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Exhibit 1.1
1,700,000 SHARES
ADVANCED LIGHTING TECHNOLOGIES, INC.
COMMON STOCK
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AGENCY AGREEMENT
St. Petersburg, Florida
August 31, 2000
Xxxxxxx Xxxxx & Associates, Inc.
Xxxxxxx Xxxxxx Xxxxxx Inc.
c/o Raymond Xxxxx & Associates, Inc.
000 Xxxxxxxx Xxxxxxx
Xx. Xxxxxxxxxx, Xxxxxxx 00000
Ladies and Gentlemen:
Advanced Lighting Technologies, Inc., an Ohio corporation (the
"Company"), confirms its agreement with the several Agents named above (each, an
"Agent" and, collectively, the "Agents"), with respect to the issue and sale by
the Company of up to an aggregate of 1,700,000 shares of the Company's Common
Stock, par value $.001 per share (the "Shares"), as follows:
1. REGISTRATION STATEMENT AND PROSPECTUS. The Company and ADLT Trust I
(the "Trust") have prepared and filed with the Securities and Exchange
Commission (the "Commission") in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "Act"), a registration statement on
Form S-3 (File No. 333-58613), including a base prospectus, relating to, among
other securities of the Company, the Shares. Such registration statement, as
amended at the time it became effective and as thereafter amended by any
post-effective amendment, is referred to in this Agreement as the "Registration
Statement." The final base prospectus in the form filed with the Commission
pursuant to Rule 424(b) under the Act and the final prospectus supplement
relating to the offering of the Shares, in the form first furnished to the
Agents by the Company for use in connection with the offering of the Shares, are
collectively referred to herein as the "Prospectus." If the Company files
another registration statement with the Commission to register a portion of the
Shares pursuant to Rule 462(b) under the Act (the "Rule 462 Registration
Statement"), then any reference to "Registration Statement" herein shall be
deemed to include the registration statement on Form S-3 (File No. 333-58613)
and the Rule 462 Registration Statement, as each such registration statement may
be amended pursuant to the Act. The preliminary prospectus supplement and the
accompanying base prospectus relating to the Shares and provided to the Agents
for use prior to the date hereof and as such prospectus is amended from time to
time until the date of the Prospectus are collectively referred to in this
Agreement as the "Prepricing Prospectus." Any reference in this Agreement to the
Registration Statement, any Prepricing Prospectus or the Prospectus shall be
deemed to refer to and include the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the Act, as of the date of the
Registration Statement, such Prepricing Prospectus or the Prospectus, as the
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case may be, and any reference to any amendment or supplement to the
Registration Statement, any Prepricing Prospectus or the Prospectus shall be
deemed to refer to and include any documents filed after such date under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), which, upon
filing, are incorporated by reference therein, as required by paragraph (b) of
Item 12 of Form S-3. As used herein, the term "Incorporated Documents" means the
documents which at the time are incorporated by reference in the Registration
Statement, any Prepricing Prospectus, the Prospectus, or any amendment or
supplement thereto.
2. APPOINTMENTS OF AGENTS; PAYMENT AND DELIVERY. (a) Subject to the
terms and conditions set forth herein, the Company hereby appoints each Agent as
its agent for purposes of soliciting purchases of Shares from the Company by
others. The Company agrees that, during the period that the Agents are acting as
agents hereunder, it will not appoint any other agents to act on its behalf, or
to assist it, in the placement of the Shares.
(b) The Agents shall use their reasonable best efforts to
assist the Company to locate purchasers for the Shares. The Agents shall
communicate to the Company, orally, each offer for the purchase of Shares
solicited by them other than those offers rejected by such Agent. Each Agent
shall have the right, in its discretion reasonably exercised, to reject any
offer for the purchase of Shares, in whole or in part, and any such rejection
shall not be deemed a breach of its agreement contained herein. The Company may
accept or reject any offer for the purchase of Shares, in whole or in part and
any such rejection shall not be deemed a breach of its agreement contained
herein. Each Agent shall make reasonable efforts to assist the Company in
obtaining performance by each purchaser whose offer for the purchase of Shares
has been solicited by it on an agency basis and accepted by the Company. Such
Agent shall not have any liability to the Company in the event that any such
purchase is not consummated for any reason. If the Company shall default on its
obligation to deliver Shares to a purchaser whose offer has been solicited by
such Agent and accepted by the Company, the Company shall (i) hold such Agent
harmless against any loss, claim or damage arising from or as a result of such
default by the Company and (ii) pay to such Agent the commission set forth
herein to which it would otherwise be entitled absent such default.
(c) The Company shall deliver the Shares against the purchase
price paid therefor, at 10:00 a.m., New York time, on September 6, 2000 (the
"Closing Date"). The place of closing for the Shares shall be the offices of
Xxxxx & Wood LLP, One World Trade Center, New York, New York or such other place
as you and the Company shall agree. Certificates for the Shares to be purchased
hereunder shall be registered in such names and in such denominations as you
shall request prior to 1:00 p.m., Florida time, not later than two full business
days preceding the Closing Date. Such certificates shall be made available to
you in New York, New York for inspection and packaging not later than 9:30 a.m.,
Florida time, on the business day immediately preceding the Closing Date. The
certificates evidencing the Shares to be purchased hereunder shall be delivered
to your order on the Closing Date against payment of the purchase price
therefor.
3. TERMS OF PUBLIC OFFERING. The Company has been advised by you that
you agree to use your reasonable best efforts to assist the Company in effecting
a public offering of the Shares as soon after this Agreement has become
effective and that such offering shall be upon the terms set forth in the
Prospectus.
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4. SOLICITATIONS AS AGENT. (a) On the basis of the representations and
warranties, covenants and agreements herein contained, but subject to the terms
and conditions herein set forth, the Agents, as agents of the Company, will use
their reasonable best efforts to solicit offers for the purchase of Shares upon
the terms set forth in the Prospectus. Neither Agent has been authorized by the
Company to, and neither Agent shall, appoint any sub-agent with respect to
Shares sold through it as agent. All Shares sold by the Company to any purchaser
through an Agent will be sold at a public offering price of $15.00 per share.
(b) The Company agrees to pay each Agent a commission of $.975
per share for each Share sold by the Company as a result of a solicitation made
by such Agent, as an agent of the Company. Such commissions will be paid to the
Agents on the Closing Date by wire transfer of immediately available funds to
accounts specified in writing by the Agents.
5. COVENANTS AND AGREEMENTS OF THE COMPANY. The Company covenants and
agrees with the several Agents as follows:
(a) The Company will use its best efforts to cause any
amendments to the Registration Statement to become effective, if not already
effective, and will advise you promptly and, if requested by you, will confirm
such advice in writing (i) when any post-effective amendment becomes effective,
(ii) when the Prospectus and any Prepricing Prospectus have been timely filed
pursuant to Rule 424(b) under the Act, (iii) of any request by the Commission
for amendments or supplements to the Registration Statement, any Prepricing
Prospectus or the Prospectus or for additional information, (iv) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the suspension of qualification of the Shares for
offering or sale in any jurisdiction or the initiation of any proceeding for
such purposes, and (v) within the period of time referred to in Section 5(e)
below, of any change in the Company's condition (financial or other), business,
prospects, properties, net worth or results of operations, or of any event that
comes to the attention of the Company that makes any statement made in the
Registration Statement or the Prospectus and any Prepricing Prospectus (as then
amended or supplemented) untrue in any material respect or that requires the
making of any additions thereto or changes therein in order to make the
statements therein (in the case of the Prospectus and any Prepricing Prospectus,
in light of the circumstances under which they were made) not misleading in any
material respect, or of the necessity to amend or supplement the Prospectus and
any Prepricing Prospectus (as then amended or supplemented) to comply with the
Act or any other law. If at any time the Commission shall issue any stop order
suspending the effectiveness of the Registration Statement, the Company will
make every reasonable effort to obtain the withdrawal or lifting of such order
at the earliest possible time.
(b) The Company will furnish to you, without charge, two
conformed copies of the Registration Statement as originally filed with the
Commission and of each amendment thereto, including financial statements and all
exhibits thereto, and will also furnish to you, without charge, such additional
number of conformed copies of the Registration Statement as originally filed and
of each amendment thereto as you may reasonably request.
(c) The Company will not file any Rule 462(b) Registration
Statement or any amendment to the Registration Statement or make any amendment
or supplement to the Prospectus or any Prepricing Prospectus unless (i) you
shall have previously been advised
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thereof and been given a reasonable opportunity to review such filing, amendment
or supplement, and (ii) you have not reasonably objected to such filing,
amendment or supplement after being so advised.
(d) Prior to the execution and delivery of this Agreement, the
Company has delivered or will deliver to you, without charge, in such quantities
as you have requested or may hereafter reasonably request, copies of each form
of the Prepricing Prospectus. Consistent with the provisions of Section 5(e)
hereof, the Company consents to the use, in accordance with the provisions of
the Act and with the securities or Blue Sky laws of the jurisdictions in which
the Shares are solicited for purchase by the several Agents prior to the date of
the Prospectus, of each Prepricing Prospectus so furnished by the Company.
