EXHIBIT 1.1
DRAFT
▇▇▇▇▇▇ INTERNATIONAL, INC.
_______SHARES
COMMON STOCK
($.01 PAR VALUE)
UNDERWRITING AGREEMENT
______, 1997
▇.▇. ▇▇▇▇▇▇▇ & SONS, INC.
▇▇▇▇▇▇ GULL ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ INC.
As Representatives of the Several Underwriters
c/o ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
The undersigned, ▇▇▇▇▇▇ International, Inc., a Delaware corporation (the
"Company") and the persons listed on Schedule I hereto (the "Selling
Shareholders"), hereby address you as the representatives (the
"Representatives") of each of the persons, firms and corporations listed on
Schedule II hereto (collectively, the "Underwriters") and hereby confirm their
agreement with the several Underwriters as follows:
1. DESCRIPTION OF SHARES. The Company proposes to issue and sell to the
Underwriters ___ shares of its Common Stock, par value $.01 per share, and the
Selling Shareholders propose to sell to the Underwriters a total of __ shares of
the Company's Common Stock, par value $0.01 per share, as set forth on Schedule
I hereto (such __ shares of Common Stock are herein referred to as the "Firm
Shares"). Solely for the purpose of covering over-allotments in the sale of the
Firm Shares, the Company and the Selling Shareholders further propose to grant
to the Underwriters the right to purchase up to an additional 15% of Firm Shares
of the Company Common Stock (the "Option Shares"), as provided in Section 3 of
this Agreement. The Firm Shares and the Option Shares are herein sometimes
referred to as the "Shares" and are more fully described in the Prospectus
hereinafter defined.
2. PURCHASE, SALE AND DELIVERY OF FIRM SHARES. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company agrees and each Selling
Shareholder agrees, severally and not jointly, to sell to the Underwriters, and
each such Underwriter agrees, severally and not jointly, (a) to purchase from
the Company and from each of the Selling Shareholders, pro rata, at a purchase
price of $__ per share, the number of Firm Shares set forth opposite the name of
such Underwriter in Schedule II hereto and (b) to purchase from the Company and
the Selling Shareholders any additional number of Option Shares which such
Underwriter may become obligated to purchase pursuant to Section 3 hereof.
The Company and the Selling Shareholders will deliver definitive
certificates for the Firm Shares at the office of ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc., ▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ("▇▇▇▇▇▇▇' Office"), or such other place as you
and the Company may mutually agree upon, for the accounts of the Underwriters
against payment to the Company and the Selling Shareholders of the purchase
price for the Firm Shares sold by them to the several Underwriters by wire
transfer in immediately available funds to
bank accounts designated by the Company and Selling Shareholders, respectively.
The closing shall take place at ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other place as may be agreed upon
between you and the Company (the "Place of Closing"), at 10:00 a.m., St. Louis
time, on the third (fourth, if pricing occurs after 3:30 p.m. St. Louis time)
full business day following the date of this Agreement, or at such other time
and date as you and the Company may agree, such time and date of payment and
delivery being herein called the "Closing Date."
The certificates for the Firm Shares so to be delivered will be made
available to you for inspection at ▇▇▇▇▇▇▇' Office (or such other place as you
and the Company may mutually agree upon) at least one full business day prior to
the Closing Date and will be in such names and denominations as you may request
at least two full business days prior to the Closing Date.
It is understood that an Underwriter, individually, may (but shall
not be obligated to) make payment on behalf of the other Underwriters whose
checks shall not have been received prior to the Closing Date for Shares to be
purchased by such Underwriter. Any such payment by an Underwriter shall not
relieve the other Underwriters of any of their obligations hereunder.
It is understood that the Underwriters propose to offer the Shares
to the public upon the terms and conditions set forth in the Registration
Statement hereinafter defined.
3. PURCHASE, SALE AND DELIVERY OF THE OPTION SHARES. The Company and the
Selling Shareholders hereby grant options to the Underwriters to purchase from
them on a pro rata basis up to __ and __ Option Shares, respectively, on the
same terms and conditions as the Firm Shares; provided, however, that such
options may be exercised only for the purpose of covering any over-allotments
which may be made by them in the sale of the Firm Shares. No Option Shares shall
be sold or delivered unless the Firm Shares previously have been, or
simultaneously are, sold and delivered.
The options are exercisable on behalf of the several Underwriters by
you, as Representatives, at any time, and from time to time, before the
expiration of 30 days from the date of this Agreement, for the purchase of all
or part of the Option Shares covered thereby, by notice given by you to the
Company and the Selling Shareholders in the manner provided in Section 13
hereof, setting forth the number of Option Shares as to which the Underwriters
are exercising the options, and the date of delivery of said Option Shares,
which date shall not be more than five (5) business days after such notice
unless otherwise agreed to by the parties. You may terminate the options at any
time, as to any unexercised portion thereof, by giving written notice to the
Company and the Selling Shareholders to such effect.
You, as Representatives, shall make such allocation of the Option
Shares among the Underwriters as may be required to eliminate purchases of
fractional Shares.
Delivery of the Option Shares with respect to which the options
shall have been exercised shall be made to or upon your order at ▇▇▇▇▇▇▇' Office
(or at such other place as you and the Company may mutually agree upon), against
payment by you of the per share purchase price to the Company and the Selling
Shareholders by wire transfer in immediately available funds to a bank account
designated by the Company and Selling Shareholders, respectively. Such payment
and delivery shall be made at 10:00 a.m., St. Louis time, on the date designated
in the notice given by you as above provided for, unless some other date and
time are agreed upon, which date and time of payment and delivery are called the
"Option Closing Date." The certificates for the Option Shares so to be delivered
will be made available to you for inspection at ▇▇▇▇▇▇▇' Office at least one
full business day prior to the Option Closing Date and will be in such names
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and denominations as you may request at least two (2) full business days prior
to the Option Closing Date. On the Option Closing Date, the Company and the
Selling Shareholders shall provide the Underwriters such representations,
warranties, opinions and covenants with respect to the Option Shares as are
required to be delivered on the Closing Date with respect to the Firm Shares.
4. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY AND THE
SELLING SHAREHOLDERS.
(a) The Company represents and warrants to and agrees with each
Underwriter that:
(i) A registration statement (Registration No. 333-______ ) on
Form S-1 with respect to the Shares, including a preliminary prospectus, and
such amendments to such registration statement as may have been required to the
date of this Agreement, has been carefully prepared by the Company pursuant to
and in conformity with the requirements of the Securities Act of 1933, as
amended (the "Act"), and the Rules and Regulations (the "Rules and Regulations")
of the Securities and Exchange Commission (the "Commission") thereunder and has
been filed with the Commission under the Act. Copies of such registration
statement, including any amendments thereto, each related preliminary prospectus
(meeting the requirements of Rule 430 or 430A of the Rules and Regulations)
contained therein, the exhibits, financial statements and schedules have
heretofore been delivered by the Company to you. If such registration statement
has not become effective under the Act, a further amendment to such registration
statement, including a form of final prospectus, necessary to permit such
registration statement to become effective will be filed promptly by the Company
with the Commission. If such registration statement has become effective under
the Act, a final prospectus containing information permitted to be omitted at
the time of effectiveness by Rule 430A of the Rules and Regulations will be
filed promptly by the Company with the Commission in accordance with Rule 424(b)
of the Rules and Regulations. The term "Registration Statement" as used herein
means the registration statement as amended at the time it becomes or became
effective under the Act (the "Effective Date"), including financial statements
and all exhibits and, if applicable, the information deemed to be included by
Rule 430A of the Rules and Regulations. The term "Prospectus" as used herein
means (i) the prospectus as first filed with the Commission pursuant to Rule
424(b) of the Rules and Regulations, or (ii) if no such filing is required, the
form of final prospectus included in the Registration Statement at the Effective
Date, or (iii) if a Term Sheet or Abbreviated Term Sheet (as such terms are
defined in Rules 434(b) and 434(c), respectively, of the Rules and Regulations)
is filed with the Commission pursuant to Rule 424(b)(7) of the Rules and
Regulations, the Term Sheet or Abbreviated Term Sheet and the last Preliminary
Prospectus filed with the Commission prior to the time the Registration
Statement became effective, taken together. The term "Preliminary Prospectus" as
used herein shall mean a preliminary prospectus as contemplated by Rule 430 or
430A of the Rules and Regulations included at any time in the Registration
Statement.
(ii) The Commission has not issued, and is not to the
knowledge of the Company threatening to issue, an order preventing or suspending
the use of any Preliminary Prospectus or the Prospectus nor instituted
proceedings for that purpose. Each Preliminary Prospectus at its date of issue,
the Registration Statement and the Prospectus and any amendments or supplements
thereto contains or will contain, as the case may be, all statements which are
required to be stated therein by, and in all material respects conform or will
conform, as the case may be, to the requirements of, the Act and the Rules and
Regulations. Neither the Registration Statement nor any amendment thereto, as of
the applicable effective date, and neither the Prospectus nor any supplement
thereto contains or will contain, as the case may be, any untrue statement of a
material fact or omits or will omit to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were
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made, not misleading; provided, however, that the Company makes no
representation or warranty as to information contained in or omitted from the
Registration Statement or the Prospectus, or any such amendment or supplement,
in reliance upon, and in conformity with, written information furnished to the
Company by or on behalf of the Underwriters specifically for use in the
preparation thereof.
