EXHIBIT 10.35
-------------
2,400,000 Shares
MARKET FACTS, INC.
COMMON STOCK, $1.00 PAR VALUE
UNDERWRITING AGREEMENT
October 21, 1997
October 21, 1997
EVEREN Securities, Inc.
The Xxxxxxxx-Xxxxxxxx Company, LLC
As Representatives of the
several Underwriters named in
Schedule I hereto,
c/o EVEREN Securities, Inc.
00 Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Dear Sirs:
Market Facts, Inc., a Delaware corporation ("the Company"), and MFI
Investors L.P. (the "Selling Stockholder"), severally propose to sell an
aggregate of 2,400,000 shares of Common Stock, par value $1.00 per share, of the
Company (the "Firm Shares"), to the several underwriters named in SCHEDULE I
hereto (the "Underwriters"). The Firm Shares consist of 1,900,000 shares to be
issued and sold by the Company and 500,000 outstanding shares to be sold by the
Selling Stockholder. The Company also proposes to issue and sell, and the
Selling Stockholder also proposes to sell, to the several Underwriters not more
than 210,000 and 150,000 additional shares of Common Stock, par value $1.00 per
share, of the Company (the "Additional Shares"), respectively, if requested by
the Underwriters as provided in Section 3 hereof. The Firm Shares and the
Additional Shares are herein collectively called 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 Stockholder are hereinafter collectively called the "Sellers".
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 "Securities Act"), a registration
statement on Form S-3 under the Securities Act (the "registration statement"),
including a prospectus subject to completion relating to the Shares. The term
"Registration Statement" as used in this Agreement means the registration
statement (including all financial schedules and exhibits), as amended at the
time it becomes effective, or, if the registration statement became effective
prior to the execution of this Agreement, as supplemented or amended prior to
the execution of this Agreement. If it is contemplated, at the time this
Agreement is executed, that a post-effective amendment to the registration
statement will be filed and must be declared effective before the offering of
the Shares may commence, the term "Registration Statement" as used in this
Agreement means the registration statement as amended by said post-effective
amendment. The term "Prospectus" as used in this Agreement means the prospectus
in the form included in the Registration Statement, or, if the prospectus
included in the Registration Statement omits information in reliance on Rule
430A under the Securities Act and
such information is included in a prospectus filed with the Commission pursuant
to Rule 424(b) under the Securities Act, the term "Prospectus" as used in this
Agreement means the prospectus in the form included in the Registration
Statement as supplemented by the addition of the Rule 430A information contained
in the prospectus, if any, filed with the Commission pursuant to Rule 424(b). If
the Company has filed an abbreviated registration statement to register
additional shares of Common Stock pursuant to Rule 462(b) under the Securities
Act (the "Rule 462 Registration Statement"), then any reference herein to the
term "Registration Statement" shall be deemed to include such Rule 462
Registration Statement. Any reference in this Agreement to the registration
statement, the Registration Statement, or the Prospectus shall be deemed to
refer to and include the documents incorporated by reference therein pursuant to
Item 12 of Form S-3 under the Securities Act, as of the date of the registration
statement, the Registration Statement, or the Prospectus, as the case may be,
and any reference to any amendment or supplement to the registration statement,
the Registration Statement or the Prospectus shall be deemed to refer to and
include any documents filed after such date under the Securities Exchange Act of
1934, as amended (the "Exchange Act") which, upon filing, are incorporated by
reference therein, as required by paragraph (b) of Item 12 of Form S-3.
1. Representations and Warranties of the Company. The Company represents
and warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; 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) Each part of the Registration Statement, when such part
became effective, did not contain and each such part, as amended or
supplemented, 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 and the Prospectus comply and, as amended or
supplemented, if applicable, will comply in all material respects with the
Securities Act and the applicable rules and regulations of the Commission
thereunder and (iii) 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 Section 1(b) 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 you or by any
Underwriter through you expressly for use therein.
(c) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property
and to conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing in each
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jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as a
whole.
(d) Each subsidiary of the Company has been duly incorporated, is
validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and authority to
own its property and to conduct its business as described in the Prospectus
and is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as a
whole.
(e) The authorized capital stock of the Company conforms as to legal
matters to the description thereof contained in the Prospectus.
(f) The shares of Common Stock (including the Shares to be sold by
the Selling Stockholder) outstanding prior to the issuance of the Shares to
be sold by the Company have been duly authorized and are validly issued,
fully paid and non-assessable.
(g) The Shares to be sold by the Company have been duly authorized
and, when issued and delivered in accordance with the terms of 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.
(h) This Agreement has been duly authorized, executed and delivered
by the Company.
(i) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, this Agreement will not contravene
any provision of applicable law or the certificate of incorporation or by-
laws of the Company or any of its subsidiaries or any agreement or other
instrument binding upon the Company or any of its subsidiaries that is
material to the Company and its subsidiaries, taken as a whole, or any
judgment, order or decree of any governmental body, agency or court having
jurisdiction over the Company or any subsidiary, and no consent, approval,
authorization or order of or qualification with any governmental body or
agency is required for the performance by the Company of its obligations
under this Agreement, except such as may be required by the securities or
Blue Sky laws of the various states in connection with the offer and sale
of the Shares.
(j) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise,
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or in the earnings, business or operations of the Company and its
subsidiaries, taken as a whole, from that set forth in the Prospectus
(exclusive of any amendments or supplements thereto subsequent to the date
of this Agreement).
(k) There are no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened to which the Company or any of its
subsidiaries is a party or to which any of the properties of the Company or
any of its subsidiaries is subject that are required to be described in the
Registration Statement or the Prospectus and are not so described or 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 described or filed as
required.
(l) 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 Securities Act, complied when so filed in
all material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder, 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.
(m) 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" or an entity
"controlled" by an "investment company" as such terms are defined in the
Investment Company Act of 1940, as amended.
(n) The Company and its subsidiaries are (i) in compliance with any
and all applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws"), (ii) have received all permits, licenses or other
approvals required of them under applicable Environmental Laws to conduct
their respective businesses and (iii) are in compliance with all terms and
conditions of any such permit, license or approval, except where such
noncompliance with Environmental Laws, failure to receive required permits,
licenses or other approvals or failure to comply with the terms and
conditions of such permits, licenses or approvals would not, singly or in
the aggregate, have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(o) The Company has complied with all provisions of Section 517.075
Florida Statutes relating to doing business with the Government of Cuba or
with any person or affiliate located in Cuba.
