EXHIBIT 1.1
3,450,000 Shares
Common Stock
($0.04 Par Value)
UNDERWRITING AGREEMENT
----------------------
February __, 2000
X.X. Xxxxxxx & Sons, Inc.
Xxxx Xxxxxxxx Incorporated
The Xxxxxxxx-Xxxxxxxx Company, LLC
XX Xxxxx Securities Corporation
As Representatives of the Several Underwriters
c/o X.X. Xxxxxxx & Sons, Inc.
Xxx Xxxxx Xxxxxxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
The undersigned, Xxxxxx Xxxxxx, Inc., a New York corporation (the
"Company"), and the persons listed on Schedule I hereto (the "Selling
Shareholders"), hereby address you as the representatives (the
"Representatives") of each of the persons, firms and corporations listed on
Schedule II hereto (collectively, the "Underwriters") and hereby confirm their
agreement with the several Underwriters as follows:
1. Description of Shares. The Company proposes to issue and sell to
the Underwriters Three Million (3,000,000) shares of its Common Stock, par value
$0.04 per share, (the "Firm Shares"). Solely for the purpose of covering over-
allotments in the sale of the Firm Shares, each of the Company and the Selling
Shareholders proposes to grant to the Underwriters the right to purchase up to
an additional Four Hundred Fifty Thousand (450,000) shares of Common Stock (the
"Option Shares"), as provided in Section 3 of this Agreement. The Firm Shares
and the Option Shares are herein sometimes referred to as the "Shares" and are
more fully described in the Prospectus hereinafter defined.
2. Purchase, Sale and Delivery of Firm 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 under the terms hereof the Firm Shares, and each such Underwriter
agrees, severally and not jointly, to purchase from the Company, pro rata, at a
purchase price of $___ per share, the number of Firm Shares set forth opposite
the name of such Underwriter in Schedule II hereto.
The Company will deliver definitive certificates (for purposes herein,
"definitive certificates" will include any electronic format equivalent
reasonably acceptable to the
Representatives) for the Firm Shares at the office of X.X. Xxxxxxx & Sons, Inc.,
Xxx Xxxxx Xxxxxxxxx Xxxxxx, Xx. Xxxxx, Xxxxxxxx 00000 ("Xxxxxxx' Office"), or
such other place as you and the Company may mutually agree upon, for the
accounts of the Underwriters against payment to the Company of the purchase
price for the Firm Shares sold by them to the several Underwriters by wire
transfer of funds payable to the order of the Company, and delivered to Xxx
Xxxxx Xxxxxxxxx Xxxxxx, Xx. Xxxxx, Xxxxxxxx 00000, or at such other place as may
be agreed upon between you and the Company (the "Place of Closing"), at 9:00
a.m., St. Louis time, on ____________, 2000, or at such other time and date not
later than five full business days thereafter as you and the Company may agree,
such time and date of payment and delivery being herein called the "Closing
Date."
The certificates for the Firm Shares so to be delivered will be made
available to you for inspection at Xxxxxxx' Office (or such other place as you
and the Company may mutually agree upon) at least one full business day prior to
the Closing Date and will be in such names and denominations as you may request
at least forty-eight hours prior to the Closing Date.
It is understood that an Underwriter, individually, may (but shall not
be obligated to) make payment on behalf of the other Underwriters whose funds
shall not have been received prior to the Closing Date for Shares to be
purchased by such Underwriter. Any such payment by an Underwriter shall not
relieve the other Underwriters of any of their obligations hereunder.
It is understood that the Underwriters propose to offer the Shares to
the public upon the terms and conditions set forth in the Registration Statement
hereinafter defined.
3. Purchase, Sale and Delivery of the Option Shares. The Company and
the Selling Shareholders hereby grant options to the Underwriters to purchase
from them, on a pro rata basis, up to Four Hundred Fifty Thousand (450,000)
Option Shares on the same terms and conditions as the Firm Shares; provided,
however, that such options may be exercised only for the purpose of covering any
over-allotments which may be made by them in the sale of the Firm Shares. No
Option Shares shall be sold or delivered unless the Firm Shares previously have
been, or simultaneously are, sold and delivered. Each Selling Shareholder shall
sell up to that number of Option Shares set forth opposite the name of such
Selling Shareholder on Schedule I hereto.
The options are exercisable on behalf of the several Underwriters by
you, as Representatives, at any time, and from time to time, before the
expiration of 30 days from the date of the Prospectus (or, if such 30th day
shall be a Saturday or Sunday or a holiday, on the next day thereafter when the
American Stock Exchange is open for trading), for the purchase of all or part of
the Option Shares covered thereby, by notice given by you to the Company and the
Selling Shareholders in the manner provided in Section 13 hereof, setting forth
the number of Option Shares as to which the Underwriters are exercising the
options, and the date of delivery of said Option Shares, which date shall not be
more than five business days after such notice unless otherwise agreed to by the
parties. You may terminate the options at any time, as to any
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unexercised portion thereof, by giving written notice to the Company and the
Selling Shareholders to such effect.
You, as Representatives, shall make such allocation of the Option
Shares among the Underwriters as may be required to eliminate purchases of
fractional Shares.
Delivery of the Option Shares with respect to which the options shall
have been exercised shall be made to or upon your order at Xxxxxxx' Office (or
at such other place as you and the Company may mutually agree upon), against
payment by you of the per share purchase price to the Company and the Selling
Shareholders by wire transfer of funds. Such payment and delivery shall be made
at 9:00 a.m., St. Louis time, on the date designated in the notice given by you
as above provided for (which may be the same as the Closing Date), unless some
other date and time are agreed upon, which date and time of payment and delivery
are called the "Option Closing Date." The certificates for the Option Shares so
to be delivered will be made available to you for inspection at Xxxxxxx' Office
at least one full business day prior to the Option Closing Date and will be in
such names and denominations as you may request at least forty-eight hours prior
to the Option Closing Date. On the Option Closing Date, the Company shall
provide the Underwriters such representations, warranties, agreements, opinions,
letters, certificates and covenants with respect to the Option Shares as are
required to be delivered on the Closing Date with respect to the Firm Shares.
4. Representations, Warranties and Agreements of the Company and the
Selling Shareholders. (a) The Company represents and warrants to and agrees
with each Underwriter that:
(i) A registration statement on Form S-3 (Registration No. 333-
94729) with respect to the Shares, including a preliminary prospectus, and
such amendments to such registration statement as may have been required to
the date of this Agreement, has been carefully prepared by the Company
pursuant to and in conformity with the requirements of the Securities Act
of 1933, as amended (the "1933 Act"), and the rules and regulations
thereunder (the "1933 Act Rules and Regulations") of the Securities and
Exchange Commission (the "SEC") and has been filed with the SEC under the
1933 Act. The Company meets the requirements for use of Form S-3 under the
1933 Act. Copies of such registration statement, including any amendments
thereto, each related preliminary prospectus (meeting the requirements of
Rule 430 or 430A of the 1933 Act Rules and Regulations) contained therein,
and the exhibits, financial statements and schedules thereto have
heretofore been delivered by the Company to you. If such registration
statement has not become effective under the 1933 Act, a further amendment
to such registration statement, including a form of final prospectus,
necessary to permit such registration statement to become effective will be
filed promptly by the Company with the SEC. If such registration statement
has become effective under the 1933 Act, a final prospectus containing
information permitted to be omitted at the time of effectiveness by Rule
430A of the 1933 Act Rules and Regulations will be filed promptly by the
Company
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with the SEC in accordance with Rule 424(b) of the 1933 Act Rules and
Regulations. The term "Registration Statement" as used herein means the
registration statement as amended at the time it becomes effective under
the 1933 Act (the "Effective Date"), including financial statements and all
exhibits and all documents incorporated by reference therein pursuant to
Item 12 of Form S-3 under the 1933 Act and, if applicable, the information
deemed to be included by Rule 430A of the 1933 Act Rules and Regulations.
If it is contemplated, at the time this Agreement is executed, that a
post-effective amendment to such registration statement will be filed and
must be declared effective before the offering of Shares may commence, the
term "Registration Statement" as used herein means the registration
statement as amended by said post-effective amendment. If an abbreviated
registration statement is prepared and filed with the SEC in accordance
with Rule 462(b) under the 1933 Act (an "Abbreviated Registration
Statement"), the term "Registration Statement" as used in this Agreement
includes the Abbreviated Registration Statement. The term "Prospectus" as
used herein means (i) the prospectus as first filed with the SEC pursuant
to Rule 424(b) of the 1933 Act Rules and Regulations, or (ii) if no such
filing is required, the form of final prospectus included in the
Registration Statement at the Effective Date or (iii) if a Term Sheet or
Abbreviated Term Sheet (as such terms are defined in Rule 434(b) and
434(c), respectively, of the 1933 Act Rules and Regulations) is filed with
the SEC pursuant to Rule 424(b)(7) of the 1933 Act Rules and Regulations,
the Term Sheet or Abbreviated Term Sheet and the last Preliminary
Prospectus filed with the SEC prior to the time the Registration Statement
became effective, taken together, including, in each case, the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the
1933 Act. The term "Preliminary Prospectus" as used herein shall mean a
preliminary prospectus as contemplated by Rule 430 or 430A of the 1933 Act
Rules and Regulations included at any time in the Registration Statement.
For purposes of this Agreement, the words "amend," "amendment," "amended,"
"supplement" or "supplemented" with respect to the Registration Statement
or the Prospectus shall mean amendments or supplements to the Registration
Statement or the Prospectus, as the case may be, as well as documents filed
after the date of this Agreement and prior to the completion of the
distribution of the Shares and incorporated by reference therein as
described above.
(ii) Neither the SEC nor any state or other jurisdiction or other
regulatory body has issued, and neither is, to the knowledge of the
Company, threatening to issue, any stop order under the 1933 Act or other
order suspending the effectiveness of the Registration Statement (as
amended or supplemented) or preventing or suspending the use of any
Preliminary Prospectus or the Prospectus or suspending the qualification or
registration of the Shares for offering or sale in any jurisdiction nor
instituted or, to the knowledge of the Company, threatened to institute
proceedings for any such purpose. Each Preliminary Prospectus at its date
of issue, the Registration Statement and the Prospectus and any amendments
or supplements thereto contain or will contain, as the case may be, all
statements which are required to be stated therein by, and in all material
respects conform or will conform, as the case may be, to the requirements
of, the 1933
4
Act and the 1933 Act Rules and Regulations. Neither the Registration
Statement nor any amendment thereto, as of the applicable effective date,
contains or will contain, as the case may be, any untrue statement of a
material fact or omits or will omit to state any material fact required to
be stated therein or necessary to make the statements therein, not
misleading, and neither any Preliminary Prospectus, the Prospectus nor any
supplement thereto contains or will contain, as the case may be, any untrue
statement of a material fact or omits or will 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; provided, however, that the Company makes no representation or
warranty as to information contained in or omitted from the Registration
Statement or the Prospectus, or any such amendment or supplement, in
reliance upon, and in conformity with, written information furnished to the
Company relating to the Underwriters by or on behalf of the Underwriters
expressly for use in the preparation thereof (as provided in Section 14
hereof). There is no contract or document required to be described in the
Registration Statement or Prospectus or to be filed as an exhibit to the
Registration Statement which is not described or filed as required. The
documents incorporated by reference in the Prospectus pursuant to Item 12
of Form S-3 under the 1933 Act, at the time they were filed with the SEC,
complied in all material respects with the requirements of the Securities
Exchange Act of 1934, as amended (the "1934 Act"), and the rules and
regulations adopted by the SEC thereunder (the "1934 Act Rules and
Regulations"). Any future documents incorporated by reference in the
Prospectus pursuant to Item 12 of Form S-3 under the 1933 Act, when they
are so filed, will comply in all material respects with the requirements of
the 1934 Act and the 1934 Act Rules and Regulations; no such incorporated
document contained or will contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading; and, when read together and
with the other information in the Prospectus, at the time the Registration
Statement became effective and at the Closing Date, each such incorporated
document did not or will not, as the case may be, contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading.
(iii) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid and legally binding
obligation of the Company enforceable against the Company in accordance
with its terms, except as enforceability may be limited by bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights generally and by
general principles of equity (the "Exceptions").
(iv) The Company and its Active Subsidiaries have been duly
organized and are validly existing as corporations in good standing under
the laws of the states or other jurisdictions in which they are
incorporated, with full power and authority (corporate and other) to own,
lease and operate their properties and conduct their businesses as
described
5
in the Prospectus and, with respect to the Company, to execute and deliver,
and perform the Company's obligations under, this Agreement; the Company
and its Active Subsidiaries are duly qualified to do business as foreign
corporations in good standing in each state or other jurisdiction in which
their ownership or leasing of property or conduct of business legally
requires such qualification, except where the failure to be so qualified,
individually or in the aggregate, would not have a Material Adverse Effect.
