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8,000,000 Shares
SERVICO, INC.
COMMON STOCK
(PAR VALUE $.01 PER SHARE)
U.S. UNDERWRITING AGREEMENT
---------------------------
June __, 1997
▇▇▇▇▇▇ BROTHERS INC.
ALEX. ▇▇▇▇▇ & SONS INCORPORATED
▇▇▇▇▇▇▇▇▇▇ SECURITIES
▇▇▇▇▇▇▇ ▇▇▇▇▇ & ASSOCIATES, INC.
As Representatives of the several
U.S. Underwriters named in Schedule 1,
c/▇ ▇▇▇▇▇▇ Brothers Inc.
Three World ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
Servico, Inc., a Florida corporation (the "Company"),
proposes to sell 8,000,000 shares (the "Firm Stock") of the Company's common
stock, par value $.01 per share (the "Common Stock"). In addition, the Company
proposes to grant to the underwriters named in Schedule 1 hereto (the "U.S.
Underwriters") an option to purchase up to an additional 1,200,000 shares of
the Common Stock on the terms and for the purposes set forth in Section 2 (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 by the U.S. Underwriters
named in Schedule 1 hereto.
It is understood by all parties that the Company is
concurrently entering into an agreement dated the date hereof (the
"International Underwriting Agreement") providing for the sale by the Company
of 2,300,000 shares of Common Stock (including the over-allotment option
thereunder) (the "International Stock") through arrangements with certain
underwriters outside the United States (the "International Managers"), for whom
▇▇▇▇▇▇ Brothers International (Europe), Alex. ▇▇▇▇▇ & Sons Incorporated,
▇▇▇▇▇▇▇▇▇▇ Securities and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc. are acting as lead
managers. The U.S. Underwriters and the International Managers simultaneously
are entering into an agreement between the U.S. and international underwriting
syndicates (the "Agreement Between U.S. Underwriters and International
Managers") which provides for, among other things, the transfer of shares of
Common Stock between the two syndicates. Two forms of prospectus are to be used
in connection with the offering and sale of shares of Common Stock contemplated
by the foregoing, one relating to the Stock and the other relating to the
International Stock. The latter form of
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prospectus will be identical to the former except for certain substitute pages
as included in the registration statement and amendments thereto referred to
below. Except as used in Sections 2, 4, 5, 10, and 11 herein, and except as the
context may otherwise require, references herein to the Stock shall include all
the shares of which may be sold pursuant to either this Agreement or the
International Underwriting Agreement, and references herein to any prospectus
whether in preliminary or final form, and whether as amended or supplemented,
shall include both the U.S. and the international versions thereof.
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY.
The Company represents, warrants and agrees that:
(a) A registration statement on Form S-3 (333-7303),
and any amendments thereto, with respect to the Stock has (i)
been prepared by the Company in conformity with the
requirements of the United States 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 and each amendment thereto 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 with the consent of the Representatives
pursuant to Rule 424(a) of the Rules and Regulations;
"Registration Statement" means such registration statement,
as amended at the Effective Time, including any documents
incorporated by reference therein at such time and 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 "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. Reference made herein to any Preliminary
Prospectus or to the Prospectus shall be deemed to refer to
and include any documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the Securities Act, as
of the date of such Preliminary Prospectus or the Prospectus,
as the case may be, and any reference to any amendment or
supplement to any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include any document filed
under the United States Securities Exchange Act of 1934 (the
"Exchange Act") after the date of such Preliminary Prospectus
or the Prospectus, as the
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case may be, and incorporated by reference in such
Preliminary Prospectus or the Prospectus, as the case may be;
and any reference to any amendment to the Registration
Statement shall be deemed to include any annual report of the
Company filed with the Commission pursuant to Section 13(a)
or 15(d) of the Exchange Act after the Effective Time that is
incorporated by reference in the Registration Statement. The
Commission has not issued any order preventing or suspending
the use of any Preliminary Prospectus.
(b) 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, conform in all respects to the requirements of
the Securities Act and the Rules and Regulations and do not
and will not, as of the applicable effective date (as to the
Registration Statement and any amendment thereto) and as of
the applicable filing date (as to the Prospectus and any
amendment or supplement thereto) contain an untrue statement
of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements
therein not misleading; PROVIDED 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 concerning
such U.S. Underwriter furnished to the Company through the
Representatives by or on behalf of any Underwriter
specifically for inclusion therein.
(c) The documents incorporated by reference in the
Prospectus, when they became effective or were filed with the
Commission, as the case may be, conformed in all material
respects to the requirements of the Securities Act or the
Exchange Act, as applicable, and the rules and regulations of
the Commission thereunder, and none of such documents
contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; and
any further documents so filed and incorporated by reference
in the Prospectus, when such documents become effective or
are filed with Commission, as the case may be, will conform
in all material respects to the requirements of the
Securities Act or the Exchange Act, as applicable, and the
rules and regulations of the Commission thereunder and will
not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or
necessary to make the statements therein not misleading.
(d) The Company and each of its subsidiaries (as
defined in Section 16) have been duly organized and are
validly existing as corporations, [general or] limited
partnerships or limited liability companies, as the case may
be, in good standing under the laws of their respective
jurisdictions of organization, are duly qualified to do
business and are in good standing as foreign corporations,
limited partnerships or limited liability companies, as the
case may be, in each jurisdiction in which their respective
ownership or lease of property or
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the conduct of their respective businesses requires such
qualification, and have all power and authority necessary to
own or hold their respective properties and to conduct the
businesses in which they are engaged.
