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EXHIBIT 1.1
1,600,000 UNITS
UNISERVICE CORPORATION
UNDERWRITING AGREEMENT
October __, 2000
Werbel-Roth Securities, Inc.
As Representatives of the Several Underwriters
c/o Werbel-Roth Securities, Inc.
150 East Palmetto Park Road, Suite 510
Boca Raton, Florida 33432
Dear Sirs:
Uniservice Corporation, a Florida corporation (the "COMPANY"), proposes
to issue and sell to the several Underwriters named in Schedule I hereto (the
"UNDERWRITERS") an aggregate of 1,600,000 units, each unit consisting of one
share of its Series A 6% Convertible Cumulative Redeemable Preferred Stock
("PREFERRED STOCK") and one warrant to purchase one share of Class A common
stock ("WARRANTS"). The 1,600,000 units to be issued and sold to the
Underwriters by the Company are hereinafter referred to as the "FIRM UNITS." The
Company also proposes to sell to you (the "Representative"), upon the terms and
conditions set forth in Section 2 hereof, up to an additional 240,000 units (the
"ADDITIONAL UNITS") to cover over-allotments (the "OVER-ALLOTMENT OPTION").
The Company also proposes to sell to you, upon the terms and conditions
set forth in a separate Warrant Agreement (the "REPRESENTATIVE'S WARRANT") a
warrant to purchase an additional 160,000 units. The shares of Preferred Stock
issuable upon exercise of the Representative's Warrant and the Warrants are
hereinafter referred to as the "WARRANT SHARES," and the Warrants issuable upon
exercise of the Representative's Warrant are hereinafter referred to as the
"WARRANT WARRANTS." The Firm Units and the Additional Units are hereinafter
collectively referred to as the "OFFERING SECURITIES." The Warrant Shares and
the Warrant Warrants are hereinafter collectively referred to as the "WARRANT
SECURITIES." The Offering Securities and the Warrant Securities are hereinafter
referred to as the "SECURITIES."
The Company wishes to confirm as follows its agreements with the
Representative and the other several Underwriters on whose behalf you are
acting, in connection with the several purchases of the Securities by the
Underwriters and of the Warrant Securities by you.
1. REGISTRATION STATEMENT AND PROSPECTUS. The Company has prepared and
FILED with the Securities and Exchange Commission (the "COMMISSION") in
accordance with the
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provisions of the Securities Act of 1933, as amended, and the rules and
regulations of the Commission thereunder (collectively, the "ACT"), a
registration statement on Form SB-2 under the Act (the "REGISTRATION
STATEMENT"), including a prospectus subject to completion relating to the
Securities. The term "REGISTRATION STATEMENT" as used in this Agreement means
the registration statement (including all financial schedules and exhibits), as
amended at the time it becomes effective, or, if the registration statement
became effective prior to the execution of this Agreement, as supplemented or
amended prior to the execution of this Agreement. If it is contemplated, at the
time this Agreement is executed, that a post-effective amendment to the
registration statement will be filed and must be declared effective before the
offering of the Securities may commence, the term "REGISTRATION STATEMENT" as
used in this Agreement means the registration statement as amended by said
post-effective amendment. The term "PROSPECTUS" as used in this Agreement means
the prospectus in the form included in the Registration Statement, or, if the
prospectus included in the Registration Statement omits information in reliance
on Rule 430A under the Act and such information is included in a prospectus
filed with the Commission pursuant to Rule 424(b) under the Act, the term
"PROSPECTUS" as used in this Agreement means the prospectus in the form included
in the Registration Statement as supplemented by the addition of the Rule 430A
infon-nation contained in the prospectus filed with the Commission pursuant to
Rule 424(b). The term "PREPRICING PROSPECTUS" as used in this Agreement means
the prospectus subject to completion in the form included in the registration
statement at the time of the initial filing of the registration statement with
the Commission, and as such prospectus shall have been amended from time to time
prior to the date of the Prospectus.
2. AGREEMENTS TO SELL AND PURCHASE. Subject to such adjustments as you
may determine in order to avoid fractional shares, the Company hereby agrees,
subject to all the terms and conditions set forth herein, to issue and sell to
each Underwriter and, upon the basis of the representations, warranties and
agreements of the Company contained and subject to all the terms and conditions
set forth herein, each Underwriter agrees, severaIly and not jointly, to
purchase from the Company, at a purchase price of 90% of the public offering
price per unit at the time described herein to be sold by the Underwriter, at an
initial purchase price of $5.00 per unit (the "PURCHASE PRICE PER UNIT"), the
number of Firm Units set forth opposite the name of such Underwriter in Schedule
I hereto (or such number of Firm Units increased as set forth in Section 10
hereof).
The Company also agrees, subject to all the terms and conditions set
forth herein, to sell to the Representative, and, upon the basis of the
representations, warranties and agreements of the Company herein contained and
subject to all the terms and conditions set forth herein, the Representative
shall have the right to purchase from the Company, at the purchase price per
unit, pursuant to the Over-Allotment Option which may be exercised at any time
and from time to time prior to 9:00 P.M., Eastern time, on the 45th day after
the date of the Prospectus (or, if such 45th day shall be a Saturday or Sunday
or a holiday, on the next business day thereafter when the New York Stock
Exchange is open for trading), up to an aggregate of 240,000 Additional Units
from the Company. Additional Units may be purchased only for the purpose of
covering over allotments made in connection with the offering of the Firm Units.
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3. TERMS OF PUBLIC OFFERING. The Company has been advised by you that
the Underwriters propose to make a public offering of their respective portions
of the Securities as soon after the Registration Statement and this Agreement
have become effective as in your judgment is advisable and initially to offer
the Offering Securities upon the terms set forth in the Prospectus.
4. DELIVERY OF THE OFFERING SECURITIES AND PAYMENT THEREFOR. Payment
for the Shares shall be made on the Closing Date by wire transfer to the
Company, upon delivery of certificates (in form and substance satisfactory to
the Underwriter) representing the Preferred Stock and the Warrants or by
confirmation of electronic transfer of the Preferred Stock and Warrants by or on
behalf of the Company to the Underwriter, 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 (sameday) funds to the account specified by the Company
to the Underwriter at least forty-eight hours in advance. The Company will cause
the certificates representing the Preferred Stock and Warrants to be made
available for checking and packaging at least twenty-four hours prior to the
Time of Delivery (as defined below) with respect thereto at the office of DTC or
its designated custodian (the "Designated Office"). Delivery and payment for the
Preferred Stock and Warrants shall be made at 10:00 a.m. New York time, on or
before the third business day following the Closing Date or at such other time
as shall be agreed upon by the Underwriter and the Company. The Preferred Stock
and Warrants shall be registered in such name or names and in such authorized
denominations as the Underwriter may request in writing at lease two (2) full
business days prior to the Closing Date. The Company will permit the Underwriter
to examine and package any certificates representing the Preferred Stock and
Warrants for delivery, at least one (1) full business day prior to the Closing
Date.
Delivery to the Representative of and payment for any Additional Units
to be purchased by the Representative shall be made through the facilities of
the DTC, for the account of the Representative, against payment of the purchase
price therefor by wire transfer of Federal (sameday) funds to the account
specified by the Company to the Representative (the "Option Closing Date"),
which may be the same as the Initial Closing, Date but shall in no event be
earlier than the Initial Closing Date nor earlier than two nor later than ten
business days after the giving of the notice hereinafter referred to, as shall
be specified in a written notice from the Representative to the Company of the
Representative's determination to purchase a number, specified in such notice,
of Additional Units. The place of closing for any Additional Units and the
Option Closing Date for such Securities may be varied by agreement among you and
the Company.
