Cal Dive International,
Inc.
Credit Suisse Securities
(USA) LLC
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
CREDIT SUISSE
SECURITIES (USA) LLC
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
As Representatives of the several
Underwriters
Credit Suisse
Securities (USA) LLC
Eleven Madison Avenue
New York, NY 10010-3629
Merrill Lynch,
Pierce, Fenner & Smith
Incorporated
One Bryant Park
New York, NY 10036
Introductory. Helix Energy Solutions Group, Inc. (the
“Selling Stockholder”), a Minnesota corporation and a
stockholder of Cal Dive International, Inc., a Delaware corporation
(the “Company”), proposes to sell to the several
underwriters named in Schedule A (the
“Underwriters”) an aggregate of 20,000,000 shares (the
“Firm Shares”) of Common Stock, par value $0.01 per
share (the “Common Stock”), of the Company. In
addition, the Selling Stockholder has granted to the Underwriters
an option to purchase up to an additional 3,000,000 shares (the
“Optional Shares”) of Common Stock, as provided in
Section 2. The Firm Shares and, if and to the extent such
option is exercised, the Optional Shares are collectively called
the “Shares”. Credit Suisse Securities (USA) LLC
(“Credit Suisse”) and Merrill Lynch, Pierce, Fenner
& Smith Incorporated have agreed to act as representatives of
the several Underwriters (in such capacity, the
“Representatives”) in connection with the offering and
sale of the Shares.
To the extent
there are no additional Underwriters listed on
Schedule A other than you, the terms Representatives
and Underwriters as used herein shall mean you, as Underwriters.
The terms Representatives and Underwriters shall mean either the
singular or plural as the context requires.
The Company and
the Underwriters agree that up to 250,000 of the Firm Shares to be
purchased by the Underwriters (the “Directed Shares”)
shall be reserved for sale by the Underwriters to certain eligible
officers and directors of the Company (collectively, the “DSP
Participants”), as part of the distribution of the Shares by
the Underwriters (the “Directed Share
1
Program”)
subject to the terms of this Agreement, the applicable rules,
regulations and interpretations of the Financial Industry
Regulatory Authority, Inc. (the “FINRA”) and all other
applicable laws, rules and regulations. Credit Suisse (the
“DSP Underwriter”) has been selected to process the
sales to the DSP Participants under the Directed Share Program. To
the extent that such Directed Shares are not orally confirmed for
purchase by the DSP Participants by 12:00 A.M. New York City
time on June 5, 2009, such Directed Shares may be offered to
the public as set forth in the Prospectus (as defined
below).
The Company and
the Selling Stockholder respectively, and not jointly, hereby
confirm their respective agreements with the Underwriters as
follows:
Section 1. Representations
and Warranties.
A. The Company
hereby represents and warrants as of the date hereof, as of the
Applicable Time (as defined below), as of the Closing Date referred
to in Section 2 hereof and as of each Subsequent Closing Date
(if any) referred to in Section 2 hereof, and covenants to
each Underwriter as follows:
(a) The
Company has prepared and filed with the Securities and Exchange
Commission (the “Commission”) a registration statement
on Form S-3 (File No. 333-148142), which contains a base
prospectus (the “Base Prospectus”), to be used in
connection with the public offering and sale of the Shares. Such
registration statement, as amended, including the financial
statements, exhibits and schedules thereto, in the form in which it
was declared effective by the Commission under the Securities Act
of 1933 and the rules and regulations promulgated thereunder
(collectively, the “Securities Act”), including any
required information deemed to be a part thereof at the time of
effectiveness pursuant to Rule 430B under the Securities Act
or the Securities Exchange Act of 1934 and the rules and
regulations promulgated thereunder (collectively, the
“Exchange Act”), is called the “Registration
Statement”. Any preliminary prospectus supplement to the Base
Prospectus that describes the Shares and the offering thereof and
is used prior to filing of the final prospectus supplement relating
to the Shares is called, together with the Base Prospectus, a
“preliminary prospectus”. The term
“Prospectus” shall mean the final prospectus supplement
relating to the Shares that is first filed pursuant to Rule 424(b)
after the date and time that this Agreement is executed and
delivered by the parties hereto, together with the Base Prospectus.
Any reference herein to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to
Item 12 of Form S-3 under the Securities Act; any reference to
any amendment or supplement to any preliminary prospectus or the
Prospectus shall be deemed to refer to and include any documents
filed after the date of such preliminary prospectus or Prospectus,
as the case may be, under the Exchange Act, that are incorporated
by reference in such preliminary prospectus or Prospectus, as the
case may be; and any reference to any amendment to the Registration
Statement shall be deemed to refer to and include the filing of any
document under the Exchange Act that is incorporated by reference
in the Registration Statement, including, without limitation, any
annual report of the Company filed pursuant to Section 13(a) or
15(d) of the Exchange Act after the effective date of the
Registration Statement that is incorporated by reference in the
Registration Statement.
