Exhibit 1.1
EXECUTED COPY
12,500,000
EVERGREEN SOLAR, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
February 3, 2005
XX XXXXX & CO., LLC
FIRST ALBANY CAPITAL INC.
As Representatives of the several Underwriters
c/o XX Xxxxx & Co., LLC
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
1. INTRODUCTORY. Evergreen Solar, Inc., a Delaware corporation (the "Company"),
proposes to sell, pursuant to the terms of this Agreement, to the several
underwriters named in Schedule A hereto (collectively, the "Underwriters" and,
each, an "Underwriter"), an aggregate of 12,500,000 shares of common stock, $.01
par value, of the Company (the "Common Stock"). The aggregate of 12,500,000
shares so proposed to be sold is hereinafter referred to as the "Firm Stock."
The Company also proposes to sell to the Underwriters, upon the terms and
conditions set forth in Section 3 hereof, up to an additional 1,875,000 shares
of Common Stock (the "Optional Stock"). The Firm Stock and the Optional Stock
are hereinafter collectively referred to as the "Stock." XX Xxxxx & Co., LLC
("XX Xxxxx") and First Albany Capital Inc. are acting as representatives of the
several Underwriters and in such capacity are hereinafter referred to as the
"Representatives."
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents and
warrants to, and agrees with, the several Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-119864) in respect
of the Stock has been filed with the Securities and Exchange Commission
(the "Commission"); such registration statement and any amendments thereto
(the "Initial Registration Statement"), each in the form heretofore
delivered to you, and, excluding exhibits thereto but including all
documents incorporated by reference in the prospectus contained therein, to
you for each of the other Underwriters, have been declared
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effective by the Commission in such form; other than a registration
statement, if any, increasing the size of the offering contemplated hereby
(a "Rule 462(b) Registration Statement"), filed pursuant to Rule 462(b)
under the Securities Act of 1933, as amended (the "Securities Act"), and
the rules and regulations of the Commission thereunder (the "Rules and
Regulations"), which became or will become effective upon filing, no other
document with respect to the Initial Registration Statement or document
incorporated by reference therein has heretofore been filed with the
Commission; and no stop order suspending the effectiveness of the Initial
Registration Statement, any post-effective amendment thereto or the Rule
462(b) Registration Statement, if any, has been issued and no proceeding
for that purpose has been initiated or threatened by the Commission (any
preliminary prospectus contained in the Initial Registration Statement or
filed with the Commission pursuant to Rule 424 of the Rules and
Regulations, including any supplement thereto, relating to the offering of
the Stock is hereinafter referred to as a "Preliminary Prospectus"); the
various parts of the Initial Registration Statement and the Rule 462(b)
Registration Statement, if any, including all exhibits thereto and
including the documents incorporated by reference in the prospectus
contained in the Initial Registration Statement at the time such part of
the Initial Registration Statement became effective, each as amended at the
time such part of the Initial Registration Statement became effective or
such part of the Rule 462(b) Registration Statement, if any, became or
hereafter becomes effective, are hereinafter collectively referred to as
the "Registration Statements"; the final prospectus that discloses the
public offering price of the Stock and other matters relating to the
offering thereof, in the form first filed pursuant to Rule 424(b) of the
Rules and Regulation, including any supplement to the prospectus contained
in the Initial Registration Statement, is hereinafter referred to as the
"Prospectus"; any reference herein to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the
Securities Act as of the date of such Preliminary Prospectus or the
Prospectus, as the case may be (it being expressly understood that, as
provided in Rule 412 of the Rules and Regulations, any statement contained
in any such document so incorporated by reference shall not be deemed to
constitute a part of the Registration Statement, any Preliminary Prospectus
or the Prospectus to the extent that it is modified or superseded by a
statement contained in the Registration Statement, any Preliminary
Prospectus or the Prospectus or in any other subsequently filed document
that also is or is deemed to be so incorporated by reference), together
with, solely for purposes of Section 7(a) hereof, the information under
Item 2.02 of the Company's Current Report on Form 8-K dated January 14,
2004, as amended by its Current Report on Form 8-K/A dated January 21,
2004, in each case furnished pursuant to Section 13(a) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"); any reference to any
amendment or supplement to any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include any documents filed after the date
of such Preliminary Prospectus or the Prospectus, as the case may be, under
the Exchange Act and incorporated by reference in such Preliminary
Prospectus or
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the Prospectus, as the case may be; and any reference to any amendment to
the Registration Statements shall be deemed to refer to and include any
annual report of the Company filed pursuant to Section 13(a) or 15(d) of
the Exchange Act after the effective date of the Initial Registration
Statement that is incorporated by reference in the Registration Statements.
No document has been or will be prepared or distributed in reliance on Rule
434 under the Securities Act. No order preventing or suspending the use of
any Preliminary Prospectus has been issued by the Commission.
(b) The Initial Registration Statement conforms, and the Rule 462(b)
Registration Statement, if any, the Prospectus and any amendments or
supplements to either of the Registration Statements or the Prospectus,
when they become effective or are filed with the Commission, as the case
may be, will conform, in all material respects to the requirements of the
Securities Act and the Rules and Regulations and do not and will not, in
the case of the Registration Statements and any amendment thereto, as of
the applicable effective date, contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and, in the case of
the Prospectus and any amendment or supplement thereto, as of the
applicable filing date, contain an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that the foregoing representations and
warranties shall not apply to information contained in or omitted from the
Registration Statements or the Prospectus or any such amendment or
supplement thereto in reliance upon, and in conformity with, written
information furnished to the Company through the Representatives by or on
behalf of any Underwriter specifically for inclusion therein, which
information the parties hereto agree is limited to the Underwriters'
Information (as defined in Section 16 hereof).
(c) The documents incorporated by reference in the Prospectus, when they
were filed with the Commission, conformed in all material respects to the
requirements of the Exchange Act and the rules and regulations of the
Commission thereunder; and any further documents so filed and incorporated
by reference in the Prospectus, when such documents are filed with
Commission, will conform in all material respects to the requirements of
the Exchange Act and the rules and regulations of the Commission
thereunder.
(d) The Company and each of its subsidiaries (as defined in Section 14
hereof) have been duly incorporated or organized and are validly existing
as corporations or other legal entities in good standing under the laws of
their respective jurisdictions of organization, are duly qualified to do
business and are in good standing as foreign corporations or other legal
entities in each jurisdiction in which their respective ownership or lease
of property or the conduct of their respective businesses requires
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such qualification and have all corporate power and authority (or, in the
case of such subsidiaries, similar power and authority) necessary to own or
hold their respective properties and to conduct the businesses in which
they are engaged, except where the failure to so qualify, be in good
standing or have such power or authority would not have, singularly or in
the aggregate, a material adverse effect on the condition (financial or
otherwise), results of operations, business or prospects of the Company and
its subsidiaries taken as a whole (a "Material Adverse Effect"). The
Company owns or controls, directly or indirectly, only the following
entities with the indicated percentages of ownership: (i) Evergreen Solar
Securities Corp., a Massachusetts corporation (100%) ("Evergreen
Securities"); (ii) EverQ GmbH (formerly TOPAS 107 V.V. GmbH), a German
limited liability company (75.1%) ("EverQ"); and (iii) Evergreen Solar
GmbH, a German limited liability company (100%) (together with EverQ, the
"German Subsidiaries").
(e) This Agreement has been duly authorized executed and delivered by the
Company.
(f) The Stock to be issued and sold by the Company to the Underwriters
hereunder has been duly and validly authorized and, when issued and
delivered against payment therefor as provided herein, will be duly and
validly issued, fully paid and nonassessable and free of any preemptive or
similar rights and will conform to the description thereof in the
Prospectus.
(g) The Company's authorized, issued and outstanding capital stock conforms
to the description thereof in the Prospectus, and all of the issued shares
of capital stock of the Company have been duly and validly authorized and
issued, are fully paid and nonassessable, have been issued in compliance
with federal and state securities laws and conform to the description
thereof contained in the Prospectus. None of the outstanding shares of
Common Stock was issued in violation of any preemptive rights, rights of
first refusal or other similar rights to subscribe for or purchase
securities of the Company. There are no authorized or outstanding options,
warrants, preemptive rights, rights of first refusal or other rights to
purchase, or equity or debt securities convertible into or exchangeable or
exercisable for, any capital stock of the Company or any of its
subsidiaries other than those accurately described in the Prospectus. The
description of the Company's stock option, stock bonus and other stock
plans or arrangements, and the options or other rights granted thereunder,
included or incorporated by reference in the Prospectus accurately and
fairly present the information required to be shown with respect to such
plans, arrangements, options and rights.
(h) All the outstanding shares of capital stock of each subsidiary of the
Company have been duly authorized and validly issued, are fully paid and
nonassessable and, except to the extent described in the Prospectus, are
owned by the Company directly or indirectly through one or more
wholly-owned subsidiaries (it being expressly understood that the Company
does not own all of the outstanding shares of EverQ), free
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and clear of any claim, lien, encumbrance, security interest, restriction
upon voting or transfer or any other claim of any third party.
(i) The execution, delivery and performance of this Agreement by the
Company and the consummation of the transactions contemplated hereby will
not conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed
of trust, loan agreement or other material agreement or instrument to which
the Company or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries is bound or to which any of the property or
assets of the Company or any of its subsidiaries is subject, nor will such
actions result in any violation of the provisions of the charter or bylaws
of the Company or any of its subsidiaries or any statute or any order, rule
or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties or assets.
(j) Except for the registration of the Stock under the Securities Act and
such consents, approvals, authorizations, registrations or qualifications
as may be required under the Exchange Act and applicable state securities
laws, the National Association of Securities Dealers, Inc. and the Nasdaq
National Market in connection with the purchase and distribution of the
Stock by the Underwriters, no consent, approval, authorization or order of,
or filing or registration with, any court or governmental or regulatory
agency or body is required for the execution, delivery and performance of
this Agreement by the Company and the consummation of the transactions
contemplated hereby.
