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EXHIBIT 1.1
2,500,000 SHARES*
XXXXXXXX MICRO SCIENCE INTERNATIONAL, INC.
CLASS A COMMON STOCK
UNDERWRITING AGREEMENT
______________ , 1998
ABN AMRO Incorporated
Xxxxxx X. Xxxxx & Co. Incorporated
As Representatives of the
several Underwriters named
in Schedule I hereto
c/o ABN AMRO Incorporated
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
Subject to the terms and conditions set forth in this Underwriting
Agreement (this "Agreement"), Xxxxxxxx Micro Science International, Inc., a
Delaware corporation (the "Company"), proposes to issue and sell an aggregate of
2,500,000 shares of Class A Common Stock, par value $.01 per share (the "Class A
Common Stock"), of the Company to the several underwriters named in Schedule I
hereto (collectively, the "Underwriters"). The Company also proposes to sell to
the several Underwriters, upon the terms and conditions set forth in Section 2
hereof, up to an additional 375,000 shares of Class A Common Stock. The Class A
Common Stock and the Class B Common Stock, par value $.01 of the Company are
collectively hereinafter referred to as the "Common Stock." The 2,500,000 shares
of Class A Common Stock to be sold by the Company are hereinafter referred to as
the "Firm Shares" and the 375,000 additional shares to be sold by the Company
are hereinafter referred to as the "Additional Shares." The Firm Shares and the
Additional Shares are hereinafter collectively referred to as the "Shares." ABN
AMRO Incorporated and Xxxxxx X. Xxxxx & Co. Incorporated are acting individually
and as representatives of the several Underwriters and in such capacity are
hereinafter referred to as the "Representatives." The Company is currently
wholly-owned by
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* Plus an option to purchase up to 375,000 Additional Shares to cover
over-allotments.
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Xxxxxxxx Laboratories International, Inc. ("GLII"), a subsidiary of Xxxxxxxx
Laboratories, Inc. ("GLI").
Prior to the purchase and public offering of the Shares by the several
Underwriters, the Company and the Representatives shall enter into an agreement
substantially in the form of Exhibit A hereto (the "Pricing Agreement"). The
Pricing Agreement may take the form of an exchange of any standard form of
written telecommunication between the Company and the Representatives and shall
specify such applicable information as is indicated in Exhibit A hereto. The
offering of the Shares will be governed by this Agreement, as supplemented by
the Pricing Agreement. From and after the date of the execution and delivery of
the Pricing Agreement, this Agreement shall be deemed to incorporate the Pricing
Agreement.
The Company is advised by the Representatives that the Underwriters have
agreed to make a public offering of their respective portions of the Shares as
soon after the Registration Statement (as defined below) has become effective
and the Pricing Agreement has been executed as in the judgment of the
Representatives is advisable and to first offer the Shares upon the terms
described in the Prospectus (as defined below).
The Company, GLII, the Representatives and the other Underwriters hereby
agree to the following matters with respect to the purchase and sale of the
Shares:
SECTION 1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND GLII.
(a) The Company represents and warrants to each Underwriter that:
(i) The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "Act"), a registration statement on
Form S-1 (File No. 333-60153), including a preliminary prospectus, relating to
the Shares and one or more amendments thereto. The Company will next file with
the Commission one of the following: (A) prior to effectiveness of such
registration statement, a further amendment thereto, including the form of final
prospectus, (B) a final prospectus in accordance with Rules 430A and 424(b)
under the Act or (C) a term sheet (the "Term Sheet") as described in and in
accordance with Rules 434 and 424(b) under the Act. As filed, the final
prospectus, if one is used, or the Term Sheet and the latest Preliminary
Prospectus, if a final prospectus is not used, shall include all Rule 430A
Information (as defined below). There have been or will promptly be delivered to
you three signed copies of such registration statement and each such amendment,
three copies of each exhibit filed therewith, and conformed copies of such
registration statement and each such amendment (but without exhibits) and of the
related preliminary prospectus or prospectuses and final form of prospectus or
Term Sheet, if a Term Sheet is used, for each of the Underwriters. The term
"Registration Statement" as used in this Agreement shall mean such registration
statement at the time such registration statement becomes effective and, in the
event any post-effective amendment thereto becomes effective prior to the
Closing Date (as defined below), shall also mean such registration statement as
so amended; provided, however, that such term shall also include all Rule 430A
Information (as defined below) deemed to be included in such registration
statement at the time such registration
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statement becomes effective as provided by Rule 430A and, if a Term Sheet is
used, shall also include all information deemed to be included in such
registration statement at the time such registration statement becomes effective
as provided by Rule 434; provided, further, that if the Company files a
registration statement under the Act to register additional shares of Class A
Common Stock and relies on Rule 462(b) for such registration statement to become
effective upon filing with the Commission (the "Rule 462 Registration
Statement"), then any reference to "Registration Statement" herein shall be
deemed to be to both the registration statement referred to above (No.
333-60153) and the Rule 462 Registration Statement, as each such registration
statement may be amended pursuant to the Act. The term "Preliminary Prospectus"
as used in this Agreement shall mean any preliminary prospectus relating to the
Shares filed with the Commission under the Act and the rules and regulations
thereunder, including any preliminary prospectus included in the Registration
Statement at the time it becomes effective that omits Rule 430A Information. The
term "Prospectus" as used in this Agreement shall mean: (X) the prospectus
relating to the Shares in the form in which it is first filed with the
Commission pursuant to Rule 424(b) under the Act; (Y) if a Term Sheet is not
used and no filing pursuant to Rule 424(b) under the Act is required, the form
of final prospectus included in the Registration Statement at the time the
Registration Statement becomes effective; or (Z) if a Term Sheet is used in lieu
of a prospectus, the Term Sheet in the form in which it is first filed with the
Commission pursuant to Rule 424(b) under the Act, together with the latest
Preliminary Prospectus included in the Registration Statement at the time it
becomes effective (such Term Sheet and Preliminary Prospectus are sometimes
collectively referred to herein as the "Rule 434 Prospectus"). The term "Rule
430A Information" as used in this Agreement shall mean information with respect
to the Shares and the offering thereof permitted to be omitted from the
Registration Statement when it becomes effective pursuant to Rule 430A under the
Act. The Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission thereunder are hereinafter collectively referred
to as the "Exchange Act."
(ii) The Commission has not issued any order preventing or suspending the
use of any Preliminary Prospectus, and each Preliminary Prospectus complied in
all material respects when so filed with the requirements of the Act (except to
the extent that, in conformity with the Act, such Preliminary Prospectus is
subject to completion).
(iii) The Registration Statement in the form in which it becomes effective
and also in such form as it may be when the Pricing Agreement is executed or any
post-effective amendment to the Registration Statement shall become effective,
and the Prospectus when and in the form last filed with the Commission as part
of the Registration Statement prior to effectiveness or, if applicable, first
filed pursuant to Rule 424(b) under the Act, and when any supplement or
amendment thereto is filed with the Commission, each will comply in all material
respects with the requirements of the Act and will not at any such time contain
an untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading. This
representation and warranty does not apply to statements in or omissions from
the Registration Statement or the Prospectus (or any supplement or amendment
thereto) made in reliance upon and in conformity with information furnished to
the Company in writing by or on behalf of such Underwriter through the
Representatives specifically for use in the Registration
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Statement, which information solely consists of the disclosure included in the
Prospectus under the caption "Underwriting."
(iv) Subject to the Company's requests for confidential treatment under
Rule 406 of the Act, there is no contract or other document of a character
required to be described in the Registration Statement or Prospectus or to be
filed as an exhibit to the Registration Statement which is not described or
filed as required.
(v) The accountants who have expressed their opinions with respect to
certain of the financial statements of the Company included in the Registration
Statement and the Prospectus, are independent public accountants as required by
the Act.
(vi) The consolidated financial statements, together with the notes
thereto, of the Company included in the Registration Statement and the
Prospectus comply in all material respects with the Act and present fairly the
consolidated financial position of the Company as of the dates indicated, and
the consolidated results of operations and cash flows of the Company for the
periods specified. Such financial statements have been prepared in conformity
with generally accepted accounting principles applied on a consistent basis
throughout the entire period involved except to the extent disclosed therein. No
other financial statements, including pro forma financial statements, or
schedules are required by the Act to be included in the Registration Statement
or the Prospectus.
(vii) The Company and its subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit preparation
of financial statements in conformity with generally accepted accounting
principles and to maintain accountability for assets; and (iii) access to assets
is permitted only in accordance with management's general or specific
authorization, except in any such case in which the failure to maintain such
controls would not have a material adverse effect upon the condition (financial
or otherwise), earnings, business or prospects of the Company and its
subsidiaries, taken as a whole.
(viii) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with full
corporate power and authority to own, lease and operate its properties and
conduct its business as described in the Registration Statement and Prospectus.
The Company is duly qualified to do business as a foreign corporation and in
good standing in each jurisdiction in which the ownership or leasing of its
properties or the conduct of its business requires such qualification, except in
any such case in which the failure to so qualify or be in good standing would
not have a material adverse effect upon the condition (financial or otherwise),
earnings, business or prospects of the Company and its subsidiaries, taken as a
whole; and no proceeding of which the Company has knowledge has been instituted
in any such jurisdiction, revoking, limiting or curtailing, or seeking to
revoke, limit or curtail, such power and authority or qualification.
