EXHIBIT 1.01
Draft 10/17/96
2,000,000 Shares
VIVID TECHNOLOGIES, INC.
Common Stock
U.S. UNDERWRITING AGREEMENT
---------------------------
______ ___,1996
XXXXXX BROTHERS INC.
XXXXX & COMPANY
XXXXXXX & COMPANY, INC.
As Representatives of the several
U.S. Underwriters named in Schedule 1,
c/x Xxxxxx Brothers Inc.
Three World Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Vivid Technologies, Inc., a Delaware corporation (the "Company"),
proposes to sell an aggregate of __________ shares (the "Firm Stock") of the
Company's Common Stock, par value $.01 per share (the "Common Stock"). In
addition, the Company proposes to grant to the Underwriters named in Schedule I
hereto (the "Underwriters") an option to purchase up to an additional _________
shares of the Common Stock on the terms and for the purposes set forth in
Section 2 (the "Option Stock"). The Firm Stock and the Option Stock, if
purchased, are hereinafter collectively called the "Stock." This is to confirm
the agreement concerning the purchase of the Stock from the Company by the
Underwriters.
It is understood by all parties that the Company is concurrently
entering into an agreement dated the date hereof (the "International
Underwriting Agreement") providing for the sale by the Company of an aggregate
of ________ shares of Common Stock (including the over-allotment option
thereunder) (the "International Stock") through arrangements with certain
underwriters outside the United States (the "International Managers"), for whom
Xxxxxx Brothers International (Europe), Xxxxx & Company and Xxxxxxx & Company,
Inc. are acting as lead managers (the "Lead Managers"). The U.S. Underwriters
and the International Managers simultaneously are entering into an agreement
between the U.S. and International underwriting syndicates (the "Agreement
Between U.S. Underwriters and International Managers") which provides for, among
other things, the transfer of shares of Common Stock between the two syndicates.
Two forms of prospectus are to be used in connection with the offer and sale of
shares of Common Stock contemplated by the foregoing, one relating to the Stock
and the other relating to the International Stock. The latter form of
prospectus will be identical to the former
except for certain substitute pages as included in the registration statement
and amendments thereto referred to below. Except as used in the first paragraph
hereof and in Sections 2, 3, 4, 9 and 10 herein, and except as the context may
otherwise require, references herein to the Stock shall include all the shares
of the Common Stock which may be sold pursuant to either this Agreement or the
International Underwriting Agreement, and references herein to any prospectus
whether in preliminary or final form, and whether as amended or supplemented,
shall include both the U.S. and the international versions thereof.
1. Representations, Warranties and Agreements of the
Company. The Company represents, warrants and agrees that:
(a) Each of the registration statement on Form S-1, and any
registration statement filed pursuant to Rule 462(b) of the Rules and
Regulations (as hereinafter defined), and any amendments thereto, with
respect to the Stock has (i) been prepared by the Company in conformity
with the requirements of the United States Securities Act of 1933 (the
"Securities Act") and the rules and regulations (the "Rule and
Regulations") of the United States Securities and Exchange Commission (the
"Commission") thereunder, (ii) been filed with the Commission under the
Securities Act and (iii) become effective under the Securities Act. Copies
of each of such registration statement, including any registration
statement filed pursuant to Rule 462(b), and the amendments thereto have
been delivered by the Company to you as the representatives (the
"Representatives") of the Underwriters and such copies, to the extent
applicable, were identical to the electronically transmitted copies thereof
filed with the Commission pursuant to the Commission's Electronic Data
Gathering, Analysis and Retrieval System ("XXXXX"), except to the extent
permitted by Regulation S-T. As used in this Agreement, "Effective Time"
means the date and the time as of which such registration statement, or the
most recent post-effective amendment thereto, if any, was declared
effective by the Commission; "Effective Date" means the date of the
Effective Time; "Preliminary Prospectus" means each prospectus included in
such registration statement, or amendments thereof, before it became
effective under the Securities Act and any prospectus filed with the
Commission by the Company with the consent of the Representatives pursuant
to Rule 424(a) of the Rules and Regulations; "Registration Statement" means
such registration statement, as amended at the Effective Time, including
all information contained in the final prospectus filed with the Commission
pursuant to Rule 424(b) of the Rules and Regulations in accordance with
Section___hereof and deemed to be a part of the registration statement as
of the Effective Time pursuant to paragraph (b) of Rule 430A of the Rules
and Regulations; "Rule 462(b) Registration Statement" means any
registration statement filed pursuant to Rule 462(b) of the Rules and
Regulations, and after such filing, the term "Registration Statement" shall
include the Rule 462(b) Registration Statement; and "Prospectus" means such
final prospectus, as first filed with the Commission pursuant to paragraph
(1) or (4) of Rule 424(b) of the Rules and Regulations. The Commission has
not issued any order preventing or suspending the use of any Preliminary
Prospectus. For purposes of this Agreement, all references to any
Preliminary Prospectus, the Registration Statement, any Rule 462(b)
Registration Statement, the Prospectus, or any amendment or supplement to
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any of the foregoing, shall be deemed to include the respective copies
thereof filed with the Commission pursuant to XXXXX.
(b) The Registration Statement, including any Rule 462(b) Registration
Statement, conforms, and the Prospectus and any further amendments or
supplements to the Registration Statement, including any Rule 462(b)
Registration Statement, or the Prospectus, 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 Securities Act and the Rules
and Regulations and do not and will not, as of the applicable Effective
Date (as to the Registration Statement and any amendment thereto) and as of
the applicable filing date (as to the Prospectus and any amendment or
supplement thereto) contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make
the statements therein not misleading; provided that no representation or
warranty is made as to information contained in or omitted from the
Registration Statement, including any Rule 462(b) Registration Statement,
or the Prospectus in reliance upon and in conformity with written
information furnished to the Company through the Representatives by or on
behalf of any Underwriter specifically for inclusion therein.
(c) The Company and each of its subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation, is duly qualified to
do business and is in good standing as a foreign corporation in each
jurisdiction in which its ownership or lease of property or the conduct of
its business requires such qualification, and has all power and authority
necessary to own or hold its properties and to conduct the business in
which it is engaged; and none of the subsidiaries is a "significant
subsidiary," as such term is defined in Rule 405 of the Rules and
Regulations .
(d) The Company has an authorized and outstanding capitalization as
set forth in the Prospectus, and all of the issued shares of capital stock
of the Company have been duly and validly authorized and issued, are fully
paid and non-assessable and conform to the description thereof contained in
the Prospectus. Upon the closing of the Offering, no shares of capital
stock of the Company will be outstanding other than the Common Stock; and
all of the issued shares of capital stock of each subsidiary of the Company
have been duly and validly authorized and issued and are fully paid and
non-assessable and are owned directly or indirectly by the Company, free
and clear of all liens, encumbrances, equities or claims.
(e) The unissued shares of the Stock to be issued and sold by the
Company to the U.S. Underwriters hereunder and the International Managers
under the International Underwriting Agreement have been duly and validly
authorized and, when issued and delivered against payment therefor as
provided herein and the International Underwriting Agreement, will be duly
and validly issued, fully paid and non-assessable; and the Stock will
conform to the descriptions thereof contained in the Prospectus.
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(f) This Agreement has been duly authorized, executed and delivered by
the Company.
(g) The execution, delivery and performance of this Agreement and the
International Underwriting Agreement by the Company and the consummation of
the transactions contemplated hereby and thereby will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or any of
its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will such actions result
in any violation of the provisions of the charter or by-laws of the Company
or any of its subsidiaries or any statute or any order, rule or regulation
of any court or governmental agency or body having jurisdiction over the
Company or any of its subsidiaries or any of their properties or assets;
and except for the registration of the Stock under the Securities Act and
such consents, approvals, authorizations, registrations or qualifications
as may be required under the United States Securities Exchange Act of 1934,
as amended (the "Exchange Act"), and applicable state or foreign securities
laws and clearance by the National Association of Securities Dealers Inc.
in connection with the purchase and distribution of the Stock by the U.S.
Underwriters and the International Managers, no consent, approval,
authorization or order of, or filing or registration with, any such court
or governmental agency or body is required for the execution, delivery and
performance of this Agreement or the International Underwriting Agreement
by the Company and the consummation of the transactions contemplated hereby
and thereby.
