Exhibit 1.1
8,000,000 SHARES
XXXXXXX RIVER LABORATORIES INTERNATIONAL, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
July [ ], 2001
Credit Suisse First Boston Corporation
Xxxxxx Brothers Inc.
XX Xxxxx Securities Corporation
U.S. Bancorp Xxxxx Xxxxxxx Inc.
As Representatives of the Several Underwriters,
c/o Credit Suisse First Boston Corporation,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Dear Sirs:
1. INTRODUCTORY. Xxxxxxx River Laboratories International, Inc., a Delaware
corporation ("COMPANY"), proposes to issue and sell, and certain stockholders of
the Company named in Schedule A hereto ("SELLING STOCKHOLDERS") severally
propose to sell, an aggregate of 8,000,000 shares ("FIRM SECURITIES") of Common
Stock of the Company, par value $0.01 per share ("COMMON STOCK"), of which
2,000,000 shares are to be issued and sold by the Company and 6,000,000 shares
are to be sold by the Selling Stockholders, each Selling Stockholder selling the
amount set forth beside such Selling Stockholder's name in Schedule II hereto.
The Selling Stockholders also propose to sell to the Underwriters, at the option
of the Underwriters, an aggregate of not more than 1,200,000 additional shares
("OPTIONAL SECURITIES") of Common Stock as set forth below. The Firm Securities
and the Optional Securities are herein collectively called the "OFFERED
SECURITIES". The Company and the Selling Stockholders hereby agree with the
several Underwriters named in Schedule B hereto ("UNDERWRITERS") as follows:
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SELLING
STOCKHOLDERS.
(a) The Company represents and warrants to, and agrees with, the
several Underwriters that:
(i) A registration statement (No. 333-63766) relating to the
Offered Securities, including a form of prospectus, has been filed
with the Securities and Exchange Commission ("COMMISSION") and either
(i) has been declared effective under the Securities Act of 1933
("ACT") and is not proposed to be amended or (ii) is proposed to be
amended by amendment or post-effective amendment. If such registration
statement ("INITIAL REGISTRATION STATEMENT") has been declared
effective, either (i) an additional registration statement
("ADDITIONAL REGISTRATION STATEMENT") relating to the Offered
Securities may have been filed with the Commission pursuant to Rule
462(b) ("RULE 462(b)") under the Act and, if so filed, has become
effective upon filing pursuant to such Rule and the Offered Securities
all have been duly registered under the Act pursuant to the initial
registration statement and, if applicable, the additional registration
statement or (ii) such an additional registration statement is
proposed to be filed with the Commission pursuant to Rule 462(b) and
will become effective upon filing pursuant to such Rule and upon such
filing the Offered Securities will all have been duly registered under
the Act pursuant to the initial registration statement and such
additional registration statement. If the Company does not propose to
amend the initial registration statement or if an additional
registration statement has been filed and the Company does not propose
to amend it, and if any post-effective amendment to either such
registration statement has been filed with the Commission prior to the
execution and delivery of this Agreement, the most recent amendment
(if any) to each such registration statement has been declared
effective by the Commission or has become effective upon filing
pursuant to Rule 462(c) ("RULE 462(c)") under the Act or, in the case
of the additional registration statement, Rule 462(b). For purposes of
this Agreement, "EFFECTIVE TIME" with respect to the initial
registration statement or, if filed prior to the execution and
delivery of this Agreement, the additional registration statement
means (i) if the Company has advised the Representatives that it does
not propose to amend such registration statement, the date and time as
of which such registration statement, or the most recent
post-effective amendment thereto (if any) filed prior to the execution
and delivery of this Agreement, was declared effective by the
Commission or has become effective upon filing pursuant to Rule
462(c), or (ii) if the Company has advised the Representatives that it
proposes to file an amendment or post-effective amendment to such
registration statement, the date and time as of which such
registration statement, as amended by such amendment or post-effective
amendment, as the case may be, is declared effective by the
Commission. If an additional registration statement has not been filed
prior to the execution and delivery of this Agreement but the Company
has advised the Representatives that it proposes to file one,
"EFFECTIVE TIME" with respect to such additional registration
statement means the date and time as of which such registration
statement is filed and becomes effective pursuant to Rule 462(b).
"EFFECTIVE DATE" with respect to the initial registration statement or
the additional registration statement (if any) means the date of the
Effective Time thereof. The initial registration statement, as amended
at its Effective Time, including all material incorporated by
reference therein, including all information contained in the
additional registration statement (if any) and deemed to be a part of
the initial registration statement as of the Effective Time of the
additional registration statement pursuant to the General Instructions
of the Form on which it is filed and including all information (if
any) deemed to be a part of the initial registration statement as of
its Effective Time pursuant to Rule 430A(b) ("RULE 430A(b)") under the
Act, is hereinafter referred to as the "INITIAL REGISTRATION
STATEMENT". The additional registration statement, as amended at its
Effective Time, including the contents of the initial registration
statement incorporated by reference therein and including all
information (if any) deemed to be a part of the additional
registration statement as of its Effective Time pursuant to Rule
430A(b), is hereinafter referred to as the "ADDITIONAL REGISTRATION
STATEMENT". The Initial Registration Statement and the Additional
Registration Statement are herein referred to collectively as the
"REGISTRATION STATEMENTS" and individually as a "REGISTRATION
STATEMENT". The form of prospectus relating to the Offered Securities,
as first filed with the Commission pursuant to and in accordance with
Rule 424(b) ("RULE 424(b)") under the Act or (if no such filing is
required) as included in a Registration Statement, including all
material incorporated by reference in such prospectus, is hereinafter
referred to as the "PROSPECTUS". No document has been or will be
prepared or distributed in reliance on Rule 434 under the Act.
(ii) If the Effective Time of the Initial Registration Statement
is prior to the execution and delivery of this Agreement: (i) on the
Effective Date of the Initial Registration Statement, the Initial
Registration Statement conformed in all material respects to the
requirements of the Act and the rules and regulations of the
Commission ("RULES AND REGULATIONS") and did not include any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading, (ii) on the Effective Date of the Additional
Registration Statement (if any), each Registration Statement
conformed, or will conform, in all material respects to the
requirements of the Act and the Rules and Regulations and did not
include, or will not include, any untrue statement of a material fact
and did not omit, or will not omit, to state any material fact
required to be stated therein or necessary to make the statements
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therein not misleading and (iii) on the date of this Agreement, the
Initial Registration Statement and, if the Effective Time of the
Additional Registration Statement is prior to the execution and
delivery of this Agreement, the Additional Registration Statement each
conforms, and at the time of filing of the Prospectus pursuant to Rule
424(b) or (if no such filing is required) at the Effective Date of the
Additional Registration Statement in which the Prospectus is included,
each Registration Statement and the Prospectus will conform, in all
material respects to the requirements of the Act and the Rules and
Regulations, and neither of such documents includes, or will include,
any untrue statement of a material fact or omits, or will omit, to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading. If the Effective Time of
the Initial Registration Statement is subsequent to the execution and
delivery of this Agreement: on the Effective Date of the Initial
Registration Statement, the Initial Registration Statement and the
Prospectus will conform in all material respects to the requirements
of the Act and the Rules and Regulations, neither of such documents
will include any untrue statement of a material fact or will omit to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading, and no Additional
Registration Statement has been or will be filed. The two preceding
sentences do not apply to statements in or omissions from a
Registration Statement or the Prospectus based upon written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood and
agreed that the only such information is that described as such in
Section 7(b) and (c) hereof.
(iii) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware,
with power and authority (corporate and other) to own its properties
and conduct its business as described in the Prospectus; and the
Company is duly qualified to do business as a foreign corporation in
good standing in all other jurisdictions in which its ownership or
lease of property or the conduct of its business requires such
qualification, except where the failure to be so qualified would not
have a material adverse effect on the business, prospects, financial
condition or results of operations of the Company and its
subsidiaries, taken as a whole (each a "MATERIAL ADVERSE EFFECT").
