1
3,500,000 Shares
Microdyne Corporation
Common Stock
UNDERWRITING AGREEMENT
November , 1995
Xxxxxxxxxxx & Co., Inc.
Xxxxxxxx Wertheim & Co., Incorporated
Xxxxxx Xxxxxxx Incorporated
c/o Oppenheimer & Co., Inc.
Xxxxxxxxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
On behalf of the Several
Underwriters named in
Schedule I attached hereto.
Gentlemen:
Microdyne Corporation, a Maryland corporation (the "Company"),
and the Selling Stockholders listed in Schedule II to this Agreement (the
"Selling Stockholders") propose to sell to you and the other underwriters named
in Schedule I to this Agreement (the "Underwriters"), for whom you are acting
as Representatives (the "Representatives"), an aggregate of 3,500,000 shares
(the "Firm Shares") of the Company's common stock, $0.10 par value (the "Common
Stock") of which 2,000,000 shares are to be issued and sold by the Company and
1,500,000 shares are to be sold by the Selling Stockholders. In addition, one
of the Selling Stockholders proposes to grant to the Underwriters an option to
purchase up to an additional 525,000 shares of Common Stock (the "Option
Shares") for the purpose of covering over-allotments in connection with the
sale of the Firm Shares. The Firm Shares and the Option Shares are together
called the "Shares."
1. Sale and Purchase of the Shares. On the basis of the
representations, warranties and agreements contained in, and subject to the
terms and conditions of, this Agreement:
(a) The Company and the Selling Stockholders agree,
severally and not jointly, to sell to each of the Underwriters, and
each of the Underwriters agrees, severally and not jointly, to
purchase from the Company and the Selling Stockholders, at $ per
share (the "Initial Price"), the number of Firm Shares (adjusted by
the Representatives to eliminate fractions) which bears the same
proportion to the total number of Firm Shares to be sold by the
Company or by the Selling Stockholders, as the case may be, as the
number of Firm Shares set forth opposite the name of such Underwriter
in Schedule I to this Agreement bears to the total number of Firm
Shares to be sold by the Company and the Selling Stockholders.
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(b) The Selling Stockholder identified in Schedule II to
this Agreement as offering Option Shares (the "Option Selling
Stockholder") hereby grants to the several Underwriters an option to
purchase, severally and not jointly, all or any part of the Option
Shares at the Initial Price. The number of Option Shares to be
purchased by each Underwriter shall be the same percentage (adjusted
by the Representatives to eliminate fractions) of the total number of
Option Shares to be purchased by the Underwriters as such Underwriter
is purchasing of the Firm Shares. Such option may be exercised only
to cover over-allotments in the sales of the Firm Shares by the
Underwriters and may be exercised in whole or in part at any time
between the date of this Agreement and 30 days after the date of this
Agreement, in each case upon written or telegraphic notice, or verbal
or telephonic notice confirmed by written or telegraphic notice, by
the Representatives to the Company no later than 12:00 noon, New York
City time, on the business day before the Firm Shares Closing Date or
at least two business days before the Option Shares Closing Date (as
defined below), as the case may be, setting forth the number of Option
Shares to be purchased and the time and date (if other than the Firm
Shares Closing Date) of such purchase which shall be not more than
three business days following the date of the exercise of the option.
2. Delivery and Payment. Delivery by the Company and by
each of the Selling Stockholders of the Firm Shares to the Representatives for
the respective accounts of the Underwriters, and payment of the purchase price
by certified or official bank check or checks payable in New York Clearing
House (next day) funds to the Company and to each Selling Stockholder, shall
take place at the offices of Xxxxxxxxxxx & Co., Inc., at Xxxxxxxxxxx Xxxxx,
Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 a.m., New York City
time, on the third business day following the date of this Agreement, provided,
however, that if the Shares sold hereunder are priced after 4:30 p.m., New York
time, on any business day, payment and delivery in respect of the Firm Shares
shall take place on the fourth business day following the date of this
Agreement; if it is determined that settlement within the foregoing time frame
is not feasible, then payment and delivery in respect of the Firm Shares shall
occur at such time on such other date, not later than 10 business days after
the date of this Agreement, as shall be agreed upon by the Company and the
Representatives (such time and date of delivery and payment are called the
"Firm Shares Closing Date").
In the event the option with respect to the Option Shares is
exercised, delivery by the Option Selling Stockholder's Option Shares to the
Representatives for the respective accounts of the Underwriters and payment of
the purchase price by certified or official bank check or checks payable in New
York Clearing House (next day) funds to the Option Selling Stockholder shall
take place at the offices of Xxxxxxxxxxx & Co., Inc. specified above at the
time and on the date (which may be the same date as, but in no event shall be
earlier than, the Firm Shares Closing Date) specified in the notice referred to
in Section 1(b) (such time and date of delivery and payment are called the
"Option Shares Closing Date"). The Firm Shares Closing Date and the Option
Shares Closing Date are called, individually, a "Closing Date" and, together,
the "Closing Dates."
