4,000,000 Shares
▇▇▇▇'▇ CORPORATION
Common Stock
(par value $.01 per share)
FORM OF
UNDERWRITING AGREEMENT
August [ ], 1997
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
▇▇▇▇▇▇▇▇▇▇ Securities
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Company, L.L.C.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated
c/o Morgan ▇▇▇▇▇▇▇ & Co.
Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
▇▇▇▇'▇ Corporation, a Wisconsin corporation (the "Company"), proposes
to issue and sell to the several Underwriters named in Schedule I hereto (the
"Underwriters"), and certain shareholders of the Company (the "Selling
Shareholders") named in Schedule II hereto severally propose to sell to the
several Underwriters, an aggregate of 4 million shares of the Common Shares (par
value per share $.01), of the Company (the "Firm Shares") of which 3.3 million
shares are to be issued and sold by the Company (the "Company Firm Shares") and
700,000 shares are to be sold by the Selling Shareholders, each Selling
Shareholder selling the amount set forth opposite such Selling Shareholder's
name in Schedule II hereto. The Company and the Selling Shareholders are
hereinafter collectively referred to as the "Sellers".
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ &
▇▇▇▇▇ Incorporated, ▇▇▇▇▇▇▇▇▇▇ Securities, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Company, L.L.C. and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated, shall act as representatives (the
"Representatives") of the several Underwriters.
The Company also proposes to issue and sell to the several
Underwriters not more than an additional 600,000 shares of Common Shares (par
value $.01 per share) of the Company (the "Additional Shares"; and, together
with the Company Firm Shares, the "Company Shares"), if and to the extent that
the Representatives shall have determined to exercise, on behalf of the
Underwriters, the right to purchase such shares of Common Stock granted to the
Underwriters in Article III hereof. The Firm Shares and the Additional Shares
are hereinafter collectively referred to as the "Shares". The Common Shares (par
value $.01 per share) of the Company are hereinafter referred to as the "Common
Stock".
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The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement relating to the Shares. The registration
statement as amended at the time it becomes effective, and including all
documents incorporated by reference therein, the exhibits thereto and the
information (if any) deemed to be part of the registration statement at the time
of effectiveness pursuant to Rule 430A under the Securities Act of 1933, as
amended (the "Securities Act"), is hereinafter referred to as the "Registration
Statement"; the prospectus in the form first used to confirm sales of Shares,
including all documents incorporated by reference therein, is hereinafter
collectively referred to as the "Prospectus". The terms "supplement",
"amendment" and "amend" as used herein shall include all documents deemed to be
incorporated by reference in the Prospectus that are filed subsequent to the
date of the Prospectus by the Company with the Commission pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
I.
The Company represents and warrants to each of the Selling
Shareholders and each of the Underwriters that:
(a) The Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in effect,
and no proceedings for such purpose are pending before, and the Company
does not know of any such proceedings that are 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
and the applicable rules and regulations of the Commission thereunder, (ii)
each part of the Registration Statement, when such part became effective,
did not contain and each such part, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, (iii) the Registration
Statement and the Prospectus comply and, as amended or supplemented, if
applicable, will comply in all material respects with the Securities Act
and the applicable rules and regulations of the Commission thereunder and
(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) do not apply to statements or omissions in the Registration Statement
or the Prospectus based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through the
Representatives expressly for use therein.
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(c) The Company is validly existing as a corporation in good standing
under the laws of the State of Wisconsin, has the corporate power and
authority to own its property and to conduct its business as described in
the Prospectus and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would not
have a material adverse effect on the Company and its subsidiaries, taken
as a whole.
(d) Kohl's Department Stores, Inc. and Kohl's Investment Corp. are
the only "significant subsidiaries" of the Company (as such term is defined
under Regulation S-X) and each is validly existing as a corporation in good
standing under the laws of the State of Delaware, has the corporate power
and authority to own its property and to conduct its business as described
in the Prospectus and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would not
have a material adverse effect on the Company and its subsidiaries, taken
as a whole.
(e) The authorized capital stock of the Company conforms as to legal
matters to the description thereof contained in the Prospectus.
(f) All the outstanding shares of Common Stock (including the Shares
to be sold by the Selling Shareholders) have been duly authorized and are
validly issued, fully paid and, subject to Wisconsin Business Corporation
Law (S) 180.0622(2)(b), nonassessable.
(g) The Company Shares have been duly authorized and, when issued and
delivered in accordance with the terms of this Agreement, will be validly
issued, fully paid and, subject to Wisconsin Business Corporation Law
(S) 180.0622(2)(b), nonassessable.
(h) This Agreement and each of the Power of Attorney and Custody
Agreement (each, a "Power of Attorney and Custody Agreement" and
collectively, the "Power of Attorney and Custody Agreements"), dated as of
the date hereof, between each Selling Shareholder and the Company, as
Custodian (the "Custodian"), relating to the deposit of the Shares to be
sold by such Selling Shareholder and appointing certain individuals as such
Selling Shareholder's attorneys-in-fact to the extent set forth therein,
relating to the transactions contemplated hereby and by the Registration
Statement, have been duly authorized, executed and delivered by the
Company.
