2,000,000 Shares
MEDIALINK WORLDWIDE INCORPORATED
Common Stock
UNDERWRITING AGREEMENT
December __, 1996
XXXX XXXXXX XXXXXXXX INC.
WHEAT, FIRST SECURITIES, INC.
As Representative of the several Underwriters
c/o Xxxx Xxxxxx Xxxxxxxx Inc.
2 World Trade Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
1. Introductory. Medialink Worldwide Incorporated, a Delaware corporation
(the "Company"), proposes to issue and sell, pursuant to the terms of this
Agreement, to the several Underwriters named in Schedule A hereto (the
"Underwriters" which term also shall include any underwriter substituted as
hereinafter provided in Section 11) an aggregate of 2,000,000 shares of Common
Stock, par value $.01 per share (the "Common Stock") of the Company. The
aggregate of 2,000,000 shares so proposed to be sold are hereinafter referred to
as the "Firm Stock." The selling stockholders named in Schedule B hereto (the
"Selling Stockholders") also propose to sell severally to the Underwriters, on a
pro rata basis, at the option of the Underwriters, an aggregate of not more than
300,000 shares of Common Stock as provided in Section 3 of this Agreement. The
aggregate of 300,000 shares so proposed to be sold is herein called the
"Optional Stock." The Firm Stock and the Optional Stock are collectively
referred to herein as the "Stock." Xxxx
Xxxxxx Xxxxxxxx Inc. and Wheat, First Securities, Inc. are acting as
representatives of the several Underwriters and in such capacity are hereinafter
referred to as the "Representatives."
Before the purchase and public offering of the Stock by the several
Underwriters, the Company and the Representatives, acting on behalf of the
several Underwriters, shall enter into an agreement substantially in the form of
Exhibit A hereto (the "Pricing Agreement"). The offering of the Stock will be
governed by this Agreement, as supplemented by the Pricing Agreement. From and
after the date of the execution and delivery of the Pricing Agreement, this
Agreement shall be deemed to incorporate the Pricing Agreement.
2. (a) Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with, the several Underwriters, as of the
date hereof and as of the date of the Pricing Agreement (such later date being
hereinafter referred to as the "Representation Date"), that:
(i) A registration statement on Form S-1 (File No. 333-14119) with
respect to the Stock, a copy of which has heretofore been delivered to you,
has been carefully prepared by the Company in conformity with the
requirements of the Securities Act of 1933, as amended (the "Act"), and the
published rules and regulations (the "Rules and Regulations") of the
Securities and Exchange Commission (the "Commission") under the Act, and
has been filed with the Commission under the Act; and the Company has so
prepared and proposes so to file prior to the effective date of such
registration statement an amendment to such registration statement
including the final form of prospectus (which may omit such information as
permitted by Rule 430A of the Rules and Regulations). Such registration
statement as amended and the prospectus constituting a part thereof
(including in each case the information, if any, deemed to be a part
thereof pursuant to Rule 430A(b) or Rule 434 of the Rules and Regulations)
are hereinafter referred to as the "Registration Statement" and the
"Prospectus", respectively, except that if any revised prospectus shall be
provided to the Underwriters by the Company for use in connection with the
offering of the Stock which differs from the prospectus on file at the
Commission at the time the Registration Statement becomes effective
(whether or not such prospectus is required to be filed by the Company
pursuant to Rule 424(b) of the Rules and Regulations), the term
"Prospectus" shall refer to such revised prospectus from and after the time
it is first provided to the Underwriters for such use. If the Company
elects to rely on Rule 434 under the Rules
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and Regulations, all references to the Prospectus shall be deemed to
include, without limitation, the form of prospectus and the term sheet,
taken together, provided to the Underwriters by the Company in reliance on
Rule 434 under Rules and Regulations (the "Rule 434 Prospectus"). If the
Company files a registration statement to register additional shares of
Common Stock and relies on Rule 462(b) for such registration statement to
become effective upon filing with the Commission (the "Rule 462
Registration Statement"), then any reference to "Registration Statement"
herein shall be deemed to be to both the registration statement referred to
above (No. 333-14119) and the Rule 462 Registration Statement, as each such
registration statement may be amended pursuant to the Act.
(ii) When the Registration Statement becomes effective and as of the
Representation Date, the Registration Statement and the Prospectus will
conform in all material respects to the requirements of the Act and the
Rules and Regulations. At the time the Registration Statement becomes
effective and at the Representation Date, the Registration Statement will
not include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading. The Prospectus, at the time the
Registration Statement becomes effective and as of the Representation Date
(unless the term "Prospectus" refers to a prospectus which has been
provided to the Underwriters by the Company for use in connection with the
offering of the Stock which differs from the prospectus on file at the
Commission at the time the Registration Statement becomes effective, in
which case at the time it is first provided to the Underwriters for such
use) and at the Closing Date (as hereinafter defined), will not include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that the foregoing representations, warranties and agreements
shall not apply to information contained in or omitted from the
Registration Statement or the Prospectus in reliance upon, and in
conformity with, written information furnished to the Company by or on
behalf of any Underwriter, directly or through the Representatives,
specifically for use in the preparation thereof.
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(iii) Subsequent to the respective dates as of which information is
given in the Registration Statement and Prospectus, (A) neither the Company
nor its sole subsidiary, Medialink PR Data Corporation ("Medialink PR"),
has incurred any liabilities or obligations (indirect, direct or
contingent) or entered into any oral or written agreements or other
transactions not in the ordinary course of business that, singly or in the
aggregate, could reasonably be expected to be material to the Company and
Medialink PR considered as a whole or that could reasonably be expected to
result in a material reduction in the earnings of the Company and Medialink
PR considered as a whole, (B) neither the Company nor Medialink PR has
sustained any loss or interference with its business or properties from
strike, fire, flood, windstorm, accident or other calamity (whether or not
covered by insurance) that, singly or in the aggregate, could reasonably be
expected to be material to the Company and Medialink PR considered as a
whole, (C) there has been no material change in the indebtedness of the
Company, no change in the capital stock of the Company and no dividend or
distribution of any kind declared, paid or made by the Company on any class
of its capital stock, and (D) there has not been any material adverse
change, nor any development that could, singly or in the aggregate, result
in a material adverse change in the condition (financial or other),
business, prospects or results of operations of the Company and Medialink
PR considered as a whole, whether or not arising in the ordinary course of
business.
(iv) The financial statements, together with the related notes and
schedules, set forth in the Prospectus and elsewhere in the Registration
Statement, fairly present, on the basis stated in the Registration
Statement, the financial position and the results of operations and changes
in financial position of the Company and Medialink PR at the respective
dates or for the respective periods therein specified. Such financial
statements and related notes and schedules have been prepared in accordance
with generally accepted accounting principles applied on a consistent basis
except as may be set forth in the Prospectus. The selected financial data
set forth in the Prospectus under the caption "Selected Financial
Information" fairly presents, on the
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basis stated in the Registration Statement, the information set forth
therein.
(v) The Unaudited Pro Forma Condensed Combined Financial Statements of
the Company and the related notes thereto included in the Registration
Statement and the Prospectus have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial
statements and have been properly compiled on the bases described therein,
and the assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the transactions
and circumstances referred to therein.
(vi) KPMG Peat Marwick LLP, who have expressed their opinions on the
audited financial statements and related schedules included in the
Registration Statement, are independent public accountants as required by
the Act and the Rules and Regulations.
(vii) Each of the Company and Medialink PR has been duly organized and
is validly existing and in good standing as a corporation under the laws of
the State of Delaware, with power and authority (corporate and other) to
own, lease and operate its properties and to conduct its businesses as
described in the Registration Statement and Prospectus; the Company and
Medialink PR each is in possession of and operating in compliance with all
franchises, grants, authorizations, licenses, permits, easements, consents,
certificates and orders required for the conduct of its business, all of
which are valid and in full force and effect, and neither the Company nor
Medialink PR has received any notice of proceedings relating to the
revocation or modification of any such franchise, grant, authorization,
license, permit, easement, consent, certificate or order which, singly or
in the aggregate, if the subject of an unfavorable decision, would result
in a materially adverse change in the condition (financial or otherwise),
business, prospects or results of operations of the Company and Medialink
PR considered as a whole; and the Company and Medialink PR each is duly
qualified to do business and in good standing as foreign corporations in
all other jurisdictions where their ownership or leasing of
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properties or the conduct of their businesses requires such qualification.
(viii) The Company has authorized, issued and outstanding capital
stock as set forth under the heading "Capitalization" in the Prospectus
(except for subsequent issuances, if any, pursuant to reservations or
agreements referred to in the Prospectus); the issued and outstanding
shares of Common Stock (including the outstanding shares of the Stock) of
the Company conform to the description thereof in the Prospectus and have
been duly authorized and validly issued and are fully paid and
nonassessable and are duly approved for listing on the Nasdaq National
Market; the stockholders of the Company have no preemptive rights with
respect to any shares of capital stock of the Company and all outstanding
shares of capital stock of Medialink PR have been duly authorized and
validly issued, and are fully paid and nonassessable and are owned directly
by the Company free and clear of any liens, encumbrances, equities or
claims.
(ix) The Stock to be issued and sold by the Company to the
Underwriters hereunder has been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein and in the
Pricing Agreement, will be duly and validly issued and fully paid and
nonassessable and will conform to the description thereof in the
Prospectus.
(x) Except as disclosed in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or Medialink PR is a
party or of which any property of the Company or Medialink PR is the
subject, that are required to be disclosed in the Registration Statement
(other than as described therein), or which, if determined adversely to the
Company or Medialink PR, would individually or in the aggregate result in a
material adverse change in the condition (financial or otherwise),
business, prospects or results of operations of the Company and Medialink
PR considered as a whole or which might materially and adversely affect the
consummation of this Agreement; and to the best of the Company's knowledge
no such proceedings are threatened or contemplated by governmental
authorities or threatened by others.
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(xi) Neither the Company nor Medialink PR is, or with the giving of
notice or passage of time or both would be, in breach or violation of any
of the terms or provisions of or in default under (A) any statute, rule or
regulation applicable to the Company or Medialink PR, (B) any indenture,
contract, lease, mortgage, deed of trust, note or loan agreement or other
agreement or instrument to which the Company or Medialink PR is a party or
by which it may be bound, (C) its certificate of incorporation, by-laws or
other organizational documents, and (D) any order, decree or judgment of
any court or governmental agency or body having jurisdiction over the
Company or Medialink PR. The performance of this Agreement and the
consummation of the transactions herein contemplated will not, with the
giving of notice or passage of time or both, result in a breach or
violation of any of the terms or provisions of or constitute a default
under (W) any statute, rule or regulation applicable to the Company or
Medialink PR, (X) any indenture, contract, mortgage, lease, deed of trust,
note or other agreement or instrument to which the Company or Medialink PR
is a party or by which it is bound, (Y) the Company's or Medialink PR's
certificate of incorporation, by-laws or other organizational documents, or
(Z) any order, decree judgment of any court or governmental agency or body
having jurisdiction over the Company or Medialink PR or any of their
respective properties.
