Exhibit 1
3,400,000 SHARES OF COMMON STOCK
▇▇▇▇▇▇ PRODUCTS LTD.
UNDERWRITING AGREEMENT
_____________, 1996
BLACK & COMPANY, INC. as the
Representative of the several Underwriters
One S.W. Columbia Street, Suite 1200
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
▇▇▇▇▇▇ Products Ltd., a corporation organized under the laws of the State
of Delaware (the "Company"), and Saugatuck Capital Company Limited Partnership
(the "Selling Shareholder") propose to sell to the several underwriters named in
Schedule A annexed hereto (the "Underwriters"), for whom Black & Company, Inc.
(the "Representative") is acting as the representative an aggregate of 3,400,000
shares (the "Firm Shares") of the Company's Common Stock, $0.10 par value
("Common Stock"), of which 1,500,000 are to be issued and sold by the Company
and 1,900,000 previously issued shares are to be sold by the Selling
Shareholder. In addition, solely for the purposes of covering overallotments,
the Company proposes to grant to the Underwriters an option to purchase up to
510,000 additional shares of Common Stock (the "Option Shares"), as provided in
Section 3 hereof. The Firm Shares and, to the extent such option is exercised,
the Option Shares are hereinafter collectively referred to as the "Shares." The
Representative has advised the Company and the Selling Shareholder that the
Underwriters propose to make a public offering of their respective portions of
the Shares on the effective date of the registration statement hereinafter
referred to, or as soon thereafter as in the Representative's judgment is
advisable.
The Company and the Selling Shareholder hereby confirm their agreements
with respect to the purchase of the Shares by the Underwriters as follows:
SECTION 1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
1.1. The Company represents and warrants to the several Underwriters
that:
1.1.1. The Company has prepared and filed with the Securities
and Exchange Commission (the "Commission") a registration statement on Form
S-2 (File No. 33-13177) with respect to the Shares and a related
preliminary prospectus in conformity with the requirements of the
Securities Act of 1933, as amended (the "Act") and the rules and
regulations of the Commission thereunder (the "Rules and Regulations").
The term "Registration Statement" as used in this Agreement will mean such
registration statement, as amended, including the information (if any)
deemed to be part thereof pursuant to Rule 430A. The term "Prospectus" as
used in this Agreement will mean the form of prospectus first filed by the
Company with the Commission pursuant to Rule 424(b) and Rule 430A. The
terms Registration Statement and Prospectus also include any documents
incorporated therein by reference. Each preliminary prospectus included in
the Registration Statement prior to the time it became effective or filed
______________________
* Plus up to 510,000 shares to cover over-allotments, if any.
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with the Commission pursuant to Rule 424(a) is referred to in this
Agreement as a "Preliminary Prospectus." The Registration Statement has
been declared effective under the Act. There have been delivered to the
Representative two signed copies of such registration statement and
amendments, together with two copies of each exhibit filed therewith.
Conformed copies of such registration statement and amendments (but without
exhibits) and of the related preliminary prospectus have been delivered to
the Representative in such quantities as it has reasonably requested for
each of the Underwriters. The Company will file with the Commission a
final prospectus in accordance with Rule 424(b) and Rule 430A of the Rules
and Regulations.
1.1.2. No stop order suspending the effectiveness of the
Registration Statement has been issued by the Commission and, to the
Company's knowledge, no proceeding for that purpose has been instituted or
threatened by the Commission. No order preventing or suspending the use of
any Preliminary Prospectus has been issued by the Commission, and each
Preliminary Prospectus has conformed in all material respects to the
requirements of the Act and the Rules and Regulations and, as of its date,
did not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading. At the time the Registration Statement became
effective, and at all times subsequent thereto up to and including the
Closing Date and the Option Closing Date hereinafter mentioned, the
Registration Statement and the Prospectus, and any amendments or
supplements thereto, contained and will contain all material statements and
information required to be included therein by the Act and the Rules and
Regulations and will in all material respects conform to the requirements
of the Act and the Rules and Regulations, and neither the Registration
Statement nor any amendment or supplement thereto will contain any untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading, and neither the Prospectus nor any amendment or supplement
thereto will contain any 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, in light of the circumstances under which they were
made, not misleading. Notwithstanding the foregoing, the Company makes no
representation or warranty as to information contained in or omitted from
any Preliminary Prospectus, the Registration Statement, 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, directly or through the Representative, or written information
furnished to the Company by or on behalf of the Selling Shareholder, in
each case, specifically for use in the preparation thereof.
1.1.3. The Company has been duly incorporated and is a validly
existing corporation under the laws of the State of Delaware. The Company
has full corporate power and authority (corporate and other) to own and
lease properties and conduct business as described in the Prospectus. The
Company is in possession of and operating in compliance in all material
respects with all authorizations, licenses, permits, consents, certificates
and orders material to the conduct of its business, all of which are valid
and in full force and effect; the Company is duly qualified to do business
and is in good standing as a foreign corporation in each jurisdiction in
which the ownership or leasing of properties or the conduct of its business
requires such qualification, except for jurisdictions in which the failure
to so qualify would not have a material adverse effect on the Company; and
no proceeding has been instituted in any such jurisdiction, revoking,
limiting or curtailing, or seeking to revoke, limit or curtail, such power
and authority or qualification. Except as set forth in the Prospectus, the
Company does not own or control, directly or indirectly, any corporation,
association or other entity.
1.1.4. The Company's authorized and outstanding capital stock
is as set forth under the heading "Description of Capital Stock" in the
Prospectus. The issued and outstanding shares of Common Stock have been
duly authorized, are validly issued and are fully paid and nonassessable.
All offers and sales by the Company of outstanding shares of capital stock
and other securities of the Company, prior to the date hereof, were made in
compliance with all applicable federal and state securities laws, were not
issued in violation of or subject to any preemptive rights or other rights
to subscribe for or purchase securities, and conform to the description
thereof contained in the Prospectus. Except as disclosed in or
contemplated by the Prospectus and the financial statements of the Company
and the related notes thereto included in the Prospectus, the Company does
not have outstanding any options to purchase, or any
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preemptive rights or other rights to subscribe for or to purchase, any
securities or obligations convertible into, or any contracts or commitments
to issue or sell, shares of its capital stock or any such options, rights,
convertible securities or obligations. The description of the Company's
stock option, stock bonus and other stock plans or arrangements, and the
options or other rights granted and exercised thereunder, set forth in the
Prospectus, accurately and fairly presents the information required to be
shown with respect to such plans, arrangements, options and rights.
1.1.5. The Shares to be sold to the Underwriters pursuant to
this Agreement have been duly authorized and, when issued, delivered and
paid for as contemplated herein, will be duly authorized, validly issued,
fully paid and nonassessable, and will conform to the description thereof
contained in the Prospectus. Except as described in the Prospectus, there
are no restrictions upon the voting or transfer of, any shares of capital
stock of the Company pursuant to the Company's Certificate of
Incorporation, By-Laws or any agreement or instrument to which the Company
is a party or by which the Company is bound. No shareholder of the Company
has any right which has not been waived to require the Company to register
the sale of any shares owned by such shareholder under the Act in the
public offering contemplated by this Agreement. No further approval or
authority of the shareholders or the Board of Directors of the Company will
be required for the issuance and sale of the Shares to be sold to the
Underwriters as contemplated herein.
1.1.6. The Company has full legal right, power and authority
to enter into this Agreement and to perform the transactions contemplated
hereby. This Agreement has been duly authorized, executed and delivered by
the Company and constitutes a valid and binding obligation of the Company
enforceable in accordance with its terms, except (i) as enforceability may
be limited by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other similar laws relating to or affecting
the enforcement of creditors' rights generally or by general equitable
principles, and (ii) to the extent that rights of indemnity or contribution
under this Agreement may be limited by federal and state securities laws or
the public policies underlying such laws. The making and performance of
this Agreement by the Company and the consummation of the transactions
herein contemplated will not violate any provisions of the Certificate of
Incorporation or By-Laws, or other organizational documents of the Company,
and will not conflict with, result in the breach or violation of, or
constitute, either by itself or upon notice or the passage of time or both,
a default under any agreement, mortgage, deed of trust, lease, franchise,
license, indenture, permit or other instrument to which the Company is a
party or by which the Company or its properties may be bound or affected,
any statute or any authorization, judgment, decree, order, rule or
regulation of any court or any regulatory body, administrative agency or
other governmental body applicable to the Company or any of its properties.
No consent, approval, authorization or other order of any court, regulatory
body, administrative agency or other governmental body is required for the
execution and delivery of this Agreement or the consummation of the
transactions contemplated by this Agreement, except for compliance with the
Act, the Blue Sky laws applicable to the public offering of the Shares by
the several Underwriters and the clearance of such offering with the
National Association of Securities Dealers, Inc. (the "NASD").
1.1.7. Price Waterhouse LLP and Kraft Bros., Esstman, ▇▇▇▇▇▇ &
▇▇▇▇▇▇▇ PLLC, who have expressed their opinion with respect to the
financial statements of the Company and Tennessee Building Products, Inc.
("TBP"), respectively, filed with the Commission as a part of the
Registration Statement and included in the Prospectus and in the
Registration Statement, are independent accountants as required by the Act
and the Rules and Regulations.
