1
EXHIBIT 1.0
DAISYTEK INTERNATIONAL CORPORATION
3,000,000
SHARES OF
COMMON STOCK
($.01 PAR VALUE)
UNDERWRITING AGREEMENT
----------, 1998
2
UNDERWRITING AGREEMENT
----------, 1998
SBC Warburg Dillon Read Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
PaineWebber Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Company, L.L.C.
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
as Managing Underwriters
Dear Sirs:
Daisytek International Corporation, a Delaware corporation
(the "Company"), proposes to issue and sell and ▇▇▇▇▇ ▇. Heap (the "Selling
Stockholder") proposes to sell to the underwriters named in Schedule A (the
"Underwriters") an aggregate of 3,000,000 shares (the "Firm Shares") of Common
Stock, par value $.01 per share (the "Common Stock"), of the Company, of which
2,300,000 shares are to be issued and sold by the Company and 700,000 are to be
sold by the Selling Stockholder. In addition, solely for the purpose of
covering overallotments, the Company proposes to issue and sell and the Selling
Stockholder proposes to sell, at the Underwriters' option, an aggregate of up
to 450,000 additional shares of the Common Stock (the "Additional Shares"), of
which 345,000 are to be issued and sold by the Company and 105,000 are to be
sold by the Selling Stockholder. The Additional Shares and the Firm Shares are
hereinafter collectively sometimes referred to as the "Shares." The Shares are
described in the Prospectus which is referred to below.
The Company has filed, in accordance with the provisions of
the Securities Act of 1933, as amended, and the rules and regulations
thereunder (collectively called the "Act"), with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-3, including a
prospectus, relating to the Shares, which incorporates by reference documents
that the Company has filed in accordance with the provisions of the Securities
Exchange Act of 1934, as amended, and the rules and regulations thereunder
(collectively the "Exchange Act"). The Company has furnished to you, for use
by the Underwriters and by dealers, copies of one or more preliminary
prospectuses and all documents incorporated by reference therein (collectively,
the "Preliminary Prospectus") relating to the Shares. Except where the context
otherwise requires, the registration statement, as amended when it becomes
effective, including all
3
documents filed as a part thereof or incorporated by reference therein, and
including any registration statement filed pursuant to Rule 462(b) under the
Act increasing the size of the offering registered under the Act and in any
information contained in a prospectus subsequently filed with the Commission
pursuant to Rule 424(b) under the Act and deemed to be part of the registration
statement at the time of effectiveness, is herein called the "Registration
Statement," and the prospectus, in the form filed by the Company with the
Commission as part of the Registration Statement at the time of effectiveness
or, if Rule 424(b) is applicable, pursuant to Rule 424(b) under the Act, is
herein called the "Prospectus."
The Company, the Selling Stockholder and the Underwriters
agree as follows:
1. SALE AND PURCHASE. On the basis of the
representations and warranties and the other terms and conditions herein set
forth, each of the Company and the Selling Stockholder, severally and not
jointly, agrees to sell to the respective Underwriters and each of the
Underwriters, severally and not jointly, agrees to purchase from each of the
Company and the Selling Stockholder the respective number of Firm Shares
(subject to such adjustment as you may determine to avoid fractional shares)
which bears the same proportion to the number of Firm Shares to be sold by the
Company or by the Selling Stockholder, as the case may be, as the number of
Firm Shares set forth opposite the name of such Underwriter in Schedule A bears
to the total number of Firm Shares to be sold by the Company and the Selling
Stockholder, in each case at a purchase price of $_____ per Share. You shall
release the Firm Shares for public sale promptly after this Agreement becomes
effective. You may from time to time increase or decrease the public offering
price after the initial offering to the public to such extent as you may
determine.
In addition, on the basis of the representations and
warranties and the other terms and conditions herein set forth, the Company and
the Selling Stockholder hereby grant to the several Underwriters an option to
purchase, and the Underwriters shall have the right to purchase, severally and
not jointly, from the Company and the Selling Stockholder, ratably in
accordance with the number of Firm Shares to be purchased from each of them
(subject to such adjustment as you shall determine to avoid fractional shares),
all or a portion of the Additional Shares as may be necessary to cover
overallotments made in connection with the offering of the Firm Shares, at the
same purchase price per share to be paid by the several Underwriters to the
Company and the Selling Stockholder for the Firm Shares. This option may be
exercised at any time (but not more than once) on or before the thirtieth day
following the date hereof, by written notice from you to the Company and the
Selling Stockholder. Such notice shall set forth the aggregate number of
Additional Shares as to which the option is being exercised, and the date and
time when the Additional Shares are to be delivered (such date and time being
herein referred to as the "additional time of purchase"); provided, however,
that the additional time of purchase shall not be earlier than the "time of
purchase" (as defined below) nor earlier than the second business day* after
the date on which the option shall have been exercised nor later than the
eighth business day after the date on which the option shall have been
exercised. The number of Additional Shares to be sold to each Underwriter
shall be the number which bears the same proportion to the aggregate number of
Additional Shares being purchased as the number of Firm Shares set forth
opposite the name of such Underwriter on Schedule A bears to the total
----------------------------------
* As used herein, business day shall mean a day on which the New York
Stock Exchange is open for trading.
2
4
number of Firm Shares (subject, in each case, to such adjustment as you may
determine to eliminate fractional shares).
Pursuant to powers of attorney, which shall be satisfactory to
counsel for the Underwriters, granted by the Selling Stockholder, ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, Esq. will act as the representative of the Selling Stockholder.
The foregoing representative is authorized, on behalf of the Selling
Stockholder, to execute any documents necessary or desirable in connection with
the sale of the Shares to be sold hereunder by the Selling Stockholder, to make
delivery of the certificates of such Shares, to receive the proceeds of the
sale of such Shares, to give receipts for such proceeds, to distribute the
balance of such proceeds to the Selling Stockholder, to receive notices on
behalf of the Selling Stockholder and to take such other action as may be
necessary or desirable in connection with the transactions contemplated by this
Agreement.
2. PAYMENT AND DELIVERY. Payment of the purchase price
for the Firm Shares shall be made to the Company and the Attorney-in-Fact
referred to in Section 4(c) on behalf of the Selling Stockholder by certified
or official bank checks, in New York Clearing House funds (next day funds), at
the offices of SBC Warburg Dillon Read Inc. in New York City, against delivery
of the certificates for the Firm Shares to you for the respective accounts of
the Underwriters. Such payment and delivery shall be made at 10:00 A.M., New
York City time, on __________, 1998 (unless another time shall be agreed to by
you, the Company and the Selling Stockholder or unless postponed in accordance
with the provisions of Section 10). The time at which such payment and
delivery are actually made is hereinafter sometimes called the "time of
purchase." Certificates for the Firm Shares shall be delivered to you in
definitive form in such names and in such denominations as you shall specify on
the second business day preceding the time of purchase.
Payment of the purchase price for the Additional Shares shall
be made at the additional time of purchase in the same manner and at the same
office as the payment for the Firm Shares. Certificates for the Additional
Shares shall be delivered to you in definitive form in such names and in such
denominations as you shall specify on the second business day preceding the
additional time of purchase.
3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The
Company represents and warrants to each of the Underwriters that:
(a) each Preliminary Prospectus filed as part of
the Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the Act,
complied when so filed in all material respects with the Act, and when
the Registration Statement becomes or became effective and at all
times subsequent thereto up to the time of purchase and the time of
additional purchase, the Registration Statement and the Prospectus,
and any supplements or amendments thereto, complied and will comply in
all material respects with the provisions of the Act, and the
Registration Statement and the Prospectus at all such times did not
and will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading; provided, however, that the Company
makes no
3
5
representation or warranty with respect to any statement contained in
the Registration Statement or the Prospectus in reliance upon and in
conformity with information concerning the Underwriters and furnished
in writing by or on behalf of any Underwriter through you to the
Company expressly for use in the Registration Statement or the
Prospectus; provided, further, that such information furnished by or
on behalf of the Underwriters shall be limited to the section of the
Registration Statement and Prospectus entitled "Underwriting;" the
documents incorporated by reference in the Prospectus, at the time
they were filed with the Commission, complied in all material respects
with the requirements of the Exchange Act, and do not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; and no stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued and no
proceeding for that purpose has been instituted or threatened by the
Commission or by the state securities or Blue Sky authority of any
jurisdiction;
(b) all legal or governmental proceedings, or any
contract, agreement, instrument, lease, license, arrangement or
understanding required by the Act, or the applicable published rules
and regulations thereunder, to be described in the Registration
Statement or the Prospectus have been properly described therein; and
any contract, agreement, instrument, lease or license required by the
Act, or the applicable published rules and regulations thereunder, to
be filed as an exhibit to the Registration Statement has been so filed
or, if previously filed with the Commission, has been properly
incorporated by reference;
(c) the Company has authorized capitalization
consisting of 20,000,000 shares of Common Stock, of which __________
shares are issued and outstanding on the date hereof and no shares are
held in the Company's treasury, and 1,000,000 shares of Preferred
Stock, par value $1.00 per share, of which no shares are issued and
outstanding on the date hereof; all of the issued and outstanding
shares of capital stock (including Common Stock of the Company) have
been duly authorized and validly issued and are fully paid and
nonassessable; the Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Delaware with full corporate power and authority to own its
properties and conduct its business as described in the Registration
Statement and the Prospectus and to execute and deliver this Agreement
and to issue, sell and deliver the Shares to be issued and sold by it
as herein contemplated;
(d) all of the issued and outstanding shares of
capital stock of each of Daisytek, Incorporated, a Delaware
corporation, or its wholly-owned subsidiaries, Daisytek (Canada) Inc.,
Working Capital of America, Inc., Working Capital Canada, Inc., Home
Tech Depot, Inc., Daisytek De Mexico S.A. de C.V., Daisytek Latin
America, Inc., Supplies Express, Inc., Priority Fulfillment Services,
Inc., Priority Fulfillment Services of Canada, Inc., Daisytek De
Mexico Services, S.A. de C.V., Priority Fulfillment Services of
Australia, Priority Fulfillment Services de Mexico, S.A. de C.V.,
Daisytek Australia Pty. Ltd and Steadi- Systems, Ltd. [AND ITS
SUBSIDIARIES] (Daisytek, Incorporated,
4
6
Daisytek (Canada) Inc., Working Capital of America, Inc., Working
Capital Canada Inc., Home Tech Depot Inc., Daisytek De Mexico S.A. de
C.V., Daisytek Latin America, Inc., Supplies Express, Inc., Priority
Fulfillment Services, Inc., Priority Fulfillment Services of Canada,
Inc., Daisytek De Mexico Services, S.A. de C.V., Priority Fulfillment
Services of Australia, Priority Fulfillment Services de Mexico, S.A.
