Exhibit 1.1
SYMBOL TECHNOLOGIES, INC.
- Shares of Common Stock
Underwriting Agreement
, 2004
------------------------
X.X. Xxxxxx Securities Inc.
As Representative of the
several Underwriters listed
in Schedule 1 hereto
c/o X.X. Xxxxxx Securities Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Symbol Technologies, Inc., a Delaware corporation (the "COMPANY"),
proposes to issue and sell to the several Underwriters listed in Schedule 1
hereto (the "UNDERWRITERS"), for whom you are acting as representative (the
"REPRESENTATIVE"), an aggregate of -- shares of common stock, par value $.01 per
share (the "COMMON STOCK"), of the Company (the "UNDERWRITTEN SHARES") and, at
the option of the Underwriters to cover over-allotments, if any, up to an
additional -- shares of Common Stock of the Company (the "OPTION SHARES"). The
Underwritten Shares and the Option Shares are herein referred to as the
"SHARES". The shares of Common Stock of the Company to be outstanding after
giving effect to the sale of the Shares are herein referred to as the "STOCK".
Pursuant to a Rights Agreement, dated as of August 13, 2001, between the Company
and The Bank of New York, as Rights Agent (the "RIGHTS AGREEMENT"), the Stock,
including the Shares, will have attached thereto rights (the "RIGHTS") to
purchase, for each Right held, one one-thousandth (subject to adjustment) of a
share of preferred stock (as defined in the Rights Agreement), upon certain
terms and conditions.
The Company hereby confirms its agreement with the several Underwriters
concerning the purchase and sale of the Shares, as follows:
1. Registration Statement. The Company has prepared and filed with the
Securities and Exchange Commission (the "COMMISSION") under the Securities Act
of 1933, as amended, and the rules and regulations of the Commission thereunder
(collectively, the "SECURITIES ACT"), a registration statement on Form S-1 (File
No. 333-119076), including a prospectus, relating to the Shares and Rights. Such
registration statement, as amended at the time it becomes effective, including
the information, if any, deemed pursuant to Rule 430A under the Securities Act
to be part of the registration statement at the time of its effectiveness ("RULE
430 INFORMATION"), is
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referred to herein as the "REGISTRATION Statement"; and as used herein, the term
"PRELIMINARY PROSPECTUS" means each prospectus included in such registration
statement (and any amendments thereto) before it becomes effective and delivered
to prospective purchasers of the Shares, any prospectus filed with the
Commission pursuant to Rule 424(a) under the Securities Act and the prospectus
included in the Registration Statement at the time of its effectiveness that
omits Rule 430A Information, and the term "PROSPECTUS" means the prospectus in
the form first used to confirm sales of the Shares. If the Company has filed an
abbreviated registration statement pursuant to Rule 462(b) under the Securities
Act (the "RULE 462 REGISTRATION STATEMENT"), then any reference herein to the
term "REGISTRATION STATEMENT" shall be deemed to include such Rule 462
Registration Statement. Capitalized terms used but not defined herein shall have
the meanings given to such terms in the Registration Statement and the
Prospectus.
2. Purchase of the Shares by the Underwriters. (a) The Company agrees to
issue and sell the Shares to the several Underwriters as provided in this
Agreement, and each Underwriter, on the basis of the representations, warranties
and agreements set forth herein and subject to the conditions set forth herein,
agrees, severally and not jointly, to purchase from the Company the respective
number of Underwritten Shares set forth opposite such Underwriter's name in
Schedule 1 hereto at a price per share of $-- (the "PURCHASE PRICE"). The public
offering price of the Shares is not in excess of the price recommended by Bear,
Xxxxxxx & Co. Inc., acting as a "qualified independent underwriter" within the
meaning of Rule 2720 of the Rules of Conduct of the National Association of
Securities Dealers, Inc.
In addition, the Company agrees to issue and sell the Option Shares to the
several Underwriters as provided in this Agreement, and the Underwriters, on the
basis of the representations, warranties and agreements set forth herein and
subject to the conditions set forth herein, shall have the option to purchase,
severally and not jointly, from the Company the Option Shares at the Purchase
Price to cover over-allotments, if any.
If any Option Shares are to be purchased, the number of Option Shares to
be purchased by each Underwriter shall be the number of Option Shares which
bears the same ratio to the aggregate number of Option Shares being purchased as
the number of Underwritten Shares set forth opposite the name of such
Underwriter in Schedule 1 hereto (or such number increased as set forth in
Section 9 hereof) bears to the aggregate number of Underwritten Shares being
purchased from the Company by the several Underwriters, subject, however, to
such adjustments to eliminate any fractional Shares as the Representative in its
sole discretion shall make.
The Underwriters may exercise the option to purchase the Option Shares at
any time in whole, or from time to time in part, on or before the thirtieth day
following the date of this Agreement, by written notice from the Representative
to the Company. Such notice shall set forth the aggregate number of Option
Shares as to which the option is being exercised and the date and time when the
Option Shares are to be delivered and paid for which may be the same date and
time as the Closing Date (as hereinafter defined) but shall not be earlier than
the Closing Date nor later than the tenth full business day (as hereinafter
defined) after the date of such notice (unless such time and date are postponed
in accordance with the provisions of Section 9 hereof).
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Any such notice shall be given at least three Business Days prior to the date
and time of delivery specified therein unless otherwise agreed by the parties
hereto.
(b) The Company understands that the Underwriters intend to make a public
offering of the Shares as soon after the effectiveness of this Agreement as in
the judgment of the Representative is advisable, and initially to offer the
Shares on the terms set forth in the Prospectus. The Company acknowledges and
agrees that the Underwriters may offer and sell Shares to or through any
affiliate of an Underwriter and that any such affiliate may offer and sell
Shares purchased by it to or through any Underwriter.
(c) Payment for the Shares shall be made by wire transfer in immediately
available funds to the account specified by the Company to the Representative in
the case of the Underwritten Shares, at the offices of Xxxxx Xxxx & Xxxxxxxx at
10:00 A.M. New York City time on , 2004, or at such other time or place on the
same or such other date, not later than the fifth business day thereafter, as
the Representative and the Company may agree upon in writing or, in the case of
the Option Shares, on the date and at the time and place specified by the
Representative in the written notice of the Underwriters' election to purchase
such Option Shares. The time and date of such payment for the Underwritten
Shares is referred to herein as the "CLOSING DATE" and any time and date for
such payment for the Option Shares, if other than the Closing Date, are herein
referred to as an "ADDITIONAL CLOSING DATE".
Payment for the Shares to be purchased on the Closing Date or an
Additional Closing Date, as the case may be, shall be made against delivery to
the Representative for the respective accounts of the several Underwriters of
the Shares to be purchased on such date in definitive form registered in such
names and in such denominations as the Representative shall request in writing
not later than two full business days prior to the Closing Date or an Additional
Closing Date, as the case may be, with any transfer taxes payable in connection
with the sale of the Shares duly paid by the Company. The delivery of the Shares
will be made through the facilities of the Depository Trust Company on the
Closing Date or an Additional Closing Date, as the case may be.
3. Representations and Warranties of the Company. The Company represents
and warrants to each Underwriter that:
(a) Preliminary Prospectus. No order preventing or suspending the use of
any Preliminary Prospectus has been issued by the Commission.
(b) Registration Statement and Prospectus. The Registration Statement has
been declared effective by the Commission. No order suspending the effectiveness
of the Registration Statement has been issued by the Commission and no
proceeding for that purpose has been initiated or threatened by the Commission;
as of the applicable effective date of the Registration Statement and any
amendment thereto, the Registration Statement complied and will comply in all
material respects with the Securities Act, and did not and will not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary in order to make the statements therein not
misleading; and as of the applicable filing
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date of the Prospectus and any amendment or supplement thereto and as of the
Closing Date and as of each Additional Closing Date, as the case may be, the
Prospectus will not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; provided that the Company makes no representation and
warranty with respect to any statements or omissions made in reliance upon and
in conformity with information relating to any Underwriter furnished to the
Company in writing by such Underwriter through the Representative expressly for
use in the Registration Statement and the Prospectus and any amendment or
supplement thereto.
(c) Financial Statements. The financial statements and the related notes
thereto of the Company and its consolidated subsidiaries and the financial
statements and the related notes thereto of Matrics, Inc., in each case included
in the Registration Statement and the Prospectus comply in all material respects
with the applicable requirements of the Securities Act and the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "EXCHANGE ACT"), as applicable, and
present fairly the respective financial position of each of the Company and its
subsidiaries and Matrics, Inc. as of the dates indicated and the results of
their respective operations and the changes in their respective cash flows for
the periods specified; such financial statements have been prepared in
conformity with generally accepted accounting principles applied on a consistent
basis throughout the periods covered thereby; the other financial information
included in the Registration Statement and the Prospectus has been derived from
the respective accounting records of the Company and its subsidiaries and
Matrics, Inc. and presents fairly the information shown thereby; and the pro
forma financial information and the related notes thereto included in the
Registration Statement and the Prospectus has been prepared in accordance with
the applicable requirements of the Securities Act and the Exchange Act, as
applicable, and the assumptions underlying such pro forma financial information
are reasonable and are set forth in the Registration Statement and the
Prospectus, in each case, in all material respects.
