EXHIBIT 1.1
3,033,699 Shares/1/
BUCA, INC.
Common Stock
PURCHASE AGREEMENT
, 2000
U.S. BANCORP XXXXX XXXXXXX INC.
BANC OF AMERICA SECURITIES LLC
BANCBOSTON XXXXXXXXX XXXXXXXX INC.
As Representatives of the several Underwriters
named in Schedule II hereto
c/o U.S. Bancorp Xxxxx Xxxxxxx Inc.
Xxxxx Xxxxxxx Tower
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Ladies and Gentlemen:
BUCA, Inc., a Minnesota corporation (the "Company"), and the shareholders
of the Company listed in Schedule I hereto (the "Selling Shareholders")
severally propose to sell to the several Underwriters named in Schedule II
hereto (the "Underwriters") an aggregate of 3033699 shares (the "Firm Shares")
of Common Stock, $.01 par value per share (the "Common Stock"), of the Company.
The Firm Shares consist of 3,000,000 authorized but unissued shares of Common
Stock to be issued and sold by the Company and 33,699 outstanding shares of
Common Stock to be sold by the Selling Shareholders. The Company and certain
Selling Shareholders have granted to the Underwriters an option to purchase up
to 455,054 additional shares of Common Stock on the terms and for the purposes
set forth in Section 3 hereof (the "Option Shares"). The Firm Shares and any
Option Shares purchased pursuant to this Purchase Agreement are herein
collectively called the "Securities."
The Company and the Selling Shareholders hereby confirm their agreement
with respect to the sale of the Securities to the several Underwriters, for whom
you are acting as Representatives (the "Representatives").
--------------
/1/ Plus an option to purchase up to 455,054 additional shares to cover
over-allotments.
1. Registration Statement and Prospectus. A registration statement on Form
S-1 (File No. 333-32794) with respect to the Securities, including a preliminary
form of prospectus, 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 ("Rules and Regulations") of the Securities and Exchange
Commission (the "Commission") thereunder and has been filed with the Commission;
one or more amendments to such registration statement have also been so prepared
and have been, or will be, so filed; and, if the Company has elected to rely
upon Rule 462(b) of the Rules and Regulations to increase the size of the
offering registered under the Act, the Company will prepare and file with the
Commission a registration statement with respect to such increase pursuant to
Rule 462(b). Copies of such registration statement(s) and amendments and each
related preliminary prospectus have been delivered to you.
If the Company has elected not to rely upon Rule 430A of the Rules and
Regulations, the Company has prepared and will promptly file an amendment to the
registration statement and an amended prospectus (including a term sheet, if
any, meeting the requirements of Rule 434 of the Rules and Regulations). If the
Company has elected to rely upon Rule 430A of the Rules and Regulations, it will
prepare and file a prospectus (or a term sheet meeting the requirements of Rule
434) pursuant to Rule 424(b) that discloses the information previously omitted
from the prospectus in reliance upon Rule 430A. Such registration statement as
amended at the time it is or was declared effective by the Commission, and, in
the event of any amendment thereto after the effective date and prior to the
First Closing Date (as hereinafter defined), such registration statement as so
amended (but only from and after the effectiveness of such amendment), including
a registration statement (if any) filed pursuant to Rule 462(b) of the Rules and
Regulations increasing the size of the offering registered under the Act and
information (if any) deemed to be part of the registration statement at the time
of effectiveness pursuant to Rules 430A(b) and 434(d) of the Rules and
Regulations, is hereinafter called the "Registration Statement." The prospectus
included in the Registration Statement at the time it is or was declared
effective by the Commission is hereinafter called the "Prospectus," except that
if any prospectus (including any term sheet meeting the requirements of Rule 434
of the Rules and Regulations provided by the Company for use with a prospectus
subject to completion within the meaning of Rule 434 in order to meet the
requirements of Section 10(a) of the Rules and Regulations) filed by the Company
with the Commission pursuant to Rule 424(b) (and Rule 434, if applicable) of the
Rules and Regulations or any other such prospectus provided to the Underwriters
by the Company for use in connection with the offering of the Securities
(whether or not required to be filed by the Company with the Commission pursuant
to Rule 424(b) of the Rules and Regulations) differs from the prospectus on file
at the time the Registration Statement is or was declared effective by the
Commission, the term "Prospectus" shall refer to such differing prospectus
(including any term sheet within the meaning of Rule 434 of the Rules and
Regulations) from and after the time such prospectus is filed with the
Commission or transmitted to the Commission for filing pursuant to such Rule
424(b) (and Rule 434, if applicable) or from and after the time it is first
provided to the Underwriters by the Company for such use. The term "Preliminary
Prospectus" as used herein means any preliminary prospectus included in the
Registration Statement
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prior to the time it becomes or became effective under the Act and any
prospectus subject to completion as described in Rule 430A or 434 of the Rules
and Regulations.
2. Representations and Warranties of the Company and the Selling
Shareholders.
(a) The Company represents and warrants to, and agrees with, the several
Underwriters as follows:
(i) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission and each Preliminary
Prospectus, at the time of filing thereof, did not 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, in the light
of the circumstances under which they were made, not misleading; except
that the foregoing shall not apply to statements in or omissions from any
Preliminary Prospectus in reliance upon, and in conformity with, written
information furnished to the Company by you, or by any Underwriter through
you, specifically for use in the preparation thereof.
(ii) As of the time the Registration Statement (or any post-effective
amendment thereto, including a registration statement (if any) filed
pursuant to Rule 462(b) of the Rules and Regulations increasing the size of
the offering registered under the Act) is or was declared effective by the
Commission, upon the filing or first delivery to the Underwriters of the
Prospectus (or any supplement to the Prospectus (including any term sheet
meeting the requirements of Rule 434 of the Rules and Regulations)) and at
the First Closing Date and Second Closing Date (as hereinafter defined),
(A) the Registration Statement and Prospectus (in each case, as so amended
and/or supplemented) conformed or will conform in all material respects to
the requirements of the Act and the Rules and Regulations, (B) the
Registration Statement (as so amended) did not or will not include 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, and (C) the Prospectus (as so supplemented) did not or will
not include 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, in light of the circumstances in which they are or were
made, not misleading; except that the foregoing shall not apply to
statements in or omissions from any such document in reliance upon, and in
conformity with, written information furnished to the Company by you, or by
any Underwriter through you, specifically for use in the preparation
thereof. If the Registration Statement has been declared effective by the
Commission, no stop order suspending the effectiveness of the Registration
Statement has been issued, and no proceeding for that purpose has been
initiated or, to the Company's knowledge, threatened by the Commission.
(iii) The financial statements of the Company, together with the notes
thereto, set forth in the Registration Statement and Prospectus comply in
all material respects
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with the requirements of the Act and the Rules and Regulations and fairly
present the financial condition of the Company as of the dates indicated
and the results of operations and changes in cash flows for the periods
therein specified in conformity with generally accepted accounting
principles consistently applied throughout the periods involved (except as
otherwise stated therein); and the supporting schedules included in the
Registration Statement present fairly the information required to be stated
therein and comply in all material respects with the requirements of the
Act and the Rules and Regulations. No other financial statements or
schedules are required to be included in the Registration Statement or
Prospectus. Deloitte & Touche LLP, which has expressed its opinion with
respect to the financial statements and schedules filed as a part of the
Registration Statement and included in the Registration Statement and
Prospectus, are independent public accountants as required by the Act and
the Rules and Regulations.
(iv) Each of the Company and its subsidiaries has been duly organized
and is validly existing as a corporation in good standing under the laws of
its jurisdiction of incorporation. Each of the Company and its subsidiaries
has full corporate power and authority to own its properties and conduct
its business as currently being carried on and as described in the
Registration Statement and Prospectus, and is duly qualified to do business
as a foreign corporation in good standing in each jurisdiction in which it
owns or leases real property or in which the conduct of its business makes
such qualification necessary and in which the failure to so qualify would
have a material adverse effect upon its business, condition (financial or
otherwise) or properties, taken as a whole.
(v) Except as contemplated in the Prospectus, subsequent to the
respective dates as of which information is given in the Registration
Statement and the Prospectus, neither the Company nor any of its
subsidiaries has incurred any material liabilities or obligations, direct
or contingent, or entered into any material transactions, or declared or
paid any dividends or made any distribution of any kind with respect to its
capital stock; and, except as contemplated in the Prospectus, there has not
been any change in the capital stock (other than a change in the number of
outstanding shares of Common Stock due to the issuance of shares upon the
exercise of outstanding options or warrants or issuance of shares pursuant
to the Company's Piasano Program or the conversion of outstanding
convertible securities), or any material change in the short-term or
long-term debt, or any issuance of options, warrants, convertible
securities or other rights to purchase the capital stock, of the Company or
any of its subsidiaries, or any material adverse change, or any development
involving a prospective material adverse change, in the condition
(financial or otherwise), business or results of operations of the Company
and its subsidiaries, taken as a whole.
(vi) Except as set forth in the Prospectus, there is not pending or,
to the knowledge of the Company, threatened or contemplated, any action,
suit or proceeding to which the Company or any of its subsidiaries is a
party before or by any court or governmental
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agency, authority or body, or any arbitrator, which might result in any
material adverse change in the condition (financial or otherwise),
business, or results of operations of the Company and its subsidiaries,
taken as a whole.
(vii) There are no contracts or documents of the Company or any of its
subsidiaries that are required to be filed as exhibits to the Registration
Statement by the Act or by the Rules and Regulations that have not been so
filed.
