OMEGA PROTEIN CORPORATION
8,000,000 Shares(1)
Common Stock
UNDERWRITING AGREEMENT
__________ __, 1998
PRUDENTIAL SECURITIES INCORPORATED
DEUTSCHE XXXXXX XXXXXXXX INC.
As Representatives of the several Underwriters
c/o Prudential Securities Incorporated
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Omega Protein Corporation, a Nevada corporation (the "Company"), and
Xxxxxx Corporation, a Delaware corporation (the "Selling Securityholder"),
hereby confirm their agreement with the several underwriters named in Schedule 1
hereto (the "Underwriters"), for whom you have been duly authorized to act as
representatives (in such capacities, the "Representatives"), as set forth below.
The Company is a wholly-owned subsidiary of the Selling Securityholder. If you
are the only Underwriters, all references herein to the Representatives shall be
deemed to be to the Underwriters.
1. Securities. Subject to the terms and conditions herein contained,
the Company proposes to issue and sell to the several Underwriters an aggregate
of 4,000,000 shares (the "Company Firm Securities") of the Company's Common
Stock, par value $.01 per share ("Common Stock"), and the Selling Securityholder
proposes to sell to the several Underwriters 4,000,000 authorized and
outstanding shares of Common Stock (the "Selling Securityholder Firm Securities"
and together with the Company Firm Securities, the "Firm Securities"). The
Company also proposes to issue and sell, and the Selling Securityholder proposes
to sell, to the several Underwriters not more than 1,200,000 additional shares
of Common Stock in the aggregate if requested by the Representatives as provided
in Section 3 of this Agreement. Any and all shares of Common Stock to be
purchased by the Underwriters pursuant to such options are referred to herein as
the "Option Securities," and the Firm Securities and any Option Securities are
collectively referred to herein as the "Securities".
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(1) Plus options to purchase from the Company and the Selling
Securityholder up to an aggregate of 1,200,000 additional shares to
cover over-allotments.
2. Representations and Warranties of the Company and the Selling
Securityholder. (a) The Company and the Selling Securityholder, jointly and
severally, represent and warrant to, and agree with, each of the several
Underwriters that:
(i) A registration statement on Form S-1 (File No. 333-44967) with
respect to the Securities, including a prospectus subject to completion, has
been filed by the Company with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Act"), and one
or more amendments to such registration statement may have been so filed. After
the execution of this Agreement, the Company will file with the Commission
either (A) if such registration statement, as it may have been amended, has been
declared by the Commission to be effective under the Act, either (1) if the
Company relies on Rule 434 under the Act, a Term Sheet (as hereinafter defined)
relating to the Securities, that shall identify the Preliminary Prospectus (as
hereinafter defined) that it supplements containing such information as is
required or permitted by Rules 434, 430A and 424(b) under the Act or (2) if the
Company does not rely on Rule 434 under the Act, a prospectus in the form most
recently included in an amendment to such registration statement (or, if no such
amendment shall have been filed, in such registration statement), with such
changes or insertions as are required by Rule 430A under the Act or permitted by
Rule 424(b) under the Act, and in the case of either clause (A)(1) or (A)(2) of
this sentence as have been provided to and approved by the Representatives prior
to the execution of this Agreement, or (B) if such registration statement, as it
may have been amended, has not been declared by the Commission to be effective
under the Act, an amendment to such registration statement, including a form of
prospectus, a copy of which amendment has been furnished to and approved by the
Representatives prior to the execution of this Agreement. The Company may also
file a related registration statement with the Commission pursuant to Rule
462(b) under the Act for the purpose of registering certain additional Common
Stock, which registration shall be effective upon filing with the Commission. As
used in this Agreement, the term "Original Registration Statement" means the
registration statement initially filed relating to the Securities, as amended at
the time when it was or is declared effective, including all financial schedules
and exhibits thereto and including any information omitted therefrom pursuant to
Rule 430A under the Act and included in the Prospectus (as hereinafter defined);
the term "Rule 462(b) Registration Statement" means any registration statement
filed with the Commission pursuant to Rule 462(b) under the Act (including the
Registration Statement and any Preliminary Prospectus or Prospectus incorporated
therein at the time such Registration Statement becomes effective); the term
"Registration Statement" includes both the Original Registration Statement and
any Rule 462(b) Registration Statement; the term "Preliminary Prospectus" means
each prospectus subject to completion filed with such registration statement or
any amendment thereto (including the prospectus subject to completion, if any,
included in the Registration Statement or any amendment thereto at the time it
was or is declared effective); the term "Prospectus" means:
(A) if the Company relies on Rule 434 under the Act, the Term Sheet
relating to the Securities that is first filed pursuant to Rule 424(b)(7)
under the Act,
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together with the Preliminary Prospectus
identified therein that such Term Sheet supplements;
(B) if the Company does not rely on Rule 434 under the Act, the
prospectus first filed with the Commission pursuant to Rule 424(b)
under the Act; or
(C) if the Company does not rely on Rule 434 under the Act and if no
prospectus is required to be filed pursuant to Rule 424(b) under the
Act, the prospectus included in the Registration Statement;
and the term "Term Sheet" means any term sheet that satisfies the requirements
of Rule 434 under the Act. Any reference herein to the "date" of a Prospectus
that includes a Term Sheet shall mean the date of such Term Sheet.
(ii) The Commission has not issued any order preventing or suspending
use of any Preliminary Prospectus. When any Preliminary Prospectus was filed
with the Commission it (A) contained all statements required to be stated
therein in accordance with, and complied in all material respects with the
requirements of, the Act and the rules and regulations of the Commission
thereunder and (B) did not include any 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 under which they were made, not
misleading. When the Registration Statement or any amendment thereto was or is
declared effective, it (A) contained or will contain all statements required to
be stated therein in accordance with, and complied or will comply in all
material respects with the requirements of, the Act and the rules and
regulations of the Commission thereunder and (B) did not or will not include any
untrue statement of a material fact or omit to state any material fact necessary
to make the statements therein not misleading. When the Prospectus or any Term
Sheet that is a part thereof or any amendment or supplement to the Prospectus is
filed with the Commission pursuant to Rule 424(b) (or, if the Prospectus or part
thereof or such amendment or supplement is not required to be so filed, when the
Registration Statement or the amendment thereto containing such amendment or
supplement to the Prospectus was or is declared effective) and on the Firm
Closing Date and any Option Closing Date (both as hereinafter defined), the
Prospectus, as amended or supplemented at any such time, (A) contained or will
contain all statements required to be stated therein in accordance with, and
complied or will comply in all material respects with the requirements of, the
Act and the rules and regulations of the Commission thereunder and (B) did not
or will not include any 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 under which they were made, not misleading. The foregoing
provisions of this paragraph (ii) do not apply to statements or omissions made
in any Preliminary Prospectus, the Registration Statement or any amendment
thereto or the Prospectus or any amendment or supplement thereto in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through the Representatives specifically for use therein.
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(iii) If the Company has elected to rely on Rule 462(b) and the Rule
462(b) Registration Statement has not been declared effective (A) the Company
has filed a Rule 462(b) Registration Statement in compliance with and that is
effective upon filing pursuant to Rule 462(b) and has received confirmation of
its receipt and (B) the Company has given irrevocable instructions for
transmission of the applicable filing fee in connection with the filing of the
Rule 462(b) Registration Statement, in compliance with Rule 111 promulgated
under the Act or the Commission has received payment of such filing fee.
(iv) The Company and each of its subsidiaries have been duly organized
and are validly existing as corporations in good standing under the laws of
their respective jurisdictions of incorporation and are duly qualified to
transact business as foreign corporations and are in good standing under the
laws of all other jurisdictions where the ownership or leasing of their
respective properties or the conduct of their respective businesses requires
such qualification, except where the failure to be so qualified would not
individually or in the aggregate have a material adverse effect, in the
condition (financial or otherwise), management, business prospects, net worth,
or results of the operations of the Company or any of its subsidiaries
("Material Adverse Effect"). As used herein, "subsidiary" means any entity in
which the Corporation owns in excess of 50% of such entity's equity.
(v) The Company and each of its subsidiaries have full power (corporate
and other) to own or lease their respective properties and conduct their
respective businesses as described in the Registration Statement and the
Prospectus or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus; and the Company has full power (corporate and other) to
enter into this Agreement and to carry out all the terms and provisions hereof
to be carried out by it.
(vi) The issued shares of capital stock of each of the Company's
subsidiaries have been duly authorized and validly issued, are fully paid and
nonassessable and are owned beneficially by the Company free and clear of any
security interests, liens, encumbrances, equities or claims, except for any
pledge of such capital stock to the Company's lender to secure the Company's
obligations under a revolving line of credit.
(vii) The Company has an authorized, issued and outstanding
capitalization as set forth in the Prospectus or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus. All of the issued shares of
capital stock of the Company, including the Selling Securityholder Firm
Securities and the Option Securities to be sold by the Selling Securityholder,
have been duly authorized and validly issued and are fully paid and
nonassessable. The Company Firm Securities and the Option Securities to be sold
by the Company have been duly authorized and at the Firm Closing Date, or the
Option Closing Date, as the case may be, after payment therefor in accordance
herewith, will be validly issued, fully paid and nonassessable. No holders of
outstanding shares of capital stock of the Company are entitled as such to any
preemptive or other rights to subscribe for any of the Securities, and no holder
of securities of the Company has any right which has not been fully exercised or
waived
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to require the Company to register the offer or sale of any securities
owned by such holder under the Act in the public offering contemplated by this
Agreement.
(viii) The capital stock of the Company conforms in all material
respects to the description thereof contained in the Prospectus or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus.
(ix) Except as disclosed in the Prospectus (or, if the Prospectus is
not in existence, the most recent Preliminary Prospectus), there are no
outstanding (A) securities or obligations of the Company or any of its
subsidiaries convertible into or exchangeable for any capital stock of the
Company or any such subsidiary, (B) warrants, rights or options to subscribe for
or purchase from the Company or any such subsidiary any such capital stock or
any such convertible or exchangeable securities or obligations, or (C)
obligations of the Company or any such subsidiary to issue any shares of capital
stock, any such convertible or exchangeable securities or obligations, or any
such warrants, rights or options.
(x) The consolidated financial statements and schedules of the Company
and its consolidated subsidiaries included in the Registration Statement and the
Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus) fairly present the financial position of the Company and
its consolidated subsidiaries and the results of operations and changes in
financial condition as of the dates and periods therein specified. Such
financial statements and schedules have been prepared in accordance with
generally accepted accounting principles consistently applied throughout the
periods involved (except as otherwise noted therein). The selected financial
data set forth under the caption "Selected Consolidated Financial Data" in the
Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus) fairly present, on the basis stated in the Prospectus
(or such Preliminary Prospectus), the information included therein. The pro
forma consolidated statement of operations data of the Company and its
consolidated subsidiaries together with the related notes thereto included under
the caption "Pro Forma Unaudited Consolidated Statement of Operations Data" and
elsewhere in the Registration Statement and the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus) present
fairly the information contained therein, have been prepared in accordance with
the Commission's rules and guidelines with respect to pro forma financial
statements and have been properly presented on the pro forma basis described
therein, and the assumptions used in the preparation thereof are reasonable and
the adjustments used therein are appropriate to give effect to the transactions
and circumstances referred to therein.
