Exhibit 10.1
MASTEC, INC.
4.00% Senior Convertible Notes due
2014
UNDERWRITING
AGREEMENT
June 1, 2009
June 1, 2009
M ORGAN S TANLEY & C O .
I NCORPORATED
As Representative of
the Underwriters
c/o Morgan Stanley & Co.
Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
MasTec, Inc., a Florida corporation
(the “ Company ”), proposes to issue and sell to
the several Underwriters named in Schedule I hereto (the “
Underwriters ”) the respective amounts set forth in
Schedule I hereto of $100,000,000 aggregate principal amount of the
Company’s 4.00% Senior Convertible Notes due 2014 (the
“ Firm Notes ”). The Company also proposes to
sell to the several Underwriters not more than an additional
$15,000,000 aggregate principal amount of its 4.00% Senior
Convertible Notes due 2014 (the “ Option Notes
” and, together with the Firm Notes, the “ Notes
”). Morgan Stanley & Co. Incorporated has agreed to
act as Representative of the Underwriters (the “
Representative ”) in connection with the offering and
sale of the Notes.
The Notes will be convertible on
terms, and subject to the conditions, set forth in the Indenture
(as defined below). As used herein, “ Conversion
Shares ” means the shares of common stock, par value
$0.10 per share (the “ Common Stock ”) of the
Company to be received by the holders of the Notes upon conversion
of the Notes pursuant to the terms of the Notes.
The Notes will be issued pursuant to
an indenture, to be dated as of June 5, 2009, as supplemented
by a supplemental indenture (as so supplemented, the “
Indenture ”), among the Company, the Guarantors (as
defined below) and U.S. Bank National Association, as trustee (the
“ Trustee ”). The Notes will be issued only in
book-entry form in the name of Cede & Co., as nominee of
The Depository Trust Company (the “ Depositary
”), pursuant to a blanket letter of representations among the
Company and the Depositary.
The payment of principal of,
premium, if any, and interest on the Notes will be fully and
unconditionally guaranteed on a senior unsecured basis, jointly and
severally by (i) each of the Company’s subsidiaries
listed in Schedule IV hereto, and (ii) any subsidiary of the
Company formed or acquired after the Closing Date that executes an
additional guarantee in accordance with the terms of the Indenture,
and their respective successors and assigns (collectively, the
“ Guarantors ”), pursuant to their guarantees
(the “ Guarantees ”). The Firm Notes and the
Guarantees to be attached thereto are herein collectively referred
to as the “ Firm Securities ”, and the Option
Notes and the Guarantees to be attached thereto are herein
collectively referred to as the “ Option Securities
” and the Firm Securities and the Option Securities are
herein collectively referred to as the “ Securities
”.
The Company has filed with the
Securities and Exchange Commission (the “ Commission
”) a shelf registration statement, including a prospectus,
(the file number of which is 333-158502) on Form S-3, relating to
securities (the “ Shelf Securities ”) including
the Securities, to be issued from time to time by the Company. The
registration statement, at any given time, including the amendments
thereto to such time, the exhibits and any schedules thereto at
such time, the documents incorporated by reference therein pursuant
to Item 12 of Form S-3 under the Securities Act of 1933, as
amended (the “ Securities Act ”), at such time
and the documents otherwise deemed to be a part thereof or included
therein by regulations promulgated under the Securities Act, as
amended to the date of this Agreement, is hereinafter referred to
as the “ Registration Statement ”; and the
related prospectus covering the Shelf Securities dated
April 8, 2009 in the form first used to confirm sales of the
Securities (or in the form first made available to the Underwriters
by the Company to meet requests of purchasers pursuant to Rule 173
under the Securities Act) is hereinafter referred to as the “
Basic Prospectus. ” The Basic Prospectus, as
supplemented by the prospectus supplement specifically relating to
the Securities in the form first used to confirm sales of
Securities (or in the form first made available to the Underwriters
by the Company to meet requests of purchasers pursuant to Rule 173
under the Securities Act) is hereinafter referred to as the “
Prospectus, ” and the term “ preliminary
prospectus ” means any preliminary form of the
Prospectus. For purposes of this Agreement, “ free writing
prospectus ” has the meaning set forth in Rule 405 under
the Securities Act, “ Time of Sale Prospectus ”
means the preliminary prospectus together with the free writing
prospectuses, if any, each identified in Schedule II hereto, and
“ broadly available road show ” means a
“bona fide electronic road show” as defined in Rule
433(h)(5) under the Securities Act that has been made available
without restriction to any person. As used herein, the terms
“Registration Statement,” “Basic
Prospectus,” “preliminary prospectus,”
“Time of Sale Prospectus” and “Prospectus”
shall include the documents, if any, incorporated by reference
therein. The terms “ supplement ,” “
amendment ,” and “ amend ” as used
herein with respect to the Registration Statement, the Basic
Prospectus, the Time of Sale Prospectus, any preliminary prospectus
or any free writing prospectus shall include all documents
subsequently filed by the Company with the Commission pursuant to
the Securities Exchange Act of 1934, as amended (the “
Exchange Act ”), that are incorporated by reference
therein. For purposes of this Agreement, all references to the
Registration Statement, any preliminary prospectus, the Prospectus
or any amendment or supplement to any of the foregoing shall be
deemed to include the copy filed with the Commission pursuant to
its Electronic Data Gathering, Analysis and Retrieval system
(EDGAR) and/or Interactive Data Electronic Applications (IDEA)
system or any successor system or database.
