EXHIBIT 1.1
SYNETICS SOLUTIONS INC.
6,900,000 Shares*
Common Stock
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Underwriting Agreement
July __, 2004
Xxxxx, Xxxxxxxx & Xxxx, Inc.
Xxxxx Fargo Securities, LLC
Nomura Securities International, Inc.
As representatives of the several Underwriters
named in Schedule I hereto
x/x Xxxxx, Xxxxxxxx & Xxxx, Xxx.
00 Xxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Dear Sirs:
Synetics Solutions Inc., an Oregon corporation (the "COMPANY"), proposes,
subject to the terms and conditions stated herein, to issue and sell to the
several underwriters named in Schedule I hereto (collectively, the
"UNDERWRITERS") an aggregate of 6,000,000 shares and, at the election of the
Underwriters, up to 900,000 additional shares of common stock, no par value, of
the Company (the "COMMON STOCK"). The aggregate of 6,000,000 shares to be sold
by the Company is herein called the "FIRM SHARES" and the aggregate of up to
900,000 additional shares to be sold by the Company is herein called the
"OPTIONAL SHARES." The Firm Shares and the Optional Shares that the Underwriters
elect to purchase pursuant to Section 2 hereof are herein collectively called
the "SHARES."
1. Representations and Warranties and Agreements of the Company. The
Company represents and warrants to, and agrees with, each of the Underwriters
that:
(a) A registration statement on Form S-1 (File No. 333-115065) (the
"INITIAL REGISTRATION STATEMENT") in respect of the Shares has been filed with
the Securities and Exchange Commission (the "COMMISSION"); the Initial
Registration Statement including any pre-effective amendments thereto and any
post-effective amendments thereto, each in the form heretofore delivered to you
and, excluding exhibits thereto, delivered to you for each of the other
Underwriters, have been declared effective by the Commission in such form; other
than a registration statement, if any, increasing the size of the offering (a
"RULE 462(B) REGISTRATION STATEMENT"), filed pursuant to Rule 462(b) under the
Securities Act of 1933, as amended (the "ACT"), which became effective upon
filing, no other document with respect to the Initial Registration Statement has
heretofore been filed with the Commission; and no stop order suspending the
effectiveness of the Initial Registration Statement, any pre- or post-effective
amendment thereto or the Rule 462(b) Registration Statement, if any, has been
issued and no
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* Includes 900,000 shares subject to an option to purchase additional shares
to cover over-allotments.
proceeding for that purpose has been initiated or, to the Company's knowledge,
threatened by the Commission (any preliminary prospectus included in the Initial
Registration Statement or filed with the Commission pursuant to Rule 424(a) of
the rules and regulations of the Commission under the Act is hereinafter called
a "PRELIMINARY PROSPECTUS"); the various parts of the Initial Registration
Statement and the Rule 462(b) Registration Statement, if any, and including the
information contained in the form of final prospectus filed with the Commission
pursuant to Rule 424(b) under the Act in accordance with Section 5(a) hereof and
deemed by virtue of Rule 430A under the Act to be part of the Initial
Registration Statement at the time it was declared effective or the Rule 462(b)
Registration Statement, if any, at the time it became effective, each as amended
at the time such part of such Initial Registration Statement became effective,
are hereinafter collectively called the "REGISTRATION STATEMENT"; such final
prospectus, in the form first filed pursuant to Rule 424(b) under the Act, is
hereinafter called the "PROSPECTUS";
(b) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary Prospectus,
at the time of filing thereof, conformed in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder, and did 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, in the light of the circumstances under which they were
made, not misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter through you expressly for use therein;
(c) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of the Act
and the rules and regulations of the Commission thereunder and do not and will
not, as of the applicable effective date as to the Registration Statement and
any amendment thereto and as of the applicable filing date and the applicable
Time of Delivery (as hereinafter defined) as to the Prospectus and any amendment
or supplement thereto contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or, in the case of the
Registration Statement or any amendment thereto, necessary to make the
statements therein not misleading and, in the case of the Preliminary
Prospectus, the Prospectus or any supplement thereto, necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter through you expressly for use therein;
(d) There are no contracts or other documents required to be
described in the Registration Statement or to be filed as exhibits to the
Registration Statement by the Act or by the rules and regulations thereunder
which have not been described in or filed as exhibits to the Registration
Statement, as required; the contracts so described in the Prospectus to which
the Company is a party have been duly authorized, executed and delivered by the
Company, constitute valid and binding agreements of the Company and are
enforceable against and by the Company in accordance with their respective
terms, and are in full force and effect on the date hereof; and neither the
Company, nor, to the best of the Company's knowledge, any other party is in
breach of or default under any of such contracts;
-2- UNDERWRITING AGREEMENT
(e) Since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus, the Company has not
sustained any material loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or decree, other than
as set forth in the Prospectus; and, since the respective dates as of which
information is given in the Registration Statement and the Prospectus, there has
not been any change in the capital stock (other than issuances of Common Stock
pursuant to Company stock option and stock purchase plans described in the
Registration Statement and Prospectus) or long-term debt of the Company or any
material adverse change, or any development involving a prospective material
adverse change, in or affecting the business, assets, management, financial
condition, stockholders' equity or results of operations of the Company (a
"MATERIAL ADVERSE CHANGE"), other than as set forth or contemplated in the
Prospectus;
(f) The Company owns no real property. The Company has good title to
all other properties and assets described in the Prospectus as owned by it, in
each case free and clear of all liens, charges, encumbrances or restrictions,
except such as are described in the Prospectus or are not material to the
business of the Company; any real property and buildings held under lease by the
Company are held by it under valid, subsisting and enforceable leases with such
exceptions as are not material and do not interfere with the use made and
proposed to be made of such property and buildings by the Company; the Company
owns or leases all such properties as are necessary to its operations as
described in the Prospectus, except where the failure to so own or lease would
not result in a Material Adverse Change;
(g) The Company has been duly incorporated and is validly existing
as a corporation under the laws of its jurisdiction of organization, with full
power and authority (corporate and otherwise) to own its properties and conduct
its business as described in the Prospectus, and has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases properties
or conducts any business so as to require such qualification, except where such
failure to so qualify would not result in a Material Adverse Change;
(h) The Company has an authorized capitalization as set forth in the
Prospectus, and all the issued shares of capital stock of the Company have been
duly authorized and validly issued, are fully paid and non-assessable, have been
issued free of preemptive rights and conform in all material respects to the
description of the Common Stock contained in the Prospectus; the Company has no
subsidiaries; except as disclosed in or contemplated by the Prospectus and the
financial statements of the Company, and the related notes thereto, included in
the Prospectus, the Company has outstanding no options to purchase, or any
preemptive rights or other rights to subscribe for or to purchase any securities
or obligations convertible into, or any contracts or commitments to issue or
sell, shares of its capital stock or any such options, rights, convertible
securities or obligations; and the description of the Company's stock option and
stock purchase plans and the options or other rights granted and exercised
thereunder set forth in the Prospectus accurately and fairly presents in all
material respects the information required to be shown with respect to such
plans, options and rights;
