1
EXHIBIT 1.1
INTERACTIVE PICTURES CORPORATION
4,200,000 Shares of Common Stock
Underwriting Agreement
, 1999
X.X. Xxxxxx Securities Inc.
Xxxxxxxxx & Xxxxx LLC
Xxxxxx Xxxxxx & Company, Inc.
Xxxxxxxx Inc.
As Representatives of the several underwriters
listed in Schedule I hereto
c/o X.X. Xxxxxx Securities Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Interactive Pictures Corporation, a Tennessee corporation (the
"Company"), proposes to issue and sell to the several Underwriters listed in
Schedule I hereto (the "Underwriters"), for whom you are acting as
representatives (the "Representatives"), an aggregate of 3,850,000 shares (the
"Company Underwritten Shares") of common stock, par value $.001 per share, of
the Company (the "Common Stock") and certain shareholders of the Company named
in Schedule II hereto (the "Selling Shareholders") propose to sell to the
several Underwriters an aggregate of 350,000 shares (the "Selling Shareholder
Underwritten Shares" and, together with the Company Underwritten Shares, the
"Underwritten Shares") of Common Stock. In addition, at the option of the
Underwriters and for the sole purpose of covering over-allotments in connection
with the sale of the Underwritten Shares, the Company proposes to issue and sell
to the Underwriters up to an additional 630,000 shares (the "Option Shares") of
Common Stock. The Underwritten Shares and the Option Shares are herein referred
to as the "Shares."
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 "Securities Act"), a registration
statement, including a prospectus, relating to the Shares. The registration
statement as amended at the time when it shall become effective including
information (if any) deemed to be part of the registration statement at the time
of effectiveness pursuant to Rule 430A under the Securities Act, is referred to
in this
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Agreement as the "Registration Statement", and the prospectus in the form first
used to confirm sales of Shares is referred to in this Agreement as the
"Prospectus." If the Company has filed an abbreviated registration statement
pursuant to Rule 462(b) under the Securities Act (the "Rule 462 Registration
Statement"), then any reference herein to the term "Registration Statement"
shall be deemed to include such Rule 462 Registration Statement.
1. The Company agrees to issue and sell the Company Underwritten
Shares, and the Selling Shareholders agree, severally and not jointly, to sell
the Selling Shareholder Underwritten Shares set forth opposite the name of each
such Selling Shareholder on Schedule II hereto to the several Underwriters as
hereinafter provided, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees to purchase, severally and not jointly, from the
Company and the Selling Shareholders at a purchase price per share of $____ (the
"Purchase Price") the number of Underwritten Shares (to be adjusted by you so as
to eliminate fractional shares) determined by multiplying the aggregate number
of Underwritten Shares to be sold by the Company and the Selling Shareholders by
a fraction, the numerator of which is the aggregate number of Underwritten
Shares to be purchased by such Underwriter as set forth opposite the name of
such Underwriter in Schedule I hereto and the denominator of which is the
aggregate number of Underwritten Shares to be purchased by all the Underwriters
from the Company and the Selling Shareholders hereunder.
In addition, the Company agrees to sell the Option Shares to the
several Underwriters, and the Underwriters shall have the option to purchase at
their election up to 630,000 Option Shares from the Company for the sole purpose
of covering over-allotments in the sale of the Underwritten Shares. The
Underwriters, on the basis of the representations and warranties herein
contained, but subject to the conditions hereinafter stated, shall have the
option to purchase, severally and not jointly, from the Company at the Purchase
Price that portion of the number of Option Shares as to which such election
shall have been exercised (to be adjusted by you so as to eliminate fractional
shares) determined by multiplying such number of Option Shares by a fraction the
numerator of which is the maximum number of Option Shares which such Underwriter
is entitled to purchase and the denominator of which is the maximum number of
Option Shares that all of the Underwriters are entitled to purchase hereunder,
for the sole purpose of covering over-allotments (if any) in the sale of the
Underwritten Shares by the several Underwriters.
The Underwriters may exercise the option to purchase the Option Shares
at any time (but not more than once) on or before the thirtieth day following
the date of this Agreement, by written notice from the Representatives to the
Company. Such notice shall set forth the aggregate number of Option Shares as to
which the option is being exercised and the date and time when the Option Shares
are to be delivered and paid for which may be the same date and time as the
Closing Date (as hereinafter defined) but shall not be earlier
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than the Closing Date nor later than the tenth full Business Day (as hereinafter
defined) after the date of such notice (unless such time and date are postponed
in accordance with the provisions of Section 9 hereof). Any such notice shall be
given at least two full Business Days prior to the date and time of delivery
specified therein.
2. The Company and the Selling Shareholders understand that the
Underwriters intend (i) to make a public offering of the Shares as soon after
(A) the Registration Statement has become effective and (B) the parties hereto
have executed and delivered this Agreement, as in the judgment of the
Representatives is advisable and (ii) initially to offer the Shares upon the
terms set forth in the Prospectus.
3. Payment for the Shares shall be made by wire transfer in
immediately available funds (X) to the account specified to the Representatives
by the Company with regard to payment to the Company in the case of the Company
Underwritten Shares and to the account specified by the Attorneys-in-Fact (as
defined below) with regard to payment to the Selling Shareholders with regard to
the Selling Shareholder Underwritten Shares, on , 1999, or at such other
time on the same or such other date, not later than the fifth Business Day
thereafter, as the Representatives and the Company and the Selling Shareholders
may agree upon in writing or (Y) to the account specified to the Representatives
by the Company with regard to payment to the Company with regard to the Option
Shares on the date and time specified by the Representatives in the written
notice of the Underwriters' election to purchase such Option Shares. The time
and date of such payment for the Underwritten Shares is referred to herein as
the "Closing Date" and the time and date for such payment for the Option Shares,
if other than the Closing Date, are herein referred to as the "Additional
Closing Date." As used herein, the term "Business Day" means any day other than
a day on which banks are permitted or required to be closed in New York City.
Payment for the Shares to be purchased on the Closing Date or the
Additional Closing Date, as the case may be, shall be made against delivery to
the Representatives for the respective accounts of the several Underwriters of
the Shares to be purchased on such date registered in such names and in such
denominations as the Representatives shall request in writing not later than two
full Business Days prior to the Closing Date or the Additional Closing Date, as
the case may be, with any transfer taxes payable in connection with the transfer
to the Underwriters of the Shares duly paid by the Company or the Selling
Shareholders, as the case may be. The certificates for the Shares will be made
available for inspection and packaging by the Representatives at the office of
X.X. Xxxxxx Securities Inc. set forth above not later than 1:00 P.M., New York
City time, on the Business Day prior to the Closing Date or the Additional
Closing Date, as the case may be.
