5,750,000 SHARES
▇▇▇▇▇ GOLF, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
July ___, 1998
▇▇▇▇▇▇ BROTHERS INC.
NATIONSBANC ▇▇▇▇▇▇▇▇▇▇ SECURITIES LLC
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ INCORPORATED
As Representatives of the several
Underwriters named in Schedule 1,
c/▇ ▇▇▇▇▇▇ Brothers Inc.
Three World ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
▇▇▇▇▇ GOLF, INC., a Delaware corporation (the "Company"), and certain
stockholders of the Company named in Schedule 2 hereto (the "Selling
Stockholders"), propose to sell an aggregate of 5,750,000 shares (the "Firm
Stock") of the Company's Common Stock, par value $0.001 per share (the "Common
Stock"). Of the 5,750,000 shares of the Firm Stock, 3,750,000 shares are being
sold by the Company and 2,000,000 shares are being sold by the Selling
Stockholders. In addition, the Selling Stockholders propose to grant to the
Underwriters named in Schedule 1 hereto (the "Underwriters") an option to
purchase up to an additional 862,500 shares of the Common Stock on the terms and
for the purposes set forth in Section 3 (the "Option Stock"). The Firm Stock
and the Option Stock, if purchased, are hereinafter collectively called the
"Stock." This is to confirm the agreement concerning the purchase of the Stock
from the Company and the Selling Stockholders by the Underwriters.
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY AND
CERTAIN SELLING STOCKHOLDERS. Each of the Company and ▇.▇. ▇▇▇▇▇ and ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇ (the "Management Stockholders") severally represents, warrants
and agrees that:
(a) A registration statement on Form S-1 (File No. 333-51715 with
respect to the Stock has (i) been prepared by the Company in conformity
with the requirements of the Securities Act of 1933, as amended (the
"Securities Act"), and the rules and regulations (the "Rules and
Regulations") of the United States Securities and Exchange Commission (the
"Commission") thereunder, (ii) been filed with the Commission under the
Securities Act and (iii) become effective under the Securities Act. Copies
of such registration statement have been delivered by the Company to you as
the representatives (the "Representatives") of the Underwriters. As used
in this Agreement, "Effective Time" means the date and the time as of which
such registration statement, or the most recent post-effective amendment
thereto, if any, was declared effective by the
Commission; "Effective Date" means the date of the Effective Time;
"Preliminary Prospectus" means each prospectus included in such
registration statement, or amendments thereof, before it became effective
under the Securities Act and any prospectus filed with the Commission by
the Company pursuant to Rule 424(a) of the Rules and Regulations;
"Registration Statement" means such registration statement, as amended at
the Effective Time, including all information contained in the final
prospectus filed with the Commission pursuant to Rule 424(b) of the Rules
and Regulations in accordance with Section 6(a) hereof and deemed to be a
part of the registration statement as of the Effective Time pursuant to
paragraph (b) of Rule 430A of the Rules and Regulations and, in the event
of any amendment thereto or the filing of any abbreviated registration
statement pursuant to Rule 462(b) of the Rules and Regulations relating
thereto after the Effective Date, shall also mean (from and after the
effectiveness of such amendment or the filing of such abbreviated
registration statement) such registration statement as so amended, together
with any such abbreviated registration statement; and "Prospectus" means
such final prospectus, as first filed with the Commission pursuant to
paragraph (1) or (4) of Rule 424(b) of the Rules and Regulations. The
Commission has not issued any order preventing or suspending the use of any
Preliminary Prospectus or instituted proceedings for that purpose.
(b) (i) The Registration Statement conforms, and the Prospectus and
any further amendments or supplements to the Registration Statement or the
Prospectus will, when they become effective or are filed with the
Commission, as the case may be and at all times subsequent thereto up to
and including the First Delivery Date (as defined in Section 5) and the
Second Delivery Date (as defined in Section 5), conform in all material
respects to the requirements of the Securities Act and the Rules and
Regulations; (ii) the Registration Statement, and any amendments and
supplements thereto, did not and will not, as the applicable effective
date, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and (iii) the Prospectus, and any
amendments or supplements thereto, did not and will not, as of the date
thereof, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances under which
they were made; PROVIDED THAT no representation or warranty is made as to
information contained in or omitted from the Registration Statement or the
Prospectus in reliance upon and in conformity with written information
furnished to the Company through the Representatives by or on behalf of any
Underwriter specifically for inclusion therein.
(c) The Company and each of its subsidiaries (as defined in Section
17) which is a corporation have been duly incorporated and are validly
existing as corporations in good standing under the laws of their
respective jurisdictions of incorporation, are duly qualified to do
business and are in good standing as foreign corporations in each
jurisdiction in which their respective ownership or lease of property or
the conduct of their respective businesses requires such qualification,
except where the failure to so qualify would not have a material adverse
effect on the consolidated financial position, stockholders' equity,
results of operations, business or prospects of the Company and its
subsidiaries, taken as a whole ("Material Adverse Effect"), and have all
power and
2.
authority necessary to own or hold their respective properties and to
conduct the businesses in which they are engaged; each of the Company's
subsidiaries which is a limited partnership is duly formed, validly
existing and in good standing under the laws of its respective jurisdiction
and each such subsidiary has all requisite partnership power and authority
under its certificate of limited partnership and agreement of limited
partnership to hold its properties and to conduct the businesses in which
it is engaged; and none of the subsidiaries of the Company is a
"significant subsidiary", as such term is defined in Rule 405 of the Rules
and Regulations, other than ▇▇▇▇▇ Golf Holding Corp., ▇▇▇▇▇ Golf GP Corp.,
▇▇▇▇▇ Golf Management Corp., ▇▇▇▇▇ Golf Direct Response, Ltd., ▇▇▇▇▇ Golf,
Ltd. and ▇▇▇▇▇ Golf IP, L.P. The Company does not have any subsidiaries
other than those set forth on Exhibit 21.1 to the Registration Statement.
(d) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued and outstanding shares of capital stock
of the Company have been duly and validly authorized and issued, are fully
paid and non-assessable and conform in all material respects to the
description thereof contained in the Prospectus; and all of the issued
shares of capital stock of each subsidiary of the Company have been duly
and validly authorized and issued and are fully paid and non-assessable and
are owned directly or indirectly by the Company, free and clear of all
liens, encumbrances, equities or claims.
(e) The unissued shares of the Stock to be issued and sold by the
Company to the Underwriters hereunder have been duly and validly authorized
and, when issued and delivered against payment therefor as provided herein,
will be duly and validly issued, fully paid and non-assessable; and the
Stock will conform in all material respects to the descriptions thereof
contained in the Prospectus.
(f) This Agreement has been duly authorized, executed and delivered
by the Company.
(g) The execution, delivery and performance of this Agreement by the
Company and the consummation of the transactions contemplated hereby will
not conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the Company or
any of its subsidiaries is bound or to which any of the property or assets
of the Company or any of its subsidiaries is subject, except where such
conflict, breach, violation or default would not have a Material Adverse
Effect, nor will such actions result in any violation of the provisions of
the charter, bylaws, certificate of limited partnership or agreement of
limited partnership, as applicable, of the Company or any of its
subsidiaries or any statute, rule or regulation or any order known to the
Company of any court or governmental agency or body having jurisdiction
over the Company or any of its subsidiaries or any of their properties or
assets, except where such violation would not have a Material Adverse
Effect; and except for the registration of the Stock under the Securities
Act and such consents, approvals, authorizations, registrations or
qualifications as may be required under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and applicable state securities laws
in connection with
3.
the purchase and distribution of the Stock by the Underwriters, no consent,
approval, authorization or order of, or filing or registration with, any
such court or governmental agency or body is required for the execution,
delivery and performance of this Agreement by the Company and the
consummation of the transactions contemplated hereby.
(h) Except as described or referred to in the Prospectus, there are
no contracts, agreements or understandings between the Company and any
person granting such person the right (other than rights which have been
waived or satisfied) to require the Company to file a registration
statement under the Securities Act with respect to any securities of the
Company owned or to be owned by such person or to require the Company to
include such securities in the securities registered pursuant to the
Registration Statement or in any securities being registered pursuant to
any other registration statement filed by the Company under the Securities
Act.
(i) Except as described or referred to in the Registration Statement,
the Company has not sold or issued any shares of Common Stock during the
six-month period preceding the date of the Prospectus, including any sales
pursuant to Rule 144A or Regulations D or S under the Securities Act, other
than shares issued pursuant to employee benefit plans, qualified stock
options plans or other employee compensation plans or pursuant to
outstanding options, rights or warrants.
(j) Neither the Company nor any of its subsidiaries has sustained,
since the date of the latest financial statements included in the
Prospectus, any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or
from any labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Prospectus, in each case
except for such loss or interference as would not have a Material Adverse
Effect; and, since such date, there has not been any change in the capital
stock or long-term debt of the Company or any of its subsidiaries or any
material adverse change, or any development known to the Company involving
a prospective material adverse change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as set forth
or contemplated in the Prospectus.
(k) The financial statements (including the related notes and
supporting schedules) filed as part of the Registration Statement or
included in the Prospectus present fairly the consolidated financial
condition and results of operations of the entities purported to be shown
thereby, at the dates and for the periods indicated, and have been prepared
in conformity with generally accepted accounting principles applied on a
consistent basis throughout the periods involved, except as otherwise
stated therein.