(iii) The filing of the Registration Statement and the
execution and delivery of this Agreement have been duly authorized by the Board
of Directors of the Company; this Agreement constitutes a valid and legally
binding obligation of the Company enforceable in accordance with its terms
(except to the extent the enforceability of the indemnification and contribution
provisions of Section 7 hereof may be limited by public policy considerations as
expressed in the Act as construed by courts of competent jurisdiction, and
except as enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium and other laws affecting creditors' rights generally
and by general principles of equity); the issue and sale of the Shares by the
Company and the performance of this Agreement and the consummation of the
transactions herein contemplated will not result in a violation of the Company's
Certificate of Incorporation or Bylaws or result in a breach or violation of any
of the terms and provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any properties or
assets of the Company or any of its subsidiaries under any statute, or under any
indenture, mortgage, deed of trust, note, loan agreement, sale and leaseback
arrangement or other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which any of them is bound or to which any of the
properties or assets of the Company or any of its subsidiaries is subject, 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 their properties,
except to such extent as does not materially adversely affect the business of
the Company and its subsidiaries taken as a whole; no consent, approval,
authorization, order, registration or qualification of or with any court or
governmental agency or body is required for the consummation of the transactions
herein contemplated, except such as may be required by the National Association
of Securities Dealers, Inc. (the "NASD") or under the Act or Rules and
Regulations or any state securities laws.
(iv) Except as described in the Prospectus, 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. Except as contemplated in the Prospectus,
subsequent to the respective dates as of which information is given in the
Registration Statement and the Prospectus, the Company and its subsidiaries
taken as a whole have not incurred any material liabilities or material
obligations, direct or contingent, other than in the ordinary course of
business, or entered into any material transactions not in the ordinary course
of business, and there has not been any material change in the capital stock or
long-term debt of the Company and its subsidiaries taken as a whole or any
material adverse change in the condition (financial or other), net worth,
business, affairs, management, prospects or results of operations of the Company
and its subsidiaries taken as a whole. The Company and its subsidiaries have
filed all necessary federal, state and foreign income and franchise tax returns
and paid all taxes shown as due thereon; all tax liabilities are adequately
provided for on the books of the Company and its subsidiaries except to such
extent as would not materially adversely affect the business of the Company and
its subsidiaries taken as a whole; the Company and its subsidiaries have made
all necessary payroll tax payments and are current and up-to-date as of the date
of this Agreement; and the Company and its subsidiaries have no knowledge of any
tax proceeding or action pending or threatened against the Company or its
subsidiaries which might materially adversely affect their business or property.
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(v) Except as described in the Prospectus, there is not now
pending or, to the knowledge of the Company or any of its subsidiaries, or
threatened or contemplated, any action, suit or proceeding to which the Company
or any of its subsidiaries is a party before or by any court or public,
regulatory or governmental agency or body which might be expected to result
(individually or in the aggregate) in any material adverse change in the
condition (financial or other), business or prospects of the Company and its
subsidiaries taken as a whole, or might be expected to materially and adversely
affect (individually or in the aggregate) the properties or assets thereof.
(vi) The Company has duly and validly authorized capital stock
as described in the Prospectus; all outstanding shares of Common Stock of the
Company and the Shares conform, or when issued will conform, to the description
thereof in the Registration Statement and the Prospectus and have been, or, when
issued and paid for will be, duly authorized, validly issued, fully paid and
nonassessable; and the issuance of the Shares to be purchased from the Company
hereunder is not subject to preemptive rights. All offers and sales of the
securities of the Company during the past three (3) years were at all relevant
times duly registered or exempt from the registration requirements of the Act
and were duly registered or the subject of an exemption from the registration
requirements of applicable state securities laws. Except as set forth in the
Prospectus, the Company does not have outstanding, and at the Closing Date, will
not have outstanding, any options to purchase, or any rights or warrants to
subscribe for, or any securities or obligations convertible into, or any
contracts, or commitments to issue or sell any shares of Common Stock or any
such warrants, convertible securities or obligations. Except as disclosed in the
Prospectus, there are no contracts, agreements or understandings between the
Company and any person granting such person the rights to require the Company to
file a registration statement under the 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 Statement or in any securities being registered pursuant to any
other registration statement filed by the Company under the Act.
(vii) The Company and its subsidiaries have been duly
incorporated and are validly existing as corporations in good standing under the
laws of the states or other jurisdictions in which they are incorporated, with
full power and authority (corporate and other) to own, lease and operate their
properties and conduct their businesses as described in the Registration
Statement; the Company and its subsidiaries are duly qualified to do business as
foreign corporations in good standing in each state or other jurisdiction in
which their ownership or leasing of property or conduct of business legally
requires such qualification, except where the failure to be so qualified would
not have a material adverse effect on the ability of the Company and its
subsidiaries to conduct its or their business as described in the Registration
Statement; and the outstanding shares of capital stock of the Company's
subsidiaries have been duly authorized and validly issued, are fully paid and
nonassessable and are owned by the Company free and clear of any mortgage,
pledge, lien, encumbrance, charge or adverse claim and are not the subject of
any agreement or understanding with any person; no options, warrants or other
rights to purchase, agreement or other obligations to issue or other rights to
convert any obligations into shares of capital stock or ownership interests in
the subsidiaries are outstanding.
(viii) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, the accounting firm which has
certified the financial statements filed with the Commission as a part of the
Registration Statement, is an independent public accounting firm within the
meaning of the Act and the Rules and Regulations.
(ix) The consolidated financial statements and schedules,
including the notes thereto, included in the Registration Statement and the
Prospectus are accurate and comply in all material respects with the Act and the
Regulations thereunder and present fairly the financial position of the
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Company and its subsidiaries as of the respective dates thereof and the related
statements of operations, cash flows and stockholders equity for the respective
periods specified and have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis. The selected and summary
financial information with respect to the Company included in the Registration
Statement and the Prospectus present fairly the information set forth therein in
compliance with the applicable regulations of the Commission and have been
compiled on a basis consistent with that of the audited financial statements in
the Registration Statement and the Prospectus.
(x) Neither the Company nor any subsidiary is in default with
respect to any contract or agreement to which it is a party; provided that this
representation shall not apply to defaults which in the aggregate are not
materially adverse to the condition, financial or other, or the business or
prospects of the Company and its subsidiaries taken as a whole.
(xi) Neither the Company nor any subsidiary is in violation of
any laws, ordinances or governmental rules or regulations to which it is
subject, and neither the Company nor any subsidiary has failed to obtain any
license, permit, franchise, easement, consent, or other governmental
authorization necessary to the ownership, leasing and operation of its
properties or to the conduct of its business, which violation or failure would
materially adversely affect the business, operations, affairs, properties,
prospects, profits or condition (financial or other) of the Company and its
subsidiaries taken as a whole. Neither the Company nor any subsidiary has, at
any time during the past five (5) years, (a) made any unlawful contributions to
any candidate for any political office, or failed fully to disclose any
contribution in violation of law, or (b) made any payment to any state, federal
or foreign government official, or other person charged with similar public or
quasi-public duty (other than payment required or permitted by applicable law).
(xii) Except as described in the Prospectus, the Company and
its subsidiaries own or possess, or can acquire on reasonable terms, adequate
patents, patent licenses, trademarks, service marks and trade names necessary to
conduct the business now operated by them, and neither the Company nor any
subsidiary has received any notice of infringement of or conflict with asserted
rights of others with respect to any patents, patent licenses, trademarks,
service marks or trade names which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would have a material adverse
effect on the conduct of the business, operations, financial condition or income
of the Company and its subsidiaries taken as a whole.
(xiii) Neither the Company nor any of its subsidiaries owns
any real estate. The Company and its subsidiaries have good and marketable title
to all other property owned by them, free and clear of all liens, encumbrances,
restrictions and defects except such as are described in the Registration
Statement or do not interfere with the use made and proposed to be made of such
property; and any property held under lease or sublease by the Company or its
subsidiaries is held under valid, subsisting and enforceable leases or subleases
with such exceptions as are not material and do not interfere with the use made
and proposed to be made of such property by the Company and its subsidiaries and
neither the Company nor any subsidiary has notice or knowledge of any material
claim of any sort which has been, or may be, asserted by anyone adverse to the
Company's or any subsidiary's rights as lessee or sublessee under any lease or
sublease described above, or affecting or questioning the Company's or any
subsidiary's rights to the continued possession of the leased or subleased
premises under any such lease or sublease in conflict with the terms thereof.
