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EXHIBIT 1.5
SURREY, INC.
AGREEMENT AMONG UNDERWRITERS
New York, New York
October __, 1997
Stuart, Coleman & Co., Inc.
As Representative of the Several Underwriters
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
1. Underwriting Agreement. We understand that Surrey, Inc. a Texas
corporation (the "Company"), proposes to enter into an underwriting agreement
in the form attached hereto as Exhibit A (the "Underwriting Agreement") with
the underwriters named in Schedule A to the Underwriting Agreement (the
"Underwriters") acting severally and not jointly with respect to the purchase
of an aggregate of 625,000 units of the Company. Each Unit consists of one
share of Common Stock, no par value ("Common Stock"), and one Redeemable Common
Stock Purchase Warrant (the "Warrants"). The Warrants are exercisable between
________________, 1997 and _____________, 2002 at an exercise price of $4.80 to
purchase one share of Common Stock. The Warrants are severable and will be
separately traded at the option of the Representative. The Representative may
decide to withdraw the Units immediately after the thirty (30) day minimum
inclusion period.
Unless the context indicates otherwise, the term "Units" shall also
include an additional 93,750 Units, all or any part of which the
Representative, individually and not as Representative of the Underwriters, is
entitled to purchase from the Company upon exercise of the Representative's
option referred to in Section 4.01(b) of the Underwriting Agreement.
This is to confirm that we agree to purchase, in accordance with
the terms hereof and of the Underwriting Agreement, the number of Units
set forth opposite our name in Schedule A to the Underwriting Agreement, plus
such number of Units, if any, which we may become obligated to purchase
pursuant to Section 4 hereof ("our Units"). The ratio which the number of our
Units bears to the total number of Units purchased pursuant to the Underwriting
Agreement is herein called "our underwriting proportion."
2. Registration Statement and Prospectus. We have heretofore received and
examined a copy of the registration statement, as amended to the date hereof,
and the related prospectus in respect of the Units, as filed with the
Securities and Exchange Commission. The registration statement, as amended at
the time it becomes effective, including financial statements and exhibits, is
hereinafter referred to as the "Registration Statement," and the
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prospectus in the form first filed with the Securities and Exchange
Commission pursuant to Rule 424(b) after the Registration Statement becomes
effective is referred to as the "Prospectus."
We confirm that the information furnished to you by us for use in
the Registration Statement and in the Prospectus is correct and is not
misleading insofar as it relate to us. We consent to being named as an
Underwriter in such Registration Statement and we are willing to accept our
responsibilities under the Securities Act of 1933, as amended ("Securities
Act") as a result thereof. We confirm that we have authorized you to advise
the Company on our behalf (a) as to the statements to be included in any
Preliminary Prospectus and in the Prospectus under the heading "Underwriting"
insofar as they relate to us and (b) that there is no other information about
us required to be stated in the Registration Statement or Prospectus. We
further confirm that, upon request by you, as Representative, we have furnished
a copy of any amended preliminary prospectus to each person to whom we have
furnished a copy of any previous preliminary prospectus, and we confirm that we
have delivered, and we agree that we will deliver, all preliminary and final
prospectuses required for compliance with the provisions of Rule 15c2-8 under
the Securities and Exchange Act of 1934, as amended ("Exchange Act").
3. Authority of the Representative. We authorize you, acting as
Representative, to execute and deliver on our behalf the Underwriting
Agreement, and to agree to any variation of its terms (except as to the
purchase price and the number of our Units) which, in your judgment, is not a
variation which materially and adversely affects our rights and obligations.
