EXHIBIT 1.1
_______________ SHARES
DIGITAS INC.
COMMON STOCK, $0.01 PAR VALUE PER SHARE
UNDERWRITING AGREEMENT
February __, 2000
February __, 2000
Xxxxxx Xxxxxxx & Co. Incorporated
Deutsche Banc Alex. Xxxxx
Xxxxxxx Xxxxx Xxxxxx
Banc of America Securities LLC
Bear, Xxxxxxx & Co. Inc.
c/o Morgan Xxxxxxx & Co.
Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Mesdames:
Digitas Inc., a Delaware corporation (the "COMPANY"), proposes to issue and
sell to the several Underwriters named in Schedule II hereto (the
"UNDERWRITERS"), and Xxxxxxx & Xxxxxxxx Capital Partners III, L.P., H&F Orchard
Partners III, L.P., H&F International Partners III, L.P., Squam Lake Investors,
III L.P. and Sunapee Securities, Inc. (together, the "SELLING SHAREHOLDERS")
severally propose to sell to the several Underwriters, an aggregate of
_______________ shares of the Common Stock, $0.01 par value per share of the
Company (the "FIRM SHARES"), of which _____________ shares are to be issued and
sold by the Company and _____________ shares are to be sold by the Selling
Shareholders, each Selling Shareholder selling the amount set forth opposite
such Selling Shareholder's name in Schedule I hereto.
The Company also proposes to issue and sell to the several Underwriters not
more than an additional ______________ shares of its Common Stock, $0.01 par
value per share (the "ADDITIONAL SHARES") if and to the extent that you, as
Managers of the offering, shall have determined to exercise, on behalf of the
Underwriters, the right to purchase such shares of common stock granted to the
Underwriters in Section 3 hereof. The Firm Shares and the Additional Shares are
hereinafter collectively referred to as the "SHARES". The shares of Common
Stock, $0.01 par value per share, of the Company to be outstanding after giving
effect to the sales contemplated hereby are hereinafter referred to as the
"COMMON STOCK". The Company and the Selling Shareholders are hereinafter
sometimes collectively referred to as the "SELLERS".
The Company has filed with the Securities and Exchange Commission (the
"COMMISSION") a registration statement, including a prospectus, relating to the
Shares. The
registration statement as amended at the time it becomes effective, including
the information (if any) deemed to be part of the registration statement at the
time of effectiveness pursuant to Rule 430A under the Securities Act of 1933, as
amended (the "SECURITIES ACT"), is hereinafter referred to as the "REGISTRATION
STATEMENT"; the prospectus in the form first used to confirm sales of Shares is
hereinafter referred to as the "PROSPECTUS". If the Company has filed an
abbreviated registration statement to register additional shares of Common Stock
pursuant to Rule 462(b) under the Securities Act (the "RULE 462 REGISTRATION
STATEMENT"), then any reference herein to the term "REGISTRATION STATEMENT"
shall be deemed to include such Rule 462 Registration Statement.
It is understood and agreed that immediately prior to the closing of the
above-mentioned offering of the Firm Shares, DGT Merger Corp., a Massachusetts
corporation and a wholly owned subsidiary of the Company, will be merged with
and into Xxxxxxx Xxxxxxxx Xxxxxxxx Co., a Massachusetts Business Trust (the
"Trust"), with the Trust being the surviving entity (the "Merger"). The Merger
will be accomplished on the terms and conditions set forth in that certain
Agreement and Plan of Merger, dated as of [the date hereof], by and between the
Company, DGT and the Trust (the "Merger Agreement"). Upon the effectiveness of
the Merger, the Trust will become a wholly owned subsidiary of the Company, and
all shares of capital stock or options to purchase capital stock in the Trust
will be canceled and converted into the right to receive capital stock or
options to purchase capital stock in the Company, on the terms set forth in the
Merger Agreement.
Xxxxxxx Xxxxx Barney Inc. has agreed to reserve a portion of the Shares to
be purchased by it under this Agreement for sale to the Company's directors,
officers, employees and business associates and other parties related to the
Company (collectively, "Participants"), as set forth in the Prospectus under the
heading "Underwriters" (the "Directed Share Program"). The Shares to be sold by
Xxxxxxx Xxxxx Xxxxxx Inc. and its affiliates pursuant to the Directed Share
Program are referred to hereinafter as the "Directed Shares." Any Directed
Shares not orally confirmed for purchase by any Participants by the end of the
business day on which this Agreement is executed will be offered to the public
by the Underwriters as set forth in the Prospectus.
1. Representations and Warranties of the Company. The Company represents
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and warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective, or in the case of
a Rule 462 Registration Statement, will become effective upon filing; no
stop order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or
threatened by the Commission.
(b) (i) The Registration Statement, when it became effective, did not
contain and, as amended, if applicable, will not 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, (ii) the Registration Statement and the Prospectus
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comply and, as amended or supplemented, if applicable, will comply in all
material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder and (iii) the Prospectus does not
contain and, as amended or supplemented, if applicable, will not contain
any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, except that the representations
and warranties set forth in this paragraph do not apply to statements or
omissions in the Registration Statement, or any amendment thereto, or the
Prospectus, or any supplement thereof, based upon information relating to
any Underwriter furnished to the Company in writing by such Underwriter
through you expressly for use therein.
(c) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property
and to conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the failure
to be so qualified or be in good standing would not have a material adverse
effect on the Company and the Trust (considered as one entity) and its
subsidiaries, taken as a whole; and the Trust has been duly organized and
is validly existing as a Massachusetts Business Trust in good standing
under the laws of the Commonwealth of Massachusetts, with the power to own
its properties and conduct its business as described in the Prospectus, and
is duly qualified for the transaction of business and is in good standing
under the laws of each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification, except to
the extent that the failure to be so qualified or be in good standing would
not have a material adverse effect on the Company and the Trust (considered
as one entity) and its subsidiaries, taken as a whole.
(d) Each subsidiary of the Company or the Trust has been duly
incorporated, is validly existing as a corporation or business trust in
good standing under the laws of the jurisdiction of its incorporation or
formation, has the corporate or similar power and authority to own its
property and to conduct its business as described in the Prospectus and is
duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and the Trust (considered as one
entity) and its subsidiaries, taken as a whole; all of the issued shares of
capital stock or other equity interests of each subsidiary of the Company
or the Trust have been duly and validly authorized and issued, are fully
paid and non-assessable (in the case of corporate subsidiaries) and are
owned directly or indirectly by the Company or the Trust, free and clear of
all liens, encumbrances, equities or claims.
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(e) This Agreement has been duly authorized, executed and delivered by
the Company and the Trust.
(f) The authorized capital stock of the Company conforms as to legal
matters to the description thereof contained in the Prospectus.
(g) The shares of Common Stock (including the Shares to be sold by the
Selling Shareholders) outstanding prior to the issuance of the Shares to be
sold by the Company (after giving effect to the Merger) have been duly
authorized and are validly issued, fully paid and non-assessable.
(h) The Shares to be sold by the Company have been duly authorized
and, when issued and delivered against payment therefor in accordance with
the terms of this Agreement, will be validly issued, fully paid and non-
assessable, and the issuance of such Shares will not be subject to any
preemptive or similar rights.
(i) The execution and delivery by the Company of, and the performance
by the Company and the Trust of its obligations under, this Agreement will
not contravene any provision of applicable law or the certificate of
incorporation or by-laws of the Company, the Limited Liability Company
Agreement of the Trust or any agreement or other instrument binding upon
the Company or the Trust or any of its subsidiaries that is material to the
Company and the Trust (considered as one entity) and its subsidiaries,
taken as a whole, or any judgment, order or decree of any governmental
body, agency or court having jurisdiction over the Company or the Trust or
any subsidiary, and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required for the
performance by the Company or the Trust of its obligations under this
Agreement, except the registration of the Shares under the Securities Act
or such as may be required by the securities or Blue Sky laws of the
various states in connection with the offer and sale of the Shares.
(j) Since the respective dates as of which information is given in the
Registration Statement or the Prospectus, there has not occurred any
material adverse change, or any development involving a prospective
material adverse change, in the condition, financial or otherwise, or in
the earnings, business or operations of the Company and the Trust
(considered as one entity) and its subsidiaries, taken as a whole, from the
description thereof set forth in the Prospectus (exclusive of any
amendments or supplements to the Registration Statement and/or the
Prospectus subsequent to the date of this Agreement).
(k) There are no legal or governmental proceedings pending or, to the
Company's and the Trust's knowledge, threatened to which the Company and
the Trust or any of its subsidiaries is a party or to which any of the
properties of the Company and the Trust or any of their subsidiaries is
subject that are required to be described in the
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Registration Statement or the Prospectus and are not so described or any
statutes, regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement that are not described or filed as
required.
(l) Each prospectus filed as part of the Registration Statement as
originally filed or as part of any amendment thereto, or filed pursuant to
Rule 424 under the Securities Act, complied when so filed in all material
respects with the Securities Act and the applicable rules and regulations
of the Commission thereunder.