(e) As soon after the execution and delivery of this Agreement
as is practicable and thereafter from time to time for such period as in the
reasonable opinion of counsel for the Agents a prospectus is required by the Act
to be delivered in connection with sales by or through any Agent or dealer, and
for so long a period as you may request for the distribution of the Shares, the
Company will deliver to each Agent and each dealer, without charge, as many
copies of the Prospectus (and of any amendment or supplement thereto) as they
may reasonably request. The Company consents to the use of the Prospectus (and
of any amendment or supplement thereto) in accordance with the provisions of the
Act and with the securities or Blue Sky laws of the jurisdictions in which the
Shares are solicited for purchase by the several Agents, both in connection with
the offering and sale of the Shares and for such period of time thereafter as
the Prospectus is required by the Act to be delivered in connection with sales
by or through any Agent or dealer. If at any time prior to the completion of the
distribution of the Shares pursuant to the offering contemplated by the
Prospectus, any event shall occur that in the judgment of the Company or in the
opinion of counsel for the Agents is required to be set forth in the Prospectus
(as then amended or supplemented) or should be set forth therein in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, or if it is necessary to supplement or amend the
Prospectus to comply with the Act or any other law, the Company will forthwith
prepare and, subject to Sections 5(a) and 5(c) hereof, file with the Commission
and use its best efforts to cause to become effective as promptly as possible an
appropriate supplement or amendment thereto, and will furnish to each Agent who
has previously requested Prospectuses, without charge, a reasonable number of
copies thereof.
(f) The Company will cooperate with you and counsel for the
Agents in connection with the registration or qualification of the Shares for
solicitation for sale by the several Agents under the securities or Blue Sky
laws of such jurisdictions as you may reasonably designate and will file such
consents to service of process or other documents as may be reasonably necessary
in order to effect and maintain such registration or qualification for so long
as required to complete the distribution of the Shares; provided that in no
event shall the Company be obligated to qualify to do business in any
jurisdiction where it is not now so qualified or to take any action which would
subject it to general service of process in suits, other than those arising out
of the offering or sale of the Shares, as contemplated by this Agreement and the
Prospectus, in any jurisdiction where it is now so subject. In the event that
the qualification of the Shares in any jurisdiction is suspended, the Company
shall so advise you promptly in writing.
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(g) The Company will timely file such reports pursuant to the
Exchange Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the Act.
(h) [reserved]
(i) If this Agreement shall terminate or shall be terminated
after execution pursuant to any provision hereof or if this Agreement shall be
terminated by the Agents because of any inability, failure or refusal on the
part of the Company to perform in all material respects any agreement herein or
to comply in all material respects with any of the terms or provisions hereof or
to fulfill in all material respects any of the conditions of this Agreement, the
Company agrees to reimburse you and the other Agents for all out-of-pocket
expenses (including travel expenses and reasonable fees and expenses of counsel
for the Agents but excluding wages and salaries paid by you) reasonably incurred
by you in connection herewith.
(j) The Company will apply the net proceeds from the sale of
the Shares to be sold by it hereunder in accordance in all material respects
with the statements under the caption "Use of Proceeds" in the Prospectus.
(k) For a period of 90 days after the date of the Prospectus
first filed pursuant to Rule 424(b) under the Act, without your prior written
consent, the Company will not, directly or indirectly, issue, sell, offer or
contract to sell or otherwise dispose of or transfer any shares of Common Stock
or securities convertible into or exchangeable or exercisable for shares of
Common Stock (collectively, "Company Securities") or any rights to purchase
Company Securities, except to purchasers solicited by the Agents pursuant to
this Agreement and except for the Company's 1995 Incentive Award Plan, Employee
Stock Purchase Plan, 1997 Billion Dollar Market Capitalization Incentive Award
Plan, 1998 Incentive Award Plan and the 401(k) Retirement and Savings Plan
(collectively, the "Plans") and the Company's Series A Convertible Preferred
Stock, Series A Warrant and Contingent Warrant Agreement, dated as of September
30, 1999 (collectively, the "GE Agreements").
(l) Prior to the Closing Date the Company will furnish to you,
as promptly as possible, copies of any consolidated financial statements of the
Company and its subsidiaries for any period subsequent to the periods covered by
the financial statements appearing in the Prospectus.
(m) [reserved]
(n) The Company will not at any time, directly or indirectly
take any action designed, or which might reasonably be expected to cause or
result in, or which will constitute, stabilization or manipulation of the price
of the shares of Common Stock to facilitate the sale or resale of any of the
Shares.
(o) The Company will use its best efforts to qualify or
register its Common Stock for sale in non-issuer transactions under (or obtain
exemptions from the application of) the Blue Sky laws of each state where
necessary to permit market making transactions and secondary trading, and will
comply with such Blue Sky laws and will continue such
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qualifications, registrations and exemptions in effect for a period of one year
from the date hereof, so long as any shares of the Company's Common Stock are
held by persons other than "affiliates" (as defined in Rule 144 under the Act)
of the Company.
(p) As long as quotations for the Company's Common Stock are
reported by the Nasdaq National Market, the Company will timely file with the
Nasdaq National Market all documents and notices required by the Nasdaq National
Market of companies that have securities quotations for which are reported by
the Nasdaq National Market.
6. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents and warrants to each Agent on the date hereof, and shall be deemed to
represent and warrant to each Agent as of the Closing Date, that:
(a) The Company satisfies all of the requirements of the Act
for use of Form S-3 for the offering of Shares contemplated hereby. Each
Prepricing Prospectus included as part of the Registration Statement as
originally filed or any amendment or supplement thereto, or filed pursuant to
Rule 424(b) under the Act, complied as to form when so filed in all material
respects with the provisions of the Act, except that this representation and
warranty does not apply to statements in or omissions from such Prepricing
Prospectus (or any amendment or supplement thereto) made in reliance upon and in
conformity with information relating to any Agent furnished to the Company in
writing by or on behalf of any Agent through you, expressly for use therein. The
Commission has not issued any order preventing or suspending the use of any
Prepricing Prospectus.
(b) The Registration Statement (including any Rule 462
Registration Statement), in the form in which it became effective and also in
such form as it may be when any post-effective amendment thereto shall become
effective, and the Prospectus, and any supplement or amendment thereto when
filed with the Commission under Rule 424(b) under the Act, complied and will
comply as to form in all material respects with the provisions of the Act and
did not and will not at any such times contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading, except that this representation
and warranty does not apply to statements in or omissions from the Registration
Statement or the Prospectus (or any amendment or supplement thereto) made in
reliance upon and in conformity with information relating to any Agent furnished
to the Company in writing by or on behalf of any Agent through you expressly for
use therein.
(c) The documents incorporated or deemed to be incorporated by
reference in the Registration Statement and the Prospectus, at the time they
were or hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the Exchange Act and the rules and
regulations of the Commission thereunder and, when read together with the other
information in the Prospectus did not and will not contain an untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading.
(d) The capitalization of the Company is as set forth in the
Prospectus as of the date set forth therein. All the outstanding shares of
Common Stock of the Company have been, and as of the Closing Date will be, duly
authorized and validly issued, are fully paid and
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nonassessable and are free of any preemptive or similar rights (except with
respect to 7,292 shares with respect to which certificates have not yet been
issued); except for directors qualifying shares, if any, shares and options
issuable pursuant to the Plans, shares and warrants issuable pursuant to the GE
Agreements, and except as set forth in the Prospectus, the Company is not a
party to or bound by any outstanding options, warrants or similar rights to
subscribe for, or contractual obligations to issue, sell, transfer or acquire,
any of its capital stock or any securities convertible into or exchangeable for
any of such capital stock; the Shares to be issued and sold by the Company to
purchasers solicited by the Agents hereunder have been duly authorized and, when
issued and delivered to such purchasers against full payment therefor in
accordance with the terms hereof will be validly issued, fully paid and
nonassessable and free of any preemptive or similar rights; the capital stock of
the Company conforms to the description thereof in the Registration Statement
and the Prospectus (or any amendment or supplement thereto); and the delivery of
certificates for the Shares against payment therefor pursuant to the terms of
this Agreement, will pass valid title to the Shares, free and clear of any
claim, encumbrance or defect in title, to the purchasers solicited by the Agents
purchasing such shares in good faith and without notice of any lien, claim or
encumbrance. The certificates for the Shares are in valid and sufficient form.
(e) Each of the Company and its subsidiaries is a corporation
duly organized and validly existing as a corporation in good standing under the
laws of the state of its incorporation with full corporate power and authority
to own, lease and operate its properties and to conduct its business as
presently conducted and as described in the Registration Statement and the
Prospectus (and any amendment or supplement thereto), and is duly registered and
qualified to conduct its business and is in good standing in each jurisdiction
or place where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure to so
register or qualify does not have a material adverse effect on the condition
(financial or other), business, business prospects, properties, net worth,
results of operations of the Company and its subsidiaries taken as a whole (a
"Material Adverse Effect").