1.1.8. The financial statements of the Company and TBP and the
related notes thereto included in the Registration Statement and the
Prospectus present fairly the financial position, results of operations,
cash flows and changes in shareholders' equity of the Company as of the
respective dates and for the periods indicated in such financial
statements. Such financial statements and related notes have been prepared
in accordance with generally accepted accounting principles applied on a
consistent basis. No other financial statements or schedules are required
to be included in the Registration Statement. The summary financial data
set forth in the Prospectus under the caption "Summary Financial Data"
fairly presents the information set forth therein on the basis stated in
the Registration Statement.
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1.1.9. The Company is not (i) in violation or default of any
provision of its Restated Certificate of Incorporation or By-Laws, each as
amended, or (ii) in breach of or in default with respect to any provision
of any agreement, judgment, decree, order, mortgage, deed of trust, lease,
franchise, license, indenture, permit or other instrument to which it is a
party or by which it or any of its properties are bound. To the Company's
knowledge, there does not exist any state of facts which constitutes an
event of default on the part of the Company as defined in such documents or
which, with notice or lapse of time or both, would constitute such an event
of default.
1.1.10. There are no actions, suits or proceedings pending
before any court or administrative or regulatory agency or, to the best of
the Company's knowledge, threatened by any party which if determined
adversely to the Company would, individually or in the aggregate result in
a material adverse change in the condition (financial or other),
properties, business, results of operations or prospects of the Company or
prevent or adversely affect the transactions contemplated by this
Agreement. No labor disturbance by the employees of the Company exists or
is imminent which might be expected to affect adversely the condition
(financial or other), properties, business, results of operations or
prospects of the Company. The Company is not a party to or subject to the
provisions of any material injunction, judgment, decree or order of any
court, regulatory body, administrative agency or other governmental body.
1.1.11. The Company has good and marketable title to all the
properties and assets reflected as owned in the financial statements
hereinabove described (or elsewhere in the Prospectus), subject to no lien,
mortgage, pledge, charge or encumbrance of any kind except (i) those, if
any, reflected in such financial statements (or elsewhere in the
Prospectus), or (ii) those which are not material in amount and do not
adversely affect the use made and proposed to be made of such property by
the Company. The Company holds its leased properties under valid and
binding leases, with such exceptions as are not materially significant in
relation to the business of the Company. Except as disclosed in the
Prospectus, the Company owns or leases all such properties as are necessary
to its operations as now conducted.
1.1.12. There are no contracts or other documents required to
be described in the Registration Statement or filed as exhibits to the
Registration Statement by the Act or by the Rules and Regulations which
have not been described or filed as required. The contracts so described
in the Prospectus or filed as exhibits to the Registration Statement are,
except as otherwise provided in the Registration Statement, in full force
and effect on the date hereof, and neither the Company, nor to the best of
the Company's knowledge, any other party is in breach of or in default
under any of such contracts except where such breach or default would not
materially adversely affect the Company.
1.1.13. Since the respective dates as of which information is
given in the Registration Statement and Prospectus, and except as described
in or specifically contemplated by the Prospectus: (i) the Company has not
incurred any material liabilities or obligations, indirect, direct or
contingent, or entered into any material verbal or written agreement or
other transaction which is not in the ordinary course of business or which
could result in a material reduction in the future earnings of the Company;
(ii) the Company has not sustained any material loss or interference with
its businesses or properties from fire, flood, windstorm, accident or other
calamity, whether or not covered by insurance; (iii) the Company has not
paid or declared any dividends or other distributions with respect to its
capital stock and the Company is not in default in the payment of principal
or interest on any outstanding debt obligations; (iv) there has not been
any change in the capital stock (other than upon the sale of the Shares
hereunder) or indebtedness material to the Company (other than in the
ordinary course of business); and (v) there has not been any material
adverse change in the condition (financial or other), business, properties,
results of operations, management or prospects of the Company.
1.1.14. Except as disclosed in or specifically contemplated by
the Prospectus, the Company owns or licenses all trademarks, trade names,
patent rights, copyrights, licenses, approvals and governmental
authorizations necessary to conduct its businesses as now conducted. The
Company has no knowledge of any material infringement by it of any
trademarks, trade name rights, patent rights, copyrights, licenses, trade
secrets or other similar rights of others, and there is no claim being made
or
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threatened against the Company regarding trademark, trade name, patent,
copyright, license, trade secret or other infringement which could have a
material adverse effect on the condition (financial or other), business,
results of operations or prospects of the Company.
1.1.15. The Company is conducting its business in compliance
with all applicable laws, rules and regulations of the jurisdictions in
which it is conducting business, including, without limitation, all
applicable local, state and federal environmental laws and regulations,
except where failure to be so in compliance would not materially adversely
affect the condition (financial or other), business, results of operations
or prospects of the Company.
1.1.16. The Company has filed all necessary federal, state and
foreign income, excise and franchise tax returns and has paid all taxes
shown as due thereon. The Company has no knowledge of any tax deficiency
which has been or might be asserted or threatened against the Company which
could materially and adversely affect the business, results of operations
or properties of the Company.
1.1.17. The Company maintains insurance of the types and in the
amounts generally deemed adequate for its business, including, without
limitation, insurance covering 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.
1.1.18. The Company is not an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
1.1.19. The Company has not distributed and will not distribute
prior to the Closing Date any offering material in connection with the
offering and sale of the Shares other than the Prospectus, the Registration
Statement and the other materials permitted by the Act.
1.1.20. The Company has not at any time during the last five
years (i) made any unlawful contribution to any candidate for foreign
office, or failed to disclose fully any contribution in violation of law,
or (ii) made any payment to any federal or state governmental officer or
official, or any 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.
1.1.21. The Company maintains a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions
are executed in accordance with management's general or specific
authorization, (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets,
(iii) access to records is permitted only in accordance with management's
general or specific authorization, and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
1.1.22. The Company has not taken and will not take, directly
or indirectly, any action designed to or that might be reasonably expected
to cause or result in stabilization or manipulation of the price of the
Common Stock to facilitate the sale or resale of the Shares.
1.1.23. The Company has obtained and delivered to the
Representative written agreements (the "Lock-Up Agreements"), in form and
substance satisfactory to the Representative, of the Selling Shareholder
and the Company's officers and directors that no offer, sale, assignment,
transfer, encumbrance, contract to sell, grant of an option to purchase or
other disposition of any Common Stock or other capital stock of the Company
will be made for a period of 180 days after the effective date of the
Registration, directly or indirectly, by the Company or such officer,
director or other shareholder except as provided by such written
agreements.
1.1.24. Other than as contemplated by this Agreement or as
disclosed in the underwriting section of the Registration Statement, the
Company has not incurred any liability for any finder's or
5
broker's fee or agent's commission in connection with the execution and
delivery of this Agreement or the consummation of the transactions
contemplated hereby or engaged in any other transactions or entered into
any other agreement or understanding which might otherwise be considered by
the NASD in determining the reasonableness of the compensation to be
received by the Underwriters under this Agreement.
1.1.25. The Common Stock is registered pursuant to Section
12(b) of the Securities Exchange Act of 1934, as amended, (the "Exchange
Act").
1.1.26. The Company has been subject to the requirements of
Section 12 or 15(d) of the Exchange Act and has filed all the material
required to be filed pursuant to Sections 13, 14 or 15(d) for a period of
at least thirty-six calendar months immediately preceding the filing of the
Registration Statement and has filed in a timely manner all reports
required to be filed during the twelve calendar months and any portion of
the month immediately preceding the filing of the Registration Statement
and, if the Company has used Rule 12b-25(b) under the Exchange Act with
respect to a report or a portion of a report, that report or portion
thereof has actually been filed within the time period prescribed by that
rule.
1.1.27. The Company has not, since the end of its last fiscal
year for which certified financial statements of the Company were included
in a report filed pursuant to Section 13(a) or 15(d) of the Exchange Act:
(a) failed to pay any dividend or sinking fund installment on preferred
stock; or (b) defaulted (i) on any installment or installments on
indebtedness for borrowed money, or (ii) on any rental on one or more long
term leases, which defaults in the aggregate are material to the financial
position of the Company.
1.2. The Selling Shareholder represents and warrants to the several
Underwriters that:
1.2.1 The Selling Shareholder, having full legal right, power
and authority to do so, has duly executed and delivered a power of attorney
in the form previously provided to the Representative, (the "Power of
Attorney") appointing ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, and each
of them acting independently, as the Selling Shareholder's attorney-in-fact
(the "Attorneys-in-Fact"), and has delivered to the Attorneys-in-Fact one
or more stock certificates representing the Firm Shares being offered and
sold by the Selling Shareholder to the Underwriters pursuant to this
Agreement together with a blank stock power with respect to such shares.
Collectively such documents are referred to herein as the "Selling
Shareholder Documents." Each of the Selling Shareholder Documents is a
valid and binding obligation of the Selling Shareholder enforceable in
accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
or other similar laws relating to or affecting the enforcement of
creditors' rights generally or by general equitable principles.
