EXHIBIT 1.1
XXXXXXX.XXX, INC.
7,750,000 Shares*
Common Stock
UNDERWRITING AGREEMENT
________ ___, 1999
PRUDENTIAL SECURITIES INCORPORATED
U.S. BANCORP XXXXX XXXXXXX INC.
FIRST ALBANY CORPORATION
E*OFFERING CORP.
As Representatives of the several Underwriters
c/o Prudential Securities Incorporated
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
XXXxxxx.xxx, Inc., a Delaware corporation (the "Company"), and HyperFeed
Technologies Inc., a Delaware corporation (the "Selling Securityholder"), hereby
confirm their agreement with the several underwriters named in Schedule 1 hereto
(the "Underwriters"), for whom you have been duly authorized to act as
representatives (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 to the Underwriters.
1. SECURITIES. Subject to the terms and conditions herein contained, the
Company proposes to issue and sell to the several Underwriters 5,800,000 shares
(the "Company Firm Securities") of the Company's Common Stock, par value $0.01
per share ("Common Stock"), and the Selling Securityholder proposes to sell to
the several Underwriters 1,950,000 authorized and outstanding shares of Common
Stock (the "Selling Securityholder Firm Securities" and together with the
Company Firm Securities, the "Firm Securities"). The Company also proposes to
issue
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* Plus options to purchase from the Company up to 387,500 additional shares and
from the Selling Securityholder up to 775,000 additional shares to cover
over-allotments.
and sell, and the Selling Securityholder proposes to sell, to the several
Underwriters up to 1,162,500 additional shares of Common Stock in the aggregate
if requested by the Representatives as provided in Section 3 of this Agreement.
Any and all shares of Common Stock to be purchased by the Underwriters pursuant
to such options are referred to herein as the "Option Securities," and the Firm
Securities and any Option Securities are collectively referred to herein as the
"Securities."
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SELLING
SECURITYHOLDER. The Company and the Selling Securityholder, jointly and
severally, represent and warrant to, and agree with, each of the several
Underwriters that:
(a) A registration statement on Form S-1 (File No. 333-80335) with
respect to the Securities, including a prospectus subject to completion,
has been filed by the Company with the Securities and Exchange Commission
(the "Commission") under the Securities Act of 1933, as amended (the
"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 (i) if such registration statement, as it may
have been amended, has been declared by the Commission to be effective
under the Act, either (A) if the Company relies on Rule 434 under the Act,
a Term Sheet (as hereinafter defined) relating to the Securities, that
shall identify the Preliminary Prospectus (as hereinafter defined) that it
supplements containing such information as is required or permitted by
Rules 434, 430A and 424(b) under the Act or (B) if the Company does not
rely on Rule 434 under the 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 Act or
permitted by Rule 424(b) under the Act, and in the case of either clause
(i)(A) or (i)(B) of this sentence as have been provided to and approved by
the Representatives prior to the execution of this Agreement, or (ii) if
such registration statement, as it may have been amended, has not been
declared by the Commission to be effective under the 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
related registration statement with the Commission pursuant to Rule 462(b)
under the Act for the purpose of registering certain additional Securities,
which registration shall be effective upon filing with the Commission. As
used in this Agreement, the term "Original Registration Statement" means
the registration statement initially filed relating to the Securities, 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 Act and included in the
Prospectus (as hereinafter defined); the term "Rule 462(b) Registration
Statement" means any registration statement filed with the Commission
pursuant to Rule 462(b) under the Act (including the
Registration Statement and any Preliminary Prospectus 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 such registration statement or any amendment thereto (including the
prospectus subject to completion, if any, included in the Registration
Statement or any amendment thereto at the time it was or is declared
effective); the term "Prospectus" means:
(A) if the Company relies on Rule 434 under the Act, the Term Sheet
relating to the Securities that is first filed pursuant to Rule
424(b)(7) under the Act, together with the Preliminary Prospectus
identified therein that such Term Sheet supplements;
(B) if the Company does not rely on Rule 434 under the Act, the prospectus
first filed with the Commission pursuant to Rule 424(b) under the Act;
or
(C) if the Company does not rely on Rule 434 under the Act and if no
prospectus is required to be filed pursuant to Rule 424(b) under the
Act, the prospectus included in the Registration Statement;
and the term "Term Sheet" means any term sheet that satisfies the
requirements of Rule 434 under the Act. Any reference herein to the "date"
of a Prospectus that includes a Term Sheet shall mean the date of such Term
Sheet.
(b) The Commission has not issued any order preventing or suspending
use of any Preliminary Prospectus. When any Preliminary Prospectus was
filed with the Commission it (i) contained all statements required to be
stated therein in accordance with, and complied in all material respects
with the requirements of, the Act and the rules and regulations of the
Commission thereunder and (ii) 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 Act
and the rules and regulations of the Commission thereunder and (ii) did not
or will not include any untrue statement of a material fact or omit to
state any material fact 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 part thereof or such
amendment or supplement is not required to be so filed, when the
Registration Statement or the amendment thereto containing such amendment
or supplement to the Prospectus was or is declared effective) and on the
Firm Closing Date and any Option Closing Date (both
as hereinafter defined), the Prospectus, as amended or supplemented at
any such time, (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 Act and the rules and
regulations of the Commission thereunder and (ii) 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 (b) 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.
(c) If the Company has elected to rely on Rule 462(b) and the Rule
462(b) Registration Statement has not been declared effective (i) the
Company has filed a Rule 462(b) Registration Statement in compliance with
and that is effective upon filing pursuant to Rule 462(b) and has received
confirmation of its receipt and (ii) 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 promulgated under the Act or the Commission has received
payment of such filing fee.
(d) The Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Delaware and is
duly qualified to transact business as a foreign corporation and is in good
standing under the laws of all other jurisdictions where the ownership or
leasing of its properties 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.
(e) The Company has full power (corporate and other) to own or lease
its properties and conduct its business as described in the Registration
Statement and the Prospectus or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus; and the Company has full power
(corporate and other) to enter into this Agreement and to carry out all the
terms and provisions hereof to be carried out by it.
(f) The Company has an authorized, issued and outstanding
capitalization as set forth in the Prospectus or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus. All of the issued
shares of capital stock of the Company, including the Selling
Securityholder Firm Securities and the Option Securities to be sold by the
Selling Securityholder, have been duly authorized and validly issued and
are fully paid and nonassessable. The Company Firm Securities to be sold by
the Company and the Option Securities to be sold by the Company have been
duly authorized and at the Firm Closing Date or the related Option Closing
Date (as the case may be), after payment therefor in accordance herewith,
will be validly issued, fully paid and nonassessable. No holder of
outstanding shares of capital stock of the Company is entitled as such to
any preemptive or other rights to subscribe for any of the Securities, 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 Act in the public offering contemplated by this
Agreement.
(g) The capital stock of the Company conforms to the description
thereof contained in the Prospectus or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus.
(h) Except as disclosed in the Prospectus (or, if the Prospectus is
not in existence, the most recent Preliminary Prospectus), there are no
outstanding (A) securities or obligations of the Company convertible into
or exchangeable for any capital stock of the Company, (B) warrants, rights
or options to subscribe for or purchase from the Company any such capital
stock or any such convertible or exchangeable securities or obligations, or
(C) obligations of the Company to issue any shares of capital stock, any
such convertible or exchangeable securities or obligations, or any such
warrants, rights or options.
(i) The financial statements and schedules of the Company included in
the Registration Statement and the Prospectus (or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus) fairly present the
financial position of the Company and the results of operations and changes
in financial condition as of the dates and periods therein specified. Such
financial statements and schedules have been prepared in accordance with
generally accepted accounting principles consistently applied throughout
the periods involved (except as otherwise noted therein). The selected
financial data set forth under the caption "Selected Financial Data" in the
Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus) fairly present, on the basis stated in the
Prospectus (or such Preliminary Prospectus), the information included
therein. The pro forma statement of operations data of the Company together
with the related notes thereto included under the caption "Pro Forma
Financial Information" and elsewhere in the Registration Statement and the
Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus) present fairly the information contained therein,
have been prepared in accordance with the Commission's rules and guidelines
with respect to pro forma financial statements and have been properly
presented on the pro forma basis described therein, and the assumptions
used in the preparation thereof are reasonable and the adjustments used
therein are appropriate to give effect to the transactions and
circumstances referred to therein.
