Exhibit 1(a)
800,000 UNITS
EUROWEB INTERNATIONAL CORP.
(EACH UNIT CONSISTING OF
ONE SHARE OF SERIES A CONVERTIBLE CUMULATIVE REDEEMABLE PREFERRED STOCK
AND ONE COMMON STOCK PURCHASE WARRANT)
AGREEMENT AMONG UNDERWRITERS
Dated: , 1998
X.X. Xxxxxxx & Co., Inc.
as Representative of the Several Underwriters
0 Xxxxxxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
We confirm our agreement with you as follows for the purchase by you and
the other several Underwriters hereinafter referred to, including ourselves, of
800,000 Units, each Unit consisting of one shares of Series A Convertible
Cumulative Redeemable Preferred Stock and one Common Stock Purchase Warrant,
(the "Units") plus the option to purchase up to an aggregate of 120,000
additional Units of Euroweb International Corp., a Delaware corporation, (the
"Company"). The Units are to be purchased from the Company pursuant to an
underwriting agreement, the form of which is annexed hereto (the "Underwriting
Agreement"), the number of Units to be purchased by us severally being
indicated on Schedule A to the Underwriting Agreement. The Units are to be
offered to the public, and such offering will be made under a registration
statement and prospectus relating thereto filed by the Company with the
Securities and Exchange Commission, under the Securities Act of 1933, as
amended (the "Act") copies of which, together with amendments thereto, we have
received. The registration statement in the form in which it becomes effective
and the prospectus, as then amended, are hereinafter respectively referred to
as the "Registration Statement" and the "Prospectus".
1. AUTHORITY OF MANAGING UNDERWRITER. We hereby authorize you, on our
behalf, and as our agent and representative (in that capacity sometimes herein
called the "Managing Underwriter" or "Representative"), to execute and deliver
the Underwriting Agreement substantially in the form attached hereto, to act in
our behalf in carrying it out and to take such action and make such
determinations as you may deem advisable under and with respect thereto,
including agreement to any non-material modification thereto (but not
modifications as to price and number of Units to be purchased by us).
2. PAYMENT AND DELIVERY. The purchase price of the Units to be purchased
by us shall be $5.40 per Unit, and on the Closing Date we will pay you the
amount so due plus an additional amount equal to $______ per Unit purchased by
us, as compensation for your services as Managing Underwriter.
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You shall give us at least 24 hours' notice of the Closing Date and the place
thereof pursuant to the Underwriting Agreement. We will deliver, at or before
9:00 A.M., New York City time, on the day fixed as such Closing Date, to you at
the office of the Representative, or at such other place or time as instructed
by you, certified or bank cashier's checks, payable to the order of the
Representative, in New York Clearing House funds, for the price of the Units
which we have agreed to purchase and for the aforesaid fee. Upon receipt of
such payment, you will make payment to the order of the Company, for our
account, of the purchase price of such Units against delivery thereof to you
for our account. You shall thereupon deliver to us the Units purchased by us,
less such amounts thereof as shall have been reserved for offering to Selected
Dealers if a selling group is formed. In the event we do not pay you the
purchase price in the amount and at the time stated above, you may either treat
our failure to do so as a default on our part or, at your election, pay the
purchase price to the Company on our behalf and charge us with the amount
thereof, with interest, withholding delivery of the Units for our account until
such purchase price and interest are received by you.
3. EXPENSES. You shall charge our account with: (i) all transfer taxes, if
any, and other charges on purchases, sales or transfers for our account; and
(ii) our proportionate share (based upon the number of Units we agree to
purchase) of all other expenses which are not paid by the Company, including,
but not limited to, advertising costs and legal fees and disbursements of
counsel for the Underwriters, incurred by you under the terms of this Agreement
or in connection with the purchase, carrying and sale of the Units, including
the expenses chargeable to and caused by any defaulting Underwriter hereunder.
Funds of the Underwriters in your hands, as Managing Underwriter, may be held
in your general funds without accountability for interest.
