METEOR INDUSTRIES, INC.
600,000 Shares
of Common Stock
and
600,000 Redeemable Warrants
AGREEMENT AMONG UNDERWRITERS
Westport Resources Investment Services, Inc. April , 1997
000 Xxxx Xxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
As Representative
GENTLEMEN:
We wish to confirm as follows the agreement among you, the
undersigned
and the other members of the Underwriting Group named in Schedule I to the
Underwriting Agreement, as it is to be executed (all such parties being herein
called the "Underwriters"), with respect to the purchase by the Underwriters
severally from Meteor Industries, Inc. ("Company") of up to 600,000 shares of
Common Stock and up to 600,000 Redeemable Warrants ("Securities") set forth in
Schedule I to the Underwriting Agreement. The number of Securities to be
purchased by each Underwriter from the Company shall be determined in
accordance with Section 2 of the Underwriting Agreement. It is understood
that changes may be made in those who are to be Underwriters and in the
respective numbers of Securities to be purchased by them, but that the
Underwriting Agreement will not be changed without our consent, except as
provided herein, and in the Underwriting Agreement. The obligations of the
Underwriters to purchase the number of Securities set opposite their
respective names in Schedule I to the Underwriting Agreement, are herein
called their "underwriting obligations." The number of Securities set opposite
our name in said Schedule I, are herein called "our Securities." For purposes
of this Agreement the following definitions shall be applicable:
(a) "Manager's Concession" shall be the compensation to you for
acting
as Manager as provided in Paragraph 1 of not less than percent ( %)
of the underwriting discount. The Manager's Concession shall include the
right to a portion of the warrants to be issued pursuant to the Underwriting
Agreement and, the right to the nonaccountable expenses to be paid pursuant to
the Underwriting Agreement.
(b) "Underwriting Group Concession" shall mean compensation to
members
of the Underwriting Group for assuming the underwriting risk and shall be not
less than percent ( %) of the underwriting discount.
(c) "Dealer's Concession" shall mean compensation to Dealers, who
are
members of the Selling Group and shall, as to Dealers who have executed an
agreement with you, be not less than percent ( %) of the underwriting
discount.
(d) "Dealer's Reallowance Concession" shall mean the compensation
allowed Dealers by Underwriters other than you and shall be one-half (1/2) of
the Dealer's Concession.
(e) It is contemplated that the underwriting discount will be ten
percent (10%) of the offering price. You, in your absolute discretion, shall
determine, within the foregoing limitations, the precise allocation of the
underwriting discount and shall notify us of same at least twenty-four (24)
hours prior to the execution of the Underwriting Agreement.
1. AUTHORITY AND COMPENSATION OF REPRESENTATIVE. We hereby
authorize
you, as our Representative and on our behalf, (a) to enter into an agreement
with the Company substantially in the form attached hereto as Exhibit A
("Underwriting Agreement"), but with such changes therein as in your judgment
are not materially adverse to the Underwriters, (b) to exercise all the
authority and discretion vested in the Underwriters and in you by the
provisions of the Underwriting Agreement, and (c) to take all such action as
you, in your discretion, may deem necessary or advisable in order to carry out
the provisions of the Underwriting Agreement and this Agreement and the sale
and distribution of the Securities, provided, however, that the time within
which the Registration Statement is required to become effective pursuant to
the Underwriting Agreement will not be extended more than forty-eight (48)
hours without the approval of a majority in interest of the Underwriters
(including you). We authorize you, in executing the Underwriting Agreement on
our behalf, to set forth in Schedule I of the Underwriting Agreement as our
commitment to purchase the number of Securities (which shall not be
substantially in excess of the number of Securities included in your
invitation to participate unless we have agreed otherwise) included in a wire,
telex, or similar means of communication transmitted by you to us at least
twenty-four (24) hours prior to the commencement of the offering as our
finalized underwriting participation.
