EXHIBIT 1
▇.▇.▇. TRANSPORTATION SERVICES, INC.
3,475,000 SHARES*
Common Stock
($0.01 par value)
UNDERWRITING AGREEMENT
___________, 2002
▇▇▇▇▇▇▇▇ INC., BB&T CAPITAL MARKETS
and ▇. ▇. ▇▇▇▇▇▇▇ & SONS, INC.
As Representatives of the several
Underwriters named in Schedule II hereto.
c/o Stephens Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Gentlemen:
▇.▇.▇. Transportation Services, Inc., a Delaware corporation (the
"Company"), and the individuals whose names appear on Schedule I hereto,
designated as selling stockholders (collectively, the "Selling Stockholders"),
severally and not jointly, confirm their agreement with the several underwriters
(the "Underwriters") for whom you are acting as representatives (the
"Representatives") as follows:
The Company proposes to issue and sell 2,100,000 shares of its
authorized and unissued shares of common stock, par value $0.01 per share, to
the several Underwriters (the "Company Shares"), and the Selling Stockholders,
acting severally and not jointly, propose to sell an aggregate of 1,375,000
shares of the authorized and outstanding shares of the Company's common stock,
par value $0.01 per share, to the several Underwriters (the "Selling
Stockholders Shares"). The Company Shares and the Selling Stockholders Shares
are hereinafter collectively referred to as the "Underwritten Shares." The
Company and the Selling Stockholders are sometimes referred to collectively
herein as "Sellers." The respective amounts of Underwritten Shares to be
initially sold by each of the Sellers is set forth on Schedule I attached
hereto. The Company's common stock is more fully described in the Registration
Statement and the Prospectus hereinafter mentioned.
For the sole purpose of covering over-allotments in connection with the
sale of the Underwritten Shares, the Company shall grant to the Underwriters the
option (the "Option") described in Section 2 hereof to purchase all or any part
of an additional 521,250 shares of the Company's common stock (the "Option
Shares"). The Underwritten Shares and the Option Shares purchased pursuant to
this Underwriting
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*Plus up to 521,250 additional shares of common stock to cover over-allotments.
Agreement (this "Agreement") are herein called the "Shares" and the proposed
offering of the Shares by the Underwriters is hereinafter referred to as the
"Public Offering."
The Company has filed with the Securities and Exchange Commission (the
"Commission"), pursuant to the Securities Act of 1933, as amended (the "Act"),
and published rules and regulations adopted by the Commission under the Act (the
"Rules"), a registration statement on Form S-2 ("Form S-2") (File No.
333-83084), including a Preliminary Prospectus, relating to the Shares, and such
amendments to such registration statement as may have been filed with the
Commission to the date of this Agreement. The Company will also file with the
Commission one of the following: (A) prior to effectiveness of such registration
statement, a further amendment to such registration statement, including the
form of final prospectus, and/or (B) after effectiveness of such registration
statement, a final prospectus in accordance with Rules 430A and 424(b). The
Company has furnished to the Representatives copies of such registration
statement, each amendment to it filed by the Company with the Commission, and
each Preliminary Prospectus filed by the Company with the Commission. The
registration statement as amended at the time it becomes or became effective
(the "Effective Date"), including financial statements and all exhibits and any
information deemed to be included by Rule 430A, is called the "Registration
Statement." The term "Preliminary Prospectus" means any Preliminary Prospectus
(as referred to in Rule 430 or Rule 430A of the Rules) included at any time as a
part of the registration statement and the term "Prospectus" means the
prospectus relating to the Shares that is first filed pursuant to Rule 424(b)
after the date hereof.
Any reference herein to the Registration Statement, any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and include any
documents incorporated by reference therein on or before the Effective Date or
the date of such Preliminary Prospectus or the Prospectus, as the case may be
(the "Incorporated Documents"), and shall be deemed to refer to and include any
documents incorporated by reference therein filed after the date of such
Registration Statement, any Preliminary Prospectus or the Prospectus.
As the Representatives, you have advised the Company that (a) you are
authorized to enter into this Agreement on behalf of the several Underwriters
and (b) the Underwriters are willing, acting severally and not jointly, to
purchase the amounts of the Underwritten Shares set forth opposite their
respective names in Schedule II hereto, plus their pro rata portion of the
Option Shares if you elect to exercise the over-allotment Option in whole or in
part for the accounts of the several Underwriters.
In consideration of the mutual agreements contained herein and of the
interests of the parties in the transactions contemplated hereby, the Company,
the Selling Stockholders and the Underwriters hereby agree as follows:
1. Representations, Warranties and Agreements
(a) The Company represents and warrants to, and agrees with, each
Underwriter as follows:
(i) The Company has been duly organized, is in compliance with
its Certificate of Incorporation, and is validly existing as a
corporation in good standing under the laws of the State of Delaware,
with full corporate power and authority to own its properties and
conduct its business as described in the Prospectus. Each significant
subsidiary (as defined by the Act) of the Company (each a "Subsidiary"
and collectively, the "Subsidiaries") has been duly incorporated and is
validly existing as a corporation, in good standing under the laws of
the jurisdiction of its organization, with full corporate power and
authority to own or lease its properties, and conduct its business. The
Company and the Subsidiaries are duly qualified to transact business in
all jurisdictions in which the
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conduct of their business or the ownership or lease of their
properties requires such qualifications except where the failure to be
so qualified would not reasonably be expected to have a Material
Adverse Effect (as defined below). The Company owns all of the
outstanding capital stock of its Subsidiaries free and clear of any
pledge, lien, security interest, encumbrance, claim or equitable
interest.
(ii) The outstanding shares of common stock of the Company,
including the Selling Stockholders Shares, have been duly and validly
authorized and issued and are fully paid and non-assessable; the Shares
are duly and validly authorized, and, if not now issued, when issued
and paid for as contemplated herein, will be fully paid and
non-assessable. There are no preemptive or other similar rights to
subscribe for or to purchase, or any restriction upon the voting or
transfer of the Shares pursuant to the Company's Certificate of
Incorporation, bylaws, or other governing documents or any agreement or
other instrument to which the Company or any of its Subsidiaries is a
party or by which any of them may be bound. Neither the filing of the
Registration Statement nor the offering of the Shares as contemplated
by this Agreement gives rise to any rights, other than those which have
been waived or satisfied, for or relating to the registration of any
shares of any class of the Company's capital stock. The Company Shares
have been approved for listing on the Nasdaq National Market, subject
to official notice of issuance.
(iii) The Shares conform in all material respects with the
statements concerning them in the Prospectus. As of the Closing Date
(as defined below) and any Option Closing Date (as defined below), if
applicable, the Company will have the authorized capital stock set
forth under the caption "Description of Capital Stock" in the
Prospectus. No further corporate approval or authority on behalf of the
Company will be required for the issuance and sale of the Shares to be
sold by the Company as contemplated herein.
(iv) Any Preliminary Prospectus, the Prospectus and the
Registration Statement comply as to form with the requirements of the
Act and the Rules, including Form S-2. The Company meets the
requirements of, and is entitled to use, Form S-2 for the Public
Offering.
(v) Neither the Commission nor any other agency, body,
authority, court or arbitrator of competent jurisdiction has, by order
or otherwise, prohibited or suspended the use of any Preliminary
Prospectus or the Prospectus relating to the proposed offering of the
Shares or, to the Company's knowledge, instituted proceedings for that
purpose. The Registration Statement, the Prospectus and any amendments
or supplements thereto at the time they became or become effective or
were filed or are filed with the Commission contained or will contain
all statements which are required to be stated therein by, and in all
material respects conformed or will conform to the requirements of, the
Act and the Rules. Neither the Registration Statement nor any amendment
thereto, and neither the Prospectus nor any supplement thereto, as of
its date and while effective, contained any untrue statement of a
material fact or omitted to state any material fact required to be
stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading; provided,
--------
however, that the Company does not make any representations or
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warranties as to information contained in or omitted from the
Registration Statement or the Prospectus, or any such amendment or
supplement, in reliance upon, and in conformity with, written
information furnished to the Company by or on behalf of any Underwriter
through the Representatives, expressly for use in the preparation
thereof as hereinafter set forth in Section 13.
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(vi) The documents which are incorporated by reference in the
Registration Statement, any Preliminary Prospectus or the Prospectus or
from which information is so incorporated by reference, when they were
filed (or, if any amendment with respect to such document was filed,
when such amendment was filed) with the Commission complied in all
material respects with the requirements of the Exchange Act, and the
rules and regulations thereunder and any documents so filed and
incorporated by reference subsequent to the Effective Date shall, when
they are so filed with the Commission, conform in all material respects
with the requirements of the Exchange Act and the rules and regulations
thereunder.
