<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 25, 1996.
REGISTRATION NO. 333-12901
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
BENCHMARK ELECTRONICS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
TEXAS 74-2211011
(STATE OR OTHER JURISDICTION OF INCORPORATION OR
ORGANIZATION) (I.R.S. EMPLOYER IDENTIFICATION NO.)
CARY T. FU
BENCHMARK ELECTRONICS, INC.
3000 TECHNOLOGY DRIVE 3000 TECHNOLOGY DRIVE
ANGLETON, TEXAS 77515 ANGLETON, TEXAS 77515
(409) 849-6550 (409) 849-6550
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE
NUMBER, INCLUDING NUMBER,
AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE
OFFICES) INCLUDING AREA CODE, OF AGENT FOR SERVICE)
</TABLE>
COPIES TO:
<TABLE>
<S> <C>
JOHN R. BRANTLEY ROBERT H. WHILDEN, JR.
BRACEWELL & PATTERSON, L.L.P. VINSON & ELKINS L.L.P.
SOUTH TOWER PENNZOIL PLACE 2300 FIRST CITY TOWER
711 LOUISIANA STREET, SUITE 2900 1001 FANNIN
HOUSTON, TEXAS 77002-2781 HOUSTON, TEXAS 77002-6760
</TABLE>
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC:
As soon as practicable after this Registration Statement becomes effective.
------------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. / /
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE> 2
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated fees and expenses to be incurred in connection with the
Offering are as follows*:
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee............. $ 15,181
National Association of Securities Dealers, Inc. filing fee..... $ 4,902
American Stock Exchange listing fee............................. $ 17,500
Printing and engraving expenses................................. $ 30,000
Legal fees and expenses of counsel for the Company.............. $ 50,000
Accounting fees and expenses.................................... $ 45,000
Blue sky filing fees and expenses (including legal fees and
expenses)..................................................... $ 5,000
Transfer Agent fees............................................. $ 5,000
Miscellaneous................................................... $ 27,417
-------
Total......................................................... $ 200,000
=======
</TABLE>
- ---------------
* Such fees and expenses will be paid by the Company except the Selling
Shareholders will pay their pro rata portion of the Securities and Exchange
Commission registration fee, the National Association of Securities Dealers,
Inc. filing fee, and any Blue Sky filing fees and any other fees and expenses
incurred solely as a result of their participation in the Offering.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Texas Business Corporation Act
Article 2.02-1.B of the Texas Business Corporation Act, as amended (the
"TBCA"), grants to a corporation the power to indemnify a person who was, is or
is threatened to be made a named defendant or respondent in a proceeding because
the person is or was a director of the corporation against judgments, penalties
(including excise and similar taxes), fines, settlements and reasonable expenses
actually incurred in connection therewith, only if it is determined that the
person (1) conducted himself in good faith; (2) reasonably believed that (a) in
the case of conduct in his official capacity as a director of the corporation,
his conduct was in the corporation's best interests, and (b) in all other cases,
his conduct was at least not opposed to the corporation's best interests; and
(3) in the case of any criminal proceeding, he had no reasonable cause to
believe that his conduct was unlawful. Article 2.02-1.C limits the allowable
indemnification by providing that, except to the extent permitted by Article
2.02-1.E, a director may not be indemnified in respect of a proceeding in which
the person was found liable (1) on the basis that he improperly received a
personal benefit, whether or not the benefit resulted from an action taken in
his official capacity, or (2) to the corporation. Article 2.02-1.E provides that
if a director is found liable to the corporation or is found liable on the basis
that he received a personal benefit, the permissible indemnification (1) is
limited to reasonable expenses actually incurred by the person in connection
with the proceeding, and (2) shall not be made in respect of any proceeding in
which the person shall have been found liable for willful or intentional
misconduct in the performance of his duty to the corporation. Finally, Article
2.02-1.H provides that a corporation shall indemnify a director against
reasonable expenses incurred by him in connection with a proceeding in which he
is a named defendant or respondent because he is or was a director if he has
been wholly successful, on the merits or otherwise, in defense of the
proceeding.
With respect to the officers of a corporation, Article 2.02-1.O of the TBCA
provides that a corporation may indemnify and advance expenses to an officer of
the corporation to the same extent that it may indemnify and advance expenses to
directors under Article 2.02-1. Further, Article 2.02-1.O provides that an
officer of a corporation shall be indemnified as, and to the same extent,
provided by Article 2.02-1.H for a director.
II-1
<PAGE> 3
Amended and Restated Bylaws
The Amended and Restated Bylaws of the Company make mandatory the
indemnification of and advancement of expenses to its directors who become
involved in indemnifiable legal proceedings, subject to their compliance with
certain requirements imposed by Texas law.
Indemnity Agreements
The Company has entered into Indemnity Agreements with its directors and
officers pursuant to which the Company generally is obligated to indemnify its
directors and officers to the full extent permitted by Texas law.
Underwriting Agreement
Certain provisions of the Underwriting Agreement by and among the Company,
the Selling Shareholders and the Underwriters, the form of which is filed as
Exhibit 1 hereto, provide for indemnification of the officers and directors of
the Company in certain circumstances.
Registration Rights Agreement
The Registration Rights Agreement by and between the Company and Mason &
Hanger, pursuant to which shares held by Mason & Hanger are included in the
shares covered by this Registration Statement, provides for the indemnification
of the officers and directors of the Company by Mason & Hanger under certain
circumstances.
ITEM 16. EXHIBITS
The exhibits listed below are filed as a part of the Registration
Statement.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------ --------------------------------------------------------------------------
<S> <C>
1* Form of Underwriting Agreement by and among the Company, the Selling
Shareholders and the Underwriters.
5* Opinion of Bracewell & Patterson, L.L.P., regarding the validity of the
shares covered by this Registration Statement.
23.1* Consent of Bracewell & Patterson, L.L.P. (included in the opinion filed as
Exhibit 5 hereto).
23.2 Consent of KPMG Peat Marwick LLP, relating to the Company's financial
statements incorporated by reference herein.
23.3 Consent of KPMG Peat Marwick LLP, relating to EMD's financial statements
incorporated by reference herein.
24 Powers of Attorney.
</TABLE>
- ---------------
* Filed herewith.
ITEM 17. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(b) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such
II-2
<PAGE> 4
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
(c) The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this Registration Statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or
(4) or 497)(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each posteffective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-3
<PAGE> 5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant has duly caused this Amendment No. 2 to Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Angleton, State of Texas, on October 25, 1996.
BENCHMARK ELECTRONICS, INC.
By: /s/ CARY T. FU
-------------------------------
Cary T. Fu
Executive Vice President
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Amendment No. 2 to Registration Statement has been signed by the following
persons in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
NAME POSITION
- -------------------------------------------- --------------------------------------------
<S> <C>
/s/ JOHN C. CUSTER* Chairman of the
- -------------------------------------------- Board of Directors
John C. Custer
/s/ DONALD E. NIGBOR* Director and President
- -------------------------------------------- (principal executive officer)
Donald E. Nigbor
/s/ STEVEN A. BARTON* Director and Executive
- -------------------------------------------- Vice President
Steven A. Barton
/s/ CARY T. FU Director and Executive Vice President
- -------------------------------------------- (principal financial and accounting officer)
Cary T. Fu
/s/ PETER G. DORFLINGER* Director
- -----------------------------------------
Peter G. Dorflinger
Director
- -----------------------------------------
Gerald W. Bodzy
/s/ DAVID H. ARNOLD* Director
- -----------------------------------------
David H. Arnold
</TABLE>
* Pursuant to a power of attorney executed by such individual and filed with the
Commission, Cary T. Fu has executed this Amendment No. 2 on behalf of such
individual on October 25, 1996.
<TABLE>
<S> <C>
/s/ CARY T. FU
- ---------------------------------------
Cary T. Fu
Attorney-in-fact
</TABLE>
II-4
<PAGE> 6
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------ ---------------------------------------------------------------------------
<S> <C>
1* Form of Underwriting Agreement by and among the Company, the Selling
Shareholders and the Underwriters.
5* Opinion of Bracewell & Patterson, L.L.P., regarding the validity of the
shares covered by this Registration Statement.
23.1* Consent of Bracewell & Patterson, L.L.P. (included in the opinion filed as
Exhibit 5 hereto).
23.2 Consent of KPMG Peat Marwick LLP, relating to the Company' s financial
statements incorporated by reference herein.
23.3 Consent of KPMG Peat Marwick LLP, relating to EMD' s financial statements
incorporated by reference herein.
24 Powers of Attorney.
</TABLE>
* Filed herewith.
<PAGE> 1
BENCHMARK ELECTRONICS, INC.
1,300,000 SHARES*
COMMON STOCK
($.10 PAR VALUE)
UNDERWRITING AGREEMENT
____________________________, 1996
STEPHENS INC.
J.C. BRADFORD & CO.
WHEAT, FIRST SECURITIES, INC.
As Representatives of the several
Underwriters named in Schedule I hereto.
c/o Stephens Inc.
111 Center Street
Little Rock, Arkansas 72201
Gentlemen:
Benchmark Electronics, Inc., a Delaware corporation (the "Company"),
together with the Company's individual stockholders (the "Individual
Stockholders") and the corporate stockholder (the "Corporate Stockholder")
named on the signature page hereof (collectively, the "Stockholders") confirm
their agreement with the several underwriters (the "Underwriters") for whom you
are acting as representatives (the "Representatives") for the Company and the
Stockholders to issue and sell 1,000,000 shares and 300,000 shares,
respectively, of the Company's common stock, par value $0.10 per share (the
"Underwritten Shares") to the Underwriters. The Company's common stock is more
fully described in the Registration Statement and the Prospectus hereinafter
mentioned.
For the sole purpose of covering over-allotments in connection with
the sale of the Underwritten Shares, the Company shall grant to the
Underwriters the option (the "Option") described in Section 2 hereof to
purchase all or any part of 187,500 shares of common stock (the "Option
Shares") owned by it. The Underwritten Shares and the Option Shares purchased
pursuant to this Underwriting Agreement (this "Agreement") are herein called
the "Shares" and the proposed offering of the Shares by the Underwriters is
hereinafter referred to as the "Public Offering."
- -----------------------
*Plus up to 187,500 additional shares of common stock to cover
over-allotments.
<PAGE> 2
The Company has filed with the Securities and Exchange Commission (the
"Commission"), pursuant to the Securities Act of 1933, as amended (the "Act"),
and published rules and regulations adopted by the Commission under the Act
(the "Rules"), a registration statement on Form S-3 ("Form S-3") (File No.