1. Representations and
Warranties.
The Company and the Guarantors,
jointly and severally, as of the date hereof and as of the First
Closing Date (as defined in Section 4), and as of the Option
Closing Date (as defined in Section 2), if any, represents and
warrants to and agrees with each of the Underwriters
that:
(a) The Registration Statement has
become effective; no stop order suspending the effectiveness of the
Registration Statement is in effect, and no proceedings for such
purpose are pending before or threatened by the
Commission.
2
(b) As of the date the Registration
Statement was filed, the Company was a well-known seasoned issuer
(as defined in Rule 405 of the Securities Act) eligible to use the
Registration Statement as an automatic shelf registration statement
and the Company has not received notice that the Commission objects
to the use of the Registration Statement as an automatic shelf
registration statement.
(c) (i) The Registration Statement,
when it became effective, did not contain and, as amended or
supplemented, if applicable, will not contain any untrue statement
of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, (ii) the Registration Statement as of the date
hereof does not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading,
(iii) the Registration Statement and the Prospectus comply
and, as amended or supplemented, if applicable, will comply in all
material respects with the Securities Act and the applicable rules
and regulations of the Commission thereunder, (iv) the Time of
Sale Prospectus does not, and at the time of each sale of the
Securities in connection with the offering when the Prospectus is
not yet available to prospective purchasers and at the Closing Date
(as defined in Section 4), the Time of Sale Prospectus, as
then amended or supplemented by the Company, if applicable, will
not, contain any 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 were made, not
misleading, (v) each broadly available road show, if any, when
considered together with the Time of Sale Prospectus, does not
contain any 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 were made, not
misleading and (vi) the Prospectus does not contain and, as
amended or supplemented, if applicable, will not contain any 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 were made, not misleading, except
that the representations and warranties set forth in this paragraph
do not apply to statements or omissions in the Registration
Statement, the Time of Sale Prospectus or the Prospectus based upon
information relating to any Underwriter furnished to the Company in
writing by such Underwriter through you expressly for use
therein.
(d) The documents incorporated or
deemed to be incorporated by reference in the Time of Sale
Prospectus or the Prospectus, at the time they were or hereafter
are filed with the Commission, complied and will comply in all
material respects with the requirements of the Exchange Act and the
rules and regulations of the Commission thereunder (the “
Exchange Act Regulations ”), and, when read together
with the other information in the Time of Sale Prospectus or the
Prospectus at its date and at the Closing Date, 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.
(e) The Company is not an
“ineligible issuer” in connection with the offering
pursuant to Rules 164, 405 and 433 under the Securities Act. Any
free writing prospectus that the Company is required to file
pursuant to Rule 433(d) under the Securities Act has been, or will
be, filed with the Commission in accordance with the requirements
of the Securities Act and the applicable rules and regulations of
the Commission thereunder. Each free writing prospectus that the
Company has filed, or is required to file, pursuant to Rule 433(d)
under the Securities Act or that was prepared by or behalf of or
used or referred to by the Company complies or will
3
comply in all material respects with the
requirements of the Securities Act and the applicable rules and
regulations of the Commission thereunder. Except for the free
writing prospectuses, if any, identified in Schedule II hereto, and
electronic road shows, if any, furnished to you before first use,
the Company has not prepared, used or referred to, and will not,
without your prior consent, prepare, use or refer to, any free
writing prospectus. Any issuer free writing prospectus as defined
in Rule 433(h) under the Securities Act, as of its issue date and
at all subsequent times through the completion of the public offer
and sale of Securities or until any earlier date that the Company
notified or notifies the Representative as required in
Section 6(e) and 6(f), did not, does not and will not include
any information that conflicted, conflicts or will conflict with
the information contained in the Registration Statement, the Time
of Sale Prospectus or the Prospectus, including any document
incorporated by reference therein and any preliminary or other
prospectus deemed to be a part thereof that has not been superseded
or modified.
