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EXHIBIT 1.1
SUPERIOR CONSULTANT HOLDINGS CORPORATION
2,150,000 Shares Common Stock(1)
Underwriting Agreement
October __, 1996
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
Xxxxxxxxx & Company, Inc.
As Representatives of the Several
Underwriters Named in Schedule A
c/o Xxxxxxx Xxxxx & Company, L.L.C.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
Section 1. Introductory. Superior Consultant Holdings Corporation
("Company") a Delaware corporation, has an authorized capital stock consisting
of 1,000,000 shares of Preferred Stock, $0.01 par value, of which no shares are
outstanding on the date hereof and 30,000,000 shares, $0.01 par value, of
Common Stock ("Common Stock"), of which 4,836,112 shares are outstanding on the
date hereof. The Company proposes to issue and sell 2,150,000 shares of its
authorized but unissued Common Stock (the "Firm Shares") to the several
underwriters named in Schedule A as it may be amended by the Pricing Agreement
hereinafter defined ("Underwriters"), who are acting severally and not jointly.
In addition, the Company and certain stockholders of the Company (collectively
referred to as the "Selling Stockholders" and named in Schedule B) propose to
grant to the Underwriters an option to purchase up to 322,500 additional shares
of Common Stock ("Option Shares") as provided in Section 5 hereof. The Firm
Shares and, to the extent such option is exercised, the Option Shares, are
hereinafter collectively referred to as the "Shares."
You have advised the Company and the Selling Stockholders that the
Underwriters propose to make a public offering of their respective portions of
the Shares as soon as you deem advisable after the registration statement
hereinafter referred to becomes effective, if it
________________________
(1)Plus an option to acquire up to 322,500 additional shares to cover
overallotments.
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has not yet become effective, and the Pricing Agreement hereinafter defined has
been executed and delivered.
Prior to the purchase and public offering of the Shares by the several
Underwriters, the Company, the Selling Stockholders and the Representatives
identified above, acting on behalf of the several Underwriters, shall enter
into an agreement substantially in the form of Exhibit A hereto ("Pricing
Agreement"). The Pricing Agreement may take the form of an exchange of any
standard form of written telecommunication between the Company, the Selling
Stockholders and the Representatives and shall specify such applicable
information as is indicated in Exhibit A hereto. The offering of the Shares
will be governed by this Agreement, as supplemented by the Pricing Agreement.
From and after the date of the execution and delivery of the Pricing Agreement,
this Agreement shall be deemed to incorporate the Pricing Agreement.
The Company and each of the Selling Stockholders hereby confirm their
agreements with the Underwriters as follows:
Section 2. Representations and Warranties of the Company. The
Company represents and warrants to the several Underwriters that:
(a) A registration statement on Form S-1 (File No. 333-10213)
and a related preliminary prospectus with respect to the Shares have
been prepared and filed with the Securities and Exchange Commission
("Commission") by the Company in conformity with the requirements of
the Securities Act of 1933, as amended, and the rules and regulations
of the Commission thereunder (collectively, the "1933 Act;" unless
indicated to the contrary, all references herein to specific rules are
rules promulgated under the 0000 Xxx); and the Company has so prepared
and has filed such amendments thereto, if any, and such amended
preliminary prospectuses as may have been required to the date hereof
and will file such additional amendments thereto and such amended
prospectuses as may hereafter be required. If the Company has elected
not to rely upon Rule 430A, the Company has prepared and will promptly
file an amendment to the registration statement and an amended
prospectus. If the Company has elected to rely upon Rule 430A, it
will prepare and file a prospectus pursuant to Rule 424(b) that
discloses the information previously omitted from the prospectus in
reliance upon Rule 430A. There have been or will promptly be
delivered to you three signed copies of such registration statement
and amendments, three copies of each exhibit filed therewith, and
conformed copies of such registration statement and amendments (but
without exhibits) and of the related preliminary prospectus or
prospectuses and final forms of prospectus for each of the
Underwriters.
Such registration statement (as amended, if
applicable) at the time it becomes effective and the prospectus
constituting a part thereof (including the
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information, if any, deemed to be part thereof pursuant to Rule
430A(b) and/or Rule 434), as from time to time amended or
supplemented, are hereinafter referred to as the "Registration
Statement," and the "Prospectus," respectively, except that if any
revised prospectus shall be provided to the Underwriters by the
Company for use in connection with the offering of the Shares which
differs from the Prospectus on file at the Commission at the time the
Registration Statement became or becomes effective (whether or not
such revised prospectus is required to be filed by the Company
pursuant to Rule 424(b)), the term Prospectus shall refer to such
revised prospectus from and after the time it was provided to the
Underwriters for such use. If the Company elects to rely on Rule 434
of the 1933 Act, all references to "Prospectus" shall be deemed to
include, without limitation, the form of prospectus and the term
sheet, taken together, provided to the Underwriters by the Company in
accordance with Rule 434 of the 1933 Act ("Rule 434 Prospectus"). Any
registration statement (including any amendment or supplement thereto
or information which is deemed part thereof) filed by the Company
under Rule 462(b) ("Rule 462(b) Registration Statement") shall be
deemed to be part of the "Registration Statement" as defined herein,
and any prospectus (including any amendment or supplement thereto or
information which is deemed part thereof) included in such
registration statement shall be deemed to be part of the "Prospectus",
as defined herein, as appropriate. The Securities Exchange Act of
1934, as amended, and the rules and regulations of the Commission
thereunder are hereinafter collectively referred to as the "Exchange
Act."
(b) The Commission has not issued any order preventing or
suspending the use of any preliminary prospectus, and each preliminary
prospectus has conformed in all material respects with the
requirements of the 1933 Act and, as of its date, has not included any
untrue statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and when the
Registration Statement became or becomes effective, and at all times
subsequent thereto, up to the First Closing Date or the Second Closing
Date hereinafter defined, as the case may be, the Registration
Statement, including the information deemed to be part of the
Registration Statement at the time of effectiveness pursuant to Rule
430A(b), if applicable, and the Prospectus and any amendments or
supplements thereto, contained or will contain all statements that are
required to be stated therein in accordance with the 1933 Act and in
all material respects conformed or will in all material respects
conform to the requirements of the 1933 Act, and neither the
Registration Statement nor the Prospectus, nor any amendment or
supplement thereto, included or will include any untrue statement of a
material fact or omitted or will omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that the Company makes no
representation or warranty as to information contained in or omitted
from any preliminary prospectus, the Registration Statement, the
Prospectus or any such amendment or supplement in
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reliance upon and in conformity with written information furnished to
the Company by or on behalf of any Underwriter through the
Representatives specifically for use in the preparation thereof.
(c) The Company and its subsidiaries have been duly
incorporated and are validly existing as corporations in good standing
under the laws of their respective places of incorporation, with
corporate power and authority to own their properties and conduct
their business as described in the Prospectus; the Company and each of
its subsidiaries are duly qualified to do business as foreign
corporations under the corporation law of, and are in good standing as
such in, each jurisdiction in which they own or lease substantial
properties, have an office, or in which substantial business is
conducted and such qualification is required except in any such case
where the failure to so qualify or be in good standing would not have
a material adverse effect upon the Company and its subsidiaries taken
as a whole; and no proceeding of which the Company has knowledge has
been instituted in any such jurisdiction, revoking, limiting or
curtailing, or seeking to revoke, limit or curtail, such power and
authority or qualification.
(d) Except as disclosed in the Registration Statement, the
Company owns directly or indirectly 100 percent of the issued and
outstanding capital stock of each of its subsidiaries, free and clear
of any claims, liens, encumbrances, security interests or rights of
first refusal and all of such capital stock has been duly authorized
and validly issued and is fully paid and nonassessable. There are no
outstanding options, preemptive rights, subscriptions, warrants,
calls, rights of first refusal or other agreements with respect to the
capital stock of either subsidiary.
(e) The issued and outstanding shares of capital stock of the
Company as set forth in the Prospectus have been duly authorized and
validly issued, are fully paid and nonassessable, and conform to the
description thereof contained in the Prospectus.
(f) The Shares to be sold by the Company have been duly
authorized and when issued, delivered and paid for pursuant to this
Agreement, will be validly issued, fully paid and nonassessable, and
will conform to the description thereof contained in the Prospectus.
(g) The making and performance by the Company of this
Agreement and the Pricing Agreement have been duly authorized by all
necessary corporate action and will not violate any provision of the
Company's charter or bylaws and will not result in the breach, or be
in contravention, of any provision of any agreement, franchise,
license, indenture, mortgage, deed of trust, or other instrument to
which the Company or any subsidiary is a party or by which the
Company, any subsidiary or the property of any of them may be bound or
affected, or any order, rule or regulation applicable to
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the Company or any subsidiary of any court or regulatory body,
administrative agency or other governmental body having jurisdiction
over the Company or any subsidiary or any of their respective
properties, or any order of any court or governmental agency or
authority entered in any proceeding to which the Company or any
subsidiary was or is now a party or by which it is bound. No consent,
approval, authorization or other order of any court, regulatory body,
administrative agency or other governmental body is required for the
execution and delivery of this Agreement or the Pricing Agreement or
the consummation of the transactions contemplated herein or therein,
except for compliance with the 1933 Act, the Exchange Act and blue sky
laws applicable to the public offering of the Shares by the several
Underwriters and clearance of such offering with the National
Association of Securities Dealers, Inc. ("NASD"). This Agreement has
been duly executed and delivered by the Company.
(h) The accountants who have expressed their opinions with
respect to certain of the financial statements and schedules included
in the Registration Statement are independent accountants as required
by the 1933 Act.
(i) The consolidated financial statements and schedules of
the Company included in the Registration Statement present fairly the
consolidated financial position of the Company as of the respective
dates of such financial statements, and the consolidated results of
operations and cash flows of the Company for the respective periods
covered thereby, all in conformity with generally accepted accounting
principles consistently applied throughout the periods involved except
as disclosed in the Prospectus and the supporting schedules included
in the Registration Statement present fairly the information required
to be stated therein. The financial information set forth in the
Prospectus under "Selected Consolidated Financial and Operating Data"
and "Summary Consolidated Financial and Operating Data" presents
fairly on the basis stated in the Prospectus, the information set
forth therein.
