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Exhibit 1
NETWORK PLUS CORP.
DEPOSITORY SHARES
EACH REPRESENTING 1/10 OF A SHARE OF %
SERIES A CUMULATIVE CONVERTIBLE
PREFERRED STOCK
UNDERWRITING AGREEMENT
April [6], 2000
Xxxxxxx, Xxxxx & Co.
Bear, Xxxxxxx & Co. Inc.
c/o Goldman, Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Network Plus Corp., a Delaware corporation (the "Company"), proposes,
subject to the terms and conditions stated herein, to issue and sell to the
Underwriters named in Schedule I hereto (the "Underwriters") an aggregate of
2,500,000 Depositary Shares (the "Shares") representing 1/10 of a share of __%
Series A Cumulative Convertible Preferred Stock specified above (the
"Convertible Preferred Stock") of the Company and up to an aggregate of 375,000
shares (the "Optional Shares") each representing the right to receive an
aggregate of 1/10 of a share of Convertible Preferred Stock convertible into
shares of Common stock of the Company. The Firm Shares and the Optional Shares
that the Underwriters elect to purchase pursuant to Section 2 hereof are herein
collectively called the "Shares". The Shares of Convertible Preferred Stock are
to be deposited by the Company against delivery of Depositary Receipts (the
"Depositary Receipts") evidencing the Depositary Shares which are to be issued
by American Stock Transfer & Trust Company, as Depositary (the "Depositary"),
under a Deposit Agreement, to be dated as of April [ ], 2000 (the "Deposit
Agreement"), among the Company, the Depositary and the holders from time to time
of the Depositary Receipts issued thereunder. Each Depositary Share will
represent beneficial ownership of 1/10 of a share of Convertible Preferred Stock
and shares of common stock ("Stock") issuable upon conversion or redemption of,
or payable as dividends on, the Depositary Shares and the Convertible Preferred
Stock.
1. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement on Form S-3 (FILE NO. 333-32042) (the
"Initial Registration Statement") in respect of the Shares has been filed
with the Securities and Exchange Commission (the "Commission"); the
Registration Statement and any post-effective amendment thereto, each in
the form heretofore delivered to you, and, excluding exhibits thereto but
including all documents incorporated by reference in the prospectus
contained therein but including all documents incorporated by reference in
the prospectus contained therein, to you for each of the other
Underwriters, have been declared effective by the Commission in such form;
other than a registration statement, if any, increasing the size of the
offering (a "Rule 462(b) Registration Statement"), filed pursuant to Rule
462(b) under the Securities Act of 1933, as amended (the "Act"), which
became effective upon filing, no other document with respect to the Initial
Registration Statement or document incorporated by reference therein has
heretofore been filed with the Commission; and no stop order suspending the
effectiveness of the Initial Registration Statement, any post-effective
amendment thereto or the Rule 462(b) Registration Statement, if any, has
been issued and no proceeding for that purpose has been initiated or
threatened by
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the Commission (any preliminary prospectus included in the Initial
Registration Statement or filed with the Commission pursuant to Rule 424(a)
of the rules and regulations of the Commission under the Act is hereinafter
called a "Preliminary Prospectus"; the various parts of the Initial
Registration Statement and the Rule 462(b) Registration Statement, if any,
including all exhibits thereto and including (i) the information contained
in the form of final prospectus filed with the Commission pursuant to Rule
424(b) under the Act in accordance with Section 6(a) hereof and deemed by
virtue of Rule 430A under the Act to be part of the Initial Registration
Statement at the time it was declared effective and (ii) the documents
incorporated by reference in the prospectus contained in the Initial
Registration Statement at the time such part of the Initial Registration
Statement became effective, each as amended at the time such part of the
Initial Registration Statement became effective or such part of the Rule
462(b) Registration Statement, if any, became or hereafter becomes
effective, are hereinafter collectively called the "Registration
Statement"; and such final prospectus, in the form first filed pursuant to
Rule 424(b) under the Act, is hereinafter called the "Prospectus"); and any
reference herein to any Preliminary Prospectus or the Prospectus shall be
deemed to refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the Act, as of the date of
such Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment or supplement to any Preliminary Prospectus or
the Prospectus shall be deemed to refer to and include any documents filed
after the date of such Preliminary Prospectus or Prospectus, as the case
may be, under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and incorporated by reference in such Preliminary
Prospectus or Prospectus, as the case may be; and any reference to any
amendment to the Registration Statement shall be deemed to refer to and
include any annual report of the Company filed pursuant to Section 13(a) or
15(d) of the Exchange Act after the effective date of the Initial
Registration Statement that is incorporated by reference in the
Registration Statement;
(b) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material
respects to the requirements of the Act and the rules and regulations of
the Commission thereunder, and did not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter through
Xxxxxxx, Sachs & Co. expressly for use therein;
(c) The documents incorporated by reference in the Prospectus, when they
became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading; and any further documents so filed and incorporated by
reference in the Prospectus or any further amendment or supplement thereto,
when such documents become effective or are filed with the Commission, as
the case may be, will conform in all material respects to the requirements
of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading; provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon and
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in conformity with information furnished in writing to the Company by an
Underwriter through Xxxxxxx, Xxxxx & Co. expressly for use therein;
(d) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of
the Act and the rules and regulations of the Commission thereunder and do
not and will not, as of the applicable effective date as to the
Registration Statement and any amendment thereto and as of the applicable
filing date as to the Prospectus and any amendment or supplement thereto,
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the Company
by an Underwriter through Xxxxxxx, Sachs & Co. therein;
(e) Neither the Company nor Network Plus, Inc., a Massachusetts
