EXHIBIT 1.2
QUANTA CAPITAL HOLDINGS LTD.
SHARES OF COMMON STOCK
UNDERWRITING AGREEMENT
December 14, 2005
FRIEDMAN, BILLINGS, RAMSEY & CO., INC.
as Representative of the several Underwriters
c/o Friedman, Billings, Ramsey & Co., Inc.
1001 19th Street North
Arlington, Virginia 22209
Dear Sirs:
Quanta Capital Holdings Ltd., a Bermuda exempted company (the
"Company") confirms its agreement with each of the Underwriters
listed on
Schedule I hereto (collectively, the "Underwriters"), for whom
Friedman,
Billings, Ramsey & Co., Inc. is acting as representative (in
such capacity, the
"Representative"), with respect to (i) the sale by the Company of
11,423,340
shares (the "Initial Shares") of Common Shares, par value $0.01 per
share, of
the Company ("Common Shares"), and the purchase by the
Underwriters, acting
severally and not jointly, of the respective number of shares of
Common Shares
set forth opposite the names of the Underwriters in Schedule I
hereto, and (ii)
the grant of the option described in Section 1(b) hereof to
purchase all or any
part of 1,713,501 additional shares of Common Shares to cover
over-allotments
(the "Option Shares"), if any, from the Company to the
Underwriters, acting
severally and not jointly, in the respective proportion as set
forth opposite
the names of the Underwriters in Schedule I hereto. The 11,423,340
shares of
Common Shares to be purchased by the Underwriters and all or any
part of the
1,713,501 shares of Common Shares subject to the option described
in Section
l(b) hereof are hereinafter called, collectively, the "Shares."
The Company understands that the Underwriters propose to make a
public
offering of the Shares as soon as the Underwriters deem advisable
after this
Agreement has been executed and delivered.
The Company has filed with the Securities and Exchange Commission
(the
Commission"), a registration statement on Form S-3 (No. 333-130115)
and a
related preliminary prospectus for the registration of the Shares
under the
Securities Act of 1933, as amended (the "Securities Act"), and the
rules and
regulations thereunder (the "Securities Act Regulations"). The
Company has
prepared and filed such amendments to the registration statement
and such
amendments or supplements to the related preliminary prospectus as
may have been
required to the date hereof, and will file such additional
amendments or
supplements as may hereafter be required. The registration
statement has been
declared effective under the Securities Act by the Commission. The
registration
statement, as amended at the time it was declared effective by the
Commission
(and, if the
Company files a post-effective amendment to such registration
statement which
becomes effective prior to the Closing Time (as defined below),
such
registration statement as so amended) and including all information
deemed to be
a part of the registration statement pursuant to incorporation by
reference,
Rule 430A of the Securities Act Regulations or otherwise, is
hereinafter called
the "Registration Statement." Any registration statement filed
pursuant to Rule
462(b) of the Securities Act Regulations is hereinafter called the
"Rule 462(b)
Registration Statement," and after such filing the term
"Registration Statement"
shall include the 462(b) Registration Statement. Each prospectus
included in the
Registration Statement before it was declared effective by the
Commission under
the Securities Act, and any preliminary form of prospectus filed
with the
Commission by the Company with the consent of the Underwriters
pursuant to Rule
424(a) of the Securities Act Regulations, including all information
incorporated
by reference in either such prospectus, is hereinafter called the
"Preliminary
Prospectus." The term "Prospectus" means the final prospectus, as
first filed
with the Commission pursuant to paragraph (1) or (4) of Rule 424(b)
of the
Securities Act Regulations, and any amendments thereof or
supplements thereto
including in either case all information incorporated by reference
therein.
The Commission has not issued any order preventing or suspending
the
use of any Preliminary Prospectus.
The term "Disclosure Package" means (i) the Preliminary Prospectus,
as
most recently amended or supplemented immediately prior to the
Initial Sale Time
(as defined herein), (ii) the Issuer Free Writing Prospectuses (as
defined
below), if any, identified in Schedule II hereto, and (iii) any
other Free
Writing Prospectus (as defined below) that the parties hereto shall
hereafter
expressly agree to treat as part of the Disclosure Package.
The term "Issuer Free Writing Prospectus" means any issuer free
writing prospectus, as defined in Rule 433 of the Securities Act
Regulations.
The term "Free Writing Prospectus" means any free writing
prospectus, as defined
in Rule 405 of the Securities Act Regulations.