(k) PricewaterhouseCoopers LLP, who have expressed their opinions on the
audited financial statements included or incorporated by reference in the
Registration Statements and the Prospectus, are independent registered
public accountants with respect to the Company and its subsidiaries as
required by the Securities Act and the Rules and Regulations, including
Rule 2-01 of Regulation S-X of the Rules and Regulations.
(l) The financial statements, together with the related notes, included or
incorporated by reference in the Prospectus and in each Registration
Statement present fairly the financial position and the results of
operations and changes in financial position of the Company and its
consolidated subsidiaries at the respective dates or for the respective
periods therein specified. Such statements and related notes have been
prepared in accordance with United States generally accepted accounting
principles applied on a consistent basis except as may be set forth in the
Prospectus. The financial statements, together with the related notes,
included in the Prospectus comply in all material respects with the
Securities Act and the Rules and Regulations. No other financial statements
or exhibits and no supporting schedules are required by the Securities Act
or the Rules and Regulations thereunder to be included in the Prospectus.
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(m) Neither the Company nor any of its subsidiaries has sustained, since
the date of the latest audited financial statements included or
incorporated by reference in the Prospectus, any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as described
in or contemplated by the Prospectus; and, since such date, there has not
been any change in the capital stock (other than upon the issuance of
shares pursuant to the Company's stock option and incentive plan or
employee stock purchase plan as in existence on the date hereof or pursuant
to its currently outstanding options, warrants or rights, in each case as
described in the Prospectus, all of which issuances have been or will be
made in compliance with the Securities Act and the Rules and Regulations)
or long-term debt of the Company or any of its subsidiaries or any material
adverse change, or any development involving a prospective material adverse
change, in or affecting the business, general affairs, management,
financial position, stockholders' equity or results of operations of the
Company and its subsidiaries taken as a whole, otherwise than as set forth
or contemplated in the Prospectus.
(n) Except as described in the Prospectus, there is no legal or
governmental proceeding pending to which the Company or any of its
subsidiaries is a party or of which any property or assets of the Company
or any of its subsidiaries is the subject that is required to be described
in the Registration Statements or the Prospectus and is not described
therein or that, singularly or in the aggregate, if determined adversely to
the Company or any of its subsidiaries, would have a Material Adverse
Effect or prevent or adversely affect the ability of the Company to perform
its obligations under this Agreement; and to the Company's knowledge, no
such proceedings are threatened or contemplated by governmental authorities
or threatened by others.
(o) Neither the Company nor any of its subsidiaries (i) is in violation of
its charter or bylaws (or similar organizational documents), (ii) is in
default in any respect, and no event has occurred that, with notice or
lapse of time or both, would constitute such a default, in the due
performance or observance of any term, covenant or condition contained in
any indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which it is a party or by which it is bound or to which
any of its property or assets is subject or (iii) is in violation in any
respect of any law, ordinance, governmental rule, regulation or court
decree to which it or its property or assets may be subject, except, in the
case of clauses (ii) and (iii) above, any violations or defaults that,
singularly or in the aggregate, would not have a Material Adverse Effect.
(p) The Company and each of its subsidiaries possess all licenses,
certificates, authorizations and permits issued by, and have made all
declarations and filings with, the appropriate state, federal or foreign
regulatory agencies or bodies that are necessary for the ownership of their
respective properties or the conduct of their respective
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businesses as described in the Prospectus except where any failures to
possess or make the same, singularly or in the aggregate, would not have a
Material Adverse Effect, and the Company has not received written
notification or, to its knowledge, other notification of any revocation or
modification of any such license, authorization or permit, except where
such revocation or modification or lack of renewal would not, singularly or
in the aggregate, have a Material Adverse Effect.
(q) The Company is not and, after giving effect to the offering of the
Stock and the receipt and application of the proceeds thereof as described
in the Prospectus, will not be an "investment company" or entity controlled
by an "investment company" within the meaning of the Investment Company Act
of 1940, as amended (the "Investment Company Act"), and the rules and
regulations of the Commission thereunder.
(r) Neither the Company nor any of its officers or directors has taken or
will take, and the Company has used and will use reasonable efforts to
cause each of its affiliates not to have taken or take, directly or
indirectly, any action designed or intended to stabilize or manipulate the
price of any security of the Company or that caused or resulted in, or that
might in the future reasonably be expected to cause or result in,
stabilization or manipulation of the price of any security of the Company.
(s) The Company and its subsidiaries own or possess the right to use all
patents, trademarks, trademark registrations, service marks, service xxxx
registrations, trade names, copyrights, licenses, inventions, know-how,
trade secrets and rights (collectively, "Intellectual Property") described
in the Prospectus as being owned or licensed by them for the conduct of
their respective businesses, and the Company has not received written or,
to its knowledge, other notice of any claim to the contrary or any
challenge by any other person to the rights of the Company and its
subsidiaries with respect to the foregoing. Except as described in the
Prospectus, (i) to the Company's knowledge, the conduct of the Company's
business does not and will not infringe or conflict with any Intellectual
Property or franchise right of any person and (ii) no written or, to the
Company's knowledge, other claim has been made against the Company alleging
the infringement by the Company or any of its licensees or other third
parties of any Intellectual Property or franchise right of any person,
except for such as would not have a Material Adverse Effect. Each employee
of and consultant to the Company and its subsidiaries has entered into a
confidentiality and invention assignment agreement in favor of the Company
or its applicable subsidiary as a condition of the employment or retention
of services of such employee or consultant, except where failure to enter
into such an agreement would not have a Material Adverse Effect. Except for
matters relating to third parties expressly identified and named in the
Prospectus: (A) to the Company's knowledge, there are no rights of third
parties to any Intellectual Property owned by or licensed to the Company or
any of its subsidiaries that conflict with the rights of the Company or its
subsidiaries related to such Intellectual Property, except for any such
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rights that, singularly or in the aggregate, would not have a Material
Adverse Effect; (B) to the Company's knowledge, there is no infringement by
third parties of any Intellectual Property owned by or licensed to the
Company or its subsidiaries that would have a Material Adverse Effect; (C)
other than in connection with assertions or inquiries made by patent office
examiners in the ordinary course of the prosecution of the patent
applications of the Company or its subsidiaries, there is no pending or, to
the Company's knowledge, threatened action, suit, proceeding or other claim
by others challenging the rights of the Company or any of its subsidiaries
in or to, or the validity or scope of, any Intellectual Property owned by
or licensed to the Company or its subsidiaries, except for any such claim
that would not have a Material Adverse Effect, and, to the Company's
knowledge, there are no facts that would form a reasonable basis for any
such claim; (D) there is no pending or, to the Company's knowledge,
threatened action, suit, proceeding or other claim by others that the
Company or any of its subsidiaries, or any of their respective licensees,
infringes or otherwise violates, or would infringe or otherwise violate
upon commercialization of its products and product candidates described in
the Prospectus, any patent, trademark, copyright, trade secret or other
proprietary rights of others, and there are no facts that would form a
reasonable basis for any such claim by others that the Company or any of
its subsidiaries, or any of their respective licensees, infringes or
otherwise violates, or would infringe or otherwise violate upon
commercialization of its products and product candidates described in the
Prospectus, any Intellectual Property of others, except, in each case in
this clause (D), for any such claims that would not have a Material Adverse
Effect; and (E) to the Company's knowledge, there is no patent or patent
application that contains claims that conflict with any Intellectual
Property described in the Prospectus as being owned by or licensed to the
Company or any of its subsidiaries or that is necessary for the conduct of
their respective businesses as currently or contemplated to be conducted,
except for such as would not have a Material Adverse Effect.
(t) The Company and each of its subsidiaries have good and marketable title
in fee simple to, or have valid rights to lease or otherwise use, all items
of real or personal property that are material to the business of the
Company and its subsidiaries taken as a whole, in each case free and clear
of all liens, encumbrances, claims and defects, except as described in the
Prospectus or for those that would not result in a Material Adverse Effect.
(u) No labor disturbance by the employees of the Company or any of its
subsidiaries exists or, to the Company's knowledge, is threatened that
would reasonably be expected to have a Material Adverse Effect. To the
Company's knowledge, no key employee or significant group of employees of
the Company or any subsidiary plans to terminate employment with the
Company or any such subsidiary.
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(v) No "prohibited transaction" (as defined in Section 406 of the Employee
Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder ("ERISA"), or Section
4975 of the Internal Revenue Code of 1986, as amended from time to time
(the "Code"), and not otherwise exempt from treatment as a "prohibited
transaction") or "accumulated funding deficiency" (as defined in Section
302 of ERISA) or any of the events set forth in Section 4043(b) of ERISA
(other than events with respect to which the 30-day notice requirement
under Section 4043 of ERISA has been waived) has occurred with respect to
any employee benefit plan that could have a Material Adverse Effect; each
employee benefit plan is in compliance in all material respects with
applicable law, including ERISA and the Code; the Company has not incurred
and does not expect to incur liability under Title IV of ERISA with respect
to the termination of, or withdrawal from, any "pension plan"; and each
"pension plan" (as defined in ERISA) for which the Company would have any
liability that is intended to be qualified under Section 401(a) of the Code
is so qualified in all material respects and nothing has occurred, whether
by action or by failure to act, that could cause the loss of such
qualification.
