GENERAL MARITIME CORPORATION
__________ Shares of Common Stock
(par value $.01 per share)
UNDERWRITING AGREEMENT
New York, New York
November ___, 2000
ING Barings LLC
▇▇▇▇▇▇ Brothers Inc.
▇▇▇▇▇▇▇▇▇ & Company, Inc.
As Representatives of the
several Underwriters
c/o ING Barings LLC
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
General Maritime Corporation, a ▇▇▇▇▇▇▇▇ Islands corporation (the
"Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the several underwriters named in Schedule I hereto (the
"Underwriters") for whom ING Barings LLC, ▇▇▇▇▇▇ Brothers Inc. and ▇▇▇▇▇▇▇▇▇ &
Company, Inc. are acting as representatives (the "Representatives") an aggregate
of __________ shares (the "Firm Shares") of its common stock, par value $0.01
per share (the "Common Stock"). The Company also proposes to issue and sell to
the Underwriters an aggregate of not more than ____________ additional shares of
Common Stock (the "Option Shares") to cover over-allotments, if requested by the
Underwriters in accordance with Section 2(c) hereof. The Firm Shares and the
Option Shares are referred to herein as the "Shares". The words "you" and "your"
refer to the Representatives.
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants to and agrees with each of the Underwriters that:
(a) The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-1 (No.
333-_____), for the registration of the Shares under the Securities Act of 1933,
as amended (the "Act"). Such registration statement, including the prospectus,
financial statements and schedules, exhibits and all other documents filed as a
part thereof, as amended through the time of effectiveness of the registration
statement, including any information deemed to be a part thereof as of the time
of effectiveness pursuant to Rule 430A or Rule 434 of the Rules and Regulations
of the Commission under the Act (the "Regulations"), is herein called the
"Registration Statement."
Any registration statement filed by the Company pursuant to Rule 462(b) under
the Act is herein called the "Rule 462(b) Registration Statement", and from and
after the date and time of filing of the Rule 462(b) Registration Statement the
term "Registration Statement" shall include the Rule 462(b) Registration
Statement. The prospectus, in the form first filed with the Commission pursuant
to Rule 424(b) of the Regulations or filed as part of the Registration Statement
at the time of effectiveness if no Rule 424(b) or Rule 434 filing is required,
is herein called the "Prospectus". The term "preliminary prospectus" as used
herein means a preliminary prospectus included in the Registration Statement at
the time it is declared effective as described in Rule 430A of the Regulations;
PROVIDED, HOWEVER, if the Company has, with the consent of the Representatives,
elected to rely upon Rule 434 under the Act, the term "Prospectus" shall mean
the Company's prospectus subject to completion dated _______, 2000 (such
preliminary prospectus is herein called the "Rule 434 preliminary prospectus"),
together with the applicable term sheet (the "Term Sheet") prepared and filed by
the Company with the Commission under Rules 434 and 424(b) under the Act and all
references in this Agreement to the date of the Prospectus shall mean the date
of the Term Sheet. All references in this Agreement to the Registration
Statement, the Rule 462(b) Registration Statement, a preliminary prospectus, the
Prospectus or the Term Sheet, or any amendments or supplements to any of the
foregoing, shall include any copy thereof filed with the Commission pursuant to
its Electronic Data Gathering, Analysis and Retrieval System ("▇▇▇▇▇").
(b) Each preliminary prospectus and the Prospectus, if filed by
electronic transmission pursuant to ▇▇▇▇▇ (except as may be permitted by
Regulation S-T under the Securities Act), was identical to the copy thereof
delivered to the Underwriters for use in connection with the offer and sale of
the Shares. At the time of the effectiveness of the Registration Statement or
the effectiveness of any Rule 462(b) Registration Statement and any
post-effective amendment thereto, when the Prospectus is first filed with the
Commission pursuant to Rule 424(b) or Rule 434 of the Regulations, when any
supplement to or amendment of the Prospectus is filed with the Commission and at
the Closing Date and the Additional Closing Date, if any (as defined in Section
2(c)), the Registration Statement and the Prospectus and any amendments thereof
and supplements thereto complied (and, in the event of any of the aforementioned
filings that may occur in the future will, at the time of such filing(s),
comply) in all material respects with the applicable provisions of the Act and
the Regulations, did not and will not contain an untrue statement of a material
fact and did not and will not omit to state any material fact required to be
stated therein or necessary in order to make the statements therein not
misleading. When any related preliminary prospectus was first filed with the
Commission (whether filed as part of the Registration Statement for the
registration of the Shares or any amendment thereto or pursuant to Rule 424(a)
of the Regulations) and when any amendment thereof or supplement thereto was
first filed with the Commission, such preliminary prospectus and any amendments
thereof and supplements thereto complied in all material respects with the
applicable provisions of the Act and the Regulations and did not contain an
untrue statement of a material fact and did not omit to state any material fact
required to be stated therein or necessary in order to make the statements
therein not misleading. No representation and warranty is made in this
subsection (b), however, with respect to any information contained in or omitted
from the Registration Statement or the Prospectus or any related preliminary
prospectus or any amendment thereof or supplement thereto in reliance upon and
in conformity with information
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relating to the Underwriters furnished in writing to the Company by or on behalf
of any Underwriter through you expressly for use in connection with the
preparation thereof. The Commission has not issued any order preventing or
suspending the use of any preliminary prospectus and has not instituted or
threatened to institute any proceedings with respect to such an order. If Rule
434 is used, the Company will comply with the requirements of Rule 434.
(c) Each of the Company and each of its direct and indirect
subsidiaries (the "Subsidiaries") has been duly organized and is validly
existing as a corporation, limited partnership or limited liability company in
good standing under the laws of its jurisdiction of organization, with full
corporate power and authority to own, lease and operate its properties and
engage in the business in which it is engaged or in which it proposes to engage
as described in the Registration Statement, the preliminary prospectus and the
Prospectus. Each of the Company and the Subsidiaries is duly registered and
qualified to do business as a foreign corporation in good standing in each
jurisdiction where the character, location, ownership or leasing of its
properties (owned, leased or licensed) or the nature or conduct of its business
requires such registration or qualification, except where the failure to be so
qualified would not, individually or in the aggregate, result in a material
adverse effect on or affecting the business, operations, assets, properties,
condition (financial or other), stockholders' equity, prospects or results of
operations of the Company and its Subsidiaries taken as a whole (a "Material
Adverse Effect").
(d) Ernst & Young LLP and Deloitte & Touche LLP, the accountants who
have expressed their opinion with respect to the financial statements (including
the related notes and supporting schedules) of the Company filed with the
Commission as a part of the Registration Statement, the preliminary prospectus
and the Prospectus, are, with respect to the Company and each Subsidiary,
independent public accountants as required by the Act and the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
(e) As of the date hereof, the Company has an authorized capitalization
as set forth in the Registration Statement, the preliminary prospectus and the
Prospectus and there has been no material change in its capitalization since
that date. All outstanding shares of capital stock of the Company have been duly
authorized and validly issued and are fully paid and nonassessable, have been
issued in compliance with all federal and state securities laws and were not
issued in violation of any preemptive right, resale right, registration right,
right of first refusal or similar right. The authorized and outstanding capital
stock of the Company conforms to the description thereof contained in the
Registration Statement, the preliminary prospectus and the Prospectus (and such
description correctly states, in all material respects, the substance of the
provisions of the instruments defining the capital stock of the Company). Except
as described in the Registration Statement, the preliminary prospectus and the
Prospectus, there are no authorized or outstanding rights (including, without
limitation, preemptive rights, co-sale rights, resale rights, rights of first
refusal or similar rights), warrants or options to acquire, or instruments
convertible into or exercisable or exchangeable for, any share of capital stock
or other equity interest or ownership interest in the Company, or any Subsidiary
or any contract, commitment, agreement, understanding or arrangement of any kind
relating to the issuance of any capital stock or other equity interest or
ownership interest in the Company, or any Subsidiary or any such convertible or
exercisable or exchangeable securities or instruments or any such
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rights, warrants or options, except for any such rights that have been
effectively waived in writing so as not to be exercisable in connection with the
registration, offer or sale of the Shares. The Shares to be issued pursuant to
this Agreement will not be issued in violation of any preemptive right, co-sale
right, resale right, right of first refusal or similar right. The description of
the Company's stock option, stock bonus and other stock plans or arrangements,
and the options or other rights granted thereunder, set forth in the
Registration Statement, the preliminary prospectus and the Prospectus accurately
and fairly presents, in all material respects, the information required to be
shown with respect to such plans, arrangements, options and rights. The Shares
have been duly authorized for issuance and, when issued and delivered to and
paid for by the Underwriters pursuant to this Agreement, will be validly issued,
fully paid and nonassessable, good title to the Shares will be transferred to
the Underwriters free and clear of any liens, encumbrance, security interest or
claim (each a "Lien") and the certificates representing the Shares will be in
valid and sufficient form. All the outstanding shares of capital stock of each
Subsidiary have been duly authorized and validly issued, are fully paid and
nonassessable and are owned directly or indirectly by the Company, free and
clear of any Lien, other than security interests granted in connection with
financing and other transactions relating to ship-owning subsidiaries of the
Company.
(f) Other than the description under the caption "Business-Legal
Proceedings" in the Registration Statement, there is (i) no action, suit or
proceeding or, to the knowledge of the Company, no investigation, before or by
any court, arbitrator or governmental agency, body or official, domestic or
foreign, pending or, to the knowledge of the Company, threatened or
contemplated, as to which the Company, or any Subsidiary is (or, to the extent
threatened or contemplated, will be) a party or as to which the business, assets
or property of the Company, or any Subsidiary (or, to the extent threatened or
contemplated, will be) subject, (ii) no statute, rule, regulation or order that
has been enacted, adopted or issued by any governmental agency, body or
official, and (iii) no injunction, restraining order or order of any nature that
has been issued by a federal or state court or foreign court of competent
jurisdiction to which the Company, or any Subsidiary is or will be subject or
affecting the business, assets or property of the Company or any Subsidiary,
that could reasonably be expected to (in the case of clauses (i), (ii) and
(iii)), individually or in the aggregate, whether or not arising from
transactions in the ordinary course of business, have a Material Adverse Effect,
be required to be disclosed in the Registration Statement, the preliminary
prospectus or the Prospectus or materially and adversely affect the ability of
the Company to perform its obligations under this Agreement. There are no legal
or administrative proceedings, Contracts (as defined below) or documents
concerning the Company or any Subsidiary of a character that would be required
to be described in or filed as an exhibit to a registration statement on Form
S-1 under the Act that are not described or filed, as required, in the
Registration Statement, the preliminary prospectus and the Prospectus. The
transactions described under the caption "Recapitalization" in the Prospectus
have been completed in all material respects as so described.
(g) The financial statements of the Company, together with the related
notes thereto, which are a part of the Registration Statement, preliminary
prospectus and the Prospectus, present fairly in all material respects the
financial position and the results of operations, changes in stockholders'
equity and changes in cash flows of the Company as of the
4
respective dates and for the respective periods specified therein. All of such
financial statements and related notes have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the periods involved and comply as to form in all material respects
with the applicable accounting requirements included in Regulation S-X under the
Act. The supporting schedules, the "Summary Financial and Other Data", the
"Selected Consolidated Financial and Other Data", the "Management's Discussion
and Analysis of Financial Condition and Results of Operations" and the financial
tables included in the Registration Statement, the preliminary prospectus and
the Prospectus fairly present the information purported to be shown thereby at
the respective dates thereof and for the respective periods covered thereby and
have been presented on a basis consistent with that of the audited financial
statements therein. No other financial statements or supporting schedules are
required by the Act or Regulation S-X to be included therein.