(f) The Company has been duly
incorporated, is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its property and to conduct
its business as described in the Time of Sale Prospectus and is
duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership
or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing
would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(g) Each “significant
subsidiary” as such term is defined in Item 1-02 of
Regulation S-X promulgated by the Commission (each a “
Significant Subsidiary ”) of the Company is listed on
Schedule III hereto. Each Significant Subsidiary of the Company has
been duly incorporated or organized, is validly existing as a
corporation or limited liability company in good standing under the
laws of the respective jurisdiction of incorporation or
organization, has the corporate or limited liability company power
and authority to own its respective property and to conduct its
respective businesses as described in the Time of Sale Prospectus
and is duly qualified to transact business and is in good standing
in each jurisdiction in which the conduct of its respective
businesses or ownership or leasing of property requires such
qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole; all
of the issued shares of capital stock of each subsidiary of the
Company have been duly and validly authorized and issued, 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, except as set forth in the Registration
Statement.
(h) Each Guarantor has been duly
incorporated or organized, is validly existing as a corporation or
limited liability company in good standing under the laws of the
respective jurisdiction of incorporation or organization, has the
corporate or limited liability company power and authority to own
its respective property and to conduct its respective businesses as
described in the Time of Sale Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in
which the conduct of its respective businesses or ownership or
leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing
would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole; all of the issued shares of capital
stock of each Guarantor have been duly and validly authorized and
issued, 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 except as set forth in the
Registration Statement.
4
(i) This Agreement has been duly
authorized, executed and delivered by the Company and the
Guarantors.
(j) The Notes to be purchased by the
Underwriters from the Company are in the form contemplated by the
Indenture, have been duly authorized for issuance and sale pursuant
to this agreement and the Indenture and, at the First Closing Date
or any Option Closing Date, will have been duly executed by the
Company and, when authenticated in the manner provided for in the
Indenture and delivered against payment of the purchase price
therefor, will constitute valid and binding agreements of the
Company, enforceable in accordance with their terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or
affecting the rights and remedies of creditors generally or by
general equitable principles (regardless of whether enforcement is
considered in a proceeding at law or in equity) and will be
entitled to the benefits of the Indenture. The Guarantees are in
the respective forms contemplated by the Indenture, have been duly
authorized for issuance and sale pursuant to this agreement and the
Indenture by the respective Guarantor and, at the Closing Date,
will have been duly executed by each of the Guarantors and, when
the Securities have been authenticated in the manner provided for
in the Indenture and delivered against payment of the purchase
price therefore, will constitute valid and binding agreements of
the Guarantors, enforceable in accordance with their terms, except
as enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or
affecting the rights and remedies of creditors generally or by
general equitable principles (regardless of whether enforcement is
considered in a proceeding at law or in equity) and will be
entitled to the benefits of the Indenture.
(k) The Conversion Shares have been
duly authorized and reserved and, when issued upon conversion of
the Notes in accordance with the terms of the Notes, will be
validly issued, fully paid and non-assessable, and the issuance of
such Conversion Shares will not be subject to any preemptive or
similar rights.
(l) The Indenture has been duly
authorized by the Company and the Guarantors and, at the First
Closing Date, will have been duly executed and delivered by the
Company and the Guarantors and will constitute a valid and binding
agreement of the Company and the Guarantors, enforceable against
the Company and the Guarantors in accordance with its terms, except
as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors
generally or by general equitable principles (regardless of whether
enforcement is considered in a proceeding at law or in equity). The
Indenture has been qualified under the Trust Indenture Act of 1939,
as amended (the “ Trust Indenture Act
”).
(m) The Securities, when issued, and
the Indenture will conform as to legal matters to the description
thereof contained in each of the Time of Sale Prospectus and the
Prospectus.
(n) The authorized capital stock of
the Company conforms as to legal matters to the description thereof
contained in each of the Time of Sale Prospectus and the
Prospectus.
5
(o) The shares of Common Stock
outstanding have been duly authorized and are validly issued, fully
paid and non-assessable.
