the Underwriters, may (but shall not be obligated to) make payment for any
Common Shares to be purchased by any Underwriter whose funds shall not have been
received by the Representatives by the First Closing Date or the Second Closing
Date, as the case may be, for the account of such Underwriter, but any such
payment shall not relieve such Underwriter from any of its obligations under
this Agreement.
Each Selling Stockholder hereby agrees that (i) it will pay all
stock transfer taxes, stamp duties and other similar taxes, if any, payable in
connection with the sale or delivery of the Common Shares to be sold by such
Selling Stockholder to the several Underwriters, or otherwise in connection with
the performance of such Selling Stockholder's obligations hereunder and (ii) the
Custodian is authorized to deduct for such payment any such amounts from the
proceeds to such Selling Stockholder hereunder and to hold such amounts for the
account of such Selling Stockholder with the Custodian under the Custody
Agreement.
F) Delivery of the Common Shares. The Company and the Selling
Stockholders shall deliver, or cause to be delivered, to the Representatives for
the accounts of the several Underwriters certificates for the Firm Common Shares
to be sold by them at the First Closing Date, against the irrevocable release of
a wire transfer of immediately available funds for the amount of the purchase
price therefor. The Company shall also deliver, or cause to be delivered, to the
Representatives for the accounts of the several Underwriters, certificates for
the Optional Common Shares
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the Underwriters have agreed to purchase at the First Closing Date or the Second
Closing Date, as the case may be, against the irrevocable release of a wire
transfer of immediately available funds for the amount of the purchase price
therefor. The certificates for the Common Shares shall be in definitive form and
registered in such names and denominations as the Representatives shall have
requested at least two full business days prior to the First Closing Date (or
the Second Closing Date, as the case may be) and shall be made available for
inspection on the business day preceding the First Closing Date (or the Second
Closing Date, as the case may be) at a location in New York, New York as the
Representatives may designate. Time shall be of the essence, and delivery at the
time and place specified in this Agreement is a further condition to the
obligations of the Underwriters.
G) Delivery of Prospectus to the Underwriters. Not later than
12:00 p.m. on the second business day following the date the Common Shares are
released by the Underwriters for sale to the public, the Company shall deliver
or cause to be delivered copies of the Prospectus in such quantities and at such
places as the Representatives shall request.
SECTION 3. ADDITIONAL COVENANTS.
A) COVENANTS OF THE COMPANY. The Company further covenants and agrees
with each Underwriter as follows:
i) Representatives' Review of Proposed Amendments and
Supplements. During such period beginning on the date hereof and ending
on the later of (1) the First Closing Date, (2) the date 25 days after
the offering date, as such term is defined in Rule 174(d) under the
Securities Act, or (3) such date, as in the opinion of counsel for the
Underwriters, the Prospectus is no longer required by law to be
delivered in connection with sales by an Underwriter or dealer (the
"Prospectus Delivery Period"), prior to amending or supplementing the
Registration Statement (including any registration statement filed under
Rule 462(b) under the Securities Act) or the Prospectus, the Company
shall furnish to the Representatives for review a copy of each such
proposed amendment or supplement, and the Company shall not file any
such proposed amendment or supplement to which the Representatives
reasonably object.
ii) Securities Act Compliance. After the date of this Agreement,
the Company shall promptly advise the Representatives in writing (i) of
the receipt of any comments of, or requests for additional or
supplemental information from, the Commission, (ii) of the time and date
of any filing of any post-effective amendment to the Registration
Statement or any amendment or supplement to any preliminary prospectus
or the Prospectus, (iii) of the time and date that any post-effective
amendment to the Registration Statement becomes
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effective and (iv) 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 any order preventing or
suspending the use of any preliminary prospectus or the Prospectus, or
of any proceedings to remove, suspend or terminate from listing or
quotation the Common Stock from any securities exchange upon which it is
listed for trading or included or designated for quotation, or of the
threatening or initiation of any proceedings for any of such purposes.
If the Commission shall enter any such stop order at any time, the
Company will use its best efforts to obtain the lifting of such order at
the earliest possible moment. Additionally, the Company agrees that it
shall comply with the provisions of Rules 424(b), 430A and 434, as
applicable, under the Securities Act and will use its reasonable efforts
to confirm that any filings made by the Company under such Rule 424(b)
were received in a timely manner by the Commission.
iii) Amendments and Supplements to the Prospectus and Other
Securities Act Matters. If, during the Prospectus Delivery Period, any
event shall occur or condition exist as a result of which it is
necessary to amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances when the
Prospectus is delivered to a purchaser, not misleading, or if in the
opinion of the Representatives or counsel for the Underwriters it is
otherwise necessary to amend or supplement the Prospectus to comply with
law, the Company agrees to promptly prepare (subject to Section hereof),
file with the Commission and furnish at its own expense to the
Underwriters and to dealers, amendments or supplements to the Prospectus
so that the statements in the Prospectus as so amended or supplemented
will not, in the light of the circumstances when the Prospectus is
delivered to a purchaser, be misleading or so that the Prospectus, as
amended or supplemented, will comply with law.
iv) Copies of any Amendments and Supplements to the Prospectus.
The Company agrees to furnish the Representatives, without charge,
during the Prospectus Delivery Period, as many copies of the Prospectus
and any amendments and supplements thereto as the Representatives may
reasonably request.
v) Blue Sky Compliance. The Company shall cooperate with the
Representatives and counsel for the Underwriters to qualify or register
the Common Shares for sale under (or obtain exemptions from the
application of) the state securities or blue sky laws or Canadian
provincial securities laws of those jurisdictions designated by the
Representatives, shall comply with such laws and shall continue such
qualifications, registrations and exemptions in effect so long as
required for the distribution of the Common Shares. The Company shall
not be required to qualify as a
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foreign corporation or to take any action that would subject it to
general service of process in any such jurisdiction where it is not
presently qualified or where it would be subject to taxation as a
foreign corporation. The Company will advise the Representatives
promptly of the suspension of the qualification or registration of (or
any such exemption relating to) the Common Shares for offering, sale or
trading in any jurisdiction or any initiation or threat of any
proceeding for any such purpose, and in the event of the issuance of any
order suspending such qualification, registration or exemption, the
Company shall use its best efforts to obtain the withdrawal thereof at
the earliest possible moment.
vi) Use of Proceeds. The Company shall apply the net proceeds
from the sale of the Common Shares sold by it in the manner described
under the caption "Use of Proceeds" in the Prospectus.
vii) Transfer Agent. The Company shall engage and maintain, at
its expense, a registrar and transfer agent for the Common Stock.
viii) Earning Statement. As soon as practicable, the Company
will make generally available to its security holders and to the
Representatives an earning statement (which need not be audited)
covering the twelve-month period ending September 30, 1998 that
satisfies the provisions of Section 11(a) of the Securities Act.
ix) Periodic Reporting Obligations. During the Prospectus
Delivery Period the Company shall file, on a timely basis, with the
Commission and the Nasdaq National Market all reports and documents
required to be filed under the Securities and Exchange Act of 1934, as
amended (the "Exchange Act"). Additionally, the Company shall file with
the Commission all reports on Form SR as may be required under Rule 463
under the Securities Act.
x) Agreement Not To Offer or Sell Additional Securities. During
the period of 180 days following the date of the Prospectus, the Company
will not, without the prior written consent of Xxxxxxxxxx Securities
(which consent may be withheld at the sole discretion of Xxxxxxxxxx
Securities), directly or indirectly, sell, offer, contract or grant any
option to sell, pledge, transfer or establish an open "put equivalent
position" within the meaning of Rule 16a-1(h) under the Exchange Act, or
otherwise dispose of or transfer, or announce the offering of, or file
any registration statement under the Securities Act in respect of, any
shares of Common Stock, options or warrants to acquire shares of the
Common Stock or securities exchangeable or exercisable for or
convertible into shares of Common Stock (other than as contemplated by
this Agreement with respect to the Common Shares); provided, however,
that the Company may file a
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registration statement on Form S-8 with respect to, and may issue shares
of its Common Stock or options to purchase its Common Stock, or Common
Stock upon exercise of options or warrants, pursuant to any stock
option, stock bonus or other stock plan or arrangement described in the
Prospectus, but only if the holders of such shares, options, warrants or
shares issued upon exercise of such options or warrants, agree in
writing not to, directly or indirectly, sell, offer, contract or grant
any option to sell (including without limitation any short sale),
pledge, transfer, establish an open "put equivalent position" within the
meaning of Rule 16a-1(h) under the Exchange Act, or otherwise dispose of
(including by devise or descent unless such devisees or descendants take
subject to such agreement) any such shares or options during such 180
day period without the prior written consent of Xxxxxxxxxx Securities
(which consent may be withheld at the sole discretion of the Xxxxxxxxxx
Securities) (a "Lock-Up Agreement"); provided, further that,
notwithstanding the foregoing proviso, the Company may issue shares of
its Common Stock upon exercise of outstanding options or warrants
disclosed in the Prospectus without having first obtained a Lock-Up
Agreement from such option or warrant holder, so long as the Company
shall have used its commercially reasonable efforts to obtain such
Lock-Up Agreement from such holder prior to such exercise.
xi) Future Reports to the Representatives. During the period of
five years hereafter the Company will furnish to the Representatives at
000 Xxxxxxxxxx Xxxxxx, Xxx Xxxxxxxxx, XX 00000 Attention: Xxxxxxx X.
Xxxxxxx: (i) as soon as practicable after the end of each fiscal year,
copies of the Annual Report of the Company containing the balance sheet
of the Company as of the close of such fiscal year and statements of
income, stockholders' equity and cash flows for the year then ended and
the opinion thereon of the Company's independent public or certified
public accountants; (ii) as soon as practicable after the filing
thereof, copies of each proxy statement, Annual Report on Form 10-K,
Quarterly Report on Form 10-Q, Current Report on Form 8-K or other
report filed by the Company with the Commission, the NASD or any
securities exchange; and (iii) as soon as available, copies of any
report or communication of the Company mailed generally to holders of
its Common Stock.