(w) Neither the Company nor any of its subsidiaries is in violation of any
foreign, federal, state or local rules, laws or regulations relating to the
use, treatment, storage and disposal of toxic substances and the protection
of health or the environment ("Environmental Laws") that are applicable to
its business, except for any such violations that would not, singularly or
in the aggregate, have a Material Adverse Effect; neither the Company nor
any of its subsidiaries has received any written or, to their knowledge,
other notice from any governmental authority or third party of an asserted
claim under Environmental Laws; each of the Company and its subsidiaries
has received all permits, licenses or other approvals required of it under
applicable Environmental Laws to conduct its business and is in compliance
with all terms and conditions of any such permit, license or approval,
except for the lack of such permits, licenses or approvals or for such
non-compliance as would not, singularly or in the aggregate, have a
Material Adverse Effect; and to the Company's knowledge, there is no claim,
action or cause of action filed with a court or governmental authority, no
investigation with respect to which the Company or any of its subsidiaries
has received notice and no notice by any other person or entity alleging
potential liability for investigatory costs, cleanup costs, governmental
response costs, natural resources damages, property damages, personal
injuries, attorneys' fees or penalties arising out of, based on or
resulting from the storage, generation, transportation, handling,
treatment, disposal, discharge, emission or other release of any kind of
toxic or other wastes or other hazardous substances by, due to or caused by
the Company or any of its subsidiaries (or any other entity for whose acts
or omissions the Company or any of its subsidiaries is or may be liable)
upon any of the property now or previously owned or leased by the Company
or any of its subsidiaries in violation of any statute or any ordinance,
rule, regulation, order, judgment, decree or permit that would, under any
Environmental Law, give rise to any
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liability, except for any violation or liability that would not have,
singularly or in the aggregate with all such violations and liabilities, a
Material Adverse Effect.
(x) The Company has reviewed the effect of Environmental Laws on the
business, operations and properties of the Company and its subsidiaries,
during which the Company identified and evaluated associated costs and
liabilities (including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or compliance
with Environmental Laws, or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to third
parties); and on the basis of such review, the Company has reasonably
concluded that such associated costs and liabilities would not, singly or
in the aggregate, have a Material Adverse Effect.
(y) Each of the Company and its subsidiaries (i) has filed all necessary
federal, state and foreign income and franchise tax returns that are
required to be filed through the date hereof, (ii) has paid all federal
state, local and foreign taxes due and payable for which it is liable
through the date hereof and (iii) does not have any tax deficiency or
claims outstanding or assessed or, to the Company's knowledge, proposed
against it other than those filings, payments or deficiencies that would
not, singularly or in the aggregate, have a Material Adverse Effect.
(z) To the Company's knowledge, the operations of the Company and its
subsidiaries are and have been conducted at all times in compliance with
applicable financial recordkeeping and reporting requirements of the
Currency and Foreign Transactions Reporting Act of 1970, as amended, the
money laundering statutes of all jurisdictions, the rules and regulations
thereunder and any related or similar rules, regulations or guidelines,
issued, administered or enforced by any governmental agency (collectively,
the "Money Laundering Laws"), except for any such non-compliance as would
not, singularly or in the aggregate, have a Material Adverse Effect, and no
action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or any of it
subsidiaries with respect to the Money Laundering Laws is pending or, to
the Company's knowledge, threatened.
(aa) Neither the Company nor any of its subsidiaries nor, to the Company's
knowledge, any director, officer, agent, employee or affiliate of the
Company or any of its subsidiaries is currently subject to any U.S.
sanctions administered by the Office of Foreign Assets Control of the U.S.
Treasury Department; and the Company will not directly or indirectly use
the proceeds of the offering of the Stock, or lend, contribute or otherwise
make available such proceeds to any subsidiary, joint venture partner or
other person or entity, for the purpose of financing the activities of any
person currently subject to any U.S. sanctions administered by such office.
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(bb) The Company and each of its subsidiaries carry, or are covered by,
insurance in such amounts and covering such losses and risks as is prudent
and customary in the businesses in which they are engaged.
(cc) The Company and each of its subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurances
that (i) transactions are executed in accordance with management's general
or specific authorizations, (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with United States
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.
(dd) There is no franchise, lease, contract, agreement or document required
by the Securities Act or by the Rules and Regulations to be described in
the Prospectus or to be filed as an exhibit to the Registration Statements
that is not described or filed therein as required; and all descriptions of
any such franchises, leases, contracts, agreements or documents contained
in the Registration Statements are accurate and complete descriptions of
such documents in all material respects. Other than as described in the
Prospectus, no such franchise, lease, contract or agreement has been
suspended or terminated for convenience or default by the Company or, to
the knowledge of the Company, any of the other parties thereto, and the
Company has not received written or, to its knowledge, other notice of any
such pending or threatened suspension or termination, except for such
pending or threatened suspensions or terminations that would not reasonably
be expected to, singularly or in the aggregate, have a Material Adverse
Effect.
(ee) No relationship, direct or indirect, exists between or among the
Company, on the one hand, and the directors, officers, stockholders,
customers or suppliers of the Company, on the other hand, that is required
to be described in the Prospectus and that is not so described.
(ff) No person or entity has the right to require registration of shares of
Common Stock or other securities of the Company because of the filing or
effectiveness of the Registration Statements or otherwise in connection
with the offering and sale of the Stock as contemplated by the Prospectus,
except for persons and entities who have expressly waived such right or who
have been given timely and proper notice and have failed to exercise such
right within the time or times required under the terms and conditions of
such right or whose right to incidental registration are solely dependent
on the inclusion of any such shares in such registration by persons or
entities who have waived such rights and except as otherwise set forth in
the Prospectus.
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(gg) Neither the Company nor any of its subsidiaries is a party to any
contract, agreement or understanding with any person that would give rise
to a valid claim against the Company or the Underwriters for a brokerage
commission, finder's fee or like payment in connection with the offering
and sale of the Stock as contemplated by the Prospectus.
(hh) No forward-looking statement (within the meaning of Section 27A of the
Securities Act and Section 21E of the Exchange Act) contained in the
Prospectus has been made or reaffirmed without a reasonable basis or has
been disclosed other than in good faith.
(ii) The Stock is quoted on the Nasdaq National Market.
(jj) The Company is in compliance with all applicable provisions of the
Xxxxxxxx-Xxxxx Act of 2002 and all rules and regulations promulgated
thereunder or implementing the provisions thereof (collectively, the
"Xxxxxxxx-Xxxxx Act") that are currently in effect and is actively taking
steps to ensure that it will be in compliance with other applicable
provisions of the Xxxxxxxx-Xxxxx Act not currently in effect upon and at
all times after the effectiveness of such provisions.
(kk) The Company is in compliance with all applicable corporate governance
requirements set forth in the Nasdaq Marketplace Rules that are currently
in effect and is actively taking steps to ensure that it will be in
compliance with other applicable corporate governance requirements set
forth in the Nasdaq Marketplace Rules not currently in effect upon and at
all times after the effectiveness of such requirements.
(ll) Neither the Company nor any of its subsidiaries nor, to the Company's
knowledge, any employee or agent of the Company or any subsidiary, has made
any contribution or other payment to any official of, or candidate for, any
federal, state or foreign office in violation of any law or of the
character required to be disclosed in the Prospectus.
(mm) There are no transactions, arrangements or other relationships between
or among the Company or, to its knowledge, any of its affiliates (as such
term is defined in Rule 405 of the Rules and Regulations), on the one hand,
and any unconsolidated entity, on the other hand, including, without
limitation, any structured finance, special purpose or limited purpose
entity that could reasonably be expected to materially affect the Company's
liquidity or the availability of or requirements for its capital resources
required to be described in the Prospectus that have not been described as
required.
3. PURCHASE SALE AND DELIVERY OF OFFERED SECURITIES. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company agrees to sell to each
Underwriter, and each Underwriter agrees, severally
13
and not jointly, to purchase from the Company, the number of shares of Firm
Stock set forth opposite the name of such Underwriter in Schedule A hereto.
The purchase price per share to be paid by the Underwriters to the Company
for the Stock will be $4.70 per share (the "Purchase Price").
The Company will deliver the Firm Stock to the Representatives for the
respective accounts of the several Underwriters (in the form of definitive
certificates, issued in such names and in such denominations as the
Representatives may direct by notice in writing to the Company given at or prior
to 12:00 Noon, New York time, on the second full business day preceding the
First Closing Date (as defined below) against payment of the aggregate Purchase
Price per share to be paid for the Firm Stock by wire transfer to an account at
a bank mutually acceptable to the Company and XX Xxxxx, payable to the order of
the Company, all at the offices of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, counsel for
the Company, 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx. Time shall be of the
essence, and delivery at the time and place specified pursuant to this Agreement
is a further condition of the obligations of each Underwriter hereunder. The
time and date of the delivery and closing shall be at 10:00 A.M., New York time,
on February 9, 2005, in accordance with Rule 15c6-1 under the Exchange Act. The
time and date of such payment and delivery are herein referred to as the "First
Closing Date." The First Closing Date and the location of delivery of, and the
form of payment for, the Firm Stock may be varied by agreement between the
Company and XX Xxxxx.
The Company shall make the certificates for the Firm Stock available to the
Representatives for examination on behalf of the Underwriters in New York, New
York at least twenty-four hours prior to the First Closing Date.
For the purpose of covering any over-allotments in connection with the
distribution and sale of the Firm Stock as contemplated by the Prospectus, the
Underwriters may purchase all or less than all of the Optional Stock. The price
per share to be paid for the Optional Stock shall be the Purchase Price. The
Company agrees to sell to the Underwriters the number of shares of Optional
Stock specified in any written notice by XX Xxxxx described below and the
Underwriters agree, severally and not jointly, to purchase such shares of
Optional Stock. Such shares of Optional Stock shall be purchased from the
Company for the account of each Underwriter in the same proportion as the number
of shares of Firm Stock set forth opposite such Underwriter's name bears to the
total number of shares of Firm Stock (subject to adjustment by XX Xxxxx to
eliminate fractions). The option granted hereby may be exercised as to all or
any part of the Optional Stock at any time, and from time to time, not more than
thirty (30) days subsequent to the date of this Agreement, provided that such
option may not be exercised more than a total of three (3) times. No Optional
Stock shall be sold and delivered unless the Firm Stock previously has been, or
simultaneously is, sold and delivered. The right to purchase the Optional Stock
or any portion thereof may be surrendered and terminated at any time upon notice
by XX Xxxxx to the Company.