(p) 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
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statement under the Securities 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, except in each
case as described in the Prospectus.
(q) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, (i) the Company and
its subsidiaries have not incurred any material liability or obligation,
direct or contingent, nor entered into any material transaction not in the
ordinary course of business; (ii) the Company has not purchased any of its
outstanding capital stock, nor declared, paid or otherwise made any
dividend or distribution of any kind on its capital stock other than
ordinary and customary dividends; and (iii) there has not been any material
change in the capital stock, short-term debt or long-term debt of the
Company and its subsidiaries, except in each case as described in the
Prospectus.
(r) The Company and its subsidiaries have good and marketable title
in fee simple to all real property and good and marketable title to all
personal property owned by them which is material to the business of the
Company and its subsidiaries, in each case free and clear of all liens,
encumbrances and defects except such as are described in the Prospectus or
such as do not materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property by the
Company and its subsidiaries; and any real property and facilities held
under lease by the Company and its subsidiaries are held by them under
valid, subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be made of
such property and buildings by the Company and its subsidiaries, in each
case except as described in or contemplated by the Prospectus.
(s) The Company and its subsidiaries own or possess, or can acquire
on reasonable terms, all material 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 currently
employed by them in connection with the business now operated by them, 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 the foregoing which, singly or in the aggregate, if the subject of
an unfavorable decision, ruling or finding, would result in any material
adverse change in the condition, financial or otherwise, or in the
earnings, business or operations of the Company and its subsidiaries, taken
as a whole.
(t) No material labor dispute with the employees of the Company or
any of its subsidiaries exists, except as described in or contemplated by
the Prospectus, or, to the knowledge of the Company, is imminent; and the
Company is not aware of any existing, threatened or imminent labor
disturbance by the employees of any of its principal service providers or
suppliers that could result in any material adverse change in the
condition,
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financial or otherwise, or in the earnings, business or operations of the
Company and its subsidiaries, taken as a whole.
(u) The Company and each of its subsidiaries are insured by insurers
of recognized financial responsibility against such losses and risks and in
such amounts as management of the Company believes to be prudent and
customary in the businesses in which the Company and its subsidiaries are
engaged; neither the Company nor any such subsidiary has been refused any
insurance coverage sought or applied for; and neither the Company nor any
such subsidiary has any reason to believe that it will not be able to renew
its existing insurance coverage as and when such coverage expires or to
obtain similar coverage from similar insurers as may be necessary to
continue its business at a cost that would not materially and adversely
affect the condition, financial or otherwise, or the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, except as
described in or contemplated by the Prospectus.
(v) The Company and each of its subsidiaries has all necessary
consents, authorizations, approvals, orders, certificates and permits of
and from (collectively, "permits"), and has made all declarations and
filings with, all federal, state, local, foreign and other governmental and
regulatory authorities, all self-regulatory organizations and all courts
and other tribunals, to own, lease, license and use its properties and
assets and to conduct its business in the manner described in the
Prospectus, except to the extent that the failure to obtain any such permit
or to make any such declaration or filing would not have a material adverse
effect on the Company and its subsidiaries taken as a whole. Neither the
Company nor any such subsidiary has received any notice of proceedings
relating to the revocation or modification of any such permits which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would result in a material adverse change in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, except as
described in or contemplated by the Prospectus; and, except as described in
the Prospectus, such permits contain no restrictions that are materially
burdensome to the Company or any subsidiary.
(w) The Company and each of its subsidiaries maintain 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.
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(x) All of the outstanding shares of capital stock of, or other
ownership interests in, 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, free and clear of any security interest, claim,
lien, encumbrance or adverse interest of any nature.
(y) Neither the Company nor any of its subsidiaries is (i) in
violation of its respective charter or by-laws or (ii) in default in the
performance of any obligation, agreement or condition contained in any
bond, debenture, note or any other evidence of indebtedness or in any other
agreement, indenture or instrument 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, other than defaults that would not,
individually or in the aggregate, have a material adverse effect on the
Company and its subsidiaries, taken as a whole.
(z) Neither the Company nor any of its subsidiaries has violated any
federal or state law relating to discrimination in the hiring, promotion or
pay of employees nor any applicable federal or state wages and hours laws,
nor any provisions of the Employee Retirement Income Security Act or the
rules and regulation promulgated thereunder, which in each case are
reasonably likely to result in any material adverse change in the
condition, financial or otherwise, or in the earnings or business
operations of the Company and its subsidiaries, taken as a whole.
(aa) The Company has filed an application to list the Shares on the
Nasdaq National Market and has received notification that the listing has
been approved, subject to notice of issuance of the Shares.
(ab) There are no outstanding subscriptions, rights, warrants,
options, calls, convertible securities, commitments of sale or liens
related to or entitling any person to purchase or otherwise to acquire any
shares of the capital stock of, or other ownership interest in, the Company
or any subsidiary thereof, except as otherwise disclosed in the
Registration Statement.
(ac) 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.
(ad) KPMG Peat Marwick LLP is the independent public accountant with
respect to the Company as required by the Securities Act.
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(ae) The financial statements, together with related schedules and
notes forming part of the Registration Statement and the Prospectus (and
any amendment or supplement thereto), present fairly the consolidated
financial position, results of operations and changes in financial position
of the Company and its subsidiaries on the basis stated in the Registration
Statement 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; and the other financial and statistical information and data set
forth in the Registration Statement and the Prospectus (and any amendment
or supplement thereto) is, in all material respects, accurately presented
and prepared on a basis consistent with such financial statements and the
books and records of the Company.
2. Representations and Warranties of the Selling Stockholder. The
Selling Stockholder represents and warrants to and agrees with each of the
Underwriters that:
(a) This Agreement has been duly authorized, executed and delivered
by or on behalf of the Selling Stockholder.
