1
Exhibit 1.1
3,000,000 Shares
INTERWORLD CORPORATION
Common Stock
($.01 par value)
UNDERWRITING AGREEMENT
__________, 1999
INVEMED ASSOCIATES, LLC
000 Xxxx Xxxxxx
Xxx Xxxx, X.X. 00000
Dear Sirs:
1. Introductory. InterWorld Corporation, a Delaware corporation
("Company"), proposes to issue and sell 3,000,000 shares (the "Firm Securities")
of its authorized and unissued Common Stock, $.01 par value ("Common Stock") to
Invemed Associates, LLC (the "Underwriter"). The Company also proposes to issue
and sell to the Underwriter, at the option of the Underwriter, an aggregate of
not more than 450,000 additional shares (the "Optional Securities") of its
Common Stock, as set forth below. The Firm Securities and the Optional
Securities are herein collectively called the "Offered Securities". The Company
hereby agrees with the Underwriter as follows:
2. Representations and Warranties of the Company. The Company represents
and warrants to, and agrees with, the Underwriter that:
(a) A registration statement (No. 333-79879) relating to the Offered
Securities, including a form of prospectus, has been filed with the
Securities and Exchange Commission ("Commission") and either (A) has
been declared effective under the Securities Act of 1933 ("Act") and
is not proposed to be amended or (B) is proposed to be amended by
amendment or post-effective amendment. If such registration
statement (the "initial registration statement") has been declared
effective, either (A) an additional registration statement (the
"additional registration statement") relating to the Offered
Securities may have been filed with the Commission pursuant to Rule
462(b) ("Rule 462(b)") under the Act and, if so filed, has become
effective upon filing pursuant to such Rule and the Offered
Securities all have been duly registered under the Act pursuant to
the initial registration statement and, if applicable, the
additional registration statement or (B) such additional
registration statement is proposed to be filed with the Commission
pursuant to Rule 462(b) and will become effective upon filing
pursuant to such Rule and upon such filing the Offered Securities
will all have been duly registered under the Act pursuant to the
initial registration statement and such additional registration
statement. If the Company does not propose to amend the initial
registration statement or if an additional registration statement
has been filed and the Company does not propose to amend it, and if
any post-effective amendment to either such registration statement
has been filed with the Commission prior to the execution and
delivery of this Agreement, the most recent amendment (if any) to
each such registration statement has been declared effective by the
Commission or has become effective upon filing pursuant to Rule
462(c) ("Rule 462(c)") under the Act or, in the case of the
additional registration statement, Rule 462(b). For purposes of this
Agreement, "Effective Time" with respect to the
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initial registration statement or, if filed prior to the execution
and delivery of this Agreement, the additional registration
statement means (A) if the Company has advised the Underwriter that
it does not propose to amend such registration statement, the date
and time as of which such registration statement, or the most recent
post-effective amendment thereto (if any) filed prior to the
execution and delivery of this Agreement, was declared effective by
the Commission or has become effective upon filing pursuant to Rule
462(c), or (B) if the Company has advised the Underwriter that it
proposes to file an amendment or post-effective amendment to such
registration statement, the date and time as of which such
registration statement, as amended by such amendment or
post-effective amendment, as the case may be, is declared effective
by the Commission. If an additional registration statement has not
been filed prior to the execution and delivery of this Agreement but
the Company has advised the Underwriter that it proposes to file
one, "Effective Time" with respect to such additional registration
statement means the date and time as of which such registration
statement is filed and becomes effective pursuant to Rule 462(b).
"Effective Date" with respect to the initial registration statement
or the additional registration statement (if any) means the date of
the Effective Time thereof. The initial registration statement, as
amended at its Effective Time including all information contained in
the additional registration statement (if any) and deemed to be a
part of the initial registration statement as of the Effective Time
of the additional registration statement pursuant to the General
Instructions of the Form on which it is filed and including all
information (if any) deemed to be a part of the initial registration
statement as of its Effective Time pursuant to Rule 430A(b) ("Rule
430A(b)") under the Act, is hereinafter referred to as the "Initial
Registration Statement". The additional registration statement, as
amended at its Effective Time, including the contents of the initial
registration statement incorporated by reference therein and
including all information (if any) deemed to be a part of the
additional registration statement as of its Effective Time pursuant
to Rule 430A(b), is hereinafter referred to as the "Additional
Registration Statement". The Initial Registration Statement and the
Additional Registration Statement are hereinafter referred to
collectively as the "Registration Statements" and individually as a
"Registration Statement". The form of prospectus relating to the
Offered Securities, as first filed with the Commission pursuant to
and in accordance with Rule 424(b) ("Rule 424(b)") under the Act or
(if no such filing is required) as included in a Registration
Statement is hereinafter referred to as the "Prospectus". No
document has been or will be prepared or distributed in reliance on
Rule 434 under the Act.
(b) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement: (A) on the
Effective Date of the Initial Registration Statement, the Initial
Registration Statement conformed in all respects to the requirements
of the Act and the rules and regulations of the Commission ("Rules
and Regulations") and did not include any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading, (B) on the Effective Date of the Additional Registration
Statement (if any), each Registration Statement conformed or will
conform, in all respects to the requirements of the Act and the
Rules and Regulations and did not include, or will not include, any
untrue statement of a material fact and did not omit, or will not
omit, to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and (C) on
the date of this Agreement, the Initial Registration Statement and,
if the Effective Time of the Additional Registration Statement is
prior to the execution and delivery of this Agreement, the
Additional Registration Statement each conforms, and at the time of
filing of the Prospectus pursuant to Rule 424(b) or (if no such
filing is required) at the Effective Date of the Additional
Registration Statement in which the Prospectus is included, each
Registration Statement and the Prospectus will conform, in all
respects to the requirements of the Act and the Rules and
Regulations, and neither of such documents includes, or will
include, any untrue statement of a material fact or omits, or will
omit, to state any material fact required to be stated therein or
necessary to make the statements therein not misleading. If the
Effective Time of the Initial Registration Statement is subsequent
to the execution and delivery of this Agreement: on the Effective
Date of the Initial Registration Statement, the Initial Registration
Statement and the Prospectus will conform in all respects to the
requirements of the Act and the Rules and
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Regulations, neither of such documents will include any untrue
statement of a material fact or will omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading, and no Additional Registration Statement has
been or will be filed. The two preceding sentences do not apply to
statements in or omissions from a Registration Statement or the
Prospectus based upon written information furnished to the Company
by the Underwriter specifically for use therein, it being understood
and agreed that the only such information is that described as such
in Section 7(c) hereof.
