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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED):
NOVEMBER 19, 1996
AMRESCO, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
STATE OF DELAWARE 0-8630 59-1781257
(STATE OF INCORPORATION) (COMMISSION FILE NO.) (IRS EMPLOYER IDENTIFICATION NO.)
700 NORTH PEARL STREET
SUITE 2400, LB 342
DALLAS, TEXAS 75201-7424
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (214) 953-7700
NO CHANGE
(FORMER NAME OR FORMER ADDRESS, IF CHANGE SINCE LAST REPORT)
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ITEM 5. OTHER EVENTS.
COMMON STOCK OFFERING. On November 19, 1996, AMRESCO, INC. (the "Company")
completed a registered underwritten public offering of 1,828,148 shares of the
Company's common stock, par value $0.05 per share (the "Common Stock"). The
estimated net proceeds from the offering aggregated approximately $36.8 million
and were used to repay borrowings under the Company's Revolving Loan Agreement.
The price to the public was $21.25 per share and the price to the Company per
share was $20.35 (after an underwriting discount of $0.90 per share). The
underwriters were led by The Robinson-Humphrey Company, Inc., Piper Jaffray
Inc., Raymond James & Associates, Inc., Montgomery Securities, J.C. Bradford &
Co. and Morgan Keegan & Company, Inc. In addition, the Company has granted to
the underwriters an option to purchase at the same price and discount up to an
additional 1,164,000 shares of Common Stock to cover overallotments, if any.
This option expires on December 13, 1996.
In addition to the offering of shares of Common Stock by the Company,
certain selling stockholders sold an aggregate of 5,931,852 shares of Common
Stock at the price and underwriting discount described above. The Company did
not receive any proceeds from the sale of the stockholders' shares.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
The following documents are attached hereto as exhibits:
(a) Financial statements of businesses acquired -- not applicable.
(b) Pro forma financial information -- not applicable.
(c) Exhibits:
1.1 Underwriting Agreement, dated November 13, 1996, by and among the
Company, the selling stockholders named on Schedules II and III
thereto, The Robinson-Humphrey Company, Inc., Piper Jaffray Inc.,
Raymond James & Associates, Inc., Montgomery Securities, J.C.
Bradford & Co. and Morgan Keegan & Company, Inc., as
representatives of the underwriters named on Schedule I thereto.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
AMRESCO, INC.
Date: November 27, 1996 By: /s/ L. KEITH BLACKWELL
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Name: L. Keith Blackwell
Title: Vice President, General Counsel
and Secretary
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EXHIBIT INDEX
SEQUENTIAL
EXHIBIT NO. DESCRIPTION OF EXHIBIT PAGE NO.
------------ ---------------------- -------
1.1 Underwriting Agreement, dated November 13, 5
1996, by and among the Company, the selling
stockholders named on Schedules II and III
thereto, The Robinson-Humphrey Company,
Inc., Piper Jaffray Inc., Raymond James &
Associates, Inc., Montgomery Securities, J.C.
Bradford & Co. and Morgan Keegan & Company,
Inc., as representatives of the underwriters
named on Schedule I thereto.
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EXHIBIT 1.1
AMRESCO, INC.
COMMON STOCK
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UNDERWRITING AGREEMENT
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November 13, 1996
THE ROBINSON-HUMPHREY COMPANY, INC.
PIPER JAFFRAY INC.
RAYMOND JAMES & ASSOCIATES, INC.
MONTGOMERY SECURITIES
J.C. BRADFORD & CO.
MORGAN KEEGAN & COMPANY, INC.
As representatives of the several
Underwriters named in Schedule I hereto,
c/o The Robinson-Humphrey Company, Inc.
3333 Peachtree Road, N.E.
Atlanta, Georgia 30326
Dear Sirs:
AMRESCO, INC., a Delaware corporation (the "Company"), proposes, subject to
the terms and conditions stated herein, to issue and sell to the Underwriters
named in Schedule I hereto (the "Underwriters") an aggregate of 1,828,148 shares
of common stock, par value $.05 per share (the "Common Stock"), of the Company
(the "Company Firm Shares"), and certain stockholders of the Company named in
Schedule II hereto (the "Individual Selling Shareholders") and Schedule III
hereto (the "Corporate Selling Shareholders") (the Individual Selling
Shareholders and the Corporate Selling Shareholders are referred to herein
collectively as the "Selling Shareholders") propose, subject to the terms and
conditions stated herein, to sell to the Underwriters an aggregate of 5,931,852
shares of Common Stock in the respective amounts set forth opposite their names
in Schedule II and Schedule III hereto (such shares together with the Company
Firm Shares, the "Firm Shares") and, at the election of the Underwriters,
subject to the terms and conditions stated herein, the Company proposes to sell
to the Underwriters (for the sole purpose of covering over-allotments in
connection with the sale of the Firm Shares) an aggregate of up to 1,164,000
additional shares of Common Stock (the "Optional Shares") (the Firm Shares and
the Optional Shares that the Underwriters elect to purchase pursuant to Section
2 hereof are collectively called the "Shares"). In your capacity as
representatives of the several Underwriters, you are referred to herein as the
"Representatives."
1. (a) REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to, and agrees with, each of the Underwriters (and, with
respect to paragraph (xxii) below, to and with each of the Selling Shareholders)
that:
(i) A registration statement on Form S-3 (File No. 333-13823) with
respect to the Shares, including a prospectus subject to completion,
has been filed by the Company with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as
amended (the "Act"), and one or more amendments to such registration
statement has been so filed. After the execution of this Agreement,
the Company will file with the Commission either (A) if such
registration statement, as it may have been amended, has become
effective under the Act and information has been omitted therefrom in
accordance with Rule 430A under the Act,
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a prospectus in the form most recently included in an amendment to
such registration statement with such changes or insertions as are
required by Rule 430A or permitted by Rule 424(b) under the Act and
as have been provided to and approved by the Representatives, or (B)
if such registration statement, as amended, has not become effective
under the Act, an amendment to such registration statement, including
a form of prospectus, a copy of which amendment has been provided to
and approved by the Representatives prior to the execution of this
Agreement. As used in this Agreement, the term "Registration
Statement" means such registration statement, as amended at the time
when it was or is declared effective, including (i) all financial
statements, schedules and exhibits thereto, (ii) all documents
incorporated by reference therein filed under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and (iii) any
information omitted therefrom pursuant to Rule 430A under the Act and
included in the Prospectus (as hereinafter defined); the term
"Preliminary Prospectus" means each prospectus subject to completion
included in such registration statement or any amendment or
post-effective amendment thereto (including the prospectus subject to
completion, if any, included in the Registration Statement at the
time it was or is declared effective), including all documents
incorporated by reference therein filed under the Exchange Act; and
the term "Prospectus" means the prospectus first filed with the
Commission pursuant to Rule 424(b) under the Act or, if no prospectus
is required to be so filed, such term means the prospectus included
in the Registration Statement, in either case including all documents
incorporated by reference therein filed under the Exchange Act. Any
reference in this Agreement to an "amendment or supplement" to any
Preliminary Prospectus or the Prospectus or an "amendment" to any
registration statement (including the Registration Statement) shall
be deemed to include any document incorporated by reference therein
and filed with the Commission under the Exchange Act after the date
of such Preliminary Prospectus, Prospectus or Registration Statement,
as the case may be. As used herein, any reference to any statement
or information as being "made", "included", "contained", "disclosed",
or "set forth" in any Preliminary Prospectus, a Prospectus or any
amendment or supplement thereto, or the Registration Statement or any
amendment thereto (or other similar references) shall refer both to
information and statements actually appearing in such document as
well as information and statements incorporated by reference therein.
(ii) No order preventing or suspending the use of any Preliminary
Prospectus has been issued and no proceeding for that purpose has been
instituted or overtly threatened by the Commission or the securities
authority of any state or other jurisdiction in which the Shares are to
be offered or sold. If the Registration Statement has become effective
under the Act, no stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued and no
proceeding for that purpose has been instituted or overtly threatened
or, to the Company's knowledge, contemplated by the Commission or the
securities authority of any state or other jurisdiction in which the
Shares are to be offered or sold.
(iii) When any Preliminary Prospectus and any amendment or
supplement thereto was filed with the Commission it (A) contained all
statements required to be stated therein in accordance with, and
complied in all material respects with the requirements of, the Act and
the rules and regulations of the Commission thereunder, and (B) did not
include 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.
When the Registration Statement or any amendment thereto was or is
declared effective, and at each Time of Delivery (as hereinafter
defined), it (A) contained or will contain all statements required to
be stated therein in accordance with, and complied or will comply in
all material respects with the requirements of, the Act and the rules
and regulations of the Commission thereunder, and (B) did not or will
not include any untrue statement of a material
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fact or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they
were made, not misleading. When the Prospectus or any amendment or
supplement thereto is filed with the Commission pursuant to Rule
424(b) (or, if the Prospectus or such amendment or supplement is not
required to be so filed, when the Registration Statement or the
amendment thereto containing such amendment or supplement to the
Prospectus was or is declared effective) and at each Time of
Delivery, the Prospectus, as amended or supplemented at any such
time, (A) contained or will contain all statements required to be
stated therein in accordance with, and complied or will comply in all
material respects with the requirements of, the Act and the rules and
regulations of the Commission thereunder, and (B) did not or will not
include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading. The foregoing provisions of this paragraph (iii) do not
apply to statements or omissions made in any Preliminary Prospectus
and any amendment or supplement thereto, the Registration Statement
or any amendment thereto, or the Prospectus or any amendment or
supplement thereto in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein.
(iv) The descriptions in the Registration Statement and the
Prospectus of statutes, legal and governmental proceedings or contracts
and other documents are accurate and fairly present in all material
respects the information required to be shown; and there are no
statutes or legal or governmental proceedings required to be described
in the Registration Statement or the Prospectus that are not described
as required and there are no contracts or documents of a character that
are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement
that are not described and filed as required.
(v) The documents or information incorporated by reference in the
Prospectus, when such documents or the documents from which such
information was incorporated, including any amendments to such
documents, were filed with the Commission, conformed in all materials
respects to the requirements of the Exchange Act and the rules and
regulations of the Commission thereunder, and none of such documents or
information 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, in light of the circumstances under which
they were made, not misleading, and any further documents so filed and
incorporated by reference in the Prospectus, when such documents are
filed with the Commission, will conform in all material respects to the
requirements of the Exchange Act and the rules and regulations of the
Commission thereunder 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, in light of the
circumstances under which they were made, not misleading.
(vi) Each of the Company and its material subsidiaries (which
consist of AMRESCO Residential Mortgage Corporation, Holliday Fenoglio,
Inc., AMRESCO Management, Inc., AMRESCO Residential Credit Corporation,
AMRESCO Capital Corporation, AMRESCO Residential Securities Corporation
and AMRESCO Principal Managers I, Inc. (the "Material Subsidiaries"))
has been duly incorporated, is validly existing as a corporation in
good standing under the laws of its jurisdiction of incorporation, and
has full corporate power and authority to own or lease its properties
and conduct its business as described in the Prospectus. The Company
has full corporate power and authority to enter into this Agreement and
to perform its obligations hereunder. Each of the Company and its
subsidiaries is duly qualified to transact business as a foreign
corporation and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or conducts any
business, so as to require such
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qualification, except where the failure to so qualify would not have
a material adverse effect on the financial position, results of
operations or business of the Company and its subsidiaries taken as a
whole.
(vii) The Company's authorized, issued and outstanding capital
stock is as disclosed in the Prospectus. All of the issued shares of
capital stock of the Company have been duly authorized and validly
issued, are fully paid and nonassessable and conform to the description
of the Common Stock contained in the Prospectus. None of the issued
shares of capital stock of the Company or its predecessors or any of
its subsidiaries has been issued or is owned or held in violation of
any preemptive rights of shareholders, and no person or entity
(including any holder of outstanding shares of capital stock of the
Company or its subsidiaries) has any preemptive or other rights to
subscribe for any of the Shares.
(viii) All of the issued shares of capital stock of each of the
Company's subsidiaries have been duly authorized and validly issued,
are fully paid and nonassessable and, except as otherwise noted in the
Registration Statement or the Prospectus, are owned, directly or
indirectly, beneficially by the Company free and clear of all liens,
security interests, pledges, charges, encumbrances, defects,
shareholders' agreements, voting trusts, equities or claims of any
nature whatsoever.
(ix) Except as disclosed in the Prospectus, there are no outstanding
(A) securities or obligations of the Company or any of its subsidiaries
convertible into or exchangeable for any capital stock of the Company
or any such subsidiary, (B) warrants, rights or options to subscribe
for or purchase from the Company or any such subsidiary any such
capital stock or any such convertible or exchangeable securities or
obligations, or (C) obligations of the Company or any such subsidiary
to issue any shares of capital stock, any such convertible or
exchangeable securities or obligations, or any such warrants, rights or
options.
(x) Since the date of the most recent audited financial statements
included in the Prospectus, neither the Company nor any of its
subsidiaries has sustained any material loss or interference with its
business, which loss or interference was material to the Company and
its subsidiaries taken as a whole, from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as disclosed in or contemplated by the Prospectus.