(l) KPMG Peat Marwick LLP ("KPMG"), who have certified certain
financial statements of the Company, whose report appears in the Prospectus
and who have delivered the initial letter referred to in Section 9(g)
hereof, have advised the Company that they are independent public
accountants as required by the Securities Act and the Rules and
Regulations.
4.
(m) Neither the Company nor any of its subsidiaries owns any real
property; the Company and each of its subsidiaries have good and defensible
title to all personal property owned by them, in each case free and clear
of all liens, encumbrances and defects except (i) such as are described or
referred to in the Prospectus or (ii) such as do not materially affect the
value of such property and do not materially interfere with the use made
and proposed to be made of such property by the Company and its
subsidiaries; and all real property and buildings held under lease by the
Company and its subsidiaries are held by them under valid and subsisting
leases enforceable against the Company, with such exceptions as are not
material and do not interfere in any material respect with the use made and
proposed to be made of such property and buildings by the Company and its
subsidiaries.
(n) The Company and each of its subsidiaries carry, or are covered
by, insurance in such amounts and covering such risks as in the reasonable
good faith judgment of the Company, is adequate for the conduct of their
respective businesses and the value of their respective properties.
(o) Except as described in the Prospectus, the Company and each of
its subsidiaries own or possess adequate rights to use all material
patents, patent applications, trademarks, service marks, trade names,
trademark registrations, service ▇▇▇▇ registrations, copyrights and
licenses necessary for the conduct of their respective businesses and have
no reason to believe that the conduct of their respective businesses will
conflict with, and have not received any notice of any claim of conflict
with, any such rights of others.
(p) There are no legal or governmental proceedings pending to which
the Company or any of its subsidiaries is a party or of which any property
or assets of the Company or any of its subsidiaries is the subject which,
if determined adversely to the Company or any of its subsidiaries, would
reasonably be expected to have a Material Adverse Effect and, to the actual
knowledge of the Company, no such proceedings are threatened by
governmental authorities or others.
(q) There are no contracts or other documents that are required to be
described in the Prospectus or filed as exhibits to the Registration
Statement by the Securities Act or by the Rules and Regulations that have
not been described in the Prospectus or filed as exhibits to the
Registration Statement or incorporated therein by reference as permitted by
the Rules and Regulations.
(r) No relationship, direct or indirect, exists between or among the
Company on the one hand, and the directors, officers, stockholders,
customers or suppliers of the Company on the other hand, that is required
to be described in the Prospectus that is not so described.
(s) No labor disturbance by the employees of the Company exists or,
to the actual knowledge of the Company, is imminent that would reasonably
be expected to have a Material Adverse Effect.
5.
(t) The Company and its subsidiaries have filed all federal, state
and local income and franchise tax returns required to be filed through the
date hereof and have paid all taxes due thereon, and no tax deficiency has
been determined adversely to the Company or any of its subsidiaries which
has had (nor does the Company have any actual knowledge of any tax
deficiency which, if determined adversely to the Company or any of its
subsidiaries, would reasonably be expected to have) a Material Adverse
Effect. The Company and its subsidiaries have paid all sales and use taxes
owed through the date hereof in each jurisdiction in which any such taxes
are owed, except where the failure to pay would not have a Material Adverse
Effect. All tax liabilities are adequately provided for on the books of
the Company and its subsidiaries.
(u) Since the date as of which information is given in the Prospectus
through the date hereof, and except as may otherwise be disclosed in the
Prospectus, the Company has not (i) issued or granted any securities,
(ii) incurred any material liability or obligation, direct or contingent,
other than those incurred in the ordinary course of business, (iii) entered
into any material transaction not in the ordinary course of business or
(iv) declared or paid any dividend on its capital stock.
(v) The Company (i) makes and keeps accurate books and records and
(ii) maintains internal accounting controls that provide reasonable
assurance that (A) transactions are executed in accordance with
management's authorization, (B) transactions are recorded as necessary to
permit preparation of its financial statements and to maintain
accountability for its assets, (C) access to its assets is permitted only
in accordance with management's authorization and (D) the reported
accountability for its assets is compared with existing assets at
reasonable intervals.
(w) Neither the Company nor any of its subsidiaries (i) is in
violation of its charter, bylaws, certificate of limited partnership or
agreement of limited partnership, as applicable, (ii) is in default, and no
event has occurred which, with notice or lapse of time or both, would
constitute a default, in the due performance or observance of any term,
covenant or condition contained in any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which it is a party or
by which it is bound or to which any of its properties or assets is
subject, in each case except for any default that would not reasonably be
expected to have a Material Adverse Effect, or (iii) is in violation of any
law, ordinance, governmental rule, regulation or court decree known to the
Company to which it or its property or assets may be subject or has failed
to obtain any license, permit, certificate, franchise or other governmental
authorization or permit necessary to the ownership of its property or to
the conduct of its business, in each case except where such violation or
failure to obtain, as the case may be, would not reasonably be expected to
have a Material Adverse Effect.
(x) Neither the Company nor any of its subsidiaries, nor, to the
Company's actual knowledge, any director, officer, agent, employee or other
person associated with or acting on behalf of the Company or any of its
subsidiaries, has used any corporate funds for any unlawful contribution,
gift, entertainment or other unlawful expense relating to political
activity; made any direct or indirect unlawful payment to any foreign or
domestic government official or employee from corporate funds; violated or
is in
6.
violation of any provision of the Foreign Corrupt Practices Act of 1977; or
made any bribe, illegal rebate, payoff, influence payment, kickback or
other unlawful payment.
(y) Except as set forth in the Registration Statement and Prospectus,
(i) each of the Company and its subsidiaries is in material compliance with
all rules, laws and regulations relating to the use, treatment, storage and
disposal of toxic substances and protection of health or the environment
("Environmental Laws") which are applicable to its business, (ii) neither
the Company nor any of its subsidiaries has received any notice from any
governmental authority or third party of an asserted claim under
Environmental Laws, which claim is required to be disclosed in the
Registration Statement and the Prospectus, (iii) to its actual knowledge,
neither the Company nor any of its subsidiaries will be required to make
future material capital expenditures to comply with Environmental Laws and
(iv) no property that is owned, leased or occupied by the Company or any of
its subsidiaries has been designated as a Superfund site pursuant to the
Comprehensive Response, Compensation and Liability Act of 1980, as amended
(42 U.S.C. Section 9601, ET SEQ.), or otherwise designated as a
contaminated site under applicable state or local law.
(z) The Company has not distributed and will not distribute prior to
the later of (i) the First Delivery Date, or the Second Delivery Date, as
the case may be, and (ii) completion of the distribution of the Firm Stock,
any offering material in connection with the offering and sale of the Stock
other than any Preliminary Prospectus, the Prospectus, the Registration
Statement and other materials, if any, permitted by the Securities Act.
(aa) The Company has not taken and will not take, directly or
indirectly, any action designed to or that would reasonably be expected to
cause or result in stabilization or manipulation of the price of the Common
Stock to facilitate the sale or resale of the Stock.
(bb) The Common Stock has been approved for quotation on the Nasdaq
National Market, subject to official notice of issuance.
(cc) The Company is not, and upon completion of the transactions
contemplated hereby will not be, subject to registration as an Investment
Company Act of 1940, as amended (the "1940 Act"), and the rules and
regulations thereunder.
(dd) Other than the Representatives, since its inception, the Company
has not granted any individual or entity any rights to underwrite any
public or private offering of any of the Company's securities.
2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE SELLING
STOCKHOLDERS. Each Selling Stockholder severally represents, warrants and
agrees, solely with respect to such Selling Stockholder that:
(a) The Selling Stockholder has, and immediately prior to the First
Delivery Date (as defined in Section 5 hereof) the Selling Stockholder will
have, good and valid title to the shares of Stock to be sold by the Selling
Stockholder hereunder on such date,
7.
free and clear of all liens, encumbrances, equities or claims; and upon
delivery of such shares and payment therefor pursuant hereto, good and
valid title to such shares, free and clear of all liens, encumbrances,
equities or claims, will pass to the several Underwriters.
(b) The Selling Stockholder has placed in custody under a custody
agreement (the "Custody Agreement" and, together with all other similar
agreements executed by the other Selling Stockholders, the "Custody
Agreements") with The Bank of New York, as custodian (the "Custodian"), for
delivery under this Agreement, certificates in negotiable form endorsed in
blank or accompanied by blank stock powers duly executed (with signature
guaranteed by an "eligible guarantor institution" as defined in
Rule 17Ad-15 under the Exchange Act), representing the shares of Stock to
be sold by the Selling Stockholder hereunder.
(c) The Selling Stockholder has duly and irrevocably executed and
delivered a power of attorney (the "Power of Attorney" and, together with
all other similar agreements executed by the other Selling Stockholders,
the "Powers of Attorney") appointing ▇.▇. ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ as
attorneys-in-fact (the "Attorneys-in-Fact"), with full power of
substitution, and with full authority (exercisable by either or both of
them) to execute and deliver this Agreement and to take such other action
as may be necessary or desirable to carry out the provisions hereof on
behalf of the Selling Stockholder.