corporation (the "Subsidiary"), which is the only direct or indirect
subsidiary of the Company (other than an Australian subsidiary of the
Subsidiary, which to date has no business operations that are material to
the Company), has sustained since the date of the latest audited financial
statements included or incorporated by reference in the Prospectus any
material loss or material interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or
from any labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Prospectus; and, since
the respective dates as of which information is given in the Registration
Statement and the Prospectus, other than option grants pursuant to option
plans as in effect prior to the date hereof, there has not been any change
in the capital stock or long-term debt of the Company or the Subsidiary or
any material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of operations of the
Company and its Subsidiary, otherwise than as set forth or contemplated in
the Prospectus;
(f) The Company and its Subsidiary do not own any real property and have
good and marketable title to all personal property owned by them, in each
case free and clear of all liens, encumbrances and defects except such as
are described in the Prospectus or such as do not materially affect the
value of such property and do not interfere with the use made and proposed
to be made of such property by the Company and its Subsidiary; and any real
property and buildings held under lease by the Company and its Subsidiary
are held by them under valid, subsisting and enforceable leases with such
exceptions as are not material and do not interfere with the use made and
proposed to be made of such property and buildings by the Company and its
Subsidiary;
(g) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of Delaware, with power and
authority (corporate and other) to own its properties and conduct its
business as described in the Prospectus, and has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such qualification, or
is subject to no material liability or disability by reason of the failure
to be so qualified in any such jurisdiction; and the Subsidiary of the
Company has been duly incorporated and is validly existing as a corporation
in good standing under the laws of Massachusetts, with power and authority
(corporate and other) to own its properties and conduct its business as
described in the Prospectus, and has been duly qualified as a foreign
corporation for the transaction of business
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and is in good standing under the laws of each other jurisdiction in which
it owns or leases properties or conducts any business so as to require such
qualification, or is subject to no material liability or disability by
reason of the failure to be so qualified in any such jurisdiction;
(h) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company
and its Subsidiary have been duly and validly authorized and issued, are
fully paid and nonassessable; the shares of Stock initially issuable upon
conversion of the Shares have been duly and validly authorized and reserved
for issuance and, when issued and delivered in accordance with the
provisions of the shares and the Indenture referred to below will be duly
and validly issued, fully paid and nonassessable and will conform to the
description of the stock contained in the Prospectus; all of the issued
capital stock of the Subsidiary is owned directly by the Company, free and
clear of all liens, encumbrances, equities or claims (except as described
in the Prospectus); there are no restrictions on subsequent transfers of
the Shares under the securities laws of the United States except as set
forth in the Prospectus, as amended or supplemented;
(i) The Shares to be issued and sold by the Company to the Underwriters
hereunder have been duly and validly authorized and, when issued and
delivered against payment therefor as provided herein, will be duly and
validly issued and fully paid and non-assessable and will conform to the
description of the Convertible Preferred Stock and the Depositary Shares
contained in the Prospectus;
(j) The issue of the Convertible Preferred Stock and the issue and sale of
the Shares and the compliance by the Company with all of the provisions of
this Agreement and the Deposit Agreement and the consummation of the
transactions herein contemplated will not:
(i) result in any violation of the provisions of the charter,
by-laws or resolutions of the directors or shareholders of the
Company or its Subsidiary;
(ii) conflict with nor will they result in a breach of or violation
of any of the terms or provisions of, or constitute a default
under (or an event which with notice or lapse of time, or both,
would constitute a default), or require consent under, or result
in the creation or imposition of any lien, charge or encumbrance
on any of the property or assets of the Company or its
Subsidiary pursuant to the terms of, any shareholders'
agreement, employment agreements, indenture, mortgage, deed of
trust, loan agreement, note, lease, permit, franchise or other
agreement or instrument to which the Company or its Subsidiary
is a party or by which the Company or its Subsidiary is bound or
to which the property or assets of the Company or its Subsidiary
is subject; or
(iii) result in any violation of any law, rule or regulation or any
judgment, order or decree of any government, governmental
instrumentality or agency, regulatory body, court or body having
jurisdiction over the Company or its Subsidiary or any of their
properties and asset; and no consent, approval, authorization,
order, registration or qualification of or with any such court
or governmental agency or body is required for the issue of the
Convertible Preferred Stock and the issue and sale of the Shares
or the consummation by the Company of the transactions
contemplated by this Agreement or the Deposit Agreement, except
the registration under the Act and the Trust Indenture Act of
the shares of Convertible Preferred Stock and the
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shares of Stock issuable upon conversion of the Securities and
such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities laws in
connection with the purchase and distribution of the Shares by
the Underwriters,
other than, in the case of clauses (ii) and (iii) above, for any breach,
default or violation which would not have a material adverse effect on the
condition (financial or other), business, prospects described in the
Prospectus ("Prospects"), affairs, management, financial position,
shareholders' equity or results of operation of the Company and its
Subsidiary, taken as a whole;
(k) Prior to the date hereof, neither the Company nor its Subsidiary has
taken any action which is designed to or which has constituted or which
might have been expected to cause or result in stabilization or
manipulation of the price of any security of the Company in connection with
the offering of the Stock.