The pro forma information included in the Prospectus
(i) presents fairly the information shown therein, (ii) has been
prepared in all material respects in accordance with generally
accepted accounting principles, (iii) has been prepared in accordance
with the Commission's rules and guidelines with respect to pro forma
information, (iv) has been properly compiled on the pro forma basis
described therein, and, (v) in the opinion of the Company, the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate under the circumstances.
(j) Neither the Company nor any subsidiary is in violation of
its charter or in default under any consent decree, or in default with
respect to any provision of any lease, loan agreement, franchise,
license, permit or other contract obligation to which it is a party
that would or could be expected to have a material adverse effect upon
the
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condition (financial or otherwise) or results of operations of the
Company and its subsidiaries taken as a whole; and there does not
exist any state of facts which constitutes an event of default as
defined in such documents or which, with notice or lapse of time or
both, would constitute such an event of default, in each case, except
for defaults which neither singly nor in the aggregate are material to
the Company and its subsidiaries taken as a whole.
(k) There are no material legal or governmental proceedings
pending, or to the Company's knowledge, threatened to which the
Company or any subsidiary is or may be a party or of which material
property owned or leased by the Company or any subsidiary is or may be
the subject, or related to environmental or discrimination matters
which are not disclosed in the Prospectus, or which question the
validity of this Agreement or the Pricing Agreement or any action
taken or to be taken pursuant hereto or thereto.
(l) There are no holders of securities of the Company having
rights to registration thereof, preemptive rights or rights of first
refusal to purchase Common Stock.
(m) The Company and each of its subsidiaries have good and
marketable title to all the properties and assets reflected as owned
in the financial statements hereinabove described (or elsewhere in the
Prospectus), subject to no lien, mortgage, pledge, charge or
encumbrance of any kind except those, if any, reflected in such
financial statements (or elsewhere in the Prospectus) or which are not
material to the Company and its subsidiaries taken as a whole. The
Company and each of its subsidiaries hold their respective leased
properties which are material to the Company and its subsidiaries
taken as a whole under valid and binding leases.
(n) The Company has not taken and will not take, directly or
indirectly, any action designed to or which has constituted or which
might reasonably be expected to cause or result, under the Exchange
Act or otherwise, in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Shares.
(o) Subsequent to the respective dates as of which
information is given in the Registration Statement and Prospectus, and
except as contemplated by the Prospectus, the Company and its
subsidiaries, taken as a whole, have not incurred any material
liabilities or obligations, direct or contingent, nor entered into any
material transactions not in the ordinary course of business and there
has not been any material adverse change in their condition (financial
or otherwise) or results of operations nor any material change in
their capital stock, short-term debt or long-term debt.
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(p) The Company agrees not to sell, contract to sell or
otherwise dispose of any Common Stock or securities convertible into
Common Stock for a period of 180 days after this Agreement becomes
effective without the prior written consent of Xxxxxxx Xxxxx &
Company,L.L.C.; provided, however, that the Company may (i) grant
options under its Long-Term Incentive Plan, and (ii) issue warrants
and options in connection with client agreements and business
affiliations and ventures. The Company has obtained similar
agreements from each of its officers, directors and stockholders
(except with respect to (i) the sale of up to an aggregate of 25,000
shares, in the event such shares are not sold as Option Shares, to
fund the tax impact and exercise price related to options exercised
prior to the offering (ii) bona fide gifts of shares of Common Stock
provided that the donee or donees agree in writing to be bound by the
restrictions described above, and (iii) if such person is an
individual, dispositions to members of his or her immediate family or
to a trust the beneficiaries of which are exclusively such person
and/or a member or members of his or her immediate family provided
that each transferee agrees in writing to be bound by the restrictions
described above).
(q) There is no material document of a character required to
be described in the Registration Statement or the Prospectus or to be
filed as an exhibit to the Registration Statement which is not
described or filed as required.
(r) The Company together with its subsidiaries owns and
possesses all right, title and interest in and to, or has duly
licensed from third parties, all patents, patent rights, trade
secrets, inventions, know-how, trademarks, trade names, copyrights,
service marks and other proprietary rights ("Trade Rights") material
to the business of the Company and each of its subsidiaries taken as a
whole. Neither the Company nor any of its subsidiaries has received
any notice of infringement, misappropriation or conflict from any
third party as to such material Trade Rights which has not been
resolved or disposed of and neither the Company nor any of its
subsidiaries has infringed, misappropriated or otherwise conflicted
with material Trade Rights of any third parties, which infringement,
misappropriation or conflict would have a material adverse effect upon
the condition (financial or otherwise) or results of operations of the
Company and its subsidiaries taken as a whole.
(s) The conduct of the business of the Company and each of
its subsidiaries is in compliance in all respects with applicable
federal, state, local and foreign laws and regulations, except where
the failure to be in compliance would not have a material adverse
effect upon the condition (financial or otherwise) or results of
operations of the Company and its subsidiaries taken as a whole.
(t) All offers and sales of the Company's capital stock prior
to the date hereof were at all relevant times exempt from the
registration requirements of the 1933 Act
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and were duly registered with or the subject of an available exemption
from the registration requirements of the applicable state securities
or blue sky laws.
(u) The Company has filed all necessary federal and state
income and franchise tax returns and has paid all taxes shown as due
thereon, and there is no tax deficiency that has been, or to the
knowledge of the Company might be, asserted against the Company or any
of its properties or assets that would or could be expected to have a
material adverse affect upon the condition (financial or otherwise) or
results of operations of the Company and its subsidiaries taken as a
whole.
(v) The Company has filed a registration statement pursuant
to Section 12(g) of the Exchange Act to register the Common Stock
thereunder, has filed an application to list the Shares on the Nasdaq
National Market, and has received notification that the listing has
been approved, subject to notice of issuance or sale of the Shares, as
the case may be.
(w) The Company is not, and does not intend to conduct its
business in a manner in which it would become, an "investment company"
as defined in Section 3(a) of the Investment Company Act of 1940, as
amended ("Investment Company Act").
(x) The Company confirms as of the date hereof that it is in
compliance with all provisions of Section 1 of Laws of Florida,
Chapter 92-198, An Act Relating to Disclosure of Doing Business with
Cuba, and the Company further agrees that if it commences engaging in
business with the government of Cuba or with any person or affiliate
located in Cuba after the date the Registration Statement becomes or
has become effective with the Commission or with the Florida
Department of Banking and Finance (the "Department"), whichever date
is later, or if the information reported in the Prospectus, if any,
concerning the Company's business with Cuba or with any person or
affiliate located in Cuba changes in any material way, the Company
will provide the Department notice of such business or change, as
appropriate, in a form acceptable to the Department.
(y) Each of Superior Consultant Company, Inc. and UNITIVE
Corporation (collectively, the "operating companies") and the Company
had the requisite corporate power and authority to carry out the
corporate reorganization described under the caption "Prospectus
Summary" in the Prospectus (such transaction being referred to herein
as the "Merger"), and each of the Company and the operating companies
and the stockholders of each of them have taken all action required by
law, their respective charter and bylaws or otherwise to approve the
Merger.
(z) The consummation of the Merger did not or will not
contravene any provision of applicable law or the respective charter
or bylaws of the Company, or
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either of the operating companies (except to the extent the Company
has obtained the requisite consent) any provision of any material
agreement or other material instrument binding upon the Company or
either of the operating companies or any order, writ, injunction or
decree of any jurisdiction, court or governmental body, and no
consent, approval, authorization or order of any court or governmental
agency or body is or was required in connection with the Merger,
except such as have been obtained. The Merger will be duly and
validly consummated and will be effective prior to the First Closing
Date.
(aa) Superior and its stockholders have made a valid election
pursuant to Section 1362(a) of the Internal Revenue Code of 1986, as
amended (the "Code") to be an "S corporation" within the meaning of
Section 1361(a)(1) of the Code for all taxable periods beginning after
January 1, 1987 and no event has occurred during such period that
would result in a termination of such election; Superior has no
material federal corporate income tax liability for the period from
January 1, 1987 to the termination of the election to be an S
corporation which termination will occur on the day after this
Agreement is executed. Unitive and its stockholders made a valid
election pursuant to Section 1362(a) of the Code to be an "S
corporation" within the meaning of Section 1361(a)(1) of the Code for
all taxable periods beginning after _______________ and ending January
1, 1995 and no event has occurred during such period that would result
in a termination of such election; Unitive has no material federal
corporate income tax liability for the period from ______________ to
January 1, 1995.
Section 3. Representations, Warranties and Covenants of the Selling
Stockholders.
(a) Each Selling Stockholder severally and not jointly
represents and warrants (with respect to himself or herself alone) to,
and agrees with, the Company and the Underwriters that:
(i) Such Selling Stockholder has, and on the First Closing
Date or the Second Closing Date (as hereinafter defined), as the case
may be, will have, valid marketable title to the Shares proposed to be
sold by such Selling Stockholder hereunder on such date and full
right, power and authority to enter into this Agreement and the
Pricing Agreement and to sell, assign, transfer and deliver such
Shares hereunder, free and clear of all voting trust arrangements,
liens, encumbrances, equities, claims and community property rights;
and upon delivery of and payment for such Shares hereunder, the
Underwriters will acquire valid marketable title thereto, free and
clear of all voting trust arrangements, liens, encumbrances, equities,
claims and community property rights.
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(ii) Such Selling Stockholder has not taken and will not
take, directly or indirectly, any action designed to or which might be
reasonably expected to cause or result, under the Exchange Act or
otherwise, in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Shares.
