EXHIBIT 1.01
I.C. XXXXXX & COMPANY, INC.
COMMON STOCK
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UNDERWRITING AGREEMENT
, 1997
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THE XXXXXXXX-XXXXXXXX COMPANY, LLC
XXXX XXXXX XXXX XXXXXX, INCORPORATED
As Representatives of the several Underwriters named in Schedule I hereto
c/o The Xxxxxxxx-Xxxxxxxx Company, LLC
0000 Xxxxxxxxx Xxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Ladies and Gentlemen:
I.C. Xxxxxx & Company, Inc., a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to issue and
sell to the Underwriters named in Schedule I (the "Underwriters") an
aggregate of 3,800,000 shares of common stock, par value $.0001 per share
("Common Stock"), of the Company (the "Firm Shares"), and at the election of
the Underwriters, subject to the terms and conditions stated herein, to issue
and sell to the Underwriters up to 570,000 additional shares of Common Stock
(the "Optional Shares") (the Firm Shares and the Optional Shares that the
Underwriters elect to purchase pursuant to Section 2 hereof are collectively
called the "Shares" ).
1. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, each of the Underwriters that:
(i) A registration statement on Form S-1 (File No. 333-37155)
(the "Initial Registration Statement") with respect to the Shares,
including a prospectus subject to completion, has been filed by the Company
with the Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933, as amended (the "Act"), and one or more amendments
to such Initial Registration Statement have been so filed. After the
execution of this Agreement, the Company will file with the Commission
either (A) if such Initial Registration Statement, as it may have been
amended, has become effective under the Act and information has been
omitted therefrom in accordance with Rule 430A under the Act, a
prospectus in the form most recently included in an amendment to such
Initial Registration Statement with such changes or insertions as are
required by Rule 430A or permitted by Rule 424(b) under the Act and as
have been provided to and approved by the Representatives, or (B) if such
Initial Registration Statement, as it may have been amended, has not
become effective under the Act, an amendment to such Initial Registration
Statement, including a form of prospectus, a copy of which amendment has
been provided to and approved by the Representatives prior to the
execution of this Agreement or (C) if such Initial Registration
Statement, as it may have been amended, has become effective under the
Act and the number of shares to be offered has subsequently been
increased, a registration statement (a "Rule 462(b) Registration
Statement"), filed pursuant to Rule 462(b) under the Act and as has been
provided to and approved by the Representatives. As used in this
Agreement, the term "Registration Statement" means such Initial
Registration Statement, as amended at the time when it was or is declared
effective, including all financial statement schedules and exhibits
thereto together with any Rule 462(b) Registration Statement and
including any information omitted therefrom pursuant to Rule 430A under
the Act and included in the Prospectus (as hereinafter defined); the term
"Preliminary Prospectus" means each prospectus subject to completion
included in such Initial Registration Statement or any amendment or
post-effective amendment thereto (including the prospectus subject to
completion, if any, included in the Registration Statement at the time it
was or is declared effective); and the term "Prospectus" means the
prospectus first filed with the Commission pursuant to Rule 424(b) under
the Act or, if no prospectus is required to be so filed, such term means
the prospectus included in the Registration Statement. For purposes of
the following representations and warranties, to the extent reference is
made to the Prospectus and at the relevant time the Prospectus is not yet
in existence, such reference shall be deemed to be to the most recent
Preliminary Prospectus.
(ii) No order preventing or suspending the use of any Preliminary
Prospectus has been issued and no proceeding for that purpose has been
instituted or threatened by the Commission or the securities authority of
any state or other jurisdiction. If the Registration Statement has become
effective under the Act, no stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued and, to the
knowledge of the Company, no proceeding for that purpose has been
instituted or threatened or is contemplated by the Commission or the
securities authority of any state or other jurisdiction.
(iii) When any Preliminary Prospectus was filed with the
Commission it (A) contained all statements required to be stated therein in
accordance with, and complied in all material respects with the
requirements of, the Act and the rules and regulations of
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the Commission thereunder and (B) did not include any untrue statement
of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. When the
Registration Statement or any amendment thereto was or is declared
effective, and at each Time of Delivery (as hereinafter defined),
it (A) contained or will contain all statements required to be
stated therein in accordance with, and complied or will comply in
all material respects with the requirements of, the Act and the
rules and regulations of the Commission thereunder and (B) did not
or will not include any untrue statement of a material fact or omit
to state any material fact necessary to make the statements therein
not misleading. When the Prospectus or any amendment or supplement
thereto is filed with the Commission pursuant to Rule 424(b) (or,
if the Prospectus or such amendment or supplement is not required
to be so filed, when the Registration Statement or the amendment
thereto containing such amendment or supplement to the Prospectus
was or is declared effective) and at each Time of Delivery, the
Prospectus, as amended or supplemented at any such time, (A)
contained or will contain all statements required to be stated
therein in accordance with, and complied or will comply in all
material respects with the requirements of, the Act and the rules
and regulations of the Commission thereunder and (B) did not or
will not include any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading. The foregoing provisions of this paragraph
(iii) do not apply to statements or omissions made in any
Preliminary Prospectus, the Registration Statement or any amendment
thereto or the Prospectus or any amendment or supplement thereto in
reliance upon and in conformity with written information furnished
to the Company by any Underwriter through you specifically for use
therein. The Company and the Underwriters hereby acknowledge that
the following constitutes the only information furnished in writing
to the Company by the Underwriters specifically for use in any
Preliminary Prospectus, the Registration Statement or the
Prospectus, or any such amendment or supplement: (i) the statements
in the last paragraph on the cover page of the Prospectus; (ii) the
statements with respect to stabilization in the paragraph at the
bottom of the inside front cover page of the Prospectus; and (iii)
the statements under the caption "Underwriting" in the Prospectus.
(iv) The descriptions in the Registration Statement and the
Prospectus of statutes, legal and governmental proceedings or contracts and
other documents are accurate and fairly present the information required to
be shown; and there are no statutes or legal or governmental proceedings
required to be described in the Registration Statement or the Prospectus
that are not described as required and no contracts or documents of a
character that are required to be described in the Registration Statement or
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the Prospectus or to be filed as exhibits to the Registration Statement
that are not described and filed as required.
(v) Each of the Company and its subsidiaries has been duly
incorporated, is validly existing as a corporation in good standing under
the laws of its jurisdiction of incorporation and has full power and
authority (corporate and other) to own or lease its properties and conduct
its business as described in the Prospectus. The Company has full power
and authority (corporate and other) to enter into this Agreement and to
perform its obligations hereunder. Each of the Company and its
subsidiaries is duly qualified to transact business as a foreign
corporation and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or conducts any
business, so as to require such qualification, except where the failure to
so qualify would not have a material adverse effect on the financial
position, results of operations or business of the Company.
(vi) The Company's authorized, issued and outstanding capital
stock is as disclosed in the Prospectus. All of the issued shares of
capital stock of the Company have been duly authorized and validly issued,
are fully paid and nonassessable and conform to the description of the
Common Stock contained in the Prospectus. None of the issued shares of
capital stock of the Company or its predecessors or any of its subsidiaries
has been issued or is owned or held in violation of any preemptive rights
of stockholders, and no person or entity (including any holder of
outstanding shares of capital stock of the Company or its subsidiaries) has
any preemptive or other rights to subscribe for any of the Shares.
(vii) All of the issued shares of capital stock of each of
the Company's subsidiaries have been duly authorized and validly issued,
are fully paid and nonassessable and are owned beneficially by the Company
free and clear of all liens, security interests, pledges, charges,
encumbrances, defects, stockholders' agreements, voting trusts, equities or
claims of any nature whatsoever. Other than the subsidiaries listed on
Exhibit 21.01 to the Registration Statement, the Company does not own,
directly or indirectly, any capital stock or other equity securities of any
corporation or any ownership interest in any partnership, joint venture or
other association.
(viii) There are no outstanding (A) securities or obligations
of the Company convertible into or exchangeable for any capital stock of
the Company, (B) warrants, rights or options to subscribe for or purchase
from the Company any such capital stock or any such convertible or
exchangeable securities or obligations, or (C) obligations of the Company
to issue any shares of capital stock, any such convertible or exchangeable
securities or obligations, or any such warrants, rights or options.
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(ix) Since the date of the most recent audited financial
statements included in the Prospectus, neither the Company nor any of its
subsidiaries has sustained 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 disclosed in or contemplated by
the Prospectus.
(x) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus, and other than as
disclosed in or contemplated by the Registration Statement and the
Prospectus, (A) the Company has not incurred any liabilities or
obligations, direct or contingent, or entered into any transactions, not in
the ordinary course of business, that are material to the Company and its
subsidiaries, (B) the Company has not purchased any of its outstanding
capital stock or declared, paid or otherwise made any dividend or
distribution of any kind on its capital stock, (C) there has not been any
material change in the capital stock, long-term debt or short-term debt of
the Company or any of its subsidiaries, and (D) there has not been any
material adverse change, or any development that the Company or any of its
subsidiaries reasonably expects to result in a material adverse change, in
or affecting the financial position, results of operations or business of
the Company or any of its subsidiaries.
(xi) The Shares to be issued and sold by the Company have been
duly authorized and, when issued and delivered against payment therefor as
provided herein, will be validly issued and fully paid and nonassessable
and will conform to the description of the Common Stock contained in the
Prospectus; and the certificates evidencing the Shares comply with all
applicable requirements of Delaware law.
(xii) 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 the Registration Statement (or any such
right has been effectively waived) or in any securities being registered
pursuant to any other registration statement filed by the Company under the
Act.