(viii) This Agreement has been duly authorized, executed and delivered
by the Company, and constitutes a valid, legal and binding obligation of
the Company, enforceable in accordance with its terms, except as rights to
indemnity hereunder may be limited by federal or state securities laws and
except as such enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting the rights of creditors generally
and subject to general principles of equity. 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, any statute, any
agreement or instrument to which the Company is a party or by which it is
bound or to which any of its property is subject, the Company's charter or
by-laws, or any order, rule, regulation or decree of any court or
governmental agency or body having jurisdiction over the Company or any of
its properties; no consent, approval, authorization or order of, or filing
with, any court or governmental agency or body is required for the
execution, delivery and performance of this Agreement or for the
consummation of the transactions contemplated hereby, including the
issuance or sale of the Securities by the Company, except such as may be
required under the Act or state securities or blue sky laws; and the
Company has full power and authority to enter into this Agreement and to
authorize, issue and sell the Securities as contemplated by this Agreement.
(ix) All of the issued and outstanding shares of capital stock of the
Company, including the outstanding shares of Common Stock, are duly
authorized and validly issued, fully paid and nonassessable, have been
issued in compliance with all federal and state securities laws, were not
issued in violation of or subject to any preemptive rights or other rights
to subscribe for or purchase securities, and the holders thereof are not
subject to personal liability by reason of being such holders; the
Securities which may be sold hereunder by the Company have been duly
authorized and, when issued, delivered and paid for in accordance with the
terms hereof, will have been validly issued and will be fully paid and
nonassessable, and the holders thereof will not be subject to personal
liability by reason of being such holders; and the capital stock of the
Company, including the Common Stock, conforms to the description thereof in
the Registration Statement and Prospectus. Except as otherwise stated in
the Registration Statement and Prospectus, there are no preemptive rights
or other rights to subscribe for or to purchase, or any restriction upon
the voting or transfer of, any shares of Common Stock pursuant to the
Company's charter, by-laws or any agreement or other
5
instrument to which the Company is a party or by which the Company is
bound. Neither the filing of the Registration Statement nor the offering or
sale of the Securities as contemplated by this Agreement gives rise to any
rights for or relating to the registration of any shares of Common Stock or
other securities of the Company, except for such rights which have been
waived or fully satisfied and rights with respect to an aggregate of 1,926
shares underlying a warrant held by a warrantholder of the Company. All of
the issued and outstanding shares of capital stock of each of the Company's
subsidiaries have been duly and validly authorized and issued and are fully
paid and nonassessable, and, except as otherwise described in the
Registration Statement and Prospectus and except for any directors'
qualifying shares, either the Company or a Subsidiary of the Company owns
of record and beneficially, free and clear of any security interests,
claims, liens, proxies, equities or other encumbrances, all of the issued
and outstanding shares of such stock. Except as described in the
Registration Statement and the Prospectus, there are no options, warrants,
agreements, contracts or other rights in existence to purchase or acquire
from the Company or any subsidiary of the Company any shares of the capital
stock of the Company or any subsidiary of the Company. The Company has an
authorized and outstanding capitalization as set forth in the Registration
Statement and the Prospectus.
(x) The Company and each of its subsidiaries holds, and is operating
in compliance with, all franchises, grants, authorizations, licenses,
permits, easements, consents, certificates and orders of any governmental
or self-regulatory body required for the conduct of its business and all
such franchises, grants, authorizations, licenses, permits, easements,
consents, certifications and orders are valid and in full force and effect,
except for such failures to hold, to be in compliance, to be valid and in
full force and effect that would not, individually or in the aggregate,
have a material adverse effect on the condition (financial or otherwise),
business or results of operations of the Company and its subsidiaries,
taken as a whole; and the Company and each of its subsidiaries is in
compliance with all applicable federal, state, local and foreign laws,
regulations, orders and decrees, except for such failures to be so in
compliance that would not, individually or in the aggregate, have a
material adverse effect on the condition (financial or otherwise), business
or results of operations of the Company and its subsidiaries, taken as a
whole.
(xi) The Company and its subsidiaries have good and marketable title
to all property described in the Registration Statement and Prospectus as
being owned by them, in each case free and clear of all liens, claims,
security interests or other encumbrances except such as are described in
the Registration Statement and the Prospectus or those that are not
material in amount and do not adversely affect the use made and proposed to
be made of such property by the Company and its subsidiaries; the property
held under lease by the Company and its subsidiaries is held by them under
valid, subsisting and enforceable leases with only such exceptions with
respect to any particular lease as do not interfere in any material respect
with the conduct of the business of the Company or its subsidiaries; the
Company and each of its subsidiaries owns or possesses all patents, patent
applications, trademarks, service marks, tradenames, trademark
registrations, service xxxx registrations, copyrights, licenses,
inventions,
6
trade secrets and rights necessary for the conduct of the business of the
Company and its subsidiaries as currently carried on and as described in
the Registration Statement and Prospectus; except as stated in the
Registration Statement and Prospectus, to the Company's knowledge, no name
which the Company or any of its subsidiaries uses and no other aspect of
the business of the Company or any of its subsidiaries will involve or give
rise to any infringement of, or license or similar fees for, any patents,
patent applications, trademarks, service marks, tradenames, trademark
registrations, service xxxx registrations, copyrights, licenses,
inventions, trade secrets or other similar rights of others material to the
business of the Company and neither the Company nor any of its subsidiaries
has received any notice alleging any such infringement or fee.
(xii) Neither the Company nor any of its subsidiaries is in violation
of its respective charter or by-laws or in breach of or otherwise in
default in the performance of any obligation, agreement or condition
contained in any bond, debenture, note, indenture, loan agreement or any
other contract, lease or other instrument to which it is subject or by
which any of them may be bound, or to which any of the material property or
assets of the Company or any of its subsidiaries is subject, except for
such breaches or defaults that would not, individually or in the aggregate,
have a material adverse effect on the condition (financial or otherwise),
business or results of operations of the Company and its subsidiaries,
taken as a whole.
(xiii) The Company and its subsidiaries have filed all federal, state,
local and foreign income and franchise tax returns required to be filed and
are not in default in the payment of any taxes which were payable pursuant
to said returns or any assessments with respect thereto, other than any
which the Company or any of its subsidiaries is contesting in good faith.
(xiv) The Company has not distributed and will not distribute any
prospectus or other offering material in connection with the offering and
sale of the Securities other than any Preliminary Prospectus or the
Prospectus or other materials permitted by the Act to be distributed by the
Company.
(xv) The Securities have been approved for listing on the Nasdaq
National Market.
(xvi) Other than the subsidiaries of the Company listed in Exhibit 21
to the Registration Statement, the Company owns no capital stock or other
equity or ownership or proprietary interest in any corporation,
partnership, association, trust or other entity.
(xvii) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with
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management's general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain
accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv)
the recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(xviii) Other than as contemplated by this Agreement, the Company has
not incurred any liability for any finder's or broker's fee or agent's
commission in connection with the execution and delivery of this Agreement
or the consummation of the transactions contemplated hereby.
(xix) Neither the Company nor any of its affiliates is presently doing
business with the government of Cuba or with any person or affiliate
located in Cuba.
(xx) All reports, statements and registrations and amendments thereto
(including without limitation Quarterly Reports on Form 10-Q and Current
Reports on Form 8- K) filed by the Company with Commission since April 26,
1999, on the dates of their respective filings with the Commission,
conformed, in all material respects to the requirements of the Act or the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), as
applicable, and the rules and regulations of the Commission thereunder, and
none of such documents contained an untrue statement of a mateiral fact or
omitted to state a material fact required to be stated therein or necessary
to make the statements therein not misleading.
(b) Each Selling Shareholder represents and warrants to, and agrees with,
the several Underwriters as follows:
(i) If such Selling Shareholder is selling Common Stock issuable upon
exercise of options ("Company Options") to purchase Common Stock of the
Company, such Selling Shareholder is the record and beneficial owner of the
Company Option, free and clear of all security interests, claims, liens,
restrictions on transferability (except as set forth in the Company
Option), legends, proxies, equities or other encumbrances.
(ii) Such Selling Shareholder is the record and beneficial owner of,
and has, and on the First Closing Date will have, valid and marketable
title to the Common Stock (including Common Stock issuable upon exercise of
Common Options) to be sold by such Selling Shareholder, free and clear of
all security interests, claims, liens, restrictions on transferability,
legends, proxies, equities or other encumbrances; and upon delivery of and
payment for such Securities hereunder, the several Underwriters will
acquire valid and marketable title thereto, free and clear of any security
interests, claims, liens, restrictions on transferability, legends,
proxies, equities or other encumbrances. Such Selling Shareholder is
8
selling the Common Stock to be sold by such Selling Shareholder for such
Selling Shareholder's own account and is not selling such Securities,
directly or indirectly, for the benefit of the Company, and no part of the
proceeds of such sale received by such Selling Shareholder will inure,
either directly or indirectly, to the benefit of the Company other than as
described in the Registration Statement and Prospectus.
(iii) Such Selling Shareholder has duly authorized, executed and
delivered a Letter of Transmittal and Custody Agreement ("Custody
Agreement"), which Custody Agreement is a valid and binding obligation of
such Selling Shareholder, to Norwest Bank Minnesota National Association,
as Custodian (the "Custodian"); pursuant to the Custody Agreement the
Selling Shareholder has placed in custody with the Custodian, for delivery
under this Agreement, the certificates representing the Common Stock and
agreements representing the Company Options, if any, to be exercised in
connection with the shares of Common Stock to be sold by such Selling
Shareholder; such certificates represent validly issued, outstanding, fully
paid and nonassessable shares of Common Stock or validly issued and
outstanding Company Options; when issued, the certificates representing
shares issuable upon exercise of Company Options will representvalidly
issued, outstanding, fully paid and nonassessable shares of Common Stock;
and in the case of Company Options, such agreements were accompanied by all
documents duly and properly executed that are necessary to effect the
exercise of such Company Option; and in the case of Common Stock (including
shares of Common Stock issuable upon exercise of Company Options), such
certificates were duly and properly endorsed in blank for transfer, or were
accompanied by all documents duly and properly executed that are necessary
to validate the transfer of title thereto, to the Underwriters, free of any
legend, restriction on transferability, proxy, lien or claim, whatsoever.