4. (A) The Company represents and warrants to each Underwriter
and each Selling Shareholder that:
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(a) no order preventing or suspending the use of any
preliminary prospectus has been issued by the Commission, and each
preliminary prospectus filed as part of the Registration Statement as
originally filed or as part of any amendment thereto, or filed pursuant
to Rule 424 under the Securities Act, complied when so filed in all
material respects with the Securities Act, and did not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information relating to any Underwriter furnished to
the Company in writing by such Underwriter through the Representatives
expressly for use therein;
(b) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceeding for that
purpose has been instituted or, to the knowledge of the Company,
threatened by the Commission; and the Registration Statement and
Prospectus (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) comply, or will
comply, as the case may be, in all material respects with the
Securities Act and do not and will not, as of the applicable effective
date as to the Registration Statement and any amendment thereto and as
of the date of the Prospectus and any amendment or supplement thereto,
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading, and the Prospectus, as amended or
supplemented, if applicable, at the Closing Date or Additional Closing
Date, as the case may be, will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading; except that the foregoing representations and
warranties shall not apply to statements or omissions in the
Registration Statement or the Prospectus made in reliance upon and in
conformity with information relating to any Underwriter furnished to
the Company in writing by such Underwriter through the Representatives
expressly for use therein;
(c) the financial statements, and the related notes
thereto, included in the Registration Statement and the Prospectus
present fairly the consolidated financial position of the Company and
its consolidated subsidiaries as of the dates indicated and the results
of their operations and changes in their consolidated cash flows for
the periods specified; said financial statements have been prepared in
conformity with generally accepted accounting principles applied on a
consistent basis, and the supporting schedules included in the
Registration Statement present fairly the information required to be
stated therein;
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(d) since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not
been any change in the capital stock or long-term debt of the Company
or any of its subsidiaries, or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the general affairs, business, prospects, management,
financial position, shareholders' equity or results of operations of
the Company and its subsidiaries, taken as a whole (a "Material Adverse
Change"), otherwise than as set forth or contemplated in the
Prospectus; and except as set forth or contemplated in the Prospectus
neither the Company nor any of its subsidiaries has entered into any
transaction or agreement (whether or not in the ordinary course of
business) material to the Company and its subsidiaries taken as a
whole;
(e) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, with power and authority (corporate and
other) to own its properties and conduct its business as described in
the Prospectus, and has been duly qualified as a foreign corporation
for the transaction of business and is in good standing under the laws
of each other jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such qualification, other than
where the failure to be so qualified or in good standing would not have
a material adverse effect on the general affairs, business, prospects,
management, financial position, shareholders' equity or results of
operations of the Company and its subsidiaries, taken as a whole (a
"Material Adverse Effect");
(f) each of the Company's subsidiaries has been duly
incorporated or organized and is validly existing as a corporation
under the laws of its jurisdiction of incorporation or organization,
with power and authority (corporate and other) to own its properties
and conduct its business as described in the Prospectus, and has been
duly qualified as a foreign corporation for the transaction of business
and is in good standing under the laws of each jurisdiction in which it
owns or leases properties, or conducts any business, so as to require
such qualification, other than where the failure to be so qualified or
in good standing would not have a Material Adverse Effect; and all the
outstanding shares of capital stock of each subsidiary of the Company
have been duly authorized and validly issued, are fully-paid and
non-assessable, and (except, in the case of foreign subsidiaries, for
directors' qualifying shares and except as described in the Prospectus)
are owned by the Company, directly or indirectly, free and clear of all
liens, encumbrances, security interests and claims;
(g) this Agreement has been duly authorized, executed and
delivered by the Company;
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(h) the Company has an authorized capitalization as set
forth in the Prospectus and such authorized capital stock conforms as
to legal matters to the description thereof set forth in the
Prospectus, and all of the outstanding shares of capital stock of the
Company have been duly authorized and validly issued, are fully-paid
and non-assessable and are not subject to any pre-emptive or similar
rights; and, except as described in or expressly contemplated by the
Prospectus, there are no outstanding rights (including, without
limitation, pre-emptive rights), warrants or options to acquire, or
instruments convertible into or exchangeable for, any shares of capital
stock or other equity interest in the Company or any of its
subsidiaries, or any contract, commitment, agreement, understanding or
arrangement of any kind relating to the issuance of any capital stock
of the Company or any such subsidiary, any such convertible or
exchangeable securities or any such rights, warrants or options;
(i) the Company Underwritten Shares and the Option Shares
have been duly authorized, and, when issued and delivered to and paid
for by the Underwriters in accordance with the terms of this Agreement,
will be duly issued and will be fully paid and non-assessable and will
conform to the descriptions thereof in the Prospectus; and the issuance
of such Shares is not subject to any preemptive or similar rights;
(j) neither the Company nor any of its subsidiaries is,
or with the giving of notice or lapse of time or both would be, in
violation of or in default under, its certificate or articles of
incorporation or by-laws or any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the Company or
any of its subsidiaries is a party or by which it or any of them or any
of their respective properties is bound, except for violations and
defaults which individually and in the aggregate are not material to
the Company and its subsidiaries taken as a whole; the issue and sale
of the Shares to be sold by the Company hereunder and the performance
by the Company of its obligations under this Agreement and the
consummation of the transactions contemplated herein will not conflict
with or result in a breach of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust,
loan agreement 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 is bound or to which any of the property or assets of
the Company or any of its subsidiaries is subject, nor will any such
action result in any violation of the provisions of the certificate or
articles of incorporation or the by-laws of the Company or any
applicable law or statute or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over the Company,
its subsidiaries or any of their respective properties; and no consent,
approval, authorization, order, license, registration or qualification
of or with any such court
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or governmental agency or body is required for the issue and sale of
the Shares to be sold by the Company hereunder or the consummation by
the Company of the transactions contemplated by this Agreement, except
such consents, approvals, authorizations, orders, licenses,
registrations or qualifications as have been obtained under the
Securities Act and as may be required under state securities or Blue
Sky Laws in connection with the purchase and distribution of the Shares
by the Underwriters;
(k) other than as set forth or contemplated in the
Prospectus, there are no legal or governmental investigations, actions,
suits or proceedings pending or, to the knowledge of the Company,
threatened against or affecting the Company or any of its subsidiaries
or any of their respective properties or to which the Company or any of
its subsidiaries is or may be a party or to which any property of the
Company or any of its subsidiaries is or may be the subject which, if
determined adversely to the Company or any of its subsidiaries, could
individually or in the aggregate have, or reasonably be expected to
have, a Material Adverse Effect, and, to the best of the Company's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others; and there are no
statutes, regulations, contracts or other documents that are required
to be described in the Registration Statement or Prospectus or to be
filed as exhibits to the Registration Statement that are not described
or filed as required;
(l) the Company and its subsidiaries have good and
marketable title in fee simple to all items of real property and good
and marketable title to all personal property owned by them, in each
case free and clear of all liens, encumbrances and defects except such
as are described or referred to in the Prospectus or such as do not
materially affect the value of such property and do not interfere with
the use made or proposed to be made of such property by the Company and
its subsidiaries; and any real property and buildings held under lease
by the Company and its subsidiaries are held by them under valid,
existing and enforceable leases with such exceptions as are not
material and do not interfere with the use made or proposed to be made
of such property and buildings by the Company or its subsidiaries;
(m) no relationship, direct or indirect, exists between
or among the Company or any or its subsidiaries on the one hand, and
the directors, officers, shareholders, customers or suppliers of the
Company or any of its subsidiaries on the other hand, which is required
by the Securities Act to be described in the Registration Statement and
the Prospectus which is not so described;
(n) except as disclosed in the Registration Statement, no
person has the right to require the Company to register any securities
for offering and sale under the Securities Act by reason of the filing
of the Registration Statement with the Commission or the issue and sale
of the Shares to be sold by the Company hereunder
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or, to the best knowledge of the Company, the sale of the Shares to be
sold by the Selling Shareholders hereunder; all holders of securities
of the Company having rights to the registration of shares of Common
Stock, or other securities, because of the filing of the Registration
Statement by the Company, have waived such rights or such rights have
expired by reason of lapse of time following notification of the
Company's intent to file the Registration Statement;
(o) the Company is not and, after giving effect to the
offering and sale of the Shares, will not be an "investment company" or
an entity "controlled" by an "investment company", as such terms are
defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act");
(p) the Company has complied with all provisions of
Section 517.075, Florida Statutes (Chapter 92-198, Laws of Florida)
relating to doing business with the Government of Cuba or with any
person or affiliate located in Cuba;
(q) PricewaterhouseCoopers LLP ("PricewaterhouseCoopers")
who have certified certain financial statements of the Company and its
subsidiaries are independent public accountants as required by the
Securities Act;
(r) the Company and its subsidiaries have filed all
federal, state, local and foreign tax returns which have been required
to be filed and have paid all taxes shown thereon and all assessments
received by them or any of them to the extent that such taxes have
become due and are not being contested in good faith; and, except as
disclosed in the Registration Statement and the Prospectus, there is no
tax deficiency which has been or might reasonably be expected to be
asserted or threatened against the Company or any subsidiary;
(s) the Company has not taken nor will it take, directly
or indirectly, any action designed to, or that might be reasonably
expected to, cause or result in stabilization or manipulation of the
price of the Common Stock;
(t) each of the Company and its subsidiaries owns,
possesses or has obtained all licenses, permits, certificates,
consents, orders, approvals and other authorizations from, and has made
all declarations and filings with, all federal, state, local and other
governmental authorities (including foreign regulatory agencies), all