(xiii) All offers and sales of the Company's capital stock
prior to the date hereof were at all relevant times duly registered under
the Act or exempt from the registration requirements of the Act by reason
of Sections 3(b), 4(2) or 4(6) thereof and were duly registered or the
subject of an available exemption from the registration requirements of the
applicable state securities or blue sky laws.
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(xiv) Neither the Company nor any of its subsidiaries is, or
with the giving of notice or passage of time or both would not be, in
violation of its Certificate of Incorporation or Bylaws or in default under
any indenture, mortgage, deed of trust, loan agreement, lease or other
agreement or instrument to which the Company or any of its subsidiaries is
a party or to which any of its properties or assets are subject.
(xv) The issue and sale of the Shares to be issued and sold by
the Company and the performance of this Agreement and the consummation of
the transactions herein contemplated will not conflict with, or (with or
without the giving of notice or the passage of time or both) 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,
lease or other agreement or instrument to which the Company or any of its
subsidiaries is a party or to which any of their respective properties or
assets is subject, nor will such action conflict with or violate any
provision of the Certificate of Incorporation or Bylaws of the Company or
any statute, rule or regulation or any order, judgment or decree of any
court or governmental agency or body having jurisdiction over the Company
or any of its properties or assets.
(xvi) The Company and its subsidiaries have good and
indefeasible title in fee simple to all real property, if any, and good
title to all personal property owned by them, in each case free and clear
of all liens, security interests, pledges, charges, encumbrances, mortgages
and defects, except such as are disclosed in the Prospectus or such as do
not materially and adversely affect the value of such property and do not
interfere with the use made or proposed to be made of such property by the
Company and its subsidiaries; and any real property and buildings held
under lease by the Company or any of its subsidiaries are held under leases
which are valid and enforceable as to the Company and its subsidiaries and,
to the Company's knowledge, as to others, with such exceptions as are
disclosed in the Prospectus or are not material and do not interfere with
the use made or proposed to be made of such property and buildings by the
Company.
(xvii) No consent, approval, authorization, order or
declaration of or from, or registration, qualification or filing with, any
court or governmental agency or body is required for the sale of the Shares
or the consummation of the transactions contemplated by this Agreement,
except the registration of the Shares under the Act (which, if the
Registration Statement is not effective as of the time of execution hereof,
shall be obtained as provided in this Agreement) and such as may be
required from the National Association of Securities Dealers, Inc. (the
"NASD") and under state securities or blue sky laws in connection with the
offer, sale and distribution of the Shares by the Underwriters.
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(xviii) There is no litigation, arbitration, claim, proceeding
(formal or informal) or investigation pending or, to the Company's
knowledge, threatened (or any basis therefor) in which the Company or any
of its subsidiaries is a party or of which any of its properties or assets
are the subject which, if determined adversely to the Company or any such
subsidiary, would individually or in the aggregate reasonably be expected
to have a material adverse effect on the financial position, results of
operations or business of the Company and its subsidiaries. Neither the
Company nor any of its subsidiaries is in violation of, or in default with
respect to, any statute, rule, regulation, order, judgment or decree, or
such as do not and will not individually or in the aggregate have a
material adverse effect on the financial position, results of operations or
business of the Company and its subsidiaries.
(xix) To the Company's knowledge, BDO Xxxxxxx, LLP, who have
certified certain financial statements of the Company and its consolidated
subsidiaries, are and were during the periods covered by their reports
included in the Registration Statement and the Prospectus, independent
public accountants as required by the Act and the rules and regulations of
the Commission thereunder.
(xx) The financial statements and schedules (including the
related notes) of the Company and its consolidated subsidiaries included in
the Registration Statement, the Prospectus or any Preliminary Prospectus
were prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved and fairly present the
financial position and results of operations of the Company and its
subsidiaries, on a consolidated basis, at the dates and for the periods
presented. The selected financial data set forth under the captions
"Prospectus Summary--Summary Historical and ProForma Consolidated Financial
Data" and "Selected Financial Data" in the Prospectus fairly present, on
the basis stated in the Prospectus, the information included therein.
(xxi) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes the valid and binding agreement of
the Company enforceable against the Company in accordance with its terms,
subject, as to enforcement, to applicable bankruptcy, insolvency,
reorganization and moratorium laws and other laws relating to or affecting
the enforcement of creditors' rights generally and to general equitable
principles.
(xxii) Neither the Company nor any of its officers, directors
or other affiliates has (A) taken, directly or indirectly, any action
designed to cause or result in, or that has constituted or might reasonably
be expected to constitute, the stabilization or manipulation of the price
of any security of the Company to facilitate the sale or resale of
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the Shares or (B) since the filing of the Registration Statement (1)
sold, bid for, purchased or paid anyone any compensation for
soliciting purchases of, the Shares or (2) paid or agreed to pay to
any person any compensation for soliciting another to purchase any
other securities of the Company.
(xxiii) The Company has obtained for the benefit of the Company
and the Underwriters from each of its directors, executive officers and
current stockholders (the "Stockholders") a written agreement that for a
period of 180 days from the date of the Prospectus such director, executive
officer or Stockholder will not, without your prior written consent,
directly or indirectly sell, offer to sell, contract to sell, solicit an
offer to buy, grant any option for the purchase or sale of, assign, pledge,
distribute or otherwise transfer, dispose of or encumber (or make any
announcement with respect to any of the foregoing), any shares of Common
Stock, or any options, rights, warrants or other securities convertible
into or exercisable or exchangeable for Common Stock or evidencing any
right to purchase or subscribe for shares of Common Stock, whether or not
beneficially owned by the undersigned, except as provided in Section 2.
(xxiv) Neither the Company or any of its subsidiaries, nor any
director, officer, agent, employee or other person associated with or
acting on behalf of the Company has, directly or indirectly, used any
corporate funds for unlawful contributions, gifts, entertainment or other
unlawful expenses relating to political activity; made any unlawful payment
to foreign or domestic government officials or employees or to foreign or
domestic political parties or campaigns from corporate funds; violated any
provision of the Foreign Corrupt Practices Act of 1977, as amended; or made
any bribe, rebate, payoff, influence payment, kickback or other unlawful
payment.
(xxv) The operations of the Company and its subsidiaries with
respect to any real property currently leased or owned or by any means
controlled by the Company (the "Real Property") are in compliance with all
federal, state and local laws, ordinances, rules and regulations relating
to occupational health and safety and the environment (collectively,
"Laws"), and the Company and its subsidiaries have all licenses, permits and
authorizations necessary to operate under all Laws and are in compliance
with all terms and conditions of such licenses, permits and authorizations;
the Company and its subsidiaries have not authorized or conducted
and have no knowledge of the generation, transportation, storage, use,
treatment, disposal or release of any hazardous substance,
hazardous waste, hazardous material, hazardous constituent, toxic
substance, pollutant, contaminant, petroleum product, natural gas,
liquefied gas or synthetic gas defined or regulated under any
environmental law on, in or under any Real Property; and there is
no pending or threatened claim, litigation or any administrative
agency proceeding, nor has the Company or any subsidiary received
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any written or oral notice from any governmental entity or third party,
that: (A) alleges a violation of any Laws by the Company or any
subsidiary; (B) alleges the Company or any subsidiary is a liable
party under the Comprehensive Environmental Response, Compensation,
and Liability Act, 42 U.S.C. Section 9601 et seq. or any state
superfund law; (C) alleges possible contamination of the
environment by the Company or any subsidiary; or (D) alleges
possible contamination of the Real Property.
(xxvi) The Worldwide Rights Agreement dated September 30, 1997
among the Company, Brookhurst, Inc. and Xxxxxxx Xxx (the "Worldwide
Agreement"), and the Foreign Boss Rights Acquisition Agreement dated
September 30, 1997 between the Company, Hugo Boss, A.G. and Ambra, Inc.
(the "Foreign Agreement" and, together with the Worldwide Agreement, the
"Boss Agreements"), have been duly authorized, executed and delivered by
the Company and are enforceable by the Company against the respective
parties to the Boss Agreements in accordance with their terms, except to
the extent that enforcement thereof may be limited by (a) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally and (b) general
principles of equity (regardless of whether enforceability is considered in
a proceeding at law or in equity). The Company and each of its
subsidiaries have fulfilled and performed all of their material obligations
with respect to the Boss Agreements, and related agreements, and the Boss
Agreements, and related agreements, remain in full force and effect; and no
event has occurred with respect to the Boss Agreements, and related
agreements, which would have a material adverse effect on the business of
the Company or its subsidiaries.