(d) If the Selling Stockholder is a corporate entity, such Selling
Stockholder has the corporate power and authority to enter into this
Agreement, the Power of Attorney and the Custody Agreement; the execution,
delivery and performance of this Agreement, the Power of Attorney and the
Custody Agreement by the Selling Stockholder and the consummation by the
Selling Stockholder of the transactions contemplated hereby and thereby
will not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any material
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Selling Stockholder is a party or by which the
Selling Stockholder is bound or to which any of the property or assets of
the Selling Stockholder is subject, nor will such actions result in any
violation of the provisions of the charter or bylaws of the Selling
Stockholder, if applicable, the articles or certificate of partnership of
the Selling Stockholder, the deed of trust of the Selling Stockholder or
any statute, rule or regulation or any known order of any court or
governmental agency or body having jurisdiction over the Selling
Stockholder or the property or assets of the Selling Stockholder; and,
except for the registration of the Stock under the Securities Act and such
consents, approvals, authorizations, registrations or qualifications as may
be required under the Exchange Act and applicable state securities laws in
connection with the purchase and distribution of the Stock by the
Underwriters, no consent, approval, authorization or order of, or filing or
registration with, any such court or governmental agency or body is
required for the execution, delivery and performance of this Agreement, the
Power of Attorney or the Custody Agreement by the Selling Stockholder and
the consummation by the Selling Stockholder of the transactions
contemplated hereby and thereby.
8.
(e) The Registration Statement, and any amendments or supplements
thereto, did not and will not, as of the applicable effective date, contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading, and the Prospectus, and any amendments or supplements
thereto, did not and will not, as of the date thereof, contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading in light of the circumstances under which they were made;
PROVIDED THAT, with respect to those Selling Stockholders that are not
Management Stockholders, the foregoing shall apply in each case only
insofar as such statements relate to the Selling Stockholder; PROVIDED
FURTHER that no representation or warranty is made as to information
contained in or omitted from the Registration Statement or the Prospectus
in reliance upon and in conformity with written information furnished to
the Company through the Representatives by or on behalf of any Underwriter
specifically for inclusion therein.
(f) The Selling Stockholder has no reason to believe (without having
conducted any investigation or inquiry) that the representations and
warranties of the Company contained in Section 1 hereof are not materially
true and correct, is familiar with the Registration Statement and the
Prospectus (as amended or supplemented) and has no actual knowledge of any
material fact, condition or information not disclosed in the Registration
Statement, as of the effective date, or the Prospectus (or any amendment or
supplement thereto), as of the applicable filing date, which has had or
would reasonably be expected to have a Material Adverse Effect and is not
prompted to sell shares of Common Stock by any information concerning the
Company which is not set forth in the Registration Statement and the
Prospectus; PROVIDED, HOWEVER, with respect to those Selling Stockholders
that are not Management Stockholders, nothing in this Section 2(f) shall be
deemed to constitute a guarantee of the representations and warranties made
by the Company in Section 1 hereof.
(g) The Selling Stockholder has not taken and will not take, directly
or indirectly, any action which is designed to or that would reasonably be
expected to cause or result in the stabilization or manipulation of the
price of the Common Stock to facilitate the sale or resale of the shares of
the Stock.
(h) The Selling Stockholder has not distributed and will not
distribute any prospectus or other offering material in connection with the
offering and sale of the Stock.
(i) All information furnished by or on behalf of the Selling
Stockholder relating to the Selling Stockholder and the Stock to be sold by
the Selling Stockholder that is contained in the representations and
warranties of the Selling Stockholder in the Selling Stockholder's Power of
Attorney or set forth in the Registration Statement or the Prospectus is,
and at the time the Registration Statement became or becomes, as the case
may be, effective and at all times subsequent thereto up to and on the
First Delivery Date, and on the Second Delivery Date, was or will be, true,
correct and complete in all material respects, and does not, and at the
time the Registration Statement became or becomes, as the case may be,
effective and at all times subsequent thereto up to and on
9.
the First Delivery Date, and on the Second Delivery Date, will not, contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make such information not
misleading.
(j) The Selling Stockholder does not have, or has waived prior to the
date hereof, any preemptive right, co-sale right or right of first refusal
or other similar right to purchase any of the Stock that is to be sold by
the Company or any of the other Selling Stockholders to the Underwriters
pursuant to this Agreement; the Selling Stockholder does not have, or has
waived prior to the date hereof, any registration right or other similar
right to participate in the offering made by the Prospectus, other than
such rights of participation as have been satisfied by the participation of
the Selling Stockholder in the transactions to which this Agreement relates
in accordance with the terms of this Agreement; and the Selling Stockholder
does not own any warrants, options or similar rights to acquire, and does
not have any right or arrangement to acquire, any capital stock, rights,
warrants, options or other securities from the Company, other than those
described or referred to in the Registration Statement and the Prospectus.
3. PURCHASE OF THE STOCK BY THE UNDERWRITERS. On the basis of the
representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Company agrees to sell 3,750,000 shares of
the Firm Stock and each Selling Stockholder hereby agrees to sell the number of
shares of the Firm Stock set opposite its/his/her name in Schedule 2 hereto,
severally and not jointly, to the several Underwriters and each of the
Underwriters, severally and not jointly, agrees to purchase the number of shares
of the Firm Stock set opposite that Underwriter's name in Schedule 1 hereto.
Each Underwriter shall be obligated to purchase from the Company, and from each
Selling Stockholder, that number of shares of the Firm Stock that represents the
same proportion of the number of shares of the Firm Stock to be sold by the
Company, and by each Selling Stockholder, as the number of shares of the Firm
Stock set forth opposite the name of such Underwriter in Schedule 1 represents
of the total number of shares of the Firm Stock to be purchased by all of the
Underwriters pursuant to this Agreement. The respective purchase obligations of
the Underwriters with respect to the Firm Stock shall be rounded among the
Underwriters to avoid fractional shares, as the Representatives may determine.
In addition, the Selling Stockholders collectively grant to the
Underwriters an option to purchase up to 862,500 shares of Option Stock. Such
option is granted for the purpose of covering over-allotments in the sale of
Firm Stock and is exercisable as provided in Section 5 hereof. If less than all
of the shares of Option Stock are purchased by the Underwriters, then all
purchases of shares of Option Stock from the Selling Stockholders shall be made
in proportion to, but not greater than, the number of shares of Option Stock set
forth opposite the names of such Selling Stockholders in Schedule 2 hereto.
Shares of Option Stock shall be purchased severally for the account of the
Underwriters in proportion to the number of shares of Firm Stock set forth
opposite the names of such Underwriters in Schedule 1 hereto. The respective
purchase obligations of each Underwriter with respect to the Option Stock shall
be adjusted by the Representatives so that no Underwriter shall be obligated to
purchase Option Stock other than in 100 share amounts. Upon exercise of the
option by the Underwriters, the Selling Stockholders agree to sell to the
Underwriters the number of shares of Option Stock set forth in the notice
delivered pursuant to Section 5 hereof. The price of both the Firm Stock and
any Option Stock shall be $_____ per share.
10.
The Selling Stockholders shall not be obligated to deliver any of the Stock
to be delivered on the First Delivery Date or the Second Delivery Date, as the
case may be, except upon payment for all the Stock to be purchased on such
Delivery Date as provided herein.
4. OFFERING OF STOCK BY THE UNDERWRITERS.
Upon authorization by the Representatives of the release of the Firm
Stock, the several Underwriters shall offer the Firm Stock for sale upon the
terms and conditions set forth in the Prospectus. The Firm Stock initially is
to be offered to the public at the initial public offering price provided for in
Section 3. After the initial public offering, the Representatives may from time
to time increase or decrease the public offering price, in their sole
discretion, by reason of changes in general market conditions or otherwise.
It is understood that 575,000 shares of the Firm Stock will initially be
reserved by the several Underwriters for offer and sale upon the terms and
conditions set forth in the Prospectus and in accordance with the rules and
regulations of the National Association of Securities Dealers, Inc. to employees
and persons having business relationships with the Company and its subsidiaries
who have heretofore delivered to the Representatives offers or indications of
interest to purchase shares of Firm Stock in form satisfactory to the
Representatives, and that any allocation of such Firm Stock among such persons
will be made in accordance with timely directions received by the
Representatives from the Company; PROVIDED THAT, under no circumstances will the
Representatives or any Underwriter be liable to the Company or to any such
person for any action taken or omitted in good faith in connection with such
offering to employees and persons having business relationships with the Company
and its subsidiaries. It is further understood that any shares of such Firm
Stock that are not purchased by such persons will be offered by the Underwriters
to the public upon the terms and conditions set forth in the Prospectus.
5. DELIVERY OF AND PAYMENT FOR THE STOCK. Delivery of and payment for
the Firm Stock shall be made at the office of ▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇, at 10:00 A.M., New York City time, on (a) the
third full business day following the date of this Agreement, (b) if this
Agreement is executed and delivered after 4:30 p.m. Eastern time, the fourth
full business day following the date of this Agreement, or (c) at such other
date or place as shall be determined by agreement between the Representatives
and the Company. This date and time are sometimes referred to as the "First
Delivery Date." On the First Delivery Date, the Company and the Selling
Stockholders shall deliver or cause to be delivered certificates representing
the Firm Stock to the Representatives for the account of each Underwriter
against payment to or upon the order of the Company and the Selling Stockholders
of the purchase price by wire transfer in immediately available funds. Time
shall be of the essence, and delivery at the time and place specified pursuant
to this Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, the Firm Stock shall be registered in such names and
in such denominations as the Representatives shall request in writing not less
than two full business days prior to the First Delivery Date. For the purpose
of expediting the checking and packaging of the certificates for the Firm Stock,
the Company and the Selling Stockholders shall make the certificates
representing the Firm Stock available for inspection by the Representatives in
New York, New York, not later than 2:00 P.M., New York City time, on the
business day prior to the First Delivery Date.