B) COVENANTS OF THE SELLING STOCKHOLDERS. Each Selling Stockholder
further covenants and agrees with each Underwriter:
i) Agreement Not to Offer or Sell Additional Securities. Such
Selling Stockholder will not, without the prior written consent of
Xxxxxxxxxx Securities (which consent may be withheld at the sole
discretion of Xxxxxxxxxx Securities), directly or indirectly, sell,
offer, contract or grant any option to sell (including without
limitation any short sale), pledge, transfer, establish an open "put
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equivalent position" within the meaning of Rule 16a-1(h) under the
Exchange Act, or otherwise dispose of (including by devise or descent
unless such devisees or descendants take subject to such agreement) any
shares of Common Stock, options or warrants to acquire shares of Common
Stock, or securities exchangeable or exercisable for or convertible into
shares of Common Stock currently or hereafter owned either of record or
beneficially (as defined in Rule 13d-3 under the Exchange Act) by the
undersigned, or publicly announce the undersigned's intention to do any
of the foregoing, for a period commencing on the date hereof and
continuing through the close of trading on the date 180 days after the
date of the Prospectus.
The foregoing paragraph shall not prohibit (i) bona fide gifts
made to any person or entity or (ii) distributions by a Selling
Stockholder to its partners (if the Selling Stockholder is a
partnership) or shareholders (if the Selling Stockholder is a
corporation); provided that such donee or distributee agrees in writing
to be bound by the provisions of this subsection as if it were the
Selling Stockholder named therein, which written agreement shall have
been executed and delivered to Xxxxxxxxxx Securities prior to such gift
or distribution.
ii) Delivery of Forms W-8 and W-9. To deliver to the
Representatives prior to the First 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).
Xxxxxxxxxx Securities, on behalf of the several Underwriters,
may, in its sole discretion, waive in writing the performance by the Company or
any Selling Stockholder of any one or more of the foregoing covenants or extend
the time for their performance.
SECTION 4. PAYMENT OF EXPENSES. The Company agrees to pay all
costs, fees and expenses incurred in connection with the performance of its and
the Selling Stockholders' obligations (other than the Selling Stockholders'
obligations relating to underwriting discounts and commissions applicable to
sales by the Selling Stockholders, transfer taxes, personal taxes and any fees
and expenses of counsel engaged by the Selling Stockholders other than Xxxxxx
Godward LLP, which discounts and commissions, transfer taxes, personal taxes and
fees of such counsel shall be paid by such Selling Stockholders) hereunder and
in connection with the transactions contemplated hereby, including without
limitation (i) all expenses incident to the issuance and delivery of the Common
Shares (including all printing and engraving costs), (ii) all fees and expenses
of the registrar and transfer agent of the Common Stock, (iii) all necessary
issue, transfer and other stamp taxes in connection with the issuance and sale
of the Common
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Shares to the Underwriters, (iv) all fees and expenses of the Company's counsel,
independent public or certified pubic accountants and other advisors, (v) all
costs and expenses incurred in connection with the preparation, printing,
filing, shipping and distribution of the Registration Statement (including
financial statements, exhibits, schedules, consents and certificates of
experts), each preliminary prospectus and the Prospectus, and all amendments and
supplements thereto, and this Agreement, (vi) all filing fees, attorneys' fees
and expenses incurred by the Company or the Underwriters in connection with
qualifying or registering (or obtaining exemptions from the qualification or
registration of) all or any part of the Common Shares for offer and sale under
the state securities or blue sky laws or the provincial securities laws of
Canada, and, if requested by the Representatives, preparing and printing a "Blue
Sky Survey" or memorandum, and any supplements thereto, advising the
Underwriters of such qualifications, registrations and exemptions, (vii) the
filing fees incident to, and the reasonable fees and expenses of counsel for the
Underwriters in connection with, the NASD's review and approval of the
Underwriters' participation in the offering and distribution of the Common
Shares, (viii) the fees and expenses associated with including the Common Stock
on the Nasdaq National Market, and (ix) all other fees, costs and expenses
referred to in Item 13 of Part II of the Registration Statement. Except as
provided in this Section , Section , Section and Section hereof, the
Underwriters shall pay their own expenses, including the fees and disbursements
of their counsel.
This Section shall not affect or modify any separate, valid
agreement relating to the allocation of payment of expenses between the Company,
on the one hand, and the Selling Stockholders, on the other hand.
SECTION 5. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the several Underwriters to purchase and pay for the Common
Shares as provided herein on the First Closing Date and, with respect to the
Optional Common Shares, the Second Closing Date, shall be subject to the
accuracy of the representations and warranties (except that, with respect to
clause (i) of Section hereof, subsequent to the respective dates as of which
information is given in the Prospectus, there shall not have been any Material
Adverse Change, except as otherwise disclosed in the Prospectus or in the
certificate delivered pursuant to Section hereof, which exception shall not
affect the availability of the condition set forth in Section hereof) on the
part of the Company and the Selling Stockholders set forth in Sections and
hereof as of the date hereof and as of the First Closing Date as though then
made and, with respect to the Optional Common Shares, as of the Second Closing
Date as though then made, to the timely performance by the Company and the
Selling Stockholders of their respective covenants and other obligations
hereunder, and to each of the following additional conditions:
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A) Accountants' Comfort Letter. On the date hereof, the
Representatives shall have received from Deloitte & Touche LLP, independent
public or certified public accountants for the Company, a letter dated the date
hereof addressed to the Underwriters, in form and substance satisfactory to the
Representatives, containing statements and information of the type ordinarily
included in accountant's "comfort letters" to underwriters, delivered according
to Statement of Auditing Standards No. 72 (or any successor bulletin), with
respect to the audited and unaudited financial statements and certain financial
information contained in the Registration Statement and the Prospectus (and the
Representatives shall have received an additional 10 conformed copies of such
accountants' letter for each of the several Underwriters).
B) Compliance with Registration Requirements; No Stop Order; No
Objection from NASD. As of the First Closing Date and, with respect to the
Optional Common Shares, the Second Closing Date:
i) the Company shall have filed the Prospectus with the
Commission (including the information required by Rule 430A under the
Securities Act) in the manner and within the time period required by
Rule 424(b) under the Securities Act; or the Company shall have filed a
pre- or post-effective amendment to the Registration Statement
containing the information required by such Rule 430A, and such pre- or
post-effective amendment shall have become effective; or, if the Company
elected to rely upon Rule 434 under the Securities Act and obtained the
Representatives' consent thereto, the Company shall have filed a Term
Sheet with the Commission in the manner and within the time period
required by such Rule 424(b);
ii) no stop order suspending the effectiveness of the
Registration Statement, any Rule 462(b) Registration Statement, or any
post-effective amendment to the Registration Statement, shall be in
effect and no proceedings for such purpose shall have been instituted or
threatened by the Commission; and
iii) the NASD shall have raised no objection to the
fairness and reasonableness of the underwriting terms and arrangements.
C) No Material Adverse Change. For the period from and after the
date of this Agreement and prior to the First Closing Date and, with respect to
the Optional Common Shares, the Second Closing Date, in the judgment of the
Representatives there shall not have occurred any Material Adverse Change that
makes it impracticable to market the Common Shares in the manner and on the
terms described in the Prospectus.
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D) Opinion of Counsel for the Company. On each of the First
Closing Date and the Second Closing Date the Representatives shall have received
the favorable opinion of Xxxxxx Godward LLP, counsel for the Company, dated as
of such Closing Date, the form of which is attached as Exhibit A (and the
Representatives shall have received an additional 10 conformed copies of such
counsel's legal opinion for each of the several Underwriters).
E) Opinion of Counsel for the Underwriters. On each of the First
Closing Date and the Second Closing Date the Representatives shall have received
the favorable opinion of Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx LLP, counsel for the
Underwriters, dated as of such Closing Date, with respect to the matters set
forth in paragraphs (i), (vii), (viii), (ix) and (x) and the next-to-last
paragraph of Exhibit A (and the Representatives shall have received an
additional 10 conformed copies of such counsel's legal opinion for each of the
several Underwriters).
F) Officers' Certificate. On each of the First Closing Date and
the Second Closing Date the Representatives shall have received a written
certificate executed by the Chairman of the Board and Chief Executive Officer of
the Company and the Vice President, Finance, Chief Financial Officer and
Secretary of the Company, dated as of such Closing Date, to the effect set forth
in subsection hereof, and further to the effect that:
i) except as otherwise stated in such certificate, for
the period from and after the date of this Agreement and prior to such
Closing Date, there has not occurred any Material Adverse Change;
ii) the representations, warranties and covenants of the
Company set forth in Section of this Agreement are true and correct with
the same force and effect as though expressly made on and as of such
Closing Date, except, with respect solely to clause (i) of Section , as
otherwise stated in such certificate; and
iii) the Company has complied with all the agreements and
satisfied all the conditions on its part to be performed or satisfied at
or prior to such Closing Date.