On the Initial Closing Date, the Company shall issue and sell to the
Representative the Representative's Warrant for $160.00 (the "Initial Purchase
Price"), which warrant shall entitle the holders thereof to purchase an
aggregate of 160,000 Warrant Shares at a price of $7.50 per share and 160,000
Warrant Warrants at a price of $0._______ per warrant. Payment of the Initial
Purchase Price shall be made on the Initial Closing Date.
The Warrant Securities shall be non-transferable for a period of one
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year from the Initial Closing Date (except to affiliates of the Representative
or an Underwriter). The Representative's Warrants shall be exercisable for a
period of four (4) years commencing one (1) year from the effective date of the
Registration Statement. The form and terms of the Representative's Warrant
Certificate shall be substantially in the form filed as an Exhibit to the
Registration Statement.
5. AGREEMENTS OF THE COMPANY. The Company agrees with the several
Underwriters as. follows:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or a post-effective amendment thereto
to be declared effective before the offering of the Securities may commence, the
Company will endeavor to cause the Registration Statement or such post-effective
amendment to become effective as soon as possible and will advise you promptly
and, if requested by you, will confirm such advice in writing, when the
Registration Statement or such post-effective amendment has become effective.
(b) The Company will advise you promptly and, if requested by you. will
confirm such advice in writing: (i) of any request by the Commission for
amendment of or a supplement to the Registration Statement, any Prepricing
Prospectus or the Prospectus or for additional information; (ii) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the suspension of qualification of the Securities
for offering or sale in any jurisdiction or the initiation of any proceeding for
such purpose; and (iii) within the period of time referred to in paragraph 5(f)
below, of any change in the Company's condition (financial or other), business,
prospects, properties, net worth or results of operations, or of the happening
of any event, which makes any statement of a material fact made in the
Registration Statement or the Prospectus (as then amended or supplemented)
untrue or which requires the making of any additions to or changes in the
Registration Statement or the Prospectus (as then amended or supplemented) in
order to state a material fact required by the Act or the regulations thereunder
to be stated therein or necessary in order to make the statements therein not
misleading, or of the necessity to amend or supplement the Prospectus (as then
amended or supplemented) to comply with the Act or any other law. If at any time
the Commission shall issue any stop order suspending the effectiveness of the
Registration Statement, the Company will make every reasonable effort to obtain
the withdrawal of such order at the earliest possible time.
(c) The Company will furnish to you, without charge (i) two signed
copies of the registration statement as originally filed with the Commission and
of each amendment thereto, including financial statements and all exhibits to
the registration statement and (ii) such number of conformed copies of the
registration statement as originally, filed and of each amendment thereto, but
without exhibits, as you may reasonably request.
(d) The Company will not file any amendment to the Registration
Statement or make any amendment or supplement to the Prospectus, of which you
shall not previously have been advised or to which, after you shall have
received a copy of the document proposed to be filed, you shall reasonably
object in writing.
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(e) Prior to the execution and delivery of this Agreement, the Company
has delivered to you, without charge, in such quantities as you have requested,
copies of each form of the Prepricing Prospectus. The Company consents to the
use, in accordance with the provisions of the Act and with the securities or
Blue Sky laws of the jurisdictions in which the Offering Securities are offered
by the several Underwriters and by dealers, prior to the date of the Prospectus,
of each Prepricing Prospectus so furnished by the Company.
(f) As soon after the execution and delivery of this Agreement as
possible and thereafter from time to time for such period as in the opinion of
counsel for the Underwriters a prospectus is required by the Act to be delivered
in connection with sales by any Underwriter or dealer, the Company will
expeditiously deliver to each Underwriter and each dealer, without charge, as
many copies of the Prospectus (and of any amendment or supplement thereto) as
you may request. The Company consents to the use of the Prospectus (and of any
amendment or supplement thereto) in accordance with the provisions of the Act
and with the securities or Blue Sky laws of the jurisdictions in which the
Shares are offered by the several Underwriters and by all dealers to whom shares
may be sold, both in connection with the offering and sale of the Shares and for
such period of time thereafter as the Prospectus is required by the Act to be
delivered in connection with sales by any Underwriter or dealer. If during such
period of time any event shall occur that in the judgment of the Company or in
the opinion of counsel for the Underwriters is required to be set forth in the
Prospectus (as then amended or supplemented) or should be set forth therein in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary to supplement or
amend the Prospectus in order to comply with the Act or any other law, the
Company will forthwith prepare and, subject to the provisions of paragraph 5(d)
above, file with the Commission an appropriate supplement or amendment thereto
(or to such document), and will expeditiously furnish to the Underwriters and
dealers a reasonable number of copies thereof. In the event that the Company and
you. as Representative of the several Underwriters, agree that the Prospectus
should be amended or supplemented, the Company, if requested by you, will
promptly issue a press release announcing or disclosing the matters to be
covered by the proposed amendment or supplement.
(g) The Company will, concurrently with the Effective Date, register
the class of equity securities under Section 12(g) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act") and the Company will maintain such
registration for a minimum of five (5) years from the Effective Date.
(h) The Company will cooperate with you and with counsel for the
Underwriters in connection with the registration or qualification of the
Securities for offering and sale by the several Underwriters and by dealers
under the securities or Blue Sky laws of such jurisdictions as you may designate
and will file such consents to service of process or other documents necessary
or appropriate in order to effect such registration or qualification; provided
that in no event shall the Company be obligated to qualify to do business in any
jurisdiction where it is not now so qualified or to take any action which would
subject it to service of process in suits, other than those arising out of the
offering or sale of the Securities, in any jurisdiction where it is not now so
subject.
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(i) The Company will make generally available to its security holders a
consolidated earnings statement, which need not be audited, covering a
twelve-month period commencing after the effective date of the Registration
Statement and ending not later than 15 months thereafter, as soon as practicable
after the end of such period, which consolidated earnings statement shall
satisfy the provisions of Section 11(a) of the Act.
(j) For a period of five years from the Effective Date, the Company, at
its expense, will annually furnish to its shareholders a report of its
operations to include financial statements audited by independent public
accountants, and will furnish to the Underwriter as soon as practicable after
the end of each fiscal year, a balance sheet of the Company as at the end of
such fiscal year, together with statements of operations, shareholders' equity,
and changes in cash flow of the Company for such fiscal year, all in reasonable
detail and accompanied by a copy of the certificate or report thereon of'
independent public accountants.
(k) For a period of five years from the Effective Date, the Company
will deliver to the Representative and to Representative's Counsel on a timely
basis (i) a copy of each report or document, including, without limitation,
reports on Forms 8-K, 10-KSB (or 10-K), 10-QSB (or 10-Q) and exhibits thereto,
filed or furnished to the Commission, any securities exchange or the National
Association of Securities Dealers, Inc. (the "NASD"); (ii) as soon as
practicable, copies of any reports or communications (financial or other) of the
Company mailed to its security holders; (iii) as soon as practicable, a copy of
any Schedule 13D, 13G, 14D-1 or 13E-3 received or prepared by the Company from
time to time; and (iv) such additional information concerning the business and
financial condition of Company as the Representative may from time to time
reasonably request and which can be prepared or obtained by the Company without
unreasonable effort or expense. The Company will furnish to its shareholders
annual reports containing audited financial statements and such other periodic
reports as it may determine to be appropriate or as may be required by law.
(1) If this Agreement shall. terminate or shall be terminated after
execution pursuant to any provisions hereof (otherwise than pursuant to the
second paragraph of Section 10 hereof or by notice given by you terminating this
Agreement pursuant to Section 10 or Section 11 hereof) or if this Agreement
shall be terminated by the Underwriters because of any failure or refusal on the
part of the Company to comply with the terms or fulfill any of the conditions of
this Agreement, the Company agrees to reimburse the Representative for all
out-of-pocket expenses (including fees and expenses of counsel for the
Underwriters) incurred by you in connection herewith.
