1
EXHIBIT 1.1
DEUTSCHE ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ INC.
EQUITY CAPITAL MARKETS
DATED _________, 1998
▇▇▇▇▇▇▇▇.▇▇▇ CORPORATION
5,000,000 SHARES
COMMON STOCK
--------------------------------------------------------------------------------
UNDERWRITING
AGREEMENT
--------------------------------------------------------------------------------
2
SUBJECT TO NEGOTIATION.
▇▇▇▇▇▇▇▇.▇▇▇ CORPORATION
5,000,000 SHARES
PLUS AN OPTION TO PURCHASE FROM ▇▇▇▇▇▇▇▇.▇▇▇ CORPORATION
UP TO 750,000 ADDITIONAL SHARES TO COVER OVER-ALLOTMENTS
COMMON STOCK
UNDERWRITING AGREEMENT
____________, 1998
DEUTSCHE ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ INC.
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ SECURITIES CORPORATION
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇. ▇. ▇▇▇▇▇▇▇▇▇, TOWBIN
As Representatives of the several Underwriters
c/o Deutsche ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
▇▇▇▇▇▇▇▇.▇▇▇ Corporation, a Delaware corporation (the "Company"),
hereby confirms its agreement with the several underwriters named in Schedule 1
hereto (the "Underwriters"), for whom you have been duly authorized to act as
representatives (the one or more firms acting in such capacities, the
"Representatives"), as set forth below. If you are the only Underwriters, all
references herein to the Representatives shall be deemed to be references to the
Underwriters.
Section 1. Underwriting. Subject to the terms and conditions contained herein:
(a) The Company proposes to issue and sell 5,000,000 shares of common
stock, par value $0.001 per share (the "Common Stock"), of the Company ("the
Firm Shares") to the several Underwriters. The Company also proposes to issue
and sell to the several Underwriters not more than 750,000 additional shares of
Common Stock (the "Option Shares" and, together with the Firm Shares, the
"Shares") if requested by the Representatives as provided in Section 2(b)
hereof.
3
(b) Upon your authorization of the release of the Firm Shares, the
Underwriters propose to make a public offering (the "Offering") of the Firm
Shares upon the terms set forth in the Prospectus (as defined below) as soon
after the Registration Statement (as defined below) and this Agreement have
become effective as in the Representatives' sole judgment is advisable. As used
in this Agreement, the term "Original Registration Statement" means the
registration statement (File No. 333-51121) initially filed with the Securities
and Exchange Commission (the "Commission") relating to the Shares, as amended at
the time when it was or is declared effective, including all financial schedules
and exhibits thereto and including any information omitted therefrom pursuant to
Rule 430A under the Securities Act of 1933, as amended (the "Securities Act"),
and included in the Prospectus; the term "Rule 462(b) Registration Statement"
means any registration statement filed with the Commission pursuant to Rule
462(b) under the Securities Act (including the Registration Statement and any
Preliminary Prospectus (as defined below) or Prospectus incorporated therein at
the time such Registration Statement becomes effective); the term "Registration
Statement" includes both the Original Registration Statement and any Rule 462(b)
Registration Statement; the term "Preliminary Prospectus" means each prospectus
subject to completion filed with the Original Registration Statement or any
amendment thereto (including the prospectus subject to completion, if any,
included in the Original Registration Statement or any amendment thereto at the
time it was or is declared effective); the term "Prospectus" means:
(i) if the Company relies on Rule 434 under the Securities Act, the
Term Sheet (as defined below) relating to the Shares that is first
filed pursuant to Rule 424(b)(7) under the Securities Act, together
with the Preliminary Prospectus identified therein that such Term
Sheet supplements;
(ii) if the Company does not rely on Rule 434 under the Securities
Act, the prospectus first filed with the Commission pursuant to Rule
424(b) under the Securities Act;
(iii) if the Company does not rely on Rule 434 under the Securities
Act and if no prospectus is required to be filed pursuant to Rule
424(b) under the Securities Act, the prospectus included in the
Registration Statement; or
(iv) for purposes of the representations and warranties in Section 5
hereof, if the prospectus is not in existence, the most recent
Preliminary Prospectus;
and the term "Term Sheet" means any term sheet that satisfies the requirements
of Rule 434 under the Securities Act. Any reference herein to the "date" of a
Prospectus that includes a Term Sheet shall mean the date of such Term Sheet.
-2-
4
Section 2. Purchase and Closing.
(a) On the basis of the representations, warranties, agreements and
covenants herein contained and subject to the terms and conditions herein set
forth, the Company agrees to issue and sell to each of the Underwriters, and
each of the Underwriters, severally and not jointly, agrees to purchase from the
Company, at a purchase price of $___ per Share (the "Purchase Price"), the
number of Firm Shares set forth opposite the name of such Underwriter in
Schedule 1 hereto. Firm Shares shall be registered by _________ in the name of
the nominee of the Depository Trust Company ("DTC"), Cede & Co. ("Cede & Co."),
and credited to the accounts of such of its participants as the Representatives
shall request, upon notice to the Company at least 48 hours prior to the First
Closing Date (as defined below), with any transfer taxes payable in connection
with the transfer of the Firm Shares to the Underwriters duly paid, against
payment by or on behalf of the Underwriters to the account of the Company of the
aggregate Purchase Price therefor by wire transfer in immediately available
funds. The Company will make the certificate or certificates for the Firm Shares
available for checking and packaging by the Representatives at the offices in
New York, New York of the Company's transfer agent or registrar or of the
Representatives at least 24 hours prior to the First Closing Date. Delivery or
registry of and payment for the Firm Shares shall be made at the offices of
Venture Law Group, A Professional Corporation, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
▇▇ ▇▇▇▇▇ at 9:30 A.M., New York City time, on _________, 1998 on the fourth full
business day following the date of this Agreement, or at such other place, time
or date as the Representatives and the Company may agree upon. Such time and
date of delivery against payment are herein referred to as the "First Closing
Date", and the implementation of all the actions described in this Section 2(a)
is herein referred to as the "First Closing".
(b) For the purpose of covering any over-allotments in connection with
the distribution and sale of the Firm Shares as contemplated by the Prospectus,
the Company hereby grants to the several Underwriters an option to purchase,
severally and not jointly, the Option Shares. The purchase price to be paid for
any Option Shares shall be the same as the Purchase Price for the Firm Shares
set forth above in paragraph (a) of this Section 2 plus, if the purchase and
sale of any Option Shares takes place after the First Closing Date and after the
Firm Shares are trading "ex-dividend", an amount equal to the dividends payable
on such Option Shares. The option granted hereby may be exercised as to all or
any part of the Option Shares from time to time within thirty days after the
date of the Prospectus (or, if such 30th day shall be a Saturday or Sunday or a
holiday, on the next business day thereafter when the New York Stock Exchange
and the Nasdaq Stock Market's National Market (the "Nasdaq National Market") is
open for trading). The Underwriters shall not be under any obligation to
purchase any of the Option Shares prior to the exercise of such option. The
Representatives may from time to time exercise the option granted hereby by
giving notice in writing or by telephone (confirmed in writing) to the Company
setting forth the aggregate number of Option Shares as to which the several
Underwriters are then exercising the option and the date and time for delivery
or registry of and payment for such Option Shares. Any such date of delivery or
registry shall be determined by the Representatives but shall not be earlier
than two business days or later than five business days after such exercise of
the option and, in any event, shall not be earlier than the First Closing Date.
The time and date set forth in such notice, or such other time or date as the
-3-
5
Representatives and the Company may agree upon or as the Representatives may
determine pursuant to Section 2(a) hereof, is herein called an "Option Closing
Date" with respect to such Option Shares, and the implementation of all the
actions described in this Section 2(b) is herein referred to as the "Option
Closing". As used in this Agreement, the term "Closing Date" means either the
First Closing Date or any Option Closing Date, as applicable, and the term
"Closing" means either the First Closing or any Option Closing, as applicable.
If the option is exercised as to all or any portion of the Option Shares, then
either one or more certificates in definitive form for such Option Shares shall
be delivered or, if such Option Shares are to be held through DTC, such Option
Shares shall be registered and credited, on the related Option Closing Date in
the same manner, and upon the same terms and conditions, set forth in paragraph
(a) of this Section 2, except that reference therein to the Firm Shares and the
First Closing Date shall be deemed, for purposes of this paragraph (b), to refer
to such Option Shares and Option Closing Date, respectively. Upon exercise of
the option as provided herein, the Company shall become obligated to sell to
each of the several Underwriters, and, on the basis of the representations,
warranties, agreements and covenants herein contained and subject to the terms
and conditions herein set forth, each of the Underwriters (severally and not
jointly) shall become obligated to purchase from the Company, the same
percentage of the total number of the Option Shares as to which the several
Underwriters are then exercising the option as such Underwriter is obligated to
purchase of the aggregate number of Firm Shares, as adjusted by the
Representatives in such manner as they deem advisable to avoid fractional
shares.
(c) The Company hereby acknowledges that the payment of monies
pursuant to Section 2(a) hereof (a "Payment") by or on behalf of the
Underwriters of the aggregate Purchase Price for any Shares does not constitute
closing of a purchase and sale of the Shares. Only execution and delivery, by
facsimile or otherwise, of a receipt for Shares by the Underwriters indicates
completion of the closing of a purchase of the Shares from the Company.
