2,500,000 Shares
THE NORTH FACE, INC.
Common Stock
UNDERWRITING AGREEMENT
November __, 1996
Alex. Xxxxx & Sons Incorporated
Xxxxxxxxx & Xxxxx LLC
X.X. Xxxxxx Securities Inc.
As Representatives of the
Several Underwriters
c/o Alex. Xxxxx & Sons Incorporated
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Ladies and Gentlemen:
The North Face, Inc., a Delaware corporation (the "Company"), proposes
to sell to the several underwriters (the "Underwriters") named in Schedule I
hereto for whom you are acting as representatives (the "Representatives") an
aggregate of 1,000,000 shares of the Company's Common Stock, $0.0025 par
value (the "Common Stock"), and the selling stockholders of the Company named
in Schedule II hereto (each, a "Selling Stockholder and together, the
"Selling Stockholders") propose to sell to the Underwriters an aggregate of
1,500,000 shares of Common Stock (the "Firm Shares"). The respective amounts
of the Firm Shares to be so purchased by the several Underwriters are set
forth opposite their names in Schedule I hereto, and the respective amounts
to be sold by each of the Selling Stockholders are set forth opposite their
names in Schedule II hereto. Certain of the Selling Stockholders named in
Schedule III also propose to sell at the Underwriters' option an aggregate of
up to 375,000 additional shares of the Company's Common Stock (the "Option
Shares"). The Company and the Selling Stockholders are sometimes referred to
herein collectively as the "Sellers."
As the Representatives, you have advised the Company and the Selling
Stockholders (a) that you are authorized to enter into this Agreement on behalf
of the several Underwriters, and (b) that the several Underwriters are willing,
acting severally and not jointly, to purchase the numbers of Firm Shares set
forth opposite their respective names in Schedule I, plus their pro rata portion
of the Option Shares if you elect to exercise the over-allotment option in whole
or in part for the accounts of the several Underwriters. The Firm Shares and the
Option Shares (to the extent the aforementioned option is exercised) are herein
collectively called the "Shares."
1.
In consideration of the mutual agreements contained herein and of the
interests of the parties in the transactions contemplated hereby, the parties
hereto agree as follows:
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
(a) The Company represents and warrants as follows:
(i) A registration statement on Form S-1 (File No. 333-
________) with respect to the Shares has been prepared by the Company in
conformity with the requirements of the Securities Act of 1933, as amended (the
"Act") and the Rules and Regulations (the "Rules and Regulations") of the
Securities and Exchange Commission (the "Commission") thereunder and has been
filed with the Commission under the Act. Copies of such registration statement,
including any amendments thereto, the preliminary prospectuses (meeting the
requirements of Rule 430A of the Rules and Regulations) contained therein, the
exhibits, financial statements and schedules, as finally amended and revised,
and any abbreviated registration statement filed pursuant to Rule 462(b) of the
Rules and Regulations (a "462(b) Registration Statement"), have heretofore been
delivered by the Company to you. Such registration statement, including any
462(b) Registration Statement, herein referred to as the "Registration
Statement," which shall be deemed to include all information omitted therefrom
in reliance upon Rule 430A and contained in the Prospectus referred to below,
has been declared effective by the Commission under the Act and no post-
effective amendment to the Registration Statement has been filed as of the date
of this Agreement. The form of prospectus first filed by the Company with the
Commission pursuant to its Rule 424(b) and Rule 430A is herein referred to as
the "Prospectus." Each preliminary prospectus included in the Registration
Statement prior to the time it becomes effective is herein referred to as a
"Preliminary Prospectus." Any reference herein to any Prospectus shall be deemed
to include any supplements or amendments thereto, filed with the Commission
after the date of filing of the Prospectus under Rules 424(b) and 430A, and
prior to the termination of the offering of the Shares by the Underwriters.
(ii) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with corporate power and authority to own its properties and conduct
its business as described in the Registration Statement; each of the
subsidiaries of the Company as listed in Exhibit 21.1 to Item 16(a) of the
Registration Statement (collectively, the "Subsidiaries") has been duly
organized and is validly existing as a corporation in good standing or has such
other comparable status under the laws of the jurisdiction of its incorporation,
with corporate power and authority to own or lease its properties and conduct
its business as described in the Registration Statement; the Company and each of
the Subsidiaries are duly qualified to transact business in all jurisdictions in
which the conduct of their business requires such qualification, except where
the failure to be qualified would not have a material adverse effect on the
condition (financial or otherwise), business, results of operations or prospects
of the Company or the Subsidiaries; the outstanding shares of capital stock of
each of the Subsidiaries have been duly authorized and validly issued, are fully
paid and non-assessable and, except as set forth in the Registration Statement,
are owned by the Company free and clear of all liens, encumbrances and security
interests; and no options, warrants or other rights to purchase, agreements or
other obligations to issue or other rights to
2.
convert any obligations into shares of capital stock or ownership interests in
the Subsidiaries are outstanding.
(iii) The outstanding shares of Common Stock of the Company have
been duly authorized and validly issued and are fully paid and non-assessable;
all Firm Shares and Option Shares to be sold by the Selling Stockholders have
been duly authorized and, as of the Closing Date or the Option Closing Date, as
the case may be, (as such dates are hereinafter defined) will be validly issued,
fully paid and non-assessable; the portion of the Firm Shares to be issued and
sold by the Company have been duly authorized for issuance and sale to the
Underwriters and when issued and paid for as contemplated herein will be validly
issued, fully paid and non-assessable; and no preemptive rights of stockholders
exist with respect to any of the Shares or the issue and sale thereof. Except as
disclosed in the Prospectus, there are no options to purchase from the Company,
nor any preemptive rights or other rights to subscribe for or to purchase from
the Company, any securities or obligations convertible into, or any contracts or
commitments by the Company to issue or sell, shares of the Company's capital
stock or any such options, rights or convertible securities or obligations.
(iv) The authorized and outstanding capital stock of the
Company and the Shares conform with the statements concerning them in the
Registration Statement and the Prospectus.
(v) The Commission has not issued an order preventing or
suspending the use of any Preliminary Prospectus relating to the proposed
offering of the Shares nor instituted proceedings for that purpose. The
Registration Statement contains and the Prospectus and any amendments or
supplements thereto will contain all statements which are required to be stated
therein by, and in all material respects conform or will conform, as the case
may be, to the requirements of, the Act and the Rules and Regulations. Neither
the Registration Statement nor any amendment thereto, and neither the Prospectus
nor any supplement thereto, contains or will contain, as the case may be, any
untrue statement of a material fact or omits or will omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
provided, however, that the Company makes no representations or warranties as to
information contained in or omitted from the Registration Statement or the
Prospectus, or any such amendment or supplement, in reliance upon, and in
conformity with, written information furnished to the Company by or on behalf of
any Underwriter through the Representatives, specifically for use in the
preparation thereof.
(vi) The consolidated financial statements of the Company and
the Subsidiaries, together with related notes and schedules as set forth in the
Registration Statement, other than the pro forma financial statements, present
fairly the consolidated financial position and results of operations of the
Company and Subsidiaries, at the indicated dates and for the indicated periods.
Such financial statements have been prepared in accordance with generally
accepted principles of accounting, consistently applied throughout the periods
involved, and all adjustments necessary for a fair presentation of results for
such periods have been made. The summary financial and statistical data and the
pro forma financial statements included in the
3.
Registration Statement present fairly the information shown therein and have
been compiled on a basis consistent with the financial statements presented
therein.
(vii) There is no action or proceeding pending or, to the
knowledge of the Company, threatened against the Company or any of the
Subsidiaries before any court or administrative agency which is expected to
result in any material adverse change in the business or condition of the
Company and of the Subsidiaries taken as a whole, except as set forth in the
Registration Statement.
(viii) The Company and the Subsidiaries have good and
marketable title to all of the properties and assets reflected in the financial
statements (or as described in the Registration Statement) hereinabove
described, subject to no lien, mortgage, pledge, charge or encumbrance of any
kind except those reflected in such financial statements (or as described in the
Registration Statement) or which are not material in amount. The Company and the
Subsidiaries occupy their leased properties under valid and binding leases
conforming to the description thereof set forth in the Registration Statement.
All real and personal property owned or leased by the Company and the
Subsidiaries (A) complies with applicable federal, state, local and foreign
statutes, rules, regulations, orders and laws and all covenants, conditions and
restrictions, (B) is free from known defects, (C) is in good condition and
repair (ordinary wear and tear excepted), and (D) is in a condition suitable for
the business of the Company and the Subsidiaries as it is currently being
conducted, except where the failure to be in such compliance, to be free from
such compliance, to be free from such defects and to be in such condition would
not have a material adverse effect on the condition (financial or otherwise),
business, results of operations or prospects of the Company or the Subsidiaries.