(iii) Such Selling Stockholder has executed and delivered a
Power of Attorney ("Power of Attorney") among the Selling Stockholder,
____________, ________________, and ______________ (the "Agents"),
naming the Agents as such Selling Stockholder's attorneys-in-fact
(and, by the execution by any Agent of this Agreement, such Agent
hereby represents and warrants that he has been duly appointed as
attorney-in-fact by the Selling Stockholders pursuant to the Power of
Attorney) for the purpose of entering into and carrying out this
Agreement and the Pricing Agreement, and the Power of Attorney has
been duly executed by, and is a valid and binding agreement of, such
Selling Stockholder and a copy thereof has been delivered to you.
(iv) Such Selling Stockholder further represents, warrants
and agrees that such Selling Stockholder has deposited in custody,
under a Custody Agreement ("Custody Agreement") with
_____________________________, as custodian ("Custodian"),
certificates in negotiable form for the Shares to be sold hereunder by
such Selling Stockholder, for the purpose of further delivery pursuant
to this Agreement. Such Selling Stockholder agrees that the Shares to
be sold by such Selling Stockholder on deposit with the Custodian are
subject to the interests of the Company, the Underwriters and the
other Selling Stockholders, that the arrangements made for such
custody, and the appointment of the Agents pursuant to the Power of
Attorney, are to that extent irrevocable, and that the obligations of
such Selling Stockholder hereunder and under the Power of Attorney and
the Custody Agreement shall not be terminated except as provided in
this Agreement, the Power of Attorney or the Custody Agreement by any
act of such Selling Stockholder, by operation of law, whether, in the
case of an individual Selling Stockholder, by the death or incapacity
of such Selling Stockholder or, in the case of a trust or estate, by
the death of the trustee or trustees or the executor or executors or
the termination of such trust or estate, or, in the case of a
partnership or corporation, by the dissolution, winding-up or other
event affecting the legal life of such entity, or by the occurrence of
any other event. If any individual Selling Stockholder, trustee or
executor should die or become incapacitated, or any such trust,
estate, partnership or corporation should be terminated, or if any
other event should occur before the delivery of the Shares hereunder,
the documents evidencing Shares then on deposit with the Custodian
shall be delivered by the Custodian in accordance with the terms and
conditions of this Agreement as if such death, incapacity, termination
or other event had not occurred, regardless of whether or not the
Custodian shall have received notice thereof. Each Agent has been
authorized by such Selling Stockholder to execute and deliver this
Agreement and the Pricing
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Agreement and the Custodian has been authorized to receive and
acknowledge receipt of the proceeds of sale of the Shares to be sold
by such Selling Stockholder against delivery thereof and otherwise act
on behalf of such Selling Stockholder. The Custody Agreement has been
duly executed by, and is a valid and binding obligation of, such
Selling Stockholder and a copy thereof has been delivered to you.
(v) Each preliminary prospectus, insofar as it relates to
such Selling Stockholder as of its date, has conformed in all material
respects with the requirements of the 1933 Act and, as of its date,
has not included any untrue statement of a material fact or omitted to
state a material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
and the Registration Statement at the time of effectiveness, and at
all times subsequent thereto, up to the First Closing Date or the
Second Closing Date hereinafter defined, as the case may be, (1) such
parts of the Registration Statement and the Prospectus and any
amendments or supplements thereto as relate to such Selling
Stockholder, and the Registration Statement and the Prospectus and any
amendments or supplements thereto, to the knowledge of such Selling
Stockholder in all other respects, contained or will contain all
statements that are required to be stated therein in accordance with
the 1933 Act and in all material respects conformed or will in all
material respects conform to the requirements of the 1933 Act, and (2)
neither the Registration Statement nor the Prospectus, nor any
amendment or supplement thereto, as it relates to such Selling
Stockholder, and, to the knowledge of such Selling Stockholder in all
other respects, included or will include any untrue statement of a
material fact or omitted or will omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading; provided that neither clause (1) nor (2) shall
have any effect if information has been given by such Selling
Stockholder to the Company and the Representatives in writing which
would eliminate or remedy any such untrue statement or omission.
(vi) Such Selling Stockholder agrees with the Company and the
Underwriters not to sell, contract to sell or otherwise dispose of any
Common Stock for a period of 180 days after this Agreement becomes
effective without the prior written consent of Xxxxxxx Xxxxx &
Company, L.L.C.; provided, however, that each Selling Stockholder may
(i) make bona fide gifts of shares of Common Stock provided that the
donee or donees agree in writing to be bound by the restrictions
described above, and (ii) if the Selling Stockholder is an individual,
make dispositions to members of his or her immediate family or to a
trust the beneficiaries of which are exclusively such person and/or a
member or members of his or her immediate family provided that each
transferee agrees in writing to be bound by the restrictions described
above, and (iii) together with all other persons who are exercising
options in connection with, or immediately prior to, the offering may,
with the prior consent of the Company, sell up to an aggregate of
25,000 shares of Common Stock (provided, that each Selling
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Stockholder may only sell a number of shares of Common Stock which
will generate net proceeds which are sufficient to pay the exercise
price of such Selling Stockholder's options and the income tax payable
by such Selling Stockholder as a result of the exercise of such
options).
(b) Each of Xxxxxxx X. Xxxxxxx, Xx., Xxxxxxx X. Xxxxxxx and
Xxxxxx X. Xxxxxxx severally represents and warrants to, and agrees with, the
Underwriters to the same effect as the representations and warranties of the
Company set forth in Section 2 of this Agreement.
(c) In order to document the Underwriters' compliance with
the reporting and withholding provisions of the Internal Revenue Code of 1986,
as amended, with respect to the transactions herein contemplated, each of the
Selling Stockholders agrees to deliver to you prior to or on the Second Closing
Date, as hereinafter defined, a properly completed and executed United States
Treasury Department Form W-8 or W-9 (or other applicable form of statement
specified by Treasury Department regulations in lieu thereof).
Section 4. Representations and Warranties of the Underwriters. The
Representatives, on behalf of the several Underwriters, represent and warrant
to the Company and the Selling Stockholders that the information set forth (a)
on the cover page of the Prospectus with respect to price, underwriting
discount and terms of the offering, (b) in the last paragraph of page 2
concerning stabilization and over-allotment by the Underwriters, and (c) under
"Underwriting" in the Prospectus was furnished to the Company by and on behalf
of the Underwriters for use in connection with the preparation of the
Registration Statement and does not include any untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.
Section 5. Purchase, Sale and Delivery of Shares. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Company agrees to sell to the
Underwriters named in Schedule A hereto, and the Underwriters agree, severally
and not jointly, to purchase 2,150,000 Firm Shares from the Company at the
price per share set forth in the Pricing Agreement. The obligation of each
Underwriter to the Company shall be to purchase from the Company that number of
full shares which is set forth opposite the name of such Underwriter in
Schedule A hereto. The initial public offering price and the purchase price
shall be set forth in the Pricing Agreement.
At 9:00 A.M., Chicago Time, on the fourth business day, if permitted
under Rule 15c6-1 under the Exchange Act, (or the third business day if
required under Rule 15c6-1 under the Exchange Act or unless postponed in
accordance with the provisions of Section 12) following the date the
Registration Statement becomes effective (or, if the Company has elected to
rely upon Rule 430A, the fourth business day, if permitted under Rule 15c6-1
under the Exchange Act, (or the third business day if required under Rule
15c6-1 under the
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Xxxxxxxx Xxx) after execution of the Pricing Agreement), or such other time not
later than ten business days after such date as shall be agreed upon by the
Representatives and the Company, the Company will deliver to you through the
facilities of The Depository Trust Company for the accounts of the several
Underwriters, certificates representing the Firm Shares against payment of the
purchase price therefor by delivery of federal or other immediately available
funds, by wire transfer or otherwise, to the Company. Such time of delivery
and payment is herein referred to as the "First Closing Date." The certificates
for the Firm Shares so to be delivered will be in such denominations and
registered in such names as you request by notice to the Company prior to 10:00
A.M., Chicago Time, on the second business day preceding the First Closing
Date, and will be made available at the Company's expense for checking and
packaging by the Representatives at 10:00 A.M., Chicago Time, on the business
day preceding the First Closing Date. Payment for the Firm Shares so to be
delivered shall be made at the time and in the manner described above at the
offices of counsel for the Underwriters.
In addition, on the basis of the representations, warranties and
agreements herein contained, but subject to the terms and conditions herein set
forth, the Company and the Selling Stockholders hereby grant an option to the
several Underwriters to purchase, severally and not jointly, up to an aggregate
of 322,500 Option Shares, at the same purchase price per share to be paid for
the Firm Shares, for use solely in covering any overallotments made by the
Underwriters in the sale and distribution of the Firm Shares. The option
granted hereunder may be exercised at any time (but not more than once) within
30 days after the date of the initial public offering upon notice by you to the
Company and the Agents setting forth the aggregate number of Option Shares as
to which the Underwriters are exercising the option, the names and
denominations in which the certificates for such shares are to be registered
and the time and place at which such certificates will be delivered. Such time
of delivery (which may not be earlier than the First Closing Date), being
herein referred to as the "Second Closing Date," shall be determined by you,
but if at any time other than the First Closing Date, shall not be earlier than
three nor later than 10 full business days after delivery of such notice of
exercise. The number of Option Shares to be purchased from the Company and
each such Selling Stockholder are set forth in Schedule B hereto. If less than
all Option Shares are purchased such Shares shall be purchased (a) first, from
the Selling Stockholders (pro rata in proportion to the number of Shares set
forth opposite the name of such Selling Stockholder on Schedule B), and (b)
second, from the Company. The number of Option Shares to be purchased by each
Underwriter shall be determined by multiplying the number of Option Shares to
be sold by the Company and the Selling Stockholders pursuant to such notice of
exercise by a fraction, the numerator of which is the number of Firm Shares to
be purchased by such Underwriter as set forth opposite its name in Schedule A
and the denominator of which is the total number of Firm Shares (subject to
such adjustments to eliminate any fractional share purchases as you in your
absolute discretion may make). Certificates for the Option Shares will be made
available at the Company's expense for checking and packaging at 10:00 A.M.,
Chicago Time, on the business day preceding the
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Second Closing Date. The manner of payment for and delivery of the Option
Shares shall be the same as for the Firm Shares as specified in the preceding
paragraph.