(b) The execution and delivery by the Selling Stockholder of, and the
performance of the Selling Stockholder of its obligations under, this
Agreement, the Custody Agreement signed by the Selling Stockholder and
First Chicago Trust Company of New York, as Custodian, relating to the
deposit of the Shares to be sold by the Selling Stockholder (the "Custody
Agreement") and the Power of Attorney appointing certain individuals as the
Selling Stockholder's attorneys-in-fact to the extent set forth therein,
relating to the transactions contemplated hereby and by the Registration
Statement (the "Power of Attorney") will not contravene any provision of
applicable law, or the partnership agreement of the Selling Stockholder, or
any agreement or other instrument binding upon the Selling Stockholder or
any judgment, order or decree of any governmental body, agency or court
having jurisdiction over the Selling Stockholder, and no consent, approval,
authorization or order of, or qualification with, any governmental body or
agency is required for the performance by the Selling Stockholder of its
obligations under this Agreement or the Custody Agreement or Power of
Attorney of the Selling Stockholder, except such as may be required by the
securities or Blue Sky laws of the various states in connection with the
offer and sale of the Shares.
(c) The Selling Stockholder has, and on the Closing Date and any
later date on which the Additional Shares are to be purchased will have,
good and marketable title to the Shares to be sold by the Selling
Stockholder and the legal right and power, and all authorization and
approval required by law, to enter into this Agreement, the Custody
Agreement and the Power of Attorney and to sell, transfer and deliver the
Shares to be sold by the Selling Stockholder.
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(d) The Custody Agreement and the Power of Attorney have been duly
authorized, executed and delivered by the Selling Stockholder and are valid
and binding agreements of the Selling Stockholder.
(e) Certificates in negotiable form for Shares to be sold by such
Selling Stockholder have been placed in custody under the Custody Agreement
for delivery under this Agreement with the Custodian; the Selling
Stockholder agrees that the shares of Common Stock represented by the
certificates so held in custody for the Selling Stockholder are subject to
the interests of the several Underwriters and the Company, that the
arrangements made by such Selling Stockholder for such custody, including
the Power of Attorney, are to that extent irrevocable, and that the
obligations of the Selling Stockholder shall not be terminated by any act
of the Selling Stockholder or by operation of law, whether by the
termination, dissolution or liquidation of the Selling Stockholder or the
occurrence of any other event; if any such termination, dissolution,
liquidation or other such event should occur before the delivery of the
Shares to be sold by the Selling Stockholder hereunder, certificates for
such shares of the Common Stock shall be delivered by the Custodian in
accordance with the terms and conditions of this Agreement as if such
termination, dissolution, liquidation or other event had not occurred,
regardless of whether the Custodian shall have received notice of such
termination, dissolution, liquidation or other event.
(f) Delivery of the Shares to be sold by the Selling Stockholder
pursuant to this Agreement will pass title to the Shares free and clear of
any security interests, claims, liens, equities and other encumbrances.
(g) (i) To the knowledge of the Selling Stockholder, the
Registration Statement, when it became effective, did 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 required to
be stated therein or necessary to make the statements therein not
misleading, (ii) the Registration Statement and the Prospectus comply and,
as amended or supplemented, if applicable, will comply in all material
respects with the Securities Act and the applicable rules and regulations
of the commission thereunder and (iii) 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 Section 2(g) 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.
(h) The Selling Stockholder has not taken and will not take, directly
or indirectly, any action which has constituted, or which is designed to or
might reasonably
9
be expected to cause or result in, stabilization or manipulation of the
price of sale or resale of the Common Stock.
3. AGREEMENTS TO SELL AND PURCHASE. Each Seller, severally and not
jointly, hereby agrees to sell to the several Underwriters, and each
Underwriter, upon the basis of the representations and warranties herein
contained, but subject to the conditions hereinafter stated, agrees, severally
and not jointly, to purchase from such Seller at U.S. $21.00 a share (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 in SCHEDULE I hereto opposite the name of such Underwriter
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, each Seller, severally and
not jointly, agrees to sell to the Underwriters the Additional Shares, and the
Underwriters shall have a one-time right to purchase, severally and not jointly,
up to 360,000 Additional Shares, 210,000 Additional Shares from the Company and
150,000 Additional Shares from the Selling Stockholder, at the Purchase Price.
Such date may be the same as the Closing Date (as defined below) but not earlier
than the Closing Date nor later than ten business days after the date written
notice of an election to purchase Additional Shares is given. If the
Representatives, on behalf of the Underwriters, elect to exercise such option,
the Representatives shall so notify the Company in writing not later than 45
days after the date of the Prospectus which notice shall specify the number of
Additional Shares to be purchased by the Underwriters and the date on which such
Additional Shares are to be purchased. Additional Shares may be purchased as
provided in Section 5 hereof solely for the purpose of covering over allotments
made in connection with the offering of the Firm Shares. If any Additional
Shares are to be purchased, each Underwriter agrees, severally and not jointly,
to purchase the number of Additional Shares that bears the same proportion to
the total number of Additional Shares to be purchased as the number of Firm
Shares set forth in SCHEDULE I hereto opposite the name of such Underwriter
bears to the total number of Firm Shares. If the Representatives, on behalf of
the Underwriters, elect to purchase less than all of the Additional Shares, then
the Underwriters shall purchase and the Company and the Selling Stockholder, as
the case may be, shall sell the number of Additional Shares (subject to such
adjustments to eliminate fractional shares as the Representatives may determine)
equal to (A) in the case of the Company, the product of (i) the number of
Additional Shares the Underwriters have elected to purchase multiplied by (ii)
the quotient of 210,000 divided by 360,000 and (B) in the case of the Selling
Stockholder, the product of (i) the number of Additional Shares the Underwriters
have elected to purchase multiplied by (ii) the quotient of 150,000 divided by
360,000. The Additional Shares to be purchased by the Underwriters hereunder
and the Firm Shares are hereinafter collectively referred to as the "Shares."