(i) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, this Agreement, the Power of
Attorney and
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Custody Agreements and the issuance and delivery of the Company Shares will
not contravene any provision of applicable federal or state law or the
articles of incorporation or by-laws of the Company or any agreement or
other instrument binding upon the Company or any of its subsidiaries that
is material to the Company and its subsidiaries, taken as a whole, or any
judgment, order or decree of any federal or state governmental body, agency
or court having jurisdiction over the Company or any subsidiary, and no
consent, approval, authorization or order of or qualification with any
federal or state governmental body or agency is required for the
performance by the Company of its obligations under this Agreement, except
such as may be required by the securities or Blue Sky laws of the various
states in connection with the offer and sale of the Shares.
(j) There has not occurred any material adverse change, or any
development involving a prospective material adverse change in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a whole, from that
set forth in the Prospectus.
(k) There are no legal or governmental proceedings pending, and the
Company does not know of any proceedings that are threatened, to which the
Company or any of its subsidiaries is a party or to which any of the
properties of the Company or any of its subsidiaries is subject that are
required to be described in the Registration Statement or the Prospectus
and are not so described or any statutes, regulations, material contracts
or other documents that are required to be described in the Registration
Statement or the Prospectus or to be filed or incorporated by reference as
exhibits to the Registration Statement that are not described, filed as
required or incorporated.
(l) Each of the Company and its subsidiaries has all necessary
consents, authorizations, approvals, orders, certificates and permits of
and from, and has made all declarations and filings with, all federal,
state, local and other governmental, administrative or regulatory
authorities, all self-regulatory organizations and all courts and other
tribunals, to own, lease, license and use its properties and assets and to
conduct its business in the manner described in the Prospectus, except to
the extent that the failure to obtain or file would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole.
(m) Each preliminary prospectus filed as part of the Registration
Statement as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the Securities Act, complied when so filed in
all material respects with the Securities Act and the rules and regulations
of the Commission thereunder.
(n) 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 of 1940, as amended.
(o) The Shares are listed on the New York Stock Exchange.
(p) The Company and its subsidiaries (i) are in compliance with any and all
applicable foreign, federal, state and local laws and regulations relating to
the protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants ("Environmental Laws"), (ii)
have received all permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective businesses and (iii)
are in compliance with all terms and conditions of any such permit, license or
approval, except where such noncompliance with Environmental Laws, failure to
receive required permits, licenses or other approvals or failure to comply with
the terms and conditions of such permits, licenses or approvals would not,
singly or in the aggregate, have a material adverse effect on the Company and
its subsidiaries, taken as a whole.
(q) The Company has complied with all provisions of Section 517.075,
Florida Statutes (Chapter 92-198, Laws of Florida).
(r) The Company has not taken and will not take, directly or indirectly,
any action designed to, or that might be reasonably expected to, cause or result
in stabilization or manipulation of the price of the Common Stock (provided that
the Company does not make any representation as to any actions that may be taken
by any Underwriter); and the Company has not distributed and will not distribute
any prospectus or other offering material in connection with the offering and
sale of the Shares other than any preliminary prospectus filed with the
Commission or the Prospectus or other material permitted by the Securities Act.
II.
Each of the Selling Shareholders represents and warrants to each of the
Underwriters and the Company that:
(a) This Agreement has been duly authorized, executed and delivered
by or on behalf of such Selling Shareholder.
(b) The execution and delivery by such Selling Shareholder of, and the
performance by such Selling Shareholder of its obligations under, this
Agreement and the Power of Attorney and Custody Agreement, will not
contravene any provision of applicable federal or state law or any
agreement or other instrument binding upon such Selling Shareholder or any
judgment, order or decree of any federal or state governmental body, agency
or court having jurisdiction over such Selling Shareholder, and no consent,
approval, authorization or order of or qualification with any federal or
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state governmental body or agency is required for the performance by such
Selling Shareholder of its obligations under this Agreement or the Power of
Attorney and Custody Agreement of such Selling Shareholder, except such as
may be required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Shares.
(c) Such Selling Shareholder has, and on the Closing Date (as defined
below) will have, valid and marketable title to the Shares to be sold by
such Selling Shareholder and the legal right and power and all
authorization and approval to enter into this Agreement and the Power of
Attorney and Custody Agreement, and to sell, transfer and deliver the
Shares to be sold by such Selling Shareholder.
(d) The Power of Attorney and Custody Agreement has been duly
authorized, executed and delivered by such Selling Shareholder and is a
valid and binding agreement of such Selling Shareholder.
(e) Delivery of the Shares to be sold by such Selling Shareholder
pursuant to this Agreement will pass marketable title to such Shares free
and clear of any security interests, claims, liens, equities and other
encumbrances.
(f) All information furnished by or on behalf of such Selling
Shareholder expressly for use in the Registration Statement and Prospectus
does not, and on the Closing Date will not, contain any untrue statement of
a material fact or omit to state any material fact necessary to make such
information not misleading.
(g) Such Selling Shareholder has not taken and will not take,
directly or indirectly, any action designed to, or that might be reasonably
expected to, cause or result in stabilization or manipulation of the price
of the Common Stock (provided that such Selling Shareholder does not make
any representation as to any actions that may be taken by any Underwriter);
and such Selling Shareholder has not distributed and will not distribute
any prospectus or other offering material in connection with the offering
and sale of the Shares other than any preliminary prospectus filed with the
Commission or the Prospectus or other material permitted by the Securities
Act.
III.
