Exhibit 1.2
UTEK CORPORATION
1,000,000 Shares of Common Stock
AGREEMENT BETWEEN UNDERWRITERS
New York, New York
, 2000
To: Artesia Securities S.A./NV
WTC Tower 1
Boulevard de Roi Xxxxxx, 30-B18
X-0000 Xxxxxxxx, Xxxxxxx
Dear Sirs:
Utek Corporation (the "Company") proposes to enter into an
underwriting agreement, substantially in the form attached hereto as Exhibit A
(the "Underwriting Agreement"), with May Xxxxx Group, Inc. ("May Xxxxx") and
Artesia Securities S.A./NV ("Artesia", May Xxxxx and Artesia are collectively
referred to as the "Underwriters"), acting severally and not jointly, with
respect to the purchase from the Company of an aggregate of 1,000,000 shares
(the "Offered Shares"), $.001 par value (the "Common Shares"). The Underwriting
Agreement also provides for the grant to the Underwriters, individually, and not
as Underwriters of the Underwriters, of up to an additional 150,000 Shares (the
"Optional Shares"), at their option, for the sole purpose of covering
over-allotments in the sale of the Offered Shares. The Offered Shares are
described in the Registration Statement and Prospectus (as defined in the
Underwriting Agreement).
The Underwriters hereby confirm our agreement with respect to
the proposed purchase by the Underwriters severally of the Offered Shares and
the Optional Shares, and the proposed offering of the Offered Shares and the
Optional Shares, as follows:
1. Authority of the Underwriters. Each Underwriter hereby severally authorizes
the Underwriters on such Underwriter's behalf to (a) enter into an Underwriting
Agreement with the Company substantially in the form attached hereto as Exhibit
A; (b) determine, with each other's consent, the date specified by which the
Registration Statement is to become effective and fix and extend, to not later
than 10:00 a.m., New York City time, on the third full business day after the
Registration Statement shall have become effective (or any postponed date
pursuant to the Underwriting Agreement), the Closing Date (referred to in the
Underwriting Agreement) for the purchase of Offered Shares, unless such date and
(c) exercise the authority and discretion vested in the Underwriters by the
Underwriting Agreement.
With respect to the 1,000,000 Offered Shares, each of May
Xxxxx and Artesia agree to purchase 500,000 Offered Shares from the Company.
With respect to the Underwriters' Warrants, each of May Xxxxx and Artesia shall
purchase 50,000 warrants. In the event that the Underwriter's Over-Allotment
Option is exercised, each shall purchase an amount of Underwriters' Warrants
equal to 10% of the Over-Allotment Shares purchased by or for the account of
each Underwriter. With respect to the three percent (3%) non-accountable expense
allowance payable under the Underwriting Agreement ($180,000 with respect to an
offering of $6,000,0000 and $217,000 with respect to an offering of $6,900,000
if the Over-Allotment Option is exercised in full), May Xxxxx and Artesia shall
each receive one and one-half percent (1.5%) of the gross proceeds of the
offering. Each of May Xxxxx and Artesia shall bear their own expenses in
connection with the offering of the Offered Shares, including fifty percent of
the fees and expenses of XxXxxxxxxx & Xxxxx LLP, counsel to the underwriters.
The obligations of the Underwriters with respect to the purchase of the Offered
Shares and the Underwriters' Warrants are several and not joint.
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The Underwriters agree that the payments of the advisory fee
payable under the Financial Advisory Agreement shall be paid to May Xxxxx.
The initial public offering of the Offered Shares is to be
made on the date and at the public offering price fixed by the Underwriters. The
Underwriters may vary such price and the dealers' concession and reallowance
from time to time after the initial public offering.
The initial public advertisement will appear on the date of
the public offering of the Shares or the day following and will be over the
Underwriters's name and the names of such other Underwriters as the Underwriters
may determine. After such advertisement has appeared, but not before, any
Underwriter may advertise at its own risk and expense.