(vii) The consolidated financial statements of the Company and
the Subsidiaries, together with related notes and schedules, as set
forth or incorporated by reference in the Registration Statement,
present fairly the consolidated financial condition and the results of
operations of the Company and the Subsidiaries, at the indicated dates
and for the indicated periods. Such financial statements have been
prepared in accordance with generally accepted accounting principles
("GAAP"), consistently applied throughout the periods involved, and all
adjustments necessary for a fair presentation of results for such
periods have been made. The summary financial information and the
selected financial data included in the Prospectus present fairly in
accordance with GAAP the information shown therein and have been
compiled on a basis consistent with that of the audited and unaudited
financial statements from which they were derived.
(viii) Except as is disclosed in the Prospectus, there is no
action or proceeding pending or, to the knowledge of the Company,
threatened against the Company, any of its Subsidiaries or any of their
respective officers or any of their properties, assets or rights before
any court or administrative or governmental agency or other body which
reasonably would be expected to (A) result in any material adverse
change in the financial condition, or in the earnings, business,
affairs, properties, business prospects or results of operations of the
Company and its Subsidiaries taken as a whole ("Material Adverse
Change" or "Material Adverse Effect," as the case may be), whether or
not arising in the ordinary course of business, (B) adversely affect
the performance of this Agreement or the consummation of the
transactions herein contemplated, except as disclosed in the Prospectus
and for which the Company maintains a reserve in an amount which it
believes is adequate to cover potential liabilities, or (C) be required
to be disclosed in the Registration Statement.
(ix) The Company and each of its Subsidiaries are not in
violation of any law, ordinance, governmental rule or regulation or
court decree to which they may be subject which violation reasonably
would be expected to have a Material Adverse Effect.
(x) The Company and its Subsidiaries have (A) to the best of
the Company's knowledge, good and marketable title to all of the real
properties and (B) valid title to all other assets reflected in the
consolidated financial statements hereinabove described or as described
in the Prospectus as being owned by them, subject to no lien, mortgage,
pledge, charge or encumbrance of any kind except those securing
indebtedness described in such financial statements or as described in
the Prospectus or which do not materially affect the present or
proposed use of such properties or assets or would not cause a Material
Adverse Effect. The Company and its Subsidiaries occupy their leased
properties under valid, subsisting and binding leases with only such
exceptions as in the aggregate are not material and do not interfere
with the conduct of the business of the Company and its Subsidiaries.
There exists no default by the Company, or to the Company's knowledge,
of any other
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party, under the provisions of any lease, contract or other
obligation to which the Company is a party which may result in a
Material Adverse Change.
(xi) The Company and its Subsidiaries have filed all federal,
state and other tax returns and reports which have been required to be
filed and have paid all taxes indicated by said returns and all
assessments received by them to the extent that such taxes have become
due and there is no tax deficiency that has been or, to the Company's
knowledge, might be asserted against the Company or any of its
Subsidiaries that might have a Material Adverse Effect. All material
tax liabilities are adequately provided for on the books of the Company
and its Subsidiaries.
(xii) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, as they may be
amended or supplemented, and except as set forth in the Registration
Statement, (A) there has not been any Material Adverse Change nor, to
the knowledge of the Company, is any such change threatened, (B) there
has not been any transaction entered into by the Company or its
Subsidiaries that is material to the earnings, business, affairs,
properties, business prospects or operations of the Company and its
Subsidiaries taken as a whole, other than transactions in the ordinary
course of business and changes and transactions contemplated by the
Registration Statement and the Prospectus, as they may be amended or
supplemented, (C) other than changes in the amounts outstanding under
the Company's and its Subsidiaries' revolving credit facilities, there
has not been any material change in the capital stock, long-term debt
or material liabilities of the Company or its Subsidiaries, and (D)
there has not been any dividend or distribution of any kind declared,
paid or made on the capital stock of the Company. Neither the Company
nor any Subsidiary has any contingent obligations or liabilities which
are required to be but are not disclosed in the Registration Statement
and the Prospectus.
(xiii) The filing of the Registration Statement and related
Prospectus and the execution and delivery of this Agreement have been
duly authorized by the Board of Directors of the Company; this
Agreement constitutes a valid and binding obligation of the Company
enforceable in accordance with its terms except as enforceability may
be limited by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other laws affecting creditors' rights
generally and by general principles of equity and federal and state
securities laws. Neither the Company nor any of its Subsidiaries is in
breach or violation of or default under any indenture, mortgage, deed
of trust, lease, contract, note or other agreement or instrument to
which it is a party or by which it or any of its properties is bound
and which breach, violation or default would reasonably be expected to
have a Material Adverse Effect. The consummation of the transactions
herein contemplated and the fulfillment of the terms hereof will not
result in a breach or violation of any of the material terms and
provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, lease, contract, note or other agreement or instrument
to which the Company or any Subsidiary is a party, or of the Company's
or any Subsidiary's Certificate of Incorporation or bylaws or any law,
decree, order, rule, writ, injunction or regulation applicable to the
Company or any Subsidiary of a court or of any regulatory body or
administrative agency or other governmental body having jurisdiction
over the Company and its Subsidiaries except for such breaches,
violations or defaults as would not reasonably be expected to have a
Material Adverse Effect.
(xiv) Each approval, consent, order, authorization,
designation, declaration or filing by or with any regulatory,
administrative or other governmental body necessary in
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connection with the execution and delivery by the Company of this
Agreement and performance of its obligations hereunder (except such
additional steps as may be necessary to qualify the Shares for public
offering by the Underwriters under state securities or Blue Sky laws,
and filing the Prospectus under Rule 424(b)) has been obtained or made
and is in full force and effect.
(xv) The Company and each Subsidiary hold all material
licenses, authorizations, charters, certificates and permits from
governmental authorities which are necessary to the conduct of their
businesses, except where the failure to hold any such licenses,
authorizations, charters, certificates or permits would not reasonably
be expected to result in a Material Adverse Effect, and neither the
Company nor any Subsidiary has received notice of any proceeding
relating to the revocation or modification of any of such licenses,
authorizations, charters, certificates or permits. The Company and its
Subsidiaries own or otherwise possess rights to the patents, patent
rights, licenses, inventions, copyrights, trademarks, service marks and
trade names presently employed by them in connection with the
businesses now operated by them as described in the Prospectus, and
neither the Company nor any of its Subsidiaries has infringed or
received any notice of infringements of or conflict with asserted
rights of others with respect to any of the foregoing, except where
such infringement or conflict would not reasonably be expected to
result in a Material Adverse Effect.
(xvi) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLP, independent auditors, who have
certified certain of the financial statements filed with the Commission
and incorporated by reference in the Registration Statement and
Prospectus, are independent public accountants within the meaning of
the Act, the Rules and Regulation S-X of the Commission and Rule 101 of
the Code of Professional Ethics of the American Institute of Certified
Public Accountants.
(xvii) There are no agreements, contracts or other documents
of a character required to be described in the Registration Statement
or the Prospectus or required by Form S-2 to be filed as exhibits to
the Registration Statement or incorporated by reference in the
Registration Statement which are not described, filed or incorporated
as required.
(xviii) No labor dispute is pending or, to the knowledge of
the Company, threatened by the Company's or any Subsidiary's employees
which could result in a Material Adverse Effect. No collective
bargaining agreement exists with any of the Company's employees and, to
the Company's knowledge, no agreement is imminent.
(xix) Except as contemplated by Section 2 hereof and as
disclosed in the Prospectus and permitted by the Rules, the Company has
not (itself or through any person) taken and will not take, directly or
indirectly, any action designed to or which might reasonably be
expected to, cause or result in a violation of Section 5 of the Act or
Regulation M under the Act or in stabilization or manipulation of the
price of the Company's common stock.
