Exhibit 10.1

CARBO CERAMICS INC.

$75,000,000

COMMON STOCK

SALES AGREEMENT

July 28, 2016

 

Cowen and Company, LLC

599 Lexington Avenue

New York, New York 10022

 

Ladies and Gentlemen:

 

CARBO Ceramics Inc., a Delaware corporation (the “Company”) confirms its
agreement (this “Agreement”) with Cowen and Company, LLC (“Cowen”), as follows:

1.  Issuance and Sale of Shares.  The Company agrees that, from time to time
during the term of this Agreement, on the terms and subject to the conditions
set forth herein, it may issue and sell through Cowen, acting as agent and/or
principal, shares (the “Placement Shares”) of the Company’s common stock, par
value $0.01 per share (the “Common Stock”), having an aggregate offering price
of up to $75,000,000.  Notwithstanding anything to the contrary contained
herein, the parties hereto agree that compliance with the limitation set forth
in this Section 1 on the number of shares of Common Stock issued and sold under
this Agreement shall be the sole responsibility of the Company, and Cowen shall
have no obligation in connection with such compliance.  The issuance and sale of
Common Stock through Cowen will be effected pursuant to the Registration
Statement (as defined below) filed by the Company and declared effective by the
Securities and Exchange Commission (the “Commission”), although nothing in this
Agreement shall be construed as requiring the Company to use the Registration
Statement (as defined below) to issue the Common Stock.    

2.  The Company has filed with the Commission, in accordance with the provisions
of the Securities Act of 1933, as amended, and the rules and regulations
thereunder (collectively, the “Securities Act”), a registration statement on
Form S-3 (File No. 333-211519), including a base prospectus, relating to certain
securities, including the Placement Shares, to be issued from time to time by
the Company, and which incorporates by reference documents that the Company has
filed or will file in accordance with the provisions of the Securities Exchange
Act of 1934, as amended, and the rules and regulations thereunder (collectively,
the “Exchange Act”). The Company has prepared a prospectus supplement,
specifically relating to the Placement Shares (the “Prospectus Supplement”), to
the base prospectus included as part of such registration statement.  The
Company has furnished to Cowen, for use by Cowen, copies of the prospectus
included as part of such registration statement, as supplemented by the
Prospectus Supplement, relating to the Placement Shares.  Except where the
context otherwise requires, such registration statement, as amended when it
became effective, including all documents filed as part thereof or

 

--------------------------------------------------------------------------------

 

incorporated by reference therein, and including any information contained in a
Prospectus (as defined below) subsequently filed with the Commission pursuant to
Rule 424(b) under the Securities Act or deemed to be part of such registration
statement pursuant to Rules 430B or 462(b) of the Securities Act, is herein
called the “Registration Statement.”  The base prospectus, including all
documents incorporated therein by reference, included in the Registration
Statement, as it may be supplemented by the Prospectus Supplement, in the form
in which such prospectus and/or Prospectus Supplement have most recently been
filed by the Company with the Commission pursuant to Rule 424(b) under the
Securities Act, together with any “issuer free writing prospectus,” as defined
in Rule 433 of the Securities Act regulations (“Rule 433”), relating to the
Placement Shares that (a) is required to be filed with the Commission by the
Company or (b) is exempt from filing pursuant to Rule 433(d)(5)(i), in each case
in the form filed or required to be filed with the Commission or, if not
required to be filed, in the form retained in the Company’s records pursuant to
Rule 433(g), is herein called the “Prospectus.” Any reference herein to the
Registration Statement, the Prospectus or any amendment or supplement thereto
shall be deemed to refer to and include the documents incorporated by reference
therein, and any reference herein to the terms “amend,” “amendment” or
“supplement” with respect to the Registration Statement or the Prospectus shall
be deemed to refer to and include the filing after the execution hereof of any
document with the Commission deemed to be incorporated by reference therein. For
purposes of this Agreement, all references to the Registration Statement, the
Prospectus or to any amendment or supplement thereto shall be deemed to include
any copy filed with the Commission pursuant to the Electronic Data Gathering
Analysis and Retrieval System (“EDGAR”). 

3.  Placements.  

(a) Each time that the Company wishes to issue and sell the Placement Shares
hereunder (each, a “Placement”), it will notify Cowen by email notice (or other
method mutually agreed to in writing by the parties) (a “Placement Notice”)
containing the parameters in accordance with which it desires the Placement
Shares to be sold, which shall at a minimum include (i) the number of Placement
Shares to be issued, (ii) the time period during which such sales are requested
to be made, (iii) any limitations on the number of such Placement Shares that
may be sold in any one Trading Day (as defined below) and (iv) any minimum price
below which such sales may not be made, a form of which containing such minimum
sales parameters necessary is attached hereto as Schedule 1.  The Placement
Notice shall originate from any of the individuals from the Company set forth on
Schedule 2 (with a copy to each of the other individuals from the Company listed
on such schedule), and shall be addressed to each of the individuals from Cowen
set forth on Schedule 2, as such schedule may be amended from time to time. The
Placement Notice shall be effective upon receipt by Cowen unless and until (i)
in accordance with the notice requirements set forth in Section 5, Cowen
declines to accept the terms contained therein for any reason, in its sole
discretion, (ii) the entire amount of the Placement Shares have been sold,
(iii) in accordance with the notice requirements set forth in Section 5, the
Company suspends or terminates the Placement Notice, (iv) the Company issues a
subsequent Placement Notice with parameters superseding those on the earlier
dated Placement Notice or (v) the Agreement has been terminated under the
provisions of Section 12.   The amount of any discount, commission or other
compensation to be paid by the Company to Cowen in connection with the sale of
the Placement Shares shall be calculated in accordance with the terms set forth
in Schedule 3.  It is expressly acknowledged and agreed that neither the Company
nor Cowen will have any

2

 

--------------------------------------------------------------------------------

 

obligation whatsoever with respect to a Placement or any Placement Shares unless
and until the Company delivers a Placement Notice to Cowen and Cowen does not
decline such Placement Notice pursuant to the terms set forth above, and then
only upon the terms specified therein and herein.  In the event of a conflict
between the terms of this Agreement and the terms of a Placement Notice, the
terms of the Placement Notice will control.  

4.  Sale of Placement Shares by Cowen.  Subject to the terms and conditions
herein set forth, upon the Company’s delivery of a Placement Notice, and unless
the sale of the Placement Shares described therein has been declined, suspended
or otherwise terminated in accordance with the terms of this Agreement, Cowen,
for the period specified in the Placement Notice, will use its commercially
reasonable efforts consistent with its normal trading and sales practices and
applicable state and federal laws, rules and regulations and the rules of the
New York Stock Exchange (the “NYSE”) to sell such Placement Shares up to the
amount specified, and otherwise in accordance with the terms of such Placement
Notice.  Cowen will provide written confirmation to the Company (including by
email correspondence to each of the individuals of the Company set forth on
Schedule 2, if receipt of such correspondence is actually acknowledged by any of
the individuals to whom the notice is sent, other than via auto-reply) no later
than the opening of the Trading Day (as defined below) immediately following the
Trading Day on which it has made sales of Placement Shares hereunder, setting
forth (a) the number of Placement Shares sold on such day, (b) the
volume-weighted average price of the Placement Shares sold and (c) the Net
Proceeds (as defined below) payable to the Company. Subject to the terms of the
Placement Notice (as amended, if applicable), Cowen may sell Placement Shares by
any method permitted by law deemed to be an “at the market” offering as defined
in Rule 415(a)(5) of the Securities Act, including without limitation sales made
through NYSE, on any other existing trading market for the Common Stock or to,
or through, a market maker.  If expressly authorized by the Company in a
Placement Notice, Cowen may also sell Placement Shares in negotiated
transactions.  Cowen shall not purchase Placement Shares for its own account as
principal unless expressly authorized to do so by the Company in a Placement
Notice.  The Company acknowledges and agrees that (a) there can be no assurance
that Cowen will be successful in selling Placement Shares and (b) Cowen will
incur no liability or obligation to the Company or any other person or entity if
Cowen does not sell Placement Shares for any reason other than a failure by
Cowen to use its commercially reasonable efforts consistent with its normal
trading and sales practices to sell such Placement Shares as required under this
Section 4.  For the purposes hereof, “Trading Day” means any day on which the
Company’s Common Stock is purchased and sold on the principal market on which
the Common Stock is listed or quoted.

5.  Suspension of Sales.  

(a)The Company or Cowen may, upon notice to the other party in writing
(including by email correspondence to each of the individuals of the other party
set forth on Schedule 2, if receipt of such correspondence is actually
acknowledged by any of the individuals to whom the notice is sent, other than
via auto-reply) or by telephone (confirmed immediately by verifiable facsimile
transmission or email correspondence to each of the individuals of the other
party set forth on Schedule 2), suspend any sale of Placement Shares; provided,
however, that such suspension shall not affect or impair either party’s
obligations with respect to any Placement Shares sold hereunder prior to the
receipt of such notice.  Each of the parties agrees that no such

3

 

--------------------------------------------------------------------------------

 

notice under this Section 5 shall be effective against the other unless it is
made to one of the individuals named on Schedule 2 hereto, as such schedule may
be amended from time to time. 

(b)Notwithstanding any other provision of this Agreement, during any period in
which the Company is in possession of material non-public information, the
Company shall not request the sale of any Placement Shares.

 

6.  Settlement.

(a) Settlement of Placement Shares.  Unless otherwise specified in the
applicable Placement Notice, settlement for sales of Placement Shares will occur
on the third (3rd) Trading Day (or such earlier day as is industry practice for
regular-way trading) following the date on which such sales are made (each, a
“Settlement Date” and the first such settlement date, the “First Delivery
Date”).  The amount of proceeds to be delivered to the Company on a Settlement
Date against receipt of the Placement Shares sold (the “Net Proceeds”) will be
equal to the aggregate sales price received by Cowen at which such Placement
Shares were sold, after deduction for (i) Cowen’s commission, discount or other
compensation for such sales payable by the Company pursuant to Section 3 hereof,
(ii) any other amounts due and payable by the Company to Cowen hereunder
pursuant to Section 8(f) (Expenses) hereof, and (iii) any transaction fees
imposed by any governmental or self-regulatory organization in respect of such
sales.  

(b) Delivery of Placement Shares.  On or before each Settlement Date, the
Company will, or will cause its transfer agent to, electronically transfer the
Placement Shares being sold by crediting Cowen’s or its designee’s account
(provided Cowen shall have given the Company written notice of such designee
prior to the Settlement Date) at The Depository Trust Company through its
Deposit and Withdrawal at Custodian System or by such other means of delivery as
may be mutually agreed upon by the parties hereto which in all cases shall be
freely tradeable, transferable, registered shares in good deliverable form.  On
each Settlement Date, Cowen will deliver the related Net Proceeds in same day
funds to an account designated by the Company on, or prior to, the Settlement
Date.  The Company agrees that if the Company, or its transfer agent (if
applicable), defaults in its obligation to deliver duly authorized Placement
Shares on a Settlement Date, the Company agrees that in addition to and in no
way limiting the rights and obligations set forth in Section 10 (Indemnification
and Contribution) hereto, it will (i) hold Cowen harmless against any loss,
claim, damage, or expense (including reasonable legal fees and expenses), as
incurred, arising out of or in connection with such default by the Company and
(ii) pay to Cowen any commission, discount, or other compensation to which it
would otherwise have been entitled absent such default.