The term "Material Adverse Effect" as used herein means any material
adverse effect on the condition (financial or other), net worth, business,
affairs, management, prospects, results of operations or cash flow of the
Company and its Active Subsidiaries, taken as a whole. The entities listed
on Exhibit A hereto are the only subsidiaries, direct or indirect, of the
Company. The term "Active Subsidiaries" as used herein means the active
subsidiaries, direct or indirect, of the Company, which are identified as
such on Exhibit A. Each of the Company's inactive subsidiaries has minimal
or no assets and no active operations. The Company owns, directly or
indirectly through other subsidiaries, the percentage indicated on Exhibit
A of the outstanding shares of capital stock or other securities evidencing
equity ownership of each of its subsidiaries.
(v) Neither the Company nor any of its Active Subsidiaries has
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any material loss
or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree. Otherwise than as set forth
in the Prospectus and, since the respective dates as of which information
is given in the Prospectus, there has not been any change in the capital
stock or long-term debt of the Company or any of its subsidiaries or any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of operations of the
Company and its subsidiaries taken as a whole, otherwise than as set forth
in the Prospectus.
(vi) The issuance and sale of the Shares and the execution,
delivery and performance by the Company of this Agreement, and the
consummation of the transactions herein contemplated, will not conflict
with or result in a breach or violation of any of the terms or provisions
of, or constitute a default under, or result in the creation or imposition
of any lien, charge or encumbrance upon any properties or assets of the
Company or any of its subsidiaries under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the Company
or any of its subsidiaries is a party or by which the Company or any of
its subsidiaries is bound or to which any of the properties or assets of
the Company or any of its subsidiaries is subject, except to such extent
as, individually or in the aggregate, does not have a Material Adverse
Effect, nor will such action result in any violation of the provisions of
the Company's certificate of incorporation or bylaws or any statute, rule,
regulation or other law, or any order or judgment, of any court or
governmental agency or body having
6
jurisdiction over the Company or any of its subsidiaries or any of their
properties; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the execution, delivery and performance of this Agreement, the
issuance and sale of the Shares or the consummation of the transactions
contemplated hereby, except such as have been, or will be prior to the
Closing Date, obtained under the 1933 Act or as may be required by the
National Association of Securities Dealers, Inc. (the "NASD") and such
consents, approvals, authorizations, registrations or qualifications as may
be required under state securities laws in connection with the purchase and
distribution of the Shares by the Underwriters.
(vii) The Company has duly and validly authorized capital stock
as set forth in the Prospectus; all outstanding shares of Common Stock of
the Company and the Shares conform, or when issued will conform, to the
description thereof in the Prospectus and have been, or, when issued and
paid for in the manner described herein will be, duly authorized, validly
issued, fully paid and non-assessable; and the issuance of the Shares to be
purchased from the Company hereunder is not subject to preemptive or other
similar rights, or any restriction upon the voting or transfer thereof
pursuant to applicable law or the Company's certificate of incorporation,
by-laws or governing documents or any agreement to which the Company or any
of its subsidiaries is a party or by which any of them may be bound. All
corporate action required to be taken by the Company for the authorization,
issuance and sale of the Shares has been duly and validly taken. Except as
disclosed in the Prospectus, there are no outstanding subscriptions,
rights, warrants, options, calls, convertible securities, commitments of
sale or rights related to or entitling any person to purchase or otherwise
to acquire any shares of, or any security convertible into or exchangeable
or exercisable for, the capital stock of, or other ownership interest in,
the Company. The outstanding shares of capital stock or other securities
evidencing equity ownership of all of the Company's subsidiaries excluding
Heritage Labs International, L.L.C. and the Company's 55% ownership
interest in Heritage Labs International, L.L.C. have been duly authorized
and validly issued, are fully paid and non-assessable and are owned by the
Company free and clear of any mortgage, pledge, lien, encumbrance, charge
or adverse claim and are not the subject of any agreement or understanding
with any person and were not issued in violation of any preemptive or
similar rights; and there are no outstanding subscriptions, rights,
warrants, options, calls, convertible securities, commitments of sale or
instruments related to or entitling any person to purchase or otherwise
acquire any shares of, or any security convertible into or exchangeable or
exercisable for, the capital stock of, or other ownership interest in any
of the subsidiaries.
(viii) The statements set forth or incorporated by reference in
the Prospectus describing the Shares and this Agreement, insofar as they
purport to describe the provisions of the laws and documents referred to
therein, are accurate, complete and fair.
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(ix) Each of the Company and its Active Subsidiaries is in
possession of and is operating in compliance with all franchises, grants,
authorizations, licenses, certificates, permits, easements, consents,
orders and approvals ("Permits") from all state, federal, foreign and other
regulatory authorities, and has satisfied the requirements imposed by
regulatory bodies, administrative agencies or other governmental bodies,
agencies or officials, that are required for the Company and its Active
Subsidiaries lawfully to own, lease and operate their properties and
conduct their businesses as described in the Prospectus, and, each of the
Company and its Active Subsidiaries is conducting its business in
compliance with all of the laws, rules and regulations of each jurisdiction
in which it conducts its business, in each case with such exceptions,
individually or in the aggregate, as would not have a Material Adverse
Effect; each of the Company and its Active Subsidiaries has filed all
notices, reports, documents or other information ("Notices") required to be
filed under applicable laws, rules and regulations, in each case, with such
exceptions, individually or in the aggregate, as would not have a Material
Adverse Effect; and, except as otherwise specifically described in the
Prospectus, neither the Company nor any of its Active Subsidiaries has
received any notification from any court or governmental body, authority or
agency, relating to the revocation or modification of any such Permit or,
to the effect that any additional authorization, approval, order, consent,
license, certificate, permit, registration or qualification ("Approvals")
from such regulatory authority is needed to be obtained by any of them, in
any case where it could be reasonably expected that obtaining such
Approvals or the failure to obtain such Approvals, individually or in the
aggregate, would have a Material Adverse Effect.
(x) The Company and its subsidiaries have filed all necessary
federal, state and foreign income and franchise tax returns and, except
with respect to taxes being contested in good faith, paid all taxes shown
as due thereon; all such tax returns are complete and correct in all
material respects; all tax liabilities are adequately provided for on the
books of the Company and its subsidiaries except to such extent as would
not have a Material Adverse Effect; the Company and its subsidiaries have
made all necessary payroll tax payments and are current and up-to-date,
except to such extent as would not have a Material Adverse Effect; and the
Company and its subsidiaries have no knowledge of any tax proceeding or
action pending or threatened against the Company or its subsidiaries which,
individually or in the aggregate, might have a Material Adverse Effect.
(xi) Except as described in the Prospectus, the Company and its
Active Subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, patent licenses, trademarks, service marks and trade
names necessary to conduct the business now operated by them, and neither
the Company nor any of its Active Subsidiaries has received any notice of
infringement of or conflict with asserted rights of others with respect to
any patents, patent licenses, trademarks, service marks or trade names
which,
8
individually or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would have a Material Adverse Effect.
(xii) The Company and its Active Subsidiaries have good and
marketable title in fee simple to all items of real property and good and
marketable title to all personal property owned by them, in each case free
and clear of all liens, encumbrances, restrictions and defects except such
as are described in the Prospectus or do not materially affect the value of
such property and do not interfere with the use made and proposed to be
made of such property; and any property held under lease or sublease by the
Company or any of its Active Subsidiaries is held under valid, subsisting
and enforceable leases or subleases with such exceptions as are not
material and do not interfere with the use made and proposed to be made of
such property by the Company and its Active Subsidiaries; and neither the
Company nor any of its Active Subsidiaries has any notice or knowledge of
any material claim of any sort which has been, or may be, asserted by
anyone adverse to the Company's or any of its Active Subsidiaries rights as
lessee or sublessee under any lease or sublease described above, or
affecting or questioning the Company's or any of its Active Subsidiaries'
rights to the continued possession of the leased or subleased premises
under any such lease or sublease in conflict with the terms thereof.
(xiii) Except as described in the Prospectus, there is no
factual basis for any action, suit or other proceeding involving the
Company or any of its subsidiaries or any of their material assets for any
failure of the Company or any of its subsidiaries, or any predecessor
thereof, to comply with any requirements of federal, state or local
regulation relating to air, water, solid waste management, hazardous or
toxic substances, or the protection of health or the environment. Except
as described in the Prospectus, none of the property owned or leased by the
Company or any of its subsidiaries is contaminated with any waste or
hazardous substances, and neither the Company nor any of its subsidiaries
may be deemed an "owner or operator" of a "facility" or "vessel" which
owns, possesses, transports, generates or disposes of a "hazardous
substance" as those terms are defined in (S)9601 of the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C.
(S)9601 et seq.
------
(xiv) No labor disturbance exists with the employees of the
Company or any of its Active Subsidiaries or is imminent which,
individually or in the aggregate, would have a Material Adverse Effect.
None of the employees of the Company or any of its Active Subsidiaries is
represented by a union and, to the best knowledge of the Company and its
Active Subsidiaries, no union organizing activities are taking place.
Neither the Company nor any of its Active Subsidiaries has violated any
federal, state or local law or foreign law relating to discrimination in
hiring, promotion or pay of employees, nor any applicable wage or hour
laws, or the rules and regulations thereunder, or analogous foreign laws
and regulations, which might, individually or in the aggregate, result in a
Material Adverse Effect.
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(xv) The Company and its Active Subsidiaries are in compliance in
all material respects with all presently applicable provisions of the
Employee Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder ("ERISA"); no
"reportable event" (as defined in ERISA) has occurred with respect to any
"pension plan" (as defined in ERISA) for which the Company and its Active
Subsidiaries would have any liability; the Company and its Active
Subsidiaries have not incurred and do not expect to incur liability under
(i) Title IV of ERISA with respect to termination of, or withdrawal from,
any "pension plan" or (ii) Sections 412 or 4971 of the Internal Revenue
Code of 1986, as amended, including the regulations and published
interpretations thereunder (the "Code"); and each "pension plan" for which
the Company or any of its Active Subsidiaries would have any liability that
is intended to be qualified under Section 401(a) of the Code is so
qualified in all material respects, and nothing has occurred, whether by
action or by failure to act, which would cause the loss of such
qualification.
(xvi) The Company and its Active Subsidiaries maintain insurance
of the types and in the amounts generally deemed adequate for its business,
including, but not limited to, directors' and officers' insurance,
insurance covering real and personal property owned or leased by the
Company and its Active Subsidiaries against theft, damage, destruction,
acts of vandalism and all other risks customarily insured against, all of
which insurance is in full force and effect. Neither the Company nor any
of its Active Subsidiaries has been refused any insurance coverage sought
or applied for, and the Company has no reason to believe that it and its
Active Subsidiaries will not be able to renew their existing insurance
coverage as and when such coverage expires or to obtain similar coverage
from similar insurers as may be necessary to continue its business at a
cost that would not have a Material Adverse Effect.
(xvii) Neither the Company nor any of its Active Subsidiaries
is, or with the giving of notice or lapse of time or both would be, in
default or violation with respect to its certificate of incorporation or
by-laws. Neither the Company nor any of its Active Subsidiaries is, or
with the giving of notice or lapse of time or both would be, in default in
the performance or observance of any material obligation, agreement,
covenant or condition contained in any indenture, mortgage, deed of trust,
loan agreement, lease or other agreement or instrument to which the Company
or any of its Active Subsidiaries is a party or by which the Company or any
of its Active Subsidiaries is bound or to which any of the properties or
assets of the Company or any of its Active Subsidiaries is subject, or in
violation of any statutes, laws, ordinances or governmental rules or
regulations or any orders or decrees to which it is subject, including,
without limitation, Section 13 of the 1934 Act, which default or violation,
individually or in the aggregate, would have a Material Adverse Effect.
Neither the Company nor any of its subsidiaries has, at any time during the
past five years, (A) made any unlawful contributions to any candidate for
any political office, or failed fully to disclose any contribution in
violation of law, or (B) made any payment to any state, federal or foreign
government official, or other person
10
charged with similar public or quasi-public duty (other than payment
required or permitted by applicable law).
(xviii) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which the Company or any of
its subsidiaries is a party or of which any property of the Company or any
of its subsidiaries is the subject that, if determined adversely to the
Company or any of its subsidiaries, would individually or in the aggregate
have a Material Adverse Effect or which would materially and adversely
affect the consummation of the transactions contemplated hereby or which is
required to be disclosed in the Prospectus; to the best of the Company's
knowledge, no such proceedings are threatened or contemplated.
(xix) The Company is not and, after giving effect to the
offering and sale of the Shares, will not be a "holding company," or a
"subsidiary company" of a "holding company," or an "affiliate" of a
"holding company" or of a "subsidiary company," as such terms are defined
in the Public Utility Holding Company Act of 1935, as amended (the "1935
Act").
(xx) The Company is not and, after giving effect to the offering
and sale of the Shares, will not be an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the
Investment Company Act of 1940, as amended (the "1940 Act").
