1
3,450,000 Shares
SECURITY DYNAMICS TECHNOLOGIES, INC.
Common Stock
($.01 Par Value)
UNDERWRITING AGREEMENT
----------------------
________ __, 1997
BT Alex. Xxxxx Incorporated
BancAmerica Xxxxxxxxx Xxxxxxxx
Xxxxx & Company
As Representatives of the
Several Underwriters
c/o BT Alex. Xxxxx Incorporated
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Gentlemen:
Security Dynamics Technologies, Inc., a Delaware corporation (the
"Company"), and certain shareholders of the Company (the "Selling Stockholders")
propose to sell to the several underwriters (the "Underwriters") named in
Schedule I hereto for whom you are acting as representatives (the
"Representatives") an aggregate of 3,000,000 shares of the Company's Common
Stock, $.01 par value (the "Firm Shares"), of which 1,176,000 shares will be
sold by the Company and 1,824,000 shares will be sold by the Selling
Stockholders. The respective amounts of the Firm Shares to be so purchased by
the several Underwriters are set forth opposite their names in Schedule I
hereto, and the respective amounts to be sold by the Selling Stockholders are
set forth opposite their names in Schedule II hereto. The Company and the
Selling Stockholders are sometimes referred to herein collectively as the
"Sellers." The Company also propose to sell at the Underwriters' option an
aggregate of up to 450,000 additional shares of the Company's Common Stock (the
"Option Shares") as set forth below.
As the Representatives, you have advised the Company and the Selling
Stockholders (a) that you are authorized to enter into this Agreement on behalf
of the several Underwriters, and (b) that the several Underwriters are willing,
acting severally and not jointly, to purchase the numbers of Firm Shares set
forth opposite their respective names in Schedule I, plus their pro rata portion
of the Option Shares if you elect to exercise the over-allotment option in whole
or in part for the accounts of the several Underwriters. The
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Firm Shares and the Option Shares (to the extent the aforementioned option is
exercised) are herein collectively called the "Shares."
In consideration of the mutual agreements contained herein and of the
interests of the parties in the transactions contemplated hereby, the parties
hereto agree as follows:
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SELLING STOCKHOLDERS.
(a) The Company represents and warrants to each of the Underwriters as
follows:
(i) A registration statement on Form S-3 (File No. 333-35035) with
respect to the Shares has been carefully prepared by the Company in
conformity with the requirements of the Securities Act of 1933, as amended
(the "Act"), and the Rules and Regulations (the "Rules and Regulations") of
the Securities and Exchange Commission (the "Commission") thereunder and
has been filed with the Commission under the Act. The Company has complied
with the conditions for the use of Form S-3 in connection with the offering
contemplated thereby. Copies of such registration statement, including any
amendments thereto, the preliminary prospectuses (including the prospectus
included in the registration statement at the time it is declared effective
under the Act which meets the requirements of Rule 430A of the Rules and
Regulations) contained therein and the exhibits, financial statements and
schedules, as finally amended and revised, have heretofore been delivered
by the Company to you and, to the extent applicable, were identical to the
electronically transmitted copies thereof filed with the Commission on the
Commission's Electronic Data Gathering, Analysis and Retrieval System
("XXXXX"), except to the extent permitted by Regulation S-T. Such
registration statement, together with any registration statement filed by
the Company pursuant to Rule 462(b) under the Act, herein referred to as
the "Registration Statement," which shall be deemed to include all
information omitted therefrom in reliance upon Rule 430A and contained in
the Prospectus referred to below, has become effective under the Act and no
post-effective amendment to the Registration Statement has been filed as of
the date of this Agreement. The form of prospectus first filed by the
Company with the Commission pursuant to its Rule 424(b) and Rule 430A is
herein referred to as the "Prospectus." Each preliminary prospectus
included in the Registration Statement prior to the time it becomes
effective is herein referred to as a "Preliminary Prospectus."
Any reference herein to the Registration Statement, any Preliminary
Prospectus or the Prospectus shall be deemed to include the documents
incorporated therein by reference, and any supplements or amendments
thereto filed with the Commission after the date of filing of the
Prospectus under Rules 424(b) or 430A and prior to the termination of the
offering of the Shares by the Underwriters. Any reference herein to the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
amendment or supplement to any of the foregoing, shall be deemed to include
the respective copies thereof filed with the Commission on XXXXX.
(ii) The Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own or lease its properties and conduct
its business as described in the Registration Statement; each of the
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subsidiaries of the Company as listed on Schedule III hereto (collectively,
the "Subsidiaries") has been duly organized and is validly existing as a
corporation in good standing (to the extent such concepts are applicable)
under the laws of the jurisdiction of its incorporation, with corporate
power and authority to own or lease its properties and conduct its business
as described in the Registration Statement; the Company and each of the
Subsidiaries are duly qualified to transact business in all jurisdictions
in which the conduct of their business requires such qualification, except
where the failure to be so qualified would not have a material adverse
effect on the business, financial condition, liquidity, or results of
operation of the Company and the Subsidiaries taken as a whole (a "Material
Adverse Effect"); the outstanding shares of capital stock of each of the
Subsidiaries have been duly authorized and validly issued, are fully paid
and non-assessable and are owned directly or indirectly by the Company free
and clear of all liens, encumbrances, equities, and claims; and no options,
warrants or other rights to purchase, agreements or other obligations to
issue or other rights to convert any obligations into shares of capital
stock or ownership interests in the Subsidiaries are outstanding. The
Subsidiaries are the only subsidiaries, direct or indirect, of the Company.
(iii) The outstanding shares of Common Stock of the Company, including
all Shares to be sold by the Selling Stockholders, have been duly
authorized and validly issued and are fully paid and non-assessable; the
Shares to be issued and sold by the Company have been duly authorized and
when issued and paid for as contemplated herein will be validly issued,
fully paid and non-assessable; and no preemptive rights of stockholders
exist pursuant to the Company's Third Restated Certificate of
Incorporation, as amended (the "Charter"), its by-laws, as amended (the
"By-Laws"), or any other agreement or instrument to which the Company is a
party with respect to any of the Shares to be issued and sold by the
Company. 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 or satisfied, for the
registration of any shares of Common Stock.
(iv) The information set forth under the caption "Capitalization" in
the Prospectus is true and correct in all material respects. The Shares
conform or when issued, delivered and paid for in the manner set forth in
this Agreement will conform to the description thereof contained in the
Registration Statement. The certificates evidencing the Shares to be sold
and delivered by the Company hereunder are in due and proper form under the
corporate law of the jurisdiction of the Company's incorporation.
(v) The Commission has not issued an order preventing or suspending
the use of any Prospectus relating to the proposed offering of the Shares
nor, to the knowledge of the Company, instituted proceedings for that
purpose. The Registration Statement contains, and the Prospectus and any
amendments or supplements thereto will contain, all statements which are
required to be stated therein by, and in all respects conform or will
conform, as the case may be, to the requirements of, the Act and the Rules
and Regulations. The documents incorporated by reference in the Prospectus,
at the time filed with the Commission, conformed in all material respects
to the requirements of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or the Act, as applicable, and the rules and regulations
of the Commission thereunder. Neither the Registration Statement nor any
amendment thereto, and neither the Prospectus nor any supplement thereto,
contains or will contain, as the case may be, any untrue statement of a
material fact or
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omits or will omit to state any material fact required to be stated therein
or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that the Company makes no representations or warranties as to
information contained in or omitted from the Registration Statement or the
Prospectus, or any such amendment or supplement, in reliance upon, and in
conformity with, written information furnished to the Company by or on
behalf of any Underwriter through the Representatives specifically for use
in the preparation thereof.
(vi) The consolidated financial statements of the Company and the
Subsidiaries, together with related notes and schedules as set forth in the
Registration Statement, present fairly, in all material respects, the
consolidated financial position and results of operations and cash flows of
the Company and the Subsidiaries, at the indicated dates and for the
indicated periods. Such financial statements have been prepared in
accordance with generally accepted accounting principles, consistently
applied throughout the periods involved, and all adjustments necessary for
a fair presentation of results for such periods have been made, in each
case except as otherwise disclosed in the notes to such financial
statements. The summary financial and statistical data included in the
Registration Statement present fairly the information shown therein and
such data have been compiled on a basis consistent with the financial
statements presented therein and the books and records of the Company.
(vii) There is no action, suit, claim or proceeding pending or, to the
knowledge of the Company, threatened against the Company or any of the
Subsidiaries before any court or administrative agency which if determined
adversely to the Company or any of its Subsidiaries might result in a
Material Adverse Effect, except as set forth in the Registration Statement.
(viii) The Company and the Subsidiaries own, or have valid rights to
use, all of the properties and assets reflected in the financial statements
(or as described in the Registration Statement) hereinabove described,
subject to no lien, mortgage, pledge, charge or encumbrance of any kind
except those reflected in such financial statements (or as described in the
Registration Statement) or which secure obligations not material in amount.
The Company and the Subsidiaries occupy their leased properties under valid
and binding leases conforming to the description thereof set forth in the
Registration Statement (it being understood that certain of such leases by
their terms are on a "month-to-month" basis), with such exceptions as are
not significant in light of the intended use of the property by the Company
or a Subsidiary.