7.  Representations and Warranties of the Company.  The Company represents and
warrants to, and agrees with, Cowen that as of (a) the date of this Agreement,
(b) each Representation Date (as defined in Section 8(l)), (c) each date on
which a Placement Notice is given and (d) any date on which Placement Shares are
sold hereunder:

(a) Compliance with Registration Requirements.  The Registration Statement and
any Rule 462(b) Registration Statement have been declared effective by the
Commission under the Securities Act.  The Company has complied to the
Commission’s satisfaction with all requests of

4

 

--------------------------------------------------------------------------------

 

the Commission for additional or supplemental information.  No stop order
suspending the effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement is in effect and no proceedings for such purpose have
been instituted or are pending or, to the best knowledge of the Company,
contemplated or threatened by the Commission.  The Company meets the
requirements for use of Form S‑3 under the Securities Act.  The sale of the
Placement Shares hereunder meets the requirements or General Instruction I.B.1
of Form S-3. 

(b)  No Misstatement or Omission.  The Prospectus when filed complied and, as
amended or supplemented, if applicable, will comply in all material respects
with the Securities Act.  Each of the Registration Statement, any Rule 462(b)
Registration Statement, the Prospectus and any post-effective amendments or
supplements thereto, at the time it became effective or its date, as applicable,
complied and, as of each of the Settlement Dates, if any, will comply in all
material respects with the Securities Act and, as of its date, did not and, as
of each Settlement Date, if any, did not and will not contain any 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. The
representations and warranties set forth in the two immediately preceding
sentences do not apply to statements in or omissions from the Registration
Statement, any Rule 462(b) Registration Statement, or any post-effective
amendment thereto, or the Prospectus, or any amendments or supplements thereto,
made in reliance upon and in conformity with information relating to Cowen
furnished to the Company in writing by Cowen expressly for use therein.  There
are no contracts or other documents required to be described in the Prospectus
or to be filed as exhibits to the Registration Statement which have not been
described or filed as required.

(c) Offering Materials Furnished to Cowen. The Company has delivered to Cowen
one complete copy of the Registration Statement and a copy of each consent and
certificate of experts filed as a part thereof, and conformed copies of the
Registration Statement (without exhibits) and the Prospectus, as amended or
supplemented, in such quantities and at such places as Cowen has reasonably
requested.

(d) The Company has been duly incorporated and is validly existing as a
corporation and in good standing under the laws of the State of Delaware and has
corporate power and authority to own, lease and operate its properties and to
conduct its business as described in the Prospectus and to enter into and
perform its obligations under this Agreement. The Company is duly qualified as a
foreign corporation to transact business and is in good standing in the State of
Texas and each other jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct of
business, except where the failure to be so qualified or in good standing could
not, in the aggregate, reasonably be expected to (i) have a material adverse
effect on the condition (financial or otherwise), results of operations,
stockholders’ equity, properties or business of the Company and its subsidiaries
taken as a whole (“Material Adverse Effect”) or (ii) subject the Company to any
material liability or disability. The Company has all corporate power and
authority, as applicable, necessary to own or hold its properties and to conduct
the businesses in which it is engaged in all material respects as described in
the Registration Statement and the Prospectus.  Except as described in the
Prospectus, all of the issued and outstanding equity interests of the
Significant Subsidiary have been duly authorized and validly issued, are fully
paid and nonassessable and are owned by the Company free and clear of any
security interest, mortgage, pledge, lien, encumbrance or claim.

5

 

--------------------------------------------------------------------------------

 

The Company does not own or control, directly or indirectly, any corporation,
association or other entity other than the subsidiaries listed in Exhibit 21.1
to the Company’s Annual Report on Form 10-K for the most recently ended fiscal
year and other than (i) those subsidiaries not required to be listed on
Exhibit 21.1 by Item 601 of Regulation S-K under the Exchange Act and (ii) those
subsidiaries formed since the last day of the most recently ended fiscal
year.               

(e) The Organizational Documents have been duly authorized, executed and
delivered, by the Company. “Organizational Documents” shall mean the charter,
bylaws or other organizational document, as applicable, of the Company and its
subsidiaries, as amended from time to time and in effect as of the date hereof.

(f) The Company has all requisite corporate power and authority, as applicable,
to execute, deliver and perform its respective obligations under this Agreement.
This Agreement has been duly and validly authorized, executed and delivered by
the Company.

(g) There are no preemptive rights or other rights to subscribe for or to
purchase, nor any restriction upon the voting or transfer of, any equity
securities of the Company other than as described in the Registration Statement
and the Prospectus. Neither the filing of the Registration Statement nor the
offering or sale of the Placement Shares as contemplated by this Agreement gives
rise to any rights for or relating to the registration of any shares of Common
Stock or other securities of the Company, except such rights as have been waived
or satisfied. Except as described in the Registration Statement and the
Prospectus, there are no outstanding options or warrants to purchase any shares
of Common Stock or other equity interests in the Company.

(h) The offering and sale of the Placement Shares by the Company, the execution,
delivery and performance of this Agreement by the Company and the consummation
of the transactions contemplated hereby will not (i) conflict with or result in
a breach or violation of any of the terms or provisions of, impose any lien,
charge or encumbrance upon any property or assets of the Company and its
subsidiaries, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement, license, lease or other agreement or instrument to which
the Company or any of its subsidiaries is a party or by which the Company or any
of its subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, except for such liens, charges,
encumbrances or defaults as would not, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Change; (ii) result in
any violation of the provisions of the Organizational Documents; or (iii) result
in any violation of any statute or any judgment, order, decree, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of its subsidiaries or any of their properties or assets,
except for such violations as would not, individually or in the aggregate,
reasonably be expected to result in a Material Adverse Change.

(i) No consent, approval, authorization or order of, or filing, registration or
qualification with, any court or governmental agency or body having jurisdiction
over the Company or any of its subsidiaries or any of their properties or assets
is required for the offer and sale of the Placement Shares, the execution,
delivery and performance of this Agreement by the Company or the consummation of
the transactions contemplated hereby, except for the registration of the
Placement Shares under the Securities Act and such consents, approvals,
authorizations, orders, filings, registrations or qualifications (i) as may be
required under the Exchange Act, applicable

6

 

--------------------------------------------------------------------------------

 

state securities laws or the by-laws in connection with the purchase and sale of
the Placement Shares by Cowen, (ii) as have been, or prior to the First Delivery
Date will be, obtained or (iii) that, if not obtained, would not reasonably be
expected to have a Material Adverse Effect or materially impair the ability of
the Company to consummate the transactions contemplated by this Agreement.

(j) The historical financial statements (including the related notes and
supporting schedules) included or incorporated by reference in the Prospectus
comply as to form in all material respects with the requirements of Regulation
S-X under the Securities Act and present fairly in all material respects the
financial condition, results of operations and cash flows of the entities
purported to be shown thereby at the dates and for the periods indicated and
have been prepared in conformity with accounting principles generally accepted
in the United States applied on a consistent basis throughout the periods
indicated, except to the extent disclosed therein.

(k) Ernst & Young LLP, who have certified certain financial statements of the
Company, whose reports appear in or are incorporated by reference in the
Prospectus and who have delivered the initial letter referred to in Section 8(n)
hereof, are independent public accountants as required by the Securities Act.

(l) The Company maintains a system of internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in accordance
with management’s general or specific authorization, (ii) transactions are
recorded as necessary to permit preparation of the financial statements of the
Company in conformity with accounting principles generally accepted in the
United States and to maintain accountability for its assets, (iii) access to the
assets of the Company is permitted only in accordance with management’s general
or specific authorization and (iv) the recorded accountability for the assets of
the Company is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences. As of the date of
the most recent balance sheet of the Company and its consolidated subsidiaries
reviewed or audited by Ernst & Young LLP, there were no material weaknesses in
the internal controls of the Company.

(m) (i) To the extent required by Rule 13a-15 under the Exchange Act, the
Company maintains disclosure controls and procedures (as such term is defined in
Rule 13a-15(e) under the Exchange Act), (ii) such disclosure controls and
procedures are designed to ensure that the information required to be disclosed
by the Company is accumulated and communicated to management of the Company and
its subsidiaries, including their respective principal executive officers and
principal financial officers, as appropriate and (iii) to the extent required by
Rule 13a-15 under the Exchange Act, such disclosure controls and procedures are
effective in all material respects to perform the functions for which they were
established.

(n) Since the date of the most recent balance sheet of the Company and its
consolidated subsidiaries reviewed or audited by Ernst & Young LLP, (i) the
Company has not been advised of or become aware of (A) any significant
deficiencies in the design or operation of internal controls that are reasonably
likely to adversely affect the ability of the Company or any of its subsidiaries
to record, process, summarize and report financial data, (B) any material
weakness in internal controls or (C) any fraud, whether or not material, that
involves management or other

7

 

--------------------------------------------------------------------------------

 

employees who have a significant role in the internal controls of the Company
and its subsidiaries; and (ii) there have been no significant changes in
internal controls or in other factors that are reasonably likely to materially
affect internal controls, including any corrective actions with regard to
significant deficiencies and material weaknesses.

(o) There is not, and has not been, any failure on the part of the Company to
comply in all material respects with any provision of the Sarbanes-Oxley Act of
2002 and the rules and regulations promulgated in connection therewith.

(p) Except as described in the Prospectus or in the documents incorporated by
reference therein, since the date of the latest audited financial statements
incorporated by reference in the Prospectus, the Company has not (i) sustained
any loss or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, (ii) issued or granted any
securities, other than pursuant to the Company’s long-term incentive plan as in
effect on the date hereof, (iii) incurred any material liability or obligation,
direct or contingent, other than liabilities and obligations that were incurred
in the ordinary course of business or (iv) entered into any material transaction
not in the ordinary course of business, and since such date, there has not been
any change in corporate interests of the Company or any adverse change, or any
development involving a prospective adverse change, in or affecting the
condition (financial or otherwise), results of operations, properties,
management or business of the Company and its subsidiaries taken as a whole, in
each case except as could not, in the aggregate, reasonably be expected to have
a Material Adverse Effect.