(i) The unissued Shares to be issued and sold by the Company to the
Underwriters hereunder have been duly authorized and, when delivered against
payment therefor
-3- UNDERWRITING AGREEMENT
as provided herein, will be validly issued and fully paid and non-assessable and
will conform to the description of the Common Stock contained in the Prospectus;
no preemptive rights or other rights to subscribe for or purchase exist with
respect to the issuance and sale of the Shares by the Company pursuant to this
Agreement; no shareholder of the Company has any right, which has not been
waived, to require the Company to register the sale of any shares of capital
stock owned by such shareholder under the Act in the public offering
contemplated by this Agreement; and no further approval or authority of the
shareholders or the Board of Directors of the Company will be required for the
issuance and sale of the Shares to be sold by the Company as contemplated
herein;
(j) The Company has full corporate power and authority to enter into
this Agreement; and this Agreement has been duly authorized, executed and
delivered by the Company, constitutes a valid and binding obligation of the
Company and is enforceable against the Company in accordance with its terms,
except as the enforcement thereof may be limited by bankruptcy and other laws
relating to the rights and remedies of creditors generally or by the
availability of general equitable remedies;
(k) The issue and sale of the Shares by the Company and the
compliance by the Company with all of the provisions of this Agreement and the
consummation of the transactions herein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other material agreement or material instrument to which the
Company is a party or by which the Company is bound or to which any of the
property or assets of the Company is subject, nor will such action result in any
violation of the provisions of the Articles of Incorporation or Bylaws of the
Company or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any of its
properties; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the issue and sale of the Shares or the consummation by the Company
of the transactions contemplated by this Agreement, except the registration
under the Act of the Shares and such consents, approvals, authorizations,
registrations or qualifications as may be required under state securities or
Blue Sky laws or the bylaws and rules of the National Association of Securities
Dealers, Inc. ("NASD") in connection with the purchase and distribution of the
Shares by the Underwriters;
(l) The Company is not in violation of its Articles of Incorporation
or Bylaws. The Company is not in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or instrument
to which it is a party or by which it or any of its properties may be bound,
except for any default that would not, individually or in the aggregate, result
in a Material Adverse Change;
(m) The statements set forth in the Prospectus under the caption
"Description of Capital Stock," insofar as they purport to constitute a summary
of the terms of the capital stock, under the caption "Description of Capital
Stock" and under the caption "Plan of Distribution," insofar as they purport to
describe the provisions of the laws and documents referred to therein, are
accurate, complete and fair;
-4- UNDERWRITING AGREEMENT
(n) There are no legal or governmental actions, suits or proceedings
pending or, to the best of the Company's knowledge, threatened to which the
Company is or may be a party or of which property owned or leased by the Company
is or may be the subject, or related to environmental or discrimination matters,
which actions, suits or proceedings, could, if determined adversely to the
Company, individually or in the aggregate, prevent or adversely affect the
transactions contemplated by this Agreement or result in a Material Adverse
Change; no labor disturbance by the employees of the Company exists or, to the
knowledge of the Company, is imminent that would reasonably be expected to
result in a Material Adverse Change; and the Company is neither a party nor
subject to the provisions of any material injunction, judgment, decree or order
of any court, regulatory body, administrative agency or other governmental body,
that could reasonably be expected to result in a Material Adverse Change;
(o) The Company possesses all licenses, certificates, authorizations
or permits issued by the appropriate governmental or regulatory agencies or
authorities that are necessary to enable it to own, lease and operate its
properties and to carry on its business as described in the Prospectus, except
where the failure to possess such licenses, certificates, authorization or
permits would not reasonably be expected to result in a Material Adverse Change
and the Company has not received any notice of proceedings relating to the
revocation or modification of any such license, certificate, authority or permit
which, singly or in the aggregate, would reasonably be expected to result in a
Material Adverse Change;
(p) The Company (i) is in compliance in all material respects with
any and all applicable foreign, federal, state and local laws, regulations,
rules, decisions and orders, including, without limitation, those relating to
occupational safety and health, the environment or hazardous or toxic substances
or wastes, pollutants or contaminants, including, without limitation, those
relating to the storage, handling or transportation of hazardous or toxic
materials (collectively, "ENVIRONMENTAL LAWS") and (ii) is in compliance with
all terms and conditions of any permit, license or approval relating to
Environmental Laws, 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 approvals
would not, singly or in the aggregate, reasonably be expected to result in a
Material Adverse Change. The Company, in its reasonable judgment, has concluded
that any costs or liabilities associated with Environmental Laws (including,
without limitation, any capital or operating expenditures required for clean-up,
closure of properties or compliance with Environmental Laws or any permit,
license or approval, any related constraints on operating activities and any
potential liabilities to third parties) would not, singly or in the aggregate,
reasonably be expected to result in a Material Adverse Change;
(q) KPMG LLP, who have audited certain financial statements of the
Company, are independent public accountants as required by the Act and the rules
and regulations of the Commission thereunder;
(r) The financial statements and schedules of the Company, and the
related notes thereto, included or incorporated by reference in the Registration
Statement and the Prospectus present fairly in all material respects the
financial condition of the Company as of the respective dates of such financial
statements and schedules, and the results of operations and
-5- UNDERWRITING AGREEMENT
cash flows of the Company for the respective periods covered thereby; such
statements, schedules and related notes have been prepared in accordance with
generally accepted accounting principles applied on a consistent basis as
certified by the independent public accountants named in paragraph (q) above; no
other financial statements or schedules are required to be included in the
Registration Statement; and the selected financial data set forth in the
Prospectus under the captions "Capitalization" and "Selected Financial Data"
fairly present in all material respects the information set forth therein on the
basis stated in the Registration Statement;
(s) The Company owns, possesses or can acquire on reasonable terms,
adequate trademarks, trade names and other rights to inventions, patents,
copyrights, confidential information, know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential information,
systems or procedures), and other intellectual property (collectively, the
"INTELLECTUAL PROPERTY") necessary to conduct its business as described in the
Prospectus. The Company has not received any notice of infringement of or
conflict with asserted rights of another with respect to any Intellectual
Property that, if determined adversely to the Company, would individually or in
the aggregate result in a Material Adverse Change, and the Company does not know
of any facts which would form a reasonable basis for such a claim. The Company
has no knowledge of any infringement or misappropriation by any employees or
third parties of any of the Company's Intellectual Property, nor is there any
pending or, to the best knowledge of the Company, threatened action, suit,
proceeding or claim by others challenging the Company's rights or other
interests in or to any Intellectual Property that, if determined adversely to
the Company, would individually or in the aggregate result in a Material Adverse
Change, and the Company does not know of any facts which would form a reasonable
basis for such a claim. The Prospectus fairly and accurately describes the
Company's rights with respect to Intellectual Property.