333-12901), including a Preliminary Prospectus, relating to the Shares, and
such amendments to such registration statement as may have been filed with the
Commission to the date of this Agreement. The Company will next file with the
Commission one of the following: (A) prior to effectiveness of such
registration statement, a further amendment to such registration statement,
including the form of final prospectus, (B) after effectiveness of such
registration statement, a Term Sheet (if required by Rule 434) relating to the
Shares that shall identify the Preliminary Prospectus that it supplements,
and/or an Integrated Prospectus, in either case in accordance with Rules 434,
430A and 424(b), (C) after effectiveness of such registration statement (if the
Company does not rely on Rule 434), a final prospectus in accordance with Rules
430A and 424(b). The Company has furnished to the Representatives copies of
such registration statement, each amendment to it filed by the Company with the
Commission, and each Preliminary Prospectus and Integrated Prospectus filed by
the Company with the Commission. The registration statement as amended at the
time it becomes or became effective (the "Effective Date"), including financial
statements and all exhibits and any information deemed to be included by Rule
430A, is called the "Registration Statement." The term "Preliminary Prospectus"
means any Preliminary Prospectus (as referred to in Rule 430 or Rule 430A of
the Rules) included at any time as a part of the registration statement. The
term "Integrated Prospectus" means a prospectus relating to the Shares that is
first filed pursuant to Rules 434(c)(2) and 424(b). The term "Prospectus" means
(I) if the Company relies on Rule 434 in connection with the offering of the
Shares, the Term Sheet relating to the Shares that is first filed pursuant to
Rule 424(b) (7) after the date hereof; (2) if the Company does not rely on Rule
434, the prospectus relating to the Shares that is first filed pursuant to Rule
424(b) after the date hereof; or (3) if the Company does not so rely on Rule
434 and no filing pursuant to Rule 424(b) is required, the form of final
prospectus relating to the Shares included in the Registration Statement at the
Effective Date. The term "Term Sheet" means any abbreviated term sheet that
satisfies the requirements of Rule 434.
Any reference herein to the Registration Statement, any Preliminary
Prospectus, any Integrated Prospectus or the Prospectus shall be deemed to
refer to and include any documents incorporated by reference therein on or
before the Effective Date or the date of such Preliminary Prospectus,
Integrated Prospectus or the Prospectus, as the case may be.
The Representatives have advised the Company and the Stockholders that
(a) the Representatives are authorized to enter into this Agreement on behalf
of the several Underwriters and (b) the Underwriters are willing, acting
severally and not jointly, to purchase the amounts of the Underwritten Shares
set forth opposite their respective name in Schedule I hereto, plus their pro
rata portion of the Option Shares if the Representatives elect to exercise the
over-allotment Option in whole or in part for the accounts of the several
Underwriters.
In consideration of the mutual agreements contained herein and of the
interests of the parties in the transactions contemplated hereby, the Company,
the Stockholders and the Underwriters hereby agree as follows:
-2-
<PAGE> 3
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY AND
THE STOCKHOLDERS
(a) The Company represents and warrants to, and agrees with, each
Underwriter as follows:
(i) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Texas, with full power and authority (corporate and other) to own
its properties and conduct its business as described in any Integrated
Prospectus and the Prospectus. Each significant subsidiary (as defined
by the Rules) of the Company (each a "Subsidiary" and collectively,
the Subsidiaries") has been duly incorporated and is validly existing
as a corporation, in good standing under the laws of the jurisdiction
of its organization, with full power and authority (corporate and
other) to own or lease its properties, and conduct its business. The
Company and the Subsidiaries are duly qualified to transact business
in all jurisdictions in which the conduct of its business or the
ownership or lease of its properties requires such qualifications
except where the failure to be so qualified would not reasonably be
expected to have a material adverse effect on the financial condition
or results of operations of the Company and its Subsidiaries on a
consolidated basis ("Material Adverse Effect"). The Company owns all
of the outstanding capital stock of its Subsidiaries free and clear of
any pledge, lien, security interest, encumbrance, claim or equitable
interest.
(ii) The outstanding shares of common stock of the Company
have been duly and validly authorized and issued and are fully paid
and non-assessable; the Shares are duly and validly authorized, and,
if not now issued, when issued and paid for as contemplated herein,
will be fully paid and non-assessable. Except as disclosed in any
Integrated Prospectus or the Prospectus, there are no preemptive or
other restrictive rights to subscribe for or to purchase, or any
restriction upon the voting or transfer of any class of the Company's
common stock pursuant to the Company's Articles of Incorporation,
Bylaws, or other governing documents or any agreement or other
instrument to which the Company or any of its Subsidiaries is a party
or by which any of them may be bound. Neither the filing of the
Registration Statement nor the offering of the Shares as contemplated
by this Agreement gives rise to any rights, other than those which
have been waived or satisfied, for or relating to the registration of
any shares of any class of the Company's capital stock. The Shares
have been approved for listing on the American Stock Exchange (the
"AMEX"), subject to official notice of issuance.
(iii) The Shares conform in all material respects with the
statements concerning them in any Integrated Prospectus and the
Prospectus. As of the Closing Date (as defined below) and any Option
Closing Date (as defined below), if applicable, the Company will have
authorized capital stock as set forth under the caption "Description
of Capital Stock" in any Integrated Prospectus and the Prospectus. No
further corporate approval or authority on behalf of the Company will
be required for the issuance and sale of the Shares to be sold by the
Company as contemplated herein. The description of the Company's stock
option, stock bonus and other stock plans or arrangements, and the
options or other rights granted
-3-
<PAGE> 4
and exercised thereunder, set forth in any Preliminary Prospectus,
Integrated Prospectus or the Prospectus, and any amendments and
supplement thereto, accurately and fairly presents in all material
respects the information required to be shown with respect to such
plans, arrangements, options and rights as of the dates for which such
information is provided.
(iv) Any Preliminary Prospectus, Integrated Prospectus,
the Prospectus and the Registration Statement comply as to form with
the requirements of the Act and the Rules, including Form S-3. The
Company meets the requirements of, and is entitled to use, Form S-3
for the Public Offering. The Registration Statement has been filed
with the Commission pursuant to the Act.
(v) The Commission has not by order or otherwise,
prohibited or suspended the use of any Preliminary Prospectus,
Integrated Prospectus or the Prospectus relating to the proposed
offering of the Shares or instituted proceedings for that purpose. The
Registration Statement, the Prospectus, any Integrated Prospectus and
any Preliminary Prospectus and any amendments or supplements thereto
at the time they became or become effective or were filed or are filed
with the Commission contained or will contain all statements which are
required to be stated therein by, and in all material respects
conformed or will conform to the requirements of, the Act and the
Rules. Neither the Registration Statement, any Integrated Prospectus
nor any Preliminary Prospectus nor any amendment thereto, and neither
the Prospectus nor any supplement thereto, as of its date contained
any untrue statement of a material fact or omitted to state any
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; provided, however, that the Company does
not make any representations or warranties as to information contained
in or omitted from the Registration Statement or any Preliminary
Prospectus or the Prospectus, or any such amendment or supplement, in
reliance upon, and in conformity with, written information furnished
to the Company by or on behalf of any Underwriter through the
Representatives, expressly for use in the preparation thereof as
hereinafter set forth in Section 13, or by or on behalf of any
Stockholder.
(vi) The historical financial statements of the Company,
together with related notes and schedules as set forth in the
Registration Statement, present fairly the financial position and the
results of operations and changes in financial conditions of the
Company, at the indicated dates and for the indicated periods. Such
historical financial statements have been prepared in accordance with
generally accepted accounting principles ("GAAP"), consistently
applied throughout the periods involved, and all adjustments necessary
for a fair presentation of results for such periods have been made.
The Summary Historical Financial Information and the Selected
Historical Financial Data included in the Prospectus and any
Integrated Prospectus present fairly in accordance with GAAP the
information shown therein and have been compiled on a basis consistent
with that of the audited and unaudited financial statements from which
they were derived.
(vii) Except as is disclosed in the Prospectus or any
Integrated Prospectus, there is no action or proceeding pending or, to
the knowledge of the Company, threatened against the Company, any of
its Subsidiaries or any of their respective officers or any of their
properties, assets or rights before any court or administrative or
governmental agency or
-4-
<PAGE> 5
other body which would reasonably be expected to (A) result in any
material adverse change in the condition (financial or otherwise), or
in the earnings, business, affairs, properties, business prospects or
results of operations of the Company and its Subsidiaries on a
consolidated basis ("Material Adverse Change"), whether or not arising
in the ordinary course of business, (B) affect the performance of this
Agreement or the consummation of the transactions herein contemplated,
except as disclosed in the Prospectus or any Integrated Prospectus,
and for which the Company maintains a reserve in an amount which it
believes is adequate to cover potential liabilities, or (C) be
required to be disclosed in the Registration Statement.
(viii) The Company and each of its Subsidiaries are not in
violation of any law, ordinance, governmental rule or regulation or
court decree applicable to the Company or any Subsidiary which
violation would reasonably be expected to have a Material Adverse
Effect.
(ix) The Company and its Subsidiaries have good and
indefeasible title to all of the properties and assets reflected in
the historical financial statements hereinabove described or described
in the Prospectus and any Integrated Prospectus as being owned by
them, subject to no lien, mortgage, pledge, charge or encumbrance of
any kind except those securing indebtedness described in such
financial statements or as described in the Prospectus and any
Integrated Prospectus or which do not materially affect the present or
proposed use of such properties or assets. The Company and its
Subsidiaries occupy their leased properties under valid, subsisting
and binding leases with only such exceptions as in the aggregate are
not material and do not interfere with the conduct of the business of
the Company and its Subsidiaries. There exists no default under the
provisions of any lease, contract or other obligation to which the
Company is a party which may result in a Material Adverse Change.
(x) The Company and its Subsidiaries have filed all
Federal, State and other tax returns and reports which have been
required to be filed and have paid all taxes indicated by said returns
and all assessments received by them to the extent that such taxes
have become due and there is no tax deficiency that has been or, to
the Company's knowledge, might be asserted against the Company or any
of its Subsidiaries that would reasonably be expected to have a
Material Adverse Effect. All material tax liabilities are adequately
provided for on the books of the Company and its Subsidiaries.
(xi) Since the respective dates as of which information is
given in the Registration Statement, any Integrated Prospectus and the
Prospectus, as they may be amended or supplemented, (A) there has not
been any Material Adverse Change nor, to the knowledge of the Company,
is any such change threatened, (B) there has not been any transaction
entered into by the Company or its Subsidiaries that is material to
the earnings, business, affairs, properties, business prospects or
operations of the Company or its Subsidiaries, other than transactions
in the ordinary course of business and changes and transactions
contemplated by the Registration Statement, any Integrated Prospectus
and the Prospectus, as they may be amended or supplemented, (C) other
than changes in the amount outstanding under the Company's revolving
credit facility there has not been any material change in the capital
stock, long term debt or material liabilities of the Company or its
Subsidiaries, and
-5-
<PAGE> 6
(D) there has not been any dividend or distribution of any kind
declared, paid or made on the capital stock of the Company or any of
its Subsidiaries. Neither the Company nor any Subsidiary has any
material contingent obligations or liabilities which are required to
be but are not disclosed in the Registration Statement, any Integrated
Prospectus and the Prospectus.