(q) The Company and its subsidiaries have such permits, licenses, patents,
franchises, certificates of need and other approvals or authorizations of
governmental or regulatory authorities (“Permits”) as are necessary under
applicable law to own their properties and conduct their businesses in the
manner described in the Prospectus, except for any of the foregoing that could
not, in the aggregate, reasonably be expected to have a Material Adverse Effect
or except as described in the Prospectus. The Company and its subsidiaries have
fulfilled and performed all of their obligations with respect to the Permits,
and no event has occurred that allows, or after notice or lapse of time would
allow, revocation or termination thereof or results in any other impairment of
the rights of the holder or any such Permits, except for any of the foregoing
that could not reasonably be expected to have a Material Adverse Effect or
except as described in the Prospectus. Neither the Company nor any of its
subsidiaries has received notice of any revocation or modification of any such
Permits or has any reason to believe that any such Permits will not be renewed
in the ordinary course except in each case, that, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect.

(r) Intellectual Property.  The Company and its subsidiaries own or possess the
valid right to use all (i) patents, patent applications, trademarks, trademark
registrations, service marks, service mark registrations, Internet domain name
registrations, copyrights, copyright registrations, licenses and trade secret
rights (“Intellectual Property Rights”) and (ii) inventions, software, works of
authorships, trademarks, service marks, trade names, databases, formulae, know
how, Internet domain names and other intellectual property (including trade
secrets and other unpatented and/or unpatentable proprietary confidential
information, systems or procedures) (collectively, “Intellectual Property
Assets”) necessary to conduct their

8

 

--------------------------------------------------------------------------------

 

respective businesses as currently conducted, and as proposed to be conducted
and described in the Prospectus, except to the extent that the failure to own or
possess rights to use such Intellectual Property Rights or Intellectual
Property Assets would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. The Company and its subsidiaries
have not received any opinion from their legal counsel concluding that any
activities of their respective businesses infringe, misappropriate, or otherwise
violate, valid and enforceable Intellectual Property Rights of any other person,
and have not received written notice of any challenge, which is to their
knowledge still pending, by any other person to the rights of the Company and
its subsidiaries with respect to any Intellectual Property Rights or
Intellectual Property Assets owned or used by the Company or its
subsidiaries.  To the knowledge of the Company, the Company and its
subsidiaries’ respective businesses as now conducted do not give rise to any
infringement of, any misappropriation of, or other violation of, any valid and
enforceable Intellectual Property Rights of any other person. All licenses for
the use of the Intellectual Property Rights described in the Prospectus are
valid, binding upon, and enforceable by or against the parties thereto in
accordance to its terms. The Company has complied in all material respects with,
and is not in breach nor has received any asserted or threatened claim of breach
of any Intellectual Property license, and the Company has no knowledge of any
breach or anticipated breach by any other person to any Intellectual Property
license. Except as described in the Prospectus or as would not be reasonably
expected to result in a Material Adverse Effect, no claim has been made against
the Company alleging the infringement by the Company of any patent, trademark,
service mark, trade name, copyright, trade secret, license in or other
intellectual property right or franchise right of any person.  The Company has
taken all reasonable steps to protect, maintain and safeguard its Intellectual
Property Rights, including the execution of appropriate nondisclosure and
confidentiality agreements.  The consummation of the transactions contemplated
by this Agreement will not result in the loss or impairment of or payment of any
additional amounts with respect to, nor require the consent of any other person
in respect of, the Company's right to own, use, or hold for use any of the
Intellectual Property Rights as owned, used or held for use in the conduct of
the business as currently conducted.  

(s) Except as described in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is a party
or of which any property or assets of the Company or any of its subsidiaries is
the subject that could, in the aggregate, reasonably be expected to have a
Material Adverse Effect or could, in the aggregate, reasonably be expected to
have a Material Adverse Effect on the performance of this Agreement or the
consummation of the transactions contemplated hereby; and to the Company’s
knowledge, no such proceedings are threatened by governmental authorities or
others.

(t) There are no legal or governmental proceedings pending or, to the knowledge
of the Company, threatened, against the Company, or to which the Company is a
party, or to which any of its properties is subject, that are required to be
described in the Registration Statement or the Prospectus or the documents
incorporated by reference therein but are not described as required.

(u) There are no contracts or other documents required to be described in the
Registration Statement or the Prospectus or filed as exhibits to the
Registration Statement or any document incorporated by reference in the
Registration Statement that are not described and filed as required. The
statements made or incorporated by reference in the Prospectus, insofar as they
purport to constitute summaries of the terms of the contracts and other
documents described and

9

 

--------------------------------------------------------------------------------

 

filed, constitute accurate summaries of the terms of such contracts and
documents in all material respects. The Company has no knowledge that the other
parties to any such contract or other document have any intention not to render
full performance as contemplated by the terms thereof.

(v) The Company and its subsidiaries carry, or are covered by, insurance from
insurers of recognized financial responsibility in such amounts and covering
such risks as is reasonably adequate for the conduct of their respective
businesses and the value of their respective properties and as is customary for
companies engaged in similar businesses in similar industries. All policies of
insurance of the Company and its subsidiaries are in full force and effect; the
Company and its subsidiaries are in compliance with the terms of such policies
in all material respects; and neither the Company nor any of its subsidiaries
has received notice from any insurer or agent of such insurer that capital
improvements or other expenditures are required or necessary to be made in order
to continue such insurance; there are no claims by the Company or any of its
subsidiaries under any such policy or instruments as to which any insurance
company is denying liability or defending under a reservation of rights clause
that if not paid could reasonably be expected to result in a Material Adverse
Effect; and neither the Company nor any of its subsidiaries has any reason to
believe that it will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage from similar insurers
as may be necessary to continue their business at a cost that could not
reasonably be expected to have a Material Adverse Effect.

(w) No relationship, direct or indirect, exists between or among the Company, on
the one hand, and the directors, officers, shareholders, customers or suppliers
of the Company, on the other hand, that is required to be described in the
Prospectus which is not so described.

(x) Except as described in the Prospectus, no labor disturbance by or dispute
with the employees of the Company or any of its subsidiaries exists or, to the
knowledge of the Company, is imminent that could reasonably be expected to have
a Material Adverse Effect.

(y) Neither the Company nor any of its subsidiaries (i) are in violation of
their organizational documents, (ii) are in default, and no event has occurred
that, with notice or lapse of time or both, would constitute such a default, in
the due performance or observance of any term, covenant, condition or other
obligation contained in any indenture, mortgage, deed of trust, loan agreement,
license or other agreement or instrument to which they are a party or by which
they are bound or to which any of their properties or assets is subject or (iii)
are (or, to the knowledge of the Company with respect to non-U.S. subsidiaries,
are) in violation of any statute or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over any of them or their
property or assets or has failed to obtain any license, permit, certificate,
franchise or other governmental authorization or permit necessary to the
ownership of their property or to the conduct of their business, except in the
case of clauses (ii) and (iii), to the extent any such conflict, breach,
violation or default could not, in the aggregate, reasonably be expected to have
a Material Adverse Effect.

(z) Except as otherwise described in the Prospectus, and except as would not,
individually or in the aggregate, reasonably be expected to result in a Material
Adverse Change, the Company and each of its subsidiaries (i) are in compliance
with all laws, regulations,

10

 

--------------------------------------------------------------------------------

 

ordinances, rules, orders, judgments, decrees, permits or other legal
requirements of any governmental authority, including without limitation any
international, foreign, federal, state, provincial, regional or local authority,
relating to the protection of human health or safety, the environment, or
natural resources, or the use, handling, storage, manufacturing, transportation,
treatment, discharge, disposal or release of hazardous or toxic substances or
wastes, pollutants or contaminants (“Environmental Laws”) applicable to such
entity, which compliance includes, without limitation, obtaining, maintaining
and complying with all permits and authorizations and approvals required by
Environmental Laws to conduct their respective businesses, and (ii) have not
received notice or otherwise have knowledge of any actual or alleged violation
of Environmental Laws, or of any actual or potential liability for or other
obligation concerning the presence, disposal or release of hazardous or toxic
substances or wastes, pollutants or contaminants, except in the case of clause
(i) or (ii) where such non-compliance, violation, liability, or other obligation
could not, in the aggregate, reasonably be expected to have a Material Adverse
Effect. Except as described in the Prospectus, (x) there are no proceedings that
are pending, or known to be contemplated, against the Company or any of its
subsidiaries under Environmental Laws in which a governmental authority is also
a party, other than such proceedings regarding which it is reasonably believed
no monetary sanctions of $100,000 or more will be imposed, (y) the Company and
its subsidiaries are not aware of any issues regarding compliance with
Environmental Laws, including any pending or proposed Environmental Laws, or
liabilities or other obligations under Environmental Laws or concerning
hazardous or toxic substances or wastes, pollutants or contaminants, that could
reasonably be expected to have a material effect on the capital expenditures,
earnings or competitive position of the Company and its subsidiaries, and (z)
the Company does not anticipate material capital expenditures relating to
Environmental Laws. The terms “hazardous wastes”, “toxic wastes” and “hazardous
substances” shall have the meanings specified in any applicable local, state,
federal and foreign laws or regulations with respect to environmental
protection.

(aa)  The Company has filed all federal, state, local and foreign tax returns
required to be filed through the date hereof, subject to permitted extensions,
and have paid all taxes due, and no tax deficiency has been determined adversely
to the Company, nor does the Company have any knowledge of any tax deficiencies
that have been, or could reasonably be expected to be asserted against the
Company or any of its subsidiaries, that could, in the aggregate, reasonably be
expected to have a Material Adverse Effect.

(bb) Except as would not have a Material Adverse Effect:  (i) each “employee
benefit plan” (within the meaning of Section 3(3) of the Employee Retirement
Security Act of 1974, as amended (“ERISA”)) for which the Company or any member
of its “Controlled Group” (defined as any organization which is a member of a
controlled group of corporations within the meaning of Section 414 of the
Internal Revenue Code of 1986, as amended (the “Code”)) would have any liability
(each a “Plan”) has been maintained in material compliance with its terms and
with the requirements of all applicable statutes, rules and regulations
including ERISA and the Code; (ii) no prohibited transaction, within the meaning
of Section 406 of ERISA or Section 4975 of the Code, has occurred with respect
to any Plan for which the Company or any member of its Controlled Group would
have any liability, excluding transactions effected pursuant to a statutory or
administrative exemption; (iii) with respect to each Plan subject to Title IV of
ERISA (A) no “reportable event” (within the meaning of Section 4043(c) of ERISA)
has occurred or is reasonably expected to occur, (B) no “accumulated funding
deficiency” (within

11

 

--------------------------------------------------------------------------------

 

the meaning of Section 302 of ERISA or Section 412 of the Code), whether or not
waived, has occurred or is reasonably expected to occur, (C) the fair market
value of the assets under each Plan exceeds the present value of all benefits
accrued under such Plan (determined based on those assumptions used to fund such
Plan), and (D) neither the Company or any member of its Controlled Group has
incurred, or reasonably expects to incur, any liability under Title IV of ERISA
(other than contributions to the Plan or premiums to the Pension Benefit
Guaranty Corporation in the ordinary course) in respect of a Plan (including a
“multiemployer plan,” within the meaning of Section 4001(c)(3) of ERISA); and
(iv) each Plan that is intended to be qualified under Section 401(a) of the Code
is so qualified and nothing has occurred, whether by action or by failure to
act, which would cause the loss of such qualification.