(ix) The Company and the Subsidiaries have filed all federal,
state and foreign income tax returns which have been required to be filed and
have paid all taxes indicated by said returns and all assessments received by
them or any of them to the extent that such taxes have become due, except such
taxes and assessments as are being contested in good faith, and the Company has
no knowledge of any tax deficiency which has been or might be asserted against
the Company or the Subsidiaries which might have a material adverse effect on
the condition (financial or otherwise), business, results of operations or
prospects of the Company or the Subsidiaries.
(x) Since the respective dates as of which information is
given in the Registration Statement, as it may be amended or supplemented, there
has not been any material adverse change or any development involving a
prospective material adverse change in or affecting the condition, financial or
otherwise, of the Company and its Subsidiaries taken as a whole or the earnings,
business affairs, management, or business prospects of the Company and its
Subsidiaries taken as a whole, whether or not occurring in the ordinary course
of business, and there has not been any material transaction entered into by the
Company or the Subsidiaries, other than transactions in the ordinary course of
business and changes and transactions contemplated by the Registration
Statement, as it may be amended or supplemented. The Company and the
Subsidiaries have no material contingent obligations which are not disclosed in
the Registration Statement, as it may be amended or supplemented.
4.
(xi) Neither the Company nor any of the Subsidiaries is (A)
in violation of its certificate of incorporation or bylaws or similar
instruments, (B) in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any bond,
debenture, note or other evidence of indebtedness or in any contract,
indenture, mortgage, loan agreement, joint venture or other agreement or
instrument to which the Company or any Subsidiary is a party or by which it
or any of its properties may be bound, or (C) in violation of any law, order,
rule, regulation, injunction or decree of any government, government
instrumentality or court, domestic or foreign, of which it has knowledge,
except, in the case of (B) and (C), where any such default or violation would
not have a material adverse effect on the condition (financial or otherwise),
business, results of operations or prospects of the Company.
(xii) The Company has full legal right, power and authority to
enter into this Agreement and perform the transactions contemplated hereby.
This Agreement has been duly authorized, executed and delivered by the
Company and is a valid and binding agreement on the part of the Company,
enforceable in accordance with its terms, except as rights to indemnity and
contribution hereunder may be limited by applicable law or equitable
principles, and except as the enforcement hereof may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally, or by general equitable principles;
the execution, delivery and performance of this Agreement and the
consummation of the transactions herein contemplated will not result in a
breach or violation of any of the terms and provisions of or constitute a
default under (A) the certificate of incorporation or bylaws of the Company,
(B) any indenture, mortgage, deed of trust, loan agreement, bond, debenture,
note agreement or other evidence of indebtedness, or any lease, contract or
other agreement or instrument to which the Company or any of its Subsidiaries
is a party or by which the property of the Company or any of its Subsidiaries
is bound, or (C) any law, order, rule, regulation, writ, injunction, judgment
or decree of any court or governmental agency or body having jurisdiction
over the Company or any of its Subsidiaries or over the properties of the
Company or any if its Subsidiaries; except, in the case of (B) and (C), where
any such default or violation would not have a material adverse effect on the
condition (financial or otherwise), business, results of operations or
prospects of the Company.
(xiii) Each approval, consent, order, authorization,
designation, declaration or filing by or with any regulatory, administrative or
other governmental body necessary in connection with the execution and delivery
by the Company of this Agreement and the consummation of the transactions herein
contemplated (except such additional steps as may be required by the National
Association of Securities Dealers, Inc. (the "NASD") or may be necessary to
qualify the Shares for public offering by the Underwriters under State
securities or Blue Sky laws) has been obtained or made and is in full force and
effect.
(xiv) The Company and each of the Subsidiaries holds all
material licenses, certificates and permits from governmental authorities which
are necessary to the conduct of their businesses; and neither the Company nor
any of the Subsidiaries has infringed any patents, patent rights, trade names,
trademarks, service marks, trade dress or copyrights of any third party, which
infringement is material to the business of the Company and the Subsidiaries
taken as a whole.
5.
(xv) Deloitte & Touche LLP, who have certified certain of the
financial statements filed with the Commission as part of the Registration
Statement, are independent public accountants as required by the Act and the
Rules and Regulations.
(xvi) There is no contract or document of the Company or any of
its Subsidiaries that is required to be described in the Prospectus or filed as
an exhibit to the Registration Statement by the Act or by the Rules and
Regulations which has not been accurately described in all material respects in
the Prospectus or filed as an exhibit.
(xvii) Each of the Company and the Subsidiaries is conducting
business in compliance with all applicable federal, state, local, and foreign
laws, rules and regulations of the jurisdictions in which it is conducting
business, including without limitation, all applicable federal, state, local and
foreign laws and regulations governing employee and labor matters (including
minimum wage, worker's compensation and related matters) and environmental
matters, except where the failure to be so in compliance would not have a
material adverse effect on the condition (financial or otherwise), business,
results of operations or prospects of the Company.
(xviii) Each of the Company and the Subsidiaries maintains
insurance of types and in amounts the Company deems adequate for their
businesses, including but not limited to, insurance covering real and personal
property owned or leased by the Company against theft, damage, destruction, acts
of vandalism and liability resulting from the sale of the Company's products and
all other risks customarily insured against, all of which insurance is in full
force and effect.
(xix) No labor disturbance by the employees of the Company or
any of the Subsidiaries exists or is imminent that might be expected to result
in any material adverse change in the condition (financial or otherwise),
business, results of operations or prospects of the Company.
(xx) Neither the Company nor any of the Subsidiaries has at any
time (A) made any contributions to any candidate for political office, or failed
to disclose fully any such contribution, in violation of applicable law or (B)
made any payment to any state, federal or foreign governmental officer or
official, or other person charged with similar public or quasi-public duties,
other than payments required or allowed by applicable law.
(xxi) The Common Stock has been approved for quotation on the
Nasdaq National Market, and The Company has timely filed a Notice of Listing of
Additional Shares with The Nasdaq Stock Market with respect to the Shares.
(xxii) The Company has not distributed and will not distribute
prior to the Closing Date or on any date on which Option Shares are to be
purchased, as the case may be, any offering material in connection with the
offering and sale of the Shares other than the Preliminary Prospectus, the
Prospectus, the Registration Statement and other materials permitted by the Act
and the Rules and Regulations.
6.
(xxiii) The Company has not taken and will not take, directly
or indirectly, any action designed to or that might be reasonably expected to
cause or result in stabilization or manipulation of the price of the Common
Stock to facilitate the sale or resale of the Shares.
(xxiv) The Company has not since the filing of the
Registration Statement, except in connection with the sale of the Shares of the
Company under this Agreement, (A) sold, bid for, purchased, attempted to induce
any person to purchase or paid anyone any compensation for soliciting purchases
of, the Shares or (B) paid or agreed to pay any person any compensation for
soliciting another to purchase any other securities of the Company.
(xxv) The Company is not, and will not on the Closing Date or
the Option Closing Date (as such dates are hereinafter defined) be, an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
(xxvi) The Company is not aware that (A) any executive, key
employee or significant group of employees of the Company or any Subsidiary
plans to terminate employment with the Company or such Subsidiary or (B) any
such executive or key employee is subject to a nondisclosure, noncompete,
confidentiality, employment, consulting or similar agreement that would be
violated by the present or proposed business activities of the Company or its
Subsidiaries.
(xxvii) Each of the Company and its Subsidiaries maintains a
system of internal accounting controls sufficient to provide reasonable
assurances that (A) transactions are executed in accordance with management's
general or specific authorization, (B) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally
accepted principles of accounting and to maintain accountability for assets,
(C) access to its assets is permitted only in accordance with management's
general or specific authorization and (D) the recorded accountability for
assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to differences.
(xxviii) The Company currently is not involved in any
discussions or negotiations with respect to any potential acquisition of any
third party or parties which, if consummated, would be required to be disclosed
in the Prospectus.
(b) Each of the Selling Stockholders severally represents and
warrants as follows:
(i) All consents, approvals, authorizations and orders
necessary for the execution and delivery by such Selling Stockholder of this
Agreement and the Power of Attorney (the "Power of Attorney") and the Custody
Agreement (the "Custody Agreement") hereinafter referred to, and for the sale
and delivery of the Shares to be sold by such Selling Stockholder hereunder,
have been obtained; and such Selling Stockholder has the full right, power and
authority to enter into this Agreement, the Power of Attorney and the Custody
7.
Agreement and to sell, assign, transfer and deliver the Shares to be sold such
Selling Stockholder.