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(xiv) Except as described in the Prospectus, there is no
factual basis for any action, suit or other proceeding involving the Company or
any subsidiary or any of their material assets for any failure of the Company or
any of its subsidiaries, or any predecessor thereof, to comply with any
requirements of federal, state or local regulation relating to air, water, solid
waste management, hazardous or toxic substances, or the protection of health or
the environment. Except as described in the Prospectus, none of the property
leased by the Company or any of its subsidiaries is, to the best knowledge of
the Company, contaminated with any waste or hazardous substances, and neither
the Company nor any of its subsidiaries may be deemed an "owner or operator" of
a "facility" or "vessel" which owns, possesses, transports, generates or
disposes of a "hazardous substance" as those terms are defined in ss.9601 of the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42
U.S.C. ss.9601 ET SEQ.
(xv) No labor disturbance exists or is imminent with the
employees of the Company or its subsidiaries which would have a material adverse
effect on the Company and its subsidiaries taken as a whole.
(xvi) The Company has not taken and will not take, directly or
indirectly, any action designed to or which might reasonably be expected to
cause or result in stabilization or manipulation of the price of the Company's
Common Stock, and the Company is not aware of any such action taken or to be
taken by affiliates of the Company.
(xvii) The Company is not an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
(xviii) The Company's and each of its subsidiaries' systems of
internal accounting controls are sufficient to meet the broad objectives of
internal accounting control insofar as those objectives pertain to the
prevention or detection of errors or irregularities in amounts that would be
material in relation to the Company's consolidated financial statements; and,
except as disclosed in the Prospectus, neither the Company nor any subsidiary
nor any employee or agent of the Company or any subsidiary has made any payment
of funds of the Company or any subsidiary or received or retained any funds in
violation of any law, rule or regulation, the receipt or payment of which could
have a material adverse effect on the Company and its subsidiaries taken as a
whole.
(xix) There is no document or contract of a character required
to be described in the Registration Statement or the Prospectus or to be filed
as an exhibit to the Registration Statement that is not described or filed as
required. All such contracts to which the Company or any subsidiary is a party
has been duly authorized, executed and delivered by the Company or its
subsidiary constitute valid and binding agreements of the Company or its
subsidiary and are enforceable by the Company or its subsidiary in accordance
with the terms thereof.
(xx) Other than as contemplated by this Agreement, there is no
broker, finder or other party that is entitled to receive from the Company or
any subsidiary any brokerage or finder's fee or other fee or commission as a
result of any of the transactions contemplated by this Agreement.
(b) Each Selling Shareholder severally represents and warrants to
and agrees with each Underwriter and the Company that:
(i) All authorizations and consents necessary for the
execution and delivery by it of this Agreement and the sale and delivery of the
Shares to be sold by such Selling Shareholder
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hereunder have been given and are in full force and effect on the date hereof
and will be in full force and effect on the Closing Date (and, if applicable,
the Option Closing Date).
(ii) Such Selling Shareholder has, and on the Closing Date
(and, if applicable, the Option Closing Date) will have good and valid title to
the Shares to be sold by such Selling Shareholder, free and clear of all liens,
mortgages, pledges, encumbrances, claims, equities and security interests
whatsoever, and will have, full right, power and authority to enter into this
Agreement and to sell, assign, transfer and deliver the Shares to be sold by
such Selling Shareholder hereunder.
(iii) Upon delivery of and payment for such Shares hereunder,
the several Underwriters (assuming they are bona fide purchasers under the
Uniform Commercial Code) will acquire valid and unencumbered title to such
Shares to be sold by such Selling Shareholder hereunder, free and clear of all
liens, mortgages, pledges, encumbrances, claims, equities and security interests
whatsoever.
(iv) The consummation by such Selling Shareholder of the
transactions contemplated herein and the fulfillment by such Selling Shareholder
of the terms hereof will not result in a violation or breach of any terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, note, loan agreement, sale and leaseback arrangement or other agreement
or instrument to which such Selling Shareholder is a party, or of any order,
rule or regulation applicable to such Selling Shareholder of any court or of any
regulatory body of an administrative agency or other governmental body having
jurisdiction.
(v) Such Selling Shareholder has not taken and will not take,
directly or indirectly, any action designed to or which might be reasonably
expected to cause or result in stabilization or manipulation of the price of the
Company's Common Stock, and such Selling Shareholder is not aware of any such
action taken or to be taken by affiliates of such Selling Shareholder.
(vi) When the Registration Statement becomes effective and at
all times subsequent thereto, such information in the Registration Statement and
Prospectus and any amendments or supplements thereto as specifically refers to
such Selling Shareholder will not 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.
(vii) Certificates in negotiable form representing all of the
Shares to be sold by such Selling Shareholder hereunder have been placed in the
custody of ___________________ and ____________________ (the "Custodians") under
a Custody Agreement (the "Custody Agreement"), duly executed and delivered by
such Selling Shareholder, with the Custodians having the authority to deliver
the Shares to be sold by such Selling Shareholder hereunder, and that such
Selling Shareholder has duly executed and delivered a Power of Attorney (the
"Power of Attorney") appointing ______________________ and
_______________________ as such Selling Shareholder's attorneys-in-fact (the
"Attorneys-in-Fact") with the Attorneys-in-Fact having authority to execute and
deliver this Agreement on behalf of such Selling Shareholder, to determine the
purchase price to be paid by the Underwriters to the Selling Shareholders as
provided in Section 2, to authorize the delivery of the Shares to be sold by it
hereunder and otherwise to act on behalf of such Selling Shareholder in
connection with the transactions contemplated by this Agreement and such Custody
Agreement.
(viii) The Shares represented by the certificates held in
custody for such Selling Shareholder under the Custody Agreement are subject to
the interests of the Underwriters hereunder, and
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the arrangements made by such Selling Shareholder for such custody, and the
appointment by such Selling Shareholder of the Custodians under the Custody
Agreement and of the Attorneys-in-Fact by the Power of Attorney, are to that
extent irrevocable.
(ix) The obligations of such Selling Shareholder hereunder
shall not be terminated by operation of law, whether by the death or incapacity
of any individual Selling Shareholder or by the occurrence of any other event,
and if any Selling Shareholder should die or become incapacitated, or if any
other such event should occur before the delivery of the Shares hereunder,
certificates representing the Shares shall be delivered by or on behalf of each
Selling Shareholder in accordance with the terms and conditions of this
Agreement and of the Custody Agreement, and actions taken by the Custodians
pursuant to the Custody Agreement or by the Attorneys-in-Fact pursuant to the
Power of Attorney shall be as valid as if such death, incapacity or other event
had not occurred, regardless of whether or not the Custodians or
Attorneys-in-Fact, or any of them, shall have received notice of such death,
incapacity or other event.
(x) Such Selling Shareholder is not prompted to sell shares of
Common Stock by any information concerning the Company which is not included in
the Registration Statement.
(c) Any certificate signed by any officer of the Company and
delivered to you or to counsel for the Underwriters shall be deemed a
representation and warranty by the Company to each Underwriter as to the matters
covered thereby; and any certificate signed by or on behalf of the Selling
Shareholders as such and delivered to you or to counsel for the Underwriters
shall be deemed a representation and warranty by the Selling Shareholders to
each Underwriter as to the matters covered thereby.
5. ADDITIONAL COVENANTS. The Company and, where expressly indicated, the
Selling Shareholders, covenant and agree with the several Underwriters that:
(a) If the Registration Statement is not effective under the Act,
the Company will use its best efforts to cause the Registration Statement to
become effective as promptly as possible, and it will notify you, promptly after
it shall receive notice thereof, of the time when the Registration Statement has
become effective. The Company (i) will prepare and timely file with the
Commission under Rule 424(b) of the Rules and Regulations, if required, a
Prospectus containing information previously omitted at the time of
effectiveness of the Registration Statement in reliance on Rule 430A of the
Rules and Regulations or otherwise or a Term Sheet or Abbreviated Term Sheet, as
applicable; (ii) will not file any amendment to the Registration Statement or
supplement to the Prospectus of which the Underwriters shall not previously have
been advised and furnished with a copy or to which the Underwriters shall have
reasonably objected in writing or which is not in compliance with the Rules and
Regulations; and (iii) will promptly notify you after it shall have received
notice thereof of the time when any amendment to the Registration Statement
becomes effective or when any supplement to the Prospectus has been filed.
(b) The Company will advise the Underwriters promptly, after it
shall receive notice or obtain knowledge thereof, of any request of the
Commission for amendment of the Registration Statement or for supplement to the
Prospectus or for any additional information, or of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the use of the Prospectus or of the institution or threatening of
any proceedings for that purpose, and the Company will use its best efforts to
prevent the issuance of any such stop order preventing or suspending the use of
the Prospectus and to obtain as soon as possible the lifting thereof, if issued.
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(c) The Company will cooperate with the Underwriters and their
counsel in endeavoring to qualify the Shares for sale under the securities laws
of such jurisdictions as they may have designated and will make such
applications, file such documents, and furnish such information as may be
necessary for that purpose, provided the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction where it is not now so qualified or required to file
such a consent or to subject itself to taxation as doing business in any
jurisdiction where it is not now so taxed. The Company will, from time to time,
file such statements, reports, and other documents, as are or may be required to
continue such qualifications in effect for so long a period as the Underwriters
may reasonably request.