(ix) The only subsidiaries of the Company are the subsidiaries listed on
Exhibit 21 to the Registration Statement. Each of the Company's subsidiaries has
been duly incorporated and
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is validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, with full corporate power and authority to own,
lease and operate its properties and conduct its business as described in the
Registration Statement and Prospectus. Each of the Company's subsidiaries is
duly qualified to do business as a foreign corporation in good standing in each
jurisdiction in which the ownership or leasing of its properties or the conduct
of its business requires such qualification, except in any such case in which
the failure to so qualify or be in good standing would not have a material
adverse effect on the condition (financial or otherwise), earnings, business or
prospects of the Company and its subsidiaries, taken as a whole; and no
proceeding of which the Company has knowledge has been instituted in any such
jurisdiction, revoking, limiting or curtailing, or seeking to revoke, limit or
curtail, such power and authority or qualification. Except for the capital stock
of the subsidiaries and except as otherwise described in the Prospectus, the
Company does not own any capital stock of, or other securities evidencing an
equity interest in, any corporation, partnership or other entity. All of the
issued and outstanding shares of capital stock of the Company's subsidiaries
have been duly and validly authorized and issued, are fully paid and
non-assessable, and except as described in the Prospectus or the Registration
Statement (including the exhibits thereto) and for directors' or shareholders'
qualifying shares held by nominees of the Company), are owned by the Company,
free and clear of any security interest, claim, lien, encumbrance or adverse
interest of any nature. There are no outstanding subscriptions, rights, warrants
or options to acquire, or instruments convertible into or exchangeable for, any
shares of capital stock of any of the Company's subsidiaries.
(x) The Company has an authorized and outstanding capitalization as
described in the Prospectus and the Shares conform to the description thereof
contained in the Prospectus. All of the issued and outstanding shares of Common
Stock have been duly authorized, validly issued and are fully paid and
non-assessable and free of preemptive or other similar rights and there are no
options, agreements, contracts or other rights in existence to acquire from the
Company any shares of Common Stock, except as described in the Prospectus.
(xi) The Shares to be sold by the Company pursuant to this Agreement and
the Pricing Agreement have been duly authorized and, when issued and paid for in
accordance with this Agreement and the Pricing Agreement, will be validly
issued, fully paid and non-assessable; the holders of the Shares will not be
subject to personal liability by reason of being such holders; there are no
holders of securities of the Company having rights, contractual or otherwise, to
registration thereof or preemptive rights to purchase Common Stock except
pursuant to the terms of the Shareholder Agreement dated as of ___________, 1998
by and between the Company and GLII; all corporate actions required to be taken
for the authorization, issue and sale of the Shares have been validly and
sufficiently taken; and upon delivery of and payment for such Shares hereunder,
the Underwriters will acquire valid and marketable title thereto, free and clear
of any security interest, claim, lien, encumbrance or adverse interest of any
nature.
(xii) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, except as otherwise stated or
contemplated therein, there has not been (A) any material adverse change in the
condition (financial or otherwise), earnings, business or prospects of the
Company and its subsidiaries, taken as a whole, whether or not arising in the
ordinary course of business, (B) any material transaction entered into, or any
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material liability or obligation incurred, by the Company or its subsidiaries
other than in the ordinary course of business, (C) any change in the capital
stock, or material increase in the long-term debt of the Company or its
subsidiaries, or (D) any dividend or distribution of any kind declared, paid or
made by the Company on its capital stock.
(xiii) The Company and each of its subsidiaries have good and marketable
title to all properties and assets reflected as owned in the financial
statements hereinabove described or described in the Prospectus as owned by
them, free and clear of all liens, charges, encumbrances or restrictions of any
kind, except such as are referred to in such financial statements or elsewhere
in the Prospectus or which are not material to the business of the Company and
its subsidiaries, taken as a whole; all of the leases and subleases material to
the business of the Company and its subsidiaries, taken as a whole or under
which the Company or any of its subsidiaries holds properties are in full force
and effect; and neither the Company nor any of its subsidiaries has received any
notice of any material claim of any sort which has been asserted by anyone
adverse to the rights of the Company or any subsidiary as owner or as lessee or
sublessee under any of the leases or subleases mentioned above, or affecting or
questioning the rights of the Company or such subsidiary to the continued
possession of the leased or subleased premises under any such lease or sublease.
(xiv) Neither the Company nor any of its subsidiaries is in default in the
observance of any provision of its Certificate of Incorporation (or other
charter or organizational documents) or by-laws (or other governing documents),
or in the performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, loan agreement, note,
lease or other instrument to which it is a party or by which it or any of its
properties may be bound, the effect of which could be materially adverse to the
condition (financial or otherwise), earnings, business or prospects of the
Company and its subsidiaries, taken as a whole.
(xv) The execution and delivery of this Agreement and the Pricing
Agreement, the issuance and delivery of the Shares, the application of the net
proceeds from the offering in the manner described in the Prospectus under "Use
of Proceeds," the consummation of the transactions contemplated herein and in
the Registration Statement and compliance with the terms of this Agreement and
the Pricing Agreement have been duly authorized by all necessary corporate
action and will not result in any violation of the Certificate of Incorporation
(or other charter or organizational documents) or by-laws (or other governing
documents) of the Company or any of its subsidiaries, and will not conflict with
or result in a breach of any of the terms or provisions of, or constitute a
default under, or result in the creation or imposition of any lien, charge,
encumbrance or restriction of any kind upon any property or assets of the
Company or any of its subsidiaries under any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument to which the Company or
any of its subsidiaries is a party or by which the Company or any of its
subsidiaries, or any of their respective properties, is bound, or any existing
applicable law, rule, regulation, judgment, order or decree of any government,
governmental instrumentality or court, domestic or foreign, having jurisdiction
over the Company or any of its subsidiaries or any of their respective
properties. No approval, authorization or consent of any court, regulatory body,
administrative agency or other governmental body having jurisdiction over the
Company or any of its subsidiaries is required in
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connection with the sale of the Shares to the Underwriters, except such as may
be required under the Act, state securities or Blue Sky laws or from the
clearance of the offering with the National Association of Securities Dealers,
Inc. (the "NASD").
(xvi) Except as disclosed in the Registration Statement and the
Prospectus, there is no action, suit or proceeding before or by any court or
governmental agency or body, domestic or foreign, or any arbitrator or
arbitration panel, now pending or, to the knowledge of the Company, threatened
against or affecting the Company or any of its subsidiaries which could result
in any material adverse change to the condition (financial or otherwise),
earnings, business or prospects of the Company and its subsidiaries, taken as
whole; and there is no decree, judgment or order of any kind in existence
against or restraining the Company or any of its subsidiaries, or any of their
respective officers, employees or directors, from taking any actions of any kind
in connection with the business of the Company or any such subsidiary.
(xvii) The Company and each of its subsidiaries own or possess or have
obtained all licenses, permits, consents, orders, approvals and other
authorizations necessary to lease or own, as the case may be, and to operate
their respective properties and to carry on their respective businesses as
presently conducted, except where the failure to own or possess any such
license, permit, consent, order, approval or other authorization would not have
a material adverse effect on the condition (financial or otherwise), earnings,
business or prospects of the Company and its subsidiaries, taken as whole, and
neither the Company nor any such subsidiary has received any notice of
proceedings related to revocation or modification of any such licenses, permits,
consents, orders, approvals or authorizations which singly or in the aggregate,
if the subject of an unfavorable ruling or finding, would be materially adverse
to the condition (financial or otherwise), earnings, business or prospects of
the Company and its subsidiaries, taken as a whole.
(xviii) The conduct of the business of the Company and each of its
subsidiaries is in compliance with all applicable federal, state, local and
foreign laws and regulations that regulate or are concerned in any way with the
business of the Company or such subsidiaries, where the effect of the failure to
comply would be materially adverse to the condition (financial or otherwise),
earnings, business or prospects of the Company and its subsidiaries, taken as a
whole.
(xix) Except as disclosed in the Registration Statement and the
Prospectus, the Company together with its subsidiaries owns or possesses,
or can acquire on reasonable terms, all intellectual property, including
without limitation all right, title and interest in or to, or has duly licensed
from third parties, all patents, trademarks, service marks, copyrights, trade
names, trade secrets and other proprietary rights ("Trade Rights") necessary to
conduct the business now or proposed to be conducted by it, and neither the
Company nor any of its subsidiaries nor GLII has received any notice of, and
has no knowledge of, infringement of or conflict with asserted rights of others
with respect to any such Trade Rights which, singly or in the aggregate, if the
subject of any unfavorable decision, ruling or finding, would be materially
adverse to the condition (financial or otherwise), earnings, business or
prospects of the Company and its subsidiaries, taken as a whole.
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(xx) The Company and all of its subsidiaries have timely filed (or have
timely requested an extension of the time to file) all federal, state, local and
foreign tax returns required to be filed, or have been included in a
consolidated return filed by GLI with respect to such required filings, and have
paid all taxes which were payable pursuant to said returns or any assessments
with respect thereto, other than any taxes which the Company, any of its
subsidiaries or GLI is contesting in good faith or which are not material to the
Company and its subsidiaries, taken as a whole, and there is no tax deficiency
that has been, or to the knowledge of the Company might be, asserted against the
Company or any of its subsidiaries or the properties or assets of the Company or
any such subsidiary that would or could be expected to have a material adverse
affect upon the condition (financial or otherwise) or results of operations of
the Company and its subsidiaries, taken as a whole.
(xxi) This Agreement has been duly authorized, executed and delivered by
the Company; the Pricing Agreement, upon execution and delivery by the Company,
shall be duly authorized, executed and delivered by the Company; and this
Agreement constitutes, and when executed the Pricing Agreement shall constitute,
valid and binding obligations of the Company.
(xxii) The Company has filed a registration statement on Form 8-A to
register the Common Stock under Section 12(g) of the Exchange Act and has
requested that such registration statement be declared effective concurrent with
the effectiveness of the Registration Statement. The Company has filed an
application to list the Shares on The Nasdaq National Market and has received
notification that the listing has been approved, subject to notice of issuance
or sale of the Shares, as the case may be.
(xxiii) The Company is not, and does not intend to conduct its business in
a manner in which it would become, an "investment company" as defined in Section
3(a) of the Investment Company Act of 1940, as amended (the "Investment Company
Act").