14
The option granted hereby may be exercised by written notice being given to
the Company by XX Xxxxx setting forth the number of shares of the Optional Stock
to be purchased by the Underwriters and the date and time for delivery of and
payment for such Optional Stock. Each date and time for delivery of and payment
for any Optional Stock (which may be the First Closing Date, but not earlier) is
herein referred to as an "Option Closing Date" and shall in no event be earlier
than two (2) business days nor later than five (5) business days after written
notice is given. (Each Option Closing Date and the First Closing Date are herein
referred to as the "Closing Dates.")
The Company will deliver the Optional Stock specified in any written notice
by XX Xxxxx described above to the Underwriters (in the form of definitive
certificates, issued in such names and in such denominations as the
Representatives may direct by notice in writing to the Company given at or prior
to 12:00 Noon, New York time, on the business day preceding the Option Closing
Date for such Optional Stock against payment of the aggregate Purchase Price
therefor per share to be paid for such Optional Stock in federal (same day)
funds by certified or official bank check or checks or wire transfer to an
account at a bank acceptable to XX Xxxxx payable to the order of the Company all
at the offices of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, counsel for the Company, 00
Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx. Time shall be of the essence, and delivery
at the time and place specified pursuant to this Agreement is a further
condition of the obligations of each Underwriter hereunder. The Company shall
make the certificates for such Optional Stock available to the Representatives
for examination on behalf of the Underwriters in New York, New York not later
than 10:00 A.M., New York Time, on the business day preceding such Option
Closing Date. Such Option Closing Date and the location of delivery of, and the
form of payment for, such Optional Stock may be varied by agreement between the
Company and XX Xxxxx.
The several Underwriters propose to offer the Stock for sale upon the terms
and conditions set forth in the Prospectus.
4. FURTHER AGREEMENTS OF THE COMPANY. The Company agrees with the several
Underwriters that:
(a) The Company will prepare the Rule 462(b) Registration Statement, if
necessary, in a form approved by the Representatives and file such Rule
462(b) Registration Statement with the Commission on the date hereof;
prepare the Prospectus in a form approved by the Representatives and file
such Prospectus pursuant to Rule 424(b) of the Rules and Regulations Act
not later than the second business day following the execution and delivery
of this Agreement; make no further amendment or any supplement to the
Registration Statements or to the Prospectus to which the Representatives
shall reasonably object by notice to the Company after a reasonable period
to review; advise the Representatives, promptly after it receives notice
thereof, of the time when any amendment to either Registration Statement
has been filed or becomes effective or any supplement to the Prospectus or
any amended Prospectus has
15
been filed and to furnish the Representatives with copies thereof; file
promptly all reports and any definitive proxy or information statements
required to be filed by the Company with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the
Prospectus and for so long as the delivery of a prospectus is required in
connection with the offering or sale of the Stock; advise the
Representatives, promptly after it receives notice thereof, of the issuance
by the Commission of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or the Prospectus, of the
suspension of the qualification of the Stock for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for any
such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statements or the Prospectus or for
additional information; and, in the event of the issuance of any stop order
or of any order preventing or suspending the use of any Preliminary
Prospectus or the Prospectus or suspending any such qualification, use
promptly its best efforts to obtain its withdrawal.
(b) If at any time after the date of this Agreement when a prospectus
relating to the Stock is required to be delivered any event occurs as a
result of which the Prospectus as then amended or supplemented would
include any untrue statement of a material fact, or omit to state any
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus or to file under the Exchange
Act any document incorporated by reference in the Prospectus to comply with
the Securities Act or the Exchange Act, the Company will promptly notify
the Representatives thereof and upon their request will prepare an amended
or supplemented Prospectus or make an appropriate filing pursuant to
Section 13 or 14 of the Exchange Act that will correct such statement or
omission or effect such compliance. The Company will furnish without charge
to each Underwriter and to any dealer in securities as many copies as the
Representatives may from time to time reasonably request of such amended or
supplemented Prospectus. Notwithstanding the foregoing, if any Underwriter
is required to deliver a prospectus relating to the Stock nine months or
more after the date of this Agreement, the preparation and furnishing of
such amended or supplemented Prospectus or the making of such filing shall
be at the expense of such Underwriter.
(c) To furnish promptly to each of the Representatives and to counsel for
the Underwriters a signed copy of each of the Registration Statements as
originally filed with the Commission, and each amendment thereto filed with
the Commission, including all consents and exhibits filed therewith.
(d) To deliver promptly to the Representatives in New York City such number
of the following documents as the Representatives shall reasonably request:
(i) conformed copies of the Registration Statements as originally filed
with the Commission and each
16
amendment thereto (in each case excluding exhibits), (ii) each Preliminary
Prospectus, (iii) the Prospectus (not later than 10:00 A.M., New York time,
of the business day following the execution and delivery of this Agreement)
and any amended or supplemented Prospectus (not later than 10:00 A.M., New
York time, on the business day following the date of such amendment or
supplement) and (iv) any document incorporated by reference in the
Prospectus (excluding exhibits thereto).
(e) To make generally available to its stockholders as soon as practicable,
but in any event not later than eighteen months after the effective date of
the Registration Statements (as defined in Rule 158(c) of the Rules and
Regulations), an earnings statement of the Company and its subsidiaries
(which need not be audited) complying with Section 11(a) of the Securities
Act and the Rules and Regulations (including, at the option of the Company,
such Rule 158).
(f) The Company will promptly take from time to time such actions as the
Representatives may reasonably request to qualify the Stock for offering
and sale under the securities or Blue Sky laws of such jurisdictions as the
Representatives may designate and to continue such qualifications in effect
for so long as required for the distribution of the Stock; provided that
the Company and its subsidiaries shall not be obligated to qualify as
foreign corporations in any jurisdiction in which they are not so
qualified, to file a general consent to service of process in any
jurisdiction or to subject itself to taxation in any jurisdiction in which
it is otherwise not so subject.
(g) During the period of five years from the date hereof, but only to the
extent not available on the Commission's website, the Company will deliver
to the Representatives and, upon reasonable request, to each of the other
Underwriters, as soon as they are available, copies of (i) all reports or
other communications furnished to stockholders and (i) all reports and
financial statements furnished or filed with the Commission pursuant to the
Exchange Act or any national securities exchange or automatic quotation
system on which the Stock is listed or quoted.
(h) The Company will not directly or indirectly offer, sell, assign,
transfer, pledge or contract to sell, or otherwise dispose of, any shares
of or securities convertible into or exercisable or exchangeable for Common
Stock, or announce the offering of or file any registration statement under
the Securities Act in respect of, any shares of or securities convertible
into or exercisable or exchangeable for Common Stock, in each case for a
period of 90 days from the date of the Prospectus without the prior written
consent of XX Xxxxx other than the Company's sale of the Stock hereunder
and the issuance of shares pursuant to the Company's stock option and
incentive plan or employee stock purchase plan as in existence on the date
hereof or pursuant to its currently outstanding options, warrants or
rights, in each case as described in the Prospectus, all of which issuances
will be made in compliance with the Securities Act and the Rules and
Regulations; provided, however, that if (A) the Company issues an earnings
release or
17
material news or a material event relating to the Company occurs during the
last 17 days of such 90-day period or (B) prior to the expiration of such
90-day period, the Company announces that it will release earnings results
during the 16-day period beginning on the last day of such 90-day period,
the restrictions imposed by this Section 4(h) shall continue to apply until
the expiration of the 18-day period beginning on the issuance of such
earnings release or the occurrence of such material news or material event.
The Company will cause each officer, director and stockholder listed in
Schedule B to furnish to the Representatives, prior to the First Closing
Date, a letter, substantially in the form of Exhibit I hereto.
(i) The Company will supply the Representatives with copies of all
correspondence to and from, and all documents issued to and by, the
Commission in connection with the registration of the Stock under the
Securities Act.
(j) Prior to each of the Closing Dates the Company will furnish to the
Representatives, as soon as they have been prepared, copies of any
unaudited interim consolidated financial statements of the Company for any
periods subsequent to the periods covered by the financial statements
appearing in the Registration Statements and the Prospectus.
(k) Prior to each of the Closing Dates, the Company will not issue any
press release or other communication directly or indirectly or hold any
press conference with respect to the Company, its condition, financial or
otherwise, or earnings, business affairs or business prospects (except for
routine marketing communications in the ordinary course of business and
consistent with the past practices of the Company and of which the
Representatives are notified), without the prior written consent of the
Representatives, unless in the judgment of the Company and its counsel, and
after notification to the Representatives, such press release or
communication is required by law.
(l) In connection with the offering of the Stock, until XX Xxxxx shall have
notified the Company of the completion of the resale of the Stock, the
Company will not, and will use reasonable efforts to cause its affiliated
purchasers (as defined in Regulation M under the Exchange Act) not to,
either alone or with one or more other persons, bid for or purchase, for
any account in which it or any of its affiliated purchasers has a
beneficial interest, any Stock, or attempt to induce any person to purchase
any Stock; and the Company will not, and will use reasonable efforts to
cause its affiliated purchasers not to, make bids or purchase for the
purpose of creating actual, or apparent, active trading in or of raising
the price of the Stock.
(m) The Company shall at all times continue to comply, in all material
respects, with all applicable provisions of the Xxxxxxxx-Xxxxx Act in
effect from time to time.
18
(n) The Company will apply the net proceeds from the sale of the Stock as
set forth in the Prospectus under the heading "Use of Proceeds."