1.2.2 The Selling Shareholder, having full legal right, power
and authority to do so, has, either directly or through the
Attorneys-in-Fact, duly executed and hereby delivers to the Representative
this Agreement. This Agreement constitutes a valid and binding obligation
of the Selling Shareholder enforceable in accordance with its terms, except
(i) as enforceability may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or other similar laws relating to or
affecting the enforcement of creditors' rights generally or by general
equitable principles, and (ii) to the extent that rights of indemnity or
contribution under this Agreement may be limited by federal and state
securities laws or the public policies underlying such laws. The making
and performance of this Agreement by the Selling Shareholder and the
consummation of the transactions herein contemplated will not violate any
provisions of the organizational documents of the Selling Shareholder and
will not conflict with, result in the breach or violation of, or
constitute, either by itself or upon notice or the passage of time or both,
a default under any agreement, mortgage, deed of trust, lease, franchise,
license, indenture, permit or other instrument to which the Selling
Shareholder is a party or by which the Selling Shareholder or the Firm
Shares being offered and sold by the Selling Shareholder may be bound or
affected, any statute or any authorization, judgment, decree, order, rule
or regulation of any court or any regulatory body, administrative agency or
other governmental body applicable to the Selling Shareholder or the Firm
Shares being offered and sold by the Selling Shareholder. No consent,
approval, authorization or other order of any court, regulatory body,
administrative agency or other governmental body is required for the
execution
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and delivery of this Agreement or the consummation of the transactions
contemplated by this Agreement, except for compliance with the Act, the
Blue Sky laws applicable to the public offering of the Shares by the
several Underwriters and the clearance of such offering with the NASD.
1.2.3. The Selling Shareholder has and, at all times until and
through the Closing Date, will have good, valid and marketable title to the
Firm Shares being offered and sold by the Selling Shareholder, free and
clear of all liens, encumbrances, equities, security interests and claims
and full right, power and authority to sell, assign, transfer and deliver
such shares pursuant to this Agreement. When the Firm Shares being offered
and sold by the Selling Shareholder are paid for in accordance with the
terms stated in this Agreement, good, valid and marketable title to the
Firm Shares being offered and sold by the Selling Shareholder will be
transferred to the Underwriters free and clear of all liens, encumbrances,
equities, security interests and claims.
1.2.4 The Selling Shareholder acknowledges and agrees that
the shares represented by the certificates on deposit with the
Attorneys-in-Fact are subject to the interests of the Underwriters
hereunder, that the arrangements made for such custody and the appointment
of the Attorneys-in-Fact are to that extent irrevocable, and that the
obligation of the Selling Shareholder hereunder may not be terminated,
except as provided in this Agreement or the Power of Attorney, by any act
of the Selling Shareholder, by operation of law or otherwise, or by the
occurrence of any other event.
1.2.5 All information furnished to the Company by or on
behalf of the Selling Shareholder for use in connection with the
preparation of the Registration Statement was and will be true and correct
in all material respects as of the date of the Power of Attorney, on the
effective date of the Registration Statement and on the Closing Date and
the Option Closing Date and does not and will not contain any untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading. Without
limiting the foregoing, the Selling Shareholder has no knowledge which
would cause it to believe that the Registration Statement or the Prospectus
contains any untrue statement of a material fact or omits to state a
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. The Selling Shareholder acknowledges and agrees that
it will notify promptly the Representative and the Company in writing of
any information the effect of which would render inaccurate any of the
representations and warranties contained in this Section 1.2.
1.2.6. The Selling Shareholder has not distributed and will
not distribute prior to the Closing Date any offering material in
connection with the offering and sale of the Shares other than the
Prospectus, the Registration Statement and the other materials permitted by
the Act.
1.2.7. The Selling Shareholder has not taken and will not
take, directly or indirectly, any action designed to or that might be
reasonably expected to cause or result in stabilization or manipulation of
the price of the Common Stock to facilitate the sale or resale of the
Shares.
1.2.8. Neither the Selling Shareholder nor, to the best of the
Selling Shareholder's knowledge, any associate of the Selling Shareholder
is affiliated with any firm directly or indirectly engaged in the
securities business as a broker or dealer, as an employee of such a firm
acting in any capacity including as an officer or registered
representative, as a director or a partner of such a firm or as an equity
investor or debt investor in such firm (other than debt arising as a result
of trading activities and other than investments in publicly held firms
where such equity or debt investment does not exceed five percent of the
outstanding securities of such class issued by the firm).
1.2.9. The Selling Shareholder has executed and delivered to
the Representative a Lock-Up Agreement, in form and substance satisfactory
to the Representative, that no offer, sale, assignment, transfer,
encumbrance, contract to sell, grant of an option to purchase or other
disposition of any Common Stock or other capital stock of the Company will
be made for a period of 180 days after the
7
effective date of the Registration Statement, directly or indirectly, by
the Selling Shareholder except as provided by such written agreement.
1.2.10. Other than as contemplated by this Agreement or as
disclosed in the underwriting section of the Registration Statement, the
Selling Shareholder has not incurred any liability for any finder's or
broker's fee or agent's commission in connection with the execution and
delivery of this Agreement or the consummation of the transactions
contemplated hereby or engaged in any other transactions or entered into
any other agreement or understanding which might otherwise be considered by
the NASD in determining the reasonableness of the compensation to be
received by the Underwriters under this Agreement.
SECTION 2. REPRESENTATIONS AND WARRANTIES OF THE UNDERWRITERS. The
Representative, on behalf of the several Underwriters, represents and warrants
to the Company and the Selling Shareholder that the information set forth (i) on
the cover page of the Prospectus with respect to price, underwriting discounts
and commissions and terms of offering, and (ii) under "Underwriting" in the
Prospectus was furnished to the Company by and on behalf of the Underwriters for
use in connection with the preparation of the Registration Statement and the
Prospectus and is correct in all material respects. The Representative
represents and warrants that it has been authorized by each of the other
Underwriters to enter into this Agreement on its behalf and to act as its
Representative in the manner herein provided.
SECTION 3. PURCHASE, SALE AND DELIVERY OF SHARES.
3.1. On the basis of the representations, warranties and agreements
herein contained, but subject to the terms and conditions herein set forth, the
Company agrees to sell to the Underwriters 1,500,000 of the Firm Shares and the
Selling Shareholder agrees to offer and sell 1,900,000 of the Firm Shares. The
Underwriters, severally and not jointly, agree to purchase from the Company and
the Selling Shareholder the number of Firm Shares set forth opposite the name of
such Underwriter in Schedule A hereto. The number of Firm Shares to be
purchased by each Underwriter from the Company will bear the same ratio to the
total number of Firm Shares to be sold by the Company as the total number of
Firm Shares to be purchased by such Underwriter bears to the total number of
Firm Shares to be purchased by all of the Underwriters, collectively and the
number of Firm Shares to be purchased by each Underwriter from the Selling
Shareholder will bear the same ratio to the total number of Firm Shares to be
sold by the Selling Shareholder as the total number of Firm Shares to be
purchased by such Underwriter bears to the total number of Firm Shares to be
purchased by all of the Underwriters, collectively; provided, however, that the
Representative may on behalf of the Underwriters adjust the number of Firm
Shares to be purchased by each Underwriter from the Selling Shareholder so as to
eliminate fractional shares. The purchase price per share to be paid by the
several Underwriters to the Company and the Selling Shareholder will be
$__________ per share.
3.2. Delivery of certificates for the Firm Shares to be purchased by
the Underwriters and payment therefor will be made at the offices of Black &
Company, Inc., located at One ▇.▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
(or such other place as may be agreed upon by the Company, the Selling
Shareholder and the Representative) at such time and date, not later than the
second full business day following the first date that any of the Shares are
released by the Representative for sale to the public, as designated by the
Representative with at least 48 hours' prior notice to the Company and the
Selling Shareholder (or at such other time and date, not later than one week
after such second full business day as may be agreed upon by the Company, the
Selling Shareholder and the Representative) (the "Closing Date"); provided,
however, that if the Prospectus is at any time prior to the Closing Date
recirculated to the public, the Closing Date will occur upon the later of the
second full business day following the first date that any of the Shares are
released by the Representative for sale to the public or the date that is 48
hours after the date that the Prospectus has been so recirculated. As used
herein "business day" shall mean a day on which the New York Stock Exchange is
open for trading.
Delivery of certificates for the Firm Shares will be made by or on behalf
of the Company and the Selling Shareholder to the Representative, for the
respective accounts of the Underwriters against payment by the Representative,
for the accounts of the several Underwriters, of the purchase price therefor by
certified or official bank checks payable in next day funds to the order of the
Company or the Selling Shareholder, as the case may be.
8
The certificates for the Firm Shares will be registered in such names and
denominations as requested by the Representative at least one full business days
prior to the Closing Date, and will be made available for checking and packaging
on the business day preceding the Closing Date at a location in New York, New
York, as may be designated by the Representative. Time is of the essence, and
delivery at the time and place specified in this Agreement is a further
condition to the obligations of the Underwriters.