(cc) The statistical and market-related data included in the Prospectus are
based on or derived from sources that the Company believes to be reliable in all
material respects.

(dd) The Company is not, and after giving effect to the offer and sale of the
Placement Shares and the application of the proceeds therefrom as described
under “Use of Proceeds” in the Prospectus, will not be (i) an “investment
company” or a company “controlled” by an “investment company” within the meaning
of the Investment Company Act of 1940, as amended (the “Investment Company
Act”), and the rules and regulations of the Commission thereunder, or (ii) a
“business development company” (as defined in Section 2(a)(48) of the Investment
Company Act).

(ee) The Company currently is not an “ineligible issuer,” as defined in Rule 405
of the rules and regulation of the Commission.  The Company agrees to notify
Cowen promptly upon the Company becoming an “ineligible issuer.”

(ff) The statements set forth in each of the Prospectus under the captions
“Description of the Common Stock,” “U.S. Federal Income Tax Considerations” and
“Plan of Distribution” insofar as they purport to summarize the provisions of
the laws referred to therein, are accurate summaries in all material respects.

(gg) Except as described in the Registration Statement and the Prospectus, there
are no contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Securities Act with respect to any securities
of the Company owned or to be owned by such person or to require the Company to
include such securities in the securities registered pursuant to the
Registration Statement or in any securities being registered pursuant to any
other registration statement filed by the Company under the Securities Act.

(hh) Except as described in the Registration Statement and the Prospectus, the
Company is not a party to any contract, agreement or understanding with any
person (other than this Agreement) that would give rise to a valid claim against
any of them or Cowen for a brokerage commission, finder’s fee or like payment in
connection with the offering and sale of the Placement Shares.

12

 

--------------------------------------------------------------------------------

 

(ii) The Company has not sold or issued any securities that would be integrated
with the offering of the Placement Shares contemplated by this Agreement
pursuant to the Securities Act or the interpretations thereof by the Commission.

(jj) The Company and its affiliates have not taken, directly or indirectly, any
action designed to or that has constituted or that could reasonably be expected
to cause or result in the stabilization or manipulation of the price of any
security of the Company in connection with the offering of the Placement Shares.

(kk) The Common Stock is listed on The New York Stock Exchange.

(ll) The Company has not distributed and, prior to the later to occur of the
Settlement Date and completion of the distribution of the Placement Shares, will
not distribute any offering material in connection with the offering and sale of
the Placement Shares other than the Prospectus and any issuer free writing
prospectus to which Cowen have consented in accordance with Section 8(a).

(mm) Neither the Company nor any of its subsidiaries is in violation of or has
received notice of any violation with respect to any federal or state law
relating to discrimination in the hiring, promotion or pay of employees, nor any
applicable federal or state wage and hour laws, nor any state law precluding the
denial of credit due to the neighborhood in which a property is situated, the
violation of any of which could reasonably be expected to have a Material
Adverse Effect.

(nn) None of the Company, nor any officer, employee or other person acting on
behalf of the Company, has (i) used any corporate funds for any material
unlawful contribution, gift, entertainment or other material unlawful expense
relating to political activity; (ii) made any direct or indirect material
unlawful payment to any foreign or domestic government official or employee from
corporate funds; (iii) violated or is in violation of any provision of the U.S.
Foreign Corrupt Practices Act of 1977; or (iv) made any material bribe or
kickback. The Company and its affiliates have instituted and maintain and will
continue to maintain policies and procedures designed to promote compliance with
such laws and with the representation and warranty contained herein.

(oo) The operations of the Company are and have been conducted at all times in
material compliance with applicable financial recordkeeping and reporting
requirements of the Currency and Foreign Transactions Reporting Act of 1970 (the
“BSA”), as amended, the money laundering statutes of all jurisdictions, the
rules and regulations thereunder and any related or similar rules, regulations
or guidelines, issued, administered or enforced by any governmental agency
(collectively, the “Money Laundering Laws”) and no action, suit or proceeding by
or before any court or governmental agency, authority or body or any arbitrator
involving the Company or any of its subsidiaries with respect to the Money
Laundering Laws is pending.  The Company is not aware of any subpoenas being
issued to the Company or any of its employees by any government agency seeking
records pursuant to the government’s administrative subpoena power under the
BSA.

13

 

--------------------------------------------------------------------------------

 

(pp) (i) Neither the Company nor any officer, agent, employee, director or
affiliate of the Company is (a) a person with whom dealings are prohibited under
any U.S. sanctions (“Sanctions”) administered by the Office of Foreign Assets
Control of the U.S. Treasury Department (“OFAC”) including but not limited to
any person identified on the OFAC Specially Designated Nationals list and any
such person (a “Sanctioned Person”) nor (b) located, organized or resident in a
country or territory that is the subject of Sanctions that broadly prohibit or
restrict dealings in such country or territory (currently, Crimea, Cuba, Iran,
North Korea, Sudan and Syria); and (ii) the Company will not directly or
indirectly use the proceeds of the offering, or lend, contribute or otherwise
make available such proceeds to any subsidiary, joint venture partner or other
person or entity, for (a) the purpose of financing the activities of any
Sanctioned Person or (b) in any other manner, in each case as would result in a
violation of Sanctions by any person or entity (including any person or entity
participating in the offering, whether as underwriter, advisor, investor or
otherwise).

Any certificate signed by an officer of the Company and delivered to Cowen or to
counsel for Cowen shall be deemed to be a representation and warranty by the
Company to Cowen as to the matters set forth therein.

The Company acknowledges that Cowen and, for purposes of the opinions to be
delivered pursuant to Section 8 hereof, counsel to the Company and counsel to
Cowen, will rely upon the accuracy and truthfulness of the foregoing
representations and hereby consents to such reliance.

8.  Covenants of the Company.  The Company covenants and agrees with Cowen that:

(a) Registration Statement Amendments.  After the date of this Agreement and
during any period in which a Prospectus relating to any Placement Shares is
required to be delivered by Cowen under the Securities Act (including in
circumstances where such requirement may be satisfied pursuant to Rule 172 under
the Securities Act), (i) the Company will notify Cowen promptly of the time when
any subsequent amendment to the Registration Statement, other than documents
incorporated by reference, has been filed with the Commission and/or has become
effective or any subsequent supplement to the Prospectus has been filed and of
any request by the Commission for any amendment or supplement to the
Registration Statement or Prospectus or for additional information; (ii) the
Company will prepare and file with the Commission, promptly upon Cowen’s
request, any amendments or supplements to the Registration Statement or
Prospectus that, in Cowen’s reasonable opinion, may be necessary or advisable in
connection with the distribution of the Placement Shares by Cowen (provided,
however, that the failure of Cowen to make such request shall not relieve the
Company of any obligation or liability hereunder, or affect Cowen’s right to
rely on the representations and warranties made by the Company in this
Agreement); (iii) the Company will not file any amendment or supplement to the
Registration Statement or Prospectus, other than documents incorporated by
reference, relating to the Placement Shares or a security convertible into the
Placement Shares unless a copy thereof has been submitted to Cowen within a
reasonable period of time before the filing and Cowen has not reasonably
objected thereto (provided, however, that the failure of Cowen to make such
objection shall not relieve the Company of any obligation or liability
hereunder, or affect Cowen’s right to rely on the representations and warranties
made by the Company in this Agreement, and provided further, however, that the
Company shall not be required to provide

14

 

--------------------------------------------------------------------------------

 

Cowen with any copy of any such document in advance if the filing does not name
Cowen, does not relate to the transactions contemplated by this Agreement or is
being filed in connection with a separate offering pursuant to the same
Registration Statement) and the Company will furnish to Cowen at the time of
filing thereof a copy of any document that upon filing is deemed to be
incorporated by reference into the Registration Statement or Prospectus, except
for those documents available via EDGAR; and (iv) the Company will cause each
amendment or supplement to the Prospectus, other than documents incorporated by
reference, to be filed with the Commission as required pursuant to the
applicable paragraph of Rule 424(b) of the Securities Act.  

(b) Notice of Commission Stop Orders.  The Company will advise Cowen, promptly
after it receives notice or obtains knowledge thereof, of the issuance or
threatened issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement, of the suspension of the
qualification of the Placement Shares for offering or sale in any jurisdiction,
or of the initiation or threatening of any proceeding for any such purpose; and
it will promptly use its commercially reasonable efforts to prevent the issuance
of any stop order or to obtain its withdrawal if such a stop order should be
issued.

(c) Delivery of Prospectus; Subsequent Changes.  During any period in which a
Prospectus relating to the Placement Shares is required to be delivered by Cowen
under the Securities Act with respect to a pending sale of the Placement Shares,
(including in circumstances where such requirement may be satisfied pursuant to
Rule 172 under the Securities Act), the Company will comply with all
requirements imposed upon it by the Securities Act, as from time to time in
force, and to file on or before their respective due dates all reports and any
definitive proxy or information statements required to be filed by the Company
with the Commission pursuant to Sections 13(a), 13(c), 14, 15(d) or any other
provision of or under the Exchange Act.  If during such period any event occurs
as a result of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the circumstances then
existing, not misleading, or if during such period it is necessary to amend or
supplement the Registration Statement or Prospectus to comply with the
Securities Act, the Company will promptly notify Cowen to suspend the offering
of Placement Shares during such period and the Company will promptly amend or
supplement the Registration Statement or Prospectus (at the expense of the
Company) so as to correct such statement or omission or effect such compliance,
provided, however, that the Company may elect in its sole discretion to delay
the filing of any such amendment or supplement to the Registration Statement if
it determines it is in the best interest of the Company to do so.

(d) Listing of Placement Shares.  During any period in which the Prospectus
relating to the Placement Shares is required to be delivered by Cowen under the
Securities Act with respect to a pending sale of the Placement Shares (including
in circumstances where such requirement may be satisfied pursuant to Rule 172
under the Securities Act), the Company will use its commercially reasonable
efforts to cause the Placement Shares to be listed on the NYSE and to qualify
the Placement Shares for sale under the securities laws of such jurisdictions as
Cowen reasonably designates and to continue such qualifications in effect so
long as required for the distribution of the Placement Shares; provided,
however, that the Company shall not be

15

 

--------------------------------------------------------------------------------

 

required in connection therewith to qualify as a foreign corporation or dealer
in securities or file a general consent to service of process in any
jurisdiction. 