(iv) Such Selling Shareholder has the power and authority to enter
into this Agreement, the Letter of Transmittal and the Custody Agreement
and to sell, transfer and deliver the Securities to be sold by such Selling
Shareholder; and such Selling Shareholder has duly authorized, executed and
delivered, or prior to the First Closing will execute and deliver, to Xxxx
X. Xxxxx and Xxxx X. Xxxxxxxxxxxxxx, as attorneys-in-fact (the "Attorneys-
in-Fact"), an irrevocable power of attorney (a "Power of Attorney")
authorizing and directing the Attorneys-in-Fact, or either of them, to
effect the sale and delivery of the Securities being sold by such Selling
Shareholder, to enter into this Agreement and to take all such other action
as may be necessary hereunder.
(v) This Agreement has been duly authorized, executed and delivered by
or on behalf of such Selling Shareholder and constitutes a valid and
binding agreement of such Selling Shareholder, enforceable in accordance
with its terms, and prior to the First Closing, the Custody Agreement and
the Power of Attorney will each have been duly authorized, executed and
delivered, by or on behalf of such Selling Shareholder, and each will
constitute a valid and binding agreement of such Selling Shareholder,
enforceable in accordance with its terms, in each case, except as rights to
indemnity hereunder or thereunder may be limited by federal or state
securities laws and except as such enforceability may be limited by
bankruptcy, insolvency, reorganization or laws affecting the rights of
creditors generally and subject to general principles of equity. The
execution and delivery of this
9
Agreement, the Custody Agreement and the Power of Attorney and the
performance of the terms hereof and thereof 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, any agreement or instrument to which such Selling Shareholder is a
party or by which such Selling Shareholder is bound, or any law,
regulation, order or decree applicable to such Selling Shareholder; no
consent, approval, authorization or order of, or filing with, any court or
governmental agency or body is required for the execution, delivery and
performance of this Agreement, the Custody Agreement and the Power of
Attorney or for the consummation of the transactions contemplated hereby
and thereby, including the sale of the Securities being sold by such
Selling Shareholder, except such as may be required under the Act or state
securities laws or blue sky laws.
(vi) Such Selling Shareholder has not distributed and will not
distribute any prospectus or other offering material in connection with the
offering and sale of the Securities other than any Preliminary Prospectus
or the Prospectus or other materials permitted by the Act to be distributed
by such Selling Shareholder.
(vii) Such Selling Shareholder has reviewed the Registration Statement
and the Prospectus and to the best knowledge of such Selling Shareholder
neither the Registration Statement nor the Prospectus contains any untrue
statement of a material fact or omits to state any material fact required
to be stated therein or necessary to make the statements therein not
misleading regarding such Selling Shareholder, the other Selling
Shareholders, the Company or otherwise.
(viii) To the knowledge of such Selling Shareholder, the
representations and warranties of the Company contained in paragraph (a) of
this Section 2 are true and correct.
(c) Any certificate signed by any officer of the Company and delivered to
you or to counsel for the Underwriters shall be deemed a representation and
warranty by the Company to each Underwriter as to the matters covered thereby;
any certificate signed by or on behalf of any Selling Shareholder as such and
delivered to you or to counsel for the Underwriters shall be deemed a
representation and warranty by such Selling Shareholder to each Underwriter as
to the matters covered thereby.
3. Purchase, Sale and Delivery of Securities.
(a) On the basis of the representations, warranties and agreements herein
contained, but subject to the terms and conditions herein set forth, the Company
agrees to issue and sell 3,000,000 Firm Shares, and each Selling Shareholder
agrees, severally and not jointly, to sell the number of Firm Shares set forth
opposite the name of such Selling Shareholder in Schedule I hereto, to the
several Underwriters, and each Underwriter agrees, severally and not jointly, to
purchase from the
10
Company and the Selling Shareholders the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule II hereto. The purchase price
for each Firm Share shall be $ per share. The obligation of each Underwriter to
each of the Company and the Selling Shareholders shall be to purchase from each
of the Company and the Selling Shareholders that number of Firm Shares (to be
adjusted by the Representatives to avoid fractional shares) which represents the
same proportion of the number of Firm Shares to be sold by each of the Company
and the Selling Shareholders pursuant to this Agreement as the number of Firm
Shares set forth opposite the name of such Underwriter in Schedule II hereto
represents to the total number of Firm Shares to be purchased by all
Underwriters pursuant to this Agreement. In making this Agreement, each
Underwriter is contracting severally and not jointly; except as provided in
paragraph (c) of this Section 3 and in Section 8 hereof, the agreement of each
Underwriter is to purchase only the respective number of Firm Shares specified
in Schedule II.
The Firm Shares will be delivered by the Company and the Custodian to you
for the accounts of the several Underwriters against payment of the purchase
price therefor by wire/same day funds payable to the order of the Company and
the Custodian, as appropriate, at the offices of U.S. Bancorp Xxxxx Xxxxxxx
Inc., Xxxxx Xxxxxxx Tower, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx, or
such other location as may be mutually acceptable, at 9:00 a.m. Central time on
the third (or if the Securities are priced, as contemplated by Rule 15c6-1(c)
under the Exchange Act, after 4:30 p.m. Eastern time, the fourth) full business
day following the date hereof, or at such other time and date as you and the
Company determine pursuant to Rule 15c6-1(a) under the Exchange Act, such time
and date of delivery being herein referred to as the "First Closing Date." If
the Representatives so elect, delivery of the Firm Shares may be made by credit
through full fast transfer to the accounts at The Depository Trust Company
designated by the Representatives. Certificates representing the Firm Shares, in
definitive form and in such denominations and registered in such names as you
may request upon at least two business days' prior notice to the Company and the
Custodian, will be made available for checking and packaging not later than
10:30 a.m., Central time, on the business day next preceding the First Closing
Date at the offices of U.S. Bancorp Xxxxx Xxxxxxx Inc., Xxxxx Xxxxxxx Tower, 000
Xxxxx Xxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx, or such other location as may be
mutually acceptable.
(b) On the basis of the representations, warranties and agreements herein
contained, but subject to the terms and conditions herein set forth, the Company
, with respect to 55,056 Option Shares, and certain Selling Shareholders, with
respect to the number of Option Shares set forth opposite the name of such
Selling Shareholder in Schedule I hereto, hereby grant to the several
Underwriters an option to purchase all or any portion of the Option Shares at
the same purchase price as the Firm Shares, for use solely in covering any
over-allotments made by the Underwriters in the sale and distribution of the
Firm Shares. The option granted hereunder may be exercised at any time (but not
more than once) within 30 days after the effective date of this Agreement upon
notice (confirmed in writing) by the Representatives to the Company and to the
Attorneys-in-Fact setting forth the aggregate number of Option Shares as to
which the several Underwriters are exercising the option, the names and
denominations in which the certificates for the Option Shares are to be
registered and the date and time, as determined by you, when the Option Shares
are to be delivered, such time and date being herein
11
referred to as the "Second Closing" and "Second Closing Date," respectively;
provided, however, that the Second Closing Date shall not be earlier than the
First Closing Date nor earlier than the second business day after the date on
which the option shall have been exercised. If the option is exercised, the
obligation of each Underwirter shall be to purchase Option Shares from the
Company and the Selling Shareholders on a pro rata basis, (to be adjusted by the
Representatives to avoid fractional shares). The number of Option Shares to be
purchased by each Underwriter shall be the same percentage of the total number
of Option Shares to be purchased by the several Underwriters as the number of
Firm Shares to be purchased by such Underwriter is of the total number of Firm
Shares to be purchased by the several Underwriters, as adjusted by the
Representatives in such manner as the Representatives deem advisable to avoid
fractional shares. No Option Shares shall be sold and delivered unless the Firm
Shares previously have been, or simultaneously are, sold and delivered.
The Option Shares will be delivered by the Company and the Custodian to you
for the accounts of the several Underwriters against payment of the purchase
price therefor by wire/same day funds payable to the order of the Company and
the Custodian, as appropriate at the offices of U. S. Bancorp Xxxxx Xxxxxxx
Inc., Xxxxx Xxxxxxx Tower, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx, or
such other location as may be mutually acceptable at 9:00 a.m., Central time, on
the Second Closing Date. If the Representatives so elect, delivery of the Option
Shares may be made by credit through full fast transfer to the accounts at The
Depository Trust Company designated by the Representatives. Certificates
representing the Option Shares in definitive form and in such denominations and
registered in such names as you have set forth in your notice of option
exercise, will be made available for checking and packaging not later than 10:30
a.m., Central time, on the business day next preceding the Second Closing Date
at the office of U.S. Bancorp Xxxxx Xxxxxxx Inc., Xxxxx Xxxxxxx Tower, 000 Xxxxx
Xxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx, or such other location as may be mutually
acceptable.
(c) It is understood that you, individually and not as Representatives of
the several Underwriters may (but shall not be obligated to) make payment to the
Company or the Selling Shareholders, on behalf of any Underwriter for the
Securities to be purchased by such Underwriter. Any such payment by you shall
not relieve any such Underwriter of any of its obligations hereunder. Nothing
herein contained shall constitute any of the Underwriters an unincorporated
association or partner with the Company or any Selling Shareholder.