(f) The issued shares of capital stock of each of the
Company's subsidiaries have been duly authorized and validly issued, are fully
paid and nonassessable and are owned by the Company free and clear of any
security interests, liens, encumbrances, equities or claims, except as described
in the financial statements incorporated in, or elsewhere, in the Prospectus,
subject to the further exception of potential assessments amounting to not more
than $50,000 that may be payable under Wisconsin law with respect to the capital
stock of Ruud Lighting, Inc. The Company does not have any subsidiaries required
to be included in Exhibit 21 to its Annual Report on Form 10-K, except for Asian
Lighting Resources Ltd. and Lighting Resources Holdings (Mauritius) Limited and
except as set forth in Exhibit 21 to the Company's Annual Report on Form 10-K
for its fiscal year ended June 30, 1999, which is incorporated by reference into
the Registration Statement. As used in this Agreement, the term "subsidiary"
shall mean any direct and indirect subsidiary of the Company and shall exclude
any entity as to which the Company (and all subsidiaries of the Company, taken
as a whole) does not own an equity interest entitling the Company to exercise in
excess of 50% of the voting power of such entity.
(g) There are no legal or governmental proceedings pending or,
to the best knowledge of the Company, threatened, against the Company or its
subsidiaries or to which the Company or its subsidiaries or any of their
properties are subject, that are required to be described in the Registration
Statement or the Prospectus (or any amendment or supplement
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thereto) but are not described as required. Except as described in the
Prospectus, there is no action, suit, inquiry, proceeding or investigation by or
before any court or governmental or other regulatory or administrative agency or
commission pending or, to the best knowledge of the Company, threatened, against
or involving the Company or its subsidiaries, which might individually or in the
aggregate prevent or adversely affect the transactions contemplated by this
Agreement or result in a Material Adverse Effect, nor to the Company's
knowledge, is there any basis for any such action, suit, inquiry, proceeding, or
investigation. There are no agreements, contracts, indentures, leases or other
instruments that are required to be described in the Registration Statement or
the Prospectus (or any amendment or supplement thereto) or to be filed as an
exhibit to the Registration Statement that are not described, filed or
incorporated by reference in the Registration Statement and the Prospectus as
required by the Act.
(h) Neither the Company nor any of its subsidiaries is (i) in
violation of (aa) its organizational documents, (bb) any law, ordinance,
administrative or governmental rule or regulation applicable to the Company or
any of its subsidiaries the violation of which would have a Material Adverse
Effect, or (cc) of any decree of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries which would have a
Material Adverse Effect; or (ii) in default in any material respect in the
performance of any obligation, agreement or condition contained in (aa) any
bond, debenture, note or any other evidence of indebtedness, or (bb) any
agreement, indenture, lease or other instrument to which the Company or any of
its subsidiaries is a party or by which any of their properties may be bound,
which default would have a Material Adverse Effect; and there does not exist any
state of facts which constitutes an event of default on the part of the Company
or any of its subsidiaries as defined in such documents or which, with notice or
lapse of time or both, would constitute such an event of default.
(i) The Company's execution and delivery of this Agreement and
the performance by the Company of its obligations under this Agreement have been
duly and validly authorized by the Company, and this Agreement has been duly
executed and delivered by the Company, and this Agreement constitutes a valid
and legally binding agreement of the Company, enforceable against the Company in
accordance with its terms, except to the extent enforceability may be limited by
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other
similar laws relating to or affecting enforcement of creditors' rights generally
or by general equitable principles and public policy exceptions, and except as
rights to indemnity and contribution hereunder may be limited by federal or
state securities laws.
(j) Neither the issuance and sale of the Shares by the
Company, the execution, delivery or performance of this Agreement by the Company
nor the consummation by the Company of the transactions contemplated hereby or
thereby (i) requires any consent, approval, authorization or other order of or
registration or filing with, any court, regulatory body, administrative agency
or other governmental body, agency or official (except such as may be required
by the securities or Blue Sky laws of various jurisdictions, which will, or have
been, effected in accordance with this Agreement), (ii) conflicts with or will
conflict with or constitutes or will constitute a breach of, or a default under,
the Company's articles of incorporation, as amended and restated, or the
Company's code of regulations or any agreement, indenture, lease or other
instrument to which the Company or any of its subsidiaries is a party or by
which any of its properties may be bound, (iii) violates any statute, law,
regulation, ruling, filing, judgment, injunction, order or decree applicable to
the Company or any of its subsidiaries
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or any of their properties, or (iv) results in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company.
(k) Except as described in the Prospectus, and except for
options to acquire capital stock issued pursuant to the Plans and the GE
Agreements, neither the Company nor any of its subsidiaries has outstanding and
at the Closing Date (and the Additional Closing Date, if applicable) will not
have outstanding any options to purchase, or any warrants to subscribe for, or
any securities or obligations convertible into, or any contracts or commitments
to issue or sell, any shares of Common Stock or any such warrants or convertible
securities or obligations. No holder of securities of the Company has rights to
the registration of any securities of the Company as a result of or in
connection with the filing of the Registration Statement or the consummation of
the transactions contemplated hereby that have not been satisfied or heretofore
waived in writing.
(l) Each of Xxxxx Xxxxxxxx LLP and Ernst & Young LLP, the
certified public accountants who have certified the financial statements filed
as part of the Registration Statement and the Prospectus (or any amendment or
supplement thereto), are independent public accountants as required by the Act.
(m) The financial statements, together with related schedules
and notes, included in the Registration Statement and the Prospectus (and any
amendment or supplement thereto), present fairly the financial condition,
results of operations and cash flows of the Company on the basis stated in the
Registration Statement at the respective dates or for the respective periods to
which they apply; such statements and related schedules and notes have been
prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except as disclosed
therein; and the other financial and statistical information and date set forth
in the Registration Statement and Prospectus (and any amendment or supplement
thereto) is accurately presented and prepared on a basis consistent with such
financial statements and the books and records of the Company. No other
financial statements or schedules are required to be included in the
Registration Statement.
(n) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus (or any amendment or supplement thereto), (i)
neither the Company nor any of its subsidiaries has incurred any material
liabilities or obligations, indirect, direct or contingent, or entered into any
transaction which is not in the ordinary course of business; (ii) neither the
Company nor any of its subsidiaries has paid or declared any dividends or other
distributions with respect to its capital stock and the Company is not in
default under the terms of any class of capital stock of the Company; (iii)
there has not been any change in the authorized or outstanding capital stock of
the Company (other than issuances of Common Stock pursuant to the Plans) or any
material change in the indebtedness of the Company (other than in the ordinary
course of business); and (iv) there has not been any material adverse change, or
any development involving or which may reasonably be expected to result in a
material adverse change, in the condition (financial or otherwise), business,
properties, net worth or results of operations of the Company and its
subsidiaries taken as a whole.
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(o) Each of the Company and its subsidiaries has good and
valid title to all property (real and personal) described in the Prospectus as
being owned by it, free and clear of all liens, claims, security interests or
other encumbrances except (i) such as are described in the financial statements
incorporated in, or elsewhere in, the Prospectus or (ii) such as are not
materially burdensome and do not interfere in any material respect with the use
of the property or the conduct of the business of the Company and its
subsidiaries taken as a whole. All property (real and personal) held under lease
by the Company and its subsidiaries is held by it under valid, subsisting and
enforceable leases with only such exceptions as in the aggregate are not
materially burdensome and do not interfere in any material respect with the
conduct of the business of the Company or its subsidiaries taken as a whole.
(p) The Company has not distributed and will not distribute,
and has not authorized the Agents to distribute, any offering material in
connection with the offering and sale of the Shares other than the Prepricing
Prospectus, the Prospectus, or other offering material, if any, as permitted by
the Act.
(q) Other than excepted activity pursuant to Regulation M
under the Exchange Act, the Company has not taken, directly or indirectly, any
action which constituted, or any action designed, or which might reasonably be
expected to cause or result in or constitute, under the Act or otherwise,
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Shares or for any other purpose.
(r) The Company is not an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
(s) Each of the Company and its subsidiaries has all permits,
licenses, franchises, approvals, consents and authorizations of governmental or
regulatory authorities (hereinafter "permit" or "permits") as are necessary to
own its properties and to conduct its business in the manner described in the
Prospectus, subject to such qualifications as may be set forth in the
Prospectus, except where the failure to have obtained any such permit has not
and will not have a Material Adverse Effect; each of the Company and its
subsidiaries has operated and is operating its business in material compliance
with and not in material violation of all of its obligations with respect to
each such permit and no event has occurred which allows, or after notice or
lapse of time would allow, revocation or termination of any such permit or
result in any other material impairment of the rights of any such permit where
such revocation, termination or impairment would have a Material Adverse Effect,
subject in each case to such qualification as may be set forth in the
Prospectus; and, except as described in the Prospectus, such permits contain no
restrictions that are materially burdensome to the Company and its subsidiaries
taken as a whole.
(t) The Company and its subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (iii) access to
assets is permitted only in accordance with management's general or specific
authorizations; and (iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
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(u) Neither the Company nor any of its subsidiaries, since
each has been a subsidiary of the Company, nor, to the Company's knowledge, any
employee or agent of the Company or any of its subsidiaries, has, directly or
indirectly, (i) made any unlawful contribution to any candidate for political
office, or failed to disclose fully any contribution in violation of law, or
(ii) made any payment to any federal, state or foreign governmental official, or
other person charged with similar public or quasi-public duties, other than
payments required or permitted by the laws of the United States or any
jurisdiction thereof or applicable foreign jurisdictions.