(xxiv) All offers and sales of the Company's capital stock prior to the
date hereof were at all relevant times exempt from the registration requirements
of the Act and were duly registered with, or the subject of an available
exemption from, the registration requirements of the applicable state securities
or Blue Sky laws.
(xxv) No holder of securities of the Company has rights to the
registration of any securities of the Company because of the filing of the
Registration Statement.
(xxvi) The Company has not taken and will not take, directly or
indirectly, any action designed to cause or result in, or that has
constituted or might reasonably be expected to constitute, the stabilization or
manipulation of the price of any security of the Company.
(xxvii) Except as disclosed in the Registration Statement and the
Prospectus, no transaction has occurred between or among the Company, on the one
hand, and any of its officers or directors or any affiliate or affiliates (as
defined under Rule 12b-2 of the Exchange Act) of any such officer or director,
on the other hand, that is required to be so disclosed, including, but not
limited to, any outstanding loans, advances or guaranties of indebtedness by
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the Company to or for the benefit of any affiliates of the Company, or any of
the officers or directors of the Company, or any family member of any of them.
(xxviii) The Company has not, directly or indirectly, at any time (A) made
any contributions to any candidate for foreign political office, or if made,
failed to disclose fully any such contribution made in violation of law, or (B)
made any payment to any state, federal or foreign governmental officer or
official, or other person charged with similar public or quasi-public duties,
other than payments or contributions required or allowed by applicable law.
(xxix) Except as disclosed in the Registration Statement and the
Prospectus, the Company and its subsidiaries are in compliance in all material
respects with all applicable Environmental, Health and Safety Requirements and
Radiological Health and Safety Requirements (each as hereinafter defined),
except where any such noncompliance, either individually or in the aggregate,
would not have a material adverse effect on the condition (financial or
otherwise), earnings, business or prospects of the Company and its subsidiaries,
taken as a whole. As used herein, (1) "Environmental, Health and Safety
Requirements" means all applicable foreign, federal, state and local laws and
regulations and non-governmental requirements relating to Hazardous Materials
(as hereinafter defined) and the protection of human health, safety, and the
environment, or imposing liability or standards of conduct concerning the
operation of the Company's business, including without limitation, requirements
administered, imposed, or enforced by the U.S. Environmental Protection Agency,
the U.S. Food and Drug Administration, or the U.S. Department of Agriculture,
any corresponding or delegated state agency, any equivalent foreign regulatory
agency and any non-governmental organization from which the Company or its
subsidiaries have applied for or obtained formal certification or registration,
which requirements govern the use and operation of the Company's processes,
facilities and equipment; (2) "Hazardous Material" includes without limitation
(A) ethylene oxide and any other sterilant used by the Company or any of its
subsidiaries, (B) any "hazardous substance" as defined by the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended, (C)
any "hazardous waste" as defined by the Resource Conservation and Recovery Act,
as amended, (D) any petroleum or petroleum product, (E) any polychlorinated
biphenyl, (F) any pollutant or contaminant or hazardous, dangerous, or toxic
chemical, material, waste or substance regulated under or within the meaning of
any other Environmental, Health and Safety Requirement, and (G) radioactive or
radiological material, substance, waste, or by-product; and (3) "Radiological
Health and Safety Requirements" include without limitation requirements
administered, imposed or enforced by the U.S. Nuclear Regulatory Commission
("NRC") or any corresponding or delegated state agency (the "Agreement States"),
or equivalent foreign regulatory agency which requirements govern the use and
operation of the Company's processes, facilities and equipment.
(xxx) Except as described in the Registration Statement and the
Prospectus, since October 1, 1992, neither the Company nor its subsidiaries has
received any notice or other communication alleging that any of them is not in
compliance with any Environmental, Health and Safety Requirement or any
Radiological Health and Safety Requirement, except where any such noncompliance
would not, singly or in the aggregate, have a material adverse effect on the
condition (financial or otherwise), earnings, business or prospects of the
Company and its subsidiaries, taken as a whole. Since October 1, 1992, neither
the Company nor its subsidiaries
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has unlawfully generated, manufactured, produced, transported, imported, used,
treated, refined, processed, handled, stored, discharged, released, or disposed
of any quantity of Hazardous Material (a "release") at, on, under, from, or in
the vicinity of any site owned, leased, occupied, or controlled by the Company
or its subsidiaries, except for any releases which were promptly reported to the
applicable foreign, federal, state or local regulatory body or authority (if
such report is required), and which would not, singly or in the aggregate, have
a material adverse effect on the condition (financial or otherwise), earnings,
business or prospects of the Company and its subsidiaries, taken as a whole.
(xxxi) To the Company's knowledge, except as described in the
Registration Statement and the Prospectus, there are no costs or liabilities
associated with or arising in connection with Environmental, Health and Safety
Requirements or Radiological Health and Safety Requirements as currently in
effect or proposed (including, without limitation, costs of compliance
therewith) which would, singly or in the aggregate have a material adverse
effect on the condition (financial or otherwise), earnings, business or
prospects of the Company and its subsidiaries, taken as a whole. Except as
described in the Registration Statement and the Prospectus, the Company is not
aware of any circumstances that may prevent or interfere with the Company and
its subsidiaries' compliance with any material Environmental, Health and Safety
Law or Radiological Health and Safety Requirement.
(xxxii) The Company and each of its subsidiaries maintains or has the
benefit of insurance with respect to its properties and business of the types
and in amounts that the Company believes are reasonably adequate for its
business, all of which insurance is in full force and effect.
(xxxiii) With respect to each employee benefit plan, program and
arrangement (including, without limitation, any "employee benefit plan" as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA")) maintained or contributed to by the Company, or with
respect to which the Company could incur any liability under ERISA
(collectively, the "Benefit Plans"), no event has occurred and, to the knowledge
of the Company, there exists no condition or set of circumstances, in connection
with which the Company could be subject to any liability under the terms of such
Benefit Plan, applicable law (including, without limitation, ERISA and the
Internal Revenue Code of 1986, as amended) or any applicable agreement that
would reasonably be expected to materially adversely affect the condition
(financial or otherwise), earnings, business or prospects of the Company and its
subsidiaries, taken as a whole.
(b) GLII represents and warrants to each Underwriter that:
(i) The Registration Statement in the form in which it becomes
effective and also in such form as it may be when the Pricing Agreement is
executed or any post-effective amendment to the Registration Statement shall
become effective, and the Prospectus when and in the form last filed with the
Commission as part of the Registration Statement prior to effectiveness or, if
applicable, first filed pursuant to Rule 424(b) under the Act, and when any
supplement or amendment thereto is filed with the Commission, each will comply
in all material respects with the requirements of the Act and will not at any
such time contain an untrue statement of a
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material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. This representation and warranty does not
apply to statements in or omissions from the Registration Statement or the
Prospectus (or any supplement or amendment thereto) made in reliance upon and in
conformity with information relating to any Underwriter furnished to the Company
in writing by or on behalf of such Underwriter through the Representatives
specifically for use in the Registration Statement.
(ii) GLII has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with full
corporate power and authority to own, lease and operate its properties and
conduct its business.
(iii) The execution and delivery of this Agreement and compliance with the
terms of this Agreement by GLII have been duly authorized by all necessary
corporate action, will not result in any violation of the charter or by-laws of
GLII, and will not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, or result in the creation or
imposition of any lien, charge, encumbrance or restriction of any kind upon any
property or assets of GLII under any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument to which it is a party
or by which it or any of its properties is bound, except for such restrictions
which would not have a material adverse effect on the financial condition of
GLII and its subsidiaries, taken as a whole. No approval, authorization or
consent of any court, regulatory body, administrative agency or other
governmental body having jurisdiction over GLII or any of its subsidiaries is
required in connection with the execution and performance of this Agreement by
GLII.
(iv) This Agreement has been duly authorized, executed and delivered by
GLII and constitutes a valid and binding obligation of GLII.
SECTION 2. AGREEMENT TO SELL AND PURCHASE.
(a) Subject to such adjustments to eliminate any fractional share sales
or purchases as the Representatives in their discretion may make, (i) the
Company hereby agrees to issue and sell to the Underwriters an aggregate of
2,500,000 Firm Shares, and (ii) on the basis of the representations, warranties
and agreements of the Company and GLII herein contained and subject to the terms
and conditions set forth herein, each Underwriter agrees, severally and not
jointly, to purchase from the Company, at the purchase price per Share set forth
in the Pricing Agreement (the "Purchase Price per Share"), the number of Firm
Shares set forth opposite the name of such Underwriter in Schedule I hereto (or
such number of Firm Shares as such Underwriter shall be obligated to purchase
pursuant to the provisions of Section 9 hereof).
(b) The Company agrees to sell to the Underwriters and, on the basis
of the representations, warranties and agreements of the Company and GLII set
forth herein and subject to the terms and conditions set forth herein, the
Underwriters shall have the right to purchase, severally and not jointly, from
the Company up to 375,000 Additional Shares, at the Purchase Price per Share
upon delivery to the Company of the notice hereinafter referred to. Such
Additional Shares may be purchased solely for the purpose of covering
over-allotments made in
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connection with the offering of the Firm Shares. If any Additional Shares are to
be purchased, each Underwriter, severally and not jointly, agrees to purchase
from the Company the number of Additional Shares (subject to such adjustments to
eliminate fractional Shares as the Representatives may determine) which bears
the same proportion to the total number of Additional Shares to be purchased
from the Company as the number of Firm Shares set forth opposite such
Underwriter's name in Schedule I (or such number of Firm Shares increased
pursuant to the terms set forth in Section 9 hereof) bears to the total number
of Firm Shares.
SECTION 3. DELIVERY OF THE SHARES AND PAYMENT THEREFOR.
(a) Delivery to the Underwriters of the Firm Shares shall be made in
book-entry form through the facilities of the Depository Trust Company ("DTC")
against payment therefor by wire or other immediately available funds at 9:00
a.m., Chicago, Illinois time, on the third full business day following the date
of the Pricing Agreement (the "Closing Date"). The closing shall take place at
the offices of Lord, Bissell & Brook, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxx. The place of the closing and the Closing Date may be varied by
agreement among the Representatives and the Company.
