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EXHIBIT 1.1
BOLDER TECHNOLOGIES CORPORATION
UNDERWRITING AGREEMENT
As of November 8, 1999
FIRST SECURITY XXX XXXXXX INC.
As Representative of the
Several Underwriters
First Security Xxx Xxxxxx Inc.
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Ladies and Gentlemen:
BOLDER Technologies Corporation, a Delaware corporation (the
"Company"), proposes to issue and sell to the several Underwriters named in
Schedule I hereto (the "Underwriters") an aggregate of 2,200,000 shares, each
with one associated "Right" (as described in the "Base Prospectus" (defined
below)) (including such Rights, the "Firm Shares") of the Company's Common
Stock, $0.001 par value per share (the "Common Stock"). The Company also
proposes to grant to the Underwriters an option to purchase up to 330,000
additional shares of Common Stock, each with one associated Right (including
such Rights, the "Option Shares") for the sole purpose of covering
over-allotments, if any, in connection with the sale of the Firm Shares. The
Firm Shares and any Option Shares are referred to below as the "Shares." First
Security Xxx Xxxxxx Inc. is acting as representative of the several Underwriters
and in that capacity is referred to in this Agreement as the "Representative".
The Company has filed, in accordance with the Securities Act of 1933,
as amended (the "Securities Act"), and the rules and regulations thereunder (the
"Rules and Regulations"), with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (File No. 333-86235),
including a base prospectus, relating to $30,000,000 of securities (including
the Shares) and the offering thereof from time to time in accordance with Rule
415 under the Securities Act, which incorporates by reference documents which
the Company has filed or will file in accordance with the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and the rules and regulations
thereunder (the "Exchange Act Rules and Regulations"). As used in this
Agreement, "Base Prospectus" means the prospectus included in the Registration
Statement when it became effective under the Securities Act on September 17,
1999 and as it may have been amended subsequent to that date to the date hereof.
The Company has furnished to you and the other Underwriters, for use by you,
them and dealers, copies of a preliminary prospectus supplement or preliminary
prospectus supplements relating to the Shares, including the Base Prospectus and
all documents incorporated by reference in the Base Prospectus (collectively,
the "Preliminary Prospectus Supplement/Prospectus"). As used below in this
Agreement: (i) registration statement (File No. 333-86235), as in effect at the
time of execution of this Agreement, including the Base Prospectus and all
documents incorporated by reference in the Base Prospectus, is referred to as
the "Registration Statement"; (ii) the final prospectus supplement relating to
the Shares, including the Base Prospectus and all documents
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incorporated in the Base Prospectus by reference, in the form first filed by the
Company with the Commission pursuant to Rule 424(b) under the Securities Act, is
referred to below as the "Prospectus Supplement/ Prospectus"; and (iii) except
where otherwise stated, references to any specific Rule or Rules refers to Rules
that are part of the Rules and Regulations.
The Company agrees with the several Underwriters as set forth below.
1. Representations and Warranties of the Company. The Company
represents and warrants to each Underwriter as follows:
(a) The Company meets and has satisfied the requirements for
use of Form S-3 under the Securities Act. The Company has prepared and
filed the Registration Statement with the Commission on Form S-3, for
registration under the Securities Act of the offering and sale of the
Shares. The Registration Statement has been declared effective by the
Commission. The Company has filed the Preliminary Prospectus
Supplement/Prospectus with the Commission in accordance with Rule
424(b). The Company will next file with the Commission, in accordance
with Rules 430A and 424(b) under the Securities Act, the Prospectus
Supplement/Prospectus.
(b) The Preliminary Prospectus Supplement/Prospectus filed
pursuant to Rule 424(b) complied in all material respects with the
Securities Act, the Rules and Regulations, the Exchange Act and the
Exchange Act Rules and Regulations. When the Registration Statement
became effective and at all times subsequent thereto up to the "Time of
Purchase" (defined below) and, if applicable, the "Additional Time of
Purchase" (defined below), the Registration Statement and the
Prospectus Supplement/Prospectus, and any supplements or amendments
either of them, complied and will comply in all material respects with
the Securities Act, the Rules and Regulations, the Exchange Act and the
Exchange Act Rules and Regulations, and each of the Registration
Statement and the Prospectus Supplement/Prospectus at all such times
did not and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading; provided that the Company
makes no representation or warranty with respect to any statement
contained in the Prospectus Supplement/Prospectus in reliance upon and
in conformity with information concerning the Underwriters and
furnished in writing by or on behalf of any Underwriter through you to
the Company expressly for use in, and set forth in, the section of the
Prospectus Supplement/Prospectus entitled "Underwriting"; the documents
incorporated by reference in the Base Prospectus, at the time they were
filed with the Commission (or, if an amendment with respect to any of
them was filed, when it was so filed), complied in all material
respects with the requirements of the Exchange Act and the Exchange Act
Rules and Regulations and, without limitation and except to the extent,
if any, they are modified or superseded by the Registration Statement
or the Prospectus Supplement/Prospectus, did not and do not contain an
untrue statement of material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; and the Company has
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complied and, until completion of the offering of the Shares will
continue to comply, with its obligations under the Exchange Act and the
Exchange Act Rules and Regulations.
(c) No order suspending the effectiveness of the Registration
Statement or preventing or suspending the use of any Preliminary
Prospectus Supplement/Prospectus or the Prospectus
Supplement/Prospectus has been issued and no proceedings for that
purpose are pending or, to the knowledge of the Company, threatened or
contemplated by the Commission; no stop order suspending the sale of
the Shares in any jurisdiction has been issued and no proceedings for
that purpose are pending or, to the knowledge of the Company,
threatened or contemplated; and any request of the Commission for
additional information, whether to be included in the Registration
Statement, any Preliminary Prospectus Supplement/Prospectus or the
Prospectus Supplement/Prospectus or otherwise, has been complied with.
(d) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of Delaware,
has the power (corporate and other) and authority to own or lease its
properties and conduct its business as described in the Registration
Statement and the Prospectus Supplement/Prospectus (or, if the
Prospectus Supplement/Prospectus is not in existence, the most recent
Preliminary Prospectus Supplement/Prospectus) and as is currently being
conducted by it and is duly qualified as a foreign corporation and in
good standing in all jurisdictions in which the character of the
property owned or leased or the nature of the business transacted by it
makes qualification necessary (except where the failure to be so
qualified would not have a material adverse effect on the business,
results of operations, condition (financial or other) or prospects of
the Company). The Company has and is operating in compliance in all
material respects with all authorizations, licenses, certificates,
consents, orders and permits from federal, state, local and other
governmental or regulatory authorities that are material to the conduct
of its business, all of which are valid and in full force and effect.
The Company does not have any "subsidiaries" ("subsidiary" meaning any
corporation, partnership, limited liability company or other entity of
which the Company directly or indirectly owns 50% or more of the equity
or that the Company directly or indirectly controls).
(e) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus
Supplement/Prospectus (or, if the Prospectus Supplement/Prospectus is
not in existence, the most recent Preliminary Prospectus
Supplement/Prospectus), there has not been any material loss or
interference with the business of the Company from fire, explosion,
flood, earthquake, riot or other civil disturbance or other calamity,
whether or not covered by insurance, or from any court or governmental
action, order or decree, or any changes in the capital stock or
long-term debt of the Company, or any dividend or distribution of any
kind declared, paid or made on the capital stock of the Company, or any
material change, or a development known to the Company that might cause
or result in a material change, in or affecting the business, results
of operations, condition (financial or other) or prospects of the
Company, whether or not arising from transactions in the ordinary
course of business, in each case other than as may be set forth in the
Registration Statement and the Prospectus Supplement/Prospectus (or, if
the Prospectus Supplement/Prospectus is not in existence, the most
recent Preliminary Prospectus Supplement/Prospectus), and since each
such date, the Company has not entered into any material transaction
not described in the Registration Statement and the Prospectus
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Supplement/Prospectus (or, if the Prospectus Supplement/Prospectus is
not in existence, the most recent Preliminary Prospectus
Supplement/Prospectus).
(f) There is no agreement, contract, license, lease or other
document required to be described in the Registration Statement or the
Prospectus Supplement/Prospectus (or, if the Prospectus
Supplement/Prospectus is not in existence, the most recent Preliminary
Prospectus Supplement/Prospectus) or to be filed as an exhibit to the
Registration Statement which is not described or filed as required. All
contracts described in the Prospectus Supplement/Prospectus (or, if the
Prospectus Supplement/Prospectus is not in existence, the most recent
Preliminary Prospectus Supplement/Prospectus), if any, are in full
force and effect, and neither the Company nor, to the knowledge of the
Company, any other party, is in material breach of or default under any
such contract.
(g) The authorized and outstanding capital stock of the
Company is set forth in the Prospectus Supplement/Prospectus (or, if
the Prospectus Supplement/Prospectus is not in existence, the most
recent Preliminary Prospectus Supplement/Prospectus), and the
description of the Common Stock (including the Rights) therein conforms
with and accurately describes the rights set forth in the instruments
defining the Common Stock (including the Rights). The Shares to be
issued and sold by the Company are duly authorized and, when issued and
delivered in accordance with the terms of this Agreement and against
payment therefor, will be validly issued, fully paid and
non-assessable. The issuance of the Shares by the Company is not
subject to any preemptive or similar rights.