(d) No Material Adverse Change. Since the date of the most recent
financial statements of the Company included in the Registration Statement and
the Prospectus, (i) there has not been any material change in the capital stock
or long-term debt of the Company or any of its subsidiaries, or any dividend or
distribution of any kind declared, set aside for payment, paid or made by the
Company on any class of capital stock, or any material adverse change in or
affecting the business, properties, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole; (ii) except as otherwise disclosed in the
Prospectus, neither the Company nor any of its subsidiaries has entered into any
transaction or agreement, outside the ordinary course of business, that is
material to the Company and its subsidiaries taken as a whole or incurred any
liability or obligation, direct or contingent, that is material to the Company
and its subsidiaries taken as a whole; and (iii) neither the Company nor any of
its subsidiaries has sustained any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not covered
by insurance, or from any labor disturbance or dispute or any action, order or
decree of any court or arbitrator or governmental or regulatory authority,
except in each case as otherwise disclosed in the Registration Statement and the
Prospectus.
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(e) Organization and Good Standing. The Company and each of its domestic
significant subsidiaries have been duly organized and are validly existing and
in good standing under the laws of their respective jurisdictions of
organization, in the case of each domestic significant subsidiary, are duly
qualified to do business and are in good standing in each jurisdiction in which
their respective ownership or lease of property or the conduct of their
respective businesses requires such qualification, and the Company and each of
its domestic significant subsidiaries have all power and authority necessary to
own or hold their respective properties and to conduct the businesses in which
they are engaged, except where the failure to be so qualified or have such power
or authority would not, individually or in the aggregate, have a material
adverse effect on the business, properties, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole (a "MATERIAL ADVERSE EFFECT"). The Company does
not own or control, directly or indirectly, any corporation, association or
other entity other than the subsidiaries listed in Exhibit 21 to the
Registration Statement. The subsidiaries listed in Schedule 2 to this Agreement
are the only significant subsidiaries of the Company.
(f) Capitalization. The Company has an authorized capitalization as set
forth in the Prospectus under the heading "CAPITALIZATION"; all the outstanding
shares of capital stock of the Company have been duly and validly authorized and
issued and are fully paid and non-assessable and are not subject to any
pre-emptive or similar rights; except as described in or expressly contemplated
by the Prospectus, there are no outstanding rights (including, without
limitation, pre-emptive rights), warrants or options to acquire, or instruments
convertible into or exchangeable for, any shares of capital stock or other
equity interest in the Company or any of its subsidiaries, or any contract,
commitment, agreement, understanding or arrangement of any kind relating to the
issuance of any capital stock of the Company or any such subsidiary, any such
convertible or exchangeable securities or any such rights, warrants or options;
the capital stock of the Company conforms in all material respects to the
description thereof contained in the Registration Statement and the Prospectus;
and all the outstanding shares of capital stock or other equity interests of
each subsidiary of the Company have been duly and validly authorized and issued,
are fully paid and non-assessable (except, in the case of any foreign
subsidiary, for directors' qualifying shares and except as otherwise described
in the Prospectus) and are owned directly or indirectly by the Company, free and
clear of any lien, charge, encumbrance, security interest, restriction on voting
or transfer or any other claim of any third party (collectively, the "LIENS"),
except for Liens the foreclosure of which would not have a Material Adverse
Effect.
(g) Due Authorization. The Company has full right, power and authority to
execute and deliver this Agreement and to perform its obligations hereunder; and
all action required to be taken for the consummation of the offering
contemplated hereby has been duly and validly taken.
(h) Underwriting Agreement. This Agreement has been duly authorized,
executed and delivered by the Company.
(i) The Shares. The Shares to be issued and sold by the Company hereunder
have been duly authorized by the Company and, when issued and delivered and paid
for as provided herein, will be duly and validly issued and will be fully paid
and non-assessable and will conform to the
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descriptions thereof in the Prospectus; and the issuance of the Shares is not
subject to any preemptive or similar rights; the Rights Agreement has been duly
authorized, executed and delivered by the Company and constitutes a valid and
legally binding agreement of the Company enforceable against the Company in
accordance with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency or similar laws affecting creditors' rights generally or
by equitable principles relating to enforceability; and the Rights have been
duly authorized by the Company and, when issued upon issuance of the Shares,
will be validly issued, and the poison pill security has been duly authorized by
the Company and validly reserved for issuance upon the exercise in accordance
with the terms of the Rights Agreement, will be validly issued, fully paid and
non-assessable.
(j) No Violation or Default. Neither the Company nor any of its
significant subsidiaries is (i) in violation of its charter or by-laws or
similar organizational documents; (ii) in default, and no event has occurred
that, with notice or lapse of time or both, would constitute such a default, in
the due performance or observance of any term, covenant or condition contained
in any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its significant subsidiaries is a
party or by which the Company or any of its significant subsidiaries is bound or
to which any of the property or assets of the Company or any of its significant
subsidiaries is subject (including, but not limited to, the Credit Agreement
among the Company, Fleet National Bank, as administrative agent, and the lenders
party thereto, dated as of November 17, 2003, as amended); or (iii) in violation
of any law or statute or any judgment, order, rule or regulation of any court or
arbitrator or governmental or regulatory authority, except, in the case of
clauses (ii) and (iii) above, for any such default or violation that would not,
individually or in the aggregate, have a Material Adverse Effect.
(k) No Conflicts. The execution, delivery and performance by the Company
of this Agreement and the issuance and sale of the Shares will not (i) conflict
with or result in a breach or violation of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any of its
significant subsidiaries pursuant to, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the Company or any of
its significant subsidiaries is a party or by which the Company or any of its
significant subsidiaries is bound or to which any of the property or assets of
the Company or any of its significant subsidiaries is subject, (ii) result in
any violation of the provisions of the charter or by-laws or similar
organizational documents of the Company or any of its significant subsidiaries
or (iii) result in the violation of any law or statute or any judgment, order,
rule or regulation of any court or arbitrator or governmental or regulatory
authority applicable to the Company or any of its significant subsidiaries,
except in the case of clauses (i) and (iii) above for such conflicts or
violations that would not have a Material Adverse Effect.
(l) No Consents Required. No consent, approval, authorization, order,
registration or qualification (collectively, "CONSENTS") of or with any court or
arbitrator or governmental or regulatory authority is required for the
execution, delivery and performance by the Company of this Agreement and the
issuance and sale of the Shares, except for the registration of the Shares under
the Securities Act, such Consents as may be required by the New York Stock
Exchange
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(the "EXCHANGE") or under applicable state securities laws in connection with
the purchase and distribution of the Shares by the Underwriters and such
Consents the failure to obtain would not have a Material Adverse Effect.
(m) Legal Proceedings. Except as described in the Prospectus, there are no
legal, governmental or regulatory investigations, actions, suits or proceedings
pending to which the Company or, to the best knowledge of the Company, any of
its officers (or former officers), directors (or former directors) or
significant subsidiaries is or may be a party or to which any property of the
Company or any of its significant subsidiaries is or may be the subject that,
individually or in the aggregate, if determined adversely to the Company or any
of its significant subsidiaries, could reasonably be expected to have a Material
Adverse Effect or materially and adversely affect the ability of the Company to
perform its obligations under this Agreement; no such investigations, actions,
suits or proceedings are threatened or, to the best knowledge of the Company,
contemplated by any governmental or regulatory authority or threatened by
others; and (i) there are no current or pending legal, governmental or
regulatory actions, suits or proceedings that are required under the Securities
Act to be described in the Prospectus that are not so described and (ii) there
are no statutes, regulations or contracts or other documents that are required
under the Securities Act to be filed as exhibits to the Registration Statement
or described in the Registration Statement or the Prospectus that are not so
filed or described.
(n) Independent Accountants. Ernst & Young LLP are independent public
accountants with respect to the Company and its subsidiaries as required by the
Securities Act; Deloitte & Touche, LLP, who have certified certain statements of
the Company and its subsidiaries, were independent public accountants with
respect to the Company and its subsidiaries as required by the Securities Act at
the time of such certifications; and PricewaterhouseCoopers LLP, who have
certified certain financial statements of Matrics, Inc., were independent public
accountants with respect to Matrics, Inc. as required by the Securities Act at
the time of such certifications.
(o) Title to Real and Personal Property. The Company and its significant
subsidiaries have good and marketable title in fee simple to, or have valid
rights to lease or otherwise use, all items of real and personal property that
are material to the respective businesses of the Company and its significant
subsidiaries, in each case free and clear of all liens, encumbrances, claims and
defects and imperfections of title except those that (i) are described in the
Registration Statement and the Prospectus, (ii) do not materially interfere with
the use made and proposed to be made of such property by the Company and its
significant subsidiaries or (iii) could not reasonably be expected, individually
or in the aggregate, to have a Material Adverse Effect.
(p) Title to Intellectual Property. The Company and its subsidiaries own
or possess adequate rights to use all material patents, patent applications,
trademarks, service marks, trade names, trademark registrations, service xxxx
registrations, copyrights, licenses and know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential information,
systems or procedures) necessary for the conduct of their respective businesses;
and the conduct of their respective businesses (as presently conducted) will not
conflict in any material
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respect with any such rights of others, and the Company and its significant
subsidiaries have not received any notice of any claim of infringement or
conflict with any such rights of others, in each case except as otherwise
disclosed in the Prospectus.