(ix) The Company and the Subsidiaries have filed all Federal income
tax returns which have been required to be filed and have paid all taxes
indicated by said returns and all assessments received by any of them to
the extent that such taxes have become due, except for assessments
contested in good faith for which adequate reserves have been provided to
the extent required by generally accepted accounting principles. The
Company and the Subsidiaries have filed all State, local and foreign income
tax returns which have been required to be filed and have paid all taxes
indicated by said returns and all assessments received by any of them to
the extent that such taxes have become due, except for such failures to
file as would not have a Material Adverse Effect and except for the failure
to pay assessments contested in good faith.
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(x) Since the respective dates as of which information is given in the
Registration Statement, as it may be amended or supplemented, and except as
specifically disclosed in or contemplated by the Prospectus, there has not
been any material adverse change or any development involving a prospective
material adverse change in or affecting the earnings, business, management,
condition (financial or otherwise), or business prospects of the Company
and its Subsidiaries taken as a whole, whether or not occurring in the
ordinary course of business, and there has not been any material
transaction entered into by the Company or the Subsidiaries, other than
transactions in the ordinary course of business and changes and
transactions contemplated by the Registration Statement, as it may be
amended or supplemented. The Company and the Subsidiaries have no material
contingent obligations which are not disclosed in the Registration
Statement.
(xi) Neither the Company nor any of the Subsidiaries is or, as a
result of the giving of notice or lapse of time or both will be, in
violation of or in default under its Charter or By-Laws, or under any
agreement, lease, contract, indenture or other instrument or obligation to
which it is a party or by which it or any of its properties is bound and
which default is of material significance in respect of the business,
management, condition (financial or otherwise) or business prospects of the
Company and the Subsidiaries taken as a whole. The execution and delivery
of this Agreement and the consummation of the transactions herein
contemplated and the fulfillment of the terms hereof will not conflict with
or result in a breach of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust or other agreement or
instrument to which the Company or any Subsidiary is a party, or of the
Charter or By-laws of the Company or any order, rule or regulation
applicable to the Company or any Subsidiary of any court or of any
regulatory body or administrative agency or other governmental body having
jurisdiction.
(xii) Each approval, consent, order, authorization, designation,
declaration or filing by or with any regulatory, administrative or other
governmental body necessary in connection with the execution and delivery
by the Company of this Agreement and the consummation by the Company of the
transactions herein contemplated (except such additional steps as may be
required by the Commission, the National Association of Securities Dealers,
Inc. (the "NASD"), the Nasdaq National Market, or such additional steps as
may be necessary to qualify the Shares for public offering by the
Underwriters under state securities or Blue Sky laws) has been obtained or
made and is in full force and effect.
(xiii) The Company and each of the Subsidiaries holds all licenses,
certificates and permits from governmental authorities which are material
to the conduct of the business of the Company and the Subsidiaries taken as
a whole.
(xiv) The Company or a Subsidiary owns or possesses adequate licenses
or other rights to use all service marks, service xxxx applications, trade
names, copyrights, manufacturing processes, formulae, trade secrets and
know-how or other information (together with patents, patent applications,
trademarks and trademark applications, collectively "Intellectual
Property") described in the Prospectus as owned by or used by them or which
are necessary to the conduct of their business as described in the
Prospectus, except where the failure to own or possess any such licenses or
rights would not have a Material Adverse Effect. To the knowledge of the
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Company after reasonable inquiry (it being understood that reasonable
inquiry does not mean an inquiry that would be adequate to conclusively
establish that no failure to own or possess could exist anywhere in the
world), the Company or a Subsidiary owns or possesses adequate licenses or
other rights to use all patents, patent applications, trademarks and
trademark applications described in the Prospectus as owned by or used by
them or which are necessary to the conduct of their business as described
in the Prospectus, except where the failure to own or possess any such
licenses or rights would not have a Material Adverse Effect. To the
knowledge of the Company, none of the patent rights owned or licensed by
the Company are unenforceable or invalid. The Company is not aware of any
infringement of or conflict with the rights or claims of others with
respect to any of the Company's products or Intellectual Property which
could have a Material Adverse Effect. Except as a result of the license of
its software in the ordinary course of business, the Company is not aware
of the granting of any patent rights to third parties or the filing of
patent application by third parties or any other rights of third parties to
any of the Company's Intellectual Property. The Company is not aware of any
ongoing infringement of any of the Company's Intellectual Property rights
by any third party which could have a Material Adverse Effect. The Company
has duly and properly filed or caused to be filed with the United States
Patent and Trademark Office all United States patents described or referred
to in the Prospectus. The Company has clear title to its patents referenced
in the Prospectus.
(xv) Except as otherwise set forth in the Prospectus, there are no
material legal, governmental, regulatory or administrative proceedings
pending to which the Company or any of the Subsidiaries is a party or to
which any of their respective property is subject, and, to the Company's
knowledge, no such proceedings are threatened or contemplated. No contract
or document of a character required to be described in the Registration
Statement or the Prospectus or to be filed as an exhibit to the
Registration Statement is not so described or filed as required.
(xvi) Neither the Company nor the any of the Subsidiaries is, and
after giving effect to the issuance of the Shares hereunder will be, an
"investment company" within the meaning of the Investment Company Act of
1940, as amended (the "1940 Act").
(xvii) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances, in all material respects, that
(i) transactions are executed in accordance with management's general or
specific authorization; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(xviii) The Company and each of its Subsidiaries carry, or are covered
by, insurance in such amounts and covering such risks as is customary for
companies engaged in similar industries.
(xix) The Company, the U.S. Subsidiaries (as defined below) and
DynaSoft AB collectively hold ___% of the assets of the Company and its
Subsidiaries (as defined below) taken as a whole (in each case calculated
based on the book value thereof).
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(xx) Deloitte & Touche LLP, who have certified certain of the
financial statements filed with the Commission as part of the Registration
Statement, are independent public accountants as required by the Act and
the Rules and Regulations.
(xxi) Neither the Company, nor to the Company's best knowledge, any of
its affiliates, has taken, directly or indirectly, any action designed to
cause or result in, or which has constituted, the stabilization or
manipulation of the price of the shares of Common Stock to facilitate the
sale or resale of the Shares.
(b) Each of the Selling Stockholders severally represents and warrants to
each of the Underwriters and the Company as follows:
(i) Such Selling Stockholder has and at the Closing Date and the
Option Closing Date, as the case may be (as such dates are hereinafter
defined) will have good and marketable title to the Shares to be sold by
such Selling Stockholder, free and clear of any liens, encumbrances,
equities and claims, and full right, power and authority to effect the sale
and delivery of such Shares; and upon the delivery of and against payment
for such Shares pursuant to this Agreement, the Underwriters will acquire
good and marketable title thereto, free and clear of any liens,
encumbrances, equities and claims, assuming that they are bona fide
purchasers within the meaning of the Uniform Commercial Code as in effect
in The Commonwealth of Massachusetts.
(ii) Such Selling Stockholder has full right, power and authority to
execute and deliver this Agreement, the Custody Agreement (as such term is
defined in Section 2 below) and the Power of Attorney executed by such
Selling Stockholder (together with the Custody Agreement, the
"Shareholders' Agreements") and to perform such Selling Stockholder's
obligations under such documents; the execution and delivery of this
Agreement and the consummation by or on behalf of such Selling Stockholder
of the transactions herein and therein contemplated and the fulfillment by
such Selling Stockholder of the terms hereof will not require any consent,
approval, authorization, or other order of any court, regulatory body,
administrative agency or other governmental body (except as may be required
under the Act, state securities laws or Blue Sky laws) and thereof will not
result in a breach of any of the terms and provisions of, or constitute a
default under organizational documents of such Selling Stockholder, if not
an individual, or any indenture, mortgage, deed of trust or other agreement
or instrument to which such Selling Stockholder is a party, or of any
order, rule or regulation applicable to such Selling Stockholder of any
court or of any regulatory body or administrative agency or other
governmental body having jurisdiction; and no consent, approval,
authorization or order of or declaration or filing with any government,
governmental instrumentality or court is required for the execution,
delivery or performance of this Agreement or the Shareholders' Agreements
by such Selling Stockholder, except as may be required under the Act or any
state securities laws or Blue Sky laws in connection with the purchase and
distribution by the Underwriters of the Shares.
(iii) Such Selling Stockholder has not taken and will not take,
directly or indirectly, any action designed to, or which has constituted,
or which might reasonably be expected to cause or result in the
stabilization or manipulation of the price of the Common Stock of the
Company and, other than as permitted by the Act, the Selling Shareholder
will not distribute any prospectus or other offering material in connection
with the offering of the Shares.
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(iv) Without having undertaken to determine independently the accuracy
or completeness of either the representations and warranties of the Company
contained herein or the information contained in the Registration
Statement, such Selling Stockholder has no actual knowledge of any material
fact, condition or information not disclosed in the Registration Statement
which has adversely affected in any material respect or may adversely
affect in any material respect the business of the Company and the
Subsidiaries taken as a whole.
(v) The information pertaining to such Selling Stockholder under the
caption "Selling Stockholders" in the Prospectus is complete and accurate
in all material respects.
