ARMOR HOLDINGS, INC.
COMMON STOCK
($0.01 Par Value)
UNDERWRITING AGREEMENT
July ___, 1997
UNDERWRITING AGREEMENT
July ___, 1997
▇▇▇▇▇▇, Read & Co. Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Equitable Securities Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
as Managing Underwriters
Dear Sirs:
Armor Holdings, Inc., a Delaware corporation (the "Company"),
proposes to issue and sell and the persons named in Schedule B (the "Selling
Shareholders") propose to sell to the underwriters named in Schedule A (the
"Underwriters") an aggregate of 4,600,000 shares of Common Stock, par value $
0.01 per share (the "Common Stock"), of the Company, of which 4,000,000 shares
are to be issued and sold by the Company (the "Firm Shares") and an aggregate
of 600,000 shares are to be sold by the Selling Shareholders in the respective
amounts set forth opposite their names in Schedule B, solely for the purpose of
covering overallotments (the "Additional Shares"). The Additional Shares and
the Firm Shares are collectively referred to as the "Shares". The Shares are
described in the Prospectus which is referred to below.
The Company has filed, in accordance with the provisions of
the Securities Act of 1933, as amended, and the rules and regulations
thereunder (collectively, the "Act"), with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-1, including a
prospectus, relating to the Shares. The Company has furnished to you, for use
by the Underwriters and by dealers, copies of one or more preliminary
prospectuses (collectively, the "Preliminary Prospectus") relating to the
Shares. Except where the context otherwise requires, the registration statement
as in effect at the time of execution of this Agreement or, if the registration
statement is
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not yet effective, as amended when it becomes effective, including
all documents filed as a part thereof, and including any registration statement
filed pursuant to Rule 462(b) under the Act increasing the size of the offering
registered under the Act and any information contained in a prospectus
subsequently filed with the Commission pursuant to Rule 424(b) under the Act
and deemed to be part of the registration statement at the time of
effectiveness pursuant to Rule 430A under the Act, is herein called the
"Registration Statement", and the prospectus in the form filed by the Company
with the Commission pursuant to Rule 424(b) under the Act or, if no such filing
is required, in the form of final prospectus included in the Registration
Statement at the time it became effective, is herein called the "Prospectus".
The Company, the Selling Shareholders and the Underwriters
agree as follows:
1. Sale and Purchase. On the basis of the representations and
warranties and the other terms and conditions herein set forth, the Company
agrees to sell to the respective Underwriters and each of the Underwriters,
severally and not jointly, agrees to purchase from the Company the respective
number of Firm Shares (subject to such adjustment as you may determine to avoid
fractional shares) which bears the same proportion to the number of Firm Shares
to be sold by the Company as the number of Firm Shares set forth opposite the
name of such Underwriter on Schedule A bears to the total number of Firm Shares
to be sold by the Company, in each case at a purchase price of $____ per Share.
You may release the Firm Shares for public sale promptly after this Agreement
becomes effective. You may from time to time increase or decrease the public
offering price after the initial public offering to such extent as you may
determine.
In addition, on the basis of the representations and
warranties and the other terms and conditions herein set forth, the Selling
Shareholders hereby grant to the several Underwriters an option to purchase,
and the Underwriters shall have the right to purchase, severally and not
jointly, from such Selling Shareholders all or a portion of the Additional
Shares as may be necessary to cover overallotments made in connection with the
offering of the Firm Shares, at the same purchase price per share to be paid by
the several Underwriters to the Company for the Firm Shares. This option may be
exercised in whole or in part from time to time on or before the thirtieth day
following the date hereof, by written notice to the Company. Any such notice
shall set forth the aggregate number of Additional Shares as to which the
option is being exercised, and the
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date and time when the Additional Shares are to be delivered (any such date and
time being herein referred to as an "additional time of purchase"); provided,
however, that no additional time of purchase shall occur earlier than the time
of purchase (as defined below) nor earlier than the second business day* after
the date on which the option shall have been exercised nor later than the
eighth business day after the date on which the option shall have been
exercised. The number of Additional Shares to be sold to each Underwriter at an
additional time of purchase shall be the number which bears the same proportion
to the aggregate number of Additional Shares being purchased at such additional
time of purchase as the number of Firm Shares set forth opposite the name of
such Underwriter on Schedule A bears to the total number of Firm Shares
(subject, in each case, to such adjustment as you may determine to eliminate
fractional shares).
2. Payment and Delivery. Payment of the purchase price for
the Firm Shares shall be made to the Company by wire transfer, or certified or
official bank checks in immediately available funds, at the office of ▇▇▇▇▇▇,
Read & Co. Inc. in New York City, against delivery of the certificates for the
Firm Shares to you for the respective accounts of the Underwriters. Such
payment and delivery shall be made at 9:30 A.M., New York City time, on July
___, 1997 (unless another time shall be agreed to by you and the Company or
unless postponed in accordance with the provisions of Section 9). The time at
which such payment and delivery are actually made is called the "time of
purchase". Certificates for the Firm Shares shall be delivered to you in
definitive form in such names and in such denominations as you shall specify on
the second business day preceding the time of purchase. For the purpose of
expediting the checking of the certificates for the Firm Shares by you, the
Company agrees to make such certificates available to you for such purpose at
least one full business day preceding the time of purchase.
Payment of the purchase price for the Additional Shares shall
be made to the Attorney-in-fact referred to in Section 4(d) on behalf of the
Selling Shareholders at the additional time of purchase in the same manner and
at the same office as the payment for the Firm Shares. Certificates for the
Additional Shares shall be delivered to
----------------------
* As used herein, "business day" shall mean a day on which the New York
Stock Exchange is open for trading.
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you in definitive form in such names and in such denominations as you shall
specify on the second business day preceding the additional time of purchase.
For the purpose of expediting the checking of the certificates for the
Additional Shares by you, the Selling Shareholders agree to make such
certificates available to you for such purpose at least one full business day
preceding the additional time of purchase.
3. Representations and Warranties of the Company and the
Management Selling Shareholders. The Company and each of Kanders Florida
Holdings, Inc. and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (the "Management Selling Shareholders"),
jointly and severally, represent and warrant to each of the Underwriters that:
(a) Each Preliminary Prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the Act, complied when so
filed in all material respects with the Act; when the Registration
Statement becomes or became effective and at all times subsequent
thereto up to the time of purchase and the additional time of
purchase, the Registration Statement and the Prospectus, and any
supplements or amendments thereto, complied and will comply in all
material respects with the provisions of the Act; and the Registration
Statement at all such times did not and will not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading, and the Prospectus at all such times did not and will not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they
were made, not misleading; provided, however, that the Company and the
Management Selling Shareholders make no representation or warranty
with respect to any statement contained in the Registration Statement
or the Prospectus in reliance upon and in conformity with information
concerning the Underwriters and furnished in writing by or on behalf
of any Underwriter through you to the Company expressly for use in the
Registration Statement or the Prospectus and set forth in the section
of the Registration Statement and the Prospectus entitled
"Underwriting".