(xi) Coopers & Xxxxxxx L.L.P., who have certified certain financial
statements of the Company and its consolidated subsidiaries and delivered its
report with respect to the audited consolidated financial statements and
schedules included in the Registration Statement and the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus), are
independent public accountants as required by the Act and the applicable rules
and regulations thereunder.
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(xii) The execution and delivery of this Agreement have been duly
authorized by the Company and this Agreement has been duly executed and
delivered by the Company and is the valid and binding agreement of the Company
enforceable against the Company in accordance with its terms.
(xiii) The execution and delivery of the Services Agreement, the Tax
Indemnity Agreement, the Registration Rights Agreement and the Sublease
Agreement (collectively, the "Intercompany Agreements") have been duly
authorized by the Company and the Intercompany Agreements will be duly executed
and delivered by the Company on or prior to the Firm Closing Date, and will be
the valid and binding agreements of the Company enforceable against the Company
in accordance with their terms, except as rights to indemnification and
contribution under the Separation Agreement and the Registration Rights
Agreement may be limited by applicable law and except as the enforcement of any
such agreements may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles.
(xiv) No legal or governmental proceedings are pending to which the
Company or any of its subsidiaries is a party or to which the property of the
Company or any of its subsidiaries is subject that are required to be described
in the Registration Statement or the Prospectus and are not described therein
(or, if the Prospectus is not in existence, the most recent Preliminary
Prospectus), and no such proceedings have been threatened against the Company or
any of its subsidiaries or with respect to any of their respective properties;
and no contract or other document is required to be described in the
Registration Statement or the Prospectus or to be filed as an exhibit to the
Registration Statement that is not described therein (or, if the Prospectus is
not in existence, the most recent Preliminary Prospectus) or filed as required.
(xv) The issuance, offering and sale of the Company Firm Securities to
the Underwriters by the Company pursuant to this Agreement, the compliance by
the Company with the other provisions of this Agreement, the consummation of the
other transactions herein contemplated and the compliance by the Company with
the provisions of the Intercompany Agreements do not (A) require the consent,
approval, authorization, registration or qualification of or with any
governmental authority, except such as have been obtained, such as may be
required by the National Association of Securities Dealers, Inc. or under state
securities or blue sky laws and, if the registration statement filed with
respect to the Securities (as amended) is not effective under the Act as of the
time of execution hereof, such as may be required (and shall be obtained as
provided in this Agreement) under the Act, or (B) conflict with or result in a
breach or violation of any of the terms and provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, lease or other agreement
or instrument to which the Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries or any of their respective
properties are bound, or the charter documents or by-laws of the Company or any
of its subsidiaries, or any statute or any judgment, decree, order, rule or
regulation of any court or other governmental authority or any arbitrator
applicable to the Company or any of its subsidiaries.
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(xvi) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus or, if the Prospectus is
not in existence, the most recent Preliminary Prospectus, neither the Company
nor any of its subsidiaries has sustained any material loss or interference with
their respective businesses or properties from fire, flood, hurricane, accident
or other calamity, whether or not covered by insurance, or from any labor
dispute or any legal or governmental proceeding and there has not been any
material adverse change, or any development involving a prospective material
adverse change, in the condition (financial or otherwise), management, business
prospects, net worth, or results of the operations of the Company or any of its
subsidiaries, except in each case as described in or contemplated by the
Prospectus or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus.
(xvii) The Company has not, directly or indirectly, (A) taken any
action designed to cause or to result in, or that has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the
Securities or (B) since the filing of the Registration Statement (1) sold, bid
for, purchased, or paid anyone any compensation for soliciting purchases of, the
Securities or (2) paid or agreed to pay to any person any compensation for
soliciting another to purchase any other securities of the Company.
(xviii) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus (or, if the Prospectus is
not in existence, the most recent Preliminary Prospectus) and except for the
Intercompany Agreements, (A) the Company and its subsidiaries have not incurred
any material liability or obligation, direct or contingent not in the ordinary
course of business, nor entered into any material transaction not in the
ordinary course of business; (B) the Company has not purchased any of its
outstanding capital stock, nor declared, paid or otherwise made any dividend or
distribution of any kind on its capital stock; and (C) there has not been any
material change in the capital stock, short-term debt or long-term debt of the
Company and its consolidated subsidiaries, except in each case as described in
or contemplated by the Prospectus (or, if the Prospectus is not in existence,
the most recent Preliminary Prospectus).
(xix) The Company and each of its subsidiaries have good and marketable
title in fee simple to all items of real property and marketable title to all
personal property owned by each of them, in each case free and clear of any
security interests, liens, encumbrances, equities, claims and other defects,
except as described in or contemplated by the Prospectus (or if the Prospectus
is not in existence, the most recent Preliminary Prospectus) or as do not
materially and adversely 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 or such subsidiary, and any real property and buildings held under lease
by the Company or any such subsidiary are held under valid, subsisting 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 such
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subsidiary, in each case except as described in or contemplated by the
Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus).
(xx) No labor dispute with the employees of the Company or any of its
subsidiaries exists or is threatened or imminent that could result in a material
adverse change in the condition (financial or otherwise), business prospects,
net worth or results of operations of the Company and its subsidiaries, except
as described in or contemplated by the Prospectus (or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus).
(xxi) The Company and its subsidiaries own or possess, or can acquire
on reasonable terms, all material patents, patent applications, trademarks,
service marks, trade names, licenses, copyrights and proprietary or other
confidential information currently employed by them in connection with their
respective businesses, and neither the Company nor any such subsidiary has
received any notice of infringement of or conflict with asserted rights of any
third party with respect to any of the foregoing which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding, would
result in a material adverse change in the condition (financial or otherwise),
business prospects, net worth or results of operations of the Company and its
subsidiaries, except as described in or contemplated by the Prospectus (or, if
the Prospectus is not in existence, the most recent Preliminary Prospectus).
(xxii) The Company and each of its subsidiaries are insured by insurers
of recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which they are
engaged; neither the Company nor any such subsidiary has been refused any
insurance coverage sought or applied for; and neither the Company nor any such
subsidiary has any reason to believe that it will not be able to renew its
existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not materially and adversely affect the condition
(financial or otherwise), business prospects, net worth or results of operations
of the Company and its subsidiaries, except as described in or contemplated by
the Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus).
(xxiii) No subsidiary of the Company is currently prohibited, directly
or indirectly, from paying any dividends to the Company, from making any other
distribution on such subsidiary's capital stock, from repaying to the Company
any loans or advances to such subsidiary from the Company or from transferring
any of such subsidiary's property or assets to the Company or any other
subsidiary of the Company, except pursuant to the Company's agreements with
lenders providing to the Company revolving lines of credit or as described in
or contemplated by the Prospectus (or, if the Prospectus is not in existence,
the most recent Preliminary Prospectus).
(xxiv) The Company and its subsidiaries possess all certificates,
authorizations and permits issued by the appropriate federal, state or foreign
regulatory authorities
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necessary to conduct their respective businesses, and
neither the Company nor any such subsidiary has received any notice of
proceedings relating to the revocation or modification of any such certificate,
authorization or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a material adverse
change in the condition (financial or otherwise), business prospects, net worth
or results of operations of the Company and its subsidiaries, except as
described in or contemplated by the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus).
(xxv) The Company will conduct its operations in a manner that will not
subject it to registration as an investment company under the Investment Company
Act of 1940, as amended (the "Investment Company Act"), and this transaction
will not cause the Company to become an investment company subject to
registration under such Act.
(xxvi) Each of the Selling Securityholder, the Company and their
respective subsidiaries has filed all foreign, federal, state and local tax
returns that are required to be filed or has requested extensions thereof
(except in any case in which the failure so to file would not have a Material
Adverse Effect on the Company and its subsidiaries) and has paid all taxes
required to be paid by it and any other assessment, fine or penalty levied
against it, to the extent that any of the foregoing is due and payable, except
for any such assessment, fine or penalty that is currently being contested in
good faith or as described in or contemplated by the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus).
(xxvii) Neither the Company nor any of its subsidiaries is in violation
of any federal or state law or regulation relating to occupational safety and
health or to the storage, handling or transportation of hazardous or toxic
materials and the Company and its subsidiaries have received all permits,
licenses or other approvals required of them under applicable federal and state
occupational safety and health and environmental laws and regulations to conduct
their respective businesses, and the Company and each such subsidiary is in
compliance with all terms and conditions of any such permit, license or
approval, except any such violation of law or regulation, failure to receive
required permits, licenses or other approvals or failure to comply with the
terms and conditions of such permits, licenses or approvals which would not,
singly or in the aggregate, result in a Material Adverse Effect in the condition
(financial or otherwise), business prospects, net worth or results of operations
of the Company and its subsidiaries, except as described in or contemplated by
the Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus).
(xxviii) Each certificate signed by any officer of the Company and
delivered to the Representatives or counsel for the Underwriters shall be deemed
to be a representation and warranty by the Company to each Underwriter as to the
matters covered thereby.
(xxix) Except for the shares of capital stock of each of the
subsidiaries owned by the Company and such subsidiaries, neither the Company nor
any such subsidiary owns
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any shares of stock or any other equity securities of
any corporation or has any equity interest in any firm, partnership, association
or other entity, except as described in or contemplated by the Prospectus (or,
if the Prospectus is not in existence, the most recent Preliminary Prospectus).
(xxx) The Company and each of its subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (A)
transactions are executed in accordance with management's general or specific
authorizations; (B) transactions are recorded as necessary to permit preparation
of financial statements in conformity with generally accepted accounting
principles and to maintain asset accountability; (C) access to assets is
permitted only in accordance with management's general or specific
authorization; and (D) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(xxxi) No default exists, and no event has occurred which, with notice
or lapse of time or both, would constitute a default in the due performance and
observance of any term, covenant or condition of any indenture, mortgage, deed
of trust, lease or other agreement or instrument to which the Company or any of
its subsidiaries is a party or by which the Company or any of its subsidiaries
or any of their respective properties is bound or may be affected in any respect
with regard to property, business or operations of the Company and its
subsidiaries, except for such defaults which would not singly, or in the
aggregate, result in a Material Adverse Effect.