(xi) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, (A) neither the Company
nor any of its subsidiaries has incurred any liabilities or
obligations, direct or contingent, or entered into any transactions,
not in the ordinary course of business, that are material to the
Company and its subsidiaries taken as a whole, (B) the Company has not
purchased any of its outstanding capital stock or declared, paid or
otherwise made any dividend or distribution of any kind on its capital
stock, (C) there has not been any change in the capital stock (except
as a result of shares issued upon exercise of stock options pursuant to
existing stock option plans of the Company and its subsidiaries and
upon conversion of the Company's 8% Convertible Subordinated Debentures
due 2005), long-term debt or, otherwise than in the ordinary course of
business consistent with past practice, short-term debt of the Company
or any of its subsidiaries, and (D) there has not been any material
adverse change, or any development involving a prospective material
adverse change, in or affecting the financial position, results of
operations or business of the Company and its subsidiaries taken as a
whole, in each case other than as disclosed in or contemplated by the
Prospectus.
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(xii) The Shares to be issued and sold by the Company have been
duly authorized and, when issued and delivered against payment therefor
as provided herein, will be validly issued and fully paid and
nonassessable and will conform to the description of the Common Stock
contained in the Prospectus; and the certificates evidencing the Shares
will comply with all applicable requirements of Delaware law.
(xiii) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Act with respect to any securities of
the Company owned or to be owned by such person or to require the
Company to include such securities in the securities registered
pursuant to the Registration Statement (or any such right has been
effectively waived) or any securities being registered pursuant to any
other registration statement filed by the Company under the Act.
(xiv) All offers and sales of the Company's capital stock prior to
the date hereof were at all relevant times duly registered under the
Act or exempt from the registration requirements of the Act and were
duly registered or the subject of an available exemption from the
registration requirements of the applicable state securities or blue
sky laws.
(xv) Neither the Company nor any of its subsidiaries is, and no
event has occurred that with the giving of notice or passage of time or
both would cause the Company or any of its subsidiaries to be, (A) in
violation of its Articles or Certificate of Incorporation or Bylaws or
(B) in default under any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which the Company
or any of its subsidiaries is a party or to which any of their
respective properties or assets are subject and which in the case of
clause (B) of this sentence is material to the Company and its
subsidiaries taken as a whole.
(xvi) The issue and sale of the Shares to be issued and sold by
the Company and the performance of this Agreement and the consummation
of the transactions herein contemplated (A) will not conflict with, or
(with or without the giving of notice or the passage of time or both)
result in a breach or violation of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed of trust,
loan agreement, lease or other material agreement or instrument to
which the Company or any of its subsidiaries is a party or to which any
of their respective properties or assets is subject and in the case of
this clause (A), which is material to the Company and its subsidiaries
taken as a whole, nor (B) will such action conflict with or violate any
provision of the Articles or Certificate of Incorporation or Bylaws of
the Company or any of its subsidiaries or any statute, rule or
regulation or any order, judgment or decree of any court or
governmental agency or body having jurisdiction over the Company or any
of its subsidiaries or any of their respective properties or assets.
(xvii) The Company and its 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 the Prospectus or such as
do not materially and adversely affect the value of those properties
which individually or in the aggregate are material to the Company and
its subsidiaries taken as a whole and do not interfere with the use
made or proposed to be made of such property by the Company or any one
of its subsidiaries, as the case may be; and any real property and
buildings held under lease by the Company or any of its subsidiaries
are held under valid, subsisting and enforceable leases, with such
exceptions as are disclosed in the Prospectus or are not material and
do not interfere with the use made or proposed to be made of such
property and buildings by the Company or such subsidiary.
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(xviii) No consent, approval, authorization, order or declaration of
or from, or registration, qualification or filing with, any court or
governmental agency or body is required for the sale of the Shares or
the consummation of the transactions contemplated by this Agreement,
except the registration of the Shares under the Act (which, if the
Registration Statement is not effective as of the time of execution
hereof, shall be obtained as provided in this Agreement) and such as
may be required under state securities or blue sky laws in connection
with the offer, sale and distribution of the Shares by the
Underwriters.
(xix) There is no litigation, arbitration, claim, proceeding
(formal or informal) or investigation pending or overtly threatened (or
any basis therefor) (A) in which the Company or any of its subsidiaries
is a party or (B) of which any of their respective properties or assets
are the subject which, in the case of clauses (A) and (B) of this
sentence, if determined adversely to the Company or any such
subsidiary, could reasonably be expected to have, individually or in
the aggregate, a material adverse effect on the financial position,
results of operations or business of the Company and its subsidiaries,
taken as a whole. Neither the Company nor any of its subsidiaries is
in violation of, or in default with respect to, any statute, rule,
regulation, order, judgment or decree, except as do not and will not
individually or in the aggregate have a material adverse effect on the
financial position, results of operations or business of the Company
and its subsidiaries, taken as a whole, and neither the Company nor any
of its subsidiaries is required to take any action in order to avoid
any such violation or default.
(xx) Deloitte & Touche LLP, who have certified certain financial
statements of the Company and its consolidated subsidiaries, are and
were during the periods covered by their reports included in the
Registration Statement and the Prospectus, independent public
accountants as required by the Act and the Exchange Act and the
respective rules and regulations of the Commission thereunder.
(xxi) The consolidated financial statements and schedules
(including the related notes) of the Company and its consolidated
subsidiaries and predecessor and acquired businesses included in the
Registration Statement, the Prospectus or any Preliminary Prospectus
were prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods involved (except
as otherwise stated therein) and fairly present the financial position
and results of operations of the Company and its subsidiaries or its
predecessor or acquired businesses, as the case may be, at the dates
and for the periods presented. The other financial and statistical
information and data included in the Registration Statement, the
Prospectus or any Preliminary Prospectus set forth under the captions
"Summary Historical Financial and Other Data" and "Summary" in the
Prospectus are, in all material respects, accurately presented and
prepared on a basis consistent with such financial statements and the
books and records of the Company.
(xxii) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes the valid and 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 and
subject, as to enforcement, to applicable bankruptcy, insolvency,
reorganization and moratorium laws and other laws relating to or
affecting the enforcement of creditors' rights generally and to general
equitable principles.
(xxiii) Neither the Company nor any of its officers, directors or
affiliates has (A) taken, directly or indirectly, any action designed
to cause or result in, or that has constituted or might reasonably be
expected to constitute, the stabilization or manipulation of the price
of any
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security of the Company to facilitate the sale or resale of the Shares,
or (B) since the filing of the Registration Statement, sold, or
paid anyone any compensation for soliciting purchases of, the Shares.
(xxiv) The Company has obtained for the benefit of the Company and
the Underwriters from each of its directors, executive officers and
certain of the Selling Shareholders a written agreement that for a
period of 120 days from the date of the Prospectus such director,
executive officer or Selling Shareholder will not, without the written
consent of the Representatives, offer, pledge, sell, contract to sell,
grant any option for the sale of, or otherwise dispose of (or announce
any offer, pledge, sale, grant of an option to purchase or other
disposition), directly or indirectly, any shares of Common Stock or
securities convertible into, or exercisable or exchangeable for, shares
of Common Stock except pursuant to bona fide gifts to persons who agree
in writing to be bound by the terms of such agreement or pursuant to
the laws of descent and distribution.
(xxv) Neither the Company nor any of its subsidiaries, nor any
director, officer, agent, employee or other person associated with or
acting on behalf of the Company or any such subsidiary has, directly or
indirectly: used any corporate funds for unlawful contributions, gifts,
entertainment or other unlawful expenses relating to political
activity; made any unlawful payment to foreign or domestic government
officials or employees or to foreign or domestic political parties or
campaigns from corporate funds; violated any provision of the Foreign
Corrupt Practices Act of 1977, as amended; or made any bribe, rebate,
payoff, influence payment, kickback or other unlawful payment.
(xxvi) To the Company's knowledge, the operations of the Company
and its subsidiaries with respect to any real property currently leased
or owned or by any means controlled by the Company or any subsidiary
(the "Real Property") are in compliance with all federal, state, and
local laws, ordinances, rules, and regulations relating to occupational
health and safety and the environment (collectively, "Laws"), except
where the failure to so comply would not have a material adverse effect
on the Company's and its subsidiaries' business or results of
operations taken as a whole, and the Company and its subsidiaries have
all licenses, permits and authorizations necessary to operate under all
Laws and are in compliance with all terms and conditions of such
licenses, permits and authorizations, except where such failure would
not have a material adverse effect on the Company's and its
subsidiaries' business or results of operations taken as a whole;
neither the Company nor any subsidiary has authorized, conducted or has
knowledge of the generation, transportation, storage, use, treatment,
disposal or release of any hazardous substance, hazardous waste,
hazardous material, hazardous constituent, toxic substance, pollutant,
contaminant, petroleum product, natural gas, liquefied gas or synthetic
gas defined or regulated under any environmental law on, in or under
any Real Property in violation of any Laws except where such violation
would not have a material adverse effect on the Company's and its
subsidiaries' business or results of operations taken as a whole; and
there is no material pending or threatened claim, litigation or any
administrative agency proceeding, nor has the Company or any subsidiary
received any written or oral notice from any governmental entity or
third party that: (A) alleges a violation of any Laws by the Company or
any subsidiary; (B) alleges the Company or any subsidiary is a liable
party under the Comprehensive Environmental Response, Compensation, and
Liability Act, 42 U.S.C. Section 9601 ET SEQ. or any state superfund
law; (C) alleges possible contamination of the environment by the
Company or any subsidiary; or (D) alleges possible contamination of the
Real Property, except as to each of the above, for any violations,
liability or contamination that would not have a material adverse
effect on the Company's and its subsidiaries' business or results of
operations taken as a whole.
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(xxvii) The Company and its subsidiaries own or have the right to
use all patents, patent applications, trademarks, trademark
applications, trade names, service marks, copyrights, franchises, trade
secrets, proprietary or other confidential information and intangible
properties and assets (collectively, "Intangibles") necessary to their
respective businesses as presently conducted or as the Prospectus
indicates the Company or such subsidiary proposes to conduct; to the
Company's knowledge, neither the Company nor any subsidiary has
infringed or is infringing, and neither the Company nor any subsidiary
has received notice of infringement with respect to, asserted
Intangibles of others; and, to the Company's knowledge, there is no
infringement by others of Intangibles of the Company or any of its
subsidiaries which would have a material adverse effect on the Company
and its subsidiaries taken as a whole.
(xxviii) The Company and each of its subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the
businesses in which they are engaged by similarly-situated companies;
and neither the Company nor any such subsidiary has any reason to
believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar
coverage from similar insurers as may be necessary to continue its
business at a comparable cost, except as disclosed in the Prospectus.
(xxix) Each of the Company and its subsidiaries makes and keeps
accurate books, records and accounts, which, in reasonable detail,
accurately and fairly reflect the transactions and dispositions of its
assets and maintains a system of internal accounting controls
sufficient to provide reasonable assurance that (A) transactions are
executed in accordance with management's general and specific
authorization, (B) transactions are recorded as necessary to permit
preparation of the Company's consolidated financial statements in
accordance with generally accepted accounting principles and to
maintain accountability for the assets of the Company, (C) access to
the assets of the Company and each of its subsidiaries is permitted
only in accordance with management's general and specific
authorization, and (D) the recorded accountability for assets of the
Company and each of its subsidiaries is compared with existing assets
at reasonable intervals and appropriate action is taken with respect to
any differences.
(xxx) No subsidiary of the Company is currently prohibited,
directly or indirectly, from paying any dividends to the Company, from
making any other distributions on such subsidiary's capital stock, from
repaying to the Company any loans or advances to such subsidiary or
from transferring any of such subsidiary's property or assets to the
Company or any other subsidiary of the Company, except as disclosed in
the Prospectus.
(xxxi) The Company and its subsidiaries have filed all foreign,
federal, state and local tax returns that are required to be filed by
them and, other than taxes the Company or its subsidiaries are
contesting, have paid all taxes shown as due on such returns as well as
all other taxes, assessments and governmental charges that are due and
payable; and no deficiency with respect to any such return has been
assessed or proposed.
(xxxii) The Company is not, will not become as a result of the
transactions contemplated hereby, and does not intend to conduct its
business in a manner that would cause it to become, an "investment
company" or a company "controlled" by an "investment company" within
the meaning of the Investment Company Act of 1940.
(xxxiii) The Common Stock is registered pursuant to Section 12(g) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and is qualified as a Nasdaq National Market security of The Nasdaq
Stock Market, Inc. The Company has taken no action designed
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to terminate, or likely to have the effect of terminating, the
registration of the Common Stock under the Exchange Act or
qualification of the Common Stock on the Nasdaq National Market, nor
has the Company received any notification that the Commission or the
NASD is contemplating terminating such registration or qualification.
(xxxiv) The conditions for use of a Registration Statement on Form
S-3 set forth in the General Instructions to Form S-3 have been
satisfied with respect to the Company and the transactions contemplated
by this Agreement and the Registration Statement.
(b) REPRESENTATIONS AND WARRANTIES OF THE SELLING SHAREHOLDERS.
