Initial Public Offering (IPO): Registration Statement (General Form) — Form S-1
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-1 Registration Statement (General Form) 91 437K
2: EX-1.1 Underwriting Agreement 29 134K
3: EX-3.1 Articles of Incorporation/Organization or By-Laws 24 81K
4: EX-3.2 Articles of Incorporation/Organization or By-Laws 7 22K
5: EX-3.3 Articles of Incorporation/Organization or By-Laws 16 69K
6: EX-10.1 Material Contract 21 74K
7: EX-10.2 Material Contract 13 48K
8: EX-10.5(1) Material Contract 5 21K
9: EX-10.5(2) Material Contract 5 21K
10: EX-10.5(3) Material Contract 5 21K
11: EX-10.6(1) Material Contract 68 182K
12: EX-10.6(2) Material Contract 37 107K
13: EX-10.8 Material Contract 12 53K
14: EX-21.1 Subsidiaries of the Registrant 1 6K
15: EX-23.2 Consent of Experts or Counsel 1 7K
16: EX-27.1 Financial Data Schedule (Pre-XBRL) 2 8K
Exhibit 1.1
SHARES
-------------------
HARRIS INTERACTIVE INC.
COMMON STOCK
UNDERWRITING AGREEMENT
, 1999
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LEHMAN BROTHERS INC.
U.S. BANCORP PIPER JAFFRAY INC.
VOLPE BROWN WHELAN & CO.
E*OFFERING CORP.
As Representatives of the several
Underwriters named in Schedule 1,
c/o Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
Dear Sirs:
Harris Interactive Inc., a Delaware corporation (the
"Company"), proposes to sell _________ shares (the "Firm Stock") of the
Company's common stock, par value $0.001 per share (the "Common Stock"). In
addition, the Company proposes to grant to the Underwriters named in Schedule 1
hereto (the "Underwriters") an option to purchase up to an additional _______
shares of the Common Stock on the terms and for the purposes set forth in
Section 2 (the "Option Stock"). The Firm Stock and the Option Stock, if
purchased, are hereinafter collectively called the "Stock." This is to confirm
the agreement concerning the purchase of the Stock from the Company by the
Underwriters.
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY.
The Company represents, warrants and agrees that:
(a) A registration statement on Form S-1, and the
amendments thereto, with respect to the Stock has (i) been
prepared by the Company in conformity with the requirements of
the United States Securities Act of 1933 (the "Securities
Act") and the rules and regulations (the "Rule and
Regulations") of the United States Securities and Exchange
Commission (the "Commission") thereunder, (ii) been filed with
the Commission under the Securities Act and (iii) become
effective under the Securities Act. Copies of such
registration statement, and the amendments
thereto, have been delivered by the Company to you as the
representatives (the "Representatives") of the Underwriters.
As used in this Agreement, "Effective Time" means the date and
the time as of which such registration statement, or the most
recent post-effective amendment thereto, if any, was declared
effective by the Commission; "Effective Date" means the date
of the Effective Time; "Preliminary Prospectus" means each
prospectus included in such registration statement, or
amendments thereof, before it became effective under the
Securities Act and any prospectus filed with the Commission by
the Company with the consent of the Representatives pursuant
to Rule 424(a) of the Rules and Regulations; "Registration
Statement" means such registration statement, as amended at
the Effective Time, including all information contained in the
final prospectus filed with the Commission pursuant to Rule
424(b) of the Rules and Regulations in accordance with Section
5 hereof and deemed to be a part of the registration statement
as of the Effective Time pursuant to paragraph (b) of Rule
430A of the Rules and Regulations; and "Prospectus" means such
final prospectus, as first filed with the Commission pursuant
to paragraph (1) or (4) of Rule 424(b) of the Rules and
Regulations. The Commission has not issued any order
preventing or suspending the use of any Preliminary
Prospectus.
(b) The Registration Statement conforms, and the
Prospectus and any further amendments or supplements to the
Registration Statement or the Prospectus will, when they
become effective or are filed with the Commission, as the case
may be, conform in all material respects to the requirements
of the Securities Act and the Rules and Regulations and do not
and will not, as of the applicable effective date (as to the
Registration Statement and any amendment thereto) and as of
the applicable filing date (as to the Prospectus and any
amendment or supplement thereto) contain an untrue statement
of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements
therein not misleading; PROVIDED that no representation or
warranty is made as to information contained in or omitted
from the Registration Statement or the Prospectus in reliance
upon and in conformity with written information furnished to
the Company through the Representatives by or on behalf of any
Underwriter specifically for inclusion therein.
(c) The Company and each of its subsidiaries (as
defined in Section 15) have been duly incorporated and are
validly existing as corporations in good standing under the
laws of their respective jurisdictions of incorporation, are
duly qualified to do business and are in good standing as
foreign corporations in each jurisdiction in which their
respective ownership or lease of property or the conduct of
their respective businesses requires such qualification, and
have all power and authority necessary to own or hold their
respective properties and to conduct the businesses in which
they are engaged; and each of the subsidiaries of the Company
is a "significant subsidiary", as such term is defined in Rule
405 of the Rules and Regulations.
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(d) The Company has an authorized capitalization as
set forth in the Prospectus, and all of the issued shares of
capital stock of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and
conform to the description thereof contained in the
Prospectus; and all of the issued shares of capital stock of
each subsidiary of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable
and are owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims.
(e) The shares of the Stock have been duly and
validly authorized and, when issued and delivered against
payment therefor as provided herein, will be duly and validly
issued, fully paid and non-assessable; and the Stock will
conform to the description thereof contained in the
Prospectus.
(f) This Agreement has been duly authorized, executed
and delivered by the Company.
(g) The execution, delivery and performance of this
Agreement by the Company and the consummation of the
transactions contemplated hereby will not conflict with or
result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its subsidiaries is
a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, nor will such actions
result in any violation of the provisions of the charter or
by-laws of the Company or any of its subsidiaries or any
statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the
Company or any of its subsidiaries or any of their properties
or assets; and except for the registration of the Stock under
the Securities Act and such consents, approvals,
authorizations, registrations or qualifications as may be
required under the Securities Exchange Act of 1934 (the
"Exchange Act") and applicable state securities laws in
connection with the purchase and distribution of the Stock by
the Underwriters, no consent, approval, authorization or order
of, or filing or registration with, any such court or
governmental agency or body is required for the execution,
delivery and performance of this Agreement by the Company and
the consummation of the transactions contemplated hereby.
(h) Except as set forth in the Prospectus or except
for such rights which have been waived, there are no
contracts, agreements or understandings between the Company
and any person granting such person the right to require the
Company to file a registration statement under the Securities
Act with respect to any securities of the Company owned or to
be owned by such person or to require the Company to include
such securities in the securities registered pursuant to the
Registration
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Statement or in any other registration statement filed by the
Company under the Securities Act.
(i) Except as set forth in the Registration
Statement, the Company has not sold or issued any shares of
Common Stock during the six-month period preceding the date of
the Prospectus, including any sales pursuant to Rule 144A
under, or Regulations D or S of, the Securities Act, other
than shares issued pursuant to employee benefit plans,
qualified stock options plans or other employee compensation
plans or pursuant to outstanding options, rights or warrants.
(j) Neither the Company nor any of its subsidiaries
has sustained, since the date of the latest audited financial
statements included in the Prospectus, any material loss or
interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or
decree, otherwise than as set forth or contemplated in the
Prospectus; and, since such date, there has not been any
change in the capital stock or long-term debt of the Company
or any of its subsidiaries or any material adverse change, or
any development involving a prospective material adverse
change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than
as set forth or contemplated in the Prospectus.