self-regulatory organizations and all courts and other tribunals,
domestic or foreign, necessary to own or lease, as the case may be, and
to operate its properties and to carry on its business as conducted as
of the date hereof, and neither the Company nor any such subsidiary has
received any actual notice of any proceeding relating to revocation or
modification of any such license, permit, certificate, consent, order,
approval or other authorization, except as described in the
Registration Statement
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and the Prospectus; and each of the Company and its subsidiaries is in
compliance with all laws and regulations relating to the conduct of its
business as conducted as of the date hereof, except for noncompliance
which would not, singly or in the aggregate, have a Material Adverse
Effect;
(u) there are no existing or, to the best knowledge of
the Company, threatened labor disputes with the employees of the
Company or any of its subsidiaries which are likely to have a Material
Adverse Effect;
(v) the Company and its subsidiaries (i) are in
compliance with any and all applicable foreign, federal, state and
local laws and regulations relating to the protection of human health
and safety, the environment or hazardous or toxic substances or wastes,
pollutants or contaminants ("Environmental Laws"), (ii) have received
all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective businesses
and (iii) are in compliance with all terms and conditions of any such
permit, license or approval, except where such noncompliance with
Environmental Laws, failure to receive required permits, licenses or
other approvals or failure to comply with the terms and conditions of
such permits, licenses or approvals would not, singly or in the
aggregate, have a Material Adverse Effect;
(w) each employee benefit plan, within the meaning of
Section 3(3) of the Employee Retirement Income Security Act of 1974, as
amended, ("ERISA") that is maintained, administered or contributed to
by the Company or any of its affiliates for employees or former
employees of the Company and its affiliates has been maintained in
compliance with its terms and the requirements of any applicable
statutes, orders, rules and regulations, including but not limited to
ERISA and the Internal Revenue Code of 1986, as amended ("Code"). To
the knowledge of the Company, no prohibited transaction, within the
meaning of Section 406 of ERISA or Section 4975 of the Code has
occurred with respect to any such plan excluding transactions effected
pursuant to a statutory or administrative exemption. For each such plan
which is subject to the funding rules of Section 412 of the Code or
Section 302 of ERISA no "accumulated funding deficiency" as defined in
Section 412 of the Code has been incurred, whether or not waived, and
the fair market value of the assets of each such plan (excluding for
these purposes accrued but unpaid contributions) exceeded the present
value of all benefits accrued under such plan determined using
reasonable actuarial assumptions;
(x) each of the Company and its subsidiaries owns, is
licensed to use or otherwise possesses adequate rights to use the
patents, patent rights, licenses, inventions, trademarks, service
marks, trade names, copyrights and know-how, including trade secrets
and other unpatented and/or unpatentable proprietary or confidential
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information, systems or procedures (collectively, the "Intellectual
Property") necessary to carry on the business conducted by it, except
to the extent that the failure to own, be licensed to use or otherwise
possess adequate rights to use such Intellectual Property would not
have a Material Adverse Effect; except as set forth in the Prospectus,
the Company has not received any notice of infringement of or conflict
with (and the Company has no knowledge of any infringement of or
conflict with ) asserted rights of others with respect to its
Intellectual Property; the discoveries, inventions, products or
processes of the Company referred to in the Registration Statement and
the Prospectus do not, to the knowledge of the Company, infringe or
conflict with any right or patent of any third party, or any discovery,
patent product or process which is the subject of a patent application
filed by any third party, known to the Company which could have a
Material Adverse Effect;
(y) the statistical and market-related data included in
the Registration Statement and the Prospectus are based on or derived
from sources which are believed by the Company to be reliable;
(z) the Company carries, or is covered by, insurance in
such amounts and covering such risks as is adequate for the conduct of
its business and the value of its properties and as is customary for
companies engaged in similar businesses in similar industries;
(aa) except for compensation to be received by the
Underwriters under this Agreement, the Company does not know of any
outstanding claims for services, either in the nature of a finder's fee
or origination fee, with respect to any of the transactions
contemplated hereby;
(bb) The Company has reviewed its operations, the
operations of its subsidiaries and the operations of any third parties
with which the Company has a material relationship to evaluate the
extent to which the business or operations of the Company will be
affected by the Year 2000 Problem. As a result of such review and
except as disclosed in the Prospectus, the Company has no reason to
believe, and does not believe, that the Year 2000 Problem will have a
Material Adverse Effect or result in any material loss or interference
with the Company's or any subsidiary's business or operations. The
"Year 2000 Problem" as used herein means any significant risk that
computer hardware or software used in the receipt, transmission,
processing, manipulation, storage, retrieval, retransmission or other
utilization of data or in the operation of mechanical or electrical
systems of any kind will not, in the case of dates or time periods
occurring after December 31, 1999, function at least as effectively as
in the case of dates or time periods occurring prior to January 1,
2000; and
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(cc) the Company has delivered to the Representatives
written agreements, substantially in the form set forth as Exhibit A
hereto (each, a "Lock-Up Agreement"), of each of its directors and
executive officers and certain stockholders previously identified by
the Representatives.
(B) Each of the Selling Shareholders severally represents
and warrants to, and agrees with, each of the Underwriters that:
(a) all consents, approvals, authorizations and orders
necessary for the execution and delivery by such Selling Shareholder of
this Agreement and the Power of Attorney (the "Power of Attorney") and
the Custody Agreement (the "Custody Agreement") hereinafter referred
to, and for the sale and delivery of the Shares to be sold by such
Selling Shareholder hereunder, have been obtained; and such Selling
Shareholder has full right, power and authority to enter into this
Agreement, the Power of Attorney and the Custody Agreement and to sell,
assign, transfer and deliver the Shares to be sold by such Selling
Shareholder hereunder; this Agreement, the Power of Attorney and the
Custody Agreement have each been duly authorized, executed and
delivered by such Selling Shareholder;
(b) the sale of the Shares to be sold by such Selling
Shareholder hereunder and the compliance by such Selling Shareholder
with all of the provisions of this Agreement, the Power of Attorney and
the Custody Agreement and the consummation of the transactions herein
and therein contemplated will not conflict with or result in a breach
or violation of any of the terms or provisions of, or constitute a
default under, any statute, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which such Selling
Shareholder is a party or by which such Selling Shareholder is bound or
to which any of the property or assets of such Selling Shareholder is
subject, nor will such action result in any violation of any statute or
any order, rule or regulation of any court or governmental agency or
body having jurisdiction over such Selling Shareholder or the property
of such Selling Shareholder;
(c) such Selling Shareholder has good and valid title to
the Selling Shareholder Underwritten Shares to be sold at the Closing
Date by such Selling Shareholder hereunder, free and clear of all
liens, encumbrances, equities or adverse claims; such Selling
Shareholder will have, immediately prior to the Closing Date, good and
valid title to the Selling Shareholder Underwritten Shares to be sold
at the Closing Date by such Selling Shareholder, free and clear of all
liens, encumbrances, equities or adverse claims; and, upon delivery of
the certificates representing such Selling Shareholder Underwritten
Shares and payment therefor pursuant hereto, good and valid title to
such Selling Shareholder Underwritten Shares, free and clear of all
liens, encumbrances, equities or adverse claims, will pass to the
several Underwriters;
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(d) such Selling Shareholder has not taken and will not
take, directly or indirectly, any action which is designed to or which
has constituted or which might reasonably be expected to cause or
result in stabilization or manipulation of the price of any security of
the Company to facilitate the sale or resale of the Shares; and
(e) the information pertaining to such Selling
Shareholder under the caption "Principal and Selling Shareholders" in
the Prospectus is complete and accurate in all material respects;
(f) when the Registration Statement becomes effective and
at all times subsequent thereto through the latest of the Closing Date,
the Additional Closing Date or the termination of the offering of the
Shares, such parts of the Registration Statement and Prospectus, and
any supplements or amendments thereto, as they relate to such Selling
Shareholder will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; and
(g) such Selling Shareholder has no reason to believe
that the representations and warranties of the Company contained in
Section 4(A) of this Agreement are not true and correct in all material
respects.
Each of the Selling Shareholders represents and warrants that
certificates in negotiable form representing all of the Selling Shareholder
Underwritten Shares to be sold by such Selling Shareholders hereunder have been
placed in custody under a Custody Agreement relating to such Shares, in the form
heretofore furnished to you, duly executed and delivered by such Selling
Shareholder to the Company, as custodian (the "Custodian"), and that such
Selling Shareholder has duly executed and delivered Powers of Attorney, in the
form heretofore furnished to you, appointing the person or persons indicated in
Schedule II hereto, and each of them, as such Selling Shareholder's
Attorneys-in-fact (the "Attorneys-in-Fact" or any one of them the "Attorney-in
Fact") with authority to execute and deliver this Agreement on behalf of such
Selling Shareholder, to determine the purchase price to be paid by the
Underwriters to the Selling Shareholders as provided herein, to authorize the
delivery of the Shares to be sold by such Selling Shareholder hereunder and
otherwise to act on behalf of such Selling Shareholder in connection with the
transactions contemplated by this Agreement and the Custody Agreement.
Each of the Selling Shareholders specifically agrees that the
Selling Shareholder Underwritten Shares represented by the certificates held in
custody for such Selling Shareholder under the Custody Agreement, are subject to
the interests of the Underwriters
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hereunder, and that the arrangements made by such Selling Shareholder for such
custody, and the appointment by such Selling Shareholder of the
Attorneys-in-Fact by the Power of Attorney, are to that extent irrevocable. Each
of the Selling Shareholders specifically agrees that the obligations of such
Selling Shareholder hereunder shall not be terminated by operation of law,
whether by the death or incapacity of any individual Selling Shareholder, or, in
the case of an estate or trust, by the death or incapacity of any executor or
trustee or the termination of such estate or trust, or in the case of a
partnership or corporation, by the dissolution of such partnership or
corporation, or by the occurrence of any other event. If any individual Selling
Shareholder or any such executor or trustee should die or become incapacitated,
or if any such estate or trust should be terminated, or if any such partnership
or corporation should be dissolved, or if any other such event should occur,
before the delivery of Selling Shareholder Underwritten Shares by it hereunder,
certificates representing such Shares shall be delivered by or on behalf of such
Selling Shareholder in accordance with the terms and conditions of this
Agreement and the Custody Agreement, and actions taken by the Attorneys-in-Fact
pursuant to the Powers of Attorney shall be as valid as if such death,
incapacity, termination, dissolution or other event had not occurred, regardless
of whether or not the Custodian, the Attorneys-in-Fact, or any of them, shall
have received notice of such death, incapacity, termination, dissolution or
other event.