Each Selling Shareholder, severally and not jointly, and subject to the
fulfillment by CGW Southeast Partners I, L.P. ("CGWI") and CGW Southeast
Partners II, L.P. ("CGWII") of their obligations under that certain Letter
Agreement dated October 31, 1996 relating to the distribution of shares of
Common Stock from CGWI and CGWII to the Selling Shareholders, represents and
warrants to, and agrees with, each of the several Underwriters, the Company and
each other that:
(i) Such Selling Shareholder has full right, power (corporate and
other) and authority to enter into this Agreement, the Power of
Attorney and the Custody Agreement (as hereinafter defined) and to
sell, assign, transfer and deliver to the Underwriters the Shares to be
sold by such Selling Shareholder hereunder; and the execution and
delivery of this Agreement, the Power of Attorney and the Custody
Agreement have been duly authorized by all necessary action of such
Selling Shareholder.
(ii) Such Selling Shareholder has duly executed and delivered this
Agreement, the Power of Attorney and the Custody Agreement, and each
constitutes the valid and binding agreement of such Selling Shareholder
enforceable against such Selling Shareholder in accordance with its
terms, subject, as to enforcement, to applicable bankruptcy,
insolvency, reorganization and moratorium laws and other laws relating
to or affecting the enforcement of creditors' rights generally and to
general equitable principles.
(iii) No consent, approval, authorization, order or declaration of
or from, or registration, qualification or filing with, any court or
governmental agency or body is required for the sale of the Shares to
be sold by such Selling Shareholder or the consummation of the
transactions contemplated by this Agreement, the Power of Attorney or
the Custody Agreement, except the registration of such Shares under the
Act (which, if the Registration Statement is not effective as of the
time of execution hereof, shall be obtained as provided in this
Agreement) and such as may be required under state securities or blue
sky laws in connection with the offer, sale and distribution of such
Shares by the Underwriters, which, if such consent, approval,
authorization, order or declaration were not obtained, would materially
affect the ability of such Selling Shareholder to consummate the
transactions contemplated by this Agreement, the Power of Attorney or
the Custody Agreement.
(iv) The sale of the Shares to be sold by such Selling Shareholder
and the performance of this Agreement, the Power of Attorney and the
Custody Agreement and the consummation of the transactions herein and
therein contemplated will not conflict with, or (with or without the
giving of notice or the passage of time or both) result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, any material indenture, mortgage, deed of trust, loan agreement,
lease or other agreement or instrument to which such Selling
Shareholder is a party or to which any of such Selling Shareholder's
respective properties or assets is subject, which breach, violation or
default would have a material adverse impact on the ability of such
Selling Shareholder to consummate the transactions contemplated by this
Agreement,
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the Power of Attorney and the Custody Agreement; nor will such action
conflict with or violate any provision of the Articles of
Incorporation or Bylaws or other governing instruments (if
applicable) of such Selling Shareholder; nor will such action
conflict with or violate any statute, rule or regulation or any
order, judgment or decree of any court or governmental agency or body
having jurisdiction over such Selling Shareholder or any of such
Selling Shareholder's properties or assets which conflict or
violation would have a material adverse impact on the ability of such
Selling Shareholder to consummate the transactions contemplated by
this Agreement, the Power of Attorney and the Custody Agreement.
(v) Such Selling Shareholder has, and immediately prior to each
Time of Delivery (as hereinafter defined), such Selling Shareholder
will have, good and valid title to the Shares to be sold by such
Selling Shareholder hereunder, free and clear of all liens, security
interests, pledges, charges, encumbrances, defects, shareholders'
agreements, voting trusts, equities or claims of any nature whatsoever;
and, upon delivery of such Shares against payment therefor as provided
herein, good and valid title to such Shares, free and clear of all
liens, security interests, pledges, charges, encumbrances, defects,
shareholders' agreements, voting trusts, equities or claims of any
nature whatsoever, will pass to the several Underwriters.
(vi) Neither such Selling Shareholder nor any of such Selling
Shareholder's officers, directors or affiliates has (A) taken, directly
or indirectly, any action designed to cause or result in, or that has
constituted or might reasonably be expected to constitute, the
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Shares, or (B) since
the filing of the Registration Statement (1) sold, bid for, purchased
or paid anyone any compensation for soliciting purchases of, the Shares
or (2) paid or agreed to pay to any person any compensation for
soliciting another to purchase any other securities of the Company.
(vii) All information furnished in writing by or on behalf of such
Selling Shareholder and contained under the caption "Selling
Stockholders" in the Registration Statement and Prospectus (A) is
currently, (B) was at the time of the filing of any Prospectus with the
Commission, (C) was at the time the Registration Statement was declared
effective by the Commission, and (D) will be at closing, correct and
complete (other than the name of the Trustee of the Delta Master Trust
which was incorrectly designated as Citibank N.A., rather than Citibank
F.S.B. and other than the number of shares shown as beneficially owned
before and after the offering by Palmer & Cay/Carswell, Inc., which was
understated by 2,313 shares) and does not include any untrue statement
of a material fact or omit to state any material fact necessary in
order to make such information not misleading.
(c) REPRESENTATIONS AND WARRANTIES OF INSIDE SHAREHOLDERS. Each of
Messrs. Richard L. Cravey, William S. Green, Edwin A. Wahlen, Jr., William A.
Davies and Bart A. McLean (collectively, the "Inside Shareholders"), severally
and not jointly, represents and warrants to, and agrees with each of the several
Underwriters and the Company (and, with respect to paragraph 1(a)(xxii) above,
to and with each of the Selling Shareholders), that such Inside Shareholder,
without undertaking any independent investigation, is not aware that any of the
representations or warranties set forth in Section 1(a) above is untrue or
inaccurate in any material respect. Such Inside Shareholder has also reviewed
the Preliminary Prospectus, the Registration Statement and the Prospectus and
with respect to such documents, has no knowledge of any untrue statement of a
material fact or omission of any material fact necessary in order to make the
statements made therein, in the light of the circumstances under which they were
made, not misleading.
In order to document the Underwriters' compliance with the reporting and
withholding provisions of the Internal Revenue Code of 1986, as amended, with
respect to the transactions herein contemplated, each
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of the Selling Shareholders agrees to deliver to you prior to or at each Time
of Delivery (as hereinafter defined) a properly completed and executed United
States Treasury Department Form W-9 (or other applicable form or statement
specified by Treasury Department regulations in lieu thereof).
Each of the Selling Shareholders represents and warrants that certificates
in negotiable form representing all of the Shares to be sold by such Selling
Shareholder hereunder have been placed in custody under a Custody Agreement, in
the form heretofore furnished to and approved by you, duly executed and
delivered by such Selling Shareholder to SunTrust Bank, as custodian (the
"Custodian"), and that such Selling Shareholder has duly executed and delivered
a Power of Attorney, in the form heretofore furnished to and approved by you,
appointing the persons indicated in Schedule II or Schedule III hereto, as the
case may be, as such Selling Shareholder's attorneys-in-fact (the "Attorneys-in-
Fact") with authority to execute and deliver this Agreement on behalf of such
Selling Shareholder, to determine the purchase price to be paid by the
Underwriters to the Selling Shareholders as provided in Section 2 hereof, to
authorize the delivery of the Shares to be sold by such Selling Shareholder
hereunder, and otherwise to act on behalf of such Selling Shareholder in
connection with the transactions contemplated by this Agreement and the Custody
Agreement.
Each of the Selling Shareholders specifically agrees that the Shares
represented by the certificates held in custody for such Selling Shareholder
under the Custody Agreement are subject to the interests of the Underwriters
hereunder, and that the arrangements made by such Selling Shareholder for such
custody, and the appointment by such Selling Shareholder of the Attorneys-in-
Fact by the Power of Attorney, are irrevocable. Each of the Selling
Shareholders specifically agrees that the obligations of the Selling
Shareholders hereunder shall not be terminated by operation of law, whether by
the death or incapacity of any individual Selling Shareholder or, in the case of
an estate or trust, by the death or incapacity of any executor or trustee or the
termination of such estate or trust, or in the case of a partnership or
corporation, by the dissolution of such partnership or corporation, or by the
occurrence of any other event.
2. PURCHASE AND SALE OF SHARES. Subject to the terms and conditions
herein set forth, (a) the Company and each Selling Shareholder agree, severally
and not jointly, to sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company and
each Selling Shareholder, at a purchase price of $20.35 per share, the number of
Firm Shares (to be adjusted by the Representatives so as to eliminate fractional
shares) determined by multiplying the aggregate number of (i) Company Firm
Shares to be sold by the Company and (ii) the number of Firm Shares to be sold
by the Selling Shareholders as set forth opposite their respective names in
Schedule II and Schedule III hereto by a fraction, the numerator of which is the
aggregate number of Firm Shares to be purchased by such Underwriter as set forth
opposite the name of such Underwriter in Schedule I hereto, and the denominator
of which is the aggregate number of Firm Shares to be purchased by the
Underwriters from the Company and the Selling Shareholders hereunder, and (b) in
the event and to the extent that the Underwriters shall exercise the election to
purchase Optional Shares as provided below, the Company agrees to sell to each
of the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at the purchase price per share set forth
in clause (a) of this Section 2, that portion of the number of Optional Shares
as to which such election shall have been exercised (to be adjusted by the
Representatives so as to eliminate fractional shares) determined by multiplying
such number of Optional Shares to be sold by the Company by a fraction, the
numerator of which is the maximum number of Optional Shares that such
Underwriter is entitled to purchase as set forth opposite the name of such
Underwriter in Schedule I hereto and the denominator of which is the maximum
number of the Optional Shares that all of the Underwriters are entitled to
purchase hereunder.
The Company hereby grants to the Underwriters the right to purchase at
their election in whole or in part from time to time up to an aggregate of
1,164,000 Optional Shares, at the purchase price per share set forth in clause
(a) in the paragraph above, for the sole purpose of covering over-allotments in
the sale of Firm Shares. Any such election to purchase Optional Shares may be
exercised by written notice from the
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Representatives to the Company, given from time to time within a period of 30
calendar days after the date of this Agreement and setting forth the
aggregate number of Optional Shares to be purchased and the date on which
such Optional Shares are to be delivered, as determined by you but in no
event earlier than the First Time of Delivery (as hereinafter defined) or,
unless the Representatives and the Company otherwise agree in writing,
earlier than two or later than ten business days after the date of such
notice. In the event you elect to purchase all or a portion of the Optional
Shares, the Company agrees to furnish or cause to be furnished to you the
certificates, letters and opinions, and to satisfy all applicable conditions,
set forth in Section 7 hereof at each Subsequent Time of Delivery (as
hereinafter defined).
3. OFFERING BY THE UNDERWRITERS. Upon the authorization by the
Representatives of the release of the Shares, the several Underwriters propose
to offer the Shares for sale upon the terms and conditions disclosed in the
Prospectus.
4. DELIVERY OF SHARES; CLOSING. Certificates in definitive form for the
Shares to be purchased by each Underwriter hereunder, and in such denominations
and registered in such names as The Robinson-Humphrey Company, Inc. may request
upon at least 48 hours' prior notice to the Company shall be delivered by or on
behalf of the Company and the Selling Shareholders to the Representatives for
the account of such Underwriter, against payment by such Underwriter on its
behalf of the purchase price therefor, by wire transfer to accounts designated
by the Company and each of the Selling Shareholders in immediately available
funds. The closing of the sale and purchase of the Shares shall be held at the
offices of Smith, Gambrell & Russell, LLP, 3343 Peachtree Road, N.E., Atlanta,
Georgia 30326, except that physical delivery of such certificates shall be made
at the office of The Depository Trust Company, 55 Water Street, New York, New
York 10041. The time and date of such delivery and payment shall be, with
respect to the Firm Shares, at 10:00 a.m., Atlanta time, on the third (or, if
the Shares are priced, as contemplated by Rule 15c6-1(c), promulgated pursuant
to the Exchange Act, after 4:30 p.m. Washington, D.C. time, the fourth) full
business day after this Agreement is executed or at such other time and date as
the Representatives, the Company and the Attorneys-in-Fact, on behalf of the
Selling Shareholders, may agree upon in writing, and, with respect to the
Optional Shares, at 10:00 a.m., Atlanta time, on the date specified by the
Representatives in the written notice given by the Representatives of the
Underwriters' election to purchase all or part of such Optional Shares, or at
such other time and date as the Representatives and the Company may agree upon
in writing. Such time and date for delivery of the Firm Shares is herein called
the "First Time of Delivery," such time and date for delivery of any Optional
Shares, if not the First Time of Delivery, is herein called a "Subsequent Time
of Delivery," and each such time and date for delivery is herein called a "Time
of Delivery." The Company will make such certificates available for checking and
packaging at least 24 hours prior to each Time of Delivery at the office of The
Depository Trust Company, 55 Water Street, New York, New York 10041 or at such
other location in New York, New York specified by the Representatives in writing
at least 48 hours prior to such Time of Delivery.
5. (a) COVENANTS OF THE COMPANY. The Company covenants and agrees with
each of the Underwriters:
(i) If the Registration Statement has been declared effective prior
to the execution and delivery of this Agreement, the Company will file the
Prospectus with the Commission pursuant to and in accordance with Rule
424(b)(1) (or, if applicable and if consented to by the Representatives,
Rule 424(b)(4)) not later than the earlier of (A) the second business day
following the execution and delivery of this Agreement or (B) the fifteenth
business day after the date on which the Registration Statement is declared
effective. The Company will advise you promptly of any such filing
pursuant to Rule 424(b).