(h) Except as described in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person granting
such person the right (other than rights which have been waived or
satisfied) to require the Company to file a registration statement under
the Securities Act with respect to any securities of the Company owned or
to be owned by such person or to require the Company to include such
securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Securities Act.
(i) Except as described in the Prospectus, the Company has not sold or
issued any shares of Common Stock during the six-month period preceding the
date of the Prospectus, including any sales pursuant to Rule 144A under, or
Regulations D or S of, the Securities Act, other than shares issued
pursuant to employee benefit plans, stock options plans or other employee
compensation plans or pursuant to outstanding options, rights or warrants.
(j) Neither the Company nor any of its subsidiaries has sustained,
since the date of the latest audited financial statements included in the
Prospectus, any material loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or
from any labor dispute or court or governmental
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action, order or decree, otherwise than as set forth or contemplated in the
Prospectus; and, since such date, there has not been any change in the
capital stock or long-term debt of the Company or any of its subsidiaries
or any material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of operations of the
Company and its subsidiaries taken as a whole, otherwise than as set forth
or contemplated in the Prospectus.
(k) The financial statements (including the related notes and
supporting schedules) filed as part of the Registration Statement or
included in the Prospectus present fairly the financial condition and
results of operations of the entities purported to be shown thereby, at the
dates and for the periods indicated and have been prepared in conformity
with generally accepted accounting principles (except in the case of
unaudited interim financial statements for normal recurring adjustments)
applied on a consistent basis throughout the periods involved, except as
otherwise stated therein.
(l) Xxxxxx Xxxxxxxx LLP, who have certified certain financial
statements of the Company, whose report appears in the Prospectus and who
have delivered the initial letters referred to in Section 9(g) hereof, are
independent public accountants as required by the Securities Act and the
Rules and Regulations.
(m) The Company together with its subsidiaries have good and
marketable title to all real and personal property owned by them, in each
case free and clear of all liens, encumbrances and defects except such as
are described in the Prospectus or such as do not materially affect the
value of such property and do not materially interfere with the use made
and proposed to be made of such property by the Company and its
subsidiaries taken as a whole; and, except as set forth or contemplated in
the Prospectus, all real property and buildings held under lease by the
Company and its subsidiaries are held by it under valid, subsisting and
enforceable leases, with such exceptions as are not material and do not
interfere with the use made and proposed to be made of such property and
buildings by the Company and its subsidiaries taken as a whole.
(n) The Company together with its subsidiaries carry or are covered
by, insurance in such amounts and covering such risks as is adequate for
the conduct of their respective businesses and the value of their
properties and as is customary for companies engaged in similar businesses
in similar industries.
(o) Except as disclosed in or specifically contemplated by the
Prospectus, the Company and its subsidiaries own or possess adequate rights
to use all trademarks, trademark applications, trade names, service marks,
patents, patent applications, patent rights, copyrights, inventions, trade
secrets, know how, licenses, approvals and governmental authorizations that
are necessary to conduct their business as described in the Registration
Statement and Prospectus; the expiration of any trademarks, trademark
applications, trade names, service marks, patents, patent applications,
patent rights, copyrights, inventions, trade secrets, know how, licenses,
approvals and governmental
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authorizations would not have a material adverse effect on the earnings,
business, management, properties, assets, rights, operations, condition
(financial or otherwise) or prospects of the Company or its subsidiaries;
to the knowledge of the Company, none of the patents owned or licensed by
the Company are unenforceable or invalid; the Company has duly and properly
filed or caused to be filed with the United States Patent and Trademark
Office (the "PTO") and applicable foreign and international patent
authorities all patent applications described or referred to in the
Prospectus, and the Company is unaware of any facts which would preclude
the grant of a patent from any of its patent applications; the Company has
no knowledge of any facts which would preclude it from having clear title
to its patent applications referenced in the Prospectus; except as
described in the Prospectus, the Company has no knowledge of, and has
received no notice of, any material infringement or misappropriation by the
Company of any trademark, trademark application, trade name, service xxxx,
patent, patent application, patent right, mask work, copyright, invention,
know how, license, trade secret or other similar rights of others; the
Company has not terminated or breached and is not in violation of any
agreement covering its intellectual property rights; and the Company and
its subsidiaries taken as a whole have no reason to believe that the
conduct of their respective businesses will conflict with, and have not
received any notice of any claim of conflict with, any rights of third
parties to any of the intellectual property of the Company or its
subsidiaries.
(p) Except as described in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property or assets of the Company
or any of its subsidiaries is the subject which, if determined adversely to
the Company or any of its subsidiaries, might have a material adverse
effect on the financial position, stockholders' equity, results of
operations, business or prospects of the Company and its subsidiaries taken
as a whole; and to the best of the Company's knowledge, no such proceedings
are threatened or contemplated by governmental authorities or threatened by
others.
(q) There are no contracts or other documents which are required to be
described in the Prospectus or filed as exhibits to the Registration
Statement by the Securities Act or by the Rules and Regulations which have
not been described in the Prospectus or filed as exhibits to the
Registration Statement or incorporated therein by reference as permitted by
the Rules and Regulations.
(r) No relationship, direct or indirect, exists between or among the
Company on the one hand, and the directors, officers, stockholders,
customers or suppliers of the Company on the other hand, which is required
to be described in the Prospectus which is not so described.
(s) No labor disturbance by the employees of the Company exists or, to
the knowledge of the Company, is imminent which might be expected to have a
material adverse effect on the financial position, stockholders' equity,
results of operations, business or prospects of the Company and its
subsidiaries.
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(t) The Company and its subsidiaries are in compliance in all material
respects with all presently applicable provisions of the Employee
Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder ("ERISA"); no
"reportable event" (as defined in ERISA) has occurred with respect to any
"pension plan" (as defined in ERISA) for which the Company would have any
liability; the Company has not incurred and does not expect to incur
liability under (i) Title IV of ERISA with respect to termination of, or
withdrawal from, any "pension plan" or (ii) Sections 412 or 4971 of the
Internal Revenue Code of 1986, as amended, including the regulations and
published interpretations thereunder (the "Code"); and each "pension plan"
for which the Company would have any liability that is intended to be
qualified under Section 401(a) of the Code is so qualified in all material
respects and nothing has occurred, whether by action or by failure to act,
which would cause the loss of such qualification.
(u) The Company has filed all federal, state and local income and
franchise tax returns required to be filed through the date hereof and has
paid all taxes due thereon, and no tax deficiency has been determined
adversely to the Company which has had (nor does the Company have any
knowledge of any tax deficiency which, if determined adversely to the
Company or any of its subsidiaries, is reasonably likely to have) a
material adverse effect on the financial position, stockholders' equity,
results of operations, business or prospects of the Company and its
subsidiaries taken as a whole, otherwise than as set forth in the
Prospectus.
(v) Since the date as of which information is given in the Prospectus
through the date hereof, and except as may otherwise be disclosed in the
Prospectus, the Company has not (i) issued or granted any securities, (ii)
incurred any liability or obligation, direct or contingent, other than
liabilities and obligations which were incurred in the ordinary course of
business, (iii) entered into and transaction not in the ordinary course of
business or (iv) declared or paid any dividend on its capital stock.
(w) The Company (i) makes and keeps accurate books and records and
(ii) maintains internal accounting controls which provide reasonable
assurance that (A) transactions are executed in accordance with
management's authorization, (B) transactions are recorded as necessary to
permit preparation of its financial statements and to maintain
accountability for its assets, (C) access to its assets is permitted only
in accordance with management's authorization and (D) the reported
accountability for its assets is compared with existing assets at
reasonable intervals.
(x) Neither the Company nor any of its subsidiaries (i) is in
violation of its charter or by-laws, (ii) is in default in any material
respect, and no event has occurred which, with notice or lapse of time or
both, would constitute such a default, in the due performance or observance
of any term, covenant or condition contained in any material indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which it is a party or by which it is bound or to which any of its
properties or assets is
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subject or (iii) is in violation in any material respect of any law,
ordinance, governmental rule, regulation or court decree to which it or its
property or assets may be subject.
(y) Neither the Company nor any of its subsidiaries, nor any director,
officer, agent, employee or other person associated with or acting on
behalf of the Company or any of its subsidiaries, has used any corporate
funds for any unlawful contribution, gift, entertainment or other unlawful
expense relating to political activity; made any direct or indirect
unlawful payment to any foreign or domestic government official or employee
from corporate funds; violated or is in violation of any provision of the
Foreign Corrupt Practices Act of 1977; or made any bribe, rebate, payoff,
influence payment, kickback or other unlawful payment.