(xxi) KPMG LLP, the accounting firm which has certified the
financial statements of the Company filed with or incorporated by reference
in and as a part of the Registration Statement, and, to the best knowledge
of the Company, Ernst & Young LLP, the accounting firm which has certified
the financial statements of Paramedical Services of America, Inc. filed
with or incorporated by reference in and as a part of the Registration
Statement, are independent public accounting firms within the meaning of
the 1933 Act and the 1933 Act Rules and Regulations. The Company and each
of its Active Subsidiaries maintains a system of internal accounting
controls sufficient to provide reasonable assurance that: (1) transactions
are executed in accordance with management's general or specific
authorizations; (2) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (3) access
to assets is permitted only in accordance with management's general or
specific authorization; and (4) the recorded accounts for assets is
compared with the existing assets at reasonable intervals and appropriate
action is taken with respect thereto. The consolidated financial
statements and schedules of the Company, including the notes thereto, filed
with (or incorporated by reference) and as a part of the Registration
Statement or Prospectus, are accurate in all material respects and present
fairly the financial condition of the Company and its subsidiaries as of
the respective dates thereof and the consolidated results of operations and
changes in financial position and
11
consolidated statements of cash flow for the respective periods covered
thereby, all in conformity with generally accepted accounting principles
applied on a consistent basis throughout the periods involved except as
otherwise disclosed therein. All adjustments necessary for a fair
presentation of results for such periods have been made. The selected
financial data of the Company and its subsidiaries included or incorporated
by reference in the Registration Statement and Prospectus present fairly
the information shown therein and have been compiled on a basis consistent
with that of the audited financial statements. Any operating or other
statistical data included or incorporated by reference in the Registration
Statement and Prospectus comply in all material respects with the 1933 Act
and the 1933 Act Rules and Regulations and present fairly the information
shown therein. The pro forma financial statements (including the notes
thereto) and the other pro forma financial information included in the
Prospectus (A) comply as to form in all material respects with the
applicable requirements of Regulation S-X for Form S-3 promulgated under
the 1933 Act, as amended, and (B) have been properly computed on the bases
described therein; the assumptions used in the preparation of the pro forma
financial data and other pro forma financial information included in the
Prospectus are reasonable and the adjustments used therein are appropriate
to give effect to the transactions or circumstances referred to therein;
(xxii) Except as disclosed in the Prospectus, no holder of any
security of the Company has any right to require registration of shares of
Common Stock or any other security of the Company because of the filing of
the Registration Statement or the consummation of the transactions
contemplated hereby, and, except as disclosed in the Prospectus, no person
has the right to require registration under the 1933 Act of any shares of
Common Stock or other securities of the Company. No person has the right,
contractual or otherwise, to cause the Company to permit such person to
underwrite the sale of any of the Shares. Except for this Agreement, there
are no contracts, agreements or understandings between the Company or any
of its subsidiaries and any person that would give rise to a valid claim
against the Company, its subsidiaries or any Underwriter for a brokerage
commission, finder's fee or like payment in connection with the issuance,
purchase and sale of the Shares.
(xxiii) The Company has not distributed and, prior to the later
to occur of (i) the Closing Date or the Option Closing Date, if any, and
(ii) completion of the distribution of the Shares, will not distribute any
offering material in connection with the offering and sale of the Shares
other than the Registration Statement, the Preliminary Prospectus or the
Prospectus.
(xxiv) The Company has not taken and will not take, directly or
indirectly, any action designed to or which might reasonably be expected to
cause or result in stabilization or manipulation of the price of the
Company's Common Stock, and the Company is not aware of any such action
taken or to be taken by affiliates of the Company.
12
(b) Each Selling Shareholder severally represents and warrants to and
agrees with each Underwriter and the Company that:
(i) All consents, approvals, authorizations and orders
necessary for the execution and delivery by it or him of this Agreement,
and the Custody Agreement and Power of Attorney (as defined herein) and the
sale and delivery of the Shares to be sold by such Selling Shareholder
hereunder and thereunder have been given and are in full force and effect
on the date hereof and will be in full force and effect on the Option
Closing Date, if any. This Agreement and the Custody Agreement and Power of
Attorney have been duly authorized, executed and delivered by or on behalf
of such Selling Shareholder and are the valid and legally binding
obligations of such Selling Shareholder enforceable in accordance with
their terms except as enforceability may be limited by the Exceptions.
(ii) Such Selling Shareholder has, and on the Option Closing
Date, if any, will have good, valid and marketable title to the Shares to
be sold by such Selling Shareholder, free and clear of all liens,
mortgages, pledges, encumbrances, claims, equities and security interests
whatsoever, including any restriction on transfer other than pursuant to
this Agreement and the Custody Agreement and Power of Attorney referred to
herein, and now has, and on the Option Closing Date, if any, will have,
full right, power and authority, and any approval required by law, to enter
into this Agreement and the Custody Agreement and Power of Attorney and to
sell, assign, transfer and deliver the Shares to be sold by such Selling
Shareholder hereunder.
(iii) Upon delivery of and payment for such Shares hereunder,
the several Underwriters will acquire good, valid and marketable title to
such Shares to be sold by such Selling Shareholder hereunder, free and
clear of all liens, mortgages, pledges, encumbrances, claims, equities and
security interests whatsoever.
(iv) The execution, delivery and performance of this Agreement
and the Custody Agreement and Power of Attorney by such Selling
Shareholder, and the consummation by such Selling Shareholder of the
transactions contemplated herein and therein will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any
lien, charge or encumbrance upon any of the properties or assets of such
Selling Shareholder under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which such Selling
Shareholder is a party or by which it is bound or to which any of the
properties or assets of such Selling Shareholder is subject (or any
certificate or articles of incorporation or bylaws, partnership agreement,
trust document or articles of association of such Selling Shareholder, as
applicable), or any order or decree, or statute, law, ordinance, rule or
regulation applicable to such Selling
13
Shareholder of any court or of any governmental agency, authority or body
having jurisdiction over such Selling Shareholder or its properties or
assets.
(v) Such Selling Shareholder does not have any knowledge or
any reason to believe that the Registration Statement or the Prospectus (or
any amendment or supplement thereto) contains any untrue statement of a
material fact or omits to state any material fact required to be stated
therein or necessary to make the statements therein not misleading. The
representations and warranties of such Selling Shareholder in the Custody
Agreement and Power of Attorney are, and on the Option Closing Date, if
any, will be true and correct.
(vi) Such Selling Shareholder has not taken and will not take,
directly or indirectly, any action designed to or which might be reasonably
expected to cause or result in stabilization or manipulation of the price
of the Common Stock, and such Selling Shareholder is not aware of any such
action taken or to be taken by affiliates of such Selling Shareholder.
(vii) When the Registration Statement becomes effective and at
all times subsequent thereto, such information in the Registration
Statement and Prospectus and any amendments or supplements thereto as
specifically relates to such Selling Shareholder will not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading.
(viii) Certificates in negotiable form representing all of the
Shares to be sold by such Selling Shareholder hereunder have been placed in
the custody of Xxxx Xxxx (the "Custodian") under a Custody Agreement and
Power of Attorney (the "Custody Agreement and Power of Attorney"), duly
executed and delivered by such Selling Shareholder, with the Custodian
having the authority to deliver the Shares to be sold by such Selling
Shareholder hereunder, and such Selling Shareholder has duly executed and
delivered the Custody Agreement and Power of Attorney appointing Xxxx Xxxx
and Xxxxxx Xxxxxxx Xxxxxx as such Selling Shareholder's agents and
attorneys-in-fact (the "Attorneys-in-Fact") with the Attorneys-in-Fact
having authority to execute and deliver this Agreement on behalf of such
Selling Shareholder, to determine the purchase price to be paid by the
Underwriters to the Selling Shareholders as provided in Section 2, to
authorize the delivery of the Shares to be sold by it or him hereunder and
otherwise to act on behalf of such Selling Shareholder in connection with
the transactions contemplated by this Agreement and such Custody Agreement.
(ix) The Shares represented by the certificates held in custody
for such Selling Shareholder under the Custody Agreement and Power of
Attorney are subject to the interests of the Underwriters hereunder, and
the arrangements made by such Selling Shareholder for such custody, and the
appointment by such Selling Shareholder of the
14
Custodian and of the Attorneys-in-Fact under the Custody Agreement and
Power of Attorney, are, except as specifically provided therein,
irrevocable.
(x) The obligations of such Selling Shareholder hereunder and
under the Custody Agreement and Power of Attorney shall not be terminated
by any Selling Shareholder or operation of law, whether by the death or
incapacity of any individual Selling Shareholder or, in the case of an
estate or trust, by the death or incapacity of any executor or trustee or
the termination of such estate or trust, or, in the case of a partnership,
corporation or other entity, upon any dissolution, winding up, distribution
of assets or other event affecting the legal existence of such Selling
Shareholder, or by the occurrence of any other event; and if any individual
Selling Shareholder or any such executor or trustee should die or become
incapacitated, or if any such estate or trust should be terminated, or if
any such partnership, corporation or other entity should dissolve, wind up
or distribute assets or any other event affecting the legal existence of
such Selling Shareholder should occur, or if any other such event should
occur before the delivery of the Shares hereunder, certificates
representing the Shares shall be delivered by or on behalf of each Selling
Shareholder in accordance with the terms and conditions of this Agreement
and of the Custody Agreement; and actions taken by the Custodian or by the
Attorneys-in-Fact pursuant to the Custody Agreement and Power of Attorney
shall be as valid as if such death, incapacity, termination, dissolution,
winding up, distribution of assets or other event had not occurred,
regardless of whether or not the Custodian or Attorneys-in-Fact, or any of
them, shall have received notice of such death, incapacity, termination,
dissolution, winding up, distribution of assets or other event.
(xi) Such Selling Shareholder is not prompted to sell shares of
Common Stock by any information concerning the Company or any of its
subsidiaries which is not included in the Registration Statement.
(xii) Such Selling Shareholder has not distributed and, prior to
the later to occur of (i) the Closing Date or the Option Closing Date, if
any, and (ii) completion of the distribution of the Shares, will not
distribute any offering material in connection with the offering and sale
of the Shares other than the Registration Statement, the Preliminary
Prospectus or the Prospectus.
(c) Any certificate signed by any officer of the Company and delivered
to you or to counsel for the Underwriters shall be deemed a representation and
warranty by the Company to each Underwriter as to the matters covered thereby;
and any certificate signed by or on behalf of the Selling Shareholders as such
and delivered to you or to counsel for the Underwriters shall be deemed a
representation and warranty by the Selling Shareholders to each Underwriter as
to the matters covered thereby.
5. Additional Covenants. The Company and, where expressly indicated,
the Selling Shareholders covenant and agree with the several Underwriters that:
15
(a) The Company will timely transmit copies of the Prospectus, and any
amendments or supplements thereto, or a Term Sheet or Abbreviated Term Sheet, as
applicable, to the SEC for filing pursuant to Rule 424(b) of the 1933 Act Rules
and Regulations.
(b) The Company will deliver to each of the Representatives, and to
counsel for the Underwriters (i) a signed copy of the Registration Statement as
originally filed, including copies of exhibits thereto (other than any exhibits
incorporated by reference, therein), of any amendments and supplements to the
Registration Statement (including all documents incorporated by reference
therein) and (ii) a signed copy of each consent and certificate included or
incorporated by reference in, or filed as an exhibit to, the Registration
Statement as so amended or supplemented; the Company will deliver to the
Underwriters through the Representatives as soon as practicable after the date
of this Agreement as many copies of the Prospectus (including all documents
incorporated by reference therein) as the Representatives may reasonably request
for the purposes contemplated by the 1933 Act; if the Registration Statement is
not effective under the 1933 Act, the Company will use its best efforts to cause
the Registration Statement to become effective as promptly as possible, and it
will notify you, promptly after it shall receive notice thereof, of the time
when the Registration Statement has become effective; the Company will promptly
advise the Representatives of any request of the SEC for amendment of the
Registration Statement or for supplement to the Prospectus or for any additional
information, and of the issuance by the SEC or any state or other jurisdiction
or other regulatory body of any stop order under the 1933 Act or other order
suspending the effectiveness of the Registration Statement (as amended or
supplemented) or preventing or suspending the use of any Preliminary Prospectus
or the Prospectus or suspending the qualification or registration of the Shares
for offering or sale in any jurisdiction, and of the institution or threat of
any proceedings therefor, of which the Company shall have received notice or
otherwise have knowledge prior to the completion of the distribution of the
Shares; and the Company will use its best efforts to prevent the issuance of any
such stop order or other order and, if issued, to secure the prompt removal
thereof.
(c) The Company will not file any amendment or supplement to the
Registration Statement, the Prospectus (or any other prospectus relating to the
Shares filed pursuant to Rule 424(b) of the 1933 Act Rules and Regulations that
differs from the Prospectus as filed pursuant to such Rule 424(b)) and will not
file any document under the 1934 Act before the termination of the offering of
the Shares by the Underwriters if the document would be deemed to be
incorporated by reference into the Registration Statement or the Prospectus, of
which the Underwriters shall not previously have been advised and furnished with
a copy or to which the Underwriters shall have reasonably objected or which is
not in compliance with the 1933 Act Rules and Regulations; and the Company will
promptly notify you after it shall have received notice thereof of the time when
any amendment to the Registration Statement becomes effective or when any
supplement to the Prospectus has been filed.
16
(d) During the period when a prospectus relating to any of the Shares
is required to be delivered under the 1933 Act by any Underwriter or dealer, the
Company will comply, at its own expense, with all requirements imposed by the
1933 Act and the 1933 Act Rules and Regulations, as now and hereafter amended,
and by the rules and regulations of the SEC thereunder, as from time to time in
force, so far as necessary to permit the continuance of sales of or dealing in
the Shares during such period in accordance with the provisions hereof and as
contemplated by the Prospectus.