(k) The financial statements (including the related
notes and supporting schedules) filed as part of the
Registration Statement or included in the Prospectus present
fairly the financial condition and results of operations of
the entities purported to be shown thereby, at the dates and
for the periods indicated, and have been prepared in
conformity with generally accepted accounting principles
applied on a consistent basis throughout the periods involved.
(l) PriceWaterhouseCoopers LLP, who have certified
certain financial statements of the Company, whose report
appears in the Prospectus and who have delivered the initial
letter referred to in Section 7(f) hereof, are independent
public accountants as required by the Securities Act and the
Rules and Regulations.
(m) The Company and each of its subsidiaries have
good and marketable title to all personal property owned by
them, in each case free and clear of all liens, encumbrances
and defects except such as are described in the Prospectus or
such as do not materially affect the value of such property
and do not materially interfere with the use made and proposed
to be made of such property by the Company and its
subsidiaries; neither the Company nor any of its subsidiaries
have title to any real property in fee simple, and all real
property and buildings held under lease by the Company and its
subsidiaries are held by them under valid, subsisting and
enforceable leases, with such exceptions as are not material
and do not interfere with the use made and proposed to be made
of such property and buildings by the Company and its
subsidiaries.
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(n) The Company and each of its subsidiaries carry,
or are covered by, insurance in such amounts and covering such
risks as is adequate for the conduct of their respective
businesses and the value of their respective properties and as
is customary for companies engaged in similar businesses in
similar industries.
(o) Except as set forth in the Prospectus, the
Company and each of its subsidiaries own or possess adequate
rights to use all material patents, patent applications,
trademarks, service marks, trade names, trademark
registrations, service mark registrations, copyrights and
licenses (including with respect to software currently used by
the Company or any of its subsidiaries) necessary for the
conduct of their respective businesses and have no reason to
believe that the conduct of their respective businesses will
conflict with, and have not received any notice of any claim
of conflict with, any such rights of others.
(p) Except as described in the Prospectus, there are
no legal or governmental proceedings pending to which the
Company or any of its subsidiaries is a party or of which any
property or assets of the Company or any of its subsidiaries
is the subject which, if determined adversely to the Company
or any of its subsidiaries, might have a material adverse
effect on the consolidated financial position, stockholders'
equity, results of operations, business or prospects of the
Company and its subsidiaries; and to the best of the Company's
knowledge, no such proceedings are threatened or contemplated
by governmental authorities or threatened by others.
(q) There are no contracts or other documents which
are required to be described in the Prospectus or filed as
exhibits to the Registration Statement by the Securities Act
or by the Rules and Regulations which have not been described
in the Prospectus or filed as exhibits to the Registration
Statement or incorporated therein by reference as permitted by
the Rules and Regulations.
(r) No relationship, direct or indirect, exists
between or among the Company or its subsidiaries on the one
hand, and the directors, officers, stockholders, customers or
suppliers of the Company or its subsidiaries on the other
hand, which is required to be described in the Prospectus
which is not so described.
(s) No labor disturbance by the employees of the
Company or its subsidiaries exists or, to the knowledge of the
Company, is imminent which might be expected to have a
material adverse effect on the consolidated financial
position, stockholders' equity, results of operations,
business or prospects of the Company and its subsidiaries.
(t) The Company and its subsidiaries are in
compliance in all material respects with all presently
applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations
and published
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interpretations thereunder ("ERISA"); no "reportable event"
(as defined in ERISA) has occurred with respect to any
"pension plan" (as defined in ERISA) for which the Company or
any of its subsidiaries would have any liability; the Company
and its subsidiaries have not incurred and do not expect to
incur liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any "pension plan" or (ii)
Sections 412 or 4971 of the Internal Revenue Code of 1986, as
amended, including the regulations and published
interpretations thereunder (the "Code"); and each "pension
plan" for which the Company or any of its subsidiaries would
have any liability that is intended to be qualified under
Section 401(a) of the Code is so qualified in all material
respects and nothing has occurred, whether by action or by
failure to act, which would cause the loss of such
qualification.
(u) The Company and its subsidiaries have filed all
federal, state and local income and franchise tax returns
required to be filed through the date hereof and has paid all
taxes due thereon, and no tax deficiency has been determined
adversely to the Company or any of its subsidiaries which has
had (nor does the Company have any knowledge of any tax
deficiency which, if determined adversely to the Company or
any of its subsidiaries, might have) a material adverse effect
on the consolidated financial position, stockholders' equity,
results of operations, business or prospects of the Company
and its subsidiaries.
(v) Since the date as of which information is given
in the Prospectus through the date hereof, and except as may
otherwise be disclosed in the Prospectus, the Company and its
subsidiaries have not (i) issued or granted any securities,
(ii) incurred any liability or obligation, direct or
contingent, other than liabilities and obligations which were
incurred in the ordinary course of business, (iii) entered
into any transaction not in the ordinary course of business or
(iv) declared or paid any dividend on its capital stock.
(w) The Company and its subsidiaries (i) have made
and kept accurate books and records and (ii) have maintained
internal accounting controls which provide reasonable
assurance that (A) transactions are executed in accordance
with management's authorization, (B) transactions are recorded
as necessary to permit preparation of their respective
financial statements and to maintain accountability for their
respective assets, (C) access to their respective assets is
permitted only in accordance with management's authorization
and (D) the reported accountability for their respective
assets is compared with existing assets at reasonable
intervals.
(x) Neither the Company nor any of its subsidiaries
(i) is in violation of its charter or by-laws, (ii) is in
default in any material respect, and no event has occurred
which, with notice or lapse of time or both, would constitute
such a default, in the due performance or observance of any
term, covenant or condition contained in any material
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which it is a party or by which it
is bound or to which any of its properties or assets is
subject or (iii) is in violation in any material
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respect of any law, ordinance, governmental rule,
regulation or court decree to which it or its property or
assets may be subject or has failed to obtain any material
license, permit, certificate, franchise or other
governmental authorization or permit necessary to the
ownership of its property or to the conduct of its business.
(y) Neither the Company nor any of its subsidiaries,
nor any director, officer, agent, employee or other person
associated with or acting on behalf of the Company or any of
its subsidiaries, has used any corporate funds for any
unlawful contribution, gift, entertainment or other unlawful
expense relating to political activity; made any direct or
indirect unlawful payment to any foreign or domestic
government official or employee from corporate funds; violated
or is in violation of any provision of the Foreign Corrupt
Practices Act of 1977; or made any bribe, rebate, payoff,
influence payment, kickback or other unlawful payment.
(z) There has been no storage, disposal, generation,
manufacture, refinement, transportation, handling or treatment
of toxic wastes, medical wastes, hazardous wastes or hazardous
substances by the Company or any of its subsidiaries (or, to
the knowledge of the Company, any of their predecessors in
interest) at, upon or from any of the property now or
previously owned or leased by the Company or its subsidiaries
in violation of any applicable law, ordinance, rule,
regulation, order, judgment, decree or permit or which would
require remedial action under any applicable law, ordinance,
rule, regulation, order, judgment, decree or permit, except
for any violation or remedial action which would not have, or
could not be reasonably likely to have, singularly or in the
aggregate with all such violations and remedial actions, a
material adverse effect on the general affairs, management,
financial position, stockholders' equity or results of
operations of the Company and its subsidiaries; there has been
no material spill, discharge, leak, emission, injection,
escape, dumping or release of any kind onto such property or
into the environment surrounding such property of any toxic
wastes, medical wastes, solid wastes, hazardous wastes or
hazardous substances due to or caused by the Company or any of
its subsidiaries or with respect to which the Company or any
of its subsidiaries have knowledge, except for any such spill,
discharge, leak, emission, injection, escape, dumping or
release which would not have or would not be reasonably likely
to have, singularly or in the aggregate with all such spills,
discharges, leaks, emissions, injections, escapes, dumpings
and releases, a material adverse effect on the general
affairs, management, financial position, stockholders' equity
or results of operations of the Company and its subsidiaries;
and the terms "hazardous wastes", "toxic wastes", "hazardous
substances" and "medical wastes" shall have the meanings
specified in any applicable local, state, federal and foreign
laws or regulations with respect to environmental protection.
