EXHIBIT 1.1
5,000,000 Shares
XXXXXX XXXXXXXXXX TECHNOLOGIES, INC.
Common Stock
UNDERWRITING AGREEMENT
----------------------
September 28, 2000
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
XXXXXXX LYNCH, PIERCE,
XXXXXX & XXXXX INCORPORATED
BANC OF AMERICA SECURITIES LLC
U.S. BANCORP XXXXX XXXXXXX INC.
DLJdirect INC.
As representatives of the several Underwriters
named in Schedule I hereto
c/x Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Xxxxxx Xxxxxxxxxx Technologies, Inc., a Delaware corporation (the
"COMPANY"), proposes to issue and sell 5,000,000 shares of its common stock, par
value $.001 per share (the "FIRM SHARES"), to the several underwriters named in
Schedule I hereto (the "UNDERWRITERS"). The Company also proposes to issue and
sell to the several Underwriters not more than an additional 750,000 shares of
the common stock, par value $.001 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."
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 regulations of the Commission thereunder
(collectively, the "ACT"), a registration statement on Form S-1, 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". 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.
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, the Company agrees to issue and sell, and
each Underwriter agrees, severally and not jointly, to purchase from the Company
at a price per Share of $14.88 (the "PURCHASE PRICE") the number of Firm Shares
set forth opposite the name of such Underwriter in Schedule I hereto.
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to issue
and sell the Additional Shares and the Underwriters shall have the right to
purchase, severally and not jointly, up to 750,000 Additional Shares from the
Company 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 Company within 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 any
Additional Shares are to be purchased, each Underwriter, severally and not
jointly, agrees to purchase from the Company 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 Company 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.
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The Company 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 180 days after the date of the Prospectus without the prior written
consent of Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation. Notwithstanding
the foregoing, during such period (i) the Company may grant stock options
pursuant to the Company's existing stock option plans and (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. 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 180 days after the date of the Prospectus without
the prior written consent of Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities
Corporation. The Company shall, prior to or concurrently with the execution of
this Agreement, deliver an agreement executed by (i) each of the directors and
officers of the Company and (ii) each stockholder listed on Annex I hereto to
the effect that such person will not, during the period commencing on the date
such person signs such agreement and ending 180 days after the date of the
Prospectus, without the prior written consent of Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities Corporation, (A) engage in any of the transactions described in the
first sentence of this paragraph or (B) 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 hereby confirms its engagement of Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated ("XXXXXXX XXXXX") as, and Xxxxxxx Xxxxx hereby
confirms its agreement with the Company to render services as, a "qualified
independent underwriter," within the meaning of Section (b)(15) of Rule 2720 of
the Conduct Rules of the National Association of Securities Dealers, Inc. (the
"NASD") with respect to the offering and sale of the Shares. Xxxxxxx Xxxxx,
solely in its capacity as qualified independent underwriter and not otherwise,
is referred to herein as the "QIU." As compensation for the services of the QIU
hereunder, the Company agrees to pay the QIU $5,000 on the Closing Date. The
price at which the Shares will be sold to the public shall not be higher than
the maximum price recommended by Xxxxxxx Xxxxx acting as QIU.
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SECTION 3. Terms of Public Offering. The Company is advised by you that
the Underwriters propose to (i) 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 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 Xxxxxxx Xxxxx 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 Company shall deliver the Shares,
with any transfer taxes thereon duly paid by the respective Sellers, to Xxxxxxx
Xxxxx through the facilities of The Depository Trust Company ("DTC"), for the
respective accounts of the several Underwriters, against payment to the Company
of the Purchase Price therefore 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
October 4, 2000 or such other time on the same or such other date as Xxxxxxx
Xxxxx and the Company shall agree in writing. The time and date of delivery 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 Xxxxxxx Xxxxx and the Company shall agree
in writing. The time and date of delivery for the Additional Shares are
hereinafter referred to as an "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 8 of this Agreement
shall be delivered at the offices of Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.,
000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, 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.
