1
EXHIBIT 1.1
8,944,700 Shares
PENTON MEDIA, INC.
Common Stock
UNDERWRITING AGREEMENT
----------------------
May __, 1999
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
XXXXXXX XXXXX BARNEY INC.
BEAR XXXXXXX & CO. INC.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
As representatives of the several Underwriters
named in Schedule I hereto
c/x Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Penton Media, Inc., a Delaware corporation (the "COMPANY"), proposes to
issue and sell to the several underwriters named in Schedule I hereto (the
"UNDERWRITERS"), and certain stockholders of the Company named in Schedule II
hereto (the "SELLING STOCKHOLDERS") severally propose to sell to the several
Underwriters, an aggregate of 7,778,000 shares of the common stock, par value
$.01 per share, of the Company (the "FIRM SHARES"), of which 6,250,000 shares
are to be issued and sold by the Company and 1,528,000 shares are to be sold by
the Selling Stockholders, each Selling Stockholder selling the amount set forth
opposite such Selling Stockholder's name in Schedule II hereto. The Selling
Stockholders also propose to issue and sell to the several Underwriters not more
than an additional 1,166,700 shares of the Company's common stock, par value
$.01 per share (the "ADDITIONAL SHARES"), if requested by the Underwriters as
provided in Section 2 hereof. The Firm Shares and the Additional Shares are
hereinafter referred to collectively as the "SHARES." The shares of common stock
of the Company to be outstanding after giving effect to the sales contemplated
hereby are hereinafter referred to as the "COMMON STOCK." The Company and the
Selling Stockholders are hereinafter sometimes referred to collectively as the
"SELLERS."
SECTION 1. Registration Statement and Prospectus. The Company
has prepared and filed with the Securities and Exchange Commission (the
"COMMISSION") in accordance with the provisions of the Securities Act of 1933,
as amended, and the rules and
1
2
regulations of the Commission thereunder (collectively, the "ACT"), a
registration statement on Form S-3 (No. 333-75555), including a prospectus,
relating to the Shares. The registration statement, as amended at the time it
became effective, including the information (if any) deemed to be part of the
registration statement at the time of effectiveness pursuant to Rule 430A under
the Act, is hereinafter referred to as the "REGISTRATION STATEMENT"; and the
prospectus in the form first used to confirm sales of Shares is hereinafter
referred to as the "PROSPECTUS" (including in the case of all references to the
Registration Statement or the Prospectus, documents incorporated therein by
reference). If the Company has filed or is required pursuant to the terms hereof
to file a registration statement pursuant to Rule 462(b) under the Act
registering additional shares of Common Stock (a "RULE 462(b) REGISTRATION
STATEMENT"), then, unless otherwise specified, any reference herein to the term
"Registration Statement" shall be deemed to include such Rule 462(b)
Registration Statement. The terms "SUPPLEMENT" and "AMENDMENT" or "AMEND" as
used in this Agreement with respect to the Registration Statement or the
Prospectus shall include all documents subsequently filed by the Company with
the Commission pursuant to the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the Commission thereunder (collectively, the
"EXCHANGE ACT") that are deemed to be incorporated by reference in the
Prospectus.
SECTION 2. Agreements to Sell and Purchase and Lock-Up
Agreements. On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, (i) the Company agrees to
issue and sell 6,250,000 Firm Shares, (ii) each Selling Stockholder agrees,
severally and not jointly, to sell the number of Firm Shares set forth opposite
such Selling Stockholder's name in Schedule II hereto and (iii) each Underwriter
agrees, severally and not jointly, to purchase from each Seller at a price per
Share of $______ (the "PURCHASE PRICE") the number of Firm Shares (subject to
such adjustments to eliminate fractional shares as you may determine) that bears
the same proportion to the total number of Firm Shares to be sold by such Seller
as the number of Firm Shares set forth opposite the name of such Underwriter in
Schedules I hereto bears to the total number of Firm Shares.
On the basis of the representations and warranties contained
in this Agreement, and subject to its terms and conditions, the Selling
Stockholders agree to issue and sell the number of Additional Shares set forth
opposite such Selling Stockholder's name in Schedule II hereto and the
Underwriters shall have the right to purchase, severally and not jointly, up to
1,166,700 Additional Shares from the Selling Stockholders at the Purchase Price.
Additional Shares may be purchased solely for the purpose of covering
over-allotments made in connection with the offering of the Firm Shares. The
Underwriters may exercise their right to purchase Additional Shares in whole or
in part from time to time by giving written notice thereof to the Selling
Stockholders, with a copy to the Company, for 30 days after the date of this
Agreement. You shall give any such notice on behalf of the Underwriters and such
notice shall specify the aggregate number of Additional Shares to be purchased
pursuant to such exercise and the date for payment and delivery thereof, which
date shall be a business day (i) no earlier than two business days after such
notice has been given (and, in any event, no earlier than the Closing Date (as
hereinafter defined)) and (ii) no later than ten business days after such notice
has been given. If
2
3
any Additional Shares are to be purchased, each Underwriter, severally and not
jointly, agrees to purchase from the Selling Stockholders the number of
Additional Shares (subject to such adjustments to eliminate fractional shares as
you may determine) which bears the same proportion to the total number of
Additional Shares to be purchased from the Selling Stockholders as the number of
Firm Shares set forth opposite the name of such Underwriter in Schedule I bears
to the total number of Firm Shares.
Each Seller hereby agrees not to (i) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase, or
otherwise transfer or dispose of, directly or indirectly, any shares of Common
Stock or any securities convertible into or exercisable or exchangeable for
Common Stock or (ii) enter into any swap or other arrangement that transfers all
or a portion of the economic consequences associated with the 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), except to the Underwriters pursuant to this
Agreement, for a period of 90 days after the date of the Prospectus without the
prior written joint consent of Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation and Xxxxxxx Xxxxx Barney Inc. Notwithstanding the foregoing, during
such period (i) the Company may grant stock options pursuant to the Company's
existing stock option plans; (ii) the Company may issue shares of Common Stock
upon the exercise of an option or warrant or the conversion of a security
outstanding on the date hereof; (iii) the Company may issue shares of Common
Stock in connection with the acquisition of a business media company, as set
forth in that certain Letter of Intent, dated March 23, 1999; and (iv) the
Selling Stockholders may transfer or otherwise dispose of shares of Common Stock
by bona fide gift, by will or by the laws of descent and distribution, provided
that, in any such case, it shall be a condition to such transfer or disposition
that the transferee or recipient execute an agreement stating that such person
agrees to be bound by the terms of this Section 2. The Company also agrees not
to file any registration statement with respect to any shares of Common Stock or
any securities convertible into or exercisable or exchangeable for Common Stock
for a period of 90 days after the date of the Prospectus without the prior
written joint consent of Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation and
Xxxxxxx Xxxxx Barney Inc. In addition, each Selling Stockholder agrees that, for
a period of 90 days after the date of the Prospectus without the prior written
joint consent of Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation and Xxxxxxx
Xxxxx Barney Inc., it will not 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. The Company
shall, prior to or concurrently with the execution of this Agreement, deliver an
agreement executed by (i) each Selling Stockholder and (ii) each of the
directors and executive officers of the Company who is not a Selling
Stockholder, and who is listed on Schedule III hereto, to the effect that such
person will not, during the period commencing on the date such person signs such
agreement and ending 90 days after the date of the Prospectus, without the prior
written joint consent of Xxxxxxxxx, Xxxxxx & Xxxxxxxx Corporation and Xxxxxxx
Xxxxx Barney Inc., (A) engage in any of the transactions described in the first
sentence of this paragraph or (B) make any
3
4
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.
SECTION 3. Terms of Public Offering. The Sellers are advised
by you that the Underwriters propose (i) to make a public offering of their
respective portions of the Shares as soon after the execution and delivery of
this Agreement as in your judgment is advisable and (ii) initially to offer the
Shares upon the terms set forth in the Prospectus.
SECTION 4. Delivery and Payment. The Shares shall be
represented by definitive certificates and shall be issued in such authorized
denominations and registered in such names as Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation shall request no later than two business days prior to
the Closing Date or the applicable Option Closing Date (as defined below), as
the case may be. The Shares shall be delivered by or on behalf of the Sellers,
with any transfer taxes thereon duly paid by the respective Sellers, to
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation through the facilities of
The Depository Trust Company ("DTC"), for the respective accounts of the several
Underwriters, against payment to the Sellers of the Purchase Price therefor by
wire transfer of Federal or other funds immediately available in New York City.
The certificates representing the Shares shall be made available for inspection
not later than 9:30 A.M., New York City time, on the business day prior to the
Closing Date or the applicable Option Closing Date (as defined below), as the
case may be, at the office of DTC or its designated custodian (the "DESIGNATED
OFFICE"). The time and date of delivery and payment for the Firm Shares shall be
9:00 A.M., New York City time, on May __, 1999 or such other time on the same or
such other date as Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation and the
Company shall agree in writing. The time and date of delivery and payment for
the Firm Shares are hereinafter referred to as the "CLOSING DATE." The time and
date of delivery and payment for any Additional Shares to be purchased by the
Underwriters shall be 9:00 A.M., New York City time, on the date specified in
the applicable exercise notice given by you pursuant to Section 2 or such other
time on the same or such other date as Xxxxxxxxx, Lufkin & Xxxxxxxx Securities
Corporation and the Company shall agree in writing. The time and date of
delivery and payment for any Additional Shares are hereinafter referred to as
the "OPTION CLOSING DATE."