The Company and each Selling Shareholder, severally and not jointly,
hereby agree to sell to the several Underwriters, and each Underwriter, upon the
basis of the representations and warranties of the Company, with respect to Firm
Shares sold by it, and of the Selling Shareholders, with respect to Firm Shares
sold by them, herein contained, but subject to the conditions hereinafter
stated, agrees severally and not jointly, to purchase from
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the Sellers at $[ ] a share -- the purchase price -- the number of Firm
Shares (subject to such adjustments to eliminate fractional shares as the
Representatives may determine) (x) in the case of the Company, that bears the
same proportion to the number of Firm Shares to be sold by the Company as the
number of Firm Shares set forth in Schedule I hereto opposite the name of such
Underwriter bears to the total number of Firm Shares and (y) in the case of the
Selling Shareholders, that bears the same proportion to the number of Firm
Shares to be sold by such Selling Shareholders as the number of Firm Shares set
forth in Schedule I hereto opposite the name of such Underwriter bears to the
total number of Firm Shares.
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees, to sell
to the Underwriters the Additional Shares, and the Underwriters shall have a
one-time right to purchase, severally and not jointly, up to 600,000 Additional
Shares at the purchase price. Additional Shares may be purchased as provided in
Article V hereof solely for the purpose of covering over-allotments made in
connection with the offering of the Firm Shares. If any Additional Shares are to
be purchased, each Underwriter agrees, severally and not jointly, to purchase
the number of Additional Shares (subject to such adjustments to eliminate
fractional shares as the Representatives may determine) that bears the same
proportion to the total number of Additional Shares to be purchased as the
number of Firm Shares set forth in Schedule I hereto opposite the name of such
Underwriter bears to the total number of Firm Shares.
Each Seller hereby agrees that without the prior written consent of
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated ("▇▇▇▇▇▇ ▇▇▇▇▇▇▇"), it will not, for a period
of 90 days after the date of the Prospectus, (i) offer, pledge, sell, contract
to sell, sell any option or contract to purchase, purchase any option or
contract to sell, grant any option, right or warrant to purchase, lend or
otherwise transfer or dispose of, directly or indirectly, any shares of Common
Stock or any securities convertible into or exercisable or exchangeable for
Common Stock, other than any shares of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock and issued
pursuant to employee benefit or employee stock option or ownership plans of the
Company which are in existence on the date of this Agreement, or (ii) enter into
any swap or other arrangement that transfers to another, in whole or in part,
any of the economic consequences of ownership of such shares of Common Stock,
whether any such 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, other than (a) the sale of the Shares to the Underwriters pursuant to
this Agreement or (b) transactions relating to shares of Common Stock or other
securities acquired in open market transactions after completion of the public
offering.
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In addition, each Selling Shareholder agrees that, without the prior
written consent of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ on behalf of the Underwriters, it will not,
for a period of 90 days after the date of the Prospectus, make any demand for or
exercise any right with respect to, the registration of any shares of Common
Stock or any security convertible into or exercisable or exchangeable for Common
Stock.
IV.
The Company and the Selling Shareholders are advised by you that the
Underwriters propose to make a public offering of their respective portions of
the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable. The Company and the Selling
Shareholders are further advised by you that the Shares are to be offered to the
public initially at $[ ] a Share (the public offering price) and to certain
dealers selected by you at a price that represents a concession not in excess of
$[ ] a share under the public offering price, and that any Underwriter may
allow, and such dealers may reallow, a concession, not in excess of $[ ] a
share, to any Underwriter or to certain other dealers.
V.
Payment for the Firm Shares to be sold by the Company and each Selling
Shareholder shall be made by wire transfers payable to the order of the Company
and the Custodian (or to the Company's registrar at the Custodian's direction),
as the case may be, in federal funds or other funds immediately available in New
York City at the office of Shearman & Sterling, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇, at 10:00 A.M., local time, on September 25, 1997, or at such other
time on the same or such other date, not later than October 2, 1997, as shall be
agreed to by you, the Company and the Selling Shareholders. The time and date
of each such payment are hereinafter referred to as the "Closing Date".
Payment for any Additional Shares shall be made by wire transfers
payable to the order of the Company and the Custodian (or to the Company's
registrar at the Custodian's direction), as the case may be, in federal funds or
other funds immediately available in New York City at the office of Shearman &
Sterling, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, at 10:00 A.M., local time,
on such date (which may be the same as the Closing Date but shall in no event be
earlier than the Closing Date nor later than five business days after the giving
of the notice hereinafter referred to) as shall be designated in a written
notice from the Representatives to the Company of your determination, on behalf
of the Underwriters, to purchase a number, specified in said notice, of
Additional Shares, or on such other date, in any event not later than
[ ], 1997, as shall be agreed to by the
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Representatives and the Company. The time and date of such payment are
hereinafter referred to as the "Option Closing Date". The notice of the
determination to exercise the option to purchase Additional Shares and of the
Option Closing Date may be given at any time within 30 days after the date of
this Agreement. The Underwriters represent that the Additional Shares will be
used only to cover over-allotments made in connection with the offering of the
Firm Shares.
Certificates for the Firm Shares and Additional Shares shall be in
definitive form and registered in such names and in such denominations as you
shall request in writing not later than two full business days prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to you on
the Closing Date or the Option Closing Date, as the case may be, for the
respective accounts of the several Underwriters, with any transfer taxes payable
in connection with the transfer of the Shares to the Underwriters duly paid,
against payment of the purchase price therefor.