(h) Subsequent to the respective dates as of which information is given
in the Registration Statement, the preliminary prospectus and the Prospectus,
there has not been (i) any loss or adverse change, or any development which
could reasonably be expected to result in a loss or adverse change, in or
affecting the business, properties, management, assets, prospects, stockholders'
equity, operations, condition (financial or other), or results of operations of
the Company and its subsidiaries taken as a whole, (ii) any transaction entered
into by the Company, or any Subsidiary, except transactions in the ordinary
course of business; (iii) any obligation, direct or contingent, incurred by the
Company or any Subsidiary which is material to the Company and the Subsidiaries
taken as a whole, except for liabilities or obligations which are reflected in
the Registration Statement, the preliminary prospectus and the Prospectus, (iv)
any change in the capital stock or outstanding indebtedness of the Company, or
(v) any dividend or distribution of any kind declared, paid or made on the
capital stock of the Company, which in any case described in clauses (i), (ii),
(iii), (iv) or (v) above, could reasonably be expected to, individually or in
the aggregate, have a Material Adverse Effect on the Company and the
Subsidiaries taken as a whole or materially and adversely affect the ability of
the Company to perform its obligations under this Agreement.
(i) The Company and the Subsidiaries have good and marketable title to
all properties and assets described in the Registration Statement, the
preliminary prospectus and the Prospectus as being owned by them, free and clear
of all Liens except Liens for taxes not yet due and payable. The Company and the
Subsidiaries have valid and enforceable leases for the properties leased by
them, the Company and the Subsidiaries enjoy peaceful and undisturbed possession
under all such leases with such exceptions as do not materially interfere with
the use thereof made by the Company and the Subsidiaries, and such leases
conform in all material respects to the descriptions thereof, if any, set forth
in the Registration Statement, the preliminary prospectus and the Prospectus.
The Company and the Subsidiaries own, lease or otherwise have rights to use all
properties and assets as are important to their respective operations as now
conducted and as proposed to be conducted.
(j) The Company and the Subsidiaries have all requisite corporate power
and authority, and all licenses, certificates, approvals, consents, concessions,
qualifications, orders, registrations, authorizations and permits from all
federal, state, foreign and other governmental
5
and regulatory agencies, bodies and authorities ("Permits") that are material to
and necessary for the conduct of the business of the Company and the
Subsidiaries as such business is currently conducted. The Company reasonably
believes that it will be able to obtain Permits that are material to and
necessary for the conduct of the business of the Company and the Subsidiaries as
such business is proposed to be conducted as described in the Registration
Statement, the preliminary prospectus and the Prospectus. All such Permits are
valid and in full force and effect and there is no proceeding pending or, to the
best knowledge of the Company, threatened, which could reasonably be expected to
cause any such Permit to be withdrawn, canceled, suspended or not renewed. The
Company and the Subsidiaries are not in violation of, or in default under, and
have fulfilled and performed all their obligations with respect to, such
Permits, except as would not have a Material Adverse Effect. No event has
occurred which allows or would allow revocation or termination of any such
Permit or result in any material impairment of the rights of the holder of any
such Permit. The Contracts to which the Company or any Subsidiary is a party are
valid and binding agreements, enforceable against the Company or such Subsidiary
in accordance with their terms and, to the best of the Company's knowledge, the
other contracting party or parties thereto are not in breach or default under
any of such Contracts, except in each case as would not have a Material Adverse
Effect. The descriptions in the Registration Statement of Contracts and other
documents are accurate and fairly present the information required to be shown
with respect thereto by the Act and the Rules and Regulations, and there are no
contracts or other documents which are required by the Act or the Rules and
Regulations to be described in the Registration Statement or filed as exhibits
to the Registration Statement which are not described or filed as required, and
the exhibits which have been filed are complete and correct copies of the
documents of which they purport to be copies.
(k) The Company and the Subsidiaries are not (i) in violation of their
respective certificates of incorporation, as amended, or other constitutive
documents, as the case may be, or bylaws, as amended or (ii) in breach of or
default in the performance or observance of any obligation, agreement, covenant
or condition contained in any contract, indenture, mortgage, loan agreement,
franchise, joint venture, deed of trust, bond, note, lease, Permit or other
agreement or instrument to which the Company or such Subsidiary is a party or by
which the Company or such Subsidiary may be bound or to which any of the
property or assets of the Company or such Subsidiary is subject (each a
"Contract"), or in violation of any law, order, rule, regulation, writ,
injunction or decree of any court or governmental agency, body or authority,
except in the case of this clause (ii) for such breaches, defaults or violations
that could not reasonably be expected to, individually or in the aggregate, have
a Material Adverse Effect on the Company and the subsidiaries taken as a whole
or materially and adversely affect the ability of the Company to perform its
obligations under this Agreement.
(l) Subsequent to the most recent respective dates as of which
information is given in the Prospectus (or, if the Prospectus is not in
existence, the most recent preliminary prospectus), and except as expressly
contemplated therein, neither the Company nor any of the Subsidiaries has
incurred, other than in the ordinary course of its business, any material
liabilities or obligations, direct or contingent, purchased any of its
outstanding capital stock, paid or declared any dividends or other distributions
on its capital stock or entered into any material transactions not in the
ordinary course of business, and there has been no material change in
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capital stock or debt or any material adverse change in the business,
properties, assets, net worth, condition (financial or other), or results of
operations or prospects of the Company and the Subsidiaries taken as a whole.
(m) The Company and its Subsidiaries own or possess, or can acquire on
reasonable terms, all material patents, patent applications, trademarks, service
marks, trade names, licenses, copyrights and proprietary or other confidential
information currently employed by them in connection with their respective
businesses, and neither the Company nor any such subsidiary has received such
notice of infringement of or conflict with asserted rights of any third party
with respect to any of the foregoing which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling, or finding, would result in a
Material Adverse Effect on the Company and its subsidiaries, except as described
in or contemplated by the Registration Statement, preliminary prospectus and the
Prospectus.
(n) The Company and the Subsidiaries have filed on a timely basis with
the appropriate taxing authorities (or have received an extension for filing
with respect to) all necessary federal, state and foreign income and franchise
tax returns, reports and other information required to be filed by them. Each
such tax return, report or other information was, when filed, accurate and
complete in all material respects. The Company and the Subsidiaries have duly
paid, or have made adequate charges, accruals and reserves in the financial
statements for, all such taxes required to be paid by them and any other
assessment, fine or penalty levied against them, for all periods as to which the
tax liability of the Company or Subsidiary has not been finally determined. No
tax deficiency has been or, to the best of the Company's knowledge, might be
asserted or contemplated against the Company or any Subsidiary. Neither the
Company nor any Subsidiary will incur any taxes as a result of their formation
and the transfer of the Subsidiaries' stock or other equity interests to the
Company pursuant to the contribution agreement and recapitalization plan
described in the Prospectus (or, if the Prospectus is not in existence, the most
recent preliminary prospectus) or the acquisition agreement entered into with
United Overseas Tankers, Ltd. It is expected that (i) neither the Company nor
any Subsidiary will be classified as, and the Company and each Subsidiary will
conduct their operations in a manner designed to avoid classification as, at any
time, a "controlled foreign corporation," a "foreign personal holding company",
a "passive foreign investment company", or a "personal holding company," within
the meaning of Section 957, 552, 1297 and 542, respectively, of the Internal
Revenue Code of 1986, as amended (the "Code"), and (ii) neither the Company nor
any Subsidiary will derive any income which is effectively connected with the
conduct of a trade or business within the United States for purposes of Section
882 of the Code.
(o) No Subsidiary is currently prohibited, directly or indirectly, from
paying any dividends to the Company, from making any other distribution on such
Subsidiary's capital stock, from repaying to the Company any loans or advances
to such subsidiary from the Company or from transferring any of such
subsidiary's property or assets to the Company or any other subsidiary of the
Company.
(p) The Company and each of its Subsidiaries maintain insurance of the
types and in amounts which they reasonably believe to be adequate to protect
against the accident-
7
related risks involved in the conduct of their businesses and they maintain
appropriate levels of environmental damage and pollution insurance coverage,
consistent with standard industry practice.
(q) Neither the Company nor any Subsidiary is involved in any labor
dispute, disturbance, lockout, slowdown or stoppage of employees, and, to the
best knowledge of the Company, no such dispute or disturbance is threatened or
imminent. The Company is not aware of any existing or imminent labor disturbance
by the employees of any of its principal suppliers, including, but not limited
to, suppliers of officers and crew to its vessels that could reasonably be
expected to result in a Material Adverse Effect on the Company and its
subsidiaries taken as a whole or materially and adversely affect the ability of
the Company to perform its obligations under this Agreement.
(r) Neither the Company nor any Subsidiary has violated any foreign,
federal or state law relating to discrimination in the hiring, promotion, or pay
of employees, nor any applicable foreign, federal or state wages and hours law,
nor any provisions of ERISA or the rules and regulations promulgated thereunder,
the consequences of which violation may have a Material Adverse Effect.
(s) In the ordinary course of its business, the Company periodically
reviews the effect of Environmental Laws (as defined below) on the business,
operations and properties of the Company and the Subsidiaries, in the course of
which it identifies and evaluates associated costs and liabilities (including,
without limitation, any capital or operating expenditures required for clean-up,
closure of properties, scrapping of vessels or compliance with Environmental
Laws, or any Permit, any related constraints on operating activities and any
potential liabilities to third parties). On the basis of such review, the
Company has reasonably concluded that the Company and the Subsidiaries (i) are
in compliance in all material respects with all applicable foreign, United
States federal, state and local environmental laws, rules, regulations,
treaties, statutes and codes relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes, pollutants
or contaminants including petroleum, crude oil or any fraction thereof
("Environmental Laws"), (ii) have received all Permits required of them under
applicable Environmental Laws to conduct their business as currently conducted,
(iii) are in compliance in all material respects with all terms and conditions
of any such Permit and (iv) have not received notice of any actual or potential
liability for the investigation or remediation of any disposal or release of
hazardous or toxic substances or wastes, pollutants or contaminants. No action,
proceeding, revocation proceeding, writ, injunction or claim is pending or, to
the knowledge of the Company, threatened, relating to the Environmental Laws or
to the Company's or any Subsidiary's activities involving Hazardous Materials.
"Hazardous Materials" means any material or substance (i) that is prohibited or
regulated by any Environmental Law or (ii) that has been designated or regulated
by any domestic or foreign governmental body or authority as radioactive, toxic,
hazardous or otherwise a danger to health, reproduction or the environment.
Neither the Company nor any Subsidiary has been named as a "potentially
responsible party" under the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended.
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(t) Neither the Company nor any Subsidiary has engaged in the
generation, use, manufacture, transportation or storage of any Hazardous
Materials on any of the Company's or any Subsidiary's properties or former
properties, except in compliance in all material respects with all applicable
Environmental Laws. No Hazardous Materials have been treated or disposed of on
any of the Company's or any Subsidiary's properties or on properties formerly
owned or leased by the Company or any Subsidiary during the time of such
ownership or lease, except in compliance in all material respects with
Environmental Laws.