(t) The Company has filed all necessary federal, state and foreign
income and franchise tax returns, each of which has been true and correct in all
material respects, and has paid all taxes shown as due thereon; and the Company
has no knowledge of any material tax deficiency which has been or might be
asserted or threatened against the Company;
(u) The Company is not an "investment company" or an "affiliated
person" of, or "promoter" or "principal underwriter" for, an "investment
company", as such terms are defined in the Investment Company Act of 1940, as
amended (the "INVESTMENT COMPANY ACT");
(v) The Company maintains insurance of the types and in the amounts
which it reasonably believes adequate for its business, including, but not
limited to, insurance covering real and personal property owned or leased by the
Company against theft, damage, destruction, acts of vandalism and all other
risks customarily insured against, all of which insurance is in full force and
effect;
(w) The Company has not at any time (i) made any unlawful
contribution to any candidate for foreign office, or failed to disclose fully
any contribution in violation of law, or (ii) made any payment to any foreign,
federal or state governmental officer or official, or other person charged with
similar public or quasi-public duties, other than payments required or
-6- UNDERWRITING AGREEMENT
permitted by the laws of the United States, any foreign government or any
respective jurisdiction thereof;
(x) The Company has not taken and will not take, directly or
indirectly through any of its directors, officers or controlling persons, any
action which is designed to or which has constituted or which might reasonably
be expected to cause or result in stabilization or manipulation of the price of
any security of the Company to facilitate the sale or resale of the Shares;
(y) The Common Stock of the Company has been registered pursuant to
Section 12(g) of the Exchange Act and the Company is not required to take any
further action for the inclusion of the Shares on the Nasdaq National Market
System, subject to notice of issuance;
(z) There are no business relationships or related-party
transactions involving the Company or any other person required to be described
in the Prospectus which have not been described as required;
(aa) The Company maintains a system of accounting controls
sufficient to provide reasonable assurances that (i) transactions are executed
in accordance with management's general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles as
applied in the United States and to maintain accountability for assets; (iii)
access to assets is permitted only in accordance with management's general or
specific authorization; 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;
(bb) The Company and any "employee benefit plan" (as defined under
the Employee Retirement Income Security Act of 1974, as amended, and the
regulations and published interpretations thereunder (collectively, "ERISA"))
established or maintained by the Company or its ERISA affiliates (as defined
below) are in compliance in all material respects with ERISA. "ERISA AFFILIATE"
means, with respect to the Company, any member of any group of organizations
described in Sections 414(b),(c),(m) or (o) of the Internal Revenue Code of
1986, as amended, and the regulations and published interpretations thereunder
(the "CODE") of which the Company is a member. No "reportable event" (as defined
under ERISA) has occurred or is reasonably expected to occur with respect to any
"employee benefit plan" established or maintained by the Company or any of its
ERISA Affiliates. No "employee benefit plan" established or maintained by the
Company or any of its ERISA Affiliates, if such "employee benefit plan" were
terminated, would have any "amount of unfunded benefit liabilities" (as defined
under ERISA). Neither the Company nor any of its ERISA Affiliates has incurred
or reasonably expects to incur any liability under (i) Title IV of ERISA with
respect to termination of, or withdrawal from, any "employee benefit plan" or
(ii) Sections 412, 4971, 4975 or 4980B of the Code. Each "employee benefit plan"
established or maintained by the Company or any of its ERISA Affiliates that is
intended to be qualified under Section 401(a) of the Code is so qualified and
nothing has occurred, whether by action or failure to act, which would cause the
loss of such qualification, except where such loss would not result in a
Material Adverse Change;
-7- UNDERWRITING AGREEMENT
(cc) Except as described in the Prospectus, there are no material
off-balance sheet transactions, arrangements, obligations (including contingent
obligations), or any other relationships with unconsolidated entities or other
persons, that have or are reasonably likely to have a material effect on the
Company's financial condition, revenues or expenses, results of operations,
liquidity, capital expenditures or capital resources;
(dd) The statistical and market-related data included in the
Prospectus and the Registration Statement are based on or derived from sources
that the Company believes to be reliable and accurate and the Company has
obtained the written consent to the use of such data to the extent required;
(ee) Upon the effectiveness of the Registration Statement, the
Company will be in compliance with all applicable provisions of the
Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations promulgated thereunder
or in connection therewith by the Commission or NASD;
(ff) The Company's Board of Directors has validly appointed an Audit
Committee whose composition and charter satisfies the applicable requirements of
Rule 4350(d) of the Rules of the NASD and Rule 10A-3 under the Exchange Act and
the rules and regulations thereunder and the Nasdaq listing requirements;
(gg) The Company has established and maintains disclosure controls
and procedures (as such term is defined in Rule 13a-15(e) under the Exchange
Act); such disclosure controls and procedures are designed to ensure that
material information relating to the Company is made known to the Company's
Chief Executive Officer and its Chief Financial Officer by others within the
Company; and such disclosure controls and procedures are effective to perform
the functions for which they were established; the Company is not aware of (i)
any significant deficiency in the design or operation of internal controls which
could adversely affect the Company's ability to record, process, summarize and
report financial data or any material weaknesses in internal controls; or (ii)
any fraud, whether or not material, that involves management or other employees
who have a significant role in the Company's internal controls; and
(hh) There are no contracts, agreements or understandings between
the Company and any person that would give rise to a valid claim against the
Company or any Underwriter for a brokerage commission, finder's fee or other
like payment in connection with this offering.