(xxxii) The Company has not distributed and, prior to the later of (A)
the Closing Date and (B) the completion of the distribution of the Securities,
will not distribute any offering material in connection with the offering and
sale of the Securities other than the Registration Statement or any amendment or
supplement thereto, and the Preliminary Prospectus or the Prospectus and any
amendment on supplement thereto or other materials, if any permitted by the Act.
(b) The Selling Securityholder represents and warrants to, and agrees
with, each of the several Underwriters that:
(i) The Selling Securityholder has full power (corporate and other) to
enter into this Agreement, to sell, assign, transfer and deliver to the
Underwriters the Securities to be sold by the Selling Securityholder hereunder
in accordance with the terms of this Agreement and the full power (corporate and
other) to enter into the Intercompany Agreements; and this Agreement has been
duly executed and delivered by the Selling Securityholder and constitutes the
legal, valid and binding agreement of the Selling Securityholder and the
Intercompany Agreements, upon execution and delivery thereof by the Company and
the Selling Securityholder will constitute the legal and valid binding
obligations of the Selling Securityholder, in each case enforceable in
accordance with their respective terms (except as rights to indemnification and
contribution under the Intercompany Agreements may be limited by applicable law,
and except as enforcement (i) may be limited by bankruptcy, insolvency,
reorganization or
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other similar laws affecting creditors' rights generally and (ii) is subject to
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law)).
(ii) The Selling Securityholder is the lawful owner of the Securities
to be sold by the Selling Securityholder hereunder and upon sale and delivery
of, and payment for, such Securities, as provided herein, the Selling
Securityholder will convey good and marketable title to such Securities, free
and clear of any security interests, liens, encumbrances, equities, claims or
other defects, assuming that the Underwriters have acquired such Securities
without notice of an adverse claim.
(iii) The Selling Securityholder has not, directly or indirectly, (A)
taken any action designed to cause or result in, or that has constituted or
which might reasonably be expected to constitute, the stabilization or
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Securities or (B) since the filing of the Registration
Statement (1) sold, bid for, purchased, or paid anyone any compensation for
soliciting purchases of, the Securities or (2) paid or agreed to pay to any
person any compensation for soliciting another to purchase any other securities
of the Company (except for the sale of Securities by the Selling Securityholder
under this Agreement).
(iv) To the extent that any statements or omissions are made in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
amendment or supplement thereto in reliance upon and in conformity with written
information furnished to the Company by the Selling Securityholder specifically
for use therein, such Preliminary Prospectus did, and the Registration Statement
and the Prospectus and any amendments or supplements thereto, when they become
effective or are filed with the Commission, as the case may be, will conform in
all material respects to the requirements of the Act, the Exchange Act and the
respective rules and regulations of the Commission thereunder and will not
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,
in the light of the circumstances under which they are made, not misleading. The
Selling Securityholder has reviewed the Prospectus (or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus) and the Registration
Statement, and the information regarding the Selling Securityholder set forth
therein under the caption "Principal and Selling Stockholder" is complete and
accurate.
(v) The sale of the Securities by the Selling Securityholder
pursuant hereto is not prompted by any adverse information concerning the
Company that is not set forth in the Registration Statement or the Prospectus
(or, if the Prospectus is not in existence, the most recent Preliminary
Prospectus).
(vi) The sale of the Securities to the Underwriters by the Selling
Securityholder pursuant to this Agreement, the compliance by the Selling
Securityholder with the other provisions of this Agreement, the consummation of
the
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other transactions herein contemplated and the compliance by the Selling
Securityholder with the provisions of the Intercompany Agreements do not (A)
require the consent, approval, authorization, registration or qualification of
or with any governmental authority, except such as have been obtained, such as
may be required under state securities or blue sky laws and, if the registration
statement filed with respect to the Securities (as amended) is not effective
under the Act as of the time of execution hereof, such as may be required (and
shall be obtained as provided in this Agreement) under the Act, or (B) conflict
with or result in a breach or violation of any of the terms and provisions of,
or constitute a default under any indenture, mortgage, deed of trust, lease or
other agreement or instrument to which the Selling Securityholder is a party or
by which the Selling Securityholder or any of the Selling Securityholder's
properties are bound, or any statute or any judgment, decree, order, rule or
regulation of any court or other governmental authority or any arbitrator
applicable to the Selling Securityholder.
(vii) The Securityholder has not distributed and, prior to the later of
(A) the Closing Date and (B) the completion of the distribution of the
Securities, will not distribute any offering material in connection with the
offering and sale of the Securities other than the Registration Statement or any
amendment thereto, and Preliminary Prospectus or the Prospectus or any amendment
or supplement thereto, or other materials, if any permitted by the Act.
(viii) The transactions contemplated hereby will not cause the Selling
Securityholder to become an investment company subject to the registration under
the Investment Company Act.
(ix) Each certificate signed by any officer of the Selling
Securityholder and delivered to the Representatives or counsel for the
Underwriters shall be deemed to be a representation and warranty by the Selling
Securityholder to each Underwriter as to the matters covered thereby.
3. Purchase, Sale and Delivery of the Securities. (a) On the basis of
the representations, warranties, agreements and covenants herein contained and
subject to the terms and conditions herein set forth, the Company agrees to
issue and sell the Company Firm Securities and the Selling Securityholder agrees
to sell the Selling Securityholder Securities to the Underwriters, and each of
the Underwriters, severally and not jointly, agrees to purchase from the Company
and the Selling Securityholder, at a purchase price of $________ per share, the
number of Firm Securities set forth opposite the name of such Underwriter in
Schedule 1 hereto. The number of Firm Securities to be purchased from the
Company and the Selling Securityholder, respectively (as adjusted by the
Representatives to avoid fractions), by each of the Underwriters shall be
determined by multiplying the aggregate number of such Firm Securities to
be sold by the Company or the Selling Securityholder, as the
case may be, by a fraction, the numerator of which is the number of Firm
Securities, set forth opposite the name of such Underwriter on Schedule 1 hereto
and the denominator of which is the total number of Firm Securities set forth on
Schedule 1 hereto. One or
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more certificates in definitive form for the Firm Securities that the several
Underwriters have agreed to purchase hereunder, and in such denomination or
denominations and registered in such name or names as the Representatives
request upon notice to the Company and the Selling Securityholder at least 48
hours prior to the Firm Closing Date, shall be delivered by or on behalf of the
Company and the Selling Securityholder to the Representatives for the respective
accounts of the Underwriters, against payment by or on behalf of the
Underwriters of the purchase price therefor by wire transfer in same-day funds
(the "Wired Funds") to the respective accounts of the Company and the Selling
Securityholder. Such delivery of and payment for the Firm Securities shall be
made at the offices of Fulbright & Xxxxxxxx L.L.P., 000 Xxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000 at 9:30 A.M., New York time, on __________, 1998, or at such
other place, time or date as the Representatives, the Company and the Selling
Securityholder may agree upon or as the Representatives may determine pursuant
to Section 9 hereof, such time and date of delivery against payment being herein
referred to as the "Firm Closing Date". Each of the Company and the Selling
Securityholder severally will make such certificate or certificates for the Firm
Securities available for checking and packaging by the Representatives at the
offices in New York, New York of the Company's transfer agent or registrar or of
Prudential Securities Incorporated at least 24 hours prior to the Firm Closing
Date.
(b) For the purpose of covering any over-allotments in connection with
the distribution and sale of the Firm Securities as contemplated by the
Prospectus, the Company and the Selling Securityholder hereby grant to the
several Underwriters options to purchase, severally and not jointly, the Option
Securities in the respective amounts of 600,000 shares and 600,000 shares. The
purchase price to be paid for any Option Securities shall be the same price per
share as the price per share for the Firm Securities set forth above in
paragraph (a) of this Section 3. The options granted hereby may be exercised as
to all or any part of the Option Securities from time to time within thirty (30)
days after the date of the Prospectus (or, if such 30th day shall be a Saturday
or Sunday or a holiday, on the next business day thereafter when the New York
Stock Exchange is open for trading). The Underwriters shall not be under any
obligation to purchase any of the Option Securities prior to the exercise of
such options. The Representatives may from time to time exercise the options
granted hereby by giving notice in writing or by telephone (confirmed in
writing) to the Selling Securityholder setting forth the aggregate number of
Option Securities as to which the several Underwriters are then exercising the
options and the date and time for delivery of and payment for such Option
Securities. Any such date of delivery shall be determined by the Representatives
but shall not be earlier than two business days or later than five business days
after such exercise of the options and, in any event, shall not be earlier than
the Firm Closing Date. The time and date set forth in such notice,
or such other time on such other date as the Representatives and the Selling
Securityholder may agree upon or as the Representatives may determine pursuant
to Section 9 hereof, is herein called the "Option Closing Date" with respect to
such Option Securities. Upon exercise of the options as provided herein, the
Company shall become obligated to issue and sell and the Selling Securityholder
shall become obligated to sell to each of the several Underwriters, and, subject
to the terms and conditions herein set
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forth, each of the Underwriters (severally and not jointly) shall become
obligated to purchase from the Company and the Selling Securityholder, the same
percentage of the total number of the Option Securities as to which the several
Underwriters are then exercising the options as such Underwriter is obligated to
purchase of the aggregate number of Firm Securities, as adjusted by the
Representatives in such manner as they deem advisable to avoid fractional
shares. Any partial exercise of the options granted hereby shall be made on a
pro rata basis in proportion to the respective maximum number of Option
Securities to be sold by each of the Company and the Selling Securityholder as
set forth herein. If the options are exercised as to all or any portion of the
Option Securities, one or more certificates in definitive form for such Option
Securities, and payment therefor, shall be delivered on the related Option
Closing Date in the manner, and upon the terms and conditions, set forth in
paragraph (a) of this Section 3, except that reference therein to the Firm
Securities and the Firm Closing Date shall be deemed, for purposes of this
paragraph (b), to refer to such Option Securities and Option Closing Date,
respectively.
(c) Each of the Company and the Selling Securityholder hereby
acknowledges that the wire transfer by or on behalf of the Underwriters of the
purchase price for any Securities does not constitute closing of a purchase and
sale of the Securities. Only execution and delivery of a receipt for Securities
by the Underwriters indicates completion of the closing of a purchase of the
Securities from the Company or the Selling Securityholder, as the case may be.
Furthermore, in the event that the Underwriters wire funds to the Company or the
Selling Securityholder prior to the completion of the closing of a purchase of
Securities, each of the Company and the Selling Securityholder hereby
acknowledges that until the Underwriters execute and deliver a receipt for the
Securities, by facsimile or otherwise, the Company or the Selling
Securityholder, as the case may be, will not be entitled to the wired funds and
shall return the wired funds to the Underwriters as soon as practicable (by wire
transfer of same-day funds) upon demand. In the event that the closing of a
purchase of Securities is not completed and the wire funds are not returned by
the Company or the Selling Securityholder, as the case may be, to the
Underwriters on the same day the wired funds were received by the Company or the
Selling Securityholder, as the case may be, each of the Company and the Selling
Securityholder agrees to pay to the Underwriters in respect of each day the wire
funds are not returned by it, in same-day funds, interest on the amount of such
wire funds in an amount representing the Underwriters' cost of financing as
reasonably determined by Prudential Securities Incorporated.