(d) The Company will deliver to, or upon the order of, the
Underwriters, without charge from time to time, as many copies of any
Preliminary Prospectus as they may reasonably request. The Company will deliver
to, or upon the order of, the Underwriters without charge as many copies of the
Prospectus, or as it thereafter may be amended or supplemented, as they may from
time to time reasonably request. The Company consents to the use of such
Prospectus by the Underwriters and by all dealers to whom the Shares may be
sold, both in connection with the offering or sale of the Shares and for such
other purposes and for such period of time thereafter as the Prospectus is
required by law to be delivered in connection with the offering or sale of the
Shares. The Company will deliver to the Underwriters at or before the Closing
Date two (2) signed copies of the Registration Statement and all amendments
thereto including all exhibits filed therewith, and will deliver to the
Underwriters such number of copies of the Registration Statement, without
exhibits, and of all amendments thereto, as they may reasonably request.
(e) If, during the period in which a prospectus is required by law
to be delivered by an Underwriter or dealer, any event shall occur as a result
of which, in the judgment of the Company or in your judgment or in the opinion
of counsel for the Underwriters, it becomes necessary to amend or supplement the
prospectus in order to make the statements therein, in light of the
circumstances existing at the time the prospectus is delivered to a purchaser,
not misleading, or, if it is necessary at any time to amend or supplement the
prospectus to comply with any law, the Company promptly will prepare and file
with the Commission an appropriate amendment to the Registration Statement or
supplement to the prospectus so that the prospectus as so amended or
supplemented will not, in the light of the circumstances when it is so
delivered, be misleading, or so that the prospectus will comply with law.
(f) The Company will make generally available to its stockholders
and will file as an exhibit in a report pursuant to the Securities and Exchange
Act of 1934, as amended (the "1934 Act"), as soon as it is practicable to do so,
but in any event not later than fifteen (15) months after the effective date of
the Registration Statement, an earnings statement in reasonable detail, covering
a period of at least twelve (12) consecutive months beginning after the
effective date of the Registration Statement, which earnings statement shall
satisfy the requirements of Section 11(a) of the Act and Rule 158 of the Rules
and Regulations and will advise the Underwriters in writing when such statement
has been so made available.
(g) The Company will, for a period of five (5) years from the
Closing Date, deliver to the Underwriters at their principal executive offices a
reasonable number of copies of annual reports, quarterly reports, current
reports and copies of all other documents, reports and information furnished by
the Company to its stockholders or filed with any securities exchange pursuant
to the requirements of such exchange or with the Commission pursuant to the Act
or the 1934 Act. The Company will deliver to the Underwriters similar reports
with respect to any significant subsidiaries, as that term is defined in the
Rules and Regulations, which are not consolidated in the Company's financial
statements. Any report, document
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or other information required to be furnished under this paragraph (g) shall be
furnished as soon as practicable after such report, document or information
becomes available.
(h) The Company will apply the proceeds from the sale of the Shares
as set forth in the description under "Use of Proceeds" in the Prospectus, which
description complies in all respects with the requirements of Item 504 of
Regulation S-K.
(i) The Company will supply you with copies of all correspondence to
and from, and all documents issued to and by, the Commission in connection with
the registration of the Shares under the Act.
(j) Prior to the Closing Date (and, if applicable, the Option
Closing Date), the Company will furnish to you, as soon as they have been
prepared, copies of any unaudited interim consolidated financial statements of
the Company for any periods subsequent to the periods covered by the
consolidated financial statements appearing in the Registration Statement and
the Prospectus.
(k) Prior to the Closing Date (and, if applicable, the Option
Closing Date), neither the Company, any subsidiary nor any Selling Shareholder
will issue any press releases or other communications directly or indirectly and
will hold no press conferences with respect to the Company, any subsidiary, the
financial condition, results of operations, business, properties, assets or
liabilities of the Company or any subsidiary, or the offering of the Shares,
without your prior written consent.
(l) The Company will use its best efforts to obtain approval for,
and maintain the quotation of the Shares on, the Nasdaq National Market (the
"NNM").
(m) Except pursuant to this Agreement or with the prior written
consent of ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc., the Company will not, and the Company has
provided agreements executed by each shareholder of the Company providing that
none of them will, and the Company will use its best efforts to cause its other
directors and officers to not, for a period of 180 days from the Effective Date,
directly or indirectly sell, contract to sell or otherwise dispose of any shares
of the Company's Common Stock, any securities exchangeable for Common Stock or
any other rights to acquire such shares without your prior written consent,
except for the Shares sold hereunder and except for sales of shares of Common
Stock to the Company's employees pursuant to the exercise of options under the
Company's stock option plans.
(n) For a period of 180 days from the Effective Date, the Selling
Shareholders will not directly or indirectly sell, contract to sell or otherwise
dispose of any shares of the Company's Common Stock or rights to acquire such
shares without your prior written consent, except for the Shares sold hereunder.
(o) The Company and its subsidiaries will maintain and keep accurate
books and records reflecting their assets and maintain internal accounting
controls which provide reasonable assurance that (i) transactions are executed
in accordance with management's authorization, (ii) transactions are recorded as
necessary to permit the preparation of the Company's consolidated financial
statements and to maintain accountability for the assets of the Company and its
subsidiaries, (iii) access to the assets of the Company and its subsidiaries is
permitted only in accordance with management's authorization, and (iv) the
recorded accounts of the assets of the Company and its subsidiaries are compared
with existing assets at reasonable intervals.
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6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several obligations of the
Underwriters to purchase and pay for the Shares, as provided herein, shall be
subject to the accuracy in all material respects, as of the date hereof and as
of the Closing Date (and, if applicable, the Option Closing Date), of the
representations and warranties of the Company and the Selling Shareholders
contained herein, to the performance in all material respects by the Company and
the Selling Shareholders of their covenants and obligations hereunder, and to
the following additional conditions:
(a) All filings required by Rule 424 and Rule 430A of the Rules and
Regulations shall have been made. No stop order suspending the effectiveness of
the Registration Statement, as amended from time to time, shall have been issued
and no proceeding for that purpose shall have been initiated or, to the
knowledge of the Company or any Underwriter, threatened or contemplated by the
Commission, and any request of the Commission for additional information (to be
included in the Registration Statement or the Prospectus or otherwise) shall
have been complied with to the reasonable satisfaction of the Underwriters.
(b) No Underwriter shall have disclosed in writing to the Company on
or prior to the Closing Date (and, if applicable, the Option Closing Date), that
the Registration Statement or Prospectus or any amendment or supplement thereto
contains an untrue statement of fact which, in the opinion of counsel to the
Underwriters, is material, or omits to state a fact which, in the opinion of
such counsel, is material and is required to be stated therein or is necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading.
(c) On the Closing Date (and, if applicable, the Option Closing
Date), you shall have received the opinion of counsel for the Company, addressed
to you and dated the Closing Date (and, if applicable, the Option Closing Date),
to the effect that:
(i) The Company and its subsidiaries have been duly
incorporated and are validly existing as corporations in good standing under the
laws of the states or other jurisdictions in which they are incorporated with
the corporate power and authority to own, lease and operate their properties and
conduct their business as described in the Registration Statement; the Company
and its subsidiaries are duly qualified to do business as foreign corporations
in good standing in each state or other jurisdiction in which their ownership or
leasing of property or conduct of business legally requires such qualification,
except where the failure to be so qualified would not have a material adverse
effect on the ability of the Company and its subsidiaries to conduct their
business as described in the Registration Statement; and the outstanding shares
of capital stock of the Company's subsidiaries have been duly authorized and
validly issued, are fully paid and nonassessable and, to the knowledge of such
counsel after due inquiry, are owned by the Company free and clear of any
mortgage, pledge, lien, encumbrance, charge or adverse claim and are not the
subject of any agreement or understanding with any person; no options, warrants
or other rights to purchase, agreement or other obligations to issue or other
rights to convert any obligations into shares of capital stock or ownership
interests in the subsidiaries are outstanding.
(ii) The Company has duly and validly authorized capital stock
as set forth under the heading "Capitalization" in the Prospectus; all
outstanding shares of Common Stock of the Company and the Shares conform to the
description thereof in the Prospectus under the heading "Description of Capital
Stock," and the outstanding shares of Common Stock have been duly authorized and
are validly issued, fully paid and non-assessable; the Shares to be sold by the
Company have been duly authorized and, when delivered and paid for in accordance
with this Agreement, will be validly issued, fully paid and non-assessable, and
the shareholders of the Company have no preemptive rights with respect to the
Shares.
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(iii) Such counsel has been advised by the staff of the
Commission that the Registration Statement has become effective under the Act
and, to the knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
for that purpose have been instituted or are pending or contemplated under the
Act.