5. (A) The Company covenants and agrees with each of the
several Underwriters as follows:
(a) to use its best efforts to cause the Registration
Statement to become effective at the earliest possible time and, if
required, to file the final Prospectus with the Commission within the
time periods specified by Rule 424(b) and Rule 430A under the
Securities Act and to file promptly all reports and any definitive
proxy or information statements required to be filed by the Company
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission thereunder (collectively, the "Exchange
Act") subsequent to the date of the Prospectus and for so long as the
delivery of a prospectus is required in connection with the offering or
sale of the Shares; and to furnish copies of the Prospectus to the
Underwriters in New York City prior to 10:00 a.m., New York City time,
on the Business Day next succeeding the date of this Agreement in such
quantities as the Representatives may reasonably request;
(b) to deliver, at the expense of the Company, to the
Representatives five signed copies of the Registration Statement (as
originally filed) and each amendment thereto, in each case including
exhibits, and to each other Underwriter a conformed copy of the
Registration Statement (as originally filed) and each amendment
thereto, in each case without exhibits and, during the period mentioned
in paragraph (e) below,
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to each of the Underwriters as many copies of the Prospectus (including
all amendments and supplements thereto) as the Representatives may
reasonably request;
(c) before filing any amendment or supplement to the
Registration Statement or the Prospectus, whether before or after the
time the Registration Statement becomes effective, to furnish to the
Representatives a copy of the proposed amendment or supplement for
review and not to file any such proposed amendment or supplement to
which the Representatives reasonably object;
(d) to advise the Representatives promptly, and to
confirm such advice in writing (i) when the Registration Statement has
become effective, (ii) when any amendment to the Registration Statement
has been filed or becomes effective, (iii) when any supplement to the
Prospectus or any amended Prospectus has been filed and to furnish the
Representatives with copies thereof, (iv) of any request by the
Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for any additional
information, (v) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of any
order preventing or suspending the use of any preliminary prospectus or
the Prospectus or the initiation or threatening of any proceeding for
that purpose, (vi) of the occurrence of any event, within the period
referenced in paragraph (e) below, as a result of which the Prospectus
as then amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in order to
make the statements therein, in the light of the circumstances when the
Prospectus is delivered to a purchaser, not misleading, and (vii) of
the receipt by the Company of any notification with respect to any
suspension of the qualification of the Shares for offer and sale in any
jurisdiction or the initiation or threatening of any proceeding for
such purpose; and to use its best efforts to prevent the issuance of
any such stop order, or of any order preventing or suspending the use
of any preliminary prospectus or the Prospectus, or of any order
suspending any such qualification of the shares, or notification of any
such order thereof and, if issued, to obtain as soon as possible the
withdrawal thereof;
(e) if, during such period of time after the first date
of the public offering of the Shares 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 sales by the Underwriters or any
dealer, any event shall occur as a result of which it is necessary to
amend or supplement the Prospectus in order to make the statements
therein, in light of the circumstances when the Prospectus is delivered
to a purchaser, not misleading, or if it is necessary to amend or
supplement the Prospectus to comply with law, forthwith to prepare and
furnish, at the expense of the Company, to the Underwriters
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and to the dealers (whose names and addresses the Representatives will
furnish to the Company) to which Shares may have been sold by the
Representatives on behalf of the Underwriters and to any other dealers
upon request, such amendments or supplements to the Prospectus as may
be necessary so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the
Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus will comply with law;
(f) to endeavor to qualify the Shares for offer and sale
under the securities or Blue Sky laws of such jurisdictions as the
Representatives shall reasonably request and to continue such
qualification in effect so long as reasonably required for distribution
of the Shares; provided that the Company shall not be required to file
a general consent to service of process in any jurisdiction;
(g) to make generally available to its security holders
and to the Representatives as soon as practicable an earnings statement
covering a period of at least twelve months beginning with the first
fiscal quarter of the Company occurring after the effective date of the
Registration Statement, which shall satisfy the provisions of Section
11(a) of the Securities Act and Rule 158 of the Commission promulgated
thereunder;
(h) so long as the Shares are outstanding, to furnish to
the Representatives copies of all reports or other communications
(financial or other) furnished to holders of the Shares, and copies of
any reports and financial statements furnished to or filed with the
Commission or any national securities exchange;
(i) for a period of 180 days after the date of the
Prospectus (the "Lock-Up Period") not to (i) offer, pledge, announce
the intention to sell, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant
any option, right or warrant to purchase or otherwise transfer or
dispose of, directly or indirectly, any shares of Common Stock or any
securities convertible into or exercisable or exchangeable for Common
Stock or (ii) enter into any swap or other agreement that transfers, in
whole or in part, any of the economic consequences of ownership of the
Common Stock, whether any such transaction described in clause (i) or
(ii) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise without the prior written consent of
the Representatives, other than the Shares to be sold by the Company
hereunder and any options granted or to be granted or shares of Common
Stock of the Company issued upon the exercise of options granted under
the Company's 1997 Equity Compensation Plan; notwithstanding the
foregoing, the Company may issue shares of its Common Stock during the
Lock-up Period in connection with acquisitions, strategic alliances or
joint ventures ("Excepted Transactions"); provided however, that (i)
the Company shall give X.X. Xxxxxx Securities Inc. 5 days prior written
notice of any such issuance describing the Excepted Transaction in
reasonable detail and stating the number of shares of Common Stock
proposed to be issued in the Excepted Transaction, (ii) all Common
Stock issued in connection with the Excepted Transaction shall remain
subject to the lock-up restrictions of this Paragraph 5(A)(i) for the
remainder of the Lock-up Period, (iii) prior to any such issuance of
Common Stock, each person that is to acquire any such Common Stock
shall sign a lock-up agreement in form and substance reasonably
acceptable to X.X. Xxxxxx Securities Inc. covering all such Common
Stock for the remainder of the Lock-up Period and (iv) no such issuance
shall be made unless and until the requirements and conditions in the
foregoing clauses (i) (ii) and (iii) have been complied with and
satisfied;
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(j) to use the net proceeds received by the Company from
the sale of the Shares by the Company pursuant to this Agreement in the
manner specified in the Prospectus under caption "Use of Proceeds";
(k) to use its best efforts to list for quotation the
Shares on the National Association of Securities Dealers Automated
Quotations National Market (the "Nasdaq National Market"); and
(l) whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or
cause to be paid all costs and expenses incident to the performance of
its obligations hereunder, including without limiting the generality of
the foregoing, all costs and expenses (i) incident to the preparation,
reregistration, transfer, execution and delivery of the Shares, (ii)
incident to the preparation, printing and filing under the Securities
Act of the Registration Statement, the Prospectus and any preliminary
prospectus (including in each case all exhibits, amendments and
supplements thereto), (iii) incurred in connection with the
registration or qualification of the Shares under the laws of such
jurisdictions as the Representatives may designate (including fees of
counsel for the Underwriters and its disbursements), (iv) in connection
with the listing of the Shares on the Nasdaq National Market, (v)
related to the filing with, and clearance of the offering by, the
National Association of Securities Dealers, Inc., (vi) in connection
with the printing (including word processing and duplication costs) and
delivery of this Agreement, the Preliminary and Supplemental Blue Sky
Memoranda and the furnishing to the Underwriters and dealers of copies
of the Registration Statement and the Prospectus, including mailing and
shipping, as herein provided, (vii) any expenses incurred by the
Company in connection with a "road show" presentation to potential
investors, (viii) the cost of preparing stock certificates and (ix) the
cost and charges of any transfer agent and any registrar.
(B) Each of the Selling Shareholders covenants and agrees
with each of the several Underwriters as follows:
(a) for a period of 180 days after the date of the
Prospectus not to (i) offer, pledge, announce to sell, sell, contract
to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase or
otherwise transfer or dispose of, directly or indirectly, any shares of
Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock or (ii) enter into any swap or other
agreement that transfers, in whole or in part, any of the economic
consequences of ownership of the Common Stock, whether any such
transaction described in clause (i) or (ii) above is to be settled by
delivery of Common Stock or such other securities, in cash or otherwise
or (iii) make any demand for or exercise any right with respect to the
registration of
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any shares of Common Stock or any security convertible into or
exercisable or exchangeable for Common Stock without the prior written
consent of the Representatives, in each case other than the Shares to
be sold by such Selling Shareholder hereunder; and
(b) to deliver to the Representatives prior to or at the
Closing Date a properly completed and executed United States Treasury
Department Form W-9 (or other applicable form or statement specified by
the Treasury Department regulations in lieu thereof) in order to
facilitate the Underwriters' documentation of their compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 with respect to the transactions herein
contemplated.
(C) The Representatives represent and agree that (i) they
have not offered or sold and, prior to the expiry of the period of six months
from the Closing Date, will not offer or sell, any Shares to persons in the
United Kingdom except persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (as principal or agent)
for the purposes of their businesses or otherwise in circumstances which have
not resulted and will not result in an offer to the public within the meaning of
the Public Offers of Securities Regulation 1995, (ii) they have complied and
will comply with all applicable provisions of the Financial Services Act of 1986
with respect to anything done by them in relation to the Common Stock in, form
or otherwise involving the United Kingdom and (iii) they have only issued or
passed on, and will only issue and pass on, in the United Kingdom any document
received by them in connection with the offering of the Common Stock to a person
who is of a kind described in Article 11(3) of the Financial Services Xxx 0000
(Investment Advertisement) (Exemptions) Order 1995 or is a person to whom such
document may otherwise lawfully be issued or passed on.