(m) The Company will apply the net proceeds from the sale of the
Offering Securities to be sold by it hereunder substantially in accordance with
the description set forth in the Prospectus.
(n) If Rule 430A of the Act is employed, the Company will timely file
the Prospectus pursuant to Rule 424(b) under the Act and will advise you of the
time and manner of such filing.
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(o) Except as provided in this Agreement, the Company will not sell,
contract to sell or otherwise dispose of any Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock, or grant any
options or warrants to purchase Common Stock, for a period of two years after
the date of the Prospectus, without the prior written consent of Werbel-Roth
Securities, Inc.; provided, however, that the Company may issue Common Stock
pursuant to the terms of any warrants, options or stock option plans existing on
the date hereof.
(p) The Company has furnished or will furnish to you "LOCK-UP" letters,
in form and substance satisfactory to you, signed by each of its current
stockholders.
(q) Except as stated in this Agreement and in the Prepricing Prospectus
and Prospectus, the Company has not taken, nor will it take, directly or
Indirectly, any action designed to stabilize or manipulate, or that might
reasonably be expected to cause or result in stabilization or manipulation of,
the price of the Common Stock to facilitate the sale or resale of the
Securities.
(r) The Company will use its best efforts to have the shares of
Preferred Stock which it agrees to sell under this Agreement listed, subject to
notice of issuance. in Standard & Poor's and (2) on the Nasdaq SmallCap Market
on or before the Initial Closing Date and to maintain such listing for at least
five years from the Initial Closing Date.
(s) So long as any Warrants are outstanding, the Company shall use its
best efforts to cause post-effective amendments to the Registration Statement to
become effective in compliance with the Act as shall be necessary to enable the
sale of the Class A Common Stock underlying the Warrants and cause a copy of
each Prospectus, as then amended, to be delivered to each holder of record of a
Warrant as they may request and as otherwise required by law and, to furnish to
the Representative and dealers as many copies of each such Prospectus as the
Representative or dealer may reasonably request. In addition, for so long as any
Warrant is outstanding, the Company will promptly notify the Representative of
any material change in the financial condition, business, results of operations
or properties of the Company.
(t) Neither the Company nor any person that is controlled by the
Company will take any action designed to stabilize or manipulate, or which might
be reasonably expected to cause or result in the stabilization or manipulation
of, the price of the Preferred Stock, Common Stock or Warrants.
(u) The Company shall retain a transfer agent for the Preferred Stock,
Common Stock and Warrants, reasonably acceptable to the Representative, for a
period of five (5) years from the Effective Date. In addition, for a period of
five (5) years from the Effective Date, the Company, at its own expense, shall
cause such transfer agent to provide the Representative with copies of the
Company's daily transfer sheets, and, no less frequently that weekly, a current
list of the Company's security holders, including a list of the beneficial
owners of' securities held by a depository trust company and other nominees.
(v) The Representative and its successors will have the right to
designate a nominee for election, at its or their option, either as a member of
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or a non-voting advisor to the Board of Directors of the Company, and the
Company will use its best efforts to cause such nominee to be elected and
continued in office as a director of the Company or as such advisor until the
expiration of five (5) years from the Effective Date. Each of the Company's
current officers, directors and shareholders agrees to vote all of the Common
Stock owned by such person or entity so as to elect and continue in office such
nominee of' the Representative. Following the election of such nominee as a
director or advisor, such person shall receive no more or less compensation than
is paid to other non-officer directors of the Company for attendance at meetings
of the Board of Directors of the Company and shall be entitled to receive
reimbursement for all reasonable costs incurred in attending such meetings
including, but not limited to, food, lodging and transportation. The Company
agrees to indemnify and hold such director or advisor harmless, to the maximum
extent permitted by law, against any and all claims, actions, awards and
judgments arising out of his service as a director or advisor and, in the event
the Company maintains a liability insurance policy affording coverage for the
acts of its officers and directors, to include such director or advisor as an
insured under such policy. The rights and benefits of such indemnification and
the benefits of such insurance shall, to the extent possible, extend to the
Representative insofar as it may be or may be alleged to be responsible for such
director or advisor. If the Representative does not exercise its option to
designate a member of or advisor to the Company's Board of Directors, the!
Representative shall nonetheless have the right to send a representative (who
need not be the same individual from meeting to meeting) to observe each meeting
of the Board of Directors. The Company agrees to give the Representative notice
of each such meeting and to provide the Representative with an agenda and
minutes of the meeting no later than it gives such notice and provides such
items to the directors.
(w) For a period of five (5) years from the Effective Date, or until
such earlier time as the Preferred Stock and Warrants are listed on the New York
Stock Exchange or the American Stock Exchange, the Company shall cause its legal
counsel to provide the Representative with a list, to be updated at least
annually, of those states in which the Preferred Stock and Warrants may be
traded in non-issuer transactions under the Blue Sky laws of the 50 states.
(x) For a period of. five (5) years from the Effective Date, the
Company shall continue to retain Spear, Safer, Harmon & Co., P.A., (or such
other accounting firm as is acceptable to the Representative) as the Company's
independent public accountants.
6. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to each Underwriter that:
(a) Each Prepricing Prospectus included as part of the registration
statement as originally filed or as part of any amendment or supplement thereto,
or filed pursuant to Rule 424 under the Act, complied when so filed in all
material respects with. the provisions of the Act. The Commission has not issued
any order preventing or suspending the use of any Prepricing Prospectus.
(b) The Company and the transactions contemplated by this Agreement
meet the requirements for using Form SB-2 under the Act. The registration
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statement in the form in which it became or becomes effective and also in such
form as it may be when any post-effective amendment thereto shall become
effective and the prospectus and any supplement or amendment thereto when filed
with the Commission under Rule 424(b) under the Act, complied or will comply in
all material respects with the provisions of the Act and will not at any such
times 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, except that this representation and warranty does not apply to
statements in or omissions from the registration statement or the prospectus
made in reliance upon and in conformity with information relating to any
Underwriter furnished to the Company in writing by or on behalf of any
Underwriter through you expressly for use therein.
(c) All the outstanding shares of Preferred Stock and Common Stock of
the Company have been duly authorized and validly issued, are fully paid and
nonassessable and are free of any preemptive or similar rights; the Securities
to be issued and sold by the Company, any have been duly authorized and, when
issued and delivered to the Underwriters against payment therefor, or to the
holders of Warrants upon exercise thereof, in accordance with the terms hereof
or the terms of the Warrants, as the case may be, will be validly issued, fully
paid and nonassessable and free of any preemptive or similar rights; and the
capital stock of the Company conforms to the description thereof in the
registration statement and the prospectus.
(d) The Company is a corporation duly organized and validly existing in
good standing under the laws of the State of Florida with full corporate power
and authority to own, lease and operate its properties and to conduct its
business as described in the Registration Statement and the Prospectus, and is
duly registered and qualified to conduct its business and is in good standing in
each jurisdiction or place where the nature of its properties or the conduct of
its business requires such registration or qualification, except where the:
failure so to register or qualify does not have a material adverse effect on the
condition (financial or other), business, properties, net worth or results of
operations of the Company and the Subsidiaries (as hereinafter defined) taken as
a whole.
(e) The Company's subsidiaries (collectively, the "SUBSIDIARIES") are
listed on Exhibit A hereto. Each Subsidiary is a corporation duly organized,
validly existing and in good standing in the jurisdiction ' of its
incorporation, with full corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the Registration
Statement and the Prospectus, and is duly registered and qualified to conduct
its business and is in good standing in each jurisdiction or place where the
nature of its properties or the conduct of its business requires such
registration or qualification, except where the failure so to register or
qualify does not have a material adverse effect on the condition (financial or
other), business, properties, net worth or results of operations of such
Subsidiary; all the outstanding shares of capital stock of each of the
Subsidiaries have been duly authorized and validly issued, are fully paid and
nonassessable and, except as disclosed in the Prospectus, are owned by the
Company directly, or indirectly through one of the other Subsidiaries, free and
clear of any lien, adverse claim, security interest, equity or other
encumbrance.