(iv) Each subsidiary of the Company has been duly incorporated
and is an existing corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority (corporate
and other) to own its properties and conduct its business as described
in the Prospectus; and each subsidiary of the Company is duly
qualified to do business as a foreign corporation in good standing in
all other jurisdictions in which its ownership or lease of property or
the conduct of its business requires such qualification, except where
the failure to be so qualified would not have a Material Adverse
Effect; all of the issued and outstanding capital stock of each
subsidiary of the Company has been duly authorized and validly issued
and is fully paid and nonassessable; and, except as disclosed in the
Prospectus, the capital stock of each subsidiary owned by the Company,
directly or through subsidiaries, is owned free from liens,
encumbrances and defects.
(v) The Offered Securities and all other outstanding shares of
capital stock of the Company have been duly authorized; all
outstanding shares of capital stock of the Company are, and, when the
Offered Securities have been delivered and paid for in accordance with
this Agreement on each Closing Date (as defined below), such Offered
Securities will have been, validly issued, fully paid and
nonassessable and will conform in all material respects to the
description thereof contained in the Prospectus; and the stockholders
of the Company have no preemptive rights with respect to the Offered
Securities.
(vi) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or
any Underwriter for a brokerage commission, finder's fee or other like
payment in connection with this offering.
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(vii) Except as described in the Prospectus, there are no
contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Act with respect to any securities of
the Company owned or to be owned by such person or to require the
Company to include such securities in the securities registered
pursuant to a Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Act.
(viii) The Offered Securities have been approved for listing on
The New York Stock Exchange subject to notice of issuance.
(ix) No consent, approval, authorization, or order of, or filing
with, any governmental agency or body or any court is required for the
execution, delivery or performance of this Agreement by the Company or
the issuance and sale of the Offered Securities by the Company, except
such as have been obtained and made under the Act and such as may be
required under state securities laws.
(x) The execution, delivery and performance of this Agreement by
the Company, and the issuance and sale of the Offered Securities will
not result in a breach or violation of any of the terms and provisions
of, or constitute a default under, (i) any statute, any rule,
regulation or order of any governmental agency or body or any court,
domestic or foreign, having jurisdiction over the Company or any
subsidiary of the Company or any of their properties, (ii) any
agreement or instrument to which the Company or any such subsidiary is
a party or by which the Company or any such subsidiary is bound or to
which any of the properties of the Company or any such subsidiary is
subject, or (iii) the charter or by-laws of the Company or any such
subsidiary, except, in the case of (i) and (ii), for such as would not
have a Material Adverse Effect, and the Company has full power and
authority to authorize, issue and sell the Offered Securities as
contemplated by this Agreement.
(xi) This Agreement has been duly authorized, executed and
delivered by the Company.
(xii) Except as disclosed in the Prospectus, the Company and its
subsidiaries have good and marketable title to all real properties and
all other properties and assets owned by them, in each case free from
liens, encumbrances and defects that would materially affect the value
thereof or materially interfere with the use made or to be made
thereof by them; and except as disclosed in the Prospectus, the
Company and its subsidiaries hold any leased real or personal property
under valid and enforceable leases with no exceptions that would
materially interfere with the use made or to be made thereof by them.
(xiii) The Company and its subsidiaries possess adequate
certificates, authorities or permits issued by appropriate
governmental agencies or bodies necessary to conduct the business now
operated by them, except where the failure to have any such
certificate, authority or permit would not have a Material Adverse
Effect, and have not received any notice of proceedings relating to
the revocation or modification of any such certificate, authority or
permit, which would reasonably be expected to result, singly or in the
aggregate, in a Material Adverse Effect.
(xiv) No labor dispute with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent
that might have a Material Adverse Effect.
(xv) Except as disclosed in the Prospectus, the Company and its
subsidiaries own, possess or can acquire on reasonable terms, adequate
trademarks, trade names and other rights to inventions, know-how,
patents, copyrights, confidential information and other intellectual
property (collectively, "INTELLECTUAL PROPERTY RIGHTS") necessary to
conduct the business now operated by
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them, or presently employed by them, except where the failure to own,
possess or otherwise be able to acquire such intellectual property
rights would not, individually or in the aggregate, have a Material
Adverse Effect; and, to the best of the Company's knowledge, neither
the Company nor any of its Subsidiaries has received any notice of
infringement of or conflict with asserted rights of others with
respect to any intellectual property rights that, if determined
adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a Material Adverse Effect.
(xvi) Except as disclosed in the Prospectus, neither the Company
nor any of its subsidiaries is in violation of any statute, any rule,
regulation, decision or order of any governmental agency or body or
any court, domestic or foreign, relating to the use, disposal or
release of hazardous or toxic substances or relating to the protection
or restoration of the environment or human exposure to hazardous or
toxic substances (collectively, "ENVIRONMENTAL LAWS"), owns or
operates any real property contaminated with any substance that is
subject to any environmental laws, is liable for any off-site disposal
or contamination pursuant to any environmental laws, or is subject to
any claim relating to any environmental laws, which violation,
contamination, liability or claim would individually or in the
aggregate have a Material Adverse Effect; and the Company is not aware
of any pending investigation which might lead to such a claim.
(xvii) Except as disclosed in the Prospectus, there are no
pending actions, suits or proceedings against or affecting the
Company, any of its subsidiaries or any of their respective
properties, which would reasonably be expected to result, individually
or in the aggregate, in a Material Adverse Effect, or would materially
and adversely affect the ability of the Company to perform its
obligations under this Agreement, or which are otherwise material in
the context of the sale of the Offered Securities; and no such
actions, suits or proceedings are, to the Company's knowledge,
threatened.
(xviii) The financial statements included in each Registration
Statement and the Prospectus present fairly the financial position of
the Company and its consolidated subsidiaries as of the dates shown
and their results of operations and cash flows for the periods shown,
and, except as otherwise disclosed in the Prospectus, such financial
statements have been prepared in conformity with the generally
accepted accounting principles in the United States applied on a
consistent basis.
(xix) Except as disclosed in the Prospectus, since the date of
the latest audited financial statements included in the Prospectus
there has been no material adverse change, nor any development or
event involving a prospective material adverse change, in the
condition (financial or other), business, properties or results of
operations of the Company and its subsidiaries taken as a whole, and,
except as disclosed in or contemplated by the Prospectus, there has
been no dividend or distribution of any kind declared, paid or made by
the Company on any class of its capital stock.
(xx) The Company is not and, after giving effect to the offering
and sale of the Offered Securities and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment
company" as defined in the Investment Company Act of 1940.
(b) Each Selling Stockholder, severally and not jointly, represents
and warrants to, and agrees with, each of the Underwriters and the Company
that:
(i) Such Selling Stockholder has and on each Closing Date
hereinafter mentioned will have valid title free and clear of all
liens, encumbrances or claims (other than as set forth in the Custody
Agreement that such Selling Stockholder is party to) to the Offered
Securities to be
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delivered by such Selling Stockholder on such Closing Date and full
right, power and authority to enter into this Agreement and to sell,
assign, transfer and deliver the Offered Securities to be delivered by
such Selling Stockholder in accordance with this Agreement on such
Closing Date hereunder; and upon the delivery of and payment for the
Offered Securities on each Closing Date hereunder the several
Underwriters will acquire valid title to the Offered Securities free
and clear of all liens, encumbrances or claims (other than as set
forth in the Custody Agreement that such Selling Stockholder is party
to) to be delivered by such Selling Stockholder on such Closing Date.
(ii) If the Effective Time of the Initial Registration Statement
is prior to the execution and delivery of this Agreement: (A) on the
Effective Date of the Initial Registration Statement, the Initial
Registration Statement did not include any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading,
(B) on the Effective Date of the Additional Registration Statement (if
any), neither Registration Statement included, or will include, any
untrue statement of a material fact and did not omit, or will not
omit, to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and (C) on
the date of this Agreement, the Initial Registration Statement and, if
the Effective Time of the Additional Registration Statement is prior
to the execution and delivery of this Agreement, the Additional
Registration Statement do not, and at the time of filing of the
Prospectus pursuant to Rule 424(b) or (if no such filing is required)
at the Effective Date of the Additional Registration Statement in
which the Prospectus is included, each Registration Statement and the
Prospectus will not include, any untrue statement of a material fact
or omits and will not omit, to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading. In the case of those stockholders who are members of the
Company's management, as noted on Schedule A hereto (each a
"MANAGEMENT SELLING STOCKHOLDER"), the preceding sentence does not
apply to statements in or omissions from a Registration Statement or
the Prospectus based upon written information furnished to the Company
by any Underwriter through the Representatives specifically for use
therein, it being understood and agreed that the only such information
is that described as such in Section 7(d) hereof. In the case of all
other Selling Stockholders, the first sentence of this Section
2(b)(ii) constitutes a representation only to the extent that any
statements in or omissions from a Registration Statement or the
Prospectus are based on written information relating to such Selling
Stockholder furnished to the Company by such Selling Stockholder
specifically for use therein.