(e) The Company has an authorized capitalization as
set forth in the Prospectus, and all of the issued shares of
capital stock of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and
conform to the description thereof contained in the
Prospectus; and all of the issued shares of capital stock,
partnership interests or limited liability company membership
interests, as the case may be, of each subsidiary of the
Company have been duly and validly authorized and issued and
(except for partnership interests of general partners) are
fully paid and non-assessable and, except as set forth in
SCHEDULE 1(E), are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities
or claims.
(f) The unissued shares of the Stock to be issued
and sold by the Company to the U.S. Underwriters hereunder
and under the International Underwriting Agreement have been
duly and validly authorized and, when issued and delivered
against payment therefor as provided herein and in the
International Underwriting Agreement, will be duly and
validly issued, fully paid and non-assessable; and the Stock
will conform to the description thereof contained in the
Prospectus.
(g) This Agreement has been duly authorized,
executed and delivered by the Company.
(h) The execution, delivery and performance of this
Agreement and the International Underwriting 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, nor will such actions result in any
violation of the provisions of the charter, by-laws,
partnership agreement or operating agreement of the Company
or any of its subsidiaries or any statute or any order, rule
or regulation 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; 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 U.S.
Underwriters and the International Managers, 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
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performance of this Agreement, or the International
Underwriting Agreement by the Company and the consummation of
the transactions contemplated hereby.
(i) Except as set forth in the Prospectus, here are
no contracts, agreements or understandings between the
Company or any of its subsidiaries and any person granting
such person the right 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. With respect to the Registration
Statement, all of such rights have been waived or satisfied.
(j) Except as set forth in the Prospectus, there are
no preemptive or other rights to subscribe for or to
purchase, nor any restriction upon the voting or transfer of,
any unissued shares of the Stock to be issued and sold by the
Company to the U.S. Underwriters hereunder pursuant to the
Company's charter or by-laws or any agreement or other
instrument.
(k) Except as described in the Prospectus, 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 under,
or Regulations D or S of, 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.
(l) Neither the Company nor any of its subsidiaries
has sustained, since the date of the latest audited financial
statements included or incorporated by reference in the
Prospectus, any material loss or interference with its
business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the
Prospectus; and, since such date, other than as set forth or
contemplated in the Prospectus, (i) there has been no
material adverse change in the financial condition, results
of operation or business of the Company, or any subsidiary of
the Company, whether or not arising in the ordinary course of
business, (ii) no material casualty loss or material
condemnation or other material adverse event with respect to
any Property has occurred, (iii) there have been no
transactions or acquisition agreements entered into by the
Company, or any subsidiary of the Company, other than those
in the ordinary course of business, which are material with
respect to such entity, (iv) there has been no material
adverse change in a dividend or distribution of any kind
declared, paid or made by the Company on any class of its
capital stock and (v) there has been no change in the capital
stock of the Company, or any increase in the indebtedness of
the Company or any subsidiary not in the ordinary course of
business.
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(m) The financial statements (including the related
notes and supporting schedules) filed as part of the
Registration Statement or included or incorporated by
reference in the Prospectus present fairly the 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. The pro forma financial information
included in the Prospectus has been prepared in accordance
with the applicable requirements of Rules 11-01 and 11-02 of
Regulation S-X under the Securities Act and the Rules and
Regulations and AICPA guidelines with respect to pro forma
financial information and includes all adjustments necessary
to present fairly the pro forma financial position of the
Company at the respective dates indicated and the results of
its operations for the respective periods specified. The
assumptions underlying the pro forma adjustments are
reasonable. Other than the historical and pro forma financial
statements included or incorporated by reference therein, no
other financial statements are required by the Securities Act
or the Rules and Regulations to be included in the
Registration Statement.
(n) Ernst & Young LLP, who have certified certain
financial statements of the Company, whose report appears in
the Prospectus or is incorporated by reference therein and
who have delivered the initial letter referred to in Section
8(f) hereof, are independent public accountants as required
by the Securities Act and the Rules and Regulations.
(o) The Company and each of its subsidiaries have
good and marketable title in fee simple to all real property
and good and marketable title to all personal property owned
by them, in each case free and clear of all liens,
encumbrances and defects except such as are described in the
Prospectus or such as do not materially affect the value of
such property and do not 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, subsisting and enforceable leases, with
such exceptions as are not material and do not interfere with
the use made and proposed to be made of such property and
buildings by the Company and its subsidiaries. There is
issued and outstanding with respect to each of the wholly
owned or partially owned hotels ("Owned Hotels") an ALTA form
of owner's title insurance policy (or local equivalent with
respect to those Owned Hotels located in jurisdictions where
an ALTA form of owner's title insurance policy is not
available) insuring the fee simple or leasehold estate of the
applicable subsidiary of the Company in the Owned Hotel owned
by such subsidiary in an amount at least equal to the
acquisition price of such Owned Hotel and each such title
insurance policy is in full force and effect.
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(p) The Company and each of its subsidiaries carry,
or are covered by, insurance in such amounts and covering
such risks as is adequate for the conduct of their respective
businesses and the value of their respective properties and
as is customary for companies engaged in similar businesses
in similar industries.
(q) Each of the Company and its subsidiaries
possesses such certificates, authorizations or permits issued
by the appropriate state, federal or foreign regulatory
agencies or bodies necessary to conduct the business now
operated by them, except where the failure to possess such
certificates, authorizations or permits 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 (a
"Material Adverse Effect"), and none of the Company or any of
its subsidiaries has received any notice of proceedings
relating to the revocation or modification of any such
certificate, authorization or permit which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling,
or finding, would have a Material Adverse Effect.