(e) If, during the period when a prospectus relating to any of the
Shares is required to be delivered under the 1933 Act by any Underwriter or
dealer, (i) any event relating to or affecting the Company or of which the
Company shall be advised in writing by the Representatives shall occur as a
result of which, in the opinion of the Company or the Representatives, the
Prospectus as then amended or supplemented would include any untrue statement of
a material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading or (ii) it shall be necessary to amend or supplement the
Registration Statement or the Prospectus to comply with the 1933 Act, the 1933
Act Rules and Regulations, the 1934 Act or the 1934 Act Rules and Regulations,
the Company will forthwith at its expense prepare and file with the SEC, and
furnish to the Representatives a reasonable number of copies of, such amendment
or supplement or other filing that will correct such statement or omission or
effect such compliance.
(f) During the period when a prospectus relating to any of the Shares
is required to be delivered under the 1933 Act by any Underwriter or dealer, the
Company will furnish such proper information as may be lawfully required and
otherwise cooperate in qualifying the Shares for offer and sale under the
securities laws of such jurisdictions as the Representatives may reasonably
designate and will file and make in each year such statements or reports as are
or may be reasonably required by the laws of such jurisdictions; provided,
however, that the Company shall not be required to qualify as a foreign
corporation and shall not be required to qualify as a dealer in securities or to
file a general consent to service of process under the laws of any jurisdiction.
(g) In accordance with Section 11(a) of the 1933 Act and Rule 158 of
the 1933 Act Rules and Regulations, the Company will make generally available to
its security holders and to holders of the Shares, as soon as practicable, an
earning statement (which need not be audited) in reasonable detail covering the
12 months beginning not later than the first day of the month next succeeding
the month in which occurred the effective date (within the meaning of Rule 158)
of the Registration Statement.
(h) During the period when a prospectus relating to any of the Shares
is required to be delivered under the 1933 Act by any Underwriter or dealer, the
Company will file promptly all documents required to be filed with the SEC
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the 1934 Act. The Company
will furnish to its security holders annual reports containing financial
statements audited by independent public accountants and quarterly reports
containing financial
17
statements and financial information which may be unaudited. The Company will,
for a period of five years from the Closing Date, deliver to the Underwriters at
their principal executive offices copies of all reports and other communications
(financial or other) furnished to shareholders, and such nonconfidential
information concerning the business and financial condition of the Company as
the Underwriters may from time to time reasonably request. Any report, document
or other information required to be furnished under this paragraph (h) shall be
furnished as soon as practicable after such report, document or information
becomes available.
(i) During the period beginning from the date of this Agreement and
continuing to and including the earlier of (i) the termination of trading
restrictions on the Shares, as determined by the Underwriters, and (ii) 90 days
after the Effective Date, the Company will not, without the prior written
consent of the Representatives, offer for sale, sell or enter into any agreement
to sell, or otherwise dispose of, any equity securities of the Company, except
for the Shares and the issuance of its Common Stock in connection with the
exercise of options or warrants or the conversion of Preferred Stock.
(j) The Company will apply the proceeds from the sale of the Shares as
set forth in the description under "Use of Proceeds" in the Prospectus, which
description complies in all respects with the requirements of Item 504 of
Regulation S-K.
(k) The Company will promptly provide you with copies of all
correspondence to and from, and all documents issued to and by, the SEC in
connection with the registration of the Shares under the 1933 Act or relating to
any documents incorporated by reference into the Registration Statement or the
Prospectus.
(l) Prior to the Closing Date (and, if applicable, the Option Closing
Date), the Company will furnish to you, as soon as they have been prepared,
copies of any unaudited interim consolidated financial statements of the Company
and its subsidiaries for any periods subsequent to the periods covered by the
financial statements appearing in the Registration Statement and the Prospectus.
(m) Prior to the Closing Date (and, if applicable, the Option Closing
Date), neither the Company nor any Selling Shareholder will issue any press
releases or other communications directly or indirectly and none of them will
hold any press conferences with respect to the Company or any of its
subsidiaries, the financial condition, results of operations, business,
properties, assets or liabilities of the Company or any of its subsidiaries, or
the offering of the Shares, without your prior written consent.
(n) The Company will use its best efforts to obtain approval for
listing of the Shares on the American Stock Exchange.
(o) The Company will cause each of its directors and officers, and the
Selling Shareholders to furnish to you, on or prior to the date of this
Agreement, a letter or letters, in
18
form and substance satisfactory to counsel for the Underwriters, pursuant to
which each such person shall agree not to, and the Company will not, directly or
indirectly, offer for sale, contract to sell, sell, distribute, grant any
option, right or warrant to purchase, pledge, hypothecate or otherwise dispose
of any shares of Common Stock, any securities convertible into, or exercisable
or exchangeable for, Common Stock or any other rights to acquire such shares,
for a period of ninety (90) days from the Effective Date, without the prior
written consent of X.X. Xxxxxxx & Sons, Inc., except for the Shares sold
hereunder and except for sales of shares of Common Stock to the Company's
employees pursuant to the exercise of options outstanding on the date hereof
under the Company's stock option plans.
(p) During the period when a prospectus relating to any of the Shares
is required to be delivered under the 1933 Act by any Underwriter or dealer, the
Company and its Active Subsidiaries will maintain and keep accurate books and
records reflecting their assets and maintain internal accounting controls which
provide reasonable assurance that (1) transactions are executed in accordance
with management's authorization, (2) transactions are recorded as necessary to
permit the preparation of the Company's consolidated financial statements and to
maintain accountability for the assets of the Company and its subsidiaries, (3)
access to the assets of the Company and its Active Subsidiaries is permitted
only in accordance with management's authorization, and (4) the recorded
accounts of the assets of the Company and its Active Subsidiaries are compared
with existing assets at reasonable intervals.
(q) [Intentionally omitted].
(r) If the Company elects to rely on Rule 462(b) under the 1933 Act,
the Company shall both file an Abbreviated Registration Statement with the SEC
in compliance with Rule 462(b) and pay the applicable fees in accordance with
Rule 111 of the 1933 Act by the earlier of (i) 9:00 p.m., St. Louis time, on the
date of this Agreement, and (ii) the time that confirmations are given or sent,
as specified by Rule 462(b)(2).
(s) If at any time during the 90-day period after the Registration
Statement becomes effective, any rumor, publication or event relating to or
affecting the Company shall occur as a result of which in your opinion the
market price of the Common Stock has been or is likely to be materially affected
(regardless of whether such rumor, publication or event necessitates a
supplement to or amendment of the Prospectus), the Company will, after written
notice from you advising the Company to the effect set forth above, forthwith
prepare, consult with you concerning the substance of, and disseminate a press
release or other public statement, reasonably satisfactory to you, responding to
or commenting on such rumor, publication or event.
(t) Each of the Selling Shareholders severally agrees with the several
Underwriters as follows:
19
(i) Such Selling Shareholder will cooperate to the extent necessary
to cause the Registration Statement or any post-effective amendment thereto
to become effective at the earliest possible time.
(ii) Such Selling Shareholder will pay all Federal and other taxes,
if any, on the transfer or sale of the Shares being sold by the Selling
Shareholder to the Underwriters.
(iii) Such Selling Shareholder will do or perform all things required
to be done or performed by the Selling Shareholder prior to the Closing
Date or any Option Closing Date, as the case may be, to satisfy all
conditions precedent to the delivery of the Shares pursuant to this
Agreement.
(iv) For a period of ninety (90) days from the Effective Date, the
Selling Shareholders will not directly or indirectly offer for sale,
contract to sell, sell, distribute, grant any option, right or warrant to
purchase, pledge, hypothecate or otherwise dispose of any shares of Common
Stock or any securities convertible into, or exercisable or exchangeable
for, Common Stock or rights to acquire such shares, without the prior
written consent of X.X. Xxxxxxx & Sons, Inc., except for the Shares sold
hereunder.
(v) Except as stated in this Agreement and in the Preliminary
Prospectus and the Prospectus, such Selling Shareholder has not taken and
will not take, directly or indirectly, any action designed to or that might
reasonably be expected to cause or result in stabilization or manipulation
of the price of the Common Stock to facilitate the sale or resale of the
Shares.
(vi) Such Selling Shareholder will advise you promptly, and if
requested by you, will confirm such advice in writing, within the period of
time referred to in Section 5(d) hereof, of any change in the Company's
condition (financial or other), net worth, business, affairs, management,
prospects, results of operations or cash flow or of any change in
information relating to such Selling Shareholder or the Company or any new
information relating to the Company or relating to any matter stated in the
Prospectus or any amendment or supplement thereto which comes to the
attention of such Selling Shareholder that suggests that any statement made
in the Registration Statement or the Prospectus (as then amended or
supplemented, if amended or supplemented) is or may be untrue in any
material respect or that the Registration Statement or Prospectus (as then
amended or supplemented, if amended or supplemented) omits or may omit to
state a material fact or a fact necessary to be stated therein in order to
make the statements therein not misleading in any material respect, or of
the necessity to amend or supplement the Prospectus (as then amended or
supplemented, if amended or supplemented) in order to comply with the 1933
Act or any other law.
20
6. Conditions of Underwriters' Obligations. The several obligations
of the Underwriters to purchase and pay for the Shares, as provided herein,
shall be subject to the accuracy, as of the date hereof and as of the Closing
Date (and, if applicable, the Option Closing Date), of the representations and
warranties of the Company and the Selling Shareholders contained herein, to the
performance by the Company and the Selling Shareholders of their covenants and
obligations hereunder, and to the following additional conditions:
(a) The Registration Statement and all post-effective amendments
thereto shall have become effective not later than 1:00 p.m., St. Louis time, on
the date hereof, or, with your consent, at a later date and time, not later than
10:00 a.m., St. Louis time, on the first business day following the date hereof,
or at such later date and time as may be approved by the Representatives; if the
Company has elected to rely on Rule 462(b) under the 1933 Act, the Abbreviated
Registration Statement shall have become effective not later than the earlier
of (x) 10:00 p.m. St. Louis time, on the date hereof, or (y) at such later date
and time as may be approved by the Representatives. All filings required by
Rule 424 and Rule 430A of the 1933 Act Rules and Regulations shall have been
made. No stop order suspending the effectiveness of the Registration Statement,
as amended from time to time, shall have been issued and no proceeding for that
purpose shall have been initiated or, to the knowledge of the Company or any
Underwriter, threatened or contemplated by the SEC, and any request of the SEC
for additional information (to be included in the Registration Statement or the
Prospectus or otherwise) shall have been complied with to the reasonable
satisfaction of the Underwriters.
(b) No Underwriter shall have advised the Company on or prior to the
Closing Date (and, if applicable, the Option Closing Date), that the
Registration Statement or Prospectus or any amendment or supplement thereto
contains an untrue statement of fact which, in the opinion of counsel to 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 is necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading.
(c) On the Closing Date (and, if applicable, the Option Closing Date),
you shall have received the opinion of Steptoe & Xxxxxxx LLP, counsel for the
Company, addressed to you and dated the Closing Date (and, if applicable, the
Option Closing Date), to the effect that:
(i) The Registration Statement and all post-effective amendments
thereto and the Abbreviated Registration Statement, if any, have
become effective under the 1933 Act; any required filing of the
Prospectus or any supplement thereto pursuant to Rule 424(b) or
otherwise has been made in the manner and within the time period
required thereby; and, to the knowledge of such counsel after due
inquiry, no stop or other 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 or under the securities laws of any jurisdiction.
21
(ii) The Registration Statement and the Prospectus, and each
amendment or supplement thereto (including any document incorporated by
reference into the Prospectus), as of their respective effective or issue
date, comply as to form and appear on their face to be appropriately
responsive in all material respects to the requirements of Form S-3 under
the 1933 Act and the applicable 1933 Act Rules and Regulations (except that
such counsel need express no opinion as to the financial statements and the
notes and schedules related thereto, or other financial or statistical
data); the conditions for use of Form S-3 have been satisfied; and, as of
the date they were filed with the SEC, the documents incorporated by
reference in the Prospectus appear on their face to comply as to form and
be appropriately responsive in all material respects with the requirements
of the 1934 Act and the applicable 1934 Act Rules and Regulations (except
that such counsel need express no opinion as to the financial statements
and the notes and schedules related thereto, or other financial or
statistical data).
(iii) The descriptions in the Registration Statement and
Prospectus of statutes, laws, ordinances, rules, regulations, legal or
governmental proceedings, contracts and other documents are accurate and
fairly present the information required to be shown under the 1933 Act and
the 1933 Act Rules and Regulations.
(iv) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid and legally binding
obligation of the Company enforceable against the Company in accordance
with its terms except as enforceability may be limited by the Exceptions
and except to the extent the enforceability of the indemnification and
contribution provisions of Section 7 of the Agreement may be limited by
public policy considerations as expressed in the 1933 Act as construed by
courts of competent jurisdiction.