(iii) Except as disclosed in the Prospectus and other than this
Agreement, there are no contracts, agreements or understandings
between such Selling Stockholder and any person that would give rise
to a valid claim against such Selling Stockholder or any Underwriter
for a brokerage commission, finder's fee or other like payment in
connection with this offering.
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 and each Selling Stockholder
agree, severally and not jointly, to sell to the Underwriters, and the
Underwriters agree, severally and not jointly, to purchase from the Company and
each Selling Stockholder, at a purchase price of $[ ] per share, that number of
Firm Securities (rounded up or down, as determined by Credit Suisse First Boston
Corporation ("CSFBC") in its discretion, in order to avoid fractions) obtained
by multiplying 2,000,000 Firm Securities, in the case of the Company, and the
number of Firm Securities set forth opposite the name of such Selling
Stockholder in Schedule A hereto, in the case of a Selling Stockholder, in each
case by a fraction the numerator of which is the number of Firm Securities set
forth opposite the name of such Underwriter in Schedule B hereto and the
denominator of which is the total number of Firm Securities.
Certificates in negotiable form for the Offered Securities to be sold by
the Selling Stockholders hereunder have been placed in custody, for delivery
under this Agreement, under Custody Agreements made with Equiserve Trust
Company, N.A., as custodian ("CUSTODIAN"). Each Selling Stockholder agrees that
the arrangements made by the Selling Stockholders for such custody are to that
extent irrevocable, and that the obligations of the Selling Stockholders
hereunder shall not be terminated by operation of law, whether by the death of
any individual Selling Stockholder or the occurrence of any other event, or in
the case of a trust, by the death of any trustee or trustees or
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the termination of such trust, or by the bankruptcy or dissolution of any
Selling Stockholder which is a corporation or other entity. If any individual
Selling Stockholder or any such trustee or trustees should die, or if any other
such event should occur, or if any of such trusts should terminate or
corporation or other entities shall be bankrupt or dissolve, before the delivery
of the Offered Securities hereunder, certificates for such Offered Securities
shall be delivered by the Custodian in accordance with the terms and conditions
of this Agreement as if such death or other event or termination, bankruptcy or
dissolution had not occurred, regardless of whether or not the Custodian shall
have received notice of such death or other event or termination.
The Company and the Custodian will deliver the Firm Securities to the
Representatives for the accounts of the Underwriters, against payment of the
purchase price in Federal (same day) funds by wire transfer to an account at a
bank acceptable to Credit Suisse First Boston Corporation ("CSFBC") drawn to the
order of [ ] at the office of Xxxxxx & Xxxxxxx, at 10:00 A.M., New York time, on
[ , July [ ] ], 2001 or at such other time not later than seven full business
days thereafter as CSFBC and the Company determine, such time being herein
referred to as the "FIRST CLOSING DATE". For purposes of Rule 15c6-1 under the
Securities Exchange Act of 1934, the First Closing Date (if later than the
otherwise applicable settlement date) shall be the settlement date for payment
of funds and delivery of securities for all the Offered Securities sold pursuant
to the offering. The certificates for the Firm Securities so to be delivered
will be in definitive form, in such denominations and registered in such names
as CSFBC requests and will be made available for checking and packaging at the
above office of Xxxxxx & Xxxxxxx at least 24 hours prior to the First Closing
Date.
In addition, upon written notice from CSFBC given to the Company and the
Selling Stockholders from time to time not more than 30 days subsequent to the
date of the Prospectus, the Underwriters may purchase all or less than all of
the Optional Securities at the purchase price per Security to be paid for the
Firm Securities. Each Selling Stockholder agrees, severally and not jointly, to
sell to the Underwriters the respective number of Optional Securities obtained
by multiplying the number of Optional Securities specified in such notice by a
fraction the numerator of which is the number of shares set forth opposite the
name of such Selling Stockholder in Schedule A hereto under the caption "Number
of Optional Securities to be Sold" and the denominator of which is the total
number of Optional Securities (subject to adjustment by CSFBC to eliminate
fractions) and the Underwriters agree, severally and not jointly, to purchase
such Optional Securities. Such Optional Securities shall be purchased from each
Selling Stockholder for the account of each Underwriter in the same proportion
as the number of shares of Firm Securities set forth opposite such Underwriter's
name bears to the total number of shares of Firm Securities (subject to
adjustment by CSFBC to eliminate fractions) and may be purchased by the
Underwriters only for the purpose of covering over-allotments made in connection
with the sale of the Firm Securities. No Optional Securities shall be sold or
delivered unless the Firm Securities previously have been, or simultaneously
are, sold and delivered. The right to purchase the Optional Securities or any
portion thereof may be exercised from time to time and to the extent not
previously exercised may be surrendered and terminated at any time upon notice
by CSFBC to the Company and the Selling Stockholders.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "OPTIONAL CLOSING DATE", which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "CLOSING DATE"), shall be determined by CSFBC
but shall be not later than five full business days after written notice of
election to purchase Optional Securities is given. The Custodian will deliver
the Optional Securities being purchased on each Optional Closing Date to the
Representatives for the accounts of the several Underwriters, against payment of
the purchase price therefor in Federal (same day) funds by official bank check
or checks or wire transfer to an account at a bank acceptable to CSFBC drawn to
the order of CSFBC, at the above office of Xxxxxx & Xxxxxxx. The certificates
for the Optional Securities being purchased on each Optional Closing Date will
be in definitive form, in such denominations and registered in such names as
CSFBC requests upon reasonable notice prior to such Optional Closing Date and
will be made available for checking and packaging at the above office of Xxxxxx
& Xxxxxxx at a reasonable time in advance of such Optional Closing Date.
4. OFFERING BY UNDERWRITERS. It is understood that the several Underwriters
propose to offer the Offered Securities for sale to the public as set forth in
the Prospectus.
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5. CERTAIN AGREEMENTS OF THE COMPANY AND THE SELLING STOCKHOLDERS.
(a) The Company agrees with the several Underwriters and the Selling
Stockholders that:
(i) If the Effective Time of the Initial Registration Statement
is prior to the execution and delivery of this Agreement, the Company
will file the Prospectus with the Commission pursuant to and in
accordance with subparagraph (1) (or, if applicable and if consented
to by CSFBC, subparagraph (4)) of Rule 424(b) not later than the
earlier of (A) the second business day following the execution and
delivery of this Agreement or (B) the fifteenth business day after the
Effective Date of the Initial Registration Statement.
The Company will advise CSFBC promptly of any such filing
pursuant to Rule 424(b). If the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement and an additional registration statement is necessary to
register a portion of the Offered Securities under the Act but the
Effective Time thereof has not occurred as of such execution and
delivery, the Company will file the additional registration statement
or, if filed, will file a post-effective amendment thereto with the
Commission pursuant to and in accordance with Rule 462(b) on or prior
to 10:00 P.M., New York time, on the date of this Agreement or, if
earlier, on or prior to the time the Prospectus is printed and
distributed to any Underwriter, or will make such filing at such later
date as shall have been consented to by CSFBC.
(ii) The Company will advise CSFBC promptly of any proposal to
amend or supplement (excluding for purposes of this Section 5(a)(ii)
any filing made pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934) the initial or any additional
registration statement as filed or the related prospectus or the
Initial Registration Statement, the Additional Registration Statement
(if any) or the Prospectus and will not effect such amendment or
supplementation without CSFBC's consent; and the Company will also
advise CSFBC promptly of the effectiveness of each Registration
Statement (if its Effective Time is subsequent to the execution and
delivery of this Agreement) and of any amendment or supplementation of
a Registration Statement or the Prospectus and of the institution by
the Commission of any stop order proceedings in respect of a
Registration Statement and will use its best efforts to prevent the
issuance of any such stop order and to obtain as soon as possible its
lifting, if issued.