2. Shares Subject to Sale.
On the basis of the representations, warranties and agreements of the
Company contained herein, and subject to the terms and conditions of this
Agreement:
(a) The Company agrees to issue and sell the Firm Shares to the
several Underwriters and (ii) each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at a purchase price per share of
$[_____], the respective number of Firm Shares (to be adjusted by Xxxxx,
Xxxxxxxx & Xxxx, Inc. to eliminate fractional shares) determined in
-8- UNDERWRITING AGREEMENT
each case by multiplying the aggregate number of Shares to be sold by the
Company by a fraction, the numerator of which is the aggregate number of Firm
Shares to be purchased by such Underwriter as set forth opposite the name of
such Underwriter in Schedule I hereto and the denominator of which is the
aggregate number of Firm Shares to be purchased by all of the Underwriters from
the Company hereunder; and
(b) In the event and to the extent that the Underwriters shall
exercise the election to purchase Optional Shares as provided below, the Company
agrees to sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the Second Time of
Delivery, at the purchase price per share set forth in clause (a) of this
Section 2, that number of Optional Shares determined by multiplying the number
of Optional Shares as to which such election shall have been exercised (to be
adjusted by Xxxxx, Xxxxxxxx & Xxxx, Inc. so as to eliminate fractional shares)
by a fraction, the numerator of which is the maximum number of Optional Shares
which such Underwriter is entitled to purchase as set forth opposite the name of
such Underwriter in Schedule I hereto and the denominator of which is the
maximum number of Optional Shares that all of the Underwriters are entitled to
purchase hereunder.
The Company hereby grants to the Underwriters the right to
purchase at their election up to 900,000 Optional Shares, at the purchase price
per share set forth in clause (a) of this Section 2, for the sole purpose of
covering sales of shares in excess of the number of Firm Shares. Any such
election to purchase Optional Shares may be exercised only by written notice
from Xxxxx, Xxxxxxxx & Xxxx, Inc. to the Company, given within a period of 30
calendar days after the date of this Agreement and setting forth the aggregate
number of Optional Shares to be purchased and the date on which such Optional
Shares are to be delivered, as determined by Xxxxx, Xxxxxxxx & Xxxx, Inc. but in
no event earlier than the First Time of Delivery or, unless Xxxxx, Xxxxxxxx &
Xxxx, Inc. and the Company otherwise agree in writing, earlier than two or later
than ten business days after the date of such notice.
3. Offering. Upon the authorization by you of the release of the Firm
Shares, the several Underwriters propose to offer the Firm Shares for sale upon
the terms and conditions set forth in the Prospectus.
4. Closing. Certificates in definitive form for the Shares to be purchased
by each Underwriter hereunder, and in such denominations and registered in such
names as Xxxxx, Xxxxxxxx & Xxxx, Inc. may request upon at least forty-eight
hours' prior notice to the Company, shall be delivered by or on behalf of the
Company to you for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price therefor by wire transfer of
same day funds, all at the office of Xxxxxxx Coie LLP, 0000 X.X. Xxxxx Xxxxxx,
Xxxxx Xxxxx, Xxxxxxxx, Xxxxxx 00000, or such other location as may be mutually
acceptable. The time and date of such delivery and payment shall be, with
respect to the Firm Shares, 9:30 a.m., Boston time, on [__________], 2004 or
such other time and date as you and the Company may agree upon in writing, and,
with respect to the Optional Shares, 9:30 a.m., Boston time, on the date
specified by you in the written notice given by you of the Underwriters'
election to purchase such Optional Shares, or at such other time and date as you
and the Company may agree upon in writing. Such time and date for delivery of
the Firm Shares is herein called the "FIRST TIME OF DELIVERY," such time and
date for delivery of the Optional Shares, if not the First Time of
-9- UNDERWRITING AGREEMENT
Delivery, is herein called the "SECOND TIME OF DELIVERY," and each such time and
date for delivery is herein called a "TIME OF DELIVERY." Such certificates will
be made available for checking and packaging at least twenty-four hours prior to
each Time of Delivery at such location as you may specify. If the Underwriters
so elect, delivery of the Shares may be made by credit through full fast
transfer to the accounts at the Depository Trust Company designated by Xxxxx,
Xxxxxxxx & Xxxx, Inc.
5. Covenants of the Company. The Company agrees with each of the
Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file
such Prospectus pursuant to Rule 424(b) under the Act not later than
Commission's close of business on the second business day following the
execution and delivery of this Agreement, or, if applicable, such earlier time
as may be required by Rule 430A(a)(3) under the Act, to make no further
amendment or any supplement to the Registration Statement or Prospectus which
shall be reasonably disapproved by you promptly giving reasonable notice
thereof; to advise you, promptly after it receives notice thereof, of the time
when the Registration Statement, or any amendment thereto, has been filed or
becomes effective or any supplement to the Prospectus or any amended Prospectus
has been filed and to furnish you copies thereof; to advise you, promptly after
it receives notice thereof, of the issuance by the Commission of any stop order
or of any order preventing or suspending the use of any Preliminary Prospectus
or Prospectus, of the suspension of the qualification of the Shares for offering
or sale in any jurisdiction, of the initiation or threatening of any proceeding
for any such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or Prospectus or for additional
information; and, in the event of the issuance of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or Prospectus or
suspending any such qualification, to use promptly its best efforts to obtain
the withdrawal of the order;
(b) Promptly, from time to time, to take such action as you may
reasonably request to qualify the Shares for offering and sale under the
securities laws of such jurisdictions as you may request and to comply with such
laws so as to permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the distribution of
the Shares, provided that in connection therewith the Company shall not be
required to qualify as a foreign corporation or to file a general consent to
service of process in any jurisdiction;
(c) To furnish the Underwriters with copies of the Prospectus in
such quantities and at such times as you may from time to time reasonably
request (such copies of the Prospectus being delivered to you no later than 3:00
p.m., Boston time, on the later of the first business day following the date of
the execution of this Agreement and the effectiveness of the Initial
Registration Statement), and, if the delivery of a prospectus is required at any
time prior to the expiration of nine months after the time of issuance of the