(b) Delivery to the Underwriters of any Additional Shares to be purchased
by the several Underwriters shall be made in book-entry form through the
facilities of DTC against payment therefor by wire or other immediately
available funds at such time on such date (the "Option Closing Date"), which may
be the same as the Closing Date, but shall in no event be earlier than the
Closing Date nor earlier than three nor later than ten business days after the
giving of the notice hereinafter referred to, as shall be specified in written
notice from the Representatives to the Company of the determination to purchase
a number, specified in said notice, of Additional Shares. Said notice may be
given at any time on or before 30 days after the date of the execution of the
Pricing Agreement. The option closing shall take place at the offices of Lord,
Bissell & Brook, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx. The place of the
closing and the Option Closing Date may be varied by agreement between the
Representatives and the Company.
(c) If the Representatives and the Company have elected to enter into the
Pricing Agreement after the Registration Statement is effective, the Purchase
Price per Share to be paid by the several Underwriters for the Shares shall be
an amount equal to the initial public offering price, less an amount to be
determined by agreement between the Representatives and the Company. The initial
public offering price per share of the Shares shall be a fixed price to be
determined by agreement between the Representatives and the Company. The initial
public offering price and the Purchase Price per Share, when so determined,
shall be set forth in the Pricing Agreement. If such prices have not been agreed
upon and the Pricing Agreement has not been executed and delivered by all
parties thereto by the close of business on the fourth business day following
the date of this Agreement, this Agreement shall terminate forthwith, without
liability of any party to any other party, unless otherwise agreed to by the
Company and the Representatives and except as otherwise provided in Section 5
hereof. If the Representatives and the Company have elected to enter into the
Pricing Agreement prior to the Registration Statement becoming effective, the
initial public offering price and the Purchase Price per Share to be paid by the
several Underwriters for the Shares having each been determined and set forth
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in the Pricing Agreement, the Company agrees to file an amendment to the
Registration Statement and the Prospectus before the Registration Statement
becomes effective.
(d) Unless the Representatives request otherwise, the Firm Shares shall be
delivered in global form and shall be deposited with, or on behalf of, DTC and
registered in the name of DTC's nominee. If at the request of the
Representatives the Firm Shares or the Additional Shares are delivered in
definitive form, certificates for such Shares shall be registered in such names
and in such denominations as the Representatives shall request upon at least 48
hours prior notice to the Company preceding the Closing Date or the Option
Closing Date, as the case may be. Such certificates shall be made available to
the Representatives at the office of the Representatives set forth in Section 12
hereof for inspection and packaging not later than at least 24 hours prior to
the Closing Date or the Option Closing Date, as the case may be.
(e) The Firm Shares and the Additional Shares shall be delivered to the
Representatives on the Closing Date or the Option Closing Date, as the case may
be, with any transfer taxes thereon duly paid by the Company for the respective
accounts of the several Underwriters, against payment of the purchase price
therefor by wire or other immediately available funds. It is understood by the
Company that each of the Underwriters has authorized the Representatives, for
its account, to accept delivery of, receipt for and make payment of the purchase
price for, the Shares it has agreed to purchase.
SECTION 4. AGREEMENTS OF THE COMPANY AND GLII.
(a) The Company covenants and agrees with the several Underwriters that:
(i) The Company will endeavor to cause the Registration
Statement to become effective and will advise the Representatives promptly and,
if requested by the Representatives, will confirm such advice in writing, (A)
when the Registration Statement has become effective and when any post-effective
amendment to it becomes effective, and of the filing of any final prospectus or
supplement or amendment to the Prospectus, (B) of any request by the Commission
for amendments or supplements to the Registration Statement or Prospectus or any
Preliminary Prospectus or for additional information, (C) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or of the suspension of qualification of the Shares for offering or
sale in any jurisdiction, or the initiation or contemplation of any proceeding
for such purposes, and (D) within the period of time referred to in paragraph
(f) below, of the happening of any event which makes any statement made in the
Registration Statement or Prospectus (as then amended or supplemented) untrue in
any material respect or which requires the making of any additions to or changes
in the Registration Statement or Prospectus (as then amended or supplemented) in
order to make the statements therein not misleading or the necessity to amend or
supplement the Prospectus to comply with the Act or any other law. If at any
time the Commission shall issue any stop order suspending the effectiveness of
the Registration Statement, the Company will make every reasonable effort to
obtain the withdrawal of such order at the earliest possible moment. If the
Company elects to rely on Rule 434 of the Act, the Company will prepare a Term
Sheet that complies with the requirements of Rule 434 of the Act and will
provide the Representatives with copies of the form of Rule 434 Prospectus in
such numbers as you may reasonably request and file or transmit for
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filing with the Commission the form of Prospectus complying with Rule 434(c)(2)
of the Act in accordance with Rule 424(b) of the Act by the close of business in
Chicago on the business day immediately succeeding the date hereof. If the
Company elects not to rely on Rule 434, the Company will provide you with copies
of the form of Prospectus in such numbers as you may reasonably request and file
or transmit for filing with the Commission such Prospectus in accordance with
Rule 424(b) of the Act, by the close of business in Chicago on the business day
immediately succeeding the date hereof.
(ii) If, at the time that the Registration Statement becomes effective,
any information shall have been omitted therefrom in reliance upon Rule 430A
under the Act, then promptly following the execution of the Pricing Agreement,
the Company will prepare and file with the Commission, in accordance with Rule
430A and Rule 424(b) under the Act, copies of an amended Prospectus, or, if
required by Rule 430A, a post-effective amendment to the Registration Statement
(including an amended Prospectus) containing all information so omitted.
(iii) Neither the Company nor any of its subsidiaries will, prior to the
earlier of the Option Closing Date or termination or expiration of the related
option, incur any liability or obligation, direct or contingent, or enter into
any material transaction, other than in the ordinary course of business, except
as contemplated in the Registration Statement and the Prospectus.
(iv) The Company will not file any amendment to the Registration
Statement or make any amendment or supplement to the Prospectus of which the
Representatives shall not previously have been advised or to which the
Representatives shall promptly after being so advised reasonably object in
writing.
(v) Prior to the effective date of the Registration Statement, the
Company has delivered or will deliver to each of the Underwriters, without
charge, copies of each form of Preliminary Prospectus in such quantities as they
have reasonably requested or may hereafter reasonably request. The Company
consents to the use, in accordance with the provisions of the Act and with the
securities or Blue Sky laws of the jurisdictions in which the Shares are offered
by the several Underwriters and by dealers, prior to the effective date of the
Registration Statement, of each Preliminary Prospectus so furnished by the
Company.
(vi) On the effective date of the Registration Statement and thereafter
from time to time during such period as in the opinion of counsel for the
Underwriters a prospectus relating to the Shares is required by law to be
delivered in connection with offers or sales of the Shares by an Underwriter or
a dealer, the Company will deliver to each Underwriter and dealer, without
charge, as many copies of the Registration Statement, the Prospectus and each
Preliminary Prospectus (and of any amendment or supplement to such documents) as
they may reasonably request. During such period, if any event occurs which in
the judgment of the Company, or in the opinion of counsel for the Underwriters,
should be described in the Prospectus in order to ensure that no part of the
Prospectus includes an untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances at the time the Prospectus is delivered to a purchaser, not
misleading, the Company will forthwith prepare, submit to the Representatives,
file with the Commission and deliver, without charge to the several Underwriters
and dealers (whose names and addresses will
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be furnished by the Representatives to the Company) to whom shares have been
sold by the Underwriters or to other dealers any amendments or supplements to
the Prospectus so that the statements in the Prospectus, as so amended or
supplemented, will comply with the standards set forth in this sentence. The
Company consents to the use of such Prospectus (and of any amendments or
supplements thereto) in accordance with the provisions of the Act and with the
securities or Blue Sky laws of the jurisdictions described in the preliminary
Blue Sky memorandum in which the Shares are lawfully offered by the several
Underwriters and by all dealers to whom Shares may be sold, both in connection
with the offering or sale of the Shares and for such period of time thereafter
as the Prospectus is required by law to be delivered in connection therewith. In
case any Underwriter is required to deliver a Prospectus (and any amendment or
supplement thereto) more than nine months after the first date upon which the
Shares are offered to the public, the Company will, upon request, but at the
expense of such Underwriter, promptly prepare and furnish such Underwriter with
reasonable quantities of a Prospectus complying with Section 10(a)(3) of the
Act.
(vii) The Company will cooperate with the Representatives and counsel for
the Underwriters in connection with the registration or qualification of the
Shares for offer and sale by the several Underwriters and by dealers under the
securities or Blue Sky laws of such jurisdictions as the Representatives may
designate, will continue such registrations or qualifications in effect so long
as reasonably required for the distribution of the Shares and will file such
consents to service of process or other documents as may be necessary in order
to effect such registration or qualification; provided that in no event shall
the Company be obligated (i) to qualify to do business in any jurisdiction where
it is not now so qualified, (ii) to file any general consent to service of
process, or (iii) take any action that would subject it to income taxation in
any jurisdiction where it is not so qualified.