(b) As of the date of this Agreement, the Company has an
authorized capitalization as set forth under the column entitled
"March 29, 1997, Actual" in the section of the Registration Statement
and the Prospectus entitled "Capitalization" and, as of the time of
purchase, the capitalization of the Company will be as set forth under
the column entitled "March 29, 1997, Pro Forma As Adjusted" in the
section of the Registration Statement and the Prospectus
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entitled "Capitalization"; all of the issued and outstanding shares of
capital stock of the Company have been duly authorized and validly
issued and are fully paid and nonassessable and are free of statutory
and contractual preemptive rights.
(c) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Delaware with full power and authority to (i) own its properties
and conduct its business as described in the Registration Statement
and the Prospectus and (ii) execute and deliver this Agreement and to
issue, sell and deliver the Firm Shares as herein contemplated.
(d) Set forth on Schedule D is a list of all subsidiaries of
the Company that own any assets or have any liabilities or have
conducted business during the period beginning January 1, 1992 (the
"Material Subsidiaries"). All of the issued and outstanding shares of
capital stock of each of the Material Subsidiaries are owned directly
or indirectly by the Company; all of such shares have been duly
authorized and validly issued and are fully paid and nonassessable
and, except as described in the Prospectus, are owned free and clear
of any pledge, lien, encumbrance, security interest or other claim;
there are no outstanding rights, subscriptions, warrants, calls,
preemptive rights, options or other agreements of any kind with
respect to the capital stock of any of the Subsidiaries.
(e) Each of the Material Subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of its respective jurisdiction of incorporation, with
full corporate power and authority to own its respective properties
and to conduct its respective businesses.
(f) Each of the Company and each of the Material Subsidiaries
is duly qualified or licensed by and is in good standing in each
jurisdiction in which it owns or leases property or conducts its
business and in each other jurisdiction in which the failure,
individually or in the aggregate, to be so qualified or licensed could
reasonably be expected to have a material adverse effect on the
properties, assets, operations, business,
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business prospects or condition (financial or other) of the Company
and the Material Subsidiaries taken as a whole; each of the Company
and each of the Material Subsidiaries is in compliance in all material
respects with the laws, orders, rules, regulations and directives
issued or administered by each such jurisdiction.
(g) Neither the Company nor any of the Material Subsidiaries
is in breach of, or in default under (nor has any event occurred which
with notice, lapse of time or both would constitute a breach of, or
default under), its charter or bylaws, or in the performance or
observance of any obligation, agreement, covenant or condition
contained in any license, indenture, lease, mortgage, deed of trust,
bank loan or credit agreement, material supply agreement or other
agreement or instrument to which the Company or any of the Material
Subsidiaries is a party or by which any of them may be bound or
affected, which breach or default could have a material adverse effect
on the properties, assets, operations, business, business prospects or
condition (financial or other) of the Company and the Material
Subsidiaries taken as a whole. The execution, delivery and performance
of this Agreement, the issuance of the Firm Shares, the sale of the
Shares, the application of the net proceeds thereof as described in
the Prospectus and the consummation of the transactions contemplated
hereby will not conflict with, or result in any breach of or
constitute a default under (nor constitute any event which with
notice, lapse of time or both would constitute a breach of, or default
under), the charter or bylaws of the Company or any of the Material
Subsidiaries or under any provision of any license, indenture, lease,
mortgage, deed of trust, bank loan or credit agreement, material
supply agreement or other agreement or instrument to which the Company
or any of the Material Subsidiaries is a party or by which any of them
or their properties may be bound or affected, or under any federal,
state, local or foreign law, regulation or rule or any decree,
judgment or order applicable to the Company or any of the Material
Subsidiaries.
(h) The Firm Shares, when issued and delivered to and paid
for by the Underwriters as contemplated hereby, will be duly
authorized, validly issued, fully paid and nonassessable, free and
clear of any pledge, lien, encumbrance, security interest, preemptive
right or other claim. The Additional Shares are duly authorized,
validly issued, fully paid and non-assessable.
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(i) This Agreement has been duly authorized, executed and
delivered by the Company.
(j) The capital stock of the Company, including the Shares,
conforms in all material respects to the description thereof contained
in the Registration Statement and the Prospectus; and the certificates
for the Shares are in due and proper form and the holders of the
Shares after making payment therefor will not be subject to personal
liability by reason of being such holders.
(k) No approval, authorization, consent or order of or filing
with any federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency is required in connection
with the issuance of the Firm Shares and sale of the Shares as
contemplated hereby, other than registration of the Shares under the
Act, clearance of the offering of the Shares with the National
Association of Securities Dealers, Inc. (the "NASD"), listing the Firm
Shares on the American Stock Exchange, Inc. (the "AMEX") and any
necessary qualification under the securities or blue sky laws of the
various jurisdictions in which the Shares are being offered by the
Underwriters.
(l) Each person who has the right, contractual or otherwise,
to cause the Company to register pursuant to the Act any securities of
the Company in consequence of the issue and sale of the Shares to the
Underwriters hereunder either included such securities in the
Registration Statement or duly waived such right and each person who
has the right, contractual or otherwise, to cause the Company to issue
to it any securities of the Company in consequence of the issue and
sale of the Shares to the Underwriters hereunder has duly waived such
right.
(m) Each of (i) Deloitte & Touche LLP, whose reports on the
certain consolidated financial statements and the supplemental
consolidated financial statements of the Company and (ii) KPMG, whose
report on the consolidated financial statements of each of DSL Group
Limited and DSL Holdings Limited are included in the Registration
Statement and the Prospectus, are independent public accountants with
respect to the Company as required by the Act and the applicable
published rules and regulations thereunder.
(n) All legal or governmental proceedings, contracts or
documents of a character required to be described in the Registration
Statement or the
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Prospectus or to be filed as an exhibit to the Registration Statement
have been so described or filed as required.
(o) Except as disclosed in the Registration Statement and the
Prospectus, there is no action, suit or proceeding pending or, to the
knowledge of the Company, threatened against the Company or any of the
Material Subsidiaries or any of their properties, at law or in equity,
or before or by any federal, state, local or foreign governmental or
regulatory commission, board, body, authority or agency that could
result in a judgment, decree or order having a material adverse effect
on the properties, assets, operations, business, business prospects or
condition (financial or other) of the Company and the Material
Subsidiaries taken as a whole.
(p) The audited and unaudited financial statements included
in the Registration Statement and the Prospectus present fairly the
consolidated financial condition of the Company and the Subsidiaries
as of the dates indicated and the consolidated results of operations
and cash flows of the Company and the Subsidiaries for the periods
specified; such financial statements have been prepared in conformity
with generally accepted accounting principles applied on a consistent
basis during the periods involved.
(q) Subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
and except as may be otherwise stated in the Registration Statement or
the Prospectus, there has not been: (A) any material adverse change in
the properties, assets, operations, business, business prospects or
condition (financial or other), present or prospective, of the Company
and the Material Subsidiaries taken as a whole; (B) any transaction,
that is material to the Company and the Material Subsidiaries taken as
a whole, contemplated or entered into by the Company or any of the
Material Subsidiaries; or (C) any obligation, contingent or otherwise,
directly or indirectly incurred by the Company or any of the Material
Subsidiaries that is material to the Company and the Material
Subsidiaries taken as a whole.