(ii) This Agreement, the Custody Agreement and the Power of
Attorney have been duly authorized, executed and delivered by such Selling
Stockholder and are valid and binding agreements on the part of such Selling
Stockholder, enforceable in accordance with their respective terms, except as
rights to indemnity and contribution hereunder may be limited by applicable law
or equitable principles, and except as the enforcement hereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors' rights generally, or by general equitable principles;
the execution, delivery and performance of this Agreement, the Custody Agreement
and the Power of Attorney and the consummation of the transactions herein and
therein contemplated will not result in a breach or violation of any of the
terms and provisions of or constitute a default under (A) any indenture,
mortgage, deed of trust, loan agreement, bond, debenture, note agreement or
other evidence of indebtedness, or any lease, contract or other agreement,
instrument or organizational documents to which such Selling Stockholder is a
party or by which the property of such Selling Stockholder is bound, or (B) any
law, order, rule, regulation, writ, injunction, judgment or decree of any court
or governmental agency or body having jurisdiction over such Selling Stockholder
or over the properties of such Selling Stockholder; except where any such
default or violation would not have a material adverse effect on the condition
(financial or otherwise), business, results of operations or prospects of such
Selling Stockholder.
(iii) Such Selling Stockholder has and at the Closing Date and
the Option Closing Date, as the case may be (as such dates are hereinafter
defined), will have good and valid title to the Firm Shares and the Option
Shares to be sold by such Selling Stockholder, free of any liens, encumbrances,
equities and claims, and full right, power and authority to effect the sale and
delivery of such Firm Shares and Option Shares; and upon the delivery of and
payment for such Shares pursuant to this Agreement, good and valid title
thereto, free of any liens, encumbrances, equities and claims, will be
transferred to the several Underwriters.
(iv) The sale of the Shares to be sold by such Selling
Stockholder hereunder and the performance of this Agreement, the Power of
Attorney and the Custody Agreement and the consummation by such Selling
Stockholder of the transactions herein and therein contemplated and the
fulfillment by such Selling Stockholder of the terms hereof and thereof will not
result in a breach of any of the terms and provisions of, or constitute a
default under, any indenture, mortgage, deed of trust or other agreement or
instrument to which such Selling Stockholder is a party, or of any order, rule
or regulation applicable to such Selling Stockholder of any court or of any
regulatory body or administrative agency or other governmental body having
jurisdiction.
(v) Such Selling Stockholder has not taken and will not take,
directly or indirectly, any action designed to, or which has constituted, or
which might reasonably be expected to cause or result in stabilization or
manipulation of the price of the Common Stock.
8.
(vi) To the extent that any statement or omissions made in the
Registration Statement, any Preliminary Prospectus, the Propsectus, or any
amendment or supplement to any of the foregoing are made in reliance upon and in
conformity with written information furnished to the Company by such Selling
Stockholder expressly for use therein, such Preliminary Prospectus, at the time
of filing, conformed in all material respects with the requirements of the Act
and the Rules and Regulations, and the Registration Statement and the Prospectus
conform and any amendment sor supplements will conform, in all material respects
to the requirements of the Act and the Rules and Regulations.
(vii) Such Selling Stockholder is familiar with the
Registration Statement and has no knowledge of any material fact, condition
or information not disclosed in the Registration Statement which has
materially adversely affected or may materially adversely affect the business
of the Company or any of the Subsidiaries; and the sale of the Option Shares
by such Selling Stockholder pursuant hereto is not prompted by any
information concerning the Company or any of the Subsidiaries which is not
set forth in the Registration Statement.
(viii) Such Selling Stockholder has reviewed the
representations and warranties contained in Section 1(a) hereof and has no
reason to believe that the representations and warranties of the Company
contained in Section l(a) are not true and correct.
(ix) Such Selling Stockholder has reviewed each Preliminary
Prospectus, the Prospectus and the Registration Statement and has no reason
to believe that the Preliminary Prospectus, at the time of filing, did not
contain any untrue statement of material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and the Registration Statement and the Prospectus do not and will
not, as of the applicable effective date as to the Registration Statement and
any amendment thereto and as of the applicable filing date as to the
Prospectus and any amendment or supplement thereto, contain any untrue
statement of material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading;
provided, however, that the Selling Stockholder makes no representations or
warranties as to information contained in or omitted from the Registration
Statement or the Prospectus, or any such amendment or supplement, in reliance
upon, and in conformity with, written information furnished to the Company by
or on behalf of any Underwriter through the Representatives, specifically for
use in the preparation thereof.
(x) The Shares represented by certificates under the Custody
Agreement are subject to the interests of the Underwriters hereunder, and the
arrangements made by such Selling Stockholders for such custody, and the
appointment by such Selling Stockholder of the Attorneys-in-Fact by the Power of
Attorney, are to that extent, irrevocable. The obligations of any Selling
Stockholder hereunder shall not be terminated by operation of law, whether by
the dissolution of a partnership[, corporation or other entity] which is a
Selling Stockholder, by the death or incapacity of a Selling Stockholder or by
the occurrence of any other event. If any partnership, corporation or other
entity should be dissolved, or if any other event should occur, before the
delivery of the Shares hereunder, the Shares shall be delivered
9.
by or on behalf of such Selling Stockholder in accordance with the terms and
conditions of the Agreement and of the Custody Agreement, and such actions taken
by the Attorneys-in-Fact pursuant to the Power of Attorney shall be as valid as
if such dissolution, death, incapacity or other event had not occurred,
regardless of whether or not the Custodian, the Attorneys-in-Fact, or any of
them, hall have received notice of such death, incapacity, termination,
dissolution or other event.
2. PURCHASE, SALE AND DELIVERY OF THE SHARES. On the basis of the
representations, warranties and covenants herein contained, and subject to the
conditions herein set forth, the Company and Selling Stockholders agree to sell
to the Underwriters and each Underwriter agrees, severally and not jointly, to
purchase, at a price of $_____ per share, the number of Firm Shares set forth
opposite the name of each Underwriter in Schedule I hereof, subject to
adjustments in accordance with Section 9 hereof. The number of Firm Shares to
be purchased by each Underwriter from each Seller shall be as nearly as
practicable in the same proportion as the number of Firm Shares being purchased
by each Underwriter bears to the total number of Firm Shares to be sold
hereunder.
Certificates in negotiable form for the total number of the Shares to be
sold hereunder by the Selling Stockholders have been placed in custody with
American Stock Transfer & Trust Company, as custodian (the "Custodian")
pursuant to the Custody Agreement executed by each Selling Stockholder for
delivery of any Firm Shares and Option Shares to be sold hereunder by the
Selling Stockholders. Each of the Selling Stockholders specifically agrees
that any Firm Shares and Option Shares represented by the certificates held
in custody for the Selling Stockholders under the Custody Agreement are
subject to the interests of the Underwriters hereunder, that the arrangements
made by the Selling Stockholders for such custody are to that extent
irrevocable, and that the obligations of the Selling Stockholders hereunder
shall not be terminable by any act or deed of the Selling Stockholders (or by
any other person, firm or corporation including the Company, the Custodian or
the Underwriters) or by operation of law (including the death of an
individual Selling Stockholder or the dissolution of a partnership or
corporate Selling Stockholder) or by the occurrence of any other event or
events, except as set forth in the Custody Agreement. If any such event
should occur prior to the delivery to the Underwriters of the Firm Shares or
the Option Shares hereunder, certificates for the Firm Shares or the Option
Shares, as the case may be, shall be delivered by the Custodian in accordance
with the terms and conditions of this Agreement as if such event has not
occurred. The Custodian is authorized to receive and acknowledge receipt of
the proceeds of sale of the Shares held by it against delivery of such Shares.
Payment for the Firm Shares to be sold hereunder by Company is to be
made to the order of the Company to an account of the Company designated by
notice to the Representatives at least two (2) business days prior to the
Closing Date, and payment for the shares to be sold hereunder by the Selling
Stockholders is to be made to the order of the Custodian for the account of the
Selling Stockholders, in each case in New York Clearing House funds by wire
transfer or certified or bank cashier's checks against delivery of certificates
therefor to the Representatives for the several accounts of the Underwriters
(including without
10.
limitation by "full-fast" electronic transfer by Depository Trust Company). Such
payment and delivery are to be made at the offices of Alex. Xxxxx & Sons
Incorporated, 000 Xxxx Xxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx, at 10:00 a.m.,
Baltimore time, on the fifth business day after the date of this Agreement or at
such other time, date or place not later than five business days thereafter as
you and the Company shall agree upon, such time and date being herein referred
to as the "Closing Date." (As used herein, "business day" means a day on which
the New York Stock Exchange is open for trading and on which banks in New York
are open for business and not permitted by law or executive order to be closed.)