(aa) Neither the Company nor any subsidiary is an
"investment company" within the meaning of such term under the
Investment Company Act of 1940 and the rules and regulations
of the Commission thereunder.
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(bb) The Company and its subsidiaries have developed
a plan (the "Y2K Plan") intended to ensure that all computer
hardware and software used in and material to the business of
the Company and its subsidiaries is designed to be Year 2000
Compliant. The Y2K Plan includes reasonable steps to determine
whether the failure of any suppliers or customers with which
the Company or any of its subsidiaries has a material
relationship to be Year 2000 Compliant would have or would
reasonably be expected to have a material adverse effect on
the financial position, stockholders' equity, results of
operations, business or prospects of the Company or any of its
subsidiaries, and assuming the consummation of the Y2K Plan,
the occurrence of the calendar year 2000 will not reasonably
be expected to have a material adverse effect on the financial
position, stockholders' equity, results of operations,
business or prospects of the Company or any of its
subsidiaries. There are no issues related to the Company's or
any of its subsidiaries' preparedness to be Year 2000
Compliant that are of a character required to be described or
referred to in the Prospectus by the Securities Act that have
not been accurately described in the Prospectus. For purposes
of this section (bb), "Date Data" means any data of any kind
that consists of date information or which is otherwise
derived from, dependent on or related to date information;
"Date-Sensitive System" means any software, microcode or
hardware system or component, including any electronic or
electronically-controlled system or component that processes
any Date Data and that is installed, in development or on
order, for internal or external use, or the provision or
operation of which provides a benefit to customers, vendors,
suppliers or any other party; "Year 2000 Compliant" means (i)
with respect to Date Data, that such data is in proper format
and (ii) with respect to Date-Sensitive Systems, that each
such system accurately processes all Date Data, including for
the 20th and 21st centuries, without loss of any functionality
or performance, including, without limitation, calculating,
comparing, sequencing, storing and displaying such Date Data
(including all leap year considerations), when used as a
stand-alone system or in combination with other software or
hardware.
2. PURCHASE OF THE STOCK BY THE UNDERWRITERS. On the basis of
the representations and warranties contained in, and subject to the terms and
conditions of, this Agreement, the Company agrees to sell _______ shares of the
Firm Stock to the several Underwriters and each of the Underwriters, severally
and not jointly, agrees to purchase the number of shares of the Firm Stock set
opposite that Underwriter's name in Schedule 1 hereto. The respective purchase
obligations of the Underwriters with respect to the Firm Stock shall be rounded
among the Underwriters to avoid fractional shares, as the Representatives may
determine.
In addition, the Company grants to the Underwriters an option
to purchase up to _______ shares of Option Stock. Such option is granted for the
purpose of covering over-allotments in the sale of Firm Stock and is exercisable
as provided in Section 4 hereof. Shares of Option Stock shall be purchased
severally for the account of the Underwriters in proportion to the number of
shares of Firm Stock set forth opposite the name of such Underwriters in
Schedule 1 hereto. The respective purchase obligations of each Underwriter with
respect to the Option Stock
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shall be adjusted by the Representatives so that no Underwriter shall be
obligated to purchase Option Stock other than in 100 share amounts. The price of
both the Firm Stock and any Option Stock shall be $_____ per share.
The Company shall not be obligated to deliver any of the Stock
to be delivered on any Delivery Date (as hereinafter defined), as the case may
be, except upon payment for all the Stock to be purchased on such Delivery Date
as provided herein.
3. OFFERING OF STOCK BY THE UNDERWRITERS.
Upon authorization by the Representatives of the release of
the Firm Stock, the several Underwriters propose to offer the Firm Stock for
sale upon the terms and conditions set forth in the Prospectus.
It is understood that _______ shares of the Firm Stock will
initially be reserved by the several Underwriters for offer and sale upon the
terms and conditions set forth in the Prospectus and in accordance with the
rules and regulations of the National Association of Securities Dealers, Inc. to
employees and certain persons having business relationships or who are
"cooperative respondents" (as described in the Prospectus) who have heretofore
delivered to the Representatives offers or indications of interest to purchase
shares of Firm Stock in form satisfactory to the Representatives, and that any
allocation of such Firm Stock among such persons will be made in accordance with
timely directions received by the Representatives from the Company; PROVIDED,
that under no circumstances will the Representatives or any Underwriter be
liable to the Company or to any such person for any action taken or omitted in
good faith in connection with such offering to employees and persons having
business relationships with the Company and its subsidiaries. It is further
understood that any shares of such Firm Stock which are not purchased by such
persons will be offered by the Underwriters to the public upon the terms and
conditions set forth in the Prospectus.
4. DELIVERY OF AND PAYMENT FOR THE STOCK. Delivery of and
payment for the Firm Stock shall be made at the New York office of O'Melveny &
Myers LLP, at 10:00 A.M., New York City time, on the fourth full business day
following the date of this Agreement or at such other date or place as shall be
determined by agreement between the Representatives and the Company. This date
and time are sometimes referred to as the First Delivery Date." On the First
Delivery Date, the Company shall deliver or cause to be delivered certificates
representing the Firm Stock to the Representatives for the account of each
Underwriter against payment to or upon the order of the Company of the purchase
price by wire transfer in immediately available funds. Time shall be of the
essence, and delivery at the time and place specified pursuant to this Agreement
is a further condition of the obligation of each Underwriter hereunder. Upon
delivery, the Firm Stock shall be registered in such names and in such
denominations as the Representatives shall request in writing not less than two
full business days prior to the First Delivery Date. For the purpose of
expediting the checking and packaging of the certificates for the Firm Stock,
the Company shall make the certificates representing the Firm Stock available
for inspection by the Representatives in New York, New York, not later than 2:00
P.M., New York City time, on the business day prior to the First Delivery Date.
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The option granted in Section 2 will expire 30 days after the
date of this Agreement and may be exercised in whole or in part from time to
time by written notice being given to the Company by the Representatives. Such
notice shall set forth the aggregate number of shares of Option Stock as to
which the option is being exercised, the names in which the shares of Option
Stock are to be registered, the denominations in which the shares of Option
Stock are to be issued and the date and time, as determined by the
Representatives, when the shares of Option Stock are to be delivered; PROVIDED,
HOWEVER, that this date and time shall not be earlier than the First Delivery
Date nor earlier than the second business day after the date on which the option
shall have been exercised nor later than the fifth business day after the date
on which the option shall have been exercised. The date and time the shares of
Option Stock are delivered are sometimes referred to as a "Second Delivery Date"
and the First Delivery Date and any Second Delivery Date are sometimes each
referred to as a "Delivery Date".
Delivery of and payment for the Option Stock shall be made at
the place specified in the first sentence of the first paragraph of this Section
4 (or at such other place as shall be determined by agreement between the
Representatives and the Company) at 10:00 A.M., New York City time, on such
Second Delivery Date. On such Second Delivery Date, the Company shall deliver or
cause to be delivered the certificates representing the Option Stock to the
Representatives for the account of each Underwriter against payment to or upon
the order of the Company of the purchase price by wire transfer in immediately
available funds. Time shall be of the essence, and delivery at the time and
place specified pursuant to this Agreement is a further condition of the
obligation of each Underwriter hereunder. Upon delivery, the Option Stock shall
be registered in such names and in such denominations as the Representatives
shall request in the aforesaid written notice. For the purpose of expediting the
checking and packaging of the certificates for the Option Stock, the Company
shall make the certificates representing the Option Stock available for
inspection by the Representatives in New York, New York, not later than 2:00
P.M., New York City time, on the business day prior to such Second Delivery
Date.