(q) No Undisclosed Relationships. No relationship, direct or indirect,
exists between or among the Company or any of its subsidiaries, on the one hand,
and the directors, officers, stockholders, customers or suppliers of the Company
or any of its subsidiaries, on the other, that is required by the Securities Act
to be described in the Registration Statement and the Prospectus and that is not
so described.
(r) Investment Company Act. The Company is not and, after giving effect to
the offering and sale of the Shares and the application of the proceeds thereof
as described in the Prospectus, will not be required to register as an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended, and the rules and regulations of the Commission thereunder
(collectively, "INVESTMENT COMPANY ACT").
(s) Taxes. The Company and its subsidiaries have paid all federal, state,
local and foreign taxes and filed all tax returns required to be paid or filed
through the date hereof; and there is no tax deficiency that has been asserted
against the Company or any of its subsidiaries or any of their respective
properties or assets, in each case except as would not have a Material Adverse
Effect and except as otherwise disclosed in the Prospectus.
(t) Licenses and Permits. The Company and its subsidiaries possess all
licenses, certificates, permits and other authorizations issued by, and have
made all declarations and filings with, the appropriate federal, state, local or
foreign governmental or regulatory authorities that are necessary for the
ownership or lease of their respective properties or the conduct of their
respective businesses as described in the Registration Statement and the
Prospectus, except where the failure to possess or make the same would not,
individually or in the aggregate, have a Material Adverse Effect; and except as
described in the Prospectus, neither the Company nor any of its subsidiaries has
received notice of any revocation or modification of any such license,
certificate, permit or authorization or has any reason to believe that any such
license, certificate, permit or authorization will not be renewed in the
ordinary course, except as would not result in a Material Adverse Effect.
(u) No Labor Disputes. No material labor disturbance by or dispute with
employees of the Company or any of its subsidiaries exists or, to the best
knowledge of the Company, is contemplated or threatened.
(v) Compliance With Environmental Laws. The Company and its subsidiaries
(i) are in compliance with any and all applicable federal, state, local and
foreign laws, rules, regulations, decisions and orders relating to the
protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants (collectively, "ENVIRONMENTAL
LAWS"); (ii) have received and are in compliance with all permits, licenses or
other approvals required of them under applicable Environmental Laws to conduct
their respective businesses; and (iii) have not received notice of any actual or
potential liability for the investigation or remediation of any disposal or
release of hazardous or toxic substances or
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wastes, pollutants or contaminants, except in any such case for any such failure
to comply, or failure to receive required permits, licenses or approvals, or
liability as would not, individually or in the aggregate, have a Material
Adverse Effect.
(w) Compliance With ERISA. Each employee benefit plan, within the meaning
of Section 3(3) of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), that is maintained, administered or contributed to by the
Company or any of its affiliates for employees or former employees of the
Company and its affiliates has been maintained in compliance with its terms and
the requirements of any applicable statutes, orders, rules and regulations,
including but not limited to ERISA and the Internal Revenue Code of 1986, as
amended (the "CODE"); no prohibited transaction, within the meaning of Section
406 of ERISA or Section 4975 of the Code, has occurred with respect to any such
plan excluding transactions effected pursuant to a statutory or administrative
exemption; and for each such plan that is subject to the funding rules of
Section 412 of the Code or Section 302 of ERISA, no "accumulated funding
deficiency" as defined in Section 412 of the Code has been incurred, whether or
not waived, and the fair market value of the assets of each such plan (excluding
for these purposes accrued but unpaid contributions) exceeds the present value
of all benefits accrued under such plan determined using reasonable actuarial
assumptions; in each case, except as would not result in a Material Adverse
Effect.
(x) Accounting Controls. The Company and its subsidiaries maintain systems
of internal accounting controls sufficient to provide reasonable assurance that
(i) transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(y) Insurance. Except as otherwise disclosed in the Registration
Statement, the Company and its subsidiaries have insurance covering their
respective properties, operations, personnel and businesses, including title
insurance and business interruption insurance, which insurance is in amounts and
insures against such losses and risks as are adequate to protect the Company and
its subsidiaries and their respective businesses; and neither the Company nor
any of its subsidiaries has (i) received notice from any insurer or agent of
such insurer that capital improvements or other expenditures are required or
necessary to be made in order to continue such insurance or (ii) any reason to
believe that it will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage at reasonable cost from
similar insurers as may be necessary to continue its business.
(z) No Unlawful Payments. Neither the Company nor any of its subsidiaries
nor, to the best knowledge of the Company, any director, officer, agent,
employee or other person associated with or acting on behalf of the Company or
any of its subsidiaries has (i) used any corporate funds for any unlawful
contribution, gift, entertainment or other unlawful expense relating to
political activity; (ii) made any direct or indirect unlawful payment to any
foreign or domestic government
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official or employee from corporate funds; (iii) violated or is in violation of
any provision of the Foreign Corrupt Practices Act of 1977, as amended, and the
rules and regulations thereunder (the "FCPA"); or (iv) made any bribe, rebate,
payoff, influence payment, kickback or other unlawful payment.
(aa) Compliance with Money Laundering Laws. Except as would not have a
Material Adverse Effect, the operations of the Company and its subsidiaries are
and have been conducted at all times in compliance with applicable financial
recordkeeping and reporting requirements of the Currency and Foreign
Transactions Reporting Act of 1970, as amended, the money laundering statutes of
all jurisdictions, the rules and regulations thereunder and any related or
similar rules, regulations or guidelines, issued, administered or enforced by
any governmental agency (collectively, the "MONEY LAUNDERING LAWS") and no
action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or any of its
subsidiaries with respect to the Money Laundering Laws is pending or, to the
best knowledge of the Company, threatened.
(bb) No Sanctions by the Office of Foreign Assets Control. Except as would
not have a Material Adverse Effect, neither the Company nor any of its
subsidiaries nor, to the knowledge of the Company, any director, officer, agent,
employee or affiliate of the Company or any of its subsidiaries is currently
subject to any U.S. sanctions administered by the Office of Foreign Assets
Control of the U.S. Treasury Department ("OFAC"); and the Company will not
directly or indirectly use the proceeds of the offering, or lend, contribute or
otherwise make available such proceeds to any subsidiary, joint venture partner
or other person or entity, for the purpose of financing the activities of any
person currently subject to any U.S. sanctions administered by OFAC.
(cc) No Restrictions on Subsidiaries. No subsidiary of the Company is
currently prohibited, directly or indirectly, under any agreement or other
instrument to which it is a party or is subject, from paying any dividends to
the Company, from making any other distribution on such subsidiary's capital
stock, from repaying to the Company any loans or advances to such subsidiary
from the Company or from transferring any of such subsidiary's properties or
assets to the Company or any other subsidiary of the Company.
(dd) No Broker's Fees. Neither the Company nor any of its subsidiaries is
a party to any contract, agreement or understanding with any person (other than
this Agreement) that would give rise to a valid claim against the Company or any
of its subsidiaries or any Underwriter for a brokerage commission, finder's fee
or like payment in connection with the offering and sale of the Shares.
(ee) No Registration Rights. No person has the right to require the
Company or any of its subsidiaries to register any securities for sale under the
Securities Act by reason of the filing of the Registration Statement with the
Commission or the issuance and sale of the Shares.
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(ff) No Stabilization. The Company has not taken, directly or indirectly,
any action designed to or that could reasonably be expected to cause or result
in any stabilization or manipulation of the price of the Shares.
(gg) Business with Cuba. The Company has complied with all provisions of
Section 517.075, Florida Statutes (Chapter 92-198, Laws of Florida) relating to
doing business with the Government of Cuba or with any person or affiliate
located in Cuba.
(hh) Statistical and Market Data. Nothing has come to the attention of the
Company that has caused the Company to believe that the statistical and
market-related data included in the Registration Statement and the Prospectus is
not based on or derived from sources that are reliable and accurate in all
material respects.
(ii) Xxxxxxxx-Xxxxx Act. There is and has been no failure on the part of
the Company or any of the Company's directors or officers, in their capacities
as such, to comply with Section 402 of the Xxxxxxxx-Xxxxx Act of 2002 and the
related rules and regulations promulgated in connection therewith.
(jj) Document Production. The Company has provided to Xxxxx Xxxx &
Xxxxxxxx, counsel to the Underwriters, all material documents responsive to the
requests made by such counsel in connection with their due diligence review of
the Company and its subsidiaries and Matrics, Inc.
(kk) Securities and Exchange Commission Investigation. The Company has
complied in all material respects with all of its obligations under the Final
Consent Judgment of Permanent Injunction and Other Relief as to Defendant Symbol
Technologies, Inc., dated June 3, 2004 (the "SEC FINAL CONSENT").
(ll) U.S. Attorney's Investigation. The Company has complied in all
material respects with all of its obligations under the Agreement between Symbol
Technologies, Inc. and the U.S. Attorney's Office for the Eastern District of
New York, dated June 3, 2004 (the "U.S. ATTORNEY'S AGREEMENT").