As our share of the compensation for your services hereunder, we will pay you,
and we authorize you to charge to our account, a sum equal to the Manager's
Concession.
2. PUBLIC OFFERING. A public offering of the Securities is to be
made, as herein provided, as soon after the Registration Statement relating
thereto shall become effective as in your judgment is advisable. The
Securities shall be initially offered to the public at the public offering
price of $ per share and $0.10 per Redeemable Warrant. You will
advise
us by telegraph or telephone when the Securities shall be released for
offering. We authorize you as Representative of the Underwriters, after the
initial public offering, to vary the public offering price, in your sole
discretion, by reason of changes in general market conditions or otherwise.
The public offering price of the Securities at any time in effect is herein
called the "Offering Price."
We hereby agree to deliver all preliminary and final Prospectuses as
required for compliance with the provisions of Rule 15c2-8 under the
Securities Exchange Act of 1934 and Section 5(b) of the Securities Act of
1933. You have heretofore delivered to us such preliminary Prospectuses as
have been requested by us, receipt of which is hereby acknowledged, and will
deliver such final Prospectuses as will be requested by us.
3. OFFERING TO DEALERS AND GROUP SALES. We authorize you to
reserve
for offering and sale, and on our behalf to sell, to institutions or other
retail purchasers (such sales being herein called "Group Sales") and to
dealers selected by you (such dealers being herein called the "Dealers") all
or any part of our Securities as you may determine. Such sales of Securities,
if any, shall be made (i) in the case of Group Sales, at the Offering Price,
and (ii) in the case of sales to Dealers, at the Offering Price less the
Dealer's Concession.
Any Group Sales shall be as nearly as practicable in proportion to
the
underwriting obligations of the respective Underwriters. Any sales to Dealers
made for our account shall be as nearly as practicable in the ratio that the
Securities reserved for our account for offering to Dealers bears to the
aggregate of all Securities of all Underwriters, including you, so reserved.
On any Group Sales or sales to Dealers made by you on our behalf, we shall be
entitled to receive only the Underwriter's Concession.
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You agree to notify us not less than twenty-four (24) hours prior to
the commencement of the public offering as to the number of Securities, if
any,
which we may retain for direct sale. Prior to the termination of this
Agreement, you may reserve for offering and sale, as herein before provided,
any Securities remaining unsold theretofore retained by us and we may, with
your consent, retain any Securities remaining unsold theretofore reserved by
you. Sales to Dealers shall be made under a Selected Dealers Agreement,
attached hereto as Exhibit B and by this reference incorporated herein. We
authorize you to determine the form and manner of any communications with
Dealers, and to make such changes in the Selected Dealers Agreement, as you
may deem appropriate. In the event that there shall be any such agreements
with Dealers, you are authorized to act as managers thereunder, and we agree,
in such event, to be governed by the terms and conditions of such agreements.
Each Underwriter agrees that it will not offer any of the Securities for sale
at a price below the Offering Price or allow any concession therefrom, except
as herein otherwise provided. We, as to our Securities, may enter into
agreements with Dealers, but any Dealer's Reallowance Concession shall not
exceed half of the Dealer's Concession.
It is understood that any person to whom an offer may be made, as
hereinbefore provided, shall be a member of the National Association of
Securities Dealers, Inc. ("NASD") or dealers or institutions with their
principal place of business located outside of the United States, its
territories or possessions, and who are not eligible for membership under
Section 1 of the Bylaws of the NASD who agree to make no sales within the
United States, its territories or possessions, or to persons who are nationals
thereof, or residents therein, and, in making sales, to comply with the NASD's
Rules of Fair Practice.
We authorize you to determine the form and manner of any public
advertisement of the Securities.
Nothing in this Agreement contained shall be deemed to restrict our
right, subject to the provisions of this Section 3, to offer our Securities
prior to the effective date of the Registration Statement, provided, however,
that any such offer shall be made in compliance with any applicable
requirements of the Securities Act of 1933 and the Securities Exchange Act of
1934 and the rules and regulations of the Securities and Exchange Commission
thereunder and of any applicable state securities laws.