Each Seller hereby agrees that, without the prior written consent of EVEREN
Securities, Inc., it will not, directly or indirectly, during the period ending
120 days after the date of the Prospectus, (i) offer, sell (including, without
limitation, any short sale), pledge, contract to sell,
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grant any option to purchase or otherwise dispose of any Common Stock
(including, without limitation, shares of Common Stock which may be deemed to be
beneficially owned by the Seller in accordance with the rules and regulations of
the Commission and shares of Common Stock which may be issued upon exercise of a
stock option or warrant) or any options, warrants, or other securities
convertible into or exercisable or exchangeable for such Common Stock, in any
case whether now owned or hereafter acquired, or in any manner to transfer all
or a portion of the economic consequences associated with ownership of the
Common Stock. The foregoing sentence shall not apply to (A) the Shares to be
sold hereunder, (B) the issuance by the Company of shares of Common Stock upon
the exercise of an option or warrant or the conversion of a security outstanding
on the date hereof which is disclosed or reflected in the Prospectus, (C) the
grant by the Company of options or other awards or the issuance by the Company
of Common Stock pursuant to the Market Facts, Inc. 1996 Stock Plan and the
employee stock purchase plans, (D) the transfer of the Common Stock by the
Selling Stockholder by one or more bona fide gifts or pledges, provided that the
donee(s) or pledgee(s) thereof agree in writing to be bound by this paragraph,
(E) the transfer of Common Stock by the Selling Stockholder to its affiliates,
which affiliates agree in writing to be bound by this paragraph, or (F) the
transfer of limited partnership interests in the Selling Stockholder. In
addition, the Selling Stockholder, agrees that, without the prior written
consent of the Representatives, it will not, during the period ending 120 days
after the date of the Prospectus, make any demand for, or exercise any right
with respect to, the registration of any shares of Common Stock or any security
convertible into or exercisable or exchangeable for Common Stock.
4. TERMS OF PUBLIC OFFERING. The Sellers are advised by you that the
Underwriters propose to make a public offering of their respective portions of
the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable. The Sellers are further
advised by you that the Shares are to be offered to the public initially at U.S.
$21.00 a share (the "Public Offering Price") and to certain dealers selected by
you at a price that represents a concession not in excess of U.S. $1.31 a share
under the Public Offering Price, and that any Underwriter may allow, and such
dealers may reallow, a concession, not in excess of U.S. $0.10 a share, to any
Underwriter or to certain other dealers.
5. PAYMENT AND DELIVERY. Payment for the Firm Shares to be sold by each
Seller shall be made to such Seller in Federal or other funds immediately
available in Chicago against delivery of such Firm Shares for the respective
accounts of the several Underwriters at 9:00 A.M., Chicago time, on October 27,
1997, or at such other time on the same or such other date, not later than
October 31, 1997, as shall be designated in writing by you. The time and date
of such payment are hereinafter referred to as the "Closing Date."
Payment for any Additional Shares to be sold by each Seller shall be made
to such Seller in Federal or other funds immediately available in Chicago
against delivery of such Additional Shares for the respective accounts of the
several Underwriters at 9:00 A.M., Chicago time, on the date specified in the
notice described in Section 3 or on such other date, in any event not later
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than, December 16, 1997, as shall be designated in writing by the
Representatives. The time and date of such payment are hereinafter referred to
as the "Option Closing Date."
Certificates for the Firm Shares and Additional Shares shall be in
definitive form and registered in such names and in such denominations as you
shall request in writing not later than two full business days prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to you on
the Closing Date or the Option Closing Date, as the case may be, for the
respective accounts of the several Underwriters, with any transfer taxes payable
in connection with the transfer of the Shares to the Underwriters duly paid,
against payment of the Purchase Price therefor.
6. CONDITIONS TO THE UNDERWRITERS' OBLIGATIONS. The obligations of the
Sellers to sell the Shares to the Underwriters and the several obligations of
the Underwriters to purchase and pay for the Shares on the Closing Date
hereunder are subject to the condition that the Registration Statement shall
have become effective not later than 3:00 P.M. (Chicago time) on the date
hereof.
The several obligations of the Underwriters hereunder are subject to the
following further conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date, there shall not have occurred any change, or any
development involving a prospective change, in the condition, financial or
otherwise, or in the earnings, business or operations, of the Company and
its subsidiaries, taken as a whole, from that set forth in the Prospectus
(exclusive of any amendments or supplements thereto subsequent to the date
of this Agreement), that, in your judgment, is material and adverse and
that makes it, in your judgment, impracticable to market the Shares on the
terms and in the manner contemplated in the Prospectus.
(b) The Underwriters shall have received on the Closing Date a (x)
certificate, dated the Closing Date and signed by an executive officer of
the Company, to the effect set forth in clause Section 6(a) above and to
the effect that the representations and warranties of the Company contained
in this Agreement are true and correct as of the Closing Date and that the
Company has complied with all of the agreements and satisfied all of the
conditions on its part to be performed or satisfied hereunder on or before
the Closing Date, and (y) a certificate of the Selling Stockholder to the
effect that the representations and warranties of the Selling Stockholder
contained in this Agreement are true and correct as of the Closing Date and
that such Selling Stockholder has complied with all the agreements and
satisfied all of the conditions on its part to be performed or satisfied
hereunder on or before the Closing Date.
(c) The Underwriters shall have received on the Closing Date an
opinion of Lord Bissell & Brook, counsel for the Company, dated the Closing
Date, to the effect that:
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(i) the Company is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation, has
the corporate power and authority to own its property and to conduct
its business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries taken as a
whole;
(ii) Market Facts of Canada, Ltd. has been duly incorporated;
each subsidiary of the Company is validly existing as a corporation in
good standing under the laws of the jurisdiction of its incorporation,
has the corporate power and authority to own its property and to
conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing would not
have a material adverse effect on the Company and its subsidiaries
taken as a whole;
(iii) the authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the Prospectus;
(iv) the shares of Common Stock (including the Shares to be sold
by the Selling Stockholder) outstanding prior to the issuance of the
Shares to be sold by the Company have been duly authorized and are
validly issued, fully paid and non-assessable;
(v) the Shares to be sold by the Company have been duly
authorized and, when issued and delivered in accordance with the terms
of 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;
(vi) this Agreement has been duly authorized, executed and
delivered by the Company;
(vii) the Registration Statement has become effective under the
Securities Act, no stop order suspending its effectiveness has been
issued and no proceedings for that purpose are, to the knowledge of
such counsel, pending or threatened by the Commission; and to the best
of our knowledge, after due inquiry, at the time the Registration
Statement became effective the Company met the conditions for use of
Form S-3 under the Securities Act;
13
(viii) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement
will not contravene (A) any provision of applicable law or the