(r) 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 and franchises 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. Any prior notice
received by the Company or any subsidiary from any franchisor
terminating, or threatening to terminate, the current
franchise agreement for any Owned Hotel has been cured, is no
longer effective, or has been waived by the party issuing
such notice.
(s) 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, could
reasonably be expected to have a Material Adverse Effect; and
to the best of the Company's knowledge, no such proceedings
are threatened or contemplated by governmental authorities or
threatened by others.
(t) The Company and the Offering meet the conditions
for use of Form S-3, as set forth in the General Instructions
thereto.
(u) There are no contracts or other documents which
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 which 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.
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(v) No relationship, direct or indirect, exists
between or among the Company or any of its subsidiaries on
the one hand, and the directors, officers, stockholders,
customers or suppliers of the Company or any of its
subsidiaries on the other hand, which is required to be
described in the Prospectus which is not so described.
(w) There is (i) no material unfair labor practice
complaint pending against the Company or its subsidiaries
nor, to the best knowledge of the Company, threatened against
any of them before the National Labor Relations Board or any
state or local labor relations board, and no significant
grievance or significant arbitration proceeding arising out
of or under any collective bargaining agreement is so pending
against the Company or its subsidiaries or, to the best
knowledge of the Company, threatened against any of them,
(ii) no material strike, labor dispute, slowdown or stoppage
pending against the Company or its subsidiaries nor, to the
best knowledge of the Company, threatened against the Company
or its subsidiaries which could reasonably be expected to
have a Material Adverse Effect.
(x) None of the Company or any subsidiary has
violated any safety or similar law applicable to its business
nor any federal, state or local law relating to
discrimination in the hiring, promotion or pay of employees
nor any applicable federal or state wages and hours laws
which in each case could reasonably be expected to result in
a Material Adverse Effect.
(y) The Company and its subsidiaries are in
compliance in all material respects with all presently
applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations
and published interpretations thereunder ("ERISA"); no
"reportable event" (as defined in ERISA) has occurred with
respect to any "pension plan" (as defined in ERISA) for which
the Company would have any liability; the Company or its
subsidiaries have not incurred and do not expect to incur
liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any "pension plan" or
(ii) Sections 412 or 4971 of the Internal Revenue Code of
1986, as amended, including the regulations and published
interpretations thereunder (the "Code"); and each "pension
plan" for which the Company or its subsidiaries would have
any liability that is intended to be qualified under Section
401(a) of the Code is so qualified in all material respects
and nothing has occurred, whether by action or by failure to
act, which would cause the loss of such qualification.
(z) The Company and each of 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
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subsidiaries which has had (nor does the Company or its
subsidiaries have any knowledge of) any tax deficiency which,
if determined adversely to the Company or any of its
subsidiaries, could reasonably be expected to have a Material
Adverse Effect; the amounts currently set up as provisions
for taxes or otherwise by the Company and its subsidiaries on
their books and records are sufficient for the payment of all
their unpaid federal, foreign, state, county and local taxes
accrued through the dates as of which they speak, and for
which the Company and its subsidiaries may be liable in their
own right or as a transferee of the assets of, or as
successor to any other corporation, association, partnership,
limited liability company, joint venture or other entity.
(aa) 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 and its
subsidiaries have not (i) 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, issued or granted any
securities, (ii) incurred any liability or obligation, direct
or contingent, other than liabilities and obligations which
were incurred in the ordinary course of business, (iii)
entered into any transaction not in the ordinary course of
business or (iv) declared or paid any dividend on its capital
stock.
(ab) The Company and its subsidiaries (i) make and
keep accurate books and records and (ii) maintain internal
accounting controls which 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
books, records and accounts 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.
(ac) Neither the Company nor any of its subsidiaries
(i) is in violation of its charter, by-laws, partnership
agreement or operating agreement, (ii) is in default in any
material respect, and no event has occurred which, with
notice or lapse of time or both, would constitute such a
default, in the due performance or observance of any term,
covenant or condition contained in any material indenture,
mortgage, deed of trust, loan agreement, franchise agreement,
management 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 or (iii) is in
violation in any respect of any law, ordinance, governmental
rule, regulation or court decree 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 which violation or
failure could reasonably be expected to have a Material
Adverse Effect.
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(ad) Neither the Company nor any of its
subsidiaries, nor 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,
partnership or company 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, partnership or company funds;
violated or is in violation of any provision of the Foreign
Corrupt Practices Act of 1977; or made any bribe, rebate,
payoff, influence payment, kickback or other unlawful
payment.
(ae) There has been no storage, disposal,
generation, manufacture, refinement, installation,
transportation, handling or treatment of toxic wastes,
medical wastes, hazardous wastes, petroleum or petroleum
products (including crude oil or any fraction thereof),
hazardous substances or any other substances which pose a
hazard to human health, safety, natural resources, industrial
hygiene or the environment or which cause or threaten to
cause a nuisance by the Company, any of its subsidiaries,
(or, to the knowledge of the Company, by any of their
predecessors in interest or by any other entity) at, upon or
from any of the property now or previously owned leased or,
to the knowledge of Company, operated by the Company or its
subsidiaries except to the extent commonly used in the normal
operations of such property, in violation of any applicable
law, ordinance, rule, regulation, order, judgment, decree or
permit or which would require investigation, monitoring,
removal action, corrective action, remedial action or other
response action ("response action") under any applicable law,
ordinance, rule, regulation, order, judgment, decree or
permit, except for any violation or response action which
would not have, or could not be reasonably likely to have,
singularly or in the aggregate with all such violations and
response actions, a Material Adverse Effect; there has been
no material spill, discharge, leak, emission, injection,
escape, dumping or release or threatened release of any kind
onto such property or into the environment surrounding such
property of any toxic wastes, medical wastes, solid wastes,
hazardous wastes, petroleum or petroleum products (including
crude oil or any fraction thereof), hazardous substances or
any other substances which pose a hazard to human health,
safety, natural resources, industrial hygiene or the
environment or which cause or threaten to cause a nuisance,
except for any such spill, discharge, leak, emission,
injection, escape, dumping or release or threatened release
which would not have or would not be reasonably likely to
have, singularly or in the aggregate with all such spills,
discharges, leaks, emissions, injections, escapes, dumpings,
releases and threatened releases, a Material Adverse Effect;
and the terms "hazardous wastes," "solid wastes," "toxic
wastes," "hazardous substances," "petroleum," "petroleum
products" and "medical wastes" shall have the meanings
specified in any applicable local, state, federal and foreign
laws or regulations with respect to environmental protection.