(m) The Company is not, and after giving effect to the offering and
sale of the Shares and the application of the proceeds thereof as described
in the Prospectus will not be, required to register as an "investment
company" as such term is defined in the Investment Company Act of 1940, as
amended.
(n) The Company and the Trust and their subsidiaries (i) are in
compliance with any and all applicable foreign, federal, state and local
laws and regulations relating to the protection of human health and safety,
the environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("ENVIRONMENTAL LAWS"), (ii) have received all permits,
licenses or other approvals required of them under applicable Environmental
Laws to conduct their respective businesses and (iii) are in compliance
with all terms and conditions of any such permit, license or approval,
except where such noncompliance with Environmental Laws, failure to receive
required permits, licenses or other approvals or failure to comply with the
terms and conditions of such permits, licenses or approvals would not,
singly or in the aggregate, have a material adverse effect on the Company
and the Trust (considered as one entity) and its subsidiaries, taken as a
whole.
(o) There are no costs or liabilities associated with Environmental
Laws (including, without limitation, any capital or operating expenditures
required for clean-up, closure of properties or compliance with
Environmental Laws or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to third
parties) which would, singly or in the aggregate, have a material adverse
effect on the Company and the Trust (considered as one entity) and its
subsidiaries, taken as a whole.
(p) There are no contracts, agreements or understandings between the
Company or the Trust and any person granting such person the right to
require the Company to file a registration statement under the Securities
Act with respect to any securities of the Company or to require the Company
to include such securities with the Shares registered pursuant to the
Registration Statement, which contract, agreement or understanding has not
been disclosed in the Registration Statement and the provisions of which
have not been complied with or waived in respect of this Offering.
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(q) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, and except as
disclosed in the Registration Statement or the Prospectus with respect to
the Merger, (1) the Company and the Trust (considered as one entity) and
its subsidiaries have not incurred any material liability or obligation,
direct or contingent, nor entered into any material transaction not in the
ordinary course of business; (2) the Trust has not purchased any of its
outstanding capital stock, nor declared, paid or otherwise made any
dividend or distribution of any kind on its capital stock other than
ordinary and customary dividends; and (3) there has not been any material
change in the capital stock, short-term debt or long-term debt of the
Company and the Trust and its subsidiaries, except in each case as
described in the Prospectus.
(r) The Company and the Trust or one of their subsidiaries has good
title in fee simple to all real property and good title to all personal
property owned by them which is material to the business of the Company and
the Trust and their subsidiaries, in each case free and clear of all liens,
encumbrances and defects except such as are described in the Prospectus or
such as do not materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property by the
Company and the Trust and their subsidiaries; and any real property and
buildings held under lease by the Company and the Trust and their
subsidiaries are held by them under valid, subsisting and enforceable
leases with such exceptions as are not material and do not interfere with
the use made and proposed to be made of such property and buildings by the
Company and the Trust and their subsidiaries, in each case except as
described in the Prospectus.
(s) Other than as set forth in the Prospectus, the Company and the
Trust and their subsidiaries own or possess, or can acquire on reasonable
terms, all material patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks and trade names currently employed
by them in connection with the business now operated by them, and none of
the Company, the Trust nor any of their subsidiaries has received any
notice of infringement of or conflict with asserted rights of others with
respect to any of the foregoing which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would have a
material adverse affect on the Company and the Trust (considered as one
entity) and their subsidiaries, taken as a whole.
(t) No material labor dispute with the employees of the Company and
the Trust or any of their subsidiaries exists, except as described in the
Prospectus, or, to the knowledge of the Company and the Trust, is imminent;
and neither the Company nor the Trust is aware of any existing, threatened
or imminent labor disturbance by the employees of any of its principal
suppliers, manufacturers or contractors that could have a
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material adverse effect on the Company and the Trust (considered as one
entity) and their subsidiaries, taken as a whole.
(u) The Company, the Trust and their subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the businesses in
which they are engaged; none of the Company, the Trust nor any of their
subsidiaries has been refused any insurance coverage sought or applied for;
and neither the Company nor any of its subsidiaries has any reason to
believe that it will not be able to renew its existing insurance coverage
as and when such coverage expires or to obtain similar coverage from
similar insurers as may be necessary to continue its business at a cost
that would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole, except as described in the Prospectus.
(v) The Company, the Trust and their subsidiaries possess all
certificates, authorizations and permits issued by the appropriate federal,
state or foreign regulatory authorities necessary to conduct their
respective businesses, except to the extent failure to have the same would
not have a material adverse effect on the Company and the Trust (considered
as one entity) and its subsidiaries, taken as a whole, and none of the
Company, the Trust nor any of their subsidiaries has received any notice of
proceedings relating to the revocation or modification of any such
certificate, authorization or permit which proceedings, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
would have a material adverse effect on the Company and the Trust
(considered as one entity) and its subsidiaries, taken as a whole, except
as described in the Prospectus.
(w) The Company and the Trust and each of their subsidiaries maintain
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
asset accountability; (3) access to assets is permitted only in accordance
with management's general or specific authorization; and (4) the recorded
accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(x) To the Company's knowledge, the accountants who have certified or
shall certify the financial statements filed or to be filed with the
Commission as part of the Registration Statement and the Prospectus are
independent accountants as required by the Securities Act and the rules and
regulations thereunder. The consolidated financial statements of the
Company (together with the related notes thereto) included in the
Registration Statement present fairly the financial position and results of
operations of the Company at the respective dates and for the respective
periods to which they apply,
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subject to normal year-end adjustments. Such consolidated financial
statements have been prepared in accordance with generally accepted
accounting principles consistently applied throughout the periods involved
except as otherwise stated therein. The pro forma financial information of
the Company included in the Registration Statement has been prepared in
accordance with the Commission's rules and guidelines with respect to pro
forma financial statements, has been properly compiled on the bases
described therein and, in the opinion of the Company, the assumptions used
in the preparation thereof are reasonable and the adjustments used therein
are appropriate to give effect to the transactions and circumstances
referred to therein.
(y) The Shares have been approved for listing on the Nasdaq National
Market.
(z) The Registration Statement, the Prospectus and any preliminary
prospectus comply, and any amendments or supplements thereto will comply,
with any applicable laws or regulations of foreign jurisdictions in which
the Prospectus or any preliminary prospectus, as amended or supplemented,
if applicable, are distributed in connection with the Directed Share
Program.
(aa) No consent, approval, license, authorization or order of, or
registration or qualification with, any governmental body or agency or
court, other than those obtained, is required in connection with the
offering of the Directed Shares in any jurisdiction where the Directed
Shares are being offered.
(bb) Neither the Company nor the Trust has offered, or caused the
Underwriters or their affiliates to offer, Shares to any person pursuant to
the Directed Share Program with the specific intent to unlawfully influence
(i) a customer or supplier of the Company or the Trust to alter the
customer's or supplier's level or type of business with the Company or the
Trust, or (ii) a trade journalist or publication to write or publish
favorable information about the Company or the Trust or its products.
(cc) The Trust has reviewed its operations and that of its
subsidiaries to evaluate the extent to which the business or operations of
the Trust or any of its subsidiaries has been affected by the Year 2000
Problem (that is, any significant risk that computer hardware or software
applications used by the Trust and its subsidiaries will not, in the case
of dates or time periods occurring after December 31, 1999, function at
least as effectively as in the case of dates or time periods occurring
prior to January 1, 2000); as a result of such review, (i) the Trust has no
reason to believe, and does not believe, that (A) there are any issues
related to the Trust's preparedness to address the Year 2000 Problem that
are of a character required to be described or referred to in the
Registration Statement or Prospectus which have not been accurately
described in the Registration Statement or Prospectus and (B) the Year 2000
Problem has had or will have a material adverse effect on the condition,
financial or otherwise, or on the earnings, business or operations of the
Trust and its subsidiaries, taken as a whole, or result in any
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material loss or interference with the business or operations of the
Company and the Trust (considered as one entity) and its subsidiaries,
taken as a whole; and (ii) the Trust reasonably believes, after due
inquiry, that the suppliers, vendors, customers or other material third
parties used or served by the Company and the Trust and such subsidiaries
have addressed, are addressing or will address the Year 2000 Problem in a
timely manner, except to the extent that a failure to address the Year 2000
Problem by any supplier, vendor, customer or material third party would not
have a material adverse effect on the condition, financial or otherwise, or
on the earnings, business or operations of the Company and the Trust
(considered as one entity) and its subsidiaries, taken as a whole.
(dd) To the knowledge of the Trust and the Company, no officer or
director of the Company or the Trust is in breach or violation of any
employment agreement, non-competition agreement, confidentiality agreement,
or other agreement restricting the nature or scope of employment to which
such officer or director is a party, and, to the knowledge of the Company
and the Trust, the conduct of the Company's business, as described in the
Registration Statement and Prospectus, will not result in a breach or
violation of any such agreement.