(h) The capitalization of the Company as of June 30, 1999 is
as set forth under the column entitled "June 30, 1999 - Actual" in the
section of the Prospectus Supplement/Prospectus (or, if the Prospectus
Supplement/Prospectus is not in existence, the Preliminary Prospectus
Supplement/Prospectus) entitled "Capitalization" and, as of the Time of
Purchase, assuming the Time of Purchase had been June 30, 1999, and pro
forma for the receipt of the net proceeds of the Company's July 1997
private placement of Common Stock, the capitalization of the Company
would have been as set forth under the column entitled "June 30, 1999 -
Pro Forma As Adjusted" in the section of the Prospectus
Supplement/Prospectus entitled Capitalization." All of the outstanding
shares of capital stock of the Company (including the Rights) have been
duly authorized and validly issued and are fully paid and
nonassessable, have been issued in compliance with all applicable
federal and state securities laws and were not issued in violation of
or subject to any preemptive rights or other rights to subscribe for or
purchase securities. The description of the Company's stock option,
stock bonus and other stock plans or arrangements, and the options or
other rights granted or exercised thereunder, set forth in the
Prospectus Supplement/Prospectus (or, if the Prospectus
Supplement/Prospectus is not in existence, in the most recent
Preliminary Prospectus Supplement/Prospectus), accurately and fairly
present the information required to be shown with respect to such
plans, arrangements,
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options and rights. Other than this Agreement, the Warrant Agreement
between the Company and First Security Xxx Xxxxxx Inc. covering
warrants to purchase 66,000 shares of the Common Stock (including
associated Rights) (the "Warrant Agreement"), outstanding options to
purchase Common Stock, options to purchase 622,000 shares of Common
Stock granted to Xxxxx Xxxxxx pursuant to his Key Employee Agreement,
dated September 1999, options to purchase 70,553 shares of Common Stock
granted pursuant to the Company's 1996 Equity Incentive Plan since June
30, 1999 and additional options to purchase Common Stock issued after
the date of this Agreement pursuant to existing stock option plans,
outstanding warrants to purchase Common Stock, outstanding securities
convertible into Common Stock, securities issuable pursuant to existing
employee compensation plans and pursuant to the Rights (provided that
the Rights are not exercisable), in each case as described in the
Prospectus Supplement/Prospectus (or, if the Prospectus
Supplement/Prospectus is not in existence, the most recent Preliminary
Prospectus Supplement/Prospectus), there are no options, warrants or
other rights outstanding to subscribe for or purchase any shares or any
securities convertible into or exchangeable for any capital stock of
the Company. There are no preemptive rights applicable to any shares of
capital stock of the Company. There are no restrictions upon the voting
or transfer of any of the Shares pursuant to the Company's Certificate
of Incorporation, bylaws or other governing documents or any agreement
to which the Company is a party or by which it may be bound. Except as
is provided in the Warrant Agreement and for the Shares, neither the
filing of the Registration Statement nor the offering or sale of the
Shares as contemplated by this Agreement gives rise to any rights,
other than those which have been waived, for or relating to the
registration of any securities of or issued by the Company. The Rights
are not now and never have been transferable separately from the shares
of Common Stock or exercisable. No Person, including any of the
Company's shareholders at the time of the issuance of the Rights, has
at any time been an Acquiring Person, a Principal Party or a
Transaction Person, and no Distribution Date, Shares Acquisition Date
or Transaction has occurred or been proposed. The execution of this
Agreement and the Warrant Agreement and the completion of the
transactions contemplated hereby and thereby, including the acquisition
of the Shares and any Common Stock purchased by any Underwriter in
connection with stabilization will not cause: (i) any Underwriter to
become an Acquiring Person, a Principal Party or a Transaction Person;
(ii) a Distribution Date, a Shares Acquisition Date or a Transaction to
occur or (iii) any Underwriter or any two or more Underwriters taken
together to be, or to have been, the "Beneficial Owner" and/or to
"beneficially own" any of (A) the Shares it or they had or have the
right to acquire under the Underwriting Agreement, (B) the Shares it or
they acquire under the Underwriting Agreement or (C) any shares of
Common Stock it or they acquire in stabilization transactions related
to the distributions or proposed distribution of the Shares
contemplated by the Underwriting Agreement. The Amendment to the
"Rights Agreement" (defined below) dated November 8, 1999, was duly
authorized, executed and delivered by the Company and the Rights Agent
and amended the Rights Agreement effective as of January 23, 1998.
There have been no other amendments to the Rights Agreement. As used in
this section the following terms have the meanings given to them in the
Rights Agreement dated as of January 23, 1998 between the Company and
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American Stock Transfer & Trust Company, as Rights Agent (the "Rights
Agreement"): "Beneficial Owner", "beneficially own", "Person",
"Acquiring Person", "Principal Party", "Transaction Person",
"Distribution Date", "Shares Acquisition Date" and "Transaction".
(i) The Company has power (corporate and other) to enter into
and perform its obligations under this Agreement and the Warrant
Agreement and to issue, sell and deliver the securities to be delivered
by it pursuant hereto and thereto. This Agreement and the Warrant
Agreement have each been duly authorized, executed and delivered by the
Company and constitute the valid and binding agreements of the Company,
and each is enforceable against the Company in accordance with its
terms except insofar as enforceability may be affected by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
creditors' rights generally or by general equitable considerations and
except insofar as the indemnification and contribution provisions of
Section 7 of this Agreement and Section 3(f) of the Warrant Agreement
may be affected by public policy concerns.
(j) The Company is not, nor with the giving of notice or lapse
of time or both would it be, in violation of or in default under, nor
will the execution or delivery of this Agreement or the Warrant
Agreement or the completion of the transactions contemplated by this
Agreement or the Warrant Agreement result in a violation of or
constitute a breach of or a default (including without limitation with
the giving of notice, the passage of time or both) under, the
Certificate of Incorporation, bylaws or other governing documents of
the Company or any evidence of indebtedness, contract, license, joint
venture or other agreement or instrument of any type whatsoever to
which the Company is a party or by which it or any of its properties is
bound except that no representation or warranty is made with respect to
certain matters set forth in a letter delivered by the Company, dated
the date hereof, to the Representative, other than a representation
that any breaches of or defaults under the agreements referred to in
that letter, if in fact any such matters are breaches or defaults, are
not material to the Company. The Company has not incurred any
liability, direct or indirect, for any finders' or similar fees payable
on behalf of the Company or the Underwriters in connection with the
transactions contemplated by this Agreement or the Warrant Agreement.
The performance by the Company of its obligations under this Agreement
and the Warrant Agreement will not violate any law, ordinance, rule or
regulation (provided that no representation or warranty is made with
respect to the effect, if any, of public policy concerns on the
indemnification and contribution provisions of Section 7 of this
Agreement and Section 3(f) of the Warrant Agreement), or any order,
writ, injunction, judgment or decree of any governmental agency or body
or of any court or result in the creation or imposition of any lien,
charge, claim, encumbrance or right of any third party of any type or
description on any property of the Company. No consent, approval,
authorization or order of any court, governmental agency or body
(except as has been obtained), financial institution or any other
person is required for the completion of the transactions contemplated
by this Agreement or, except for filings under the Securities Act
required by Section 3 of the Warrant Agreement, the Warrant Agreement.
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(k) The Company owns, or has valid rights to use, all items of
real and personal property which are material to the business of the
Company, free and clear, except as described in the Registration
Statement and the Prospectus Supplement/Prospectus (or, if the
Prospectus Supplement/Prospectus is not in existence, the most recent
Preliminary Prospectus Supplement/Prospectus), of all liens, charges,
claims, encumbrances and rights of third parties of any type or
description that might materially interfere with the business, results
of operations, condition (financial or other) or prospects of the
Company.
(l) The Company owns or possesses adequate rights to use all
patents, patent rights, inventions, trade secrets, know-how,
trademarks, service marks, tradenames and copyrights which are
necessary for the conduct of its business. Except as set forth in the
Prospectus Supplement/Prospectus (or, if the Prospectus
Supplement/Prospectus is not in existence, the most recent Preliminary
Prospectus Supplement/Prospectus), the Company has not received any
notice of infringement of or conflict with asserted rights of others
with respect to any patents, patent rights, inventions, trade secrets,
know-how, trademarks, service marks, tradenames or copyrights which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, might have a material adverse effect on the
business, results of operations, condition (financial or other) or
prospects of the Company.
(m) Except as set forth in the Prospectus
Supplement/Prospectus (or, if the Prospectus Supplement/Prospectus is
not in existence, the most recent Preliminary Prospectus
Supplement/Prospectus), there is no litigation or governmental
proceeding to which the Company is a party or to which any property of
the Company is subject which is pending or, to the best knowledge of
the Company, threatened or contemplated against the Company or its
property that (i) might have a material effect on, or might result in
any material adverse change in, the business, results of operations,
condition (financial or other) or prospects of the Company, (ii) might
prevent completion of the transactions contemplated by this Agreement
or the Warrant Agreement or (iii) is required to be disclosed in the
Registration Statement or Prospectus Supplement/ Prospectus (or, if the
Prospectus Supplement/Prospectus is not in existence, the most recent
Preliminary Prospectus Supplement/Prospectus) and is not so disclosed.
(n) The Company is not in violation of any law, order,
ordinance, rule or regulation, or any order, writ, injunction, judgment
or decree of any governmental agency or body or of any court, to which
it or its properties (whether owned or leased) may be subject, which
violation might have a material adverse effect on the business, results
of operations, condition (financial or other) or prospects of the
Company.
(o) The Company has not taken and will not take, directly or
indirectly, any action designed to cause or result in, or which has
constituted or which might reasonably be expected to cause or result
in, under the Exchange Act, the Exchange Act Rules and Regulations or
otherwise, the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Shares.
No bid or purchase by the Company and, to the best knowledge of the
Company, no bid or purchase that could be
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attributed to the Company (as a result of bids or purchases by an
"affiliated purchaser" within the meaning of Regulation M under the
Exchange Act) for or of the Common Stock, any securities of the same
class or series as the Common Stock or any securities convertible into
or exchangeable for or that represent any right to acquire the Common
Stock is now pending or in progress or will have commenced at any time
prior to the completion of the distribution of the Shares.
(p) Xxxxxx Xxxxxxxx LLP, whose report appears in the
Registration Statement and the Prospectus Supplement/Prospectus (or, if
the Prospectus Supplement/Prospectus is not in existence, the most
recent Preliminary Prospectus Supplement/Prospectus) is, and during the
periods covered by that report were, independent accountants as
required by the Securities Act and the Rules and Regulations. The
financial statements and schedules included in the Registration
Statement, each Preliminary Prospectus Supplement/ Prospectus and the
Prospectus Supplement/Prospectus present fairly (or, if the Prospectus
Supplement/Prospectus has not been filed with the Commission, as to the
Prospectus Supplement/Prospectus, will present fairly) the financial
condition, results of operations, changes in shareholders' equity
(deficit) and cash flows of the Company at the dates and for the
periods indicated, and each of those financial statements and schedules
present fairly the information required to be stated therein. Such
financial statements and schedules have been prepared in accordance
with generally accepted accounting principles applied on a consistent
basis throughout the periods presented, except as may be stated
therein. The selected and summary financial and statistical data
included in the Registration Statement and the Prospectus
Supplement/Prospectus present fairly (or, if the Prospectus
Supplement/Prospectus has not been filed with the Commission, as to the
Prospectus Supplement/Prospectus, will present fairly) the information
shown therein and have been compiled on a basis consistent with the
audited financial statements presented therein. No other financial
statements or schedules are required to be included in the Registration
Statement, the Base Prospectus, the Preliminary Prospectus
Supplement/Prospectus or the Prospectus Supplement/Prospectus.
(q) The books, records and accounts of the Company accurately
and fairly reflect, in reasonable detail, the transactions in and
dispositions of the assets of the Company. The systems of internal
accounting controls maintained by the Company are 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 (x) to permit preparation of financial
statements in conformity with generally accepted accounting principles
and (y) 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 the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(r) The Company has delivered to the Representative the
written agreement of each of its officers and directors (each a
"Material Holder") to the effect that each Material Holder will not,
for a period of 90 days following the date of this Agreement, without
the prior written consent of First Security Xxx Xxxxxx Inc., offer,
sell or
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otherwise dispose of any Common Stock owned by him or her or any
interest therein, except for bona fide gifts and transfers of Common
Stock to immediate family members or to a trust for his or her benefit
or the benefit of an immediate family member.
(s) No labor disturbance by the employees of the Company
exists, is imminent or, to the knowledge of the Company, is
contemplated or threatened. The Company is not aware of an existing,
imminent or threatened labor disturbance by employees of any principal
suppliers, manufacturers, contractors or others that might be expected
to result in any material change in the business, results of
operations, condition (financial or other) or prospects of the Company.