(xxvii) The Exclusive Domestic License Agreement dated June 1,
1993 by and between BHPC Marketing, Inc. ("BHPCM") and Xxxxxxx-Xxxxx XX
Industries, Inc. ("HPII"), the Assignment of Licenses dated August 31, 1993
by and between HPII and the Company, the Amendment dated September 1, 1993
by and between BHPCM and the Company, the Exclusive Domestic License
Agreement dated December 14, 1995 by and between BHPCM and the Company, the
Amendment to Exclusive License Agreement dated June 3, 1997 by and between
BHPCM and the Company, the Amendment to Exclusive License Agreement dated
June 1, 1997 by and between BHPCM and the Company, the Amendment to
Exclusive License Agreement dated July 29, 1997 by and between BHPCM and
the Company, the International Exclusive License Agreement (Wholesale)
dated August 15, 1996 by and between BHPCM and Zacari 2000 S.L., the
Amendment to International Exclusive License Agreement (Wholesale) dated
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June 3, 1997 by and between BHPCM and I.C. Xxxxxx Europe, S.L. ("ICI
Europe"), the International Exclusive License Agreement (Retail)
dated August 15, 1996 by and between BHPCM and Zacari 2000, S.L.,
the Amendment to International Exclusive License Agreement (Retail)
dated June 3, 1997 by and between BHPCM and ICI Europe and the
Amendment to Exclusive License Agreement dated July 29, 1996 by and
between BHPCM and ICI Europe (all of the above are together herein
known as the "BHPC Agreements"), have been duly authorized,
executed and delivered by the Company and are enforceable by the
Company against the respective parties to the BHPC Agreements in
accordance with their terms, except to the extent that enforcement
thereof may be limited by (a) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter
in effect relating to creditors' rights generally and (b) general
principles of equity (regardless of whether enforceability is
considered in a proceeding at law or in equity). The Company and
each of its subsidiaries have fulfilled and performed all of their
material obligations with respect to the BHPC Agreements and the
BHPC Agreements remain in full force and effect; and no event has
occurred with respect to the BHPC Agreements which would have a
material adverse effect on the business of the Company or its
subsidiaries.
(xxviii) The Company and its subsidiaries own or possess, or are
licensed or otherwise have the full legal right to utilize, the patents,
patent rights, licenses, inventions, copyrights, know-how, trademarks
(including, without limitation, the exclusive right to use the marks "BOSS"
and "XXXXXXX HILLS POLO CLUB" and related marks and logos upon the terms
and conditions set forth in the BOSS Agreements and the BHPC Agreements,
respectively, and as described in the Prospectus and the marks "I.C.
XXXXXX", "I.G. DESIGN", "LORD XXXXXX" and "PIZZAZZ"), service marks, trade
names and other intangible property (collectively, the "Intellectual
Property Rights") presently employed by them in connection with the
business now operated by them except where the failure to so own or possess
such legal rights could not reasonably be expected to have a material
adverse effect on the business of the Company or its subsidiaries, and
neither the Company nor any of its subsidiaries has received any notice or
is otherwise aware of any infringement of or conflict with asserted rights
of others with respect to any intellectual property rights or other
proprietary rights which, singularly or in the aggregate, if the subject of
an unfavorable final determination, could reasonably be expected to have a
material adverse effect on the business of the Company or its subsidiaries.
(xxix) The Company has delivered or made available to you
prior to the date the Registration Statement was declared effective copies
of all pension, retirement, profit-sharing, deferred compensation, stock
option, employee stock ownership, severance pay, vacation, bonus or other
incentive plans, all other written employee programs, arrangements or
agreements, all medical, vision, dental or other health plans, all life
insurance plans and all other employee benefit plans or fringe benefit
plans, including, without limitation, "employee benefit plans" as that term
is defined in Section 3(3) of the Employee Retirement Income Security Act
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of 1974, as amended ("ERISA"), adopted, maintained, sponsored in whole
or in part or contributed to by the Company or any of its
subsidiaries or their respective predecessors for the benefit of
employees, retirees, dependents, spouses, directors, independent
contractors or other beneficiaries and under which employees,
retirees, dependents, spouses, directors, independent contractors or
other beneficiaries are eligible to participate (collectively, the
"Company Benefit Plans").
The Company or any of its subsidiaries (and each of their respective
predecessors that adopted or contributed to a Company Benefit Plan) has
maintained all Company Benefit Plans (including filing all reports and
returns required to be filed with respect thereto) in accordance with their
terms and in compliance with the applicable terms of ERISA, the Internal
Revenue Code and any other applicable federal and state laws, except for
any breach or violation which would not have, individually or in the
aggregate, a material adverse effect on the financial position, results of
operations or business of the Company and its subsidiaries, taken as a
whole. Each Company Benefit Plan which is intended to be qualified under
Section 401(a) of the Internal Revenue Code has either received a favorable
determination letter from the Internal Revenue Service or will timely
request such a letter prior to the expiration of any remedial amendment
period applicable without penalty to the Company Benefit Plan under the
Internal Revenue Code and has at all times been maintained in accordance
with Section 401 of the Internal Revenue Code, except where any failure to
so maintain such Company Benefit Plan would not have, individually or in
the aggregate, a material adverse effect on the financial position, results
of operations or business of the Company and its subsidiaries, taken as a
whole. Neither the Company nor any subsidiary has engaged in a transaction
with respect to any Company Benefit Plan that, assuming the taxable period
of such transaction expired as of the date hereof, would subject the
Company or any subsidiary to a tax or penalty imposed by either Section
4975 of the Internal Revenue Code or Section 502(i) of ERISA in amounts
which are reasonably likely to have, individually or in the aggregate, a
material adverse effect on the financial position, results of operations or
business of the Company and its subsidiaries, taken as a whole.
Neither the Company nor any subsidiary is obligated to provide
post-retirement medical benefits or any other unfunded post-retirement
welfare benefits, which such liabilities to the Company or any subsidiary
would have, individually or in the aggregate, a material adverse effect on
the financial position, results of operations or business of the Company
and its subsidiaries, taken as a whole. Neither the Company, its
subsidiaries, nor any member of a group of trades or businesses under
common control (as defined in ERISA Sections 4001(a)(14) and 4001(b)(1))
with the Company or its subsidiaries have at any time within the last six
years sponsored, contributed to or been obligated under Title I or IV of
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ERISA to contribute to a "defined benefit plan" (as defined in ERISA Section
3(35)). Within the last six years, neither the Company, its subsidiaries
nor any member of a group of trades or businesses under common control
(as defined in ERISA Sections 4001(a)(14) and 4001(b)(1)) with Company or
its subsidiaries have had an "obligation to contribute" (as defined in
ERISA Section 4212) to a "multiemployer plan" (as defined in ERISA
Sections 4001(a)(3) and 3(37)(A)).
(xxx) No labor dispute exists or is imminent with the
Company's or its subsidiaries' employees or is imminent which could
materially adversely affect the financial position, results of operations
or business of the Company and its subsidiaries. The Company is not
aware of any existing or imminent labor disturbance by its or its
subsidiaries' employees which could be expected to adversely affect the
financial position, results of operations or business of the Company and
its subsidiaries.
(xxxi) The Company and each of its subsidiaries are insured
by insurers of recognized financial responsibility against such losses
and risks and in such amounts as are customary in the businesses in which
they are engaged; and neither the Company nor any such subsidiary has
knowledge of any facts or circumstances that would prevent the renewal of
its existing insurance coverage as and when such coverage expires or that
would prevent such entity from obtaining similar coverage from similar
insurers as may be necessary to continue its business at a comparable
cost, except as disclosed in the Prospectus.
(xxxii) Each of the Company and its subsidiaries makes and
keeps accurate books and records reflecting its assets and maintains
internal accounting controls which provide reasonable assurance that (A)
transactions are executed in accordance with management's authorization,
(B) transactions are recorded as necessary to permit preparation of the
Company's consolidated financial statements in accordance with generally
accepted accounting principles and to maintain accountability for the
assets of the Company and its subsidiaries, (C) access to the assets of
the Company and each of its subsidiaries is permitted only in accordance
with management's authorization, and (D) the recorded accountability for
assets of the Company and each of its subsidiaries is compared with
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(xxxiii) The Company's software systems include design,
performance and functionality so that the Company does not reasonably
expect to experience invalid or incorrect results or abnormal software
operation related to calendar year 2000. The Company's software systems
include calendar year 2000 date conversion and compatibility
capabilities, including, but not limited to, date data century
recognition, same century and multiple century formula and date value
calculations, and user interface date data values that reflect the
century.
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(xxxiv) No subsidiary of the Company is currently prohibited,
directly or indirectly, from paying any dividends to the Company, from
making any other distributions on such subsidiary's capital stock, from
repaying to the Company any loans or advances to such subsidiary or from
transferring any of such subsidiary's property or assets to the Company
or any other subsidiary of the Company.
(xxxv) The Company and its subsidiaries have filed all
foreign, federal, state and local tax returns that are required to be
filed by them and have paid all taxes shown as due on such returns as
well as all other taxes, assessments and governmental charges that are
due and payable, and no deficiency with respect to any such return has
been assessed or proposed. All applicable income and employment taxes
have been withheld and paid for any individuals who would be considered
common law employees of the Company and its subsidiaries for federal
income and employment tax withholding purposes.
(xxxvi) The Company is not, will not become as a result of
the transactions contemplated hereby, and does not intend to conduct its
business in a manner that would cause it to become, an "investment
company" or a company "controlled" by an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
2. Purchase and Sale of Shares. Subject to the terms and conditions
herein set forth, (a) the Company agrees to sell to each of the Underwriters,
and each of the Underwriters agrees, severally and not jointly, to purchase
from the Company at a purchase price of $______ per share, the number of Firm
Shares (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying the aggregate number of Firm Shares to be sold by
the Company by a fraction, the numerator of which is the aggregate number of
Firm Shares to be purchased by such Underwriter as set forth opposite the
name of such Underwriter in Schedule I hereto, and the denominator of which
is the aggregate number of Firm Shares to be purchased by the Underwriters
from the Company hereunder and (b) in the event and to the extent that the
Underwriters shall exercise the election to purchase Optional Shares as
provided below, the Company agrees to issue and sell to each of the
Underwriters, severally and not jointly, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the purchase
price per share set forth in clause (a) of this Section 2, that portion of
the number of Optional Shares to be sold by the Company as to which such
election shall have been exercised (to be adjusted by you so as to eliminate
fractional shares) determined by multiplying such number of Optional Shares
by a fraction, the numerator of which is the maximum number of Optional
Shares that such Underwriter is entitled to purchase as set forth opposite
the name of such Underwriter in Schedule I hereto and the denominator of
which is the maximum number of the Optional Shares that all of the Underwriters
13
are entitled to purchase hereunder.