de C.V., Daisytek Australia Pty. Ltd and Steadi-Systems, Ltd. [AND ITS
SUBSIDIARIES] are collectively called the "Subsidiaries") are owned
directly or indirectly by the Company, except for directors'
qualifying shares; all of such shares have been duly authorized and
validly issued and are fully paid and nonassessable and, except as
described in the Prospectus, are owned free and clear of any pledge,
lien, encumbrance, security interest or other claim; there are no
outstanding rights, subscriptions, warrants, calls, preemptive rights,
options or other agreements of any kind with respect to the capital
stock of any of the Subsidiaries;
(e) each of the Subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of its respective jurisdiction of incorporation, with
full corporate power and authority to own its respective properties
and to conduct its respective business;
(f) the Company and each of the Subsidiaries have
good and marketable title in fee simple to all real properties and
good title to all other material properties and assets owned by them,
in each case free and clear of all liens, security interests, pledges,
charges, encumbrances, mortgages and defects (except such as are
described in the Prospectus or such as do not materially affect the
value of such property and do not interfere with the use made and
proposed to be made of such property by the Company or the
Subsidiaries); and the property held under lease by the Company and
each of the Subsidiaries is held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not
interfere with the use made and proposed to be made of such property
and buildings by the Company or the Subsidiaries;
(g) the Company and each of the Subsidiaries are
duly qualified as foreign corporations and are in good standing in
each other jurisdiction in which they own or lease property or conduct
their business and in each other jurisdiction in which the failure,
individually or in the aggregate, to be so qualified or licensed could
have a material adverse effect on the properties, assets, operations,
business or condition (financial or otherwise) of the Company and the
Subsidiaries taken as a whole; and the Company and the Subsidiaries
are in compliance in all material respects with the laws, orders,
rules, regulations and directives issued or administered by such
jurisdictions;
(h) neither the Company nor any of the
Subsidiaries is in breach of, or in default under (nor has any event
occurred which with notice, lapse of time or both would constitute a
breach of, or default under), its charter or bylaws, or in the
performance or observance of any obligation, agreement, covenant or
condition contained in any license, indenture, lease, mortgage, deed
of trust, bank loan, credit agreement, material supply or vendor
agreement or other agreement or instrument to which the Company or any
of the Subsidiaries is a party or by which any of them is bound, the
effect of which could have a material adverse effect on the
properties, assets, operations,
5
7
business or condition (financial or otherwise) of the Company and the
Subsidiaries, taken as a whole, and the execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated hereby will not conflict with, or result in any breach of
or constitute a default under (nor constitute any event which with
notice, lapse of time or both would constitute a breach of, or default
under), any provision of the charter or bylaws of the Company or any
of the Subsidiaries, any provision of any partnership agreement, any
provision of any license, indenture, lease, mortgage, deed of trust,
bank loan, credit agreement, material supply or vendor agreement or
other agreement or instrument to which the Company or any of the
Subsidiaries is a party of by which any of them or any of their
properties may be bound or affected, or under any federal, state,
local or foreign law, regulation or rule or any decree, judgment or
order applicable to the Company, which conflict, breach or default
would, individually or in the aggregate, have a material adverse
effect on the properties, assets, operations, business or condition
(financial or otherwise) of the Company and the Subsidiaries, taken as
a whole;
(i) (A) this Agreement has been duly authorized,
executed and delivered by the Company and is a legal, valid and
binding agreement of the Company enforceable in accordance with its
terms, except as rights to indemnity and contribution hereunder may be
limited by federal or state securities laws and except as the
enforceability hereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights
generally and general principles of equity; and (B) the Shares to be
issued and sold by the Company hereunder, when issued and delivered to
and paid for by the Underwriters as contemplated hereby, will be duly
authorized and validly issued and fully paid and nonassessable, free
and clear of any pledge, lien, encumbrance, security interest,
preemptive right or other claim.
(j) the capital stock of the Company, including
the Shares, conforms in all material respects to the description
thereof contained in the Registration Statement and Prospectus and the
certificates for the Shares are in due and proper form and the holders
of the Shares after making payment therefor will not be subject to
personal liability by reason of being such holders; and all offers and
sales of the Company's capital stock prior to the date hereof were at
all relevant times duly registered under the Act or exempt from the
registration requirements of the Act by reason of Sections 3(b), 4(2)
or 4(6) thereof, and were duly registered or the subject of an
available exemption from the registration requirements of the
applicable state securities or Blue Sky laws, or any actions under the
Act or any state securities or Blue Sky laws in respect of any such
offers or sales are effectively barred by the applicable statutes of
limitations or by effective waivers (except no representation is made
as to the registration or exemption requirements of the applicable
state securities or Blue Sky laws which were applicable to the
issuance of capital stock in the Company's initial public offering);
(k) all approvals, authorizations, consents or
orders of or filings with any national, state or local governmental or
regulatory commission, board, body, authority or agency required in
connection with the issuance and sale of the Shares as contemplated
hereby have been obtained, other than registration of the Shares under
the Act, clearance of the offering of the Shares with the National
Association of Securities
6
8
Dealers, Inc. (the "NASD") and any necessary qualification under the
securities laws of the various jurisdictions in which the Shares are
being offered by the Underwriters;
(l) except as disclosed in the Registration
Statement and the Prospectus, no person has the right, contractual or
otherwise, to cause the Company to issue to it, or register pursuant
to the Act, any shares of capital stock of the Company in consequence
of the sale of the Shares to the Underwriters hereunder, nor does any
person have preemptive rights, rights of first refusal or other rights
to purchase any of the Shares;
(m) except as described in the Registration
Statement and the Prospectus, no person holds a right to require or
participate in a registration under the Act of Common Stock or any
other equity securities of the Company;
(n) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, whose reports on the
consolidated financial statements of the Company and the Subsidiaries
are included or incorporated by reference in the Registration
Statement and the Prospectus, are independent public accountants as
required by the Act and the applicable published rules and regulations
thereunder;
(o) the Company and each of the Subsidiaries have
all necessary licenses, authorizations, consents and approvals and
have made all necessary filings required under any federal, state,
local or foreign law, regulation or rule, and have obtained all
necessary authorizations, consents, licenses and approvals from other
persons, in order to conduct their business except where the absence
of any such license, authorization, consent, approval or filing would
not have a material adverse effect on the properties, assets,
operations, business or condition (financial or otherwise) of the
Company and the Subsidiaries taken as a whole; neither the Company nor
any of the Subsidiaries is in violation of, or in default under, any
such license, authorization, consent or approval or any federal,
state, local or foreign law, regulation or rule or any decree, order
or judgment applicable to the Company or any of the Subsidiaries;
(p) there is no action, suit or proceeding
pending or threatened against the Company or any of the Subsidiaries
or any of their properties, at law or in equity, or before or by any
federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency which could result in a
judgment, decree or order having a material adverse effect on the
properties, assets, operations, business or condition (financial or
otherwise) of the Company and the Subsidiaries taken as a whole;
(q) the audited and unaudited financial
statements (including the related notes) and the financial schedules
included or incorporated by reference in the Registration Statement
and the Prospectus present fairly the consolidated financial condition
of the Company and the Subsidiaries as of the dates indicated and the
consolidated results of operations and cash flows of the Company and
the Subsidiaries for the periods specified, subject, in the case of
the Company's unaudited financial statements, to normal recurring year
end adjustments; such financial statements have been prepared in
conformity with generally accepted accounting principles applied on a
7
9
consistent basis during the periods involved; and no other financial
statements or schedules are required by the Act or the applicable
published rules and regulations thereunder to be included in the
Registration Statement or the Prospectus;
(r) subsequent to the respective dates as of
which information is given in the Registration Statement and the
Prospectus, and except as may be otherwise stated in the Registration
Statement or the Prospectus, there has not been (i) any material and
unfavorable change, financial or otherwise, in the business,
properties, prospects, results of operations or condition (financial
or otherwise), present or reasonably foreseeable, of the Company and
the Subsidiaries, taken as a whole, (ii) any transaction, which is
material to the Company and the Subsidiaries, taken as a whole,
contemplated or entered into by the Company or any of the Subsidiaries
or (iii) any obligation, contingent or otherwise, directly or
indirectly incurred by the Company which is material to the Company
and the Subsidiaries, taken as a whole;
(s) the Company has obtained the agreement of (i)
each of The ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ 1995 Interest in Possession Settlement
(No. 2), ▇▇▇▇▇ ▇. Heap, The ▇▇▇▇▇ ▇▇▇▇ Life Interest Settlement (No.
10), ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇., ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and
▇▇▇▇▇ ▇.▇. Vikanis to the effect set forth in Exhibit I hereto and
(iii) each of [▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. WHARF AND ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇] to
the effect set forth in Exhibit II hereto;
(t) neither the Company nor any of the
Subsidiaries, nor any employee of the Company or any of the
Subsidiaries, has made any payment of funds of the Company or any of
the Subsidiaries prohibited by law, and no funds of the Company or any
of the Subsidiaries have been set aside to be used for any payment
prohibited by law;
(u) the Company and the Subsidiaries have filed
all federal and state income and franchise tax returns required to be
filed and have paid all taxes shown thereon as due, and there is no
material tax deficiency which has been or might be asserted against
the Company or any of the Subsidiaries; all material tax liabilities
are adequately provided for on the books of the Company and the
Subsidiaries;
(v) the Company has not incurred any liability
for any finder's fees or similar payments in connection with the
transactions herein contemplated;
(w) the business, operations and facilities of
the Company and the Subsidiaries have been and are being conducted in
compliance in all material respects with all material applicable laws,
ordinances, rules, regulations, licenses, permits, approvals, plans,
authorizations or requirements relating to occupational safety and
health, or pollution, or protection of health or the environment, or
reclamation (including without limitation those relating to emissions,
discharges, releases or threatened releases of pollutants,
contaminants or hazardous or toxic substances, materials or wastes
into ambient air, surface water, groundwater or land, or relating to
the manufacture,
8
10
processing, distribution, use, treatment, storage, disposal, transport
or handling of chemical substances, pollutants, contaminants or
hazardous or toxic substances, materials or wastes, whether solid,
gaseous or liquid in nature) or otherwise relating to remediating real
property in which the Company or any of the Subsidiaries has any
interest, whether owned or leased, of any governmental department,
commission, board, bureau, agency or instrumentality of the United
States, any state or political subdivision thereof or any foreign
jurisdiction and all applicable judicial or administrative agency or
regulatory decrees, awards, judgments and orders relating thereto; and
neither the Company nor any of the Subsidiaries has received any
notice from a governmental instrumentality or any third party alleging
any violation thereof or liability thereunder (including without
limitation liability for costs of investigating or remediating sites
containing hazardous substances or damages to natural resources);
(x) neither the Company nor any of the
Subsidiaries is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or is subject to
regulation under such Act;
(y) except as maybe disclosed in writing to the
Managing Underwriters, no labor dispute with the employees of the
Company or any of the Subsidiaries exists or is imminent, and the
Company is not aware of any existing or imminent labor disturbance by
the employees of any of its principal suppliers, manufacturers or
contractors which might be expected to result in any material change
in the condition (financial or otherwise), or in the earnings, affairs
or business prospects of the Company and the Subsidiaries considered
as a whole;
(z) the Company owns or possesses, or can acquire
on reasonable terms, the patents, patent rights, licenses, inventions,
copyrights, know how (including trade secrets and other unpatented and
unpatentable proprietary or confidential information, systems or
procedures), trade marks, service marks and trade names presently
employed by it in connection with the business now operated by it, and
the Company has not received any notice of continuing infringement of
or continuing conflict with asserted rights of others with respect to
any of the foregoing which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would result in any
material adverse change in the condition (financial or otherwise), or
in the earnings, affairs or business prospects of the Company;
(aa) the Shares to be issued and sold by the
Company under this Agreement have been listed for trading on the
Nasdaq National Market upon official notice of issuance (subject to
the additional listing of the shares of Common Stock, if any, being
registered pursuant to Rule 462(b)) and the Company is in compliance
with the maintenance and designation criteria applicable to Nasdaq
National Market issuers;
(bb) otherwise than as set forth in or
contemplated in the Prospectus or the documents incorporated by
reference therein, there are no transactions with affiliates, as
defined in Rule 405 of the rules and regulations of the Commission,
which are required to be disclosed under the Act and the applicable
rules and regulations thereunder; and
9
11
(cc) the Company is not aware that any executive,
key employee or group of employees of the Company or any of the
Subsidiaries plans to terminate employment with the Company or any of
the Subsidiaries or that any such executive or key employee is subject
to any noncompete, nondisclosure, confidentiality, employment,
consulting or similar agreement with any third party in conflict with
the present or proposed business activities of the Company or any of
the Subsidiaries.
4. REPRESENTATIONS AND WARRANTIES OF THE SELLING
STOCKHOLDER. The Selling Stockholder represents and warrants to each
Underwriter that:
(a) the Selling Stockholder is and at the time of
delivery of the Shares to be sold by the Selling Stockholder will be
the lawful owner of the number of Shares to be sold by the Selling
Stockholder pursuant to this Agreement and, at the time of delivery
thereof, will have valid and marketable title to such Shares, and upon
delivery of and payment for such Shares the Underwriters will acquire
valid and marketable title to such Shares free and clear of any claim,
lien, encumbrance, security interest, community property right,
restriction on transfer or other defect in title (other than those
imposed by the Act and the securities laws of certain jurisdictions),
assuming each of the Underwriters has purchased the Shares purchased
by it in good faith and without notice of any adverse claim;
(b) the Selling Stockholder has and at the time
of delivery of such Shares will have full legal right, power and
capacity, and any approval required by law to sell, assign, transfer
and deliver such Shares in the manner provided in this Agreement;
(c) this Agreement and the Selling Stockholder's
Custody Agreement and Power of Attorney (the "Custody Agreement and
Power of Attorney"), dated as of __________, 1998, by and among the
Selling Stockholder, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Esq., as the Attorney-in-Fact
for and on behalf of the Selling Stockholder (the "Attorney-in-Fact")
and ▇▇▇▇▇ & Samson, P.A., as the Custodian, have been duly executed
and delivered by the Selling Stockholder and are legal, valid and
binding agreements of the Selling Stockholder in accordance with their
terms, except as rights to indemnity and contribution hereunder may be
limited by federal or state securities laws and except as the
enforceability hereof and thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally and general principles of equity;
(d) the Selling Stockholder has duly and
irrevocably authorized the Attorney-in-Fact, on behalf of the Selling
Stockholder, to execute and deliver this Agreement and any other
document necessary or desirable in connection with the transactions
contemplated hereby and to deliver the Shares to be sold by the
Selling Stockholder and receive payment therefor pursuant hereto;
(e) the sale of the Shares by the Selling
Stockholder pursuant hereto is not prompted by any material adverse
information concerning the Company; and all
10
12
information furnished in writing by or on behalf of the Selling
Stockholder specifically for use in the Registration Statement and
Prospectus, and any supplement or amendment thereto, is and will be
when the Registration Statement became effective and at all times
subsequent thereto up to the time of purchase and the additional time
of purchase, true and correct and complete and at all such times did
not and will not contain any untrue statement of material fact or omit
to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading;
(f) the consummation of the transactions
contemplated hereby and by the Custody Agreement and Power of Attorney
and the fulfillment of the terms hereof and thereof will not
constitute a breach or violation of or default under any trust,
indenture, agreement or other instrument to which the Selling
Stockholder is a party or by which the Selling Stockholder is bound;
and
(g) the Selling Stockholder is not aware, without
having made any independent investigation except as otherwise may be
required under the circumstances, that any of the representations and
warranties set forth in Section 3 of this Agreement is untrue or
inaccurate in any material respect.