The documents to be delivered on the Closing Date or any
Option Closing Date on behalf of the parties hereto pursuant to Section 9 of
this Agreement shall be delivered at the Chicago offices of Skadden, Arps,
Slate, Xxxxxxx & Xxxx LLP and the Shares shall be delivered at the Designated
Office, all on the Closing Date or such Option Closing Date, as the case may be.
SECTION 5. Agreements of the Company. The Company agrees with
you:
(a) To advise you promptly and, if requested by
you, to confirm such advice in writing, (i) of any request by the Commission for
amendments to the Registration Statement or amendments or supplements to the
Prospectus or for additional information, (ii) of the issuance by the Commission
of any stop order suspending the effectiveness of the Registration Statement or
of the suspension of qualification of any of the Shares for offering or
4
5
sale in any jurisdiction, or the initiation of any proceeding for such purposes,
(iii) when any amendment to the Registration Statement becomes effective, (iv)
if the Company is required to file a Rule 462(b) Registration Statement after
the effectiveness of this Agreement, when the Rule 462(b) Registration Statement
has become effective, and (v) of the happening of any event during the period
referred to in Section 5(d) below which makes any statement of a material fact
made in the Registration Statement or the Prospectus untrue or which requires
any additions to or changes in the Registration Statement or the Prospectus in
order to make the statements therein not misleading. If at any time the
Commission shall issue any stop order suspending the effectiveness of the
Registration Statement, the Company will use its best efforts to obtain the
withdrawal or lifting of such order at the earliest possible time.
(b) To furnish to you five (5) signed copies of the
Registration Statement as first filed with the Commission and of each amendment
to it, including all exhibits and documents incorporated therein by reference,
and to furnish to you and each Underwriter designated by you such number of
conformed copies of the Registration Statement as so filed and of each amendment
to it, without exhibits but including documents incorporated therein by
reference, as you may reasonably request.
(c) To prepare the Prospectus, the form and
substance of which shall be satisfactory to you, and to file the Prospectus in
such form with the Commission within the applicable period specified in Rule
424(b) under the Act; during the period specified in Section 5(d) below, not to
file any further amendment to the Registration Statement and not to make any
amendment or supplement to the Prospectus of which you shall not previously have
been advised or to which you shall reasonably object after being so advised;
and, during such period, to prepare and file with the Commission, promptly upon
your reasonable request, any amendment to the Registration Statement or
amendment or supplement to the Prospectus which may be necessary or advisable in
connection with the distribution of the Shares by you, and to use its best
efforts to cause any such amendment to the Registration Statement to become
promptly effective.
(d) Prior to 10:00 A.M., New York City time, on the
first business day after the date of this Agreement and from time to time
thereafter for such period as in the opinion of counsel for the Underwriters a
prospectus is required by law to be delivered in connection with sales by an
Underwriter or a dealer, to furnish in New York City to each Underwriter and any
dealer as many copies of the Prospectus (and of any amendment or supplement to
the Prospectus) and any documents incorporated therein by reference as such
Underwriter or dealer may reasonably request.
(e) If during the period specified in Section 5(d),
any event shall occur or condition shall exist as a result of which, in the
opinion of counsel for the Underwriters, it becomes necessary to amend or
supplement the Prospectus in order to make the statements therein, in the light
of the circumstances when the Prospectus is delivered to a purchaser, not
misleading, or if, in the opinion of counsel for the Underwriters, it is
necessary to amend or
5
6
supplement the Prospectus to comply with applicable law, forthwith to prepare
and file with the Commission an appropriate amendment or supplement to the
Prospectus so that the statements in the Prospectus, as so amended or
supplemented, will not, in the light of the circumstances when it is so
delivered, be misleading, or so that the Prospectus will comply with applicable
law, and to furnish to each Underwriter and to any dealer as many copies thereof
as such Underwriter or dealer may reasonably request.
(f) Prior to any public offering of the Shares, to
cooperate with you and counsel for the Underwriters in connection with the
registration or qualification of the Shares for offer and sale by the several
Underwriters and by dealers under the state securities or Blue Sky laws of such
jurisdictions as you may request, to continue such registration or qualification
in effect so long as required for distribution of the Shares and to file such
consents to service of process or other documents as may be necessary in order
to effect such registration or qualification; provided, however, that the
Company shall not be required in connection therewith to qualify as a foreign
corporation in any jurisdiction in which it is not now so qualified or to take
any action that would subject it to general consent to service of process or
taxation other than as to matters and transactions relating to the Prospectus,
the Registration Statement, any preliminary prospectus or the offering or sale
of the Shares, in any jurisdiction in which it is not now so subject.
(g) To mail and make generally available to its
stockholders as soon as practicable an earnings statement covering the
twelve-month period ending June 30, 2000 that shall satisfy the provisions of
Section 11(a) of the Act, and to advise you in writing when such statement has
been so made available.
(h) During the period of three years after the date
of this Agreement, to furnish to you as soon as available copies of all reports
or other communications furnished to the record holders of Common Stock or
furnished to or filed with the Commission or any national securities exchange on
which any class of securities of the Company is listed and such other publicly
available information concerning the Company and its subsidiaries as you may
reasonably request.
(i) Whether or not the transactions contemplated in
this Agreement are consummated or this Agreement is terminated, to pay or cause
to be paid all expenses incident to the performance of the Sellers' obligations
under this Agreement, including: (i) the fees, disbursements and expenses of the
Company's counsel, the Company's accountants and any Selling Stockholder's
counsel that the Company is obligated to pay by contract (in addition to the
Company's counsel) in connection with the registration and delivery of the
Shares under the Act and all other fees and expenses in connection with the
preparation, printing, filing and distribution of the Registration Statement
(including financial statements and exhibits), any preliminary prospectus, the
Prospectus and all amendments and supplements to any of the foregoing, including
the mailing and delivering of copies thereof to the Underwriters and dealers in
the quantities specified herein, (ii) all costs and expenses related to the
transfer and delivery of
6
7
the Shares to the Underwriters, including any transfer or other taxes payable
thereon, (iii) all costs of printing this Agreement and any other agreements or
documents in connection with the offering, purchase, sale or delivery of the
Shares, (iv) all expenses in connection with the registration or qualification
of the Shares for offer and sale under the securities or Blue Sky laws of the
several states and all costs of printing or producing any Preliminary and
Supplemental Blue Sky Memoranda in connection therewith (including the filing
fees and fees and disbursements of counsel for the Underwriters in connection
with such registration or qualification and memoranda relating thereto not to
exceed $15,000), (v) the filing fees and fees and disbursements of counsel for
the Underwriters in connection with the review and clearance of the offering of
the Shares by the National Association of Securities Dealers, Inc., (vi) all
costs and expenses incident to the listing of the Shares on the New York Stock
Exchange (the "NYSE"), (vii) the cost of printing certificates representing the
Shares, (viii) the costs and charges of any transfer agent, registrar and/or
depositary, and (ix) all other costs and expenses incident solely to the
performance of the obligations of the Company and the Selling Stockholders
hereunder for which provision is not otherwise made in this Section. The
provisions of this Section shall not supersede or otherwise affect any agreement
that the Company and the Selling Stockholders may otherwise have for allocation
of such expenses among themselves.
(j) To use its best efforts to list the Shares on
the NYSE.
(k) To use its best efforts to do and perform all
things required or necessary to be done and performed under this Agreement by
the Company on or prior to the Closing Date or any Option Closing Date, as the
case may be, and to satisfy all conditions precedent to the delivery of the
Shares.
(l) If the Registration Statement at the time of
the effectiveness of this Agreement does not cover all of the Shares, to file a
Rule 462(b) Registration Statement with the Commission registering the Shares
not so covered in compliance with Rule 462(b) by 10:00 P.M., New York City time,
on the date of this Agreement and to pay to the Commission the filing fee for
such Rule 462(b) Registration Statement at the time of the filing thereof or to
give irrevocable instructions for the payment of such fee pursuant to Rule
111(b) under the Act.
SECTION 6. Representations and Warranties of the Company. The
Company represents and warrants to each Underwriter that:
(a) The Registration Statement has become effective
(other than any Rule 462(b) Registration Statement to be filed by the Company
after the effectiveness of this Agreement); any Rule 462(b) Registration
Statement filed after the effectiveness of this Agreement will become effective
no later than 10:00 P.M., New York City time, on the date of this Agreement; and
no stop order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or threatened by
the Commission.
7
8
(b) (i) Each document, if any, filed or to be filed
pursuant to the Exchange Act and incorporated by reference in the Prospectus
complied or will comply when so filed in all material respects with the Act and
the Exchange Act; (ii) the Registration Statement (other than any Rule 462(b)
Registration Statement to be filed by the Company after the effectiveness of
this Agreement), when it became effective, did not contain and, as amended, if
applicable, will not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, (iii) the Registration Statement (other than
any Rule 462(b) Registration Statement to be filed by the Company after the
effectiveness of this Agreement) and the Prospectus comply and, as amended or
supplemented, if applicable, will comply in all material respects with the Act,
(iv) if the Company is required to file a Rule 462(b) Registration Statement
after the effectiveness of this Agreement, such Rule 462(b) Registration
Statement and any amendments thereto, when they become effective (A) will not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading and (B) will comply in all material respects with the Act and (v) the
Prospectus does not contain and, as amended or supplemented, if applicable, will
not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, except that the representations and
warranties set forth in this paragraph do not apply to statements or omissions
in the Registration Statement or the Prospectus based upon information relating
to any Underwriter furnished to the Company in writing by such Underwriter
through you expressly for use therein. The parties hereto acknowledge that for
purposes of this Agreement, including this Section 6(b) and Section 8 hereof,
the only written information furnished to the Sellers by any Underwriter
expressly for use in the Registration Statement or any preliminary prospectus or
the Prospectus is the information contained under the caption "Underwriting" in
the Prospectus in the table in the first paragraph, and in the third, fourth,
eighth and tenth paragraphs of such section.