VI.
The obligations of the Company and each Selling Shareholder and the
several obligations of the Underwriters hereunder are subject to the condition
that the Registration Statement shall have become effective not later than the
date hereof.
The several obligations of the Underwriters hereunder are subject to
the following further conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading or
of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded any of the
Company's securities by any "nationally recognized statistical rating
organization" as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act, and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations, of
the Company and its subsidiaries, taken as a whole, from that set
forth in the Registration Statement, that, in your judgment, is
material and adverse and makes it, in your judgment,
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impracticable to market the Shares on the terms and in the manner
contemplated in this Prospectus.
(b) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of the
Company, to the effect set forth in clause (a)(i) above and to the effect that
the representations and warranties of the Company contained in this Agreement
are true and correct as of the Closing Date and that the Company has complied
with all of the agreements and satisfied all of the conditions on its part to
be performed or satisfied hereunder on or before the Closing Date.
The officer signing and delivering such certificate may rely upon the
best of his knowledge as to proceedings threatened.
(c) You shall have received on the Closing Date an opinion of ▇▇▇▇▇▇▇
& ▇▇▇▇, S.C., counsel for the Company, dated the Closing Date, to the effect
that:
(i) the Company is validly existing as a corporation in good
standing under the laws of the State of Wisconsin, has the corporate
power and authority to own its property and to conduct its business as
described in the Prospectus and, to such counsel's knowledge, is duly
qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing would not
have a material adverse effect on the Company and its subsidiaries
taken as a whole;
(ii) each of Kohl's Department Stores, Inc. and Kohl's
Investment Corp. is validly existing as a corporation in good standing
under the laws of the State of Delaware, has the corporate power and
authority to own its property and to conduct its business as described
in the Prospectus, to such counsel's knowledge, and is duly qualified
to transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries taken as a
whole;
(iii) the authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the Prospectus;
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(iv) all the outstanding shares of Common Stock (including the
Shares to be sold by the Selling Shareholders) have been duly
authorized and are validly issued, fully paid and, subject to
Wisconsin Business Corporation Law (S) 180.0622(2)(b), nonassessable.
(v) the Company Shares have been duly authorized and, when
issued and delivered in accordance with the terms of this Agreement,
will be validly issued, fully paid and, subject to Wisconsin Business
Corporation Law (S) 180.0622(2)(b), nonassessable.
(vi) this Agreement and each of the Power of Attorney and
Custody Agreements and the issuance and delivery of the Company Shares
have been duly authorized, executed and delivered by the Company;
(vii) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement,
the Power of Attorney and Custody Agreements and the issuance and
delivery of the Company Shares will not contravene any provision of
applicable law or the certificate of incorporation or by-laws of the
Company or, to the best of such counsel's knowledge, any agreement or
other instrument binding upon the Company or any of its subsidiaries
which has been identified to such counsel by the Company as one of
such instruments that is material to the Company and its subsidiaries,
taken as a whole, or, to the best of such counsel's knowledge, without
independent investigation other than inquiries of responsible officers
of the Company, any judgment, order or decree of any governmental
body, agency or court having jurisdiction over the Company or any
subsidiary, and no consent, approval, authorization or order of or
qualification with any federal or State of Wisconsin governmental body
or agency is required for the performance by the Company of its
obligations under this Agreement, except such as may be required by
the securities or Blue Sky laws in connection with the offer and sale
of the Shares by the Underwriters;
(viii) the statements (1) in the Prospectus under the caption
"Description of Capital Stock" and (2) in the Registration Statement
under Item 15 thereof, (3) to such counsel's knowledge, after due
inquiry of responsible officers of the Company, in "Item 3 -- Legal
Proceedings" of the Company's most recent annual report on Form 10-K
incorporated by reference in the Prospectus, (4) to such counsel's
knowledge, after due inquiry of responsible officers of the Company,
under the caption "Executive Compensation--Employment Agreements" and
"--Other Agreements" in the Company's Proxy Statement for its Annual
Meeting of Stockholders
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immediately succeeding the filing of the Company's last annual report,
and (5) to such counsel's knowledge, after due inquiry of responsible
officers of the Company, in "Item 1 -- Legal Proceedings" of Part II
of the Company's quarterly reports on Form 10-Q, if any, filed since
such annual report, in each case insofar as such statements constitute
summaries of the legal matters, documents or proceedings referred to
therein, fairly present the information called for with respect to
such legal matters, documents and proceedings and fairly summarize the
matters referred to therein;
(ix) after due inquiry, without independent investigation other
than inquiries of responsible officers of the Company, such counsel
does not know of any legal or governmental proceeding pending or
threatened to which the Company or any of its subsidiaries is a party
or to which any of the properties of the Company or any of its
subsidiaries is subject that are required to be described in the
Registration Statement or the Prospectus and are not so described or
of any statutes, regulations, material contracts or other documents
that are required to be described in the Registration Statement or the
Prospectus or to be filed or incorporated by reference as exhibits to
the Registration Statement that are not described, filed or
incorporated as required;
(x) 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 of 1940, as amended;
(xi) (1) each document filed pursuant to the Exchange Act and
incorporated by reference in the Prospectus complied when so filed as
to form in all material respects with the Exchange Act and the
applicable rules and regulations of the Commission thereunder and (2)
the Registration Statement, as of its effective date, and the
Prospectus, as of its date and as of the Closing Date, appeared on
their face to be appropriately responsive in all material respects to
the requirements of the Securities Act and the rules and regulations
of the Commission thereunder, except that, in each case, such counsel
need not express any opinion as to the financial statements, schedules
and other financial data included in or excluded from such documents
filed pursuant to the Exchange Act or the Registration Statement and
such counsel need not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in such documents
filed pursuant to the Exchange Act or in the Registration Statement
and the Prospectus (other than as specified in subparagraph (viii)
above insofar as the captions referred to therein relate to provisions
of documents and other legal matters); and
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(xii) in addition, such opinion shall state that such counsel
has participated in conferences with officers and other
representatives of the Company, representatives of the independent
public accountants for the Company, and with your representatives and
your counsel at which the contents of the Registration Statement, the
Prospectus and related matters were discussed and, although such
counsel need not pass upon or assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus and need not make any
independent check or verification thereof (other than as specified in
subparagraph (viii) above insofar as the captions referred to therein
relate to provisions of documents), on the basis of the foregoing, no
facts have come to the attention of such counsel which have led such
counsel to believe that the Registration Statement, at the time it
became effective, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, or that the
Prospectus, as of its date and as of the Closing Date, contained any
untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading, except
that such counsel need not express any opinion as to the financial
statements, schedules and other financial data included in or excluded
from the Registration Statement.
Such counsel may also state in such opinion that (i) whenever such
counsel indicates that the opinion is with respect to matters within the
"knowledge of" or "known by" such counsel, such knowledge means the
representations and warranties of the Company contained in this Agreement
and in the documents delivered on the Closing Date by the Company pursuant
to this Agreement, and the current conscious awareness of facts of the
attorneys currently practicing law with such firm who had involvement in
the transaction or such other attorneys presently in the firm whom such
counsel has determined are likely, in the course of representing the
Company, to have knowledge of the matters covered by the opinion, and that
(ii) such opinion is limited to the laws of the United States, the State of
Wisconsin and the General Corporation Law of the State of Delaware. As to
matters involving the application of laws of any jurisdiction other than
the State of Wisconsin, the General Corporation Law of the State of
Delaware, and the United States, such counsel may assume that the laws of
such jurisdiction are identical to the laws of the State of Wisconsin.
(d) You shall have received on the Closing Date an opinion of ▇▇▇▇▇▇▇
& ▇▇▇▇, S.C., counsel for the Selling Shareholders, to the effect that:
(i) this Agreement has been duly authorized, executed and
delivered by or on behalf of each of the Selling Shareholders;
14
(ii) the execution and delivery by each Selling Shareholder of,
and the performance by such Selling Shareholder of its obligations
under, this Agreement and the Power of Attorney and Custody Agreement
of such Selling Shareholder will not contravene any provision of the
laws of the State of Wisconsin or the federal laws of the United
States applicable to each Selling Shareholder or, to the best of such
counsel's knowledge, without independent investigation other than
inquiry of such Selling Shareholder, any agreement or other instrument
binding upon such Selling Shareholder or, to the best of such
counsel's knowledge, without independent investigation other than
inquiry of such Selling Shareholder, any judgment, order or decree of
any governmental body, agency or court having jurisdiction over such
Selling Shareholder, and no consent, approval, authorization or order
of or qualification with any federal or State of Wisconsin
governmental body or agency is required for the performance by such
Selling Shareholder of its obligations under this Agreement or the
Power of Attorney and Custody Agreement of such Selling Shareholder,
except such as have been obtained or such as may be required by
securities or Blue Sky laws in connection with the offer and sale of
the Shares;
(iii) each of the Selling Shareholders has the legal right and
power, and all authorization and approval required by federal or State
of Wisconsin law, to enter into this Agreement and the Power of
Attorney and Custody Agreement of such Selling Shareholder and to
sell, transfer and deliver the Shares to be sold by such Selling
Shareholder;
(iv) the Power of Attorney and Custody Agreement of each Selling
Shareholder has been authorized, executed and delivered by such
Selling Shareholder and is a valid and binding agreement of such
Selling Shareholder; and
(v) delivery of the Shares to be sold by each Selling
Shareholder pursuant to this Agreement will pass marketable title to
such Shares free and clear of any security interests, claims, liens,
equities and other encumbrances to each of the several Underwriters
who have purchased Shares in good faith and without notice of any such
security interest, claim, lien, equity, encumbrance or any other
adverse claim within the meaning of the Uniform Commercial Code.
(e) You shall have received on the Closing Date an opinion of Shearman
& Sterling, special counsel for the Underwriters, dated the Closing Date.
With respect to subparagraphs (xi) and (xii) of paragraph (c) above,
▇▇▇▇▇▇▇ & ▇▇▇▇, S.C. and, with respect to paragraph (e) above, Shearman &
Sterling may state that their opinion and belief are based upon their
participation in the preparation of the
15
Registration Statement and Prospectus and any amendments or supplements thereto
and review and discussion of the contents thereof, but are without independent
check or verification, except as specified.
With respect to paragraph (d) above, ▇▇▇▇▇▇▇ & ▇▇▇▇, S.C. may rely
upon the representations of each Selling Shareholder contained herein and in the
Power of Attorney and Custody Agreement of such Selling Shareholder and in other
documents and instruments; provided that copies of such Power of Attorney and
Custody Agreement and of any such other documents and instruments shall be
delivered to you and shall be in form and substance satisfactory to your
counsel.
The opinions of ▇▇▇▇▇▇▇ & ▇▇▇▇, S.C. described in paragraphs (c) and
(d) above shall be rendered to you at the request of the Company and the Selling
Shareholders, respectively, and shall so state therein.
(f) You shall have received, on each of the date hereof and the
Closing Date, a letter dated the date hereof or the Closing Date, as the
case may be, in form and substance satisfactory to you, from Ernst & Young
LLP, independent public accountants, containing statements and information
of the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain financial
information contained in the Registration Statement and the Prospectus.
(g) You shall have received on the Closing Date certificates dated the
Closing Date and signed by the Selling Shareholders or by an attorney-in-
fact of the Selling Shareholders, to the effect that the representations
and warranties of each Selling Shareholder contained in this Agreement are
true and correct as of the Closing Date and that each Selling Shareholder
has complied with all of the agreements and satisfied all of the conditions
on its part to be performed or satisfied hereunder on or before the Closing
Date.
The several obligations of the Underwriters to purchase Additional
Shares hereunder are subject to the delivery to the Representatives on the
Option Closing Date of such documents as they may reasonably request with
respect to the good standing of the Company, the due authorization and issuance
of the Additional Shares and other matters related to the issuance of the
Additional Shares.
VII.
In further consideration of the agreements of the Underwriters herein
contained, the Company covenants as follows:
16
(a) To furnish to you, without charge, five signed copies of the
Registration Statement (including exhibits thereto) and for delivery to
each other Underwriter a conformed copy of the Registration Statement
(without exhibits thereto) and, during the period mentioned in paragraph
(c) below, as many copies of the Prospectus, any documents incorporated by
reference therein and any supplements and amendments thereto or to the
Registration Statement as you may reasonably request. In the case of the
Prospectus, to furnish copies of the Prospectus in New York City prior to
5:00 p.m. on the business day following the date of this Agreement, in such
quantities as you reasonably request.
(b) Before amending or supplementing the Registration Statement or the
Prospectus, to furnish to you a copy of each such proposed amendment or
supplement and to file no such proposed amendment or supplement to which
you reasonably object unless, in the reasonable judgment of the Company and
its counsel, such amendment or supplement is necessary to comply with law
or to make the statements therein not misleading.
(c) If, during such period after the first date of the public offering
of the Shares as in the opinion of your counsel the Prospectus is required
by law to be delivered in connection with sales by an Underwriter or
dealer, any event shall occur or condition exist as a result of which it is
necessary to amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances existing when the
Prospectus is delivered to a purchaser, not misleading, or if, in the
opinion of your counsel, it is necessary to amend or supplement the
Prospectus to comply with law, forthwith to prepare, file with the
Commission and furnish, at its own expense, to the Underwriters and to the
dealers (whose names and addresses you will furnish to the Company) to
which Shares may have been sold by you on behalf of the Underwriters and to
any other dealers upon request, either amendments or supplements to the
Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the
Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus, as amended or supplemented, will comply with law.
(d) To endeavor to qualify the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request and to maintain such qualification for as long as you shall
reasonably request and to pay all expenses (including reasonable fees and
disbursements of counsel) in connection with such qualification and in
connection with any required review of the offering of the Shares by the
National Association of Securities Dealers, Inc.
(e) To make generally available to the Company's security holders and
to you, as soon as practicable, an earning statement that satisfies the
provisions of Section 11(a) of the Securities Act and the rules and
regulations of the Commission thereunder.
17
(f) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of its obligations under this
Agreement, including: (i) the preparation and filing of the Registration
Statement and the Prospectus and all amendments and supplements thereto,
(ii) the preparation, issuance and delivery of the Shares, including any
transfer or other taxes payable on the Company Shares, (iii) the fees and
disbursements of the Company's counsel and accountants and of the counsel
and accountants for the Selling Shareholders, (iv) the qualification of the
Shares under securities or Blue Sky laws in accordance with paragraph (d)
above, including filing fees and the fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the
preparation of any Blue Sky or Legal Investment Memoranda, (v) the printing
and delivery to the Underwriters in quantities as hereinabove stated of
copies of the Registration Statement and all amendments thereto and of the
Prospectus and any amendments or supplements thereto, (vi) the costs and
charges of any transfer agent, registrar or depositary, (vii) the costs and
expenses of the Company relating to investor presentations on any "road
show" undertaken in connection with the marketing of the Offering,
including, without limitation, expenses associated with the production of
road show slides and graphics, fees and expenses of any consultants engaged
in connection with the road show presentations with the prior approval of
the Company, travel and lodging expense of the representatives and officers
of the Company and any such consultants, and the cost of any aircraft
chartered in connection with the road show and (viii) all other costs and
expenses incident to the performance of the obligations of the Company and
the Selling Shareholders hereunder for which provision is not otherwise
made in this Section.
VIII.
Each Selling Shareholder, severally and not jointly, agrees to pay or
cause to be paid all taxes, if any, on the transfer and sale of the Shares being
sold by such Selling Shareholder.
IX.
The Company agrees to indemnify and hold harmless each Underwriter and
each person, if any, who controls any Underwriter within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred in connection with
defending or investigating any such action or claim) caused by any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereof, any preliminary prospectus or
the
18
Prospectus (as amended or supplemented if the Company shall have furnished any
amendments or supplements thereto), or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue statement
or omission or alleged untrue statement or omission based upon information
relating to any Underwriter furnished to the Company in writing by such
Underwriter through you expressly for use therein; provided, however, that the
foregoing indemnity agreement with respect to any preliminary prospectus shall
not inure to the benefit of any Underwriter from whom the person asserting any
such losses, claims, damages or liabilities purchased Shares, or any person
controlling such Underwriter, if a copy of the Prospectus (as then amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) was not sent or given by or on behalf of such Underwriter to such
person, if required by law so to have been delivered, at or prior to the written
confirmation of the sale of the Shares to such person, and if the Prospectus (as
so amended or supplemented) would have cured the defect giving rise to such
losses, claims, damages or liabilities.
The Company will indemnify and hold harmless each of the Selling
Shareholders to the same extent that the Company indemnifies and holds harmless
each Underwriter pursuant to the preceding paragraph; provided, however, the
Company shall not be liable under this paragraph to the extent any losses,
claims, damages or liabilities described in the preceding paragraph arise out of
or are based upon an untrue statement or omission or alleged untrue statement or
omission based upon information relating to such Selling Shareholder furnished
in writing by or on behalf of such Selling Shareholder expressly for use in the
Registration Statement, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
Each Selling Shareholder agrees, severally and not jointly, to
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act and the Company, its directors,
its officers who sign the Registration Statement and each person, if any, who
controls the Company within the meaning of either such Section, from and against
any and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred in connection with
defending or investigating any such action or claim) caused by any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereof, any preliminary prospectus or
the Prospectus (as amended or supplemented if the Company shall have furnished
any amendments or supplements thereto) or caused by any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, but only with reference
to information relating to such Selling Shareholder furnished in writing by or
on behalf of such Selling Shareholder
19
expressly for use in the Registration Statement, any preliminary prospectus, the
Prospectus or any amendments or supplements thereto.
Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, the Selling Shareholders, the directors of the
Company, the officers of the Company who sign the Registration Statement and
each person, if any, who controls the Company or any Selling Shareholder within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment thereof,
any preliminary prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
but only with reference to information relating to such Underwriter furnished to
the Company in writing by such Underwriter through you expressly for use in the
Registration Statement, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to any of the four preceding paragraphs, such person (the
"indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing (but the failure
to so notify the indemnifying party will not relieve it from any liability which
it may have to any indemnified party otherwise than under this Article IX) and
the indemnifying party, upon request of the indemnified party, shall retain
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in such
proceeding and shall pay the fees and disbursements of such counsel related to
such proceeding. In any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such indemnified party unless (i) the indemnifying party
and the indemnified party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified party
and representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. It is understood
that the indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for (a) the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Underwriters and all
persons, if any, who control any Underwriter within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act, (b) the fees
and expenses of more than one separate firm (in addition to
20
any local counsel) for the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company within
the meaning of either such Section, (c) the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Selling Shareholders
and all persons, if any, who control any Selling Shareholder within the meaning
of either such Section and all persons, if any, who control any of such Selling
Shareholders within the meaning of either such Section, and that all such fees
and expenses shall be reimbursed as they are incurred. In the case of any such
separate firm for the Underwriters and such control persons of Underwriters,
such firm shall be designated in writing by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated.
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
Shareholders and such controlling persons of Selling Shareholders, such firm
shall be designated in writing by the Company. The indemnifying party shall not
be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by the second and third
sentences of this paragraph, the indemnifying party agrees that it shall be
liable for any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than 30 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying party
shall not have reimbursed the indemnified party in accordance with such request
prior to the date of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
If the indemnification provided for in the first, second, third or
fourth paragraph of this Article IX is unavailable to an indemnified party or
insufficient in respect of any losses, claims, damages or liabilities referred
to therein, then each indemnifying party under such paragraph, in lieu of
indemnifying such indemnified party thereunder, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect the
relative benefits received by the indemnifying party or parties on the one hand
and the indemnified party or parties on the other hand from the offering of the
Shares or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the indemnifying party or parties on the one hand and of the indemnified party
or parties on the other hand in connection with the statements or omissions that
resulted
21
in such losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Selling Shareholders on the one hand and the Underwriters on the other hand in
connection with the offering of the Shares shall be deemed to be in the same
respective proportions as the net proceeds from the offering of the Shares
(before deducting expenses) received by the Company and each Selling Shareholder
and the total underwriting discounts and commissions received by the
Underwriters, in each case as set forth in the table on the cover of the
Prospectus, bear to the aggregate public offering price of the Shares. The
relative fault of the Company and the Selling Shareholders 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, the Selling Shareholders or the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The
Underwriters' respective obligations to contribute pursuant to this Article IX
are several in proportion to the respective number of Shares they have purchased
hereunder, and not joint.
The Company, the Selling Shareholders and the Underwriters agree that
it would not be just or equitable if contribution pursuant to this Article IX
were determined by pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation that does not
take account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages and liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Article IX, no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Shares underwritten by it and distributed
to the public were offered to the public exceeds the amount of any damages that
such Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The remedies provided for in this
Article IX 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.
The indemnity and contribution provisions contained in this Article IX
and the representations and warranties of the Company and the Selling
Shareholders contained in this Agreement shall remain operative and in full
force and effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter, any Selling Shareholder or any
22
person controlling any Selling Shareholder, or the Company, its officers or
directors or any person controlling the Company and (iii) acceptance of and
payment for any of the Shares.
The liability of the Company or each Selling Shareholder under this
Article IX shall not exceed an amount equal to the initial public offering price
of the Shares sold by the Company or such Selling Shareholder, less the
applicable underwriting discounts and commissions.
X.
This Agreement shall be subject to termination by notice given by you
to the Sellers, if (a) after the execution and delivery of this Agreement and
prior to the Closing Date (i) trading generally shall have been suspended or
materially limited on or by, as the case may be, any of the New York Stock
Exchange, the American Stock Exchange, the National Association of Securities
Dealers, Inc., the Chicago Board of Options Exchange, the Chicago Mercantile
Exchange or the Chicago Board of Trade, (ii) trading of any securities of the
Company shall have been suspended on any exchange, (iii) a general moratorium on
commercial banking activities in New York shall have been declared by either
Federal or New York State authorities or (iv) there shall have occurred any
outbreak or escalation of hostilities or any change in financial markets or any
calamity or crisis that, in your judgment, is material and adverse and (b) in
the case of any of the events specified in clauses (a)(i) through (iv), such
event singly or together with any other such event makes it, in your reasonable
judgment, impracticable to market the Shares on the terms and in the manner
contemplated in the Prospectus.
XI.
This Agreement shall become effective upon the later of (x) execution
and delivery hereof by the parties hereto and (y) release of notification of the
effectiveness of the Registration Statement by the Commission.
If, on the Closing Date or the Option Closing Date, as the case may
be, any one or more of the Underwriters shall fail or refuse to purchase Shares
that it or they have agreed to purchase hereunder on such date, and the
aggregate number of Shares which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate number of the Shares to be purchased on such date, the other
Underwriters shall be obligated severally in the proportions that the number of
Firm Shares set forth opposite their respective names in Schedule I bears to the
aggregate number of Firm Shares set forth opposite the names of all such non-
defaulting Underwriters, or in such other proportions as you may specify, to
purchase the Shares which such defaulting Underwriter or
23
Underwriters agreed but failed or refused to purchase on such date; provided
that in no event shall the number of Shares that any Underwriter has agreed to
purchase pursuant to this Agreement be increased pursuant to this Article XI by
an amount in excess of one-ninth of such number of Shares without the written
consent of such Underwriter. If, on the Closing Date or the Option Closing
Date, as the case may be, any Underwriter or Underwriters shall fail or refuse
to purchase Shares and the aggregate number of Shares with respect to which such
default occurs is more than one-tenth of the aggregate number of Shares to be
purchased on such date, and arrangements satisfactory to you, the Company and
the Selling Shareholders for the purchase of such Shares are not made within 36
hours after such default, this Agreement shall terminate without liability on
the part of any non-defaulting Underwriter, the Selling Shareholders or the
Company. In any such case you, the Selling Shareholders or the Company shall
have the right to postpone the Closing Date or the Option Closing Date, as the
case may be, but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement and in the Prospectus or
in any other documents or arrangements may be effected. Any action taken under
this paragraph shall not relieve any defaulting Underwriter from liability in
respect of any default of such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company or any
Selling Shareholder to comply with the terms or to fulfill any of the conditions
of this Agreement, or if for any reason the Company or the Selling Shareholder
shall be unable to perform its obligations under this Agreement, the Company and
the Selling Shareholders will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder; provided that neither the Company nor any
Selling Shareholder shall have any further liability to any Underwriter
(including any liability for damages, including loss of anticipated profits) for
any termination of this Agreement, except as provided in Article IX hereof.
This Agreement may be signed in two or more counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.
24
This Agreement shall be governed by the laws of the State of New York.
Very truly yours,
▇▇▇▇'▇ CORPORATION
By_________________
Name:
Title:
The Selling Shareholders named in Schedule
II hereto, acting severally
By_________________
Attorney-in-Fact
Name:
Title:
25
Accepted, August [ ], 1997
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
▇▇▇▇▇▇▇▇▇▇ Securities
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Company, L.L.C.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated
Acting severally on behalf of themselves
and the several Underwriters
named in Schedule I hereto.
By ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated
By__________________________
26
SCHEDULE I
Underwriters
------------
Number of
Firm Shares
Underwriters To Be Purchased
---------------------------------------------------- ---------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
▇▇▇▇▇▇▇▇▇▇ Securities
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Company, L.L.C.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Co. Incorporated
---------------
Total Firm Shares................................... 4,000,000
===============
27
SCHEDULE II
Selling Shareholders
--------------------
Number of
Firm Shares
Selling Shareholders To Be Sold
-------------------------------------- -----------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Irrevocable Trust 152,500
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Children's Trusts 152,500
▇▇▇ ▇. ▇▇▇▇▇ 150,000
▇▇▇▇ ▇. ▇▇▇▇▇ 1987 Trust 187,000
R. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 17,000
▇▇▇▇▇ ▇▇▇▇▇ 17,000
▇▇▇▇▇ ▇▇▇▇▇▇▇ 14,000
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇ 10,000
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Total Shares.......................... 700,000