G) Bring-down Comfort Letter. On each of the First Closing Date
and the Second Closing Date the Representatives shall have received from
Deloitte & Touche LLP, independent public or certified public accountants for
the Company, a letter dated such date, in form and substance satisfactory to the
Representatives, to the effect that they reaffirm the statements made in the
letter furnished by them pursuant to subsection hereof, except that the
specified date referred to therein for the carrying out of procedures shall be
no more than three business days prior to the First Closing Date or Second
Closing Date, as the case may be (and the Representatives shall have received an
additional 10 conformed
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copies of such accountants' letter for each of the several Underwriters).
H) Opinion of Counsel for the Selling Stockholders. On the First
Closing Date the Representatives shall have received the favorable opinion of
Xxxxxx Godward LLP, counsel for those Selling Stockholders who are individuals,
and the favorable opinions of the respective counsels of each of the other
Selling Stockholders, each dated as of such Closing Date, the forms of which are
attached as Exhibit B-1 and Exhibit B-2 (with such modifications as are
acceptable to the Representatives), respectively (and the Representatives shall
have received an additional 10 conformed copies of each such counsel's legal
opinion for each of the several Underwriters).
I) Selling Stockholders' Certificate. On the First Closing Date
the Representatives shall have received a written certificate executed by the
Attorney-in-Fact of each Selling Stockholder, dated as of such Closing Date, to
the effect that:
i) the representations, warranties and covenants of such
Selling Stockholder set forth in Section of this Agreement are true and
correct with the same force and effect as though expressly made by such
Selling Stockholder on and as of such Closing Date; and
ii) such Selling Stockholder has complied with all the
agreements and satisfied all the conditions on its part to be performed
or satisfied at or prior to such Closing Date.
J) Selling Stockholders' Documents. On or before the date
hereof, the Company and the Selling Stockholders shall have furnished for review
by the Representatives copies of the Powers of Attorney and Custody Agreements
executed by each of the Selling Stockholders and such further information,
certificates and documents as the Representatives may reasonably request.
K) Lock-Up Agreement from Stockholders of the Company. On or
before the date hereof, the Company shall have furnished to the Representatives
(i) an agreement in the form of Exhibit C hereto from each director and officer
and from beneficial owners of Common Stock, options or warrants to purchase
Common Stock or any securities convertible into Common Stock representing 89% of
the Common Stock on a fully diluted basis, and (ii) evidence satisfactory to the
Representatives that beneficial owners of Common Stock, options or warrants to
purchase Common Stock or any securities convertible into Common Stock
representing an additional 9% of the Common Stock on a fully diluted basis are
subject to contractual restrictions on the transfer of their securities. In each
case, such agreements shall be in full force and effect on each of the First
Closing Date and the Second Closing Date.
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L) Additional Documents. On or before each of the First Closing
Date and the Second Closing Date, the Representatives and counsel for the
Underwriters shall have received such information, documents and opinions as
they may reasonably require for the purposes of enabling them to pass upon the
issuance and sale of the Common Shares as contemplated herein, or in order to
evidence the accuracy of any of the representations and warranties, or the
satisfaction of any of the conditions or agreements, herein contained.
If any condition specified in this Section hereof is not
satisfied when and as required to be satisfied, this Agreement may be terminated
by the Representatives by notice to the Company and the Selling Stockholders at
any time on or prior to the First Closing Date and, with respect to the Optional
Common Shares, at any time prior to the Second Closing Date, which termination
shall be without liability on the part of any party to any other party, except
that Section , Section , Section and Section hereof shall at all times be
effective and shall survive such termination.
SECTION 6. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If this
Agreement is terminated by the Representatives pursuant to Section , Section
(i)(a), (iv), (v) or Section hereof, or if the sale to the Underwriters of the
Common Shares on the First Closing Date is not consummated because of any
refusal, inability or failure on the part of the Company or the Selling
Stockholders to perform any agreement herein or to comply with any provision
hereof, the Company agrees to reimburse the Representatives and the other
Underwriters, severally, upon demand for all out-of-pocket expenses that shall
have been reasonably incurred by the Representatives and the Underwriters in
connection with the proposed purchase and the offering and sale of the Common
Shares, including but not limited to reasonable fees and disbursements of
counsel, printing expenses, travel expenses, postage, facsimile and telephone
charges. Notwithstanding the foregoing sentence, the Representatives and the
other Underwriters shall not be entitled to such reimbursement of expenses in
the event that this Agreement is terminated by the Representatives (i) pursuant
to Section 5(C) or 10(iv), as a result of adverse changes resulting solely from
general economic conditions or conditions affecting generally the industry in
which the Company operates, or (ii) pursuant to Section 10(v), so long as the
event causing such termination shall not have interfered or be reasonably likely
to interfere materially with the conduct of the business and operations of the
Company regardless of whether or not such loss shall have been insured.
SECTION 7. INDEMNIFICATION.
A) Indemnification of the Underwriters. The Company agrees to
indemnify and hold harmless each Underwriter, its officers and employees, and
each person, if any, who controls any Underwriter within the meaning of the
Securities Act and the
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Exchange Act against any loss, claim, damage, liability or expense, as incurred,
to which such Underwriter or such controlling person may become subject, under
the Securities Act, the Exchange Act or other federal or state statutory law or
regulation, or at common law or otherwise (including in settlement of any
litigation, if such settlement is effected with the written consent of the
Company), insofar as such loss, claim, damage, liability or expense (or actions
in respect thereof as contemplated below) arises out of or is based (i) upon any
untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement, or any amendment thereto, including any information
deemed to be a part thereof pursuant to Rule 430A or Rule 434 under the
Securities Act, or the omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the statements therein not
misleading; or (ii) upon any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto), or the omission or alleged omission therefrom
of a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; or (iii)
in whole or in part upon any inaccuracy in the representations and warranties of
the Company or the Selling Stockholders contained herein (provided that, for
purposes of the indemnification set forth herein, the representations and
warranties given in Section hereof shall be deemed to have been made, in each
case, without reference to the Exceptions (as defined therein)); or (iv) in
whole or in part upon any failure of the Company or the Selling Stockholders to
perform their respective obligations hereunder or under law; and to reimburse
each Underwriter and each such controlling person for any and all expenses
(including the fees and disbursements of counsel chosen by Xxxxxxxxxx
Securities) as such expenses are reasonably incurred by such Underwriter or such
controlling person in connection with investigating, defending, settling,
compromising or paying any such loss, claim, damage, liability, expense or
action; provided, however, that the foregoing indemnity agreement shall not
apply to any loss, claim, damage, liability or expense to the extent, but only
to the extent, arising out of or based upon any untrue statement or alleged
untrue statement or omission or alleged omission made in reliance upon and in
conformity with written information furnished to the Company and the Selling
Stockholders by the Representatives expressly for use in the Registration
Statement, any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto); and provided, further, that with respect to any preliminary
prospectus, the foregoing indemnity agreement shall not inure to the benefit of
any Underwriter from whom the person asserting any loss, claim, damage,
liability or expense purchased Common Shares, or any person controlling such
Underwriter, if copies of the Prospectus were timely delivered to the
Underwriter pursuant to Section hereof and a copy of the Prospectus (as then
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) was not sent or given by or on behalf of such Underwriter
to such person, if required by law so to have been delivered, at or prior to the
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written confirmation of the sale of the Common Shares to such person, and if the
Prospectus (as so amended or supplemented) would have cured the defect giving
rise to such loss, claim, damage, liability or expense.
Each Selling Stockholder, severally and not jointly, agrees to
indemnify and hold harmless the Company, each Underwriter, the directors,
officers, employees and agents of the Company and each Underwriter, and each
person, if any, who controls the Company or any Underwriter within the meaning
of the Securities Act or the Exchange Act against any loss, claim, damage,
liability or expense, as incurred, to which the Company, such Underwriter or
such controlling person may become subject, under the Securities Act, the
Exchange Act or other federal or state statutory law or regulation, or at common
law or otherwise (including in settlement of any litigation, if such settlement
is effected with the written consent of such Selling Stockholder), insofar as
such loss, claim, damage, liability or expense (or actions in respect thereof as
contemplated below) arises out of or is based (i) upon any untrue statement or
alleged untrue statement of a material fact contained in any information
provided by such Selling Stockholder specifically for use in the preparation of
the Registration Statement, or any amendment thereto, including any information
deemed to be a part thereof pursuant to Rule 430A or Rule 434 under the
Securities Act, or the omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the statements therein not
misleading; or (ii) upon any untrue statement or alleged untrue statement of a
material fact contained in any information provided by such Selling Stockholder
specifically for use in the preparation of any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; or (iii) in whole or in part upon any inaccuracy in the
representations and warranties of such Selling Stockholder contained herein; or
(iv) in whole or in part upon any failure of the such Selling Stockholder to
perform its obligations hereunder or under law; and to reimburse the Company,
each Underwriter and each such controlling person for any and all expenses
(including the fees and disbursements of counsel chosen by Xxxxxxxxxx
Securities) as such expenses are reasonably incurred by the Company, such
Underwriter or such controlling person in connection with investigating,
defending, settling, compromising or paying any such loss, claim, damage,
liability, expense or action; provided, however, that the foregoing indemnity
agreement shall not apply to any loss, claim, damage, liability or expense to
the extent, but only to the extent, arising out of or based upon any untrue
statement or alleged untrue statement or omission or alleged omission made in
reliance upon and in conformity with written information furnished to the
Company and the Selling Stockholders by the Representatives expressly for use in
the Registration Statement, any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto); and provided, further, that with respect to
any preliminary prospectus, the
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foregoing indemnity agreement shall not inure to the benefit of any Underwriter
from whom the person asserting any loss, claim, damage, liability or expense
purchased Common Shares, or any person controlling such Underwriter, if copies
of the Prospectus were timely delivered to the Underwriter pursuant to Section
hereof and a copy of the Prospectus (as then amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) was not sent
or given by or on behalf of such Underwriter to such person, if required by law
so to have been delivered, at or prior to the written confirmation of the sale
of the Common Shares to such person, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such loss, claim,
damage, liability or expense; and provided, further, that the liability of each
Selling Stockholder to the Company, the Underwriters or any other person shall
be limited to an amount equal to the net proceeds received (after deducting
underwriters' discounts and commissions) by such Selling Stockholder from the
sale of the Common Shares contemplated hereby.