No collective bargaining agreement exists with any of the Company's
employees and, to the best knowledge of the Company, no such agreement
is imminent.
(t) The Company has filed all federal, state, local and
foreign tax returns which are required to be filed or has requested
extensions thereof and has paid all taxes, including withholding taxes,
penalties and interest, assessments, fees and other charges to the
extent that those taxes have become due and payable. No tax assessment
or deficiency has been made or proposed against the Company nor has the
Company received any notice of any proposed tax assessment or
deficiency.
(u) Except as set forth in the Prospectus
Supplement/Prospectus (or, if the Prospectus Supplement/Prospectus is
not in existence, the most recent Preliminary Prospectus
Supplement/Prospectus), there are no outstanding loans, advances or
guaranties of indebtedness by the Company to or for the benefit of any
of (i) its "affiliates", as that term is defined in the Rules and
Regulations, or (ii) any of the members of the families of any of them.
(v) The Company has not, directly or indirectly, at any time:
(i) made any contributions to any candidate for political office, or
failed to disclose fully any such contribution, in violation of law;
(ii) made any payment to any local, state, federal or foreign
governmental officer or official or other person charged with similar
public or quasi-public duties, other than payments required or allowed
by all applicable laws; or (iii) violated any provision of the Foreign
Corrupt Practices Act of 1977, as amended.
(w) The Company has no liability, absolute or contingent,
relating to: (i) public health or safety; (ii) worker health or safety;
(iii) product defect or warranty; or (iv) pollution, damage to or
protection of the environment, including, without limitation, relating
to damage to natural resources, emissions, discharges, releases or
threatened releases of hazardous materials into the environment
(including, further without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or otherwise relating
to the manufacture, processing, use, treatment, storage, generation,
disposal, transport or handling of any hazardous materials. As used in
this Section 2(w), "hazardous material" includes lead, lead oxide,
sulfuric acid, solvents, adhesives and other chemical substances,
wastes, pollutants, contaminants and hazardous or toxic substances,
constituents, materials or wastes, in each case whether solid, gaseous
or liquid in nature.
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(x) The Company has not distributed and will not distribute
prior to the Time of Purchase and the Additional Time of Purchase, as
the case may be, any prospectus, prospectus supplement or other
offering material in connection with the offering and sale of the
Shares other than the Preliminary Prospectus Supplement/Prospectus, the
Prospectus Supplement/Prospectus, the Registration Statement and any
other material which may be permitted by the Securities Act and the
Rules and Regulations.
(y) The Common Stock is traded on and, subject to official
notice of issuance, the Shares have been approved for inclusion for
quotation on the Nasdaq National Market.
(z) The Company is not now, and intends to conduct its affairs
in the future in such a manner so that it will not become, an
investment company within the meaning of the Investment Company Act of
1940, as amended.
2. Purchase, Sale and Delivery of Shares.
(a) On the basis of the representations, warranties, covenants and
agreements of the Company contained in this Agreement and subject to the terms
and conditions set forth in this Agreement, the Company agrees to sell to the
several Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at a purchase price of $8.46 per share
(the "purchase price per share"), the number of Firm Shares set forth opposite
its name on Schedule I hereto.
(b) The Company hereby grants to the several Underwriters an option to
purchase from the Company, severally and not jointly, all or any portion of the
Option Shares at the same purchase price per share as the Underwriters are to
pay for the Firm Shares. This option may be exercised only to cover
over-allotments in the sale of the Firm Shares by the Underwriters and may be
exercised in whole or in part at any time on or before the 45th day after the
date of the Prospectus Supplement/Prospectus upon written, telecopied or
telegraphic notice by the Representative to the Company setting forth the
aggregate number of Option Shares as to which the several Underwriters are
exercising the option and the settlement date. The Option Shares shall be
purchased severally, and not jointly, by each Underwriter, if purchased at all,
in the same proportion that the number of Firm Shares set forth opposite the
name of the Underwriter in Schedule I to this Agreement bears to the total
number of Firm Shares to be purchased by the Underwriters under Section 2(a)
above, subject to such adjustments as the Representative may in its discretion
make to eliminate any fractional shares. Delivery of certificates for the Option
Shares, and payment therefor, shall be made as provided in Sections 2(c) and
2(d) below.
(c) Delivery of the Firm Shares and, if the option granted by the
Company in Section 2(b) above has been exercised not later than 6:30 a.m., San
Francisco time, on the second business day preceding the Time of Purchase, the
Option Shares is to be made at the office of Xxxxxx, Xxxx & Xxxxxxxx LLP, 0000
Xxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx 00000 at 7:30 a.m., Denver time,
on November 12, 1999, at such time on such other day, not later than seven full
business days after that date, as is agreed to in writing by the Company and the
Representative or as provided in Section 8 of this Agreement. The date and hour
of delivery and
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payment for the Firm Shares is referred to in this Agreement as the "Time of
Purchase". As used in this Agreement, "business day" means a day on which the
Nasdaq National Market is open for trading and on which banks in New York and
California are open for business and not permitted by law or executive order to
be closed.
(d) If the option granted by the Company in Section 2(b) above is
exercised after 6:30 a.m., San Francisco time, on the second business day
preceding the Time of Purchase, delivery of the Option Shares and payment
therefor is to be made at the office of First Security Xxx Xxxxxx Inc., 000
Xxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000, at 6:30 a.m.,
San Francisco time, on the date specified by the Representative, which shall be
four or fewer business days after the exercise of the option, but not in excess
of the period of time specified in the Rules and Regulations (such date and
time, the "Additional Time of Purchase").
(e) Payment of the purchase price for the Shares by the several
Underwriters is to be made by certified or official bank check or checks drawn
in next-day funds, payable to the order of the Company. Such payment shall be
made upon delivery of certificates for the Shares to you for the respective
accounts of the several Underwriters. Certificates for the Shares to be
delivered to you must be registered in such name or names and shall be in such
denominations as the Representative may request no later than the second
business day before the Time of Purchase, in the case of Firm Shares, and at
least one business day prior to the purchase of the Option Shares, in the case
of the Option Shares. Such certificates will be made available to the
Underwriters for inspection, checking and packaging at such location as the
Representative may request, not less than one full business day prior to the
Time of Purchase or, in the case of the Option Shares, by 3:00 p.m., New York
time, on the first business day preceding the Additional Date of Purchase. The
Representative, individually and not on behalf of the Underwriters, may (but is
not be obligated to) make payment to the Company for Shares to be purchased by
any Underwriter whose check or funds has not been received by the Representative
at the Time of Purchase or, if applicable, the Additional Time of Purchase. Any
such payment shall not relieve such Underwriter from any of its obligations
hereunder.
(f) It is understood that the several Underwriters propose to offer the
Shares for sale to the public as soon as the Representative deems it advisable
to do so. The Firm Shares are to be initially offered to the public at the
public offering price set forth (or to be set forth) in the Prospectus
Supplement/Prospectus. The Representative may from time to time thereafter
change the public offering price and other selling terms.
3. Certain Additional Agreements of the Company. The Company covenants
and agrees with the several Underwriters as set forth below:
(a) The Company will file the Prospectus
Supplement/Prospectus, properly completed (and in form and substance
reasonably satisfactory to the Underwriters) pursuant to Rule 424(b)
within the time period prescribed and in any event prior to the Time of
Purchase and will provide evidence satisfactory to the Representative
of that timely filing. The Company will not file the Prospectus
Supplement/Prospectus, any amended Prospectus Supplement/Prospectus,
any amendment (including post-effective amendments) to the Registration
Statement or any supplement to the Prospectus
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Supplement/Prospectus without (i) advising the Representative of and, a
reasonable time prior to the proposed filing of the amendment or
supplement, furnishing the Representative with copies thereof and (ii)
obtaining the prior consent of the Representative to that filing. The
Company will prepare and file with the Commission, promptly upon the
request of the Representative, any amendment to the Registration
Statement or amendment or supplement to the Prospectus
Supplement/Prospectus that may be necessary or advisable in connection
with the distribution of the Shares by the Underwriters and use its
best efforts to cause any such amendment to become effective as
promptly as possible.
(b) The Company will promptly advise the Representative (i)
when any post-effective amendment to the Registration Statement becomes
effective, (ii) of any request by the Commission for any amendment of
or supplement to the Registration Statement or the Prospectus
Supplement/Prospectus or for any additional information, (iii) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose and (iv) of the receipt
by the Company of any notification with respect to the suspension of
the registration, qualification or exemption from registration or
qualification of the Shares for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose. The
Company will use its best efforts to prevent the issuance of any such
stop order or suspension and, if issued, to obtain the withdrawal
thereof as soon as possible.
(c) Until the Time of Purchase and, if applicable, the
Additional Time of Purchase has occurred, the Company will (i) provide
to you, two business days before the filing thereof, a copy of each
document the Company intends to file or files with the Commission that
would be incorporated in the Base Prospectus, (ii) consult with you
concerning each such document and (iii) not file any such document to
which you reasonably object.
(d) The Company will (i) on or before the Time of Purchase,
deliver to you and your counsel a signed copy of the Registration
Statement as originally filed and, promptly upon the filing thereof, a
signed copy of each post-effective amendment, if any, to the
Registration Statement (together with, in each case, all exhibits
thereto unless and to the extent previously furnished to each of you
and your counsel) and all documents filed by the Company with the
Commission under the Exchange Act and deemed to be incorporated by
reference in the Base Prospectus and will also deliver to you, for
distribution to the several Underwriters, a sufficient number of
additional conformed copies of each of the foregoing (excluding
exhibits) so that one copy of each may be distributed to each
Underwriter, (ii) as promptly as possible deliver to each of you and
send to the several Underwriters, at such office or offices as you may
designate, as many copies of the Prospectus Supplement/Prospectus as
you reasonably request and (iii) thereafter from time to time during
the period in which a prospectus is required by law to be delivered by
an Underwriter or a dealer, likewise send to the Underwriters as many
additional copies of the Prospectus Supplement/Prospectus and as many
copies of any supplement to the Prospectus Supplement/Prospectus and of
any amended Prospectus
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Supplement/Prospectus, filed by the Company with the Commission, as you
may reasonably request for the purposes contemplated by the Securities
Act.
(e) If at any time during the period in which a prospectus is
required by law to be delivered by an Underwriter or a dealer any event
occurs as a result of which it is necessary to supplement or amend the
Prospectus Supplement/Prospectus in order to make the Prospectus
Supplement/Prospectus not misleading or so that the Prospectus
Supplement/Prospectus will not omit to state a material fact required
to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading,
in each case at the time the Prospectus Supplement/Prospectus is
delivered to a purchaser of the Shares, or if it is necessary to amend
or to supplement the Prospectus Supplement/Prospectus to comply with
the Securities Act, the Rules and Regulations, the Exchange Act or the
Exchange Act Rules and Regulations, the Company will forthwith prepare
and file with the Commission a supplement to the Prospectus
Supplement/Prospectus or an amended Prospectus Supplement/Prospectus so
that the Prospectus Supplement/Prospectus as so supplemented or amended
will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading and so that it then will otherwise
comply with the Securities Act, the Rules and Regulations, the Exchange
Act and the Exchange Act Rules and Regulations. If, after the public
offering of the Shares by the Underwriters and during such period, the
Underwriters propose to vary the terms of offering thereof by reason of
changes in general market conditions or otherwise, you will advise the
Company in writing of the proposed variation and if, in the opinion
either of counsel for the Company or counsel for the Underwriters, such
proposed variation requires that the Prospectus Supplement/ Prospectus
be supplemented or amended, the Company will forthwith prepare and file
with the Commission a supplement to the Prospectus
Supplement/Prospectus or an amended Prospectus Supplement/Prospectus
setting forth that variation. The Company authorizes the Underwriters
and all dealers to whom any of the Shares may be sold by the
Underwriters to use the Prospectus Supplement/ Prospectus, as from time
to time so amended or supplemented and for the period when a prospectus
is required to be delivered, in connection with the sale of the Shares
in accordance with the applicable provisions of the Securities Act and
the Rules and Regulations.