You have advised the Company and the Selling Stockholders that each
Underwriter has authorized you to accept delivery of its Shares, to make
payment and to receipt therefor. You, individually and not as the
Representatives of the Underwriters, may make payment for any Shares to be
purchased by any Underwriter whose funds shall not have been received by you by
the First Closing Date or the Second Closing Date, as the case may be, for the
account of such Underwriter, but any such payment shall not relieve such
Underwriter from any obligation hereunder.
Section 6. Covenants of the Company. The Company covenants and
agrees that:
(a) The Company will advise you promptly of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the institution of any proceedings for
that purpose, or of any notification of the suspension of
qualification of the Shares for sale in any jurisdiction or the
initiation or threatening of any proceedings for that purpose, and
will also advise you and the Selling Stockholders promptly of any
request of the Commission for amendment or supplement of the
Registration Statement, of any preliminary prospectus or of the
Prospectus, or for additional information.
(b) The Company will give you notice of its intention to file
or prepare any amendment to the Registration Statement (including any
post-effective amendment) or any Rule 462(b) Registration Statement or
any amendment or supplement to the Prospectus (including any revised
prospectus which the Company proposes for use by the Underwriters in
connection with the offering of the Shares which differs from the
prospectus on file at the Commission at the time the Registration
Statement became or becomes effective, whether or not such revised
prospectus is required to be filed pursuant to Rule 424(b) and any
term sheet as contemplated by Rule 434) and will furnish you and the
Selling Stockholders with copies of any such amendment or supplement a
reasonable amount of time prior to such proposed filing or use, as the
case may be, and will not file any such amendment or supplement or use
any such prospectus to which you or counsel for the Underwriters shall
reasonably object.
(c) If the Company elects to rely on Rule 434 of the 1933
Act, the Company will prepare a term sheet that complies with the
requirements of Rule 434. If the Company elects not to rely on Rule
434, the Company will provide the Underwriters with copies of the form
of prospectus, in such numbers as the Underwriters may reasonably
request, and file with the Commission such prospectus in accordance
with Rule 424(b) of the 1933 Act within the time period prescribed by
such rule. If the Company elects to rely on Rule 434, the Company
will provide the Underwriters with
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copies of the form of Rule 434 Prospectus, in such numbers as the
Underwriters may reasonably request, by the close of business in New
York on the business day immediately succeeding the date of the
Pricing Agreement.
(d) If at any time when a prospectus relating to the Shares
is required to be delivered under the 1933 Act any event occurs as a
result of which the Prospectus, including any amendments or
supplements, would include an untrue statement of a material fact, or
omit to state any material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus, including any
amendments or supplements thereto and including any revised prospectus
which the Company proposes for use by the Underwriters in connection
with the offering of the Shares which differs from the prospectus on
file with the Commission at the time of effectiveness of the
Registration Statement, whether or not such revised prospectus is
required to be filed pursuant to Rule 424(b) to comply with the 1933
Act, the Company promptly will advise you thereof and will promptly
prepare and file with the Commission an amendment or supplement which
will correct such statement or omission or an amendment which will
effect such compliance; and, in case any Underwriter is required to
deliver a prospectus nine months or more after the effective date of
the Registration Statement, the Company upon request, but at the
expense of such Underwriter, will prepare promptly such prospectus or
prospectuses as may be necessary to permit compliance with the
requirements of Section 10(a)(3) of the 1933 Act.
(e) Neither the Company nor any of its subsidiaries will,
prior to the earlier of the Second Closing Date or termination or
expiration of the related option, incur any liability or obligation,
direct or contingent, or enter into any material transaction, other
than in the ordinary course of business, except as contemplated by the
Prospectus.
(f) Neither the Company nor any of its subsidiaries will
acquire any capital stock of the Company prior to the earlier of the
Second Closing Date or termination or expiration of the related option
nor will the Company declare or pay any dividend or make any other
distribution upon the Common Stock payable to stockholders of record
on a date prior to the earlier of the Second Closing Date or
termination or expiration of the related option, except in either case
as contemplated by the Prospectus.
(g) Not later than ______________, 1997 the Company will make
generally available to its security holders an earnings statement
(which need not be audited) covering a period of at least 12 months
beginning after the effective date of the Registration Statement,
which will satisfy the provisions of the last paragraph of Section
11(a) of the 1933 Act.
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(h) During such period as a prospectus is required by law to
be delivered in connection with offers and sales of the Shares by an
Underwriter or dealer, the Company will furnish to you at its expense,
subject to the provisions of subsection (d) hereof, copies of the
Registration Statement, the Prospectus, each preliminary prospectus
and all amendments and supplements to any such documents in each case
as soon as available and in such quantities as you may reasonably
request, for the purposes contemplated by the 1933 Act.
(i) The Company will cooperate with the Underwriters in
qualifying or registering the Shares for sale under the blue sky laws
of such jurisdictions as you designate, and will continue such
qualifications in effect so long as reasonably required for the
distribution of the Shares. The Company shall not be required to
qualify as a foreign corporation or to file a general consent to
service of process in any such jurisdiction where it is not currently
qualified or where it would be subject to taxation as a foreign
corporation.
(j) During the period of five years hereafter, the Company
will furnish you and each of the other Underwriters (upon their
request) with a copy (i) as soon as practicable after the filing
thereof, of each report filed by the Company with the Commission, any
securities exchange or the NASD; (ii) as soon as practicable after the
release thereof, of each material press release in respect of the
Company; and (iii) as soon as available, of each report of the Company
mailed to stockholders.
(k) The Company will use the net proceeds received by it from
the sale of the Shares being sold by it in the manner specified in the
Prospectus.
(l) If, at the time of effectiveness of the Registration
Statement, any information shall have been omitted therefrom in
reliance upon Rule 430A and/or Rule 434, then immediately following
the execution of the Pricing Agreement, the Company will prepare, and
file or transmit for filing with the Commission in accordance with
such Rule 430A, Rule 424(b) and/or Rule 434, copies of an amended
Prospectus, or, if required by such Rule 430A and/or Rule 434, a
post-effective amendment to the Registration Statement (including an
amended Prospectus), containing all information so omitted. If
required, the Company will prepare and file, or transmit for filing, a
Rule 462(b) Registration Statement not later than the date of the
execution of the Pricing Agreement. If a Rule 462(b) Registration
Statement is filed, the Company shall make payment of, or arrange for
payment of, the additional registration fee owing to the Commission
required by Rule 111.
(m) The Company will comply with all registration, filing and
reporting requirements of the Exchange Act and the Nasdaq National
Market and will file with the Commission in a timely manner all
reports on Form SR required by Rule 463 and
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will furnish you copies of any such reports as soon as practicable
after the filing thereof.
(n) Superior Consultant Company, Inc. has elected or will
elect pursuant to Section 1362(e)(3) of the Code and Treas. Reg.
Section 1.1362-3(b)(1) to allocate its S termination year income on
the basis of its normal accounting method to the S short year (within
the meaning of Section 1362(e)(1)(A)) ending on the close of business
on the date this Agreement is executed and to the C short year (within
the meaning of Section 1362(e)(1)(B)) commencing on the day after this
Agreement is executed.
Section 7. Payment of Expenses. Whether or not the transactions
contemplated hereunder are consummated or this Agreement becomes effective as
to all of its provisions or is terminated, the Company agrees to pay (i) all
costs, fees and expenses (other than legal fees and disbursements of counsel
for the Underwriters and the expenses incurred by the Underwriters) incurred in
connection with the performance of the Company's and the Selling Stockholders'
obligations hereunder, including without limiting the generality of the
foregoing, all fees and expenses of legal counsel for the Company and the
Selling Stockholders' and of the Company's independent accountants, all costs
and expenses incurred in connection with the preparation, printing, filing and
distribution of the Registration Statement, each preliminary prospectus and the
Prospectus (including all exhibits and financial statements) and all amendments
and supplements provided for herein, this Agreement, the Pricing Agreement and
the Blue Sky Memorandum, (ii) all costs, fees and expenses (including legal
fees not to exceed $10,000 and disbursements of counsel for the Underwriters)
incurred by the Underwriters in connection with qualifying or registering all
or any part of the Shares for offer and sale under blue sky laws, including the
preparation of a blue sky memorandum relating to the Shares, and all costs,
fees and expenses (including legal fees and disbursements of counsel for the
Underwriters) incurred by the Underwriters in connection with the clearance of
such offering with the NASD; and (iii) all fees and expenses of the Company's
transfer agent, printing of the certificates for the Shares and all transfer
taxes, if any, with respect to the sale and delivery of the Shares to the
several Underwriters.
The provisions of this Section shall not affect any agreement which
the Company and the Selling Stockholders may make for the allocation or sharing
of such expenses and costs.