(mm) No Affiliations With the National Association of Securities Dealers,
Inc. No officer, director or, to the knowledge of the Company, any five percent
or greater shareholder or any beneficial owner of the Company's unregistered
equity securities that were acquired during the 180-day period immediately
preceding the filing of the Registration Statement, has a direct or indirect
affiliation or association with any member of the National Association of
Securities Dealers, Inc.
4. Further Agreements of the Company. The Company covenants and agrees
with each Underwriter that:
(a) Effectiveness of the Registration Statement. The Company will file the
final Prospectus with the Commission within the time periods specified by Rule
424(b) and Rule
12
430A under the Securities Act and the Company will furnish copies of the
Prospectus to the Underwriters in New York City on the business day next
succeeding the date of this Agreement in such quantities as the Representative
may reasonably request.
(b) Delivery of Copies. The Company will deliver, without charge and upon
request, (i) to the Representative a conformed copy of the Registration
Statement as originally filed and each amendment thereto, in each case including
all exhibits and consents filed therewith; and (ii) to each Underwriter upon
request (A) a conformed copy of the Registration Statement as originally filed
(without exhibits) and (B) subject to Section 4(e) below, during the Prospectus
Delivery Period, as many copies of the Prospectus (including all amendments and
supplements thereto) as the Representative may reasonably request. As used
herein, the term "PROSPECTUS DELIVERY PERIOD" means such period of time after
the first date of the public offering of the Shares as in the written opinion of
counsel for the Underwriters a prospectus relating to the Shares is required by
law to be delivered in connection with sales of the Shares by any Underwriter or
dealer.
(c) Amendments or Supplements. Before filing any amendment or supplement
to the Registration Statement or the Prospectus, the Company will furnish to the
Representative and counsel for the Underwriters a copy of the proposed amendment
or supplement for review and will not file any such proposed amendment or
supplement to which the Representative reasonably objects promptly after receipt
thereof.
(d) Notice to the Representative. The Company will advise the
Representative promptly, and confirm such advice in writing, (i) when the
Registration Statement has become effective; (ii) when any amendment to the
Registration Statement has been filed or becomes effective; (iii) when any
supplement to the Prospectus or any amendment to the Prospectus has been filed;
(iv) of any request by the Commission for any amendment to the Registration
Statement or any amendment or supplement to the Prospectus or the receipt of any
comments from the Commission relating to the Registration Statement or any other
request by the Commission for any additional information; (v) of the issuance by
the Commission of any order suspending the effectiveness of the Registration
Statement or preventing or suspending the use of any Preliminary Prospectus or
the Prospectus or the initiation or threatening of any proceeding for that
purpose; (vi) of the occurrence of any event within the Prospectus Delivery
Period as a result of which the Prospectus as then amended or supplemented would
include any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances existing when the Prospectus is delivered to a purchaser, not
misleading; and (vii) of the receipt by the Company of any notice with respect
to any suspension of the qualification of the Shares for offer and sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose; and the Company will use all commercially reasonable efforts to prevent
the issuance of any such order suspending the effectiveness of the Registration
Statement, preventing or suspending the use of any Preliminary Prospectus or the
Prospectus or suspending any such qualification of the Shares and, if any such
order is issued, will use commercially reasonable efforts to obtain as soon as
practicable the withdrawal thereof.
13
(e) Ongoing Compliance of the Prospectus. If during the Prospectus
Delivery Period (i) any event shall occur or condition shall exist as a result
of which the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances existing when the Prospectus is delivered to a
purchaser, not misleading or (ii) if in the written opinion of counsel to the
Underwriters, it is necessary to amend or supplement the Prospectus to comply
with applicable law, the Company will as promptly as practicable notify the
Underwriters thereof and forthwith prepare and, subject to paragraph (c) above,
file with the Commission and furnish to the Underwriters and to such dealers as
the Representative may designate, such amendments or supplements to the
Prospectus as may be necessary so that the statements in the Prospectus as so
amended or supplemented will not, in the light of the circumstances existing
when the Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus will comply with applicable law; provided, that the preparation,
filing and furnishing of any such amendments or supplements on or prior to the
date that is nine months after the first public offering of the Shares shall be
at the expense of the Company and thereafter shall be at the expense of the
Underwriters.
(f) Blue Sky Compliance. The Company will qualify the Shares for offer and
sale under the securities or Blue Sky laws of such jurisdictions as the
Representative shall reasonably request and will continue such qualifications in
effect so long as required for distribution of the Shares; provided that the
Company shall not be required to (i) qualify as a foreign corporation or other
entity or as a dealer in securities in any such jurisdiction where it would not
otherwise be required to so qualify, (ii) file any general consent to service of
process in any such jurisdiction or (iii) subject itself to taxation in any such
jurisdiction if it is not otherwise so subject.
(g) Earnings Statement. The Company will make generally available to its
security holders and the Representative as soon as practicable an earnings
statement that satisfies the provisions of Section 11(a) of the Securities Act
and Rule 158 of the Commission promulgated thereunder covering a period of at
least twelve months beginning with the first fiscal quarter of the Company
occurring after the "effective date" (as defined in Rule 158) of the
Registration Statement.
(h) Clear Market. For a period of 90 days after the date of this
Agreement, the Company will not (i) offer, pledge, announce the intention to
sell, sell, contract to sell, sell any option or contract to purchase, purchase
any option or contract to sell, grant any option, right or warrant to purchase
or otherwise transfer or dispose of, directly or indirectly, any shares of Stock
or any securities convertible into or exercisable or exchangeable for Stock or
(ii) enter into any swap or other agreement that transfers, in whole or in part,
any of the economic consequences of ownership of the Stock, whether any such
transaction described in clause (i) or (ii) above is to be settled by delivery
of Stock or such other securities, in cash or otherwise, without the prior
written consent of the Representative, other than (i) the Shares to be sold
hereunder, (ii) any shares of Stock of the Company issued upon the exercise of
options granted under existing employee stock option plans, (iii) grants by the
Company of employee stock options or restricted stock pursuant to the terms of a
plan in effect on the date hereof, (iv) the filing by the Company of any
registration statement with the Commission on Form S-8 relating to the offering
of
14
securities pursuant to the terms of a plan in effect on the date hereof and (v)
shares of Stock (or options, warrants or convertible securities in respect
thereof) in connection with a bona fide merger or acquisition transaction
provided that the Stock (or options, warrants or convertible securities in
respect thereof) so issued is subject to the terms of the lock-up agreement
having the provisions that are substantially the same as those set forth in
Exhibit A. Notwithstanding the foregoing, if (1) during the last 17 days of the
90-day restricted period, the Company issues an earnings release or material
news or a material event relating to the Company occurs; or (2) prior to the
expiration of the 90-day restricted period, the Company announces that it will
release earnings results during the 16-day period beginning on the last day of
the 90-day period, the restrictions imposed by this Agreement shall continue to
apply until the expiration of the 18-day period beginning on the issuance of the
earnings release or the occurrence of the material news or material event.
(i) Use of Proceeds. The Company will apply the net proceeds from the sale
of the Shares as described in the Prospectus under the heading "Use of
Proceeds".
(j) No Stabilization. The Company will not take, directly or indirectly,
any action designed to or that could reasonably be expected to cause or result
in any stabilization or manipulation of the price of the Shares.
(k) Exchange Listing. The Company will use all commercially reasonable
efforts to list, subject to notice of issuance, the Shares on the Exchange.
(l) Reports. To the extent not available on XXXXX, for a period of two
years from the date hereof, the Company will furnish to the Representative, as
soon as they are available, copies of all reports or other communications
(financial or other) furnished to holders of the Shares, and copies of any
reports and financial statements furnished to or filed with the Commission or
any national securities exchange or automatic quotation system.
5. Conditions of Underwriters' Obligations. The obligation of each
Underwriter to purchase the Underwritten Shares on the Closing Date or the
Option Shares on the Additional Closing Date, as the case may be, as provided
herein is subject to the performance by the Company of its covenants and other
obligations hereunder and to the following additional conditions:
(a) Registration Compliance; No Stop Order. The Registration Statement (or
if a post-effective amendment thereto is required to be filed under the
Securities Act, such post-effective amendment) shall have become effective, and
the Representative shall have received notice thereof, not later than 5:00 P.M.,
New York City time, on the date hereof; no order suspending the effectiveness of
the Registration Statement shall be in effect, and no proceeding for such
purpose shall be pending before or threatened by the Commission; the Prospectus
shall have been timely filed with the Commission under the Securities Act and in
accordance with Section 4(a) hereof; and all requests by the Commission for
additional information shall have been complied with.
15
(b) Representations and Warranties. The representations and warranties of
the Company contained herein shall be true and correct on the date hereof and on
and as of the Closing Date or an Additional Closing Date, as the case may be;
and the statements of the Company and its officers made in any certificates
delivered pursuant to this Agreement shall be true and correct on and as of the
Closing Date or an Additional Closing Date, as the case may be.