11.
At any time on or before the thirtieth day after the date of this
Agreement, the option granted in Section 3 may be exercised by written notice
being given to the Attorneys-in-Fact on behalf of the Selling Stockholders by
the Representatives. Such notice shall set forth the aggregate number of shares
of Option Stock as to which the option is being exercised, the names in which
the shares of Option Stock are to be registered, the denominations in which the
shares of Option Stock are to be issued and the date and time, as determined by
the Representatives, when the shares of Option Stock are to be delivered;
PROVIDED, HOWEVER, that this date and time shall not be earlier than the First
Delivery Date nor earlier than the third business day after the date on which
the option shall have been exercised nor later than the fifth business day after
the date on which the option shall have been exercised. The date and time the
shares of Option Stock are delivered are sometimes referred to as the "Second
Delivery Date" and the First Delivery Date and the Second Delivery Date are
sometimes each referred to as a "Delivery Date").
Delivery of and payment for the Option Stock shall be made at the place
specified in the first sentence of the first paragraph of this Section 5 (or at
such other place as shall be determined by agreement between the Representatives
and the Attorneys-in-Fact) at 10:00 A.M., New York City time, on the Second
Delivery Date. On the Second Delivery Date, the Selling Stockholders shall
deliver or cause to be delivered the certificates representing the Option Stock
to the Representatives for the account of each Underwriter against payment to or
upon the order of the Selling Stockholders of the purchase price by wire
transfer in immediately available funds. Time shall be of the essence, and
delivery at the time and place specified pursuant to this Agreement is a further
condition of the obligation of each Underwriter hereunder. Upon delivery, the
Option Stock shall be registered in such names and in such denominations as the
Representatives shall request in the aforesaid written notice. For the purpose
of expediting the checking and packaging of the certificates for the Option
Stock, the Selling Stockholders shall make the certificates representing the
Option Stock available for inspection by the Representatives in New York, New
York, not later than 2:00 P.M., New York City time, on the business day prior to
the Second Delivery Date.
6. FURTHER AGREEMENTS OF THE COMPANY. The Company agrees:
(a) To prepare the Prospectus in a form approved by the
Representatives and to file such Prospectus pursuant to Rule 424(b) under
the Securities Act not later than the Commission's close of business on the
second business day following the execution and delivery of this Agreement
or, if applicable, such earlier time as may be required by Rule 430A(a)(3)
under the Securities Act; to make no further amendment or any supplement to
the Registration Statement or to the Prospectus except as permitted herein;
to advise the Representatives, promptly after it receives notice thereof,
of the time when any amendment to the Registration Statement has been filed
or becomes effective or any supplement to the Prospectus or any amended
Prospectus has been filed and to furnish the Representatives with copies
thereof; to advise the Representatives, promptly after it receives notice
thereof, of the issuance by the Commission of any stop order or of any
order preventing or suspending the use of any Preliminary Prospectus or the
Prospectus, of the suspension of the qualification of the Stock for
offering or sale in any jurisdiction, of the initiation or threatening of
any proceeding for any such purpose, or of any request by the Commission
for the amending or supplementing of the Registration Statement or the
Prospectus or for additional information; and, in the event of the issuance
of any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or
12.
the Prospectus or suspending any such qualification, to use promptly its
best efforts to obtain its withdrawal;
(b) To furnish promptly to each of the Representatives and to counsel
for the Underwriters a copy of the Registration Statement as originally
filed with the Commission, and each amendment thereto filed with the
Commission, including all consents and exhibits filed therewith;
(c) To deliver promptly to the Representatives such number of the
following documents as the Representatives shall reasonably request: (i)
conformed copies of the Registration Statement as originally filed with the
Commission and each amendment thereto (in each case excluding exhibits
other than this Agreement and the computation of per share earnings) and
(ii) each Preliminary Prospectus, the Prospectus and any amended or
supplemented Prospectus; and, if the delivery of a prospectus is required
at any time after the Effective Time in connection with the offering or
sale of the Stock or any other securities relating thereto and if at such
time any events shall have occurred as a result of which the Prospectus as
then amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made when such Prospectus is delivered, not misleading, or, if for any
other reason it shall be necessary to amend or supplement the Prospectus in
order to comply with the Securities Act, to notify the Representatives and
to file such document and to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many copies as the
Representatives may from time to time reasonably request of an amended or
supplemented Prospectus that will correct such statement or omission or
effect such compliance;
(d) To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the
Prospectus that may, in the judgment of the Company or the Representatives,
be required by the Securities Act or requested by the Commission, including
any abbreviated registration statement pursuant to Rule 462(b) of the Rules
and Regulations;
(e) Prior to filing with the Commission any amendment to the
Registration Statement or supplement to the Prospectus or any Prospectus
pursuant to Rule 424 of the Rules and Regulations, to furnish a copy
thereof to the Representatives and counsel for the Underwriters and not to
make any such filing to which the Representatives object in writing,
subject to compliance with the Securities Act and the Rules and Regulations
and the provisions of this Agreement;
(f) As soon as practicable after the Effective Date (it being
understood that the Company shall have until at least 410 or, if the fourth
quarter following the fiscal quarter that includes the Effective Date is
the last fiscal quarter of the Company's fiscal year, 455 days after the
end of the Company's current fiscal quarter), to make generally available
to the Company's security holders and to deliver to the Representatives an
earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Securities Act and the Rules
and Regulations (including, at the option of the Company, Rule 158);
13.
(g) For a period of five years following the Effective Date, to
furnish to the Representatives copies of all materials furnished by the
Company to its stockholders and all public reports and all reports and
financial statements furnished by the Company to the principal national
securities exchange upon which the Common Stock may be listed pursuant to
requirements of or agreements with such exchange or to the Commission
pursuant to the Exchange Act or any rule or regulation of the Commission
thereunder;
(h) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify the Stock for offering
and sale under the securities laws of such jurisdictions within the United
States as the Representatives may request and to comply with such laws so
as to permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the distribution
of the Stock; PROVIDED that in connection therewith the Company shall not
be required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
(i) For a period of 180 days from the date of the Prospectus, not to,
directly or indirectly, (1) offer for sale, sell, pledge or otherwise
dispose of (or enter into any transaction or device which is designed to,
or would reasonably be expected to, result in the disposition by any person
at any time in the future of) any shares of Common Stock or securities
convertible into or exchangeable for Common Stock (other than the Stock and
shares issued pursuant to employee benefit plans, qualified stock option
plans or other incentive plans existing on the date hereof or pursuant to
currently outstanding options, warrants or rights), or sell or grant
options, rights or warrants with respect to any shares of Common Stock or
securities convertible into or exchangeable for Common Stock (other than
the grant of options or other awards pursuant to incentive plans existing
on the date hereof), or (2) enter into any swap or other derivatives
transaction that transfers to another, in whole or in part, any of the
economic benefits or risks of ownership of such shares of Common Stock,
whether any such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or other securities, in cash or
otherwise, in each case without the prior written consent of ▇▇▇▇▇▇
Brothers Inc.; and to use reasonable efforts to cause each officer,
director and stockholder of the Company to furnish to the Representatives,
prior to the First Delivery Date, a letter or letters, in form and
substance satisfactory to counsel for the Underwriters, pursuant to which
each such person shall agree not to, directly or indirectly, (1) offer for
sale, sell, pledge or otherwise dispose of (or enter into any transaction
or device that is designed to, or could be expected to, result in the
disposition by any person at any time in the future of) any shares of
Common Stock or securities convertible into or exchangeable for Common
Stock or (2) enter into any swap or other derivatives transaction that
transfers to another, in whole or in part, any of the economic benefits or
risks of ownership of such shares of Common Stock, whether any such
transaction described in clause (1) or (2) above is to be settled by
delivery of Common Stock or other securities, in cash or otherwise, in each
case for a period of 180 days from the date of the Prospectus, without the
prior written consent of ▇▇▇▇▇▇ Brothers Inc.;
(j) Prior to filing with the Commission any reports on Forms 1Q-Q or
10-K containing information required pursuant to Rule 463 of the Rules and
Regulations, to
14.
furnish a copy of such information to the counsel for the Underwriters and
receive and consider its comments thereon;
(k) To apply the net proceeds from the sale of the Stock being sold
by the Company as set forth in the Prospectus; and
(l) To maintain a transfer agent and, if necessary under the
jurisdiction of incorporation of the Company, a registrar (which may be the
same entity as the transfer agent) for its Common Stock.