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(af) Neither the Company nor any subsidiary is, or
will be as a result of the offer and sale of the Stock
hereunder, an "investment company" within the meaning of such
term under the Investment Company Act of 1940 and the rules
and regulations of the Commission thereunder.
2. PURCHASE OF THE STOCK BY THE U.S. 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 8,000,000
shares of the Firm Stock to the several Underwriters and each of the U.S.
Underwriters, severally and not jointly, agrees to purchase the number of
shares of the Firm Stock set opposite that U.S. Underwriter's name in Schedule
1 hereto. The respective purchase obligations of the U.S. Underwriters with
respect to the Firm Stock shall be rounded among the U.S. Underwriters to avoid
fractional shares, as the Representatives may determine.
In addition, the Company grants to the U.S. Underwriters an
option to purchase up to 1,200,000 shares of Option Stock. Such option is
granted solely for the purpose of covering over-allotments in the sale of Firm
Stock and is exercisable as provided in Section 4 hereof. Shares of Option
Stock shall be purchased severally for the account of the U.S. Underwriters in
proportion to the number of shares of Firm Stock set opposite the name of such
U.S. Underwriters in Schedule 1 hereto. The respective purchase obligations of
each U.S. Underwriter with respect to the Option Stock shall be adjusted by the
Representatives so that no U.S. Underwriter shall be obligated to purchase
Option Stock other than in 100 share amounts. The price of both the Firm Stock
and any Option Stock shall be $_____ per share.
The Company shall not be obligated to deliver any of the
Stock to be delivered on the First Delivery Date or the Second Delivery Date
(as hereinafter defined), as the case may be, except upon payment for all the
Stock to be purchased on such Delivery Date as provided herein and in the
International Underwriting Agreement.
3. RETENTION OF QUALIFIED INDEPENDENT UNDERWRITER. The
Company hereby confirms its engagement of Alex. ▇▇▇▇▇ & Sons Incorporated as,
and Alex. ▇▇▇▇▇ & Sons Incorporated hereby confirms its agreement with the
Company to render services as, "qualified independent underwriter" within the
meaning of Section 2720 of the Conduct Rules of the National Association of
Securities Dealers, Inc. with respect to the offering and sale of the Stock.
Alex. ▇▇▇▇▇ & Sons Incorporated, solely in its capacity as qualified
independent underwriter and not otherwise, is referred to herein as the
"Independent Underwriter."
4. OFFERING OF STOCK BY THE UNDERWRITERS. Upon authorization
by the Representatives of the release of the Firm Stock, the several U.S.
Underwriters propose to offer the Firm Stock for sale upon the terms and
conditions set forth in the Prospectus. Each U.S. Underwriter agrees that,
except to the extent permitted by the Agreement Between U.S. Underwriters and
International Managers, it will not offer or sell any of the Stock outside of
the United States.
5. DELIVERY OF AND PAYMENT FOR THE STOCK. Delivery of and
payment for the Firm Stock shall be made at the office of ▇▇▇▇▇▇ Brothers Inc.
at 10:00 A.M., New York City
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time, on the fourth full business day following the date of this Agreement or
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 shall
deliver or cause to be delivered certificates representing the Firm Stock to
the Representatives for the account of each U.S. Underwriter against payment to
or upon the order of the Company of the purchase price by wire transfer of
federal (same day) funds to an account or accounts designated in writing to
▇▇▇▇▇▇ Brothers Inc. by the Company. 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 U.S. 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
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.
At any time, and from time to time, on or before the
thirtieth day after the date of this Agreement the option granted in Section 2
may be exercised by written notice being given to the Company 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 second 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 Company) at 10:00 A.M., New York City time, on the
Second Delivery Date. On the Second Delivery Date, the Company shall deliver or
cause to be delivered the certificates representing the Option Stock to the
Representatives for the account of each U.S. Underwriter against payment to or
upon the order of the Company of the purchase price by wire transfer of federal
(same day) funds to an account or accounts designated in writing to ▇▇▇▇▇▇
Brothers Inc. by the Company. 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 U.S. 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 Company 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.
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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
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 prior to the last Delivery Date 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 file promptly all
reports and any definitive proxy or information statements
required to be filed by the Company with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange
Act subsequent to the date of the Prospectus and for so long
as the delivery of a prospectus is required in connection
with the offering or sale of the Stock; 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 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 U.S. Underwriters a
signed 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), (ii) each Preliminary Prospectus, the
Prospectus and any amended or supplemented Prospectus and
(iii) any document incorporated by reference in the
Prospectus (excluding exhibits thereto); 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
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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 or to file under the
Exchange Act any document incorporated by reference in the
Prospectus in order to comply with the Securities Act or the
Exchange Act, to notify the Representatives and, upon their
request, to file such document and to prepare and furnish
without charge to each U.S. 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 which will correct such statement or omission or
effect such compliance.