The Company and the Underwriters agree as follows:
1.
Sale and Purchase:
(a) Initial Shares. Upon the basis of the warranties and
representations
and other terms and conditions herein set forth, at the purchase
price per share
of $4.48875, the Company agrees to sell to the Underwriters
11,423,340 Initial
Shares and each Underwriter agrees, severally and not jointly, to
purchase from
the Company the number of Initial Shares set forth in Schedule I
opposite such
Underwriter's name, plus any additional number of Initial Shares
which such
Underwriter may become obligated to purchase pursuant to the
provisions of
Section 9 hereof, subject in each case, to such
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adjustments among the Underwriters as the Representative in its
sole discretion
shall make to eliminate any sales or purchases of fractional
shares.
(b) Option Shares. In addition, upon the basis of the warranties
and
representations and other terms and conditions herein set forth, at
the purchase
price per share set forth in paragraph (a), the Company hereby
grants an option
to the Underwriters, acting severally and not jointly, to purchase
from the
Company, all or any part of the Option Shares, plus any additional
number of
Option Shares which such Underwriter may become obligated to
purchase pursuant
to the provisions of Section 9 hereof. The option hereby granted
will expire 30
days after the date hereof and may be exercised in whole or in part
from time to
time only for the purpose of covering over-allotments which may be
made in
connection with the offering and distribution of the Initial Shares
upon notice
by the Representative to the Company setting forth the number of
Option Shares
as to which the several Underwriters are then exercising the option
and the time
and date of payment and delivery for such Option Shares. Any such
time and date
of delivery shall be determined by the Representative, but shall
not be later
than three full business days (or earlier, without the consent of
the Company,
than two full business days) after the exercise of such option, nor
in any event
prior to the Closing Time, as hereinafter defined. If the option is
exercised as
to all or any portion of the Option Shares, the Company will sell
the total
number of Option Shares then being purchased and each of the
Underwriters,
acting severally and not jointly, will purchase that proportion of
the total
number of Option Shares then being purchased which the number of
Initial Shares
set forth in Schedule I opposite the name of such Underwriter bears
to the total
number of Initial Shares, subject in each case to such adjustments
among the
Underwriters as the Representative in its sole discretion shall
make to
eliminate any sales or purchases of fractional shares.
2.
Payment and Delivery:
(a) Initial Shares. The Shares to be purchased by each Underwriter
hereunder, in definitive form, and in such authorized denominations
and
registered in such names as the Representative may request upon at
least
forty-eight hours' prior notice to the Company shall be delivered
by or on
behalf of the Company to the Representative, including, at the
option of the
Representative, through the facilities of The Depository Trust
Company ("DTC")
for the account of such Underwriter, against payment by or on
behalf of such
Underwriter of the purchase price therefor by wire transfer of
Federal
(same-day) funds to the account specified to the Representative by
the Company
upon at least forty-eight hours' prior notice. The Company will
cause the
certificates representing the Initial Shares to be made available
for checking
and packaging not later than 1:00 p.m. New York City time on the
business day
prior to the Closing Time (as defined below) with respect thereto
at the office
of Friedman, Billings, Ramsey & Co., Inc., 1001 19th Street
North, Arlington,
Virginia 22209, or at the office of DTC or its designated
custodian, as the case
may be (the "Designated Office"). The time and date of such
delivery and payment
shall be 9:30 a.m., New York City time, on the fourth business day
after the
date hereof (unless another time and date shall be agreed to by the
Representative and the
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Company). The time at which such payment and delivery of both
Initial Shares and
Option Shares are actually made is hereinafter sometimes called the
"Closing
Time" and the date of delivery of both Initial Shares and Option
Shares is
hereinafter sometimes called the "Date of Delivery."
(b) Option Shares. Any Option Shares to be purchased by each
Underwriter
hereunder, in definitive form, and in such authorized denominations
and
registered in such names as the Representative may request upon at
least
forty-eight hours' prior notice to the Company shall be delivered
by or on
behalf of the Company to the Representative, including, at the
option of the
Representative, through the facilities of DTC for the account of
such
Underwriter, against payment by or on behalf of such Underwriter of
the purchase
price therefor by wire transfer of Federal (same-day) funds to the
account
specified to the Representative by the Company upon at least
forty-eight hours'
prior notice. The Company will cause the certificates representing
the Option
Shares to be made available for checking and packaging at least
twenty-four
hours prior to the Date of Delivery with respect thereto at the
Designated
Office. The time and date of such delivery and payment shall be
9:30 a.m., New
York City time, on the date specified by the Representative in the
notice given
by the Representative to the Company of the Underwriters' election
to purchase
such Option Shares or on such other time and date as the Company
and the
Representative may agree upon in writing.