(iii) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection
with sales by any Underwriter or dealer, any event occurs as a result
of which the Prospectus as then amended or supplemented would include
an untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus to comply with the Act,
the Company will promptly notify CSFBC of such event and will promptly
prepare and file with the Commission, at its own expense, an amendment
or supplement which will correct such statement or omission or an
amendment which will effect such compliance. Neither CSFBC's consent
to, nor the Underwriters' delivery of, any such amendment or
supplement shall constitute a waiver of any of the conditions set
forth in Section 6.
(iv) As soon as practicable, but not later than the Availability
Date (as defined below), the Company will make generally available to
its securityholders an earnings statement covering a period of at
least 12 months beginning after the Effective Date of the Initial
Registration Statement (or, if later, the Effective Date of the
Additional Registration Statement) which will satisfy the provisions
of Section 11(a) of the Act. For the purpose of the preceding
sentence, "AVAILABILITY DATE" means the 45th day after the end of the
fourth fiscal quarter following the fiscal quarter that includes such
Effective Date, except that, if such fourth fiscal quarter is the last
quarter of the Company's fiscal year, "AVAILABILITY DATE" means the
90th day after the end of such fourth fiscal quarter.
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(v) The Company will furnish to the Representatives copies of
each Registration Statement (six of which will include all exhibits),
each related preliminary prospectus, and, so long as a prospectus
relating to the Offered Securities is required to be delivered under
the Act in connection with sales by any Underwriter or dealer, the
Prospectus and all amendments and supplements to such documents, in
each case in such quantities as CSFBC requests. The Prospectus shall
be so furnished on or prior to 3:00 P.M., New York time, on the
business day following the later of the execution and delivery of this
Agreement or the Effective Time of the Initial Registration Statement.
All other documents shall be so furnished as soon as available. The
Company will pay the expenses of printing and distributing to the
Underwriters all such documents.
(vi) The Company will cooperate with you and counsel for the
Underwriters in connection with the registration or qualification of
the Offered Securities for offer and sale by the several Underwriters
and by dealers under the state securities or Blue Sky laws of such
U.S. jurisdictions as CSFBC designates and will continue such
qualifications in effect so long as required for the distribution;
PROVIDED, HOWEVER, that the Company shall not be required in
connection therewith to qualify as a foreign corporation in any
jurisdiction in which it is not now so qualified or to take any action
that would subject it to general consent to service of process or
taxation in any jurisdiction in which it is not now so subject.
(vii) The Company will pay all expenses incident to the
performance of its obligations under this Agreement, for any expenses
in connection with the registration or qualification of the Offered
Securities for offer and sale under the securities or Blue Sky laws of
the several states and all costs of printing or producing memoranda
relating thereto (including the filing fees and reasonable fees and
disbursements of counsel for the Underwriters in connection with such
registration or qualification and memoranda relating thereto not to
exceed $5,000), for the filing fee incident to the review by the
National Association of Securities Dealers, Inc. of the Offered
Securities, for any travel expenses of the Company's officers and
employees and any other expenses of the Company in connection with
attending or hosting meetings with prospective purchasers of the
Offered Securities and for expenses incurred in distributing
preliminary prospectuses and the Prospectus (including any amendments
and supplements thereto) to the Underwriters.
(viii) For a period of 90 days after the date of the Prospectus,
the Company will not offer, sell, contract to sell or otherwise
dispose of, directly or indirectly, or file with the Commission a
registration statement under the Act relating to, any additional
shares of its Common Stock or securities convertible into or
exchangeable or exercisable for any shares of its Common Stock, or
publicly disclose the intention to make any such offer, sale or
disposition or filing, without the prior written consent of CSFBC,
except during this period the Company may grant stock awards under the
1999 management incentive plan, 2000 incentive plan and 2000 directors
stock plan and it may also issue shares of Common Stock upon the
exercise of an option or warrant or the conversion of a security
outstanding on the date hereof and in connection with acquisitions.
(b) Each Selling Stockholder (i) agrees to deliver to the Custodian on
or prior to the First Closing Date a properly completed and executed United
States Treasury Department Form W-9 (or other applicable form or statement
specified by Treasury Department regulations in lieu thereof).
(ii) For a period of 90 days after the date of the Prospectus,
each Selling Stockholder will not offer, sell, contract to sell or
otherwise dispose of any shares of Common Stock or securities
convertible into or exchangeable or exercisable for any shares of its
Common Stock, or publicly disclose the intention to make any such
offer, sale or disposition, without the prior written consent of
CSFBC, except that the foregoing provision shall not apply (A) to the
sale or other
9
transfer of shares of Common Stock by a Selling Stockholder to any
associate (as such term is defined in Rule 12b-2 of the Securities
Exchange Act of 1934), PROVIDED that, such associate executes a
lock-up agreement in the form attached as Exhibit A hereto prior to
such transfer; (B) to the sale or other transfer of any of the
10,000 warrants to purchase Common Stock held by The 1818 Mezzanine
Fund, L.P.; or (C) to the sale or other transfer of any of the 14,200
warrants to purchase Common Stock held by TCW Leveraged Income Trust
L.P., TCW Leveraged Income Trust II, L.P., TCW/Crescent Mezzanine
Partners II, L.P., TCW/Crescent Mezzanine Trust II and Crescent
Mach I Partners, L.P., collectively; PROVIDED, FURTHER, that this
Section 5(b)(ii) shall terminate and be of no further force and
effect in the event that the first Closing Date does not occur by
September 1, 2001.
(iii) Each Selling Stockholder will pay all transfer taxes on the
sale by such Selling Stockholder of the Offered Securities to the
Underwriters.
6. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The obligations of
the several Underwriters to purchase and pay for the Firm Securities on the
First Closing Date and the Optional Securities to be purchased on each Optional
Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company and the Selling Stockholders herein, to
the accuracy of the statements of Company officers made pursuant to the
provisions hereof, to the performance by the Company and the Selling
Stockholders of their obligations hereunder and to the following additional
conditions precedent:
(a) The Representatives shall have received a letter, dated the date
of delivery thereof (which, if the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement, shall be on or prior to the date of this Agreement or, if the
Effective Time of the Initial Registration Statement is subsequent to the
execution and delivery of this Agreement, shall be prior to the filing of
the amendment or post-effective amendment to the registration statement to
be filed shortly prior to such Effective Time), of PricewaterhouseCoopers
LLP confirming that they are independent public accountants within the
meaning of the Act and the applicable published Rules and Regulations
thereunder and stating to the effect that:
(i) in their opinion the financial statements and schedules and
summary of earnings examined by them and included in the Registration
Statements comply as to form in all material respects with the
applicable accounting requirements of the Act and the related
published Rules and Regulations;
(ii) on the basis of a reading of the latest available interim
financial statements of the Company, inquiries of officials of the
Company who have responsibility for financial and accounting matters
and other specified procedures, nothing came to their attention that
caused them to believe that:
(A) at the date of the latest available balance sheet read
by such accountants, or at a subsequent specified date not more
than three business days prior to the date of this Agreement,
there was any change in the capital stock or any increase in
short-term indebtedness or long-term debt of the Company and its
consolidated subsidiaries or, at the date of the latest available
balance sheet read by such accountants, there was any decrease in
consolidated net current assets or net assets, as compared with
amounts shown on the latest balance sheet included in the
Prospectus; or
(B) for the period from the closing date of the latest
income statement included in the Prospectus to the closing date
of the latest available income statement read by such accountants
there were any decreases, as compared with the corresponding
period of the previous year and with the period of corresponding
length ended the date of the latest income statement included in
the Prospectus, in total net sales, operating income, net income
(loss) or earnings per common share before extraordinary items.