5. CERTAIN COVENANTS OF THE COMPANY. The Company hereby
agrees:
(a) to furnish such information as may be
required and otherwise to cooperate in qualifying the Shares for
offering and sale under the securities or Blue Sky laws of such states
as you may designate and to maintain such qualifications in effect so
long as required for the distribution of the Shares; provided, that,
the Company shall not be required to qualify as a foreign corporation
or to consent to the service of process under the laws of any such
state (except service of process with respect to the offering and sale
of the Shares); and promptly to advise you of the receipt by the
Company of any notification with respect to the suspension of the
qualification of the Shares for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose;
(b) to make available to you in New York City, as
soon as practicable after the Registration Statement becomes
effective, and thereafter from time to time to furnish to the
Underwriters, at the Company's expense, as many copies of the
Prospectus (or of the Prospectus as amended or supplemented if the
Company shall have made any amendment or supplement thereto after the
effective date of the Registration Statement) as the Underwriters may
request for the purposes contemplated by the Act;
(c) to advise you promptly and (if requested by
you) to confirm such advice in writing (i) when the Registration
Statement has become effective and when any post-effective amendment
thereto becomes effective and (ii) if Rule 430A under the Act is used,
when the Prospectus is filed with the Commission pursuant to Rule
424(b) under the Act, if required under the Act (which the Company
agrees to file in a timely manner under such Rule);
11
13
(d) to advise you promptly, confirming such
advice in writing, of any request by the Commission for amendments or
supplements to the Registration Statement or the Prospectus or for
additional information with respect thereto, or of notice of
institution of proceedings for, or the entry of, a stop order
suspending the effectiveness of the Registration Statement and, if the
Commission should enter a stop order suspending the effectiveness of
the Registration Statement, to make every reasonable effort to obtain
the lifting or removal of such order as soon as possible; to advise
you promptly of any proposal to amend or supplement the Registration
Statement or the Prospectus and to file no such amendment or
supplement to which you shall object in writing;
(e) to furnish to you and, upon request, to each
of the other Underwriters for a period of five years from the date of
this Agreement (i) copies of all reports or other communications which
the Company shall send to its stockholders or from time to time shall
publish or publicly disseminate, (ii) copies of all annual, quarterly
and current reports filed with the Commission on Forms 10-K, 10-Q and
8-K, or such other similar form as may be designated by the Commission
and (iii) so long as you continue to make a market in the Common Stock
and you agree to treat as confidential such information which has not
been, or will not be, publicly disclosed, such other information
concerning the business and financial condition of the Company as you
reasonably may request;
(f) to advise the Underwriters promptly of the
happening of any event known to the Company within the time during
which a prospectus relating to the Shares is required to be delivered
under the Act which, in the judgment of the Company, would require the
making of any change in the Prospectus then being used so that the
Prospectus would not include an untrue statement of a material fact or
omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they are made,
not misleading and, during such time, promptly to prepare and furnish,
at the Company's expense, to the Underwriters such amendments or
supplements to such Prospectus as may be necessary to reflect any such
change in such quantities as requested by the Underwriters, and to
furnish you a copy of such proposed amendment or supplement before
filing any such amendment or supplement with the Commission;
(g) to make generally available to its security
holders, and to deliver to you, an earnings statement of the Company
(which need not be audited and which will satisfy the provisions of
Section 11(a) of the Act including, at the option of the Company, Rule
158 of the Act) covering a period of 12 months beginning after the
effective date of the Registration Statement but ending not later than
15 months after the date of the Registration Statement, as soon as is
reasonably practicable after the termination of such 12-month period;
(h) to furnish to its stockholders as soon as
practicable after the end of each fiscal year an annual report
(including a balance sheet and statements of income, stockholders'
equity and changes in financial position of the Company certified by
independent public accountants) and, as soon as practicable after the
end of each of the first three quarters of each fiscal year (beginning
with the fiscal quarter ending after the
12
14
effective date of the Registration Statement), summary financial
information of the Company for such quarter in reasonable detail;
(i) to furnish to you three signed copies of the
Registration Statement, as initially filed with the Commission, and of
all amendments thereto (including all exhibits thereto and documents
incorporated by reference therein) and sufficient conformed copies of
the foregoing (other than exhibits) for distribution of a copy to each
of the other Underwriters;
(j) to furnish to you as early as practicable
prior to the time of purchase and the additional time of purchase, as
the case may be, but not later than two business days prior thereto, a
copy of the latest available unaudited interim consolidated financial
statements, if any, of the Company and the Subsidiaries that have been
read by the Company's independent certified public accountants as
stated in their letter to be furnished pursuant to Section 8(b);
(k) to furnish to you, contemporaneous with
filing with the Commission, subsequent to the effective date of the
Registration Statement and during the period referred to in Section
5(e), a copy of any document filed by the Company pursuant to Section
12, 13, 14 or 15(d) of the Exchange Act;
(l) to apply the net proceeds from the sale of
the Shares sold by the Company in the manner set forth under the
caption "Use of Proceeds" in the Registration Statement and the
Prospectus; and
(m) to refrain from investing the proceeds from
the sale of the Shares sold by the Company in a manner to cause the
Company or any of the Subsidiaries to become an "investment company"
within the meaning of the Investment Company Act of 1940, as amended.
6. CERTAIN OTHER COVENANTS OF THE COMPANY AND OF THE
SELLING STOCKHOLDERS. The Company further agrees, and the Selling Stockholders
agrees, with each Underwriter as follows:
(a) (i) as to the Company, not to offer, sell,
contract to sell, grant any option to sell, transfer or otherwise
dispose of, directly or indirectly, any shares of Common Stock or
securities convertible into or exchangeable or exercisable for Common
Stock with respect to any shares of Common Stock or permit the
registration under the Act of any shares of Common Stock, except for
the registration of the Shares and the sales to you pursuant to this
Agreement and except that the Company may issue Common Stock and stock
options pursuant to the Company's existing stock option plans, as
described in the Registration Statement, for a period commencing on
the date hereof and continuing for 90 days after the date of the
Prospectus, without the prior written consent of SBC Warburg Dillon
Read Inc., and (ii) as to the Selling Stockholder, to the effect set
forth in Exhibit I hereto;
13
15
(b) in such proportion (aggregating 100%) as they
shall agree between themselves, to pay all out-of-pocket expenses,
fees and taxes incurred by them (other than any transfer taxes and
fees and disbursements of your counsel except as set forth under
Section 7 or clause (iv) of this Section 6(b) and any advertising
expenses incurred by you in connection with your offering of the
Shares) in connection with (i) the preparation and filing of the
Registration Statement, each Preliminary Prospectus, the Prospectus
and any amendment or supplement thereto, and the printing and
furnishing of copies of each thereof to you and to dealers (including
costs of mailing and shipment), (ii) the sale and delivery of the
Shares by the Selling Stockholder, (iii) the printing of this
Agreement, any Agreement Among Underwriters and any dealer agreements,
and the printing and furnishing of copies of each thereof to you and
to dealers (including costs of mailing and shipment), (iv) the
qualification of the Shares for offering and sale under state laws as
aforesaid (including legal fees and filing fees and other
disbursements of your counsel in connection therewith) and the
printing and furnishing of copies of the Blue Sky Surveys to you and
to dealers, (v) the filing for review of the public offering of the
Shares by the NASD and (vi) the performance of the Company's and the
Selling Stockholder's other obligations hereunder; and
(c) the Shares represented by the certificates
held in custody pursuant to the Custody Agreement and Power of
Attorney are for the benefit of and coupled with and subject to the
interests of the Underwriters and the Selling Stockholder hereunder,
and that the arrangement for such custody and the appointment of the
Attorney-in-Fact is irrevocable; the obligations of the Selling
Stockholder shall not be terminated by operation of law, whether by
the death or incapacity of the Selling Stockholder, or any other
event; of the Selling Stockholder should die or become incapacitated
or any other event occur before the delivery of the Shares hereunder,
certificates for the Shares to be sold by the Selling Stockholder
shall be delivered on behalf of the Selling Stockholder in accordance
with the terms and conditions of this Agreement and the Custody
Agreement and Power of Attorney, and action taken by the
Attorney-in-Fact under the Custody Agreement and Power of Attorney
shall be as valid as if such death, incapacity or other event had not
occurred, whether or not the Custodian or the Attorney-in-Fact shall
have notice of such liquidation, dissolution, death, incapacity or
other event.
7. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the
Shares are not delivered for any reason other than the termination of this
Agreement pursuant to the second paragraph of Section 9 or the default by one
or more of the Underwriters in its or their respective obligations hereunder,
the Company and the Selling Stockholder, in such proportion (aggregating 100%)
as they shall agree between themselves, shall reimburse the Underwriters for
all of their reasonable out-of-pocket expenses, including the reasonable fees
and disbursements of their counsel.
8. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several
obligations of the Underwriters hereunder are subject to the accuracy of the
representations and warranties on the part of the Company and the Selling
Stockholder on the date hereof and at the time of purchase (and the several
obligations of the Underwriters at the additional time of purchase are subject
to the accuracy of the representations and warranties on the part of the
Company and the Selling
14
16
Stockholder on the date hereof and at the time of purchase (unless previously
waived) and at the additional time of purchase (any representation and warranty
made as of a specified date shall be true and correct as of the additional time
of purchase), as the case may be), the performance by each of the Company and
the Selling Stockholder of its and his obligations hereunder and to the
following conditions:
(a) the Company shall furnish to you at the time of
purchase and at the additional time of purchase, as the case may be,
an opinion of ▇▇▇▇▇ & ▇▇▇▇▇▇, P.A., counsel for the Company and the
Selling Stockholder, addressed to the Underwriters, and dated the time
of purchase or the additional time of purchase, as the case may be,
with reproduced copies for each of the other Underwriters and in form
reasonably satisfactory to Powell, Goldstein, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP,
counsel for the Underwriters, stating that:
(i) the Company has been duly
organized and is validly existing as a corporation in good
standing under the laws of the State of Delaware, with full
corporate power and authority to own its properties and
conduct its business as described in the Registration
Statement and the Prospectus and to execute and deliver this
Agreement and to issue, sell and deliver the Shares to be
issued and sold by it as herein contemplated;
(ii) each of the Subsidiaries has
been duly organized and is validly existing as a corporation
in good standing under the laws of the state of its
jurisdiction of incorporation, with full corporate power and
authority to own its properties and to conduct its business as
described in the Registration Statement and the Prospectus; to
the best of such counsel's knowledge, the Company does not own
any interest in any other corporation, joint venture or
partnership;
(iii) all of the issued and
outstanding shares of each of the Subsidiaries are owned
directly or indirectly by the Company, except for directors'
qualifying shares; all of such shares have been duly
authorized and validly issued and are fully paid and
nonassessable and except as described in the Prospectus are so
owned free and clear of any pledge, lien, encumbrance,
security interest, preemptive right or other claim; there are
no outstanding rights, options or other agreements of any kind
with respect to the capital stock of the Subsidiaries;
(iv) the Company and each of the
Subsidiaries are duly qualified or licensed to do business as
a foreign corporation by each jurisdiction in which they
conduct their business or own property and in which the
failure, individually or in the aggregate, to be so licensed
or qualified could have a material adverse effect on the
properties, assets, operations, business or condition
(financial or otherwise) of the Company and the Subsidiaries
taken as a whole;
(v) (A) this Agreement has been
duly authorized, executed and delivered by the Company and is
a legal, valid and binding
15
17
agreement of the Company enforceable in accordance with its
terms, except as rights to indemnity and contribution
hereunder may be limited by federal or state securities laws
and except as the enforceability hereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting creditors' rights generally and general
principles of equity; and (B) the Shares to be issued and sold
by the Company hereunder, when issued and delivered to and
paid for by the Underwriters as contemplated hereby, will be
duly authorized and validly issued and fully paid and
nonassessable, free and clear of any pledge, lien,
encumbrance, security interest, preemptive right or other
claim.
(vi) (A) the Company has an
authorized share capitalization as set forth under the heading
"Capitalization" in the Registration Statement and the
Prospectus; and (B) the outstanding shares of capital stock of
the Company have been duly authorized and validly issued and
are fully paid, nonassessable and free of statutory and
contractual preemptive rights;
(vii) (A) the capital stock of the
Company, including the Shares, conforms in all material
respects to the description thereof contained in the
Registration Statement and the Prospectus; and (B) the
certificates for the Shares are in due and proper form and the
holders of the Shares will not be subject to personal
liability by reason of being such holders;
(viii) the Registration Statement and
the Prospectus (except as to the financial statements and
schedules contained therein as to which such counsel need
express no opinion) comply as to form in all material respects
with the requirements of the Act;
(ix) the Registration Statement has
become effective under the Act and, to the best of such
counsel's knowledge after due inquiry, no stop order
proceedings with respect thereto are pending or threatened
under the Act;
(x) no approval, authorization,
consent or order of or filing with any national, state or
local governmental or regulatory commission, board, body,
authority or agency is required in connection with the sale of
the Shares as contemplated hereby other than such as has been
obtained or made (specifying the same) and registration of the
Shares under the Act (except such counsel need express no
opinion as to any necessary qualification under the securities
or Blue Sky laws of the various jurisdictions in which the
Shares are being offered by the Underwriters);
(xi) the execution, delivery and
performance of this Agreement by the Company and the
consummation by the Company of the transactions contemplated
hereby do not and will not conflict with, or result in any
breach of, or constitute a default under (nor constitute any
event which with notice, lapse of time or both would
constitute a breach of or default under), any
16
18
provision of the charter or bylaws of the Company or any of
the Subsidiaries or any provision of any partnership agreement
or under any provision of any license, indenture, lease,
mortgage, deed of trust, bank loan, credit agreement, material
supply or vendor agreement or other material agreement or
instrument known to such counsel to which the Company or any
of the Subsidiaries is a party or by which the Company or any
of the Subsidiaries or their properties are bound or affected,
or under any law, regulation or rule or any decree, judgment
or order applicable to the Company or any of the Subsidiaries,
which conflict, breach or default would, individually or in
the aggregate, have a material adverse effect on the
properties, assets, operations, business or condition
(financial or otherwise) of the Company and the Subsidiaries,
taken as a whole;
(xii) to the best of such counsel's
knowledge after due inquiry, neither the Company nor any of
the Subsidiaries is in breach of, or in default under (nor has
any event occurred which with notice, lapse of time or both
would constitute a breach of, or default under), any license,
indenture, lease, mortgage, deed of trust, bank loan, credit
agreement, material supply or vendor agreement or any other
agreement or instrument to which the Company or any of the
Subsidiaries is a party or by which the Company or any of the
Subsidiaries or their properties are bound or affected or
under any law, regulation or rule or any decree, judgment or
order applicable to the Company or any of the Subsidiaries,
which breach or default would, individually or in the
aggregate, have a material adverse effect on the properties,
assets, operations, business or condition (financial or
otherwise) of the Company and the Subsidiaries, taken as a
whole;
(xiii) to the best of such counsel's
knowledge after due inquiry, there are no contracts, licenses,
agreements, leases or documents of a character which are
required to be filed as exhibits to the Registration Statement
or to be summarized or described in the Prospectus which have
not been so filed, summarized or described;
(xiv) to the best of such counsel's
knowledge after due inquiry, there are no actions, suits or
proceedings pending or threatened against the Company or any
of the Subsidiaries or any of their properties, at law or in
equity or before or by any commission, board, body, authority
or agency which are required to be described in the Prospectus
but are not so described;
(xv) to the best of such counsel's
knowledge after due inquiry, each person who has the right,
contractual or otherwise, to request the Company to register
pursuant to the Act shares of capital stock of the Company
upon the sale of the Shares to the Underwriters hereunder or
who has preemptive rights, rights of first refusal or other
rights to purchase any of the Shares, has exercised or waived
their right to include any such shares in this offering, or
was excluded from any preemptive rights, rights of first
refusal or other purchase rights, in accordance with the terms
thereof;
17
19
(xvi) the documents incorporated by
reference in the Registration Statement and Prospectus, when
they were filed (or, if an amendment with respect to any such
document was filed, when such amendment was filed), complied
as to form in all material respects with the Exchange Act
(except as to the financial statements and schedules and other
financial and statistical data contained or incorporated by
reference therein, as to which such counsel need express no
opinion);
(xvii) neither the Company nor any of
the Subsidiaries is an "investment company" or a person
"controlled" by an "investment company" within the meaning of
the Investment Company Act of 1940, as amended;
(xviii) the sales of securities by the
Company described in Item 15 of the Registration Statement
were exempt from the registration requirements of the Act;
(xix) this Agreement and the Custody
Agreement and Power of Attorney have been duly executed and
delivered by the Selling Stockholder; the Custody Agreement
and Power of Attorney is a legal, valid and binding agreement
of the Selling Stockholder enforceable in accordance with its
terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting creditors' rights generally and general
principles of equity;
(xx) the Selling Stockholder has
full legal right and power, and has obtained any authorization
or approval required by law (other than those imposed by the
Act and the securities or Blue Sky laws of certain
jurisdictions), to sell, assign, transfer and deliver the
Shares to be sold by the Selling Stockholder in the manner
provided in this Agreement;
(xxi) delivery of certificates for
the Shares to be sold by the Selling Stockholder pursuant
hereto will pass title thereto to the Underwriters severally,
free and clear of any claim, lien, encumbrance, security
interest, community property right, restriction on transfer or
other defect in title assuming that the several Underwriters
are good faith purchasers and without notice of any adverse
claim;
(xxii) to the best of such counsel's
knowledge after due inquiry, the consummation of the
transactions contemplated hereby and by the Custody Agreement
and Power of Attorney and the fulfillment of the terms hereof
and thereof will not constitute a breach or violation of or
default under any trust, indenture, agreement or other
instrument to which the Selling Stockholder is a party or by
which the Selling Stockholder is bound;
(xxiii) the Attorney-in-Fact has been
duly authorized by the Selling Stockholder to execute and
deliver, on behalf of the Selling
18
20
Stockholder, this Agreement and any other document necessary
or desirable in connection with the transactions contemplated
hereby and to deliver the Shares to be sold by the Selling
Stockholder and receive payment therefor pursuant hereto;
(xxiv) no approval, authorization,
consent or order of or filing with any federal, state or local
governmental or regulatory commission, board, body, authority
or agency is required in connection with the sale of the
Shares to be sold by the Selling Stockholder as contemplated
hereby other than registration of such Shares under the Act
(except such counsel need express no opinion as to any
necessary qualification under the state securities or Blue Sky
laws of the various jurisdictions in which the Shares are
being offered by the Underwriters); and
(xxv) to the best of such counsel's
knowledge, the statements in the Prospectus under the caption
"Principal and Selling Stockholders" insofar as such
statements constitute a summary of the matters referred to
therein present fairly the information called for with respect
to such matters.