The Company hereby grants to the Underwriters the right to purchase, at
their election in whole or in part from time to time, up to 570,000 Optional
Shares, at the purchase price per share set forth in clause (a) in the
paragraph above, for the sole purpose of covering over-allotments in the sale
of Firm Shares. Any such election to purchase Optional Shares may be
exercised by written notice from you to the Company, given from time to time
within a period of 30 calendar days after the date of this Agreement and
setting forth the aggregate number of Optional Shares to be purchased and the
date on which such Optional Shares are to be delivered, as determined by you
but in no event earlier than the First Time of Delivery (as hereinafter
defined) or, unless you and the Company otherwise agree in writing, earlier
than two or later than ten business days after the date of such notice. In
the event you elect to purchase all or a portion of the Optional Shares, the
Company agrees to furnish or cause to be furnished to you the certificates,
letters and opinions, and to satisfy all conditions, set forth in Section 7
hereof at each Subsequent Time of Delivery (as hereinafter defined).
3. Offering by the Underwriters. Upon the authorization by you of the
release of the Shares, the several Underwriters propose to offer the Shares
for sale upon the terms and conditions disclosed in the Prospectus.
4. Delivery of Shares; Closing. Certificates in definitive form for
the Shares to be purchased by each Underwriter hereunder, and in such
denominations and registered in such names as The Xxxxxxxx-Xxxxxxxx Company,
LLC may request upon at least 48 hours' prior notice to the Company, shall be
delivered by or on behalf of the Company to you for the account of such
Underwriter against payment by such Underwriter on its behalf of the purchase
price therefor by wire transfer or certified or official bank check or checks
drawn on an Atlanta, Georgia bank, payable to the order of the Company and
the Custodian, as their interests may appear, in same-day available funds.
The closing of the sale and purchase of the Shares shall be held at the
offices of Xxxxxx & Bird LLP, One Atlantic Center, 0000 Xxxx Xxxxxxxxx
Xxxxxx, Xxxxxxx, Xxxxxxx 00000-0000, or at such other location as you, the
Company and the Attorneys-in-Fact may agree upon, except that physical
delivery of such certificates shall be made at the office of The Depository
Trust Company, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000. The time and date
of such delivery and payment shall be, with respect to the Firm Shares, at
9:00 a.m., Atlanta time, on the third (or if the Firm Shares are priced, as
contemplated by Rule 15c6-1(c) promulgated pursuant to the Securities Act of
1934, as amended (the "Exchange Act"), after 4:30 p.m., Washington, D.C.
time, the fourth) full business day after this Agreement is executed or at
such other time and date not less than the seventh full business day
thereafter as you and the Company may agree upon in writing, and, with
respect to the Optional Shares, at 9:00 a.m., Atlanta time, on the date and
at the location specified by you in the written notice given by you of the
Underwriters' election to purchase all or part of such Optional Shares,
14
or at such other time and date as you and the Company may agree upon. Such
time and date for delivery of the Firm Shares is herein called the "First
Time of Delivery," such time and date for delivery of any Optional Shares, if
not the First Time of Delivery, is herein called a "Subsequent Time of
Delivery," and each such time and date for delivery is herein called a "Time
of Delivery." The Company will make such certificates available for checking
and packaging at least 24 hours prior to each Time of Delivery at the office
of The Depository Trust Company, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 or
at such other location in New York, New York specified by you in writing at
least 48 hours prior to such Time of Delivery.
5. Covenants of the Company. The Company covenants and agrees with
each of the Underwriters:
(i) If the Registration Statement has been declared effective
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 you,
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 fifth business day after the date on which the
Registration Statement is declared effective. The Company will advise
you promptly of any such filing pursuant to Rule 424(b).
(ii) The Company will not file with the Commission the
prospectus or the amendment referred to in the second sentence of Section
l(a)(i) hereof, any amendment or supplement to the Prospectus or any
amendment to the Registration Statement unless you have received a
reasonable period of time to review any such proposed amendment or
supplement and consented to the filing thereof and will use its best
efforts to cause any such amendment to the Registration Statement to be
declared effective as promptly as possible. Upon the request of the
Representatives or counsel for the Underwriters, the Company will
promptly prepare and file with the Commission, in accordance with the
rules and regulations of the Commission, any amendments to the
Registration Statement or amendments or supplements to the Prospectus
that may be necessary or advisable in connection with the distribution of
the Shares by the several Underwriters and will use its best efforts to
cause any such amendment to the Registration Statement to be declared
effective as promptly as possible. If required, the Company will file
any amendment or supplement to the Prospectus with the Commission in the
manner and within the time period required by Rule 424(b) under the Act.
The Company will advise the Representatives, promptly after receiving
notice thereof, of the time when the Registration Statement or any
amendment thereto has been filed or declared effective or the Prospectus
or any amendment or supplement thereto has been filed and will provide
evidence to the Representatives of each such filing or effectiveness.
15
(iii) If the Company elects to rely upon Rule 462(b), the
Company shall file a Rule 462(b) Registration Statement with the
Commission in compliance with Rule 462(b) by 10:00 p.m. Washington, D.C.
time, on the date of this Agreement, and the Company shall at the time of
filing either pay to the Commission the filing fee for the Rule 462(b)
Registration Statement or give irrevocable instructions for the payment
of such fee pursuant to Rule 111(b) under the Act.
(iv) The Company will advise you promptly after receiving
notice or obtaining knowledge of (A) the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement
or any part thereof or any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus or any amendment or supplement
thereto or of the initiation or threatening of any proceeding for any
such purpose, (B) the suspension of the qualification of the Shares for
offer or sale in any jurisdiction or of the initiation or threatening of
any proceeding for any such purpose, or (C) any request made by the
Commission or any securities authority of any other jurisdiction for
amending the Registration Statement, for amending or supplementing the
Prospectus or for additional information. The Company will use its best
efforts to prevent the issuance of any such stop order and, if any such
stop order is issued, to obtain the withdrawal thereof as promptly as
possible.
(v) If the delivery of a prospectus relating to the Shares is
required under the Act at any time prior to the expiration of nine months
after the date of the Prospectus and if at such time any events have
occurred 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 in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, or if for any reason it is necessary during such same period
to amend or supplement the Prospectus to comply with the Act or the rules
and regulations thereunder, the Company will promptly notify you, and at
the Company's expense, prepare and file with the Commission an amendment
or supplement to the Prospectus that corrects such statement or omission
or effects such compliance and will furnish without charge to each
Underwriter and to any dealer in securities as many copies of such
amended or supplemented Prospectus as you may from time to time
reasonably request. If the delivery of a prospectus relating to the
Shares is required under the Act at any time nine months or more after
the date of the Prospectus, upon your request but at the expense of such
Underwriter, the Company will prepare and deliver to such Underwriter as
many copies as you may request of an amended or supplemented Prospectus
complying with Section 10(a)(3) of the Act. Neither your consent to, nor
the Underwriters' delivery of, any such amendment or supplement shall
16
constitute a waiver of any of the conditions set forth in Section 7.
(vi) The Company promptly from time to time will take such
action as you may reasonably request to qualify the Shares for offering
and sale under the securities or blue sky laws of such jurisdictions as
you may request and will continue such qualifications in effect for as
long as may be necessary to complete the distribution of the Shares,
provided that in connection therewith the Company shall not be required
to qualify as a foreign corporation or to file a general consent to
service of process in any jurisdiction.
(vii) The Company will promptly provide you, without
charge, (A) two manually executed copies of the Registration Statement as
originally filed with the Commission and of each amendment thereto, (B)
for each other Underwriter a conformed copy of the Registration Statement
as originally filed and of each amendment thereto, without exhibits, and
(C) so long as a prospectus relating to the Shares is required to be
delivered under the Act, as many copies of each Preliminary Prospectus or
the Prospectus or any amendment or supplement thereto as you may
reasonably request.
(viii) As soon as practicable, but in any event not later
than 45 days after the end of the Company's fiscal quarter in which the
first anniversary of the effective date of the Registration Statement
occurs, the Company will make generally available to its security holders
an earnings statement of the Company and its subsidiaries, if any,
covering a period of at least 12 months beginning after the effective
date of the Registration Statement (which need not be audited) complying
with Section 11(a) of the Act and the rules and regulations thereunder.
(ix) During the period beginning on the date hereof and
continuing to and including the date 180 days after the date of the
Prospectus, the Company will not, without your prior written consent,
offer, pledge, issue, sell, contract to sell, grant any option for the
sale of, or otherwise dispose of (or announce any of the foregoing,
directly or indirectly, any shares of Common Stock or securities
convertible into, exercisable or exchangeable for, shares of Common
Stock, except as provided in Section 2 and except that the Company may
(A) grant options pursuant to the Company's stock option plans described
in the Registration Statement with the prior approval of The
Xxxxxxxx-Xxxxxxxx Company, LLC; and (B) issue shares of Common Stock upon
the exercise of any of the Company's outstanding stock options as
described in the Registration Statement or stock options granted under
clause (A) above.