(v) The Company and its Active Subsidiaries have been duly
organized and are validly existing as corporations in good standing under
the laws of the states or other jurisdictions in which they are
incorporated, with full power and authority (corporate and other) to own,
lease and operate their properties and conduct their businesses as
described in the Prospectus and, with respect to the Company, to execute
and deliver, and perform the Company's obligations under, this Agreement;
the Company and its Active Subsidiaries are duly qualified to do business
as foreign corporations in good standing in each state or other
jurisdiction in which their ownership or leasing of property or conduct of
business legally requires such qualification, except where the failure to
be so qualified, individually or in the aggregate, would not have a
Material Adverse Effect.
(vi) The entities listed on Exhibit A are the only
subsidiaries, direct or indirect, of the Company. The Company owns,
directly or indirectly through other subsidiaries, the percentage indicated
on Exhibit A of the outstanding shares of capital stock or other securities
evidencing equity ownership of such subsidiaries, and all such securities
have been duly authorized and validly issued, are fully paid and non-
assessable and, to the
22
knowledge of such counsel, are owned by the Company free and clear of any
mortgage, pledge, lien, encumbrance, charge or adverse claim and are not
the subject of any agreement or understanding with any person, and were not
issued in violation of any preemptive or similar rights; and, to the
knowledge of such counsel, except as disclosed in the Prospectus, there are
no outstanding subscriptions, rights, warrants, options, calls, convertible
securities, commitments of sale, or instruments related to or entitling any
person to purchase or otherwise acquire any shares of, or any security
convertible into or exercisable or exchangeable for, any such shares of
capital stock or other ownership interest of any of such subsidiaries.
(vii) The issuance and sale of the Shares and the execution,
delivery and performance by the Company of this Agreement, and the
consummation of the transactions herein contemplated, will not conflict
with or result in a breach or violation of any of the terms or provisions
of, or constitute a default under, or result in the creation or imposition
of any lien, charge or encumbrance upon any properties or assets of the
Company or any of its Active Subsidiaries under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument known to
such counsel after due inquiry to which the Company or any of its Active
Subsidiaries is a party or by which the Company or any of its Active
Subsidiaries is bound or to which any of the properties or assets of the
Company or any of its Active Subsidiaries is subject, except to such extent
as, individually or in the aggregate, does not have a Material Adverse
Effect, nor will such action result in any violation of the provisions of
the Company's certificate of incorporation or bylaws or any statute, rule,
regulation or other law, or any order or judgment known to such counsel
after due inquiry, of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties.
(viii) No consent, approval, authorization, order, registration
or qualification of or with any court or governmental agency or body is
required in connection with the execution, delivery and performance of this
Agreement, and the issuance and sale of the Shares or the consummation of
the transactions contemplated hereby, except such as may be required under
the 1933 Act or the 1933 Act Rules and Regulations and have been obtained,
or as may be required by the NASD or under state securities laws in
connection with the purchase and distribution of the Shares by the
Underwriters. Each of the Company and its subsidiaries has filed all
Notices pursuant to, and has obtained all Approvals required to be obtained
under, and has otherwise complied with all requirements of, all applicable
laws and regulations in connection with the issuance and sale of the
Shares, in each case with such exceptions, individually or in the
aggregate, as would not affect the validity of the Shares, their issuance
or the transactions contemplated hereby or have a Material Adverse Effect;
and no such Notices or Approvals are required to be filed or obtained by
the Company or any of its subsidiaries in connection with the execution,
delivery and performance of this Agreement, the issuance and sale of the
Shares or the transactions contemplated hereby, in each case with such
exceptions,
23
individually or in the aggregate, as would not affect the validity of the
Shares, their issuance or the transactions contemplated hereby or have a
Material Adverse Effect.
(ix) To the knowledge of such counsel after due inquiry and other
than as set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is a
party or of which any property of the Company or any of its subsidiaries is
the subject that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a material
adverse effect on the current or future consolidated financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole; and, to the knowledge of such counsel after
due inquiry and other than as set forth in the Prospectus, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others.
(x) The Company has duly and validly authorized capital stock as set
forth under the caption "Capitalization" in the Prospectus; all outstanding
shares of Common Stock of the Company and the Shares conform, or when
issued will conform, as to legal matters to the description thereof in the
Prospectus and have been duly authorized, validly issued, fully paid and
non-assessable; and the Shares to be sold by the Company have been duly
authorized and, when delivered and paid for in accordance with this
Agreement, will be validly issued, fully paid and non-assessable. All
corporate action required to be taken by the Company for the authorization,
issue and sale of the Shares has been duly and validly taken. The Shares
are duly authorized for trading, subject to official notice of issuance and
evidence of satisfactory distribution, on the American Stock Exchange. The
form of specimen certificate representing the Shares incorporated by
reference as an exhibit to the Registration Statement is in valid and
sufficient form. The issuance of the Shares to be purchased from the
Company hereunder is not subject to preemptive or other similar rights, or
any restriction upon the voting or transfer thereof pursuant to applicable
law or the certificate of incorporation, bylaws or governing documents of
the Company or any agreement to which the Company or any of its
subsidiaries is a party or by which any of them may be bound; and, to such
counsel's knowledge, except as described in the Prospectus, there are no
outstanding subscriptions, rights, warrants, options, calls, convertible
securities, commitments of sale or rights related to or entitling any
person to purchase or otherwise acquire any shares of, or any security
convertible into or exercisable or exchangeable for, the capital stock of,
or other ownership interest in, the Company.
(xi) To the knowledge of such counsel after due inquiry, the Company
and each of its Active Subsidiaries hold all licenses, certificates,
permits and approvals from all state, federal and other regulatory
authorities, and have satisfied in all material respects the requirements
imposed by regulatory bodies, administrative agencies or other governmental
bodies, agencies or officials, that are required for the Company and its
Active Subsidiaries lawfully to own, lease and operate its properties and
conduct its
24
business as described in the Prospectus, and, to the knowledge of such
counsel after due inquiry, each of the Company and its Active Subsidiaries
is conducting its business in compliance in all material respects with all
of the laws, rules and regulations of each jurisdiction in which it
conducts its business.
(xii) The statements made in the Prospectus under the captions "Risk
Factors," "Dividend Policy," "Business," "Description of Credit Facility,"
and Item 15 of Part II of the Registration Statement, and in the Company's
Annual Report on Form 10-K of the year ended December 31, 1998 under Item
11, "Executive Compensation" and Item 13, "Certain Relationships and
Related Transactions," to the extent that they constitute summaries of
documents referred to therein or matters of law or legal conclusions, have
been reviewed by such counsel and are accurate summaries and fairly present
the information disclosed therein.
(xiii) Neither the Company nor any of its Active Subsidiaries is, or
with the giving of notice or lapse of time or both would be, in default or
violation with respect to its certificate of incorporation or by-laws. To
the knowledge of such counsel after due inquiry, neither the Company nor
any of its Active Subsidiaries is, or with the giving of notice or lapse
of time or both would be, in default in the performance or observance of
any material obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement, lease or other
agreement or instrument to which the Company or any of its Active
Subsidiaries is a party or by which the Company or any of its Active
Subsidiaries is bound or to which any of the properties or assets of the
Company or any of its Active Subsidiaries is subject. Neither the Company
nor any of its subsidiaries is in violation of any statutes, laws,
ordinances or governmental rules or regulations or any orders or decrees to
which it is subject, including, without limitation, Section 13 of the 1934
Act, and neither the Company nor any of its subsidiaries has failed to
obtain any other license, permit, franchise, easement, consent, or other
governmental authorization necessary to the ownership, leasing and
operation of its properties or to the conduct of its business, which
default, violation or failure, individually or in the aggregate, would have
a Material Adverse Effect.
(xiv) To the knowledge of such counsel after due inquiry, (A) there
are no material (individually, or in the aggregate) legal, governmental or
regulatory proceedings pending or threatened to which the Company or any of
its subsidiaries is a party or of which the business or properties of the
Company or any of its subsidiaries is the subject which are not disclosed
in the Registration Statement and Prospectus, (B) there are no contracts or
documents 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 are not described or filed as required, and
(C) there are no statutes, ordinances, laws, rules or regulations required
to be described in the Registration Statement or Prospectus which are not
described as required.
25
(xv) The Company is not and, after giving effect to the offering
and sale of the Shares, will not be a "holding company," or a "subsidiary
company" of a "holding company," or an "affiliate" of a "holding company"
or of a "subsidiary company," as such terms are defined in the 0000 Xxx.
(xvi) The Company is not and, after giving effect to the offering
and sale of the Shares, will not be an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the
0000 Xxx.
(xvii) All the shares of capital stock of the Company issued since
January 1, 1997 were issued and sold by the Company in compliance with all
applicable federal and state securities laws.
(xviii) To the knowledge of such counsel after due inquiry and except
as disclosed in the Prospectus, no holder of any security of the Company
has any right to require registration of shares of Common Stock or any
other security of the Company because of the filing of the Registration
Statement or the consummation of the transactions contemplated hereby and,
except as disclosed in the Prospectus, no person has the right to require
registration under the 1933 Act of any shares of Common Stock or other
securities of the Company.
Such counsel shall confirm that during the preparation of the Registration
Statement and Prospectus, such counsel participated in conferences with the
Representatives and their counsel and with officers and representatives of the
Company and its independent accountants, at which conferences the contents of
the Registration Statement and the Prospectus (including all documents filed
under the 1934 Act and deemed incorporated by reference therein) were discussed,
reviewed and revised. On the basis of the information which was developed in
the course thereof, considered in light of such counsel's understanding of
applicable law and the experience gained by such counsel through their practice
thereunder, without such counsel assuming responsibility for the accuracy and
completeness of such statements except to the extent expressly provided above,
such counsel shall confirm that nothing came to their attention that would lead
them to believe that either the Registration Statement (including any document
filed under the 1934 Act and deemed incorporated by reference therein), as of
the Effective Date, contained an untrue statement of a material fact or omitted
to state a 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 the Prospectus or any amendment or supplement thereto
(including any document filed under the 1934 Act and deemed incorporated by
reference therein) as of its respective issue date and as of the Closing Date,
or, if applicable, the Option Closing Date, contained or contains any untrue
statement of a material fact or omitted or omits to state a 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 (other
than the financial statements or other financial data as to which such counsel
need express no opinion).
26
In rendering the foregoing opinion, such counsel may rely, (1) as to
matters involving laws of any jurisdiction other than New York or the United
States, upon opinions addressed to the Underwriters of other counsel
satisfactory to them and Xxxxx Xxxx LLP, and (2) as to all matters of fact, upon
certificates and written statements of the executive officers of, and
accountants for, the Company, provided, in either case, that such counsel shall
state in their opinion that they and the Underwriters are justified in relying
thereon.
(d) On the Option Closing Date, if applicable, you shall have received the
opinion of ____________________, counsel to the Selling Shareholders, addressed
to you and dated the Option Closing Date, to the effect that:
(i) The Custody Agreement and Power of Attorney has been duly
executed and delivered by such Selling Shareholders and constitutes a
legal, valid and binding agreement of such Selling Shareholders enforceable
in accordance with its terms.
(ii) This Agreement has been duly authorized, executed and delivered
on behalf of the Selling Shareholders, and is a legal, valid and binding
obligation of the Selling Shareholders. The execution and delivery of this
Agreement and the Custody Agreement and Power of Attorney by such Selling
Shareholders, the consummation by such Selling Shareholders of the
transactions contemplated herein and therein and the fulfillment by such
Selling Shareholders of the terms hereof and thereof will not result in a
breach or violation of any terms or provisions of, or constitute a default
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any of the properties or assets of such Selling
Shareholders under any bond, debenture, note or other evidence of
indebtedness or any indenture, mortgage, deed of trust, sale and leaseback
arrangement, joint venture or any other agreement or instrument to which
any such Selling Shareholder is a party, or by which it is bound or to
which any of the properties or assets of any such Selling Shareholder is
subject (or any certificate or articles of incorporation or bylaws,
partnership agreement, trust document or articles of association of any
such Selling Shareholder, as applicable), or any order or decree, or
statute, law, ordinance, rule or regulation applicable to any such Selling
Shareholder of any court or of any governmental agency, authority or body
having jurisdiction over any such Selling Shareholder or its properties.
(iii) Each Selling Shareholder has full legal right, power and
authority, and any approval required by law (other than as required by the
1933 Act, the NASD and state securities laws) to sell, assign, transfer and
deliver the Shares to be sold by such Selling Shareholder.
(iv) No consent, approval, authorization or order of any court, or
governmental agency or body is required for consummation of the
transactions contemplated by this Agreement in connection with the Shares
to be sold by each Selling Shareholder
27
hereunder except such as may be required under the 1933 Act or the 1933 Act
Rules and Regulations or as may be required by the NASD or under state
securities laws.
(v) Each Selling Shareholder has good, valid and marketable title to
the Shares being sold by such Selling Shareholder hereunder, free and clear
of all liens, mortgages, pledges, encumbrances, claims, equities and
security interests whatsoever, including any restriction on transfer other
than pursuant to this Agreement and the Custody Agreement and Power of
Attorney, and has transferred to the Underwriters good, valid and
marketable title to the Shares being sold by such Selling Shareholder on
the Option Closing Date, free and clear of all liens, mortgages, pledges,
encumbrances, claims, equities and security interests whatsoever, including
any restriction or transfer other than pursuant to this Agreement and the
Custody Agreement and Power of Attorney.