4. Covenants.
(a) The Company covenants and agrees with the several Underwriters as
follows:
(i) If the Registration Statement has not already been declared
effective by the Commission, the Company will use its best efforts to cause
the Registration Statement and any post-effective amendments thereto to
become effective as promptly as possible; the Company will notify you
promptly of the time when the Registration Statement or any post-effective
amendment to the Registration Statement has become effective or any
12
supplement to the Prospectus (including any term sheet within the meaning
of Rule 434 of the Rules and Regulations) has been filed and of any request
by the Commission for any amendment or supplement to the Registration
Statement or Prospectus or additional information; if the Company has
elected to rely on Rule 430A of the Rules and Regulations, the Company will
prepare and file a Prospectus (or term sheet within the meaning of Rule 434
of the Rules and Regulations) containing the information omitted therefrom
pursuant to Rule 430A of the Rules and Regulations with the Commission
within the time period required by, and otherwise in accordance with the
provisions of, Rules 424(b), 430A and 434, if applicable, of the Rules and
Regulations; if the Company has elected to rely upon Rule 462(b) of the
Rules and Regulations to increase the size of the offering registered under
the Act, the Company will prepare and file a registration statement with
respect to such increase with the Commission within the time period
required by, and otherwise in accordance with the provisions of, Rule
462(b); the Company will prepare and file with the Commission, promptly
upon your request, any amendments or supplements to the Registration
Statement or Prospectus (including any term sheet within the meaning of
Rule 434 of the Rules and Regulations) that, in your opinion, may be
necessary or advisable in connection with the distribution of the
Securities by the Underwriters; and the Company will not file any amendment
or supplement to the Registration Statement or Prospectus (including any
term sheet within the meaning of Rule 434 of the Rules and Regulations) to
which you shall reasonably object by notice to the Company after having
been furnished a copy a reasonable time prior to the filing.
(ii) The Company will advise you, promptly after it shall receive
notice or obtain knowledge thereof, of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement,
of the suspension of the qualification of the Securities for offering or
sale in any jurisdiction, or of the initiation or threatening of any
proceeding for any such purpose; and the Company will promptly use its best
efforts to prevent the issuance of any stop order or to obtain its
withdrawal if such a stop order should be issued.
(iii) Within the time during which a prospectus (including any term
sheet within the meaning of Rule 434 of the Rules and Regulations) relating
to the Securities is required to be delivered under the Act, the Company
will comply as far as it is able with all requirements imposed upon it by
the Act, as now and hereafter amended, and by the Rules and Regulations, as
from time to time in force, so far as necessary to permit the continuance
of sales of or dealings in the Securities as contemplated by the provisions
hereof and the Prospectus. If during such period any event occurs as a
result of which the Prospectus would include an untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances then existing, not
misleading, or if during such period it is necessary to amend the
Registration Statement or supplement the Prospectus to comply with the Act,
the Company will promptly notify you and will amend the Registration
Statement or supplement the Prospectus (at the expense of the Company) so
as to correct such statement or omission or effect such compliance.
13
(iv) The Company will use its best efforts to qualify the Securities
for sale under the securities laws of such jurisdictions as you reasonably
designate and to continue such qualifications in effect so long as required
for the distribution of the Securities, except that the Company shall not
be required in connection therewith to qualify as a foreign corporation or
to execute a general consent to service of process in any state.
(v) The Company will furnish to the Underwriters copies of the
Registration Statement (three of which will be signed and will include all
exhibits), each Preliminary Prospectus, the Prospectus, and all amendments
and supplements (including any term sheet within the meaning of Rule 434 of
the Rules and Regulations) to such documents, in each case as soon as
available and in such quantities as you may from time to time reasonably
request.
(vi) During a period of five years commencing with the date hereof,
the Company will furnish to the Representatives, and to each Underwriter,
who may so request in writing, copies of all periodic and special reports
furnished to the shareholders of the Company and all information, documents
and reports filed with the Commission, the National Association of
Securities Dealers, Inc., The Nasdaq National Market or any securities
exchange.
(vii) The Company will make generally available to its security
holders as soon as practicable, but in any event not later than 15 months
after the end of the Company's current fiscal quarter, an earnings
statement (which need not be audited) covering a 12-month period beginning
after the effective date of the Registration Statement that shall satisfy
the provisions of Section 11(a) of the Act and Rule 158 of the Rules and
Regulations.
(viii) The Company, whether or not the transactions contemplated
hereunder are consummated or this Agreement is prevented from becoming
effective under the provisions of Section 9(a) hereof or is terminated,
will pay or cause to be paid (A) all expenses (including transfer taxes
allocated to the respective transferees) incurred in connection with the
delivery to the Underwriters of the Securities, (B) all expenses and fees
(including, without limitation, fees and expenses of the Company's
accountants and counsel but, except as otherwise provided below, not
including fees of the Underwriters' counsel) in connection with the
preparation, printing, filing, delivery, and shipping of the Registration
Statement (including the financial statements therein and all amendments,
schedules, and exhibits thereto), the Securities, each Preliminary
Prospectus, the Prospectus, and any amendment thereof or supplement
thereto, and the printing, delivery, and shipping of this Agreement and
other underwriting documents, including Blue Sky Memoranda, (C) all filing
fees and fees and disbursements of the Underwriters' counsel incurred in
connection with the qualification of the Securities for offering and sale
by the Underwriters or by dealers under the securities or blue sky laws of
the states and other jurisdictions which you shall designate in accordance
with Section 4(d) hereof, (D) the fees and expenses of any transfer agent
or registrar, (E) the filing fees incident to any
14
required review by the National Association of Securities Dealers, Inc. of
the terms of the sale of the Securities, (F) listing fees, if any, and (G)
all other costs and expenses incident to the performance of its obligations
hereunder that are not otherwise specifically provided for herein. If the
sale of the Securities provided for herein is not consummated by reason of
action by the Company pursuant to Section 9(a) hereof which prevents this
Agreement from becoming effective, or by reason of any failure, refusal or
inability on the part of the Company or the Selling Shareholders to perform
any agreement on its or their part to be performed, or because any other
condition of the Underwriters' obligations hereunder required to be
fulfilled by the Company or the Selling Shareholders is not fulfilled
(unless such failure to fulfill any condition is due to the default or
omission of any Underwriter), the Company will reimburse the several
Underwriters for all out-of-pocket disbursements (including fees and
disbursements of counsel) incurred by the Underwriters in connection with
their investigation, preparing to market and marketing the Securities or in
contemplation of performing their obligations hereunder. The Company shall
not in any event be liable to any of the Underwriters for loss of
anticipated profits from the transactions covered by this Agreement. The
provisions of this Section shall not affect any agreement that the Company
and the Selling Shareholders may make for the allocation or sharing of such
expenses or costs.
(ix) The Company will apply the net proceeds from the sale of the
Securities to be sold by it hereunder for the purposes set forth in the
Prospectus and will file such information with the Commission with respect
to the sale of the Securities and the application of the proceeds therefrom
as may be required in accordance with Rule 463 of the Rules and
Regulations.
(x) Except as contemplated by the Prospectus, the Company will not,
without your prior written consent, offer for sale, sell, contract to sell,
grant any option for the sale of or otherwise issue or dispose of any
Common Stock or any securities convertible into or exchangeable for, or any
options or rights to purchase or acquire, Common Stock, except to the
Underwriters pursuant to this Agreement, the 1996 Stock Incentive Plan of
BUCA, Inc. and Affiliated Company, the Stock Option Plan for Non-Employee
Directors or the Piasano Partner Program or issuances pursuant to the
exercise of options, warrants or convertible securities outstanding on the
date hereof for a period of 90 days after the commencement of the public
offering of the Securities by the Underwriters.
(xi) The Company either has caused to be delivered to you or will
cause to be delivered to you prior to the effective date of the
Registration Statement a letter from each of the Company's directors and
officers and certain other shareholders of the Company holding an aggregate
of _________________________ shares of Common Stock of the Company stating
that such person agrees that he or she will not, without your prior written
consent, offer for sale, sell, contract to sell or otherwise dispose of any
shares of Common Stock or rights to purchase
15
Common Stock, except to the Underwriters pursuant to this Agreement, for a
period of 90 days after commencement of the public offering of the
Securities by the Underwriters.
(xii) The Company has not taken and will not take, directly or
indirectly, any action designed to or which might reasonably be expected to
cause or result in, or which has constituted, the stabilization or
manipulation of the price of any security of the Company to facilitate the
sale or resale of the Securities, and has not effected any sales of Common
Stock which are required to be disclosed in response to Item 701 of
Regulation S-K under the Act which have not been so disclosed in the
Registration Statement.
(xiii) The Company will not incur any liability for any finder's or
broker's fee or agent's commission in connection with the execution and
delivery of this Agreement or the consummation of the transactions
contemplated hereby.
(xiv) The Company will inform the Florida Department of Banking and
Finance at any time prior to the consummation of the distribution of the
Securities by the Underwriters if it commences engaging in business with
the government of Cuba or with any person or affiliate located in Cuba.
Such information will be provided within 90 days after the commencement
thereof or after a change occurs with respect to previously reported
information.
(b) Each Selling Shareholder covenants and agrees with the several
Underwriters as follows:
(i) Except as otherwise agreed to by the Company and the Selling
Shareholder, such Selling Shareholder will pay all taxes, if any, on the
transfer and sale, respectively, of the Securities being sold by such
Selling Shareholder, the fees of such Selling Shareholder's counsel and
such Selling Shareholder's proportionate share (based upon the number of
Securities being offered by such Selling Shareholder pursuant to the
Registration Statement) of all costs and expenses (except for legal and
accounting expenses and fees of the registrar and transfer agent) incurred
by the Company pursuant to the provisions of Section 4(a)(viii) of this
Agreement; provided, however, that each Selling Shareholder severally
agrees to reimburse the Company for any reimbursement made by the Company
to the Underwriters pursuant to Section 4(a)(viii) hereof to the extent
such reimbursement resulted from the failure or refusal on the part of such
Selling Shareholder to comply under the terms or fulfill any of the
conditions of this Agreement.
(ii) If this Agreement shall be terminated by the Underwriters because
of any failure, refusal or inability on the part of such Selling
Shareholder to perform any agreement on such Selling Shareholder's part to
be performed, or because any other condition of the Underwriters'
obligations hereunder required to be fulfilled by such Selling Shareholder
is not
16
fulfilled, such Selling Shareholder agrees to reimburse the several
Underwriters for all out-of-pocket disbursements (including fees and
disbursements of counsel for the Underwriters) incurred by the Underwriters
in connection with their investigation, preparing to market and marketing
the Securities or in contemplation of performing their obligations
hereunder. The Selling Shareholder shall not in any event be liable to any
of the Underwriters for loss of anticipated profits from the transactions
covered by this Agreement.