(e) Delivery of Registration Statement and Prospectus.  The Company will furnish
to Cowen and its counsel (at the expense of the Company) copies of the
Registration Statement, the Prospectus (including all documents incorporated by
reference therein) and all amendments and supplements to the Registration
Statement or Prospectus that are filed with the Commission during any period in
which a Prospectus relating to the Placement Shares is required to be delivered
under the Securities Act (including all documents filed with the Commission
during such period that are deemed to be incorporated by reference therein), in
each case as soon as reasonably practicable and in such quantities as Cowen may
from time to time reasonably request and, at Cowen’s request, will also furnish
copies of the Prospectus to each exchange or market on which sales of the
Placement Shares may be made; provided, however, that the Company shall not be
required to furnish any document (other than the Prospectus) to Cowen to the
extent such document is available on EDGAR.  

(f) Expenses.  The Company, whether or not the transactions contemplated
hereunder are consummated or this Agreement is terminated, in accordance with
the provisions of Section 11 hereunder, will pay the following expenses all
incident to the performance of its obligations hereunder, including, but not
limited to, expenses relating to (i) the preparation, printing and filing of the
Registration Statement and each amendment and supplement thereto, of each
Prospectus and of each amendment and supplement thereto, (ii) the preparation,
issuance and delivery of the Placement Shares, (iii) the qualification of the
Placement Shares under securities laws in accordance with the provisions of
Section 8(d) of this Agreement, including filing fees (provided, however, that
any fees or disbursements of counsel for Cowen in connection therewith shall be
paid by Cowen except as set forth in (vii) below), (iv) the printing and
delivery to Cowen of copies of the Prospectus and any amendments or supplements
thereto, and of this Agreement, (v) the fees and expenses incurred in connection
with the listing or qualification of the Placement Shares for trading on the
NYSE, (vi) the filing fees and expenses, if any, of the Commission, and (vii)
the reasonable fees and disbursements of Cowen’s counsel in an amount not to
exceed $50,000.

(g) Use of Proceeds.  The Company will use the Net Proceeds as described in the
Prospectus in the section entitled “Use of Proceeds.”

(h) Notice of Other Sales.  During the pendency of any Placement Notice given
hereunder, and for five (5) trading days following the termination of any
Placement Notice given hereunder, the Company shall provide Cowen notice as
promptly as reasonably possible before it offers to sell, contracts to sell,
sells, grants any option to sell or otherwise disposes of any shares of Common
Stock (other than Placement Shares offered pursuant to the provisions of this
Agreement) or securities convertible into or exchangeable for Common Stock,
warrants or any rights to purchase or acquire Common Stock; provided, that such
notice shall not be required in connection with the (i) issuance, grant or sale
of Common Stock, options to purchase shares of Common Stock or Common Stock
issuable upon the exercise of options or other equity awards pursuant to any
stock option, stock bonus or other stock plan or arrangement described in the
Prospectus, (ii) the issuance of securities in connection with an acquisition,
merger or sale or purchase of assets, (iii) the issuance or sale of Common Stock
pursuant to any dividend

16

 

--------------------------------------------------------------------------------

 

reinvestment plan that the Company may adopt from time to time provided the
implementation of such is disclosed to Cowen in advance or (iv) any shares of
Common Stock issuable upon the exchange, conversion or redemption of securities
or the exercise of warrants, options or other rights in effect or outstanding.

(i) Change of Circumstances.  The Company will, at any time during a fiscal
quarter in which the Company intends to tender a Placement Notice or sell
Placement Shares, advise Cowen promptly after it shall have received notice or
obtained knowledge thereof, of any information or fact that would alter or
affect in any material respect any opinion, certificate, letter or other
document provided to Cowen pursuant to this Agreement.

(j) Due Diligence Cooperation.  The Company will cooperate with any reasonable
due diligence review conducted by Cowen or its agents in connection with the
transactions contemplated hereby, including, without limitation, providing
information and making available documents and senior corporate officers, during
regular business hours and at the Company’s principal offices, as Cowen may
reasonably request.

(k) Required Filings Relating to Placement of Placement Shares.  The Company
agrees that on such dates as the Securities Act shall require, the Company will
(i) file a prospectus supplement with the Commission under the applicable
paragraph of Rule 424(b) under the Securities Act (each and every filing under
Rule 424(b), a “Filing Date”), which prospectus supplement will set forth,
within the relevant period, the amount of Placement Shares sold through Cowen,
the Net Proceeds to the Company and the compensation payable by the Company to
Cowen with respect to such Placement Shares provided that the Company may
satisfy this requirement by reporting such information in its filings made under
the Exchange Act, and (ii) deliver such number of copies of each such prospectus
supplement to each exchange or market on which such sales were effected as may
be required by the rules or regulations of such exchange or market.

(l) Representation Dates; Certificate.  On or prior to the First Delivery Date
and each time the Company (i) files the Prospectus relating to the Placement
Shares or amends or supplements the Registration Statement or the Prospectus
relating to the Placement Shares (other than a prospectus supplement filed in
accordance with Section 8(k) of this Agreement) by means of a post-effective
amendment, sticker, or supplement but not by means of incorporation of
document(s) by reference to the Registration Statement or the Prospectus
relating to the Placement Shares; (ii) files an annual report on Form 10-K under
the Exchange Act; (iii) files its quarterly reports on Form 10-Q under the
Exchange Act; or (iv) files a report on Form 8-K containing amended financial
information (other than an earnings release) under the Exchange Act (each date
of filing of one or more of the documents referred to in clauses (i) through
(iv) shall be a “Representation Date”); the Company shall furnish Cowen with a
certificate, in the form attached hereto as Exhibit 8(l) within three (3)
Trading Days of any Representation Date if requested by Cowen.  The requirement
to provide a certificate under this Section 8(l) shall be waived for any
Representation Date occurring at a time at which no Placement Notice is pending,
which waiver shall continue until the earlier to occur of the date the Company
delivers a Placement Notice hereunder (which for such calendar quarter shall be
considered a Representation Date) and the next occurring Representation Date;
provided, however, that such waiver shall not apply for any Representation Date
on which the Company files its annual report

17

 

--------------------------------------------------------------------------------

 

on Form 10-K.  Notwithstanding the foregoing, if the Company subsequently
decides to sell Placement Shares following a Representation Date when the
Company relied on such waiver and did not provide Cowen with a certificate under
this Section 8(l), then before the Company delivers the Placement Notice or
Cowen sells any Placement Shares, the Company shall provide Cowen with a
certificate, in the form attached hereto as Exhibit 8(l), dated the date of the
Placement Notice. 

(m) Legal Opinion.  On or prior to the First Delivery Date and within three (3)
Trading Days of each Representation Date with respect to which the Company is
obligated to deliver a certificate in the form attached hereto as Exhibit 8(l)
for which no waiver is applicable, the Company shall cause to be furnished to
Cowen a written opinion of Cleary, Gottlieb, Steen & Hamilton LLP (“Company
Counsel”), or other counsel satisfactory to Cowen, in form and substance
satisfactory to Cowen and its counsel, dated the date that the opinion is
required to be delivered, substantially similar to the form attached hereto as
Exhibit 8(m)(i) and Exhibit 8(m)(ii), respectively, modified, as necessary, to
relate to the Registration Statement and the Prospectus as then amended or
supplemented; provided, however, that in lieu of such opinions for subsequent
Representation Dates, counsel may furnish Cowen with a letter (a “Reliance
Letter”) to the effect that Cowen may rely on a prior opinion delivered under
this Section 8(m) to the same extent as if it were dated the date of such letter
(except that statements in such prior opinion shall be deemed to relate to the
Registration Statement and the Prospectus as amended or supplemented at such
Representation Date).  

(n) Comfort Letter.  On or prior to the date of delivery of the first Placement
Notice and within three (3) Trading Days of each Representation Date with
respect to which the Company is obligated to deliver a certificate in the form
attached hereto as Exhibit 8(l) for which no waiver is applicable, the Company
shall cause its independent accountants to furnish Cowen letters (the “Comfort
Letters”), dated the date the Comfort Letter is delivered, in form and substance
satisfactory to Cowen, (i) confirming that they are an independent registered
public accounting firm within the meaning of the Securities Act and the PCAOB,
(ii) stating, as of such date, the conclusions and findings of such firm with
respect to the financial information and other matters ordinarily covered by
accountants’ “comfort letters” to Cowen in connection with registered public
offerings (the first such letter, the “Initial Comfort Letter”) and (iii)
updating the Initial Comfort Letter with any information that would have been
included in the Initial Comfort Letter had it been given on such date and
modified as necessary to relate to the Registration Statement and the
Prospectus, as amended and supplemented to the date of such letter.

(o) Market Activities.  The Company will not, directly or indirectly, (i) take
any action designed to cause or result in, or that constitutes or might
reasonably be expected to constitute, the stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the
Placement Shares or (ii) sell, bid for, or purchase the Placement Shares to be
issued and sold pursuant to this Agreement, or pay anyone any compensation for
soliciting purchases of the Placement Shares other than Cowen; provided,
however, that the Company may bid for and purchase shares of its Common Stock in
accordance with Rule 10b-18 under the Exchange Act.

18

 

--------------------------------------------------------------------------------

 

(p) Insurance.  The Company and its subsidiaries shall maintain, or cause to be
maintained, insurance in such amounts and covering such risks as is reasonable
and customary for the business for which it is engaged. 

(q) Compliance with Laws.  The Company and each of its subsidiaries shall
maintain, or cause to be maintained, all material environmental permits,
licenses and other authorizations required by federal, state and local law in
order to conduct their businesses as described in the Prospectus, and the
Company and each of its subsidiaries shall conduct their businesses, or cause
their businesses to be conducted, in substantial compliance with such permits,
licenses and authorizations and with applicable environmental laws, except where
the failure to maintain or be in compliance with such permits, licenses and
authorizations could not reasonably be expected to result in a Material Adverse
Effect.

(r) Investment Company Act.  The Company will conduct its affairs in such a
manner so as to reasonably ensure that neither it nor its subsidiaries will be
or become, at any time prior to the termination of this Agreement, an
“investment company,” as such term is defined in the Investment Company Act,
assuming no change in the Commission’s current interpretation as to entities
that are not considered an investment company.

(s) Securities Act and Exchange Act.  The Company will use its best efforts to
comply with all requirements imposed upon it by the Securities Act and the
Exchange Act as from time to time in force, so far as necessary to permit the
continuance of sales of, or dealings in, the Placement Shares as contemplated by
the provisions hereof and the Prospectus.

(t) No Offer to Sell.  Other than a free writing prospectus (as defined in Rule
405 under the Securities Act) approved in advance by the Company and Cowen in
its capacity as principal or agent hereunder, neither Cowen nor the Company
(including its agents and representatives, other than Cowen in its capacity as
such) will make, use, prepare, authorize, approve or refer to any written
communication (as defined in Rule 405 under the Securities Act), required to be
filed with the Commission in connection with the transactions contemplated by
this Agreement, that constitutes an offer to sell or solicitation of an offer to
buy Common Stock hereunder.