(r) The Company has obtained the agreement of the
shareholders listed on Schedule C not to, directly or indirectly,
offer, sell, contract to sell, make subject to any purchase option or
otherwise dispose of or cause the disposition of any shares of Common
Stock, or any
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securities convertible into or exerciseable or exchangeable for Common
Stock prior to the expiration of 180 days from the date of the
effectiveness of the Registration Statement without the prior written
consent of ▇▇▇▇▇▇, Read & Co. Inc., except for transfers to any such
shareholder's spouse, child, grandchild, parent or sibling, or to a
trust for the benefit of such shareholder or any such related person,
so long as such transferee executes a copy of the letter agreement
executed by such shareholder and becomes bound thereby.
(s) Neither the Company nor any of the Material Subsidiaries
has violated any foreign, federal, state or local law or regulation
relating to the protection of human health and safety, the environment
or hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws"), nor any federal or state law relating to
discrimination in the hiring, promotion or pay of employees nor any
applicable federal or state wages and hours laws, nor any provisions
of the Employee Retirement Income Security Act or the rules and
regulations promulgated thereunder, which in each case might result in
any material adverse effect on the properties, assets, operations,
business, business prospects or condition (financial or other) of the
Company and the Material Subsidiaries taken as a whole.
(t) The Company and each of the Material Subsidiaries has
such permits, licenses, franchises and authorizations of governmental
or regulatory authorities ("permits"), including without limitation
under any applicable Environmental Laws, as are necessary to own,
lease and operate its respective properties and to conduct its
business except where the failure to have any such permit, license,
franchise or authorization would not result in any material adverse
effect on the properties, assets, operations, business, business
prospects or condition (financial or otherwise) of the Company and the
Material Subsidiaries taken as a whole; the Company and each of the
Material Subsidiaries has fulfilled and performed all of its material
obligations with respect to such permits and no event has occurred
which allows, or after notice or lapse of time would allow, revocation
or termination thereof or results in any other material impairment of
the rights of the holder of any such permit.
(u) Neither the Company nor any of the Material Subsidiaries,
nor any employee of the Company or any of the Material Subsidiaries,
has made any payment of
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funds of the Company or any of the Material Subsidiaries prohibited by
law, and no funds of the Company or any of the Material Subsidiaries
have been set aside to be used for any payment prohibited by law.
(v) The Company and the Subsidiaries have filed all federal
or state income or franchise tax returns required to be filed and have
paid all taxes shown thereon as due, and there is no material tax
deficiency which has been or might be asserted against the Company or
any of the Subsidiaries; all material tax liabilities are adequately
provided for on the books of the Company and the Subsidiaries.
(w) The Company has not incurred any liability for any
finder's fees or similar payments in connection with the transactions
herein contemplated.
(x) The Company and the Material Subsidiaries have good title
to all properties and assets owned or leased by them, in each case
free and clear of all liens, security interests, pledges, charges,
encumbrances, mortgages and defects (except such as are described or
referred to in the Prospectus and the financial statements and the
notes thereto contained therein or such as do not interfere in any
material respect with the use made and proposed to be made of such
property by the Company and the Material Subsidiaries).
(y) Neither the Company nor any of the Subsidiaries is an
"investment company" within the meaning of the Investment Company Act
of 1940, as amended, or is subject to regulation under such Act.
4. Further Representations and Warranties of the Selling
Shareholders. Each Selling Shareholder, severally and not jointly, further
represents and warrants to each Underwriter that:
(a) Such Selling Shareholder is and at the time of delivery
of the Additional Shares to be sold by such Selling Shareholder will
be the lawful owner of the number of Additional Shares to be sold by
such Selling Shareholder pursuant to this Agreement and, at the time
of delivery thereof, will have valid and marketable title to such
Additional Shares, and upon delivery of and payment for such
Additional Shares the Underwriters will acquire valid and marketable
title to such Additional Shares free and clear of any claim, lien,
encumbrance, security interest, community property right, restriction
on transfer or other defect in
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title, assuming each of the Underwriters has purchased the Additional
Shares purchased by it in good faith and without notice of any adverse
claim.
(b) Such Selling Shareholder has and at the time of delivery
of such Additional Shares will have full legal right, power and
capacity, and any approval required by law to sell, assign, transfer
and deliver such Additional Shares in the manner provided in this
Agreement.
(c) The Power of Attorney executed by the Selling
Shareholders (the "Power of Attorney") and the Custody Agreement among
the Selling Shareholders and American Stock Transfer & Trust Company
(the "Custody Agreement") have been duly executed and delivered by
such Selling Shareholder and are legal, valid and binding agreements
of such Selling Shareholder, enforceable in accordance with their
terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally and general principles of
equity.
(d) Such Selling Shareholder has duly and irrevocably
authorized the Attorney-in-Fact (as defined in the Power of Attorney),
on behalf of such Selling Shareholder, to execute and deliver this
Agreement and any other document necessary or desirable in connection
with the transactions contemplated hereby and to deliver the Shares to
be sold by such Selling Shareholder and receive payment therefor
pursuant hereto.
(e) The sale of the Additional Shares by such Selling
Shareholder pursuant hereto is not prompted by any material adverse
information concerning the Company; and all information furnished in
writing by or on behalf of such Selling Shareholder specifically for
use in the Registration Statement and the Prospectus, and any
supplement or amendment thereto, is and will be when the Registration
Statement became effective and at all times subsequent thereto up to
the time of purchase and the additional time of purchase, true and
correct and complete in all material respects and at all such times
did not and will not contain any untrue statement of 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.
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(f) The consummation of the transactions contemplated hereby
and by the Power of Attorney and by the Custody Agreement and the
fulfillment of the terms hereof and thereof will not constitute a
breach or violation of or default under any trust, indenture,
agreement or other instrument to which any such Selling Shareholder is
a party or by which any such Selling Shareholder is bound.