2. Compliance with NASD Conduct Rules Artesia represents that
it is a foreign dealer not eligible for membership in the National Association
of Securities Dealers Inc. ("NASD") and that it is not affiliated with any
member of the NASD. Artesia agrees to comply, as if it were a member of the
NASD, with the provisions of Rules 2730 and 2750 of the Conduct Rules of the
NASD and to comply with Rule 2420 as such Rules apply to a non-member
broker/dealer in a foreign country and to make no sales within the United States
or to persons who are citizens thereof or residents therein.
3. Sales to Institutions, Dealers, Etc. Each Underwriter may
sell the Offered Shares to securities dealers selected by the Underwriter making
such sale (the "Dealers"), who may include any of the several Underwriters, in
such proportion as the Underwriters may determine. Each Dealer will be a member
of the NASD or, if a foreign dealer not eligible for membership in the NASD,
will agree to conform to the provisions of the Conduct Rules of the NASD in
making sales outside the United States and to make no sales within the United
States or to persons who are citizens thereof or residents therein. Sales to
Dealers will be made less such Dealers' selling concession and other terms and
conditions as the Underwriters will determine.
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4. Sales by Underwriters. Each Underwriter agrees that for 25
days after the initial public offering of the Offered Shares or until
notification by May Xxxxx terminating this provision, whichever is earlier, all
sales of the Common Shares by it or on its behalf will be made in all respects
in compliance with and subject to the provisions of a selected dealer agreement,
if any, provided that May Xxxxx and Artesia may make sales for its account
pursuant to this Agreement
Artesia agrees to advise May Xxxxx, upon May Xxxxx' request,
of the number of Offered Shares purchased pursuant to the Underwriting Agreement
remaining unsold by it.
5. Payment and Delivery. At or before 9:00 a.m., New York City
time, on the Closing Date, Artesia agrees to deliver to May Xxxxx at its offices
at One World Trade Center, New York, New York, a certified or official bank
check payable to May Xxxxx Group Inc. in New York Clearing House funds, in an
amount equal to the full purchase price of the Offered Shares which Artesia is
to purchase on such date pursuant to the Underwriting Agreement. Artesia
authorizes May Xxxxx(a) to deliver Artesia's check or checks in payment for the
Offered Shares which Artesia is to purchase, and (b) to receive the certificates
for the Common Shares comprising the Offered Shares registered in the name of
Artesia or in any other name or form as Artesia deems desirable.
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6 Stabilization.
(a) To enable May Xxxxx to effect transactions for
the purpose of stabilizing the market in the Common Shares, Artesia authorizes
May Xxxxx for Artesia's account, prior to the termination of this Agreement, or
for such longer period as may be necessary to cover any short position incurred
for the accounts of the Underwriters under this authority, (i) to buy and sell
the Common Shares in the open market or otherwise on a when-issued or
when-delivered basis or otherwise, at such price or prices as May Xxxxx may
determine, (ii) in arranging for such sales of the Common Shares to Dealers and
others, to over-allot and (iii) in order to cover any such over-allotments, to
exercise in whole or in part the over-allotment option granted to the
Underwriters pursuant to the provisions of the Underwriting Agreement and to
purchase Common Shares pursuant to such exercise. It is understood that such
purchases and sales, over-allotments and exercises shall be made for the
respective accounts of the Underwriters as nearly as practicable equally between
May Xxxxx and Artesia. Artesia authorizes May Xxxxx to charge Artesia's account
with the cost of any Common Share so purchased for Artesia's account and agrees
to deliver to May Xxxxx on demand Common Shares to the extent thereof so sold
for Artesia's account. This provision is not an assurance that the price of the
Common Shares will be stabilized or that stabilization, if commenced, may not be
discontinued at any time. If pursuant to the provisions of this section and
prior to the termination of this Agreement (or, prior to such earlier date as
May Xxxxx may have determined) May Xxxxx purchases or contracts to purchase for
Artesia's account in the open market or otherwise any Common Shares which were
retained by or released to Artesia for direct sale, or on Common Shares which
may have been issued in exchange for such Common Shares, Artesia authorizes May
Xxxxx either to charge Artesia's account with an amount equal to the concession
to Dealers with respect thereto, which amount shall be credited against the cost
of such Common Shares, or to require Artesia to repurchase such Common Shares,
at a price equal to the total cost of such purchase, including broker's
commissions or dealer's xxxx-up, if any. In lieu of such action May Xxxxx may,
in its discretion, sell for Artesia's account the Common Shares so purchased and
debit or credit Artesia's account for the loss or profit resulting from such
sale.