(u) Sarbanes-Oxley Act.  The Company and its subsidiaries will use their best
efforts to comply with all effective applicable provisions of the Sarbanes-Oxley
Act.

9.  Conditions to Cowen’s Obligations. The obligations of Cowen hereunder with
respect to a Placement will be subject to the continuing accuracy and
completeness in all material respects (other than in the case of representations
and warranties qualified by materiality or Material Adverse Effect, in which
case, in all respects) of the representations and warranties made by the Company
herein, to the due performance by the Company of its obligations hereunder, to
the completion by Cowen of a due diligence review satisfactory to Cowen in its
reasonable judgment, and to the continuing satisfaction (or waiver by Cowen in
its sole discretion) of the following additional conditions:

(a) Registration Statement Effective.  The Registration Statement shall be
effective and shall be available for (i) all sales of Placement Shares issued
pursuant to all prior Placement

19

 

--------------------------------------------------------------------------------

 

Notices and (ii) the sale of all Placement Shares contemplated to be issued by
any Placement Notice. 

(b) No Material Notices.  None of the following events shall have occurred and
be continuing:  (i) receipt by the Company or any of its subsidiaries of any
request for additional information from the Commission or any other federal or
state governmental authority during the period of effectiveness of the
Registration Statement, the response to which would require any post-effective
amendments or supplements to the Registration Statement or the Prospectus;
(ii) the issuance by the Commission or any other federal or state governmental
authority of any stop order suspending the effectiveness of the Registration
Statement or the initiation of any proceedings for that purpose; (iii) receipt
by the Company of any notification with respect to the suspension of the
qualification or exemption from qualification of any of the Placement Shares for
sale in any jurisdiction or the initiation or threatening of any proceeding for
such purpose; or (iv) the occurrence of any event that makes any material
statement made in the Registration Statement or the Prospectus or any material
document incorporated or deemed to be incorporated therein by reference untrue
in any material respect or that requires the making of any changes in the
Registration Statement, related Prospectus or such documents so that, in the
case of the Registration Statement, it will not contain any materially untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading and,
that in the case of the Prospectus, it will not contain any materially untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.

(c) No Misstatement or Material Omission.  Cowen shall not have advised the
Company that the Registration Statement or Prospectus, or any amendment or
supplement thereto, contains an untrue statement of fact that in Cowen’s
reasonable opinion is material, or omits to state a fact that in Cowen’s opinion
is material and is required to be stated therein or is necessary to make the
statements therein not misleading.

(d) Material Changes.  Except as contemplated in the Prospectus, or disclosed in
the Company’s reports filed with the Commission, there shall not have been any
Material Adverse Effect, on a consolidated basis, in the authorized capital
stock of the Company or any Material Adverse Effect or any development that
could reasonably be expected to result in a Material Adverse Effect, or any
downgrading in or withdrawal of the rating assigned to any of the Company’s
securities (other than asset backed securities) by any rating organization or a
public announcement by any rating organization that it has under surveillance or
review its rating of any of the Company’s securities (other than asset backed
securities), the effect of which, in the case of any such action by a rating
organization described above, in the reasonable judgment of Cowen (without
relieving the Company of any obligation or liability it may otherwise have), is
so material as to make it impracticable or inadvisable to proceed with the
offering of the Placement Shares on the terms and in the manner contemplated in
the Prospectus.

(e) Company Counsel Legal Opinion.  Cowen shall have received the opinion of
Company Counsel required to be delivered pursuant to Section 8(m) on or before
the date on which such delivery of such opinion is required pursuant to Section
8(m).

20

 

--------------------------------------------------------------------------------

 

(f) Cowen’s Counsel Legal Opinion.  Cowen shall have received from Duane Morris
LLP, counsel for Cowen, such opinion or opinions, on or before the date on which
the delivery of the Company Counsel legal opinion is required pursuant to
Section 8(m), with respect to such matters as Cowen may reasonably require, and
the Company shall have furnished to such counsel such documents as they request
for enabling them to pass upon such matters. 

(g) Comfort Letter.  Cowen shall have received the Comfort Letter required to be
delivered pursuant to Section 8(n) on or before the date on which such delivery
of such Comfort Letter is required pursuant to Section 8(n).

(h)         Representation Certificate.  Cowen shall have received the
certificate required to be delivered pursuant to Section 8(l) on or before the
date on which delivery of such certificate is required pursuant to Section 8(l).

(i) Secretary’s Certificate.  On or prior to the date of delivery of the first
Placement Notice, Cowen shall have received a certificate, signed on behalf of
the Company by its corporate Secretary, in form and substance satisfactory to
Cowen and its counsel.

(j) No Suspension.  Trading in the Common Stock shall not have been suspended on
the NYSE.

(k) Securities Act Filings Made.  All filings with the Commission required by
Rule 424 under the Securities Act to have been filed prior to the issuance of
any Placement Notice hereunder shall have been made within the applicable time
period prescribed for such filing by Rule 424.

(l) Approval for Listing.  The Placement Shares shall either have been (i)
approved for listing on the NYSE, subject only to notice of issuance or (ii) the
Company shall have filed an application for listing of the Placement Shares on
the NYSE at, or prior to, the issuance of any Placement Notice.

(m) No Termination Event.  There shall not have occurred any event that would
permit Cowen to terminate this Agreement pursuant to Section 12(a).

10.  Indemnification and Contribution.

(a) Company Indemnification.  The Company agrees to indemnify and hold harmless
Cowen, the directors, officers, partners, employees and agents of Cowen and each
person, if any, who (i) controls Cowen within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, or (ii) is controlled by or is
under common control with Cowen (a “Cowen Affiliate”) from and against any and
all losses, claims, liabilities, expenses and damages (including, but not
limited to, any and all reasonable investigative, legal and other
expenses  incurred in connection with, and any and all amounts paid in
settlement (in accordance with Section 10(c)) of, any action, suit or proceeding
between any of the indemnified parties and any indemnifying parties or between
any indemnified party and any third party, or otherwise, or any claim asserted),
as and when incurred, to which Cowen, or any such person, may become subject
under the Securities Act, the Exchange Act or other federal or state statutory
law or regulation, at common law or otherwise, insofar as such losses, claims,
liabilities, expenses or damages arise

21

 

--------------------------------------------------------------------------------

 

out of or are based, directly or indirectly, on (x) any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or the Prospectus or any amendment or supplement to the Registration
Statement or the Prospectus or in any free writing prospectus or in any
application or other document executed by or on behalf of the Company or based
on written information furnished by or on behalf of the Company filed in any
jurisdiction in order to qualify the Common Stock under the securities laws
thereof or filed with the Commission, (y) the omission or alleged omission to
state in any such document a material fact required to be stated in it or
necessary to make the statements in it not misleading or (z) any breach by any
of the indemnifying parties of any of their respective representations,
warranties and agreements contained in this Agreement; provided, however, that
this indemnity agreement shall not apply to the extent that such loss, claim,
liability, expense or damage arises from the sale of the Placement Shares
pursuant to this Agreement and is caused directly or indirectly by an untrue
statement or omission made in reliance upon and in conformity with the Agent’s
Information.  This indemnity agreement will be in addition to any liability that
the Company might otherwise have. 

(b) Cowen Indemnification. Cowen agrees to indemnify and hold harmless the
Company and its directors and each officer of the Company that signed the
Registration Statement, and each person, if any, who (i) controls the Company
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act or (ii) is controlled by or is under common control with the
Company (a “Company Affiliate”) against any and all loss, liability, claim,
damage and expense described in the indemnity contained in Section 10(a), as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendments thereto) or the Prospectus (or any amendment or supplement thereto)
in reliance upon and in conformity with the Agent’s Information.

(c) Procedure.  Any party that proposes to assert the right to be indemnified
under this Section 10 will, promptly after receipt of notice of commencement of
any action against such party in respect of which a claim is to be made against
an indemnifying party or parties under this Section 10, notify each such
indemnifying party of the commencement of such action, enclosing a copy of all
papers served, but the omission so to notify such indemnifying party will not
relieve the indemnifying party from (i) any liability that it might have to any
indemnified party otherwise than under this Section 10 and (ii) any liability
that it may have to any indemnified party under the foregoing provision of this
Section 10 unless, and only to the extent that, such omission results in the
forfeiture of substantive rights or defenses by the indemnifying party. If any
such action is brought against any indemnified party and it notifies the
indemnifying party of its commencement, the indemnifying party will be entitled
to participate in and, to the extent that it elects by delivering written notice
to the indemnified party promptly after receiving notice of the commencement of
the action from the indemnified party, jointly with any other indemnifying party
similarly notified, to assume the defense of the action, with counsel reasonably
satisfactory to the indemnified party, and after notice from the indemnifying
party to the indemnified party of its election to assume the defense, the
indemnifying party will not be liable to the indemnified party for any legal or
other expenses except as provided below and except for the reasonable costs of
investigation subsequently incurred by the indemnified party in connection with
the defense. The indemnified party will have the right to employ its own counsel
in any such action, but the fees, expenses and other charges of such counsel
will be at the

22

 

--------------------------------------------------------------------------------

 

expense of such indemnified party unless (1) the employment of counsel by the
indemnified party has been authorized in writing by the indemnifying party, (2)
the indemnified party has reasonably concluded (based on advice of counsel) that
there may be legal defenses available to it or other indemnified parties that
are different from or in addition to those available to the indemnifying party,
(3) a conflict or potential conflict exists (based on advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party (in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party) or (4) the indemnifying party
has not in fact employed counsel to assume the defense of such action within a
reasonable time after receiving notice of the commencement of the action, in
each of which cases the reasonable fees, disbursements and other charges of
counsel will be at the expense of the indemnifying party or parties. It is
understood that the indemnifying party or parties shall not, in connection with
any proceeding or related proceedings in the same jurisdiction, be liable for
the reasonable fees, disbursements and other charges of more than one separate
firm admitted to practice in such jurisdiction at any one time for all such
indemnified party or parties. All such fees, disbursements and other charges
will be reimbursed by the indemnifying party promptly as they are incurred. An
indemnifying party will not, in any event, be liable for any settlement of any
action or claim effected without its written consent.  No indemnifying party
shall, without the prior written consent of each indemnified party, settle or
compromise or consent to the entry of any judgment in any pending or threatened
claim, action or proceeding relating to the matters contemplated by this Section
10 (whether or not any indemnified party is a party thereto), unless such
settlement, compromise or consent includes an unconditional release of each
indemnified party from all liability arising or that may arise out of such
claim, action or proceeding.  