5. PAYMENT OF EXPENSES. The Company agrees with the Underwriters to pay (a) the
costs incident to the authorization, issuance, sale, preparation and delivery of
the Stock and any taxes payable in that connection; (b) the costs incident to
the registration of the Stock under the Securities Act; (c) the costs incident
to the preparation, printing and distribution of the Registration Statements,
any Preliminary Prospectus and the Prospectus any amendments and exhibits
thereto or any document incorporated by reference therein, the costs of
printing, reproducing and distributing the "Agreement Among Underwriters"
between the Representatives and the Underwriters, the Master Selected Dealers'
Agreement, the Underwriters' Questionnaire and this Agreement by mail, telex or
other means of communications; (d) the reasonable fees and expenses (including
any related and documented fees and expenses of counsel for the Underwriters)
incurred in connection with filings, if any, under Conduct Rules 2710 or 2720 of
the National Association of Securities Dealers; (e) any applicable listing or
other fees; (f) the reasonable fees and expenses of qualifying the Stock under
the securities laws of the several jurisdictions as provided in Section 4(f)
hereof and of preparing, printing and distributing Blue Sky Memoranda and Legal
Investment Surveys (including related and documented fees and expenses of
counsel for the Underwriters not to exceed $5,000); (g) all fees and expenses of
the registrar and transfer agent of the Stock; (h) the costs and expenses
relating to investor presentations on any "road show" undertaken in connection
with the marketing of the offering of the Stock (including the reasonable costs
and expenses of the Underwriters), including, without limitation, expenses
associated with the production of road show slides and graphics, fees and
expenses of any consultants engaged by the Company in connection with the road
show presentations with the prior approval of the Company, travel and lodging
expenses of representatives and officers of the Company, the Underwriters and
any such consultants and the cost of any aircraft chartered with the Company's
prior approval in connection with such road show; and (i) all other costs and
expenses incident to the performance of the obligations of the Company under
this Agreement (including, without limitation, the fees and expenses of the
Company's counsel and the Company's independent accountants); provided that,
except as otherwise provided in this Section 5 and in Section 9 hereof, the
Underwriters shall pay their own costs and expenses, including the fees and
expenses of their counsel, any transfer taxes on the Stock that they may sell
and the expenses of advertising any offering of the Stock made by the
Underwriters.
6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The respective obligations of the
several Underwriters hereunder are subject to the accuracy, when made and on
each of the Closing Dates, of the representations and warranties of the Company
contained herein, to the accuracy of the statements of the Company made in any
certificates pursuant to the provisions hereof, to the performance by the
Company of their obligations hereunder, and to each of the following additional
terms and conditions:
19
(a) No stop order suspending the effectiveness of either the Registration
Statements shall have been issued and no proceedings for that purpose shall
have been initiated or threatened by the Commission, and any request for
additional information on the part of the Commission (to be included in the
Registration Statements or the Prospectus or otherwise) shall have been
complied with to the reasonable satisfaction of the Representatives. The
Rule 462(b) Registration Statement, if any, and the Prospectus shall have
been timely filed with the Commission in accordance with Section 4(a)
hereof.
(b) None of the Underwriters shall have discovered and disclosed to the
Company on or prior to such Closing Date that either of the Registration
Statements or the Prospectus or any amendment or supplement thereto
contains an untrue statement of a fact that, in the opinion of counsel for
the Underwriters, is material or omits to state any fact that, in the
opinion of such counsel, is material and is required to be stated therein
or is necessary to make the statements therein not misleading.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of each of this Agreement, the Stock, the
Registration Statements and the Prospectus and all other legal matters
relating to this Agreement and the transactions contemplated hereby shall
be reasonably satisfactory in all material respects to counsel for the
Underwriters, and the Company shall have furnished to such counsel all
documents and information that such counsel may reasonably request to
enable them to pass upon such matters.
(d) Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx shall have furnished to the
Representatives such counsel's written opinion, as counsel for the Company,
addressed to the Underwriters and dated such Closing Date, in form and
substance reasonably satisfactory to the Representatives, to the effect
that:
(i) The Company is a corporation duly incorporated and validly
existing and in good standing under the laws of the State of
Delaware. The Company has the corporate power and authority to
own its properties and assets, and to carry on its business as
described in the Prospectus.
(ii) Evergreen Securities is a corporation duly incorporated and
validly existing and in good standing under the laws of the
Commonwealth of Massachusetts. Evergreen Securities has the
corporate power and authority to own its properties and assets,
and to carry on its business as presently conducted.
(iii) The authorized capital stock of the Company conforms as to legal
matters to the description thereof in the Prospectus.
20
(iv) The Stock being delivered on the Closing Date has been duly
authorized and, when issued and delivered in accordance with the
terms of this Agreement, will be validly issued, fully paid and
nonassessable.
(v) To such counsel's knowledge, all the outstanding shares of
capital stock of Evergreen Securities have been duly authorized;
and except to the extent set forth in the Prospectus, the shares
of capital stock of each subsidiary of the Company are owned by
the Company directly or indirectly through one or more
wholly-owned subsidiaries, free and clear of any claim, lien,
encumbrance, security interest, restriction upon voting or
transfer or any other claim of any third party.
(vi) The stockholders of the Company have no preemptive rights
contained in the Company's charter or bylaws; and to such
counsel's knowledge, the stockholders of the Company do not have
contractual, written preemptive rights with the Company with
respect to the Stock that have not otherwise been waived.
(vii) This Agreement has been duly authorized, executed and delivered
by the Company.
(viii) The execution and delivery by the Company of this Agreement, the
performance by the Company of its obligations hereunder and the
issuance and sale of the Stock will not (A) violate any
provisions of the Company's charter or bylaws or any provisions
of any applicable federal or state law, rule or regulation known
to us to be customarily applicable to transactions of this
nature, (B) violate, or constitute a default under, any contract
or agreement filed as an exhibit pursuant to Item 601(b)(4) or
601(b)(10) of Regulation S-K to any document filed by the Company
under the Exchange Act and incorporated by reference in the
Prospectus or (C) any order known to such counsel of any
governmental agency or body or court having jurisdiction over the
Company or any of its subsidiaries or any of their properties or
assets.
(ix) Except for the registration of the Stock under the Securities Act
and such consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and
applicable state securities laws in connection with the purchase
and distribution of the Stock by the Underwriters, no consent,
approval or authorization of, or designation, declaration, filing
or registration with, any governmental authority is required on
the part of the Company for the execution and delivery of this
Agreement or the offer, issuance or sale by the Company of the
Stock.
21
(x) The statements in the Prospectus under the headings "Principal
Stockholders," "Description of Capital Stock" and "Certain United
States Federal Tax Considerations," insofar as such statements
constitute summaries of legal matters, documents or proceedings
referred to therein, fairly present, in all material respects,
the information called for with respect to such legal matters,
documents and proceedings and fairly summarize the matters
referred to therein in all material respects.
(xi) Such counsel does not know of any legal or governmental
proceedings required to be described in the Registration
Statement or the Prospectus that are not described in all
material respects therein as required nor of any contracts or
documents of a character required to be filed as exhibits to the
Registration Statement that are not filed as required.
(xii) To such counsel's knowledge and other than as set forth in the
Prospectus, there are no legal or governmental proceedings
pending to which the Company or any of its subsidiaries is a
party or of which any property or asset of the Company or any of
its subsidiaries is the subject that, singularly or in the
aggregate, if determined adversely to the Company or any of its
subsidiaries, might have a Material Adverse Effect or would
prevent or adversely affect the ability of the Company to perform
its obligations under this Agreement; and to such counsel's
knowledge, no such proceedings have been threatened in writing by
governmental authorities or threatened in writing by others.
(xiii) The Registration Statement was declared effective under the
Securities Act, the Rule 462(b) Registration Statement, if any,
was filed with the Commission on the date specified therein, the
Prospectus was filed with the Commission pursuant to the
subparagraph of Rule 424(b) of the Rules and Regulations
specified in such opinion on the date specified therein and, to
such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statements has been issued and,
to such counsel's knowledge, no proceeding for that purpose has
been instituted or is pending by the Commission.
(xiv) To such counsel's knowledge, no person or entity has the right
to require registration of shares of Common Stock or other
securities of the Company in connection with the offering and
sale of the Stock by the Company as contemplated by the
Prospectus, except for persons and entities who have expressly
waived such right or who have been given timely and proper notice
and have failed to exercise such right within the time or times
required under the terms and conditions of such right or whose
right to incidental registration are solely dependent on the
22
(xv) inclusion of any such shares in such registration by persons or
entities who have waived such rights and except as otherwise
described in the Prospectus.
(xvi) The Company is not, and after giving effect to the offering of
the Stock and the receipt and application of the proceeds thereof
as described in the Prospectus will not be, required to register
as an "investment company" as such term is defined in the
Investment Company Act and the rules and regulations of the
Commission thereunder.
Such counsel shall also have furnished to the Representatives a written
statement, addressed to the Underwriters and dated such Closing Date, in
form and substance satisfactory to the Representatives, to the effect that
(A) such counsel has acted as counsel for the Company in connection with
the preparation of the Initial Registration Statement and the Prospectus
and (B) based on such counsel's examination of the Initial Registration
Statement and the Prospectus and such counsel's investigations made in
connection with the preparation of the Initial Registration Statement and
the Prospectus and conferences with certain officers and employees of and
auditors and patent counsel for the Company and with you and counsel for
the Underwriters, at which conferences the contents of the Initial
Registration Statement and the Prospectus and related matters were reviewed
and discussed, no facts have come to such counsel's attention through such
review and discussion as described therein that have caused such counsel to
believe that (1) as of its effective date, the Initial Registration
Statement contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading or (2) as of its issue date or the
date hereof, the Prospectus or any amendment or supplement thereto
contained an untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and such counsel
shall confirm that (x) each of the Registration Statements, as of the
respective effective dates, and the Prospectus, as of its date, and any
further amendments or supplements thereto, as of their respective dates,
made by the Company prior to such Closing Date complied as to form in all
material respects with the requirements of the Securities Act and the Rules
and Regulations and (y) the documents incorporated by reference in the
Prospectus, when they were filed with the Commission, complied as to form
in all material respects with the requirements of the Exchange Act and the
rules and regulations of the Commission thereunder; it being understood
that such counsel need express no opinion as to the financial statements or
other financial data contained or incorporated by reference in the Initial
Registration Statement or the Prospectus.