(v) The Company and its subsidiaries are (i) in compliance
with any and all applicable federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws"), (ii) have received all permits, licenses or other
approvals required of them under applicable Environmental Laws to conduct their
respective businesses and (iii) are in compliance with all terms and conditions
of any such permit, license or approval, except where such noncompliance with
Environmental Laws, failure to receive required permits, licenses or other
approvals or failure to comply with the terms and conditions of such permits,
licenses or other approvals would not, singly or in the aggregate, have a
Material Adverse Effect.
(w) The Company and its subsidiaries own and have full right,
title and interest in and to, or have valid licenses to use, each material
patent, patent application, trade name, trademark or service xxxx currently
employed by them or under which the Company and its subsidiaries conduct all or
any material part of their business, and neither the Company nor any such
subsidiary has voluntarily created any lien or encumbrance on, or granted any
right or license with respect to, any such patent, patent application, trade
name, trademark or service xxxx except as described in the financial statements
incorporated in, or elsewhere in, the Prospectus; there is no claim pending
against the Company or any subsidiary with respect to any patent, patent
application, trade name, trademark or service xxxx and neither the Company nor
any such subsidiary has received notice or otherwise become aware that any
patent, patent application, trade name, trademark or service xxxx which it uses
or has used in the conduct of its business infringes upon or conflicts with the
rights of any third party.
(x) The Shares have been duly authorized for trading on the
Nasdaq National Market, and upon consummation of the offering contemplated
hereby the Company will be in compliance with the designation and maintenance
criteria applicable to Nasdaq National Market issuers.
(y) The Company and each of its subsidiaries have filed all
tax returns required to be filed (other than certain state or local tax returns,
as to which the failure to file, singly or in the aggregate, would not have a
Material Adverse Effect), which returns are complete and correct, and neither
the Company nor any subsidiary is in default in the payment of any taxes which
were payable pursuant to said returns or any assessments with respect thereto,
other than defaults that, singly or in the aggregate, would not have a Material
Adverse Effect. On the Closing Date, all stock transfer and other taxes which
are required to be paid in connection with the sale of the shares to be sold by
the Company to purchasers solicited by the Agents will have been fully paid by
the Company and all laws imposing such taxes will have been complied with.
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(z) Except as set forth or incorporated by reference in the
Prospectus, there are no transactions with "affiliates" (as defined in Rule 405
promulgated under the Act) or any officer, director or security holder of the
Company (whether or not an affiliate) which are required by the Act and the
applicable rules and regulations thereunder to be disclosed in the Registration
Statement.
(aa) The Company has procured Lock-Up Agreements, in the form
attached hereto as Exhibit A, from each of parties set forth on Schedule I
hereto.
(bb) The Company has procured a Lock-Up Agreement, in the form
attached hereto as Exhibit B, from General Electric Company Capital Corporation.
(cc) Neither the Company nor any of its subsidiaries (i)
conduct business or have affiliates which conduct business in or with Cuba, (ii)
plan to commence doing business in or with Cuba after the effective date of the
Registration Statement or (iii) are required by Florida law to report a material
change in information previously reported to the State of Florida regarding
business conducted in or with Cuba.
(dd) No officer, director, nominee for director or 5%
shareholder of the Company has a direct or indirect affiliation or association
with any member of the National Association of Securities Dealers, Inc. ("NASD")
except for such affiliations which have been disclosed to counsel for the
Agents.
7. EXPENSES. Whether or not the transactions contemplated hereby are
consummated or this Agreement becomes effective or is terminated, the Company
will pay or cause to be paid the following: (i) the fees, disbursements and
expenses of the Company's counsel and accountants in connection with the
registration of the Shares under the Act and all other expenses in connection
with the preparation, printing and filing of the Registration Statement and the
Prospectus and amendments and supplements thereto and the mailing and delivering
of copies thereof and of any Prepricing Prospectus to the Agents and the
purchasers solicited by such Agents; (ii) the printing and delivery (including,
without limitation, postage, air freight charges and charges for counting and
packaging) of such copies of the Registration Statement, the Prospectus, each
Prepricing Prospectus, the Blue Sky memoranda, this Agreement and all amendments
or supplements to any of them as may be reasonably requested for use in
connection with the offering and sale of the Shares; (iii) consistent with the
provisions of Section 5(e), all expenses in connection with the qualification of
the Shares for offering and sale under state securities laws or Blue Sky laws,
including reasonable attorneys' fees and out-of-pocket expenses of the counsel
for the Agents in connection therewith; (iv) the filing fees incident to
securing any required review by the NASD of the fairness of the terms of the
sale of the Shares and the reasonable fees and disbursements of the Agents'
counsel relating thereto; (v) the cost of preparing stock certificates; (vi) the
costs and charges of any transfer agent or registrar; (vii) the cost of the tax
stamps, if any, in connection with the issuance and delivery of the Shares to
the respective purchasers solicited by the Agents; (viii) all other fees, costs
and expenses referred to in Item 14 of the Registration Statement, (ix) the
transportation, lodging, graphics and other expenses incidental to the Company's
preparation for and participation in the "roadshow" for the offering
contemplated hereby, and (x) all other costs and expenses incident to the
performance of the obligations of the Company hereunder which are not otherwise
specifically provided for in this Section 7. Notwithstanding the foregoing, in
the event that the proposed offering is
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terminated for the reasons set forth in Section 5(i) hereof, the Company agrees
to reimburse the Agents as provided in Section 5(i).
8. INDEMNIFICATION AND CONTRIBUTION. Subject to the limitations in this
paragraph below, the Company agrees to indemnify and hold harmless each Agent,
the directors, officers, employees and agents of each Agent, and each person, if
any, who controls any Agent within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act from and against any and all losses, claims,
damages, liabilities and expenses, as incurred, including, without limitation,
reasonable costs of investigation and attorneys' fees and expenses
(collectively, "Damages") arising out of or based upon (i) any untrue statement
or alleged untrue statement of a material fact contained in any Prepricing
Prospectus or in the Registration Statement or the Prospectus or in any
amendment or supplement thereto, or any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein (in the case of the Prospectus and any Prepricing Prospectus,
in light of the circumstances under which they were made) not misleading, except
to the extent that any such Damages arise out of or are based upon an untrue
statement or omission or alleged untrue statement or omission which has been
made therein or omitted therefrom in reliance upon and in conformity with the
information furnished in writing to the Company by or on behalf of any Agent
through you expressly for use in connection therewith, or (ii) any inaccuracy in
or breach of the representations and warranties of the Company contained herein
or any failure of the Company to perform its obligations hereunder or under law;
PROVIDED, HOWEVER, that with respect to any untrue statement or omission made in
any Prepricing Prospectus, the indemnity agreement contained in this paragraph
shall not inure to the benefit of any Agent (or to the benefit of any person
controlling such Agent or to any officer, director, employee or agent of any
Agent) from whom the person asserting any such Damages purchased the Shares
concerned if both (y) a copy of the Prospectus was not sent or given to such
person at or prior to the written confirmation of the sale of such Shares to
such person as required by the Act, and (z) the untrue statement or omission in
the Prepricing Prospectus was corrected in the Prospectus. This indemnification
shall be in addition to any liability that the Company may otherwise have.
If any action or claim shall be brought against any Agent or any person
controlling any Agent in respect of which indemnity may be sought against the
Company, such Agent or such controlling person shall promptly notify the Company
in writing, and the Company shall assume the defense thereof, including the
employment of counsel reasonably acceptable to such Agent or such controlling
person and the payment of all reasonable fees and expenses incurred by such
counsel. The party against whom a claim for indemnification is being made
pursuant to this Section 8 is herein referred to as the "indemnifying party."
Such Agent or any such controlling person shall have the right to employ
separate counsel in any such action and participate in the defense thereof, but
the fees and expenses of such counsel shall be at the expense of such Agent or
such controlling person, unless (i) the indemnifying party has agreed in writing
to pay such fees and expenses, (ii) the indemnifying party has failed to assume
the defense and employ counsel reasonably acceptable to the Agent or such
controlling person or (iii) the named parties to any such action (including any
impleaded parties) include both such Agent or such controlling person and the
indemnifying party, and such Agent or such controlling person shall have been
advised by its counsel that one or more legal defenses may be available to the
Agent which may not be available to the Company, or that representation of such
indemnified party and such indemnifying party by the same counsel would be
inappropriate under applicable standards of professional conduct (whether or not
such representation by the same counsel has been
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proposed) due to actual or potential differing interests between them (in which
case the indemnifying party shall not have the right to assume the defense of
such action on behalf of such Agent or such controlling person (but the Company
shall not be liable for the fees and expenses of more than one counsel for the
Agents and such controlling persons)). In the case of any such separate firm for
the Agents and such control person of any Agents, such firm shall be designated
in writing by Xxxxxxx Xxxxx & Associates, Inc. The indemnifying party shall not
be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by this paragraph, the
indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of such
settlement. No indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
proceeding.