(d) During the period when the Prospectus is
required to be delivered in connection with the offer and
sale of the Stock, 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;
(e) Prior to filing with the Commission any
amendment to the Registration Statement or supplement to the
Prospectus, any document incorporated by reference in 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 U.S. Underwriters and
obtain the consent of the Representatives to the filing,
except that with respect to current reports on Form 8-K, the
Company shall use its best efforts to satisfy this covenant;
(f) As soon as practicable after the Effective Date
(it being understood that the Company shall have until at
least 410 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);
(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 shareholders
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;
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(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 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, offer for sale,
sell or otherwise dispose of (or enter into any transaction
or device which is designed to, or could be expected to,
result in the disposition by any person at any time in the
future of) any shares of Common Stock (other than the Stock
and shares issued pursuant to employee benefit plans,
qualified stock option plans or other employee compensation
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 (other than the grant of options pursuant to
option plans existing on the date hereof), without the prior
written consent of ▇▇▇▇▇▇ Brothers Inc.;
(j) Prior to the Effective Date, to apply for the
listing of the Stock on the New York Stock Exchange and to
use its best efforts to complete that listing, subject only
to official notice of issuance, prior to the First Delivery
Date;
(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 take such steps as shall be necessary to
ensure that neither the Company nor any subsidiary shall
become an "investment company" within the meaning of such
term under the Investment Company Act of 1940 and the rules
and regulations of the Commission thereunder.
7. 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 or
any document incorporated by reference therein, 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 filing fees and expenses (including related
reasonable fees and expenses of counsel to the Underwriters) incident to
securing any required review by the National Association of Securities Dealers,
Inc. of the terms of sale of the Stock; (f) any applicable listing or other
fees; (g) the fees and expenses of qualifying the Stock under the
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securities laws of the several jurisdictions as provided in Section 6(h) and
of preparing, printing and distributing a Blue Sky Memorandum (including
related reasonable fees and expenses of counsel to the Underwriters); (i) all
fees and expenses of an Independent Underwriter; and (j) all other costs and
expenses incident to the performance of the obligations of the Company under
this Agreement; PROVIDED that, except as provided in this Section 7 and in
Section 12, the U.S. 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 and the expenses of advertising any offering of the
Stock made by the U.S. Underwriters.
8. CONDITIONS OF U.S. UNDERWRITERS' OBLIGATIONS. The
respective obligations of the U.S. Underwriters hereunder are subject to the
accuracy, when made and on each Delivery Date, of the representations and
warranties of the Company contained herein, to the performance by the Company
of its obligations hereunder required to be performed at or prior to the
Delivery Date, 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 U.S. Underwriter or International Manager
shall have discovered and disclosed to the Company on or
prior to such Delivery Date that the Registration Statement
or the Prospectus or any amendment or supplement thereto
contains an untrue statement of a fact which, in the opinion
of ▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P., counsel for the U.S. 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.
(c) All corporate proceedings and other legal
matters incident to the authorization, form and validity of
this Agreement, the International Underwriting Agreement, 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 U.S.
Underwriters, and the Company shall have furnished to such
counsel all documents and information that they may
reasonably request to enable them to pass upon such matters.
(d) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇▇, P.A. shall have furnished to the Representatives
its written opinion, as counsel to the Company, addressed to
the U.S. Underwriters and dated such Delivery Date, in form
and substance reasonably satisfactory to the Representatives,
to the effect that:
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(i) The Company and each of its
subsidiaries have been duly incorporated or formed
and are validly existing as corporations, [general
or] limited partnerships or limited liability
companies, as the case may be, in good standing
under the laws of their respective jurisdictions of
organization, are duly qualified to do business and
are in good standing as foreign corporations,
limited partnerships or limited liability companies,
as the case may be, in each jurisdiction in which
their respective ownership or lease of property or
the conduct of their respective businesses (as set
forth in certificates of officers of the Company,
upon which such counsel is relying without
independent investigation) requires such
qualification and except where the failure to so
qualify or be in good standing would not have a
Material Adverse Effect and have all corporate or
partnership power and authority necessary to own or
hold their respective properties and conduct the
businesses in which they are engaged;
(ii) The Company has an authorized
capitalization as set forth in the Prospectus, and
all of the issued shares of capital stock of the
Company (including the shares of Stock being
delivered on such Delivery Date) have been duly and
validly authorized and issued, are fully paid and
non-assessable and conform to the description
thereof contained in the Prospectus; and all of the
issued shares of capital stock, partnership
interests or limited liability company membership
interests, as the case may be, of each subsidiary of
the Company have been duly and validly authorized
and issued and (except for partnership interests of
general partners) are fully paid, non-assessable and
are owned directly or indirectly by the Company, to
such counsel's knowledge free and clear of all
liens, encumbrances, equities or claims, except as
set forth in Schedule 1(e);
(iii) There are no statutory preemptive or,
to such counsel's knowledge, other rights to
subscribe for or to purchase, nor any restriction
upon the voting or transfer of, any shares of the
Stock pursuant to the Company's charter or by-laws
or any agreement or other instrument known to such
counsel;
(iv) To the best of such counsel's
knowledge and other than as set forth in the
Prospectus, 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 could reasonably
be expected to have a Material Adverse Effect; and,
to the best of such counsel's knowledge, no such
proceedings are threatened or contemplated by
governmental authorities or threatened by others;
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(v) The Registration Statement was declared
effective under the Securities Act as of the date
and time specified in such opinion, the Prospectus
was filed with the Commission pursuant to the
subparagraph of Rule 424(b) of the Rules and