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(b)
Compliance with Registration Requirements. The Registration
Statement has been declared effective by the Commission under the
Securities Act. The Company has complied with all requests of the
Commission for additional or supplemental information. No stop
order suspending the effectiveness of the Registration Statement is
in effect and no proceedings for such purpose or pursuant to
Section 8A of the Securities Act against the Company or
related to the offering have been instituted or are pending or, to
the knowledge of the Company, are contemplated or threatened by the
Commission.
The preliminary
prospectus dated June 1, 2009 complied and the Prospectus when
filed will comply in all material respects with the Securities Act
and the rules thereunder and, if filed by electronic transmission
pursuant to the Commission’s Electronic Data Gathering,
Analysis and Retrieval System (“EDGAR”) (except as may
be permitted by Regulation S-T under the Securities Act), was
identical to the copy thereof delivered to the Underwriters for use
in connection with the offer and sale of the Shares. The
Registration Statement, at the time it became effective, complied
and, as amended or supplemented, if applicable, will comply, as of
the date of such amendment or supplement, as applicable, in all
material respects with the Securities Act and did not, at the time
it became effective, and, as amended or supplemented, if
applicable, will not, as of the date of such amendment or
supplement, contain any untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading. The
Prospectus, as of its date, does not or will not and, as amended or
supplemented, will not, as of the date of such amendment or
supplement, as applicable, contain any untrue statement of a
material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The representations and
warranties set forth in the two immediately preceding sentences do
not apply to statements in or omissions from the Registration
Statement or any post-effective amendment thereto, or the
Prospectus, or any amendments or supplements thereto, made in
reliance upon and in conformity with information furnished in
writing to the Company by the Selling Stockholder or information
relating to any Underwriter furnished to the Company in writing by
the Representatives, in each case expressly for use therein, it
being understood and agreed that the only such information
furnished by the Selling Stockholder as of the date hereof consists
of the information described as such in Section 8(b) hereof, and
that the only such information furnished by the Representatives as
of the date hereof consists of the information described as such in
Section 8(c) hereof. There is no contract or other document
required to be described in the Prospectus or to be filed as an
exhibit to the Registration Statement that has not been described
or filed as required.
The documents
incorporated by reference in the Prospectus, when they became
effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the
Securities Act or the Exchange Act, as applicable. Any further
documents so filed and incorporated by reference in the Prospectus
or any further amendment or supplement thereto, when such documents
become effective or are filed with the Commission, as the case may
be, will conform in all material respects to the requirements of
the Securities Act or the Exchange Act, as applicable, and the
rules and regulations of the Commission thereunder.
(c) Disclosure
Package . The term “Disclosure Package” shall mean
(A) the Base Prospectus and any preliminary prospectus, all as
amended or supplemented immediately prior to
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the Applicable
Time (as defined below), (B) each Issuer Free Writing
Prospectus (as defined below) identified in Schedule B
hereto (if any), (C) any other free writing prospectus that
the parties hereto shall hereafter expressly agree in writing to
treat as part of the Disclosure Package (each, a “Permitted
Free Writing Prospectus”) and (D) Schedule C
hereto, which indicates the price at which the Shares will be sold
to the public and other information relating to the offering of the
Shares. The term “Issuer Free Writing Prospectus” shall
mean any “issuer free writing prospectus,” as defined
in Rule 433 of the Securities Act relating to the Shares that
(A) is required to be filed with the Commission by the
Company, (B) is a “road show for an offering that is a
written communication” within the meaning of
Rule 433(d)(8)(i) whether or not required to be filed with the
Commission or (C) is exempt from filing pursuant to
Rule 433(d)(5)(i) because it contains a description of the
Securities or of the offering that does not reflect the final
terms, in each case in the form filed or required to be filed with
the Commission or, if not required to be filed, in the form
required to be retained in the Company’s records pursuant to
Rule 433(g). The term “Applicable Time” means 5:30
P.M. on the date of this Agreement. At the Applicable Time, the
Closing Date and on any Subsequent Closing Date, the Disclosure
Package will not contain any 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, not misleading. The preceding sentence does not
apply to statements in or omissions from the Disclosure Package
based upon and in conformity with written information furnished to
the Company by the Selling Stockholder or any Underwriter through
the Representatives specifically for use therein, it being
understood and agreed that the only such information furnished by
the Selling Stockholder as of the date hereof consists of the
information described as such in Section 8(b) hereof and that the
only such information furnished by or on behalf of any Underwriter
consists of the information described as such in Section 8(c)
hereof.
(d)
Company Not Ineligible Issuer . (i) At the earliest
time after the filing of the Registration Statement relating to the
Shares and any post-effective amendments thereto that an offering
participant made a bona fide offer (within the meaning of
Rule 164(h)(2)) of the Securities Act and (ii) as of the
date of the execution and delivery of this Agreement (with such
date being used as the determination date for purposes of this
clause (ii)), the Company was not and is not an Ineligible Issuer
(as defined in Rule 405 of the Securities Act), without taking
account of any determination by the Commission pursuant to
Rule 405 of the Securities Act that it is not necessary that
the Company be considered an Ineligible Issuer.