(ee) There are no outstanding options to acquire shares of capital
stock of the Company except as disclosed in the Registration Statement and
the Prospectus and except as have been granted under the [ ].
(ff) There are no outstanding warrants to acquire shares of capital
stock of the Company except as disclosed in the Registration Statement and
the Prospectus and except as have been granted under the [ ].
(gg) The Merger Agreement is in full force and effect, has been duly
authorized, executed and delivered by the Company and the Trust, and is
valid and binding on the Company and the Trust in accordance with its
terms, with neither party in default thereunder.
2. Representations and Warranties of the Selling Shareholders. Each of the
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Selling Shareholders, severally and not jointly represents and warrants to and
agrees with each of the Underwriters that:
(a) This Agreement has been duly authorized, executed and delivered by
or on behalf of such Selling Shareholder.
(b) The execution of and delivery by or on behalf of such Selling
Shareholder of, and the performance by such Selling Shareholder of its
obligations under, this Agreement, the Custody Agreement signed by such
Selling Shareholder and American Stock Transfer & Trust Company, as
Custodian, relating to the deposit of the
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Shares to be sold by such Selling Shareholder (the "CUSTODY AGREEMENT") and
the Power of Attorney appointing certain individuals as such Selling
Shareholder's attorneys-in-fact to the extent set forth therein, relating
to the transactions contemplated hereby and by the Registration Statement
(the "POWER OF ATTORNEY") will not contravene any provision of applicable
law, or the certificate of incorporation or by-laws of such Selling
Shareholder (if such Selling Shareholder is a corporation), or any
agreement or other instrument binding upon such Selling Shareholder or any
judgment, order or decree of any governmental body, agency or court having
jurisdiction over such Selling Shareholder, and no consent, approval,
authorization or order of, or qualification with, any governmental body or
agency is required for the performance by such Selling Shareholder of its
obligations under this Agreement or the Custody Agreement or Power of
Attorney of such Selling Shareholder, except such as may be required by the
securities or Blue Sky laws of the various states, the Securities Act or
the NASD Rules in connection with the offer and sale of the Shares.
(c) Such Selling Shareholder has, and on the Closing Date will have,
valid title to the Shares to be sold by such Selling Shareholder and the
legal right and power, and all authorization and approval required by law,
to enter into this Agreement, the Custody Agreement and the Power of
Attorney and to sell, transfer and deliver the Shares to be sold by such
Selling Shareholder.
(d) The Custody Agreement and the Power of Attorney have been duly
authorized, executed and delivered by or on behalf of such Selling
Shareholder and are valid and binding agreements of such Selling
Shareholder.
(e) Upon sale and delivery of and payment for the Shares to be sold by
such Selling Shareholder pursuant to this Agreement, title to such Shares
will pass free and clear of any security interests, claims, liens, equities
and other encumbrances other than any such security interest, claim, lien
equity or encumbrance created by or resulting from an action taken by an
Underwriter.
(f) The information in the Prospectus which specifically relates to
such Selling Shareholder which has been furnished in writing by or on
behalf of such Selling Shareholder expressly for use in the Registration
Statement, any Preliminary Prospectus, the Prospectus or any amendments or
supplements thereto does not on the date of the execution of this Agreement
or will not on the Closing Date, contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading.
3. Agreements to Sell and Purchase. Each Seller, severally and not jointly,
-------------------------------
hereby agrees to sell to the several Underwriters, and each Underwriter, upon
the basis of the representations and warranties herein contained, but subject to
the conditions hereinafter
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stated, agrees, severally and not jointly, to purchase from such Seller at
$______ a share (the "PURCHASE PRICE") the number of Firm Shares (subject to
such adjustments to eliminate fractional shares as you may determine) that bears
the same proportion to the number of Firm Shares to be sold by such Seller as
the number of Firm Shares set forth in Schedule II hereto opposite the name of
such Underwriter bears to the total number of Firm Shares.
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the Underwriters the Additional Shares, and the Underwriters shall have a
one-time right to purchase, severally and not jointly, up to _______________
Additional Shares at the Purchase Price. If you, on behalf of the Underwriters,
elect to exercise such option, you shall so notify the Company in writing not
later than 30 days after the date of this Agreement, which notice shall specify
the number of Additional Shares to be purchased by the Underwriters and the date
on which such shares are to be purchased. Such date may be the same as the
Closing Date (as defined below) but not earlier than the Closing Date nor later
than ten business days after the date of such notice. Additional Shares may be
purchased as provided in Section 5 hereof solely for the purpose of covering
over-allotments made in connection with the offering of the Firm Shares. If any
Additional Shares are to be purchased, each Underwriter agrees, severally and
not jointly, to purchase the number of Additional Shares (subject to such
adjustments to eliminate fractional shares as you may determine) that bears the
same proportion to the total number of Additional Shares to be purchased as the
number of Firm Shares set forth in Schedule II hereto opposite the name of such
Underwriter bears to the total number of Firm Shares.
The Company hereby agrees that, without the prior written consent of Xxxxxx
Xxxxxxx & Co. Incorporated ("Xxxxxx Xxxxxxx") on behalf of the Underwriters, it
will not, during the period ending 180 days after the date of the Prospectus,
(i) offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase, lend, or otherwise transfer or dispose of, directly or
indirectly, any shares of Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock or (ii) enter into any swap or
other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the Common Stock, whether any such
transaction described in clause (i) or (ii) above is to be settled by delivery
of Common Stock or such other securities, in cash or otherwise. The foregoing
sentence shall not apply to (A) the Shares to be sold hereunder, (B) the
issuance by the Company of shares of Common Stock upon the exercise of an option
or warrant or the conversion of a security outstanding on the date hereof of
which the Underwriters have been advised in writing or (C) transactions by any
person other than the Company relating to shares of Common Stock or other
securities acquired in open market transactions after the completion of the
offering of the Shares.
Each Selling Shareholder hereby agrees that, without the prior written
consent of Xxxxxx Xxxxxxx on behalf of the Underwriters, it will not, during the
period ending 180 days after the date of the Prospectus, (i) offer, pledge,
sell, contract to sell, sell any option or
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contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase, lend, or otherwise transfer or dispose of,
directly or indirectly, any shares of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock or (ii) enter into any swap
or other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the Common Stock, whether any such
transaction described in clause (i) or (ii) above is to be settled by delivery
of Common Stock or such other securities, in cash or otherwise; provided,
however, that if the last reported sale price of the Common Stock per share is
at least twice the price per share of the Common Stock sold hereunder for 20 out
of the 30 consecutive trading days ending on the trading day immediately
preceding the 90th day after the date of the Prospectus, then the foregoing
restrictions shall be earlier released with respect to 33% of the shares of
Common Stock held by such Selling Shareholder on the date hereof on the later to
occur of (a) the 90th day after the date of the Prospectus if the Company makes
its first post-offering public release of its quarterly or annual earnings
results during the period beginning on the eleventh trading day after the date
of the Prospectus and ending on the day prior to the 90th day after the date of
the Prospectus, or (b) the second trading day after the first public release of
the Company's quarterly or annual results occurring on or after the 90th day
after the date of the Prospectus if the Company does not make its first
post-offering public release as set forth in the foregoing clause (a).
Notwithstanding the foregoing, (a) gifts and transfers by will or intestacy or
(b) transfers to (A) such Selling Shareholder's members, partners, affiliates or
immediate family or (B) a trust, the beneficiaries of which are such Selling
Shareholder and/or members of such Selling Shareholder's immediate family, shall
not be prohibited by this Agreement; provided that (x) the donee or transferee
agrees in writing to be bound by the foregoing in the same manner as it applies
to such Selling Shareholder (and a copy of such agreement is delivered to Xxxxxx
Xxxxxxx) and (y) if the donor or transferor is a reporting person subject to
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act"), any
gifts or transfers made in accordance with this paragraph shall not require such
person to, and such person shall not voluntarily, file a report of such
transaction on Form 4 under the Exchange Act. "Immediate family" shall mean
spouse, lineal descendants, father, mother, brother, sister or first cousin of
the transferor and father, mother, brother or sister of the transferor's spouse.
In addition, the restrictions contained in clauses (i) and (ii) above shall not
apply to (a) transactions entered into with the prior written consent of Xxxxxx
Xxxxxxx on behalf of the Underwriters, or (b) transactions relating to shares of
Common Stock or other securities acquired in open market transactions after the
completion of the Public Offering. Such Selling Shareholder further agrees that,
without the prior written consent of Xxxxxx Xxxxxxx on behalf of the
Underwriters, he, she or it will not, during the period commencing on the date
hereof and ending 180 days after the date of the Prospectus, make any demand for
or exercise any right with respect to, the registration of any shares of Common
Stock or any security convertible into or exercisable or exchangeable for Common
Stock.
