1
Exhibit 1
Resource America, Inc.
_______________ shares of Common Stock
UNDERWRITING AGREEMENT
November __, 1996
UNDERWRITING AGREEMENT
November , 1996
FRIEDMAN, BILLINGS, ▇▇▇▇▇▇ & CO., INC.
as Representative of the several Underwriters
c/o Friedman, Billings, ▇▇▇▇▇▇ & Co., Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
Resource America, Inc., a Delaware corporation (the "Company"), confirms
its agreement with Friedman, Billings, ▇▇▇▇▇▇ & Co., Inc. and each of the other
Underwriters listed on Schedule I hereto (collectively, the "Underwriters"),
for whom Friedman, Billings, ▇▇▇▇▇▇ & Co., Inc. is acting as representative (in
such capacity, the "Representative"), with respect to (i) the sale by the
Company and the purchase by the Underwriters, acting severally and not jointly,
of the respective numbers of shares of Common Stock, par value $.01 per share,
of the Company ("Common Stock") set forth in Schedule I hereto and (ii) the
grant by the Company to the Underwriters, acting severally and not jointly, of
the option described in Section 1(b) hereof to purchase all or any part of
____________ additional shares of Common Stock to cover over-allotments, if
any. The __________ shares of Common Stock (the "Initial Shares") to be
purchased by the Underwriters and all or any part of the ________ shares of
Common Stock subject to the option described in Section 1(b) hereof (the
"Option Shares") are hereinafter called, collectively, the "Shares."
The Company understands that the Underwriters propose to offer publicly
the Shares as soon as the Underwriters deem advisable after this Agreement has
been executed and delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-_____) and a
related preliminary prospectus for the registration of the Shares under the
Securities Act of 1933, as amended (the "Securities Act"), and the rules and
regulations thereunder (the "Securities Act Regulations"). The Company has
prepared and filed such amendments thereto, if any, and such amended
preliminary prospectuses, if any, as may have been required to the date hereof,
and will file such additional amendments thereto and such amended prospectuses
as may hereafter be required. The registration statement has been declared
effective under the Securities Act by the Commission. The registration
statement as amended at the time it became effective (including all information
deemed to be a part of the registration statement at the time it became
effective pursuant to Rule 430A(b) of the Securities Act Regulations) is
hereinafter called the "Registration Statement," except that, if the Company
files a post-effective amendment to such registration statement which becomes
effective prior to the
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Closing Time (as defined below), the term "Registration Statement" shall refer
to such registration statement as so amended. Any registration statement filed
pursuant to Rule 462(b) of the Securities Act Regulations is hereinafter called
the "Rule 462(b) Registration Statement," and after such filing the term
"Registration Statement" shall include the 462(b) Registration Statement. Each
prospectus included in the registration statement, or amendments thereof,
before it became effective under the Securities Act and any prospectus filed
with the Commission by the Company with the consent of the Underwriters
pursuant to Rule 424(a) of the Securities Act Regulations is hereinafter called
the "Preliminary Prospectus." The term "Prospectus" means the final prospectus,
as first filed with the Commission pursuant to paragraph (1) or (4) of Rule
424(b) of the Securities Act Regulations. The Commission has not issued any
order preventing or suspending the use of any Preliminary Prospectus.
The Company and the Underwriters agree as follows:
1. SALE AND PURCHASE: (a) INITIAL SHARES. Upon the basis of the warranties
and representations and other terms and conditions herein set forth, the
Company agrees to sell to each Underwriter, severally and not jointly, and each
Underwriter agrees, severally and not jointly, to purchase from the Company, at
the purchase price per share of $_____, that number of Initial Shares set forth
in Schedule I opposite such Underwriter's name, plus any additional number of
Initial Shares which such Underwriter may become obligated to purchase pursuant
to the provisions of Section 8 hereof, subject in each case to such adjustments
among the Underwriters as the Representative in its sole discretion shall make
to eliminate any sales or purchases of fractional shares. The Underwriters may
from time to time increase or decrease the public offering price after the
initial public offering to such extent as the Underwriters may determine.
(b) OPTION SHARES. In addition, upon the basis of the warranties and
representations and other terms and conditions herein set forth, the Company
hereby grants an option to the Underwriters, severally and not jointly, to
purchase from the Company up to ______ Option Shares at the purchase price per
share set forth in paragraph (a) above, plus any additional number of Option
Shares which such Underwriter may become obligated to purchase pursuant to the
provisions of Section 8 hereof. The option hereby granted will expire 30 days
after the date hereof and may be exercised in whole or in part from time to
time only for the purpose of covering over-allotments which may be made in
connection with the offering and distribution of the Initial Shares upon notice
by the Representative to the Company setting forth the number of Option Shares
as to which the several Underwriters are then exercising the option and the
time and date of payment and delivery for such Option Shares. Any such time and
date of delivery (a "Date of Delivery") shall be determined by the
Representative, but shall not be later than seven full business days after the
exercise of said option, nor in any event prior to the Closing Time, as
hereinafter defined. If the option
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is exercised as to all or any portion of the Option Shares, each of the
Underwriters, acting severally and not jointly, will purchase that proportion
of the total number of Option Shares then being purchased which the number of
Initial Shares set forth in Schedule I opposite the name of such Underwriter
bears to the total number of Initial Shares, subject in each case to such
adjustments as the Representative in its discretion shall make to eliminate any
sales or purchases of fractional shares. The Underwriters may from time to time
increase or decrease the public offering price after the initial public
offering to such extent as the Underwriters may determine.
2. PAYMENT AND DELIVERY: (a) INITIAL SHARES. Payment of the purchase price
for the Initial Shares shall be made to the Company by wire transfer or
certified or official bank check payable in federal (same-day) funds at the
office of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇ (unless another place shall be agreed upon by the Representative and the
Company), against delivery of the certificates for the Initial Shares to the
Representative for the respective accounts of the Underwriters. Such payment
and delivery shall be made at 10:00 a.m., New York City time, on the third
(fourth, if pricing occurs after 4:30 p.m. (New York City time)) business day
after the date hereof (unless another time, not later than ten business days
after such date, shall be agreed to by the Representative and the Company). The
time at which such payment and delivery are actually made is hereinafter
sometimes called the "Closing Time." Certificates for the Initial Shares shall
be delivered to the Representative in definitive form registered in such names
and in such denominations as the Representative shall specify. For the purpose
of expediting the checking of the certificates for the Initial Shares by the
Representative, the Company agrees to make such certificates available to the
Representative for such purpose at least one full business day preceding the
Closing Time.