Regulations specified in such opinion on the date
specified therein and to the knowledge of such
counsel, no stop order suspending the effectiveness
of the Registration Statement has been issued and no
proceeding for that purpose is pending or threatened
by the Commission;
(vi) The Registration Statement and the
Prospectus and any further amendments or supplements
thereto made by the Company prior to such Delivery
Date (other than the financial statements and
related schedules therein, as to which such counsel
need express no opinion) comply as to form in all
material respects with the requirements of the
Securities Act and the Rules and Regulations; the
documents incorporated by reference in the
Prospectus and any further amendment or supplement
to any such incorporated document made by the
Company prior to such Delivery Date (other than the
financial statements and related schedules therein,
as to which such counsel need express no opinion),
when they became effective or were filed with the
Commission, as the case may be, complied as to form
in all material respects with the requirements of
the Securities Act or the Exchange Act, as
applicable, and the rules and regulations of the
Commission thereunder;
(vii) To the best of such counsel's
knowledge, there are no contracts or other documents
which 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 which have not been described or filed
as exhibits to the Registration Statement or
incorporated therein by reference as permitted by
the Rules and Regulations;
(viii) Each of this Agreement and the
International Underwriting Agreement has been duly
authorized, executed and delivered by the Company;
(ix) The issue and sale of the shares of
Stock being delivered on such Delivery Date by the
Company and the compliance by the Company with all
of the provisions of this Agreement and the
International Underwriting Agreement 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, franchise agreement,
management agreement or other agreement or
instrument known to such counsel to which the
Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries is
bound or to
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which any of the property or assets of the Company
or any of its subsidiaries is subject, which breach
is reasonably likely to have a Material Adverse
Effect nor will such actions result in any violation
of the provisions of the charter, by-laws or limited
partnership agreement of the Company or any of its
subsidiaries or any statute or any order, rule or
regulation known to such counsel of any court or
governmental agency or body of the United States or
the State of Florida having jurisdiction over the
Company or any of its subsidiaries or any of their
properties or assets; 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 or
foreign securities laws in connection with the
purchase and distribution of the Stock by the U.S.
Underwriters and the International Managers, 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 or the International Underwriting
Agreement by the Company and the consummation of the
transactions contemplated hereby;
(x) To the best of such counsel's
knowledge, except as set forth in the Prospectus,
there are no contracts, agreements or understandings
between the Company and any person granting such
person the right 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. With respect to the Registration
Statement, all of such rights have been waived or
satisfied;
(xi) Neither the Company nor any of its
subsidiaries is an "investment company" as such term
is defined in the Investment Company Act of 1940, as
amended; and
(xii) The statements contained in the
Prospectus under the caption "Certain United States
Federal Tax Considerations to Non-U.S. Holders,
regarding federal income tax treatment are correct
in all material respects.
In rendering such opinion, such counsel may state that its
opinion is limited to matters governed by the Federal laws of
the United States of America, and the laws of the State of
Florida. Such counsel shall also have furnished to the
Representatives a written statement, addressed to the U.S.
Underwriters and dated such Delivery Date, in form and
substance satisfactory to the Representatives, to
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the effect that (x) such counsel has acted as counsel to the
Company on a regular basis, has acted as counsel to the
Company in connection with previous financing transactions
and has acted as counsel to the Company in connection with
the preparation of the Registration Statement, and (y) based
on the foregoing, no facts have come to the attention of such
counsel which lead it to believe that (I) the Registration
Statement (except for financial statements and schedules
included therein or omitted therefrom, as to which counsel
need make no 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
the Prospectus (except for financial statements and schedules
included therein or omitted therefrom, as to which counsel
need make no statement) 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 or (II) any document
incorporated by reference in the Prospectus or any further
amendment or supplement to any such incorporated document
made by the Company prior to such Delivery Date (except for
financial statements and schedules included therein or
omitted therefrom, as to which counsel need make no
statement), when they became effective or were filed with the
Commission, as the case may be, contained, in the case of a
registration statement which became effective under the
Securities Act, 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, in the case of other documents which were
filed under the Exchange Act with the Commission, an untrue
statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not
misleading.
(e) The Representatives shall have received from
▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P., counsel for the U.S. 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.
(f) At the time of execution of this Agreement, the
Representatives shall have received from Ernst & Young LLP a
letter, in form and substance satisfactory to the
Representatives, addressed to the U.S. Underwriters and dated
the date hereof (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, (ii) stating, as of the
date hereof (or, with respect to matters involving changes or
developments since the respective dates as of which specified
financial information is given in the Prospectus, as of a
date
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not more than five days prior to the date hereof), the
conclusions and findings of such firm with respect to the
financial information and other matters ordinarily covered by
accountants' "comfort letters" to underwriters in connection
with registered public offerings.
(g) With respect to the letter of Ernst & Young LLP
referred to in the preceding paragraph and delivered to the
Representatives concurrently with the execution of this
Agreement (the "initial letter"), the Company shall have
furnished to the Representatives a letter (the "bring-down
letter") of such accountants, addressed to the U.S.
Underwriters and dated such Delivery Date (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, (ii)
stating, as of the date of the bring-down letter (or, with
respect to matters involving changes or developments since
the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more
than five days prior to the date of the bring-down letter),
the conclusions and findings of such firm with respect to the
financial information and other matters covered by the
initial letter and (iii) confirming in all material respects
the conclusions and findings set forth in the initial letter.