5. FURTHER AGREEMENTS OF THE COMPANY. The Company agrees:
(a) To prepare the Prospectus in a form approved by
the Representatives and to file such Prospectus pursuant to
Rule 424(b) under the Securities Act not later than
Commission's close of business on the second business day
following the execution and delivery of this Agreement or, if
applicable, such earlier time as may be required by Rule
430A(a)(3) under the Securities Act; to make no further
amendment or any supplement to the Registration Statement or
to the Prospectus except as permitted herein; to advise the
Representatives, promptly after it receives notice thereof, of
the time when any amendment to the Registration Statement has
been filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed and to
furnish the Representatives with copies thereof; to advise the
Representatives, promptly after it receives notice thereof, of
the issuance by the Commission of any stop order or of any
order preventing or suspending the use of any Preliminary
Prospectus or the Prospectus, of the suspension of the
qualification of the Stock for offering or sale in any
jurisdiction,
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of the initiation or threatening of any proceeding for any
such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or the
Prospectus or for additional information; and, in the event of
the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or the
Prospectus or suspending any such qualification, to use
promptly its best efforts to obtain its withdrawal;
(b) To furnish promptly to each of the
Representatives and to counsel for the Underwriters a signed
copy of the Registration Statement as originally filed with
the Commission, and each amendment thereto filed with the
Commission, including all consents and exhibits filed
therewith;
(c) To deliver promptly to the Representatives such
number of the following documents as the Representatives shall
reasonably request: (i) conformed copies of the Registration
Statement as originally filed with the Commission and each
amendment thereto (in each case excluding exhibits other than
this Agreement and (ii) each Preliminary Prospectus, the
Prospectus and any amended or supplemented Prospectus; and, if
the delivery of a prospectus is required at any time after the
Effective Time in connection with the offering or sale of the
Stock or any other securities relating thereto and if at such
time any events shall have occurred as a result of which the
Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made when such Prospectus is delivered, not misleading,
or, if for any other reason it shall be necessary to amend or
supplement the Prospectus in order to comply with the
Securities Act, to notify the Representatives and, upon their
request, to file such document and to prepare and furnish
without charge to each Underwriter and to any dealer in
securities as many copies as the Representatives may from time
to time reasonably request of an amended or supplemented
Prospectus which will correct such statement or omission or
effect such compliance.
(d) To file promptly with the Commission any
amendment to the Registration Statement or the Prospectus or
any supplement to the Prospectus that may, in the judgment of
the Company or the Representatives, be required by the
Securities Act or requested by the Commission;
(e) Prior to filing with the Commission any amendment
to the Registration Statement or supplement to the Prospectus
or any Prospectus pursuant to Rule 424 of the Rules and
Regulations, to furnish a copy thereof to the Representatives
and counsel for the Underwriters and obtain the consent of the
Representatives to the filing;
(f) As soon as practicable after the Effective Date,
to make generally available to the Company's security holders
and to deliver to the Representatives an earnings statement of
the Company and its subsidiaries (which need not be audited)
11
complying with Section 11(a) of the Securities Act and the
Rules and Regulations (including, at the option of the
Company, Rule 158);
(g) For a period of five years following the
Effective Date, to furnish to the Representatives copies of
all materials furnished by the Company to its shareholders and
all public reports and all reports and financial statements
furnished by the Company to the principal national securities
exchange upon which the Common Stock may be listed pursuant to
requirements of or agreements with such exchange or to the
Commission pursuant to the Exchange Act or any rule or
regulation of the Commission thereunder;
(h) Promptly from time to time to take such action as
the Representatives may reasonably request to qualify the
Stock for offering and sale under the securities laws of such
jurisdictions as the Representatives may request and to comply
with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be
necessary to complete the distribution of the Stock; PROVIDED
that in connection therewith the Company shall not be required
to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
(i) For a period of 180 days from the date of the
Prospectus, not to, directly or indirectly, (1) offer for
sale, sell, pledge or otherwise dispose of (or enter into any
transaction or device which is designed to, or could be
expected to, result in the disposition by any person at any
time in the future of) any shares of Common Stock or
securities convertible into or exchangeable for Common Stock
(other than the Stock and shares issued pursuant to employee
benefit plans, qualified stock option plans or other employee
compensation plans existing on the date hereof or pursuant to
currently outstanding options, warrants or rights), or sell or
grant options, rights or warrants with respect to any shares
of Common Stock or securities convertible into or exchangeable
for Common Stock (other than the grant of options pursuant to
option plans existing on the date hereof), or (2) enter into
any swap or other derivatives transaction that transfers to
another, in whole or in part, any of the economic benefits or
risks of ownership of such shares of Common Stock, whether any
such transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or other securities, in
cash or otherwise, in each case without the prior written
consent of Lehman Brothers Inc.; and to cause each officer and
director of the Company and each of their family members who
are stockholders of the Company to furnish to the
Representatives, prior to the First Delivery Date, a letter or
letters, in form and substance satisfactory to counsel for the
Underwriters, pursuant to which each such person shall agree
not to, directly or indirectly, (1) offer for sale, sell,
pledge or otherwise dispose of (or enter into any transaction
or device which is designed to, or could be expected to,
result in the disposition by any person at any time in the
future of) any shares of Common Stock or securities
convertible into or exchangeable for Common Stock that they
own or may thereafter acquire or (2) enter into any swap or
other derivatives transaction that transfers to another, in
12
whole or in part, any of the economic benefits or risks of
ownership of such shares of Common Stock, whether any such
transaction described in clause (1) or (2) above is to be
settled by delivery of Common Stock or other securities, in
cash or otherwise, in each case for a period of 180 days from
the date of the Prospectus, without the prior written consent
of Lehman Brothers Inc.;
(j) Prior to the Effective Date, to apply for the
listing of the Stock on the Nasdaq National Market and to use
its best efforts to complete that listing, subject only to
official notice of issuance and evidence of satisfactory
distribution, prior to the First Delivery Date;
(k) Prior to filing with the Commission its first
periodic report pursuant to Section 13(a) or 15(d) of the
Securities Act that includes information required pursuant to
Rule 463 of the Rules and Regulations, to furnish a copy
thereof to the counsel for the Underwriters and receive and
consider its comments thereon, and to deliver promptly to the
Representatives a copy of such report filed by it with the
Commission;
(l) To apply the net proceeds from the sale of the
Stock being sold by the Company as set forth in the
Prospectus;
(m) To take such steps as shall be necessary to
ensure that neither the Company nor any subsidiary shall
become an "investment company" within the meaning of such term
under the Investment Company Act of 1940 and the rules and
regulations of the Commission thereunder; and
(n) To cause each current holder of preferred
stock and certain other holders of common stock of the
Company to execute and deliver prior to the First Delivery
Date an agreement, in form and substance satisfactory to
counsel for the Underwriters, stating that, without the
prior written consent of Lehman Brothers Inc., such holder
of capital stock will not, directly or indirectly, (1)
offer for sale, sell, pledge, or otherwise dispose of (or
enter into any transaction or device that is designed to,
or could reasonably be expected to, result in the
disposition by any person at any time in the future of) any
shares of Common Stock (including, without limitation,
shares of Common Stock that may be deemed to be
beneficially owned by such current stockholder in
accordance with the rules and regulations of the Securities
and Exchange Commission and shares of Common Stock that may
be issued upon exercise of any option or warrant) or
securities convertible into or exchangeable for Common
Stock owned by such holder on the date of the completion of
the offering or thereafter acquired, or (2) enter into any
swap or other derivatives transaction that transfers to
another, in whole or in part, any of the economic benefits
or risks of ownership of such shares of Common Stock,
whether any such transaction described in clause (1) or (2)
above is to be settled by delivery of Common Stock or other
securities, in cash or otherwise for a period of 180 days
after the date of the final Prospectus relating to the
Offering.