Each Agent agrees, severally and not jointly, to indemnify and hold
harmless the Company, its directors and its officers who sign the Registration
Statement, and any person who controls the Company within the meaning of Section
15 of the Act or Section 20 of the Exchange Act, to the same extent as the
foregoing indemnity from the Company to each Agent, but only with respect to
information furnished in writing by or on behalf or such Agent through you
expressly for use in the Registration Statement, the Prospectus or any
Prepricing Prospectus, or any amendment or supplement thereto. If any action or
claim shall be brought or asserted against the Company, any of its directors,
any of its officers, or any such controlling person based on the Registration
Statement, the Prospectus or any Prepricing Prospectus, or any amendment or
supplement thereto, and in respect of which indemnity may be sought against any
Agent pursuant to this paragraph, such Agent shall have the rights and duties
given to the Company by the immediately preceding paragraph (except that if the
Company shall have assumed the defense thereof such Agent shall not be required
to do so, but may employ separate counsel therein and participate in the defense
thereof, but the fees and expenses of such counsel shall be at such Agent's
expense), and the Company, its directors, any such officers, and any such
controlling persons, shall have the rights and duties given to the Agents by the
immediately preceding paragraph.
If the indemnification provided for in this Section 8 is unavailable or
insufficient for any reason whatsoever to an indemnified party under the first
or third paragraph of this Section 8 in respect of any Damages referred to
therein, then an indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such Damages (i) in such proportion as is appropriate to reflect
the relative benefits received by the Company, on the one hand, and the Agents
on the other hand, from the offering and sale of the Shares or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
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referred to in clause (i) above but also the relative fault of the Company on
the one hand, and the Agents on the other hand, in connection with the
statements or omissions that resulted in such Damages as well as any other
relevant equitable considerations. The relative benefits received by the Company
on the one hand, and the Agents on the other hand, shall be deemed to be in the
same proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company bear to the total commissions received by the
Agents, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault of the Company on the one hand, and the Agents on
the other hand, shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company on the one hand or by the Agents on the other hand and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The Company and the Agents agree that it would not be just and
equitable if contribution pursuant to this Section 8 was determined by a pro
rata allocation (even if the Agents were treated as one entity for such purpose)
or by any other method of allocation that does not take into account of the
equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an indemnified party as a result of the Damages
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 8, no Agent shall be required to contribute any amount in excess of the
amount by which the total price to the public of the Shares solicited by it and
distributed to the public by the Company exceeds the amount of any Damages which
such Agent has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Agents' obligations to contribute pursuant to
this Section 8 are several in proportion to the respective numbers of Shares
sold to purchasers solicited by such Agent and not joint.
The indemnity, contribution and reimbursement agreements contained in
this Section 8 and the representations and warranties of the Company set forth
in this Agreement shall remain operative and in full force and effect,
regardless of (i) any investigation made by or on behalf of any Agent or any
person controlling any Agent, the Company, its directors or officers or any
person controlling the Company, (ii) acceptance of any Shares and payment
therefor hereunder and (iii) any termination of this Agreement. A successor to
any Agent or any person controlling any Agent, or to the Company, its directors
or officers, or any person controlling the Company, shall be entitled to the
benefits of this indemnity, contribution and reimbursement agreements contained
in this Section 8.
9. CONDITIONS OF AGENT'S OBLIGATIONS. The several obligations of the
Agents hereunder are subject to the following conditions:
(a) The Registration Statement shall have become effective
prior to the date hereof and at the Closing Date no stop order suspending the
effectiveness of the Registration Statement shall have been issued under the Act
or proceedings therefor initiated or threatened by the Commission, and any
request on the part of the Commission for additional information shall
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have been complied with to the reasonable satisfaction of counsel to the Agents
and all filings required by Rules 424(b) and 462 under the Act shall have been
timely made.
(b) You shall be reasonably satisfied that since the
respective dates as of which information is given in the Registration Statement
and Prospectus, (i) there shall not have been any change in the capital stock of
the Company (other than pursuant to the Plans) or any material change in the
indebtedness (other than in the ordinary course of business) of the Company,
(ii) except as set forth or contemplated by the Registration Statement or the
Prospectus, no material oral or written agreement or other transaction shall
have been entered into by the Company which is not in the ordinary course of
business, (iii) no loss or damage (whether or not insured) to the property of
the Company shall have been sustained which had or could reasonably be expected
to have a Material Adverse Effect, (iv) no legal or governmental action, suit or
proceeding affecting the Company or any of its properties which is material to
the Company or which affects or could reasonably be expected to affect the
transactions contemplated by this Agreement shall have been instituted or
threatened, and (v) there shall not have been any material change in the
condition (financial or otherwise), business, business prospects, management,
results of operations of the Company and its subsidiaries taken as a whole which
makes it impractical or inadvisable in your judgment to proceed with the public
offering or purchase the Shares as contemplated hereby.
(c) You shall have received on the Closing Date (and the
Additional Closing Date, if any) an opinion of Xxxxxx, Xxxxxxxx & Sarlson Co.,
L.P.A., counsel to the Company, substantially to the effect that:
(i) The Company is a corporation duly incorporated
and validly existing in good standing under the laws of the
State of Ohio, with full corporate power and authority to own,
lease and operate its properties and to conduct its business
as described in the Registration Statement and the Prospectus
(and any amendment or supplement thereto), and is duly
registered or otherwise qualified to conduct its business as a
foreign corporation and is in good standing in each
jurisdiction or place where the nature of its properties or
the conduct of its business requires such registration or
qualification, except where the failure to so register or
qualify does not have a Material Adverse Effect.
(ii) Each of the subsidiaries (the "Subsidiaries")
set forth in Schedule II hereto is a corporation duly
organized and validly existing in good standing under the laws
of the jurisdiction of its organization, with full corporate
power and authority to own, lease and operate its properties
and to conduct its business as described in the Registration
Statement and the Prospectus (and any amendment or supplement
thereto); and is duly registered and qualified to conduct its
business and is in good standing in each jurisdiction or place
where the nature of its properties or the conduct of its
business requires such registration or qualification, except
where the failure to so register or qualify does not have a
Material Adverse Effect. All of the outstanding shares of
capital stock of each of the Subsidiaries have been duly
authorized and validly issued, and are fully paid and
nonassessable, and are owned of record, and to such counsel's
knowledge, beneficially, by the Company directly, or
indirectly through one of the other Subsidiaries, free and
clear of any perfected security interest, or any other
security interest, lien, adverse claim, equity or other
encumbrance; PROVIDED, HOWEVER, that the capital stock of
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the Subsidiaries is subject to a perfected security interest
granted by the Company pursuant to the Credit Agreement, dated
as of May 21, 1999, between the Company, Ballastronix,
Incorporated, Canadian Lighting Systems Holding, Incorporated,
Parry Power Systems Limited, Venture Lighting Europe Ltd., PNC
Bank, as agent, and the lending institutions named in such
Credit Agreement.
(iii) The capitalization of the Company conforms in
all material respects to the description thereof contained in
the Prospectus under the caption "Capitalization."
(iv) All shares of capital stock of the Company
outstanding prior to the issuance of the Shares to be issued
and sold by the Company hereunder, have been duly authorized
and validly issued, are fully paid and nonassessable and are
free of any preemptive or similar rights that entitle or will
entitle any person to acquire any Shares upon the issuance
thereof by the Company, and, to such counsel's knowledge, no
such rights will exist as of the Closing Date other than
pursuant to the GE Agreements.
(v) To the knowledge of such counsel, neither the
offer, sale or delivery of the Shares by the Company, the
execution, delivery or performance by the Company of this
Agreement, compliance by the Company with all provisions
hereof nor consummation by the Company of the transactions
contemplated hereby conflicts or will conflict with or
constitutes or will constitute a breach of, or a default
under, any material agreement, indenture, lease or other
instrument to which the Company is a party or by which any of
its properties is bound.
(vi) To the knowledge of such counsel after
reasonable inquiry, except as described in the Registration
Statement or Prospectus, there is no action, suit, inquiry,
proceeding, or investigation by or before any court or
governmental or other regulatory or administrative agency or
commission pending or threatened, against or involving the
Company or its subsidiaries, or the properties of either the
Company or any of its subsidiaries (A) which we believe are
likely, individually or in the aggregate, to prevent or
adversely affect the transactions contemplated by this
Agreement or (B) that are required to be described in the
Registration Statement or Prospectus (or any amendment or
supplement thereto) that are not described as required
therein.
(vii) To the knowledge of such counsel, the
agreements, contracts (and forms of contracts), indentures,
leases or other documents or instruments filed or incorporated
as exhibits to the Registration Statement are the only
agreements, contracts, indentures, leases or other documents
or instruments required to be so summarized or disclosed or
filed in the Registration Statement.
(viii) No consent, approval, authorization or other
order of, or registration or filing with, any court,
regulatory body, administrative agency or other governmental
body, agency or official is required on the part of the
Company (except such as have been obtained under the Act or
such as may be required under state securities or Blue Sky
laws governing the purchase and distribution of the Shares)
for the valid issuance and sale of the Shares to purchasers
solicited by the Agents under this Agreement.