5. Certain Covenants of the Company. The Company hereby
agrees:
(a) to furnish such information as may be required and
otherwise to cooperate in qualifying the Shares for offering and sale
under the securities or blue sky laws of such states as you may
designate and to maintain such qualifications in effect as long as
required for the distribution of the Shares, provided that the Company
shall not be required to qualify as a foreign corporation or to
consent to the service of process under the laws of any such state
(except service of process with respect to the offering and sale of
the Shares); promptly to advise you of the receipt by the Company of
any notification with respect to the suspension of the qualification
of the Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and to use its best
efforts to obtain the withdrawal of any order of suspension at the
earliest practicable moment;
(b) to make available to you in New York City, as soon as
practicable after the Registration Statement becomes effective, and
thereafter from time to time to furnish to the Underwriters, as many
copies of the Prospectus (or of the Prospectus as amended or
supplemented if the Company shall have made any amendment or
supplement thereto after the effective date of the Registration
Statement) as the Underwriters reasonably may request for the purposes
contemplated by the Act;
(c) to advise you promptly and if requested by you to confirm
such advice in writing, (i) when the Registration Statement has become
effective and when any post-effective amendment thereto becomes
effective and (ii) when the Prospectus is filed with the Commission
pursuant to Rule 424(b) under the Act, if required under the Act
(which the Company agrees to file in a timely manner under such Rule);
(d) to advise you promptly, confirming such advice in
writing, of any request by the Commission for
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amendments or supplements to the Registration Statement or the
Prospectus or for additional information with respect thereto, or of
notice of institution of proceedings for or the entry of a stop order
suspending the effectiveness of the Registration Statement and, if the
Commission should enter a stop order suspending the effectiveness of
the Registration Statement, to use its best efforts to obtain the
lifting or removal of such order as soon as possible; to advise you
promptly of any proposal to amend or supplement the Registration
Statement or the Prospectus and to file no such amendment or
supplement to which you shall object in writing;
(e) to furnish to you and, upon request to each of the other
Underwriters, for a period of five years from the date of this
Agreement (i) copies of all reports or other communications that the
Company shall send to its shareholders or from time to time shall
publish or publicly disseminate and (ii) copies of all annual,
quarterly and current reports filed with the Commission on Forms 10-K,
10-Q and 8-K, or such other similar form as may be designated by the
Commission, and any other document filed by the Company pursuant to
Section 12, 13, 14 or 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act");
(f) to advise the Underwriters promptly of the happening of
any event known to the Company within the time during which a
prospectus relating to the Shares is required to be delivered under
the Act that, in the reasonable judgment of the Company, would require
the making of any change in the Prospectus then being used, so that
the Prospectus, as then supplemented, would not include an untrue
statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they are made, not misleading and, during
such time, promptly to prepare and furnish, at the Company's expense,
to the Underwriters such amendments or supplements to such Prospectus
as may be necessary to reflect any such change in such quantities as
reasonably requested by the Underwriters, and to furnish to you a copy
of such proposed amendment or supplement before filing any such
amendment or supplement with the Commission;
(g) to make generally available to its security holders, and
to deliver to you, an earnings statement of the Company (which need
not be audited and which will satisfy the provisions of Section 11(a)
of the Act including, at the option of the Company, Rule 158)
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covering a period of 12 months beginning after the effective date of
the Registration Statement but ending not later than 15 months after
the date of the Registration Statement, as soon as is reasonably
practicable after the termination of such 12-month period;
(h) to furnish to you four signed copies of the Registration
Statement, as initially filed with the Commission, and of all
amendments thereto (including all exhibits thereto) and sufficient
conformed copies of the foregoing (other than exhibits) for
distribution of a copy to each of the other Underwriters;
(i) to furnish to you as early as practicable prior to the
time of purchase and the additional time of purchase, as the case may
be, but not later than two business days prior thereto, a copy of the
latest available unaudited interim consolidated financial statements,
if any, of the Company and the Subsidiaries that have been read by the
Company's independent certified public accountants as stated in their
letter to be furnished pursuant to Section 8(b);
(j) to apply the net proceeds from the sale of the Shares
sold by the Company in the manner set forth under the caption "Use of
Proceeds" in the Registration Statement and the Prospectus;
(k) to use its best efforts to cause the Shares to be
listed on the American Stock Exchange;
(l) whether or not the transactions contemplated in this
Agreement are consummated or this Agreement otherwise becomes
effective or is terminated, to pay all expenses, fees and taxes (other
than (x) any transfer taxes and (y) fees and disbursements of your
counsel except as set forth under Section 7 and clauses (iii) and (iv)
below) in connection with (i) the preparation and filing of the
Registration Statement, each Preliminary Prospectus, the Prospectus
and any amendment or supplement thereto, and the printing and
furnishing of copies of each thereof to you and to dealers (including
costs of mailing and shipment), (ii) the issuance, sale and delivery
of the Shares, (iii) the word processing or printing of this Agreement
and any dealer agreements, and the reproduction or printing and
furnishing of copies of each thereof to you and to dealers (including
costs of mailing and shipment), (iv) the qualification of the Shares
for offering and sale under state laws as aforesaid (including
reasonable legal fees and filing
14
fees and other disbursements of your counsel) and the printing and
furnishing of copies of any blue sky surveys to you and to dealers,
(v) any listing of the Shares on any securities exchange or
qualification of the Shares for inclusion in the Nasdaq National
Market and any registration thereof under the Exchange Act, (vi) any
filing for review of the public offering of the Shares by the NASD and
(viii) the performance of the Company's and the Selling Shareholders'
other obligations hereunder;
(m) not to sell, contract to sell, grant any option to sell
(except employee stock options pursuant to the Company's existing
employee stock option plans), 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, except for the registration of the
Shares and the sales to you pursuant to this Agreement for a period
commencing on the date hereof and continuing for 180 days after the
date of effectiveness of the Registration Statement, without the prior
written consent of ▇▇▇▇▇▇, Read & Co. Inc.; provided, however, that
the foregoing will not restrict the issuance by the Company of shares
of Common Stock in a private transaction in connection with the
acquisition by the Company of a business or assets so long as the
recipient of such shares of Common Stock executes a letter
substantially in the form of the letters executed by the shareholders
listed on Schedule C referred to in Section 8(i); and
(n) to refrain from investing the proceeds from the sale of
the Shares in a manner to cause the Company or any of the Subsidiaries
to become an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
6. Certain Covenants of the Selling Shareholders. Each
Selling Shareholder agrees with each Underwriter that such Selling Shareholder
will not, directly or indirectly, offer, sell, contract to sell, make subject
to any purchase option or otherwise dispose of or cause the disposition of any
shares of Common Stock, or any securities convertible into or exerciseable or
exchangeable for Common Stock prior to the expiration of 180 days from the date
of the effectiveness of the Registration Statement without the prior written
consent of ▇▇▇▇▇▇, Read & Co. Inc., except for transfers to any such
shareholder's spouse, child, grandchild, parent or sibling, or to a trust for
the benefit
15
of such shareholder or any such related person, so long as such transferee
executes a copy of the letter agreement executed by such shareholder and
becomes bound thereby.
7. Reimbursement of Underwriters' Expenses. If the Firm
Shares or the Additional Shares are not delivered for any reason, other than
the failure of the Underwriters to purchase the Firm Shares or the Additional
Shares as provided herein (unless such failure is permitted under the
provisions of Section 8 or Section 9(b) of this Agreement), the Company will
reimburse the Underwriters for all of their reasonable out-of-pocket expenses,
including the reasonable fees and disbursements of their counsel.
8. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters hereunder are subject to the accuracy of the
representations and warranties on the part of the Company and the Selling
Shareholders on the date hereof and at the time of purchase (and the several
obligations of the Underwriters at any additional time of purchase are subject
to the accuracy of the representations and warranties on the part of the
Company and the Selling Shareholders on the date hereof and at the time of
purchase and at such additional time of purchase, as the case may be), the
performance by each of the Company and the Selling Shareholders of its and
their obligations hereunder and to the following conditions:
(a) The Company shall furnish to you at the time of purchase
and at such additional time of purchase, as the case may be, an
opinion of ▇▇▇▇ ▇▇▇▇▇▇▇, P.C., counsel for the Company and the Selling
Shareholders, addressed to the Underwriters and dated the time of
purchase or such additional time of purchase, as the case may be, with
reproduced copies for each of the other Underwriters and in form
satisfactory to ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel for the
Underwriters, stating that:
(i) the Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Delaware, with full corporate power and
authority (A) to own its properties and conduct its business
as described in the Registration Statement and the Prospectus
and (B) to execute and deliver this Agreement and to issue,
sell and deliver the Firm Shares as herein contemplated;
(ii) each of the Material Subsidiaries has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of
16
the jurisdiction in which such Material Subsidiary is
incorporated, with full corporate power and authority to own
its properties and to conduct its business as described in
the Registration Statement and the Prospectus;
(iii) each of the Company and each of the Material
Subsidiaries is duly qualified or licensed to do business by
and is in good standing as a foreign corporation in each
jurisdiction in which it conducts business or owns property
and in which the failure, individually or in the aggregate,
to be so licensed or qualified could reasonably be expected
to have a material adverse effect on the properties, assets,
operations, business or condition (financial or other) of the
Company and the Material Subsidiaries taken as a whole;
(iv) all of the issued and outstanding shares of
capital stock of each Material Subsidiary have been duly
authorized and validly issued and are fully paid and
nonassessable and, except as set forth in the Prospectus, are
owned, directly or indirectly, by the Company free and clear
of any pledge, lien, encumbrance, security interest,
preemptive right or other claim, and, to the best of such
counsel's knowledge, there are no rights, warrants, options
or other agreements to acquire or instruments convertible
into or exchangeable for any shares of capital stock or other
equity interest of any Material Subsidiary, except as set
forth in the Prospectus;
(v) this Agreement has been duly authorized,
executed and delivered by the Company;
(vi) (a) the Shares, when delivered to and paid for
by the Underwriters, will be duly authorized, validly issued,
fully paid and nonassessable, and will be free of any pledge,
lien, encumbrance, claim or preemptive right; and (b) the
certificates for the Shares are in due and proper form and
the holders of the Shares will not be subject to personal
liability by reason of being such holders;
(vii) (a) the Company has an authorized
capitalization as set forth under the heading
"Capitalization" in the Registration Statement and the
Prospectus, and (b) the outstanding shares of capital stock
of the Company have been duly
17
authorized and validly issued and are fully paid,
nonassessable and free of statutory and contractual
preemptive rights;
(viii) the capital stock of the Company, including the
Shares, conforms in all material respects to the description
thereof contained in the Registration Statement and the
Prospectus;
(ix) the Registration Statement and the Prospectus
(except as to the financial statements and schedules
contained therein as to which such counsel need express no
opinion) comply as to form in all material respects with the
requirements of the Act;
(x) the Registration Statement has become effective
under the Act and, to the best of such counsel's knowledge,
no stop order proceedings with respect thereto are pending or
threatened under the Act;
(xi) no approval, authorization, consent or order of
or filing with any federal, state, local or foreign
governmental or regulatory commission, board, body, authority
or agency is required in connection with the issuance or sale
of the Shares as contemplated hereby other than registration
of the Shares under the Act, clearance of the offering of the
Shares with the NASD, listing the Firm Shares on the AMEX and
any necessary qualification under the securities or blue sky
laws of the various jurisdictions in which the Shares are
being offered by the Underwriters;
(xii) the execution, delivery and performance of this
Agreement by the Company, the issuance of the Firm Shares,
the sale of the Shares, the application of the net proceeds
thereof as described in the Prospectus and the consummation
by the Company of the transactions contemplated hereby do not
and will not conflict with, or result in any breach of, or
constitute a default under (nor constitute any event which
with notice, lapse of time or both would constitute a breach
of or default under), the charter or bylaws of the Company or
any of the Subsidiaries, or any material provision of any
material license, indenture, lease, mortgage, deed of trust,
bank loan or credit agreement or other agreement or
instrument to which the Company or any of the Subsidiaries is
a party or by which the Company or
18
any of the Subsidiaries or their material properties are
bound or affected, or under any federal, state, local or
foreign law, regulation or rule or any decree, judgment or
order applicable to the Company or any of the Subsidiaries;
(xiii) to the best of such counsel's knowledge,
neither the Company nor any of the Material Subsidiaries is
in breach of or in default under (nor has any event occurred
which with notice, lapse of time or both would constitute a
breach of or default under) any license, indenture, lease,
mortgage, deed of trust, bank loan or credit agreement or any
other agreement or instrument to which the Company or any of
the Material Subsidiaries is a party or by which the Company
or any of the Material Subsidiaries or their properties are
bound or affected or under any law, regulation or rule or any
decree, judgment or order applicable to the Company or any of
the Material Subsidiaries, except for such matters as could
not reasonably be expected, individually or in the aggregate,
to have a material adverse effect on the properties, assets,
operations, business or condition (financial or other) of the
Company and the Material Subsidiaries taken as a whole;
(xiv) to the best of such counsel's knowledge, the
Company and each of the Subsidiaries has such permits,
licenses, franchises and authorizations of governmental or
regulatory authorities ("permits"), including without
limitation under any applicable Environmental Laws, as are
necessary to own, lease and operate its respective properties
and to conduct its business substantially in the manner
described in the Prospectus; to the best of such counsel's
knowledge, after due inquiry, the Company and each of the
Subsidiaries has fulfilled and performed all of its material
obligations with respect to such permits and no event has
occurred which allows, or after notice or lapse of time would
allow, revocation or termination thereof or results in any
other material impairment of the rights of the holder of any
such permit, subject in each case to such qualification as
may be set forth in the Prospectus;
(xv) to the best of such counsel's knowledge, all
contracts or documents of a character required
19
to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration
Statement have been so described or filed;
(xvi) except as described in the Registration
Statement and the Prospectus, there are no actions, suits or
proceedings of which such counsel has knowledge pending or
threatened against the Company or any of the Subsidiaries, or
any of their respective properties, at law or in equity, or
before or by any federal, state, local or foreign
governmental or regulatory commission, board, body, authority
or agency that individually or in the aggregate could result
in a judgment, decree or order having a material adverse
effect on the properties, assets, operations, business or
condition (financial or other) of the Company and the
Subsidiaries taken as a whole;
(xvii) to the best of such counsel's knowledge, each
person who has the right, contractual or otherwise, to cause
the Company to register pursuant to the Act any securities of
the Company in consequence of the issue and sale of the
Shares to the Underwriters hereunder either included such
securities in the Registration Statement or duly waived such
right and each person who has the right, contractual or
otherwise, to cause the Company to issue to it any securities
of the Company in consequence of the issue and sale of the
Shares to the Underwriters hereunder has duly waived such
right;
(xviii) the statements in the Registration Statement