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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 the Shares for offering or 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 with six signed copies of the Registration
Statement as first filed with the Commission and of each amendment to it,
including all exhibits, 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, 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
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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)
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 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
September 30, 2001 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
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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 its obligations under this Agreement,
including: (i) the fees, disbursements and expenses of the Company's counsel and
the Company's accountants 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 the Shares to the Underwriters, including any transfer
or other taxes payable thereon, (iii) all costs of printing or producing 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), (v) the filing fees and disbursements of counsel
for the Underwriters in connection with the review and clearance of the offering
of the Shares by the NASD, (vi) all fees and expenses in connection with the
preparation and filing of the registration statement on Form 8-A relating to the
Common Stock and all costs and expenses incident to the listing of the Shares on
the New York Stock Exchange, Inc. (the "NYSE"), (vii) the cost of printing
certificates representing the Shares, (viii) the costs and charges of any
transfer agent, registrar and/or depositary, (ix) the fees and expenses of the
QIU (including the fees and disbursements of counsel to the QIU) and (x) all
other costs and expenses incident to the performance of the obligations of the
Company hereunder for which provision is not otherwise made in this Section.
(j) To use its best efforts to list, subject to notice of issuance,
the Shares on the NYSE and to maintain the listing of the Shares on the NYSE for
a period of three years after the date of this Agreement.
(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 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.
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(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.
(b) (i) 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, (ii) 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,
(iii) 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 (iv)
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.
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(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 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 Registration
Statement.
(f) All the outstanding shares of capital stock of the Company 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 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.
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(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), (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 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 (including, without limitation, laws relating to the
Food and Drug Administration), the environment or hazardous or toxic substances
or wastes, pollutants or contaminants ("ENVIRONMENTAL LAWS"), any provisions of
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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 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.
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(p) Deloitte & Touche LLP are independent public accountants with
respect to the Company and its subsidiaries as required by the Act.
(q) The consolidated financial statements included 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) 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.
(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.
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(u) 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.
(v) The Company owns or possesses, or can acquire on reasonable terms,
all patents, 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 and
trade names (collectively, "INTELLECTUAL PROPERTY") currently employed by it in
connection with the business now operated by it, 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 the
Company is not infringing or conflicting 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.
SECTION 7. 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
Securities Exchange Act of 1934, as amended (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 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, provided by the Company to the several Underwriters in
the requisite quantity and on a timely basis to permit proper delivery on or
13
prior to the Closing Date) to the person asserting any losses, claims, damages
and liabilities and judgments caused by any untrue statement or alleged untrue
statement of a material fact contained in 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, if
such material misstatement or omission or alleged material misstatement or
omission was cured in such Prospectus and such Prospectus was required by law to
be delivered at or prior to the written confirmation of sale to such person.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company 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 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.
(c) In case any action shall be commenced involving any person in
respect of which indemnity may be sought pursuant to Section 7(a) or 7(b) (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 pursuant
to both Sections 7(a) and 7(b), the Underwriter shall not be required to assume
the defense of such action pursuant to this Section 7(c), 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
14
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 the fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for all indemnified parties and all such fees and
expenses shall be reimbursed as they are incurred. Such firm shall be designated
in writing by Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation and Xxxxxxx
Xxxxx, in the case of parties indemnified pursuant to Section 7(a), and by the
Company, in the case of parties indemnified pursuant to Section 7(b). 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 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.
(d) To the extent the indemnification provided for in this Section 7
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) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the offering
of the Shares or (ii) if the allocation provided by clause 7(d)(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 7(d)(i) above but also the
relative fault of the Company 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
15
equitable considerations. The relative benefits received by the Company 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 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 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
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7(d) 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 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 7, 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 7(d) are several in proportion to the respective number
of Shares purchased by each of the Underwriters hereunder and not joint.
(e) The remedies provided for in this Section 7 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.
SECTION 8. Indemnification of QIU.
16
(a) The Company agrees to indemnify and hold harmless the QIU, its
directors, its officers and each person, if any, who controls the QIU 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 defending or investigating any matter, including any action that
could give rise to any such losses, claims, damages, liabilities or judgments)
related to, based upon or arising out of (i) 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 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 or (ii) the QIU's activities as QIU under its
engagement pursuant to Section 2 hereof.