10
except in all cases set forth in clauses (A) and (B) above for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(iii) they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information
contained in the Registration Statements (in each case to the extent
that such dollar amounts, percentages and other financial information
are derived from the general accounting records of the Company and its
subsidiaries subject to the internal controls of the Company's
accounting system or are derived directly from such records by
analysis or computation) with the results obtained from inquiries, a
reading of such general accounting records and other procedures
specified in such letter and have found such dollar amounts,
percentages and other financial information to be in agreement with
such results, except as otherwise specified in such letter.
For purposes of this subsection, (i) if the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of this
Agreement, "REGISTRATION STATEMENTS" shall mean the initial registration
statement as proposed to be amended by the amendment or post-effective amendment
to be filed shortly prior to its Effective Time, (ii) if the Effective Time of
the Initial Registration Statement is prior to the execution and delivery of
this Agreement but the Effective Time of the Additional Registration is
subsequent to such execution and delivery, "REGISTRATION STATEMENTS" shall mean
the Initial Registration Statement and the additional registration statement as
proposed to be filed or as proposed to be amended by the post-effective
amendment to be filed shortly prior to its Effective Time, and (iii)
"PROSPECTUS" shall mean the prospectus included in the Registration Statements.
All financial statements and schedules included in material incorporated by
reference into the Prospectus shall be deemed included in the Registration
Statements for purposes of this subsection.
(b) If the Effective Time of the Initial Registration Statement is not
prior to the execution and delivery of this Agreement, such Effective Time
shall have occurred not later than 10:00 P.M., New York time, on the date
of this Agreement or such later date as shall have been consented to by
CSFBC. If the Effective Time of the Additional Registration Statement (if
any) is not prior to the execution and delivery of this Agreement, such
Effective Time shall have occurred not later than 10:00 P.M., New York
time, on the date of this Agreement or, if earlier, the time the Prospectus
is printed and distributed to any Underwriter, or shall have occurred at
such later date as shall have been consented to by CSFBC. If the Effective
Time of the Initial Registration Statement is prior to the execution and
delivery of this Agreement, the Prospectus shall have been filed with the
Commission in accordance with the Rules and Regulations and Section 5(a) of
this Agreement. Prior to such Closing Date, no stop order suspending the
effectiveness of a Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or, to the
knowledge of any Selling Stockholder, the Company or the Representatives,
shall be contemplated by the Commission.
(c) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred (i) any change, or any development or event
involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries taken as one enterprise which, in the judgment of a majority
in interest of the Underwriters including the Representatives, is material
and adverse and makes it impractical or inadvisable to proceed with
completion of the public offering or the sale of and payment for the
Offered Securities; (ii) any downgrading in the rating of any debt
securities of the Company by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act), or
any public announcement that any such organization has under surveillance
or review its rating of any debt securities of the Company (other than an
announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating); (iii) any material
suspension or material limitation of trading in securities generally on the
New York Stock Exchange or any setting of minimum prices for trading on
such exchange, or any suspension of trading of any securities of the
Company on any exchange or in the over-the-counter market; (iv) any banking
moratorium declared by U.S. Federal or New York authorities; or (v) any
outbreak or escalation of major hostilities in which the United States is
involved, any declaration of war by Congress
11
or any other substantial national or international calamity or emergency
if, in the judgment of a majority in interest of the Underwriters including
the Representatives, the effect of any such outbreak, escalation,
declaration, calamity or emergency makes it impractical or inadvisable to
proceed with completion of the public offering or the sale of and payment
for the Offered Securities.
(d) The Representatives shall have received an opinion, dated such
Closing Date, of Xxxxx Xxxx & Xxxxxxxx, counsel for the Company, to the
effect that:
(i) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware,
with corporate power and authority to own its properties and conduct
its business as described in the Prospectus; and the Operating Company
is duly qualified and is in good standing as a foreign corporation
authorized to do business in each jurisdiction listed on Exhibit A of
such opinion, except where the failure to be so qualified or in good
standing would not have a Material Adverse Effect;
(ii) The Offered Securities delivered on such Closing Date and
all other outstanding shares of the Common Stock of the Company on
such Closing Date have been duly authorized and validly issued, are
fully paid and nonassessable and conform in all material respects to
the description thereof contained in the Prospectus; and the
stockholders of the Company have no statutory preemptive rights with
respect to the Offered Securities;
(iii) Except as described in the Prospectus, there are no
contracts, agreements or understandings known to such counsel between
the Company and any person granting such person the right to require
the Company to file a registration statement under the Act with
respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the
securities registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration
statement filed by the Company under the Act;
(iv) The Company is not and, after giving effect to the offering
and sale of the Offered Securities and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment
company" as defined in the Investment Company Act of 1940;
(v) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required for the
execution, delivery and performance of this Agreement by the Company
or the issuance or sale of the Offered Securities by the Company,
except such as have been obtained and made under the Act and such as
may be required under state securities laws;
(vi) The execution, delivery and performance of this Agreement
and the issuance and sale of the Offered Securities will not result in
a breach or violation of any of the terms and provisions of, or
constitute a default under, (i) any statute, any rule, regulation or
order of any governmental agency or body or any court having
jurisdiction over the Company or any domestic subsidiary of the
Company or any of their properties, (ii) any agreement or instrument
that is filed as an exhibit to the Registration Statement to which the
Company or any such subsidiary is a party or by which the Company or
any such subsidiary is bound or to which any of the properties of the
Company or any such subsidiary is subject, or (iii) the charter or
by-laws of the Company or any such subsidiary, except, in the case of
(i) and (ii), for such as would not have a Material Adverse Effect,
and the Company has full power and authority to authorize, issue and
sell the Offered Securities as contemplated by this Agreement;
(vii) Based solely upon the oral advice of the staff of the
Commission, the Initial Registration Statement was declared effective
under the Act as of the date and time specified in
12
such opinion, the Additional Registration Statement (if any) was filed
and, assuming compliance with paragraph (b)(2) of Rule 462, became
effective under the Act as of the date and time (if determinable)
specified in such opinion, the Prospectus either was filed with the
Commission pursuant to the subparagraph of Rule 424(b) specified in
such opinion on the date specified therein or was included in the
Initial Registration Statement or the Additional Registration
Statement (as the case may be), and, to the best of the knowledge of
such counsel, no stop order suspending the effectiveness of a
Registration Statement or any part thereof has been issued and no
proceedings for that purpose have been instituted or are pending or
contemplated under the Act;
(viii) This Agreement has been duly authorized, executed and
delivered by the Company.
(ix) The statements relating to legal matters and documents
referred to in the Prospectus under the captions "Description of
Capital Stock" and "Underwriting" fairly present in all material
respects the information called for with respect to such legal matters
or documents.