(xii) The filing of the Registration Statement, any
Integrated Prospectus and related Prospectus and the execution and
delivery of this Agreement have been duly authorized by the Board of
Directors of the Company; this Agreement constitutes a valid and
legally binding obligation of the Company. The Company is not in
breach or violation of or in default under any indenture, mortgage,
deed of trust, lease, contract, note or other agreement or instrument
to which it is a party or by which it or any of its properties is
bound and which breach, violation or default would reasonably be
expected to have a Material Adverse Effect. The consummation of the
transactions herein contemplated and the fulfillment of the terms
hereof will not result in a breach or violation of any of the material
terms and provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, lease, contract, note or other agreement or
instrument to which the Company or any Subsidiary is a party, or of
the Company's or any Subsidiary's charter or by-laws or any law,
decree, order, rule, writ, injunction or regulation applicable to the
Company or any Subsidiary of a court or of any regulatory body or
administrative agency or other governmental body having jurisdiction
except for such breaches, violations, or defaults as would not
reasonably be expected to have a Material Adverse Effect.
(xiii) Each approval, consent, order, authorization.
designation, declaration or filing by or with any regulatory,
administrative or other governmental body necessary in connection with
the execution and delivery by the Company of this Agreement and
performance of its obligations hereunder (except such additional steps
as may be necessary to qualify the Shares for public offering by the
Underwriters under state securities or Blue Sky laws) has been
obtained or made and is in full force and effect.
(xiv) The Company and each Subsidiary hold all material
licenses, authorizations, charters, certificates and permits from
governmental authorities which are necessary to the conduct of their
businesses and neither the Company nor any Subsidiary has received
notice of any proceeding relating to the revocation or modification of
any of such licenses, authorizations, charters, certificates or
permits. The Company and its Subsidiaries own or otherwise possess
rights to the material patents, patent rights, licenses, inventions,
copyrights, trademarks, service marks and trade names presently
employed by them in connection with the businesses now operated by
them, and neither the Company nor any of its Subsidiaries has
infringed or received any notice of infringements of or conflict with
asserted rights of others with respect to any of the foregoing, except
where such infringement or conflict would not reasonably be expected
to result in a Material Adverse Effect.
(xv) To the knowledge of the Company, KPMG Peat Marwick,
independent auditors, who have certified certain of the financial
statements filed with the Commission and included as part of the
Registration Statement and Prospectus, are independent public
accountants within the meaning of the Act, the Rules and Regulation
S-X of the Commission
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<PAGE> 7
and Rule 101 of the Code of Professional Ethics of the American
Institute of Certified Public Accountants.
(xvi) There are no agreements, contracts or other documents
of a character required to be described in the Registration Statement,
any Integrated Prospectus or the Prospectus or required by Form S-3 to
be filed as exhibits to the Registration Statement or incorporated by
reference in the Registration Statement which are not described, filed
or incorporated as required.
(xvii) No labor dispute is pending or, to the knowledge of
the Company, threatened by the Company's or any Subsidiary's
employees, which would reasonably be expected to result in a Material
Adverse Effect. No collective bargaining agreement exists with any of
the Company's employees and, to the Company's knowledge, no agreement
is imminent.
(xviii) Except as contemplated by Section 2 hereof and as
disclosed in any Integrated Prospectus or in the Prospectus and
permitted by the Rules, the Company has not (itself or through any
person) taken and will not take, directly or indirectly, any action
designed to or which would reasonably be expected to, cause or result
in a violation of Section 5 of the Act or Rule 10b-6 under the
Exchange Act ("Rule 10b-6") or in stabilization or manipulation of the
price of the Company's common stock.
(xix) Without limiting the generality of any of the
foregoing representations and warranties, and except to the extent
that no Material Adverse Effect would reasonably be expected to occur
(i) none of the operations of the Company or its Subsidiaries is in
violation of any environmental law, regulation or any permit; (ii)
neither the Company nor any of its Subsidiaries is under investigation
or under review by any governmental agency with respect to compliance
therewith or with respect to the generation, use, treatment, storage
or release of hazardous material; (iii) neither the Company nor any of
its Subsidiaries have any liability or contingent or potential
liability in connection with the past generation, use, treatment,
storage, disposal or release of any hazardous material; (iv) there is
no hazardous material that may reasonably be expected to pose any
material risk to safety, health, or the environment, on, under or
about any property owned, leased or operated by the Company or any of
its Subsidiaries or, to the knowledge of the Company, any property
adjacent to any such property; and (v) there has heretofore been no
release of any hazardous material on, under or about such property,
or, to the knowledge of the Company, any such adjacent property. None
of the present or, to the knowledge of the Company, past property of
the Company or any of its Subsidiaries is listed or proposed for
listing on the National Priorities List pursuant to the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as
amended ("CERCLA") or on the Comprehensive Environmental Response
Compensation Liability Information System List ("CERCLIS") or any
similar state list of sites requiring remedial action. Neither the
Company nor any of its Subsidiaries is subject to any Environmental
Property Transfer Act, or to the extent that any such statute is
applicable to any property, the Company and its Subsidiaries have
fully complied with their obligations under such statute(s), and
neither has any outstanding obligations or liabilities under any
Environmental Property Transfer Act.
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<PAGE> 8
(xx) The Company and its Subsidiaries maintain insurance
of the types and in the amounts generally deemed adequate for their
businesses, including, but not limited to, insurance covering
liability and real and personal property owned or leased by the
Company against theft, damage, destruction, acts of vandalism and all
other risks customarily insured against, all of which insurance is in
full force and effect.
(xxi) Neither the Company nor any Subsidiary has at any
time during the last five years (a) made any unlawful contribution to
any candidate for foreign office, or failed to disclose fully any
contribution in violation of law, or (b) made any payment to any
federal or state governmental officer or official, or other person
charged with similar public or quasi-public duties, other than
payments required or permitted by the laws of the United States or any
jurisdiction thereof.
(xxii) Each officer and director of the Company and each
Stockholder of the Company has agreed that such person will not, for a
period of 120 days after the effective date of the Registration
Statement, offer to sell, contract to sell, sell short, or otherwise
sell or dispose of any shares of common stock of the Company, or any
securities convertible into or exchangeable for shares of the common
stock owned directly by such person or with respect to which such
person has the power of disposition otherwise than hereunder or with
the prior written consent of Stephens Inc., in accordance with a
lock-up agreement to be executed by such person, a form of which is
attached hereto as Exhibit "A" and included herein (the "Lock-Up
Agreement").
(b) Any certificate signed by any officer of the Company or by any
Stockholder, as the case may be, and delivered to you or counsel for the
Underwriters shall be deemed a representation and warranty by the Company or
such Stockholder to the Underwriters as to the matters covered thereby.
(c) Each Stockholder represents and warrants to, and agrees with
each Underwriter as follows:
(i) As of the Effective Date, the Stockholder is the
lawful owner of the number of Shares to be sold by such Stockholder,
and has or at such time or times, as required, will have good and
valid title to all such Shares, free of all restrictions on transfer
(other than those imposed by the Act, the Company's Articles of
Incorporation and Bylaws and the securities or Blue Sky laws of
certain jurisdictions) liens, encumbrances, security interests and
claims whatsoever, except for claims created hereunder or under a
Power of Attorney (as defined herein) or Custody Agreement (as defined
herein) in favor of the Underwriters;
(ii) The Stockholder has full legal right, power and
authority, and any approvals required by law and any agreement or
instrument to which the Stockholder is a party, to enter into this
Agreement, and this Agreement has been fully executed and delivered by
the Stockholder;
(iii) Upon delivery of payment for the Shares to be sold by
the Stockholder pursuant to this Agreement, good and valid title to
such Shares will pass, free of all
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<PAGE> 9
restrictions on transfer (other than those imposed by the Act, the
Company's Articles of Incorporation and the securities or Blue Sky
laws of certain jurisdictions) liens, encumbrances, security interests
and claims whatsoever, to each Underwriter;
(iv) The Stockholder has duly authorized (if applicable),
executed and delivered a power of attorney and custody agreement, a
form of which is attached hereto as Exhibit "B" and included herein
(the "Power of Attorney and Custody Agreement"), appointing Donald E.
Nigbor and Cary T. Fu as attorneys-in-fact (collectively the
"Attorneys" and individually the "Attorney"), and each of them, acting
jointly, as custodian (the "Custodian"). The Power of Attorney and
Custody Agreement constitutes a valid and binding agreement of such
Stockholder, enforceable in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or
affecting creditors' rights generally or by general equitable
principles; and the Stockholder's Attorney, acting alone, is
authorized to execute and deliver this Agreement and the certificate
referred to in Section 6(l) hereof, on behalf of such Stockholder to
determine the purchase price to be paid by the several Underwriters to
such Stockholder as provided in Section 2 hereof, to authorize the
delivery of the Stockholder's Shares under this Agreement and to duly
endorse (in blank or otherwise) the certificate or certificates
representing such Shares or a stock power or powers with respect
thereto, to accept payment therefore, and otherwise to act on behalf
of such Stockholder in connection with this Agreement;
(v) All authorizations, approvals, consents and orders
necessary for the execution and delivery by such Stockholder of the
Power of Attorney and Custody Agreement, the execution and delivery by
or on behalf of such Stockholder of this Agreement and the sale and
delivery of the Stockholder Shares under this Agreement (other than,
at the time of the execution hereof (if the Registration Statement has
not yet been declared effective by the Commission), the issuance of
the order of the Commission declaring the Registration Statement
effective and such authorizations, approvals or consents as may be
necessary under state or other securities or Blue Sky Laws) have been
obtained and are in full force and effect; such Stockholder, if other
than a natural person, has been duly organized and is validly existing
and in good standing under the laws of the jurisdiction of its
organization as the type of entity that it purports to be; and such
Stockholder has full right, power and authority to enter into and
perform its obligations under this Agreement and such Power of
Attorney and Custody Agreement, and to sell, assign, transfer and
deliver the Shares to be sold by such Stockholder under this
Agreement.