(d) Contribution.  In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in the foregoing
paragraphs of this Section 10 is applicable in accordance with its terms but for
any reason is held to be unavailable from the Company or Cowen, the Company and
Cowen will contribute to the total losses, claims, liabilities, expenses and
damages (including any investigative, legal and other expenses reasonably
incurred in connection with, and any amount paid in settlement of, any action,
suit or proceeding or any claim asserted, but after deducting any contribution
received by the Company from persons other than Cowen, such as persons who
control the Company within the meaning of the Securities Act, officers of the
Company who signed the Registration Statement and directors of the Company, who
also may be liable for contribution) to which the Company and Cowen may be
subject in such proportion as shall be appropriate to reflect the relative
benefits received by the Company on the one hand and Cowen on the other. The
relative benefits received by the Company on the one hand and Cowen on the other
hand shall be deemed to be in the same proportion as the total Net Proceeds from
the sale of the Placement Shares (before deducting expenses) received by the
Company bear to the total compensation received by Cowen from the sale of
Placement Shares on behalf of the Company.  If, but only if, the allocation
provided by the foregoing sentence is not permitted by applicable law, the
allocation of contribution shall be made in such proportion as is appropriate to
reflect not only the relative benefits referred to in the foregoing sentence but
also the relative fault of the Company, on the one hand, and Cowen, on the
other, with respect to the statements or omission that resulted in such loss,
claim, liability, expense or damage, or action in respect thereof, as well as
any other relevant equitable considerations with respect to such offering. Such
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement

23

 

--------------------------------------------------------------------------------

 

of a material fact or omission or alleged omission to state a material fact
relates to information supplied by the Company or Cowen, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and Cowen agree that
it would not be just and equitable if contributions pursuant to this Section
10(d) were to be determined by pro rata allocation or by any other method of
allocation that does not take into account the equitable considerations referred
to herein. The amount paid or payable by an indemnified party as a result of the
loss, claim, liability, expense, or damage, or action in respect thereof,
referred to above in this Section 10(d) shall be deemed to include, for the
purpose of this Section 10(d), any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim to the extent consistent with Section 10(c)
hereof.  Notwithstanding the foregoing provisions of this Section 10(d), Cowen
shall not be required to contribute any amount in excess of the commissions
received by it under this Agreement and no person found guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
will be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 10(d), any person who
controls a party to this Agreement within the meaning of the Securities Act, and
any officers, directors, partners, employees or agents of Cowen, will have the
same rights to contribution as that party, and each officer of the Company who
signed the Registration Statement will have the same rights to contribution as
the Company, subject in each case to the provisions hereof. Any party entitled
to contribution, promptly after receipt of notice of commencement of any action
against such party in respect of which a claim for contribution may be made
under this Section 10(d), will notify any such party or parties from whom
contribution may be sought, but the omission to so notify will not relieve that
party or parties from whom contribution may be sought from any other obligation
it or they may have under this Section 10(d) except to the extent that the
failure to so notify such other party materially prejudiced the substantive
rights or defenses of the party from whom contribution is sought. Except for a
settlement entered into pursuant to the last sentence of Section 10(c) hereof,
no party will be liable for contribution with respect to any action or claim
settled without its written consent if such consent is required pursuant to
Section 10(c) hereof. 

11.  Representations and Agreements to Survive Delivery.  The indemnity and
contribution agreements contained in Section 9 of this Agreement and all
representations and warranties of the Company herein or in certificates
delivered pursuant hereto shall survive, as of their respective dates,
regardless of (i) any investigation made by or on behalf of Cowen, any
controlling persons, or the Company (or any of their respective officers,
directors or controlling persons), (ii) delivery and acceptance of the Placement
Shares and payment therefor or (iii) any termination of this Agreement.

12.  Termination.

(a) Cowen shall have the right by giving notice as hereinafter specified at any
time to terminate this Agreement if (i) any Material Adverse Effect, or any
development that could reasonably be expected to result in a Material Adverse
Effect has occurred that, in the reasonable judgment of Cowen, may materially
impair the ability of Cowen to sell the Placement Shares hereunder, (ii) the
Company shall have failed, refused or been unable to perform any agreement on
its part to be performed hereunder; provided, however, in the case of any
failure of the Company to deliver (or cause another person to deliver) any
certification, opinion, or letter

24

 

--------------------------------------------------------------------------------

 

required under Sections 8(l), 8(m), or 8(n), Cowen’s right to terminate shall
not arise unless such failure to deliver (or cause to be delivered) continues
for more than thirty (30) days from the date such delivery was required or
(iii) any other condition of Cowen’s obligations hereunder is not
fulfilled.  Any such termination shall be without liability of any party to any
other party except that the provisions of Section 8(f) (Expenses), Section 10
(Indemnification and Contribution), Section 11 (Representations and Agreements
to Survive Delivery), Section 17 (Applicable Law; Consent to Jurisdiction) and
Section 18 (Waiver of Jury Trial) hereof shall remain in full force and effect
notwithstanding such termination. If Cowen elects to terminate this Agreement as
provided in this Section 12(a), Cowen shall provide the required notice as
specified in Section 13 (Notices). 

(b) The Company shall have the right, by giving notice as hereinafter specified
to terminate this Agreement in its sole discretion at any time after the date of
this Agreement.  Any such termination shall be without liability of any party to
any other party except that the provisions of Section 8(f), Section 10, Section
11, Section 17 and Section 18 hereof shall remain in full force and effect
notwithstanding such termination.

(c) Cowen shall have the right, by giving notice as hereinafter specified to
terminate this Agreement in its sole discretion at any time after the date of
this Agreement.  Any such termination shall be without liability of any party to
any other party except that the provisions of Section 8(f), Section 10, Section
11, Section 17 and Section 18 hereof shall remain in full force and effect
notwithstanding such termination.

(d) Unless earlier terminated pursuant to this Section 12, this Agreement shall
automatically terminate upon the issuance and sale of all of the Placement
Shares through Cowen on the terms and subject to the conditions set forth
herein; provided that the provisions of Section 8(f), Section 10, Section 11,
Section 17 and Section 18 hereof shall remain in full force and effect
notwithstanding such termination.

(e) This Agreement shall remain in full force and effect unless terminated
pursuant to Sections 12(a), (b), (c) or (d) above or otherwise by mutual
agreement of the parties; provided, however, that any such termination by mutual
agreement shall in all cases be deemed to provide that Section 8(f), Section 10,
Section 11, Section 17 and Section 18 shall remain in full force and effect.

(f) Any termination of this Agreement shall be effective on the date specified
in such notice of termination; provided, however, that such termination shall
not be effective until the close of business on the date of receipt of such
notice by Cowen or the Company, as the case may be. If such termination shall
occur prior to the Settlement Date for any sale of Placement Shares, such
Placement Shares shall settle in accordance with the provisions of this
Agreement.

13.  Notices.  All notices or other communications required or permitted to be
given by any party to any other party pursuant to the terms of this Agreement
shall be in writing, unless otherwise specified in this Agreement, and if sent
to Cowen, shall be delivered to Cowen at: Cowen and Company, LLC, 599 Lexington
Avenue, New York, New York 10022, fax no. 646-562-1124, Attention:  General
Counsel, with a copy to Duane Morris LLP, Attention:  James T. Seery, e-mail
jtseery@duanemorris.com; or if sent to the Company, shall be delivered to the

25

 

--------------------------------------------------------------------------------

 

Company at:  CARBO Ceramics Inc., 575 North Dairy Ashford, Suite 300, Houston,
Texas 77079, Attention:  John R. Bakht, e-mail:  john.bakht@carboceramics.com,
with a copy to Cleary, Gottlieb, Steen & Hamilton LLP, attention:  Christopher
E. Austin, Esq., e-mail:  caustin@cgsh.com. Each party to this Agreement may
change such address for notices by sending to the parties to this Agreement
written notice of a new address for such purpose.  Each such notice or other
communication shall be deemed given (i) when delivered personally or by
verifiable facsimile transmission (with an original to follow) on or before 4:30
p.m., New York City time, on a Business Day (as defined below), or, if such day
is not a Business Day on the next succeeding Business Day, (ii) on the next
Business Day after timely delivery to a nationally-recognized overnight courier
and (iii) on the Business Day actually received if deposited in the U.S. mail
(certified or registered mail, return receipt requested, postage prepaid). For
purposes of this Agreement, “Business Day” shall mean any day on which the NYSE
and commercial banks in the City of New York are open for business. 

14.  Successors and Assigns.  This Agreement shall inure to the benefit of and
be binding upon the Company and Cowen and its respective successors and the
affiliates, controlling persons, officers and directors referred to in Section
10 hereof. References to any of the parties contained in this Agreement shall be
deemed to include the successors and permitted assigns of such party. Nothing in
this Agreement, express or implied, is intended to confer upon any party other
than the parties hereto or their respective successors and permitted assigns any
rights, remedies, obligations or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement. Neither party may
assign its rights or obligations under this Agreement without the prior written
consent of the other party; provided, however, that Cowen may assign its rights
and obligations hereunder to an affiliate of Cowen without obtaining the
Company’s consent.

15.  Adjustments for Share Splits.  The parties acknowledge and agree that all
share-related numbers contained in this Agreement shall be adjusted to take into
account any share split, share dividend or similar event effected with respect
to the Common Stock.

16.  Entire Agreement; Amendment; Severability.  This Agreement (including all
schedules and exhibits attached hereto and Placement Notices issued pursuant
hereto) constitutes the entire agreement and supersedes all other prior
agreements and undertakings, both written and oral, among the parties hereto
with regard to the subject matter hereof. Neither this Agreement nor any term
hereof may be amended except pursuant to a written instrument executed by the
Company and Cowen.  In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable as written by a court of competent
jurisdiction, then such provision shall be given full force and effect to the
fullest possible extent that it is valid, legal and enforceable, and the
remainder of the terms and provisions herein shall be construed as if such
invalid, illegal or unenforceable term or provision was not contained herein,
but only to the extent that giving effect to such provision and the remainder of
the terms and provisions hereof shall be in accordance with the intent of the
parties as reflected in this Agreement.

17.  Applicable Law; Consent to Jurisdiction. This Agreement shall be governed
by, and construed in accordance with, the internal laws of the State of New York
without regard to the principles of conflicts of laws. Each party hereby
irrevocably submits to the non-exclusive jurisdiction of the state and federal
courts sitting in the City of New York, borough of Manhattan,

26

 

--------------------------------------------------------------------------------

 

for the adjudication of any dispute hereunder or in connection with any
transaction contemplated hereby, and hereby irrevocably waives, and agrees not
to assert in any suit, action or proceeding, any claim that it is not personally
subject to the jurisdiction of any such court, that such suit, action or
proceeding is brought in an inconvenient forum or that the venue of such suit,
action or proceeding is improper.  Each party hereby irrevocably waives personal
service of process and consents to process being served in any such suit, action
or proceeding by mailing a copy thereof (certified or registered mail, return
receipt requested) to such party at the address in effect for notices to it
under this Agreement and agrees that such service shall constitute good and
sufficient service of process and notice thereof.  Nothing contained herein
shall be deemed to limit in any way any right to serve process in any manner
permitted by law. 

18.  Waiver of Jury Trial.  The Company and Cowen each hereby irrevocably waives
any right it may have to a trial by jury in respect of any claim based upon or
arising out of this Agreement or any transaction contemplated hereby.