(ii) The Company will not file with the Commission the Prospectus or
the amendment referred to in the second sentence of Section l(a)(i) hereof,
any amendment or supplement to the
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Prospectus or any amendment to the Registration Statement unless the
Representatives have received a reasonable period of time to review any
such proposed amendment or supplement and consented to the filing thereof
and will use its best efforts to cause any such amendment to the
Registration Statement to be declared effective as promptly as possible.
Upon the reasonable request of the Representatives or counsel for the
Underwriters, the Company will promptly prepare and file with the
Commission, in accordance with the rules and regulations of the Commission,
any amendments to the Registration Statement or amendments or supplements
to the Prospectus that may be necessary or advisable in connection with the
distribution of the Shares by the several Underwriters and will use its
best efforts to cause any such amendment to the Registration Statement to
be declared effective as promptly as possible. If required, the Company
will file any amendment or supplement to the Prospectus with the Commission
in the manner and within the time period required by Rule 424(b) under the
Act. The Company will advise the Representatives, promptly after receiving
notice thereof, of the time when the Registration Statement or any
amendment thereto has been filed or declared effective or the Prospectus
or any amendment or supplement thereto has been filed and will provide
evidence to the Representatives of each such filing or effectiveness.
(iii) The Company will advise the Representatives promptly after
receiving notice or obtaining knowledge of (A) the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or any part thereof or any order preventing or
suspending the use of any Preliminary Prospectus or the Prospectus or any
amendment or supplement thereto, (B) the suspension of the qualification of
the Shares for offer or sale in any jurisdiction or of the initiation or
threatening of any proceeding for any such purpose, or (C) any request made
by the Commission or any securities authority of any other jurisdiction for
amending the Registration Statement, for amending or supplementing the
Prospectus or for additional information. The Company will use its best
efforts to prevent the issuance of any such stop order and, if any such
stop order is issued, to obtain the withdrawal thereof as promptly as
possible.
(iv) If the delivery of a Prospectus relating to the Shares is
required under the Act at any time prior to the expiration of nine months
after the date of the Prospectus and if at such time any events have
occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, or if for any reason it is necessary during such same period to
amend or supplement the Prospectus or to file under the Exchange Act any
document incorporated by reference in the Prospectus to comply with the Act
or the Exchange Act or the respective rules and regulations thereunder, the
Company will promptly notify the Representatives and upon the request of
the Representatives (but at the Company's expense) prepare and file with
the Commission an amendment or supplement to the Prospectus or any such
incorporated document that corrects such statement or omission or effects
such compliance and will furnish without charge to each Underwriter and to
any dealer in securities as many copies of such amended or supplemented
Prospectus as you may from time to time reasonably request. If the
delivery of a prospectus relating to the Shares is required under the Act
at any time nine months or more after the date of the Prospectus, upon
request of the Representatives but at the expense of such Underwriter, the
Company will prepare and deliver to such Underwriter as many copies as the
Representatives may request of an amended or supplemented Prospectus
complying with Section 10(a)(3) of the Act. Without limiting the
application of this sentence, the Company will use its best efforts to, not
later than (A) 6:00 p.m., New York City time, on the date of determination
of the public offering price, if such determination occurred at or prior to
12:00 Noon, New York City time, on such date or (B) 6:00 p.m., New York
City time, on the business day following the date of determination of the
public offering price, if such determination occurred after 12:00 Noon, New
York City time, on such date, deliver to the Representatives, without
charge, as many copies of the Prospectus and any amendment or supplement
thereto as the
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Representatives may reasonably request for purposes of confirming orders
that are expected to settle on the First Time of Delivery. Neither the
Representatives' consent to, nor the Underwriters' delivery of, any such
amendment or supplement shall constitute a waiver of any of the
conditions set forth in Section 7.
(v) The Company promptly from time to time will take such action as
the Representatives may reasonably request to qualify the Shares for
offering and sale under the securities or blue sky laws of such
jurisdictions as the Representatives may request and will continue such
qualifications in effect for as long as may be necessary to complete the
distribution of the Shares, provided that in connection therewith the
Company shall not be required to qualify as a foreign corporation or to
file a general consent to service of process in any jurisdiction.
(vi) The Company will promptly provide the Representatives, without
charge, (A) two manually executed copies of the Registration Statement as
originally filed with the Commission and of each amendment thereto,
including all documents or information incorporated by reference therein,
(B) for each other Underwriter a conformed copy of the Registration
Statement and of each amendment thereto, without exhibits but including all
documents or information incorporated by reference therein, and (C) so long
as a prospectus relating to the Shares is required to be delivered under
Act, as many copies of each Preliminary Prospectus or the Prospectus or any
amendment or supplement thereto as the Representatives may reasonably
request.
(vii) As soon as practicable, but in any event not later than the
last day of the fifteenth month after the effective date of the
Registration Statement, the Company will make generally available to its
security holders an earnings statement of the Company and its subsidiaries,
if any, covering a period of at least 12 months beginning after the
effective date of the Registration Statement (which need not be audited)
complying with Section 11(a) of the Act and the rules and regulations
thereunder.
(viii) During the period beginning from the date hereof and
continuing to and including the date 120 days after the date of the
Prospectus, the Company will not, without the prior written consent of the
Representatives, offer, pledge, issue, sell, contract to sell, grant any
option for the sale of, or otherwise dispose of (or announce any offer,
pledge, sale, grant of an option to purchase or other disposition),
directly or indirectly, any shares of Common Stock or securities
convertible into, exercisable or exchangeable for, shares of Common Stock,
except as provided in Section 2, except for (A) the grant of stock options
and restricted stock under existing stock option and restricted stock plans
of the Company, (B) the issuance of Common Stock upon the exercise of stock
options or warrants outstanding on the date of this Agreement to the extent
that such stock options or warrants are disclosed in the Prospectus and (C)
except pursuant to the conversion of the Company's 8% Convertible
Subordinated Debentures due 2005 as disclosed in the Prospectus.
(ix) During a period of five years from the effective date of the
Registration Statement, the Company will furnish to the Representatives
and, upon request, to each of the other Underwriters, without charge, (A)
copies of all reports or other communications (financial or other)
furnished to shareholders, and (B) as soon as they are available, copies of
any reports and financial statements furnished to or filed with the
Commission or any national securities exchange.
(x) Prior to the termination of the underwriting syndicate
contemplated by this Agreement, the Company will not, and will use its best
efforts to cause its officers, directors or affiliates not to (A) take,
directly or indirectly, any action designed to cause or to result in, or
that might reasonably be expected to constitute, the stabilization or
manipulation of the price of any
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security of the Company to facilitate the sale or resale of any of the
Shares or, (B) sell, or pay anyone any compensation for soliciting
purchases of, the Shares.
(xi) The Company will apply the net proceeds from the offering in
the manner set forth under "Use of Proceeds" in the Prospectus.
(xii) The Company will use its best efforts to cause the Shares to
be listed on the Nasdaq National Market at each Time of Delivery and will
use its best efforts to cause the Shares to be so listed for at least one
year from the date hereof.
(xiii) The Company will file promptly all reports and any
definitive proxy or information statements required to be filed by the
Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act subsequent to the date of the Prospectus and for so
long as the delivery of a prospectus is required in connection with the
offering, sale and distribution of the Shares.
(b) COVENANTS OF THE SELLING SHAREHOLDERS. Each Selling Shareholder
covenants and agrees with each of the Underwriters:
(i) During the period beginning from the date hereof and continuing
to and including the date 120 days after the date of the Prospectus, such
Selling Shareholder will not, without the prior written consent of the
Representatives, offer, pledge, sell, contract to sell, grant any option
for the sale of, or otherwise dispose of (or announce any offer, pledge,
sale, grant of an option to purchase or other disposition), directly or
indirectly, any shares of Common Stock (except with respect to shares of
Common Stock under the discretion and control of any investment manager
within the meaning of Section 3(38) of the Employee Retirement Income
Security Act of 1974, as amended) or securities convertible into,
exercisable or exchangeable for, shares of Common Stock, except as provided
in Section 2 and except pursuant to bona fide gifts to persons who agree in
writing to be bound by the terms of this covenant or pursuant to the laws
of descent and distribution.
(ii) Neither such Selling Shareholder (nor any of its officers,
directors or affiliates) will (A) take, directly or indirectly, prior to
the termination of the underwriting syndicate contemplated by this
Agreement, any action designed to cause or to result in, or that might
reasonably be expected to constitute, the stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale
of any of the Shares, (B) sell, bid for, purchase or pay anyone any
compensation for soliciting purchases of, the Shares, or (C) pay to or
agree to pay any person any compensation for soliciting another to purchase
any other securities of the Company.
6. EXPENSES. The Company and each of the Selling Shareholders will pay
all costs and expenses incident to the performance of their respective
obligations under this Agreement in such proportions as they agree among
themselves, whether or not the transactions contemplated hereby are consummated
or this Agreement is terminated pursuant to Section 10 hereof, including,
without limitation, all costs and expenses incident to (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation, printing and, if applicable, filing
of the Registration Statement (including all amendments thereto), any
Preliminary Prospectus, the Prospectus and any amendments and supplements
thereto, this Agreement and any blue sky memoranda; (ii) the delivery of copies
of the foregoing documents to the Underwriters; (iii) the filing fees of the
Commission and the National Association of Securities Dealers, Inc. relating to
the Shares; (iv) the preparation, issuance and delivery to the Underwriters of
any certificates evidencing the Shares, including transfer agent's and
registrar's fees; (v) the qualification of the Shares for offering and sale
under state securities and blue sky laws, including filing fees and reasonable
fees and disbursements of counsel for
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the Underwriters relating thereto; (vi) any listing of the Shares on the
Nasdaq National Market; and (vii) any expenses for travel, lodging and meals
incurred by the Company and any of its officers, directors and employees in
connection with any meetings with prospective investors in the Shares. It is
understood, however, that, except as provided in this Section, Section 8 and
Section 10 hereof, the Underwriters will pay all of their own costs and
expenses, including the fees of their counsel, stock transfer taxes on resale
of any of the Shares by them, and any advertising expenses relating to the
offer and sale of the Shares.
7. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS. The obligations of the
Underwriters hereunder to purchase and pay for the Shares to be delivered at
each Time of Delivery shall be subject, in their discretion, to the accuracy of
the representations and warranties of the Company and the Selling Shareholders
contained herein as of the date hereof and as of such Time of Delivery, to the
accuracy of the statements of Company officers made pursuant to the provisions
hereof, to the performance by the Company and the Selling Shareholders of their
respective covenants and agreements hereunder, and to the following additional
conditions precedent:
(a) If the registration statement as amended to date has not become
effective prior to the execution of this Agreement, such registration statement
shall have been declared effective not later than 5:00 p.m., Atlanta time, on
the date of this Agreement or such later date and/or time as shall have been
consented to by the Representatives in writing. The Prospectus and any
amendment or supplement thereto shall have been filed with the Commission
Pursuant to Rule 424(b) within the applicable time period prescribed for such
filing and in accordance with Section 5(a) of this Agreement; no stop order
suspending the effectiveness of the Registration Statement or any part thereof
shall have been issued and no proceedings for that purpose shall have been
instituted, overtly threatened or, to the knowledge of the Company and the
Representatives, contemplated by the Commission; and all requests for additional
information on the part of the Commission shall have been complied with to your
reasonable satisfaction.
(b) Smith, Gambrell & Russell, LLP, counsel for the Underwriters,
shall have furnished to the Representatives such opinion or opinions, dated such
Time of Delivery, with respect to the incorporation of the Company, the validity
of the Shares being delivered at such Time of Delivery, the Registration
Statement, the Prospectus, and other related matters as you may reasonably
request, and the Company shall have furnished to such counsel such documents as
they reasonably request for the purpose of enabling them to pass upon such
matters.
(c) The Representatives shall have received an opinion, dated such
Time of Delivery, of Haynes and Boone, LLP, counsel for the Company, in form and
substance satisfactory to the Representatives and their counsel, to the effect
that:
(i) The Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the State of Delaware
and has the corporate power and authority to own or lease its properties
and conduct its business as described in the Prospectus. The Company is
duly qualified to transact business as a foreign corporation and is in good
standing under the laws of each other jurisdiction set forth on a schedule
attached to such opinion.
(ii) Each of the Material Subsidiaries has been duly
incorporated, is validly existing as a corporation in good standing under
the laws of its jurisdiction of incorporation and has the corporate power
and authority to own or lease its properties and conduct its business as
described in the Prospectus. Each of the Material Subsidiaries of the
Company is duly qualified to transact business as a foreign corporation
and is in good standing under the laws of each other jurisdiction set forth
on a schedule attached to such opinion
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(iii) The Company's authorized, issued and outstanding capital
stock is as disclosed in the Prospectus. All of the issued shares of
capital stock of the Company (including the Shares to be sold by the
Selling Shareholders) have been duly authorized and validly issued, are
fully paid and nonassessable, and conform in all material respects to the
description of the Common Stock contained in the Prospectus under the
caption "Description of Capital Stock." To such counsel's actual knowledge,
none of the issued shares of capital stock of the Company, its predecessors
or the Material Subsidiaries has been issued in violation of any preemptive
rights of shareholders, and no person or entity (including any holder of
outstanding shares of capital stock of the Company) has any preemptive or,
to the actual knowledge of such counsel, other rights to subscribe for any
of the Shares.