(j) KPMG LLP, who have certified certain financial statements of the
Company and delivered their report with respect to the audited financial
statements and schedules included in the Registration Statement and the
Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary Prospectus), are independent public accountants as required by
the Act and the applicable rules and regulations thereunder.
(k) The execution and delivery of this Agreement have been duly
authorized by 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 enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by
general equitable principles.
(l) The execution and delivery of the Contribution and Separation
Agreement, the Services Agreement, the Non-Competition Agreement, the
DataFeed License Agreement (the "DataFeed License Agreement"), the
Maintenance Agreement, the Registration Rights Agreement (the "Registration
Rights Agreement") and the Tax Indemnification and Allocation Agreement
(collectively, the "Intercompany Agreements") have been duly authorized by
the Company and the Intercompany Agreements will be duly executed and
delivered by the Company on or prior to the Firm Closing Date, and will be
the valid and binding agreements of the Company enforceable against the
Company in accordance with their terms, except as rights to indemnification
and contribution under the Registration Rights Agreement may be limited by
applicable law and except as the enforcement of any such agreement may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the rights and remedies of creditors
or by general equitable principles.
(m) Following the consummation of the transactions contemplated by
the Intercompany Agreements, Company will own or have rights to use all
properties and assets, both real and personal, tangible and intangible,
necessary or appropriate for the conduct of its business as described in
the Prospectus.
(n) No legal or governmental proceedings are pending to which the
Company is a party or to which the property of the Company is subject that
are required to be described in the Registration Statement or the
Prospectus and are not described therein (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus), and no such proceedings
have been threatened against the Company or with respect to any of its
properties; and no contract or other document is required to be described
in the Registration Statement or the Prospectus or to be filed as an
exhibit to the Registration Statement that is not described therein (or, if
the Prospectus is not in existence, the most recent Preliminary Prospectus)
or filed as required.
(o) The issuance, offering and sale of the Securities to the
Underwriters pursuant to this Agreement, the compliance by the Company with
the other provisions of this Agreement, the consummation of the other
transactions herein contemplated and the compliance by the Company with the
provisions of the Intercompany Agreements do not (i) require the consent,
approval, authorization, registration or qualification of or with any
governmental authority, except such as have been obtained or are required
under applicable Blue Sky laws, and, if the registration statement filed
with respect to the Securities (as amended) is not effective under the Act
as of the time of execution hereof, such as may be required (and shall be
obtained as provided in this Agreement) under the Act or under applicable
Blue Sky laws, or (ii) 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 is a
party or by which the Company or any of its properties are bound, or the
charter documents or by-laws of the Company, 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 .
(p) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus, the
Company has not sustained any material loss or interference with its
business or properties from fire, flood, hurricane, accident or other
calamity, whether or not covered by insurance, or from any labor dispute or
any legal or governmental proceeding and there has not been any material
adverse change, or any development involving a prospective material adverse
change, in the condition (financial or otherwise), management, business
prospects, net worth, or results of the operations of the Company, except
in each case as described in or contemplated by the Prospectus or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus.
(q) The Company has not, directly or indirectly, (i) 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 or the Selling Securityholder to
facilitate the sale or resale of the Securities or (ii) since the filing of
the Registration Statement (A) sold, bid for, purchased, or paid anyone any
compensation for soliciting purchases of, the Securities or (B) paid or
agreed to pay to any person any compensation for soliciting another to
purchase any other securities of the Company or the Selling Securityholder.
(r) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus (or, if the
Prospectus is not in existence, the most recent Preliminary Prospectus),
(1) the Company has not incurred any material liability or obligation,
direct or contingent, nor entered into any material transaction not in the
ordinary course of business; (2) 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 (3) there
has not been any material change in the capital stock, short-term debt or
long-term debt of the Company, except in each case as described in or
contemplated by the Prospectus (or, if the Prospectus is not in existence,
the most recent Preliminary Prospectus).
(s) The Company does not own any real property. The Company has good
and marketable title to all personal property owned by it, free and clear
of any security interests, liens, encumbrances, equities, claims and other
defects, except for the security interest of Lakeside Bank and except 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 and do not interfere with the use made or proposed to be made
of such property by the Company, and any real property and buildings
held under lease by the Company 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 and except as enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by
general equitable principles, in each case except as described in or
contemplated by the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus).
(t) No labor dispute with the employees of the Company exists or is
threatened or imminent that could result in a material adverse change in
the condition (financial or otherwise), business prospects, net worth or
results of operations of the Company, except as described in or
contemplated by the Prospectus (or, if the Prospectus is not in existence,
the most recent Preliminary Prospectus).
(u) The Company owns or possesses all material patents, patent
applications, trademarks, service marks, trade names, licenses, copyrights
and proprietary or other confidential information currently employed by it
in connection with its business, including, without limitation, all rights
to the names PCQuote and XXXxxxx.xxx, and the Company has not 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 result in a material adverse change in the condition (financial or
otherwise), business prospects, net worth or results of operations of the
Company, except as described in or contemplated by the Prospectus (or, if
the Prospectus is not in existence, the most recent Preliminary
Prospectus).
(v) The Company is 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 it is engaged; the Company
has not been refused any insurance coverage sought or applied for; and the
Company does not have 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), business prospects, net
worth or results of operations of the Company, except as described in or
contemplated by the Prospectus (or, if the Prospectus is not in existence,
the most recent Preliminary Prospectus).
(w) The Company possesses all certificates, authorizations and
permits issued by the appropriate federal, state or foreign regulatory
authorities necessary to conduct its business, and the Company has not
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 result in a material adverse change in the condition
(financial or otherwise), business prospects, net worth or results of
operations of the Company, except as described in or contemplated by the
Prospectus (or, if the Prospectus is not in existence, the most recent
Preliminary
Prospectus).
(x) The Company will conduct its operations in a manner that will not
subject it to registration as an investment company under the Investment
Company Act of 1940, as amended, and this transaction will not cause the
Company to become an investment company subject to registration under such
Act.
(y) Each of the Company, the Selling Securityholder and any
subsidiary of the Selling Securityholder 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 material adverse effect on the Company or the Selling
Securityholder) 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 (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus).
(z) The Company is not 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
has received all permits, licenses or other approvals required of it under
applicable federal and state occupational safety and health and
environmental laws and regulations to conduct its business, and the Company
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, result in a material adverse change
in the condition (financial or otherwise), business prospects, net worth or
results of operations of the Company, except as described in or
contemplated by the Prospectus (or, if the Prospectus is not in existence,
the most recent Preliminary Prospectus).
(aa) Each certificate signed by an officer of the Company and
delivered to the Representatives or counsel for the Underwriters shall be
deemed to be a representation and warranty by the Company to each
Underwriter as to the matters covered thereby.
(ab) The Company does not own any shares of stock or any other equity
securities of any corporation or have any equity interest in any firm,
company, partnership, association or other entity.
(ac) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurance that (1) transactions are
executed in accordance with management's general or specific
authorizations; (2) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (3) access to
assets is permitted only in accordance with management's general or
specific authorization; and (4) the
recorded accountability for assets is compared with the existing assets
at reasonable intervals and appropriate action is taken with respect to
any differences.
(ad) 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 is a party or by which the Company or any of its properties is
bound or may be affected except for any such defaults which would not, in
the aggregate, have a material adverse effect upon the property, business
or operations of the Company.
(ae) The Company has not distributed and, prior to the later of (i)
the Closing Date and (ii) the completion of the distribution of the
Securities, will not distribute any offering material in connection with
the offering and sale of the Securities other than the Registration
Statement or any amendment thereto, any Preliminary Prospectus or the
Prospectus or any amendment or supplement thereto, or other materials, if
any permitted by the Act.