(x) During a period of five years from the effective date of
the Registration Statement, the Company will furnish to you and, upon
request, to each of the other Underwriters, without charge, (A) copies of
17
all reports or other communications (financial or other) furnished to
Stockholders, (B) as soon as they are available, copies of any
reports and financial statements furnished to or filed with the
Commission, the NASD or any national securities exchange, and (C)
such additional information concerning the business and financial
condition of the Company and its subsidiaries, if any, as you may
reasonably request.
(xi) Neither the Company nor any of its officers, directors or
other affiliates will (A) take, directly or indirectly, prior to the
termination of the underwriting syndicate contemplated by this Agreement,
any action designed to cause or to result in, or that might reasonably be
expected to constitute, the stabilization or manipulation of the price of
any security of the Company to facilitate the sale or resale of any of
the Shares, (B) sell, bid for, purchase or pay anyone any compensation
for soliciting purchases of, the Shares or (C) pay or agree to pay to any
person any compensation for soliciting another to purchase any other
securities of the Company.
(xii) The Company will apply the net proceeds from the
offering in the manner set forth under "Use of Proceeds" in the
Prospectus.
(xiii) The Company will cause the Shares to be listed on the
Nasdaq National Market at each Time of Delivery and for at least one year
from the date hereof.
(xiv) If at any time during the period beginning on the
date the Registration Statement becomes effective and ending on the later
of (A) the date 30 days after such effective date and (B) the date that
is the earlier of (1) the date on which the Company first files with the
Commission a Quarterly Report on Form 10-Q or an Annual Report on Form
10-K after such effective date and (2) the date on which the Company
first issues a quarterly or annual financial report to Stockholders after
such effective date, any rumor, publication or event relating to or
affecting the Company shall occur as a result of which in your reasonable
opinion the market price of the Common Stock has been or is likely to be
materially affected (regardless of whether such rumor, publication or
event necessitates an amendment of or supplement to the Prospectus), the
Company will, after written notice from you advising the Company to the
effect set forth above, forthwith prepare, consult with you concerning
the substance of, and disseminate a press release or other public
statement, reasonably satisfactory to you, responding to or commenting on
such rumor, publication or event.
6. Expenses. The Company will pay all costs and expenses incident to
the performance of its obligations under this Agreement, whether or not the
transactions contemplated hereby are consummated or this Agreement is
terminated pursuant to Section 10 hereof, including, without limitation,
18
all costs and expenses incident to (i) the reasonable fees, disbursements and
expenses of the Company's counsel and accountants in connection with the
registration of the Shares under the Act and all other expenses in connection
with the preparation, printing and filing of the Registration Statement
(including all amendments thereto), any Preliminary Prospectus, the
Prospectus and, if applicable, any amendments and supplements thereto, this
Agreement and any blue sky memoranda; (ii) the delivery of copies of the
foregoing documents to the Underwriters; (iii) the filing fees of the
Commission and the NASD relating to the Shares and the related reasonable
fees and disbursements of counsel for the Underwriters in connection with
filings with the NASD; (iv) the preparation, issuance and delivery to the
Underwriters of any certificates evidencing the Shares, including transfer
agent's and registrar's fees; (v) the qualification of the Shares for
offering and sale under state securities and blue sky laws, including filing
fees and reasonable fees and disbursements of counsel for the Underwriters
relating thereto; (vi) any listing of the Shares on the Nasdaq National
Market and (vii) any reasonable expenses for travel, lodging and meals
incurred by the Company and any of its officers, directors and employees in
connection with any meetings with prospective investors in the Shares. It is
understood, however, that, except as provided in this Section, Section 8 and
Section 10 hereof, the Underwriters will pay all of their own costs and
expenses, including the fees of their counsel, stock transfer taxes on resale
of any of the Shares by them, and any advertising expenses relating to the
offer and sale of the Shares.
7. Conditions of the Underwriters' Obligations. The obligations of the
Underwriters hereunder to purchase and pay for the Shares to be delivered at
each Time of Delivery shall be subject, in their discretion, to the accuracy
of the representations and warranties of the Company contained herein as of
the date hereof and as of such Time of Delivery, to the accuracy of the
statements of Company officers made pursuant to the provisions hereof, to the
performance by the Company of their covenants and agreements hereunder, and
to the following additional conditions precedent:
(a) If the registration statement as amended to date has not become
effective prior to the execution of this Agreement, such registration
statement shall have been declared effective not later than 4:00 p.m.,
Atlanta time, on the day following the date of this Agreement or such later
date and/or time as shall have been consented to by you in writing. The
Prospectus and any amendment or supplement thereto shall have been filed with
the Commission pursuant to Rule 424(b) within the applicable time period
prescribed for such filing and in accordance with Section 5(a) of this
Agreement; if the Company has elected to rely upon Rule 462(b), the Rule
462(b) Registration Statement shall have become effective by 10:00 p.m.
Washington, D.C. time, on the date of this Agreement; no stop order
suspending the effectiveness of the Registration Statement or any part
thereof shall have been issued and no proceedings for that purpose shall have
been instituted, threatened or, to the knowledge of the Company and the
Representatives, contemplated by the Commission; and all requests for additional
19
information on the part of the Commission shall have been complied with to
your reasonable satisfaction.
(b) Xxxxxx & Bird LLP, counsel for the Underwriters, shall have
furnished to you such opinion or opinions, dated such Time of Delivery, with
respect to the incorporation of the Company, the validity of the Shares being
delivered at such Time of Delivery, the Registration Statement, the
Prospectus, and other related matters as you may reasonably request, 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.
(c) You shall have received an opinion, dated such Time of
Delivery, of Piper & Marbury L.L.P., counsel for the Company, in form and
substance reasonably satisfactory to you and your counsel, to the effect that:
(i) The Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the State of
Delaware and has the corporate power and authority to own or lease its
properties and conduct its business as described in the Registration
Statement and the Prospectus and to enter into this Agreement and perform
its obligations hereunder. The Company is duly qualified to transact
business as a foreign corporation and is in good standing under the laws
of each other jurisdiction in which it owns or leases property, or
conducts any business, except where the failure to so qualify would not
have a material adverse effect on the financial position, results of
operations or business of the Company.
(ii) Each of the subsidiaries of the Company has been duly
incorporated, is validly existing as a corporation in good standing under
the laws of its jurisdiction of incorporation and has the corporate power
and authority to own or lease its properties and conduct its business as
described in the Registration Statement and the Prospectus. Each such
subsidiary is duly qualified to transact business as a foreign
corporation and is in good standing under the laws of each other
jurisdiction in which it owns or leases property, or conducts any
business, except where the failure to so qualify would not have a
material adverse effect on the financial position, results of operations
or business of the Company and its subsidiaries taken as a whole.
(iii) The Company's authorized, issued and outstanding
capital stock is as disclosed in the Prospectus. All of the issued
shares of capital stock of the Company have been duly authorized and
validly issued, are fully paid and nonassessable and conform to the
description of the Common Stock contained in the Prospectus. None of the
issued shares of capital stock of the Company, or its predecessors, or
any of its subsidiaries, has been issued or is owned or held in violation
of any statutory preemptive rights of stockholders, and no person or
20
entity (including any holder of outstanding shares of capital stock of
the Company or its subsidiaries) has any statutory preemptive or, to such
counsel's knowledge, other rights to subscribe for any of the Shares.
(iv) Except as disclosed in the Prospectus, all of the issued
shares of capital stock of each of the Company's subsidiaries have been
duly authorized and validly issued, are fully paid and nonassessable, and
are owned beneficially by the Company free and clear of all liens,
security interests, pledges, charges, encumbrances, stockholders'
agreements, voting trusts, defects, equities or claims of any nature
whatsoever. Other than the subsidiaries listed on Exhibit 22.01 to the
Registration Statement, the Company does not own, directly or indirectly,
any capital stock or other equity securities of any other corporation or
any ownership interest in any partnership, joint venture or other
association.
(v) There are no outstanding (A) securities or obligations of
the Company convertible into or exchangeable for any capital stock of the
Company, (B) warrants, rights or options to subscribe for or purchase
from the Company any such capital stock or any such convertible or
exchangeable securities or obligations or (C) obligations of the Company
to issue any shares of capital stock, any such convertible or
exchangeable securities or obligations, or any such warrants, rights or
options.
(vi) The Shares to be issued and sold by the Company have been
duly authorized and, when issued and delivered against payment therefor
as provided herein, will be validly issued and fully paid and
nonassessable and will conform to the description of the Common Stock
contained in the Prospectus; the form of certificate evidencing the
Shares complies with all applicable requirements of Delaware law; and the
Shares have been approved to be listed on the Nasdaq National Market.
(vii) 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 the Registration Statement (or any such
right has been effectively waived) or in any securities being registered
pursuant to any other registration statement filed by the Company under
the Act.
(viii) All offers and sales of the Company's capital stock
prior to the date hereof were at all relevant times duly registered under
the Act or exempt from the registration requirements of the Act by reason
of Sections 3(b), 4(2) or 4(6) thereof, or if not registered or exempt in
compliance with the Act, any private rights of action for rescission or
21
damages arising from such failure to register any such securities are
time barred by applicable statutes of limitations or equitable
principles, including laches.
(ix) Neither the Company nor any of its subsidiaries is, or
with the giving of notice or passage of time or both, would be, in
violation of its respective Certificate of Incorporation or Bylaws or in
default under any indenture, mortgage, deed of trust, loan agreement,
lease or other agreement or instrument to which the Company or any such
subsidiary is a party or to which any of their respective properties or
assets is subject and which is required to be included as an exhibit to
the Registration Statement.