(z) There has been no storage, disposal, generation, manufacture,
refinement, transportation, handling or treatment of toxic wastes, medical
wastes, hazardous wastes or hazardous substances by the Company or any of
its subsidiaries (or, to the knowledge of the Company, any of their
predecessors in interest) at, upon or from any of the property now or
previously owned or leased by the Company or its subsidiaries in violation
of any applicable law, ordinance, rule, regulation, order, judgment, decree
or permit or which would require remedial action under any applicable law,
ordinance, rule, regulation, order, judgment, decree or permit, except for
any violation or remedial action which would not have, or could not be
reasonably likely to have, singularly or in the aggregate with all such
violations and remedial actions, a material adverse effect on the general
affairs, management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries; there has been no material
spill, discharge, leak, emission, injection, escape, dumping or release of
any kind onto such property or into the environment surrounding such
property of any toxic wastes, medical wastes, solid wastes, hazardous
wastes or hazardous substances due to or caused by the Company or any of
its subsidiaries or with respect to which the Company or any of its
subsidiaries have knowledge, except for any such spill, discharge, leak,
emission, injection, escape, dumping or release which would not have or
would not be reasonably likely to have, singularly or in the aggregate with
all such spills, discharges, leaks, emissions, injections, escapes,
dumpings and releases, a material adverse effect on the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and it subsidiaries; and the terms "hazardous
wastes", "toxic wastes", "hazardous substances" and "medical wastes" shall
have the meanings specified in any applicable local, state, federal and
foreign laws or regulations with respect to environmental protection.
(aa) Neither the Company nor any of its subsidiaries is, or will
become as a result of the consummation of the transactions contemplated by
this Agreement or the International Underwriting Agreement, an "investment
company" within the meaning of such term under the Investment Company Act
of 1940 and the rules and regulations of the Commission thereunder.
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2. Purchase of the Stock by the U.S. Underwriters. On the basis of
the representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Company agrees to sell _________ shares of
the Firm Stock to the several U.S. Underwriters and each of the U.S.
Underwriters, severally and not jointly, agrees to purchase the number of shares
of the Firm Stock set opposite that U.S. Underwriter's name in Schedule 1
hereto. Each U.S. Underwriter shall be obligated to purchase form the Company
that number of shares of the Firm Stock which represents the same proportion of
the number of shares of the Firm Stock to be sold by the Company as the number
of shares of the Firm Stock set forth opposite the name of such U.S. Underwriter
in Schedule 1 represents of the total number of shares of the Firm Stock to be
purchased by all of the U.S. Underwriters pursuant to this Agreement. The
respective purchase obligations of the U.S. Underwriters with respect to the
Firm Stock shall be rounded among the Underwriters to avoid fractional shares,
as the Representatives may determine.
In addition, the Company grants to the U.S. Underwriters an option to
purchase up to _________ shares of Option Stock. Such option is granted solely
for the purpose of covering over-allotments in the sale of Firm Stock and is
exercisable as provided in Section 4 hereof. Shares of Option Stock shall be
purchased severally for the account of the U.S. Underwriters in proportion to
the number of shares of Firm Stock set opposite the name of such U.S.
Underwriters in Schedule 1 hereto. The respective obligations of each U.S.
Underwriter with respect to the Option Stock shall be adjusted by the
Representatives so that commitments to purchase Option Stock shall be
proportionate to such U.S. Underwriter's initial commitment as provided in
Schedule 1. Such respective purchase obligations with respect to the Option
Stock shall be rounded among the U.S. Underwriters to avoid fractional shares,
as the Representatives may determine. The price of both the Firm Stock and any
Option Stock shall be $_____ per share.
3. Offering of Stock by the U.S. Underwriters. Upon authorization
by the Representatives of the release of the Firm Stock, the several U.S.
Underwriters propose to offer the Firm Stock for sale upon the terms and
conditions set forth in the Prospectus.
Each U.S. Underwriter agrees that, except to the extent permitted by
the Agreement Between U.S. Underwriters and International Managers, it will not
offer or sell any of the Stock outside of the United States.
4. Delivery of and Payment for the Stock. Delivery of and payment
for the Firm Stock shall be made at the office of Xxxxx, Xxxxxxx & Xxxxxxxxx,
LLP, 000 Xxxx Xxxxxx, Xxxxxx, XX 00000, at 10:00 A.M., Eastern time, on the
third full business day (unless otherwise required by the Commission pursuant to
Rule 15c6-1 of the Exchange Act) following the date of this Agreement or at such
other date or place as shall be determined by agreement between the
Representatives and the Company. This date and time are sometimes referred to
as the "First Delivery Date." On the First Delivery Date, the Company shall
deliver or cause to be delivered certificates representing the Firm Stock to the
Representatives for the account of each U.S. Underwriter against payment to or
upon the order of the Company of the purchase price by wire transfer in next-day
funds. Time shall be of the essence, and delivery at the time and place
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specified pursuant to this Agreement is a further condition of the obligation of
each U.S. Underwriter hereunder. Upon delivery, the Firm Stock shall be
registered in such names and in such denominations as the Representatives shall
request in writing not less than two full business days prior to the First
Delivery Date. For the purpose of expediting the checking and packaging of the
certificates for the Firm Stock, the Company shall make the certificates
representing the Firm Stock available for inspection by the Representatives in
New York, New York, not later than 2:00 P.M., Eastern time, on the business day
prior to the First Delivery Date.
At any time on or before the thirtieth day after the date of this
Agreement the option granted in Section 2 may be exercised by written notice
being given to the Company by the Representatives. Such notice shall set forth
the aggregate number of shares of Option Stock as to which the option is being
exercised, the names in which the shares of Option Stock are to be registered,
the denominations in which the shares of Option Stock are to be issued and the
date and time, as determined by the Representatives, when the shares of Option
Stock are to be delivered; provided, however, that this date and time shall not
be earlier than the First Delivery Date nor earlier than the second business day
after the date on which the option shall have been exercised nor later than the
third business day after the date on which the option shall have been exercised.
The date and time the shares of Option Stock are delivered are sometimes
referred to as the "Second Delivery Date" and the First Delivery Date and the
Second Delivery Date are sometimes each referred to as a "Delivery Date").
Delivery of and payment for the Option Stock shall be made at the
place specified in the first sentence of the first paragraph of this Section 4
(or at such other place as shall be determined by agreement between the
Representatives and the Company) at 10:00 A.M., New York City time, on the
Second Delivery Date. On the Second Delivery Date, the Company shall deliver or
cause to be delivered the certificates representing the Option Stock to the
Representatives for the account of each U.S. Underwriter against payment to or
upon the order of the Company of the purchase price by wire transfer in next-day
funds. Time shall be of the essence, and delivery at the time and place
specified pursuant to this Agreement is a further condition of the obligation of
each U.S. Underwriter hereunder. Upon delivery, the Option Stock shall be
registered in such names and in such denominations as the Representatives shall
request in the aforesaid written notice. For the purpose of expediting the
checking and packaging of the certificates for the Option Stock, the Company
shall make the certificates representing the Option Stock available for
inspection by the Representatives in New York, New York, not later than 2:00
P.M., New York City time, on the business day prior to the Second Delivery Date.