(c) Each preliminary prospectus filed as part of
the registration statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Act, complied when so filed in
all material respects with the Act, and did not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, except that the representations and
warranties set forth in this paragraph do not apply to statements or omissions
in any preliminary prospectus based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through you expressly
for use therein.
(d) 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 the corporate power
and authority to carry on its business as described in the Prospectus and to
own, lease and operate its properties, and each is duly
8
9
qualified and is in good standing as a foreign corporation authorized to do
business in each jurisdiction in which the nature of its business or its
ownership or leasing of property requires such qualification, except where the
failure to be so qualified would not have a material adverse effect on the
business, prospects, financial condition or results of operations of the Company
and its subsidiaries, taken as a whole.
(e) There are no outstanding subscriptions, rights,
warrants, options, calls, convertible securities, commitments of sale or liens
granted or issued by the Company or any of its subsidiaries relating to or
entitling any person to purchase or otherwise to acquire any shares of the
capital stock of the Company or any of its subsidiaries, except as otherwise
disclosed in the Prospectus.
(f) All the outstanding shares of capital stock of
the Company (including the Shares to be sold by the Selling Stockholders) have
been duly authorized and validly issued and are fully paid, non-assessable and
not subject to any preemptive or similar rights; and the Shares to be issued and
sold by the Company have been duly authorized and, when issued and delivered to
the Underwriters against payment therefor as provided by this Agreement, will be
validly issued, fully paid and non-assessable, and the issuance of such Shares
will not be subject to any preemptive or similar rights.
(g) All of the outstanding shares of capital stock
of each of the Company's subsidiaries have been duly authorized and validly
issued and are fully paid and non-assessable, and are owned by the Company,
directly or indirectly through one or more subsidiaries, free and clear of any
security interest, claim, lien, encumbrance or adverse interest of any nature.
(h) The authorized capital stock of the Company
conforms as to legal matters to the description thereof contained in the
Prospectus.
(i) Neither the Company nor any of its subsidiaries
is in violation of its respective charter or by-laws or in default in the
performance of any obligation, agreement, covenant or condition contained in any
indenture, loan agreement, mortgage, lease or other agreement or instrument that
is material to the Company and its subsidiaries, taken as a whole, to which the
Company or any of its subsidiaries is a party or by which the Company or any of
its subsidiaries or their respective property is bound.
(j) The execution, delivery and performance of this
Agreement by the Company, the compliance by the Company with all the provisions
hereof and the consummation of the transactions contemplated hereby will not (i)
require any consent, approval, authorization or other order of, or qualification
with, any court or governmental body or agency (except such as may be required
under the securities or Blue Sky laws of the various states or as may have been
obtained prior to the date hereof), (ii) conflict with or constitute a breach of
any of the terms or provisions of, or a default under, the charter or by-laws of
the Company or any of its
9
10
subsidiaries or any indenture, loan agreement, mortgage, lease or other
agreement or instrument that is material to the Company and its subsidiaries,
taken as a whole, to which the Company or any of its subsidiaries is a party or
by which the Company or any of its subsidiaries or their respective property is
bound, (iii) violate or conflict with any applicable law or any rule,
regulation, judgment, order or decree of any court or any governmental body or
agency having jurisdiction over the Company, any of its subsidiaries or their
respective property or (iv) result in the suspension, termination or revocation
of any Authorization (as defined below) of the Company or any of its
subsidiaries or any other impairment of the rights of the holder of any such
Authorization.
(k) There are no legal or governmental proceedings
pending or threatened to which the Company or any of its subsidiaries is or
could be a party or to which any of their respective property is or could be
subject that are required to be described in the Registration Statement or the
Prospectus and are not so described; nor are there any statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not so described or filed as required.
(l) Neither the Company nor any of its subsidiaries
has violated any foreign, federal, state or local law or regulation relating to
the protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants ("ENVIRONMENTAL LAWS"), any
provisions of the Employee Retirement Income Security Act of 1974, as amended,
or any provisions of the Foreign Corrupt Practices Act or the rules and
regulations promulgated thereunder, except for such violations which, singly or
in the aggregate, would not have a material adverse effect on the business,
prospects, financial condition or results of operation of the Company and its
subsidiaries, taken as a whole.
(m) Each of the Company and its subsidiaries has
such permits, licenses, consents, exemptions, franchises, authorizations and
other approvals (each, an "AUTHORIZATION") of, and has made all filings with and
notices to, all governmental or regulatory authorities and self-regulatory
organizations and all courts and other tribunals, including, without limitation,
under any applicable Environmental Laws, as are necessary to own, lease, license
and operate its respective properties and to conduct its business, except where
the failure to have any such Authorization or to make any such filing or notice
would not, singly or in the aggregate, have a material adverse effect on the
business, prospects, financial condition or results of operations of the Company
and its subsidiaries, taken as a whole. Each such Authorization is valid and in
full force and effect and each of the Company and its subsidiaries is in
compliance with all the terms and conditions thereof and with the rules and
regulations of the authorities and governing bodies having jurisdiction with
respect thereto; and no event has occurred (including, without limitation, the
receipt of any notice from any authority or governing body) which allows or,
after notice or lapse of time or both, would allow, revocation, suspension or
termination of any such Authorization or results or, after notice or lapse of
time or both, would result in any other impairment of the rights of the holder
of any such Authorization; and such Authorizations
10
11
contain no restrictions that are burdensome to the Company or any of its
subsidiaries; except where such failure to be valid and in full force and effect
or to be in compliance, the occurrence of any such event or the presence of any
such restriction would not, singly or in the aggregate, have a material adverse
effect on the business, prospects, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole.
(n) There are no costs or liabilities associated
with Environmental Laws (including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or compliance with
Environmental Laws or any Authorization, any related constraints on operating
activities and any potential liabilities to third parties) which would, singly
or in the aggregate, have a material adverse effect on the business, prospects,
financial condition or results of operations of the Company and its
subsidiaries, taken as a whole.
(o) This Agreement has been duly authorized,
executed and delivered by the Company.
(p) (i) PricewaterhouseCoopers LLP are independent
public accountants with respect to the Company and its subsidiaries as required
by the Act; and (ii) Xxxxxx Xxxxxxxx LLP were independent public accountants
with respect to Mecklermedia Corporation prior to the acquisition thereof by the
Company.
(q) The consolidated financial statements included
or incorporated by reference in the Registration Statement and the Prospectus
(and any amendment or supplement thereto), together with related schedules and
notes, present fairly the consolidated financial position, results of operations
and changes in financial position of the Company and its subsidiaries on the
basis stated therein at the respective dates or for the respective periods to
which they apply; such statements and related schedules and notes have been
prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except as disclosed
therein; the supporting schedules, if any, included in the Registration
Statement present fairly in accordance with generally accepted accounting
principles the information required to be stated therein; and the other
financial and statistical information and data set forth in the Registration
Statement and the Prospectus (and any amendment or supplement thereto) are, in
all material respects, accurately presented and prepared on a basis consistent
with such financial statements and the books and records of the Company.
(r) The Company is not and, after giving effect to
the offering and sale of the Shares and the application of the proceeds thereof
as described in the Prospectus, will not be, an "investment company" as such
term is defined in the Investment Company Act of 1940, as amended.
(s) Except as otherwise disclosed in the
Prospectus, there are no contracts, agreements or understandings between the
Company and any person granting such person the right to require the Company to
file a registration statement under the Act with respect
11
12
to any securities of the Company or to require the Company to include such
securities with the Shares registered pursuant to the Registration Statement.
(t) Since the respective dates as of which
information is given in the Prospectus other than as set forth in the Prospectus
(exclusive of any amendments or supplements thereto subsequent to the date of
this Agreement), (i) there has not occurred any material adverse change or any
development involving a prospective material adverse change in the condition,
financial or otherwise, or the earnings, business, management or operations of
the Company and its subsidiaries, taken as a whole, (ii) there has not been any
material adverse change or any development involving a prospective material
adverse change in the capital stock or in the long-term debt of the Company or
any of its subsidiaries and (iii) neither the Company nor any of its
subsidiaries has incurred any material liability or obligation, direct or
contingent.
(u) The Company and its subsidiaries own or
possess, or can acquire on reasonable terms, all patents, patent rights,
licenses, inventions, copyrights, knowhow (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information, systems
or procedures), trademarks, service marks, trade names, Internet domain names,
designs, logos, slogans and general intangibles of like nature, together with
goodwill, and registrations and applications relating to any of the foregoing,
as applicable ("INTELLECTUAL PROPERTY") currently employed by them in connection
with the business now operated by them except where the failure to own or
possess or otherwise be able to acquire such intellectual property would not,
singly or in the aggregate, have a material adverse effect on the business,
prospects, financial condition or results of operation of the Company and its
subsidiaries, taken as a whole; the intellectual property owned or used by the
Company or its subsidiaries has been duly maintained, is valid and subsisting,
in full force and effect, and has not been cancelled, expired or abandoned; and
neither the Company nor any of its subsidiaries has received any notice of
infringement of or conflict with asserted rights of others with respect to any
of such intellectual property which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would have a material adverse
effect on the business, prospects, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole, and neither the Company
nor any of its subsidiaries has knowledge of any basis for such claim.
(v) All material tax returns required to be filed
by the Company and each of its subsidiaries in any jurisdiction have been filed,
other than those filings being contested in good faith, and all material taxes,
including withholding taxes, penalties and interest, assessments, fees and other
charges due pursuant to such returns or pursuant to any assessment received by
the Company or any of its subsidiaries have been paid, other than those being
contested in good faith and for which adequate reserves have been provided.