The indemnity agreement set forth in this Section shall be in
addition to any liabilities that the Company and the Selling Stockholders may
otherwise have.
B) Indemnification by the Underwriters. Each Underwriter agrees,
severally and not jointly, to indemnify and hold harmless the Company, each of
its directors, each of its officers who signed the Registration Statement, the
Selling Stockholders and each person, if any, who controls the Company or any
Selling Stockholder within the meaning of the Securities Act or the Exchange
Act, against any loss, claim, damage, liability or expense, as incurred, to
which the Company, or any such director, officer, Selling Stockholder or
controlling person may become subject, under the Securities Act, the Exchange
Act, or other federal or state statutory law or regulation, or at common law or
otherwise (including in settlement of any litigation, if such settlement is
effected with the written consent of such Underwriter), insofar as such loss,
claim, damage, liability or expense (or actions in respect thereof as
contemplated below) arises out of or is based upon any untrue or alleged untrue
statement of a material fact contained in the Registration Statement, any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto), or arises out of or is based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in the Registration Statement, any preliminary
prospectus, the Prospectus (or any amendment or supplement thereto), in reliance
upon and in conformity with written information furnished to the Company and the
Selling Stockholders by the Representatives expressly for use therein; and to
reimburse the Company, or any such director, officer, Selling Stockholder or
controlling person for any legal and other expense reasonably incurred by the
Company, or any such
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director, officer, Selling Stockholder or controlling person in connection with
investigating, defending, settling, compromising or paying any such loss, claim,
damage, liability, expense or action. Each of the Company and each of the
Selling Stockholders, hereby acknowledges that the only information that the
Underwriters have furnished to the Company and the Selling Stockholders
expressly for use in the Registration Statement, any preliminary prospectus or
the Prospectus (or any amendment or supplement thereto) are the statements set
forth (A) as the first paragraph on the inside front cover page of the
Prospectus concerning stabilization by the Underwriters and (B) in the table in
the first paragraph and as the second paragraph, the third sentence of the sixth
paragraph, the seventh paragraph, the eight paragraph and the ninth paragraph
under the caption "Underwriting" in the Prospectus; and the Underwriters confirm
that such statements are correct. The indemnity agreement set forth in this
Section shall be in addition to any liabilities that each Underwriter may
otherwise have.
C) Notifications and Other Indemnification Procedures. Promptly
after receipt by an indemnified party under this Section of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against an indemnifying party under this Section , notify
the indemnifying party in writing of the commencement thereof, but the omission
so to notify the indemnifying party will not relieve it from any liability which
it may have to any indemnified party for contribution or otherwise than under
the indemnity agreement contained in this Section or to the extent it is not
prejudiced as a proximate result of such failure. In case any such action is
brought against any indemnified party and such indemnified party seeks or
intends to seek indemnity from an indemnifying party, the indemnifying party
will be entitled to participate in, and, to the extent that it shall elect,
jointly with all other indemnifying parties similarly notified, 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, if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that a conflict may arise between the positions of the indemnifying party and
the indemnified party in conducting the defense of any such action or that there
may be legal defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying party, the
indemnified party or parties shall have the right to select separate counsel to
assume such legal defenses and to otherwise participate in the defense of such
action on behalf of such indemnified party or parties. Upon receipt of notice
from the indemnifying party to such indemnified party of such indemnifying
party's election so to assume the defense of such action and approval by the
indemnified party of counsel, 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
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connection with the defense thereof unless (i) the indemnified party shall have
employed separate counsel in accordance with the proviso to the next preceding
sentence (it being understood, however, that the indemnifying party shall not be
liable for the expenses of more than one separate counsel (together with local
counsel), approved by the indemnifying party (Xxxxxxxxxx Securities in the case
of Section and Section hereof), representing the indemnified parties who are
parties to such action) or (ii) the indemnifying party shall not have employed
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action, in each of which cases the fees and expenses of counsel shall be at the
expense of the indemnifying party.
D) Settlements. The indemnifying party under this Section shall
not be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
against any loss, claim, damage, liability or expense by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for reasonable fees and expenses of counsel as contemplated by
Section hereof, the indemnifying party agrees that it shall be liable for any
reasonable settlement of any proceeding effected without its written consent if
(i) such settlement is entered into more than 60 days after receipt by such
indemnifying party of the aforesaid request and 30 days after receipt of notice
of the terms of such settlement and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to the
date of such settlement; provided that, the indemnified party shall promptly
reimburse any amounts paid to or on behalf of such indemnified party in the
event such indemnification obligation is ultimately determined to be improper
whether by a court or is in excess of amounts agreed upon through negotiation
between the parties. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement, compromise or consent
to the entry of judgment in any pending or threatened action, suit or proceeding
in respect of which any indemnified party is or could have been a party and
indemnity was or could have been sought hereunder by such indemnified party,
unless such settlement, compromise or consent includes an unconditional release
of such indemnified party from all liability on claims that are the subject
matter of such action, suit or proceeding.
SECTION 8. CONTRIBUTION.
If the indemnification provided for in Section hereof is for any
reason held to be unavailable to or otherwise insufficient to hold harmless an
indemnified party in respect of any losses, claims, damages, liabilities or
expenses referred to
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therein, then each indemnifying party shall contribute to the aggregate amount
paid or payable by such indemnified party, as incurred, as a result of any
losses, claims, damages, liabilities or expenses referred to therein (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and each Selling Stockholder severally and not jointly, on the one hand,
and the Underwriters, on the other hand, from the offering of the Common Shares
pursuant to this Agreement or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company and each Selling Stockholder severally
and not jointly, on the one hand, and the Underwriters, on the other hand, in
connection with the statements or omissions or inaccuracies in the
representations and warranties herein which resulted in such losses, claims,
damages, liabilities or expenses, as well as any other relevant equitable
considerations provided, however, that in no case shall any Selling Stockholder
be liable or responsible for any amount in excess of the net proceeds received
(after deducting the Underwriters' discounts and commissions) by such Selling
Stockholder in the offering, provided, further, that the Company shall be
responsible for any amounts that would have been allocable to a Selling
Stockholder but for such limitation. The relative benefits received by the
Company and the Selling Stockholders, on the one hand, and the Underwriters, on
the other hand, in connection with the offering of the Common Shares pursuant to
this Agreement shall be deemed to be in the same respective proportions as the
total net proceeds from the offering of the Common Shares pursuant to this
Agreement (before deducting expenses) received by the Company and the Selling
Stockholders, and the total underwriting discount received by the Underwriters,
in each case as set forth on the front cover page of the Prospectus (or, if Rule
434 under the Securities Act is used, the corresponding location on the Term
Sheet) bear to the aggregate initial public offering price of the Common Shares
as set forth on such cover. The relative fault of the Company and each Selling
Stockholder, on the one hand, and the Underwriters, on the other hand, shall be
determined by reference to, among other things, whether any such untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact or any such inaccurate or alleged inaccurate
representation or warranty relates to information supplied by the Company or a
Selling Stockholder, 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 amount paid or payable by a party as a result of the losses,
claims, damages, liabilities and expenses referred to above shall be deemed to
include, subject to the limitations set forth in Section hereof, any legal or
other fees or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim. The provisions set forth in
Section hereof with respect to notice of commencement of any
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34
action shall apply if a claim for contribution is to be made under this Section
; provided, however, that no additional notice shall be required with respect to
any action for which notice has been given under Section hereof for purposes of
indemnification.
The Company, the Selling Stockholders and the Underwriters agree
that it would not be just and equitable if contribution pursuant to this Section
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 in this Section .
Notwithstanding the provisions of this Section , no Underwriter
shall be required to contribute any amount in excess of the underwriting
discount received by such Underwriter in connection with the Common Shares
underwritten by it. 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. The Underwriters' obligations to contribute pursuant to this
Section are several, and not joint, in proportion to their respective
underwriting commitments as set forth opposite their names in Schedule A. For
purposes of this Section , each officer and employee of an Underwriter and each
person, if any, who controls an Underwriter within the meaning of the Securities
Act and the Exchange Act shall have the same rights to contribution as such
Underwriter, and each director of the Company, each officer of the Company who
signed the Registration Statement, and each person, if any, who controls the
Company with the meaning of the Securities Act and the Exchange Act shall have
the same rights to contribution as the Company.
SECTION 9. DEFAULT OF ONE OR MORE OF THE SEVERAL UNDERWRITERS.