7. Each Selling Stockholder agrees:
(a) For a period of 180 days from the date of the Prospectus, not to,
directly or indirectly, (1) offer for sale, sell, pledge or otherwise
dispose of (or enter into any transaction or device which is designed to,
or would reasonably be expected to, result in the disposition by any person
at any time in the future of) any shares of Common Stock or securities
convertible into or exchangeable for Common Stock (other than the Stock),
or (2) enter into any swap or other derivatives transaction that transfers
to another, in whole or in part, any of the economic benefits or risks of
ownership of such shares of Common Stock, whether any such transaction
described in clause (1) or (2) above is to be settled by delivery of Common
Stock or other securities, in cash or otherwise, in each case without the
prior written consent of ▇▇▇▇▇▇ Brothers Inc.
(b) That the Stock to be sold by the Selling Stockholder hereunder
that is represented by the certificates held in custody by the Custodian
for the Selling Stockholder, is subject to the interest of the Underwriters
and the other Selling Stockholders thereunder that the arrangements made by
the Selling Stockholder for such custody are to that extent irrevocable,
and that the obligations of the Selling Stockholder hereunder shall not be
terminated by any act of the Selling Stockholder, by operation of law, by
the death or incapacity of any individual Selling Stockholder or, in the
case of a trust, by the death or incapacity of any executor or trustee or
the termination of such trust, or the occurrence of any other event.
(c) To deliver to the Representatives prior to the First Delivery
Date a properly completed and executed United States Treasury Department
Form W-8 (if the Selling Stockholder is a non-United States person) or Form
W-9 (if the Selling Stockholder is a United States person.)
8. EXPENSES. The Company agrees to pay (a) the costs incident to the
authorization, issuance, sale and delivery of the Stock and any taxes payable in
that connection; (b) the costs incident to the preparation, printing and filing
under the Securities Act of the Registration Statement and any amendments and
exhibits thereto; (c) the costs of distributing the Registration Statement as
originally filed and each amendment thereto and any post-effective amendments
thereof (including, in each case, exhibits), any Preliminary Prospectus, the
Prospectus and any amendment or supplement to the Prospectus, all as provided in
this Agreement; (d) the costs of producing and distributing this Agreement and
any other related documents in connection with the offering, purchase, sale and
delivery of the Stock; (e) the costs of delivering and distributing the Custody
Agreements and the Powers of Attorney; (f) the filing fees incident to securing
any
15.
required review by the National Association of Securities Dealers, Inc. of the
terms of sale of the Stock; (g) any applicable listing or other fees; (h) the
fees and expenses (not in excess, in the aggregate, of $5,000) of qualifying the
Stock under the securities laws of the several jurisdictions as provided in
Section 6 (h) and of preparing, printing and distributing a Blue Sky Memorandum;
(i) all costs and expenses (not in excess, in the aggregate, of $10,000) of the
Underwriters, including the fees and disbursements of counsel for the
Underwriters, incident to the offer and sale of shares of the Stock by the
Underwriters to employees and persons having business relationships with the
Company and its subsidiaries, as described in Section 4; (j) the fees and
expenses of one counsel for the Selling Stockholders as a group; and (k) all
other costs and expenses incident to the performance of the obligations of the
Company and the Selling Stockholders under this Agreement; PROVIDED that, except
as provided in this Section 8 and in Section 13, the Underwriters shall pay
their own costs and expenses, including the costs and expenses of their counsel,
any transfer taxes on the Stock which they may sell, the fees and expenses of
qualifying the Stock under the securities laws of the several jurisdictions and
of preparing, printing and distributing a Blue Sky Memorandum to the extent such
fees and expenses exceed the amount to be paid by the Company pursuant to
Section 8(h) above, the expenses of advertising any offering of the Stock made
by the Underwriters and stabilization costs, if any, and each Selling
Stockholder shall pay any transfer taxes payable in connection with such
stockholder's sale of Stock to the Underwriters.
9. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The respective obligations
of the Underwriters hereunder are subject to the accuracy, when made and on each
Delivery Date, of the representations and warranties of the Company and the
Selling Stockholders contained herein, to the performance by the Company and the
Selling Stockholders of their respective obligations hereunder, and to each of
the following additional terms and conditions:
(a) The Prospectus shall have been timely filed with the Commission
in accordance with Section 6(a); no stop order suspending the effectiveness
of the Registration Statement or any part thereof shall have been issued
and no proceeding for that purpose shall have been initiated or threatened
by the Commission; and any request of the Commission for inclusion of
additional information in the Registration Statement or the Prospectus or
otherwise shall have been complied with.
(b) No Underwriter shall have discovered after the Effective Time and
disclosed to the Company on or prior to such Delivery Date that (i) the
Registration Statement or any amendment or supplement thereto contains an
untrue statement of a fact which, in the opinion of ▇▇▇▇▇▇ Godward LLP,
counsel for the Underwriters, is material or omits to state a fact which,
in the opinion of such counsel, is material and is required to be stated
therein or is necessary to make the statements therein not misleading or
(ii) the Prospectus or any amendment or supplement thereto contains an
untrue statement of a fact which, in the opinion of ▇▇▇▇▇▇ Godward LLP, is
material or omits to state a fact, which in the opinion of such counsel, is
material and is required to be stated therein or is necessary to make the
statements therein not misleading, in light of the circumstances under
which they were made.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Custody Agreements,
the Powers
16.
of Attorney, the Stock, the Registration Statement and the Prospectus, and
all other legal matters relating to this Agreement and the transactions
contemplated hereby shall be reasonably satisfactory in all material
respects to counsel for the Underwriters, and the Company and the Selling
Stockholders shall have furnished to such counsel all documents and
information that they may reasonably request to enable them to pass upon
such matters.
(d) ▇▇▇▇▇ & ▇▇▇▇▇▇ LLP shall have furnished to the Representatives
its written opinion, as counsel to the Company, addressed to the
Underwriters and dated such Delivery Date, in substantially the form set
forth in EXHIBIT A hereto.
(e) ▇▇▇▇▇ & ▇▇▇▇▇▇, as counsel for the Selling Stockholders, shall
have furnished to the Representatives its written opinion addressed to the
Underwriters and dated such Delivery Date, in substantially the form set
forth in EXHIBIT B hereto.
(f) The Representatives shall have received from ▇▇▇▇▇▇ Godward LLP,
counsel for the Underwriters, such opinion or opinions, dated such Delivery
Date, with respect to the issuance and sale of the Stock, the Registration
Statement, the Prospectus and other related matters as the Representatives
may reasonably require, and the Company shall have furnished to such
counsel such documents as they reasonably request for the purpose of
enabling them to pass upon such matters.
(g) At the time of execution of this Agreement, the Representatives
shall have received from KPMG a letter, in form and substance satisfactory
to the Representatives, addressed to the Underwriters and dated the date
hereof (the "Initial Letter"), confirming that they are independent public
accountants within the meaning of the Securities Act and are in compliance
with the applicable requirements relating to the qualification of
accountants under Rule 2-01 of Regulation S-X of the Commission. The
Initial Letter also shall (i) set forth the opinion of KPMG with respect to
its examination of the consolidated balance sheet of the Company as of
December 31, 1997 and related consolidated statements of operations,
stockholders' equity and cash flows for the twelve (12) months ended
December 31, 1997, (ii) state that KPMG has performed the procedures set
out in Statement on Auditing Standards No. 71 ("SAS 71") for a review of
interim financial information and providing the report of KPMG as described
in SAS 71 on the financial statements for each of the quarters in the
five-quarter period ended March 31, 1998 (the "Quarterly Financial
Statements"), (iii) state that in the course of such review, nothing came
to its attention that leads it to believe that any material modifications
need to be made to any of the Quarterly Financial Statements in order for
them to be in compliance with generally accepted accounting principles
consistently applied across the periods presented and (iv) address other
matters agreed upon by KPMG and the Representatives. In addition, the
Representatives shall have received from KPMG a letter addressed to the
Company and made available to the Representatives for the use of the
Underwriters stating that its review of the Company's system of internal
accounting controls, to the extent it deemed necessary in establishing the
scope of its examination of the Company's consolidated financial statements
as of December 31, 1997, did not disclose any weaknesses in internal
controls that it considered to be material weaknesses.
17.
(h) On such Delivery Date, the Company shall have furnished to the
Representatives a letter of KPMG addressed to the Underwriters and dated
such Delivery Date (the "Bring-Down Letter") (i) confirming that they are
independent public accountants within the meaning of the Securities Act and
are in compliance with the applicable requirements relating to the
qualification of accountants under Rule 2-01 of Regulation S-X of the
Commission and (ii) based upon the procedures described in the Initial
Letter, but carried out to a date not more than five (5) business days
prior to such Delivery Date, confirming, to the extent true, that the
statements and conclusions set forth in the Initial Letter are accurate as
of such Delivery Date and setting forth any revisions and additions to the
statements and conclusions set forth in the Initial Letter that are
necessary to reflect any changes in the facts described in the Initial
Letter since the date of such letter, or to reflect the availability of
more recent financial statements, data or information. The Bring-Down
Letter shall not disclose any change in the condition (financial or
otherwise), earnings, operations, business or business prospects of the
Company and its subsidiaries considered as one enterprise from that set
forth in the Registration Statement or Prospectus, which, in the
Representatives' sole judgment, is material and adverse and that makes it,
in the Representatives' sole judgment, impracticable or inadvisable to
proceed with the public offering of the Stock as contemplated by the
Prospectus.