We also authorize you, in your discretion and on our behalf, with approval of
counsel for the Underwriters, to approve the Prospectus and to approve of, or
object to, any further amendments to the Registration Statement, or amendments
or supplements to the Prospectus. We further authorize you to exercise all the
authority and discretion vested in the Underwriters and in you by the
provisions of the Underwriting Agreement and to take all such action as you, in
your discretion, may believe desirable to carry out the provisions of the
Underwriting Agreement and of this Agreement, including the extension of any
date specified in the Underwriting Agreement, the exercise of any right of
cancellation or termination, and to determine all matters relating to the
public advertisement of the Units; provided, however, that except with the
consent of Underwriters who shall have agreed to purchase in the aggregate 50%
or more of the Units, no extension of the time by which the Registration
Statement is to become effective, as provided in Section 8 of the Underwriting
Agreement, shall be for a period in excess of two business days. We authorize
you to take such action as in your discretion may be necessary or desirable to
effect the sale and distribution of the Units, including, without limiting the
generality of the foregoing, the right to determine the terms of any proposed
offering, the concession to Selected Dealers (as hereinafter defined) and the
reallowance, if any, to other dealers and the right to make the judgments
provided for in Sections 8, 9, and 10 of the Underwriting Agreement.
4. Authority of Representative as to Defaulting Underwriters. Until the
termination of this Agreement, we authorize you to arrange for the purchase by
other persons, who may include you or any of the other Underwriters, of any
Units not taken up by any defaulting Underwriter. In the event that such
arrangements are made, the respective amounts of the Units to be purchased by
the non-defaulting Underwriters and by such other person or
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persons, if any, shall be taken as the basis for all rights and
obligations hereunder; but this shall not in any way affect the liability of
any defaulting Underwriter to the other Underwriters for damages resulting from
its default, nor shall any such default relieve any other Underwriter of any of
its obligations hereunder or under the Underwriting Agreement except as herein
or therein provided.
In the event of default by one or more Underwriters in respect of
their obligations (a) under the Underwriting Agreement to purchase the
Units agreed to be purchased by them thereunder, or (b) under this Agreement to
take up and pay for any Units purchased, or (c) to deliver any Units sold or
over-allotted by you for the respective accounts of the Underwriters pursuant
to Section 11 hereof, or to bear their respective share of expenses or
liabilities pursuant to Section 13, 15 and 16 hereof, and to the extent that
arrangements shall not have been made by you for any persons to assume the
obligations of such defaulting Underwriter or Underwriters, we agree to assume
our proportionate share of the obligations of each defaulting Underwriter or
Underwriters (subject in the case of clause (a) above to the limitations
contained in Section 5 hereof without relieving any such defaulting Underwriter
or Underwriters of its liability therefor.
5. Substitution of Underwriters. If any Underwriter shall for any
reason not permitted hereunder cancel their obligation to purchase the
Units hereunder, or shall fail to take up and pay for the number of Units set
forth opposite their respective names in Schedule A of the Underwriting
Agreement upon tender of such Units in accordance with the terms hereof, then:
(a) If the aggregate number of Units which such
Underwriter or Underwriters agreed but failed to purchase does not
exceed 10% of the total number of Units, the other Underwriters shall be
obligated severally, in proportion to their respective commitments hereunder,
to purchase the Units which such defaulting Underwriter or Underwriters agreed
but failed to purchase.
(b) If any Underwriter or Underwriters so default and the
agreed number of Units with respect to such default or defaults occurs
in more than 10% of the total number of Units, the remaining Underwriters shall
have the right to take up and pay for (in such proportion as may be agreed upon
among them) the Units which the defaulting Underwriter or Underwriters agreed
but failed to purchase, the time for delivery of the Units shall be extended to
the next business day to allow the several Underwriters the privilege of
substituting within twenty-four hours (including non-business hours) another
underwriter or underwriters satisfactory to the Company.
As used in this Agreement, the term "Underwriter"
includes any person substituted for an Underwriter under this Section.
In the event of termination, there shall be no liability on the part of any
non-defaulting Underwriter to the Company, provided that the provisions of this
Section 5 shall not affect the liability of any defaulting Underwriter to the
Company arising out of such default.