5. Further Agreements of the Company. The Company agrees:
(a) To prepare the Prospectus in a form approved by the
Representatives and to file such Prospectus pursuant to Rule 424(b) under
the Securities Act not later than Commission's close of business on the
second business day following the execution and delivery of this Agreement
or, if applicable, such earlier time as may be required by Rule 430A(a)(3)
under the Securities Act; to make no further amendment or any supplement to
the Registration Statement or to the Prospectus except as permitted herein;
to advise the Representatives, promptly after it receives notice thereof,
of the time when any
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amendment to the Registration Statement or any Rule 462(b) Registration
Statement has been filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed and to furnish the
Representatives with copies thereof; to advise the Representatives,
promptly after it receives notice thereof, of the issuance by the
Commission of any stop order or of any order preventing or suspending the
use of any Preliminary Prospectus or the Prospectus, of the suspension of
the qualification of the Stock for offering or sale in any jurisdiction, of
the initiation or threatening of any proceeding for any such purpose, or of
any request by the Commission for the amending or supplementing of the
Registration Statement or the Prospectus or for additional information;
and, in the event of the issuance of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or the
Prospectus or suspending any such qualification, to use promptly its best
efforts to obtain its withdrawal;
(b) To furnish promptly to each of the Representatives and to counsel
for the U.S. Underwriters a signed copy of the Registration Statement,
including any Rule 462(b) Registration Statement, as originally filed with
the Commission, and each amendment thereto filed with the Commission,
including all consents and exhibits filed therewith;
(c) To deliver promptly to the Representatives such number of the
following documents as the Representatives shall reasonably request: (i)
conformed copies of the Registration Statement, including any Rule 462(b)
Registration Statement, as originally filed with the Commission and each
amendment thereto (in each case excluding exhibits other than this
Agreement and the computation of per share earnings) and, (ii) each
Preliminary Prospectus, the Prospectus and any amended or supplemented
Prospectus; and, if the delivery of a prospectus is required at any time
after the Effective Time in connection with the offering or sale of the
Stock or any other securities relating thereto and if at such time any
events shall have occurred as a result of which the Prospectus as then
amended or supplemented would include an untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made when such Prospectus is delivered, not misleading, or, if for any
other reason it shall be necessary to amend or supplement the Prospectus in
order to comply with the Securities Act, to notify the Representatives and,
upon their request, to prepare and furnish without charge to each U.S.
Underwriter and to any dealer in securities as many copies as the
Representatives may from time to time reasonably request of an amended or
supplemented Prospectus which will correct such statement or omission or
effect such compliance. To the extent applicable, the copies of the
Registration Statement and each amendment thereto (including all exhibits
filed therewith), including any Rule 462(b) Registration Statement, any
Preliminary Prospectus or Prospectus (in each case, as amended or
supplemented) furnished to the U.S. Underwriters and counsel to the U.S.
Underwriters will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to the extent
permitted by Regulation S-T;
(d) To file promptly with the Commission any amendment to the
Registration Statement, including any filing required under Rule 462(b), or
the Prospectus or any
-11-
supplement to the Prospectus that may, in the judgment of the Company or
the Representatives, be required by the Securities Act or requested by the
Commission;
(e) Prior to filing with the Commission any amendment to the
Registration Statement, including any filing required under Rule 462(b), or
supplement to the Prospectus or any Prospectus pursuant to Rule 424 of the
Rules and Regulations, to furnish a copy thereof to the Representatives and
counsel for the U.S. Underwriters and obtain the consent of the
Representatives to the filing;
(f) As soon as practicable after the Effective Date, to make generally
available to the Company's shareholders and to deliver to the
Representatives an earnings statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11 (a) of the Securities
Act and the Rules and Regulations (including, at the option of the Company,
Rule 158);
(g) For a period of five years following the Effective Date, to
furnish to the Representatives copies of all materials furnished by the
Company to its shareholders and all public reports and all reports and
financial statements furnished by the Company to the principal national
securities exchange upon which the Common Stock may be listed pursuant to
requirements of or agreements with such exchange or to the Commission
pursuant to the Exchange Act or any rule or regulation of the Commission
thereunder; and to the extent applicable, such reports or documents shall
be identical to the electronically transmitted copies thereof filed with
the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(h) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify the Stock for offering
and sale under the securities laws of such jurisdictions as the
Representatives may request and to comply with such laws so as to permit
the continuance of sales and dealings therein in such jurisdictions for as
long as may be necessary to complete the distribution of the Stock;
(i) For a period of 180 days from the date of the Prospectus, not to
offer for sale, sell or otherwise dispose of (or enter into any transaction
which is designed to, or could be expected to, result in the disposition by
any person of), directly or indirectly, any shares of Common Stock (other
than the Stock and shares issued pursuant to employee benefit plans, stock
option plans or other employee compensation plans existing on the date
hereof or pursuant to currently outstanding options, warrants or rights),
or sell or grant options, rights or warrants with respect to any shares of
Common Stock (other than the grant of options pursuant to option plans
existing on the date hereof), without the prior written consent of Xxxxxx
Brothers Inc.; and to cause each officer and director and each record owner
of shares of Common Stock and Preferred Stock of the Company other than
those record owners listed in writing by the Company to Xxxxxx Brothers,
Inc. and approved by it prior to the First Delivery Date, to furnish to the
Representatives, prior to the First Delivery Date, a letter or letters, in
form and substance satisfactory to counsel for the U.S. Underwriters,
pursuant to which each such
-12-
person shall agree not to offer for sale, sell or otherwise dispose of (or
enter into any transaction which is designed to, or could be expected to,
result in the disposition by any person of), directly or indirectly, any
shares of Common Stock for a period of 180 days from the date of the
Prospectus, without the prior written consent of Xxxxxx Brothers Inc.; for
a period of 180 days from the date of the Prospectus, except as required by
law, the board of directors of the Company will not consent to any offer
for sale, sale or other disposal of (or consent to any transaction which is
designed, or could be expected to, result in the disposition by any person
of), directly or indirectly, any shares of Common Stock without the prior
written consent of Xxxxxx Brothers Inc.;
(j) Prior to the Effective Date, to apply for the listing of the
Stock on the Nasdaq National Market and to use its best efforts to complete
that listing, subject only to official notice of issuance and evidence of
satisfactory distribution, prior to the First Delivery Date;
(k) Prior to filing with the Commission any reports on Form SR
pursuant to Rule 463 of the Rules and Regulations, to furnish a copy
thereof to the counsel for the U.S. Underwriters and receive and consider
its comments thereon, and to deliver promptly to the Representatives a
signed copy of each report on Form SR filed by it with the Commission;
(l) To apply the net proceeds from the sale of the Stock being sold
by the Company as set forth in the Prospectus; and
(m) To take such steps as shall be necessary to ensure that neither
the Company nor any subsidiary shall become an "investment company" within
the meaning of such term under the Investment Company Act of 1940 and the
rules and regulations of the Commission thereunder.
6. Expenses. The Company agrees to pay (a) the costs incident to
the authorization, issuance, sale and delivery of the Stock and any taxes
payable in that connection; (b) the costs incident to the preparation, printing
and filing under the Securities Act of the Registration Statement and any
amendments and exhibits thereto; (c) the costs of distributing the Registration
Statement as originally filed and each amendment thereto and any post-effective
amendments thereof (including, in each case, exhibits), any Preliminary
Prospectus, the Prospectus and any amendment or supplement to the Prospectus,
all as provided in this Agreement; (d) the costs of producing and distributing
this Agreement, the Agreement Between U.S. Underwriters and International
Managers and the Supplemental Agreement Among U.S. Underwriters and any other
related documents in connection with the offering, purchase, sale and delivery
of the Stock; (e) the costs of delivering and distributing the terms of
agreement relating to the organization of the domestic underwriting syndicate
and selling group to the members thereof by mail, telex or other means of
communications; (f) the filing fees incident to securing any required review by
the National Association of Securities Dealers, Inc. of the terms of sale of the
Stock; (g) any applicable listing or other fees; (h) the fees and expenses of
qualifying the Stock under the securities laws of the several jurisdictions as
provided in Section 5(h) and of
-13-
preparing, printing and distributing a Blue Sky Memorandum (including related
fees and expenses of counsel to the Underwriters); (k) all other costs and
expenses incident to the performance of the obligations of the Company under
this Agreement; provided that, except as provided in this Section 6 and in
Section 11 the Underwriters shall pay their owns costs and expenses, including
the costs and expenses of their counsel, any transfer taxes on the Stock which
they may sell and the expenses of advertising any offering of the Stock made by
the Underwriters.
7. Conditions of U.S. Underwriters' Obligations. The respective
obligations of the U.S. Underwriters hereunder are subject to the accuracy, when
made and on each Delivery Date, of the representations and warranties of the
Company contained herein, to the performance by the Company of its obligations
hereunder, and to each of the following additional terms and conditions:
(a) The Prospectus shall have been timely filed with the Commission
in accordance with Section 6(a); no stop order suspending the effectiveness
of the Registration Statement, including any Rule 462(b) Registration
Statement, or any part thereof shall have been issued and no proceeding for
that purpose shall have been initiated or threatened by the Commission; and
any request of the Commission for inclusion of additional information in
the Registration Statement or the Prospectus or otherwise shall have been
complied with.