(w) The Company had, at the time of the
consummation of the distribution of Common Stock of the Company to stockholders
of Pittway Corporation pursuant to the Combination Agreement, dated as of May
21, 1998, by and among the Company, Pittway Corporation, and others (the
"Combination Agreement"), no plan or intention to issue any shares
12
13
of Common Stock or any other equity security of the Company, other than the
issuances described in the Registration Statement of the Company on Form S-1
filed with the Commission on August 3, 1998.
(x) The Company has no present plan or intention to
issue Common Stock or any other equity security of the Company, other than the
issuances described in the Registration Statement.
(y) The Company has no present plan or intention to
redeem any outstanding Common Stock or any other equity security of the Company.
(z) The pro forma financial statements of the
Company and its subsidiaries and the related notes thereto set forth in the
Registration Statement and the Prospectus (and any supplement or amendment
thereto) have been prepared on a basis consistent with the historical financial
statements of the Company and its subsidiaries, give effect to the assumptions
used in the preparation thereof on a reasonable basis and in good faith and
present fairly the historical and proposed transactions contemplated by the
Registration Statement and the Prospectus. Such pro forma financial statements
have been prepared in accordance with, and there are no other pro forma
financial statements required by, the applicable requirements of Rule 11-02 of
Regulation S-X promulgated by the Commission. The other pro forma financial and
statistical information and data set forth in the Registration Statement and the
Prospectus (and any supplement or amendment thereto) are, in all material
respects, accurately presented and prepared on a basis consistent with the pro
forma financial statements.
(aa) The Company and each of its subsidiaries
maintains a system of internal accounting controls sufficient to provide
reasonable assurance that (i) transactions are executed in accordance with
management's general or specific authorizations; (ii) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain asset accountability;
(iii) access to assets is permitted only in accordance with management's general
or specific authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
(bb) Each certificate signed by any officer of the
Company and delivered to the Underwriters or counsel for the Underwriters shall
be deemed to be a representation and warranty by the Company to the Underwriters
as to the matters covered thereby.
SECTION 7. Representations and Warranties of the Selling
Stockholders. Each Selling Stockholder represents and warrants to each
Underwriter that:
(a) Such Selling Stockholder is the lawful owner of
the Shares to be sold by such Selling Stockholder pursuant to this Agreement and
has, and on the Closing Date
13
14
will have, good and clear title to such Shares, free of all restrictions on
transfer, liens, encumbrances, security interests, equities and claims
whatsoever.
(b) The Shares to be sold by such Selling
Stockholder have been duly authorized and are validly issued, fully paid and
non-assessable.
(c) Such Selling Stockholder has, and on the
Closing Date will have, full legal right, power and authority, and all
authorization and approval required by law, to enter into this Agreement, the
Power of Attorney and Custody Agreement signed by such Selling Stockholder and
Xxxxxx Xxxxxxxx, Xxxxxxx Xxxxxxx or [ ], as the case may be, as Attorney-In-Fact
and Custodian ("Attorney-In-Fact"), relating to the deposit of the Shares to be
sold by such Selling Stockholder and the transactions contemplated hereby and by
the Registration Statement (the "POWER OF ATTORNEY AND CUSTODY AGREEMENT") and
to sell, assign, transfer and deliver the Shares to be sold by such Selling
Stockholder in the manner provided herein and therein.
(d) This Agreement has been duly authorized,
executed and delivered by or on behalf of such Selling Stockholder.
(e) The Power of Attorney and Custody Agreement of
such Selling Stockholder has been duly authorized, executed and delivered by
such Selling Stockholder and is a valid and binding agreement of such Selling
Stockholder, enforceable in accordance with its terms and, pursuant to the power
of attorney conferred thereby, such Selling Stockholder has, among other things,
authorized the Attorney-In-Fact to execute and deliver on such Selling
Stockholder's behalf this Agreement and any other document that such Selling
Stockholder may deem necessary or desirable in connection with the transactions
contemplated hereby and thereby and to deliver the Shares to be sold by such
Selling Stockholder pursuant to this Agreement.
(f) Upon delivery of and payment for the Shares to
be sold by such Selling Stockholder pursuant to this Agreement, good and clear
title to such Shares will pass to the Underwriters, free of all restrictions on
transfer, liens, encumbrances, security interests, equities and claims
whatsoever.
(g) The execution, delivery and performance of this
Agreement and the Power of Attorney and Custody Agreement of such Selling
Stockholder by or on behalf of such Selling Stockholder, the compliance by such
Selling Stockholder with all the provisions hereof and thereof and the
consummation of the transactions contemplated hereby and thereby will not (i)
require any consent, approval, authorization or other order of, or qualification
with, any court or governmental body or agency (except such as may be required
under the securities or Blue Sky laws of the various states), (ii) conflict with
or constitute a breach of any of the terms or provisions of, or a default under,
the organizational documents of such Selling Stockholder, if such Selling
Stockholder is not an individual, or any indenture, loan agreement, mortgage,
lease or other agreement or instrument to which such Selling Stockholder is a
party or
14
15
by which such Selling Stockholder or any property of such Selling Stockholder is
bound or (iii) violate or conflict with any applicable law or any rule,
regulation, judgment, order or decree of any court or any governmental body or
agency having jurisdiction over such Selling Stockholder or any property of such
Selling Stockholder.
(h) The information in the Registration Statement
under the caption "Principal and Selling Stockholders" which specifically
relates to such Selling Stockholder does not, and will not on the Closing Date,
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading.
(i) At any time during the period described in
Section 5(d), if there is any change in the information referred to in Section
7(h), such Selling Stockholder will immediately notify you of such change.
(j) Each Selling Stockholder (i) has made an
independent investment decision with respect to its decision to offer and sell
the Shares of Common Stock set forth opposite its name on Schedule II hereto;
(ii) had, at the time of the consummation of the distribution of Common Stock of
the Company to stockholders of Pittway Corporation pursuant to the Combination
Agreement, no plan or intention to sell or otherwise dispose of any shares of
Common Stock or any other equity security of the Company; (iii) has no present
plan or intention to acquire shares of Common Stock or any other equity security
of the Company; and (iv) other than shares of Common Stock referred to in clause
(i) of this paragraph (i), has no present plan or intention to dispose of any
shares of Common Stock or any other equity security of the Company.
(k) Each certificate signed by or on behalf of such
Selling Stockholder and delivered to the Underwriters or counsel for the
Underwriters shall be deemed to be a representation and warranty by such Selling
Stockholder to the Underwriters as to the matters covered thereby.
SECTION 8. Indemnification. (a) The Company agrees to
indemnify and hold harmless each Underwriter, its directors, its officers and
each person, if any, who controls any Underwriter within the meaning of Section
15 of the Act or Section 20 of the Exchange Act, from and against any and all
losses, claims, damages, liabilities and judgments (including, without
limitation, any legal or other expenses incurred in connection with
investigating or defending any matter, including any action, that could give
rise to any such losses, claims, damages, liabilities or judgments) caused by
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement (or any amendment thereto), the Prospectus (or any
amendment or supplement thereto) or any preliminary prospectus, or caused by 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,
except insofar as such losses, claims, damages, liabilities or judgments are
caused by any such untrue statement or omission or alleged
15
16
untrue statement or omission based upon information relating to any Underwriter
furnished in writing to the Company by such Underwriter through you expressly
for use therein provided, however, that the foregoing indemnity agreement with
respect to any preliminary prospectus shall not inure to the benefit of any
Underwriter who failed to deliver a Prospectus, as then amended or supplemented,
(so long as the Prospectus and any amendment or supplement thereto was provided
by the Company to the several Underwriters in the requisite quantity and on a
timely basis to permit proper delivery on or prior to the Closing Date) to the
person asserting any losses, claims, damages, liabilities or judgments caused by
any untrue statement or alleged untrue statement of a material fact contained in
such preliminary prospectus, or caused by 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, if such material misstatement or omission
or alleged material misstatement or omission was cured in the Prospectus, as so
amended or supplemented, and such Prospectus was required by law to be delivered
at or prior to the written confirmation of sale to such person.
(b) The Selling Stockholders severally agree to
indemnify and hold harmless each Underwriter, its directors, its officers and
each person, if any, who controls any Underwriter within the meaning of Section
15 of the Act or Section 20 of the Exchange Act, to the same extent as the
foregoing indemnity from the Company to the Underwriters but only with reference
to information relating to such Selling Stockholder furnished in writing to the
Company or to the Underwriters by such Selling Stockholder expressly for use in
the Registration Statement (or any amendment thereto), the Prospectus (or any
amendment or supplement thereto) or any preliminary prospectus.
(c) Each Underwriter agrees, severally and not
jointly, to indemnify and hold harmless the Company, its directors, its officers
who sign the Registration Statement, each person, if any, who controls the
Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, each Selling Stockholder and each person, if any, who controls
such Selling Stockholder within the meaning of Section 15 of the Act or Section
20 of the Exchange Act to the same extent as the foregoing indemnity from the
Sellers to such Underwriter but only with reference to information relating to
such Underwriter furnished in writing to the Company by such Underwriter through
you expressly for use in the Registration Statement (or any amendment thereto),
the Prospectus (or any amendment or supplement thereto) or any preliminary
prospectus.