Such counsel shall also state that while they have not themselves
checked the accuracy, completeness or fairness of, or otherwise
verified, the information furnished with respect to other matters in
the Registration Statement or the Prospectus, they have generally
reviewed and discussed with your representatives and counsel, and with
certain officers and employees of, and independent public accountants
for, the Company, the information furnished, whether or not subject to
such counsel's check and verification and that on the basis of such
consideration, review and discussion, but without independent check or
verification, except as stated above, nothing has come to their
attention to cause them to believe that (i) the Registration Statement
or the Prospectus (except for the financial statements and financial
schedules and other financial and statistical data derived therefrom
included therein, as to which they express no belief) do not comply
as to form in all material respects with the requirements of the Act
and the applicable rules and regulations of the Commission
thereunder, (ii) the Registration Statement or the prospectus
included therein (except for the financial statements and financial
schedules and other financial and statistical data derived therefrom
included therein, as to which they express no belief) at the time the
Registration Statement became effective 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 (iii) the Prospectus (except as stated) as of its date
or as of the date hereof contained or contains an untrue statement
of a material fact or omitted or omits 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; and
(e) The Representatives shall have received an opinion, dated such
Closing Date, of Xxxxx Xxxx & Xxxxxxxx or other, counsel for the Selling
Stockholders, contemplated in the Power of Attorney executed and delivered
by each Selling Stockholder, to the effect that:
(i) A Power of Attorney and Custody Agreement have been duly
authorized, executed and delivered by such Selling Stockholder and
constitute valid and legally binding obligations of such Selling
Stockholder enforceable in accordance with their terms, subject to the
effects of applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally and equitable principles of
general applicability and except as rights to indemnity and
contribution thereunder may be limited by applicable law and except
that no opinion need be expressed with respect to the provisions
contained in the second and third sentence of Section 2 of the Power
of Attorney or the second and third sentences of the sixth paragraph
of the Custody Agreement;
(ii) This Agreement has been duly authorized, executed and
delivered by each such Selling Stockholder and the sale of the Offered
Securities being delivered by such Selling Stockholder at such time of
delivery and the compliance by such Selling Stockholder with all of
the provisions of this Agreement, the Power of Attorney and the
Custody Agreement with respect
13
to such Offered Securities will not result in any violation of the
provisions of the Certificate of Incorporation or By-laws of such
Selling Stockholder if such Selling Stockholder is a corporation or
the Partnership Agreement of such Selling Stockholder if such Selling
Stockholder is a partnership;
(iii) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required for the
execution, delivery and performance of this Agreement by the Selling
Stockholder or the sale of the Offered Securities sold by such Selling
Stockholders, except such as have been obtained and made under the Act
or the Securities Exchange Act of 1934, as amended, and such as may be
required under state securities laws;
(iv) Upon payment for the Offered Securities as provided in this
Agreement and delivery of such Offered Securities to each of the
several Underwriters endorsed to them in blank in the State of New
York, and assuming that such Underwriters are without notice of any
adverse claim, the Underwriters are "protected purchasers" of such
Offered Securities (within the meaning of Section 8-303 of the New
York Uniform Commercial Code (the "UCC")) and the Underwriters will
take such Offered Securities free of any adverse claim to the extent
Section 8-303 of the UCC is effective with respect to such adverse
claim.
In rendering the opinion in paragraph (iv), such counsel may rely upon a
certificate of such Selling Stockholder in respect of matters of fact as to
ownership of, and liens, encumbrances, equities or claims on, the Offered
Securities sold by such Selling Stockholder.
(f) The Representatives shall have received from Xxxxxx & Xxxxxxx,
counsel for the Underwriters, such opinion or opinions, dated such Closing
Date, with respect to the incorporation of the Company, the validity of the
Offered Securities delivered on such Closing Date, the Registration
Statements, the Prospectus and other related matters as the Representatives
may require, and the Selling Stockholders and the Company shall have
furnished to such counsel such documents as they request for the purpose of
enabling them to pass upon such matters.
(g) The Representatives shall have received a certificate, dated such
Closing Date, of the President or any Vice President and a principal
financial or accounting officer of the Company in which such officers, to
the best of their knowledge after reasonable investigation, shall state
that: the representations and warranties of the Company in this Agreement
are true and correct; the Company has complied with all material agreements
and satisfied all conditions on its part to be performed or satisfied
hereunder at or prior to such Closing Date; no stop order suspending the
effectiveness of any Registration Statement has been issued and no
proceedings for that purpose have been instituted or are contemplated by
the Commission; the Additional Registration Statement (if any) satisfying
the requirements of subparagraphs (1) and (3) of Rule 462(b) was filed
pursuant to Rule 462(b), including payment of the applicable filing fee in
accordance with Rule 111(a) or (b) under the Act, prior to the time the
Prospectus was printed and distributed to any Underwriter; and, subsequent
to the date of the most recent financial statements in the Prospectus,
there has been no material adverse change, nor any development or event
involving a prospective material adverse change, in the condition
(financial or other), business, properties or results of operations of the
Company and its subsidiaries taken as a whole except as set forth in or
contemplated by the Prospectus or as described in such certificate.
(h) The Representatives shall have received a letter, dated such
Closing Date, of which meets the requirements of subsection (a) of this
Section, except that the specified date referred to in such subsection will
be a date not more than three days prior to such Closing Date for the
purposes of this subsection.
14
(i) On or prior to the date of this Agreement, the Representatives
shall have received lockup letters from each of the executive officers and
directors of the Company who are not a party to this Agreement and each
stockholder listed on Schedule C hereto.
The Company will furnish the Representatives with such conformed copies of
such opinions, certificates, letters and documents as the Representatives
reasonably request. CSFBC may in its sole discretion waive on behalf of the
Underwriters compliance with any conditions to the obligations of the
Underwriters hereunder, whether in respect of an Optional Closing Date or
otherwise.
7. INDEMNIFICATION AND CONTRIBUTION. (a) The Company will indemnify and
hold harmless each Underwriter, its partners, directors and officers and each
person, if any, who controls such Underwriter within the meaning of Section 15
of the Act, against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any Registration Statement,
the Prospectus, or any amendment or supplement thereto, or any related
preliminary prospectus, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and will reimburse
each Underwriter for any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating or defending any such loss, claim,
damage, liability or action as such expenses are incurred; PROVIDED, HOWEVER,
that the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement in or omission or alleged omission from
any of such documents in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood and agreed
that the only such information furnished by any Underwriter consists of the
information described as such in subsection (d) below.
Insofar as the foregoing indemnity agreement, or the representations and
warranties contained in Section 2(b), may permit indemnification for liabilities
under the Act of any person who is an Underwriter or a partner or controlling
person of an Underwriter within the meaning of Section 15 of the Act and who, at
the date of this Agreement, is a director, officer or controlling person of the
Company, the Company has been advised that in the opinion of the Commission such
provisions may contravene Federal public policy as expressed in the Act and may
therefore be unenforceable. In the event that a claim for indemnification under
such agreement or such representations and warranties for any such liabilities
(except insofar as such agreement provides for the payment by the Company of
expenses incurred or paid by a director, officer or controlling person in the
successful defense of any action, suit or proceeding) is asserted by such a
person, the Company will submit to a court of appropriate jurisdiction (unless
in the opinion of counsel for the Company the matter has already been settled by
controlling precedent) the question of whether or not indemnification by it for
such liabilities is against public policy as expressed in the Act and therefore
unenforceable, and the Company will be governed by the final adjudication of
such issue.
(b) Each Management Selling Stockholder will indemnify and hold
harmless the Company and each Underwriter, its partners, directors and
officers and each person, if any, who controls such Underwriter within the
meaning of Section 15 of the Act, against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter or the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in any Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any related preliminary prospectus, or
arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse each Underwriter
and the Company for any legal or other expenses reasonably incurred by such
Underwriter or the Company in connection with investigating or defending
any such loss, claim, damage, liability or action as such expenses are
incurred; PROVIDED, HOWEVER, that each Management Selling Stockholder will
not be liable in any such case to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement in or omission or alleged omission from any of
such
15
documents in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through the Representatives
specifically for use therein, it being understood and agreed that the only
such information furnished by any Underwriter consists of the information
described as such in subsection (d) below; PROVIDED, FURTHER, that with
respect to any untrue statement or alleged untrue statement in or omission
or alleged omission from any preliminary prospectus the indemnity agreement
contained in this subsection (b) shall not inure to the benefit of any
Underwriter from whom the person asserting any such losses, claims, damages
or liabilities purchased the Offered Securities concerned, to the extent
that a prospectus relating to such Offered Securities was required to be
delivered by such Underwriter under the Act in connection with such
purchase and any such loss, claim, damage or liability of such Underwriter
results from the fact that there was not sent or given to such person, at
or prior to the written confirmation of the sale of such Offered Securities
to such person, a copy of the Prospectus (exclusive of material
incorporated by reference) if the Company had previously furnished copies
thereof to such Underwriter; PROVIDED, FURTHER, that the liability under
this subsection of each Management Selling Stockholder shall be limited to
an amount equal to the aggregate net proceeds (before expenses) to such
Management Selling Stockholder from the sale of Offered Securities sold by
such Management Selling Stockholder hereunder.