4. Terms of Public Offering. The Sellers are advised by you that the
------------------------
Underwriters propose to make a public offering of their respective portions of
the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is
- 12 -
advisable. The Sellers are further advised by you that the Shares are to be
offered to the public initially at $_____________ per share (the "PUBLIC
OFFERING PRICE") and to certain dealers selected by you at a price that
represents a concession not in excess of $______ per share under the Public
Offering Price, and that any Underwriter may allow, and such dealers may
reallow, a concession, not in excess of $_____ per share, to any Underwriter or
to certain other dealers.
5. Payment and Delivery. Payment for the Firm Shares to be sold by each
--------------------
Seller shall be made to such Seller in Federal or other funds immediately
available in New York City against delivery of such Firm Shares for the
respective accounts of the several Underwriters at 10:00 a.m., New York City
time, on ____________, 2000, or at such other time on the same or such other
date, not later than _________, 2000, as shall be designated in writing by you.
The time and date of such payment are hereinafter referred to as the "CLOSING
DATE".
Payment for any Additional Shares shall be made to the Company in Federal
or other funds immediately available in New York City against delivery of such
Additional Shares for the respective accounts of the several Underwriters at
10:00 a.m., New York City time, on the date specified in the notice described in
Section 3 or at such other time on the same or on such other date, in any event
not later than _______, 2000, as shall be designated in writing by you. The time
and date of such payment are hereinafter referred to as the "OPTION CLOSING
DATE".
Certificates for the Firm Shares and Additional Shares shall be in
definitive form and registered in such names and in such denominations as you
shall request in writing not later than two full business days prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to you on
the Closing Date or the Option Closing Date, as the case may be, for the
respective accounts of the several Underwriters, with any transfer taxes payable
in connection with the transfer of the Shares to the Underwriters duly paid,
against payment of the Purchase Price therefor.
6. Conditions to the Underwriters' Obligations. The obligations of the
-------------------------------------------
Sellers to sell the Shares to the Underwriters and the several obligations of
the Underwriters to purchase and pay for the Shares on the Closing Date are
subject to the condition that the Registration Statement shall have become
effective not later than [__________] (New York City time) on the date hereof.
The several obligations of the Underwriters are subject to the following
further conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
- 13 -
(i) there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or of
any review for a possible change that does not indicate the direction
of the possible change, in the rating accorded any of the Company's
securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act; and
(ii) there shall not have occurred any change, or any development
involving a prospective change, in the condition, financial or
otherwise, or in the earnings, business or operations of the Company
and its subsidiaries, taken as a whole, from that set forth in the
Prospectus (exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement) that, in your judgment, is
material and adverse and that makes it, in your judgment,
impracticable to market the Shares on the terms and in the manner
contemplated in the Prospectus.
(b) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of
the Company, to the effect set forth in Section 6(a)(i) above and to the
effect that the representations and warranties of the Company contained in
this Agreement are true and correct as of the Closing Date and that the
Company has complied with all of the agreements and satisfied all of the
conditions on its part to be performed or satisfied hereunder on or before
the Closing Date.
The officer signing and delivering such certificate may rely upon the
best of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxxx, Procter & Xxxx LLP, outside counsel for the Company,
dated the Closing Date, to the effect that:
(i) the Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the jurisdiction
of its incorporation, has the corporate power to own its property and
to conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing under the laws
of the Commonwealth of Massachusetts, the State of New York and
[_______________], which are the only jurisdictions in the United
States in which the Company owns or leases real property or maintains
an office;
(ii) each subsidiary of the Company has been duly incorporated or
formed, is validly existing as a corporation or business trust in good
standing under the laws of the jurisdiction of its incorporation or
formation, has the
- 14 -
corporate or similar power to own its property and to conduct its
business as described in the Prospectus and is duly qualified to
transact business and is in good standing under the laws of the
Commonwealth of Massachusetts, the State of New York and
[____________];
(iii) the authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the Prospectus;
(iv) the shares of Common Stock (including the Shares to be sold
by the Selling Shareholders) outstanding prior to the issuance of the
Shares to be sold by the Company have been duly authorized and are
validly issued, fully paid and non-assessable;
(v) all of the issued shares of capital stock or other equity
interests of each subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable (in the case
of corporate subsidiaries) and are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities or
claims;
(vi) the Shares to be sold by the Company have been duly
authorized and, when issued and delivered in accordance with the terms
of this Agreement, will be validly issued, fully paid and non-
assessable, and the issuance of such Shares will not be subject to any
preemptive rights, or, to the best of such counsel's knowledge,
similar rights;
(vii) this Agreement has been duly authorized, executed and
delivered by the Company;
(viii) the execution and delivery by the Company, and the
performance by the Company of its obligations under, this Agreement
will not result in a violation of any provision of applicable law or
the certificate of incorporation or by-laws of the Company or, to the
best of such counsel's knowledge, result in a breach or violation of
or cause a default under any agreement or other instrument binding
upon the Company or any of its subsidiaries that is filed as an
exhibit to the Registration Statement or identified by counsel to the
Underwriters and identified on a schedule to such opinion, or, to the
best of such counsel's knowledge, result in a violation of any
judgment, order or decree, known to such counsel, of any governmental
body, agency or court having jurisdiction over the Company or any
subsidiary, and no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is required for
the performance by the Company of its obligations under this
Agreement, except the registration under the Securities
- 15 -
Act of the Shares or such as may be required by the securities or Blue
Sky laws of the various states in connection with the offer and sale
of the Shares;
(ix) the statements (A) in the Prospectus under the captions
"Description of Capital Stock" and "Underwriters" (but only with
respect to the description of this Agreement set forth therein) and
(B) in the Registration Statement in Items 14 and 15, in each case
insofar as such statements constitute summaries of the legal matters,
documents or proceedings referred to therein, fairly present the
information called for with respect to such legal matters, documents
and proceedings and fairly summarize the matters referred to therein;
(x) after due inquiry, such counsel does not know of any legal or
governmental proceedings pending or threatened to which the Company or
any of its subsidiaries is a party or to which any of the properties
of the Company or any of its subsidiaries is subject that are required
to be described in the Registration Statement or the Prospectus and
are not so described or of any statutes, regulations, contracts or
other documents that are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as required;
(xi) the Company is not, and after giving effect to the offering
and sale of the Shares and the application of the proceeds thereof as
described in the Prospectus will not be required to register as an
"investment company" as such term is defined in the Investment Company
Act of 1940, as amended;
(xii) such counsel is of the opinion that the Registration
Statement and Prospectus (except for financial statements and
schedules and other financial and statistical data included therein as
to which such counsel need not express any opinion) appears on its
face to be appropriately responsive in all material respects to the
requirements of the Securities Act and the applicable rules and
regulations of the Commission thereunder although such counsel does
not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement or
the Prospectus, except for those referred to in the opinion in
subsection (ix) of this Section 6(c).
Such counsel shall also state that counsel has participated in
the preparation of the Registration Statement and Prospectus and has
participated in discussions with the Representatives, counsel for the
Underwriters, and representatives of the Company and its accountants.
On the basis of the information such counsel has gained in the course
of the performance of the services referred to above, such counsel
shall confirm to you that nothing that came to such counsel's
attention in the course of such review has caused them to believe that
the Registration Statement or any amendment thereto contains any
- 16 -
untrue statement of material fact or omits any material fact required
to be stated therein or necessary to make the statements therein not
misleading, or that, as of its date, the Prospectus and any amendments
thereto, contained any untrue statement of a material fact or omitted
any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they
were made, not misleading, or that either the Registration Statement
or the Prospectus and any amendments thereto contained any untrue
statement of a material fact or omitted any material fact required to
be stated therein or necessary to make the statements therein not
misleading; and such counsel shall state that they do not know of any
amendment to the Registration Statement required to be filed.
Also, such counsel need not make any statement as to the
financial statements, other financial, operating, statistical or
accounting data and related schedules contained in the Registration
Statement or Prospectus.