13
6. EXPENSES. The Company agrees to pay (a) the costs incident
to the authorization, issuance, sale and delivery of the Stock and any taxes
payable in that connection; (b) the costs incident to the preparation, printing
and filing under the Securities Act of the Registration Statement and any
amendments and exhibits thereto; (c) the costs of distributing the Registration
Statement as originally filed and each amendment thereto and any post-effective
amendments thereof (including, in each case, exhibits), any Preliminary
Prospectus, the Prospectus and any amendment or supplement to the Prospectus,
all as provided in this Agreement; (d) the costs of producing and distributing
this Agreement and any other related documents in connection with the offering,
purchase, sale and delivery of the stock; (e) the filing fees incident to
securing any required review by the National Association of Securities Dealers,
Inc. of the terms of sale of the Stock; (g) any applicable listing or other
fees; (h) the fees and expenses of qualifying the Stock under the securities
laws of the several jurisdictions as provided in Section 5(h) and of preparing,
printing and distributing a Blue Sky Memorandum (including related fees and
expenses of counsel to the Underwriters); (j) all costs and expenses of the
Underwriters, including the fees and disbursements of counsel for the
Underwriters, incident to the offer and sale of shares of the Stock by the
Underwriters to "cooperative respondents", employees and other persons having
business relationships with the Company and its subsidiaries, as described in
Section 3; (k) all travel and lodging expenses of the Company's personnel in
connection with the roadshow as part of the offering of the Stock; and (l) all
other costs and expenses incident to the performance of the obligations of the
Company under this Agreement; PROVIDED that, except as provided in this Section
6 and in Section 11 the Underwriters shall pay their own costs and expenses,
including the costs and expenses of their counsel, any transfer taxes on the
Stock which they may sell and the expenses of advertising any offering of the
Stock made by the Underwriters.
7. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The respective
obligations of the Underwriters hereunder are subject to the accuracy, when made
and on each Delivery Date, of the representations and warranties of the Company
contained herein, to the performance by the Company of its obligations
hereunder, and to each of the following additional terms and conditions:
(a) The Prospectus shall have been timely filed with
the Commission in accordance with Section 5; no stop order
suspending the effectiveness of the Registration Statement or
any part thereof shall have been issued and no proceeding for
that purpose shall have been initiated or threatened by the
Commission; and any request of the Commission for inclusion of
additional information in the Registration Statement or the
Prospectus or otherwise shall have been complied with.
(b) No Underwriter shall have discovered and
disclosed to the Company on or prior to such Delivery Date
that the Registration Statement or the Prospectus or any
amendment or supplement thereto contains an untrue statement
of a fact which, in the opinion of O'Melveny & Myers LLP,
counsel for the Underwriters, is material or omits to state a
fact which, in the opinion of such counsel, is material and is
required to be stated therein or is necessary to make the
statements therein not misleading.
14
(c) All corporate proceedings and other legal matters
incident to the authorization, form and validity of this
Agreement, the Stock, the Registration Statement and the
Prospectus, and all other legal matters relating to this
Agreement and the transactions contemplated hereby shall be
reasonably satisfactory in all material respects to counsel
for the Underwriters, and the Company shall have furnished to
such counsel all documents and information that they may
reasonably request to enable them to pass upon such matters.
(d) Harris Beach & Wilcox, LLP shall have furnished
to the Representatives their written opinion, as counsel to
the Company, addressed to the Underwriters and dated such
Delivery Date, in form and substance reasonably satisfactory
to the Representatives, to the effect that:
(i) The Company and each of its subsidiaries
have been duly incorporated and are validly existing
as corporations in good standing under the laws of
their respective jurisdictions of incorporation, are
duly qualified to do business and are in good
standing as foreign corporations in each jurisdiction
in which their respective ownership or lease of
property or the conduct of their respective
businesses requires such qualification and have all
power and authority necessary to own or hold their
respective properties and conduct their respective
businesses in which they are engaged;
(ii) The Company has an authorized
capitalization as set forth in the Prospectus, and
all of the issued shares of capital stock of the
Company (including the shares of Stock being
delivered on such Delivery Date) have been duly and
validly authorized and issued, are fully paid and
non-assessable and conform to the description thereof
contained in the Prospectus; and all of the issued
shares of capital stock of each subsidiary of the
Company have been duly and validly authorized and
issued and are fully paid, non-assessable and are
owned directly or indirectly by the Company, free and
clear of all liens, encumbrances, equities or claims;
(iii) There are no preemptive or other rights
to subscribe for or to purchase, nor any restriction
upon the voting or transfer of, any shares of the
Stock pursuant to the Company's charter or by-laws or
any agreement or other instrument known to such
counsel;
(iv) Neither the Company nor any of its
subsidiaries have title to any real property in fee
simple, and all real property and buildings held
under lease by the Company and its subsidiaries are
held by them under valid, subsisting and enforceable
leases, with such exceptions as are not material and
do not interfere with the use made and proposed to be
made of such property and buildings by the Company
and its subsidiaries;
15
(v) Other than as set forth in the
Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of
its subsidiaries is a party or of which any property
or assets of the Company or any of its subsidiaries
is the subject which, if determined adversely to the
Company or any of its subsidiaries, might have a
material adverse effect on the consolidated financial
position, stockholders' equity, results of
operations, business or prospects of the Company and
its subsidiaries; and, to the best of such counsel's
knowledge, no such proceedings are threatened or
contemplated by governmental authorities or
threatened by others;
(vi) The Registration Statement was declared
effective under the Securities Act as of the date and
time specified in such opinion, the Prospectus was
filed with the Commission pursuant to the
subparagraph of Rule 424(b) of the Rules and
Regulations specified in such opinion on the date
specified therein and no stop order suspending the
effectiveness of the Registration Statement has been
issued and, to the knowledge of such counsel, no
proceeding for that purpose is pending or threatened
by the Commission;
(vii) The Registration Statement and the
Prospectus and any further amendments or supplements
thereto made by the Company prior to such Delivery
Date (other than the financial statements and related
schedules therein, as to which such counsel need
express no opinion) comply as to form in all material
respects with the requirements of the Securities Act
and the Rules and Regulations;
(viii) The statements made in the Prospectus
under the caption "Description of Capital Stock",
insofar as they purport to constitute a summary of
the terms of such capital stock, constitute an
accurate summary thereof in all material respects.