(c) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of
Delaware, with power and authority (corporate and other) to own or
lease its properties and conduct its business as described in the
Prospectus; and the Company is duly qualified to do business as a
foreign corporation in good standing in all other jurisdictions in
which its ownership or lease of property or the conduct of its
business requires such qualification, except where the failure to be
so qualified would not have a material adverse effect on the
condition (financial or other), businesses, properties or results of
operations of the Company and its subsidiaries taken as a whole
("Matereial Adverse Effect").
(d) Each subsidiary of the Company has been duly incorporated and is
an existing corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority
(corporate and other) to own or lease its properties and conduct its
business as described in the Prospectus; and each subsidiary of the
Company is duly qualified to do business as a foreign corporation in
good standing in all other jurisdictions in which its ownership or
lease of property or the conduct of its business requires such
qualification, except where the failure to be so qualified would not
have a material adverse effect on the Company and its subsidiaries
taken as a whole; all of the issued and outstanding capital stock of
each subsidiary of the Company has been duly authorized and validly
issued and is fully paid and nonassessable and is owned by the
Company, directly or through subsidiaries; and the capital stock of
each subsidiary owned by the Company, directly or through
subsidiaries, is owned free from liens, encumbrances and defects.
(e) All outstanding shares of capital stock of the Company have been
duly authorized and validly issued, and are fully paid and
nonassessable and conform to the description thereof contained in
the Prospectus; and the stockholders of the Company have no
preemptive rights with respect to the Common Stock.
(f) The Offered Securities have been duly authorized, and when
issued, delivered and paid for pursuant to this Agreement, will be
validly issued, fully paid and non-assessable, and will conform to
the description thereof contained in the Prospectus.
(g) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person that
would give rise to a valid claim against the Company or the
Underwriter for a brokerage commission, finder's fee or other like
payment in connection with this offering.
(h) Except for the Registration Rights Agreement dated March 7,
1996, as amended, between the Company and the holders of Series A
Preferred Stock, there are no contracts, agreements or
understandings between the Company and any person granting such
person the right to require the Company to file a registration
statement under the Act with respect to any securities of the
Company owned or to be owned by such person or to require the
Company to include such securities in the securities registered
pursuant to a Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Act. No person has any registration rights with
respect to the registration statement covering the Offered
Securities.
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(i) The Common Stock have been approved for quotation subject to
notice of issuance on the Nasdaq National Market.
(j) No consent, approval, authorization, or order of, or filing
with, any governmental agency or body or any court is required to be
obtained or made by the Company for the consummation of the
transactions contemplated by this Agreement in connection with the
sale of the Offered Securities, except such as have been obtained
and made under the Act and such as may be required under state
securities laws.
(k) The execution, delivery and performance of this Agreement, and
the consummation of the transactions herein contemplated will not
result in a breach or violation of any of the terms and provisions
of, or constitute a default under, (i) the charter or by-laws of the
Company or any such subsidiary of the Company, (ii) any agreement or
instrument to which the Company or any such subsidiary is a party or
by which the Company or any such subsidiary is bound or to which any
of the properties of the Company or any such subsidiary is subject,
except for any such breaches or defaults which, individually or in
the aggregate, would not have a Material Adverse Effect, or (iii)
any statute, any rule, regulation or order of any governmental
agency or body or any court, domestic or foreign, having
jurisdiction over the Company or any subsidiary of the Company or
any of their properties.
(l) This Agreement has been duly authorized, executed and delivered
by the Company.
(m) Except as disclosed in the Prospectus, the Company and its
subsidiaries have good and marketable title to all real properties
and all other properties and assets owned by them, in each case free
from liens, encumbrances and defects that would materially affect
the value thereof or materially interfere with the use made or to be
made thereof by them; and except as disclosed in the Prospectus, the
Company and its subsidiaries hold any leased real or personal
property under valid and enforceable leases with no exceptions that
would materially interfere with the use made or to be made thereof
by them, except as enforcement thereof may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting creditors' rising generally or by
general equitable principles.
(n) The Company and its subsidiaries possess adequate certificates,
authorities or permits issued by appropriate governmental agencies
or bodies necessary to conduct the business now operated by them and
have not received any notice of proceedings relating to the
revocation or modification of any such certificate, authority or
permit that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a Material
Adverse Effect.
(o) No labor dispute with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent
that could reasonably be expected to have a Material Adverse Effect.
(p) The Company and its subsidiaries own, license, possess or can
acquire on reasonable terms, adequate trademarks, trade names and
other rights to inventions, know-how, patents, copyrights,
confidential information and other intellectual property
(collectively, "intellectual property rights") necessary to conduct
the business now operated by them, or presently employed by them,
and have not received any notice of infringement of or conflict with
asserted rights of others with respect to any intellectual property
rights that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a Material
Adverse Effect.