2A. REPRESENTATIONS AND WARRANTIES OF THE SELLING SECURITYHOLDER. The
Selling Securityholder represents and warrants to, and agrees with, each of the
several Underwriters that:
(a) The Selling Securityholder has full power (corporate and other)
to enter into this Agreement, to sell, assign, transfer and deliver to the
Underwriters the Securities to be sold by the Selling Securityholder
hereunder in accordance with the terms of this Agreement and the full power
(corporate and other) to enter into the Intercompany Agreements; and this
Agreement has been duly executed and delivered by the Selling
Securityholder and constitutes the legal, valid and binding agreement of
the Selling Securityholder, and the Intercompany Agreements, upon execution
and delivery thereof by the Company and the Selling Securityholder, will
constitute the legal and valid binding obligations of the Selling
Securityholder, in each case enforceable in accordance with its terms,
except as rights to indemnification and contribution under the Registration
Rights Agreement may be limited by applicable law and except as the
enforcement of any such agreement may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting
the rights and remedies of creditors or by general equitable principles.
(b) The Selling Securityholder is the lawful owner of the Securities
to be sold by the Selling Securityholder hereunder and upon sale and
delivery of, and payment for, such Securities, as provided herein, the
Selling Securityholder will convey good and marketable title to such
Securities, free and clear of any security interests, liens, encumbrances,
equities, claims or other defects.
(c) The Selling Securityholder has not, directly or indirectly, (i)
taken any action designed to cause or 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 or the Selling
Securityholder to facilitate the sale or resale of the Securities or (ii)
since the filing of the Registration Statement (A) sold, bid for,
purchased, or paid anyone any compensation for soliciting purchases of, the
Securities or (B) paid or agreed to pay to any person any compensation for
soliciting another to purchase any other securities of the Company or the
Selling Securityholder.
(d) To the extent that any statements or omissions are made in the
Registration Statement, 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 the Selling Securityholder
specifically for use therein, such Preliminary Prospectus did, and the
Registration Statement and the Prospectus and any amendments or supplements
thereto, when they become effective or are filed with the Commission, as
the case may be, will conform in all material respects to the requirements
of the Act, the Exchange Act and the respective rules and regulations of
the Commission thereunder and 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, in the light of the
circumstances under which they are made, not misleading. The Selling
Securityholder has reviewed the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus) and the Registration
Statement, and the information regarding the Selling Securityholder set
forth therein is complete and accurate.
(e) The sale of the Securities by the Selling Securityholder pursuant
hereto is not prompted by any adverse information concerning the Company
that is not set forth in the Registration Statement or the Prospectus (or,
if the Prospectus is not in existence, the most recent Preliminary
Prospectus).
(f) The sale of the Securities to the Underwriters by the Selling
Securityholder pursuant to this Agreement, the compliance by the Selling
Securityholder with the provisions of this Agreement, the consummation of
the other transactions herein contemplated and the compliance by the
Selling Securityholder with the provisions of the Intercompany Agreements
do not (i) require the consent, approval, authorization, registration or
qualification of or with any governmental authority, except such as have
been obtained or are required under applicable Blue Sky laws and, if the
Registration Statement filed with respect to the Securities (as amended) is
not effective under the Act as of the time of execution hereof, such as may
be required (and shall be obtained as provided in this Agreement) under the
Act or under applicable Blue Sky laws, or (ii) 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 Selling Securityholder is a party or
by which the Selling Securityholder or any of its properties are bound, or
any statute or any judgment, decree, order, rule or regulation of any court
or other governmental authority or any arbitrator applicable to the Selling
Securityholder, except for such conflicts, breaches or violations which
would not, in the
aggregate, have a material adverse effect upon the property, business or
obligations of the Selling Securityholder.
(g) The Selling Securityholder has not distributed and, prior to the
later of (i) the Closing Date and (ii) the completion of the distribution
of the Securities, will not distribute any offering material in connection
with the offering and sale of the Securities other than the Registration
Statement or any amendment thereto, and Preliminary Prospectus or the
Prospectus or any amendment or supplement thereto, or other materials, if
any, permitted by the Act.
(h) The transactions contemplated hereby will not cause the Selling
Securityholder to become an investment company subject to the registration
under the Investment Company Act.
(i) Each certificate signed by any officer of the Selling
Securityholder and delivered to the Representatives or counsel for the
Underwriters shall be deemed to be a representation and warranty by the
Selling Securityholder to each Underwriter as to the matters covered
thereby.
(j) Each of the Company, the Selling Securityholder and any
subsidiary of the Selling Securityholder 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 material adverse effect on the Company or the Selling
Securityholder) 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 (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus).
3. PURCHASE, SALE AND DELIVERY OF THE SECURITIES. (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 the Company Firm Securities and the Selling Securityholder agrees
to sell the Selling Securityholder Firm Securities to the Underwriters, and each
of the Underwriters, severally and not jointly, agrees to purchase from the
Company and the Selling Securityholder, at a purchase price of $________ per
share, the number of Firm Securities set forth opposite the name of such
Underwriter in Schedule 1 hereto. The number of Firm Securities to be purchased
from the Company and the Selling Securityholder, respectively (as adjusted by
the Representatives to avoid fractions), by each of the Underwriters shall be
determined by multiplying the aggregate number of such Firm Securities to be
sold by the Company or the Selling Securityholder, as the case may be, by a
fraction, the numerator of which is the number of Firm Securities, set forth
opposite the name of such Underwriter on Schedule 1 hereto and the denominator
of which is the total number of Firm Securities set forth on Schedule 1 hereto.
One or more certificates in definitive form for the Firm Securities that the
several Underwriters have agreed to purchase hereunder, and in such denomination
or denominations and registered in such name or names as the Representatives
request upon notice to the Company and
the Selling Securityholder at least 48 hours prior to the Firm Closing Date,
shall be delivered by or on behalf of the Company and the Selling
Securityholder to the Representatives for the respective accounts of the
Underwriters, against payment by or on behalf of the Underwriters of the
purchase price therefor by wire transfer in same- day funds (the "Wired
Funds") to the respective accounts of the Company and the Selling
Securityholder. Such delivery of and payment for the Firm Securities shall be
made at the offices of Wildman, Harrold, Xxxxx & Xxxxx, Chicago, Illinois, at
8:30 A.M., Chicago time, on __________, 1999, or at such other place, time or
date as the Representatives, the Company and the Selling Securityholder may
agree upon or as the Representatives may determine pursuant to Section 9
hereof, such time and date of delivery against payment being herein referred
to as the "Firm Closing Date". Each of the Company and the Selling
Securityholder severally will make such certificate or certificates for the
Firm Securities 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 Prudential Securities Incorporated at least 24 hours prior to
the Firm Closing Date.
(b) For the purpose of covering any over-allotments in connection with the
distribution and sale of the Firm Securities as contemplated by the Prospectus,
the Company and the Selling Securityholder hereby grant to the several
Underwriters options to purchase, severally and not jointly, the Option
Securities in the respective amounts of 387,500 shares and 775,000 shares. The
purchase price to be paid for any Option Securities shall be the same price per
share as the price per share for the Firm Securities set forth above in
paragraph (a) of this Section 3. The options granted hereby may be exercised as
to all or any part of the Option Securities from time to time within thirty (30)
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 is open for trading). The Underwriters shall not be under any
obligation to purchase any of the Option Securities prior to the exercise of
such options. The Representatives may from time to time exercise the options
granted hereby by giving notice in writing or by telephone (confirmed in
writing) to the Company and the Selling Securityholder setting forth the
aggregate number of Option Securities as to which the several Underwriters are
then exercising the options and the date and time for delivery of and payment
for such Option Securities. Any such date of delivery 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 options and, in any event, shall
not be earlier than the Firm Closing Date. The time and date set forth in such
notice, or such other time on such other date as the Representatives, the
Company and the Selling Securityholder may agree upon or as the Representatives
may determine pursuant to Section 9 hereof, is herein called the "Option Closing
Date" with respect to such Option Securities. Upon exercise of the options as
provided herein, the Company shall become obligated to issue and sell and the
Selling Securityholder shall become obligated to sell to each of the several
Underwriters, 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 and the Selling Securityholder, the same percentage of the
total number of the Option Securities as to which the several Underwriters are
then exercising the options as such Underwriter is obligated to purchase of the
aggregate number of Firm Securities,
as adjusted by the Representatives in such manner as they deem advisable to
avoid fractional shares. Any partial exercise of the options granted hereby
shall be made on a pro rata basis in proportion to the respective maximum
number of Option Securities to be sold by each of the Company and the Selling
Securityholder as set forth herein. If the options are exercised as to all or
any portion of the Option Securities, one or more certificates in definitive
form for such Option Securities, and payment therefor, shall be delivered on
the related Option Closing Date in the manner, and upon the terms and
conditions, set forth in paragraph (a) of this Section 3, except that
reference therein to the Firm Securities and the Firm Closing Date shall be
deemed, for purposes of this paragraph (b), to refer to such Option
Securities and Option Closing Date, respectively.