(c) No Material Adverse Change. Subsequent to the execution and delivery
of this Agreement, no event or condition of a type described in Section 3(d)
hereof shall have occurred or shall exist, which event or condition is not
described in the Prospectus (excluding any amendment or supplement thereto) and
the effect of which in the judgment of the Representative makes it impracticable
or inadvisable to proceed with the offering, sale or delivery of the Shares on
the Closing Date or an Additional Closing Date, as the case may be, on the terms
and in the manner contemplated by this Agreement and the Prospectus.
(d) Officer's Certificate. The Representative shall have received on and
as of the Closing Date or the Additional Closing Date, as the case may be, a
certificate of the chief financial officer or chief accounting officer of the
Company and one additional senior executive officer of the Company who is
reasonably satisfactory to the Representative (i) confirming that such officers
have carefully reviewed the Registration Statement and the Prospectus and, to
the best knowledge of such officers, the representation set forth in Section
3(b) hereof is true and correct, (ii) confirming that the other representations
and warranties of the Company in this Agreement are true and correct and that
the Company has complied in all material respects with all agreements and
satisfied in all material respects all conditions on its part to be performed or
satisfied hereunder at or prior to such Closing Date and (iii) to the effect set
forth in paragraphs (a) and (c) above.
(e) Comfort Letters. On the date of this Agreement and on the Closing Date
and each Additional Closing Date, as the case may be, each of Ernst & Young LLP,
Deloitte & Touche, LLP and PricewaterhouseCoopers LLP shall have furnished to
the Representative, at the request of the Company, letters, dated the respective
dates of delivery thereof and addressed to the Underwriters, in form and
substance reasonably satisfactory to the Representative, containing statements
and information separately agreed between the Representative and each of Ernst &
Young LLP, Deloitte & Touche, LLP and PricewaterhouseCoopers LLP with respect to
the financial statements and certain financial information contained in the
Registration Statement and the Prospectus; provided, that the letter delivered
on the Closing Date or an Additional Closing Date, as the case may be, shall use
a "cut-off" date no more than three business days prior to such Closing Date or
such Additional Closing Date, as the case may be.
(f) Opinion of General Counsel for the Company. Xxxxx X. Xxxx, Esq.,
Senior Vice President, General Counsel and Secretary for the Company, shall have
furnished to the Representative, at the request of the Company, his written
opinion, dated the Closing Date and each Additional Closing Date, as the case
may be, and addressed to the Underwriters, in the form attached in Annex A
hereto.
16
(g) Opinion of Outside Counsel for the Company. Xxxxxx & Xxxxxxx LLP,
outside counsel for the Company, shall have furnished to the Representative, at
the request of the Company, their written opinion, dated the Closing Date and
each Additional Closing Date, as the case may be, and addressed to the
Underwriters, in the form attached in Annex B hereto.
(h) Opinion of Counsel for the Underwriters. The Representative shall have
received on and as of the Closing Date and each Additional Closing Date, as the
case may be, an opinion of Xxxxx Xxxx & Xxxxxxxx, counsel for the Underwriters,
with respect to such matters as the Representative may reasonably request, and
such counsel shall have received such documents and information as they may
reasonably request to enable them to pass upon such matters.
(i) No Legal Impediment to Issuance. No action shall have been taken and
no statute, rule, regulation or order shall have been enacted, adopted or issued
by any federal, state or foreign governmental or regulatory authority that
would, as of the Closing Date or an Additional Closing Date, as the case may be,
prevent the issuance or sale of the Shares; and no injunction or order of any
federal, state or foreign court shall have been issued that would, as of the
Closing Date or the Additional Closing Date, as the case may be, prevent the
issuance or sale of the Shares.
(j) Good Standing. The Representative shall have received on and as of the
Closing Date and each Additional Closing Date, as the case may be, satisfactory
evidence of the good standing of the Company and its domestic significant
subsidiaries in their respective jurisdictions of organization.
(k) Exchange Listing. The Shares to be delivered on the Closing Date or an
Additional Closing Date, as the case may be, shall have been approved for
listing on the Exchange, subject to official notice of issuance.
(l) Lock-up Agreements. The "lock-up" agreements, each substantially in
the form of Exhibit A hereto, between you and certain officers and directors of
the Company relating to sales and certain other dispositions of shares of Stock
or certain other securities, delivered to you on or before the date hereof,
shall be full force and effect on the Closing Date and any Additional Closing
Date, as the case may be.
(m) Additional Documents. On or prior to the Closing Date and each
Additional Closing Date, as the case may be, the Company shall have furnished to
the Representative such further certificates and documents as the Representative
may reasonably request.
All opinions, letters, certificates and evidence mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
6. Indemnification and Contribution.
(a) Indemnification of the Underwriters. The Company agrees to indemnify
and hold harmless each Underwriter, its affiliates, directors and officers and
each person, if any, who
17
controls such Underwriter within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act, from and against any and all losses, claims,
damages and liabilities (including, without limitation, reasonable legal fees
and other reasonable expenses incurred in connection with any suit, action or
proceeding or any claim asserted, as such fees and expenses are incurred), joint
or several, that arise out of, or are based upon, any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or the Prospectus (or any amendment or supplement thereto) or any
Preliminary Prospectus, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, except insofar as such losses, claims, damages or
liabilities arise out of, or are based upon, any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with any information relating to any Underwriter furnished to the Company in
writing by such Underwriter through the Representative expressly for use
therein, it being understood and agreed that the only such information furnished
by any Underwriter consists of the information described as such in subsection
(b) below. Notwithstanding the foregoing, this indemnity agreement is subject to
the condition that, insofar as it relates to any untrue statement or omission,
or any alleged untrue statement or omission, made in a Preliminary Prospectus
but corrected, eliminated or remedied in the Prospectus, or any amendment or
supplement thereto it shall not inure to the benefit of any Underwriter from
whom the person asserting the claim purchased the Shares (or to the benefit of
any person who controls such Underwriter within the meaning of Section 15 of the
Securities Act) if the Company had previously furnished copies of the Prospectus
or such amendment or supplement to such Underwriter.
The Company also agrees to indemnify and hold harmless Bear, Xxxxxxx & Co.
Inc., its affiliates, directors and officers and each person, if any, who
controls Bear, Xxxxxxx & Co. Inc. within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and all
losses, claims, damages and liabilities incurred as a result of Bear, Xxxxxxx &
Co. Inc.'s participation as a "qualified independent underwriter" within the
meaning of the Rules of Conduct of the National Association of Securities
Dealers, Inc. in connection with the offering of the Shares.
(b) Indemnification of the Company. Each Underwriter agrees, severally and
not jointly, to indemnify and hold harmless the Company, its directors, its
officers and each person, if any, who controls the Company within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act to the same
extent as the indemnity set forth in paragraph (a) above, but only with respect
to any losses, claims, damages or liabilities that arise out of, or are based
upon, any untrue statement or omission or alleged untrue statement or omission
made in reliance upon and in conformity with any information relating to such
Underwriter furnished to the Company in writing by such Underwriter through the
Representative expressly for use in the Registration Statement and the
Prospectus (or any amendment or supplement thereto) or any Preliminary
Prospectus, it being understood and agreed upon that the only such information
furnished by any Underwriter consists of the following information in the
Prospectus furnished on behalf of each Underwriter: the concession and
reallowance figures appearing in the third paragraph and the information
contained in the twelfth, thirteenth and fourteenth paragraphs
18
relating to stabilizing transactions and passive market making, and the
information in the fifteenth paragraph relating to a relationship one of the
underwriters has entered into with a third party, each under the caption
"Underwriting".