Furthermore, in the event that the Underwriters make a Payment to the Company
prior to the completion of the closing of a purchase of Shares, the Company
hereby acknowledges that until the Underwriters execute and deliver such receipt
for the Shares the Company will not be entitled to the Payment and shall return
the Payment to the Underwriters as soon as practicable (by wire transfer of
same-day funds) upon demand. In the event that the closing of a purchase of
Shares is not completed and the Payment is not returned by the Company to the
Underwriters on the same day the Payment was received by the Company, the
Company agrees to pay to the Underwriters in respect of each day the Payment is
not returned by it, in same-day funds, interest on the amount of such Payment in
an amount representing the Underwriters' cost of financing as reasonably
determined by the Representatives.
(d) It is understood that any of you, individually and not as one of
the Representatives, may (but shall not be obligated to) make Payment on behalf
of any Underwriter or Underwriters for any of the Shares to be purchased by such
Underwriter or Underwriters. No such Payment shall relieve such Underwriter or
Underwriters from any of its or their obligations hereunder.
-4-
6
Section 3. Covenants of the Company. The Company covenants and agrees with the
several Underwriters that:
(a) The Company will:
(i) use its best efforts to cause the Registration Statement, if
not effective at the time of execution of this Agreement, and any
amendments thereto to become effective as promptly as possible. If
required, the Company will file the Prospectus or any Term Sheet
that constitutes a part thereof and any amendment or supplement
thereto with the Commission in the manner and within the time
period required by Rules 434 and 424(b) under the Securities Act.
During any time when a prospectus relating to the Shares is
required to be delivered under the Securities Act, the Company (x)
will comply with all requirements imposed upon it by the
Securities Act and the rules and regulations of the Commission
thereunder to the extent necessary to permit the continuance of
sales of or dealings in the Shares in accordance with the
provisions hereof and of the Prospectus, as then amended or
supplemented, and (y) will not file with the Commission the
Prospectus, Term Sheet, any amendment or supplement to such
Prospectus or Term Sheet, any amendment to the Registration
Statement (including the amendment referred to in the second
sentence of Section 5(a)(i)) or any Rule 462(b) Registration
Statement unless the Representatives previously have been advised
of, and furnished with a copy within a reasonable period of time
prior to, the proposed filing and the Representatives shall have
given their consent to such filing. The Company will prepare and
file with the Commission, in accordance with the rules and
regulations of the Commission, promptly upon request by the
Representatives or counsel for the Underwriters, any amendments to
the Registration Statement or amendments or supplements to the
Prospectus that may be necessary or advisable in connection with
the distribution of the Shares by the several Underwriters. The
Company will advise the Representatives, promptly after receiving
notice thereof, of the time when the Registration Statement or any
amendment thereto has been filed or declared effective or the
Prospectus or Term Sheet or any amendment or supplement thereto
has been filed and will provide evidence satisfactory to the
Representatives of each such filing or effectiveness.
(ii) without charge, provide (x) to the Representatives and to
counsel for the Underwriters, an executed and a conformed copy of
the Original Registration Statement and each amendment thereto or
any Rule 462(b) Registration Statement (in each case including
exhibits thereto), (y) to each other Underwriter, a conformed copy
of the Original Registration Statement and each amendment thereto
or any Rule 462(b) Registration Statement (in each case without
exhibits thereto), and (z) so long as a prospectus relating to the
Shares is required to be delivered under the
-5-
7
Securities Act, as many copies of each Preliminary Prospectus or
the Prospectus or any amendment or supplement thereto as the
Representatives may reasonably request. Without limiting the
application of clause (z) of the preceding sentence, the Company,
not later than (I) 9:00 A.M., New York City time, on the business
day following the date of determination of the public offering
price, if such determination occurred at or prior to 12:00 noon,
New York City time, on such date or (II) 6:00 P.M., New York City
time, on the business day following the date of determination of
the public offering price, if such determination occurred after
12:00 noon, New York City time, on such date, will deliver to the
Underwriters, without charge, as many copies of the Prospectus and
any amendment or supplement thereto as the Representatives may
reasonably request for purposes of confirming orders that are
expected to settle on the First Closing Date. The Company will
provide or cause to be provided to each of the Representatives,
and to each Underwriter that so requests in writing, a copy of
each report on Form SR filed by the Company as required by Rule
463 under the Securities Act.
(iii) advise the Representatives, promptly after receiving notice
or obtaining knowledge thereof, of (w) the issuance by the
Commission of any stop order suspending the effectiveness of the
Original Registration Statement or any amendment thereto or any
Rule 462(b) Registration Statement or any order preventing or
suspending the use of any Preliminary Prospectus or the Prospectus
or any amendment or supplement thereto, (x) the suspension of the
qualification of the Shares for offering or sale in any
jurisdiction, (y) the institution, threatening or contemplation of
any proceeding for any purpose identified in the preceding clause
(w) or (x), or (z) any request made by the Commission for amending
the Original Registration Statement or any Rule 462(b)
Registration Statement, for amending or supplementing the
Prospectus or for additional information. The Company will use its
best efforts to prevent the issuance of any such stop order and,
if any such stop order is issued, to obtain the withdrawal thereof
as promptly as possible.
(b) The Company will arrange for the qualification of the Shares for
offering and sale in each jurisdiction as the Representatives shall designate
including, but not limited to, pursuant to applicable state securities ("Blue
Sky") laws of certain states of the United States of America or other U.S.
jurisdictions, and the Company shall maintain such qualifications in effect for
so long as may be necessary in order to complete the placement of the Shares;
provided, however, that the Company shall not be obliged to file any general
consent to service of process or to qualify as a foreign corporation or as a
securities dealer in any jurisdiction or to subject itself to taxation in
respect of doing business in any jurisdiction in which it is not otherwise so
subject.
-6-
8
(c) If, at any time prior to the final date when a prospectus relating
to the Shares is required to be delivered under the Securities Act, any event
occurs as a result of which the Prospectus, as then amended or supplemented,
would include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, or if for any
other reason it shall be necessary at any time to amend the Registration
Statement or amend or supplement the Prospectus to comply with the Securities
Act or the rules or regulations of the Commission thereunder or applicable law,
the Company will promptly notify the Representatives thereof and will promptly,
at its own expense, but subject to the second sentence of Section 3(a)(i)
hereof: (x) prepare and file with the Commission an amendment to the
Registration Statement or amendment or supplement to the Prospectus which will
correct such statement or omission or effect such compliance; and (y) supply any
amended Registration Statement or amended or supplemented Prospectus to the
Underwriters in such quantities as the Underwriters may reasonably request.
(d) The Company will make generally available to the Company's
securityholders and to the Representatives as soon as practicable an earnings
statement that satisfies the provisions of Section 11(a) of the Securities Act,
including Rule 158 thereunder.
(e) The Company will apply the net proceeds from the sale of the
Shares as set forth under "Use of Proceeds" in the Prospectus.
(f) Except as described in the Prospectus, the Company will not, and
will not allow any subsidiary to, publicly announce any intention to, and will
not itself, and will not allow any subsidiary to, without the prior written
consent of the Representatives, on behalf of the Underwriters, (i) offer,
pledge, sell, offer to sell, contract to sell, sell any option or contract to
purchase, purchase any option to sell, grant any option, right or warrant to
purchase, or otherwise transfer or dispose of, directly or indirectly, or
release any optionee from any existing contractual lockup obligations
(including, but not limited to, the restrictions imposed pursuant to the
Company's 1995 Stock Option Plan or 1998 Stock Option Plan or any corresponding
agreement governing a grant thereunder) any shares of Common Stock or any
securities convertible into, or exercisable or exchangeable for, Common Stock,
or (ii) enter into any swap or other agreement that transfers, in whole or in
part, any of the economic consequences of ownership of the shares of Common
Stock or securities convertible into, or exercisable or exchangeable for, shares
of Common Stock (whether any such transaction described in clause (i) or (ii)
above is to be settled by delivery of shares of Common Stock or such other
securities, in cash or otherwise), for a period beginning from the date hereof
and continuing to and including the date 180 days after the date hereof, except
pursuant to this Agreement and other than with respect to (x) shares of Common
Stock to be issued upon the exercise of warrants to purchase shares of Common
Stock, or upon conversion or exchange of securities convertible or exchangeable
into shares of Common Stock, in each case, which are outstanding on the date
hereof and disclosed in the Prospectus, and (y) shares of Common Stock (or any
securities convertible into or exchangeable for shares of Common Stock) issued
pursuant to any employee benefit plans, qualified stock option plans or other
employee compensation plans which are disclosed in the Prospectus.
(g) Neither the Company nor any of its affiliates, nor any person
acting on behalf of any of them will, directly or indirectly, (i) take any
action designed to cause or to result
-7-
9
in, or that has constituted or which might reasonably be expected to constitute,
the stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Shares or (ii) (x) sell, bid for, purchase,
or pay anyone any compensation for soliciting purchases of, the Shares or (y)
pay or agree to pay to any person any compensation for soliciting another to
purchase any other securities of the Company.
(h) The Company will obtain the agreements described in Section 7(f)
hereof prior to the First Closing Date.