Prospectus in connection with the offering or sale of the Shares and if at such
time any events shall have occurred as a result of which the Prospectus as then
amended or supplemented would include an untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or, if for any other reason it shall be
necessary during such same period to amend or supplement the Prospectus or file
a new registration statement and deliver a prospectus contained therein, in
order to comply with the Act with respect to the sale of the Shares, to notify
you and
-10- UNDERWRITING AGREEMENT
upon your request to prepare and furnish without charge to each Underwriter and
to any dealer in securities as many copies as you may from time to time
reasonably request of an amended Prospectus or a supplement to the Prospectus or
a new prospectus which will correct such statement or omission, or effect such
compliance, and in case any Underwriter is required by law to deliver a
prospectus in connection with sales of any of the Shares at any time nine months
or more after the time of issue of the Prospectus, upon your request but at the
expense of such Underwriter, to prepare and deliver to such Underwriter as many
copies as you may request of a new prospectus or an amended or supplemented
Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its security holders as soon as
practicable, but in any event not later than the forty-fifth (45th) day
following the end of the full fiscal quarter first occurring after the first
anniversary of the effective date of the Registration Statement (as defined in
Rule 158(c)), an earning statement of the Company (which need not be audited)
complying with Section 11(a) of the Act and the rules and regulations of the
Commission thereunder (including Rule 158);
(e) During the period beginning from the date hereof and continuing
to and including the date 180 days after the date of the Prospectus, not to
offer, sell, contract to sell, pledge or otherwise dispose of or agree to do any
of the foregoing, directly or indirectly, or announce an intention to do any of
the foregoing, any Common Stock or securities of the Company which are
substantially similar to the Shares or which are convertible into or exercisable
for such Common Stock or securities, without your prior written consent other
than (i) the sale of the Shares to be sold by the Company hereunder and (ii) the
Company's issuance of shares subject to an option outstanding on the date hereof
as disclosed in the Prospectus and the award of options under its stock plans in
amounts not in excess of the amount shown as available for grant in the
Prospectus;
(f) Not to grant options to purchase shares of Common Stock which
would become exercisable during a period beginning from the date hereof and
continuing to and including the date 180 days after the date of the Prospectus
and not to accelerate the vesting of any option issued under any stock option
plan such that any such option may be exercised within 180 days from the date of
the Prospectus;
(g) To furnish to its shareholders as soon as practicable after the
end of each fiscal year an annual report (including a balance sheet and
statements of income, stockholders' equity and cash flow of the Company
certified by independent public accountants) and to make available (within the
meaning of Rule 158(b) under the Act) as soon as practicable after the end of
each of the first three quarters of each fiscal year (beginning with the fiscal
quarter ending after the effective date of the Registration Statement),
consolidated summary financial information of the Company for such quarter in
reasonable detail;
(h) During a period of five years from the effective date of the
Registration Statement, to furnish to you upon your request copies of all
reports or other communications (financial or other) furnished to shareholders
generally, and deliver to you as soon as they are available, copies of any
reports and financial statements furnished to or filed with the Commission, the
Nasdaq National Market or any national securities exchange on which any class
-11- UNDERWRITING AGREEMENT
of securities of the Company is listed (such financial statements to be on a
combined or consolidated basis to the extent the accounts of the Company are
combined or consolidated in reports furnished to its shareholders generally or
to the Commission) in each case if such reports, other communications or
financial statements are not immediately available electronically via XXXXX;
(i) To use the net proceeds acquired by it from the sale of the
Shares in the manner specified in the Prospectus under the caption "Use of
Proceeds" and in a manner such that the Company will not become an "investment
company" as that term is defined in the Investment Company Act;
(j) To use its best efforts to list for quotation the Shares on the
Nasdaq National Market System;
(k) To file promptly all reports and any definitive proxy or
information statement required to be filed by the Company with the Commission in
order to comply with the Exchange Act subsequent to the date of the Prospectus
and for so long as the delivery of a prospectus is required in connection with
the offering or sale of the Shares; and
(l) If the Company elects to rely upon rule 462(b), the Company
shall file a Rule 462(b) Registration Statement with the commission in
compliance with Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the date of
this Agreement, and the Company shall at the time of filing either pay to the
Commission the filing fee for the Rule 462(b) Registration Statement or give
irrevocable instructions for the payment of such fee pursuant to Rule 111(b)
under the Act.
6. Expenses. The Company covenants and agrees with the several
Underwriters that 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, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) all expenses and filing fees in
connection with the qualification of the Shares for offering and sale under
state securities laws and securing any required review by the NASD of the terms
of the sale of the Shares, including the fees and disbursements of counsel for
the Underwriters in connection with such qualification and review and in
connection with the Blue Sky survey; (iii) the cost of preparing stock
certificates; (iv) the cost and charges of any transfer agent or registrar; (v)
listing fees; (vi) the costs and expenses of the Company relating to investor
presentations on any "road show" undertaken in connection with the marketing of
the Shares, including without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any
consultants engaged in connection with the road show presentations, travel and
lodging expenses of the representatives and officers of the Company and any such
consultants, and the cost of aircraft and other transportation chartered in
connection with the road show and (vii) all other costs and expenses incident to
the performance of the Company's obligations hereunder which are not otherwise
specifically provided for in this Section 6. It is understood, however, that
except as provided in this Section 6, and Sections 8 and 11 hereof, the
Underwriters will pay all of their own costs and expenses.