2. PURCHASE, SALE AND DELIVERY OF THE SHARES.
(a) On the basis of the representations, warranties and covenants herein
contained, and subject to the conditions herein set forth, the Sellers agree to
sell to the Underwriters and each Underwriter agrees, severally and not jointly,
to purchase, at a price of $________ per share, the number of Firm Shares set
forth opposite the name of each Underwriter in Schedule I hereof, subject to
adjustments in accordance with Section 9 hereof. The number of Firm Shares to be
purchased by each Underwriter from each Seller shall be as nearly as practicable
in the same proportion to the total number of Firm Shares being sold by each
Seller as the number of Firm Shares being purchased by each Underwriter bears to
the total number of Firm Shares to be sold hereunder. The obligations of the
Company and of each of the Selling Stockholders shall be several and not joint.
(b) Certificates in negotiable form for the total number of the Shares to
be sold hereunder by the Selling Stockholders have been placed in custody with
the Company as custodian (the "Custodian") pursuant to a Custody Agreement (the
"Custody Agreement") executed by each Selling Stockholder for delivery of all
Shares to be sold hereunder by the Selling Stockholders. Each of the Selling
Stockholders specifically agrees that the Shares represented by the certificates
held in custody for such Selling Stockholder under the Custody Agreement are
subject to the interests of the Underwriters hereunder, that the arrangements
made by such Selling Stockholder for such custody are to that extent
irrevocable, and that the obligations of such Selling Stockholder hereunder
shall not be terminable by any act or deed of such Selling Stockholder (or by
any other person, firm or corporation including the Custodian or the
Underwriters) or by operation of law (including the death of an individual
Selling Stockholder or the dissolution of a corporate Selling Stockholder) or by
the occurrence of any other event or events, except as set forth in the Custody
Agreement. If any such event should occur prior to the delivery to the
Underwriters of the Shares hereunder, certificates for the Shares shall be
delivered by the Custodian in accordance with the terms and conditions of this
Agreement as if such event has not occurred. The Custodian is authorized to
receive and acknowledge receipt of the proceeds of sale of the Shares held by it
against delivery of such Shares.
(c) Payment for the Firm Shares to be sold hereunder is to be made by wire
transfer of same-day funds to an account of the Company for the Shares to be
sold by it and to an account of the Company "as Custodian" for the Shares to be
sold by the Selling Stockholders, in each case against delivery of certificates
therefor to the Representatives for the several accounts of the Underwriters.
Such payment and delivery are to be made at the offices of BT Alex. Xxxxx
Incorporated, 000 Xxxx Xxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx, at 10:00 a.m.,
Baltimore time, on the third business day after the date of this
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Agreement or at such other time and date not later than five business days
thereafter as you and the Company shall agree upon, such time and date being
herein referred to as the "Closing Date." (As used herein, "business day" means
a day on which the New York Stock Exchange is open for trading and on which
banks in New York are open for business and not permitted by law or executive
order to be closed.) The certificates for the Firm Shares will be delivered in
such denominations and in such registrations as the Representatives request in
writing not later than the second full business day prior to the Closing Date,
and will be made available for inspection by the Representatives at least one
business day prior to the Closing Date.
(d) In addition, on the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the Company
hereby grants an option to the several Underwriters to purchase the Option
Shares at the price per share as set forth in paragraph (a) of this Section 2.
The option granted hereby may be exercised in whole or in part by giving written
notice (i) at any time before the Closing Date and (ii) only once thereafter
given within 30 days after the date of this Agreement, by you, as
Representatives of the several Underwriters, to the Company setting forth the
number of Option Shares as to which the several Underwriters are exercising the
option, the names and denominations in which the Option Shares are to be
registered and the time and date at which such certificates are to be delivered.
The time and date at which certificates for Option Shares are to be delivered
shall be determined by the Representatives but shall not be earlier than three
nor later than 10 full business days after the exercise of such option, nor in
any event prior to the Closing Date (such time and date being herein referred to
as the "Option Closing Date"). If the date of exercise of the option is three or
more days before the Closing Date, the notice of exercise shall set the Closing
Date as the Option Closing Date. The number of Option Shares to be purchased by
each Underwriter shall be in the same proportion to the total number of Option
Shares being purchased as the number of Firm Shares being purchased by such
Underwriter bears to the total number of Firm Shares being purchased, adjusted
by you in such manner as is necessary to avoid fractional shares. The option
with respect to the Option Shares granted hereunder may be exercised only to
cover over-allotments in the sale of the Firm Shares by the Underwriters. You,
as Representatives of the several Underwriters, may cancel such option at any
time prior to its expiration by giving written notice of such cancellation to
the Company. To the extent, if any, that the option is exercised, payment for
the Option Shares shall be made on the Option Closing Date by wire transfer of
same-day funds to the account of the Company against delivery of certificates
thereof to the Representatives for the several accounts of the Underwriters.
3. OFFERING BY THE UNDERWRITERS.
It is understood that the several Underwriters are to make a public
offering of the Firm Shares as soon as the Representatives deem it advisable to
do so. The Firm Shares are to be initially offered to the public at the initial
public offering price set forth in the Prospectus. The Representatives may from
time to time thereafter change the public offering price and other selling
terms. To the extent, if at all, that any Option Shares are purchased pursuant
to Section 2 hereof, the Underwriters will offer them to the public on the
foregoing terms.
It is further understood that you will act as the Representatives for the
Underwriters in the offering and sale of the Shares in accordance with a Master
Agreement Among Underwriters entered into by you and the several other
Underwriters.
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4. COVENANTS OF THE COMPANY AND THE SELLING STOCKHOLDERS.
(a) The Company covenants and agrees with the several Underwriters and the
Selling Stockholders that:
(i) The Company will (A) prepare and timely file with the Commission
under Rule 424(b) of the Rules and Regulations a Prospectus containing
information previously omitted at the time of effectiveness of the
Registration Statement in reliance on Rule 430A of the Rules and
Regulations, and (B) not file any amendment to the Registration Statement
or supplement to the Prospectus of which the Representatives shall not
previously have been advised and furnished with a copy or to which the
Representatives shall have reasonably objected in writing or which is not
in compliance with the Rules and Regulations. To the extent applicable, the
copies of the Registration Statement (including all exhibits filed
therewith), any Preliminary Prospectus or Prospectus furnished to the
Underwriters shall be identical to the copies thereof electronically filed
with the Commission on XXXXX, except to the extent permitted by Regulation
S-T.
(ii) The Company will advise the Representatives promptly (A) when any
post-effective amendment to the Registration Statement shall have become
effective, (B) of receipt subsequent to the execution hereof of any
comments from the Commission, (C) of any request of the Commission for
amendment of the Registration Statement or for supplement to the Prospectus
or for any additional information, and (D) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the use of the Prospectus or of the institution
of any proceedings for that purpose, and the Company will use its best
efforts to prevent the issuance of any such stop order preventing or
suspending the use of the Prospectus and to obtain as soon as possible the
lifting thereof, if issued.
(iii) The Company will cooperate with the Representatives in
endeavoring to qualify the Shares for sale under the securities laws of
such jurisdictions as the Representatives may reasonably have designated in
writing and will make such applications, file such documents, and furnish
such information as may be reasonably required for that purpose, provided
the Company shall not be required to qualify as a foreign corporation or to
file a general consent to service of process in any jurisdiction where it
is not now so qualified or required to file such a consent. 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
in effect for so long a period as the Representatives may reasonably
request for distribution of the Shares.
(iv) The Company will deliver to, or upon the order of, the
Representatives from time to time, as many copies of any Preliminary
Prospectus as the Representatives may reasonably request. The Company will
deliver to, or upon the order of, the Representatives during the period
when delivery of a Prospectus is required under the Act, as many copies of
the Prospectus in final form, or as thereafter amended or supplemented, as
the Representatives may reasonably request. The Company will deliver to the
Representatives at or before the Closing Date, four signed copies of the
Registration Statement and all amendments thereto, including all exhibits
filed therewith, and will deliver to the Representatives such number of
copies of the Registration Statement (including such number of copies of
the exhibits filed therewith that may reasonably be requested) and of all
amendments thereto, as the Representatives may reasonably request.
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(v) The Company will comply with the Act and the Rules and
Regulations, and the Exchange Act, and the rules and regulations of the
Commission thereunder, so as to permit the completion of the distribution
of the Shares as contemplated in this Agreement and the Prospectus. If
during the period in which a prospectus is required by law to be delivered
by an Underwriter or dealer any event shall occur as a result of which, in
the judgment of the Company or in the opinion of counsel for the
Underwriters, it becomes necessary to amend or supplement the Prospectus in
order to make the statements therein, in the light of the circumstances
existing at the time the Prospectus is delivered to a purchaser, not
misleading, or, if it is necessary at any time to amend or supplement the
Prospectus to comply with any law, the Company promptly will either (A)
prepare and file with the Commission an appropriate amendment to the
Registration Statement or supplement to the Prospectus or (B) prepare and
file with the Commission an appropriate filing under the Exchange Act which
shall be incorporated by reference in the Prospectus so that the Prospectus
as so amended or supplemented will not, in the light of the circumstances
when it is so delivered, be misleading, or so that the Prospectus will
comply with the law.