(iv) All of the shares of capital stock of each of the Material
Subsidiaries have been duly authorized and validly issued, are fully paid
and nonassessable, and, to such counsel's actual knowledge, are owned of
record by the Company, directly or indirectly, and the Company has not
received notice of any adverse claims, except for security interests in the
capital stock of a majority of the Material Subsidiaries granted by the
Company pursuant to the Revolving Loan Agreement.
(v) To such counsel's actual knowledge and except as disclosed
in the Prospectus, there are no outstanding (A) securities or obligations
of the Company or any of its subsidiaries convertible into or exchangeable
for any capital stock of the Company or any such subsidiary, (B) warrants,
rights or options to subscribe for or purchase from the Company or any such
subsidiary any such capital stock or any such convertible or exchangeable
securities or obligations, or (C) obligations of the Company or any such
subsidiary to issue any shares of capital stock, any such convertible or
exchangeable securities or obligations, or any such warrants, rights or
options.
(vi) The Shares to be issued and sold by the Company have been
duly authorized and, when issued and delivered to the Underwriters against
payment therefor as provided herein, will be validly issued and fully paid
and nonassessable and will conform in all material respects to the
description of the Common Stock contained in the Prospectus; the form of
certificate evidencing the Shares complies with all applicable requirements
of the Delaware General Corporation Law; and the Shares to be issued and
sold by the Company have been listed on the Nasdaq National Market System.
(vii) To the actual knowledge of such counsel, except as
disclosed in the Prospectus, there are no contracts, agreements or
understandings between the Company and any person granting such person
the right to require the Company to file a registration statement under
the Act with respect to any securities of the Company owned or to be owned
by such person or to require the Company to include such securities in the
Shares registered pursuant to the Registration Statement (or any such right
has been effectively waived) or in any securities being registered pursuant
to any other registration statement filed by the Company under the Act.
(viii) Each sale by the Company of the Company's capital stock
during the period from December 13, 1993 through each Time of Delivery was,
at the time of each such sale, issued pursuant to a registration statement
effective under the Act or exempt from the registration requirements of
the Act.
(ix) Execution and delivery by the Company of, and performance
of its obligations in, this Agreement do not (i) violate the Company's
Certificate of Incorporation or Bylaws, (ii) breach, or result in a default
under, any instrument which has been filed by the Company as an exhibit to
its most recent Annual Report on Form 10-K or any interim Quarterly Report
on Form 10-Q, or (iii) breach or otherwise violate applicable provisions of
any statutory law or regulation or any order,
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judgment or decree of any court or governmental agency or body having
jurisdiction over the Company or any of its Material Subsidiaries or any
of their respective properties and which is known to such counsel, and,
as to clauses (ii) and (iii), where any such breach or violation would
have a material adverse effect on the financial position of the Company and
its subsidiaries, taken as a whole.
(x) Except for permits and similar authorizations required
under the Act and the blue sky laws of certain jurisdictions and for
permits and authorizations which have been obtained and registrations which
have been effected, no consent, approval, authorization, registration or
order of any court or governmental agency or body is required in connection
with the sale of the Shares to be issued and sold by the Company.
(xi) To such counsel's actual knowledge, neither the Company
nor any of the Material Subsidiaries is named as a party to any pending or
overtly threatened litigation, arbitration, claim or proceeding that is
material to the Company and its subsidiaries taken as a whole, except as
disclosed on the Company Defensive Litigation/Counterclaim Report for the
Third Quarter 1996.
(xii) This Agreement has been duly authorized, executed and
delivered by the Company.
(xiii) The Registration Statement and the Prospectus and each
amendment or supplement thereto (other than the financial statements and
related schedules therein, as to which such counsel need express no
opinion), as of their respective effective or issue dates, complied as to
form in all material respects with the applicable requirements of the Act
and the Exchange Act and the respective rules and regulations thereunder.
The statements contained in the Prospectus under the captions "Quality
Acquisition," "Management's Discussion and Analysis of Financial Condition
and Results of Operations - Liquidity and Capital Resources" and
"Description of Capital Stock," insofar as they purport to summarize the
provisions of statutes, legal and governmental proceedings or contracts and
other documents, are materially accurate and fairly present in all material
respects the information required to be shown.
(xiv) The Company's reports on Form 10-K, Form 10-Q and Form 8-K
incorporated by reference in the Prospectus (other than the financial
statements and related schedules therein, as to which such counsel need
express no opinion), when they were filed with the Commission complied as
to form in all material respects with the requirements of the Exchange Act,
and the rules and regulations of the Commission thereunder.
(xv) To such counsel's actual knowledge, the conditions for use
of Form S-3 have been satisfied with respect to the Registration Statement.
(xvi) The Registration Statement is effective under the Act; any
required filing of the Prospectus pursuant to Rule 424(b) has been made in
the manner and within the time period required by Rule 424(b); to such
counsel's actual knowledge, (i) no stop order suspending the effectiveness
of the Registration Statement or any part thereof has been issued and (ii)
no proceedings for that purpose have been instituted or threatened or are
contemplated by the Commission.
(xvii) The Company is not, and immediately after the consummation
of the Offering in accordance with this Agreement will not be, required to
be registered under the Investment Company Act of 1940, as amended, as an
"investment company" and, to the actual knowledge of such counsel is not a
company "controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
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Such counsel shall also state that, although they do not assume any
responsibility for, and cannot guarantee the accuracy, completeness or fairness
of, the statements contained in the Registration Statement or the Prospectus, on
the basis of information developed during the course of the Primary Lawyer
Group's (as defined in the Accord (as defined below)) representation of the
Company and based upon their participation in the preparation of the
Registration Statement, which involved attending conferences with officers of
the Company, the Company's accountants and other parties, but otherwise without
independent check or verification except as specified, they have no reason to
believe that the Registration Statement, or any further amendment thereto made
prior to such Time of Delivery, on its effective date and as of such Time of
Delivery, contained or contains any untrue statement of a material fact or
omitted or omits to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, or that the Prospectus,
or any amendment or supplement thereto made prior to such Time of Delivery, as
of its issue date and as of such Time of Delivery, contained or contains any
untrue statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading (provided that such counsel need
express no belief regarding the financial statements and related schedules and
other financial or statistical data or other scheduled data contained or
incorporated by reference in the Registration Statement, any amendment thereto,
or the Prospectus, or any amendment or supplement thereto).
In rendering any such opinion, such counsel may rely, as to matters of
fact, to the extent such counsel deem proper, on certificates of responsible
officers of the Company and public officials. In addition, such opinion shall
state that it is governed by and shall be interpreted in accordance with the
Legal Opinion Accord of the ABA Section of Business Law (1991) (the "Accord"),
PROVIDED THAT the incorporation in such opinion of the Accord shall not include
an incorporation of the exclusion contained in Section 19(a) of the Accord
(insofar as such exclusion relates to federal securities laws).
(d) The Representatives shall have received an opinion, dated such Time
of Delivery, of L. Keith Blackwell, General Counsel for the Company, in form and
substance satisfactory to the Representatives and their counsel, to the effect
that:
(i) The Company is duly qualified to transact business as a foreign
corporation and is in good standing under the laws of each other
jurisdiction in which it owns or leases material property, or conducts
material business, so as to require such qualification, except where
the failure to so qualify would not have a material adverse effect on
the financial position of the Company and its subsidiaries, taken as a
whole.
(ii) Each of the subsidiaries of the Company is duly qualified to
transact business as a foreign corporation and is in good standing
under the laws of each other jurisdiction in which it owns or leases
material property, or conducts material business, so as to require such
qualification, except where the failure to so qualify would not have a
material adverse effect on the financial position of the Company and
its subsidiaries, taken as a whole.
(iii) Each sale of the Company's capital stock during the period
from December 13, 1993 through each Time of Delivery was, at the time
of each such sale, issued pursuant to a registration statement
effective under the Act or exempt from the registration requirements
of the Act and applicable state securities or blue sky laws.
(iv) To such counsel's actual knowledge, neither the Company nor any
of the Material Subsidiaries has (A) breached or otherwise violated any
existing obligation of the Company under any court order that names the
Company as a party, or (B) violated applicable provisions of statutory
law or regulation, in either case where any such breach or violation
would have a
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<PAGE>
material adverse effect on the financial position of the Company and its
subsidiaries, taken as a whole.
(v) To such counsel's actual knowledge, (A) neither the Company nor
any of the Material Subsidiaries has violated its respective Articles
or Certificate of Incorporation or Bylaws and (B) neither the Company
nor any of the Material Subsidiaries has breached or otherwise violated
any existing obligation under any material agreement to which the
Company or any of the Material Subsidiaries is a party, in either case
where any such breach or violation would have a material adverse effect
on the financial position of the Company and its subsidiaries, taken as
a whole.
Such counsel shall also state that during the course of his representation
of the Company and based upon his participation in the preparation of the
Registration Statement, he has no reason to believe that the Registration
Statement, or any further amendment thereto made prior to such Time of Delivery,
on its effective date and as of such Time of Delivery, contained or contains any
untrue statement of a material fact or omitted or omits to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading, or that the Prospectus, or any amendment or supplement thereto
made prior to such Time of Delivery, as of its issue date and as of such Time of
Delivery, contained or contains any untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading (provided that such counsel need express no belief regarding the
financial statements and related schedules and other financial or statistical
data or other scheduled data contained or incorporated by reference in the
Registration Statement, any amendment thereto, or the Prospectus, or any
amendment or supplement thereto).
(e) The Representatives shall have received an opinion, dated such
Time of Delivery, of Alston & Bird, counsel for the Individual Selling
Shareholders in form and substance satisfactory to the Representatives and their
counsel, to the effect that:
(i) Each of the Individual Selling Shareholders has full right,
power and authority to enter into this Agreement, the Power of Attorney and
the Custody Agreement and to sell, assign, transfer and deliver to the
Underwriters the Shares to be sold by such Individual Selling Shareholder
hereunder and the execution and delivery of this Agreement, the Power of
Attorney and the Custody Agreement have been duly authorized by all
necessary action of such Individual Selling Shareholder.
(ii) This Agreement, a Power of Attorney and a Custody Agreement
have been duly executed and delivered by such Individual Selling
Shareholder, each of which is enforceable against such Individual Selling
Shareholder in accordance with its terms subject, as to enforcement, to
applicable bankruptcy, insolvency, fraudulent transfer, reorganization and
moratorium laws and other laws relating to or affecting the enforcement of
creditors' rights generally and to general equitable principles (except
that the right to indemnity and contribution may be limited by federal or
state securities laws) (provided that such counsel need express no opinion
regarding the irrevocability of the Power of Attorney and Custody
Agreement).
(iii) The sale of the Shares to be sold by such Individual Selling
Shareholder at such Time of Delivery and the performance of this Agreement,
the Power of Attorney and the Custody Agreement and the consummation of the
transactions herein and therein contemplated will not conflict with, or
(with or without the giving of notice or the passage of time or both)
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any material indenture, mortgage, deed of
trust, loan agreement, lease or other material agreement or instrument
known to such counsel to which such Individual Selling Shareholder is a
party or to which any of such Individual Selling Shareholder's properties
or assets is subject, nor will such action conflict with
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or violate any provision of the Articles of Incorporation or Bylaws or
other governing instruments of such Selling Shareholder or any statute,
rule or regulation or any order, judgment or decree of any court or
governmental agency or body having jurisdiction over such Individual
Selling Shareholder or any of such Individual Selling Shareholder's
properties or assets.
(iv) No consent, approval, authorization, order or declaration of or
from, or registration, qualification or filing with, any court or
governmental agency or body is required for the issue and sale of the
Shares being sold by such Individual Selling Shareholder or the
consummation of the transactions contemplated by this Agreement, the Power
of Attorney or the Custody Agreement, except the registration of such
Shares under the Act and such as may be required under state securities or
blue sky laws in connection with the offer, sale and distribution of such
Shares by the Underwriters.
(v) Upon delivery to the Underwriters, good and valid title to the
Shares to be sold by such Individual Selling Shareholder hereunder, free
and clear of all liens, encumbrances, equities, claims, restrictions,
security interests, voting trusts or other defects of title whatsoever,
will have been transferred to the Underwriters (whom such counsel may
assume to be bona fide purchasers) who have purchased Shares hereunder. To
the best of such counsel's knowledge, there are no such liens,
encumbrances, equities, claims, restrictions, security interests, voting
trusts or other defects of title.
In rendering any such opinion, such counsel may rely, as to matters of
fact, to the extent such counsel deem proper, on certificates of responsible
officers of the Company, the Individual Selling Shareholders and public
officials, provided that such counsel shall state that they believe that both
the Representative and such counsel are justified in relying on such
certificate.
(f) The Representatives shall have received an opinion, dated such
Time of Delivery, of counsel designated for each Corporate Selling Shareholder
on Schedule III hereto in form and substance satisfactory to the Representatives
and their counsel, with such changes and modifications as shall be mutually
acceptable, to the effect that:
(i) Such Corporate Selling Shareholder has full right, power
(corporate and other) and authority to enter into this Agreement, the Power
of Attorney and the Custody Agreement and to sell, assign, transfer and
deliver to the Underwriters the Shares to be sold by such Corporate Selling
Shareholder hereunder and the execution and delivery of this Agreement, the
Power of Attorney and the Custody Agreement have been duly authorized by
all necessary action of such Corporate Selling Shareholder.