-12- UNDERWRITING AGREEMENT
7. Conditions of Underwriters' Obligations. The obligations of the
Underwriters hereunder, as to the Shares to be delivered at each Time of
Delivery, shall be subject, in their discretion, to the condition that all
representations and warranties and other statements of the Company herein are,
at and as of such Time of Delivery, true and correct, the condition that the
Company shall have performed all of its obligations hereunder theretofore to be
performed, and the following additional conditions:
(a) The Registration Statement shall have become effective not later
than 5:30 P.M. Washington, D.C. time on the date of this Agreement and, if Rule
430A under the Act is used, the Prospectus shall have been filed with the
Commission pursuant to Rule 424(b) under the Act at or before 5:30 P.M.,
Washington D.C. time, on the second full business day after the date of this
Agreement, and any registration statement pursuant to Rule 462(b) under the Act
required in connection with the offering and sale of the Shares shall have been
filed and become effective no later than 10:00 p.m., Washington D.C. time, on
the date of this Agreement, and no stop order suspending the effectiveness of
the Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of the
Commission shall have been complied with to your reasonable satisfaction;
(b) No Prospectus or amendment or supplement to the Registration
Statement or the Prospectus, including documents deemed to be incorporated by
reference therein, shall have been filed to which you object in writing;
(c) Xxxxxxx Coie LLP, counsel to the Underwriters, shall have
furnished to you such opinion or opinions, dated such Time of Delivery, with
respect to this Agreement, the Registration Statement, the Prospectus, and other
related matters as you may reasonably request;
(d) Stoel Rives LLP, counsel to the Company, shall have furnished to
you their written opinion, dated such Time of Delivery, in form and substance
reasonably satisfactory to you, with respect to the matters set forth in Annex I
hereto;
(e) On the date hereof and also at each Time of Delivery KPMG LLP
shall have furnished to you a letter or letters, dated the respective date of
delivery thereof, in form and substance satisfactory to you;
(f) (i) The Company shall not have sustained since the date of the
latest audited financial statements included in the Prospectus any loss or
interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, other than as set forth or contemplated in
the Prospectus, and (ii) since the respective dates as of which information is
given in the Prospectus, there shall not have been any change in the capital
stock (other than issuances of Common Stock pursuant to Company stock option and
stock purchase plans described in the Registration Statement and Prospectus) or
long-term debt of the Company and there shall not have occurred any Material
Adverse Change, other than as set forth or contemplated in the Prospectus, the
effect of which, in any such case described in clause (i) or (ii), is in the
judgment of the Representatives so material and adverse as to make it
impracticable
-13- UNDERWRITING AGREEMENT
or inadvisable to proceed with the public offering or the delivery of the Shares
being delivered at such Time of Delivery on the terms and in the manner
contemplated in the Prospectus;
(g) On or after the date hereof there shall not have occurred any of
the following: (i) additional material governmental restrictions, not in force
and effect on the date hereof, shall have been imposed upon trading in
securities generally or minimum or maximum prices shall have been generally
established on the New York Stock Exchange or the Nasdaq National Market or in
the over-the-counter market by the NASD, or trading in securities generally
shall have been suspended on the New York Stock Exchange, the Nasdaq National
Market or in the over the counter market by the NASD, or a general banking
moratorium shall have been established by federal or New York authorities, (ii)
a suspension or material limitation in trading in the Company's securities on
the Nasdaq National Market, (iii) an outbreak of major hostilities or other
national or international calamity or any substantial change in political,
financial or economic conditions shall have occurred or shall have accelerated
or escalated to such an extent, as, in the judgment of the Representatives, to
affect materially and adversely the marketability of the Shares, or (iv) there
shall be any action, suit or proceeding pending or threatened, or there shall
have been any development or prospective development involving particularly the
business or properties or securities of the Company or the transactions
contemplated by this Agreement, which, in the judgment of the Representatives,
has materially and adversely affected the Company's business or earnings and
makes it impracticable or inadvisable to offer or sell the Shares;
(h) The Shares to be sold at such Time of Delivery shall have been
duly listed for quotation on the Nasdaq National Market System;
(i) Each director and officer of the Company shall have executed and
delivered to you agreements in which such holder undertakes, for 180 days after
the date of the Prospectus, subject to certain exceptions stated therein, not to
offer, sell, contract to sell, pledge, grant any option to purchase, make any
short sale or otherwise dispose of any shares of Common Stock, or any securities
convertible into or exchangeable for, or any rights to purchase or acquire,
shares of Common Stock, without the prior written consent of Xxxxx, Xxxxxxxx &
Xxxx, Inc.;
(j) The Company shall have furnished or caused to be furnished to
you at such Time of Delivery certificates of officers of the Company, reasonably
satisfactory to you, as to the accuracy of the representations and warranties of
the Company herein at and as of such Time of Delivery, as to the performance by
the Company, of all of its obligations hereunder to be performed at or prior to
such Time of Delivery, and as to such other matters as you may reasonably
request; and the Company shall have furnished or caused to be furnished
certificates as to the matters set forth in subsections (a) and (g) of this
Section 7, and as to such other matters as you may reasonably request; and
(k) Yaskawa Electric Corporation shall have furnished or caused to
be furnished to you a certificate of an officer of the Yaskawa Electric
Corporation, reasonably satisfactory to you, as to its lack of knowledge of any
fact, condition or information that would cause the Registration Statement, the
Preliminary Prospectus, the Prospectus or any amendments or supplements thereto
to contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein necessary to make the statements therein not
misleading.
-14- UNDERWRITING AGREEMENT
8. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless each Underwriter
and each person, if any, who controls such Underwriter against any losses,
claims, damages or liabilities, joint or several, to which such Underwriter or
controlling person may become subject, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged untrue statement
of a material fact contained in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or any amendment or supplement thereto, or any new
registration statement or prospectus referred to in 6(c) herein, or in any
marketing materials or information provided to investors by, or with the
approval of, the Company in connection with the marketing of the offering of the
Shares, including any roadshow or investor presentations made to investors by
the Company (whether in person or electronically), or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
and will reimburse each Underwriter for any legal or other expenses reasonably
incurred by such Underwriter in connection with investigating or defending any
such action or claim as such expenses are incurred; provided that the Company
shall not be liable in any such case to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement or the Prospectus or any such amendment
or supplement, or any new registration statement or prospectus referred to in
Section 5(c) herein, in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through Xxxxx, Xxxxxxxx & Xxxx, Inc.
expressly for use therein.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or any new registration
statement or prospectus referred to in Section 5(c) herein, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in any Preliminary Prospectus, the Registration Statement or the Prospectus or
any such amendment or supplement, or any new registration statement or
prospectus referred to in Section 5(c) herein, in reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through you expressly for use therein; and will reimburse the Company for any
legal or other expenses reasonably incurred by the Company in connection with
investigating or defending any such action or claim as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified
-15- UNDERWRITING AGREEMENT
party other than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the written consent
of the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party
to such action or claim) unless such settlement, compromise or judgment (i)
includes an unconditional release of the indemnified party from all liability
arising out of such action or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act, by or on behalf of
any indemnified party. No indemnifying party shall be liable for any settlement
of any action or claim effected without its written consent, which consent shall
not be unreasonably withheld. 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 Sections 8(a) and (b), then the indemnifying party agrees that it shall be
liable for any settlement of any action or claim effected without its written
consent if (i) such settlement is entered into more than 60 days after receipt
by such indemnifying party of the aforesaid request, (ii) such indemnifying
party shall not have fully reimbursed the indemnified party in accordance with
such request prior to the date of such settlement and (iii) such indemnified
party shall have given the indemnifying party at least 30 days' prior notice of
its intention to settle.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriters
on the other from the offering of the Shares. If, however, the allocation
provided by the immediately preceding sentence is not permitted by applicable
law or if the indemnified party failed to give the notice required under
subsection (c) above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
faults of the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriters on the other 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 underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover page of the Prospectus. The
-16- UNDERWRITING AGREEMENT
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged 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 the Underwriters on the other and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company and the Underwriters agree that it would
not be just and equitable if contributions pursuant to this subsection (d) were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this
subsection (d). The amount paid or payable by an indemnified party as a result
of the losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (d) shall be deemed to include 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 subsection (d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Shares underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which such Underwriter 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 Underwriters' obligations in this subsection (d) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriter under this Section 8 shall be in addition to any liability which the
respective Underwriters may otherwise have and shall extend, upon the same terms
and conditions, to each officer and director of the Company and to each person,
if any, who controls the Company within the meaning of the Act.