6. The several obligations of the Underwriters hereunder
to purchase the Shares on the Closing Date or the Additional Closing Date, as
the case may be, are subject to the performance by the Company and each of the
Selling Shareholders of their respective obligations hereunder and to the
following additional conditions:
(a) the Registration Statement shall have become
effective (or if a post-effective amendment is required to be filed
under the Securities Act, such post-effective amendment shall have
become effective) not later than 5:00 P.M., New York City time, on the
date hereof; and no stop order suspending the effectiveness of the
Registration Statement or any post-effective amendment shall be in
effect, and no proceedings for such purpose shall be pending before or
threatened by the Commission; the Prospectus shall have been filed with
the Commission pursuant to Rule 424(b) within the applicable time
period prescribed for such filing by the rules and regulations under
the Securities Act and in accordance with Section 5(a) hereof;
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and all requests for additional information shall have been complied
with to the satisfaction of the Representatives;
(b) the respective representations and warranties of the
Company and the Selling Shareholders contained herein are true and
correct on and as of the Closing Date or the Additional Closing Date,
as the case may be, as if made on and as of the Closing Date or the
Additional Closing Date, as the case may be, and each of the Company
and the Selling Shareholders shall have complied with all agreements
and all conditions on its part to be performed or satisfied hereunder
at or prior to the Closing Date or the Additional Closing Date, as the
case may be;
(c) subsequent to the execution and delivery of this
Agreement and prior to the Closing Date or the Additional Closing Date,
as the case may be, there shall not have occurred any downgrading, nor
shall any notice have been given of (i) any downgrading, (ii) any
intended or potential downgrading or (iii) any review or possible
change that does not indicate an improvement, in the rating accorded
any securities of or guaranteed by the Company by any "nationally
recognized statistical rating organization," as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act;
(d) since the respective dates as of which information is
given in the Prospectus there shall not have been any change in the
capital stock or long-term debt of the Company or any of its
subsidiaries or any Material Adverse Change, or any development
involving a prospective Material Adverse Change, otherwise than as set
forth or contemplated in the Prospectus, the effect of which in the
judgment of the Representatives makes it impracticable or inadvisable
to proceed with the public offering or the delivery of the Shares on
the Closing Date or the Additional Closing Date, as the case may be, on
the terms and in the manner contemplated in the Prospectus; and neither
the Company nor any of its subsidiaries has sustained since the date of
the latest audited financial statements included in the Prospectus any
material loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Prospectus;
(e) the Representatives shall have received (1) on and as
of the Closing Date or the Additional Closing Date, as the case may be,
a certificate of an executive officer of the Company, with specific
knowledge about the Company's financial matters, satisfactory to the
Representatives to the effect set forth in subsections (a) through (d)
(with respect to the respective representations, warranties, agreements
and conditions of the Company) of this Section and to the further
effect that there has not occurred any Material Adverse Change, or any
development involving a
19
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prospective Material Adverse Change from that set forth or contemplated
in the Registration Statement and (2) on and as of the Closing Date, a
certificate of the Selling Shareholders, satisfactory to the
Representatives to the effect set forth in subsection (b) of this
Section 6 (with respect to the respective representations, warranties,
agreements and conditions of the Selling Shareholders);
(f) Baker, Donelson, Bearman & Xxxxxxxx, counsel for the
Company, shall have furnished to the Representatives their written
opinion, dated the Closing Date or the Additional Closing Date, as the
case may be, in form and substance satisfactory to the Representatives,
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 its jurisdiction of incorporation, with power and
authority (corporate and other) to own its properties and
conduct its business as described in the Prospectus;
(ii) the Company has been duly qualified as a
foreign corporation for the transaction of business and is in
good standing under the laws of each other jurisdiction in
which it owns or leases properties, or conducts any business,
so as to require such qualification, other than where the
failure to be so qualified or in good standing would not have
a Material Adverse Effect;
(iii) each of the Company's subsidiaries has been
duly incorporated or organized and is validly existing as a
corporation under the laws of its jurisdiction of
incorporation or organization with power and authority
(corporate and other) to own its properties and conduct its
business as described in the Prospectus and has been duly
qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such qualification,
other than where the failure to be so qualified and in good
standing would not have a Material Adverse Effect; and all of
the outstanding shares of capital stock of each subsidiary
have been duly and validly authorized and issued, are fully
paid and non-assessable, and (except, in the case of foreign
subsidiaries, for directors' qualifying shares and except as
otherwise set forth in the Prospectus) are owned directly or
indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims;
(iv) other than as set forth or contemplated in
the Prospectus, there are no legal or governmental
investigations, actions, suits or proceedings pending or, to
the best of such counsel's knowledge, threatened against or
20
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affecting the Company or any of its subsidiaries or any of
their respective properties or to which the Company or any of
its subsidiaries is or may be a party or to which any property
of the Company or its subsidiaries is or may be the subject
which, if determined adversely to the Company or any of its
subsidiaries, could individually or in the aggregate have, or
reasonably be expected to have, a Material Adverse Effect; to
the best of such counsel's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or
threatened by others; and such counsel does not know of any
statutes, regulations, contracts or other documents that are
required to be described in the Registration Statement or
Prospectus or to be filed as exhibits to the Registration
Statement that are not described or filed as required;
(v) this Agreement has been duly authorized,
executed and delivered by the Company;
(vi) the authorized capital stock of the Company
conforms as to legal matters to the description thereof
contained in the Prospectus;
(vii) the shares of capital stock of the Company
outstanding prior to the issuance of the Shares to be sold by
the Company hereunder have been duly authorized and are
validly issued, fully paid and non-assessable;
(viii) the Shares to be issued and sold by the
Company hereunder have been duly authorized, and when
delivered to and paid for by the Underwriters in accordance
with the terms of this Agreement, will be validly issued,
fully paid and non-assessable and the issuance of such Shares
is not subject to any preemptive or similar rights;
(ix) the Common Stock conforms in all material
respects as to legal matters to the description thereof
contained in the Registration Statement and the Prospectus
under the heading "Description of Capital Stock." The
information in the Prospectus under the caption "Shares
Eligible for Future Sale," to the extent that it constitutes
matters of law or legal conclusions, has been reviewed by such
counsel, is correct in all material respects and presents
fairly the information required to be disclosed therein under
the 1933 Act and the 1933 Act Regulations;
(x) such counsel is of the opinion that the
Registration Statement and the Prospectus and any amendments
and supplements thereto (other than the financial statements
and related schedules therein, as to which such counsel need
express no opinion) comply as to form in all material respects
with
21
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the requirements of the Securities Act and believes that
(other than the financial statements and related schedules
therein, as to which such counsel need express no belief) the
Registration Statement and the prospectus included therein at
the time the Registration Statement became effective did not
contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and
that the Prospectus, as amended or supplemented, if
applicable, does not contain any untrue statement of a
material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(xi) neither the Company nor any of its
subsidiaries is, or with the giving of notice or lapse of time
or both would be, in violation of or in default under, its
certificate or articles of incorporation or by-laws or, to
such counsel's knowledge, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known
to such counsel to which the Company or any of its
subsidiaries is a party or by which it or any of them or any
of their respective properties is bound, except for violations
and defaults which individually and in the aggregate are not
material to the Company and its subsidiaries taken as a whole;
the issue and sale of the Shares being delivered on the
Closing Date or the Additional Closing Date, as the case may
be, to be sold by the Company hereunder and the performance by
the Company of its obligations under this Agreement and the
consummation of the transactions contemplated herein will not
conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument 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 the property
or assets of the Company or any of its subsidiaries is
subject, nor will any such action result in any violation of
the provisions of the certificate or articles of incorporation
or the by-laws of the Company or, to such counsel's knowledge,
any applicable law or statute or any order, rule or regulation
of any court or governmental agency or body having
jurisdiction over the Company, its subsidiaries or any of
their respective properties;
(xii) no consent, approval, authorization, order,
license, registration or qualification of or with any court or
governmental agency or body is required for the issuance by
the Company of the Shares to be sold by it hereunder or the
consummation by the Company of the other transactions
contemplated by this Agreement, except such consents,
approvals, authorizations, orders, licenses, registrations or
qualifications as have been obtained
22
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under the Securities Act and as may be required under state
securities or Blue Sky laws in connection with the purchase
and distribution of the Shares by the Underwriters;
(xiii) the Company is not and, after giving effect
to the offering and sale of the Shares, will not be an
"investment company" or entity "controlled" by an "investment
company", as such terms are defined in the Investment Company
Act;
(xiv) to such counsel's knowledge, each of the
Company and its subsidiaries owns, possesses or has obtained
all licenses, permits, certificates, consents, orders,
approvals and other authorizations from, and has made all
declarations and filings with, all federal, state, local and
other governmental authorities (including foreign regulatory
agencies), all self-regulatory organizations and all courts
and other tribunals, domestic or foreign, necessary to own or
lease, as the case may be, and to operate its properties and
to carry on its business as conducted as of the date hereof,
and neither the Company nor any such subsidiary has received
any actual notice of any proceeding relating to revocation or
modification of any such license, permit, certificate,
consent, order, approval or other authorization, except as
described in the Registration Statement and the Prospectus;
and, to such counsel's knowledge, each of the Company and its
subsidiaries is in compliance with all laws and regulations
relating to the conduct of its business as conducted as of the
date of the Prospectus;
(xv) to such counsel's knowledge, the Company and
its subsidiaries have good and marketable title in fee simple
to all real property and good and marketable title to all
personal property owned by them, in each case free and clear
of all liens, encumbrances and defects except such as are
described or referred to in the Prospectus or such as do not
materially affect the value of such property and do not
interfere with the use made and proposed to be made of such
property by the Company and its subsidiaries; and, to such
counsel's knowledge, any real property and buildings held
under lease by the Company and its subsidiaries are held by
them under valid, existing and enforceable leases with such
exceptions as are not material and do not interfere with the
use made or proposed to be made of such property and buildings
by the Company or its subsidiaries; and
(xvi) to such counsel's knowledge, each of the
Company and its subsidiaries is in compliance with all
Environmental Laws, except, in each case, where noncompliance,
individually or in the aggregate, would not have a Material
Adverse Effect; there are no legal or governmental proceedings
23
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pending or, to the knowledge of such counsel, threatened
against or affecting the Company or any of its subsidiaries
under any Environmental Law which, individually or in the
aggregate, could reasonably be expected to have a Material
Adverse Effect; and
(xvii) the Registration Statement has been declared
effective under Securities Act and, to such counsel's
knowledge, no stop order proceedings with respect thereto are
pending before or threatened by the Commission under the
Securities Act.