19.  Absence of Fiduciary Relationship.  The Company acknowledges and agrees
that:

(a) Cowen has been retained solely to act as sales agent in connection with the
sale of the Common Stock and that no fiduciary, advisory or agency relationship
between the Company and Cowen has been created in respect of any of the
transactions contemplated by this Agreement, irrespective of whether Cowen has
advised or is advising the Company on other matters;

(b) the Company is capable of evaluating and understanding and understands and
accepts the terms, risks and conditions of the transactions contemplated by this
Agreement;

(c) the Company has been advised that Cowen and its affiliates are engaged in a
broad range of transactions which may involve interests that differ from those
of the Company and that Cowen has no obligation to disclose such interests and
transactions to the Company by virtue of any fiduciary, advisory or agency
relationship; and

(d) the Company waives, to the fullest extent permitted by law, any claims it
may have against Cowen, for breach of fiduciary duty or alleged breach of
fiduciary duty and agrees that Cowen shall have no liability (whether direct or
indirect) to the Company in respect of such a fiduciary claim or to any person
asserting a fiduciary duty claim on behalf of or in right of the Company,
including stockholders, partners, employees or creditors of the Company.

20.  Counterparts.  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. Delivery of an executed Agreement by one
party to the other may be made by facsimile transmission.

21.  Definitions. As used in this Agreement, the following term has the meaning
set forth below:

(a) “Applicable Time” means the date of this Agreement, each Representation
Date, the date on which a Placement Notice is given, and any date on which
Placement Shares are sold hereunder.

27

 

--------------------------------------------------------------------------------

 

(b)“Agent’s Information” means, solely the following information; the third
sentence of the eighth paragraph under the caption “Plan of Distribution” in the
Prospectus. 

 

[Remainder of Page Intentionally Blank]

 

28

 

--------------------------------------------------------------------------------

 

If the foregoing correctly sets forth the understanding between the Company and
Cowen, please so indicate in the space provided below for that purpose,
whereupon this letter shall constitute a binding agreement between the Company
and Cowen.  

Very truly yours,

 

COWEN AND COMPANY, LLC

 

 

By:  /s/ Robert Sine

Name: Robert Sine

Title: Managing Director

 

 

ACCEPTED as of the date

first-above written:

 

CARBO CERAMICS INC.

 

 

By:  /s/ Ernesto Bautista, III

Name: Ernesto Bautista, III

Title: Vice President, Chief Financial Officer

 

 

 

- 29 -

 

--------------------------------------------------------------------------------

 

SCHEDULE 1

form of PLACEMENT NOTICE

 

From:

[                              ]

Cc:

[                              ]

To:

[ ]

Subject: Cowen at the Market Offering—Placement Notice

Date:_______________, 20___

Ladies and Gentlemen:

Pursuant to the terms and subject to the conditions contained in the Sales
Agreement between CARBO Ceramics Inc., a Delaware corporation (the “Company”)
and Cowen and Company, LLC (“Cowen”) dated as of July 28, 2016 (the
“Agreement”), I hereby request on behalf of the Company that Cowen sell up to
[  ] shares of the Company’s common stock, par value $0.01 per share, at a
minimum market price of $_______ per share.  Sales should begin on the date of
this Notice and shall continue until [[●], 20[●]] / [all shares are sold].

 

 

 

--------------------------------------------------------------------------------

 

SCHEDULE 2

Notice Parties

The Company

Ernesto Bautista, III

Vice President, Chief Financial Officer

 

John R. Bakht

Vice President, General Counsel

 

 

Cowen

Robert Sine

Managing Director

 

William Follis

Director

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

SCHEDULE 3

Compensation

Cowen shall be paid compensation of up to 3% of the gross proceeds from the
sales of Common Stock pursuant to the terms of this Agreement.

 

 

 

 

--------------------------------------------------------------------------------

 

Exhibit 8(l)

 

OFFICER CERTIFICATE

 

 

The undersigned, the duly qualified and elected _______________________ of CARBO
Ceramics Inc. (the “Company”), a Delaware corporation, does hereby certify in
such capacity and on behalf of the Company, pursuant to Section 8(l) of the
sales agreement, dated as of               July 28, 2016, between the Company
and Cowen and Company, LLC (the “Sales Agreement”), that to the best of the
knowledge of the undersigned:

 

(i)The representations and warranties of the Company in Section 7 of the Sales
Agreement (A) to the extent such representations and warranties are subject to
qualifications and exceptions contained therein relating to materiality or
Material Adverse Effect, are true and correct on and as of the date hereof with
the same force and effect as if expressly made on and as of the date hereof,
except for those representations and warranties that speak solely as of a
specific date and which were true and correct as of such date, and (B) to the
extent such representations and warranties are not subject to any qualifications
or exceptions, are true and correct in all material respects as of the date
hereof as if made on and as of the date hereof with the same force and effect as
if expressly made on and as of the date hereof except for those representations
and warranties that speak solely as of a specific date and which were true and
correct as of such date; and

(ii)The Company has complied with all agreements and satisfied all conditions on
its part to be performed or satisfied pursuant to the Sales Agreement at or
prior to the date hereof.

 

CARBO CERAMICS INC.

 

 

By:

Name:

Title:

 

 

Date:

 

 

--------------------------------------------------------------------------------

 

Exhibit 8(m)(i)

Matters to be covered by initial OPINION OF

COMPANY COUNSEL

 

(i)

The Company is validly existing as a corporation in good standing under the laws
of its jurisdiction of incorporation.  

 

(ii)

The Company has corporate power to own its properties and conduct its business
as described in the Final Prospectus, including the documents incorporated by
reference therein, and the Company has corporate power to issue the Securities,
to enter into the Sales Agreement and to perform its obligations thereunder.

 

(iii)

The Securities have been duly authorized by all necessary corporate action of
the Company, and, when issued and delivered by the Company in accordance with
the terms of the Sales Agreement against payment of the consideration set forth
therein, will be validly issued by the Company, fully paid and nonassessable;
and the holders of outstanding shares of capital stock of the Company are not
entitled to any preemptive rights to subscribe for the Securities under the
Restated Certificate of Incorporation or Second Amended and Restated By‑Laws of
the Company or the Delaware General Corporation Law.

 

(iv)

The statements under the headings “Description of our Capital Stock” in the Base
Prospectus, insofar as such statements purport to summarize certain provisions
of the Securities and the Restated Certificate of Incorporation, provide a fair
summary of such provisions.

 

(v)

The execution and delivery of the Sales Agreement have been duly authorized by
all necessary corporate action of the Company, and the Sales Agreement has been
duly executed and delivered by the Company.

 

(vi)

The issuance and sale of the Securities to the Sales Agent pursuant to the Sales
Agreement do not, and the performance by the Company of its obligations in the
Sales Agreement and the Securities will not, (a) require any consent, approval,
authorization, registration or qualification of or with any governmental
authority of the United States or the State of New York that in our experience
normally would be applicable to general business entities with respect to such
issuance, sale or performance, except such as have been obtained or effected
under the Securities Act and the Securities Exchange Act of 1934, as amended
(but we express no opinion relating to any state securities or Blue Sky laws),
(b) result in a breach of any of the terms and provisions of, or constitute a
default under, any of the agreements of the Company identified in Schedule I
hereto, or a violation of the Articles of Incorporation or By‑Laws of the
Company, or (c) result in a violation of any United States federal or New York
State law or

 

--------------------------------------------------------------------------------

 

 

published rule or regulation that in our experience normally would be applicable
to general business entities with respect to such issuance, sale or performance
(but we express no opinion relating to the United States federal securities laws
or any state securities or Blue Sky laws). 

 

(vii)

The Registration Statement (except the financial statements and schedules and
other financial and statistical data included therein, as to which we express no
view), at the time it became effective, and the Final Prospectus (except as
aforesaid), as of the date hereof, appeared on their face to be appropriately
responsive in all material respects to the requirements of the Securities Act
and the rules and regulations thereunder

 

(viii)

No registration of the Company under the U.S. Investment Company Act of 1940, as
amended, is required for the offer and sale of the Securities by the Company in
the manner contemplated by the Sales Agreement and the Final Prospectus and the
application of the proceeds thereof as described in the Final Prospectus.

 

 

(ix)

The Registration Statement became effective under the Securities Act on May 31,
2016 and, to our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued under the Securities Act or proceedings
therefor initiated or threatened by the Commission.

 

(x)

Nothing has come to our attention that leads us to believe that the Registration
Statement, at the time such Registration Statement became effective and as of
the date of the Sales Agreement, 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 the Prospectus,
as of the date of the Sales Agreement or the date hereof, included or includes
an untrue statement of a material fact or omitted or omits to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading (it being understood
that we express no belief with respect to the financial statements, financial
schedules and other financial or statistical data included or incorporated by
reference in, or excluded from, the Registration Statement or the Prospectus).

 

2

--------------------------------------------------------------------------------

 

Exhibit 8(m)(ii)

 

Matters to be covered by subsequent Company Counsel Opinions

The Registration Statement, when it became effective, and the Prospectus and any
amendment or supplement thereto, on the date of filing thereof with the
Commission, appeared on their face to be appropriately responsive in all
material respects to the requirements for registration statements on Form S-3
under the Securities Act and the rules and regulations of the Commission
thereunder, and each of the documents incorporated by reference in the
Registration Statement or the Prospectus, or any amendment or supplement
thereto, on the date of filing thereof with the Commission, complied as to form
in all material respects with the requirements of the Exchange Act and the rules
and regulations of the Commission thereunder; it being understood, however, that
we express no opinion with respect to the financial statements, schedules or
other financial or statistical data included or incorporated by reference in, or
omitted from, the Registration Statement or the Prospectus or any other
document.  In passing upon the compliance as to form of the Registration
Statement and the Prospectus and any other document, we have assumed that the
statements made and incorporated by reference therein are correct and complete.

(a)The Registration Statement has become effective under the Securities Act and,
to the best of our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceeding for that purpose has
been instituted by the Commission.

In addition, we have participated in conferences with officers and other
representatives of the Company, representatives of the independent public
accountants for the Company, and your representatives, at which the contents of
the Registration Statement and the Prospectus and related matters were discussed
and, although we are not passing upon, and do not assume any responsibility for,
the accuracy, completeness or fairness of the statements contained or
incorporated by reference in the Registration Statement and the Prospectus,
during the course of such participation, no facts came to our attention that
caused us to believe that the Registration Statement, at the time it became
effective and as of the date hereof, 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 the Prospectus
(including the Incorporated Documents), as of its date and as of the date
hereof, contained an untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; it being understood
that we express no belief with respect to the financial statements, schedules
and other financial and statistical data included or incorporated by reference
in the Registration Statement or the Prospectus.

*  Note: “Registration Statement” and “Prospectus” will be defined to include
documents incorporated by reference therein (“Incorporated Documents”).