(b) In case any action shall be commenced involving any person in
respect of which indemnity may be sought pursuant to paragraph (a) of this
Section 8 (THE "QIU INDEMNIFIED PARTY"), the QIU Indemnified Party shall
promptly notify the Company in writing and the Company shall assume the defense
of such action, including the employment of counsel reasonably satisfactory to
the QIU Indemnified Party and the payment of all fees and expenses of such
counsel, as incurred. Any QIU 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 QIU
Indemnified Party unless (i) the employment of such counsel shall have been
specifically authorized in writing by the Company, (ii) the Company shall have
failed to assume the defense of such action or employ counsel reasonably
satisfactory to the QIU Indemnified Party or (iii) the named parties to any such
action (including any impleaded parties) include both the QIU Indemnified Party
and the Company, and the QIU 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 Company (in which case
the Company shall not have the right to assume the defense of such action on
behalf of the QIU Indemnified Party). In any such case, the Company 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 the fees and expenses of more than
one separate firm of attorneys (in addition to any local counsel) for all QIU
Indemnified Parties, which firm shall be designated by the QIU, and all such
fees and expenses shall be reimbursed as they are incurred. The Company shall
indemnify and hold harmless the QIU 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 ten
17
business days after the Company shall have received a request from the QIU
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 Company) and, prior
to the date of such settlement, the Company shall have failed to comply with
such reimbursement request. The Company shall not, without the prior written
consent of the QIU 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 QIU Indemnified Party is or could have been a
party and indemnity or contribution may be or could have been sought hereunder
by the QIU Indemnified Party, unless such settlement, compromise or judgment (i)
includes an unconditional release of the QIU 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 QIU Indemnified Party.
(c) To the extent the indemnification provided for in this Section 8 is
unavailable to a QIU Indemnified Party or insufficient in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then the Company,
in lieu of indemnifying such QIU Indemnified Party, shall contribute to the
amount paid or payable by such QIU Indemnified Party as a result of such losses,
claims, damages, liabilities and judgments (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the QIU on the other hand from the offering of the Shares or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and
the QIU 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. The relative benefits received by the Company and the
QIU shall be deemed to be in the same proportion as the total net proceeds from
the offering (before deducting expenses) received by the Company as set forth in
the table on the cover page of the Prospectus, and the fee received by the QIU
pursuant to Section 2 hereof, bear to the sum of such total net proceeds and
such fee. The relative fault of the Company and the QIU 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 QIU and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The Company and the QIU agree that it would not be just and equitable
if contribution pursuant to this Section 8(c) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
18
The amount paid or payable by a QIU 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 expenses incurred by such QIU Indemnified Party
in connection with investigating or defending any matter that could have given
rise to such losses, claims, damages, liabilities or judgments. In no event
shall any QIU Indemnified Party be required to contribute in the aggregate an
amount exceeding the fee received by the QIU pursuant to Section 2 hereof. 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.
(d) 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
QIU Indemnified Party at law or in equity.
SECTION 9. Conditions of Underwriters' Obligations. 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 Closing Date with the same force
and effect as if made on and as of the Closing Date.
(b) 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 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.
(c) You shall have received on the Closing Date a certificate dated
the Closing Date, signed by Xxxxxx X. Xxxxxxx and Xxxxx X. XxXxxxxx, in their
capacities as Vice President, Finance and Treasurer and Vice President,
Administration and Secretary, 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
19
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) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for the Underwriters), dated the Closing Date,
of Weil, Gotshal & Xxxxxx LLP counsel for the Company, to the effect that:
(i) each of the Company and Xxxxxx Xxxxxxxxxx Ltd., a New
York corporation, WGL Intermediate Holdings, Inc., a Delaware
corporation, and Xxxxxxxxxx-Xxxxxxx, Inc., a Delaware corporation
(each a "Subsidiary" and collectively the "Subsidiaries") is a
corporation validly existing and in good standing under the laws of
the State of its respective incorporation and has all requisite
corporate power and authority to own, lease and operate its properties
and to carry on its business as described in the Prospectus;
(ii) each of the Company and each Subsidiary is duly
qualified to transact business and is in good standing as a foreign
corporation authorized to do business in each jurisdiction identified