3.
Representations and Warranties of the Company:
The Company represents and warrants to the Underwriters that:
(a) the Company has an authorized capitalization as set forth in
both the
Prospectus and the Disclosure Package; the outstanding shares of
capital stock
of the Company and each material subsidiary of the Company (each, a
"Subsidiary") that is a corporation have been duly and validly
authorized and
issued and are fully paid and non-assessable, and all of the
outstanding shares
of capital stock of the Subsidiaries that are corporations are
directly or
indirectly owned of record and beneficially by the Company and all
of the
membership interests in each Subsidiary that is a limited liability
company have
been duly and validly authorized and issued and fully paid, and all
of the
outstanding membership interests in each Subsidiary that is a
limited liability
company are directly or indirectly owned of record and beneficially
by the
Company; except as disclosed in both the Prospectus and the
Disclosure Package,
there are no outstanding (i) securities or obligations of the
Company or any of
the Subsidiaries convertible into or exchangeable for any capital
stock or
membership interests of the Company or any such Subsidiary, (ii)
warrants,
rights or options to subscribe for or purchase from the Company or
any such
Subsidiary any such capital stock or membership interests or any
such
convertible or exchangeable securities or obligations, or (iii)
obligations of
the Company or any such Subsidiary to issue any shares of capital
stock or
membership interests, any such convertible or exchangeable
securities or
obligation, or any such warrants, rights or options;
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(b) each of the Company and the Subsidiaries (all Subsidiaries of
which are
named in Exhibit 21 to the Company's Annual Report for 2004 on Form
10-K) has
been duly incorporated or formed and is validly existing as a
corporation or
limited liability company, as applicable, in good standing under
the laws of its
respective jurisdiction of organization with full corporate or
limited liability
company, as applicable, power and authority to own its respective
properties and
to conduct its respective businesses as described in each of the
Registration
Statement, the Prospectus and the Disclosure Package and, in the
case of the
Company, to execute and deliver this Agreement and to consummate
the
transactions contemplated herein;
(c) the Company and all of the Subsidiaries are duly qualified or
licensed
and are in good standing in each jurisdiction in which they conduct
their
respective businesses or in which they own or lease real property
or otherwise
maintain an office and in which the failure, individually or in the
aggregate,
to be so qualified or licensed would reasonably be expected to have
a material
adverse effect on the assets, business, operations, earnings,
prospects,
properties or condition (financial or otherwise), present or
prospective, of the
Company and the Subsidiaries taken as a whole, (any such effect or
change, where
the context so requires, is hereinafter called a "Material Adverse
Effect" or
"Material Adverse Change"); except as disclosed in both the
Prospectus and the
Disclosure Package, no Subsidiary is prohibited or restricted,
directly or
indirectly, in any material respect from paying dividends to the
Company, or
from making any other distribution with respect to such
Subsidiary's capital
stock or from repaying to the Company or any other Subsidiary any
amounts which
may from time to time become due under any loans or advances to
such Subsidiary
from the Company or such other Subsidiary, or from transferring any
such
Subsidiary's property or assets to the Company or to any other
Subsidiary; other
than as disclosed in both the Prospectus and the Disclosure
Package, the Company
does not own, directly or indirectly, any capital stock or other
equity
securities of any other corporation or any ownership interest in
any
partnership, joint venture or other association;
(d) the Company and the Subsidiaries are in compliance in all
material
respects with all applicable laws, rules, regulations, orders,
decrees and
judgments, including those relating to transactions with
affiliates, except
where the failure to comply would not reasonably be expected to
have a Material
Adverse Effect;
(e) neither the Company nor any Subsidiary is in breach of or in
default
under (nor has any event occurred which with notice, lapse of time,
or both
would constitute a breach of, or default under), its respective
organizational
documents, or in the performance or observance of any obligation,
agreement,
covenant or condition contained in any license, indenture,
mortgage, deed of
trust, loan or credit agreement or other agreement or instrument to
which the
Company or any Subsidiary is a party or by which any of them or
their respective
properties is bound, except for such breaches or defaults which
would not
reasonably be expected to, individually or in the aggregate, have a
Material
Adverse Effect;
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(f) the execution, delivery and performance of this Agreement, and
consummation of the transactions contemplated herein will not (A)
conflict with,
or result in any breach of, or constitute a default under (nor
constitute any
event which with notice, lapse of time, or both would constitute a