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(f) There are no legal or governmental proceeding pending or, to the
knowledge of the Company, threatened, against the Company or any of the
Subsidiaries, or to which the Company or any of the Subsidiaries, or to which
any of their respective properties is subject, that are required to be described
in the Registration Statement or the Prospectus but are not described as
required, and there are no agreements, contracts, indentures, leases or other
instruments that are required to be described in the Registration Statement or
the Prospectus or to be filed as an exhibit to the Registration Statement that
are not described or filed as required by the Act or the Exchange Act.
(g) Neither the Company nor any of the Subsidiaries is in violation of
its certificate or articles of incorporation or by-laws, or other or
organizational documents, or of any law, ordinance, administrative or
governmental rule or regulation applicable to the Company or any of the
Subsidiaries or of any decree of any court or governmental agency or body having
jurisdiction over the Company or any of the Subsidiaries, or in default ill any
material respect in the performance of any obligation, agreement or condition
contained in any bond, debenture, note or any other evidence of indebtedness or
in any material agreement. indenture, lease or other instrument to which the
Company or any of the Subsidiaries is a party or by which any of them or any of
their respective properties may be bound.
(h) Neither the issuance and sale of the Securities, the execution,
delivery or performance of this Agreement by the Company nor the consummation by
the Company of the transactions contemplated hereby (i) requires any consent,
approval, authorization or other order of or registration or filing with, any
court, regulatory body, administrative agency or other governmental body, agency
or official (except such as may be required for the registration of the
Securities under the Act and the Exchange Act and compliance with the securities
or Blue Sky laws of various jurisdictions, all of which have been or will be
effected in accordance with this Agreement) or conflicts or will conflict with
or constitutes or will constitute a breach of, or a default under, the
certificate or articles of incorporation or bylaws, or other organizational
documents, of the Company or any of the Subsidiaries or (ii) conflicts or will
conflict with or constitutes or will constitute a breach of, or a default under,
any agreement, indenture, lease or other instrument to which the Company or any
of the Subsidiaries is a party or by which any of them or any of their
respective properties may be bound, or violates or will violate any statute,
law, regulation or filing or judgment, injunction, order or decree applicable to
the Company or any of the Subsidiaries or any of their respective properties, or
will result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any of the Subsidiaries pursuant
to the terms of any agreement or instrument to which any of them is a party or
by which any of them may be bound or to which any of the property or assets of
any of them is subject.
(i) The accountants, who have certified or shall certify the financial
statements included or incorporated by reference in the Registration Statement
and the Prospectus (or any amendment or supplement thereto) are independent
public accountants as required by the Act.
(j) The financial statements, together with related schedules and notes
included or incorporated by reference in the Registration Statement and the
Prospectus (and any amendment or supplement thereto), present fairly the
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consolidated financial position, results of operations and changes in financial
position of the Company and the Subsidiaries on the basis stated in the
Registration Statement at the respective dates or for the respective periods to
which they apply; such statements and related schedules and notes have been
prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except as disclosed
therein and, in the case of unaudited financial statements, the absence of notes
thereto and statements of cash flows and subject to normal recurring
adjustments; and the other financial and statistical information and data
included or incorporated by reference in the Registration Statement and the
Prospectus (and any amendment or supplement thereto) are accurately presented
and prepared on a basis consistent with such financial statements and the books
and records of the Company and the Subsidiaries.
(k) The execution and delivery of, and the performance by the Company
of its obligations under, this Agreement have been duly and validly authorized
by the Company, and this Agreement has been duly executed and delivered by the
Company, and constitutes the valid and legally binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as rights
to indemnity and contribution hereunder may be limited by federal or state
securities laws.
(1) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus (or any amendment or supplement thereto), neither
the Company nor any of the Subsidiaries has incurred any liability or
obligation, direct or contingent, or entered into any transaction, not in the
ordinary course of business, that is material to the Company and the
Subsidiaries taken as a. whole, and there has not been any change in the capital
stock, or material increase in the short-term debt or long-term debt, of the
Company or any of the Subsidiaries, or any material adverse change, or any
development involving or which may reasonably be expected to involve, a
prospective material adverse change, in the condition (financial or other),
business, net worth or results of operations of the Company and the Subsidiaries
taken as a whole.
(m) Each of the Company and the Subsidiaries has good and marketable
title to all property (real and personal) described in the Prospectus as being
owned by it, free and clear of all liens, claims, security interests or other
encumbrances except such as are described in the Registration Statement and the
Prospectus or in a document filed as an exhibit to the Registration Statement or
such imperfections or liens which do not materially interfere with the Company's
use thereof, and all the property described in the Prospectus as being held
under lease by each of the Company and the Subsidiaries is held by it under
valid, subsisting and enforceable leases.
(n) The Company has not distributed and, prior to the later to occur of
(i) the Initial Closing Date and (ii) completion of the distribution of the
Offering Securities, will not distribute any offering material in connection
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<PAGE> 12
with the offering and sale of the Offering Securities other than the
Registration Statement, the Prepricing Prospectus, the: Prospectus or other
materials, if any, permitted by the Act.
(o) The Company and each of the Subsidiaries has such material permits,
licenses, franchises and authorizations of governmental or regulatory
authorities ("permits") as are necessary to own its respective properties and to
conduct its business in the manner described in the Prospectus, subject to such
qualifications as may be set forth in the Prospectus, the Company and each of
the Subsidiaries has fulfilled and performed all its material obligations with
respect to such permits and no event has occurred which allows, or after notice
or lapse of time would allow, revocation or termination thereof or results in
any other material impairment of the rights of the holder of any such permit.
subject in each case to such qualification as may be set forth in the
Prospectus; and, except as described in the Prospectus, none of such permits
contains any restriction that is materially burdensome to the Company or any of
the Subsidiaries.
(p) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are recorded
as necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain accountability for
assets; (ii) access to assets is permitted on] in accordance with management's
general or specific authorization; and (iii) the recorded accountability for
assets is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(q) To the Company's knowledge, neither the Company nor any of its
Subsidiaries nor any employee or agent of the Company or any Subsidiary has made
any payment of funds of the Company or any Subsidiary or received or retained
any funds in violation of any law, rule or regulation, which payment, receipt or
retention of funds is of a character required to be disclosed in the Prospectus.
(r) The Company and each of the Subsidiaries have filed all tax returns
required to be filed, which returns are correct in all material respects, and
neither the Company nor any Subsidiary is in default in the payment of any taxes
which were payable pursuant to said returns or any assessments with respect
thereto.
(s) Except as set forth in the Prospectus, the Company has no employee
benefit plans (including, without limitation, profit sharing and welfare benefit
plans) or deferred compensation arrangements that are subject to the provisions
of the Employee Retirement Income Security Act of 1974.
(t) No holder of any security of the Company has any right to require
registration of shares of Common Stock or any other security of the Company
because of the filing of the registration statement or consummation of the
transactions contemplated by this Agreement.
(u) The Company and the Subsidiaries own or possess all patents,
trademarks. trademark registrations, service marks, service mark registrations,
trade names, copyrights, licenses, inventions, trade secrets and rights
described in the Prospectus as being owned by them or any of them or necessary
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<PAGE> 13
for the conduct of their respective businesses, and the Company is not aware of
any claim to the contrary or any challenge by any other person to the rights of
the Company and the Subsidiaries with respect to the foregoing.