(vi) Such Stockholder will not, for a period of 120 days
after the effective date of the Registration Statement, offer to sell,
contract to sell or otherwise sell or dispose of any shares of the
Company's common stock, any options or warrants to purchase any shares
of the Company's common stock, or any securities convertible into or
exchangeable for shares of the Company's common stock, owned directly
by such Stockholder or with respect to which such Stockholder has the
power of disposition, otherwise than hereunder or with the prior
written consent of Stephens Inc. Such Stockholder agrees and consents
to the entry of stop transfer instructions with the Company's transfer
agent against the transfer of shares of
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<PAGE> 10
common stock held by such Stockholder except in compliance with the
foregoing restrictions.
(vii) Certificates in negotiable form for all Shares to be
sold by such Stockholder under this Agreement, together with a stock
power or powers duly endorsed in blank by such Stockholder, have been
placed in custody with the Custodian for the purpose of effecting
delivery hereunder;
(viii) This Agreement has been duly authorized by the
Corporate Stockholder and has been duly executed and delivered by or
on behalf of such Stockholder and the performance of this Agreement
and the consummation of the transactions herein contemplated will not
result in a breach of or default under any material bond, debenture,
note or other evidence of indebtedness, or any material contract
indenture, mortgage, deed of trust, loan agreement, lease or other
agreement or instrument to which such Corporate Stockholder is a party
or by which such Corporate Stockholder or any Stockholder Shares
hereunder may be bound or, to the best of such Corporate Stockholder's
knowledge, result in any violation of any law, order, rule,
regulation, writ, injunction or decree of any court or governmental
agency or body or, result in any violation of any provisions of the
charter, bylaws or other organizational documents of such Corporate
Stockholder;
(ix) The Stockholder has not distributed and will not
distribute any prospectus or other offering material in connection
with the offering and sale of the Shares;
(x) All information furnished by or on behalf of such
Stockholder relating to such Stockholder and the Stockholder's Shares
that is contained in the representations and warranties of such
Stockholder in such Stockholder's Power of Attorney and Custody
Agreement or set forth in the Registration Statement and any
Preliminary Prospectus, Integrated Prospectus, or the Prospectus and
any amendments or supplements thereto is, and on the Closing Date and
on any later date on which Option Shares are to be purchased as the
case may be, will be, true, correct and complete, and does not, and on
the Closing Date and on any later date on which Option Shares are to
be purchased, as the case may be, will not contain an untrue statement
of a material fact or omit to state a material fact necessary to make
such statements, in light of the circumstances in which they were
made, not misleading;
(xi) The Stockholder will review the Prospectus and will
comply with all agreements and satisfy all conditions on its part to
be complied with or satisfied pursuant to this Agreement on or prior
to the Closing Date, or any later date on which Option Shares are to
be purchased, as the case may be, and will advise one of its Attorneys
prior to the Closing Date or such later date on which Option Shares
are to be purchased, as the case may be, if any statement to be made
on behalf of such Stockholder in the certificate contemplated by
Section 6(m) would be inaccurate if made as of the Closing Date or
such later date on which Option Shares are to be purchased, as the
case may be;
(xii) The Stockholder does not have, or has waived prior to
the date hereof, any preemptive right, co-sale right or right of first
refusal or other similar right to purchase any
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<PAGE> 11
of the Shares that are to be sold by the Company or any of the other
Stockholders to the Underwriters pursuant to this Agreement; and such
Stockholder does not own any warrants, options or similar rights to
acquire, and does not have any right or arrangement to acquire, any
capital stock, rights, warrants, options or other securities from the
Company, other than those described in the Registration Statement and
any Preliminary Prospectus, Integrated Prospectus, or the Prospectus
and any amendments or supplements thereto;
(xiii) The Individual Stockholders are not aware that any
representations and warranties of the Company set forth in Section
1(a) above are untrue or inaccurate in any material respect;
(xiv) The Stockholder has not taken, nor will take,
directly or indirectly, any action designed to, or which might
reasonably be expected to, cause or result in stabilization or
manipulation of the price of any security of the Company to facilitate
the sale or resale of the Shares owned by such Stockholder pursuant to
the distribution contemplated by this Agreement;
(xv) The Stockholder will pay or cause to be paid all
transfer taxes, if any, with respect to the Shares to be sold by such
Stockholder;
2. PURCHASE, SALE AND DELIVERY OF THE UNDERWRITTEN SHARES. On the
basis of the representations, warranties and covenants herein contained, and
subject to the terms and conditions herein set forth, the Company and the
Stockholders agree to sell each Underwriter, severally and not jointly, and
each Underwriter agrees, severally and not jointly, to purchase, at a price of
$_________ per share, the number of the Underwritten Shares set forth on
Schedule I attached hereto, subject to adjustment in accordance with Section 10
hereof.
Payment for the Underwritten Shares shall be made by wire transfer of
U.S. Funds to the designated accounts of the Company and the Stockholders, to
the order of the Company and the Stockholders, as applicable, against delivery
of certificates for the Shares to the Representatives for the accounts of the
several Underwriters. Delivery of certificates shall be to the Representatives
c/o Stephens Inc. ("Stephens"), 111 Center Street, Little Rock, Arkansas 72201,
or at such other address as Stephens may designate in writing. Payment will be
made at the offices of Stephens, or at such other place as shall be agreed upon
by Stephens and the Company, at approximately 9:00 a.m., central time, on
____________________, 1996, such time and date being herein referred to as the
"Closing Date." The certificates for the Underwritten Shares will be delivered
in such denominations and in such registrations as Stephens requests in writing
and will be made available for inspection at such locations as Stephens may
reasonably request at least one full business day prior to the Closing Date.
The certificates in negotiable form for the Stockholder Shares have
been placed in custody (for delivery under this Agreement) under the Power of
Attorney and Custody Agreement. Each Stockholder agrees that the certificates
for the Stockholder Shares of such Stockholder so held in custody are subject
to the interests of the Underwriters hereunder, that the arrangements made by
such Stockholder for such custody, including the Power of Attorney, is to that
extent irrevocable and that the obligations of such Stockholder hereunder shall
not be terminated by the act of such
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<PAGE> 12
Stockholder or by operation of law, whether by the death or incapacity of such
Stockholder or the occurrence of any other event, except as specifically
provided herein or in the Power of Attorney and Custody Agreement. If any
Stockholder should die or be incapacitated, or if any other such event should
occur, before the delivery of the certificates for the Stockholder Shares
hereunder, the Stockholder Shares to be sold by such Stockholder shall, except
as specifically provided herein or in the Power of Attorney and Custody
Agreement, be delivered by the Custodian in accordance with the terms and
conditions of this Agreement as if such death, incapacity or other event had
not occurred, regardless of whether the Custodian shall have received notice of
such death or event.
In addition, on the basis of the representations, warranties,
agreements and covenants herein contained and subject to the terms and
conditions herein set forth, the Company hereby grants the Option to the
several Underwriters to purchase the Option Shares at the price per share as
set forth in the first paragraph of this Section 2. The Option may be exercised
in whole or in part on one occasion upon written notice (or oral notice,
subsequently confirmed in writing) given not more than thirty (30) days
following the date of this Agreement, by Stephens Inc., on behalf of the
Representatives of the several Underwriters, to the Company setting forth the
number of Option Shares as to which the several Underwriters are exercising the
Option and the names and denominations in which the Option Shares are to be
registered. Closing on the purchase of the Option Shares (the "Option Closing
Date"), if any, shall occur no later than three (3) business days following the
date upon which notice of exercise of the Option is given to the Company, and
shall take place at the offices of Stephens Inc., or at such other place as
shall be agreed upon by Stephens Inc. and the Company. Subject to adjustment
in accordance with Section 10 hereof, the number of Option Shares to be
purchased by each Underwriter shall be in the same proportion to the total
number of shares of the common stock being purchased by such Underwriter bears
to 1,300,000 shares, adjusted by you in such manner as to avoid fractional
shares. The Option may be exercised only to cover over-allotments in the sale
of the Underwritten Shares by the Underwriters. Stephens Inc., on behalf of
the Representatives of the several Underwriters, may cancel such option at any
time prior to its expiration by giving written notice (or oral notice,
subsequently confirmed in writing) of such cancellation to the Company. To the
extent, if any, that the Option is exercised, payment for the Option Shares
shall be made at such closing by wire transfer of immediately available U.S.
Funds to a designated account of the Company, to the order of the Company.
Certificates for the Option Shares shall be delivered in the same manner and
upon the same terms as the Underwritten Shares.
3. OFFERING BY THE UNDERWRITERS. It is understood that the Public
Offering of the Underwritten Shares is to be made as soon as the
Representatives deem it advisable to do so after the Registration Statement has
become effective. The Underwritten Shares are to be initially offered to the
public at the public offering price set forth in the Prospectus. The
Representatives may from time to time thereafter change the public offering
price and other selling terms. To the extent, if at all, that any Option Shares
are purchased pursuant to Section 2 hereof, the Underwriters will offer them to
the public on the foregoing terms.
It is further understood that the Representatives will act as the
representatives for the Underwriters in the offering and sale of the Shares, in
accordance with an Agreement Among Underwriters which has been entered into by
the Representatives and the several other Underwriters.
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<PAGE> 13
4. COVENANTS OF THE COMPANY. The Company covenants and agrees
with each of the several Underwriters that:
(a) The Company will use its best efforts to cause the
Registration Statement to become effective and will not, either before
or after effectiveness, file any amendment thereto or supplement
(including any Term Sheet) to the Prospectus or any Integrated
Prospectus (including a prospectus filed pursuant to Rule 424(b) which
differs from the Prospectus on file at the time the Registration
Statement becomes effective) or file any documents under the Exchange
Act before the earlier to occur of (A) the 35th day following the
Effective Date or (B) the closing date of the Underwriters' purchase
of the Option Shares if such document would be deemed to be
incorporated by reference into the Registration Statement, the
Preliminary Prospectus, any Integrated Prospectus or the Prospectus of
which the Representatives shall not previously have been advised and
furnished with a copy or to which the Representatives shall have
reasonably objected in writing or which is not in compliance with the
Act or Rules.
(b) The Company will advise the Representatives promptly
of any request of the Commission or other securities regulatory agency
("Other Securities Regulator") for amendment of the Registration
Statement or for supplement (including any Term Sheet) to the
Prospectus or any Integrated Prospectus or for any additional
information, or of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the use
of the Prospectus or any Integrated Prospectus or of the institution
of any proceedings for that purpose, or comparable action taken or
initiated by any Other Securities Regulator, and the Company will use
all reasonable efforts to prevent the issuance of any such stop order
preventing or suspending the use of the Prospectus or any Integrated
Prospectus and to obtain as soon as possible the lifting thereof, if
issued.
(c) The Company will cooperate with the Representatives
in endeavoring to qualify the Shares for sale under the securities
laws of such jurisdictions (including foreign jurisdictions) as the
Representatives may reasonably designate, and will make such
applications, file such documents, and furnish such information as may
be reasonably required for that purpose; provided, however, 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
where it is not so qualified or required to file such a consent. The
Company will, from time to time, prepare and file such statements
reports and other documents, as are or may be required to continue
such qualifications in effect for so long a period as the
Representatives may reasonably request for distribution of the Shares.