(e) Issuer Free
Writing Prospectuses . Each Issuer Free Writing Prospectus, as
of its issue date and at all subsequent times through the later of
the Closing Date or the last Subsequent Closing Date (if any) or
until any earlier date that the Company notified or notifies the
Representatives as described in Section 3(A)(d), (i) did
not, does not and will not include any information that conflicts
with the information contained in the Registration Statement or the
Prospectus, including any preliminary prospectus deemed to be a
part thereof that has not been superseded or modified, and
(ii) when taken together with the preliminary prospectus
preceding or accompanying such Issuer Free Writing Prospectus, did
not, does not and will not contain any untrue statement of a
material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The preceding sentence
does not apply to statements in or omissions from the Issuer Free
Writing Prospectus based upon and in conformity with written
information furnished to the Company by the Selling Stockholder or
any Underwriter through the Representatives specifically
4
for use
therein, it being understood and agreed that the only such
information furnished by the Selling Stockholder consists of the
information described as such in Section 8(b) hereof and that the
only such information furnished by or on behalf of any Underwriter
consists of the information described as such in Section 8(c)
hereof.
(f)
Accuracy of Statements in Prospectus. The statements in each
of the preliminary prospectus and the Prospectus under the headings
“Description of Capital Stock” and “Material U.S.
Federal Tax Considerations For Non-U.S. Holders of Common
Stock” insofar as such statements summarize legal matters,
agreements, documents or proceedings discussed therein, are, as of
the date of this Agreement and as of the Closing Date and any
Subsequent Closing Date (each as defined below), accurate and fair
summaries of such legal matters, agreements, documents or
proceedings.
(g)
Distribution of Offering Material By the Company. The
Company has not distributed and will not distribute, prior to the
later of the last Subsequent Closing Date and the completion of the
Underwriters’ distribution of the Shares, any offering
material in connection with the offering and sale of the Shares
other than a preliminary prospectus, the Prospectus, any Issuer
Free Writing Prospectus, the Registration Statement or other
materials, if any, permitted by the Securities Act and the rules
and regulations thereunder; provided that no such other
materials shall be distributed without the prior consent of the
Representatives.
(h) The
Underwriting Agreement. This Agreement has been duly
authorized, executed and delivered by, and is a valid and binding
agreement of, the Company.
(i) No
Transfer Taxes. There are no transfer taxes or other similar
fees or charges under federal law or the laws of any state, or any
political subdivision thereof, required to be paid by the Company
in connection with the execution and delivery of this
Agreement.
(j) No
Applicable Registration or Other Similar Rights. Except as
described in the Disclosure Package and the Prospectus, there are
no persons other than the Selling Stockholder with registration or
other similar rights to have any equity or debt securities
registered for sale under the Registration Statement or included in
the offering contemplated by this Agreement, except for such rights
as have been duly waived.
(k) No
Material Adverse Change. Except as otherwise disclosed in the
Disclosure Package and the Prospectus, subsequent to the respective
dates as of which information is given in the Disclosure Package
and the Prospectus: (i) there has been no material adverse
change, or any development that could reasonably be expected to
result in a material adverse change, in the condition, financial or
otherwise, or in the earnings, business, properties, operations or
prospects, whether or not arising from transactions in the ordinary
course of business, of the Company and its subsidiaries, considered
as one entity (any such change is called a “Material Adverse
Change”); (ii) the Company and its subsidiaries,
considered as one entity, have not incurred any material liability
or obligation, indirect, direct or contingent, nor entered into any
material transaction or agreement; and (iii) there has been no
dividend or distribution of any kind declared, paid or made by the
Company or, except for dividends paid to the Company or other
subsidiaries, any of its subsidiaries on any class of capital stock
or repurchase or redemption by the Company or any of its
subsidiaries of any class of capital stock.
5
(l)
Independent Accountants. Ernst & Young LLP, which has
expressed their opinion with respect to the financial statements
(which term as used in this Agreement includes the related notes
thereto) and supporting schedules filed with the Commission as a
part of the Registration Statement and included in the Disclosure
Package and the Prospectus, are independent public accountants with
respect to the Company as required by the Securities Act and the
Exchange Act and the applicable published rules and regulations
thereunder.
(m)
Preparation of the Financial Statements. The consolidated
financial statements of the Company filed with the Commission as a
part of or incorporated by reference in the Registration Statement
and included or incorporated by reference in the Disclosure Package
and the Prospectus present fairly the consolidated financial
position of the Company and its subsidiaries as of and at the dates
indicated and the results of their consolidated operations and cash
flows for the periods specified. The supporting schedules included
or incorporated by reference in the Registration Statement present
fairly the information required to be stated therein. Such
financial statements and supporting schedules comply as to form
with the applicable accounting requirements of the Securities Act
and have been prepared in conformity with generally accepted
accounting principles as applied in the United States applied on a
consistent basis throughout the periods involved
(“GAAP”), except as may be expressly stated in the
related notes thereto. No other financial statements or supporting
schedules are required to be included or incorporated by reference
in the Registration Statement. The financial data set forth in each
of the preliminary prospectus and the Prospectus under the captions
“Summary—Summary Consolidated Financial Data” and
“Capitalization” fairly present, in all material
respects, the information set forth therein on a basis consistent
with that of the audited financial statements contained in the
Registration Statement.