(ix) To the best of such counsel's knowledge,
there are no contracts or other documents which are
required to be described in the Prospectus or filed
as exhibits to the Registration Statement by the
Securities Act or by the Rules and Regulations which
have not been described or filed as exhibits to the
Registration Statement;
(x) This Agreement has been duly authorized,
executed and delivered by the Company;
(xi) The issue and sale of the shares of
Stock being delivered on such Delivery Date by the
Company and the compliance by the Company with all of
the provisions of this Agreement will not conflict
with or result in a breach or violation of any of the
terms or provisions of, or constitute a
16
default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or
instrument known to such counsel to which the Company
or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries is bound or to
which any of the property or assets of the Company or
any of its subsidiaries is subject, nor will such
actions result in any violation of the provisions of
the charter or by-laws of the Company or any of its
subsidiaries or any statute or any order, rule or
regulation known to such counsel of any court or
governmental agency or body having jurisdiction over
the Company or any of its subsidiaries or any of
their properties or assets; and, except for the
registration of the Stock under the Securities Act
and such consents, approvals, authorizations,
registrations or qualifications as may be required
under the Exchange Act and applicable state
securities laws in connection with the purchase and
distribution of the Stock by the Underwriters, no
consent, approval, authorization or order of, or
filing or registration with, any such court or
governmental agency or body is required for the
execution, delivery and performance of this Agreement
by the Company and the consummation of the
transactions contemplated hereby; and
(xii) To the best of such counsel's knowledge,
there are no contracts, agreements or understandings
between the Company and any person granting such
person the right (other than rights which have been
waived or satisfied) to require the Company to file a
registration statement under the Securities Act with
respect to any securities of the Company owned or to
be owned by such person or to require the Company to
include such securities in the securities registered
pursuant to the Registration Statement or in any
securities being registered pursuant to any other
registration statement filed by the Company under the
Securities Act.
In rendering such opinion, such counsel may (i) state that
their opinion is limited to matters governed by the Federal
laws of the United States of America, the laws of the State of
New York and the General Corporation Law of the State of
Delaware and that such counsel is not admitted in the State of
Delaware and (ii) rely (to the extent such counsel deems
proper and specifies in their opinion), as to matters
involving the application of the laws of the State of Ohio
upon the opinion of other counsel of good standing, PROVIDED
that such other counsel is satisfactory to counsel for the
Underwriters and furnishes a copy of its opinion to the
Representatives. Such counsel shall also have furnished to the
Representatives a written statement, addressed to the
Underwriters and dated such Delivery Date, in form and
substance satisfactory to the Representatives, to the effect
that (x) such counsel has acted as counsel to the Company on a
regular basis, has acted as counsel to the Company in
connection with previous financing transactions and has acted
as counsel to the Company in connection with the preparation
of the Registration Statement, and (y) based on the foregoing,
no facts have come to the attention of such counsel which
17
lead them to believe that the Registration Statement (other
than the financial statements, financial data and related
schedules, as to which such counsel need express no opinion),
as of the Effective Date, contained any untrue statement of a
material fact or omitted to state a material fact required to
be stated therein or necessary in order to make the statements
therein not misleading, or that the Prospectus contains any
untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary in
order to make the statements therein, in light of the
circumstances under which they were made, not misleading when
they were filed with the Commission. The foregoing opinion and
statement may be qualified by a statement to the effect that
such counsel does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained
in the Registration Statement or the Prospectus except for the
statements made in the Prospectus under the caption,
"Description of Capital Stock", insofar as such statements
relate to the Stock and concern legal matters.
(e) The Representatives shall have received from
O'Melveny & Myers LLP, counsel for the Underwriters, such
opinion or opinions, dated such Delivery Date, with respect to
the issuance and sale of the Stock, the Registration
Statement, the Prospectus and other related matters as the
Representatives may reasonably require, and the Company shall
have furnished to such counsel such documents as they
reasonably request for the purpose of enabling them to pass
upon such matters.
(f) At the time of execution of this Agreement, the
Representatives shall have received from
PriceWaterhouseCoopers LLP a letter, in form and substance
satisfactory to the Representatives, addressed to the
Underwriters and dated the date hereof (i) confirming that
they are independent public accountants within the meaning of
the Securities Act and are in compliance with the applicable
requirements relating to the qualification of accountants
under Rule 2-01 of Regulation S-X of the Commission, (ii)
stating, as of the date hereof (or, with respect to matters
involving changes or developments since the respective dates
as of which specified financial information is given in the
Prospectus, as of a date not more than five days prior to the
date hereof), the conclusions and findings of such firm with
respect to the financial information and other matters
ordinarily covered by accountants' "comfort letters" to
underwriters in connection with registered public offerings.
(g) With respect to the letter of
PriceWaterhouseCoopers LLP referred to in the preceding
paragraph and delivered to the Representatives concurrently
with the execution of this Agreement (the "Initial Letter"),
the Company shall have furnished to the Representatives a
letter (the "Bring-Down Letter") of such accountants,
addressed to the Underwriters and dated such Delivery Date (i)
confirming that they are independent public accountants within
the meaning of the Securities Act and are in compliance with
the applicable requirements relating to the qualification of
accountants under Rule 2-01 of Regulation S-X of the
Commission, (ii) stating, as of the date of the bring-down
letter (or, with respect to matters involving changes or
18
developments since the respective dates as of which specified
financial information is given in the Prospectus, as of a date
not more than five days prior to the date of the bring-down
letter), the conclusions and findings of such firm with
respect to the financial information and other matters covered
by the initial letter and (iii) confirming in all material
respects the conclusions and findings set forth in the initial
letter.
(h) The Company shall have furnished to the
Representatives a certificate, dated such Delivery Date, of
its Chairman of the Board, its Chief Executive Officer, its
President or a Vice President and its chief financial officer
stating that:
(i) The representations, warranties and
agreements of the Company in Section 1 are true and
correct as of such Delivery Date; the Company has
complied with all its agreements contained herein;
and the conditions set forth in Sections 7 (a)
through 7(m) have been fulfilled; and
(ii) They have carefully examined the
Registration Statement and the Prospectus and, in
their opinion (A) as of the Effective Date, the
Registration Statement and Prospectus did not include
any untrue statement of a material fact and did not
omit to state a material fact required to be stated
therein or necessary to make the statements therein
not misleading, and (B) since the Effective Date no
event has occurred which should have been set forth
in a supplement or amendment to the Registration
Statement or the Prospectus.
(i) (i) Neither the Company nor any of its
subsidiaries shall have sustained since the date of the latest
audited financial statements included in the Prospectus any
loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance,
or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated
in the Prospectus or (ii) since such date there shall not have
been any change in the capital stock or long-term debt of the
Company or any of its subsidiaries or any change, or any
development involving a prospective change, in or affecting
the general affairs, management, financial position,
stockholders' equity or results of operations of the Company
and its subsidiaries, otherwise than as set forth or
contemplated in the Prospectus, the effect of which, in any
such case described in clause (i) or (ii), is, in the judgment
of the Representatives, so material and adverse as to make it
impracticable or inadvisable to proceed with the public
offering or the delivery of the Stock being delivered on such
Delivery Date on the terms and in the manner contemplated in
the Prospectus.
(k) Subsequent to the execution and delivery of this
Agreement there shall not have occurred any of the following:
(i) trading in securities generally on the New York Stock
Exchange or the American Stock Exchange or in the
over-the-counter market, or trading in any securities of the
Company on any exchange or in
19
the over-the-counter market, shall have been suspended or
minimum prices shall have been established on any such
exchange or such market by the Commission, by such exchange or
by any other regulatory body or governmental authority having
jurisdiction, (ii) a banking moratorium shall have been
declared by Federal or state authorities, (iii) the United
States shall have become engaged in hostilities, there shall
have been an escalation in hostilities involving the United
States or there shall have been a declaration of a national
emergency or war by the United States or (iv) there shall have
occurred such a material adverse change in general economic,
political or financial conditions (or the effect of
international conditions on the financial markets in the
United States shall be such) as to make it, in the judgment of
a majority in interest of the several Underwriters,
impracticable or inadvisable to proceed with the public
offering or delivery of the Stock being delivered on such
Delivery Date on the terms and in the manner contemplated in
the Prospectus.
(l) The Nasdaq National Market shall have approved
the Stock for listing, subject only to official notice of
issuance and evidence of satisfactory distribution.