4. REPURCHASES IN THE OPEN MARKET. Any Securities sold by us
(otherwise than through you) which, prior to the termination of this
Agreement, or such earlier date as you may determine, shall be contracted for
or purchased in the open market by you on behalf of any Underwriter or
Underwriters, shall be repurchased by us on demand at a price equal to the
cost of such purchase plus commissions and taxes, if any, on redelivery. Any
Securities delivered on such repurchase need not be the identical Securities
originally sold by us. In lieu of delivery of such Securities to us, you may
(i) sell such Securities in any manner for our account and charge us with the
amount of any loss or expense, or credit us with the amount of any profit,
less any expense, resulting from such sale, or (ii) charge our account . t
with an amount not in excess of the concession to Dealers on such Securities.
5. DELIVERY AND PAYMENT. We agree to deliver to you, at or before
9:00 A.M., New York, New York Time, on the Closing Date referred to in the
Underwriting Agreement, at your office, a certified or bank cashier's check
payable to your order for the offering price of the Securities less Dealer's
Concession of the Securities which we retained for direct sale by us, the
proceeds of which check shall be delivered to you, in the manner provided in
the Underwriting Agreement, to or for the account of the Company against
delivery of
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certificates for such Securities to you for our account. You are authorized
to accept such delivery and to give receipts therefor. You may advance funds
for Securities which have been sold or reserved for sale to retail purchasers
or Dealers for our account. If we fail (whether or not such failure shall
constitute a default hereunder) to deliver to you, or you fail to receive, our
check and/or payment for sales made by you for our account for the Securities
which we have agreed to purchase, you, individually and not as Representative
of the Underwriters, are authorized (but shall not be obligated) to make
payment, in the manner provided in the Underwriting Agreement, to or for the
account of the Company for such Securities for our account, but any such
payment by you shall not relieve us of any of our obligations under the
Underwriting Agreement or under this Agreement and we agree to repay you on
demand the amount so advanced for our account.
We also agree on demand to take up and pay for or to deliver to you
funds sufficient to pay for at cost any Securities of the Company purchased by
you for our account pursuant to the provisions of Section 9 hereof, and to
deliver to you on demand any Securities sold by you for our account, pursuant
to any provision of this Agreement.
We authorize you to deliver our Securities, and any other
Securities purchased by you for our account pursuant to the provisions of
Section 9 hereof, against sales made by you for our account pursuant to any
provision of this Agreement.
Upon receipt by you of payment for the Securities sold by us and/or
through you for our account, you will remit to us promptly an amount equal to
the Underwriter's Concession on such Securities. You agree to cause to be
delivered to us, as soon as practicable after the Closing Date referred to in
the Underwriting Agreement, such part of our Securities purchased on such
Closing Date as shall not have been sold or reserved for sale by your for our
account.
In case any Securities reserved for sale in Group Sales or to Dealers
shall not be purchased and paid for in due course as contemplated hereby, we
agree to accept delivery when tendered by you of any Securities so reserved
for our account and not so purchased and pay you the offering price less the
Dealer's and Underwriter's Concessions.
6. AUTHORITY TO BORROW. We authorize you to advance your funds for
our account (charging current interest rates) and to arrange loans for our
account for the purpose of carrying out this Agreement, and in connection
therewith to execute and deliver any notes or other instruments, and to hold,
or pledge as security therefor, all or any part of our Securities of the
Company purchased hereunder for our account. Any lending bank is hereby
authorized to accept your instructions as Representative in all matters
relating to such loans. Any part of our Securities held by you, may be
delivered to us for carrying purposes, and if so delivered, will be
redelivered to you upon demand.