(iii) The Securities to be sold by such Selling Shareholder,
represented by the certificates on deposit with the Custodian pursuant to
the Custody Agreement of such Selling Shareholder, are subject to the
interest of the several Underwriters and the other Selling Shareholders;
the arrangements made for such custody are, except as specifically provided
in the Custody Agreement, irrevocable; and the obligations of such Selling
Shareholder hereunder shall not be terminated, except as provided in this
Agreement or in the Custody Agreement, by any act of such Selling
Shareholder, by operation of law, whether by the liquidation, dissolution
or merger of such Selling Shareholder, by the death, disability, or
insolvency of such Selling Shareholder, or by the occurrence of any other
event. If any Selling Shareholder should liquidate, dissolve or be a party
to a merger (if such Selling Shareholder is other than an individual) or
die, become disabled or become insolvent (if such Selling Shareholder is an
individual) or if any other such event should occur before the delivery of
the Securities hereunder, certificates for the Securities deposited with
the Custodian shall be delivered by the Custodian in accordance with the
terms and conditions of this Agreement as if such liquidation, dissolution,
merger, death, incapacity, insolvency or other event had not occurred,
whether or not the Custodian shall have received notice thereof.
(iv) Such Selling Shareholder will not, without your prior written
consent, offer for sale, sell, contract to sell, grant any option for the
sale of or otherwise dispose of any Common Stock or any securities
convertible into or exchangeable for, or any options or rights to purchase
or acquire, Common Stock, except to the Underwriters pursuant to this
Agreement, for a period of 90 days after the commencement of the public
offering of the Securities by the Underwriters.
(v) Such Selling Shareholder has not taken and will not take, directly
or indirectly, any action designed to or which might reasonably be expected
to cause or result in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Securities,
and has not effected any sales of Common Stock which, if effected by the
Company, would be required to be disclosed in response to Item 701 of
Regulation S-K.
(vi) Such Selling Shareholder shall immediately notify you if any
event occurs, or of any change in information relating to such Selling
Shareholder or, to the knowledge of such Selling Shareholder, the Company
or any new information relating to the Company or relating to any matter
stated in the Prospectus or any supplement thereto
17
(including any term sheet within the meaning of Rule 434 of the Rules and
Regulations), which results in the Prospectus (as supplemented) including
an untrue statement of a material fact or omitting to state any material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
5. Conditions of Underwriters' Obligations. The obligations of the several
Underwriters hereunder are subject to the accuracy, as of the date hereof and at
each of the First Closing Date and the Second Closing Date (as if made at such
Closing Date), of and compliance with all representations, warranties and
agreements of the Company and the Selling Shareholders contained herein, to the
performance by the Company and the Selling Shareholders of their respective
obligations hereunder and to the following additional conditions:
(a) The Registration Statement shall have become effective not later than
5:00 p.m., Central time, on the date of this Agreement, or such later time and
date as you, as Representatives of the several Underwriters, shall approve and
all filings required by Rules 424, 430A and 434 of the Rules and Regulations
shall have been timely made; no stop order suspending the effectiveness of the
Registration Statement or any amendment thereof shall have been issued; no
proceedings for the issuance of such an order shall have been initiated or
threatened; and any request of the Commission for additional information (to be
included in the Registration Statement or the Prospectus or otherwise) shall
have been complied with to your satisfaction.
(b) No Underwriter shall have advised the Company that the Registration
Statement or the Prospectus, or any amendment thereof or supplement thereto
(including any term sheet within the meaning of Rule 434 of the Rules and
Regulations), contains an untrue statement of fact which, in your opinion, is
material, or omits to state a fact which, in your opinion, is material and is
required to be stated therein or necessary to make the statements therein not
misleading.
(c) Except as contemplated in the Prospectus, subsequent to the respective
dates as of which information is given in the Registration Statement and the
Prospectus, neither the Company nor any of its subsidiaries shall have incurred
any material liabilities or obligations, direct or contingent, or entered into
any material transactions, or declared or paid any dividends or made any
distribution of any kind with respect to its capital stock; and except as
contemplated in the Prospectus, there shall not have been any change in the
capital stock (other than a change in the number of outstanding shares of Common
Stock due to the issuance of shares upon the exercise of outstanding options or
warrants or issuance of shares pursuant to the Company's Piasano Program or the
conversion of outstanding convertible securities), or any material change in the
short-term or long-term debt of the Company, or any issuance of options,
warrants, convertible securities or other rights to purchase the capital stock
of the Company or any of its subsidiaries, or any material adverse change or any
development involving a prospective material adverse change (whether or not
arising in the ordinary course of business), in the condition (financial or
otherwise), business or results of operations of the Company and its
subsidiaries,
18
taken as a whole, that, in your judgment, makes it impractical or inadvisable to
offer or deliver the Securities on the terms and in the manner contemplated in
the Prospectus.
(d) On each Closing Date, there shall have been furnished to you, as
Representatives of the several Underwriters, the opinion of Faegre and Xxxxxx
LLP, counsel for the Company, dated such Closing Date and addressed to you, to
the effect that:
(i) Each of the Company and its subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation. Each of the Company
and its subsidiaries has full corporate power and authority to own its
properties and conduct its business as currently being carried on and as
described in the Registration Statement and Prospectus, and is duly
qualified to do business as a foreign corporation and is in good standing
in each jurisdiction in which it owns or leases real property or in which
the conduct of its business makes such qualification necessary and in which
the failure to so qualify would have a material adverse effect upon the
business, condition (financial or otherwise) or properties of the Company
and its subsidiaries, taken as a whole.
(ii) The capital stock of the Company conforms as to legal matters to
the description thereof contained in the Prospectus under the caption
"Description of Capital Stock." All of the issued and outstanding shares of
the capital stock of the Company have been duly authorized and validly
issued and are fully paid and nonassessable, and the holders thereof are
not subject to personal liability by reason of being such holders. The
Securities to be issued and sold by the Company hereunder have been duly
authorized and, when issued, delivered and paid for in accordance with the
terms of this Agreement, will have been validly issued and will be fully
paid and nonassessable, and the holders thereof will not be subject to
personal liability by reason of being such holders. Except as otherwise
stated in the Registration Statement and Prospectus, there are no
preemptive rights or other rights to subscribe for or to purchase, or any
restriction upon the voting or transfer of, any shares of Common Stock
pursuant to the Company's charter, by-laws or any agreement or other
instrument known to such counsel to which the Company is a party or by
which the Company is bound. To the best of such counsel's knowledge,
neither the filing of the Registration Statement nor the offering or sale
of the Securities as contemplated by this Agreement gives rise to any
rights for or relating to the registration of any shares of Common Stock or
other securities of the Company, except for such rights which have been
waived or fully satisfied or otherwise disclosed in this Purchase
Agreement.
(iii) All of the issued and outstanding shares of capital stock of
each of the Company's subsidiaries have been duly and validly authorized
and issued and are fully paid and nonassessable, and, to the best of such
counsel's knowledge, except as otherwise described in the Registration
Statement and Prospectus and except for directors' qualifying shares, the
Company owns of record and beneficially, free and clear of any security
interests, claims, liens, proxies, equities or other encumbrances, all of
the issued and outstanding shares of such stock.
19
To the best of such counsel's knowledge, except as described in the
Registration Statement and Prospectus, there are no options, warrants,
agreements, contracts or other rights in existence to purchase or acquire
from the Company or any subsidiary any shares of the capital stock of the
Company or any subsidiary of the Company.
(iv) The Registration Statement has become effective under the Act
and, to the best of such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceeding for that purpose has been instituted or, to the knowledge of
such counsel, threatened by the Commission.
(v) The descriptions in the Registration Statement and Prospectus of
statutes, legal and governmental proceedings, contracts and other documents
are accurate and fairly present the information required to be shown; and
such counsel does not know of any statutes or legal or governmental
proceedings required to be described in the Prospectus that are not
described as required, or of any contracts or documents of a character
required to be described in the Registration Statement or Prospectus or
included as exhibits to the Registration Statement that are not described
or included as required.
(vi) The Company has full corporate power and authority to enter into
this Agreement, and this Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid, legal and binding
obligation of the Company enforceable in accordance with its terms (except
as rights to indemnity hereunder may be limited by federal or state
securities laws and except as such enforceability may be limited by
bankruptcy, insolvency, reorganization or similar laws affecting the rights
of creditors generally and subject to general principles of equity); 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, any applicable statute, rule or regulation, any agreement or
instrument known to such counsel to which the Company is a party or by
which it is bound or to which any of its property is subject, the Company's
charter or by-laws, or any order or decree known to such counsel of any
court or governmental agency or body having jurisdiction over the Company
or any of its respective properties; and no consent, approval,
authorization or order of, or filing with, any court or governmental agency
or body is required for the execution, delivery and performance of this
Agreement or for the consummation of the transactions contemplated hereby,
including the issuance or sale of the Securities by the Company, except
such as may be required under the Act or state securities laws.
(vii) To the best of such counsel's knowledge, neither the Company nor
any of its subsidiaries is in violation of its respective charter or
by-laws.
20
(viii) The Registration Statement and the Prospectus, and any
amendment thereof or supplement thereto (including any term sheet within
the meaning of Rule 434 of the Rules and Regulations), comply as to form in
all material respects with the requirements of the Act and the Rules and
Regulations; and on the basis of conferences with officers of the Company,
examination of documents referred to in the Registration Statement and
Prospectus and such other procedures as such counsel deemed appropriate,
nothing has come to the attention of such counsel that causes such counsel
to believe that the Registration Statement or any amendment thereof, at the
time the Registration Statement became effective and as of such Closing
Date (including any Registration Statement filed under Rule 462(b) of the
Rules and Regulations), contained any untrue statement of a material fact
or omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading or that the
Prospectus (as of its date and as of such Closing Date), as amended or
supplemented, includes any untrue statement of material fact or omits to
state a material fact necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading; it being
understood that such counsel need express no opinion as to the financial
statements or other financial data included in or omitted from any of the
documents mentioned in this clause.