(xx) Without limiting the generality of any of the foregoing
representations and warranties and except to the extent no Material
Adverse Effect would reasonably be expected to occur, (a) none of the
operations of the Company or its Subsidiaries is in violation of any
material environmental law, regulation or any permit; (b) neither the
Company nor any of its Subsidiaries has been notified that it is under
investigation or under review by any governmental agency with respect
to compliance therewith or with respect to the generation, use,
treatment, storage or release of hazardous material; (c) neither the
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Company nor any of its Subsidiaries have any material liability in
connection with the past generation, use, treatment, storage, disposal
or release of any hazardous material; (d) there is no hazardous
material that may reasonably be expected to pose any material risk to
safety, health, or the environment, on, under or about any property
owned, leased or operated by the Company or any of its Subsidiaries or,
to the knowledge of the Company, any property adjacent to any such
property; and (e) there has heretofore been no release of any hazardous
material on, under or about such property, or, to the knowledge of the
Company, any such adjacent property. None of the present or, to the
knowledge of the Company, past property of the Company or any of its
Subsidiaries is listed or proposed for listing on the National
Priorities List pursuant to the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended ("CERCLA"), or on
the Comprehensive Environmental Response Compensation Liability
Information System List ("CERCLIS") or any similar state list of sites
requiring remedial action. Neither the Company nor any of its
Subsidiaries is subject to any state Environmental Property Transfer
Act, or to the extent that any such statute is applicable to any
property, the Company and its Subsidiaries have fully complied with
their obligations under such statute(s), and neither has any
outstanding obligations or liabilities under any state Environmental
Property Transfer Act.
(xxi) The Company and its Subsidiaries maintain insurance of
the types and in the amounts customary for their businesses, including,
but not limited to, insurance covering liability and real and personal
property owned or leased by the Company against theft, damage,
destruction, acts of vandalism and all other risks customarily insured
against, all of which insurance is in full force and effect.
(xxii) Neither the Company nor any Subsidiary has at any time
during the last five years (a) made any unlawful contribution to any
candidate for foreign office, or failed to disclose fully any
contribution in violation of law, or (b) made any payment to any
federal or state governmental officer or official, or other person
charged with similar public or quasi-public duties, other than payments
required or permitted by the laws of the United States or any
jurisdiction thereof.
(xxiii) Each executive officer or director of the Company who
is not a Selling Stockholder has executed a lock-up agreement, a form
of which is attached hereto as Exhibit "A" (the "Lock-Up Agreement").
(b) Each Selling Stockholder, severally and not jointly,
represents and warrants as follows:
(i) Such Selling Stockholder has duly executed and delivered a
power of attorney (individually, a "Power of Attorney" and with all
other powers of attorney, collectively the "Powers of Attorney"), in
the form heretofore delivered to the Representatives, appointing the
person named therein as such Selling Stockholder's attorney-in-fact
(the "Attorney-in-Fact") with authority to perform this Agreement on
behalf of such Selling Stockholder. Certificates in negotiable form for
the Shares to be sold by such Selling Stockholder hereunder have been
delivered to the Company's transfer agent for the purpose of delivery
pursuant to this Agreement. All authorizations, orders and consents
necessary for the execution and delivery by such Selling Stockholder of
this Agreement and the Power of Attorney have been duly and validly
given, and such Selling Stockholder has full legal right, power and
authority to enter into this Agreement and the Power of Attorney and to
sell, assign, transfer and deliver to the several Underwriters the
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Shares to be sold by such Selling Stockholder hereunder. Such Selling
Stockholder agrees that the Shares to be sold by such Selling
Stockholder that are represented by the certificates delivered to the
transfer agent are for the benefit of, coupled with and subject to the
interests of the Underwriters hereunder, that the arrangements made for
the appointment of the Attorney-in-Fact are to that extent irrevocable,
and that the obligations of such Selling Stockholder hereunder shall
not be terminated except as provided in this Agreement or the Power of
Attorney, by any act of such Selling Stockholder, by operation of law
or otherwise, whether by death or incapacity or by the occurrence of
any other event. If such Selling Stockholder should die or become
incapacitated or if any other event shall occur before delivery of
Shares to be sold by such Selling Stockholder hereunder, the
certificates for such Shares delivered to the transfer agent shall be
delivered by the transfer agent in accordance with this Agreement as if
such death, incapacity or other event had not occurred, regardless of
whether the transfer agent or the Attorney-in-Fact shall have received
notice thereof.
(ii) Such Selling Stockholder will have at the Closing (as
such date is hereinafter defined) good and valid title to the portion
of the Shares to be sold by such Selling Stockholder, free of any
liens, encumbrances, equities and claims, and full right, power and
authority to effect the sale and delivery of such Shares; and upon the
delivery of and payment for such Shares pursuant to this Agreement,
good and valid title thereto, free of any liens, encumbrances, equities
and claims, will be transferred to the several Underwriters.
(iii) The consummation by such Selling Stockholder of the
transactions herein contemplated and the fulfillment of the terms
hereof will not result in a breach of any of the terms and provisions
of, or constitute a default under, any indenture, mortgage, deed of
trust or other agreement or instrument to which such Selling
Stockholder is a party, or of any order, rule or regulation applicable
to such Selling Stockholder of any court, or of any regulatory body or
administrative agency or other governmental body having jurisdiction.
(iv) Such Selling Stockholder has not taken and will not take
for a period of 180 days following the date hereof, directly or
indirectly, any action designed to, or which has constituted, or which
might reasonably be expected to cause or result in stabilization or
manipulation of the price of the common stock of the Company.
(v) Such Selling Stockholder has not distributed and will not
distribute any prospectus or other offering material in connection with
the offering and sale of the Shares other than the Preliminary
Prospectus and the Prospectus or other material permitted by the Act.
(vi) All information furnished to the Company by such Selling
Stockholder or on such Selling Stockholder's behalf for use in
connection with the preparation of the Registration Statement and
Prospectus (including, without limiting the foregoing, all
representations and warranties of such Selling Stockholder in such
Selling Stockholder's Power of Attorney) is true and correct and does
not omit to state any material fact necessary to be stated therein in
order to make such information not misleading.
(vii) Such Selling Stockholder has no reason to believe that
the representations and warranties of the Company contained in this
Section 1 are not true and correct, is familiar with the Registration
Statement and has no knowledge of any material fact, condition or
information not disclosed in the Prospectus which has adversely
affected or
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may adversely affect the business of the Company or the Subsidiaries,
and the sale of the portion of the Shares to by sold by such Selling
Stockholder pursuant hereto is not prompted by any information
concerning the Company or the Subsidiaries which is not set forth in
the Prospectus.
(c) Any certificate signed by any officer of the Company and
delivered to you or counsel for the Underwriters shall be deemed a
representation and warranty by the Company to the Underwriters as to
the matters covered thereby.
2. Purchase, Sale and Delivery of the Underwritten Shares. On the basis
of the representations, warranties and covenants herein contained, and subject
to the terms and conditions herein set forth, the Company and the Selling
Stockholders, severally and not jointly, agree to sell to each Underwriter, and
each Underwriter agrees, severally and not jointly, to purchase, at a price of
$______ per share, the respective number of the Underwritten Shares set forth
opposite the name of the Company and each Selling Stockholder on Schedule II
attached hereto. The obligation of each Underwriter to the Company and to each
Selling Stockholder shall be to purchase from the Company or such Selling
Stockholder that number of Company Shares or Selling Stockholders Shares, as the
case may be, which (as nearly as practicable, as determined by you) is in the
same proportion to the number of Company Shares or Selling Stockholders Shares,
as the case may be, set forth opposite the name of the Company or such Selling
Stockholder in Schedule I hereto as the number of Underwritten Shares which is
set forth opposite the name of such Underwriter in Schedule II hereto (subject
to adjustment as provided as provided in Section 10 hereof) is to the total
number of Underwritten Shares to be purchased by all of the Underwriters under
this Agreement.
Payment for the Underwritten Shares shall be made by wire transfer of
immediately available U.S. Funds to designated accounts, to the order of the
Sellers, against delivery of certificates for the Shares to the Representatives
for the accounts of the several Underwriters. Delivery of certificates shall be
to the Representatives c/o Stephens Inc. ("Stephens"), ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other address as Stephens may designate in
writing. Payment will be made at the offices of ▇▇▇▇▇▇▇▇, or at such other place
as shall be agreed upon by ▇▇▇▇▇▇▇▇ and the Sellers, at approximately 9:00 a.m.,
central time, on ____________, 2002, such time and date being herein referred to
as the "Closing Date." The certificates for the Underwritten Shares will be
delivered in such denominations and in such registrations as ▇▇▇▇▇▇▇▇ reasonably
requests in writing and will be made available for inspection at such locations
as ▇▇▇▇▇▇▇▇ may reasonably request at least one full business day prior to the
Closing Date.