(i) If at any time during the 25-day period after the Registration
Statement becomes effective or during the period prior to any Closing Date, any
rumor, publication or event relating to or affecting the Company shall occur as
a result of which in the Representatives' sole judgment 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 the Representatives
advising the Company to the effect set forth above, forthwith prepare, consult
with the Representatives concerning the substance of, and disseminate a press
release or other public statement reasonably satisfactory to the
Representatives, responding to or commenting on such rumor, publication or
event.
(j) If the Company elects to rely on Rule 462(b), the Company shall
both file the Rule 462(b) Registration Statement with the Commission in
compliance with Rule 462(b) and pay the applicable fees in accordance with Rule
111 promulgated under the Securities Act by the earlier of (i) 10:00 P.M. New
York City time on the date of this Agreement and (ii) the time confirmations are
sent or given, as specified by Rule 462(b)(2) under the Securities Act.
(k) The Company will cause the Shares to be duly included for
quotation on the Nasdaq National Market prior to the First Closing Date. The
Company will use its best efforts to ensure that the Shares remain included for
quotation on the Nasdaq National Market for a period of two years following the
First Closing Date.
Section 4. Expenses. The Company shall bear and pay all costs and
expenses incurred incident to the performance of its obligations under this
Agreement, whether or not the transactions contemplated herein are consummated
or this Agreement is terminated pursuant to Section 9 hereof, including: (i)
fees and expenses of preparation, issuance and delivery of this Agreement to the
Underwriters; (ii) the fees and expenses of its counsel, accountants and any
other experts or advisors retained by the Company; (ii) fees and expenses
incurred in connection with the registration of the Shares under the Securities
Act and the preparation and filing of the Registration Statement, the Prospectus
and all amendments and supplements thereto; (iii) the printing and distribution
of the Prospectus and any Preliminary Prospectus and the printing and production
of all other documents connected with the Offering (including this Agreement and
any other related agreements); (iv) expenses related to the qualification of the
Shares under the state securities or Blue Sky laws, including filing fees and
the fees and disbursements of
-8-
10
counsel for the Underwriters in connection therewith and in connection with the
preparation of any Blue Sky memoranda; (v) the filing fees and expenses, if any,
incurred with respect to any filing with the National Association of Securities
Dealers, Inc., including the fees and disbursements of counsel for the
Underwriters in connection therewith; (vi) fees and expenses of an independent
underwriter; (vii) all expenses arising from the quoting of the Shares on the
Nasdaq National Market; (viii) all arrangements relating to the preparation,
issuance and delivery to the Underwriters of any certificates evidencing the
Shares, including transfer agent's and registrar's fees; (ix) the costs and
expenses of the "roadshow" and any other meetings with prospective investors in
the Shares (other than as shall have been specifically approved by the
Representatives to be paid for by the Underwriters); and (x) the costs and
expenses of advertising relating to the Offering (other than as shall have been
specifically approved by the Representatives to be paid for by the
Underwriters).
Section 5. Representations And Warranties.
(a) As a condition of the obligation of the Underwriters to underwrite
and pay for the Shares, the Company represents and warrants to, and agrees with,
each of the several Underwriters as follows:
Registration Statement and Prospectus
(i) The Original Registration Statement, including the Preliminary
Prospectus, has been filed by the Company with the Commission under
the Securities Act, and one or more amendments to such Registration
Statement may have been so filed. After the execution of this
Agreement, the Company will file with the Commission either (x) if
such Registration Statement, as it may have been amended, has been
declared by the Commission to be effective under the Securities Act,
either (I) if the Company relies on Rule 434 under the Securities Act,
a Term Sheet relating to the Shares that shall identify the
Preliminary Prospectus that it supplements containing such information
as is required or permitted by Rules 434, 430A and 424(b) under the
Securities Act or (II) if the Company does not rely on Rule 434 under
the Securities Act, a prospectus in the form most recently included in
an amendment to such Registration Statement (or, if no such amendment
shall have been filed, in such Registration Statement), with such
changes or insertions as are required by Rule 430A under the
Securities Act or permitted by Rule 424(b) under the Securities Act,
and in the case of either clause (I) or (II) of this sentence, as have
been provided to and approved by the Representatives prior to the
execution of this Agreement, or (y) if such Registration Statement, as
it may have been amended, has not been declared by the Commission to
be effective under the Securities Act, an amendment to such
Registration Statement, including a form of prospectus, a copy of
which amendment has been furnished to and approved by the
Representatives prior to the execution of this Agreement. The Company
may also file a Rule 462(b) Registration Statement with the Commission
for the purpose of registering certain additional Shares, which
registration shall be effective upon filing with the Commission.
-9-
11
(ii) The Commission has not issued any order preventing or
suspending the use of any Preliminary Prospectus. When any Preliminary
Prospectus was filed with the Commission, it (x) contained all
statements required to be stated therein in accordance with, and
complied in all material respects with the requirements of, the
Securities Act and the rules and regulations of the Commission
thereunder and (y) did not include any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. When the Registration Statement or any
amendment thereto was or is declared effective, it (I) contained or
will contain all statements required to be stated therein in
accordance with, and complied or will comply in all material respects
with the requirements of, the Securities Act and the rules and
regulations of the Commission thereunder and (II) did not or will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading. When the Prospectus or any Term
Sheet that is a part thereof or any amendment or supplement to the
Prospectus is filed with the Commission pursuant to Rule 424(b) (or,
if the Prospectus or such amendment or supplement is not required to
be so filed, when the Registration Statement or the amendment thereto
containing the Prospectus or such amendment or supplement to the
Prospectus was or is declared effective) and on the Closing Date, the
Prospectus, as amended or supplemented at any such time, (A) contained
or will contain all statements required to be stated therein in
accordance with, and complied or will comply in all material respects
with the requirements of, the Securities Act and the rules and
regulations of the Commission thereunder and (B) did not or will not
include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading. The foregoing provisions of this paragraph (ii) do not
apply to statements or omissions made in any Preliminary Prospectus,
the Registration Statement or any amendment thereto or the Prospectus
or any amendment or supplement thereto in reliance upon and in
conformity with written information furnished to the Company by any
Underwriter through the Representatives specifically for use therein.
(iii) If the Company has elected to rely on Rule 462(b) and the
Rule 462(b) Registration Statement is not effective, (x) the Company
will file a Rule 462(b) Registration Statement in compliance with, and
that is effective upon filing pursuant to, Rule 462(b) and (y) the
Company has given irrevocable instructions for transmission of the
applicable filing fee in connection with the filing of the Rule 462(b)
Registration Statement, in compliance with Rule 111 under the
Securities Act, or the Commission has received payment of such filing
fee.
(iv) If the Company has elected to rely on Rule 434 under the
Securities Act, the Prospectus is not "materially different", as such
term is used in Rule 434, from the prospectus included in the
Registration Statement at the time
-10-
12
of its effectiveness or an effective post-effective amendment thereto
(including such information that is permitted to be omitted pursuant
to Rule 430A under the Securities Act);
(v) The Company has not distributed and, prior to the later of (x)
any Closing Date and (y) the completion of the distribution of the
Shares, will not distribute any offering material in connection with
the Offering other than the Registration Statement or any amendment
thereto, any Preliminary Prospectus or the Prospectus or any amendment
or supplement thereto.
(vi) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus (x) the Company
and its subsidiaries, taken as a whole, have not incurred any material
liability or obligation, direct or contingent, nor entered into any
material transaction not in the ordinary course of business; (y) the
Company has not purchased any of its outstanding capital stock, nor
declared, paid or otherwise made any dividend or distribution of any
kind on its capital stock; and (z) there has not been any material
change in the capital stock, short-term or long-term debt of the
Company and its subsidiaries, taken as a whole, except in each case as
described in or contemplated by the Prospectus.
The Shares
(vii) The Company has an authorized, issued and outstanding
capitalization as set forth in the Prospectus. All of the issued
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 applicable federal and state securities laws
and were not issued in violation of or subject to any preemptive
rights or other rights to subscribe for or purchase such securities.
The Shares have been duly authorized by all necessary corporate action
of the Company and, after payment therefor in accordance herewith,
will be validly issued, fully paid and nonassessable at the Closing
Date. No holders of outstanding shares of capital stock of the Company
are entitled as such to any preemptive or other rights to subscribe
for any of the Shares, and no holder of securities of the Company has
any right which has not been fully exercised or waived to require the
Company to register the offer or sale of any securities owned by such
holder under the Securities Act in the Offering contemplated by this
Agreement.
(viii) Except as disclosed in the Prospectus, there are no
outstanding (x) securities or obligations of the Company or any of its
subsidiaries convertible into or exchangeable for any capital stock of
the Company or any such subsidiary, (y) warrants, rights or options to
subscribe for or purchase from the Company or any such subsidiary any
such capital stock or any such convertible or exchangeable securities
or obligations, or (z) obligations of the Company or any
-11-
13
such subsidiary to issue any shares of capital stock, any such
convertible or exchangeable securities or obligations, or any such
warrants, rights or options.