(b) OPTION SHARES. In addition, payment of the purchase price for the
Option Shares shall be made to the Company by wire transfer or certified or
official bank check payable in federal (same-day) funds at the office of
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
(unless another place shall be agreed upon by the Representative and the
Company), against delivery of the certificates for the Option Shares to the
Representative for the respective accounts of the Underwriters. Such payment
and delivery shall be made at 10:00 a.m., New York City time, on each Date of
Delivery. Certificates for the Option Shares shall be delivered to the
Representative in definitive form registered in such names and in such
denominations as the Representative shall specify. For the purpose of
expediting the checking of the certificates for the Option Shares by the
Representative, the Company agrees to make such certificates available to the
Representative for such purpose at least one full business day preceding the
relevant Date of Delivery.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY: The Company represents
and warrants to the Underwriters that:
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(a) each of the Registration Statement and any Rule 462(b)
Registration Statement has become effective under the Securities Act and
no stop order suspending the effectiveness of the Registration Statement
or any Rule 462(b) Registration Statement has been issued under the
Securities Act and no proceeding for that purpose has been instituted or
is pending or, to the knowledge of the Company, is contemplated by the
Commission, and any request on the part of the Commission for additional
information has been complied with;
(b) the Registration Statement complies and the Prospectus and any
further amendments or supplements thereto will, when they become effective
or are filed with the Commission, as the case may be, comply in all
material respects with the requirements of the Securities Act and the
Securities Act Regulations; the Registration Statement did not, and any
amendment thereto will not, in each case as of the applicable effective
date, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and the Prospectus and any amendment or
supplement thereto will not, as of the applicable filing date and at
Closing Time and on each Date of Delivery (if any), contain an untrue
statement of a material fact or omit 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; PROVIDED, HOWEVER, that the
Company makes no warranty or representation with respect to any statement
contained in the Registration Statement or the Prospectus in reliance upon
and in conformity with information concerning the Underwriters and
furnished in writing through the Representative by or on behalf of any
Underwriter to the Company expressly for use in the Registration Statement
or the Prospectus;
(c) the Prospectus delivered to the Underwriters for use in
connection with this offering was identical to the electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇,
except to the extent permitted by Regulation S-T;
(d) the Company had at the date indicated the duly authorized and
outstanding capitalization set forth in the Prospectus under the caption
"Capitalization"; all of the issued and outstanding shares of capital
stock of the Company have been duly and validly authorized and issued and
are fully paid and non-assessable; the Company is duly incorporated and
validly existing under the laws of the State of Delaware, with full power
and authority to own its properties and conduct its business as described
in the Registration Statement and the Prospectus, and to execute and
deliver this Agreement; and all of the issued shares of capital stock of
each subsidiary of the Company (collectively, the "Subsidiaries") have
been duly and validly authorized and
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issued and are fully paid and non-assessable and are owned directly or
indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims;
(e) the unissued shares of Common Stock to be issued and sold by the
Company to the Underwriters hereunder have been duly and validly
authorized and, when issued and delivered against payment therefor as
provided herein, will be duly and validly issued, fully paid and
non-assessable;
(f) each Subsidiary has been duly incorporated or established and is
validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation; the Company and each Subsidiary is duly
qualified or licensed to do business and in good standing as a foreign
corporation in each jurisdiction in which they conduct their respective
businesses and in which the failure, individually or in the aggregate, to
be so qualified or licensed could have a material adverse effect on the
business, properties, prospects, results of operations or condition
(financial or otherwise) of the Company and its Subsidiaries taken as a
whole; the Company and each of its Subsidiaries is in compliance in all
material respects with the laws, orders, rules, regulations and directives
issued or administered by such jurisdictions;
(g) neither the Company nor any of its Subsidiaries is in breach of,
or in default under (nor has any event occurred which with notice, lapse
of time, or both would constitute a breach of, or default under), its
certificate of incorporation or charter or by-laws or in the performance
or observance of any obligation, agreement, covenant or condition
contained in any license, indenture, mortgage, deed of trust, bank loan or
credit agreement or other agreement or instrument to which the Company or
any of its Subsidiaries is a party or by which any of them is bound,
except for such breaches or defaults which would not have a material
adverse effect on the business, properties, prospects, results of
operations or condition (financial or otherwise) of the Company and its
Subsidiaries taken as a whole, and the execution, delivery and performance
of this Agreement and consummation of the transactions contemplated hereby
will not conflict with, or result in any breach of or constitute a default
under (nor constitute any event which with notice, lapse of time, or both
would constitute a breach of, or default under), (i) any provision of the
certificate of incorporation or charter or by-laws of the Company or any
of its Subsidiaries or (ii) any provision of any license, indenture,
mortgage, deed of trust, bank loan or credit agreement or other agreement
or instrument to which the Company or any of its Subsidiaries is a party
or by which any of them or their respective properties may be bound or
affected or (iii) any federal, state, local or foreign law, regulation or
rule or any decree, judgment or order applicable to the Company or any of
its Subsidiaries, except in the case of clause (ii) for such breaches or
defaults which would not have a material adverse effect on the business,
properties, prospects, results of operations
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or condition (financial or otherwise) of the Company and its Subsidiaries
taken as a whole;
(h) this Agreement has been duly authorized, executed and delivered
by the Company and is a legal, valid and binding agreement of the Company
enforceable in accordance with its terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally, and by general principles of
equity, and except to the extent that the indemnification provisions of
Section 9 hereof may be limited by federal or state securities laws and
public policy considerations in respect thereof;
(i) the Shares conform in all material respects to the description
thereof contained in the Registration Statement and Prospectus;
(j) except as described in the Prospectus, the Company has not sold
or issued any shares of Common Stock during the six-month period preceding
the date of the Prospectus, including any sales pursuant to Rule 144A
under, or Regulations D or S of, the Securities Act;
(k) no approval, authorization, consent or order of or filing with
any federal, state or local governmental or regulatory commission, board,
body, authority or agency is required in connection with the sale of the
Shares as contemplated hereby other than (i) such as have been obtained,
or will have been obtained at the Closing Time or the relevant Date of
Delivery, as the case may be, under the Securities Act, (ii) such
approvals as have been obtained in connection with the approval of the
quotation of the Shares on the Nasdaq National Market System and (iii) any
necessary qualification under the securities or blue sky laws of the
various jurisdictions in which the Shares are being offered by the
Underwriters;
(l) ▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP, whose reports on the consolidated financial
statements of the Company and its Subsidiaries are filed with the
Commission as part of the Registration Statement and Prospectus, are
independent public accountants as required by the Securities Act and the
Securities Act Regulations;