(d) It is understood that either of you, individually and not as
one of the Representatives, may (but shall not be obligated to) make payment on
behalf of any Underwriter or Underwriters for any of the Securities to be
purchased by such Underwriter or Underwriters. No such payment shall relieve
such Underwriter or Underwriters from any of its or their obligations hereunder.
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4. Offering by the Underwriters. Upon your authorization of the release
of the Firm Securities, the several Underwriters propose to offer the Firm
Securities for sale to the public upon the terms set forth in the Prospectus.
5. Covenants of the Company and the Selling Securityholder. (a) The
Company and the Selling Securityholder, jointly and severally, covenant
and agree with each of the Underwriters that:
(i) The Company and the Selling Securityholder will use their best
efforts to cause the Registration Statement, if not effective at the time of
execution of this Agreement, and any amendments thereto to become effective as
promptly as possible. If required, the Company will file the Prospectus or any
Term Sheet that constitutes a part thereof and any amendment or supplement
thereto with the Commission in the manner and within the time period required by
Rules 434 and 424(b) under the Act. During any time when a prospectus relating
to the Securities is required to be delivered under the Act, the Company (A)
will comply with all requirements imposed upon it by the Act and the rules and
regulations of the Commission thereunder to the extent necessary to permit the
continuance of sales of or dealings in the Securities in accordance with the
provisions hereof and of the Prospectus, as then amended or supplemented, and
(B) will not file with the Commission the Prospectus, Term Sheet or the
amendment referred to in the second sentence of Section 2(a)(i) hereof, any
amendment or supplement to such Prospectus, Term Sheet or any amendment to the
Registration Statement or any Rule 462(b) Registration Statement of which the
Representatives previously have been advised and furnished with a copy for a
reasonable period of time prior to the proposed filing and as to which filing
the Representatives shall not have given their consent. The Company will prepare
and file with the Commission, in accordance with the rules and regulations of
the Commission, promptly upon request by the Representatives or counsel for the
Underwriters, any amendments to the Registration Statement or amendments or
supplements to the Prospectus that may be necessary or advisable in connection
with the distribution of the Securities by the several Underwriters, and will
use its best efforts to cause any such amendment to the Registration Statement
to be declared effective by the Commission as promptly as possible. The Company
will advise the Representatives, promptly after receiving notice thereof, of the
time when the Registration Statement or any amendment thereto has been filed or
declared effective or the Prospectus or any amendment or supplement thereto has
been filed and will provide evidence satisfactory to the Representatives of each
such filing or effectiveness.
(ii) The Company will advise the Representatives, promptly after
receiving notice or obtaining knowledge thereof, of (A) the issuance by the
Commission of any stop order suspending the effectiveness of the Original
Registration Statement or any Rule 462(b) Registration Statement or any
amendment thereto or any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus or any amendment or supplement thereto,
(B) the suspension of the qualification of the Securities for offering or sale
in any jurisdiction, (C) the institution, threatening or contemplation of any
proceeding for any such purpose or (D) any request made by the
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Commission for amending the Original Registration Statement
or any Rule 462(b) Registration Statement, for amending or supplementing the
Prospectus or for additional information. The Company will use its best efforts
to prevent the issuance of any such stop order and, if any such stop order is
issued, to obtain the withdrawal thereof as promptly as possible.
(iii) The Company will cooperate with the Representatives and counsel
for the Underwriters for the qualification of the Securities for offering and
sale under (or obtain exemptions from the application of) the securities or blue
sky laws of such jurisdictions as the Representatives may designate and will
continue such qualifications in effect for as long as may be necessary to
complete the distribution of the Securities, provided, however, that in
connection therewith the Company shall not be required to qualify as a foreign
corporation, to execute a general consent to service of process in any
jurisdiction or take any action which would subject it to taxation as a foreign
corporation.
(iv) If, at any time prior to the later of (A) the final date when a
prospectus relating to the Securities is required to be delivered under the Act
or (B) the Option Closing Date, any event occurs as a result of which the
Prospectus, as then amended or supplemented, would include any untrue statement
of a material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, or if for any other reason it is necessary at any time to
amend or supplement the Prospectus to comply with the Act or the rules or
regulations of the Commission thereunder, the Company will promptly notify the
Representatives thereof and, subject to Section 5(a)(i) hereof, will prepare and
file with the Commission, at the Company's expense, an amendment to the
Registration Statement or an amendment or supplement to the Prospectus that
corrects such statement or omission or effects such compliance.
(v) The Company will, without charge, provide (A) to the
Representatives and to counsel for the Underwriters a signed copy of the
registration statement originally filed with respect to the Securities and each
amendment thereto (in each case including exhibits thereto) or any Rule 462(b)
Registration Statement, certified by the Secretary or an Assistant Secretary of
the Company to be true and complete copies thereof as filed with the Commission
by electronic transmission, (B) to each other Underwriter, a conformed copy of
such registration statement or any Rule 462(b) Registration Statement and each
amendment thereto (in each case without exhibits thereto) and (C) so long as a
prospectus relating to the Securities is required to be delivered under the Act,
as many copies of each Preliminary Prospectus or the Prospectus or any amendment
or supplement thereto as the Representatives may reasonably request; without
limiting the application of clause (C) of this sentence, the Company, not later
than (A) 6:00 PM, New York City time, on the date of determination of the public
offering price, if such determination occurred at or prior to 10:00 A.M., New
York City time, on such date or (B) 2:00 PM, New York City time, on the business
day following the date of determination of the public offering price, if such
determination occurred after 10:00 A.M., New York City time, on such date, will
deliver to the Underwriters,
-16-
without charge, as many copies of the Prospectus
and any amendment or supplement thereto as the Representatives may reasonably
request for purposes of confirming orders that are expected to settle on the
Firm Closing Date. The Company will provide or cause to be provided to each of
the Representatives, and to each Underwriter that so requests in writing, a copy
of each report on Form SR filed by the Company as required by Rule 463 under the
Act.
(vi) The Company, as soon as practicable, will make generally available
to its securityholders and to the Representatives a consolidated earnings
statement of the Company and its subsidiaries that satisfies the provisions of
Section 11(a) of the Act and Rule 158 thereunder.
(vii) The Company will apply the net proceeds from the sale of the
Securities as set forth under "Use of Proceeds" in the Prospectus.
(viii) Except pursuant to this Agreement, the Company will not,
directly or indirectly, without the prior written consent of Prudential
Securities Incorporated, on behalf of the Underwriters, offer, sell, offer to
sell, contract to sell, pledge, grant any option to purchase or otherwise sell
or dispose (or announce any offer, sale, offer of sale, contract of sale,
pledge, grant of any option to purchase or other sale or disposition) of any
shares of Common Stock or any securities convertible into, or exchangeable or
exercisable for, shares of Common Stock for a period of 180 days after the date
hereof, except (A) pursuant to this Agreement, (B) issuances pursuant to the
exercise of outstanding employee stock options, options granted under the
Company's stock option plans and outstanding warrants and (C) shares of Common
Stock issued in connection with the acquisition of certain entities, but only if
the holders of such shares, options or shares issued upon exercise of such
options or warrants, agree in writing not to sell, offer, dispose of or
otherwise transfer any such shares, options or warrants during the remainder of
the 180 day period without the prior written consent of Prudential Securities
Incorporated, on behalf of the Underwriters.
(ix) The Company will not, directly or indirectly, (A) take any action
designed to cause or to result in, or that has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the
Securities or (B) (1) sell, bid for, purchase, or pay anyone any compensation
for soliciting purchases of, the Securities or (2) pay or agree to pay to any
person any compensation for soliciting another to purchase any other securities
of the Company.
(x) The Company will obtain the agreements described in Section 7(h)
hereof prior to the Firm Closing Date.
(xi) If at any time during the 25-day period after the Registration
Statement becomes effective or the period prior to the Option Closing Date, any
rumor, publication or event relating to or affecting the Company shall occur as
a result of which in your reasonable opinion the market price of the Common
Stock has been or is likely to be
-17-
materially affected (regardless of whether such rumor, publication or event
necessitates a supplement to or amendment of the Prospectus), the Company
will, after notice from you advising the Company to the effect set forth
above, forthwith prepare, consult with you concerning the
substance of, and disseminate a press release or other public statement,
reasonably satisfactory to you, responding to or commenting on such rumor,
publication or event.
(xii) If the Company elects to rely on Rule 462(b), the Company shall
both file a Rule 462(b) Registration Statement with the Commission in compliance
with Rule 462(b) and pay the applicable fees in accordance with Rule 111
promulgated under the Act by the earlier of (A) 10:00 P.M. Eastern time on the
date of this Agreement and (B) the time confirmations are sent or given, as
specified by Rule 462(b)(2).
(xiii) The Company will cause the Securities to be listed on the New
York Stock Exchange (the "NYSE") prior to the commencement of the offering of
Securities. The Company will use its best efforts to ensure that the Securities
remain listed on the NYSE following the Firm Closing Date.
(b) The Selling Securityholder covenants and agrees with each of the
several Underwriters that:
(i) The Selling Securityholder will not, directly or indirectly, (A)
take any action designed to cause or result in, or that has constituted or which
might reasonably be expected to constitute, the stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale of the
Securities or (B) (1) sell, bid for, purchase, or pay anyone any compensation
for soliciting purchases of, the Securities or (2) pay or agree to pay to any
person any compensation for soliciting another to purchase any other securities
of the Company other than as provided by this Agreement.
(ii) The Selling Securityholder will not, directly or indirectly,
without the prior written consent of Prudential Securities Incorporated, offer,
sell, offer to sell, contract to sell, grant any option to purchase or otherwise
sell or dispose (or announce any offer, sale, offer of sale, contract of sale,
grant of any option to purchase or other sale or disposition) of any Securities
legally or beneficially owned by such Selling Securityholder or any securities
convertible into, or exchangeable or exercisable for, Securities for a period of
360 days after the date hereof, except pursuant to this Agreement.