(f) The Company will cooperate with you and your counsel in
the qualification or registration of the Shares for offer and sale
under the securities or Blue Sky laws of such jurisdictions as you may
designate and, if applicable, in connection with exemptions from such
qualification or registration and, during the period in which a
Prospectus Supplement/Prospectus is required by law to be delivered by
an Underwriter or a dealer, in keeping those qualifications,
registrations and exemptions in effect; provided that the Company is
not obligated to file any general consent to service of process or to
qualify to do business as a foreign corporation in any jurisdiction in
which it is not so qualified. The Company will, from time to time,
prepare and file such statements, reports and other documents as are or
may be required to continue such qualifications, registrations and
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exemptions in effect for so long a period as you may reasonably request
for the distribution of the Shares.
(g) During a period of five years commencing with the date of
this Agreement, the Company will promptly furnish to you and to each
Underwriter who may so request in writing copies of (i) all periodic
and special reports furnished by it to its shareholders, (ii) all
information, documents and reports filed by it with the Commission, the
Nasdaq National Market, any securities exchange or the National
Association of Securities Dealers, Inc., (iii) all press releases and
material news items or articles in respect of the Company, its products
or affairs released or prepared by the Company (other than promotional
and marketing materials disseminated solely to customers and potential
customers of the Company in the ordinary course of business) and (iv)
any additional information concerning the Company or its business which
the Representative reasonably requests.
(h) As soon as practicable, but not later than the 45th day
following the end of the fiscal quarter first ending after the first
anniversary of the Effective Date, the Company will make generally
available to its securities holders and furnish to the Representative
an earning statement or statements in accordance with Section 11(a) of
the Securities Act and Rule 158.
(i) Without the prior written consent of First Security Xxx
Xxxxxx Inc., the Company will not, directly or indirectly, offer, sell,
grant options to purchase or otherwise dispose of any shares of its
equity securities for 90 days following the date of this Agreement,
except that no consent is required (i) for the sale of the Shares to be
sold to the Underwriters pursuant to this Agreement and the warrants to
be sold pursuant to the Warrant Agreement, (ii) with respect to
securities issued in connection with any acquisitions, (iii) for grant
and exercises of stock options under stock option plans existing at the
date of this Agreement or options that are exercisable after that
90-day period, (iv) issuances of Common Stock on exercise of warrants
and conversion of convertible securities, in each case as are
outstanding at the date of this Agreement, and (v) issuances of Common
Stock under the Company's employee compensation plans in existence at
the date of this Agreement.
(j) The Company will apply the net proceeds from the offering
received by it in the manner set forth under the caption "Use of
Proceeds" in the Prospectus Supplement/ Prospectus.
(k) As long as the Common Stock is publicly held, the Company
will use its best efforts to, and at all times for a period of at least
five years after the date of this Agreement, unless such securities are
then listed on a national securities exchange, cause the Common Stock
(including the Shares) to be included for quotation on the Nasdaq
National Market, and the Company will comply with all registration,
filing, reporting and other requirements of the Exchange Act and the
Nasdaq National Market (or, if applicable, such national securities
exchange) which may from time to time be applicable to the Company.
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(l) The Company will timely, and in any event prior to the
Time of Purchase, file this Agreement with the Commission with a Report
on Form 8-K.
(m) The Company will as soon as possible, and in any event
prior to the Time of Purchase, amend the Rights Agreement to clarify
that neither any Underwriter nor any two or more Underwriters taken
together have been or will be the "Beneficial Owner" and/or
"beneficially own", in each case as defined in the Rights Agreement,
any of (i) the Shares it or they had or have the right to acquire under
the Underwriting Agreement, (ii) the Shares it or they acquire under
the Underwriting Agreement or (iii) any shares of Common Stock it or
they acquire in stabilization transactions related to the distributions
or proposed distribution of the Shares contemplated by the Underwriting
Agreement.
(n) For purposes of the Rights Agreement, the Company consents
to the acquisition of shares of Common Stock by the Representative and
the Underwriters pursuant to this Agreement, the Warrant Agreement and
any other acquisitions made prior to the date of the amendment to the
Rights Agreement described in Section 3(m) above.
4. Fees and Expenses.
(a) The Company will pay and bear all costs and expenses in connection
with: the preparation, printing and filing of the Registration Statement
(including financial statements, schedules and exhibits), Preliminary Prospectus
Supplement/Prospectus and the Prospectus Supplement/Prospectus, any drafts of
each of them and any amendments or supplements to any of them; the duplication
or, if applicable, printing (including all drafts thereof) of this Agreement,
the Agreement Among Underwriters, any Selected Dealer Agreements, the Warrant
Agreement, any Preliminary Blue Sky Survey or Memorandum and any Supplemental
Blue Sky Survey or Memorandum, the Underwriters' Questionnaire and the Power of
Attorney and the duplication and printing (including of drafts thereof) of any
other underwriting documents and material (including but not limited to
marketing memoranda and other marketing material) in connection with the
offering, purchase, sale and delivery of the Shares; the issuance and delivery
of the Shares under this Agreement to the several Underwriters, including all
expenses, taxes, duties, fees and commissions on the purchase and sale of the
Shares and Nasdaq National Market brokerage and transaction levies with respect
to the purchase and, if applicable, incident to the sale and delivery of the
Shares by the Company to the several Underwriters and by the several
Underwriters to the initial purchasers thereof; the cost of printing all stock
certificates; the Transfer Agents' and Registrars' fees; the fees and
disbursements of counsel for the Company; all fees and other charges of the
Company's independent public accountants; the cost of furnishing to the several
Underwriters copies of the Registration Statement (including appropriate
exhibits), Preliminary Prospectus Supplement/Prospectus and the Prospectus
Supplement/Prospectus, the agreements and other documents and instruments
referred to above and any amendments or supplements to any of the foregoing;
NASD filing fees and the cost of qualifying or registering the Shares (or
obtaining exemptions from qualification or registration) under the securities or
Blue Sky laws of such jurisdictions as you designate (including filing fees and
the fees and costs/charges of Underwriters' counsel in connection with such
state securities or Blue Sky qualifications, registrations and exemptions); all
fees and expenses in connection
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with qualification of the Shares for inclusion for quotation on the Nasdaq
National Market; advertising and road-show expenses; and all other expenses
incurred by the Company in connection with the performance of its obligations
under this Agreement.
(b) In addition to the Company's obligations under Section 7(a) of this
Agreement, as an interim measure during the pendency of any claim, action,
investigation, inquiry or other proceeding arising out of or, based upon any
loss, claim, damage or liability referred to in Section 7(a) of this Agreement,
the Company must reimburse or advance to or for the benefit of each of the
Underwriters, on a monthly basis (or more often, if requested), for all legal
and other expenses incurred in connection with investigating or defending any
such claim, action, investigation, inquiry or other proceeding, notwithstanding
the absence of a judicial determination as to the propriety and enforceability
of the Company's obligation to reimburse or advance for the benefit of the
Underwriters for such expenses or the possibility that such payments might later
be held to have been improper by a court of competent jurisdiction. To the
extent that any portion, or all, of any such interim reimbursement payments or
advances are so held to have been improper, the Underwriters receiving the same
must severally, and not jointly, promptly return such amounts to the Company
together with interest at the prime rate (or other commercial lending rate for
borrowers of the highest credit standing) announced from time to time by Bank of
America, NT&SA, San Francisco, California (the "Prime Rate"), compounded
monthly, but not in excess of the maximum rate permitted by applicable law. Any
such interim reimbursement payments or advances that are not made to or for the
Underwriters within ten days of a request for reimbursement or for an advance
will bear interest at the Prime Rate, but not in excess of the maximum rate
permitted by applicable law, from the date of such request until the date paid.
(c) In addition to its obligations under Section 7(b) of this
Agreement, each Underwriter severally and in proportion to its obligation to
purchase Firm Shares as set forth on Schedule I hereto, as an interim measure
during the pendency of any claim, action, investigation, inquiry or other
proceeding arising out of or based upon any loss, claim, damage or liability
referred to in Section 7(b) of this Agreement, must reimburse or advance to or
for the benefit of the Company, on a monthly basis (or more often, if
requested), for its proportion share (as so determined) of all legal and other
expenses incurred by the Company in connection with investigating or defending
any such claim, action, investigation, inquiry or other proceeding,
notwithstanding the absence of a judicial determination as to the propriety or
enforceability of the Underwriters' obligation to reimburse or advance for the
benefit of the Company for such expenses and the possibility that such payments
or advances might later be held to have been improper by a court of competent
jurisdiction. To the extent that any portion, or all, of any such interim
reimbursement payments or advances are so held to have been improper, the
Company must promptly return such amounts to each Underwriter in question
together with interest at the Prime Rate, but not in excess of the maximum rate
permitted by applicable law. Any such interim reimbursement payments or advances
that are not made to the Company within ten days of a request for reimbursement
or for an advance will bear interest at the Prime Rate, but not in excess of the
maximum rate permitted by applicable law, from the date of such request until
the date paid.
(d) Any controversy arising out of the operation of the interim
reimbursement and advance arrangements set forth in Sections 4(b) and 4(c)
above, including the amounts of any
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requested reimbursement payments or advance, the method of determining such
amounts and the basis on which such amounts are to be apportioned among the
indemnifying parties, will be settled by arbitration conducted under the
provisions of the Constitution and Rules of the Board of Governors of the New
York Stock Exchange, Inc. or pursuant to the Code of Arbitration Procedure of
the NASD. Any such arbitration must be commenced by service of a written demand
for arbitration or a written notice of intention to arbitrate, therein electing
the arbitration tribunal. If the party demanding arbitration does not make a
designation of an arbitration tribunal in the demand or notice, then the party
responding to the demand or notice is authorized to do so. Any such arbitration
will be limited to the interpretation and obligations of the parties under the
interim reimbursement and advance provisions contained in Sections 4(b) and 4(c)
above and will not resolve the ultimate propriety or enforceability of the
obligation to indemnify for or contribute to expenses that is created by the
provisions of Section 7 of this Agreement.