(c) Each of the Company and the Selling Securityholder hereby acknowledges
that the wire transfer by or on behalf of the Underwriters of the purchase price
for any Securities does not constitute closing of a purchase and sale of the
Securities. Only execution and delivery of a receipt for Securities by the
Underwriters indicates completion of the closing of a purchase of the Securities
from the Company or the Selling Securityholder, as the case may be. Furthermore,
in the event that the Underwriters wire funds to the Company or the Selling
Securityholder prior to the completion of the closing of a purchase of
Securities, each of the Company and the Selling Securityholder hereby
acknowledges that until the Underwriters execute and deliver a receipt for the
Securities, by facsimile or otherwise, the Company or the Selling
Securityholder, as the case may be, will not be entitled to the wired funds and
shall return the wired funds 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 Securities is not completed and the wired funds are not returned by
the Company or the Selling Securityholder, as the case may be, to the
Underwriters on the same day the wired funds were received by the Company or the
Selling Securityholder, as the case may be, each of the Company and the Selling
Securityholder agrees to pay to the Underwriters in respect of each day the wire
funds are not returned by it, in same- day funds, interest on the amount of such
wire funds in an amount representing the Underwriters' cost of financing as
reasonably determined by Prudential Securities Incorporated.
(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 Securities 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. OFFERING BY THE UNDERWRITERS. Upon your authorization of the release
of the Firm Securities, the several Underwriters propose to offer the Firm
Securities for sale to the public upon the terms set forth in the Prospectus.
5. COVENANTS OF THE COMPANY AND THE SELLING SECURITYHOLDER. The Company
and the Selling Securityholder, jointly and severally, covenant and agree with
each of the Underwriters that:
(a) The Company and the Selling Securityholder will use their 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 Act. During any time when a prospectus relating to the Securities is
required to be delivered under the Act, the Company (i) will comply with all
requirements imposed upon it by the 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 Securities in accordance with the provisions
hereof and of the Prospectus, as then amended or supplemented, and (ii) will
not file with the Commission the prospectus, Term Sheet or the amendment
referred to in the second sentence of Section 2(a) hereof, any amendment or
supplement to such Prospectus, Term Sheet or any amendment to the
Registration Statement or any Rule 462(b) Registration Statement of which the
Representatives previously have been advised and furnished with a copy for a
reasonable period of time prior to the proposed filing and as to which filing
the Representatives shall not have given their reasonable consent. 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, in the opinion of counsel for the Underwriters and counsel for the
Company, be necessary or advisable in connection with the distribution of the
Securities by the several Underwriters, and will use its best efforts to
cause any such amendment to the Registration Statement to be declared
effective by the Commission as promptly as possible. 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 any amendment or supplement thereto
has been filed and will provide evidence satisfactory to the Representatives
of each such filing or effectiveness.
(b) The Company will advise the Representatives, promptly after receiving
notice or obtaining knowledge thereof, of (i) the issuance by the Commission of
any stop order suspending the effectiveness of the Original Registration
Statement or any Rule 462(b) Registration Statement or any amendment thereto or
any order preventing or suspending the use of any Preliminary Prospectus or the
Prospectus or any amendment or supplement thereto, (ii) the suspension of the
qualification of the Securities for offering or sale in any jurisdiction, (iii)
the institution, threatening or contemplation of any proceeding for any such
purpose or (iv) 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.
(c) The Company will cooperate with the Representatives and counsel for
the Underwriters for the qualification of the Securities for offering and sale
under (or obtain exemptions from the application of) the securities or blue sky
laws of such jurisdictions as the Representatives may designate and will
continue such qualifications in effect for as long as may be necessary to
complete the distribution of the Securities, PROVIDED, HOWEVER, that in
connection therewith the Company shall not be required to qualify as a foreign
corporation or to execute a general consent to service of process in any
jurisdiction.
(d) If, at any time prior to the later of (i) the final date when a
prospectus relating to the Securities is required to be delivered under the Act
or (ii) the Option Closing Date, 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 a 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 is necessary at any time to
amend or supplement the Prospectus to comply with the Act or the rules or
regulations of the Commission thereunder, the Company will promptly notify the
Representatives thereof and, subject to Section 5(a) hereof, will prepare and
file with the Commission, at the Company's expense, an amendment to the
Registration Statement or an amendment or supplement to the Prospectus that
corrects such statement or omission or effects such compliance.
(e) The Company will, without charge, provide (i) to the Representatives
and to counsel for the Underwriters a signed copy of the registration statement
originally filed with respect to the Securities and each amendment thereto (in
each case including exhibits thereto) or any Rule 462(b) Registration Statement,
certified by the Secretary or an Assistant Secretary of the Company to be true
and complete copies thereof as filed with the Commission by electronic
transmission, (ii) to each other Underwriter, a conformed copy of such
registration statement or any Rule 462(b) Registration Statement and each
amendment thereto (in each case without exhibits thereto) and (iii) so long as a
prospectus relating to the Securities is required to be delivered under the Act,
as many copies of each Preliminary Prospectus or the Prospectus or any amendment
or supplement thereto as the Representatives may reasonably request, PROVIDED,
HOWEVER, that if any such delivery is more than nine (9) months after the
effective date of the Registration Statement, the costs (printing and other) of
such delivery shall be at the expense of the requesting Underwriter(s); without
limiting the application of clause (iii) of this sentence, the Company, not
later than (A) 6:00 PM, New York City time, on the date of determination of the
public offering price, if such determination occurred at or prior to 10:00 A.M.,
New York City time, on such date or (B) 2:00 PM, New York City time, on the
business day following the date of determination of the public offering price,
if such determination occurred after 10:00 A.M., 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 Firm Closing Date.
(f) The Company, as soon as practicable, will make generally available to
its securityholders and to the Representatives an earnings statement of the
Company that satisfies the provisions of Section 11(a) of the Act and Rule 158
thereunder.
(g) The Company will apply the net proceeds from the sale of the
Securities as set forth under "Use of Proceeds" in the Prospectus.
(h) The Company will not, directly or indirectly, without the prior
written consent of Prudential Securities Incorporated, on behalf of the
Underwriters, offer, sell, offer to sell, contract to sell, pledge, grant any
option to purchase or otherwise sell or dispose (or announce any offer,
sale, offer of sale, contract of sale, pledge, grant of any option to
purchase or other sale or disposition) of any shares of Common Stock or any
securities convertible into, or exchangeable or exercisable for, shares of
Common Stock for a period of 180 days after the date hereof, except pursuant
to this Agreement and except for issuances pursuant to the exercise of
employee stock options outstanding on the date hereof and except for the
exercise of that certain warrant held by CNNfn, a division of Cable News
Network LP ("CNNfn"), but only if CNNfn agrees not to sell, offer, dispose of
or otherwise transfer the shares acquired on exercise of such warrant during
the remainder of the 180-day period covered by the agreements delivered
pursuant to Section 7(g).