4. PUBLIC OFFERING. The initial public offering of the Units, which shall
be made as set forth in the Prospectus, may be made on the date on which the
Registration Statement becomes effective or as soon thereafter as in your
judgment shall be practicable. The initial public offering prices for the Units
shall be as shown on the cover page of the Prospectus. We authorize you to
determine the form of any advertisement of the Units and the form of
agreements, if any, with dealers. We also authorize you to manage any such
public offering and to act as manager under agreements with dealers.
We authorize you to reserve for sale, sell and deliver, on our behalf and
for our account, to dealers (who may include any Underwriter) selected by you
(herein sometimes referred to as the "Selected Dealers"), who are members of
the National Association of Securities Dealers, Inc. (the "NASD") or to foreign
banks, dealers and institutions not registered under the Securities Exchange
Act of 1934, as amended, (the "Exchange Act") which agree to make no sales
within the United States, its territories or possessions or to persons who are
citizens thereof or residents therein, and in making sales to comply with the
NASD's Interpretation With Respect to Free Riding and Withholding, and to such
persons other than dealers as you shall select, such number of Units purchased
by us from the Company as you shall determine. Such reservations and sales to
Selected Dealers and other persons for the respective accounts of the several
Underwriters shall be made as you may determine. The concessions to be allowed
to Selected Dealers and by them to be reallowed to others are specified in the
form of Selected Dealer Agreement annexed hereto. If no Selected Dealer
Agreement is entered into, we hereby authorize you to allow concessions not
exceeding $_____ per Unit (no part of which may be reallowed) to any other
dealer who is a member
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of the National Association of Securities Dealers, Inc. or is a foreign dealer.
The concessions and reallowances may be allowed only to dealers who are members
in good standing of said Association, or foreign banks, dealers or institutions
not eligible for membership in said Association who agree to make no sales
within the United States, its territories or possessions or to persons who are
citizens thereof or residents therein, and in making other sales, to comply
with said Associations' Interpretation With Respect to Free-Riding and
Withholding. Sales to others than such members or such foreign banks, dealers
or institutions will be made at the public offering prices.
You shall advise us promptly on the public offering date of the number of
Units purchased by us which you have not reserved for sale to dealers or other
persons. We will retain for direct sale all of such Units and, at any time
prior to the termination of this Agreement, you may reserve for sale to dealers
and other persons additional Units retained by us and remaining unsold.
We agree that whether or not any Selected Dealer Agreement with Selected
Dealers is entered into we shall be governed by the provisions of the attached
form of Selected Dealer Agreement (except as otherwise expressly provided
herein) during the term hereof, whether or not we are a Selected Dealer.
Upon our request you may from time to time, in your discretion, release to
us for direct sale any Units reserved by you for sale to Selected Dealers and
other persons on our behalf and not then sold, and any Units so released shall
not thereafter be deemed reserved.
If prior to, or within seven days after, the termination of this Agreement
any Units sold by us (other than Units sold by you as Managing Underwriter for
the account of an Underwriter pursuant to this Agreement or any Selected Dealer
Agreement) shall be purchased by the Managing Underwriter or by any Underwriter
through the Managing Underwriter in the open market, then any of such Units
shall be repurchased by us at a price equal to the total cost thereof including
commissions and transfer taxes, if any, on redelivery. The Units delivered on
such repurchase need not be the identical Units originally so purchased. In
lieu of the repurchase of such Units you may, at your option (a) charge us an
amount equal to the difference between the public offering prices and the cost
prices to Selected Dealers of the Units so purchased, and any broker's
commissions paid in connection with such purchase, or (b) sell for our account
the Units so purchased, publicly or privately without notice at such prices and
upon such terms and to such purchasers, including any of the several
Underwriters, as you may determine, charging us the amount of any loss and
expense or crediting to us the amount of any profit, less any expense,
resulting from such sale.
5. SALE OF UNITS BY UNDERWRITERS TO MANAGING UNDERWRITER. We will advise
you, from time to time upon request, of the number of Units retained by or
released to us for direct sale which then remain unsold and until the
termination of this Agreement we will, upon your request, sell to you, in order
to enable you to consummate sales or cover over-allotments, such number of such
unsold Units as you may specify, at such price as you may designate, but not
less than the purchase prices paid to the Company therefor.