In addition, such counsel shall state that such counsel have
participated in conferences with officers and other representatives of
the Company, representatives of the independent public accountants of
the Company, the Selling Stockholder and representatives of the
Underwriters at which the contents of the Registration Statement and
the Prospectus were discussed and, although such counsel is not
passing upon and does not assume responsibility for the accuracy,
completeness or fairness of the statements contained in the
Registration Statement or the Prospectus (except as and to the extent
stated in clause (xv) of this Section 8(a), on the basis of the
foregoing nothing has come to the attention of such counsel that
causes them to believe that the Registration Statement or any
amendment thereto at the time such Registration Statement or amendment
became effective and at all times up to and including the time of
purchase or additional time of purchase, as the case may be, contained
an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading, or that the Prospectus or any supplement
thereto at the date of such Prospectus or such supplement, and at all
times up to and including the time of purchase or additional time of
purchase, as the case may be, contained an untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading (it
being understood that such counsel need express no comment with
respect to the financial statements and schedules included in the
Registration Statement or the Prospectus).
In rendering such opinion, counsel may rely, to the extent
they deem such reliance proper, upon an opinion or opinions, each
dated the time of purchase or the additional time of purchase, as the
case may be, of other counsel with respect to Daisytek (Canada) Inc.,
Working Capital Canada, Inc., Daisytek Latin America, Inc., Daisytek
De Mexico S.A. de C.V. Priority Fulfillment Services of Canada, Inc.,
Daisytek De Mexico Services
19
21
S.A. de C.V. and Daisytek Australia Pty. Ltd.; provided, that (i) each
such local counsel is acceptable to you and your counsel, (ii) counsel
shall state in their opinion that they have no reason to believe that
they and you are not justified in relying thereon and (iii) such
reliance is expressly authorized by each opinion so relied upon and a
copy of each such opinion is delivered to you and is in form and
substance satisfactory to you and your counsel.
(b) You shall have received from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP
letters dated, respectively, the date of this Agreement and the time
of purchase and additional time of purchase, as the case may be, and
addressed to the Underwriters (with reproduced copies of each of the
Underwriters) in the forms heretofore approved by you.
(c) You shall have received at the time of purchase and
at the additional time of purchase, as the case may be, the favorable
opinion of Powell, Goldstein, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, counsel for the
Underwriters, dated the time of purchase or the additional time of
purchase, as the case may be, as to the matters referred to in clauses
(v), (vii) (as to subclause (A) only) and (viii) of Section 8(a).
In addition, such counsel shall state that such counsel have
participated in conferences with officers and other representatives of
the Company, counsel for the Company and the Selling Stockholder,
representatives of the independent public accountants of the Company
and representatives of the Underwriters at which the contents of the
Registration Statement and the Prospectus and related matters were
discussed and, although such counsel is not passing upon and does not
assume any responsibility for the accuracy, completeness or fairness
of the statements contained in the Registration Statement and the
Prospectus (except as to matters referred to under clause (vii) (as to
subclause (A) only) of Section 8(a)), on the basis of the foregoing,
no facts have come to the attention of such counsel that cause them to
believe that the Registration Statement or any amendment thereto at
the time such Registration Statement or amendment became effective
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading or the Prospectus as of its date or
any supplement thereto as of its date and at the time of purchase or
the additional time of purchase, as the case may be, contained an
untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading (it being understood that such counsel need express no
comment with respect to the financial statements and schedules and
other financial and statistical data included in the Registration
Statement or the Prospectus).
(d) No amendment or supplement to the Registration
Statement or the Prospectus to which you object in writing shall be
filed prior to the time the Registration Statement becomes effective .
(e) The Registration Statement shall become effective at
or before 5:00 P.M., New York City time, on the date of this Agreement
and, if Rule 430A under the Act is
20
22
applicable, the Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) under the Act at or before 5:00 P.M., New York
City time, on the second full business day after the date of this
Agreement; provided, however, that the Company, the Selling
Stockholder and you and any group of Underwriters, including you, who
have agreed hereunder to purchase in the aggregate at least 50% of the
Firm Shares from time to time may agree in writing or by telephone,
confirmed in writing, on a later date.
(f) Prior to the time of purchase or the additional time
of purchase, as the case may be: (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued
under the Act or proceedings initiated under Section 8(d) or 8(e) of
the Act; (ii) the Registration Statement and all amendments thereto,
or modifications thereof, if any, shall not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading; and (iii) the Prospectus and all amendments or supplements
thereto, or modifications thereof, if any, shall not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.
(g) Between the time of execution of this Agreement and
the time of purchase or the additional time of purchase, as the case
may be, (i) no material and unfavorable change, financial or otherwise
(other than as specifically referred to in the Registration Statement
and the Prospectus), in the business, condition or prospects of the
Company and the Subsidiaries, taken as a whole, shall occur or become
known, (ii) no transaction which is material and unfavorable to the
Company and the Subsidiaries, taken as a whole, shall have been
entered into by the Company or any of the Subsidiaries and (iii) there
has not been any obligation, contingent or otherwise, directly or
indirectly incurred by the Company or any of the Subsidiaries which is
material to the Company and the Subsidiaries, taken as a whole.
(h) The Company, at the time of purchase or additional
time of purchase, as the case may be, shall have delivered to you a
certificate of the President, Chief Executive Officer and Chief
Operating Officer and the Vice President-Finance, Chief Financial
Officer, Chief Accounting Officer and Treasurer of the Company to the
effect that the representations and warranties of the Company as set
forth in this Agreement and the conditions set forth in Section 8(f)
and Section 8(g) have been met and that they are true and correct as
of each such date.
(i) You shall have received a signed letter, dated the
date of this Agreement, from (i) The ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ 1995 Interest
in Possession Settlement (No. 2) ▇▇▇▇▇ ▇. Heap, The ▇▇▇▇▇ ▇▇▇▇ Life
Interest Settlement (No. 10), ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
▇▇., ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇ ▇.▇. Vikanis to the effect set forth
in Exhibit I hereto and (ii) each of [▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇. WHARF
AND ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇] to the effect set forth in Exhibit II hereto.
21
23
(j) The Company and the Selling Stockholder shall have
furnished to you such other documents and certificates as to the
accuracy and completeness of any statement in the Registration
Statement or the Prospectus as of the time of purchase and the
additional time of purchase, as the case may be, as you reasonably may
request.
(k) The Company and the Selling Stockholder shall have
performed such of their respective obligations under this Agreement as
are to be performed by the terms hereof at or before the time of
purchase and at or before the additional time of purchase, as the case
may be.
(l) The Shares to be issued and sold by the Company
hereby shall have been listed for trading on the Nasdaq National
Market upon official notice of issuance.
(m) The Attorney-in-Fact, at the time of purchase or
additional time of purchase, as the case may be, shall have delivered
to you a certificate to the effect that the Attorney-in-Fact is not
aware that any of the representations and warranties of the Selling
Stockholder as set forth in this Agreement are not true and correct as
of such date.
9. EFFECTIVE DATE OF AGREEMENT; TERMINATION. This
Agreement shall become effective (i) if Rule 430A under the Act is not
applicable, when you shall have received notification of the effectiveness of
the Registration Statement or (ii) if Rule 430A under the Act is applicable,
when the parties hereto have executed and delivered this Agreement.
The obligations of the several Underwriters hereunder shall be
subject to termination in the absolute discretion of you or any group of
Underwriters (which may include you) which has agreed to purchase in the
aggregate at least 50% of the Firm Shares if, at any time prior to the time of
purchase or, with respect to the purchase of any Additional Shares, the
additional time of purchase, as the case may be, trading in securities on the
New York Stock Exchange shall have been suspended or minimum prices shall have
been established on the New York Stock Exchange or if a banking moratorium
shall have been declared either by the United States or New York State
authorities, or if the United States shall have declared war in accordance with
its constitutional processes or there shall have occurred any material outbreak
or escalation of hostilities or other national or international calamity or
crisis of such magnitude in its effect on the financial markets of the United
States as, in your judgment or in the judgment of such group of Underwriters,
to make it impracticable to market the Shares.
If you or any group of Underwriters elect to terminate this
Agreement as provided in this Section 9, the Company, the Selling Stockholder
and each other Underwriter shall be notified promptly by letter or telegram.
If the sale to the Underwriters of the Shares, as contemplated
by this Agreement, is not carried out by the Underwriters for any reason
permitted under this Agreement or if such sale is not carried out because the
Company or the Selling Stockholder, as the case may be, shall be unable to
comply with any of the terms of this Agreement, the Company or the Selling
Stockholder, as the case may be, shall not be under any obligation or liability
under this Agreement (except to the extent provided in Sections 6(b), 7 and
11), and the Underwriters shall
22
24
be under no obligation or liability to the Company and the Selling Stockholder
under this Agreement (except to the extent provided in Section 11) or to one
another hereunder.