(i) The Company will not, directly or indirectly, (i) take 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 or the Selling Securityholder to facilitate
the sale or resale of the Securities or (ii) (A) sell, bid for, purchase, or pay
anyone any compensation for soliciting purchases of, the Securities or (B) pay
or agree to pay to any person any compensation for soliciting another to
purchase any other securities of the Company or the Selling Securityholder.
(j) The Company will obtain the agreements described in Section 7(g)
hereof prior to the Firm Closing Date.
(k) If at any time during the 25-day period after the Registration
Statement becomes effective or the period prior to the Option Closing Date, any
rumor, publication or event relating to or affecting the Company shall occur as
a result of which in your opinion the market price of the Common Stock 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 you advising the Company to the
effect set forth above, forthwith prepare, consult with you concerning the
substance of, and disseminate a press release or other public statement,
reasonably satisfactory to you and the Company, responding to or commenting on
such rumor, publication or event.
(l) If the Company elects to rely on Rule 462(b), the Company shall both
file a 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 Act by the earlier of (i) 10:00 P.M. Eastern time on the date of this
Agreement and (ii) the time confirmations are sent or given, as specified by
Rule 462(b)(2).
(m) The Company will cause the Securities to be duly included for
quotation on the Nasdaq Stock Market's National Market (the "Nasdaq National
Market") prior to the Firm Closing Date. The Company will ensure that the
Securities remain included for quotation on the Nasdaq National Market following
the Firm Closing Date.
5A. COVENANTS OF THE SELLING SECURITYHOLDER. The Selling Securityholder
covenants and agrees with each of the several Underwriters that:
(a) The Selling Securityholder will not, directly or indirectly, (i)
take any action designed to cause or 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 or the Selling
Securityholder to facilitate the sale or resale of the Securities or (ii) (A)
sell, bid for, purchase, or pay anyone any compensation for soliciting
purchases of, the Securities or (B) pay or agree to pay to any person any
compensation for soliciting another to purchase any other securities of the
Company or the Selling Securityholder other than as provided by this
Agreement.
(b) The Selling Securityholder will not, directly or indirectly, without
the prior written consent of Prudential Securities Incorporated, offer, sell,
offer to sell, contract to sell, grant any option to purchase or otherwise sell
or dispose (or announce any offer, sale, offer of sale, contract of sale, grant
of any option to purchase or other sale or disposition) of any Securities
legally or beneficially owned by the Selling Securityholder or any securities
convertible into, or exchangeable or exercisable for, Securities for a period of
180 days after the date hereof, except pursuant to this Agreement.
(c) As soon as the Selling Securityholder is advised thereof, the Selling
Securityholder will advise the Representatives (and immediately thereafter
confirm such advise in writing), (i) of receipt by the Selling Securityholder or
by any representative or agent of the Selling Securityholder, of any
communication from the Commission relating to the Registration Statement, the
Prospectus or any Preliminary Prospectus, or any notice or order of the
Commission relating to the Company or the Selling Securityholder in connection
with the transactions contemplated by this Agreement and (ii) of the happening
of any event which makes or may make any statement of a material fact made in
the Registration Statement, the Prospectus or any Preliminary Prospectus untrue
or that requires the making of any change in the Registration Statement,
Prospectus or Preliminary Prospectus, as the case may be, in order to make such
statement, in light of the circumstances in which it was made, not misleading.
6. EXPENSES. The Company will pay all costs and expenses 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 11 hereof, including all costs and expenses
incident to (i) the printing or other production of documents with respect to
the transactions, including any costs of printing the registration statement
originally filed with respect to the Securities and any amendment thereto,
any Rule 462(b) Registration Statement, any Preliminary Prospectus and the
Prospectus and any amendment or supplement thereto, this Agreement and any
blue sky memoranda, (ii) all arrangements relating to the delivery to the
Underwriters of copies of the foregoing documents, (iii) the fees and
disbursements of the counsel, the accountants and any other experts or
advisors retained by the Company, (iv) preparation, issuance and delivery to
the Underwriters of any certificates evidencing the Securities, including
transfer agent's and registrar's fees, (v) the qualification of the
Securities under state securities and blue sky laws, including filing fees
and reasonable fees and disbursements of counsel for the Underwriters
relating thereto, (vi) the filing fees of the Commission and the National
Association of Securities Dealers, Inc. relating to the Securities, (vii) any
quotation of the Securities on the
Nasdaq National Market, (viii) any meetings with prospective investors in the
Securities (other than as shall have been specifically approved by the
Representatives to be paid for by the Underwriters) and (ix) advertising
relating to the offering of the Securities (other than any tombstone
advertisement in the national edition of the Wall Street Journal which shall
be paid for by the Underwriters). If the sale of the Securities provided for
herein is not consummated because any condition to the obligations of the
Underwriters set forth in Section 7 hereof is not satisfied, because this
Agreement is terminated pursuant to Section 11 hereof or because of any
failure, refusal or inability on the part of the Company or the Selling
Securityholder to perform all obligations and satisfy all conditions on their
part to be performed or satisfied hereunder other than by reason of a default
by any of the Underwriters, the Company will reimburse the Underwriters
severally upon demand for all out-of-pocket expenses (including counsel fees
and disbursements) that shall have been incurred by them in connection with
the proposed purchase and sale of the Securities. The Company shall not in
any event be liable to any of the Underwriters for the loss of anticipated
profits from the transactions covered by this Agreement. The provisions of
this Section 6 are intended to relieve the Underwriters from payment of the
costs and expenses which the Company hereby agrees to pay and shall in no way
affect any agreement between the Company and the Selling Securityholder for
the sharing of such costs and expenses.
7. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS. The obligations of the
several Underwriters to purchase and pay for the Firm Securities shall be
subject, in the Representatives' sole discretion, to the accuracy of the
representations and warranties of the Company and the Selling Securityholder
contained herein as of the date hereof and as of the Firm Closing Date, as if
made on and as of the Firm Closing Date, to the accuracy of the statements of
the Company's and the Selling Securityholder's officers made pursuant to the
provisions hereof, to the performance by the Company and the Selling
Securityholder of their respective covenants and agreements hereunder and to the
following additional conditions:
(a) If the Original Registration Statement or any amendment thereto filed
prior to the Firm Closing Date has not been declared effective as of the time of
execution hereof, the Original Registration Statement or such amendment and, 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 earlier of (i)
11:00 A.M., New York time, on the date on which the amendment to the
registration statement originally filed with respect to the Securities or to the
Registration Statement, as the case may be, containing information regarding the
initial public offering price of the Securities has been filed with the
Commission and (ii) the time confirmations are sent or given as specified by
Rule 462(b)(2), or with respect to the Original Registration Statement, 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
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 an opinion, dated the Firm
Closing Date, of Wildman, Harrold, Xxxxx & Xxxxx, counsel for the Company and
the Selling Securityholder, to the effect that:
(i) the Company has been duly organized and is validly existing as
a corporation in good standing under the laws of the State of Delaware and
is duly qualified to transact business as a foreign corporation and is in
good standing under the laws of all other jurisdictions where the ownership
or leasing of its properties 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;
(ii) the Company has corporate power to own or lease its properties
and conduct its business 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;
(iii) to the best knowledge of such counsel, the Company does not own
any shares of stock or any other equity securities of any corporation or
have any equity interest in any firm, company, partnership, association or
other entity;
(iv) the Company has an authorized, issued and outstanding
capitalization as set forth in the Prospectus; all of the outstanding
shares of capital stock of the Company, including the Selling
Securityholder Securities, 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, to the best knowledge of
such counsel, were not issued in violation of or subject to any preemptive
rights or other rights to subscribe for or purchase securities; the
Securities have been duly authorized by all necessary corporate action of
the Company and, the Company Firm Securities when issued and delivered to
and paid for by the Underwriters pursuant to this Agreement, will be
validly issued, fully paid and nonassessable; the Securities have been duly
included for trading on the Nasdaq National Market; to the best knowledge
of such counsel, (a) 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 Securities; and (b) no holders of securities of
the Company are entitled to have such securities registered under the
Registration Statement pursuant to any right which has not been waived;
(v) 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 "Risk Factors - Risks Related to Our Business -
We rely on a software licensing agreement that could be terminated or
allowed to expire," "Business Intellectual Property," "Certain
Transactions," "Description of Capital Stock" and "Shares Eligible for