The certificates for the Firm Shares will be delivered in such denominations and
in such registrations as the Representatives request in writing not later than
the third full business day prior to the Closing Date, and will be made
available for inspection by the Representatives at least one business day prior
to the Closing Date.
In addition, on the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, certain of
the Selling Stockholders named in Schedule III hereto hereby grant an option to
the several Underwriters to purchase the Option Shares at the price per share as
set forth in the first paragraph of this Section 2. The maximum number of
Option Shares to be sold by the Selling Stockholders is set forth opposite their
respective names on Schedule III hereto. The option granted hereby may be
exercised in whole or in part, but only once, and at any time upon written
notice given within 30 days after the date of this Agreement, by you, as
Representatives of the several Underwriters, to the Company, the Custodian and
to each of the Selling Stockholders setting forth the number of the Option
Shares as to which the several Underwriters are exercising the option, the names
and denominations in which the Option Shares are to be registered and the time
and date at which such certificates are to be delivered. If the option granted
hereby is exercised in part, the respective number of Option Shares to be sold
by each of the Selling Stockholders listed on Schedule III hereto shall be
determined on a pro rata basis in accordance with the percentages set forth
opposite their names on Schedule III hereto, adjusted by you in such manner as
to avoid fractional shares. The time and date at which certificates for Option
Shares are to be delivered shall be determined by the Representatives but shall
not be earlier than three (3) nor later than ten (10) full business days after
the exercise of such option, nor in any event prior to the Closing Date (such
time and date being herein referred to as the "Option Closing Date"). If the
date of exercise of the option is three or more days before the Closing Date,
the notice of exercise shall set the Closing Date as the Option Closing Date.
The number of Option Shares to be purchased by each Underwriter shall be in the
same proportion to the total number of Option Shares being purchased as the
number of Firm Shares being purchased by such Underwriter bears to 2,500,000,
adjusted by you in such manner as to avoid fractional shares. The option with
respect to the Option Shares granted hereunder may be exercised only to cover
over-allotments in the sale of the Firm Shares by the Underwriters. You, as
Representatives of the several Underwriters, may cancel such option at any time
prior to its expiration by giving written notice of such cancellation to the
Company. To the extent, if any, that the option is exercised, payment for the
Option Shares shall be made on the Option Closing Date in New York Clearing
House funds by certified or bank cashier's check drawn to the order of the each
of the Selling Stockholders for the shares to be sold by the Selling
Stockholders, in each case against delivery of certificates therefor (including
without limitation by "full-fast" electronic transfer by
11.
Depository Trust Company) at the offices of Alex. Xxxxx & Sons Incorporated, 000
Xxxx Xxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx.
3. OFFERING BY THE UNDERWRITERS. It is understood that the several
Underwriters are to make a public offering of the Firm Shares as soon as the
Representatives deem it advisable to do so. The Firm Shares are to be initially
offered to the public at the initial public offering price set forth in the
Prospectus. The Representatives may from time to time thereafter change the
public offering price and other selling terms. To the extent, if at all, that
any Option Shares are purchased pursuant to Section 2 hereof, the Underwriters
will offer them to the public on the foregoing terms.
It is further understood that you will act as the Representatives for
the Underwriters in the offering and sale of the Shares in accordance with a
Master Agreement Among Underwriters entered into by you and the several other
Underwriters.
4. COVENANTS OF THE COMPANY AND THE SELLING STOCKHOLDERS.
(a) The Company covenants and agrees with the several Underwriters
and the Selling Stockholders that:
(i) The Company will (A) prepare and timely file with the
Commission under Rule 424(b) of the Rules and Regulations a Prospectus
containing information previously omitted at the time of effectiveness of the
Registration Statement in reliance on Rule 430A of the Rules and Regulations,
(B) not file any amendment to the Registration Statement or supplement to the
Prospectus of which the Representatives shall not previously have been advised
and furnished with a copy or to which the Representatives shall have reasonably
objected in writing or which is not in compliance with the Rules and Regulations
and (C) file on a timely basis all reports and any definitive proxy or
information statements required to be filed by the Company with the Commission
subsequent to the date of the Prospectus and prior to the termination of the
offering of the Shares by the Underwriters.
(ii) The Company will advise the Representatives promptly of
any request by the Commission for amendment of the Registration Statement or for
supplement to the Prospectus or for any additional information, or of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or the use of the Prospectus or of the institution of any
proceedings for that purpose, and the Company will use its best efforts to
prevent the issuance of any such stop order preventing or suspending the use of
the Prospectus and to obtain as soon as possible the lifting thereof, if issued.
(iii) The Company will cooperate with the Representatives in
endeavoring to qualify the Shares for sale under the securities laws of such
jurisdictions as the Representatives may reasonably have designated in writing
and will make such applications, file such documents, and furnish such
information as may be reasonably required for that purpose, provided the Company
shall not be required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction where it is not now so
qualified or
12.
required to file such a consent. The Company will, from time to time, prepare
and file such statements, reports, and other documents, as are or may be
required to continue such qualifications in effect for so long as the
Representatives may reasonably request for distribution of the Shares.
(iv) The Company will deliver to, or upon the order of, the
Representatives, from time to time, as many copies of any Preliminary Prospectus
as the Representatives may reasonably request. The Company will deliver to, or
upon the order of, the Representatives during the period when delivery of a
Prospectus is required under the Act, as many copies of the Prospectus in final
form, or as thereafter amended or supplemented, as the Representatives may
reasonably request. The Company will deliver to the Representatives at or before
the Closing Date four signed copies of the Registration Statement and all
amendments thereto including all exhibits filed therewith, and will deliver to
the Representatives such number of copies of the Registration Statement, but
without exhibits, and of all amendments thereto, as the Representatives may
reasonably request.
(v) If during the period in which a prospectus is required by
law to be delivered by an Underwriter or dealer any event shall occur as a
result of which, in the judgment of the Company or in the opinion of counsel for
the Underwriters, it becomes necessary to amend or supplement the Prospectus in
order to make the statements therein, in the light of the circumstances existing
at the time the Prospectus is delivered to a purchaser, not misleading, or, if
it is necessary at any time to amend or supplement the Prospectus to comply with
any law, the Company promptly will prepare and file with the Commission an
appropriate amendment to the Registration Statement or supplement to the
Prospectus so that the Prospectus as so amended or supplemented will not, in the
light of the circumstances when it is so delivered, be misleading, or so that
the Prospectus will comply with such law.
(vi) As soon as practicable, but no later than the
Availability Date (as defined below), the Company will make generally available
to its security holders earnings statements (which need not be audited) in
reasonable detail covering a period of at least 12 months beginning after the
effective date of the Registration Statement which will satisfy the provisions
of Section 11(a) of the Act and Rule 158 of the Rules and Regulations. For the
purpose of the preceding sentence, "Availability Date" means the 45th day after
the end of the fourth fiscal quarter following the fiscal quarter that includes
the effective date of the Registration Statement.
(vii) The Company will, for a period of five years from the
Closing Date, deliver to the Representatives copies of annual reports and copies
of all other documents, reports and information furnished by the Company to its
stockholders or filed with any securities exchange pursuant to the requirements
of such exchange or with the Commission pursuant to the Act or the Securities
Exchange Act of 1934, as amended.
(viii) No offering, sale or other disposition of any Common
Stock of the Company will be made for a period of 90 days after the date of this
Agreement, directly or indirectly, by the Company otherwise than hereunder or
with the prior written consent of the
13.
Representatives except that the Company may, without such consent, issue
shares (i) upon the exercise of options granted pursuant to the 1994 Stock
Incentive Plan, the 1995 Stock Incentive Plan, the 1996 Stock Incentive Plan
and the 1996 Directors' Stock Option Plan, and (ii) under the 1996 Employee
Stock Purchase Plan.
(ix) The Company will use its best efforts to maintain approval
for quotation of the Shares on the Nasdaq National Market.
(x) The Company will use the net proceeds received from the
sale of the Shares by the Company substantially as set forth in the Registration
Statement and the Prospectus.
(b) Each of the Selling Stockholders covenants and agrees with the
several Underwriters and the Company that:
(i) No offering, sale or other disposition of any Common
Stock of the Company will be made for a period of 90 days after the date of
this Agreement, directly or indirectly, by such Selling Stockholder without
the prior written consent of the Representatives, except under certain
circumstances as set forth in each respective lockup agreement signed by such
Selling Stockholder, provided that the transferee agrees to be bound by the
terms of such agreement.