(u) No payments or inducements have been made or given, directly or
indirectly, to any federal or local official or candidate for, any federal or
state office in the United States or foreign offices by the Company or any
Subsidiary, by any of their officers, directors, employees or agents or, to the
best knowledge of the Company, by any other person in connection with any
opportunity, Contract, Permit, certificate, consent, order, approval, waiver or
other authorization relating to the business of the Company or any Subsidiary,
except for such payments or inducements as were lawful under applicable written
laws, rules and regulations. Neither the Company nor any Subsidiary, nor any
director, officer, agent, employee or, to the knowledge of the Company, other
person associated with or acting on behalf of the Company or any Subsidiary, (i)
has used any corporate funds for any unlawful contribution, gift, entertainment
or other unlawful expense relating to political activity; (ii) made any direct
or indirect unlawful payment to any government official or employee from
corporate funds; (iii) violated or is in violation of any provision of the
Foreign Corrupt Practices Act of 1977; or (iv) made any bribe, unlawful rebate,
payoff, influence payment, kickback or other unlawful payment in connection with
the business of the Company or any Subsidiary.
(v) Neither the Company nor any Subsidiary has any liability for any
prohibited transaction (within the meaning of Section 4975(c) of the Internal
Revenue Code of 1986, as amended (the "Code") or Part 4 of Title I of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA")) and
neither the Company, any Subsidiary nor any other trade or business (whether or
not incorporated) which together with the Company or any Subsidiary would be
deemed a single employer for purposes of ERISA or the Code (an "ERISA
Affiliate") has any liability for an accumulated funding deficiency (within the
meaning of Section 412 of the Code or Section 302 of ERISA) or any complete or
partial withdrawal liability (within the meaning of Section 4201 of ERISA), or
any other liability under Title IV of ERISA that has not been satisfied in full
(including any contingent liability that could have a Material Adverse Effect),
with respect to any pension, profit sharing or other plan which is subject to
ERISA, to which the Company, any Subsidiary or any ERISA Affiliate make or ever
have made a contribution and in which any employee of the Company, any
Subsidiary is or has ever been a participant. With respect to such plans, the
Company and the Subsidiaries (and each ERISA Affiliate, to the extent that
non-compliance could give rise to joint and several liability) are in compliance
in all material respects with all applicable provisions of ERISA. Neither the
Company nor any Subsidiary has any comparable liability under any foreign
statute or law and the Company and the Subsidiaries are in compliance in all
material respects with applicable comparable foreign laws.
9
(w) The Company and the Subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's general or specific
authorization, (ii) transactions are appropriately recorded to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets, (iii) access to
assets is permitted only in accordance with management's general or specific
authorization, (iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences and (v) assets are properly accounted for and
safeguarded against loss from unauthorized use. The Company has not received
from its independent public accountants a letter describing or been informed by
them of, a substantial or material deficiency in the Company's internal
accounting controls in connection with their audit of the Company's financial
statements incorporated by reference in the Registration Statement, the
preliminary prospectus and the Prospectus.
(x) There are no outstanding loans, advances (except normal advances
for business expenses in the ordinary course of business) or guarantees of
indebtedness by the Company or any Subsidiary to or for the benefit of any of
the officers or directors or stockholders of the Company or any Subsidiary or
any of the members of the families of any of them, except as disclosed in the
Registration Statement, the preliminary prospectus and the Prospectus.
(y) No consent, approval, registration, authorization, filing,
qualification, Permit or order of or with any court or supervisory, regulatory,
administrative or governmental agency, body or authority, arbitrator or others
(including stockholders), foreign or domestic, is required in connection with
the execution and delivery of this Agreement, the issuance, sale or delivery of
the Shares to be issued, sold and delivered by the Company hereunder, or the
consummation of any other of the transactions contemplated herein or the
fulfillment of the terms hereof, except the registration under the Act of the
Shares and such consents, approvals, registrations, authorizations, filings,
qualifications, Permits or orders, as may be required under the state securities
or "Blue Sky" laws or the bylaws and rules of the National Association of
Securities Dealers, Inc. (the "NASD") or as have been obtained and which are in
full force and effect in connection with the offer, purchase and distribution by
the Underwriters of the Shares.
(z) The execution, delivery and performance by the Company of this
Agreement and the issuance and sale of the Shares and the consummation of the
transactions contemplated herein have been duly authorized by all necessary
corporate action. Neither the issuance, offer, sale or delivery of the Shares,
the execution, delivery and performance by the Company of this Agreement nor the
compliance by the Company with all the provisions hereof nor the consummation of
the transactions contemplated hereby (i) conflicts with or will conflict with,
or constitutes or will constitute a breach or violation of or a default under
(or an event that, with notice or lapse of time or both, would constitute such a
breach, violation or default), or results in or will result in the imposition of
a Lien upon any property or assets of the Company or any Subsidiary, under, any
of the terms or provisions of the certificate of incorporation or by-laws or
other organizational or constitutive documents of the Company or any Subsidiary,
nor (ii) conflicts with or will conflict with or constitutes or will constitute
a breach or violation of, or
10
a default under (or an event that with notice or the lapse of time or both would
constitute a default) or the loss of any material benefit under, or the
termination of, or results in or will result in the creation or imposition of
any Lien upon any property or assets of the Company or any Subsidiary pursuant
to, any Contract, nor (iii) violates or conflicts with or will violate or
conflict with any law, statute, rule or regulation applicable to the Company or
any Subsidiary or any judgment, decree or order applicable to the Company or any
Subsidiary of any court or supervisory, regulatory, administrative or
governmental agency, body or authority, or arbitrator having jurisdiction over
the Company or any Subsidiary or any of their respective properties or assets.
(aa) The Company has full corporate power and authority to enter into
this Agreement and to perform the transactions contemplated hereby. This
Agreement and the transactions contemplated herein have been duly and validly
authorized, executed and delivered by the Company and this Agreement constitutes
the legal, valid and binding agreement of the Company, enforceable against the
Company in accordance with its terms, except as the enforceability thereof may
be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium
or other laws now or hereafter in effect relating to or affecting creditors'
rights generally and (ii) general principles of equity (regardless of whether
such enforcement is considered in a proceeding in equity or at law) and except
to the extent that the provisions of Section 6 hereof may be limited by
applicable federal or state securities laws or unenforceable as against public
policy.
(bb) The description of the Shares in the Registration Statement, the
preliminary prospectus and the Prospectus is accurate in all material respects.
(cc) The Company is not now, and as a result of the offer and sale of
the Shares in the manner contemplated in this Agreement, the Registration
Statement, the preliminary prospectus and the Prospectus and the application of
the net proceeds of such sale as described in the section entitled "Use of
Proceeds" of the Registration Statement, the preliminary prospectus and the
Prospectus, will not be, an "investment company" or an "affiliated person" of,
or "promoter" or "principal underwriter" for, an "investment company" within the
meaning of the Investment Company Act of 1940, as amended (the "Investment
Company Act"), without taking account of any exemption arising out of the number
or type of holders of the Company's securities.
(dd) The Company has not incurred any liability for a fee, commission,
or other compensation on account of the employment of a broker or finder in
connection with the transactions contemplated by this Agreement other than the
discount contemplated hereby.
(ee) Neither the Company nor any Subsidiary nor, to the Company's best
knowledge, any of its or their officers, directors or affiliates (as defined in
Rule 501(b) of Regulation D ("Regulation D") under the Act) has taken or will
take, directly or indirectly, any action designed to cause or to result in or
that has constituted, or might reasonably be expected to cause or result in or
constitute, under the Exchange Act, or otherwise, the stabilization or
11
manipulation of the price of any security of the Company to facilitate the sale
or resale of the Shares.
(ff) The Company has not distributed and will not distribute prior to
the later of (A) the Additional Closing Date and (B) the completion of the
distribution of the Shares by the Underwriters and dealers, any offering
material (including, without limitation, content on its Website, if any, that
may be deemed to be offering material) in connection with the offering and sale
of the Shares other than the preliminary prospectus and the Prospectus.
(gg) There are no holders of securities of the Company which by reason
of the filing of the Registration Statement or otherwise in connection with the
sale of the Shares contemplated hereby, have the right to request or demand that
the Company register under the Act any of their securities in connection with
the Registration Statement, except for any such rights that have been
effectively waived in writing so as not to be exercisable in connection with the
registration, offer or sale of the Shares.
(hh) There is no tax, duty, levy, impost, deduction, charge or
withholding imposed by any political subdivision or taxing authority, domestic
or foreign, by virtue of the execution, delivery, performance or enforcement, or
to ensure the legality, validity or admissibility into evidence, of this
Agreement, and neither is it necessary that the Shares be submitted to, or filed
or recorded with, any court or other authority to ensure such legality,
validity, enforceability or admissibility into evidence. There are no transfer
taxes or other similar fees or charges under the laws of any jurisdiction,
domestic or foreign, any political subdivision thereof, or any state, required
to be paid in connection with the execution and delivery of this Agreement or
the issuance and sale by the Company of the Shares.
(ii) All necessary actions, authorizations, conditions and things
reasonably required to be taken, given, fulfilled and done by the Company and
the Subsidiaries on or prior to the date of this Agreement, have been, or on the
Closing Date or the Additional Closing Date, if any, will have been taken,
given, fulfilled and done in connection with (i) the issue of the Prospectus,
(ii) the execution and delivery of this Agreement, (iii) the execution, delivery
and issuance of the Shares, (iv) the compliance with all provisions of this
Agreement to be performed or complied with by such date, and (v) the right of
any holders of securities of the Company to request or demand that the Company
register under the Act any of their securities in connection with the
Registration Statement.
(jj) The Shares have been approved for listing on the New York Stock
Exchange, subject only to official notice of issuance.
(kk) Except as described in the Registration Statement, the preliminary
prospectus and the Prospectus, the Company has not sold or issued any shares of
capital stock within the six month period preceding the date of the Prospectus,
all of which sales and issuances were made in compliance with the Act and the
Regulations.
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(ll) Each officer and director of the Company named under the heading
"Management" in the Prospectus, and each of the stockholders of the Company
(such stockholders of the Company, together with each officer and director of
the Company named under the heading "Management" in the Prospectus, to be
referred to individually as a "Locked-Up Party" and collectively as the
"Locked-Up Parties"), has agreed to sign an agreement substantially in the form
attached hereto as EXHIBIT A (the "Lock-up Agreements"). The Company also has
provided to counsel for the Underwriters true, accurate and complete copies of
all of the lock-up agreements presently in effect or effected hereby. The
Company has given "no transfer" instructions to its transfer agent and registrar
with respect to such securities.
(mm) Since its inception, the Company has not incurred any material
liability arising under or as a result of the application of the provisions of
the Act.
(nn) The Company meets the requirements for use of Form S-1 under the
Regulations.
Any certificate signed by an officer of the Company and delivered to
the Representatives or to counsel for the Underwriters shall be deemed to be a
representation and warranty by the Company to each Underwriter as to the matters
set forth therein.
2. PURCHASE, SALE AND DELIVERY OF THE SHARES.
(a) The Company agrees to issue and sell to the several Underwriters
the Firm Shares upon the terms herein set forth. On the basis of the
representations, warranties, covenants and agreements herein contained, but
subject to the terms and conditions herein set forth, the Company agrees to sell
to each Underwriter and each Underwriter, severally and not jointly, agrees to
purchase from the Company, at a purchase price of $_____ per Share, the number
of Firm Shares set forth opposite the respective names of the Underwriters in
Schedule I hereto plus an additional number of Firm Shares which such
Underwriter may become obligated to purchase pursuant to the provisions of
Section 9 hereof.