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6. Offering of Units. We understand that you will notify us when
the initial public offering of the Units is to be made and of the
initial public offering price. We hereby authorize you, in your sole
discretion, after the initial public offering, to change the public offering
price, the concession and the reallowance. The offering price at any time in
effect is hereinafter referred to as the "public offering price". We agree
that we will not offer any of the Units for sale at a price other than the
public offering price or allow any discount therefrom except as herein
otherwise specifically provided.
We agree that public advertisement of the offering shall be
made by you on behalf of the Underwriters on such date as you shall
determine. We have not advertised the offering and will not do so until after
such date. We understand that any advertisement we may then make will be our
own responsibility and at our own expense.
We authorize you to reserve and offer for sale to institutions
and other retail purchasers and to dealers (the "Selected Dealers") to
be selected by you (such dealers may include any Underwriter) such of our Units
as you, in your sole discretion, shall determine. Any such offering to
Selected Dealers may be made pursuant to a Selling Agreement, in the form
attached hereto as Exhibit B, or otherwise, as you may determine. The form of
Selling Agreement attached hereto as Exhibit B is satisfactory to us.
We authorize you to make purchases and sales of the Units from
or to any Selected Dealers or Underwriters at the public offering
price, less all or any part of the concession and, with your consent, any
Underwriter may make purchases or sales of the Units from or to any Selected
Dealer or Underwriter at the public offering price, less all or any part of the
concession.
We understand that you will notify each Underwriter promptly
upon the release of the Units for public offering as to the amount of
Units reserved for sale to Selected Dealers and retail purchasers. Units not
so reserved may be sold by each Underwriter for its own account, except that
from time to time you may, in your discretion, add to the Units reserved for
sale to Selected Dealers and retail purchasers any Units retained by an
Underwriter remaining unsold. We agree to notify you, from time to time, upon
request, of the amount of our Units retained by us remaining unsold. If all
of the Units reserved for offering to Selected Dealers and retail purchasers
are not promptly sold by you, any Underwriter may, from time to time, with your
consent, obtain a release of all or any Units of such Underwriter then
remaining unsold, and Units so released shall thereafter be deemed not to have
been reserved. Units of any Underwriter so reserved which remain unsold, or,
if sold, have not been paid for at any time prior to the termination of this
Agreement may, in your discretion or upon the request of such Underwriter, be
delivered to such Underwriter for carrying purposes only, but such Units shall
remain subject to redelivery to you upon demand for disposition by you until
this Agreement is terminated.
We agree that in connection with sales and offers to sell the
Units, if any, made by us outside the United States or its territories
or possessions, (a) we will furnish to each person to whom any such offer or
sale is made such prospectus, advertisement or other offering document
containing information relating to the Units or the Company, as may be required
under
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the laws of the jurisdiction in which such offer or sale is made and
(b) we will furnish to each person to whom any such offer is made a copy of the
then current preliminary prospectus, and to each person to whom any such sale
is made, a copy of the Prospectus referred to in the Underwriting Agreement (as
then amended or supplemented if the Company shall have furnished any amendments
or supplements thereto). Any prospectus, advertisement or other offering
document (other than any such preliminary prospectus or Prospectus) furnished
by us to any person in accordance with the preceding sentence and all such
additional offering material, if any, as we may furnish to any person (i) shall
comply in all respects with the laws of the jurisdiction in which it is so
furnished, (ii) shall be prepared and so furnished at our sole risk and
expense, and (iii) shall not contain information relating to the Units or the
Company which is inconsistent in any respect with information contained in the
then current preliminary prospectus or in the Prospectus (as then amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto), as the case may be.
We recognize the importance of a broad distribution of the
Units among bona fide investors and we agree to use our best efforts to
obtain such broad distribution and, to that end, to the extent we deem
practicable, to give priority to small orders.
We agree that we will not sell to any account over which we
exercise discretionary authority any of the Units which we have agreed
to purchase pursuant to the Underwriting Agreement.