breach of, or
default under), (i) any provision of the organizational documents
of the Company
or any Subsidiary, or (ii) any provision of any license, indenture,
mortgage,
deed of trust, loan or credit agreement or other agreement or
instrument to
which the Company or any Subsidiary is a party or by which any of
them or their
respective properties may be bound or affected, or under any
federal, state,
local or foreign law, regulation or rule or any decree, judgment or
order
applicable to the Company or any Subsidiary, except in the case of
this clause
(ii) for such breaches or defaults which would not reasonably be
expected to,
individually or in the aggregate, have a Material Adverse Effect;
or (B) result
in the creation or imposition of any lien, charge, claim or
encumbrance upon any
property or asset of the Company or any Subsidiary;
(g) this Agreement has been duly authorized, executed and delivered
by the
Company and is a legal, valid and binding agreement of the Company
enforceable
in accordance with its terms, except as may be limited by
bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
creditors'
rights generally, and by general equitable principles, and except
to the extent
that the indemnification and contribution provisions of Section 10
hereof may be
limited by federal or state securities laws and public policy
considerations in
respect thereof;
(h) no approval, authorization, consent or order of or filing with
any
federal, state or local governmental or regulatory commission,
board, body,
authority or agency, domestic or foreign, is required in connection
with the
Company's execution, delivery and performance of this Agreement,
its
consummation of the transactions contemplated herein, and its sale
and delivery
of the Shares, other than (A) such as have been obtained, or will
have been
obtained at the Closing Time or the relevant Date of Delivery, as
the case may
be, under the Securities Act and the Securities Exchange Act of
1934 (the
"Exchange Act"), (B) such approvals as have been obtained in
connection with the
approval of the quotation of the Shares on NASDAQ, (C) any
necessary
qualification under the securities or blue sky laws of the various
jurisdictions
in which the Shares are being offered by the Underwriters, (D) such
approvals,
authorizations, consents, orders or filings under the rules and
regulations of
the NASD and (E) such filings and approvals as may be required in
such
jurisdictions outside the United States where the Underwriters
choose to market
the Shares and such as may be required and have been obtained from
the Bermuda
Monetary Authority;
(i) each of the Company and the Subsidiaries has all necessary
licenses,
authorizations, consents and approvals and has made all necessary
filings
required under any federal, state or local law, regulation or rule,
domestic or
foreign, and has obtained all necessary authorizations, consents
and approvals
from other persons, required in order to conduct their respective
businesses as
described in both the Prospectus and the Disclosure
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Package, except to the extent that any failure to have any such
licenses,
authorizations, consents or approvals, to make any such filings or
to obtain any
such authorizations, consents or approvals would not reasonably be
expected to,
individually or in the aggregate, have a Material Adverse Effect;
neither the
Company nor any of the Subsidiaries is required by any applicable
law to obtain
accreditation or certification from any governmental agency or
authority in
order to provide the products and services which it currently
provides or which
it proposes to provide as set forth in both the Prospectus and the
Disclosure
Package, except for such accreditations or certifications that the
failure of
which to obtain would not reasonably be expected to individually or
in the
aggregate, have a Material Adverse Effect; neither the Company nor
any of the
Subsidiaries is in violation of, in default under, or has received
any notice
regarding a possible violation, default or revocation of any such
license,
authorization, consent or approval or any federal, state, domestic
or foreign
law, regulation or rule or any decree, order or judgment, domestic
or foreign,
applicable to the Company or any of the Subsidiaries the effect of
which would
reasonably be expected to result in a Material Adverse Change;
(j) each of the Registration Statement and any Rule 462(b)
Registration
Statement has become effective under the Securities Act and no stop
order
suspending the effectiveness of the Registration Statement or any
Rule 462(b)
Registration Statement has been issued under the Securities Act and
no
proceedings for that purpose have been instituted or are pending
or, to the
knowledge of the Company, are contemplated or threatened by the
Commission, and
the Company has complied to the Commission's satisfaction with any
request on
the part of the Commission for additional information;
(k) the Preliminary Prospectus and the Prospectus when filed and
the
Registration Statement as of each effective date and as of the date
hereof
complied or will comply, and the Prospectus and any further
amendments or
supplements to the Registration Statement, the Preliminary
Prospectus or the
Prospectus will, when they become effective or are filed with the
Commission, as
the case may be, comply, in all material respects with the