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(ix) To the knowledge of such counsel after
reasonable inquiry, the Company satisfies all of the
requirements of the Act for use of Form S-3 for the offering
of Shares contemplated by this Agreement.
(x) The documents incorporated by reference in the
Prospectus (other than the financial statements and supporting
schedules included therein or omitted therefrom, as to which
such counsel need express no opinion), when they were filed
with the Commission, complied as to form in all material
respects with the requirements of the Exchange Act and the
rules and regulations of the Commission thereunder.
(xi) The Shares to be issued and sold by the Company
to purchasers solicited by the Agents hereunder have been duly
authorized and, when issued and delivered to such purchasers
against payment therefor in accordance with the terms hereof,
such Shares will be validly issued, fully paid and
nonassessable and free of any preemptive or similar rights
under the Company's Articles of Incorporation, as amended and
restated, or Code of Regulations, that entitle or will entitle
any person to acquire any Shares upon the issuance thereof by
the Company; provided, however, that such issuance may result
in an adjustment to the number of shares into which the
Company's Series A Convertible Preferred Stock may be
converted and for which the Series A Warrant may be exercised.
(xii) The form of certificates for the Shares
conforms in all material respects to the requirements of the
applicable corporate laws of the State of Ohio.
(xiii) The Registration Statement has become
effective under the Act and, to the knowledge of such counsel,
no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose
are pending before or contemplated by the Commission.
(xiv) The Company has all requisite corporate power
and authority to enter into this Agreement and to issue, sell
and deliver the Shares to be sold by it to purchasers
solicited by the Agents as provided herein, and this Agreement
has been duly authorized, executed and delivered by the
Company and is a valid, legal and binding agreement of the
Company enforceable against the Company in accordance with its
terms, except to the extent enforceability may be limited by
bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium or other similar laws relating to or affecting
enforcement of creditors' rights generally or by general
equitable principles, and except to the extent enforceability
of the provisions relating to indemnity and contribution for
liabilities under the Act may be limited by or under the Act,
or by public policy.
(xv) Neither the offer, sale or delivery of the
Shares by the Company, the execution, delivery or performance
of this Agreement by the Company, compliance by the Company
with all provisions hereof nor consummation by the Company of
the transactions contemplated hereby (A) conflicts with or
constitutes a breach of, or a default under, articles of
incorporation or code of regulations, or (B) violates any
existing law, statute, regulation, ruling (assuming compliance
with all applicable state securities and Blue Sky laws),
judgment, injunction, order or decree of New York law, the
laws of
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the United States or the provisions of the Ohio Revised Code
which are applicable to the Company or any of its properties
and of which such counsel is aware.
(xvi) The Registration Statement and the Prospectus
and any supplements or amendments thereto (except for the
financial statements and the notes thereto and the schedules
and other financial and statistical data included therein, as
to which such counsel need not express any opinion),
excluding, in each case, the documents incorporated by
reference, comply as to form in all material respects with the
requirements of the Act.
(xvii) The descriptions in the Prospectus of
statutes, regulations or legal or governmental proceedings,
insofar as they purport to summarize certain of the provisions
thereof, are accurate and fairly present the information
required to be presented by the Act and the rules and
regulations thereunder.
(xviii) The statements (A) in the Company's Annual
Report on Form 10-K for the fiscal year ended June 30, 1999
under the captions "Business-- Environmental Regulation,"
"Legal Proceedings" (but only as to the first and second
paragraphs under such heading) and "Certain Transactions with
Directors and Officers," (as such statements shall have been
amended, superseded or supplemented by any Form 10-K/A for the
fiscal year ended June 30, 1999, Current Report on Form 8-K or
Quarterly Report on Form 10-Q filed by the Company after June
30, 1999), (B) in the Prospectus under the caption "Plan of
Distribution" and (C) in the Registration Statement in Items
14 and 15, in each case insofar as such statements constitute
summaries of the legal matters, documents or proceedings
referred to therein, fairly present the information called for
with respect to such legal matters, documents and proceedings
and fairly summarize the matters referred to therein;
(xix) The Company is not an "investment company" as
such term is defined in the Investment Company Act of 1940, as
amended.
In rendering such opinion, counsel may rely, to the extent
they deem such reliance proper, as to matters of fact upon certificates
of officers of the Company and of government officials, provided that
counsel shall state their belief that they and you are justified in
relying thereon. Copies of all such certificates shall be furnished to
you and your counsel on the Closing Date.
In addition to the opinion set forth above, such counsel shall
state that during the course of their participation in the preparation
of the Registration Statement and the Prospectus and the amendments
thereto, nothing has come to the attention of such counsel which has
caused them to believe or given them reason to believe that the
Registration Statement or the Prospectus or any amendment thereto
(except for the financial statements and other financial, accounting
and statistical information, or industry data attributed to an
identified source, contained therein or omitted therefrom as to which
no belief need be expressed), at the date thereof, 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 Registration Statement or the
Prospectus as of the date of the opinion (except as aforesaid),
contains
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an untrue statement of a material fact or omits to state a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
In rendering such opinion, in each case where such opinion is
qualified by "the knowledge of such counsel" or "known to such
counsel," such counsel may rely as to matters of fact upon certificates
of executive and other officers and employees of the Company as you and
such counsel shall deem are appropriate and such other procedures as
you and such counsel shall mutually agree; provided, however, in each
such case, such counsel shall state that it has no knowledge contrary
to the information contained in such certificates or developed by such
procedures and knows of no reason why you should not reasonably rely
upon the information contained in such certificates or developed by
such procedures. Such counsel may state in such opinion that its
knowledge is limited to the knowledge of its attorneys and other
representatives and employees that have given attention to the
Company's matters in connection with the transactions contemplated by
this Agreement.
(d) You shall have received on the Closing Date an opinion of
Xxxxxx & Killeen, special counsel to the Company, substantially to the
effect that:
(i) The statements included or incorporated by
reference into the Prospectus under the captions "Risk
Factors-If We Are Unable to Protect Our Important Patents and
Trade Secrets or If Others Enforce Rights Against Us, Our
Business May Suffer" and "Business-Intellectual Property", and
in the fourth paragraph under the caption "Certain Legal
Proceedings" insofar as such statements constitute a summary
of the matter relating to the notice received by the Company's
DSI subsidiary from a competitor regarding possible patent
infringement, or the patent position of the Company, fairly
present the information called for with respect to such
matters and fairly summarize the matters referred to therein.
(ii) Such counsel has no knowledge of any litigation
relating to intellectual property which, separately or in the
aggregate, could reasonably be expected to have a material
adverse effect on the Company.
(iii) Such counsel has no knowledge of any proceeding
relating to intellectual property owned or used by the Company
other than the matter related to the Company's DSI subsidiary
noted above or an opposition by the same competitor to DSI's
European Patent No. 0516436.
(iv) Except as set forth in the aforementioned
sections included or incorporated by reference in the
Prospectus, such counsel has no knowledge that the Company is
infringing or otherwise violating the intellectual property
rights of others and the Company is not subject to any current
claim or notice of infringement or other violation of any
intellectual property rights of others.
(v) All of the pending patent applications filed by
such counsel on behalf of the Company were filed in accordance
with the rules and regulations of the U.S.
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Patent and Trademark Office (the "PTO") and all such
applications have received a filing date from the PTO.
In rendering such opinion, such counsel may rely, as to
matters of fact (but not as to legal conclusions), to the
extent they deem proper, on certificates of responsible
officers of the Company and public officials. Such opinion
shall not state that it is to be governed or qualified by, or
that it is otherwise subject to, any treatise, written policy
or other document relating to legal opinions, including,
without limitation, the Legal Opinion Accord of the ABA
Section of Business Law (1991).
(e) You shall have received on the Closing Date an opinion of
Crosby, Heafey, Xxxxx & May, special counsel for the Company, dated the Closing
Date with respect to certain intellectual property matters, in form and
substance reasonably acceptable to you and your counsel.
In rendering such opinion, such counsel may rely, as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials. Such
opinion shall not state that it is to be governed or qualified by, or that it is
otherwise subject to, any treatise, written policy or other document relating to
legal opinions, including, without limitation, the Legal Opinion Accord of the
ABA Section of Business Law (1991).
(f) You shall have received on the Closing Date an opinion of
Xxxxx & Xxxx LLP, as counsel for the Agents, dated the Closing Date with respect
to the issuance and sale of the Shares, the Registration Statement and other
related matters as you may reasonably request, and the Company and its counsel
shall have furnished to your counsel such documents as they may reasonably
request for the purpose of enabling them to pass upon such matters.
(g) You shall have received letters addressed to you and dated
the date hereof and the Closing Date from (i) the firms of Xxxxx Xxxxxxxx LLP
and Ernst & Young LLP, independent certified public accountants, and (ii) the
Chief Financial Officer of the Company, substantially in the forms heretofore
approved by you.