7. Repurchases in the Open Market. We agree that any Units sold
by any Underwriter (other than through you) which, prior to the
termination of this Agreement or such earlier date as you may
determine, shall be contracted for or purchased in the open market by you, on
behalf of the Underwriters, for a price that is at or below the public offering
price and is not greater than the inside bid price at the time of such contract
or purchase, shall be repurchased by such Underwriters on demand at a price
equal to the cost of such purchase (including commissions and taxes paid in
connection with such purchase) plus commissions and taxes on redelivery. Any
Units delivered on such repurchases need not be the identical Units originally
sold by such Underwriter. In lieu of delivery of such Units to such
Underwriter, you may (a) sell such Units in any manner for such Underwriter's
account and charge such Underwriter with the amount of any loss or expense, or
credit such Underwriter with the amount of any profit less any expense,
resulting from such sale, or (b) charge such Underwriter's account with an
amount not in excess of the concession to Selected Dealers on such Units, plus
commissions and taxes paid on delivery of such purchase.
8. Compensation to Representative. We authorize you to charge to
our account, as compensation for your services as Representative in
connection with this offering, including the purchase from the Company of the
Units and the management of the offering, an amount equal to $_______________
per Unit in respect to each of our Units.
9. Payment and Delivery. At or before 9:00 a.m., New York City
time, on the Closing Date as defined in the Underwriting Agreement, we
agree to deliver to you at your office a certified or official bank check
payable in New York Clearing House funds to your
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order, in an amount equal to the initial public offering price, less
the concession to the Selected Dealers in respect of that portion of our Units
which has been retained by or released to us for direct sales.
In the event that our funds are not received by you when
required, you are authorized, in your discretion, but shall not be
obligated, to make payment for our account pursuant to the Underwriting
Agreement by advancing your own funds. Any such payment by you shall not
relieve us from any of our obligations hereunder or under the Underwriting
Agreement.
We authorize you to hold and deliver against payment any of
our Units which have been sold or reserved for sale to Selected Dealers
or retail purchasers. Any of our Units not sold or reserved by you as
aforesaid will be available for delivery to us at your office as soon as
practicable after such Units have been delivered to you.
Upon the termination of this Agreement, or prior thereto at your
discretion, you will deliver to us any of our Units reserved by you for sale to
Selected Dealers or retail purchasers, but not sold an paid for against payment
by us of an amount equal to the initial public offering price of such Units,
less the concession to the Selected dealers in respect thereof.
10. Authority to Borrow. We authorize you to arrange loans for our
account and to execute and deliver any notes or other instruments in connection
wherewith, and to pledge as security therefor all or any part of our Units, as
you may deem necessary or advisable to carry out the purchase, carrying and
distribution of the Units, and to advance your own funds, charging current
interest rates.
11. Over-allotment; Stabilization. We authorize you, for the
account of each Underwriter, prior to the termination of this
Agreement, and for such longer period as may be necessary to cover any short
position incurred for the accounts of the several Underwriters pursuant to this
Agreement, (a) to over-allot in arranging for sales of Units to Selected
Dealers and others and, if necessary, to purchase Units (whether pursuant to
exercise of the option set forth in Section 4.01(b) of the Underwriting
Agreement or otherwise) at such prices as you may determine for the purpose of
covering such over-allotments, and (b) for the purpose of stabilizing the
market in the Units, to make purchase and sale of Units on the open market or
otherwise, for long or short account, on a when-issued basis or otherwise, at
such prices, in such amounts and in such manner as you may determine; provided,
however, that at no time shall our net commitment, either for long or short
account, under this Section 11 exceed 15% of the amount of our Units. Such
purchases, sales and over-allotments shall be made for the respective accounts
of the several Underwriters as nearly as practicable to their respective
underwriting proportions. We agree to take up on demand at cost any Units so
purchased for our account and deliver on demand any Units so sold or
over-allotted for our account. We authorize you to sell for the account of the
Underwriters any Units purchased pursuant to this Section 11, upon such terms
as you may deem advisable, and any Underwriter, including yourselves, may
purchase such Units. You are authorized to charge the respective accounts of
the Underwriters with broker's commissions or dealer's xxxx-up on purchase and
sales effected by you.