Future Sale" in the Prospectus, insofar as such statements constitute a
summary of the legal matters, documents or proceedings referred to
therein, provide a fair summary of such legal matters, documents and
proceedings;
(vi) the execution and delivery of this Agreement have been duly
authorized by all necessary corporate action of the Company and the Selling
Securityholder and this Agreement has been duly executed and delivered by
the Company and the Selling Securityholder;
(vii) the execution, delivery and performance of the Intercompany
Agreements have been duly authorized by all necessary corporate action of
the Company and the Selling Securityholder and the Intercompany Agreements
have been duly executed and delivered by the Company and the Selling
Securityholder, and are the legal, valid, binding and enforceable
agreements of the Company and the Selling Securityholder, except as to
indemnification and contribution obligations under the Registration Rights
Agreement which may not be enforceable under applicable law, subject to
applicable bankruptcy, insolvency and similar laws effecting creditors'
rights generally, and subject, as to enforceability, to general principles
of equity (regardless of whether enforcement is sought in a proceeding in
equity or in law);
(viii) to the best knowledge of such counsel, (A) no legal or
governmental proceedings are pending to which the Company is a party or to
which the property of the Company is subject that are required to be
described in the Registration Statement or the Prospectus and are not
described therein and no such proceedings have been threatened against the
Company or with respect to any of its properties, and (B) no contract or
other document is required to be described in the Registration Statement or
the Prospectus or to be filed as an exhibit to the Registration Statement
that is not described therein or filed as required;
(ix) the issuance, offering and sale of the Securities to the
Underwriters by the Company pursuant to this Agreement, the sale of the
Securities to the Underwriters by the Selling Securityholder pursuant to
this Agreement, the compliance by the Company and the Selling
Securityholder with the other provisions of this Agreement, the
consummation of the other transactions herein contemplated and the
compliance by the Company and the Selling Securityholder with the terms of
the Intercompany Agreements do not (A) require the consent, approval,
authorization, registration or qualification of or with any governmental
authority, except such as have been obtained, or (B) 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, the Selling Securityholder or any subsidiary of the Selling
Securityholder is a party or by which the Company, the Selling
Securityholder or any subsidiary of the Selling Securityholder or any of
their respective properties are bound,
or the charter documents or by-laws of the Company, the Selling
Securityholder or any subsidiary of the Selling Securityholder, 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, the Selling Securityholder or any
subsidiary of the Selling Securityholder;
(x) the delivery by the Selling Securityholder to the several
Underwriters of certificates for the Securities being sold hereunder by the
Selling Securityholder against payment therefor as provided herein will
convey good and marketable title to such Securities to the several
Underwriters, free and clear of all security interests, liens,
encumbrances, equities, claims or other defects of title;
(xi) the Registration Statement is effective under the 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, to the
best knowledge of such counsel, 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 knowledge of such counsel, are contemplated by the Commission;
(xii) the Registration Statement originally filed with respect to the
Securities 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, data and schedules 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 Act
and the rules and regulations of the Commission thereunder;
(xiii) if the Company elects to rely on Rule 434, 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);
(xiv) the Company owns or possesses all material patents, patent
applications, trademarks, service marks, trade names, licenses, copyrights
and proprietary or other confidential information currently employed by the
Company in connection with its business as described in the Prospectus,
including, without limitation, all rights to the names PCQuote and
XXXxxxx.xxx, and, except as described in such opinion, to the best
knowledge of such counsel, the Company has not received any notice of
infringement of or conflict with asserted rights of any third party with
respect to any of the foregoing; and
(xv) the Company possesses all certificates, authorizations and
permits issued by the appropriate federal, state or foreign regulatory
authorities necessary to conduct its business as described in the
Prospectus, and, to the best knowledge of such counsel, the
Company has not received any notice of proceedings relating to the
revocation or modification of any such certificate, authorization or
permit.
Such counsel shall, based upon such counsel's participation in the
preparation of the Registration statement and the Prospectus, and any amendment
or supplement thereto, and upon such counsel's review and discussion of the
contents thereof, but without independent check or verification of the accuracy
or completeness thereof except as specified, nothing has come to the attention
of such counsel that has caused them to believe that the Registration Statement,
as of its effective date, (except for financial statements and other financial
information, data and schedules) contained any untrue statement of a material
fact or omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading or that the Prospectus,
as of its date or the date of such opinion, (except for financial statements and
other financial information, data and schedules) included or includes any untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
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. Such counsel may also state that
their opinions are limited in all respects to the laws of the State of Illinois,
the General Corporation Law of the State of Delaware and applicable United
States federal law, and that they have relied with respect to certain matters
relating to authorization by the Selling Securityholder covered by paragraph
(vii) upon the opinion of Morris, Nichols, Arsht & Xxxxxxx so long as such
opinion is addressed to the Underwriters and provided further that, in each
case, Wildman, Harrold, Xxxxx & Xxxxx shall state that they believe that they
and the Underwriters are justified in relying on such other counsel.
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.
(c) The Representatives shall have received an opinion, dated the Firm
Closing Date, of Fulbright & Xxxxxxxx L.L.P., New York, New York, counsel for
the Underwriters, with respect to the issuance and sale of the Firm Securities,
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 KPMG LLP, a letter or
letters dated, respectively, the date hereof and the Firm Closing Date, in form
and substance satisfactory to the Representatives, to the effect that:
(i) they are independent accountants with respect to the Company
within the meaning of the Act and the applicable rules and regulations
thereunder;
(ii) in their opinion, the audited financial statements and
schedules and pro
forma financial statements 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 Act and the
related published rules and regulations;
(iii) on the basis of a reading of the latest available interim
unaudited financial statements of the Company, 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
stockholders, the board of directors and any committees thereof of the
Company, and inquiries of certain officials of the Company who have
responsibility for financial and accounting matters, nothing came to their
attention that caused them to believe that:
(A) the unaudited financial statements of the Company included in
the Registration Statement and the Prospectus do not comply in
form in all material respects with the applicable accounting
requirements of the Act and the related published rules and
regulations thereunder or are not in conformity with generally
accepted accounting principles applied on a basis substantially
consistent with that of the audited financial statements
included in the Registration Statement and the Prospectus; and
(B) at a specific date not more than five days prior to the date of
such letter, there were any changes in the capital stock or
long-term debt of the Company or any decreases in net current
assets or stockholders' equity of the Company, in each case
compared with amounts shown on the March 31, 1999 unaudited
balance sheet included in the Registration Statement and the
Prospectus, or for the period from April 1, 1999 to such
specified date there were any decreases, in net revenues or
gross margin, or any increase in loss from operations or the
total or per share amounts of net loss of the Company as
compared, on a proportional basis, with the amounts shown in
the Company's income statement for the three months ended March
31, 1999, 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 are included in the Registration Statement and the
Prospectus under the captions "Prospectus Summary," "Risk Factors," "Use of
Proceeds," "Dividend Policy," "Capitalization," "Dilution," "Selected
Financial Data," "Management's Discussion and Analysis of Financial
Condition and Results of Operations," "Business," "Management," "Certain
Transactions," "Principal and Selling Stockholders," and "Description of
Capital Stock," and have compared such amounts,
percentages and financial information with such records of the Company
and with information derived from such records and have found them to be
in agreement, excluding any questions of legal interpretation; and
(v) on the basis of a reading of the unaudited pro forma financial
statements included in the Registration Statement and the Prospectus,
carrying out certain specified procedures that would not necessarily reveal
matters of significance with respect to the comments set forth in this
paragraph (v), inquiries of certain officials of the Company who have
responsibility for financial and accounting matters and proving the
arithmetic accuracy of the application of the pro forma adjustments to the
historical amounts in the unaudited pro forma financial statements, nothing
came to their attention that caused them to believe that the unaudited pro
forma financial statements do not comply in form in all material respects
with the applicable accounting requirements of Rule 11-02 of Regulation S-X
or that the pro forma adjustments have not been properly applied to the
historical amounts in the compilation of such statements.