Section 8. Conditions of the Obligations of the Underwriters. The
obligations of the several Underwriters to purchase and pay for the Firm Shares
on the First Closing Date and the Option Shares on the Second Closing Date
shall be subject to the accuracy of the representations and warranties on the
part of the Company and the Selling Stockholders herein set forth as of the
date hereof and as of the First Closing Date or the Second Closing Date, as the
case may be, to the accuracy of the statements of officers of the Company made
pursuant to the provisions hereof, to the performance by the Company and the
Selling Stockholders of their respective obligations hereunder, and to the
following additional conditions:
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(a) The Registration Statement shall have become effective
either prior to the execution of this Agreement or not later than 1:00
P.M., Chicago Time, on the first full business day after the date of
this Agreement, or such later time as shall have been consented to by
you but in no event later than 1:00 P.M., Chicago Time, on the third
full business day following the date hereof; and prior to the First
Closing Date or the Second Closing Date, as the case may be, no stop
order suspending the effectiveness of the Registration Statement shall
have been issued and no proceedings for that purpose shall have been
instituted or shall be pending or, to the knowledge of the Company,
the Selling Stockholders or you, shall be contemplated by the
Commission. If the Company has elected to rely upon Rule 430A and/or
Rule 434, the information concerning the initial public offering price
of the Shares and price-related information shall have been
transmitted to the Commission for filing pursuant to Rule 424(b)
within the prescribed period and the Company will provide evidence
satisfactory to the Representatives of such timely filing (or a
post-effective amendment providing such information shall have been
filed and declared effective in accordance with the requirements of
Rules 430A and 424(b)). If a Rule 462(b) Registration Statement is
required, such Registration Statement shall have been transmitted to
the Commission for filing and become effective within the prescribed
time period and, prior to the First Closing Date, the Company shall
have provided evidence of such filing and effectiveness in accordance
with Rule 462(b).
(b) The legality and sufficiency of the authorization,
issuance and sale or transfer and sale of the Shares hereunder, the
validity and form of the certificates representing the Shares, the
execution and delivery of this Agreement and the Pricing Agreement,
and all corporate proceedings and other legal matters incident
thereto, and the form of the Registration Statement and the Prospectus
(except financial statements) shall have been approved by counsel for
the Underwriters exercising reasonable judgment.
(c) You shall not have advised the Company that the
Registration Statement or the Prospectus or any amendment or
supplement thereto, contains an untrue statement of fact, which, in
the opinion of counsel for the 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 necessary to make the statements
therein not misleading.
(d) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred any change, or any
development involving a prospective change, in or affecting
particularly the business or properties of the Company or its
subsidiaries taken as a whole, whether or not arising in the ordinary
course of business, which, in the judgment of the Representatives,
makes it impractical or inadvisable to proceed with the public
offering or purchase of the Shares as contemplated hereby.
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(e) The Corporate Reorganization (as contemplated by the
Prospectus) shall have been duly and validly completed.
(f) Messrs. Helppie, Tashiro and Xxxxxxx shall have executed
the agreements limiting their compensation which are described in the
Prospectus and such agreements shall be in full force and effect.
(g) There shall have been furnished to you, as
Representatives of the Underwriters, on the First Closing Date or the
Second Closing Date, as the case may be, except as otherwise expressly
provided below:
(i) An opinion of Xxxxxxxx & Xxxxxx, Ltd., counsel
for the Company and for the Selling Stockholders, addressed to
the Underwriters and dated the First Closing Date or the
Second Closing Date, as the case may be, to the effect that:
(1) the Company has been duly incorporated
and is validly existing as a corporation in good
standing under the laws of the State of Delaware with
corporate power and authority to own its properties
and conduct its business as described in the
Prospectus; and, to their knowledge, the Company has
been duly qualified to do business as a foreign
corporation under the corporation law of, and is in
good standing as such in, every jurisdiction where
the ownership or leasing of property, or the conduct
of its business requires such qualification except
where the failure so to qualify would not have a
material adverse effect upon the condition (financial
or otherwise) or results of operations of the Company
and its subsidiaries taken as a whole;
(2) an opinion to the same general effect as
clause (1) of this subparagraph (i) with respect to
each subsidiary of the Company;
(3) all of the issued and outstanding
capital stock of each subsidiary of the Company has
been duly authorized, validly issued and is fully
paid and nonassessable, and the Company owns directly
or indirectly 100 percent of the outstanding capital
stock of each subsidiary, and to the best knowledge
of such counsel, such stock is owned free and clear
of any claims, liens, encumbrances or security
interests and there are no outstanding rights,
preemptive rights, subscriptions, warrants, calls,
options, rights of first refusal or other agreements
of any kind with respect to the capital stock of
either subsidiary of the Company;
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(4) the authorized capital stock of the
Company, of which there is outstanding the amount set
forth in the Registration Statement and Prospectus
(except for subsequent issuances, if any, pursuant to
stock options or other rights referred to in the
Prospectus), conforms as to legal matters in all
material respects to the description thereof in the
Registration Statement and Prospectus;
(5) the issued and outstanding capital stock
of the Company has been duly authorized and validly
issued and is fully paid and nonassessable and was
not issued in violation of any preemptive or similar
rights arising by operation of law, under the charter
or by-laws of the Company or, to the knowledge of
such counsel, under any agreement to which the
Company or any of its subsidiaries is a party;
(6) the certificates for the Shares to be
delivered hereunder are in due and proper form, and
when duly countersigned by the Company's transfer
agent and delivered to you or upon your order against
payment of the agreed consideration therefor in
accordance with the provisions of this Agreement and
the Pricing Agreement, the Shares represented thereby
will be duly authorized and validly issued, fully
paid and nonassessable and conform to the description
thereof in the Prospectus; the Shares to be sold
hereunder have been duly and validly authorized and
qualified for inclusion on the Nasdaq National
Market;
(7) the Registration Statement has become
effective under the 1933 Act, and, to the best
knowledge of such counsel, no stop order suspending
the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose have
been instituted or are pending or contemplated under
the 1933 Act, and the Registration Statement
(including the information deemed to be part of the
Registration Statement at the time of effectiveness
pursuant to Rule 430A(b) and/or Rule 434, if
applicable), the Prospectus and each amendment or
supplement thereto (except for the financial
statements and other statistical or financial data
included therein as to which such counsel need
express no opinion) comply as to form in all material
respects with the requirements of the 1933 Act; such
counsel have no reason to believe that either the
Registration Statement (including the information
deemed to be part of the Registration Statement at
the time of effectiveness pursuant to Rule 430A(b)
and/or Rule 434, if applicable) or the Prospectus, or
the Registration Statement or the Prospectus as
amended or supplemented (except as aforesaid), as of
their respective effective or issue dates, contained
any untrue statement of a
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material fact or omitted to state a material fact
required to be stated therein or necessary to make
the statements therein not misleading or that the
Prospectus as amended or supplemented, if applicable,
as of the First Closing Date or the Second Closing
Date, as the case may be, contained any untrue
statement of a material fact or omitted to state any
material fact necessary to make the statements
therein not misleading in light of the circumstances
under which they were made; the statements in the
Registration Statement and the Prospectus summarizing
statutes, rules and regulations are accurate and
fairly and correctly present the information required
to be presented by the 1933 Act or the rules and
regulations thereunder, in all material respects and
such counsel does not know of any statutes, rules and
regulations required to be described or referred to
in the Registration Statement or the Prospectus that
are not described or referred to therein as required;
and such counsel does not know of any legal or
governmental proceedings pending or threatened
required to be described in the Prospectus which are
not described as required, nor of any contracts or
documents of a character required to be described in
the Registration Statement or Prospectus or to be
filed as exhibits to the Registration Statement which
are not described or filed, as required;
(8) the statements under the captions
"Management - Employee Benefit Plans," "Management -
Employment Related Agreements," "S-Corporation
Termination," "Certain Transactions," "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 and fairly
and correctly present, in all material respects, the
information called for with respect to such documents
and matters;
(9) this Agreement and the Pricing Agreement
and the performance of the Company's obligations
hereunder have been duly authorized by all necessary
corporate action and this Agreement and the Pricing
Agreement have been duly executed and delivered by
and on behalf of the Company, and are legal, valid
and binding agreements of the Company, except as
enforceability of the same may be limited by
bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting creditors' rights and by
the exercise of judicial discretion in accordance
with general principles applicable to equitable and
similar remedies and except as to those provisions
relating to indemnities and contribution for
liabilities arising under the 1933 Act as to which no
opinion need be expressed; and no approval,
authorization or consent of
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any public board, agency, or instrumentality of the
United States or of any state or other jurisdiction
is necessary in connection with the issue or sale of
the Shares by the Company pursuant to this Agreement
(other than under the 1933 Act, applicable blue sky
laws and the rules of the NASD) or the consummation
by the Company of any other transactions contemplated
hereby;
(10) the execution and performance of this
Agreement will not contravene any of the provisions
of, or result in a default under, any agreement,
franchise, license, indenture, mortgage, deed of
trust, or other instrument known to such counsel, of
the Company or any of its subsidiaries or by which
the property of any of them is bound and which
contravention or default would be material to the
Company and its subsidiaries taken as a whole; or
violate any of the provisions of the charter or
bylaws of the Company or any of its subsidiaries or,
so far as is known to such counsel, violate any
statute, order, rule or regulation of any regulatory
or governmental body having jurisdiction over the
Company or any of its subsidiaries;
(11) to such counsel's knowledge, all offers
and sales of the Company's and the operating
companies' capital stock prior to the date hereof
were at all relevant times exempt from the
registration requirements of the 1933 Act and were
duly registered or the subject of an available
exemption from the registration requirements of the
applicable state securities or blue sky laws;
(12) with respect to each Selling
Stockholder, this Agreement, the Pricing Agreement,
the Power of Attorney and Custody Agreement have been
duly authorized, executed and delivered by or on
behalf of each such Selling Stockholder; the Agents
and the Custodian for each such Selling Stockholder
have been duly and validly authorized to carry out
all transactions contemplated herein on behalf of
each such Selling Stockholder; and the performance of
this Agreement, the Pricing Agreement, the Power of
Attorney and the Custody Agreement and the
consummation of the transactions herein and therein
contemplated by such Selling Stockholders will not
result in a breach or violation of any of the terms
and provisions of, or constitute a default under, any
statute, any indenture, mortgage, deed of trust, note
agreement or other agreement or instrument known to
such counsel to which any of such Selling
Stockholders is a party or by which any are bound or
to which any of the property of such Selling
Stockholders is subject, or any order, rule or
regulation known to such counsel of any court or
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governmental agency or body having jurisdiction over
any of such Selling Stockholders or any of their
properties; and no consent, approval, authorization
or order of any court or governmental agency or body
is required for the consummation of the transactions
contemplated by this Agreement, the Pricing
Agreement, the Power of Attorney and the Custody
Agreement in connection with the sale of Shares to be
sold by such Selling Stockholders hereunder, except
such as have been obtained under the 1933 Act and
such as may be required under applicable blue sky
laws in connection with the purchase and distribution
of such Shares by the Underwriters and the clearance
of such offering with the NASD;
(13) each Selling Stockholder has full
right, power and authority to enter into this
Agreement, the Pricing Agreement, the Power of
Attorney and the Custody Agreement and to sell,
transfer and deliver the Shares to be sold on the
First Closing Date or the Second Closing Date, as the
case may be, by such Selling Stockholder hereunder
and good and marketable title to such Shares so sold,
free and clear of all voting trust arrangements,
liens, encumbrances, equities, claims and community
property rights whatsoever, has been transferred to
the Underwriters (who counsel may assume to be bona
fide purchasers) who have purchased such Shares
hereunder;
(14) this Agreement, the Pricing Agreement,
the Power of Attorney and the Custody Agreement are
legal, valid and binding agreements of each Selling
Stockholder except as enforceability of the same may
be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors'
rights and by the exercise of judicial discretion in
accordance with general principles applicable to
equitable and similar remedies and except with
respect to those provisions relating to indemnities
and contribution for liabilities arising under the
1933 Act, as to which no opinion need be expressed;
(15) the Company is not an "investment
company" or a person "controlled by" an "investment
company" within the meaning of the Investment Company
Act;
(16) to the knowledge of such counsel except
as disclosed in the Prospectus, no person has the
right, contractual or otherwise, to cause the Company
to issue, or register pursuant to the 1933 Act, any
shares of capital stock of the Company, upon the
issue and sale of the Shares to be sold by the
Company to the Underwriters pursuant to this
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Agreement, nor does any person have preemptive
rights, rights of first refusal, or other rights to
purchase any capital stock of the Company;
(17) each of the Company and the
operating companies had the requisite corporate power
and authority to carry out the Corporate
Reorganization, and each of the Company and the
operating companies and the stockholders of each of
them have taken all action required by law, their
respective charter and bylaws or otherwise to approve
the Corporate Reorganization, as the case may be; and
(18) the consummation of the Corporate
Reorganization did not contravene any provision of
applicable law or the respective charter or bylaws of
the Company or any of the operating companies or,
except to the extent the Company has obtained the
requisite consent, any provision of any material
agreement or other material instrument binding upon
the Company or any of the operating companies or any
order, writ, injunction or decree of any
jurisdiction, court or governmental body, and no
consent, approval, authorization or order of any
court or governmental agency or body is or was
required in connection with the Corporate
Reorganization, except such as have been obtained.