(l) Except as set forth in or contemplated by the Registration Statement,
(i) each of the Company and its Subsidiary has all material certificates,
consents, exemptions, orders, permits, licenses, authorizations, franchises
or other material approvals (each, an "Authorization") of and from, and has
made all material declarations and filings with, all Federal, state, local
and other governmental authorities, all self-regulatory organizations, and
all courts and other tribunals, necessary or appropriate for the Company
and its Subsidiary to own, lease, license, use and construct its properties
and assets and to conduct its business in the manner described in the
Registration Statement; (ii) all such Authorizations are in full force and
effect with respect to the Company and its Subsidiary; (iii) to the best
knowledge of the Company, no event has occurred that permits, or after
notice or lapse of time could permit, the revocation, termination or
modification of any such Authorization; (iv) the Company and its Subsidiary
are in compliance in all material respects with the terms and conditions of
all such Authorizations and with the rules and regulations of the
regulatory authorities and governing bodies having jurisdiction with
respect thereto; and (v) the Company has no knowledge that any person is
contesting or intends to contest the granting of any material
Authorization, except, in the case of Clauses (i) through (v) above, for
any Authorization the absence, violation, or loss of which would not have a
material adverse effect on the condition (financial or other), business,
prospects described in the Prospectus (collectively, "Prospects"), affairs,
management, financial position, stockholders' equity or results of
operation of the Company and its Subsidiary, taken as a whole;
(m) Neither the execution or delivery of this Agreement, nor the
consummation of the transactions contemplated hereby or thereby nor
compliance with the terms, conditions and provisions hereof or thereof by
the Company will cause any suspension, revocation, impairment, forfeiture,
nonrenewal or termination of any Authorization;
(n) The statements set forth in the Prospectus under the caption
"Description of [ ]% Convertible Preferred Stock", insofar as it purports
to constitute a summary of the terms of the Preferred Stock, and under the
captions "Risk Factors -- Competition in our industry is intense and
growing and we may be unable to compete effectively" and "The
Telecommunications Act of 1996 and other regulation could adversely affect
us", "Competition", "Government Regulation", "Description of Certain
Indebtedness and Common Offering", and the sixth paragraph under
"Underwriting", insofar as they purport to describe the provisions of the
laws and documents referred to therein, are accurate and complete;
(o) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or its Subsidiary is
a party or of which
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any property of the Company or its Subsidiary is the subject which, if
determined adversely to the Company or its Subsidiary, would individually
or in the aggregate have a material adverse effect on the current or future
consolidated financial position, stockholders' equity or results of
operations of the Company and its Subsidiary; and, to the best of the
Company's knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(p) This Agreement has been duly and validly authorized, executed and
delivered by the Company and constitutes a valid and binding obligation of
the Company, enforceable against it in accordance with its terms except (i)
that the enforcement thereof may be subject to bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other similar laws now
or hereafter in effect relating to creditors' rights generally, the
discretion of the court before which any proceeding therefor may be brought
and principles equity regarding availability of remedies and (ii) as any
rights to indemnity or contribution thereunder may be limited by applicable
Securities laws;
(q) The Company is not and, after giving effect to the offering and sale
of the Shares, will not be an "investment company", as such term is defined
in the Investment Company Act of 1940, as amended (the "Investment Company
Act");
(r) Neither the Company nor any of its affiliates does business with the
government of Cuba or with any person or affiliate located in Cuba within
the meaning of Section 517.075, Florida Statutes;
(s) PricewaterhouseCoopers LLP, who have certified certain financial
statements of the Company and its Subsidiary, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder;
(t) The Company and its Subsidiary are not, as of the date hereof, and
will not be at any Time of Delivery, as defined herein by section 5(a), in
violation of their respective charters, by-laws or resolutions of their
directors or shareholders;
(u) The Company and its Subsidiary are not and will not be at any Time of
Delivery, in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, stockholders'
agreement, indenture, mortgage, deed of trust, loan agreement, note, lease,
permit, license, franchise or other agreement or instrument to which they
are a party or by which they are bound or to which any of their property or
assets is subject other than such defaults as would not have a material
adverse effect on the condition (financial or other), business, Prospects,
affairs, management, financial position, shareholders' equity or results of
operations of the Company and its Subsidiary, taken as a whole;
(v) No holder of any security of the Company has or will have any right to
require the registration of such security by virtue of any transactions
contemplated by this agreement, other than any such right that has been
expressly waived in writing; and
(w) The audited consolidated financial statements of the Company as of
December 31, 1999 and for the year then ended (including the notes thereto)
included in the Prospectus present fairly in all material respects the
consolidated financial position of the Company as of that date and have
been prepared in accordance with generally accepted accounting principles
("GAAP"); the unaudited interim financial statements of the Company
(including the notes thereto) included in the Prospectus present fairly in
all material respects the financial position of the Company as at the dates
indicated and the results of operations and the changes in its financial
position for the periods specified, subject to year-end adjustments and
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have been prepared in accordance with GAAP, except for the absence of
footnotes and year-end adjustments.
2. Subject to the terms and conditions herein set forth, (a) the Company
agrees to sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company at a purchase price per
share of $.............., the number of Firm Shares (to be adjusted by you so as
to eliminate fractional shares) determined by multiplying the aggregate number
of Shares to be sold by the Company as set forth opposite their respective names
in Schedule II hereto by a fraction, the numerator of which is the aggregate
number of Firm Shares to be purchased by such Underwriter as set forth opposite
the name of such Underwriter in Schedule I hereto and the denominator of which
is the aggregate number of Firm Shares to be purchased by all of the
Underwriters from the Company hereunder and (b) in the event and to the extent
that the Underwriters shall exercise the election to purchase Optional Shares as
provided below, the Company agrees, to sell to each of the Underwriters, and
each of the Underwriters agrees, severally and not jointly, to purchase from the
Company, at the purchase price per share set forth in clause (a) of this Section
2, that portion of the number of Optional Shares as to which such election shall
have been exercised (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying such number of Optional Shares by a fraction the
numerator of which is the maximum number of Optional Shares which such
Underwriter is entitled to purchase as set forth opposite the name of such
Underwriter in Schedule I hereto and the denominator of which is the maximum
number of Optional Shares that all of the Underwriters are entitled to purchase
hereunder.
The Company grants to the Underwriters the right to purchase at their
election up to 375,000 Optional Shares, at the purchase price per share set
forth in the paragraph above, for the sole purpose of covering sales of shares
in excess of the number of Firm Shares. Any such election to purchase Optional
Shares shall be made in proportion to the maximum number of Optional Shares to
be sold by the Company hereto initially with respect to the Optional Shares to
be sold by the Company hereto. Any such election to purchase Optional Shares may
be exercised only by written notice from you to the Company, given within a
period of 30 calendar days after the date of this Agreement and setting forth
the aggregate number of Optional Shares to be purchased and the date on which
such Optional Shares are to be delivered, as determined by you but in no event
earlier than the First Time of Delivery (as defined in Section 4 hereof) or,
unless you and the Company otherwise agree in writing, earlier than two or later
than ten business days after the date of such notice.