(iii) As soon as the Selling Securityholder is advised thereof, the
Selling Securityholder will advise the Representatives (and immediately
thereafter confirm such advise in writing), (A) of receipt by the Selling
Securityholder or by any representative or agent of the Selling Securityholder,
of any communication from the Commission relating to the Registration Statement,
the Prospectus or any Preliminary Prospectus, or any notice or order of the
Commission relating to the Company or the Selling Securityholder in connection
with the transactions contemplated by this Agreement and
-18-
(B) of the happening of any event which makes or may make any
statement of a material fact made in the Registration Statement, the Prospectus
or any Preliminary Prospectus relating to the Selling Securityholder untrue or
that requires the making of any change in the Registration Statement, Prospectus
or Preliminary Prospectus, as the case may be, in order to make such statement,
in light of the circumstances in which it was made, not misleading.
(iv) For a period of 365 days after the date hereof, the Selling
Securityholder shall not effect a corporate dissolution or otherwise cease
operations.
6. Expenses. The Company will pay all costs and expenses incident to
the performance of its obligations under this Agreement, whether or not the
transactions contemplated herein are consummated or this Agreement is terminated
pursuant to Section 11 hereof, including all costs and expenses incident to (i)
the printing or other production of documents with respect to the transactions,
including any costs of printing the registration statement originally filed with
respect to the Securities and any amendment thereto, any Rule 462(b)
Registration Statement, any Preliminary Prospectus and the Prospectus and any
amendment or supplement thereto, this Agreement and any blue sky memoranda, (ii)
all arrangements relating to the delivery to the Underwriters of copies of the
foregoing documents, (iii) the fees and disbursements of the counsel, the
accountants and any other experts or advisors retained by the Company, (iv)
preparation, issuance and delivery to the Underwriters of any certificates
evidencing the Securities, including transfer agent's and registrar's fees, (v)
the qualification of the Securities under state securities and blue sky laws,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters relating thereto (which shall not exceed $7,500), (vi) the
filing fees of the Commission and the National Association of Securities
Dealers, Inc. relating to the Securities, (vii) any listing of the Securities on
the NYSE, (viii) any meetings with prospective investors in the Securities
(other than as shall have been specifically approved by the Representatives to
be paid for by the Underwriters), and (ix) advertising related to the offering
of the Securities (other than as shall have been specifically approved by the
Representatives to be paid for by the Underwriters). The Underwriters shall pay
their own expenses, including the fees and disbursements of Underwriters'
counsel (but excluding the fees and expenses described in clause (v) of the
preceding sentence; however, if the sale of the Securities provided for herein
is not consummated because any condition to the obligations of the Underwriters
set forth in Section 7 hereof is not satisfied, because this Agreement is
terminated pursuant to Section 11 hereof or because of any failure, refusal or
inability on the part of the Company or the Selling Securityholder to perform
all obligations and satisfy all conditions on their part to be performed or
satisfied hereunder other than by reason of a default by any of the
Underwriters, the Company will reimburse the Underwriters severally upon demand
for all out-of-pocket expenses (including counsel fees and
disbursements) that shall have been incurred by them in connection with the
proposed purchase and sale of the Securities. The Company shall not in any event
be liable to any of the Underwriters for the loss of anticipated profits from
the transactions covered by this Agreement. The provisions of this Section 6 are
intended to relieve the
-19-
Underwriters from payment of the costs and expenses
which the Company hereby agrees to pay and shall not affect any agreement
between the Company and the Selling Securityholder for the sharing of such costs
and expenses.
7. Conditions of the Underwriters' Obligations. The obligations of the
several Underwriters to purchase and pay for the Firm Securities shall be
subject, in the Representatives' sole discretion, to the accuracy of the
representations and warranties of the Company and the Selling Securityholder
contained herein as of the date hereof and as of the Firm Closing Date, as if
made on and as of the Firm Closing Date, to the accuracy of the statements of
the Company's officers made pursuant to the provisions hereof, to the
performance by the Company and the Selling Securityholder of their covenants and
agreements hereunder and to the following additional conditions:
(a) If the Original Registration Statement or any amendment thereto
filed prior to the Firm Closing Date has not been declared effective as of the
time of execution hereof, the Original Registration Statement or such amendment
and, if the Company has elected to rely upon Rule 462(b), the Rule 462(b)
Registration Statement shall have been declared effective not later than the
earlier of (i) 11:00 A.M., New York time, on the date on which the amendment to
the registration statement originally filed with respect to the Securities or to
the Registration Statement, as the case may be, containing information regarding
the initial public offering price of the Securities has been filed with the
Commission and (ii) the time confirmations are sent or given as specified by
Rule 462(b)(2), or with respect to the Original Registration Statement, or such
later time and date as shall have been consented to by the Representatives; if
required, the Prospectus or any Term Sheet that constitutes a part thereof and
any amendment or supplement thereto shall have been filed with the Commission in
the manner and within the time period required by Rules 434 and 424(b) under the
Act; no stop order suspending the effectiveness of the Registration Statement or
any amendment thereto shall have been issued, and no proceedings for that
purpose shall have been instituted or threatened or, to the knowledge of the
Company or the Representatives, shall be contemplated by the Commission; and the
Company shall have complied with any request of the Commission for additional
information (to be included in the Registration Statement or the Prospectus or
otherwise).
(b) The Representatives shall have received an opinion, dated the Firm
Closing Date, of Xxxxx, Oviatt, Gilman, Xxxxxxx & Xxxxxx, LLP, counsel for the
Company, to the effect that:
(i) the Company and each of its subsidiaries listed in Exhibit
21 to the Registration Statement (the "Subsidiaries") have been duly
organized and are validly existing as corporations in good standing
under the laws of their respective jurisdictions of incorporation and
are duly qualified to transact business as foreign corporations and are
in good standing under the laws of all other jurisdictions where the
ownership or leasing of their respective properties or the conduct of
their respective businesses requires such qualification, except where
the failure to be so qualified does not have a Material Adverse Effect;
-20-
(ii) the Company and each of the Subsidiaries have corporate
power to own or lease their respective properties and conduct their
respective businesses as described in the Registration Statement and
the Prospectus, and the Company has corporate power to enter into this
Agreement and to carry out all the terms and provisions hereof to be
carried out by it;
(iii) the issued shares of capital stock of each of the
Subsidiaries have been duly authorized and validly issued, are fully
paid and nonassessable and are owned beneficially by the Company free
and clear of any perfected security interests or, to the best knowledge
of such counsel, any other security interests, liens, encumbrances,
equities or claims, except for the pledge of such capital stock to the
Company's lender to secure the Company's obligations under its
revolving line of credit;
(iv) the Company has an authorized, issued and outstanding
capitalization as set forth under the heading "Capitalization" in the
Prospectus; all of the issued shares of capital stock of the Company,
including the Selling Securityholder Securities, have been duly
authorized and validly issued and are fully paid and nonassessable, to
such counsel's knowledge, have been issued in compliance with all
applicable federal and state securities laws and were not issued in
violation of or subject to any preemptive rights or other rights to
subscribe for or purchase securities; the Securities have been duly
authorized by all necessary corporate action of the Company and, the
Company Firm Securities when issued and delivered to and paid for by
the Underwriters pursuant to this Agreement, will be validly issued,
fully paid and nonassessable; the Company has been advised that the
Securities have been duly authorized for trading on the NYSE, subject
to official notice of issuance; no holders of outstanding shares of
capital stock of the Company are entitled as such to any preemptive or
other rights to subscribe for any of the Securities; and no holders of
securities of the Company are entitled to have such securities
registered under the Registration Statement;
(v) the statements set forth under the heading "Description of
Capital Stock" in the Prospectus, insofar as such statements purport to
summarize certain provisions of the capital stock of the Company,
provide a fair summary of such provisions; and the statements set forth
under the headings "Risk Factors - Government Regulation," "- Conflicts
of Interest,", "- Provisions with Anti-Takeover Effect" and - Shares
Eligible for Future Sale", "Business Insurance" and " - Regulation" and
"Description of Capital Stock" in the Prospectus, insofar as such
statements constitute a summary of the legal matters, documents or
proceedings referred to therein, provide a summary of such legal
matters, documents and proceedings in all material respects;
(vi) the execution and delivery of this Agreement have been
duly authorized by all necessary corporate action of the Company and
this Agreement has been duly executed and delivered by the Company;
-21-
(vii) the execution and delivery of the Intercompany
Agreements have been duly authorized by all necessary corporate action
of the Company and the Intercompany Agreements have been duly executed
and delivered by the Company and are the legal, valid, binding and
enforceable agreements of the Company except as to indemnification and
contribution obligations under the Separation Agreement and the
Registration Rights Agreement which may not be enforceable under
applicable law and subject to applicable bankruptcy, insolvency and
similar laws effecting creditors' rights generally, and subject, as to
enforceability, to general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or in law);
(viii) to the best knowledge of such counsel, (A) no legal or
governmental proceedings are pending to which the Company or any of the
Subsidiaries is a party or to which the property of the Company or any
of the Subsidiaries is subject that are required to be described in the
Registration Statement or the Prospectus and are not described therein
and no such proceedings have been threatened against the Company or any
of the Subsidiaries or with respect to any of their respective
properties and (B) no contract or other document is required to be
described in the Registration Statement or the Prospectus or to be
filed as an exhibit to the Registration Statement that is not described
therein or filed as required;
(ix) the issuance, offering and sale of the Securities to the
Underwriters by the Company pursuant to this Agreement, the compliance
by the Company with the other provisions of this Agreement, the
consummation of the other transactions herein contemplated and the
compliance by the Company with the terms of the Intercompany Agreements
do not (A) require the consent, approval, authorization, registration
or qualification of or with any governmental authority, except such as
have been obtained and such as may be required under state securities
or blue sky laws, or (B) conflict with or result in a breach or
violation of any of the terms and provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, lease or other
agreement or instrument, known to such counsel, to which the Company or
any of the Subsidiaries is a party or by which the Company or any of
the Subsidiaries or any of their respective properties are bound, or
the charter documents or by-laws of the Company or any of the
Subsidiaries, or any statute or any judgment, decree, order, rule or
regulation of any court or other governmental authority or any
arbitrator known to such counsel and applicable to the Company or
Subsidiaries;
(x) the Registration Statement is effective under the Act; any
required filing of the Prospectus, or any Term Sheet that constitutes a
part thereof, pursuant to Rules 434 and 424(b) has been made in the
manner and within the time period required by Rules 434 and 424(b); and
to the best of such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement or any amendment thereto
has been issued, and no proceedings for
-22-
that purpose have been instituted or threatened or, to the best
knowledge of such counsel, are contemplated by the Commission; and
(xi) the Registration Statement originally filed with respect
to the Securities and each amendment thereto, any Rule 462(b)
Registration Statement and the Prospectus (in each case, other than the
financial statements and other financial or accounting information
contained therein, as to which such counsel shall express no opinion)
comply as to form in all material respects with the applicable
requirements of the Act and the rules and regulations of the Commission
thereunder.