In addition, on the basis of the representations, warranties,
agreements and covenants herein contained and subject to the terms and
conditions herein set forth, the Company hereby grants the Option to the several
Underwriters to purchase the Option Shares at the price per share as set forth
in the first paragraph of this Section 2. The Option may be exercised in whole
or in part on one occasion upon written notice (or oral notice, subsequently
confirmed in writing) given not more than thirty (30) days following the date of
this Agreement, by ▇▇▇▇▇▇▇▇, on behalf of the Representatives of the several
Underwriters, to the Company setting forth the number of Option Shares as to
which the several Underwriters are exercising the Option and the names and
denominations in which the Option Shares are to be registered. Closing on the
purchase of the Option Shares (the "Option Closing Date"), if any, shall occur
no later than three (3) business days following the date upon which notice of
exercise of the Option is given to the Company, and shall take place at the
offices of ▇▇▇▇▇▇▇▇, or at such other place as shall be agreed upon by ▇▇▇▇▇▇▇▇
and the Company. Subject to Section 10, the number of Option Shares to be
purchased by each Underwriter shall be in the same proportion to the total
number of shares of the common stock being purchased by such Underwriter bears
to 3,475,000 shares, adjusted by you in such manner as to avoid fractional
shares. The Option may be exercised only to cover over-allotments in the sale of
the Underwritten Shares by the
9
Underwriters. ▇▇▇▇▇▇▇▇, on behalf of the Representatives of the several
Underwriters, may cancel such Option at any time prior to its expiration by
giving written notice (or oral notice, subsequently confirmed in writing) of
such cancellation to the Company. To the extent, if any, that the Option is
exercised, payment for the Option Shares shall be made by wire transfer of
immediately available U.S. Funds to a designated account of the Company, to the
order of the Company. Certificates for the Option Shares shall be delivered in
the same manner and upon the same terms as the Underwritten Shares.
3. Offering by the Underwriters. It is understood that the Public
Offering of the Underwritten Shares is to be made as soon as the Representatives
deem it advisable to do so after the Registration Statement has become
effective. The Underwritten Shares are to be initially offered to the public at
the public offering price set forth in the Prospectus. The Representatives may
from time to time thereafter change the public offering price and other selling
terms. To the extent, if at all, that any Option Shares are purchased pursuant
to Section 2 hereof, the Underwriters will offer them to the public on the
foregoing terms.
It is further understood that you will act as the Representatives for
the Underwriters in the offering and sale of the Shares, in accordance with an
Agreement Among Underwriters which has been entered into by you and the several
other Underwriters.
4. Covenants of the Company and the Selling Stockholders. The Company
covenants and agrees, and the Selling Stockholders covenant and agree, each for
himself and with respect only to paragraphs (j) and (l), with each of the
several Underwriters that:
(a) The Company will use its best efforts to cause the
Registration Statement to become effective and will not, either before
or after effectiveness, file any amendment thereto or supplement to the
Prospectus (including a prospectus filed pursuant to Rule 424(b) which
differs from the Prospectus on file at the time the Registration
Statement becomes effective) or file any documents under the Exchange
Act before the earlier to occur of (A) the 35th day following the
Effective Date or (B) the closing date of the Underwriters' purchase of
the Option Shares if such document would be deemed to be incorporated
by reference into the Registration Statement, the Preliminary
Prospectus or the Prospectus of which the Representatives shall not
previously have been advised and furnished with a copy or to which the
Representatives shall have reasonably objected in writing or which is
not in compliance with the Act or Rules or the Exchange Act or the
rules and regulations thereunder.
(b) The Company will advise the Representatives promptly of any
request of the Commission or other securities regulatory agency ("Other
Securities Regulator") for amendment of the Registration Statement or
for supplement to the Prospectus or for any additional information, or
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the use of the
Prospectus or of the institution of any proceedings for that purpose,
or comparable action taken or initiated by any Other Securities
Regulator, and the Company will use its reasonable efforts to prevent
the issuance of any such stop order preventing or suspending the use of
the Prospectus and to obtain as soon as possible the lifting thereof,
if issued.
(c) The Company will use its reasonable efforts with the
Representatives in endeavoring to qualify the Shares for sale under the
securities laws of such jurisdictions (including foreign jurisdictions)
as the Representatives may reasonably designate, and will make such
applications, file such documents, and furnish such information as may
be reasonably required for that purpose; provided, however, 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 where it is
not so qualified or required to file such a consent. The Company will,
from time to time, prepare and file
10
such statements, reports, and other documents, as are or may be
required to continue such qualifications in effect for so long a period
as the Representatives may reasonably request for distribution of the
Shares.
(d) The Company will deliver to, or upon the order of, the
Representatives, from time to time, as many copies of any Preliminary
Prospectus or the Prospectus as the Representatives may reasonably
request. The Company will deliver to, or upon the order of, the
Representatives, on the Effective Date and thereafter from time to time
during the period necessary to effect the distribution of the Shares as
many copies of the Prospectus in final form, or as thereafter amended
or supplemented, as the Representatives may reasonably request. The
Company will deliver to each of the Representatives at or before the
Closing Date, one (1) manually signed copy of the Registration
Statement and all amendments thereto including all exhibits filed
therewith and will deliver to the Representatives such number of copies
of the Registration Statement, but without exhibits, and of all
amendments thereto, as the Representatives may reasonably request.
(e) During the time necessary to effect the distribution of the
Shares, the Company shall comply with all requirements imposed upon it
by the Act, as now and hereafter amended, and by the Rules, as from
time to time in force, so far as is necessary to permit the continuance
of sales of or dealings in the Shares as contemplated by the provisions
hereof and the Prospectus. If, during the period necessary to effect
the distribution of the Shares, any event shall occur as a result of
which, in the judgment of the Company or in the opinion of counsel for
the Underwriters, it becomes necessary to amend or supplement the
Prospectus in order to make the statements therein, in the light of the
circumstances existing at the time the Prospectus is delivered to a
purchaser, not misleading, or, if it is necessary at any time to amend
or supplement the Prospectus to comply with any law or to file under
the Exchange Act any document which would be deemed to be incorporated
by reference in the Prospectus in order to comply with the Act or the
Exchange Act, the Company promptly will notify the Representatives and,
subject to the Representatives' prior review, prepare and file with the
Commission and any appropriate Other Securities Regulator an
appropriate amendment or supplement to the Prospectus or file such
document (at the expense of the Company) so that the Prospectus as so
amended or supplemented will not, in light of the circumstances when it
is so delivered, be misleading, or so that the Prospectus will comply
with the law.
(f) The Company will make generally available to its security
holders in the manner contemplated by Rule 158(b) under the Act, as
soon as it is practicable to do so, but in any event not later than the
90th day after the end of the fiscal quarter first occurring one year
after the Effective Date, an earnings statement in reasonable detail,
covering a period of at least twelve consecutive months beginning after
the Effective Date, which earnings statement shall satisfy the
requirements of Section 11(a) of the Act and will advise you in writing
when such statement has been so made available.
(g) For a period of three years from the date of this Agreement,
the Company will furnish to the Representatives (a) concurrently with
furnishing of such reports to its stockholders, statements of income of
the Company for each quarter in the form furnished to the Company's
stockholders; (b) concurrently with furnishing to its stockholders, a
balance sheet of the Company as at the end of such fiscal year,
together with statements of earnings, stockholders' equity and cash
flow of the Company for such fiscal year, all in reasonable detail and
accompanied by a copy of the certificate or report thereon of
independent public accountants; (c) as soon as they are available,
copies of all reports (financial or other) mailed to stockholders; (d)
as soon as they are available, copies of all reports and financial
statements furnished to or filed with the Commission; (e) every press
release which was released or prepared by the Company; and (f) any
additional information of
11
a public nature concerning the Company or its business which you may
reasonably request. During such period, if the Company shall have
active subsidiaries the foregoing financial statements shall be on a
consolidated basis to the extent that the accounts of the Company and
its subsidiaries are consolidated, and shall be accompanied by similar
financial statements for any significant subsidiary (as defined by the
Act) which is not so consolidated.
(h) Promptly after the Company is advised thereof, it will
advise the Representatives, and confirm in writing, that the
Registration Statement and any amendments shall have become effective.
(i) The Company will use the net proceeds from the sale of the
Shares substantially in the manner set forth in the Prospectus under
the caption "Use of Proceeds."
(j) Other than as permitted by the Act and the Rules, the
Company and the Selling Stockholders will not distribute any prospectus
or offering materials in connection with the offering and sale of the
Shares and prior to the Closing Date or, if applicable, the Option
Closing Date will not issue any press releases or other communications
directly or indirectly and will hold no press conferences with respect
to the Company, the financial condition, results of operations,
business, properties, assets or liabilities of the Company, or the
offering of the Shares, without the prior written consent of the
Representatives.
(k) The Company will maintain a transfer agent and, if necessary
under the jurisdiction of incorporation of the Company, a registrar for
its common stock and will use its best efforts to maintain the listing
of the Shares on the Nasdaq National Market.