(v) The Company has complied with all provisions of Florida Statutes,
ss. 517.075, relating to issuers doing business with Cuba.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless each of you and
each other Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the Act or Section 20(a) of the Exchange Act
from. and against any and all losses, claims, damages, liabilities and expenses
(including reasonable costs of investigation) arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in any
Prepricing Prospectus or in the Registration Statement or the Prospectus or in
any amendment or supplement thereto, or arising out of or based upon any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or expenses arise
out of or are based upon any untrue statement or omission or alleged untrue
statement or omission which has been made therein or omitted therefrom in
reliance upon and in conformity with the information relating to such
Underwriter furnished in writing to the Company by or on behalf of any
Underwriter through you expressly for use in connection therewith; provided,
however, that the indemnification contained in this, paragraph 7(a) with respect
to any Prepricing Prospectus shall not inure to the benefit of any Underwriter
(or to the benefit of any person controlling such Underwriter) on account of any
such, loss, claim, damage, liability or expense arising from the sale of the
Securities by such Underwriter to any person if a copy of the Prospectus shall
not have been delivered or sent to such person within the time required by the
Act and the regulations thereunder, and the untrue statement or alleged untrue
statement or omission or alleged omission of a material fact contained in such
Prepricing Prospectus was corrected in the Prospectus, provided that the Company
has delivered the Prospectus to the several Underwriters in requisite quantity
on a timely basis to permit such delivery or sending. The foregoing indemnity
agreement shall be in addition to any liability which the Company may otherwise
have.
(b) If any action, suit or proceeding shall be brought against any
Underwriter or any person controlling any Underwriter in respect of which
indemnity may be sought against the Company, such Underwriter or such
controlling person shall promptly notify the parties against whom
indemnification is being sought (the "INDEMNIFYING PARTIES"), and such
indemnifying parties shall assume the defense thereof, including the employment
of counsel and payment of all fees and expenses. Such Underwriter or any such
controlling person shall have the right to employ separate counsel in an such
action, suit or proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such Underwriter or
such controlling person unless (i) the indemnifying parties have agreed in
writing to pay such fees and expenses, (ii) the indemnifying parties have failed
to assume the defense and employ counsel, or (iii) the named parties to any such
action, suit or proceeding (including any impleaded parties) include both such
Underwriter or such controlling person and the indemnifying parties and such
Underwriter or such controlling person shall have been advised by its counsel in
writing that representation of such indemnified party and any indemnifying party
by the same counsel would be inappropriate under applicable standards of
professional conduct (whether or not such representation by the same counsel has
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<PAGE> 14
been proposed) due to actual or potential differing interests between them (in
which case the indemnifying party shall not have the right to assume the defense
of such action, suit or proceeding on behalf of such Underwriter or such
controlling person). It is understood, however, that the indemnifying parties
shall, in connection with any one such action, suit or proceeding or separate
but substantially similar or related actions, suits or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of only one separate firm of
attorneys (in addition to any local counsel) at any time for all such
Underwriters and controlling persons not having actual or potential differing
interests with you or among themselves, which firm shall be designated in
writing by Werbel-Roth Securities, Inc., and shall be reasonably acceptable to
the Company, and that all such fees and expenses shall be reimbursed as they are
incurred. The indemnifying parties shall not be liable for any settlement of any
such action, suit or proceeding effected without their written consent, but if
settled with such written consent, or if there be a final judgment for the
plaintiff in arin, such action, suit or proceeding, the indemnifying parties
agree to indemnify and hold harmless any Underwriter, to the extent provided in
the preceding paragraph, and any such controlling person from and against any
loss, claim, damage, liability or expense by reason of such settlement or
judgment.
(c) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement, and any person who controls the Company within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange Act, to the
same extent as the foregoing indemnity from the Company to each Underwriter, but
only with respect to information relating to such Underwriter furnished in
writing by or on behalf of such Underwriter through you expressly for use in the
Registration Statement, the Prospectus or any Prepricing Prospectus, or any
amendment or supplement thereto, or failure to comply with applicable law as it
relates to this agreement. If any action, suit or proceeding shall be brought
against the Company, any of its directors, any such officer, or any such
controlling person based on the Registration Statement, the! Prospectus or any
Prepricing Prospectus, or any amendment or supplement thereto, and in respect of
which indemnity may be sought against any Underwriter pursuant to this paragraph
7(c), such Underwriter shall have the rights and duties given to the Company by
paragraph 7(b) above (except that if the Company shall have assumed the defense
thereof such Underwriter shall not be required to do so, but may employ separate
counsel therein and participate in the defense thereof, but the fees and
expenses of such counsel shall be at such Undenvi-iter's expense), and the
Company, its directors, any such officer, and any such controlling person shall
have the rights and duties given to the Underwriters by paragraph 7(b) above.
The foregoing indemnity agreement shall be in addition to any liability which
any Underwriter may otherwise have,
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under paragraphs 7(a) or 7(c) hereof in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then an indemnifying party, in lieu of indemnifying such indemnified
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<PAGE> 15
party, shall contribute to the amount pa id or payable by such indemnified party
as a result of such losses, claims, damages, liabilities or expenses (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the offering
of the Securities, or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions that resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Underwriters shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) received by the Company
bear to the total underwriting discounts and commissions received bv the
Underwriters, in each case as set forth in the table on the cover page of the
Prospectus, provided that, in the event that the Representative shall have
purchased any Additional Shares hereunder, any determination of the relative
benefits received by the Company, or the Underwriters from the offering of the
Securities shall include the net proceeds (before deducting expenses) received
by the Company, and the underwriting discounts and commissions received by the
Representative, from the sale of such Additional Securities, in each case
computed on the basis of the respective amounts set forth in the notes to the
table on the cover page of the Prospectus. The relative fault of the Company and
the Underwriters shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(e) The Company and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 7 were determined by a
pro-rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in Section 7(d) above. The amount paid
or payable by an indemnified party as a result of the losses, claims, damages,
liabilities and expenses referred to in paragraph 7(d) above shall be deemed to
include, subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
any claim or defending any such action, suit or proceeding. Notwithstanding the
provisions of this Section 7, no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price of the Offering
Securities underwritten by it and distributed to the public exceeds the amount
of any damages which such Underwriter has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning,
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations to contribute pursuant to this Section 7 are several in proportion
to the respective numbers of Firm Shares set forth opposite their names in
Schedule I hereto (or such numbers of Firm Shares increased as set forth in
Section 10 hereof) and not joint.
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<PAGE> 16
(f) No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
action, suit or proceeding in respect of which any indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement involves no monetary payment by the
indemnified party and includes an unconditional release of such indemnified
party from all liability or claims that are the subject matter of such action,
suit or proceeding.
(g) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section 7 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages. liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 7 and the
representations and warranties of the Company set forth in this Agreement shall
remain operative and in full force and effect, regardless of (i) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter, the Company, its directors or officers or any person
controlling the Company, (ii) acceptance of any Securities and payment therefor
hereunder, and (iii) any termination of this Agreement. A successor to any
Underwriter or any person controlling any Underwriter, or to the Company, its
directors or officers, or any person controlling the Company, shall be entitled
to the benefits of the indemnity, contribution and reimbursement agreements
contained in this Section 7.
8. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several obligations of
the Underwriters to purchase the Offering Securities hereunder are subject to
the following conditions:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the registration statement or a post-effective amendment thereto
to be declared effective before the offering of the Offering Securities may
commence, the registration statement or such post-effective amendment shall have
become effective not later than 5:30 P.M., Eastern time, on the date hereof, or
at such later date and time as shall be consented to in writing by you, and all
filings, if any, required by Rules 424 and 430A under the Act shall have been
timely made; no stop order suspending the effectiveness of the registration
statement shall have been issued and no proceeding for that purpose shall have
been instituted or, to the knowledge of the Company or any Underwriter,
threatened by the Commission, and any request of the Commission for additional
information (to be included in the registration statement or the prospectus or
otherwise) shall have been complied with to your satisfaction.