(n)
Incorporation and Good Standing of the Company and its
Subsidiaries. Each of the Company and its significant
subsidiaries (as defined in Rule 1-02(w) of
Regulation S-X), all of which are listed on Annex A hereto
(the “Significant Subsidiaries”), has been duly
incorporated or organized, as applicable, and is validly existing
in good standing under the laws of the jurisdiction of its
incorporation or organization, as applicable, and has the power and
authority (corporate or limited liability company) to own or lease,
as the case may be, and operate its properties and to conduct its
business as described in the Disclosure Package and the Prospectus
and, in the case of the Company, to enter into and perform its
obligations under this Agreement. Each of the Company and each
Significant Subsidiary is duly qualified as a foreign corporation
or entity to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except for such jurisdictions where the failure to so
qualify or to be in good standing would not, individually or in the
aggregate, result in a material adverse effect on the condition,
financial or otherwise, or on the earnings, business, properties,
operations or prospects, whether or not arising from transactions
in the ordinary course of business, of the Company and its
subsidiaries, considered as one entity (a “Material Adverse
Effect”). All of the issued and outstanding shares of capital
stock, units or membership interests, if applicable, of each
subsidiary have been duly authorized and validly issued, are fully
paid and nonassessable and, other than in conjunction with the
Company’s credit agreement, are owned by the Company,
directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance or claim. The Company
does not own or control, directly or indirectly, any corporation,
association or other entity other than the subsidiaries listed in
Exhibit 21.1 to the Company’s Annual Report on Form 10-K
for the fiscal year ended December 31, 2008.
6
(o)
Capitalization and Other Capital Stock Matters. The
authorized, issued and outstanding capital stock of the Company is
as set forth in or incorporated by reference into each of the
Disclosure Package and the Prospectus under the caption
“Capitalization” (other than for subsequent issuances,
if any, pursuant to employee benefit plans described in or
incorporated by reference into the Disclosure Package and the
Prospectus or upon exercise of outstanding options or warrants
described in or incorporated by reference into the Disclosure
Package and the Prospectus, as the case may be). The Common Stock
(including the Shares) conforms in all material respects to the
description thereof contained in or incorporated by reference into
each of the Disclosure Package and the Prospectus. All of the
issued and outstanding shares of Common Stock (including the shares
of Common Stock owned by the Selling Stockholder) have been duly
authorized and validly issued, are fully paid and nonassessable and
have been issued in compliance with federal and state securities
laws. None of the outstanding shares of Common Stock were issued in
violation of any preemptive rights, rights of first refusal or
other similar rights to subscribe for or purchase securities of the
Company. There are no authorized or outstanding options, warrants,
preemptive rights, rights of first refusal or other rights to
purchase, or equity or debt securities convertible into or
exchangeable or exercisable for, any capital stock of the Company
or any of its subsidiaries other than those accurately described in
the Disclosure Package and the Prospectus. The description of the
Company’s stock option, stock bonus and other stock plans or
arrangements, and the options or other rights granted thereunder,
set forth in or incorporated by reference into each of the
Disclosure Package and the Prospectus accurately and fairly
presents in all material respects the information required to be
shown with respect to such plans, arrangements, options and
rights.
(p)
Non-Contravention of Existing Instruments; No Further
Authorizations or Approvals Required. Neither the Company nor
any of its subsidiaries is (i) in violation or in default (or,
with the giving of notice or lapse of time, would be in default)
under (“Default”) its charter or by-laws, (ii) in
Default under any indenture, mortgage, loan or credit agreement,
deed of trust, note, contract, franchise, lease or other agreement,
obligation, condition, covenant or instrument to which the Company
or such subsidiary is a party or by which it may be bound
(including, without limitation, the Company’s credit
agreement, dated as of December 11, 2007, among CDI Vessel
Holdings LLC, Cal Dive International, Inc., the lenders named
therein and Bank of America, N.A.), or to which any of the property
or assets of the Company or any of its subsidiaries is subject
(each, an “Existing Instrument”), or (iii) in
violation of any statute, law, rule, regulation, judgment, order or
decree of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority having
jurisdiction over the Company or such subsidiary or any of its
properties, as applicable, except with respect to clauses
(ii) and (iii) only, for such Defaults and violations as
would not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect. The Company’s execution,
delivery and performance of this Agreement and consummation of the
transactions contemplated hereby, by the Disclosure Package and by
the Prospectus (i) have been duly authorized by all necessary
corporate action and will not result in any Default under the
charter or by-laws of the Company or any subsidiary, (ii) will
not conflict with or constitute a breach of, or Default under, or
result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of
its subsidiaries pursuant to, or require the consent of any other
party to,
7
any Existing
Instrument, and (iii) will not result in any violation of any
statute, law, rule, regulation, judgment, order or decree
applicable to the Company or any of its subsidiaries of any court,
regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company
or any of its subsidiaries or any of its or their properties. No
consent, approval, authorization or other order of, or registration
or filing with, any court or other governmental or regulatory
authority or agency is required for the Company’s execution,
delivery and performance of this Agreement and consummation of the
transactions contemplated hereby, by the Disclosure Package and by
the Prospectus, except (A) such as have been obtained or made
by the Company and are in full force and effect under the
Securities Act, applicable state securities or blue sky laws and
from the FINRA and (B) such as have been obtained under the
laws and regulations of jurisdictions outside the United States, if
any, in which Directed Shares are offered.