(vi) The Company will make generally available to its security
holders, as soon as it is practicable to do so, but in any event not later
than 15 months after the effective date of the Registration Statement, an
earning statement (which need not be audited) in reasonable detail,
covering a period of at least 12 consecutive months beginning after the
effective date of the Registration Statement, which earning statement shall
satisfy the requirements of Section 11(a) of the Act and Rule 158 of the
Rules and Regulations and will advise you in writing when such statement
has been so made available.
(vii) The Company will, for a period of five years from the Closing
Date, deliver to the Representatives copies of annual reports and copies of
all other documents, reports and information furnished by the Company to
its stockholders or filed with any securities exchange pursuant to the
requirements of such exchange or with the Commission pursuant to the Act or
the Exchange Act. The Company will deliver to the Representatives similar
reports with respect to significant subsidiaries, as that term is defined
in the Rules and Regulations, which are not consolidated in the Company's
financial statements. To the extent applicable, such reports and documents
shall be identical to any copies thereof electronically filed with the
Commission on XXXXX, except to the extent permitted by Regulation S-T.
(viii) The Company will not offer, sell or otherwise dispose of any
shares of Common Stock of the Company or other securities convertible into
or exchangeable or exercisable for shares of Common Stock or derivative of
Common Stock of the Company (or any agreement for such) for a period of 90
days after the date of this Agreement, directly or indirectly, otherwise
than hereunder or with the prior written consent of the Representatives,
except that the Company may, without such consent, (A) issue shares upon
the exercise of options outstanding on the date of this Agreement issued
pursuant to its 1986 Stock Option Plan, as amended, 1994 Stock Option Plan,
1994 Director Stock Option Plan, as amended, and 1994 Employee Stock
Purchase Plan, as amended, (B) issue shares in respect of the acquisition
by the Company of the assets or capital stock of another person or entity,
provided, however, that any such shares so issued shall be subject to the
restrictions on offers, sales and dispositions of shares set forth in this
Section 4(a)(viii) for the remainder of the 90-day period referenced above
in this Section, and (C) grant
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options, offer to sell and sell shares of Common Stock to its employees and
directors pursuant to the plans listed in clause (A).
(ix) The Company will use its best efforts to have the Shares
authorized for inclusion on the Nasdaq National Market.
(x) The Company has caused each officer and director and certain
stockholders of the Company to furnish to you, on or prior to the date of
this agreement, a letter or letters (each, a "Lock-Up Agreement"), in form
and substance satisfactory to the Underwriters, pursuant to which each such
person shall agree to not, otherwise than hereunder or with the prior
written consent of BT Alex. Xxxxx Incorporated or in accordance with a
transfer permitted by such Lock-Up Agreement, directly or indirectly,
offer, sell, pledge, contract to sell, grant any option to purchase or
otherwise dispose of (i) any of such person's Locked-Up Shares (as defined
below) during the period commencing on the date specified in such
agreements and ending on the 49th day after the Effective Date (as defined
below), (ii) no more than 20% of such person's Locked-Up Shares during the
period commencing on the 50th day after the Effective Date and ending on
the 89th day after the Effective Date, and (iii) no more than an additional
20% of such person's Locked-Up Shares (for a total of 40%) during the
period commencing on the 70th day after the Effective Date and ending on
the 89th day after the Effective Date, provided, however, that each former
stockholder of DynaSoft AB who is a party to a Lock-Up Agreement (each a
"DynaSoft Seller" and collectively, the "DynaSoft Sellers") shall be
relieved from such DynaSoft Seller's obligations under his, her or its
Lock-Up Agreement if the Closing Date hereunder and payment to the DynaSoft
Sellers for such DynaSoft Sellers' Shares has not occurred or, in the case
of a payment, been received by the DynaSoft Sellers by November 7, 1997.
For purposes of this Section 4(a)(x), "Locked-Up Shares" shall mean any
shares of Common Stock (including, without limitation, shares of Common
Stock that may be deemed to be beneficially owned by such officer, director
or stockholder on the date of such letter in accordance with the rules and
regulations of the Commission and shares of Common Stock that may be issued
upon exercise of a stock option or warrant) or any securities convertible
into, derivative of or exercisable or exchangeable for such Common Stock,
and "Effective Date" shall mean the date on which the Registration
Statement becomes effective under the Act.
(xi) The Company shall apply the net proceeds of its sale of the
Shares as set forth in the Prospectus.
(xii) The Company shall not invest, or otherwise use the proceeds
received by the Company from its sale of the Shares in such a manner as
would require the Company or any of the Subsidiaries to register as an
investment company under the 1940 Act.
(xiii) The Company will not take, directly or indirectly, any action
designed to cause or result in, or that might reasonably be expected to
constitute, the stabilization or manipulation of the price of any
securities of the Company.
(b) Each of the Selling Stockholders covenants and agrees with the several
Underwriters and the Company that:
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(i) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 and the Interest and Dividend Tax Compliance Act
of 1983 with respect to the transactions herein contemplated, each of the
Selling Stockholders agrees to deliver to you prior to or at the Closing
Date a properly completed and executed United States Treasury Department
Form W-9 or Form W-8 (or other applicable form or statement specified by
Treasury Department regulations in lieu thereof).
(ii) Such Selling Shareholder will not take, directly or indirectly,
any action designed to cause or result in, or that might reasonably be
expected to constitute, the stabilization or manipulation of the price of
any securities of the Company.
5. COSTS AND EXPENSES.
The Company will pay all costs, expenses and fees incident to the
performance of the obligations of the Sellers under this Agreement, including,
without limiting the generality of the foregoing, the following: accounting fees
of the Company; the fees and disbursements of counsel for the Company and the
Selling Stockholders; the cost of printing and delivering to, or as requested
by, the Underwriters copies of the Registration Statement, Preliminary
Prospectuses, the Prospectus, this Agreement, the Agreement Among Underwriters,
the Underwriters' Selling Memorandum, the Underwriters' Questionnaire, the
Invitation Letter, the Power of Attorney, the Blue Sky Survey and any
supplements or amendments thereto; the filing fees of the Commission; the filing
fees and expenses (including reasonable legal fees and expenses) incident to
securing any required review by the National Association of Securities Dealers,
Inc. (the "NASD") of the terms of the sale of the Shares; and the expenses,
including the fees and disbursements of counsel for the Underwriters, incurred
in connection with the qualification of the Shares under state securities or
Blue Sky laws. To the extent, if at all, that any of the Selling Stockholders
engage special legal counsel to represent them in connection with this offering,
the fees and expenses of such counsel shall be borne by such Selling
Stockholders. Any transfer taxes imposed on the sale of the Shares to the
several Underwriters will be paid by the Sellers pro rata. The Sellers shall
not, however, be required to pay for any of the Underwriters' expenses (other
than those related to qualification under NASD regulation, state securities laws
or Blue Sky laws) except that, if this Agreement shall not be consummated
because the conditions in Section 7 hereof are not satisfied, or because this
Agreement is terminated by the Representatives pursuant to Section 6 hereof, or
by reason of any failure, refusal or inability on the part of the Company or the
Selling Stockholders to perform any undertaking or satisfy any condition of this
Agreement or to comply with any of the terms hereof on their part to be
performed, unless such failure to satisfy said condition or to comply with said
terms shall be due to the default or omission of any Underwriter, then the
Company shall reimburse the several Underwriters for reasonable out-of-pocket
expenses, including fees and disbursements of counsel, reasonably incurred in
connection with investigating, marketing and proposing to market the Shares or
in contemplation of performing their obligations hereunder; but the Company and
the Selling Stockholders shall not in any event be liable to any of the several
Underwriters for damages on account of loss of anticipated profits from the sale
by them of the Shares.
6. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS.
The several obligations of the Underwriters to purchase the Firm Shares on
the Closing Date and the Option Shares, if any, on the Option Closing Date are
subject to the accuracy, as of the Closing Date
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or the Option Closing Date, as the case may be, of the representations and
warranties of the Company and the Selling Stockholders contained herein, and to
the performance by the Company and the Selling Stockholders of their covenants
and obligations hereunder and to the following additional conditions:
(a) The Registration Statement and all post-effective amendments thereto
shall have become effective and any and all filings required by Rule 424 and
Rule 430A of the Rules and Regulations shall have been made, and any request of
the Commission for additional information (to be included in the Registration
Statement or otherwise) shall have been disclosed to the Representatives and
complied with to their reasonable satisfaction. No stop order suspending the
effectiveness of the Registration Statement, as amended from time to time, shall
have been issued and no proceedings for that purpose shall have been taken or,
to the knowledge of the Company or the Selling Stockholders, shall be
contemplated by the Commission and no injunction, restraining order, or order of
any nature by a Federal or state court of competent jurisdiction shall have been
issued as of the Closing Date that would prevent the issuance of the Shares.