(b) Payment of the purchase price for the Firm Shares and the Option
Shares (if the option provided for in Section 2(c) below shall have been
exercised on or before the third full business day prior to the Closing Date)
shall be made at the offices of ING Barings LLC, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, or at such other place as shall be agreed upon by ING Barings LLC
and the Company, at 10:00 A.M. on the third full business day (as permitted
under Rule 15c6-1 under the Exchange Act) (unless postponed in accordance with
the provisions of Section 9 hereof) following the date of the effectiveness of
the Registration Statement (or, if the Company has elected to rely upon Rule
430A of the Regulations, the third or fourth full business day (as permitted
under Rule 15c6-1 under the Exchange Act) after the determination of the public
offering price of the Firm Shares), or such other time not later than five
business days after such date as shall be agreed upon by you and the Company
(such time and date of payment and delivery being herein called the "Closing
Date"); PROVIDED, HOWEVER, that if the Company has not made available to the
Underwriters copies of the Prospectus in such quantities and at
13
such places requested by the Underwriters, no later than noon on the business
day following the execution of this Agreement, ING Barings LLC may, in its sole
discretion, postpone the Closing Date until no later than two full business days
following the delivery of such copies of the Prospectus. Payment for the Firm
Shares shall be made to the Company by wire transfer in immediately available
funds to the order of the Company, against delivery, as provided hereof, of the
Firm Shares to the Underwriters. The Company shall deliver or cause to be
delivered at ING Barings LLC's election either: (i) a credit representing the
Firm Shares to an account or accounts at The Depository Trust Company, as
designated by ING Barings LLC for the accounts of ING Barings LLC and the
several Underwriters on the Closing Date, against the irrevocable release of a
wire transfer of immediately available funds for the amounts of the purchase
price there for; or (ii) certificates for the Firm Shares which shall be
registered in such name or names and in such authorized denominations as ING
Barings LLC may request on or before noon on the business day prior to the
Closing Date. The Company will permit you to examine and package such
certificates for delivery on noon on the business day prior to the Closing date.
"Business day" shall mean any day other than a Saturday, Sunday or a legal
holiday or a day on which banking institutions or trust companies are authorized
or obligated by law to close in New York City.
(c) In addition, the Company hereby grants to the Underwriters the
option to purchase, severally and not jointly, up to ____________ Option Shares,
each at the same purchase price per share to be paid by the Underwriters to the
Company for the Firm Shares as set forth in this Section 2, for the sole purpose
of covering over-allotments in the sale of Firm Shares by the Underwriters. This
option may be exercised from time to time and at any time, in whole or in part,
on or before the thirtieth day following the date of the Prospectus, by notice
from ING Barings LLC to the Company. Such notice shall set forth the aggregate
number of Option Shares as to which the option is being exercised and the date
and time, as reasonably determined by ING Barings LLC, when the Option Shares
are to be delivered (such date and time being herein sometimes referred to as
the "Additional Closing Date"); PROVIDED, HOWEVER, that the Additional Closing
Date shall not be earlier than the Closing Date or earlier than the second full
business day after the date on which the option shall have been exercised nor
later than the fifth full business day after the date on which the option shall
have been exercised (unless such time and date are postponed in accordance with
the provisions of Section 9 hereof). The Company shall deliver, or cause to be
delivered at ING Barings LLC's election either: (i) a credit representing the
Option Shares to an account or accounts at The Depository Trust Company, as
designated by ING Barings LLC for the accounts of ING Barings LLC and the
several Underwriters on the Additional Closing Date, against the irrevocable
release of a wire transfer of immediately available funds for the amount of the
purchase price therefor; or (ii) certificates for the Option Shares which shall
be registered in such name or names and in such authorized denominations as ING
Barings LLC may request at or before noon on the business day prior to the
Additional Closing Date. The Company will permit you to examine and package such
certificates for delivery at or before noon on the business day prior to the
Additional Closing Date.
14
The number of Option Shares to be sold to each Underwriter shall be the
number which bears the same ratio to the aggregate number of Option Shares being
purchased as the number of Firm Shares set forth opposite the name of such
Underwriter in Schedule I hereto (or such number increased as set forth in
Section 9 hereof) bears to the total number of Firm Shares being purchased from
the Company, subject, however, to such adjustments to eliminate any fractional
shares as ING Barings LLC in its sole discretion shall make.
(d) Time shall be of the essence and delivery at the time and place
specified in this Agreement is a further condition to the obligations of the
Underwriters.
3. OFFERING. It is understood that the several Underwriters propose to
offer the Shares for sale to the public upon the terms set forth in the
Prospectus.
4. COVENANTS OF THE COMPANY;
The Company covenants and agrees with each Underwriter that:
(a) If the Registration Statement has not been declared effective
at the time of the execution of this Agreement, the Company will use its
best efforts to cause the Registration Statement and any amendments
thereto to become effective as promptly as possible. If Rule 430A is used
or the filing of the Prospectus is otherwise required under Rule 424(b) or
Rule 434, the Company will file the Prospectus (properly completed if Rule
430A has been used) pursuant to Rule 424(b) or Rule 434 within the
prescribed time period and will provide evidence satisfactory to you of
such timely filing. If the Company elects to rely on Rule 434, the Company
will prepare and file a term sheet that complies with the requirements of
Rule 434. If the Company elects to rely on Rule 462(b) under the Act, the
Company shall file a Rule 462(b) Registration Statement with the
Commission in compliance with Rule 462(b) under the Act prior to the time
confirmations are sent or given, as specified by Rule 462(b)(2) under the
Act, and shall pay the applicable fees in accordance with Rule 111 under
the Act.
The Company will notify you immediately (and, if requested by you,
will confirm such notice in writing) (i) when the Registration Statement
and any amendments thereto become effective, (ii) of any request by the
Commission for any amendment of or supplement to the Registration
Statement, any preliminary prospectus or the Prospectus or for additional
information, (iii) of the mailing or the delivery to the Commission for
filing of any amendment of or supplement to the Registration Statement or
the Prospectus, (iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or any
post-effective amendment thereto or of the initiation, or the threatening,
of any proceedings therefor, (v) of the receipt of any comments from the
Commission, and (vi) of the receipt by the Company of any notification
with respect to the suspension of the qualification of the Shares for sale
in any jurisdiction or the initiation or threatening of any proceeding for
that purpose. If a stop order or suspension of qualification is proposed
at any time, the Company will use its best efforts to prevent the issuance
of any such stop order and, if issued, to obtain the
15
lifting thereof as soon as possible. The Company will not file any
amendment to the Registration Statement or any amendment of or supplement
to, any preliminary prospectus or the Prospectus (including the prospectus
required to be filed pursuant to Rule 424(b) or Rule 434) that differs
from the prospectus on file at the time of the effectiveness of the
Registration Statement before or after the effective date of the
Registration Statement to which you shall reasonably object in writing
after being timely furnished in advance a copy thereof.
(b) If at any time when a prospectus relating to the Shares is
required to be delivered under the Act by an Underwriter or dealer any
event shall have occurred as a result of which the Prospectus as then
amended or supplemented would, in the reasonable judgment of ING Barings
LLC, counsel to the Underwriters or the Company, include 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, or if it shall be necessary at any time to amend or supplement
the Registration Statement, the preliminary prospectus or the Prospectus
to comply with any law, the Company promptly will notify ING Barings LLC
and prepare and file with the Commission and furnish at its own expense to
the Underwriters and dealers, an appropriate amendment or supplement (in
form and substance reasonably satisfactory to ING Barings LLC) which will
correct such untrue statement or omission or so that the Registration
Statement, any preliminary prospectus and the Prospectus will comply with
the law and will use its best efforts to have any amendment to the
Registration Statement declared effective as soon as possible. If at any
time during the ninety (90) day period after the Registration Statement
becomes effective, any rumor, publication or event relating to or
affecting the Company shall occur as a result of which in the opinion of
ING Barings LLC the market price of the Shares has been or is likely to be
materially affected (regardless of whether such rumor, publication or
event necessitates a supplement to or amendment of the Prospectus), the
Company will, after notice from ING Barings LLC advising the Company to
the effect set forth above, forthwith prepare, consult with ING Barings
LLC concerning the substance of and disseminate a press release or other
public statement, reasonably satisfactory to ING Barings LLC, responding
to or commenting on such rumor, publication or event.
(c) As soon as practicable, but not later than 45 days after the
end of its fiscal quarter in which the first anniversary date of the
effective date of the Registration Statement occurs, the Company will make
generally available (within the meaning of Section 11(a) of the Act) to
its stockholders and to you an earnings statement or statements of the
Company which will satisfy the provisions of Section 11(a) of the Act and
Rule 158 of the Regulations, covering a period of at least twelve
consecutive months beginning after the effective date of the Registration
Statement; and will, during the period of five years from the date of the
Prospectus, make generally available (within the meaning of Section 11(a)
of the Act) to its stockholders as soon as practicable after the end of
each fiscal year, an annual report (including a balance sheet and
statements of financial condition, operations, cash flows and changes in
stockholders' equity of the Company, certified by the Company's
independent public accountants) and, as soon as
16
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), consolidated summary financial
information of the Company for such quarter in reasonable detail.
(d) The Company will furnish without charge to you and counsel to
the Underwriters three complete signed copies of the Registration
Statement (including exhibits thereto), and to each other Underwriter a
copy of the Registration Statement (without exhibits thereto) and, so long
as, in the reasonable opinion of counsel to the Underwriters, delivery of
a prospectus by an Underwriter or dealer may be required by the Act, as
many copies of each preliminary prospectus and the Prospectus and any
amendment or supplement thereto as you may request.
(e) The Company will arrange for the qualification of the Shares
for sale under the laws of such jurisdictions (both national and foreign)
as ING Barings LLC may designate and will make such applications, file
such documents and furnish such information as may be required for that
purpose and will maintain such qualifications in effect for so long as
required for the distribution of the Shares; PROVIDED, HOWEVER, that in no
event shall the Company be required to qualify to do business in any such
jurisdiction in which it is not already qualified or to file a general
consent to service of process in any jurisdiction in which it is not now
so required, other than in respect of suits arising out of the offering or
sale of the Shares. The Company will, from time to time, prepare and file
such statements, reports and other documents, as are or may be required to
continue such qualifications in effect for so long a period as ING Barings
LLC may request for the distribution of the Shares. The Company will
cooperate with ING Barings LLC and counsel to the Underwriters in
connection with the filings required to be made by ING Barings LLC with
the NASD and will pay the fee of the NASD in connection with its review of
the offering of the Shares and will use its best efforts to maintain
quotation of its shares on the New York Stock Exchange.
(f) During the period of five years from the effective date of the
Registration Statement, the Company will furnish to you and, upon request,
to each of the several Underwriters, without charge, copies of, in such
quantities as you or the Underwriters may request from time to time, (i)
as soon as available, all reports or other communications (financial or
other) furnished generally by the Company to its stockholders, (ii) as
soon as practicable after the end of each fiscal year, copies of the
Annual Report of the Company containing the balance sheet of the Company
as of the close of such fiscal year and statements of income,
stockholders' equity and cash flows for the year then ended and the
opinion thereon of the Company's independent public or certified public
accountants; and (iii) as soon as practicable after the filing thereof,
copies of each proxy statement, Annual Report on Form 10-K, Quarterly
Report on Form 10-Q, Current Report on Form 8-K or other report filed by
the Company with the Commission, the NASD, any other supervisory,
regulatory, administrative or governmental agency, body or authority
whether pursuant to the Exchange Act or otherwise or any national
17
securities exchange or system on which any class of securities of the
Company is listed or quoted.