In rendering such opinion such counsel may rely (i) as to matters of law
other than Minnesota and federal law, upon the opinion or opinions of local
counsel provided that the extent of such reliance is specified in such opinion
and that such counsel shall state that such opinion or opinions of local counsel
are satisfactory to them and that they believe they and you are justified in
relying thereon and (ii) as to matters of fact, to the extent such counsel deems
reasonable upon certificates of officers of the Company and its subsidiaries
provided that the extent of such reliance is specified in such opinion.
(e) On the First Closing Date, each Selling Shareholder shall have
furnished to you, as Representatives of the several Underwriters, an opinion of
counsel of such Selling Shareholder, dated such Closing Date and addressed to
you, to the effect that:
(i) Such Selling Shareholder is the sole record and beneficial owner
of the Securities to be sold by such Selling Shareholder and delivery of
the certificates for the Securities to be sold by such Selling Shareholder
pursuant to this Agreement, upon payment therefor by the Underwriters, will
pass marketable title to such Securities to the Underwriters and the
Underwriters will acquire all the rights of such Selling Shareholder in the
Securities (assuming the Underwriters have no knowledge of an adverse
claim), free and clear of any security interests, claims, liens or other
encumbrances.
(ii) Such Selling Shareholder has the power and authority to enter
into the Custody Agreement, the Power of Attorney and this Agreement and to
perform and discharge such Selling Shareholder's obligations thereunder and
hereunder; and this Agreement, the Custody Agreements and the Powers of
Attorney have been duly and validly authorized,
21
executed and delivered by (or by the Attorneys-in-Fact, or either of them,
on behalf of) such Selling Shareholder and are valid and binding agreements
of the Selling Shareholders, enforceable in accordance with their
respective terms (except as rights to indemnity hereunder or thereunder may
be limited by federal or state securities laws and except as such
enforceability may be limited by bankruptcy, insolvency, reorganization or
similar laws affecting creditors' rights generally and subject to general
principles of equity).
(iii) The execution and delivery of this Agreement, the Custody
Agreement and the Power of Attorney and the performance of the terms hereof
and thereof 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, any statute, rule or
regulation, or any agreement or instrument known to such counsel to which
such Selling Shareholder is a party or by which such Selling Shareholder is
bound or to which any of its property is subject, any such Selling
Shareholder's charter or by-laws, or any order or decree known to such
counsel of any court or government agency or body having jurisdiction over
such Selling Shareholder or any of its respective properties; and no
consent, approval, authorization or order of, or filing with, any court or
governmental agency or body is required for the execution, delivery and
performance of this Agreement, the Custody Agreement and the Power of
Attorney or for the consummation of the transactions contemplated hereby
and thereby, including the sale of the Securities being sold by such
Selling Shareholder, except such as may be required under the Act or state
securities laws or blue sky laws.
(iv) Such other matters as you may reasonably request.
In rendering such opinion such counsel may rely (i) as to matters of law
other than Minnesota and federal law, upon the opinion or opinions of local
counsel provided that the extent of such reliance is specified in such opinion
and that such counsel shall state that such opinion or opinions of local counsel
are satisfactory to them and that they believe they and you are justified in
relying thereon and (ii) as to matters of fact, to the extent such counsel deems
reasonable upon certificates of such Selling Shareholder provided that the
extent of such reliance is specified in such opinion.
(f) On each Closing Date, there shall have been furnished to you, as the
Representatives of the several Underwriters, such opinion or opinions from
Xxxxxx & Xxxxxxx LLP, counsel for the Underwriters, dated such Closing Date and
addressed to you, with respect to the formation of the Company, the validity of
the Securities, the Registration Statement, the Prospectus and other related
matters as you reasonably may request, and such counsel shall have received such
papers and information as they request to enable them to pass upon such matters.
(g) On each Closing Date you, as Representatives of the several
Underwriters, shall have received a letter of Deloitte & Touche LLP, dated such
Closing Date and addressed to you, confirming that they are independent public
accountants within the meaning of the Act and are in
22
compliance with the applicable requirements relating to the qualifications of
accountants under Rule 2-01 of Regulation S-X of the Commission, and stating, as
of the date of such letter (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than five days
prior to the date of such letter), the conclusions and findings of said firm
with respect to the financial information and other matters covered by its
letter delivered to you concurrently with the execution of this Agreement, and
the effect of the letter so to be delivered on such Closing Date shall be to
confirm the conclusions and findings set forth in such prior letter.
(h) On each Closing Date, there shall have been furnished to you, as
Representatives of the several Underwriters, a certificate of the Company, dated
such Closing Date and addressed to you, signed by the chief executive officer
and by the chief financial officer of the Company, to the effect that:
(i) The representations and warranties of the Company in this
Agreement are true and correct, in all material respects, as if made at and
as of such Closing Date, and the Company has complied with all the
agreements and satisfied all the conditions on its part to be performed or
satisfied at or prior to such Closing Date;
(ii) No stop order or other order suspending the effectiveness of the
Registration Statement or any amendment thereof or the qualification of the
Securities for offering or sale has been issued, and no proceeding for that
purpose has been instituted or, to the best of their knowledge, is
contemplated by the Commission or any state or regulatory body; and
(iii) The signers of said certificate have carefully examined the
Registration Statement and the Prospectus, and any amendments thereof or
supplements thereto (including any term sheet within the meaning of Rule
434 of the Rules and Regulations), and (A) such documents contain all
statements and information required to be included therein, the
Registration Statement, or any amendment thereof, does not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading, and the Prospectus, as amended or supplemented, does not
include any untrue statement of material fact or omit to state a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, (B) since the
effective date of the Registration Statement, there has occurred no event
required to be set forth in an amended or supplemented prospectus which has
not been so set forth, (C) subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
neither the Company nor any of its subsidiaries has incurred any material
liabilities or obligations, direct or contingent, or entered into any
material transactions, not in the ordinary course of business, or declared
or paid any dividends or made any distribution of any kind with respect to
its capital stock, and except as contemplated in the
23
Prospectus, there has not been any change in the capital stock (other than
a change in the number of outstanding shares of Common Stock due to the
issuance of shares upon the exercise of outstanding options or warrants or
issuance of shares pursuant to the Company's Piasano Program or the
conversion of outstanding convertible securities), or any material change
in the short-term or long-term debt, or any issuance of options, warrants,
convertible securities or other rights to purchase the capital stock, of
the Company, or any of its subsidiaries, or any material adverse change or
any development involving a prospective material adverse change (whether or
not arising in the ordinary course of business), in the condition
(financial or otherwise), business or results of operations of the Company
and its subsidiaries, taken as a whole, and (D) except as stated in the
Registration Statement and the Prospectus, there is not pending, or, to the
knowledge of the Company, threatened or contemplated, any action, suit or
proceeding to which the Company or any of its subsidiaries is a party
before or by any court or governmental agency, authority or body, or any
arbitrator, which might result in any material adverse change in the
condition (financial or otherwise), business or results of operations of
the Company and its subsidiaries, taken as a whole.
(i) On the First Closing Date, there shall have been furnished to you, as
Representatives of the several Underwriters, a certificate or certificates,
dated such Closing Date and addressed to you, signed by each of the Selling
Shareholders or either of such Selling Shareholder's Attorneys-in-Fact to the
effect that the representations and warranties of such Selling Shareholder
contained in this Agreement are true and correct as if made at and as of such
Closing Date, and that such Selling Shareholder has complied with all the
agreements and satisfied all the conditions on such Selling Shareholder's part
to be performed or satisfied at or prior to such Closing Date.
(j) The Company shall have furnished to you and counsel for the
Underwriters such additional documents, certificates and evidence as you or they
may have reasonably requested.
(k) The Securities to be sold by the Company and the Selling Shareholders
shall have been duly accepted for listing, subject to notice of issuance,
through The Nasdaq National Market.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are satisfactory in form and
substance to you and counsel for the Underwriters. The Company will furnish you
with such conformed copies of such opinions, certificates, letters and other
documents as you shall reasonably request.
6. Indemnification and Contribution.
(a)(i) The Company and the Selling Shareholders listed on Schedule
I(a), jointly and severally, agree to indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
24
otherwise (including in settlement of any litigation if such settlement is
effected with the written consent of the Company and/or such Selling
Shareholders, as the case may be), insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, including the information deemed
to be a part of the Registration Statement at the time of effectiveness
pursuant to Rules 430A and 434(d) of the Rules and Regulations, if
applicable, any Preliminary Prospectus, the Prospectus, or any amendment or
supplement thereto (including any term sheet within the meaning of Rule 434
of the Rules and Regulations), or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading, and will reimburse each Underwriter for any legal or other
expenses reasonably incurred by it in connection with investigating or
defending against such loss, claim, damage, liability or action; provided,
however, that neither the Company nor any Selling Shareholder shall be
liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in the
Registration Statement, any Preliminary Prospectus, the Prospectus, or any
such amendment or supplement, in reliance upon and in conformity with
written information furnished to the Company by you, or by any Underwriter
through you, specifically for use in the preparation thereof; and further
provided, that the foregoing indemnity agreement is subject to the
condition that, insofar as it relates to any untrue statement, alleged
untrue statement, omission or alleged omission made in any Preliminary
Prospectus but eliminated or remedied in the Prospectus, such indemnity
agreement shall not inure to the benefit of any Underwriter (or to the
benefit of any person who controls the Underwriter) if the person asserting
any loss, claim, damage or liability purchased the Securities from the
Underwriter, and a copy of the Prospectus was not given to such person
with, or prior to, the written confirmation of the sale of such Securities
to such person. However, in no event shall any Selling Shareholder be
liable under the provisions of this Section 6 for any amount in excess of
the aggregate amount of proceeds such Selling Shareholder received from the
sale of the Securities pursuant to this Agreement.