(viii) For a period of three years after the date of the Pricing Agreement:
(A) the Company will furnish to the Representatives (i)
as soon as available, a copy of each report of the Company of general
interest mailed to any class of its security holders (ii) copies of all
annual reports and current reports filed with the Commission on Forms 10-K,
10-Q and 8-K and any amendment thereto or such other similar forms as may
be designated by the Commission and (iii) from time to time, such other
information concerning the Company as the Representatives may reasonably
request;
(B) if at any time during such three year period, the
Company shall cease filing with the Commission the annual reports and
current reports on Forms 10-K, 10-Q and 8-K or other similar forms referred
to in clause (A) above, the Company will forward to its stockholders
generally and the Representatives and upon request to each of the other
Underwriters (i) as soon as practicable after the end of each fiscal year,
copies of a balance sheet and statements of income and retained earnings of
the Company as of the end of and for such fiscal year, certified by
independent public accountants, and (ii) as soon as practicable after the
end of each quarterly fiscal period, except for the last quarterly fiscal
period in each fiscal year, a summary statement (which need not be
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certified) of income and retained earnings of the Company for such period,
which shall also be made publicly available; and
(C) the Company will furnish to the Representatives and
to the NASD, and by issuance of a press release, on the date of
declaration, notice of all dividends, including the amount and medium of
payment, the record date (which shall be not less than ten days subsequent
to the declaration date) and the payment date (which shall be not less than
ten days subsequent to the record date).
(ix) The Company will make generally available to its security holders an
earnings statement of the Company, which need not be audited, covering a
twelve-month period commencing after the effective date of the Registration
Statement and ending not later than 15 months thereafter, as soon as practicable
after the end of such period, which earnings statement shall satisfy the
provisions of Section 11(a) of the Act and the rules and regulations of the
Commission thereunder (including Rule 158).
(x) The Company will not register for sale, sell, offer, contract to
sell, grant an option for sale, pledge or otherwise dispose of or transfer any
Common Stock or any securities convertible into or exchangeable or exercisable
for Common Stock for a period of 180 days after the date of the Pricing
Agreement without the prior written consent of the Representatives, except (i)
issuances of securities pursuant to the exercise of stock options granted
pursuant to the terms of an incentive plan in effect on the date hereof, and
(ii) issuances of securities as consideration in connection with acquisitions
(provided the recipient agrees not to sell, offer, contract to sell, grant an
option for sale or otherwise dispose of or transfer any Common Stock or any
securities convertible into or exchangeable or exercisable for Common Stock
during the remainder of the 180 day period described herein). The Company will
also obtain similar agreements from each of its executive officers and
directors.
(xi) The Company will apply the net proceeds from the sale of the shares
to be sold by it under this Agreement and the Pricing Agreement for the purposes
set forth in the Prospectus under the caption "Use of Proceeds."
(xii) The Company will use its best efforts to cause the Shares to be
approved for listing on the Nasdaq Stock Market, subject to notice of issuance
or sale.
(b) GLII covenants and agrees with the several Underwriters that GLII
will not register for sale, sell, offer, contract to sell, grant an option for
sale, pledge or otherwise dispose of or transfer any Common Stock or any
securities convertible into or exchangeable or exercisable for Common Stock for
a period of 180 days after the date of the Pricing Agreement without the prior
written consent of the Representatives. GLII will also obtain similar agreements
from each of its executive officers and directors who has not already executed
such an agreement and who owns shares of Common Stock or rights to acquire
Common Stock.
SECTION 5. PAYMENT OF EXPENSES. The Company will pay, or reimburse if paid
by the Representatives, whether or not the transactions contemplated hereby are
consummated or this Agreement is terminated, all costs and expenses incident to
the performance by it of its
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obligations under this Agreement and the Pricing Agreement, including, without
limiting the generality of the foregoing, (a) preparation, printing, filing and
distribution (including postage, air freight charges and charges for counting
and packaging) of the original registration statement, the Registration
Statement, each Preliminary Prospectus, the Prospectus (including any exhibits
and financial statements and any Term Sheet delivered by the Company pursuant to
Rule 434 of the Act), each amendment and/or supplement to any of the foregoing,
and this Agreement, the Pricing Agreement, the Agreement Among Underwriters,
Selected Dealers Agreement, Powers of Attorney and Underwriters' Powers of
Attorney and Questionnaires, (b) furnishing to the several Underwriters and
dealers copies of the foregoing materials (provided, however, that any such
copies furnished by the Company more than nine months after the first date upon
which the Shares are offered to the public shall be at the expense of the
several Underwriters or dealers so requesting as provided in Section 4(a)(vi)
above), (c) the registrations or qualifications referred to in Section 4(a)(vii)
above (including filing fees and fees and disbursements of counsel in connection
therewith) and expenses of printing and delivering to the several Underwriters
copies of the preliminary and final Blue Sky memoranda, (d) the review of the
terms of the public offering of the Shares by the NASD (including the filing
fees paid to the NASD in connection therewith) and the reasonable fees and
disbursements of counsel for the Underwriters in connection therewith, (e) the
performance by the Company of its other obligations under this Agreement,
including the fees of the Company's counsel and accountants, (f) the issuance of
the Shares and the preparation and printing of the stock certificates
representing the Shares, including any stamp taxes payable in connection with
the original issuance of the Shares (but not including any such taxes payable in
connection with the resale of the Shares by the Underwriters), (g) furnishing to
the several Underwriters copies of all reports and information required by
Section 4(a)(viii) above, including reasonable costs of shipping and mailing,
and (h) the listing of the Common Stock on the Nasdaq National Market. It is
understood, however, that except as otherwise provided in this Section and
Section 11, the Underwriters will pay all of their own costs and expenses,
including the fees and expenses of their counsel, and any advertising expenses
connected with any offers they may make.
SECTION 6. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS. The several
obligations of the Underwriters to purchase the Firm Shares hereunder are
subject to the following conditions:
(a) The Registration Statement shall have become effective not later than
1:00 p.m., Chicago time, on the first full business day after the date of this
Agreement, or at such later date and time as shall be consented to in writing by
the Representatives, and, if the Representatives and the Company have elected to
rely upon Rule 430A, the price of the Shares and any price-related or other
information previously omitted from the effective Registration Statement
pursuant to such Rule 430A shall have been transmitted to the Commission for
filing pursuant to Rule 424(b) within the prescribed time period, and, if the
Representatives and the Company have elected to rely upon a Term Sheet, such
Term Sheet shall have been transmitted to the Commission for filing pursuant to
Rule 434 and Rule 424(b) within the prescribed time period, and on or prior to
the Closing Date, the Company shall have provided evidence satisfactory to the
Representatives of such timely filing, or a post-effective amendment providing
such information shall have been promptly filed and declared effective in
accordance with the requirements of Rule 430A. No stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for such purpose shall have been instituted
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or shall be pending or, to the knowledge of the Company, shall be contemplated
by the Commission and there shall not have come to the attention of the
Representatives any facts that would cause them to believe that the Prospectus,
at the time it was required to be delivered to purchasers of the Shares,
contained any untrue statement of material fact or omitted to state any material
fact necessary in order to make the statements therein, in light of the
circumstances under which there were made, not misleading.
(b) Subsequent to the effective date of the Registration Statement,
(i) there shall not have occurred any change, or any development involving a
prospective change, in or affecting particularly the business or properties of
the Company or its subsidiaries not contemplated by the Prospectus, which, in
the judgment of the Representatives, would materially adversely affect the
market for the Shares so as to make it impracticable or inadvisable to proceed
with the offering or the delivery of the Shares, as contemplated herein and in
the Prospectus, or to enforce contracts for the purchase of Shares, and (ii) the
business and operations of the Company and its subsidiaries, taken as a whole,
shall not have been materially and adversely affected by strike, fire, flood,
accident or other calamity (whether or not insured).
(c) The Representatives shall have received from Xxxx, Xxxx & Xxxxx,
counsel for the Company, a favorable opinion dated the Closing Date and
satisfactory to the Representatives and the Underwriters' counsel to the effect
that:
(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, with full corporate power and authority to own, lease and
operate its properties and conduct its business as described in the
Prospectus. The Company is duly qualified to do business as a foreign
corporation and in good standing in each jurisdiction where the ownership
or leasing of its properties or the conduct of its business requires such
qualification, except in any such case where the failure to so qualify or
be in good standing would not have a material adverse effect on the
condition (financial or otherwise) or results of operations of the Company
and its subsidiaries, taken as a whole.
(ii) An opinion to the same general effect as clause (i) of this
subparagraph (c) in respect of each direct and indirect subsidiary of the
Company; provided, however, that with respect to each of the Company's
foreign subsidiaries, the opinion as to good standing and qualification as
a foreign corporation may be modified to conform to comparable concepts
under local law.
(iii) All of the issued and outstanding capital stock of the
subsidiaries of the Company has been duly authorized and validly issued and
is fully paid and non-assessable, and the Company owns, of record (except
for directors' or shareholders' qualifying shares held by nominees of the
Company) and to such counsel's knowledge, beneficially, directly or
indirectly 100 percent of the outstanding capital stock of each subsidiary
and, to the knowledge of such counsel (with respect to the Company's
foreign subsidiaries, based solely on an examination of the Share Transfer
Register for such subsidiary), such stock is owned free and clear of any
security interests, claims, liens,
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encumbrances or adverse interests of any nature except as disclosed in the
Registration Statement (including the exhibits thereto).
(iv) The Company has an authorized and outstanding capitalization
as set forth in the Prospectus and the Shares conform to the description
thereof contained in the Prospectus. All of the issued and outstanding
shares of Common Stock have been duly authorized, validly issued and are
fully paid and non-assessable and free of preemptive or other similar
rights and, to such counsel's knowledge, there are no options, agreements,
contracts or other rights in existence to acquire from the Company any
shares of Common Stock, except as set forth in the Prospectus. Except as
described in the Prospectus, to such counsel's knowledge, there are no
holders of the securities of the Company having rights to the registration
thereof.
(v) The Shares to be sold by the Company pursuant to this
Agreement and the Pricing Agreement have been duly authorized and, when
issued and paid for in accordance with this Agreement and the Pricing
Agreement, will be validly issued, fully paid and non-assessable; the
holders of the Shares will not be subject to personal liability by reason
of being such holders; the Shares are not subject to the preemptive rights
of any stockholder of the Company and, to the knowledge of such counsel,
will be free of any security interest, claim, lien, encumbrance or adverse
interest of any nature; the Shares to be sold hereunder have been duly and
validly authorized and qualified for listing on The Nasdaq National Market,
subject to notice of issuance.