in Schedule A to the opinion;
(iii) all of the outstanding shares of capital stock of the
Company are duly authorized, validly issued, fully paid and
non-assessable and have not been issued in violation of any preemptive
or similar rights pursuant to law or in the Company's Certificate of
Incorporation;
(iv) the shares of common stock to be issued pursuant to
this Agreement have been duly authorized and, when issued as
contemplated by this Agreement, will be validly issued, fully paid and
non-assessable and free of preemptive or similar rights pursuant to
law or in the Company's Certificate of Incorporation;
20
(v) all of the outstanding shares of capital stock of WGL
Intermediate Holdings, Inc. are owned of record by the Company. All of
the outstanding shares of capital stock of Xxxxxx Xxxxxxxxxx Ltd. are
owned of record by WGL Intermediate Holdings, Inc. All of the
outstanding shares of Xxxxxxxxxx-Xxxxxxx, Inc. are owned of record by
Xxxxxx Xxxxxxxxxx Ltd. To such counsel's knowledge, such shares are
also owned beneficially by the respective record owners thereof and
are free and clear of all adverse claims, limitations on voting
rights, options and other encumbrances. Such shares are duly
authorized, validly issued, fully paid and non-assessable, except as
provided by Section 630 of the New York Business Corporation Law with
respect to Xxxxxx Xxxxxxxxxx Ltd., and have not been issued in
violation of (A) any preemptive rights pursuant to law, (B) any of the
Subsidiaries' Certificates of Incorporation or (C) to such counsel's
knowledge, any contractual preemptive rights;
(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, and such counsel is not aware of any stop order suspending
the effectiveness of the Registration Statement. To such counsel's
knowledge, after consultation with representatives of the Commission,
no proceedings therefor have been initiated or overtly threatened by
the Commission;
(ix) the statements (A) in the Prospectus under the captions
"Risk Factors", "Management's Discussion and Analysis of Financial
Condition and Results of Operations", "Business", "Management",
"Related Party Transactions", "Description of Capital Stock", "Shares
Eligible for Future Sale" and "Underwriting" and (B) in the
Registration Statement in response to the requirements of Items 14 and
15 of Part II, in each case insofar as such statements constitute
summaries of the legal matters, documents or proceedings referred to
therein, except as pertaining to matters of intellectual property
(including without limitation matters of patents, licenses and trade
secrets), fairly present the information called for with respect to
such legal matters, documents and proceedings and fairly summarize the
matters referred to therein in all material respects;
(x) 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
21
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
federal or state 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, (i) the Certificate of
Incorporation or By-Laws of the Company or any Subsidiary or (ii) any
agreements filed as exhibits to the Registration Statement, that is
material to the Company and its Subsidiaries, taken as a whole, to
which the Company or any Subsidiary is a party or by which the Company
or any Subsidiary or their respective property is bound, or (C)
violate or conflict with any (i) applicable New York, Delaware
corporate or federal law, rule or regulation or (ii) judgment, order
or decree of any court, governmental body or agency having
jurisdiction over the Company, any of its Subsidiaries or their
respective property of which we are aware;
(xi) to such counsel's knowledge, there are no legal or
governmental proceedings pending or overtly threatened to which the
Company or any Subsidiary is a party or to which any of the properties
of the Company or any Subsidiary is subject that are required to be
described in the Registration Statement or the Prospectus and are not
so described or any 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;
(xii) 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" under the Investment Company Act of 1940, as amended, and the
rules and regulations promulgated by the Commission thereunder;
(xiii) to such counsel's knowledge, after due inquiry,
except as 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; and
(xiv) such counsel has participated in conferences with
directors, officers and other representatives of the Company,
representatives of the independent public accountants for the Company,
representatives of the Underwriters and representatives of counsel for
the Underwriters, at which conferences the contents of the
22
Registration Statement and the Prospectus and related matters were
discussed, and, although such counsel has not independently verified
and is not passing upon and assumes no responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement and Prospectus (except to the extent specified
in the foregoing opinion), no facts have come to such counsel's
attention which lead such counsel to believe that the Registration
Statement, on the effective date thereof, contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
contained therein not misleading or that the Prospectus, on the date
thereof or on the date hereof, contained or contains an untrue
statement of a material fact or omitted or omits to state a material
fact required to be stated therein or necessary to make the statements
contained therein, in light of the circumstances under which they were
made, not misleading (it being understood that such counsel expresses
no view with respect to the financial statements and related notes,
the financial statement schedules and the other financial and
accounting data included in the Registration Statement or Prospectus).