(q) Except as disclosed in the Prospectus, neither the Company nor
any of its subsidiaries is in violation of any statute, any rule,
regulation, decision or order of any governmental agency or body or
any court, domestic or foreign, relating to the use, disposal or
release of hazardous or
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toxic substances or relating to the protection or restoration of the
environment or human exposure to hazardous or toxic substances
(collectively, "environmental laws"), owns or operates any real
property contaminated with any substance that is subject to any
environmental laws, is liable for any off-site disposal or
contamination pursuant to any environmental laws, or is subject to
any claim relating to environmental laws, which violation,
contamination, liability or claim would individually or in the
aggregate have a Material Adverse Effect; and the Company is not
aware of any pending investigation which might lead to such a claim.
(r) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Company, any
of its subsidiaries or any of their respective properties that, if
determined adversely to the Company or any of its subsidiaries,
would individually or in the aggregate have a Material Adverse
Effect, or would materially and adversely affect the ability of the
Company to perform its obligations under this Agreement, or which
are otherwise material in the context of the sale of the Offered
Securities; and no such actions, suits or proceedings are threatened
or to the Company's knowledge, contemplated.
(s) The financial statements included in each Registration Statement
and the Prospectus present fairly the financial position of the
Company and its consolidated subsidiaries as of the dates shown and
their results of operations and cash flows for the periods shown,
and such financial statements have been prepared in conformity with
the generally accepted accounting principles in the United States
applied on a consistent basis, and the schedules included in each
Registration Statement present fairly the information required to be
stated therein.
(t) Except as disclosed in the Prospectus, since the date of the
latest audited financial statements included in the Prospectus there
has been no material adverse change, nor any development or event
involving a prospective material adverse change, in the condition
(financial or other), business, properties or results of operations
of the Company and its subsidiaries taken as a whole, and, except as
disclosed in or contemplated by the Prospectus, there has been no
dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(u) The Company is not and, after giving effect to the offering and
sale of the Offered Securities and the application of the proceeds
thereof as described in the Prospectus, will not be an "investment
company" as defined in the Investment Company Act of 1940.
(v) Neither the Company nor any of its affiliates does business with
the government of Cuba or with any person or affiliate located in
Cuba within the meaning of Section 517.075, Florida Statutes, and
the Company agrees to comply with such Section if prior to the
completion of the distribution of the Offered Securities it
commences doing such business.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company agrees to sell to the
Underwriter, and the Underwriter agrees to purchase from the Company, at a
purchase price of $______________ per share, the Firm Securities.
The Company will deliver the Firm Securities to you, against payment of
the purchase price in Federal (same day) funds by official bank check or checks
or wire transfer to an account at a bank acceptable to the Underwriter drawn to
the order of the Company at the office of Xxxxxx, Xxxxx & Xxxxxxx LLP, 000 Xxxx
Xxxxxx, Xxx Xxxx, XX 00000, at 10:00 A.M., New York time, on_______________ ,
1999, or at such other time not later than seven full business days thereafter
as the Underwriter and the Company determine, such time being herein referred to
as the "First Closing Date." The certificates for the Firm Securities so to be
delivered will be in definitive form, in such denominations and registered in
such names as the Underwriter requests and will be made available for checking
and packaging at the above office of Xxxxxx, Xxxxx & Bockius LLP at least 24
hours prior to
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the First Closing Date. If the Underwriter so elects, delivery of Firm
Securities may be made by credit through full fast transfer to the accounts at
the Depository Trust Company designated by the Underwriter.
In addition, upon written notice from the Underwriter given to the Company
from time to time not more than 30 days subsequent to the date of the
Prospectus, the Underwriter may purchase all or less than all of the Optional
Securities at the purchase price per share to be paid for the Firm Securities.
The Company agrees to sell to the Underwriter the number of shares of Optional
Securities specified in such notice and the Underwriter agrees to purchase such
Optional Securities. Such Optional Securities shall be purchased from the
Company by the Underwriter only for the purpose of covering over-allotments made
in connection with the sale of the Firm Securities. No Optional Securities shall
be sold or delivered unless the Firm Securities previously have been, or
simultaneously are, sold and delivered. The right to purchase the Optional
Securities or any portion thereof may be exercised from time to time and to the
extent not previously exercised may be surrendered and terminated at any time
upon notice by the Underwriter to the Company.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "Optional Closing Date", which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "Closing Date"), shall be determined by the
Underwriter but shall be not less than two full business days nor later than
five full business days after written notice of election to purchase Optional
Securities is given. The Company will deliver the Optional Securities being
purchased on each Optional Closing Date to the Underwriter, against payment of
the purchase price therefor in Federal (same day) funds by official bank check
or checks or wire transfer to an account at a bank acceptable to the Underwriter
drawn to the order of the Company at the above office of Xxxxxx, Xxxxx & Xxxxxxx
LLP, 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000. The certificates for the Optional
Securities being purchased on each Optional Closing Date will be in definitive
form, in such denominations and registered in such names as the Underwriter
requests upon reasonable notice prior to such Optional Closing Date and will be
made available for checking and packaging at the above office of Xxxxxx, Xxxxx &
Bockius LLP at a reasonable time in advance of such Optional Closing Date. If
the Underwriter so elects, delivery of Optional Securities may be made by credit
through full fast transfer to the account at the Depository Trust Company
designated by the Underwriter.
4. Offering by Underwriter. It is understood that the Underwriter proposes
to offer the Offered Securities for sale to the public as set forth in the
Prospectus.
5. Certain Agreements of the Company. The Company agrees with the
Underwriter that:
(a) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement, the Company
will file the Prospectus with the Commission pursuant to and in
accordance with subparagraph (1) (or, if applicable and if consented
to by the Underwriter, subparagraph (4)) of Rule 424(b) not later
than the earlier of (A) the second business day following the
execution and delivery of this Agreement or (B) the fifteenth
business day after the Effective Date of the Initial Registration
Statement. The Company will advise the Underwriter promptly of any
such filing pursuant to Rule 424(b). If the Effective Time of the
Initial Registration Statement is prior to the execution and
delivery of this Agreement and an additional registration statement
is necessary to register a portion of the Offered Securities under
the Act but the Effective Time thereof has not occurred as of such
execution and delivery, the Company will file the additional
registration statement or, if filed, will file a post-effective
amendment thereto with the Commission pursuant to and in accordance
with Rule 462(b) on or prior to 10:00 P.M., New York time, on the
date of this Agreement or, if earlier, on or prior to the time the
Prospectus is printed and distributed to the Underwriter, or will
make such filing at such later date as shall have been consented to
by the Underwriter.