certificate of incorporation or by-laws of the Company or any of its
subsidiaries, (B) any agreement or other instrument binding upon the
Company or any of its Subsidiaries that is material to the Company and
its subsidiaries, taken as a whole, and that is known to such counsel
after due inquiry or (C) to the best of such counsel's knowledge after
due inquiry, any judgment or decree of any governmental body, agency
or court having jurisdiction over the Company or any subsidiary; and
no consent, approval, authorization or order of or qualification with
any governmental body or agency is required for the performance by the
Company of its obligations under this Agreement, except such as may be
required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Shares by the Underwriters;
(ix) to the best of such counsel's knowledge after due inquiry,
no holder of any security of the Company has any right to require
registration of shares of Common Stock or any other security of the
Company, except as described in the Prospectus;
(x) all of the outstanding shares of capital stock of, or other
ownership interests in, each of the Company's subsidiaries have been
duly and validly authorized and issued, and are owned by the Company,
free and clear of any security interest, claim, lien, encumbrance or
adverse interest of any nature and all of the outstanding shares of
capital stock of, or other ownership interests in, Market Facts of
Canada, Ltd. are fully paid and non-assessable;
(xi) to the best of such counsel's knowledge after due inquiry,
the Company and each of its subsidiaries has all necessary consents,
authorizations, approvals, orders, certificates and permits of and
from (collectively, "permits"), and has made all declarations and
filings with, all federal, state, local, foreign and other
governmental and regulatory authorities, all self-regulatory
organizations and all courts and other tribunals, to own, lease,
license and use its properties and assets and to conduct its business
in the manner described in the Prospectus, except to the extent that
the failure to obtain any such permit or to make any such declaration
or filing would not have a material adverse effect on the Company and
its subsidiaries taken as a whole; and to the knowledge of such
counsel after due inquiry, neither the Company nor any such subsidiary
has received any notice of proceedings relating to the revocation or
modification of any such permits which, singly or in the aggregate, if
the subject of an unfavorable decision, ruling or finding, would
result in a material adverse change in the condition, financial or
otherwise, or in the earnings, business or operations of the Company
and its subsidiaries, taken as a whole, except as described in or
contemplated by the Prospectus;
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(xii) the statements (A) in the Prospectus under the captions
"Description of Capital Stock," "Shares Eligible for Future Sale" and
"Underwriting" and (B) in the Registration Statement in Item 15, in
each case insofar as such statements constitute summaries of the legal
matters, documents or proceedings referred to therein and in the case
of the statements under the caption "Underwriting" only insofar as
such statements relate to this Agreement, fairly present the
information called for with respect to such legal matters, documents
and proceedings and fairly summarize the matters referred to therein;
(xiii) after due inquiry, such counsel does not know of any
legal or governmental proceeding pending or threatened to which the
Company or any of its subsidiaries is a party or to which any of the
properties of the Company or any of its subsidiaries is 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 described or filed as
required;
(xiv) 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" or an entity "controlled" by an "investment company," as such
terms are defined in the Investment Company Act of 1940, as amended;
(xv) to the knowledge of such counsel after due inquiry, the
Company and its Subsidiaries (A) are in compliance with any and all
applicable Environmental Laws, (B) have received all permits, licenses
or other approvals required of them under applicable Environmental
Laws to conduct their respective businesses and (C) are in compliance
with all terms and conditions of any such permit, license or approval,
except where such noncompliance with Environmental Laws, failure to
receive required permits, licenses or other approvals or failure to
comply with the terms and conditions of such permits, licenses or
approvals would not, singly or in the aggregate, have a material
adverse effect on the Company and its subsidiaries, taken as a whole;
and
(xvi) (A) the Registration Statement and Prospectus (except for
financial statements and schedules and other financial and statistical
data included therein as to which such counsel need not express any
opinion) comply as to form in all material respects with the
Securities Act and the rules and regulations of the Commission
thereunder, (B) the documents incorporated by reference in the
Registration Statement and the Prospectus, as such incorporated
documents may have been amended, (except for financial statements and
schedules and other financial and statistical data included in such
incorporated documents as to which
15
counsel need not express any opinion) comply as to form in all
material respects with the Exchange Act and the rules and regulations
of the Commission thereunder, (C) such counsel has no reason to
believe that (except for financial statements and schedules and other
financial and statistical data as to which such counsel need not
express any belief) the Registration Statement and the Prospectus
included therein at the time the Registration Statement became
effective 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 (except for financial statements and schedules
and other financial and statistical data as to which such counsel need
not express any belief) the Prospectus contains any untrue statement
of a material fact or omits to state a material fact necessary in
order to make the statements therein, in light of the circumstances
under which they were made, not misleading.
(d) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxxxx & Xxxxx, counsel for the Selling Stockholder, dated the
Closing Date, to the effect that:
(i) this Agreement has been duly authorized, executed and
delivered by or on behalf of the Selling Stockholder;
(ii) the execution and delivery by the Selling Stockholder of,
and the performance by the Selling Stockholder of its obligations
under, this Agreement and the Custody Agreement and Power of Attorney
of the Selling Stockholder will not contravene any provision of
applicable law known to such counsel, or the certificate of
partnership or the partnership agreement of the Selling Stockholder,
or, to the best of such counsel's knowledge, any agreement or other
instrument binding upon the Selling Stockholder or, to the best of
such counsel's knowledge, any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the
Selling Stockholder, and no consent, approval, authorization or order
of, or qualification with, any governmental body or agency is required
for the performance by the Selling Stockholder of its obligations
under this Agreement or the Custody Agreement or Power of Attorney of
the Selling Stockholder, except such as may be required by the
securities or Blue Sky laws of the various states in connection with
the offer and sale of the Shares;
(iii) the Selling Stockholder has the legal right and power to
enter into this Agreement and the Custody Agreement and Power of
Attorney of the Selling Stockholder and to sell, transfer and deliver
the Shares to be sold by the Selling Stockholder;
16
(iv) the Custody Agreement and the Power of Attorney of the
Selling Stockholder have been duly authorized, executed and delivered
by the Selling Stockholder and are valid and binding agreements of the
Selling Stockholder; and
(v) delivery of the Shares to be sold by the Selling Stockholder
pursuant to this Agreement will pass title to such Shares free and
clear of any security interests, claims, liens, equities and other
encumbrances.
(e) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxx Xxxxxx & Zavis, special counsel for the Underwriters,
dated the Closing Date, covering the matters referred to in clauses (v),
(vi) (with regards to authorization, execution and delivery by the
Company), (xii) (but only as to the statements in the Prospectus under
"Underwriting") and (xvi)(A), (C) and (D) of Section 6(c) above.