(b) Subsequent to the effective date of this Agreement. there shall not
have occurred (i) any change, or any development involving a prospective chance,
in or affecting the condition (financial or other), business, properties, net
worth, or results of operations of the Company or the Subsidiaries not
contemplated by the Prospectus, which in your opinion, as Representative of the
several Underwriters, would materially adversely affect the market for the
Offering Securities, or (ii) any event or development relating to or involving
the Company or any officer or director of the Company which makes any statement
made in the Prospectus untrue or which, in the opinion of the Company and its
counsel or the Underwriters and their counsel, requires the making of any
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<PAGE> 17
addition to or change in the Prospectus in order to state a material fact
required by the Act or any other law to be stated therein or necessary in order
to make the statements therein not misleading, if amending or supplementing, the
Prospectus to reflect such event or development would, in your opinion, as
Representative of the several Underwriters, materially adversely affect the
market for the Offering Securities.
(c) You shall have received on the Initial Closing Date, an opinion of
Atlas Pearlman, P.A., counsel for the Company, dated the Initial Closing Date
and addressed to you, as Representative of the several Underwriters, to the
effect that:
(i) The Company is a corporation duly incorporated and validly
existing in good standing under the laws of the State of Florida with full
corporate power and authority to own, lease and operate its properties and to
conduct its business as described in the Registration Statement and the
Prospectus (and any amendment or supplement thereto), and is duly registered and
qualified to conduct its business and is in good standing, in each jurisdiction
or place where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure so to
register or qualify does not have a material adverse effect on the condition
(financial or other), business, properties, net worth or results of operations
of the Company and the Subsidiaries taken as a whole;
(ii) Each of the Subsidiaries is a corporation duly organized
and validly existing in good standing under the laws of the jurisdiction of its
organization, with full corporate power and authority to own, lease, and operate
its properties and to conduct its business as described in the Registration
Statement and the Prospectus (and any amendment or supplement thereto); and all
the outstanding shares of capital stock of each of the Subsidiaries have been
duly authorized and validly issued, are fully paid and nonassessable and, except
as disclosed in the Prospectus, are owned by the Company directly, or indirectly
through one of the other Subsidiaries, free and clear of any perfected security
interest, or, to the best knowledge of such counsel after reasonable inquiry,
any other security interest, lien, adverse claim, equity or other encumbrance;
(iii) To the best knowledge of such counsel after reasonable
inquiry, the authorized and outstanding capital stock of the Company is as set
forth under the caption "Capitalization" in the Prospectus; and the authorized
capital stock of the Company conforms in all material respects as to legal
matters to the description thereof contained in the Prospectus under the caption
"Description of Capital Stock";
(iv) The Offering Securities and the Warrant Securities have
been duly authorized and, when issued and delivered to the Underwriters against
payment therefor in accordance with the terms hereof, will be validly issued,
fully paid and nonassessable and free of any preemptive, or to the best
knowledge of such counsel after reasonable inquiry, similar rights that entitle
or will entitle any person to acquire any Shares upon the issuance thereof by
the Company;
(v) The certificates representing the Securities are in due
and proper form and the Preferred Stock and Class A Common Stock issuable upon
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<PAGE> 18
the exercise of the Firm Warrants, the Additional Warrants, the Representative's
Warrant and the Warrant Warrants has been duly authorized and reserved for
issuance, and when issued and delivered in accordance with the terms of such
warrants will be duly and validly issued, fully paid and nonassessable.
(vi) The Registration Statement and all post-effective
amendments, if any, have become effective under the Act and, to the best
knowledge of such counsel after reasonable inquiry, no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
for that purpose are pending before the Commission; and any required filing of
the Prospectus pursuant to Rule 424(b) has been made in accordance with Rule
424(b);
(vii) The Company has corporate power and authority to enter
into this Agreement and to issue, sell and deliver the Securities to be sold by
it to the Underwriters as provided herein, and this Agreement has been duly
authorized. executed and delivered by the Company and is a valid, legal and
binding agreement of the Company, enforceable against-the Company in accordance
with its terms, except as enforcement of rights to indemnity and contribution
hereunder may be limited by Federal or state securities laws or principles of
public policy and subject to the qualification that the enforceability of the
Company's obligations may be limited by bankruptcy, fraudulent conveyance and
similar laws affecting creditors' rights generally and by general equitable
principals;
(viii) Neither the Company nor any of the Subsidiaries is in
violation of its respective certificate or articles of incorporation or bylaws,
or other organizational documents, or to the best knowledge of such counsel
after reasonable inquiry, is in default in the performance of any material
obligation, agreement or condition contained in any bond, debenture, note or
other evidence of indebtedness required to be described in the Prospectus,
except as may be disclosed in the Prospectus;
(ix) Neither the offer, sale or delivery of the Securities,
the execution, delivery or performance of this Agreement, compliance by the
Company with the provisions hereof nor consummation by the Company of the
transactions contemplated hereby conflicts or will conflict with or constitutes
or will constitute a breach of, or a default under, the certificate or articles
of incorporation or bylaws, or other organizational document of the Company or
any of the Subsidiaries or any agreement, indenture, lease or other instrument
to which the Company or any of the Subsidiaries is a party or by which any of
them or any of their respective properties is bound that is an exhibit to the
Registration Statement, or is known to such counsel after reasonable inquiry, or
will result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any of the Subsidiaries, nor will
any such action result in any violation of any existing law, regulation, ruling
(assuming compliance with all applicable state securities and Blue Sky laws),
judgment. injunction, order or decree known to such counsel after reasonable
inquiry, applicable to the Company, the Subsidiaries or any of their respective
properties;
(x) No consent, approval, authorization or other order of, or
registration or filing with, any court, regulatory body, administrative agency
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<PAGE> 19
<PAGE> 20
or other governmental body, agency, or official is required on the part of the
Company (except as have been obtained under the Act and the Exchange Act or such
as may be required under state securities or Blue Sky laws governing the
purchase and distribution of the Shares) for the valid issuance and sale of the
Shares to the Underwriters as contemplated by this Agreement; the Registration
Statement and the Prospectus and any supplements or amendments thereto (except
for the financial statements and the notes thereto and the schedules and other
financial and statistical data included therein, as to which such counsel need
not express any opinion) comply as to form in all material respects with the
requirements of the Act;
(xii) To the best knowledge of such counsel after reasonable
inquiry: (A) other than as described or contemplated in the Prospectus (or any
supplement thereto), there are no legal or governmental proceedings pending or
threatened against the Company or any of the Subsidiaries, or to which the
Company or any of the Subsidiaries, or any of their property, is subject, which
are required to be described in the Registration Statement or Prospectus (or any
amendment or supplement thereto) and (B) there are no agreements, contracts,
indentures, leases or other instruments, that are required to be described in
the Registration Statement or the Prospectus (or any amendment or supplement
thereto) or to be filed as an exhibit to the Registration Statement that are not
described or filed as required, as the case may be;
(xiii) To the best knowledge of such counsel after reasonable
inquiry, neither the Company nor any of the Subsidiaries is in violation of any
law, ordinance, administrative or governmental rule or regulation applicable to
the Company or any of the Subsidiaries or of any decree of any court or