(xii) No labor dispute with the employees of the Company or Medialink
PR exists or is imminent; and the Company and Medialink PR are not aware of
any existing or imminent labor disturbance by the employees of any of their
principal suppliers, manufacturers or contractors which might be expected
to result in any material adverse change in the condition (financial or
otherwise), or in the earnings, affairs, business or prospects of the
Company and Medialink PR considered as a whole.
(xiii) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is
required for the issuance and sale of the Stock by the Company or for the
consummation by the Company of the transactions contemplated by this
Agreement, including, without limitation, the use of the
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proceeds from the sale of the Stock to be sold by the Company in the manner
contemplated in the Prospectus under the caption "Use of Proceeds," except
such as may be required by the National Association of Securities Dealers,
Inc. (the "NASD") or under the Act or the Securities Exchange Act of 1934
(the "Exchange Act") or the securities or Blue Sky laws of any jurisdiction
in connection with the purchase and distribution of the Stock by the
Underwriters.
(xiv) This Agreement and the Pricing Agreement have been duly
authorized, executed and delivered by the Company.
(xv) The Company and Medialink PR own or have obtained valid licenses
for all trademarks, trademark registrations, service marks, service xxxx
registrations, trade names and copyrights described in the Prospectus as
being owned, licensed or used by the Company or Medialink PR or that are
necessary for the conduct of their respective businesses as described in
the Prospectus (collectively, "Intellectual Property") and neither the
Company nor Medialink PR is aware of any claim (or of any facts that would
form a reasonable basis for any claim) to the contrary or any challenge by
any third party to the rights of the Company or Medialink PR with respect
to any such Intellectual Property or to the validity or scope of any such
Intellectual Property and neither the Company nor Medialink PR currently
has any claim against a third party with respect to the infringement by
such third party of any such Intellectual Property, which claims or
challenges, if adversely determined, could, singly or in the aggregate,
have a material adverse effect on the condition (financial or otherwise),
business, prospects or results of operations of the Company and Medialink
PR considered as a whole. The Company has a good faith belief in the
distinctiveness and enforceability of all trademarks, service marks and
trade names comprising the Intellectual Property.
(xvi) The Company and Medialink PR have such certificates, permits,
licenses, franchises, consents, approvals, authorizations and clearances as
are necessary to own, lease or operate their respective properties and to
conduct their respective businesses in the manner described in the
Prospectus ("Licenses") and all such Licenses are
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valid and in full force and effect. The Company and Medialink PR are in
compliance in all material respects with their respective obligations under
such Licenses and no event has occurred that allows, or after notice or
lapse of time or both would allow, revocation, suspension or termination of
any such License or a material violation of any such laws or regulations.
No such License contains a burdensome restriction on the Company or
Medialink PR that is not adequately disclosed in the Registration Statement
and the Prospectus.
(xvii) The Company is not an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in the
Investment Company Act of 1940, as amended.
(xviii) The Company and Medialink PR do not own any real property. The
Company and Medialink PR have good and marketable title to all personal
property owned by the Company and Medialink PR, free and clear of any
mortgage, pledge, lien, security interest, claim or encumbrance of any kind
that may materially interfere with the use of such properties or the
conduct of the business of the Company and Medialink PR considered as a
whole; and all material properties held under lease or sublease by the
Company or Medialink PR are held under valid, subsisting and enforceable
leases or subleases.
(xix) The Company and Medialink PR maintain accurate books and records
reflecting their respective assets and maintain internal accounting
controls which provide reasonable assurance that (A) transactions are
executed with management's authorization, (B) transactions are recorded as
necessary to permit preparation of financial statements and to maintain
accountability for assets, (C) access to assets is permitted only in
accordance with management's authorization and (D) the reported
accountability of assets is compared with existing assets at reasonable
intervals.
(xx) The Company has complied, and will continue to comply, with all
provisions of Section 517.075 of the Florida Statutes (Chapter 92-198, Laws
of Florida) and the rules thereunder.
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(xxi) Each of the Company and Medialink PR carry or is entitled to the
benefits of insurance in such amounts and covering such risks as is
generally maintained by or on behalf of companies of established repute
engaged in the same of similar business, and all such insurance is in full
force and effect.
(xxii) The properties, assets and operations of each of the Company
and Medialink PR are in compliance with all applicable federal, state,
local and foreign laws, rules and regulations orders, decrees, judgments,
permits and licenses relating to public and worker health and safety and to
the protection and clean-up of the natural environment and activities or
conditions related thereto, including, without limitation, those relating
to the generation, handling, disposal, transportation or release of
hazardous materials (collectively, "Environmental Laws"), except to the
extent that failure to comply could not, singly or in the aggregate, have a
material adverse effect on the condition (financial or otherwise),
business, prospects or results of operations of the Company and Medialink
PR considered as a whole. With respect to such properties, assets and
operations, including any previously owned, leased or operated properties,
assets or operations, there are no past, present or, to the best knowledge
of the Company, reasonably anticipated future events, conditions,
circumstances, activities, practices, incidents, actions or plans of the
Company or Medialink PR that may interfere with or prevent compliance or
continued compliance in all material respects with applicable Environmental
Laws. Neither the Company nor Medialink PR is the subject of any federal,
state, local or foreign investigation, and neither the Company nor
Medialink PR has received any notice or claim (or is aware of any facts
that would form a reasonable basis for any claim), nor entered into any
negotiations or agreements, with any third party relating to any liability
or remedial action or potential liability or remedial action under
Environmental Laws, nor are there any pending, reasonably anticipated or,
to the best knowledge of the Company, threatened actions, suits or
proceedings against or affecting the Company, Medialink PR or their
properties, assets, or operations, in connection with any such
Environmental Laws. The term "hazardous materials" shall
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mean those substances that are regulated by or form the basis for liability
under any applicable Environmental Laws.
(xxiii) Each of the Company and Medialink PR has filed all federal,
state, local and foreign tax returns required to be filed, such returns are
complete and accurate in all material respects, and all taxes shown by such
returns or otherwise assessed that are due or payable have been paid,
except such taxes as are being contested in good faith and as to which
adequate reserves have been provided. The charges, accruals and reserves on
the books of the Company and Medialink PR in respect of any tax liability
for any year not finally determined are adequate to meet any assessments or
reassessments for additional taxes; and there has been no tax deficiency
asserted and, to the best knowledge of the Company, no tax deficiency might
be asserted or threatened against the Company or Medialink PR that could,
singly or in the aggregate, have a material adverse effect on the financial
(financial or otherwise), business, prospects or results of operations of
the Company and Medialink PR considered as a whole.
(xxiv) Each "employee benefit plan" within the meaning of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), in which
employees of the Company or Medialink PR are eligible to participate is in
compliance in all material respects with the applicable provisions of ERISA
and the Internal Revenue Code of 1986, as amended. Neither the Company nor
Medialink PR has any liability under Title IV of ERISA, nor does the
Company or Medialink PR expect that any such liability will be incurred,
that could singly or in the aggregate, have a material adverse effect on
the condition (financial or otherwise), business, prospects or results of
operations of the Company and Medialink PR considered as a whole.
(xxv) No transaction has occurred between or among the Company,
Medialink PR and any of their respective officers, directors or affiliates
or, to the best of the Company's knowledge, any affiliate of any such
officer or director, that is required to be described in the Registration
Statement that is not so described.
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(xxvi) Except as disclosed in the Registration Statement and
Prospectus, there are no contracts, agreements or understandings between
the Company or Medialink PR and any third party (whether acting in an
individual, fiduciary or other capacity) granting such third party the
right to require the Company to file a registration statement under the Act
with respect to any securities of the Company owned or to be owned by such
third party or to require the Company to include such securities in the
securities registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration statement
filed by the Company under the Act.
(xxvii) There are no statutes, regulations, contracts or other
documents that are required to be described in the Registration Statement
or the Prospectus or to be filed as an exhibit to the Registration
Statement that are not described or filed as required. The contracts so
described in the Registration Statement and the Prospectus are in full
force and effect and neither the Company or Medialink PR nor, to the best
knowledge of the Company, any other party, is in breach of or default under
any such contracts.
(xxviii) The Company has not taken and will not take, directly or
indirectly, any action designed to or that could reasonably be expected to
cause or result in the stabilization or manipulation of the price of the
Common Stock and the Company has not distributed and will not distribute
any offering material in connection with the offering and sale of the Stock
other than any preliminary prospectus filed with the Commission or the
Prospectus or other materials, if any, permitted by the Act or the Rules or
Regulations.
(xxix) Neither the Company nor Medialink PR has, at any time during
the last five years, (A) made any unlawful contributions to any candidate
for foreign office or failed to disclose fully any contributions in
violation of law or (B) made any payment to any federal, state or local
governmental officer or official or other person charged with similar
public or quasi-public duties, other than payments required or permitted by
the laws of the United States or any jurisdiction thereof.
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(xxx) Except as contemplated by this Agreement, there is no broker,
finder or other party that is entitled to receive from the Company or
Medialink PR any brokerage or finder's fee or any other fee, commission or
similar payment in connection with the Stock to be sold by the Company.
(b) Any certificate signed by an officer of the Company and delivered to
the Representatives or counsel for the Underwriters shall be deemed a
representation and warranty of the Company to each Underwriter as to the matters
covered thereby.
(c) Representations, Warranties and Agreements of the Selling Stockholders.
Each Selling Stockholder represents and warrants to, and agrees with, the
several Underwriters that:
(i) Such Selling Stockholder has full right, power and authority to
enter into this Agreement, the Pricing Agreement and the custody agreement
and power of attorney (the "Power of Attorney"). The custody agreement and
the Power of Attorney are collectively referred to herein as the "Custody
Agreement." Such Selling Stockholder has duly executed and delivered this
Agreement and the Pricing Agreement. The Custody Agreement has been duly
executed and delivered on behalf of each Selling Stockholder and the
Custody Agreement constitutes the valid and binding agreement of such
Selling Stockholder enforceable against such Selling Stockholder in
accordance with its terms.