(b) The Representatives shall have received on the Closing Date or the
Option Closing Date, as the case may be, the opinion of Xxxx and Xxxx LLP,
counsel for the Company and special counsel for the Selling Stockholders, dated
the Closing Date or the Option Closing Date, as the case may be, addressed to
the Underwriters to the effect that:
(i) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Delaware,
with corporate power and authority to own or lease its properties and
conduct its business as described in the Prospectus; SD Securities Corp.,
RSA Data Security, Inc. and SD Investment Corp. (the "U.S. Subsidiaries")
have been duly incorporated and are validly existing as corporations in
good standing under the laws of the jurisdictions of their respective
incorporations, with corporate power and authority to own or lease their
respective properties and conduct their businesses as, to the knowledge of
such counsel, currently owned or conducted by them; the Company is duly
qualified to transact business in each of the jurisdictions listed on
Schedule IV attached hereto; the outstanding shares of capital stock of
each of the U.S. Subsidiaries have been duly authorized and validly issued,
are fully paid and non-assessable and are owned of record by the Company or
a subsidiary of the Company; and, to such counsel's knowledge, (A) the
outstanding shares of capital stock of each of the U.S. Subsidiaries are
owned free and clear of all liens, encumbrances, equities and claims, and
(B) no options, warrants or other rights to purchase, agreements or other
obligations to issue or other rights to convert any obligations into any
shares of capital stock or of ownership interests in the U.S. Subsidiary
are outstanding.
(ii) The Company has authorized and outstanding of record capital
stock as set forth under the caption "Capitalization" in the Prospectus
(except for subsequent issuances, if any, pursuant to stock plans described
in the Prospectus); the outstanding shares of its Common Stock, including
the Shares to be sold by the Selling Stockholders, have been duly
authorized and validly issued and are fully paid and non-assessable; all of
the Shares conform, or when issued, delivered and paid for in accordance
with the terms of this Agreement will conform, in all material respects, to
the description thereof contained in the Prospectus; the certificates
evidencing the Shares delivered to the Representatives for the several
accounts of the Underwriters are in due and proper form under Delaware law,
and when duly countersigned by the Company's transfer agent and registrar
and
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delivered to you or upon your order against payment of the agreed
consideration therefor in accordance with the provisions of this Agreement,
the Shares represented thereby will be duly authorized and validly issued,
fully paid and non-assessable; there are no statutory preemptive rights or,
to such counsel's knowledge, contractual preemptive rights to subscribe for
or purchase the Shares to be sold by the Company hereunder.
(iii) The Registration Statement has become effective under the Act
and, to the knowledge of such counsel, no stop order proceedings with
respect thereto have been instituted or are pending or threatened by the
Commission.
(iv) The Registration Statement, all Preliminary Prospectuses, the
Prospectus and each amendment or supplement thereto, when filed, and the
Registration Statement and definitive Prospectus, when declared effective,
complied as to form in all material respects with the requirements of the
Act and the applicable Rules and Regulations thereunder (except that such
counsel need express no opinion as to the financial statements, including
the notes and schedules thereto, or any other financial or accounting
information included or incorporated by reference therein). In passing upon
the form of such documents, such counsel is not passing upon the statements
made therein and takes no responsibility therefor.
(v) The statements under the caption "Risk Factors - Antitakeover
Provisions" in the Prospectus, insofar as such statements constitute
matters of law or legal conclusions, have been reviewed by us and are
correct in all material respects.
(vi) Such counsel does not know of any contracts or documents required
by the Act or by the Rules and Regulations thereunder to be filed as
exhibits to the Registration Statement or described in the Registration
Statement or the Prospectus which are not so filed, incorporated by
reference or described as required.
(vii) Such counsel knows of no material legal or governmental
proceedings pending or threatened against the Company or any of the
Subsidiaries required to be described in the Prospectus which are not
described as required.
(viii) The execution and delivery of this Agreement by the Company and
the consummation by the Company of the transactions herein contemplated do
not conflict with or result in a breach of any of the terms or provisions
of, or constitute a default under, the Charter or By-laws of the Company,
or any agreement or instrument listed as an Exhibit to the Registration
Statement.
(ix) This Agreement has been duly authorized, executed and delivered
by the Company.
(x) No approval, consent, order, authorization, designation,
declaration or filing by or with any regulatory, administrative or other
governmental body is necessary in connection with the execution and
delivery by the Company of this Agreement and the consummation by the
Company of the transactions herein contemplated, except such as have been
obtained or made and are in full force and effect and such as may be
required by the NASD, or by state securities and Blue Sky laws, as to which
such counsel need express no opinion.
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(xi) Each of this Agreement and the Shareholders' Agreements has been
duly authorized, executed and delivered by or on behalf of each of the
Selling Stockholders.
(xii) To the knowledge of such counsel, each Selling Stockholder has
the legal right, power and authority, and any approval required by law
(other than as required by state securities and Blue Sky laws, as to which
such counsel need express no opinion), to sell, transfer and deliver the
portion of the Shares to be sold by such Selling Stockholder under this
Agreement.
(xiii) To the knowledge of such counsel, the Shareholders' Agreements
executed and delivered by each Selling Stockholder are valid, irrevocable
instruments legally sufficient for the purposes intended.
(xiv) Upon the Underwriters obtaining control of the Shares to be sold
by the Selling Stockholders and assuming the Underwriters purchased such
Shares for value and without notice of any adverse claim to such Shares
within the meaning of Section 8-102 of the Uniform Commercial Code as in
effect in The Commonwealth of Massachusetts, the Underwriters will have
acquired all rights of the Selling Stockholders in such Shares free of any
adverse claim, any lien in favor of the Company and any restrictions on
transfer imposed by the Company.
(xv) The Company did not, immediately prior to the issuance of the
Shares, constitute an "investment company" as such term is defined in the
1940 Act.
(xvi) The Company will not, upon the issuance of the Shares, receipt
of the proceeds thereof as contemplated by this Agreement and the
investment of such proceeds in accordance with a certificate of the
Company, constitute an "investment company" as such term is defined in the
1940 Act.
In rendering such opinion, Xxxx and Xxxx LLP may rely as to all
matters governed other than by the laws of The Commonwealth of
Massachusetts, the Delaware General Corporation Law statute or Federal laws
on local counsel in such jurisdictions, and in rendering the opinions set
forth in subparagraphs (xi), (xii), (xiii) and (xiv) on opinions of other
counsel, reasonably satisfactory to the Underwriters, representing each
Selling Stockholder or, in the case of a natural person, on representations
made by the Selling Stockholder. In addition to the matters set forth
above, such opinion shall also include a statement to the effect that no
facts have come to the attention of such counsel which have caused such
counsel to believe that the Registration Statement, at the time it became
effective under the Act (but after giving effect to changes incorporated
therein pursuant to Rule 430A under the Act), the Prospectus or any
amendment or supplement thereto, on the date it was filed pursuant to Rule
424(b) and the Registration Statement and the Prospectus, or any amendment
or supplement thereto, as of the Closing Date or the Option Closing Date,
as the case may be, contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make
the statements therein not misleading (except that such counsel need
express no view as to financial statements, including the notes and
schedules thereto, or any financial or accounting information, or
information relating to the Underwriters or the method of distribution of
the Shares by the Underwriters included or incorporated by reference
therein). With respect to such statement, Xxxx and Xxxx LLP may state
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that their belief is based upon the procedures set forth therein, but is
without independent check and verification.
(c) The Representatives shall have received on the Closing Date or the
Option Closing Date, as the case may be, the opinion of Wolf, Greenfield &
Sacks, P.C., intellectual property counsel for the Company, dated the Closing
Date or the Option Closing Date, as the case may be, addressed to the
Underwriters to the effect that such counsel are familiar with the technology
used by the Company in its business and the manner of its use thereof and have
read the Registration Statement and the Prospectus, including particularly the
portions of the Registration Statement and the Prospectus referring to
trademarks, trade names, patents, mask works, copyrights, licenses, trade
secrets or other intellectual property rights and:
(i) To the best of such counsel's knowledge, neither the Registration
Statement nor the Prospectus (A) contains any untrue statement of a
material fact with respect to trademarks, trade names, patents, mask works,
copyrights, license, trade secrets or other intellectual property rights
owned or used by the Company, or the manner of its use thereof, or any
allegation on the part of any person or entity that the Company is
infringing any trademarks, trade names, patent rights, mask works,
copyrights, licenses, trade secrets or other intellectual property rights
of any such person or entity or (B) omits to state any material fact
relating to trademarks, trade names, patents, mask works, copyrights,
licenses, trade secrets or other intellectual property rights owned or used
by the Company, or the manner of its use thereof, or any allegation of
which such counsel have knowledge, that is required to be stated in the
Registration Statement or the Prospectus or is necessary to make the
statements therein not misleading;
(ii) To the best of such counsel's knowledge, and except as set forth
in the Prospectus under the captions "Risk Factors--Dependence on
Proprietary Technology" and "Business--Proprietary Rights," there are no
legal or governmental proceedings pending relating to trademarks, trade
names, patent rights, mask works, copyrights, licenses, trade secrets or
other intellectual property rights of the Company other than prosecution by
the Company of its patent and trademark/service xxxx applications before
the United States Patent Office and appropriate foreign government
agencies, and to the best of such counsel's knowledge no such proceedings
are threatened or contemplated by governmental authorities or others;
(iii) The Company duly and properly holds the patents and
trademark/service marks, and has duly and properly filed patent and/or
trademark/service xxxx applications and patent cooperation treaty
applications, listed or otherwise referred to in the Prospectus under the
caption "Business--Proprietary Rights";
(iv) Such counsel do not know of any contracts or other documents
relating to the Company's trademarks, trade names, patents, mask works,
copyrights, licenses, trade secrets or other intellectual property rights
of a character required to be filed as an exhibit to the Registration
Statement or required to be described in the Registration Statement or the
Prospectus that are not filed, incorporated by reference or described as
required;
(v) To the best of such counsel's knowledge, the Company is not
infringing or otherwise violating any trademarks, trade names, patents,
mask works, copyrights, licenses, trade secrets or
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other intellectual property rights of others, and to the best of such
counsel's knowledge, except as described in the Prospectus under the
captions "Risk Factors--Dependence on Proprietary Technology" and
"Business--Proprietary Rights," there are no infringements by others of any
of the Company's trademarks, trade names, patents, mask works, copyrights,
licenses, trade secrets or other intellectual property rights which in the
judgment of such counsel could affect materially the use thereof by the
Company or the ability of the Company to transfer any or all of such
property or rights to a third party; and
(vi) To the best of such counsel's knowledge, the Company owns or
possesses sufficient licenses or other rights to use all trademarks, trade
names, patents, mask works, copyrights, licenses, trade secrets or other
intellectual property rights necessary to conduct the business now being or
proposed to be conducted by the Company as described in the Prospectus.