(q) No
Material Actions or Proceedings. Except as otherwise disclosed
in the Disclosure Package and the Prospectus, there are no legal or
governmental actions, suits or proceedings pending or, to the
Company’s knowledge, threatened (i) against or affecting
the Company or any of its subsidiaries, (ii) which has as the
subject thereof any officer or director of, or property owned or
leased by, the Company or any of its subsidiaries or
(iii) relating to environmental or employment discrimination
matters, where in any such case (A) there is a reasonable
possibility that such action, suit or proceeding might be
determined adversely to the Company or such subsidiary and
(B) any such action, suit or proceeding, if so determined
adversely, would reasonably be expected to have a Material Adverse
Effect or adversely affect the consummation of the transactions
contemplated by this Agreement.
(r) Labor
Matters. No material labor problem or dispute with the
employees of the Company or any of its subsidiaries exists or, to
the knowledge of the Company, is threatened or imminent, and the
Company is not aware of any existing or imminent labor disturbance
by the employees of any of its or its subsidiaries’ principal
suppliers, contractors or customers, that would reasonably be
expected to have a Material Adverse Effect.
(s)
Intellectual Property Rights. The Company and its
subsidiaries own, possess, license or have other rights to use, on
reasonable terms, all patents, patent applications, trade and
service marks, trade and service mark registrations, trade names,
copyrights, licenses, inventions, trade secrets, technology,
know-how and other intellectual property (collectively, the
“Intellectual Property”) necessary for the conduct of
the Company’s business as now conducted or as proposed in
each of the Disclosure Package and the Prospectus to be conducted.
Except as set forth in the Disclosure Package and the Prospectus,
(a) no party has been granted an exclusive license to use any
portion of such Intellectual Property owned by the Company;
(b) to the knowledge of the Company there is no material
infringement by third parties of any such Intellectual Property
owned by or exclusively licensed to the Company; (c) there is
no pending or, to the knowledge of the Company, threatened action,
suit, proceeding or claim by others challenging the Company’s
rights in or to any material Intellectual Property, and the Company
has no knowledge of any facts which would form a reasonable basis
for any such claim that, if subject to an unfavorable decision,
ruling or finding, would reasonably be expected to have a Material
Adverse Effect; (d) there is no pending or, to the knowledge
of the Company, threatened action, suit, proceeding or claim by
others challenging the validity or scope of any such Intellectual
Property, and the Company has no knowledge of any facts which would
form a
8
reasonable
basis for any such claim that, if subject to an unfavorable
decision, ruling or finding, would reasonably be expected to have a
Material Adverse Effect; and (e) there is no pending or, to
the knowledge of the Company, threatened action, suit, proceeding
or claim by others that the Company’s business as now
conducted infringes or otherwise violates any patent, trademark,
copyright, trade secret or other proprietary rights of others, and
the Company has no knowledge of any other fact which would form a
reasonable basis for any such claim that, if subject to an
unfavorable decision, ruling or finding, would reasonably be
expected to have a Material Adverse Effect.
(t) All
Necessary Permits, etc. The Company and each subsidiary possess
such valid and current licenses, certificates, authorizations or
permits issued by the appropriate state, federal or foreign
regulatory agencies or bodies necessary to conduct their respective
businesses, and neither the Company nor any subsidiary has received
any written notice of proceedings relating to the revocation or
modification of, or non-compliance with, any such license,
certificate, authorization or permit which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would reasonably be expected to have a Material Adverse
Effect.
(u) Title
to Properties. The Company and each of its subsidiaries has
good and marketable title to all the properties and assets
reflected as owned in the financial statements referred to in
Section 1(A)(m) above (or elsewhere in the Disclosure Package
and the Prospectus), in each case, other than in connection with
the Company’s credit agreement, free and clear of any
security interests, mortgages, liens, encumbrances, equities,
claims and other defects, except such as do not materially and
adversely affect the value of such property and do not materially
interfere with the use made or proposed to be made of such property
by the Company or such subsidiary, including, any such
mechanic’s, workmen’s, landlord’s,
materialmen’s, maritime as other similar liens incurred by
the Company in the ordinary course of business. The real property,
improvements, equipment and personal property held under lease by
the Company or any subsidiary are held under valid and enforceable
leases, with such exceptions as are not material and do not
materially interfere with the use made or proposed to be made of
such real property, improvements, equipment or personal property by
the Company or such subsidiary.