(h) (i) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall be pending or, to the knowledge of the Company, shall be
threatened or contemplated by the Commission at or prior to the Closing Date;
(ii) no order suspending the effectiveness of the Registration Statement or the
qualification or registration of the Shares under the securities or Blue Sky
laws of any jurisdiction shall be in effect and no proceeding for such purpose
shall be pending or, to the knowledge of the Company, threatened or contemplated
by the Commission or the authorities of any jurisdiction; (iii) any request for
additional information on the part of the staff of the Commission or any such
authorities shall have been complied with to the satisfaction of the staff of
the Commission or such authorities; (iv) after the date hereof no amendment or
supplement to the Registration Statement or the Prospectus shall have been filed
unless a copy thereof was first submitted to you and you did not object thereto
in good faith; and (v) all of the representations and warranties of the Company
contained in this Agreement shall be true and correct in all material respects
(except for such representations and warranties qualified by materiality, which
representations and warranties shall be true and correct in all respects) on and
as of the date
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hereof and on and as of the Closing Date as if made on and as of the Closing
Date, and you shall have received a certificate, dated the Closing Date and
signed by the chief executive officer and the chief financial officer of the
Company (or such other officers as are acceptable to you) to the effect set
forth in this Section 9(h) and in Sections 9(b) and 9(i) hereof.
(i) The Company shall not have failed in any material respect
at or prior to the Closing Date to have performed or complied with any of its
agreements herein contained and required to be performed or complied with by it
hereunder at or prior to the Closing Date.
(j) The Company shall have furnished or caused to have been
furnished to you such further certificates and documents as you shall have
reasonably requested.
(k) At or prior to the Closing Date, you shall have received
Lock-Up Agreements, in the form attached hereto as Exhibit A, from each of the
parties listed in Schedule I hereto.
(l) At or prior to the Closing Date, you shall have received a
Lock-Up Agreement, in the form attached hereto as Exhibit B, from General
Electric Company Capital Corporation.
(m) At or prior to the effective date of the Registration
Statement, you shall have received a letter from the Corporate Financing
Department of the NASD confirming that such Department has determined to raise
no objections with respect to the fairness or reasonableness of the terms and
arrangements of the offering contemplated hereby.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are reasonably satisfactory
in form and substance to you and your counsel.
If any of the conditions hereinabove provided for in this Section 9
shall not have been satisfied when and as required by this Agreement, this
Agreement may be terminated by you by notifying the Company of such termination
in writing or by telegram at or prior to such Closing Date, but you shall be
entitled to waive any of such conditions. If this Agreement is terminated in
accordance with this paragraph, the parties hereto agree that neither the
purchaser of any Shares nor the Agents shall be required to transfer any funds
to, or to the order of, the Company pursuant to this Agreement and the Company
shall, in respect of the resulting failure by the Company to deliver Shares to a
purchaser whose offer has been solicited by an Agent and accepted by the
Company, (i) hold such Agent harmless against any loss, claim or damage arising
from or as a result of such failure to deliver the Shares and (ii) pay to such
Agent the commission set forth herein to which it would otherwise be entitled
absent such termination of the Agreement.
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10. EFFECTIVE DATE OF AGREEMENT. This Agreement shall become effective
upon the execution and delivery hereof by the parties hereto; provided, however,
that the provisions of Sections 7 and 8 shall at all times be effective.
11. [reserved]
12. INFORMATION FURNISHED BY THE AGENTS. The Company acknowledges that
the first and second full paragraphs on page S-18 (in the section entitled "Plan
of Distribution") in the Prospectus constitute the only information furnished by
or on behalf of the Agents through you or on your behalf as such information is
referred to in Sections 6(a), 6(b) and 8 hereof.
13. MISCELLANEOUS. Except as otherwise provided in Section 5 and 11
hereof, notice given pursuant to any of the provisions of this Agreement shall
be in writing and shall be delivered (i) to the Company to the office of the
Company at 00000 Xxxxxx Xxxx, Xxxxx, Xxxx 00000, Att: Xxxxxxxx Xxxxx (With a
copy to Xxxxxx, Xxxxxxxx & Sarlson., L.P.A., 0000 Xxxxxxxx Xxxxx, Xxxxxxxxx,
Xxxx 00000, Att: Xxxxx X. Xxxx, Esq.), or (ii) if to you, as representative of
the Agents, to Xxxxxxx Xxxxx & Associates, Inc., 000 Xxxxxxxx Xxxxxxx, Xx.
Xxxxxxxxxx, Xxxxxxx 00000, Attention: Xxxxxx Xxxxxxxx, Managing Director (with
copy to Xxxxx & Xxxx LLP, Xxx Xxxxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Att:
Xxxxxxxx X. Xxxxxx, Esq.).
This Agreement has been and is made solely for the benefit of the
several Agents, the Company and its respective directors and officers.
14. APPLICABLE LAW; COUNTERPARTS. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York without
reference to choice of law principles thereunder.
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
This Agreement shall be effective when, but only when, at least one
counterpart hereof shall have been executed on behalf of each party hereto.
The Company and the Agents each hereby irrevocably waive any right they
may have to a trial by jury in respect to any claim based upon or arising out of
this Agreement or the transactions contemplated hereby.
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Please confirm that the foregoing correctly sets forth the agreement
among the Company, and the several Agents.
Very truly yours,
Advanced Lighting Technologies, Inc.
By:/s/Xxxxx X. Xxxxxxx
---------------------------------
Chief Executive Officer
CONFIRMED as of the date first above mentioned.
XXXXXXX XXXXX & ASSOCIATES, INC.
By: /s/Xxxxxx Xxxxxxxx
-------------------------------
Authorized Representative
XXXXXXX XXXXXX XXXXXX INC.
By: /s/Xxxxxxx X. Xxxxxxxxxxx
-------------------------------
Authorized Representative
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SCHEDULE I
Xxxxx X. Xxxxxxx
Xxxx X. Xxxx
Xxxxx X. Xxxx
Xxxxxxxx X. Xxxxx
Xxxxxxx X. Xxxx
Xxxx X. Xxxxx
Xxxx X. Xxxxxxx
Xxxxxxxx X. Xxxxxx
Xxxxxx Xxxxxx
Xxxxxx X. Lime
A Xxxxxx Xxxxxxxx
Xxxxx X. Xxxxxxxxxx
Xxxxx X. Xxxxxxxxxxxx
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SCHEDULE II
Venture Lighting International Inc.
APL Engineered Materials, Inc.
Ruud Lighting, Inc.
Deposition Sciences, Inc.
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EXHIBIT A
ADVANCED LIGHTING TECHNOLOGIES, INC.
00000 Xxxxxx Xxxx
Xxxxx, Xxxx 00000
XXXXXXX XXXXX & ASSOCIATES, INC.
and the other Agents referred to below
c/o Raymond Xxxxx & Associates, Inc.
000 Xxxxxxxx Xxxxxxx
Xx. Xxxxxxxxxx, XX 00000
RE: ADVANCED LIGHTING TECHNOLOGIES, INC. (THE "COMPANY") - RESTRICTION ON
STOCK SALES
Dear Sirs:
This letter is delivered to you pursuant to the Agency Agreement (the
"Agency Agreement") to be entered into by the Company, as issuer, and Xxxxxxx
Xxxxx & Associates, Inc. and the other agents named therein, as agents (the
"Agents"). Upon the terms and subject to the conditions of the Agency Agreement,
the Agents intend to effect a public offering (the "Offering") of Common Stock,
par value $.001 per share, of the Company (the "Common Stock"), as described in
and contemplated by the prospectus contained in the registration statement of
the Company on Form S-3, File No. 333-58613 (the "Registration Statement"), as
declared effective by the Securities and Exchange Commission on July 13, 2000,
and the prospectus supplement thereto, relating to the Offering (such prospectus
and prospectus supplement are referred to herein as the "Prospectus").
The undersigned recognizes that it is in the best financial interests
of the undersigned, as an officer or director, and/or owner of stock, options,
warrants or other securities of the Company (the "Company Securities"), that the
Company complete the proposed Offering.
The undersigned further recognizes that the Company Securities held by
the undersigned are, or may be, subject to certain restrictions on
transferability, including those imposed by United States federal securities
laws. Notwithstanding these restrictions, the undersigned has agreed to enter
into this letter agreement to further assure the Agents that the Company
Securities of the undersigned, now held or hereafter acquired, will not enter
the public market at a time that might impair the efforts contemplated by the
Agency Agreement.