(ii) In addition to their other obligations under this Section 6(a),
the Company and each Selling Shareholder, jointly and severally, agree
that, as an interim measure during the pendency of any claim, action,
investigation, inquiry or other proceeding arising out of or based upon any
statement or omission, or any alleged statement or omission, described in
this Section 6(a), they will reimburse each Underwriter on a monthly basis
for all reasonable legal fees or other expenses incurred in connection with
investigating or defending any such claim, action, investigation, inquiry
or other proceeding, notwithstanding the absence of a judicial
determination as to the propriety and enforceability of the Company's
and/or such Selling Shareholder's obligation to reimburse the Underwriters
for such expenses and the possibility that such payments might later be
held to have been improper by a court of competent jurisdiction. To the
extent that any such interim reimbursement payment is so held to have been
improper, the Underwriter that received such payment shall promptly return
it to the party or parties that made such payment, together with interest,
compounded daily, determined on the basis of the prime rate (or other
commercial lending rate for borrowers of the highest credit standing)
announced from time to time by US Bancorp (the "Prime Rate"). Any such
interim
25
reimbursement payments which are not made to an Underwriter within 30 days
of a request for reimbursement shall bear interest at the Prime Rate from
the date of such request. This indemnity agreement shall be in addition to
any liabilities which the Company or such Selling Shareholders may
otherwise have.
(iii) Each Selling Shareholder who is listed in Schedule I(b),
severally and not jointly, agrees to indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject under the Act or
otherwise (including in settlement of any litigation if such settlement is
effected with the written consent of such Selling Stockholder), insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement,
including the information deemed to be a part of the Registration Statement
at the time of effectiveness pursuant to Rule 430A and 434(d) of the Rules
and Regulations, if applicable, any Preliminary Prospectus, the Prospectus,
or any amendment or supplement thereto (including any term sheet within the
meaning of Rule 434 of the Rules and Regulations), or arise out of or are
based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading, but only to the extent that such untrue statement
or alleged untrue statement or omission or alleged omission was made in
reliance upon and in conformity with written information furnished to the
Company or such Underwriter by such Selling Shareholder, specifically for
use in the preparation thereof, and will reimburse each Underwriter for any
legal or other expenses reasonably incurred by it in connection with
investigating or defending against such loss, claim, damage, liability or
action; provided, however, that the Selling Shareholder shall not be liable
in any such case to the extent that any such loss, claim, damage, liability
or action arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in the Registration
Statement, any Preliminary Prospectus, the Prospectus, or any such
amendment or supplement, in reliance upon and in conformity with written
information furnished to the Company by you, or by any Underwriter through
you, specifically for use in the preparation thereof; and further provided,
that the foregoing indemnity agreement is subject to the condition that,
insofar as it relates to any untrue statement, alleged untrue statement,
omission or alleged omission made in any Preliminary Prospectus but
eliminated or remedied in the Prospectus, such indemnity agreement shall
not inure to the benefit of the Underwriter (or to the benefit of any
person who controls the Underwriter) if the person asserting any loss,
claim, damage or liability purchased the Securities from the Underwriter,
and a copy of the Prospectus was not given to such person with, or prior
to, the written confirmation of the sale of such Securities to such person.
However, in no event shall any Selling Shareholder be liable under the
provisions of this Section 6(a) (iii) for any amount in excess of the
aggregate amount of proceeds such Selling Shareholder received from the
sale of the Securities pursuant to this Agreement.
(b) Each Underwriter will indemnify and hold harmless the Company and each
Selling Shareholder against any losses, claims, damages or liabilities to which
the Company and the Selling Shareholders may become subject, under the Act or
otherwise (including in settlement of any
26
litigation, if such settlement is effected with the written consent of such
Underwriter), insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement, any Preliminary Prospectus, the Prospectus, or any amendment or
supplement thereto (including any term sheet within the meaning of Rule 434 of
the Rules and Regulations), or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in the Registration
Statement, any Preliminary Prospectus, the Prospectus, or any such amendment or
supplement, in reliance upon and in conformity with written information
furnished to the Company by you, or by such Underwriter through you,
specifically for use in the preparation thereof, and will reimburse the Company
and the Selling Shareholders for any legal or other expenses reasonably incurred
by the Company or any such Selling Shareholder in connection with investigating
or defending against any such loss, claim, damage, liability or action.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve the indemnifying party from any liability that it may have to any
indemnified party to the extent it is not prejudiced as a proximate result of
such failure. In case any such action 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 in, 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 after notice from the indemnifying party to such
indemnified party of the indemnifying party's election so to assume the defense
thereof, the indemnifying party shall not be liable to such indemnified party
under such subsection for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof other than
reasonable costs of investigation; provided, however, that if the indemnified
party shall have reasonably concluded that there may be a conflict between the
positions of the indemnifying party and the indemnified party in conducting the
defense of any such action or that there may be legal defenses available to it
or other indemnified parties which are different from or additional to those
available to the indemnifying party, the indemnified party shall have the right
to employ separate counsel at the expense of the indemnifying party. 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
fees and expenses of more than one separate firm at any time for all such
indemnified parties. Such firm shall be designated in writing by the
Representatives and shall be reasonably satisfactory to the Company in the case
of parties indemnified pursuant to Section 6(a) and shall be designated in
writing by the Company and shall be reasonably satisfactory to the
Representatives in the case of parties indemnified pursuant to Section 6(b). An
indemnifying party shall not be obligated under any settlement agreement
relating to any action under this Section 6 to which it has not agreed in
writing.
27
(d) If the indemnification provided for in this Section 6 is unavailable or
insufficient to hold harmless an indemnified party under subsection (a) or (b)
above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above, (i) in such proportion
as is appropriate to reflect the relative benefits received by the Company and
the Selling Shareholders on the one hand and the Underwriters on the other from
the offering of the Securities or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company and the Selling Shareholders on the one
hand and the Underwriters on the other in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative benefits received
by the Company and the Selling Shareholders 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 Shareholders bear 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, the Selling Shareholders or the
Underwriters and the parties' relevant intent, knowledge, access to information
and opportunity to correct or prevent such untrue statement or omission. The
Company, the Selling Shareholders and the Underwriters agree that it would not
be just and equitable if contributions pursuant to this subsection (d) were to
be determined by pro rata 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 in the first sentence
of this subsection (d). The amount paid by an indemnified party as a result of
the losses, claims, damages or liabilities referred to in the first sentence of
this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending against any action or claim which is the subject of this subsection
(d). Notwithstanding the provisions of this subsection (d), no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages that such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this subsection
(d) to contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) The obligations of the Company and the Selling Shareholders under this
Section 6 shall be in addition to any liability which the Company and the
Selling Shareholders may otherwise have and shall extend, upon the same terms
and conditions, to each person, if any, who controls any Underwriter within the
meaning of the Act; and the obligations of the Underwriters under
28
this Section 6 shall be in addition to any liability that the respective
Underwriters may otherwise have and shall extend, upon the same terms and
conditions, to each director of the Company (including any person who, with his
consent, is named in the Registration Statement as about to become a director of
the Company), to each officer of the Company who has signed the Registration
Statement and to each person, if any, who controls the Company or any Selling
Shareholder within the meaning of the Act.
7. Representations and Agreements to Survive Delivery. All representations,
warranties, and agreements of the Company and the Selling Shareholders contained
herein or in certificates delivered pursuant hereto, and the agreements of the
several Underwriters, the Company and the Selling Shareholders contained in
Section 6 hereof, shall remain operative and in full force and effect regardless
of any investigation made by or on behalf of any Underwriter or any controlling
person thereof, or the Company or any of its officers, directors, or controlling
persons, or any Selling Shareholders or any controlling person thereof, and
shall survive delivery of, and payment for, the Securities to and by the
Underwriters hereunder.
8. Substitution of Underwriters.
(a) If any Underwriter shall fail to take up and pay for the amount of Firm
Shares agreed by such Underwriter to be purchased hereunder, upon tender of such
Firm Shares in accordance with the terms hereof, and the amount of Firm Shares
not purchased does not aggregate more than 10% of the total amount of Firm
Shares set forth in Schedule II hereto, the other Underwriters shall be
obligated to take up and pay for the Firm Shares that the withdrawing or
defaulting Underwriter agreed but failed to purchase.
(b) If any Underwriter shall fail to take up and pay for the amount of Firm
Shares agreed by such Underwriter to be purchased hereunder, upon tender of such
Firm Shares in accordance with the terms hereof, and the amount of Firm Shares
not purchased aggregates more than 10% of the total amount of Firm Shares set
forth in Schedule II hereto, and arrangements satisfactory to you for the
purchase of such Firm Shares by other persons are not made within 36 hours
thereafter, this Agreement shall terminate. In the event of any such termination
neither the Company nor any Selling Shareholder shall be under any liability to
any Underwriter (except to the extent provided in Section 4(a)(viii), Section
4(b)(ii) and Section 6 hereof) nor shall any Underwriter (other than an
Underwriter who shall have failed, otherwise than for some reason permitted
under this Agreement, to purchase the amount of Firm Shares agreed by such
Underwriter to be purchased hereunder) be under any liability to the Company or
the Selling Shareholders (except to the extent provided in Section 6 hereof).
If Firm Shares to which a default relates are to be purchased by the
non-defaulting Underwriter or by any other party or parties, the Representatives
or the Company shall have the right to postpone the First Closing Date for not
more than seven business days in order that the necessary changes in the
Registration Statement, Prospectus and any other documents, as well as any other
arrangements, may
29
be effected. As used herein, the term "Underwriter" includes any person
substituted for an Underwriter under this Section 8.