(x) The issue and sale of the Shares being issued at such Time
of Delivery and the performance of this Agreement and the consummation of
the transactions herein contemplated will not conflict with, or (with or
without the giving of notice or the passage of time or both) 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,
lease or other agreement or instrument to which the Company or any
subsidiary is a party or to which any of their respective properties or
assets is subject nor will such action conflict with or violate any
provision of the Certificate of Incorporation or Bylaws of the Company or
any of its subsidiaries or any statute, rule or regulation (assuming
compliance with all applicable state securities or blue sky laws, as to
which such counsel need express no opinion) or any order, judgment or
decree of any court or governmental agency or body having jurisdiction
over the Company or any of its subsidiaries or any of their respective
properties or assets.
(xi) No consent, approval, authorization, order or declaration
of or from, or registration, qualification or filing with, any court or
governmental agency or body is required for the issue and sale of the
Shares or the consummation of the transactions contemplated by this
Agreement, except the registration of the Shares under the Act and such
as may be required from the NASD or under state securities or blue sky
laws in connection with the offer, sale and distribution of the Shares by
the Underwriters.
(xii) The Company and its subsidiaries have good and
indefeasible title in fee simple to all real property owned by them, in
each case free and clear of all liens, security interests, pledges,
charges, encumbrances, mortgages and defects except such as are disclosed
in the Prospectus or such as do not materially and adversely affect the
value of such property and do not materially interfere with the use made
of such property by the Company and its subsidiaries; and any real
property and buildings held by the Company or any of its subsidiaries
under leases are held under leases which are valid and enforceable as to the
22
Company and its subsidiaries and, to such counsel's knowledge, as to
others, with such exceptions as are disclosed in the Prospectus or are
not material and do not interfere with the use made of such property and
buildings by the Company and its subsidiaries.
(xiii) To such counsel's knowledge, there is no litigation,
arbitration, claim, proceeding (formal or informal) or investigation
pending or threatened in which the Company or any of its subsidiaries is
a party or of which any of their respective properties or assets is the
subject which, if determined adversely to the Company or any of its
subsidiaries, individually or in the aggregate, reasonably would be
expected to have a material adverse effect on the financial position,
results of operations or business of the Company and its subsidiaries;
and, to such counsel's knowledge, neither the Company nor any of its
subsidiaries is in violation of, or in default with respect to, any
statute, rule, regulation, order, judgment or decree, except as do not
and will not individually or in the aggregate have a material adverse
effect on the financial position, results of operations or business of
the Company.
(xiv) The Company and its subsidiaries own or have the
right to use all patents, trademarks, trade names, service marks,
copyrights, and applications therefor; franchises; trade secrets;
proprietary or other confidential information and intangible
properties and assets (collectively, "Intangibles"), including, but
not limited to, the exclusive right to use the marks "BOSS" and
"XXXXXXX HILLS POLO CLUB" and related marks and logos upon the terms
and conditions set forth in the BOSS Agreements and BHPC Agreements,
respectively, and as described in the Prospectus and the marks "I.C.
XXXXXX", "I.G. DESIGN," "LORD XXXXXX" and "PIZZAZZ," presently
employed by it in connection with its business as presently
conducted or as the Prospectus indicates the Company proposes to
conduct; to the knowledge of such counsel, neither the Company nor
its subsidiaries have infringed and are not infringing, nor will the
conduct of Company's business as proposed in the Prospectus
infringe, and neither the Company nor its subsidiaries have received
notice of infringement with respect to asserted Intangibles of
others; and, to the knowledge of such counsel, there is no
infringement by others of Intangibles of the Company or its
subsidiaries.
(xv) The employment agreements in effect between the Company
and its employees are valid and enforceable; provided, however, that
such counsel need not render any opinion with regard to the validity and
enforceability of any non-compete provision contained therein; and
provided further, that the invalidity or unenforceability of any such
non-compete agreement shall not render the remainder of such agreement,
or any of the other provisions thereof, invalid or unenforceable.
23
(xvi) This Agreement has been duly authorized, executed and
delivered by the Company and, assuming that this Agreement is a valid and
binding agreement of the other parties hereto, constitutes the valid and
binding agreement of the Company enforceable against the Company in
accordance with its terms, subject, as to enforcement, to applicable
bankruptcy, insolvency, reorganization and moratorium laws and other laws
relating to or affecting the enforcement of creditors' rights generally, to
general equitable principles and to applicable securities laws or
principles of public policy underlying such laws with regard to rights to
indemnity and contribution.
(xvii) The Registration Statement and the Prospectus and each
amendment or supplement thereto (other than the financial statements and
related schedules therein, as to which such counsel need express no
opinion), as of their respective effective or issue dates, complied as to
form in all material respects with the requirements of the Act and the
rules and regulations thereunder. The descriptions in the Registration
Statement and the Prospectus of statutes, legal and governmental
proceedings or contracts and other documents are accurate in all material
respects and fairly present the information required to be shown; and such
counsel do not know of any contracts or documents of a character required
to be described in the Registration Statement or Prospectus or to be filed
as exhibits to the Registration Statement which are not described and filed
as required.
(xviii) The Registration Statement is effective under the Act;
any required filing of the Prospectus pursuant to Rule 424(b) has been made
in the manner and within the time period required by Rule 424(b); and no
stop order suspending the effectiveness of the Registration Statement or
any part thereof has been issued and no proceedings for that purpose have
been instituted or threatened or, to such counsel's knowledge, are
contemplated by the Commission.
(xix) The Company is not, and will not be as a result of the
consummation of the transactions contemplated by this Agreement, an
"investment company," or a company "controlled" by an "investment company,"
within the meaning of the Investment Company Act of 1940, as amended.
Such counsel shall also state that they have no reason to believe (i)
that the Registration Statement, or any further amendment thereto made prior
to such Time of Delivery, on its effective date and as of such Time of
Delivery, contained or contains any untrue statement of a material fact or
omitted or omits to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, or (ii) that the
Prospectus, or any amendment or supplement thereto made prior to such Time of
Delivery, as of its issue date and as of such Time of Delivery, contained or
contains any untrue statement of a material fact or omitted or omits to state
a material fact necessary in order to make the statements therein, in light of
24
the circumstances under which they were made, not misleading (provided that
such counsel need express no belief regarding the financial statements, notes
and related schedules and other financial or statistical data contained in
the Registration Statement, any amendment thereto, or the Prospectus, or any
amendment or supplement thereto).
In rendering any such opinion, such counsel may rely, as to matters of
fact, to the extent such counsel deem proper, on certificates of responsible
officers of the Company and public officials.
(d) You shall have received from BDO Xxxxxxx, LLP letters dated,
respectively, the date hereof and each Time of Delivery, in form and
substance satisfactory to you, stating that they are independent public
accountants with respect to the Company within the meaning of the Act and the
applicable published rules and regulations thereunder, and to the effect that:
(i) In their opinion, the financial statements and schedules audited
by them and included in the Registration Statement comply as to form in all
material respects with the applicable accounting requirements of the Act
and the published rules and regulations thereunder with respect to
registration statements on Form S-1. With respect to the six-month periods
ended June 30, 1997 and June 30, 1996, we have performed the procedures
specified by the American Institute of Certified Public Accountants for a
review of interim financial information as described in SAS No. 71, Interim
Financial Information, on the unaudited condensed balance sheet as of June
30, 1997 and June 30, 1996 and the unaudited condensed statements of
operations and retained earnings and statements of cash flows for the
six-month periods ended June 30, 1997 and June 30, 1996 included in the
Registration Statement;
(ii) The unaudited summary and selected financial information included
in the Preliminary Prospectus and the Prospectus under the captions
"Prospectus Summary" and "Selected Financial Data" agrees with the
corresponding amounts in the audited financial statements included in the
Prospectus or previously reported on by them;
(iii) On the basis of a reading of the latest available unaudited
interim financial statements of the Company and its subsidiaries, a reading
of the minute books of the Company and its subsidiaries, inquiries of
officials of the Company and its subsidiaries responsible for financial and
accounting matters and other specified procedures, all of which have been
agreed to by the Representatives, nothing came to their attention that
caused them to believe that:
25
(A) the unaudited financial statements described in paragraph (i)
above and included in the Registration Statement do not comply as to form
in all material respects with the accounting requirements of the Act and
the related published rules and regulations thereunder and any material
modifications should be made to such unaudited financial statements for
them to be in conformity with generally accepted accounting principles;
(B) at a specified date not more than five days prior to the date of
delivery of such respective letter, there was any change in the capital
stock, decline in stockholders' equity or increase in long-term debt of the
Company or its subsidiaries, or other items specified by the Underwriters,
in each case as compared with amounts shown in the latest balance sheets
included in the Prospectus, except in each case for changes, decreases or
increases which the Prospectus discloses have occurred or may occur or
which are described in such letters; and
(C) for the period from the closing date of the latest statements of
revenues and expenses included in the Prospectus to a specified date not
more than five days prior to the date of delivery of such respective
letter, there were any decreases in revenues or net income of the Company,
or other items specified by the Underwriters, or any increases in any items
specified by the Underwriters, in each case as compared with the
corresponding period of the preceding year, except in each case for
decreases which the Prospectus discloses have occurred or may occur or
which are described in such letter.
(iv) They have carried out certain specified procedures, not
constituting an audit, with respect to certain amounts, percentages and
financial information specified by you which are derived from the general
accounting records of the Company and its subsidiaries, which appear in the
Prospectus and have compared and agreed such amounts, percentages and
financial information with the accounting records of the Company and its
subsidiaries or to analyses and schedules prepared by the Company from its
detailed accounting records.