3. Upon the authorization by you of the release of the Firm Shares, the
several Underwriters propose to offer the Firm Shares for sale upon the terms
and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as Xxxxxxx, Xxxxx & Co. may request upon at least forty-eight hours prior
notice to the Company, shall be delivered by or on behalf of the Company to
Xxxxxxx, Sachs & Co., for the account of such Underwriter, against payment by or
on behalf of such Underwriter of the purchase price therefor by wire transfer of
Federal (same-day) funds to one or more accounts specified by the Company to
Xxxxxxx, Xxxxx & Co. at least forty-eight hours in advance. The Company will
cause the certificates representing the Shares to be made available for checking
and packaging at least twenty-four hours prior to the Time of Delivery (as
defined below) with respect thereto at the office of Xxxxxxx, Sachs & Co., 00
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Designated Office"). The Shares to
be purchased by each Underwriter hereunder will be represented by one or more
definitive global Shares in book-entry form which will be deposited by or on
behalf of the Company with The Depository Trust Company ("DTC") or its
designated custodian. The Company will deliver the Shares to Xxxxxxx, Xxxxx &
Co., for the account of each Underwriter, against payment
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by or on behalf of such Underwriter of the purchase price therefor by wire
transfer of Federal (same-day) funds to the account specified by the Company to
Xxxxxxx, Sachs & Co. for checking at least forty-eight hours in advance by
causing DTC to credit the Shares to the account of Xxxxxxx, Xxxxx & Co. at DTC.
The Company will cause the certificates representing the Shares to be made
available to Xxxxxxx, Sachs & Co. for checking at least twenty-four hours prior
to the Time of Delivery (as defined below) at the office of DTC or its
designated custodian (the "Designated Office"). The time and date of such
delivery and payment shall be 9:30 a.m., New York City time
on...................., 2000 or such other time and date as Xxxxxxx, Xxxxx & Co.
and the Company may agree upon in writing. Such time and date are herein called
the "Time of Delivery". The time and date of such delivery and payment shall be,
with respect to the Firm Shares, 9:30 a.m., New York City time, on [ ], 2000 or
such other time and date as Xxxxxxx, Sachs & Co. and the Company may agree upon
in writing, and, with respect to the Optional Shares, 9:30 a.m., New York City
time, on the date specified by Xxxxxxx, Xxxxx & Co. in the written notice given
by Xxxxxxx, Sachs & Co. of the Underwriters' election to purchase such Optional
Shares, or such other time and date as Xxxxxxx, Xxxxx & Co. and the Company may
agree upon in writing. Such time and date for delivery of the Firm Shares is
herein called the "First Time of Delivery", such time and date for delivery of
the Optional Shares, if not the First Time of Delivery, is herein called the
"Second Time of Delivery", and each such time and date for delivery is herein
called a "Time of Delivery".
Such Shares, if any, as Xxxxxxx, Sachs & Co. may request upon at least
forty-eight hours prior notice to the Company (such request to include the
authorized denominations and the names in which such Shares are to be
registered), shall be delivered in definitive certificated form, by or on behalf
of the Company to Xxxxxxx, Xxxxx & Co. for the account of certain of the
Underwriters, against payment by or on behalf of such Underwriter of the
purchase price therefor by wire transfer of Federal (same-day) funds to the
account specified by the Company to Xxxxxxx, Sachs & Co. at least forty-eight
hours in advance. The Company will cause the certificates representing such
Shares to be made available for checking and packaging at least twenty-four
hours prior to each Time of Delivery at the office of Xxxxxxx, Xxxxx & Co., 00
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
(b) The documents to be delivered at each Time of Delivery by or on behalf
of the parties hereto pursuant to Section 8 hereof, including the cross receipt
for the Shares and any additional documents requested by the Underwriters
pursuant to Section 8(k) hereof will be delivered at the offices of Cravath,
Swaine & Xxxxx, 000 Xxxxxx Xxxxxx, Xxx Xxxx, XX, 00000 (the "Closing Location"),
and the Shares will be delivered at the Designated Office, all at such Time of
Delivery. A meeting will be held at the Closing Location at [ ] p.m., New York
City time, on the New York Business Day next preceding such Time of Delivery, at
which meeting the final drafts of the documents to be delivered pursuant to the
preceding sentence will be available for review by the parties hereto. For the
purposes of this Section 4, "New York Business Day" shall mean each Monday,
Tuesday, Wednesday, Thursday and Friday which is not a day on which banking
institutions in New York are generally authorized or obligated by law or
executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file such
Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement, or, if applicable, such earlier
time as may be required by Rule 430A(a)(3) under the Act; to make no
further amendment or any supplement to the Registration Statement or
Prospectus prior to the last Time of Delivery which shall be disapproved by
you promptly after reasonable notice thereof; to advise you, promptly after
it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed and
to furnish you with copies
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thereof to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange
Act subsequent to the date of the prospectus and for so long as the
delivery of a prospectus is required in connection with the offering or
sale of the Shares; to advise you, promptly after it receives notice
thereof, of the issuance by the Commission of any stop order or of any
order preventing or suspending the use of any Preliminary Prospectus or
prospectus, of the suspension of the qualification of the Shares for
offering or sale in any jurisdiction, of the initiation or threatening of
any proceeding for any such purpose, or of any request by the Commission
for the amending or supplementing of the Registration Statement or
Prospectus or for additional information; and, in the event of the issuance
of any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or prospectus or suspending any such qualification,
promptly to use its best efforts to obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as you may reasonably
request to qualify the Shares for offering and sale under the securities
laws of such jurisdictions as you may request and to comply with such laws
so as to permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the distribution
of the Shares; provided that in connection therewith the Company shall not
be required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
(c) Prior to 10:00 A.M., New York City time, on the New York Business Day
next succeeding the date of this Agreement and from time to time, to
furnish the Underwriters with copies of the Prospectus in New York City in
such quantities as you may reasonably request, and, if the delivery of a
prospectus is required at any time prior to the expiration of nine months
after the time of issue of the Prospectus in connection with the offering
or sale of the Shares and if at such time any events shall have occurred as
a result of which the Prospectus as then amended or supplemented would
include an 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 when such Prospectus
is delivered, not misleading, or, if for any other reason it shall be
necessary during such period to amend or supplement the Prospectus or to
file under the Exchange Act any document incorporated by reference in the
Prospectus in order to comply with the Act, to notify you and upon your
request to file such document and to prepare and furnish without charge to
each Underwriter and to any dealer in securities as many copies as you may
from time to time reasonably request of an amended Prospectus or a
supplement to the Prospectus which will correct such statement or omission
or effect such compliance, and in case any Underwriter is required to