(d) The Underwriters shall have received on the Closing Date an
opinion of XxXxxxxxx, Will & Xxxxx, counsel for Squam Lake Investors, III
L.P. ("Squam") and Sunapee Securities, Inc. ("Sunapee"), dated the Closing
Date, to the effect that:
(i) this Agreement has been duly authorized, executed and
delivered by or on behalf of Squam and Sunapee;
(ii) the execution and delivery by Squam and Sunapee of, and the
performance by Squam and Sunapee of their obligations under this
Agreement and the Custody Agreement and Power of Attorney will not
contravene any provision of applicable law, or, to the best of such
counsel's knowledge, any agreement or other instrument binding upon
Squam or Sunapee or, to the best of such counsel's knowledge, any
judgment, order or decree of any governmental body, agency or court
having jurisdiction over Squam or Sunapee, and no consent, approval,
authorization or order of, or qualification with, any governmental
body or agency is required for the performance by Squam and Sunapee of
their obligations under this Agreement or the Custody Agreement or
Power of Attorney, except such as may be required by the Securities
Act, the securities or Blue Sky laws of the various states or NASD
Rules in connection with offer and sale of the Shares (as to none of
which such counsel need opine);
(iii) to the best of such counsel's knowledge, as of the time
immediately preceding the time of delivery of the Shares to be sold by
them to the Underwriters, Squam and Sunapee had valid title to the
Shares to be sold by them and the full right, power, and authority to
enter into this Agreement and the Custody Agreement and Power of
Attorney and to sell, transfer and deliver the Shares to be sold by
them;
- 17 -
(iv) the Custody Agreement and the Power of Attorney of Squam and
Sunapee have been duly authorized, executed and delivered by them and
are valid and binding agreements of them; and
(v) upon payment pursuant to this Agreement for the Shares,
delivery of the Shares to be sold by Squam and Sunapee as directed by
the Underwriters to Cede & Co., or another nominee as may be
designated by Depository Trust Company ("DTC"), and assuming that
neither DTC nor any such Underwriter has any "notice of an adverse
claim" (as defined in Section 8-105 of the UCC)) to the Shares, (A)
DTC shall be a "protected purchaser" of such Shares within the meaning
of Section 8-303 of the Uniform Commercial Code, as in effect in The
Commonwealth of Massachusetts (the "UCC"); (B) under Section 8-501 of
the UCC, each Underwriter will acquire a valid "security entitlement"
(as defined in Section 8-102 of the UCC) to the Shares being so
purchased on behalf of such Underwriter, and (C) to the extent
governed by the UCC, no action based on any "adverse claim" (as
defined in Section 8-102 of the UCC) to the Shares (or security
entitlement with respect thereto) may properly be asserted against the
Underwriters with respect to such security entitlement.
(e) The Underwriters shall have received on the Closing Date an
opinion of Wachtell, Lipton, Xxxxx & Xxxx, counsel for Xxxxxxx & Xxxxxxxx
Capital Partners III, L.P., H&F Orchard Partners III, L.P. and H&F
International Partners III, L.P.(each an "H&F Seller" and collectively the
"H&F Sellers"), dated the Closing Date, to the effect that:
(i) this Agreement has been duly authorized, executed and
delivered by or on behalf of each of the H&F Sellers;
(ii) the execution and delivery by each of the H&F Sellers of
their obligations under, this Agreement and the Custody Agreement and
Power of Attorney of each of the H&F Sellers will not contravene any
provision of applicable law, or the certificate of incorporation or
by-laws of any of the H&F Sellers (if such Selling Shareholder is a
corporation), or, to the best of such counsel's knowledge, any
agreement or other instrument binding upon any of the H&F Sellers or,
to the best of such counsel's knowledge, any judgment, order or decree
of any governmental body, agency or court having jurisdiction over any
of the H&F Sellers, and no consent, approval, authorization or order
of, or qualification with, any governmental body or agency is required
for the performance by each of the H&F Sellers of their obligations
under this Agreement or the Custody Agreement or Power of Attorney,
except such as may be required by the securities or Blue Sky laws of
the various states in connection with offer and sale of the Shares;
- 18 -
(iii) Each of the H&F Sellers have valid title to the Shares to
be sold by each of them and the legal right and power, and all
authorization and approval required by law, to enter into this
Agreement and the Custody Agreement and Power of Attorney and to sell,
transfer and deliver the Shares to be sold by each of them;
(iv) the Custody Agreement and the Power of Attorney of each of
the H&F Sellers have been duly authorized, executed and delivered by
each of the H&F Sellers, respectively, and are valid and binding
agreements of each of the H&F Sellers; and
(v) upon sale and delivery of and payment for the Shares to be
sold by each of the H&F Sellers pursuant to this Agreement, title to
such Shares will pass free and clear of any security interests,
claims, liens, equities and other encumbrances other than any such
security interest, claim, lien, equity or encumbrance created by or
resulting from an action taken by an Underwriter.
(f) The Underwriters shall have received on the Closing Date an
opinion of Ropes & Xxxx, counsel for the Underwriters, dated the Closing
Date, covering the matters referred to in Sections 6(c)(vi), 6(c)(vii),
6(c)(ix) (but only as to the statements in the Prospectus under
"Description of Capital Stock" and "Underwriters") and 6(c)(xii) above.
With respect to Section 6(c)(xii) above, Xxxxxxx, Procter & Xxxx LLP
and Ropes & Xxxx may state that their opinion and belief are based upon
their participation in the preparation of the Registration Statement and
Prospectus and any amendments or supplements thereto and review and
discussion of the contents thereof, but are without independent check or
verification, except as specified. With respect to Section 6(c) above,
Xxxxxxx, Procter & Xxxx LLP may rely upon an opinion or opinions of counsel
for any Selling Shareholders and, with respect to factual matters and to
the extent such counsel deems appropriate, upon the representations of each
Selling Shareholder contained herein and in the Custody Agreement and Power
of Attorney of such Selling Shareholder and in other documents and
instruments; provided that (A) each such counsel for the Selling
Shareholders is satisfactory to your counsel, (B) a copy of each opinion so
relied upon is delivered to you and is in form and substance satisfactory
to your counsel, (C) copies of such Custody Agreements and Powers of
Attorney and of any such other documents and instruments shall be delivered
to you and shall be in form and substance satisfactory to your counsel and
(D) Xxxxxxx, Procter & Xxxx LLP shall state in their opinion that they are
justified in relying on each such other opinion.
The opinions of Xxxxxxx, Procter & Xxxx LLP, Wachtell, Lipton, Xxxxx &
Xxxx and XxXxxxxxx, Will & Xxxxx described in Sections 6(c), 6(d) and 6(e)
above
- 19 -
(and any opinions of counsel for any Selling Shareholder referred to in the
immediately preceding paragraph) shall be rendered to the Underwriters at
the request of the Company or one or more of the Selling Shareholders, as
the case may be, and shall so state therein.
(g) The Underwriters shall have received, on each of the date hereof
and the Closing Date, a letter dated the date hereof or the Closing Date,
as the case may be, in form and substance satisfactory to the Underwriters,
from each of PricewaterhouseCoopers, LLP and Xxxxxx Xxxxxxxx LLP
independent public accountants, containing statements and information of
the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain financial
information contained in the Registration Statement and the Prospectus;
provided that the letter delivered on the Closing Date shall use a "cut-off
date" not earlier than the date hereof.
(h) The "lock-up" agreements, each substantially in the form of
Exhibit A hereto, between you and certain shareholders, officers and
directors of the Company relating to sales and certain other dispositions
of shares of Common Stock or certain other securities, delivered to you on
or before the date hereof, shall be in full force and effect on the Closing
Date.
(i) The Merger shall have been consummated as contemplated by the
Prospectus.
The several obligations of the Underwriters to purchase Additional Shares
hereunder are subject to the delivery to you on the Option Closing Date of such
documents as you may reasonably request with respect to the good standing of the
Company, the due authorization and issuance of the Additional Shares and other
matters related to the issuance of the Additional Shares.
7. Covenants of the Company. In further consideration of the agreements of
------------------------
the Underwriters herein contained, the Company covenants with each Underwriter
as follows:
(a) To furnish to you, without charge, 6 signed copies of the
Registration Statement (including exhibits thereto) and for delivery to
each other Underwriter a conformed copy of the Registration Statement
(without exhibits thereto) and to furnish to you in New York City, without
charge, prior to 10:00 a.m. New York City time on the business day next
succeeding the date of this Agreement and during the period mentioned in
Section 7(c) below, as many copies of the Prospectus and any supplements
and amendments thereto or to the Registration Statement as you may
reasonably request.
- 20 -
(b) Before amending or supplementing the Registration Statement or the
Prospectus, to furnish to you a copy of each such proposed amendment or
supplement and not to file any such proposed amendment or supplement to
which you reasonably object, and to file with the Commission within the
applicable period specified in Rule 424(b) under the Securities Act any
prospectus required to be filed pursuant to such Rule.
(c) If, during such period after the first date of the public offering
of the Shares as in the opinion of counsel for the Underwriters the
Prospectus is required by law to be delivered in connection with sales by
an Underwriter or dealer, any event shall occur or condition exist as a
result of which it is necessary to amend or supplement the Prospectus in
order to make the statements therein, in the light of the circumstances
when the Prospectus is delivered to a purchaser, not misleading, or if, in
the opinion of counsel for the Underwriters, it is necessary to amend or
supplement the Prospectus to comply with applicable law, forthwith to
prepare, file with the Commission and furnish, at its own expense, to the
Underwriters and to the dealers (whose names and addresses you will furnish
to the Company) to which Shares may have been sold by you on behalf of the
Underwriters and to any other dealers upon request, either amendments or
supplements to the Prospectus so that the statements in the Prospectus as
so amended or supplemented will not, in the light of the circumstances when
the Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus, as amended or supplemented, will comply with law.
(d) To refrain from releasing any of the officers, directors or
beneficial owners of common stock from the "lock-up" agreements referenced
in Section 6(f) above.
(e) To endeavor to qualify the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request.
(f) To make generally available to the Company's security holders and
to you as soon as practicable an earning statement covering the twelve-
month period ending March 31, 2001, that satisfies the provisions of
Section 11(a) of the Securities Act and the rules and regulations of the
Commission thereunder (including, at the option of the Company, Rule 158).