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May Xxxxx will have authority to pay on
behalf of Artesia such commissions, taxes and other expenses as May Xxxxx may
deem proper in connection with such purchases and sales and to charge the
account of Artesia with commissions, taxes and appropriate expenses on purchases
and sales effected by May Xxxxx. This provision is not an assurance that the
price of the Offered Shares will be stabilized or that stabilization, if
commenced, will not be discontinued at any time.
(b) Artesia authorizes May Xxxxx to file with
the Commission any and all reports required by Rule 17a-2 under the Securities
Act of 1934, as amended (the "Exchange Act"), or any other applicable rule of
the commission, in connection with any purchases or sales made by May Xxxxx for
the account of Artesia pursuant to the foregoing authorization. May Xxxxx will
advise Artesia promptly of the dates on which May Xxxxx commences and terminates
any such transactions. Each Underwriter has, and assumes for itself, the
responsibility for making the reports required by such rules with respect to its
own transactions which are subject thereto. Each Underwriter shall retain the
records required by such rules with respect to its own transactions which are
subject thereto.
(c) Until the termination of this Agreement or
prior notification by May Xxxxx, May Xxxxx will have the sole right to effect
stabilizing transactions in the Shares. Each Underwriter agrees that until such
time it will not make any purchases or sales of the Common Shares of the Company
except (i) pursuant to the Underwriting Agreement or this Agreement, (ii)
pursuant to authorization received from the Underwriters, or (iii) in the
ordinary course of business as broker or agent for a customer pursuant to an
unsolicited order.
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7. Indemnification. Each Underwriter, severally, will
indemnify and hold harmless the other Underwriter, any person who may be deemed
to control any other Underwriter within the meaning of Section 15 of the
Securities Act of 1933, as amended (the "Securities Act"), and each officer,
director, partner, employee and agent of any other Underwriter, to the extent
and upon the terms set forth in the Underwriting Agreement. Such indemnity will
survive the termination of this Agreement and will remain in full force and
effect regardless of any investigation made by, or on behalf of, such other
Underwriter or such persons.
8. Termination of Agreement. Except as to accrued obligations
and except as otherwise provided herein, this Agreement will terminate (a) at
the close of business on the 20th day following the effective date of the
Registration Statement, or (b) at such other date, but in no event more than 40
days following such effective date, as May Xxxxx may fix by notice to Artesia,
or (c) if the Underwriting Agreement will be terminated, in accordance with its
terms. Such termination, however, will not relieve any Underwriter from its
proportionate share of any charges, liabilities or expenses incurred prior
thereto.
9. Settlement of Accounts. Accounts will be closed and settled
under this Agreement as soon as practicable after termination. At such time any
Common Shares held by May Xxxxx for the account of Artesia shall be distributed
by May Xxxxx to Artesia, and the net credit or debit balance of Artesia will be
paid to it or collected from Artesia by May Xxxxx, but the May Xxxxx may
establish reasonable reserves against any claims and expenses not then
ascertained. Notwithstanding any distribution or settlement on the termination
of accounts, each Underwriter will remain liable for its proper proportion of
any tax or other liability which may be asserted against any one or more of the
Underwriters in respect of this Agreement or the Underwriting Agreement based
upon the claim that the Underwriters constitute a partnership, an association,
an unincorporated business or other separate entity, and each Underwriter agrees
to pay its proper proportion of the expenses of resisting any such claim. The
provisions of this Section 9 will survive the termination of this Agreement.