(c) Each Selling Stockholder who is not a Management Selling
Stockholder, severally and not jointly, will indemnify and hold harmless
the Company and each Underwriter, its partners, directors and officers and
each person, if any, who controls such Underwriter within the meaning of
Section 15 of the Act, against any losses, claims, damages or liabilities,
joint or several, to which such Underwriter or the Company may become
subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in any Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any related preliminary prospectus, or
arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading; and will reimburse each Underwriter
and the Company for any legal or other expenses reasonably incurred by such
Underwriter or the Company in connection with investigating or defending
any such loss, claim, damage, liability or action as such expenses are
incurred; PROVIDED, HOWEVER, that each such Selling Stockholder shall only
be subject to such liability to the extent that the untrue statement or
alleged untrue statement or omission or alleged omission is based upon
information provided by such Selling Stockholder or contained in a
representation or warranty given by such Selling Stockholder in this
Agreement or Custody Agreement; PROVIDED, FURTHER, that each such Selling
Stockholder will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement in or omission or alleged omission
from any of such documents in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood and
agreed that the only such information furnished by any Underwriter consists
of the information described as such in subsection (d) below; PROVIDED,
FURTHER, that with respect to any untrue statement or alleged untrue
statement in or omission or alleged omission from any preliminary
prospectus the indemnity agreement contained in this subsection (c) shall
not inure to the benefit of any Underwriter from whom the person asserting
any such losses, claims, damages or liabilities purchased the Offered
Securities concerned, to the extent that a prospectus relating to such
Offered Securities was required to be delivered by such Underwriter under
the Act in connection with such purchase and any such loss, claim, damage
or liability of such Underwriter results from the fact that there was not
sent or given to such person, at or prior to the written confirmation of
the sale of such Offered Securities to such person, a copy of the
Prospectus (exclusive of material incorporated by reference) if the Company
had previously furnished copies thereof to such Underwriter; and PROVIDED,
FURTHER, that the liability under this subsection of each Selling
Stockholder shall be limited to an amount equal to the aggregate net
proceeds (before expenses) to such Selling Stockholder from the sale of
Offered Securities sold by such Selling Stockholder hereunder.
(d) Each Underwriter will severally and not jointly indemnify and hold
harmless the Company, its directors and officers and each person, if any
who controls the Company within the meaning of Section 15 of the Act, and
each Selling Stockholder against any losses, claims, damages or liabilities
to which the Company or such Selling Stockholder may become subject, under
the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained in any Registration Statement, the Prospectus, or any amendment
or supplement thereto, or any related preliminary prospectus, or arise out
of or are based upon the omission or the alleged omission to state
16
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only
to the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in conformity
with written information furnished to the Company by such Underwriter
through the Representatives specifically for use therein, and will
reimburse any legal or other expenses reasonably incurred by the Company
and each Selling Stockholder in connection with investigating or defending
any such loss, claim, damage, liability or action as such expenses are
incurred, it being understood and agreed that the only such information
furnished by any Underwriter consists of the following information in the
Prospectus furnished on behalf of each Underwriter: the concession and
reallowance figures appearing in the fourth paragraph under the caption
"Underwriting" and the information contained in paragraphs 10, 11, 12 and
13 under the caption "Underwriting."
(e) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party
under subsection (a), (b), (c) or (d) above, notify the indemnifying party
of the commencement thereof; but the omission so to notify the indemnifying
party will not relieve it from any liability which it may have to any
indemnified party otherwise than under subsection (a), (b), (c) or (d)
above or Section 8. In case any such action is brought against any
indemnified party and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof,
with counsel satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the indemnifying
party), and after notice from the indemnifying party to such indemnified
party of its election so to assume the defense thereof, the indemnifying
party will not be liable to such indemnified party under this Section or
Section 8, as the case may be, for any legal or other expenses subsequently
incurred by such indemnified party in connection with the defense thereof
other than reasonable costs of investigation. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have
been sought hereunder by such indemnified party unless such settlement (i)
includes an unconditional release of such indemnified party from all
liability on any claims that are the subject matter of such action and (ii)
does not include a statement as to, or an admission of, fault, culpability
or a failure to act by or on behalf of an indemnified party.
(f) If the indemnification provided for in this Section is unavailable
or insufficient to hold harmless an indemnified party under subsection (a),
(b), (c) or (d) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of the losses, claims, damages or liabilities
(or actions in respect thereof) (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company or such indemnifying
Stockholder on the one hand and the Underwriters on the other from the
offering of the Securities of (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company and the Selling
Stockholders on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Company and the
Selling Stockholders on the one hand and the Underwriters on the other
shall be deemed to be in the same proportion as the total net proceeds from
the offering (before deducting expenses) received by the Company and the
Selling Stockholders bear to the total underwriting discounts and
commissions received by the Underwriters. The relative fault shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company, the Selling Stockholders or the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The amount paid by an
indemnified party as a result of the losses, claims, damages or liabilities
referred to in the first sentence of this subsection (f) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any action or claim
which is the subject of this subsection (f). Notwithstanding the provisions
of this subsection (f), no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the
Securities underwritten by it and distributed to the public were offered to
the public exceeds the amount of any
17
damages which such Underwriter has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations in this subsection (f) to contribute are several in proportion
to their respective underwriting obligations and not joint.
(g) The obligations of the Company and the Selling Stockholders under
this Section shall be in addition to any liability which the Company and
the Selling Stockholders may otherwise have and shall extend, upon the same
terms and conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act; and the obligations of the Underwriters
under this Section shall be in addition to any liability which the
respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each director of the Company, to each officer of
the Company who has signed a Registration Statement and to each person, if
any, who controls the Company within the meaning of the Act.
8. DEFAULT OF UNDERWRITERS. If any Underwriter or Underwriters default in
their obligations to purchase Offered Securities hereunder on either the First
or any Optional Closing Date and the aggregate number of shares of Offered
Securities that such defaulting Underwriter or Underwriters agreed but failed to
purchase does not exceed 10% of the total number of shares of Offered Securities
that the Underwriters are obligated to purchase on such Closing Date, CSFBC may
make arrangements satisfactory to the Company and the Selling Stockholders for
the purchase of such Offered Securities by other persons, including any of the
Underwriters, but if no such arrangements are made by such Closing Date, the
non-defaulting Underwriters shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Offered Securities that such
defaulting Underwriters agreed but failed to purchase on such Closing Date. If
any Underwriter or Underwriters so default and the aggregate number of shares of
Offered Securities with respect to which such default or defaults occur exceeds
10% of the total number of shares of Offered Securities that the Underwriters
are obligated to purchase on such Closing Date and arrangements satisfactory to
CSFBC and the Company and the Selling Stockholders for the purchase of such
Offered Securities by other persons are not made within 36 hours after such
default, this Agreement will terminate without liability on the part of any
non-defaulting Underwriter, the Company or the Selling Stockholders, except as
provided in Section 8 (PROVIDED that if such default occurs with respect to
Optional Securities after the First Closing Date, this Agreement will not
terminate as to the Firm Securities or any Optional Securities purchased prior
to such termination). As used in this Agreement, the term "Underwriter" includes
any person substituted for an Underwriter under this Section. Nothing herein
will relieve a defaulting Underwriter from liability for its default.
9. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The respective
indemnities, agreements, representations, warranties and other statements of the
Selling Stockholders, of the Company or its officers and of the several
Underwriters set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation, or statement as to the
results thereof, made by or on behalf of any Underwriter, any Selling
Stockholders, the Company or any of their respective representatives, officers
or directors or any controlling person, and will survive delivery of and payment
for the Offered Securities. If this Agreement is terminated pursuant to Section
8 or if for any reason the purchase of the Offered Securities by the
Underwriters is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 5 and the respective
obligations of the Company, the Selling Stockholders and the Underwriters
pursuant to Section 7 shall remain in effect, and if any Offered Securities have
been purchased hereunder the representations and warranties in Section 2 and all
obligations under Section 5 shall also remain in effect. If the purchase of the
Offered Securities by the Underwriters is not consummated for any reason other
than solely because of the termination of this Agreement pursuant to Section 8
or the occurrence of any event specified in clause (iii), (iv) or (v) of Section
6(c), the Company will reimburse the Underwriters for all out-of-pocket expenses
(including fees and disbursements of counsel) reasonably incurred by them in
connection with the offering of the Offered Securities.