(l) Except pursuant to the exercise of stock options existing
prior to the execution of this Agreement or as contemplated hereby or
by the Prospectus, the Company and the Selling Stockholders will not,
for a period of ninety (90) days after the Effective Date of the
Registration Statement, offer to sell, contract to sell, sell or
otherwise dispose of any shares of the Company's common stock or
securities convertible into shares of the Company's common stock
without the prior written consent of the Representatives, which consent
will not be unreasonably withheld.
The foregoing covenants and agreements shall apply to any successor of
the Company, including without limitation, any entity into which the Company
might consolidate or merge.
5. Costs and Expenses. Whether or not the Registration Statement
becomes effective, the Company and the Selling Stockholders will pay all costs,
expenses and fees incident to the performance of the obligations of the Company
and the Selling Stockholders under this Agreement, including, without limiting
the generality of the foregoing, the following: accounting fees of the Company;
the fees and disbursements of counsel for the Company; the cost of printing and
delivering to Underwriters copies of the Registration Statement, any Preliminary
Prospectus, the Prospectus, this Agreement, the Agreement Among Underwriters,
the Selected Dealer Agreement, Underwriters' Questionnaire and Power of
Attorney, and the Blue Sky Survey and any supplements thereto; the filing fees
of the Commission; the filing fees incident to securing any required review by
the NASD of the terms of the sale of the Shares on behalf of, and any
disbursements made by, the Representatives; any applicable listing fees; the
cost of printing certificates representing the Shares; and the cost and charges
of any transfer agent or registrar. Any transfer taxes imposed on the sale of
the Shares to the Underwriters will be paid by the Company or the Selling
Stockholders, as appropriate. Neither the Company nor the Selling Stockholders
shall, however, be required to pay for any of the Underwriters' expenses (other
than those related to qualification under State securities or Blue Sky laws)
except that, if the Public Offering shall not be consummated because the
conditions in
12
Section 7 hereof are not satisfied, or because this Agreement is terminated by
the Representatives pursuant to Section 6 hereof, or by reason of any failure,
refusal or inability on the part of the Company to perform any undertaking or
satisfy any condition of this Agreement or to comply with any of the terms
hereof on their part to be performed, unless such failure to satisfy said
condition or to comply with said terms is due to the default or omission of any
Underwriter, then the Company shall reimburse the several Underwriters for all
costs and expenses, including attorney fees and out-of-pocket expenses,
reasonably incurred in connection with investigating, marketing and proposing to
market the Shares or in contemplation of performing their obligations hereunder,
but the Company shall not in any event be liable to any of the several
Underwriters for damages on account of loss of anticipated profits from the sale
by them of the Shares. The Company and the Selling Stockholders may agree, as
among themselves and without limiting the rights of the Underwriters under this
Agreement, as to the respective amounts of such costs for which they each shall
be responsible.
6. Conditions of Obligations of the Underwriters. The obligations of
the several Underwriters to purchase and pay for the Shares as provided herein
are subject to the accuracy, as of the Closing Date and as of the Option Closing
Date, of the representations and warranties and agreements of the Company and
the Selling Stockholders contained herein and to the performance by the Company
and the Selling Stockholders of their obligations hereunder and to the following
additional conditions:
(a) The Registration Statement shall have become effective not
later than 10:00 a.m., central time, on the day immediately following
the date of this Agreement, unless a later time and date is agreed to
by the Representatives, and no stop order or other order suspending the
effectiveness thereof or the qualification of the Shares under the
State securities or Blue Sky laws of any jurisdiction shall have been
issued and no proceeding for that purpose shall have been taken or, to
the knowledge of the Company or the Selling Stockholders, shall be
contemplated or threatened by the Commission or any Other Securities
Regulator. If the Company has elected to rely upon Rule 430A of the
Rules, the price of the Shares and any price-related information
previously omitted from the effective Registration Statement pursuant
to such Rule 430A shall have been transmitted to the Commission for
filing pursuant to Rule 424(b) of the Act within the prescribed time
period, and prior to the Closing Date the Company shall have provided
evidence satisfactory to the Representatives of such timely filing, or
a post-effective amendment providing such information shall have been
promptly filed and declared effective in accordance with the
requirements of Rule 430A under the Act. All requests for additional
information on the part of the Commission or any other government or
regulatory authority with jurisdiction (to be included in the
Registration Statement or Prospectus or otherwise) shall be complied
with to the satisfaction of the Commission or such authorities.
(b) The Representatives shall have received on the Closing Date
and on the Option Closing Date the opinion of ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇, LLP, counsel for the Company and the Selling Stockholders,
with respect to the Company and the Selling Stockholders as to the
matters set forth below in subparagraphs (i) through (x), and opinions
of _________ counsel to the Company with respect to the Subsidiaries,
as to matters set forth below in subparagraphs (i) and (vi), each dated
the Closing Date and, if applicable, the Option Closing Date, addressed
to the Underwriters in form and substance satisfactory to ▇▇▇▇▇▇,
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel to the Underwriters, to the effect
that:
(i) The Company and the Subsidiaries have been duly
organized and are validly existing in good standing under the
laws of the state(s) or similar foreign jurisdictions (with
respect to the Subsidiaries) of their organization with
corporate power to own their properties and conduct their
business as described in the Registration Statement and
Prospectus; and to such counsel's knowledge, except as set forth
in the Prospectus and
13
the Registration Statement, no options, warrants or other
rights to purchase, agreements or other obligations to issue or
other rights to convert any obligations into any shares of
capital stock of the Company are outstanding.
(ii) The Company has authorized capital stock as set
forth under the caption "Description of Capital Stock" in the
Registration Statement and Prospectus, except for issuances
subsequent to the date of the Prospectus, if any, pursuant to
reservations, commitments, employee benefit plans, or other
existing agreements; all of the Shares conform to the
description thereof contained in the Prospectus; the Company
Shares and the Option Shares, if any, have been duly authorized
by all necessary corporate action on the part of the Company
and, upon payment for and delivery of the Shares in accordance
with this Agreement and the countersigning of the certificates
representing the Shares by a duly authorized signatory, the
Shares will be validly issued, fully paid and non-assessable;
holders of the capital stock of the Company are not entitled to
any preemptive right to subscribe to any additional shares of
the Company's capital stock under the Company's Certificate of
Incorporation or bylaws, or, to such counsel's knowledge, any
agreement or other instrument filed as an exhibit to the
Registration Statement.
(iii) The Registration Statement has been declared
effective under the Act and to such counsel's knowledge, no stop
order suspending the effectiveness of the Registration Statement
has been issued or threatened by the Commission.
(iv) The Registration Statement and each amendment or
supplement thereto on the dates they were filed appeared on
their face to comply as to form in all material respects with
the requirements as to form for registration statements on Form
S-2 under the Act and the Rules, except that such counsel need
express no opinion as to the information supplied by the
Underwriters or the financial statements, schedules and other
financial or statistical information included or incorporated
by reference therein. The Incorporated Documents, on the
respective dates they were filed, appeared on their face to
comply in all material respects with the requirements as to
form for reports on Form 10-K, Form 10-Q and Form 8-K, as the
case may be, under the Exchange Act and the rules and
regulations thereunder in effect at the respective dates of
their filing, except that such counsel need express no opinion
as to the financial statements, schedules and other financial
or statistical information included or incorporated by
reference therein.
(v) Except as set forth in the Registration Statement and
the Prospectus, to such counsel's knowledge, 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 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 being registered pursuant to a
registration statement filed by the Company under the Act.
(vi) To such counsel's knowledge, the Company's execution
and delivery of, and performance of its obligations under, this
Agreement do not (A) violate the Company's and its
Subsidiaries' respective charter or bylaws, or (B) breach or
otherwise violate any existing obligation of or restriction on
the Company or its Subsidiaries under any order, judgment or
decree of any federal or Delaware court or government authority
binding on the Company or its Subsidiaries that such counsel
has, in the exercise of customary professional diligence,
recognized as applicable to the Company or its Subsidiaries or
to transactions of the type contemplated by this Agreement,
except that such counsel need not
14
express an opinion regarding any federal securities laws or Blue
Sky or state securities laws. The execution and delivery by the
Company of, and performance of its obligations under, this
Agreement, do not violate any Delaware or federal statute or
regulation that such counsel has, in the exercise of customary
professional diligence, recognized as applicable to the Company
or its Subsidiaries or to transactions of the type contemplated
by this Agreement, except that such counsel need not express an
opinion regarding any federal securities laws or Blue Sky or
state securities laws.