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If pursuant to the provision of the preceding paragraph and
prior to the termination of this Agreement (or prior to such earlier
date as you may have determined) you purchase or contract to purchase for the
account of any Underwriter in the open market or otherwise any Units which were
retained by, or released to, us for direct sale, or any Units which may have
been issued in exchange for such Units, we authorize you either to charge our
account with an amount equal to the concession of such Units, or to require us
to repurchase such Units at a price equal to the total cost of such purchase,
including transfer taxes and broker's commissions or dealer's xxxx-up, if any.
In lieu of such action you may, in your discretion, sell for our account the
Units so purchased and debit or credit our account for the loss or profit
resulting from such sale.
You will notify us promptly if and when you engage in any
stabilization transaction pursuant to this Section 11 or otherwise and
will notify us of the date of termination of stabilization. We agree to file
with you any reports required of us including "Not as Manager" reports pursuant
to Rule 17a-2 under the Exchange Act not later than five business days
following the day upon which such stabilization transaction was terminated, and
we authorize you to file on our behalf with the Securities and Exchange
Commission any reports required by such rule.
12. Limitation on Transactions by Underwriters. Except as
permitted by you, we will not, during the term of this Agreement, bid
for, purchase, sell or attempt to induce others to purchase or sell, directly
or indirectly, any Units other than (i) as provided in the Underwriting
Agreement and in this agreement, (ii) purchases from or sales to dealers of the
units at the public offering price, less all or any part of the reallowance to
dealers, or (iii) purchases or sales by us of any Units as broker or
unsolicited orders for the account of others.
We represent that we have not participated in any transaction
prohibited by the preceding paragraph and that we have at all times
complied with the provisions of Regulation M of the Securities and Exchange
Commission applicable to this offering.
We may, with your prior consent, make purchases of the Units
from and sales to other Underwriters at the public offering price, less
all or any part of the concession to dealers.
13. Allocation and Payment of Expenses. We understand that all
expenses of a general nature incurred by you, as Representative, in
connection with the purchase, carrying, marketing and sale of the Units shall
be borne by the Underwriters in accordance with their respective share
of the underwriting obligations. We authorize you to charge our account with
our share, based on our underwriting obligation, of the aforesaid expenses,
including all transfer taxes paid on our behalf on sales or transfers made for
our account.
As promptly as possible after the termination of this Agreement, the
accounts arising pursuant hereto shall be settled and paid. Your ascertainment
of all expenses and the apportionment thereof shall be conclusive.
Notwithstanding any settlement or
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settlements hereunder, we will remain liable for our share of all
expenses and liabilities which may be incurred by or for the accounts of the
Underwriters, including any expenses and liabilities referred to in Sections 15
and 16(b) hereof, which shall be determined as provided in this Section 13.
14. Termination. Unless this Agreement or any provision hereof is
earlier terminated by you, and except for provisions herein that
contemplate obligations surviving the termination hereof as noted in the next
paragraph, this Agreement will terminate at the close of business on the 30th
day after the date hereof, but in your discretion, may be extended by you for a
further period not exceeding 30 days with the consent of the Underwriters who
have agreed to purchase in the aggregate 50% or more of the Units. No
termination or suspension pursuant to this Section shall affect your authority
under Section 11 to cover any short position under this Agreement.
Upon termination of this Agreement, all authorizations, rights
and obligations hereunder shall cease, except (i) the mutual
obligations to settle accounts under Section 13, (ii) our obligation to pay any
transfer taxes which may be assessed and paid on account of any sales hereunder
for our account, (iii) our obligation with respect to purchases which may be
made by you from time to time thereafter to cover any short position incurred
under this Agreement, (iv) the provisions of Sections 15 and 16 hereunder, and
(v) the obligations of any defaulting Underwriter, all of which shall continue
until fully discharged.