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9. Compliance with Exchange Act, Etc. Each Underwriter will
comply with any applicable provisions of the Exchange Act or regulations of the
Securities and Exchange Commission.
10. Registration Statement; Prospectus. Each Underwriter
confirms (a) that it has examined each Preliminary Prospectus, the Registration
Statement and the form of Prospectus (and any amendments or supplements thereto)
referred to in the Underwriting Agreement; (b) that the information therein is
correct and not misleading insofar as such information relates to such
Underwriter; and (c)that it is willing to accept the responsibilities under the
Securities Act of an underwriter named in the Registration Statement and is
willing to proceed with the underwriting in the manner contemplated thereby.
Artesia authorizes May Xxxxx, on behalf of Artesia, to consent to the filing of
any further amendments or supplements to any Preliminary Prospectus, the
Registration Statement or the Prospectus.
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10. Status of Underwriters and Underwriters. Nothing contained
herein shall constitute the Underwriters, or any of them, partners or render any
of them liable to make payments otherwise than as herein provided, or impair the
several nature of their obligations under this Agreement and the Underwriting
Agreement.
11. Default by an Underwriter. If any Underwriter shall fail
or refuse to purchase any of the Offered Shares that it has severally agreed to
purchase and arrangements satisfactory to the non-defaulting Underwriter and the
Company for the purchase of such amount of Offered Shares are not made within 48
hours after such default, this Agreement will terminate without liability on the
part of the non-defaulting Underwriters for the purchase or sale of any of the
Offered Shares under the Underwriting Agreement. In any such case, either the
non-defaulting Underwriter or the Company shall have the right to postpone the
Closing Date but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement and the Prospectus or in
any other documents or arrangements may be effected. Any action taken under this
section shall not relieve the defaulting Underwriter from liability in respect
of its default under this Agreement.
12. Liability of Underwriters. Except as expressly stated
herein, or as may arise under the Securities Act, the Underwriters will not be
under any liability for, or in respect of: the validity or value of the Common
Shares; the form of, or the statements contained in, the Registration Statement,
any Preliminary Prospectus, the Prospectus (or any amendments or supplements
thereto), or any supplemental sales data or other letters or instruments
executed by, or obtained from, the Company; the form or validity of the
Underwriting Agreement or this Agreement; the eligibility of the Common Shares
for sale under the laws of any state or jurisdiction; the delivery of the
Shares; the performance by the Company or others of any agreement on its or
their part; or any matter in connection with any of the foregoing, except the
Underwriters's own lack of good faith.
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13. Notices. Any notice to any Underwriter will be deemed
to have been duly given if mailed, telecopied or delivered to such Underwriter
at the address set forth in the Underwriter's Agreement.
14. Construction of Agreement. This Agreement will be governed
by, and construed and enforced in accordance with, the laws of the State of New
York applicable to contracts made and to be wholly performed in such State. Any
actions brought with respect to any disputes arising under this Agreement shall
be brought in the Southern District of New York or the state courts of the State
of New York. The parties hereto consent to the jurisdiction of the Southern
District of New York or the courts of the State of New York with respect to all
disputes arising out of this Agreement.
15. Headings. The headings in this Agreement are for purposes
of reference only and will not limit or otherwise affect any of the terms or
provisions hereof.
16. Counterparts. This Agreement may be signed in any number
of counterparts which, taken together, will constitute one and the same
instrument.
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Very truly yours,
MAY XXXXX GROUP, INC.
By:/s/
------------------------------
Confirmed as of the date
first above written:
ARTESIA SECURITIES, S.A./NV
_____________________________________
By:__________________________________
Authorized Signature
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