In rendering such opinion, such counsel may
state that insofar as their opinion under clause (7) above
relates to the accuracy and completeness of the Prospectus and
Registration Statement, it is based upon a general review with
the Company's representatives and independent accountants of
the information contained therein, without independent
verification by such counsel of the accuracy or completeness
of such information. Such counsel may also rely upon the
opinions of other competent counsel and, as to factual
matters, on certificates of the Selling Stockholders and of
officers of the Company and of state officials, in which case
their opinion is to state that they are so doing and copies of
said opinions or certificates are to be attached to the
opinion unless said opinions or certificates (or, in the case
of certificates, the information therein) have been furnished
to the Representatives in other form.
(ii) Such opinion or opinions of XxXxxxxxx, Will &
Xxxxx, counsel for the Underwriters, dated the First Closing
Date or the Second Closing Date, as the case may be, with
respect to the incorporation of the Company, the validity of
the Shares to be sold by the Company, the Registration
Statement and the Prospectus and other related matters as you
may reasonably require, and the Company shall have furnished
to such counsel such documents and
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shall have exhibited to them such papers and records as they
request for the purpose of enabling them to pass upon such
matters.
(iii) A certificate of the chief executive officer
and the principal financial officer of the Company, dated the
First Closing Date or the Second Closing Date, as the case may
be, to the effect that:
(1) the representations and warranties of
the Company set forth in Section 2 of this Agreement
are true and correct as of the date of this Agreement
and as of the First Closing Date or the Second
Closing Date, as the case may be, and the Company has
complied with all the agreements and satisfied all
the conditions on its part to be performed or
satisfied at or prior to such Closing Date; and
(2) the Commission has not issued an order
preventing or suspending the use of the Prospectus or
any preliminary prospectus filed as a part of the
Registration Statement or any amendment thereto; no
stop order suspending the effectiveness of the
Registration Statement has been issued; and to the
best knowledge of the respective signers, no
proceedings for that purpose have been instituted or
are pending or contemplated under the 1933 Act.
The delivery of the certificate provided for
in this subparagraph shall be and constitute a representation
and warranty of the Company as to the facts required in the
immediately foregoing clauses (1) and (2) of this subparagraph
to be set forth in said certificate.
(iv) A certificate of each Selling Stockholder dated
the First Closing Date or the Second Closing Date, as the case
may be, to the effect that the representations and warranties
of such Selling Stockholder set forth in Section 3 of this
Agreement are true and correct as of such date and the Selling
Stockholder has complied with all the agreements and satisfied
all the conditions on the part of such Selling Stockholder to
be performed or satisfied at or prior to such date.
(v) At the time the Pricing Agreement is executed
and also on the First Closing Date or the Second Closing Date,
as the case may be, there shall be delivered to you a letter
addressed to you, as Representatives of the Underwriters, from
Xxxxx Xxxxxxxx L.L.C., independent accountants, the first one
to be dated the date of the Pricing Agreement, the second one
to be dated the First Closing Date and the third one (in the
event of a second closing) to be dated the Second Closing
Date, to the effect set forth in Schedule C. There
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shall not have been any change or decrease specified in the
letters referred to in this subparagraph which makes it
impractical or inadvisable in the judgment of the
Representatives to proceed with the public offering or
purchase of the Shares as contemplated hereby.
(vi) Such further certificates and documents as you
may reasonably request.
All such opinions, certificates, letters and documents shall be in
compliance with the provisions hereof only if they are satisfactory to you and
to XxXxxxxxx, Will & Xxxxx, counsel for the Underwriters, which approval shall
not be unreasonably withheld. The Company shall furnish you with such manually
signed or conformed copies of such opinions, certificates, letters and
documents as you request.
If any condition to the Underwriters' obligations hereunder to be
satisfied prior to or at the First Closing Date is not so satisfied, this
Agreement at your election will terminate upon notification to the Company and
the Selling Stockholders without liability on the part of any Underwriter or
the Company or any Selling Stockholder, except for the expenses to be paid or
reimbursed by the Company pursuant to Sections 7 and 9 hereof and except to the
extent provided in Section 11 hereof.
Section 9. Reimbursement of Underwriters' Expenses. If the sale to
the Underwriters of the Shares on the First Closing Date is not consummated
because any condition of the Underwriters' obligations hereunder is not
satisfied or because of any refusal, inability or failure on the part of the
Company or the Selling Stockholders to perform any agreement herein or to
comply with any provision hereof, unless such failure to satisfy such condition
or to comply with any provision hereof is due to the default or omission of any
Underwriter, the Company agrees to reimburse you and the other Underwriters
upon demand for all out-of-pocket expenses (including reasonable fees and
disbursements of counsel) that shall have been reasonably incurred by you and
them in connection with the proposed purchase and the sale of the Shares. Any
such termination shall be without liability of any party to any other party
except that the provisions of this Section, Section 7 and Section 11 shall at
all times be effective and shall apply.
Section 10. Effectiveness of Registration Statement. You, the
Company and the Selling Stockholders will use your, its and their best efforts
to cause the Registration Statement to become effective, if it has not yet
become effective, and to prevent the issuance of any stop order suspending the
effectiveness of the Registration Statement and, if such stop order be issued,
to obtain as soon as possible the lifting thereof.
Section 11. Indemnification. (a) The Company and each Selling
Stockholder, jointly and severally, agree to indemnify and hold harmless each
Underwriter and each person, if
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any, who controls any Underwriter within the meaning of the 1933 Act or the
Exchange Act against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter or such controlling person may become
subject under the 1933 Act, the Exchange Act or other federal or state
statutory law or regulation, at common law or otherwise (including in
settlement of any litigation if such settlement is effected with the written
consent of the Company and/or such Selling Stockholders, as the case may be),
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement,
including the information deemed to be part of the Registration Statement at
the time of effectiveness pursuant to Rule 430A and/or Rule 434, if applicable,
any preliminary prospectus, the Prospectus, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading; and will reimburse each Underwriter
and each such controlling person for any legal or other expenses reasonably
incurred by such Underwriter or such controlling person in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that neither the Company nor any Selling Stockholder will be
liable in any such case to the extent that (i) any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in the Registration Statement,
any preliminary prospectus, the Prospectus or any amendment or supplement
thereto in reliance upon and in conformity with written information furnished
to the Company by or on behalf of any Underwriter through the Representatives,
specifically for use therein; or (ii) if such statement or omission was
contained or made in any preliminary prospectus and corrected in the Prospectus
and (1) any such loss, claim, damage or liability suffered or incurred by any
Underwriter (or any person who controls any Underwriter) resulted from an
action, claim or suit by any person who purchased Shares which are the subject
thereof from such Underwriter in the offering and (2) such Underwriter failed
to deliver or provide a copy of the Prospectus to such person at or prior to
the confirmation of the sale of such Shares in any case where such delivery is
required by the 1933 Act. In addition to their other obligations under this
Section 11(a), the Company and the Selling Stockholders agree that, as an
interim measure during the pendency of any claim, action, investigation,
inquiry or other proceeding arising out of or based upon any statement or
omission, or any alleged statement or omission, described in this Section
11(a), they will reimburse the Underwriters on a monthly basis for all
reasonable legal and other expenses incurred in connection with investigating
or defending any such claim, action, investigation, inquiry or other
proceeding, notwithstanding the absence of a judicial determination as to the
propriety and enforceability of the Company's and the Selling Stockholders'
obligation to reimburse the Underwriters for such expenses and the possibility
that such payments might later be held to have been improper by a court of
competent jurisdiction. This indemnity agreement will be in addition to any
liability which the Company and the Selling Stockholders may otherwise have.