In rendering the foregoing opinion, such counsel may rely, (1) as to
matters involving laws of any jurisdiction other than New York or the United
States, upon opinions addressed to the Underwriters of other counsel
satisfactory to them and Xxxxx Xxxx LLP, and (2) as to all matters of fact, upon
certificates and written statements of the Selling Shareholders, provided, in
either case, that such counsel shall state in their opinion that they and the
Underwriters are justified in relying thereon.
(e) You shall have received on the Closing Date (and, if applicable, the
Option Closing Date), from Xxxxx Xxxx, LLP, counsel to the Underwriters, such
opinion or opinions, dated the Closing Date (and, if applicable, the Option
Closing Date) with respect to such matters as you may reasonably require; and
the Company shall have furnished to such counsel such documents as they
reasonably request for the purposes of enabling them to review or pass on the
matters referred to in this Section 6 and in order to evidence the accuracy,
completeness and satisfaction of the representations, warranties and conditions
herein contained.
(f) You shall have received at or prior to the Closing Date from Xxxxx Xxxx
LLP a memorandum or memoranda, in form and substance satisfactory to you, with
respect to the qualification for offering and sale by the Underwriters of the
Shares under state securities laws of such jurisdictions as the Underwriters may
have designated to the Company.
(g) On the business day immediately preceding the date of this Agreement
and on the Closing Date (and, if applicable, the Option Closing Date), you shall
have received from each of KPMG LLP and Ernst & Young LLP, a letter or letters,
dated the date of this Agreement and the Closing Date (and, if applicable, the
Option Closing Date), respectively, in form and substance satisfactory to you,
confirming that they are independent public accountants with respect to the
Company within the meaning of the 1933 Act and the published Rules and
Regulations, and stating to the effect set forth in Schedule III hereto.
28
(h) Except as contemplated in the Prospectus, (i) neither the Company nor
any of its Active Subsidiaries shall have sustained since the date of the latest
audited financial statements included or incorporated by reference in the
Prospectus any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree; and (ii) subsequent to
the respective dates as of which information is given in the Registration
Statement and the Prospectus, neither the Company nor any of its subsidiaries
shall have incurred any liability or obligation, direct or contingent, or
entered into any transactions, and there shall not have been any change in the
capital stock or short-term or long-term debt of the Company and its
subsidiaries or any change, or any development involving or which might
reasonably be expected to involve a prospective change in the condition
(financial or other), net worth, business, affairs, management, prospects,
results of operations or cash flow of the Company or its subsidiaries, the
effect of which, in any such case described in clause (i) or (ii), is in your
reasonable judgment so material or adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the Shares
being delivered on such Closing Date (and, if applicable, the Option Closing
Date) on the terms and in the manner contemplated in the Prospectus.
(i) There shall not have occurred any of the following: (i) a suspension
or material limitation in trading in securities generally on the New York Stock
Exchange or the American Stock Exchange or The Nasdaq National Market or the
establishing on such exchanges or market by the SEC or by such exchanges or
markets of minimum or maximum prices which are not in force and effect on the
date hereof; (ii) a suspension or material limitation in trading in the
Company's securities on the American Stock Exchange or the establishing on such
exchange by the SEC or by such exchange of minimum or maximum prices which are
not in force and effect on the date hereof; (iii) a general moratorium on
commercial banking activities declared by either federal or any state
authorities; (iv) the outbreak or escalation of hostilities involving the United
States or the declaration by the United States of a national emergency or war,
which in your judgment makes it impracticable or inadvisable to proceed with the
public offering or the delivery of the Shares in the manner contemplated in the
Prospectus; or (v) any calamity or crisis, change in national, international or
world affairs, act of God, change in the international or domestic markets, or
change in the existing financial, political or economic conditions in the United
States or elsewhere, which in your judgment makes it impracticable or
inadvisable to proceed with the public offering or the delivery of the Shares in
the manner contemplated in the Prospectus.
(j) You shall have received certificates, dated the Closing Date (and, if
applicable, the Option Closing Date) and signed by the President and Chief
Executive Officer and by the Chief Financial Officer of the Company, in their
capacities as such, stating that:
(i) the condition set forth in Section 6(a) has been fully satisfied;
(ii) they have carefully examined the Registration Statement and the
Prospectus as amended or supplemented and all documents incorporated by
reference
29
therein and nothing has come to their attention that would lead them to
believe that either the Registration Statement or the Prospectus, or any
amendment or supplement thereto or any documents incorporated by reference
therein as of their respective effective, issue or filing dates, contained,
and the Prospectus as amended or supplemented and all documents
incorporated by reference therein when read together with the documents
incorporated by reference therein, at such Closing Date, contains any
untrue statement of a material fact, or omits to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading;
(iii) since the Effective Date, there has occurred no event required
to be set forth in an amendment or supplement to the Registration Statement
or the Prospectus which has not been so set forth and there has been no
document required to be filed under the 1934 Act and the 1934 Act Rules and
Regulations that upon such filing would be deemed to be incorporated by
reference into the Prospectus that has not been so filed;
(iv) all representations and warranties made herein by the Company are
true and correct at such Closing Date, with the same effect as if made on
and as of such Closing Date, and all agreements herein to be performed or
complied with by the Company on or prior to such Closing Date have been
duly performed and complied with by the Company;
(v) neither the Company nor any of its Active Subsidiaries has
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus any material loss
or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree;
(vi) except as disclosed in the Prospectus, subsequent to the
respective dates as of which information is given in the Registration
Statement and the Prospectus, neither the Company nor any of its
subsidiaries has incurred any liabilities or obligations, direct or
contingent, other than in the ordinary course of business, or entered into
any transactions not in the ordinary course of business, which in either
case are material to the Company or such subsidiary; and there has not been
any change in the capital stock or material increase in the short-term debt
or long-term debt of the Company or any of its subsidiaries or any material
adverse change or any development involving or which may reasonably be
expected to involve a prospective material adverse change, in the condition
(financial or other), net worth, business, affairs, management, prospects,
results of operations or cash flow of the Company and its subsidiaries
taken as a whole; and there has been no dividend or distribution of any
kind, paid or made by the Company on any class of its capital stock;
30
(vii) there has not been any change or decrease specified in
paragraph 5(b) of the letter or letters delivered to the Underwriters
referred to in Section 6(g) above, except those changes and decreases that
are disclosed therein; and
(viii) covering such other matters as you may reasonably request.
(k) You shall have received certificates, dated the Option Closing Date, if
applicable, signed by each of the Selling Shareholders, stating that (i) all
representations and warranties made herein by such Selling Shareholder are true
and correct at the Option Closing Date, with the same effect as if made on and
as of such Closing Date, and all agreements herein to be performed or complied
with by such Selling Shareholder on or prior to such Closing Date have been duly
performed or complied with by such Selling Shareholder and (ii) covering such
other matters as you may reasonably request.
(l) The Company and the Selling Shareholders shall not have failed,
refused, or been unable, at or prior to the Closing Date (and, if applicable,
the Option Closing Date) to have performed any agreement on their part to be
performed or any of the conditions herein contained and required to be performed
or satisfied by them at or prior to such Closing Date.
(m) The Company and the Selling Shareholders shall have furnished to you at
the Closing Date (and, if applicable, the Option Closing Date) such further
information, opinions, certificates, letters and documents as you may have
reasonably requested.
(n) The Shares shall have been approved for trading upon official notice of
issuance on the American Stock Exchange.
(o) You shall have received duly and validly executed letter agreements
referred to in Section 5(o) hereof.
All such opinions, certificates, letters and documents will be in
compliance with the provisions hereof only if they are satisfactory in form and
substance to you and to Xxxxx Xxxx LLP, counsel for the several Underwriters.
The Company and the Selling Shareholders will furnish you with such signed and
conformed copies of such opinions, certificates, letters and documents as you
may request.
If any of the conditions specified above in this Section 6 shall not have
been satisfied at or prior to the Closing Date (and, if applicable, the Option
Closing Date) or waived by you in writing, this Agreement may be terminated by
you on notice to the Company and the Selling Shareholders.
7. Indemnification and Contribution. (a) The Company will indemnify and
hold harmless each Underwriter for and against any losses, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the 1933 Act or otherwise, insofar as such
31
losses, damages or liabilities (or actions or claims in respect thereof) arise
out of or are based upon (i) an untrue statement or alleged untrue statement of
a material fact contained in any Preliminary Prospectus, the Registration
Statement, the Prospectus or any other prospectus relating to the Shares, or any
amendment or supplement thereto, or in any blue sky application or other
document executed by the Company or based on any information furnished in
writing by the Company, filed in any state or other jurisdiction in order to
qualify any or all of the Shares under the securities laws thereof (the "Blue
Sky Application"), or (ii) 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 for any legal or
other expenses incurred by such Underwriter in connection with investigating,
preparing, pursuing or defending against or appearing as a third party witness
in connection with any such loss, damage, liability or action or claim,
including, without limitation, any investigation or proceeding by any
governmental agency or body, commenced or threatened, including the reasonable
fees and expenses of counsel to the indemnified party, as such expenses are
incurred (including such losses, damages, liabilities or expenses to the extent
of the aggregate amount paid in settlement of any such action or claim, provided
that (subject to Section 7(d) hereof) any such settlement is effected with the
written consent of the Company); provided, however, that the Company and the
Selling Shareholders shall not be liable in any such case to the extent, but
only to the extent, that any such loss, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in any Preliminary Prospectus, the Registration Statement,
the Prospectus or any other prospectus relating to the Shares, or any such
amendment or supplement, in reliance upon and in conformity with written
information relating to the Underwriter furnished to the Company by you or by
any Underwriter through you, expressly for use in the preparation thereof (as
provided in Section 14 hereof); and provided further, that the liability of a
Selling Shareholder pursuant to this Section 7(a) shall not exceed the product
of the number of Shares sold by such Selling Shareholder and the public offering
prices per share of the Shares set forth in the Prospectus.
(b) Each Selling Shareholder will indemnify and hold harmless each
Underwriter for and against any losses, damages or liabilities to which such
Underwriter may become subject, under the 1933 Act or otherwise, insofar as such
losses, damages or liabilities (or actions or claims in respect thereof) arise
out of or are based upon (i) an untrue statement or alleged untrue statement of
a material fact contained in any Preliminary Prospectus, the Registration
Statement, the Prospectus or any other prospectus relating to the Shares, or any
amendment or supplement thereto, or any Blue Sky Application, or (ii) 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 any
Preliminary Prospectus, the Registration Statement, the Prospectus or any other
prospectus relating to the Shares, or any such amendment or supplement, or any
Blue Sky Application, in reliance upon and in conformity with written
information furnished to the Company or any Underwriter by such Selling
Shareholder specifically for use in the preparation thereof, and will reimburse
each Underwriter for any legal or other expenses incurred by such Underwriter in
connection with
32
investigating, preparing, pursuing or defending against or appearing as a third
party witness in connection with any such loss, damage, liability or action or
claim, including, without limitation, any investigation or proceeding by any
governmental agency or body, commenced or threatened, including the reasonable
fees and expenses of counsel to the indemnified party, as such expenses are
incurred (including such losses, damages, liabilities or expenses to the extent
of the aggregate amount paid in settlement of any such action or claim, provided
that (subject to Section 7(d) hereof) any such settlement is effected with the
written consent of such Selling Shareholder).
(c) Each Underwriter, severally and not jointly, will indemnify and hold
harmless the Company and each Selling Shareholder for and against any losses,
damages or liabilities to which the Company may become subject, under the 1933
Act or otherwise, insofar as such losses, damages or liabilities (or actions or
claims in respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Prospectus, the Registration Statement, the Prospectus or any other prospectus
relating to the Shares, or any amendment or supplement thereto, or any Blue Sky
Application, 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 any Preliminary Prospectus, the
Registration Statement, the Prospectus or any other prospectus relating to the
Shares, or any such amendment or supplement, or any Blue Sky Application, in
reliance upon and in conformity with written information relating to the
Underwriter furnished to the Company by you or by any Underwriter through you,
expressly for use in the preparation thereof (as provided in Section 14 hereof),
and will reimburse the Company or any such Selling Shareholder for any legal or
other expenses incurred by the Company or any such Selling Shareholder, as the
case may be, in connection with investigating or defending any such action or
claim as such expenses are incurred (including such losses, damages, liabilities
or expenses to the extent of the aggregate amount paid in settlement of any such
action or claim, provided that (subject to Section 7(d) hereof) any such
settlement is effected with the written consent of the Underwriters).