(g) To place stop transfer orders on any Directed Shares that have
been sold to Participants subject to the three month restriction on sale,
transfer, assignment, pledge or hypothecation imposed by NASD Regulation,
Inc. under its Interpretative Material 2110-1 on free-riding and
withholding to the extent necessary to ensure compliance with the three
month restrictions.
- 21 -
(h) In connection with the Directed Share Program, the Company will
ensure that the Directed Shares will be restricted to the extent required
by the National Association of Securities Dealers, Inc. (the "NASD") or the
NASD rules from sale, transfer, assignment, pledge or hypothecation for a
period of three months following the date of the effectiveness of the
Registration Statement. Xxxxxxx Xxxxx Xxxxxx Inc. will notify the Company
as to which Participants will need to be so restricted. The Company will
direct the removal of such transfer restrictions upon the expiration of
such period of time.
(i) To comply with all applicable securities and other applicable
laws, rules and regulations in each jurisdiction in which the Directed
Shares are offered in connection with the Directed Share Program.
8. Expenses. Whether or not the transactions contemplated in this Agreement
--------
are consummated or this Agreement is terminated, (A) the Company agrees to pay
or cause to be paid all expenses incident to the performance of its obligations
under this Agreement, including: (i) the fees, disbursements and expenses of the
Company's counsel and the Company's accountants in connection with the
registration and delivery of the Shares under the Securities Act and all other
fees or expenses in connection with the preparation and filing of the
Registration Statement, any preliminary prospectus, the Prospectus and
amendments and supplements to any of the foregoing, including all printing costs
associated therewith, and the mailing and delivering of copies thereof to the
Underwriters and dealers, in the quantities hereinabove specified, (ii) all
costs and expenses related to the transfer and delivery of the Shares to the
Underwriters, including any transfer or other taxes payable thereon, (iii) the
cost of printing or producing any Blue Sky or Legal Investment memorandum in
connection with the offer and sale of the Shares under state securities laws and
all expenses in connection with the qualification of the Shares for offer and
sale under state securities laws as provided in Section 7(d) hereof, including
filing fees and the reasonable fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the
Blue Sky or Legal Investment memorandum, (iv) all filing fees and the reasonable
fees and disbursements of counsel to the Underwriters incurred in connection
with the review and qualification of the offering of the Shares by the National
Association of Securities Dealers, Inc., (v) all fees and expenses of counsel to
the Underwriters incurred on behalf of, or disbursements by, Xxxxxx Xxxxxxx in
its capacity as "qualified independent underwriter", (vi) all fees and expenses
in connection with the preparation and filing of the registration statement on
Form 8-A relating to the Common Stock and all costs and expenses incident to
listing the Shares on the Nasdaq National Market, (vii) the cost of printing
certificates representing the Shares, (viii) the costs and charges of any
transfer agent, registrar or depositary, (ix) all expenses in connection with
any offer and sale of the Shares outside of the United States, including filing
fees and the reasonable fees and disbursements of counsel for the Underwriters
in connection with offers and sales outside of the United States, (x) the costs
and expenses of the Company relating to investor presentations on any "road
show" undertaken in connection with the marketing of the offering of the Shares,
including, without limitation, expenses associated with the production of road
show
- 22 -
slides and graphics, fees and expenses of any consultants engaged in
connection with the road show presentations with the prior approval of the
Company or the Trust, travel and lodging expenses of the representatives and
officers of the Company or the Trust and any such consultants, and the cost of
any aircraft chartered in connection with the road show, (xi) all other costs
and expenses incident to the performance of the obligations of the Company and
the Trust hereunder for which provision is not otherwise made in this Section,
(xii) all fees and disbursements of counsel incurred by the Underwriters in
connection with the Directed Share Program and stamp duties, similar taxes or
duties or other taxes, if any, incurred by the Underwriters in connection with
the Directed Share Program; and (B) the Selling Shareholders agree to pay or
cause to be paid all of the expenses incident to the performance of their
obligations under this Agreement, including any fees, disbursements and expenses
of their respective counsel. It is understood, however, that except as provided
in this Section, Section 9 entitled "Indemnity and Contribution", and the last
paragraph of Section 11 below, the Underwriters will pay all of their costs and
expenses, including fees and disbursements of their counsel, stock transfer
taxes payable on resale of any of the Shares by them and any advertising
expenses connected with any offers they may make.
The provisions of this Section shall not supersede or otherwise affect any
agreement that the Sellers may otherwise have for the allocation of such
expenses among themselves.
9. Indemnity and Contribution.
--------------------------
(a) The Company and the Trust will jointly and severally indemnify and
hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of either Section 15 of the Securities Act
or Section 20 of the Securities Exchange Act of 1934, as amended (the
"EXCHANGE ACT"), from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or any amendment
thereof, any preliminary prospectus or the Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or
supplements thereto), or caused by any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, except insofar as such losses,
claims, damages or liabilities are caused by any such untrue statement or
omission or alleged untrue statement or omission based upon information
relating to any Underwriter furnished to the Company in writing by such
Underwriter through you expressly for use therein.
The Company and the Trust also jointly and severally agree to
indemnify and hold harmless Xxxxxx Xxxxxxx and each person, if any, who
controls Xxxxxx Xxxxxxx within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and
all losses, claims, damages, liabilities and judgments incurred as a result
of Xxxxxx Xxxxxxx'x participation as a "qualified independent underwriter"
- 23 -
within the meaning of Rule 2720 of the National Association of Securities
Dealers' Conduct Rules in connection with the offering of the Common Stock,
except for any losses, claims, damages, liabilities, and judgments
resulting from Xxxxxx Xxxxxxx'x, or such controlling person's, willful
misconduct.
The Company also agrees to indemnify and hold harmless Xxxxxx Xxxxxxx
and each person, if any, who controls Xxxxxx Xxxxxxx within the meaning of
either Section 15 of the Act, or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages, liabilities and judgments
incurred as a result of Xxxxxx Xxxxxxx'x participation as a "qualified
independent underwriter" within the meaning of Rule 2720 of the National
Association of Securities Dealers' Conduct Rules in connection with the
offering of the common stock, except for any losses, claims, damages,
liabilities and judgments resulting from Xxxxxx Xxxxxxx'x, or such
controlling person's, willful misconduct.
(b) Each Selling Shareholder agrees, severally and not jointly, to
indemnify and hold harmless each Underwriter, the Company, its directors,
its officers who sign the Registration Statement and each person, if any,
who controls the Company within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and
all losses, claims, damages and liabilities (including, without limitation,
any legal or other expenses reasonably incurred in connection with
defending or investigating any such action or claim) caused by any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereof, any preliminary prospectus
or the Prospectus (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto), or caused by any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, but in
each case only with respect to information relating to each of the H&F
Sellers, Squam and Sunapee furnished in writing by or on behalf of any of
each of the H&F Sellers, Squam and Sunapee, respectively, expressly for use
in the Registration Statement, any preliminary prospectus, the Prospectus
or any amendments or supplements thereto. In no event shall the liability
of any Selling Shareholder for indemnification under this Section 9(b)
exceed the proceeds, net of underwriting discounts and commissions,
received by such Selling Shareholder in the Offering. This indemnity
obligation will be in addition to any liability which the Selling
Shareholders may otherwise have, but in no event will any Selling
Shareholder's total liability under this Section 9(b) exceed the proceeds,
net of underwriting discounts and commissions, received by such Selling
Shareholder in the Offering.
(c) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, the Selling Shareholders, the directors of
the Company, the officers of the Company who sign the Registration
Statement and each person, if any, who controls the Company or any Selling
Shareholder within the meaning of either
- 24 -
Section 15 of the Securities Act or Section 20 of the Exchange Act from and
against any and all losses, claims, damages and liabilities (including,
without limitation, any legal or other expenses reasonably incurred in
connection with defending or investigating any such action or claim) caused
by any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or any amendment thereof, any
preliminary prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), or
caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein
not misleading, but only with reference to information relating to such
Underwriter furnished to the Company or the Trust in writing by such
Underwriter through you expressly for use in the Registration Statement,
any preliminary prospectus, the Prospectus or any amendments or supplements
thereto.