(b) No U.S. Underwriter or International Manager shall have
discovered and disclosed to the Company on or prior to such Delivery Date
that the Registration Statement, any Rule 462(b) Registration Statement, or
the Prospectus or any amendment or supplement thereto contains an untrue
statement of a fact which, in the opinion of Xxxxx, Xxxxxxx & Xxxxxxxxx,
LLP, counsel for the U.S. Underwriters, is material or omits to state a
fact which, in the opinion of such counsel, is material and is required to
be stated therein or is necessary to make the statements therein not
misleading.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the International
Underwriting Agreement, the Stock, the Registration Statement and the
Prospectus, and all other legal matters relating to this Agreement and the
transactions contemplated hereby shall be reasonably satisfactory in all
material respects to counsel for the U.S. Underwriters, and the Company
shall have furnished to such counsel all documents and information that
they may reasonably request to enable them to pass upon such matters.
(d) Brown, Rudnick, Freed & Gesmer shall have furnished to the
Representatives its written opinion, as counsel to the Company, addressed
to the U.S. Underwriters and dated such Delivery Date, in form and
substance reasonably satisfactory to the Representatives, to the effect set
forth in Annex A hereto;
In rendering such opinion, such counsel may state that (i) its opinion
is limited to matters governed by the Federal laws of the United States of
America and the General
-14-
Corporation Law of the State of Delaware and that such counsel is not
admitted in the State of Delaware; and (ii) in giving the opinion referred
to in Section 7(i), state that it is relying upon opinions of foreign
counsel for certain subsidiaries and, with respect to matters of fact, upon
certificates of officers of the Company or its subsidiaries, provided that
such counsel shall state that it believes that the U.S. Underwriters and it
are justified in relying upon such opinions and certificates. Such counsel
shall also have furnished to the Representatives a written statement,
addressed to the Underwriters and dated such Delivery Date, in form and
substance satisfactory to the Representatives, to the effect that such
counsel has participated in conferences with officers and other
representatives of the Company, representatives of the independent public
accountants for the Company, the Representatives and counsel for the
Representatives at which the contents of the Registration Statement and the
Prospectus and related matters were discussed and, although such counsel is
not passing upon and does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement and the Prospectuses (except for the statements made in the
Prospectus under the captions "Description of Capital Stock," and
"Business--Legal Proceedings" insofar as such statements constitute a
summary of documents referred to therein or matters of law constitute an
accurate summary of the matters described therein) and based on the
foregoing, no facts have come to the attention of such counsel which lead
it to believe that the Registration Statement, as of the Effective Date,
contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make
the statements therein not misleading, or that the Prospectus contains any
untrue statement of a material fact or omits to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading (it being understood that such counsel is not requested to and
need not express any comment with respect to the financial statements and
schedules and other financial and statistical data included in the
Registration Statement or Prospectus).
(e) Xxxxxx & Xxxxxx LLP shall have furnished to the Representatives
its written opinion, as patent counsel to the Company, addressed to the
U.S. Underwriters and dated such Delivery Date, in form and substance
reasonably satisfactory to the Representatives, to the effect set forth in
Annex B hereto;
(f) The Representatives shall have received from Xxxxx, Xxxxxxx &
Xxxxxxxxx, LLP, counsel for the Underwriters, such opinion or opinions,
dated such Delivery Date, with respect to the issuance and sale of the
Stock, the Registration Statement, the Prospectus and other related matters
as the Representatives may reasonably require, and the Company shall have
furnished to such counsel such documents as they reasonably request for the
purpose of enabling them to pass upon such matters.
(g) At the time of execution of this Agreement, the Representatives
shall have received from Xxxxxx Xxxxxxxx a letter, in form and substance
satisfactory to the Representatives, addressed to the Underwriters and
dated the date hereof (i) confirming that they are independent public
accountants within the meaning of the Securities Act and
-15-
are in compliance with the applicable requirements relating to the
qualification of accountants under Rule 2-01 of Regulation S-X of the
Commission, (ii) stating, as of the date hereof (or, with respect to
matters involving changes or developments since the respective dates as of
which specified financial information is given in the Prospectus, as of a
date not more than five days prior to the date hereof), the conclusions and
findings of such firm with respect to the financial information and other
matters ordinarily covered by accountants' "comfort letters" to
underwriters in connection with registered public offerings.
(h) With respect to the letter of Xxxxxx Xxxxxxxx LLP referred to in
the preceding paragraph and delivered to the Representatives concurrently
with the execution of this Agreement (the "initial letter"), the Company
shall have furnished to the Representatives a letter (the "bring-down
letter") of such accountants, addressed to the Underwriters and dated such
Delivery Date (i) confirming that they are independent public accountants
within the meaning of the Securities Act and are in compliance with the
applicable requirements relating to the qualification of accountants under
Rule 2-01 of Regulation S-X of the Commission, (ii) stating, as of the date
of the bring-down letter (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than five
days prior to the date of the bring-down letter), the conclusions and
findings of such firm with respect to the financial information and other
matters covered by the initial letter and (iii) confirming in all material
respects the conclusions and findings set forth in the initial letter.
(i) The Company shall have furnished to the Representatives a
certificate, dated such Delivery Date, of its Chairman of the Board, its
President or a Vice President and its chief financial officer stating that:
(i) The representations, warranties and agreements of the Company
in Section 1 are true and correct as of such Delivery Date; the Company has
complied with all its agreements contained herein; and the conditions set
forth in Sections 7(a) and 7(m) have been fulfilled; and
(ii) They have carefully examined the Registration Statement and
the Prospectus and, in their opinion (A) as of the Effective Date, the
Registration Statement and Prospectus did not include any untrue statement
of a material fact and did not omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading,
and (B) since the Effective Date no event has occurred which should have
been set forth in a supplement or amendment to the Registration Statement
or the Prospectus.
(j) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included in the Prospectus any loss or interference with its business from
fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order
or
-16-
decree, otherwise than as set forth or contemplated in the Prospectus or
(ii) since such date there shall not have been any change in the capital
stock or long-term debt of the Company or any change, or any development
involving a prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company, otherwise than as set forth or contemplated in
the Prospectus, the effect of which, in any such case described in clause
(i) or (ii), is, in the judgment of the Representatives, so material and
adverse as to make it impracticable or inadvisable to proceed with the
public offering or the delivery of the Stock being delivered on such
Delivery Date on the terms and in the manner contemplated in the
Prospectus.
(k) Subsequent to the execution and delivery of this Agreement there
shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange or the American Stock Exchange or
in the over-the-counter market, or trading in any securities of the Company
on any exchange or in the over-the-counter market, shall have been
suspended or minimum prices shall have been established on any such
exchange or such market by the Commission, by such exchange or by any other
regulatory body or governmental authority having jurisdiction, (ii) a
banking moratorium shall have been declared by Federal or state
authorities, (iii) the United States shall have become engaged in
hostilities, there shall have been an escalation in hostilities involving
the United States or there shall have been a declaration of a national
emergency or war by the United States or (iv) there shall have occurred
such a material adverse change in general economic, political or financial
conditions (or the effect of international conditions on the financial
markets in the United States shall be such) as to make it, in the judgment
of a majority in interest of the several U.S. Underwriters, impracticable
or inadvisable to proceed with the public offering or delivery of the Stock
being delivered on such Delivery Date on the terms and in the manner
contemplated in the Prospectus.
(l) The Nasdaq National Market shall have approved the Stock for
listing, subject only to official notice of issuance and evidence of
satisfactory distribution.
(m) The closing under the International Underwriting Agreement shall
have occurred concurrently with the closing hereunder on the First Delivery
Date.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the U.S. Underwriters.
8. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each Underwriter,
its officers and employees and each person, if any, who controls any
Underwriter within the meaning of the Securities Act, from and against any
loss, claim, damage or liability, joint or several, or any action in
respect thereof (including, but not limited to, any loss, claim, damage,
liability or action relating to purchases and sales of Stock), to which
that
-17-
Underwriter, officer, employee or controlling person may become
subject, under the Securities Act or otherwise, insofar as, such loss,
claim, damage, liability or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained
(A) in any Preliminary Prospectus, the Registration Statement or the
Prospectus or in any amendment or supplement thereto or (B) in any blue sky
application or other document prepared or executed by the Company (or based
upon any written information furnished by the Company) specifically for the
purpose of qualifying any or all of the Stock under the securities laws of
any state or other jurisdiction (any such application, document or
information being hereinafter called a "Blue Sky Application"), (ii) the
omission or alleged omission to state in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or in any amendment or supplement
thereto, or in any Blue Sky Application any material fact required to be
stated therein or necessary to make the statements therein not misleading,
or (iii) any act or failure to act or any alleged act or failure to act by
any Underwriter in connection with, or relating in any manner to, the Stock
or the offering contemplated hereby, and which is included as part of or
referred to in any loss, claim, damage, liability or action arising out of
or based upon matters covered by clause (i) or (ii) above (provided that
the Company shall not be liable under this clause (iii) to the extent that
it is determined in a final judgment by a court of competent jurisdiction
that such loss, claim, damage, liability or action resulted directly from
any such acts or failures to act undertaken or omitted to be taken by such
U.S. Underwriter through its gross negligence or willful misconduct), and
shall reimburse each U.S. Underwriter and each such officer, employee or
controlling person promptly upon demand for any legal or other expenses
reasonably incurred by that U.S. Underwriter, officer, employee or
controlling person in connection with investigating or defending or
preparing to defend against such loss, claim, damage, liability or action
as such expenses are incurred; and, provided, further, however, that the
Company shall not be liable in any such case to the extent that any such
loss, claim, damage, liability or action arises out of, or is based upon,
any untrue statement or alleged untrue statement or omission or alleged
omission made in any Preliminary Prospectus, the Registration Statement or
the Prospectus, or in any such amendment or supplement, or in any Blue Sky
Application, in reliance upon and in conformity with written information
concerning such U.S. Underwriter furnished to the Company through the
Representatives by or on behalf of any U.S. Underwriter or any
International Manager specifically for inclusion therein. The foregoing
indemnity agreement is in addition to any liability which the Company may
otherwise have to any U.S. Underwriter or to any officer, employee or
controlling person of that Underwriter.
(b) Each U.S. Underwriter, severally and not jointly, shall indemnify
and hold harmless the Company, its officers and employees, each of its
directors, and each person, if any, who controls the Company within the
meaning of the Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which the
Company or any such director, officer or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained
(A) in any Preliminary Prospectus,
-18-
the Registration Statement or the Prospectus or in any amendment or
supplement thereto, or (B) in any Blue Sky Application or (ii) the omission
or alleged omission to state in any Preliminary Prospectus, the
Registration Statement or the Prospectus, or in any amendment or supplement
thereto, or in any Blue Sky Application any material fact required to be
stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that the untrue statement or alleged
untrue statement or omission or alleged omission was made in reliance upon
and in conformity with written information concerning such U.S. Underwriter
furnished to the Company through the Representatives by or on behalf of
that U.S. Underwriter specifically for inclusion therein, and shall
reimburse the Company and any such director, officer or controlling person
for any legal or other expenses reasonably incurred by the Company or any
such director, officer or controlling person in connection with
investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred. The
foregoing indemnity agreement is in addition to any liability which any
U.S. Underwriter may otherwise have to the Company or any such director,
officer, employee or controlling person.
(c) Promptly after receipt by an indemnified party under this Section
8 of notice of any claim or the commencement of any action, the identified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however,
that the failure to notify the indemnifying party shall not relieve it from
any liability which it may have under this Section 8 except to the extent
it has been materially prejudiced by such failure and, provided further,
that the failure to notify the indemnifying party shall not relieve it from
any liability which it may have to an indemnified party otherwise than
under this Section 8. If any such claim or action shall be brought against
an indemnified party, and it shall notify the indemnifying party thereof,
the indemnifying party shall be entitled to participate therein and, to the
extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the indemnifying
party to the indemnified party of its election to assume the defense of
such claim or action, the indemnifying party shall not be liable to the
indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation; provided,
however, that the Representatives shall have the right to employ counsel to
represent jointly the Representatives and those other U.S. Underwriters and
their respective officers, employees and controlling persons who may be
subject to liability arising out of any claim in respect of which indemnity
may be sought by the U.S. Underwriters against the Company under this
Section 8 if, in the reasonable judgment of the Representatives, it is
advisable for the Representatives and those U.S. Underwriters, officers,
employees and controlling persons to be jointly represented by separate
counsel, and in that event the fees and expenses of such separate counsel
shall be paid by the Company. No indemnifying party shall (i) without, the
prior written consent of the indemnified parties (which consent shall not
be unreasonably withheld), settle or compromise or consent to the entry of
any judgment with respect to
-19-
any pending or threatened claim, action, suit or proceeding in respect of
which indemnification or contribution may be sought hereunder (whether or
not the indemnified parties are actual or potential parties to such claim
or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising
out of such claim, action, suit or proceeding, or (ii) be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with the
consent of the indemnifying party or if there be a final judgment of the
plaintiff in any such action, the indemnifying party agrees to indemnify
and hold harmless any indemnified party from and against any loss or
liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 8 shall for
any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 8(a), 8(b) or 8(c) in respect of any loss,
claim, damage or liability, or any action in respect thereof, referred to
therein, then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such
indemnified party a result of such loss, claim, damage or liability, or
action in respect thereof, (i) in such proportion as shall be appropriate
to reflect the relative benefits received by the Company on the one hand
and the U.S. Underwriters on the other from the offering of the Stock or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only
the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the U.S. Underwriters on the other
with respect to the statements or omissions which resulted in such loss,
claim, damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations. The relative benefits received by
the Company on the one hand and the U.S. Underwriters on the other with
respect to such offering shall be deemed to be in the same proportion as
the total net proceeds from the offering of the Stock purchased under this
Agreement (before deducting expenses) received by the Company, on the one
hand, and the total underwriting discounts and commissions received by the
U.S. Underwriters with respect to the shares of the Stock purchased under
this Agreement, on the other hand, bear to the total gross proceeds from
the offering of the shares of the Stock under this Agreement, in each case
as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to whether the, untrue or
alleged untrue statement of a material fact or omission or alleged omission
to state a material fact relates to information supplied by the Company or
the U.S. Underwriters, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and the U.S. Underwriters agree that it
would not be just and equitable if contributions pursuant to this Section
were to be determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of
allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as
a result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section shall be deemed to include, for
purposes of this Section 8(d), any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
-20-
defending any such action or claim. Notwithstanding the provisions of this
Section 8(d), no U.S. Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the Stock
underwritten by it and distributed to the public was offered to the public
exceeds the amount of any damages which such U.S. Underwriter has otherwise
paid or become liable, to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 10(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The U.S. Underwriters' obligations
to contribute as provided in this Section 8(e) are several in proportion to
their respective underwriting obligations and not joint.
(e) The U.S. Underwriters severally confirm that the statements with
respect to the public offering of the Stock by the U.S. Underwriters set
forth on the cover page of, the legend concerning over-allotments on the
inside front cover page and the concession and reallowance figures
appearing under the caption "Underwriting" in, the Prospectus are correct
and constitute the only information concerning such U.S. Underwriters
furnished in writing to the Company by or on behalf of the U.S.
Underwriters or International Managers specifically for inclusion in the
Registration Statement and the Prospectus.
9. Defaulting Underwriters.
If, on either Delivery Date, any U.S. Underwriter defaults in the
performance of its obligations under this Agreement, the remaining non-
defaulting U.S. Underwriters shall be obligated to purchase the Stock which the
defaulting U.S. Underwriter agreed but failed to purchase on such Delivery Date
in the respective proportions which the number of shares of the Firm Stock set
opposite the name of each remaining non-defaulting U.S. Underwriter in Schedule
1 hereto bears to the total number of shares of the Firm Stock set opposite the
names of all the remaining non-defaulting U.S. Underwriters in Schedule I
hereto; provided, however, that the remaining non-defaulting U.S. Underwriters
shall not be obligated to purchase any of the Stock on such Delivery Date if the
total number of shares of the Stock which the defaulting U.S. Underwriter or
Underwriters agreed but failed to purchase on such date exceeds 9.09% of the
total number of shares of the Stock to be purchased on such Delivery Date, and
any remaining non-defaulting U.S. Underwriter shall not be obligated to purchase
more than 110% of the number of shares of the Stock which it agreed to purchase
on such Delivery Date pursuant to the terms of Section 2. If the foregoing
maximums are exceeded, the remaining non-defaulting U.S. Underwriters, or those
other underwriters satisfactory to the Representatives who so agree, shall have
the right, but shall not be obligated, to purchase, in such proportion as may be
agreed upon among them, all the Stock to be purchased on such Delivery Date. If
the remaining U.S. Underwriters or other underwriters satisfactory to the
Representatives do not elect to purchase the shares which the defaulting U.S.