(iv) The Registration Statement and the Prospectus, and each
amendment or supplement thereto, as of their respective effective or issue
dates, comply as to form and appear on their face to be appropriately responsive
in all material respects to the requirements of the Act and the applicable rules
and regulations (except that such counsel need express no opinion as to the
financial statements or other financial data).
(v) The descriptions in the Registration Statement and
Prospectus of contracts and other documents filed as exhibits to the
Registration Statement are accurate in all material respects; all other material
agreements between the Company and third parties expressly referenced in the
Prospectus are legal, valid and binding obligations of the Company.
(vi) No authorization, approval, consent, order, registration
or qualification of or with of any court or governmental body, authority or
agency is required with respect to the Company in connection with the
transactions contemplated by this Agreement, except such as may be required
under the Act or the Rules and Regulations or as may be required by the NASD or
under state securities laws in connection with the purchase and distribution of
the Shares by the Underwriters.
(vii) The filing of the Registration Statement has been duly
authorized by the Board of Directors of the Company. This Agreement has been
duly authorized, executed and delivered by the Company. The performance of this
Agreement and the consummation of the transactions herein contemplated will not
result in a violation of the Company's Certificate of Incorporation or Bylaws or
result in a breach or violation of any of the terms and provisions of, or
constitute a default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any properties or assets of the Company or any of its
subsidiaries under, any statute, or under any indenture, mortgage, deed of
trust, note, loan agreement, sale and leaseback arrangement, or any other
agreement or instrument known to such counsel to which the Company or any of its
subsidiaries is a party or by which they are bound or to which any of the
properties or assets of the Company or any of its subsidiaries are subject, or
any order, rule or regulation known to such counsel of any court or governmental
agency or body having jurisdiction over the Company or its subsidiaries or their
properties, except, in the case of any such violation, breach, default, creation
or imposition, to such extent as does not materially adversely affect the
business of the Company and its subsidiaries taken as a whole.
(viii) To the knowledge of such counsel, (a) there are no
material (individually, or in the aggregate) legal, governmental or regulatory
proceedings pending or threatened to which the Company or any of its
subsidiaries is a party or of which the business or properties of the Company or
any of its subsidiaries is the subject which are not disclosed in the
Registration Statement and Prospectus; (b) there are no contracts or documents
of a character required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement which are
not described or filed as required; and (c) there are no statutes or regulations
required to be described in the Registration Statement or Prospectus which are
not described as required.
-13-
(ix) To the knowledge of such counsel, the Company and each of
its subsidiaries holds all licenses, certificates, permits and approvals from
all state, federal and other regulatory authorities, and has satisfied in all
material respects the requirements imposed by regulatory bodies, administrative
agencies or other governmental bodies, agencies or officials, that are required
for the Company and its subsidiaries lawfully to own, lease and operate their
properties and conduct their business as described in the Prospectus, and, to
the knowledge of such counsel, each of the Company and its subsidiaries is
conducting its business in compliance in all material respects with all of the
laws, rules and regulations of each jurisdiction in which it conducts its
business.
(x) The statements made in the Registration Statement under
the captions "Dividend Policy", "Capitalization", "Description of Capital
Stock", and "Shares Available for Future Sale," to the extent that they
constitute summaries of documents referred to therein or matters of law or legal
conclusions, have been reviewed by such counsel and are accurate summaries and
fairly present the information disclosed therein.
(xi) The Company is not, and will not become as a result of
the consummation of the transactions contemplated by this Agreement and
application of the net proceeds therefrom as described in the Prospectus,
required to register as an investment company under the Investment Company Act
of 1940.
(xii) Except as described in the Registration Statement, there
are no contracts, agreements or understanding known to such counsel between the
Company or any subsidiary and any person granting such person the right to
require the Company to file a registration statement under the 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 Statement or in any securities being registered
pursuant to any other registration statement filed by the Company under the Act.
(xiii) This Agreement has been duly authorized, executed and
delivered by the Company.
Such counsel also shall confirm that in the course of its duties in
connection with the preparation of the Registration Statement and Prospectus,
nothing came to such counsel's attention that would lead them to believe that
either the Registration Statement or Prospectus or any amendment or supplement
thereto (other than the financial statements or other financial data as to which
such counsel need express no opinion) contains any untrue statement of a
material fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
In rendering the foregoing opinion, such counsel may rely, provided
that the opinion shall state that you and they are entitled to so rely, (a) as
to matters involving laws of any jurisdiction other than Delaware, Texas or the
United States, upon opinions addressed to the Underwriters of other counsel
satisfactory to them and Peper, Martin, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ and Hetlage, and (b) as
to all matters of fact, upon certificates and written statements of the
executive officers of, and accountants for, the Company.
(d) On the Closing Date (and, if applicable, the Option Closing
Date), you shall have received the opinion of counsel to the Selling
Shareholders, addressed to you and dated the Closing Date (and, if applicable,
the Option Closing Date), to the effect that:
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(i) Each Selling Shareholder has duly authorized, executed and
delivered the Custody Agreement and Power of Attorney, appointing
__________________ and __________________ as such Selling Shareholder's
Custodians with authority to take custody of and deliver the Shares as
represented by certificates on behalf of such Selling Shareholder in connection
with the transactions contemplated by this Agreement and the Custody Agreement
and appointing __________________ and _____________ as such Selling
Shareholder's attorneys-in-fact with authority to execute and deliver this
Agreement on behalf of such Selling Shareholder and otherwise to act on behalf
of such Selling Shareholder in connection with the transactions contemplated by
this Agreement and the Power of Attorney.
(ii) This Agreement has been duly authorized, executed and
delivered on behalf of the Selling Shareholders.
(iii) Each Selling Shareholder has full legal right, power and
authority to sell, assign, transfer and deliver the Shares to be sold by such
Selling Shareholder.
(iv) Each Selling Shareholder has good and valid title to the
Shares being sold by such Selling Shareholder hereunder, free and clear of all
liens, mortgages, pledges, encumbrances, claims, equities and security
interests, and (assuming the underwriters are bona fide purchasers within the
meaning of the Uniform Commercial Code) has transferred to the Underwriters good
and valid title to the Shares being sold by such Selling Shareholder on the
Closing Date, free and clear of all liens, mortgages, pledges, encumbrances,
claims, equities and security interests whatsoever.
(v) No consent, approval, authorization or order of any court,
or governmental agency or body is required for consummation of the transactions
contemplated by this Agreement in connection with the Shares to be sold by each
Selling Shareholder hereunder except such as may be required under the Act or
the Rules or Regulations or as may be required by the NASD.
In rendering the foregoing opinion, such counsel may rely, provided
that the opinion shall state that you and they are entitled to so rely, (a) as
to matters involving laws of any jurisdiction other than _______________ or the
United States, upon opinions addressed to the Underwriters of other counsel
satisfactory to them and Peper, Martin, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇, and (b) as
to all matters of fact, upon certificates and written statements of the Selling
Shareholders.
(e) You shall have received on the Closing Date (and, if applicable,
the Option Closing Date), from Peper, Martin, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ and Hetlage,
counsel to the Underwriters, such opinion or opinions, dated the Closing Date
(and, if applicable, the Option Closing Date) with respect to the incorporation
of the Company, the validity of the Shares, the Registration Statement, the
Prospectus and other related matters as you may reasonably require; the Company
and Selling Shareholders shall have furnished to such counsel such documents as
they reasonably request for the purpose of enabling them to pass on such
matters.
(f) On the date of this Agreement and on the Closing Date (and, if
applicable, the Option Closing Date), you shall have received from ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ LLP, a letter or letters, dated the date of this Agreement and the
Closing Date (and, if applicable, the Option Closing Date), respectively, in
form and substance satisfactory to you, confirming that they are independent
public accountants with respect to the Company within the meaning of the Act and
the published Rules and Regulations, and the answer to
-15-
Item 509 of Regulation S-K set forth in the Registration Statement is correct
insofar as it relates to them, and addressing the matters set forth in Schedule
III hereto.
(g) Except as contemplated in the Prospectus, (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; and (ii) subsequent to the respective
dates as of which information is given in the Registration Statement and the
Prospectus, neither the Company nor any of its subsidiaries shall have incurred
any liability or obligation, direct or contingent, or entered into transactions,
and there shall not have been any change in the capital stock or long-term debt
of the Company or its subsidiaries or any change in the condition (financial or
other), net worth, business, affairs, management, prospects or results of
operations of the Company or its subsidiaries, the effect of which, in any such
case described in clause (i) or (ii), is in your judgment so material or adverse
as to make it impracticable or inadvisable to proceed with the public offering
or the delivery of the Shares being delivered on such Closing Date (and, if
applicable, the Option Closing Date) on the terms and in the manner contemplated
in the Prospectus.