(m) each of the Company and its Subsidiaries has all necessary
licenses, authorizations, consents and approvals and has made all
necessary filings required under any federal, state or local law,
regulation or rule, and has obtained all necessary authorizations,
consents and approvals from other persons, required in order to conduct
its respective business, except to the extent that any failure to have any
such licenses, authorizations, consents or approvals, to make any such
filings or to obtain any such authorizations, consents or approvals would
not, alone or in the
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aggregate, have a material adverse effect on the business, properties,
prospects, results of operations or condition (financial or otherwise) of
the Company and its Subsidiaries taken as a whole; neither the Company nor
any of its Subsidiaries is in violation of, or in default under, any such
license, authorization, consent or approval or any federal, state, local
or foreign law, regulation or rule or any decree, order or judgment
applicable to the Company or any of its Subsidiaries the effect of which
could have a material adverse effect on the business, properties,
prospects, results of operations or condition (financial or otherwise) of
the Company and its Subsidiaries taken as a whole;
(n) all legal or governmental proceedings, contracts or documents 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 have
been so described or filed as required;
(o) there are no actions, suits or proceedings pending or, to the
Company's knowledge, threatened against the Company or any of its
Subsidiaries or any of their respective properties, at law or in equity,
or before or by any federal, state, local or foreign governmental or
regulatory commission, board, body, authority or agency which could result
in a judgment, decree or order having a material adverse effect on the
business, properties, prospects, results of operations or condition
(financial or otherwise) of the Company and its Subsidiaries taken as a
whole;
(p) the financial statements, including the notes thereto, included
in the Registration Statement and the Prospectus present fairly the
consolidated financial position of the Company and its Subsidiaries as of
the dates indicated and the consolidated results of operations and changes
in financial position and cash flow of the Company and its Subsidiaries
for the periods specified; such financial statements have been prepared in
conformity with generally accepted accounting principles applied on a
consistent basis during the periods involved (except as indicated in the
notes thereto);
(q) subsequent to the effective date of the Registration Statement
and the date of the Prospectus or the date of the latest audited financial
statements included in the Prospectus, and except as may be otherwise
stated in the Registration Statement or Prospectus, there has not been (i)
any material and unfavorable change, financial or otherwise, in the
business, properties, prospects, results of operations or condition
(financial or otherwise) of the Company and its Subsidiaries taken as a
whole, (ii) any transaction, other than in the ordinary course of
business, which is material to the business, properties, prospects,
results of operations or condition (financial or otherwise) of the Company
and its Subsidiaries taken as a whole, contemplated or
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entered into by the Company or any of its Subsidiaries or (iii) any
obligation, contingent or otherwise, directly or indirectly incurred by
the Company or any of its Subsidiaries, other than in the ordinary course
of business, which is material to the business, properties, prospects,
results of operations or condition (financial or otherwise) of the Company
and its Subsidiaries taken as a whole;
(r) the Company and each of its Subsidiaries have good and
marketable title in fee simple to all real property and good and
marketable title to all personal property owned by them, in each case free
and clear of all liens, encumbrances and defects except such as are
described in the Prospectus or such as do not materially affect the value
of such property and do not materially interfere with the use made and
proposed to be made of such property by the Company and its Subsidiaries;
and all real property and buildings held under lease by the Company and
its Subsidiaries are held by them under valid, subsisting and enforceable
leases, with such exceptions as are not material and do not interfere with
the use made and proposed to be made of such property and buildings by the
Company and its Subsidiaries;
(s) no relationship, direct or indirect, exists between or among the
Company on the one hand, and the directors, officers, stockholders,
customers or suppliers of the Company on the other hand, which is required
to be described in the Prospectus which is not so described;
(t) the Company 1. makes and keeps accurate books and records and 2.
maintains internal accounting controls which provide reasonable assurance
that (A) transactions are executed in accordance with management's
authorization, (B) transactions are recorded as necessary to permit
preparation of its financial statements and to maintain accountability for
its assets, (C) access to its assets is permitted only in accordance with
management's authorization and (D) the reported accountability for its
assets is compared with existing assets at reasonable intervals;
(u) there has been no storage, disposal, generation, manufacture,
refinement, transportation, handling or treatment of toxic wastes, medical
wastes, hazardous wastes or hazardous substances by the Company or any of
its Subsidiaries (or, to the knowledge of the Company, any of their
predecessors in interest) at, upon or from any of the properties now or
previously owned or leased by the Company or its Subsidiaries in violation
of any applicable law, ordinance, rule, regulation, order, judgment,
decree or permit or which would require remedial action under any
applicable law, ordinance, rule, regulation, order, judgment, decree or
permit, except for any violation or remedial action which would not have,
or could not be reasonably likely to have, alone or in the aggregate with
all such violations and remedial actions, a material adverse effect on the
business, properties, prospects, results of operations
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or condition (financial or otherwise) of the Company and its Subsidiaries
taken as a whole; there has been no material spill, discharge, leak,
emission, injection, escape, dumping or release of any kind onto such
property or into the environment surrounding such property of any toxic
wastes, medical wastes, solid wastes, hazardous wastes or hazardous
substances due to or caused by the Company or any of its Subsidiaries or
with respect to which the Company or any of its Subsidiaries have
knowledge, except for any such spill, discharge, leak, emission,
injection, escape, dumping or release which would not have or would not be
reasonably likely to have, alone or in the aggregate with all such spills,
discharges, leaks, emissions, injections, escapes, dumpings and releases,
a material adverse effect on the business, properties, prospects, results
of operations or condition (financial or otherwise) of the Company and its
Subsidiaries taken as a whole; and the terms "hazardous wastes", "toxic
wastes", "hazardous substances" and "medical wastes" shall have the
meanings specified in any applicable local, state, federal and foreign
laws or regulations with respect to environmental protection;
(v) the Company has complied with, and is and will be in compliance
with, the provisions of that certain Florida act relating to disclosure of
doing business with Cuba, codified as Section 517.075 of the Florida
statutes, and the rules and regulations thereunder (collectively, the
"Cuba Act") or is exempt therefrom;
(w) the Company is not, and upon the sale of the Shares as herein
contemplated will not be, an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in the
Investment Company Act of 1940, as amended (the "Investment Company Act");
(x) other than the holders of the Warrants issued to PICO (as
defined in the Prospectus) (the "Warrants"), copies of which have been
filed as exhibits to the Registration Statement, there are no persons with
registration or other similar rights to have any securities registered
pursuant to the Registration Statement or otherwise registered by the
Company under the Securities Act ("Registration Rights") and each Warrant
holder has waived its Registration Rights in connection with the sale of
the Shares as herein contemplated; and
(y) any certificate signed by any officer of the Company or any of
its Subsidiaries delivered to the Representative or to counsel for the
Underwriters pursuant to or in connection with this Agreement shall be
deemed a representation and warranty by the Company to each Underwriter as
to the matters covered thereby.