(d) In case any action shall be commenced involving
any person in respect of which indemnity may be sought pursuant to Section 8(a),
8(b) or 8(c) (the "INDEMNIFIED PARTY"), the indemnified party shall promptly
notify the person against whom such indemnity may be sought (the "INDEMNIFYING
PARTY") in writing and the indemnifying party shall assume the defense of such
action, including the employment of counsel reasonably satisfactory to the
indemnified party and the payment of all fees and expenses of such counsel, as
incurred (except that in the case of any action in respect of which indemnity
may be sought 16
17
pursuant to Sections 8(a), 8(b) and 8(c), the Underwriter shall not be required
to assume the defense of such action pursuant to this Section 8(d), but may
employ separate counsel and participate in the defense thereof, but the fees and
expenses of such counsel, except as provided below, shall be at the expense of
such Underwriter). Any indemnified party shall have the right to employ separate
counsel in any such action and participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of the indemnified party
unless (i) the employment of such counsel shall have been specifically
authorized in writing by the indemnifying party, (ii) the indemnifying party
shall have failed to assume the defense of such action or employ counsel
reasonably satisfactory to the indemnified party or (iii) the named parties to
any such action (including any impleaded parties) include both the indemnified
party and the indemnifying party, and the indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party (in which case the indemnifying party shall not have the
right to assume the defense of such action on behalf of the indemnified party).
In any such case, the indemnifying party shall not, in connection with any one
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for (i) the fees and expenses of more than one separate firm of attorneys
(in addition to any local counsel) for all Underwriters, their officers and
directors and all persons, if any, who control any Underwriter within the
meaning of either Section 15 of the Act or Section 20 of the Exchange Act, (ii)
the fees and expenses of more than one separate firm of attorneys (in addition
to any local counsel) for the Company, its directors, its officers who sign the
Registration Statement and all persons, if any, who control the Company within
the meaning of either such Section and (iii) the fees and expenses of more than
one separate firm of attorneys (in addition to any local counsel) for all
Selling Stockholders and all persons, if any, who control any Selling
Stockholder within the meaning of either such Section, and all such fees and
expenses shall be reimbursed as they are incurred. In the case of any such
separate firm for the Underwriters, their officers and directors and such
control persons of any Underwriters, such firm shall be designated in writing by
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation. In the case of any such
separate firm for the Company and such directors, officers and control persons
of the Company, such firm shall be designated in writing by the Company. In the
case of any such separate firm for the Selling Stockholders and such control
persons of any Selling Stockholders, such firm shall be designated in writing by
the Attorneys. The indemnifying party shall indemnify and hold harmless the
indemnified party from and against any and all losses, claims, damages,
liabilities and judgments by reason of any settlement of any action (i) effected
with its written consent or (ii) effected without its written consent if the
settlement is entered into more than twenty business days after the indemnifying
party shall have received a request from the indemnified party for reimbursement
for the fees and expenses of counsel (in any case where such fees and expenses
are at the expense of the indemnifying party) and, prior to the date of such
settlement, the indemnifying party shall have failed to comply with such
reimbursement request. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement or compromise of, or
consent to the entry of judgment with respect to, any pending or threatened
action in respect of which the indemnified party is or could have been a party
and indemnity or contribution may be
17
18
or could have been sought hereunder by the indemnified party, unless such
settlement, compromise or judgment (i) includes an unconditional release of the
indemnified party from all liability on claims that are or could have been the
subject matter of such action and (ii) does not include a statement as to or an
admission of fault, culpability or a failure to act, by or on behalf of the
indemnified party.
(e) To the extent the indemnification provided for
in this Section 8 is unavailable to an indemnified party or insufficient in
respect of any losses, claims, damages, liabilities or judgments referred to
therein, then each indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, claims, damages, liabilities and judgments (i) (A)
in such proportion as is appropriate to reflect the relative benefits received
by the Company and the Selling Stockholders on the one hand and the Underwriters
on the other hand from the offering of the Shares or (B) if the allocation
provided by clause 8(e)(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 8(e)(i) above but also the relative fault of the Company and the
Selling Stockholders on the one hand and the Underwriters on the other hand in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations or (ii) as between the Company on the one hand and each
Selling Stockholder on the other, or as among the Selling Stockholders, as the
case may be, in such proportion as is appropriate to reflect the relative fault
of the Company and of each Selling Stockholder in connection with such
statements or omissions, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Selling Stockholders on
the one hand and the Underwriters on the other hand shall be deemed to be in the
same proportion as the total net proceeds from the offering (after deducting
underwriting discounts and commissions, but before deducting expenses) received
by the Company and the Selling Stockholders, and the total underwriting
discounts and commissions received by the Underwriters, bear to the total price
to the public of the Shares, in each case as set forth in the table on the cover
page of the Prospectus. The relative fault of the Company and the Selling
Stockholders on the one hand and the Underwriters on the other hand 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 Selling
Stockholders on the one hand or the Underwriters on the other hand and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The Sellers and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 8(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 in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other
18
19
expenses incurred by such indemnified party in connection with investigating or
defending any matter, including any action, that could have given rise to such
losses, claims, damages, liabilities or judgments. Notwithstanding the
provisions of this Section 8, 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 to contribute pursuant to this Section 8(e) are
several in proportion to the respective number of Shares purchased by each of
the Underwriters hereunder and not joint.
(f) The remedies provided for in this Section 8 are
not exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
(g) Each Selling Stockholder hereby designates
[NAME OF COMPANY], [ADDRESS OF COMPANY], [SELLING STOCKHOLDERS PLEASE PROVIDE
INFORMATION] as its authorized agent, upon which process may be served in any
action which may be instituted in any state or federal court in the State of New
York by any Underwriter, any director or officer of any Underwriter or any
person controlling any Underwriter asserting a claim for indemnification or
contribution under or pursuant to this Section 8, and each Selling Stockholder
will accept the jurisdiction of such court in such action, and waives, to the
fullest extent permitted by applicable law, any defense based upon lack of
personal jurisdiction or venue. A copy of any such process shall be sent or
given to such Selling Stockholder, at the address for notices specified in
Section 12 hereof.
SECTION 9. Conditions of Underwriters' Obligations.
(1) The several obligations of the Underwriters to purchase
the Firm Shares under this Agreement are subject to the satisfaction of each of
the following conditions:
(a) All the representations and warranties of the Company
contained in this Agreement shall be true and correct on the date hereof and on
the Closing Date with the same force and effect as if made on and as of the
Closing Date.
(b) (i) If the Company is required to file a Rule 462(b)
Registration Statement after the effectiveness of this Agreement, such Rule
462(b) Registration Statement shall have become effective by 10:00 P.M., New
York City time, on the date of this Agreement; and (ii) no stop order suspending
the effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been commenced or shall be pending
before or contemplated by the Commission.
19
20
(c) You shall have received on the Closing Date a
certificate dated the Closing Date, signed by Xxxxxx X. Xxxx and Xxxxxx X.
XxXxxxxx, in their capacities as the Chief Executive Officer, and Chief
Financial Officer, respectively, of the Company, confirming the matters set
forth in Sections 6(t), 9(a) and 9(b) and that the Company has complied with all
of the agreements and satisfied all of the conditions herein contained and
required to be complied with or satisfied by the Company on or prior to the
Closing Date.
(d) Since the respective dates as of which information is
given in the Prospectus other than as set forth in the Prospectus (exclusive of
any amendments or supplements thereto subsequent to the date of this Agreement),
(i) there shall not have occurred any change or any development involving a
prospective change in the condition, financial or otherwise, or the earnings,
business, management or operations of the Company and its subsidiaries, taken as
a whole, (ii) there shall not have been any change or any development involving
a prospective change in the capital stock or in the long-term debt of the
Company or any of its subsidiaries and (iii) neither the Company nor any of its
subsidiaries shall have incurred any liability or obligation, direct or
contingent, the effect of which, in any such case described in clause 9(d)(i),
9(d)(ii) or 9(d)(iii), in your judgment, is material and adverse and, in your
judgment, makes it impracticable to market the Shares on the terms and in the
manner contemplated in the Prospectus.
(e) All the representations and warranties of each Selling
Stockholder contained in this Agreement shall be true and correct on the date
hereof and on the Closing Date with the same force and effect as if made on and
as of the Closing Date and you shall have received on the Closing Date a
certificate dated the Closing Date from each Attorney-In-Fact, on behalf of each
of the respective Selling Stockholders, to such effect and to the effect that
such Selling Stockholder has complied with all of the agreements and satisfied
all of the conditions herein contained and required to be complied with or
satisfied by such Selling Stockholder on or prior to the Closing Date.