(v) Tax
Law Compliance. The Company and its consolidated subsidiaries
have filed all necessary federal, state, local and foreign income
and franchise tax returns in a timely manner (except in any case in
which any failure to file would not, singularly or in the
aggregate, reasonably be expected to result in a Material Adverse
Effect) and have paid all taxes reflected on such returns, and if
due and payable, any related or similar assessment, fine or penalty
levied against any of them, except for any taxes, assessments,
fines or penalties (i) as may be being contested in good faith
and by appropriate proceedings or (ii) in which any failure to
pay would not, singularly or in the aggregate, reasonably be
expected to result in a Material Adverse Effect. The Company has
made adequate charges, accruals and reserves in accordance with
GAAP in the applicable financial statements referred to in
Section 1(A)(m) above in respect of all federal, state, local
and foreign income and franchise taxes for all current or prior
periods as to which the tax liability of the Company or any of its
consolidated subsidiaries has not been finally
determined.
9
(w)
Company Not an “Investment Company”. The Company
is not, and after giving effect to the offering and sale of the
Shares as described in each of the preliminary prospectus and the
Prospectus will not be an “investment company” within
the meaning of the Investment Company Act of 1940, as amended (the
“Investment Company Act”) and will conduct its business
in a manner so that it will not become subject to the Investment
Company Act.
(x)
Insurance. Each of the Company and its subsidiaries are
insured by recognized and reputable institutions with policies in
such amounts and with such deductibles and covering such risks as
are generally deemed adequate and customary for their businesses
including, but not limited to, policies covering real and personal
property owned or leased by the Company and its subsidiaries
against theft, damage, destruction, acts of vandalism and
earthquakes. All policies of insurance and fidelity or surety bonds
insuring the Company or any of its subsidiaries or their respective
businesses, assets, employees, officers and directors are in full
force and effect; the Company and its subsidiaries are in
compliance with the terms of such policies and instruments in all
material respects; and there are no claims by the Company or any of
its subsidiaries under any such policy or instrument as to which
any insurance company is denying liability or defending under a
reservation of rights clause that, if subject to an unfavorable
decision, ruling or finding, would reasonably be expected to have a
Material Adverse Effect. Additionally, neither the Company nor any
such subsidiary has been refused any insurance coverage sought or
applied for that is material to the Company and neither the Company
nor any of its subsidiaries has received any written notice from
any of their current insurers that they will not be able to renew
their existing insurance coverage as and when such policies
expire.
(y) No
Restrictions on Dividends. No subsidiary of the Company is
currently prohibited, directly or indirectly, from paying any
dividends to the Company, from making any other distribution on
such subsidiary’s capital stock, from repaying to the Company
any loans or advances to such subsidiary from the Company or from
transferring any of such subsidiary’s property or assets to
the Company or any other subsidiary of the Company, except as
described in or incorporated by reference into the Disclosure
Package and the Prospectus.
(z) No
Price Stabilization or Manipulation. The Company has not taken
and will not take, directly or indirectly, any action designed to
or that might be reasonably expected to cause or result in
stabilization or manipulation of the price of the Common Stock to
facilitate the sale or resale of the Shares.
(aa)
Disclosure Controls. The Company and its subsidiaries
maintain an effective system of “disclosure controls and
procedures” (as defined in Rule 13a-15 of the Exchange
Act) that is designed to ensure that information required to be
disclosed by the Company in reports that it files or submits under
the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the Commission’s rules
and forms, including controls and procedures designed to ensure
that such information is accumulated and communicated to the
Company’s management as appropriate to allow timely decisions
regarding required disclosure. The Company and its subsidiaries
have carried out evaluations of the effectiveness of their
disclosure controls and procedures as required by Rule 13a-15
of the Exchange Act.
(bb)
Related Party Transactions. There are no business
relationships or related-party transactions involving the Company
or any subsidiary or any other person required to be described in
or incorporated by reference into the preliminary prospectus or the
Prospectus that have not been described or incorporated by
reference, as required.
10
(cc)
Internal Controls and Procedures . The Company maintains
(i) effective internal control over financial reporting as
defined in Rule 13a-15 under the Securities Exchange Act of
1934, as amended, and (ii) a system of internal accounting
controls sufficient to provide reasonable assurance that
(A) transactions are executed in accordance with
management’s general or specific authorizations;
(B) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset
accountability; (C) access to assets is permitted only in
accordance with management’s general or specific
authorization; and (D) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any
differences.
(dd) No
Material Weakness in Internal Controls. Except as disclosed in
the Disclosure Package and the Prospectus or in any document
incorporated by reference therein, 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.
(ee) No
Unlawful Contributions or Other Payments. Neither the Company
nor any of its subsidiaries nor, to the knowledge of the Company,
any director, officer, agent, employee or affiliate of the Company
or any of its subsidiaries has taken any action, directly or
indirectly, that would result in a violation by such Persons of the
FCPA, including, without limitation, making use of the mails or any
means or instrumentality of interstate commerce corruptly in
furtherance of an offer, payment, promise to pay or authorization
of the payment of any money, or other property, gift, promise to
give, or authorization of the giving of anything of value to any
“foreign official” (as such term is defined in the
FCPA) or any foreign political party or official thereof or any
candidate for foreign political office, in contravention of the
FCPA, and the Company, its subsidiaries and, to the knowledge of
the Company, its affiliates have conducted their businesses in
compliance with the FCPA and have instituted and maintain policies
and procedures designed to ensure, and which are reasonably
expected to continue to ensure, continued compliance
therewith.