and the Prospectus under the captions "Business --
Regulation", "Description of Capital Stock" and "Shares
Eligible For Future Sale", insofar as they are descriptions
of laws, regulations and rules, of legal and governmental
proceedings or of contracts, agreements, leases and other
legal documents, or refer to statements of law or legal
conclusions, have been reviewed by such counsel and are
accurate in all material respects;
(xix) neither the Company nor any of the Subsidiaries
is an "investment company" or a person "controlled" by an
"investment company" within the meaning of the Investment
Company Act of 1940, as amended;
20
(xx) the sales of securities by the Company
described in Item 15 of the Registration Statement were
exempt from the registration requirements of the Act;
(xxi) the Power of Attorney and the Custody Agreement
have been duly executed and delivered by each of the Selling
Shareholders; the Power of Attorney and the Custody Agreement
are legal, valid and binding agreements of each of the
Selling Shareholders enforceable in accordance with their
respective terms, except as the enforceability thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting creditors' rights generally and
general principles of equity;
(xxii) to the best of such counsel's knowledge, each
of the Selling Shareholders has full legal right and power,
and has obtained any authorization or approval required by
law (other than those imposed by the Act and the securities
or blue sky laws of certain jurisdictions), to sell, assign,
transfer and deliver the Additional Shares to be sold by such
Selling Shareholder in the manner provided in this Agreement;
(xxiii) delivery of certificates for the Additional
Shares to be sold by the Selling Shareholders pursuant hereto
will pass title thereto to the Underwriters severally, free
and clear of any claim, lien, encumbrance, security interest,
community property right, restriction on transfer or other
defect in title assuming that the several Underwriters are
good faith purchasers and without notice of any adverse
claim;
(xxiv) to the best of such counsel's knowledge, the
consummation of the transactions contemplated hereby and by
the Power of Attorney and the Custody Agreement and the
fulfillment of the terms hereof and thereof will not
constitute a breach or violation of or default under any
trust, indenture, agreement or other instrument to which any
of the Selling Shareholders is a party or by which any of the
Selling Shareholders is bound;
(xxv) the Attorney-in-Fact has been duly authorized
by each Selling Shareholder to execute and deliver on behalf
of each Selling Shareholder this Agreement and any other
document necessary or desirable in connection with the
transactions
21
contemplated hereby and to deliver the Additional Shares to
be sold by the Selling Shareholders and receive payment
therefor pursuant hereto; and
(xxvi)nothing has come to the attention of such counsel that
causes them to believe that the Registration Statement or any
amendment thereto at the time such Registration Statement or
amendment became effective contained an untrue statement of a
material fact or omitted to state a material fact required to
be stated therein or necessary to make the statements therein
not misleading, or that the Prospectus or any supplement
thereto at the date of such Prospectus or such supplement,
and at all times up to and including the time of purchase
contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading (it
being understood that such counsel need express no opinion
with respect to the financial statements and schedules
included in the Registration Statement or Prospectus).
In rendering the foregoing opinion, ▇▇▇▇ ▇▇▇▇▇▇▇, P.C. may rely upon
the opinions of Ashurst ▇▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ as
to matters governed by United Kingdom law.
(b) You shall have received from each of Deloitte & Touche
LLP and KPMG letters dated, respectively, the date of this Agreement
and the time of purchase and additional time of purchase, as the case
may be, and addressed to the Underwriters (with reproduced copies for
each of the Underwriters) in form and substance satisfactory to you.
(c) You shall have received at the time of purchase and at
the additional time of purchase, as the case may be, opinions from
▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP in form and substance satisfactory to you.
(d) No amendment or supplement to the Registration Statement
or the Prospectus shall be filed prior to the time the Registration
Statement becomes effective to which you shall have objected in
writing.
(e) The Registration Statement shall become effective at or
before 5:00 P.M., New York City time, on the date of this Agreement
and, if Rule 430A under the Act is used, the Prospectus shall have
been filed
22
with the Commission pursuant to Rule 424(b) under the Act at or before
5:00 P.M., New York City time, on the second full business day after
the date of this Agreement; provided, however, that the Company, the
Selling Shareholders and you and any group of Underwriters, including
you, who have agreed hereunder to purchase in the aggregate at least
50% of the Firm Shares from time to time may agree in writing or by
telephone, confirmed in writing, on a later date.
(f) Prior to the time of purchase or the additional time of
purchase, as the case may be: (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued
under the Act or proceedings initiated under Section 8(d) or 8(e) of
the Act; (ii) the Registration Statement and all amendments thereto,
or modifications thereof, if any, shall not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading; and (iii) the Prospectus and all amendments or supplements
thereto, or modifications thereof, if any, shall not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.
(g) Between the time of execution of this Agreement and the
time of purchase or the additional time of purchase, as the case may
be, there has not been: (i) any material adverse change, present or
prospective, in the properties, assets, operations, business, business
prospects or condition (financial or other) of the Company and the
Subsidiaries taken as a whole, other than as described in the
Registration Statement and the Prospectus; (ii) any transaction that
is material to the Company and the Material Subsidiaries taken as a
whole contemplated or entered into by the Company or any of the
Material Subsidiaries, other than as described in the Registration
Statement and the Prospectus; or (iii) any obligation, contingent or
otherwise, directly or indirectly, incurred by the Company or any of
the Material Subsidiaries that is material to the Company and the
Material Subsidiaries taken as a whole, other than as described in the
Registration Statement and the Prospectus.
(h) The Company, at the time of purchase or additional time
of purchase, as the case may be, will
23
deliver to you a certificate of two of its executive officers to the
effect that the representations and warranties of the Company as set
forth in this Agreement are true and correct as of each such date and
the conditions set forth in Section 8(f) and Section 8(g) have been
met.
(i) You shall have received a signed letter, dated the date
of this Agreement, from each of the shareholders listed in Schedule C
to the effect that such persons shall not, directly or indirectly,
offer, sell, contract to sell, make subject to any purchase option or
otherwise dispose of or cause the disposition of any shares of Common
Stock, or any securities convertible into or exerciseable or
exchangeable for Common Stock prior to the expiration of 180 days from
the date of the effectiveness of the Registration Statement without
the prior written consent of ▇▇▇▇▇▇, Read & Co. Inc., except for
transfers to any such shareholder's spouse, child, grandchild, parent
or sibling, or to a trust for the benefit of such shareholder or any
such related person, so long as such transferee executes a copy of the
letter agreement executed by such shareholder and becomes bound
thereby.
(j) The Company and the Selling Shareholders shall have
furnished to you such other documents and certificates as to the
accuracy and completeness of any statement in the Registration
Statement or the Prospectus as of the time of purchase and the
additional time of purchase, as the case may be, as you reasonably may
request.
(k) The Company and the Selling Shareholders shall have
performed such of their respective obligations under this Agreement as
are to be performed by the terms hereof at or before the time of
purchase and at or before the additional time of purchase, as the case
may be.
(l) The Firm Shares shall have been approved for listing
on the American Stock Exchange.
(m) The Attorney-in-Fact, at the time of purchase or
additional time of purchase, as the case may be, shall have delivered
to you a certificate to the effect that the Attorney-in-Fact is not
aware that any of the representations and warranties of the Selling
Shareholders as set forth in this Agreement are not true and correct
as of such date.
24
9. Effective Date of Agreement; Termination.
(a) This Agreement shall become effective (i) if Rule 430A
under the Act is not used, when you shall have received notification of the
effectiveness of the Registration Statement, or (ii) if Rule 430A under the Act
is used, when the parties hereto have executed and delivered this Agreement.