(xii) if the Company elects to rely on Rule 434, the
Prospectus is not "materially different", as such term is used in Rule
434, from the prospectus included in the Registration Statement at the
time of its effectiveness or an effective post-effective amendment
thereto (including such information that is permitted to be omitted
pursuant to Rule 430A).
Such counsel shall also state that they have no reason to believe that
the Registration Statement, as of its effective date, contained any untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements therein not misleading or
that the Prospectus, as of its date or the date of such opinion, included or
includes any untrue statement of a material fact or omitted or omits 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.
In rendering any such opinion, such counsel may rely, as to matters of
fact, to the extent such counsel deems proper, on certificates of responsible
officers of the Company and public officials. Such counsel may also state that
their opinions are limited in all respects to the laws of the State of New York,
the General Corporation Law of the State of Delaware, the laws of the State of
Nevada and applicable United States federal law, other than law pertaining to
the U.S. Food and Drug Administration, and that they have relied, insofar as the
laws of the State of Nevada are concerned, upon the opinion of Marshall, Hill,
Cassius and deLipkau.
References to the Registration Statement and the Prospectus in this
paragraph (b) shall include any amendment or supplement thereto at the date of
such opinion.
(c) The Selling Securityholder shall have furnished to the
Representatives the opinion of Xxxxx & Xxxxx, L.L.P., counsel for the Selling
Securityholder, dated the Closing Date, to the effect that:
(i) the Selling Securityholder has all requisite corporate
power to enter into this Agreement and the Tax Indemnity Agreement and
to sell, transfer and deliver the Selling Securityholder Securities in
the manner provided in this Agreement and to perform its obligations
under this Agreement and the Tax
-23-
Indemnity Agreement; this Agreement
has been duly executed and delivered by the Selling Securityholder, and
the Tax Indemnity Agreement, on or prior to the Firm Closing Date, will
be duly executed and delivered, and are the legal, valid, binding and
enforceable agreements of the Selling Securityholder, except as rights
to indemnity and contribution may be limited by applicable law or
public policy, and except as enforcement (i) may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting creditors' rights generally and (ii) is
subject to general principles of equity and public policy (regardless
of whether such enforceability is considered in a proceeding in equity
or at law);
(ii) upon the delivery by the Selling Securityholder to the
several Underwriters of certificates for the Securities being sold
hereunder by the Selling Securityholder against payment therefor as
provided herein, assuming that the Underwriters have purchased such
Securities in good faith and without "notice of an adverse claim"
(within the meaning of Article 8 of the Uniform Commercial Code of the
State of Nevada), the several Underwriters will acquire such Securities
free and clear of any "adverse claims" (within the meaning of Article 8
of the Uniform Commercial Code of the State of Nevada);
(iii) the sale of the Securities to the Underwriters by the
Selling Securityholder pursuant to this Agreement, the compliance by
the Selling Securityholder with the other provisions of this Agreement,
the consummation of the other transactions herein contemplated and the
compliance by the Selling Securityholder with the terms of the Tax
Indemnity Agreement do not (A) require the consent, approval,
authorization, registration or qualification of or with any
governmental authority of the United States, the State of Texas, the
State of New York or the State of Delaware, except such as have been
obtained and such as may be required under state securities or blue sky
laws, such as may be required under the Securities Act, the Exchange
Act or any applicable state or foreign securities or Blue Sky laws in
connection with the purchase and distribution of the Securities by the
Underwriters and the clearance of such offering with the NASD (as to
which we do not express an opinion) or such which, if not made or
obtained, would not reasonably be expected to adversely affect the
performance by the Selling Securityholder of its obligations under this
Agreement, or (B) result in a breach or violation of any of the terms
and provisions of, or constitute a default under any indenture,
mortgage, deed of trust, lease or other agreement or instrument to
which the Selling Securityholder is a party or by which the Selling
Securityholder or any of the Selling Securityholder's properties are
bound, other than any such breach or violation which would not
reasonably be expected to adversely affect the performance by the
Selling Securityholder of its obligations under this Agreement or (C)
violate any statute (or rule or regulation promulgated pursuant to any
such statute) of the United States, the State of Texas, the State of
New York or the State of Delaware (provided that such counsel need not
express any opinion with respect to compliance with any federal or
state securities law, rule or regulation) or, to
-24-
such counsel's knowledge, any judgment, decree or order of any court
or other governmental authority of the United States or the State of
Texas, the State of New York or the State of Delaware applicable to
the Selling Securityholder, other than any such violation which would
not reasonably be expected to adversely affect the performance by the
Selling Securityholder of its obligations under this Agreement.
In rendering such opinion, such counsel may rely, as to
matters of fact, on certificates of officers of the Company and public
officials. Such counsel may also state that their opinions are limited in all
respects to the laws of the State of Texas, the contract laws of the State of
New York, the General Corporation Law of the State of Delaware, the Uniform
Commercial Code of the State of Nevada (NRS 104) and applicable United States
federal law, and that they have relied, insofar as the laws of the State of
Nevada are concerned, upon the opinion of Marshall, Hill, Cassius and deLipkau.
References to the Registration Statement and the Prospectus in
this paragraph (c) shall include any amendment or supplement thereto at the date
of such opinion.
(d) The Representatives shall have received an opinion, dated the Firm
Closing Date, of Fulbright & Xxxxxxxx L.L.P., New York, New York, counsel for
the Underwriters, with respect to the issuance and sale of the Firm Securities,
the Registration Statement and the Prospectus, and such other related matters as
the Representatives may reasonably require, and the Company shall have furnished
to such counsel such documents as they may reasonably request for the purpose of
enabling them to pass upon such matters.
(e) The Representatives shall have received from Coopers & Xxxxxxx
L.L.P. a letter or letters dated, respectively, the date hereof and the Firm
Closing Date, in form and substance satisfactory to the Representatives, to the
effect that:
(i) they are independent accountants with respect to the
Company and its consolidated subsidiaries within the meaning of the Act
and the applicable rules and regulations thereunder;
(ii) in their opinion, the audited consolidated financial
statements and schedules examined by them and included in the
Registration Statement and the Prospectus comply in form in all
material respects with the applicable accounting requirements of the
Act and the related published rules and regulations;
(iii) on the basis of a reading of the latest available
interim unaudited consolidated financial statements of the Company and
its consolidated subsidiaries, carrying out certain specified
procedures (which do not constitute an examination made in accordance
with generally accepted auditing standards) that would not necessarily
reveal matters of significance with respect to the
-25-
comments set forth in this paragraph (iii), a reading of the minute
books of the stockholders, the board of directors and any committees
thereof of the Company and each of its consolidated subsidiaries, and
inquiries of certain officials of the Company and its consolidated
subsidiaries who have responsibility for financial and accounting
matters, nothing came to their attention that caused them to believe
that: (A) the unaudited consolidated financial statements of the
Company and its consolidated subsidiaries included in the Registration
Statement and the Prospectus do not comply in form in all material
respects with the applicable accounting requirements of the Act and the
related published rules and regulations thereunder or are not in
conformity with generally accepted accounting principles applied on a
basis substantially consistent with that of the audited consolidated
financial statements included in the Registration Statement and the
Prospectus; (B) at a specific date not more than five days prior to the
date of such letter, there were any changes in the capital stock or
long-term debt of the Company and its consolidated subsidiaries or any
decreases in net current assets or stockholders' equity of the Company
and its consolidated subsidiaries, in each case compared with amounts
shown on the December 31, 1997 unaudited consolidated balance sheet
included in the Registration Statement and the Prospectus, or for the
period from January 1, 1998 to such specified date total revenues,
gross profit, operating income, net income and income per share of the
Company and its consolidated subsidiaries were not at least ________%
of the comparable amounts for the comparable period in the prior year,
except in all instances for changes, decreases or increases set forth
in such letter;
(iv) they have carried out certain specified procedures, not
constituting an audit, with respect to certain amounts, percentages and
financial information that are derived from the general accounting
records of the Company and its consolidated subsidiaries and are
included in the Registration Statement and the Prospectus under the
captions "Prospectus Summary," "Risk Factors," "Company History and
Recent Transactions," "Use of Proceeds," "Dividend Policy,"
"Capitalization," "Dilution," "Selected Consolidated Financial Data,"
"Management's Discussion and Analysis of Financial Condition and
Results of Operations," "Business," "Management," "Certain Transactions
and Arrangements between the Company and Xxxxxx," "Principal and
Selling Stockholder," and "Description of Capital Stock," and in
Exhibit 11 to the Registration Statement, and have compared such
amounts, percentages and financial information with such records of the
Company and its consolidated subsidiaries and with information derived
from such records and have found them to be in agreement, excluding any
questions of legal interpretation; and
(v) on the basis of a reading of the unaudited pro forma
consolidated financial statements included in the Registration
Statement and the Prospectus, carrying out certain specified procedures
that would not necessarily reveal matters of significance with respect
to the comments set forth in this paragraph (v), inquiries of certain
officials of the Company and its consolidated subsidiaries
-26-
who have responsibility for financial and accounting matters and
proving the arithmetic accuracy of the application of the pro forma
adjustments to the historical amounts in the unaudited pro forma
consolidated financial statements, nothing came to their attention that
caused them to believe that the unaudited pro forma consolidated
condensed financial statements do not comply in form in all material
respects with the applicable accounting requirements of Rule 11-02 of
Regulation S-X or that the pro forma adjustments have not been properly
applied to the historical amounts in the compilation of such
statements.
In the event that the letters referred to above set forth any such
changes, decreases or increases, it shall be a further condition to the
obligations of the Underwriters that (A) such letters shall be accompanied by a
written explanation of the Company as to the significance thereof, unless the
Representatives deem such explanation unnecessary, and (B) such changes,
decreases or increases do not, in the sole judgment of the Representatives, make
it impractical or inadvisable to proceed with the purchase and delivery of the
Securities as contemplated by the Registration Statement, as amended as of the
date hereof.
References to the Registration Statement and the Prospectus in this
paragraph (e) with respect to either letter referred to above shall include any
amendment or supplement thereto at the date of such letter.
(f) The Representatives shall have received a certificate, dated the
Firm Closing Date, of the principal executive officer and the principal
financial or accounting officer of the Company to the effect that:
(i) the representations and warranties of the Company in this
Agreement are true and correct as if made on and as of the Firm Closing
Date; the Registration Statement, as amended as of the Firm Closing
Date, does not include any untrue statement of a material fact or omit
to state any material fact necessary to make the statements therein not
misleading, and the Prospectus, as amended or supplemented as of the
Firm Closing Date, does not include any 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 under which they
were made, not misleading; and the Company has performed all covenants
and agreements and satisfied all conditions on its part to be performed
or satisfied at or prior to the Firm Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement or any amendment thereto has been issued, and no
proceedings for that purpose have been instituted or threatened or, to
the best of the Company's knowledge, are contemplated by the
Commission; and
(iii) subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
neither the Company nor any of its subsidiaries has sustained any
material loss or interference with their
-27-
respective businesses or properties from fire, flood, hurricane,
accident or other calamity, whether or not covered by insurance, or
from any labor dispute or any legal or governmental proceeding, and
there has not been any material adverse change, or any development
involving a prospective material adverse change, in the condition
(financial or otherwise), management, business prospects, net worth or
results of operations of the Company or any of its subsidiaries, except
in each case as described in or contemplated by the Prospectus
(exclusive of any amendment or supplement thereto).