(d) The Company will deliver to, or to the order of, the
Representatives, from time to time, as many copies of any Preliminary
Prospectus, Integrated Prospectus or the Prospectus as the
Representatives may reasonably request. The Company will deliver to,
or to the order of, the Representatives, on the Effective Date and
thereafter from time to time during the period when delivery of a
Prospectus is required under the Act as many copies of the Prospectus
in final form, or as thereafter amended or supplemented, as the
Representatives may reasonably request. The Company will deliver to
the Representatives at or before the Closing Date, three (3) manually
signed copies of the Registration Statement
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<PAGE> 14
and all amendments thereto including all exhibits filed therewith
(including any document filed under the Exchange Act and deemed to be
incorporated by reference into the Registration Statement, the
Preliminary Prospectus, any Integrated Prospectus or the Prospectus)
and will deliver to the Representatives such number of copies of the
Registration Statement, but without exhibits, and of all amendments
thereto, as the Representatives may reasonably request.
(e) During the time during which a Prospectus or any
Integrated Prospectus relating to the Shares is required by law to be
delivered, the Company shall comply with all requirements imposed upon
it by the Act, as now and hereafter amended, and by the Rules, as from
time to time in force, so far as is necessary to permit the
continuance of sales of or dealings in the Shares as contemplated by
the provisions hereof and the Prospectus or any Integrated Prospectus.
If, during the period in which a Prospectus or any Integrated
Prospectus is required by law to be delivered, any event shall occur
as a result of which, in the judgment of the Company or in the opinion
of counsel for the Underwriters, it becomes necessary to amend or
supplement the Prospectus or any Integrated Prospectus in order to
make the statements therein, in the light of the circumstances
existing at the time the Prospectus or any Integrated Prospectus is
delivered to a purchaser, not misleading, or, if it is necessary at
any time to amend or supplement the Prospectus or any Integrated
Prospectus to comply with any law or to file under the Exchange Act
any document which would be deemed to be incorporated by reference in
the Prospectus or in any Integrated Prospectus in order to comply with
the Act or the Exchange Act, the Company promptly will notify the
Representatives and, subject to the Representatives' prior review,
prepare and file with the Commission and any appropriate Other
Securities Regulator an appropriate amendment or supplement to the
Prospectus or any Integrated Prospectus (at the expense of the
Company) so that the Prospectus or any Integrated Prospectus as so
amended or supplemented will not, in light of the circumstances when
it is so delivered, be misleading, or so that the Prospectus or any
Integrated Prospectus will comply with the law.
(f) The Company will make generally available to its
security holders in the manner contemplated by Rule 158(b) under the
Act, as soon as it is practicable to do so, but in any event not later
than the forty-fifth day after the fiscal quarter first occurring one
year after the Effective Date, an earnings statement in reasonable
detail, covering a period of at least twelve consecutive months
beginning after the Effective Date, which earnings statement shall
satisfy the requirements of Section 11(a) of the Act and will advise
you in writing when such statement has been so made available.
(g) For a period of five years after the Closing Date,
the Company will deliver to the Representatives such number of copies
as the Representatives may reasonably request of annual reports and
information furnished by the Company to its shareholders or filed with
any securities exchange pursuant to the requirements of such exchange
or with the Commission pursuant to the Act or the Exchange Act
concurrently with the time such documents are furnished to the
Company's shareholders or filed with any exchange or the Commission,
as the case may be. The Company will deliver to the Representatives
similar reports and information with respect to the Company's
significant subsidiaries, as defined in the Rules, which are not
consolidated in the Company's financial statements.
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<PAGE> 15
(h) As soon as the Company is advised thereof, it will
advise the Representatives, and confirm in writing, that the
Registration Statement and any amendments shall have become effective.
(i) The Company will use the net proceeds from the sale
of the Shares in the manner set forth in the Prospectus or in any
Integrated Prospectus under the caption "Use of Proceeds."
(j) Other than as permitted by the Act and the Rules, the
Company will not distribute any prospectus or offering materials in
connection with the offering and sale of the Shares and prior to the
Closing Date or the Option Closing Date will not issue any press
releases or other communications directly or indirectly and will hold
no press conferences with respect to the Company, the financial
condition, results of operations, business, properties, assets or
liabilities of the Company, or the offering of the Shares, without the
prior written consent of Stephens Inc.
(k) The Company will maintain a transfer agent and, if
necessary under the jurisdiction of incorporation of the Company, a
registrar for its common stock and will, use its best efforts to
maintain the listing of the Shares on the AMEX.
(l) Except as contemplated hereby or by the Prospectus,
the Company will not, for a period of 120 days after the Effective
Date of the Registration Statement, offer to sell, contract to sell,
sell or otherwise dispose of any shares of the Company's common stock
or securities convertible into shares of the Company's common stock
without the prior written consent of Stephens Inc. The Company
covenants to obtain the foregoing commitment from each of its
executive officers and directors and the Stockholders.
The foregoing covenants and agreements shall apply to any successor of
the Company, including without limitation, any entity into which the Company
might merge.
5. COSTS AND EXPENSES. Whether or not the Registration Statement
becomes effective, the Company will pay all costs, expenses and fees incident
to the performance of the obligations of the Company under this Agreement,
including, without limiting the generality of the foregoing, the following:
accounting fees of the Company; the fees and disbursements of counsel for the
Company; the cost of printing and delivering to Underwriters copies of the
Registration Statement, Preliminary Prospectus, any Integrated Prospectus, the
Prospectus, this Agreement, the Agreement Among Underwriters, the Selected
Dealer Agreement, Underwriters' Questionnaire and Power of Attorney, and the
Blue Sky Survey and any supplements thereto; the filing fees of the Commission;
the filing fees incident to securing any required review by the NASD of the
terms of the sale of the Shares; the cost of printing certificates representing
the Shares; the cost and charges of any transfer agent or registrar; and the
expenses, including the reasonable fees and disbursements of counsel for the
Underwriters, incurred in connection with the qualification of the Shares under
State securities or Blue Sky laws and the laws of any foreign jurisdiction;
provided, however, that the Stockholders shall pay all fees and disbursements
of their counsel retained and incurred by them and their pro rata portion of
the Commission filing fee, Blue Sky fees and any other costs, expenses and fees
incurred solely as a result of their participation in the offering. If, in the
opinion of counsel to the
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<PAGE> 16
Underwriters, the qualification of the Shares under any State securities or
Blue Sky laws requires that the Company and the Stockholders share any of the
costs, expenses and fees set forth above, the Company and the Stockholders
agree to share pro rata, based on the number of Shares to be sold by each, such
costs, expenses and fees as identified by counsel. Any transfer taxes imposed
on the sale of the Shares to the Underwriters will be paid by the Company or
the Stockholders as the case may be. The Company shall not, however, be
required to pay for any of Underwriters' expenses (other than those related to
qualification under State securities or Blue Sky laws) except that, if this
Agreement shall not be consummated because the conditions in Section 7 hereof
are not satisfied, or because this Agreement is terminated by the
Representatives pursuant to Section 6 hereof, or by reason of any failure,
refusal or inability on the part of the Company to perform any undertaking or
satisfy any condition of this Agreement or to comply with any of the terms
hereof on their part to be performed, unless such failure to satisfy said
condition or to comply with said terms is due to the default or omission of any
Underwriter, then the Company shall reimburse the several Underwriters for all
costs and expenses, including attorney fees and out-of-pocket expenses,
reasonably incurred in connection with investigating, marketing and proposing
to market the Shares or in contemplation of performing their obligations
hereunder but the Company shall not in any event be liable to any of the
several Underwriters for damages on account of loss of anticipated profits from
the sale by them of the Shares.
6. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS. The obligations
of the several Underwriters to purchase and pay for the Shares as provided
herein, are subject to the accuracy, as of the Closing Date and as of the
Option Closing Date, of the representations and warranties and agreements of
the Company and the Stockholders contained herein, to the performance by the
Company and the Stockholders of their obligations hereunder and to the
following additional conditions:
(a) The Registration Statement shall have become
effective not later than 11:00 a.m., central daylight time, on the
date of this Agreement, unless a later time and date is agreed to by
the Representatives, and no stop order or other order suspending the
effectiveness thereof or the qualification of the Shares under the
State securities or Blue Sky laws of any jurisdiction shall have been
issued and no proceeding for that purpose shall have been taken or, to
the knowledge of the Company, shall be contemplated or threatened by
the Commission or any Other Securities Regulator. If the Company has
elected to rely upon Rule 430A of the Rules, the price of the Shares
and any price-related information previously omitted from the
effective Registration Statement pursuant to such Rule 430A shall have
been transmitted to the Commission for filing pursuant to Rule 424(b)
of the Act within the prescribed time period, and prior to the Closing
Date the Company shall have provided evidence satisfactory to the
Representatives of such timely filing, or a post-effective amendment
providing such information shall have been promptly filed and declared
effective in accordance with the requirements of Rule 430A under the
Act. All requests for additional information on the part of the
Commission or any other government or regulatory authority with
jurisdiction (to be included in the Registration Statement, any
Integrated Prospectus or Prospectus or otherwise) shall be complied
with to the satisfaction of the Commission or such authorities.
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<PAGE> 17
(b) The Representatives shall have received on the
Closing Date and on the Option Closing Date the opinion of Bracewell &
Patterson L.L.P., counsel for the Company and the Individual
Stockholders, dated the Closing Date and the Option Closing Date, as
the case may be, addressed to the Underwriters in form and substance
satisfactory to Vinson & Elkins L.L.P., counsel to the Underwriters,
to the effect that:
(i) The Company and its Subsidiaries have been
duly incorporated and are validly existing as corporations in
good standing under the laws of the state of their
incorporation with full corporate power and authority to own
their properties and conduct their businesses as described in
the Registration Statement, any Integrated Prospectus and
Prospectus; the Company and its Subsidiaries are duly
qualified to transact business in all jurisdictions in which
the conduct of their businesses or the ownership or lease of
the properties requires such qualification except where the
failure to be so qualified would not reasonably be expected to
have a Material Adverse Effect; and all of the outstanding
shares of capital stock of the Company have been validly
authorized and issued, are fully paid and non-assessable, and
except as set forth in the Prospectus, any Integrated
Prospectus, and the Registration Statement and except for
directors' qualifying shares, if any, no options, warrants or
other rights to purchase, agreements or other obligations to
issue or other rights to convert any obligations into any
shares of capital stock are outstanding.