3.3. In addition, on the basis of the representations, warranties and
agreements herein contained, but subject to the terms and conditions herein set
forth, the Company hereby grants an option to the several Underwriters to
purchase, severally and not jointly, up to an aggregate of 510,000 Option Shares
at the purchase price per share to be paid for the Firm Shares, for use solely
in covering any over-allotments made by the Representative for the account of
the Underwriters in the sale and distribution of the Firm Shares. The option
granted hereunder may be exercised at any time (but not more than once) within
30 days after the first date that any of the Shares are released by the
Representative for sale to the public, upon notice by the Representative to the
Company setting forth the aggregate number of Option Shares as to which the
Underwriters are exercising the option, the names and denominations in which the
Certificates for such shares are to be registered, and the time and place at
which such certificates will be delivered. Such time of delivery (which may not
be earlier than the Closing Date), being herein referred to as the "Option
Closing Date," will be determined by the Representative, but if at any time
other than the Closing Date will not be earlier than two nor later than five
full business days after delivery of such notice of exercise. The number of
Option Shares to be purchased by each Underwriter will be determined by
multiplying the number of Option Shares to be sold by the Company pursuant to
such notice of exercise by a fraction, the numerator of which is the number of
Firm Shares to be purchased by such Underwriter as set forth opposite its name
in Schedule A and the denominator of which is 3,400,000 (subject to such
adjustments to eliminate any fractional share purchases as the Representative in
its discretion may make). Certificates for the Option Shares will be made
available for checking and packaging on the business day preceding the Option
Closing Date at a location in New York, New York, as may be designated by the
Representative. The manner of payment for and delivery of the Option Shares
will be the same as for the Firm Shares purchased from the Company as specified
in Section 3.2. At any time before lapse of the option, the Representative may
cancel such option by giving written notice of such cancellation to the Company.
If the option is cancelled or expires unexercised in whole or in part, the
Company will deregister under the Act the number of Option Shares as to which
the option has not been exercised.
3.4. The Representative has advised the Company and the Selling
Shareholder that each Underwriter has authorized the Representative to accept
delivery of its Shares and to make payment and receipt therefor.
3.5. Subject to the terms and conditions hereof, the Underwriters
propose to make a public offering of their respective portions of the Shares as
soon after the effective date of the Registration Statement as in the judgment
of the Representative is advisable and at the public offering price set forth on
the cover page of and on the terms set forth in the Prospectus. The
Representative may release the Firm Shares for public sale promptly after this
Agreement becomes effective. The Underwriters may then, from time to time,
increase or decrease the public offering price after the initial public offering
to such extent they may determine.
9
SECTION 4. COVENANTS OF THE COMPANY AND THE SELLING SHAREHOLDER.
4.1. The Company covenants and agrees that:
4.1.1. The Company will prepare and, within the time period
prescribed, file with the Commission under Rule 424(b) under the Act a
Prospectus containing information previously omitted at the time of
effectiveness of the Registration Statement in reliance on Rule 430A under
the Act and will provide evidence satisfactory to the Representative of
such timely filing. The Company will fully and completely comply with the
provisions of Rule 430A of the Rules and Regulations with respect to
information omitted from the Registration Statement in reliance upon such
rule. The Company will not file any amendment to the Registration
Statement or supplement to the Prospectus of which the Representative has
not previously been advised and furnished with a copy or as to which the
Representative has objected in writing promptly after reasonable notice
thereof or which is not in compliance with the Act or the Rules and
Regulations. The Company will promptly advise the Representative in
writing (i) of the receipt of any comments of the Commission, (ii) of any
request of the Commission for amendment of or supplement to the
Registration Statement, any Preliminary Prospectus or the Prospectus or for
additional information, (iii) when any amendment to the Registration
Statement becomes effective, and (iv) of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement
or of the institution of any proceedings for that purpose. If the
Commission enters any such stop order at any time, the Company will use its
best efforts to obtain the lifting of such order at the earliest possible
moment.
4.1.2. The Company will prepare and file with the Commission,
promptly upon the Representative's request, any amendments or supplements
to the Registration Statement or the Prospectus which in the
Representative's reasonable judgment may be necessary or advisable to
enable the several Underwriters to continue the distribution of the Shares
and will use its best efforts to cause the same to become effective as
promptly as possible.
4.1.3. During such period as a prospectus is required by law
to be delivered in connection with sales by an Underwriter or a dealer, the
Company, at its expense, but only for the nine-month period referred to in
Section 10(a)(3) of the Act, will furnish to the Representative or mail to
its order, copies of the Registration Statement, the Prospectus, the
Preliminary Prospectus and all amendments and supplements to any such
documents in each case as soon as available and in such quantities as the
Representative may reasonably request, for the purposes contemplated by the
Act.
4.1.4. If at any time when a prospectus relating to the Shares
is required to be delivered under the Act, any event occurs, as a result of
which the Prospectus, including any amendments or supplements, would
contain an untrue statement of a material fact, or omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary at any time to amend the
Prospectus, including any amendments or supplements, to comply with the Act
or the Rules and Regulations, the Company will promptly advise the
Representative thereof and will promptly prepare and file with the
Commission, at its own expense, an amendment or supplement which will
correct such statement or omission or an amendment or supplement which will
effect such compliance and will use its best efforts to cause the same to
become effective as soon as possible. In case any Underwriter is required
to deliver a prospectus after such nine-month period, the Company upon
request, but at the expense of such Underwriter, will promptly prepare such
amendment or amendments to the Registration Statement and such Prospectus
or Prospectuses as may be necessary to permit compliance with the
requirements of Section 10(a)(3) of the Act.
4.1.5. As soon as practicable and for the time specified by
Rule 158 of the Rules and Regulations, the Company will make generally
available to its security holders and deliver to the Underwriters an
earnings statement of the Company which will satisfy the provisions of the
last paragraph of Section 11(a) of the Act and Rule 158 of the Rules and
Regulations.
10
4.1.6. The Company will apply the net proceeds of the sale of
the Shares sold by it in accordance with its statements under the caption
"Use of Proceeds" in the Prospectus.
4.1.7. During the period of five years hereafter, the Company
will furnish to the Representative and, upon its request, to each of the
other Underwriters: (i) as soon as practicable after the end of each fiscal
year, copies of the Annual Report of the Company containing the balance
sheet of the Company as of the close of such fiscal year and statements of
income, cash flows and stockholders' equity for the year then ended and the
opinion thereon of the Company's independent public accountants; (ii) as
soon as practicable after the filing thereof, copies of each proxy
statement, Annual Report on Form 10-K, Quarterly Report on Form 10-Q,
Report on Form 8-K or other report filed by the Company with the
Commission, the NASD or any securities exchange; and (iii) as soon as
available, copies of any report or communication of the Company mailed
generally to holders of its Common Stock.
4.1.8. The Company will cooperate with the Representative and
its counsel in order to qualify or register the Shares for sale under (or
obtain exemptions from the application of) the securities laws and
regulations of such states, territories and jurisdictions as the
Representatives designates ("Blue Sky Laws"), will comply with such laws
and will continue such qualifications, registrations and exemptions in
effect so long as required for the distribution of the Shares.
Notwithstanding the foregoing, the Company will not be required to qualify
as a foreign corporation or to file a general consent to service of process
in any such jurisdiction where it is not presently qualified or where it
would be subject to taxation as a foreign corporation. The Company will
promptly advise the Representative of the suspension of the qualification
or registration of (or any such exemption relating to) the Shares for
offering, sale or trading in any jurisdiction or any initiation or threat
of any proceeding for any such purpose, and in the event of the issuance of
any order suspending such qualification, registration or exemption, the
Company, with the Representative's cooperation, will use its best efforts
to obtain the withdrawal thereof.
4.1.9. The Company will not offer, sell, contract to sell,
grant any option to sell, transfer or otherwise dispose of, directly or
indirectly, any shares of Common Stock or securities convertible into or
exchangeable for Common Stock or warrants or other rights to purchase
Common Stock or permit the registration under the Act of any shares of
Common Stock, for a period commencing on the date hereof and continuing for
180 days after the date of the Prospectus, without the prior written
consent of the Representative except for: (i) shares of Common Stock
issued pursuant to the exercise of outstanding options, (ii) the granting
of options to its employees, officers and directors under its existing
stock option plans so long as none of such options becomes exercisable
during such 180 day period, (iii) the sale of shares under the Company's
employee stock purchase plan and (iv) the registration of the Shares and
the sales to the Underwriters pursuant to this Agreement.
4.2. The Selling Shareholder covenants and agrees that:
4.2.1 The Selling Shareholder will not purchase or offer to
buy any shares of Common Stock during the period of 45 days hereafter
without the prior written consent of the Representative.
4.2.2 The Selling Shareholder will promptly advise the
Representative in writing (i) of the receipt of any comments of the
Commission, (ii) of any request of the Commission for amendment of or
supplement to the Registration Statement, any Preliminary Prospectus or the
Prospectus or for additional information, and (iii) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or of the institution of any proceedings for that
purpose. If the Commission enters any such stop order at any time, the
Selling Shareholder will use its best efforts to obtain the lifting of such
order at the earliest possible moment.
4.2.3 The Selling Shareholder will use its best efforts,
including the voting of all Common Stock which it may own, to cause the
Company to carry out its covenants and agreements hereunder.