9. Termination.
(a) If any Underwriter shall default in its obligation to purchase
the Shares which it has agreed to purchase hereunder at a Time of Delivery, you
may in your discretion arrange for you or another party or other parties to
purchase such Shares on the terms contained herein. If within thirty-six (36)
hours after such default by any Underwriter you do not arrange for the purchase
of such Shares, then the Company shall be entitled to a further period of
thirty-six (36) hours within which to procure another party or other parties
satisfactory to you to purchase such Shares on such terms. In the event that,
within the respective prescribed periods, you notify the Company that you have
so arranged for the purchase of such Shares, or the Company notifies you that
they have so arranged for the purchase of such Shares, you or the Company shall
have the right to postpone such Time of Delivery for a period of not more than
seven (7) days, in order to effect whatever changes may thereby be made
necessary in the Registration Statement or the Prospectus, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments to the Registration Statement or the Prospectus which in your opinion
may thereby be made necessary. The term "Underwriter" as
-17- UNDERWRITING AGREEMENT
used in this Agreement shall include any person substituted under this Section 9
with like effect as if such person had originally been a party to this Agreement
with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of
the Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased does not exceed one-tenth of the aggregate number of all the
Shares to be purchased at such Time of Delivery, then the Company shall have the
right to require each non-defaulting Underwriter to purchase the number of
Shares which such Underwriter agreed to purchase hereunder at such Time of
Delivery and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Shares which such
Underwriter agreed to purchase hereunder) of the Shares of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of
the Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased exceeds one-tenth of the aggregate number of all the Shares
to be purchased at such Time of Delivery, or if the Company shall not exercise
the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Shares of a defaulting Underwriter or Underwriters,
then this Agreement (or, with respect to the Second Time of Delivery, the
obligations of the Underwriters to purchase and of the Company to sell the
Optional Shares) shall thereupon terminate, without liability on the part of any
non-defaulting Underwriter or the Company, except for the expenses to be borne
by the Company and the Underwriters as provided in Section 6 hereof and the
indemnity and contribution agreements in Section 8 hereof, but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
10. Survival. The respective indemnities, agreements, representations,
warranties and other statements of the Company and the several Underwriters, as
set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or any controlling person of any Underwriter, or the
Company, or any officer or director or controlling person of the Company, and
shall survive delivery of and payment for the Shares.
11. Expenses of Termination. If this Agreement shall be terminated
pursuant to Section 9 hereof, the Company shall then have no liability to any
Underwriter except as provided in Section 6 and Section 8 hereof; but, if for
any other reason this Agreement is terminated, or the transactions contemplated
hereby shall not have been consummated due to any of the conditions set forth in
Section 7 hereof not having been met, or the Shares are not delivered by or on
behalf of the Company as provided herein, the Company will reimburse the
Underwriters through you for all out-of-pocket expenses approved in writing by
you, including fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and delivery of the
Shares not so delivered.
12. Notice. In all dealings hereunder, you shall act on behalf of each of
the Underwriters, and the parties hereto shall be entitled to act and rely upon
any statement, request,
-18- UNDERWRITING AGREEMENT
notice or agreement on behalf of any Underwriter made or given by you jointly or
by Xxxxx, Xxxxxxxx & Xxxx, Inc. on behalf of you as the Underwriters.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the Underwriters in care of Xxxxx, Xxxxxxxx &
Xxxx, Inc., 00 Xxxxx Xxxxxx, Xxxxxx, XX 00000, Attention: General Counsel; and
if to the Company shall be delivered or sent by mail, telex or facsimile
transmission to the address of the Company set forth in the Registration
Statement, Attention: President; provided, however, that any notice to an
Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by mail,
telex or facsimile transmission to such Underwriter at its address set forth in
its Underwriter's Questionnaire or telex constituting such Questionnaire, which
address will be supplied to the Company by you on request. Any such statements,
requests, notices or agreements shall take effect upon receipt thereof.
13. Information Provided by the Underwriters. The Company and the
Underwriters acknowledge that, for purposes of this Agreement, the statements
set forth in the third and fourteenth paragraphs under the heading "Plan of
Distribution" in the Prospectus constitute the only information relating to any
Underwriter furnished in writing to the Company by any Underwriter specifically
for inclusion in the Registration Statement or the Prospectus.
14. Miscellaneous.
(a) This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters and the Company and, to the extent provided in
Sections 8 and 10 hereof, the officers and directors of the Company and each
person who controls the Company or any Underwriter, and their respective heirs,
executors, administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement. No purchaser of
any of the Shares from any Underwriter shall be deemed a successor or assign by
reason merely of such purchase.
(b) Time shall be of the essence of this Agreement. As used herein,
the term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
(c) This Agreement shall be governed by and construed in accordance
with the laws of The Commonwealth of Massachusetts.
(d) This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
[signature page follows]
-19-
UNDERWRITING AGREEMENT
If the foregoing is in accordance with your understanding, please sign and
return to us six counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof shall
constitute a binding agreement among each of the Underwriters and the Company.
It is understood that your acceptance of this letter on behalf of each of the
Underwriters is pursuant to the authority set forth in a form of Agreement among
Underwriters, the form of which shall be submitted to the Company for
examination, upon request, but without warranty on your part as to the authority
of the signors thereof.
Very truly yours,
SYNETICS SOLUTIONS INC.
By:
----------------------------------
Name:
----------------------------
Title:
---------------------------
Accepted as of the date hereof at
Boston, Massachusetts
XXXXX, XXXXXXXX & XXXX, INC.,
NOMURA SECURITIES INTERNATIONAL, INC.
XXXXX FARGO SECURITIES, INC.