(ii) The Company has authorized and, to such
counsel's knowledge after due inquiry, outstanding the capital
stock set forth under the caption "Description of Capital
Stock" in the Registration Statement, any Integrated
Prospectus and Prospectus except for issuances subsequent to
the date of the Prospectus, if any, pursuant to reservations,
commitments, employee benefit plans, agreements or the
exercise of convertible securities disclosed in the
Registration Statement, any Integrated Prospectus and the
Prospectus; all of the Shares conform to the description
thereof contained in the Prospectus and any Integrated
Prospectus; the Underwritten Shares, and the Option Shares, if
any, to be sold pursuant to this Agreement have been duly
authorized and will be validly issued, fully paid and
non-assessable when issued and paid for as contemplated by
this Agreement; to such counsel's knowledge after due inquiry,
except as disclosed in any Integrated Prospectus and the
Prospectus, there are no preemptive or other restrictive
rights to subscribe for or to purchase or any restriction upon
the voting or transfer of any shares of any class of the
Company's capital stock pursuant to the Company's Articles of
Incorporation, Bylaws, other governing documents or any
agreement or other instrument to which the Company is a party
or by which it is bound; to such Counsel's knowledge after due
inquiry, neither the filing of the Registration Statement nor
the offering or sale of the Shares as contemplated by this
Agreement gives rise to any rights, other than those which
have been waived or satisfied, for or relating to the
registration of any shares of the Company's common stock or
other securities of the Company.
(iii) The Registration Statement has become
effective under the Act and to the knowledge of such counsel
no stop order proceedings with respect thereto have
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<PAGE> 18
been instituted or are pending or threatened under the Act and
any and all filings required by Rule 424 and Rule 430A of the
Rules have been made.
(iv) The Registration Statement, all Preliminary
Prospectuses, any Integrated Prospectus, the Prospectus and
each amendment or supplement thereto comply as to form in all
material respects with the requirements of the Act and the
Rules, including Form S-3, except that such counsel need
express no opinion as to the financial statements, schedules
and other financial or statistical information included or
incorporated therein.
(v) The Company meets the requirements of, and is
entitled to use, Form S-3 for the Public Offering.
(vi) The statements under the caption "Description
of Capital Stock" in the Prospectus or any Integrated
Prospectus that constitute a summary of documents referred to
therein or matters of law, are accurate summaries and fairly
and correctly represent the material information required with
respect to such documents and matters.
(vii) All descriptions, in the Preliminary
Prospectus, any Integrated Prospectus, and the Prospectus, of
statutes, regulations, legal or governmental proceedings,
contracts and other documents are accurate in all material
respects and fairly present the material information required
to be shown; and, after due inquiry, such counsel does not
know of any contracts or documents of a character required to
be summarized or described therein or to be filed as exhibits
thereto which are not so summarized, described or filed.
(viii) To such counsel's knowledge after due
inquiry, there are no legal, regulatory or administrative
proceedings pending or threatened against the Company or any
of its Subsidiaries which are required to be but are not
disclosed in the Prospectus or any Integrated Prospectus.
(ix) Neither the Company nor any of its
Subsidiaries is, nor with the giving of notice or lapse of
time or both would be, in violation of or in default under,
nor will the execution or delivery hereof or consummation of
the transactions contemplated hereby result in a violation of,
or constitute a default under, the Articles of Incorporation,
By-laws or other governing documents of the Company or any of
its Subsidiaries, to such counsel's knowledge after due
inquiry, or any agreement, indenture or other instrument to
which the Company or any of its Subsidiaries is a party or by
which it is bound, or to which their properties are subject,
nor will the performance by the Company of its obligations
hereunder violate any law, rule, administrative regulation or
decree of any court or any governmental agency or body having
jurisdiction over the Company or any of its Subsidiaries or
their properties, (except that such counsel need express no
opinion with respect to state securities or Blue Sky laws) or
result in the creation or imposition of any lien, charge,
claim or encumbrance upon any property or asset of the Company
or any of its Subsidiaries.
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<PAGE> 19
(x) This Agreement has been duly authorized,
executed and delivered by the Company.
(xi) No approval, consent, order, authorization,
designation, declaration or filing by or with any regulatory,
administrative or other governmental body is necessary in
connection with the execution and delivery of this Agreement
and the consummation of the transactions herein contemplated
(other than required by state securities and Blue Sky laws as
to which such counsel need express no opinion) except such as
have been obtained or made, specifying the same.
(xii) To the knowledge of such counsel after due
inquiry, the Company and its Subsidiaries hold all material
licenses, authorizations, charters, certificates and permits
from governmental authorities that are necessary for the
conduct of their businesses and the Company and its
Subsidiaries have not received notice of any proceeding
relating to the revocation or modification of any of such
licenses, authorizations, charters or permits. To the
knowledge of such counsel after due inquiry, the Company and
its Subsidiaries have good and indefeasible title to all
property owned by them, free and clear of all liens,
encumbrances, restrictions and defects except such as are
described in the Registration Statement or do not materially
interfere with the use made and proposed to be made of such
property.
(xiii) Each Individual Stockholder has full right,
power and authority to enter into and to perform his
obligations under the Power of Attorney and Custody Agreement
to be executed and delivered by him in connection with the
transactions contemplated herein; the Power of Attorney and
the Custody Agreement of each Individual Stockholder has been
duly executed and delivered by or on behalf of such Individual
Stockholder; and the Power of Attorney and the Custody
Agreement of each Individual Stockholder constitutes the valid
and binding agreement of such Stockholder, enforceable in
accordance with its terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting
creditors' rights generally or by general equitable
principles.
(xiv) Each Individual Stockholder has full right,
power and authority to enter into and to perform its
obligations under this Agreement and to sell, transfer, assign
and deliver the Shares to be sold by such Individual
Stockholder hereunder.
(xv) Upon the delivery and payment for the Shares
as contemplated in this Agreement, each of the Underwriters
will receive valid title to the Shares purchased by it from
such Individual Stockholder, free and clear of any pledge,
lien, security interest, encumbrance, claim or equitable
interest. In rendering such opinion, such counsel may assume
that the Underwriters are without notice of any defect in the
title of any of such Individual Stockholder's Shares being
purchased from such Individual Stockholders.
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<PAGE> 20
In addition to the matters set forth above, such opinion shall also
state that such counsel has participated in conferences with officers and other
representatives of the Company, representatives of the independent accountants
of the Company and representatives of the Representatives and their counsel at
which the contents of the Registration Statement, the Prospectus and any
Integrated Prospectus and related matters were discussed, and although such
counsel is not passing upon and does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement, the Prospectus and any Integrated Prospectus, on the
basis of the foregoing, no facts have come to the attention of such counsel
that lead such counsel to believe that the Registration Statement or any
amendment thereto (other than the financial statements, schedules and other
financial or statistical information included or incorporated therein as to
which such counsel need express no view), at the time it became effective,
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
not misleading, or that any Integrated Prospectus or the Prospectus or any
amendment or supplement thereto (other than the financial statements, schedules
and other financial or statistical information included or incorporated therein
as to which such counsel need express no view), as of their respective dates,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. Such opinion may state further that it is limited to the law of
the State of Texas and the applicable law of the United States of America and
that such counsel renders no opinion with respect to the law of any other
jurisdiction. Such opinion may state further that whenever such opinion is
based on factual matters to such counsel's knowledge after due inquiry or known
to such counsel after due inquiry, such counsel has relied exclusively on
certificates of officers (after discussion of the contents thereof with such
officers) of the Company or certificates of others as to the existence or
nonexistence of factual matters on which such opinion is predicated but has no
reason to believe that any such certificate is untrue or inaccurate in any
material respect.
Such opinion shall be to such further effect with respect to other
legal matters relating to this Agreement and contain only those qualifications
as Vinson & Elkins L.L.P., counsel to the Underwriters, may reasonably request
or allow.
(c) The Representatives shall have received on the Closing Date
and on the Option Closing Date the opinion of Sloan & Garrett PSC, counsel for
the Corporate Stockholder, dated the Closing Date and the Option Closing Date,
as the case may be, addressed to the Underwriters in form and substance
satisfactory to Vinson & Elkins L.L.P., counsel to the Underwriters, to the
effect that:
(i) The Corporate Stockholder has full right, power and
authority to enter into and perform its obligations under the Power of
Attorney and Custody Agreement to be executed and delivered by it in
connection with the transactions contemplated herein; the Power of
Attorney and Custody Agreement has been duly authorized by the
Corporate Stockholder; the Power of Attorney and the Custody
Agreement has been duly executed and delivered by or on behalf of the
Corporate Stockholder; and the Power of Attorney and the Custody
Agreement of the Corporate Stockholder constitutes the valid and
binding agreement of the Corporate Stockholder, enforceable in
accordance with its terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency, reorganization,
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<PAGE> 21
moratorium or other similar laws relating to or affecting creditors'
rights generally or by general equitable principles.
(ii) The Corporate Stockholder has full right, power and
authority to enter into and to perform its obligations under this
Agreement and to sell, transfer, assign and deliver the Shares to be
sold by the Corporate Stockholder hereunder.
(iii) This Agreement has been duly authorized by the
Corporate Stockholder and has been duly executed and delivered by or
on behalf of the Corporate Stockholder and, assuming due
authorization, execution and delivery by the Underwriters, is a valid
and binding agreement of the Corporate Stockholder, enforceable in
accordance with its terms, except insofar as the indemnification and
contribution provisions hereunder may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating
to or affecting creditors' rights generally or by general equitable
principles.
(iv) Upon the delivery and payment for the Shares as
contemplated in this Agreement, each of the Underwriters will receive
valid title to the Shares purchased by it from the Corporate
Stockholder, free and clear of any pledge, lien, security interest,
encumbrance, claim or equitable interest. In rendering such opinion,
such counsel may assume that the Underwriters are without notice of
any defect in the title of any of the Corporate Stockholder's Shares
being purchased from the Corporate Stockholder.
Such opinion shall be to such further effect with respect to other
legal matters relating to this Agreement and contain only those qualifications
as Vinson & Elkins L.L.P., counsel to the Underwriters, may reasonably request
or allow.
(d) The Representatives shall have received from Vinson & Elkins
L.L.P., counsel to the Underwriters, an opinion dated the Closing Date,
substantially to the effects specified in subparagraph (iii) and (iv) of
paragraph (b) of this Section 6, and that the Company is a validly organized
and existing corporation under the laws of the State of Texas. In rendering
such opinion, Vinson & Elkins L.L.P., may rely as to all matters governed other
than by Federal law on the opinions of counsel referred to in paragraphs (b)
and (c) of this Section 6. In addition to the matters set forth above, such
opinion shall also include a statement to the effect that nothing has come to
the attention of such counsel which leads them to believe that the Registration
Statement or any amendment thereto at the time the Registration Statement or
amendment became effective or the Preliminary Prospectus, any Integrated
Prospectus, or the Prospectus or any amendment or supplement thereto as of
their respective dates contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, not misleading (except that such counsel need express no
view as to financial statements, schedules and other financial or statistical
information included therein).