(ix) Except for the shares of capital stock of each of the
subsidiaries owned by the Company and such subsidiaries, neither the
Company nor any such subsidiary owns any shares of stock or any other
equity securities of any corporation or has any equity interest in any
firm, partnership, association or other entity, except as described in
or contemplated by the Prospectus.
Listing
(x) All of the Shares have been duly authorized and accepted for
quotation on the Nasdaq National Market, subject to official notice of
issuance.
Market manipulation
(xi) Neither the Company nor any of its affiliates, nor any person
acting on behalf of any of them has, directly or indirectly, (x) taken
any action designed to cause or to result in, or that has constituted
or which might reasonably be expected to constitute, the stabilization
or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Shares, or (y) since the filing
of the Original Registration Statement (I) sold, bid for, purchased,
or paid anyone any compensation for soliciting purchases of, the
Shares or (II) paid or agreed to pay to any person any compensation
for soliciting another to purchase any other securities of the
Company.
Corporate power and authority
(xii) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the law of its
jurisdiction of incorporation with full power and authority to own,
lease and operate its properties and assets and conduct its business
as described in the Prospectus, is duly qualified to transact business
and is in good standing in each jurisdiction in which its ownership,
leasing or operation of its properties or assets or the conduct of its
business requires such qualification, except where the failure to be
so qualified does not amount to a material liability or disability to
the Company and its subsidiaries, taken as a whole, and has full power
and authority to execute and perform its obligations under this
Agreement; each subsidiary of the Company is a corporation duly
incorporated and validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation and is duly
qualified to transact business and is in good standing in each
jurisdiction in which its ownership, leasing or operation of its
properties or assets or the conduct of its business requires such
qualification, except where the failure to be so qualified does not
amount to a material liability or disability to the Company and its
subsidiaries, taken as a whole, and each has full power and authority
to own, lease and operate its properties and assets and conduct its
business as described in the
-12-
14
Registration Statement and the Prospectus; all of the issued and
outstanding shares of capital stock of each of the Company's
subsidiaries have been duly authorized and are fully paid and
nonassessable and are owned beneficially by the Company free and clear
of any security interests, liens, encumbrances, equities or claims
except as disclosed in the Prospectus.
(xiii) The execution and delivery of this Agreement and the
issuance and sale of the Shares have been duly authorized by all
necessary corporate action of the Company, and this Agreement has been
duly executed and delivered by the Company and is the valid and
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as such enforceability may be
limited by principles of public policy and subject to the laws of
general application relating to bankruptcy, involvency and relief of
debtors and rules of law governing specific performance, injunctive
relief or other equitable remedies.
(xiv) The issuance, offering and sale of the Shares to the
Underwriters by the Company pursuant to this Agreement, the compliance
by the Company with the other provisions of this Agreement and the
consummation of the other transactions herein contemplated do not (x)
require the consent, approval, authorization, registration or
qualification of or with any governmental authority, except such as
have been obtained or made or such as may be required by the state
securities or Blue Sky laws of the various states of the United States
of America or other U.S. jurisdictions in connection with the offer
and sale of the Shares by the Underwriters, or (y) conflict with or
result in a breach or violation of any of the terms and provisions of,
or constitute a default under, any indenture, mortgage, deed of trust,
lease or other agreement or instrument to which the Company or any of
its subsidiaries is a party or by which the Company or any of its
subsidiaries or any of their respective properties are bound, or the
charter documents or by-laws of the Company or any of its
subsidiaries, or any statute or any judgment, decree, order, rule or
regulation of any court or other governmental authority or any
arbitrator applicable to the Company or any of its subsidiaries except
as such enforceability may be limited by principles of public policy
and subject to the laws of general applications relating to
bankruptcy, insolvency and relief of debtors and rules of law
governing specific performance, injunctive relief or other equitable
remedies.
(xv) The Company is not, and will conduct its operations in a
manner so that it continues not to be, an "investment company" and,
after giving effect to the Offering and the application of the
proceeds therefrom, will not be an "investment company", as such term
is defined in the Investment Company Act of 1940, as amended (the
"1940 Act").
Title, licenses and consents
(xvi) The Company and each of its subsidiaries have good and
marketable title in fee simple to all items of real property and
marketable title to all personal property owned by each of them, in
each case free and clear of any security interests, liens,
encumbrances, equities, claims and other defects, except
-13-
15
such as do not materially and adversely affect the value of such
property and do not interfere with the use made or proposed to be made
of such property by the Company or such subsidiary, and any real
property and buildings held under lease by the Company or any such
subsidiary are held under valid, subsisting and enforceable leases,
with such exceptions as are not material and do not interfere with the
use made or proposed to be made of such property and buildings by the
Company or such subsidiary, in each case except as described in or
contemplated by the Prospectus.
(xvii) 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,
know-how, copyrights, trade secrets and proprietary or other
confidential information necessary to operate the business now
operated by them, and neither the Company nor any such subsidiary has
received any 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 have a materially adverse effect on or
constitute a materially adverse change in, or constitute a development
involving a prospective materially adverse effect on or change in, the
condition (financial or otherwise), earnings, properties, business
affairs or business prospects, stockholders' equity, net worth or
results of operations of the Company or any of its subsidiaries, taken
as a whole, except as described in or contemplated by the Prospectus.
(xviii) The Company and its subsidiaries possess all consents,
licenses, certificates, authorizations and permits issued by the
appropriate federal, state or foreign regulatory authorities necessary
to conduct their respective businesses, and neither the Company nor
any such subsidiary has received any notice of proceedings relating to
the revocation or modification of any such certificate, authorization
or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would have a materially
adverse effect on or constitute a materially adverse change in, or
constitute a development involving a prospective materially adverse
effect on or change in, the condition (financial or otherwise),
earnings, properties, business affairs or business prospects, net
worth or results of operations of the Company or any of its
subsidiaries, taken as a whole, except as described in or contemplated
by the Prospectus.
Financial statements
(xix) ▇▇▇▇▇ & Young LLP, who have certified certain financial
statements of the Company and its consolidated subsidiaries and
delivered their report with respect to the audited consolidated
financial statements and schedules included in the Registration
Statement and the Prospectus, are independent public
-14-
16
accountants as required by the Securities Act and the applicable rules
and regulations thereunder.
(xx) The consolidated financial statements and schedules of the
Company and its consolidated subsidiaries included in the Registration
Statement and the Prospectus were prepared in accordance with
generally accepted accounting principles ("GAAP") consistently applied
throughout the periods involved, in all material respects, and they
present fairly the financial condition of the Company as at the dates
at which they were prepared and the results of operations of the
Company in respect of the periods for which they were prepared.
Internal Accounting Controls
(xxi) The Company and each of its subsidiaries maintain a system
of internal accounting controls sufficient to provide reasonable
assurance that (w) transactions are executed in accordance with
management's general or specific authorizations; (x) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain asset accountability; (y) access
to assets is permitted only in accordance with management's general or
specific authorization; and (z) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
Litigation
(xxii) No legal or governmental proceedings are pending or, to the
Company's knowledge, threatened to which the Company or any of its
subsidiaries is a party or to which the property of the Company or any
of its subsidiaries is subject that are required to be described in
the Registration Statement or the Prospectus and are not described
therein; and no statutes, regulations, contracts or other documents
that are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement
that are not described therein or filed as required.
Dividends and Distributions
(xxiii) No subsidiary of the Company is currently prohibited,
directly or indirectly, from paying any dividends to the Company,
making any other distribution on such subsidiary's capital stock,
repaying to the Company any loans or advances to such subsidiary from
the Company or transferring any of such subsidiary's property or
assets to the Company or any other subsidiary of the Company, and the
Company is not currently prohibited, directly or indirectly, from
paying any dividends or making any other distribution on its capital
stock, in each case except as described in or contemplated by the
Prospectus.
-15-
17
Taxes
(xxiv) The Company has filed all foreign, federal, state and local
tax returns that are required to be filed or has requested extensions
thereof (except in any case in which the failure so to file would not
have a materially adverse effect on the Company and its subsidiaries,
taken as a whole) and has paid all taxes required to be paid by it and
any other assessment, fine or penalty levied against it, to the extent
that any of the foregoing is due and payable, except for any such
assessment, fine or penalty that is currently being contested in good
faith or as described in or contemplated by the Prospectus.
Insurance
(xxv) The Company and each of its subsidiaries are insured by
insurers of recognized financial responsibility against such losses
and risks and in such amounts as are prudent and customary in the
businesses in which they are engaged; neither the Company nor any such
subsidiary has been refused any insurance coverage sought or applied
for; and neither the Company nor any such subsidiary has any reason to
believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar
coverage from similar insurers as may be necessary to continue its
business at a cost that would not materially and adversely affect the
condition (financial or otherwise), earnings, properties, business
affairs or business prospects, net worth or results of operations of
the Company or any of its subsidiaries, taken as a whole, except as
described in or contemplated by the Prospectus.
Pension and Labor
(xxvi) The Company is in compliance in all material respects with
all presently applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations and
published interpretations thereunder ("ERISA"); no "reportable event"
(as defined in ERISA) has occurred with respect to any "pension plan"
(as defined in ERISA) for which the Company would have any liability;
the Company has not incurred and does not expect to incur liability
under (i) Title IV of ERISA with respect to termination of, or
withdrawal from, any "pension plan" or (ii) Sections 412 or 4971 of
the Internal Revenue Code of 1986, as amended, including the
regulations and published interpretations thereunder (the "Code"); and
each "pension plan" for which the Company would have any liability
that is intended to be qualified under Section 401(a) of the Code is
so qualified in all material respects and nothing has occurred,
whether by action or by failure to act, which would cause the loss of
such qualification.