(vii) This Agreement has been duly authorized, executed
and delivered by the Company.
(viii) No approval, consent, order or permit of Delaware
or any U.S. Federal governmental authority is required on the
part of the Company for the execution and delivery of this
Agreement or for the issuance and sale of the Shares by the
Company herein contemplated (other than required by NASD
regulation or state securities and Blue Sky laws, as to which
such counsel need express no opinion) except such as have been
obtained or made, specifying the same.
(ix) This Agreement has been duly executed and delivered
on behalf of each of the Selling Stockholders.
(x) Upon the delivery of and payment for the Selling
Stockholders Shares as contemplated in this Agreement, each of
the Underwriters will receive such Shares purchased by it from
such Selling Stockholder, free and clear of any adverse claim.
In rendering such opinion, such counsel may assume that the
Underwriters are acquiring such Shares in good faith, without
notice of any adverse claim.
In addition to the matters set forth above, such counsel shall also
include a statement to the effect that such counsel has participated in the
preparation of the Registration Statement and the Prospectus and, based on such
participation, no facts have come to the attention of such counsel which
appeared on their face to cause such counsel to believe that any part of the
Registration Statement or any amendment thereto (other than the financial
statements and other financial and statistical data contained therein, as to
which such counsel may express no belief), as of its effective date, contained
any untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading or that the Prospectus or any amendment or supplement thereto (other
than the financial statements and other financial data contained therein, as to
which such counsel may express no belief), contains any untrue statement of a
material fact or omitted to state any material fact necessary in order to make
the statements therein, in light of the circumstances under which they were
made, not misleading. Such counsel does not know of any legal or governmental
proceedings required to be described in the Registration Statement or the
Prospectus which are not described as required or of any contracts or documents
of a character required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement which are
not described and filed as required; it being understood that such counsel need
express no opinion as to the financial statements or other financial data
contained in the Registration Statement or the Prospectus. Such counsel may
state that its opinion is limited to the applicable law of the United States of
America, the Delaware General Corporation Law and the general corporate law of
jurisdictions under which the Subsidiaries are organized, and that such counsel
renders no opinion with respect to the law of any other jurisdiction. Such
opinion may state further that whenever such opinion is based on factual matters
to such counsel's knowledge or known to such counsel, such counsel has relied
exclusively on certificates of officers (after discussion of the contents
thereof with such officers) of the
15
Company or certificates of others as to the existence or nonexistence of factual
matters on which such opinion is predicated but has no reason to believe that
any such certificate is untrue or inaccurate in any material respect.
Such opinion shall contain only those qualifications as ▇▇▇▇▇▇,
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel to the Underwriters, may reasonably request or
allow.
(c) The Representatives shall have received from ▇▇▇▇▇▇, ▇▇▇▇▇▇▇
& ▇▇▇▇▇▇▇▇ LLP, counsel to the Underwriters, an opinion dated the
Closing Date, substantially to the effects specified in subparagraph
(iii) and (iv) of paragraph (b) of this Section 6, and that the
Company is a validly organized and existing corporation under the laws
of the State of Delaware. In rendering such opinion, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ LLP may rely as to all matters governed other than by Federal
law on the opinions of counsel referred to in paragraph (b) of this
Section 6. In addition to the matters set forth above, such opinion
shall also include a statement to the effect that nothing has come
to the attention of such counsel which leads them to believe that the
Registration Statement or any amendment thereto at the time the
Registration Statement or amendment became effective or the
Preliminary Prospectus or the Prospectus or any amendment or
supplement thereto as of their respective dates 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 (except that such counsel need express no view as to
financial statements, schedules and other financial or statistical
information included therein).
(d) The Representatives shall have received at or prior to the
Closing Date from ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP a memorandum or
summary, in form and substance satisfactory to the Representatives,
with respect to the qualification or exemption therefrom for offering
and sale by the Underwriters of the Shares under the State securities
or Blue Sky laws of such jurisdictions as the Representatives may
reasonably have designated.
(e) The Representatives shall have received on the Closing Date
and on the Option Closing Date, as the case may be, signed letters
from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLP, addressed to the Underwriters dated as of
the Effective Date and again dated as of the Closing Date and as of
the Option Closing Date, as the case may be, with respect to the
financial statements and certain financial and statistical information
contained in the Registration Statement and the Prospectus. All such
letters shall be in form and substance satisfactory to the
Representatives and ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel to the
Underwriters.
(f) The Representatives shall have received on the Closing Date
and on the Option Closing Date, as the case may be, a certificate or
certificates of the Company, executed by the President and Chief
Executive Officer and the Chief Financial Officer of the Company to
the effect that, on and as of the Closing Date and on and as of the
Option Closing Date, as the case may be, each of them severally
represents as follows:
(i) (A) the representations and warranties of the Company
in this Agreement are true and correct on and as of the Closing
Date and on and as of the Option Closing Date, as the case may
be, and (B) the Company has complied with all of its agreements
and covenants and has satisfied all of the conditions on its part
to be performed or satisfied at or prior to the Closing Date and
at or prior to the Option Closing Date, as the case may be.
16
(ii) They have carefully examined the Registration Statement
and the Prospectus and, in their opinion, such Registration
Statement and Prospectus did not omit to state a material fact
necessary in order to make the statements therein not misleading.
(g) The Company shall have furnished to the Representatives
evidence of the due qualification of the Company and the Subsidiaries
to transact business in all jurisdictions in which the conduct of their
business or ownership or lease of their properties requires such
qualifications, except where the failure to be so qualified would not
reasonably be expected to have a Material Adverse Effect.
(h) Since the respective dates as of which information is given in
the Prospectus, there shall not have been any Material Adverse Change.
(i) The Company Shares shall have been approved for listing on the
Nasdaq National Market, subject to official notice of issuance.
The opinions and certificates mentioned in this Agreement shall be
deemed to be in compliance with the provisions hereof only if they are in all
material respects satisfactory to the Representatives and ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ LLP, counsel for the Underwriters.
If any of the conditions hereinabove provided for in this Section 6
shall not have been fulfilled when and as required by this Agreement to be
fulfilled, the obligations of the Underwriters hereunder may be terminated by
the Representatives by notifying the Company of such termination in writing or
by confirmed telefax at or prior to the Closing Date. In such event, the
Company, the Selling Stockholders and the Underwriters shall not be under any
obligation to each other (except to the extent provided in Sections 5 and 8
hereof).
7. Conditions of the Obligations of the Sellers. The obligations of the
Sellers to sell and deliver the Shares are subject to the conditions that (a) at
or before 10:00 a.m., central time, on the day immediately following the date of
this Agreement, or such later time and date as the Company and the
Representatives may from time to time consent to in writing or by confirmed
telefax, the Registration Statement shall have become effective, and (b) at the
Closing Date no stop order suspending the effectiveness of the Registration
Statement shall have been issued or proceedings therefor initiated or
threatened. If either of the conditions hereinabove provided for in this Section
7 shall not have been fulfilled when and as required by this Agreement to be
fulfilled, this Agreement may be terminated by the Company by notifying the
Representatives of such termination in writing or by confirmed telefax at or
prior to the Closing Date.
8. Indemnification.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter
within the meaning of the Act, the Rules and the Exchange Act from and
against any and all losses, claims, damages, liabilities, joint or
several, to which such Underwriter or such controlling person may
become subject under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of or are based upon any breach of any
representation, warranty, agreement, or covenant of the Company, or any
untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, any Preliminary Prospectus,
the Prospectus or any amendment or supplement thereto, or arise out of
or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and the Company will reimburse each
Underwriter and each such controlling person for
17
legal and other expenses reasonably incurred in connection with
investigating or defending any such loss, claim, damage, liability,
action or proceeding; provided, however, that the Company will not be
-------- -------
liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or
alleged untrue statement made in, or omission or alleged omission from,
the Registration Statement, any Preliminary Prospectus, the Prospectus,
or such amendment or supplement, in reliance upon and in conformity
with written information furnished to the Company by or through the
Representatives specifically for use in the preparation thereof, it
being understood and agreed that the only such information furnished by
any Underwriter consists of the information described as such in
Section 13 below; and provided further, that with respect to any untrue
-------- -------
statement or alleged untrue statement in or omission or alleged
omission from any Preliminary Prospectus, the indemnity agreement
contained in this Section 8(a) shall not inure to the benefit of any
Underwriter from whom the person asserting any such losses, claims,
damages or liabilities purchased the Shares concerned, to the extent
that a prospectus relating to such Shares was required to be delivered
by such Underwriter under the Act in connection with such purchase and
any such loss, claim, damage or liability of such Underwriter, results
from the fact that there was not sent or given to such person, at or
prior to the written confirmation of the sale of such Shares to such
person, a copy of the Prospectus as then amended or supplemented
(excluding any documents incorporated by reference therein) if the
Company had previously furnished copies thereof to such Underwriter.