(ii) Such Selling Stockholder has full right, power and authority to
sell, transfer, assign and deliver the Optional Stock being sold by such
Selling Stockholder hereunder. Immediately prior to the delivery of the
shares of Optional Stock being sold by such Selling Stockholder, such
Selling Stockholder was the sole registered owner of such shares of
Optional Stock and had good and valid title to such shares of Optional
Stock, free and clear of all adverse claims as defined in Section 8-302 of
the Uniform Commercial Code and, upon registration of such shares of
Optional Stock in the names of the Underwriters or their nominees, assuming
that such purchasers purchased such shares of Optional Stock in good faith
without notice of any adverse claims as defined
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in Section 8-302 of the Uniform Commercial Code, such purchasers will have
acquired all the rights of such Selling Stockholder in such shares of
Optional Stock free of any adverse claim, any lien in favor of the Company
or any third party or restrictions on transfer imposed by the Company.
(iii) The performance of this Agreement and the Custody Agreement and
the consummation of the transactions herein and therein contemplated will
not, with the giving of notice or the passage of time or both, result in a
breach or violation of any of the terms or provisions of or constitute a
default under any statute, rule or regulation applicable to such Selling
Stockholder, or any indenture, mortgage, deed of trust, note or loan
agreement or other agreement or instrument to which such Selling
Stockholder is a party or by which it is bound, or any judgment, order or
decree of any court or governmental agency or body having jurisdiction over
such Selling Stockholder or any of its properties, or, if such Selling
Stockholder is a corporation, limited partnership, limited liability
company or trust, the certificate or articles of incorporation, or other
organizational documents or bylaws of such Selling Stockholder.
(iv) For a period of 180 days after the date of the Prospectus, such
Selling Stockholder will not, without the prior written consent of Xxxx
Xxxxxx Xxxxxxxx Inc., directly or indirectly, (i) offer, sell, assign,
transfer, encumber, pledge, contract to sell, grant an option to purchase
or otherwise dispose of, other than by operation of law, any shares of
Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock or any other rights to purchase Common Stock
(including, without limitation, Common Stock which may be deemed to be
beneficially owned by such Selling Stockholder in accordance with the Rules
and Regulations (such shares, the "Beneficially Owned Shares") whether now
owned or hereafter acquired by such Selling Stockholder or with respect to
which such Selling Stockholder has or hereafter acquires the power of
disposition, or file any registration statement under the Act, with respect
to any of the foregoing or (ii) enter into any swap or any other agreement
or any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of Common
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Stock or any Beneficially Owned Shares, whether any such swap or
transaction is to be settled by delivery of Common Stock or other
securities, in cash or otherwise, except for (A) the Stock being sold
hereunder or (B) the exercise of outstanding options granted by the Company
or pursuant to any options granted or to be granted pursuant to any
employee or non-employee director stock option plans (but not the sale,
distribution, pledge, hypothecation or other disposition of shares of
Common Stock received upon exercise of any such option).
(v) Such Selling Stockholder has duly executed and delivered the
Custody Agreement (A) appointing _________________ and _______________, and
each of them, as attorney-in-fact (the "Attorneys-in-fact") with authority
to execute and deliver this Agreement on behalf of such Selling
Stockholder, to authorize the delivery of the shares of Optional Stock to
be sold by such Selling Stockholder hereunder and otherwise to act on
behalf of such Selling Stockholder in connection with the transactions
contemplated by this Agreement, and (B) appointing ____________________, as
Custodian, to hold in custody for delivery under this Agreement
certificates for the shares of Optional Stock to be sold by such Selling
Stockholder hereunder.
(vi) No consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation by such
Selling Stockholder of the transactions contemplated by this Agreement,
except such as may be required by the NASD or under the Act or Exchange Act
or the securities or Blue Sky laws of any jurisdiction in connection with
the purchase and distribution of the Optional Stock by the Underwriters.
(vii) Such Selling Stockholder has not (A) taken, directly or
indirectly, any action designed to cause or result in, or that has
constituted or might reasonably be expected to constitute, the
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Optional Stock or (B) since the
filing of the Registration Statement (1) sold, bid for, purchase or paid
anyone any compensation for soliciting purchases of, the Optional Stock or
(2) paid or agreed to pay to any
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person any compensation for soliciting another to purchase any other
securities of the Company.
(viii) All information furnished or to be furnished to the Company by
or on behalf of such Selling Stockholder for use in connection with the
preparation of the Registration Statement and the Prospectus, insofar as it
relates to such Selling Stockholder, is or will be true and correct in all
respects and, with respect to the Registration Statement, does not and will
not contain an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading, and, with respect to the Prospectus,
does not and will not contain any untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
(ix) Nothing has come to such Selling Stockholder's attention that has
caused such Selling Stockholder to believe that (A) at the time the
Registration Statement becomes effective and at the Representation Date, it
will include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading and (B) the Prospectus, at the time the
Registration Statement becomes effective and as of the Representation Date
(unless the term "Prospectus" refers to a prospectus which has been
provided to the Underwriters by the Company for use in connection with the
offering of the Stock which differs from the prospectus on file at the
Commission at the time the Registration Statement becomes effective, in
which case at the time it is first provided to the Underwriters for such
use) and at the Option Closing Date, the Prospectus will include any untrue
statement of material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The foregoing representations,
warranties and agreements in this subsection (ix) shall not apply to
information contained in or omitted from the Registration Statement or the
Prospectus in reliance upon, and in conformity with, written information
furnished to the Company by or on behalf of any
16
Underwriter, directly or through the Representatives, specifically for use
in the preparation thereof.
Each Selling Stockholder agrees that the shares of Optional Stock
represented by the certificates held in custody under the Custody Agreement are
for the benefit of and coupled with and subject to the interests of the
Underwriters, the other Selling Stockholders and the Company hereunder, and that
the arrangement for such custody and the appointment of the Attorneys-in-fact
are irrevocable; that the obligations of such Selling Stockholder hereunder
shall not be terminated by operation of law, whether by the death or incapacity
of such Selling Stockholder, or any other event, that if such Selling
Stockholder should die or become incapacitated or any other event occur, before
the delivery of the Optional Stock hereunder, certificates for the Optional
Stock to be sold by such Selling Stockholder shall be delivered on behalf of
such Selling Stockholder in accordance with the terms and conditions of this
Agreement and the Custody Agreement, and action taken by the Attorneys-in-fact
or any of them under the Power of Attorney shall be as valid as if such death,
incapacity or other event had not occurred, whether or not the Custodian, the
Attorneys-in-fact or any of them shall have notice of such death, incapacity or
other event.
Each Selling Stockholder further agrees that neither such Selling
Stockholder nor any of its officers, directors or affiliates will (a) take,
directly or indirectly, prior to the termination of the underwriting syndicate
contemplated by this Agreement, any action designed to cause or to result in, or
that might reasonably be expected to constitute, the stabilization or
manipulation of the price of any securities of the Company to facilitate the
sale or resale of any of the shares of Common Stock, (b) sell, bid for, purchase
or pay anyone any compensation for soliciting purchases of, Common Stock or (c)
pay to or agree to pay any person any compensation for soliciting another to
purchase any other securities of the Company.
3. Purchase by, and Sale and Delivery to, Underwriters; Closing Date. On
the basis of the representations, warranties, covenants and agreements herein
contained, and subject to the terms and conditions herein set forth, the Company
agrees to sell to the Underwriters the Firm Stock, and subject to the terms and
conditions herein set forth, the Underwriters agree, severally and not jointly,
to purchase from the Company, at the price per share set forth in the Pricing
Agreement, the number of shares of Firm Stock set forth opposite its name in
Schedule A (except as otherwise provided in the Pricing Agreement), subject to
adjustment in accordance with Section 11 hereof.
The Underwriters agree to reserve a maximum of _____ shares of Firm Stock
for offering and sale to certain officers and employees of the Company and to
certain other persons designated by the Company directly related to the conduct
of its business, at the public offering price. Any such shares of Firm Stock not
purchased by such persons immediately following the initial public offering of
the Firm Stock will be offered to the public by the Underwriters as set forth in
the Prospectus.
If the Company has elected not to rely upon Rule 430A under the Rules and
Regulations, the initial public offering price and the purchase price per share
to be paid by the several Underwriters for the Firm Stock each
17
have been determined and set forth in the Pricing Agreement, dated the date
hereof, and an amendment to the Registration Statement and the Prospectus will
be filed before the Registration Statement becomes effective.
If the Company has elected to rely upon Rule 430A under the Rules and
Regulations, the purchase price per share to be paid by the several Underwriters
for the Firm Stock shall be an amount equal to the initial public offering
price, less an amount per share to be determined by agreement between the
Representatives and the Company. The initial public offering price per share of
the Firm Stock shall be a fixed price to be determined by agreement between the
Representatives and the Company. The initial public offering price and the
purchase price, when so determined, shall be set forth in the Pricing Agreement.
In the event that such prices have not been agreed upon and the Pricing
Agreement has not been executed and delivered by all parties thereto by the
close of business on the fourteenth business day following the date of this
Agreement, this Agreement shall terminate forthwith, without liability of any
party to any other party, unless otherwise agreed to by the Company and the
Representatives.
The Company will deliver the Firm Stock to the Representatives for the
respective accounts of the several Underwriters (in the form of definitive
certificates, issued in such names and in such denominations as the
Representatives may direct by notice in writing to the Company given at or prior
to 12:00 Noon, New York Time, on the business day preceding the Closing Date or,
if no such direction is received, in the names of the respective Underwriters in
the amount set forth opposite each Underwriter's name on Schedule A hereto),
against payment of the purchase price therefor by wire transfer in immediately
available funds (same day funds), all at the offices of Xxxxxxx Xxxx &
Xxxxxxxxx, One Citicorp Center, 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
The time and date of delivery and closing shall be at 10:00 A.M., on December
__, 1996, in accordance with Rule 15c6-1 of the Exchange Act; provided, however,
that such date and time may be accelerated or extended by agreement among the
Company, and the Representatives or postponed pursuant to the provisions of
Section 11 hereof. The time and date of such payment and delivery are herein
referred to as the "Closing Date". The Company shall make the certificates for
the Stock available to the Representatives for examination on behalf of the
Underwriters not later than 3:00 P.M., New York Time, on the business day
preceding the Closing Date.
In addition, for the purpose of covering any over-allotments in connection
with the distribution and sale of the Firm Stock as contemplated by the
Prospectus, the Selling Stockholders hereby grant the Underwriters an option to
purchase, severally and not jointly, up to 300,000 shares in the aggregate of
the Optional Stock. The purchase price per share to be paid for the Optional
Stock shall be the same price per share as for the Firm Stock. The option
granted hereby may be exercised as to all or any part of the Optional Stock at
any time not more than 30 days subsequent to the effective date of this
Agreement. No Optional Stock shall be sold and delivered unless the Firm Stock
previously has been, or simultaneously is, sold and delivered. The right to
purchase the Optional Stock or any portion thereof may be surrendered and
terminated at any time upon notice by the Representatives to the Selling
Stockholders.