(ii) This Agreement, a Power of Attorney and a Custody Agreement
have been duly executed and delivered by such Corporate Selling
Shareholder, each of which is enforceable against such Corporate Selling
Shareholder in accordance with its terms subject, as to enforcement, to
applicable bankruptcy, insolvency, fraudulent transfer, reorganization and
moratorium laws and other laws relating to or affecting the enforcement of
creditors' rights generally and to general equitable principles (except
that the right to indemnity and contribution may be limited by federal or
state securities laws) (provided that such counsel need express no opinion
regarding the irrevocability of the Power of Attorney and Custody
Agreement).
(iii) The sale of the Shares to be sold by such Corporate Selling
Shareholder at such Time of Delivery and the performance of this Agreement,
the Power of Attorney and the Custody Agreement and the consummation of the
transactions herein and therein contemplated will not conflict with, or
(with or without the giving of notice or the passage of time or both)
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any material
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indenture, mortgage, deed of trust, loan agreement, lease or other
material agreement or instrument known to such counsel to which such
Corporate Selling Shareholder is a party or to which any of such
Corporate Selling Shareholder's properties or assets is subject, nor
will such action conflict with or violate any provision of the Articles
of Incorporation or Bylaws or other governing instruments of such
Selling Shareholder or any statute, rule or regulation or any order,
judgment or decree of any court or governmental agency or body having
jurisdiction over such Corporate Selling Shareholder or any of such
Corporate Selling Shareholder's properties or assets.
(iv) No consent, approval, authorization, order or declaration of or
from, or registration, qualification or filing with, any court or
governmental agency or body is required for the issue and sale of the
Shares being sold by such Corporate Selling Shareholder or the consummation
of the transactions contemplated by this Agreement, the Power of Attorney
or the Custody Agreement, except the registration of such Shares under the
Act and such as may be required under state securities or blue sky laws in
connection with the offer, sale and distribution of such Shares by the
Underwriters.
(v) Upon delivery to the Underwriters, good and valid title to the
Shares to be sold by such Corporate Selling Shareholder hereunder, free and
clear of all liens, encumbrances, equities, claims, restrictions, security
interests, voting trusts or other defects of title whatsoever, will have
been transferred to the Underwriters (whom such counsel may assume to be
bona fide purchasers) who have purchased Shares hereunder. To such
counsel's knowledge, there are no such liens, encumbrances, equities,
claims, restrictions, security interests, voting trusts or other defects of
title.
In rendering any such opinion, such counsel may rely, as to matters of
fact, to the extent such counsel deem proper, on certificates of responsible
officers of the Company, the Corporate Selling Shareholders and public
officials, provided that such counsel shall state that they believe that both
the Representatives and such counsel are justified in relying on such
certificate.
(g) The Representatives shall have received from Deloitte & Touche
LLP letters dated, respectively, the day before the date hereof (or, if the
Registration Statement has been declared effective prior to the execution and
delivery of this Agreement, dated such effective date and the date of this
Agreement) and each Time of Delivery, in form and substance satisfactory to the
Representatives, to the effect set forth in Annex I hereto. In the event that
the letters referred to in this Section 7(g) set forth any changes, decreases or
increases in the items specified in paragraph (v) of Annex I, it shall be a
further condition to the obligations of the Underwriters that (i) such letters
shall be accompanied by a written explanation by the Company as to the
significance thereof, unless the Representatives deem such explanation
unnecessary, and (ii) such changes, decreases or increases do not, in the sole
judgment of the Representatives, make it impracticable or inadvisable to proceed
with the purchase, sale and delivery of the Shares being delivered at such Time
of Delivery as contemplated by the Registration Statement, as amended as of the
date of such letter.
(h) The Representatives shall have received from Coopers & Lybrand LLP
letters dated, respectively, the day before the date hereof (or, if the
Registration Statement has been declared effective prior to the execution and
delivery of this Agreement, dated such effective date and the date of this
Agreement) and each Time of Delivery, in form and substance satisfactory to the
Representatives, to the effect set forth in Annex II hereto. In the event that
the letters referred to in this Section 7(h) set forth any changes, decreases or
increases in the items specified in paragraph (v) of Annex I, it shall be a
further condition to the obligations of the Underwriters that (i) such letters
shall be accompanied by a written explanation by the Company as to the
significance thereof, unless the Representatives deem such explanation
unnecessary, and (ii) such changes, decreases or increases do not, in the sole
judgment of the Representatives, make it impracticable or inadvisable to proceed
with the purchase, sale and delivery of the Shares being delivered at such Time
of Delivery as contemplated by the Registration Statement, as amended as of the
date of such letter.
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(i) Since the date of the latest audited financial statements included
in the Prospectus, neither the Company nor any of its subsidiaries shall have
sustained (i) any loss or interference with their respective businesses from
fire, explosion, flood, hurricane or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order or
decree, otherwise than as disclosed in or contemplated by the Prospectus, or
(ii) any change, or any development involving a prospective change (including
without limitation a change in management or control of the Company), in or
affecting the position (financial or otherwise), results of operations, net
worth or business prospects of the Company and its subsidiaries, otherwise than
as disclosed in or contemplated by the Prospectus, the effect of which, in
either such case, is in your judgment so material and adverse as to make it
impracticable or inadvisable to proceed with the purchase, sale and delivery
of the Shares being delivered at such Time of Delivery as contemplated by the
Registration Statement, as amended as of the date hereof.
(j) Subsequent to the date hereof there shall not have occurred any of
the following: (i) any suspension or limitation in trading in securities
generally on the New York Stock Exchange, or any setting of minimum prices for
trading on such exchange, or in the Common Stock by the Commission or the Nasdaq
National Market; (ii) a moratorium on commercial banking activities in New York
declared by either federal or state authorities; (iii) any downgrading in the
rating of any debt securities of the Company by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g) under
the Act), or any public announcement that any such organization has under
surveillance or review its rating of any debt securities of the Company (other
than an announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating); or (iv) any outbreak or
escalation of hostilities involving the United States, declaration by the United
States of a national emergency or war or any other national or international
calamity or emergency if the effect of any such event specified in this clause
(iv) in your judgment makes it impracticable or inadvisable to proceed with the
purchase, sale and delivery of the Shares being delivered at such Time of
Delivery as contemplated by the Registration Statement, as amended as of the
date hereof.
(k) The Company shall have furnished to the Representatives and the
Selling Shareholders at such Time of Delivery certificates of officers of the
Company and the Selling Shareholders shall have furnished to such parties
certificates of the Selling Shareholders, satisfactory to the Representatives,
as to the accuracy of the representations and warranties of the Company and such
Selling Shareholders respectively herein at and as of such Time of Delivery, as
to the performance by the Company and such Selling Shareholders of all of its
and their respective obligations hereunder to be performed at or prior to such
Time of Delivery, and as to such other matters as the Representatives may
reasonably request, and the Company shall have furnished or caused to be
furnished certificates as to the matters set forth in subsections (a) and (i) of
this Section 7, and as to such other matters as the Representatives may
reasonably request.
(l) The Shares shall be listed on the Nasdaq National Market.
8. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless each Underwriter
and Selling Shareholder against any losses, claims, damages or liabilities,
joint or several, to which such Underwriter or Selling Shareholder may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue statement made by the Company in
Section 1(a) of this Agreement; (ii) any untrue statement or alleged untrue
statement of any material fact contained in (A) the Registration Statement or
any amendment thereto, any Preliminary Prospectus or the Prospectus or any
amendment or supplement thereto, or (B) any application or other document, or
any amendment or supplement thereto, executed by the Company or based upon
written information furnished by or on behalf of the Company filed in any
jurisdiction in order to qualify the Shares under the securities or blue sky
laws thereof or filed with the Commission or any securities association or
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securities exchange (each an "Application"); or (iii) the omission or alleged
omission to state in the Registration Statement or any amendment thereto, any
Preliminary Prospectus, the Prospectus or any amendment or supplement thereto,
or any Application a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading, and will reimburse each Underwriter and Selling
Shareholder for any legal or other expenses reasonably incurred by such
Underwriter or Selling Shareholder in connection with investigating, defending
against or appearing as a third-party witness in connection with any such loss,
claim, damage, liability or action; PROVIDED, HOWEVER, that the Company shall
not be liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in the
Registration Statement or any amendment thereto, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto or any Application in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter or Selling Shareholder through the Representatives expressly for use
therein; PROVIDED FURTHER, HOWEVER, that the Company shall not be liable to any
Underwriter in respect of any Preliminary Prospectus to the extent that (i) the
Prospectus did not contain the untrue statement or alleged untrue statement or
omission or alleged omission giving rise to such loss, claim, damage, liability
or action, (ii) the Prospectus was not sent or given to the purchaser of the
Shares in question at or prior to the time at which the written confirmation of
the sale of such Shares was sent or given to such person, and (iii) the failure
to deliver such Prospectus was not the result of the Company's noncompliance
with its obligations under Sections 5(a)(ii) and 5(a)(vi) hereof. The Company
will not, without the prior written consent of each Underwriter and Selling
Shareholder, settle or compromise or consent to the entry of any judgment in any
pending or threatened claim, action, suit or proceeding (or related cause of
action or portion thereof) in respect of which indemnification may be sought
hereunder (whether or not such Underwriter or Selling Shareholder is a party to
such claim, action, suit or proceeding), unless such settlement, compromise or
consent includes an unconditional release of such Underwriter or Selling
Shareholder from all liability arising out of such claim, action, suit or
proceeding (or related cause of action or portion thereof).
(b) Each of the Selling Shareholders, severally (and not jointly)
agrees to indemnify and hold harmless the Company and each Underwriter against
any losses, claims, damages or liabilities, joint or several, to which the
Company or such Underwriter may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon: (i) any untrue statement or alleged
untrue statement made by such Selling Shareholder in Section 1(b) or 1(c) of
this Agreement; or (ii) with respect to the information contained under the
caption "Selling Stockholders" in the Registration Statement or any amendment
thereto, any Preliminary Prospectus or the Prospectus or any amendment or
supplement thereto, any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement or any amendment thereto,
any Preliminary Prospectus, the Prospectus or any amendment or supplement
thereto, or any Application (other than the incorrect designation of the name of
the Trustee of the Delta Master Trust as "Citibank N.A." rather than "Citibank
F.S.B.") or which arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading with respect to such
Selling Shareholder, and will reimburse the Company and each Underwriter for any
legal or other expenses reasonably incurred by the Company or such Underwriter
in connection with investigating, defending against or appearing as a third-
party witness in connection with any such loss, claim, damage, liability or
action; PROVIDED, HOWEVER, that no such Selling Shareholder shall be liable in
any such case to the extent that any such loss, claim, damage, liability or
action arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in the Registration Statement or
any amendment thereto, any Preliminary Prospectus, the Prospectus or any
amendment or supplement thereto or any Application in reliance upon and in
conformity with written information furnished to the Company by the Company or
any Underwriter through the Representatives expressly for use therein; PROVIDED
FURTHER, HOWEVER, that no Selling Shareholder shall be liable to the Company or
any Underwriter in respect of any Preliminary Prospectus to the extent that (i)
the Prospectus did not contain the untrue statement or alleged
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<PAGE>
untrue statement or omission or alleged omission giving rise to such loss,
claim, damage, liability or action, (ii) the Prospectus was not sent or given
to the purchaser of the Shares in question at or prior to the time at which
the written confirmation of sale of such Shares was sent or given to such
person, and (iii) the failure to deliver such Prospectus was not the result
of the Company's noncompliance with its obligations under Sections 5(a)(ii) and
5(a)(vi) hereof). No Selling Shareholder will, without the prior written
consent of the Company and the Representatives, settle or compromise or consent
to the entry of any judgment in any pending or threatened claim, action, suit
or proceeding (or related cause of action or portion thereof) in respect of
which indemnification may be sought hereunder (whether or not the Company or
such Underwriter is a party to such claim, action, suit or proceeding), unless
such settlement, compromise or consent includes an unconditional release of the
Company and such Underwriter from all liability arising out of such claim,
action, suit or proceeding (or related cause of action or portion thereof).
(c) Each Underwriter, severally but not jointly, agrees to indemnify
and hold harmless the Company and each Selling Shareholder against any losses,
claims, damages or liabilities to which the Company or any Selling Shareholder
may become subject under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement or any amendment thereto, the
Preliminary Prospectus or the Prospectus or any amendment or supplement thereto,
or any Application or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the
Representatives expressly for use therein; and will reimburse the Company and
each Selling Shareholder for any legal or other expenses reasonably incurred by
the Company or such Selling Shareholder in connection with investigating or
defending any such loss, claim, damage, liability or action.