(ii) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal Responsibility
Act of 1982 and the Interest and Dividend Tax Compliance Act of 1983 with
respect to the transactions herein contemplated, each of the Selling
Stockholders agrees to deliver to the Underwriters prior to or at the Closing
Date a properly completed and executed United States Treasury Department Form
W-9 (or other applicable form or statement specified by the Treasury
Department regulations in lieu thereof).
5. COSTS AND EXPENSES. The Company will pay all costs, expenses and fees
incident to the performance of the obligations of the Company and the Selling
Stockholders under this Agreement, including, without limiting the generality of
the foregoing, the following: accounting fees of the Company; the fees and
disbursements of counsel for the Company and the Selling Stockholders; the cost
of printing and delivering to, or as requested by, the Underwriters copies of
the Registration Statement, Preliminary Prospectuses, the Prospectus, this
Agreement, the Agreement Among Underwriters, the Underwriters' Selling
Memorandum, the Underwriters' Questionnaire, the Invitation Letter, the Power of
Attorney, the Listing Application, the Blue Sky Survey and any supplements or
amendments thereto; the filing fees of the Commission, the filing fees and
expenses incident to securing any required review by the National Association of
Securities Dealers, Inc. (the "NASD") of the terms of the sale of the Shares;
the Listing Fee of the Nasdaq National Market; and the expenses, including the
fees and disbursements of counsel for the Underwriters, incurred in connection
with the qualification of the Shares under State securities or Blue Sky laws. To
the extent, if at all, that any of the Selling Stockholders engage special legal
counsel to represent them in connection with this offering, the fees and
expenses of such counsel shall be borne by such Selling Stockholders. Any
transfer taxes
14.
imposed on the sale of the Shares to the several Underwriters will be paid by
the Sellers pro rata. The Company shall not, however, be required to pay for any
of the Underwriters' expenses (other than those related to qualification under
State securities or Blue Sky laws) except that, if this Agreement shall not be
consummated because the conditions in Section 7 hereof are not satisfied, or
because this Agreement is terminated by the Representatives pursuant to Section
6 hereof, or by reason of any failure, refusal or inability on the part of the
Company or the Selling Stockholders to perform any undertaking or satisfy any
condition of this Agreement or to comply with any of the terms hereof on their
part to be performed, unless such failure to satisfy said condition or to comply
with said terms be due to the default or omission of any Underwriter, then the
Company shall reimburse the several Underwriters for reasonable out-of-pocket
expenses, including fees and disbursements of counsel, reasonably incurred in
connection with investigating, marketing and proposing to market the Shares or
in contemplation of performing their obligations hereunder; but the Company and
the Selling Stockholders shall not in any event be liable to any of the several
Underwriters for damages on account of loss of anticipated profits from the sale
by them of the Shares.
6. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS. The several
obligations of the Underwriters to purchase the Firm Shares on the Closing Date
and the Option Shares, if any, on the Option Closing Date are subject to the
accuracy, as of the Closing Date or the Option Closing Date, as the case may be,
of the representations and warranties of the Company and the Selling
Stockholders contained herein, and to the performance by the Company and the
Selling Stockholders of their covenants and obligations hereunder and to the
following additional conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement, as amended from time to time, shall have been issued and in effect
and no proceedings for that purpose shall have been taken or, to the knowledge
of the Company or the Selling Stockholders, shall be contemplated by the
Commission.
(b) The Representatives shall have received on the Closing Date or
the Option Closing Date, as the case may be, the opinion of Xxxxxx Xxxxxxx
Xxxxxxxx and Xxxxxx, P.C., special counsel for the Company and the Selling
Stockholders other than Whitney Subordinated Debt Fund, L.P., Whitney 1990
Equity Fund, L.P., and X.X. Xxxxxxx & Co. (the "Whitney Entities"), dated the
Closing Date or the Option Closing Date, as the case may be, addressed to the
Underwriters to the effect that:
(i) All of the Shares conform to the description thereof
contained in the Prospectus; the form of certificate representing the Company's
Common Stock is in due and proper form; and the Shares to be sold by the Company
pursuant to this Agreement have been duly authorized and will be validly issued,
fully paid and non-assessable when issued and paid for as contemplated by this
Agreement.
(ii) The Registration Statement has become effective under the
Act and, to the best of such counsel's knowledge, no stop order proceeding with
respect thereto has been instituted or is pending or threatened under the Act.
15.
(iii) The Registration Statement, the Preliminary Prospectus
dated October __, 1996, the Prospectus and each amendment or supplement
thereto comply as to form in all material respects with the requirements of
the Act and the applicable rules and regulations thereunder (except that such
counsel need express no opinion as to the financial statements, schedules and
other financial and statistical information included therein).
(iv) The statements under the captions "Risk Factors -- Control
by Existing Stockholders; Anti-Takeover Devices," "Risk Factors -- Shares
Eligible for Future Sale," "Use of Proceeds," "Dividend Policy," "Management --
Other Agreements," "Management -- Stock Incentive Plans," "Management --
Compensation Committee Interlocks and Insider Participation," "Description of
Capital Stock" and "Shares Eligible for Future Sale" in the Prospectus, insofar
as such statements constitute a summary of documents referred to therein or
matters of law, are accurate summaries and fairly and correctly present the
information called for with respect to such documents and matters.
(v) Such counsel does not know of any contracts or documents
required to be filed as exhibits to the Registration Statement or described in
the Registration Statement or the Prospectus which are not so filed or described
as required, and such contracts and documents as are summarized in the
Registration Statement or the Prospectus are fairly summarized in all material
respects.
(vi) Except as set forth in the Prospectus, such counsel knows
of no material legal proceedings pending or threatened (A) against the Company
or any of the Subsidiaries or (B) to which the assets of the Company or any of
the Subsidiaries may be subject.
(vii) The execution and delivery of this Agreement and the
performance by the Company of its obligations pursuant hereto do not and will
not conflict with or result in a breach of any of the terms or provisions of,
or constitute a default under, the certificate of incorporation or by-laws of
the Company, or any agreement or instrument filed or incorporated by
reference as an exhibit to the Registration Statement to which the Company or
any of the Subsidiaries is a party or by which the Company or any of the
Subsidiaries may be bound.
(viii) This Agreement has been duly authorized, executed and
delivered by the Company.
(ix) All corporate action necessary by the Company to execute
and deliver this Agreement and to perform its obligations pursuant hereto and
consummate the transactions contemplated hereby has been taken by the
Company, its Board of Directors and its stockholders.
(x) To the best of such counsel's knowledge, there is no right
to require registration of any shares of capital stock of the Company in
connection with the filing of the Registration Statement that has not been
effectively satisfied or waived.
16.
(xi) No approval, consent, order, authorization, designation,
declaration or filing by or with any regulatory, administrative or other
governmental body is necessary in connection with the execution and delivery of
this Agreement and the consummation of the transactions herein contemplated
(other than as may be required by the NASD or as required by State securities
and Blue Sky laws, as to which such counsel need express no opinion) except such
as have been obtained or made.
(xii) This Agreement, the Custody Agreement and the Power of
Attorney has been duly executed and delivered on behalf of the Selling
Stockholders (other than the Whitney Entities as to which no opinion need be
expressed).
(xiii) Each Selling Stockholder (other than the Whitney
Entities as to which no opinion need be expressed) has full legal right, power
and authority, and any approval required by law (other than as required by State
securities and Blue Sky laws as to which such counsel need express no opinion),
to sell, assign, transfer and deliver the Firm Shares and Option Shares to be
sold by such Selling Stockholder.
(xiv) Assuming that the Underwriters purchase the Shares in good
faith and without notice of any adverse claim as such term is used in Section
8-302 of the Uniform Commercial Code in effect in the state of California,
the delivery of the Shares by the Selling Stockholders (other than the
Whitney Entities as to which no opinion need to be expressed) will pass to
the underwriters valid title to such Shares, free and clear of all security
interests, liens, encumbrances, equities or other adverse claims.
In rendering such opinion, Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, P.C. may
rely as to matters governed by the laws of states of the United States other
than Delaware or New York or Federal laws on local counsel in such
jurisdictions, provided that in each case Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx,
P.C. shall state that they believe that they and the Underwriters are
justified in relying on such other counsel. In addition to the matters set
forth above, such opinion shall also include a statement in such counsel's
customary form to the effect that nothing has come to the attention of such
counsel which leads them to believe that the Registration Statement, as of
the time it became effective under the Act, the Prospectus or any amendment
or supplement thereto, on the date it was filed pursuant to Rule 424(b) and
the Registration Statement and the Prospectus, or any amendment or supplement
thereto, as of the Closing Date or the Option Closing Date, as the case may
be, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading (except that such counsel need express no
view as to financial statements, schedules and other financial or statistical
information included therein). With respect to such statement, Xxxxxx Xxxxxxx
Xxxxxxxx & Xxxxxx, P.C. may state that their belief is based upon the
procedures set forth therein, but is without independent check and
verification.