(c) Notice and Procedures. If any suit, action, proceeding (including any
governmental or regulatory investigation), claim or demand shall be brought or
asserted against any person in respect of which indemnification may be sought
pursuant to either paragraph (a) or (b) above, such person (the "INDEMNIFIED
PERSON") shall promptly notify the person against whom such indemnification may
be sought (the "INDEMNIFYING PERSON") in writing; provided that the failure to
notify the Indemnifying Person shall not relieve it from any liability that it
may have under this Section 6 except to the extent that it has been materially
prejudiced (through the forfeiture of substantive rights or defenses) by such
failure; and provided, further, that the failure to notify the Indemnifying
Person shall not relieve it from any liability that it may have to an
Indemnified Person otherwise than under this Section 6. If any such proceeding
shall be brought or asserted against an Indemnified Person and it shall have
notified the Indemnifying Person thereof, the Indemnifying Person shall retain
counsel reasonably satisfactory to the Indemnified Person to represent the
Indemnified Person and any others entitled to indemnification pursuant to this
Section 6 that the Indemnifying Person may designate in such proceeding and
shall pay the fees and expenses of such counsel related to such proceeding, as
incurred. In any such proceeding, any Indemnified Person shall have the right to
retain its own counsel, but the fees and expenses of such counsel shall be at
the expense of such Indemnified Person unless (i) the Indemnifying Person and
the Indemnified Person shall have mutually agreed to the contrary; (ii) the
Indemnifying Person has failed within a reasonable time to retain counsel
reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person
shall have reasonably concluded that there may be legal defenses available to it
that are different from or in addition to those available to the Indemnifying
Person; or (iv) the named parties in any such proceeding (including any
impleaded parties) include both the Indemnifying Person and the Indemnified
Person and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them. It is
understood and agreed that the Indemnifying Person shall not, in connection with
any proceeding or related proceeding in the same jurisdiction, be liable for the
fees and expenses of more than one separate firm (in addition to any local
counsel) for all Indemnified Persons, and that all such fees and expenses shall
be paid or reimbursed as they are incurred; provided, however that if indemnity
may be sought pursuant to the second paragraph of 6(a) above in respect of such
proceeding, then in addition to such separate firm of the Underwriters, their
affiliates and such control persons of the Underwriters the indemnifying party
shall be liable for the fees and expenses of not more than one separate firm (in
addition to any local counsel) for Bear, Xxxxxxx & Co. Inc. in its capacity as a
"qualified independent underwriter", its affiliates and all persons, if any, who
control Bear, Xxxxxxx & Co. Inc. within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act. Any such separate firm for any
Underwriter, its affiliates, directors and officers and any control persons of
such Underwriter shall be designated in writing by the Representative and any
such separate firm for the Company, its directors, its officers and any control
persons of the Company shall be designated in writing by the Company. The
Indemnifying Person 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 Person agrees to
19
indemnify each Indemnified Person from and against any loss or liability by
reason of such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time an Indemnified Person shall have requested in writing that an
Indemnifying Person reimburse the Indemnified Person for fees and expenses of
counsel as contemplated by this paragraph, the Indemnifying Person shall be
liable for any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than 30 days after receipt by the
Indemnifying Person of such request and (ii) the Indemnifying Person shall not
have reimbursed the Indemnified Person in accordance with such request prior to
the date of such settlement. No Indemnifying Person shall, without the written
consent of the Indemnified Person, effect any settlement of any pending or
threatened proceeding in respect of which any Indemnified Person is or could
have been a party and indemnification could have been sought hereunder by such
Indemnified Person, unless such settlement (x) includes an unconditional release
of such Indemnified Person, in form and substance reasonably satisfactory to
such Indemnified Person, from all liability on claims that are the subject
matter of such proceeding and (y) does not include any statement as to or any
admission of fault, culpability or a failure to act by or on behalf of any
Indemnified Person.
(d) Contribution. If the indemnification provided for in paragraphs (a)
and (b) above is unavailable to an Indemnified Person or insufficient in respect
of any losses, claims, damages or liabilities referred to therein, then each
Indemnifying Person under such paragraph, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or payable by
such Indemnified Person as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriters or Bear,
Xxxxxxx & Co. Inc. in its capacity as a "qualified independent underwriter", as
the case may be, on the other from the offering of the Shares or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) but also the relative fault of the Company on the one hand and
the Underwriters or Bear, Xxxxxxx & Co. Inc. in its capacity as a "qualified
independent underwriter", as the case may be, on the other in connection with
the statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the Underwriters
or Bear, Xxxxxxx & Co. Inc. in its capacity as a "qualified independent
underwriter", as the case may be, on the other shall be deemed to be in the same
respective proportions as the net proceeds (before deducting expenses) received
by the Company from the sale of the Shares and the total underwriting discounts
and commissions received by the Underwriters in connection therewith, in each
case as set forth in the table on the cover of the Prospectus, or the fee to be
received by Bear, Xxxxxxx & Co. Inc. in its capacity as a "qualified independent
underwriter", as the case may be, bear to the aggregate offering price of the
Shares. The relative fault of the Company on the one hand and the Underwriters
or Bear, Xxxxxxx & Co. Inc. in its capacity as a "qualified independent
underwriter", as the case may be, on the other 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 by the Underwriters or Bear,
Xxxxxxx & Co. Inc. in its capacity as a "qualified independent underwriter", as
the case may be, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
20
(e) Limitation on Liability. The Company and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this Section 6
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 that does not
take account of the equitable considerations referred to in paragraph (d) above.
The amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in paragraph (d) above shall be
deemed to include, subject to the limitations set forth above, any legal or
other expenses incurred by such Indemnified Person in connection with any such
action or claim. Notwithstanding the provisions of this Section 6, in no event
shall an Underwriter be required to contribute any amount in excess of the
amount by which the total underwriting discounts and commissions received by
such Underwriter with respect to the offering of the Shares exceeds the amount
of any damages that such Underwriter has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute pursuant to this Section 6 are several
in proportion to their respective purchase obligations hereunder and not joint.
(f) Non-Exclusive Remedies. The remedies provided for in this Section 6
are not exclusive and shall not limit any rights or remedies which may otherwise
be available to any Indemnified Person at law or in equity.
7. Effectiveness of Agreement. This Agreement shall become effective upon
the execution and delivery hereof by the parties hereto.
8. Termination. This Agreement may be terminated in the absolute
discretion of the Representative, by written notice to the Company, if after the
execution and delivery of this Agreement and prior to the Closing Date or, in
the case of the Option Shares, prior to an Additional Closing Date (i) trading
generally shall have been suspended or materially limited on or by any of the
Exchange, the American Stock Exchange, the National Association of Securities
Dealers, Inc., the Chicago Board Options Exchange, the Chicago Mercantile
Exchange or the Chicago Board of Trade; (ii) trading of any securities issued or
guaranteed by the Company shall have been suspended on any exchange or in any
over-the-counter market; (iii) a general moratorium on commercial banking
activities shall have been declared by federal or New York State authorities; or
(iv) there shall have occurred any outbreak or escalation of hostilities or any
change in financial markets or any calamity or crisis, either within or outside
the United States, that, in the judgment of the Representative, is material and
adverse and makes it impracticable or inadvisable to proceed with the offering,
sale or delivery of the Shares on the Closing Date or an Additional Closing
Date, as the case may be, on the terms and in the manner contemplated by this
Agreement and the Prospectus.
9. Defaulting Underwriter. (a) If, on the Closing Date or an Additional
Closing Date, as the case may be, any Underwriter defaults on its obligation to
purchase the Shares that it has agreed to purchase hereunder on such date, the
non-defaulting Underwriters may in their discretion
21
arrange for the purchase of such Shares by other persons satisfactory to the
Company on the terms contained in this Agreement. If, within 36 hours after any
such default by any Underwriter, the non-defaulting Underwriters do not arrange
for the purchase of such Shares, then the Company shall be entitled to a further
period of 36 hours within which to procure other persons satisfactory to the
non-defaulting Underwriters to purchase such Shares on such terms. If other
persons become obligated or agree to purchase the Shares of a defaulting
Underwriter, either the non-defaulting Underwriters or the Company may postpone
the Closing Date or an Additional Closing Date, as the case may be, for up to
five full business days in order to effect any changes that in the opinion of
counsel for the Company or counsel for the Underwriters may be necessary in the
Registration Statement and the Prospectus or in any other document or
arrangement, and the Company agrees to promptly prepare any amendment or
supplement to the Registration Statement and the Prospectus that effects any
such changes. As used in this Agreement, the term "UNDERWRITER" includes, for
all purposes of this Agreement unless the context otherwise requires, any person
not listed in Schedule 1 hereto that, pursuant to this Section 9, purchases
Shares that a defaulting Underwriter agreed but failed to purchase.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by the non-defaulting
Underwriters and the Company as provided in paragraph (a) above, the aggregate
number of Shares that remain unpurchased on the Closing Date or an Additional
Closing Date, as the case may be does not exceed one-eleventh of the aggregate
number of Shares to be purchased on such date, then the Company shall have the
right to require each non-defaulting Underwriter to purchase the number of
Shares that such Underwriter agreed to purchase hereunder on such date plus such
Underwriter's pro rata share (based on the number of Shares that such
Underwriter agreed to purchase on such date) of the Shares of such defaulting
Underwriter or Underwriters for which such arrangements have not been made.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by the non-defaulting
Underwriters and the Company as provided in paragraph (a) above, the aggregate
number of Shares that remain unpurchased on the Closing Date or an Additional
Closing Date, as the case may be, exceeds one-eleventh of the aggregate amount
of Shares to be purchased on such date, or if the Company shall not exercise the
right described in paragraph (b) above, then this Agreement or, with respect to
any Additional Closing Date, the obligation of the Underwriters to purchase
Shares on such Additional Closing Date, as the case may be, shall terminate
without liability on the part of the non-defaulting Underwriters. Any
termination of this Agreement pursuant to this Section 9 shall be without
liability on the part of the Company, except that the Company will continue to
be liable for the payment of expenses as set forth in Section 10 hereof and
except that the provisions of Section 6 hereof shall not terminate and shall
remain in effect.
(d) Nothing contained herein shall relieve a defaulting Underwriter of any
liability it may have to the Company or any non-defaulting Underwriter for
damages caused by its default.
10. Payment of Expenses. (a) Whether or not the transactions contemplated
by this Agreement are consummated or this Agreement is terminated, the Company
will pay or cause to
22
be paid all costs and expenses incident to the performance of its obligations
hereunder, including without limitation, (i) the costs incident to the
authorization, issuance, sale, preparation and delivery of the Shares and any
taxes payable in that connection; (ii) the costs incident to the preparation,
printing and filing under the Securities Act of the Registration Statement, the
Preliminary Prospectus and the Prospectus (including all exhibits, amendments
and supplements thereto) and the distribution thereof; (iii) the fees and
expenses of the Company's counsel and independent accountants; (iv) the fees and
expenses incurred in connection with the registration or qualification and
determination of eligibility for investment of the Shares under the laws of such
jurisdictions as the Representative may designate and the preparation, printing
and distribution of a Blue Sky Memorandum (including the related fees and
expenses of counsel for the Underwriters); (v) the cost of preparing stock
certificates; (vi) the costs and charges of any transfer agent and any
registrar; (vii) all expenses and application fees incurred in connection with
any filing with, and clearance of the offering by, the National Association of
Securities Dealers, Inc. (including the fees and expenses of Bear, Xxxxxxx & Co.