(b) The Company will advise the Underwriter promptly of any proposal
to amend or supplement the initial or any additional registration
statement as filed or the related prospectus or the Initial
Registration Statement, the Additional Registration Statement (if
any) or the Prospectus and will not effect such amendment or
supplementation without the Underwriter's consent; and
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the Company will also advise the Underwriter promptly of the
effectiveness of each Registration Statement (if its Effective Time
is subsequent to the execution and delivery of this Agreement) and
of any amendment or supplementation of a Registration Statement or
the Prospectus and of the institution by the Commission of any stop
order proceedings in respect of a Registration Statement and will
use its best efforts to prevent the issuance of any such stop order
and to obtain as soon as possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection
with sales by the Underwriter or dealer, any event occurs as a
result of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, or
if it is necessary at any time to amend the Prospectus to comply
with the Act, the Company will promptly notify the Underwriter of
such event and will promptly prepare and file with the Commission,
at its own expense, an amendment or supplement which will correct
such statement or omission or an amendment which will effect such
compliance. Neither the Underwriter's consent to, nor delivery of,
any such amendment or supplement shall constitute a waiver of any of
the conditions set forth in Section 6.
(d) As soon as practicable, but not later than the Availability Date
(as defined below), the Company will make generally available to its
security holders an earnings statement covering a period of at least
12 months beginning after the Effective Date of the Initial
Registration Statement (or, if later, the Effective Date of the
Additional Registration Statement) which will satisfy the provisions
of Section 11(a) of the Act. For the purpose of the preceding
sentence, "Availability Date" means the 45th day after the end of
the fourth fiscal quarter following the fiscal quarter that includes
such Effective Date, except that, if such fourth fiscal quarter is
the last quarter of the Company's fiscal year, "Availability Date"
means the 90th day after the end of such fourth fiscal quarter.
(e) The Company will furnish to the Representatives copies of each
Registration Statement (two of which will be signed and will include
all exhibits), each related preliminary prospectus, and, so long as
a prospectus relating to the Offered Securities is required to be
delivered under the Act in connection with sales by the Underwriter
or dealer, the Prospectus and all amendments and supplements to such
documents, in each case in such quantities as the Underwriter
requests. The Prospectus shall be so furnished on or prior to 3:00
P.M., New York time, on the business day following the later of the
execution and delivery of this Agreement or the Effective Time of
the Initial Registration Statement. All other such documents shall
be so furnished as soon as available. The Company will pay the
expenses of printing and distributing to the Underwriter all such
documents.
(f) The Company will arrange for the qualification of the Offered
Securities for sale under the laws of such jurisdictions as the
Underwriter designates and to continue such qualifications in effect
so long as required for the distribution of the Offered Securities.
(g) During the period 5 years hereafter, the Company will furnish to
the Underwriter, as soon as practicable after the end of each fiscal
year, a copy of its annual report to stockholders for such year; and
the Company will furnish to the Underwriter (i) as soon as
available, a copy of each report and any definitive proxy statement
of the Company filed with the Commission under the Securities
Exchange Act of 1934 or mailed to stockholders, and (ii) from time
to time, such other information concerning the Company as the
Underwriter may reasonably request.
(h) For a period of 180 days after the date of the initial public
offering of the Offered Securities, the Company will not offer,
sell, contract to sell, pledge or otherwise dispose of, directly or
indirectly, or file with the Commission a registration statement
under the Act relating
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to, any additional shares of its Common Stock or securities or other
rights convertible into or exchangeable or exercisable for any
shares of its Common Stock, or publicly disclose the intention to
make any such offer, sale, pledge, disposition or filing, without
the prior written consent of the Underwriter, except issuances of
Common Stock pursuant to the conversion or exchange of convertible
or exchangeable securities or the exercise of warrants in each case
outstanding on the date hereof, grants of employee stock options
pursuant to the terms of the Company's Amended and Restated 1996
Stock Option Plan, issuances of Common Stock pursuant to the
exercise of such options as are outstanding on the date hereof or
issuances of Common Stock pursuant to the Company's Employee Stock
Purchase Plan.
(i) The Company agrees with the Underwriter that the Company will
pay all expenses incident to the performance of the obligations of
the Company under this Agreement, for any filing fees and other
expenses (including fees and disbursements of counsel) in connection
with qualification of the Offered Securities for sale under the laws
of such jurisdictions as the Underwriter designates and the printing
of memoranda relating thereto, for the filing fee incident to, and
the reasonable fees and disbursements of counsel to the Underwriter
in connection with the review by the National Association of
Securities Dealers, Inc. of the Offered Securities, for any travel
expenses of the Company's officers and employees and any other
expenses of the Company in connection with attending or hosting
meetings with prospective purchasers of the Offered Securities and
for expenses incurred in distributing preliminary prospectuses and
the Prospectus (including any amendments and supplements thereto) to
the Underwriter.