In rendering such opinions, such counsel may rely (A) as to
matters involving the application of laws other than the laws of the
United States and the State of Tennessee, to the extent such counsel
deems proper and to the extent specified in such opinion, if at all,
upon an opinion or opinions (in form and substance reasonably
satisfactory to Underwriters' counsel) of other counsel reasonably
acceptable to the Underwriters' counsel, familiar with the applicable
laws; (B) as to matters of fact, to the extent such counsel deems
proper, on certificates of responsible officers of the Company and
certificates or other written statements of officials of jurisdictions
having custody of documents respecting the corporate existence or good
standing of the Company. The opinion of such counsel for the Company
shall state that the opinion of any such other counsel upon which they
relied is in form satisfactory to such counsel and, in such counsel's
opinion, the Underwriters and they are justified in relying thereon.
With respect to the matters to be covered in subparagraphs (vi), (ix)
and (x) above counsel may state their opinion and belief is based upon
their participation in the preparation of the Registration Statement
and the Prospectus and any amendment or supplement thereto and review
and discussion of the contents thereof but is without independent check
or verification except as specified.
The opinion of Baker, Donelson, Bearman & Xxxxxxxx described
above shall be rendered to the Underwriters at the request of the
Company and shall so state therein;
(g) Holland & Knight LLP, counsel for the Selling
Shareholders, shall have furnished to the Representatives their written
opinion, dated the Closing Date, in form and substance satisfactory to
the Representatives, to the effect that:
(i) this Agreement has been duly authorized,
executed and delivered by or on behalf of each of the Selling
Shareholders;
(ii) a Power of Attorney and a Custody Agreement
have been duly authorized, executed and delivered by each
Selling Shareholder and constitute valid and binding
agreements of each Selling Shareholder in accordance with
their terms;
24
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(iii) each Selling Shareholder is the sole record
owner of all of the Selling Shareholder Underwritten Shares to
be sold by such Selling Shareholder, and upon the crediting of
the Selling Shareholder Underwritten Shares to the designated
Underwriters' accounts at the Depository Trust Company and
payment by X.X. Xxxxxx Securities, Inc., on behalf of the
Underwriters, for the Selling Shareholder Underwritten Shares,
no action based on an adverse claim to the Selling Shareholder
Underwritten Shares, may be asserted against the Underwriters,
assuming that the Underwriters acquire such Selling
Shareholder Underwritten Shares without notice of any adverse
claims; and
(iv) the sale of the Selling Shareholder
Underwritten Shares and the execution and delivery by the
Selling Shareholder of, and the performance by each of the
Selling Shareholders of its obligations under, this Agreement,
and the consummation of the transactions contemplated herein,
(i) have been duly authorized on the part of the Selling
Shareholders, and (ii) will not conflict with or result in a
breach of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan
agreement or other material agreement or instrument to which
any Selling Shareholder is a party or by which any Selling
Shareholder is bound or to which any of the property or assets
of any Selling Shareholder is subject, nor will any such
action result in any violation of any applicable law or
statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over such
Selling Shareholder or any of his properties of which such
counsel is aware; and no consent, approval, authorization,
order, registration or qualification of or with any such court
or governmental agency or body is required for the sale of
such Shares or the consummation by the Selling Shareholders of
the transactions contemplated by this Agreement, except such
consents, approvals, authorizations, registrations or
qualifications as have been obtained under the Securities Act
and as may be required under state securities or Blue Sky laws
in connection with the purchase and distribution of such
Shares by the Underwriters.
In rendering such opinions, such counsel may (A) assume as to
matters involving the application of the laws of New York or Tennessee
that such applicable laws are identical to those of Florida and rely as
to matters involving the application of laws other than the laws of the
United States and the State of Florida, to the extent such counsel
deems proper and to the extent specified in such opinion, if at all,
25
-25-
upon an opinion or opinions (in form and substance reasonably
satisfactory to Underwriters' counsel) of other counsel reasonably
acceptable to the Underwriters' counsel, familiar with the applicable
laws; (B) rely as to matters of fact, to the extent such counsel deems
proper, on certificates of responsible officers of the Company and
certificates or other written statements of officials of jurisdictions
having custody of documents respecting the corporate existence or good
standing of the Company. Such counsel may rely, without further
investigation, upon the representations and warranties of the Selling
Stockholders contained in their respective Custody Agreements and in
this Agreement, stating that nothing has come to such counsel's
attention that causes them to believe that they are not justified in
relying upon such representations and warranties. The opinion of such
counsel for the Selling Shareholders shall state that the opinion of
any such other counsel upon which they relied is in form satisfactory
to such counsel and, in such counsel's opinion, the Underwriters and
they are justified in relying thereon.
The opinion of Holland & Knight described above shall be
rendered to the Underwriters at the request of the Company and shall so
state therein;
(h) Banner & Wittcoff, special intellectual property
counsel for the Company, shall have furnished to the Representatives
their written opinion, dated the Closing Date or additional Closing
Date, as the case may be, in form and substance satisfactory to the
Representatives, to the effect that the Company and each of its
subsidiaries owns, is licensed to use or otherwise possesses adequate
rights to use the Intellectual Property reasonably necessary to carry
on the business conducted by it, except to the extent that the failure
to own, be licensed to use or otherwise possess adequate rights to use
such Intellectual Property would not have a Material Adverse Effect;
except as set forth in the Prospectus, the Company has not received any
notice of infringement of or conflict with, and to the best of the such
counsel's knowledge, there is no infringement of or conflict with,
asserted rights of others with respect to the Intellectual Property,
the discoveries, inventions, products or processes of the Company
referred to in the Registration Statement and the Prospectus do not, to
the best of such counsel's knowledge, infringe or conflict with any
right or patent of any third party, or any discovery, patent product or
process which is the subject of a patent application filed by any third
party; to the knowledge of such counsel, the Company and each of its
subsidiaries owns, is licensed to use or otherwise possesses adequate
rights to use patents and patent rights reasonably necessary to carry
on the business conducted by it;
(i) on the effective date of the Registration Statement
and the effective date of the most recently filed post-effective
amendment to the Registration Statement and also on the Closing Date or
Additional Closing Date, as the case may be,
26
-26-
PricewaterhouseCoopers shall have furnished to you letters, dated the
respective dates of delivery thereof, in form and substance
satisfactory to you, containing statements and information of the type
customarily included in accountants' "comfort letters" to underwriters
with respect to the financial statements and certain financial
information contained in the Registration Statement and the Prospectus;
(j) the Representatives shall have received on and as of
the Closing Date or Additional Closing Date, as the case may be, an
opinion of Xxxxxx Xxxxxx & Xxxxxxx, counsel to the Underwriters, with
respect to the due authorization and valid issuance of the Shares, the
Registration Statement, the Prospectus and other related matters as the
Representatives may reasonably request, and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters;
(k) the Shares to be delivered on the Closing Date or
Additional Closing Date, as the case may be, shall have been approved
for listing on the Nasdaq National Market, subject to official notice
of issuance;
(l) on or prior to the Closing Date or Additional Closing
Date, as the case may be, the Company and the Selling Shareholders
shall have furnished to the Representatives such further certificates
and documents as the Representatives shall reasonably request; and
(m) the Lock-Up Agreements shall be in full force and
effect on the Closing Date or Additional Closing Date, as the case may
be.