18
The option granted hereby may be exercised by the Representatives on behalf
of the Underwriters by giving written notice to the Selling Stockholders setting
forth the number of shares of the Optional Stock to be purchased by them and the
date and time for delivery of and payment for the Optional Stock. Such date and
time for delivery of and payment for the Optional Stock (which may be the First
Closing Date) is herein called the "Option Closing Date" and shall not be later
than _____ days after written notice is given. All purchases of Optional Stock
from the Selling Stockholders shall be made on a pro rata basis. Optional Stock
shall be purchased for the account of each Underwriter in the same proportion as
the number of shares of Firm Stock set forth opposite such Underwriter's name in
Schedule A hereto bears to the total number of shares of Firm Stock (subject to
adjustment by the Representatives to eliminate odd lots). Upon exercise of the
option by the Representatives, the Selling Stockholders agree to sell to the
Underwriters the number of shares of Optional Stock set forth in the written
notice of exercise and the Underwriters agree, severally and not jointly,
subject to the terms and conditions herein set forth, to purchase such shares of
Optional Stock.
The Selling Stockholders will deliver the Optional Stock to the
Representatives for the respective accounts of the several Underwriters (in the
form of definitive certificates, issued in such names and in such denominations
as the Representatives may direct by notice in writing to the Selling
Stockholders given at or prior to 12:00 Noon, New York Time, on the business day
preceding the Option Closing Date or, if no such direction is received, in the
names of the respective Underwriters), against payment of the purchase price
therefor by wire transfer in immediately available funds (same day funds),
payable to the order of [_____________________], as custodian for the Selling
Stockholders, all at the offices of Xxxxxxx Xxxx & Xxxxxxxxx, One Citicorp
Center, 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000. The Selling Stockholders
shall make the certificates for the Optional Stock available to the
Representatives for examination on behalf of the Underwriters not later than
3:00 P.M., New York Time, on the business day preceding the Option Closing Date.
It is understood that Xxxx Xxxxxx Xxxxxxxx Inc. or Wheat, First Securities,
Inc., individually and not as Representatives of the several Underwriters, may
(but shall not be obligated to) make payment to the Company or to the Selling
Stockholders on behalf of any Underwriter or Underwriters, for
19
the Stock to be purchased by such Underwriter or Underwriters. Any such payment
by Xxxx Xxxxxx Xxxxxxxx Inc. or Wheat, First Securities, Inc. shall not relieve
such Underwriter or Underwriters from any of its or their other obligations
hereunder.
After the Registration Statement becomes effective, the several
Underwriters propose to make an initial public offering of the Stock at the
initial public offering price. The Representatives shall promptly advise the
Company and the Selling Stockholders of the making of the initial public
offering.
4. Covenants and Agreements of the Company. The Company covenants and
agrees with the several Underwriters that:
(a) The Company will use its best efforts to cause the Registration
Statement to become effective under the Act, will advise the Representatives
promptly as to the time at which the Registration Statement becomes effective,
will advise the Representatives promptly of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement or of
the institution of any proceedings for that purpose, and will use its best
efforts to prevent the issuance of any such stop order and to obtain as soon as
possible the lifting thereof, if issued. If the Company elects to rely on Rule
434 under the Rules and Regulations, the Company will prepare a Rule 434
Prospectus that complies with the requirements of Rule 434 under the Rules and
Regulations. If Company elects not to rely on Rule 434, the Company will provide
the Underwriters with copies of the form of Prospectus, in such number as the
Underwriters may reasonably request, and file or transmit for filing with the
Commission such Prospectus in accordance with Rule 424(b) of the Rules and
Regulations by the close of business in New York on the business day immediately
succeeding the date of the Pricing Agreement. If the Company elects to rely on
Rule 434, the Company will provide the Underwriters with the copies of the form
of Rule 434 Prospectus, in such number as the Underwriters may reasonably
request, and file or transmit for filing with the Commission the Rule 434
Prospectus in accordance with Rule 424(b) of the Rules and Regulations by the
close of business in New York on the business day immediately succeeding the
date of the Pricing Agreement.
20
(b) The Company will advise the Representatives promptly of any request by
the Commission for any amendment of or supplement to the Registration Statement
or the Prospectus or for additional information, and will not at any time file
any amendment to the Registration Statement or supplement to the Prospectus
which shall not previously have been submitted to the Representatives a
reasonable time prior to the proposed filings thereof or to which the
Representatives shall reasonably object in writing or which is not in compliance
with the Act and the Rules and Regulations.
(c) The Company will prepare and file with the Commission, promptly upon
the request of the Representatives, any amendments or supplements to the
Registration Statement or the Prospectus (including any revised prospectus which
the Company proposes for use by the Underwriters in connection with the offering
of the Stock which differs from the prospectus on file at the Commission at the
time the Registration Statement becomes effective, whether or not such revised
prospectus is required to be filed pursuant to Rule 424 of the Rules and
Regulations or any term sheet prepared in reliance on Rule 434 of the Rules and
Regulations) which in the opinion of the Representatives may be necessary to
enable the several Underwriters to continue the distribution of the Stock and
will use its best efforts to cause the same to become effective as promptly as
possible.
(d) If at any time after the effective date of the Registration Statement
when a prospectus relating to the Stock is required to be delivered under the
Act any event relating to or affecting the Company or Medialink PR occurs or has
occurred as a result of which the Prospectus would include an untrue statement
of a material fact, or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary, at any time to amend the Prospectus
to comply with the Act, the Company will promptly notify the Representatives
thereof and will prepare an amended or supplemented prospectus (in form and
substance satisfactory to counsel to the Underwriters) which will correct such
statement or omission; and, in case any Underwriter is required to deliver a
prospectus relating to the Stock nine months or more after the effective date of
the Registration Statement, the Company upon the request of the Representatives
and at the expense of such Underwriter will prepare promptly such prospectus or
prospectuses as may be necessary to
21
permit compliance with the requirements of Section 10(a)(3) of the Act.
(e) The Company will deliver to the Representatives, at or before the
Closing Date, signed copies of the Registration Statement and all amendments
thereto including all financial statements and exhibits thereto, and will
deliver to the Representatives such number of copies of the Registration
Statement, including such financial statements but without exhibits, and of all
amendments thereto, as the Representatives may reasonably request. The Company
will deliver or mail to or upon the order of the Representatives on the date of
the initial public offering, and thereafter from time to time during the period
when delivery of a prospectus relating to the Stock is required under the Act,
as many copies of the Prospectus, in final form or as thereafter amended or
supplemented as the Representatives may reasonably request; provided, however,
that the expense of the preparation and delivery of any prospectus required for
use nine months or more after the effective date of the Registration Statement
shall be borne by the Underwriters required to deliver such prospectus.
(f) The Company will make generally available to its security holders as
soon as practicable, but in any event not later than 60 days after the close of
the period covered thereby, an earnings statement (in form complying with the
provisions of Rule 158 under the Act) which will be in reasonable detail (but
which need not be audited) and which will comply with Section 11(a) of the Act,
covering a period of at least twelve months beginning not later than the first
day of the Company's fiscal quarter next following the "effective date" (as
defined in Rule 158) of the Registration Statement.
(g) The Company will cooperate with the Representatives to enable the Stock
to be qualified for sale under the securities laws of such jurisdictions as the
Representatives may designate and at the request of the Representatives will
make such applications and furnish such information as may be required of it as
the issuer of the Stock for that purpose; provided, however, that the Company
shall not be required to qualify to do business or to file a general consent to
service of process in any such jurisdiction. The Company will, from time to
time, prepare and file such statements and reports as are or may be
22
required of it as the issuer of the Stock to continue such qualifications in
effect for so long a period as the Representatives may reasonably request for
the distribution of the Stock.
(h) The Company will furnish to its stockholders annual reports containing
financial statements certified by independent public accountants and shall also
furnish quarterly summary financial information in reasonable detail which may
be unaudited. During the period of five years from the date hereof, the Company
will deliver to the Representatives and, upon request, to each of the other
Underwriters, copies of each annual report of the Company and each other report
furnished by the Company to its stockholders; and will deliver to the
Representatives, as soon as they are available, copies of any other reports
(financial or other) which the Company shall publish or otherwise make available
to any of its security holders as such, and as soon as they are available,
copies of any reports and financial statements furnished to or filed with the
Commission or any national securities exchange or the NASD.
(i) The Company will use its best efforts to effect the listing of the
Stock on the Nasdaq National Market. The Company will file with the Nasdaq
National Market all documents and notices required by the Nasdaq National Market
of companies that have issued securities that are traded in the over-the-counter
market and quotations for which are reported by Nasdaq National Market.
(j) The Company will use the net proceeds received by it from the sale of
the Stock in the manner specified in the Prospectus under "Use of Proceeds."
(k) The Company will file with the Commission such reports on Form SR as
may be required pursuant to Rule 463 under the Act.
(l) During a period of 180 days from the date of the Prospectus, the
Company will not, without prior written consent of Xxxx Xxxxxx Xxxxxxxx Inc.,
directly or indirectly, sell, offer to sell, grant any option for the sale of,
or otherwise dispose of or enter into any agreement to sell, any Common Stock or
any
23
security convertible into Common Stock (except for Common Stock issued pursuant
to reservations, agreements or employee benefit plans disclosed in the
Registration Statement).
(m) At the time this Agreement is executed, the Company shall have
furnished to the Representatives a letter from each officer and director of the
Company and certain stockholders of the Company addressed to the
Representatives, in which each such person agrees that, during a period of 180
days from the date of the Prospectus, such person will not, without the prior
written consent of Xxxx Xxxxxx Xxxxxxxx Inc., directly or indirectly, (i) offer,
sell, assign, transfer, encumber, pledge, contract to sell, grant an option to
purchase or otherwise dispose of, other than by operation of law, any shares of
Common Stock or any securities convertible into or exercisable or exchangeable
for Common Stock or any other rights to purchase Common Stock (including,
without limitation, Beneficially Owned Shares) whether now owned or hereafter
acquired by such person or with respect to which such person has or hereafter
acquires the power of disposition, or file any registration statement under the
Act, with respect to any of the foregoing or (ii) enter into any swap or any
other agreement or any transaction that transfers, in whole or in part, directly
or indirectly, the economic consequence of ownership of Common Stock or any
Beneficially Owned Shares, whether any such swap or transaction is to be settled
by delivery of Common Stock or other securities, in cash or otherwise.