(j) The Company shall, prior to or concurrently with the execution
of this Agreement, deliver an agreement executed by (i) each of the
directors and officers of the Company and (ii) each other
shareholder of the Company to the effect that such person will not
without the prior written consent of Invemed Associates LLC during
the period commencing on the date such person signs such agreement
and ending 180 days after the date of the Prospectus (i) offer,
sell, contract to sell, pledge, or otherwise dispose of, directly or
indirectly, any shares of Common Stock or any securities or other
rights convertible into or exchangeable or exercisable for any
shares of Common Stock or publicly disclose the intention to make
any such offer, sale, contract to sell, pledge, or disposition, (ii)
enter into any swap or other arrangement that transfers, in whole or
in part, all or a portion of the economic consequences of ownership
of any Common Stock (regardless of whether any of the transactions
described in clause (i) or (ii) is to be settled by the delivery of
Common Stock, or such other securities, in cash or otherwise) or
(iii) make any demand for, or exercise any right with respect to,
the registration of any shares of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock.
6. Conditions of the Obligations of the Underwriter. The obligations of
the Underwriter to purchase and pay for the Firm Securities on the First Closing
Date and the Optional Securities to be purchased on each Optional Closing Date
will be subject to the accuracy of the representations and warranties on the
part of the Company herein, to the accuracy of the statements of Company
officers made pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder and to the following additional conditions
precedent:
(a) The Underwriter shall have received a letter, dated the date of
delivery thereof (which, if the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of
this Agreement, shall be on or prior to the date of this Agreement
or, if the Effective Time of the Initial Registration Statement is
subsequent to the execution and delivery of this Agreement, shall be
prior to the filing of the amendment or post-effective amendment to
the registration statement to be filed shortly prior to such
Effective Time), of PricewaterhouseCoopers LLP confirming that they
are independent public accountants within the meaning of the Act and
the applicable published Rules and Regulations thereunder and
stating to the effect that:
(i) in their opinion the financial statements and schedules
examined by them and included in the Registration Statements
comply as to form in all material respects with
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the applicable accounting requirements of the Act and the
related published Rules and Regulations;
(ii) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a
review of interim financial information as described in
Statement of Auditing Standards No. 71, Interim Financial
Information, on the unaudited financial statements included in
the Registration Statements;
(iii) on the basis of the review referred to in clause (ii)
above, a reading of the latest available interim financial
statements of the Company, inquiries of officials of the
Company who have responsibility for financial and accounting
matters and other specified procedures, nothing came to their
attention that caused them to believe that:
(1) the unaudited financial statements included in the
Registration Statements do not comply as to form in all
material respects with the applicable accounting
requirements of the Act and the related published Rules
and Regulations or any material modifications should be
made to such unaudited financial statements for them to
be in conformity with generally accepted accounting
principles;
(2) at the date of the latest available balance sheet
read by such accountants, or at a subsequent specified
date not more than three business days prior to the date
of this Agreement, there was any change in the capital
stock or any increase in short-term indebtedness or
long-term debt of the Company and its consolidated
subsidiaries or, at the date of the latest available
balance sheet read by such accountants, there was any
decrease in consolidated net current assets or net
assets, as compared with amounts shown on the latest
balance sheet included in the Prospectus; or
(3) for the period from the closing date of the latest
income statement included in the Prospectus to the
closing date of the latest available income statement
read by such accountants there were any decreases, as
compared with the corresponding period of the previous
year and with the period of corresponding length ended
the date of the latest income statement included in the
Prospectus, in consolidated net sales or net operating
income or in the total or per share amounts of
consolidated net income;
(4) except in all cases set forth in clauses (B) and (C)
above for changes, increases or decreases which the
Prospectus discloses have occurred or may occur or which
are described in such letter; and
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other
financial information contained in the Registration Statements
(in each case to the extent that such dollar amounts,
percentages and other financial information are derived from
the general accounting records of the Company and its
subsidiaries subject to the internal controls of the Company's
accounting system or are derived directly from such records by
analysis or computation) with the results obtained from
inquiries, a reading of such general accounting records and
other procedures specified in such letter and have found such
dollar amounts, percentages and other financial information to
be in agreement with such results, except as otherwise
specified in such letter.
For purposes of this subsection, (i) if the Effective
Time of the Initial Registration Statement is subsequent to
the execution and delivery of this Agreement,
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"Registration Statements" shall mean the initial registration
statement as proposed to be amended by the amendment or
post-effective amendment to be filed shortly prior to its
Effective Time, (ii) if the Effective Time of the Initial
Registration Statement is prior to the execution and delivery
of this Agreement but the Effective Time of the Additional
Registration Statement is subsequent to such execution and
delivery, "Registration Statements" shall mean the Initial
Registration Statement and the additional registration
statement as proposed to be filed or as proposed to be amended
by the post-effective amendment to be filed shortly prior to
its Effective Time, and (iii) "Prospectus" shall mean the
prospectus included in the Registration Statements.
(b) The Company shall have received from PricewaterhouseCoopers LLP
(and furnished to the Underwriter) a review report with respect to
Management's Discussion and Analysis of Financial Condition and
Results of Operations of the Company for the fiscal years ending
1996, 1997 and 1998 and for the three-month period ending March 31,
1999, and the corresponding period for the prior fiscal year, each
in accordance with Statement on Standards for Attestation Engagement
No. 8 issued by the Auditing Standards Board of the American
Institute of Certified Public Accountants.
(c) If the Effective Time of the Initial Registration Statement is
not prior to the execution and delivery of this Agreement, such
Effective Time shall have occurred not later than 10:00 P.M., New
York time, on the date of this Agreement or such later date as shall
have been consented to by the Underwriter. If the Effective Time of
the Additional Registration Statement (if any) is not prior to the
execution and delivery of this Agreement, such Effective Time shall
have occurred not later than 10:00 P.M., New York time, on the date
of this Agreement or, if earlier, the time the Prospectus is printed
and distributed to the Underwriter, or shall have occurred at such
later date as shall have been consented to by the Underwriter. If
the Effective Time of the Initial Registration Statement is prior to
the execution and delivery of this Agreement, the Prospectus shall
have been filed with the Commission in accordance with the Rules and
Regulations and Section 5(a) of this Agreement. Prior to such
Closing Date, no stop order suspending the effectiveness of a
Registration Statement shall have been issued and no proceedings for
that purpose shall have been instituted or, to the knowledge of any
Selling Stockholder, the Company or the Underwriter, shall be
contemplated by the Commission.