If, on the First Closing Date or the Second Closing Date, as the case may be,
any one or more of the several Underwriters shall fail or refuse to purchase
Common Shares that it or they have agreed to purchase hereunder on such date,
and the aggregate number of Common Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase does not exceed 10% of the
aggregate number of the Common Shares to be purchased on such date, the other
Underwriters shall be obligated, severally, in the proportions that the number
of Firm Common Shares set forth opposite their respective names on Schedule A
bears to the aggregate number of Firm Common Shares set forth opposite the names
of all such non-defaulting Underwriters, or in such other proportions as may be
specified by the Representatives with the consent of the non-defaulting
Underwriters, to purchase the Common Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date. If, on the
First Closing Date or the Second Closing Date, as the case may be, any one or
more of the Underwriters shall fail or refuse to purchase Common Shares and
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the aggregate number of Common Shares with respect to which such default occurs
exceeds 10% of the aggregate number of Common Shares to be purchased on such
date, and arrangements satisfactory to the Representatives and the Company for
the purchase of such Common Shares are not made within 48 hours after such
default, this Agreement shall terminate without liability of any party to any
other party except that the provisions of Section , Section , Section and
Section hereof shall at all times be effective and shall survive such
termination. In any such case either the Representatives or the Company shall
have the right to postpone the First Closing Date or the Second Closing Date, as
the case may be, but in no event for longer than seven days in order that the
required changes, if any, to the Registration Statement and the Prospectus or
any other documents or arrangements may be effected.
As used in this Agreement, the term "Underwriter" shall be deemed
to include any person substituted for a defaulting Underwriter under this
Section . Any action taken under this Section shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
SECTION 10. TERMINATION OF THIS AGREEMENT. Prior to the First
Closing Date this Agreement may be terminated by the Representatives by notice
given to the Company and the Selling Stockholders if at any time (i)(a) trading
or quotation in any of the Company's securities shall have been suspended or
limited by the Commission or by the Nasdaq Stock Market, or (b) trading in
securities generally on either the Nasdaq Stock Market or the New York Stock
Exchange shall have been suspended or limited, or minimum or maximum prices
shall have been generally established on any of such stock exchanges by the
Commission or the NASD; (ii) a general banking moratorium shall have been
declared by any of federal, New York, Delaware or California authorities; (iii)
there shall have occurred any outbreak or escalation of national or
international hostilities or any crisis or calamity, or any change in the United
States or international financial markets, or any substantial change or
development involving a prospective substantial change in United States' or
international political, financial or economic conditions, as in the judgment of
the Representatives is material and adverse and makes it impracticable to market
the Common Shares in the manner and on the terms described in the Prospectus or
to enforce contracts for the sale of securities; (iv) in the judgment of the
Representatives there shall have occurred any Material Adverse Change that makes
it impracticable to market the Common Shares in the manner and on the terms
described in the Prospectus; or (v) the Company shall have sustained a loss by
strike, fire, flood, earthquake, accident or other calamity of such character as
in the judgment of the Representatives would be reasonably likely to interfere
materially with the conduct of the business and operations of the Company
regardless of whether or not such loss shall have been insured. Any termination
pursuant to this Section shall be without liability on the part of (a) the
Company or the Selling
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Stockholders to any Underwriter, except that the Company shall be obligated to
reimburse the expenses of the Representatives and the Underwriters pursuant to
Sections and hereof, (b) any Underwriter to the Company or the Selling
Stockholders, or (c) any party hereto to any other party except that the
provisions of Section and Section hereof shall at all times be effective and
shall survive such termination.
SECTION 11. REPRESENTATIONS AND INDEMNITIES TO SURVIVE DELIVERY.
The respective indemnities, agreements, representations, warranties and other
statements of the Company, its officers, the Selling Stockholders and the
several Underwriters set forth in or made pursuant to this Agreement will remain
in full force and effect, regardless of any investigation made by or on behalf
of any Underwriter or the Company or any of its or their partners, officers or
directors or any controlling person, or the Selling Stockholders, as the case
may be, and will survive delivery of and payment for the Common Shares sold
hereunder and any termination of this Agreement.
SECTION 12. NOTICES. All communications hereunder shall be in
writing and shall be mailed, hand delivered or telecopied and confirmed to the
parties hereto as follows:
If to the Representatives:
Xxxxxxxxxx Securities
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Facsimile: 000-000-0000
Attention: Xxxxxxx X. Xxxxx
with a copy to:
Xxxxxxxxxx Securities
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxx X. Xxxxxx, Esq.
If to the Company:
Il Fornaio (America) Corporation
0000 Xxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx X. Xxxxxx
If to the Selling Stockholders:
BankBoston, N.A.
000 Xxxxxx Xxxxxx
Mail Stop 00-00-00
-00-
00
Xxxxxx, Xxxxxxxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx XxXxxx
Any party hereto may change the address for receipt of communications by giving
written notice to the others.
SECTION 13. SUCCESSORS. This Agreement will inure to the benefit
of and be binding upon the parties hereto, including any substitute Underwriters
pursuant to Section hereof, and to the benefit of the employees, officers and
directors and controlling persons referred to in Section and Section
hereof, and in each case their respective successors, and personal
representatives, and no other person will have any right or obligation
hereunder. The term "successors" shall not include any purchaser of the Common
Shares as such from any of the Underwriters merely by reason of such purchase.
SECTION 14. PARTIAL UNENFORCEABILITY. The invalidity or
unenforceability of any Section, paragraph or provision of this Agreement shall
not affect the validity or enforceability of any other Section, paragraph or
provision hereof. If any Section, paragraph or provision of this Agreement is
for any reason determined to be invalid or unenforceable, there shall be deemed
to be made such minor changes (and only such minor changes) as are necessary to
make it valid and enforceable.
SECTION 15. GOVERNING LAW PROVISIONS.
A) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF CALIFORNIA
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE.
B) Consent to Jurisdiction. Any legal suit, action or proceeding
arising out of or based upon this Agreement or the transactions contemplated
hereby ("Related Proceedings") may be instituted in the federal courts of the
United States of America located in the City and County of San Francisco or the
courts of the State of California in each case located in the City and County of
San Francisco (collectively, the "Specified Courts"), and each party irrevocably
submits to the exclusive jurisdiction (except for proceedings instituted in
regard to the enforcement of a judgment of any such court (a "Related
Judgment"), as to which such jurisdiction is non-exclusive) of such courts in
any such suit, action or proceeding. Service of any process, summons, notice or
document by mail to such party's address set forth above shall be effective
service of process for any suit, action or other proceeding brought in any such
court. The parties irrevocably and unconditionally waive any objection to the
laying of venue of any suit, action or other proceeding in the Specified Courts
and irrevocably and unconditionally waive and agree not to
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plead or claim in any such court that any such suit, action or other proceeding
brought in any such court has been brought in an inconvenient forum. Each party
not located in the United States irrevocably appoints CT Corporation System,
which currently maintains a San Francisco office at 00 Xxxxxxxxx Xxxxxx, Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000, Xxxxxx Xxxxxx of America, as its agent to receive
service of process or other legal summons for purposes of any such suit, action
or proceeding that may be instituted in any state or federal court in the City
and County of San Francisco.
SECTION 16. FAILURE OF ONE OR MORE OF THE SELLING STOCKHOLDERS TO
SELL AND DELIVER COMMON SHARES. If (A) one or more of the Selling Stockholders
shall fail to sell and deliver to the Underwriters the Common Shares to be sold
and delivered by such Selling Stockholders at the First Closing Date pursuant to
this Agreement and (B) the Company shall fail or be unable to sell and deliver
to the Underwriters an additional amount of Common Shares equal to the number of
Common Shares to be sold and delivered by such Selling Stockholder at the First
Closing Date without delay, then the Underwriters may at their option, by
written notice from the Representatives to the Company and the Selling
Stockholders, either (i) terminate this Agreement without any liability on the
part of any Underwriter or, except as provided in Sections , , and hereof, the
Company or the Selling Stockholders, or (ii) purchase the shares which the
Company and other Selling Stockholders have agreed to sell and deliver in
accordance with the terms hereof. If one or more of the Selling Stockholders
shall fail to sell and deliver to the Underwriters the Common Shares to be sold
and delivered by such Selling Stockholders pursuant to this Agreement at the
First Closing Date, then the Underwriters shall have the right, by written
notice from the Representatives to the Company and the Selling Stockholders, to
postpone the First Closing Date, but in no event for longer than seven days in
order that the required changes, if any, to the Registration Statement and the
Prospectus or any other documents or arrangements may be effected.
SECTION 17. GENERAL PROVISIONS. This Agreement constitutes the
entire agreement of the parties to this Agreement and supersedes all prior
written or oral and all contemporaneous oral agreements, understandings and
negotiations with respect to the subject matter hereof. This Agreement may be
executed in two or more counterparts, each one of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement may not be amended or modified unless in writing by
all of the parties hereto, and no condition herein (express or implied) may be
waived unless waived in writing by each party whom the condition is meant to
benefit. The Table of Contents and the Section headings herein are for the
convenience of the parties only and shall not affect the construction or
interpretation of this Agreement.
-34-
39
Each of the parties hereto acknowledges that it is a
sophisticated business person who was adequately represented by counsel during
negotiations regarding the provisions hereof, including, without limitation, the
indemnification provisions of Section hereof and the contribution provisions of
Section hereof, and is fully informed regarding said provisions. Each of the
parties hereto further acknowledges that the provisions of Sections and hereof
fairly allocate the risks in light of the ability of the parties to investigate
the Company, its affairs and its business in order to assure that adequate
disclosure has been made in the Registration Statement, any preliminary
prospectus and the Prospectus (and any amendments and supplements thereto), as
required by the Securities Act and the Exchange Act.