5. Payment of Expenses. The Company will pay (directly or by reimbursement)
all expenses incident to the performance of the obligations of the Company and
of the Selling Stockholders under this Agreement, including but not limited to
all expenses and taxes incident to delivery of the Stock to the Representatives,
all expenses incident to the registration of the Stock under the Act and the
printing of copies of the Registration Statement, each Preliminary Prospectus,
the Prospectus, any amendments or supplements thereto including any term sheet
delivered by the Company pursuant to Rule 434 of the Rules and Regulations, the
"Blue Sky" memorandum, the Selling Stockholders' Powers of Attorney, the Custody
Agreement, the Agreement Among Underwriters, Underwriters' Questionnaire and
this Agreement and furnishing the same to the Underwriters and dealers except as
otherwise provided in Sections 4(d) and 4(e), the fees and disbursements of the
Company's counsel and
24
accountants, all filing and printing fees and expenses (including legal fees and
disbursements of counsel for the Underwriters) incurred in connection with
qualification of the Stock for sale under the laws of such jurisdictions as the
Representatives may designate, all fees and expenses (including legal fees and
disbursements of counsel for the Underwriters) paid or incurred in connection
with filings made with the National Association of Securities Dealers, Inc. (the
"NASD"), the fees and expenses incurred in connection with the listing of the
Stock on the Nasdaq National Market, the costs of preparing stock certificates,
the costs and fees of any registrar or transfer agent and all other costs and
expenses incident to the performance of their obligations hereunder which are
not otherwise specifically provided for in this Section.
If this Agreement is terminated by the Representatives in accordance with
the provisions of Section 3 or Section 8 hereof, the Company shall reimburse the
Underwriters for all of their out-of-pocket expenses, including the fees and
disbursements of Xxxxxxx Xxxx & Xxxxxxxxx, counsel for the Underwriters.
6. Indemnification and Contribution. (a) The Company agrees to indemnify
and hold harmless each Underwriter, each employee, officer, partner, director
and agent of the Underwriter, and each person, if any, who controls such
Underwriter within the meaning of the Act, against any losses, claims, damages,
liabilities or expenses (including the reasonable cost of investigating and
defending against any claims therefor and counsel fees incurred in connection
therewith), joint or several, as incurred, which may be based upon the Act, or
any other federal or state statute or at common law, arising out of any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the information
deemed to be part of the Registration Statement pursuant to Rule 430A(b) or Rule
434 of the Rules and Regulations, if applicable, or the omission or alleged
omission therefrom of a material fact required to be stated therein or necessary
to make the statements therein not misleading or arising out of any untrue
statement or alleged untrue statement of a material fact contained in the
Prospectus (or any amendment or supplement thereto) or the omission or alleged
omission therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, unless such statement or omission was made in reliance upon, and in
conformity with, written information furnished to the Company by such
Underwriter, directly or through the Representatives, specifically for use in
the preparation thereof; provided that the Company shall not be
25
liable with respect to any claims made against any Underwriter or any such
employee, officer, partner, director or agent or any such controlling person
under this subsection unless such Underwriter or employee, officer, partner,
director or agent or controlling person shall have notified the Company in
writing within a reasonable time after the summons or other first legal process
giving information of the nature of the claim shall have been served upon such
Underwriter or employee, officer, partner, director or agent or controlling
person (such notification by an Underwriter shall suffice as notification on
behalf of its officers, partners, directors, employees, agents and controlling
persons), but failure to notify the Company of any such claim shall not relieve
it from any liability which it may have to such Underwriter or employee,
officer, partner, director or agent or controlling person otherwise than on
account of the indemnity agreement contained in this Section 6(a).
The Company shall be entitled to participate at its own expense in the
defense, or, if it so elects, to assume the defense of any suit brought to
enforce any such liability, but, if the Company elects to assume the defense,
such defense shall be conducted by counsel chosen by it and reasonably
satisfactory to such Underwriter or indemnified person, as the case may be. In
the event the Company elects to assume the defense of any such suit and retain
such counsel, the Underwriter or Underwriters or other indemnified person or
persons, defendant or defendants in the suit, may retain additional counsel but
shall bear the fees and expenses of such counsel unless (i) the Company shall
have specifically authorized the retaining of such counsel or (ii) the parties
to such suit include such Underwriter or Underwriters other indemnified or
person or persons, and such Underwriter or Underwriters or other indemnified
person or persons have been advised by counsel that one or more legal defenses
may be available to it or them which may not be available to the Company, in
which case the Company shall not be entitled to assume the defense of such suit
notwithstanding its obligation to bear the fees and expenses of such counsel (it
being understood, however, that in connection with such suit, the Company shall
not be liable for the expenses of more than one separate counsel (in addition to
local counsel) representing the indemnified parties in any one action or
separate but substantially similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances). The Company will
not, without the prior written consent of each Underwriter, settle or compromise
or consent to the entry of any judgment in any pending or threatened claim,
action, suit or proceeding in respect of which indemnification may be sought
hereunder (whether or not such Underwriter or other indemnified party is a party
to such claim, action, suit or proceeding), unless such settlement, compromise
or consent (i) includes an unconditional release of such Underwriter and each
such other indemnified person or persons from all liability arising out of such
claim, action, suit or proceeding and (ii) does not include a statement as to or
as admission of fault, culpability or a failure to act by or on behalf of any
indemnified party. The Company agrees that a breach of the preceding sentence
shall cause irreparable harm to the Underwriters and that the Underwriters shall
be entitled to injunctive relief from any appropriate court ordering specific
performance of said provision. This indemnity agreement will be in addition to
any liability which the Company might otherwise have.
(b) Each Selling Stockholder, severally and not jointly, agrees to
indemnify and hold harmless each Underwriter, each employee, officer, partner,
director and agent of the Underwriter and each person, if any, who controls such
Underwriter with the meaning of the Act, against any losses, claims, damages,
liabilities or expenses (including the reasonable cost of investigating and
defending against any claims therefor and counsel fees
26
incurred in connection therewith), joint or several, as incurred, which may be
based upon the Act, or any other statute or at common law, arising out of any
untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the information
deemed to be part of the Registration Statement pursuant to Rule 430A(b) of the
Rules and Regulations, if applicable, or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to make
the statements therein not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact contained in the Prospectus (or any
amendment or supplement thereto) or the omission or alleged omission therefrom
of a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, unless
such statement or omission was made in reliance upon, and in conformity with,
written information furnished to the Company by such Underwriter, directly or
through the Representatives, specifically for use in the preparation thereof;
provided, however, that such Selling Stockholder shall not be liable with
respect to any claims made against any Underwriter or any such employee,
officer, partner, director or agent or any such controlling person under this
subsection unless such Underwriter or employee, officer, partner, director or
agent or controlling person shall have notified such Selling Stockholder in
writing within a reasonable time after the summons or other first legal process
giving information of the nature of the claim shall have been served upon such
Underwriter or employee or agent or controlling person (such notification by an
Underwriter shall suffice as notification on behalf of its officers, partners,
directors, employees, agents or controlling persons), but failure to notify such
Selling Stockholder of such claim shall not relieve such Selling Stockholder
from any liability which such Selling Stockholder may have to such Underwriter
or employee or agent or controlling person otherwise than on account of its
indemnity agreement contained in this Section 6(b); and provided, further, that
each Selling Stockholder shall only be liable under this paragraph for that
proportion of any such losses, claims, damages, liabilities or expenses which
the number of shares of the Stock set forth opposite his name in Schedule B
hereto bears to the total number of shares of Stock sold hereunder.
Such Selling Stockholder shall be entitled to participate at his own
expense in the defense, or, if he so elects, to assume the defense of any suit
brought to enforce any such liability, but, if such Selling Stockholder elects
to assume the defense, such defense shall be conducted by counsel chosen by him
and reasonably satisfactory to such Underwriter or indemnified person, as the
case may be. In the event that any Selling Stockholder elects to assume the
defense of any such suit and retain such counsel, the Underwriter or
Underwriters or other indemnified person or persons, defendant or defendants in
the suit, may retain additional counsel but shall bear the fees and expenses of
such counsel unless (i) such Selling Stockholder shall have specifically
authorized the retaining of such counsel or (ii) the parties to such suit
include such Underwriter or Underwriters or other indemnified person or persons
and such Selling Stockholder and such Underwriter or Underwriters or other
indemnified person or persons have been advised by counsel that one or more
legal defenses may be available to it or them which may not be available to such
Selling Stockholder, in which case such Selling Stockholder shall not be
entitled to assume the defense of such suit notwithstanding its obligation to
bear the fees an expenses of such counsel (it being understood, however, that in
connection with such suit, the Company and the Selling Stockholders, as
appropriate, shall not be liable for the expenses of more than one separate
counsel (in addition to local counsel) representing, the indemnified parties in
any one action or separate but substantially similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances).
This indemnity agreement will be in addition to any liability which such Selling
Stockholder might otherwise have.
(c) Each Underwriter severally agrees to indemnify and hold harmless the
Company, each of its directors, each of its officers who have signed the
Registration Statement, each of its employees, officers, directors and agents
and each person, if any, who controls the Company within the meaning of the Act
and each Selling Stockholder and each person, if any, who controls a
27
Selling Stockholder within the meaning of the Act, against any losses, claims,
damages, liabilities or expenses (including the reasonable cost of investigating
and defending against any claims therefor and counsel fees incurred in
connection therewith), joint or several, as incurred, which may be based upon
the Act, or any other statute or at common law, arising out of any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the information
deemed to be part of the Registration Statement pursuant to Rule 430A(b) of the
Rules and Regulations, if applicable, or the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to make
the statements therein not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact contained in the Prospectus (or any
amendment or supplement thereto) or the omission or alleged omission therefrom
of a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, but only
insofar as any such statement or omission was made in reliance upon, and in
conformity with, written information furnished to the Company by such
Underwriter, directly or through the Representatives, specifically for use in
the preparation thereof; provided, however, that in no case is such Underwriter
to be liable with respect to any claims made against the Company or any person
against whom the action is brought unless the Company or such person shall have
notified such Underwriter in writing within a reasonable time after the summons
or other first legal process giving information of the nature of the claim shall
have been served upon the Company or such person, but failure to notify such
Underwriter of such claim shall not relieve it from any liability which it may
have to the Company or such person otherwise than on account of its indemnity
agreement contained in this Section 6(c).