(h) The Company shall have furnished to the
Representatives a certificate, dated such Delivery Date, of
its Chairman of the Board, its President or a Vice President
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 8(a) and
8(i) have been fulfilled; and
(ii) They have carefully examined the
Registration Statement and the Prospectus and, in
their opinion (A) as of the Effective Date, the
Registration Statement and Prospectus did not
include any untrue statement of a material fact and
did not omit to state a material fact required to be
stated therein or necessary to make the statements
therein not misleading, and (B) since the Effective
Date no event has occurred which is material to the
consolidated financial position, stockholder's
equity, results of operations, business or prospects
of the Company and its subsidiaries.
(i) (I) Neither the Company nor any of its
subsidiaries shall have sustained since the date of the
latest audited financial statements included or incorporated
by reference in the Prospectus any loss or interference with
its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or
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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
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.
(j) 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, the Nasdaq Stock
Market or in the over-the-counter market, or trading in any
securities of the Company on any 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.
(k) The New York Stock Exchange shall have approved
the Stock for listing, subject only to official notice of
issuance.
(l) The closing under the International Underwriting
Agreement shall have occurred concurrently with the closing
hereunder on the First Delivery Date.
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.
9. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company shall indemnify and hold harmless
each U.S. Underwriter (including any U.S. Underwriter in its
role as qualified independent underwriter pursuant to the
rules of the National Association of Securities
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Dealers, Inc.), its officers and employees and each person,
if any, who controls any U.S. 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 U.S. 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 (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 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"), (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, or (iii) any act or failure to act or any
alleged act or failure to act by any U.S. 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) or (ii) above (PROVIDED that the Company shall not
be liable under this clause (iii) 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 U.S.
Underwriter through its gross negligence or willful
misconduct), and shall reimburse each U.S. Underwriter and
each such officer, employee or controlling person promptly
upon demand for any legal or other expenses reasonably
incurred by that U.S. 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 concerning such U.S. Underwriter furnished to the
Company through the Representatives by or on behalf of any
U.S. Underwriter specifically for inclusion therein. The
foregoing indemnity agreement is in addition to any liability
which the Company may otherwise have to any U.S. Underwriter
or to any officer, employee or controlling person of that
U.S. Underwriter.
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(b) Each U.S. Underwriter, severally and not
jointly, shall indemnify and hold harmless the Company, its
officers and employees, each of its directors, and each
person, if any, who controls the Company 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, 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 concerning such U.S. Underwriter
furnished to the Company through the Representatives by or on
behalf of that U.S. 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 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 which any U.S. Underwriter may
otherwise have to the Company or any such director, officer,
employee or controlling person.
(c) Promptly after receipt by an indemnified party
under this Section 9 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 9, 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 which it may have under this Section 9
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 which it may have to an indemnified party otherwise
than under this Section 9. 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 9 for any legal or other
expenses subsequently incurred by the indemnified party in
connection with the defense
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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 U.S. Underwriters and their
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 U.S.
Underwriters against the Company under this Section 9 if, in
the reasonable judgment of the Representatives, it is
advisable for the Representatives and those U.S.
Underwriters, officers, employees and controlling persons to
be jointly represented by separate counsel, and in that event
the fees and expenses of one such separate counsel in each
state shall be paid by the Company; provided further, that,
if indemnity is sought by the Independent Underwriter acting
in its capacity as the "qualified independent underwriter,"
then, in addition to such counsel for the indemnified
parties, the indemnifying party shall be liable for the
reasonable fees and expenses of not more than one counsel (in
addition to any necessary local counsel) for such Independent
Underwriter and all persons, if any, who control the
Independent Underwriter within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act, if, in
the reasonable judgment of the Independent Underwriter there
may exist a conflict of interest between the Independent
Underwriter and the other indemnified parties. In the case of
any such separate counsel for the Independent Underwriter and
such control persons of the Independent Underwriter, such
counsel shall be designated in writing by the Independent
Underwriter. 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
indemnified party from and against any loss or liability by
reason of such settlement or judgment.
(d) If the indemnification provided for in this
Section 9 shall for any reason be unavailable to or
insufficient to hold harmless an indemnified party under
Section 9(a) or 9(b) 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 on the
one hand and the U.S. Underwriters on the other from the
offering of the Stock or (ii) if the
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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 on the
one hand and the U.S. Underwriters on the other with respect
to the statements or omissions which 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 on the one hand and
the U.S. Underwriters on the other 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, on the one hand, and the total underwriting
discounts and commissions received by the U.S. 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 or the U.S. 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 and the U.S. Underwriters
agree that it would not be just and equitable if
contributions pursuant to this Section were to be determined
by pro rata allocation (even if the U.S. Underwriters were
treated as one entity for such purpose) or by any other
method of allocation which 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 shall be deemed to include,
for purposes of this Section 9(d), 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 9(d),
no U.S. 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 which such U.S. 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 U.S. Underwriters'
obligations to contribute as provided in this Section 9(d)
are several in proportion to their respective underwriting
obligations and not joint.
(e) The U.S. Underwriters severally confirm and the
Company acknowledges that the statements with respect to the
public offering of the Stock by the U.S. Underwriters set
forth on the cover page of, the legend concerning
stabilization on the inside front cover page of and the
concession and reallowance figures appearing under the
caption "Underwriting" in, the Prospectus are correct
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and constitute the only information concerning such U.S.
Underwriters furnished in writing to the Company by or on
behalf of the U.S. Underwriters specifically for inclusion in
the Registration Statement and the Prospectus.
10. DEFAULTING U.S. UNDERWRITERS. If, on either Delivery
Date, any U.S. Underwriter defaults in the performance of its obligations under
this Agreement, the remaining non-defaulting U.S. Underwriters shall be
obligated to purchase the Stock which the defaulting U.S. Underwriter agreed
but failed to purchase on such Delivery Date in the respective proportions
which the number of shares of the Firm Stock set opposite the name of each
remaining non-defaulting U.S. 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 U.S. Underwriters in Schedule 1 hereto; PROVIDED,
HOWEVER, that the remaining non-defaulting U.S. 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 U.S. Underwriter or U.S.