7. ALLOCATION OF EXPENSE AND LIABILITY. We authorize you to charge
our account with, and we agree to pay (a) all transfer taxes on sales made by
you for our account, except as herein otherwise provided, and (b) our
proportionate share (based on our underwriting obligations) of all expenses in
excess of those reimbursed by the Company incurred by you in connection with
the purchase, carrying and distribution, or proposed purchase and
distribution, of the Securities and all other expenses arising under the terms
of the Underwriting Agreement or this Agreement. Your determination of all
such expenses and your allocation thereof shall be final and conclusive.
Funds for our account at any time in your hands as our Representative may be
held in your general funds
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without accountability for interest. As soon as practicable after the
termination of this Agreement, the net credit or debit balance in our account,
after proper charge and credit for all interim payments and receipts, shall be
paid to or paid by us, provided, however, that you, in your discretion, may
reserve from distribution an amount to cover possible additional expenses
chargeable to the several Underwriters.
8. LIABILITY FOR FUTURE CLAIMS. Neither any statement by you, as
Representative of the Underwriters, of any credit or debit balance in our
account nor any reservation from distribution to cover possible additional
expenses relating to the Securities shall constitute any representation by you
as to the existence or nonexistence of possible unforeseen expenses or
liabilities of or charges against the several Underwriters. Notwithstanding
the distribution of any net credit balance to us or the termination of this
Agreement, or both, we shall be and remain liable for, and will pay on demand,
(a) our proportionate share (based on our underwriting obligations) of all
expenses and liabilities which may be incurred by, or for the accounts of the
Underwriters, including any liability which may be incurred by the
Underwriters or any of them, and (b) any transfer taxes paid after such
settlement on account of any sale or transfer for our account.
9. STABILIZATION. We authorize you, until the termination of this
Agreement, (a) to make purchases and sales of the Securities, in the open
market or otherwise, for long or short account, and on such terms, and at such
prices as you in your discretion may deem desirable, (b) in arranging for
sales of Securities, to overallot, and (c) either before or after the
termination of this Agreement, to cover any short position incurred pursuant
to this Section 9; subject, however, to the applicable rules and regulations
of the Securities and Exchange Commission under the Securities Exchange Act of
1934. All such purchases, sales and overallotments shall be made for the
accounts of the several Underwriters as nearly as practicable in proportion to
their respective underwriting obligations; provided, however, that our net
position resulting from such purchases and sales and overallotments shall not
at any time exceed, either for long or short account, fifteen percent (15%) of
the number of Securities agreed to be purchased by us.
If you engage in any stabilizing transactions as representative of
the
underwriters, you shall promptly notify us of that fact and in like manner you
agree to promptly notify and file with us any stabilizing transaction in
accordance with the requirements of Rule 17a-2(d) under the Securities
Exchange Act of 1934.
We agree to advise you from time to time, upon request, until the
settlement of accounts hereunder, of the number of Securities at the time
retained by us unsold, and we will upon request sell to you, for the accounts
of one or more of the several Underwriters, such number of our unsold
Securities as you may designate, at the Offering Price less such amount, not
in excess of the concession to Dealers, as you may determine.
10. OPEN MARKET TRANSACTIONS. We agree that, except with your
consent
and except as herein provided upon advice from you, we will not make purchases
or sales on the open market or otherwise, or attempt to induce others to make
purchases or sales, either before or after the purchase of the Securities, and
prior to the completion (as defined in Regulation M of the Securities Exchange
Act of 1934) of our participation in the distribution, we will otherwise
comply with Regulation M. Nothing in this Section 10 contained shall prohibit
us from acting as broker or agent in the execution of unsolicited orders of
customers for the purchase or sale of any securities of the Company.