(f) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for the Underwriters), dated the Closing Date,
of Xxxxx, Day, Xxxxxx & Xxxxx, counsel for the Company, to the effect that:
(i) 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
the corporate power and authority to carry on its business as described
in the Prospectus and to own, lease and operate its properties;
(ii) each of the Company and its subsidiaries is duly
qualified and is in good standing as a foreign corporation authorized
to do business in each jurisdiction in which the nature of its business
or its ownership or leasing of property requires such qualification,
except where the failure to be so
20
21
qualified would not have a material adverse effect on the business,
financial condition or results of operations of the Company and its
subsidiaries, taken as a whole;
(iii) all the outstanding shares of capital stock of
the Company (including the Shares to be sold by the Selling
Stockholders) have been duly authorized and validly issued and are
fully paid, non-assessable and not subject to any preemptive or similar
rights;
(iv) the Shares to be issued and sold by the Company
hereunder have been duly authorized and, when issued and delivered to
the Underwriters against payment therefor as provided by this
Agreement, will be validly issued, fully paid and non-assessable, and
the issuance of such Shares will not be subject to any preemptive or
similar rights;
(v) all of the outstanding shares of capital stock of
each of the Company's subsidiaries have been duly authorized and
validly issued and are fully paid and non-assessable, and are owned by
the Company, directly or indirectly through one or more subsidiaries,
free and clear of any security interest, claim, lien, encumbrance or
adverse interest of any nature;
(vi) this Agreement has been duly authorized, executed
and delivered by the Company;
(vii) the authorized capital stock of the Company
conforms as to legal matters to the description thereof contained in
the Prospectus;
(viii) the Registration Statement has become effective
under the Act, no stop order suspending its effectiveness has been
issued and no proceedings for that purpose are, to the best of such
counsel's knowledge after due inquiry, pending before or contemplated
by the Commission;
(ix) the statements under the caption "United States
Federal Income Tax Considerations to Non-U.S. Holders" in the
Prospectus, the description of the Company's capital stock set forth in
the Registration Statement on Form 8-A/A, dated March 30, 1999, and
incorporated by reference into the Prospectus, and Item 15 of Part II
of the Registration Statement, insofar as such statements constitute a
summary of the legal matters, documents or proceedings referred to
therein, fairly present the information called for with respect to such
legal matters, documents and proceedings;
21
22
(x) neither the Company nor any of its subsidiaries is
in violation of its respective charter or by-laws and, to the best of
such counsel's knowledge after due inquiry, neither the Company nor any
of its subsidiaries is in default in the performance of any obligation,
agreement, covenant or condition contained in the agreements listed as
Exhibits 2.1, 2.2, 4. and 10.1 through 10.16 to the Company's Annual
Report on Form 10-K for the year ended December 31, 1998;
(xi) the execution, delivery and performance of this
Agreement by the Company, the compliance by the Company with all the
provisions hereof and the consummation of the transactions contemplated
hereby will not (A) require any consent, approval, authorization or
other order of, or qualification with, any court or governmental body
or agency (except such as may be required under the securities or Blue
Sky laws of the various states or as may have been obtained prior to
the date hereof), (B) conflict with or constitute a breach of any of
the terms or provisions of, or a default under, the charter or by-laws
of the Company or any of its subsidiaries or any indenture, loan
agreement, mortgage, lease or other agreement or instrument that is
material to the Company and its subsidiaries, taken as a whole, to
which the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries or their respective property is
bound, (C) violate or conflict with any applicable law or any rule,
regulation, judgment, order or decree of any court or any governmental
body or agency having jurisdiction over the Company, any of its
subsidiaries or their respective property or (D) result in the
suspension, termination or revocation of any Authorization of the
Company or any of its subsidiaries or any other impairment of the
rights of the holder of any such Authorization;
(xii) after due inquiry, such counsel does not know of
any legal or governmental proceedings pending or threatened to which
the Company or any of its subsidiaries is or could be a party or to
which any of their respective property is or could be subject that are
required to be described in the Registration Statement or the
Prospectus and are not so described, or of any statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to
the Registration Statement that are not so described or filed as
required;
(xiii) the Company is not and, after giving effect to
the offering and sale of the Shares and the application of the proceeds
thereof as described in the Prospectus, will not be, an "investment
company" as such term is defined in the Investment Company Act of 1940,
as amended;
22
23
(xiv) to the best of such counsel's knowledge after
due inquiry, and except as otherwise disclosed in the Prospectus, there
are no contracts, agreements or understandings between the Company and
any person granting such person the right to require the Company to
file a registration statement under the Act with respect to any
securities of the Company or to require the Company to include such
securities with the Shares registered pursuant to the Registration
Statement;
(xv) (A) each document, if any, filed pursuant to the
Exchange Act and incorporated by reference in the Prospectus (except
for financial statements and other financial data included therein as
to which no opinion need be expressed) complied when so filed as to
form with the Act and the Exchange Act, (B) the Registration Statement
and the Prospectus and any supplement or amendment thereto (except for
the financial statements and other financial data included therein as
to which no opinion need be expressed) comply as to form with the Act,
(C) such counsel has no reason to believe that at the time the
Registration Statement became effective or on the date of this
Agreement, the Registration Statement and the prospectus included
therein (except for the financial statements and other financial data
as to which such counsel need not express any belief) contained any
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading and (D) such counsel has no reason to believe
that the Prospectus, as amended or supplemented, if applicable (except
for the financial statements and other financial data, as aforesaid)
contains any untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(xvi) to the best of such counsel's knowledge after
due inquiry, the Company and its subsidiaries own or possess, or can
acquire on reasonable terms, all patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names, Internet domain
names, designs, logos, slogans and general intangibles of like nature,
together with goodwill, and registrations and applications relating to
any of the foregoing, as applicable, ("INTELLECTUAL PROPERTY")
currently employed by them in connection with the business now operated
by them, except where the failure to own or possess or otherwise be
able to acquire such intellectual property would not, singly or in the
aggregate, have a material adverse effect on the business, prospects,
financial condition or results of operation of the Company and its
subsidiaries, taken as a whole; the intellectual property owned or used
by the Company or its subsidiaries has been duly maintained, is valid
and subsisting, in full force and effect, and has not been cancelled,
expired or abandoned; and
23
24
neither the Company nor any of its subsidiaries has received any notice
of infringement of or conflict with asserted rights of others with
respect to any of such intellectual property which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a material adverse effect on the business,
prospects, financial condition or results of operations of the Company
and its subsidiaries, taken as a whole, and neither the Company nor any
of its subsidiaries has knowledge of any basis for such claim.
The opinion of Xxxxx, Day, Xxxxxx & Xxxxx described in Section
9(f) above shall be rendered to you at the request of the Company and shall so
state therein.
(g) You shall have received on the Closing Date an
opinion (satisfactory to you and counsel for the Underwriters), dated
the Closing Date, of XxXxxxxxx, Will & Xxxxx, counsel for the Selling
Stockholders named in Part A of Schedule II (the "Xxxxxx
Stockholders"), to the effect that:
(i) this Agreement has been duly authorized,
executed and delivered by or on behalf of each Xxxxxx Stockholder;
(ii) each Xxxxxx Stockholder is the lawful owner
of the Shares to be sold by such Xxxxxx Stockholder pursuant to this
Agreement and has good and clear title to such Shares, free of all
restrictions on transfer, liens, encumbrances, security interests,
equities and claims whatsoever;
(iii) each Xxxxxx Stockholder has full legal
right, power and authority, and all authorization and approval required
by law, to enter into this Agreement and the Power of Attorney and
Custody Agreement of such Xxxxxx Stockholder and to sell, assign,
transfer and deliver the Shares to be sold by such Xxxxxx Stockholder
in the manner provided herein and therein;
(iv) the Power of Attorney and Custody Agreement
of each Xxxxxx Stockholder has been duly authorized, executed and
delivered by such Xxxxxx Stockholder and is a valid and binding
agreement of such Xxxxxx Stockholder, enforceable in accordance with
its terms, and, pursuant to the power of attorney conferred thereby,
such Xxxxxx Stockholder has, among other things, authorized the
Attorney-In-Fact, to execute and deliver on such Xxxxxx Stockholder's
behalf this Agreement and any other document such Xxxxxx Stockholder
may deem necessary or desirable in connection with the transactions
contemplated hereby and thereby and to deliver the Shares to be sold by
such Xxxxxx Stockholder pursuant to this Agreement;
(v) upon delivery of and payment for the Shares to
be sold by each Xxxxxx Stockholder pursuant to this Agreement, good and
clear title
24
25
to such Shares will pass to the Underwriters, free of all restrictions
on transfer, liens, encumbrances, security interests, equities and
claims whatsoever; and
(vi) the execution, delivery and performance of
this Agreement and the Power of Attorney and Custody Agreement of each
Xxxxxx Stockholder by such Xxxxxx Stockholder, the compliance by such
Xxxxxx Stockholder with all the provisions hereof and thereof and the
consummation of the transactions contemplated hereby and thereby will
not (A) require any consent, approval, authorization or other order of,
or qualification with, any court or governmental body or agency (except
such as may be required under the securities or Blue Sky laws of the
various states), (B) conflict with or constitute a breach of any of the
terms or provisions of, or a default under, the organizational
documents of such Xxxxxx Stockholder, if such Xxxxxx Stockholder is not
an individual, or any indenture, loan agreement, mortgage, lease or
other agreement or instrument to which such Xxxxxx Stockholder is a
party or by which any property of such Xxxxxx Stockholder is bound or
(C) violate or conflict with any applicable law or any rule,
regulation, judgment, order or decree of any court or any governmental
body or agency having jurisdiction over such Xxxxxx Stockholder or any
property of such Xxxxxx Stockholder.
The opinion of XxXxxxxxx, Will & Xxxxx described in Section
9(g) above shall be rendered to you at the request of the Xxxxxx Stockholders
and shall so state therein.