requirements of the
Securities Act and the Securities Act Regulations;
(l) the Registration Statement, as of each effective date and as of
the
date hereof, did not, does not and will not contain an untrue
statement of a
material fact or omit to state a material fact required to be
stated therein or
necessary to make the statements therein not misleading; and the
Preliminary
Prospectus does not, and the Prospectus as supplemented by any
Issuer Free
Writing Prospectus or any amendment or supplement thereto will not,
as of the
applicable filing date and at the Closing Time and on each Date of
Delivery (if
any), contain an untrue statement of a material fact or omit to
state a material
fact necessary to make the statements therein, in the light of the
circumstances
under which they were made, not misleading; provided, however, that
the Company
makes no warranty or representation with respect to any statement
contained in
or omitted from the Registration Statement, the Preliminary
Prospectus or the
Prospectus in reliance upon and in conformity with the information
concerning
the Underwriters and
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furnished in writing by or on behalf of the Underwriters through
the
Representative to the Company expressly for use therein (that
information being
limited to that described in the last sentence of the first
paragraph of Section
10(b) hereof);
(m) each document incorporated by reference in the Prospectus and
the
Disclosure Package, when it became effective or was 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, and the
Securities Act
Regulations and the Exchange Act Regulations, and none of such
documents
contained an 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, in the light of the circumstances under which they were
made, not
misleading; and any further documents so filed and incorporated by
reference in
the Prospectus and the Disclosure Package 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
Securities Act
Regulations and the rules and regulations under the Exchange Act
(the "Exchange
Act Regulations") and will not include an 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, in the light of the
circumstances under
which they were made, not misleading;
(n) as of 6:00 p.m. (Eastern time) on the date of this Agreement
(the
"Initial Sale Time"), the Disclosure Package did not, and at each
Closing Time,
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; provided, however, that the Company makes no warranty
or
representation with respect to any statement contained in or
omitted from the
Disclosure Package in reliance upon and in conformity with the
information
concerning the Underwriters and furnished in writing by or on
behalf of the
Underwriters through the Representative to the Company expressly
for use therein
(that information being limited to that described in the last
sentence of the
first paragraph of Section 10(b) hereof);
(o) each Issuer Free Writing Prospectus, as of its issue date and
at all
subsequent times through the completion of the public offer and
sale of the
Shares did not, does not and will not include any information that
conflicted,
conflicts or will conflict with the information contained in the
Registration
Statement, including any document incorporated by reference therein
that has not
been superseded or modified;
(p) the Company is eligible to use Free Writing Prospectuses in
connection
with this offering pursuant to Rules 164 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 Regulations has been, or will be,
filed with the
Commission in accordance with the Securities Act Regulations; and
each Free
Writing Prospectus that the Company
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has filed, or is required to file, pursuant to Rule 433(d) under
the Securities
Act Regulations or that was prepared by or on behalf of or used by
the Company
complies or will comply in all material respects with the
requirements of the
Securities Act and the Securities Act Regulations;
(q) except for the Issuer Free Writing Prospectuses, if any,
identified in
Schedule II hereto, and any electronic road show relating to the
offering, the
Company has not prepared, used or referred to, and will not,
without the prior
consent of the Representative, prepare, use or refer to, any Free
Writing
Prospectus;
(r) the Preliminary Prospectus, the Prospectus and any Issuer Free
Writing
Prospectuses (to the extent any such Issuer Free Writing Prospectus
was required
to be filed with the Commission) delivered to the Underwriters for
use in
connection with this offering have been and will be identical to
the versions of
such documents transmitted to the Commission for filing via the
Electronic Data
Gathering Analysis and Retrieval System ("EDGAR"), except to the
extent
permitted by Regulation S-T;
(s) the Company filed the Registration Statement with the
Commission before
using any Issuer Free Writing Prospectus;
(t) there are no actions, suits, proceedings, inquiries or
investigations
pending or, to the knowledge of the Company, threatened against the
Company or
any Subsidiary or any of their respective officers and directors or
to which the
properties, assets or rights of any such entity are subject, at law
or in
equity, before or by any federal, state, local or foreign
governmental or
regulatory commission, board, body, authority, arbitral panel or