The opinion of Weil, Gotshal & Xxxxxx LLP described in Section 9(e)
above shall be rendered to you at the request of the Company and shall so state
therein.
(f) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for the Underwriters), dated the Closing Date,
of Xxxxxxx, Xxxx, Xxxxxxx, Xxxxx & Goodyear LLP, local counsel for the Company,
to the effect that:
(i) there have come to such counsel's attention no facts
that lead such counsel to believe that the Registration Statement or
that the Prospectus contains an untrue statement of a material fact or
omits to state a material fact required to be stated therein or
necessary to make the statements contained therein, in light of the
circumstances under which they were made, not misleading, with respect
to (1) any Intellectual Property of the Company or (2) any license
agreement relating to any Intellectual Property of the Company;
(ii) such counsel has no knowledge that, other than as
stated in the Registration Statement and the Prospectus, there is any
material pending or threatened action against the Company relating to
(1) any Intellectual Property of the Company or (2) any license
agreement relating to any Intellectual Property of the Company;
23
(iii) such counsel has no knowledge that the Company does
not take measures that the Company reasonably believes to be adequate
to prevent material adverse effects upon the Company by creating,
maintaining, protecting, and realizing reasonable value from the
material Intellectual Property of the Company and from current
material license and other agreements between the Company and others;
(iv) such counsel has no knowledge that any license
agreement listed as an Exhibit in the Registration Statement was not
duly executed or is not valid in accordance with its terms or that the
Company is in default (declared or undeclared), except as otherwise
disclosed, in connection with any material provision of any such
license agreement, and there have come to such counsel's attention no
facts that lead such counsel to believe that any such license
agreement to which the Company is a party is not enforceable;
(v) such counsel has no knowledge that, other than as stated
in the Registration Statement and the Prospectus, there is any pending
or threatened legal proceeding asserting a material breach or default
by the Company relating to (1) any Intellectual Property of the
Company or (2) any license agreement relating to any Intellectual
Property of the Company;
(vi) such counsel has no knowledge that the Company does not
possess the Intellectual Property and licenses to Intellectual
Property that are currently believed by the Company to be necessary
for the conduct of the business of the Company as described in the
Registration Statement and the Prospectus;
(vii) such counsel has no knowledge, that the Company is not
an owner of record in the appropriate governmental agency of any
Intellectual Property of the Company that is currently believed by the
Company to be necessary for the conduct of the business, of the
Company as described in the Registration Statement and the Prospectus
and for which the Company does not otherwise hold rights through an
express license or agreement;
(viii) such counsel has no knowledge that any Intellectual
Property of the Company currently believed by the Company to be
necessary for the conduct of the business of the Company as described
in the Registration Statement and the Prospectus is unenforceable or
invalid owing to a statutory bar arising out of the acts or omissions
24
of the Company, or that any lien has been filed against any such
Intellectual Property;
(ix) the statements under the subcaption "Patents and
Proprietary Technology", under the caption "Business" in the
Prospectus, 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 referred to therein in all material
respects.
The opinion of Xxxxxxx, Xxxx, Xxxxxxx, Xxxxx & Goodyear LLP 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, dated the
Closing Date, of Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P., counsel for the
Underwriters, as to the matters referred to in Sections 9(e)(iv), 9(e)(vi),
9(e)(ix) (but only with respect to the statements under the caption "Description
of Capital Stock" and "Underwriting") and 9(e)(xiv).
In giving such opinions with respect to the matters covered by Section
9(e)(xvii), Weil, Gotshal & Xxxxxx LLP and Akin, Gump, Strauss, Xxxxx & Xxxx,
L.L.P. 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 review and discussion of the
contents thereof, but are without independent check or verification except as
specified.
(h) 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 Deloitte & Touche 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 the Registration Statement and the Prospectus.
(i) 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.
(j) The Shares shall have been duly listed, subject to notice of
issuance, on the NYSE.
(k) The Company 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 on or prior to the Closing Date.
25
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 such documents as you may reasonably request with respect to the
good standing of the Company, the due authorization and issuance of such
Additional Shares and other matters related to the issuance of such Additional
Shares.