“FCPA”
means Foreign Corrupt Practices Act of 1977, as amended, and the
rules and regulations thereunder.
(ff) No
Conflict with Money Laundering Laws. The operations of the
Company and its subsidiaries are and have been conducted at all
times in material compliance with applicable financial
recordkeeping and reporting requirements of the Currency and
Foreign Transactions Reporting Act of 1970, as amended, the money
laundering statutes of all applicable jurisdictions, the rules and
regulations thereunder and any related or similar rules,
regulations or guidelines issued, administered or enforced by any
governmental agency (collectively, the “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 Money Laundering Laws is pending or, to the knowledge of the
Company, threatened.
11
(gg) No
Conflict with OFAC Laws. Neither the Company nor any of its
subsidiaries nor, to the knowledge of the Company, any director,
officer, agent, employee or affiliate of the Company or any of its
subsidiaries is currently subject to any U.S. sanctions
administered by the Office of Foreign Assets Control of the U.S.
Treasury Department (“OFAC”).
(hh) Compliance
with Environmental Laws. Except as otherwise disclosed in or
incorporated by reference into the Disclosure Package and the
Prospectus, (i) neither the Company nor any of its
subsidiaries is in violation of any federal, state, local or
foreign law, regulation, order, permit or other requirement
relating to pollution or protection of human health or the
environment (including, without limitation, ambient air, surface
water, groundwater, land surface or subsurface strata) or wildlife,
including without limitation, laws and regulations relating to
emissions, discharges, releases or threatened releases of
chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum and petroleum products
(collectively, “Materials of Environmental Concern”),
or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of
Materials of Environmental Concern (collectively,
“Environmental Laws”), which violation includes, but is
not limited to, noncompliance with any permits or other
governmental authorizations required for the operation of the
business of the Company or its subsidiaries under applicable
Environmental Laws, or noncompliance with the terms and conditions
thereof, nor has the Company or any of its subsidiaries received
any written communication, whether from a governmental authority,
citizens group, employee or otherwise, that alleges that the
Company or any of its subsidiaries is in violation of any
Environmental Law, except as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect; (ii) there is no claim, action or cause of action
filed with a court or governmental authority, no investigation with
respect to which the Company has received written notice, and no
written notice received by the Company from any person or entity
alleging potential liability for investigatory costs, cleanup
costs, governmental responses costs, natural resources damages,
property damages, personal injuries, attorneys’ fees or
penalties arising out of, based on or resulting from the presence,
or release into the environment, of any Material of Environmental
Concern at any location owned, leased or operated by the Company or
any of its subsidiaries, now or in the past (collectively,
“Environmental Claims”), pending or, to the
Company’s knowledge, threatened against the Company or any of
its subsidiaries or any person or entity whose liability for any
Environmental Claim the Company or any of its subsidiaries has
retained or assumed either contractually or by operation of law,
except as would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect; (iii) to the
Company’s knowledge, there are no past, present or
anticipated future actions, activities, circumstances, conditions,
events or incidents, including, without limitation, the release,
emission, discharge, presence or disposal of any Material of
Environmental Concern, that could reasonably be expected to result
in a violation of any Environmental Law, require expenditures to be
incurred pursuant or relating to Environmental Law (including
expenditures, costs or liabilities required for clean-up, closure
of properties or compliance with Environmental Laws or related to
any permit, license or approval, any relating to any constraints on
operating activities and any potential liabilities to third
parties), or form the basis of a potential Environmental Claim
against the Company or any of its subsidiaries or against any
person or entity whose liability for any
12
Environmental
Claim the Company or any of its subsidiaries has retained or
assumed either contractually or by operation of law, except as
would not, individually or in the aggregate, have a Material
Adverse Effect; and (iv) neither the Company nor any of its
subsidiaries is subject to any pending or, to the knowledge of the
Company, threatened proceeding under Environmental Law to which a
governmental authority is a party and which is reasonably likely to
result in monetary sanctions of $100,000 or more.