15. Liability of Representative and Underwriters. Neither as
Representative nor individually shall you be under any liability whatsoever to
any other Underwriter, nor shall you be under any liability in respect of any
matters connected herewith or action taken by you pursuant hereto, except for
the obligations expressly assumed by you in this Agreement. You shall be under
no liability for or in respect of the value of the Units or the validity of the
form thereof, the Registration Statement, the Prospectus, or agreements or
other instruments executed by the Company or others; or for or in respect of
the delivery of the Units; or for the performance by the Company or others of
any agreement on its or their part.
Nothing herein contained shall constitute the several
Underwriters an association, or partners with us or with each other,
or, except as herein expressly provided, render any Underwriter liable for the
obligation of any other Underwriter. The rights, obligations and liabilities
of each of the Underwriters are several, in accordance with their respective
obligations, and not joint. Notwithstanding any settlement of accounts under
this Agreement, we agree to pay our underwriting portion of the amount of any
claim, demand or liability which may be asserted against and discharged by the
Underwriters or any of them, based on the claim that the Underwriters
constitute an association, unincorporated business or other entity, and also to
pay our underwriting proportion of expenses approved by you incurred by the
Underwriters, or any of them, in contesting any such claims, demands or
liabilities. If the Underwriters shall be deemed to constitute a partnership
for income tax purposes, it is the intent of each Underwriter to be excluded
from the application of Sub-chapter K, Chapter 1, Subtitle A of the Internal
Revenue Code of 1954, as amended. Each Underwriter elects to be so excluded
and agrees not to take any position inconsistent with such election. Each
Underwriter authorizes
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you, in your discretion, to execute and file on behalf of the
Underwriters such evidence of elections as may be required by the Internal
Revenue Service.
16. Indemnification and Future Claims.
(a) We agree to indemnify and hold harmless you and each other
Underwriter, and each person, if any, who controls you and such other
Underwriter within the meaning of Section 15 of the Securities Act, and to
reimburse their expenses, to the extent and upon the terms that we agree to
indemnify and hold harmless the Company and to reimburse expenses as set forth
in the Underwriting Agreement. Our indemnity agreement set forth in this
Section 16 shall remain in full force and effect regardless of any
investigation made by or on behalf of such other Underwriter or controlling
person and shall survive the delivery of and payment for the Units and the
termination of this Agreement.
(b) In the event that any time any claim or claims shall be
asserted against you, as Representative, or otherwise involving the
Underwriters generally, relating to the Registration Statement or any
preliminary prospectus or the Prospectus, as such may be from time to time
amended or supplemented, the public offering of the Units or any of the
transactions contemplated, by this Agreement, we authorize you to take such
other action as you shall deem necessary or desirable under the circumstances,
including settlement of any such claim or claims if such course of action shall
be recommended by counsel retained by you. We agree to pay to you on request,
our underwriting proportion of all expenses incurred by you (including, but not
limited to, disbursements and fees of counsel so retained) in investigating and
defending against such claim or claims, whether such liability shall be the
result of a judgment or as a result of any such settlement.
17. Title to Securities. The Units purchased, or on behalf of, the
respective Underwriters shall remain the property of such Underwriters until
sold, and title to any such Units shall not in any event pass to the
Representative by virtue of any of the provisions of this Agreement.
18. Blue Sky Matters. It is understood that you assume no
responsibility with respect to the right of any Underwriter or other
person to offer or to sell Units in any jurisdiction, notwithstanding any
information which you may furnish as to the jurisdictions under the securities
laws of which it is believed the Units may be sold.
19. Applicable Law. This Agreement will be governed by and
construed in accordance with the laws of the State of New York.
20. Capital Requirements. We confirm that the incurrence by us of
our obligation under this Agreement and under the Underwriting
Agreement will not place us in violation of the net capital requirements of
Rule 15c3-1 under the Exchange Act or of any applicable rules relating to
capital requirements of any securities exchange to which we are subject.