Inc. acting as "qualified independent underwriter" within the meaning of the
aforementioned Rule 2720 of The Rules of Conduct; (viii) all expenses incurred
by the Company in connection with any "road show" presentation to potential
investors; and (ix) all expenses and application fees related to the listing of
the Shares on the Exchange.
(b) If (i) this Agreement is terminated pursuant to Section 8, (ii) the
Company for any reason fails to tender the Shares for delivery to the
Underwriters or (iii) the Underwriters decline to purchase the Shares for any
reason permitted under this Agreement, the Company agrees to reimburse the
Underwriters for all reasonable out-of-pocket costs and expenses (including the
reasonable fees and expenses of their counsel) reasonably incurred by the
Underwriters in connection with this Agreement and the offering contemplated
hereby.
11. Persons Entitled to Benefit of Agreement. This Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective
successors and the officers and directors and any controlling persons referred
to in Section 6 hereof. Nothing in this Agreement is intended or shall be
construed to give any other person any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision contained herein. No
purchaser of Shares from any Underwriter shall be deemed to be a successor
merely by reason of such purchase.
12. Survival. The respective indemnities, rights of contribution,
representations, warranties and agreements of the Company and the Underwriters
contained in this Agreement or made by or on behalf of the Company or the
Underwriters pursuant to this Agreement or any certificate delivered pursuant
hereto shall survive the delivery of and payment for the Shares and shall remain
in full force and effect, regardless of any termination of this Agreement or any
investigation made by or on behalf of the Company or the Underwriters.
13. Certain Defined Terms. For purposes of this Agreement, (a) except
where otherwise expressly provided, the term "AFFILIATE" has the meaning set
forth in Rule 405 under the Securities Act; (b) the term "BUSINESS DAY" means
any day other than a day on which banks are permitted or required to be closed
in New York City; (c) the term "SUBSIDIARY" has the meaning set
23
forth in Rule 405 under the Securities Act; and (d) the term "SIGNIFICANT
SUBSIDIARY" has the meaning set forth in Rule 1-02 of Regulation S-X of the
Exchange Act.
14. Miscellaneous. (a) Authority of the Representative. Any action by the
Underwriters hereunder may be taken by X.X. Xxxxxx Securities Inc. on behalf of
the Underwriters, and any such action taken by X.X. Xxxxxx Securities Inc. shall
be binding upon the Underwriters.
(b) Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed or transmitted and
confirmed by any standard form of telecommunication. Notices to the Underwriters
shall be given to the Representative c/o X.X. Xxxxxx Securities Inc., 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (fax: (000) 000-0000); Attention: Xxxxx X.
Xxxxxx. Notices to the Company shall be given to it at Xxx Xxxxxx Xxxxx,
Xxxxxxxxxx, Xxx Xxxx 00000-0000, (fax: (000) 000-0000); Attention: Xxxxx Xxxx,
Esq.
(c) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
(d) Counterparts. This Agreement may be signed in counterparts (which may
include counterparts delivered by any standard form of telecommunication), each
of which shall be an original and all of which together shall constitute one and
the same instrument.
(e) Amendments or Waivers. No amendment or waiver of any provision of this
Agreement, nor any consent or approval to any departure therefrom, shall in any
event be effective unless the same shall be in writing and signed by the parties
hereto.
(f) Headings. The headings herein are included for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
24
If the foregoing is in accordance with your understanding, please indicate
your acceptance of this Agreement by signing in the space provided below.
Very truly yours,
SYMBOL TECHNOLOGIES, INC.
By_______________________
Title:
Accepted: __________, 2004
X.X. XXXXXX SECURITIES INC.
For itself and on behalf of the
several Underwriters listed
in Schedule 1 hereto.
By___________________________
Authorized Signatory
25
Schedule 1
Underwriter Number of Shares
----------- ----------------
X.X. Xxxxxx Securities Inc.........................
Banc of America Securities LLC.....................
UBS Securities LLC.................................
Wachovia Capital Markets, LLC......................
Xxxxxx X. Xxxxx & Co...............................
Bear, Xxxxxxx & Co. Inc............................
Lazard Freres & Co. LLC............................
Xxxxxx Xxxxxx Partners LLC.........................
----------------
Total.............................
26
Schedule 2
Significant Subsidiaries
27
Annex A
Form of Opinion of Xxxxx X. Xxxx, Esq.
(a) The Company and each of its domestic Significant Subsidiaries is a
corporation under its respective jurisdiction of organization with corporate
power and authority to own its properties and to conduct its business as
described in the Registration Statement and the Prospectus. Based on
certificates from public officials, such counsel confirms that the Company and
each of its domestic Significant Subsidiaries is validly existing and in good
standing under its respective jurisdiction of organization and is qualified to
do business in each jurisdiction in which its respective ownership or lease of
property or the conduct of its respective business requires such qualification,
except where the failure to be so qualified would not, individually or in the
aggregate, have a Material Adverse Effect.
(b) The Company has an authorized capitalization as set forth in the
Prospectus under the heading "Capitalization"; all the outstanding shares of
capital stock of the Company have been duly and validly authorized and issued
and are fully paid and nonassessable; and all the outstanding shares of capital
stock or other equity interests of each Significant Subsidiary of the Company
have been duly and validly authorized and issued, are fully paid and
nonassessable (except, in the case of any foreign subsidiary, for directors'
qualifying shares and except as otherwise described in the Prospectus).
(c) Neither the Company nor any of its Significant Subsidiaries is (i) in
violation of its charter or by-laws or similar organizational documents; (ii) in
default, and no event has occurred that, with notice or lapse of time or both,
would constitute such a default, in the due performance or observance of any
term, covenant or condition contained in any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which it is a party or by
which it is bound or to which any of its property or assets is subject; or (iii)
in violation of any law or statute or any judgment, order, rule or regulation of
any court or arbitrator or governmental or regulatory authority, except in the
case of clauses (ii) and (iii) for any such default or violation that would not,
individually or in the aggregate, have a Material Adverse Effect.
(d) No consent, approval, authorization, order, registration or
qualification of or with any court or arbitrator or governmental or regulatory
authority is required for the execution, delivery and performance by the Company
of the Underwriting Agreement and the issuance and sale of the Shares being
delivered on the Closing Date, except for the registration of the Shares under
the Securities Act and such consents, approvals, authorizations, orders and
registrations or qualifications as may be required under applicable state
securities laws in connection with the purchase and distribution of the Shares
by the Underwriters.
(e) To the best knowledge of such counsel, except as described in the
Prospectus, there are no legal, governmental or regulatory investigations,
actions, suits or proceedings pending to which the Company or any of its
subsidiaries is or may be a party or to which any property of the Company or any
of its subsidiaries is or may be the subject which, individually or
28
in the aggregate, if determined adversely to the Company or any of its
subsidiaries, could reasonably be expected to have a Material Adverse Effect.
(f) The statements in the Prospectus under the captions "Business -
Government regulations" and "- Legal proceedings," insofar as they purport to
describe or summarize certain litigations or provisions of statutes or
regulations referred to therein, are accurate descriptions or summaries in all
material respects.
(g) To the best of knowledge of such counsel, there are no contracts or
documents of a character required to be described in the Registration Statement
or Prospectus or to be filed as exhibits to the Registration Statement that are
not described or filed.
(h) The Rights Agreement has been duly authorized, executed and delivered
by the Company and constitutes a valid and legally binding agreement of the
Company enforceable against the Company in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency or similar
laws affecting creditors' rights generally or by equitable principles relating
to enforceability; the Rights have been duly authorized by the Company, and,
when issued upon issuance of the Shares, will be validly issued, and the poison
pill security has been duly authorized by the Company and validly reserved for
issuance upon the exercise of the Rights and, when issued upon such exercise in
accordance with the terms of the Rights Agreement, will be validly issued, fully
paid and non-assessable.
(i) Each of the Company and its subsidiaries is in compliance with all
Environmental Laws, except, in each case, where noncompliance, individually or
in the aggregate, would not have a material adverse effect on the Company and
its subsidiaries taken as a whole; there are no legal or governmental
proceedings pending, or to the knowledge of such counsel, threatened against or
affecting the Company or any of its subsidiaries under any Environmental Law
which, individually or in the aggregate, could reasonably be expected to have a
material adverse effect on the Company and its subsidiaries taken as a whole.
Such counsel shall also state that no facts came to such counsel's
attention that caused such counsel to believe that the Registration Statement,
at the time it became effective, 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, or that the Prospectus,
as of its date or as of the date hereof, contained or contains an untrue
statement of a material fact or omitted or omits to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; it being understood that such
counsel expresses no belief with respect to the financial statements, schedules,
or other financial data included in, or omitted from, the Registration Statement
or the Prospectus.