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11. BLUE SKY. Prior to the initial offering by the Underwriters,
you
will inform us as to the states under the respective securities or Blue Sky
laws of which it is believed that the Securities have been qualified or are
exempt for sale, but you do not assume any responsibility or obligation as to
the accuracy of such information or as to the right of any Underwriter or
Dealer to sell the Securities in any jurisdiction. We will not sell any
Securities in any other state or jurisdiction and we will not sell Securities
in any state or jurisdiction unless we are qualified or licensed to sell
securities in such state or jurisdiction. We authorize you, if you deem it
unadvisable in arranging sales of Securities for our account hereunder, to
sell any of our Securities to any particular Dealer, or other buyer, because
of the securities or Blue Sky laws of any jurisdiction, to sell our Securities
to one or more other Underwriters at the Offering Price less, in the case of a
sale to any Dealer, such amount, not in excess of the concession to Dealers
thereon, as you may determine. The transfer tax on any such sales among
Underwriters shall be treated as an expense and charged to the respective
accounts of the several Underwriters, in proportion to their respective
underwriting obligations.
12. DEFAULT BY UNDERWRITERS. Default by one or more Underwriters,
in
respect to their obligations under the Underwriting Agreement shall not
release us from any of our obligations. In case of such default by one or
more Underwriters, you are authorized to increase, pro rata, with the other
nondefaulting Underwriters, the number of defaulted Securities which we shall
be obligated to purchase from the Company, provided, however, that the
aggregate amount of all such increases for all Underwriters shall not exceed
ten percent (10%) of such Securities, and, if the aggregate number of the
Securities not taken up by such defaulting Underwriters exceeds such ten
percent (10%), you are further authorized, but shall not be obligated, to
arrange for the purchase by other persons, who may include yourselves, of all
or a portion of the Securities not taken up by such Underwriters. In the
event any such increases or arrangements are made, the respective numbers of
Securities to be purchased by the nondefaulting Underwriters and by any such
other person or persons shall be taken as the basis for the underwriting
obligations under this Agreement, but this shall not in any way affect the
liability of any defaulting Underwriters to the other Underwriters for damages
resulting from such default.
In the event of default by one or more Underwriters in respect of
their
obligations under this Agreement to take up and pay for any Securities
purchased by your for their respective accounts, pursuant to Section 9 hereof,
or to deliver any such Securities sold or overallotted by you for their
respective accounts pursuant to any provisions of this Agreement, and to the
extent that arrangements shall not have been made by you for other persons to
assume the obligations of such defaulting Underwriter or Underwriters, each
nondefaulting Underwriter shall assume its proportionate share of the
aforesaid obligations of each such defaulting Underwriter without relieving
any such Underwriter of its liability therefor.
13. TERMINATION OF AGREEMENT. Unless earlier terminated by you, the
provisions of Sections 2, 3, 4, 6, 9 and 10 of this Agreement shall, except as
otherwise provided therein, terminate thirty (30) full business days after the
effective date of the Registration Statement herein referred to, but may be
extended by you for an additional period or periods not exceeding thirty (30)
full business days in the aggregate. You may, however, terminate this
Agreement, or any provisions hereof, at any time by written or telegraphic
notice to us.
14. GENERAL POSITION OF THE REPRESENTATIVE. In taking action under
this Agreement, you shall act only as agent of the several Underwriters. Your
authority as Representative of the several Underwriters shall include the
taking
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of such action as you may deem advisable in respect of all matters pertaining
to any and all offers and sales of the Securities, including the right to make
any modifications which you consider necessary or desirable in the
arrangements with Dealers or others. You shall be under no liability for or
in respect of the value of the Securities or the validity or the form thereof,
the Registration Statement, the Prospectus, the Underwriting Agreement, or
other instruments executed by the Company or others of any agreement on its or
their part; nor shall you, as such Representative or otherwise, be liable
under any of the provisions hereof, or for any matters connected herewith,
except for want of good faith, and except for any liability arising under the
Securities Act of 1933; and no obligation not expressly assumed by you as such
Representative herein shall be implied from this Agreement. In representing
the Underwriters hereunder, you shall act as the representative of each of
them respectively. Nothing herein contained shall constitute the several
Underwriters partners with you or with each other, or render any Underwriter
liable for the commitments of any other Underwriter, except as otherwise
provided in Section 12 hereof. The commitments and liabilities of each of the
several Underwriters are several in accordance with their respective
underwriting obligations and are not joint.