(g) For a period of 180 days from the date of the Prospectus (the
"Lock-Up Period"), without the prior written consent of ING Barings LLC,
the Company and each Locked-Up Party shall not, directly or indirectly:
(1) issue, offer for sale, contract to sell, sell, pledge or otherwise
dispose of (or enter into any transaction or device which is designed to,
or could be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash settlement or
otherwise) by any person at any time in the future of) any shares of
Common Stock or securities convertible into, exercisable or exchangeable
for, or representing the right to receive, Common Stock or sell or grant
options, rights or warrants with respect to any shares of Common Stock or
any of the foregoing or announce the offering of or register for sale any
of the foregoing or any outstanding shares of Common Stock; PROVIDED,
HOWEVER, that the Company may grant options and issue and sell Common
Stock pursuant to any directors' and employees' stock plan (including any
employees' stock purchase plan), stock ownership plan, dividend
reinvestment plan, loan agreement providing for the conversion of debt, or
warrants of the Company in effect at the effective date of the
Registration Statement and which are described in the Prospectus so long
as none of those shares that may be issued to any Locked-Up Party may be
transferred during the Lock-Up Period and the Company shall enter stop
transfer instructions with its transfer agent and registrar against any
such transfer; or (2) enter into any swap, repurchase agreement, pledge,
transfer or other transaction that transfers to another, in whole or in
part, any of the economic benefits or risks of ownership of such shares of
Common Stock or other securities, whether any such transaction described
in clause (1) or (2) above is to be settled by delivery of Common Stock or
other securities, in cash or otherwise. In addition, during such period,
the Company also agrees not to file any registration statement with
respect to, and, except as provided in this Section 4(g), each of the
executive officers, directors and certain stockholders of the Company has
agreed not to make any demand for, or exercise any right with respect to,
the registration of any shares of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock without
the prior written consent of ING Barings LLC.
(h) During the period when, in the opinion of counsel to the
Underwriters, the delivery of a Prospectus by an Underwriter or dealer may
be required by the Act, the Company will comply, at its own expense, with
all requirements imposed upon it by the Commission, the Act, the
Regulations, the Exchange Act and the rules and regulations of the
Commission promulgated thereunder, so far as necessary to permit the
continuance of sales of or dealing in the Shares during such period in
accordance with the provisions hereof and the Prospectus. In addition,
during such period the Company shall file, on a timely basis, with the
Commission and the New York Stock Exchange all reports and documents
required to be filed under the Exchange Act.
(i) Each of the Company and the Subsidiaries will conduct its
business in compliance in all material respects with all applicable laws,
rules, regulations,
18
decisions, directives and orders. The Company will do and perform all
things required or necessary to be done and performed under this Agreement
by the Company on or prior to the Closing Date and to comply or cause to
be satisfied, to the extent such are within its control, the conditions
precedent to the several obligations of the Underwriters specified in
Section 8 hereof.
(j) Neither the Company nor any of its affiliates (as defined in
Regulation D under the Act), will take, directly or indirectly, any action
designed to cause or result in, or which constitutes or which might
reasonably be expected to cause, result in, or constitute, under the
Exchange Act, or otherwise, stabilization or manipulation of the price of
the shares of Common Stock of the Company to facilitate the offering and
distribution of the Shares or any other action prohibited by Regulation M
under the Exchange Act.
(k) The Company will apply the net proceeds to the Company from the
offering and sale of the Shares to be sold by the Company in the manner
set forth in the Prospectus under "Use of Proceeds."
(l) The Company shall engage and maintain, at its expense, a
registrar and transfer agent for the Shares.
(m) The Company is familiar with the Investment Company Act and the
rules and regulations thereunder, and has in the past conducted its
affairs, and will in the future conduct its affairs, in such a manner so
as to ensure that the Company was not and will not be an "investment
company" within the meaning of the Investment Company Act and the rules
and regulations thereunder.
(n) The Company shall obtain directors' and officers' liability
insurance in the minimum amount of [$___ ] million which shall apply to
the offering contemplated hereby.
(o) The Company shall cause to be prepared and delivered, at its
expense, within one business day from the date hereof, to the Underwriters
an "electronic Prospectus" to be used by the Underwriters in connection
with the offering and sale of the Shares . As used herein, the term
"electronic Prospectus" means a form of Prospectus, and any amendment or
supplement thereto, that meets each of the following conditions: (i) it
shall be encoded in an electronic
19
format, satisfactory to you, that may be transmitted electronically by the
Underwriters to offerees and purchasers of the Shares for at least during
the period when, in the opinion of counsel to the Underwriters, the
Prospectus is required to be delivered under the Act or the Exchange Act;
(ii) it shall disclose the same information as the paper Prospectus and
Prospectus filed pursuant to ▇▇▇▇▇, except to the extent that graphic and
image material cannot be disseminated electronically, in which case such
graphic and image material shall be replaced in the electronic Prospectus
with a fair and accurate narrative description or tabular representation
of such material, as appropriate; and (iii) it shall be in or convertible
into a paper format or an electronic format, satisfactory to you, that
will allow investors to store and have continuously ready access to the
Prospectus at any future time, without charge to investors (other than any
fee charged for subscription to the system as a whole and for on-line
time). The Company hereby confirms that it has included or will include in
the Prospectus filed pursuant to ▇▇▇▇▇ or otherwise with the Commission
and in the Registration Statement at the effective date of the
Registration Statement an undertaking that, upon receipt of a request by
an investor or his or her representative during the period when, in the
opinion of counsel to the Underwriters, delivery of a Prospectus by an
Underwriter or dealer may be required by the Act, the Company shall
transmit or cause to be transmitted promptly, without charge, a paper copy
of the Prospectus.
5. PAYMENT OF EXPENSES.
Whether or not the transactions contemplated by this Agreement are
consummated or this Agreement is terminated, the Company will pay, or reimburse
ING Barings LLC, if paid by the Underwriters, all costs, fees and expenses
incident to the performance of the obligations of the Company under this
Agreement, including but not limited to costs, fees and expenses of or relating
to (i) the preparation by the Company, printing and filing of the Registration
Statement and exhibits to it, each preliminary prospectus, the Prospectus and
any amendment or supplement to the Registration Statement or the Prospectus
(including, without limitation, the fees and expenses of the Company's counsel,
accountants and other advisors), (ii) the preparation and delivery of
certificates representing the Shares, (iii) the printing of this Agreement and
Underwriter's Questionnaires, Underwriter's Powers of Attorney, Blue Sky
Memoranda, Master Agreements Among Underwriters and Master Selling Agreements,
and all other documents relating to the public offering of the Shares (including
those documents supplied to the Underwriters in quantities as hereinabove
stated) and furnishing (including costs of shipping and mailing) such copies of
the Registration Statement, the Prospectus and any preliminary prospectus, and
all exhibits, schedules, consents, certificates of experts, amendments and
supplements thereto, as may be requested for use in connection with the offering
and sale of the Shares by the Underwriters or by dealers to whom Shares may be
sold, (iv) the quotation of the Shares on the New York Stock Exchange, (v) any
filings required to be made with, and the review by, the NASD and the fees,
disbursements and other charges of the Underwriters' counsel in connection
therewith, (vi) the registration or qualification (or obtaining exemptions from
such registration or qualification) of the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions designated pursuant to Section
4(e), including the fees, disbursements and other charges of the Underwriters'
counsel in connection therewith, and the preparation and printing of
preliminary, supplemental and final Blue Sky memoranda, (vii) the issuance,
transfer and delivery of the Shares to the Underwriters, including any issue,
transfer, stamp or other taxes payable thereon, (viii) the transfer agent or
registrar for the Shares, (ix) the costs and expenses of the Underwriters
incident to the preparation and undertaking of "road show" preparations to be
made to prospective investors, and (x) all other fees, costs and expenses
referred to in Part II of the Registration Statement.
6. INDEMNIFICATION.
20
(a) The Company agrees to indemnify and hold harmless each Underwriter,
its directors, officers, employees, and agents and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the Act or Section
20(a) of the Exchange Act, against any and all losses, liabilities, claims,
damages, actions and expenses whatsoever, as incurred (including but not limited
to attorneys' fees and any and all expenses whatsoever incurred in
investigating, preparing, compromising or defending against any litigation,
commenced or threatened, or any claim whatsoever, and any and all amounts paid
in settlement of any claim or litigation), joint or several, to which they or
any of them may become subject under the Act, the Exchange Act or other federal
or state statutory law or regulation, or at common law or otherwise, insofar as
such losses, liabilities, claims, damages or expenses (or actions in respect
thereof) arise out of or are based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement for
the registration of the Shares, as originally filed or any amendment thereof, or
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; or
(ii) upon any untrue statement or alleged untrue statement of a material fact
contained in any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto), or the omission or alleged omission to state therein a
material fact necessary in order to make statements made therein, in the light
of the circumstances under which they were made, not misleading; or (iii) in
whole or in part upon any inaccuracy in the representations and warranties of
the Company contained herein; or (iv) in whole or in part upon any failure of
the Company to perform its obligations hereunder or under law; or (v) any act or
failure to act or any alleged act or failure to act by an Underwriter in
connection with, or relating in any manner to, the Shares or the offering
contemplated hereby, and which is included as part of or referred to in any
loss, claim, damage, liability or action arising out of or based upon any matter
covered by clause (i), (ii), (iii) or (iv) above, provided that the Company will
not be liable under this clause (v) to the extent that a court of competent
jurisdiction shall have determined by a final judgment that such loss, claim,
damage, liability or action resulted directly from any such acts or failures to
act undertaken or omitted to be taken by such Underwriter through its bad faith
or willful misconduct; and PROVIDED, HOWEVER, that the Company will not be
liable in any such case covered by clauses (i), (ii), (iii), (iv) or (v) above
to the extent but only to the extent that any such loss, liability, claim,
damage, action or expense arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information relating to
an Underwriter furnished to the Company by or on behalf of any Underwriter
through you expressly for use therein; and provided, further, that with respect
to any preliminary prospectus, the foregoing indemnity in this Section 6(a)
shall not inure to the benefit of any Underwriter from whom the person asserting
any loss, claim, damage, liability or expense purchased Shares, or any of its
directors, officers or employees or any person controlling such Underwriter, if
copies of the Prospectus were timely delivered to the Underwriter and a copy of
the Prospectus (as then amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) was not sent or given by or on
behalf of such Underwriter to such person, if required by law so to have been
delivered, at or prior to the written confirmation of the sale of the Shares to
such person, and if the Prospectus (as so amended or supplemented) would have
cured the defect giving rise to such loss, claim, damage, liability, action or
expense. The Company acknowledges that the statements
21
set forth in the _____ (including the table), _____, _____ and _______
paragraphs under the captain "Underwriting" in, and in the last paragraph on the
cover page of, the Prospectus constitute the only information furnished in
writing relating to an Underwriter by or on behalf of any Underwriter expressly
for use in the Registration Statement relating to the Shares as originally filed
or in any amendment thereof, any related preliminary prospectus or the
Prospectus or in any amendment thereof or supplement thereto, as the case may
be. This indemnity agreement will be in addition to any liability which the
Company may otherwise have, including under this Agreement.
(b) Each Underwriter severally, and not jointly, agrees to indemnify
and hold harmless the Company, each of the directors of the Company, each of the
officers of the Company who shall have signed the Registration Statement, and
each other person, if any, who controls the Company within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act, against any losses,
liabilities, claims, damages and expenses whatsoever as incurred (including but
not limited to attorneys' fees and any and all expenses whatsoever incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever, and any and all amounts paid in settlement
of any claim or litigation), joint or several, to which they or any of them may
become subject under the Act, the Exchange Act or otherwise, insofar as such
losses, liabilities, claims, damages or expenses (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement for the registration
of the Shares, as originally filed or any amendment thereof, or any related
preliminary prospectus or the Prospectus, or in any amendment thereof 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 any such loss, liability, claim, damage or
expense arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in reliance upon
and in conformity with written information relating to an Underwriter furnished
to the Company by or on behalf of any Underwriter through you expressly for use
therein. This indemnity will be in addition to any liability which any
Underwriter may otherwise have, including under this Agreement.