This indemnity agreement will be in addition to any liability which the
Company may otherwise have.
(b) Each Selling Stockholder severally and not jointly agrees to
indemnify and hold harmless each Underwriter and each person, if any,
who controls any Underwriter, within the meaning of the Act, the Rules
and the Exchange Act, from and against any losses, claims, damages, or
liabilities, joint or several (or actions or proceedings in respect
thereof) and all expenses (including costs of investigation and legal
expenses) to which such Underwriters or such controlling person may
become subject under the Act or otherwise, insofar as such losses,
claims, liabilities or expenses arise out of or are based upon any
breach of any representation, warranty, agreement, or covenant of such
Selling Stockholder contained in this Agreement or any untrue statement
or alleged untrue statement of any material fact contained in the
Registration Statement, any Preliminary Prospectus, the Prospectus or
any amendment or supplement thereto, or arise out of or are based upon
the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in the Registration Statement,
any Preliminary Prospectus, the Prospectus, or any amendment or
supplement thereto, in conformity with written information furnished to
the Company by or on behalf of such Selling Stockholder specifically
for use therein; provided, however, that such Selling Stockholder
-------- -------
will not be liable in any such case to the extent that such statement
or omission was contained or made in any Preliminary Prospectus and
corrected in the Prospectus and (A) any such loss, claim, damage or
liability suffered or incurred by any Underwriter (or any person who
controls any Underwriter) resulted from any action, claim or suit by
any person who purchased Shares which are the subject thereof from such
Underwriter in the offering and (B) such Underwriter failed to deliver
or provide a copy of the Prospectus to such person at or prior to the
confirmation of the sale of such Shares, in the case where such
delivery is required by the Act. This indemnity agreement will be in
addition to any liability which the Selling Stockholders may otherwise
have.
Each Selling Stockholder shall be liable to all persons under
the indemnity agreements contained in this paragraph (b) and for
breaches of its representations contained in Section 1 hereof only for
an amount not exceeding the net proceeds received by such Selling
Stockholder from the sale of Shares hereunder.
18
(c) Each Underwriter severally, but not jointly, will
indemnify and hold harmless the Selling Stockholders and the Company,
each of its directors, each of its officers who have signed the
Registration Statement, and each person, if any, who controls the
Company, within the meaning of the Act, the Rules and the Exchange Act
from and against any losses, claims, damages or liabilities to which
the Company, or any such director, officer, or controlling person may
become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the Registration
Statement, any Preliminary Prospectus, the Prospectus or any amendment
or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading in light of the circumstances under which they were made;
and will reimburse any legal or other expenses reasonably incurred by
the Selling Stockholders or the Company, or any such director, officer,
or controlling person in connection with investigating or defending any
such loss, claim, damage, liability, action or proceeding; provided,
--------
however, that each Underwriter will be liable in such case only to the
-------
extent that such untrue statement, or alleged untrue statement or
omission or alleged omission has been made in the Registration
Statement, any Preliminary Prospectus, the Prospectus, or such
amendment or supplement, in reliance upon and in conformity with
information furnished to the Company by or through the Representatives
expressly for use in the preparation thereof, which information is
described in Section 13. This indemnity agreement will be in addition
to any liability which such Underwriter may otherwise have.
(d) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action or proceeding,
such indemnified party will, if a claim in respect thereof is to be
made against an indemnifying party under this Section 8, notify the
indemnifying party of the commencement thereof; but the omission so to
notify the indemnifying party will not relieve it from any liability
which it may have to any indemnified party otherwise than under this
Section 8, except to the extent that the indemnifying party is
substantially prejudiced by the omission of such notification. In case
any such action or proceeding is brought against any party, and it
notifies an indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein, and, to the
extent that it may wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof with counsel
reasonably satisfactory to such indemnified party, and after notice
from the indemnifying party to such indemnified party of its election
so to assume the defense thereof, the indemnifying party will not be
liable to such indemnified party under this Section 8 for any legal or
other expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending
or threatened proceeding in respect of which any indemnified party is
or could have been a party and indemnity could have been sought
hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on
claims that are the subject matter of such proceeding. Any indemnified
party shall have the right to employ separate counsel in any such
action and participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified
party unless (i) the employment of such counsel has been specifically
authorized in writing by the indemnifying party, (ii) the indemnifying
party has failed to assume the defense and employ counsel, or (iii) the
named parties to any such action (including any impleaded parties)
include such indemnified party and the indemnifying party, as the case
may be, and such indemnified party shall have been advised in writing
by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party, in which case the indemnifying party shall not have
the right to assume the
19
defense of such action on behalf of such indemnified party, it being
understood, however, that (A) the indemnifying party shall not, in
connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out of the
same general allegations or circumstances, be liable for the fees and
expenses of more than one separate firm of attorneys (in addition to
any local counsel) for all such indemnified parties, which firm shall
be designated in writing by the indemnified parties, and that (B) all
such fees and expenses shall be reimbursed as they are incurred.
Subject to the foregoing provisions of this Section 8(d), the
indemnifying party shall not be liable for the costs and expenses of
any settlement of any action without the consent of the indemnifying
party.
(e) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in this Section
8 is for any reason held to be unavailable to an indemnified party
under subsection (a), (b) or (c) above in respect to any losses,
claims, damages, liabilities or expenses referred to therein, then each
applicable indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages,
liabilities and expenses (i) in such proportion as is appropriate to
reflect the relative benefits received by the Sellers on the one hand
and the Underwriters on the other hand from the offering of the Shares
or (ii) if the allocation provided by clause (i) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the
relative fault of the parties in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities
or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Sellers on the one hand and the
Underwriters on the other hand shall be deemed to be in the same
proportion as the total proceeds from the offering (net of underwriting
discounts and commissions but before deducting expenses) received by
the Sellers bears to the underwriting discounts and commissions
received by the Underwriters. The relative fault of a party shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by
each party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses referred to above
shall be deemed to include any legal or other fees or expenses
reasonably incurred by such party in connection with investigating or
defending any such action or claim.
The Sellers and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 8 were
determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations
referred to in the immediately preceding paragraph. Notwithstanding the
provisions of this Section 8, no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price
at which the Shares underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages that such
Underwriters have otherwise been required to pay by reason of such
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 Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations in this subsection (e) to contribute shall be
several in proportion to their respective underwriting obligations and
not joint.
(f) In any proceeding relating to the Registration Statement,
any Preliminary Prospectus, the Prospectus or any supplement or
amendment thereto, each party against whom contribution may be sought
under this Section 8 hereby consents to the jurisdiction of any court
20
having jurisdiction over any other contributing party, agrees that
process issuing from such court may be served upon him or it by any
other contributing party and consents to the service of such process
and agrees that any other contributing party may join him or it as an
additional defendant in any such proceeding in which such other
contributing party is a party.
9. Representations, Warranties and Agreements to Survive Delivery. All
representations, warranties and agreements of the Selling Stockholders, the
Company, and the officers of the Company herein or in certificates delivered
pursuant hereto, and the indemnity and contribution agreements contained in
Section 8 hereof, shall remain operative and in full force and effect regardless
of any investigation made by or on behalf of any Underwriters or any controlling
person, or by or on behalf of the Company or any of its officers, directors or
controlling persons, and shall survive delivery of the Underwritten Shares and,
if appropriate, the Option Shares to the Representatives or termination of this
Agreement.