In rendering such opinion, such counsel may, to the extent stated therein,
rely as to matters of fact on certificates of officers of the Company, copies of
which shall be attached to the opinion. In rendering such opinion, such counsel
need not have conducted any independent investigation or conducted searches to
locate any third party patents, mask works, copyrights or other intellectual
property rights that might impact the Company's activities.
(d) The Representatives shall have received on the Closing Date or the
Option Closing Date, as the case may be, the opinion of Xxxxxxxxxx Xxxxxxxxx,
special Swedish counsel for the Company, dated the Closing Date or the Option
Closing Date, as the case may be, addressed to the Underwriters to the effect
that DynaSoft AB ("DynaSoft"), has been duly incorporated and is validly
existing as a limited liability company under the laws of Sweden with corporate
power and authority to own or lease its properties and conduct its business as,
to the knowledge of such counsel, currently conducted by it; except for the
_____ shares of DynaSoft subscribed for by Securix Inc., the outstanding shares
of capital stock of DynaSoft have been duly authorized and validly issued are
fully paid and non-assessable and pursuant to the share register of DynaSoft are
owned of record by the Company; (A) pursuant to Swedish law, a pledge over
shares in a Swedish company which is not a VPC company (Swedish
avstamningsbolag) is created by the transfer to the pledgee of possession of the
share certificates pertaining to the shares; DynaSoft is not a VPC company;
pursuant to DynaSoft's share register no share certificates have been issued and
no notification of any pledge, lien, encumbrance, equity or claim has been noted
in the share register and provided no share certificates pertaining to the
shares in DynaSoft have in fact been issued and transferred or DynaSoft has been
notified of the creation of any pledge or lien, the outstanding shares of the
capital stock of DynaSoft are owned free and clear of all liens, encumbrances
and equities and (B) to such counsel's knowledge no options, warrants or other
rights to purchase, agreements or other obligations to issue or other rights to
convert any obligations into any shares of the capital stock or of ownership
interest in DynaSoft has been issued by or is binding upon DynaSoft.
(e) The Representatives shall have received from Ropes & Xxxx, counsel for
the Underwriters, an opinion dated the Closing Date or the Option Closing Date,
as the case may be, substantially to the effect specified in subparagraphs (ii),
(iii), (iv), (ix) and (xi) of Paragraph (b) of this Section 6, and that the
Company is a duly organized and validly existing corporation under the laws of
the State of Delaware. In rendering such opinion, Ropes & Xxxx may rely as to
all matters governed other than by the laws of The Commonwealth of
Massachusetts, the Delaware General Corporation Law or Federal laws, and as to
matters relating to the Selling Stockholders, on the opinions of counsel
referred to in Paragraph (b) of this
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Section 6. In addition to the matters set forth above, such opinion shall also
include a statement to the effect that nothing has come to the attention of such
counsel which leads them to believe that (i) the Registration Statement, or any
amendment thereto, as of the time it became effective under the Act (but after
giving effect to changes incorporated therein pursuant to Rule 430A under the
Act), as of the Closing Date or the Option Closing Date, as the case may be,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading and (ii) that the Prospectus or any amendment or supplement
thereto, on the date it was filed pursuant to the Rules and Regulations and as
of the Closing Date, or the Option Closing Date, as the case may be, contained
an untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading (except
that such counsel need express no view as to financial statements, schedules and
other financial information included therein). With respect to such statement,
Ropes & Xxxx may state that their belief is based upon the procedures set forth
therein, but is without independent check and verification.
(f) The Representatives shall have received at or prior to the Closing Date
from Ropes & Xxxx, a memorandum or summary, in form and substance satisfactory
to the Representatives, with respect to the qualification for offering and sale
by the Underwriters of the Shares under the State securities or Blue Sky laws of
such jurisdictions as the Representatives may reasonably have designated to the
Company.
(g) The Representatives shall have received on each of the date hereof, the
Closing Date and the Option Closing Date, as the case may be, a signed letter
from Deloitte & Touche LLP, dated the date hereof, the Closing Date or the
Option Closing Date, as the case may be, confirming that they are independent
public accountants within the meaning of the Act and the applicable published
Rules and Regulations thereunder and stating that in their opinion the financial
statements and schedules examined by them and included in the Registration
Statement comply in form in all material respects with the applicable accounting
requirements of the Act and the related published Rules and Regulations; and
containing such other statements and information as is ordinarily included in
accountants' "comfort letters" to Underwriters with respect to the financial
statements and certain financial and statistical information contained in the
Registration Statement and Prospectus. All such letters shall be in form and
substance satisfactory to the Representatives.
(h) The Representatives shall have received on the Closing Date or the
Option Closing Date, as the case may be, a certificate or certificates of (i)
the Chief Executive Officer or Chief Operating Officer of the Company and (ii)
the Chief Financial Officer of the Company, in each case to the effect that, as
of the Closing Date or the Option Closing Date, as the case may be, each of them
severally represents as follows:
(i) The Registration Statement has become effective under the Act and
no stop order suspending the effectiveness of the Registration Statement
has been issued, and no proceedings for such purpose have been taken or
are, to his or her knowledge, contemplated by the Commission.
(ii) He or she does not know of any litigation instituted or
threatened against the Company of a character required to be disclosed in
the Registration Statement which is not so disclosed; he or she does not
know of any material contract required to be filed as an exhibit to the
Registration Statement which is not so filed; and to his or her knowledge
the representations and warranties of
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the Company contained in Section 1(a) hereof are true and correct as of the
Closing Date or the Option Closing Date, as the case may be.
(iii) He or she has carefully examined the Registration Statement and
the Prospectus and, in his or her opinion, as of the effective date of the
Registration Statement, the statements contained in the Registration
Statement were true and correct, and such Registration Statement and
Prospectus did not omit to state a material fact required to be stated
therein or necessary in order to make the statements therein not misleading
and, in his or her opinion, since the effective date of the Registration
Statement, no event has occurred which should have been set forth in a
supplement to or an amendment of the Prospectus which has not been so set
forth in such supplement or amendment.
(iv) All filings required to have been made pursuant to Rule 424 or
Rule 430A under the Act have been made.
(i) The Company and the Selling Stockholders through the attorney-in-fact
designated in the Shareholders' Agreement shall have furnished to the
Representatives such further certificates and documents confirming the
representations and warranties, covenants and conditions contained herein and
related matters as the Representatives may reasonably have requested.
(j) The Company shall have taken all steps required to have the Firm Shares
and Option Shares, if any, authorized for inclusion on the Nasdaq National Stock
Market.
(k) The Lock-Up Agreements shall be in full force and effect.
The opinions and certificates mentioned in this Agreement shall be deemed
to be in compliance with the provisions hereof only if they are in all material
respects satisfactory to the Representatives and to Ropes & Xxxx, counsel for
the Underwriters.
If any of the conditions hereinabove provided for in this Section 6 shall
not have been fulfilled when and as required by this Agreement to be fulfilled,
the obligations of the Underwriters hereunder may be terminated by the
Representatives by notifying the Company and the Selling Stockholders of such
termination in writing or by telegram at or prior to the Closing Date or the
Option Closing Date, as the case may be. In such event, the Selling
Stockholders, the Company and the Underwriters shall not be under any obligation
to each other (except to the extent provided in Sections 5 and 8 hereof).
7. CONDITIONS OF THE OBLIGATIONS OF THE SELLERS.
The obligations of the Sellers to sell and deliver the portion of the
Shares required to be delivered as and when specified in this Agreement are
subject to the conditions that at the Closing Date or the Option Closing Date,
as the case may be, no stop order suspending the effectiveness of the
Registration Statement shall have been issued and in effect or proceedings
therefor initiated or threatened.
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8. INDEMNIFICATION.