agency which
would not reasonably be expected to result in a judgment, decree,
award or order
having a Material Adverse Effect;
(u) the financial statements, including the notes thereto, included
in (or
incorporated by reference into) each of the Registration Statement,
the
Prospectus and the Disclosure Package present fairly the
consolidated financial
position of the entities to which such financial statements relate
(the "Covered
Entities") as of the dates indicated and the consolidated results
of operations
and changes in financial position and cash flows of the Covered
Entities for the
periods specified; such financial statements have been prepared in
conformity
with generally accepted accounting principles as applied in the
United States
and on a consistent basis during the periods involved and in
accordance with
Regulation S-X promulgated by the Commission; the financial
statement schedules
included in the Registration Statement and the amounts in both the
Prospectus
and the Disclosure Package under the captions "Prospectus Summary -
Summary
Historical Consolidated Financial Information" and "Selected
Historical
Consolidated Financial Information" fairly present the information
shown therein
and have been compiled on a basis consistent with the financial
statements
included in each of the Registration Statement, the Prospectus and
the
Disclosure Package; the amounts in both the Prospectus and the
Disclosure
Package in the table under the caption "Prospectus Summary - Recent
Developments" and under the caption "Capitalization" fairly present
in
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all material respects the information shown therein and have been
compiled on a
basis consistent with the financial statements included in each of
the
Registration Statement, the Prospectus and the Disclosure Package;
no other
financial statements or supporting schedules are required to be
included in the
Registration Statement, the Prospectus or the Disclosure Package;
(v) to the best of the Company's knowledge, PricewaterhouseCoopers
LLP,
whose reports on the consolidated financial statements of the
Company and the
Subsidiaries are filed with the Commission as part of each of the
Registration
Statement, the Prospectus and the Disclosure Package or are
incorporated by
reference therein, and any other accounting firm that has certified
Company
financial statements and delivered its reports with respect
thereto, are, and
were during the periods covered by their reports, independent
registered public
accounting firms as required by the Securities Act and the
Securities Act
Regulations registered with the Public Company Accounting Oversight
Board;
(w) subsequent to the respective dates as of which information is
given in
each of the Registration Statement, the Prospectus and the
Disclosure Package,
and except as may be otherwise stated in such documents, there has
not been (A)
any Material Adverse Change or any development that could
reasonably be expected
to result in a Material Adverse Change, whether or not arising in
the ordinary
course of business, (B) any transaction that is material to the
Company and the
Subsidiaries taken as a whole, contemplated or entered into by the
Company or
any of the Subsidiaries other than in the ordinary course of
business, (C) any
obligation, contingent or otherwise, directly or indirectly
incurred by the
Company or any Subsidiary outside the ordinary course that is
material to the
Company and Subsidiaries taken as a whole or (D) any dividend or
distribution of
any kind declared, paid or made by the Company on any class of its
capital
stock;
(x) the Shares conform in all material respects to the description
thereof
contained in the Registration Statement, the Prospectus and the
Disclosure
Package;
(y) there are no persons with registration or other similar rights
to have
any equity or debt securities, including securities which are
convertible into
or exchangeable for equity securities, registered pursuant to the
Registration
Statement in connection with the sale of the Shares or otherwise
registered by
the Company under the Securities Act, except for those registration
or similar
rights which have been waived with respect to the offering
contemplated by this
Agreement, all of which registration or similar rights are fairly
summarized in
the Prospectus;
(z) the Shares have been duly authorized and, when issued and duly
delivered against payment therefor as contemplated by this
Agreement, will be
validly issued, fully paid and non-assessable, free and clear of
any pledge,
lien, encumbrance, security interest or other claim (except as set
forth in the
Company's Bye-laws), and the issuance and sale of the Shares by the
Company is
not subject to preemptive or other similar rights arising
-10-
by operation of law, under the organizational documents of the
Company or under
any agreement to which the Company or any Subsidiary is a party or
otherwise;
(aa) the Shares have been approved for listing on NASDAQ, subject
to
official notice of issuance;
(bb) the Company has not taken, and will not take, directly or
indirectly,
any action which is designed to or which has constituted or which
might
reasonably be expected to cause or result in stabilization or
manipulation of
the price of any security of the Company to facilitate the sale or
resale of the
Shares;
(cc) neither the Company nor any of its affiliates (i) is required