(e) If the sale of the Shares provided for herein is not completed
because any condition to the obligations of the Underwriters set forth in
Section 5 of this Agreement is not satisfied, because of any termination
pursuant to Section 9 of this Agreement, by the Company under Section 6 of this
Agreement or because of any refusal, inability or failure on the part of the
Company to perform any covenant or agreement set forth in this Agreement or to
comply with any provision of this Agreement other than by reason of a default by
any of the Underwriters, the Company must reimburse the several Underwriters
immediately upon, and in any event within two business days of, demand for all
out-of-pocket expenses (including fees and costs/charges of counsel) that have
been incurred by any or all of them in connection with investigating, preparing
to market or marketing the Shares, including without limitation in connection
with the Preliminary Prospectus Supplement/Prospectus and the Prospectus
Supplement/Prospectus, or otherwise in connection with or related to this
Agreement. Any amount payable by Company under this Section 4(e) that is not
paid when due will bear interest at the Prime Rate, but not in excess of the
maximum amount permitted by law, until paid.
5. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters to purchase and pay for the Shares is subject, in the sole
discretion of the Representative, to the accuracy as of the date of execution of
this Agreement, the Time of Purchase and the Additional Time of Purchase, as the
case may be, of the representations and warranties of the Company set forth in
this Agreement, the accuracy of the statements of the Company and its officers
made in any certificate delivered pursuant to this Agreement, the performance by
the Company of all of its obligations to be performed under this Agreement at or
prior to the Time of Purchase or the Additional Time of Purchase, as the case
may be, the satisfaction of all conditions to be satisfied or performed by the
Company at or prior to the applicable date and the following additional
conditions:
(a) If a post-effective amendment to the Registration
Statement is required to be filed pursuant to Rule 430A under the
Securities Act, that post-effective amendment must have been filed and,
not later than 5:00 p.m., New York time, on the date of this Agreement
or at such later date and time as you may approve in writing, the
Company must have provided evidence satisfactory to the Representative
of the filing and the effectiveness of that amendment, and at the Time
of Purchase and, if applicable, the Additional Time of Purchase, if
filing of the Prospectus Supplement/Prospectus, or any
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supplement thereto, is required pursuant to Rule 424(b), the Prospectus
Supplement/Prospectus, and any supplement thereto, will be filed in the
manner and within the time period required by Rule 424(b) and prior to
the Time of Purchase or Additional Time of Purchase, as the case may
be; no stop order suspending the effectiveness of the Registration
Statement or any qualification, registration or exemption from
qualification or registration for the sale of the Shares in any
jurisdiction may have been issued and no proceedings for that purpose
may have been instituted or threatened; and any request for additional
information on the part of the Commission must have been complied with
to the reasonable satisfaction of the Representative and its counsel.
(b) You must have received from Xxxxxx, Xxxx & Xxxxxxxx LLP,
counsel for the Underwriters, an opinion, dated the day of the Time of
Purchase, with respect to the issuance and sale of the Shares and such
other related matters as the Representative reasonably requires, and
the Company must have furnished such counsel with all documents it
requests for the purpose of enabling them to pass upon those matters.
(c) You must have received at the Time of Purchase and the
Additional Time of Purchase, as the case may be, the opinion of Xxxxxx
Godward LLP, counsel for the Company, addressed to the Underwriters and
dated the day of the Time of Purchase or of the Additional Time of
Purchase, as applicable, with reproduced copies or signed counterparts
thereof for each of the Underwriters, covering the matters set forth in
Annex A to this Agreement and in form and substance satisfactory to
you.
(d) You must be satisfied in your sole judgment that there has
not been any material change in the market for securities in general or
in political, financial or economic conditions as to render it
impracticable in your sole judgment to make a public offering of the
Shares, or a material adverse change in market levels for securities in
general (or those of companies in particular) or financial or economic
conditions which render it inadvisable to proceed.
(e) You must have received at the Time of Purchase and the
Additional Time of Purchase, as the case may be, a certificate, dated
the day of the Time of Purchase or of the Additional Time of Purchase,
as the case may be, and signed by the Chief Executive Officer and the
Chief Financial Officer of the Company stating that:
(i) the representations and warranties of the Company set
forth in Section 1 of this Agreement are true and
correct with the same force and effect as if made at
and as of the Time of Purchase or the Additional Time
of Purchase, as applicable, and the Company has
complied with all the agreements and satisfied all
the conditions on its part to be performed or
satisfied at or prior to the Time of Purchase and the
Additional Time of Purchase, as applicable;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued, and no
proceedings for that purpose have been instituted
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or are pending or, to the knowledge of such persons,
threatened under the Securities Act; and
(iii) (A) each person signing the certificate has carefully
examined the Registration Statement in the form in
which it originally became effective and the
Prospectus Supplement/Prospectus and any supplements
or amendments to any of them and, as of the date of
this Agreement, the statements made in the
Registration Statement, the Preliminary Prospectus
Supplement/Prospectus and the Prospectus
Supplement/Prospectus were true and correct in all
material respects and neither the Registration
Statement nor the Prospectus Supplement/Prospectus
contained a misstatement of a material fact or
omitted to state any material fact required to be
stated therein or necessary in order to make the
statements therein, in light of the circumstances
under which they were made, not misleading, (B) since
the date of this Agreement, no event has occurred
that should have been set forth in an amendment to
the Registration Statement or a supplement or
amendment to the Preliminary Prospectus
Supplement/Prospectus or the Prospectus Supplement/
Prospectus that has not been set forth in such an
amendment or supplement, (C) since the respective
dates as of which information is given in the
Registration Statement in the form in which it
originally became effective, the Base Prospectus and
the Prospectus Supplement/ Prospectus, there has not
been any material change or any development involving
a prospective material change in or affecting the
business, results of operations, condition (financial
or other) or prospects of the Company, whether or not
arising from transactions in the ordinary course of
business, and, since such dates, the Company has not
entered into any material transaction not referred to
in the Registration Statement in the form in which it
originally became effective, the Base Prospectus or
the Prospectus Supplement/ Prospectus, (D) there are
not any pending or, to the knowledge of each person
signing the certificate, threatened legal proceedings
to which the Company is a party or of which property
of the Company is subject which is material and which
is not disclosed in the Prospectus
Supplement/Prospectus and (E) there are not any
license agreements, contracts, leases or other
documents that are required to be filed as exhibits
to the Registration Statement that have not been
filed as required.
(f) You must have received from Xxxxxx Xxxxxxxx LLP a letter
or letters, addressed to the Underwriters and dated the Time of
Purchase and the Additional Time of Purchase, as applicable, confirming
that they are independent accountants with respect to the Company
within the meaning of the Securities Act and the applicable published
Rules and Regulations thereunder and, based upon the procedures
described in their letter, referred to below, delivered to you
concurrently with the execution of this Agreement (the "Original
Letter"), but carried out to a date not more than five business days
prior to the Time of Purchase and the Additional Time of Purchase, as
applicable, (i) confirming, to the extent true, that the statements and
conclusions set forth in the Original Letter are
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accurate as of the day of the Time of Purchase or of the Additional
Time of Purchase, as the case may be, (ii) setting forth any revisions
and additions to the statements and conclusions set forth in the
Original Letter that are necessary to reflect any changes in the facts
described in the Original Letter since the date of the Original Letter
or to reflect the availability of more recent financial statements,
data or information and (iii) if prior to the Time of Purchase or the
Additional Time of Purchase, as applicable, the documents incorporated
in the Base Prospectus include financial statements of the Company for
the quarter ended September 30, 1999 or other financial data not so
incorporated at the date of the Prospectus Supplement/Prospectus (or,
if the Prospectus Supplement/Prospectus is not in existence at the date
of this Agreement, the most recent Preliminary Prospectus
Supplement/Prospectus), a letter reasonably satisfactory to you in form
and content with respect to (x) such financial statements, with the
procedures provided in Statement of Auditing Standards No. 71 having
been performed, and (y) such other financial data with procedures with
respect thereto acceptable to you having been performed. Such letters
must not disclose any change, or any development involving a
prospective change, in or affecting the business, results of
operations, or condition (financial or other) or prospects of the
Company which, in your sole judgment, makes it impractical or
inadvisable to proceed with the public offering of the Shares or the
purchase of the Option Shares as contemplated by the Prospectus
Supplement/Prospectus (or, if the Prospectus Supplement/Prospectus is
not in existence, the most recent Preliminary Prospectus
Supplement/Prospectus).
(g) Prior to the Time of Purchase, the Shares must have been
approved for inclusion for quotation on the Nasdaq National Market
subject to official notice of issuance.
(h) On or prior to the Time of Purchase, you must have
received from all Material Holders executed agreements covering the
matters described in Section 1(r) of this Agreement.
(i) On or prior to the Time of Purchase, the Company must have
entered into the Warrant Agreement, in form satisfactory to the
Representative; and at the Time of Purchase, concurrently with the
purchase and sale of the Firm Shares, the Company must have issued,
sold and delivered the Warrants to the Representative.
(j) The Company must have furnished to you such further
certificates and documents as you reasonably request (including
certificates of officers of the Company), as to the accuracy of the
representations and warranties of the Company set forth in this
Agreement, the performance by the Company of its obligations under this
Agreement and the other conditions concurrent and precedent to the
obligations of the Underwriters under this Agreement.
All the agreements, opinions, certificates and letters mentioned above
or elsewhere in this Agreement will be in compliance with the provisions of this
Agreement only if they are reasonably satisfactory to the Representative and its
counsel. The Company must furnish you
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with such number of conformed copies of such opinions, certificates, letters and
documents as you reasonably request.
If any of the conditions specified in this Section 5 have not been
fulfilled in all material respects when and as provided in this Agreement, time
being of the essence, or if any of the opinions and certificates mentioned above
or elsewhere in this Agreement are not in all material respects reasonably
satisfactory in form and substance to the Representative and its counsel, this
Agreement and all obligations of the Underwriters hereunder may be canceled by
the Representative at, or at any time prior to, the Time of Purchase or, with
respect to the Option Shares, the Additional Time of Purchase, as the case may
be. Notice of such cancellation must be given to the Company in writing or by
telephone, telecopy or telegraph confirmed in writing. Any such termination
shall be without liability of the Company to the Underwriters (except as
provided in Section 4 or Section 7 of this Agreement) and without liability of
the Underwriters to the Company (except to the extent provided in Section 7 of
this Agreement).
6. Conditions of the Obligation of the Company. The obligations of the
Company to sell and deliver the Shares required to be delivered as and when
specified in this Agreement are subject to the condition that, at the Time of
Purchase or, with respect to the Option Shares, the Additional Date of Purchase,
no stop order suspending the effectiveness of the Registration Statement is in
effect and no proceedings therefor are pending or threatened by the Commission.