(a) The Company and, subject to Section 8(g), the Selling Stockholders,
jointly and severally, agree to indemnify and hold harmless each Underwriter and
each person, if any, who controls any Underwriter within the meaning of the Act
against any losses, claims, damages or liabilities to which such Underwriter or
any such controlling person may become subject under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of or are based upon (i) any untrue
statement or alleged untrue statement of any material fact contained in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
amendment or supplement thereto, or (ii) the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse upon demand each
Underwriter and each such controlling person for any legal or other expenses
reasonably incurred by such Underwriter or such controlling person in connection
with investigating or defending any such loss, claim, damage, liability, action
or proceeding or in responding to a subpoena or governmental inquiry related to
the offering of the Shares (other than with respect to a governmental inquiry
targeted at or relating to any Underwriter or any person who controls any
Underwriter), whether or not such Underwriter or controlling person is a party
to any action or proceeding; provided, however, that the Company and the Selling
Stockholders will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement, or omission or alleged omission, made in
the Registration Statement, any Preliminary Prospectus, the Prospectus, or such
amendment or supplement, in reliance upon and in conformity with written
information furnished to the Company by or through the Representatives
specifically for use in the preparation thereof; and provided further, that the
Company and the Selling Stockholders shall not be liable to any Underwriter
under this Section 8(a) with respect to any untrue statement of a material fact
contained in, or the omission of a material fact from, any Preliminary
Prospectus which untrue statement or omission was corrected in the Prospectus,
if such Underwriter sold Shares to a person to whom there was not sent or given,
at or prior to the written confirmation of such sale, a copy of the Prospectus.
This indemnity agreement will be in addition to any liability which the Company
or the Selling Stockholders may otherwise have.
(b) Each Underwriter severally and not jointly will indemnify and hold
harmless the Company, each of its directors, each of its officers who have
signed the Registration Statement, the Selling Stockholders, and each person, if
any, who controls the Company or the Selling Stockholders within the meaning of
the Act, against any losses, claims, damages or liabilities to which the Company
or any such director, officer, Selling Stockholder or controlling person may
become subject under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, any Preliminary
Prospectus, the Prospectus or any amendment or supplement thereto, or arise out
of or are based upon the omission or the alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances under which they were
made; and will reimburse any legal or other expenses reasonably incurred by the
Company or any such director, officer, Selling Stockholder or controlling person
in connection with investigating or defending any such loss, claim, damage,
liability, action or proceeding; provided, however, that each Underwriter will
be liable in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission has been
made in the Registration Statement, any Preliminary Prospectus, the Prospectus
or such amendment or supplement,
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in reliance upon and in conformity with written information furnished to the
Company by or through the Representatives specifically for use in the
preparation thereof. This indemnity agreement will be in addition to any
liability which such Underwriter may otherwise have.
(c) In case any proceeding (including any governmental investigation) shall
be instituted involving any person in respect of which indemnity may be sought
pursuant to this Section 8, such person (the "indemnified party") shall promptly
notify the person against whom such indemnity may be sought (the "indemnifying
party") in writing. No indemnification provided for in Section 8(a) or (b) shall
be available to any party who shall fail to give notice as provided in this
Section 8(c) if the party to whom notice was not given was unaware of the
proceeding to which such notice would have related and was prejudiced by the
failure to give such notice, but the failure to give such notice shall not
relieve the indemnifying party or parties from any liability which it or they
may have to the indemnified party for contribution or otherwise than on account
of the provisions of Section 8(a) or (b). In case any such proceeding shall be
brought against any indemnified party and it shall notify the indemnifying party
of the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof, with
counsel selected by such indemnifying party and reasonably satisfactory to such
indemnified party. After notice from the indemnifying party to the indemnified
party of its election to assume the defense of such claim or action, the
indemnifying party shall not be liable to the indemnified party for any legal or
other expenses subsequently incurred by the indemnified party in connection with
the defense thereof other than reasonable costs of investigations; except that
if the indemnifying party or parties reasonably determine that there is or may
be a conflict between the positions of the indemnifying party or parties and of
the indemnified party or parties in conducting the defense of such action, suit,
investigation, inquiry or proceeding or that there is or may be legal defenses
available to such indemnified party or parties different from or in addition to
those available to the indemnifying party or parties, then counsel for the
indemnified party or parties shall be entitled to conduct the defense to the
extent reasonably determined by such counsel or by such indemnified party or
parties to be necessary to protect the interests of the indemnified party or
parties, and in that event the fees and expenses of such counsel for the
indemnified party or parties shall be paid by the indemnifying parties. It is
understood that the indemnifying party shall not, in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for the
reasonable fees and expenses of more than one separate firm for all such
indemnified parties. Such firm shall be designated in writing by you in the case
of parties indemnified pursuant to Section 8(a) and by the Company and the
Selling Stockholders in the case of parties indemnified pursuant to Section
8(b). The indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent but if settled with such consent
or if there be a final judgment for the plaintiff, the indemnifying party agrees
to indemnify the indemnified party from and against any loss or liability by
reason of such settlement or judgment. In addition, the indemnifying party will
not, without the prior written consent of the indemnified party, settle or
compromise or consent to the entry of any judgment in any pending or threatened
claim, action or proceeding for which indemnification has been sought hereunder
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action
or proceeding.
(d) If the indemnification provided for in this Section 8 is unavailable to
or insufficient to hold harmless an indemnified party under Section 8(a) or (b)
above in respect of any losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) referred to therein, then, subject to Section
8(g), each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a
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result of such losses, claims, damages or liabilities (or actions or proceedings
in respect thereof) in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Selling Stockholders on the one hand
and the Underwriters on the other from the offering of the Shares. If, however,
the allocation provided by the immediately preceding sentence is not permitted
by applicable law or if indemnification is not available to the indemnified
party as a result of a failure by the indemnified party to give the notice
required under Section 8(c) above, then, subject to Section 8(g), each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company and the Selling
Stockholders on the one hand and the Underwriters on the other in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities (or actions or proceedings in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by the
Company and the Selling Stockholders on the one hand and the Underwriters on the
other shall be deemed to be in the same proportion as the total net proceeds
from the offering (before deducting expenses) received by the Company and the
Selling Stockholders bear to the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in the table on the
cover page of the Prospectus. The 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 the Company or the Selling Stockholders on
the one hand or the Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company, the Selling Stockholders and the Underwriters agree that it
would not be just and equitable if contributions pursuant to this Section 8(d)
were determined by pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this Section
8(d). The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) referred to above in this Section 8(d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), (i) no Underwriter shall
be required to contribute any amount in excess of the underwriting discounts and
commissions applicable to the Shares purchased by such Underwriter and (ii) no
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations in
this Section 8(d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) In any proceeding relating to the Registration Statement, any
Preliminary Prospectus, the Prospectus or any supplement or amendment thereto,
each party against whom contribution may be sought under this Section 8 hereby
consents to the jurisdiction of any court having jurisdiction over any other
contributing party, agrees that process issuing from such court may be served
upon him or it by any other contributing party and consents to the service of
such process and agrees that any other contributing party may join him or it as
an additional defendant in any such proceeding in which such other contributing
party is a party.
(f) Except as otherwise expressly provided herein, any losses, claims,
damages, liabilities or expenses for which an indemnified party is entitled to
indemnification or contribution under this Xxxxxxx
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0 xxxxx xx paid by the indemnifying party to the indemnified party as such
losses, claims, damages, liabilities or expenses are incurred. Except as
otherwise expressly provided herein, the indemnity and contribution agreements
contained in this Section 8 and the representations and warranties of the
Company set forth in this Agreement shall remain operative and in full force and
effect, regardless of (i) any investigation made by or on behalf of any
Underwriter or any person controlling any Underwriter, the Company, its
directors or officers or any person controlling the Company, (ii) acceptance of
any Shares and payment therefor hereunder, and (iii) any termination of this
Agreement. A successor to any Underwriter, or to the Company, its directors or
officers, or any person controlling the Company, shall be entitled to the
benefits of the indemnity, contribution and reimbursement agreements contained
in this Section 8.
(g) In no event shall the liability for indemnification and/or contribution
under this Section 8 of (i) any Selling Stockholder identified in the Prospectus
under the caption "Principal and Selling Stockholders" as beneficially owning
more than five percent of the Company's Common Stock outstanding prior to the
sale of the Shares hereunder, including as a result of Common Stock held by
affiliates, exceed in the aggregate the proceeds received by such Selling
Stockholder from the Underwriters hereunder, and (ii) any other Selling
Stockholder exceed in the aggregate the lesser of (A) the proceeds received by
such Selling Stockholder from the Underwriters hereunder and (B) the product of
the total amount of losses, claims, damages and liabilities subject to
indemnification and/or contribution under this Section 8 multiplied by a
fraction the numerator of which is the number of Shares sold by such Selling
Stockholder hereunder and the denominator of which is the total number of Shares
sold hereunder.