(d) Subsequent to the execution and delivery of this Agreement,
there shall not have occurred (i) any change, or any development or
event involving a prospective change, in the condition (financial or
other), business, properties or results of operations of the Company
and its subsidiaries taken as a whole which, in the judgment of the
Underwriter, is material and adverse and makes it impractical or
inadvisable to proceed with completion of the public offering or the
sale of and payment for the Offered Securities; (ii) any suspension
or limitation of trading in securities generally on the New York
Stock Exchange, or any setting of minimum prices for trading on such
exchange, or any suspension of trading of any securities of the
Company on any exchange or in the over-the-counter market; (iii) any
banking moratorium declared by U.S. Federal or New York authorities;
or (iv) any outbreak or escalation of major hostilities in which the
United States is involved, any declaration of war by Congress or any
other substantial national or international calamity or emergency
if, in the judgment of the Underwriter, the effect of any such
outbreak, escalation, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the public
offering or the sale of and payment for the Offered Securities.
(e) The Underwriter shall have received an opinion, dated such
Closing Date, of X'Xxxxxxxx, Graev & Karabell, LLP, counsel for the
Company, to the effect that:
(i) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of
Delaware, with corporate power and authority to
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own its properties and conduct its business as described in
the Prospectus; and the Company is duly qualified to do
business as a foreign corporation in good standing in all
other jurisdictions in which its ownership or lease of
property or the conduct of its business requires such
qualification, except where the failure to be so qualified
would not have a material adverse effect on the Company;
(ii) The Offered Securities delivered on such Closing Date
(assuming issuance and delivery against payment therefor in
accordance with the terms hereof) and all other outstanding
shares of the Common Stock of the Company have been duly
authorized and validly issued, are fully paid and
nonassessable and conform to the description thereof contained
in the Prospectus; and the stockholders of the Company have no
statutory preemptive rights or, to such counsel's knowledge,
similar rights with respect to the Common Stock;
(iii) To the best of the knowledge of such counsel, the number
of options and warrants outstanding is as set forth in the
Registration Statement. The grant of such options and the
issuance of such warrants have been duly authorized and such
options and warrants have been validly issued;]
(iv) Except for the Registration Rights Agreement dated March
7, 1996, as amended, between the Company and the holders of
Series A Preferred Stock there are no contracts, agreements or
understandings known to such counsel between the Company and
any person granting such person the right to require the
Company to file a registration statement under the Act with
respect to any securities of the Company owned or to be owned
by such person or to require the Company to include such
securities in the securities registered pursuant to the
Registration Statement or in any securities being registered
pursuant to any other registration statement filed by the
Company under the Act. To such counsel's knowledge no person
has any registration rights with respect to a Registration
Statement covering the Offered Securities;
(v) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required
to be obtained or made by the Company for the consummation of
the transactions contemplated by this Agreement in connection
with the sale of the Offered Securities, except such as have
been obtained and made under the Act and such as may be
required under state securities laws;
(vi) The execution, delivery and performance of this Agreement
and the consummation of the transactions herein contemplated
will not result in a breach or violation of any of the terms
and provisions of, or constitute a default under the charter
or by-laws of the Company or any subsidiary of the Company,
any statute, any rule, regulation or, to such counsel's
knowledge, order of any governmental agency or body or any
court having jurisdiction over the Company or any subsidiary
of the Company or any of their properties, or, to such
counsel's knowledge, any material agreement or instrument to
which the Company or any such subsidiary is a party or by
which the Company or any such subsidiary is bound or to which
any of the properties of the Company or any such subsidiary is
subject;
(vii) The Initial Registration Statement was declared
effective under the Act as of the date and time specified in
such opinion, the Additional Registration Statement (if any)
was filed and became effective under the Act as of the date
and time (if determinable) specified in such opinion, the
Prospectus either was filed with the Commission pursuant to
the subparagraph of Rule 424(b) specified in such opinion on
the date specified therein or was included in the Initial
Registration Statement or the Additional Registration
Statement (as the case may be), and, to the knowledge of such
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counsel, no stop order suspending the effectiveness of a
Registration Statement or any part thereof has been issued and
no proceedings for that purpose have been instituted or are
pending or contemplated under the Act, and each Registration
Statement and the Prospectus, and each amendment or supplement
thereto, 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; the
descriptions in the Registration Statements and Prospectus of
statutes, legal and governmental proceedings and contracts and
other documents are accurate and fairly present the
information required to be shown; and such counsel does not
know of any legal or governmental proceedings required to be
described in a Registration Statement or the Prospectus which
are not described as required or of any contracts or documents
of a character required to be described in a Registration
Statement or the Prospectus or to be filed as exhibits to a
Registration Statement which are not described and filed as
required; it being understood that such counsel need express
no opinion as to the financial statements or other financial
data contained in the Registration Statements or the
Prospectus; and
(viii)This Agreement has been duly authorized, executed and
delivered by the Company.