(e) The Representatives shall have received at or prior to the
Closing Date from Vinson & Elkins L.L.P., a memorandum or summary, in form and
substance satisfactory to the Representatives, with respect to the
qualification or exemption therefrom for offering and sale by the Underwriters
of the Shares under the State securities or Blue Sky laws of such jurisdictions
as the Representatives may reasonably have designated.
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<PAGE> 22
(f) The Representatives shall have received on the Closing Date
and on the Option Closing Date, as the case may be, signed letters from KPMG
Peat Marwick, addressed to the Underwriters dated as of the Effective Date and
again dated as of the Closing Date and as of the Option Closing Date, as the
case may be, with respect to the financial statements and certain financial and
statistical information contained in the Registration Statement, any Integrated
Prospectus and the Prospectus. All such letters shall be in form and substance
satisfactory to the Representatives and Vinson & Elkins L.L.P., counsel to the
Underwriters.
(g) The Representatives shall have received on the Closing Date
and on the Option Closing Date, as the case may be, a certificate or
certificates of the President and Chief Executive Officer and Executive Vice
President, Finance, of the Company to the effect that, as of the Closing Date
and on the Option Closing Date, as the case may be, each of them severally
represents as follows:
(i) the representations and warranties of the Company in
this Agreement are true and correct on and as of the Closing Date and
on the Option Closing Date, as the case may be, and (ii) the Company
has complied with all of its agreements and covenants and has
satisfied all of the conditions on its part to be performed or
satisfied at or prior to the Closing Date and at or prior to the
Option Closing Date, as the case may be.
(h) The Representatives shall have received a lock-up agreement
substantially in the form attached hereto as Exhibit "A" signed by each of the
Company's executive officers and directors and the Stockholders.
(i) The Company and the Stockholders shall have furnished to the
Representatives such additional information and further certificates and
documents confirming the representations and warranties contained herein and
related matters as the Representatives may reasonably have requested.
(j) Since the respective dates as of which information is given in
the Prospectus, there shall not have been any Material Adverse Change.
(k) The Shares shall have been approved for trading on the
American Stock Exchange.
(l) The Representatives shall have received from Stockholders a
certificate or certificates, dated as of the Closing Date, to the effect that
as of such date, each of them severally represent as follows:
(i) The representations and warranties of the
Stockholders in this Agreement are true and correct as of the Closing
Date; and
(ii) The Stockholders have in all material respects
complied with all the agreements and have satisfied all of the
conditions on their part to be performed or satisfied at or prior to
the Closing Date.
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<PAGE> 23
The opinions and certificates mentioned in this Agreement shall be
deemed to be in compliance with the provisions hereof only if they are in all
material respects satisfactory to the Representatives and Vinson & Elkins
L.L.P., counsel for the Underwriters.
If any of the conditions hereinabove provided for in this Section 6
shall not have been fulfilled when and as required by this Agreement to be
fulfilled, the obligations of the Underwriters hereunder may be terminated by
the Representatives by notifying the Company of such termination in writing or
by confirmed telefax at or prior to the Closing Date. In such event, the
Company, the Stockholders and the Underwriters shall not be under any
obligation to each other (except to the extent provided in Sections 5 and 8
hereof).
7. CONDITIONS OF THE OBLIGATIONS OF THE COMPANY. The obligations
of the Company and the Stockholders to sell and deliver the Shares are subject
to the conditions that (a) at or before 11:00 a.m., central daylight time, on
the date of this Agreement, or such later time and date as the Company and the
Representatives may from time to time consent to in writing or by confirmed
telefax, the Registration Statement shall have become effective, and (b) at the
Closing Date no stop order suspending the effectiveness of the Registration
Statement shall have been issued or proceedings therefore initiated or
threatened. If either of the Conditions hereinabove provided for in this
Section 7 shall not have been fulfilled when and as required by this Agreement
to be fulfilled, this Agreement may be terminated by the Company or the
Stockholders by notifying the Representatives of such termination in writing or
by confirmed telefax at or prior to the Closing Date.
8. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of the Act, the Rules and the Exchange Act, from and against any and
all losses, claims, damages, liabilities, joint or several, and all expenses
(including costs of investigation and legal expenses) to which such Underwriter
or such controlling person may become subject under the Act or otherwise,
insofar as such losses, claims, damages, liabilities or expenses (or actions or
proceedings in respect thereof) arise out of or are based upon any breach of
any representation, warranty, agreement, or covenant of the Company, or any
untrue statement or alleged untrue statement of any material fact contained in
the Registration Statement, any Integrated Prospectus, any Preliminary
Prospectus, the Prospectus or any amendment or supplement thereto, 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 not misleading; and the Company will reimburse each Underwriter and
each such controlling person for legal and other expenses incurred in
connection with investigating or defending any such loss, claim, damage,
liability, action or proceeding; provided, however, that the Company will not
be liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement, or alleged untrue
statement, or omission or alleged omission made in the Registration Statement,
any Integrated Prospectus, any Preliminary Prospectus, the Prospectus, or such
amendment or supplement, in reliance upon and in conformity with written
information furnished to the Company by or through the Representatives
specifically for use in the preparation thereof. This indemnity agreement will
be in addition to any liability which the Company may otherwise have.
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<PAGE> 24
(b) Each Stockholder severally and not jointly agrees to indemnify
and hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of the Act, the Rules and the Exchange Act from
and against any and all losses, claims, damages, liabilities, joint or several,
and all expenses (including costs of investigation and legal expenses) to which
such Underwriter or such controlling person may become subject under the Act or
otherwise, insofar as such losses, claims, damages, liabilities or expenses (or
actions or proceedings in respect thereof) arise out of or are based upon any
breach of any representation, warranty, agreement, or covenant such
Stockholder, or any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, any Integrated
Prospectus, any Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto, 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 not misleading; and the Stockholders
will reimburse each Underwriter and each such controlling person for legal and
other expenses incurred in connection with investigating or defending any such
loss, claim, damage, liability, action or proceeding; provided, however, that a
Stockholder will be liable in any such case only to the extent that such untrue
statement, or alleged untrue statement, or omission or alleged omission has
been made in the Registration Statement, any Integrated Prospectus, any
Preliminary Prospectus, the Prospectus, or such amendment or supplement, in
reliance upon and in conformity with written information furnished to the
Company by or through such Stockholder specifically for use in the preparation
thereof. This indemnity agreement will be in addition to any liability which
the Stockholders may otherwise have.
Notwithstanding anything herein to the contrary, any amounts payable
by the Stockholders pursuant to the indemnification and contribution provisions
set forth in this Section 8 shall be limited to an amount not exceeding the net
proceeds received by such Stockholder from the sale of Shares hereunder.
(c) Each Underwriter severally, but not jointly, will indemnify
and hold harmless the Company, each of its directors, each of its officers who
have signed the Registration Statement and any Integrated Prospectus, the
Stockholders, and each person, if any, who controls the Company or any
Stockholder, within the meaning of the Act, the Rules and the Exchange Act,
from and against any losses, claims, damages, liabilities or expenses to which
the Company, the Stockholders or any such director, officer, or controlling
person may become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions or proceedings 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, any Integrated
Prospectus, any Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto, 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 not misleading in light of the
circumstances under which they were made; and will reimburse any legal or other
expenses reasonably incurred by the Company, the Stockholders or any such
director, officer, or controlling person in connection with investigating or
defending any such loss, claim, damage, liability, action or proceeding;
provided, however, that each Underwriter will be liable in such case only to
the extent that such untrue statement, or alleged untrue statement or omission
or alleged omission has been made in the Registration Statement, any Integrated
Prospectus, any Preliminary Prospectus, the Prospectus, or such amendment or
supplement, in reliance upon and in conformity with written information
furnished to the Company by or through
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<PAGE> 25
the Representatives expressly for use in the preparation thereof. This
indemnity agreement will be in addition to any liability which such Underwriter
may otherwise have.
(d) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action or proceeding, such
indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party under this Section 8, notify the indemnifying party of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party
otherwise than under this Section 8, except to the extent that the indemnifying
party is substantially prejudiced by the omission of such notification. In case
any such action or proceeding is brought against any party, and it notifies an
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein, and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof with counsel satisfactory to such indemnified party, and after notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding. Any indemnified party shall
have the right to employ separate counsel in any such action and participate in
the defense thereof, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (i) the employment of such counsel has
been specifically authorized in writing by the indemnifying party, (ii) the
indemnifying party has failed to assume the defense and employ counsel, or
(iii) the named parties to any such action (including any impleaded parties)
include such indemnified party and the indemnifying party, as the case may be,
and such indemnified party shall have been advised in writing by such counsel
that there may be one or more legal defenses available to it which are
different from or additional to those available to the indemnifying party, in
which case the indemnifying party shall not have the right to assume the
defense of such action on behalf of such indemnified party, it being
understood, however, that (A) the indemnifying party shall not, in connection
with any one such action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for such indemnified
party, which firm shall be designated in writing by the indemnified party, and
that (B) all such fees and expenses shall be reimbursed as they are incurred.
Subject to the foregoing provisions of this Section 8(d), the indemnifying
party shall not be liable for the costs and expenses of any settlement of any
action without the consent of the indemnifying party.
(e) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in this Section 8 is
for any reason held to be unavailable to an indemnified party under subsection
(a), (b) or (c) above in respect to any losses, claims, damages, liabilities or
expenses referred to therein, then each applicable indemnifying party, in lieu
of indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
liabilities and expenses (i) in such
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<PAGE> 26
proportion as is appropriate to reflect the relative benefits received by the
Company and the Stockholders on the one hand and the Underwriters on the other
hand from the offering of the Shares or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the parties in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the
Stockholders on the one hand and the Underwriters on the other hand shall be
deemed to be in the same proportion as the total proceeds from the offering
(net of underwriting discounts and commissions but before deducting expenses)
received by the Company and the Stockholders bears to the underwriting
discounts and commissions received by the Underwriters. The relative fault of a
party shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission to state
a material fact relates to information supplied by each party and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The amount paid or payable by a party as a
result of the losses, claims, damages, liabilities and expenses referred to
above shall be deemed to include any legal or other fees or expenses reasonably
incurred by such party in connection with investigating or defending any such
action or claim.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 8 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 in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 8, 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 that such
Underwriters have 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 shall be several in proportion to their respective
underwriting obligations and not joint.