7. Indemnification and Contribution.
(a) The Company must indemnify and hold harmless each Underwriter and
each person (including each partner or officer thereof) who controls any
Underwriter within the meaning of Section 15 of the Securities Act from and
against any and all losses, claims, damages or liabilities, joint or several, to
which such indemnified persons or any of them may become subject under the
Securities Act, the Rules and Regulations, the Exchange Act, the Exchange Act
Rules and Regulations or other federal or state statute, law or regulation, at
common law or otherwise, specifically including but not limited to losses,
claims, damages or liabilities (or actions in respect thereof) related to
negligence on the part of any Underwriter, and the Company agrees to reimburse
each such Underwriter and controlling person for any legal or other expenses
(including, except as otherwise provided below, settlement expenses and fees and
costs/charges of counsel) incurred by the respective indemnified persons in
connection with defending against any such losses, claims, damages or
liabilities or in connection with any investigation or inquiry of, or other
proceeding that may be brought against, such respective indemnified persons, in
each case insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon, in whole or in part, (i) any
breach of any representation, warranty, covenant or agreement of the Company in
this Agreement, (ii) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement (including in the Base
Prospectus and the documents incorporated or to be incorporated by reference
therein) or any post-effective amendment thereto, or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, (iii) any untrue statement or alleged
untrue statement of a material fact contained in the Preliminary Prospectus
Supplement/Prospectus or the Prospectus Supplement/Prospectus, including in the
documents incorporate or
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to be incorporated in the Base Prospectus (in each case as amended or as
supplemented if the Company has filed with the Commission any amendment thereof
or supplement thereto) or the omission or alleged omission to state therein 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 or (iv) any untrue statement or alleged untrue statement of a
material fact contained in any application or other document, or any amendment
or supplement thereto, executed by the Company or based upon written information
furnished by or on behalf of the Company filed in any jurisdiction in order to
qualify or register the Shares under the securities or Blue Sky laws thereof or
to obtain an exemption from such qualification or registration or filed with the
Commission (except to the extent covered by clause (ii) and (iii) of this
sentence) or any securities association, the Nasdaq National Market or any
securities exchange, or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided that (A) the indemnity agreements of the Company contained
in this Section 7(a) will not apply to any such losses, claims, damages,
liabilities or expenses if such statement or omission was made in reliance upon
and in conformity with information furnished in writing to the Company by or on
behalf of any Underwriter through the Representative specifically for use in the
Registration Statement, the Preliminary Prospectus Supplement/Prospectus or the
Prospectus Supplement/Prospectus or any such amendment thereof or supplement
thereto and (B) the indemnity agreement contained in this Section 7(a) with
respect to any Preliminary Prospectus Supplement/Prospectus will not inure to
the benefit of any Underwriter from whom the person asserting any such losses,
claims, damages, liabilities or expenses purchased the Shares that are the
subject thereof (or to the benefit of any person controlling such Underwriter)
if the Company demonstrates that at or prior to the written confirmation of the
sale of such Shares a copy of the Prospectus Supplement/Prospectus (or the
Prospectus Supplement/ Prospectus as amended or supplemented) (excluding the
documents incorporated therein by reference) was not sent or delivered to such
person and the untrue statement or omission of a material fact contained in such
Preliminary Prospectus Supplement/Prospectus was corrected in the Prospectus
Supplement/Prospectus (or the Prospectus Supplement/Prospectus as amended or
supplemented), unless the failure is the result of noncompliance by the Company
with Section 3 of this Agreement. The indemnity agreements of the Company
contained in this Section 7(a) and the representations and warranties of the
Company contained in Section 1 of this Agreement will remain operative and in
full force and effect regardless of any investigation made by or on behalf of
any person indemnified by this Section 7(a) and will survive the delivery of and
payment for the Shares. This indemnity agreement is in addition to any
liabilities which the Company may otherwise have.
(b) Each Underwriter, severally and not jointly, agrees to indemnify
and hold harmless the Company, each of its officers who signed the Registration
Statement, each of its directors, each other Underwriter and each person
(including each partner or officer thereof) who controls the Company or any such
other Underwriter within the meaning of Section 15 of the Securities Act from
and against any and all losses, claims, damages or liabilities, joint or
several, to which such indemnified persons or any of them may become subject
under the Securities Act, the Rules and Regulations, the Exchange Act, the
Exchange Act Rules and Regulations or other federal or state statute, law or
regulation or at common law or otherwise and to reimburse each of them for
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any legal or other expenses (including, except as otherwise provided below,
settlement expenses and fees and costs/charges of counsel) incurred by the
respective indemnified persons in connection with defending against any such
losses, claims, damages or liabilities or in connection with any investigation
or inquiry of, or other proceeding that may be brought against, the respective
indemnified persons, in each case arising out of or based upon (i) any breach of
any representation, warranty, covenant or agreement of the indemnifying
Underwriter in this Agreement, (ii) any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement (including
the Base Prospectus) or any post-effective amendment thereto, or the omission or
alleged omission to state therein 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 or (iii) any untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Prospectus Supplement/Prospectus or the Prospectus Supplement/Prospectus (as
amended or as supplemented if the Company has filed with the Commission any
amendment thereof or supplement thereto) or the omission or alleged omission to
state therein 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, but in each case under clauses (ii) and (iii) above, as
the case may be, only if such statement or omission was made in reliance upon
and in conformity with information furnished in writing by or on behalf of such
indemnifying Underwriter through the Representative specifically for use in the
Registration Statement, any Preliminary Prospectus Supplement/Prospectus or the
Prospectus Supplement/Prospectus or any such amendment thereof or supplement
thereto. The Company acknowledges and agrees that the information set forth in
the last paragraph on the cover of the Preliminary Prospectus
Supplement/Prospectus and in the table under the caption "Underwriting" listing
the Underwriters and the number of Firm Shares to be purchased by each, the
paragraph following that table, and the final paragraph under the caption
"Underwriting" in the Prospectus Supplement/ Prospectus (or, if the Prospectus
Supplement/ Prospectus is not in existence, to be included therein if identical
to the comparable information in the Preliminary Prospectus
Supplement/Prospectus except for changes approved by the Representative)
constitute the only information furnished by the Underwriters to the Company for
inclusion in any Preliminary Prospectus Supplement/Prospectus, the Prospectus
Supplement/Prospectus or the Registration Statement. The indemnity agreement of
each Underwriter contained in this Section 7(b) will remain operative and in
full force and effect regardless of any investigation made by or on behalf of
any person indemnified by this Section 7(b) and will survive the delivery of and
payment for the Shares. This indemnity agreement shall be in addition to any
liabilities which each Underwriter may otherwise have.
(c) Each person indemnified by Sections 7(a) and 7(b) above agrees,
upon the service of a summons or other initial legal process upon it in any
action or suit instituted against it or upon its receipt of written notification
of the commencement of any investigation or inquiry of, or proceeding against,
it in respect of which indemnity may be sought and if a claim in respect
thereunder is to be made against the indemnifying persons under this Section 7,
to promptly give written notice (the "Notice") of the service or notification to
the person from whom indemnification may be sought under this Agreement. No
indemnification under Sections 7(a) or 7(b) above or, contribution under Section
7(e) below, will be available to any person who fails to so give the Notice if
the person to whom the Notice was not given was unaware of the action,
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suit, investigation, inquiry or proceeding to which the Notice would have
related, but only to the extent that person demonstrates it was materially
prejudiced by the failure to receive the Notice, and the omission so to notify
the indemnifying person will not relieve it or any other person from any
liability which either may have to the indemnified person or persons other than
under Sections 7(a), 7(b) or 7(e).
(d) Any indemnifying person will be entitled at its own expense to
participate in the defense of any action, suit or proceeding against, or
investigation or inquiry of, an indemnified person. Any indemnifying person will
be entitled, if it so elects within a reasonable time after receipt of the
Notice by giving written notice (the "Notice of Defense") to the indemnified
person, to assume (alone or in conjunction with any other indemnifying person or
persons) the entire defense of the action, suit, investigation, inquiry or
proceeding, in which event the defense will be conducted, at the expense of the
indemnifying person or persons, by counsel chosen by such indemnifying person or
persons and reasonably satisfactory to the indemnified person or persons;
provided that if the indemnified person or persons reasonably determine that
there may be a conflict between the positions of the indemnifying person or
persons and the indemnified person or persons in conducting the defense of the
action, suit, investigation, inquiry or proceeding or that there may be legal
defenses or rights available to the indemnified person or persons different from
or in addition to those available to the indemnifying person or persons, then
separate counsel for and selected by the indemnified person or persons will be
entitled to conduct the defense of the indemnified person or persons at the
expense of the indemnifying person or persons; and provided further that the
indemnifying person or persons will not be liable for the fees and expenses of
more than one separate counsel, reasonably approved by the indemnifying person
or persons, for all of the indemnified persons, plus, if applicable, local
counsel in each jurisdiction. In addition, in any event, the indemnified person
or persons will be entitled to have counsel selected by such indemnified person
or persons participate in, but not conduct, the defense. If, within a reasonable
time after receipt of the Notice, an indemnifying person gives a Notice of
Defense and, unless separate counsel is to be chosen by the indemnified person
or persons as provided above or the counsel chosen by the indemnifying person or
persons is not reasonably satisfactory to the indemnified person or persons, the
indemnifying person or persons will not be liable under Sections 7(a) above
through this Section 7(d) for any legal expenses subsequently incurred by the
indemnified person or persons in connection with the defense of the action,
suit, investigation, inquiry or proceeding, except that (A) the indemnifying
persons or person must bear and pay the legal and other expenses incurred in
connection with the conduct of the defense as referred to in the "provided"
clause in the preceding sentence and (B) the indemnifying person or persons must
bear and pay such other expenses as it or they have authorized to be incurred by
the indemnified person or persons. If, within a reasonable time after receipt of
the Notice, no Notice of Defense has been given, the indemnifying person or
persons will be responsible for any legal or other expenses incurred by the
indemnified person or persons in connection with the defense of the action,
suit, investigation, inquiry or proceeding.
(e) In order to provide for just and equitable contribution in any
action in which a claim for indemnification is made pursuant to this Section 7
but is judicially determined (by the entry of a final judgment or decree by a
court of competent jurisdiction and the expiration of time to appeal or the
denial of the last right to appeal) that such indemnification may not be
enforced in the case notwithstanding that this Section 7 provides for
indemnification in that case, each
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indemnifying person must contribute to the amount paid or payable by such
indemnified person as a result of the losses, claims, damages, liabilities and
expenses referred to in Section 7(a) or 7(b) above (i) in such proportion as is
appropriate to reflect the relative benefits received by each indemnifying
person from the offering of the Shares or (ii) if the allocation provided by
clause (i) of this sentence is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in that clause (i) but also the relative fault of each person in connection
with the statements, omissions or other matters that resulted in the losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the
Underwriters will be deemed to be in the same respective proportions as the
total proceeds from the offering of the Shares, net of the underwriting
discounts, received by the Company and the total underwriting discount retained
by the Underwriters bear to the aggregate public offering price of the Shares.
Relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by a
party and the party's relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission.
The parties agree that it would not be just and equitable if
contribution pursuant to this Section 7(e) were to be 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 into account
the considerations referred to in the first paragraph of this Section 7(e). The
amount paid by an indemnified person as a result of the losses, claims, damages
or liabilities, referred to in the first sentence of this Section 7(e) will be
deemed to include any legal or other expenses reasonably incurred by that
indemnified person in connection with investigating, preparing to defend or
defending against any action or claim which is the subject of this Section 7(e).