(xxvii) No labor dispute with the employees of the Company or any
of its subsidiaries exists or, to the Company's knowledge, is
threatened or imminent that could have a materially adverse
-16-
18
effect on or constitute a materially adverse change in, or constitute
a development involving a prospective materially adverse effect on or
change in, the condition (financial or otherwise), properties,
management, earnings, business affairs or business prospects, net
worth or results of operations of the Company or any of its
subsidiaries, taken as a whole, except as described in or contemplated
by the Prospectus.
Environmental
(xxviii) Neither the Company nor any of its subsidiaries is in
violation of any federal or state law or regulation relating to
occupational safety and health or to the storage, handling or
transportation of hazardous or toxic materials and the Company and its
subsidiaries have received all permits, licenses or other approvals
required of them under applicable federal and state occupational
safety and health and environmental laws and regulations to conduct
their respective businesses, and the Company and each such subsidiary
is in compliance with all terms and conditions of any such permit,
license or approval, except any such violation of law or regulation,
failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits,
licenses or approvals which would not, singly or in the aggregate,
have a materially adverse effect on or constitute a materially adverse
change in, or constitute a development involving a prospective
materially adverse effect on or change in, the condition (financial or
otherwise), earnings, properties, business affairs or business
prospects, net worth or results of operations of the Company or any of
its subsidiaries, taken as a whole, except as described in or
contemplated by the Prospectus.
Other Agreements
(xxix) No default exists, and no event has occurred which, with
notice or lapse of time or both, would constitute a default in the due
performance and observance of any term, covenant or condition of any
indenture, mortgage, deed of trust, lease or other agreement or
instrument to which the Company or any of its subsidiaries is a party
or by which the Company or any of its subsidiaries or any of their
respective properties is bound.
Absence of Materially Adverse Change
(xxx) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, neither the
Company nor any of its subsidiaries has sustained any material loss or
interference with their respective businesses 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, to the Company's knowledge, there has been no
materially adverse change (including, without limitation, a change in
management or control), or development involving a prospective
materially adverse change, in the condition (financial or otherwise),
management, earnings,
-17-
19
property, business affairs or business prospects, stockholders'
equity, net worth or results of operations of the Company or any of
its subsidiaries, taken as a whole, other than as described in or
contemplated by the Prospectus (exclusive of any amendments or
supplements thereto).
(xxxi) No receiver or liquidator (or similar person) has been
appointed in respect of the Company or any subsidiary of the Company or in
respect of any part of the assets of the Company or any subsidiary of the
Company; no resolution, order of any court, regulatory body, governmental body
or otherwise, or petition or application for an order, has been passed, made or
presented for the winding up of the Company or any subsidiary of the Company or
for the protection of the Company or any such subsidiary from its creditors; and
the Company has not, and no subsidiary of the Company has, stopped or suspended
payments of its debts, become unable to pay its debts or otherwise become
insolvent.
(b) The above representations and warranties shall be deemed to be
repeated at each Closing, and all references therein to the Shares and the
Closing Date shall be deemed to refer to the Firm Shares or the Option Shares
and the First Closing Date or the applicable Option Closing Date, each as
applicable.
Section 6. Indemnity.
(a) The Company agrees to indemnify and hold harmless each Underwriter
and each person, if any, who controls any Underwriter within the meaning of
Section 15 of the Securities Act or Section 20 of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), against any and all losses, claims,
damages or liabilities, joint or several, to which such Underwriter or such
controlling person may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue statement made by the
Company in Section 5 hereof,
(ii) any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement or any
amendment thereto, any Preliminary Prospectus or the Prospectus or
any amendment or supplement thereto, or
(iii) the omission or alleged omission to state in the
Registration Statement or any amendment thereto, any Preliminary
Prospectus or the Prospectus or any amendment or supplement
thereto a material fact required to be stated therein or necessary
to make the statements therein not misleading,
-18-
20
and will reimburse, as incurred, each Underwriter and each such controlling
person for any legal or other costs or expenses reasonably incurred by such
Underwriter or such controlling person in connection with investigating,
defending against or appearing as a third-party witness in connection with any
such loss, claim, damage, liability or action; provided, however, that the
Company will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon any untrue statement
or alleged untrue statement or omission or alleged omission made in the
Registration Statement or any amendment thereto, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto in reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through the Representatives specifically for use therein. The indemnity provided
for in this Section 6 shall be in addition to any liability which the Company
may otherwise have. The Company will not, without the prior written consent of
the Representatives, settle or compromise or consent to the entry of any
judgment in any pending or threatened claim, action, suit or proceeding in
respect of which indemnification may be sought hereunder (whether or not any
such Representatives or any person who controls any such Representatives is a
party to such claim, action, suit or proceeding), unless such settlement,
compromise or consent includes an unconditional release of all of the
Underwriters and such controlling persons from all liability arising out of such
claim, action, suit or proceeding.
(b) Each Underwriter, severally and not jointly, will indemnify and
hold harmless the Company, each of its directors, each of its officers who
signed the Registration Statement and each person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act against any losses, claims, damages or liabilities to which the
Company or any such director, officer or controlling person may become subject
under the Securities Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
(i) any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement or any amendment thereto, any
Preliminary Prospectus or the Prospectus or any amendment or supplement thereto
or (ii) the omission or the alleged omission to state in the Registration
Statement or any amendment thereto, any Preliminary Prospectus or the Prospectus
or any amendment or supplement thereto a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in reliance upon and
in conformity with written information furnished to the Company by such
Underwriter through the Representatives specifically for use therein, and,
subject to the limitation set forth immediately preceding this clause, will
reimburse, as incurred, any legal or other expenses reasonably incurred by the
Company or any such director, officer or controlling person in connection with
investigating, defending against or appearing as a third-party witness in
connection with any such loss, claim, damage, liability or any action in respect
thereof. The remedies provided for in this Section 6 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.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to paragraph (a) or (b) of this Section 6, such person (for
purposes of this paragraph (c), the
-19-
21
"indemnified party") shall, promptly after receipt by such party of notice of
the commencement of such action, notify the person against whom such indemnity
may be sought (for purposes of this paragraph (c), the "indemnifying party"),
but the omission so to notify the indemnifying party will not relieve it from
any liability which it may have to any indemnified party otherwise than under
this Section 6. 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
that it may wish, jointly with any other indemnifying party similarly notified,
to assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party; provided, however, that if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be one or more
legal defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying party, the
indemnifying party shall not have the right to direct the defense of such action
on behalf of such indemnified party or parties and such indemnified party or
parties shall have the right to select separate counsel to defend such action on
behalf of such indemnified party or parties. After notice from the indemnifying
party to such indemnified party of its election so to assume the defense of any
such action and approval by such indemnified party of counsel appointed to
defend such action, the indemnifying party will not be liable to such
indemnified party under this Section 6 for any legal or other expenses, other
than reasonable costs of investigation, subsequently incurred by such
indemnified party in connection with the defense thereof, unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that in
connection with such action the indemnifying party shall not be liable for the
expenses of more than one separate counsel (in addition to local counsel) in any
one action or separate but substantially similar actions in the same
jurisdiction arising out of the same general allegations or circumstances,
designated in writing by the Representatives in the case of paragraph (a) of
this Section 6, representing the indemnified parties under such paragraph (a)
who are parties to such action or actions), or (ii) the indemnifying party does
not promptly retain counsel reasonably satisfactory to the indemnified party, or
(iii) the indemnifying party has authorized the employment of counsel for the
indemnified party at the expense of the indemnifying party. All fees and
expenses reimbursed pursuant to this paragraph (c) shall be reimbursed as they
are incurred. After such notice from the indemnifying party to such indemnified
party, the indemnifying party will not be liable for the costs and expenses of
any settlement of such action effected by such indemnified party without the
consent of the indemnifying party.
(d) In circumstances in which the indemnity agreement provided for in
the preceding paragraphs of this Section 6 is unavailable or insufficient, for
any reason, to hold harmless an indemnified party in respect of any losses,
claims, damages or liabilities (or actions in respect thereof), each
indemnifying party, in order to provide for just and equitable contribution,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or actions in respect
thereof) in such proportion as is appropriate to reflect (i) the relative
benefits received by the indemnifying party or parties on the one hand and the
indemnified party on the other from the Offering or (ii) if the allocation
provided by the foregoing clause (i) is not permitted by applicable law, not
only such relative benefits but also the relative fault of the indemnifying
party or parties on the one hand and the
-20-
22
indemnified party on the other in connection with the statements or omissions or
alleged statements or omissions that resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total proceeds from the Offering (before deducting expenses)
received by the Company bear to the total underwriting discounts and commissions
received by the Underwriters. The relative fault of the parties 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, the parties' relative intents, knowledge, access to information
and opportunity to correct or prevent such statement or omission, and any other
equitable considerations appropriate in the circumstances. The Company and the
Underwriters agree that it would not be equitable if the amount of such
contribution were determined by pro rata or per capita allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other method
of allocation that does not take into account the equitable considerations
referred to above in this paragraph (d). Notwithstanding any other provision of
this paragraph (d), no Underwriter shall be obligated to make contributions
hereunder that in the aggregate exceed the total public offering price of the
Shares purchased by such Underwriter under this Agreement, less the aggregate
amount of any damages that such Underwriter has otherwise been required to pay
in respect of the same or any substantially similar claim, and no person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations to
contribute hereunder are several in proportion to their respective underwriting
obligations and not joint, and contributions among Underwriters shall be
governed by the provisions of the Deutsche ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc. Master Agreement
Among Underwriters. For purposes of this paragraph (d), each person, if any, who
controls an Underwriter within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act shall have the same rights to contribution as
such Underwriter, and each director of the Company, each officer of the Company
who signed the Registration Statement and each person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act, shall have the same rights to contribution as the Company.