10. NOTICES. All communications hereunder will be in writing and, if sent
to the Underwriters, will be mailed, delivered or telegraphed and confirmed to
the Representatives, c/o Credit Suisse First Boston Corporation, Eleven Madison
Avenue, New York, N.Y. 10010-3629, Attention: Transactions Advisory Group, or,
if sent to the Company, will be mailed, delivered or telegraphed and confirmed
to it at 000 Xxxxxxxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000,
18
Attention: Xxxxxx Xxxxxxxxxxx, or, if sent to the Selling Stockholders or any of
them, will be mailed, delivered or telegraphed and confirmed to such Selling
Stockholder at the address of such Selling Stockholder set forth on Schedule A
hereto; PROVIDED, HOWEVER, that any notice to an Underwriter pursuant to Section
7 will be mailed, delivered or telegraphed and confirmed to such Underwriter.
11. SUCCESSORS. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers and
directors and controlling persons referred to in Sections 7 and 9, and no other
person will have any right or obligation hereunder.
12. REPRESENTATION. The Representatives will act for the several
Underwriters in connection with this financing, and any action under this
Agreement taken by the Representatives jointly or by CSFBC will be binding upon
all the Underwriters.
13. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS.
The Company hereby submits to the non-exclusive jurisdiction of the Federal
and state courts in the Borough of Manhattan in The City of New York in any suit
or proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby.
19
If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement among the Selling
Stockholders, the Company and the several Underwriters in accordance with its
terms.
Very truly yours,
DLJ MERCHANT BANKING PARTNERS II, L.P.
DLJ MERCHANT BANKING PARTNERS II-A, L.P.
DLJ OFFSHORE PARTNERS II, C.V.
DLJ DIVERSIFIED PARTNERS L.P.
DLJ DIVERSIFIED PARTNERS-A, L.P.
DLJMB FUNDING II, INC.
DLJ MILLENNIUM PARTNERS, L.P.
DLJ MILLENNIUM PARTNERS, A-L.P.
DLJ EAB PARTNERS, L.P.
DLJ INVESTMENT PARTNERS, L.P.
DLJ INVESTMENT FUNDING, INC.
DLJ FIRST ESC L.P.
DLJ ESC II, L.P.
DLJ CAPITAL CORPORATION
SPROUT CAPITAL VIII L.P.
SPROUT VENTURE CAPITAL L.P.
THE 1818 MEZZANINE FUND, X.X.
XXXXXXX HIGH YIELD PARTNERS, L.P.
TSI CORPORATION
TCW LEVERAGED INCOME TRUST, L.P.
TCW LEVERAGED INCOME TRUST II, L.P.
TCW/CRESCENT MEZZANINE PARTNERS II, L.P.
TCW/CRESCENT MEZZANINE TRUST II
CRESCENT MACH I PARTNERS, L.P.
XXXXX X. XXXXXX
REAL X. XXXXXX
XXXXXX X. XXXXXXXXXXX
XXXXX X. XXXXX
XXXXXX X. XXXXXXXX
XXXXX PALM
CHRISTOPEHER BERTHOUX
JORG XXXXXX
XXXXX SUN XXX
By: DLJ MERCHANT BANKING PARTNERS II,
L.P., on behalf of itself and as
Attorney-In-Fact for each of the
Selling Stockholders listed above
By:
-------------------------------------
Name:
Title:
20
B&L CRL, INC.
By: [XXXXXXX X. XXXXXXXX / A. XXXXXX X.
XXXXXX], as Attorney-In-Fact for the
Selling Stockholder listed above
By:
-------------------------------------
Name:
Title:
XXXXXXX RIVER LABORATORIES
INTERNATIONAL, INC.
By:
-------------------------------------
Name:
Title:
The foregoing Underwriting Agreement is hereby
confirmed and accepted as of the date first
above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
XXXXXX BROTHERS INC.
XX XXXXX SECURITIES CORPORATION
U.S. BANCORP XXXXX XXXXXXX INC.
Acting on behalf of themselves and as the
Representatives of the several Underwriters
By: CREDIT SUISSE FIRST BOSTON CORPORATION
By:
--------------------------------------------------
Name:
Title:
21
SCHEDULE A
NUMBER OF NUMBER OF
NAME AND NOTICE ADDRESS FIRM SECURITIES OPTIONAL SECURITIES
NUMBER OF NUMBER OF
NAME AND NOTICE ADDRESS FIRM SECURITIES OPTIONAL SECURITIES
NUMBER OF NUMBER OF
NAME AND NOTICE ADDRESS FIRM SECURITIES OPTIONAL SECURITIES
NUMBER OF NUMBER OF
NAME AND NOTICE ADDRESS FIRM SECURITIES OPTIONAL SECURITIES
SCHEDULE B
NUMBER OF
UNDERWRITER FIRM SECURITIES
Credit Suisse First Boston Corporation................ [$]
Xxxxxx Brothers Inc...................................
XX Xxxxx Securities Corporation.......................
U.S. Bancorp Xxxxx Xxxxxxx Inc........................
---------------
Total........................................ [$]
===============
SCHEDULE C
NON-SELLING STOCKHOLDERS PROVIDING LOCK-UPS
Xxxxxxxx X. Xxxxxx
Xxxxxx Xxxxxxxx
Xxxxxxx X. Xxxxx
Xxxxxxxx Xxxx
Xxxxx Xxxxxx
Xxxxxxxxx Xxxxxxxxx
Xxxxxxx X. XxXxxxxx
Xxxx X. Xxxxxx
Xxxx Xxxxxx
Xxxxxxx Xxxxxx
Xxxxxx X. Thier
Xxxxxxx Xxxxxxx
Xxxxx Xxxxx III
EXHIBIT A
FORM OF LOCK-UP AGREEMENT
Xxxxxxx River Laboratories International, Inc.
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Credit Suisse First Boston Corporation
Xxxxxx Brothers Inc.
X X Xxxxx Securities Corporation
U.S. Bancorp Xxxxx Xxxxxxx Inc.
c/o Credit Suisse First Boston Corporation
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000]
Dear Sirs:
As an inducement to the Underwriters to execute the Underwriting Agreement,
pursuant to which an offering will be made that is intended to result in an
orderly market for the common stock, par value $0.01 per share (the
"SECURITIES") of Xxxxxxx River Laboratories International, Inc., and any
successor (by merger or otherwise) thereto, (the "COMPANY"), the undersigned
hereby agrees that from the date hereof and until 90 days after the public
offering date set forth on the final prospectus used to sell the Securities (the
"PUBLIC OFFERING DATE") pursuant to the Underwriting Agreement, to which you are
or expect to become parties, the undersigned will not offer, sell, contract to
sell, pledge or otherwise dispose of, directly or indirectly, any shares of
Securities or securities convertible into or exchangeable or exercisable for any
shares of Securities, enter into a transaction which would have the same effect,
or enter into any swap, hedge or other arrangement that transfers, in whole or
in part, any of the economic consequences of ownership of the Securities,
whether any such aforementioned transaction is to be settled by delivery of the
Securities or such other securities, in cash or otherwise, or publicly disclose
the intention to make any such offer, sale, pledge or disposition, or to enter
into any such transaction, swap, hedge or other arrangement, without, in each
case, the prior written consent of Credit Suisse First Boston Corporation. In
addition, the undersigned agrees that, without the prior written consent of
Credit Suisse First Boston Corporation, it will not, during the period
commencing on the date hereof and ending 90 days after the Public Offering Date,
make any demand for or exercise any right with respect to, the registration of
any Securities or any security convertible into or exercisable or exchangeable
for the Securities.
Any Securities received upon exercise of options granted to the undersigned
will also be subject to this Agreement. Any Securities acquired by the
undersigned in the open market will not be subject to this Agreement. A transfer
of Securities to a family member, affiliate, trust or other related party may be
made, provided the transferee agrees to be bound in writing by the terms of this
Agreement. A transfer of Securities may also be made to the Company.
In furtherance of the foregoing, the Company and its transfer agent and
registrar are hereby authorized to decline to make any transfer of shares of
Securities if such transfer would constitute a violation or breach of this
Agreement
This Agreement shall be binding on the undersigned and the successors,
heirs, personal representatives and assigns of the undersigned. This Agreement
shall lapse and become null and void if the Public Offering Date shall not have
occurred on or before September 1, 2001.
Very truly yours,
........................................
[NAME OF NON-SELLING STOCKHOLDER]