11
4.2.4. The Selling Shareholder will cooperate with the
Representative and its counsel in order to qualify or register the Shares
for sale under (or obtain exemptions from the application of) the Blue Sky
Laws, will comply with such laws and will continue such qualifications,
registrations and exemptions in effect so long as required for the
distribution of the Shares. The Selling Shareholder will promptly advise
the Representative of the suspension of the qualification or registration
of (or any such exemption relating to) the Shares for offering, sale or
trading in any jurisdiction or any initiation or threat of any proceeding
for any such purpose, and in the event of the issuance of any order
suspending such qualification, registration or exemption, the Selling
Shareholder, with the Representative's cooperation, will use its best
efforts to obtain the withdrawal thereof.
4.3. The Representative may, in its sole discretion, waive in writing
the performance by the Company or the Selling Shareholder of any one or more of
the foregoing covenants or extend the time for their performance.
SECTION 5. COSTS AND EXPENSES. Whether or not the transactions
contemplated hereunder are consummated, the Company will pay (directly or by
reimbursement) all costs, expenses and fees incurred in connection with the
performance of its obligations under this Agreement, including, without limiting
the generality of the foregoing, the following: (i) all accounting fees of the
Company, (ii) the fees and disbursements of counsel for the Company, (iii) the
costs of preparing, printing and filing the Registration Statement, Preliminary
Prospectuses, the Prospectus and any and all amendments and supplements thereto,
(iv) the costs of printing or photocopying and distributing this Agreement, the
Agreement Among Underwriters, any Selected Dealer Agreement, the Underwriters'
Selling Memorandum, the Invitation Letter, the Power of Attorney and any
supplements or amendments thereto (excluding, except as provided below, fees and
expenses of counsel to the Underwriters), (v) filing fees with the Commission,
(vi) filing fees for review by the NASD of the terms of the sale of the Shares,
(vii) all filing fees, attorneys' fees and expenses incurred by the Company or
the Underwriters (including the fees and expenses of Underwriters' counsel) in
connection with qualifying or registering (or obtaining exemptions from the
qualification or registration of) all or any part of the Shares for offer and
sale under the Blue Sky laws, including the preparation and distribution of the
Blue Sky memorandum, (viii) all expenses incident to the issuance and delivery
of the Shares (including all printing and engraving costs), (ix) all fees and
expenses of the registrar and transfer agent of the Common Stock, (x) all
necessary issue, transfer and other stamp taxes in connection with the issuance
and sale of the Shares to the Underwriters, (xi) all expenses relating to
presentations to prospective Underwriters, dealers or investors, excluding only
the Underwriters' out-of-pocket travel and lodging expenses, and (xii) all other
fees, costs and expenses referred to in Item 14 of the Registration Statement.
The Company will not be required to pay any expenses of the Underwriters,
including the fees and disbursements of Underwriters' counsel (excluding those
fees and expenses of Underwriters' counsel relating to qualification,
registration or exemption under the Blue Sky laws and the Blue Sky memorandum
referred to above), except as expressly provided in this Section 5 or otherwise
provided in either Section 7 or Section 8 of this Agreement. The Selling
Shareholder will pay or reimburse the Company for (i) the fees and expenses of
the Attorneys-in-Fact, if any, (ii) all expenses and taxes incident to the sale
and delivery of the Firm Shares being offered and sold by the Selling
Shareholder to the Underwriters, (iii) any additional filing fees and other
expenses of qualification under Blue Sky Laws, the Commission's registration fee
and the NASD's fee for the inclusion of the Firm Shares of the Selling
Shareholder, (iv) any other expenses which the Selling Shareholder is required
to bear or share in under any applicable Blue Sky Laws and (v) any other
expenses which the Selling Shareholder has agreed to pay or reimburse the
Company.
SECTION 6. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the several Underwriters to purchase and pay for the Firm Shares
on the Closing Date and the Option Shares on the Option Closing Date will be
subject to the accuracy of the representations and warranties on the part of the
Company and the Selling Shareholder set forth in this Agreement as of the date
hereof and as of the Closing Date or the Option Closing Date, as the case may
be, to the performance by the Company and the Selling Shareholder of their
obligations hereunder, and to the following additional conditions:
6.1. The Prospectus has been filed with the Commission pursuant to
Rule 424(b) within the time period prescribed for such filing by the Rules and
Regulations and in accordance with Section 4.1 of this Agreement. No stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been initiated or threatened by the
Commission or, to the knowledge of the
12
Company or the Representative, is contemplated by the Commission and all
requests of the Commission for additional information have been complied with to
the Representative's satisfaction.
6.2. The Representative is satisfied that since the respective dates
as of which information is given in the Registration Statement and Prospectus,
(i) there has not been any change in the capital stock of the Company or any
material increase in the indebtedness (other than in the ordinary course of
business) of the Company, (ii) except as set forth in or contemplated by the
Registration Statement or the Prospectus, no material verbal or written
agreement or other transaction has been entered into by the Company which is not
in the ordinary course of business or which could result in a material reduction
in the future earnings of the Company, (iii) no loss or damage (whether or not
insured) to the property of the Company has been sustained which materially and
adversely affects the condition (financial or other), business, results of
operations or prospects of the Company, (iv) no legal or governmental action,
suit or proceeding affecting the Company that is material to the Company or
which materially affects or may materially affect the transactions contemplated
by this Agreement has been instituted or threatened and (v) there has not been
any material change in the condition (financial or other), business, management,
results of operations or prospects of the Company that makes it impractical or
inadvisable in the reasonable judgment of the Representative, to proceed with
the public offering or purchase the Shares as contemplated hereby.
6.3. There has been furnished to the Representative, on each of the
Closing Date and the Option Closing Date, in form and substance satisfactory to
the Representative:
(a) An opinion of Winthrop, Stimson, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, counsel
for the Company and the Selling Shareholder, addressed to the Underwriters
and dated as of the Closing Date, or the Option Closing Date, as the case
may be, to the effect that:
(1) The Company has been duly incorporated and is a validly
existing corporation under the laws of the State of Delaware. The
Company is duly qualified to do business and is in good standing in
all jurisdictions where the ownership or leasing of properties or the
conduct of its business requires such qualification, except for
jurisdictions in which the failure to so qualify would not have a
material adverse effect on the Company, and has full corporate power
and authority to own its properties and conduct its business as
described in the Prospectus.
(2) The Company has authorized and outstanding capital
stock as described in the Prospectus. The outstanding shares of the
Company's capital stock have been duly authorized and validly issued
and are fully paid and nonassessable. The Shares to be issued and
sold to the Underwriters by the Company pursuant to this Agreement
have been duly authorized and, when issued and paid for as
contemplated herein, will be validly issued, fully paid and
nonassessable. None of the outstanding shares of Common Stock have
been, and none of the Shares will be, issued in violation of or
subject to any statutory preemptive rights or, to counsel's actual
knowledge other rights to subscribe for or purchase any securities.
All authorized, issued and outstanding capital stock of the Company
conforms in all material respects to the description thereof under the
caption "Description of Capital Stock" in the Prospectus.
(3) The certificates evidencing the Shares to be delivered
hereunder are in proper legal form and have been duly authorized for
issuance by the Company.
(4) Except as disclosed in or specifically contemplated by
the Prospectus, to counsel's actual knowledge, there are no
outstanding options, warrants or other rights calling for the issuance
of, and no commitments, plans or arrangements to issue any shares of
capital stock of the Company or any security convertible into or
exchangeable for capital stock of the Company.
(5) The Registration Statement has become effective under
the Act, and, to the actual knowledge of such counsel, no stop order
suspending the effectiveness of the
13
Registration Statement or preventing the use of the Prospectus has
been issued and no proceedings for that purpose have been instituted
or are pending or contemplated by the Commission; any required filing
of the Prospectus and any supplement thereto pursuant to Rule 424(b)
of the Rules and Regulations has been made in the manner and within
the time period required by such Rule 424(b).
(6) The Registration Statement, the Prospectus and each
amendment or supplement thereto (except for the financial statements,
financial data and schedules included therein as to which such counsel
need express no opinion) comply as to form in all material respects
with the requirements of the Act and the Rules and Regulations.
(7) To the actual knowledge of such counsel, there are no
franchises, leases, contracts, agreements or documents of a character
required to be disclosed in the Registration Statement or Prospectus
or to be filed as exhibits to the Registration Statement which are not
disclosed or filed, as required.
(8) To the actual knowledge of such counsel, there are no
pending or threatened legal or governmental actions, suits or
proceedings against the Company (including, without limitation, those
having jurisdiction over environmental or similar matters) required to
be disclosed in the Registration Statement or Prospectus which are not
disclosed as required.
(9) The Company has full corporate power and corporate
authority to enter into this Agreement and to sell and deliver the
Shares to be sold by it to the several Underwriters; this Agreement
has been duly and validly authorized by all necessary corporate action
by the Company, has been duly and validly executed and delivered by
and on behalf of the Company, and is a valid and binding agreement of
the Company enforceable in accordance with its terms, except as
enforceability may be limited by (A) bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium or other laws
affecting the enforcement of creditors' rights generally and by
general equitable principles, and (B) to the extent that rights to
indemnity or contribution under this Agreement may be limited by
federal or state securities laws or the public policies underlying
such laws; and no approval, authorization, order, consent,
registration, filing, qualification, license or permit of or with any
court, regulatory, administrative or other governmental body is
required for the execution and delivery of this Agreement by the
Company or the consummation of the transactions contemplated by this
Agreement, except such as have been obtained and are in full force and
effect under the Act and such as may be required under applicable Blue
Sky laws in connection with the purchase and distribution of the
Shares by the Underwriters and the clearance of such offering with the
NASD.