(f) In any proceeding relating to the Registration Statement, any
Integrated Prospectus, any Preliminary Prospectus, the Prospectus or any
supplement or amendment thereto, each party against whom contribution may be
sought under this Section 8 hereby consents to the jurisdiction of any court
having jurisdiction over any other contributing party, agrees that process
issuing from such court may be served upon him or it by any other contributing
party and consents to the service of such process and agrees that any other
contributing party may join him or it as an additional defendant in any such
proceeding in which such other contributing party is a party.
9. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements of the Company, the
Stockholders and the officers of the Company herein or in certificates
delivered pursuant hereto, and the indemnity and contribution agreements
contained in Section 8 hereof, shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of any Underwriters
or any controlling person,
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<PAGE> 27
or by or on behalf of the Company or any of its officers, directors or
controlling persons, or the Stockholders and shall survive delivery of the
Underwritten Shares and, if appropriate, the Option Shares to the
Representatives or termination of this Agreement.
10. DEFAULT BY UNDERWRITERS. If any Underwriter shall fail to
purchase and pay for the Shares which such Underwriter has agreed to purchase
and pay for hereunder (otherwise than by reason of any default on the part of
the Company or the Stockholders), the Representatives shall use their best
efforts to procure within twenty-four hours thereafter one or more of the other
Underwriters, or any others, to purchase from the Company and the Stockholders
such amounts as may be agreed upon and upon the terms set forth herein, the
Shares which the defaulting Underwriter or Underwriters failed to purchase. If
during such twenty-four hours you, as such Representatives, shall not have
procured such other Underwriters, or any others, to purchase the Shares agreed
to be purchased by the defaulting Underwriter or Underwriters, then (a) if the
aggregate number of Shares with respect to which such default shall occur does
not exceed 10% of the Shares which the Underwriters are obligated to purchase
hereby, the other Underwriters shall be obligated, severally, in proportion to
the respective number of Shares which they are obligated to purchase hereunder,
to purchase the Shares which such defaulting Underwriter or Underwriters failed
to purchase, or (b) if the aggregate number of Shares with respect to which
such default shall occur exceeds 10% of the Company's common stock covered
hereby, the Company or you, as the Representatives of the Underwriters will
have the right, by written notice given within the next twenty-four hour period
to the parties to this Agreement, to terminate this Agreement without liability
on the part of the non-defaulting Underwriters, the Company or the Stockholders
except to the extent provided in Section 8 hereof. In the event of a default by
any Underwriter or Underwriters, as set forth in this Section 10, the time of
closing may be postponed for such period, not to exceed seven days, as you, as
the Representatives, may determine in order that the required changes in the
Registration Statement, any Integrated Prospectus, the Prospectus or in any
other documents or arrangements may be effected. The term "Underwriters"
includes any person substituted for a defaulting Underwriter. Any action taken
under Section 10 shall not relieve any defaulting Underwriter from liability in
respect of any default of such Underwriter under this Agreement.
11. NOTICES. All communications hereunder shall be in writing and,
except as otherwise provided in, will be mailed, delivered or telefaxed and
confirmed as follows: if to the Underwriters, c/o the Representatives as
follows: to Stephens Inc., 111 Center Street, Little Rock, Arkansas 72201,
Attention: Michael R. Smith, Sr., with a copy to Robert H. Whilden, Jr., Vinson
& Elkins L.L.P., 2300 First City Tower, 1001 Fannin, Houston, Texas 77002-6760;
if to the Company, Benchmark Electronics, Inc., 3000 Technology Dr., Angleton,
Texas 77515, Attention: Donald E. Nigbor, with a copy to Bracewell & Patterson
L.L.P., 711 Louisiana St., Suite 2900, Houston, Texas 77002-2781, Attention:
John R. Brantley; if to the Corporate Stockholder, Mason & Hanger Corporation,
2355 Harrodsburg Road, Lexington, Kentucky 40507, Attention: Lisa Underwood,
with a copy to Sloan & Garrett, 250 W. Main Street, Lexington, Kentucky 40507,
Attention: Laurel Garrett.
12. TERMINATION. This Agreement may be terminated by notice to the
Company as follows:
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<PAGE> 28
(a) at any time prior to the earlier of (i) the time the
Shares are released by you for sale by notice to the Underwriters, or
(ii) twenty-four (24) hours following the time at which the
Registration Statement becomes effective;
(b) at any time prior to the Closing Date if any of the
following has occurred: (i) since the respective dates as of which
information is given in the Registration Statement, any Integrated
Prospectus and the Prospectus, any Material Adverse Change which
would, in the Representatives' reasonable judgment, materially impair
the investment quality of the Shares, (ii) any outbreak of hostilities
or other national or international calamity or crisis or change in
economic or political conditions if the effect of such outbreak,
calamity, crisis or change on the financial markets of the United
States would, in the Representatives' reasonable judgment, make the
offering or delivery of the Shares impracticable, (iii) suspension of
trading or general trading halts in securities on the New York Stock
Exchange, the American Stock Exchange, The Nasdaq National Market or
the over-the-counter market or limitation on prices (other than
limitations on hours or numbers of days of trading) for securities on
either such Exchange, The Nasdaq National Market or the
over-the-counter market, (iv) the enactment, publication, decree or
other promulgation of any federal or state statute, regulation, rule
or order of any court or other governmental authority which in the
Representatives' reasonable opinion materially and adversely affects
or will materially or adversely affect the business or operations of
the Company, (v) declaration of a banking moratorium by either federal
or state authorities, or (vi) the taking of any action by any federal,
state or local government or agency in respect of its monetary or
fiscal affairs which in the Representatives' reasonable opinion has a
material adverse effect on the securities markets in the United
States; or
(c) as provided in Sections 6 and 10 of this Agreement.
13. INFORMATION FURNISHED BY UNDERWRITERS. The information set
forth in the Prospectus: (a) in the last paragraph on the cover page, (b) on
page 2 regarding stabilization, and (c) (i) in the table under the caption
"Underwriting" on page 29, listing the Underwriters and the number of shares
each has agreed to purchase, and (ii) in the first paragraph below said table
on page 29, relating to the concession to dealers and the reallowance to
certain other dealers under the caption "Underwriting" in the Prospectus,
constitute the written information furnished by or on behalf of any
Underwriters referred to in paragraph (a) (v) of Section 1 hereof and in
paragraphs (a) and (b) of Section 8 hereof.
14. SUCCESSORS. This Agreement has been and is made solely for the
benefit of the Underwriters, the Company, the Stockholders and their respective
successors, executors, administrators, heirs, and assigns, and the officers,
directors and controlling persons referred to herein, and no other person will
have any right or obligation hereunder The term "successors" shall not include
any purchaser of the Shares merely because of such purchase.
15. MISCELLANEOUS. The reimbursement, indemnification and
contribution agreements contained in this Agreement and the representations,
warranties and covenants of the Company and the Stockholders in this Agreement
shall remain in full force and effect regardless of (a) any
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<PAGE> 29
termination of this Agreement, (b) any investigation made by or on behalf of
the Underwriters or controlling person or (c) delivery of any payment for the
Shares under this Agreement.
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
This Agreement shall be governed by, and construed in accordance with,
the laws of the State of Texas, without giving effect to the choice of law or
conflict of law principles thereof.
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<PAGE> 30
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company and the several
Underwriters in accordance with its terms.
Very truly yours,
BENCHMARK ELECTRONICS, INC.
By:
-------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
SELLING STOCKHOLDERS:
MASON & HANGER CORPORATION
By:
-------------------------------------
Name:
Title:
----------------------------------------
Donald E. Nigbor
----------------------------------------
Cary T. Fu
The foregoing Underwriting Agreement
is hereby confirmed and accepted as of
the date first above written.
STEPHENS INC.
J.C. BRADFORD & CO.
WHEAT, FIRST SECURITIES, INC.
By:
-----------------------------------
Stephens Inc. Senior Manager
Name:
---------------------------------
Title:
--------------------------------
As Representative of the several Underwriters
named in Schedule I hereto
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<PAGE> 31
SCHEDULE I
Name No. of Underwritten Shares
Stephens Inc.
J.C. Bradford & Co.
Wheat, First Securities, Inc.
Total
-----------------------------
1,300,000
=========
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<PAGE> 1
EXHIBIT 5
October 25, 1996
Benchmark Electronics, Inc.
3000 Technology Drive
Angleton, Texas 77515
Ladies and Gentlemen:
We have acted as counsel to Benchmark Electronics, Inc., a Texas corporation
(the "Company"), in connection with the proposed public offering by the Company
of 1,000,000 shares (1,187,500 shares, if the Underwriters exercise their
over-allotment option in full) of its common stock, par value $0.10 per share
("Common Stock") for its account (the "Company Shares"), and 250,000 shares for
the account of certain selling shareholders (the "Shareholder Shares"),
pursuant to the Registration Statement on Form S-3 (Registration No.
333-12901), as amended (the "Registration Statement"), filed under the
Securities Act of 1933, as amended, with the Securities and Exchange Commission
(the "Commission").
We have examined originals or copies certified to our satisfaction of (a) the
Restated Articles of Incorporation of the Company, (b) the Amended and
Restated Bylaws of the Company, (c) certain resolutions adopted by the Board of
Directors of the Company, and (d) such other documents and records as we have
deemed necessary and relevant for the purposes hereof. In addition, we have
relied on certificates of officers of the Company and certificates of public
officials and others as to certain matters of fact relating to this opinion and
have made such investigations of law as we have deemed necessary and relevant
as a basis hereof. We have assumed the genuineness of all signatures, the
authenticity of all documents and records submitted to us as originals, the
conformity to authentic original documents and records of all documents and
records submitted to us as copies, and the truthfulness of all statements of
fact contained therein.
Based on the foregoing, subject to the limitations set forth herein, and having
due regard for such legal considerations as we deem relevant, we are of the
opinion that (i) the Shareholder Shares are, and when sold as described in the
Registration Statement will be, validly issued, fully paid and nonassessable
and (ii) the Company Shares, when issued and delivered by the
<PAGE> 2
Benchmark Electronics, Inc.
October 25, 1996
Page 2
Company against payment of the consideration therefor as described in the
Registration Statement, will be validly issued, fully paid and
nonassessable.
This opinion is based on and is limited to the law of the State of Texas and
the relevant law of the United States of America, and we render no opinion with
respect to the law of any other jurisdiction. This opinion is solely for your
benefit and may not be relied on by or furnished to any other person.
We hereby consent to the filing of this opinion with the Commission as an
exhibit to the Registration Statement and to all references to our firm
therein; provided, however, that in giving such consent we do not admit that we
come within the category of persons whose consent is required under Section 7
of the Securities Act of 1933 or the Rules and Regulations of the Securities
and Exchange Commission.
Very truly yours,
Bracewell & Patterson, L.L.P.