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 (A) 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 (B) 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
Securities 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 Representatives shall have received a certificate, dated the Firm
Closing Date, of the Company, signed by its Chief Executive Officer and the
Chief Financial Officer of the Company 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 Firm Closing
Date; the Registration Statement, as amended as of the Firm 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 Firm 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 Firm
Closing Date;
(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, the Company has not
sustained any material loss or interference with its business or properties
from fire, flood, hurricane, accident or other calamity, whether or not
covered by insurance, or from any labor dispute or any legal or
governmental proceeding, and there has not been any material adverse
change, or any development involving a prospective material adverse change,
in the condition (financial or otherwise), management, business prospects,
net worth or results of operations of the Company, 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 a certificate from the Selling
Securityholder, signed by the Selling Securityholder, dated the Closing Date, to
the effect that:
(i) the representations and warranties of the Selling
Securityholder in this Agreement are true and correct as if made on and as
of the Closing Date;
(ii) 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
(iii) the Selling Securityholder has performed all covenants and
agreements on its part to be performed or satisfied at or prior to the
Closing Date.
(g) The Representatives shall have received from each person who is a
director or officer of the Company, who owns shares of Common Stock (other than
the Selling Securityholder) or who has an option or warrant to acquire shares of
Common Stock an agreement to the effect that such person will not, directly or
indirectly, without the prior written consent of Prudential Securities
Incorporated, on behalf of the Underwriters, offer, sell, offer to sell,
contract to sell, pledge, grant any option to purchase or otherwise sell or
dispose (or announce any offer, sale, offer of sale, contract of sale, pledge,
grant of an option to purchase or other sale or disposition) of any shares of
Common Stock or any securities convertible into, or exchangeable or exercisable
for, shares of Common Stock for a period of 180 days after the date of this
Agreement.
(h) On or before the Firm 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 and the
Selling Securityholder.
(i) Prior to the commencement of the offering of the Securities, the
Securities shall
have been included for trading on the Nasdaq National Market.
(j) The Company shall have received all consents and approvals required
for the consummation of the transactions contemplated by the Intercompany
Agreements except where the failure to obtain such consents or authorizations,
considered in the aggregate, would not have material adverse effect with regard
to property, business or operations of the Company; PROVIDED, HOWEVER, the
Company shall have obtained all approvals required pursuant to Section 10 of the
DataFeed License Agreement irrespective of whether the failure to do so would
have a material adverse effect on the Company.
(k) 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 contained in the Company's
agreements with CNNFN, a division of Cable News Network LP, LLP, dated April 12,
1999, and Xxxxxxxx Analytics, Ltd., dated May 28, 1999, and each such agreement
shall be in full force and effect.
All opinions, certificates, letters and documents delivered pursuant to
this Agreement will comply with the provisions hereof only if they are
reasonably 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 Option Securities shall be subject, in their discretion, to each of the
foregoing conditions to purchase the Firm Securities, except that all references
to the Firm Securities and the Firm Closing Date shall be deemed to refer to
such Option Securities and the related Option Closing Date, respectively.
8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company and, subject to
Section 8(e) of the Agreement, the Selling Securityholder jointly and severally
agree to indemnify and hold harmless each Underwriter and each person, if any,
who controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Securities Exchange Act of 1934 (the "Exchange Act"), against
any losses, claims, damages or liabilities, joint or several, to which such
Underwriter or such controlling person may become subject under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue statement made by the
Company or the Selling Securityholder in Section 2 or 2A of this Agreement,
(ii) any untrue statement or alleged untrue statement of any
material fact contained in (A) the Registration Statement or any amendment
thereto, any Preliminary Prospectus or the Prospectus or any amendment or
supplement thereto or (B) any
application or other document, or any amendment or supplement thereto,
executed by the Company or the Selling Securityholder or based upon
written information furnished by or on behalf of the Company or the
Selling Securityholder filed in any jurisdiction in order to qualify the
Securities under the securities or blue sky laws thereof or filed with
the Commission or any securities association or securities exchange
(each an "Application"),
(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, or any Application a
material fact required to be stated therein or necessary to make the
statements therein not misleading, or
(iv) any untrue statement or alleged untrue statement of any
material fact contained in any audio or visual materials provided by the
Company or based upon written information furnished by or on behalf of the
Company including, without limitation, slides, videos, films, tape
recordings, used in connection with the marketing of the Securities,
including, without limitation, statements communicated to securities
analysts employed by the Underwriters
and will reimburse, as incurred, each Underwriter and each such controlling
person for any legal or other 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 and the Selling Securityholder 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 such registration statement or any
amendment thereto, any Preliminary Prospectus, the Prospectus or any
amendment or supplement thereto or any Application in reliance upon and in
conformity with written information furnished to the Company by such
Underwriter through the Representatives specifically for use therein; and
provided, further, that the Company and the Selling Securityholder will not
be liable to any Underwriter or any person controlling such Underwriter with
respect to any such untrue statement or omission made in any Preliminary
Prospectus that is corrected in the Prospectus (or any amendment or
supplement thereto) if the person asserting any such loss, claim, damage or
liability purchased Securities from such Underwriter but was not sent or
given a copy of the Prospectus (as amended or supplemented) at or prior to
the written confirmation of the sale of such Securities to such person in any
case where such delivery of the Prospectus (as amended or supplemented) is
required by the Act, unless such failure to deliver the Prospectus (as
amended or supplemented) was a result of noncompliance by the Company with
Section 5(d) or (e) of this Agreement. This indemnity agreement will be in
addition to any liability which the Company and the Selling Securityholder
may otherwise have. Neither the Company nor the Selling Securityholder will,
without the prior written consent of the Underwriter or Underwriters
purchasing, in the aggregate, more than fifty percent (50%) of the
Securities, 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
Underwriter or any person who controls any such Underwriter within the
meaning of Section 15 of the Act or Section 20 of the
Exchange Act 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, the Selling Securityholder and each person, if any, who
controls the Company or the Selling Securityholder within the meaning of Section
15 of the Act or Section 20 of the Exchange Act against any losses, claims,
damages or liabilities to which the Company, the Selling Securityholder or any
such director, officer or controlling person may become subject under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon (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 any Application or (ii) the omission
or the alleged omission to state therein a material fact required to be stated
in the Registration Statement or any amendment thereto, any Preliminary
Prospectus or the Prospectus or any amendment or supplement thereto, or any
Application 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, the Selling Securityholder, or any such director, officer or
controlling person of the Company or the Selling Securityholder in connection
with investigating or defending any such loss, claim, damage, liability or any
action in respect thereof. This indemnity agreement will be in addition to any
liability which such Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section 8 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party of the commencement thereof; 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 8. 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 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 thereof 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 8 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 by the Representatives in the case of paragraph
(a) of this Section 8, 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 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. 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 8 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 of the Securities 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 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 and the Selling Securityholder 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 and the Selling Securityholder 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, the Selling Securityholder 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, the Selling Securityholder 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 Securities 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 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 its underwriting obligations and not joint, and contributions among
Underwriters shall be governed by the provisions of the Prudential Securities
Incorporated 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 Act or Section 20 of the Exchange Act shall have
the same rights to contribution as such Underwriter, and each director of the
Company or the Selling Securityholder, each officer of the Company who signed
the Registration Statement and each person, if any, who controls the Company
or the Selling Securityholder within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, shall have the same rights to contribution as
the Company or the Selling Securityholder, as the case may be.
(e) The liability of the Selling Securityholder under this Agreement
(including this Section 8) shall not exceed the proceeds to the Selling
Securityholder from the sale of the Securities sold by the Selling
Securityholder to the Underwriters.