(m) The Company shall have furnished to the
Representatives such further information, certificates and
documents as they may reasonably request, including without
limitation a report by an independent consulting firm
confirming that the Company's computer hardware and software
are Year 2000 Compliant.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Underwriters.
8. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company and each of its subsidiaries jointly and
severally, shall indemnify and hold harmless each Underwriter, its officers and
employees and each person, if any, who controls any Underwriter within the
meaning of the Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof (including, but
not limited to, any loss, claim, damage, liability or action relating to
purchases and sales of Stock), to which that Underwriter, officer, employee or
controlling person may become subject, under the Securities Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus or in any amendment or supplement thereto, (ii) the omission or
alleged omission to state in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or in any amendment or supplement thereto, or in
any Blue Sky Application any material fact required to be stated therein or
necessary to make the statements therein not misleading or (iii) any act or
failure to act or any alleged act or failure to act by any Underwriter in
connection with, or relating in any manner to, the Stock or the offering
contemplated hereby, and which is included as part of or referred to in any
loss, claim, damage, liability or action arising out of or based upon matters
covered by clause (i) or (ii) above (PROVIDED that neither the Company nor any
of its subsidiaries shall be liable under this clause (iii) to the extent that
it is determined in a final judgment by a court of competent jurisdiction that
such loss, claim, damage, liability or action resulted directly from any such
acts or failures to act undertaken
20
or omitted to be taken by such Underwriter through its gross negligence or
willful misconduct), and shall reimburse each Underwriter and each such officer,
employee or controlling person promptly upon demand for any legal or other
expenses reasonably incurred by that Underwriter, officer, employee or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred; PROVIDED, HOWEVER, that neither the Company nor any of
its subsidiaries shall be liable in any such case to the extent that any such
loss, claim, damage, liability or action arises out of, or is based upon, any
untrue statement or alleged untrue statement or omission or alleged omission
made in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or in any such amendment or supplement, in reliance upon and in
conformity with written information concerning such Underwriter furnished to the
Company through the Representatives by or on behalf of any Underwriter
specifically for inclusion therein which information consists solely of the
information specified in Section 8(e). The foregoing indemnity agreement is in
addition to any liability which the Company or any of its subsidiaries may
otherwise have to any Underwriter or to any officer, employee or controlling
person of that Underwriter.
(b) Each Underwriter, severally and not jointly, shall
indemnify and hold harmless the Company, its officers and employees, each of its
directors, and each person, if any, who controls the Company within the meaning
of the Securities Act, from and against any loss, claim, damage or liability,
joint or several, or any action in respect thereof, to which the Company or any
such director, officer or controlling person may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained (A) in any Preliminary Prospectus,
the Registration Statement or the Prospectus or in any amendment or supplement
thereto, or (B) in any Blue Sky Application or (ii) the omission or alleged
omission to state in any Preliminary Prospectus, the Registration Statement or
the Prospectus, or in any amendment or supplement thereto, or in any Blue Sky
Application any material fact required to be stated therein or necessary to make
the statements therein not misleading, but in each case only to the extent that
the untrue statement or alleged untrue statement or omission or alleged omission
was made in reliance upon and in conformity with written information concerning
such Underwriter furnished to the Company through the Representatives by or on
behalf of that Underwriter specifically for inclusion therein, and shall
reimburse the Company and any such director, officer or controlling person for
any legal or other expenses reasonably incurred by the Company or any such
director, officer or controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action as such expenses are incurred. The foregoing indemnity agreement is in
addition to any liability which any Underwriter may otherwise have to the
Company or any such director, officer, employee or controlling person.
(c) Promptly after receipt by an indemnified party under
this Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; PROVIDED, HOWEVER,
that the failure to notify the indemnifying party shall not relieve it from
any liability which it may have under this Section 8 except to the extent it
has been materially prejudiced by such failure and, PROVIDED FURTHER, that
the failure to notify the indemnifying party shall not relieve it from any
21
liability which it may have to an indemnified party otherwise than under this
Section 8. If any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein and, to the
extent that it wishes, jointly with any other similarly notified indemnifying
party, to assume the defense thereof with counsel reasonably satisfactory to
the indemnified party. After notice from the indemnifying party to the
indemnified party of its election to assume the defense of such claim or
action, the indemnifying party shall not be liable to the indemnified party
under this Section 8 for any legal or other expenses subsequently incurred by
the indemnified party in connection with the defense thereof other than
reasonable costs of investigation; PROVIDED, HOWEVER, that the
Representatives shall have the right to employ counsel to represent jointly
the Representatives and those other Underwriters and their respective
officers, employees and controlling persons who may be subject to liability
arising out of any claim in respect of which indemnity may be sought by the
Underwriters against the Company or any of its subsidiaries under this
Section 8 if, in the reasonable judgment of the Representatives, it is
advisable for the Representatives and those Underwriters, officers, employees
and controlling persons to be jointly represented by separate counsel, and in
that event the fees and expenses of such separate counsel shall be paid by
the Company and its subsidiaries. No indemnifying party shall (i) without the
prior written consent of the indemnified parties (which consent shall not be
unreasonably withheld), settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or
consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding, or (ii) be
liable for any settlement of any such action effected without its written
consent (which consent shall not be unreasonably withheld), but if settled
with the consent of the indemnifying party or if there be a final judgment of
the plaintiff in any such action, the indemnifying party agrees to indemnify
and hold harmless any indemnified party from and against any loss or
liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 8
shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 8(a) or 8(b) in respect of any loss, claim,
damage or liability, or any action in respect thereof, referred to therein, then
each indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company and its subsidiaries, on the one hand and the
Underwriters on the other from the offering of the Stock or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and
its subsidiaries on the one hand and the Underwriters on the other with respect
to the statements or omissions which resulted in such loss, claim, damage or
liability, or action in respect thereof, as well as any other relevant equitable
considerations. The relative benefits received by the Company and its
subsidiaries on the one hand and the Underwriters on the other with respect to
such offering shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Stock purchased under this Agreement (before
deducting expenses) received by the Company and its
22
subsidiaries, on the one hand, and the total underwriting discounts and
commissions received by the Underwriters with respect to the shares of the Stock
purchased under this Agreement, on the other hand, bear to the total gross
proceeds from the offering of the shares of the Stock under this Agreement, in
each case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to whether the untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company and its
subsidiaries or the Underwriters, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission. For purposes of the preceding two sentences, the net
proceeds deemed to be received by the Company shall be deemed to be also for the
benefit of each of its subsidiaries and information supplied by the Company
shall also be deemed to have been supplied by each of its subsidiaries. The
Company, each of its subsidiaries and the Underwriters agree that it would not
be just and equitable if contributions pursuant to this Section were to be
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take into account the equitable considerations referred to herein. The amount
paid or payable by an indemnified party as a result of the loss, claim, damage
or liability, or action in respect thereof, referred to above in this Section
shall be deemed to include, for purposes of this Section 8(d), any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8(d), no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the Stock
underwritten by it and distributed to the public was offered to the public
exceeds the amount of any damages which such Underwriter has otherwise paid or
become liable to pay by reason of any untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 8(e) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as provided in
this Section 8(d) are several in proportion to their respective underwriting
obligations and not joint.
(e) The Underwriters severally confirm and the Company and its
subsidiaries acknowledge that the statements with respect to the public offering
of the Stock by the Underwriters set forth on the cover page of, the legend
concerning over-allotments on the inside front cover page of and the concession
and reallowance figures appearing under the caption "Underwriting" in, the
Prospectus are correct and constitute the only information concerning such
Underwriters furnished in writing to the Company by or on behalf of the
Underwriters specifically for inclusion in the Registration Statement and the
Prospectus.