(vi) This Agreement and the Pricing Agreement have been duly and
validly authorized, executed and delivered by the Company and are legal,
valid and binding obligations of the Company, enforceable in accordance
with their terms, except as enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally and by general principles of equity, and except
that such counsel need not express an opinion as to those provisions
relating to indemnities for liabilities under the Act.
(vii) No authorization, approval, order or consent of any
governmental authority or agency is required for the valid issuance and
sale of the Shares, except such as may be required under the Act or state
securities laws as to which such counsel need not express an opinion.
(viii) The execution, delivery and performance of this Agreement and
the Pricing Agreement by the Company, the issue and sale of the Shares, and
the consummation of the transactions contemplated hereby and thereby will
not conflict with or result in a breach of any of the provisions of, or
constitute a default under (A) the Company's Restated Certificate of
Incorporation or by-laws or any agreement, franchise, license, indenture,
mortgage, deed of trust or other instrument or agreement known to such
counsel to which the Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries is bound or to which any of
their respective properties is subject or (B) so far as known to such
counsel, any statute, order, rule or regulation applicable to the Company
or any of its subsidiaries of any court or other
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governmental authority or body having jurisdiction over the Company or any
of its subsidiaries or any of their respective properties.
(ix) The Registration Statement has become effective under the Act,
and, to the knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are pending or
contemplated under the Act.
(x) The Registration Statement (including the information deemed
to be part of the Registration Statement at the time of effectiveness
pursuant to Rule 430A(b), if applicable) as amended or supplemented (except
counsel need not express an opinion on the financial statements and notes
thereto, the financial statement schedules and other statistical or
financial data included therein) and the Prospectus and any supplements or
amendments thereto (except counsel need not express an opinion on the
financial statements and notes thereto, the financial statement schedules
and other statistical or financial data included therein) comply as to form
in all material respects with the requirements of the Act and the rules of
the Commission thereunder.
(xi) The statements in the Prospectus in the sections captioned
"Management--1998 Director Stock Option Plan," "--Employee Stock Option
Plans," "Relationship with Parent Company," "Description of Capital Stock"
and "Shares Eligible for Future Sale" in each case insofar as such
statements reflect a summary of the material legal matters or the documents
referred to therein, fairly and accurately present the information called
for by the Act and the applicable rules and regulations promulgated
thereunder.
(xii) To the knowledge of such counsel there are no statutes or
regulations, provisions of the Delaware General Corporate Law or any
pending or threatened litigation or governmental proceedings against the
Company required to be described in the Prospectus which are not so
described, nor of any contracts or documents of a character required to be
described in or filed as a part of the Registration Statement which are not
described or filed as required.
(xiii) Neither the Company nor any of its subsidiaries is an
"investment company" or a person "controlled by" an "investment company"
within the meaning of the Investment Company Act.
(xiv) To such counsel's knowledge, all offers and sales of the
Company's and each of its subsidiaries capital stock prior to the date
hereof were at all relevant times exempt from the registration requirements
of the Act and were duly registered or the subject of an available
exemption from the registration requirements of the applicable state
securities or blue sky laws.
In rendering such opinion, such counsel may rely upon the opinions of
local and foreign counsel as to matters relating to the Company's subsidiaries
and, as to factual matters, on certificates of officers of the Company and of
state officials, in which case their opinion is to state that they are so doing
and copies of such opinions or certificates are to be attached to the
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opinion unless such opinions or certificates (or, in the case of certificates,
the information therein) have been furnished to the Representatives otherwise.
In addition, such counsel shall state that they have participated in
conferences with the Company and its representatives in connection with the
preparation of the Registration Statement and the Prospectus, and in connection
with their participation in the preparation of the Registration Statement and
the Prospectus, although such counsel has not independently verified the
accuracy, completeness or fairness of the statements contained therein, nothing
has come to the attention of such counsel that would cause such counsel to
believe that the Registration Statement (including the information deemed to be
part of the Registration Statement at the time of effectiveness pursuant to Rule
430A(b), if applicable) as amended or supplemented (except such counsel need not
express an opinion on the financial statements and notes thereto, the financial
statement schedules and other statistical or financial data included therein) at
the time it became effective, at the time the Pricing Agreement was executed and
at the Closing Date, contained any untrue statement of a material fact or
omitted or omits to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, or that, as of its
date, the Prospectus or any amendment or supplement thereto (except such counsel
need not express an opinion on the financial statements and notes thereto, the
financial statement schedules and other statistical or financial data included
therein) included or includes any untrue statement of a material fact or omitted
or omits to state any material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.
(d) The Representatives shall have received from Xx. Xxxxx X. Xxxx,
Vice President and General Counsel for GLII, a favorable opinion dated the
Closing Date and satisfactory to the Representatives and the Underwriters'
counsel to the effect that:
(i) GLII has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with
full corporate power and authority to own, lease and operate its properties
and conduct its business.
(ii) This Agreement has been duly and validly authorized, executed
and delivered by GLII and is a legal, valid and binding obligation of GLII,
enforceable in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors' rights generally and by general
principles of equity, and except that such counsel need not express an
opinion as to those provisions relating to indemnities for liabilities
under the Act.
(iii) The execution, delivery and performance of this Agreement by
GLII will not conflict with or result in a breach of any of the provisions
of, or constitute a default under GLII's charter or by-laws or any
agreement, franchise, license, indenture, mortgage, deed of trust or other
instrument or agreement known to such counsel to which GLII is a party or
by which it is bound or to which any of its properties is subject.
(iv) No authorization, approval, order or consent of any
governmental authority or agency is required for the valid issuance and
sale of the Shares, except such as may be
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required under the Act or state securities laws as to which such counsel
need not express an opinion.
(v) The statements in the Prospectus in the section captioned
"Relationship with Parent Company" insofar as such statements reflect a
summary of the material legal matters or the documents referred to therein,
fairly and accurately present the information called for by the Act and the
applicable rules and regulations promulgated thereunder.
In rendering such opinion, such counsel may rely upon certificates of
officers of the Company and of state officials relating to factual matters, in
which case his opinion is to state that he is so doing and copies of such
opinions or certificates are to be attached to the opinion unless such opinions
or certificates (or, in the case of certificates, the information therein) have
been furnished to the Representatives otherwise.
(e) The Representatives shall have received on the Closing Date a
favorable opinion dated the Closing Date from Lord, Bissell & Brook, counsel for
the Underwriters, as to such matters as the Representatives may reasonably
require.
(f) The Representatives shall have received letters addressed to the
Representatives and dated the date hereof, the Closing Date and the Option
Closing Date from KPMG Peat Marwick LLP, independent public accountants for the
Company, to the effect set forth in Schedule II. There shall not have been any
change or decrease specified in the letters referred to in this subparagraph
which makes it impractical or inadvisable in the judgment of the Representatives
to proceed with the public offering or purchase of the Shares as contemplated
hereby.
(g) (i) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been taken or, to the knowledge of the Company, shall be
contemplated by the Commission at or prior to the Closing Date; (ii) there shall
not have been any change in the capital stock of the Company nor any material
increase in the long- term debt of the Company from that set forth or
contemplated in the Registration Statement; (iii) there shall not have been,
since the respective dates as to which information is given in the Registration
Statement and the Prospectus, except as may otherwise be described or
contemplated in the Registration Statement and the Prospectus, any material
adverse change in the financial condition or results of operations of the
Company; and (iv) the Company shall not have incurred any material liabilities
or obligations, direct or contingent, other than in the ordinary course of
business or as described in or contemplated by the Registration Statement,
(h) All of the representations and warranties of the Company
contained in this Agreement shall be true and correct on and as of the date
hereof and the Closing Date and the Option Closing Date as if made on and as of
each such date, the Company shall have performed or complied in all material
respects with all of its agreements herein contained and required to be
performed or complied with by it at or prior to each such date, and the
Representatives shall have received certificates, dated the Closing Date and the
Option Closing Date and signed by the
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23
principal executive officer and the principal financial officer of the Company
(or such other officers as are acceptable to the Representatives), to the effect
set forth in this Section 6(h).
(i) All of the representations and warranties of GLII contained in
this Agreement shall be true and correct on and as of the date hereof and the
Closing Date and the Option Closing Date as if made on and as of each such date,
GLII shall have performed or complied in all material respects with all of its
agreements herein contained and required to be performed or complied with by it
at or prior to each such date, and the Representatives shall have received
certificates, dated the Closing Date and the Option Closing Date and signed by
the principal executive officer and the principal financial officer of GLII (or
such other officers as are acceptable to the Representatives), to the effect set
forth in this Section 6(i).
(j) Within 24 hours after the Registration Statement becomes
effective, or within such longer period as to which the Representatives shall
have consented, the Shares shall have been qualified for sale or exempted from
such qualification under the securities laws of such jurisdictions as the
Representatives shall have designated prior to the time of execution of the
Pricing Agreement and such qualification or exemption shall continue in effect
to and including the Closing Date.
(k) The several obligations of the Underwriters to purchase
Additional Shares hereunder are subject to the satisfaction on and as of the
Option Closing Date of the conditions set forth in paragraphs (a) through (i);
except that the opinions called for in paragraphs (c), (d) and (e) shall be
revised to reflect the sale of Additional Shares and shall be dated the Option
Closing Date, if different from the Closing Date.