Such Underwriter shall be entitled to participate at its own expense in the
defense, or, if it so elects, to assume the defense of any suit brought to
enforce any such liability, but, if such Underwriter elects to assume the
defense, such defense shall be conducted by counsel chosen by it and reasonably
satisfactory to the Company or such person, as the case may be. In the event
that any Underwriter elects to assume the defense of any such suit and retain
such counsel, the Company, said employees, agents, officers and directors and
any other Underwriter or Underwriters or employee or employees or agent or
agents or controlling person or persons, defendant or defendants in the suit,
shall bear the fees and expenses of any additional counsel retained by them,
respectively. The Underwriter against whom indemnity may be sought shall not be
liable to indemnify any person for any settlement of any such claim effected
without such Underwriter's consent. This indemnity agreement will be in addition
to any liability which such Underwriter might otherwise have.
28
(d) If the indemnification provided for in this Section 6 is unavailable or
insufficient to hold harmless an indemnified party under subsection (a), (b) or
(c) above in respect of any losses, claims, damages, liabilities or expenses (or
actions in respect thereof) referred to herein, then each indemnifying party
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages, liabilities or expenses (or actions in
respect thereof), as incurred, in such proportion as is appropriate to reflect
the relative benefits received by the Company and the Selling Stockholders on
the one hand and the Underwriters on the other from the offering of the Stock.
If, however, the allocation provided by the immediately preceding sentence is
not permitted by applicable law, then each indemnifying party shall contribute
to such amount paid or payable by such indemnified party, as incurred, in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the Company and the Selling Stockholders on the one hand
and the Underwriters on the other in connection with the statements or omissions
which resulted in such losses, claims, damages, liabilities or expenses (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company and the Selling
Stockholders on the one hand and the Underwriters on the other shall be deemed
to be in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Company and the Selling Stockholders bear to
the total underwriting discounts and commissions received by the Underwriters,
in each case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company, the Selling Stockholders or the Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company, the Selling Stockholders and the
Underwriters agree that it would not be just and equitable if contribution were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above. The amount paid
or payable by an indemnified party as a result of the losses, claims, damages,
liabilities or expenses (or actions in respect thereof) referred to above shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with
29
investigating or defending any such claim. Notwithstanding the provisions of
this subsection (d), no Underwriter shall be required to contribute any amount
in excess of the amount by which the total price at which the shares of the
Stock underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute are several in
proportion to their respective underwriting obligations and not joint.
7. Survival of Indemnities, Representations, Warranties, etc. The
respective indemnities, covenants, agreements, representations, warranties and
other statements of the Company, the Selling Stockholders and the several
Underwriters, as set forth in this Agreement or made by them respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation made by or on behalf of any Underwriter, the Selling
Stockholders, the Company or any of its officers or directors or any controlling
person, and shall survive delivery of and payment for the Stock.
8. Conditions of Underwriters' Obligations. The respective obligations of
the several Underwriters hereunder shall be subject to the accuracy, at and
(except as otherwise stated herein) as of the date hereof, the Representation
Date and the Closing Date or the Option Closing Date, as the case may be, of the
representations and warranties made herein by the Company and the Selling
Stockholders, to the accuracy of the statements of the Company's officers or
directors in any certificate furnished pursuant to the provisions hereof, to
compliance at and as of such Closing Date by the Company and the Selling
Stockholders with their covenants and agreements herein contained and other
provisions hereof to be satisfied at or prior to such Closing Date, and to the
following additional conditions:
(a) The Registration Statement shall become effective not later than 3:00
P.M., New York City time, on the date hereof or, with the consent of the
Representatives, at a later time and
30
date, not later, however, than 5:30 P.M., New York City time on the first
business day following the date hereof, or at such later date as may be approved
by a majority in interest of the Underwriters, and at such Closing Date (i) no
stop order suspending the effectiveness thereof shall have been issued and no
proceedings for that purpose shall have been initiated or, to the knowledge of
the Company or the Selling Stockholders, threatened by the Commission, and any
request for additional information on the part of the Commission (to be included
in the Registration Statement or the Prospectus or otherwise) shall have been
complied with to the reasonable satisfaction of the Representatives, and (ii)
there shall not have come to the attention of the Representatives any facts that
would cause them to believe that the Prospectus, at the time it was required to
be delivered to a purchaser of the Stock, contained any untrue statement of a
material fact or omitted to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading. If the Company has elected to rely upon Rule 430A of the
Rules and Regulations, the price of the Stock and any price related information
previously omitted from the effective Registration Statement pursuant to Rule
430A shall have been transmitted to the Commission for filing pursuant to Rule
424(b) of the Rules and Regulations within the prescribed time period, and
before the Closing Date the Company shall have provided evidence satisfactory to
the Representatives of such timely filing, or a post-effective amendment
providing such information shall have been promptly filed and declared effective
in accordance with the requirements of Rule 430A of the Rules and Regulations.
(b) At the time of execution of this Agreement, the Representatives shall
have received from KPMG Peat Marwick LLP a letter, dated the date of such
execution, in form and substance previously approved by the Representatives, and
to the effect that:
(i) They are independent certified public accountants with respect to
the Company and Medialink PR within the meaning of the Act and the Rules
and Regulations.
(ii) In their opinion, the financial statements and supporting
schedule(s) examined by them and included in the Registration Statement
comply as to form in all material
31
respects with the applicable accounting requirements of the Act and the
related published Rules and Regulations thereunder and, if applicable, they
have made a review in accordance with standards established by the American
Institute of Certified Public Accountants of the unaudited consolidated
interim financial statements, selected financial data, pro forma financial
information, prospective financial statements and/or condensed financial
statements derived from audited financial statements of the Company for the
periods specified in such letter, as indicated in their reports thereon,
copies of which have been furnished to the Representatives;
(iii) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company
for the five most recent fiscal years included in the Prospectus agrees
with the corresponding amounts (after restatement where applicable) in the
audited consolidated financial statements for the five such fiscal years;
(iv) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and Medialink PR, inspection of the
minute books of the Company and Medialink PR since the date of the latest
audited financial statements included or incorporated by reference in the
Prospectus, inquiries of officials of the Company and Medialink PR
responsible for financial and accounting matters and such other inquiries
and procedures as may be specified in such letter, nothing came to their
attention that caused them to believe that:
(A) the unaudited condensed statements of income, consolidated
balance sheets and consolidated statements of cash flows included in
the Prospectus do not comply as to form in all material respects with
the applicable accounting requirements of the Act and the related
published rules and regulations thereunder, or are not in conformity
with generally accepted
32
accounting principles applied on a basis substantially consistent with
the basis for the audited statements of income, balance sheets and
statements of cash flows included in the Prospectus;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited financial statements from which such data and
items were derived, and any such unaudited data and items were not
determined on a basis substantially consistent with the basis for the
corresponding amounts in the audited financial statements included in
the Prospectus;
(C) the unaudited financial statements which were not included in
the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in clause (B) were not determined on a
basis substantially consistent with the basis for the audited
financial statements included in the Prospectus;
(D) any unaudited pro forma condensed financial statements
included in the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the Act and
the published rules and regulations thereunder or the pro forma
adjustments have not been properly applied to the historical amounts
in the compilation of those statements;
(E) as of a specified date not more than three days prior to the
date of such letter, there has been any change in the consolidated
capital stock of the Company (other than issuances of capital stock
upon exercise of options, upon earn-outs of performance shares] and
upon conversions of convertible securities, in each case which were
outstanding on the date of the latest balance sheet included in the
Prospectus) or any increase in the consolidated long-term debt of the
33
Company and consolidated subsidiaries, any decrease in the
consolidated net current assets, net assets or other items specified
by the Representatives, or any change in any other items specified by
the Representatives, in each case as compared with amounts shown in
the latest balance sheet included in the Prospectus, except in each
case for changes, increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in such
letter; and
(F) for the period from the date of the latest financial
statements included in the Prospectus to the specified date referred
to in Clause (E) there was any decrease in consolidated net revenues
or operating profit or the total or per share amounts of consolidated
net income or other items specified by the Representatives, or any
increases in any items specified by the Representatives, in each case
as compared with the comparable period of the preceding year and with
any other period of corresponding length specified by the
Representatives, except in each case for increases or decreases which
the Prospectus discloses have occurred or may occur or which are
described in such letter; and
(v) In addition to the examination referred to in their reports
included in the Prospectus and the limited procedures, inspection of minute
books, inquiries and other procedures referred to in paragraphs (ii) and
(iv) above, they have carried out certain specified procedures, not
constituting an examination in accordance with generally accepted auditing
standards, with respect to certain amounts, percentages and financial
information specified by the Representatives which are derived from the
general accounting records of the Company and Medialink PR, which appear in
the Prospectus or in Part II of, or in exhibits and schedules to, the
Registration Statement specified by the Representatives, and have compared
certain of such amounts, percentages and financial information with the
accounting records of the Company and Medialink PR or reports or
Company-prepared schedules and have found them to be in agreement.
34
(vi) On the basis of a reading of the unaudited condensed pro forma
financial statements included in the Registration Statement and the
Prospectus, carrying out certain specified procedures and inquiries of
certain officials of the Company and Medialink PR who have responsibility
for financial and accounting matters, and proving the arithmetic accuracy
of the application of the pro forma adjustments to the historical amounts
in the unaudited consolidated condensed pro forma financial statements,
nothing came to their attention that caused them to believe that the
unaudited consolidated condensed pro forma financial statements do not
comply as to form in all material respects with the applicable accounting
requirements of Rule 11-02 of Regulation S-X or that the pro forma
adjustments have not been properly applied to the historical amounts in the
compilation of such statements.
(c) The Representatives shall have received from KPMG Peat Marwick LLP a
letter, dated the Closing Date, to the effect that such accountants reaffirm, as
of such Closing Date, and as through made on such Closing Date, the statements
made in the letter furnished by such accountants pursuant to paragraph (b) of
this Section 8, except that the specified date will be a date not more than
three business days prior to the Closing Date.
(d) The Representatives shall have received from Tashlik, Xxxxxxxx &
Xxxxxxx P.C., counsel for the Company and the Selling Stockholders, their
opinion or opinions, dated the Closing Date, to the effect that:
(i) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of Delaware and has power and
authority (corporate and other) to own or lease its properties and conduct
its business as described in the Prospectus; the Company is in possession
of and is operating in compliance with all franchises, grants,
authorizations, licenses, permits, easements, consents, certificates and
orders required for the conduct of its business, all of which are valid and
in full force and effect; and the Company is duly qualified as a foreign
corporation in good standing in all other jurisdictions where its ownership
or leasing of properties or the conduct of its business requires such
qualification.
35
(ii) The Company has an authorized and outstanding capital stock after
giving effect to the offering as set forth under the heading
"Capitalization" in the Prospectus; all outstanding shares of Common Stock
(including the Stock) conform to the description thereof in the Prospectus
and have been duly authorized and validly issued and are fully paid and
nonassessable, and the stockholders of the Company have no preemptive
rights with respect to any shares of capital stock of the Company.