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 Company 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 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
26
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
and the Company 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 and the Company. In any such case which does
not result in termination of this Agreement, either you or the Company 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. Miscellaneous. Notices given pursuant to any provision of
this Agreement shall be addressed as follows: (i) if to the Company, to Xxxxxx
Xxxxxxxxxx Technologies, Inc., 10,000 Xxxxxx Xxxxx, Xxxxxxxx, Xxx Xxxx, 00000
and (ii) 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 and the several Underwriters set
forth in or made pursuant to this Agreement shall remain operative and in full
27
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 QIU Indemnified Party,
the Company, the officers or directors of the Company or any person controlling
the Company, (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 the
Company as provided herein (other than as a result of any termination of this
Agreement pursuant to Section 10), the Company agrees 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 Company also agrees 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 disbursements of counsel) incurred by them in connection
with enforcing their rights hereunder (including, without limitation, pursuant
to Sections 7 and 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
Underwriters, the Underwriters' directors and officers, any controlling persons
referred to herein, the QIU Indemnified Party, 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.
This Agreement shall be governed and construed in accordance with the
laws of the State of New York.
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
28
Please confirm that the foregoing correctly sets forth the agreement
between the Company and the several Underwriters.
Very truly yours,
XXXXXX XXXXXXXXXX TECHNOLOGIES, INC.
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chairman, President & CEO
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
XXXXXXX LYNCH, PIERCE,
XXXXXX & XXXXX INCORPORATED
BANC OF AMERICA SECURITEIS LLC
U.S. BANCORP XXXXX XXXXXXX, INC.
DLJdirect INC.
Acting severally on behalf of
themselves and the several
Underwriters named in
Schedule I hereto
By XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
By: /s/ Xxxxxxx Xxxxxxxxxx
-----------------------------
Name: Xxxxxxx Xxxxxxxxxx
Title: Senior Vice President
SCHEDULE I
----------
------------------------------------------------------------ ----------------
UNDERWRITERS NUMBER OF
SHARES
------------------------------------------------------------ ----------------
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation 1,146,000
------------------------------------------------------------ ----------------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated 1,146,000
------------------------------------------------------------ ----------------
Banc of America Securities LLC 764,000
------------------------------------------------------------ ----------------
U.S. Bancorp Xxxxx Xxxxxxx Inc. 764,000
------------------------------------------------------------ ----------------
DLJdirect Inc. 100,000
------------------------------------------------------------ ----------------
Bear, Xxxxxxx & Co. Inc. 40,000
------------------------------------------------------------ ----------------
CIBC World Markets Corp. 40,000
------------------------------------------------------------ ----------------
Chase Securities Inc. 40,000
------------------------------------------------------------ ----------------
Credit Suisse First Boston Corporation 40,000
------------------------------------------------------------ ----------------
Deutsche Bank Securities Inc. 40,000
------------------------------------------------------------ ----------------
X.X. Xxxxxxx & Sons, Inc. 40,000
------------------------------------------------------------ ----------------
First Union Securities, Inc. 40,000
------------------------------------------------------------ ----------------
Xxxxxxx, Sachs & Co. 40,000
------------------------------------------------------------ ----------------
HSBC Securities (USA) Inc. 40,000
------------------------------------------------------------ ----------------
Xxxxxx Xxxxxxx & Co. Incorporated 40,000
------------------------------------------------------------ ----------------