(c) The Representatives shall have received on the Closing Date or
the Option Closing Date, as the case may be, the opinion of____________________,
counsel for the Whitney Entities, dated the Closing Date or the Option Closing
Date, as the case may be, addressed to the Underwriters to the effect that:
17.
(i) This Agreement, the Custody Agreement and the Power of
Attorney has been duly authorized, executed and delivered on behalf of the
Whitney Entities.
(ii) Each of the Whitney Entities has full legal right, power
and authority, and any approval required by law (other than as required by State
securities and Blue Sky laws as to which such counsel need express no opinion),
to sell, assign, transfer and deliver the Firm Shares and Option Shares to be
sold by such entity.
(iii) Assuming that the Underwriters purchase the Shares in good
faith and without notice of any adverse claim as such term is used in Section 8-
302 of the Uniform Commercial Code in effect in the state of New York, the
delivery of the Shares by the Whitney Entities will pass to the underwriters
valid title to such Shares, free and clear of all security interests, liens,
encumbrances, equities or other adverse claims.
(d) The Representatives shall have received on the Closing Date or
the Option Closing Date, as the case may be, the opinions of XxXxxxxx Xxxxxx as
to matters relating to The North Face (Europe) Limited and Xxxxxx Xxxxxxx &
Harcourt as to matters relating to The North Face (Canada), Inc. dated the
Closing Date or the Option Closing Date, as the case may be, addressed to the
Underwriters to the effect that the respective Subsidiary has been duly
organized and is validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation, with corporate power and
authority to own its properties and conduct its business as described in the
Prospectus; the respective Subsidiary is duly qualified to transact business in
all jurisdictions in which the conduct of its business requires such
qualification, or in which the failure to qualify would have a materially
adverse effect upon the business of the Company and the Subsidiaries taken as a
whole; and the outstanding shares of capital stock of the respective Subsidiary
has been duly authorized and validly issued, is fully paid and nonassessable and
is owned by the Company or a Subsidiary.
(e) The Representatives shall have received on the Closing Date or
the Option Closing Date, as the case may be, the opinion of Crosby, Heafey,
Xxxxx & May, Professional Corporation, corporate counsel for the Company,
dated the Closing Date or the Option Closing Date, as the case may be,
addressed to the Underwriters to the effect that:
(i) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with corporate power and authority to own its properties and conduct
its business as described in the Prospectus; the Company is duly qualified to
transact business in all jurisdictions in which the conduct of its business
requires such qualification, or in which the failure to qualify would have a
materially adverse effect upon the business of the Company and the Subsidiaries
taken as a whole; and, to the best of such counsel's knowledge, except as set
forth in the Registration Statement (including pursuant to the Credit Facility
as defined in the Prospectus), the outstanding shares of capital stock of each
of the Subsidiaries are owned free and clear of all liens, encumbrances and
security interests, and no options, warrants or other rights to purchase,
agreements or other obligations to issue or other rights to convert any
obligations into any shares of capital stock or of ownership interests in the
Subsidiaries are outstanding.
18.
(ii) The Company has authorized and outstanding capital stock
as set forth under the captions "Capitalization" and "Description of Capital
Stock" in the Prospectus; the authorized shares of its capital stock have
been duly authorized; the outstanding shares of its Common Stock have been
duly authorized and validly issued, are fully paid and non-assessable and, to
the best of such counsel's knowledge, were issued in compliance with the
registration and qualification requirements of all applicable federal and
state securities laws or applicable exemptions therefrom; no preemptive
rights of stockholders arising under the Company's certificate of
incorporation or bylaws or any instrument, document or other agreement
referred to in the Registration Statement or filed as an exhibit thereto or,
to the best of such counsel's knowledge, under the statutes, judicial and
administrative decisions, or the rules and regulations of the governmental
agencies of the State of Delaware exist with respect to any of the Shares or
the issue and sale thereof; and, to the best of such counsel's knowledge,
except as set forth in the Prospectus, no option, warrant or other right to
purchase, agreement or other obligation to issue, or right to convert any
obligation into, any share of capital stock or ownership interest in the
Company exists or is outstanding.
(iii) To the best of such counsel's knowledge, there is no
pending or threatened legal or governmental proceeding, judgment or order
against the Company based upon alleged infringement, dilution, unfair
competition or other claim arising from the Company's use of any of the marks
identified in the attached schedule (the "Schedule") of trademark registrations
and applications.
(iv) To the best of such counsel's knowledge, (a) all
registrations of marks listed in the Schedule are valid registrations effective
to the extent respectively provided by the laws of the jurisdictions in which
they were issued, (b) there is no pending or threatened legal or governmental
proceeding against the Company which seeks to invalidate, oppose or cancel any
registrations listed in the Schedule, and (c) there is no judgment or order of a
court or governmental agency issued against the Company which has invalidated or
canceled any registrations listed in the Schedule.
(v) To the best of such counsel's knowledge, the Company has
not filed any documents in any jurisdiction, or otherwise taken steps, to
abandon any of the registrations listed in the Schedule.
(vi) To the best of such counsel's knowledge, the Company owns
all the registrations and applications listed on the Schedule, except for the
registrations and applications in Japan and Korea which the Company sold to
Kabushiki Kaisha Goldwin as of June 7, 1994.
(vii) To the best of such counsel's knowledge, the statements in
the Prospectus under the caption "Business -- Trademarks and Licensing" (the
"Trademark Portion"), insofar as such statements constitute a summary of the
Company's marks and licensing status, are in all material respects accurate
summaries of the legal matters, documents and proceedings relating to such marks
and licensing status described therein.
19.
In addition to the matters set forth above, such opinion shall also
include a statement in such counsel's customary form to the effect that
nothing has come to the attention of such counsel which leads them to believe
that the Trademark Portions of the Registration Statement, as of the time it
became effective under the Act, and the Prospectus or any amendment or
supplement thereto, on the date it was filed pursuant to Rule 424(b) and the
Trademark Portions of the Registration Statement and the Prospectus, or any
amendment or supplement thereto, as of the Closing Date or the Option Closing
Date, as the case may be, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading (except that such counsel need
express no view as to financial statements, schedules and other financial or
statistical information included therein). With respect to such statement,
Crosby, Heafey, Xxxxx & May, Professional Corporation may state that its
belief is based upon the procedures set forth therein, but is without
independent check or verification.
(f) The Representatives shall have received from Xxxxxx Godward LLP,
counsel for the Underwriters, an opinion dated the Closing Date or the Option
Closing Date, as the case may be, substantially to the effect specified in
subparagraphs (i), (ii), (iii), and (viii) of Paragraph (b) of this Section 6,
and that the Company is a validly organized and existing corporation under the
laws of the State of Delaware. In rendering such opinion, counsel may rely as to
all matters governed other than by the laws of the states of California or
Delaware or Federal laws on the opinions of counsel referred to in Paragraphs
(b), (c), (d) and (e) of this Section 6. In addition to the matters set forth
above, such opinion shall also include a statement to the effect that nothing
has come to the attention of such counsel which leads them to believe that the
Registration Statement, as of the time it became effective under the Act, and
the Prospectus or any amendment or supplement thereto, on the date it was filed
pursuant to Rule 424(b) and the Registration Statement and the Prospectus, or
any amendment or supplement thereto, as of the Closing Date or the Option
Closing Date, as the case may be, contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading (except that such counsel need
express no view as to financial statements, schedules and other financial or
statistical information included therein). With respect to such statement,
Xxxxxx Godward LLP may state that its belief is based upon the procedures set
forth therein, but is without independent check and verification.
(g) The Representatives shall have received at or prior to the
Closing Date from Xxxxxx Godward LLP, a memorandum or summary, in form and
substance satisfactory to the Representatives, with respect to the
qualification for offering and sale by the Underwriters of the Shares under
the State securities or Blue Sky laws of such jurisdictions as the
Representatives may reasonably have designated to the Company.
(h) The Representatives shall have received on the Closing Date or
the Option Closing Date, as the case may be, a signed letter from Deloitte &
Touche LLP, dated the Closing Date or the Option Closing Date, as the case may
be, which shall confirm, on the basis of a review in accordance with the
procedures set forth in the letter signed by such firm and dated and delivered
to the Representatives on the date hereof, that nothing has come to their
attention during the period from the date five days prior to the date hereof to
a date not more
20.
than five days prior to the Closing Date or the Option Closing Date, as the case
may be, which would require any change in their letter dated the date hereof if
it were required to be dated and delivered on the Closing Date or the Option
Closing Date, as the case may be. All such letters shall be in form and
substance satisfactory to the Representatives.