The foregoing opinion and statement may be qualified by a statement to the
effect that such counsel has not independently verified the accuracy,
completeness or fairness of
23
the statements contained in the Initial Registration Statement or the
Prospectus and takes no responsibility therefor except to the extent set
forth in the opinion described in clause (x) above.
(e) Xxxxxx Xxxxxxx shall have furnished to the Representatives such
counsel's written opinion, as German counsel for the Company, addressed to
the Underwriters and dated such Closing Date, in form and substance
reasonably satisfactory to the Representatives, to the effect that:
(i) The German Subsidiaries have been duly organized and are validly
existing as corporations under the laws of the Federal Republic
of Germany and are duly qualified to do business in Germany and,
to our knowledge, in each jurisdiction in which their respective
ownership or lease of property or the conduct of their respective
businesses requires such qualification and have all power and
authority necessary to own or hold their respective properties
and to conduct the businesses in which they are engaged, except
where the failure to so qualify or have such power or authority
would not have, singularly or in the aggregate a Material Adverse
Effect; and to such counsel's knowledge, the German Subsidiaries
are only engaged in business in Germany.
(ii) All registered shares of capital stock of each of the German
Subsidiaries have been duly authorized and validly issued, are
fully paid and nonassessable and are, to such counsel's
knowledge, except to the extent set forth in the Prospectus,
owned by the Company directly; and to such counsel's knowledge,
all of such outstanding shares are registered or, with respect to
a capital increase contemplated in the organizational documents
of the German Subsidiaries, will be registered.
(iii) The execution, delivery and performance of this Agreement by the
Company and the consummation of the transactions contemplated
herein will not conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default
under any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument known to such counsel after
reasonable investigation to which either German Subsidiary is a
party or by which either German Subsidiary is bound or to which
any of the properties or assets of either German Subsidiary is
subject, nor will such actions result in any violation of the
Articles of Association (or similar organizational documents such
as the Master Joint Venture Agreement) of either German
Subsidiary or any statute or law or any order known to such
counsel or any rule or regulation of any governmental agency or
body or court having jurisdiction over either German Subsidiary
or any of their respective properties or assets.
24
(iv) To such counsel's knowledge, neither German Subsidiary (A) is in
violation of its organizational documents, (B) is in default, and
no event has occurred that, with notice or lapse of time or both,
would constitute a default, in the due performance or observance
of any term, covenant or condition contained in any agreement or
instrument to which it is a party or by which it is bound or to
which any of its properties or assets is subject or (C) is in
violation of any law, ordinance, governmental rule, regulation or
court decree to which it or its property or assets may be subject
or has failed to obtain any license, permit, certificate,
franchise or other governmental authorization or permit necessary
to the ownership of its property or to the conduct of its
business except, in the case of clauses (B) and (C), for those
defaults, violations or failures that, either individually or in
the aggregate, would not have a Material Adverse Effect.
(v) To such counsel's knowledge and other than as set forth in the
Prospectus, there are no legal or governmental proceedings
pending to which either German Subsidiary is a party or of which
any property or asset of either German Subsidiary is the subject
that, singularly or in the aggregate, if determined adversely to
either German Subsidiary, might have a Material Adverse Effect or
would prevent or adversely affect the ability of the Company to
perform its obligations under this Agreement; and to such
counsel's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others.
(f) The Representatives shall have received a written opinion from
Proskauer Rose LLP, as counsel for the Company as to certain matters
involving Intellectual Property of the Company and its subsidiaries,
addressed to the Underwriters and dated such Closing Date, in substantially
the forms thereof attached as Exhibit II hereto.
(g) The Representatives shall have received from Pillsbury Winthrop LLP,
counsel for the Underwriters, such written opinion or opinions, dated such
Closing Date, with respect to such matters as the Underwriters may
reasonably require, and the Company shall have furnished to such counsel
such documents as they request for enabling them to pass upon such matters.
(h) At the time of the execution of this Agreement, the Representatives
shall have received from PricewaterhouseCoopers LLP, a letter, addressed to
the Underwriters and dated such date, in form and substance satisfactory to
the Representatives (i) confirming that they are independent registered
public accountants with respect to the Company and its subsidiaries within
the meaning of the Securities Act and the Rules and Regulations and (ii)
stating the conclusions and findings of such firm with respect to the
financial statements and certain financial information contained or
incorporated by reference in the Prospectus, including statements and
information of the type ordinarily
25
included in accountant's "comfort letters" to underwriters delivered in
accordance with Statement of Auditing Standards No. 72 (or any successor
thereto).
(i) On each Closing Date, the Representatives shall have received a letter
(each, a "bring-down letter") from PricewaterhouseCoopers LLP, addressed to
the Underwriters and dated such Closing Date confirming, as of the date of
such bring-down 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 three
business days prior to the date of such bring-down letter), the conclusions
and findings of such firm with respect to the financial information and
other matters covered by its letter delivered to the Representatives
concurrently with the execution of this Agreement pursuant to Section 6(h)
hereof.
(j) The Company shall have furnished to the Representatives a certificate,
dated such Closing Date, of its Chairman of the Board, its President or a
Vice President and its chief financial officer stating that (i) such
officers have carefully examined the Registration Statements and the
Prospectus and, in their opinion, the Registration Statements, as of their
respective effective dates, and the Prospectus, as of its date or at such
Closing Date, did not include any untrue statement of a material fact and
did not omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (ii) since the
effective date of the Initial Registration Statement, no event has occurred
that should have been set forth in a supplement or amendment to the
Registration Statements or the Prospectus, (iii) to their knowledge after
reasonable investigation, as of such Closing Date, the other
representations and warranties of the Company set forth in this Agreement
are true and correct and the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied hereunder
at or prior to such Closing Date and (iv) subsequent to the date of the
most recent financial statements included or incorporated by reference in
the Prospectus, there has been no material adverse change in the financial
position or results of operation of the Company and its subsidiaries, or
any change, or any development including a prospective change, in or
affecting the condition (financial or otherwise), results of operations,
business or prospects of the Company and its subsidiaries taken as a whole,
except as set forth in the Prospectus.
(k) Neither the Company nor any of its subsidiaries shall have sustained
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any loss or interference with
its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental
action, order or decree, otherwise than as set forth or contemplated in the
Prospectus and (ii) since such date there shall not have been any change in
the capital stock or long-term debt of the Company or any of its
subsidiaries or any change, or any development involving a prospective
change, in or affecting the business, general
26
affairs, management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as set forth
or contemplated in the Prospectus, the effect of which, in any such case
described in clause (i) or (ii) above, is, in the judgment of the
Representatives, so material and adverse as to make it impracticable or
inadvisable to proceed with the sale or delivery of the Stock on the terms
and in the manner contemplated in the Prospectus.
(l) No action shall have been taken and no statute, rule, regulation or
order shall have been enacted, adopted or issued by any governmental agency
or body that would, as of such Closing Date, prevent the issuance or sale
of the Stock or materially and adversely affect or potentially materially
and adversely affect the business or operations of the Company; and no
injunction, restraining order or order of any other nature by any federal
or state court of competent jurisdiction shall have been issued as of such
Closing Date that would prevent the issuance or sale of the Stock or
materially and adversely affect or potentially materially and adversely
affect the business or operations of the Company.
(m) Subsequent to the execution and delivery of this Agreement there shall
not have occurred any of the following: (i) trading in securities generally
on the New York Stock Exchange or the American Stock Exchange or in the
over-the-counter market, or trading in any securities of the Company on any
exchange or in the over-the-counter market, shall have been suspended or
minimum or maximum prices or maximum range for prices shall have been
established on any such exchange or such market by the Commission, by such
exchange or by any other regulatory body or governmental authority having
jurisdiction, (ii) a banking moratorium shall have been declared by Federal
or state authorities or a material disruption has occurred in commercial
banking or securities settlement or clearance services in the United
States, (iii) the United States shall have become engaged in hostilities,
or the subject of an act of terrorism, or there shall have been an
escalation in hostilities involving the United States, or there shall have
been a declaration of a national emergency or war by the United States or
(iv) there shall have occurred such a material adverse change in general
economic, political or financial conditions (or the effect of international
conditions on the financial markets in the United States shall be such) so
as to make it, in the judgment of the Representatives, impracticable or
inadvisable to proceed with the sale or delivery of the Stock on the terms
and in the manner contemplated in the Prospectus.