deliver a prospectus in connection with sales of any of the Shares at any
time nine months or more after the time of issue of the Prospectus, upon
your request but at the expense of such Underwriter, to prepare and deliver
to such Underwriter as many copies as you may request of an amended or
supplemented Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its stockholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c)
under the Act), an earnings statement of the Company and its Subsidiary
(which need not be audited) complying with Section 11(a) of the Act and the
rules and regulations of the Commission thereunder (including, at the
option of the Company, Rule 158);
(e) Except for any simultaneous offering led by Xxxxxxx, Sachs & Co., in
particular the offering of common stock by the Company led by Xxxxxxx Xxxxx
& Co., dated as of April , 2000, during the period beginning from the date
hereof and
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continuing to and including the date 90 days after the date of the
Prospectus, not to offer, sell, contract to sell or otherwise dispose of,
except as provided hereunder, any securities of the Company that are
substantially similar to the Shares, including but not limited to any
securities that are convertible into or exchangeable for, or that represent
the right to receive, Stock or any such substantially similar securities
(other than (a) pursuant to employee or director stock option plans
existing on, or upon the conversion or exchange of convertible or
exchangeable Shares outstanding as of, the date of this Agreement and (b)
in connection with mergers, acquisitions or other business combinations,
provided, in the case of section (b), that the acquiror or buyer of such
Shares agrees not to issue, sell, offer or agree to sell such Shares during
such 90-day period), without your prior written consent;
(f) Not to be or become, at any time prior to the expiration of three
years after the Time of Delivery, an open-end investment company, unit
investment trust, closed-end investment company or face-amount certificate
company that is or is required to be registered under Section 8 of the
Investment Company Act;
(g) To furnish to its holders of the Shares as soon as practicable after
the end of each fiscal year an annual report (including a balance sheet and
statements of income, stockholders' equity and cash flows of the Company
and its subsidiaries certified by independent public accountants) and, as
soon as practicable after the end of each of the first three quarters of
each fiscal year (beginning with the fiscal quarter ending after the
effective date of the Registration Statement), to make available to its
stockholders consolidated summary financial information of the Company and
its Subsidiary for such quarter in reasonable detail;
(h) During a period of five years from the effective date of the
Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished to stockholders, and to
deliver to you (i) 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 on which any class of securities of the
Company is listed; and (ii) such additional information concerning the
business and financial condition of the Company as you may from time to
time reasonably request (such financial statements to be on a consolidated
basis to the extent the accounts of the Company and its subsidiaries are
consolidated in reports furnished to its stockholders generally or to the
Commission);
(i) To use the net proceeds received by it from the sale of the Shares
pursuant to this Agreement in the manner specified in the Prospectus under
the caption "Use of Proceeds";
(j) To use its best efforts to list for quotation the Shares on the
National Association of Securities Dealers Automated Quotations National
Market System ("NASDAQ");
(k) To file with the Commission such information on Form 10-Q or Form 10-K
as may be required by Rule 463 under the Act; and
(l) If the Company elects to rely upon Rule 462(b), the Company shall file
a Rule 462(b) Registration Statement with the Commission in compliance with
Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the date of this
Agreement, and the Company shall at the time of filing either pay to the
Commission the filing fee for the Rule 462(b) Registration Statement or
give irrevocable instructions for the payment of such fee pursuant to Rule
111(b) under the Act.
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(m) To reserve and keep available at all times, free of preemptive rights,
shares of Stock for the purpose of enabling the Company to satisfy any
obligations to issue shares of its Stock upon conversion of the Shares.
6. The Company covenants and agrees with the several Underwriters that
(a) the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and the dealers; (ii) the cost of printing or
producing any Agreement among Underwriters, this Agreement, the Deposit
Agreement, the Indenture, the Securities, closing documents (including any
compilations thereof) and any other documents in connection with the offering,
purchase, sale and delivery of the Shares; (iii) all expenses in connection with
the qualification of the Shares for offering and sale under state securities
laws as provided in Section 5(b) hereof, including the fees and disbursements of
counsel for the Underwriters in connection with such qualification and (iv) all
fees and expenses in connection with listing the Shares on NASDAQ and the filing
fees incident to, and the fees and disbursements of counsel for the Underwriters
in connection with, securing any required review by the National Association of
Securities Dealers, Inc. of the terms of the sale of the Shares; (v) the cost of
preparing stock certificates; (vi) the cost and charges of any transfer agent or
registrar; (vii) the cost and charges of the Depositary; (viii) all other costs
and expenses incident to the performance of its obligations hereunder which are
not otherwise specifically provided for in this Section. It is understood,
however, that the Company shall bear the cost of any other matters not directly
relating to the sale and purchase of the Shares pursuant to this Agreement, and
that, except as provided in this Section, and Section 9 hereof, the Underwriters
will pay all of their own costs and expenses, including the fees of their
counsel, stock transfer taxes on resale of any of the Shares by them, and any
advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters hereunder as to the Shares to be
delivered at each Time of Delivery shall be subject, in their discretion, to the
condition that all representations and warranties and other statements of the
Company herein are, at and as of such Time of Delivery, true and correct, the
condition that the Company shall have performed all of its obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant to
Rule 424(b) within the applicable time period prescribed for such filing by
the rules and regulations under the Act and in accordance with Section 6(a)
hereof; if the Company has elected to rely upon Rule 462(b), the Rule
462(b) Registration Statement shall have become effective by 10:00 P.M.,
Washington, D.C. time, on the date of this Agreement; no stop order
suspending the effectiveness of the Registration Statement or any part
thereof shall have been issued and no proceeding for that purpose shall
have been initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to your reasonable satisfaction;
(b) Cravath, Swaine & Xxxxx, counsel for the Underwriters, shall have
furnished to you such written opinion or opinions dated such Time of
Delivery as to such related matters as you may reasonably request, and such
counsel shall have received such papers and information as they may
reasonably request to enable them to pass upon such matters;
(c) Xxxx and Xxxx LLP, counsel for the Company, shall have furnished to
you their written opinion, dated such Time of Delivery, in form and
substance satisfactory to you, substantially in the form set forth in
Schedule 7(b);
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(d) Xxxxxxx Berlin Shereff Xxxxxxxx, LLP, counsel for the Company, shall
have furnished to you their written opinion, dated the Time of Delivery, in
form and substance satisfactory to you, substantially in the form set forth
in Schedule 7(c).