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 U.S. 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 2. If the
foregoing maximums are exceeded, the remaining non-defaulting U.S.
Underwriters, or those other U.S. 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 U.S. Underwriters or
other U.S. Underwriters satisfactory to the Representatives do not elect to
purchase the shares which the defaulting U.S. Underwriter or U.S. Underwriters
agreed but failed to purchase on such Delivery Date, this Agreement (or, with
respect to the Second Delivery Date, the obligation of the U.S. Underwriters to
purchase, and of the Company to sell, the Option Stock) shall terminate without
liability on the part of any non-defaulting U.S. Underwriter or the Company,
except that the Company will continue to be liable for the payment of expenses
to the extent set forth in Sections 7 and 12. As used in this Agreement, the
term "U.S. 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 10, purchases Firm Stock which a defaulting U.S.
Underwriter agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting U.S.
Underwriter of any liability it may have to the Company for damages caused by
its default. If other U.S. Underwriters are obligated or agree to purchase the
Stock of a defaulting or withdrawing U.S. 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 U.S. Underwriters may be necessary
in the Registration Statement, the Prospectus or in any other document or
arrangement.
11. TERMINATION. The obligations of the U.S. Underwriters
hereunder may be terminated by the Representatives by notice given to and
received by the Company prior to delivery of and payment for the Firm Stock if,
prior to that time, any of the events described in
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Sections 8(i) or 8(j), shall have occurred or if the U.S. Underwriters shall
decline to purchase the Stock for any reason permitted under this Agreement.
12. REIMBURSEMENT OF U.S. UNDERWRITERS' EXPENSES. If (a) the
Company shall fail to tender the Stock for delivery to the U.S. Underwriters by
reason of any failure, refusal or inability on the part of the Company to
perform any agreement on its part to be performed, or because any other
condition of the U.S. Underwriters' obligations hereunder required to be
fulfilled by the Company is not fulfilled, the Company will reimburse the U.S.
Underwriters for all reasonable out-of-pocket expenses (including fees and
disbursements of counsel) incurred by the U.S. Underwriters in connection with
this Agreement and the proposed purchase of the Stock, and upon demand the
Company shall pay the full amount thereof to the Representatives. If this
Agreement is terminated pursuant to Section 10 by reason of the default of one
or more U.S. Underwriters, the Company shall not be obligated to reimburse any
defaulting U.S. Underwriter on account of those expenses.
13. NOTICES, ETC. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the U.S. 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:
212-526-6588), with a copy, in the case of any notice
pursuant to Section 8(c), 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: (▇▇▇) ▇▇▇-▇▇▇▇);
PROVIDED, HOWEVER, that any notice to a U.S. Underwriter pursuant to Section
9(c) shall be delivered or sent by mail, telex or facsimile transmission to
such U.S. Underwriter at its address set forth in its 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 shall
be entitled to act and rely upon any request, consent, notice or agreement
given or made on behalf of the U.S. Underwriters by ▇▇▇▇▇▇ Brothers Inc. on
behalf of the Representatives.
14. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement
shall inure to the benefit of and be binding upon the U.S. Underwriters, the
Company, and their respective 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
contained in this Agreement shall also be deemed to be for the benefit of the
person or persons, if any, who control any U.S. Underwriter within the meaning
of Section 15 of the Securities Act and for the benefit of each International
Manager (and controlling persons thereof) who offers or sells any shares of
Stock in accordance with the terms of the Agreement Between U.S. Underwriters
and International Managers and (B) the indemnity agreement of the U.S.
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Underwriters contained in Section 9(b) 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 and any person controlling the Company within
the meaning of Section 15 of the Securities Act. Nothing in this Agreement is
intended or shall be construed to give any person, other than the persons
referred to in this Section 14, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision contained herein.
15. SURVIVAL. The respective indemnities, representations,
warranties and agreements of the Company and the U.S. 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.
16. 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 is open for trading and (b) "subsidiary" has the
meaning set forth in Rule 405 of the Rules and Regulations.
17. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF NEW YORK WITHOUT PRINCIPLES OF
CONFLICT OF LAW THEREOF.
18. COUNTERPARTS. This Agreement may be executed 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.
19. 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.
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If the foregoing correctly sets forth the agreement between
the Company and the U.S. Underwriters, please indicate your acceptance in the
space provided for that purpose below.
Very truly yours,
SERVICO, INC.
By ____________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Chief Executive Officer
Accepted:
▇▇▇▇▇▇ BROTHERS INC.
ALEX. ▇▇▇▇▇ & SONS INCORPORATED
▇▇▇▇▇▇▇▇▇▇ SECURITIES
▇▇▇▇▇▇▇ ▇▇▇▇▇ & ASSOCIATES, INC.
For themselves and as Representatives
of the several U.S. Underwriters named
in Schedule 1 hereto
By ▇▇▇▇▇▇ BROTHERS INC.
By ________________________________
AUTHORIZED REPRESENTATIVE
ALEX. ▇▇▇▇▇ & SONS INCORPORATED
as Independent Underwriter
By _________________________________
AUTHORIZED REPRESENTATIVE
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SCHEDULE 1
Number of
Shares
---------
U.S. Underwriters
-----------------
▇▇▇▇▇▇ Brothers Inc.......................................
Alex. ▇▇▇▇▇ & Sons Incorporated...........................
▇▇▇▇▇▇▇▇▇▇ Securities.....................................
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc...........................
Total................................................ 8,000,000
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