(i) The Representatives shall have received on the Closing Date or
the Option Closing Date, as the case may be, a certificate or certificates of
the Company signed by the Chief Executive Officer and the Chief Financial
Officer of the Company to the effect that, as of the Closing Date or the Option
Closing Date, as the case may be, each of them severally represents as follows:
(i) The Registration Statement has become effective under the
Act and no stop order suspending the effectiveness of the Registration Statement
has been issued, and no proceedings for such purpose have been taken or are, to
his or her knowledge, contemplated by the Commission.
(ii) He or she does not know of any litigation instituted or
threatened against the Company of a character required to be disclosed in the
Registration Statement which is not so disclosed; he or she does not know of any
material contract required to be filed as an exhibit to the Registration
Statement which is not so filed; and the representations and warranties of the
Company contained in Section 1 hereof are true and correct as of the Closing
Date or the Option Closing Date, as the case may be.
(iii) He or she has carefully examined the Registration
Statement and the Prospectus and, in his or her opinion, as of the effective
date of the Registration Statement, the statements contained in the Registration
Statement were true and correct, and such Registration Statement and Prospectus
did not omit to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading and, in his or her
opinion, since the effective date of the Registration Statement, no event has
occurred which should have been set forth in a supplement to or an amendment of
the Prospectus which has not been so set forth in such supplement or amendment.
(j) The Company and the Selling Stockholders shall have furnished to
the Representatives such further certificates and documents confirming the
representations and warranties contained herein and related matters as the
Representatives may reasonably have requested.
(k) The Firm Shares and Option Shares, if any, have been approved for
quotation upon official notice of issuance, on the Nasdaq National Market.
The opinions and certificates mentioned in this Agreement shall be
deemed to be in compliance with the provisions hereof only if they are in all
material respects satisfactory to the Representatives and to Xxxxxx Godward LLP,
counsel for the Underwriters.
21.
If any of the conditions hereinabove provided for in this Section 6
shall not have been fulfilled when and as required by this Agreement to be
fulfilled, the obligations of the Underwriters hereunder may be terminated by
the Representatives by notifying the Company and the Selling Stockholders of
such termination in writing or by telegram at or prior to the Closing Date or
the Option Closing Date, as the case may be.
In such event, the Company, the Selling Stockholders and the
Underwriters shall not be under any obligation to each other (except to the
extent provided in Sections 5 and 8 hereof).
7. CONDITIONS OF THE OBLIGATIONS OF THE COMPANY AND THE SELLING
STOCKHOLDERS. The obligations of the Company and the Selling Stockholders to
sell and deliver the portion of the Shares required to be delivered as and when
specified in this Agreement are subject to the conditions that at the Closing
Date or the Option Closing Date, as the case may be, no stop order suspending
the effectiveness of the Registration Statement shall have been issued and in
effect and no proceedings for that purpose shall have been taken or, to the
knowledge of the Company or the Selling Stockholders, shall be contemplated by
the Commission.
8. INDEMNIFICATION.
(a) The Company and each of the Selling Stockholders, jointly and
severally, agree to indemnify and hold harmless each Underwriter and each
person, if any, who controls any Underwriter within the meaning of the Act
against any losses, claims, damages or liabilities to which such Underwriter or
such controlling person may become subject under the Act or otherwise, insofar
as such losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) arise out of or are based upon (i) any untrue statement or
alleged untrue statement of any material fact contained in the Registration
Statement, any Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto, or (ii) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse each Underwriter and each such
controlling person for any legal or other expenses reasonably incurred by such
Underwriter or such controlling person in connection with investigating or
defending any such loss, claim, damage, liability, action or proceeding;
provided, however, that the Company and the Selling Stockholders will not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement, or omission or alleged omission made in the Registration Statement,
any Preliminary Prospectus, the Prospectus, or such amendment or supplement, in
reliance upon and in conformity with written information furnished to the
Company by or through the Representatives specifically for use in the
preparation thereof, and provided, further, that neither the Company nor any
Selling Stockholder will not be liable to any Underwriter, the directors,
officers, employees or agents of such Underwriter or any person controlling such
Underwriter with respect to any loss, claim, damage or liability arising out of
or based on any untrue statement or alleged untrue statement or omission or
alleged omission to state a material fact in any Preliminary Prospectus which is
corrected in the Prospectus if the person asserting any such loss, claim, damage
or liability purchased from such Underwriter but was not sent or given a copy of
the Prospectus at or prior
22.
to the written confirmation of the sale of such Shares to such person. In no
event, however, shall the liability of any Selling Stockholder to the
Underwriters under this Agreement exceed the lesser of (i) that proportion of
the total losses, claims, damages or liabilities indemnified against equal to
the proportion of the total Shares sold hereunder which is being sold by such
Selling Stockholder or (ii) the net proceeds received by such Selling
Stockholder from the Underwriters in the offering. This indemnity agreement will
be in addition to any liability which the Company or the Selling Stockholders
may otherwise have.
(b) Each Underwriter will indemnify and hold harmless the Company,
each of its directors, each of its officers who have signed the Registration
Statement, the Selling Stockholders and each person, if any, who controls the
Company or the Selling Stockholders, within the meaning of the Act, against any
losses, claims, damages or liabilities to which the Company, or any such
director, officer, Selling Stockholder or controlling person may become subject
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto, or arise out of or are based
upon the omission or the alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances under which they were made; and
will reimburse any legal or other expenses reasonably incurred by the Company or
any such director, officer, Selling Stockholder or controlling person in
connection with investigating or defending any such loss, claim, damage,
liability, action or proceeding; provided, however, that each Underwriter shall
be liable in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission has been
made in the Registration Statement, any Preliminary Prospectus, the Prospectus
or such amendment or supplement, in reliance upon and in conformity with written
information furnished to the Company by or through the Representatives
specifically for use in the preparation thereof. This indemnity agreement will
be in addition to any liability which such Underwriter may otherwise have.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to this Section 8, such person (the "indemnified party") shall
promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing. No indemnification provided for in Section
8(a) or (b) shall be available to any party who shall fail to give notice as
provided in this Section 8(c) if the party to whom notice was not given was
unaware of the proceeding to which such notice would have related and was
prejudiced by the failure to give such notice, but the failure to give such
notice shall not relieve the indemnifying party or parties from any liability
which it or they may have to the indemnified party for contribution or otherwise
than on account of the provisions of Section 8(a) or (b). In case any such
proceeding shall be brought against any indemnified party and it shall notify
the indemnifying party of the commencement thereof, the indemnifying party shall
be entitled to participate therein and, to the extent that it shall wish,
jointly with any other indemnifying party similarly notified, to assume the
defense thereof, with counsel satisfactory to such indemnified party and shall
pay as incurred the fees and disbursements of such counsel related to such
proceeding. In any such proceeding,
23.
any indemnified party shall have the right to retain its own counsel at its own
expense. Notwithstanding the foregoing, the indemnifying party shall pay as
incurred the reasonable fees and expenses of the counsel retained by the
indemnified party in the event that (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 connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the reasonable fees and
expenses of more than one separate firm for all such indemnified parties. Such
firm shall be designated in writing by you in the case of parties indemnified
pursuant to Section 8(a) and by the Company and the Selling Stockholders in the
case of parties indemnified pursuant to Section 8(b). 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.
(d) If the indemnification provided for in this Section 8 is
unavailable or insufficient to hold harmless an indemnified party under Section
8(a) or (b) above in respect of any losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) in such proportion as is appropriate
to reflect the relative benefits received by the Company and the Selling
Stockholders on the one hand and the Underwriters on the other from the offering
of the Shares. If, however, the allocation provided by the immediately preceding
sentences is not permitted by applicable law or if the indemnified party failed
to give the notice required under Section 8(c) above, then each indemnifying
party shall contribute to such amount paid or payable by such indemnified party
in such proportion as is appropriate to reflect not only such relative benefits
but also the relative fault of the Company and the Selling Stockholders on the
one hand and the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Selling Stockholders on the one hand and the Underwriters on the other shall be
deemed to be in the same proportion as the total net proceeds from the offering
(before deducting expenses) received by the Company and the Selling Stockholders
bears to the total underwriting discounts and commissions received by the
Underwriters, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company and the Selling Stockholders on the one hand or the
Underwriters on the other and the parties relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Selling Stockholders and the Underwriters agree that it
would not be just and equitable if contributions pursuant to this Section 8(d)
were determined by pro rata
24.