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4. CERTAIN COVENANTS OF THE COMPANY: The Company hereby agrees with each
Underwriter:
(a) to furnish such information as may be required and otherwise to
cooperate in qualifying the Shares for offering and sale under the
securities or blue sky laws of such states as the Representative may
designate and to maintain such qualifications in effect as long as
required for the distribution of the Shares, provided that the Company
shall not be required to qualify as a foreign corporation or to consent to
the service of process under the laws of any such state (except service of
process with respect to the offering and sale of the Shares);
(b) to prepare the Prospectus in a form approved by the Underwriters
and file such Prospectus with the Commission pursuant to Rule 424(b) not
later than 10:00 a.m. (New York City time) on the day following the
execution and delivery of this Agreement and to furnish promptly (and with
respect to the initial delivery of such Prospectus, not later than 10:00
a.m. (New York City time) on the day following the execution and delivery
of this Agreement) to the Underwriters as many copies of the Prospectus
(or of the Prospectus as amended or supplemented if the Company shall have
made any amendments or supplements thereto after the effective date of the
Registration Statement) as the Underwriters may reasonably request for the
purposes contemplated by the Securities Act Regulations, which Prospectus
and any amendments or supplements thereto furnished to the Underwriters
will be identical to the electronically transmitted copies thereof filed
with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by
Regulation S-T;
(c) to advise the Representative promptly and (if requested by the
Representative) to confirm such advice in writing, when any post-effective
amendment to the Registration Statement becomes effective under the
Securities Act Regulations;
(d) to advise the Representative promptly, confirming such advice in
writing, of (i) any request by the Commission for amendments or
supplements to the Registration Statement or Prospectus or for additional
information with respect thereto, or (ii) the issuance by the Commission
of any stop order suspending the effectiveness of the Registration
Statement or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus, or of the suspension of the
qualification of the Shares for offering or sale in any jurisdiction, or
of the initiation or threatening of any proceedings for any of such
purposes and, if the Commission or any other government agency or
authority should issue any such order, to make every reasonable effort to
obtain the lifting or removal of such order as soon as possible; to advise
the Representative promptly of any proposal to amend or supplement the
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Registration Statement or Prospectus and to file no such amendment or
supplement to which the Representative shall reasonably object in writing;
(e) to furnish to the Underwriters for a period of five years from
the date of this Agreement (i) copies of all annual, quarterly and current
reports supplied to holders of shares of Common Stock, (ii) copies of all
reports filed by the Company with the Commission and (iii) such other
information as the Underwriters may reasonably request regarding the
Company or its Subsidiaries;
(f) to advise the Underwriters promptly of the happening of any
event known to the Company within the time during which a Prospectus
relating to the Shares is required to be delivered under the Securities
Act Regulations which, in the judgment of the Company, would require the
making of any change in the Prospectus then being used so that the
Prospectus would 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 light of the circumstances under which
they are made, not misleading, and, during such time, to prepare and
furnish, at the Company's expense, to the Underwriters promptly such
amendments or supplements to such Prospectus as may be necessary to
reflect any such change and to furnish to the Underwriters a copy of such
proposed amendment or supplement before filing any such amendment or
supplement with the Commission;
(g) to furnish promptly to the Representative a signed copy of the
Registration Statement, as initially filed with the Commission, and of all
amendments thereto (including all exhibits thereto) and such number of
conformed copies of the foregoing as the Underwriters may reasonably
request;
(h) to pay all expenses, fees and taxes (other than any transfer
taxes and the fees and disbursements of counsel for the Underwriters
except as set forth under Section 5 hereof and clauses (iii) and (iv)
below) in connection with (i) the preparation and filing of the
Registration Statement, each Preliminary Prospectus, the Prospectus, and
any amendments or supplements thereto, and the printing and furnishing of
copies of each thereof to the Underwriters and to dealers (including costs
of mailing and shipment), (ii) the preparation, issuance and delivery of
the certificates for the Shares to the Underwriters, including any stock
or other transfer taxes or duties payable upon the sale of the Shares to
the Underwriters, (iii) the word processing and/or printing of this
Agreement and any dealer agreements, and the reproduction and/or printing
and furnishing of copies of each thereof to the Underwriters and to
dealers (including costs of mailing and shipment), (iv) the qualification
of the Shares for offering and sale under state laws and the determination
of their eligibility for investment under state law as aforesaid
(including the legal fees
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and filing fees and other disbursements of counsel for the Underwriters)
and the printing and furnishing of copies of any blue sky surveys or legal
investment surveys to the Underwriters and to dealers, (v) any filing for
review of the public offering of the Shares by the NASD, (vi) the fees and
expenses of any transfer agent or registrar for the Shares, (vii) the fees
and expenses incurred in connection with the inclusion of the Shares in
the Nasdaq National Market and (viii) the performance of the Company's
other obligations hereunder;
(i) to furnish to the Underwriters, not less than two business days
before filing with the Commission subsequent to the effective date of the
Prospectus and during the period referred to in paragraph (e) above, a
copy of any document proposed to be filed with the Commission pursuant to
Section 13, 14, or 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act");
(j) to make generally available to its security holders as soon as
practicable after the effective date of the Registration Statement an
earning statement (in form, at the option of the Company, complying with
the provisions of Rule 158 under the Securities Act) covering a period of
12 months beginning after the effective date of the Registration
Statement;
(k) prior to filing with the Commission any reports on Form SR
pursuant to Rule 463 of the Securities Act Regulations, to furnish a copy
thereof to the counsel for the Underwriters and receive and consider its
comments thereon, and to deliver promptly to the Representative a signed
copy of each report on Form SR filed by it with the Commission;
(l) to apply the net proceeds from the sale of the Shares being
sold by the Company as set forth in the Prospectus;
(m) to use its best efforts to effect and maintain the quotation of
the Shares on the Nasdaq National Market and to file with the Nasdaq
National Market all documents and notices required by the Nasdaq National
Market of companies that have securities that are traded in the
over-the-counter market and quotations for which are reported by the
Nasdaq National Market; and
(n) to refrain during a period of 120 days from the date of the
Prospectus, without the prior written consent of the Representative, from
(i) offering, pledging, selling, contracting to sell, selling any option,
warrant or contract to purchase, purchasing any option, warrant or
contract to sell, granting any option for the sale of, or otherwise
disposing of or transferring, directly or indirectly, any share of Common
Stock or any securities convertible into or exercisable or exchangeable
for Common
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Stock, or filing any registration statement under the Securities Act with
respect to any of the foregoing or (ii) entering into any swap or any
other agreement or any transaction that transfers, in whole or in part,
directly or indirectly, the economic consequence of ownership of the
Common Stock or any security convertible into or exchangeable for Common
Stock, whether any such swap or transaction described in clause (i) or
(ii) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. The Company also agrees to cause each
officer and director of the Company (including ▇▇▇▇▇▇ ▇. ▇▇▇▇▇) and PICO
(as defined in the prospectus) to furnish to the Representative on or
prior to the date hereof a letter or letters, in form and substance
satisfactory to counsel for the Representative, pursuant to which each
such person or entity shall agree to abide by the aforementioned
restrictions, unless they have received prior written consent from the
Representative, for a period of: in the case of (i) the Company's officers
and directors ___ days from the date of the Prospectus (ii) ▇▇▇▇▇▇ ▇.
▇▇▇▇▇ ___ days from the date of the Prospectus and (iii) PICO the earlier
of (a) one year from the date hereof or (b) six months after the date of
the exercise of its warrants. The foregoing sentence shall not apply to
(A) the Shares to be sold hereunder or (B) any shares of Common Stock
issued by the Company upon the exercise of an option or Warrant
outstanding on the date hereof and referred to in the Prospectus.
5. REIMBURSEMENT OF THE UNDERWRITERS' EXPENSES: If the Shares are not
delivered for any reason other than the termination of this Agreement pursuant
to the first two paragraphs of Section 7 hereof or the default by one or more
of the Underwriters in its or their respective obligations hereunder, the
Company shall reimburse the Underwriters for all of their reasonable
out-of-pocket expenses relating to the transactions contemplated hereby,
including the fees and disbursements of their counsel.
6. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS: The obligations of the
Underwriters hereunder are subject to the accuracy of the representations and
warranties on the part of the Company on the date hereof and at the Closing
Time and on each Date of Delivery, the performance by the Company of its
obligations hereunder and to the following conditions:
(a) the Company shall furnish to the Underwriters at the Closing
Time and on each Date of Delivery an opinion of the Ledgewood Law Firm
P.C., counsel for the Company, addressed to the Underwriters and dated the
Closing Time and each Date of Delivery and in form satisfactory to ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Underwriters, stating that:
(i) The Company and each of its subsidiaries have been duly
incorporated and are validly existing as corporations in good
standing under
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14
the laws of their respective jurisdictions of incorporation, are
duly qualified or licensed to do business and are in good standing
as foreign corporations in each jurisdiction in which the conduct of
their respective businesses requires such qualification;
(ii) this Agreement has been duly authorized, executed and
delivered by the Company;
(iii) the Company has an authorized capitalization as set
forth in the Prospectus, and all of the issued shares of capital
stock of the Company (including the shares of Stock being delivered
pursuant hereto) have been duly and validly authorized and issued,
are fully paid and non-assessable and conform to the description
thereof contained in the Prospectus; and all of the issued shares of
capital stock of each subsidiary of the Company have been duly and
validly authorized and issued and are fully paid, non-assessable and
are owned directly or indirectly by the Company, free and clear of
all liens, encumbrances, equities or claims;
(iv) the Shares conform in all material respects to the
descriptions thereof contained in the Registration Statement and
Prospectus and have been duly authorized by the Company and are
validly issued, fully paid and nonassessable;
(v) the statements under the captions "Business -- Regulation"
and "Description of Capital Stock" in the Registration Statement and
the Prospectus, insofar as such statements constitute a summary of
the legal matters referred to therein, constitute accurate summaries
thereof in all material respects;
(vi) as of the effective date of the Registration Statement,
the Registration Statement and the Prospectus (except as to the
financial statements and other financial and statistical data
contained therein, as to which such counsel need express no opinion)
complied as to form in all material respects with the requirements
of the Securities Act and the Securities Act Regulations;
(vii) the Registration Statement has become effective under
the Securities Act as of the date and time specified in such
opinion, the Rule 462(b) Registration Statement, if any, was filed
with the Commission on the date specified therein, the Prospectus
was filed with the Commission pursuant to the subparagraph of Rule
424(b) of the Rules and Regulations specified in such opinion on the
date specified therein and no stop order suspending the
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effectiveness of the Registration Statement has been issued and, to
the best of such counsel's knowledge, no proceedings with respect
thereto have been commenced or threatened;
(viii) the issue and sale of the Shares by the Company and the
execution, delivery and performance of this Agreement by the Company
and the consummation by the Company of the transactions contemplated
hereby do not and will not conflict with, or result in any breach
of, or constitute a default under (nor constitute any event which
with notice, lapse of time, or both would constitute a breach of or
default under), (A) any provisions of the certificate of
incorporation, charter or by-laws of the Company or any of its
Subsidiaries, (B) any provision of any license, indenture, mortgage,
deed of trust, bank loan, credit agreement or other agreement or
instrument known to such counsel to which the Company or any
Subsidiary is a party or by which any of them or their respective
properties may be bound or affected, or (C) any statute or any
order, rule or regulation known to such counsel of any court or
governmental agency or body having jurisdiction over the Company or
any of its Subsidiaries or any of their properties or assets, except
in the case of clause (B) for such conflicts, breaches or defaults
which individually or in the aggregate would not have a material
adverse effect on the business, properties, prospects, results of
operations or condition (financial or otherwise) of the Company and
its Subsidiaries taken as a whole; and, except for the registration
of the Shares under the Securities Act and such consents, approvals,
authorizations, registrations or qualifications as may be required
under the Exchange Act and applicable state securities laws in
connection with the purchase and distribution of the Shares by the
Underwriters, no consent, approval, authorization or order of, or
filing or registration with, any such court or governmental agency
or body is required for the execution, delivery and performance of
this Agreement by the Company and the consummation of the
transactions contemplated hereby;
(ix) there are no contracts, licenses, agreements, leases or
documents of a character which are required to be filed as exhibits
to the Registration Statement or to be summarized or described in
the Prospectus which have not been so filed, summarized or
described;
(x) there are no actions, suits or proceedings pending or
threatened against the Company or any of its Subsidiaries or any of
their respective properties, at law or in equity or before or by any
commission, board, body, authority or agency which are required to
be described in the Prospectus but are not so described;
-15-
16
(xi) the Company and each of its Subsidiaries have good and
marketable title in fee simple to all real property owned by them,
in each case free and clear of all liens, encumbrances and defects
except such as are described in the Prospectus or such as do not
materially affect the value of such property and do not materially
interfere with the use made and proposed to be made of such property
by the Company and its Subsidiaries; and all real property and
buildings held under lease by the Company and its Subsidiaries are
held by them under valid, subsisting and enforceable leases, with
such exceptions as are not material and do not interfere with the
use made and proposed to be made of such property and buildings by
the Company and its Subsidiaries;
(xii) the sale of the Shares by the Company is not subject to
preemptive or other similar rights arising by operation of law,
under the certificate of incorporation or by-laws of the Company,
under any agreement known to such counsel to which the Company or
any of its Subsidiaries is a party or otherwise;
(xiii) the form of certificate used to evidence the Common Stock
complies in all material respects with all applicable statutory
requirements, with any applicable requirements of the certificate of
incorporation and by-laws of the Company and the requirements of the
Nasdaq National Market;
(xiv) other than the holders of the Warrants, there are no
persons with registration or other similar rights to have any
securities registered pursuant to the Registration Statement or
otherwise registered by the Company under the Securities Act; and
(xv) the Company is not an "investment company" or an
entity "controlled" by an "investment company," as such terms are
defined in the Investment Company Act.
In addition, such counsel shall state that they have participated in
conferences with officers and other representatives of the Company,
representatives of the independent public accountants of the Company and
representatives of the Underwriters at which the contents of the
Registration Statement and Prospectus were discussed and, although such
counsel is not passing upon and does not assume responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or Prospectus (except as and to the extent stated
in subparagraphs (iv) and (v) above), on the basis of the foregoing
nothing has come to the attention of such counsel that causes them to
believe that either the Registration
-16-
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Statement or any amendment thereto at the time such Registration Statement
or 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 or that the
Prospectus contains any untrue statement of a material fact or omits to
state any material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading (it being understood that, in each case, such counsel need
express no view with respect to the financial statements and other
financial and statistical data included in the Registration Statement or
Prospectus).
(b) The Representative shall have received from ▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP,
letters dated, respectively, as of the date of this Agreement, the Closing
Time and each Date of Delivery, as the case may be, and addressed to the
Representative as representative of the Underwriters in the forms
heretofore approved by the Underwriters.
(c) The Underwriters shall have received at the Closing Time and on
each Date of Delivery the favorable opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇,
counsel for the Underwriters, dated the Closing Time or such Date of
Delivery, in form and substance satisfactory to the Underwriters.
(d) No amendment or supplement to the Registration Statement or
Prospectus shall have been filed to which the Underwriters shall have
objected in writing.
(e) Prior to the Closing Time and each Date of Delivery (i) no stop
order suspending the effectiveness of the Registration Statement or any
order preventing or suspending the use of any Preliminary Prospectus or
Prospectus shall have been issued by the Commission, and no suspension of
the qualification of the Shares for offering or sale in any jurisdiction,
or of the initiation or threatening of any proceedings for any of such
purposes, shall have occurred; and (ii) the Registration Statement and all
amendments thereto, or modifications thereof, if any, and the Prospectus
and all amendments or supplements thereto, or modifications thereof, if
any, shall not contain an untrue statement of 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
are made, not misleading.
(f) Between the time of execution of this Agreement and the Closing
Time or the relevant Date of Delivery (i) no material adverse change in
the business, properties, prospects, results of operations or condition
(financial or otherwise) of the Company and its Subsidiaries taken as a
whole shall have occurred or become known and (ii) no transaction which is
material and unfavorable to the Company shall have been entered into by
the Company or any of its Subsidiaries.
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(g) The Company will, at the Closing Time and on each Date of
Delivery, deliver to the Underwriters a certificate of ▇▇. ▇▇▇▇▇▇ ▇.
▇▇▇▇▇, Chairman of the Board of Directors, Chief Executive Officer,
President and Director and ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President Finance, to
the effect that, to each of such officer's best knowledge, the
representations and warranties of the Company set forth in this Agreement
and the conditions set forth in paragraph (e) and paragraph (f) have been
met and are true and correct as of such date.
(h) At the Closing Time, the Shares shall have been approved for
inclusion in the Nasdaq National Market.
(i) The NASD shall not have raised any objection with respect to the
fairness and reasonableness of the underwriting terms and arrangements.
(j) The Representative shall have received evidence reasonably
satisfactory to it that (i) the holders of the Warrants shall have waived
the Registration Rights granted to them thereunder in connection with the
offering of the Shares and (ii) the officers and directors of the Company
(including ▇▇▇▇▇▇ ▇. ▇▇▇▇▇) and PICO (as defined in the Prospectus) shall
have agreed to refrain during certain periods (as described below),
without the prior written consent of the Representative, from (A)
offering, pledging, selling, contracting to sell, selling any option,
warrant or contract to purchase, purchasing any option, warrant or
contract to sell, granting any option for the sale of, or otherwise
disposing of or transferring, directly or indirectly, any share of Common
Stock or any securities convertible into or exercisable or exchangeable
for Common Stock, or requesting that the Company file a registration
statement under the Securities Act with respect to any of the foregoing or
(B) entering into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the economic
consequence of ownership of the Common Stock or any security convertible
into or exercisable or exchangeable for Common Stock, whether any such
swap or transaction described in clause (A) or (B) above is to be settled
by delivery of Common Stock or such other securities, in cash or
otherwise. The aforementioned restrictions shall apply to the officers
and directors of the Company for a period of ___ days from the date of the
Prospectus; to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ for a period of ___ days from the date of
the Prospectus; and to PICO (as defined in the Prospectus) for a period
ending on the earlier of (i) one year from the date hereof or (ii) six
months after the date of the exercise of its Warrants.
(k) The Company shall have furnished to the Underwriters such other
documents and certificates as to the accuracy and completeness of any
statement in the Registration Statement and the Prospectus or any
amendment or supplement thereto as
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of the Closing Time or any Date of Delivery as the Underwriters may
reasonably request.
(l) The Company shall have performed such obligations under this
Agreement as are to be performed by the terms hereof at or before the
Closing Time or the relevant Date of Delivery.
7. TERMINATION: The obligations of the several Underwriters hereunder
shall be subject to termination in the absolute discretion of the
Representative, at any time prior to the Closing Time or any Date of Delivery,
if trading in securities on the New York Stock Exchange or the Nasdaq National
Market shall have been suspended or minimum prices shall have been established
on the New York Stock Exchange or the Nasdaq National Market, or if a banking
moratorium shall have been declared either by the United States or New York
State authorities, or if the United States shall have declared war in
accordance with its constitutional processes or there shall have occurred any
material outbreak or escalation of hostilities or other national or
international calamity or crisis of such magnitude in its effect on the
financial markets of the United States as, in the judgment of the
Representative, to make it impracticable to market the Shares.
If the Representative elects to terminate this Agreement as provided in
this Section 7, the Company and the Underwriters shall be notified promptly by
letter or telecopy.
If the sale to the Underwriters of the Shares, as contemplated by this
Agreement, is not carried out by the Underwriters for any reason permitted
under this Agreement or if such sale is not carried out because the Company
shall be unable to comply with any of the terms of this Agreement, the Company
shall not be under any obligation or liability under this Agreement (except to
the extent provided in Sections 4(h), 5 and 9 hereof) and the Underwriters
shall be under no obligation or liability to the Company under this Agreement
(except to the extent provided in Section 9 hereof) or to one another
hereunder.
8. INCREASE IN UNDERWRITERS' COMMITMENTS: If any Underwriter shall default
at Closing Time or on a Date of Delivery in its obligation to take up and pay
for the Shares to be purchased by it under this Agreement on such date and if
the total number of Shares which such Underwriter shall have agreed but failed
to take up and pay for does not exceed 10% of the total number of Shares to be
purchased on such date, each non-defaulting Underwriter shall take up and pay
for (in addition to the number of Shares which it is obligated to purchase on
such date pursuant to this Agreement) the portion of the total number of Shares
agreed to be purchased by the defaulting Underwriter on such date in the
proportion that its underwriting obligations hereunder bears to the
underwriting obligations of all non-defaulting Underwriters.
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Without relieving any defaulting Underwriter from its obligations
hereunder, the Company agrees with the non-defaulting Underwriters that it will
not sell any Shares hereunder on such date unless all of the Shares to be
purchased on such date are purchased on such date by the Underwriters (or by
substituted Underwriters selected by the Representative with the approval of
the Company or selected by the Company with the approval of the
Representative).
If a new Underwriter or Underwriters are substituted for a defaulting
Underwriter in accordance with the foregoing provision, the Company or the
non-defaulting Underwriters shall have the right to postpone the Closing Time
or the relevant Date of Delivery for a period not exceeding five business days
in order that any necessary changes in the Registration Statement and
Prospectus and other documents may be effected.
The term Underwriter as used in this Agreement shall refer to and include
any Underwriter substituted under this Section 8 with the like effect as if
such substituted Underwriter had originally been named in this Agreement.
9. INDEMNITY BY THE COMPANY AND THE UNDERWRITERS:
(a) The Company agrees to indemnify, defend and hold harmless each
Underwriter, and any person who controls any Underwriter within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act, from and
against any loss, expense, liability or claim (including the reasonable cost of
investigation) which, jointly or severally, any such Underwriter or controlling
person may incur under the Securities Act, the Exchange Act or otherwise,
insofar as such loss, expense, liability or claim arises out of or is based
upon any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement (or in the Registration Statement as
amended by any post-effective amendment thereof by the Company) or in a
Prospectus (the term Prospectus for the purpose of this Section 9 being deemed
to include any Preliminary Prospectus, the Prospectus and the Prospectus as
amended or supplemented by the Company), or arises out of or is based upon any
omission or alleged omission to state a material fact required to be stated in
either such Registration Statement or Prospectus or necessary to make the
statements made therein not misleading, except insofar as any such loss,
expense, liability or claim arises out of, or is based upon, any untrue
statement or alleged untrue statement or omission or alleged omission contained
in the Registration Statement or the Prospectus in reliance upon and in
conformity with information concerning the Underwriters and furnished to the
Company in writing through the Representative by or on behalf of any
Underwriter to the Company expressly for use in the Registration Statement or
the Prospectus.
If any action is brought against an Underwriter or controlling person in
respect of which indemnity may be sought against the Company pursuant to the
immediately preceding
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paragraph, such Underwriter shall promptly notify the Company in writing of the
institution of such action and the indemnifying party shall assume the defense
of such action, including the employment of counsel and payment of expenses.
Such Underwriter or controlling person shall have the right to employ its or
their own counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of such Underwriter or such controlling person unless
the employment of such counsel shall have been authorized in writing by the
Company in connection with the defense of such action or the Company shall not
have employed counsel to have charge of the defense of such action within a
reasonable time or such indemnified party or parties shall have reasonably
concluded (based on the advice of counsel) that there may be defenses available
to it or them which are different from or additional to those available to the
Company (in which case the Company shall not have the right to direct the
defense of such action on behalf of the indemnified party or parties), in any
of which events such fees and expenses shall be borne by the Company and paid
as incurred (it being understood, however, that the Company shall not be liable
for the expenses of more than one separate counsel for the Underwriters or
controlling persons in any one action or series of related actions in the same
jurisdiction representing the indemnified parties who are parties to such
action). Anything in this paragraph to the contrary notwithstanding, the
Company shall not be liable for any settlement of any such claim or action
effected without the Company's written consent.
(b) Each Underwriter agrees, severally and not jointly, to indemnify,
defend and hold harmless the Company, its directors and officers and any person
who controls the Company within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act from and against any loss, expense, liability
or claim (including the reasonable cost of investigation) which, jointly or
severally, the Company or any such person may incur under the Securities Act,
the Exchange Act or otherwise, insofar as such loss, expense, liability or
claim arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission contained in the Registration
Statement or the Prospectus (or in the Registration Statement as amended by any
post-effective amendment thereof by the Company) in reliance upon and in
conformity with information concerning the Underwriters and furnished to the
Company in writing through the Representative by or on behalf of any
Underwriter to the Company expressly for use in the Registration Statement or
the Prospectus.
If any action is brought against the Company or any such person in respect
of which indemnity may be sought against any Underwriter pursuant to the
foregoing paragraph, the Company or such person shall promptly notify the
Representative in writing of the institution of such action and the
Representative, on behalf of the Underwriters, shall assume the defense of such
action, including the employment of counsel and payment of expenses. The
Company or such person shall have the right to employ its own counsel in any
such case, but the fees and expenses of such counsel shall be at the expense of
the Company or such person
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unless the employment of such counsel shall have been authorized in writing by
the Representative in connection with the defense of such action or the
Representative shall not have employed counsel to have charge of the defense of
such action within a reasonable time or such indemnified party or parties shall
have reasonably concluded (based on the advice of counsel) that there may be
defenses available to it or them which are different from or additional to
those available to the Underwriters (in which case the Representative shall not
have the right to direct the defense of such action on behalf of the
indemnified party or parties), in any of which events such fees and expenses
shall be borne by such Underwriter and paid as incurred (it being understood,
however, that the Underwriters shall not be liable for the expenses of more
than one separate counsel in any one action or series of related actions in the
same jurisdiction representing the indemnified parties who are parties to such
action). Anything in this paragraph to the contrary notwithstanding, no
Underwriter shall be liable for any settlement of any such claim or action
effected without the written consent of such Underwriter.
(c) If the indemnification provided for in this Section 9 is unavailable
to an indemnified party under subsections (a) and (b) of this Section 9 in
respect of any losses, expenses, liabilities or claims referred to therein,
then each applicable 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, expenses, liabilities or claims
(i) in such proportion as is appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriters on the other hand
from the offering of the Shares or (ii) if the allocation provided by clause
(i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and of the
Underwriters on the other in connection with the statements or omissions which
resulted in such losses, expenses, liabilities or claims, as well as any other
relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriters on the other shall be deemed to be
in the same proportion as the total proceeds from the offering (net of
underwriting discounts and commissions but before deducting expenses) received
by the Company bear to the underwriting discounts and commissions received by
the Underwriters. The relative fault of the Company on the one hand and of the
Underwriters on the other shall be determined by reference to, among other
things, whether the untrue statement or alleged untrue statement of a material
fact or omission or alleged omission relates to information supplied by the
Company or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The amount paid or payable by a party as a result of the losses,
claims, damages and liabilities referred to above shall be deemed to include
any legal or other fees or expenses reasonably incurred by such party in
connection with investigating or defending any claim or action.
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(d) The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of
the equitable considerations referred to in subsection (c) above.
Notwithstanding the provisions of this Section 9, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities 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 9 are several in proportion to their respective
underwriting commitments and not joint.
(e) The indemnity and contribution agreements contained in this Section 9
and the covenants, warranties and representations of the Company contained in
this Agreement shall remain in full force and effect regardless of any
investigation made by or on behalf of any Underwriter, or any person who
controls any Underwriter within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act, or by or on behalf of the Company, its
directors and officers or any person who controls the Company within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act
and shall survive any termination of this Agreement or the sale and delivery of
the Shares. The Company and each Underwriter agree promptly to notify the
others of the commencement of any litigation or proceeding against it and, in
the case of the Company, against any of the Company's officers and directors,
in connection with the sale and delivery of the Shares, or in connection with
the Registration Statement or Prospectus.
10. NOTICES: Except as otherwise herein provided, all statements,
requests, notices and agreements shall be in writing or by telecopy and, if to
the Underwriters, shall be sufficient in all respects if delivered to Friedman,
Billings, ▇▇▇▇▇▇ & Co., Inc., ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: Compliance Department; if to the Company, shall be sufficient
in all respects if delivered to the Company at the offices of the Company at
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
11. GOVERNING LAW; HEADINGS: THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES. The section headings in this Agreement
have been inserted as a matter of convenience of reference and are not a part
of this Agreement.
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12. PARTIES AT INTEREST: The Agreement herein set forth has been and is
made solely for the benefit of the Underwriters and the Company and the
controlling persons, directors and officers referred to in Section 9 hereof,
and their respective successors, assigns, executors and administrators. No
other person, partnership, association or corporation (including a purchaser,
as such purchaser, from any of the Underwriters) shall acquire or have any
right under or by virtue of this Agreement.
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13. COUNTERPARTS: This Agreement may be signed by the parties in
counterparts which together shall constitute one and the same agreement among
the parties.
If the foregoing correctly sets forth the understanding among the Company
and the Underwriters, please so indicate in the space provided below for the
purpose, whereupon this letter shall constitute a binding agreement among the
Company and the Underwriters.
Very truly yours,
RESOURCE AMERICA, INC.
By
--------------------------------------------
Title:
Accepted and agreed to as
of the date first above
written:
FRIEDMAN, BILLINGS, ▇▇▇▇▇▇ & CO., INC.
By
------------------------------------
Title:
For themselves and as Representative
of the other Underwriters named on
Schedule I hereto.
Schedule I
Number of
Underwriter Shares
--------------------------------------------------------- ---------
Friedman, Billings, ▇▇▇▇▇▇ & Co., Inc. . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . .
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