Section 7. Conditions Precedent. The obligations of the several Underwriters to
purchase and pay for the Shares shall be subject, in the Representatives' sole
discretion, to the accuracy of the representations and warranties of the Company
contained herein as of the date hereof and as of each Closing Date, as if made
on and as of each Closing Date, to the accuracy of the statements of the
Company's officers made pursuant to the provisions hereof, to the performance by
the Company of its covenants and agreements hereunder and to the following
additional conditions:
(a) (i) If the Original Registration Statement or any amendment
thereto filed prior to the First Closing Date has not been declared effective as
of the time of execution hereof, the Original Registration Statement or such
amendment shall have been declared effective not later than 6:00 P.M. New York
City time on the date of determination of the public offering price, if such
determination occurred at or prior to 4:30 P.M. New York City time on such date,
-21-
23
or 12:00 Noon New York City time on the business day following the day on which
the public offering price was determined, if such determination occurred after
4:30 P.M. New York City time on such date, and (ii) if the Company has elected
to rely upon Rule 462(b), the Rule 462(b) Registration Statement shall have been
declared effective not later than the time confirmations are sent or given as
specified by Rule 462(b)(2), or such later time and date as shall have been
consented to by the Representatives; if required, the Prospectus or any Term
Sheet that constitutes a part thereof and any amendment or supplement thereto
shall have been filed with the Commission in the manner and within the time
period required by Rules 434 and 424(b) under the Securities Act; no stop order
suspending the effectiveness of the Registration Statement or any amendment
thereto shall have been issued, and no proceedings for that purpose shall have
been instituted or threatened or, to the knowledge of the Company or the
Representatives, shall be contemplated by the Commission; and the Company shall
have complied with any request of the Commission for additional information (to
be included in the Registration Statement or the Prospectus or otherwise).
(b) The Representatives shall have received a legal opinion from
▇▇▇▇▇▇▇, Tufts, ▇▇▇▇ & Black, LLP, counsel for the Company, dated the Closing
Date, to the effect that:
(i) the Registration Statement is effective under the Securities
Act; any required filing of the Prospectus, or any Term Sheet that
constitutes a part thereof, pursuant to Rules 434 and 424(b) has
been made in the manner and within the time period required by
Rules 434 and 424(b); and no stop order suspending the
effectiveness of the Registration Statement or any amendment
thereto has been issued and, to the best knowledge of such
counsel, no proceedings for that purpose are pending or threatened
by the Commission;
(ii) the Original Registration Statement and each amendment
thereto, any Rule 462(b) Registration Statement and the Prospectus
(in each case, other than the financial statements and other
financial information contained therein, as to which such counsel
need express no opinion) comply as to form in all material
respects with the applicable requirements of the Securities Act
and the rules and regulations of the Commission thereunder;
(iii) such counsel has no reason to believe that (in each case,
other than the financial statements and other financial
information contained therein, as to which such counsel need
express no opinion) (x) the Registration Statement, as of its
effective date, contained any untrue statement of a material fact
or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or (y)
the Prospectus, as of its date or the date of such opinion,
included or includes any untrue statement of a material fact or
omitted or omits to state any material fact necessary in order to
make the statements therein, in the light of the circumstances
under which they were made, not misleading.
-22-
24
(iv) if the Company elects to rely on Rule 434 under the
Securities Act, the Prospectus is not "materially different", as
such term is used in Rule 434, from the prospectus included in the
Registration Statement at the time of its effectiveness or an
effective post-effective amendment thereto (including such
information that is permitted to be omitted pursuant to Rule 430A
under the Securities Act);
(v) the Company has an authorized, issued and outstanding
capitalization as set forth in the Prospectus; all of the issued
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 applicable federal and state
securities laws and were not issued in violation of or subject to
any preemptive rights or other rights to subscribe for or purchase
securities; the Shares have been duly authorized by all necessary
corporate action of the Company and, when issued and delivered to
and paid for by the Underwriters pursuant to this Agreement, will
be validly issued, fully paid and nonassessable; no holders of
outstanding shares of capital stock of the Company are entitled as
such to any preemptive or other rights to subscribe for any of the
Shares; and no holder of securities of the Company has any right
which has not been fully exercised or waived to require the
Company to register the offer or sale of any securities owned by
such holder under the Securities Act in the Offering contemplated
by this Agreement;
(vi) all of the Shares have been duly authorized and accepted for
quotation on the Nasdaq National Market, subject to official
notice of issuance;
(vii) the Company and each of its subsidiaries have been duly
organized and are validly existing as corporations in good
standing under the laws of their respective jurisdictions of
incorporation and are duly qualified to transact business as
foreign corporations and are in good standing under the laws of
all other jurisdictions where the ownership, leasing or operation
of their respective properties or assets or the conduct of their
respective businesses requires such qualification, except where
the failure to be so qualified does not amount to a material
liability or disability to the Company and its subsidiaries, taken
as a whole; the Company and each of its subsidiaries have full
power and authority to own, lease and operate their respective
properties and assets and conduct their respective businesses as
described in the Registration Statement and the Prospectus, and
the Company has corporate power to enter into this Agreement and
to carry out all the terms and provisions hereof to be carried out
by it; all of the issued and outstanding shares of capital stock
of each of the Company's subsidiaries have been duly authorized
and validly issued, are fully paid and nonassessable and are owned
beneficially by the
-23-
25
Company free and clear of any perfected security interests or, to
the best knowledge of such counsel, any other security interests,
liens, encumbrances, equities or claims;
(viii) the statements set forth under the heading "Description of
Capital Stock" in the Prospectus, insofar as such statements
purport to summarize certain provisions of the capital stock of
the Company, provide a fair summary of such provisions; and the
statements set forth under the headings in the Prospectus, insofar
as such statements constitute a summary of the legal matters,
documents or proceedings referred to therein, have been reviewed
by such counsel and fairly present the information called for with
respect to such legal matters, documents and proceedings in all
material respects as required by the Securities Act and the rules
and regulations thereunder;
(ix) the execution and delivery of this Agreement have been duly
authorized by all necessary corporate action of the Company and
this Agreement has been duly executed and delivered by the
Company;
(x) the issuance, offering and sale of the Shares to the
Underwriters by the Company pursuant to this Agreement, the
compliance by the Company with the other provisions of this
Agreement and the consummation of the other transactions herein
contemplated do not (x) require the consent, approval,
authorization, registration or qualification of or with any
governmental authority, except such as have been obtained or made
(and specified in such opinion) or such as may be required by the
securities or Blue Sky laws of the various states of the United
States of America and other U.S. jurisdictions in connection with
the offer and sale of the Shares by the Underwriters, or (y)
conflict with or result in a breach or violation of any of the
terms and provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, lease or other agreement or
instrument, known to such counsel, to which the Company or any of
its subsidiaries is a party or by which the Company or any of its
subsidiaries or any of their respective properties are bound, or
the charter documents or by-laws of the Company or any of its
subsidiaries, or any statute or any judgment, decree, order, rule
or regulation of any court or other governmental authority or any
arbitrator known to such counsel and applicable to the Company or
its subsidiaries;
(xi) the Company is not an "investment company" and, after giving
effect to the Offering and the application of the proceeds
therefrom, will not be an "investment company", as such term is
defined in the 1940 Act; and
-24-
26
(xii) such counsel does not know of any legal or governmental
proceedings pending or threatened to which the Company or any of
its subsidiaries is a party or to which the property of the
Company or any of its subsidiaries is subject that are required to
be described in the Registration Statement or the Prospectus and
are not described therein or any statutes, regulations, contracts
or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement that are not described
therein or filed as required.
In rendering any such opinion, such counsel may rely, as to matters of
fact, to the extent such counsel deems proper, on certificates of responsible
officers of the Company and public officials and, as to matters involving the
application of laws of any jurisdiction other than the State of Delaware or the
United States, to the extent satisfactory in form and scope to counsel for the
Underwriters, upon the opinion of local counsel. The foregoing opinion shall
also state that the Underwriters are justified in relying upon such opinion of
local counsel, and copies of such opinion shall be delivered to the
Representatives and counsel for the Underwriters.
References to the Registration Statement and the Prospectus in this
paragraph (b) shall include any amendment or supplement thereto at the date of
such opinion. The opinions of issuer's counsel described herein shall be
rendered to the Underwriters at the request of the Company and shall so state
therein.