(h) There shall not have occurred any of the following: (i) a
suspension or material limitation in trading in securities generally on the New
York Stock Exchange or the American Stock Exchange or the establishing on such
exchanges by the Commission or by such exchanges of minimum or maximum prices
which are not in force and effect on the date hereof; (ii) a general moratorium
on commercial banking activities declared by either federal or state
authorities; (iii) the outbreak or escalation of hostilities involving or
affecting the United States or the declaration by the United States of a
national emergency or war, if the effect of any such event specified in this
clause (iii) in your judgment makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the Shares in the manner
contemplated in the Prospectus; (iv) any calamity or crisis, change in national,
international or world affairs, act of God, change in the international or
domestic markets, or change in the existing financial, political or economic
conditions in the United States or elsewhere, if the effect of any such event
specified in this clause (iv) makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the Shares in the manner
contemplated in the Prospectus; or (v) the enactment, publication, decree, or
other promulgation of any federal or state statute, regulation, rule, or order
of any court or other governmental authority, or the taking of any action by any
federal, state or local government or agency in respect of fiscal or monetary
affairs, if the effect of any such event specified in this clause (v) in your
judgment makes it impracticable or inadvisable to proceed with the public
offering or the delivery of the Shares in the manner contemplated in the
Prospectus.
(i) You shall have received certificates, dated the Closing Date
(and, if applicable, the Option Closing Date) and signed by the President and
the Chief Financial Officer of the Company stating that (i) they have carefully
examined the Registration Statement and the Prospectus as amended or
supplemented and nothing has come to their attention that would lead them to
believe that either the Registration Statement or the Prospectus, or any
amendment or supplement thereto as of their respective effective or issue dates,
contained, and the Prospectus as amended or supplemented at such Closing Date,
contains any untrue statement of a material fact, or omits to state a 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, and, that (ii) all representations and warranties made herein by the
Company are true and correct in all material respects at such Closing Date, with
the same effect as if made on and as of such Closing Date, and all agreements
herein to be performed by the Company on or prior to such Closing Date have been
duly performed in all material respects.
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(j) The Company and each of the Selling Shareholders shall not have
failed, refused, or been unable, at or prior to the Closing Date (and, if
applicable, the Option Closing Date) to have performed in all material respects
any agreement on their part to be performed or any of the conditions herein
contained and required to be performed or satisfied by them at or prior to such
Closing Date.
(k) The Company and the Selling Shareholders shall have furnished to
you at the Closing Date (and, if applicable, the Option Closing Date) such other
certificates as you may have reasonably requested as to the accuracy, on and as
of such Closing Date, of the representations and warranties of the Company and
the Selling Shareholders herein and as to the performance by the Company and the
Selling Shareholders of their obligations hereunder.
(l) The Shares shall have been approved for trading upon official
notice of issuance on the NNM.
(m) The NASD shall not have raised any objection with respect to the
fairness and reasonableness of the underwriting terms and arrangements.
(n) The agreements described in Section 5(m) shall be in full force
and effect.
All such opinions, certificates, letters and documents will be in
compliance with the provisions hereof only if they are reasonably satisfactory
to you and to Peper, Martin, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇, counsel for the
several Underwriters. The Company and Selling Shareholders will furnish you with
such conformed copies of such opinions, certificates, letters and documents as
you may request.
If any of the conditions specified above in this Section 6 shall not
have been satisfied at or prior to the Closing Date (and, if applicable, the
Option Closing Date) or waived by you in writing, this Agreement may be
terminated by you on notice to the Company and the Selling Shareholders.
7. INDEMNIFICATION.
(a) The Company will indemnify and hold harmless each Underwriter
and each person, if any, who controls any Underwriter within the meaning of the
Act, against any losses, claims, damages or liabilities, joint or several, to
which such Underwriter or such controlling person may become subject, under the
Act or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an untrue statement
or alleged untrue statement of a material fact contained in the Registration
Statement, any Preliminary Prospectus, the Prospectus, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading; and will reimburse each Underwriter and
each such controlling person for any legal or other expenses reasonably incurred
by such Underwriter or such controlling person in connection with investigating
or defending any such loss, claim, damage, liability or action; provided,
however, that the Company shall not be liable in any such case to the extent
that any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made in the Registration Statement, such Preliminary Prospectus or the
Prospectus, or such amendment or supplement, in reliance upon and in conformity
with written information furnished to the Company by you or by any Underwriter
through you, specifically for use in the preparation thereof; and provided,
further, that if any Preliminary Prospectus or the Prospectus contained
-17-
any alleged untrue statement or allegedly omitted to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading and such statement or omission shall have been corrected in a
revised Preliminary Prospectus or in the Prospectus or in an amended or
supplemented Prospectus, the Company shall not be liable to any Underwriter or
controlling person under this subsection (a) with respect to such alleged untrue
statement or alleged omission to the extent that any such loss, claim, damage or
liability of such Underwriter or controlling person results from the fact that
such Underwriter sold Shares to a person to whom there was not sent or given, at
or prior to the written confirmation of such sale, such revised Preliminary
Prospectus or Prospectus or amended or supplemented Prospectus. This indemnity
agreement shall be in addition to any liabilities which the Company may
otherwise have.
(b) Each Selling Shareholder will indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of the Act, against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter or controlling person may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the Registration Statement, any Preliminary Prospectus, the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or the alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in the Registration
Statement, such Preliminary Prospectus or the Prospectus, or such amendment or
supplement, in reliance upon and in conformity with written information
furnished to the Company or any Underwriter by such Selling Shareholder
specifically for use in the preparation thereof; and will reimburse any legal or
other expenses reasonably incurred by each Underwriter and each person, if any,
who controls any Underwriter within the meaning of the Act, in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the indemnity contained in this subsection (b) with
respect to any Preliminary Prospectus shall not inure to the benefit of any
Underwriter (or to the benefit of any person controlling such Underwriter) in
respect of any action or claim asserted by a person who purchased any Shares
from such Underwriter, if, within the time required by the Act such person was
not sent or given a copy of the Prospectus, as then amended or supplemented. In
no event, however, shall the liability of any Selling Shareholder for
indemnification under this Section 7(b) exceed the proceeds received by such
Selling Shareholder from the Underwriters in the offering. This indemnity
agreement shall be in addition to any liabilities which the Selling Shareholders
may otherwise have.
(c) Each Underwriter will indemnify and hold harmless the Company,
each of its directors, each of its officers who have signed the Registration
Statement and, each person, if any, who controls the Company within the meaning
of the Act, and each Selling Shareholder, against any losses, claims, damages or
liabilities, joint or several, to which the Company or any such director,
officer or controlling person or any such Selling Shareholder may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the Registration Statement, any Preliminary Prospectus, the Prospectus, any
amendment or supplement thereto, or arise out of or are based upon the omission
or the alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in the Registration
Statement, such Preliminary Prospectus or the Prospectus, such amendment or
supplement, in reliance upon and in conformity with written information
furnished to the Company by any such Underwriter specifically for use
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in the preparation thereof; and will reimburse any legal or other expenses
reasonably incurred by the Company or any such director, officer or controlling
person or any such Selling Shareholder in connection with investigating or
defending any such loss, claim, damage, liability or action. The Company and
each Selling Shareholder acknowledge that the statements set forth under the
heading "Underwriting" in any Preliminary Prospectus and the Prospectus
constitute the only information relating to the Underwriters furnished in
writing to the Company by the Underwriters expressly for inclusion in the
Registration Statement, any Preliminary Prospectus or the Prospectus.
(d) Any party which proposes to assert the right to be indemnified
under this Section 7 shall, within ten (10) days after receipt of notice of
commencement of any action, suit or proceeding against such party in respect of
which a claim is to be made against an indemnifying party under this Section 7,
notify each such indemnifying party of the commencement of such action, suit or
proceeding, enclosing a copy of all papers served, but the omission so to notify
such indemnifying party of any such action, suit or proceeding shall not relieve
such indemnifying party from any liability which it may have to any indemnified
party otherwise than under this Section 7. In case any such action, suit or
proceeding shall be brought against any indemnified party and it shall notify
the indemnifying party of the commencement thereof, the indemnifying party shall
be entitled to participate in, and, to the extent that it shall wish, jointly
with any other indemnifying party, similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party for any legal or other expenses, other than
reasonable costs of investigation, subsequently incurred by such indemnified
party in connection with the defense thereof. The indemnified party shall have
the right to employ its own counsel in any such action, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless (i) the employment of counsel by such indemnified party at the expense of
the indemnifying party has been authorized by the indemnifying party, (ii) the
indemnified party shall have been advised by such counsel in a written opinion
that there may be a conflict of interest between the indemnifying party and the
indemnified party in the conduct of the defense, or certain aspects of the
defense, of such action (in which case the indemnifying party shall not have the
right to direct the defense of such action with respect to those matters or
aspects of the defense on which a conflict exists or may exist on behalf of the
indemnified party) or (iii) the indemnifying party shall not in fact have
employed counsel to assume the defense of such action, in any of which events
such fees and expenses to the extent applicable shall be borne by the
indemnifying party. An indemnifying party shall not be liable for any settlement
of any action or claim effected without its consent. Each indemnified party, as
a condition of such indemnity, shall cooperate in good faith with the
indemnifying party in the defense of any such action or claim.