[Signature Page Next]
-35-
40
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to the Company and the Custodian the enclosed
copies hereof, whereupon this instrument, along with all counterparts hereof,
shall become a binding agreement in accordance with its terms.
Very truly yours,
IL FORNAIO (AMERICA) CORPORATION
By: /s/ Xxxxxxxx X. Xxxxxx
-------------------------------------
Xxxxxxxx X. Xxxxxx
Chairman of the Board and
Chief Executive Officer
SELLING STOCKHOLDERS
By: /s/ Xxxxxxxx X. Xxxxxx
-------------------------------------
(Attorney-in-fact)
-36-
41
The foregoing Underwriting Agreement is hereby confirmed and
accepted by the Representatives in San Francisco, California as of the date
first above written.
XXXXXXXXXX SECURITIES
BT ALEX. XXXXX INCORPORATED
Acting as Representatives of the several Underwriters named in the attached
Schedule A.
By: XXXXXXXXXX SECURITIES
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Authorized Signatory
-37-
42
SCHEDULE A
============================================================
NUMBER OF
FIRM COMMON
SHARES TO BE
UNDERWRITERS PURCHASED
------------------------------------------------------------
Xxxxxxxxxx Securities 510,000
------------------------------------------------------------
BT Alex. Xxxxx Incorporated 510,000
------------------------------------------------------------
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities
Corporation 80,000
------------------------------------------------------------
Xxxxxxxxx, Xxxxxxxx & Company LLC 80,000
------------------------------------------------------------
Xxxxxxxx & Co. Inc. 80,000
------------------------------------------------------------
Xxxxxxx and X. Xxxxxxxxxxxx, Inc. 40,000
------------------------------------------------------------
Cruttenden Xxxx Incorporated 40,000
------------------------------------------------------------
Xxxxxxxxxx & Co. Inc. 40,000
------------------------------------------------------------
Hampshire Securities Corporation 40,000
------------------------------------------------------------
Xxxxxxx Xxxxx & Associates, Inc. 40,000
------------------------------------------------------------
X.X. Xxxxxxxxxx & Co., Inc. 40,000
------------------------------------------------------------
Total 1,500,000
------------------------------------------------------------
============================================================
43
SCHEDULE B
===============================================
NUMBER OF
FIRM COMMON
SHARES TO BE
SELLING STOCKHOLDER SOLD
-----------------------------------------------
Xxxxxxx Xxxxxxxx
c/o Xxxxxx X. Xxxxxxx
Xxxxxxxx & Co.
00000 Xxxxxxxx Xxxx., 0xx Xxxxx
Xxx Xxxxxxx, XX 00000 5,000
-----------------------------------------------
Xxxxxxx X. Xxxxxxxx
c/o Xxxxxx X. Xxxxxxx
Xxxxxxxx & Co.
00000 Xxxxxxxx Xxxx., 0xx Xxxxx
Xxx Xxxxxxx, XX 00000 5,000
-----------------------------------------------
Xxxxxx X. Xxxxxx XX
000 Xx. Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000 3,000
-----------------------------------------------
Xxxxxxx X. Xxxxxxx
000 Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000 12,620
-----------------------------------------------
Xxxxxx Xxxxxxxxxxx
0000 X. Xxxxx
Xxxxxxx, XX 00000 6,310
-----------------------------------------------
Collingwood Partners
c/o Xxxxxxx X. Xxxxx
Xxxxxx X. Xxxxxxx and Associates
0000 Xxxxxxxx Xxxx., Xxxxx 000
Xxxxxxx Xxxxx, XX 00000 25,240
-----------------------------------------------
Dorskind 1982 Trust
c/o Xxxxxx X. Xxxxxxxx
000 X. Xxxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000 3,000
-----------------------------------------------
Xxxxxxx and Xxxxxx Xxxxxxx
c/o Xxxxxx X. Xxxxxxx
Xxxxxxxx & Co.
00000 Xxxxxxxx Xxxx., 0xx Xxxxx
Xxx Xxxxxxx, XX 00000 5,000
===============================================
44
===============================================
Xxxxx X. Xxxxxx
c/o Wertheim Xxxxxxxx & Co., Inc.
00000 Xxxxxxxx Xxxx., Xxxxx 000
Xxx Xxxxxxx, XX 00000 4,000
-----------------------------------------------
Oak Brook Bank, Trustee Custodian
FBO Xxxxxx X. Xxxxx XXX
c/o Xxxxxx X. Xxxxxx
Oak Brook Bank
0000 X. 00xx Xxxxxx
Xxx Xxxxx, XX 00000 6,310
-----------------------------------------------
Xxxxx Xxxxxxxx
0000 Xxxxxx Xxxxx
Xxx Xxxxxxx, XX 00000 12,620
-----------------------------------------------
Xxxxxxx X. Xxxxxxxxx
Xxxxxxxxx, Xxxxx & Xxxxxx, LLP
0000 Xxxxxxxx Xxxx., 0xx Xxxxx
Xxxxxxx Xxxxx, XX 00000 3,000
-----------------------------------------------
InterWest Entrepreneurs
c/o Xxxxx Xxxxxx
InterWest Partners
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000 631
-----------------------------------------------
InterWest Partners I
c/o Xxxxx Xxxxxx
InterWest Partners
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000 17,709
-----------------------------------------------
InterWest Partners II
c/o Xxxxx Xxxxxx
InterWest Partners
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000 17,807
-----------------------------------------------
InterWest Partners IV
c/o Xxxxx Xxxxxx
InterWest Partners
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000 25,967
-----------------------------------------------
Xxxxxxx Xxxxxxx
00000 Xxxxxxxx Xxxx., #00
Xxx Xxxxxxx, XX 00000 3,000
-----------------------------------------------
C. Xxxxxx XxXxxxx
c/o Xxxxx Xxxxx, Inc.
00000 X. Xxxxxx Xxxxx Xxxx
Xx Xxxxx, XX 00000 3,046
===============================================
45
============================================================================
C. Xxxxxx XxXxxxx Defined Benefit Plan
c/o Xxxxx Xxxxx, Inc.
00000 X. Xxxxxx Xxxxx Xxxx
Xx Xxxxx, XX 00000 6,894
----------------------------------------------------------------------------
Xxxxxx X. Xxxxxx
00 Xxxxxxxx Xxxx
Xxxx Xxxxxx, XX 00000 8,000
----------------------------------------------------------------------------
Xxxx X. Xxxxxx
Xxxxxxxx & Co.
00000 Xxxxxxxx Xxxx., 0xx Xxxxx
Xxx Xxxxxxx, XX 00000 6,000
----------------------------------------------------------------------------
Delaware Charter Guaranteed Trust Co.
FBO Xxxxx Xxxxxx
The Magnin Co., Inc.
000 X. Xxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000 3,000
----------------------------------------------------------------------------
Xxxxx Xxxxx Xxxxxx and Xxxx Xxxxxx
Declaration of Trust
The Magnin Co., Inc.
000 X. Xxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000 12,620
----------------------------------------------------------------------------
Master Trust Pursuant to Hewlett Packard
Deferred Profit Sharing Plan and
Supplemental Pension Plan
Xxxxxx Xxxxxx
Hewlett Packard-1900
0000 X. Xxxx Xxxx Xxxx, Xxxx. 0X
Xxxx Xxxx, XX 00000 25,240
----------------------------------------------------------------------------
Xxxxxxxx V
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx 18,470
----------------------------------------------------------------------------
Xxxxxxxx Associates
Xxxxxxxx Associates Fund
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx 770
----------------------------------------------------------------------------
Xxxxxx and Xxx X. Xxxxx, Trustees of the Xxxxxx Xxxxx
and Xxx X. Xxxxx Revocable Living Trust dated August 23, 1995
Xxxxxx Xxxxx & Xxxxxxxx
Xxx Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000 3,000
============================================================================
46
============================================================================
Delaware Charter Guarantee & Trust, Trustee
FBO Xxxxxx X. Xxxxxxx XXX
Xxxxxxxx & Co.
00000 Xxxxxxxx Xxxx., 0xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxx 4,000
----------------------------------------------------------------------------
Sequoia Capital Growth Fund
c/o Xxx Xxxxxxxxxx
Sequoia Capital
0000 Xxxx Xxxx Xxxx, Xxxx. 0, Xxxxx 000
Xxxxx Xxxx, XX 00000 21,872
----------------------------------------------------------------------------
Sequoia Technology Partners III
c/o Xxx Xxxxxxxxxx
Sequoia Capital
0000 Xxxx Xxxx Xxxx, Xxxx. 0, Xxxxx 000
Xxxxx Xxxx, XX 00000 1,396
----------------------------------------------------------------------------
Xxxxx Fargo & Company
000 Xxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxx X. Xxxxx 219,478
----------------------------------------------------------------------------
Wilderess Associates
000 Xxxxxx Xxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx 10,000
----------------------------------------------------------------------------
Total 500,000
----------------------------------------------------------------------------
============================================================================
47
EXHIBIT A(1)
Opinion of counsel for the Company to be delivered pursuant to
Section of the Underwriting Agreement.