(h) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for the Underwriters), dated the Closing Date,
of Levenfeld, Pearlstein, counsel for the Selling Stockholders named in Part B
of Schedule II (the "WHI Stockholders"), to the effect that:
(i) this Agreement has been duly authorized, executed
and delivered by or on behalf of each WHI Stockholder;
(ii) each WHI Stockholder is the lawful owner of the
Shares to be sold by such WHI Stockholder pursuant to this Agreement
and has good and clear title to such Shares, free of all restrictions
on transfer, liens, encumbrances, security interests, equities and
claims whatsoever;
(iii) each WHI Stockholder has full legal right, power
and authority, and all authorization and approval required by law, to
enter into this Agreement and the Power of Attorney and Custody
Agreement of such WHI Stockholder and to sell, assign, transfer and
deliver the Shares to be sold by such WHI Stockholder in the manner
provided herein and therein;
25
26
(iv) the Power of Attorney and Custody Agreement of
each WHI Stockholder has been duly authorized, executed and delivered
by such WHI Stockholder and is a valid and binding agreement of such
WHI Stockholder, enforceable in accordance with its terms, and,
pursuant to the power of attorney conferred thereby, such WHI
Stockholder has, among other things, authorized the Attorney-In-Fact,
to execute and deliver on such WHI Stockholder's behalf this Agreement
and any other document such WHI Stockholder may deem necessary or
desirable in connection with the transactions contemplated hereby and
thereby and to deliver the Shares to be sold by such WHI Stockholder
pursuant to this Agreement;
(v) upon delivery of and payment for the Shares to be
sold by each WHI Stockholder pursuant to this Agreement, good and clear
title to such Shares will pass to the Underwriters, free of all
restrictions on transfer, liens, encumbrances, security interests,
equities and claims whatsoever; and
(vi) the execution, delivery and performance of this
Agreement and the Power of Attorney and Custody Agreement of each WHI
Stockholder by such WHI Stockholder, the compliance by such WHI
Stockholder with all the provisions hereof and thereof and the
consummation of the transactions contemplated hereby and thereby will
not (A) require any consent, approval, authorization or other order of,
or qualification with, any court or governmental body or agency (except
such as may be required under the securities or Blue Sky laws of the
various states), (B) conflict with or constitute a breach of any of the
terms or provisions of, or a default under, the organizational
documents of such WHI Stockholder, if such WHI Stockholder is not an
individual, or any indenture, loan agreement, mortgage, lease or other
agreement or instrument to which such WHI Stockholder is a party or by
which any property of such WHI Stockholder is bound or (C) violate or
conflict with any applicable law or any rule, regulation, judgment,
order or decree of any court or any governmental body or agency having
jurisdiction over such WHI Stockholder or any property of such WHI
Stockholder.
The opinion of Levenfeld, Xxxxxxxxxx described in Section 9(h)
above shall be rendered to you at the request of the WHI Stockholders and shall
so state therein.
(i) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for the Underwriters), dated the Closing Date,
of [ ], counsel for the Selling Stockholders named in Part C of Schedule II (the
"X-X Stockholders"), to the effect that:
(i) this Agreement has been duly authorized, executed
and delivered by or on behalf of each X-X Stockholder;
26
27
(ii) each X-X Stockholder is the lawful owner of the
Shares to be sold by such X-X Stockholder pursuant to this Agreement
and has good and clear title to such Shares, free of all restrictions
on transfer, liens, encumbrances, security interests, equities and
claims whatsoever;
(iii) each X-X Stockholder has full legal right, power
and authority, and all authorization and approval required by law, to
enter into this Agreement and the Power of Attorney and Custody
Agreement of such X-X Stockholder and to sell, assign, transfer and
deliver the Shares to be sold by such X-X Stockholder in the manner
provided herein and therein;
(iv) the Power of Attorney and Custody Agreement of
each X-X Stockholder has been duly authorized, executed and delivered
by such X-X Stockholder and is a valid and binding agreement of such
X-X Stockholder, enforceable in accordance with its terms, and,
pursuant to the power of attorney conferred thereby, such X-X
Stockholder has, among other things, authorized the Attorney-In-Fact,
to execute and deliver on such X-X Stockholder's behalf this Agreement
and any other document such X-X Stockholder may deem necessary or
desirable in connection with the transactions contemplated hereby and
thereby and to deliver the Shares to be sold by such X-X Stockholder
pursuant to this Agreement;
(v) upon delivery of and payment for the Shares to be
sold by each X-X Stockholder pursuant to this Agreement, good and clear
title to such Shares will pass to the Underwriters, free of all
restrictions on transfer, liens, encumbrances, security interests,
equities and claims whatsoever; and
(vi) the execution, delivery and performance of this
Agreement and the Power of Attorney and Custody Agreement of each X-X
Stockholder by such X-X Stockholder, the compliance by such X-X
Stockholder with all the provisions hereof and thereof and the
consummation of the transactions contemplated hereby and thereby will
not (A) require any consent, approval, authorization or other order of,
or qualification with, any court or governmental body or agency (except
such as may be required under the securities or Blue Sky laws of the
various states), (B) conflict with or constitute a breach of any of the
terms or provisions of, or a default under, the organizational
documents of such X-X Stockholder, if such X-X Stockholder is not an
individual, or any indenture, loan agreement, mortgage, lease or other
agreement or instrument to which such X-X Stockholder is a party or by
which any property of such X-X Stockholder is bound or (C) violate or
conflict with any applicable law or any rule, regulation, judgment,
order or decree of any court or any governmental body
27
28
or agency having jurisdiction over such X-X Stockholder or any property
of such X-X Stockholder.
The opinion of [ ] described in Section 9(i) above shall be
rendered to you at the request of the X-X Stockholders and shall so state
therein.
(j) You shall have received on the Closing Date an
opinion, dated the Closing Date, of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP,
counsel for the Underwriters, as to the matters referred to in Sections
9(f)(iv), 9(f)(vi) and 9(f)(ix) (but only with respect to the statements under
the caption "Underwriting" and with respect to the description of the Company's
capital stock set forth in the Registration Statement on Form 8A/A, dated March
30, 1999, and incorporated by reference into the Prospectus) and clauses
9(f)(xv)(B), 9(f)(xv)(C) and 9(f)(xv)(D).
In giving such opinions with respect to the matters covered by Section
9(f)(xv), Xxxxx, Day, Xxxxxx & Xxxxx may state that their opinion and belief are
based upon their participation in the preparation of the Registration Statement
and Prospectus and any amendments or supplements thereto and documents
incorporated therein by reference and review and discussion of the contents
thereof, but is without independent check or verification except as specified.
In giving such opinions with respect to the matters covered by clauses
9(f)(xv)(B), 9(f)(xv)(C) and 9(f)(xv)(D) above, Skadden, Arps, Slate, Xxxxxxx &
Xxxx LLP may state that their opinion and belief are based upon their
participation in the preparation of the Registration Statement and Prospectus
and any amendments or supplements thereto (other than documents incorporated
therein by reference) and review and discussion of the contents thereof
(including the documents incorporated therein by reference), but are without
independent check or verification except as specified.
(k) You shall have received, on each of the date hereof
and the Closing Date, a letter dated the date hereof or the Closing Date, as the
case may be, in form and substance satisfactory to you, from each of
PricewaterhouseCoopers LLP and Xxxxxx Xxxxxxxx LLP, independent public
accountants, containing the information and statements of the type ordinarily
included in accountants' "comfort letters" to Underwriters with respect to the
financial statements and certain financial information contained in or
incorporated by reference into the Registration Statement and the Prospectus.
(l) The Company shall have delivered to you the
agreements specified in Section 2 hereof which agreements shall be in full force
and effect on the Closing Date.
(m) The Shares shall have been duly listed on the NYSE.
(n) In order to document the Underwriters' compliance with
the reporting and withholdings provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 with respect to the transactions herein contemplated,
each Selling Stockholder will deliver to the
28
29
Representatives prior to or at the Closing a properly completed and executed
United States Treasury Department Form W-9 (or other applicable form or
statement specified by Treasury Department regulations in lieu thereof).
(o) The Company and the Selling Stockholders shall
not have failed on or prior to the Closing Date to perform or comply with any of
the agreements herein contained and required to be performed or complied with by
the Company or the Selling Stockholders, as the case may be, on or prior to the
Closing Date.
(2) The several obligations of the Underwriters to
purchase any Additional Shares hereunder are subject to the delivery to you on
the applicable Option Closing Date of the following documents:
(i) A Certificate, dated the Option Closing Date,
signed by Xxxxxx X. Xxxx and Xxxxxx X. XxXxxxxx, in their capacities as
Chief Executive Officer, and Chief Financial Officer, respectively, of
the Company, confirming that the certificate delivered at the Closing
Date pursuant to Section 9(c) hereof remains true and correct as of
such Option Closing Date.
(ii) A certificate, dated the Option Closing Date,
from each Attorney-In-Fact to the effect set forth in Section 9(e)
hereof, with respect to each Selling Stockholder.
(iii) An opinion (satisfactory to you and counsel for
the Underwriters), dated the Option Closing Date, of Xxxxx, Day, Xxxxxx
& Xxxxx, counsel for the Company, to the same effect as the opinions
required by Section 9(f) hereof, except with respect to the opinion
required by 9(f)(iv).
(iv) An opinion of XxXxxxxxx, Will & Xxxxx, counsel
for the Xxxxxx Stockholders, to the same effect as the opinions
required by Section 9(g) hereof.
(v) An opinion of Levenfeld, Pearlstein, counsel for
the WHI Stockholders, to the same effect as the opinions required by
Section 9(h) hereof.
(vi) An opinion of [ ], counsel for the X-X
Stockholders, to the same effect as the opinions required by Section
9(i) hereof.
(vii) An opinion of Skadden, Arps, Slate, Xxxxxxx &
Xxxx LLP, counsel for the Underwriters, to the same effect as the
opinions
29
30
required by Section 9(j) hereof, except with respect to the opinion
required by Section 9(f)(iv).
(viii) A letter, dated the Option Closing Date, from
each of PricewaterhouseCoopers LLP and Xxxxxx Xxxxxxxx LLP, independent
public accountants, substantially in the same form and substance as the
letters furnished pursuant to Section 9(k) hereof, except that the
"specified date" in the letters furnished pursuant to this paragraph
shall be a date not more than five days prior to such Option Closing
Date.
3. At the Closing Date and each Option Closing Date, counsel
for the Underwriters shall have been furnished with such documents and opinions
as they may reasonably require for the purpose of enabling them to pass upon the
sale of the Shares as herein contemplated, or in order to evidence the accuracy
of any of the representations or warranties, or the fulfillment of any of the
conditions, herein contained.