PaineWebber Incorporated 40,000
------------------------------------------------------------ ----------------
Prudential Securities Incorporated 40,000
------------------------------------------------------------ ----------------
Xxxxxxx Xxxxx Barney Inc. 40,000
------------------------------------------------------------ ----------------
Xxxxxx Xxxxxx Partners LLC 40,000
------------------------------------------------------------ ----------------
Xxxxxx X. Xxxxx & Co. Incorporated 20,000
------------------------------------------------------------ ----------------
Xxxxxx X. Xxxx & Company 20,000
------------------------------------------------------------ ----------------
Xxxxxxx Securities Inc. 20,000
------------------------------------------------------------ ----------------
Xxxxxxx, Xxxxxx & Co. 20,000
------------------------------------------------------------ ----------------
Xxxxxxxxxx & Co. Inc. 20,000
------------------------------------------------------------ ----------------
Xxxxxx Xxxxxx Xxxxxxxx & Co., Inc. 20,000
------------------------------------------------------------ ----------------
Gruntal & Co., L.L.C. 20,000
------------------------------------------------------------ ----------------
Xxxxxx Xxxxxxxxxx Xxxxx LLC 20,000
------------------------------------------------------------ ----------------
Xxxxxxxx, Lemon & Co. Incorporated 20,000
------------------------------------------------------------ ----------------
X.X. Xxxx & Associates, Inc. 20,000
------------------------------------------------------------ ----------------
Ladenburg Xxxxxxxx & Co. Inc. 20,000
------------------------------------------------------------ ----------------
McDonald Investments Inc., A KeyCorp Company 20,000
------------------------------------------------------------ ----------------
Xxxxxxx & Company, Inc. 20,000
------------------------------------------------------------ ----------------
Xxxxxx/Hunter Incorporated 20,000
------------------------------------------------------------ ----------------
Pennsylvania Merchant Group 20,000
------------------------------------------------------------ ----------------
Xxxxx XxxXxxxxx Incorporated 20,000
------------------------------------------------------------ ----------------
Xxxxxxx Xxxxx & Associates, Inc. 20,000
------------------------------------------------------------ ----------------
The Xxxxxxxx-Xxxxxxxx Company, LLC 20,000
------------------------------------------------------------ ----------------
Xxxxxxx Xxxxxx Xxxxxx 20,000
------------------------------------------------------------ ----------------
Sands Brothers & Co., Ltd. 20,000
------------------------------------------------------------ ----------------
Xxxxxxxx Inc. 20,000
------------------------------------------------------------ ----------------
------------------------------------------------------------ ----------------
Sutro & Co. Incorporated 20,000
------------------------------------------------------------ ----------------
Xxxxxx Xxxxxxx Incorporated 20,000
------------------------------------------------------------ ----------------
X.X. Xxxxxxxxx, Towbin 20,000
------------------------------------------------------------ ----------------
Wachovia Securities, Inc. 20,000
------------------------------------------------------------ ----------------
The Xxxxxxxx Capital Group, L.P. 20,000
============================================================ ================
TOTAL 5,000,000
------------------------------------------------------------ ----------------
Annex I
o Xxxxxx Xxxxxxxx
o Xxxx Xxxxxxxx
o Xxxxxxxx Xxxxxxxx
o Xxxxx Xxxxxxxx
o Xxx X. Xxxxxxxx
o Xxxxxxx Xxxxx
o Xxxxx X. Xxxxxxx
o Xxxxxxx Xxxxx
o Xxxxxx Xxxxxx
o Xxxxx X. Xxxxxxxxxx
o Xxxxx X. XxXxxxxx
o Xxxx Xxxxxx
o DLJ Diversified Partners, L.P.
o DLJ Diversified Partners-A, L.P.
o DLJ EAB Partners, L.P.
o DLJ ESC II L.P.
o DLJ First ESC L.P.
o DLJ Investment Funding, Inc.
o DLJ Investment Partners, L.P.
o DLJ Investment Plan 1997 Partners
o DLJ Merchant Banking Partners II, L.P.
o DLJ Merchant Banking Partners II-A, L.P.
o DLJ Millennium Partners, L.P.
o DLJ Millennium Partners-A, L.P.
o DLJ Offshore Partners II, C.V.
o DLJMB Funding II, Inc.
o Xxxxxxx X. Xxxxxxxxxx
o East Hill Foundation
o Xxxx X. Empl
o Xxxxx Xxxxxxxxx
o Xxxxxx X. Xxxxxxx
o Xxxx X. Xxxxxxx
o Xxxxxxxxx X. Xxxxx
o Xxxxxxx X. Xxxxxxxx
o Xxxxxxx Xxxxxxx
o Xxx X. Xxxxxxxxxx
o Xxxx X. Xxxxxxxxxx
o Xxxxxxx X. Xxxxxxxxxx
o Xxxxxxx X. Xxxxxxxxxx
o Xxxxxx X. Xxxxxxxxxx
o Xxxxxx X. Xxxxxxx
o Xxxxxx Xxxxxx
o Hitachi Maxell Ltd.