7. The Company agrees to indemnify and hold harmless
each Underwriter, each affiliate of any Underwriter which assists such
Underwriter in the distribution of the Shares and each person, if any, who
controls any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and all
losses, claims, damages and liabilities (including, without limitation, the
legal fees and other expenses incurred in connection with any suit, action or
proceeding or any claim asserted) caused by any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement or
the Prospectus (as amended or supplemented if the Company shall have furnished
any amendments or supplements thereto) or any preliminary prospectus, or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages or liabilities are caused by any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with information relating to any Underwriter
furnished to the Company in writing by such Underwriter through the
Representatives expressly for use therein.
27
-27-
Each of the Selling Shareholders agrees, severally and not
jointly, to indemnify and hold harmless each Underwriter and each person, if
any, who controls any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to information furnished to the Company in writing by or on behalf of
such Selling Shareholder expressly for use in the Registration Statement, the
Prospectus, any amendment and supplement thereto, or any preliminary prospectus;
provided, that the obligations of each Selling Shareholder under the foregoing
indemnity shall not exceed the net proceeds received by such Selling Shareholder
from the sale of the Shares sold by such Selling Shareholder hereunder.
Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its officers who sign
the Registration Statement and each person who controls the Company within the
meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act
and each of the Selling Shareholders to the same extent as the foregoing
indemnity from the Company and the Selling Shareholders to each Underwriter, but
only with reference to information relating to such Underwriter furnished to the
Company in writing by such Underwriter through the Representatives expressly for
use in the Registration Statement, the Prospectus, any amendment or supplement
thereto, or any preliminary prospectus.
If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any person in respect of which indemnity may be sought pursuant to the preceding
paragraphs of this Section 7, such person (the "Indemnified Person") shall
promptly notify the person or persons against whom such indemnity may be sought
(each an "Indemnifying Person") in writing, and such Indemnifying Persons, upon
request of the Indemnified Person, shall retain counsel reasonably satisfactory
to the Indemnified Person to represent the Indemnified Person and any others the
Indemnifying Persons may designate in such proceeding and shall pay the fees and
expenses of such counsel related to such proceeding. In any such proceeding, any
Indemnified Person shall have the right to retain its own counsel, but the fees
and expenses of such counsel shall be at the expense of such Indemnified Person
and not the Indemnifying Persons unless (i) the Indemnifying Persons and the
Indemnified Person shall have mutually agreed to the contrary, (ii) the
Indemnifying Persons has failed within a reasonable time to retain counsel
reasonably satisfactory to the Indemnified Person or (iii) the named parties in
any such proceeding (including any impleaded parties) include both an
Indemnifying Person and the Indemnified Person and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that no Indemnifying Person
shall, in connection with any proceeding or related proceeding in the same
jurisdiction, be liable for the fees and expenses of more than one separate firm
(in addition to any local counsel) for all Indemnified Persons, and that all
such fees and
28
-28-
expenses shall be reimbursed as they are incurred. Any such separate firm for
the Underwriters, each affiliate of any Underwriter which assists such
Underwriter in the distribution of the Shares and such control persons of
Underwriters shall be designated in writing by X.X. Xxxxxx Securities Inc. and
any such separate firm for the Company, its directors, its officers who sign the
Registration Statement and such control persons of the Company shall be
designated in writing by the Company and any such separate firm for the Selling
Shareholders shall be designated in writing by the Attorney-in-Fact. No
Indemnifying Person shall be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, each Indemnifying Person agrees to
indemnify any Indemnified Person from and against any loss or liability by
reason of such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time an Indemnified Person shall have requested an Indemnifying Person
to reimburse the Indemnified Person for fees and expenses of counsel as
contemplated by the second and third sentences of this paragraph, such
Indemnifying Person agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such Indemnifying Person of the
aforesaid request and (ii) such Indemnifying Person shall not have reimbursed
the Indemnified Person in accordance with such request prior to the date of such
settlement. No Indemnifying Person shall, without the prior written consent of
the Indemnified Person, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Person is or could have been a
party and indemnity could have been sought hereunder by such Indemnified Person,
unless such settlement includes an unconditional release of such Indemnified
Person from all liability on claims that are the subject matter of such
proceeding.
If the indemnification provided for in the first four
paragraphs of this Section 7 is unavailable to an Indemnified Person or
insufficient in respect of any losses, claims, damages or liabilities referred
to therein, then each Indemnifying Person under such paragraph, in lieu of
indemnifying such Indemnified Person thereunder, shall contribute to the amount
paid or payable by such Indemnified Person as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Selling Shareholders on the
one hand and the Underwriters on the other hand from the offering of the Shares
or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company and the Selling Shareholders on the one hand and the Underwriters on
the other hand in connection with the statements or omissions that resulted in
such losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Selling Shareholders on the one hand and the Underwriters on the other hand
shall be deemed to be in the same respective proportions as the net proceeds
from the offering (before deducting expenses) received by the Company and the
Selling Shareholders and the total underwriting discounts and the commissions
29
-29-
received by the Underwriters, in each case as set forth in the table on the
cover of the Prospectus, bear to the aggregate public offering price of the
Shares. The relative fault of the Company and the Selling Shareholders on the
one hand and the Underwriters on the other hand shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company and the Selling Shareholders or
by the Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company, the Selling Shareholders and the Underwriters
agree that it would not be just and equitable if contribution pursuant to this
Section 7 were determined by pro rata allocation (even if the Selling
Shareholders or the Underwriters were treated as one entity for such purposes)
or by any other method of allocation that does not take account of the equitable
considerations referred to in the immediately preceding paragraph. The amount
paid or payable by an Indemnified Person as a result of the losses, claims,
damages and liabilities referred to in the immediately preceding paragraph shall
be deemed to include, subject to the limitations set forth above, any legal or
other expenses incurred by such Indemnified Person in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 7, (i) in no event shall an Underwriter be required
to contribute any amount in excess of the amount by which the total price at
which the Shares underwritten by it and distributed to the public were offered
to the public exceeds the amount of any damages that such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission and (ii) in no event shall a Selling
Shareholder be required to contribute any amount in excess of the amount by
which the net proceeds received by it through the sale of its Shares to the
Underwriters exceeds the amount of any damages that such Selling Shareholder 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 ll(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations to contribute
pursuant to this Section 7 are several in proportion to the respective number of
Shares set forth opposite their names in Schedule I hereto, and not joint.
The remedies provided for in this Section 7 are not exclusive
and shall not limit any rights or remedies which may otherwise be available to
any indemnified party at law or in equity.
The indemnity and contribution agreements contained in this
Section 7 and the representations and warranties of the Company and the Selling
Shareholders set forth in this Agreement shall remain operative and in full
force and effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Underwriter
30
-30-
or any person controlling any Underwriter or by or on behalf of the Company, its
officers or directors or any other person controlling the Company or the Selling
Shareholders and (iii) acceptance of and payment for any of the Shares.
8. Notwithstanding anything herein contained, this Agreement (or
the obligations of the several Underwriters with respect to the Option Shares)
may be terminated in the absolute discretion of the Representatives, by notice
given to the Company and the Selling Shareholders, if after the execution and
delivery of this Agreement and prior to the Closing Date (or, in the case of the
Option Shares, prior to the Additional 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 or the American Stock Exchange, the National
Association of Securities Dealers, Inc., the Chicago Board Options Exchange, the
Chicago Mercantile Exchange or the Chicago Board of Trade, (ii) trading of any
securities of or guaranteed by 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 shall have been declared by either
Federal or New York State authorities, or (iv) there shall have occurred any
outbreak or escalation of hostilities or any change in financial markets or any
calamity or crisis that, in the judgment of the Representatives, is material and
adverse and which, in the judgment of the Representatives, makes it
impracticable to market the Shares being delivered at the Closing Date or the
Additional Closing Date, as the case may be, on the terms and in the manner
contemplated in the Prospectus.
9. This Agreement shall become effective upon the later of (x)
execution and delivery hereof by the parties hereto and (y) release of
notification of the effectiveness of the Registration Statement (or, if
applicable, any post-effective amendment) by the Commission.