to
register as a "broker" or "dealer" in accordance with the
provisions of the
Exchange Act, or the Exchange Act Regulations, or (ii) directly, or
indirectly
through one or more intermediaries, controls or has any other
association with
(within the meaning of Article I of the By-laws of the National
Association of
Securities Dealers, Inc. (the "NASD")) any member firm of the NASD;
(dd) the Company has not relied upon the Representative or legal
counsel
for the Representative for any legal, tax or accounting advice in
connection
with the offering and sale of the Shares;
(ee) any certificate signed by any officer of the Company or any
Subsidiary
delivered to the Representative or to counsel for the Underwriters
pursuant to
or in connection with this Agreement shall be deemed a
representation and
warranty by the Company to each Underwriter as to the matters
covered thereby;
(ff) the form of certificate used to evidence the Common Shares
complies in
all material respects with all applicable statutory requirements,
with any
applicable requirements of the organizational documents of the
Company and the
requirements of the NASDAQ;
(gg) the Company and the Subsidiaries have good and marketable
title in fee
simple to all real property, if any, and good title to all personal
property
owned by them, in each case free and clear of all liens, security
interests,
pledges, charges, encumbrances, mortgages and defects, except such
as are
disclosed in both the Prospectus and the Disclosure Package or such
as do not
materially and adversely affect the value of such property and do
not interfere
with the use made or proposed to be made of such property by the
Company and the
Subsidiaries; and any real property and buildings held under lease
by the
Company or any Subsidiary are held under valid, existing and
enforceable leases,
with such exceptions as are disclosed in both the Prospectus and
the Disclosure
Package or are not material to the Company and its Subsidiaries as
a whole and
do not interfere with the use made or proposed to be made of such
property and
buildings by the Company or such Subsidiary;
-11-
(hh) the descriptions in each of the Registration Statement, the
Prospectus
and the Disclosure Package of the legal or governmental
proceedings, contracts,
leases and other legal documents therein described present fairly
in all
material respects the information required to be shown, and there
are no legal
or governmental proceedings, contracts, leases, or other documents
of a
character required to be described in the Registration Statement,
the Prospectus
or the Disclosure Package or to be filed as exhibits to the
Registration
Statement which are not described or filed as required; all
agreements between
the Company or any of the Subsidiaries and third parties expressly
referenced in
both the Prospectus and the Disclosure Package are legal, valid and
binding
obligations of the Company or one or more of the Subsidiaries,
enforceable in
accordance with their respective terms, except to the extent
enforceability may
be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws
affecting creditors' rights generally and by general equitable
principles;
(ii) the Company and each Subsidiary owns or possesses adequate
licenses or
other rights to use all patents, trademarks, service marks, trade
names,
copyrights, software and design licenses, trade secrets,
manufacturing
processes, other intangible property rights and know-how
(collectively
"Intangibles") necessary to entitle the Company and each Subsidiary
to conduct
its business as described in both the Prospectus and the Disclosure
Package
except where the failure to own or possess, or to be able to
acquire, such
Intangibles would reasonably be expected to have a Material Adverse
Effect, and
neither the Company nor any Subsidiary has received notice of
infringement of or
conflict with (and the Company knows of no such infringement of or
conflict
with) asserted rights of others with respect to any Intangibles
which would
reasonably be expected to have a Material Adverse Effect;
(jj) (x) the Company has established and maintains disclosure
controls and
procedures (as such term is defined in Rule 13a-15(e) under the
Exchange Act),
which (i) are designed to ensure that material information relating
to the
Company, including its consolidated subsidiaries, is made known to
the Company's
principal executive officer and its principal financial officer by
others within
those entities, particularly during the periods in which the
periodic reports
required under the Exchange Act are being prepared, (ii) have been
evaluated for
effectiveness as of the end of the last fiscal quarter covered by
the
Registration Statement, and (iii) are effective in all material
respects to
perform the functions for which they were established, and (y)
based on the
evaluation of the Company's disclosure controls and procedures
described above,
the Company is not aware of (i) any significant deficiency or
material weakness
in the design or operation of internal control over financial
reporting which
are reasonably likely to adversely affect the Company's ability to
record,
process, summarize and report financial information, or (ii) any
fraud, whether
or not material, that involves management or other employees who
have a
significant role in the Company's internal control over financial
reporting.