(iii) To the best of such counsel's knowledge, there are no legal or
governmental proceedings pending to which the Company or Medialink PR is a
party or of which any property of the Company or Medialink PR is the
subject, which individually or in the aggregate are material; and to the
best of such counsel's knowledge no such proceedings are threatened by
governmental authorities or others.
(iv) Neither the Company not Medialink PR is in violation of its
respective certificate of incorporation or by-laws. This Agreement and the
Pricing Agreement have been duly authorized, executed and delivered by the
Company; and the performance of this Agreement and the Pricing Agreement
and the consummation of the transactions herein and therein contemplated
will not result in a breach or violation of any of the terms or provisions
of or constitute a default under any statute, contract, indenture,
mortgage, deed of trust, loan agreement, note, lease or other agreement or
instrument known to such counsel to which the Company is a party or by
which it is bound, the Company's Amended and Restated Certificate of
Incorporation or Amended and Restated By-laws, or any order, rule or
regulation known to such counsel of any court or governmental agency or
body having jurisdiction over the Company or any of its properties.
(v) No consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation by the Company
of the transactions contemplated by this Agreement and the Pricing
Agreement, except such as may be required and has been obtained under the
Act and the Exchange Act, or as may be required under the securities or
Blue Sky laws of any jurisdiction or by the NASD in
36
connection with the purchase and distribution of the Stock by the
Underwriters.
(vi) The Registration Statement has become effective under the Act
and, to the best of the knowledge of such counsel, no stop order suspending
the effectiveness thereof has been issued and no proceedings for that
purpose have been instituted or are pending or contemplated under the Act.
(vii) The Common Stock has been approved for listing on the Nasdaq
National Market. The Registration Statement on Form 8-A relating to the
Common Stock has become effective under the Exchange Act.
(viii) The Registration Statement and the Prospectus (other than the
financial statements and supporting schedules included therein, as to which
no opinions need be rendered), and each amendment or supplement thereto, as
of their respective effective or issue dates and as of the Closing Date
complied as to form in all material respects with the requirements of the
Act and the Rules and Regulations. The Rule 434 Prospectus conforms to the
requirements of Rule 434 in all material respects.
(ix) The descriptions in the Registration Statement and Prospectus of
contracts and other documents are accurate in all material respects and
such descriptions fairly present in all material respects the information
required to be shown; and such counsel does not know of any legal or
governmental proceedings or of any contracts or documents of a character
required to be described in the Registration Statement or Prospectus or to
be filed as exhibits to the Registration Statement or Prospectus which are
not described and filed as required.
(x) The Company is not, and will not be as a result of the
consummation of the transactions contemplated by this Agreement, an
"investment company" or a company "controlled" by an "investment company"
within the meaning of the Investment Company Act of 1940, as amended.
37
(xi) Nothing has come to such counsel's attention that would lead such
counsel to believe that the Registration Statement or Prospectus, at the
time the Registration Statement became effective or at the Representation
Date, contained any untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus, at the
Representation Date (unless the term "Prospectus" refers to a prospectus
which has been provided to the Underwriters by the Company for use in
connection with the offering of the Stock which differs from the prospectus
on file at the Commission at the time the Registration Statement became
effective, in which case at the time it was first provided to the
Underwriters for such use) or at the Closing Date, included any untrue
statement of a material fact or omitted to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
(xii) Medialink PR has been duly incorporated, is validly existing as
corporation in good standing under the laws of Delaware and has power and
authority (corporate and other) to own its respective properties and
conduct its respective businesses as described in the Prospectus; Medialink
PR is in possession of and is operating in compliance with all franchises,
grants, authorizations, licenses, permits, easements, consents,
certificates and orders required for the conduct of its business, all of
which are valid and in full force and effect; and Medialink PR is duly
qualified as a foreign corporation in good standing and in all other
jurisdictions where its ownership or leasing of properties or the conduct
of its businesses requires such qualification.
(xiii) All outstanding shares of capital stock of Medialink PR have
been duly authorized and validly issued, are fully paid and nonassessable,
and are owned by the Company free and clear of any liens, encumbrances,
equities and claims.
(xiv) Each Selling Stockholder has full right, power and authority to
enter into this Agreement, the Pricing Agreement and the Custody Agreement.
Each Selling Stockholder has duly executed and delivered this Agreement and
the Pricing Agreement. The Custody Agreement has been duly executed and
delivered on behalf of each Selling Stockholder and constitutes the valid
and binding agreement of such Selling Stockholder enforceable against such
Selling Stockholder in accordance with its terms subject, as to
enforcement, to
38
applicable bankruptcy, insolvency, reorganization and moratorium laws and
other laws affecting the enforcement of creditors' rights generally and to
equitable principles.
(xv) Each Selling Stockholder has full right, power and authority to
sell, transfer, assign and deliver the Optional Stock being sold by such
Selling Stockholder hereunder. Immediately prior to the delivery of the
shares of Optional Stock being sold by such Selling Stockholder, such
Selling Stockholder was the sole registered owner of such shares of
Optional Stock and, upon registration of such shares of Optional Stock in
the names of the Underwriters or their nominees, assuming that such
purchasers purchased such shares of Optional Stock in good faith without
notice of any adverse claims as defined in Section 8-302 of the Uniform
Commercial Code, such purchasers will have acquired all the rights of such
Selling Stockholder in such shares of Optional Stock free of any adverse
claim, any lien in favor of the Company or restrictions on transfer imposed
by the Company.
(xvi) The performance of this Agreement, the Pricing Agreement and the
Custody Agreement and the consummation of the transactions herein and
therein contemplated will not, with the giving of notice of passage of time
or both, result in a breach or violation of any of the terms or provisions
of or constitute a default under any statute, rule or regulation applicable
to any Selling Stockholder, or, to the best of such counsel's knowledge,
any indenture, mortgage, deed of trust, note or loan agreement or other
agreement or instrument to which any Selling Stockholder is a party or by
which it is bound, or any judgment, order or decree known to such counsel
after due inquiry of any court or governmental agency or body having
jurisdiction over any Selling Stockholder or any of their properties or, if
any Selling Stockholder is a corporation, limited partnership, limited
liability company or trust, the certificate or articles of incorporation or
other organizational documents and bylaws of any Selling Stockholder.
(xvii) No consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation by any of the
Selling Stockholders of the transactions contemplated by this Agreement and
the Pricing Agreement, except such as may be required under the Act or
Exchange Act or as may be required under the securities or
39
Blue Sky laws of any jurisdiction in connection with the purchase and
distribution of the Stock by the Underwriters.
(xviii) Any transfer taxes which are required to be paid in connection
with the sale and delivery of the Stock to the Underwriters hereunder have
been paid and all laws imposing such taxes have been fully complied with.
(e) The Representatives shall have received from Xxxxxxx Xxxx & Xxxxxxxxx,
counsel for the Underwriters, their opinion or opinions dated the Closing Date
with respect to the validity of the Stock, the Registration Statement, the
Prospectus and such other related matters as the Representatives may require. In
giving such opinion, such counsel may rely, as to all matters governed by the
laws of jurisdictions other than the law of the State of New York and the
federal law of the United States, upon opinions of counsel satisfactory to the
Representatives. The Company and the Selling Stockholders shall have furnished
to such counsel such documents as they may request for the purpose of enabling
them to pass upon such matters.
(f) The Representatives shall have received a certificate, dated such
Closing Date, of the Chief Executive Officer or the President and the Chief
Financial or Accounting Officer of the Company to the effect that: (i) no stop
order suspending the effectiveness of the Registration Statement has been
issued, and no proceedings for that purpose have been instituted or are pending
or contemplated under the Act; (ii) subsequent to the respective dates as of
which information is given in the Prospectus, neither the Company nor Medialink
PR has incurred any liabilities or obligations, direct or contingent, nor
entered into any transactions, not in the ordinary course of business, which in
either case are material to the Company and Medialink PR considered as a whole,
whether or not arising in the ordinary course of business, and there has not
been any material adverse change in the condition (financial or otherwise),
business, prospects or results of operations of the Company and Medialink PR
considered as a whole, or any change in the capital stock or long-term debt of
the Company and Medialink PR considered as a whole; (iii) the Company has
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied at or before the Closing Date; (iv) the representations
and warranties of the Company in this Agreement are true and correct at and as
of the Closing Date; and (v) between the execution of this Agreement and the
Closing Date, the
40
business and operations conducted by the Company and Medialink PR have not
sustained a loss by strike, fire, flood, accident or other calamity (whether or
not insured) of such a character as to interfere materially with the conduct of
the business and operations of the Company and Medialink PR considered as a
whole. As used in this Section 8(f), the term "Prospectus" means the Prospectus
in the form first used to confirm sales of Stock.
(g) The Company shall have furnished to the Representatives such additional
certificates as the Representatives may have reasonably requested as to the
accuracy, at and as of the Closing Date, of the representations and warranties
made herein by it as to compliance at and as of the Closing Date by it with its
covenants and agreements herein contained and other provisions hereof to be
satisfied at or prior to the Closing Date and as to other conditions to the
obligations of the Underwriters hereunder.
(h) The Stock shall have been approved for listing on Nasdaq National
Market.
(i) In the event the Underwriters exercise the option granted in Section 3
hereof to purchase all or any portion of the Optional Shares, the
representations and warranties of the Company and the Selling Stockholders
contained herein and the statements in any certificates furnished by the Company
hereunder shall be true and correct as of the Option Closing Date, and you shall
have received:
(i) A letter from KPMG Peat Marwick LLP, in form and substance
satisfactory to you and dated the Option Closing Date, substantially the
same in scope and substance as the letter furnished to you pursuant to
Section 8(b), except that the specified date in the letter furnished
pursuant to this Section 8(i) shall be a date not more than five days prior
to the Option Closing Date.
(ii) A certificate, dated the Option Closing Date, of the Chief
Executive Officer or President and the Chief Financial or Accounting
Officer of the Company confirming that the certificate delivered at the
First Closing Date
41
pursuant to Section 8(f) remains true as of the Option Closing Date.
(iii) The opinion of Tashlik, Xxxxxxxx & Xxxxxxx, P.C., counsel for
the Company and the Selling Stockholders, in form and substance
satisfactory to counsel for the Underwriters, dated the Option Closing
Date, relating to the Optional Stock and otherwise to the same effect as
the opinion required by Section 8(d).
(iv) The opinion of Xxxxxxx Xxxx & Xxxxxxxxx, counsel for the
Underwriters, dated the Option Closing Date, relating to the Optional Stock
and otherwise to the same effect as the opinion required by Section 8(e).