(n) XX Xxxxx shall have received the written agreements, substantially in
the form of Exhibit I hereto, of the officers, directors and stockholders
of the Company listed in Schedule B to this Agreement in accordance with
Section 4(h) hereof.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
27
7. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company shall indemnify and hold harmless each Underwriter, its
members, officers, employees, representatives and agents and each person,
if any, who controls any Underwriter within the meaning of the Securities
Act (collectively, the "Underwriter Indemnified Parties" and, each, an
"Underwriter Indemnified Party") against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which
that Underwriter Indemnified Party may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage, liability or action
arises out of or is based upon (i) any untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus,
either of the Registration Statements or the Prospectus or in any amendment
or supplement thereto, (ii) the omission or alleged omission to state in
any Preliminary Prospectus, either of the Registration Statements or the
Prospectus or in any amendment or supplement thereto a material fact
required to be stated therein or necessary to make the statements therein
not misleading or (iii) any act or failure to act, or any alleged act or
failure to act, by any Underwriter in connection with, or relating in any
manner to, the Stock or the offering contemplated hereby and that is
included as part of or referred to in any loss, claim, damage, liability or
action arising out of or based upon matters covered by clause (i) or (ii)
above (provided that the Company shall not be liable in the case of any
matter covered by this clause (iii) to the extent that it is determined in
a final judgment by a court of competent jurisdiction that such loss,
claim, damage, liability or action resulted directly from any such act or
failure to act undertaken or omitted to be taken by such Underwriter
through its gross negligence or willful misconduct) and shall reimburse
each Underwriter Indemnified Party promptly upon demand for any legal or
other expenses reasonably incurred by that Underwriter Indemnified Party in
connection with investigating or preparing to defend or defending against
or appearing as a third party witness in connection with any such loss,
claim, damage, liability or action as such expenses are incurred; provided,
however, that the Company 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 in or
omission or alleged omission from any Preliminary Prospectus, either of the
Registration Statements or the Prospectus or any such amendment or
supplement in reliance upon and in conformity with written information
furnished to the Company through the Representatives by or on behalf of any
Underwriter specifically for use therein, which information the parties
hereto agree is limited to the Underwriter's Information; provided further,
however, that the foregoing indemnification agreement with respect to any
Preliminary Prospectus shall not inure to the benefit of any Underwriter
from whom the person asserting any such loss, claim, damage or liability
purchased Securities, or any members, officers, employees, representatives,
agents or controlling persons of such Underwriter, if (A) a copy of the
Prospectus (as then amended or supplemented) was required by law to be
delivered to such person at or prior to the written confirmation of the
sale of Securities
28
(b) to such person, (B) a copy of the Prospectus (as then amended or
supplemented), excluding documents incorporated by reference therein, was
not sent or given to such person by or on behalf of such Underwriter and
such failure was not due to non-compliance by the Company with Section 4(d)
hereof and (C) the Prospectus (as so amended or supplemented) would have
cured the defect giving rise to such loss, claim, damage or liability.
This indemnity agreement is not exclusive and will be in addition to
any liability that the Company might otherwise have and shall not limit any
rights or remedies that may otherwise be available at law or in equity to
each Underwriter Indemnified Party.
(b) Each Underwriter, severally and not jointly, shall indemnify and hold
harmless the Company its officers, employees, representatives and agents,
each of its directors and each person, if any, who controls the Company
within the meaning of the Securities Act (collectively the "Company
Indemnified Parties" and, each, a "Company Indemnified Party") against any
loss, claim, damage or liability, joint or several, or any action in
respect thereof, to which the Company Indemnified Parties may become
subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of or is based upon (i) any
untrue statement or alleged untrue statement of a material fact contained
in any Preliminary Prospectus, either of the Registration Statements or the
Prospectus or in any amendment or supplement thereto or (ii) the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, but in
each case only to the extent that the 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 through the
Representatives by or on behalf of that Underwriter specifically for use
therein, and shall reimburse the Company Indemnified Parties for any legal
or other expenses reasonably incurred by such parties in connection with
investigating or preparing to defend or defending against or appearing as
third party witness in connection with any such loss, claim, damage,
liability or action as such expenses are incurred; provided that the
parties hereto hereby agree that such written information provided by the
Underwriters consists solely of the Underwriter's Information. This
indemnity agreement is not exclusive and will be in addition to any
liability that the Underwriters might otherwise have and shall not limit
any rights or remedies that may otherwise be available at law or in equity
to the Company Indemnified Parties.
(c) Promptly after receipt by an indemnified party under this Section 7 of
notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 7, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however,
that the failure to notify the indemnifying party shall not relieve it
29
from any liability that it may have under this Section 7 except to the
extent it has been materially prejudiced by such failure; and, provided,
further, that the failure to notify the indemnifying party shall not
relieve it from any liability that it may have to an indemnified party
otherwise than under this Section 7. If any such claim or action shall be
brought against an indemnified party, and it shall notify the indemnifying
party thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it wishes, jointly with any other similarly
notified indemnifying party, to assume the defense thereof with counsel
reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable
to the indemnified party under this Section 7 for any legal or other
expenses subsequently incurred by the indemnified party in connection with
the defense thereof other than reasonable costs of investigation; provided,
however, that any indemnified party shall have the right to employ separate
counsel in any such action and to participate in the defense thereof but
the fees and expenses of such counsel shall be at the expense of such
indemnified party unless (i) the employment thereof has been specifically
authorized by the indemnifying party in writing, (ii) such indemnified
party shall have been advised by such counsel that there may be one or more
legal defenses available to it that are different from or additional to
those available to the indemnifying party and in the reasonable judgment of
such counsel it is advisable for such indemnified party to employ separate
counsel or (iii) the indemnifying party has failed to assume the defense of
such action and employ counsel reasonably satisfactory to the indemnified
party, in which case, if such indemnified party notifies the indemnifying
party in writing that it elects to employ separate counsel at the expense
of the indemnifying party, the indemnifying party shall not have the right
to assume the defense of such action on behalf of such indemnified party,
it being understood, however, that the indemnifying party shall not, in
connection with any one such action or separate but substantially similar
or related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys at any time for all
such indemnified parties, which firm shall be designated in writing by XX
Xxxxx, if the indemnified parties under this Section 7 consist of any
Underwriter Indemnified Party, or by the Company if the indemnified parties
under this Section 7 consist of any Company Indemnified Parties. Each
indemnified party, as a condition of the indemnity agreements contained in
Sections 7(a) and 7(b) hereof, shall use all reasonable efforts to
cooperate with the indemnifying party in the defense of any such action or
claim. Subject to the provisions of Section 7(d) hereof, no indemnifying
party shall be liable for any settlement of any such action effected
without its written consent (which consent shall not be unreasonably
withheld), but if settled with its written consent or if there be a final
judgment for the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and
against any loss or liability by reason of such settlement or judgment.
30
(d) If at any time an indemnified party shall have requested that an
indemnifying party reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by this Section 7 effected without
its written consent if (i) such settlement is entered into more than 45
days after receipt by such indemnifying party of the request for
reimbursement, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement
being entered into and (iii) such indemnifying party shall not have
reimbursed such indemnified party in accordance with such request prior to
the date of such settlement.
(e) If the indemnification provided for in this Section 7 is unavailable or
insufficient to hold harmless an indemnified party under Section 7(a) or
7(b) hereof, then each indemnifying party shall, in lieu of indemnifying
such indemnified party, contribute to the amount paid or payable by such
indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, (i) in such proportion as shall be appropriate
to reflect the relative benefits received by the Company on the one hand
and the Underwriters on the other from the offering of the Stock 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 on the one hand and the Underwriters on the other with respect to
the statements or omissions that resulted in such loss, claim, damage or
liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company on
the one hand and the Underwriters on the other with respect to such
offering shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Stock purchased under this Agreement
(before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters with
respect to the Stock purchased under this Agreement, 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 on the one hand or the Underwriters on the other, the intent of the
parties and their relative knowledge, access to information and opportunity
to correct or prevent such untrue statement or omission; provided that the
parties hereto agree that the written information furnished to the Company
through the Representatives by or on behalf of the Underwriters for use in
any Preliminary Prospectus, either of the Registration Statements or the
Prospectus consists solely of the Underwriters' Information. The Company
and the Underwriters agree that it would not be just and equitable if
contributions pursuant to this Section 7(e) 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 that does not take into
account the equitable considerations referred to herein. The amount paid or
payable by an
31
indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section 7(e) shall be
deemed to include, for purposes of this Section 7(e), any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 7(e), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at
which the Stock underwritten by it and distributed to the public were
offered to the public less the amount of any damages that such Underwriter
has otherwise paid or become liable to pay by reason of any untrue or
alleged untrue statement or omission or alleged omission. No person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation.
The Underwriters' obligations to contribute as provided in this
Section 7(e) are several in proportion to their respective underwriting
obligations and not joint.
8. TERMINATION. The obligations of the Underwriters hereunder may be terminated
by XX Xxxxx, in its absolute discretion by notice given to and received by the
Company prior to delivery of and payment for the Firm Stock if, prior to that
time, any of the events described in Section 6(k) or 6(m) hereof have occurred
or if the Underwriters shall decline to purchase the Stock for any reason
permitted under this Agreement.
9. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If (a) the Company shall fail to
tender the Stock for delivery to the Underwriters for any reason not permitted
under this Agreement, (b) the Underwriters shall decline to purchase the Stock
for any reason permitted under this Agreement or (c) this Agreement shall have
been terminated pursuant to Section 10 hereof, then the Company shall reimburse
the Underwriters for the fees and expenses of their counsel and for such other
out-of-pocket expenses as shall have been reasonably incurred by them in
connection with this Agreement and the proposed purchase of the Stock, and upon
demand the Company shall pay the full amount thereof to the XX Xxxxx. If this
Agreement is terminated pursuant to Section 10 hereof by reason of the default
of one or more Underwriters, the Company shall not be obligated to reimburse any
defaulting Underwriter on account of those expenses.
10. SUBSTITUTION OF UNDERWRITERS. If any Underwriter or Underwriters shall
default in its or their obligations to purchase shares of Stock hereunder and
the aggregate number of shares that such defaulting Underwriter or Underwriters
agreed but failed to purchase does not exceed ten percent (10%) of the total
number of shares underwritten, the other Underwriters shall be obligated
severally, in proportion to their respective commitments hereunder, to purchase
the shares that such defaulting Underwriter or Underwriters agreed but failed to
purchase. If any Underwriter or Underwriters shall so default and the aggregate
number of shares with respect to which such default or defaults occur is more
than ten percent (10%) of the total number of shares underwritten and
arrangements satisfactory to the Representatives and the Company for
32
the purchase of such shares by other persons are not made within forty-eight
(48) hours after such default, this Agreement shall terminate.