governmental agency or body having jurisdiction over the Company or any of the
Subsidiaries;
(xiv) Upon delivery of the Securities pursuant to this
Agreement and payment therefor as contemplated herein the Underwriters will
acquire good and marketable title to the Securities free and clear of any lien,
claim, security interest, or other encumbrance, restriction on transfer or other
defect in title;
(xv) Although counsel has not undertaken, except as otherwise
indicated in their opinion, to determine independently, and does not assume any
responsibility for, the accuracy or completeness of the statements in the
Registration Statement, such counsel has participated in the preparation of the
Registration Statement and the Prospectus, including review and discussion of
the contents thereof and nothing has come to the attention of such counsel that
has caused them to believe that the Registration Statement at the time the
Registration Statement became effective, or the Prospectus, as of its date and
as of the Initial Closing Date or the Option Closing Date, as the case may be,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
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<PAGE> 21
not misleading in light of the circumstances when made or that any amendment or
supplement to the Prospectus, as of its respective date, and as of the Initial
Closing Date or the Option Closing Date, as the case may be, contained any
untrue statement of a material fact or omitted 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 (it being understood
that such counsel need express no opinion with respect to the financial
statements and the notes thereto and the schedules and other financial and
statistical data included in the Registration Statement or the Prospectus);
(xvi) The Company and each of the Subsidiaries has full
corporate power and authority, and all necessary governmental authorizations,
approvals, orders, licenses, certificates, franchises and permits of and from
all governmental regulators officials and bodies (except where the failure so to
have any such authorizations, approvals, orders, licenses, certificates,
franchises or permits, individually or in the aggregate, would not have a
material adverse effect on the business, properties, operations or financial
condition of the Company and the Subsidiaries taken as a whole), to own their
respective properties and to conduct their respective businesses as now being
conducted, as described in the Prospectus;
(xvii) Except as disclosed in the Prospectus, the Company owns
of record, directly or indirectly, all the outstanding shares of capital stock
of each of the Subsidiaries free and clear of any lien, adverse claim, security
interest, equity, or other encumbrance;
(xviii) The Company and the Subsidiaries own all trademarks,
trademark registrations, service marks, service mark registrations, trade names,
copyrights, licenses, inventions, trade secrets and rights described in the
Prospectus as being owned by them or any of them, and Atlas Pearlman, P.A. is
not aware of any claim to the contrary or any challenge by any other person to
the rights of the Company and the Subsidiaries with respect to the foregoing;
(xix) To the best of knowledge of such counsel after
reasonable inquiry, except as described in the Prospectus, there are no
outstanding options, warrants or other rights calling for the issuance of, and
such counsel does not know of any commitment, plan or arrangement to issue, any
shares of capital stock of the Company or any security convertible into or
exchangeable or exercisable for capital stock of the Company; and
(xx) To the best of knowledge of such counsel after reasonable
inquiry, except as described in the Prospectus, there is no holder of any
security of the Company or any other person who has the right, contractual or
otherwise, to cause the Company to sell or otherwise issue to them, or to permit
them to underwrite the sale of, the Securities or the right to have any Common
Stock or other securities of the Company included in the registration statement
or the right, as a result of the filing of the registration statement, to
requite registration under the Act of any shares of Common Stock or other
securities of the Company.
In rendering their opinion, counsel may rely upon an opinion or
opinions, each dated the Initial Closing Date, of other counsel retained by them
or the Company as to laws of any jurisdiction other than the United States or
the State of Florida, provided that (1) each such local counsel is acceptable to
the Representative, (2) such reliance is expressly authorized by each opinion so
relied upon and a copy of each such opinion is delivered to the Representative
and is, in form and substance satisfactory to them and their counsel, and (3)
counsel shall state in their opinion that they believe that they and the
Underwriters are justified in relying thereon.
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(d) You shall have received on the Initial Closing Date an opinion of
Dreier & Baritz LLP, counsel for the Underwriters, dated the Initial Closing
Date and addressed to you, as Representative of the several Underwriters, with
respect to the matters referred to in clauses 8(c)(iv), 8(c)(vi), 8(c)(vii),
8(c)(xi), 8(c)(xv) and such other related matters as you may request.
(e) You shall have received letters addressed to you, as Representative
of the several Underwriters, and dated the date hereof and the Initial Closing
Date from Spear, Safer, Harmon & Co., P.A., independent certified public
accountants, substantially in the forms heretofore approved by you.
(f) (i) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been taken or, to the knowledge of the Company, shall be contemplated by the
Commission at or prior to the Initial Closing Date; (ii) there shall not have
been any change in the capital stock of the Company nor any material increase in
the short-term or long-term debt of the Company (other than in the ordinary
course of business) from that set forth or contemplated in the Registration
Statement or the Prospectus (or any amendment or Supplement thereto); (iii)
there shall not have been, since the respective dates as of which information is
given in the Registration Statement and the Prospectus (or any amendment or
supplement thereto), except as may otherwise be stated in the Registration
Statement and Prospectus (or any amendment or supplement thereto), any material
Adverse change in the condition (financial or other), business, prospects
properties, net worth or results of operations of the Company and the
Subsidiaries taken as a whole; (iv) the Company and the Subsidiaries shall not
have any liabilities or obligations, direct or contingent (whether or not in the
ordinary course of business), that are material to the Company and the
Subsidiaries, taken as a whole, other than those reflected in the Registration
Statement or the Prospectus (or any amendment or supplement thereto); and (v)
all the representations and warranties of the Company contained in this
Agreement shall be true and correct in all material respects on and as of the
date hereof and on and as of the Initial Closing Date as if made on and as of
the initial Closing Date, and you shall have received a certificate, dated the
Closing Date and signed by the chief executive officer and the chief financial
officer of the Company (or such other officers as are acceptable to you), to the
effect set forth in this Section 8(f) and in Section 8(g) hereof.
(g) The Company shall not have failed at or prior to the Initial
Closing Date to have performed or complied with any of its agreements herein
contained and required to be performed or complied with by it hereunder at or
prior to the Initial Closing Date.
(h) Prior to the Initial Closing Date the shares of Preferred Stock and
the Warrants which the Company agrees to sell pursuant to this Agreement shall
have been listed, subject to notice of issuance, in Standard & Poor's and on the
Nasdaq SmiallCap Market.
(i) The Company shall have furnished or caused to be furnished to you
such further certificates and documents as you shall have reasonably requested.
(j) The NASD shall have indicated that it has no objection to the
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underwriting arrangements pertaining to the sale of the Securities by the
Underwriters.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are satisfactory in form and
substance to you and your counsel.
Any certificate or document signed by any officer of the Company and
delivered to you, as Representative of the Underwriters, or to counsel for the
Underwriters, shall be deemed a representation and warranty by the Company to
each Underwriter as to the statements made therein.
The obligation of the Representative to purchase Additional Securities
hereunder is subject to the satisfaction on and as of any Option Closing Date of
the conditions set forth in this Section 8, except that, if any Option Closing
Date is other than the Initial Closing Date, the certificates, opinions and
letters referred to in paragraphs 8(c) shall be dated the Option Closing Date in
question and the opinions called for by paragraphs 8(c) and 8(d) shall be
revised to reflect the sale of Additional Securities.