SECTION 7. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company and GLII, jointly and severally (collectively, the
"Indemnitors") agree to indemnify and hold harmless each Underwriter and each
person, if any, who controls any Underwriter within the meaning of the Act or
the Exchange Act from and against any and all losses, claims, damages or
liabilities, joint or several, whatsoever (including any investigation, legal or
other expenses incurred in connection with, and any amount paid in settlement
of, any action, suit or proceeding or any claim asserted) to which such
Underwriter, or such controlling person may become subject, arising out of or
based upon any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus or the Registration Statement or the
Prospectus or in any amendment or supplement thereto or arising out of or based
upon any omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and will reimburse each Underwriter for any legal or other expenses reasonably
incurred by such Underwriter in connection with investigating or defending any
such action or claim as such expenses are incurred, except insofar as such
losses, claims, damages or liabilities arise out of or are based upon any such
untrue statement or omission or allegation thereof which has been made therein
or omitted therefrom in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of any Underwriter through
the Representatives expressly for use therein, which information solely consists
of the disclosure included in the Prospectus under the caption "Underwriting";
provided, however, that the indemnification contained in this paragraph
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with respect to any Preliminary Prospectus shall not inure to the benefit of any
Underwriter (or of any person controlling such Underwriter) with respect to any
action or claim arising from the sale of the Shares by such Underwriter brought
by any person who purchased Shares from such Underwriter if (i) a copy of the
Prospectus (as amended or supplemented if any amendments or supplements thereto
shall have been furnished to the Underwriter prior to the written confirmation
of the sale involved) shall not have been given or sent to such person by or on
behalf of the Underwriter with or prior to the written confirmation of the sale
involved and (ii) the untrue statement or omission of a material fact contained
in such Preliminary Prospectus was corrected in the Prospectus (as amended or
supplemented if amended or supplemented as aforesaid).
Notwithstanding the foregoing, the Underwriters agree that, in the
case of any loss, claim, damage, liability or judgment for which they may claim
indemnification hereunder, they will make written demand for indemnification
from the Indemnitors, but will not seek to enforce any right or remedy granted
under this Section 7 against GLII for a period of 30 days after the date of such
demand. The Underwriters further agree that (x) they will not commence any legal
proceeding against GLII to recover such loss, claim, damage or liability unless,
prior to or concurrently therewith, they shall have commenced, in the same legal
proceeding, an action against the Company to recover the same, (y) they will
prosecute any such legal proceeding against the Company for as long as GLII is a
party thereto and (z) in the event that judgments are entered in favor of the
Underwriters against both the Company and GLII in any such legal proceeding, (1)
during the period from the date of each such judgment until the earlier of a
Triggering Event (as defined below) or 30 days after the date on which the
judgment against the Company and GLII becomes final and is not subject to
appeal, the Underwriters will take all reasonably necessary steps to enforce and
collect the judgment entered against the Company, and will not seek to enforce
or collect the judgment entered against GLII, and (2) after the expiration of
the period referred to in clause (1) of this sentence, the Underwriters may seek
to enforce and collect the judgment entered against GLII; provided that any
amounts collected by the Underwriters from the Company under the judgment
entered against the Company shall reduce the amount of the judgment entered
against GLII. As used in this Agreement, "Triggering Event" means any of the
following: (i) the Company or any subsidiary files a petition for relief under
the United States Bankruptcy Code (the "Bankruptcy Code"), (ii) an order or
decree for relief is entered against the Company or any subsidiary in an
involuntary case under the Bankruptcy Code and such order or decree is consented
to by the Company or any subsidiary or remains in effect for 30 consecutive
days, (iii) the Company or any subsidiary makes an assignment for the benefit of
its creditors, (iv) any court orders or approves, or the Company or any
subsidiary consents to, the appointment of a receiver, liquidator, assignee or
other similar official for the Company or any subsidiary or any substantial
portion of its respective assets, and such order or approval continues in effect
for 30 consecutive days, or (v) the dissolution, liquidation or winding up of
the affairs of the Company.
(b) Each Underwriter will severally indemnify and hold harmless GLII,
the Company, the Company's directors, its officers who sign the Registration
Statement and any person controlling the Company or GLII within the meaning of
the Act or the Exchange Act to the same extent as the foregoing indemnity from
the Indemnitors to each Underwriter, but only with respect to information
furnished in writing to the Company by or on behalf of such Underwriter
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25
through the Representatives expressly for use in the Registration Statement, the
Prospectus or any Preliminary Prospectus , which information solely consists of
the disclosure included in the Prospectus under the caption "Underwriting." This
indemnity will be in addition to any liability that each Underwriter might
otherwise have; provided, however, that in no case shall any Underwriter be
liable or responsible for any amount in excess of the underwriting discounts and
commissions received by such Underwriter.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
subsection for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by such indemnified party, in connection with
the defense thereof other than reasonable costs of investigation. No
indemnifying party shall, without the written consent of the indemnified party,
effect the settlement or compromise of, or consent to the entry of any judgment
with respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such action
or claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of any indemnified party. No
indemnifying party shall be liable for any compromise or settlement of any such
action effected without its consent.
(d) (i) If the indemnification provided for in this Section 7 is
unavailable as a matter of law to any indemnified party under this Section 7 in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then the indemnifying party in lieu of indemnifying such indemnified
party thereunder, shall contribute to the amount paid or payable by the
indemnified party (A) in such proportion as is appropriate to reflect the
relative benefits received by the Indemnitors on the one hand and the
Underwriters on the other hand from the offering of the Shares or (B) if the
allocation provided by clause (A) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (A) above but also the relative fault of the Indemnitors
on the one hand and the Underwriters on the other hand in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The respective relative benefits received by the Indemnitors and the
Underwriters shall be deemed to be in the same proportion in the case of the
Indemnitors, as the total price paid to the Company for the Shares by the
Underwriters (net of underwriting discount
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26
but before deducting expenses), and in the case of the Underwriters as the
underwriting discount received by them bears to the total of such amounts paid
to the Company and received by the Underwriters as underwriting discount, in
each case as contemplated by the Prospectus. The relative fault of the
Indemnitors and the Underwriters shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by either of the Indemnitors or by the Underwriters and the
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission of the Indemnitors on the o ne hand and of
the Underwriters on the other hand. The amount paid or payable by an indemnified
party as a result of the losses, claims, damages, liabilities and expenses
referred to in this Section shall be deemed to include, subject to the
limitations set forth in this Section, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any such action or claim.
(ii) The Indemnitors and the Underwriters agree that the
determination of contribution pursuant to this Section based on pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph
would not be just and equitable (even if the several Underwriters were treated
as one entity for such purpose). Notwithstanding the provisions of this Section,
no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Shares underwritten by it and
distributed to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations to contribute
pursuant to this Section are several in proportion to their respective
underwriting commitments and not joint.
(e) The indemnity and contribution agreements contained in this
Section and the representations and warranties of the Company and GLII set forth
in this Agreement shall remain operative and in full force and effect,
regardless of (i) any investigation made by or on behalf of any Underwriter or
any person controlling any Underwriter, the Company or its directors or officers
(or any person controlling the Company), (ii) acceptance of any Shares and
payment therefor hereunder and (iii) any termination of this Agreement. A
successor or assign of an Underwriter, the Company or its directors or officers,
and their legal and personal representatives (or of any person controlling an
Underwriter or the Company) shall be entitled to the benefits of the indemnity,
contribution and reimbursement agreements contained in this Section.
(f) The Company agrees to indemnify GLII for any amounts that GLII is
required to pay pursuant to the foregoing paragraphs of this Section 7. The
provisions of this paragraph (f) are solely for the purpose of regulating the
respective rights and obligations of the Company and GLII and shall have no
effect upon any rights of any Underwriter or any controlling person of any
Underwriter.
SECTION 8. EFFECTIVE DATE OF AGREEMENT. This Agreement shall become
effective immediately as to Sections 5, 7, 10 and 11 and as to all other
provisions at 10:00 A.M., Chicago
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Time, on the day following the date upon which the Pricing Agreement is executed
and delivered, unless such a day is a Saturday, Sunday or holiday (and in that
event this Agreement shall become effective at such hour on the business day
next succeeding such Saturday, Sunday or holiday); but this Agreement shall
nevertheless become effective at such earlier time after the Pricing Agreement
is executed and delivered as you may determine on and by notice to the Company
or by release of any Shares for sale to the public. For the purposes of this
Section, the Shares shall be deemed to have been so released upon the release
for publication of any newspaper advertisement relating to the Shares or upon
the release by you of telegrams or telecopy (i) advising Underwriters that the
Shares are released for public offering, or (ii) offering the Shares for sale to
securities dealers, whichever may occur first.
SECTION 9. DEFAULT OF UNDERWRITERS. If any one or more of the Underwriters
shall fail or refuse to purchase Firm Shares which it or they have agreed to
purchase under this Agreement and the Pricing Agreement and the aggregate number
of Firm Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase is not more than one-tenth of the aggregate number
of Firm Shares, each non-defaulting Underwriter shall be obligated, severally,
in the proportion which the number of Firm Shares set forth opposite its name in
Schedule I bears to the aggregate number of Firm Shares set forth opposite the
names of all non-defaulting Underwriters or in such other proportion as the
Representatives may specify in accordance with the Agreement Among Underwriters,
to purchase the Firm Shares which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase. If any Underwriter or Underwriters
shall fail or refuse to purchase Firm Shares and the aggregate number of Firm
Shares with respect to which such default occurs is more than one-tenth of the
aggregate number of Firm Shares and arrangements satisfactory to the
Representatives and the Company for the purchase of such Firm Shares are not
made within 36 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter or the Company. In any
such case which does not result in termination of this Agreement, either the
Representatives or the Company shall have the right to postpone the Closing
Date, but in no event for longer than seven days, in order that the required
changes, if any, in the Registration Statement and the Prospectus or any other
documents or arrangements may be effected. Any action taken under this paragraph
shall not relieve any defaulting Underwriter from liability in respect of any
such default of any such Underwriter under this Agreement. Any notice under this
Section 9 may be made by telecopy, telegram or telephone but shall be
subsequently confirmed by letter.