If on the Closing Date or the Additional Closing Date, as the
case may be, any one or more of the Underwriters shall fail or refuse to
purchase Shares which it or they have agreed to purchase hereunder on such date,
and the aggregate number of 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 Shares to be purchased on such date, the other
Underwriters shall be obligated severally in the proportions that the number of
Shares set forth opposite their respective names in Schedule I bears to the
aggregate number of Underwritten Shares set forth opposite the names of all such
non-defaulting Underwriters, or in such other proportions as the Representatives
may specify, to purchase the Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date; provided
that in no event shall the number of Shares that any Underwriter has agreed to
purchase pursuant to Section 1 be increased pursuant to this Section 9 by an
amount in excess of one-ninth of such number of Shares without the written
consent of such Underwriter. If on the Closing Date or the Additional Closing
Date, as the case may be,
31
-31-
any Underwriter or Underwriters shall fail or refuse to purchase Shares which it
or they have agreed to purchase hereunder on such date, and the aggregate number
of Shares with respect to which such default occurs is more than one-tenth of
the aggregate number of Shares to be purchased on such date, and arrangements
satisfactory to the Representatives, the Company and the Selling Shareholders
for the purchase of such Shares are not made within 36 hours after such default,
this Agreement (or the obligations of the several Underwriters to purchase the
Option Shares, as the case may be) shall terminate without liability on the part
of any non-defaulting Underwriter, the Company or the Selling Shareholder. In
any such case either you or the Company and the Selling Shareholders shall have
the right to postpone the Closing Date (or, in the case of the Option Shares,
the Additional Closing Date), but in no event for longer than seven days, in
order that the required changes, if any, in the Registration Statement and in
the Prospectus or in 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 default of such Underwriter under this
Agreement.
10. If this Agreement shall be terminated by the Underwriters, or
any of them, because of any failure or refusal on the part of the Company or the
Selling Shareholders to comply with the terms or to fulfill any of the
conditions of this Agreement, or if for any reason any of the Company or the
Selling Shareholders shall be unable to perform its obligations under this
Agreement or any condition of the Underwriters' obligations cannot be fulfilled,
the Company and the Selling Shareholders agree to reimburse the Underwriters or
such Underwriters as have so terminated this Agreement with respect to
themselves, severally, for all out-of-pocket expenses (including the fees and
expenses of its counsel) reasonably incurred by the Underwriter in connection
with this Agreement or the offering contemplated hereunder.
11. This Agreement shall inure to the benefit of and be binding
upon the Company, the Selling Shareholders and the Underwriters, each affiliate
of any Underwriter which assists such Underwriter in the distribution of the
Shares, any controlling persons referred to herein and their respective
successors and assigns. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any other person, firm or corporation any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. No purchaser of Shares from any Underwriter
shall be deemed to be a successor by reason merely of such purchase.
12. Any action by the Underwriters hereunder may be taken by the
Representatives jointly or by X.X. Xxxxxx Securities Inc. alone on behalf of the
Underwriters, and any such action taken by the Representatives jointly or by
X.X. Xxxxxx Securities Inc. alone shall be binding upon the Underwriters. All
notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed or
32
-32-
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be given to the Representatives, c/o X.X. Xxxxxx Securities
Inc., 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (telefax: (000) 000-0000);
Attention: Syndicate Department. Notices to the Company and/or the Selling
Shareholders (through the Attorneys-in-Fact) shall be given to them at 0000
Xxxxxxxx Xxxx Xxxxx, Xxx Xxxxx, Xxxxxxxxx, (telefax: (000) 000-0000); Attention:
President, with a copy to Baker, Donelson, Bearman & Xxxxxxxx, 000 Xxxxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxxx 00000 (telefax: (000) 000-0000); Attention Xxxxxxx X.
Xxxxxx and, if to the Selling Shareholders, with a copy to Holland & Knight LLP,
000 Xxxxx Xxxxxx Xxxxx, Xxxxx 0000, Xxxxx Xxxxxxx 00000 (telefax (813)
229-0134); Attention Xxxxxx X. Xxxxxxx.
13. This Agreement may be signed in counterparts, each of which
shall be an original and all of which together shall constitute one and the same
instrument.
14. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE
CONFLICTS OF LAWS PROVISIONS THEREOF.
33
-33-
If the foregoing is in accordance with your understanding,
please sign and return four counterparts hereof.
Very truly yours,
Interactive Pictures Corporation
By:
------------------------------------
Name:
Title:
The Selling Shareholders
By:
------------------------------------
Name:
Title:
As Attorney-in-Fact acting on behalf of each
of the Selling Shareholders named in
Schedule II to this Agreement.
34
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Accepted: , 1999
X.X. XXXXXX SECURITIES INC.
XXXXXXXXX & XXXXX LLC
XXXXXX XXXXXX & COMPANY, INC.
XXXXXXXX INC.
Acting severally on behalf
of themselves and the
several Underwriters listed
in Schedule I hereto.
By: X.X. XXXXXX SECURITIES INC.
By: ------------------------------
Name:
Title:
35
SCHEDULE I
Number of Under-
written Shares
Underwriter To Be Purchased
----------- ---------------
X.X. Xxxxxx Securities Inc.......
Xxxxxxxxx & Xxxxx LLC............
Xxxxxx Xxxxxx & Company, Inc.....
Xxxxxxxx Inc.....................
------------
Total 4,200,000
============
36
SCHEDULE II
Number of
Selling Shareholders Underwritten Shares
-------------------- -------------------
H. Xxx Xxxxxx.................................. 300,000
Xxxxxx X. Xxxxx................................ 50,000
-------
Total.................... 350,000
=======
37
EXHIBIT A
LOCK-UP AGREEMENT
, 1999
X.X. XXXXXX SECURITIES INC.
XXXXXXXXX & XXXXX LLC
XXXXXX XXXXXX & COMPANY, INC.
XXXXXXXX INC.
As Representatives of the several
Underwriters named in Schedule I to
the Underwriting Agreement referred to below
c/o X.X. Xxxxxx Securities Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Interactive Pictures Corporation - Initial Public Offering
Ladies and Gentlemen:
The undersigned understands that you, as Representatives of
the several Underwriters, propose to enter into an Underwriting Agreement (the
"Underwriting Agreement") with Interactive Pictures Corporation, a Tennessee
corporation (the "Company"), providing for the initial public offering (the
"Public Offering") by the several Underwriters named in Schedule I to the
Underwriting Agreement (the "Underwriters"), of common stock, par value $.001
per share (the "Common Stock"), of the Company. Capitalized terms used herein
and not otherwise defined shall have the meanings set forth in the Underwriting
Agreement.
In consideration of the Underwriters' agreement to purchase
and make the Public Offering of the Common Stock, and for other good and
valuable consideration receipt of which is hereby acknowledged, the undersigned
hereby agrees that, without the prior written consent of X.X. Xxxxxx Securities
Inc. on behalf of the Underwriters, the undersigned will not, during the period
ending 180 days after the date of the prospectus relating to the Public Offering
(the "Prospectus"), (1) offer, pledge, announce the intention to sell, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase, or
otherwise transfer or dispose of, directly or indirectly, any shares of Common
Stock of the Company, or any securities of the Company which are substantially
similar to the Common Stock, or any securities convertible into or exercisable
or exchangeable for Common Stock (including, but not
38
limited to, Common Stock which may be deemed to be beneficially owned by the
undersigned in accordance with the rules and regulations of the Securities and
Exchange Commission and securities which may be issued upon exercise of a stock
option or warrant) or (2) enter into any swap, option, future, forward or other
agreement that transfers, in whole or in part, any of the economic consequences
of ownership of the Common Stock or any securities of the Company which are
substantially similar to the Common Stock, including, but not limited to, any
security convertible into or exercisable or exchangeable for Common Stock,
whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or such other securities, in cash or
otherwise. In addition, the undersigned agrees that, without the prior written
consent of X.X. Xxxxxx Securities Inc. on behalf of the Underwriters, it will
not, during the period ending 180 days after the date of the Prospectus, make
any demand for or exercise any right with respect to, the registration of any
shares of Common Stock or any substantially similar securities of the Company,
including but not limited to, any security convertible into or exercisable or
exchangeable for Common Stock.
In furtherance of the foregoing, the Company and any duly
appointed transfer agent for the registration or transfer of the securities
described herein are hereby authorized to decline to make any transfer of
securities if such transfer would constitute a violation or breach of this
Lock-Up Agreement.
The undersigned hereby represents and warrants that the
undersigned has full power and authority to enter into this Lock-up Agreement.
All authority herein conferred or agreed to be conferred and any obligations of
the undersigned shall be binding upon the successors, assigns, heirs or personal
representatives of the undersigned.
The undersigned understands that, if the Underwriting
Agreement does not become effective, or if the Underwriting Agreement (other
than the provisions thereof which survive termination) shall terminate or be
terminated prior to payment for and delivery of the Common Stock to be sold
thereunder, the undersigned shall be released from all obligations under this
Lock-Up Agreement.
The undersigned understands that the Underwriters are entering
into the Underwriting Agreement and proceeding with the Public Offering in
reliance upon this Lock-Up Agreement.
39
THIS LOCK-UP AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAWS PRINCIPLES THEREOF.
Very truly yours,
[ ]
By:
---------------------------
Name:
Title:
Accepted as of the date first set forth above:
X.X. XXXXXX SECURITIES INC.
XXXXXXXXX & XXXXX LLC
XXXXXX XXXXXX & COMPANY, INC.
XXXXXXXX INC.
Acting severally on behalf of themselves and the several Underwriters
named in Schedule I to the Underwriting Agreement
By: X.X. XXXXXX SECURITIES INC.
By:
----------------------------------
Name:
Title:
