EXHIBIT 1.1
6,250,000
eFunds Corporation
UNDERWRITING AGREEMENT
----------------------
June __, 2000
XXXXXX BROTHERS INC.
Bear, Xxxxxxx & Co. Inc.
FAC/Equities, a division of
First Albany Corporation
Xxxx X. Xxxxxxx & Company, Incorporated
As Representatives of the several
Underwriters named in Schedule 1,
c/x Xxxxxx Brothers Inc.
Three World Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
eFunds Corporation, a Delaware corporation (the "Company"), proposes to
sell 6,250,000 shares (the "Firm Stock") of the Company's Common Stock, par
value $.01 per share (the "Common Stock"). In addition, the Company proposes to
grant to the Underwriters named in Schedule 1 hereto (the "Underwriters") an
option to purchase up to an additional 937,500 shares of the Common Stock on the
terms and for the purposes set forth in Section 3 (the "Option Stock"). The Firm
Stock and the Option Stock, if purchased, are hereinafter collectively called
the "Stock." This is to confirm the agreement concerning the purchase of the
Stock from the Company by the Underwriters named in Schedule 1 hereto (the
"Underwriters"). The Company is a wholly owned subsidiary of Deluxe Corporation,
a Minnesota corporation ("Deluxe").
1. Representations, Warranties and Agreements of the Company and
Deluxe. The Company and Deluxe, jointly and severally, represent, warrant and
agree that:
(a) A registration statement on Form S-1, and amendments
thereto, with respect to the Stock have (i) been prepared by the
Company in conformity with the requirements of the Securities Act of
1933 (the "Securities Act") and the rules and regulations (the "Rules
and Regulations") of the Securities and Exchange Commission (the
"Commission") thereunder, (ii) been filed with the Commission under the
Securities Act and (iii) become effective under the Securities Act; a
second registration statement on Form S-1 with respect to the Stock (i)
may also be prepared by the Company in conformity with the requirements
of the Securities Act and
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the Rules and Regulations and (ii) if to be so prepared, will be filed
with the Commission under the Securities Act pursuant to Rule 462(b) of
the Rules and Regulations on the date hereof. Copies of the first such
registration statement and the amendments to such registration
statement, together with the form of any such second registration
statement, have been delivered by the Company to you as the
representatives (the "Representatives") of the Underwriters. As used in
this Agreement, "Effective Time" means (i) with respect to the first
such registration statement, the date and the time as of which such
registration statement, or the most recent post-effective amendment
thereto, if any, was declared effective by the Commission and (ii) with
respect to any second registration statement, the date and time as of
which such second registration statement is filed with the Commission,
and "Effective Times" is the collective reference to both Effective
Times; "Effective Date" means (i) with respect to the first s uch
registration statement, the date of the Effective Time of such
registration statement and (ii) with respect to any second registration
statement, the date of the Effective Time of such second registration
statement, and "Effective Dates" is the collective reference to both
Effective Dates; "Preliminary Prospectus" means each prospectus
included in any such 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
Representatives pursuant to Rule 424(a) of the Rules and Regulations;
"Primary Registration Statement" means the first registration statement
referred to in this Section 1(a), as amended at its Effective Time,
"Rule 462(b) Registration Statement" means the second registration
statement, if any, referred to in this Section 1(a), as filed with the
Commission, and "Registration Statements" means both the Primary
Registration Statement and any Rule 462(b) Registration Statemen t,
including in each case all information contained in the final
prospectus filed with the Commission pursuant to Rule 424(b) of the
Rules and Regulations in accordance with Section 6(a) hereof and deemed
to be a part of the Registration Statements as of the Effective Time of
the Primary Registration Statement pursuant to paragraph (b) of Rule
430A of the Rules and Regulations; and "Prospectus" means such final
prospectus, as first filed with the Commission pursuant to paragraph
(1) or (4) of Rule 424(b) of the Rules and Regulations. The Commission
has not issued any order preventing or suspending the use of any
Preliminary Prospectus.
(b) The Primary Registration Statement conforms (and the Rule
462(b) Registration Statement, if any, the Prospectus and any further
amendments or supplements to the Registration Statements or the
Prospectus, when they become effective or are filed with the
Commission, as the case may be, will conform) in all respects to the
requirements of the Securities Act and the Rules and Regulations and do
not and will not, as of the applicable effective date (as to the
Registration Statements and any amendment thereto) and as of the
applicable filing date (as to the Prospectus and any amendment or
supplement thereto) contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading; provided that
no representation or warranty is made as to information contained in or
omitted from the Registration Statements or the Prospectus in reliance
upon and in conformity with written
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information furnished to the Company or Deluxe through the
Representatives by or on behalf of any Underwriter specifically for
inclusion therein.
(c) The Company and each of its subsidiaries (as defined in
Section 17) have been duly incorporated and are validly existing as
corporations in good standing under the laws of their respective
jurisdictions of incorporation, are duly qualified to do business and
are in good standing as foreign corporations in each jurisdiction in
which their respective ownership or lease of property or the conduct of
their respective businesses requires such qualification unless the
failure to be so qualified would render unenforceable contracts entered
into by it or subject it to any material liability or disability, and
have all corporate power and authority necessary to own or hold their
respective properties and to conduct the businesses in which they are
engaged; and none of the subsidiaries of the Company (other than
________, ________ and ________ (collectively, the "Significant
Subsidiaries")) is a "significant subsidiary", as such term is defined
in Rule 405 of the Rules and Regulations.
(d) This Agreement has been duly authorized, executed and
delivered by the Company.
(e) The Company has an authorized capitalization as set forth
in the Prospectus, and all of the issued shares of capital stock of the
Company 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 and non-assessable and (except
as set forth in the Prospectus) are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities or claims.
(f) The unissued shares of the 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; and the Stock will conform to the description thereof
contained in the Prospectus.
(g) The execution, delivery and performance of this Agreement
by the Company and the consummation of the transactions contemplated
hereby will not conflict with or result in a breach or violation of any
of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries is bound or to
which any of the properties or assets of the Company or any of its
subsidiaries is subject, nor will such actions result in any violation
of the provisions of the charter or by-laws of the Company or any of
its subsidiaries or any statute or any order, rule or regulation 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; and except for the registration of the Stock under the
Securities Act and such consents, approvals, authorizations,
registrations or
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qualifications as may be required under the Exchange Act and applicable
state securities laws in connection with the purchase and distribution
of the Stock 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.
(h) Except as described in the Prospectus, there are no
contracts, agreements or understandings between the Company or Deluxe
and any person granting such person the right to require the Company or
Deluxe to file a registration statement under the Securities Act with
respect to any securities of the Company owned or to be owned by such
person or to require the Company or Deluxe to include such securities
in the securities registered pursuant to the Registration Statements or
in any securities being registered pursuant to any other registration
statement filed by the Company under the Securities Act.
(i) 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.
(j) Neither the Company nor any of its subsidiaries has
sustained, since the date of the latest audited financial statements
included in the Prospectus, any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus; and, since such date, there has not
been any change in the capital stock or long-term debt of the Company
or any of its subsidiaries or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole, otherwise than as set forth or
contemplated in the Prospectus.
(k) The financial statements (including the related notes and
supporting schedules) filed as part of the Registration Statements or
included in the Prospectus present fairly the financial condition and
results of operations of the entities purported to be shown thereby, at
the dates and for the periods indicated, and have been prepared in
conformity with generally accepted accounting principles applied on a
consistent basis throughout the periods involved.
(l) Deloitte & Touche LLP, who have certified certain
financial statements of the Company, whose report appears in the
Prospectus and who have delivered the initial letter referred to in
Section 8(f) hereof, are independent public accountants as required by
the Securities Act and the Rules and Regulations.
(m) 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
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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.
(n) The Company and each of its subsidiaries carry, or are
covered by, insurance in such amounts and covering such risks as the
Company has determined is reasonable for the conduct of their
respective businesses and the value of their respective properties.
(o) Except as disclosed in the Prospectus, the Company and
each of its subsidiaries own or possess adequate rights to use all
material patents, patent applications, trademarks, service marks, trade
names, trademark registrations, service xxxx registrations, copyrights
and licenses necessary for the conduct of their respective businesses
and have no reason to believe that the conduct of their respective
businesses will conflict with, and have not received any notice of any
claim of conflict with, any such rights of others that would be
reasonably expected to have a material adverse effect on the
consolidated financial position, stockholders' equity, results of
operations, business or prospects of the Company and its subsidiaries
taken as a whole or on the ability of the parties to consummate the
transactions contemplated hereby (a "Material Adverse Effect").
(p) There are no legal or governmental proceedings pending to
which the Company or any of its subsidiaries is a party or of which any
property or asset of the Company or any of its subsidiaries is the
subject which, if determined adversely to the Company or any of its
subsidiaries, would be reasonably expected to have a Material Adverse
Effect; and to the best of the Company's and Deluxe's knowledge, no
such proceedings are threatened or contemplated by governmental
authorities or threatened by others.
(q) There are no contracts or other documents which are
required to be described in the Prospectus or filed as exhibits to
either of the Registration Statements by the Securities Act or by the
Rules and Regulations which have not been described in the Prospectus
or filed as exhibits to either of the Registration Statements or
incorporated therein by reference as permitted by the Rules and
Regulations.
(r) 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.
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(s) No labor disturbance by the employees of the Company
exists or, to the knowledge of the Company or Deluxe, is imminent which
might be expected to have a Material Adverse Effect.
(t) The Company is in compliance in all material respects with
all presently applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations and
published interpretations thereunder ("ERISA"); no "reportable event"
(as defined in ERISA) has occurred with respect to any "pension plan"
(as defined in ERISA) for which the Company would have any liability;
the Company has not incurred and does not expect to incur liability
under (i) Title IV of ERISA with respect to termination of, or
withdrawal from, any "pension plan" or (ii) Sections 412 or 4971 of the
Internal Revenue Code of 1986, as amended, including the regulations
and published interpretations thereunder (the "Code"); and each
"pension plan" for which the Company would have any liability that is
intended to be qualified under Section 401(a) of the Code is so
qualified in all material respects and nothing has occurred, whether by
action or by failure to act, which would cause the loss of such
qualifica tion.
(u) The Company has filed all federal, state and local income
and franchise tax returns required to be filed through the date hereof
and has paid all taxes due thereon, and no tax deficiency has been
determined adversely to the Company or any of its subsidiaries which
has had (nor does the Company or Deluxe have any knowledge of any tax
deficiency which, if determined adversely to the Company or any of its
subsidiaries, might have) a Material Adverse Effect.
(v) Since the date as of which information is given in the
Prospectus through the date hereof, and except as may otherwise be
disclosed in the Prospectus, the Company has not (i) issued or granted
any securities, (ii) incurred any liability or obligation, direct or
contingent, other than liabilities and obligations which were incurred
in the ordinary course of business, (iii) entered into any transaction
not in the ordinary course of business or (iv) declared or paid any
dividend on its capital stock.
(w) The Company (i) makes and keeps accurate books and records
and (ii) 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.
(x) Neither the Company nor any of its subsidiaries (i) is in
violation of its charter or by-laws, (ii) is in default in any material
respect, and no event has occurred which, with notice or lapse of time
or both, would constitute such a default, in the due performance or
observance
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of any term, covenant or condition contained in any material indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which it is a party or by which it is bound or to which
any of its properties or assets is subject or (iii) is in violation in
any material respect of any law, ordinance, governmental rule,
regulation or court decree to which it or its properties or assets may
be subject or has failed to obtain any material license, permit,
certificate, franchise or other governmental authorization or permit
necessary to the ownership of its properties or assets or to the
conduct of its business.
(y) Neither the Company nor any of its subsidiaries, nor any
director, officer, agent, employee or other person associated with or
acting on behalf of the Company or any of its subsidiaries, has used
any corporate funds for any unlawful contribution, gift, entertainment
or other unlawful expense relating to political activity; made any
direct or indirect unlawful payment to any foreign or domestic
government official or employee from corporate funds; violated or is in
violation of any provision of the Foreign Corrupt Practices Act of
1977; or made any bribe, rebate, payoff, influence payment, kickback or
other unlawful payment.
(z) 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
or Deluxe, 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 be reasonably likely to have, singularly or in
the aggregate with all such violations and remedial actions, a Material
Adverse Effect; 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 p roperty 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 or Deluxe 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, singularly or
in the aggregate with all such spills, discharges, leaks, emissions,
injections, escapes, dumpings and releases, a Material Adverse Effect;
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.
(aa) Neither the Company nor any subsidiary is an "investment
company" within the meaning of such term under the Investment Company
Act of 1940 and the rules and regulations of the Commission thereunder.
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2. Representations, Warranties and Agreements of Deluxe. Deluxe
represents, warrants and agrees that:
(a) Deluxe has been duly incorporated and is validly existing
as a corporation in good standing under Minnesota law.
(b) All issued shares of capital stock of the Company are
owned directly or indirectly by Deluxe, free and clear of all liens,
encumbrances, equities or claims.
(c) This Agreement has been duly authorized, executed and
delivered by Deluxe; the execution, delivery and performance of this
Agreement by Deluxe and the consummation by Deluxe of the transactions
contemplated hereby will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which Deluxe or any of its subsidiaries is a
party or by which Deluxe or any of its subsidiaries is bound or to
which any of the property or assets of Deluxe or any of its
subsidiaries is subject, nor will such actions result in any violation
of the charter or by-laws of Deluxe or any of its subsidiaries or any
statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over Deluxe or any of their property
or assets; and, except for the registration of the Stock under the
Securities Act and such consents, approvals, authorizations, reg
istrations or qualifications as may be required under the Exchange Act
and applicable state securities laws in connection with the purchase
and distribution of the Stock 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 Deluxe and the
consummation by Deluxe of the transactions contemplated hereby.
(d) Deluxe has not taken and will not take, directly or
indirectly, any action which is designed to or which has constituted or
which might reasonably be expected to cause or result in the
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the shares of the Stock.
(e) Deluxe is in compliance in all material respects with all
presently applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations and
published interpretations thereunder ("ERISA"); no "reportable event"
(as defined in ERISA) has occurred with respect to any "pension plan"
(as defined in ERISA) for which Deluxe would have any liability; Deluxe
has not incurred and does not expect to incur liability under (i) Title
IV of ERISA with respect to termination of, or withdrawal from, any
"pension plan" or (ii) Sections 412 or 4971 of the Internal Revenue
Code of 1986, as amended, including the regulations and published
interpretations thereunder (the "Code"); and each "pension plan" for
which Deluxe would have any liability that is intended to be qualified
under Section 401(a) of the Code is so qualified in all material
respects and nothing has
9
occurred, whether by action or by failure to act, which would cause the
loss of such qualification.
(f) Deluxe has filed all federal, state and local income and
franchise tax returns required to be filed through the date hereof and
has paid all taxes due thereon, and no tax deficiency has been
determined adversely to Deluxe or any of its subsidiaries which has had
(nor does Deluxe have any knowledge of any tax deficiency which, if
determined adversely to Deluxe or any of its subsidiaries, might have)
a Material Adverse Effect.
3. Purchase of the Stock by the Underwriters. On the basis of the
representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Company agrees to sell 6,250,000 shares of
the Firm Stock to the several Underwriters and each of the Underwriters,
severally and not jointly, agrees to purchase the number of shares of the Firm
Stock set opposite that Underwriter's name in Schedule 1 hereto. The respective
purchase obligations of the Underwriters with respect to the Firm Stock shall be
rounded among the Underwriters to avoid fractional shares, as the
Representatives may determine.
In addition, the Company grants to the Underwriters an option to
purchase up to 937,500 shares of Option Stock. Such option is granted solely for
the purpose of covering over-allotments in the sale of Firm Stock and is
exercisable as provided in Section 5 hereof. Shares of Option Stock shall be
purchased severally for the account of the Underwriters in proportion to the
number of shares of Firm Stock set opposite the name of such Underwriters in
Schedule 1 hereto. The respective purchase obligations of each Underwriter with
respect to the Option Stock shall be adjusted by the Representatives so that no
Underwriter shall be obligated to purchase Option Stock other than in 100 share
amounts.
The price of both the Firm Stock and any Option Stock shall be $_____
per share.
The Company shall not be obligated to deliver any of the Stock to be
delivered on the First Delivery Date or the Second Delivery Date (as hereinafter
defined), as the case may be, except upon payment for all the Stock to be
purchased on such Delivery Date as provided herein.
4. Offering of Stock by the Underwriters.
Upon authorization by the Representatives of the release of the Firm
Stock, the several Underwriters propose to offer the Firm Stock for sale upon
the terms and conditions set forth in the Prospectus; provided, however, that no
Stock registered pursuant to the Rule 462(b) Registration Statement, if any,
shall be offered prior to the Effective Time thereof.
5. Delivery of and Payment for the Stock. Delivery of and payment for
the Firm Stock shall be made at the office of Xxxxxxx Xxxxxxx & Xxxxxxxx at 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 A.M., New York City time,
on the fourth full business day following the
10
date of this Agreement or at such other date or place as shall be determined by
agreement between the Representatives and the Company. This date and time are
sometimes referred to as the "First Delivery Date." On the First Delivery Date,
the Company shall deliver or cause to be delivered certificates representing the
Firm Stock to the Representatives for the account of each Underwriter against
payment to or upon the order of the Company of the purchase price by wire
transfer of immediately available funds. Time shall be of the essence, and
delivery at the time and place specified pursuant to this Agreement is a further
condition of the obligation of each Underwriter hereunder. Upon delivery, the
Firm Stock shall be registered in such names and in such denominations as the
Representatives shall request in writing not less than two full business days
prior to the First Delivery Date. For the purpose of expediting the checking and
packaging of the certificates for the Firm Stock, the Company shall make the
certificates representing the Firm Stock available for inspection by the
Representatives in New York, New York, not later than 2:00 P.M., New York City
time, on the business day prior to the First Delivery Date.
At any time on or before the thirtieth day after the date of this
Agreement the option granted in Section 3 may be exercised by written notice
being given to the Company by the Representatives. Such notice shall set forth
the aggregate number of shares of Option Stock as to which the option is being
exercised, the names in which the shares of Option Stock are to be registered,
the denominations in which the shares of Option Stock are to be issued and the
date and time, as determined by the Representatives, when the shares of Option
Stock are to be delivered; provided, however, that this date and time shall not
be earlier than the First Delivery Date nor earlier than the second business day
after the date on which the option shall have been exercised nor later than the
fifth business day after the date on which the option shall have been exercised.
The date and time the shares of Option Stock are delivered are sometimes
referred to as the "Second Delivery Date" and the First Delivery Date and the
Second Del xxxxx Date are sometimes each referred to as a "Delivery Date".
Delivery of and payment for the Option Stock shall be made at the place
specified in the first sentence of the first paragraph of this Section 5 (or at
such other place as shall be determined by agreement between the Representatives
and the Company) at 10:00 A.M., New York City time, on the Second Delivery Date.
On the Second Delivery Date, the Company shall deliver or cause to be delivered
the certificates representing the Option Stock to the Representatives for the
account of each Underwriter against payment to or upon the order of the Company
of the purchase price by wire transfer of immediately available funds. Time
shall be of the essence, and delivery at the time and place specified pursuant
to this Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, the Option Stock shall be registered in such names and
in such denominations as the Representatives shall request in the aforesaid
written notice. For the purpose of expediting the checking and packaging of the
certificates for the Option Stock, the Company shall make the certificates
representing the Option Stock available for inspection by the Representatives in
New York, New York, not later than 2:00 P.M., New York City time, on the
business day prior to the Second Delivery Date.
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6. Further Agreements of the Company and Deluxe. Each of the Company
and, with respect to Section 6(a), 6(b), 6(c), 6(d), 6(e), 6(h), 6(i) and 6(j)
hereof, Deluxe, jointly and severally, agrees with each of the Underwriters.
(a) To prepare the Rule 462(b) Registration Statement, if
necessary, in a form approved by the Representatives and to file such
Rule 462(b) Registration Statement with the Commission on the date
hereof; to prepare the Prospectus in a form approved by the
Representatives and to file such Prospectus pursuant to Rule 424(b)
under the Securities Act not later than 10:00 A.M., New York City time,
on the day following the execution and delivery of this Agreement; to
make no further amendment or any supplement to the Registration
Statements or to the Prospectus except as permitted herein; to advise
the Representatives, promptly after it receives notice thereof, of the
time when any amendment to either Registration Statement has been filed
or becomes effective or any supplement to the Prospectus or any amended
Prospectus has been filed and to furnish the Representatives with
copies thereof; to advise the Representatives, promptly after it
receives notice thereof, of the issuance by the Commission of any stop
order or of any order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus, of the suspension of the
qualification of the Stock for offering or sale in any jurisdiction, of
the initiation or threatening of any proceeding for any such purpose,
or of any request by the Commission for the amending or supplementing
of the Registration Statements or the Prospectus or for additional
information; and, in the event of the issuance of any stop order or of
any order preventing or suspending the use of any Preliminary
Prospectus or the Prospectus or suspending any such qualification, to
use promptly its best efforts to obtain its withdrawal;
(b) To furnish promptly to each of the Representatives and to
counsel for the Underwriters a signed copy of each of the Registration
Statements as originally filed with the Commission, and each amendment
thereto filed with the Commission, including all consents and exhibits
filed therewith;
(c) To deliver promptly to the Representatives in New York
City such number of the following documents as the Representatives
shall reasonably request: (i) conformed copies of the Registration
Statements as originally filed with the Commission and each amendment
thereto (in each case excluding exhibits other than this Agreement and
the computation of per share earnings) and (ii) each Preliminary
Prospectus, the Prospectus (not later than 10:00 A.M., New York City
time, of the day following the execution and delivery of this
Agreement) and any amended or supplemented Prospectus (not later than
10:00 A.M., New York City time, on the day following the date of such
amendment or supplement); and, if the delivery of a prospectus is
required at any time after the Effective Time of the Primary
Registration Statement in connection with the offering or sale of the
Stock (or any other securities relating thereto) and if at such time
any event shall have occurred as a result of which the Prospectus as
then amended or supplemented would include any untrue statement of a
material fact or omit to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under
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which they were made when such Prospectus is delivered, not misleading,
or, if for any other reason it shall be necessary to amend or
supplement the Prospectus in order to comply with the Securities Act,
to notify the Representatives and, upon their request, to prepare and
furnish without charge to each Underwriter and to any dealer in
securities as many copies as the Representatives may from time to time
reasonably request of an amended or supplemented Prospectus which will
correct such statement or omission or effect such compliance;
(d) To file promptly with the Commission any amendment to the
Registration Statements or the Prospectus or any supplement to the
Prospectus that may, in the judgment of the Company or the
Representatives, be required by the Securities Act or requested by the
Commission;
(e) Prior to filing with the Commission (i) any amendment to
either of the Registration Statements or supplement to the Prospectus
or (ii) any Prospectus pursuant to Rule 424 of the Rules and
Regulations, to furnish a copy thereof to the Representatives and
counsel for the Underwriters and obtain the consent of the
Representatives to the filing;
(f) As soon as practicable after the Effective Date of the
Primary Registration Statement, to make generally available to the
Company's security holders and to deliver to the Representatives an
earnings statement of the Company and its subsidiaries (which need not
be audited) complying with Section 11(a) of the Securities Act and the
Rules and Regulations (including, at the option of the Company, Rule
158);
(g) For a period of five years following the Effective Date of
the Primary Registration Statement, to furnish to the Representatives
copies of all materials furnished by the Company to its shareholders
and all public reports and all reports and financial statements
furnished by the Company to the principal national securities exchange
or automatic quotation system upon which the Common Stock may be listed
or quoted pursuant to requirements of or agreements with such exchange
or system or to the Commission pursuant to the Exchange Act or any rule
or regulation of the Commission thereunder;
(h) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify the Stock for
offering and sale under the securities laws of such jurisdictions in
the United States and Canada as the Representatives may request and to
comply with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be necessary
to complete the distribution of the Stock;
(i) For a period of 180 days from the date of the Prospectus,
not to, directly or indirectly (whether any transaction is to be
settled by delivery of Common Stock or other securities, in cash or
otherwise) (i) offer for sale, sell or otherwise dispose of (or enter
into any transaction or device which is designed to, or could be
expected to, result in the disposition or purchase by any person at any
time in the future of) any shares of Common Stock or securities
13
convertible into or exchangeable for Common Stock or substantially
similar securities (other than the Stock, shares of Common Stock
distributed to holders of Deluxe Common Stock pursuant to the exchange
offer described in the Prospectus and shares of Common Stock issued
pursuant to employee benefit plans, qualified stock option plans or
other employee compensation plans existing on the date hereof or under
currently outstanding options, warrants or rights), or (ii) sell or
grant options, rights or warrants with respect to any shares of Common
Stock or securities convertible into or exchangeable for Common Stock
or substantially similar securities, other than the grant of options
under option plans existing on the date hereof, without the prior
written consent of Xxxxxx Brothers Inc.; and to cause each officer and
director of the Company to furnish to the Representatives, prior to the
First Delivery Date, a letter or letters, in form and substance
satisfactory to counsel for the Underwriters as provided in Se ction
8(l) hereof, pursuant to which each such person shall agree for a
period of 180 days from the date of the Prospectus not to, directly or
indirectly (whether any transaction is to be settled by delivery of
Common Stock or other securities, in cash or otherwise) (i) offer for
sale, sell or otherwise dispose of (or enter into any transaction or
device which is designed to, or could be expected to, result in the
disposition or purchase by any person at any time in the future of) any
shares of Common Stock or securities convertible into or exchangeable
for Common Stock or substantially similar securities or (ii) sell or
grant options, rights or warrants with respect to any shares of Common
Stock or securities convertible into or exchangeable for Common Stock
or substantially similar securities, without the prior written consent
of Xxxxxx Brothers Inc.
Notwithstanding the foregoing, the Company may issue shares of
Common Stock or securities convertible into or exchangeable for Common
Stock without the prior consent of Xxxxxx Brothers Inc. pursuant to an
agreement by the Company to purchase, acquire or effect the merger of
another entity into the Company if in connection therewith each initial
transferee of such Common Stock or securities convertible into Common
Stock executes and delivers to the Company an agreement stating that,
without the prior written consent of Xxxxxx Brothers Inc., such
transferee will not, directly or indirectly, (1) offer for sale, sell
or otherwise dispose of (or enter into any transaction or device which
is designed to, or could be expected to, result in the disposition or
purchase by any person at any time in the future of) any such shares of
Common Stock or securities convertible into or exchangeable for Common
Stock transferred to such person in connection with such purchase,
acquisition or merger, or (2) sell or grant options , rights or
warrants with respect to such shares of Common Stock or securities
convertible into or exchangeable for Common Stock or substantially
similar securities for a period of 180 days from the date of the
Prospectus.
(j) Prior to the Effective Date of the Primary Registration
Statement, to apply for the listing of the Stock on the National Market
System and to use its best efforts to complete that listing, subject
only to official notice of issuance, prior to the First Delivery Date;
(k) To apply the net proceeds from the sale of the Stock being
sold by the Company as set forth in the Prospectus; and
14
(l) To take such steps as shall be necessary to ensure that
neither the Company nor any subsidiary shall become an "investment
company" within the meaning of such term under the Investment Company
Act of 1940 and the rules and regulations of the Commission thereunder.
7. Expenses. The Company and Deluxe, jointly and severally, agree to
pay (a) the costs incident to the authorization, issuance, sale and delivery of
the Stock and any taxes payable in that connection; (b) the costs incident to
the preparation, printing and filing under the Securities Act of the
Registration Statements and any amendments and exhibits thereto; (c) the costs
of distributing the Registration Statements as originally filed and each
amendment thereto and any post-effective amendments thereof (including, in each
case, exhibits), any Preliminary Prospectus, the Prospectus and any amendment or
supplement to the Prospectus, all as provided in this Agreement; (d) the costs
of reproducing and distributing this Agreement; (e) the costs of distributing
the terms of agreement relating to the organization of the underwriting
syndicate and selling group to the members thereof by mail, telex or other means
of communication; (f) the filing fees incident to securing any required review
by the National Associa tion of Securities Dealers, Inc. of the terms of sale of
the Stock; (g) any applicable listing or other fees; (h) the fees and expenses
of qualifying the Stock under the securities laws of the several jurisdictions
as provided in Section 6(h) of preparing, printing and distributing a Blue Sky
Memorandum (including related fees and expenses of counsel to the Underwriters);
and (i) all other costs and expenses incident to the performance of the
obligations of the Company and Deluxe under this Agreement; provided that,
except as provided in this Section 7 and in Section 13, the Underwriters shall
pay their own costs and expenses, including the costs and expenses of their
counsel, any transfer taxes on the Stock which they may sell and the expenses of
advertising any offering of the Stock made by the Underwriters.
8. Conditions of Underwriters' Obligations. The respective obligations
of the Underwriters hereunder are subject to the accuracy, when made and on each
Delivery Date, of the representations and warranties of the Company and Deluxe
contained herein, to the performance by the Company and Deluxe of their
respective obligations hereunder, and to each of the following additional terms
and conditions:
(a) The Rule 462(b) Registration Statement, if any, and the
Prospectus shall have been timely filed with the Commission in
accordance with Section 7(a); no stop order suspending the
effectiveness of either of the Registration Statements or any part
thereof shall have been issued and no proceeding for that purpose shall
have been initiated or threatened by the Commission; and any request of
the Commission for inclusion of additional information in either of the
Registration Statements or the Prospectus or otherwise shall have been
complied with.
(b) No Underwriter shall have discovered and disclosed to the
Company on or prior to such Delivery Date that either of the
Registration Statements or the Prospectus or any amendment or
supplement thereto contains any untrue statement of a fact which, in
the opinion of Xxxxxxx Xxxxxxx & Xxxxxxxx, counsel for the
Underwriters, is material or omits to state any
15
fact which, in the opinion of such counsel, is material and is required
to be stated therein or is necessary to made the statements therein not
misleading.
(c) The Company and Deluxe shall have furnished to counsel for
the Underwriters all documents and information that they may reasonably
request to enable them to pass upon all corporate proceedings and other
legal matters incident to the authorization, form and validity of this
Agreement, the Registration Statements and the Prospectus, and all
other legal matters relating to this Agreement and the transactions
contemplated hereby.
(d) Xxxxxx & Whitney LLP shall have furnished to the
Representatives their written opinion, as counsel to the Company,
addressed to the Underwriters and dated such Delivery Date, in form and
substance satisfactory to the Representatives, to the effect that:
(i) The Company and each of its United States
subsidiaries have been duly incorporated and are validly
existing as corporations in good standing under the laws of
their respective jurisdictions of incorporation, and have all
corporate power and authority necessary to own or hold their
respective properties and conduct the businesses in which they
are engaged as described in the Prospectus;
(ii) 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 on such Delivery Date) 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 the shares of capital stock
of each subsidiary of the Company registered as outstanding in
each Subsidiary's records have been duly and validly
authorized and issued and are fully paid, non-assessable and
(except as set forth in the Prospectus) are owned directly or
indirectly by the Company, and such counsel has no knowledge
of any liens, encumbrances, equities or claims upon the
capital stock of the subsidiaries;
(iii) The statements made in the Prospectus under the
caption "Description of Capital Stock", insofar as they
purport to constitute summaries of the terms of the Company's
Common Stock (including the Stock), constitute accurate
summaries of such Common Stock in all material respects.
(iv) There are no preemptive or other rights to
subscribe for or to purchase, nor any restriction upon the
voting or transfer of, any shares of the Stock pursuant to the
Company's charter or by-laws or any agreement or other
instrument known to such counsel;
(v) The Company and each of its United States
subsidiaries have good and marketable title in fee simple to
all real property owned by them, in each case free and
16
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 United States subsidiaries;
and all real property and buildings held under lease by the
Company and its United States 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 United States subsidiaries;
(vi) To such counsel's knowledge and other than as
set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property or
asset of the Company or any of its subsidiaries is the subject
which are required to be disclosed in the Prospectus;
(vii) The Primary Registration Statement was declared
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
effectiveness of either of the Registration Statements has
been issued and, to the knowledge of such counsel, no
proceeding for that purpose is pending or threatened by the
Commission;
(viii) The Registration Statements, as of their
respective Effective Dates, and the Prospectus, as of its
date, and any further amendments or supplements thereto, as of
their respective dates, made by the Company prior to such
Delivery Date (other than the financial statements and other
financial 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
Rules and Regulations;
(ix) The statements made in the Prospectus under the
caption "Business--Government Regulation," "Description of
Capital Stock" and "Agreements Between eFunds and Deluxe"
insofar as they purport to constitute summaries of the terms
of statutes, rules and regulations thereunder or contracts and
other documents constitute accurate summaries of the terms of
such statutes, rules and regulations, contracts and other
documents in all material respects;
(x) The statements contained in the Prospectus under
the caption "Certain United States Federal Income Tax
Consequences to Non-United States Holders", insofar as they
describe federal statutes, rules and regulations, constitute a
fair summary thereof;
17
(xi) To the best of such counsel's knowledge, there
are no contracts or other documents which are required to be
described in the Prospectus or filed as exhibits to the
Registration Statements by the Securities Act or by the Rules
and Regulations which have not been described or filed as
exhibits to the Registration Statements or incorporated
therein by reference as permitted by the Rules and
Regulations;
(xii) This Agreement has been duly authorized,
executed and delivered by the Company;
(xiii) The issue and sale of the shares of Stock
being delivered on such Delivery Date by the Company and the
compliance by the Company with all of the provisions of this
Agreement and the consummation of the transactions
contemplated hereby will not conflict with or result in a
breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known
to such counsel to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the properties or
assets of the Company or any of its subsidiaries is subject,
nor will such actions result in any violation of the
provisions of the charter or by-laws of the Company or any of
its subsidiaries or 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; and,
except for the registration of the Stock 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 Stock 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; and
(xiv) To such counsel's knowledge, there are no
contracts, agreements or understandings between the Company
and any person granting such person the right to require the
Company to file a registration statement under the Securities
Act with respect to any securities of the Company owned or to
be owned by such person or to require the Company to include
such securities in the securities registered pursuant to the
Registration Statements or in any securities being registered
pursuant to any other registration statement filed by the
Company under the Securities Act.
In giving the opinion referred to in Section 8(d)(v), such counsel may
state that no examination of record titles for the purpose of such
opinion has been made, and that they are relying upon a general review
of the titles of the Company and its subsidiaries, upon opinions of
local counsel and abstracts, reports and policies of title companies
rendered or issued at or subsequent to the
18
time of acquisition of such property by the Company or its
subsidiaries, upon opinions of counsel to the lessors of such property
and, in respect of matters of fact, upon certificates of officers of
the Company or its subsidiaries, provided that such counsel shall state
that they believe that both the Underwriters and they are justified in
relying upon such opinions, abstracts, reports, policies and
certificates. Such counsel shall also have furnished to the
Representatives a written statement, addressed to the Underwriters and
dated such Delivery Date, in form and substance satisfactory to the
Representatives, to the effect that (x) such counsel has acted as
counsel to the Company and Deluxe in connection with the preparation of
the Registration Statements, and (y) based on the foregoing, no facts
have come to the attention of such counsel which lead them to believe
that the Registration Statements, as of their respective Effective
Dates, contained any untrue statement of a material fact or omitted to
stat e any material fact required to be stated therein or necessary in
order 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 required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances
under which they were made, not misleading. The foregoing opinion and
statement may be qualified by a statement to the effect that such
counsel does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the
Registration Statements or the Prospectus except for the statements
made in the Prospectus under the captions "Description of Capital
Stock," "Business --Government Regulation," "Description of Capital
Stock," "Agreements Between eFunds and Deluxe" and "Certain United
States Federal Income Tax Consequences to Non-U.S. Holders", insofar as
such statements relate to the Stock and concern legal matters.
(e) Xxxxxx & Witney LLP, counsel for Deluxe shall have
furnished to the Representatives their written opinion, addressed to
the Underwriters and dated the First Delivery Date, in form and
substance reasonably satisfactory to the Representatives, to the effect
that:
(i) Deluxe has been duly incorporated and is validly
existing as a corporation in good standing under Minnesota
law; and
(ii) This Agreement has been duly authorized,
executed and delivered by Deluxe; the execution, delivery and
performance of this Agreement by Deluxe and the consummation
by Deluxe of the transactions contemplated hereby will not
conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any
statute, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument known to such
counsel to which Deluxe or any of its subsidiaries is a party
or by which Deluxe or any of its subsidiaries is bound or to
which any of the property or assets of Deluxe or any of its
subsidiaries is subject, nor will such actions result in any
violation of the charter or by-laws of Deluxe or any of its
subsidiaries or any statute or any order, rule or regulation
known to such counsel of any court or governmental agency or
body having jurisdiction over Deluxe or any of its
19
subsidiaries or the property or assets of Deluxe or any of its
subsidiaries; and, except for the registration of the Stock
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 Stock 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 Deluxe and the consummation of the transactions
contemplated hereby;
(f) With respect to the letter of Deloitte & Touche LLP
delivered to the Representatives concurrently with the execution of
this Agreement (the "initial letter"), the Company shall have furnished
to the Representatives a letter (the "bring-down letter") of such
accountants, addressed to the Underwriters and dated such Delivery Date
(i) confirming that they are independent public accountants within the
meaning of the Securities Act and are in compliance with the applicable
requirements relating to the qualification of accountants under Rule
2-01 of Regulation S-X of the Commission, (ii) stating, as of the date
of the bring-down letter (or, with respect to matters involving changes
or developments since the respective dates as of which specified
financial information is given in the Prospectus, as of a date not more
than five days prior to the date of the bring-down letter), the
conclusions and findings of such firm with respect to the financial
information and other matters covered by the initial letter and (iii)
confirming in all material respects the conclusions and findings set
forth in the initial letter.
(g) The Company shall have furnished to the Representatives a
certificate, dated such Delivery Date, of its Chairman of the Board,
its President or a Vice President and its chief financial officer
stating that:
(i) The representations, warranties and agreements of
the Company in Section 1 are true and correct as of such
Delivery Date; the Company has complied with all its
agreements contained herein; and the conditions set forth in
Section 8(a) have been fulfilled;
(ii) (A) Neither the Company nor any of its
subsidiaries has sustained since the date of the latest
audited financial statements included in the Prospectus any
loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance,
or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated
in the Prospectus or (B) since such date there has not been
any change in the capital stock or long-term debt of the
Company or any of its subsidiaries or any change, or any
development involving a prospective change, in or affecting
the general affairs, management, financial position,
stockholders' equity or results of operations of the Company
and its subsidiaries, otherwise than as set forth or
contemplated in the Prospectus; and
20
(iii) They have carefully examined the Registration
Statements and the Prospectus and, in their opinion (A) the
Registration Statements, as of their respective Effective
Dates, and the Prospectus, as of each of the Effective Dates,
did not include any untrue statement of a material fact and
did not omit to state any material fact required to be stated
therein or necessary to make the statements therein not
misleading, and (B) since the Effective Date of the Primary
Registration Statement, no event has occurred which should
have been set forth in a supplement or amendment to either of
the Registration Statements or the Prospectus.
(h) Deluxe shall have furnished to the Representatives a
certificate, dated such Delivery Date, of its Chairman of the Board,
its President or a Vice President and its chief financial officer
stating that:
(i) The representations, warranties and agreements of
Deluxe in Section 2 are true and correct as of such Delivery
Date; Deluxe has complied with all its agreements contained
herein; and the conditions set forth in Section 8(a) have been
fulfilled; and
(ii) They have carefully examined the Registration
Statements and the Prospectus and, in their opinion (A) the
Registration Statements, as of their respective Effective
Dates, and the Prospectus, as of each of the Effective Dates,
did not include any untrue statement of a material fact and
did not omit to state any material fact required to be stated
therein or necessary to make the statements therein not
misleading, and (B) since the Effective Date of the Primary
Registration Statement, no event has occurred which should
have been set forth in a supplement or amendment to either of
the Registration Statements or the Prospectus.
(i) (i) Neither the Company nor any of its subsidiaries shall
have sustained since the date of the latest audited financial
statements included in the Prospectus any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus or (ii) since such date there shall not
have been any change in the capital stock or long-term debt of the
Company or any of its subsidiaries or any change, or any development
involving a prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as set
forth or contemplated in the Prospectus, the effect of which, in any
such case described in clause (i) or (ii), is, in the judgment of the
Representatives, so material and adverse as to make it impracticable or
i nadvisable to proceed with the public offering or the delivery of the
Stock being delivered on such Delivery Date on the terms and in the
manner contemplated in the Prospectus.
(j) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in
securities generally on the New York Stock
21
Exchange or the American Stock Exchange or in the over-the-counter
market, or trading in any securities of the Company on any exchange or
in the over-the-counter market, shall have been suspended or minimum
prices shall have been established on any such exchange or such market
by the Commission, by such exchange or by any other regulatory body or
governmental authority having jurisdiction, (ii) a banking moratorium
shall have been declared by Federal or state authorities, (iii) the
United States shall have become engaged in hostilities, there shall
have been an escalation in hostilities involving the United States or
there shall have been a declaration of a national emergency or war by
the United States or (iv) there shall have occurred such a material
adverse change in general economic, political or financial conditions
(or the effect of international conditions on the financial markets in
the United States shall be such) as to make it, in the judgment of a
majority in interest of the several Underwriters, impracticable or
inadvisable to proceed with the public offering or delivery of the
Stock being delivered on such Delivery Date on the terms and in the
manner contemplated in the Prospectus.
(k) The National Market System shall have approved the Stock
for inclusion, subject only to official notice of issuance and evidence
of satisfactory distribution.
(l) The directors and executive officers of the Company listed
on Schedule 2 shall have entered into a written agreement in the form
of Annex A hereto (each such agreement, a "Lock-up Agreement"), and
executed originals of each Lock-up Agreement shall have been delivered
to the Representatives.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance satisfactory to counsel
for the Underwriters.
9. Indemnification and Contribution.
(a) The Company and Deluxe, jointly and severally, shall indemnify and
hold harmless each Underwriter, its officers and employees and each person, if
any, who controls any Underwriter within the meaning of the Securities Act, from
and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof (including, but not limited to, any loss, claim,
damage, liability or action relating to purchases and sales of Stock), to which
that Underwriter, officer, employee or controlling person may become subject,
under the Securities Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) any untrue statement or
alleged untrue statement of a material fact contained (A) in any Preliminary
Prospectus, either of the Registration Statements or the Prospectus, or in any
amendment or supplement thereto, (B) in any information provided to investors by
the Company in connection with the marketing of the offering of the Stock
("Marketing Inf ormation"), including any roadshow or investor presentations
made to investors by the Company (whether in person or electronically), or (C)
in any blue sky application or other document prepared or executed by the
Company (or based upon any written information furnished by the Company)
specifically for the purpose of qualifying any or all of the Stock under the
22
securities laws of any state or other jurisdiction (any such application,
document or information being hereinafter called a "Blue Sky Application"), (ii)
the omission or alleged omission to state in any Preliminary Prospectus, either
of the Registration Statements or the Prospectus, or in any amendment or
supplement thereto, in any Marketing Information or in any Blue Sky Application
any material fact required to be stated therein or necessary to make the
statements therein not misleading or (iii) any act or failure to act, or any
alleged act or failure to act, by any Underwriter in connection with, or
relating in any manner to, the Stock or the offering contemplated hereby, and
which is included as part of or referred to in any loss, claim, damage,
liability or action arising out of or based upon matters covered by clause (i)
or (ii) above (provided that the Company and Deluxe shall not be liable in the
case of any matter covered by this clause (iii) to the extent that it is
determined in a final judgement by a court of competent jurisdiction that such
loss, claim, damage, liability or action resulted directly from any such act or
failure to act undertaken or omitted to be taken by such Underwriter through its
gross negligence or wilful misconduct), and shall reimburse each Underwriter and
each such officer, employee and controlling person promptly upon demand for any
legal or other expenses reasonably incurred by that Underwriter, officer,
employee or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company and Deluxe shall
not be liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, any untrue statement or
alleged untrue statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any such
amendment or supplement, i nany Marketing Information or in any Blue Sky
Application in reliance upon and in conformity with the written information
furnished to the Company through the Representatives by or on behalf of any
Underwriter specifically for inclusion therein and described in Section 9 (e);
provided further, that the foregoing indemnity agreement with respect to any
Preliminary Prospectus shall not inure to the benefit of any Underwriter who it
shall be established failed to deliver a Prospectus (as then amended or
supplemented, provided by the Company to the several Underwriters in the
requisite quantity and on a timely basis to permit proper delivery on or prior
to the Closing Date) to the person asserting any losses, claims, damages,
liabilities, and judgments caused by any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus, or caused
by any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading, if
such material misstatement or omission or alleged material misstatement or
omission was cured in such Prospectus and such Prospectus was required by law to
be delivered at or prior to the written confirmation of such sale to such
person. The foregoing indemnity agreement is in addition to any liability which
the Company and Deluxe may otherwise have to any Underwriter or to any officer,
employee or controlling person of that Underwriter.
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Company and Deluxe, its officers and employees, each of its
directors and each person, if any, who controls the Company and Deluxe within
the meaning of the Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which the
Company and Deluxe or any such director, officer or controlling person may
become subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based upon, (i)
23
any untrue statement or alleged untrue statement of a material fact contained
(A) in any Preliminary Prospectus, either of the Registration Statements or the
Prospectus, or in any amendment or supplement thereto, (B) any Marketing
Information or (C) in any Blue Sky Application or (ii) the omission or alleged
omission to state in any Preliminary Prospectus, either of the Registration
Statements or the Prospectus, or in any amendment or supplement thereto, in any
Marketing Information or in any Blue Sky Application any material fact required
to be stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with the written information furnished to the Company or Deluxe
through the Representatives by or on behalf of that Underwriter specifically for
inclusion therein and described in Section 9 (e), and shall reimburse the
Company, D eluxe and any such director, officer or controlling person for any
legal or other expenses reasonably incurred by the Company, Deluxe or any such
director, officer or controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action as such expenses are incurred. The foregoing indemnity agreement is in
addition to any liability which any Underwriter may otherwise have to the
Company and Deluxe or any such director, officer or controlling person.
(c) Promptly after receipt by an indemnified party under this Section 9
of notice of any claim or the commencement of any action, the indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under this Section 9, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have under this Section 9 except to the extent it has been materially
prejudiced by such failure and, provided further, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to
an indemnified party otherwise than under this Section 9. If any such claim or
action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notif ied indemnifying party, to assume the defense thereof with
counsel satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 9 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
the Representatives shall have the right to employ counsel to represent jointly
the Representatives and those other Underwriters and their respective officers,
employees and controlling persons who may be subject to liability arising out of
any claim in respect of which indemnity may be sought by the Underwriters
against the Company or Deluxe under this Section 9 if, in the reasonable
judgment of the Representatives, it is advisable for the Representatives and
those Underwriters, officers, employees and co ntrolling persons to be jointly
represented by separate counsel because the Representatives shall have been
advised by counsel that there may be one or more legal defenses available to
them which are different from or additional to those available to Deluxe or the
Company, and in that event the fees and expenses of such separate counsel shall
be paid by the Company or Deluxe. No indemnifying party shall (i) without the
prior written consent of the indemnified parties (which consent shall not be
24
unreasonably withheld), settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding, or (ii) be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment of the plaintiff in any such action, the
indemnifying party agrees to indemnify and hold harmless any indemnified party
from and against any loss of liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 9 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 9(a) in respect of any loss, claim, damage or liability, or any
action in respect thereof, referred to therein, then each indemnifying party
shall, in lieu of indemnifying such indemnified party, contribute to the amount
paid or payable by such indemnified party as a result of such loss, claim,
damage or liability, or action in respect thereof, (i) in such proportion as
shall be appropriate to reflect the relative benefits received by the Company
and Deluxe on the one hand and the Underwriters on the other from the offering
of the Stock or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company and Deluxe on the one hand and the Underwriters on the
other with res pect to the statements or omissions which resulted in such loss,
claim, damage or liability, or action in respect thereof, as well as any other
relevant equitable considerations. The relative benefits received by the Company
and Deluxe, on the one hand and the Underwriters on the other with respect to
such offering shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Stock purchased under this Agreement (before
deducting expenses) received by the Company and Deluxe, on the one hand, and the
total underwriting discounts and commissions received by the Underwriters with
respect to the shares of the Stock purchased under this Agreement, on the other
hand, bear to the total gross proceeds from the offering of the shares of the
Stock under this Agreement, in each case as set forth in the table on the cover
page of the Prospectus. The relative fault shall be determined by reference to
whether the untrue or alleged untrue statement of a material fact or omission or
alleg ed omission to state a material fact relates to information supplied by
the Company or the Underwriters, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission. For purposes of the preceding two sentences, the net
proceeds deemed to be received by the Company shall be deemed to be also for the
benefit of Deluxe and information supplied by the Company shall also be deemed
to have been supplied by Deluxe. The Company, Deluxe and the Underwriters agree
that it would not be just and equitable if contributions pursuant to this
Section 9(d) were to be 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 into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect thereof,
referred to above in t his Section 9(d) shall be deemed to include, for purposes
of this Section 9(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating
25
or defending any such action or claim. Notwithstanding the provisions of this
Section 9(d), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Stock underwritten by
it and distributed to the public was offered to the public exceeds the amount of
any damages which such Underwriter has otherwise paid or become liable to pay by
reason of any 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 as provided in this Section 9(d) are
several in proportion to their respective underwriting obligations and not
joint.
(e) The Underwriters severally confirm that the statements with respect
to the public offering of the Stock set forth on the cover page of, and under
the caption "Underwriting" in, the Prospectus are correct and constitute the
only information furnished in writing to the Company by or on behalf of the
Underwriters specifically for inclusion in the Registration Statements and the
Prospectus.
10. Directed Share Program.
It is understood that approximately 300,000 shares of the Firm Stock
("Directed Shares") will initially be reserved by the Underwriters for offer and
sale to certain directors and officers of the Company and other persons with
whom the Company has an established business relationship ("Directed Share
Participants") upon the terms and conditions set forth in the Prospectus and in
accordance with the rules and regulations of the National Association of
Securities Dealers, Inc. (the "Directed Share Program"). Under no circumstances
will any Underwriter be liable to the Company or to any Directed Share
Participant for any action taken or omitted to be taken in good faith in
connection with such Directed Share Program. To the extent that any Directed
Shares are not affirmatively reconfirmed for purchase by any Directed Share
Participant on or immediately after the date of this Agreement, such Directed
Shares may be offered to the public as part of the public offering contemplated
hereby.
The Company and Deluxe agree to pay all fees and disbursements incurred
by the Underwriters in connection with the Directed Share Program, including
counsel fees and any stamp duties or other taxes incurred by the Underwriters in
connection with the Directed Share Program.
In connection with the offer and sale of the Directed Shares, the
Company and Deluxe agree, promptly upon a request in writing, to indemnify and
hold harmless the Underwriters from and against any loss, claim, damage,
expense, liability or action which (i) arises out of, or is based upon, any
untrue statement or alleged untrue statement of a material fact contained in any
material prepared by or with the approval of the Company or Deluxe for
distribution to Directed Share Participants in connection with the Directed
Share Program or 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, (ii) arises out of the failure of any Directed Share Program
participant to pay for and accept delivery of Directed Shares that the Directed
Share Participant agreed to purchase or (iii) is otherwise related to
26
the Directed Share Program, other than losses, claims, damages or liabilities
(or expenses relating thereto) that are finally judicially determined to have
resulted directly from the bad faith or gross negligence of such Underwriter.
11. Defaulting Underwriters.
If, on either Delivery Date, any Underwriter defaults in the
performance of its obligations under this Agreement, the remaining
non-defaulting Underwriters shall be obligated to purchase the Stock which the
defaulting Underwriter agreed but failed to purchase on such Delivery Date in
the respective proportions which the number of shares of the Firm Stock set
opposite the name of each remaining non-defaulting Underwriter in Schedule 1
hereto bears to the total number of shares of the Firm Stock set opposite the
names of all the remaining non-defaulting Underwriters in Schedule 1 hereto;
provided, however, that the remaining non-defaulting Underwriters shall not be
obligated to purchase any of the Stock on such Delivery Date if the total number
of shares of the Stock which the defaulting Underwriter or Underwriters agreed
but failed to purchase on such date exceeds 9.09% of the total number of shares
of the Stock to be purchased on such Delivery Date, and any remaining
non-defaulting Underwriter shall not be o bligated to purchase more than 110% of
the number of shares of the Stock which it agreed to purchase on such Delivery
Date pursuant to the terms of Section 3. If the foregoing maximums are exceeded,
the remaining non-defaulting Underwriters, or those other underwriters
satisfactory to the Representatives who so agree, shall have the right, but
shall not be obligated, to purchase, in such proportion as may be agreed upon
among them, all the Stock to be purchased on such Delivery Date. If the
remaining Underwriters or other underwriters satisfactory to the Representatives
do not elect to purchase the shares which the defaulting Underwriter or
Underwriters agreed but failed to purchase on such Delivery Date, this Agreement
(or, with respect to the Second Delivery Date, the obligation of the
Underwriters to purchase, and of the Company to sell, the Option Stock) shall
terminate without liability on the part of any non-defaulting Underwriter or the
Company or Deluxe, except that the Company and Deluxe will cont inue to be
liable for the payment of expenses to the extent set forth in Sections 7 and 13.
As used in this Agreement, the term "Underwriter" includes, for all purposes of
this Agreement unless the context requires otherwise, any party not listed in
Schedule 1 hereto who, pursuant to this Section 11, purchases Firm Stock which a
defaulting Underwriter agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting Underwriter of any
liability it may have to the Company and Deluxe for damages caused by its
default. If other underwriters are obligated or agree to purchase the Stock of a
defaulting or withdrawing Underwriter, either the Representatives or the Company
may postpone the First Delivery Date for up to seven full business days in order
to effect any changes that in the opinion of counsel for the Company or counsel
for the Underwriters may be necessary in the Registration Statement, the
Prospectus or in any other document or arrangement.
12. Termination. The obligations of the Underwriters hereunder may be
terminated by the Representatives by notice given to and received by the Company
and Deluxe prior to delivery of
27
and payment for the Firm Stock if, prior to that time, any of the events
described in Sections 8(i) or 8(j) shall have occurred or if the Underwriters
shall decline to purchase the Stock for any reason permitted under this
Agreement.
13. Reimbursement of Underwriters' Expenses. If (a) the Company shall
fail to tender the Stock for delivery to the Underwriters for any reason
permitted under this Agreement, or (b) the Underwriters shall decline to
purchase the Stock for any reason permitted under this Agreement (including the
termination of this Agreement pursuant to Section 12), the Company and Deluxe
shall reimburse the Underwriters for the fees and expenses of their counsel and
for such other out-of-pocket expenses as shall have been incurred by them in
connection with this Agreement and the proposed purchase of the Stock, and upon
demand the Company and Deluxe shall pay the full amount thereof to the
Representatives. If this Agreement is terminated pursuant to Section 11 by
reason of the default of one or more Underwriters, neither the Company nor
Deluxe shall be obligated to reimburse any defaulting Underwriter on account of
those expenses.
14. Notices, etc. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by
mail, telex or facsimile transmission to Xxxxxx Brothers Inc., Three
World Financial Center, New York, New York 10285, Attention: Syndicate
Department (Fax: 000-000-0000);
(b) if to the Company, shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth
in the Primary Registration Statement, Attention: General Counsel (Fax:
000-000-0000);
(c) if to Deluxe, shall be delivered or sent by mail, telex or
facsimile transmission to General Counsel (Fax: 000-000-0000);
provided, however, that any notice to an Underwriter pursuant to Section 9(c)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Representatives, which address will be supplied to any other party hereto by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company and
Deluxe shall be entitled to act and rely upon any request, consent, notice or
agreement given or made on behalf of the Underwriters by Xxxxxx Brothers Inc. on
behalf of the Representatives.
15. Persons Entitled to Benefit of Agreement. This Agreement shall
inure to the benefit of and be binding upon the Underwriters, the Company,
Deluxe and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
(A) the representations, warranties, indemnities and agreements of the Company
and Deluxe contained in this Agreement shall also be deemed to be for the
benefit of the officers and
28
employees of each Underwriter and the person or persons, if any, who control
each Underwriter within the meaning of Section 15 of the Securities Act and (B)
the indemnity agreement of the Underwriters contained in Section 9(b) of this
Agreement shall be deemed to be for the benefit of directors, officers and
employees of the Company and Deluxe and any person controlling the Company and
Deluxe within the meaning of Section 15 of the Securities Act. Nothing in this
Agreement is intended or shall be construed to give any person, other than the
persons referred to in this Section 15, any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision contained herein.
16. Survival. The respective indemnities, representations, warranties
and agreements of the Company, Deluxe and the Underwriters contained in this
Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement, shall survive the delivery of and payment for the Stock and shall
remain in full force and effect, regardless of any investigation made by or on
behalf of any of them or any person controlling any of them.
17. Definition of the Terms "Business Day" and "Subsidiary". For
purposes of this Agreement, "business day" means any day on which the New York
Stock Exchange, Inc. is open for trading and "subsidiary" has the meaning set
forth in Rule 405 of the Rules and Regulations.
18. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of New York.
19. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
20. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
29
If the foregoing correctly sets forth the agreement among the Company,
Deluxe and the Underwriters, please indicate your acceptance in the space
provided for that purpose below.
Very truly yours,
eFUNDS CORPORATION
By
-----------------------------------
[Insert title of person executing
agreement]
DELUXE CORPORATION
By
-----------------------------------
[Insert title of person executing
agreement]
Accepted:
XXXXXX BROTHERS INC.
BEAR, XXXXXXX & CO. INC.
FAC/EQUITIES, A DIVISION OF
FIRST ALBANY CORPORATION
XXXX X. XXXXXXX & COMPANY, INCORPORATED
For themselves and as Representatives
of the several Underwriters named
in Schedule 1 hereto
By XXXXXX BROTHERS INC.
By
-----------------------------
Authorized Representative
SCHEDULE 1
Number of
Underwriters Shares
------------ ---------
Xxxxxx Brothers Inc. .......................................
Bear, Xxxxxxx & Co. Inc. ...................................
FAC/Equities, a division
of First Albany Corporation .............................
Xxxx X. Xxxxxxx & Company, Incorporated ....................
----------
Total ......................................................
==========
SCHEDULE 2
Name of Officers and Directors
------------------------------
[Xxxx X. Xxxxxxxxx
Xxxx X. Xxxxxxx Xx.
Xxxxxx Xxxxx
Xxxxxx X. Xxxxxxx
Xxxx X. Xxxxx III
Xxxx Xxxxxxxx
Xxxxx X. Xxxxxx
Xxxx X. XxXxxxx
Xxxx X. Xxxxxx
Xxxxxxxx X. Xxxxxx]
ANNEX A
June __, 2000
Xxxxxx Brothers Inc.
Bear, Xxxxxxx & Co. Inc.
FAC/Equities, a division of
First Albany Corporation
Xxxx X. Xxxxxxx & Company, Incorporated
c/x Xxxxxx Brothers Inc.
Three World Financial Center
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
The undersigned have been informed that eFunds Corporation (the
"Company") proposes to issue 6,250,000 shares of its common stock (the
"Shares"). The undersigned have been informed that the Company has prepared a
preliminary prospectus regarding the shares and will enter into an underwriting
agreement with respect to the Shares (the "Underwriting Agreement") with Xxxxxx
Brothers Inc., Bear, Xxxxxxx & Co. Inc., FAC/Equities, a division of First
Albany Corporation and Xxxx X. Xxxxxxx & Company, Incorporated, as
representatives on behalf of the underwriters named in such Underwriting
Agreement (the "Underwriters").
To facilitate the sale of the Shares to be purchased thereunder and in
consideration of the Underwriters entering into the Underwriting Agreement, the
undersigned hereby irrevocable confirms, covenants and agrees for the benefit of
the Company and the Underwriters and for a period of 180 days from the date
hereof, that the undersigned will not, directly or indirectly (whether any
transaction is to be settled by delivery of the Company's common stock or other
securities, in cash or otherwise) (i) offer for sale, sell or otherwise dispose
of (or enter into any transaction or device which is designed to, or could be
expected to, result in the disposition or purchase by any person at any time in
the future of) any shares of the Company's common stock or securities
convertible into or exchangeable for the Company's common stock or substantially
similar securities or (ii) sell or grant options, rights or warrants with
respect to any shares of the Company's common stock or securities convertible
into or exchangeabl e for the Company's common stock or substantially similar
securities, without the prior written consent of Xxxxxx Brothers Inc.
Notwithstanding the immediately preceding paragraph, this agreement
shall not prohibit (a) a bona fide gift or gifts, provided that the undersigned
provides written notice of such gift or gifts to Xxxxxx Brothers Inc. and the
donee or donees thereof agree in writing to be bound by the restrictions set
forth herein; (b) transfers upon the death of the undersigned to his or her
executors, administrators, testamentary trustees, legatees or beneficiaries,
provided that, in each case, any such transferee shall be bound by the
provisions of this agreement and (c) transfers made by the undersigned to a
trust or custodianship the beneficiaries of which include the undersigned, his
or her spouse or his or her descendants (biological or
2
adoptive), provided that the transferee or transferees agree in writing to be
bound by the restrictions set forth herein.
The undersigned acknowledges and agrees that this agreement shall be
binding upon and inure to the benefit of the successors and assigns of the
undersigned, the Company and the Underwriters.
Very truly yours,