10. Default by Underwriters. If any Underwriter shall fail to purchase
and pay for the Shares which such Underwriter has agreed to purchase and pay for
hereunder (otherwise than by reason of any default on the part of the Company or
any of the Selling Stockholders), you, as the Representatives of the
Underwriters, shall use your best efforts to procure within twenty-four hours
thereafter one or more of the other Underwriters, or any others, to purchase
from the Company and the Selling Stockholders such amounts as may be agreed upon
and upon the terms set forth herein, the Shares which the defaulting Underwriter
or Underwriters failed to purchase. If during such twenty-four hours you, as
such Representatives, shall not have procured such other Underwriters, or any
others, to purchase the Shares agreed to be purchased by the defaulting
Underwriter or Underwriters, then (a) if the aggregate number of Shares with
respect to which such default shall occur does not exceed 10% of the Shares
which the Underwriters are obligated to purchase hereby, the other Underwriters
shall be obligated, severally, in proportion to the respective number of Shares
which they are obligated to purchase hereunder, to purchase the Shares which
such defaulting Underwriter or Underwriters failed to purchase, or (b) if the
aggregate number of Shares with respect to which such default shall occur
exceeds 10% of the Shares covered hereby, the Company or you, as the
Representatives of the Underwriters, will have the right, by written notice
given within the next twenty-four hour period to the parties to this Agreement,
to terminate this Agreement without liability on the part of the non-defaulting
Underwriters or the Company or the Selling Stockholders except to the extent
provided in Section 8 hereof. In the event of a default by any Underwriter or
Underwriters, as set forth in this Section 10, the time of closing may be
postponed for such period, not to exceed seven days, as you, as the
Representatives, may determine in order that the required changes in the
Registration Statement, the Prospectus or in any other documents or arrangements
may be effected. The term "Underwriters" includes any person substituted for a
defaulting Underwriter. Any action taken under Section 11 shall not relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
11. Notices. All communications hereunder shall be in writing and, except
as otherwise provided in, will be mailed, delivered or telefaxed and confirmed
as follows: if to the Underwriters, c/o the Representatives as follows: to
▇▇▇▇▇▇▇▇ Inc., ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇
▇▇▇▇▇▇, with a copy to C. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇., ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇; if to the
Company or the Selling Stockholders, to ▇.▇.▇. Transportation Services, Inc.,
▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, with a
copy to ▇▇▇▇▇▇ ▇. Starr, Smith, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, LLP, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇.▇., ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇.
12. Termination. This Agreement may be terminated by notice to the
Sellers as follows:
(a) at any time prior to the Closing Date or the obligations of
the Underwriters to purchase the Option Shares at any time prior to the
Option Closing Date, as the case may be, if
21
(A) any domestic or international event or act or occurrence has
materially disrupted, or in your opinion will in the immediate future
materially disrupt, the market for the Company's securities or securities
in general; or (B) if trading on the New York Stock Exchange or on the
Nasdaq National Market shall have been suspended, or minimum or maximum
prices for trading shall have been fixed, or maximum ranges for prices for
securities shall have been required, on the New York Stock Exchange or on
the Nasdaq National Market by the New York Stock Exchange or by the Nasdaq
National Market or by order of the Commission or any other governmental
authority having jurisdiction; or (C) if a banking moratorium has been
declared by any state or federal authority or if any material disruption in
commercial banking or securities settlement or clearance services shall
have occurred; or (D) any downgrading shall have occurred in the Company's
corporate credit rating or the rating accorded the Company's debt
securities by any "nationally recognized statistical rating organization"
as that term is defined by the Commission for purposes of Rule 436(g)(2)
under the Act or if any such organization shall have publicly announced
that it has under surveillance or review, with possible negative
implications, its rating of any of the Company's debt securities; or (E)
(i) if there shall have occurred any outbreak or escalation of hostilities
or acts of terrorism involving the United States or there is a declaration
of a national emergency or war by the United States or (ii) if there shall
have been any other calamity or crisis or any change in political,
financial or economic conditions if the effect of any such event in (i) or
(ii) as in your judgment makes it impracticable or inadvisable to proceed
with the offering, sale and delivery of the Underwritten Shares or the
Option Shares, as the case may be, on the terms and in the manner
contemplated by the Prospectus; or (F) since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, any Material Adverse Change has occurred which would, in your
reasonable judgment, materially make it impracticable to market the Shares
in the manner contemplated by the Prospectus, or (G) the enactment,
publication, decree or other promulgation of any federal or state statute,
regulation, rule or order of any court or other governmental authority
which in your reasonable opinion materially and adversely affects or will
materially or adversely affect the business or operations of the Company;
or
(b) as provided in Sections 6 and 10 of this Agreement.
13. Information Furnished by Underwriters. The information set forth in the
Prospectus: (a) in the final paragraph on the cover page, (b) in the table under
the caption "Underwriting" on page ___, listing the Underwriters and the number
of shares each has agreed to purchase, (b) in the fifth paragraph under the
caption "Underwriting," relating to the concession to dealers and the
re-allowance to certain other dealers and the delivery of the Shares, (d) in the
eighth paragraph under the caption "Underwriting," relating to penalty bids, and
(e) in ninth paragraph under the caption "Underwriting," relating to
stabilization activities, constitute the written information furnished by or on
behalf of any Underwriters referred to in paragraph (a) (v) of Section 1 hereof
and in paragraphs (a) and (c) of Section 8 hereof.
14. Successors. This Agreement has been and is made solely for the benefit
of the Underwriters, the Company, the Selling Stockholders and their respective
successors, executors, administrators, heirs, and assigns, and the officers,
directors and controlling persons referred to herein, and no other person will
have any right or obligation hereunder. The term "successors" shall not include
any purchaser of the Shares merely because of such purchase.
15. Miscellaneous. The Representatives will act for the several
Underwriters in connection with this offering, and any action under this
Agreement taken by the Representatives jointly or by ▇▇▇▇▇▇▇▇ Inc. will be
binding upon all of the Underwriters.
22
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
This Agreement shall be governed by, and construed in accordance with,
the laws of the State of Arkansas, without giving effect to the choice of law or
conflict of law principles thereof.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company, the Selling
Stockholders and the several Underwriters in accordance with its terms.
Very truly yours,
▇.▇.▇. TRANSPORTATION SERVICES, INC.
By:
--------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President and Chief Executive Officer
SELLING STOCKHOLDERS
By:
--------------------------------------------
Attorney-in-Fact for the Selling Stockholders
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
▇▇▇▇▇▇▇▇ INC., BB&T CAPITAL MARKETS
and ▇.▇. ▇▇▇▇▇▇▇ & SONS, INC.
By:
--------------------------------------------------
▇▇▇▇▇▇▇▇ Inc., Senior Manager
By: W. ▇▇▇▇▇ ▇▇▇▇▇
Head of Syndicate and Capital Markets
As Representatives of the several Underwriters
named in Schedule II hereto
23
SCHEDULE I
Seller No. of Underwritten Shares
------ --------------------------
▇.▇.▇. Transportation Services, Inc. 2,100,000
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 1,200,000
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 50,000
W. ▇▇▇▇ ▇▇▇▇▇▇ 30,000
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ 20,000
▇▇▇▇▇ ▇▇▇▇▇▇ 75,000
--------
Total 3,475,000
=========
24
SCHEDULE II
Name No. of Underwritten Shares
---- --------------------------
▇▇▇▇▇▇▇▇ Inc.
BB&T Capital Markets
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc.
---------
Total 3,475,000
=========
25
EXHIBIT A
_______________, 2002
▇▇▇▇▇▇▇▇ Inc., BB&T Capital Markets, and
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc., as Representatives of the Several Underwriters
c/o Stephens Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Agreement Not to Sell ▇.▇.▇. Transportation Services, Inc. Stock
------------------------------------------------
Ladies and Gentlemen:
This letter is provided, at the request of ▇.▇.▇. Transportation
Services, Inc. (the "Company"), for the benefit of the Company and the
Underwriters in connection with the proposed public offering of 3,475,000 shares
of ▇.▇.▇. Transportation Services, Inc. Common Stock (plus an additional 521,250
shares if the Underwriters choose to exercise their over-allotment option)
pursuant to a Registration Statement on Form S-2 (File No. 333-83084). As an
inducement to the Underwriters to (a) enter into an Underwriting Agreement with
the Company and (b) consummate the transactions contemplated in such
Underwriting Agreement, the undersigned hereby represents and agrees as follows:
1. Upon the closing of the Company's public offering, the undersigned will
beneficially own the number of shares of the Company's Common Stock set forth
below opposite the signature of the undersigned (the "Shares"), and no others.
2. The undersigned agrees that, for a period of 90 days from the effective
date of the Registration Statement, except for bona fide gifts to persons who
agree with you in writing to be bound by this letter, the undersigned will not
offer, sell or otherwise dispose of any of the Shares, directly or indirectly,
without written consent of ▇▇▇▇▇▇▇▇ Inc., on behalf of the Representatives of
the Underwriters, which consent will not be unreasonably withheld; except that
(a) such Shares may be pledged as collateral against loans of the undersigned
without such written consent, and (b) if loans secured by Shares are called, the
undersigned and any applicable pledgee will have the right to sell the shares
pledged on such loans to the extent necessary to satisfy such loans.
Shares of Common Stock: Very truly yours,
----------------------- --------------------------------
26