9. DEFAULT BY UNDERWRITERS.
If on the Closing Date or the Option Closing Date, as the case may be, any
Underwriter shall fail to purchase and pay for the portion of the Shares which
such Underwriter has agreed to purchase and pay for on such date (otherwise than
by reason of any default on the part of the Company or a Selling Stockholder),
you, as Representatives of the Underwriters, shall use your best efforts to
procure within 36 hours thereafter one or more of the other Underwriters, or any
others, to purchase from the Company and the Selling Stockholders such amounts
as may be agreed upon and upon the terms set forth herein, the Firm Shares or
Option Shares, as the case may be, which the defaulting Underwriter or
Underwriters failed to purchase. If during such 36 hours you, as such
Representatives, shall not have procured such other Underwriters, or any others,
to purchase the Firm Shares or Option Shares, as the case may be, agreed to be
purchased by the defaulting Underwriter or Underwriters, then (a) if the
aggregate number of shares with respect to which such default shall occur does
not exceed 10% of the Firm Shares or Option Shares, as the case may be, covered
hereby, the other Underwriters shall be obligated, severally, in proportion to
the respective numbers of Firm Shares or Option Shares, as the case may be,
which they are obligated to purchase hereunder, to purchase the Firm Shares or
Option Shares, as the case may be, which such defaulting Underwriter or
Underwriters failed to purchase, or (b) if the aggregate number of shares of
Firm Shares or Option Shares, as the case may be, with respect to which such
default shall occur exceeds 10% of the Firm Shares or Option Shares, as the case
may be, covered hereby, the Company and the Selling Stockholders or you as the
Representatives of the Underwriters will have the right, by written notice given
within the next 36-hour period to the parties to this Agreement, to terminate
this Agreement without liability on the part of the non-defaulting Underwriters
or of the Company or of the Selling Stockholders except to the extent provided
in Section 8 hereof. In the event of a default by any Underwriter or
Underwriters, as set forth in this Section 9, the Closing Date or Option Closing
Date, as the case may be,
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may be postponed for such period, not exceeding seven days, as you, as
Representatives, may determine in order that the required changes in the
Registration Statement or in the Prospectus or in any other documents or
arrangements may be effected. The term "Underwriter" includes any person
substituted for a defaulting Underwriter. Any action taken under this Section 9
shall not relieve any defaulting Underwriter from liability in respect of any
default of such Underwriter under this Agreement.
10. NOTICES.
All communications hereunder shall be in writing and, except as otherwise
provided herein, will be mailed, delivered, telecopied or telegraphed and
confirmed as follows: if to the Underwriters, to BT Alex. Xxxxx Incorporated,
000 Xxxx Xxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, Attention: Legal
Department (telecopier (000) 000-0000), with a copy to Xxxxxx X. Xxxxx, Esq.,
Ropes & Xxxx, Xxx Xxxxxxxxxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 (telecopier
(000) 000-0000); and if to the Company or the Selling Stockholders, to Security
Dynamics Technologies, Inc., 00 Xxxxxx Xxxxx, Xxxxxxx, Xxxxxxxxxxxxx 00000,
Attention: Chief Executive Officer, (telecopier (000) 000-0000) with a copy to
Xxx X. Xxxxxxxxx, Esq., Xxxx and Xxxx LLP, 00 Xxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000 (telecopier (000) 000-0000).
11. TERMINATION.
This Agreement may be terminated by you by notice to the Sellers as
follows:
(a) at any time prior to the earlier of (i) the time the Shares are
released by you for sale by notice to the Underwriters, or (ii) 11:30 a.m. on
the date of this Agreement;
(b) at any time prior to the Closing Date if any of the following has
occurred: (i) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change or any
development involving a prospective material adverse change in or affecting the
condition, financial or otherwise, of the Company and its Subsidiaries taken as
a whole or the earnings, business, management, condition (financial or
otherwise) or business prospects of the Company and its Subsidiaries taken as a
whole, whether or not arising in the ordinary course of business, (ii) any
outbreak or escalation of hostilities or declaration of war or national
emergency after the date hereof or other national or international calamity or
crisis or change in economic or political conditions if the effect of such
outbreak, escalation, declaration, emergency, calamity, crisis or change on the
financial markets of the United States would, in your reasonable judgment, make
it impracticable to market the Shares or to enforce contracts for the sale of
the Shares, (iii) suspension of trading in securities generally on the New York
Stock Exchange or the American Stock Exchange or limitation on prices (other
than limitations on hours or numbers of days of trading) for securities on
either exchange, (iv) the enactment, publication, decree or other promulgation
of any federal or state statute, regulation, rule or order of any court or other
governmental authority which in your reasonable opinion materially and adversely
affects or may materially and adversely affect the business or operations of the
Company and the Subsidiaries taken as a whole, (v) declaration of a banking
moratorium by either federal or New York State authorities, (vi) the suspension
of trading of the Company's Common Stock by the Commission or the Nasdaq
National Market, or (vii) the taking of any action by any federal, state or
local governmental body or agency in respect of its monetary or fiscal affairs
which in your reasonable opinion has a material adverse effect on the securities
markets in the United States; or
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(c) as provided in Sections 6 and 9 of this Agreement.
This Agreement also may be terminated by you, by notice to the Sellers, as
to any obligation of the Underwriters to purchase the Option Shares, upon the
occurrence at any time prior to the Option Closing Date of any of the events
described in subparagraph (b) above or as provided in Sections 6 and 9 of this
Agreement.
12. SUCCESSORS.
This Agreement has been and is made solely for the benefit of the
Underwriters, the Company and the Selling Stockholders and their respective
successors, executors, administrators, heirs and assigns, and the officers,
directors and controlling persons referred to herein, and no other person will
have any right or obligation hereunder. The term "successors" shall not include
any purchaser of the Shares merely because of such purchase.
13. INFORMATION PROVIDED BY UNDERWRITERS
The Company, the Selling Stockholders and the Underwriters acknowledge and
agree that the only information furnished or to be furnished by any Underwriter
to the Company for inclusion in any Prospectus or the Registration Statement
consists of the information set forth in the last paragraph on the front cover
page (insofar as such information relates to the Underwriters), legends required
by Item 502(d) of Regulation S-K under the Act and the information under the
caption "Underwriting" in the Prospectus.
14. MISCELLANEOUS.
This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
This Agreement shall be governed by, and construed in accordance with, the
laws of The Commonwealth of Massachusetts.
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If the foregoing letter is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Selling Stockholders, the
Company and the several Underwriters in accordance with its terms.
Very truly yours,
SECURITY DYNAMICS TECHNOLOGIES, INC.
By:
-----------------------------------------
President
Selling Stockholders listed on Schedule II
By:
-----------------------------------------
Attorney-in-Fact
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
BT ALEX. XXXXX INCORPORATED
BANCAMERICA XXXXXXXXX XXXXXXXX
XXXXX & COMPANY
As Representatives of the several
Underwriters listed on Schedule I
By: BT Alex. Xxxxx Incorporated
By:
-----------------------------------------
Authorized Officer
28
SCHEDULE I
SCHEDULE OF UNDERWRITERS
Number of Firm Shares
Underwriter to be Purchased
----------- ---------------------
BT Alex. Xxxxx Incorporated
BancAmerica Xxxxxxxxx Xxxxxxxx
Xxxxx & Company
---------
Total Underwriters 3,000,000
=========
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SCHEDULE II
SCHEDULE OF SELLING STOCKHOLDERS
Number of Firm Shares
Selling Stockholder to be Sold
------------------- ---------------------
D. Xxxxx Xxxxxx 220,000
Xxxxxxx X. Xxxxxxx, Xx. 150,000
Xxxx Xxxxx 350,000
Xxxx Xxxxxxxxx 190,000
Xxxxx Xxxx 100,000
Xxxxxx X. Xxxxxxxx, Xx. 45,000
Xxxxx Xxxx 109,006
Xxxxx X. Xxxx 109,200
Xxxxx Xxxxxx 131,000
Kairdos L.L.C. 30,000
Xxxxx X. Saris 5,794
Xxxx Xxxxx 20,000
Xxxxxx X. Xxxxxxxxx 5,000
Johan Borendal 98,000
Xxxxxx Xxxxxxxx 47,000
Xxxxx Xxxxxxxx 13,000
Elin Kempegard 27,500
Xxxx Kempegard 27,500
Xxx Xxxxx 27,500
Lotta Ljung 27,500
Xxxxx Xxxxx-Xxxxxxxx 27,500
Xxxxx Xxxxx-Xxxxxxxx 27,500
Xxxxxxxx Xxxxxxxxx 18,000
Xxxxx Xxxxxxxxx 18,000
Total 1,824,000
=========
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SCHEDULE III
SUBSIDIARIES
Subsidiary Name Jurisdiction of Organization
--------------- ----------------------------
SD Securities Corp. Massachusetts
SD Investments Corp. Massachusetts
Security Dynamics (France) S.A.R.L. France
Security Dynamics Technologies GmbH Germany
Security Dynamics International Pte. Ltd. Singapore
Security Dynamics Nordic A.S. Norway
RSA Data Security, Inc. Delaware
Nihon RSA Company, Ltd. Japan
RSA Technology Holdings, Inc. Delaware
DynaSoft AB Sweden
Securix, Inc. California
DynaSoft Ltd. U.K.
Dynamic Software AB Sweden
31
SCHEDULE IV
FOREIGN QUALIFICATIONS
California
Colorado
Connecticut
Florida
Georgia
Massachusetts
Minnesota
Missouri
New York
North Carolina
Ohio
Pennsylvania
Texas
Virginia