If the remaining Underwriters or substituted Underwriters are required
hereby or agree to take up all or part of the shares of Stock of a defaulting
Underwriter or Underwriters as provided in this Section 10, (i) the Company
shall have the right to postpone the Closing Dates for a period of not more than
five (5) full business days in order that the Company may effect whatever
changes may thereby be made necessary in the Registration Statements or the
Prospectus, or in any other documents or arrangements, and the Company agrees
promptly to file any amendments to the Registration Statements or supplements to
the Prospectus that may thereby be made necessary, and (ii) the respective
numbers of shares to be purchased by the remaining Underwriters or substituted
Underwriters shall be taken as the basis of their underwriting obligation for
all purposes of this Agreement. Nothing herein contained shall relieve any
defaulting Underwriter of its liability to the Company or the other Underwriters
for damages occasioned by its default hereunder. Any termination of this
Agreement pursuant to this Section 10 shall be without liability on the part of
any non-defaulting Underwriter or the Company, except expenses to be paid or
reimbursed pursuant to Sections 5 and 9 hereof and except the provisions of
Section 7 hereof shall not terminate and shall remain in effect.
11. SUCCESSORS; PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall
inure to the benefit of and be binding upon the several Underwriters, the
Company and their respective successors. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person other than the
persons mentioned in the preceding sentence any legal or equitable right, remedy
or claim under or in respect of this Agreement, or any provisions herein
contained, this Agreement and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of such persons and
for the benefit of no other person; except that the representations, warranties,
covenants, agreements and indemnities of the Company contained in this Agreement
shall also be for the benefit of the Underwriter Indemnified Parties, and the
indemnities of the several Underwriters shall also be for the benefit of the
Company Indemnified Parties. It is understood that each Underwriter's
responsibility to the Company is solely contractual in nature and the
Underwriters do not owe the Company, or any other party, any fiduciary duty as a
result of this Agreement.
12. SURVIVAL OF INDEMNITIES, REPRESENTATIONS, WARRANTIES, ETC. The respective
indemnities, covenants, agreements, representations, warranties and other
statements of the Company and the several Underwriters, as set forth in this
Agreement or made by them respectively, pursuant to this Agreement, shall remain
in full force and effect, regardless of any investigation made by or on behalf
of any Underwriter, the Company or any person controlling any of them and shall
survive delivery of and payment for the Stock.
13. NOTICES. All statements, requests, notices and agreements hereunder shall be
in writing, and:
33
(a) if to the Underwriters, shall be delivered or sent by mail, telex or
facsimile transmission to XX Xxxxx & Co., LLC, 0000 Xxxxxx xx xxx Xxxxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Skip Grow, Managing Director (Fax:
000-000-0000), with a copy to XX Xxxxx & Co., LLC at the same address,
Attention: General Counsel (Fax: 000-000-0000); and
(b) if to the Company shall be delivered or sent by mail, telex or
facsimile transmission to Evergreen Solar, Inc. 000 Xxxxxxxx Xxxxxx,
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxxxxx, Chief
Financial Officer, Vice President, Treasurer and Secretary (Fax:
000-000-0000).
14. DEFINITION OF CERTAIN TERMS. For purposes of this Agreement, (a) "business
day" means any day on which the New York Stock Exchange, Inc. is open for
trading and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
15. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
16. UNDERWRITERS' INFORMATION. The parties hereto acknowledge and agree that,
for all purposes of this Agreement, the "Underwriters' Information" consists
solely of the following information in the Prospectus: (i) the last paragraph on
the front cover page of the Prospectus; and (ii) the statements contained in
paragraph 3 concerning the Underwriters, in the fourth sentence of paragraph 8
and in the first sentence of paragraph 9, in each case in the Prospectus under
the heading "Underwriting."
17. AUTHORITY OF THE REPRESENTATIVES. In connection with this Agreement, you
will act for and on behalf of the several Underwriters, and any action taken
under this Agreement by the Representatives will be binding on all the
Underwriters.
18. PARTIAL UNENFORCEABILITY. The invalidity or unenforceability of any Section,
paragraph or provision of this Agreement shall not affect the validity or
enforceability of any other Section, paragraph or provision hereof. If any
Section, paragraph or provision of this Agreement is for any reason determined
to be invalid or unenforceable, there shall be deemed to be made such minor
changes (and only such minor changes) as are necessary to make it valid and
enforceable.
19. GENERAL. This Agreement constitutes the entire agreement of the parties to
this Agreement and supersedes all prior written or oral and all contemporaneous
oral agreements, understandings and negotiations with respect to the subject
matter hereof. In this Agreement, the masculine, feminine and neuter genders and
the singular and the plural include one another. The section headings in this
Agreement are for the convenience of the parties only and will not affect the
construction or interpretation of this Agreement. This Agreement may be
34
amended or modified, and the observance of any term of this Agreement may be
waived, only by a writing signed by the Company and the Representatives.
20. COUNTERPARTS. This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
35
If the foregoing is in accordance with your understanding of the agreement
between the Company and the several Underwriters, kindly indicate your
acceptance in the space provided for that purpose below.
Very truly yours,
EVERGREEN SOLAR, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: CFO
Accepted as of
the date first above written:
XX XXXXX & CO., LLC
FIRST ALBANY CAPITAL INC.
Acting on their own behalf
and as Representatives of the several
Underwriters referred to in the
foregoing Agreement.
By: XX XXXXX & CO., LLC
By: /s/ Xxxxxxxx Grow
------------------------------------
Name: Xxxxxxxx Grow
Title: Managing Director
SCHEDULE A
Number of
Firm Shares
to be
Name Purchased
---- -----------
XX Xxxxx & Co., LLC ................. 8,375,000
First Albany Capital Inc. ........... 4,125,000
----------
Total ............................... 12,500,000
==========
SCHEDULE B
EXHIBIT I
[Form of Lock-Up Agreement]
January __, 2005
XX Xxxxx & Co., LLC
First Albany Capital Inc.
As representatives of the several Underwriters
c/o XX Xxxxx & Co., LLC
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Evergreen Solar, Inc. -- Public Offering of Shares of Common Stock
Dear Sirs:
In order to induce XX Xxxxx & Co., LLC ("XX Xxxxx") and First Albany
Capital Inc., on their own behalf and as representatives of the several
underwriters, to enter into a certain underwriting agreement with Evergreen
Solar, Inc., a Delaware corporation (the "Company"), with respect to the public
offering (the "Offering") of shares of the Company's Common Stock, par value
$.01 per share ("Common Stock"), registered under the Securities Act of 1933,
the undersigned hereby agrees that for a period from the date hereof until the
expiration of 90 days following the date of the final prospectus supplement
filed by the Company pursuant to the Securities Act of 1933 in connection with
the Offering (such period, the "lock-up period"), the undersigned will not,
without the prior written consent of XX Xxxxx, directly or indirectly, (i)
offer, sell, assign, transfer, pledge or contract to sell, or otherwise dispose
of, any shares of Common Stock, or any other securities convertible into or
exercisable or exchangeable for Common Stock, that are currently or hereafter
owned by the undersigned (including, without limitation, any such shares or
other securities that either currently or hereafter are registered in the name
of the undersigned or may be deemed to be beneficially owned by the undersigned
in accordance with the rules and regulations of the Securities and Exchange
Commission, including Rule 13d-3 under the Securities Exchange Act of 1934 (any
such shares or other securities, the "Securities"), (ii) enter into any swap,
hedge or similar agreement or arrangement that transfers, in whole or in part,
the economic risk of ownership of any of the Securities or (iii) engage in any
short selling of any of the Securities.
If (i) the Company issues an earnings release or material news or a
material event relating to the Company occurs during the last 17 days of the
lock-up period or (ii) prior to the expiration of the lock-up period, the
Company announces that it will release earnings results during the 16-day period
beginning on the last day of the lock-up period, then, if the Company and XX
Xxxxx mutually agree, the restrictions imposed by this Agreement shall continue
to apply until the expiration of the 18-day period beginning on the issuance of
such earnings release or the occurrence of such material news or material event.
The undersigned hereby acknowledges and agrees that written notice of
confirmation of the agreement to any extension of the lock-up period pursuant to
the previous paragraph will be delivered by or on behalf of XX Xxxxx to the
Company (in accordance with the notice provisions of the underwriting agreement
referred to in the first paragraph of this Agreement), which notice will be
promptly delivered by or on behalf of the Company to the undersigned at the
undersigned's address maintained by the transfer agent for the Common Stock, and
that any such notice so delivered will be deemed to have been given to, and
received by, the undersigned.
Anything contained herein to the contrary notwithstanding, any person to
whom any of the Securities are transferred from the undersigned shall be bound
by the terms of this Agreement.
In addition, the undersigned hereby waives, from the date hereof until the
expiration of the 90-day period following the date of the final prospectus
supplement filed by the Company pursuant to the Securities Act in connection
with the Offering, any and all rights, if any, to request or demand registration
of any of the Securities under the Securities Act of 1933, whether as result of
the registration of the Offering thereunder or otherwise, including any rights
to receive notice of the Offering or the registration thereof under the
Securities Act of 1933. In order to enable the aforesaid covenants to be
enforced, the undersigned hereby consents to the placing of legends and/or
stop-transfer orders with the transfer agent for the Common Stock with respect
to any of the Securities.
This Agreement shall terminate on April 30, 2005 unless the sale of Common
Stock contemplated by the Offering shall have been completed prior to such date.
[Signatory]
By:
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Name:
Title:
EXHIBIT II