References to the Prospectus in this Exhibit A include any
supplements thereto at the Closing Date.
i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware.
ii) The Company has the requisite corporate power and authority
to own, lease and operate its property and assets and to conduct its
business as described in the Prospectus and to enter into and perform
its obligations under the Underwriting Agreement.
iii) The Company is duly qualified as a foreign corporation to
transact business and is in good standing in California, Colorado,
Nevada, Oregon and Washington and, to the best of such counsel's
knowledge, is not required to qualify as a foreign corporation to do
business in any other jurisdiction in the United States (other than
California, Colorado, Nevada, Oregon and Washington) where the failure
to so qualify or to be in good standing would, individually or in the
aggregate, result in a Material Adverse Change.
iv) The Company has __________ authorized shares of capital
stock, consisting of __________ shares of Common Stock and __________
shares of Preferred Stock. Immediately prior to the date of this opinion
letter, there were __________ shares of Common Stock, __________ shares
of Series A Preferred Stock, __________ shares of Series B Preferred
Stock, __________ shares of Series C Preferred Stock, __________ shares
of Series D Preferred Stock, __________ shares of Series E Preferred
Stock and __________ shares of Series F Preferred Stock issued and
outstanding. Except as described in Section "Capitalization and Other
Stockholder Matters" in the Underwriting Agreement (the "Exceptions"),
all of the outstanding shares of Common Stock (including the shares of
Common Stock owned by Selling Stockholders) have been duly authorized
and validly issued, are fully paid and nonassessable. The form of
certificate used to evidence shares of the Company's common stock
included as Exhibit 4.2 to the Registration Statement is in due and
proper form under Delaware law, and complies with all applicable
requirements of the certificate of incorporation
--------
(1) The final opinion in draft form must be attached as Exhibit A at the time
this Agreement is executed.
A-1
48
and by-laws of the Company and the General Corporation Law of the State
of Delaware.
v) Except as disclosed in the Prospectus and the Exceptions, to
the best of such counsel's knowledge, there are no outstanding options,
warrants or other rights calling for the issuance of, and no commitments
to issue any shares of capital stock of the Company or any security
convertible into or exchangeable for capital stock of the Company.
vi) Except as described in the Exceptions, no stockholder of the
Company or any other person has any preemptive right, right of first
refusal or other similar right to subscribe for or purchase securities
of the Company arising (i) by operation of the certificate of
incorporation or by-laws of the Company or under the General Corporation
Law of the State of Delaware or, (ii) to the best of such counsel's
knowledge, under any agreement to which the Company is a party.
vii) The Underwriting Agreement has been duly authorized,
executed and delivered by, and is a valid and binding agreement of, the
Company, enforceable in accordance with its terms, except as rights to
indemnification and contribution thereunder may be limited by applicable
laws and except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, arrangement, moratorium or other similar
laws relating to or affecting creditors' rights generally and subject to
general equity principles and to limitations on availability of
equitable relief, including specific performance.
viii) The [Firm] Common Shares to be purchased by the
Underwriters from the Company have been duly authorized for issuance and
sale pursuant to the Underwriting Agreement and, when issued and
delivered by the Company pursuant to the Underwriting Agreement against
payment of the consideration set forth therein, will be validly issued,
fully paid and nonassessable.
ix) [Each of] the Registration Statement [and the Rule 462(b)
Registration Statement, if any,] has been declared effective by the
Commission under the Securities Act of 1933, as amended, including the
rules and regulations promulgated thereunder (collectively, the
"Securities Act"). To the best knowledge of such counsel, no stop order
suspending the effectiveness of [either of] the Registration Statement
[or the Rule 462(b) Registration Statement, if any,] has been issued
under the Securities Act and no proceedings for such purpose have been
instituted or are pending or threatened by the Commission. Any required
filing of the Prospectus [and any supplement thereto] pursuant to Rule
424(b) under the Securities Act has been made in the manner and within
the time period required by such Rule 424(b).
A-2
49
x) The Registration Statement[, including any Rule 462(b)
Registration Statement,] the Prospectus, and each amendment or
supplement to the Registration Statement and the Prospectus, as of their
respective effective or issue dates (other than the financial
statements, notes thereto and related statements, schedules and other
financial and statistical information included therein or in exhibits to
or excluded from the Registration Statement, as to which no opinion need
be rendered) comply as to form in all material respects with the
applicable requirements of the Securities Act.
xi) The Common Shares have been approved for inclusion on the
Nasdaq National Market, subject only to official notice of issuance.
xii) The statements (i) in the Prospectus under the captions
"Management--Board Composition," "Management--Board Committees,"
"Management--Employment Agreement," "Management--Employee Benefit
Plans," "Certain Transactions," "Description of Capital Stock" and
"Shares Eligible for Future Sale" and (ii) in Item 14 of the
Registration Statement, insofar as such statements constitute matters of
law, summaries of legal matters, the Company's certificate of
incorporation or by-law provisions, documents or legal proceedings, or
legal conclusions, has been reviewed by such counsel and fairly
summarize, to the extent required under the Securities Act the matters
referred to therein.
xiii) To the best knowledge of such counsel, there are no legal
or governmental actions, suits or proceedings pending or threatened
which are required, under the Securities Act, to be disclosed in the
Registration Statement, other than those disclosed therein.
xiv) To the best knowledge of such counsel, there are no
Existing Instruments required to be described or referred to in the
Registration Statement or to be filed as exhibits thereto under the
Securities Act other than those described or referred to therein or
filed as exhibits thereto.
xv) No consent, approval, authorization or other order of, or
registration or filing with, any court or other governmental authority
or agency, is required for the Company's execution, delivery and
performance of the Underwriting Agreement and the Company's consummation
of the transactions contemplated thereby and by the Prospectus, except
as required under the Securities Act, applicable state securities or
blue sky laws and the clearance of such offering with the NASD.
xvi) The execution and delivery of the Underwriting Agreement by
the Company and the performance by the Company of its obligations
thereunder (other than performance by the Company of its obligations
under the indemnification and
A-3
50
contribution sections of the Underwriting Agreement, as to which no
opinion need be rendered) (i) have been duly authorized by all necessary
corporate action on the part of the Company; (ii) will not result in any
violation of the provisions of the charter or by-laws of the Company;
(iii) will not constitute a material breach of, or material Default
under or result in the creation or imposition of any material lien,
charge or encumbrance upon any property or assets of the Company under
any material Existing Instrument; or (iv) to the best knowledge of such
counsel, will not result in any violation of any law, administrative
regulation or administrative or court decree applicable to the Company,
which would materially and adversely affect the Company, its assets,
financial condition or operations.
xvii) No persons have registration or other similar rights under
the Company's certificate of incorporation, by-laws or any agreement or
contract, known to such counsel and to which the Company is a party, to
have any equity or debt securities registered for sale under the
Registration Statement or included in the offering contemplated by the
Underwriting Agreement.
xviii) To the best knowledge of such counsel, the Company is not
in violation of its Certificate of Incorporation or by-laws.
In addition, such counsel shall state that they have participated
in conferences with officers and other representatives of the Company,
representatives of the independent public or certified public accountants for
the Company and with representatives of the Underwriters at which the contents
of the Registration Statement and the Prospectus, and any supplements or
amendments thereto, and related matters were discussed and, although such
counsel is not passing upon and does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus (other than as specified in paragraph
above), and any supplements or amendments thereto, on the basis of the
foregoing, nothing has come to their attention which would lead them to believe
that [either] the Registration Statement [or any amendments thereto], at the
time the Registration Statement [or such amendments] became effective, contained
an untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading or that the Prospectus, as of its date or at the First Closing Date
or the Second Closing Date, as the case may be, contained an untrue statement of
a material fact or omitted to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading (it being understood that such counsel need express no
belief as to the financial statements schedules and other financial and
statistical information, included in the Registration Statement or the
Prospectus or any amendments or supplements thereto).
A-4
51
In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction other than the
General Corporation Law of the State of Delaware, the General Corporation Law of
the State of California or the federal law of the United States, to the extent
they deem proper and specified in such opinion, upon the opinion (which shall be
dated the First Closing Date or the Second Closing Date, as the case may be,
shall be satisfactory in form and substance to the Underwriters, shall expressly
state that the Underwriters may rely on such opinion as if it were addressed to
them and shall be furnished to the Representatives) of other counsel of good
standing whom they believe to be reliable and who are satisfactory to counsel
for the Underwriters; provided, however, that such counsel shall further state
that they believe that they and the Underwriters are justified in relying upon
such opinion of other counsel, and (B) as to matters of fact, to the extent they
deem proper, on certificates of responsible officers of the Company and public
officials.
A-5
52
EXHIBIT B-1(2)
Opinion for Individual Selling Stockholders
The opinion of such counsel pursuant to Section shall be rendered
to the Representatives at the request of the Company and shall so state therein.
References to the Prospectus in this Exhibit B-1 include any supplements thereto
at the Closing Date.
i) The Underwriting Agreement has been duly executed and
delivered by or on behalf of, and is a valid and binding agreement of,
each Selling Stockholder, enforceable in accordance with its terms,
except as rights to indemnification and contribution thereunder may be
limited by applicable law and except as the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting creditors' rights generally and
subject to general equity principles and to limitations on availability
of equitable relief, including specific performance.
ii) To the best of such counsel's knowledge, the execution and
delivery by each Selling Stockholder of, and the performance by such
Selling Stockholder of its obligations under, the Underwriting Agreement
and its Custody Agreement and its Power of Attorney will not violate or
contravene any provision of applicable law or regulation (except for
applicable state securities or blue sky laws as to which no opinion need
be expressed).
iii) To the best of such counsel's knowledge, each Selling
Stockholder has record title to all of the Common Shares which may be
sold by such Selling Stockholder under the Underwriting Agreement.
iv) Each of the Custody Agreement and Power of Attorney of each
Selling Stockholder has been executed and delivered by such Selling
Stockholder and is a valid and binding agreement of such Selling
Stockholder, enforceable in accordance with its terms, except as rights
to indemnification and contribution thereunder may be limited by
applicable law and except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting creditors' rights generally and subject to
general equity principles and to limitations on availability of
equitable relief, including specific performance.
v) Assuming that the Underwriters purchase the Common Shares
which are sold by each Selling Stockholder pursuant to
-----------
(2) The final opinion in draft form must be attached as Exhibit B-1 at the time
this Agreement is executed.