(e) If the indemnification provided for in this Section 7 is for any
reason, other than pursuant to the terms thereof, judicially determined (by the
entry of a final judgment or decree by a court of competent jurisdiction and the
expiration of time to appeal or the denial of the last right to appeal) to be
unavailable to an indemnified party under subsections (a), (b) or (c) above in
respect of any losses, claims, damages or liabilities (or actions 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 losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative benefits received by the Company, the Selling
Shareholders and the Underwriters from the offering of the Shares. If, however,
the allocation provided by the immediately preceding sentence is not permitted
by applicable law, then each indemnifying party shall contribute to such amount
paid or payable by such indemnified party in such proportion as is appropriate
to reflect not only such relative benefits but also the relative fault, as
applicable, of the Company, the Selling
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Shareholders and the Underwriters in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions in
respect thereof), as well as other relevant equitable considerations. The
relative benefits received by, as applicable, the Company, the Selling
Shareholders and the Underwriters shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses) received
by the Company and the Selling Shareholders bear to the total underwriting
discounts and commissions received by the Underwriters, 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, among other things, whether the untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company, the Selling Shareholders or the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Company,
the Selling Shareholders and the Underwriters agree that it would not be just
and equitable if contributions pursuant to this subsection (e) were determined
by pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this subsection (e). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above
in this subsection (e) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
subsection (e), no Underwriter shall be required to contribute any amount in
excess of the underwriting discounts and commissions applicable to the Shares
purchased by such Underwriter; no Selling Shareholder shall be required to
contribute any amount in excess of the proceeds received by such Selling
Shareholder from the Underwriters in the offering; and, no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this subsection
(e) to contribute are several in proportion to their respective underwriting
obligations and not joint.
8. REPRESENTATIONS AND AGREEMENTS TO SURVIVE DELIVERY. All
representations, warranties, and agreements of the Company and the Selling
Shareholders contained in Sections 7 and 11 herein or in certificates delivered
pursuant hereto, and the agreements of the Underwriters contained in Section 7
hereof, shall remain operative and in full force and effect regardless of any
termination or cancellation of this Agreement or any investigation made by or on
behalf of any Underwriter or any controlling person, the Company or any of its
officers, directors or any controlling persons, or the Selling Shareholders, and
shall survive delivery of the Shares to the Underwriters hereunder.
9. SUBSTITUTION OF UNDERWRITERS.
(a) If any Underwriter shall default in its obligation to purchase
the Shares which it has agreed to purchase hereunder, you may in your discretion
arrange for you or another party or other parties to purchase such Shares on the
terms contained herein. If within thirty-six (36) hours after such default by
any Underwriter you do not arrange for the purchase of such Shares, then the
Company and the Selling Shareholders shall be entitled to a further period of
thirty-six (36) hours within which to procure another party or parties
reasonably satisfactory to you to purchase such Shares on such terms. In the
event that, within the respective prescribed periods, you notify the Company and
the Selling Shareholders that you have so arranged for the purchase of such
Shares, or the Company and the Selling Shareholders notify you that they have so
arranged for the purchase of such Shares, you or the Company and the Selling
Shareholders shall have the right to postpone the Closing Date for a period of
not more than seven (7) days, in order to effect whatever changes may thereby be
made necessary in the Registration Statement or the Prospectus, or in any other
documents or arrangements, and the Company agrees to file promptly any
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amendments to the Registration Statement or the Prospectus which in your opinion
may thereby be made necessary. The term "Underwriter" as used in this Agreement
shall include any persons substituted under this Section 9 with like effect as
if such person had originally been a party to this Agreement with respect to
such Shares.
(b) If, after giving effect to any arrangements for the purchase of
the Shares of a defaulting Underwriter or Underwriters made by you or the
Company and the Selling Shareholders as provided in subsection (a) above, the
aggregate number of Shares which remains unpurchased does not exceed one tenth
(1/10) of the total Shares to be sold on the Closing Date, then the Company and
the Selling Shareholders shall have the right to require each non-defaulting
Underwriter to purchase the Shares which such Underwriter agreed to purchase
hereunder and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Shares which such
Underwriter agreed to purchase hereunder) of the Shares of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of
the Shares of a defaulting Underwriter or Underwriters made by you or the
Company and the Selling Shareholders as provided in subsection (a) above, the
number of Shares which remains unpurchased exceeds one tenth (1/10) of the total
Shares to be sold on the Closing Date, or if the Company and the Selling
Shareholders shall not exercise the right described in subsection (b) above to
require the non-defaulting Underwriters to purchase Shares of the defaulting
Underwriter or Underwriters, then this Agreement shall thereupon terminate,
without liability on the part of any non-defaulting Underwriter or the Company
and the Selling Shareholders except for the expenses to be borne by the Company
and the Underwriters as provided in Section 11 hereof and the indemnity and
contribution agreements in Section 7 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
10. EFFECTIVE DATE AND TERMINATION.
(a) This Agreement shall become effective at 1:00 p.m., St. Louis
time, on the first business day following the effective date of the Registration
Statement, or at such earlier time after the effective date of the Registration
Statement as you in your discretion shall first release the Shares for offering
to the public; provided, however, that the provisions of Section 7 and 11 shall
at all times be effective. For the purposes of this Section 10(a), the Shares
shall be deemed to have been released to the public upon release by you of the
publication of a newspaper advertisement relating to the Shares or upon release
of telegrams, facsimile transmissions or letters offering the Shares for sale to
securities dealers, whichever shall first occur.
(b) This Agreement may be terminated by you at any time before it
becomes effective in accordance with Section 10(a) by notice to the Company and
the Selling Shareholders; provided, however, that the provisions of this Section
10 and of Section 7 and Section 11 hereof shall at all times be effective. In
the event of any termination of this Agreement pursuant to Section 9 or this
Section 10(b) hereof, the Company and the Selling Shareholders shall not then be
under any liability to any Underwriter except as provided in Section 7 or
Section 11 hereof.
(c) This Agreement may be terminated by you at any time at or prior
to the Closing Date by notice to the Company and the Selling Shareholders if any
condition specified in Section 6 hereof shall not have been satisfied on or
prior to the Closing Date. Any such termination shall be without liability of
any party to any other party except as provided in Sections 7 and 11 hereof.
-21-
(d) This Agreement also may be terminated by you, by notice to the
Company and the Selling Shareholders, as to any obligation of the Underwriters
to purchase the Option Shares, if any condition specified in Section 6 hereof
shall not have been satisfied at or prior to the Option Closing Date or as
provided in Section 9 of this Agreement.
If you terminate this Agreement as provided in Sections 10(b), 10(c)
or 10(d), you shall notify the Company and the Selling Shareholders by telephone
or telegram, confirmed by letter.
11. COSTS AND EXPENSES. The Company and the Selling Shareholders will bear
and pay the costs and expenses incident to the registration of the Shares and
public offering thereof, including, without limitation, (a) the fees and
expenses of the Company's accountants and the fees and expenses of counsel for
the Company, (b) the preparation, printing, filing, delivery and shipping of the
Registration Statement, each Preliminary Prospectus, the Prospectus and any
amendments or supplements thereto (except as otherwise expressly provided in
Section 5(d) hereof) and the printing, delivery and shipping of this Agreement,
the Agreement Among Underwriters, the Selected Dealer Agreement, Underwriters'
Questionnaires and Powers of Attorney, (c) the furnishing of copies of such
documents (except as otherwise expressly provided in Section 5(d) hereof) to the
Underwriters, (d) the fees payable to the NASD and the Commission in connection
with their review of the proposed offering of the Shares, (e) all printing and
engraving costs related to preparation of the certificates for the Shares,
including transfer agent and registrar fees, (f) all initial transfer taxes, if
any, (g) all fees and expenses relating to the authorization of the Shares for
trading on NNM, (h) all travel expenses, including air fare and accommodation
expenses, of representatives of the Company in connection with the offering of
the Shares and (i) all of the other costs and expenses incident to the
performance by the Company and Selling Shareholders of the registration and
offering of the Shares; provided, however, that the Underwriters will bear and
pay the fees and expenses of the Underwriters' counsel (other than fees and
disbursements relating to the qualification of the Shares for offering and sale
under the securities laws of the various states, if any, and qualifications
under NASD regulations), the Underwriters' out-of-pocket expenses, and any
advertising costs and expenses incurred by the Underwriters incident to the
public offering of the Shares; and provided, further, that the Selling
Shareholders will bear and pay the fees and expenses of the Selling
Shareholders' counsel.
If this Agreement is terminated by you in accordance with the
provisions of Section 10(c), the Company shall reimburse the Underwriters for
all of their out-of-pocket expenses, including the reasonable fees and
disbursements of counsel to the Underwriters.