9. Effective Date of this Agreement and Termination.
(a) This Agreement shall become effective at 10:00 a.m., Central time, on
the first full business day following the effective date of the Registration
Statement, or at such earlier time after the effective time of the Registration
Statement as you in your discretion shall first release the Securities for sale
to the public; provided, that if the Registration Statement is effective at the
time this Agreement is executed, this Agreement shall become effective at such
time as you in your discretion shall first release the Securities for sale to
the public. For the purpose of this Section, the Securities shall be deemed to
have been released for sale to the public upon release by you of the publication
of a newspaper advertisement relating thereto or upon release by you of telexes
offering the Securities for sale to securities dealers, whichever shall first
occur. By giving notice as hereinafter specified before the time this Agreement
becomes effective, you, as Representatives of the several Underwriters, or the
Company may prevent this Agreement from becoming effective without liability of
any party to any other party, except that the provisions of Section 4(a)(viii),
Section 4(b)(ii) and Section 6 hereof shall at all times be effective.
(b) You, as Representatives of the several Underwriters, shall have the
right to terminate this Agreement by giving notice as hereinafter specified at
any time at or prior to the First Closing Date, and the option referred to in
Section 3(b), if exercised, may be canceled at any time prior to the Second
Closing Date, if (i) the Company shall have failed, refused or been unable, at
or prior to such Closing Date, to perform any agreement on its part to be
performed hereunder, (ii) any other condition of the Underwriters' obligations
hereunder is not fulfilled, (iii) trading on the New York Stock Exchange or the
Nasdaq National Market shall have been wholly suspended, (iv) minimum or maximum
prices for trading shall have been fixed, or maximum ranges for prices for
securities shall have been required, on the New York Stock Exchange or the
Nasdaq National Market, by such Exchange or by order of the Commission or any
other governmental authority having jurisdiction, (v) a banking moratorium shall
have been declared by Federal, New York or Minnesota authorities, or (vi) there
has occurred any material adverse change in the financial markets in the United
States or an outbreak of major hostilities (or an escalation thereof) in which
the United States is involved, a declaration of war by Congress, any other
substantial national or international calamity or any other event or occurrence
of a similar character shall have occurred since the execution of this Agreement
that, in your judgment, makes it impractical or inadvisable to proceed with the
completion of the sale of and payment for the Securities. Any such termination
shall be without liability of any party to any other party except that the
provisions of Section 4(a)(viii), Section 4(b)(ii) and Section 6 hereof shall at
all times be effective.
(c) If you elect to prevent this Agreement from becoming effective or to
terminate this Agreement as provided in this Section, the Company and an
Attorney-in-Fact, on behalf of the Selling Shareholders, shall be notified
promptly by you by telephone or telegram, confirmed by letter. If
30
the Company elects to prevent this Agreement from becoming effective, you and an
Attorney-in-Fact, on behalf of the Selling Shareholders, shall be notified by
the Company by telephone or telegram, confirmed by letter.
10. Default by One or More of the Selling Shareholders or the Company. If
one or more of the Selling Shareholders shall fail at the First Closing Date to
sell and deliver the number of Securities which such Selling Shareholder or
Selling Shareholders are obligated to sell hereunder, and the remaining Selling
Shareholders do not exercise the right hereby granted to increase, pro rata or
otherwise, the number of Securities to be sold by them hereunder to the total
number of Securities to be sold by all Selling Shareholders as set forth in
Schedule I, then the Underwriters may at your option, by notice from you to the
Company and the non-defaulting Selling Shareholders, either (a) terminate this
Agreement without any liability on the part of any non-defaulting party or (b)
elect to purchase the Securities which the Company and the non-defaulting
Selling Shareholders have agreed to sell hereunder.
In the event of a default by any Selling Shareholder as referred to in this
Section, either you or the Company or, by joint action only, the non-defaulting
Selling Shareholders shall have the right to postpone the First Closing Date for
a period not exceeding seven days in order to effect any required changes in the
Registration Statement or Prospectus or in any other documents or arrangements.
If the Company shall fail at the First Closing Date to sell and deliver the
number of Securities which it is obligated to sell hereunder, then this
Agreement shall terminate without any liability on the part of any
non-defaulting party.
No action taken pursuant to this Section shall relieve the Company or any
Selling Shareholders so defaulting from liability, if any, in respect of such
default.
11. Information Furnished by Underwriters. The statements set forth in the
last paragraph of the cover page and under the caption "Underwriting" in any
Preliminary Prospectus and in the Prospectus constitute the written information
furnished by or on behalf of the Underwriters referred to in Section 2 and
Section 6 hereof.
12. Notices. Except as otherwise provided herein, all communications
hereunder shall be in writing or by telegraph and, if to the Underwriters, shall
be mailed, telegraphed or delivered to the Representatives c/o U.S. Bancorp
Xxxxx Xxxxxxx Inc., Xxxxx Xxxxxxx Tower, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxxxx,
Xxxxxxxxx 00000, except that notices given to an Underwriter pursuant to Section
6 hereof shall be sent to such Underwriter at the address stated in the
Underwriters' Questionnaire furnished by such Underwriter in connection with
this offering; if to the Company, shall be mailed, telegraphed or delivered to
it at BUCA, Inc., 0000 Xxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxxxxx, Xxxxxxxxx
00000, Attention: Xxxx X. Xxxxx; if to any of the Selling Shareholders, at the
address of the Attorneys-in-Fact as set forth in the Powers of Attorney, or in
each case to such other address as the
31
person to be notified may have requested in writing. All notices given by
telegram shall be promptly confirmed by letter. Any party to this Agreement may
change such address for notices by sending to the parties to this Agreement
written notice of a new address for such purpose.
13. Persons Entitled to Benefit of Agreement. This Agreement shall inure to
the benefit of and be binding upon the parties hereto and their respective
successors and assigns and the controlling persons, officers and directors
referred to in Section 6. Nothing in this Agreement is intended or shall be
construed to give to any other person, firm or corporation any legal or
equitable remedy or claim under or in respect of this Agreement or any provision
herein contained. The term "successors and assigns" as herein used shall not
include any purchaser, as such purchaser, of any of the Securities from any of
the several Underwriters.
14. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Minnesota.
32
Please sign and return to the Company the enclosed duplicates of this
letter whereupon this letter will become a binding agreement between the
Company, the Selling Shareholders and the several Underwriters in accordance
with its terms.
Very truly yours,
BUCA, Inc.
By
------------------------------------
Title:
Selling Shareholders:
Xxxxxxxx X. Xxxxxxx
By:
-----------------------------------
Name:
Xxxxxx Xxxxxxx
By:
-----------------------------------
Name:
Xxxx X. Xxxxxxxxxxxxxx
By:
-----------------------------------
Name:
Xxxx Xxxxxxxxxx
By:
-----------------------------------
Name:
Xxxxxx X. Xxxxxxx
By:
-----------------------------------
Name:
Xxx X. Xxxx
By:
-----------------------------------
Name:
Xxxx Family Limited Partnership
By:
-----------------------------------
Name:
Xxxxx Xxxx Revocable Trust
By:
-----------------------------------
Name:
Xxxxx X. Xxxxxxxx
By:
-----------------------------------
Name:
Mihajlov Family Limited Partnership
By:
-----------------------------------
Name:
Xxxxxx X. Xxxxxxxx
By:
-----------------------------------
Name:
Xxxxxx X. Xxxxxxxxxx
By:
-----------------------------------
Name:
Xxxx X. Xxxxx
By:
-----------------------------------
Name:
Xxxxxxx X. Xxxxxxx
By:
-----------------------------------
Name:
Confirmed as of the date first above
mentioned, on behalf of themselves and
the other several Underwriters named in
Schedule II hereto
U.S. BANCORP XXXXX XXXXXXX INC.
BANC OF AMERICA SECURITIES LLC
BANCBOSTON XXXXXXXXX XXXXXXXX INC.
By U.S. BANCORP XXXXX XXXXXXX INC.
By
------------------------------------
Managing Director
33
SCHEDULE I
SELLING SHAREHOLDERS
Number of Firm Number of Option
Name Shares To Be Sold Shares to Be Sold
---------------------- ----------------------- ------------------------
Xxxxxxxx X. Xxxxxxx 10,000 0
Xxxxxx Xxxxxxx 10,000 0
Xxxx X. Xxxxxxxxxxxxxx 3,833 0
Xxxx Xxxxxxxxxx 9,866 0
Xxxxxx X. Xxxxxxx 0 100,000
Xxx X. Xxxx 0 60,000
Xxxx Family Limited Partnership 0 20,000
Xxxxx Xxxx Revocable Trust 0 20,000
Xxxxx X. Xxxxxxxx 0 50,000
Xxxxxx X. Xxxxxxxx 0 25,000
Mihajlov Family Limited Partnership 0 25,000
Xxxxxx X. Xxxxxxxxxx 0 70,000
Xxxx X. Xxxxx 0 24,665
Xxxxxxx X. Xxxxxxx 0 5,333
----------------------- ------------------------
Total 33,699 399,998
======================= ========================
SCHEDULE I(a)
Xxxx X. Xxxxxxxxxxxxxx
Xxxx Xxxxxxxxxx
Xxxxxx X. Xxxxxxx
Xxx X. Xxxx
Xxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxxxx
Xxxx X. Xxxxx
Xxxxxxx X.Xxxxxxx
SCHEDULE I(b)
Xxxxxxxx X. Xxxxxxx
Xxxxxx Xxxxxxx
SCHEDULE II
Number of Firm
Underwriter Shares (1)
--------------------------------------------- -----------------------
U.S. Bancorp Xxxxx Xxxxxxx Inc.
Banc of America Securities LLC
BancBoston Xxxxxxxxx Xxxxxxxx Inc.
Total 3,033,699
=======================
-----------------
(1) The Underwriters may purchase up to an additional 455,05 Option Shares, to
the extent the option described in Section 3(b) of the Agreement is
exercised, in the proportions and in the manner described in the Agreement.