9. DEFAULT OF UNDERWRITERS. If one or more Underwriters default in their
obligations to purchase Firm Securities or Option Securities hereunder and the
aggregate number of such Securities that such defaulting Underwriter or
Underwriters agreed but failed to purchase is ten percent or less of the
aggregate number of Firm Securities or Option Securities to be purchased by all
of the Underwriters at such time hereunder, the other Underwriters may make
arrangements satisfactory to the Representatives for the purchase of such
Securities 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 Firm Closing Date or the related Option Closing Date, as the case
may be, the other Underwriters shall be obligated severally in proportion to its
commitments hereunder to purchase the Firm Securities or Option Securities that
such defaulting Underwriter or Underwriters agreed but failed to purchase. If
one or more Underwriters so default with respect to an aggregate number of
Securities that is more than ten percent of the aggregate number of Firm
Securities or Option Securities, as the case may be, to be purchased by all of
the Underwriters at such time hereunder, and if arrangements satisfactory to the
Representatives are not made within 36 hours after such default for the purchase
by other persons (who may include one or more of the non-defaulting
Underwriters, including the Representatives) of the Securities with respect to
which such default occurs, this Agreement will terminate without liability on
the part of any non-defaulting Underwriter or the Company other than as provided
in Section 10 hereof. In the event of any default by one or more Underwriters as
described in this Section 9, the Representatives shall have the right to
postpone the Firm Closing Date or the Option Closing Date, as the case may be,
established as provided in Section 3 hereof for not more than seven business
days in order that any necessary changes may be made in the arrangements or
documents for the
purchase and delivery of the Firm Securities or Option Securities, as the
case may be. As used in this Agreement, the term "Underwriter" includes any
person substituted for an Underwriter under this Section 9. Nothing herein
shall relieve any defaulting Underwriter from liability for its default.
10. SURVIVAL. The respective representations, warranties, agreements,
covenants, indemnities and other statements of the Company, its officers, the
Selling Securityholder 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, the Selling Securityholder, any Underwriter or any controlling
person referred to in Section 8 hereof and (ii) delivery of and payment for
the Securities. The respective agreements, covenants, indemnities and other
statements set forth in Sections 6 and 8 hereof shall remain in full force
and effect, regardless of any termination or cancellation of this Agreement.
11. TERMINATION. (a) This Agreement may be terminated with respect to
the Firm Securities or any Option Securities in the sole discretion of the
Representatives by notice to the Company and the Selling Securityholder given
prior to the Firm Closing Date or the related Option Closing Date,
respectively, in the event that the Company or the Selling Securityholder
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 the Firm Closing Date or such Option
Closing Date, respectively,
(i) the Company shall have, in the sole judgment of the
Representatives, sustained any material loss or interference with its
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 material
adverse change, or any development involving a prospective material adverse
change (including without limitation a change in management or control of
the Company), in the condition (financial or otherwise), business
prospects, net worth or results of operations of the Company, except in
each case as described in or contemplated by the Prospectus (exclusive of
any amendment or supplement thereto);
(ii) trading in the Common Stock or in the Common Stock of the
Selling Securityholder shall have been suspended by the Commission, the
American Stock Exchange or the Nasdaq National Market or trading in
securities generally on the New York Stock Exchange, the American Stock
Exchange or Nasdaq National Market shall have been suspended or minimum or
maximum prices shall have been established on either such exchange or
market system;
(iii) a banking moratorium shall have been declared by New York or
United States authorities; or
(iv) there shall have been (A) an outbreak or escalation of
hostilities between the
United States and any foreign power, (B) an outbreak or escalation of
any other insurrection or armed conflict involving the United States or
(C) any other calamity or crisis or material 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 Securities as contemplated by the Registration
Statement, as amended as of the date hereof.
(b) Termination of this Agreement pursuant to this Section 11 shall be
without liability of any party to any other party except as provided in Section
10 hereof.
12. 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
Sections 2(b) and 8 hereof. The Underwriters confirm that such statements (to
such extent) are correct.
13. NOTICES. All communications hereunder shall be in writing and, if sent
to any of the Underwriters, shall be delivered or sent by mail, telex or
facsimile transmission and confirmed in writing to Prudential Securities
Incorporated, Xxx Xxx Xxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Equity
Transactions Group; and if sent to the Company or The Selling Securityholder,
shall be delivered or sent by mail, telex or facsimile transmission and
confirmed in writing to the Company at 000 Xxxxx Xxxxxx Xxxxx, Xxxxx 000,
Xxxxxxx, Xxxxxxxx 00000, Attention: Chief Executive Officer.
14. SUCCESSORS. This Agreement shall inure to the benefit of and shall be
binding upon the several Underwriters, the Company, the Selling Securityholder
and its 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 and the Selling Securityholder contained in
Section 8 of this Agreement shall also be for the benefit of any person or
persons who control any Underwriter within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act and (ii) the indemnities of the Underwriters
contained in Section 8 of this Agreement shall also be for the benefit of the
directors of the Company and the Selling Securityholder, the officers of the
Company who have signed the Registration Statement and any person or persons who
control the Company or the Selling Securityholder within the meaning of Section
15 of the Act or Section 20 of the Exchange Act and the Selling Securityholder.
No purchaser of Securities from any Underwriter shall be deemed a successor
because of such purchase.
15. APPLICABLE 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.
16. CONSENT TO JURISDICTION AND SERVICE OF PROCESS. All judicial
proceedings arising out of or relating to this Agreement may be brought in any
state or federal court of competent jurisdiction in the State of New York, and
by execution and delivery of this Agreement, each of the Company and the Selling
Securityholder accepts for itself and in connection with its properties,
generally and unconditionally, the nonexclusive jurisdiction of the aforesaid
courts and waives any defense of forum non conveniens and irrevocably agrees to
be bound by any judgment rendered thereby in connection with this Agreement.
Each of the Company and the Selling Securityholder designates and appoints
__________________, and such other persons as may hereafter be selected by the
Company or the Selling Securityholder irrevocably agreeing in writing to so
serve, as their agent to receive on their behalf service of all process in any
such proceedings in any such court, such service being hereby acknowledged by
the Company and the Selling Securityholder to be effective and binding service
in every respect. A copy of any such process so served shall be mailed by
registered mail to the Company and the Selling Securityholder at the address
provided in Section 13 hereof; PROVIDED, HOWEVER, that, unless otherwise
provided by applicable law, any failure to mail such copy shall not affect the
validity of service of such process. If any agent appointed by the Company or
The Selling Securityholder refuses to accept service, the Company and the
Selling Securityholder each hereby agree that service of process sufficient for
personal jurisdiction in any action against the Company or the Selling
Securityholder in the State of New York may be made by registered or certified
mail, return receipt requested, to the Company or the Selling Securityholder, as
the case may be, at the address provided in Section 13 hereof, and the Company
and the Selling Securityholder each hereby acknowledge that such service shall
be effective and binding in every respect. Nothing herein shall affect the right
to serve process in any other manner permitted by law or shall limit the right
of any Underwriter to bring proceedings against the Company and the Selling
Securityholder in the courts of any other jurisdiction.
17. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
If the foregoing correctly sets forth our understanding, please indicate
your acceptance thereof in the space provided below for that purpose, whereupon
this letter shall constitute an agreement binding the Company and each of the
several Underwriters.
Very truly yours,
XXXXXXX.XXX, INC.
By
---------------------------------
Xxx X. Xxxxxx
Chief Executive Officer
HYPERFEED TECHNOLOGIES INC.
By
---------------------------------
Xxxx Xxxxx
Chief Financial Officer
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
PRUDENTIAL SECURITIES INCORPORATED
U.S. BANCORP XXXXX XXXXXXX INC.
FIRST ALBANY CORPORATION
E*OFFERING CORP.
By PRUDENTIAL SECURITIES INCORPORATED
By
-----------------------------
Xxxx-Xxxxxx Canfin
Managing Director
For itself and on behalf of the Representatives.
SCHEDULE 1
UNDERWRITERS
Number of Firm
Securities to
Underwriter be Purchased
----------- --------------
Prudential Securities Incorporated..........
U.S. Bancorp Xxxxx Xxxxxxx Inc..............
First Albany Corporation....................
E*Offering Corp.............................
--------------
Total ..................... 7,750,000