9. DEFAULTING UNDERWRITERS.
If, on either Delivery Date, any Underwriter defaults in
the performance of its obligations under this Agreement, the remaining
non-defaulting Underwriters shall be obligated to purchase the Stock which
the defaulting Underwriter agreed but failed to purchase on such Delivery
Date in the respective proportions which the number of shares of the Firm
Stock set opposite the name of each remaining non-defaulting Underwriter in
Schedule 1 hereto bears to the total number of shares of the Firm Stock set
opposite the names of all the remaining non-defaulting Underwriters
23
in Schedule 1 hereto; PROVIDED, HOWEVER, that the remaining non-defaulting
Underwriters shall not be obligated to purchase any of the Stock on such
Delivery Date if the total number of shares of the Stock which the defaulting
Underwriter or Underwriters agreed but failed to purchase on such date
exceeds 9.09% of the total number of shares of the Stock to be purchased on
such Delivery Date, and any remaining non-defaulting Underwriter shall not be
obligated to purchase more than 110% of the number of shares of the Stock
which it agreed to purchase on such Delivery Date pursuant to the terms of
Section 2. If the foregoing maximums are exceeded, the remaining
non-defaulting Underwriters, or those other underwriters satisfactory to the
Representatives who so agree, shall have the right, but shall not be
obligated, to purchase, in such proportion as may be agreed upon among them,
all the Stock to be purchased on such Delivery Date. If the remaining
Underwriters or other underwriters satisfactory to the Representatives do not
elect to purchase the shares which the defaulting Underwriter or Underwriters
agreed but failed to purchase on such Delivery Date, this Agreement (or, with
respect to the Second Delivery Date, the obligation of the Underwriters to
purchase, and of the Company to sell, the Option Stock) shall terminate
without liability on the part of any non-defaulting Underwriter or the
Company, except that the Company will continue to be liable for the payment
of expenses to the extent set forth in Sections 6 and 11. As used in this
Agreement, the term "Underwriter" includes, for all purposes of this
Agreement unless the context requires otherwise, any party not listed in
Schedule 1 hereto who, pursuant to this Section 9, purchases Firm Stock which
a defaulting Underwriter agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting
Underwriter of any liability it may have to the Company for damages caused by
its default. If other underwriters are obligated or agree to purchase the Stock
of a defaulting or withdrawing Underwriter, either the Representatives or the
Company may postpone the Delivery Date for up to seven full business days in
order to effect any changes that in the opinion of counsel for the Company or
counsel for the Underwriters may be necessary in the Registration Statement, the
Prospectus or in any other document or arrangement.
10. TERMINATION. The obligations of the Underwriters hereunder
may be terminated by the Representatives by notice given to and received by the
Company prior to delivery of and payment for the Firm Stock if, prior to that
time, any of the events described in Sections 7(i) or 7(k) shall have occurred
or if the Underwriters shall decline to purchase the Stock for any reason
permitted under this Agreement.
11. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If (a) the
Company shall fail to tender the Stock for delivery to the Underwriters by
reason of any failure, refusal or inability on the part of the Company to
perform any agreement on its part to be performed, or because any other
condition of the Underwriters' obligations hereunder required to be fulfilled by
the Company is not fulfilled, the Company will reimburse the Underwriters for
all reasonable out-of-pocket expenses (including fees and disbursements of
counsel) incurred by the Underwriters in connection with this Agreement and the
proposed purchase of the Stock, and upon demand the Company shall pay the full
amount thereof to the Representative(s). If this Agreement is terminated
pursuant to Section 9 by reason of the default of one or more Underwriters, the
Company shall not be obligated to reimburse any defaulting Underwriter on
account of those expenses.
24
12. NOTICES, ETC. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or
sent by mail, telex or facsimile transmission to Lehman
Brothers Inc., Three World Financial Center, New York, New
York 10285, Attention: Syndicate Department (Fax:
212-526-6588), with a copy, in the case of any notice pursuant
to Section 8(c), to the Director of Litigation, Office of the
General Counsel, Lehman Brothers Inc., 3 World Financial
Center, 10th Floor, New York, NY 10285;
(b) if to the Company or any of its subsidiaries,
shall be delivered or sent by mail, telex or facsimile
transmission to the address of the Company set forth in the
Registration Statement, Attention: Gordon S. Black, Ph.D.,
Chairman and Chief Executive Officer (Fax:
716-272-7258);
PROVIDED, HOWEVER, that any notice to an Underwriter pursuant to Section 8(c)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Representatives, which address will be supplied to any other party hereto by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company shall
be entitled to act and rely upon any request, consent, notice or agreement given
or made on behalf of the Underwriters by Lehman Brothers Inc. on behalf of the
Representatives.
13. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement
shall inure to the benefit of and be binding upon the Underwriters, the Company,
and their respective successors. This Agreement and the terms and provisions
hereof are for the sole benefit of only those persons, except that (A) the
representations, warranties, indemnities and agreements of the Company contained
in this Agreement shall also be deemed to be for the benefit of the person or
persons, if any, who control any Underwriter within the meaning of Section 15 of
the Securities Act and (B) the indemnity agreement of the Underwriters contained
in Section 8(b) of this Agreement shall be deemed to be for the benefit of
directors of the Company, officers of the Company who have signed the
Registration Statement and any person controlling the Company within the meaning
of Section 15 of the Securities Act. Nothing in this Agreement is intended or
shall be construed to give any person, other than the persons referred to in
this Section 13, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision contained herein.
14. SURVIVAL. The respective indemnities, representations,
warranties and agreements of the Company, each of its subsidiaries and the
Underwriters contained in this Agreement or made by or on behalf on them,
respectively, pursuant to this Agreement, shall survive the delivery of and
payment for the Stock and shall remain in full force and effect, regardless of
any investigation made by or on behalf of any of them or any person controlling
any of them.
15. DEFINITION OF THE TERMS "BUSINESS DAY" AND "SUBSIDIARY".
For purposes of this Agreement, (a) "business day" means each Monday, Tuesday,
Wednesday, Thursday or Friday
25
which is not a day on which banking institutions in New York are generally
authorized or obligated by law or executive order to close and (b) "subsidiary"
has the meaning set forth in Rule 405 of the Rules and Regulations.
16. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF NEW YORK.
17. COUNTERPARTS. This Agreement may be executed in one or
more counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
18. HEADINGS. The headings herein are inserted for convenience
of reference only and are not intended to be part of, or to affect the meaning
or interpretation of, this Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
If the foregoing correctly sets forth the agreement among the
Company, its subsidiaries] and the Underwriters, please indicate your acceptance
in the space provided for that purpose below.
Very truly yours,
HARRIS INTERACTIVE INC.
By
--------------------------
Name:
Title:
GORDON S. BLACK CORPORATION
By
--------------------------
Name:
Title:
LOUIS HARRIS & ASSOCIATES, INC.
By
--------------------------
Name:
Title:
GSBC OHIO CORPORATION
By
--------------------------
Name:
Title:
Accepted:
LEHMAN BROTHERS INC.
U.S. BANCORP PIPER JAFFRAY INC.
VOLPE BROWN WHELAN & CO.
E*OFFERING CORP.
For themselves and as Representatives
of the several Underwriters named
in Schedule 1 hereto
By LEHMAN BROTHERS INC.
By
--------------------------------
Name:
Title:
SCHEDULE 1
[Download Table]
Number of
Underwriters Shares
------------ ------
Lehman Brothers Inc. . . . . . . . . . . . . . .
U.S. Bancorp Piper Jaffray Inc. . . . . . . . . .
Volpe Brown Whelan & Co. . . . . . . . . . . . .
E*OFFERING CORP. . . . . . . . . . . . . . . . .
---------
Total
---------
---------
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