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 8(d). The amount paid
or payable by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to above in
this Section 8(d) shall be deemed to include 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
subsection (d), (i) no Underwriter shall be required to contribute any amount in
excess of the underwriting discounts and commissions applicable to the Shares
purchased by such Underwriter and (ii) no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this Section 8(d) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) In any proceeding relating to the Registration Statement, any
Preliminary Prospectus, the Prospectus or any supplement or amendment therein,
each party against whom contribution may be sought under this Section 8 hereby
consents to the jurisdiction of any court having jurisdiction over any other
contributing party, agrees that process issuing from such court may be served
upon him or it by any other contributing party and consents to the service of
such process and agrees that any other contributing party may join him or it as
an additional defendant in any such proceeding in which such other contributing
party is a party.
9. DEFAULT BY UNDERWRITERS. If on the Closing Date or the Option
Closing Date, as the case may be, any Underwriter shall fail to purchase and pay
for the portion of the Shares which such Underwriter has agreed to purchase and
pay for on such date (otherwise than by reason of any default on the part of the
Company or a Selling Stockholder), you, as Representatives of the Underwriters,
shall use your best efforts to procure within 24 hours thereafter one or more of
the other Underwriters, or any others, to purchase from the Company and the
Selling Stockholders such amounts as may be agreed upon and upon the terms set
forth herein, the Firm Shares or Option Shares, as the case may be, which the
defaulting Underwriter or Underwriters failed to purchase. If during such 24
hours you, as such Representatives, shall not have procured such other
Underwriters, or any others, to purchase the Firm Shares or Option Shares, as
the case may be, agreed to be purchased by the defaulting Underwriter or
Underwriters, then (a) if the aggregate number of shares with respect to which
such default shall occur does not exceed 10% of the Firm Shares or Option
Shares, as the case may be, covered hereby, the other Underwriters shall be
obligated, severally, in proportion in the respective numbers of Firm Shares or
Option Shares, as the case may be, which they are obligated to purchase
hereunder, to purchase the Firm Shares or Option Shares, as the case may be,
which such defaulting Underwriter or Underwriters failed to purchase, or (b) if
the aggregate number of shares of Firm Shares or Option Shares, as the case may
be, with respect to which such default shall occur exceeds 10% of the Firm
Shares or Option Shares, as the case may be, covered hereby, the Company and the
Selling Stockholders or you as the Representatives of the Underwriters will have
the right, by written notice given within the next 24-hour period to the parties
to this Agreement, to terminate this Agreement without liability on the part of
the non-defaulting Underwriters or of the Company or of the Selling Stockholders
except to the extent
25.
provided in Section 8 hereof. In the event of a default by any Underwriter or
Underwriters, as set forth in this Section 9, the Closing Date or Option Closing
Date, as the case may be, may be postponed for such period, not exceeding seven
days, as you, as Representatives, may determine in order that the required
changes in the Registration Statement or in the Prospectus or in any other
documents or arrangements may be effected. The term "Underwriter" includes any
person substituted for a defaulting Underwriter. Any action taken under this
Section 9 shall not relieve any defaulting Underwriter from liability in respect
of any default of such Underwriter under this Agreement.
10. NOTICES. All communication hereunder shall be in writing and, except
as otherwise provided herein, will be mailed, delivered or telegraphed and
confirmed as follows: if to the Underwriters, to Alex. Xxxxx & Sons
Incorporated, 000 Xxxx Xxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, Attention:
Xxxxxxxxx Xxxxxxxxx; if to the Company or the Selling Stockholders, to The North
Face, Inc., 0000 Xxxxxxxx Xxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000, Attention:
Marsden X. Xxxxx, Chief Executive Officer.
11. TERMINATION. This Agreement may be terminated by you by notice to the
Company and the Selling Stockholders as follows:
(a) any time prior to the earlier of (i) the time the Shares are
released by you for sale by notice to the Underwriters, or (ii) 11:30 a.m.
(Baltimore time) on the first business day following the date of this Agreement;
(b) at any time prior to the Closing Date if any of the following has
occurred: (i) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change or any
development involving a prospective material adverse change in or affecting the
condition, financial or otherwise, of the Company and its Subsidiaries taken as
a whole or the earnings, business affairs, management or business prospects of
the Company and its Subsidiaries taken as a whole, whether or not arising in the
ordinary course of business, (ii) any outbreak of hostilities or other national
or international calamity or crisis or change in economic or political
conditions if the effect of such outbreak, calamity, crisis or change on the
financial markets of the United States would, in your reasonable judgment, make
the offering or delivery of the Shares impracticable, (iii) suspension of
trading in securities generally on the New York Stock Exchange or the American
Stock Exchange or limitation on prices (other than limitations on hours or
numbers of days of trading) for securities, on either such Exchange, (iv) the
enactment, publication, decree or other promulgation of any federal or state
statute, regulation, rule or order of any court or other governmental authority
which in your reasonable opinion materially and adversely affects or will
materially or adversely affect the business or operations of the Company, (v)
declaration of a banking moratorium by either federal or New York State
authorities, or (vi) the taking of any action by any federal, state or local
government or agency in respect of its monetary or fiscal affairs which in your
reasonable opinion has a material adverse effect on the securities markets in
the United States; or
(c) as provided in Sections 6 and 9 of this Agreement;
26.
This Agreement also may be terminated by you, by notice to the Company
and the Selling Stockholders, as to any obligation of the Underwriters to
purchase the Option Shares, upon the occurrence at any time prior to the Option
Closing Date of any of the events described in subparagraph (b) above or as
provided in Sections 6 and 9 of this Agreement.
12. SUCCESSORS. This Agreement has been and is made solely for the
benefit of the Underwriters, the Company and the Selling Stockholders and their
respective successors, executors, administrators, heirs and assigns, and the
officers, directors and controlling persons referred to herein, and no other
person will have any right or obligation hereunder. The term "successors" shall
not include any purchaser of the Shares merely because of such purchase.
13. MISCELLANEOUS. The reimbursement, indemnification and contribution
agreements contained in this Agreement and the representations, warranties and
covenants in this Agreement shall remain in full force and effect regardless
of(a) any termination of this Agreement, (b) any investigation made by or on
behalf of any Underwriter or controlling person thereof, or by or on behalf of
the Company or its directors or officers or the Selling Stockholders and (c)
delivery of and payment for the Shares under this Agreement.
This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Maryland.
27.
If the foregoing letter is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company, the Selling
Stockholders and the several Underwriters in accordance with its terms.
Very truly yours,
THE NORTH FACE, INC.
By:________________________________________
Name:
Title:
MARSDEN X. XXXXX
XXXXXXX X. XXXXX
XXXXXXX SUBORDINATED DEBT FUND, X.X.
XXXXXXX 1990 EQUITY FUND, L.P.
J.H. WHITNEY & CO.
By:________________________________________
Attorney-in-Fact
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
ALEX. XXXXX & SONS INCORPORATED
___________________________________
As Representatives of the several
Underwriters listed on Schedule I
By: Alex. Xxxxx & Sons Incorporated
By:________________________________
Authorized Officer
28.
SCHEDULE I
SCHEDULE OF UNDERWRITERS
Underwriter Number of Firm Shares
----------- to be Purchased
----------------------
Alex. Xxxxx & Sons Incorporated . . .
Xxxxxxxxx & Xxxxx LLC . . . . . . . .
X.X. Xxxxxx Securities Inc. . . . . .
Total . . . . . . . . . . . . . . . . . . . . 2,500,000
---------
---------
29.
SCHEDULE II
SCHEDULE OF SELLING STOCKHOLDERS
MAXIMUM NUMBER OF
NAME OF SELLER FIRM SHARES TO BE SOLD
-------------- ----------------------
Marsden X. Xxxxx 140,000
Xxxxxxx X. Xxxxx 140,000
Whitney 1990 Equity 728,873
Fund, X.X.
Xxxxxxx Subordinated 308,909
Debt Fund, L.P.
J.H. Whitney & Co. 182,218
-------
Total 1,500,000
---------
---------
30.
SCHEDULE III
SCHEDULE OF OPTION SHARES
PERCENTAGE OF TOTAL
MAXIMUM NUMBER OF SOLD NUMBER OF
NAME OF SELLER OPTION SHARES TO BE SOLD OPTION SHARES
-------------- ------------------------ -------------------
Whitney 1990 Equity Fund, 224,039 59.7%
X.X.
Xxxxxxx Subordinated Debt 94,952 25.3%
Fund
X.X. Xxxxxxx & Co. 56,009 15.0%
------------- ------
Total 375,000 100.00%
============= ======
31.