With respect to clause (xvi) of Section 6(c) above, Lord Bissell &
Brook and Xxxxxx 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
review and discussion of the contents thereof, but are without independent
check or verification except as specified. With respect to Section 6(c)
above, Lord Bissell & Brook may rely, with respect to matters including the
application of laws of any jurisdictions other than the laws of the State
of Illinois or the United States or the Delaware General Corporation Law
and to the extent such counsel deems appropriate, upon an opinion or
opinions of local counsel, provided that (a) each such local counsel is
satisfactory to your counsel, (b) a copy of each opinion so relied upon is
delivered to you and is in form and substance satisfactory to your counsel,
and (c) Lord Bissell & Brook shall state in their opinion that they believe
they are justified in relying on each others opinion.
The opinion of Lord Bissell & Brook described in Section 6(c) above and
the opinion of Xxxxxxxx & Xxxxx described in Section 6(d) above shall be
rendered to the Underwriters at the request of the Company or of the
Selling Stockholder, as the case may be, and shall so state therein.
(f) The Underwriters 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 KPMG
Peat Marwick LLP, independent public accountants, containing statements and
information 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; provided that the letter delivered on the Closing Date
shall use a "cut-off date" not earlier than the date hereof. The letters
shall not disclose any change, or any development involving a prospective
change, in or affecting the business or properties of the Company or any of
its subsidiaries which, in your sole judgment, makes it impractical
17
or inadvisable to proceed with the public offering of the Shares as
contemplated by the Prospectus.
(g) The "lock-up" agreements, between you and certain stockholders,
officers and directors of the Company relating to sales and certain other
dispositions of shares of Common Stock or certain other securities,
delivered to you on or before the date hereof, shall be in full force and
effect on the Closing Date.
The several obligations of the Underwriters to purchase Additional Shares
hereunder are subject to the delivery to the Representatives on the Option
Closing Date of such documents as they may reasonably request with respect to
the good standing of the Company, the due authorization and issuance of the
Additional Shares and other matters related to the issuance of the Additional
Shares.
7. Covenants of the Company. In further consideration of the agreements
of the Underwriters herein contained, the Company covenants with each
Underwriter as follows:
(a) To furnish to you, without charge, seven signed copies of the
Registration Statement (including exhibits thereto) and for delivery to
each other Underwriter a conformed copy of the Registration Statement
(without exhibits thereto) and to furnish to you in New York, without
charge, prior to 10:00 a.m. local time on the business day next succeeding
the date of this Agreement and during the period mentioned in paragraph (c)
below, as many copies of the Prospectus and any supplements and amendments
thereto or to the Registration Statement as you may reasonably request.
(b) Before amending or supplementing the Registration Statement or
the Prospectus, to furnish to you a copy of each such proposed amendment or
supplement and not to file any such proposed amendment or supplement to
which you reasonably object, and to file with the Commission within the
applicable period specified in Rule 424(b) under the Securities Act any
prospectus required to be filed pursuant to such rule.
(c) If, during such period after the first date of the public
offering of the Shares as in the opinion of counsel for the Underwriters
the Prospectus is required by law to be delivered in connection with sales
by an Underwriter or dealer, any event shall occur or condition exist as a
result of which it is 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 your counsel, it is necessary to amend or supplement the
Prospectus to comply with law, forthwith to prepare, file with the
Commission and furnish, at its own expense, to the Underwriters and to the
dealers (whose names and addresses you will furnish to the Company) to
which Shares may have been sold by you on behalf of the Underwriters and to
any other dealers upon request, either amendments or supplements to the
Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light
18
of the circumstances when the Prospectus is delivered to a purchaser, be
misleading or so that the Prospectus, as amended or supplemented, will
comply with law.
(d) To endeavor to qualify the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request; provided, however, that the Company shall not be obligated to file
any general consent to service of process or to qualify as a foreign
corporation in any jurisdiction in which it is not currently so qualified.
(e) To make generally available to the Company's security holders and
to you as soon as practicable an earnings statement covering the twelve-
month period ending December 31, 1998 that satisfies the provisions of
Section 11(a) of the Securities Act and the rules and regulations of the
Commission thereunder.
(f) During the period referred to in paragraph (e), the Company will
furnish to you as soon as available a copy of each report or other publicly
available information of the Company mailed to the holders of Common Stock
or filed with the Commission and such other publicly available information
concerning the Company and its subsidiaries as you may reasonably request.
8. Expenses of the Company. Whether or not the transactions contemplated
in this Agreement are consummated or this Agreement is terminated, the Company
agrees 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 accountant in connection
with the registration and delivery of the Shares under the Securities Act and
all other fees or expenses in connection with the preparation and filing of the
Registration Statement, any preliminary prospectus, the Prospectus and
amendments and supplements to any of the foregoing, including all printing costs
associated therewith, and the mailing and delivering of copies thereof to the
Underwriters and dealers, in the quantities hereinabove specified, (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) the
cost of printing or producing any Blue Sky or Legal Investment memorandum in
connection with the offer and sale of the Shares under state securities laws and
all expenses in connection with the qualification of the Shares for offer and
sale under state securities laws as provided in Section 7(d) hereof, including
filing fees and the reasonable fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the
Blue Sky or Legal Investment memorandum, (iv) all filing fees and disbursements
of counsel to the Underwriters incurred in connection with the review and
qualification of the offering of the Shares by the National Association of
Securities Dealers, Inc., (v) all costs and expenses incident to listing the
Shares on the Nasdaq National Market and other national securities exchanges and
foreign stock exchanges, (vi) the cost of printing certificates representing the
Shares, (vii) the costs and charges of any transfer agent, registrar or
depositary, (viii) the costs and expenses of the Company relating to investor
presentations on any "road show" undertaken in connection with the marketing of
the offering of the Shares, including, without
19
limitation, expenses associated with the production of road show slides and
graphics, fees and expenses of any consultants engaged in connection with the
road show presentations with the prior approval of the Company, travel and
lodging expenses of the representatives and officers of the Company and any such
consultants, and the cost of any aircraft chartered in connection with the road
show, and (ix) all other costs and expenses incident to the performance of the
obligations of the Company and the Selling Stockholder hereunder for which
provision is not otherwise made in this Section. It is understood, however,
that except as provided in this Section 8, Section 9 entitled "Indemnity and
Contribution", and the last paragraph of Section 11 below, the Underwriters will
pay all of their costs and expenses, including fees and disbursements of their
counsel, stock transfer taxes payable on resale of any of the Shares by them and
any advertising expenses connected with any offers they may make.