If any of the conditions hereinabove provided for in this Section shall not
have been satisfied when and as required by this Agreement, this Agreement may
be terminated by the Representatives by notifying the Company of such
termination in writing or by telegram at or prior to the First Closing Date, but
the Representatives shall be entitled to waive any of such conditions.
9. Termination. This Agreement may be terminated by the Representatives by
notice to the Company if at or prior to the First Closing Date or the Option
Closing Date, as the case may be, (i) trading in securities on the New York or
American Stock Exchanges shall have been suspended or minimum or maximum prices
shall have been established on either such exchange, or a banking moratorium
shall have been declared by New York or United States authorities; (ii) there
shall have been any adverse change in the financial markets in the United
States, Japan or Europe or any outbreak or escalation of hostilities between the
United States and any foreign power, or of any other insurrection or armed
conflict involving the United States that, in the judgment of the
Representatives, makes it impracticable or inadvisable to offer, sell or deliver
the Firm Stock or the Optional Stock as applicable, on the terms contemplated by
the Prospectus or this Agreement; (iii) there shall have been since the
execution of this Agreement or since the respective dates as of which
information is given in the Prospectus any material adverse change in the
condition (financial or otherwise), or business, prospects or results of
operations of the Company and Medialink PR considered as a whole; (iv) there
shall have been any development involving the business or properties or
securities of the Company or Medialink PR or the transactions contemplated by
this Agreement, which, in the judgment of the Representatives,
42
makes it impracticable or inadvisable to offer, sell or deliver the Firm Stock
or Optional Stock, as applicable, on the terms contemplated by the Prospectus or
this Agreement or (v) if there shall be any litigation, pending or threatened,
which, in the judgment of the Representatives, makes it impracticable or
inadvisable to offer or deliver the Firm Stock or the Optional Stock, as
applicable, on the terms contemplated by the Prospectus or this Agreement. As
used in this Section 9, the term "Prospectus" means the Prospectus in the form
first used to confirm sales of Stock.
10. Reimbursement of Underwriters. Notwithstanding any other provisions
hereof, if this Agreement shall be terminated by the Representatives under
Section 8, Section 9 or Section 12, the Company will bear and pay the expenses
specified in Section 5 hereof and, in addition to their obligations pursuant to
Section 6, hereof, the Company will reimburse the reasonable out-of-pocket
expenses of the several Underwriters (including reasonable fees and
disbursements of counsel for the Underwriters) incurred in connection with this
Agreement and the proposed purchase of the Stock, and promptly upon demand the
Company will pay such amounts to you as Representatives. In addition, the
provisions of Section 6 shall survive any such termination.
11. Default By Underwriters. If any Underwriter or Underwriters shall
default in its or their obligations to purchase shares of Firm Stock hereunder
on the Closing Date and the aggregate number of shares of Firm Stock which such
defaulting Underwriter or Underwriters agreed but failed to purchase does not
exceed 10% of the total number of shares which the Underwriters are obligated to
purchase at the Closing Date, the other Underwriters shall be obligated
severally, in proportion to their respective commitments hereunder, to purchase
the shares of Firm Stock which such defaulting Underwriter or Underwriters
agreed but failed to purchase. If any Underwriter or Underwriters shall so
default and the aggregate number of shares of Firm Stock with respect to which
such default or defaults occur is more than 10% of the total number of shares
underwritten and arrangements satisfactory to the Representatives and the
Company for the purchase of such shares of Firm Stock by other persons are not
made within 48 hours after such default, this Agreement shall terminate.
43
If the remaining Underwriters or substituted underwriters are required
hereby or agree to take up all or part of the shares of Firm Stock of a
defaulting Underwriter or Underwriters as provided in this Section 11, (i) the
Company shall have the right to postpone the Closing Date for a period of not
more than five full business days, in order that the Company may effect whatever
changes may thereby be made necessary in the Registration Statement or the
Prospectus, or in any other documents or arrangements, and the Company agrees
promptly to file any amendments to the Registration Statement or supplements to
the Prospectus which may thereby be made necessary, and (ii) the respective
numbers of shares of Firm Stock to be purchased by the remaining Underwriters or
substituted underwriters shall be taken as the basis of their underwriting
obligation for all purposes of this Agreement. Nothing herein contained shall
relieve any defaulting Underwriter of its liability to the Company or the
Underwriters for damages occasioned by its default hereunder. Any termination of
this Agreement pursuant to this Section 11 shall be without liability on the
part of any non-defaulting Underwriter or the Company, except for expenses to be
paid or reimbursed pursuant to Section 5 and except for the provisions of
Section 6.
12. Default By the Company.
If the Company shall fail at the Closing Date to sell and deliver the
number of shares of Stock which it is obligated to sell hereunder, then this
Agreement shall terminate without any liability on the part of any
non-defaulting party.
No action taken pursuant to this Section shall relieve the Company so
defaulting from liability, if any, in respect of such default.
13. Notices. All communications hereunder shall be in writing and, if sent
to the Underwriters shall be mailed, delivered or telegraphed and confirmed to
you, as their Representatives c/o Xxxx Xxxxxx Xxxxxxxx Inc. at Two World Trade
Center, 65th Floor, Corporate Finance, Xxx Xxxx, Xxx Xxxx 00000, Attn: Xxxxxx X.
Xxxxxxx, III, except that notices given to an Underwriter pursuant to Section 6
hereof shall be sent to such Underwriter at the address provided to the
Representatives or, if sent to the Company, shall be mailed, delivered or
telegraphed and confirmed c/o Medialink Worldwide Incorporated, 000 Xxxxx
Xxxxxx, Xxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: Xxxxxx XxXxxxxxx.
14. Successors. This Agreement shall inure to the benefit of and be binding
upon the several Underwriters, the Company and the Selling Stockholders and
their respective successors and legal representatives. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any person
other than the persons mentioned in the preceding sentence any legal or
equitable right, remedy or claim under or in respect of this Agreement, or any
provisions herein contained, this Agreement and all conditions and provisions
hereof being
44
intended to be and being for the sole and exclusive benefit of such persons and
for the benefit of no other person; except that the representations, warranties,
covenants, agreements and indemnities of the Company and the Selling
Stockholders contained in this Agreement shall also be for the benefit of the
person or persons, if any, who control any Underwriter or Underwriters within
the meaning of Section 15 of the Act, and the indemnities of the several
Underwriters shall also be for the benefit of each director of the Company, each
of its officers who has signed the Registration Statement and the person or
persons, if any, who control the Company or any Selling Stockholder within the
meaning of Section 15 of the Act.
15. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS. The Company and the Selling Stockholders hereby consent to
personal jurisdiction in the State of New York and voluntarily submit to the
jurisdiction of the courts of such state, including the federal district courts
located in such state, in any proceeding with respect to this Agreement.
16. Counterparts. This Agreement may be executed by one or more parties
hereto in any number of counterparts each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
17. Authority of the Representatives. In connection with this Agreement,
the Representatives will act for and on behalf of the several Underwriters, and
any action taken under this Agreement by the Representatives jointly or by Xxxx
Xxxxxx Xxxxxxxx Inc., as Representatives of the several Underwriters, will be
binding on all the Underwriters ; and any action taken under this Agreement by
the Attorneys-in-fact will be binding on the related Selling Stockholders.
45
Any person executing and delivering this Agreement as Attorney-in-fact for
a Selling Stockholder represents by so doing that he has been duly appointed as
Attorney-in-fact by such Selling Stockholder pursuant to a validly existing and
binding Power of Attorney which authorizes such Attorney-in-fact to take such
action.
If the foregoing correctly sets forth our understanding, please indicate
your acceptance thereof in the space provided below for that purpose, whereupon
this letter and your acceptance shall constitute a binding agreement between us.
Very truly yours,
MEDIALINK WORLDWIDE INCORPORATED
By_______________________________
[Vice] President
SELLING STOCKHOLDERS LISTED IN
SCHEDULE B
By_______________________________
Attorney-in-fact
_________________________________
Attorney-in-fact
Acting on [its] own behalf
and on behalf of the Selling Stockholders
listed in Schedule B.
Accepted and delivered, as of the
date first above written:
XXXX XXXXXX XXXXXXXX INC.
WHEAT, FIRST SECURITIES, INC.
Acting on their own behalf and as
Representatives of the several
Underwriters referred to in the
foregoing Agreement.
BY XXXX XXXXXX XXXXXXXX INC.
By____________________________________
Authorized Signature
46
SCHEDULE A
Number of Shares of
Name Stock to be Purchased
---- ---------------------
Total...................................................
SCHEDULE B
Number of Shares of
Selling Stockholders Stock to be Purchased
-------------------- ---------------------
Total...................................................
EXHIBIT A
2,000,000 Shares
MEDIALINK WORLDWIDE INCORPORATED
Common Stock
PRICING AGREEMENT
December __, 1996
XXXX XXXXXX XXXXXXXX INC.
WHEAT, FIRST SECURITIES, INC.
As Representative of the several Underwriters
c/o Xxxx Xxxxxx Xxxxxxxx Inc.
2 World Trade Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Reference is made to the Underwriting Agreement, dated December __, 1996
(the "Underwriting Agreement"), relating to the purchase by the several
Underwriters named in Schedule A thereto, for whom Xxxx Xxxxxx Xxxxxxxx Inc. and
Wheat, First Securities, Inc. are acting as representatives (the
"Representatives"), of the above shares of Common Stock (the "Common Stock") of
Medialink Worldwide Incorporated (the "Company").
Pursuant to Section 3 of the Underwriting Agreement, the Company agrees
with each underwriter as follows:
1. The initial public offering price per share for the Stock, determined as
provided in Section 3, shall be $_______________.
2. The purchase price per share for the Stock to be paid by the several
Underwriters shall be $_______________.
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement between
the Underwriters and the Company in accordance with its terms.
Very truly yours,
MEDIALINK WORLDWIDE INCORPORATED
By: _____________________________
[Vice] President
SELLING STOCKHOLDERS LISTED ON
SCHEDULE B TO THE UNDERWRITING
AGREEMENT
By_______________________________
Attorney-in-fact
_________________________________
Attorney-in-fact
Acting on [its] own behalf
and on behalf of the Selling Stockholders
listed on Schedule B to the Underwriting
Agreement.
Accepted and delivered, as of
the date first above written:
XXXX XXXXXX XXXXXXXX INC.
Wheat, First Securities, Inc.
Acting on their own behalf and as
Representatives of the several
Underwriters referred to in the
foregoing Agreement.
BY XXXX XXXXXX XXXXXXXX INC.
By__________________________________
Authorized Signature
2