(e) On the date of the Prospectus at a time prior to the execution of this
Agreement, at 9:30 a.m., New York City time, on the effective date of any
post-effective amendment to the Registration Statement filed subsequent to
the date of this Agreement and also at each Time of Delivery,
PricewaterhouseCoopers LLP shall have furnished to you a letter or letters,
dated the respective dates of delivery thereof, in form and substance
satisfactory to you, to the effect set forth in Annex I hereto (the
executed copy of the letter delivered prior to the execution of the
Agreement is attached as Annex 1(a) hereto and a draft of the form of
letter to be delivered on the effective date of any post-effective
amendment to the Registration Statement and as of each Time of Delivery is
attached as Annex 1(b) hereto);
(f)(i) Neither the Company nor its Subsidiary shall have sustained since
the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any loss or interference with
its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental
action, order or decree, otherwise than as set forth or contemplated in the
Prospectus, and (ii) since the respective dates as of which information is
given in the Prospectus there shall not have been any change in the capital
stock or long-term debt of the Company or its Subsidiary or any change, or
any development involving a prospective change, in or affecting the general
affairs, management, financial position, stockholders' equity or results of
operations of the Company and its Subsidiary, otherwise than as set forth
or contemplated in the Prospectus, the effect of which, in any such case
described in Clause (i) or (ii), is in the judgment of the Representatives
so material and adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the Shares being
delivered at such Time of Delivery on the terms and in the manner
contemplated in the Prospectus;
(g) On or after the date hereof (i) no downgrading shall have occurred in
the rating accorded the Company's securities by any "nationally recognized
statistical rating organization", as that term is defined by the Commission
for purposes of Rule 436(g)(2) under the Act, and (ii) no such organization
shall have publicly announced that it has under surveillance or review,
with possible negative implications, its rating of any of the Company's
debt securities or preferred stock;
(h) On or after the date hereof there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally on the New York Stock Exchange or on NASDAQ; (ii) a suspension or
material limitation in trading in the Company's securities on NASDAQ; (iii)
a general moratorium on commercial banking activities declared by either
Federal or New York State authorities; or (iv) the outbreak or escalation
of hostilities involving the United States or the declaration by the United
States of a national emergency or war, if the effect of any such event
specified in this Clause (iv) in the judgment of the Representatives makes
it impracticable or inadvisable to proceed with the public offering or the
delivery of the Shares being delivered at such Time of Delivery on the
terms and in the manner contemplated in the Prospectus;
(i) The Shares at such Time of Delivery shall have been duly listed for
quotation on NASDAQ;
(j) The Company shall have complied with the provisions of Section 5(c)
hereof with respect to the furnishing of prospectuses on the New York
Business Day next succeeding the date of this Agreement; and
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(k) The Company shall have furnished or caused to be furnished to you at
such Time of Delivery certificates of officers of the Company and the
Selling Stockholders, respectively satisfactory to you as to the accuracy
of the representations and warranties of the Company herein at and as of
such Time of Delivery, as to the performance by the Company of all of its
respective obligations hereunder to be performed at or prior to such Time
of Delivery, as to the matters set forth in subsections (a) and (f) of this
Section, and as to such other matters as you may reasonably request.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or any amendment or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse each Underwriter as the case may be,
for any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in any Preliminary Prospectus, the
Registration Statement or the Prospectus or any such amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through Xxxxxxx, Sachs & Co. expressly for use
therein.
(b) Each Underwriter will indemnify and hold harmless the Company against
any losses, claims, damages or liabilities, joint or several, to which the
Company may become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon an untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
in each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, the Registration Statement or the Prospectus or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through Xxxxxxx, Xxxxx
& Co. expressly for use therein; and will reimburse the Company for any legal or
other expenses reasonably incurred by the Company in connection with
investigating or defending any such action or claim as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability hereunder to the extent it is not materially
prejudiced as a result thereof (but shall relieve it from any liability under
Section 8(a) or 8(b), as the case may be, to the extent the indemnifying party
is materially prejudiced) and in any event shall not relieve it from any
liabilities which it may have to any indemnified party otherwise than under such
subsection. In case any such action shall be brought against any indemnified
party and it shall notify the indemnifying party of the commencement thereof,
the indemnifying party shall be entitled to participate therein and, to the
extent that it shall wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party), and, after notice from
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the indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party shall not be liable to such
indemnified party under such subsection for any legal expenses of other counsel
or any other expenses, in each case subsequently incurred by such indemnified
party, in connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the written consent of the
indemnified party, effect the settlement or compromise of, or consent to the
entry of any judgment with respect to, any pending or threatened action or claim
in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to such
action or claim) unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability arising out of
such action or claim and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act, by or on behalf of any indemnified
party. No indemnifying party shall be required to indemnify an indemnified party
for any amount paid or payable by such indemnified party in the settlement of
any action, proceeding or investigation without the written consent of such
indemnifying party, which consent shall not be unreasonably withheld.