9. INDEMNITY AND CONTRIBUTION.
--------------------------
(a) The Company agrees to indemnify and hold harmless each
Underwriter, the directors, officers, partners, employees and agents of,
and each person, if any, who controls any Underwriter within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act,
from and against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses reasonably
incurred in connection with defending or investigating any such action or
claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment
thereof, any preliminary prospectus or the Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or
supplements thereto), 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 or liabilities are caused by any such untrue statement or
omission or alleged untrue statement or omission based upon information
relating to any Underwriter furnished to the Company in writing by such
Underwriter through you expressly for use therein; provided, however, that,
with respect to any untrue statement or alleged untrue statement or
omission or alleged omission made in any preliminary prospectus, the
foregoing indemnity agreement shall not inure to the benefit of any
Underwriter from whom the person asserting any such losses, claim, damages
or liabilities purchased the Shares concerned, or any person controlling
such Underwriter, to the extent that any such loss, claim, damage or
liability of such Underwriter results from the fact that a copy of the
Prospectus (or Prospectus as amended or supplemented) was not sent or given
to such person, if required by the Securities Act so to have been
delivered, at or prior to the written confirmation of the sale of such
Shares to such person and the untrue statement or alleged untrue statement
or omission or alleged omission was corrected in such Prospectus (or
Prospectus as amended or supplemented), if the Company had previously
furnished copies of such Prospectus (or Prospectus as amended or
supplemented) to such Underwriter.
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(b) The Selling Stockholder agrees to indemnify and hold harmless
each Underwriter, the directors, officers, partners, employees and agents
of, and each person, if any, who controls any Underwriter within the
meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or any amendment
thereof, any preliminary prospectus or the Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or
supplements thereto) 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; provided, however, that the Selling
Stockholder's indemnification obligation shall arise only if and to the
extent that (i) the Underwriters shall have established (by way of a final,
nonappealable judgment of a court of proper jurisdiction) that the Selling
Stockholder has breached any of the representations and warranties set
forth in Section 2(g) and (ii) the losses, claims, damages or liabilities
as to which indemnification is sought arise out of or are based upon such
breach.
(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 either Section 15 of the Securities Act or Section 20
of the Exchange Act, and the Selling Stockholder and each person, if any,
who controls the Selling Stockholder within the meaning of either Section
15 of the Securities Act or Section 20 of the Exchange Act from and against
any and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred in connection
with defending or investigating any such action or claim) caused by any
untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement or any amendment thereof, any preliminary
prospectus or the Prospectus (as amended or supplemented if the Company
shall have furnished any amendments or supplements thereto), 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, but only with reference to information relating to such
Underwriter furnished to the Company in writing by such Underwriter through
you expressly for use in the Registration Statement, any preliminary
prospectus, the Prospectus or any amendments or supplements thereto
(d) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may
be sought pursuant to Section 9(a), (b) or (c), such person (the
"Indemnified Party") shall promptly notify the person against whom such
indemnity may be sought (the "Indemnifying Party") in writing and the
Indemnifying Party, upon request of the Indemnified Party, shall retain
counsel reasonably satisfactory to the Indemnified Party to represent the
Indemnified Party and any others the Indemnifying Party may designate in
such proceeding and shall pay the fees and
21
disbursements of such counsel related to such proceeding. In any such
proceeding, any Indemnified Party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense
of such Indemnified Party unless (i) the Indemnifying Party and the
Indemnified Party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the Indemnifying Party and the Indemnified
Party and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them.
It is understood that the Indemnifying Party shall not, in respect of the
legal expenses of any Indemnified Party in connection with any proceeding
or related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel)
for (i) all Underwriters and all persons, if any, who control any
Underwriter within the meaning of either Section 15 of the Securities Act
or Section 20 of the Exchange Act, (ii) the Company, its directors, its
officers who sign the Registration Statement and each person, if any, who
controls the Company within the meaning of either such Section and (iii)
the Selling Stockholder and all persons, if any, who control the Selling
Stockholder within the meaning of either such Section of the Securities Act
or the Exchange Act, and that all such fees and expenses shall be
reimbursed as they are incurred. In the case of any such separate firm for
the Underwriters and such control persons of Underwriters, such firm shall
be designated in writing by EVEREN Securities, Inc. 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
Stockholder and such controlling persons of the Selling Stockholder, such
firm shall be designated in writing by the persons named as attorneys-in-
fact for the Selling Stockholder under the Powers of Attorney. The
Indemnifying Party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or
if there be a final judgment for the plaintiff, the Indemnifying Party
agrees to indemnify the Indemnified Party from and against any loss or
liability by reason of such settlement or judgment. Notwithstanding the
foregoing sentence, if at any time an Indemnified Party shall have
requested an Indemnifying Party to reimburse the Indemnified Party for fees
and expenses of counsel as contemplated by the second and third sentences
of this paragraph, the Indemnifying Party agrees that it shall be liable
for any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than 60 days after receipt by
such Indemnifying Party of the aforesaid request and (ii) such Indemnifying
Party shall not have reimbursed the Indemnified Party in accordance with
such request prior to the date of such settlement or, if such Indemnifying
Party in good faith disputes all or a portion of such fees and expenses,
such Indemnifying Party shall have failed to provide the Indemnified Party
with reasonable security for payment of the disputed amounts. No
Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Party is or could have been
a party and indemnity could have been sought hereunder by such Indemnified
22
Party, unless such settlement includes an unconditional release of such
Indemnified Party from all liability on claims that are the subject matter
of such proceeding.
(e) If the indemnification provided for in Section 9(a), (b) or (c)
is unavailable to an Indemnified Party or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then each
Indemnifying Party under such paragraph, in lieu of indemnifying such
Indemnified Party thereunder, shall contribute to the amount paid or
payable by such Indemnified Party as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect
the relative benefits received by the Indemnifying Party or Parties on the
one hand and the Indemnified Party or Parties 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 Indemnifying Party or Parties
on the one hand and of the Indemnified Party or Parties on the other hand
in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the Sellers on
the one hand and the Underwriters on the other hand in connection with the
offering of the Shares shall be deemed to be in the same respective
proportions as the net proceeds from the offering of the Shares (before
deducting expenses) received by each Seller and the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover of the Prospectus, bear to the aggregate
Public Offering Price of the Shares. The relative fault of the Sellers 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 Sellers or by the
Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The Underwriters' respective obligations to contribute pursuant
to this Section 9 are several in proportion to the respective number of
Shares they have purchased hereunder, and not joint.