6. TRANSACTIONS IN UNITS BY UNDERWRITERS. We agree that until termination
of this Agreement
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and the Selected Dealer Agreements, we will not buy or sell for our account any
of the Units or outstanding shares of Common Stock of the Company except as
permitted in this Agreement and the Selected Dealer Agreement or as a broker
pursuant to unsolicited orders, provided, however, that, subject to the
approval of the Managing Underwriter, any Underwriter may buy Units from, or
sell Units to, any other Underwriter at the public offering price, less all or
any part of a concession of $______ per Unit, and may buy from, and sell the
same to, any Selected Dealer at the public offering price less all or any part
of any concession to Selected Dealers in the amount specified in the form of
Selected Dealer Agreement.
7. LOANS AND ADVANCES. We authorize you to arrange such loans for our
account, or to make such advances of your funds on our behalf, as you may deem
necessary or advisable in connection with the purchase, delivery or carrying of
any of the Units (and as may be permitted by law), and to pledge or hold as
security therefor all or any part of the Units which we shall have purchased or
agreed to purchase from the Company. We shall be paid or credited with the
proceeds of all loans made for our account.
You may, and at our request will, deliver to us from time to time on or
after the Closing Date and prior to the termination of this Agreement, for
carrying purposes only, any Units purchased by us which have been reserved for
sale for our account but not sold and paid for. We will redeliver to you any
Units so delivered to us for carrying purposes at such time or times prior to
such termination as you may demand.
8. STABILIZATION. We authorize you, in your discretion, during the term of
this Agreement, and for our account (a) to buy and sell Units in the open
market or otherwise, for long or short account, in such amounts and on such
terms and at such prices as you may determine, provided that, during the term
of this Agreement and the Selected Dealer Agreement, any such sales of Units
shall be made at the public offering prices or, in the case of sales of Units
to a Selected Dealer or one of the Underwriters, at the public offering price
less the concession applicable thereto under Section 6 above, or any part of
such concession, and (b) in arranging for sales of Units to Selected Dealers,
to over-allot and to cover such over-allotments; it being understood that such
purchases and sales and over-allotments shall be as nearly as practicable in
the proportions in which the respective Underwriters have agreed to purchase
the Units, and that at no time shall our net position, for either long or short
account including such over-allotments, exceed 15% of the Units which we have
agreed to purchase under the Underwriting Agreement. Upon your demand, we will
pay you the cost of any Units purchased for our account and will deliver to you
any Units sold or over-allotted for our account.
We authorize you to file on our behalf with the Securities and Exchange
Commission any reports required in connection with any transaction pursuant to
this Section 8. You shall notify us promptly if you effect such transactions.
9. TERMINATION AND SETTLEMENT. Unless earlier terminated by you, this
Agreement shall terminate at the close of business on the 30th day after the
initial public offering unless extended by you for an additional period or
periods not exceeding an aggregate of 30 additional days. You may
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extend this Agreement for such period or periods and may terminate this
Agreement at any time without prior notice.
As soon as practicable after any such termination, any Units held by you
for our account or reserved by you for sale to dealers and other persons but
not sold and paid for, shall be delivered to us and our net credit or debit
balance, taking into account our share of known expenses and charges and any
necessary reserve for additional expenses, shall be received from or paid to
you.
Notwithstanding any settlement under this Agreement, we agree to pay our
proportion (based on the number of Units we agree to purchase from the Company)
of the amount of any claim, demand or liability which may be asserted against
and discharged by the Underwriters, or any of them, based on the claim that the
Underwriters constitute an association, unincorporated business or other
separate entity, and also to pay a like proportion of any transfer taxes which
may be assessed after such settlement and a like proportion of the expenses
incurred by the Underwriters, or any of them, and approved by you in contesting
any such claim, demand, liability or tax.
10. DEFAULTING UNDERWRITERS. In the event of failure of any Underwriter to
perform its obligation to take up and pay for the Units which it has agreed to
purchase, you shall have the right to arrange for other persons, who may
include yourselves, to take up and pay for such Units. In the event that such
arrangements are made, the proportions of the Units then to be purchased by the
other Underwriters and by such other person or persons, if any, shall be taken
as the basis for all rights and obligations hereunder; but this shall not in
any way affect the liability of any defaulting Underwriters to the other
Underwriters for damages resulting from such default, nor shall default in any
way relieve any other Underwriter of any of its obligations hereunder or under
the Underwriting Agreement, except as therein provided.