Such counsel shall also state that it has no reason to believe
that any part of a Registration Statement or any amendment thereto,
as of its effective date or as of such Closing Date, contained any
untrue statement of a material fact or omitted to state any material
fact required to be stated therein or necessary to make the
statements therein not misleading
(f) The Underwriter shall have received an opinion, dated such
Closing Date, of Xxxxxxxx, Rackman & Xxxxxxx, P.C., patent counsel
for the Company, to the effect that:
(i) Such counsel has no knowledge of any reason that any
patent of the Company is not valid and has no knowledge of any
reason why any patents that may issue from applications for
patents filed by the Company with the United States Patent and
Trademark Office would not be valid;
(ii) To the knowledge of such counsel, the Company is not
infringing or otherwise violating any patents, trade secrets,
know-how or proprietary rights or techniques of others and
there is no pending, or, to the knowledge of such counsel,
threatened action, suit, proceeding or claim by others that
the Company has infringed or otherwise violated any patents,
licensing rights, licensing or royalty arrangements or
agreements, trade secrets or know-how and proprietary rights;
(iii) To the knowledge of such counsel, there is no
infringement on the part of any third party of any patent,
application for patent, trade secret, know-how or other
proprietary right of the Company, and there is no pending or,
to the knowledge of such counsel, threatened action, suit,
proceeding or claim by others challenging the validity or
scope of any patent or application for patent by the Company;
(iv) To the knowledge of such counsel, the statements in the
Registration Statements and Prospectus and any amendments and
supplements thereto under the captions "Risk Factors--Our
proprietary rights may not be fully protected, and we may be
subject to intellectual property infringement claims by
others" and "Business--Proprietary Rights," insofar as such
statements constitute a summary of the Company's patents,
applications for patents and proprietary technology, are in
all material respects accurate descriptions of the legal
matters, documents and proceedings relating thereto; and
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(v) Such counsel has reviewed the statements in the
Registration Statements and Prospectus and any amendments and
supplements thereto under the captions "Risk Factors--Our
proprietary rights may not be fully protected, and we may be
subject to intellectual property infringement claims by others
and "Business--Proprietary Rights," and such counsel has no
reason to believe that as of their respective effective dates
or as of such Closing Date, such portions of the Registration
Statement or the Prospectus or any amendment or supplement
thereto contained any untrue statement of a material fact or
omitted to state any material fact required to be stated
therein or necessary to make the statements therein not
misleading or that as of its issue date or such Closing Date,
such portions of the Prospectus or any amendment or supplement
contains any untrue statement of a material fact or omits to
state any material fact necessary to make the statements
therein, in light of the circumstances under which they were
made, not misleading.
(g) The Underwriter shall have received an opinion, dated such
Closing Date of Xxx Xxxxxxx-Xxxxx, Vice President, Legal Affairs of
the Company, to the effect that she has no reason to believe that
any part of a Registration Statement or any amendment thereto, as of
its effective date or as of such Closing Date, contained any untrue
statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading; or that the Prospectus or any amendment or
supplement thereto, as of its issue date or as of such Closing Date,
contained any untrue statement of a material fact or omitted 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; and she does not know of any legal or
governmental proceedings required to be described in a Registration
Statement or the Prospectus which are not described as required or
of any contracts or documents of a character required to be
described in a Registration Statement or the Prospectus or to be
filed as exhibits to a Registration Statement which are not
described and filed as required; it being understood that she need
express no opinion as to the financial statements or other financial
data contained in the Registration Statements or the Prospectus; and
(h) The Underwriter shall have received from Xxxxxx, Xxxxx & Bockius
LLP, counsel for the Underwriter, such opinion or opinions, dated
such Closing Date, with respect to the incorporation of the Company,
the validity of the Offered Securities delivered on such Closing
Date, the Registration Statements, the Prospectus and other related
matters as the Representatives may require, and the Company shall
have furnished to such counsel such documents as they request for
the purpose of enabling them to pass upon such matters.
(i) The Underwriter shall have received a certificate, dated such
Closing Date, of the President and the Chief Financial Officer of
the Company in which such officers, to the best of their knowledge
after reasonable investigation, shall state that: the
representations and warranties of the Company in this Agreement are
true and correct; the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied
hereunder at or prior to such Closing Date; no stop order suspending
the effectiveness of any Registration Statement has been issued and
no proceedings for that purpose have been instituted or are
contemplated by the Commission; the Additional Registration
Statement (if any) satisfying the requirements of subparagraphs (1)
and (3) of Rule 462(b) was filed pursuant to Rule 462(b), including
payment of the applicable filing fee in accordance with Rule 111(a)
or (b) under the Act, prior to the time the Prospectus was printed
and distributed to the Underwriter; and, subsequent to the
respective dates of the most recent financial statements in the
Prospectus, there has been no material adverse change, nor any
development or event involving a prospective material adverse
change, in the condition (financial or other), business, properties
or results of operations of the Company and its subsidiaries taken
as a whole except as set forth in or contemplated by the Prospectus
or as described in such certificate.
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(j) The Company shall have delivered to you the agreements specified
in Section 5(j) hereof which agreements shall be in full force and
effect on the Closing Date.
(k) The Underwriter shall have received a letter, dated such Closing
Date, of PricewaterhouseCoopers LLP which meets the requirements of
subsection (a) of this Section, except that the specified date
referred to in such subsection will be a date not more than three
business days prior to such Closing Date for the purposes of this
subsection.
The Company will furnish the Underwriter with such conformed copies of such
opinions, certificates, letters and documents as the Underwriter reasonably
requests. The Underwriter may in its sole discretion waive compliance with any
conditions to the obligations of the Underwriter hereunder, whether in respect
of an Optional Closing Date or otherwise.
7. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless the Underwriter
against any losses, claims, damages or liabilities, joint or
several, to which the Underwriter may become subject, under the Act
or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact
contained in any Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any related preliminary
prospectus, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and will reimburse the Underwriter for any legal or
other expenses reasonably incurred by the Underwriter in connection
with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred; provided,
however, that the Company will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement in
or omission or alleged omission from any of such documents in
reliance upon and in conformity with written information furnished
to the Company by the Underwriter specifically for use therein, it
being understood and agreed that the only such information furnished
by the Underwriter consists of the information described as such in
subsection (c) below.
