[_____________]
XXXXXX XXXXX CORP.
Common Stock
FORM OF INTERNATIONAL UNDERWRITING AGREEMENT
--------------------------------------------
_______ __, 1997
XXXXX XXXXXX INC.
XXXXXXX XXXXX INTERNATIONAL
PAINEWEBBER INTERNATIONAL
As Lead Managers for the Several Managers
c/o XXXXX XXXXXX INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Xxxxxx Xxxxx Corp., a New York corporation (together with its
successor by merger to Xxxxxx Xxxxx Inc., a Pennsylvania corporation that upon
effectiveness of the merger will change its name to Xxxxxx Xxxxx Corp., the
"Company"), proposes to issue and sell an aggregate of _______ shares of its
common stock, par value $0.01 per share, and the persons named in Part A of
Schedule I hereto (the "Selling Shareholders") propose to sell an aggregate of
_______ shares of common stock of the Company (together with the _______ shares
of common stock to be issued and sold by the Company, the "Shares") to the
several Underwriters named in Schedule II hereto (the "Managers") for whom Xxxxx
Xxxxxx Inc., Xxxxxxx Xxxxx International and PaineWebber International are
acting as representatives (the "Lead Managers"). The Company and the Selling
Shareholders are hereinafter sometimes referred to as the "Sellers." The
Company's common stock, par value $0.01 per share, including the Shares and the
U.S. Shares (as defined herein), is hereinafter referred to as the "Common
Stock."
It is understood that the Company and the Selling Shareholders are
concurrently entering into a U.S. Underwriting Agreement, dated the date hereof
(the "U.S. Underwriting Agreement"), providing for the sale of _________ shares
of the Common Stock (the "U.S. Firm Shares"), of which _________ shares will be
sold by the Company and _________ will be sold by the Selling Shareholders (plus
an option granted by the Company to purchase up to an additional _______ shares
of Common Stock (the
"Additional U.S. Shares") solely for the purpose of covering over-allotments)
through arrangements with certain underwriters in the United States and Canada
(the "U.S. Underwriters"), for whom Xxxxx Xxxxxx Inc., Xxxxxxx, Xxxxx & Co. and
PaineWebber Incorporated are acting as representatives (the "Representatives").
All shares of Common Stock proposed to be offered to U.S. Underwriters pursuant
to the U.S. Underwriting Agreement, including the U.S. Firm Shares and the
Additional U.S. Shares, are herein called the "U.S. Shares"; the U.S. Shares and
the Shares, collectively, are herein called the "Underwritten Shares."
The Company and the Selling Shareholders also understand that the
Lead Managers and the Representatives have entered into an agreement (the
"Agreement Between U.S. Underwriters and Managers") contemplating the
coordination of certain transactions between the Managers and the U.S.
Underwriters and that, pursuant thereto and subject to the conditions set forth
therein, the Managers may purchase from U.S. Underwriters a portion of the U.S.
Shares or sell to the Managers a portion of the Shares. The Company and the
Selling Shareholders understand that any such purchases and sales between the
Managers and the U.S. Underwriters shall be governed by the Agreement Between
U.S. Underwriters and Managers and shall not be governed by the terms of this
Agreement or the U.S. Underwriting Agreement.
The Company and the Selling Shareholders wish to confirm as follows
their respective agreements with you and the other several Managers on whose
behalf you are acting, in connection with the several purchases of the Shares by
the Underwriters.
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 prospectuses subject to
completion, relating to the Underwritten 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. If an
abbreviated registration statement is prepared and filed with the Commission in
accordance with Rule 462(b) under the Act ("an Abbreviated Registration
Statement"), the term "Registration Statement" as used in this Agreement
includes the Abbreviated
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Registration Statement. The term "Prospectuses" as used in this Agreement means
the prospectuses in the forms included in the Registration Statement, or, if the
prospectuses included in the Registration Statement omit information in reliance
on Rule 430A under the Act and such information is included in prospectuses
filed with the Commission pursuant to Rule 424(b) under the Act, the term
"Prospectuses" as used in this Agreement means the prospectuses in the forms
included in the Registration Statement as supplemented by the addition of the
Rule 430A information contained in the prospectuses filed with the Commission
pursuant to Rule 424(b). The term "Prepricing Prospectuses" as used in this
Agreement means the prospectuses subject to completion in the forms included in
the Registration Statement at the time of the initial filing of the Registration
Statement with the Commission, and as such prospectuses shall have been amended
from time to time prior to the date of the Prospectuses.
It is understood that two forms of Prepricing Prospectus and two
forms of Prospectus are to be used in connection with the offering and sale of
the Underwritten Shares: a Prepricing Prospectus and a Prospectus relating to
the U.S. Shares that are to be offered and sold in the United States (as defined
herein) or Canada (as defined herein) or to U.S. or Canadian Persons (the "U.S.
Prepricing Prospectus" and the "U.S. Prospectus," respectively), and a
Prepricing Prospectus and a Prospectus relating to the International Shares
which are to be offered and sold outside the United States or Canada to persons
other than U.S. or Canadian Persons (the "International Prepricing Prospectus"
and the "International Prospectus," respectively). The U.S. Prospectus and the
International Prospectus are herein collectively called the "Prospectuses," and
the U.S. Prepricing Prospectus and the International Prepricing Prospectus are
herein called the "Prepricing Prospectuses." For purposes of this Agreement:
"Rules and Regulations" means the rules and regulations adopted by the
Commission under either the Act or the Securities Exchange Act of 1934, as
amended (the "Exchange Act") as applicable; "U.S. or Canadian Person" means any
resident or national of the United States or Canada, any corporation,
partnership or other entity created or organized in or under the laws of the
United States or Canada or any estate or trust the income of which is subject to
United States or Canadian income taxation regardless of the source of its income
(other than the foreign branch of any U.S. or Canadian Person), and includes any
United States or Canadian branch of a person other than a U.S. or Canadian
Person; "United States" means the United States of America (including the states
thereof and the District of Columbia) and its territories, its possessions and
other areas subject to its jurisdiction; and "Canada" means Canada and its
territories, its possessions and other areas subject to its jurisdiction.
2. Agreements to Sell and Purchase. Subject to such adjustments as you
may determine to avoid fractional shares, the Company hereby agrees, subject to
all the terms and conditions set
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forth herein, to issue and sell to each Manager and, upon the basis of this
representations, warranties and agreements of the Company and the Selling
Shareholders herein contained and subject to all the terms and conditions set
forth herein, each Manager agrees, severally and not jointly, to purchase from
the Company, at a purchase price of $______ per share (the "purchase price per
share"), the number of Shares that bears the same proportion to the
aggregate number of Shares to be issued and sold by the Company as the
number of Shares set forth opposite the name of such Manager in Schedule II
hereto (or such number of Shares increased as set forth in Section 12
hereof) bears to the aggregate number of Shares to be sold by the Company
and the Selling Shareholders.
Subject to such adjustments as you may determine to avoid fractional
shares, each Selling Shareholder agrees, subject to all the terms and conditions
set forth herein, to sell to each Manager and, upon the basis of the
representations, warranties and agreements of the Company and the Selling
Shareholders herein contained and subject to all the terms and conditions set
forth herein, each Manager agrees, severally and not jointly, to purchase from
each Selling Shareholder, at the purchase price per share, the number of Firm
Shares that bears the same proportion to the number of Shares set forth
opposite the name of such Selling Shareholder in Schedule I hereto as the number
of Shares set forth opposite the name of such Manager in Schedule II hereto
(or such number of Shares increased as set forth in Section 12 hereof)
bears to the aggregate number of Shares to be sold by the Company and the
Selling Shareholders.
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Certificates in transferable form for the Shares that each of the Selling
Shareholders agrees to sell pursuant to this Agreement have been placed in
custody with [ ] (the "Custodian") for delivery under this Agreement
pursuant to a Custody Agreement and Power of Attorney (the "Custody Agreement")
executed by each of the Selling Shareholders appointing ______________________
and ____________________________, as agents and attorneys-in-fact (the
"Attorneys-in-Fact"). Each Selling Shareholder agrees that (i) the Shares
represented by the certificates held in custody pursuant to the Custody
Agreement are subject to the interests of the Managers, the Company and each
other Selling Shareholder, (ii) the arrangements made by the Selling
Shareholders for such custody are, except as specifically provided in the
Custody Agreement, irrevocable, and (iii) the obligations of the Selling
Shareholders hereunder and under the Custody Agreement shall not be terminated
by any act of such Selling Shareholder or by operation of law, whether by the
death or incapacity of any Selling Shareholder or the occurrence of any other
event or, if the Selling Shareholder is not a natural person, upon any
dissolution, winding up, distribution of assets or other event affecting the
legal existence of such Selling Shareholder. If any Selling Shareholder shall
die or be incapacitated or if any other event shall occur before the delivery of
the Shares hereunder, or if the Selling Shareholder is not a natural person,
shall dissolve, wind up, distribute assets or if any other event affecting the
legal existence of such Selling Shareholder shall occur before the delivery of
the Shares hereunder, certificates for the Shares of such Selling Shareholder
shall be delivered to the Underwriters by the Attorneys-in-Fact in accordance
with the terms and conditions of this Agreement and the Custody Agreement as if
such death or incapacity, dissolution, winding up or distribution of assets or
other event had not occurred, regardless of whether or not the Attorneys-in-Fact
or any Manager shall have received notice of such death, incapacity,
dissolution, winding up or distribution of assets or other event. Each
Attorney-in-Fact is authorized, on behalf of each of the Selling Shareholders,
to execute this Agreement and any other documents necessary or desirable in
connection with the sale of the Shares to be sold hereunder by such Selling
Shareholder, to make delivery of the certificates for such Shares, to receive
the proceeds of the sale of such Shares, to give receipts for such proceeds, to
pay therefrom any expenses to be borne by such Selling Shareholder in connection
with the sale and public offering of such Shares, to distribute the balance
thereof to such Selling Shareholder, and to take such other action as may be
necessary or desirable in connection with the transactions contemplated by this
Agreement. Each Attorney-in-Fact agrees to perform his duties under the Custody
Agreement.
3. Terms of Public Offering. The Sellers have been advised by you that
the Managers 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
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judgment is advisable and initially to offer the Shares upon the terms set forth
in the International Prospectus.
4. Delivery of the Shares and Payment Therefor. Delivery to the Managers
of and payment for the Shares shall be made at the office of Xxxxx Xxxxxx
Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, X.X. 00000, at 10:00 A.M., New York City
time, on ___________, 1997 (the "Closing Date"). The place of closing for the
Shares and the Closing Date may be varied by agreement among you, the
Company and the Attorneys-in-Fact.
Certificates for the Shares to be purchased hereunder shall be
registered in such names and in such denominations as you shall request by
written notice, it being understood that a facsimile transmission shall be
deemed written notice, prior to 9:30 A.M., New York City time, on the second
business day preceding the Closing Date. Such certificates shall be made
available to you in New York City for inspection and packaging not later than
9:30 A.M., New York City time, on the business day next preceding the Closing
Date. The certificates and stock powers evidencing the Shares to be
purchased hereunder shall be delivered to you on the Closing Date against
payment of the purchase price therefor in immediately available funds.
5. Agreements of the Company. The Company agrees with the several
Managers as follows:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or a post-effective amendment thereto
to be declared effective before the offering of the Shares may commence, the
Company will endeavor to cause the Registration Statement or such post-effective
amendment to become effective as soon as possible and will advise you promptly
and, if requested by you, will confirm such advice in writing, when the
Registration Statement or such post-effective amendment has become effective.
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(b) The Company will advise you promptly and, if requested by you,
will confirm such advice in writing: (i) of any request by the Commission for
amendment of or a supplement to the Registration Statement, any Prepricing
Prospectuses or the Prospectuses 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 purpose; and (iii) within the period of time referred to in paragraph (f)
below, of any change in the Company's condition (financial or other), business,
prospects, properties, net worth or results of operations, or of the happening
of any event, including the filing of any information, documents or reports
pursuant to the Exchange Act, that makes any statement of a material fact made
in the Registration Statement or the Prospectuses (as then amended or
supplemented) untrue or which requires the making of any additions to or changes
in the Registration Statement or the Prospectuses (as then amended or
supplemented) in order to state a material fact required by the Act or the
regulations thereunder to be stated therein or necessary in order to make the
statements therein not misleading, or of the necessity to amend or supplement
the Prospectuses (as then amended or supplemented) to comply with the Act or any
other law. If at any time the Commission shall issue any stop order suspending
the effectiveness of the Registration Statement, the Company will make every
reasonable effort to obtain the withdrawal of such order at the earliest
possible time.
(c) The Company will furnish to you, without charge three signed
copies of the Registration Statement as originally filed with the Commission and
of each amendment thereto, including financial statements and all exhibits to
the Registration Statement and will also furnish to you, without charge, such
number of conformed copies of the Registration Statement as originally filed and
of each amendment thereto, but without exhibits, as you may reasonably request.
(d) The Company will not (i) file any amendment to the Registration
Statement or make any amendment or supplement to the Prospectuses of which you
shall not previously have been advised or to which you shall reasonably object
in writing after being so advised or (ii) so long as, in the written opinion of
counsel for the Managers (a copy of which shall be delivered to the Company), a
prospectus is required to be delivered in connection with sales by any Manager
or dealer, file any information, documents or reports pursuant to the Exchange
Act, without delivering a copy of such information, documents or reports, to
you, as Lead Managers for the Managers, prior to or concurrently with such
filing.
(e) Prior to the execution and delivery of this Agreement, the
Company has delivered or will deliver to you, without charge, in such quantities
as you have reasonably requested or may hereafter reasonably request, copies of
each form of the
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International Prepricing Prospectus. The Company consents to the use, in
accordance with the provisions of the Act and with the securities laws of the
jurisdictions in which the Shares are offered by the several Managers and by
dealers, prior to the date of the International Prospectus, of each
International Prepricing Prospectus so furnished by the Company.
(f) As soon after the execution and delivery of this Agreement as
possible and thereafter from time to time for such period as in the written
opinion of counsel for the Managers an International Prospectus is required by
the Act to be delivered in connection with sales by any Manager or dealer, the
Company will expeditiously deliver to each Manager and each dealer, without
charge, as many copies of the International Prospectus (and of any amendment or
supplement thereto) as you may reasonably request. The Company consents to the
use of the International Prospectus (and of any amendment or supplement thereto)
in accordance with the provisions of the Act and with the securities laws of the
jurisdictions in which the Shares are offered by the several Managers and by all
dealers to whom Shares may be sold, both in connection with the offering and
sale of the Shares and for such period of time thereafter as the International
Prospectus is required by the Act to be delivered in connection with sales by
any Manager or dealer. If during such period of time any event shall occur that
in the judgment of the Company or in the written opinion of counsel for the
Managers is required to be set forth in the International Prospectus (as then
amended or supplemented) or should be set forth therein in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary to supplement or amend the
International Prospectus in order to comply with the Act or any other law, the
Company will make every reasonable effort to prepare and, subject to the
provisions of paragraph (d) above, file with the Commission an appropriate
supplement or amendment thereto, and will expeditiously furnish to the Managers
and dealers a reasonable number of copies thereof. In the event that the Company
and you, as Lead Managers for the several Managers, agree that the International
Prospectus should be amended or supplemented, the Company, if requested by you,
will promptly issue a press release announcing or disclosing the matters to be
covered by the proposed amendment or supplement.
(g) The Company will cooperate with you and with counsel for the
Managers in connection with the registration or qualification of the Shares for
offering and sale by the several Managers and by dealers under the securities
laws of such jurisdictions as you may reasonably designate and will file such
consents to service of process or other documents necessary or appropriate in
order to effect such registration or qualification; provided that in no event
shall the Company be obligated to qualify to do business in any jurisdiction
where it is not now so qualified or to take any action that would subject it to
taxation or service of process in suits, other than those arising out of the
offering
8
or sale of the Shares, in any jurisdiction where it is not now so subject.
(h) The Company will make generally available to its security
holders a consolidated earnings statement, which need not be audited, covering a
twelve-month period commencing after the effective date of the Registration
Statement and ending not later than 15 months thereafter, as soon as reasonably
practicable after the end of such period, which consolidated earnings statement
shall satisfy the provisions of Section 11(a) of the Act.
(i) During the period of five years hereafter, the Company will
furnish to you (i) as soon as available, a copy of each report of the Company
mailed to stockholders or filed with the Commission or the New York Stock
Exchange, and (ii) from time to time such other information concerning the
Company as you may reasonably request.
(j) If this Agreement shall terminate or shall be terminated after
execution pursuant to any provisions hereof (otherwise than pursuant to the
second paragraph of Section 12 hereof or by notice given by you terminating this
Agreement pursuant to Section 12 or Section 13 hereof) or if this Agreement
shall be terminated by the Managers because of any failure or refusal on the
part of the Company or any of the Selling Shareholders to comply, in any
material respect, with the terms or fulfill, in any material respect of any of
the conditions of this Agreement, the Company agrees to reimburse the Lead
Managers for all reasonable out-of-pocket expenses (including reasonable fees
and expenses of counsel for the Managers) incurred by you in connection
herewith.
(k) The Company will apply the net proceeds from the sale of the
Shares to be sold by it hereunder substantially in accordance with the
description set forth in the Prospectuses.
(l) If Rule 430A of the Act is employed, the Company will make every
reasonable effort to timely file the Prospectuses pursuant to Rule 424(b) under
the Act and will advise you of the time and manner of such filing.
(m) For a period of 180 days after the date hereof (the "Lock-up
Period"), the Company will not, without the prior written consent of Xxxxx
Xxxxxx Inc., offer, sell, contract to sell or otherwise dispose of any Common
Stock (or any securities convertible into or exercisable or exchangeable for
Common Stock) or grant any options or warrants to purchase Common Stock that are
exercisable during the Lock-up Period, except for (i) sales to the Managers
pursuant to this Agreement and the U.S. Underwriters pursuant to the U.S.
Underwriting Agreement, (ii) the issuance of shares upon exercise of outstanding
options and [(iii) the issuance of shares in connection with acquisitions,
provided that the
9
recipients of such shares agree not to sell the shares during the Lock-up
Period.
(n) The Company has furnished or will furnish to you "lock-up"
letters, in form and substance satisfactory to you, signed by each of its
current executive officers and directors and each of its stockholders designated
by you.
(o) Except as stated in this Agreement and in the U.S. Underwriting
Agreement and in the Prepricing Prospectuses and Prospectuses, the Company has
not taken, nor will it take, directly or indirectly, any action designed to or
that might reasonably be expected to cause or result in stabilization or
manipulation of the price of the Common Stock to facilitate the sale or resale
of the Shares.
(p) The Company will use its best efforts to have the Common Stock
listed, subject to notice of issuance, on the New York Stock Exchange
concurrently with the effectiveness of the Registration Statement.
(q) The Company will use its best efforts to satisfy on or before
the Closing Date all conditions to the Managers' obligations to purchase the
Shares.
6. Agreements of the Selling Shareholders. Each of the Selling
Shareholders agrees with the several Managers as follows:
(a) Such Selling Shareholder will cooperate to the extent reasonably
necessary to cause the Registration Statement or any post-effective amendment
thereto to become effective at the earliest possible time.
(b) Such Selling Shareholder will pay all Federal and other taxes,
if any on the transfer or sale of such Shares that are sold by the Selling
Shareholder to the Managers.
(c) Such Selling Shareholder will do or perform all things required
to be done or performed by the Selling Shareholder prior to the Closing Date to
satisfy all conditions precedent to the delivery of the Shares pursuant to this
Agreement.
(d) Such Selling Shareholder has executed or will execute a "lock-
up" letter as provided in Section 5(n) above and will not sell, contract to sell
or otherwise dispose of any Common Stock, except as provided therein or for the
sale of Shares to the Underwriters pursuant to this Agreement, prior to the
expiration of 180 days after the date of the Prospectus, without the prior
written consent of Xxxxx Xxxxxx Inc.
(e) Except as stated in this Agreement and the U.S. Underwriting
Agreement and in the Prepricing Prospectuses and the
10
Prospectuses, such Selling Shareholder has not taken, nor will it take, directly
or indirectly, any action designed to or that might reasonably be expected to
cause or result in stabilization or manipulation of the price of the Common
Stock to facilitate the sale or resale of the Shares.
(f) To the extent that any statements or omissions made in the
Registration Statement or the Prospectuses (as amended or supplemented, if
amended or supplemented) specifically refer to the information regarding a
Selling Shareholder under the caption "Principal and Selling Shareholders," such
Selling Shareholder will advise you promptly, upon becoming aware, and if
requested by you, will confirm such advice in writing, within the period of time
referred to in Section 5(f) hereof, of any change in such information that comes
to the attention of such Selling Shareholder that makes any statement made in
the Registration Statement or the Prospectuses (as then amended or supplemented)
untrue or which requires the making of any additions to or changes in the
Registration Statement or the Prospectuses (as then amended or supplemented) in
order to state a material fact required by the Act or the regulations thereunder
to be stated therein or necessary in order to make the statements therein not
misleading, or of the necessity to amend or supplement the Prospectuses (as then
amended or supplemented) to comply with the Act or any other law.
7. Representations and Warranties of the Company. The Company represents
and warrants to each Manager that:
(a) Each International Prepricing Prospectus included as part of the
registration statement as originally filed or as part of any amendment or
supplement thereto, or filed pursuant to Rule 424 under the Act, complied when
so filed in all material respects with the provisions of the Act; except that
this representation and warranty does not apply to statements in or omissions
from such International Prepricing Prospectus (or any amendment or supplement
thereto) made in reliance upon and in conformity with information relating to
any Selling Shareholder or to any U.S. Underwriter or Manager furnished to the
Company in writing by a Manager through the Lead Managers or by a Manager
through the Lead Managers expressly for use therein. The Commission has not
issued any order preventing or suspending the use of any Prepricing Prospectus.
(b) The Registration Statement in the form in which it became or
becomes effective, including the information deemed to be part of the
Registration Statement at the time of effectiveness pursuant to Rule 430A(b),
and also in such form as it may be when any post-effective amendment thereto
shall become effective and the Prospectuses and any supplement or amendment
thereto when filed with the Commission under Rule 424(b) under the Act, complied
or will comply in all material respects with the provisions of the Act and will
not at any such times 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 not misleading; except that this representation and warranty
does not apply to statements in or omissions from the Registration Statement or
the Prospectuses made in reliance upon and in conformity with
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information relating to any Selling Shareholder or to any U.S. Underwriter or
Manager furnished to the Company in writing by or on behalf of a Manager through
the Lead Managers or by a U.S. Underwriter through the Representatives expressly
for use therein.
(c) All the outstanding shares of Common Stock of the Company have
been duly authorized and validly issued, are fully paid and nonassessable and
are free of any preemptive or similar rights; the Shares to be issued and sold
by the Company have been duly authorized and, when issued and delivered to the
Managers against payment therefor in accordance with the terms hereof, will be
validly issued, fully paid and nonassessable and free of any preemptive or
similar rights; and the capital stock of the Company conforms to the description
thereof in the Registration Statement and the Prospectuses.
(d) The Company is a corporation duly organized and validly existing
in good standing under the laws of the State of New York, and within fourteen
days of the Closing Date will be a corporation duly organized and validly
subsisting under the Commonwealth of Pennsylvania with full corporate power and
authority to own, lease and operate its properties and to conduct its business
as described in the Registration Statement and the Prospectuses, and is duly
registered and qualified to conduct its business and is in good standing in each
jurisdiction where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure so to
register or qualify does not and will not (1) have a material adverse effect on
the condition (financial or other), business affairs, prospects, properties,
shareholders' equity or results of operations of the Company and the
Subsidiaries (as hereinafter defined) taken as a whole, (2) adversely affect the
issuance, validity or enforceability of the Shares or (3) adversely affect the
consummation of any of the transactions contemplated by this Agreement (each of
(1), (2) and (3) above, a "Material Adverse Effect").
(e) All the Company's subsidiaries (as defined in Rule 1-02(x) of
Regulation S-X and as required to be identified by Item 601(b)(21) of Regulation
S-K are listed in an exhibit to the Registration Statement (collectively, the
"Subsidiaries"). Each Subsidiary is either (i) a corporation duly organized,
validly existing and in good standing in the jurisdiction of its incorporation
or (ii) a partnership duly organized and validly existing under the applicable
laws of the Commonwealth of Pennsylvania. Each Subsidiary has the requisite
corporate or partnership, as the case may be, and authority to own, lease and
operate its properties and to conduct its business as described in the
Registration Statement and the Prospectuses, and is duly registered and
qualified to conduct its business and is in good standing in each jurisdiction
or place where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure so to
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register or qualify does not and will not individually or in the aggregate have
a Material Adverse Effect. All the outstanding shares of capital stock of each
of the corporate Subsidiaries have been duly authorized and validly issued, are
fully paid and nonassessable, and are owned by the Company directly, or
indirectly through one or more of the other Subsidiaries, free and clear of any
lien, adverse claim, security interest, equity or other encumbrance, except that
Xxxxxx Xxxxx Command Company is only 99% owned (indirectly) by the Company.
(f) There are no legal or governmental proceedings pending or, to
the knowledge of the Company, threatened, against the Company or any of its
Subsidiaries which are materially adverse to the Company and its Subsidiaries,
taken as a whole, or to which the Company or any of the Subsidiaries, or to
which any of their respective properties is subject, which are material to the
Company and its Subsidiaries, taken as a whole, that are required to be
described in the Registration Statement or the Prospectuses but are not
described as required, and there are no agreements, contracts, indentures,
leases or other instruments relating to the Company that are required to be
described in the Registration Statement or the Prospectuses or to be filed as an
exhibit to the Registration Statement that are not described or filed as
required by the Act or the Exchange Act. The descriptions of the terms of any
such agreements, contracts, indentures, leases or other instruments contained in
the Registration Statement or the Prospectuses are correct in all material
respects.
(g) Neither the Company nor any of the Subsidiaries is in (i)
violation of its certificate or articles of incorporation or by-laws, or other
organizational documents, (ii) in violation of any statute, law, ordinance,
administrative or governmental rule or regulation applicable to the Company or
any of the Subsidiaries of any ruling, judgment, injunction, order or decree of
any court or governmental agency or body having jurisdiction over the Company or
any of the Subsidiaries (except where any such violation or violations in the
aggregate would not have a Material Adverse Effect), or (iii) in default in any
material respect in the performance of any obligation, agreement or condition
contained in any bond, debenture, note or any other evidence of indebtedness or
in any material agreement, indenture, lease or other instrument to which the
Company or any of the Subsidiaries is a party or by which any of them or any of
their respective properties may be bound, and no condition or state of facts
exists, which with the passage of time or the giving of notice or both, would
constitute such a default (except where any such default or defaults in the
aggregate would not have a Material Adverse Effect).
(h) Neither the issuance and sale of the Shares, the execution,
delivery or performance of this Agreement or the U.S. Underwriting Agreement by
the Company nor the consummation by the Company of the transactions contemplated
hereby and thereby (i) requires any consent, approval, authorization or other
order of or
13
registration or filing with, any court, regulatory body, administrative agency
or other governmental body, agency or official (except as may be required for
the registration of the Shares under the Act and the Exchange Act (which has
been effected) and such as may be required under state or foreign securities
laws) or conflicts or will conflict with or constitutes or will constitute a
breach of, or a default under, the certificate or articles of incorporation or
bylaws, or other organizational documents, of the Company or any of the
Subsidiaries or (ii) conflicts or will conflict with or constitutes or will
constitute a breach of, or a default under, any agreement, indenture, lease or
other instrument to which the Company or any of the Subsidiaries is a party or
by which any of them or any of their respective properties may be bound, or
violates or will violate any statute, law, regulation or filing (except as may
be required for the registration of the Shares under the Act and the Exchange
Act (which has been effected) and such as may be required under state or foreign
securities laws) or judgment, injunction, order or decree applicable to the
Company or any of the Subsidiaries or any of their respective properties, or
will result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any of the Subsidiaries pursuant
to the terms of any agreement or instrument to which any of them is a party or
by which any of them may be bound or to which any of the property or assets of
any of them is subject other than security interests granted pursuant to the
Credit Agreement.
(i) The accountants, Xxxxxx Xxxxxxxx LLP and Deloitte & Touche LLP,
who have certified or shall certify the financial statements filed or to be
filed as part of the Registration Statement or the Prospectuses (or any
amendment or supplement thereto) are independent public accountants as required
by the Act.
(j) The historical consolidated financial statements of the Company,
together with related schedules and notes forming part of the Registration
Statement and the Prospectuses (and any amendment or supplement thereto), and,
to the knowledge of the Company, the historical financial statements of Security
Archives, Inc. and Records Management Services, Inc., together with related
schedules and notes forming part of the Registration Statement and the
Prospectuses (and any amendment or supplement thereto), comply with the
requirements of the Act and present fairly the consolidated financial position,
results of operations, cash flows and changes in financial position of the
Company and the Subsidiaries and Security Archives, Inc. and Records Management
Services, Inc., as the case may be, on the basis stated in the Registration
Statement at the respective dates or for the respective periods to which they
apply; the statements and related schedules and notes of the Company and, to the
knowledge of the Company, the statements and related schedules and notes of
Security Archives, Inc. and Records Management Services, Inc., have been
prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved,
14
except as disclosed therein; the pro forma financial information, and the
related notes thereto, included in the Registration Statement and the
Prospectuses (and any amendment or supplement thereto) have been prepared in
accordance with the applicable requirements of the Act and the assumptions used
in preparing such information are reasonable; and the other historical and pro
forma financial and statistical information and data set forth in the
Registration Statement and the Prospectuses (and any amendment or supplement
thereto) are accurately presented and prepared on a basis consistent with the
books and records of the Company and its Subsidiaries.
(k) The execution and delivery of, and the performance by the
Company of its obligations under, each of this Agreement and the U.S.
Underwriting Agreement have been duly and validly authorized by the Company, and
each of this Agreement and the U.S. Underwriting Agreement has been duly
executed and delivered by the Company and constitutes the valid and legally
binding agreement of the Company, enforceable against the Company in accordance
with its terms, except (i) the enforceability hereof or thereof may be limited
by bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or
other similar laws now or hereafter in effect relating to creditors' rights
generally, (ii) the remedy of specific performance and other forms of equitable
relief may be subject to certain equitable defenses and to the discretion of the
court before which the proceedings may be brought and (iii) rights to indemnity
and contribution hereunder or thereunder may be limited by federal or state
securities laws or the public policy underlying such laws.
(l) Except as disclosed in the Registration Statement and the
Prospectuses (or any amendment or supplement thereto), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectuses (or any amendment or supplement thereto), neither
the Company nor any of the Subsidiaries has incurred any liability or
obligation, direct or contingent, or entered into any transaction, not in the
ordinary course of business, that is material to the Company and the
Subsidiaries taken as a whole, and there has not been any change in the capital
stock of the Company, or material increase in the short-term debt or long-term
debt, of the Company or any of the Subsidiaries, or any development having or
which may reasonably be expected to involve, a prospective Material Adverse
Effect.
(m) Each of the Company and the Subsidiaries has good and valid
title to all property (real and personal) described in the Prospectuses as being
owned by it which is material to the business of the Company and its
Subsidiaries taken as a whole, free and clear of all liens, claims, security
interests or other encumbrances except such as are described in the Registration
Statement and the Prospectuses or in a document filed as an exhibit to the
Registration Statement and all the property described in the Prospectuses as
being held under lease by each of the Company and
15
the Subsidiaries which is material to the business of the Company and its
Subsidiaries taken as a whole, is held by it under valid, subsisting and
enforceable leases with only such exceptions as in the aggregate do not
interfere in any material respect with the conduct of the business of the
Company and the Subsidiaries, taken as a whole or the use made or proposed to be
made of such property by the Company or its Subsidiaries.
(n) The Company has not distributed and, prior to the later to occur
of (i) the Closing Date or the Option Closing Date, if any, and (ii) completion
of the distribution of the Shares, will not distribute any offering material in
connection with the offering and sale of the Shares other than the Registration
Statement, the Prepricing Prospectuses, the Prospectuses or other materials, if
any, permitted by the Act.
(o) Except as described in clause (d) above, the Company and each of
the Subsidiaries has such permits, licenses, franchises and authorizations of
governmental or regulatory authorities ("Permits") as are necessary to own its
respective properties and to conduct its business in the manner described in the
Prospectuses, except where the failure to so possess would not, individually or
in the aggregate, have a Material Adverse Effect and subject to such
qualifications as may be set forth in the Prospectuses; the Company and each of
the Subsidiaries has fulfilled and performed all its material obligations with
respect to such Permits and no event has occurred that allows, or after notice
or lapse of time would allow, revocation or termination thereof or results in
any other material impairment of the rights of the holder of any such Permit,
subject in each case to such qualification as may be set forth in the
Prospectuses, except where any such revocation, termination or impairment would
not have a Material Adverse Effect; and, except as described in the
Prospectuses, none of such Permits contains any restriction that is materially
burdensome to the Company or any of the Subsidiaries.
(p) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are executed
in accordance with management's general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets; (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 existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(q) To the Company's knowledge, neither the Company nor any of its
Subsidiaries nor any employee or agent of the Company or any Subsidiary has made
any payment of funds of the Company or any Subsidiary or received or retained
any funds in violation of any law, rule or regulation, which payment, receipt or
retention of
16
funds is of a character required to be disclosed in the Prospectuses.
(r) The Company, and to the Company's knowledge, each of the
Subsidiaries have filed all tax returns required to be filed, which returns are
true and correct in all material respects or extensions therefor, and neither
the Company nor any Subsidiary is in default in the payment of any taxes which
were payable pursuant to said returns or any assessments with respect thereto,
except where the failure to file such returns or to pay such taxes is not
reasonably likely to have a Material Adverse Effect.
(s) Except as described in the Prospectuses, 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 because of the filing of the
Registration Statement or consummation of the transactions contemplated by this
Agreement or the U.S. Underwriting Agreement, or otherwise. Except as described
in or contemplated by the Prospectuses, there are no outstanding options,
warrants or other rights calling for the issuance of, and there are no
commitments, plans or arrangements to issue, any shares of Common Stock of the
Company or any security convertible into or exchangeable or exercisable for
Common Stock of the Company.
(t) The Company and the Subsidiaries own or possess all patents,
trademarks, trademark registration, service marks, service xxxx registrations,
trade names, copyrights, licenses, inventions, trade secrets and rights
described in the Prospectuses as being owned by them or any of them or necessary
for the conduct of their respective businesses, except where the lack of such
ownership or possession would not, individually or in the aggregate, have a
Material Adverse Effect, and the Company is not aware of any claim to the
contrary or any challenge by any other person to the rights of the Company and
the Subsidiaries with respect to the foregoing.
(u) The Company is not and, upon sale of the Shares to be issued and
sold in accordance herewith and upon application of the net proceeds to the
Company from such sale as described in the Prospectuses under the caption "Use
of Proceeds," will not be an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
(v) The Company and the Subsidiaries have complied with all
provisions of Florida Statutes, (S)517.075, relating to issuers doing business
with Cuba.
(w) The businesses of the Company and the Subsidiaries as presently
conducted and as described in the Prospectuses comply with all statutes, laws,
ordinances, administrative or governmental rules or regulations applicable to
the Company or any of the Subsidiaries (collectively, "Laws") and with all
orders, rulings, judgments, injunctions or decrees of any court or governmental
17
agency or body having jurisdiction over the Company or any of the Subsidiaries,
except for any failure to comply which would not, individually or in the
aggregate, have a Material Adverse Effect.
(x) The Company and each of its Subsidiaries are insured by insurers
of recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which they 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 have a Material Adverse Effect, except as
described in or contemplated by the Prospectuses.
(y) No Subsidiary of the Company is currently prohibited, directly or
indirectly, from paying any dividends to the Company, from making any other
distribution on such Subsidiary's capital stock, from repaying to the Company
any loans or advances to such Subsidiary from the Company or from transferring
any of such Subsidiary's property or assets to the Company or any other
Subsidiary of the Company, except as described in or contemplated by the
Prospectuses.
(z) Except for the shares of capital stock or partnership interests
of each of the Subsidiaries owned by the Company and such Subsidiaries, neither
the Company nor any such Subsidiary owns any shares of stock or any other equity
securities of any corporation or has any equity interest in any firm,
partnership, association or other entity, except as described in or contemplated
by the Prospectuses.
(aa) There are no labor disputes with the Company's employees or
with employees of the Subsidiaries that exist or, to the Company's knowledge,
are imminent that could materially adversely affect the Company and the
Subsidiaries taken as a whole, and the Company is not aware of any existing or
imminent labor disturbance by any of its or the Subsidiaries' principal
suppliers, contractors or customers that could be expected to have a Material
Adverse Effect.
(ab) With respect to each employee benefit plan, program and
arrangement (including, without limitation, any "employee benefit plan" as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA")), maintained or contributed to by the Company or the
Subsidiaries, or with respect to which the Company or the Subsidiaries could
incur any liability under ERISA (collectively, the "Benefit Plans"), no event
has occurred and there exists no condition or set of circumstances in connection
with which the Company or the Subsidiaries could be subject to any liability
under the terms of such Benefit Plan or
18
applicable law (including, without limitation, ERISA and the Internal Revenue
Code of 1986, as amended (the "Code")) that could have a Material Adverse
Effect.
(ac) The Company and the Subsidiaries are (i) (A) in full 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"), (B) have received all permits, licenses or
other approvals required of them under applicable Environmental Laws to conduct
their respective businesses, and (C) and are in full 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; (ii) except as disclosed in the Registration
Statement and the Prospectuses, there are no past or present actions,
activities, circumstances, conditions, events or incidents, including, without
limitation, the release, threatened release, or disposal of any material
(including radiation and noise), that could form the basis of any claim (whether
by a governmental authority or other person or entity) under Environmental Laws
for cleanup costs, damages, penalties, fines, or otherwise, against any of the
Company or the Subsidiaries, or against any person or entity whose liability for
such claim may have been retained by any of the Company or the Subsidiaries,
whether by contract or law; and (iii) the Company and the Subsidiaries have
fully disclosed to the Underwriters and their counsel all studies, reports,
assessments, audits and other information in their possession or control
relating to any pollution or release, threatened release or disposal of
materials regulated under Environmental Laws on, at, under, from or transported
from any of their currently or formerly owned, leased or operated properties,
including, without limitation, all information relating to underground storage
tanks and asbestos containing materials. Neither the Company nor any of the
Subsidiaries has been named as a "potentially responsible party" under the
Comprehensive Environmental Response Compensation and Liability Act of 1980, as
amended ("CERCLA").
8. Representations and Warranties of the Selling Shareholders. Each
Selling Shareholder represents and warrants to each Manager that:
(a) Such Selling Shareholder now has, and on the Closing Date will
have, valid and marketable title to the Shares to be sold by such Selling
Shareholder, free and clear of any lien, claim, security interest or other
encumbrance, including, without limitation, any restriction on transfer, except
as otherwise described in the Prospectuses.
19
(b) Such Selling Shareholder now has, and on the Closing Date will
have, full legal right, power and authorization, and any approval required by
law, to sell, assign, transfer and deliver such Shares in the manner provided in
this Agreement and the International Underwriting Agreement, and upon delivery
of and payment for such Shares hereunder, the several Managers will acquire
valid and marketable title to such Shares free and clear of any lien, claim,
security interest, or other encumbrance.
(c) This Agreement, the U.S. Underwriting Agreement and the Custody
Agreement have been duly authorized, executed and delivered by or on behalf of
such Selling Shareholder and are the valid and binding agreements of such
Selling Shareholder enforceable against such Selling Shareholder in accordance
with their terms, except that (i) the enforceability hereof or thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect relating to creditors' rights generally, (ii)
the remedy of specific performance and other forms of equitable relief may be
subject to certain equitable defenses and to the discretion of the court before
which the proceedings may be brought and (iii) rights to indemnity and
contribution hereunder or thereunder may be limited by federal or state
securities laws or the public policy underlying such laws.
(d) Neither the sale of the Shares, the execution, delivery or
performance of this Agreement, the U.S. Underwriting Agreement or the Custody
Agreement by or on behalf of such Selling Shareholder nor the consummation by or
on behalf of such Selling Shareholder of the transactions contemplated hereby
and thereby (i) requires any consent, approval, authorization or other order of,
or registration or filing with, any court, regulatory body, administrative
agency or other governmental body, agency or official (except as may be required
for the registration of the Shares under the Act and the Exchange Act (which has
been effected) and such as may be required under state or foreign securities
laws) or (ii) conflicts or will conflict with or constitutes or will constitute
a breach of, or a default under, any agreement, indenture, lease or other
instrument to which such Selling Shareholder is a party or by which such Selling
Shareholder is or may be bound, or violates or will violate any statute, law,
regulation or filing or judgment, injunction, order or decree applicable to such
Selling Shareholder, or will result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of such Selling Shareholder
pursuant to the terms of any agreement or instrument to which such Selling
Shareholder is a party or by which such Selling Shareholder may be bound or to
which any of the property or assets of such Selling Shareholder is subject.
(e) The information pertaining to such Selling Shareholder provided
to the Company for inclusion under the caption "Principal and Selling
Shareholders" in the Prospectuses, does not
20
and will not contain an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading.
(f) The representations and warranties of such Selling Shareholder
in the Custody Agreement are, and on the Closing Date and any Option Closing
Date will be, true and correct.
(g) Such Selling Shareholder has not taken directly or indirectly,
any action designed to or that might reasonably be expected to cause or result
in stabilization or manipulation of the price of the Common Stock to facilitate
the sale or resale of the Shares, except for the lock-up arrangements referred
to in the Prospectuses.
(h) Such Selling Shareholder has not distributed and, prior to the
later to occur of (i) the Closing Date and (ii) completion of the distribution
of the Shares, will not distribute any offering material in connection with the
offering and sale of the Shares.
9. Indemnification and Contribution. (a) The Company agrees to indemnify
and hold harmless you and each other Manager and each person, if any, who
controls any Manager within the meaning of Section 15 of the Act or Section
20(a) of the Exchange Act from and against any and all losses, claims, damages,
liabilities and expenses (including reasonable costs of investigation) arising
out of or based upon any untrue statement or alleged untrue statement of a
material fact contained in any International Prepricing Prospectus or in the
Registration Statement or the International Prospectus or in any amendment or
supplement thereto, or arising out of or based upon 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 expenses arise out of or are based upon
any untrue statement or omission or alleged untrue statement or omission which
has been made therein or omitted therefrom in reliance upon and in conformity
with the information relating to such U.S. Underwriter or Manager furnished in
writing to the Company by or on behalf of any Manager through you or by or on
behalf of any U.S. Underwriter through a Representative expressly for use in
connection therewith; provided, however, that the indemnification contained in
this paragraph (a) with respect to any International Prepricing Prospectus shall
not inure to the benefit of any Manager (or to the benefit of any person
controlling such Manager) on account of any such loss, claim, damage, liability
21
or expense arising from the sale of the Shares by such Manager to any person if
a copy of the International Prospectus shall not have been delivered or sent to
such person within the time required by the Act and the regulations thereunder,
and the untrue statement or alleged untrue statement or omission or alleged
omission of a material fact contained in such International Prepricing
Prospectus was corrected in the International Prospectus, provided that the
Company has delivered the International Prospectus to the several Managers in
requisite quantity on a timely basis to permit such delivery or sending.
(b) If any action, suit or proceeding shall be brought against any Manager
or any person controlling any Manager in respect of which indemnity may be
sought against the Company or any Selling Shareholder, such Manager or such
controlling person shall promptly notify the parties against whom
indemnification is being sought (the "indemnifying parties"), and such
indemnifying parties shall assume the defense thereof, including the employment
of counsel and payment of all fees and expenses; provided, however, that the
failure so to notify the indemnifying parties shall not relieve the indemnifying
parties from any obligation or liability except to the extent that the
indemnifying parties have been prejudiced materially by such failure. Such
Manager or any such controlling person shall have the right to employ separate
counsel in any such action, suit or proceeding and to participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
such Manager or such controlling person unless (i) the indemnifying parties have
agreed in writing to pay such fees and expenses, (ii) the indemnifying parties
have failed to assume the defense and employ counsel, or (iii) the named parties
to any such action, suit or proceeding (including any impleaded parties) include
both such Manager or such controlling person and the indemnifying parties and
such Manager or such controlling person shall have been advised by its counsel
in writing that representation of such indemnified party and any indemnifying
party by the same counsel would be inappropriate under applicable standards of
professional conduct (whether or not such representation by the same counsel has
been proposed) due to actual or potential differing interests between them (in
which case the indemnifying party shall not have the right to assume the defense
of such action, suit or proceeding on behalf of such Manager or such controlling
person). It is understood, however, that the indemnifying parties shall, in
connection with any one such action, suit or proceeding or separate but
substantially similar or related actions, suits or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of only one separate firm of
attorneys (in addition to any local counsel) at any time for all such Managers
and controlling persons not having actual or potential differing interests with
you or among themselves, which firm shall be designated in writing by Xxxxx
Xxxxxx Inc., and that all such fees and expenses as required to be paid by the
indemnifying parties hereunder shall be reimbursed as they are incurred. The
22
indemnifying parties shall not be liable for any settlement of any such action,
suit or proceeding effected without their written consent, but if settled with
such written consent, or if there be a final judgment for the plaintiff in any
such action, suit or proceeding, the indemnifying parties agree to indemnify and
hold harmless any Manager, to the extent provided in the preceding paragraph,
and any such controlling person from and against any loss, claim, damage,
liability or expense by reason of such settlement or judgment.
(c) Each Selling Shareholder agrees, severally and not jointly, to
indemnify and hold harmless each of you and each other Underwriter and each
person, if any, who controls any Underwriter within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act, the Company, its directors, its
officers who sign the Registration Statement, and any person who controls the
Company within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act to the same extent as the foregoing indemnity from the Company to
each Underwriter, but only with respect to the information furnished in writing
by or on behalf of such Selling Shareholder expressly for use in the
Registration Statement, the Prospectus or any Prepricing Prospectus, or any
amendment or supplement thereto; provided, however, the liability of a Selling
Shareholder under this paragraph (c) shall not exceed the proceeds received by
such Selling Shareholder from the sale of such Selling Shareholder's shares
hereunder. If any action, suit or proceeding shall be brought against any
Underwriter, any such controlling person of any Underwriter, the Company, any of
its directors any such officer or any such controlling person of the Company,
based on the Registration Statement, the Prospectus or any Prepricing Prospectus
or any amendment or supplement thereto, and in respect of which indemnity may be
sought against any Selling Shareholder pursuant to this paragraph (c), such
Selling Shareholder shall have the rights and duties given to the Company by
paragraph (b) above (except that if the Company shall have assumed the defense
thereof such Selling Shareholder shall not be required to do so, but may employ
separate counsel therein and participate in the defense thereof, but the fees
and expenses of such counsel shall be at such Selling Shareholder's expense) and
each Underwriter, each such controlling person of any Underwriter, the Company,
its directors, and such officer, and any such controlling person of the Company
shall have the rights and duties given to the Underwriters by paragraph (b)
above. The foregoing indemnity agreement shall be in addition to any liability
which any Selling Shareholder may otherwise have.
(d) Each Manager agrees, severally and not jointly, to indemnify and hold
harmless the Company, its directors, its officers who sign the Registration
Statement, any person who controls the Company within the meaning of Section 15
of the Act or Section 20(a) of the Exchange Act and the Selling Shareholders, to
the same extent as the foregoing indemnity from the Company and the Selling
Shareholders to each Manager, insofar as such losses, claims, damages,
liabilities and expenses arise out of or are based upon the untrue statement or
alleged untrue statement of a material fact contained in any International
Prepricing Prospectus or in the Registration Statement or the International
Prospectus or in any
23
amendment or supplement thereto, or arise out of or based upon 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, in each case to the
extent that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information furnished to the Company by such Manager through you specifically
for use therein. If any action, suit or proceeding shall be brought against the
Company, any of its directors, any such officer, any such controlling person or
any Selling Shareholder based on the Registration Statement, the International
Prospectus or any International Prepricing Prospectus, or any amendment or
supplement thereto, and in respect of which indemnity may be sought against any
Manager pursuant to this paragraph (d), such Manager shall have the rights and
duties given to the Company by paragraph (b) above (except that if the Company
or the Selling Shareholders shall have assumed the defense thereof such Manager
shall not be required to do so, but may employ separate counsel therein and
participate in the defense thereof, but the fees and expenses of such counsel
shall be at such Manager's expense), and the Company, its directors, any such
officer, any such controlling person and the Selling Shareholders shall have the
rights and duties given to the Managers by paragraph (b) above.
(e) If the indemnification provided for in this Section 9 is unavailable
to an indemnified party under paragraphs (a), (c), or (d) hereof in respect of
any losses, claims, damages, liabilities or expenses referred to therein, then
an 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 or expenses (i) in such proportion
as is appropriate to reflect the relative benefits received by the Company and
the Selling Shareholders on the one hand and the Managers 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 Selling Shareholders on the one
hand and the Managers on the other hand in connection with the statements or
omissions that resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Selling Shareholders on the one hand
and the Managers on the other hand shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses) received
by the Company and the Selling Shareholders bear to the total underwriting
discounts and commissions received by the Managers, in each case as set forth in
the table on the cover page of the International Prospectus; provided that, in
the event that the Managers shall have purchased any Additional Shares
hereunder, any determination of the relative
24
benefits received by the Company, the Selling Shareholders or the Managers from
the offering of the Shares shall include the net proceeds (before deducting
expenses) received by the Company, and the underwriting discounts and
commissions received by the Managers, from the sale of such Additional Shares,
in each case computed on the basis of the respective amounts set forth in the
notes to the table on the cover page of the International Prospectus. The
relative fault of the Company and the Selling Shareholders on the one hand and
the Managers on the other hand shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or the Selling Shareholders on the one hand or by the
Managers on the other hand and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission.
(f) The Company, the Selling Shareholders and the Managers agree that it
would not be just and equitable if contribution pursuant to this Section 9 were
determined by a pro rata allocation (even if the Managers 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 paragraph (e) above. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities and expenses referred to in paragraph (e) above
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 any claim or defending any such action, suit or
proceeding. Notwithstanding the provisions of this Section 9, no Managers shall
be required to contribute any amount in excess of the amount by which the total
price of the Shares underwritten by it and distributed to the public exceeds the
amount of any damages which such Managers has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. Notwithstanding the provisions of this Section 9, no Selling
Shareholder shall be required to contribute any amount in excess of the total
net proceeds of the Shares sold by such Selling Shareholder. 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 Managers' obligations to contribute pursuant
to this Section 9 are several in proportion to the respective numbers of Firm
Shares set forth opposite their names in Schedule II hereto (or such numbers of
Firm Shares increased as set forth in Section 12 hereof) and not joint.
(g) No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened action,
suit or 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
party, unless such settlement includes an unconditional release of
25
such indemnified party from all liability on claims that are the subject matter
of such action, suit or proceeding.
(h) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section 9 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 9 and the
representations and warranties of the Company and the Selling Shareholders set
forth in this Agreement shall remain operative and in full force and effect,
regardless of (i) any investigation made by or on behalf of any Managers or any
person controlling any Manager, the Company, its directors or officers or the
Selling Shareholders, any director, officer or partner of a Selling Shareholder
or any person controlling the Company or any Selling Shareholder, (ii)
acceptance of any Shares and payment therefor hereunder, and (iii) any
termination of this Agreement. A successor to any Manager or any person
controlling any Manager, or to the Company, its directors or officers, or to a
Selling Shareholder, any director, officer or partner of a Selling Shareholder,
or any person controlling the Company or any Selling Shareholder, shall be
entitled to the benefits of the indemnity, contribution and reimbursement
agreements contained in this Section 9.
10. Conditions of Managers' Obligations. The several obligations of the
Managers to purchase the Firm Shares hereunder are subject to the following
conditions:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or a post-effective amendment thereto
to be declared effective before the offering of the Shares may commence, the
Registration Statement or such post-effective amendment shall have become
effective not later than 5:30 P.M. New York City time, on the date hereof, or at
such later date and time as shall be consented to in writing by you, and all
filings, if any, required by Rules 424 and 430A under the Act shall have been
timely made; no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceeding for that purpose shall have
been instituted or, to the knowledge of the Company or any Manager, threatened
by the Commission, and any request of the Commission for additional information
(to be included in the Registration Statement or the Prospectuses or otherwise)
shall have been complied with to your reasonable satisfaction.
(b) Subsequent to the effective date of this Agreement, there shall
not have occurred (i) any change, or any development involving a prospective
change, in or affecting the condition (financial or other), business,
properties, net worth or results of operations of the Company or the
Subsidiaries not contemplated by the Prospectuses, which in your opinion, as
Lead Managers of the
26
several Managers, would materially, adversely affect the market for the Shares,
or (ii) any event or development relating to or involving the Company or any
officer or director of the Company or any Selling Shareholder which makes any
statement made in the Prospectuses untrue or which, in the opinion of the
Company and its counsel or the Managers and their counsel, requires the making
of any addition to or change in the Prospectuses in order to state a material
fact required by the Act or any other law to be stated therein or necessary in
order to make the statements therein not misleading, if amending or
supplementing the Prospectuses to reflect such event or development would, in
your opinion, as Lead Managers for the several Managers, materially adversely
affect the market for the Shares.
(c) You shall have received on the Closing Date an opinion of Cozen and
X'Xxxxxx, counsel for the Company and the Selling Shareholders, dated the
Closing Date and addressed to you, as Lead Managers for the several Managers, to
the effect that:
(i) The Company is a corporation duly incorporated and validly subsisting
under the laws of the Commonwealth of Pennsylvania with full corporate power and
authority to own, lease and operate its properties and to conduct its business
as described in the Registration Statement and the Prospectuses; [and is duly
registered and qualified to conduct its business and is in good standing in each
jurisdiction or place where the nature or the conduct of the business transacted
or property owned or leased by it makes such registration or qualification
necessary, except where the failure so to register or qualify or be in good
standing would not have a Material Adverse Effect];
(ii) Each of the Subsidiaries is either (A) a corporation duly organized
and validly existing in good standing under the laws of the jurisdiction of its
organization, or (B) a limited partnership duly organized under the laws of the
Commonwealth of Pennsylvania; [with full corporate power and authority to own,
lease, and operate its properties and to conduct its business as described in
the Registration Statement and the Prospectuses (and any amendment or supplement
thereto), and all the outstanding shares of capital stock of each of the
Subsidiaries have been duly authorized and validly issued, are fully paid and
nonassessable, and are owned by the Company directly, free and clear of any
perfected security interest, or, to the best knowledge of such counsel after
reasonable inquiry, any other security interest, lien, adverse claim, equity or
other encumbrance];
(iii) The authorized and outstanding capital stock of the Company is as
set forth under the caption "Capitalization" in the Prospectuses; and the
authorized capital stock of the Company conforms in all material respects as to
legal matters to the description thereof contained in the Prospectuses under the
caption "Description of Capital Stock";
27
(iv) All the shares of capital stock of the Company outstanding prior to
the issuance of the Shares to be issued and sold by the Company pursuant to the
Underwriting Agreements have been duly authorized and validly issued, are fully
paid and nonassessable;
(v) The Underwritten Shares to be issued and sold to the U.S. Underwriters
and Managers by the Company under the U.S. Underwriting Agreement and the
International Underwriting Agreement have been duly authorized and, when issued
and delivered to the U.S. Underwriters and Managers against payment therefor in
accordance with the terms of the U.S. Underwriting Agreement and the
International Underwriting Agreement, will be validly issued, fully paid and
nonassessable and free of any (A) preemptive rights or (B) to the best knowledge
of such counsel after reasonable inquiry, similar rights that entitle or will
entitle any person to acquire any Shares upon the issuance thereof by the
Company;
(vi) The form of certificates for the Shares conforms to the requirements
of the Pennsylvania Business Law of 1988, as amended;
(vii) The Registration Statement and all post-effective amendments, if
any, have become effective under the Act and, to the knowledge of such counsel,
no stop order suspending the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose are pending before or
contemplated by the Commission; and any required filing of the Prospectuses
pursuant to Rule 424(b) has been made in accordance with Rule 424(b);
(viii) The Company has the requisite corporate power and authority to
enter into this Agreement and the U.S. Underwriting Agreement and to issue, sell
and deliver the Underwritten Shares to be sold by it to the U.S. Underwriters
and Managers as provided herein and therein, and each of this Agreement and the
U.S. Underwriting Agreement have been duly authorized, executed and delivered by
the Company and is a legal, valid and binding agreement of the Company;
(ix) Neither the Company nor any of the Subsidiaries is (A) in violation
of its respective certificate of incorporation or bylaws or other organizational
documents, or (B) to the knowledge of such counsel in default in the performance
of any material obligation, agreement or condition contained in any bond,
debenture, note or other evidence of indebtedness, except as may be disclosed in
the Prospectuses or where any such default or defaults in the aggregate would
not, singularly or in the aggregate, have a Material Adverse Effect;
(x) Neither the offer, issuance, sale or delivery of the Underwritten
Shares, nor the execution, delivery or performance of this Agreement or the U.S.
Underwriting Agreement or compliance by
28
the Company with all provisions of this Agreement and the U.S. Underwriting
Agreement, nor consummation by the Company of the transactions contemplated
hereby or by the U.S. Underwriting Agreement conflicts or will conflict with or
constitutes or will constitute a breach of, or a default under, the certificate
of incorporation or bylaws, or other organizational document, of the Company or
any of the Subsidiaries or any material agreement, indenture, lease or other
instrument known to such counsel to which the Company or any of the Subsidiaries
is a party or by which any of them or any of their respective properties is
bound that is made an exhibit to the Registration Statement, or except as
disclosed in the Registration Statement, will result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets of the
Company or any of the Subsidiaries under any such agreement, indenture, lease or
other instrument, nor, to such counsel's knowledge, will any such action result
in any violation of any existing law, regulation, ruling (assuming compliance
with all applicable state securities and Blue Sky laws), or any ruling,
judgment, injunction, order or decree of any court or governmental entity or
instrumentality known to such counsel, and applicable to the Company, the
Subsidiaries or any of their respective properties;
(xi) No consent, approval, authorization or other order of, or
registration or filing with, any court, regulatory body, administrative agency
or other governmental body, agency, or official is required on the part of the
Company (except as have been obtained under the Act or such as may be required
under the securities laws of the jurisdictions governing the purchase and
distribution of the Shares) for the valid issuance and sale of the Shares to the
Managers as contemplated by this Agreement;
(xii) The Registration Statement and the Prospectuses and any supplements
or amendments thereto (except for the financial statements, schedules and notes
thereto 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 requirements of the Act;
(xiii) To the knowledge of such counsel, (A) other than as described or
contemplated in the Prospectuses, there are no legal or governmental proceedings
pending or threatened against the Company or any of the Subsidiaries or to which
the Company, the Subsidiaries or any of their respective properties is subject,
which are required to be described in the Registration Statement or Prospectuses
(or any amendment or supplement thereto) and (B) there are no agreements,
contracts, indentures, leases or other instruments, relating to the Company or
any of the Subsidiaries of a character that are required to be described in the
Registration Statement or the Prospectuses (or any amendment or supplement
thereto) or to be filed as an exhibit to the Registration Statement that are not
described or filed as required, as the case may be;
29
(xiv) To the knowledge of such counsel, the U.S. Underwriting Agreement,
the International Underwriting Agreement and the Custody Agreement have each
been duly authorized, executed and delivered by or on behalf of each of the
Selling Shareholders [and are valid and binding agreements of each Selling
Shareholder enforceable against each Selling Shareholder in accordance with
their respective terms except that (i) enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally, (ii) the remedy of
specific performance and other forms of equitable relief may be subject to
certain equitable defenses and to the discretion of the court before which the
proceedings may be brought and (iii) rights to indemnity and contribution
thereunder may be limited by Federal or state securities laws or the public
policy underlying such laws];
[(xv) To the best knowledge of such counsel after reasonable inquiry and
except as set forth in the Prospectuses, neither the Company nor any of the
Subsidiaries is in violation of any Laws or of any ruling, judgment, injunction,
order or decree of any court or governmental agency or body having jurisdiction
over the Company or any of the Subsidiaries which violation or violations would
not, singularly or in the aggregate, have a Material Adverse Effect;]
[(xvi) The Company and each of the Subsidiaries has all necessary orders,
consents, approvals, permits, licenses, franchises and authorizations of and
from all regulatory authorities to conduct their respective businesses as
described in the Registration Statement and Prospectuses, except, in any case,
where the failure to so possess would not, singularly or in the aggregate, have
a Material Adverse Effect, and to the best of such counsel's knowledge after due
inquiry, neither the Company nor the Subsidiaries has received any actual
notification from any regulatory authority to the effect that any additional
approval is required to be obtained by the Company or the Subsidiaries;]
(xvii) The statements in the Registration Statement and Prospectuses,
insofar as they are descriptions of contracts, agreements or other legal
documents or refer to statements of law or legal conclusions, are accurate in
all material respects and present fairly the information required to be shown;
(xviii) Except as described in the Prospectuses, such counsel does not
know of any outstanding option, warrant or other right calling for the issuance
of, and such counsel does not know of any commitment, plan or arrangement to
issue, any share of capital stock of the Company or any security convertible
into or exchangeable or exercisable for capital stock of the Company; and such
counsel does not know of any holder of any security of the Company or any other
person who has the right, contractual or otherwise, to cause the Company to sell
or otherwise issue to them, or permit them to underwrite the sale of, any of the
Shares or the
30
right to have any Common Stock or other securities of the Company included in
the Registration Statement or the right, as a result of the filing of the
Registration Statement, to require registration under the Act of Common Stock or
other securities of the Company;
(xix) The Company is not now and upon the sale of the Shares to be issued
and sold in accordance herewith and upon application of the net proceeds from
such sale as described in the Prospectuses under the caption "Use of Proceeds"
will not be an "investment company" within the meaning of the 1940 Act;
[(xx) The Company and the Subsidiaries own or possess all patents,
trademarks, trademark registrations, service marks, service xxxx registrations,
trade names, copyrights, licenses, inventions, trade secrets and rights
described in the Prospectuses as being owned by them or any of them or, to the
best knowledge of such counsel after reasonable inquiry, necessary for the
conduct of their respective businesses, except where the failure to so own or
possess would not, singularly or in the aggregate, have a Material Adverse
Effect, and such counsel is not aware of any claim to the contrary or any
challenge by any other person to the rights of the Company and the Subsidiaries
with respect to the foregoing;]
(xxi) Each Selling Shareholder has full legal right, power and
authorization, and any approval required by law (except such as may be required
under state or foreign securities of Blue Sky laws), to sell, assign, transfer
and deliver good and valid title to the Shares which such Selling Shareholder
has agreed to sell pursuant to this Agreement and the U.S. Underwriting
Agreement;
(xxii) The execution and delivery of this Agreement and the sale of the
Shares by each Selling Shareholder to the Underwriters, and compliance by such
Selling Shareholder with the terms of this Agreement, including the delivery to
the Underwriters of certificates evidencing such shares and the execution and
delivery to the Underwriters of a stock power in blank, have been duly
authorized by all necessary action on the part of such Selling Shareholder, and
to the knowledge of such counsel do not, and will not, conflict with, or result
in a breach of any of the terms and provisions of, or constitute a default under
(I) any statute, rule or regulation (assuming compliance with all applicable
state securities and Blue Sky laws) relating to such Selling Shareholder or its
legal or regulatory status in each case, that in the experience of such counsel
are normally applicable to transactions of the type provided for in this
Agreement, (II) any material judgment, order, rule, injunction or regulation of
any court or governmental agency or body, domestic or foreign, known to such
counsel as having jurisdiction over such Selling Shareholder or any of its
respective properties or (III) any material contract, agreement or other
instrument known to such counsel to which such Selling Shareholder is a party or
by which it or any of its properties are subject;
31
(xxiii) Upon consummation of the sale of the Shares pursuant to this
Agreement, assuming the Underwriters purchased the Shares for value, in good
faith and without notice of adverse claim, the Underwriters will have acquired
all rights of the Selling Shareholder in the Shares free and clear of any
security interest, mortgage, lien, pledge, encumbrance, claim or equity, [and
the owner of the Shares, if other than such Selling Shareholder, is precluded
from asserting against the Underwriters the ineffectiveness of any unauthorized
endorsement].
In addition, such counsel shall state that although counsel has not
undertaken, [except as otherwise indicated in their opinion], to determine
independently, and does not assume any responsibility for, the accuracy,
completeness or fairness of the statements in the Registration Statement,
(except to the extent set forth in paragraphs (iii) and (xvii) above)] such
counsel has participated in the preparation of the Registration Statement and
the Prospectuses, including general review and discussion of the contents
thereof, and nothing has come to the attention of such counsel that would lead
them to believe that the Registration Statement at the time the Registration
Statement became effective, or the Prospectuses, as of their respective dates
and as of the Closing Date or the Option Closing Date, as the case may be,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated or necessary to make the statements therein, in the
case of the Prospectuses, in the light of the circumstances under which they
were made, not misleading or that any amendment or supplement to the
Prospectuses, as of its respective date, and as of the Closing Date or the
Option Closing Date, as the case may be, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated in the
Prospectuses or necessary in order to make the statements therein, in the case
of the Prospectuses, in the light of the circumstances under which they were
made, not misleading (it being understood that such counsel need express no
statement with respect to the financial statements, financial schedules, pro
forma financial statements and the notes thereto and other financial and
statistical data included in the Registration Statement or the Prospectuses).
In rendering their opinion as aforesaid, counsel may, as to factual
matters, rely, to the extent such counsel deems proper, upon written
certificates or statements of officers of the Company and the Selling
Shareholders and, as to matters of law, may rely upon an opinion or opinions,
each dated the Closing Date, of other counsel retained by them or the Company as
to laws of any jurisdiction other than the United States or the Commonwealth of
Pennsylvania. The foregoing opinion may be limited to the federal laws of the
United States of America and the Commonwealth of Pennsylvania, and counsel
rendering the foregoing opinion may rely as to questions of fact upon the
representations of the Selling Shareholders as set forth in this Agreement and
in the Custody Agreement.
32
(d) You shall have received on the Closing Date an opinion of Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the Managers, dated the Closing
Date and addressed to you as Lead Managers for the several Managers, with
respect to the matters referred to in clauses (v), (other than subclause (B)
thereof), (vii), (viii), (x) and the paragraph immediately following clause
(xxiii) of the foregoing paragraph (c) and such other related matters as you may
request.
(e) You shall have received letters addressed to you, as Lead Managers for
the several Managers, and dated the date hereof and the Closing Date from Xxxxxx
Xxxxxxxx LLP and Deloitte & Touche LLP, independent certified public
accountants, substantially in the forms heretofore approved by you.
(f) (i) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been taken or, to the knowledge of the Company, shall be contemplated by the
Commission at or prior to the Closing Date; (ii) there shall not have been any
material change in the capital stock of the Company nor any material increase in
the short-term or long-term debt of the Company (other than in the ordinary
course of business) from that set forth or contemplated in the Registration
Statement or the Prospectuses (or any amendment or Supplement thereto); (iii)
there shall not have been, since the respective dates as of which information is
given in the Registration Statement and the Prospectuses (or any amendment or
supplement thereto), except as may otherwise be stated or contemplated in the
Registration Statement and Prospectuses (or any amendment or supplement
thereto), any material adverse change in the condition (financial or other),
business, prospects, properties, net worth or results of operations of the
Company and the Subsidiaries taken as a whole; (iv) the Company and the
Subsidiaries shall not have any liabilities or obligations, direct or contingent
(whether or not in the ordinary course of business), that are material to the
Company and the Subsidiaries, taken as a whole, other than those reflected in
the Registration Statement or the Prospectuses (or any amendment or supplement
thereto); and (v) all the representations and warranties of the Company
contained in this Agreement shall be true and correct [in all material respects]
on and as of the date hereof and on and as of the Closing Date as if made on and
as of the Closing Date, and you shall have received a certificate, dated the
Closing Date and signed by the chief executive officer and the chief financial
officer of the Company (or such other officers as are acceptable to you), to the
effect set forth in this Section 10(f) and in Section 10(g) hereof.
(g) The Company shall not have failed at or prior to the Closing Date to
have performed or complied with any of its agreements herein contained and
required to be performed or complied with by it hereunder at or prior to the
Closing Date.
33
(h) All the representations and warranties of the Selling
Shareholders contained in this Agreement and in the U.S. Underwriting Agreement
shall be true and correct on and as of the date hereof and on and as of the
Closing Date as if made on and as of the Closing Date, and you shall have
received a certificate, dated the Closing Date and signed by or on behalf of
each of the Selling Shareholders to the effect set forth in this Section 10(h)
and in Section 10(i) hereof.
(i) The Selling Shareholders shall not have failed at or prior to the
Closing Date to have performed or complied in all material respects with any of
their agreements contained in this Agreement or in the U.S. Underwriting
Agreement and required to be performed or complied with by them at or prior to
the Closing Date.
(j) The Shares shall have been listed or approved for listing subject
to notice of issuance on the New York Stock Exchange.
(k) The closing under the U.S. Underwriting Agreement shall have
occurred on the Closing Date concurrently with the closing hereunder.
(l) The Sellers shall have furnished or caused to be furnished to you
such further certificates and documents as you shall have reasonably requested.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are reasonably satisfactory
in form and substance to you and your counsel.
Any certificate or document signed by any officer of the Company or any
Attorney-in-Fact or any Selling Shareholder and delivered to you, as Lead
Managers for the several Managers, or to counsel for the Managers, shall be
deemed a representation and warranty by the Company, the Selling Shareholders or
the particular Selling Shareholder, as the case may be, to each Manager as to
the statements made therein.
The several obligations of the Managers to purchase Additional Shares
hereunder are subject to the satisfaction on and as of any Option Closing Date
of the conditions set forth in this Section 10, except that, if any Option
Closing Date is other than the Closing Date, the certificates, opinions and
letters referred to in this Section 10 shall be dated the Option Closing Date in
question and the opinions or letters called for by paragraphs (c), (d), (e) and
(f) shall be revised to reflect the sale of Additional Shares.
11. Expenses. The Company agrees to pay the following costs and expenses
and all other costs and expenses incident to the performance by the Company of
its obligations hereunder: (i) the printing (or reproduction) and filing with
the Commission and
34
delivery charges and charges for counting and packaging of such copies of the
Registration Statement, each International Prepricing Prospectus, the
International Prospectus and all amendments or supplements to any of them, as
may be reasonably requested for use in connection with the offering and sale of
the Shares; (ii) the preparation, printing, authentication, issuance and
delivery of certificates for the Shares, including any stamp taxes in connection
with the original issuance and sale of the Shares by the Company; (iii) the
printing (or reproduction) and delivery of this Agreement, the U.S. Underwriting
Agreement, the Supplemental Agreement Among U.S. Underwriters, the Agreement
Among Managers, the Agreement Between U.S. Underwriters and Managers, the
International Selling Agreement, the Managers' Questionnaire, the preliminary
and supplemental Blue Sky Memoranda and all other agreements or documents
printed (or reproduced) and delivered in connection with the original issuance
and sale of the Shares; (iv) the registration of the Common Stock under the
Exchange Act and the listing of the Shares on the New York Stock Exchange; (v)
the registration or qualification of the Shares for offer and sale under the
securities or Blue Sky laws of the several jurisdictions as provided in Section
5(g) hereof (including the reasonable fees, expenses and disbursements of
counsel for the Underwriters relating to the preparation, printing or
reproduction, and delivery of the preliminary and supplemental Blue Sky
Memoranda and such registration and qualification); (vi) the filing fees in
connection with any filings required to be made with the National Association of
Securities Dealers, Inc.; (vii) the transportation and other expenses incurred
by or on behalf of representatives of the Company in connection with
presentations to prospective purchasers of the Shares; and (viii) the fees and
expenses of the Company's accountants and the fees and expenses of counsel
(including local and special counsel) for the Company. Each Selling Shareholder
agrees to pay for any transfer taxes on the sale by such Selling Shareholder of
such Selling Shareholder's Shares to the U.S. Underwriters.
12. Effective Date of Agreement. This Agreement shall become effective:
(i) upon the execution and delivery hereof by the parties hereto; or (ii) if, at
the time this Agreement is executed and delivered, it is necessary for the
registration statement or a post-effective amendment thereto to be declared
effective before the offering of the Shares may commence, when notification of
the effectiveness of the registration statement or such post-effective amendment
has been released by the Commission. Until such time as this Agreement shall
have become effective, it may be terminated by the Company, by notifying you, or
by you, as Lead Managers for the several Managers, by notifying the Company and
the Selling Shareholders.
If any one or more of the Managers shall fail or refuse to purchase
Shares which it or they are obligated to purchase hereunder on the Closing Date,
and the aggregate number of Shares which such defaulting Manager or Managers are
obligated but fail or
35
refuse to purchase is not more than one-tenth of the aggregate number of Shares
which the Managers are obligated to purchase on the Closing Date, each non-
defaulting Manager shall be obligated, severally, in the proportion which the
number of Firm Shares set forth opposite its name in Schedule II hereto bears to
the aggregate number of Firm Shares set forth opposite the names of all non-
defaulting Managers or in such other proportion as you may specify in accordance
with Section 20 of the Master Agreement Among Underwriters of Xxxxx Xxxxxx Inc.,
to purchase the Shares which such defaulting Manager or Managers are obligated,
but fail or refuse, to purchase. If any one or more of the Managers shall fail
or refuse to purchase Shares which it or they are obligated to purchase on the
Closing Date and the aggregate number of Shares with respect to which such
default occurs is more than one-tenth of the aggregate number of Shares which
the Managers are obligated to purchase on the Closing Date and arrangements
satisfactory to you and the Company for the purchase of such Shares by one or
more non-defaulting Managers or other party or parties approved by you and the
Company are not made within 36 hours after such default, this Agreement will
terminate without liability on the part of any non-defaulting Manager or 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. Any action taken under
this paragraph shall not relieve any defaulting Manager from liability in
respect of any such default of any such Manager under this Agreement. The term
"Manager" as used in this Agreement includes, for all purposes of this
Agreement, any party not listed in Schedule II hereto which, with your approval
and the approval of the Company, purchases Shares which a defaulting Manager is
obligated, but fails or refuses, to purchase.
Any notice under this Section 12 may be given by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
13. Termination of Agreement. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of any
Manager to the Company or any Selling Shareholder, by notice to the Company, if
prior to the Closing Date or any Option Closing Date (if different from the
Closing Date and then only as to the Additional Shares), as the case may be, (i)
trading in securities generally on the New York Stock Exchange, American Stock
Exchange or the Nasdaq National Market shall have been suspended or materially
limited, (ii) a general moratorium on commercial banking activities in New York
or Pennsylvania shall have been declared by either federal or state authorities,
or (iii) there shall have occurred any outbreak or escalation of hostilities or
other international or domestic calamity, crisis or change in political,
financial or economic conditions, the effect of which on the financial markets
of the United States is such as to make it,
36
in your judgment, impracticable or inadvisable to commence or continue the
offering of the Shares at the offering price to the public set forth on the
cover page of the International Prospectus or to enforce contracts for the
resale of the Shares by the Managers.
Notice of such termination may be given by telegram, telecopy or telephone
and shall be subsequently confirmed by letter.
14. Information Furnished by the Managers. The statements set forth in
the last paragraph on the cover page, the stabilization legend on the inside
front cover page, and the statements in the [ ] paragraphs under the caption
"Underwriting" in any International Prepricing Prospectus and in the
International Prospectus, constitute the only information furnished by or on
behalf of the Managers through you as such information is referred to in
Sections 7(b) and 9 hereof.
15. Miscellaneous. Except as otherwise provided in Sections 5, 12 and 13
hereof, notice given pursuant to any provision of this Agreement shall be in
writing and shall be delivered (i) if to the Company, or the Selling
Shareholders at the office of the Company at 000 Xxxx Xxxxxx, Xxxx xx Xxxxxxx,
XX 00000 Attention: _______________ or (iii) if to you, as Lead Managers for
the several Managers, care of Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: Manager, Investment Banking Division.
This Agreement has been and is made solely for the benefit of the several
Managers, the Company, its directors and officers, and the other controlling
persons referred to in Section 9 hereof and the Selling Shareholders and their
respective successors and assigns, to the extent provided herein, and no other
person shall acquire or have any right under or by virtue of this Agreement.
Neither the term "successor" nor the term "successors and assigns" as used in
this Agreement shall include a purchaser from any Manager of any of the Shares
in his status as such purchaser.
16. Applicable Law; Counterparts. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
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Please confirm that the foregoing correctly sets forth the agreement among
the Company, the Selling Shareholders and the several Managers.
Very truly yours,
XXXXXX XXXXX CORP.
By ........................
President and Chief
Executive Officer
Each of the Selling Shareholders
named in Schedule I hereto
By ............................
Attorney-in-Fact
By ...........................
Attorney-in-Fact
Confirmed as of the date first
above mentioned on behalf of
themselves and the other several
Managers named in Schedule II
hereto.
XXXXX XXXXXX INC.
XXXXXXX XXXXX INTERNATIONAL
PAINEWEBBER INTERNATIONAL
As Lead Managers for the Several Managers
By XXXXX XXXXXX INC.
By ...................................
Managing Director
38
SCHEDULE I
XXXXXX XXXXX CORP.
Part A - Firm Shares
--------------------
Number of
Selling Shareholders Firm Shares
-------------------- -----------
--------------
Total........
--------------
39
SCHEDULE II
XXXXXX XXXXX CORP.
Number of Number of
Underwriter Shares Underwriter Shares
----------- ------ ----------- ------
Xxxxx Xxxxxx Inc. .......
Xxxxxxx Xxxxx International
PaineWebber International .
----------
Total.... ==========
40