(d) Promptly after receipt by an indemnified party under subsection
(a), (b) or (c) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection or unless the
indemnifying party is materially prejudiced by such omission. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, be counsel to the
indemnifying party); PROVIDED, HOWEVER, that if the defendants in any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be one or more
legal defenses available to it or other indemnified parties which are different
from or additional to those available to the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such action
on behalf of such indemnified party and such indemnified party shall have the
right to select separate counsel to defend such action on behalf of such
indemnified party. After such notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof and approval
by such indemnified party of counsel appointed to defend such action, the
indemnifying party will not be liable to such indemnified party under this
Section 8 for any legal or other expenses, other than reasonable costs of
investigation, subsequently incurred by such indemnified party in connection
with the defense thereof, unless (i) the indemnified party shall have employed
separate counsel in accordance with the proviso to the next preceding sentence
or (ii) the indemnifying party has authorized the employment of counsel for the
indemnified party at the expense of the indemnifying party or (iii) the
indemnifying party shall
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<PAGE>
have failed to assume the defense thereof. Nothing in this Section 8(d)
shall preclude an indemnified party from participating at its own expense in
the defense of any such action so assumed by the indemnifying party.
(e) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a), (b) or (c) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Selling Shareholders,
respectively on the one hand and the Underwriters on the other from the offering
of the Shares. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law, then each indemnifying
party shall contribute to such amount paid or payable by such indemnified party
in such proportion as is appropriate to reflect not only such relative benefits
but also the relative fault of the Company and the Selling Shareholders,
respectively on the one hand and the Underwriters on the other in connection
with the statements or omissions that resulted in such losses, claims, damages
or liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Selling Shareholders, respectively on the one hand and the Underwriters on the
other shall be deemed to be in the same proportion as the total net proceeds
from the offering (before deducting expenses) received by the Company and the
Selling Shareholders, respectively bear to the total underwriting discounts and
commissions received by the Underwriters. The relative fault 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 the Selling
Shareholders on the one hand or the Underwriters on the other and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company, the Selling Shareholders and
the Underwriters agree that it would not be just and equitable if contributions
pursuant to this subsection (e) were determined by pro rata allocation (even if
the Underwriters were treated as one entity for such purpose) or by any other
method of allocation which does not take account of the equitable considerations
referred to above in this subsection (e). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subsection (e) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this subsection (e), no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Shares underwritten by it and distributed to the public
were offered 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 in this subsection
(e) to contribute are several in proportion to their respective underwriting
obligations and not joint.
(f) The obligations of the Company and the Selling Shareholders under
this Section 8 are several and not joint and shall be in addition to any
liability which the Company or such Selling Shareholders may otherwise have and
shall extend, upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Act; and the obligations of
the Underwriters under this Section 8 shall be in addition to any liability
which the respective Underwriters may otherwise have and shall extend, upon the
same terms and conditions, to each officer and director of the Company and any
Selling Shareholder and to each person, if any, who controls the Company or any
Selling Shareholder within the meaning of the Act. Notwithstanding the
foregoing, the liability of each Selling Shareholder to the Underwriters arising
on account of the offering, whether such liability arises under this Agreement
or otherwise, shall not exceed the amount set forth in Section 8(g) of this
Agreement.
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<PAGE>
(g) Notwithstanding anything to the contrary in this Section 8, the
liability of each Selling Shareholder for indemnification and contribution under
this Section 8 shall be limited to an amount equal to the net proceeds received
by such Selling Shareholder from the Underwriters in the offering.
9. DEFAULT OF UNDERWRITERS.
(a) If any Underwriter defaults in its obligation to purchase Shares
at a Time of Delivery, the Representatives may in their discretion arrange for
the Representatives or another party or other parties to purchase such Shares on
the terms contained herein. If within thirty-six (36) hours after such default
by any Underwriter the Representatives do not arrange for the purchase of such
Shares, the Company and the Selling Shareholders shall be entitled to a further
period of thirty-six (36) hours within which to procure another party or other
parties satisfactory to the Representatives to purchase such Shares on such
terms. In the event that, within the respective prescribed periods, the
Representatives notify the Company and the Selling Shareholders that the
Representatives have so arranged for the purchase of such Shares, or the Company
and the Selling Shareholders notify the Representatives that they have so
arranged for the purchase of such Shares, the Representatives or the Company and
the Selling Shareholders shall have the right to postpone a Time of Delivery for
a period of not more than seven days in order to effect whatever changes may
thereby be made necessary in the Registration Statement or the Prospectus, or in
any other documents or arrangements, and the Company agrees to file promptly any
amendments to the Registration Statement or the Prospectus that in the opinion
of the Representatives may thereby be made necessary. The cost of preparing,
printing and filing any such amendments shall be paid for by the Underwriters.
The term "Underwriter" as used in this Agreement shall include any person
substituted under this Section with like effect as if such person had originally
been a party to this Agreement with respect to such Shares. The thirty-six (36)
hour periods referred to in this subsection (a) shall not include the hours
between (i) 5:00 p.m., Atlanta time, on any Friday through 9:00 a.m. Atlanta
time, the following Monday or (ii) 5:00 p.m., Atlanta time, on the day preceding
a day on which the New York Stock Exchange is closed for trading (a "holiday")
through 9:00 a.m., Atlanta time, on the day following that holiday.
(b) If, after giving effect to any arrangements for the purchase of
the Shares of a defaulting Underwriter or Underwriters by the Representatives
and the Company and the Selling Shareholders as provided in subsection (a)
above, the aggregate number of such Shares which remains unpurchased does not
exceed one-eleventh of the aggregate number of Shares to be purchased at such
Time of Delivery, then the Company and the Selling Shareholders shall have the
right to require each non-defaulting Underwriter to purchase the number of
Shares which such Underwriter agreed to purchase hereunder at such Time of
Delivery and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Shares which such
Underwriter agreed to purchase hereunder) of the Shares of such defaulting
Underwriter or Underwriters for which such arrangements have not been made, but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
10. TERMINATION.
(a) This Agreement may be terminated with respect to the Firm Shares
or any Optional Shares in the sole discretion of the Representatives by notice
to the Company given prior to the First Time of Delivery or any Subsequent Time
of Delivery, respectively, in the event that (i) any condition to the
obligations of the Underwriters set forth in Section 7 hereof has not been
satisfied, or (ii) the Company or the Selling Shareholders shall have failed,
refused or been unable to deliver the Shares or to perform all obligations and
satisfy all conditions on their respective parts to be performed or satisfied
hereunder at or prior to such Time of Delivery, in either case other than by
reason of a default by any of the Underwriters. If this Agreement is terminated
pursuant to this Section 10(a), the Company and the Selling Shareholders, pro
rata in accordance with the number of Shares proposed to be sold hereunder will
reimburse the Underwriters severally upon demand for all out-of-pocket expenses
(including counsel fees and
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<PAGE>
disbursements) that shall have been incurred by them in connection with the
proposed purchase and sale of the Shares. Neither the Company nor any
Selling Shareholder shall in any event be liable to any of the Underwriters
for the loss of anticipated profits from the transactions covered by this
Agreement.
(b) If, after giving effect to any arrangements for the purchase of
the Shares of a defaulting Underwriter or Underwriters by you and the Company
and the Selling Shareholders as provided in Section 9(a), the aggregate number
of such Shares which remains unpurchased exceeds one-eleventh of the aggregate
number of Shares to be purchased at such Time of Delivery, or if the Company and
the Selling Shareholders shall not exercise the right described in Section 9(b)
to require non-defaulting Underwriters to purchase Shares of a defaulting
Underwriter or Underwriters, then this Agreement (or, with respect to a
Subsequent Time of Delivery, the obligations of the Underwriters to purchase and
of the Company to sell the Optional Shares) shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter, the Company or the
Selling Shareholders, except for the expenses to be borne by the Company, the
Selling Shareholders and the Underwriters as provided in Section 6 hereof and
the indemnity and contribution agreements in Section 8 hereof; but nothing
herein shall relieve a defaulting Underwriter from liability for its default.
11. SURVIVAL. The respective indemnities, agreements, representations,
warranties and other statements of the Company, its officers, the Selling
Shareholders and the several Underwriters, as set forth in this Agreement or
made by or on behalf of them, respectively, pursuant to this Agreement, shall
remain in full force and effect, regardless of any investigation (or any
statement as to the results thereof) made by or on behalf of any Underwriter or
any controlling person referred to in Section 8(e) or the Company, any Selling
Shareholder or any officer or director or controlling person of the Company or
any Selling Shareholder referred to in Section 8(e), and shall survive delivery
of and payment for the Shares. The respective agreements, covenants,
indemnities and other statements set forth in Sections 6 and 8 hereof shall
remain in full force and effect, regardless of any termination or cancellation
of this Agreement.
12. NOTICES. All communications hereunder shall be in writing and, if
sent to any of the Underwriters, shall be mailed, delivered or telegraphed and
confirmed in writing to you in care of The Robinson-Humphrey Company, Inc., 3333
Peachtree Road, N.E., Atlanta, Georgia 30326, Attention: Corporate Finance
Department (with a copy to Smith, Gambrell & Russell, LLP, 3343 Peachtree Road,
Atlanta, Georgia 30326, Attention: Robert C. Schwartz); if to any Selling
Shareholder shall be sufficient in all respects if delivered or sent by
registered mail to counsel for such Selling Shareholder at its address set forth
in Schedule II or Schedule III hereto; and if sent to the Company, shall be
mailed, delivered or telegraphed and confirmed in writing to the Company at
AMRESCO, Inc., 700 North Pearl Street, Suite 2400, Dallas, Texas 75201,
Attention: Robert H. Lutz, Jr., with a copy to the General Counsel of the
Company.
13. REPRESENTATIVES. The Representatives will act for the several
Underwriters in connection with the transactions contemplated by this Agreement,
and any action under this Agreement taken by you jointly or by The Robinson-
Humphrey Company, Inc. will be binding upon all the Underwriters.
14. BINDING EFFECT. This Agreement shall be binding upon, and inure
solely to the benefit of, the Underwriters, the Company and the Selling
Shareholders and to the extent provided in Sections 8 and 10 hereof, the
officers and directors and controlling persons referred to therein and their
respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement. No purchaser of any of the Shares from any Underwriter shall be
deemed a successor or assign by reason merely of such purchase.
15. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Georgia without giving effect to any
provisions regarding conflict of laws.
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<PAGE>
16. COUNTERPARTS. This Agreement may be executed by any one or more of
the parties hereto in any number of counterparts, each of which shall be deemed
to be an original, but all such counterparts shall together constitute one and
the same instrument.
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us one of the counterparts hereof, and upon the
acceptance hereof by The Robinson-Humphrey Company, Inc., on behalf of each of
the Underwriters, this letter will constitute a binding agreement among the
Underwriters and the Company. It is understood that your acceptance of this
letter on behalf of each of the Underwriters is pursuant to the authority set
forth in the Master Agreement among Underwriters, a copy of which shall be
submitted to the Company for examination, upon request, but without warranty on
your part as to the authority of the signers thereof.
Very truly yours,
AMRESCO, INC.
By: /s/ Robert H. Lutz, Jr.
------------------------------------
Name: Robert H. Lutz, Jr.
Title: Chairman and Chief Executive Officer
[Signatures Continued on Next Page]
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<PAGE>
SELLING SHAREHOLDERS
Angela Z. Allen IRA
John Gregory Berylson
Donald W. Burton
Frankel, Hardwick, Tanenbaum & Fink
Larence Park
Jack M. Berdy
Crandall C. Bowles
Collins Family Partnership
Willard W. Geiger
Frances C. Hart
Donald R. Landgraf Trust
Terri A. Mallory
PGF&M Venture 89
SQ Concepts
Brooks Schoen
Charles C. Schoen, III
G. Bickley Stevens, II
Wallace P. Whitley
Stanley C. Weiss
Citibank F.S.B. as Trustee of the Delta
Master Trust
National Life Insurance Company
BellSouth Master Pension Trust
Landmark Equity Partners III, L.P.
Ontario Municipal Employees Retirement
Board
Palmer & Cay/Carswell, Inc.
Richard L. Cravey
William L. Davies
William S. Green
Bart A. McLean
Edwin A. Whalen, Jr.
LeSelect WSG/DGG Interests L.P.
By: /s/ Richard L. Cravey
---------------------------------------------
Richard L. Cravey, Attorney-in-Fact acting on
behalf of each of the Selling Shareholders named
in Schedule II and Schedule III to this Agreement
[Signatures Continued on Next Page]
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<PAGE>
The foregoing Agreement is hereby confirmed
and accepted as of the date first written above
at Atlanta, Georgia.
THE ROBINSON-HUMPHREY COMPANY, INC.
PIPER JAFFRAY INC.
RAYMOND JAMES & ASSOCIATES, INC.
MONTGOMERY SECURITIES
J.C. BRADFORD & CO.
MORGAN KEEGAN & COMPANY, INC.
BY: THE ROBINSON-HUMPHREY COMPANY, INC.
By: /s/ Gerard J. O'Meara, Jr.