Notwithstanding the provisions of this Section 7(e), no Underwriter will be
required to contribute any amount in excess of the underwriting discount
applicable to the Shares purchased by that Underwriter. For purposes of this
Section 7(e), each person who controls an Underwriter within the meaning of the
Securities Act will have the same rights to contribution as the Underwriter, and
each person who controls the Company within the meaning of the Securities Act,
each officer of the Company who signed the Registration Statement and each
director of the Company will have the same rights to contribution as the
Company, subject in each case to the immediately preceding sentence and the
immediately following two sentences. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
will be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations to contribute in
this Section 7(e) are several in proportion to their respective underwriting
obligations and not joint.
(f) The Company may not, without the prior written consent of each
Underwriter, settle or compromise or consent to the entry of any judgment in any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought under this Section 7 (whether or
not the Underwriter or any person who controls such Underwriter within the
meaning of Section 15 of the Securities Act is a party to such claim, action,
suit or proceeding), unless the settlement, compromise or consent includes an
unconditional release of each the Underwriter and each such controlling person
from all liability arising out of the claim, action, suit or proceeding.
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(g) No Underwriter may, without the consent of the Company, settle or
compromise or consent to the entry of any judgment in any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the Company is a party to
such claim, action, suit or proceeding), which consent shall not be unreasonably
withheld, unless such settlement, compromise or consent includes an
unconditional release of the Company, each of its officers who signed the
Registration Statement, each of its directors and each person who controls the
Company within the meaning of Section 15 of the Securities Act from all
liability arising out of such claim, action, suit or proceeding.
(h) The parties to this Agreement acknowledge that they are
sophisticated business persons who were represented by counsel during the
negotiations regarding this Agreement including, without limitation, Sections
4(b) and 4(c) of this Agreement and this Section 7 and that they are fully
informed regarding all such provisions. They further acknowledge that Sections
4(b) and 4(c) and this Section 7 fairly allocate the risks in light of the
ability of the parties to investigate the Company and its business in order to
assure that adequate disclosure is made in the Registration Statement, the
Preliminary Prospectus Supplement/Prospectus and the Prospectus
Supplement/Prospectus as required by the Securities Act, the Rules and
Regulations, the Exchange Act and the Exchange Act Rules and Regulations. The
parties are aware that federal or state policy, as interpreted by the courts in
certain jurisdictions, may be contrary to certain provisions of Sections 4(b)
and 4(c) and this Section 7 and, to the extent permitted by law, the parties
hereby expressly waive and relinquish any right or ability to assert that public
policy as a defense to a claim under Sections 4(b) or 4(c) or this Section 7 and
further agree not to attempt to assert any such defense.
(i) As used in this Agreement, the word "persons" includes individuals
and entities and the word "it" includes individuals (including without
limitation corporations, partnerships and limited liability companies).
(j) If any payment required to be made under this Section 7 is not made
within two business days after demand, the amount due will bear interest at the
Prime Rate, compounded monthly, but not in excess of the maximum rate permitted
by applicable law.
8. Substitution of Underwriters. If for any reason one or more of the
Underwriters fails or refuses (otherwise than for a reason sufficient to justify
the termination of this Agreement under Sections 5 or 9 of this Agreement) to
purchase and pay for the number of Firm Shares agreed to be purchased by such
Underwriter or Underwriters, the Company must immediately give notice thereof to
the Representative, in which event the non-defaulting Underwriters will have the
right within 24 hours after the receipt by the Representative of that notice to
purchase, or procure one or more other Underwriters to purchase, in such
proportions as may be agreed between the Representative and such purchasing
Underwriter or Underwriters and upon the terms set forth herein, all or any part
of the Firm Shares that the defaulting Underwriter or Underwriters agreed to
purchase. If the non-defaulting Underwriters fail to make such arrangements with
respect to all such Shares, the number of Firm Shares that each non-defaulting
Underwriter is otherwise obligated to purchase under this Agreement will
automatically be increased on a pro rata basis to absorb the remaining Shares
that the defaulting Underwriter or Underwriters agreed
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to purchase; provided, that the non-defaulting Underwriters will not be
obligated to purchase the Shares that the defaulting Underwriter or Underwriters
agreed to purchase if the aggregate number of such Shares exceeds ten percent of
the total number of Firm Shares. If the total number of Firm Shares that the
defaulting Underwriter or Underwriters agreed to purchase will not be purchased
or absorbed in accordance with the two immediately preceding sentences, the
Company will have the right, within 24 hours next succeeding the first 24-hour
period referred to above, to make arrangements with other underwriters or
purchasers satisfactory to you for purchase of those Shares on the terms set
forth in this Agreement. In any such case, either you or the Company will have
the right to postpone the Time of Purchase determined as provided in Section
2(c) of this Agreement for not more than seven business days after the Time of
Purchase initially fixed pursuant to Section 2(c) in order that any necessary
changes in the Registration Statement, the Preliminary Prospectus
Supplement/Prospectus, the Prospectus Supplement/Prospectus or any other
documents or arrangements may be made.
If neither the non-defaulting Underwriters nor the Company makes
arrangements within the time periods provided in the first three sentences of
the first paragraph of this Section 8 for the purchase of all the Firm Shares
the defaulting Underwriter or Underwriters agreed to purchase, then this
Agreement will be terminated without further act or deed and without any
liability on the part of the Company to any non-defaulting Underwriter (except
as provided in Sections 4 or 7 of this Agreement) and without any liability on
the part of any non-defaulting Underwriter to the Company (except to the extent
provided in Section 7 of this Agreement). Nothing in this Section 8, and no
action taken hereunder, will relieve any defaulting Underwriter from liability,
if any, to the Company or any non-defaulting Underwriter for damages occasioned
by its default under this Agreement. The term "Underwriter" in this Agreement
shall include any persons substituted for an Underwriter under this Section 8.
9. Effective Date of Agreement and Termination. This Agreement will
become effective upon execution and delivery by you and the Company. This
Agreement may be terminated by you in your absolute discretion by giving written
notice to the Company at any time on or prior to the Time of Purchase or, with
respect to the purchase of the Option Shares, on or prior to the Additional Time
of Purchase, as the case may be, if prior to such time any of the following has
occurred or, in your opinion, is likely to occur: (i) after the respective dates
as of which information is given in the Registration Statement and the
Prospectus Supplement/Prospectus (or, if the Prospectus Supplement/Prospectus
is not in existence, the most recent Preliminary Prospectus
Supplement/Prospectus), any material adverse change or development involving a
prospective material adverse change in or affecting particularly the business,
results of operations, condition (financial or other), or prospects of the
Company, whether or not arising in the ordinary course of business, occurs which
would, in your sole judgment, make the offering or the delivery of the Shares
impracticable or inadvisable; (ii) if, on or after the date of this Agreement,
there has been (x) the engagement in hostilities or an escalation of major
hostilities by the United States or the declaration of war or a national
emergency by the United States or (y) any outbreak of hostilities or other
national or international calamity or crisis or change in economic or political
conditions, if the effect of such outbreak, calamity, crisis or change in
economic or political conditions referred to in this clause (ii)(y) on the
financial markets of the United States would, in your sole judgment, make the
offering or delivery of the Shares impracticable or inadvisable; (iii) if there
has been a suspension of trading in securities generally
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or a material adverse decline in value of securities generally on the New York
Stock Exchange, the American Stock Exchange or the Nasdaq National Market or
limitations on prices (other than limitations on hours or numbers of days of
trading) for securities on either such exchange or system; (iv) if there has
been the enactment, publication, decree or other promulgation of any federal or
state statute, regulation, rule or order of, or commencement of any proceeding
or investigation by, any court, legislative body, agency or other governmental
authority which in your sole judgment materially and adversely affects or may
materially and adversely affect the business, results of operations, condition
(financial or other) or prospects of the Company; (v) if there has been the
declaration of a banking moratorium by federal, New York or California state
authorities; (vi) if there has been any action by any federal, state or local
government or agency in respect of its monetary or fiscal affairs which in your
sole judgment has a material adverse effect on the securities markets in the
United States or makes the offering or delivery of the shares impractical or
inadvisable; or (vii) existing international monetary conditions have undergone
a material change which, in your sole judgment, makes the offering or delivery
of the Shares impracticable or inadvisable. If this Agreement is terminated
pursuant to this Section 9, there will be no liability of the Company to the
Underwriters (except pursuant to Section 4 and Section 7 of this Agreement) and
no liability of the Underwriters to the Company (except to the extent provided
in Section 7 of this Agreement).
10. Notices. Except as may otherwise be provided this Agreement, all
communications under this Agreement are to be in writing and mailed, telecopied
or telegraphed or delivered if to (i) the Underwriters or the Representative, to
First Security Xxx Xxxxxx Inc., 000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000, Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000, Attention: Syndicate Manager (telecopier: (415)
954-8335) and (ii) the Company, to it at 0000 Xxxxx Xxxxxxxx Xxxxx, Xxxxxx,
Xxxxxxxx 00000 (telecopier: (000) 000-0000) Attention: President. All notices
given by telecopy or telegraph are to be promptly confirmed by letter.
11. Persons Entitled to the Benefit of this Agreement. This Agreement
will inure to the benefit of (i) the Company and the several Underwriters, (ii)
with respect to Sections 4 and 7 of this Agreement, the several persons (in
addition to the Company and the several Underwriters) indemnified under Sections
4 and 7 and (iii) in each case their respective personal representatives,
successors and assigns. Nothing in this Agreement is intended or may be
construed to give to any other person any legal or equitable remedy or claim
under or in respect of this Agreement. The term "successors and assigns" as
herein used does not include any purchaser, as such, of any of the Shares from
the several Underwriters.
12. General. Notwithstanding any provision of this Agreement to the
contrary, the reimbursement, indemnification and contribution agreements
contained in this Agreement and the representations, warranties, covenants and
agreements in this Agreement will remain in full force and effect regardless of
(a) any termination of this Agreement, (b) any investigation made by or on
behalf of any Underwriter, any controlling person thereof, the Company or the
respective directors or officers of each of them and (c) delivery and payment
for the Shares under this Agreement; provided that if this Agreement is
terminated prior to the Time of Purchase, Sections 3, (g), (h), (i), (j), and
(k) of this Agreement will be of no further force or effect.
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This Agreement may be executed in two or more counterparts, each of
which will constitute an original, but all of which together will constitute one
and the same instrument, and may be delivered by facsimile transmission of
signature and, if applicable, other pages.
THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS, AND NOT THE LAWS PERTAINING TO CHOICE OR CONFLICT OF LAWS, OF THE
STATE OF NEW YORK IN ACCORDANCE WITH AND AS IS SPECIFICALLY PROVIDED FOR IN
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK.
THIS AGREEMENT CONSTITUTES THE ENTIRE AGREEMENT AMONG THE PARTIES WITH
RESPECT TO THE SUBJECT MATTER HEREOF AND SUPERSEDES ANY PRIOR WRITTEN OR ORAL
AND ANY CONTEMPORANEOUS ORAL AGREEMENTS AND ALL NEGOTIATIONS WITH RESPECT
THERETO.