-27-
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Without limiting the full extent of the Company's agreement to
indemnify each Underwriter, as herein provided,
(i) each Selling Stockholder other than Messrs. Helppie, Tashiro and
Xxxxxxx shall be liable under the indemnity agreements contained in paragraph
(a) of this Section only for losses, claims, damages or liabilities arising out
of or based upon untrue or alleged untrue statements or omissions or alleged
omissions made in the Registration Statement, any preliminary prospectus, the
prospectus, or any amendment or supplement thereto that relate to such Selling
Stockholder,
(ii) each Selling Stockholder other than Messrs. Helppie, Tashiro and
Xxxxxxx shall be liable under the indemnity agreements contained in paragraph
(a) of this Section and for breaches of any representations and warranties
contained in this Agreement only for an amount not exceeding the proceeds
received by such Selling Stockholder from the sale of Shares hereunder, and
(iii) Messrs. Helppie, Tashiro and Xxxxxxx, shall each be liable under
the indemnity agreements contained in paragraph (a) of this Section and for
breaches of any representations and warranties contained in this Agreement for
an amount not exceeding the sum of (I) the proceeds received by such Selling
Stockholder from the sale of Shares hereunder, plus (II) the portion of the
proceeds of the Offering used to pay accrued compensation to such Selling
Stockholder or used to repay indebtedness of the Company which was incurred to
pay accrued compensation to such Selling Stockholder.
(b) Each Underwriter will severally indemnify and hold harmless the
Company, each of its directors, each of its officers who signed the
Registration Statement, and each Selling Stockholder and each person, if any,
who controls the Company within the meaning of the 1933 Act or the Exchange
Act, against any losses, claims, damages or liabilities to which the Company,
or any such director, officer, Selling Stockholder or controlling person may
become subject under the 1933 Act, the Exchange Act or other federal or state
statutory law or regulation, at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of such Underwriter), insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue or alleged untrue statement of any material fact contained in the
Registration Statement, any preliminary prospectus, the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each
case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in the
Registration Statement, any preliminary prospectus, the Prospectus, or any
amendment or supplement thereto in reliance upon and in conformity with Section
4 of this Agreement or any other written information furnished to the Company
by such Underwriter through the
-28-
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Representatives specifically for use in the preparation thereof; and will
reimburse any legal or other expenses reasonably incurred by the Company, or
any such director, officer, Selling Stockholder or controlling person in
connection with investigating or defending any such loss, claim, damage,
liability or action. In addition to their other obligations under this Section
11(b), the Underwriters agree that, as an interim measure during the pendency
of any claim, action, investigation, inquiry or other proceeding arising out of
or based upon any statement or omission, or any alleged statement or omission,
described in this Section 11(b), they will reimburse the Company and the
Selling Stockholders on a monthly basis for all reasonable legal and other
expenses incurred in connection with investigating or defending any such claim,
action, investigation, inquiry or other proceeding, notwithstanding the absence
of a judicial determination as to the propriety and enforceability of the
Underwriters' obligation to reimburse the Company and the Selling Stockholders
for such expenses and the possibility that such payments might later be held to
have been improper by a court of competent jurisdiction. This indemnity
agreement will be in addition to any liability which such Underwriter may
otherwise have.
(c) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against an indemnifying party under this
Section, notify the indemnifying party of the commencement thereof; but the
omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party except to the extent that
the indemnifying party was prejudiced by such failure to notify. In case any
such action is brought against any indemnified party, and it notifies an
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate in, and, to the extent that it may wish, jointly with
all other indemnifying parties similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party; provided,
however, if the defendants in any such action include both the indemnified
party and the indemnifying party and the indemnified party shall have
reasonably concluded that there may be legal defenses available to it and/or
other indemnified parties which are different from or additional to those
available to the indemnifying party, or the indemnified and indemnifying
parties may have conflicting interests which would make it inappropriate for
the same counsel to represent both of them, the indemnified party or parties
shall have the right to select separate counsel to assume such legal defense
and otherwise to participate in the defense of such action on behalf of such
indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of its election so to assume the defense of
such action and approval by the indemnified party of counsel, the indemnifying
party will not be liable to such indemnified party under this Section for any
legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof unless (i) the indemnified party shall have
employed such counsel in connection with the assumption of legal defense in
accordance with the proviso to the next preceding sentence (it being
understood, however, that the indemnifying party shall not be liable for the
expenses of more than one separate counsel, approved by the Representatives in
the case of paragraph (a),
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representing all indemnified parties not having different or additional
defenses or potential conflicting interest among themselves who are parties to
such action), (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability arising out
of such proceeding.
(d) If the indemnification provided for in this Section is
unavailable to an indemnified party under paragraphs (a) or (b) hereof in
respect of any losses, claims, damages or liabilities referred to therein, then
each applicable indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company, the Selling Stockholders and the Underwriters from the offering of the
Shares or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault
of the Company, the Selling Stockholders and the Underwriters in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities, as well as any other relevant equitable considerations. The
respective relative benefits received by the Company, the Selling Stockholders
and the Underwriters shall be deemed to be in the same proportion in the case
of the Company and the Selling Stockholders, as the total price paid to the
Company and the Selling Stockholders for the Shares by the Underwriters (net of
underwriting discount but before deducting expenses), and in the case of the
Underwriters as the underwriting discount received by them bears to the total
of such amounts paid to the Company and the Selling Stockholders and received
by the Underwriters as underwriting discount in each case as contemplated by
the Prospectus. The relative fault of the Company and the Selling Stockholders
and the Underwriters shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
Company or by the Selling Stockholders or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The amount paid or payable by a party as a
result of the losses, claims, damages and liabilities referred to above shall
be deemed to include any legal or other fees or expenses reasonably incurred by
such party in connection with investigating or defending any action or claim.
The Company, the Selling Stockholders and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this Section
were determined by pro rata
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allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section, no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Shares underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 0000
Xxx) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Underwriters' obligations to contribute
pursuant to this Section are several in proportion to their respective
underwriting commitments and not joint.
(e) The provisions of this Section shall survive any termination of
this Agreement.
Section 12. Default of Underwriters. It shall be a condition to the
agreement and obligation of the Company and the Selling Stockholders to sell
and deliver the Shares hereunder, and of each Underwriter to purchase the
Shares hereunder, that, except as hereinafter in this paragraph provided, each
of the Underwriters shall purchase and pay for all Shares agreed to be
purchased by such Underwriter hereunder upon tender to the Representatives of
all such Shares in accordance with the terms hereof. If any Underwriter or
Underwriters default in their obligations to purchase Shares hereunder on the
First Closing Date and the aggregate number of Shares which such defaulting
Underwriter or Underwriters agreed but failed to purchase does not exceed 10
percent of the total number of Shares which the Underwriters are obligated to
purchase on the First Closing Date, the Representatives may make arrangements
satisfactory to the Company and the Selling Stockholders for the purchase of
such Shares by other persons, including any of the Underwriters, but if no such
arrangements are made by such date the nondefaulting Underwriters shall be
obligated severally, in proportion to their respective commitments hereunder,
to purchase the Shares which such defaulting Underwriters agreed but failed to
purchase on such date. If any Underwriter or Underwriters so default and the
aggregate number of Shares with respect to which such default or defaults occur
is more than the above percentage and arrangements satisfactory to the
Representatives and the Company and the Selling Stockholders for the purchase
of such Shares by other persons are not made within 36 hours after such
default, this Agreement will terminate without liability on the part of any
nondefaulting Underwriter or the Company or the Selling Stockholders, except
for the expenses to be paid by the Company pursuant to Section 7 hereof and
except to the extent provided in Section 11 hereof.
In the event that Shares to which a default relates are to be
purchased by the nondefaulting Underwriters or by another party or parties, the
Representatives or the Company shall have the right to postpone the First
Closing Date for not more than seven business days in order that the necessary
changes in the Registration Statement, Prospectus and any other documents, as
well as any other arrangements, may be effected. As used in this Agreement,
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the term "Underwriter" includes any person substituted for an Underwriter under
this Section. Nothing herein will relieve a defaulting Underwriter from
liability for its default.
Section 13. Effective Date. This Agreement shall become effective
immediately as to Sections 7, 9, 11 and 14 and as to all other provisions at
10:00 A.M., Chicago Time, on the day following the date upon which the Pricing
Agreement is executed and delivered, unless such a day is a Saturday, Sunday or
holiday (and in that event this Agreement shall become effective at such hour
on the business day next succeeding such Saturday, Sunday or holiday); but this
Agreement shall nevertheless become effective at such earlier time after the
Pricing Agreement is executed and delivered as you may determine on and by
notice to the Company and the Selling Stockholders or by release of any Shares
for sale to the public. For the purposes of this Section, the Shares shall be
deemed to have been so released upon the release for publication of any
newspaper advertisement relating to the Shares or upon the release by you of
telegrams (i) advising Underwriters that the Shares are released for public
offering, or (ii) offering the Shares for sale to securities dealers, whichever
may occur first.
Section 14. Termination. Without limiting the right to terminate
this Agreement pursuant to any other provision hereof:
(a) This Agreement may be terminated by the Company by notice
to you and the Selling Stockholders or by you by notice to the Company
and the Selling Stockholders at any time prior to the time this
Agreement shall become effective as to all its provisions, and any
such termination shall be without liability on the part of the Company
or the Selling Stockholders to any Underwriter (except for the
expenses to be paid or reimbursed pursuant to Section 7 hereof and
except to the extent provided in Section 11 hereof) or of any
Underwriter to the Company or the Selling Stockholders.