(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 an indemnifying party
under such subsection, notify each party against whom indemnification is to be
sought in writing of the commencement thereof (but the failure so to notify an
indemnifying party shall not relieve it from any liability or obligation which
it may have under this Section 6 or otherwise (i) unless the failure to notify
shall result in the forfeiture by the indemnifying party of substantial rights
and defenses and (ii) will not in any event relieve the indemnifying party from
any obligations other than the indemnification obligation provided in paragraph
(a) or (b) above). In case any such action is brought against any indemnified
party, and it notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein, and to the extent it
may elect by written notice delivered to the indemnified parties promptly after
receiving the aforesaid notice from an indemnified party, to assume the defense
thereof with counsel reasonably satisfactory to such
22
indemnified parties. Notwithstanding the foregoing, the indemnified party or
parties shall have the right to employ its or their own separate counsel in any
such action and to participate in the defense thereof, but the fees and expenses
of such counsel shall be at the expense of such indemnified party or parties
unless (i) the employment of such counsel shall have been authorized in writing
by the indemnifying party in connection with the defense of such action, (ii)
the indemnifying parties shall not have employed counsel to have charge of the
defense of such action within a reasonable time after notice of commencement of
the action, or (iii) such indemnified party or parties shall have reasonably
concluded that a conflict may arise between the positions of the indemnifying
party or parties in conducting the defense of any such action or that there may
be one or more legal defenses available to it or them which are different from
or additional to those available to one or all of the indemnifying parties (in
which case the indemnifying party or parties shall not have the right to direct
the defense of such action on behalf of the indemnified party or parties), in
any of which events such fees and expenses shall be borne by the indemnifying
parties, it being understood, however, that the indemnifying party or parties
shall not, in connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the fees and expenses of
more than one separate firm of attorneys (plus separate local counsel, if
retained by the indemnified party or parties) at any time for all such
indemnified parties. An indemnifying party shall not be liable for any
settlement of any claim or action effected without its written consent;
PROVIDED, HOWEVER, that such consent was not unreasonably withheld. The
indemnifying party agrees that it shall be liable for any settlement (including
all of the indemnified party's reasonable costs, including fees and expenses of
its counsel) of any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by such indemnifying
party of the aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to the
date of such settlement. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement, compromise or consent
to the entry of judgment in any pending or threatened action, suit or proceeding
in respect of which any indemnified party is or could have been a party and
indemnity was or could have been sought hereunder by such indemnified party,
unless such settlement, compromise or consent is for money damages only and
includes (i) an unconditional release of such indemnified party from all
liability on claims that are the subject matter of such action, suit or
proceeding 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.
Any losses, claims, damages, liabilities, expenses or actions for which
an indemnified party is entitled to indemnification or contribution under this
Section 6 or under Section 7 below shall be paid by the indemnifying party to
the indemnified party as such losses, claims, damages, liabilities or expenses
are incurred, but in all cases, no later than thirty (30) days of invoice to the
indemnifying party.
The parties to this Agreement hereby acknowledge that they are
sophisticated business persons who were represented by counsel during the
negotiations regarding the provisions hereof including, without limitation, the
provisions of this Section 6 and Section 7 below and are fully informed
regarding said provisions. They further acknowledge that the
23
provisions of this Section 6 and Section 7 below fairly allocate the risks in
light of the ability of the parties to investigate the Company and its business
in order to assure that adequate disclosure is made in the Registration
Statement, the preliminary prospectus and Prospectus as required by the Act and
the Exchange Act.
7. CONTRIBUTION. In order to provide for contribution in circumstances in
which the indemnification provided for in Section 6 hereof is for any reason
held to be unavailable from any indemnifying party or is insufficient to hold
harmless a party indemnified thereunder, each indemnifying party shall severally
contribute to the aggregate losses, claims, damages, liabilities and expenses of
the nature contemplated by such indemnification provision (including any
investigation, legal and other expenses incurred in connection with, and any
amount paid in settlement of, any action, suit or proceeding or any claims
asserted, but after deducting in the case of losses, claims, damages,
liabilities and expenses suffered by the Company any contribution received by
the Company from persons, other than the Underwriters, who may also be liable
for contribution, including persons who control the Company within the meaning
of Section 15 of the Act or Section 20(a) of the Exchange Act, officers of the
Company who signed the Registration Statement and directors of the Company) as
incurred to which the Company and one or more of the Underwriters may be
subject, in such proportions as is appropriate to reflect the relative benefits
received by the Company and the Underwriters from the offering of the Shares or,
if such allocation is not permitted by applicable law or indemnification is not
available as a result of the indemnifying party not having received notice as
provided in Section 6 hereof, in such proportion as is appropriate to reflect
not only the relative benefits referred to above but also the relative fault of
the Company on the one hand and the Underwriters, severally on the other, in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters, severally, on the other shall be deemed to be in
the same proportion as the total proceeds from the offering of the Shares (net
of underwriting discounts and commissions but before deducting expenses)
received by the Company bears to the underwriting discounts and commissions
received by the Underwriters respectively. The relative fault of the Company on
the one hand and of the Underwriters, severally, on the other 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 or the
Underwriters 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
contribution pursuant to this Section 7 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. Notwithstanding the provisions of this Section
7, (i) in no case shall any Underwriter be liable or responsible for any amount
in excess of the underwriting discounts and commissions applicable to the Shares
purchased by such Underwriter hereunder, and (ii) 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. Further notwithstanding the provisions of this Section 7 and
the preceding sentence, no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which
24
the Shares underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages that such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. For purposes of this Section 7, each director,
officer, employee and agent of an Underwriter and each person, if any, who
controls an Underwriter within the meaning of Section 15 of the Act or Section
20(a) of the Exchange Act shall have the same rights to contribution as such
Underwriter, and each person, if any, who controls the Company within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange Act, each
officer of the Company who shall have signed the Registration Statement and each
director of the Company shall have the same rights to contribution as the
Company, subject in each case to clauses (i) and (ii) of this Section 7. Any
party entitled to contribution will, promptly after receipt of notice of
commencement of any action, suit or proceeding against such party in respect of
which a claim for contribution may be made against another party or parties,
notify each party or parties from whom contribution may be sought, but the
omission to so notify such party or parties shall not relieve the party or
parties from whom contribution may be sought from any obligation it or they may
have under this Section 7 or otherwise. No party shall be liable for
contribution with respect to any action or claim settled without its consent,
provided that such consent was not unreasonably withheld.
The Underwriters' obligations in this Section 7 to contribute are several
in proportion to their respective underwriting obligations and not joint. The
remedies provided for in this Section 7 are not exclusive and shall not limit
any rights or remedies which may otherwise be available to any indemnified party
at law or in equity.
8. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITERS. The several
obligations of the Underwriters to purchase and pay for the Firm Shares and the
Option Shares, as provided herein, shall be subject to the accuracy of the
representations and warranties on the part of the Company contained herein as of
the date hereof, the Closing Date and any Additional Closing Date, to the
absence from any certificates, opinions, written statements or letters furnished
to you or to Underwriters' counsel pursuant to this Section 8 of any
misstatement or omission, to the timely performance by the Company of its
covenants and other obligations hereunder and to each of the following
additional conditions:
(a) The Registration Statement shall have become effective not later
than, if pricing pursuant to Rule 430A, 5:30 P.M., New York time on the date of
this Agreement, and if pricing pursuant to a pricing amendment, 12:00 P.M., New
York time on the date an amendment to the Registration Statement containing the
public offering price has been filed with the Commission, or at such later time
and date as shall have been consented to in writing by ING Barings LLC; if the
Company shall have elected to rely upon Rule 430A or Rule 434 of the
Regulations, the Prospectus shall have been filed with the Commission in a
timely fashion in accordance with Section 4(a) hereof; and, at or prior to the
Closing Date no stop order suspending the effectiveness of the Registration
Statement or any post-effective amendment thereof shall have been issued and no
proceedings for such purpose shall have been initiated or threatened by the
Commission; no order suspending the qualification or registration of the Shares
under the securities or Blue Sky laws of any jurisdiction shall be in effect and
no proceeding for such purpose shall be pending before or threatened or
contemplated by the authorities of any
25
such jurisdiction; any request for additional information on the part of the
staff of the Commission or any such authorities shall have been complied with to
the satisfaction of the staff of the Commission or such authorities and to the
satisfaction of counsel to the Underwriters; after the date hereof no amendment
or supplement to the Registration Statement or the Prospectus shall have been
filed unless a copy thereof was first submitted to you and you did not
reasonably object thereto; and the NASD, upon review of the terms of the public
offering of the Shares, shall not have raised any objection to the fairness or
reasonableness of the underwriting terms and arrangements.
(b) (omitted)
(c) (omitted)
(d) All corporate proceedings and other legal matters in connection
with this Agreement, the form of Registration Statement, preliminary prospectus
or Prospectus, and the registration, authorization, issue, sale and delivery of
the Shares as herein contemplated shall be satisfactory in form and substance to
you and to Underwriters' counsel in your and your counsel's reasonable
discretion. The Underwriters shall have received from Stroock & Stroock & ▇▇▇▇▇
LLP, Underwriters' counsel, a favorable opinion, dated the Closing Date (and the
Additional Closing Date, if applicable), with respect to the issuance and sale
of the Shares, the Registration Statement, the Prospectus and other related
matters as you may reasonably require, and the Company, and the Subsidiaries
shall have furnished to Underwriters' counsel such documents as they reasonably
request for the purpose of enabling them to pass upon the matters referred to in
this Section.
(e) At the Closing Date (and the Additional Closing Date, if
applicable) you shall have received a certificate of the Chief Executive Officer
and Chief Financial Officer of the Company, dated the Closing Date (and the
Additional Closing Date, if applicable), to the effect that (i) the condition
set forth in subsection (a) of this Section 8 has been satisfied, (ii) as of the
date hereof and as of the Closing Date (and the Additional Closing Date, if
applicable) all the representations and warranties of the Company set forth in
this Agreement are accurate with the
26
same force and effect as if made on each of such dates, (iii) as of the Closing
Date (and the Additional Closing Date, if applicable) the agreements and
obligations of the Company to be performed hereunder on or prior thereto have
been duly performed, (iv) when the Registration Statement became effective and
at all times subsequent thereto up to the delivery of such certificate, the
Registration Statement and the Prospectus, and any amendments or supplements
thereto, contained the information required to be included therein by the Act
and the applicable rules and regulations of the Commission thereunder, and
conformed to the requirements of the Act and the applicable rules and
regulations of the Commission thereunder; the Registration Statement and the
Prospectus, and any amendments or supplements thereto, did not and do not
include any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading; and since the effective date of the Registration Statement, there
has occurred no event required to be set forth in an amended or supplemented
Prospectus which has not been so set forth; and (v) subsequent to the respective
dates as of which information is given in the Registration Statement and the
Prospectus, the Company and the Subsidiaries have not sustained any material
loss or interference with their respective business or properties from fire,
flood, hurricane, accident or other calamity, whether or not covered by
insurance, or from any labor dispute or any legal or governmental proceeding,
and there has not been any material adverse change, or any development involving
a prospective material adverse change, in the business, management, properties,
operations, prospects, condition (financial or otherwise), or results of
operations of the Company and the Subsidiaries taken as a whole, or any
transaction that is material to the Company and the Subsidiaries taken as a
whole, except transactions entered into in the ordinary course of business, or
any obligation, direct or contingent, that is material to the Company and the
Subsidiaries, taken as a whole, incurred by the Company or the Subsidiaries,
except obligations incurred in the ordinary course of business, or any change in
the capital stock or outstanding indebtedness of the Company or any of the
Subsidiaries that is material to the Company and the Subsidiaries, taken as a
whole, or any dividend or distribution of any kind declared, paid or made on the
capital stock of the Company or any of the Subsidiaries.