In the event that the letters to be delivered referred to above set
forth any such changes, decreases or increases, it shall be a further
condition to the obligations of the Underwriters that the Underwriters
shall have determined, after discussions with officers of the Company
responsible for financial and accounting matters and with BDO Xxxxxxx, LLP,
that such changes, decreases or increases as are set forth in such letters
do not reflect a material adverse change in the stockholder's equity or
long-term debt of the Company and its subsidiaries as compared with the
amounts shown in the latest consolidated balance sheets of the Company
included in the Prospectus, or a material adverse change in revenues or
26
net income of the Company, in each case as compared with the corresponding
period of the prior year.
(e) Since the date of the latest audited financial statements
included in the Prospectus, neither the Company nor any of its subsidiaries
shall have sustained (i) any loss or interference with their respective
business from fire, explosion, flood, hurricane 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 disclosed in or contemplated by
the Prospectus, or (ii) any change, or any development involving a
prospective change (including without limitation a change in management or
control of the Company), in or affecting the position (financial or
otherwise), results of operations, net worth or business prospects of the
Company and its subsidiaries, otherwise than as disclosed in or contemplated
by the Prospectus, the effect of which, in either such case, is in your
reasonable judgment so material and adverse as to make it impracticable or
inadvisable to proceed with the purchase, sale and delivery of the Shares
being delivered at such Time of Delivery as contemplated by the Registration
Statement, as amended as of the date hereof.
(f) The Shares shall be listed on the Nasdaq National Market,
subject to notice of issuance.
(g) Subsequent to the date hereof there shall not have occurred any
of the following: (i) any suspension or limitation in trading in securities
generally on the New York Stock Exchange, or any setting of minimum prices
for trading on such exchange, or in the Common Stock by the Commission or the
NASD or the Nasdaq National Market; (ii) a moratorium on commercial banking
activities in New York declared by either federal or state authorities; or
(iii) any outbreak or escalation of hostilities involving the United States,
declaration by the United States of a national emergency or war or any other
national or international calamity or emergency if the effect of any such
event specified in this clause (iii) in your reasonable judgment makes it
impracticable or inadvisable to proceed with the purchase, sale and delivery
of the Shares being delivered at such Time of Delivery as contemplated by the
Registration Statement, as amended as of the date hereof.
(h) The Company shall have furnished to you at such Time of
Delivery certificates of officers of the Company satisfactory to you as to
the accuracy of the representations and warranties of the Company herein at
and as of such Time of Delivery, as to the performance by the Company of all
of its respective obligations hereunder to be performed at or prior to such
Time of Delivery and as to such other matters as you may reasonably request,
and the Company shall have furnished or caused to be furnished certificates
as to the matters set forth in subsections (a) and (f) of this Section 7, and
as to such other matters as you may reasonably request.
8. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter against any losses, claims,
damages or liabilities, joint or several, to which such Underwriter may
27
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: (i) any untrue statement or alleged untrue statement made by the
Company in Section l(a) of this Agreement; (ii) any untrue statement or
alleged untrue statement of any material fact contained in (A) the
Registration Statement or any amendment thereto, any Preliminary Prospectus
or the Prospectus or any amendment or supplement thereto, or (B) any
application or other document, or any amendment or supplement thereto,
executed by the Company or based upon written information furnished by or on
behalf of the Company filed in any jurisdiction in order to qualify the
Shares under the securities or blue sky laws thereof or filed with the
Commission or any securities association or securities exchange (each an
"Application"); (iii) the omission or alleged omission to state in the
Registration Statement or any amendment thereto, any Preliminary Prospectus,
the Prospectus or any amendment or supplement thereto, or any Application a
material fact required to be stated therein or necessary to make the
statements therein not misleading, or (iv) any failure of the Company to
perform its obligations hereunder or under law, and will reimburse each
Underwriter for any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating, defending against or appearing
as a third-party witness in connection with any such loss, claim, damage,
liability or action; 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 or omission or alleged omission made in the Registration
Statement or any amendment thereto, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto or any Application in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through you expressly for use therein. The
Company will not, without the prior written consent of each Underwriter,
settle or compromise or consent to the entry of any judgment in any pending
or threatened claim, action, suit or proceeding (or related cause of action
or portion thereof) in respect of which indemnification may be sought
hereunder (whether or not such Underwriter is a party to such claim, action,
suit or proceeding), unless such settlement, compromise or consent includes
an unconditional release of such Underwriter from all liability arising out
of such claim, action, suit or proceeding (or related cause of action or
portion thereof).
(b) Each Stockholder who receives any portion of the S Corporation
Distribution, as such term is defined in the Registration Statement, jointly
and severally agrees to indemnify and hold harmless each Underwriter against
any losses, claims, damages or liabilities, joint or several, to which such
Underwriter may become subject, under the Act or otherwise, 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 the Registration Statement or any amendment
thereto, or any amendment or supplement thereto, or any Application, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
and will reimburse each Underwriter for any legal or other expenses reasonably
28
incurred by such Underwriter in connection with investigating, defending
against or appearing as a third-party witness in connection with any such
loss, claim, damage, liability or action; provided, however, that each
Stockholder shall not be liable in any such case to the extent that any such
loss, claim, damage, liability or action arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made in the Registration Statement or any amendment thereto, any Preliminary
Prospectus, the Prospectus or any amendment or supplement thereto or any
Application in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through you expressly for use
therein; and provided further, however, that in no event shall the liability
of each Stockholder under this Section 8(b) exceed the amount of the net
proceeds of the offering of the Shares that is used by the Company to pay, or
to repay indebtedness of the Company that is incurred to pay, the S
Corporation Distribution attributable to such Stockholder. Each Stockholder
will not, without the prior written consent of each Underwriter, settle or
compromise or consent to the entry of any judgment in any pending or
threatened claim, action, suit or proceeding (or related cause of action or
portion thereof) in respect of which indemnification may be sought hereunder
(whether or not such Underwriter is a party to such claim, action, suit or
proceeding), unless such settlement, compromise or consent includes an
unconditional release of such Underwriter from all liability arising out of
such claim, action, suit or proceeding (or related cause of action or portion
thereof).
(c) Each Underwriter, severally but not jointly, agrees to
indemnify and hold harmless the Company against any losses, claims, damages
or liabilities to which 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 the Registration
Statement or any amendment thereto, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto, or any Application or
arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only
to the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in conformity with
written information furnished to the Company by such Underwriter through you
expressly for use therein; and will reimburse the Company for any legal or
other expenses reasonably incurred by the Company in connection with
investigating or defending any such loss, claim, damage, liability or action.
(d) Promptly after receipt by an indemnified party under subsection
(a), (b) or (c) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under such subsection, notify the indemnifying party
in writing of the commencement thereof; but the omission so to notify the
indemnifying party, unless and to the extent such omission results in the
forfeiture by the indemnifying party of substantial rights and defenses,
shall not relieve it from any liability which it may have to any indemnified
29
party otherwise than under such subsection. In case any such action shall be
brought against any indemnified party and it shall notify the indemnifying
party of the commencement thereof, the indemnifying party shall be entitled
to participate therein and, to the extent that it shall wish, jointly with
any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the
indemnifying party); provided, however, that if the defendants in any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be one or
more legal defenses available to it or other indemnified parties which are
different from or additional to those available to the indemnifying party,
the indemnifying party shall not have the right to assume the defense of such
action on behalf of such indemnified party and such indemnified party shall
have the right to select separate counsel to defend such action on behalf of
such indemnified party. After such notice from the indemnifying party to
such indemnified party of its election so to assume the defense thereof and
approval by such indemnified party of counsel appointed to defend such
action, the indemnifying party will not be liable to such indemnified party
under this Section 8 for any legal or other expenses, other than reasonable
costs of investigation, subsequently incurred by such indemnified party in
connection with the defense thereof, unless (i) the indemnified party shall
have employed separate counsel in accordance with the proviso to the next
preceding sentence or (ii) the indemnifying party has authorized the
employment of counsel for the indemnified party at the expense of the
indemnifying party. Nothing in this Section 8(d) shall preclude an
indemnified party from participating at its own expense in the defense of any
such action so assumed by the indemnifying party.
(e) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a), (b) or (c) 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 such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to
reflect the relative benefits received by the Company and each Stockholder on
the one hand and the Underwriters on the other from the offering of the
Shares. If, however, the allocation provided by the immediately preceding
sentence is not permitted by applicable law or if the indemnified party
failed to give the notice required under subsection (d) above, then each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only
such relative benefits but also the relative fault of the Company and each
Stockholder on the one hand and the Underwriters on the other in connection
with the statements or omissions that resulted in such losses, claims,
damages or liabilities (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative benefits received by the
Company and each Stockholder 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 each
30
Stockholder (in the case of each Stockholder, such amount consisting of the
net proceeds of the offering that are used by the Company to pay, or to repay
indebtedness of the Company that is incurred to pay, the S Corporation
Distribution to each Stockholder) 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 on the
one hand or the Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company, the Stockholders and the Underwriters
agree that it would not be just and equitable if contributions pursuant to
this subsection (e) were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable
considerations referred to above in this subsection (e). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this
subsection (e) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (e), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at
which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages 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 (e) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(f) The obligations of the Company and the Stockholders under this
Section 8 shall be in addition to any liability which the Company or such
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 8 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 officer and director of the Company and to each
Stockholder and to each person, if any, who controls the Company within the
meaning of the Act.