(i) ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ shall have furnished to the Representatives its
written opinion, as patent counsel to the Company, addressed to the
Underwriters and dated such Delivery Date, in form and substance reasonably
satisfactory to the Representatives, to the effect that such counsel is
familiar with the technology used by the Company in its business and the
manner of its use thereof and has read the Registration Statement and the
Prospectus, including particularly the portions of the Registration
Statement and the Prospectus referring to patents, trade secrets,
trademarks, service marks or other proprietary information or materials
and:
(i) The statements in the Registration Statement and the
Prospectus under the captions "Risk Factors - Patents and Protection
of Proprietary Technology," "Business -- Design and Development --
Patent Review" and "-- Patents," to the best of such counsel's
knowledge and belief, are accurate and complete statements or
summaries of the legal matters therein set forth and nothing has come
to such counsel's attention that causes such counsel to believe that
the above-described portions of the Registration Statement, as of the
Effective Date, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading or
that, as of the date thereof and as of such Delivery Date, the
above-described portions of the Prospectus contained or contains any
untrue statement of a material fact or omits to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they
were made, not misleading.
(ii) to the best of such counsel's knowledge, there are no
legal or governmental proceedings pending relating to patent rights,
trade secrets, trademarks, service marks or other proprietary
information or materials of the
18.
Company or any of its subsidiaries and, to the best of such counsel's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or others;
(iii) such counsel do not know of any contracts or other
documents, relating to governmental regulation affecting the Company
or any of its subsidiaries or the patents, trade secrets, trademarks,
service marks or other proprietary information or materials of the
Company or any of its subsidiaries, of a character required to be
filed as an exhibit to the Registration Statement or required to be
described in the Registration Statement or the Prospectus that are not
filed or described as required;
(iv) to the best of such counsel's knowledge, neither the
Company nor any of its subsidiaries is infringing or otherwise
violating any patents, trade secrets, trademarks, service marks or
other proprietary information or materials, of others and, to the best
of such counsel's knowledge, there are no infringements by others of
any of the patents, trade secrets, trademarks, service marks or other
proprietary information or materials of the Company or any of its
subsidiaries which, in the judgment of such counsel, could affect
materially the use thereof by the Company or any such subsidiary; and
(v) to the best of such counsel's knowledge, the Company and
its subsidiaries own or possess sufficient licenses or other rights to
use all patents, trade secrets, trademarks, service marks or other
proprietary information or materials necessary to conduct the business
now being or proposed to be conducted by the Company and its
subsidiaries as described in the Prospectus.
(j) The Company shall have furnished to the Representatives a
certificate, dated such Delivery Date, of its Chief Executive Officer and
its Chief Financial Officer stating that:
(i) The representations, warranties and agreements of the
Company in Section 1 are true and correct as of such Delivery Date;
the Company has complied with all its agreements contained herein; and
the conditions set forth in Sections 9(a) through 9(n) have been
fulfilled; and
(ii) They have carefully examined the Registration Statement
and the Prospectus and, to their knowledge, since the Effective Date,
no event has occurred that should have been set forth in a supplement
or amendment to the Registration Statement or the Prospectus.
(k) Each Selling Stockholder (or the Custodian or one or more
Attorneys-in-Fact on behalf of the Selling Stockholders) shall have
furnished to the Representatives on such Delivery Date a certificate, dated
such Delivery Date, signed by, or on behalf of, such Selling Stockholder
(or the Custodian or one or more Attorneys-in-Fact) stating that the
representations, warranties and agreements of such Selling Stockholder
contained herein are true and correct as of such Delivery Date and that
such Selling Stockholder has
19.
complied with all agreements contained herein to be performed by such
Selling Stockholder at or prior to such Delivery Date.
(l) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest financial statements included in the
Prospectus any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus or (ii) since such date
there shall not have been any change in the capital stock or long-term debt
of the Company or any of its subsidiaries or any change, or any development
involving a prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as set forth
or contemplated in the Prospectus, the effect of which, in any such case
described in clause (i) or (ii), is, in the reasonable judgment of the
Representatives, so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Stock being delivered on such Delivery Date on the terms and in the manner
contemplated in the Prospectus.
(m) Subsequent to the execution and delivery of this Agreement there
shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange or the American Stock Exchange or
in the over-the-counter market shall have been suspended or minimum prices
shall have been established on any such exchange or such market by the
Commission, by such exchange or by any other regulatory body or
governmental authority having jurisdiction, (ii) a banking moratorium shall
have been declared by federal or state authorities, (iii) the United States
shall have become engaged in hostilities, there shall have been an
escalation in hostilities involving the United States or there shall have
been a declaration of a national emergency or war by the United States or
(iv) there shall have occurred such a material adverse change in general
economic, political or financial conditions (or the effect of international
conditions on the financial markets in the United States shall be such) as
to make it, in the judgment of a majority in interest of the several
Underwriters, impracticable or inadvisable to proceed with the public
offering or delivery of the Stock being delivered on such Delivery Date on
the terms and in the manner contemplated in the Prospectus.
(n) The Nasdaq National Market shall have approved the Stock for
quotation, subject only to official notice of issuance and evidence of
satisfactory distribution.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Underwriters.
20.
10. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company shall indemnify and hold harmless each Underwriter,
its officers and employees and each person, if any, who controls any Underwriter
within the meaning of the Securities Act, from and against any loss, claim,
damage or liability, joint or several, or any action in respect thereof
(including, but not limited to, any loss, claim, damage, liability or action
relating to purchases and sales of Stock), to which that Underwriter, officer,
employee or controlling person may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon (i) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amendment or
supplement thereto or the omission or alleged omission to state therein any
material fact required to be stated therein or necessary to make the statements
therein not misleading, (ii) any untrue statement or alleged untrue statement of
a material fact contained in the Prospectus or any amendment or supplement
thereto or the omission or alleged omission to state therein any material fact
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances under which they were made, (iii) any
untrue statement or alleged untrue statement contained in any blue sky
application or other document prepared or executed by the Company (or based upon
any written information furnished by the Company) specifically for the purpose
of qualifying any or all of the Stock under the securities laws of any state or
other jurisdiction (any such application, document or information being
hereinafter called a "Blue Sky Application") or (iv) any act or failure to act
or any alleged act or failure to act by any Underwriter in connection with, or
relating in any manner to, the Stock or the offering contemplated hereby, and
which is included as part of or referred to in any loss, claim, damage,
liability or action arising out of or based upon matters covered by clause (i),
(ii) or (iii) above (provided that the Company shall not be liable under this
clause (iv) to the extent that it is determined in a final judgment by a court
of competent jurisdiction that such loss, claim, damage, liability or action
resulted directly from any such acts or failures to act undertaken or omitted to
be taken by such Underwriter through its gross negligence or willful
misconduct), and shall reimburse each Underwriter and each such officer,
employee or controlling person promptly upon demand for any legal or other
expenses reasonably incurred by that Underwriter, officer, employee or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred; PROVIDED, HOWEVER, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary Prospectus,
the Registration Statement or the Prospectus, or in any such amendment or
supplement, or in any Blue Sky Application, in reliance upon and in conformity
with written information furnished to the Company through the Representatives by
or on behalf of any Underwriter specifically for inclusion therein; PROVIDED,
FURTHER, that the indemnity agreement contained in this Section 10(a) with
respect to any Prospectus shall not inure to the benefit of any Underwriter (or
any persons controlling such Underwriter) on account of any losses, claims,
damages, liabilities or litigation arising from the sale of Stock to any person,
if such Underwriter fails to send or give a copy of the Prospectus, as the same
may be then supplemented or amended, to such person, within the time required by
the Securities Act and the untrue statement or alleged untrue statement or
omission or alleged omission of a material fact contained in such
21.
Prospectus was corrected therein. The foregoing indemnity agreement is in
addition to any liability that the Company may otherwise have to any Underwriter
or to any officer, employee or controlling person of that Underwriter.
(b) The Management Stockholders, severally and not jointly, shall
indemnify and hold harmless each Underwriter, its officers and employees, and
each person, if any, who controls any Underwriter within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof (including, but not limited to, any
loss, claim, damage, liability or action relating to purchases and sales of
Stock), to which that Underwriter, officer, employee or controlling person may
become subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus or in any
amendment or supplement thereto or (ii) the omission or alleged omission to
state in any Preliminary Prospectus, Registration Statement or the Prospectus,
or in any amendment or supplement thereto, any material fact required to be
stated therein or necessary to make the statements therein not misleading, and
shall reimburse each Underwriter, its officers and employees and each such
controlling person for any legal or other expenses reasonably incurred by that
Underwriter, its officers and employees or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred; PROVIDED, HOWEVER,
that the Management Stockholders shall not be liable in any such case to the
extent that any such loss, claim, damage, liability or action arises out of, or
is based upon, any untrue statement or alleged untrue statement or omission or
alleged omission made in any Preliminary Prospectus, the Registration Statement
or the Prospectus or in any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company through the
Representatives by or on behalf of any Underwriter specifically for inclusion
therein; PROVIDED, FURTHER, that the indemnity agreement contained in this
Section 10(b) with respect to any Prospectus shall not inure to the benefit of
any Underwriter (or any persons controlling such Underwriter) on account of any
losses, claims, damages, liabilities or litigation arising from the sale of
Stock to any person, if such Underwriter fails to send or give a copy of the
Prospectus, as the same may be then supplemented or amended, to such person,
within the time required by the Securities Act and the untrue statement or
alleged untrue statement or omission or alleged omission of a material fact
contained in such Prospectus was subsequently corrected. The foregoing
indemnity agreement is in addition to any liability that the Management
Stockholders may otherwise have to any Underwriter or any officer, employee or
controlling person of that Underwriter.