(c) The Representatives shall have received a legal opinion from
Venture Law Group, counsel for the Underwriters, dated the Closing Date,
covering the issuance and sale of the Shares, the Registration Statement and the
Prospectus, and such other related matters as the Representatives may reasonably
require, and the Company shall have furnished to such counsel such documents as
they may reasonably request for the purpose of enabling them to pass upon such
matters.
(d) The Representatives shall have received from Ernst & Young LLP a
letter or letters dated, respectively, the date hereof and the Closing Date, in
form and substance satisfactory to the Representatives, to the effect that:
(i) they are independent accountants with respect to the Company
and its consolidated subsidiaries within the meaning of the
Securities Act and the applicable rules and regulations
thereunder;
(ii) in their opinion, the audited consolidated financial
statements and schedules examined by them and included in the
Registration Statement and the Prospectus comply in form in all
material respects with the applicable accounting requirements of
the Securities Act and the related published rules and
regulations;
(iii) on the basis of their review in accordance with standards
established by the American Institute of Certified Public
Accountants of
-25-
27
any interim unaudited consolidated condensed financial statements
of the Company and its consolidated subsidiaries or unaudited
consolidated financial statements of the Company and its
consolidated subsidiaries included in the Registration Statement
and the Prospectus, carrying out certain specified procedures
(which do not constitute an examination made in accordance with
generally accepted auditing standards) that would not necessarily
reveal matters of significance with respect to the comments set
forth in this paragraph (iii), a reading of the minute books of
the shareholders, the board of directors and any committees
thereof of the Company and each of its consolidated subsidiaries,
and inquiries of certain officials of the Company and its
consolidated subsidiaries who have responsibility for financial
and accounting matters, nothing came to their attention that
caused them to believe that:
(x) the unaudited consolidated condensed financial statements
of the Company and its consolidated subsidiaries included in
the Registration Statement and the Prospectus do not comply
in form in all material respects with the applicable
accounting requirements of the Securities Act and the related
published rules and regulations thereunder or are not in
conformity with GAAP applied on a basis substantially
consistent with that of the audited consolidated financial
statements included in the Registration Statement and the
Prospectus;
(y) for the latest month for which the Company has closed its
books prior to the date of such letter, there were any
changes in the capital stock or long-term debt of the Company
and its consolidated subsidiaries or any decreases in net
current assets or stockholders' equity of the Company and its
consolidated subsidiaries, in each case compared with amounts
shown on the March 31, 1998 consolidated balance sheet
included in the Registration Statement and the Prospectus, or
for the period from April 1, 1998 to such specified date and
as of such specified date there was any decrease, as compared
with the corresponding period in the preceding three (3)
months, in net revenues of the Company and its consolidated
subsidiaries or any changes in the capital stock or long-term
debt of the Company as compared with amounts shown on the
March 31, 1998 consolidated balance sheet, except in all
instances for changes, decreases or increases set forth in
such letter.
(iv) they have carried out certain specified procedures, not
constituting an audit, with respect to certain amounts,
percentages and financial information that are derived from the
general accounting records of the Company and its consolidated
subsidiaries and are included in the
-26-
28
Registration Statement and the Prospectus under the following
headings: "Prospectus Summary"; "The Company"; "Risk Factors --
Limited Operating History; History of Net Operating Losses;
Accumulated Deficit," "--Customer Concentration; Risks Associated
with Reliance on United States Government Contracts"; "Dividend
Policy"; "Capitalization"; "Dilution"; "Selected Consolidated
Financial Data"; "Management's Discussion and Analysis of
Financial Condition and Results of Operations";
"Business--Overview", "Products," "Employees";
"Management--Directors' Compensation," "Summary Compensation
Table," "Option Grants," "Option Exercises and Fiscal Year End
Values," "Stock Option Plans"; "Certain Transactions";
"Description of Capital Stock", and have compared such amounts,
percentages and financial information with such records of the
Company and its consolidated subsidiaries and with information
derived from such records and have found them to be in agreement,
excluding any questions of legal interpretation.
In the event that the letters referred to above set forth any such
changes, decreases or increases, it shall be a further condition to the
obligations of the Underwriters that (I) such letters shall be accompanied by a
written explanation of the Company as to the significance thereof, unless the
Representatives deem such explanation unnecessary, and (II) such changes,
decreases or increases do not, in the sole judgment of the Representatives, make
it impractical or inadvisable to proceed with the purchase and delivery of the
Shares as contemplated by the Registration Statement, as amended as of the date
hereof. References to the Registration Statement and the Prospectus in this
paragraph (d) with respect to either letter referred to above shall include any
amendment or supplement thereto at the date of such letter.
(e) The Company shall have furnished or caused to be furnished to the
Underwriters at the Closing a certificate of its Chairman of the Board, its
President or its Chief Executive Officer and its Chief Financial Officer
satisfactory to the Underwriters to the effect that:
(i) the representations and warranties of the Company in this
Agreement are true and correct as if made on and as of the Closing
Date; the Registration Statement, as amended as of the Closing
Date, does not include any untrue statement of a material fact or
omit to state any material fact necessary to make the statements
therein not misleading, and the Prospectus, as amended or
supplemented as of the Closing Date, does not include any untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; and
the Company has performed all covenants and agreements and
satisfied all conditions on its part to be performed or satisfied
at or prior to the Closing Date;
-27-
29
(ii) no stop order suspending the effectiveness of the
Registration Statement or any amendment thereto has been issued,
and no proceedings for that purpose have been instituted or
threatened or, to the best of the Company's knowledge, are
contemplated by the Commission; and
(iii) subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, neither
the Company nor any of its subsidiaries has sustained any material
loss or interference with their respective businesses 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 to his
knowledge there has not been any materially adverse change
(including, without limitation, a change in management or
control), or development involving a prospective materially
adverse change, in the condition (financial or otherwise),
management, earnings, properties, business affairs or business
prospects, stockholders' equity, net worth or results of
operations of the Company or any of its subsidiaries, except in
each case as described in or contemplated by the Prospectus
(exclusive of any amendment or supplement thereto).
(f) The Representatives shall have received from each person who is a
director or officer of the Company or who owns more than 1% of the outstanding
shares of Common Stock an agreement dated on or before the date of this
Agreement to the effect that such person will not publicly announce any
intention to and will not, without the prior written consent of the
Representatives on behalf of the Underwriters, (i) offer, pledge, sell, offer to
sell, contract to sell, sell any option or contract to purchase, purchase any
option to sell, grant any option right or warrant to purchase, or otherwise
transfer or dispose of, directly or indirectly, any of the shares of Common
Stock or any securities convertible into, or exercisable or exchangeable for,
Common Stock, or (ii) enter into any swap or other agreement that transfers, in
whole or in part, any of the economic consequences of ownership of the shares of
Common Stock or any securities convertible into, or exercisable or exchangeable
for, shares of Common Stock (whether any such transaction described in clause
(i) or (ii) above is to be settled by delivery of shares of Common Stock or such
other securities, in cash or otherwise), in each case, beneficially owned
(within the meaning of Rule 13d-3 under the Exchange Act) or otherwise
controlled by such person on the date hereof or hereafter acquired, for a period
beginning from the date hereof and continuing to and including the date 180 days
after the date hereof; provided, however, that such person may, without the
prior written consent of the Representatives on behalf of the Underwriters,
transfer shares of Common Stock or such other securities to members of such
person's immediate family or to trusts for the benefit of members of such
person's immediate family or in connection with bona fide gifts, provided that
any transferee agrees to the transfer restrictions described above.
(g) Prior to the commencement of the Offering, the Company shall have
made an application for the quotation of the Shares on the Nasdaq National
Market and the Shares shall
-28-
30
have been included for trading on the Nasdaq National Market, subject to
official notice of issuance.
(h) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date, there shall not have occurred any downgrading, nor
shall any notice have been given of any intended or potential downgrading or of
any review for a possible change that does not indicate the direction of the
possible change, in the rating accorded any of the Company's securities by any
"nationally recognized statistical rating organization", as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act.
(i) On or before the Closing Date, the Representatives and counsel for
the Underwriters shall have received such further certificates, documents or
other information as they may have reasonably requested from the Company.
All opinions, certificates, letters and documents delivered pursuant
to this Agreement will comply with the provisions hereof only if they are
satisfactory in all material respects to the Representatives and counsel for the
Underwriters. The Company shall furnish to the Representatives such conformed
copies of such opinions, certificates, letters and documents in such quantities
as the Representatives and counsel for the Underwriters shall reasonably
request.
The respective obligations of the several Underwriters to purchase and
pay for any Shares shall be subject, in their discretion, to each of the
foregoing conditions to purchase the Shares, except that all references therein
to the Shares and the Closing Date shall be deemed to refer to the Firm Shares
or the Option Shares and the First Closing Date or the related Option Closing
Date, each as applicable.