(d) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may
be sought pursuant to Section 9(a), 9(b) or 9(c), such person (the
"INDEMNIFIED PARTY") shall promptly notify the person against whom such
indemnity may be sought (the "INDEMNIFYING PARTY") in writing and the
indemnifying party, upon request of the indemnified party, shall retain
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in
such proceeding and shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any indemnified party
shall have the right to retain its own counsel, but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless
(i) the indemnifying party and the indemnified party shall have mutually
agreed to the retention of such counsel or (ii) the named parties to any
such proceeding (including any impleaded parties) include both the
indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings
in the same jurisdiction, be liable for (i) the fees and expenses of more
than one separate firm (in addition to any local counsel) for all
Underwriters and all persons, if any, who control any Underwriter within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act, (ii) the fees and expenses of more than one separate firm (in
addition to any local counsel) for the Company, its directors, its officers
who sign the Registration Statement and each person, if any, who controls
the Company within the meaning of either such Section and (iii) the fees
and expenses of more than one separate firm (in addition to any local
counsel) for all Selling Shareholders and all persons, if any, who control
any Selling Shareholder within the meaning of either such Section, and that
all such fees and expenses shall be reimbursed as they are incurred. In
the case of any such separate firm for the Underwriters and such control
persons of any Underwriters, such firm shall be designated in writing by
Xxxxxx Xxxxxxx & Co. Incorporated. In the case of any such separate firm
for the Company, and such directors, officers and control persons of the
Company, such
- 25 -
firm shall be designated in writing by the Company. In the case of any such
separate firm for the Selling Shareholders and such control persons of any
Selling Shareholders, such firm shall be designated in writing by the
persons named as attorneys-in-fact for the Selling Shareholders under the
Powers of Attorney. The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or
judgment. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been
a party and indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter
of such proceeding. Notwithstanding anything contained herein to the
contrary, if indemnity may be sought pursuant to Section 10 hereof in
respect of such action or proceeding, then in addition to such separate
firm for the indemnified parties, the indemnifying party shall be liable
for the reasonable fees and expenses of not more than one separate firm (in
addition to any local counsel) for Xxxxxxx Xxxxx Xxxxxx Inc., the
directors, officers, employees and agents of Xxxxxxx Xxxxx Barney Inc., and
all persons, if any, who control Xxxxxxx Xxxxx Xxxxxx Inc. within the
meaning of either the Act or the Exchange Act for the defense of any
losses, claims, damages and liabilities arising out of the Directed Share
Program. Notwithstanding anything contained herein to the contrary, if
indemnity may be sought pursuant to Section 9(a) hereof in respect of such
action or proceeding, then in addition to such separate firm for the
indemnified parties, the indemnifying party shall be liable for the
reasonable fees and expenses of not more than one separate firm (in
addition to any local counsel) for Xxxxxx Xxxxxxx in its capacity as
"qualified independent underwriter" and all persons, if any, who control
Xxxxxx Xxxxxxx within the meaning of either Section 15 of the Act or
Section 20 of the Exchange Act.
(e) To the extent the indemnification provided for in Section 9(a),
9(b) or 9(c) is unavailable to an indemnified party or insufficient in
respect of any losses, claims, damages or liabilities referred to therein,
then each indemnifying party under such paragraph, in lieu of indemnifying
such indemnified party thereunder, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect
the relative benefits received by the indemnifying party or parties on the
one hand and the indemnified party or parties on the other hand from the
offering of the Shares or (ii) if the allocation provided by clause 9(e)(i)
above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
9(e)(i) above but also the relative fault of the indemnifying party or
parties on the one hand and of the indemnified party or parties on the
other hand in connection with the statements or omissions that resulted in
such losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the
- 26 -
Sellers on the one hand and the Underwriters on the other hand in
connection with the offering of the Shares shall be deemed to be in the
same respective proportions as the net proceeds from the offering of the
Shares (before deducting expenses) received by each Seller and the total
underwriting discounts and commissions received by the Underwriters, in
each case as set forth in the table on the cover of the Prospectus, bear to
the aggregate Public Offering Price of the Shares. The relative fault of
the Sellers 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
Sellers or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement
or omission. The Underwriters' respective obligations to contribute
pursuant to this Section 9 are several in proportion to the respective
number of Shares they have purchased hereunder, and not joint.
(f) The Sellers and the Underwriters agree that it would not be just
or equitable if contribution pursuant to this Section 9 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 in Section 9(e). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or
claim. Notwithstanding the provisions of this Section 9, 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 Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
remedies provided for in this Section 9 are not exclusive and shall not
limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
(g) The indemnity and contribution provisions contained in this
Section 9 and the representations, warranties and other statements of the
Company and the Selling Shareholders contained in this Agreement shall
remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf
of any Underwriter or any person controlling any Underwriter, any Selling
Shareholder or any person controlling any Selling Shareholder, or the
Company, its officers or directors or any person controlling the Company
and (iii) acceptance of and payment for any of the Shares.
- 27 -
10. Directed Share Program Indemnification.
--------------------------------------
(a) The Company agrees to indemnify and hold harmless Xxxxxxx Xxxxx
Barney Inc. and its affiliates and each person, if any, who controls
Xxxxxxx Xxxxx Xxxxxx Inc. or its affiliates within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act
("Xxxxxxx Xxxxx Barney Inc. Entities"), from and against any and all
losses, claims, damages and liabilities (including, without limitation, any
legal or other expenses reasonably incurred in connection with defending or
investigating any such action or claim) (i) caused by any untrue statement
or alleged untrue statement of a material fact contained in any material
prepared by or with the consent of the Company for distribution to
Participants in connection with the Directed Share Program, or caused by
any omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading; (ii) caused by the failure of any Participant to pay for and
accept delivery of Directed Shares that the Participant has agreed to
purchase; or (iii) related to, arising out of, or in connection with the
Directed Share Program other than losses, claims, damages or liabilities
(or expenses relating thereto) that are finally judicially determined to
have resulted from the bad faith or gross negligence of Xxxxxxx Xxxxx
Xxxxxx Inc. Entities.
(b) In case any proceeding (including any governmental investigation)
shall be instituted involving any Xxxxxxx Xxxxx Barney Inc. Entity in
respect of which indemnity may be sought pursuant to Section 10(a), the
Xxxxxxx Xxxxx Xxxxxx Inc. Entity seeking indemnity shall promptly notify
the Company in writing and the Company, upon request of the Xxxxxxx Xxxxx
Barney Inc. Entity, shall retain counsel reasonably satisfactory to the
Xxxxxxx Xxxxx Xxxxxx Inc. Entity to represent the Xxxxxxx Xxxxx Barney Inc.
Entity and any other the Company may designate in such proceeding and shall
pay the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any Xxxxxxx Xxxxx Xxxxxx Inc. Entity shall have the
right to retain its own counsel, but the fees and expenses of such counsel
shall be at the expense of such Xxxxxxx Xxxxx Barney Inc. Entity unless (i)
the Company shall have agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties)
include both the Company and the Xxxxxxx Xxxxx Xxxxxx Inc. Entity and
representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. The Company
shall not, in respect of the legal expenses of the Xxxxxxx Xxxxx Barney
Inc. Entities in connection with any proceeding or related proceedings the
same jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Xxxxxxx Xxxxx
Xxxxxx Inc. Entities. Any such firm for the Xxxxxxx Xxxxx Barney Inc.
Entities shall be designated in writing by Xxxxxxx Xxxxx Xxxxxx Inc. The
Company shall not be liable for any settlement of any proceeding effected
without its written consent, but if settled with such consent or if there
be a final judgment for the plaintiff, the Company agrees to indemnify the
Xxxxxxx Xxxxx Barney Inc. Entities from and against any loss or liability
by reason of such settlement or judgment. The Company
- 28 -
shall not, without the prior written consent of Xxxxxxx Xxxxx Xxxxxx Inc.,
effect any settlement of any pending or threatened proceeding in respect of
which any Xxxxxxx Xxxxx Barney Inc. Entity is or could have been a party
and indemnity could have been sought hereunder by such Xxxxxxx Xxxxx Xxxxxx
Inc. Entity, unless such settlement includes an unconditional release of
the Xxxxxxx Xxxxx Barney Inc. Entities from all liability on claims that
are the subject matter of such proceeding.
(c) To the extent the indemnification provided for in Section 10(a) is
unavailable to a Xxxxxxx Xxxxx Xxxxxx Inc. Entity or insufficient in
respect of any losses, claims, damages or liabilities referred to therein,
then the Company, in lieu of indemnifying the Xxxxxxx Xxxxx Barney Inc.
Entity thereunder, shall contribute to the amount paid or payable by the
Xxxxxxx Xxxxx Xxxxxx Inc. Entity as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect
the relative benefits received by the Company on the one hand and the
Xxxxxxx Xxxxx Barney Inc. Entities on the other hand from the offering of
the Directed Shares or (ii) if the allocation provided by clause 10(c)(i)
above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
10(c)(i) above but also the relative fault of the Company on the one hand
and of the Xxxxxxx Xxxxx Xxxxxx Inc. Entities on the other hand in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one
hand and of the Xxxxxxx Xxxxx Barney Inc. Entities on the other hand in
connection with the offering of the Directed Shares shall be deemed to be
in the same respective proportions as the net proceeds from the offering of
the Directed Shares (before deducting expenses) and the total underwriting
discounts and commissions received by the Xxxxxxx Xxxxx Xxxxxx Inc.
Entities for the Directed Shares, bear to the aggregate Public Offering
Price of the Shares. If the loss, claim, damage or liability is caused by
an untrue or alleged untrue statement of a material fact, the relative
fault of the Company on the one hand and the Xxxxxxx Xxxxx Barney Inc.