(p) The statements in the Time of
Sale Prospectus and the Prospectus under the headings
“Description of the Notes”, “Description of the
Capital Stock” and “Certain United States Federal
Income Tax Considerations” fairly summarize the matters
therein described.
(q) The execution and delivery by
the Company and the Guarantors of, and the performance by the
Company and the Guarantors of their respective obligations under,
this Agreement, the Indenture, the Securities and any other
agreement or instrument entered into or issued or to be entered
into by the Company and the Guarantors in connection with the
transactions contemplated hereby or thereby (including the issuance
of the Conversion Shares upon conversion of the Notes) will not
contravene any provision of applicable law or the certificate of
incorporation or by-laws of the Company or the Guarantors or any
agreement or other instrument binding upon the Company or any of
its subsidiaries or the Guarantors that is material to the Company
and its subsidiaries, taken as a whole, or any judgment, order or
decree of any governmental body, agency or court having
jurisdiction over the Company or any Guarantor, and no consent,
approval, authorization or order of, or qualification with, any
governmental body or agency is required for the performance by the
Company or the Guarantors of their respective obligations under
this Agreement, the Indenture, the Securities and any other
agreement or instrument entered into or issued or to be entered
into by the Company or the Guarantors in connection with the
transactions contemplated hereby or thereby (including the issuance
of the Conversion Shares upon conversion of the Notes) except such
as may be required by the securities or Blue Sky laws of the
various states in connection with the offer and sale of the
Securities.
(r) There has not occurred any
material adverse change, or any development involving a prospective
material adverse change, in the condition, financial or otherwise,
or in the earnings, business or operations of the Company and its
subsidiaries, taken as a whole, from that set forth in the Time of
Sale Prospectus.
(s) There are no legal or
governmental proceedings pending or threatened to which the Company
or any of its subsidiaries is a party or to which any of the
properties of the Company or any of its subsidiaries is subject
other than proceedings accurately described in all material
respects in the Time of Sale Prospectus and proceedings that would
not have a material adverse effect on the Company and its
subsidiaries, taken as a whole, or on the power or ability of the
Company to perform its obligations under this Agreement or to
consummate the transactions contemplated by the Time of Sale
Prospectus.
(t) 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 Securities Act, complied when so filed in all material
respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder.
(u) The Company is not, and after
giving effect to the offering and sale of the Securities and the
application of the proceeds thereof as described in the Time of
Sale Prospectus and the Prospectus will not be, required to
register as an “investment company” as such term is
defined in the Investment Company Act of 1940, as
amended.
6
(v) Except as disclosed in the
Registration Statement, the Company and its subsidiaries
(i) are in compliance with any and all applicable foreign,
federal, state and local laws and regulations relating to the
protection of human health and safety, the environment or hazardous
or toxic substances or wastes, pollutants or contaminants (“
Environmental Laws ”), (ii) have received all
permits, licenses or other approvals required of them under
applicable Environmental Laws to conduct their respective
businesses and (iii) are in compliance with all terms and
conditions of any such permit, license or approval, except where
such noncompliance with Environmental Laws, failure to receive
required permits, licenses or other approvals or failure to comply
with the terms and conditions of such permits, licenses or
approvals would not, singly or in the aggregate, have a material
adverse effect on the Company and its subsidiaries, taken as a
whole.
(w) Except as disclosed in the
Registration Statement, there are no costs or liabilities
associated with Environmental Laws (including, without limitation,
any capital or operating expenditures required for clean-up,
closure of properties or compliance with Environmental Laws or any
permit, license or approval, any related constraints on operating
activities and any potential liabilities to third parties) which
would, singly or in the aggregate, have a material adverse effect
on the Company and its subsidiaries, taken as a whole.
(x) Except as disclosed in the
Registration Statement, 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 or to require the Company to include such securities
with the Securities registered pursuant to the Registration
Statement.
(y) The pro forma consolidated
financial statements of the Company and its subsidiaries and the
related notes thereto included in the Preliminary Prospectus, the
Prospectus and the Registration Statement or incorporated by
reference in the Preliminary Prospectus, the Prospectus and the
Registration Statement, present fairly the information contained
therein, have been prepared in accordance with the
Commission’s rules and guidelines with respect to pro forma
financial statements and have been properly presented on the basis
described therein, and the assumptions used in the preparation
thereof are reasonable and the adjustments used therein are
appropriate to give effect to the transactions and circumstances
referred to therein.