B-1-1
53
the Underwriting Agreement for value, in good faith and without notice
of any adverse claim, the delivery of such Common Shares pursuant to the
Underwriting Agreement will pass good and valid title to such Common
Shares, free and clear of any adverse claim.
vi) To the best of such counsel's knowledge, no consent,
approval, authorization or other order of, or registration or filing
with, any court or governmental authority or agency, is required for the
consummation by each Selling Stockholder of the transactions
contemplated in the Underwriting Agreement, except as required under the
Securities Act of 1933, as amended, the rules and regulations
promulgated thereunder, applicable state securities or blue sky laws,
and from the NASD.
In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction other than the
General Corporation Law of the State of Delaware, the General Corporation Law of
the State of California or the federal law of the United States, to the extent
they deem proper and specified in such opinion, upon the opinion (which shall be
dated the First Closing Date shall be satisfactory in form and substance to the
Underwriters, shall expressly state that the Underwriters may rely on such
opinion as if it were addressed to them and shall be furnished to the
Representatives) of other counsel of good standing whom they believe to be
reliable and who are satisfactory to counsel for the Underwriters; provided,
however, that such counsel shall further state that they believe that they and
the Underwriters are justified in relying upon such opinion of other counsel,
and (B) as to matters of fact, to the extent they deem proper, on certificates
of the Selling Stockholders and public officials.
B-1-2
54
EXHIBIT B-2(3)
Opinion for Corporate Selling Stockholders
(to be rendered by such entity's regular counsel
acceptable to the Underwriters)
The opinion of such counsel pursuant to Section shall be rendered
to the Representatives at the request of the Company and shall so state therein.
References to the Prospectus in this Exhibit B-2 include any supplements thereto
at the Closing Date.
i) The Underwriting Agreement has been duly authorized, executed
and delivered by or on behalf of, and is a valid and binding agreement
of, each Selling Stockholder, enforceable in accordance with its terms,
except as rights to indemnification and contribution thereunder may be
limited by applicable law and except as the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting creditors' rights generally and
subject to general equity principles and to limitations on availability
of equitable relief, including specific performance.
ii) The execution and delivery by each Selling Stockholder of,
and the performance by such Selling Stockholder of its obligations
under, the Underwriting Agreement and its Custody Agreement and its
Power of Attorney will not contravene or conflict with, result in a
breach of, or constitute a default under, the charter or by-laws,
partnership agreement, trust agreement or other organizational
documents, as the case may be, of such Selling Stockholder, or, to the
best of such counsel's knowledge, violate or contravene any provision of
applicable law or regulation (except for the Securities Act, applicable
state securities or blue sky laws as to which no opinion need be
expressed), or, to the best of such counsel's knowledge, violate, result
in a breach of or constitute a default under the terms of any other
agreement or instrument to which such Selling Stockholder is a party or
by which it is bound, or any judgment, order or decree applicable to
such Selling Stockholder of any court, regulatory body, administrative
agency, governmental body or arbitrator having jurisdiction over such
Selling Stockholder.
iii) To the best of such counsel's knowledge, each Selling
Stockholder has record title to all of the Common Shares which may be
sold by such Selling Stockholder under the Underwriting Agreement and
has the corporate, partnership or trust right and power, and all
authorizations and approvals required under its charter and by-laws,
partnership
----------
(3) The final opinion in draft form must be attached as Exhibit B-2 at the time
this Agreement is executed.
B-2-1
55
agreement, trust agreement or other organizational documents, as the
case may be, to enter into the Underwriting Agreement and its Custody
Agreement and its Power of Attorney, to sell, transfer and deliver all
of the Common Shares which may sold by such Selling Stockholder under
the Underwriting Agreement and to comply with its other obligations
under the Underwriting Agreement, its Custody Agreement and its Power of
Attorney.
iv) Each of the Custody Agreement and Power of Attorney of each
Selling Stockholder has been duly authorized, executed and delivered by
such Selling Stockholder and is a valid and binding agreement of such
Selling Stockholder, enforceable in accordance with its terms, except as
rights to indemnification and contribution thereunder may be limited by
applicable law and except as the enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting creditors' rights generally and subject to
general equity principles and to limitations on availability of
equitable relief, including specific performance.
v) Assuming that the Underwriters purchase the Common Shares
which are sold by each Selling Stockholder pursuant to the Underwriting
Agreement for value, in good faith and without notice of any adverse
claim, the delivery of such Common Shares pursuant to the Underwriting
Agreement will pass good and valid title to such Common Shares, free and
clear of any adverse claim.
vi) To the best of such counsel's knowledge, no consent,
approval, authorization or other order of, or registration or filing
with, any court or governmental authority or agency, is required for the
consummation by each Selling Stockholder of the transactions
contemplated in the Underwriting Agreement, except as required under the
Securities Act of 1933, as amended, the rules and regulations
promulgated thereunder, applicable state securities or blue sky laws,
and from the NASD.
In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction other than the
General Corporation Law of the State of Delaware, the General Corporation Law of
the [state or commonwealth of the entity's organization] or the federal law of
the United States, to the extent they deem proper and specified in such opinion,
upon the opinion (which shall be dated the First Closing Date shall be
satisfactory in form and substance to the Underwriters, shall expressly state
that the Underwriters may rely on such opinion as if it were addressed to them
and shall be furnished to the Representatives) of other counsel of good standing
whom they believe to be reliable and who are satisfactory to counsel for the
Underwriters; provided, however, that such counsel shall further state that they
believe that they and the Underwriters are justified in relying upon such
opinion of other counsel, and
B-2-2
56
(B) as to matters of fact, to the extent they deem proper, on certificates of
the Selling Stockholders and public officials
B-2-3
57
EXHIBIT C
[Date]
Xxxxxxxxxx Securities
BT Alex. Xxxxx Incorporated
As Representatives of the Several Underwriters
c/x Xxxxxxxxxx Securities
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
RE: Il Fornaio (America) Corporation (the "Company")
Ladies & Gentlemen:
The undersigned is an owner of record or beneficially of certain shares of
Common Stock of the Company ("Common Stock") or securities convertible into or
exchangeable or exercisable for Common Stock. The Company proposes to carry out
a public offering of Common Stock (the "Offering") for which you will act as the
representatives of the underwriters. The undersigned recognizes that the
Offering will be of benefit to the undersigned and will benefit the Company by,
among other things, raising additional capital for its operations. The
undersigned acknowledges that you and the other underwriters are relying on the
representations and agreements of the undersigned contained in this letter in
carrying out the Offering and in entering into underwriting arrangements with
the Company with respect to the Offering.
In consideration of the foregoing, the undersigned hereby agrees that the
undersigned will not, without the prior written consent of Xxxxxxxxxx Securities
(which consent may be withheld at the sole discretion of Xxxxxxxxxx Securities),
directly or indirectly, sell, offer, contract or grant any option to sell
(including without limitation any short sale), pledge, transfer, establish an
open "put equivalent position" within the meaning of Rule 16a-1(h) under the
Securities Exchange Act of 1934, or otherwise dispose of (other than by devise
or descent) any shares of Common Stock, options or warrants to acquire shares of
Common Stock, or securities exchangeable or exercisable for or convertible into
shares of Common Stock currently or hereafter owned either of record or
beneficially (as defined in Rule 13d-3 under Securities Exchange Act of 1934, as
amended) by the undersigned, or publicly announce the undersigned's intention to
do any of the foregoing, for a period commencing on the date hereof and
continuing through the close of trading on the date 180 days after the date of
the Prospectus. The foregoing paragraph shall not prohibit (i) bona fide gifts
made to any person or entity or (ii) distributions by the undersigned to its
partners (if the undersigned is a partnership) or shareholders (if the
undersigned is a corporation); provided that such donee or distributee agrees in
writing to be bound by the provisions of this letter as if it were the
undersigned referred to herein, which written agreement shall have been executed
and delivered to Xxxxxxxxxx Securities prior to
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58
such gift or distribution. The undersigned also agrees and consents to the entry
of stop transfer instructions with the Company's transfer agent and registrar
against the transfer of shares of Common Stock or securities convertible into or
exchangeable or exercisable for Common Stock held by the undersigned except in
compliance with the foregoing restrictions.
With respect to the Offering only, the undersigned waives any registration
rights relating to registration under the Securities Act of 1933, as amended, of
any Common Stock owned either of record or beneficially by the undersigned,
including any rights to receive notice of the Offering.
This agreement is irrevocable and will be binding on the undersigned and the
respective successors, heirs, personal representatives, and assigns of the
undersigned.
_______________________________
Printed Name of Holder
By: ___________________________
Signature
_______________________________
Printed Name of Person Signing (and indicate capacity of person signing if
signing as custodian, trustee, or on behalf of an entity)
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