SECTION 10. Effectiveness of Agreement and Termination. This
Agreement shall become effective upon the execution and delivery of this
Agreement by the parties hereto.
This Agreement may be terminated at any time on or prior to
the Closing Date by you by written notice to the Sellers if any of the following
has occurred: (i) any outbreak or escalation of hostilities or other national or
international calamity or crisis or change in economic conditions or in the
financial markets of the United States or elsewhere that, in your judgment, is
material and adverse and, in your judgment, makes it impracticable to market the
Shares on the terms and in the manner contemplated in the Prospectus, (ii) the
suspension or material limitation of trading in securities or other instruments
on the NYSE, the American Stock Exchange, the Chicago Board of Options Exchange,
the Chicago Mercantile Exchange, the Chicago Board of Trade or the Nasdaq
National Market or limitation on prices for securities or other instruments on
any such exchange or the Nasdaq National Market, (iii) the suspension of trading
of any securities of the Company on any exchange or in the over-the-counter
market, (iv) the enactment, publication, decree or other promulgation of any
federal or state statute, regulation, rule or order of any court or other
governmental authority which in your opinion materially and adversely affects,
or will materially and adversely affect, the business, prospects, financial
condition or results of operations of the Company and its subsidiaries, taken as
a whole, (v) the declaration of a banking moratorium by either federal or New
York State authorities or (vi) the taking of any action by any federal, state or
local government or agency in respect of its monetary or fiscal affairs which in
your opinion has a material adverse effect on the financial markets in the
United States.
If on the Closing Date or on an Option Closing Date, as the
case may be, any one or more of the Underwriters shall fail or refuse to
purchase the Firm Shares or Additional Shares, as the case may be, which it has
or they have agreed to purchase hereunder on such date and the
30
31
aggregate number of Firm Shares or Additional Shares, as the case may be, which
such defaulting Underwriter or Underwriters agreed but failed or refused to
purchase is not more than one-tenth of the total number of Firm Shares or
Additional Shares, as the case may be, to be purchased on such date by all
Underwriters, each non-defaulting Underwriter shall be obligated severally, in
the proportion which the number of Firm Shares set forth opposite its name in
Schedule I bears to the total number of Firm Shares which all the non-defaulting
Underwriters have agreed to purchase, or in such other proportion as you may
specify, to purchase the Firm Shares or Additional Shares, as the case may be,
which such defaulting Underwriter or Underwriters agreed but failed or refused
to purchase on such date; provided that in no event shall the number of Firm
Shares or Additional Shares, as the case may be, which any Underwriter has
agreed to purchase pursuant to Section 2 hereof be increased pursuant to this
Section 10 by an amount in excess of one-ninth of such number of Firm Shares or
Additional Shares, as the case may be, without the written consent of such
Underwriter. If on the Closing Date any Underwriter or Underwriters shall fail
or refuse to purchase Firm Shares and the aggregate number of Firm Shares with
respect to which such default occurs is more than one-tenth of the aggregate
number of Firm Shares to be purchased by all Underwriters and arrangements
satisfactory to you, the Company and the Selling Stockholders for purchase of
such Firm Shares are not made within 48 hours after such default, this Agreement
will terminate without liability on the part of any non-defaulting Underwriter,
the Company or the Selling Stockholders. In any such case which does not result
in termination of this Agreement, either you or the Sellers shall have the right
to postpone the Closing Date, but in no event for longer than seven days, in
order that the required changes, if any, in the Registration Statement and the
Prospectus or any other documents or arrangements may be effected. If, on an
Option Closing Date, any Underwriter or Underwriters shall fail or refuse to
purchase Additional Shares and the aggregate number of Additional Shares with
respect to which such default occurs is more than one-tenth of the aggregate
number of Additional Shares to be purchased on such date, the non-defaulting
Underwriters shall have the option to (i) terminate their obligation hereunder
to purchase such Additional Shares or (ii) purchase not less than the number of
Additional Shares that such non-defaulting Underwriters would have been
obligated to purchase on such date in the absence of such default. Any action
taken under this paragraph shall not relieve any defaulting Underwriter from
liability in respect of any default of any such Underwriter under this
Agreement.
SECTION 11. Agreements of the Selling Stockholders. Each
Selling Stockholder agrees with you and the Company:
(a) To pay or to cause to be paid all transfer taxes
payable in connection with the transfer of the Shares to be sold by such Selling
Stockholder to the Underwriters.
(b) To do and perform all things to be done and
performed by such Selling Stockholder under this Agreement prior to the Closing
Date and to satisfy all conditions
31
32
precedent to the delivery of the Shares to be sold by such Selling Stockholder
pursuant to this Agreement.
SECTION 12. Miscellaneous. Notices given pursuant to any
provision of this Agreement shall be addressed as follows: (i) if to the
Company, to Penton Media, Inc., 0000 Xxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxx 00000,
(ii) if to the Xxxxxx Stockholders, to Xxxxxx Xxxxxxxx, c/o [ADDRESS OF
ATTORNEY-IN-FACT], (iii) if to the WHI Stockholders, to Xxxxxxx Xxxxxxx, c/o
[ADDRESS OF ATTORNEY-IN-FACT], (iv) if to the X-X Stockholders, to [
], c/o [ADDRESS OF ATTORNEY-IN-FACT], and (v) if to any
Underwriter or to you, to you c/x Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Syndicate
Department, or in any case to such other address as the person to be notified
may have requested in writing.
The respective indemnities, contribution agreements,
representations, warranties and other statements of the Company, the Selling
Stockholders and the several Underwriters set forth in or made pursuant to this
Agreement shall remain operative and in full force and effect, and will survive
delivery of and payment for the Shares, regardless of (i) any investigation, or
statement as to the results thereof, made by or on behalf of any Underwriter,
the officers or directors of any Underwriter, any person controlling any
Underwriter, the Company, the officers or directors of the Company, any person
controlling the Company, any Selling Stockholder or any person controlling such
Selling Stockholder, (ii) acceptance of the Shares and payment for them
hereunder and (iii) termination of this Agreement.
If for any reason the Shares are not delivered by or on behalf
of any Seller as provided herein (other than as a result of any termination of
this Agreement pursuant to Section 10), the Sellers agree, jointly and
severally, to reimburse the several Underwriters for all out-of-pocket expenses
(including the fees and disbursements of counsel) incurred by them.
Notwithstanding any termination of this Agreement, the Company shall be liable
for all expenses which it has agreed to pay pursuant to Section 5(i) hereof. The
Sellers also agree, jointly and severally, to reimburse the several
Underwriters, their directors and officers and any persons controlling any of
the Underwriters for any and all fees and expenses (including, without
limitation, the fees and disbursements of counsel) incurred by them in
connection with enforcing their rights hereunder (including, without limitation,
pursuant to Section 8 hereof).
Except as otherwise provided, this Agreement has been and is
made solely for the benefit of and shall be binding upon the Company, the
Selling Stockholders, the Underwriters, the Underwriters' directors and
officers, any controlling persons referred to herein, the Company's directors
and the Company's officers who sign the Registration Statement and their
respective successors and assigns, all as and to the extent provided in this
Agreement, and no other person shall acquire or have any right under or by
virtue of this Agreement. The term "successors and assigns" shall not include a
purchaser of any of the Shares from any of the several Underwriters merely
because of such purchase.
32
33
THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK INCLUDING, WITHOUT LIMITATION, SECTION
5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
This Agreement may be signed in various counterparts which
together shall constitute one and the same instrument.
33
34
Please confirm that the foregoing correctly sets forth the
agreement among the Company, the Selling Stockholders and the several
Underwriters.
Very truly yours,
PENTON MEDIA, INC.
By:
--------------------------------
Name:
Title:
THE SELLING STOCKHOLDERS NAMED
IN SCHEDULE II HERETO, ACTING
SEVERALLY
By:
--------------------------------
Name:
Attorney-In-Fact for the Selling
Stockholders listed in Parts A and B of
Schedule II hereto
By:
--------------------------------
Name:
Attorney-In-Fact for the Selling
Stockholders listed in Part C of Schedule II
hereto
S - 1
35
Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation
Xxxxxxx Xxxxx Barney, Inc.
Bear Xxxxxxx & Co. Inc.
Xxxxxxx Xxxxx, Xxxxxx Xxxxxx & Xxxxx
Incorporated
Acting severally on behalf of
themselves and the several
Underwriters named in
Schedule I hereto
By XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
By:
-----------------------------
Name:
Title:
S - 2
36
SCHEDULE I
----------
Number of Firm Shares
Underwriters to be Purchased
------------ ---------------
Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation.............................
Xxxxxxx Xxxxx Barney Inc..............................
Bear, Xxxxxxx & Co. Inc...............................
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated.....................
Total........................................ 7,778,000
I - 1
37
SCHEDULE II
-----------
Selling Stockholders
--------------------
Name Number of Firm Number of Additional
---- Shares Being Sold Shares Being Sold
----------------- -----------------
Part A - Xxxxxx Stockholders
----------------------------
Part B - WHI Stockholders
-------------------------
Part C - X-X Stockholders
-------------------------
Total............................ 7,778,000 1,166,700
========= =========
II - 1
38
SCHEDULE III
------------
Lock-Up Agreements
------------------
Xxxxxx X. Xxxx
Xxxxxx X. Xxxxxxx
Xxxxxx X. XxXxxxxx
Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxx
Xxxxxxx X. Vice
Xxxxxxx X. Xxxxxxxxx
Xxxxxxx Xxxxx
Xxxxxxx X. Friend
Xxxx X. Xxxxxx
Xxx X. Xxxxxxx
Xxxxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxx
III - 1