Since the most recent evaluation of the Company's disclosure
controls and
procedures described above, there have been no significant changes
in internal
control over financial reporting or in other factors that could
significantly
affect internal control over financial reporting;
-12-
(kk) the Company is not aware of any significant deficiency or
material
weaknesses existing in the design or implementation of the internal
controls
over financial reporting of the Company that adversely affects the
Company's
ability to record, process, summarize and report to management or
the Board of
Directors material financial information relating to the Company;
(ll) each of the Company and the Subsidiaries has filed on a timely
basis
all necessary federal, state, local and foreign income and
franchise tax returns
required to be filed through the date hereof and have paid all
taxes shown as
due thereon other than those being contested in good faith and for
which
adequate reserves have been provided or any of those currently
payable without
penalty or interest; and no tax deficiency has been asserted
against any such
entity, nor does any such entity know of any tax deficiency which
has been
threatened against any such entity which, if determined adversely
to any such
entity, could have a Material Adverse Effect; all tax liabilities
are adequately
provided for on the respective books of such entities;
(mm) each of the Company and the Subsidiaries maintains insurance
(issued
by insurers of recognized financial responsibility) of the types
and in the
amounts generally deemed adequate for their respective businesses
and consistent
with insurance coverage maintained by similar companies in similar
businesses,
including, but not limited to, insurance covering real and personal
property
owned or leased by the Company and the Subsidiaries against theft,
damage,
destruction, acts of vandalism and all other risks customarily
insured against,
all of which insurance is in full force and effect;
(nn) neither the Company nor any of the Subsidiaries is in
violation, or
has received notice of any violation with respect to, any
applicable
environmental, safety or similar law applicable to the business of
the Company
or any of the Subsidiaries; the Company and the Subsidiaries have
received all
permits, licenses or other approvals required of them under
applicable federal
and state occupational safety and health and environmental laws and
regulations
to conduct their respective businesses, and the Company and the
Subsidiaries are
in compliance with all terms and conditions of any such permit,
license or
approval, except any such violation of law or regulation, failure
to receive
required permits, licenses or other approvals or failure to comply
with the
terms and conditions of such permits, licenses or approvals which
would not
reasonably be expected to, individually or in the aggregate, result
in a
Material Adverse Change;
(oo) neither the Company nor any Subsidiary is in violation of or
has
received notice of any violation with respect to any federal or
state law
relating to discrimination in the hiring, promotion or pay of
employees, nor any
applicable federal or state wages and hours law, nor any state law
precluding
the denial of credit due to the neighborhood in which a property is
situated,
the violation of any of which would reasonably be expected to have
a Material
Adverse Effect;
-13-
(pp) the Company and each of the 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 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 the Subsidiaries would have
any
liability; the Company and each of the 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)
Section 412 or
4971 of the Internal Revenue Code of 1986, as amended, including
the regulations
and published interpretations thereunder ("Code"); and each
"pension plan" for
which the Company and each 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;
(qq) neither the Company nor any of the Subsidiaries nor, to the
best of
the Company's knowledge, any officer or director purporting to act
on behalf of
the Company or any of the Subsidiaries has at any time (i) made any
contributions to any candidate for political office, or failed to
disclose fully
any such contributions, in violation of law, (ii) made any payment
to any state,
federal or foreign governmental officer or official, or other
person charged
with similar public or quasi-public duties, other than payments
required or
allowed by applicable law, (iii) made any payment outside the
ordinary course of
business to any investment officer or loan broker or person charged
with similar
duties of any entity to which the Company or any of the
Subsidiaries sells or
from which the Company or any of the Subsidiaries buys loans or
servicing
arrangements for the purpose of influencing such agent, officer,
broker or
person to buy loans or servicing arrangements from or sell loans to
the Company
or any of the Subsidiaries, or (iv) engaged in any transactions,
maintained any
bank account or used any corporate funds except for transactions,
bank accounts
and funds which have been and are reflected in the normally
maintained books and
records of the Company and the Subsidiaries;
(rr) except as otherwise disclosed in both the Prospectus and the
Disclosure Package, there are no material outstanding loans,
extensions of
credit or advances or material guarantees of indebtedness by the
Company or any
of the Subsidiaries to or for the benefit of any of