Entities on the other hand shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement or the omission or
alleged omission relates to information supplied by the Company or by the
Xxxxxxx Xxxxx Xxxxxx Inc. Entities and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(d) The Company and the Xxxxxxx Xxxxx Barney Inc. Entities agree that
it would not be just or equitable if contribution pursuant to this Section
10 were determined by pro rata allocation (even if the Xxxxxxx Xxxxx Xxxxxx
Inc. Entities 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 in Section 10(c). The amount paid or payable by
the Xxxxxxx Xxxxx Barney Inc. Entities as a result of the losses, claims,
damages and liabilities referred to in the immediately preceding paragraph
shall be deemed to include, subject to the limitations set forth above, any
legal or other expenses
- 29 -
reasonably incurred by the Xxxxxxx Xxxxx Xxxxxx Inc. Entities in connection
with investigating or defending any such action or claim. Notwithstanding
the provisions of this Section 10, no Xxxxxxx Xxxxx Barney Inc. Entity
shall be required to contribute any amount in excess of the amount by which
the total price at which the Directed Shares distributed to the public were
offered to the public exceeds the amount of any damages that such Xxxxxxx
Xxxxx Xxxxxx Inc. Entity has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission.
The remedies provided for in this Section 10 are not exclusive and shall
not limit any rights or remedies which may otherwise be available to any
Xxxxxxx Xxxxx Barney Inc. Entity at law or in equity.
(e) The indemnity and contribution provisions contained in this
Section 10 shall remain operative and in full force and effect regardless
of (i) any termination of this Agreement, (ii) any investigation made by or
on behalf of any Xxxxxxx Xxxxx Xxxxxx Inc. Entity or the Company, its
officers or directors or any person controlling the Company and (iii)
acceptance of and payment for any of the Directed Shares.
11. Termination. This Agreement shall be subject to termination by notice
-----------
given by you to the Company or the Trust, if (a) after the execution and
delivery of this Agreement and prior to the Closing Date (i) trading generally
shall have been suspended or materially limited on or by, as the case may be,
any of the New York Stock Exchange, the American Stock Exchange, the National
Association of Securities Dealers, Inc., the Chicago Board of Options Exchange,
the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii) trading of
any securities of the Company shall have been suspended on any exchange or in
any over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities or (iv) there shall have occurred any outbreak or escalation
of hostilities or any change in financial markets or any calamity or crisis
that, in your judgment, is material and adverse and (b) in the case of any of
the events specified in clauses 10(a)(i) through 10(a)(iv), such event, singly
or together with any other such event, makes it, in your judgment, impracticable
to market the Shares on the terms and in the manner contemplated in the
Prospectus.
12. Effectiveness; Defaulting Underwriters. This Agreement shall become
--------------------------------------
effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date or the Option Closing Date, as the case may be, any
one or more of the Underwriters shall fail or refuse to purchase Shares that it
has or they have agreed to purchase hereunder on such date, and the aggregate
number of Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase is not more than one-tenth of the aggregate number
of the Shares to be purchased on such date, the other Underwriters shall be
obligated severally in the proportions that the number of Firm Shares set forth
opposite their respective names in Schedule II bears to the aggregate number of
Firm Shares set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as you may
- 30 -
specify, to purchase the Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date; provided
that in no event shall the number of Shares that any Underwriter has agreed to
purchase pursuant to this Agreement be increased pursuant to this Section 12 by
an amount in excess of one-ninth of such number of Shares without the written
consent of such Underwriter. If, on the Closing Date, any Underwriter or
Underwriters shall fail or refuse to purchase Firm Shares and the aggregate
number of Firm Shares with respect to which such default occurs is more than
one-tenth of the aggregate number of Firm Shares to be purchased, and
arrangements satisfactory to you, the Company and the Selling Shareholders for
the purchase of such Firm Shares are not made within 36 hours after such
default, this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter, the Company or the Selling Shareholders. In any such
case either you or the relevant Sellers shall have the right to postpone the
Closing Date, but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement and in the Prospectus or
in any other documents or arrangements may be effected. If, on the Option
Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase
Additional Shares and the aggregate number of Additional Shares with respect to
which such default occurs is more than one-tenth of the aggregate number of
Additional Shares to be purchased, the non-defaulting Underwriters shall have
the option to (i) terminate their obligation hereunder to purchase Additional
Shares or (ii) purchase not less than the number of Additional Shares that such
non-defaulting Underwriters would have been obligated to purchase in the absence
of such default. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them,
because of any failure or refusal on the part of any Seller to comply with the
terms or to fulfill any of the conditions of this Agreement, or if for any
reason any Seller shall be unable to perform its obligations under this
Agreement, the Sellers will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
13. Counterparts. This Agreement may be signed in two or more counterparts,
------------
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
14. Applicable Law. This Agreement shall be governed by and construed in
--------------
accordance with the internal laws of the State of New York.
15. Headings. The headings of the sections of this Agreement have been
--------
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
- 31 -
Very truly yours,
DIGITAS INC.
By:
----------------------------------
Name:
Title:
XXXXXXX XXXXXXXX XXXXXXXX CO.
By:
----------------------------------
Name:
Title:
The Selling Shareholders
named in Schedule I hereto,
acting severally
By:
----------------------------------
Attorney-in-Fact
Accepted as of the date hereof
Xxxxxx Xxxxxxx & Co. Incorporated
Deutsche Banc Alex. Xxxxx
Xxxxxxx Xxxxx Xxxxxx
Banc of America Securities LLC
Bear, Xxxxxxx & Co. Inc.
Acting severally on behalf
of themselves and the
several Underwriters named
in Schedule II hereto.
By: Xxxxxx Xxxxxxx & Co. Incorporated
By:
-----------------------------
Name:
Title:
- 32 -
SCHEDULE I
NUMBER OF
FIRM SHARES
SELLING SHAREHOLDER TO BE SOLD
Xxxxxxx & Xxxxxxxx Capital Partners III, L.P.
H&F Orchard Partners III, L.P.
H&F International Partners III, L.P.
Squam Lake Investors, III L.P.
Sunapee Securities, Inc.
-------------
Total ........
=============
- 33 -
SCHEDULE II
NUMBER OF
FIRM SHARES
UNDERWRITER TO BE PURCHASED
Xxxxxx Xxxxxxx & Co. Incorporated
Deutsche Banc Alex. Xxxxx
Xxxxxxx Xxxxx Xxxxxx
Banc of America Securities LLC
Bear, Xxxxxxx & Co. Inc.
[NAMES OF OTHER UNDERWRITERS]
-------------
Total ........
=============
- 34 -
EXHIBIT A
[FORM OF LOCK-UP LETTER]
____________, 1999
Xxxxxx Xxxxxxx & Co. Incorporated
Deutsche Banc Alex. Xxxxx
Xxxxxxx Xxxxx Xxxxxx
Banc of America Securities LLC
Bear, Xxxxxxx & Co. Inc.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
The undersigned understands that Xxxxxx Xxxxxxx & Co. Incorporated ("XXXXXX
XXXXXXX") proposes to enter into an Underwriting Agreement (the "UNDERWRITING
AGREEMENT") with Bronnercom Inc., a Delaware corporation (the "COMPANY"),
providing for the public offering (the "PUBLIC OFFERING") by the several
Underwriters, including Xxxxxx Xxxxxxx (the "UNDERWRITERS"), of ___ shares (the
"SHARES") of the Common Stock $0.01 par value per share of the Company (the
"COMMON STOCK").
To induce the Underwriters that may participate in the Public Offering to
continue their efforts in connection with the Public Offering, the undersigned
hereby agrees that, without the prior written consent of Xxxxxx Xxxxxxx on
behalf of the Underwriters, it will not, during the period commencing on the
date hereof and ending 180 days after the date of the final prospectus relating
to the Public Offering (the "PROSPECTUS"), (1) offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase, lend, or otherwise
transfer or dispose of, directly or indirectly, any shares of Common Stock or
any securities convertible into or exercisable or exchangeable for Common Stock,
or (2) enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of the Common
Stock, whether any such transaction described in clause (1) or (2) above is to
be settled by delivery of Common Stock or such other securities, in cash or
otherwise. The foregoing sentence shall not apply to (a) the sale of any Shares
to the Underwriters pursuant to the Underwriting Agreement or (b) transactions
relating to shares of Common Stock or other securities acquired in open market
transactions after
- 35 -
the completion of the Public Offering. In addition, the undersigned agrees that,
without the prior written consent of Xxxxxx Xxxxxxx on behalf of the
Underwriters, it will not, during the period commencing on the date hereof and
ending 180 days after the date of the Prospectus, make any demand for or
exercise any right with respect to, the registration of any shares of Common
Stock or any security convertible into or exercisable or exchangeable for Common
Stock.
Whether or not the Public Offering actually occurs depends on a number of
factors, including market conditions. Any Public Offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.
Very truly yours,
_________________________
(Name)
_________________________
(Address)
- 36 -