In rendering such opinion, such counsel may rely as to matters of fact on
certificates of responsible officers of the Company and public officials that
are furnished to the Underwriters.
The opinion of Xxxxx X. Xxxx, Esq. described above shall be rendered to the
Underwriters at the request of the Company and shall so state therein.
29
Annex B
Form of Opinion of Xxxxxx & Xxxxxxx LLP
(a) The Company is a corporation under the Delaware General Corporation
Law (the "DGCL") with corporate power and authority to own its properties and to
conduct its business as described in the Registration Statement and the
Prospectus. Based on certificates from public officials, we confirm that the
Company is validly existing and in good standing under the DGCL.
(b) The Shares to be issued and sold by the Company pursuant to the
Underwriting Agreement have been duly authorized by all necessary corporate
action of the Company and, when issued to and paid for by you and the other
Underwriters in accordance with the terms of the Underwriting Agreement, will be
validly issued, fully paid and non-assessable and free of preemptive rights
arising from the Governing Documents.
(c) The execution, delivery and performance of the Underwriting Agreement
have been duly authorized by all necessary corporate action of the Company, and
the Underwriting Agreement has been duly executed and delivered by the Company.
(d) The execution and delivery of the Underwriting Agreement and the
issuance and sale of the Shares by the Company to you and the other Underwriters
pursuant to the Underwriting Agreement on the date hereof do not:
(i) violate the Company's Governing Documents; or
(ii) result in the breach of or a default under any of the Material
Agreements; or
(iii) violate any federal or New York statute, rule or regulation or
the DGCL or any Court Order applicable to the Company; or
(iv) require any consents, approvals, or authorizations to be
obtained by the Company from, or any registrations,
declarations or filings to be made by the Company with, any
governmental authority under any federal or New York statute,
rule or regulation or the DGCL applicable to the Company on or
prior to the date hereof.
(e) The Registration Statement has become effective under the Act. With
your consent, based solely on a telephonic confirmation by a member of the Staff
of the Commission on the date hereof, no stop order suspending the effectiveness
of the Registration Statement has been issued under the Act and no proceedings
therefor have been initiated or, to our knowledge, threatened by the Commission.
Any required filing of the Prospectus pursuant to Rule 424 under the Act has
been made in accordance with Rules 424 and 430A under the Act. In rendering the
opinion in this paragraph (e), a statement qualified as to knowledge is intended
to indicate that those attorneys in the firm who have rendered legal services in
connection with the transaction referenced above do not have current actual
knowledge of the inaccuracy of such statement. However, except as
30
otherwise expressly indicated, we have not undertaken any independent
investigation to determine the accuracy of any such statement.
(f) The Registration Statement, as of the date it was declared effective,
and the Prospectus, as of its date, appeared on their face to be appropriately
responsive in all material respects to the requirements for registration
statements on Form S-1 under the Act and the rules and regulations of the
Commission thereunder; it being understood, however, that we express no opinion
with respect to Regulation S-T or the financial statements, schedules, or other
financial data, included in, or omitted from, the Registration Statement or the
Prospectus. For purposes of this paragraph, we have assumed that the statements
made in the Registration Statement and the Prospectus are correct and complete.
(g) The statements in the Prospectus under the caption "Description of
Capital Stock," insofar as they purport to constitute a summary of the terms of
the Common Stock, are accurate descriptions or summaries in all material
respects.
(h) With your consent, based solely on a certificate of an officer of the
Company as to factual matters, the Company is not, and immediately after giving
effect to the sale of the Shares in accordance with the Underwriting Agreement
and the application of the proceeds as described in the Prospectus under the
caption "Use of Proceeds," will not be, required to be registered as an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
Negative Assurance Letter of Xxxxxx & Xxxxxxx LLP
In addition, Xxxxxx & Xxxxxxx shall also confirm, in a separate letter,
that subject to customary qualifications as to its participation, review and
reliance, no facts came to its attention that caused it to believe that the
Registration Statement, at the time it became effective, 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, or
that the Prospectus, as of its date, or as of the Closing Date or Additional
Closing Date, as the case may be, contained an untrue statement of a material
fact or omitted to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; it being understood that it will express no belief with respect to
the financial statements, schedules or other financial data included or
incorporated by reference in, or omitted from the Registration Statement or the
Prospectus.
31
Exhibit A
FORM OF LOCK-UP AGREEMENT
, 2004
X.X. XXXXXX SECURITIES INC.
As Representative of
the several Underwriters listed in
Schedule I to the Underwriting
Agreement referred to below
c/o X.X. Xxxxxx Securities Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: Symbol Technologies, Inc. - Public Offering
Ladies and Gentlemen:
The undersigned understands that you, as Representative of the several
Underwriters, propose to enter into an Underwriting Agreement (the "Underwriting
Agreement") with Symbol Technologies, Inc., a Delaware corporation (the
"Company"), providing for the public offering (the "Public Offering") by the
several Underwriters named in Schedule I to the Underwriting Agreement (the
"Underwriters") of common stock, of the Company (the "Securities"). Capitalized
terms used herein and not otherwise defined shall have the meanings set forth in
the Underwriting Agreement.
In consideration of the Underwriters' agreement to purchase and make the
Public Offering of the Securities, and for other good and valuable consideration
receipt of which is hereby acknowledged, the undersigned hereby agrees that,
without the prior written consent of X.X. Xxxxxx Securities Inc. on behalf of
the Underwriters, the undersigned will not, during the period ending 90 days
after the date of the final prospectus relating to the Public Offering (the
"Final Prospectus"), (1) offer, pledge, announce the intention to sell, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase, or
otherwise transfer or dispose of, directly or indirectly, any shares of Common
Stock, $.01 share par value, of the Company (the "Common Stock") or any
securities convertible into or exercisable or exchangeable for Common Stock
(including without limitation, Common Stock which may be deemed to be
beneficially owned by the undersigned in accordance with the rules and
regulations of the Securities and Exchange Commission and securities which may
be issued upon exercise of a stock option or warrant) or (2) enter into any swap
or other agreement that transfers, in whole or in part, any of the economic
consequences of
32
ownership of the Common Stock, whether any such transaction described in clause
(1) or (2) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. In addition, the undersigned agrees that,
without the prior written consent of X.X. Xxxxxx Securities Inc. on behalf of
the Underwriters, it will not, during the period ending 90 days after the date
of the Final Prospectus, make any demand for or exercise any right with respect
to, the registration of any shares of Common Stock or any security convertible
into or exercisable or exchangeable for Common Stock. The foregoing sentences
shall not apply to (a) transactions relating to shares of Common Stock or other
securities acquired in open market transactions after the completion of the
Public Offering, (b) bona fide gifts, provided the recipient thereof agrees in
writing with X.X. Xxxxxx Securities Inc. on behalf of the Underwriters to be
bound by the terms of this Letter Agreement, (c) dispositions to any trust for
the direct or indirect benefit of the undersigned and/or the immediate family of
the undersigned, provided that such trust agrees in writing with X.X. Xxxxxx
Securities Inc. on behalf o the Underwriters to be bound by the terms of this
Letter Agreement or (d) pledges to any financial institution as collateral and
foreclosures of such pledges, provided that such financial institution agrees in
writing with X.X. Xxxxxx Securities Inc. on behalf of the Underwriters to be
bound by the terms of this Letter Agreement [and, in the case of the Letter
Agreement with Xxxxxxx X. Xxxx, President, Chief Executive Officer and Director
of the Company, (e) dispositions pursuant to a pre-existing written plan meeting
the requirements of Rule 10b5-1 of the Securities Exchange Act of 1934, provided
that such dispositions occur (i) after December 15, 2004 and (ii) at a price per
share of Common Stock that equals or exceeds $16.00].
If:
(1) during the last 17 days of the 90-day restricted period the Company
issues a earnings release or material news or a material event relating to the
Company occurs; or
(2) prior to the expiration of the 90-day restricted period, the Company
announces that it will release earnings results during the 16-day period
beginning on the last day of the 90-day period;
the restrictions imposed by this Letter Agreement shall continue to apply until
the expiration of the 18-day period beginning on the issuance of the earnings
release or the occurrence of the material news or material event.
In furtherance of the foregoing, the Company, and any duly appointed
transfer agent for the registration or transfer of the securities described
herein, are hereby authorized to decline to make any transfer of securities if
such transfer would constitute a violation or breach of this Letter Agreement.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this Letter Agreement. All authority
herein conferred or agreed to be conferred and any obligations of the
undersigned shall be binding upon the successors, assigns, heirs or personal
representatives of the undersigned.
33
The undersigned understands that, if the Underwriting Agreement does not
become effective, the registration statement filed with the Securities and
Exchange Commission with respect to the Public Offering is withdrawn or if the
Underwriting Agreement (other than the provisions thereof which survive
termination) shall terminate or be terminated prior to payment for and delivery
of the Common Stock to be sold thereunder, the undersigned shall be released
form all obligations under this Letter Agreement.
The undersigned understands that the Underwriters are entering into the
Underwriting Agreement and proceeding with the Public Offering in reliance upon
this Letter Agreement.
34
This Letter Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without regard to the conflict of laws
principles thereof.
Very truly yours,
By: _______________________
Name:
Title:
