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Exhibit 1.1
8,000,000 Shares
TWINLAB CORPORATION
Common Stock
UNDERWRITING AGREEMENT
April , 1998
BEAR, XXXXXXX & CO. INC.
XXXXXXXXX, LUFKIN & XXXXXXXX SECURITIES CORPORATION
XXXXX, XXXXXXXX & XXXX, INC.
XXXXXX BROTHERS INC.
XXXXX XXXXXX INC.
As representatives of the several U.S. underwriters
named in Schedule I hereto
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
BEAR, XXXXXXX INTERNATIONAL LIMITED
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES INTERNATIONAL
XXXXX, XXXXXXXX & XXXX, INC.
XXXXXX BROTHERS INTERNATIONAL
XXXXX XXXXXX INC.
As representatives of the several international
managers named in Schedule II hereto
c/o Bear, Xxxxxxx International Limited
Dear Sirs:
TWINLAB CORPORATION, a Delaware corporation (the "COMPANY"),
proposes to issue and sell to the several Underwriters (as defined below), and
certain stockholder(s) of the Company named in Schedule III hereto (the "SELLING
STOCKHOLDERS") severally propose to sell to the several Underwriters, an
aggregate of 8,000,000 shares of Common Stock, par value $1.00 per share, of the
Company (the "FIRM SHARES"), of which 8,000,000 shares are to be issued and sold
by the Company and 8,000,000 shares are to be sold by the Selling Stockholders,
each Selling Stockholder selling the amount set
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forth opposite such Selling Stockholder's name in Schedule III hereto. It is
understood that, subject to the conditions hereinafter stated, 6,400,000 Firm
Shares (the "U.S. FIRM SHARES") will be sold to the several U.S. Underwriters
named in Schedule I hereto (the "U.S. UNDERWRITERS") in connection with the
offering and sale of such U.S. Firm Shares in the United States and Canada to
United States and Canadian Persons (as such terms are defined in the Agreement
Between U.S. Underwriters and International Managers of even date herewith), and
1,600,000 Firm Shares (the "INTERNATIONAL SHARES") will be sold to the several
International Managers named in Schedule II hereto (the "INTERNATIONAL
MANAGERS") in connection with the offering and sale of such International Shares
outside the United States and Canada to persons other than United States and
Canadian Persons. Bear, Xxxxxxx & Co. Inc., Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation, Xxxxx, Xxxxxxxx & Xxxx, Inc., Xxxxxx Brothers Inc. and
Xxxxx Xxxxxx Inc. shall act as representatives (the "U.S. REPRESENTATIVES") of
the several U.S. Underwriters, and Bear, Xxxxxxx International Limited,
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities International, Xxxxx, Xxxxxxxx & Xxxx,
Inc., Xxxxxx Brothers International and Xxxxx Xxxxxx Inc. shall act as
representatives of the several International Managers. The U.S. Underwriters and
the International Managers are hereinafter collectively referred to as the
"UNDERWRITERS".
The Company also proposes to issue and sell and the Selling
Stockholders also propose to sell, severally and not jointly, to the several
U.S. Underwriters not more than an additional 1,200,000 shares of its Common
Stock, par value $1.00 per share (the "ADDITIONAL SHARES"), if requested by the
U.S. Underwriters as provided in Section 2 hereof. The Firm Shares and the
Additional Shares are hereinafter referred to collectively as the "SHARES". The
shares of common stock of the Company to be outstanding after giving effect to
the sales contemplated hereby are hereinafter referred to as the "COMMON STOCK".
The Company and the Selling Stockholders are hereinafter sometimes referred to
collectively as the "SELLERS."
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 called the "ACT"), a registration statement on Form S-3 (File No.
333-48091), including a prospectus, relating to the Shares. The registration
statement contains two prospectuses to be used in connection with the offering
and sale of the Shares: the U.S. prospectus, to be used in connection with the
offering and sale of Shares in the United States and Canada to United States and
Canadian Persons, and the international prospectus, to be used in connection
with the offering and sale of Shares outside the United States and Canada to
persons other than United States and Canadian Persons (including, in the case of
all references to the Registration Statement or the Prospectus, documents
incorporated therein by reference). The international prospectus is identical to
the U.S. prospectus except for the outside front and back cover pages. The
registration statement, as amended at the time it became effective, including
the information (if any) deemed to be part of the registration statement at the
time of
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effectiveness pursuant to Rule 430A under the Act, is hereinafter referred to as
the "REGISTRATION STATEMENT"; and the U.S. prospectus and the international
prospectus in the respective forms first used to confirm sales of Shares are
hereinafter collectively referred to as the "PROSPECTUS". If the Company has
filed or is required pursuant to the terms hereof to file a registration
statement pursuant to Rule 462(b) under the Act registering additional shares of
Common Stock (a "RULE 462(B) REGISTRATION STATEMENT"), then, unless otherwise
specified, any reference herein to the term "Registration Statement" shall be
deemed to include such Rule 462(b) Registration Statement. The terms
"SUPPLEMENT" and "AMENDMENT" or "AMEND" as used in this Agreement with respect
to the Registration Statement or the Prospectus shall include all documents
subsequently filed by the Company with the Commission pursuant to the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "EXCHANGE ACT") that are deemed to be
incorporated by reference in the Prospectus.
2. Agreements to Sell and Purchase. On the basis of the
representations and warranties contained in this Agreement, and subject to its
terms and conditions, (i) the Company agrees to issue and sell 4,000,000 Firm
Shares, (ii) each Selling Stock holder agrees, severally and not jointly, to
sell the number of Firm Shares set forth opposite such Selling Stockholder's
name under the caption "Number of Firm Shares Being Sold" in Schedule III hereto
and (iii) each Underwriter agrees, severally and not jointly, to purchase from
each Seller at a price per Share of $______ (the "PURCHASE PRICE") the number of
Firm Shares (subject to such adjustments to eliminate fractional shares as you
may determine) that bears the same proportion to the total number of Firm Shares
to be sold by such Seller as the number of Firm Shares set forth opposite the
name of such Underwriter in Schedules I and II hereto bears to the total number
of Firm Shares.
On the basis of the representations and warranties contained
in this Agreement, and subject to its terms and conditions, the Company agrees
to issue and sell and the Selling Stockholders agree to sell, severally and not
jointly, the Additional Shares and the U.S. Underwriters shall have the right to
purchase, severally and not jointly, up to 1,200,000 Additional Shares from the
Company and the Selling Stockholders at the Purchase Price. Additional Shares
may be purchased solely for the purpose of covering over-allotments made in
connection with the offering of the Firm Shares. The U.S. Underwriters may
exercise their right to purchase Additional Shares in whole or in part from time
to time by giving written notice thereof to the Company and the Attorneys (as
hereinafter defined) within 30 days after the date of this Agreement. The U.S.
Representatives shall give any such notice on behalf of the U.S. Underwriters
and such notice shall specify the aggregate number of Additional Shares to be
purchased pursuant to such exercise and the date for payment and delivery
thereof, which date shall be a business day (i) no earlier than two business
days after such notice has been given (and, in any event, no earlier than the
Closing Date (as hereinafter defined)) and (ii) no later than ten business days
after such notice has been given. If any Additional Shares are to be purchased,
each U.S. Underwriter, severally and not jointly, agrees to purchase from the
Company and the
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Selling Stockholders the number of Additional Shares (subject to such
adjustments to eliminate fractional shares as the U.S. Representatives may
determine) which bears the same proportion to the total number of Additional
Shares to be purchased from the Company and the Selling Stockholders as the
number of U.S. Firm Shares set forth opposite the name of such U.S. Underwriter
in Schedule I bears to the total number of U.S. Firm Shares. If any Additional
Shares are to be purchased, the Company and each Selling Stockholder agree,
severally and not jointly, to sell the U.S. Underwriters the respective number
of Additional Shares specified in such notice by a fraction the numerator of
which is 228,749 in the case of the Company and, in the case of the Selling
Stockholders, the number of Additional Shares set forth opposite each such
Selling Stockholder's name under the caption "Number of Additional Shares" in
Schedule III hereto and the denominator of which is the total number of
Additional Shares.
The Company and the Selling Stockholders hereby agree and the
Company shall, concurrently with the execution of this Agreement, deliver an
agreement, dated as of the date of this Agreement, executed by it, each of its
directors and officers and each stockholder listed on Annex I hereto, pursuant
to which it and each such person agrees, not to, directly or indirectly, offer,
sell, contract to sell, grant any option to purchase or sell, or otherwise
dispose of any Common Stock of the Company or any securities convertible into or
exercisable or exchangeable for, or warrants, options or rights to purchase or
acquire, Common Stock or in any other manner transfer all or a portion of the
economic consequences associated with the ownership of any Common Stock
(collectively "Issue"), except to the Underwriters pursuant to this Agreement,
for a period of 90 days after the date of the Prospectus without the prior
written consent of Bear, Xxxxxxx & Co. Inc. Notwithstanding the foregoing,
during such period the Company may (a) Issue shares of Common Stock pursuant to
the Company's stock option plan substantially as in effect as of the Closing
Date and (b) Issue shares of Common Stock in connection with employee benefit
arrangements of the Company, which issuances, as set forth in clauses (a) and
(b) above, shall not exceed 2.0% of the outstanding Common Stock of the Company.
The Company also agrees not to file any registration statement with respect to
any shares of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock for a period of 90 days after the date of the
Prospectus without the prior written consent of Bear, Xxxxxxx & Co. Inc. In
addition, each Selling Stockholder agrees that, for a period of 90 days after
the date of the Prospectus without the prior written consent of Bear, Xxxxxxx &
Co. Inc., it will not make any demand for, or exercise any right with respect
to, the registration of any shares of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock.
3. Terms of Public Offering. The Sellers are advised by you
that the Underwriters propose (i) to make a public offering of their respective
portions of the Shares as soon after the execution and delivery of this
Agreement as in your judgment is advisable and (ii) initially to offer the
Shares upon the terms set forth in the Prospectus. Each U.S. Underwriter hereby
makes to the Company the representations and agreements
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of such U.S. Underwriter contained in the fifth paragraph of Section 3 of the
Agreement Between U.S. Underwriters and International Managers of even date
herewith. Each International Manager hereby makes to the Company the
representations and agreements of such International Manager contained in the
seventh, eighth, ninth and tenth paragraphs of Section 3 of such Agreement.
4. Delivery and Payment. The Shares shall be represented by
definitive certificates and shall be issued in such authorized denominations and
registered in such names as Bear, Xxxxxxx & Co. Inc. shall request no later than
two business days prior to the Closing Date or the applicable Option Closing
Date (as defined below), as the case may be. The Shares shall be delivered by or
on behalf of the Sellers, with any transfer taxes thereon duly paid by the
respective Sellers, to Bear, Xxxxxxx & Co. Inc. through the facilities of The
Depository Trust Company ("DTC"), for the respective accounts of the several
Underwriters, against payment to the Sellers of the Purchase Price therefore by
wire transfer of Federal or other funds immediately available in New York City.
The certificates representing the Shares shall be made available for inspection
not later than 9:30 A.M., New York City time, on the business day prior to the
Closing Date or the applicable Option Closing Date, as the case may be, at the
office of DTC or its designated custodian (the "DESIGNATED OFFICE"). The time
and date of delivery and payment for the Firm Shares shall be 9:00 A.M., New
York City time, on April __, 1998 or such other time on the same or such other
date as Bear, Xxxxxxx & Co. Inc. and the Company shall agree in writing. The
time and date of delivery and payment for the Firm Shares are hereinafter
referred to as the "CLOSING DATE". The time and date of delivery and payment for
any Additional Shares to be purchased by the U.S. Underwriters shall be 9:00
A.M., New York City time, on the date specified in the applicable exercise
notice given by the U.S. Representatives pursuant to Section 2 or such other
time on the same or such other date as Bear, Xxxxxxx & Co. Inc. and the Company
shall agree in writing. The time and date of delivery and payment for any
Additional Shares are hereinafter referred to as an "OPTION CLOSING DATE".
The documents to be delivered on the Closing Date or any
Option Closing Date on behalf of the parties hereto pursuant to Section 9 of
this Agreement shall be delivered at the offices of Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000 and the Shares
shall be delivered at the Designated Office, all on the Closing Date or such
Option Closing Date, as the case may be.
5. Agreements of the Company. The Company agrees with you
that:
(a) It will, if the Registration Statement has not
heretofore become effective under the Act, and, if necessary or
required by law, file an amendment to the Registration Statement or, if
necessary pursuant to Rule 430A under the Act, a post-effective
amendment to the Registration Statement, in each case as soon as
practicable after the execution and delivery of this Agreement and will
use
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its reasonable best efforts to cause the Registration Statement or such
post-effective amendment to become effective at the earliest possible
time. If the Registration Statement has become effective and the
Company, omitting from the Prospectus certain information in reliance
upon Rule 430A of the Act, elects not to file a post-effective
amendment pursuant to Rule 430A of the Act, it will file the form of
Prospectus required by Rule 424(b) of the Act within the time period
specified by Rule 430A and Rule 424(b) of the Act. The Company will
otherwise comply fully and in a timely manner with the applicable
provisions of Rule 424 and Rule 430A under the Act.
(b) It will advise you promptly and, if requested by
you, confirm such advice in writing, (i) if and when the Prospectus is
sent for filing pursuant to Rule 424 under the Act (including any term
sheet within the meaning of Rule 434 under the Act), when the
Registration Statement has become effective, when any Rule 462
Registration Statement is filed and becomes effective, and when any
post-effective amendment to it becomes effective, (ii) of the receipt
of any comment that relates to the Registration Statement from the
Commission or any other regulatory authority or any request by the
Commission for amendments to the Registration Statement or amendments
or supplements to the Prospectus or for additional information, (iii)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement, or of the suspension of
qualification of the Shares for offering or sale in any jurisdiction,
or the initiation of any proceeding for such purposes by the Commission
or any state securities commission or regulatory authority, (iv) when
any amendment to the Registration Statement becomes effective, (v) if
the Company is required to file a Rule 462(b) Registration Statement
after the effectiveness of this Agreement, when the Rule 462(b)
Registration Statement has become effective and (vi) of the happening
of any event during the period referred to in Section 5(e) below which
makes any statement of a material fact made in the Registration
Statement or the Prospectus untrue or which requires any additions to
or changes in the Registration Statement or Prospectus in order to make
the statements therein not misleading or that makes any statement of a
material fact made in the Prospectus (as amended or supplemented from
time to time) untrue or which requires the making of any additions to
or changes in the Prospectus (as amended or supplemented from time to
time) in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. The Company
will use its reasonable best efforts to prevent the issuance of any
stop order or order suspending the qualification or exemption of the
Shares under any Federal or state securities or Blue Sky laws, and, if
at any time the Commission shall issue any stop order suspending the
effectiveness of the Registration Statement, or any state securities
commission or other regulatory authority shall issue an order
suspending the qualification or exemption of the Shares under any state
securities or Blue Sky laws, the Company
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will use its reasonable best efforts to obtain the withdrawal or
lifting of such order at the earliest possible time.
(c) It will furnish to each of the U.S.
Representatives, without charge, one signed copy of the Registration
Statement as first filed with the Commission and of each amendment to
it, including all exhibits and documents incorporated therein by
reference (plus one additional signed copy, including exhibits, to your
legal counsel), and it will furnish to each of the U.S. Representa-
tives, your legal counsel and each Underwriter designated by the U.S.
Representatives such number of conformed copies of the Registration
Statement as so filed and of each amendment to it, without exhibits but
including documents incorporated therein by reference, as the U.S.
Representatives may reasonably request.
(d) It will prepare the Prospectus, the form and
substance of which shall be reasonably satisfactory to you, and file
the Prospectus in such form with the Commission within the applicable
period specified in Rule 424(b) under the Act; during the period
specified in Section 5(e) below, it will not file any further amendment
to the Registration Statement and not make any amendment or supplement
to the Prospectus of which you shall not previously have been advised
or to which you shall reasonably object after being so advised; and,
during such period, it will prepare and file with the Commission,
promptly upon your reason able request, any amendment to the
Registration Statement or supplement to the Prospectus which may be
necessary or advisable in connection with the distribution of the
Shares by the Underwriters, and it will use its reasonable best efforts
to cause any such amendment to the Registration Statement to become
promptly effective.
(e) Prior to 10:00 A.M., New York City time, on the
first business day after the date of this Agreement and from time to
time thereafter for such period as in your reasonable judgment a
prospectus is required by law to be delivered in connection with sales
by an Underwriter or a dealer, it will furnish in New York City to each
Underwriter and any dealer, without charge, as many copies of the
Prospectus (and of any amendment or supplement to the Prospectus and
any documents incorporated therein by reference) as such Underwriter or
such dealer may reasonably request.
(f) If during the period specified in Section 5(e)
any event shall occur or condition shall exist as a result of which, in
the opinion of counsel for the Underwriters, it becomes necessary to
amend or supplement the Prospectus in order to make the statements
therein, in the light of the circumstances when the Prospectus is
delivered to a purchaser, not misleading, or if, in the opinion of
counsel for the Underwriters, it is necessary to amend or supplement
the Prospectus to comply with applicable law, it will promptly prepare
and file with the Com-
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mission an appropriate amendment or supplement to the Prospectus so
that the statements in the Prospectus, as so amended or supplemented,
will not, in the light of the circumstances when it is so delivered, be
misleading, or so that the Prospectus will comply with applicable law,
and to furnish to each Underwriter and to such dealers as the
Underwriters shall specify, without charge, such number of copies
thereof as such Underwriter or such dealers may reasonably request.
(g) Prior to any public offering of the Shares, it
will cooperate with you and counsel for the Underwriters in connection
with the registration or qualification of the Shares for offer and sale
by the several Underwriters and by dealers under the state securities
or Blue Sky laws of such jurisdictions as you may request, to continue
such registration or qualification in effect so long as required for
distribution of the Shares and it will file such consents to service of
process or other documents as may be necessary in order to effect such
registration or qualification; provided, however, that the Company
shall not be required in connection therewith to qualify as a foreign
corporation in any jurisdiction in which it is not now so qualified or
to take any action that would subject it to general consent to service
of process or taxation other than as to matters and transactions
relating to the Prospectus, the Registration Statement, any preliminary
prospectus or the offering or sale of the Shares, in any jurisdiction
in which it is not now so subject.
(h) It will mail and make generally available to its
stockholders as soon as reasonably practicable an earnings statement
covering the twelve-month period ending ____, 1999 that shall satisfy
the provisions of Section 11(a) of the Act, and it will advise you in
writing when such statement has been so made avail able.
(i) It will timely complete all required filings and
otherwise comply in all material respects in a timely manner with all
provisions of the Securities Exchange Act of 1934, as amended,
including the rules and regulations thereunder (collectively, the
"EXCHANGE ACT"), in connection with the registration of the Shares
thereunder.
(j) During the period of five years after the date of
this Agreement, it will promptly file all reports and any definitive
proxy or information statements required to be filed by the Company
with the Commission pursuant to the Exchange Act and will promptly mail
all such reports to the recordholders of its Common Stock to the extent
required by the Exchange Act.
(k) During the period referred to in paragraph (j),
it will furnish to you as soon as available copies of all reports or
other communications furnished to the record holders of Common Stock or
furnished to or filed with the Commission or any national securities
exchange on which any class of securities of the
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Company is listed and such other publicly available information
concerning the Company and its subsidiaries as you may reasonably
request.
(l) Whether or not the transactions contemplated in
this Agreement are consummated or this Agreement is terminated, it
will pay or cause to be paid all costs, expenses, fees and taxes
incident to (i) the preparation, printing (including word processing),
filing and distribution under the Act of the Registration Statement
(including, without limitation, financial statements and exhibits),
each preliminary prospectus and all amendments and supplements to any
of them prior to or during the period specified in paragraph 5(e), (ii)
the printing (including word processing), distribution and delivery of
the Prospectus and all amendments or supplements to it during the
period specified in paragraph 5(e), (iii) the printing, execution,
distribution and delivery of this Agreement, the Preliminary and
Supplemental Blue Sky Memoranda and all other agreements, memoranda,
correspondence and other documents printed, distributed and delivered
in connection with the offering of the Shares (including in each case
any disbursements of counsel for the Underwriters relating to such
printing and delivery), (iv) the registration or qualification of the
Shares for offer and sale under the securities or Blue Sky laws of the
several states referred to in paragraph 5(g) (including, without
limitation, in each case the fees and disbursements of counsel for the
Underwriters relating to such registration or qualification and any
memoranda relating thereto and any filing fees in connection
therewith), (v) the filing, registration and clearance of the
Underwriters' compensation with the National Association of Securities
Dealers, Inc. in connection with the offering of the Shares (including,
without limitation, any filing fees in connection therewith), (vi) the
quotation of the Shares on the Nasdaq National Market ("NASDAQ"), (vii)
furnishing such copies of the Registration Statement, the Prospectus
and all amendments and supplements thereto as may be requested for use
in connection with the offering or sale of the Shares by the
Underwriters or by dealers to whom Shares may be sold, and (viii) the
performance by the Company of its other obligations under this
Agreement, including (without limitation) the fees and expenses of the
Transfer Agent, the costs of its personnel and other internal costs,
the cost of printing and engraving the certificates representing the
Shares, and all expenses and taxes incident to the sale and delivery of
the Shares to you, including, without limitation, filing and recording
fees and expenses and fees and expenses of counsel for the Company for
providing such opinions as you may reasonably request.
(m) It will use its reasonable best efforts to
maintain the inclusion of the Common Stock on NASDAQ (or on a national
securities exchange) for a period of five years after the effective
date of the Registration Statement.
(n) It will use its reasonable best efforts to do and
perform all things required or necessary to be done and performed under
this Agreement by
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the Company prior to the Closing Date or any Option Closing Date, as
the case may be, and to use its reasonable best efforts to satisfy all
conditions precedent to the delivery of the Shares.
(o) It will use the proceeds from the sale of Shares
in the manner described in the Registration Statement under the caption
"Use of Proceeds."
(p) If the Registration Statement at the time of the
effectiveness of this Agreement does not cover all of the Shares, it
will file a Rule 462(b) Registration Statement with the Commission
registering the Shares not so covered in compliance with Rule 462(b) by
10:00 P.M., New York City time, on the date of this Agreement and to
pay to the Commission the filing fee for such Rule 462(b) Registration
Statement at the time of the filing thereof or to give irrevocable
instructions for the payment of such fee pursuant to Rule 111(b) under
the Act.
(q) The Company agrees that it will use the net
proceeds to it from the Shares in the manner described in the
Prospectus under the caption "Use of Proceeds". The Company further
agrees that on the Closing Date it will, in accordance with terms of
the indenture (the "INDENTURE") relating to its 10 1/4% Senior
Subordinated Notes due 2006 (the "NOTES"), give such notices to the
trustee and the holders of the relevant Notes and take such other
actions as may be required to exercise, at the earliest possible date,
its optional redemption right under the second paragraph of Section 3.1
of the Indenture with respect to the maximum amount of Notes redeemable
with such net proceeds under the terms of the Indenture.
6. Representations and Warranties of the Company. The Company
represents and warrants to each Underwriter that:
(a) The Registration Statement has become effective
(other than any Rule 462(b) Registration Statement to be filed by the
Company after the effectiveness of this Agreement); any Rule 462(b)
Registration Statement filed after the effectiveness of this Agreement
will become effective no later than 10:00 P.M., New York City time, on
the date of this Agreement; and no stop order suspending the
effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or, to the best
knowledge of the Company, threatened by the Commission.
(b)(i) Each document, if any, filed or to be filed
pursuant to the Exchange Act and incorporated by reference in the
Prospectus complied or will comply when so filed in all material
respects with the Exchange Act; (ii) each part of the Registration
Statement, as amended or supplemented, if applicable, when such part
became or becomes effective, did not contain and will not contain any
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untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, (iii) the Registration Statement and the
Prospectus comply and, as amended or supplemented, if applicable, will
comply, in all material respects with the Act and (iv) the Prospectus
does not contain and, as amended or supplemented, if applicable, will
not contain, any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, except
that the representations and warranties set forth in this paragraph (b)
shall not apply to statements or omissions in the Registration
Statement or the Prospectus (or any supplement or amendment to them)
based upon and conforming with information relating to any Underwriter
furnished to the Company in writing by or on behalf of such Underwriter
through the Representatives expressly for use therein. The Sellers and
the Underwriters acknowledge for all purposes under this Agreement
(including this paragraph, Section 6(c) hereof, Section 7(II)(a) hereof
and Section 8 hereof) that the statements with respect to price and
discount and the last paragraph on the cover page of the Prospectus and
the fourth, sixth, seventh, eighth, ninth, twelfth and thirteenth
paragraphs of the section entitled "Underwriting" in the Prospectus and
the information regarding stabilization on the inside front cover of
the preliminary Prospectus and the Prospectus (or any amendment or
supplement thereto) constitute the only information (the
"UNDERWRITERS' INFORMATION") furnished to the Company by or on behalf
of any Underwriter through the Representatives expressly for use in
the Registration Statement, the preliminary prospectus or the Prospec-
tus and that the Underwriters shall not be deemed to have provided any
other information (and therefore are not responsible for any statements
or omissions) pertaining to any arrangement or agreement with respect
to any party other than the Underwriters or any party to an arrangement
or agreement with the Under writers. No contract or document of a
character required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement
has not been described and filed as required.
(c) Each preliminary prospectus filed as part of the
registration statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Act, complied when so
filed in all material respects with the Act; and did not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading except that the representations and warranties set forth
in this paragraph do not apply to statements or omissions in any
preliminary prospectus based upon information relating to any
Underwriter furnished to the Company in writing by such Underwriter
through you expressly for use therein.
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(d) Each of the Company and its subsidiaries has been
duly incorporated, is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation or
organization and has full corporate power and authority to carry on
its business as described in the Prospectus and to own, lease and
operate its properties, and each is duly qualified and is in good
standing as a foreign corporation (or other entity) authorized to do
business in each jurisdiction in which the nature of its business or
its ownership or leasing of property requires such qualification,
except where the failure to be so qualified would not, individually or
in the aggregate, have a material adverse effect on the financial
condition or results of operation or business of the Company and its
subsidiaries, taken as a whole (a "MATERIAL ADVERSE EFFECT").
(e) There are no outstanding subscriptions, rights,
warrants, options, calls, convertible securities, commitments of sale
or Liens granted or issued by the Company or any of its subsidiaries
relating to or entitling any person to purchase or otherwise to acquire
any shares of the capital stock of the Company or any of its
subsidiaries, except as otherwise specifically referred to in the
Registration Statement or as contained in the Stockholders Agreement or
in the Secondary Stockholders Agreement (as such terms are defined in
the Prospectus), and except for Liens which, individually or in the
aggregate, would not have a Material Adverse Effect.
(f) The authorized, issued and outstanding capital
stock of the Company will be, as of the Closing Date, as set forth in
the Prospectus under the captions "Capitalization" and "Description of
Capital Stock" and in the Consolidated Financial Statements and the
notes thereto; all the outstanding shares of capital stock of the
Company (including the Shares to be sold by the Selling Stockholders)
have been duly authorized and validly issued and are fully paid,
non-assessable and not subject to any preemptive or similar rights; and
the Shares to be issued and sold by the Company have been duly
authorized and, when issued and delivered to the Underwriters against
payment therefor as provided by this Agreement, will be validly issued,
fully paid and non-assessable, and the issuance of such Shares will not
be subject to any preemptive or similar rights.
(g) All of the outstanding shares of capital stock
of, or other ownership interests in, each of the Company's subsidiaries
have been duly authorized and validly issued and are fully paid and
non-assessable, and are owned by the Company, directly or indirectly
through one or more subsidiaries, free and clear of any security
interest, mortgage, pledge, claim, lien, encumbrance or adverse
interest of any nature (each, a "LIEN"), other than Liens securing
indebtedness under or granted in connection with the Revolving Credit
Facility (as defined in the Prospectus), and except for Liens which,
individually or in the aggregate, would not have a Material Adverse
Effect.
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(h) The authorized capital stock of the Company,
including the Common Stock, conforms as to legal matters to the
description thereof contained in the Prospectus.
(i) Neither the Company nor any of its subsidiaries
is in violation of its respective charter or by-laws or in default in
the performance of any obligation, agreement or condition contained in
any bond, note, debenture, or other evidence of indebtedness or any
indenture, mortgage, deed of trust or other contract, lease, or other
instrument to which the Company or any of its subsidiaries is a party
or by which it or any of its subsidiaries or their respective property
is bound, which violations or defaults, individually or in the
aggregate, would have a Material Adverse Effect.
(j) The Company has all the requisite corporate power
to execute, deliver and perform its obligations under this Agreement
and to authorize, issue and sell the Shares. Except as disclosed in the
Registration Statement, the execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby do not
and on the Closing Date and on any Option Closing Date, as applicable,
will not (i) conflict with or result in a breach or violation of any of
the respective charter or bylaws of the Company or any of its
subsidiaries or of any of the terms or provisions thereof as in effect
on such respective dates, or (ii) constitute a default or cause an
acceleration of any obligation under or result in the imposition or
creation of (or the obligation to create or impose) a Lien (as herein
after defined) with respect to, any of the respective charters or
bylaws of the Company or any of its subsidiaries or any material bond,
note, debenture or other evidence of indebtedness or any indenture,
mortgage, deed of trust or other material contract, lease, or other
instrument, as applicable, to which the Company or any of its
subsidiaries is a party or by which any of them is bound, or to which
any of the property or assets of the Company or any of its subsidiaries
is or may be subject, except for any such violation or default which,
individually or in the aggregate, would not have a Material Adverse
Effect, or (iii) contravene any order of any court or governmental
agency or authority having jurisdiction over the Company, any of its
subsidiaries or any of their respective properties entered in any
proceeding to which the Company or any of its subsidiaries was or is a
party or by which any of them is bound or violate or conflict with any
applicable Federal, state or local law, rule, administrative regulation
or ordinance or administrative or court decree applicable to the
Company, any of its subsidiaries or their respective properties except
for such defaults, accelerations or contraventions that, individually
or in the aggregate, would not have a Material Adverse Effect.
(k) Except as otherwise set forth in the Prospectus
and except for such actions, suits or proceedings which, individually
or in the aggregate, would not have a Material Adverse Effect, there is
no action, suit or proceeding
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before or by any court or governmental agency or body, domestic or
foreign, pending against the Company or any of its subsidiaries or of
which any of their respective property is the subject, and, to the
best of the Company's knowledge, no such proceedings are threatened or
contemplated.
(l) In each case, except as would not, individually
or in the aggregate, have a Material Adverse Effect: neither the
Company nor any of its subsidiaries is in violation of any Federal,
state, local or foreign laws and regulations relating to pollution or
protection of human health or the environment (including, without
limitation, ambient air, surface water, ground water, land surface or
subsurface strata), including, without limitation, laws and regulations
relating to emissions, discharges, releases or threatened releases of
chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum and petroleum products ("MATERIALS OF
ENVIRONMENTAL CONCERN"), or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport
or handling of Materials of Environmental Concern in connection with
protection of human health or the environment (collectively,
"ENVIRONMENTAL LAWS"), which violation includes, but is not limited to,
noncompliance with any permits or other governmental authorizations
required for the operation of the business of the Company or any of its
subsidiaries, under applicable Environmental Laws, or noncompliance
with the terms and conditions thereof, nor has the Company, received
any communication (written or oral), whether from a govern mental
authority, citizens group, employee or otherwise, that alleges that the
Company or any of its subsidiaries is in violation and there are no
circumstances, either past, present or that are reasonably foreseeable,
that will or could reason ably be expected to lead to such violation in
the future. In addition, except as disclosed in the Registration
Statement or the Prospectus, or in each case as would not, individually
or in the aggregate, have a Material Adverse Effect: there is no claim,
action, cause of action, investigation or notice (written or oral) by
any person or entity alleging potential liability for investigatory
costs, cleanup costs, governmental responses costs, natural resources
damages, property damages, personal injuries, attorneys' fees or
penalties arising out of, based on or resulting from (a) the presence,
or release into the environment, of any Material of Environmental
Concern at any location owned or operated by the Company or any of its
subsidiaries, now or in the past, or (b) circumstances forming the
basis of any violation, or alleged violation, of any Environmental Law
(collectively, "ENVIRONMENTAL CLAIMS"), pending or, to the knowledge
of the Company, threatened against the Company or any of its
subsidiaries or, to the knowledge of the Company, against any person
or entity whose liability for any Environmental Claim the Company or
any such subsidiary has retained or assumed either contractually or by
operation of law; to its knowledge, there are no past or present
actions, activities, circumstances, conditions, events or incidents,
including, without limitation, the release, emission, discharge,
presence or disposal of any Material of Envi-
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ronmental Concern, that will or could reasonably be expected to result
in a violation of any Environmental Law or form the basis of any
Environmental Claim against the Company or any of its subsidiaries or
against any person or entity whose liability for any Environmental
Claim the Company has retained or assumed either contractually or by
operation of law.
(m) As of the Closing Date and at each Option Closing
Date, if any, the Company and its subsidiaries will possess such
licenses, certificates, authorizations, approvals, franchises, permits
and other rights issued by local, state, Federal or foreign regulatory
agencies or bodies (collectively, "PERMITS") as are necessary to own,
lease and operate its respective properties and to conduct the
businesses now conducted by them except where the failure to possess
any such Permit would not have a Material Adverse Effect; as of the
Closing Date and at each Option Closing Date, if any, the Company and
each of its subsidiaries will have fulfilled and performed all of its
material obligations with respect to such Permits and neither the
Company nor its subsidiaries will have received any notice of
proceedings relating to the revocation or modification of any such
Permit that is reasonably likely to have a Material Adverse Effect.
(n) Neither the Company nor any of its subsidiaries
has any knowledge of any actionable violation of any Federal, state or
local law relating to employment and employment practices,
discrimination in the hiring, promotion or pay of employees nor any
applicable wage or hour laws, except for any such violation which,
individually or in the aggregate, would not result in a Material
Adverse Effect. There is (A) no significant unfair labor practice
complaint pending against the Company or any of its subsidiaries or,
to the knowledge of the Company, threatened against any of them, before
the National Labor Relations Board or any state or local labor
relations board, and no significant grievance or significant
arbitration proceeding arising out of or under any collective
bargaining agreement is pending against the Company or any of its
subsidiaries or, to the knowledge of the Company, threatened against
any of them, (B) no labor strike, dispute, slowdown or stoppage ("LABOR
DISPUTE") in which the Company or any of its subsidiaries is involved
nor, to the knowledge of the Company, is any Labor Dispute imminent;
other than routine disciplinary and grievance matters, the Company is
not aware of any existing or imminent Labor Dispute by the employees
of any of its principal suppliers, manufacturers or contractors and (C)
no question concerning union representation within the meaning of the
National Labor Relations Act existing with respect to the employees of
the Company and, to the knowledge of the Company, no union organizing
activities are taking place, except (with respect to any matter
specified in clause (A), (B) or (C) above, singly or in the aggregate)
such as would not have a Material Adverse Effect.
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(o) Subject to Liens securing indebtedness under the
Revolving Credit Facility or disclosed in the Registration Statement,
including capitalized leases, the Company and each of its subsidiaries
has good and marketable title, free and clear of all Liens, to all
property and assets described in the Prospectus as being owned by it
excluding any Liens that would not have a Material Adverse Effect. All
leases to which the Company or any of its subsidiaries is a party are
valid and binding and no default by the Company or any Subsidiary or,
to the Company's knowledge, any other party has occurred or is
continuing thereunder, except for any such defaults which, individually
or in the aggregate, would not result in a Material Adverse Effect, and
the Company and its subsidiaries enjoy peaceful and undisturbed
possession under all such leases to which any of them is a party as
lessee with such exceptions as would not, individually or in the aggre-
gate, have a Material Adverse Effect.
(p) The Company and its subsidiaries maintain
insurance covering their properties, operations, personnel and
businesses, including without limitation, product liability insurance.
Neither the Company nor any of its subsidiaries has received written
notice from any insurer or agent of such insurer that substantial
capital improvements or other similar expenditures will have to be made
in order to continue such insurance. All such insurance is outstanding
and duly in force on the date hereof and will be outstanding and duly
in force on the Closing Date and on any Option Closing Date, as
applicable.
(q) This Agreement has been duly authorized, executed
and delivered by the Company.
(r) Deloitte & Touche LLP are independent public
accountants with respect to the Company and its subsidiaries, as
required by the Act.
(s) The consolidated financial statements of the
Company, together with related notes and schedules, set forth or
incorporated by reference in the Registration Statement and the
Prospectus (and any amendments or supplements thereto) comply as to
form in all material respects with the requirements of the Act and the
Exchange Act and fairly present the consolidated financial position of
the Company and its subsidiaries at the respective dates indicated and
the results of their operations and their cash flows for the respective
periods indicated, in accordance with generally accepted accounting
principles in the United States of America consistently applied
throughout such periods. The pro forma financial data included in the
Registration Statement and the Prospectus have been prepared on a basis
consistent with such historical statements, except for the pro forma
adjustments specified therein, and give effect to assumptions made on a
reasonable basis and present fairly the transactions reflected thereby
as indicated in the Registration Statement and the Prospectus and
comply in all material respects with the
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applicable accounting requirements of rule 11-02 of Regulation S-X and
the pro forma adjustments have been properly applied to the historical
amounts in the compilation of those statements.
(t) Except as otherwise disclosed in the Registration
Statement, tax returns required to be filed by the Company and its
subsidiaries in any jurisdiction have been filed, other than those
filings that are being contested in good faith, except where failure to
so file would not have a Material Adverse Effect, and all taxes,
including withholding taxes, penalties and interest, assessments, fees
and other governmental charges due or claimed to be due from such
entities have been paid other than those being contested in good faith
and for which adequate reserves have been provided, except where
failure to so pay would not have a Material Adverse Effect.
(u) As of the Closing Date and each Option Closing
Date, the Company and each of its subsidiaries will own or possess all
patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures),
trademarks, service marks and trade names (collectively, the "INTEL
LECTUAL PROPERTY") presently employed by it in connection with the
businesses now operated by them, except where the failure to so own or
possess would not, individually or in the aggregate, have a Material
Adverse Effect, and neither the Company nor any of its subsidiaries
will have received any notice of infringement of or conflict with
asserted rights of others with respect to any of the foregoing, except
where such infringement or conflict would not individually, or in the
aggregate, have a Material Adverse Effect. To the Company's knowledge,
the use of the Intellectual Property in connection with the business
and operations of the Company and its subsidiaries does not infringe on
the rights of any person, except where such infringement does not,
individually or in the aggregate, have a Material Adverse Effect. The
representations in this clause (u) exclude Intellectual Property
matters with respect to any foreign country that has not accounted for
more than 1% of the sales of the Company and its subsidiaries in either
of the last two fiscal years.
(v) The Company and each of its subsidiaries
maintains a system of internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in
accordance with management's general or specific authorizations; (ii)
transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting
principles and to maintain asset accountability; (iii) access to assets
is permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for inventory
assets is compared with the existing inventory
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assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(w) Neither the Company nor any of its subsidiaries
has, directly or indirectly, paid or delivered any fee, commission or
other sum of money or item of property, however characterized, to any
finder, agent, government official or other party, in the United
States or any other country, which is in any manner related to the
business or operations of the Company or its subsidiaries which the
Company or any of its subsidiaries knows or has reason to believe to
have been illegal under any Federal, state or local laws of the United
States or any other country having jurisdiction, except as would not
have a Material Adverse Effect; neither the Company nor any of its
subsidiaries, has participated, directly or indirectly, in any boycotts
or other similar practices in contravention of law affecting any of
its actual or potential customers.
(x) The Company is not and, after giving effect to
the offering and sale of the Shares and the application of the proceeds
thereof as described in the Prospectus, will not be, (i) an "investment
company" or a company "controlled" by an "investment company" as such
term is defined in the Investment Company Act of 1940, as amended, or
(ii) a "holding company" or a "subsidiary company" of a holding
company, or an "affiliate" thereof within the meaning of the Public
Utility Holding Company Act of 1935, as amended.
(y) There are no contracts, agreements or
understandings between the Company and any person granting such person
the right (i) to require the Company to file a registration statement
under the Act with respect to any securities of the Company, except
for such rights as exist under the Stockholders Agreement and the
Secondary Stockholders Agreement or (ii) to require the Company to
include any securities with the Shares registered pursuant to the
Registration Statement, except such rights as have been duly waived in
writing by such person.
(z) The Company has complied with all provisions of
Section 517.075, Florida Statutes (Chapter 92-198, Laws of Florida).
(aa) Except as disclosed or incorporated by reference
in the Prospectus, there are no business relationships or related party
transactions required to be disclosed therein by Item 404 of Regulation
S-K of the Commission.
(ab) The Company has applied to have the Shares
listed on NASDAQ.
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(ac) Except as contemplated by the Registration
Statement and the Prospectus, subsequent to the respective dates as of
which information is given in the Registration Statement and the
Prospectus, (i) neither the Company nor any of its subsidiaries has
incurred any liabilities or obligations, direct or contingent, which
are material to the Company and its subsidiaries, taken as a whole, nor
entered into any transaction not in the ordinary course of business
that is material to the Company and its subsidiaries, taken as a whole,
(ii) there has been no decision or judgment in any litigation to which
the Company or any of its subsidiaries are a party which could,
individually or in the aggregate, result in a Material Adverse Effect,
and (iii) there has been no material adverse change in the financial
condition or in the results of operations or business of the Company
and its subsidiaries, taken as a whole (any of the items set forth in
clauses (i), (ii), or (iii), above, a "MATERIAL ADVERSE CHANGE").
(ad) To the Company's knowledge, no action has been
taken with respect to the Company or any of its subsidiaries, and no
statute, rule or regulation or order has been enacted, adopted or
issued by any governmental agency which prevents the issuance of the
Shares, suspends the effectiveness of the Registration Statement,
prevents or suspends the use of any preliminary Prospectus or suspends
the sale of the Shares in any jurisdiction referred to in Section 5(g)
hereof; no injunction, restraining order or order of any nature by a
Federal or state court of competent jurisdiction has been issued with
respect to the Company or any of its subsidiaries which would prevent
or suspend the issuance or sale of the Shares, the effectiveness of the
Registration Statement or the use of any preliminary prospectus or the
Prospectus in any jurisdiction referred to in Section 5(g) hereof; no
action, suit or proceeding before any court or arbitrator or any
governmental body, agency or official (domestic or foreign) is pending
against or, to the knowledge of the Company, threatened against, the
Company or any of its subsidiaries which, if adversely determined,
could reasonably be expected to prevent the issuance of the Shares or
in any manner invalidate this Agreement; and every request of the Com
mission or any securities authority or agency of any jurisdiction for
additional in formation (to be included in the Registration Statement
or the Prospectus or other wise) that has been communicated to the
Company has been complied with in all material respects or responded to
in a manner acceptable to the Commission or such other securities
authority.
7. Representation and Warranties of the Selling Stockholders.
(I) Each Selling Stockholder represents and warrants to each
Underwriter that:
(a) Such Selling Stockholder is the lawful owner of the Shares
to be sold by such Selling Stockholder pursuant to this Agreement and has, and
on the Closing
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Date and on the Option Closing Date will have, good and clear
title to the Shares to be sold on the Closing Date or the Option Closing Date,
free of all restrictions on transfer, liens, encumbrances, security interests,
equities and claims whatsoever.
(b) The Shares to be sold by such Selling Stockholder have
been duly authorized and are validly issued, fully paid and non-assessable.
(c) Such Selling Stockholder has, and on the Closing Date and
the Option Closing Date will have, full legal right, power and authority, and
all authorization and approval required by law, to enter into this Agreement,
the Custody Agreement signed by such Selling Stockholder and American Securities
Transfer & Trust, Inc., as Custodian, relating to the deposit of the Shares to
be sold by such Selling Stockholder (the "CUSTODY AGREEMENT") and the Power of
Attorney of such Selling Stockholder appointing certain individuals as such
Selling Stockholder's attorneys-in-fact (the "ATTORNEYS") to the extent set
forth therein, relating to the transactions contemplated hereby and by the
Registration Statement and the Custody Agreement (the "POWER OF ATTORNEY") and
to sell, assign, transfer and deliver the Shares to be sold by such Selling
Stockholder in the manner provided herein and therein.
(d) This Agreement has been duly authorized, executed and
delivered by or on behalf of such Selling Stockholder.
(e) The Custody Agreement of such Selling Stockholder has been
duly authorized, executed and delivered by such Selling Stockholder and is a
valid and binding agreement of such Selling Stockholder, enforceable in
accordance with its terms.
(f) The Power of Attorney of such Selling Stockholder has been
duly authorized, executed and delivered by such Selling Stockholder and is a
valid and binding instrument of such Selling Stockholder, enforceable in
accordance with its terms, and, pursuant to such Power of Attorney, such Selling
Stockholder has, among other things, authorized the Attorneys, or any one of
them, to execute and deliver on such Selling Stockholder's behalf this Agreement
and any other document that they, or any one of them, may deem necessary or
desirable in connection with the transactions contemplated hereby and thereby
and to deliver the Shares to be sold by such Selling Stockholder pursuant to
this Agreement.
(g) Upon delivery of and payment for the Shares to be sold by
such Selling Stockholder pursuant to this Agreement, good and clear title to
such Shares will pass to the Underwriters, free of all restrictions on transfer,
liens, encumbrances, security interests, equities and claims whatsoever.
(h) The execution, delivery and performance of this Agreement
and the Custody Agreement and Power of Attorney of such Selling Stockholder by
or on
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behalf of such Selling Stockholder, the compliance by such Selling Stockholder
with all the provisions hereof and thereof and the consummation of the
transactions contemplated hereby and thereby will not (i) require any consent,
approval, authorization or other order of, or qualification with, any court or
governmental body or agency (except such as may be required under the securities
or Blue Sky laws of the various states), (ii) conflict with or constitute a
breach of any of the terms or provisions of, or a default under, the organiza-
tional documents of such Selling Stockholder, if such Selling Stockholder is not
an individual, or any indenture, loan agreement, mortgage, lease or other
agreement or instrument to which such Selling Stockholder is a party or by which
such Selling Stock holder or any property of such Selling Stockholder is bound
or (iii) violate or conflict with any applicable law or any rule, regulation,
judgment, order or decree of any court or any governmental body or agency having
jurisdiction over such Selling Stockholder or any property of such Selling
Stockholder.
(i) The information in the Registration Statement under the
caption "Principal and Selling Stockholders" which specifically relates to such
Selling Stockholder does not, and will not on the Closing Date or the Option
Closing Date, contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(j) At any time during the period described in Section 5(d),
if there is any change in the information referred to in Section 7(i), such
Selling Stockholder will immediately notify you of such change.
(k) Each certificate signed by or on behalf of such Selling
Stockholder and delivered to the Underwriters or counsel for the Underwriters
shall be deemed to be a representation and warranty by such Selling Stockholder
to the Underwriters as to the matters covered thereby.
(II) In addition to the representations and warranties set forth in
Section 7(I) above, Green Equity Investors II, L.P. ("GEI") represents and
warrants to each Under writer that:
(a) To the knowledge of GEI, the Prospectus does not contain
and, as amended or supplemented, if applicable, will not contain, any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, except that the representations and warranties set forth
in this paragraph (a) shall not apply to statements or omissions in the
Prospectus (or any supplement or amendment to them) based upon and conforming
with information relating to any Underwriter furnished to the Company in writing
by or on behalf of such Underwriter through the Representatives expressly for
use therein.
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(b) GEI has no knowledge of any material event or occurrence
which is not disclosed in the Prospectus which has materially and adversely
affected the operations or financial condition of the Company and its
subsidiaries taken as a whole; and the sale of Shares by GEI pursuant hereto is
not prompted by any material information concerning the Company which is not set
forth in the Prospectus.
8. Indemnification. (a) The Company agrees to indemnify and hold
harmless each Underwriter, its directors, its officers and each person, if any,
who controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act from and against any and all losses, claims,
damages, liabilities and judgments (including, without limitation, any legal or
other expenses incurred in connection with investigating or defending any
matter, including any action, that could give rise to any such losses, claims,
damages, liabilities or judgments) caused by any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement (or
any amendment thereto), the Prospectus (or any amendment or supplement thereto)
or any preliminary prospectus, or caused by any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or judgments are caused by any such untrue statement or
omission or alleged untrue statement or omission based upon information relating
to any Underwriter furnished in writing to the Company by such Underwriter
through you expressly for use therein; provided, however, that the foregoing
indemnity agreement with respect to any preliminary prospectus shall not inure
to the benefit of any Underwriter who failed to deliver a Prospectus, as then
amended or supplemented, (so long as the Prospectus and any amendment or
supplement thereto was provided by the Company to the several Underwriters in
the requisite quantity and on a timely basis to permit proper delivery on or
prior to the Closing Date) to the person asserting any losses, claims, damages,
liabilities or judgments caused by any untrue statement or alleged untrue
statement of a material fact contained in the preliminary prospectus, or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading, if
such material misstatement or omission or alleged material misstatement or
omission was cured in the Prospectus, as so amended or supplemented, and such
Prospectus was required by law to be delivered at or prior to the written
confirmation of sale to such person.
(b) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its officers who sign
the Registration Statement, each person, if any, who controls the Company within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, each
Selling Stockholder and each person, if any, who controls such Selling
Stockholder within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from the Company to
such Underwriter but only with reference to information relating to such
Underwriter furnished in writing to the Company by such Underwriter through you
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expressly for use in the Registration Statement (or any amendment thereto), the
Prospectus (or any amendment or supplement thereto) or any preliminary
prospectus.
(c) Each Selling Stockholder agrees, severally and not
jointly, to indemnify and hold harmless the Company, its directors, its officers
who sign the Registration Statement, each person, if any, who controls the
Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, each Underwriter, its directors, its officers and each person, if
any, who controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act to the same extent as the foregoing indemnity
from the Company to the Underwriters set forth in Section 8(a) above, but only
with reference to information relating to such Selling Stockholder furnished in
writing to the Company by such Selling Stockholder expressly for use in the
Registration Statement (or any amendment thereto), the Prospectus (or any
amendment or supplement thereto) or any preliminary prospectus. Notwithstanding
the foregoing, the aggregate liability of any Selling Stockholder pursuant to
this Section 8(c) shall be limited to an amount equal to the total proceeds
(before deducting underwriting discounts and commissions and expenses) received
by such Selling Stockholder from the Underwriters for the sale of the Shares
sold by such Selling Stockholder hereunder.
(d) In case any action shall be commenced involving any person
in respect of which indemnity may be sought pursuant to Section 8(a), 8(b) or
8(c) (the "INDEMNIFIED PARTY"), the indemnified party shall promptly notify the
person against whom such indemnity may be sought (the "INDEMNIFYING PARTY") in
writing and the indemnifying party shall assume the defense of such action,
including the employment of counsel reasonably satisfactory to the indemnified
party and the payment of all fees and expenses of such counsel, as incurred
(except that in the case of any action in respect of which indemnity may be
sought pursuant to both Section (b) on the one hand and either or both of
Sections 8(a) or 8(c) on the other hand, the Underwriter shall not be required
to assume the defense of such action pursuant to this Section 8(d), but may
employ separate counsel and participate in the defense thereof, but the fees and
expenses of such counsel, except as provided below, shall be at the expense of
such Underwriter). Any indemnified party shall have the right to employ separate
counsel in any such action and participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of the indemnified party
unless (i) the employment of such counsel shall have been specifically
authorized in writing by the indemnifying party, (ii) the indemnifying party
shall have failed to assume the defense of such action or employ counsel
reasonably satisfactory to the indemnified party or (iii) the named parties to
any such action (including any impleaded parties) include both the indemnified
party and the indemnifying party, and the indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party (in which case the indemnifying party shall not have the
right to assume the defense of such action on behalf of the indemnified party).
In any such case, the indemnifying party shall not, in connection with any one
action or separate but
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substantially similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances, be liable for (i) the fees and
expenses of more than one separate firm of attorneys (in addition to any local
counsel) for all Underwriters, their officers and directors and all persons, if
any, who control any Underwriter within the meaning of either Section 15 of the
Act or Section 20 of the Exchange Act, (ii) the fees and expenses of more than
one separate firm of attorneys (in addition to any local counsel) for the
Company, its directors, its officers who sign the Registration Statement and all
persons, if any, who control the Company within the meaning of either such
Section and (iii) the fees and expenses of more than one separate firm of
attorneys (in addition to any local counsel) for all Selling Stockholders and
all persons, if any, who control any Selling Stockholder within the meaning of
either such Section, and all such fees and expenses shall be reimbursed as they
are incurred. In the case of any such separate firm for the Under writers, their
officers and directors and such control persons of any Underwriters, such firm
shall be designated in writing by Bear, Xxxxxxx & Co. Inc. In the case of any
such separate firm for the Company and such directors, officers and control
persons of the Company, such firm shall be designated in writing by the Company.
In the case of any such separate firm for the Selling Stockholders and such
control persons of any Selling Stockholders, such firm shall be designated in
writing by the Attorneys. The indemnifying party shall indemnify and hold
harmless the indemnified party from and against any and all losses, claims,
damages, liabilities and judgments by reason of any settlement of any action (i)
effected with its written consent or (ii) effected without its written consent
if the settlement is entered into more than twenty business days after the
indemnifying party shall have received a request from the indemnified party for
reimbursement for the fees and expenses of counsel (in any case where such fees
and expenses are at the expense of the indemnifying party) and, prior to the
date of such settlement, the indemnifying party shall have failed to comply with
such reimbursement request. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement or compromise
of, or consent to the entry of judgment with respect to, any pending or
threatened action in respect of which the indemnified party is or could have
been a party and indemnity or contribution may be or could have been sought
hereunder by the indemnified party, unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability on claims that are or could have been the subject matter of such
action and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of the indemnified party.
(e) To the extent the indemnification provided for in this
Section 8 is unavailable to an indemnified party or insufficient in respect of
any losses, claims, damages, liabilities or judgments referred to therein, then
each indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Sellers on the one hand and the Underwriters on the other hand from the offering
of the Shares or (ii) if the allocation provided by clause 8(e)(i) above is not
permitted by
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applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause 8(e)(i) above but also the relative
fault of the Company, the Selling Stockholders and the Underwriters in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative benefits received by the Sellers on the
one hand and the Underwriters on the other hand shall be deemed to be in the
same proportion as the total net proceeds from the offering (after deducting
underwriting discounts and commissions, but before deducting expenses) received
by the Sellers, and the total underwriting discounts and commissions received by
the Underwriters, bear to the total price to the public of the Shares, in each
case as set forth in the table on the cover page of the Prospectus. The relative
fault of the Sellers on the one hand and the Underwriters on the other hand
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company or the
Selling Stockholders on the one hand or the Underwriters on the other hand and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
The Sellers and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 8(e) were determined
by pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses incurred by such indemnified party in
connection with investigating or defending any matter, including any action,
that could have given rise to such losses, claims, damages, liabilities or
judgments. Notwithstanding the provisions of this Section 8, (i) no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Shares under written by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission, (ii) in no case shall
any Underwriter be liable or responsible for any amount in excess of the
underwriting discount applicable to the Shares purchased by such Underwriter
hereunder, and (iii) in no case shall any Selling Stockholder be liable or
responsible for any amount in excess of the proceeds received by such Selling
Stockholder from the sale of Shares sold by such Selling Stockholder hereunder.
No person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to this Section 8(e) are several in proportion to the
respective number of Shares purchased by each of the Underwriters hereunder and
not joint.
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(f) The remedies provided for in this Section 8 are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
(g) Each Selling Stockholder hereby designates [Twinlab
Corporation, 0000 Xxxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxx Xxxx 00000, Attention:
General Counsel], as its authorized agent, upon which process may be served in
any action which may be instituted in any state or federal court in the State of
New York by any Underwriter, any director or officer of any Underwriter or any
person controlling any Underwriter asserting a claim for indemnification or
contribution under or pursuant to this Section 8, and each Selling Stockholder
will accept the jurisdiction of such court in such action, and waives, to the
fullest extent permitted by applicable law, any defense based upon lack of
personal jurisdiction or venue. A copy of any such process shall be sent or
given to such Selling Stockholder, at the address for notices specified in
Section 13 hereof.
9. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters to purchase the Firm Shares under this Agreement
are subject to the satisfaction of each of the following conditions:
(a) All the representations and warranties of the Company
contained in this Agreement shall be true and correct in all material
respects on the Closing Date with the same force and effect as if made
on and as of the Closing Date.
(b) The Registration Statement shall have become effective not
later than 5:00 P.M. (and, in the case of a Registration Statement
filed under Rule 462(b) of the Act, not later than 10:00 P.M.), New
York City time, on the date of this Agreement or at such later date and
time as you may approve in writing, and at the Closing Date no stop
order suspending the effectiveness of the Registration Statement shall
have been issued and no proceedings for that purpose shall have been
commenced or shall be pending before or contemplated by the Commission.
(c)(i) Since the date of the latest balance sheet included in
the Registration Statement and the Prospectus, there shall not have
been any Material Adverse Change, or any development involving a
prospective Material Adverse Change, (ii) since the date of the latest
balance sheet included in the Registration Statement and the Prospectus
there shall not have been any material change, or any development
involving a prospective material change in the capital stock or in the
long-term debt of the Company from that set forth or referred to in the
Registration Statement and Prospectus, (iii) the Company and its
subsidiaries shall have no liability or obligation, direct or
contingent, which is material to the Company and its subsidiaries,
taken as a whole, other than those reflected in the Registration
Statement and the Prospectus and (iv) on the Closing Date you shall
have received a certificate dated the Closing Date, signed by the
President and Chief Executive
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Officer and a principal financial or accounting officer of the Company,
confirming the matters set forth in paragraphs (a), (b) and (c) of this
Section 9.
(d) All the representations and warranties of each Selling
Stockholder contained in this Agreement shall be true and correct on
the Closing Date with the same force and effect as if made on and as of
the Closing Date and you shall have received on the Closing Date a
certificate dated the Closing Date from each Selling Stockholder to
such effect and to the effect that such Selling Stockholder has
complied with all of the agreements and satisfied all of the conditions
herein contained and required to be complied with or satisfied by such
Selling Stock holder on or prior to the Closing Date.
(e) You shall have received on the Closing Date an opinion
satisfactory to you and counsel for the Underwriters, dated the
Closing Date, of Xxxxxx X. Xxxxx, Esq., General Counsel of the Company,
to the effect that:
(i) the Company and each of the Subsidiaries is duly
qualified and is in good standing as a foreign corporation
authorized to do business in each jurisdiction in which the
nature of its business or its ownership or leasing of property
requires such qualification, except where the failure to be so
qualified or to be in good standing would not, individually or
in the aggregate, have a Material Adverse Effect;
(ii) based solely upon a review of the stock record
books of the Subsidiaries, inquiries of certain officers of
the Subsidiaries and a review of corporate resolutions of the
Subsidiaries, all of the outstanding shares of capital stock
of each of the Subsidiaries are owned directly or indirectly,
as applicable, by the Company free and clear of any security
interest, mortgage, pledge, claim, lien or encumbrance of any
nature (each, a "LIEN") except for Liens incurred pursuant to
the terms of the Revolving Credit Facility and Liens which,
individually or in the aggregate, would not have a Material
Adverse Effect;
(iii) based solely upon a review of the material
agreements and instruments to which the Company or the
Subsidiaries is a party, to the best of such counsel's
knowledge, there are no material agreements or instruments to
which the Company or the Subsidiaries is a party or by which
any of them or any of their property may be bound which is re-
quired to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit thereto that is not
described or filed as required;
(iv) based solely upon a review of auditors' response
letters and inquiry of responsible officers of the Company and
the Subsidiaries, to
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the best of such counsel's knowledge there are no material
legal or govern mental actions, suits or proceeding pending or
threatened to which the Company, any of the Subsidiaries or
any of their respective property is subject which are required
to be disclosed in the Registration Statement or the
Prospectus, other than those disclosed therein;
(v) neither the Company nor any of the Subsidiaries
is in violation of its respective charter or by-laws. To the
best of such counsel's knowledge, neither the Company nor any
of the Subsidiaries is in default or violation of, and the
execution and delivery by the Company of this Agreement and
the sale by the Company to the Underwriters of the Shares
pursuant thereto does not violate the terms of, any
obligation, agreement or condition contained in any bond,
note, debenture, or other evidence of indebtedness or any
indenture, mortgage, deed of trust or other contract, lease or
instrument to which the Company or any of the Subsidiaries is
a party or by which the Company or any of the Subsidiaries or
their respective property is bound, except for such violations
as will not, individually or in the aggregate, have a Material
Adverse Effect;
(vi) to the best of such counsel's knowledge, the
Company and each of the Subsidiaries have such Permits, as are
necessary to own, lease and operate its respective properties
and to conduct its business in the manner described in the
Prospectus, except for such Permits, the absence of which will
not, individually or in the aggregate, have a Material Ad
verse Effect. To the best of such counsel's knowledge, the
Company and each of the Subsidiaries have fulfilled and
performed all of their respective material obligations with
respect to such Permits and no event has occurred which
allows, or after notice or lapse of time would allow, revoca-
tion or termination thereof, subject in each case to such
qualification as many be set forth in the Prospectus, and
except for such revocation or terminations, as the case may
be, as would not, individually or in the aggregate, have a
Material Adverse Effect;
(vii) the authorized, issued and outstanding capital
stock of the Company is as set forth in the Prospectus under
"Capitalization" and "Description of Capital Stock" and in
the Consolidated Financial Statements of Twinlab Corporation
and Subsidiaries and the notes thereto; and
(viii) to the best of such counsel's knowledge,
neither the Company nor any of the Subsidiaries has violated
any Federal or New York state law relating to discrimination
on the hiring, promotion or pay of employees nor any
applicable Federal or New York state wages and
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hours law which in each case is likely to result in a Material
Adverse Effect.
In addition, such counsel shall state that such counsel has
participated in conferences with officers and other representatives of the
Company and its subsidiaries and discussions with auditors of the Company and
its subsidiaries in connection with the preparation of the Registration
Statement and the Prospectus and such counsel shall advise you that nothing has
come to the attention of such counsel that has led such counsel to believe that
the Registration Statement, as amended or supplemented, at the time such
Registration Statement, such 462(b) Registration Statement (if applicable) or
any post-effective amendment became effective, contained an untrue statement of
a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, and that
the Prospectus, as amended or supplemented, if applicable, contained an untrue
statement of a material fact or omitted to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
In giving his opinion with respect to the matters covered by
the immediately preceding paragraph, such counsel may state that his opinion
and belief are based upon his participation in the preparation of the
Registration Statement, the 462(b) Registration Statement (if applicable) and
the Prospectus and any amendments or supplements thereto and documents
incorporated therein by reference and review and discussion of the contents
thereof, but are without independent check or verification except as required to
give the opinions covered by clauses (iii), (iv), (vi) and (vii) of paragraph
(e) above. In addition, such counsel may state that such counsel's opinion does
not include or cover the financial statements and notes thereto and related
schedules and other financial, numerical, statistical and accounting data
contained in or omitted from the Registration Statement.
(f) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for the Underwriters), dated the
Closing Date, of Kramer, Levin, Naftalis & Xxxxxxx ("XXXXXX XXXXX")
counsel for the Company and the Selling Stockholders, to the effect
that:
(i) the Company has been duly incorporated and is a
corporation validly existing and in good standing under the
laws of Delaware. The Company's direct subsidiary, Twin
Laboratories Inc. ("TWIN"), is duly qualified as foreign
corporation and in good standing under the laws of the State
of New York. The Company's indirect subsidiaries, Advanced
Research Press, Inc. and Changes International of Fort Xxxxxx
Beach, Inc. ("ARP" and "CHANGES," respectively, and together
with Twin, the "SUBSIDIARIES"), are corporations validly
existing and in good standing under the laws of the State of
New York and __, respectively;
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(ii) each of the Company, ARP and Changes has the
requisite corporate power and authority to own, lease and
operate its properties and to conduct its business as
described in the Registration Statement;
(iii) all of the shares of issued and outstanding
capital stock of the Company have been duly authorized and
validly issued and are fully-paid and non-assessable. All of
the issued and outstanding shares of capital stock of ARP and
Changes have been duly authorized and validly issued and are
fully-paid and non-assessable;
(iv) the Shares to be issued and sold by the Company
hereunder have been duly authorized and, when issued and
delivered to the Underwriters against payment therefor as
provided by this Agreement, will be validly issued, fully paid
and non-assessable, and the issuance of such Shares is not
subject to preemptive or other similar rights arising by
operation of law or the Company's Certificate of Incorporation
and ByLaws;
(v) the Company has the corporate power and authority
to execute, deliver and perform its obligations under this
Agreement and to consummate the transactions contemplated
hereby. This Agreement has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement
of the Company, enforceable in accordance with its terms;
(vi) the Registration Statement has become effective
under the Act and, to the best of such counsel's knowledge, no
stop order suspending the effectiveness of the Registration
statement has been issued under the Act or proceedings
therefor initiated or threatened by the Commission;
(vii) at the time the Registration Statement became
effective and on the Closing Date, the Registration Statement
(other than the financial statements and the notes thereto and
related schedules and other financial, numerical, statistical
or accounting data included therein or omitted there from, as
to which we express no opinion) complied as to form in all
material respects with the requirements of the Act and the
Regulations;
(viii) the capital stock of the Company, including
the Common Stock, conforms in all material respects to the
statements relating thereto contained in the Prospectuses
under the caption "Description of Capital Stock;"
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(ix) the statements in the Prospectus under the
captions "Risk Factors - Shares Eligible for Future Sale,"
"Management - Employment Agreements," "Principal and Selling
Stockholders - Terms of the Stock holders Agreement,"
"Description of Certain Indebtedness," "Shares Eligible for
Future Sale," "Certain United States Tax Consequences to
Non-United States Holders" and Items 14 and 15 of Part II of
the Registration Statement, insofar as such statements
constitute summaries of legal matters, documents or
proceedings referred to therein (other than numerical
computations as to which we express no opinion), conform in
all material respects to such legal matters, documents or
proceedings, as the case may be;
(x) no authorization, approval, consent or order of
any court or governmental body or agency is legally required
to be obtained by the Company for the issuance and sale by the
Company to the Underwriters of the Shares pursuant to this
Agreement except such as have been obtained under the Act and
the Regulations (except such as may be required under state
securities and Blue Sky laws or regulations or foreign laws or
regulations, as to which we express no opinion);
(xi) the execution, delivery and performance by the
Company of this Agreement and the sale by the Company to the
Underwriters of the Shares pursuant hereto does not (a)
violate the certificate of incorporation or by-laws of the
Company or any of the Subsidiaries or (b) violate any
statutes, rules or regulations of the State of New York, the
Federal laws of the United States or the General Corporation
Law of the State of Delaware which in our experience are
normally applicable to the transactions contemplated by the
Agreement (other than state securities or Blue Sky laws as to
which we express no opinion) (collectively, "Applicable Laws")
by which the Company or any of the Subsidiaries is bound or to
which any of their properties is subject, which violations,
individually or in the aggregate, would have a Material
Adverse Effect or (c) violate the terms of any agreement or
instrument filed as an exhibit to the Registration Statement
or any Exchange Act filing incorporated by reference in the
Registration Statement, which violations, individually or in
the aggregate, would have a Material Adverse Effect;
(xii) none of the Company or any of the Subsidiaries
is required to be registered as an "investment company" within
the meaning of the Investment Company Act of 1940, as amended;
(xiii) to the best of such counsel's knowledge, no
holder of any security of the Company has the right to require
registration of shares of
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Common Stock or any other securities of the Company under the
Registration Statement, except for such registration rights
that have been duly waived in writing;
(xiv) each document, if any, filed pursuant to the
Exchange Act and incorporated by reference in the Prospectus
(except for financial statements and other financial data
included therein as to which no opinion need be expressed)
complied when so filed as to form with the Exchange Act;
(xv) to the best of such counsel's knowledge, neither
the Company nor any of its subsidiaries has violated any
Environmental Laws, nor any provisions of the Employee
Retirement Income Security Act or the rules and regulations
promulgated thereunder, which in each case might result in any
material adverse change in the business, prospects, financial
condition or results of operation of the Company and its
subsidiaries, taken as a whole; and
(xvi) to the best of such counsel's knowledge, the
Company and each of the Subsidiaries have such Permits under
applicable Environmental Laws ("ENVIRONMENTAL PERMITS"), as
are necessary to own, lease and operate its respective
properties and to conduct its business in the manner described
in the Prospectus, except for such Environmental Permits, the
absence of which will not, individually or in the aggregate,
have a Material Adverse Effect. To the best of such counsel's
knowledge, the Company and each of the Subsidiaries have
fulfilled and performed all of their respective material
obligations with respect to such Environmental Permits and no
event has occurred which allows, or after notice or lapse of
time would allow, revocation or termination thereof, subject
in each case to such qualification as many be set forth in the
Prospectus, and except for such revocation or terminations, as
the case may be, as would not, individually or in the
aggregate, have a Material Adverse Effect.
In addition, such counsel shall state that such counsel has
participated in conferences with officers and other representatives of the
Company and its subsidiaries and discussions with auditors of the Company and
its subsidiaries in connection with the preparation of the Registration
Statement and the Prospectus and such counsel shall advise you that nothing has
come to the attention of such counsel that has led such counsel to believe that
the Registration Statement (including any 462(b) Registration Statement (if
any)), as amended or supplemented, at the time such Registration Statement, such
462(b) Registration Statement (if applicable) or any post-effective amendment
became effective, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, and that
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the Prospectus, as amended or supplemented, if applicable, contained an untrue
statement of a material fact or omitted to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
In giving such opinion with respect to the matters covered by
the immediately preceding paragraph, such counsel may state that their opinion
and belief are based upon their participation in the preparation of the
Registration Statement and Prospectus and any amendments or supplements thereto
and review and discussion of the contents thereof, but are without independent
check or verification except as required to give the opinions covered by clauses
(ii), (vii), (viii) and (ix) of paragraph (f) above. In addition, such counsel
may state that such counsel's opinion does not include or cover the financial
statements and notes thereto and related schedules and other financial,
numerical, statistical and accounting data contained in or omitted from the
Registration Statement.
The opinion of Xxxxxx, Xxxxx described in paragraph (f) above
shall be rendered to you at the request of the Company and shall so state
therein.
(g) You should have received on the Closing date an opinion
(satisfactory to you and counsel for the Underwriters), of Ray,
Xxxxxxx & Xxxxxxx, counsel for Twin Laboratories Inc. ("TWIN"), a
subsidiary of the Company, to the effect that:
(i) Twin has been duly incorporated, is validly
existing as a corporation in good standing under the laws of
the State of Utah and has the requisite corporate power and
corporate authority to own, lease and operate its properties
and to conduct its business as it is currently being conducted
and described in the Registration Statement; and
(ii) all of the outstanding shares of capital stock
of Twin have been duly authorized and validly issued, are
non-assessable, and to the knowledge of such counsel, are
fully paid.
(h) You shall have received on the Closing Date an opinion (in
a form reasonably satisfactory to you and your counsel), dated the
Closing Date, of Sidley & Austin, regulatory counsel for the Company,
to the effect that:
(i) to such counsel's knowledge, there are
no material legal proceedings by the U.S. Food and Drug
Administration ("FDA") or similar Federal or state regulatory
officials and bodies pending or threatened that relate to the
Company that are not described in the Prospectus;
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(ii) the Company has complied with all
applicable federal, Utah and New York food-and-drug-related
licenses, registrations, permits, and other approvals relating
to the manufacture, sale and distribution of its products;
and
(iii) the statements in the Prospectus under
the captions "Risk Factors -- Governmental Regulation", "--
California Proposition 65" and "--Certain Government Action
and Adverse Publicity Regarding Certain Products Containing
Ephedrine" and "Business -- Regulatory Matters" and "--Legal
Matters" that relate to matters of food and drug law insofar
as such statements constitute a summary of legal matters,
documents or proceedings referred to therein, are accurate in
all material respects and provide a fair summary of such
matters;
(iv) the Company has represented to such
counsel that it is in substantial compliance with applicable
decrees of the FDA, the Federal Trade Commission and other
state regulatory agencies and such counsel does not know of
any facts that contradict such representation; and
(v) the product labeling, advertising and
other promotional materials that the Company has submitted to
such counsel for re view, which to the knowledge of such
counsel relate to major products of the Company, do not give
rise to a substantial expectation that enforcement action
would be initiated against those products.
(i) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for the Underwriters), dated the
Closing Date, of legal counsel for each of the Selling Stockholders, to
the effect that:
(i) This Agreement has been duly authorized, executed
and delivered by or on behalf of such Selling Stockholder and
is a valid and binding agreement of such Selling Stockholder,
enforceable in accordance with its terms;
(ii) such Selling Stockholder has full legal right,
power and authority, and all authorization and approval
required by law, to enter into this Agreement and the Custody
Agreement and the Power of Attorney of such Selling
Stockholder and to sell, assign, transfer and deliver the
Shares to be sold by such Selling Stockholder in the manner
provided herein and therein;
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(iii) the Custody Agreement of such Selling
Stockholder has been duly authorized, executed and delivered
by such Selling Stockholder and is a valid and binding
agreement of such Selling Stockholder, enforceable in
accordance with its terms;
(iv) the Power of Attorney of such Selling
Stockholder has been duly authorized, executed and delivered
by such Selling Stockholder and is a valid and binding
instrument of such Selling Stockholder, enforceable in
accordance with its terms, and, pursuant to such Power of
Attorney, such Selling Stockholder has, among other things,
authorized the Attorneys, or any one of them, to execute and
deliver on such Selling Stockholder's behalf this Agreement
and any other document they, or any one of them, may deem
necessary or desirable in connection with the transactions
contemplated hereby and thereby and to deliver the Shares to
be sold by such Selling Stockholder pursuant to this
Agreement;
(v) upon delivery of and payment for the Shares to be
sold by each Selling Stockholder pursuant to this Agreement,
good and clear title to such Shares will pass to the
Underwriters, free of all restrictions on transfer, liens,
encumbrances, security interests, equities and claims
whatsoever; and
(vi) the execution, delivery and performance of this
Agreement and the Custody Agreement and Power of Attorney of
such Selling Stock holder by such Selling Stockholder, the
compliance by such Selling Stockholder with all the provisions
hereof and thereof and the consummation of the transactions
contemplated hereby and thereby will not (A) require any
consent, approval, authorization or other order of, or
qualification with, any court or governmental body or agency
(except such as may be required under the securities or Blue
Sky laws of the various states), (B) conflict with or
constitute a breach of any of the terms or provisions of, or
a default under, the organizational documents of such Selling
Stockholder, if such Selling Stockholder is not an individual,
or any indenture, loan agreement, mortgage, lease or other
agreement or instrument to which such Selling Stockholder is a
party or by which any property of such Selling Stockholder is
bound or (C) violate or conflict with any applicable law or
any rule, regulation, judgment, order or decree of any court
or any governmental body or agency having jurisdiction over
such Selling Stockholder or any property of such Selling
Stockholder.
The opinions described in paragraph (i) above shall be
rendered to you at the request of the Selling Stockholders and shall so state
therein.
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(j) You shall have received on the Closing Date an opinion,
dated the Closing Date, of, Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
counsel for the Underwriters, as to certain matters requested by you.
(k) You shall have received a letter on and as of the Closing
Date, in form and substance satisfactory to you, from Deloitte & Touche
LLP, independent public accountants, with respect to the financial
statements and certain financial information contained or incorporated
by reference in the Registration Statement and the Prospectus and
substantially in the form and substance of the letter delivered to you
by on the date of this Agreement.
(l) The Company shall not have failed at or prior to the
Closing Date to perform or comply in all material respects with any of
the agreements herein contained and required to be performed or
complied with by the Company at or prior to the Closing Date.
(m) The Shares shall have been duly listed, subject to notice
of issuance, on NASDAQ.
(n) The Company and the Selling Stockholders shall not have
failed on or prior to the Closing Date to perform or comply with any of
the agreements herein contained and required to be performed or
complied with by the Company or the Selling Stockholders, as the case
may be, on or prior to the Closing Date.
(o) You shall have received on the Closing Date, a certificate
of each Selling Stockholder who is not a U.S. Person (as defined under
applicable U.S. federal tax legislation) to the effect that such
Selling Stockholder is not a U.S. Person, which certificate may be in
the form of a properly completed and executed United States Treasury
Department Form W-8 (or other applicable form or statement specified by
Treasury Department regulations in lieu thereof).
The several obligations of the U.S. Underwriters to purchase any
Additional Shares hereunder are subject to the delivery to the U.S.
Representatives on the applicable Option Closing Date of such documents as they
may reasonably request with respect to the good standing of the Company, the due
authorization and issuance of such Additional Shares and other matters related
to the issuance of such Additional Shares.
10. Effectiveness of Agreement and Termination. This Agreement
shall become effective upon the later of (i) execution of this Agreement and
(ii) when notification of the effectiveness of the Registration Statement has
been released by the Commission.
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This Agreement may be terminated at any time on or prior to
the Closing Date by you by written notice to the Sellers if any of the following
has occurred: (i) since the respective dates as of which information is given in
the Registration Statement and the Prospectus, any Material Adverse Change or
development involving a prospective Material Adverse Change, whether or not
arising in the ordinary course of business, which would, in your judgment, make
it impracticable to market the Shares on the terms and in the manner
contemplated in the Prospectus, (ii) any outbreak or escalation of hostilities
or other national or international calamity or crisis or material adverse change
in the financial markets of the United States or elsewhere or any other
substantial national or international calamity or emergency if the effect of
such outbreak, escalation, calamity, crisis or emergency would, in your
judgment, make it impracticable to market the Shares on the terms and in the
manner contemplated in the Prospectus or to enforce contracts for the sale of
the Shares, (iii) any suspension or trading limitation of trading generally in
securities on the New York Stock Exchange, the American Stock Exchange, the
NASDAQ National Market System or in the over-the-counter markets or any setting
of minimum prices for trading on any such exchange or markets, (iv) the
enactment, publication, decree or other promulgation of any Federal or state
statute, regulation, rule or order of any court or other governmental authority
which would, in your judgment, have a Material Adverse Effect, (v) any
declaration of a general banking moratorium by either Federal or New York State
authorities, (vi) the taking of any action by any Federal, state or local
government or agency in respect of its monetary or fiscal affairs which in your
judgment has a material adverse effect on the financial markets in the United
States and would, in your judgment, make it impracticable or inadvisable to
market the Shares to enforce contracts for the sale of the Shares, or (vii) any
securities of the Company shall have been downgraded or placed on any "watch
list" for possible downgrading by any nationally recognized statistical rating
organization, provided, that in the case of such "watch list" placement,
termination shall be permitted only if such placement would, in the judgment of
any Underwriter, make it impracticable or inadvisable to market the Shares or to
enforce contracts for the sale of the Shares or materially impair the investment
quality of the Shares.
11. Default. If on the Closing Date or on an Option Closing
Date, as the case may be, any one or more of the Underwriters shall fail or
refuse to purchase the Firm Shares or Additional Shares, as the case may be,
which it has or they have agreed to purchase hereunder on such date and the
aggregate number of Firm Shares or Additional Shares, as the case may be, which
such defaulting Underwriter or Underwriters, as the case may be, agreed but
failed or refused to purchase is not more than one-tenth of the total number of
Shares to be purchased on such date by all Underwriters, each non-defaulting
Underwriter shall be obligated severally, in the proportion which the number of
Firm Shares set forth opposite its name in Schedule I bears to the total number
of Firm Shares which all the non-defaulting Underwriters, as the case may be,
have agreed to purchase, or in such other proportion as you may specify, to
purchase the Firm Shares or Additional Shares, as the case may be, which such
defaulting Underwriter or Underwrit-
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ers, as the case may be, agreed but failed or refused to purchase on such date;
provided that in no event shall the number of Firm Shares or Additional Shares,
as the case may be, which any Underwriter has agreed to purchase pursuant to
Section 2 hereof be increased pursuant to this Section 10 by an amount in excess
of one-ninth of such number of Firm Shares or Additional Shares, as the case may
be, without the written consent of such Underwriter. If on the Closing Date or
an Option Closing Date, as the case may be, any Underwriter or Underwriters
shall fail or refuse to purchase Firm Shares, or Additional Shares, as the case
may be, and the aggregate number of Firm Shares or Additional Shares, as the
case may be, with respect to which such default occurs is more than one-tenth of
the aggregate number of Shares to be purchased on such date by all Underwriters
and arrangements satisfactory to you and the Company for purchase of such Shares
are not made within 48 hours after such default, this Agreement will terminate
without liability on the part of any non-defaulting Underwriter, the Company or
the Selling Stockholders. In any such case which does not result in termination
of this Agreement, either you or the Company shall have the right to postpone
the Closing Date or the applicable Option Closing Date, as the case may be, but
in no event for longer than seven days, in order that the required changes, if
any, in the Registration Statement and the Prospectus or any other documents or
arrangements may be effected. If, on an Option Closing Date, any Under writer or
Underwriters shall fail or refuse to purchase Additional Shares and the aggre-
gate number of Additional Shares with respect to which such default occurs is
more than one-tenth of the aggregate number of Additional Shares to be purchased
on such date, the non-defaulting Underwriters shall have the option to (i)
terminate their obligation hereunder to purchase such Additional Shares or (ii)
purchase not less than the number of Additional Shares that such non-defaulting
Underwriters would have been obligated to purchase on such date in the absence
of such default. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any default of any such
Underwriter under this Agreement.
12. Agreements of the Selling Stockholders. Each Selling
Stockholder agrees with you and the Company:
(a) To pay or to cause to be paid all transfer taxes payable
in connection with the transfer of the Shares to be sold by such
Selling Stockholder to the Underwriters.
(b) To do and perform all things to be done and performed by
such Selling Stockholder under this Agreement prior to the Closing Date
and to satisfy all conditions precedent to the delivery of the Shares
to be sold by such Selling Stockholder pursuant to this Agreement.
13. Notice. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (a) if to the Company, to Twinlab
Corporation, 0000 Xxxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxx Xxxx 00000, Attention:
General Counsel, (b) if
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to any Underwriter or to you, to you c/o Bear, Xxxxxxx & Co. Inc., 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Syndicate Department, and in each
case, with a copy to each of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP at 000
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx X. Xxxxx, Esq. and to
Kramer, Levin, Naftalis & Xxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxxx X. Xxxxx, Esq., or in any case to such other address as the
person to be notified may have requested in writing.
14. Survival. The respective indemnities, contribution
agreements, representations, warranties and other statements of the Company, its
officers and directors, and the Selling Stockholders and of the several
Underwriters set forth in or made pursuant to this Agreement shall remain
operative and in full force and effect, and will survive delivery of and payment
for the Shares, regardless of (i) any investigation, or statement as to the
results thereof, made by or on behalf of any Underwriter, the officers or
directors of any Underwriter, any person controlling any Underwriter, the
Company, the officers or directors of the Company, any person controlling the
Company, any Selling Stockholder or any person controlling such Selling
Stockholder, (ii) acceptance of the Shares and payment for them hereunder and
(iii) termination of this Agreement
15. Expenses. If for any reason the Shares are not delivered
by or on behalf of any Seller as provided herein (other than as a result of any
termination of this Agreement pursuant to Section 10), the Sellers agree,
jointly and severally, to reimburse the several Underwriters for all
out-of-pocket expenses (including the fees and disbursements of counsel)
incurred by them. Notwithstanding any termination of this Agreement, the Company
shall be liable for all expenses which it has agreed to pay pursuant to Section
5(i) hereof. The Sellers also agree, jointly and severally, to reimburse the
several Underwriters, their directors and officers and any persons controlling
any of the Under writers for any and all fees and expenses (including, without
limitation, the fees disbursements of counsel) incurred by them in connection
with enforcing their rights hereunder (including, without limitation, pursuant
to Section 8 hereof).
16. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AS APPLIED TO
CONTRACTS MADE AND PER FORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW. THE COMPANY AND THE UNDER WRITERS EACH HEREBY
IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN
THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING
IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF ANY SUIT,
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, AND
IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDI-
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TIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. THE COMPANY AND THE
UNDERWRITERS EACH IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY
DO SO UNDER APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO
THE LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY
SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY
SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
17. Successors. Except as otherwise provided, this Agreement
has been and is made solely for the benefit of and shall be binding upon the
Company, the Selling Stockholders, the Underwriters, the Underwriters' directors
and officers, any controlling persons referred to herein, the Company's
directors and the Company's officers who sign the Registration Statement and
their respective successors and assigns, all as and to the extent provided in
this Agreement, and no other person shall acquire or have any right under or by
virtue of this Agreement. The term "successors and assigns" shall not include a
purchaser of any of the Shares from any of the several Underwriters merely
because of such purchase.
18. Counterparts. This Agreement may be signed in various
counterparts which together shall constitute one and the same instrument.
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Please confirm that the foregoing correctly sets forth the
agreement among the Company, the Selling Stockholders and the several
Underwriters.
Very truly yours,
TWINLAB CORPORATION
By:____________________________
Name:
Title:
THE SELLING STOCKHOLDERS NAMED IN
SCHEDULE III HERETO, ACTING
SEVERALLY
By:____________________________
Attorney-in-Fact
BEAR, XXXXXXX & CO. INC.
XXXXXXXXX, LUFKIN & XXXXXXXX SECURITIES CORPORATION
XXXXX, XXXXXXXX & XXXX, INC.
XXXXXX BROTHERS INC.
XXXXX XXXXXX INC.
Acting severally on behalf of themselves and the several
U.S. Underwriters named in Schedule I hereto
By: BEAR, XXXXXXX & CO. INC.
By:__________________________
Name:
Title:
BEAR, XXXXXXX INTERNATIONAL LIMITED
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES INTERNATIONAL
XXXXX, XXXXXXXX & XXXX, INC.
XXXXXX BROTHERS INTERNATIONAL
XXXXX XXXXXX INC.
Acting severally on behalf of themselves and the several
International Managers named in Schedule II hereto
By: BEAR, XXXXXXX INTERNATIONAL LIMITED
By:__________________________
Name:
Title:
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SCHEDULE I
Number of Firm
U.S. Underwriters Shares to be Purchased
----------------- ----------------------
Bear, Xxxxxxx & Co. Inc.
Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation
Xxxxx, Xxxxxxxx & Xxxx, Inc.
Xxxxxx Brothers Inc.
Xxxxx Xxxxxx Inc.
---------
Total 6,400,000
=========
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SCHEDULE II
Number of Firm
International Managers Shares to be Purchased
---------------------- ----------------------
Bear, Xxxxxxx International
Limited
Xxxxxxxxx, Lufkin & Xxxxxxxx
Securities International
Xxxxx, Xxxxxxxx & Xxxx, Inc.
Xxxxxx Brothers International
Xxxxx Xxxxxx Inc.
---------
Total 1,600,000
=========
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SCHEDULE III
Selling Stockholders
Number of Firm Number of
Name Shares Being Sold Additional Shares
---- ----------------- -----------------
Chase Equity Associates, L.P. 131,455 192,295
DLJ Investment Partners, L.P. 106,223 155,386
DLJ Investment Funding, Inc. 15,136 22,141
DLJ First ESC L.P. 10,096 14,768
PML Mezzanine Fund L.P. 131,455 192,295
Green Equity Investors II, L.P. 3,605,635 394,366
--------- -------
Total 4,000,000 971,251
========= =======
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Annex I
Xxxxx Xxxxxxxx
Xxxx Xxxxxxxx
Xxxx Xxxxxxxx
Xxxx Xxxxxxxx
Xxxxx Xxxxxxxx
Xxxxxxx Xxxxxxx
Xxxx X. Xxxxxxx
Xxxxxxxx Xxxxxx Xxxxxx
Xxxxxxxx X. Xxxxxxxx
Green Equity Investors II, L.P.
45