(z) Neither the Company nor any of
its subsidiaries or affiliates, nor any director, officer, or
employee, nor, to the Company’s knowledge, any agent or
representative of the Company or of any of its subsidiaries or
affiliates, has taken or will take any action in furtherance of an
offer, payment, promise to pay, or authorization or approval of the
payment or giving of money, property, gifts or anything else of
value, directly or indirectly, to any “government
official” (including any officer or employee of a government
or government-owned or controlled entity or of a public
international organization, or any person acting in an official
capacity for or on behalf of any of the foregoing, or any political
party or party official or candidate for political office) to
influence official action or secure an improper advantage; and the
Company and its subsidiaries and affiliates have conducted their
businesses in compliance
7
with applicable anti-corruption laws and have
instituted and maintain and will continue to maintain policies and
procedures designed to promote and achieve compliance with such
laws and with the representation and warranty contained
herein.
(aa) The operations of the Company
and its subsidiaries are and have been conducted at all times in
material compliance with all applicable financial recordkeeping and
reporting requirements, including those of the Bank Secrecy Act, as
amended by Title III of the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001 (USA PATRIOT Act), and the applicable
anti-money laundering statutes of jurisdictions where the Company
and its subsidiaries conduct business, the rules and regulations
thereunder and any related or similar rules, regulations or
guidelines, issued, administered or enforced by any governmental
agency (collectively, the “ Anti-Money Laundering Laws
”), and no action, suit or proceeding by or before any court
or governmental agency, authority or body or any arbitrator
involving the Company or any of its subsidiaries with respect to
the Anti-Money Laundering Laws is pending or, to the best knowledge
of the Company, threatened.
(bb) (i) The Company represents that
neither the Company nor any of its subsidiaries (collectively, the
“ Entity ”) or any director, officer, employee,
agent, affiliate or representative of the Entity, is an individual
or entity (“ Person ”) that is, or is owned or
controlled by a Person that is:
(A) the subject of any sanctions
administered or enforced by the U.S. Department of Treasury’s
Office of Foreign Assets Control (“ OFAC ”), the
United Nations Security Council (“ UNSC ”) or
other sanctions authority (collectively, “ Sanctions
”), nor
(B) located, organized or resident
in a country or territory that is the subject of Sanctions
(including, without limitation, Burma/Myanmar, Cuba, Iran, North
Korea, Sudan and Syria).
(ii) The Company represents and
covenants that the Entity will not, directly or indirectly, use the
proceeds of the offering, or lend, contribute or otherwise make
available such proceeds to any subsidiary, joint venture partner or
other Person:
(A) to fund or facilitate any
activities or business of or with any Person or in any country or
territory that, at the time of such funding or facilitation, is the
subject of Sanctions; or
(B) in any other manner that will
result in a violation of Sanctions by any Person (including any
Person participating in the offering, whether as underwriter,
advisor, investor or otherwise).
(iii) The Company represents and
covenants that for the past 5 years, the Entity has not knowingly
engaged in, is not now knowingly engaged in, and will not engage
in, any dealings or transactions with any Person, or in any country
or territory, that at the time of the dealing or transaction is or
was the subject of Sanctions.
8
(cc) Subsequent to the respective
dates as of which information is given in each of the Registration
Statement, the Time of Sale Prospectus and the Prospectus,
(i) the Company and its subsidiaries have not incurred any
material liability or obligation, direct or contingent, nor entered
into any material transaction; (ii) the Company has not
purchased any of its outstanding capital stock, nor declared, paid
or otherwise made any dividend or distribution of any kind on its
capital stock other than ordinary and customary dividends; and
(iii) there has not been any material change in the capital
stock, short-term debt or long-term debt of the Company and its
subsidiaries except in each case as described in each of the
Registration Statement, the Time of Sale Prospectus and the
Prospectus, respectively.
(dd) The Company and its
subsidiaries have good and marketable title in fee simple to all
real property and good and marketable title to all personal
property owned by them which is material to the business of the
Company and its subsidiaries, in each case free and clear of all
liens, encumbrances and defects except such as are described in the
Time of Sale Prospectus or such as do not materially affect the
value of such property and do not interfere with the use made and
proposed to be made of such property by the Company and its
subsidiaries; and any 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, in each case except as described in the Time of Sale
Prospectus.
(ee) The Company and its
subsidiaries own or possess, or can acquire on reasonable terms,
all material patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information,
systems or procedures), trademarks, service marks and trade names
currently employed by them in connection with the business now
operated by them, and neither the Company nor any of its
subsidiaries has received any notice of infringement of or conflict
with asserted rights of others with respect to any of the foregoing
which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would have a material adverse effect
on the Company and its subsidiaries, taken as a whole.