13. Authority of the Representative. In connection with this Agreement,
the Representative will act for and on behalf of the several Underwriters, and
any action taken under this Agreement by the Representative, as representative
of the several Underwriters, will be binding on all the Underwriters.
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If the foregoing correctly sets forth your understanding, please so
indicate by signing in the space provided below for that purpose, whereupon this
letter will constitute a binding agreement among the Company and the several
Underwriters.
Very truly yours,
BOLDER TECHNOLOGIES CORPORATION
By: /s/ Xxxxx Xxxxxx
----------------------------------------
Confirmed as of the date first above
mentioned as an Underwriter and as
Representative of the several Underwriters
and on behalf of the other several
Underwriters named in Schedule I hereto.
FIRST SECURITY XXX XXXXXX INC.
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------
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SCHEDULE I
UNDERWRITERS
Underwriter Number of Firm Shares to be Purchased
----------- -------------------------------------
First Security Xxx Xxxxxx 1,310,000
CIBC Xxxxxxxxxxx Corporation 75,000
Xxxx Xxxxxxxx Xxxxxxx 75,000
X.X. Xxxxxxx & Sons, Inc. 75,000
Xxxxxxxxx & Xxxxx LLC 75,000
PaineWebber Incorporated 75,000
X.X. Xxxxx Securities Corporation 75,000
Advest, Inc. 40,000
X.X.Xxxxxxxx & Co. 40,000
L.H. Friend, Weinress, Xxxxxxxx & Xxxxxxx, Inc. 40,000
Hanifen, Imhoff, Inc. 40,000
Xxxx X. Xxxxxxx & Company, Incorporated 40,000
Xxxxxxxxxxx, Pettis, Smith, Polian Inc. 40,000
Xxxxxx Xxxxxx & Company, Inc. 40,000
Xxxxxxx Xxxxxx Xxxxx 40,000
Xxxxxxxxx Securities, Inc. 40,000
Sutro & Company, Incorporated 40,000
Wedbush Xxxxxx Securities Inc. 40,000
----------
Total 2,200,000
=========
I-1
32
ANNEX A
MATTERS TO BE COVERED IN THE OPINION OF COUNSEL FOR THE COMPANY
(i) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of Delaware;
(ii) The Company has the corporate power to own, lease and operate
its properties and to conduct its business as described in the
Prospectus Supplement/Prospectus;
(iii) The Company is duly qualified to do business as a foreign
corporation and is in good standing in all jurisdictions in
the United States, if any, in which the ownership or leasing
of its properties or the conduct of its business requires such
qualification, except where the failure so to qualify would
not have a material adverse effect on the business, results of
operations, condition (financial or other) or prospects of the
Company;
(iv) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Prospectus
Supplement/Prospectus as of the dates stated therein; the
issued and outstanding shares of capital stock of the Company
have been duly and validly authorized and issued, are fully
paid and nonassessable;
(v) The Shares, upon issuance and delivery against payment
therefor in accordance with the Agreement, will be duly
authorized, validly issued, fully paid and nonassessable and,
to the knowledge of such counsel, will not have been issued in
violation of any preemptive right or other rights to subscribe
for or purchase securities;
(vi) The Company has corporate power and authority to enter into
the Agreement and to issue, sell and deliver to the
Underwriters the Shares to be sold by it;
(vii) The Agreement has been duly authorized by all necessary
corporate action on the part of the Company and has been duly
executed and delivered by the Company and, assuming its due
authorization, execution and delivery by you, is the valid and
binding agreement of the Company, enforceable against the
Company in accordance with its terms, except insofar as the
indemnification and contribution provisions of the Agreement
may be limited by public policy concerns and except insofar as
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting
creditors' rights generally or by general equitable
principles;
(viii) The Registration Statement has become effective under the
Securities Act and, to the knowledge of such counsel, no stop
order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose
have been instituted or are pending or threatened under the
Securities Act;
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(ix) The Registration Statement and the Prospectus
Supplement/Prospectus (including in each case the Base
Prospectus and the documents incorporated by reference
therein), and each amendment thereof or supplement thereto
(other than the financial statements and schedules and related
notes included therein, as to which such counsel need express
no opinion), as of the effective date of the Registration
Statement and the date of the Prospectus
Supplement/Prospectus, complied as to form in all material
respects with the requirements of the Securities Act, the
Rules and Regulations, the Exchange Act and the Exchange Act
Rules and Regulations;
(x) The terms and provisions of the capital stock of the Company
(including the Rights) conform in all material respects to the
description thereof contained in the Registration Statement
and Prospectus Supplement/Prospectus, the information in the
Prospectus Supplement/Prospectus under the captions
"Description of Common Stock" and "Description of Preferred
Stock" to the extent they constitute matters of law or legal
conclusions, has been reviewed by such counsel and is correct
and the forms of certificates evidencing the Common Stock
comply with Delaware law;
(xi) The description in the Registration Statement and the
Prospectus Supplement/Prospectus (including in each case the
Base Prospectus and the documents incorporated by reference
therein) of the Certificate of Incorporation and bylaws of the
Company and of statutes and contracts are accurate in all
material respects and fairly present in all material respects
the information required to be presented by the Securities
Act, the Rules and Regulations, the Exchange Act and the
Exchange Act Rules and Regulations;
(xii) To the knowledge of such counsel, there are no agreements,
contracts, licenses, leases or documents of a character
required to be described or referred to in the Registration
Statement or Prospectus Supplement/Prospectus or to be filed
as an exhibit to the Registration Statement that are not
described or referred to therein and filed as required;
(xiii) The performance by the Company of its obligations under the
Agreement and the Warrant Agreement and the completion of the
transactions contemplated by each of them will not violate or
result in the breach of or a default under (including without
limitation with the giving of notice, the passage of time or
otherwise) the Company's Certificate of Incorporation, bylaws
or other governing documents or any evidence of indebtedness,
contract, license, joint venture or other agreement or
instrument known to such counsel to which the Company is a
party or by which it or any of its properties are bound, any
law, ordinance, rule or regulation or, to the knowledge of
such counsel, any order, writ, injunction, judgment or decree
of any governmental agency or body or of any court having
jurisdiction over the Company or any of its properties;
provided that no opinion need be rendered concerning state
securities or Blue Sky laws or the Company's indemnification
and contribution obligations under the Agreement and the
Warrant Agreement;
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(xiv) No authorization, approval or consent of any governmental
authority or agency is necessary in connection with the
completion of the transactions contemplated by the Agreement
or the Warrant Agreement, except such as have been obtained
under the Securities Act, are necessary in connection with the
registration of the shares of Common Stock issuable upon
exercise of the Warrants (the "Warrant Shares") or as may be
required under state securities or Blue Sky laws in connection
with the purchase and the distribution of the Shares by the
Underwriters or the registration and sale of the Warrant
Shares;
(xv) To the knowledge of such counsel, there are no legal or
governmental proceedings pending or threatened against the
Company of a character which are required to be disclosed in
the Registration Statement or the Prospectus
Supplement/Prospectus (in each case including the Base
Prospectus and the documents incorporated by reference
therein) by the Securities Act, the Rules and Regulations, the
Exchange Act or the Exchange Act Rules and Regulations, other
than those described therein;
(xvi) To the knowledge of such counsel, no holders of securities
issued by the Company has registration rights, other than
those that have been waived, with respect to the Registration
Statement or the offering and sale of the Shares being made
pursuant to the Registration Statement and the Prospectus
Supplement/Prospectus;
(xvii) Columbine Venture Fund II, L.P. and funds managed by Patricof
& Co. Ventures, Inc. (including its and their Affiliates and
Associates) are not, and have never been, an "Acquiring
Person" under the Rights Agreement.
Under the Rights Agreement, neither any
Underwriter nor any two or more Underwriters taken together
have been or will be the "Beneficial Owner" and/or
"beneficially own", in each case as defined in the Rights
Agreement, any of (i) the Shares it or they had or have the
right to acquire under the Underwriting Agreement, (ii) the
Shares it or they acquire under the Underwriting Agreement or
(iii) any shares of Common Stock it or they acquire in
stabilization transactions related to the distribution or
proposed distribution of the Shares contemplated by the
Underwriting Agreement.
(xviii) The Warrant Agreement has been duly authorized by all
necessary corporate action of the Company and has been duly
executed and delivered by the Company and, assuming due
authorization, execution and delivery by First Security Xxx
Xxxxxx Inc., is the valid and binding agreement of the
Company, enforceable against the Company in accordance with
its terms, except insofar as the indemnification and
contribution provisions of the Warrant Agreement may be
limited by public policy concerns and except as enforceability
may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights
generally or by general equitable principles; and
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(xix) The Warrants have been duly and validly authorized and
constitute valid and binding obligations of the Company
enforceable in accordance with their terms, except as
enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting
creditors' rights generally or by general equitable
principles; the Warrant Shares have been duly and validly
authorized for issuance upon exercise of the Warrants against
payment therefor as provided in the Warrant Agreement
(including, as provided in the Warrant Agreement, by surrender
of Warrants) and, when so issued, will be validly issued,
fully paid and nonassessable; and to the knowledge of such
counsel, no shareholder has any preemptive rights or other
rights to subscribe for or purchase with respect to the
Warrants or the Warrant Shares;
In addition, such counsel shall state that such counsel has in
connection with the preparation of the Registration Statement, and the
Prospectus Supplement/Prospectus, participated in conferences with officers and
representatives of the Company and with its independent public accountants (as
you and your counsel have done). At such conferences such counsel has made
inquiries of such officers, representatives and accountants and discussed the
contents of the Registration Statement and the Prospectus Supplement/Prospectus.
Such counsel has not independently verified and, accordingly does not render any
opinion upon, the accuracy, completeness or fairness of the Registration
Statement and the Prospectus Supplement/Prospectus (except to the extent
provided in paragraph (ix) and paragraph (x). Subject to the foregoing, no facts
have come to such counsel's attention that have caused them to believe that, as
of its effective date, the Registration Statement contained any untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or that, as
of its date or the date hereof, the Prospectus Supplement/Prospectus contained
or contains an untrue statement of a material fact or omitted or omits to state
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading; provided that such counsel need not express any view as to the
financial statements and schedules, related notes, other financial data and
statistical data derived therefrom included in, or incorporated by reference
into, the Registration Statement and the Prospectus Supplement/Prospectus
Counsel rendering the foregoing opinion may rely as to questions of law
not involving the laws of the United States or the State of Colorado on opinions
of local counsel (provided that such counsel states that they believe they and
the Underwriters are justified in relying thereon), may assume that with respect
to the opinion regarding enforceability in paragraphs (vii) and (xviii) that the
laws of New York are identical to the laws of Colorado and, as to questions of
fact, upon representations or certificates of officers of the Company and
government officials, in which case their opinion must to state that they are so
relying thereon and that they have no knowledge of any material misstatement or
inaccuracy in such opinions, representations or certificate. Copies of any
opinion, representation or certificate so relied upon shall be delivered to you,
as Representative of the Underwriters, and to Underwriters' counsel.
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