(b) This Agreement may also be terminated by you prior to the
First Closing Date, and the option referred to in Section 5, if
exercised, may be cancelled at any time prior to the Second Closing
Date, if (i) trading in securities on the New York Stock Exchange or
the Nasdaq National Market shall have been suspended or minimum prices
shall have been established on such exchange, or (ii) a banking
moratorium shall have been declared by Illinois, New York, or United
States authorities, or (iii) there shall have been any change in
financial markets or in political, economic or financial conditions
which, in the opinion of the Representatives, either renders it
impracticable or inadvisable to proceed with the offering and sale of
the Shares on the terms set forth in the Prospectus or materially and
adversely affects the market for the Shares, or (iv) there shall have
been an outbreak of major armed hostilities between the United States
and any foreign power which in the opinion of the Representatives
makes it impractical or inadvisable to offer or sell the Shares. Any
termination pursuant to this paragraph (b) shall be without liability
on the part of
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any Underwriter to the Company or the Selling Stockholders or on the
part of the Company to any Underwriter or the Selling Stockholders
(except for expenses to be paid or reimbursed pursuant to Section 7
hereof and except to the extent provided in Section 11 hereof).
Section 15. Representations and Indemnities to Survive Delivery. The
respective indemnities, agreements, representations, warranties and other
statements of the Company, of its officers, of the Selling Stockholders and of
the several Underwriters set forth in or made pursuant to this Agreement will
remain in full force and effect, regardless of any investigation made by or on
behalf of any Underwriter or the Company or any of its or their partners,
principals, members, officers or directors or any controlling person, or the
Selling Stockholders as the case may be, and will survive delivery of and
payment for the Shares sold hereunder.
Section 16. Notices. All communications hereunder will be in writing
and, if sent to the Underwriters will be mailed, delivered or telegraphed and
confirmed to you c/o Xxxxxxx Xxxxx & Company, L.L.C., 000 Xxxx Xxxxx Xxxxxx,
Xxxxxxx, Xxxxxxxx 00000, with a copy to Xxxxx X. Gierke, McDermott, Will &
Xxxxx, 000 Xxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000; if sent to the Company will be
mailed, delivered or telegraphed and confirmed to the Company at its corporate
headquarters with a copy to Xxxxxxx Xxxxxx, Xxxxxxxx & Xxxxxx Ltd., 00 X.
Xxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000; and if sent to the Selling Stockholders
will be mailed, delivered or telegraphed and confirmed to the Agents and the
Custodian at such address as they have previously furnished to the Company and
the Representatives, with a copy to ________________________________.
Section 17. Successors. This Agreement and the Pricing Agreement
will inure to the benefit of and be binding upon the parties hereto and their
respective successors, personal representatives and assigns, and to the benefit
of the officers and directors and controlling persons referred to in Section
11, and no other person will have any right or obligation hereunder. The term
"successors" shall not include any purchaser of the Shares as such from any of
the Underwriters merely by reason of such purchase.
Section 18. Representation of Underwriters. You will act as
Representatives for the several Underwriters in connection with this financing,
and any action under or in respect of this Agreement taken by you will be
binding upon all the Underwriters.
Section 19. Partial Unenforceability. If any section, paragraph or
provision of this Agreement is for any reason determined to be invalid or
unenforceable, such determination shall not affect the validity or
enforceability of any other section, paragraph or provision hereof.
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Section 20. Applicable Law. This Agreement and the Pricing Agreement
shall be governed by and construed in accordance with the laws of the State of
Illinois.
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company, the Selling
Stockholders and the several Underwriters including you, all in accordance with
its terms.
Very truly yours,
SUPERIOR CONSULTANT HOLDINGS
CORPORATION
By
________________________________________
Chief Executive Officer
[Selling Stockholders]
By
________________________________________
Agent and Attorney-in-Fact
The foregoing Agreement is hereby
confirmed and accepted as of
the date first above written.
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
Xxxxxxxxx & Company, Inc.
Acting as Representatives of the
several Underwriters named in
Schedule A.
Xxxxxxx Xxxxx & Company, L.L.C.
By__________________________________
Principal
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SCHEDULE A
Number of
Firm Shares
Underwriter to be Purchased
----------- ---------------
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
Xxxxxxxxx & Company, Inc.
------------------------
TOTAL 2,150,000
========================
36
SCHEDULE B
Number of Number of
Firm Shares Option Shares
to be Sold to be Sold
---------- ----------
Company 2,150,000 164,658
Selling Stockholders:
The Xxxxxxx X. Xxxxxxx, Xx. Trust 0 75,000
Xxxxxxx X. Xxxxxxx 0 50,000
Xxxxxx X. Xxxxxxx 0 25,000
Xxxxxxxx X. Xxxxxx 0 6,465
Xxxx X. Xxxxxx 0 1,377
------------------------ ------------------------
TOTAL 2,150,000 322,500
======================== ========================
37
SCHEDULE C
Comfort Letter of Xxxxx Xxxxxxxx LLC
(1) They are independent public accountants with respect to the
Company and its subsidiaries within the meaning of the 1933 Act.
(2) In their opinion the consolidated financial statements and
schedules of the Company and its subsidiaries included in the Registration
Statement and the consolidated financial statements of the Company from which
the information presented under the captions "Selected Consolidated Financial
and Operating Data" and "Selected Financial and Operating Data" has been
derived which are stated therein to have been examined by them comply as to
form in all material respects with the applicable accounting requirements of
the 1933 Act.
(3) On the basis of specified procedures (but not an examination in
accordance with generally accepted auditing standards), including inquiries of
certain officers of the Company and its subsidiaries responsible for financial
and accounting matters as to transactions and events subsequent to
___________________, 19___, a reading of minutes of meetings of the
stockholders and directors of the Company and its subsidiaries since
_________________, 19___, a reading of the latest available interim unaudited
consolidated financial statements of the Company and its subsidiaries (with an
indication of the date thereof) and other procedures as specified in such
letter, nothing came to their attention which caused them to believe that (i)
the unaudited consolidated financial statements of the Company and its
subsidiaries included in the Registration Statement do not comply as to form in
all material respects with the applicable accounting requirements of the 1933
Act or that such unaudited financial statements are not fairly presented in
accordance with generally accepted accounting principles applied on a basis
substantially consistent with that of the audited financial statements included
in the Registration Statement, and (ii) at a specified date not more than five
days prior to the date thereof in the case of the first letter and not more
than two business days prior to the date thereof in the case of the second and
third letters, there was any change in the capital stock or long-term debt or
short-term debt (other than normal payments) of the Company and its
subsidiaries on a consolidated basis or any decrease in consolidated net
current assets or consolidated stockholders' equity as compared with amounts
shown on the latest unaudited balance sheet of the Company included in the
Registration Statement or for the period from the date of such balance sheet to
a date not more than five days prior to the date thereof in the case of the
first letter and not more than two business days prior to the date thereof in
the case of the second and third letters, there were any decreases, as compared
with the corresponding period of the prior year, in consolidated net sales,
consolidated income before income taxes or in the total or per share amounts of
consolidated net income except, in all instances, for changes or decreases
which the Prospectus discloses have occurred or may occur or which are set
forth in such letter.
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(4) On the basis of reading the unaudited pro forma financial
statement data included in the Registration Statement and the Prospectus,
carrying out specified procedures, inquiries of certain officials of the
Company who have responsibility for financial and accounting matters, and
proving the arithmetic accuracy of the application of the pro forma adjustments
to the historical amounts in the pro forma financial statement data, nothing
came to their attention which caused them to believe that the pro forma
financial statement data does not comply in form in all material respects with
the applicable accounting requirements of Rule 11-02 of Regulation S-X of or
that the pro forma adjustments have not been properly applied to the historical
amounts in the compilation of such statements.
(5) They have carried out specified procedures, which have been
agreed to by the Representatives, with respect to certain information in the
Prospectus specified by the Representatives (including the unaudited annual
financial statements contained in the Prospectus), and on the basis of such
procedures, they have found such information to be in agreement with the
general accounting records of the Company and its subsidiaries.
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39
Exhibit A
SUPERIOR CONSULTANT HOLDINGS CORPORATION
2,150,000 Shares Common Stock(2)
PRICING AGREEMENT
October __, 1996
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
Xxxxxxxxx & Company, Inc.
As Representatives of the Several
Underwriters
c/o Xxxxxxx Xxxxx & Company, L.L.C.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
Reference is made to the Underwriting Agreement dated October __, 1996
(the "Underwriting Agreement") relating to the sale by the Company and the
Selling Stockholders and the purchase by the several Underwriters for whom
Xxxxxxx Xxxxx & Company, L.L.C., Xxxxxxxxx, Lufkin & Xxxxxxxx Securities
Corporation and Xxxxxxxxx & Company, Inc. are acting as representatives (the
"Representatives"), of the above Shares. All terms herein shall have the
definitions contained in the Underwriting Agreement except as otherwise defined
herein.
Pursuant to Section 5 of the Underwriting Agreement, the Company and
each of the Selling Stockholders agree with the Representatives as follows:
1. The initial public offering price per share for the Shares shall
be $__________.
2. The purchase price per share for the Shares to be paid by the
several Underwriters shall be $_____________, being an amount equal to the
initial public offering price set forth above less $____________ per share.
Schedule A is amended as follows:
____________________
(2)Plus an option to acquire up to 322,500 additional shares to cover
overallotments
A-1
40
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company, the Selling
Stockholders and the several Underwriters, including you, all in accordance
with its terms.
Very truly yours,
SUPERIOR CONSULTANT HOLDINGS
CORPORATION
By
________________________________________
Chief Executive Officer
[Selling Stockholders]
By
________________________________________
Agent and Attorney-in-Fact
The foregoing Agreement is hereby
confirmed and accepted as of
the date first above written.
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
Xxxxxxxxx & Company, Inc.
Acting as Representatives of the
several Underwriters named in
Schedule A.
Xxxxxxx Xxxxx & Company, L.L.C.
By__________________________________
Principal
A-2