(c) The Selling Stockholders who are not Management Stockholders,
severally and not jointly, shall indemnify and hold harmless each Underwriter,
its officers and employees, and each person, if any, who controls any
Underwriter within the meaning of the Securities Act, from and against any loss,
claim, damage or liability, joint or several, or any action in respect thereof
(including, but not limited to, any loss, claim, damage, liability or action
relating to purchases and sales of Stock), to which that Underwriter, officer,
employee or controlling person may become subject, under the Securities Act or
otherwise, insofar as such
22.
loss, claim, damage, liability or action arises out of, or is based upon, (i)
any untrue statement or alleged untrue statement of a material fact concerning
such Selling Stockholder contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus or in any amendment or supplement
thereto or (ii) the omission or alleged omission to state in any Preliminary
Prospectus, Registration Statement or the Prospectus, or in any amendment or
supplement thereto, any material fact required to be stated therein or necessary
to make the statements therein not misleading, and shall reimburse each
Underwriter, its officers and employees and each such controlling person for any
legal or other expenses reasonably incurred by that Underwriter, its officers
and employees or controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action as such expenses are incurred; PROVIDED, HOWEVER, that the Selling
Stockholders shall not be liable in any such case to the extent that any such
loss, claim, damage, liability or action arises out of, or is based upon, any
untrue statement or alleged untrue statement or omission or alleged omission
made in any Preliminary Prospectus, the Registration Statement or the Prospectus
or in any such amendment or supplement in reliance upon and in conformity with
written information furnished to the Company through the Representatives by or
on behalf of any Underwriter specifically for inclusion therein; PROVIDED,
FURTHER, that the indemnity agreement contained in this Section 10(c) with
respect to any Prospectus shall not inure to the benefit of any Underwriter (or
any persons controlling such Underwriter) on account of any losses, claims,
damages, liabilities or litigation arising from the sale of Stock to any person,
if such Underwriter fails to send or give a copy of the Prospectus, as the same
may be then supplemented or amended, to such person, within the time required by
the Securities Act and the untrue statement or alleged untrue statement or
omission or alleged omission of a material fact contained in such Prospectus was
subsequently corrected. The foregoing indemnity agreement is in addition to any
liability that the Selling Stockholders may otherwise have to any Underwriter or
any officer, employee or controlling person of that Underwriter.
(d) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Company, its officers and employees, each of its directors
(including any person who, with his or her consent, is named in the Registration
Statement as about to become a director of the Company), each person, if any,
who controls the Company within the meaning of the Securities Act and each
Selling Stockholder (including each Management Stockholder), from and against
any loss, claim, damage or liability, joint or several, or any action in respect
thereof, to which the Company or any such director, officer or controlling
person may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained (A) in any Preliminary Prospectus, the Registration Statement or the
Prospectus or in any amendment or supplement thereto, or (B) in any Blue Sky
Application or (ii) the omission or alleged omission to state in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any amendment or
supplement thereto, or in any Blue Sky Application any material fact required to
be stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that the 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 through the
Representatives by or on behalf of that Underwriter specifically for inclusion
therein, and shall reimburse the Company and any such director, officer or
controlling person for any legal or other expenses reasonably incurred by the
Company or any such director, officer or controlling person in connection with
investigating
23.
or defending or preparing to defend against any such loss, claim, damage,
liability or action as such expenses are incurred. The foregoing indemnity
agreement is in addition to any liability that any Underwriter may otherwise
have to the Company or any such director, officer, employee or controlling
person.
(e) Promptly after receipt by an indemnified party under this Section
10 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 10, notify the indemnifying party in
writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that
the failure to notify the indemnifying party shall not relieve it from any
liability that it may have under this Section 10 except to the extent it has
been materially prejudiced by such failure and, PROVIDED FURTHER, that the
failure to notify the indemnifying party shall not relieve it from any liability
that it may have to an indemnified party otherwise than under this Section 10.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice
from the indemnifying party to the indemnified party of its election to assume
the defense of such claim or action, the indemnifying party shall not be liable
to the indemnified party under this Section 10 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; PROVIDED, HOWEVER, that
the Representatives shall have the right to employ counsel to represent jointly
the Representatives and those other Underwriters and its respective officers,
employees and controlling persons who may be subject to liability arising out of
any claim in respect of which indemnity may be sought by the Underwriters
against the Company or any Selling Stockholder under this Section 10 if, in the
reasonable judgment of the Representatives, it is advisable for the
Representatives and those Underwriters, officers, employees and controlling
persons to be jointly represented by counsel separate from counsel to the
Company or any Selling Stockholder, and in that event the fees and expenses of
such separate counsel shall be paid by the Company or the Selling Stockholders.
In no event shall the indemnifying parties be liable for fees and expenses of
more than one counsel (in addition to local counsel) for all indemnified parties
in connection with any one action or separate but similar or related actions in
the same jurisdiction arising out of the same set of allegations or
circumstances. The counsel with respect to which fees and expenses shall be so
reimbursed shall be designated in writing by ▇▇▇▇▇▇ Brothers Inc. in the case of
parties indemnified pursuant to Sections 10(a), 10(b) and 10(c) and by the
Company in the case of parties indemnified pursuant to Section 10(d). No
indemnifying party shall (i) without the prior written consent of the
indemnified parties (which consent shall not be unreasonably withheld), settle
or compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action,
suit or proceeding, or (ii) be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with the consent of the indemnifying party or if there
be a final judgment of the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any
24.
indemnified party from and against any loss or liability by reason of such
settlement or judgment.
(f) If the indemnification provided for in this Section 10 shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Section 10(a), 10(b) or 10(c) in respect of any loss, claim, damage
or liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company and the Selling Stockholders, on the one hand, and the
Underwriters, on the other hand, from the offering of the Stock or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and
the Selling Stockholders, on the one hand, and the Underwriters, on the other
hand, with respect to the statements or omissions that resulted in such loss,
claim, damage or liability, or action in respect thereof, as well as any other
relevant equitable considerations. The relative benefits received by the
Company and the Selling Stockholders, on the one hand, and the Underwriters, on
the other hand, with respect to such offering shall be deemed to be in the same
proportion as the total net proceeds from the offering of the Stock purchased
under this Agreement (before deducting expenses) received by the Company and the
Selling Stockholders, on the one hand, and the total underwriting discounts and
commissions received by the Underwriters with respect to the shares of the Stock
purchased under this Agreement, on the other hand, bear to the total gross
proceeds from the offering of the shares of the Stock under this Agreement, in
each case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to whether the untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company, the Selling
Stockholders or the Underwriters, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company, the Selling Stockholders and the
Underwriters agree that it would not be just and equitable if contributions
pursuant to this Section 10(e) were to be determined by pro rata 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 herein. The amount paid or payable by an indemnified
party as a result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section 10 shall be deemed to include, for
purposes of this Section 10(e), any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 10(e), no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Stock underwritten by it and distributed
to the public was offered to the public exceeds the amount of any damages that
such Underwriter has otherwise paid or become liable to pay by reason of any
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The Underwriters' obligations
to contribute as provided in this Section 10(e) are several in proportion to its
respective underwriting obligations and not joint.
25.
(g) The Underwriters severally confirm and the Company acknowledges
that the statements with respect to the public offering of the Stock by the
Underwriters set forth on the cover page of, the legend concerning
over-allotments and other stabilizing activities on the inside front cover page
of, and the information appearing in the third paragraph under the caption
"Underwriting" in the Prospectus is correct and constitutes the only information
furnished in writing to the Company by or on behalf of the Underwriters
specifically for inclusion in the Registration Statement and the Prospectus.
(h) Notwithstanding any other provision of this Agreement, no Selling
Stockholder (including each Management Stockholder) against whom a claim for
indemnity is made on the basis of the provisions of Section 10(b) or 10(c),
against whom contribution is sought on the basis of Section 10(f), or against
whom any claim is otherwise pursued under this Agreement after the First
Delivery Date shall be required to indemnify, hold harmless, reimburse or
otherwise be liable to the Company or Underwriters in an aggregate amount in
excess of the proceeds received by the Selling Stockholder in connection
herewith.