SECTION 10. TERMINATION OF AGREEMENT. This Agreement and the Pricing
Agreement shall be subject to termination by notice given by you to the Company,
if (a) after the execution and delivery of this Agreement and the Pricing
Agreement and prior to the Closing Date (and with respect to the Additional
Shares, the Option Closing Date) (i) trading generally shall have been suspended
or materially limited on or by, as the case may be, any of the New York Stock
Exchange, the American Stock Exchange, or the Nasdaq National Market, (ii)
trading of any securities of the Company shall have been suspended on any
exchange or in any over-the-counter market, (iii) a general moratorium on
commercial banking activities in New York or in Chicago shall have been declared
by either Federal, New York or Illinois State authorities or (iv) there shall
have occurred any outbreak or escalation of hostilities or any change in
financial markets that, in your reasonable judgment, is material and adverse and
(b) in the case of any of the events
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28
specified in clauses (a)(i) through (iv), such event, singly or together with
any other such event, makes it, in your judgment, impracticable to market the
Shares on the terms and in the manner contemplated in the Prospectus. Notice of
such cancellation shall be given to the Company by telecopy, telegram or
telephone but shall be subsequently confirmed by letter.
SECTION 11. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If this Agreement is
terminated pursuant to Section 9 or Section 10, the Company and GLII shall not
then be under any liability to any Underwriter except as provided in Section 5
and Section 7. However, if the sale to the Underwriters of the Shares on the
Closing Date is not consummated because any condition to the Underwriters'
obligations hereunder set forth in Section 6 is not satisfied or because of any
refusal, inability or failure on the part of the Company or GLII to perform any
agreement herein or to comply with any provision hereof, unless such failure to
satisfy such condition or to comply with any provision hereof is due to the
default or omission of any Underwriter, the Company agrees to reimburse you and
the other Underwriters upon demand for all out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been reasonably
incurred by you and them in connection with the proposed purchase and the sale
of the Shares. Any such termination shall be without further liability of any
party to any other party except that the provisions of this Section, Section 5
and Section 7 shall at all times be effective and shall apply.
SECTION 12. NOTICES. Except as otherwise provided in Sections 9 and 10
hereof, notice given pursuant to any of the provisions of this Agreement shall
be in writing and shall be delivered (a) if to the Company, at the office of the
Company at 0000 Xxxxxx Xxxx, Xxxxx 000, Xxx Xxxxx, XX 00000, Attention: Xx.
Xxxxx Xxxx, and if to GLII at Xxx Xxxxxxxx Xxxxxx, Xxxxx, XX 00000-0000,
Attention: Xx. Xxxxxx X. Xxxxxxx, Xx., with a copy to Xxxx, Xxxx & Xxxxx, Three
First National Plaza, 00 Xxxx Xxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, XX 00000,
Attention Xx. Xxxx X. Blew or (b) if to the Representatives, at the offices of
ABN AMRO Incorporated, 000 Xxxxx XxXxxxx Xxxxxx, 0xx Xxxxx, Xxxxxxx, Xxxxxxxx
00000, Attention: Corporate Finance Department, with a copy to Lord, Bissell &
Brook, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, XX 00000, Attention: Xx. Xxxxx X.
Xxxxx or in any case to such other address as the person to be notified may have
requested in writing.
SECTION 13. SUCCESSORS. The Agreement and the Pricing Agreement are made
solely for the benefit of the several Underwriters, the Company, GLII, their
respective directors and officers and their legal representatives and other
controlling persons referred to in Section 7 hereof, and their respective
successors and assigns, and no other person, either as a third party beneficiary
or otherwise, shall acquire or have any right under or by virtue of this
Agreement or the Pricing Agreement. The term "successors and assigns" as used in
this Agreement shall not include a purchaser from any of the several
Underwriters of any of the Shares in his status as such purchaser.
SECTION 14. REPRESENTATION OF UNDERWRITERS. The Representatives will act
for the several Underwriters in connection with the purchase, offering and sale
of the Shares, and any action taken by the Representatives will be binding upon
all the Underwriters.
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SECTION 15. PARTIAL UNENFORCEABILITY. If any section, paragraph or
provision of this Agreement is for any reason determined to be invalid or
unenforceable, such determination shall not affect the validity or
enforceability of any other section, paragraph or provision hereof.
SECTION 16. APPLICABLE LAW. This Agreement and the Pricing Agreement shall
be governed by and construed in accordance with the laws of the State of
Illinois.
SECTION 17. COUNTERPARTS. This Agreement may be signed in various
counterparts which together shall constitute one and the same instrument.
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Please confirm that the foregoing correctly sets forth the agreement
among the Company and the several Underwriters.
Very truly yours,
XXXXXXXX MICRO SCIENCE
INTERNATIONAL, INC.
BY: _____________________________
NAME:
TITLE:
XXXXXXXX LABORATORIES
INTERNATIONAL, INC.
BY: _____________________________
NAME:
TITLE:
ACCEPTED AND DELIVERED AS OF
THE DATE FIRST WRITTEN ABOVE.
ABN AMRO INCORPORATED
XXXXXX X. XXXXX & CO. INCORPORATED
ACTING AS REPRESENTATIVES OF THE
SEVERAL UNDERWRITERS NAMED IN
SCHEDULE I HERETO
BY: ABN AMRO INCORPORATED
BY:
----------------------------------
NAME:
TITLE:
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31
XXXXXXXX MICRO SCIENCE INTERNATIONAL, INC.
SCHEDULE I
UNDERWRITERS
NUMBER OF
NAME FIRM SHARES
ABN AMRO Incorporated..........................................................
Xxxxxx X. Xxxxx & Co. Incorporated......................................_______
TOTAL............................................................
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XXXXXXXX MICRO SCIENCE INTERNATIONAL, INC.
SCHEDULE II
Comfort Letter of KPMG Peat Marwick, LLP
(1) They are independent public accountants with respect to the Company and
its subsidiaries within the meaning of the Act.
(2) In their opinion the consolidated financial statements and schedules of
the Company and its subsidiaries included in the Registration Statement and the
consolidated and combined financial statements of the Company from which the
information presented under the caption "Selected Financial Data" has been
derived which are stated therein to have been examined by them comply as to form
in all material respects with the applicable accounting requirements of the Act.
(3) On the basis of specified procedures (but not an examination in
accordance with generally accepted auditing standards), including inquiries of
certain officers of the Company and its subsidiaries responsible for financial
and accounting matters as to transactions and events subsequent to September 30,
1997, a reading of minutes of meetings of the stockholders and directors of the
Company and its subsidiaries since September 30, 1997, a reading of the latest
available interim unaudited consolidated financial statements of the Company and
its subsidiaries (with an indication of the date thereof) and other procedures
as specified in such letter, nothing came to their attention which caused them
to believe that (i) the unaudited consolidated financial statements of the
Company and its subsidiaries included in the Registration Statement do not
comply as to form in all material respects with the applicable accounting
requirements of the Act or that such unaudited financial statements are not
fairly presented in accordance with generally accepted accounting principles
applied on a basis substantially consistent with that of the audited financial
statements included in the Registration Statement, (ii) the pro forma financial
data of the Company included in the Registration Statement does not comply as to
form with the applicable accounting requirements of the Act, or that the pro
forma adjustments have not been properly applied to the historical amounts for
the periods to which they relate and (iii) at a specified date not more than
five days prior to the date thereof in the case of the first letter and not more
than two business days prior to the date thereof in the case of the second and
third letters, there was any change in the capital stock or long-term debt or
short-term debt (other than normal payments) of the Company and its subsidiaries
on a consolidated basis or any decrease in consolidated net current assets or
consolidated stockholders' equity as compared with amounts shown on the latest
unaudited balance sheet of the Company included in the Registration Statement or
for the period from the date of such balance sheet to a date not more than five
days prior to the day thereof in the case of the first letter and not more than
two business days prior to the date thereof in the case of the second and third
letters, there were any decreases, as compared with the corresponding period of
the prior year, in consolidated net sales, consolidated income before income
taxes or in the total or per
33
share amounts of consolidated net income except, in all instances, for changes
or decreases which the Prospectus discloses have occurred or may occur or which
are set forth in such letter.
(4) They have carried out specified procedures, which have been agreed to
by the Representatives, with respect to certain information in the Prospectus
specified by the Representatives, and on the basis of such procedures, they have
found such information to be in agreement with the general accounting records of
the Company and its subsidiaries.
34
EXHIBIT A
2,500,000 SHARES*
XXXXXXXX MICRO SCIENCE INTERNATIONAL, INC.
CLASS A COMMON STOCK
PRICING AGREEMENT
__________, 1998
ABN AMRO Incorporated
Xxxxxx X. Xxxxx & Co. Incorporated
As Representatives of the
several Underwriters named
in Schedule I hereto
c/o ABN AMRO Incorporated
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
Reference is made to the Underwriting Agreement, dated _______ __, 1998
(the "Underwriting Agreement"), relating to the purchase by the several
Underwriters named in Schedule I thereto (collectively, the "Underwriters"), for
whom you are acting individually and as representatives (the "Representatives"),
of the above referenced Class A Common Stock (the "Shares") of Xxxxxxxx Micro
Science International, Inc. (the "Company").
Pursuant to Section 3 of the Underwriting Agreement, the Company agrees
with each of the Underwriters as follows:
1. The initial public offering price per share of the Shares determined as
provided in said Section 3 shall be $_______.
2. The purchase price per share of the Shares to be paid by the several
Underwriters shall be $________, being an amount equal to the initial public
offering price set forth above, less $_______ per Share.
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along
35
with all counterparts, will become a binding agreement among the Underwriters
and the Company in accordance with its terms.
Very truly yours,
XXXXXXXX MICRO SCIENCE
INTERNATIONAL, INC.
BY:___________________________
NAME:
TITLE:
Confirmed and Accepted, as of the date
first above written for themselves and
as Representatives of the other Underwriters
named in the Underwriting Agreement:
ABN AMRO INCORPORATED
XXXXXX X. XXXXX & CO. INCORPORATED
Acting as Representatives of the Several
Underwriters named in Schedule I to
the Underwriting Agreement
BY: ABN AMRO INCORPORATED
BY: ____________________________________
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