(e) At the time that this Agreement is executed by the Company the
Underwriters shall have received from each of Ernst & Young LLP and Deloitte &
Touche LLP a letter as of the date this Agreement is executed by the Company in
form and substance satisfactory to you (the "Original Letters"), and on the
Closing Date (and the Additional Closing Date, if any) the Underwriters shall
have received from each of such firms a letter dated the Closing Date (or the
Additional Closing Date, as the case may be) stating that, as of a specified
date not earlier than five (5) days prior to the Closing Date or the Additional
Closing Date, as the case may be, nothing has come to its attention to suggest
that the statements made in its Original Letter are not true and correct.
In addition, ING Barings LLC shall have received from Deloitte & Touche
LLP a letter addressed to the Company and made available to you for the use of
the Underwriters stating that their review of the Company's system of internal
accounting controls, to the extent they deemed necessary in establishing the
scope of their examination of the Company's consolidated financial statements as
of December 31, 1999, did not disclose any weaknesses in internal controls that
they considered to be substantial or material weaknesses.
27
In the event that the letters to be delivered referred to above set forth
note any changes, decreases or increases in the financial information included
in the Registration Statement and the Prospectus, it shall be a further
condition to the obligations of the Underwriters hereunder that ING Barings LLC
shall have determined in its sole judgment, that such changes, decreases or
increases as are set forth in such letters do not reflect a material adverse
change in the stockholders' equity or long-term debt of the Company as compared
with the amounts shown in the latest balance sheet of the Company included in
the Prospectus, or a material adverse change in total net revenues or net income
of the Company, in each case as compared with the corresponding period of the
prior year.
(g) Subsequent to the date this Agreement is executed or, if earlier,
the dates as of which information is given in the Registration Statement
(exclusive of any amendment thereof) and the Prospectus (exclusive of any
supplement thereto), there shall not have been (i) any change or decrease
specified in the letter or letters referred to in paragraph (f) of this Section
8 or (ii) any change, or any development involving a prospective change, in or
affecting the condition (financial or other), earnings, business or properties
of the Company and the Subsidiaries, whether or not arising in the ordinary
course of business, the effect of which, in any case referred to in clause (i)
or (ii) above, is, in ING Barings LLC's sole judgment, material and adverse and
that makes it impracticable or inadvisable to proceed with the offering or
delivery of the Shares as contemplated by the Registration Statement (exclusive
of any amendment thereof) and the Prospectus (exclusive of any supplement
thereto).
(h) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, (i) there shall not have been a
material adverse change, or any development involving a prospective material
adverse change, in the general affairs, business, prospects, properties,
management, key personnel, condition (financial or other) or results of
operations of the Company and the Subsidiaries, whether or not arising from
transactions in the ordinary course of business, in each case other than as set
forth in the Registration Statement and the Prospectus (or, in the case of a
prospective change, other than as contemplated by the Registration Statement and
the Prospectus), and (ii) the Company shall not have sustained any material loss
or interference with its business or properties from fire, explosion, flood,
hurricane or other casualty or calamity, whether or not covered by insurance, or
from any labor dispute or any court or legislative or other governmental action,
order or decree, which is not set forth in the Registration Statement and the
Prospectus, if in your reasonable judgment any such development makes it
impracticable or inadvisable to consummate the sale and delivery of the Shares
at the public offering price.
(i) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there shall have been no litigation
or other proceeding instituted against the Company or any of its officers or
directors in their capacities as such, before or by any federal, state, or local
court, commission, regulatory body, administrative agency or other governmental
body, domestic or foreign, in which litigation or proceeding an unfavorable
ruling, decision or finding could reasonably be expected to have a Material
Adverse Effect on the Company and its subsidiaries taken as a whole.
28
(j) At the time of execution of this Agreement, the Company shall
have furnished to you a letter addressed to you from each officer and director
of the Company and each shareholder or other person heretofore designated by
you, in which each such person agrees not to (1) offer for sale, contract to
sell, sell, pledge or otherwise dispose of (or enter into any transaction or
device which is designed to, or could be expected to, result in the disposition
by any person at any time in the future of) any shares of Common Stock or
securities convertible into, exercisable or exchangeable for, or represent the
right to receive, Common Stock or sell or grant options, rights or warrants with
respect to any shares of Common Stock or register for sale any outstanding
shares of Common Stock; or (2) enter into any swap or other derivatives
transaction that transfers to another, in whole or in part, any of the economic
benefits or risks of ownership of such shares of Common Stock or securities,
whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or other securities, in cash or otherwise
for a period of 180 days following the time of execution of this Agreement
without your prior written consent, other than shares of Common Stock disposed
of as gifts or transfers to immediate family members or trusts or partnerships,
the beneficiaries and sole partners of which are immediate family members,
provided that the donee or transferee agrees in writing to be bound in the same
manner.
(k) The Shares shall be qualified for sale in such jurisdictions as you
shall have requested subject to the terms hereof, each such qualification shall
be in effect and not subject to any stop order or other proceeding on the
Closing Date and the Additional Closing Date, if applicable.
(l) The Shares shall have been listed on the New York Stock Exchange,
subject to official notice of issuance.
(m) You shall not have advised the Company that the Registration
Statement, the preliminary prospectus or the Prospectus, or any amendment or any
supplement thereto, contains an untrue statement of fact which, in your
judgment, is material, or omits to state a fact which, in your judgment, is
material and is required to be stated therein or necessary to make the
statements therein not misleading and the Company shall not have cured such
untrue statement of fact or omission of such statement of fact.
(n) The Company shall have furnished to you such certificates, in
addition to those specifically mentioned herein, as you may have reasonably
requested (i) as to the accuracy and completeness (to the extent required under
applicable law) at the Closing Date and the Additional Closing Date, if
applicable, of any statement in the Registration Statement, the preliminary
prospectus or the Prospectus, (ii) as to the accuracy at the Closing Date and
the Additional Closing Date, if applicable, of the representations, warranties
and covenants of the Company herein, (iii) as to the performance by the Company
of its obligations hereunder, or (iv) as to the fulfillment of the conditions
concurrent and precedent to your obligations hereunder.
29
(o) Prior to the Closing Date and the Additional Closing Date, if
applicable, the Company shall have furnished to the Underwriters such further
information and documents as you may reasonably request.
If any of the conditions specified in this Section shall not have been
fulfilled in all respects when and as required to be satisfied, or if any of the
opinions and certificates mentioned above or elsewhere in this Agreement shall
not be reasonably satisfactory in form and substance to you and counsel for the
Underwriters, this Agreement and all obligations of the Underwriters hereunder
may be terminated at, or at any time on or prior to, the Closing Date (and
Additional Closing Date, if applicable) by ING Barings LLC. Notice of such
termination shall be given to the Company promptly in writing or by telephone
confirmed in writing.
9. DEFAULT BY AN UNDERWRITER.
(a) If any Underwriter or Underwriters shall default in its or their
obligations to purchase Firm Shares or Option Shares hereunder, and if the Firm
Shares or Option Shares with respect to which such default relates do not (after
giving effect to arrangements, if any, made by you pursuant to subsection (b)
below) exceed in the aggregate 10% of the number of Firm Shares or Option
Shares, the Shares to which the default relates shall be purchased by the
non-defaulting Underwriters in proportion to the respective proportions which
the numbers of Firm Shares set forth opposite their respective names in Schedule
I hereto bear to the aggregate number of Firm Shares set forth opposite the
names of the non-defaulting Underwriters.
(b) In the event that such default relates to more than 10% of the Firm
Shares or Option Shares, as the case may be, you may in your discretion arrange
for yourself or for another party or parties (including any non-defaulting
Underwriter or Underwriters who so agree) to purchase such Firm Shares or Option
Shares, as the case may be, to which such default relates on the terms contained
herein. In the event that within 5 calendar days after such a default you do not
arrange for the purchase of the Firm Shares or Option Shares, as the case may
be, to which such default relates as provided in this Section 9, this Agreement
or, in the case of a default with respect to the Option Shares, the obligations
of the Underwriters to purchase and of the Company to sell the Option Shares
shall thereupon terminate, without liability on the part of the Company with
respect thereto (except in each case as provided in Section 5, 6(a) and 7
hereof), or the Underwriters, but nothing in this Agreement shall relieve a
defaulting Underwriter or Underwriters of its or their liability, if any, to the
other Underwriters and the Company for damages occasioned by its or their
default hereunder. Notwithstanding the foregoing, if any default occurs with
respect to the Additional Closing, this Agreement will not terminate with
respect to the Firm Shares purchased prior to such time.
(c) In the event that the Firm Shares or Option Shares to which the
default relates are to be purchased by the non-defaulting Underwriters, or are
to be purchased by another party or parties as aforesaid, you or the Company
shall have the right to postpone the Closing Date or Additional Closing Date, as
the case may be, for a period not exceeding five business days, in order to
effect whatever changes may thereby be made necessary in the Registration
30
Statement or the Prospectus or in any other documents and arrangements, and the
Company agrees to file promptly any amendment or supplement to the Registration
Statement or the Prospectus which, in the opinion of Underwriters' counsel, may
thereby be made necessary or advisable. The term "Underwriter" as used in this
Agreement shall include any party substituted under this Section 9 with like
effect as if it had originally been a party to this Agreement with respect to
such Firm Shares and Option Shares.
10. SURVIVAL OF REPRESENTATIONS AND AGREEMENTS. All representations and
warranties, covenants and agreements of the Underwriters and the Company
contained in this Agreement, including the agreements contained in Section 4 and
Section 5, the indemnity agreements contained in Section 6 and the contribution
agreements contained in Section 7, shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of any Underwriter
or any controlling person thereof or by or on behalf of the Company, any of its
officers, directors or employees or any controlling person thereof, and shall
survive delivery and acceptance of, and payment for the Shares to and by the
Underwriters. The representations contained in Sections 1 and the agreements
contained in Sections 5, 6 and 7 and 11(d) hereof also shall survive the
termination of this Agreement, including termination pursuant to Section 9 or 11
hereof. A successor to any Underwriter, or to the Company, shall be entitled to
the benefits of the indemnity, contribution and reimbursement agreements
contained in Section 6 and Section 7 hereof.
11. EFFECTIVE DATE OF AGREEMENT; TERMINATION.
(a) This Agreement shall become effective upon the later of when (i)
you and the Company shall have received notification of the effectiveness of the
Registration Statement or (ii) the execution of this Agreement. If either the
public offering price or the purchase price per Share has not been agreed upon
prior to 5:00 P.M., New York time, on the fifth full business day after the
Registration Statement shall have become effective, this Agreement shall
thereupon terminate without liability to the Company or the Underwriters except
as herein expressly provided. Until this Agreement becomes effective as
aforesaid, it may be terminated by the Company by notifying you or by you by
notifying the Company. Notwithstanding the foregoing, the provisions of this
Section 11 and of Sections 1, 5, 6 and 7 hereof shall at all times be in full
force and effect.