(ii)
ERISA Compliance. None of the following events has occurred
or exists: (i) a failure to fulfill the obligations, if any,
under the minimum funding standards of Section 302 of the
United States Employee Retirement Income Security Act of 1974, as
amended (“ERISA”), and the regulations and published
interpretations thereunder with respect to a Plan, determined
without regard to any waiver of such obligations or extension of
any amortization period; (ii) an audit or investigation by the
Internal Revenue Service, the U.S. Department of Labor, the Pension
Benefit Guaranty Corporation or any other federal or state
governmental agency or any foreign regulatory agency with respect
to the employment or compensation of employees by the Company that
could have a Material Adverse Effect on the Company; or
(iii) any breach of any contractual obligation, or any
violation of law or applicable qualification standards, with
respect to the employment or compensation of employees by the
Company that could have a Material Adverse Effect. None of the
following events has occurred or is reasonably likely to occur:
(i) a material increase in the aggregate amount of
contributions required to be made to all Plans in the current
fiscal year of the Company compared to the amount of such
contributions made in the Company’s most recently completed
fiscal year; (ii) a material increase in the Company’s
“accumulated post-retirement benefit obligations”
(within the meaning of Statement of Financial Accounting Standards
106) compared to the amount of such obligations in the
Company’s most recently completed fiscal year; (iii) any
event or condition giving rise to a liability under Title IV of
ERISA that could have a Material Adverse Effect; or (iv) the
filing of a claim by one or more employees or former employees of
the Company related to a plan or arrangement of the Company that is
subject to ERISA that could have a Material Adverse Effect. For
purposes of this paragraph, the term “Plan” means a
plan (within the meaning of Section 3(3) of ERISA) subject to
Title IV of ERISA with respect to which any member of the Company
may have any liability.
(jj)
Brokers. Other than as required by the terms of this
Agreement, there is no broker, finder or other party that is
entitled to receive from the Company any brokerage or
finder’s fee or other fee or commission as a result of any
transactions contemplated by this Agreement.
(kk) No
Outstanding Loans or Other Indebtedness. There are no
outstanding loans, advances (except normal advances for business
expenses in the ordinary course of business) or guarantees or
indebtedness by the Company to or for the benefit of any of the
officers or directors of the Company or any of the members of any
of them, except as disclosed in the Disclosure Package and the
Prospectus.
(ll)
Sarbanes-Oxley Compliance. There is and has been no failure
on the part of the Company and any of the Company’s directors
or officers, in their capacities as such, to comply in all material
respects with any provision of the Sarbanes-Oxley Act of 2002 and
the rules and regulations promulgated in connection therewith (the
“Sarbanes-Oxley Act”), including Section 402
related to loans and Sections 302 and 906 related to
certifications.
13
(mm)
Subsidiaries. The subsidiaries listed on Annex A attached
hereto are the only significant subsidiaries of the Company as
defined by Rule 1-02 of Regulation S-X (the
“Subsidiaries”).
(nn)
Lending Relationship. Except as disclosed in the Disclosure
Package and the Prospectus, the Company does not have any material
lending or other relationship with any bank or lending affiliate of
any Underwriter.
(oo)
Statistical and Market Related Data. Nothing has come to the
attention of the Company that has caused the Company to believe
that the statistical and market-related data included in each of
the Disclosure Package and the Prospectus is not based on or
derived from sources that are reliable and accurate in all material
respects.
(pp)
Directed Share Program. The Company has not offered, or
caused the Underwriters to offer, and will not offer, or cause the
Underwriters to offer, any Directed Shares to any person living
outside of the United States or who is a resident of any country
other than the United States pursuant to the Directed Share
Program. Additionally, the Company has not offered, or caused the
Underwriters to offer, and will not offer, or cause the
Underwriters to offer, any Shares pursuant to the Directed Share
Program with the intent to unlawfully influence (i) a customer
or supplier of the Company to alter the customer’s or
supplier’s level or type of business with the Company or
(ii) a trade journalist or publication to write or publish
favorable information about the Company or its products.
(qq) No
Existing Lock-Up Agreements. There are no existing agreements
between the Company and any of its security holders entered into in
connection with the Company’s initial public offering that
prohibit the sale, transfer, assignment, pledge or hypothecation of
any of the Company’s securities.
Any certificate
signed by an officer of the Company and delivered to the
Representatives shall be deemed to be a representation and warranty
by the Company to each Underwriter as to the matters set forth
therein.
B. The
Selling Stockholder represents and warrants as of the date hereof,
as of the Applicable Time (as defined below), as of the Closing
Date referred to in Section 2 hereof and as of each Subsequent
Closing Date (if any) referred to in Section 2 hereof, and
covenants to each Underwriter as follows:
(a) The
Underwriting Agreement. This Agreement has been duly
authorized, executed and delivered by or on behalf of, and is a
valid and binding agreement of, the Selling Stockholder.
(b) Title to
Shares to be Sold. The Selling Stockholder (i) is, on the
Closing Date and on any Subsequent Closing Date, the record and
beneficial owner of, and has good and valid title to, the Shares,
and (ii) will, on the Closing Date and any Subsequent Closing
Date, own the Shares free and clear of all liens, encumbrances,
equities or claims, and has duly indorsed such Shares in blank, and
assuming that the Underwriters acquire their interest in the Shares
they have purchased without notice of any adverse claim (within the
meaning of Section 8-105 of the UCC), such Underwriters that
have purchased Shares delivered on the date hereof to DTC
by
14
making payment
therefor, as provided herein, and that have had such Shares
credited to the securities account or accounts of such Underwriters
maintained with DTC will have acquired a security entitlement
(within the meaning of Section&
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