11. DEFAULTING UNDERWRITERS.
If, on either Delivery Date, any Underwriter defaults in the
performance of its obligations under this Agreement, the remaining
non-defaulting Underwriters shall be obligated to purchase the Stock that the
defaulting Underwriter agreed but failed to purchase on such Delivery Date in
the respective proportions that the number of shares of the Firm Stock set
opposite the name of each remaining non-defaulting Underwriter in Schedule 1
hereto bears to the total number of shares of the Firm Stock set opposite the
names of all the remaining non-defaulting Underwriters in Schedule 1 hereto;
PROVIDED, HOWEVER, that the remaining non-defaulting Underwriters shall not be
obligated to purchase any of the Stock on such Delivery Date if the total number
of shares of the Stock which the defaulting Underwriter or Underwriters agreed
but failed to purchase on such date exceeds 9.09% of the total number of shares
of the Stock to be purchased on such Delivery Date, and any remaining
non-defaulting Underwriter shall not be obligated to purchase more than 110% of
the number of shares of the Stock which it agreed to purchase on such Delivery
Date pursuant to the terms of Section 3. If the foregoing maximums are
exceeded, the remaining non-defaulting Underwriters, or those other underwriters
satisfactory to the Representatives who so agree, shall have the right, but
shall not be obligated, to purchase, in such proportion as may be agreed upon
among them, all the Stock to be purchased on such Delivery Date. If the
remaining Underwriters or other underwriters satisfactory to the Representatives
do not elect to purchase the shares that the defaulting Underwriter or
Underwriters agreed but failed to purchase on such Delivery Date, this Agreement
(or, with respect to the Second Delivery Date, the obligation of the
Underwriters to purchase, and of the Company to sell, the Option Stock) shall
terminate without liability on the part of any non-defaulting Underwriter or the
Company or the Selling Stockholders, except that the Company and the
Underwriters will continue to be liable for the payment of expenses to the
extent set forth in Sections 8 and 13. As used in this Agreement, the term
"Underwriter" includes, for all purposes of this Agreement unless the context
requires otherwise, any party not listed in Schedule 1 hereto who, pursuant to
this Section 11, purchases Firm Stock that a defaulting Underwriter agreed but
failed to purchase.
Nothing contained herein shall relieve a defaulting Underwriter of any
liability it may have to the Company and the Selling Stockholders for damages
caused by its default. If other
26.
Underwriters are obligated or agree to purchase the Stock of a defaulting or
withdrawing Underwriter, either the Representatives or the Company may postpone
the Delivery Date for up to seven full business days in order to effect any
changes that in the opinion of counsel for the Company or counsel for the
Underwriters may be necessary in the Registration Statement, the Prospectus or
in any other document or arrangement.
12. TERMINATION. The obligations of the Underwriters hereunder may be
terminated by the Representatives by notice given to and received by the Company
and the Selling Stockholders prior to delivery of and payment for the Firm Stock
if, prior to that time, any of the events described in Sections 9(l) or 9(m),
shall have occurred or if the Underwriters shall decline to purchase the Stock
for any reason permitted under this Agreement.
13. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the Company or any
Selling Stockholder shall fail to tender the Stock for delivery to the
Underwriters by reason of any failure, refusal or inability on the part of the
Company or the Selling Stockholder(s) to perform any agreement on its part to be
performed, or because any other condition of the Underwriters' obligations
hereunder required to be fulfilled by the Company or the Selling Stockholder(s)
is not fulfilled, the Company and the Selling Stockholder(s) will reimburse the
Underwriters for all reasonable out-of-pocket expenses (including fees and
disbursements of counsel) incurred by the Underwriters in connection with this
Agreement and the proposed purchase of the Stock, and upon demand the Company
and the Selling Stockholders shall pay the full amount thereof to the
Representative(s). If this Agreement is terminated pursuant to Section 11 by
reason of the default of one or more Underwriters, neither the Company nor any
Selling Stockholder shall be obligated to reimburse any defaulting Underwriter
on account of those expenses.
14. NOTICES, ETC. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail, telex
or facsimile transmission to ▇▇▇▇▇▇ Brothers Inc., Three World Financial
Center, New York, New York 10285, Attention: Syndicate Department (Fax:
▇▇▇-▇▇▇-▇▇▇▇), with a copy, in the case of any notice pursuant to Section
10(d), to the Director of Litigation, Office of the General Counsel, ▇▇▇▇▇▇
Brothers Inc., ▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇;
(b) if to the Company, shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇ (Fax: ▇▇▇-▇▇▇-▇▇▇▇), with
a copy to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (Fax: ▇▇▇-▇▇▇-▇▇▇▇);
(c) if to any Selling Stockholders, shall be delivered or sent by
mail, telex or facsimile transmission to such Selling Stockholder at the
address set forth on Schedule 2 hereto, with copies to ▇.▇. ▇▇▇▇▇ and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ as Attorneys-In-Fact c/o the Company as set forth in
Section 14(b) above and to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, also as set forth in Section
14(b) above;
PROVIDED, HOWEVER, that any notice to an Underwriter pursuant to Section 10(d)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its
27.
acceptance telex to the Representatives, which address will be supplied to any
other party hereto by the Representatives upon request. Any such statements,
requests, notices or agreements shall take effect at the time of receipt
thereof. The Company and the Selling Stockholders shall be entitled to act and
rely upon any request, consent, notice or agreement given or made on behalf of
the Underwriters by ▇▇▇▇▇▇ Brothers Inc. on behalf of the Representatives and
the Company and the Underwriters shall be entitled to act and rely upon any
request, consent, notice or agreement given or made on behalf of the Selling
Stockholders by the Custodian.
15. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall inure
to the benefit of and be binding upon the Underwriters, the Company, the Selling
Stockholders and their respective personal representatives, if applicable, and
successors. This Agreement and the terms and provisions hereof are for the sole
benefit of only those persons, except that (A) the representations, warranties,
indemnities and agreements of the Company and the Selling Stockholders contained
in this Agreement shall also be deemed to be for the benefit of the person or
persons, if any, who control any Underwriter within the meaning of Section 15 of
the Securities Act and (B) the indemnity agreement of the Underwriters contained
in Section 10(c) of this Agreement shall be deemed to be for the benefit of
directors of the Company, officers of the Company who have signed the
Registration Statement, any person controlling the Company within the meaning of
Section 15 of the Securities Act and any affiliate of a Selling Stockholder.
Nothing in this Agreement is intended or shall be construed to give any person,
other than the persons referred to in this Section 15, any legal or equitable
right, remedy or claim under or in respect of this Agreement or any provision
contained herein. No purchaser of stock from any Underwriter shall be deemed a
successor of such Underwriter merely by reason of such purchase.
16. SURVIVAL. The respective indemnities, representations, warranties and
agreements of the Company, the Selling Stockholders and the Underwriters
contained in this Agreement or made by or on behalf on them, respectively,
pursuant to this Agreement, shall survive the delivery of and payment for the
Stock and shall remain in full force and effect, regardless of any investigation
made by or on behalf of any of them or any person controlling any of them.
17. DEFINITION OF THE TERMS "BUSINESS DAY" AND "SUBSIDIARY". For purposes
of this Agreement, (a) "business day" means any day on which the New York Stock
Exchange, Inc. is open for trading and (b) "subsidiary" has the meaning set
forth in Rule 405 of the Rules and Regulations.
18. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of New York, without giving effect to the conflict of
law provisions thereof.
19. COUNTERPARTS. This Agreement may be executed by facsimile in one or
more counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
20. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
28.
If the foregoing correctly sets forth the agreement, the Selling
Stockholders and the Underwriters, please indicate your acceptance in the space
provided for that purpose below. Upon such acceptance this letter shall
constitute a binding agreement among each of the Underwriters, the Company and
each of the Selling Stockholders. It is understood that your acceptance of this
letter on behalf of each of the Underwriters is pursuant to the authority set
forth in a form of Agreement Among Underwriters.
Very truly yours,
▇▇▇▇▇ GOLF, INC.
By
-----------------------------------------------
B. H. (BARNEY) ▇▇▇▇▇, CHIEF EXECUTIVE OFFICER
THE SELLING STOCKHOLDERS NAMED IN SCHEDULE 2 TO
THIS AGREEMENT
By
-----------------------------------------------
B.H. (BARNEY) ▇▇▇▇▇, ATTORNEY-IN-FACT
Accepted:
▇▇▇▇▇▇ BROTHERS INC.
NATIONSBANC ▇▇▇▇▇▇▇▇▇▇ SECURITIES LLC
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ INCORPORATED
For themselves and as Representatives
of the several Underwriters named
in Schedule 1 hereto
By ▇▇▇▇▇▇ BROTHERS INC.
By
-----------------------------------------------
AUTHORIZED REPRESENTATIVE
SCHEDULE 1
NUMBER OF SHARES
UNDERWRITERS OF FIRM STOCK
▇▇▇▇▇▇ Brothers Inc. . . . . . . . . . . . . . . . . .
NationsBanc ▇▇▇▇▇▇▇▇▇▇ Securities LLC. . . . . . . . .
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ Incorporated . . . . . . . . . . .
---------------
TOTAL 5,750,000
----------
----------
SCHEDULE 2
NUMBER OF
NUMBER OF SHARES SHARES OF
NAME AND ADDRESS OF SELLING STOCKHOLDER OF FIRM STOCK OPTION STOCK
Royal Holding Company, Inc. 454,745 576,182
c/o ▇▇▇▇ ▇▇▇▇▇
▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇. ▇. ▇▇▇▇▇ 928,000 192,000
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ 388,555 --
The ▇▇▇▇▇▇ Group
▇▇▇ ▇▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇▇ #▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 66,750 16,738
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ --------- ---------
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Lincoln Trust Company, f/b/o ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 77,000 9,592
Custodian FBO ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇'▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 73,750 37,988
▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇.
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ -- 30,000
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ 8,400 --
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 2,800 --
▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ --------- ---------
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
TOTAL 2,000,000 862,500
--------- ---------
--------- ---------