Therefore, as an inducement to the Agents to execute the Agency
Agreement, the undersigned hereby acknowledges and agrees that the undersigned
will not (i) offer, sell, contract to sell, pledge, grant any option to purchase
or otherwise dispose of (collectively, a "Disposition") any shares of the
Company's capital stock, or any securities convertible into or exercisable or
exchangeable for, or any rights to purchase or otherwise acquire, any shares of
the Company's capital stock held by the undersigned or acquired by the
undersigned after the date hereof, or which may be deemed to be beneficially
owned by the undersigned (collectively, the
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"Lock-Up Shares"), pursuant to the rules and regulations promulgated under the
Securities Act of 1933, as amended (the "Securities Act"), and the Securities
Exchange Act of 1934, as amended, for a period commencing on the date hereof and
ending 90 days after the date of the Company's final Prospectus filed pursuant
to Rule 424(b) under the Securities Act, inclusive (the "Lock-Up Period"),
without the prior written consent of Xxxxxxx Xxxxx & Associates, Inc., or (ii)
exercise or seek to exercise or effectuate in any manner any rights of any
nature that the undersigned has or may have hereafter to require the Company to
register under the Securities Act the undersigned's sale, transfer or other
disposition of any of the Lock-Up Shares or other securities of the Company held
by the undersigned, or to otherwise participate as a selling securityholder in
any manner in any registration effected by the Company under the Securities Act,
including under the Registration Statement, during the Lock-Up Period. The
foregoing restrictions are expressly agreed to preclude the undersigned from
engaging in any hedging, collar (whether or not for any consideration) or other
transaction which is designed to or reasonably expected to lead or result in a
Disposition of Lock-Up Shares during the Lock-Up Period, even if such Lock-Up
Shares would be disposed of by someone other than such holder. Such prohibited
hedging or other transactions would include, without limitation, any short sale
(whether or not against the box) or any purchase, sale or grant of any right
(including, without limitation, any put or call option or reversal or
cancellation thereof) with respect to any Lock-Up Shares or with respect to any
security (other than a broad-based market basket or index) that includes,
relates to or derives any significant part of its value from Lock-Up Shares.
Notwithstanding the agreement not to make any Disposition during the
Lock-Up Period, you have agreed that the foregoing restrictions shall not apply
to the sale of any shares of common stock subject to a pledge or other security
arrangement existing on the date hereof, made in good faith pursuant to the
terms of the pledge or other security arrangement. This exception only applies
to pledges and other security arrangements of which the undersigned has informed
you.
It is understood that, if the Agency Agreement (other than the
provisions thereof which survive termination) shall terminate or be terminated
prior to payment for and delivery of the shares of Common Stock the subject
thereof, you will release the undersigned from the obligations under this letter
agreement.
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In furtherance of the foregoing, the Company and its transfer agent and
registrar are hereby authorized to decline to make any transfer of Lock-Up
Shares if such transfer would constitute a violation or breach of this letter.
This letter shall be binding on the undersigned and the respective successors,
heirs, personal representatives and assigns of the undersigned. Capitalized
terms used but not defined herein have the respective meanings assigned to such
terms in the Agency Agreement.
Very truly yours,
Signature of Securityholder
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EXHIBIT B
August , 2000
ADVANCED LIGHTING TECHNOLOGIES, INC.
00000 Xxxxxx Xxxx
Xxxxx, Xxxx 00000
XXXXXXX XXXXX & ASSOCIATES, INC.
and the other Agents referred to below
c/o Raymond Xxxxx & Associates, Inc.
000 Xxxxxxxx Xxxxxxx
Xx. Xxxxxxxxxx, XX 00000
RE: ADVANCED LIGHTING TECHNOLOGIES, INC. (THE "COMPANY") - RESTRICTION ON
STOCK SALES
Dear Sirs:
This letter is delivered to you pursuant to the Agency Agreement (the
"Agency Agreement") to be entered into by the Company, as issuer, and Xxxxxxx
Xxxxx & Associates, Inc. ("RJ") and the other agents named therein, as agents
(the "Agents"). Upon the terms and subject to the conditions of the Agency
Agreement, the Agents intend to effect a public offering (the "Offering") of
Common Stock, par value $.001 per share, of the Company (the "Common Stock"), as
described in and contemplated by the prospectus contained in the registration
statement of the Company on Form S-3, File No. 333-58613 (the "Registration
Statement"), as declared effective by the Securities and Exchange Commission on
July 13, 2000, and the prospectus supplement thereto, relating to the Offering
(such prospectus and prospectus supplement are referred to herein as the
"Prospectus").
The undersigned recognizes that it is in the best financial interests
of the undersigned, as an officer or director, and/or owner of stock, options,
warrants or other securities of the Company (the "Company Securities"), that the
Company complete the proposed Offering.
The undersigned further recognizes that the Company Securities held by
the undersigned are, or may be, subject to certain restrictions on
transferability, including those imposed by United States federal securities
laws. Notwithstanding these restrictions, the undersigned has agreed to enter
into this letter agreement to further assure the Agents that the Company
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Securities of the undersigned, now held or hereafter acquired, will not enter
the public market at a time that might impair the efforts contemplated by the
Agency Agreement.
Therefore, as an inducement to the Agents to execute the Agency
Agreement, the undersigned hereby acknowledges and agrees that the undersigned
will not (i) offer, sell, contract to sell, pledge, grant any option to purchase
or otherwise dispose of (collectively, a "Disposition") any shares of the
Company's capital stock, or any securities convertible into or exercisable or
exchangeable for, or any rights to purchase or otherwise acquire, any shares of
the Company's capital stock held by the undersigned or acquired by the
undersigned after the date hereof, or which may be deemed to be beneficially
owned by the undersigned (collectively, the "Lock-Up Shares"), pursuant to the
rules and regulations promulgated under the Securities Act of 1933, as amended
(the "Securities Act"), and the Securities Exchange Act of 1934, as amended, for
a period commencing on the date hereof and ending 90 days after the date of the
Company's final Prospectus filed pursuant to Rule 424(b) under the Securities
Act, inclusive (the "Lock-Up Period"), without the prior written consent of RJ,
or (ii) exercise or seek to exercise or effectuate in any manner any rights of
any nature that the undersigned has or may have hereafter to require the Company
to register under the Securities Act the undersigned's sale, transfer or other
disposition of any of the Lock-Up Shares or other securities of the Company held
by the undersigned, or to otherwise participate as a selling securityholder in
any manner in any registration effected by the Company under the Securities Act,
including under the Registration Statement, during the Lock-Up Period. The
foregoing restrictions are expressly agreed to preclude the undersigned from
engaging in any hedging, collar (whether or not for any consideration) or other
transaction which is designed to or reasonably expected to lead or result in a
Disposition of Lock-Up Shares during the Lock-Up Period, even if such Lock-Up
Shares would be disposed of by someone other than such holder. Such prohibited
hedging or other transactions would include, without limitation, any short sale
(whether or not against the box) or any purchase, sale or grant of any right
(including, without limitation, any put or call option or reversal or
cancellation thereof) with respect to any Lock-Up Shares or with respect to any
security (other than a broad-based market basket or index) that includes,
relates to or derives any significant part of its value from Lock-Up Shares.
The undersigned is executing and delivering this letter on the express
understanding that the Company shall execute and deliver the Agency Agreement,
and that each person listed on Schedule A hereto has executed and delivered to
RJ a letter, in each case agreeing to a "lock-up" on terms no less restrictive
than those set forth in this letter. If such understanding is incorrect, this
letter shall immediately become null and void. If the Company or any such other
person who has executed such a lock-up letter is released with respect to some
or all of its or such person's shares of Common Stock, RJ will release the
undersigned's shares from the lock-up provisions set forth herein.
Notwithstanding the foregoing, the undersigned acknowledges that RJ is
consenting to certain "zero cost collar" transactions expected to be entered
into by Messrs. Xxxxx X. Xxxxxxx and Xxxxx X. Xxxx as described in the
prospectus supplement relating to the Offering, and confirms that such
transactions neither render this letter null and void nor result in a release of
the undersigned's shares as aforesaid.
Notwithstanding the agreement not to make any Disposition during the
Lock-Up Period, you have agreed that the foregoing restrictions shall not apply
to (a) transfers of shares of Common Stock to affiliates of the undersigned,
provided however, that any such transferee
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agrees to be bound by the terms of this letter and to enter into a similar
agreement with RJ on its own behalf, (b) private sales of any shares of Common
Stock to a third party in a transaction that is exempt from the registration
requirements of the Securities Act, provided however, that any such purchaser
agrees to be bound by the terms of this letter and to enter into a similar
agreement with RJ on its own behalf, and provided further, that upon any such
sale such securities shall be "restricted securities" within the meaning of Rule
144 under the Securities Act, or (c) the sale of any shares of common stock
subject to a pledge or other security arrangement existing on the date hereof,
made in good faith pursuant to the terms of the pledge or other security
arrangement. Exception (c) only applies to pledges and other security
arrangements of which the undersigned has informed you.
It is understood that, if the Agency Agreement (other than the
provisions thereof which survive termination) shall terminate or be terminated
prior to payment for and delivery of the shares of Common Stock the subject
thereof or if the Offering has not closed by September 30, 2000, this letter
agreement shall terminate and be of no further force and effect.
In furtherance of the foregoing, the Company and its transfer agent and
registrar are hereby authorized to decline to make any transfer of Lock-Up
Shares if such transfer would constitute a violation or breach of this letter.
This letter shall be binding on the undersigned and the respective successors,
heirs, personal representatives and assigns of the undersigned. Capitalized
terms used but not defined herein have the respective meanings assigned to such
terms in the Agency Agreement.
This letter shall be governed by and construed in accordance with the
laws of the State of New York, without regard to principles of conflict of laws.
Very truly yours,
Signature of Securityholder
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