11. POSITION OF MANAGING UNDERWRITER. Except as herein otherwise expressly
provided, you shall have full authority to take such action as you may deem
necessary or advisable in respect of all matters pertaining to the Underwriting
Agreement and this Agreement, and the purchase, sale and distribution of the
Units, but you shall be under no liability to us except for want of good faith
and for obligations assumed by you hereunder and except for any liabilities
under the Act. No obligation not expressly assumed by you in this Agreement
shall be implied herefrom.
12. INDEMNITY. (a) We agree, and each of the several Underwriters
(including yourselves) shall agree, to indemnify, defend and hold harmless each
other Underwriter and each person who controls any other Underwriter within the
meaning of Section 15 of the Act, to the extent and upon the terms that each
Underwriter agrees to indemnify and hold harmless the Company as set forth in
Section 6 of the Underwriting Agreement.
(b) We will pay, upon your request, our proportionate share, based upon
our underwriting obligation, of any losses, damages, liabilities or expenses,
joint or several, paid or incurred by any Underwriter to any person other than
an Underwriter, arising out of or based upon any untrue statement or alleged
untrue statement of any material fact contained in the Registration Statement,
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the Prospectus, any amendments or supplements thereto or any preliminary
prospectus or any selling or advertising material approved by you for use by
the Underwriters in connection with the sale of the Units, or 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 (other than an
untrue statement or alleged untrue statement or omission or alleged omission
made in reliance upon and in conformity with written information furnished to
the Company by an Underwriter specifically for use therein) and such
proportionate share of any legal or other expenses reasonably incurred by you
or with your consent in connection with investigating or defending any claim or
action in respect of such loss, damage, liability or expense. In determining
the amount of our obligation under this Section 12(b), appropriate adjustment
may be made by you to reflect any amounts received from the Company by any one
or more Underwriters in respect of such claim pursuant to Section 6 or Section
7 of the Underwriting Agreement or otherwise. There shall be credited against
any amount paid or payable by us pursuant to this Section 12(b) any loss,
damage, liability or expense which is incurred by us as a result of any such
claim asserted against us, and if such loss, damage, liability or expense is
incurred by us subsequent to any payment by us pursuant to this Section 12(b),
appropriate provision shall be made to effect such credit, by refund or
otherwise. If any such claim is asserted, you may take such action in
connection therewith as you deem necessary or desirable, including retention of
counsel for the Underwriters and in your discretion separate counsel for any
particular Underwriter or groups of Underwriters. In determining amounts
payable pursuant to this Section 12(b) any loss, damage, liability or expense
incurred by any person controlling any Underwriter within the meaning of
Section 15 of the Act which has been incurred by reason of such control
relationship shall be deemed to have been incurred by such Underwriter. Any
Underwriter may elect to retain at its own expense its own counsel. You may
settle or consent to the settlement of any such claim with the approval of a
majority in interest of the Underwriters on advice of counsel retained by you.
Whenever you receive notice of the assertion of any claim to which the
provisions of this Section 12(b) would be applicable, you will give prompt
notice thereof to each Underwriter. You will also furnish each Underwriter with
periodic reports, at such times as you deem appropriate, as to the status of
such claim and the action taken by you in connection therewith. If any
Underwriter or Underwriters default in their obligation to make any payments
under this Section 12(b), each non-defaulting Underwriter shall be obligated to
pay its proportionate share of all defaulted payments, based upon such
Underwriter's underwriting obligation as related to the underwriting
obligations of all non-defaulting Underwriters. Nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) The indemnity agreement in this Section shall survive the termination
of this Agreement.