15. ACKNOWLEDGMENT OF REGISTRATION STATEMENT, ETC. We hereby
confirm
that we have examined the Registration Statement (including all amendments
thereto) relating to the Securities as heretofore filed with the Securities
and Exchange Commission, that we are familiar with the amendment(s) to the
Registration Statement and the final form of Prospectus proposed to be filed,
that we are willing to accept the responsibilities of an underwriter
thereunder, and that we are willing to proceed as therein contemplated. We
further confirm that the statements made under the heading "Underwriting" in
such proposed final form of Prospectus are correct and we authorize you so to
advise the Company on our behalf. We understand that the aforementioned
documents are subject to further change and that we will be supplied with
copies of any amendment or amendments to the Registration Statement and of any
amended Prospectus promptly, if and when received by you, but the making of
such changes and amendments shall not release us or affect our obligations
hereunder or under the Underwriting Agreement.
16. INDEMNIFICATION. Each Underwriter, including you, agrees to
indemnify and hold harmless each other Underwriter and each person who
controls any other Underwriter within the meaning of Section 15 of the
Securities Act of 1933, as amended, to the extent of their several commitments
under the Underwriting Agreement and upon the terms that such Underwriter
agrees to indemnify and hold harmless the Company as set forth in Section 7 of
the Underwriting Agreement. The Agreement contained in this Section 16 shall
survive any termination of this Agreement Among Underwriters.
17. CAPITAL REQUIREMENTS. We confirm that our ratio of aggregate
indebtedness to net capital is such that we may, in accordance with and
pursuant to Rule 15c3-1, promulgated by the Securities and Exchange Commission
under the Securities Exchange Act of 1934, agree to purchase the number of
Securities we may be obligated to purchase under any provision of the
Underwriting Agreement or this Agreement.
18. MISCELLANEOUS. We have transmitted herewith a completed
Underwriters' Questionnaire on the form thereof supplied by you. Any notice
hereunder from you to us or from us to you shall be deemed to have been duly
give if sent by registered mail, telegram, teletype, telex, telecopier,
graphic scan, or other written form of telecommunication to us at our address
as set forth in the Underwriting Agreement, or to you at the address set forth
on the first page of this Agreement.
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You hereby confirm that you are registered as a broker-dealer with
the
United States Securities and Exchange Commission and that you are a member of
the NASD and we confirm that we are either a member of the NASD or a foreign
broker-dealer not eligible for membership under Section I of the Bylaws of the
NASD, who agrees to make no sales within the United States, its territories or
possessions, or to persons who are nationals thereof or residents therein,
and, in making sales, to comply with the requirements of the NASD's
Interpretation with Respect to Free Riding and Withholding, and with Sections
2730, 2740 and 2420 to the extent applicable to foreign nonmember brokers or
dealers, and Section 2750 of the NASD's Rules of Fair Practice.
We will comply with all applicable federal laws, the laws of the
states
or other jurisdictions concerned and the Rules and Regulations of the NASD,
including, but not limited to, Section 2740 of the Rules of Fair Practice.
This instrument may be signed by the Underwriters in various
counterparts which together shall constitute one and the same agreement among
all the Underwriters and shall become effective as between us at such time as
you shall have confirmed same by returning an executed copy to us, and
thereafter, as to us and the other Underwriters, upon execution by them of
counterparts which are confirmed by you. In no event, however, shall we have
any liability under this Agreement if the Underwriting Agreement is not
executed.
Please confirm that the foregoing correctly states the understanding
between us by signing and returning to us a counterpart hereof.
Very truly yours,
_________________________________________
Attorney-in-Fact
for the several Underwriters
named in Schedule I
to the Underwriting Agreement
Confirmed as of the date first above written.
Westport Resources Investment Services, Inc..
As Representative
By_______________________________
Senior Vice President