(ff) No material labor dispute with
the employees of the Company or any of its subsidiaries exists,
except as described in the Time of Sale Prospectus, or, to the
knowledge of the Company, is imminent; and the Company is not aware
of any existing, threatened or imminent labor disturbance by the
employees of any of its principal suppliers, manufacturers or
contractors that could have a material adverse effect on the
Company and its subsidiaries, taken as a whole.
(gg) The Company and each of its
subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as
are prudent and customary in the businesses in which they are
engaged; neither the Company nor any of its subsidiaries has been
refused any insurance coverage sought or applied for, and neither
the Company nor any of its subsidiaries has any reason to believe
that it will not be able to renew its existing insurance coverage
as and when such coverage expires or to obtain similar coverage
from similar insurers as may be necessary to continue its business
at a cost that would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole, except as described
in the Time of Sale Prospectus.
9
(hh) The Company and its
subsidiaries possess all certificates, authorizations and permits
issued by the appropriate federal, state or foreign regulatory
authorities necessary to conduct their respective businesses, and
neither the Company nor any of its subsidiaries has received any
notice of proceedings relating to the revocation or modification of
any such certificate, authorization or permit which, singly or in
the aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a material adverse effect on the Company and
its subsidiaries, taken as a whole, except as described in the Time
of Sale Prospectus.
(ii) The Company and each of its
subsidiaries maintain a system of internal accounting controls
sufficient to provide reasonable assurance that
(i) transactions are executed in accordance with
management’s general or specific authorizations;
(ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset
accountability; (iii) access to assets is permitted only in
accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences. Except
as described in the Time of Sale Prospectus, since the end of the
Company’s most recent audited fiscal year, there has been
(i) no material weakness in the Company’s internal
control over financial reporting (whether or not remediated) and
(ii) no change in the Company’s internal control over
financial reporting that has materially affected, or is reasonably
likely to materially affect, the Company’s internal control
over financial reporting.
(jj) Except as described in the Time
of Sale Prospectus, the Company has not sold, issued or distributed
any shares of Common Stock during the six-month period preceding
the date hereof, including any sales pursuant to Rule 144A
under, or Regulation D or S of, the Securities Act, other than
shares issued pursuant to employee benefit plans, qualified stock
option plans or other employee compensation plans or pursuant to
outstanding options, rights or warrants.
2. Agreements to Sell and
Purchase . The Company and the Guarantors agree to issue and
sell to the several Underwriters, severally and not jointly, all of
the Firm Securities, and each Underwriter, upon the basis of the
representations and warranties herein contained, but subject to the
conditions hereinafter stated, agrees, severally and not jointly,
to purchase from the Company the respective number of Firm
Securities set forth in Schedule I hereto opposite such
Underwriter’s name at a purchase price of 96.75% of the
principal amount thereof (the “ Purchase Price
”).
On the basis of the representations
and warranties contained in this Agreement, and subject to its
terms and conditions, the Company and the Guarantors agree to issue
and sell to the Underwriters, severally and not jointly, and the
Underwriters shall have the right to purchase, severally and not
jointly, up to $15,000,000 aggregate principal amount of Option
Notes at the Purchase Price. You may exercise this right on behalf
of the Underwriters in whole or from time to time in part by giving
written notice not later than 30 days after the date of this
Agreement. Any exercise notice shall specify the number of Option
Securities to be purchased by the Underwriters and the date on
which such shares are to be purchased. Each purchase date must be
at least one business day after the written notice is given and may
not be earlier than the First Closing Date nor later than ten
business days after the date of such notice. On each day, if any,
that Option Securities are to be purchased (an “ Option
Closing Date ”), which may be the First Closing
Date
10
(the First Closing Date and each Option Closing
Date, if any, being sometimes referred to as a “ Closing
Date ”), each Underwriter agrees, severally and not
jointly, to purchase the number of Option Securities that bears the
same proportion to the total number of Option Securities to be
purchased on such Option Closing Date as the number of Firm
Securities set forth in Schedule I hereto opposite the name of such
Underwriter bears to the total number of Firm
Securities.
3. Terms of Public Offering .
The Company and the Guarantors are advised by you that the
Underwriters propose to make a public offering of their respective
portions of the Securities as soon after the Registration Statement
and thi