13. CONFIRMATION OF UNDERWRITERS. We confirm that we have examined the
Registration Statement and the amendments thereto referred to in the
Underwriting Agreement, that we are familiar with the proposed final amendment
thereto (including the proposed final form of prospectus), that we are willing
to accept the responsibilities of an underwriter under the Act in respect of
the Registration Statement and are willing to proceed with the public offering
of the Units in the manner contemplated, and that the form of the Selected
Dealer Agreement employed by you in connection with this offering is
satisfactory to us. We further confirm that the information relating to us in
such proposed final form of prospectus and the statements therein as to the
terms of the offering of the Units under the heading "Underwriting" of the
Registration Statement insofar as they relate to us are
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correct, and we authorize you, as our Managing Underwriter, so to advise the
Company. We further confirm that (a) we are members in good standing of the
NASD, or (b) we are a foreign bank, dealer or institution not registered under
the Exchange Act and we agree (i) that in making sales of the Units outside the
United States we will comply with the requirements of the NASD's Interpretation
With Respect to Free Riding and Withholding and (ii) that we will not offer or
sell any of the Units within the United States, its territories or possessions
or to persons who are citizens thereof or residents therein and, (c) we have
the ratio of net capital to aggregate indebtedness, including the indebtedness
represented by our obligation under this Agreement and under the Underwriting
Agreement, required by Rule 15c3-1 promulgated by the Commission pursuant to
the provisions of Section 15(c)(3) of the Exchange Act. We know of no
engineering, management or similar report or memorandum relating to the Company
prepared within the last year in connection with the offering by or for the
Company, a controlling person of the Company or any Underwriter which has not
been filed with the Commission. We also confirm that copies of the latest
preliminary prospectus with respect to the Units have been mailed, at least two
days prior to the date hereof, to all persons to whom it is presently expected
we will sell Units and that, if we expect to mail a confirmation of any such
sale to any person by air mail, said preliminary prospectus has been sent to
such person by air mail. In response to Securities Act Release No. 5398, we
agree that we will not sell more than five (5%) percent of the Units purchased
by us hereunder to accounts over which we exercise discretionary authority. We,
and any affiliate of ours engaged in the retail distribution of securities
which is used by us in connection with the offering of the Units, will comply
with the applicable provisions of the Selected Dealer Agreement. We will not
sell any Units at prices less than the Offering Prices except to persons who
have entered into, or agreed to enter into, the Selected Dealer Agreement. For
a period of twenty-five (25) days after the effectiveness of the Registration
Statement, or until completion of the public offering of the Units, whichever
is later, we will provide a copy of the Prospectus to any person making a
written request therefor.
14. MISCELLANEOUS. Nothing herein contained shall constitute the several
Underwriters an association, or any Underwriters partners with you or us, or
with each other, or render any Underwriter liable for the obligations of any
other Underwriter; and the rights and liabilities of ourselves and of each of
the Underwriters shall be several and not joint.
The Units purchased by us pursuant to the Underwriting Agreement shall
remain our property until sold, and no title to any such Units shall pass to
you by virtue of any of the provisions of this Agreement.
Default by any one or more Underwriters in respect of their several
obligations shall not release us or any other Underwriter from any obligations
hereunder.
You shall not have any responsibility with respect to the right of any
Underwriter or other person to sell the Units in any jurisdiction,
notwithstanding any information you may furnish in that connection. We
authorize you to file with the New York authorities, as syndicate manager, a
Further State Notice relating to the Units if required.
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The section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this Agreement.
This Agreement shall be governed by, and construed and enforced in
accordance with, the internal laws of the State of New York, and we hereby
consent and shall submit to the jurisdiction of the courts of the State of New
York and of any federal court sitting in the City of New York with respect to
controversies arising under this Agreement.
15. NOTICES. Any notice from you to us shall be deemed to have been duly
given if mailed, telephoned, telegraphed or delivered to us at our address set
forth after on Schedule A to the attached Underwriting Agreement.
16. EXECUTION OF AGREEMENT. This Agreement has been executed by us and is
delivered to you in duplicate. Your confirmation hereof shall constitute this
Agreement a valid and binding contract between you and us and each party to a
similarly confirmed agreement substantially identical herewith, and this and
such other agreements shall constitute the Agreement Among Underwriters.
Very truly yours,
By:_________________________________
Attorney-in-fact for each of the
several Underwriters named in
Schedule A of the attached
Underwriting Agreement
Confirmed as of the date first above written:
X.X. XXXXXXX & CO., INC.
By:___________________________
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