(d) Promptly after receipt by an indemnified party under Section 7(a), 7(b)
or 7(c) hereof of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against an indemnifying
party under Section 7(a), 7(b) or 7(c) hereof, notify each such indemnifying
party in writing of the commencement thereof, but the failure so to notify such
indemnifying party shall not relieve such indemnifying party from any liability
except to the extent that it has been prejudiced in any material respect by such
failure or from any liability that it may have to any such indemnified party
otherwise than under Section 7(a), 7(b) or 7(c) hereof. In case any such action
shall be brought against any such indemnified party and it shall notify each
indemnifying party of the commencement thereof, each such indemnifying party
shall be entitled to participate therein and, to the extent that it shall wish,
jointly with any other indemnifying party under Section 7(a), 7(b) or 7(c)
hereof similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except with the consent
of such indemnified party, be counsel to such indemnifying
33
party), and, after notice from such indemnifying party to such indemnified
party of its election so to assume the defense thereof, such indemnifying party
shall not be liable to such indemnified party under Section 7(a), 7(b) or 7(c)
hereof for any legal expenses of other counsel or any other expenses, in each
case subsequently incurred by such indemnified party, in connection with the
defense thereof other than reasonable costs of investigation. The indemnified
party shall have the right to employ its own counsel in any such action, but the
fees and expenses of such counsel shall be at the expense of such indemnified
party unless (i) the employment of counsel by such indemnified party at the
expense of the indemnifying party has been authorized by the indemnifying party,
(ii) the indemnified party shall have been advised by such counsel that there
may be a conflict of interest between the indemnifying party and the indemnified
party in the conduct of the defense, or certain aspects of the defense, of such
action (in which case the indemnifying party shall not have the right to direct
the defense of such action with respect to those matters or aspects of the
defense on which a conflict exists or may exist on behalf of the indemnified
party) or (iii) the indemnifying party shall not in fact have employed counsel
reasonably satisfactory to such indemnified party to assume the defense of such
action, in any of which events such fees and expenses to the extent applicable
shall be borne, and shall be paid as incurred, by the indemnifying party. If at
any time such indemnified party shall have requested such indemnifying party
under Section 7(a), 7(b) or 7(c) hereof to reimburse such indemnified party for
fees and expenses of counsel, such indemnifying party agrees that it shall be
liable for any settlement of the nature contemplated by Section 7(a), 7(b) or
7(c) hereof effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of such
request for reimbursement, (ii) such indemnifying party shall have received
notice of the terms of such settlement at least 30 days prior to such settlement
being entered into and (iii) such indemnifying party shall not have reimbursed
such indemnified party in accordance with such request for reimbursement prior
to the date of such settlement. No such indemnifying party shall, without the
written consent of such indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder (whether or not such indemnified party is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (A) includes an unconditional release of such indemnified party from
all liability arising out of such action or claim and (B) does not include a
statement as to or an admission of fault, culpability or a failure to act, by or
on behalf of any such indemnified party. In no event shall such indemnifying
parties be liable for the fees and expenses of more than one counsel, including
any local counsel, for all such indemnified parties in connection with any one
action or separate but similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances.
(e) If the indemnification provided for in this Section 7 is unavailable to
or insufficient to indemnify or hold harmless an indemnified party under Section
7(a), 7(b) or 7(c) hereof in respect of any losses, damages or liabilities (or
actions or claims in respect thereof) referred to therein, then each
indemnifying party under Section 7(a), 7(b) or 7(c) hereof shall contribute to
the amount paid or payable by such indemnified party as a result of such losses,
damages or liabilities (or actions or claims in respect thereof) in such
proportion as is appropriate
34
to reflect the relative benefits received by the Company and the Selling
Shareholders, on the one hand, and the Underwriters, on the other hand, from the
offering of the Shares. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the indemnified
party failed to give the notice required under Section 7(d) hereof and such
indemnifying party was prejudiced in a material respect by such failure, then
each such indemnifying party shall contribute to such amount paid or payable by
such indemnified party in such proportion as is appropriate to reflect not only
such relative benefits but also the relative fault, as applicable, of the
Company and the Selling Shareholders, on the one hand, and the Underwriters, on
the other hand, in connection with the statements or omissions that resulted in
such losses, damages or liabilities (or actions or claims in respect thereof),
as well as any other relevant equitable considerations. The relative benefits
received by, as applicable, the Company and the Selling Shareholders, on the one
hand, and the Underwriters, on the other hand, shall be deemed to be in the same
proportion as the total net proceeds from such offering (before deducting
expenses) received by the Company and the Selling Shareholders bear to the total
underwriting discounts and commissions received by the Underwriters. The
relative fault, as applicable, of the Company or the Selling Shareholders, on
the one hand, and the Underwriters, on the other hand, shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the Selling Shareholders, on
the one hand, or the Underwriters, on the other hand, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company, the Selling Shareholders and the
Underwriters agree that it would not be just and equitable if contribution
pursuant to this Section 7(e) were determined by pro rata allocation (even if
the Underwriters were treated as one entity for such purpose) or by any other
method of allocation that does not take account of the equitable considerations
referred to above in this Section 7(e). The amount paid or payable by such an
indemnified party as a result of the losses, damages or liabilities (or actions
or claims in respect thereof) referred to above in this Section 7(e) shall be
deemed to include any legal or other expenses incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7(e), 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 that 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 obligations of the Underwriters in this Section 7(e) to
contribute are several in proportion to their respective underwriting
obligations with respect to the Shares and not joint.
(f) The obligations of the Company and the Selling Shareholders under this
Section 7 shall be in addition to any liability that the Company and the Selling
Shareholders may otherwise have and shall extend, upon the same terms and
conditions, to each officer, director, employee, agent or other representative
and to each person, if any, who controls any Underwriter within the
35
meaning of the 1933 Act; and the obligations of the Underwriters under this
Section 7 shall be in addition to any liability that the respective Underwriters
may otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Company who signed the Registration Statement and to
each person, if any, who controls the Company within the meaning of the 1933 Act
and to each person, if any, who controls the Selling Shareholders within the
meaning of the 1933 Act.
(g) The parties to this Agreement hereby acknowledge that they are
sophisticated business persons who were represented by counsel during the
negotiations regarding the provisions hereof, including, without limitation, the
provisions of this Section 7, and are fully informed regarding such provisions.
They further acknowledge that the provisions of this Section 7 fairly allocate
the risks in light of the ability of the parties to investigate the Company and
its business in order to assure that adequate disclosure is made in the
Registration Statement, any Preliminary Prospectus, the Prospectus, and any
supplement or amendment thereof, as required by the 1933 Act.
8. Representations and Agreements to Survive Delivery. The respective
representations, warranties, agreements and statements of the Company, the
Selling Shareholders and the Underwriters, as set forth in this Agreement or
made by or on behalf of them, respectively, pursuant to this Agreement, shall
remain operative and in full force and effect regardless of any investigation
(or any statement as to the results thereof) made by or on behalf of any
Underwriter or any controlling person of any Underwriter, the Company or any of
its officers, directors or any controlling persons or the Selling Shareholders,
and shall survive delivery of and payment for the Shares hereunder.
9. Substitution of Underwriters. (a) If any Underwriter shall default in
its obligation to purchase the Shares which it has agreed to purchase hereunder,
you may in your discretion arrange for you or another party or other parties to
purchase such Shares on the terms contained herein. If within thirty-six (36)
hours after such default by any Underwriter you do not arrange for the purchase
of such Shares, then the Company and the Selling Shareholders shall be entitled
to a further period of thirty-six (36) hours within which to procure another
party or parties reasonably satisfactory to you to purchase such Shares on such
terms. In the event that, within the respective prescribed periods, you notify
the Company and the Selling Shareholders that you have so arranged for the
purchase of such Shares, or the Company and the Selling Shareholders notify you
that they have so arranged for the purchase of such Shares, you or the Company
and the Selling Shareholders shall have the right to postpone the Closing Date
for a period of not more than seven days, in order to effect whatever changes
may thereby be made necessary in the Registration Statement or the Prospectus,
or in any other documents or arrangements, and the Company agrees to file
promptly any amendments to the Registration Statement or the Prospectus which in
your opinion may thereby be made necessary. The term "Underwriter" as used in
this Agreement shall include any persons substituted under this Section 9 with
like effect as if such person had originally been a party to this Agreement with
respect to such Shares.
36
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters made by you and the Company
and the Selling Shareholders as provided in subsection (a) above, the aggregate
number of Shares which remains unpurchased does not exceed one-eleventh of the
total Shares to be sold on the Closing Date, then the Company and the Selling
Shareholders shall have the right to require each non-defaulting Underwriter to
purchase the Shares which such Underwriter agreed to purchase hereunder and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Shares which such Underwriter agreed to purchase
hereunder) of the Shares of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters made by you and the Company
and the Selling Shareholders as provided in subsection (a) above, the number of
Shares which remains unpurchased exceeds one-eleventh of the total Shares to be
sold on the Closing Date, or if the Company and the Selling Shareholders shall
not exercise the right described in subsection (b) above to require the non-
defaulting Underwriters to purchase Shares of the defaulting Underwriter or
Underwriters, then this Agreement (or, with respect to the Option Closing Date,
the obligations of the Underwriters to purchase and of the Company and the
Selling Shareholders to sell the Option Shares) shall thereupon terminate,
without liability on the part of any non-defaulting Underwriter or the Company
and the Selling Shareholders except for the expenses to be borne by the Company
and the Selling Shareholders and the Underwriters as provided in Section 11
hereof and the indemnity and contribution agreements in Section 7 hereof; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
10. Effective Date and Termination. (a) This Agreement shall become
effective at 1:00 p.m., St. Louis time, on the first business day following the
effective date of the Registration Statement, or at such earlier time after the
effective date of the Registration Statement as you in your discretion shall
first release the Shares for offering to the public; provided, however, that the
provisions of Section 7 and 11 shall at all times be effective. For the
purposes of this Section 10(a), the Shares shall be deemed to have been released
to the public upon release by you of the publication of a newspaper
advertisement relating to the Shares or upon release of telegrams, facsimile
transmissions or letters offering the Shares for sale to securities dealers,
whichever shall first occur.
(b) This Agreement may be terminated by you at any time before it becomes
effective in accordance with Section 10(a) by notice to the Company and the
Selling Shareholders; provided, however, that the provisions of this Section 10
and of Section 7 and Section 11 hereof shall at all times be effective. In the
event of any termination of this Agreement pursuant to Section 9 or this Section
10(b) hereof, the Company and the Selling Shareholders shall not then be under
any liability to any Underwriter except as provided in Section 7 or Section 11
hereof.
37
(c) This Agreement may be terminated by you at any time at or prior to the
Closing Date by notice to the Company and the Selling Shareholders if any
condition specified in Section 6 hereof shall not have been satisfied on or
prior to the Closing Date. Any such termination shall be without liability of
any party to any other party except as provided in Sections 7 and 11 hereof.
(d) This Agreement also may be terminated by you, by notice to the Company
and the Selling Shareholders, as to any obligation of the Underwriters to
purchase the Option Shares, if any condition specified in Section 6 hereof shall
not have been satisfied at or prior to the Option Closing Date or as provided in
Section 9 of this Agreement.
If you terminate this Agreement as provided in Sections 10(b), 10(c) or
10(d), you shall notify the Company and the Selling Shareholders by telephone or
telegram, confirmed by letter.
11. Costs and Expenses. The Company, whether or not the transactions
contemplated hereby are consummated or this Agreement is prevented from becoming
effective under Section 10 hereof or is terminated, will bear and pay the costs
and expenses incident to the registration of the Shares and public offering
thereof, including, without limitation, (a) all expenses (including stock
transfer taxes) incurred in connection with the delivery to the several
Underwriters of the Shares, the filing fees of the SEC, the fees and expenses of
the Company's counsel and accountants, (b) the preparation, printing, filing,
delivery and shipping of the Registration Statement, each Preliminary
Prospectus, the Prospectus and any amendments or supplements thereto (except as
otherwise expressly provided in Section 5(d) hereof) and the printing, delivery
and shipping of this Agreement and other underwriting documents, including the
Agreement Among Underwriters, the Selected Dealer Agreement, Underwriters'
Questionnaires and Powers of Attorney and memoranda setting forth certain
information concerning the provisions of the securities laws of certain
jurisdictions of the United States and the District of Columbia with respect to
the proposed offering and sale of the Shares (the "Blue Sky Memoranda"), and any
instruments or documents related to any of the foregoing, (c) the furnishing of
copies of such documents (except as otherwise expressly provided in Section 5(d)
hereof) to the Underwriters, (d) the registration or qualification of the Shares
for offering and sale under the securities laws of the various states and other
jurisdictions, including the fees and disbursements of counsel to the
Underwriters relating to such registration or qualification and in connection
with preparing any Blue Sky Memoranda or related analysis, (e) the filing fees
of the NASD (if any) and fees and disbursements of counsel to the Underwriters
relating to any review of the offering by the NASD, (f) all printing and
engraving costs related to preparation of the certificates for the Shares,
including transfer agent and registrar fees, (g) all fees and expenses relating
to the authorization of the Shares for trading on the American Stock Exchange,
(h) all travel expenses, including air fare and accommodation expenses, of
representatives of the Company in connection with the offering of the Shares,
and (i) all of the other costs and expenses incident to the performance by the
Company of the registration and offering of the Shares; provided however, that
the Company, whether or not the transactions contemplated hereby are consummated
or this Agreement is prevented from becoming effective under Section 10 hereof
38
or is terminated, will pay or cause to be paid all costs and expenses incident
to the performance of each Selling Shareholder's obligations hereunder which are
not otherwise specifically provided for in this Section; including (x) any fees
and expenses of counsel for such Selling Shareholder, (y) such Selling
Shareholder's pro rata share of the fees and expenses of the Attorneys-in-Fact
and the Custodian, and (z) all expenses (including stock transfer taxes)
incident to the sale and delivery of the Shares to be sold by such Selling
Shareholder to the Underwriters hereunder; and provided further, that the
Underwriters will bear and pay the fees and expenses of the Underwriters'
counsel (except as provided in this Section 11), the Underwriters' out-of-pocket
expenses, and any advertising costs and expenses incurred by the Underwriters
incident to the public offering of the Shares.