(b) The obligations of the several Underwriters hereunder
shall be subject to termination in the absolute discretion of you or any group
of Underwriters (which may include you) which has agreed to purchase in the
aggregate at least 50% of the Firm Shares if, at any time prior to the time of
purchase or, with respect to the purchase of any Additional Shares, the
additional time of purchase, as the case may be, trading in securities on the
New York or American Stock Exchange shall have been suspended or minimum prices
shall have been established on the New York or American Stock Exchange or if a
banking moratorium shall have been declared either by the United States or New
York State authorities, or if the United States shall have declared war in
accordance with its constitutional processes or there shall have occurred any
material outbreak or escalation of hostilities or other national or
international calamity or crisis of such magnitude in its effect on, or any
material adverse change in, any financial market which, in each case, in your
judgment or in the judgment of such group of Underwriters, makes it
impracticable to market the Shares. If you or any group of Underwriters elect
to terminate this Agreement as provided in this Section 9(b), the Company and
each other Underwriter shall be notified promptly by letter or telegram.
(c) If any Underwriter shall default in its obligation to
take up and pay for the Firm Shares to be purchased by it hereunder and if the
number of Firm Shares which all Underwriters so defaulting shall have agreed
but failed to take up and pay for does not exceed 10% of the total number of
Firm Shares, the non-defaulting Underwriters shall take up and pay for (in
addition to the aggregate principal amount of Firm Shares they are obligated to
purchase pursuant to Section 1) the number of Firm Shares agreed to be
purchased by all such defaulting Underwriters as hereinafter provided. Such
Shares shall be taken up and paid for by such non-defaulting Underwriter or
Underwriters in such amount or amounts as you may designate with the consent of
each Underwriter so designated or, in the event no such designation is made,
such Shares shall be taken up and paid for by all non-defaulting Underwriters
pro rata in proportion to the aggregate number of Firm Shares set
25
opposite the names of such non-defaulting Underwriters in Schedule A.
(d) If any Underwriter shall default in its obligation to
take up and pay for the Firm Shares to be purchased by it hereunder and if the
number of Firm Shares which all Underwriters so defaulting shall have agreed
but failed to take up and pay for exceeds 10% of the total number of Firm
Shares, and arrangements satisfactory to you and the Company are not made
within 48 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter.
(e) Without relieving any defaulting Underwriter from its
obligations hereunder, the Company agrees with the non-defaulting Underwriters
that it will not sell any Firm Shares hereunder unless all of the Firm Shares
are purchased by the Underwriters (or by substituted underwriters selected by
you with the approval of the Company or selected by the Company with your
approval pursuant to Section 9(d)). If a new Underwriter or Underwriters are
substituted for a defaulting Underwriter or Underwriters in accordance with
Section 9(d), the Company or you shall have the right to postpone the time of
purchase for a period not exceeding five business days in order that any
necessary change in the Registration Statement and the Prospectus and other
documents may be effected. The term Underwriter as used in this Agreement shall
refer to and include any Underwriter substituted under this Section 9 with like
effect as if such substituted Underwriter had originally been named in Schedule
A.
(f) If the purchase of the Shares by the Underwriters, as
contemplated by this Agreement, is not consummated for any reason permitted
under this Agreement or if such purchase is not consummated because the Company
shall be unable to comply with any of the terms of this Agreement, the Company
shall not be under any obligation or liability under this Agreement (except to
the extent provided in Sections 5(l), 7 and 10), and the Underwriters shall be
under no obligation or liability to the Company under this Agreement (except to
the extent provided in Section 10).
10. Indemnity by the Company, the Selling Shareholders and\
the Underwriters.
(a) The Company and the Selling Shareholders, jointly and
severally, agree to indemnify, defend and hold harmless each Underwriter, each
person that controls any Underwriter within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act, and each Underwriter's
26
agents, employees, officers and directors and the agents, employees, officers
and directors of any such controlling person (collectively, the "Underwriter
indemnified parties") from and against any and all losses, claims, damages,
judgments, liabilities and expenses (including the fees and expenses of counsel
and other expenses in connection with investigating, defending or settling any
such action or claim) which, jointly or severally, any Underwriter indemnified
party may incur as they are incurred (and regardless of whether such
Underwriter indemnified party is a party to the litigation, if any) arising out
of or based upon any untrue statement or alleged untrue statement of a material
fact contained in the registration statement relating to the Shares or the
Prospectus or any Preliminary Prospectus, or arising out of or based upon any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, judgments, liabilities or
expenses arise out of, or are based upon, any such untrue statement or omission
or alleged untrue statement or omission based upon and in conformity with
information with respect to any Underwriter furnished in writing by any
Underwriter through you to the Company expressly for use therein with reference
to such Underwriter; provided, however, that no Selling Shareholder shall be
liable under this Section 10 in an amount exceeding the total price at which
the Shares sold by such Selling Shareholder were offered to the public. This
indemnity agreement will be in addition to any liability the Company or the
Selling Shareholders otherwise may have.
(b) If any action or proceeding (including any governmental
or regulatory investigation or proceeding) shall be brought or asserted against
any Underwriter indemnified party, with respect to which indemnity may be
sought against the Company or a Selling Shareholder pursuant to this Section
10, such Underwriter indemnified party shall promptly notify the Company and
each Selling Shareholder in writing, and the Company and the Selling
Shareholders shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to the Underwriter indemnified party and
payment of all fees and expenses; provided that the omission so to notify the
Company and the Selling Shareholders shall not relieve them from any liability
that they may have to any Underwriter indemnified party unless they are
materially prejudiced thereby. An Underwriter indemnified party shall have the
right to employ separate counsel in any such action or proceeding and to assume
the defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Underwriter indemnified party unless (i) the employment of such
counsel has been authorized in writing by the Company or the Selling
27
Shareholders, (ii) the Company and the Selling Shareholders have failed
promptly to assume the defense and employ counsel reasonably satisfactory to
the Underwriter indemnified party or (iii) the named parties to any such action
or proceeding (including any impleaded parties) include both the Underwriter
indemnified party and the Company or the Selling Shareholders and such
Underwriter indemnified party shall have reasonably concluded that there may be
one or more legal defenses available to it that are different from or
additional to those available to the Company and the Selling Shareholders (in
which case the Company and the Selling Shareholders shall not have the right to
assume the defense of such action on behalf of such Underwriter indemnified
party), in any of which events such fees and expenses shall be borne by the
Company and the Selling Shareholders and reimbursed as they are incurred. It is
understood, however, that the Company and the Selling Shareholders shall not,
in connection with any one such action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the fees and expenses of more than
one separate firm of attorneys (in addition to any local counsel) at any time
for all such Underwriter indemnified parties, which firm shall be designated in
writing by ▇▇▇▇▇▇, Read & Co. Inc., and that all such fees and expenses shall
be reimbursed as they are incurred. The Company and the Selling Shareholders
shall not be liable for any settlement of any such action effected without the
written consent of the Company or the Selling Shareholders (which consent shall
not be unreasonably withheld or delayed), but if settled with the written
consent of the Company or the Selling Shareholders, or if there is a final
judgment with respect thereto, the Company and the Selling Shareholders agree
to indemnify and hold harmless each Underwriter indemnified party from and
against any loss or liability by reason of such settlement or judgment.