(b) ING Barings LLC shall have the right to terminate this Agreement at
any time on or prior to the Closing Date, or the obligations of the Underwriters
to purchase the Option Shares at any time on or prior to the Additional Closing
Date, as the case may be (but in any event prior to delivery of and payment for
the Shares), if (A) any domestic or international event or act or occurrence has
materially disrupted, or in your opinion will in the immediate future materially
disrupt, the market for the Company's securities or securities in general; or
(B) if trading on the New York or American Stock Exchanges or ▇▇▇▇▇▇
▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ shall have been suspended, or limited, minimum or maximum prices
for trading shall have been fixed, or maximum ranges for prices for securities
shall have been required, on the New York Stock Exchange or the Nasdaq National
Market by the New York Stock Exchange or the Nasdaq National Market or by order
of the Commission or any other governmental authority having jurisdiction; or
(C) if a banking moratorium has been declared by a state or federal authority or
if any new restriction materially adversely affecting the distribution of the
Firm Shares or the Option Shares, as the case may be, shall have become
effective; or (D)(i) there shall have occurred any outbreak or escalation of
hostilities or there is an outbreak or escalation of national or international
hostilities or there is a declaration by the United States of a national
emergency or war or (ii) if there has been any crisis or calamity or any change
or development in United States' or international political, financial or
economic conditions, if the effect of any such event in (D)(i) or (D)(ii), in
the sole judgment of ING Barings LLC makes it impracticable or inadvisable to
proceed with the offering, sale and delivery of the Firm Shares or the Option
Shares, as the case may be, on the terms contemplated by the Prospectus
(exclusive of any supplement thereto) or to enforce contracts for the sale of
securities; or (E) in the sole judgment of ING Barings LLC there shall have
occurred any Material Adverse Effect on the Company and its Subsidiaries taken
as a whole or (F) the Company shall have sustained a loss by strike, fire,
flood, earthquake, accident or other calamity of such character as in the sole
judgment of ING Barings LLC may interfere materially with the conduct of the
business and operations of the Company regardless of whether or not such loss
shall have been insured. Any termination pursuant to this Section shall be
without liability on the part of (a) the Company to any Underwriter, except that
the Company shall be obligated to reimburse the expenses of ING Barings LLC and
the underwriters to the extent required pursuant to Sections 5, 6 and 7 hereof,
(b) any Underwriter to the Company, (c) of any party hereto to any other party
except that the provisions of Sections 5, 6 and 7 shall at all times be
effective and shall survive such termination.
(c) Any notice of termination pursuant to this Section 11 shall be by
telephone or facsimile and confirmed in writing by letter.
(d) If this Agreement shall be terminated pursuant to any of the
provisions hereof (otherwise than pursuant to (i) notification by you as
provided in Section 11(a) hereof or (ii) Section 9(b) or 11(b) hereof), or if
the sale of the Shares provided for herein is not consummated because any
condition to the obligations of the Underwriters set forth herein is not
satisfied or because of any refusal, inability or failure on the part of the
Company to perform any agreement herein or comply with any provision hereof, the
Company will, subject to demand by you, reimburse the Underwriters for all
out-of-pocket expenses (including but not limited to the fees and expenses of
their counsel), incurred by the Underwriters in connection herewith.
12. NOTICES. Any notice or notification in any form to be given hereunder
shall be in writing and shall be delivered in person or sent by telephone or
facsimile transmission (but in the case of a notification by telephone, with
subsequent confirmation by letter or facsimile transmission).
Any notice or notification to you shall be addressed to:
ING Barings LLC
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: _______________
32
With a copy to:
Stroock & Stroock & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Any notice or notification to the Company shall be addressed to the
Company at:
General Maritime Corporation
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
With a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Any notice or notification shall (subject to confirmation when
required) take effect at the time of receipt.
13. PARTIES. This Agreement shall inure solely to the benefit of, and
shall be binding upon, the Underwriters, the Company and the controlling
persons, directors, officers, employees and agents referred to in Section 6 and
7, and their respective successors and assigns, and no other person shall have
or be construed to have any legal or equitable right, remedy or claim under or
in respect of or by virtue of this Agreement or any provision herein contained.
The term "successors and assigns" shall not include a purchaser, in its capacity
as such, of Shares from any of the Underwriters. Notwithstanding the foregoing,
this Agreement and the terms and provisions hereof are, unless otherwise
specified herein, for the sole benefit of only those persons, except that (a)
the representations, warranties, indemnities and agreements of the Company
contained in this Agreement shall also be deemed to be for the benefit of each
purchaser indemnified party and (b) the indemnity agreement of the Underwriters
contained in Section 6 hereof shall be deemed to be for the benefit of each
company indemnified party.
14. CONSENT TO JURISDICTION. Any legal suit, action or proceeding arising
out of or based upon this Agreement or the transactions contemplated hereby
("Related Proceedings") may be instituted in the federal courts of the United
States of America located in the City and County of New York or the courts of
the State of New York in each case located in the City and County of New York
(collectively, the "Specified Courts"), and each party irrevocably submits to
the exclusive jurisdiction (except for proceedings instituted in regard to the
enforcement of a
33
judgment of any such court (a "Related Judgment"), as to which such jurisdiction
is non-exclusive) of such courts in any such suit, action or proceeding. Service
of any process, summons, notice or document by mail to such party's address set
forth above shall be effective service of process for any suit, action or other
proceeding brought in any such court. The parties irrevocably and
unconditionally waive any objection to the laying of venue of any suit, action
or other proceeding in the Specified Courts and irrevocably and unconditionally
waive and agree not to plead or claim in any such court that any such suit,
action or other proceeding brought in any such court has been brought in an
inconvenient forum. Each party not located in the United States irrevocably
appoints [ ], which currently maintains an office at New York, New York, United
States of America, as its agent to receive service of process or other legal
summons for purposes of any such suit, action or proceeding that may be
instituted in any state or federal court in the City and County of New York.
With respect to any Related Proceeding, each party irrevocably waives, to
the fullest extent permitted by applicable law, all immunity (whether on the
basis of sovereignty or otherwise) from jurisdiction, service of process,
attachment (both before and after judgment) and execution to which it might
otherwise be entitled in the Specified Courts or any other court of competent
jurisdiction, and will not raise or claim or cause to be pleaded any such
immunity at or in respect of any such Related Proceeding or Related Judgment,
including, without limitation, any immunity pursuant to the United States
Foreign Sovereign Immunities Act of 1976, as amended.
15. MISCELLANEOUS. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York applicable to
contracts made and to be wholly performed within the State of New York. This
Agreement may be executed in one or more counterparts, and if executed in more
than one counterpart, the executed counterparts shall together constitute a
single instrument. The descriptive headings in this Agreement are for
convenience of reference only and shall not define or limit the provisions
hereof.
Time shall be of the essence of this Agreement.
This Agreement constitutes the entire agreement of the parties to this
Agreement and supersedes all prior written or oral and all contemporaneous oral
agreements, understandings and negotiations with respect to the subject matter
hereof.
If any provision or portion of any provision of the Agreement, or the
application of any such provision or any portion thereof to any party or
circumstances, shall be held invalid or unenforceable, the remaining portion of
such provision and the remaining portion of such provision and the remaining
provisions of this agreement, and the application of such provision or portion
of such provision as is held invalid or unenforceable to any parties or
circumstances other than those as to which it is held invalid or unenforceable,
shall not be affected thereby and such remaining portion of such provision and
the remaining provisions of this Agreement shall continue to be valid and in
full force and effect.
34
If the foregoing is in accordance with the Underwriters' understanding of
our agreement, kindly sign and return to us one of the counterparts hereof,
whereupon it will become a binding agreement between the Company and the
Underwriters in accordance with its terms.
35
This Agreement may be signed in counterparts which together shall
constitute one and the same instrument.
Very truly yours,
General Maritime Corporation
By:
-----------------------------------
Name:
Title:
36
The foregoing Underwriting Agreement is hereby confirmed and accepted as
of the date first above written.
ING BARINGS LLC
By: ING Barings LLC
Acting on its own behalf and as
one of the Representatives
of the several Underwriters
referred to in the foregoing Agreement
By:
----------------------------
Title:
-------------------------
▇▇▇▇▇▇ Brothers Inc.
By: ▇▇▇▇▇▇ Brothers, Inc.
Acting on its own behalf and as
one of the Representatives
of the several Underwriters
referred to in the foregoing Agreement
By:
----------------------------
Title:
-------------------------
▇▇▇▇▇▇▇▇▇ & Company, Inc.
By: ▇▇▇▇▇▇▇▇▇ & Company, Inc.
Acting on its own behalf and as
one of the Representatives
of the several Underwriters
referred to in the foregoing Agreement
By:
----------------------------
Title:
-------------------------
37
SCHEDULES
I - Underwriters
EXHIBITS
A - Form of Lock-Up Agreement
38
SCHEDULE I
UNDERWRITERS
Underwriting Agreement dated ____________, 2000
Number of Firm
Shares to be
Purchased from
the Company
-----------
NAME
ING Barings LLC............
▇▇▇▇▇▇ Brothers Inc........
▇▇▇▇▇▇▇▇▇ & Company, Inc.
Total......................
B-1
Exhibit A
Form of Lock-Up Agreement
ING Barings LLC
▇▇▇▇▇▇ Brothers Inc.
▇▇▇▇▇▇▇▇▇ & Company, Inc.
c/o ING Barings LLC
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: General Maritime Corporation
Dear Sirs:
The undersigned is the record owner of shares of common stock, par value
$.01 per share, and/or warrants or options to purchase shares of common stock
and/or shares of preferred stock, par value $.01 per share (such shares of
common stock, warrants and options herein referred to as the "Securities"), of
General Maritime Corporation, a ▇▇▇▇▇▇▇▇ Islands corporation (the "Company").
The undersigned understands that the Company has filed with the Securities and
Exchange Commission a Registration Statement on Form S-1 (the "Registration
Statement"), for the registration of the Company's common stock, which will be
underwritten by a group of underwriters (the "Underwriters") for whom ING
Barings LLC will act as representative.
The undersigned agrees that the undersigned will not, without the prior
consent of ING Barings LLC, directly or indirectly for a period of 180 days from
the date the Registration Statement has been declared effective: (1) offer for
sale, contract to sell, sell, pledge or otherwise dispose of (or enter into any
transaction or device which is designed to, or could be expected to, result in
the disposition by any person at any time in the future of) any Securities or
securities convertible into, exercisable or exchangeable for, or representing
the right to receive, Securities or sell or grant options, rights or warrants
with respect to any Securities or register for sale any outstanding Securities;
or (2) enter into any swap or other derivatives transaction that transfers to
another, in whole or in part, any of the economic benefits or risks of ownership
of such Securities or securities, whether any such transaction described in
clause (1) or (2) above is to be settled by delivery of Securities or other
securities, in cash or otherwise.
Notwithstanding the foregoing, (i) gifts or (ii) transfers to (A) the
undersigned's immediate family or (B) a trust or partnership the beneficiaries
and sole partners of which are members of the undersigned's immediate family
and/or the undersigned, shall not be prohibited
B-2
by this agreement if the donee or transferee agrees in writing to be bound by
the foregoing in the same manner as it applies to the undersigned. "Immediate
family" shall mean spouse, lineal descendants, father, mother, brother or sister
to the transferor. In addition, notwithstanding the foregoing, if the
undersigned is a corporation or other entity, the corporation or other entity
may transfer Securities to (i) any direct or indirect majority-owned subsidiary
of such corporation or entity or (ii) any affiliate of such corporation or
entity. This agreement shall not prohibit the exercise of any stock options, or
rights relating to the conversion of convertible debt, except that the
Securities obtained upon any such exercise shall be subject to the limitations
on disposition herein.
Very truly yours,
By:
--------------------------------------- -------------------------------
Legal name of Stockholder as it appears Name:
on the Corporate Records Title:
B-3