9. EXPENSES.
(a) The Company agrees to pay the following costs and expenses and all
other costs and expenses incident to the performance by it of its obligations
hereunder: (i) the preparation, printing or reproduction, and filing with the
Commission of the registration statement (including financial statements and
exhibits thereto), each Prepricing Prospectus, the Prospectus, and each
amendment or supplement to any of them; (ii) the printing (or reproduction) and
delivery (including postage, air freight charges and charges for counting and
packaging) of such copies of the registration statement, each Prepricing
Prospectus, the Prospectus, and all amendments or supplements to any of them, as
may be reasonably requested for use in connection with the offering and sale of
the Offering Securities;; (iii) the preparation, printing, authentication,
issuance and delivery of certificates for the Securities, including any stamp
taxes in connection with the original issuance and sale of the Securities; (iv)
the printing (or reproduction) and delivery of this Agreement, the preliminary
and supplemental Blue Sky Memoranda and all other agreements or documents
printed (or reproduced) and delivered in connection with the offering of the
Securities; (v) the listing of the Preferred Stock and Warrants in Standard &
Poor's and on the Nasdaq SmallCap Market, (vi) the registration or qualification
of the Securities for offer and sale under the securities or Blue Sky laws of
the several states as provided in Section 5(h) hereof (including the reasonable
fees, expenses and disbursements of counsel for the Underwriters relating to the
preparation, printing or reproduction, and delivery of the preliminary and
supplemental Blue Sky Memoranda and such registration and qualification), (vii)
the filing fees and the fees and expenses of counsel for the Underwriters in
connection with any filings required to be made with the National Association of
Securities Dealers, Inc.; (viii) the transportation and other expenses incurred
by or on behalf of Company representatives in connection with presentations to
prospective purchasers of the Offering Securities; and (ix) the fees and
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<PAGE> 24
expenses of the Company's accountants and the fees and expenses of counsel
(including local and special counsel) for the Company; (x) the expenses of the
Underwriters and counsel for the Underwriters (including Chilean co-counsel) in
connection with the due diligence investigation of the Company; and (xi)
expenses for tombstone advertising not to exceed $12,500.
(b) The Company further agrees that, in addition to the expenses
payable pursuant to subsection (a) of this Section 9, it will pay to the
Representative a non-accountable expense allowance equal to three percent (3 %)
of the gross proceeds received by the Company from the sale of the Offering
Securities, of which $_______ has been paid to date, by certified or bank
cashier's check, or at the election of the Representative, by deduction from the
proceeds of the offering contemplated herein.
10. EFFECTIVE DATE OF AGREEMENT. This Agreement shall become effective:
(i) upon the execution and delivery hereof by the parties hereto; or (ii) if, at
the time this Agreement is executed and delivered, it is necessary for the
registration statement or a post-effective amendment thereto to be declared
effective before the offering of the Offering Securities may commence, when
notification of the effectiveness of the registration statement or such
post-effective amendment has been released by the Commission. Until such time as
this Agreement shall have become effective, it may be terminated by the Company,
by notifying you, or by you, as Representative of the several Underwriters, by
notifying the Company.
If any one or more of the Underwriters shall fail or refuse to purchase
any Firm Shares or Firm Warrants that it or they are obligated to purchase
hereunder on the Initial Closing Date, and the aggregate number of Firm Shares
and Firm Warrants which such defaulting Underwriter or Underwriters are
obligated but fail or refuse to purchase is not more than one-tenth of the
aggregate number of such securities which the Underwriters are obligated to
purchase on the Initial Closing Date, each non-defaulting Underwriter shall be
obligated, severally, in the proportion which the number of Firm Shares and Firm
Warrants set forth opposite its name in Schedule I hereto bears to the aggregate
number of Firm Shares and Firm Warrants set forth opposite the names of all
non-defaulting Underwriters or in such other proportion as you may specify in
accordance with Section 12 of the Master Agreement Among Underwriters of
WerbelRoth Securities, Inc., to purchase the Firm Shares and Firm Warrants which
such defaulting Underwriter or Underwriters are obligated, but fail or refuse,
to purchase. If any one or more of the Underwriters shall fail or refuse to
purchase Shares or Firm Warrants which it or they are obligated to purchase on
the Initial Closing Date and the aggregate number of securities with respect to
which such default occurs is more than one-tenth of the aggregate number of
securities which the Underwriters are obligated to purchase on the Initial
Closing Date and arrangements satisfactory to you and the Company for the
purchase of such Shares by one or more non-defaulting Underwriters or other
party or parties approved by you and the Company are not made within 36 hours
after such default, this Agreement will terminate without liability on the part
of any non-defaulting Underwriter or the Company. In any such case which does
not result in termination of this Agreement, either you or the Company shall
have the right to postpone the Initial Closing Date, but in no event for longer
than seven days, in order that the required changes, if any, in the Registration
Statement and the Prospectus or any other documents or arrangements may be
effected. Any action taken under this paragraph shall not relieve any defaulting
Underwriter from liability in respect of any such default of any such
Underwriter under this Agreement. The term "Underwriter" as used in this
Agreement includes, for all purposes of this Agreement, any party not listed in
Schedule I hereto who, with your approval and the approval of the Company,
purchases Firm Shares or Firm Warrants which a defaulting Underwriter is
obligated, but fails or refuses, to purchase.
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Any notice under this Section 10 may be given by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
11. TERMINATION OF AGREEMENT. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of any
Underwriter to the Company, by notice to the Company, if prior to the Initial
Closing Date or any Option Closing Date (if different from the Initial Closing
Date and then only as to the Additional Securities), as the case may be, (i)
trading in securities generally on the New York Stock Exchange, the American
Stock Exchange or the Nasdaq National Market shall have been suspended or
materially limited, (ii) a general moratorium on commercial banking activities
in New York or Florida shall have been declared by either federal or state
authorities, or (iii) there shall have occurred any outbreak or escalation of
hostilities or other international or domestic calamity, crisis or change in
political, financial or economic conditions, the effect of which on the
financial markets of the United States is such as to make it, in your judgment,
impracticable or inadvisable to commence or continue the offering of the
Offering Securities at the offering price to the public set forth on the cover
page of the Prospectus or to enforce contracts for the resale of the Offering
Securities by the Underwriters. Notice of such termination may be given to the
Company by telegram, telecopy or telephone and shall be subsequently confirmed
by letter.
12. INFORMATION FURNISHED BY THE UNDERWRITERS. The statements set forth
in the last paragraph on the cover page, the stabilization legend on the inside
cover page, and the statements in the first and third paragraphs under the
caption "Underwriting" in any Prepricing Prospectus and in the Prospectus,
constitute the only information furnished by or on behalf of the Underwriters
through you as such information is referred to in Sections 6(b) and 7 hereof.
The first paragraph under the caption "Underwriting" will contain the names and
participations of the underwriters; the third paragraph will contain the selling
concession and the reallowance.
13. MISCELLANEOUS. Except as otherwise provided in Sections 5, 10 and 1
1 hereof, notice given pursuant to any provision of this Agreement shall be in
writing and shall be delivered (i) if to the Company, at the office of the
Company at __________________________ ____________________, Attention: Ricardo
Vilensky, Chief Executive Officer: or (ii) if to you, as Representative of the
several Underwriters, care of Werbel-Roth Securities, Inc., 150 E. Palmetto Park
Road, Suite 510, Boca Raton, Florida 33432, Attention: Howard Roth, President.
This Agreement has been and is made solely for the benefit of the
several Underwriters, the Company, its directors and officers, and the other
controlling persons referred to in Section 7 hereof and their respective
successors and assigns, to the extent provided herein, and no other person shall
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acquire or have any right under or by virtue of this Agreement. Neither the term
"successor" nor the term "successors and assigns" as used in this Agreement
shall include a purchaser from any Underwriter of any of the Shares in his
status as such purchaser.
14. APPLICABLE LAW; COUNTERPARTS. This Agreement shall be governed by
and construed in accordance with the laws of the State of Florida applicable to
contracts made and to be performed within the State of Florida.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall, not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
Please confirm that the foregoing correctly sets forth the agreement
among the Company and the several Underwriters.
Very truly yours,
UNISERVICE CORPORATION
By
-----------------------
Confirmed as of the date first above mentioned on behalf of themselves and the
other several Underwriters named in Schedule I hereto.
Werbel-Roth Securities, Inc.,
as Representative of the Several Underwriters
By
---------------------
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SCHEDULE I
Number of Number of
UNDERWRITER FIRM SHARES FIRM WARRANTS
----------- ----------- -------------
Werbel-Roth Securities, Inc.
TOTAL:
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EXHIBIT A
SUBSIDIARIES
Kentucky Foods Chile, S.A., a Chilean corporation
27