9. Default of Underwriters. (a) If any Underwriter defaults in its
obligation to purchase Shares at a Time of Delivery, you may in your
discretion arrange for you or another party or other parties to purchase such
Shares on the terms contained herein. If within thirty-six (36) hours after
such default by any Underwriter you do not arrange for the purchase of such
Shares, the Company shall be entitled to a further period of thirty-six (36)
31
hours within which to procure another party or other parties satisfactory to
you to purchase such Shares on such terms. In the event that, within the
respective prescribed periods, you notify the Company that you have so
arranged for the purchase of such Shares, or the Company notifies you that
they have so arranged for the purchase of such Shares, you or the Company
shall have the right to postpone a Time of Delivery for a period of not more
than seven days in order to effect whatever changes may thereby be made
necessary in the Registration Statement or the Prospectus, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments to the Registration Statement or the Prospectus that in your
opinion may thereby be made necessary. The cost of preparing, printing and
filing any such amendments shall be paid for by the Underwriters. The term
"Underwriter" as used in this Agreement shall include any person substituted
under this Section with like effect as if such person had originally been a
party to this Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of
the Shares of a defaulting Underwriter or Underwriters by you and the Company
as provided in subsection (a) above, the aggregate number of such Shares
which remains unpurchased does not exceed one-eleventh of the aggregate
number of Shares to be purchased at such Time of Delivery, then the Company
shall have the right to require each non-defaulting Underwriter to purchase
the number of Shares which such Underwriter agreed to purchase hereunder at
such Time of Delivery and, in addition, to require each non-defaulting
Underwriter to purchase its pro rata share (based on the number of Shares
which such Underwriter agreed to purchase hereunder) of the Shares of such
defaulting Underwriter or Underwriters for which such arrangements have not
been made, but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
10. Termination. (a) This Agreement may be terminated with respect to
the Firm Shares or any Optional Shares in the sole discretion of the
Representatives by notice to the Company given prior to the First Time of
Delivery or any Subsequent Time of Delivery, respectively, in the event that
(i) any condition to the obligations of the Underwriters set forth in Section
7 hereof has not been satisfied in all material respects, or (ii) the Company
shall have failed, refused or been unable to deliver the Shares or to perform
all obligations and satisfy all conditions to be performed or satisfied
hereunder at or prior to such Time of Delivery, in either case other than by
reason of a default by any of the Underwriters. If this Agreement is
terminated pursuant to this Section 10(a), the Company will reimburse the
Underwriters severally upon demand for all out-of-pocket expenses (including
reasonable counsel fees and disbursements) that shall have been incurred by
them in connection with the proposed purchase and sale of the Shares. The
Company shall not in any event be liable to any of the Underwriters for the
loss of anticipated profits from the transactions covered by this Agreement.
(b) If, after giving effect to any arrangements for the purchase of
the Shares of a defaulting Underwriter or Underwriters by you and the Company
as provided in Section 9(a), the aggregate number of such Shares which remains
32
unpurchased exceeds one-eleventh of the aggregate number of Shares to be
purchased at such Time of Delivery, or if the Company shall not exercise the
right described in Section 9(b) to require non-defaulting Underwriters to
purchase Shares of a defaulting Underwriter or Underwriters, then this
Agreement (or, with respect to a Subsequent Time of Delivery, the obligations
of the Underwriters to purchase and of the Company to sell the Optional
Shares) shall thereupon terminate, without liability on the part of any
non-defaulting Underwriter or the Company, except for the expenses to be
borne by the Company and the Underwriters as provided in Section 6 hereof and
the indemnity and contribution agreements in Section 8 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for its default.
11. Survival. The respective indemnities, agreements, representations,
warranties and other statements of the Company, its officers, the
Stockholders and the several Underwriters, as set forth in this Agreement or
made by or on behalf of them, respectively, pursuant to this Agreement, shall
remain in full force and effect, regardless of any investigation (or any
statement as to the results thereof) made by or on behalf of any Underwriter
or any controlling person referred to in Section 8(e) or the Company, any
Stockholder or any officer or director or controlling person of the Company
or any Stockholder referred to in Section 8(e), and shall survive delivery of
and payment for the Shares. The respective agreements, covenants,
indemnities and other statements set forth in Sections 6 and 8 hereof shall
remain in full force and effect, regardless of any termination or
cancellation of this Agreement.
12. Notices. All communications hereunder shall be in writing and, if
sent to any of the Underwriters, shall be mailed, delivered or sent by
facsimile transmission and confirmed in writing to you in care of The
Xxxxxxxx-Xxxxxxxx Company, LLC, 0000 Xxxxxxxxx Xxxx, X.X., Xxxxxxx, Xxxxxxx
00000, Attention: Corporate Finance Department (with a copy to Xxxxxx & Bird
LLP, One Atlantic Center, 0000 Xxxx Xxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx
00000-0000, Attention: Xxxx X. Xxxxxx); if sent to the Company, shall be
mailed, delivered or sent by facsimile transmission and confirmed in writing
to the Company at I.C. Xxxxxx & Company, Inc., 0000 Xxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxx 00000-0000, Attention: President (with a copy to Piper & Marbury
L.L.P., 00 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, Attention: Xxxx
X. Xxxxxxxxxxxx); and if sent to any Stockholder, shall be mailed, delivered
or sent by facsimile transmission and confirmed in writing in care of either
Xxxxxx X. Xxxxx or Xxxxxx X. Xxxx, at I.C. Xxxxxx & Company, Inc., 0000 Xxxx
Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000-0000 (with a copy to Piper & Marbury
L.L.P., 00 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, Attention: Xxxx
X. Xxxxxxxxxxxx).
13. Representatives. You will act for the several Underwriters in
connection with the transactions contemplated by this Agreement, and any
action under this Agreement taken by you jointly or by The Xxxxxxxx-Xxxxxxxx
33
Company, LLC will be binding upon all the Underwriters.
14. Binding Effect. This Agreement shall be binding upon, and inure
solely to the benefit of, the Underwriters and the Company and to the extent
provided in Sections 8 and 10 hereof, the Stockholders, officers and
directors and controlling persons referred to therein and their respective
heirs, executors, administrators, successors and assigns, and no other person
shall acquire or have any right under or by virtue of this Agreement. No
purchaser of any of the Shares from any Underwriter shall be deemed a
successor or assign by reason merely of such purchase.
15. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Georgia without giving effect to any
provisions regarding conflicts of laws.
16. Counterparts. This Agreement may be executed by any one or more of
the parties hereto 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 instrument.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us one of the counterparts hereof, and
upon the acceptance hereof by The Xxxxxxxx-Xxxxxxxx Company, LLC, on behalf
of each of the Underwriters, this letter will constitute a binding agreement
among the Underwriters and the Company. It is understood that your
acceptance of this letter on behalf of each of the Underwriters is pursuant
to the authority set forth in the Master Agreement among Underwriters, a copy
of which shall be submitted to the Company for examination upon request, but
without warranty on your part as to the authority of the signers thereof.
Very truly yours,
I.C. XXXXXX & COMPANY, INC.
By:_________________________________
Name: Xxxxxx X. Xxxx
Title: President and Co-Chief Executive
Officer
By:_________________________________
Name: Xxxxxx X. Xxxxx
Title: Chariman of the Board and
Co-Chief Executive Officer
[SIGNATURES CONTINUED ON NEXT PAGE]
34
STOCKHOLDERS
____________________________________
Xxx Xxxxxxx
____________________________________
Xxxxxx X. Xxxxx
____________________________________
Xxxxxx X. Xxxx
____________________________________
Xxx Xxxxxxx
____________________________________
Xxxxxxx Xxxxxx
____________________________________
Xxxx X. Xxxxxxxx
____________________________________
Xxxxxx X. Xxxxxxxxx
____________________________________
Xxxxxx Xxxxx
____________________________________
Xxxxxx X. Xxxxxxx
[SIGNATURES CONTINUED ON NEXT PAGE]
35
____________________________________
Xxxxx Xxxxxxx
____________________________________
Xxxxxxx Xxxxx
____________________________________
Xxxxxx Xxxxxxxx
____________________________________
Xxx Xxxxxxxx
____________________________________
Xxxxxxx Xxxxxxx
____________________________________
Xxxxx Xxxxxxx
____________________________________
Xxxxxx Xxxxxxx
____________________________________
Xxxxxxx Xxxxxxx
____________________________________
Xxxxx Xxxxxxxx
____________________________________
Xxxxxx Xxxxxxx
[SIGNATURES CONTINUED ON NEXT PAGE]
36
____________________________________
Xxxxxxx Xxxxxxxx
____________________________________
Xxxxxx Xxxxx
____________________________________
Xxxxxx Xxxxxx
____________________________________
Xxxxxxx Xxxxxxxx
____________________________________
Xxxxxxx Xxxxxxx
____________________________________
Xxxxx Xxxx
The foregoing Agreement is hereby
confirmed and accepted as of the date first
written above at Atlanta, Georgia.
THE XXXXXXXX-XXXXXXXX COMPANY, LLC
XXXX XXXXX XXXX XXXXXX, INCORPORATED
By: The Xxxxxxxx-Xxxxxxxx Company, LLC
By:_________________________________
(Authorized Representative)
On behalf of each of the Underwriters
37
SCHEDULE I
Number of
Optional Shares
Total Number of to be Purchased
Firm Shares to be if Maximum
Underwriter Purchased Option Exercised
----------------------------- ----------------- ------------------
The Xxxxxxxx-Xxxxxxxx Company, LLC
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated
Total
38