(b) Insofar as the foregoing indemnity agreement, or the
representations and warranties contained in Section 2(b), may permit
indemnification for liabilities under the Act of any person who is
an Underwriter or a partner or controlling person of an Underwriter
within the meaning of Section 15 of the Act and who, at the date of
this Agreement, is a director, officer or controlling person of the
Company, the Company has been advised that in the opinion of the
Commission such provisions may contravene Federal public policy as
expressed in the Act and may therefore be unenforceable. In the
event that a claim for indemnification under such agreement or such
representations and warranties for any such liabilities (except
insofar as such agreement provides for the payment by the Company of
expenses incurred or paid by a director, officer or controlling
person in the successful defense of any action, suit or proceeding)
is asserted by such a person, the Company will submit to a court of
appropriate jurisdiction (unless in the opinion of counsel for the
Company the matter has already been settled by controlling
precedent) the question of whether or not indemnification by it for
such liabilities is against public policy as expressed in the Act
and therefore unenforceable, and the Company will be governed by the
final adjudication of such issue.
(c) The Underwriter will 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 any
Registration Statement, the Prospectus, or any amendment or
supplement thereto,
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or any related preliminary prospectus, or arise out of or are based
upon the omission or the alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, in 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 the Underwriter specifically for use therein, and will reimburse
any legal or other expenses reasonably incurred by the Company in
connection with investigating or defending any such loss, claim,
damage, liability or action as such expenses are incurred, it being
understood and agreed that the only such information furnished by
the Underwriter consists of the concession and reallowance figures
appearing in the fourth paragraph under the caption "Underwriting";
the information pertaining to prior compensation and shareholdings
of the Underwriter and certain related persons in the twelfth
paragraph under the heading "Underwriting"; and the information
appearing in the last paragraph under the caption "Underwriting."
(d) Promptly after receipt by an indemnified party under this
Section of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made
against an indemnifying party under subsection (a) or (c) above,
notify the indemnifying party of the commencement thereof; but the
omission so to notify the indemnifying party will not relieve it
from any liability which it may have to any indemnified party
otherwise than under subsection (a) or (c) above. In case any such
action is brought against any indemnified party and it notifies an
indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein and, to the extent
that it may wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except with
the consent of the indemnified party, be counsel to the indemnifying
party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof,
the indemnifying party will not be liable to such indemnified party
under this Section for any legal or other expenses subsequently
incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation. No
indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or
threatened action in respect of which any indemnified party is or
could have been a party and indemnity could have been sought
hereunder by such indemnified party unless such settlement includes
an unconditional release of such indemnified party from all
liability on any claims that are the subject matter of such action.
(e) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party
under subsection (a) or (c) above, then each indemnifying party
shall contribute to the amount paid or payable by such indemnified
party as a result of the losses, claims, damages or liabilities
referred to in subsection (a) or (c) above (i) in such proportion as
is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriter on the other from the
offering of the Offered Securities or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault
of the Company on the one hand and the Underwriter on the other in
connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities as well as any other relevant
equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriter 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
bear to the total underwriting discounts and commissions received by
the Underwriter. 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
or the Underwriter and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such
untrue statement or omission. The amount paid by an indemnified
party as a result of the losses, claims, damages or liabilities
referred to in the first sentence of this subsection (e) shall be
deemed to include any
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legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any action or
claim which is the subject of this subsection (e). Notwithstanding
the provisions of this subsection (e), the Underwriter shall not be
required to contribute any amount in excess of the amount by which
the total price at which the Offered Securities underwritten by it
and distributed to the public were offered to the public exceeds the
amount of any damages which the 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(d) of the Act)
shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation.
f. The obligations of the Company under this Section shall be in
addition to any liability which the Company may otherwise have and
shall extend, upon the same terms and conditions, to each person, if
any, who controls the Underwriter within the meaning of the Act; and
the obligations of the Underwriter under this Section shall be in
addition to any liability which the Underwriter may otherwise have
and shall extend, upon the same terms and conditions, to each
director of the Company, to each officer of the Company who has
signed a Registration Statement and to each person, if any, who
controls the Company within the meaning of the Act.
8. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and the Underwriter set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation, or statement as to the results thereof, made by or on behalf of
the Underwriter, the Company or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the Offered Securities. If this Agreement is terminated pursuant
to Section 8 or if for any reason the purchase of the Offered Securities by the
Underwriter is not consummated, the Company shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 5 and the respective
obligations of the Company and the Underwriter pursuant to Section 7 shall
remain in effect, and if any Offered Securities have been purchased hereunder
the representations and warranties in Section 2 and all obligations under
Section 5 shall also remain in effect. If the purchase of the Offered Securities
by the Underwriter is not consummated for any reason other than solely because
of the occurrence of any event specified in clause (ii), (iii) or (iv) of
Section 6(c), the Company will reimburse the Underwriter for all out-of-pocket
expenses (including fees and disbursements of counsel) reasonably incurred by it
in connection with the offering of the Offered Securities.
9. Notices. All communications hereunder will be in writing and, if sent
to the Underwriter, will be mailed, delivered or telegraphed and confirmed to
the Underwriter, Invemed Associates, LLC, 000 Xxxx Xxxxxx, Xxx Xxxx, XX
00000-0000 Attention: Xxxxxxxx X. Xxxxxx - Executive Vice President, or, if sent
to the Company, will be mailed, delivered or telegraphed and confirmed to it at
InterWorld Corporation, 395 Xxxxxx Street, 6th Floor, New York, N.Y. 10014,
Attention: Xxx Xxxxxxx-Xxxxx.
10. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective personal representatives and
successors and the officers and directors and controlling persons referred to in
Section 7, and no other person will have any right or obligation hereunder.
11. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
12. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS.
The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
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If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to the Company one of the counterparts hereof,
whereupon it will become a binding agreement among the Company and the
Underwriter in accordance with its terms.
Very truly yours,
INTERWORLD CORPORATION
By_______________________________
[Insert title]
The foregoing Underwriting Agreement is hereby
confirmed and accepted as of the date first above
written.
INVEMED ASSOCIATES, LLC
By___________________________
[Insert title]
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