(g) The Representatives shall have received a certificate from the
Selling Securityholder, signed by the Selling Securityholder, dated the Closing
Date, to the effect that:
(i) the representations and warranties of the Selling
Securityholder in this Agreement are true and correct as if made on
and as of the Closing Date;
(ii) the Registration Statement, as amended as of the Closing
Date, does not include any untrue statement of a material fact or omit
to state any material fact necessary to make the statements therein not
misleading, and the Prospectus, as amended or supplemented as of the
Closing Date, does not include any 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 under which they
were made, not misleading; and
(iii) the Selling Securityholder has performed all covenants
and agreements on its part to be performed or satisfied at or prior to
the Closing Date.
(h) The Representatives shall have received from each person who is a
director or officer of the Company, who owns Common Stock (other than the
Selling Securityholder) or who has an option to acquire Common Stock an
agreement to the effect that such person will not, directly or indirectly,
without the prior written consent of Prudential Securities Incorporated, on
behalf of the Underwriters, offer, sell, offer to sell, contract to sell,
pledge, grant any option to purchase or otherwise sell or dispose (or announce
any offer, sale, offer of sale, contract of sale, pledge, grant of an option to
purchase or other sale or disposition) of any shares of Common Stock or any
securities convertible into, or exchangeable or exercisable for, shares of
Common Stock for a period of 180 days after the date of this Agreement.
(i) On or before the Firm Closing Date, the Representatives and counsel
for the Underwriters shall have received such further certificates, documents or
other information as they may have reasonably requested from the Company.
(j) Prior to the commencement of the offering of the Securities, the
Securities shall have been authorized for trading on the NYSE, subject to
official notice of issuance.
-28-
All opinions, certificates, letters and documents delivered pursuant to
this Agreement will comply with the provisions hereof only if they are
reasonably satisfactory in all material respects to the Representatives and
counsel for the Underwriters. The Company shall furnish to the Representatives
such conformed copies of such opinions, certificates, letters and documents in
such quantities as the Representatives and counsel for the Underwriters shall
reasonably request.
The respective obligations of the several Underwriters to purchase and
pay for any Option Securities shall be subject, in their discretion, to each of
the foregoing conditions to purchase the Firm Securities, except that all
references to the Firm Securities and the Firm Closing Date shall be deemed to
refer to such Option Securities and the related Option Closing Date,
respectively.
8. Indemnification and Contribution. (a) The Company and the Selling
Securityholder jointly and severally agree to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Securities Exchange Act of
1934 (the "Exchange Act"), against any losses, claims, damages or liabilities,
joint or several, to which such Underwriter or such controlling person may
become subject under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon:
(i) any untrue statement or alleged untrue statement made by
the Company or the Selling Securityholder in Section 2 of this
Agreement,
(ii) any untrue statement or alleged untrue statement of any
material fact contained in (A) the Registration Statement or any
amendment thereto, any Preliminary Prospectus or the Prospectus or any
amendment or supplement thereto or (B) any application or other
document, or any amendment or supplement thereto, executed by the
Company or the Selling Securityholder or based upon written information
furnished by or on behalf of the Company or the Selling Securityholder
filed in any jurisdiction in order to qualify the Securities under the
securities or blue sky laws thereof or filed with the Commission or any
securities association or securities exchange (each an "Application"),
(iii) the omission or alleged omission to state in the
Registration Statement or any amendment thereto, any Preliminary
Prospectus or the Prospectus or any amendment or supplement thereto, or
any Application a material fact required to be stated therein or
necessary to make the statements therein not misleading, or
(iv) any untrue statement or alleged untrue statement of any
material fact provided by the Company contained in any audio or visual
materials used in connection with the marketing of the Securities,
including without limitation, slides, videos, films, tape recordings
provided that such materials were approved for use by the Company,
-29-
and will reimburse, as incurred, each Underwriter and each such
controlling person for any legal or other expenses reasonably incurred by such
Underwriter or such controlling person in connection with investigating,
defending against or appearing as a third-party witness in connection with any
such loss, claim, damage, liability or action; provided, however, that the
Company and the Selling Securityholder will not be liable in any such case to
the extent that any such loss, claim, damage or liability arises out of or is
based upon any untrue statement or alleged untrue statement or omission or
alleged omission made in such registration statement or any amendment thereto,
any Preliminary Prospectus, the Prospectus or any amendment or supplement
thereto or any Application in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the
Representatives specifically for use therein; and provided, further, that the
Company and the Selling Securityholder will not be liable to any Underwriter or
any person controlling such Underwriter with respect to any such untrue
statement or omission made in any Preliminary Prospectus that is corrected in
the Prospectus (or any amendment or supplement thereto) if the person asserting
any such loss, claim, damage or liability purchased Securities from such
Underwriter but was not sent or given a copy of the Prospectus (as amended or
supplemented) at or prior to the written confirmation of the sale of such
Securities to such person in any case where such delivery of the Prospectus (as
amended or supplemented) is required by the Act, unless such failure to deliver
the Prospectus (as amended or supplemented) was a result of noncompliance by the
Company with Section 5(a)(iv) or 5(a)(v) of this Agreement. This indemnity
agreement will be in addition to any liability which the Company and the Selling
Securityholder may otherwise have.
The indemnifying party under this Section 8 shall not be liable for
any settlement of any proceeding effective without its written consent, but if
settled with such consent or if there be a final judgement for the plaintiff,
the indemnifying party agrees to indemnify the indemnified party against any
loss, claim, damage, liability or expense by reason of such settlement or
judgement. Neither the Company nor the Selling Securityholder will, without the
prior written consent of the Underwriter or Underwriters purchasing, in the
aggregate, more than fifty percent (50%) of the Securities, settle or compromise
or consent to the entry of any judgment in any pending or threatened claim,
action, suit or proceeding in respect of which indemnification may be sought
hereunder (whether or not any such Underwriter or any person who controls any
such Underwriter within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act is a party to such claim, action, suit or proceeding), unless
such settlement, compromise or consent includes an unconditional release of all
of the Underwriters and such controlling persons from all liability arising out
of such claim, action, suit or proceeding.
(b) Each Underwriter will, severally and not jointly, indemnify and
hold harmless the Company, each of its directors, each of its officers who
signed the Registration Statement, the Selling Securityholder and each person,
if any, who controls the Company or the Selling Securityholder within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act against any
losses, claims, damages or liabilities to which the Company, any such director
or officer of the Company, the Selling
-30-
Securityholder or any such controlling person of the Company or the Selling
Securityholder may become subject under the Act, the Exchange Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon (i) any untrue statement or alleged
untrue statement of any material fact contained in the Registration Statement or
any amendment thereto, any Preliminary Prospectus or the Prospectus or any
amendment or supplement thereto, or any Application or (ii) the omission or the
alleged omission to state therein a material fact required to be stated in the
Registration Statement or any amendment thereto, any Preliminary Prospectus or
the Prospectus or any amendment or supplement thereto, or any Application or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by any Underwriter
through the Representatives specifically for use therein; and, subject to the
limitation set forth immediately preceding this clause, will reimburse, as
incurred, any legal or other expenses reasonably incurred by the Company, any
such director, officer or controlling person or the Selling Securityholder in
connection with investigating or defending, settling, compromising or paying any
such loss, claim, damage, liability or any action in respect thereof. This
indemnity agreement will be in addition to any liability which each Underwriter
may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section 8
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party of the commencement thereof; but the
omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Section 8. In case any such action is brought against any indemnified party, and
it notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein and, to the extent that it may
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel satisfactory to such indemnified party;
provided, however, that if the defendants in any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be one or more legal defenses available
to it and/or other indemnified parties which are different from or additional to
those available to the indemnifying party, the indemnifying party shall not have
the right to direct the defense of such action on behalf of such indemnified
party or parties and such indemnified party or parties shall have the right to
select separate counsel to defend such action on behalf of such indemnified
party or parties. After notice from the indemnifying party to such indemnified
party of its election so to assume the defense thereof and approval by such
indemnified party of counsel appointed to defend such action, the indemnifying
party will not be liable to such indemnified party under this Section 8 for any
legal or other expenses, other than reasonable costs of investigation,
subsequently incurred by such indemnified party in connection with the defense
thereof, unless (i) the indemnified party shall have employed separate counsel
in accordance with the proviso to the next preceding sentence (it being
understood,
-31-
however, that in connection with such action the indemnifying party shall not be
liable for the expenses of more than one separate counsel (in addition to local
counsel) in any one action or separate but substantially similar actions in the
same jurisdiction arising out of the same general allegations or circumstances,
designated by the Representatives in the case of paragraph (a) of this Section
8, representing the indemnified parties under such paragraph (a) who are parties
to such action or actions) or (ii) the indemnifying party does not promptly
retain counsel satisfactory to the indemnified party or (iii) the indemnifying
party has authorized the employment of counsel for the indemnified party at the
expense of the indemnifying party. After such notice from the indemnifying party
to such indemnified party, the indemnifying party will not be liable for the
costs and expenses of any settlement of such action effected by such indemnified
party without the consent of the indemnifying party.
(d) In circumstances in which the indemnity agreement provided for in
the preceding paragraphs of this Section is unavailable or insufficient, for any
reason, to hold harmless an indemnified party in respect of any losses, claims,
damages or liabilities (or actions in respect thereof), each indemnifying party,
in order to provide for just and equitable contribution, shall contribute to the
amount paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect (i) the relative benefits received by
the indemnifying party or parties on the one hand and the indemnified party on
the other from the offering of the Securities or (ii) if the allocation provided
by the foregoing clause (i) is not permitted by applicable law, not only such
relative benefits but also the relative fault of the indemnifying party or
parties on the one hand and the indemnified party on the other in connection
with the statements or omissions or alleged statements or omissions that
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Selling Securityholder on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total proceeds from the offering (before deducting expenses) received by
the Company and the Selling Securityholder bear to the total underwriting
discounts and commissions received by the Underwriters. The relative fault of
the parties 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, the Selling Securityholder or the Underwriters, the parties' relative
intents, knowledge, access to information and opportunity to correct or prevent
such statement or omission, and any other equitable considerations appropriate
in the circumstances. The Company, the Selling Securityholder and the
Underwriters agree that it would not be equitable if the amount of such
contribution were determined by pro rata or per capita allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other method
of allocation that does not take into account the equitable considerations
referred to above in this paragraph (d). Notwithstanding any other provision of
this paragraph (d), no Underwriter shall be obligated to make contributions
hereunder that in the aggregate exceed the total public offering price of the
Securities purchased by such Underwriter under this Agreement, less the
aggregate amount of any
-32-
damages that such Underwriter has otherwise been required to pay in respect of
the same or any substantially similar claim, and no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute hereunder are
several in proportion to their respective underwriting obligations and not
joint, and contributions among Underwriters shall be governed by the provisions
of the Prudential Securities Incorporated Master Agreement Among Underwriters.