Section 8. Default of Underwriters. If, at the First Closing, any one or more of
the Underwriters shall fail or refuse to purchase Shares that it has or they
have agreed to purchase hereunder on such date, and the aggregate number of
Shares which such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase is ten percent or less of the aggregate number of the Shares
to be purchased on such date, the other Underwriters may make arrangements
satisfactory to the Representatives for the purchase of such Shares by other
persons (who may include one or more of the non-defaulting Underwriters,
including the Representatives), but if no such arrangements are made by the
First Closing Date, the other Underwriters shall be obligated severally in the
proportions that the number of Firm Shares set forth opposite their respective
names in Schedule 1 hereto bears to the aggregate number of Firm Shares set
forth opposite the names of all such non-defaulting Underwriters, or in such
other proportions as the Representatives may specify, to purchase the Shares
which such defaulting Underwriter or Underwriters agreed but failed or refused
to purchase on such date. If, at the First Closing, any Underwriter or
Underwriters shall fail or refuse to purchase Firm Shares and the aggregate
number of Firm Shares with respect to which such default occurs is more than ten
per cent of the aggregate number of Firm Shares to be purchased, and
arrangements satisfactory to the Representatives and the Company for the
purchase of such Firm Shares are not made within 36 hours after such default,
this Agreement shall terminate without liability on the part of any
-29-
31
non-defaulting Underwriter or the Company. In any such case either the
Representatives or the Company shall have the right to postpone the Closing, but
in no event for longer than seven days, in order that the required changes, if
any, in the Registration Statement and in the Prospectus or in any other
documents or arrangements may be effected. If, at any Option Closing, any
Underwriter or Underwriters shall fail or refuse to purchase Option Shares, the
non-defaulting Underwriters shall have the option to (i) terminate their
obligation hereunder to purchase Option Shares or (ii) purchase not less than
the number of Option Shares that such non-defaulting Underwriters would have
been obligated to purchase in the absence of such default. As used in this
Agreement, the term "Underwriter" includes any person substituted for an
Underwriter under this Section 8. Any action taken under this Section 8 shall
not relieve any defaulting Underwriter from liability in respect of any default
of such Underwriter under this Agreement.
Section 9. Termination. This Agreement shall be subject to termination in the
sole discretion of the Representatives by notice to the Company given prior to
any Closing Date in the event that the Company shall have failed, refused or
been unable to perform all obligations and satisfy all conditions on its part to
be performed or satisfied hereunder at or prior thereto or, if at or prior to
any Closing Date, (a) trading in securities generally on the New York Stock
Exchange or the Nasdaq National Market shall have been suspended or materially
limited or minimum or maximum prices shall have been established by or on, as
the case may be, the Commission or the New York Stock Exchange or the Nasdaq
National Market; (b) trading of any securities of the Company shall have been
suspended on any exchange or in any over-the-counter market; (c) a general
moratorium on commercial banking activities shall have been declared by either
Federal or Delaware authorities; (d) there shall have occurred (i) an outbreak
or escalation of hostilities between the United States and any foreign power,
(ii) an outbreak or escalation of any other insurrection or armed conflict
involving the United States, or (iii) any other calamity or crisis or materially
adverse change in general economic, political or financial conditions having an
effect on the U.S. financial markets that, in the sole judgment of the
Representatives, makes it impractical or inadvisable to proceed with the public
offering or the delivery of the Shares as contemplated by the Registration
Statement, as amended as of the date hereof; or (e) the Company or any of its
subsidiaries shall have, in the sole judgment of the Representatives, sustained
any material loss or interference with their respective businesses 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,
or there shall have been any materially adverse change (including, without
limitation, a change in management or control), or constitute a development
involving a prospective materially adverse change, in the condition (financial
or otherwise), management, earnings, properties, business affairs or business
prospects, stockholders' equity, net worth or results of operations of the
Company or any of its subsidiaries, except in each case as described in or
contemplated by the Prospectus (exclusive of any amendment or supplement
thereto). Termination of this Agreement pursuant to this Section 9 shall be
without liability of any party to any other party except for the liability of
the Company in relation to expenses as provided in Sections 4 and 10 hereof, the
indemnity provided in Section 6 hereof and any liability arising before or in
relation to such termination.
Section 10. Reimbursement of Expenses. If the sale of the Shares provided for
herein is not consummated because any condition to the obligations of the
Underwriters set forth in Section 7
-30-
32
hereof is not satisfied or because of any termination pursuant to Section 9
hereof (other than by reason of a default by any of the Underwriters), the
Company shall reimburse the Underwriters, severally upon demand, for all
out-of-pocket expenses (including fees and disbursements of counsel) that shall
have been incurred by them in connection with the proposed purchase and sale of
the Shares.
Section 11. Information Supplied by Underwriters. The statements set forth in
[the last paragraph on the front cover page and under the heading "Underwriting"
in any Preliminary Prospectus or the Prospectus] (to the extent such statements
relate to the Underwriters) constitute the only information furnished by any
Underwriter through the Representatives to the Company for the purposes of
Section 5(a)(ii) and Section 6 hereof. The Underwriters confirm that such
statements (to such extent) are correct.
Section 12. Notices. In all dealings hereunder, you shall act on behalf of each
of the Underwriters, and the parties hereto shall be entitled to act and rely
upon any statement, request, notice or agreement on behalf of any Underwriter
made or given by the Representatives. Any notice or notification in any form to
be given under this Agreement may be delivered in person or sent by telex,
facsimile or telephone (subject in the case of a communication by telephone to
confirmation by telex or facsimile) addressed to:
in the case of the Company:
▇▇▇▇▇▇▇▇.▇▇▇ Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Executive Officer
in the case of the Underwriters:
Deutsche ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.
Any such notice shall take effect, in the case of delivery, at the time of
delivery and, in the case of telex or facsimile, at the time of dispatch.
Section 13. Miscellaneous.
(a) Time shall be of the essence of this Agreement.
(b) The headings herein are inserted for convenience of reference only
and are not intended to be part of, or to affect, the meaning or interpretation
of this Agreement.
-31-
33
(c) For purposes of this Agreement, (a) "business day" means any day
on which the New York Stock Exchange is open for trading, and (b) "subsidiary"
has the meaning set forth in Rule 405 under the Securities Act.
(d) This Agreement may be executed in any number of counterparts, all
of which, taken together, shall constitute one and the same Agreement and any
party may enter into this Agreement by executing a counterpart.
(e) This Agreement shall inure to the benefit of and shall be binding
upon the several Underwriters, the Company and their respective successors and
legal representatives, and nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any other person any legal or equitable
right, remedy or claim under or in respect of this Agreement, or any provisions
herein contained, this Agreement and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of such persons and
for the benefit of no other person, except that (i) the indemnities of the
Company contained in Section 6 hereof shall also be for the benefit of any
person or persons who control any Underwriter within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act and (ii) the indemnities
of the Underwriters contained in Section 6 hereof shall also be for the benefit
of the directors of the Company, the officers of the Company who have signed the
Registration Statement and any person or persons who control the Company within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act. No purchaser of Shares from any Underwriter shall be deemed a successor
because of such purchase.
(f) The respective representations, warranties, agreements, covenants,
indemnities and other statements of the Company, its officers and the several
Underwriters set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement shall remain in full force and effect,
regardless of (i) any investigation made by or on behalf of the Company, any of
its officers or directors, any Underwriter or any controlling person referred to
in Section 6 hereof and (ii) delivery of and payment for the Shares. The
respective agreements, covenants, indemnities and other statements set forth in
Sections 4, 6 and 10 hereof shall remain in full force and effect, regardless of
any termination or cancellation of this Agreement.
Section 14. Severability. It is the desire and intent of the parties that the
provisions of this Agreement be enforced to the fullest extent permissible under
the law and public policies applied in each jurisdiction in which enforcement is
sought. Accordingly, in the event that any provision of this Agreement would be
held in any jurisdiction to be invalid, prohibited or unenforceable for any
reason, such provision, as to such jurisdiction, shall be ineffective, without
invalidating the remaining provisions of this Agreement or affecting the
validity or enforceability of such provision in any other jurisdiction.
Section 15. Governing Law. The validity and interpretation of this Agreement,
and the terms and conditions set forth herein, shall be governed by and
construed in accordance with the laws of the State of New York, without giving
effect to any provisions relating to conflicts of laws.
-32-
34
If the foregoing is in accordance with your understanding, please sign
and return to us six (6) counterparts hereof, and upon the acceptance hereof by
you, on behalf of each of the Underwriters, this letter and such acceptance
hereof shall constitute a binding agreement among each of the Underwriters and
the Company. It is understood that your acceptance of this letter on behalf of
each of the Underwriters is pursuant to the authority set forth in the Deutsche
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc. Master Agreement Among Underwriters, the form of which
shall be submitted to the Company for examination upon request, but without
warranty on your part as to the authority of the signers thereof.
Very truly yours,
▇▇▇▇▇▇▇▇.▇▇▇ Corporation
By____________________________________
Name:
Title:
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
DEUTSCHE ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ INC.
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ SECURITIES CORPORATION
▇.▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
By: DEUTSCHE ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ INC.
By____________________________________
Name:
Title:
For itself and on behalf of the Representatives.
-33-
35
SUBJECT TO NEGOTIATION.
SCHEDULE 1
The Underwriters
Underwriter Underwriting commitment
Deutsche ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc..................................
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities Corp...................
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. ..........................................
▇. ▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ...................................... ____________________
Total......................................................... 5,000,000