If this Agreement is terminated by you in accordance with the provisions of
Section 10(c), the Company shall reimburse the Underwriters for all of their
out-of-pocket expenses, including the fees and disbursements of counsel to the
Underwriters.
12. Default of Selling Shareholders. Failure or refusal by any of the
Selling Shareholders to sell and deliver on the Closing Date the Shares agreed
to be sold and delivered by such Selling Shareholder shall in no manner relieve
the other Selling Shareholders or the Company of their respective obligations
under this Agreement. If any Selling Shareholder should fail or refuse to sell
and deliver his Shares, the remaining Selling Shareholders shall have the right
hereby granted to increase, pro rata or otherwise, the number of Shares to be
sold by them hereunder to the total number of shares to be sold by all Selling
Shareholders as set forth in Schedule I. If the remaining Selling Shareholders
do not fully exercise the right to increase the number of Shares to be sold by
them, the Underwriters, at your option, will have the right to elect to purchase
or not to purchase the Shares to be sold by the Company and the remaining
Selling Shareholders. In the event the Underwriters purchase the Shares of the
Company and such other Selling Shareholders pursuant to this Section 12, the
Closing Date shall be postponed for a period of not more than seven days in
order that the Registration Statement and Prospectus or other documents may be
amended or supplemented to the extent necessary under the provisions of the 1933
Act and the 1933 Act Rules and Regulations or under the securities laws of any
jurisdiction. If the Underwriters determine not to purchase the Shares of the
Company and the other Selling Shareholders, if any, this Agreement shall
terminate and neither the Company nor the Underwriters nor any other Selling
Shareholder shall be under any obligation under this Agreement except as
provided in Section 7 hereof and except for the obligation of the Company to pay
for such expenses as are set forth in Section 11 hereof. Nothing herein shall
relieve a defaulting Selling Shareholder from liability for his default or from
liability under Section 7 hereof or for expenses imposed by this Agreement upon
such Selling Shareholder.
13. Notices. All notices or communications hereunder, except as herein
otherwise specifically provided, shall be in writing and if sent to the
Underwriters shall be mailed, delivered, sent by facsimile transmission, or
telegraphed and confirmed c/o X.X. Xxxxxxx & Sons, Inc. at Xxx Xxxxx Xxxxxxxxx
Xxxxxx, Xx. Xxxxx, Xxxxxxxx 00000, Attention: Xxxx X. Xxxxxxx, Director of
Corporate Finance, facsimile number (000) 000-0000, with copies to Xxxxxx
Xxxxxx,
39
Senior Vice President, facsimile number (000) 000-0000 and Xxxxxxx X. Xxxxx,
Director of Law & Compliance, facsimile number (000) 000-0000, or if sent to the
Company shall be mailed, delivered, sent by facsimile transmission, or
telegraphed and confirmed to the Company at Xxxxxx Xxxxxx, Inc., 000 Xxxxx Xxxx
Xxxx, Xxxxxxx Xxxxx, Xxx Xxxxxx 00000, Attention: General Counsel, facsimile
number (000) 000-0000, or if sent to any Selling Shareholder shall be mailed,
delivered, sent by facsimile transmission or telegraphed and confirmed to such
Selling Shareholder, c/o the Attorney-in-Fact at the Company's address. Notice
to any Underwriter pursuant to Section 7 shall be mailed, delivered, sent by
facsimile transmission, or telegraphed and confirmed to such Underwriter's
address as it appears in the Underwriters' Questionnaire furnished in connection
with the offering of the Shares or as otherwise furnished to the Company and the
Selling Shareholders.
14. Information Furnished by Underwriters. The statements set forth in
(i) the cover page of the Prospectus with respect to delivery of the shares to
purchasers and (ii) the statements in the first, third, eighth, ninth, tenth and
twelfth paragraphs under the caption "Underwriting" in the Prospectus constitute
the only information furnished by or on behalf of the Underwriters through you
as such information is referred to in Section 4(a)(ii) and Section 7 hereof.
15. Parties. This Agreement shall inure to the benefit of and be binding
upon the Underwriters, the Company, the Selling Shareholders and, to the extent
provided in Sections 7 and 8, the officers and directors of the Company and each
person who controls the Company, any Selling Shareholder or any Underwriter and
their respective heirs, executors, administrators, successors and assigns.
Nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any person, corporation or other entity any legal or equitable
right, remedy or claim under or in respect of this Agreement or any provision
herein contained; this Agreement and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of the parties
hereto and their respective successors and assigns and said controlling persons
and said officers and directors, and for the benefit of no other person,
corporation or other entity. No purchaser of any of the Shares from any
Underwriter shall be construed a successor or assign by reason merely of such
purchase.
In all dealings hereunder, you shall act on behalf of each of the several
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of the Underwriters, made or
given by you jointly or by X.X. Xxxxxxx & Sons, Inc. on behalf of you as the
representatives, as if the same shall have been made or given in writing by the
Underwriters; and in all dealings with any Selling Shareholders hereunder, you
and the Company shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of such Selling Shareholder made or given by any
or all of the Attorneys-in-Fact for such Selling Xxxxxxxxxxx.
00
00. Counterparts. This Agreement may be executed by any one or more of
the parties hereto in any number of counterparts, each of which shall be deemed
to be an original, but all such counterparts shall together constitute one and
the same instrument.
17. Pronouns. Whenever a pronoun of any gender or number is used herein,
it shall, where appropriate, be deemed to include any other gender and number.
18. Time of Essence. Time shall be of the essence of this Agreement.
19. Applicable Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Missouri, without giving effect to the
choice of law or conflict of laws principles thereof.
[The remainder of this page is intentionally left blank.]
41
If the foregoing is in accordance with your understanding, please so
indicate in the space provided below for that purpose, whereupon this letter
shall constitute a binding agreement among the Company, the Selling Shareholders
and the Underwriters.
Xxxxxx Xxxxxx, Inc.
By: __________________________
Title: ________________________
Selling Shareholders Named in Schedule I hereto
By:__________________________
Attorney-in-Fact
Accepted in St. Louis,
Missouri as of the date
first above written, on
behalf of ourselves and each
of the several Underwriters
named in Schedule II hereto.
X.X. Xxxxxxx & Sons, Inc.
Xxxx Xxxxxxxx Incorporated
The Xxxxxxxx-Xxxxxxxx Company, LLC
XX Xxxxx Securities Corporation
As Representatives of the Several
Underwriters named on Schedule II hereto
By: X.X. XXXXXXX & SONS, INC.
By: ___________________________
Title: __________________________
42
SCHEDULE I
Number of
Option Shares
to be Sold
Selling Shareholder (if Option Fully Exercised)
------------------- ---------------------------
Xxxx X. Xxxxxxx 62,500
Total 62,500
------
43
SCHEDULE II
Number
Number of Option Shares
of Firm Shares to be Purchased
Name to be Purchased (if Option Fully Exercised)
---- --------------- ---------------------------
X.X. Xxxxxxx & Sons, Inc. __________ __________
Xxxx Xxxxxxxx Incorporated __________ __________
The Xxxxxxxx-Xxxxxxxx Company, LLC __________ __________
XX Xxxxx Securities Corporation __________ __________
Total 3,000,000 450,000
44
SCHEDULE III
Pursuant to Section 6(g) of the Underwriting Agreement, each of KPMG
LLP and Ernst & Young LLP shall furnish letters to the Underwriters to the
effect that:
(i) They are independent certified public accountants with respect to
the Company and its subsidiaries within the meaning of the 1933 Act and the
applicable Rules and Regulations thereunder.
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules audited (and, if applicable,
prospective financial statements and/or pro forma financial information
examined) by them and included or incorporated by reference in the
Prospectus or the Registration Statement comply as to form in all material
respects with the applicable accounting requirements of the 1933 Act and
the applicable Rules and Regulations with respect to registration
statements on Form S-3; and, if applicable, they have made a review in
accordance with standards established by the American Institute of
Certified Public Accountants (the "AICPA") of the unaudited consolidated
interim financial statements, selected financial data, pro forma financial
information, prospective financial statements and/or condensed financial
statements derived from audited financial statements of the Company for the
periods specified in such letter, as indicated in their reports thereon,
copies of which have been furnished to the Representatives of the
Underwriters (the "Representatives").
(iii) The unaudited selected financial information with respect to
the consolidated results of operations and financial position of the
Company for the five most recent fiscal years included in the Prospectus
agrees with the corresponding amounts (after restatements where applicable)
in the audited consolidated financial statements for such five fiscal years
which were included or incorporated by reference in the Company's Annual
Reports on Form10-K for such fiscal years.
(iv) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and on
the basis of limited procedures specified in such letter nothing came to
their attention as a result of the foregoing procedures that caused them to
believe that this information does not conform in all material respects
with the disclosure requirements of Items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
(v) On the basis of limited procedures, not constituting an audit in
accordance with generally accepted auditing standards, consisting of a
reading of the unaudited financial statements and other information
referred to below, performing the procedures specified by the AICPA for a
review of interim financial information as discussed in SAS
45
No. 71, Interim Financial Information, on the latest available interim
financial statements of the Company and its subsidiaries, inspection of the
minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included in the Prospectus, inquiries
of officials of the Company and its subsidiaries responsible for financial
and accounting matters and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention that caused them
to believe that:
(A) any material modifications should be made to the
unaudited statements of consolidated income, statements of
consolidated financial position and statements of consolidated cash
flows included or incorporated by reference in the Prospectus for them
to be in conformity with generally accepted accounting principles, or
the unaudited statements of consolidated income, statements of
consolidated financial position and statements of consolidated cash
flows included in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of the
1933 Act and the related published Rules and Regulations thereunder;
(B) any other unaudited income statement data and balance
sheet items included or incorporated by reference in the Prospectus do
not agree with the corresponding items in the unaudited consolidated
financial statements from which such data and items were derived, and
any such unaudited data and items were not determined on a basis
substantially consistent with the basis for the corresponding amounts
in the audited consolidated financial statements included or
incorporated by reference in the Prospectus;
(C) the unaudited financial statements which were not
included or incorporated by reference in the Prospectus but from which
were derived any unaudited condensed financial statements referred to
in Clause (A) and any unaudited income statement data and balance
sheet items included in the Prospectus and referred to in Clause (B)
were not determined on a basis substantially consistent with the basis
for the audited consolidated financial statements included or
incorporated by reference in the Prospectus;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the 1933 Act and the published rules and
regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of those
statements;
(E) as of a specified date not more than five days prior to
the date of such letter, there have been any changes in the
consolidated capital stock or any increase in the consolidated long-
term debt of the Company and its subsidiaries,
46
or any decreases in consolidated working capital, net current assets
or net assets, or any changes in any other items specified by the
Representatives, in each case as compared with amounts shown in the
latest balance sheet included or incorporated by reference in the
Prospectus, except in each case for changes, increases or decreases
which the Prospectus discloses have occurred or may occur or which are
described in such letter;
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in Clause (E) there were any decreases
in consolidated net revenues or operating profit or the total or per
share amounts of consolidated net income or any changes in any other
items specified by the Representatives, in each case as compared with
the comparable period of the preceding year and with any other period
of corresponding length specified by the Representatives, except in
each case for changes, decreases or increases which the Prospectus
discloses have occurred or may occur or which are described in such
letter.
(vi) In addition to the audit referred to in their report(s) included
or incorporated by reference in the Prospectus and the limited procedures,
inspection of minute books, inquiries and other procedures referred to in
paragraph (v) above, they have carried out certain specified procedures,
not constituting an audit in accordance with generally accepted auditing
standards, with respect to certain amounts, percentages and financial
information specified by the Representatives, which are derived from the
general accounting records of the Company and its subsidiaries for the
periods covered by their reports and any interim or other periods since the
latest period covered by their reports, which appear or are incorporated by
reference in the Prospectus, or in Part II of, or in exhibits and schedules
to, the Registration Statement, specified by the Representatives, and have
compared certain of such amounts, percentages and financial information
with the accounting records of the Company and its subsidiaries and have
found them to be in agreement.
47
EXHIBIT A
---------
Xxxxxx Xxxxxx, Inc. Subsidiaries
State of
Name of Subsidiary Incorporation/Organization Percentage Ownership
---------------------------- -------------------------- ---------------------
Xxxxxx Information
Services, Inc.1 New Jersey 100%
Heritage Labs
International, L.L.C.1 Kansas 55%2
Xxxxxx Xxxxxx Venture
Technology, Inc.3 New York 100%
Infield Medical
Technologies, Inc.3 New York 80%4
------------------
1 Active subsidiary
2 45%-owned by unaffiliated third party
3 Inactive subsidiary
4 20%-owned by unaffiliated third party
48