(c) Each Underwriter severally agrees to indemnify and hold
harmless the Company, its directors, its officers who sign the Registration
Statement, and any person that controls the Company within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act (collectively, the
"Company indemnified parties") and each Selling Shareholder to the same extent
as the foregoing indemnity from the Company and the Selling Shareholders to the
Underwriter indemnified parties, but only with respect to information
concerning such Underwriter furnished in writing by or on behalf of such
Underwriter through you to the Company expressly for use with respect to such
Underwriter in the Registration Statement, any Preliminary Prospectus or the
Prospectus and set forth in the section of the Registration
28
Statement, any Preliminary Prospectus and the Prospectus entitled
"Underwriting." In case any action shall be brought against any Company
indemnified party or any Selling Shareholder based on the Registration
Statement, any Preliminary Prospectus or the Prospectus and in respect of which
indemnity may be sought against any Underwriter pursuant to this Section 10(c),
such Underwriter shall have the rights and duties given to the Company and the
Selling Shareholders by Section 10(b) (except that if the Company and the
Selling Shareholders shall have assumed the defense thereof such Underwriter
shall not be required to do so, but may employ separate counsel therein and
participate in the defense thereof, provided that the fees and expenses of such
separate counsel shall be at the expense of such Underwriter), and the Company
indemnified parties and the Selling Shareholders shall have the rights and
duties given to the Underwriter indemnified parties by Section 10(b).
(d) If the indemnification provided for in this Section 10 is
unavailable to or insufficient to hold harmless any Underwriter indemnified
party or any Company indemnified party or any Selling Shareholder, then the
party required to indemnify such indemnified party under this Section 10, in
lieu of indemnifying such indemnified party, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages, judgments, liabilities and expenses (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Selling Shareholders on the one hand and the Underwriters on the other hand
from the offering of the Shares, or (ii) if the allocation provided by clause
(i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company and the Selling Shareholders
on the one hand and the Underwriters on the other hand in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the Selling
Shareholders on the one hand and the Underwriters on the other hand shall be
deemed to be in the same proportion as the total proceeds from the offering
(net of underwriting discounts and commissions but before deducting expenses)
received by the Company and the Selling Shareholders bear to the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover page of the Prospectus. The
relative fault of the Company and the Selling Shareholders on the one hand and
the Underwriters on the other hand shall be determined by reference to, among
other things, whether the untrue
29
statement 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, by the Selling Shareholders or by 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, judgments, liabilities and
expenses referred to above shall be deemed to include any legal or other fees
or expenses reasonably incurred by such party in connection with investigating
or defending any claim or action.
The Company, the Selling Shareholders and the Underwriters
agree that it would not be just and equitable if contribution pursuant to this
Section 10(d) were determined by pro rata allocation or by any other method of
allocation (even if the Underwriters were treated as one entity for such
purpose) that does not take account of the equitable considerations referred to
in this Section 10(d). Notwithstanding the provisions of this Section 10(d), no
Underwriter indemnified party shall be required to contribute any amount in
excess of the amount by which the total price at which the Shares underwritten
by such Underwriter indemnified party and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
indemnified party otherwise has been required to pay by reason of such untrue
statement or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to this Section 10 are several in proportion to their
respective underwriting commitments and are not joint.
The statements under the caption "Underwriting" in the
Prospectus (to the extent such statements relate to an Underwriter) constitute
the only information furnished to the Company in writing by such Underwriter
expressly for use in the Registration Statement, any Preliminary Prospectus or
the Prospectus.
(e) The indemnity and contribution agreements contained in
this Section 10 and the representations, warranties and covenants of the
Company and the Selling Shareholders contained in this Agreement shall remain
in full force and effect, regardless of any investigation made by or on behalf
of any Underwriter indemnified party or by or on behalf of any Company
indemnified party or any Selling Shareholder, and shall survive any termination
of this
30
Agreement or the issuance and delivery of the Shares. Subject to the provisions
of Section 10(b) and Section 10(c), the Company, each Selling Shareholder and
each Underwriter agree promptly to notify the other of the commencement of any
litigation or proceeding against it in connection with the issuance and sale of
the Shares or in connection with the Registration Statement or the Prospectus.
11. Notices. Except as otherwise herein provided, all
statements, requests, notices and agreements shall be in writing or by telegram
and, if to the Underwriters, shall be sufficient in all respects if delivered
or sent to ▇▇▇▇▇▇, Read & Co. Inc., ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Attention: Syndicate Department; if to the Company, shall be sufficient
in all respects if delivered or sent to the Company at the offices of the
Company at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇; and if to the Selling Shareholders, shall be sufficient in
all respects, if delivered or sent to ____________.
12. Construction. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAW. THE SECTION HEADINGS IN THIS AGREEMENT HAVE
BEEN INSERTED AS A MATTER OF CONVENIENCE OF REFERENCE AND ARE NOT A PART OF
THIS AGREEMENT.
13. Parties in Interest. The Agreement herein set forth has
been and is made solely for the benefit of the Underwriters, the Company, the
Selling Shareholders, the Underwriter indemnified parties and the Company
indemnified parties, and their respective successors, assigns, executors and
administrators. No other person, partnership, association or corporation
(including a purchaser, as such purchaser, from any of the Underwriters) shall
acquire or have any right under or by virtue of this Agreement.
14. Counterparts. This Agreement may be signed by the
parties in counterparts which together shall constitute one and the same
agreement among the parties.
31
If the foregoing correctly sets forth the understanding among
the Company, the Selling Shareholders and the Underwriters, please so indicate
in the space provided below for such purpose, whereupon this letter and your
acceptance shall constitute a binding agreement among the Company, the Selling
Shareholders and the Underwriters, severally.
Very truly yours,
ARMOR HOLDINGS, INC.
By: __________________________
Name:
Title:
THE SELLING SHAREHOLDERS NAMED
IN SCHEDULE B ATTACHED HERETO
By: __________________________
Attorney-in-fact
Accepted and agreed to as of
the date first above written,
on behalf of themselves,
Equitable Securities Corporation
▇▇▇▇▇▇▇▇ Inc.
and the other several
Underwriters named in
Schedule A
▇▇▇▇▇▇, READ & CO. INC., as
Managing Underwriter
By: __________________________
Name:
Title:
32
SCHEDULE A
Number of
Underwriter Firm Shares
----------- -----------
▇▇▇▇▇▇, Read & Co. Inc. . . . . . . . . . . .
Equitable Securities Corporation . . . . . .
▇▇▇▇▇▇▇▇ Inc. . . . . . . . . . . . . . . .
-----------
Total
===========
33
SCHEDULE B
Number of
Additional
Name Shares to be Sold
---- -----------------
Kanders Florida Holdings Inc. 525,000
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Richmont Capital Partners I, L.P. 75,000
SCHEDULE C
SHAREHOLDERS WHO HAVE EXECUTED LOCK-UP AGREEMENTS