For purposes of this paragraph (d), each person, if any, who controls an
Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement and each person, if any, who controls the Company or the
Selling Securityholder within the meaning of Section 15 of the Act or Section 20
of the Exchange Act, shall have the same rights to contribution as the Company
or the Selling Securityholder, as the case may be.
(e) The liability of the Selling Securityholder under this Agreement
(including this Section 8) shall not exceed the initial public offering price of
the Securities sold by the Selling Securityholder to the Underwriters.
9. Default of Underwriters. If one or more Underwriters default in
their obligations to purchase Firm Securities or Option Securities hereunder and
the aggregate number of such Securities that such defaulting Underwriter or
Underwriters agreed but failed to purchase is ten percent or less of the
aggregate number of Firm Securities or Option Securities to be purchased by all
of the Underwriters at such time hereunder, the other Underwriters may make
arrangements satisfactory to the Representatives for the purchase of such
Securities by other persons (who may include one or more of the non-defaulting
Underwriters, including the Representatives), but if no such arrangements are
made by the Firm Closing Date or the related Option Closing Date, as the case
may be, the other Underwriters shall be obligated severally in proportion to
their respective commitments hereunder to purchase the Firm Securities or Option
Securities that such defaulting Underwriter or Underwriters agreed but failed to
purchase. If one or more Underwriters so default with respect to an aggregate
number of Securities that is more than ten percent of the aggregate number of
Firm Securities or Option Securities, as the case may be, to be purchased by all
of the Underwriters at such time hereunder, and if arrangements satisfactory to
the Representatives are not made within 36 hours after such default for the
purchase by other persons (who may include one or more of the non-defaulting
Underwriters, including the Representatives) of the Securities with respect to
which such default occurs, this Agreement will terminate without liability on
the part of any non-defaulting Underwriter or the Company other than as provided
in Section 10 hereof. In the event of any default by one or more Underwriters as
described in this Section 9, the Representatives shall have the right to
postpone the Firm Closing Date or the Option Closing Date, as the case may be,
established as provided in Section 3 hereof for not more than seven business
days in order that any necessary changes may be made in the arrangements or
documents for the purchase and delivery of the Firm Securities or
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Option Securities, as the case may be. As used in this Agreement, the term
"Underwriter" includes any person substituted for an Underwriter under this
Section 9. Nothing herein shall relieve any defaulting Underwriter from
liability for its default.
10. Survival. The respective representations, warranties, agreements,
covenants, indemnities and other statements of the Company, its officers, the
Selling Securityholder and the several Underwriters set forth in this Agreement
or made by or on behalf of them, respectively, pursuant to this Agreement shall
remain in full force and effect, regardless of (i) any investigation made by or
on behalf of the Company, any of its officers or directors, the Selling
Securityholder, any Underwriter or any controlling person referred to in Section
8 hereof and (ii) delivery of and payment for the Securities. The respective
agreements, covenants, indemnities and other statements set forth in Sections 6
and 8 hereof shall remain in full force and effect, regardless of any
termination or cancellation of this Agreement.
11. Termination. (a) This Agreement may be terminated with respect to
the Firm Securities or any Option Securities in the sole discretion of the
Representatives by notice to the Company and the Selling Securityholder given
prior to the Firm Closing Date or the related Option Closing Date, respectively,
in the event that the Company or the Selling Securityholder shall have failed,
refused or been unable to perform all obligations and satisfy all conditions on
its part to be performed or satisfied hereunder at or prior thereto or, if at or
prior to the Firm Closing Date or such Option Closing Date, respectively,
(i) the Company or any of its subsidiaries shall have, in the
sole judgment of the Representatives, sustained any material loss or
interference with their respective businesses or properties from fire,
flood, hurricane, accident or other calamity, whether or not covered by
insurance, or from any labor dispute or any legal or governmental
proceeding or there shall have been any material adverse change, or any
development involving a prospective material adverse change (including
without limitation a change in management or control of the Company),
in the condition (financial or otherwise), business prospects, net
worth or results of operations of the Company and its subsidiaries,
except in each case as described in or contemplated by the Prospectus
(exclusive of any amendment or supplement thereto);
(ii) trading in the Common Stock shall have been suspended by
the Commission or the NYSE or trading in securities generally on the
NYSE or the Nasdaq Stock Market's National Market shall have been
suspended or minimum or maximum prices shall have been established on
any such exchange or market system;
(iii) a banking moratorium shall have been declared by New
York or United States authorities; or
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(iv) there shall have been (A) an outbreak or escalation of
hostilities between the United States and any foreign power, (B) an
outbreak or escalation of any other insurrection or armed conflict
involving the United States or (C) any other calamity or crisis or
material adverse change in general economic, political or financial
conditions having an effect on the U.S. financial markets that, in the
sole judgment of the Representatives, makes it impractical or
inadvisable to proceed with the public offering or the delivery of the
Securities as contemplated by the Registration Statement, as amended as
of the date hereof.
(b) Termination of this Agreement pursuant to this Section 11 shall be
without liability of any party to any other party except as provided in Section
10 hereof.
12. Information Supplied by Underwriters. The statements set forth in
the last paragraph on the front cover page and under the heading "Underwriting"
in any Preliminary Prospectus or the Prospectus (to the extent such statements
relate to the Underwriters) constitute the only information furnished by any
Underwriter through the Representatives to the Company for the purposes of
Sections 2(a)(ii) and 8 hereof. The Underwriters confirm that such statements
(to such extent) are correct.
13. Notices. All communications hereunder shall be in writing and, if
sent to any of the Underwriters, shall be delivered or sent by mail, telex or
facsimile transmission and confirmed in writing to Prudential Securities
Incorporated, Xxx Xxx Xxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Equity
Transactions Group; and if sent to the Company or the Selling Securityholder,
shall be delivered or sent by mail, telex or facsimile transmission and
confirmed in writing to the Company and separately to the Selling Securityholder
at 0000 Xx. Xxxxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000, Attention: Chief
Executive Officer.
14. Successors. This Agreement shall inure to the benefit of and shall
be binding upon the several Underwriters, the Company, the Selling
Securityholder and their respective successors and legal representatives, and
nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any other person any legal or equitable right, remedy or claim
under or in respect of this Agreement, or any provisions herein contained, this
Agreement and all conditions and provisions hereof being intended to be and
being for the sole and exclusive benefit of such persons and for the benefit of
no other person except that (i) the indemnities of the Company and the Selling
Securityholder contained in Section 8 of this Agreement shall also be for the
benefit of any person or persons who control any Underwriter within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act and (ii) the
indemnities of the Underwriters contained in Section 8 of this Agreement shall
also be for the benefit of the directors of the Company, the officers of the
Company who have signed the Registration Statement and any person or persons who
control the Company within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act and the Selling Securityholder. No purchaser of Securities from
any Underwriter shall be deemed a successor because of such purchase.
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15. Applicable Law. The validity and interpretation of this Agreement,
and the terms and conditions set forth herein, shall be governed by and
construed in accordance with the laws of the State of New York, without giving
effect to any provisions relating to conflicts of laws.
16. Consent to Jurisdiction and Service of Process. All judicial
proceedings arising out of or relating to this Agreement may be brought in any
state or federal court of competent jurisdiction in the State of New York, and
by execution and delivery of this Agreement, each of the Company and the Selling
Securityholder accepts for itself and in connection with its properties,
generally and unconditionally, the nonexclusive jurisdiction of the aforesaid
courts and waives any defense of forum non conveniens and irrevocably agrees to
be bound by any judgment rendered thereby in connection with this Agreement.
Each of the Company and the Selling Securityholder designates and appoints
Xxxx X. Xxxxxx and The Corporation Trust Company, respectively, and such
other persons as may hereafter be selected by the Company or the Selling
Securityholder irrevocably agreeing in writing to so serve, as its agent
to receive on its behalf service of all process in any such proceedings
in any such court, such service being hereby acknowledged by the Company
and the Selling Securityholder to be effective and binding service in
every respect. A copy of any such process so served shall be mailed by
registered mail to the Company and the Selling Securityholder at its address
provided in Section 13 hereof; provided, however, that, unless otherwise
provided by applicable law, any failure to mail such copy shall not affect the
validity of service of such process. If any agent appointed by the Company or
the Selling Securityholder refuses to accept service, each of the Company and
the Selling Securityholder hereby agrees that service of process sufficient for
personal jurisdiction in any action against the Company or the Selling
Securityholder in the State of New York may be made by registered or certified
mail, return receipt requested, to the Company or the Selling Securityholder at
its address provided in Section 13 hereof, and the Company and the Selling
Securityholder hereby acknowledges that such service shall be effective and
binding in every respect. Nothing herein shall affect the right to serve process
in any other manner permitted by law or shall limit the right of any Underwriter
to bring proceedings against the Company or the Selling Securityholder in the
courts of any other jurisdiction.
17. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
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If the foregoing correctly sets forth our understanding, please
indicate your acceptance thereof in the space provided below for that purpose,
whereupon this letter shall constitute an agreement binding the Company and each
of the several Underwriters. It is understood that your acceptance of this
Agreement on behalf of each of the Underwriters is pursuant to the authority
granted to you by them, severally, in the Agreement among Underwriters, a copy
of which will be given to the Company upon its request.
Very truly yours,
OMEGA PROTEIN CORPORATION
By
______________________________________
[Title]
XXXXXX CORPORATION
By
______________________________________
[Title]
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
PRUDENTIAL SECURITIES INCORPORATED
DEUTSCHE XXXXXX XXXXXXXX INC.
By PRUDENTIAL SECURITIES INCORPORATED
By _____________________
Xxxx-Xxxxxx Canfin
Managing Director
For itself and on behalf of the Representatives.
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SCHEDULE 1
UNDERWRITERS
================================================================================
Number of Firm
Securities to be
Underwriter Purchased
----------- ---------
--------------------------------------------------------------------------------
Prudential Securities Incorporated . . .
--------------------------------------------------------------------------------
Deutsche Xxxxxx Xxxxxxxx Inc. . . . . .
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total . . . . . __________________
8,000,000
================================================================================
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