(10) The execution and performance of this Agreement and the
consummation of the transactions herein contemplated will not conflict
with, result in the breach of, or constitute, either by itself or upon
notice or the passage of time or both, a default under any agreement,
mortgage, deed of trust, lease, franchise, license, indenture, permit
or other instrument actually known to such counsel to which the
Company is a party or by which the Company or any of its property may
be bound or affected which is material to the Company, or violate any
of the provisions of the Certificate of Incorporation or By-Laws of
the Company or, to the actual knowledge of such counsel, violate any
statute, judgment, decree, order, rule or regulation of any court or
governmental body having jurisdiction over the Company or any of its
property.
(11) The Company is not in violation of its Certificate of
Incorporation or By-Laws, or, to the actual knowledge of such counsel,
in breach of or in default with respect to any provision of any
agreement, mortgage, deed of trust, lease, franchise, license,
indenture, permit or other instrument known to such counsel to which
the Company is a party or by which it or any of its properties or
assets (tangible or intangible) may be bound or affected, except where
such violation, breach or default would not materially adversely
affect the Company; and, to the actual knowledge of such counsel, the
Company is in compliance with all laws, rules, regulations,
14
judgments, decrees, orders and statutes of any court or jurisdiction
to which it is subject, except where noncompliance would not
materially adversely affect the Company.
(12) The Selling Shareholder has full power and authority to
enter into this Agreement and the Selling Shareholder Documents and to
sell and deliver the Shares to be sold by it to the several
Underwriters; this Agreement and the Selling Shareholder Documents
have been duly and validly authorized by all necessary action by the
Selling Shareholder, has been duly and validly executed and delivered
by and on behalf of the Selling Shareholder, and is a valid and
binding agreement of the Selling Shareholder enforceable in accordance
with its terms, except as enforceability may be limited by (A)
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other laws affecting the enforcement of creditors'
rights generally and by general equitable principles, and (B) to the
extent that rights to indemnity or contribution under this Agreement
may be limited by federal or state securities laws or the public
policies underlying such laws; and no approval, authorization, order,
consent, registration, filing, qualification, license or permit of or
with any court, regulatory, administrative or other governmental body
is required for the execution and delivery of this Agreement or the
Selling Shareholder Documents by the Selling Shareholder or the
consummation of the transactions contemplated by this Agreement,
except such as have been obtained and are in full force and effect
under the Act and such as may be required under applicable Blue Sky
laws in connection with the purchase and distribution of the Shares by
the Underwriters and the clearance of such offering with the NASD.
(13) To counsel's actual knowledge, no holders of securities
of the Company have rights which have not been waived to the
registration of shares of Common Stock or other securities because of
the filing of the Registration Statement by the Company or the
offering contemplated hereby.
(14) Assuming legal capacity and due execution by the
parties thereto other than the Selling Shareholder, the Lock-up
Agreements are legal, valid and binding obligations of the parties
thereto, enforceable against the party except (i) as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or similar laws
affecting creditors rights generally, and (ii) that the remedies of
specific performance and injunctive and other forms of equitable
relief may be subject to equitable defenses and to the discretion of
the court before which any proceedings therefor may be brought.
(15) The Company is not, and immediately upon completion of
the sale of the Shares contemplated by this Agreement will not be,
required to register as an "investment company" under the Investment
Company Act of 1940, as amended.
In rendering such opinion, counsel to the Company may rely as to
matters of local law, on opinions of local counsel, and as to matters of
fact, on certificates of officers of the Company and of governmental
officials, in which case their opinion is to state that they are so doing.
In addition, such counsel will state in such opinion letters that
it has participated in conferences with officials and other representatives
of the Company, the Representative, Underwriters' counsel and the
independent public accountants of the Company, at which conferences the
contents of the Registration Statement and the Prospectus and related
matters were discussed, and although they have not verified the accuracy or
completeness of the statements contained in the Registration Statement or
the Prospectus, nothing has come to the attention of counsel to the Company
that caused them to believe that, at the time the Registration Statement
became effective, the Registration Statement (except as to financial
statements, financial data and schedules contained therein, as to which
such counsel need make no statement) contained any untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, or on
the Closing Date the Prospectus (except as aforesaid) contained any untrue
statement of a material fact or omitted to state a
15
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which made, not
misleading.
(b) An opinion of ▇▇▇▇▇▇ Pepper & Shefelman as counsel for the
Underwriters dated the Closing Date or the Option Closing Date, as the case
may be, with respect to the incorporation of the Company, the sufficiency
of all corporate proceedings and other legal matters relating to this
Agreement; the validity of the Shares, the Registration Statement and the
Prospectus and other related matters as the Representative may reasonably
require. The Company will furnish to such counsel such documents, papers
and records as they may reasonably request for the purpose of enabling them
to pass upon such matters. In connection with such opinions, such counsel
may rely on representations or certificates of officers of the Company and
governmental officials.
(c) A certificate of the Company executed by the Chief Executive
Officer or President and the chief financial or accounting officer of the
Company, dated the Closing Date or the Option Closing Date, as the case may
be, to the effect that:
(1) The representations and warranties of the Company set
forth in Section 1.1 of this Agreement are true and correct as of the
date of this Agreement and as of the Closing Date or the Option
Closing Date, as the case may be, and the Company has complied in all
material respects with all the agreements and satisfied all the
conditions specified herein on its part to be performed or satisfied
on or prior to the Closing Date or the Option Closing Date, as the
case may be.
(2) The Commission has not issued any order preventing or
suspending the use of the Prospectus or any Preliminary Prospectus
filed as a part of the Registration Statement or any amendment
thereto. No stop order suspending the effectiveness of the
Registration Statement has been issued and, to the best of the
knowledge of the respective signers, no proceedings for that purpose
have been instituted or are pending or contemplated under the Act.
(3) Each of the respective signers of the certificate has
carefully examined the Registration Statement and the Prospectus and,
to the best of his knowledge, the Registration Statement and the
Prospectus and any amendments or supplements thereto contain all
statements required to be stated therein regarding the Company, and
neither the Registration Statement nor any amendment or supplement
thereto includes any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading, and neither the Prospectus
nor any amendment or supplement thereto includes any untrue statement
of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein, in the
light of the circumstances in which made, not misleading.
(d) A certificate of the Selling Shareholder, dated the Closing
Date or the Option Closing Date, as the case may be, to the effect that (i)
the representations and warranties of the Selling Shareholder set forth in
Section 1.2 of this Agreement are true and correct as of the date of this
Agreement and as of the Closing Date or the Option Closing Date, as the
case may be, and (ii) the Selling Shareholder has complied in all material
respects with all the agreements and satisfied all the conditions specified
herein on its part to be performed or satisfied on or prior to the Closing
Date or the Option Closing Date, as the case may be.
(e) Letters from Price Waterhouse LLP and Kraft Bros., Esstman,
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, PLLC, independent accountants for the Company and TBP,
respectively, on each of the date this Agreement is executed, the Closing
Date and the Option Closing Date, addressed to the Representative, to the
effect that they are independent public accountants with respect to the
Company and TBP, respectively. within the meaning of the Act and the Rules
and Regulations and containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters with
respect
16
to financial statements and certain financial information contained in the
Registration Statement and the Prospectus, in form and substance
satisfactory to the Representative.
(f) Such other certificates or documents as the Representative
may reasonably request be delivered from the Company to the Representative
on behalf of the Underwriters.
All such opinions, certificates, letters and documents will be in
compliance with the provisions hereof only if they are reasonably satisfactory
to the Representative and to Underwriters' counsel. The Company will furnish
the Representative with such manually signed or conformed copies of such
opinions, certificates, letters and documents as the Representative reasonably
requests. Any certificate signed by any officer of the Company and delivered to
the Representative or to counsel for the Underwriters in connection with the
closing of the transactions contemplated hereby will be deemed to be a
representation and warranty by the Company to the Underwriters as to the
statements made therein. Any certificate signed by any representative of the
Selling Shareholder and delivered to the Representative or to counsel for the
Underwriters will be deemed to be a representation and warranty by the Selling
Shareholder to the Underwriters as to the statements made therein.
6.4. Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date or the Option Closing Date, as the case may be, there
has not been any change or any development involving a prospective change in or
affecting the general affairs, management, financial position, stockholders'
equity or results of operations of the Company other than as set forth or
contemplated in the Prospectus, the effect of which, in the Representative's
reasonable judgment is material and adverse to the Company and makes it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Shares being delivered at the Closing Date or the Option Closing Date, as
the case may be, on the terms and in the manner contemplated in the Prospectus.
6.5. If any condition to the Underwriters' obligations hereunder to be
satisfied prior to or at the Closing Date is not so satisfied, this Agreement,
at the Representative's election, will terminate upon notification from the
Representative to the Company and the Selling Shareholder without liability on
the part of any Underwriter or the Company except for the expenses to be paid or
reimbursed by the Company pursuant to Sections 5 and 7 hereof and except to the
extent provided in Section 10 hereof.