o Xxxx Xxxxxxx
o Xxxxxx X. Xxxxxx
o Xxxxxx X. Xxxxxxx
o Xxxxx Xxxxx
o Xxxx Xxxxxxxx
o Xxxxxx X. Xxxxxxx
o Xxxxx X. Xxxxxxx
o Xxxxxx X. Xxxxxx
o Xxxxxxxxx X. Xxxx
o Xxxx X. Xxxx
o Xxxxxxx X. Xxxx
o Xxxxxxx X. Xxxxxx
o Xxxxxxx Xxxxx
o Xxxxxx X. Xxxx, Xx.
o Xxxxxxx X. Xxxxxx
o Xxxx X. Xxxxx
o Xxxxxxxxxxx X. Xxxxx
o Xxxxxxxxx X. Xxxxx
o Xxxxx X. Xxxxx
o F. Xxxxx Xxxxx
o Xxxxxx X. Xxxxx
o Xxxxxxx X. Xxxxxxx
o Xxxx Xxxxx
o Xxxxxx X. Xxxxxxx
o Xxxxxxx X. Xxxxxxx
o Xxxxxx X. Xxxxxxxx
o The Northwestern Mutual Life Insurance Company
o UK Investment Plan 1997 Partners
o Xxxxxxx X. Xxxxx
o Xxxxx XxxXxxxxx
o Xxxxxx X. Xxxxxxx
o Xxxxx Xxxxx
o Xxxx Xxxxxxxx
o Xxxx Xxxxx
o Xxxxx X. Xxxxxxx
o Xxx X. Xxxxxxxxxx and Xxxx Xxxxxxxx, as Trustees of the Xxxx Xxxxxxxx
Family Trust U/A/D August 25, 1997
o Xxx X. Xxxxxxxxxx and Xxx Xxxxxxxx, as Trustees of the Xxxxx Xxxxxxxx
Family Trust U/A/D August 25, 1997
o Xxx X. Xxxxxxxxxx and Xxx Xxxxxxxx, as Trustees of the Xxx Xxxxxxxx
Family Trust U/A/D August 25, 1997
o Xxx X. & Xxxxxxxx X. Xxxxxxxxxxx as Tenants in Common
o Xxxxxxx X. & Xxxxxx Xxxxxxxxxx as Tenants in Common
o Xxxxx X. Xxxxxxxxxxx XXX Xxxxxxxx X. Xxxxxxxxxxx
o Xxxx X. Xxxxxxxxxx & Xxxxxx X. Xxxxxxxxxx as Tenants in Common
o Xxxxxxx X. & Xxxxxx X. Xxxxxxxxxx, as Tenants in Common
o Xxxxxxxx X. Xxxxxxxxxxx Xx. and Xxxxx X. Xxxxxxxxxxx as Tenants in
Common
o Xxxxxxxx X. Xxxxxxxxxxx Xx. as Custodian for Xxxxxx X. Xxxxxxxxxxx
under UGMA
o Xxxxxxx X. Xxxxxxx, Xxxx Xxxxxx Xxxxxxxx, Xx., and Xxxxxx Xxxxxx
Xxxxxxx or their successors, Trustees of the Xxxxxx X Xxxxxxx 2000
Family Trust, U/A/D May 16, 2000
o Xxxxxxx X. Xxxx, Trustee of the Xxxxxxx X. Xxxx Trust
o Xxxxxxx X. Xxxx, Trustee of the Xxxxxx X. Xxxx Trust
o Xxxxxxx X. Xxxx, Trustee of the Xxxxx X. Xxxx Trust
o Xxx X. Xxxxxxxx, Trustee of the Trust for Xxxxx Xxxxxx under the Xxx X.
Xxxxxxxxxx 1998 Trusts for Children U/A/D February 11, 1998
o Xxx X. Xxxxxxxx, Trustee of the Trust for Xxxxxxx Xxxxxx under the Xxx
X. Xxxxxxxxxx 1998 Trusts for Children U/A/D February 11, 1998
o Trustees of the Stock Bonus Plan of the Xxxxxx Xxxxxxxxxx Ltd. Equity
Plus Plan
o Trustees of the Xxxxxx Xxxxxxxxxx Ltd. Equity Plus Plan
o Xxxxxx Xxxxxxxxxx and Xxxxx Xxxxxxxxxx as Trustees of the Xxxx
Xxxxxxxxxx Family Trust U/A/D November 17, 1997