(d) If the indemnification provided for in this Section 8 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a)
above in respect of any losses, claims, damages or liabilities (or actions in
respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Underwriters on the other from the
offering of the Shares. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the indemnified
party failed to give the notice required under subsection (c) above, then each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one hand and
the Underwriters on the other in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions in
respect thereof), as well as any other relevant equitable considerations. The
relative benefits received by the Company 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
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 on the one hand or the Underwriters on the other and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and the Underwriters
agree that it would not be just and equitable if contributions pursuant to this
subsection (d) were determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to above in this subsection (d). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to above in this subsection (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages 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
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Underwriters' obligations in this subsection (d) to contribute are several in
proportion to their respective underwriting obligations and not joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 9 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company and to each
person, if any, who controls the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Shares which it has agreed to purchase hereunder at a Time of Delivery, you
may in your discretion arrange for you or another party or other parties to
purchase such Shares on the terms contained herein. If within thirty-six hours
after such default by any Underwriter you do not arrange for the purchase of
such Shares, then the Company shall be entitled to a further period of
thirty-six hours within which to procure another party or other parties
satisfactory to you to purchase such Shares on such terms. In the event that,
within the respective prescribed periods, you notify the Company that you have
so arranged for the purchase of such Shares, or the Company notifies you that
they have so arranged for the purchase of such Shares, you or the Company shall
have the right to postpone a Time of Delivery for a period of not more than
seven days, in order to effect whatever changes may thereby be made necessary in
the Registration Statement or the Prospectus, or in any other documents or
arrangements, and the Company agrees to file promptly any amendments to the
Registration Statement or the Prospectus which in your opinion may thereby be
made necessary. The term "Underwriter" as used in this Agreement shall include
any person substituted under this Section with like effect as if such person had
originally been a party to this Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased does not exceed one-eleventh of the aggregate number of all
the Shares to be purchased at such Time of Delivery, then the Company shall have
the right to require each non-defaulting Underwriter to purchase the number of
Shares which such Underwriter agreed to purchase hereunder at such Time of
Delivery and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Shares which such
Underwriter agreed to purchase hereunder) of the Shares of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased exceeds one-eleventh of the aggregate number of all of the
Shares to be purchased at such Time of Delivery, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Shares of a defaulting Underwriter or Underwriters,
then this Agreement (or, with respect to the Second Time of Delivery, the
obligations of the Underwriters to purchase and of the Company to sell the
Optional Shares) shall thereupon terminate, without liability on the part of any
non-defaulting Underwriter or the Company, except for the expenses to be borne
by the Company and the Underwriters as provided in Section 6 hereof and the
indemnity and contribution agreements in Section 8 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, and the several Underwriters as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall
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remain in full force and effect, regardless of any investigation (or any
statement as to the results thereof) made by or on behalf of any Underwriter or
any controlling person of any Underwriter, or the Company or any officer or
director or controlling person of the Company, and shall survive delivery of and
payment for the Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
the Company shall not then be under any liability to any Underwriter except as
provided in the second sentence of Section 6 hereof; but, if for any other
reason the Shares are not delivered by or on behalf of the Company as provided
herein, the Company will reimburse the Underwriters through you for all
out-of-pocket expenses approved in writing by you, including fees and
disbursements of counsel, reasonably incurred by the Underwriters in making
preparations for the purchase, sale and delivery of the Shares not so delivered,
but the Company shall then be under no further liability to any Underwriter in
respect of the Shares not so delivered except as provided in the second sentence
of Section 6 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by Xxxxxxx, Xxxxx & Co. on behalf of you as the
representatives.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the representatives in care of Xxxxxxx, Sachs &
Co., 00 Xxx Xxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Registration
Department; and if to the Company shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: Secretary; provided, however, that any notice
to an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by
mail, telex or facsimile transmission to such Underwriter at its address set
forth in its Underwriters' Questionnaire or telex constituting such
Questionnaire, which address will be supplied to the Company by you on request.
Any such statements, requests, notices or agreements shall take effect upon
receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters and the Company to the extent provided in Sections [ ] and
[ ] hereof, the officers and directors of the Company and each person who
controls the Company, or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Shares from any Underwriter shall be deemed a successor or assign by reason
merely of such purchase.
14. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
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If the foregoing is in accordance with your understanding, please sign and
return to us one for the Company and each of the Representatives plus one for
each counsel counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof shall
constitute a binding agreement among each of the Underwriters and the Company.
It is understood that your acceptance of this letter on behalf of each of the
Underwriters is pursuant to the authority set forth in a form of Agreement among
Underwriters, the form of which shall be submitted to the Company for
examination upon request, but without warranty on your part as to the authority
of the signers thereof.
Very truly yours,
NETWORK PLUS CORP.
By: ......................
Name:
Title:
Accepted as of the date hereof,
Xxxxxxx, Xxxxx & Co.
Bear, Xxxxxxx & Co. Inc.
By:.........................................
(Xxxxxxx, Xxxxx & Co.)
On behalf of each of the Underwriters
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SCHEDULE I
NUMBER OF OPTIONAL
TOTAL NUMBER SHARES TO BE
OF FIRM SHARES PURCHASED IF
TO BE MAXIMUM OPTION
UNDERWRITER PURCHASED EXERCISED
----------- -------------- ------------------
XXXXXXX, SACHS & CO. ...............................................
BEAR, XXXXXXX & CO. INC. ...........................................
TOTAL ..............................................................
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ANNEX I
Pursuant to Section 7(e) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect to
the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements, any supplementary
financial information and schedules, and pro forma financial information
examined by them and included in the Prospectus or the Registration
Statement comply as to form in all material respects with the applicable
accounting requirements of the Act and the 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, financial forecasts 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 separately furnished to the representatives of the
Underwriters (the "Representatives");
(iii) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets
and consolidated statements of cash flows included in the Prospectus as
indicated in their reports thereon copies of which have been separately
furnished to the Representatives and on the basis of specified procedures
including inquiries of officials of the Company who have responsibility for
financial and accounting matters regarding whether the unaudited condensed
consolidated financial statements referred to in paragraph (vi)(A)(i) below
comply as to form in all material respects with the applicable accounting
requirements of the Act and the related published rules and regulations,
nothing came to their attention that caused them to believe that the
unaudited condensed consolidated financial statements 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;
(iv) 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 restatements where applicable) in the
audited consolidated financial statements for such five fiscal years which
were included or incorporated by reference in the Company's Annual Reports
on Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and on
the basis of limited procedures specified in such letter nothing came to
their attention as a result of the foregoing procedures that caused them to
believe that this information does not conform in all material respects
with the disclosure requirements of Items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
(vi) 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 its subsidiaries, inspection of the
minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included in the
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Prospectus, inquiries of officials of the Company and its subsidiaries
responsible for financial and accounting matters and such other inquiries
and procedures as may be specified in such letter, nothing came to their
attention that caused them to believe that:
(A) (i) the unaudited consolidated 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, or (ii) any material
modifications should be made to the unaudited condensed consolidated
statements of income, consolidated balance sheets and consolidated
statements of cash flows included in the Prospectus for them to be in
conformity with generally accepted accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited consolidated
financial statements included in the Prospectus;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived any unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in clause (B) were not determined on a
basis substantially consistent with the basis for the audited
consolidated financial statements included in the Prospectus;
(D) any unaudited pro forma consolidated condensed financial
statements included in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of the
Act and the published rules and regulations thereunder or the pro
forma adjustments have not been properly applied to the historical
amounts in the compilation of those statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the consolidated
capital stock (other than issuances of capital stock upon exercise of
options and stock appreciation rights, upon earn-outs of performance
shares and upon conversions of convertible securities, in each case
which were outstanding on the date of the latest financial statements
included in the Prospectus) or any increase in the consolidated
long-term debt of the Company and its subsidiaries, or any decreases
in consolidated net current assets or stockholders' equity or other
items specified by the Representatives, or any increases in any items
specified by the Representatives, in each case as compared with
amounts shown in the latest balance sheet included in the Prospectus,
except in each case for changes, increases or decreases which the
Prospectus discloses have occurred or may occur or which are described
in such letter; 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 were any decreases in consolidated net revenues
or operating profit or the total or per share amounts of consolidated
net
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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 decreases or increases which
the Prospectus discloses have occurred or may occur or which are
described in such letter; and
(G) In addition to the examination referred to in their
report(s) included in the Prospectus and the limited procedures,
inspection of minute books, inquiries and other procedures referred to
in paragraphs (iii) and (vi) 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 its subsidiaries, which appear in the Prospectus,
or in Part II of, or in exhibits and schedules to, the Registration
Statement specified by the Representatives, and have compared certain
of such amounts, percentages and financial information with the
accounting records of the Company and its subsidiaries and have found
them to be in agreement.