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21. Miscellaneous. Any notice from you to us shall be deemed to
have been duly give if mailed, telephoned or telegraphed to us at the
address set forth in the Underwriters Questionnaire furnished by us to you.
Any notice from us to you shall be deemed to have been duly given if mailed,
telephoned or telegraphed to you at 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000,
Attention: Xxxxxxx Xxxxxxxxxx.
We understand that you are a member in good standing of the
NASD. We hereby confirm that we are actually engaged in the investment
banking or securities business and are either (i) a member in good standing of
the NASD or (ii) a dealer with its principal place of business located outside
the United States, its territories and its possessions, and not registered as a
broker or dealer under the Exchange Act, who agrees not to make any sales
within the United States, its territories or its possessions, or to persons who
are nationals thereof or residents therein (except that we may participate in
sales to Selected Dealers and others under Section 5 of this Agreement). We
hereby agree to comply with the provisions of Rule 2740 of the NASD Conduct
Rules and if we are a foreign dealer and not a member of the NASD, we also
hereby agree to comply with the NASD's interpretation with respect to
free-riding and withholding and to comply, as though it were a member of the
NASD, with the provisions of Rule 2730 and 2750 of such Conduct Rules, and to
comply with Rule 2420 of such Conduct Rules as the Rule applies to a non-member
foreign dealer. In connection with sales and offers to sell Units made by us
outside the United States, its territories and possessions (i) we will either
furnish to each person to whom any such sale or offer is made a copy of the
then current Preliminary Prospectus or the Prospectus, as the case may be, or
inform such person that such Preliminary Prospectus or Prospectus will be
available upon request, and (ii) we will furnish to each person to whom any
such sale or offer is made such prospectus, advertisement or other offering
document containing information relating to the Units or the Company as may be
required under the law of the jurisdiction in which such sale or offer is made.
Any prospectus, advertisement or other offering document furnished by us to any
person in accordance with the preceding sentence and any such additional
offering material as we may furnish to any person (x) shall comply in all
respects with the law of the jurisdiction in which it is so furnished, (y)
shall be prepared and so furnished at our sole risk and expense and (z) shall
not contain information relating to the Units or the Company which is
inconsistent in any respect with the information contained in the then current
Preliminary Prospectus or in the Prospectus, as the case may be.
We understand that, in consideration of your services in
connection with the public offering of the Units, the Company has
agreed with you individually and not as Representative of the Underwriters (a)
to sell to you the Representative's Warrants ("Representative's Warrants")
referred to in Section 4.02 of the Underwriting Agreement for the sum of $.0005
per Representative's Warrant, (b) to pay to you a non-accountable expense
allowance referred to in Section 4.07 of the Underwriting Agreement and (c) to
enter into the Consulting Agreement described in Section 6.23 of the
Underwriting Agreement. In addition, you may, at your sole discretion, elect
to exercise the over-allotment opinion individually. We confirm to you that we
shall make no claim to the Representative's Warrants, the Company's securities
underlying the Representative's Warrants, the non-accountable expense allowance
or, to the over-allotment option, to the extent you elect to exercise such
option individually. You confirm to us that we shall have no obligations or
liabilities with respect to the purchase of the
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Representative's Warrants, the exercise thereof, the Company's
securities underlying the Representative's Warrants, the non-accountable
expense allowance or to the over-allotment option, to the extent you elect to
exercise such option individually.
Please confirm that the foregoing correctly states the
understanding between us by signing and returning to us a counterpart
thereof.
Very truly yours,
_________________________________
By:______________________________
(Attorney-in-fact for each of
the several Underwriters named
in Schedule A to the attached
Underwriting Agreement)
Confirmed as of the date first
Above written:
STUART, COLEMAN & CO., INC.
As Representative
By:______________________________
Managing Director-Syndicate
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