------------------------------------
(Authorized Representative)
On behalf of each of the Underwriters
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<PAGE>
SCHEDULE I
Number of
Optional
Total Shares to be
Number of Firm Purchased if
Shares to be Maximum Option
Underwriter Purchased Exercised
----------- -------------- --------------
The Robinson-Humphrey Company, Inc.. . . 1,100,000 165,000
Piper Jaffray Inc. . . . . . . . . . . . 1,100,000 165,000
Raymond James & Associates, Inc. . . . . 1,100,000 165,000
Montgomery Securities. . . . . . . . . . 1,100,000 165,000
J.C. Bradford & Co.. . . . . . . . . . . 1,100,000 165,000
Morgan Keegan & Company, Inc.. . . . . . 1,100,000 165,000
Alex. Brown & Sons Incorporated. . . . . 232,000 34,800
Prudential Securities Incorporated . . . 232,000 34,800
Cleary, Gull, Reiland & McDevitt Inc.. . 232,000 34,800
First Southwest Company. . . . . . . . . 232,000 34,800
Southwest Securities, Inc. . . . . . . . 232,000 34,800
--------- ---------
Total 7,760,000 1,164,000
--------- ---------
--------- ---------
<PAGE>
SCHEDULE II
Total
Number of Firm
Shares to be
Individual Selling Shareholders(l) Purchased
- ---------------------------------- --------------
Angela Z. Allen IRA. . . . . . . . . . . . . . . . . . 3,469
John Gregory Berylson. . . . . . . . . . . . . . . . . 3,468
Donald W. Burton . . . . . . . . . . . . . . . . . . . 1,155
SQ Concepts. . . . . . . . . . . . . . . . . . . . . . 4,624
Larence Park . . . . . . . . . . . . . . . . . . . . . 6,937
Jack M. Berdy. . . . . . . . . . . . . . . . . . . . . 13,873
Crandall C. Bowles . . . . . . . . . . . . . . . . . . 9,248
Collins Family Partnership . . . . . . . . . . . . . . 6,936
Willard W. Geiger. . . . . . . . . . . . . . . . . . . 6,937
Frances C. Hart. . . . . . . . . . . . . . . . . . . . 9,248
Donald R. Landgraf Trust . . . . . . . . . . . . . . . 3,468
Terri A. Mallory . . . . . . . . . . . . . . . . . . . 5,781
Brooks Schoen. . . . . . . . . . . . . . . . . . . . . 2,311
Charles C. Schoen, III . . . . . . . . . . . . . . . . 3,468
G. Bickley Stevens, II . . . . . . . . . . . . . . . . 578
Wallace P. Whitley . . . . . . . . . . . . . . . . . . 11,562
Stanley C. Weiss, Trustee of the
Stanley C. Weiss Trust. . . . . . . . . . . . . . . . 1,155
Richard L. Cravey. . . . . . . . . . . . . . . . . . . 266,080
William A. Davies. . . . . . . . . . . . . . . . . . . 9,251
William S. Green . . . . . . . . . . . . . . . . . . . 235,253
Bart A. McLean . . . . . . . . . . . . . . . . . . . . 4,626
Edwin A. Wahlen, Jr. . . . . . . . . . . . . . . . . . 266,080
LeSelect WSG/DGG Interests, L.P. . . . . . . . . . . . 30,828
-------
Total . . . . . . . . . . . . . . . . . 906,336
-------
-------
_________________________
(1) Each of the Individual Selling Shareholders has executed and delivered
a Power of Attorney appointing William A. Davies and Richard L.
Cravey, such Selling Shareholder's Attorneys-in-Fact and is
represented by Alston & Bird, One Atlantic Center, 1201 West Peachtree
Street, Atlanta, Georgia 30309-3424, Attention: Sidney J. Nurkin,
Esq.
<PAGE>
SCHEDULE III
Total
Number of Firm
Shares to
Corporate Selling Shareholders(l) Purchased
- --------------------------------- --------------
PGF&M Venture 89(2). . . . . . . . . . . . . . . . . . 4,626
Citibank F.S.B. as Trustee of the Delta
Master Trust(3). . . . . . . . . . . . . . . . . . . 462,422
National Life Insurance Company(4) . . . . . . . . . . 92,485
BellSouth Master Pension Trust(5). . . . . . . . . . . 3,069,465
Landmark Equity Partners III, L.P.(6). . . . . . . . . 924,846
Ontario Municipal Employees Retirement Board(7). . . . 462,422
Palmer & Cay/Carswell, Inc.(8) . . . . . . . . . . . . 2,313
Frankel, Hardwick, Tanenbaum & Fink. . . . . . . . . . 6,937
---------
Total . . . . . . . . . . . . . . . . . 5,025,516
---------
---------
_________________________
(1) Each of the Corporate Selling Shareholders has executed and delivered
a Power of Attorney appointing William A. Davies and Richard L.
Cravey, such Corporate Selling Shareholder's Attorneys-in-Fact.
(2) Represented by Powell, Goldstein, Frazer & Murphy, 191 Peachtree St.,
Atlanta, Georgia 30303, Attention: Gabriel Dumitrescu.
(3) Represented by Delta Air Lines, Inc. Legal Department, Hartsfield
International Airport, Atlanta, Georgia 30320-6001, Attention:
Deborah D. Brown.
(4) Represented by National Life Insurance Legal Department, National Life
Drive, Montpelier, Vermont 05604, Attention: D. Russell Morgan.
(5) Represented by BellSouth Corporation Legal Department, c/o Thomas L.
Harvey, 1155 Peachtree Street, Room 14E05, Atlanta, Georgia 30309-
3610, Attention: Susan Boltacz.
(6) Represented by Testa, Hurwitz & Thibeault, LLP, 125 High Street,
Boston, Massachusetts 02110, Attention: David W. Tegeler.
(7) Represented by Osler, Hoskin & Harcourt, 1 First Canadian Place,
Toronto, Ontario, Canada M5X 1B8, Attention: Steven W. Smith.
(8) Represented by Palmer & Cay/Carswell, Inc. Legal Department, 25 Bull
St., Savannah, Georgia 31401, Attention: David M. Hofele.
<PAGE>
ANNEX I
Pursuant to Section 7(g) of the Underwriting Agreement, Deloitte & Touche,
L.L.P. shall furnish letters to the Underwriters to the effect that:
(i) they are independent public accountants with respect to the
Company and its consolidated subsidiaries within the meaning the Act and
the respective applicable published rules and regulations thereunder;
(ii) in their opinion, the consolidated financial statements and
schedules audited by them and included in and incorporated by reference in
the Prospectus and the Registration Statement comply as to form in all
material respects with the applicable accounting requirements of the Act
and the related published rules and regulations thereunder;
(iii) the financial statements of the Company as of and for the six
month period ended June 30, 1996 were reviewed by them in accordance with
the standards established by the American Institute of Certified Public
Accountants and based upon their review they are not aware of any material
modifications that should be made to such financial statements for them to
be in conformity with generally accepted accounting principles, and such
financial statements comply as to form in all material respects with the
applicable accounting requirements of the Act and the applicable rules and
regulations thereunder;
(iv) On the basis of limited procedures, not constituting an audit
in accordance with generally accepted auditing standards, consisting of a
reading of the unaudited financial statements and other information
referred to below, a reading of the latest available interim financial
statements of the Company and its subsidiaries, inspection of the minute
books of the Company and its subsidiaries since the date of the latest
audited financial statements included and incorporated by reference in the
Prospectus, inquiries of officials of the Company and its subsidiaries
responsible for financial accounting matters and such other inquiries and
procedures as may be specified in such letter, nothing came to their
attention that caused them to believe that:
(A) the unaudited consolidated condensed financial statements of
the Company and its consolidated subsidiaries included and incorporated
by reference in the Registration Statement and the Prospectus do not
comply in form in all material respects with the applicable accounting
requirements of the Act and the Exchange Act and the respective related
published rules and regulations thereunder or are not in conformity
with generally accepted principles applied on the basis substantially
consistent with that of the audited consolidated financial statements
included in the Registration Statement and the Prospectus;
(B) as of a specified date not more than 5 days prior to the date
of such letter, there were any changes in the capital stock (other than
the issuance of capital stock upon exercise of options which were
outstanding on the date of the latest balance sheet included in the
Prospectus) or any increase in inventories or the long-term debt or
short-term debt of the Company and its subsidiaries, or any decreases
in net current assets or net assets or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with amounts shown in the
latest balance sheet included in the Prospectus, except in each case
for changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
<PAGE>
(C) for the period from the date of the latest financial statements
included in the Prospectus to the specified date referred to in Clause
(B) there were any decreases in revenues or operating income or the
total or per share amounts of net income or other items specified by
the Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable period of
the preceding year and with any other period of corresponding length
specified by the Representatives, except in each case for increases or
decreases which the Prospectus discloses have occurred or may occur
which are described in such letter; and
(v) In addition to the audit referred to in their report(s) included
in the Prospectus and the limited procedures, inspection of minute books,
inquiries and other procedures referred to in paragraph (iv) above, they
have carried out certain specified procedures, not constituting an audit in
accordance with generally accepted auditing standards, with respect to
certain amounts, percentages and financial information specified by the
Representatives which are derived from the general accounting records of
the Company and its subsidiaries, included in the Registration Statement
and the Prospectus, or which appear in Part II of, or in exhibits and
schedules to, the Registration Statement specified by the Representatives,
and have compared certain of such amounts, percentages and financial
information with the accounting records of the Company and its subsidiaries
and have found them to be in agreement.
(vi) on the basis of a reading of the unaudited pro forma combined
condensed financial statements included in the Registration Statement and
the Prospectus, carrying out certain specified procedures that would not
necessarily reveal matters of significance with respect to the comments set
forth in this paragraph (vi), inquiries of certain officials of the Company
and its consolidated subsidiaries who have responsibility for financial and
accounting matters and proving the arithmetic accuracy of the application
of the pro forma adjustments to the historical amounts in the unaudited pro
forma consolidated condensed financial statements, nothing came to their
attention that caused them to believe that the unaudited pro forma
consolidated condensed financial statements do not comply as to form in all
material respects with the applicable accounting requirements of Regulation
S-X or that the pro forma adjustments have not been properly applied to the
historical amounts in the compilation of such statements.
References to the Registration Statement and the Prospectus in this Annex I
shall include any amendment or supplement thereto at the date of such letter.
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<PAGE>
ANNEX II
Pursuant to Section 7(h) of the Underwriting Agreement, Coopers & Lybrand
LLP shall furnish letters to the Underwriters to the effect that:
(i) they are independent public accountants with respect to Quality
Mortgage USA, Inc. ("Quality") and subsidiaries within the meaning the Act
and the respective applicable published rules and regulations thereunder;
(ii) in their opinion, the consolidated financial statements audited
by them and included in the Prospectus and the Registration Statement
comply as to form in all material respects with the applicable accounting
requirements of the Act and the related published rules and regulations
thereunder;
(iii) the financial statements of Quality as of and for the nine
month period ended June 30, 1996 were reviewed by them in accordance with
the standards established by the American Institute of Certified Public
Accountants and based upon their review they are not aware of any material
modifications that should be made to such financial statements for them to
be in conformity with generally accepted accounting principles, and such
financial statements comply as to form in all material respects with the
applicable accounting requirements of the Act and the applicable rules and
regulations thereunder;
(iv) On the basis of limited procedures, not constituting an audit
in accordance with generally accepted auditing standards, consisting of a
reading of the unaudited financial statements and other information
referred to below, a reading of the latest available interim financial
statements of Quality and its subsidiaries, inspection of the minute books
of Quality and its subsidiaries since the date of the latest audited
financial statements included in the Prospectus, inquiries of officials of
Quality and its subsidiaries responsible for financial accounting matters
and such other inquiries and procedures as may be specified in such letter,
nothing came to their attention that caused them to believe that:
(A) the unaudited consolidated condensed financial statements of
Quality and its consolidated subsidiaries included in the Registration
Statement and the Prospectus do not comply in form in all material
respects with the applicable accounting requirements of the Act and the
Exchange Act and the respective related published rules and regulations
thereunder or are not in conformity with generally accepted principles
applied on the basis substantially consistent with that of the audited
consolidated financial statements included in the Registration
Statement and the Prospectus;
(B) as of a specified date not more than 5 days prior to the date
of such letter, there were any changes in the capital stock (other than
the issuance of capital stock upon exercise of options which were
outstanding on the date of the latest balance sheet included in the
Prospectus) or any increase in inventories or the long-term debt or
short-term debt of Quality and its subsidiaries, or any decreases in
net current assets or net assets or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with amounts shown in the
latest balance sheet included in the Prospectus, except in each case
for changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
<PAGE>
(C) for the period from the date of the latest financial statements
included in the Prospectus to the specified date referred to in Clause
(B) there were any decreases in revenues or operating income or the
total or per share amounts of net income or other items specified by
the Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable period of
the preceding year and with any other period of corresponding length
specified by the Representatives, except in each case for increases or
decreases which the Prospectus discloses have occurred or may occur
which are described in such letter; and
(v) In addition to the audit referred to in their report(s) included
in the Prospectus and the limited procedures, inspection of minute books,
inquiries and other procedures referred to in paragraph (iv) above, they
have carried out certain specified procedures, not constituting an audit in
accordance with generally accepted auditing standards, with respect to
certain amounts, percentages and financial information specified by the
Representatives which are derived from the general accounting records of
Quality and its subsidiaries, included in the Registration Statement and
the Prospectus, or which appear in Part II of, or in exhibits and schedules
to, the Registration Statement specified by the Representatives, and have
compared certain of such amounts, percentages and financial information
with the accounting records of Quality and its subsidiaries and have found
them to be in agreement.
References to the Registration Statement and the Prospectus in this Annex
II shall include any amendment or supplement thereto at the date of such letter.
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