10. INCREASE IN UNDERWRITERS' COMMITMENTS. If any
Underwriter shall default in its obligation to take up and pay for the Firm
Shares to be purchased by it hereunder and if the number of Firm Shares which
all Underwriters so defaulting shall have agreed but failed to take up and pay
for does not exceed 10% of the total number of Firm Shares, the non-defaulting
Underwriters shall take up and pay for (in addition to the aggregate principal
amount of Firm Shares they are obligated to purchase pursuant to Section 1) the
number of Firm Shares agreed to be purchased by all such defaulting
Underwriters as hereinafter provided. Such Shares shall be taken up and paid
for by such non-defaulting Underwriter or Underwriters in such amount or
amounts as you may designate with the consent of each Underwriter so designated
or, in the event no such designation is made, such Shares shall be taken up and
paid for by all non-defaulting Underwriters pro rata in proportion to the
aggregate number of Firm Shares set opposite the names of such non-defaulting
Underwriters in Schedule A.
Without relieving any defaulting Underwriter from its
obligations hereunder, the Company and the Selling Stockholder agree with the
non-defaulting Underwriters that they will not sell any Firm Shares hereunder
unless all of the Firm Shares are purchased by the Underwriters (or by
substituted underwriters selected by you with the approval of the Company or
selected by the Company with your approval).
If a new Underwriter or Underwriters are substituted by the
Underwriters or by the Company for a defaulting Underwriter or Underwriters in
accordance with the foregoing provision, the Company or you shall have the
right to postpone the time of purchase for a period not exceeding five business
days in order that any necessary changes in the Registration Statement and the
Prospectus and other documents may be affected.
The term Underwriter as used in this Agreement shall refer to
and include any Underwriter substituted under this Section 10 with like effect
as if such substituted Underwriter had originally been named in Schedule A.
11. INDEMNITY BY THE COMPANY, THE SELLING STOCKHOLDER AND
THE UNDERWRITERS. (a) The Company and the Selling Stockholder, jointly and
severally, agree to indemnify, defend and hold harmless each Underwriter and
any person who controls any Underwriter within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act, from and against any loss, expense,
liability or claim (including the reasonable cost of investigation) which,
jointly or severally, any such Underwriter or any such controlling person may
incur under the Act, the Exchange Act or otherwise insofar as such loss,
expense, liability or claim arises out of or is based upon any untrue statement
or alleged untrue statement of a material fact contained in the Registration
Statement (or in the Registration Statement as amended by any post-effective
amendment thereof by the Company) or in a Prospectus (the term Prospectus for
the purpose of this Section 11 being deemed to include any Preliminary
Prospectus, the Prospectus and the Prospectus as amended or supplemented by the
Company), or arises out of or is based upon any omission or alleged omission to
state a material fact required to be stated in either such Registration
Statement or such Prospectus or necessary to make the
23
25
statements made therein not misleading, except insofar as such loss, expense,
liability or claim arises out of or is based upon any untrue statement or
alleged untrue statement of a material fact contained in and in conformity with
information furnished in writing by any Underwriter through you to the Company
expressly for use with reference to such Underwriter in such Registration
Statement or such Prospectus or arises out of or is based upon any omission or
alleged omission to state a material fact in connection with such information
required to be stated in either such Registration Statement or such Prospectus
or necessary to make such information not misleading; provided, however, that
each Underwriter or such controlling person shall seek recovery under this
Section 11(a) and Section 11(c) only as follows: (i) such Underwriter or
controlling person shall first use reasonable efforts to recover any such loss,
expense, liability or claim from the Company and (ii) such Underwriter or
controlling person shall then be limited to recovering any amounts not
recovered in respect of such loss, expense, liability or claim under the
immediately preceding clause (i) from the Selling Stockholder in an amount up
to the net proceeds received by the Selling Stockholder (before deducting
expenses) from the sale of the Shares by the Selling Stockholder. The Company
and the Selling Stockholder may agree, between themselves and without limiting
the rights of the Underwriters under this Agreement, as to their respective
amounts of such liability for which they each shall be responsible.
If any action is brought against an Underwriter or controlling
person in respect of which indemnity may be sought against the Company or the
Selling Stockholder pursuant to the foregoing paragraph, such Underwriter shall
promptly notify the Company and the Selling Stockholder in writing of the
institution of such action and the Company and the Selling Stockholder shall
assume the defense of such action, including the employment of counsel and
payment of expenses. Such Underwriter or such controlling person shall have
the right to employ its or their own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of such Underwriter or of such
controlling person unless the employment of such counsel shall have been
authorized in writing by the Company and the Selling Stockholder in connection
with the defense of such action or the Company or the Selling Stockholder shall
not have employed counsel to have charge of the defense of such action or such
indemnified party or parties shall have reasonably concluded that there may be
defenses available to it or them which are different from or additional to
those available to the Company or the Selling Stockholder (in which case the
Company and the Selling Stockholder shall not have the right to direct the
defense of such action on behalf of the indemnified party or parties), in any
of which events such fees and expenses shall be borne by the Company and the
Selling Stockholder and paid as incurred (it being understood, however, that
the Company and the Selling Stockholder shall not be liable for the expenses of
more than one separate counsel in any one action or series of related actions
in the same jurisdiction representing the indemnified parties who are parties
to such action). Anything in this paragraph to the contrary notwithstanding,
neither the Company nor the Selling Stockholder shall be liable for any
settlement of any such claim or action effected without their written consent.
(b) Each Underwriter severally agrees to indemnify,
defend and hold harmless the Company, its directors and officers, the Selling
Stockholder and any person who controls the Company within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act from and against any
loss, expense, liability or claim (including the reasonable cost of
investigation) which, jointly or severally, the Company, the Selling
Stockholder or any such person may incur
24
26
under the Act or otherwise, insofar as such loss, expense, liability or claim
arises out of or is based upon any untrue statement or alleged untrue statement
of a material fact contained in and in conformity with information furnished in
writing by or on behalf of such Underwriter (such information so furnished in
writing shall be limited to the Underwriting section of the Preliminary
Prospectus and the Prospectus) through you to the Company expressly for use
with reference to such Underwriter in the Registration Statement (or in the
Registration Statement as amended by any post- effective amendment thereof by
the Company) or in a Prospectus, or arises out of or is based upon any omission
or alleged omission to state a material fact in connection with such
information required to be stated either in such Registration Statement or
Prospectus or necessary to make such information not misleading.
If any action is brought against the Company, the Selling
Stockholder or any such person in respect of which indemnity may be sought
against any Underwriter pursuant to the foregoing paragraph, the Company, the
Selling Stockholder or such person promptly shall notify such Underwriter and
you in writing of the institution of such action and such Underwriter shall
assume the defense of such action, including the employment of counsel and
payment of expenses. The Company, the Selling Stockholder or such person shall
have the right to employ its own counsel in any case, but the fees and expenses
of such counsel shall be at the expense of the Company, the Selling Stockholder
or such person unless the employment of such counsel shall have been authorized
in writing by such Underwriter in connection with the defense of such action or
such Underwriter shall not have employed counsel to have charge of the defense
of such action or such indemnified party or parties shall have reasonably
concluded that there may be defenses available to it or them which are
different from or additional to those available to such Underwriter (in which
case such Underwriter shall not have the right to direct the defense of such
action on behalf of the indemnified party or parties), in any of which events
such fees and expenses shall be borne by such Underwriter and paid as incurred
(it being understood, however, that such Underwriter shall not be liable for
the expenses of more than one separate counsel in any one action or series of
related actions in the same jurisdiction representing the indemnified parties
who are parties to such action). Anything in this paragraph to the contrary
notwithstanding, no Underwriter shall be liable for any settlement of any such
claim or action effected without the written consent of such Underwriter.
(c) If the indemnification provided for in this Section
11 is unavailable to or insufficient to hold harmless an indemnified party
under Section 11(a) or Section 11(b) in respect of any loss, expense, liability
or claim referred to therein, then each applicable indemnifying party, in lieu
of indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such loss, expense, liability
or claim (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Selling Stockholder on the one hand
and the Underwriters on the other hand from the offering of the Shares or (ii)
if the allocation provided by clause (i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Company and the Selling Stockholder on the one hand and of the Underwriters on
the other hand in connection with the statements or omissions which resulted in
such losses, expenses, liabilities or claims, as well as any other relevant
equitable considerations. The relative benefits received by the Company and
the Selling Stockholder on the one hand and the Underwriters on the other hand
shall be deemed to be in the same
25
27
proportion as the total proceeds from the offering (net of underwriting
discounts and commissions but before deducting expenses) received by the
Company and the Selling Stockholder bears to the total underwriting discounts
and commissions received by the Underwriters. The relative fault of the
Company and the Selling Stockholder on the one hand and the Underwriters on the
other hand shall be determined by reference to, among other things, whether the
untrue statement or alleged untrue statement of a material fact or omission or
alleged omission relates to information supplied by the Company, by the Selling
Stockholder or by the Underwriters (such information so furnished shall be
limited to the Underwriting section of the Preliminary Prospectus and
Prospectus) and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The amount
paid or payable by a party as a result of the losses, expenses, liabilities and
claims referred to above shall be deemed to include any legal or other fees or
expenses reasonably incurred by such party in connection with investigating or
defending any claim or action.
(d) The Company, the Selling Stockholder and the
Underwriters agree that it would not be just and equitable if contribution
pursuant to this Section 11 were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other
method of allocation that does not take account of the equitable considerations
referred to in Section 11(c). Notwithstanding the provisions of this Section
11, no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Shares underwritten by such
Underwriter and distributed to the public were offered to the public exceeds
the amount of any damages which such Underwriter otherwise has been required to
pay by reason of such untrue statement or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute pursuant to this Section 11 are several
in proportion to their respective underwriting commitments and not joint.