SECTION 7. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. Notwithstanding any
other provisions hereof, if this Agreement is terminated by the Representative
pursuant to Section 6, or if the sale to the Underwriters of the Shares on the
Closing Date is not consummated because of any refusal, inability or failure on
the part of the Company to perform any agreement herein or to comply with any
provision hereof, the Company agrees to reimburse the Representative and the
other Underwriters, upon demand, for all out-of-pocket expenses that have been
incurred by the Representative or by the other Underwriters in connection with
the proposed purchase and the sale of the Shares, including but not limited to
fees and disbursements of counsel, printing expenses, travel expenses, postage,
telegraph charges and telephone charges relating directly to the offering
contemplated by the Prospectus; provided, however, that such expenses will not
include any portion of overhead or the salary or wages of any Underwriter's
employees. Any such termination will be without liability of any party to any
other party except that the provisions of this Section 7, Section 5 and Section
8 will at all times be effective and will apply. Notwithstanding the foregoing,
the Company will not be obligated to reimburse the Representative or the other
Underwriters for any such expenses if this Agreement is terminated by the
Representative pursuant to Section 6.2 or, after the Closing Date and prior to
the Option Closing Date, Section 6.4, unless the Company has failed or refused
to file an amendment to the Registration Statement or prepare a revised
Prospectus to be recirculated which adequately addresses the matters referred to
in Section 6.2.
17
SECTION 8. INDEMNIFICATION.
8.1. The Company and the Selling Shareholder jointly and severally
agree to indemnify and hold harmless each Underwriter and each person, if any,
who controls any Underwriter within the meaning of the Act, against any losses,
claims, damages, liabilities or expenses, joint or several, to which such
Underwriter or such controlling person may become subject, under the Act, the
Exchange Act, or other federal or state statutory law or regulation, or at
common law or otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of the Company and the Selling
Shareholder ), insofar as such losses, claims, damages, liabilities or expenses
(or actions in respect thereof as contemplated below) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement or any amendment or supplement thereto,
or arise out of or are based upon the omission or alleged omission to state in
any of them a material fact required to be stated therein or necessary to make
the statements in any of them not misleading, or arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact contained
in any Preliminary Prospectus or 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 made therein, in light of the circumstances under which they were
made, not misleading; and will reimburse each Underwriter and each such
controlling person for any legal and other expenses in connection with
investigating, defending, settling, compromising or paying any such loss, claim,
damage, liability, expense or action; provided however, (i) that the Company and
the Selling Shareholder will not be liable in any such case to the extent that
any such loss, claim, damage, liability or expense arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto in reliance upon and in
conformity with information furnished in writing to the Company by the
Representative on behalf of any Underwriter specifically for use therein and
(ii) that such indemnity with respect to any Preliminary Prospectus will not
inure to the benefit of any Underwriter from whom the person asserting any such
loss, claim, damage or liability purchased the Shares which are the subject
thereof if such person did not receive a copy of the Prospectus (or the
Prospectus as amended or supplemented) at or prior to the confirmation of the
sale of such Shares to such person in any case where such delivery is required
by the Act and the untrue statement or omission of a material fact contained in
such Preliminary Prospectus was corrected in the Prospectus (or the Prospectus
as amended or supplemented). In addition to its other obligations under this
Section 8.1, the Company agrees that, as an interim measure during the pendency
of any claim, action, investigation, inquiry or other proceeding arising out of
or based upon any statement or omission, or any alleged statement or omission,
it will reimburse each Underwriter on a quarterly basis for all legal or other
expenses incurred in connection with investigating or defending any such claim,
action, investigation, inquiry or other proceeding, notwithstanding the absence
of a judicial determination as to the propriety and enforceability of the
Company's obligation to reimburse each Underwriter for such expenses and the
possibility that such payments might later be held to have been improper by a
court of competent jurisdiction. To the extent that any such interim
reimbursement payment is so held to have been improper, each Underwriter will
promptly return it to the Company. This indemnity agreement will be in addition
to any liability which the Company and the Selling Shareholder may otherwise
have.
8.2. Each Underwriter will severally indemnify and hold harmless the
Company, each of its directors, each of its officers who signed the Registration
Statement, the Selling Shareholder and each person, if any, who, within the
meaning of the Act, controls the Company or the Selling Shareholder against any
losses, claims, damages, liabilities or expenses to which the Company, any such
director or officer, the Selling Shareholder or any such controlling person may
become subject, under the Act, the Exchange Act, or other federal or state
statutory law or regulation, or at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of such Underwriter), insofar as such losses, claims, damages,
liabilities or expenses (or actions in respect thereof as contemplated below)
arise out of or are based upon any untrue 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 reliance upon and in
conformity with the information furnished to the Company, in writing by the
Representative on behalf of any Underwriter specifically for use
18
therein; and will reimburse the Company, any such director or officer, the
Selling Shareholder or any such controlling person for any legal and other
expense reasonably incurred by the Company, any such director or officer, the
Selling Shareholder or any such controlling person in connection with
investigating, defending, settling, compromising or paying any such loss, claim,
damage, liability, expense or action. In addition to its other obligations
under this Section 8.2, each Underwriter severally agrees that, as an interim
measure during the pendency of any claim, action, investigation, inquiry or
other proceeding arising out of or based upon any statement or omission, or any
alleged statement or omission, described in this Section 8.2 that relates to
such information furnished to the Company, it will reimburse the Company (and,
to the extent applicable, each director and officer, the Selling Shareholder,
and any such controlling person) on a quarterly basis for all reasonable legal
or other expenses incurred in connection with investigating or defending any
such claim, action, investigation, inquiry or other proceeding, notwithstanding
the absence of a judicial determination as to the propriety and enforceability
of the Underwriters' obligation to reimburse the Company (and, to the extent
applicable, each director and officer, the Selling Shareholder, and any such
controlling person) for such expenses and the possibility that such payments
might later be held to have been improper by a court of competent jurisdiction.
To the extent that any such interim reimbursement payment is so held to have
been improper, the Company (and, to the extent applicable, each director and
officer, the Selling Shareholder, and any such controlling person) will promptly
return it to the Underwriters. This indemnity agreement will be in addition to
any liability which such Underwriter may otherwise have.
8.3. Promptly after receipt by an indemnified party under this Section
8 of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against an indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement thereof;
but the omission to so notify the indemnifying party will not relieve an
indemnifying party from any liability which it may have to any indemnified party
for contribution or otherwise under the indemnity agreement contained in this
Section 8 to the extent it is not prejudiced as a proximate result of such
failure. In case any such action is brought against any indemnified party and
such indemnified party seeks or intends to seek indemnity from an indemnifying
party, the indemnifying party will be entitled to participate in, and, to the
extent that it may wish, jointly with all other indemnifying parties similarly
notified, to assume the defense thereof with counsel reasonably satisfactory to
such indemnified party; provided, however, if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party has reasonably concluded that there may be a conflict between
the positions of the indemnifying party and the indemnified party in conducting
the defense of any such action or that there may be legal defenses available to
it and/or other indemnified parties which are different from or additional to
those available to the indemnifying party, the indemnified party or parties will
have the right to select separate counsel to assume such legal defenses and to
otherwise participate in the defense of such action on behalf of such
indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of its election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party under this Section for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof unless (i) the indemnified party has employed such
counsel in connection with the assumption of legal defenses in accordance with
the proviso to the immediately preceding sentence, or (ii) the indemnifying
party has not employed counsel reasonably satisfactory to the indemnified party
to represent the indemnified party within a reasonable time after notice of
commencement of the action, in each of which cases the fees and expenses of
counsel will be at the expense of the indemnifying party.
8.4. If the indemnification provided for in this Section 8 is required
by its terms but is for any reason held to be unavailable to or otherwise
insufficient to hold harmless an indemnified party under Section 8.1 or Section
8.2 with respect to any losses, claims, damages, liabilities or expenses
referred to herein, then each applicable indemnifying party will contribute to
the amount paid or payable by such indemnified party as a result of any losses,
claims, damages, liabilities or expenses referred to herein (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company, the Selling Shareholder and the Underwriters 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 Company, the Selling Shareholder and the Underwriters in connection with the
statements or omissions that resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The respective relative benefits received by the Company, the Selling
Shareholder and the Underwriters will be deemed to be in the same proportion, in
the case of the Company, as the total price paid
19
to the Company for the Shares sold by it to the Underwriters (net of
underwriting commissions but before deducting other expenses), in the case of
the Selling Shareholder, as the total price paid to the Selling Shareholder for
the Shares sold by it to the Underwriters (net of underwriting commissions but
before deducting other expenses) and, in the case of the Underwriters, as the
underwriting commissions received by them. The relative fault of the Company,
the Selling Shareholder and the Underwriters will be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company, the Selling Shareholder or the Underwriters
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 will be deemed to include, subject to the
limitations set forth in Section 8.3, any legal or other fees or expenses
reasonably incurred by such party in connection with investigating or defending
any action or claim. The provisions set forth in Section 8.3 with respect to
notice of commencement of any action will apply if a claim for contribution is
to be made under this Section 8.4; provided, however, that no additional notice
will be required with respect to any action for which notice has been given
under Section 8.3 for purposes of indemnification. The Company, the Selling
Shareholder and the Underwriters agree that it would not be just and equitable
if contribution pursuant to this Section 8.4 were determined solely by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take into account
the equitable considerations referred to herein. Notwithstanding the provisions
of this Section 8.4, no Underwriter will be required to contribute any amount in
excess of the amount of the total underwriting commissions received by such
Underwriter in connection with the Shares underwritten by it and distributed to
the public. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) will be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute pursuant to this Section 8.4 are several
in proportion to their respective underwriting commitments and not joint.