Underwriter or Underwriters agreed but failed to purchase on such Delivery Date,
this Agreement (or, with respect to the Second Delivery Date, the obligation of
the U.S. Underwriters to purchase, and of the Company to sell, the Option Stock)
shall terminate without liability on the part of any non-defaulting U.S.
Underwriter or the
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Company, except that the Company will continue to be liable for the payment of
expenses to the extent set forth in Sections 6 and 11. As used in this
Agreement, the term "Underwriter" includes, for all purposes of this Agreement
unless the context requires otherwise, any party not listed in Schedule 1 hereto
who, pursuant to this Section 9, purchases Firm Stock which a defaulting U.S.
Underwriter agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting Underwriter of any
liability it may have to the Company for damages caused by its default. If
other underwriters are obligated or agree to purchase the Stock of a defaulting
or withdrawing Underwriter, either the Representatives or the Company may
postpone the Delivery Date for up to seven full business days in order to effect
any changes that in the opinion of counsel for the Company or counsel for the
Underwriters may be necessary in the Registration Statement, the Prospectus or
in any other document or arrangement.
10. Termination. The obligations of the U.S. Underwriters hereunder
may be terminated by the Representatives by notice given to and received by the
Company prior to delivery of and payment for the Firm Stock if, prior to that
time, any of the events described in Sections 9(i) or 9(j), shall have occurred
or the event described in Section 7(k) shall not have occurred or if the
Underwriters shall decline to purchase the Stock for any reason permitted under
this Agreement.
11. Reimbursement of Underwriters' Expenses. If (a) the Company
shall fail to tender the Stock for delivery to the U.S. Underwriters by reason
of any failure, refusal or inability on the part of the Company to perform any
agreement on its part to be performed, or because any other condition of the
U.S. Underwriters' obligations hereunder required to be fulfilled by the Company
is not fulfilled, the Company will reimburse the U.S. Underwriters for all
reasonable out-of-pocket expenses (including fees and disbursements of counsel)
incurred by the U.S. Underwriters in connection with this Agreement and the
proposed purchase of the Stock, and upon demand the Company shall pay the full
amount thereof to the Representatives. If this Agreement is terminated pursuant
to Section 9 by reason of the default of one or more Underwriters, the Company
shall not be obligated to reimburse any defaulting Underwriter on account of
those expenses.
12. Notices, etc. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail, telex
or facsimile transmission to Xxxxxx Brothers Inc., Three World Financial
Center, New York, New York 10285, Attention: Syndicate Department (Fax:
000-000-0000), with a copy, in the case of any notice pursuant to Section
8(d), to the Director of Litigation, Office of the General Counsel, Xxxxxx
Brothers Inc., 0 Xxxxx Xxxxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000,
with a copy to Xxxxx, Xxxxxxx & Xxxxxxxxx, LLP, 000 Xxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, Attention: Xxxxx X. Xxxxxx, Xx., Esq.;
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(b) if to the Company, shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: President (Fax: 000-000-0000), with a
copy to Brown, Rudnick, Freed & Gesmer, Xxx Xxxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, Attention: Xxxxxxxx X. Xxxx, Esq.;
provided, however, that any notice to an Underwriter pursuant to Section 8(d)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Representatives, which address will be supplied to any other party hereto by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company shall
be entitled to act and rely upon any request, consent, notice or agreement given
or made on behalf of the U.S. Underwriters by Xxxxxx Brothers Inc. on behalf of
the Representatives.
13. Persons Entitled to Benefit of Agreement. This Agreement shall
inure to the benefit of and be binding upon the U.S. Underwriters, the Company
and their respective personal representatives and successors. This Agreement
and the terms and provisions hereof are for the sole benefit of only those
persons, except that (A) the representations, warranties, indemnities and
agreements of the Company contained in this Agreement shall also be deemed to be
for the benefit of the person or persons, if any, who control any U.S.
Underwriter within the meaning of Section 15 of the Securities Act and for the
benefit of each International Manager (and controlling persons thereof) who
offers or sells shares of Common Stock in accordance with the terms of the
Agreement between U.S. Underwriters and International Managers and (B) the
indemnity agreement of the U.S. Underwriters contained in Section 8(c) of this
Agreement shall be deemed to be for the benefit of directors of the Company,
officers of the Company who have signed the Registration Statement and any
person controlling the Company within the meaning of Section 15 of the
Securities Act. Nothing in this Agreement is intended or shall be construed to
give any person, other than the persons referred to in this Section 13, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision contained herein.
14. Survival. The respective indemnities, representations,
warranties and agreements of the Company and the U.S. Underwriters contained in
this Agreement or made by or on behalf on them, respectively, pursuant to this
Agreement, shall survive the delivery of and payment for the Stock and shall
remain in full force and effect, regardless of any investigation made by or on
behalf of any of them or any person controlling any of them.
15. Definition of the Term "Business Day". For purposes of this
Agreement, "business day" means any day on which the New York Stock Exchange,
Inc. is open for trading.
16. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of New York.
17. Jurisdiction. The parties hereto each hereby irrevocably submits
to the jurisdiction of any New York state or federal court sitting in the city
of New York, New York County, in any action or proceeding arising out of or
relating to this Agreement and the parties
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hereto each hereby irrevocably agrees that all claims in respect of such action
or proceeding may be heard and determined in such New York state court or such
federal court. The parties hereto also each hereby irrevocably waives, to the
fullest extent it may effectively do so, the defense of an inconvenient forum to
the maintenance of such action or proceeding. The parties hereto each
irrevocably consent to the service of copies of the summons and complaint and
any other process which may be served in any such action or proceeding by
certified mail, return receipt requested, or by delivery of a copy of such
process to the parties at its address specified in Section 14 or by any other
method permitted by law. The parties hereto each agree that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or by any other manner provided by law.
18. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
19. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
[Remainder of Page Intentionally Left Blank]
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If the foregoing correctly sets forth the agreement among the Company and
the U.S. Underwriters, please indicate your acceptance in the space provided for
that purpose below.
Very truly yours,
VIVID TECHNOLOGIES, INC.
By
--------------------
President
Accepted:
XXXXXX BROTHERS INC.
XXXXX & COMPANY
XXXXXXX & COMPANY, INC.
For themselves and as
Representatives of the
several Underwriters
named in Schedule 1 hereto
By: XXXXXX BROTHERS INC.
By
---------------------
Authorized Representative
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SCHEDULE 1
Underwriters Number of Shares
------------ ----------------
Xxxxxx Brothers Inc......................
Xxxxx & Company..........................
Xxxxxxx & Company, Inc. .................
Total....................................
-----------------
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ANNEX A
Matters to be Covered in Opinion of Company Counsel
---------------------------------------------------
(i) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of its jurisdiction of
incorporation, is duly qualified to do business and is in good standing as
a foreign corporation in each jurisdiction in which its ownership or
leasing of property or the conduct of its business requires such
qualification (except where non-qualification would not have a material and
adverse affect on the business, properties, business prospects, condition
(financial or otherwise) or results of operations of the Company and its
subsidiaries taken as a whole (a "Material Adverse Effect")) and has the
corporate power and authority necessary to own or hold its properties and
conduct the businesses in which it is engaged; each of the U. S.