(f) The Sellers and the Underwriters agree that it would not be just
or equitable if contribution pursuant to this Section 9 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 that does not take
account of the equitable considerations referred to in Section 9(e). The
amount paid or payable by an Indemnified Party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such Indemnified
Party in connection with investigating or defending any such action or
claim. Notwithstanding the provisions of this Section 9, 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
that such Underwriter has
23
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 Securities
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The remedies provided for in this
Section 9 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) The indemnity and contribution provisions contained in this
Section 9 and the representations and warranties of the Company and the
Selling Stockholder contained in this Agreement shall remain operative and
in full force and effect regardless of (i) any termination of this
Agreement, (ii) any investigation made by or on behalf of any Underwriter
or any person controlling the Underwriter, the Selling Stockholder or any
person controlling the Selling Stockholder, or the Company, its officers or
directors or any person controlling the Company and (iii) acceptance of and
payment for any of the Shares.
(h) Notwithstanding anything to the contrary contained herein, the
aggregate liability of the Selling Stockholder pursuant to the provisions
of this Section 9 and with respect to breaches of the representations,
warranties and agreements contained in Section 2, except for liability
resulting from the willful misconduct or intentional action of the Selling
Stockholder, shall not exceed an amount equal to the total price at which
the Shares of which the Selling Stockholder is a beneficial owner (as
defined in Rule 13d-3 under the Exchange Act) were sold to the public
hereunder.
10. TERMINATION. This Agreement shall be subject to termination by notice
given by you to the Company, if (a) after the execution and delivery of this
Agreement and prior to the Closing Date (i) trading generally shall have been
suspended or materially limited on or by, as the case may be, any of the New
York Stock Exchange, the American Stock Exchange, the Nasdaq National Market,
the Chicago Board of Options Exchange, the Chicago Mercantile Exchange or the
Chicago Board of Trade, (ii) trading of any securities of the Company shall have
been suspended on any exchange or in any over-the-counter market, (iii) a
general moratorium on commercial banking activities in New York shall have been
declared by either Federal or New York State authorities or (iv) there shall
have occurred any outbreak or escalation of hostilities or any change in
financial markets or any calamity or crisis that, in your judgment, is material
and adverse and (b) in the case of any of the events specified in clauses (a)(i)
through (iv) of this Section 10, such event singly or together with any other
such event makes it, in your judgment, impracticable to market the Shares on the
terms and in the manner contemplated in the Prospectus.
11. EFFECTIVENESS; DEFAULTING UNDERWRITERS. This Agreement shall become
effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date or the Option Closing Date, as the case may be, any
one or more of the Underwriters shall fail or refuse to purchase Shares that it
or they have agreed to purchase hereunder on such date, and the aggregate number
of Shares which such defaulting Underwriter
24
or Underwriters agreed but failed or refused to purchase is not more than one-
tenth of the aggregate number of the Shares to be purchased on such date, the
other Underwriters shall be obligated severally in the proportions that the
number of Firm Shares set forth opposite their respective names in Schedule I
bears to the aggregate number of Firm Shares set forth opposite the names of all
such nondefaulting Underwriters, or in such other proportions as you may
specify, to purchase the Shares 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 Shares that any Underwriter has agreed to
purchase pursuant to this Agreement be increased pursuant to this Section 11 by
an amount in excess of one-ninth of such number of Shares without the written
consent of such Underwriter. If, on the Closing Date or the Option Closing
Date, as the case may be, 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 on such date, and arrangements satisfactory to you, the
Company and the Selling Stockholder for the purchase of such Firm Shares are not
made within 36 hours after such default, this Agreement shall terminate without
liability on the part of any non-defaulting Underwriter, the Company or the
Selling Stockholder. In any such case either you or the relevant Sellers shall
have the right to postpone the Closing Date or the Option Closing Date, as the
case may be, but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement and in the Prospectus or
in any other documents or arrangements may be effected. If, on the Option
Closing Date, any Underwriter 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, the non-defaulting Underwriters shall have the option to (i)
terminate their obligation hereunder to purchase Additional Shares or (ii)
purchase not less than the number of Additional Shares that such non-defaulting
Underwriters would have been obligated to purchase in the absence of such
default. Any action taken under this Section 11 shall not relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them,
because of any failure or refusal on the part of any Seller to comply with the
terms or to fulfill any of the conditions of this Agreement, or if for any
reason any Seller shall be unable to perform its obligations under this
Agreement, the Sellers will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
12. COUNTERPARTS. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
13. APPLICABLE LAW. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Illinois.
25
14. Headings. The Headings of the Sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
Very truly yours,
MARKET FACTS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Controller
MFI INVESTORS L.P.,
a Delaware limited partnership
By: MFI ASSOCIATES, INC.,
its sole general partner
By: /s/ Xxxxxxx X. Oyster
-------------------------------
Name: Xxxxxxx X. Oyster
Title: V.P.
Accepted, as of the date hereof
EVEREN SECURITIES, INC.
THE XXXXXXXX-XXXXXXXX COMPANY, LLC
Acting severally on behalf of themselves and the
several Underwriters named in SCHEDULE I hereto.
By: EVEREN SECURITIES, INC.
By: /s/ Xxxxx X. Xxxxxx
-------------------
Name: Xxxxx X. Xxxxxx
Title: Managing Director
26
SCHEDULE I
Underwriters
------------
Number of
Firm Shares
Underwriter To Be Purchased
----------- ---------------
EVEREN Securities, Inc................................... 798,000
The Xxxxxxxx-Xxxxxxxx Company, LLC....................... 798,000
ABN AMRO Chicago Corporation............................. 96,000
BancAmerica Xxxxxxxxx Xxxxxxxx........................... 96,000
Xxxxxxx Xxxxx & Company, L.L.C........................... 96,000
Xxxxxxxxx & Xxxxx LLC.................................... 96,000
Xxxxxx X. Xxxxx & Co. Incorporated....................... 60,000
Xxxxxx Xxxx LLC.......................................... 60,000
Ladenburg Xxxxxxxx & Co. Inc............................. 60,000
Mesirow Financial, Inc................................... 60,000
Xxxxxxx & Company, Inc................................... 60,000
Xxxxxxx Xxxxx Securities Inc............................. 60,000
Xxxxxxxx Inc............................................. 60,000
---------
Total Firm Shares................................... 2,400,000
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