By:
---------------------------------
Name: Xxxx X. Xxxxx
Title: Managing Director
SIGNATURE PAGE TO UNDERWRITING AGREEMENT
SCHEDULE I
Number of
Optional Shares
Total Number to be Purchased
of Firm Shares if Maximum
to be Purchased Option Exercised
--------------- ----------------
Xxxxx, Xxxxxxxx & Xxxx, Inc.........
Xxxxx Fargo Securities, LLC.........
Nomura Securities International, Inc.
TOTAL...............................
SCHEDULE I TO UNDERWRITING AGREEMENT
ANNEX I
Form of Opinion of Stoel Rives LLP
1. The Company is a corporation duly incorporated and validly existing
under the laws of the State of Oregon, with corporate power and authority to
own, lease and operate its properties and conduct its business as described in
the Prospectus. The Company is duly qualified to do business and is in good
standing in each jurisdiction in the United States in which, to such counsel's
knowledge, it owns or leases real property or maintains an office.
2. The authorized capitalization of the Company is as set forth under the
caption "Capitalization" in the Prospectus, and, to such counsel's knowledge,
there are no outstanding stock options, warrants or other securities convertible
into, or exercisable for, capital stock of the Company not described in the
Registration Statement. All of the issued and outstanding shares of capital
stock have been duly authorized and validly issued and are fully paid and
nonassessable and have not been issued in violation of any statutory preemptive
right or, to such counsel's knowledge, any other similar right. The Shares have
been duly authorized and, when issued and delivered in accordance with the
Underwriting Agreement, will be validly issued, fully paid and nonassessable and
will conform in all material respects to the description of the capital stock
contained in the Prospectus.
3. The Company has the corporate power and authority to enter into the
Underwriting Agreement and perform its obligations thereunder and the
Underwriting Agreement has been duly authorized, executed and delivered by the
Company.
4. The issuance and sale by the Company of the Shares and the performance
by the Company of its obligations under the Underwriting Agreement does not and
will not, whether with or without the giving of notice or passage of time or
both (i) violate the Articles of Incorporation or By-laws of the Company, (ii)
breach or result in a default under any agreement, indenture or other instrument
filed as an exhibit to the Registration Statement or listed on a Schedule
containing such agreements identified by you, or (iii) violate any treaty, law,
rule or administrative regulation applicable to the Company or any judgment,
order or decree known to such counsel of any court or any governmental agency or
body having jurisdiction over the Company or any of its properties (other than
state securities and blue sky laws).
5. No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is required
for the issuance and sale of the Shares by the Company or the consummation by
the Company of the transactions contemplated by the Underwriting Agreement,
except the registration under the Act of the Shares or qualifications under
state securities and blue sky laws.
6. The Company is not, and after receipt of payment for the Shares will
not be, an "investment company" as such term is defined in the Investment
Company Act of 1940, as amended.
7. To such counsel's knowledge and other than as set forth in the
Prospectus, there are no legal or governmental proceedings pending or threatened
to which the Company is a party
ANNEX I TO UNDERWRITING AGREEMENT
or of which any property of the Company is the subject which are required to be
disclosed in the Registration Statement, other than those disclosed therein.
8. The information in the Registration Statement and the Prospectus under
the headings (a) "Business - Strategic Relationship," (b) "Business -
Intellectual Property," (c) "Management - Board of Directors; - Board
Composition; - Committees of the Board of Directors; - Stock Incentive Plan; -
Limitations on Directors' Liability and Indemnification," (d) "Related Party
Transactions," (e) "Description of Capital Stock," (f) "Shares Eligible for
Future Sale," (g) Certain United States Federal Tax Considerations" and (h)
"Principal and Selling Shareholders," insofar as such statements constitute a
summary of documents or matters of law, are accurate in all material respects
and present fairly the information required to be shown and presented therein.
9. The Registration Statement, including any Rule 462(b) Registration
Statement, the Prospectus, and each amendment or supplement to the Registration
Statement and the Prospectus, as of their respective effective or issue dates
(other than the financial statements and supporting schedules included therein,
as to which no opinion need be rendered) comply as to form in all material
respects with the applicable requirements of the Securities Act and any required
filing of the Prospectus and any supplement thereto pursuant to Rule 424(b)
under the Securities Act has been made in the manner and within the time period
required by such Rule 424(b).
10. To such counsel's knowledge, there are no affiliate transactions or
contracts, licenses agreements, leases or documents of a character which are
required to be described in the Registration Statement or the Prospectus or to
be filed as an exhibit to the Registration Statement which have not been so
described or filed.
Such counsel shall also state that in the course of the preparation by the
Company of the Registration Statement and the Prospectus, they have participated
in discussions with your representatives and those of the Company and its
independent accountants in which the business and affairs of the Company and the
contents of the Registration Statement and Prospectus were discussed. Such
counsel shall state that on the basis of information that such counsel has
gained in the course of such counsel's representation of the Company in
connection with its preparation of the Registration Statement and Prospectus and
such counsel's participation in the discussions referred to above, nothing has
come to the attention of such counsel that has caused such counsel to believe
that (i) the Registration Statement as of its effective date contained an untrue
statement of material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, (ii)
that the Prospectus as of its date contained, or as of such Time of Delivery and
the date of the opinion, if different, contains, any untrue statement of a
material fact or omitted or omits to state any material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading or (iii) it is necessary to amend the Registration
Statement. Such counsel need make no statement, however, as to the financial
statements, including the notes and schedules thereto, or any other financial or
accounting information set forth or referred to in the Registration Statement
and Prospectus.
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ANNEX I TO UNDERWRITING AGREEMENT
Such counsel shall also state that the Registration Statement and the Rule
462(b) Registration Statement, if any, have been declared effective by the
Commission under the Securities Act (it being understood that counsel may base
its opinion on an oral conversation with the SEC staff) and, to the knowledge of
such counsel, no stop order suspending the effectiveness of either of the
Registration Statement or the Rule 462(b) Registration Statement, if any, has
been issued under the Securities Act and no proceedings for such purpose have
been instituted or are pending or are contemplated or threatened by the
Commission.
Such counsel may state that the limitations inherent in the independent
verification of factual matters and the character of the determinations involved
in such counsel's review are such that such counsel does not assume any
responsibility for the accuracy, completeness or fairness of the statements made
or the information contained in the Registration Statement and Prospectus except
for those statements referred to in opinion Paragraphs 2, 7, and 8 above.
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ANNEX I TO UNDERWRITING AGREEMENT