22
SCHEDULE 7(b)
[To be replaced by draft of actual opinion]
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SCHEDULE 7(c)
(i)(A) The execution, delivery, and performance of this Agreement by
the Company and the issue and sale of the Shares, do not violate (1) the
Communications Act applicable to the Company and/or its Subsidiary, (2) any
State Telecommunications laws applicable to the Company and/or its Subsidiary,
and (3) to the best of such counsel's knowledge, any decree from any court, and
(B) except as set forth in Schedule A, no authorization of or filing with the
FCC or any State Regulatory Agency that has not been received or made is
necessary for the execution and delivery of this Agreement by the Company and
the issue and sale of Shares contemplated hereby in accordance with the terms
hereof;
(ii) Network Plus is authorized by the FCC to provide domestic
interstate interexchange telecommunications services as a nondominant carrier
pursuant to 47 C.F.R. ss. 63.07(a) (1997) without any further order, license,
permit or other authorization by the FCC. Network Plus has been granted Section
214 authority by the FCC to provide international message telecommunications
services and private line services through the resale of international switched
voice and private line services and/or by using its own facilities and has on
file with the FCC tariffs applicable to its domestic interstate and
international services;
(iii) Network Plus is certified, registered or otherwise authorized,
or is not required to obtain authority to resell intrastate interexchange
telecommunications services in all U.S. states except Alaska. To the best of
such counsel's knowledge, Network Plus has a tariff on file in each of the
states in which a tariff is required to be filed;
(iv) (A) To the best of such counsel's knowledge except as set forth
in paragraph (v) of this letter, Network Plus (1) has filed all reports and
filings, and paid all fees, required by the FCC and the State Regulatory
Agencies except for those reports and filings the failure to file of which, and
those fees the failure to pay of which, would not have a material adverse effect
on the Company and Network Plus taken as a whole ("Material Adverse Effect");
and (2) based on such counsel's understanding of the Network Plus operations
from the Certificate, it has all certificates, orders, permits, licenses,
authorizations, consents and approvals of and from (the "Authorizations"), and
has made all filings and registrations with the FCC and the State Regulatory
Agencies necessary to own, lease, license and use its properties and assets and
to conduct its business in the manner described in the Prospectus except for
those Authorizations the failure to obtain which, and those filings and
registrations the failure to file which, would not have a Material Adverse
Effect; and (B) to the best of such counsel's knowledge, Network Plus has not
received any notice of proceedings relating to the revocation or modification of
any such certificates, orders, permits, licenses, authorizations, consents or
approvals, or the disqualification or rejection of any such filing or
registration, the effect of which, singly or in the aggregate, would have a
Material Adverse Effect;
(v) To the best of such counsel's knowledge, based on such counsel's
understanding of the operations of Network Plus from the Certificate, other than
as stated in this paragraph (v) and on Schedule B, neither the Company nor
Network Plus is in violation of, or in default under, the Communications Act or
State Telecommunications Laws, the effect of which, singly or in the aggregate,
would have a Material Adverse Effect;
(vi) To the best of such counsel's knowledge (A) as of the date
hereof, no unsatisfied decree or order of the FCC or any State Regulatory Agency
is outstanding against the Company or its Subsidiary and (B)except as set forth
in Schedule C, no litigation, proceeding, inquiry or investigation has been
commenced or threatened, no
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complaints filed, no notice of violation or order to show cause has been issued,
against the Company or its Subsidiary before or by the FCC or any State
Regulatory Agency; and
(vii) The statements in the Prospectus under the captions "Risk
Factors--Competition in our industry is intense and growing and we may be unable
to compete effectively", "Risk Factors--The Telecommunications Act of 1996 and
other regulations could adversely affect us", "Business--Market Opportunity",
"Business--Competition" and "Government--Regulation", insofar as such statements
constitute a summary of the telecommunications legal matters, documents or
proceedings of the FCC and State Regulatory Agencies with respect to
telecommunications regulations referred to therein, are accurate in all material
respects and fairly summarize all such matters referred to therein.
In connection with the preparation of the Prospectus, such counsel
have participated in conferences with officers and representatives of the
Company, counsel for the Underwriters and corporate counsel to the Company, at
which conferences such counsel have made inquiries of such persons and others
and discussed the contents of the Prospectus. On the basis of such counsel's
participation, inquiries and discussions, no facts have come to such counsel's
attention that have caused them to believe that the sections in the Prospectus
under the captions "Risk Factors--Competition in our industry is intense and
growing and we may be unable to compete effectively", "Risk Factors--The
Telecommunications Act of 1996 and other regulations could adversely affect us",
"Business--Market Opportunity", "Business--Competition" and
"Government--Regulation", at the Time of Delivery, contained any untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading.