12. DEFAULT OF SELLING SHAREHOLDERS. Failure or refusal by any of the
Selling Shareholders to sell and deliver on the Closing Date the Shares agreed
to be sold and delivered by such Selling Shareholder shall in no manner relieve
the other Selling Shareholders or the Company of their respective obligations
under this Agreement. If any Selling Shareholder should fail or refuse to sell
and deliver his Shares, the remaining Selling Shareholders shall have the right
hereby granted to increase, pro rata or otherwise, the number of Shares to be
sold by them hereunder to the total number of Shares to be sold by all Selling
Shareholders as set forth in Schedule I. If the remaining Selling Shareholders
do not fully exercise the right to increase the number of Shares to be sold by
them, the Underwriters, at your option, will have the right to elect to purchase
or not to purchase the Shares to be sold by the Company and the remaining
Selling Shareholders. In the event the Underwriters purchase the Shares of the
Company and such other Selling Shareholders pursuant to this Section 12, the
Closing Date shall be postponed for a period of not more than seven days in
order that the Registration Statement and Prospectus or other documents may be
amended or supplemented to the extent necessary under the provisions of the Act
and the Rules and Regulations or
-22-
under the securities laws of any jurisdiction. If the Underwriters determine not
to purchase the Shares of the Company and the other Selling Shareholders, if
any, this Agreement shall terminate and neither the Company nor the Underwriters
nor any other Selling Shareholder shall be under any obligation under this
Agreement except as provided in Section 7 hereof and except for the obligation
of the Company to pay for such expenses as are set forth in Section 11 hereof.
Nothing herein shall relieve a defaulting Selling Shareholder from liability for
his default or from liability under Section 7 hereof or for expenses imposed by
this Agreement upon such Selling Shareholder.
13. NOTICES. All notices or communications hereunder, except as herein
otherwise specifically provided, shall be in writing and if sent to the
Underwriters shall be mailed, delivered, sent by facsimile transmission, or
telegraphed and confirmed c/o ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Syndicate, facsimile number (314)
955-7387, or if sent to the Company shall be mailed, delivered, sent by
facsimile transmission, or telegraphed and confirmed to the Company at ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇, facsimile
number (713) _______ , or if sent to any Selling Shareholder shall be mailed,
delivered, sent by facsimile transmission or telegraphed and confirmed to such
Selling Shareholder, c/o the Attorney-in-Fact at ______________________________
______________________________. Notice to any Underwriter pursuant to Section 7
shall be mailed, delivered, sent by facsimile transmission, or telegraphed and
confirmed to such Underwriter's address as it appears in the Underwriters'
Questionnaire furnished in connection with the offering of the Shares or as
otherwise furnished to the Company and the Selling Shareholder.
14. PARTIES. This Agreement shall inure to the benefit of and be binding
upon the Underwriters and the Selling Shareholders, and the Company and their
respective successors and assigns. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person, corporation or
other entity, other than the parties hereto and their respective successors and
assigns and the controlling persons, officers and directors referred to in
Section 7, any legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision herein contained; this Agreement and all
conditions and provisions hereof being intended to be and being for the sole and
exclusive benefit of the parties hereto and their respective successors and
assigns and said controlling persons and said officers and directors, and for
the benefit of no other person, corporation or other entity. No purchaser of any
of the Shares from any Underwriter shall be construed a successor or assign by
reason merely of such purchase.
In all dealings with the Company and the Selling Shareholders under
this Agreement you shall act on behalf of each of the several Underwriters. The
Company and the Selling Shareholders shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of the Underwriters, made or
given by you on behalf of the Underwriters, as if the same shall have been made
or given in writing by the Underwriters.
15. COUNTERPARTS. This Agreement may be executed by any one or more of the
parties hereto in any number of counterparts, each of which shall be deemed to
be an original, but all such counterparts shall together constitute one and the
same instrument.
16. PRONOUNS. Whenever a pronoun of any gender or number is used herein,
it shall, where appropriate, be deemed to include any other gender and number.
17. APPLICABLE LAW. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Missouri.
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If the foregoing is in accordance with your understanding, please so
indicate in the space provided below for that purpose, whereupon this letter
shall constitute a binding agreement among the Company, each of the Selling
Shareholders and the Underwriters.
▇▇▇▇▇▇ INTERNATIONAL, INC.
By: __________________________________
Title: President
Selling Shareholders Named in
Schedule I Hereto
By: __________________________________
Attorney-in-Fact
Accepted in St. Louis,
Missouri as of the date first
above written, on behalf of
ourselves and each of the
several Underwriters named in
Schedule II hereto.
▇.▇. ▇▇▇▇▇▇▇ & SONS, INC.
▇▇▇▇▇▇ GULL ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ INC.
By: ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
By: _____________________________________
Title: Senior Vice President
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SCHEDULE I
NUMBER OF
SELLING SHAREHOLDERS FIRM SHARES
Total
-25-
SCHEDULE II
NAME NUMBER OF SHARES
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
▇▇▇▇▇▇ Gull ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Inc.
_______________________ _____
_______________________ _____
_______________________ _____
_______________________ _____
_______________________ _____
_______________________ _____
_______________________ _____
_______________________ _____
_______________________ _____
_______________________ _____
_______________________ _____
_______________________ _____
Total _____
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SCHEDULE III
Pursuant to Section 6(f) of the Underwriting Agreement, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
LLP shall furnish letters to the Underwriters to the effect that:
1. In their opinion, the financial statements and any supplementary
financial information and schedules audited (including pro forma financial
information examined) by them and included in the Prospectus or the Registration
Statement comply as to form in all material respects with the applicable
accounting requirements of the Act and the applicable Rules and Regulations
thereunder; and, if applicable, they have made a review in accordance with
standards established by the American Institute of Certified Public Accountants
of the unaudited interim financial statements, selected financial data, pro
forma financial information, or condensed financial statements derived from
audited financial statements of the Company and its subsidiaries for the periods
specified in such letter, as indicated in their reports thereon, copies of which
have been furnished to the Representatives of the Underwriters (the
"Representatives").
2. On the basis of limited procedures, not constituting an audit in
accordance with generally accepted auditing standards, consisting of a reading
of the unaudited financial statements and other information referred to below,
performing the procedures specified by the AICPA for a review of interim
financial information as discussed in SAS No. 71, Interim Financial Information,
on the latest available interim financial statements of the Company and its
subsidiaries, inspection of the minute books of the Company and its subsidiaries
since the date of the latest audited financial statements included in the
Prospectus, inquiries of officials of the Company and its subsidiaries
responsible for financial and accounting matters and such other inquiries and
procedures as may be specified in such letter, nothing came to their attention
that caused them to believe that:
(a) any material modifications should be made to the unaudited
balance sheet, statements of operations, statements of cash
flows, and statements of changes in shareholders' equity
included in the Prospectus for them to be in conformity
with generally accepted accounting principles, or such
unaudited statements, included in the Prospectus do not
comply as to form in all material respects with the
applicable accounting requirements of the Act and the
related published Rules and Regulations thereunder.
(b) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the
corresponding items in the unaudited consolidated financial
statements from which such data and items were derived, and
any such unaudited data and items were not determined on a
basis substantially consistent with the basis for the
corresponding amounts in the audited consolidated financial
statements included in the Prospectus.
(c) the unaudited financial statements which were not included
in the Prospectus but from which were derived any unaudited
condensed financial statements referred to in Clause (a)
and any unaudited income statement data and balance sheet
items included in the Prospectus and referred to in
Clause (b) were not determined on a basis substantially
consistent with the basis for the audited consolidated
financial statements included in the Prospectus.
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(d) any unaudited pro forma condensed financial statements
included in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements
of the Act and the published rules and regulations thereunder
or the pro forma adjustments have not been properly applied to
the historical amounts in the compilation of those statements.
(e) as of a specified date not more than five (5) days prior to
the date of such letter, there have been any changes in the
capital stock or any increase in the long-term debt of the
Company, or any decreases in working capital, net current
assets or net assets or other items specified by the
Representatives, or any changes in any items specified by
the Representatives, in each case as compared with amounts
shown in the latest balance sheet included in the
Prospectus, except in each case for changes, increases or
decreases which the Prospectus discloses have occurred or
may occur or which are described in such letter.
(f) for the period from the date of the latest financial
statements included in the Prospectus to the specified date
referred to in Clause (e) there were any decreases in net
sales or income from operations or the total or pro forma
per share amounts of net income or any other changes in any
other items specified by the Representatives, in each case
as compared with the comparable period of the preceding
year and with any other period of corresponding length
specified by the Representatives, except in each case for
changes, decreases or increases which the Prospectus
discloses have occurred or may occur or which are described
in such letter.
3. In addition to the audit referred to in their report(s) included in the
Prospectus and the limited procedures, inspection of minute books, inquiries and
other procedures referred to in paragraph (2) above, they have carried out
certain specified procedures, not constituting an audit in accordance with
generally accepted auditing standards, with respect to certain amounts,
percentages and financial information specified by the Representatives, which
are derived from the general accounting records of the Company and its
subsidiaries for the periods covered by their reports and any interim or other
periods since the latest period covered by their reports, which appear in the
Prospectus, or in Part II of, or in exhibits and schedules to, the Registration
Statement specified by the Representatives, and have compared certain of such
amounts, percentages and financial information with the accounting records of
the Company and its subsidiaries and have found them to be in agreement.
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