subsidiaries of the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation; is duly qualified to do business and is in
good standing as a foreign corporation in each jurisdiction in which its
ownership or leasing of property or the conduct of its business requires
such qualification (except where non-qualification would not have a
Material Adverse Effect) and has all corporate power and authority
necessary to own or hold its properties and conduct the business in which
it is engaged;
(ii) The Company has capital stock authorized and outstanding as set
forth in the Prospectus under the captions "Capitalization" and
"Description of Capital Stock," and all of the issued and outstanding
shares of capital stock of the Company (including the Stock delivered on
the date of such opinion when issued in accordance with the terms of the
Underwriting Agreement) have been duly authorized and validly issued, are
fully paid and non-assessable and conform, in all material respects, to the
description thereof contained in the Prospectus; the certificates for the
Stock are in due and proper form under Delaware law; and all of the issued
and outstanding shares of capital stock of each U. S. subsidiary of the
Company have been duly authorized and validly issued and are fully paid and
non-assessable and are owned of record, and to the best of such counsel's
knowledge beneficially, directly or indirectly by the Company, to the best
of such counsel's knowledge free and clear of all liens, encumbrances,
equities or claims;
(iii) There are no preemptive or other rights to subscribe for or to
purchase, nor any restriction upon the voting or transfer of, any shares of
Common Stock pursuant to the Company's charter or by-laws or any agreement
or other instrument known to such counsel;
(iv) To the best of such counsel's knowledge and other than as set
forth in the Prospectus, there are no legal or governmental proceedings
pending or threatened against the Company which are required to be
disclosed in the Prospectus;
(v) The Registration Statement, including any Rule 462(b) Registration
Statement, was declared effective under the Securities Act as of the date
and time
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specified in such opinion, the Prospectus was filed with the Commission
pursuant to the subparagraph of Rule 424(b) of the Rules and Regulations
specified in such opinion on the date specified therein and no stop order
suspending the effectiveness of the Registration Statement has been issued
and, to the knowledge of such counsel, no proceeding for that purpose is
pending or threatened by the Commission;
(vi) The Registration Statement, including any Rule 462(b)
Registration Statement, and the Prospectus and any further amendments or
supplements thereto (other than the financial statements and related
schedules and notes therein and other financial and statistical data, as to
which such counsel need express no opinion) comply as to form in all
material respects with the requirements of the Securities Act and the Rules
and Regulations, and when they were filed with the Commission complied as
to form in all material respects with the requirements of the Securities
Act and the Rules and Regulations (other than the financial statements and
related schedules and notes therein and other financial and statistical
data, as to which such counsel need express no opinion);
(vii) The statements under the captions "Description of Capital
Stock" and "Shares Eligible For Future Sale" in the Prospectus, insofar as
such statements constitute a summary of documents referred to therein or
matters of law, are accurate summaries in all material respects and fairly
and correctly present the information called for with respect to such
documents and matters;
(viii) To the best of such counsel's knowledge, there are no
contracts or other documents which are required to be described in the
Prospectus or filed as exhibits to the Registration Statement by the
Securities Act or by the Rules and Regulations which have not been
described or filed as exhibits to the Registration Statement;
(ix) This Agreement and the International Underwriting Agreement
have been duly authorized, executed and delivered by the Company;
(x) The issue and sale of the Stock being delivered on the date of
such opinion by the Company and the performance by the Company of its
obligations under this Agreement and the International Underwriting
Agreement and the consummation of the transactions contemplated hereby and
thereby do not conflict with or result in a material breach or violation of
any of the terms or provisions of, or constitute a material default under,
any indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument known to such counsel to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries
is bound or to which any of the property or assets of the Company or any of
its subsidiaries is subject, nor will such actions result in any violation
of the provisions of the charter or by-laws of the Company or any of its
subsidiaries or any statute or any order, rule or regulation known to such
counsel of any court or governmental agency or body having jurisdiction
over the Company or any of its subsidiaries or any of their properties or
assets; and, except for the registration of the Stock under the Securities
Act and such consents, approvals,
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authorizations, registrations or qualifications as may be required under
the Exchange Act, the rules and regulations of the NASD, and applicable
state or foreign securities laws in connection with the purchase and
distribution of the Stock by the U.S. Underwriters and International
Managers, no consent, approval, authorization or order of, or filing or
registration with, any such court or governmental agency or body is
required for the execution, delivery and performance of this Agreement or
the International Underwriting Agreement by the Company and the
consummation of the transactions contemplated hereby and thereby; and
(xi) To the best of such counsel's knowledge, there are no contracts,
agreements or understandings between the Company and any person granting
such person the right (other than rights which have been waived or
satisfied) to require the Company to file a registration statement under
the Securities Act with respect to any securities of the Company owned or
to be owned by such person or to require the Company to include such
securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Securities Act.
Such counsel shall also have furnished to the Representatives a
written statement, addressed to the U.S. Underwriters and the International
Managers and dated as of the applicable Closing Date to the effect that (x)
such counsel has acted as counsel to the Company in connection with the
preparation of the Registration Statement and in connection therewith has
participated in conferences with officers and other representatives of the
Company, and representatives of the independent public accountants for the
Company, at which conferences the contents of the Registration Statement
and the Prospectus and related matters were discussed, and (y) based on the
foregoing, no facts have come to the attention of such counsel which lead
it to believe that the Registration Statement or Prospectus, as of the
Effective Date, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading, or that any 462(b)
Registration Statement or the Prospectus, as of its date and as of a
Delivery Date, contains any untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under which
they were made, not misleading (provided that such counsel need express no
view with respect to the financial statements and the related schedules and
notes and other financial or statistical data included therein). The
foregoing opinion and statement may be qualified by a statement to the
effect that such counsel does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement, any 462(b) Registration Statement or the Prospectus
except for the statements made in the Prospectus under the captions
"Description of Capital Stock" and "Shares Eligible For Future Sale"
insofar as such statements relate to the Stock and concern legal matters.
-29-
ANNEX B
-------
Matters to be Covered in Opinion of Patent Counsel to the Company
-----------------------------------------------------------------
(i) Schedules I and II to such opinion identify, as of
[applicable Closing Date], all U.S. patents and U.S. patent applications
known to such counsel and filed by the Company in which the Company
currently has an interest. As of [recent specified date], the Company was
listed in the records of the U.S. Patent and Trademark Office (the "PTO")
as a holder of record of each of the patents and patent applications listed
in Schedule I. The patent rights to the patents and patent applications
listed in Schedule I, to the best of such counsel's knowledge, have been
assigned to the Company. Based on a search of the documents of record in
the PTO as of [recent specified date], a review of the Company records
through that date, and a review of the certificate of an officer of the
Company, such counsel has no knowledge of any facts which would preclude
the Company from having clear title to the patents and patent applications
listed in Schedule I. As of [recent specified date], the Company was a
licensee of each of the patents and patent applications listed in Schedule
II. The patent rights to the patents and patent applications listed in
Schedule II, to the best of such counsel's knowledge, have been assigned to
the licensor of each such patent or patent application. Based on a search
of the documents of record in the PTO as of [recent specified date], such
counsel has no knowledge of any facts which would preclude the Company from
having valid license rights under the patents and patent applications
listed in Schedule II.
(ii) To the best of such counsel's knowledge, none of the claims
of the patents set forth in Schedules I and II is invalid or unenforceable.
Each of the applications set forth in Schedule[s] I [and II] is pending in
the PTO, and such counsel is unaware of any defects in the prosecution of
any such application that would irrevocably foreclose the grant of patent
rights thereunder.
(iii) To the best of such counsel's knowledge, other than the
actions pending in the United States District Court between the Company and
EG&G (the "EG&G Action") and between the Company and AS&E (the "AS&E
Action"), there is no pending or threatened action, suit, proceeding, or
claim by others that the Company is infringing any patent.
(iv) To the best of such counsel's knowledge, other than review
of pending patent applications and the EG&G Action, there are no legal or
governmental proceedings pending relating to the patents or applications
set forth in Schedules I and II, other than review of pending applications
for patent, including appeal proceedings, and to the best of such counsel's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or others.
(v) To the best of such counsel's knowledge, other than the EG&G
Action, there is no pending action, suit, proceeding or claim by others
challenging the validity or enforceability of any claim of the patents set
forth in Schedules I and II. To
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the best of such counsel's knowledge, there is no interference proceeding
or public use proceeding with respect to any patent or patent application
set forth in Schedules I or II.
(vi) Based on a review of material including U.S. Patent No.
4,366,382 and the Company's automated inspection systems as they have been
and are currently made, no valid claim of U.S. Patent No. 4,366,382 is
infringed by such systems.
(vii) Based on a review of material including U.S. Patent Nos.
4,482,957; 4,511,799; 4,768,214; 4,799,247; 4,825,454; 4,893,015;
5,253,283; and 5,313,511 and the Company's automated inspection systems as
they have been and are made, no valid claim of such patents is infringed by
such systems.