8.5. In the event that suit or action is instituted with respect to
any failure to comply, or any alleged failure to comply, by the Company or the
Selling Shareholder with any obligation of the Company or the Selling
Shareholder under any covenants or obligations as stated in this Agreement, the
prevailing party will be entitled to recover its attorney fees, including those
incurred on appeal, as determined by the court.
SECTION 9. DEFAULT OF UNDERWRITERS. It will be a condition to this
Agreement and the obligation of the Company and the Selling Shareholder to sell
and deliver the Shares hereunder, and of each Underwriter to purchase the Shares
in the manner as described herein, that, except as hereinafter in this paragraph
provided, each of the Underwriters will purchase and pay for all the Shares
agreed to be purchased by such Underwriter hereunder upon tender to the
Representative of all such shares in accordance with the terms hereof. If any
Underwriter or Underwriters default in their obligations to purchase Shares
hereunder on either the Closing Date or the Option Closing Date and the
aggregate number of Shares that such defaulting Underwriter or Underwriters
agreed but failed to purchase on such Closing Date does not exceed 10 percent of
the total number of Shares that the Underwriters are obligated to purchase on
the Closing Date or Option Closing Date, as the case may be, the nondefaulting
Underwriters will be obligated severally, in proportion to their respective
commitments hereunder, to purchase the Shares that such defaulting Underwriters
agreed but failed to purchase on the Closing Date or Option Closing Date, as the
case may be. If any Underwriter or Underwriters so default and the aggregate
number of Shares with respect to which such default occurs is more than the
above percentage and arrangements satisfactory to the Representative, the
Company and the Selling Shareholder for the purchase of such Shares by other
persons are not made within 48 hours after such default, this Agreement will
terminate without liability on the part of any nondefaulting Underwriter or the
Company except for the expenses to be paid by the Company and the Selling
Shareholder pursuant to Section 5 hereof.
In the event that Shares to which a default relates are to be purchased by
the nondefaulting Underwriters or by another party or parties, the
Representative or the Company will have the right to postpone the Closing Date
or Option Closing Date, as the case may be, for not more than five business days
in order that the necessary changes in the Registration Statement, Prospectus
and any other documents, as well as any other arrangements, may be effected. As
used in this Agreement, the term "Underwriter" includes any person substituted
for an Underwriter under this Section. Nothing herein will relieve a defaulting
Underwriter from liability for its default.
20
SECTION 10. TERMINATION. Without limiting the right to terminate this
Agreement pursuant to any other provision hereof, this Agreement may be
terminated by the Representative by notice to the Company and the Selling
Shareholder at any time prior to the Closing Date (i) if additional material
governmental restrictions, not in force and effect on the date hereof, will have
been imposed upon trading in securities generally or minimum or maximum prices
have been generally established on the New York Stock Exchange or on the
American Stock Exchange or in the over the counter market by the NASD, or
trading in securities generally has been suspended on either such Exchange or in
the over the counter market by the NASD, or a general banking moratorium has
been established by federal, New York or Oregon authorities, (ii) if an outbreak
of major hostilities or other national or international calamity or any
substantial change in political, financial or economic conditions has occurred
or has accelerated or escalated to such an extent as, in the reasonable judgment
of the Representative, to affect materially and adversely the marketability of
the Shares, (iii) if any adverse event has occurred or exists that makes untrue
or incorrect, in any material respect, any statement or information contained in
the Registration Statement or Prospectus or which is not reflected in the
Registration Statement or Prospectus but should be reflected therein in order to
make the statements or information contained therein not misleading in any
material respect, or (iv) if there is any action, suit or proceeding pending or
threatened, or there has been any development or prospective development
involving particularly the business or properties or securities of the Company
or the transactions contemplated by this Agreement, that, in the reasonable
judgment of the Representative, may materially and adversely affect the
Company's business or earnings and makes it impracticable or inadvisable to
offer or sell the Shares. Any termination pursuant to this Section 10 will be
without liability on the part of any Underwriter to the Company or the Selling
Shareholder or on the part of the Company of the Selling Shareholder to any
Underwriter (except for expenses to be paid or reimbursed to the Underwriters by
the Company pursuant to Section 5 hereof and except to the extent provided in
Section 8 hereof.
SECTION 11. REPRESENTATIONS AND INDEMNITIES TO SURVIVE DELIVERY. The
respective indemnities, agreements, representations, warranties and other
statements of the Company, the Selling Shareholder and of the several
Underwriters set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation made by or on behalf of any
Underwriter, the Company, the Selling Shareholder or any of its or their
partners, officers or directors or any controlling person, as the case may be,
and will survive delivery of and payment for the Shares sold hereunder or any
termination of this Agreement.
SECTION 12. NOTICES. All communications hereunder will be in writing and,
if sent to the Underwriters will be mailed, delivered or telecopied and
confirmed to the Representative at Black & Company, Inc., ▇▇▇ ▇.▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇, with a copy to ▇▇▇▇
▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ Pepper & Shefelman, ▇▇▇ ▇.▇. ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇; if sent to the Company will be mailed, delivered or telecopied and
confirmed to the Company at ▇▇▇▇▇▇ Products Ltd., ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, with a copy to ▇▇▇▇▇
▇▇▇▇▇▇, III, Winthrop, Stimson, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇-▇▇▇▇; and if sent to the Selling Shareholder will be mailed, delivered or
telecopied and confirmed to the Selling Shareholder at Saugatuck Capital Company
Limited Partnership, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, with a copy to
▇▇▇▇▇ ▇▇▇▇▇▇, III, Winthrop, Stimson, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇-▇▇▇▇. The Company, the Selling Shareholder or the Representative may
change the address for receipt of communications hereunder by giving notice in
writing to the others.
SECTION 13. SUCCESSORS. This Agreement will inure to the benefit of and
be binding upon the parties hereto, including any substitute Underwriters
pursuant to Section 9 hereof, and to the benefit of the officers and directors
and controlling persons referred to in Section 8, and in each case their
respective successors, personal representatives and assigns, and no other person
will have any right or obligation hereunder. No such assignment will relieve
any party of its obligations hereunder. The term "successors" will not include
any purchaser of the Shares as such from any of the Underwriters merely by
reason of such purchase.
SECTION 14. REPRESENTATION OF UNDERWRITERS. Black & Company, Inc. will
act as the Representative for the several Underwriters in connection with all
dealings hereunder, and any action under or in respect of this Agreement taken
by them, as the Representative, will be binding upon all the Underwriters.
SECTION 15. PARTIAL UNENFORCEABILITY. The invalidity or unenforceability
of any section, paragraph or provision of this Agreement will not affect the
validity or enforceability of any other section, paragraph or provision
21
hereof. If any section, paragraph or provision of this Agreement is for any
reason determined to be invalid or unenforceable, there will be deemed to be
made such minor changes (and only such minor changes) as are necessary to make
it valid and enforceable.
SECTION 16. APPLICABLE LAW. This Agreement will be governed by and
construed in accordance with the internal laws (and not the laws pertaining to
conflicts of laws) of the state of Oregon.
SECTION 17. GENERAL. This Agreement constitutes the entire agreement of
the parties to this Agreement and supersedes all prior written or oral and all
contemporaneous oral agreements, understandings and negotiations with respect to
the subject matter hereof. This Agreement may be executed in several
counterparts, each one of which will be an original, and all of which will
constitute one and the same document. In this Agreement, the masculine,
feminine and neuter genders and the singular and the plural include one another.
The section headings in this Agreement are for the convenience of the parties
only and will not affect the construction or interpretation of this Agreement.
This Agreement may be amended or modified, and the observance of any term of
this Agreement may be waived, only by a writing signed by the Company, the
Selling Shareholder and the Representative.
If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to us the enclosed copies hereof, whereupon it will
become a binding agreement among the Company, the Selling Shareholder and the
several Underwriters including the Representative, all in accordance with its
terms.
Very truly yours,
▇▇▇▇▇▇ PRODUCTS LTD.
By:_____________________________________
Title:__________________________________
SAUGATUCK CAPITAL COMPANY LIMITED
PARTNERSHIP
By:_____________________________________
_____________________________________
The foregoing Underwriting Agreement is hereby
confirmed and accepted by us in Portland, Oregon
as of the date first above written.
BLACK & COMPANY, INC.
By:_____________________________________
Acting as the Representative of the several Underwriters
named in the attached Schedule A.
22
SCHEDULE A
Number of Firm
Shares
Name of Underwriter to be Purchased
------------------- ---------------
Black & Company, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..
TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . .3,400,000