(e) The indemnity and contribution agreements contained
in this Section 11 and the covenants, representations and warranties of the
Company and the Selling Stockholder contained in this Agreement shall remain in
full force and effect regardless of any investigation made by or on behalf of
any Underwriter, or any person who controls any Underwriter within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act, or by or on behalf
of the Company, its directors and officers, the Selling Stockholder or any
person who controls the Company within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and shall survive any termination of this
Agreement or the issuance and delivery of the Shares. The Company, the Selling
Stockholder and each Underwriter agree promptly to notify the other of the
commencement of any litigation or proceeding against it and, in the case of the
Company, against any of the Company's officers and directors, in connection
with the issuance and sale of the Shares, or in connection with the
Registration Statement or the Prospectus.
12. NOTICES. Except as otherwise herein provided, all
statements, requests, notices and agreements shall be in writing or by telegram
and, if to the Underwriters, shall be sufficient in all respects if delivered
or sent to SBC Warburg Dillon Read Inc., ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Attention: Syndicate Department, if to the Company, shall be sufficient
in all respects if delivered or sent to the Company at the offices of the
26
28
Company at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention:
▇▇▇▇ ▇. ▇▇▇▇▇▇, President, Chief Executive Officer and Chief Operating Officer
and if to the Selling Stockholder, shall be sufficient in all respects, if
delivered or sent to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Esq., as Attorney-in-Fact for the
Selling Stockholder, at ▇▇▇▇▇ & ▇▇▇▇▇▇, P.A., ▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇.
13. CONSTRUCTION. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. THE
SECTION HEADINGS IN THIS AGREEMENT HAVE BEEN INSERTED AS A MATTER OF
CONVENIENCE OF REFERENCE AND ARE NOT A PART OF THIS AGREEMENT.
14. PARTIES AT INTEREST. The Agreement herein set forth
has been and is made solely for the benefit of the Underwriters, the Company,
the Selling Stockholder and the controlling persons, directors and officers
referred to in Section 11, and the respective successors, assigns, executors
and administrators. No other person, partnership, association or corporation
(including a purchaser, as such purchaser, from any of the Underwriters) shall
acquire or have any right under or by virtue of this Agreement.
15. COUNTERPARTS. This Agreement may be signed by the
parties in counterparts which together shall constitute one and the same
agreement among the parties.
16. MISCELLANEOUS. SBC Warburg Dillon Read Inc., an
indirect, wholly owned subsidiary of Swiss Bank Corporation, is not a bank and
is separate from any affiliated bank, including any U.S. branch or agency of
Swiss Bank Corporation. Because SBC Warburg Dillon Read Inc. is a separately
incorporated entity, it is solely responsible for its own contractual
obligations and commitments, including obligations with respect to sales and
purchases of securities. Securities sold, offered or recommended by SBC
Warburg Dillon Read Inc. are not deposits, are not insured by the Federal
Deposit Insurance Corporation, are not guaranteed by a branch or agency, and
are not otherwise an obligation or responsibility of a branch or agency.
A lending affiliate of SBC Warburg Dillon Read Inc. may have
lending relationships with issuers of securities underwritten or privately
placed by SBC Warburg Dillon Read Inc. To the extent required under the
securities laws, prospectuses and other disclosure documents for securities
underwritten or privately placed by SBC Warburg Dillon Read Inc. will disclose
the existence of any such lending relationships and whether the proceeds of the
issue will be used to repay debts owed to affiliates of SBC Warburg Dillon Read
Inc.
Without your prior written approval, the U.S. branches and
agencies of Swiss Bank Corporation will not share with SBC Warburg Dillon Read
Inc. any non-public information concerning you, and SBC Warburg Dillon Read
Inc. will not share any non-public information received from you with any of
such U.S. branches and agencies of Swiss Bank Corporation.
If the foregoing correctly sets forth the understanding among
the Company, the Selling Stockholder and the Underwriters, please so indicate
in the space provided below for
27
29
such purpose, whereupon this letter and your acceptance shall constitute a
binding agreement among the Company, the Selling Stockholder and the
Underwriters, severally.
Very truly yours,
DAISYTEK INTERNATIONAL CORPORATION
By:
----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President, Chief Executive Officer
and Chief Operating Officer
▇▇▇▇▇ ▇. HEAP
By:
----------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Esq.,
as Attorney-in-Fact acting on
behalf of the Selling Stockholder
Accepted and agreed to as of
the date first above written,
on behalf of themselves,
PaineWebber Incorporated and
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Company, L.L.C.
and the other several Underwriters
named in Schedule A
SBC WARBURG DILLON READ INC., as
Managing Underwriter
By:
---------------------------------------
Name:
Title:
By:
----------------------------------------
Name:
Title:
28
30
SCHEDULE A
Number of
Underwriter Firm Shares
----------- -----------
SBC Warburg Dillon Read Inc.
------
PaineWebber Incorporated
------
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Company, L.L.C.
------
------------------------------------------- ------
------------------------------------------- ------
------------------------------------------- ------
------------------------------------------- ------
------------------------------------------- ------
------------------------------------------- ------
------------------------------------------- ------
------------------------------------------- ------
------------------------------------------- ------
Total ------
31
EXHIBIT I
---------, 1998
SBC Warburg Dillon Read Inc.
PaineWebber Incorporated
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Company, L.L.C.
As Representatives of the
several Underwriters
c/o SBC Warburg Dillon Read Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Reference is made to that certain proposed Underwriting Agreement (the
"Underwriting Agreement") by and among Daisytek International Corporation, a
Delaware corporation (the "Company"), the Selling Stockholder (as defined in
the Underwriting Agreement), and SBC Warburg Dillon Read Inc., PaineWebber
Incorporated and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Company, L.L.C. as representatives of the
several underwriters named in Schedule A to the Underwriting Agreement (the
"Underwriters"). Capitalized terms used herein and not otherwise defined shall
have the meanings ascribed to them in the Underwriting Agreement.
In order to induce the Underwriters to enter into the Underwriting
Agreement and to consummate the transactions contemplated therein, and pursuant
to, and in compliance with, Section 8(i) of the Underwriting Agreement, the
undersigned hereby agrees not to offer, sell, contract to sell, grant any
option to sell, transfer or otherwise dispose of, directly or indirectly, any
shares of Common Stock or securities convertible into or exchangeable or
exercisable for Common Stock, except as provided below and except for sales to
you pursuant to the Underwriting Agreement, for a period of 90 days from the
date of the Prospectus (the "Lock-up Period"), without the prior written
consent of SBC Warburg Dillon Read Inc.; provided, however, that upon prior
written notice to SBC Warburg Dillon Read Inc.
Very truly yours,
-----------------------------------
Name:
------------------------------
32
EXHIBIT II
------------, 1998
SBC Warburg Dillon Read Inc.
PaineWebber Incorporated
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Company, L.L.C.
As Representatives of the
several Underwriters
c/o SBC Warburg Dillon Read Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Reference is made to that certain proposed Underwriting Agreement (the
"Underwriting Agreement") by and among Daisytek International Corporation, a
Delaware corporation (the "Company"), the Selling Stockholder (as defined in
the Underwriting Agreement), and SBC Warburg Dillon Read Inc., PaineWebber
Incorporated and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Company, L.L.C. as representatives of the
several underwriters named in Schedule A to the Underwriting Agreement (the
"Underwriters"). Capitalized terms used herein and not otherwise defined shall
have the meanings ascribed to them in the Underwriting Agreement.
In order to induce the Underwriters to enter into the Underwriting
Agreement and to consummate the transactions contemplated therein, and pursuant
to, and in compliance with, Section 8(i) of the Underwriting Agreement, the
undersigned hereby agrees not to offer, sell, contract to sell, grant any
option to sell, transfer or otherwise dispose of, directly or indirectly, any
shares of Common Stock or securities convertible into or exchangeable or
exercisable for Common Stock, except as provided below and except for sales to
you pursuant to the Underwriting Agreement, for a period of 90 days from the
date of the Prospectus (the "Lock-up Period"), without the prior written
consent of SBC Warburg Dillon Read Inc.; provided, however, that upon prior
written notice to SBC Warburg Dillon Read Inc.; [PROVIDED, HOWEVER, THAT THE
ABOVE RESTRICTION SHALL NOT APPLY TO ANY SHARES OF COMMON STOCK ISSUED AND
OUTSTANDING AS OF THE DATE HEREOF, BUT SHALL APPLY TO ANY AND ALL SHARES OF
COMMON STOCK THAT ARE ISSUED AND OUTSTANDING AS OF THE DATE HEREOF, BUT SHALL
APPLY TO ANY AND ALL SHARES OF COMMON STOCK THAT ARE ISSUED PURSUANT TO THE
EXERCISE OF ANY STOCK OPTIONS PURSUANT TO AGREEMENTS BY AND BETWEEN THE
UNDERSIGNED AND THE COMPANY].
Very truly yours,
-----------------------------------
Name:
------------------------------