Certificates evidencing the Shares shall be registered in such
names and shall be in such denominations as the Representatives shall request
at least two full business days before the Firm Shares Closing Date or, in the
case of Option Shares, on the day of notice of exercise of the option as
described in Section 1(b) and shall be made available to the Representatives
for checking and packaging, at such place as is designated by the
Representatives, at least one full business day before the Firm Shares Closing
Date (or the Option Shares Closing Date in the case of the Option Shares).
3. Registration Statement and Prospectus; Public
Offering. The Company has prepared in conformity with the requirements of the
Securities Act of 1933, as amended (the "Securities Act"), and the published
rules and regulations thereunder (the "Rules") adopted by the Securities and
Exchange Commission (the "Commission") a registration statement on Form S-3
(No. 33-63737), including a preliminary prospectus relating to the Shares, and
has filed with the Commission such amendments to such registration statement as
may have been required to the date of this Agreement. Copies of such
registration statement (including all
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amendments thereto) and of the related preliminary prospectus have heretofore
been delivered by the Company to you. The term "Registration Statement" means
the Company's registration statement on Form S-3 (File No. 33-63737), including
all financial schedules and exhibits, as amended at the time and on the date it
became or becomes effective under the Securities Act (the "Effective Date"),
including all information, if any, deemed to be part of the Registration
Statement pursuant to Rule 424(b) and Rule 430A of the Rules and as thereafter
amended by post-effective amendment, and any registration statement and
amendment thereto filed pursuant to Rule 462(b) under the Securities Act
relating to the offering covered by the initial registration statement (File
No. 33-63737) (the "Rule 462(b) Registration Statement"). The term
"preliminary prospectus" means any preliminary prospectus (as described in Rule
430 of the Rules) included at any time as a part of the Company's registration
statement on Form S-3 (File No. 33-63737) or filed pursuant to Rule 424(a) of
the Rules. The term "Prospectus" means the prospectus in the form first used
to confirm sales of the Shares (whether such prospectus was included in the
Registration Statement or was subsequently filed with the Commission pursuant
to Rule 424(b) of the Rules), as from time to time amended or supplemented if
the Company furnishes amendments or supplements thereto to the Underwriters, or
the preliminary prospectus forming part of the Registration Statement at the
time it was declared effective together with the term sheet permitted under
Rule 434(b) and filed with the Commission pursuant to Rule 424(b), as
applicable.
The Company and each Selling Stockholder understands that the
Underwriters propose to make a public offering of the Shares, as set forth in
and pursuant to the Prospectus, on or as soon after the Effective Date and the
date of this Agreement as the Representatives deem advisable. The Company and
each Selling Stockholder hereby confirms that the Underwriters and dealers have
been authorized to distribute or cause to be distributed each preliminary
prospectus and are authorized to distribute the Prospectus.
4. Representations and Warranties of the Company and the
Selling Stockholders. (A) The Company hereby represents and warrants to each
Underwriter as follows:
(a) The Registration Statement, on the Effective Date,
complied, the Prospectus, as of the date thereof, complied, any
post-effective amendment to the Registration Statement, as of the date
such post-effective shall become effective, will comply and any
supplement or amendment to the Prospectus, as of the date filed with
the Commission, will comply with the applicable provisions of the
Securities Act and the Rules and the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), and the published rules and
regulations of the Commission under the Exchange Act. On each Closing
Date, the Registration Statement, the Prospectus, any post-effective
amendment to the Registration Statement and any supplement or
amendment to the Prospectus will comply with the applicable provisions
of the Securities Act, the Rules, the Exchange Act and the published
rules and regulations of the Commission under the Exchange Act. The
Registration Statement, as of the Effective Date, did not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein not misleading; and on the other dates referred to
above, none of the Registration Statement, the Prospectus, any
post-effective amendment or any amendment or supplement to the
Prospectus will contain any untrue statement of a material fact or
will omit to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading.
When any preliminary prospectus was first filed with the Commission
(whether filed as part of a registration statement or pursuant to Rule
424(a) of the Rules) and when any amendment thereof or supplement
thereto was first filed with the Commission, such preliminary
prospectus as amended or supplemented complied in all material
respects with the applicable provisions of the Securities Act and the
Rules and did not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading. The
Company makes no representation or warranty as to the paragraph with
respect to stabilization on the inside front cover page of the
Prospectus and the third and seventh paragraphs contained under the
caption "Underwriting" in the Prospectus, and the Company and each
Selling Stockholder acknowledges that such statements constitute the
only information furnished in
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writing by the Representatives on behalf of the several Underwriters
specifically for inclusion in the Registration Statement, any
preliminary prospectus, the Prospectus, any post-effective amendment
to the Registration Statement and any amendment or supplement to the
Prospectus or any preliminary prospectus.
(b) All contracts and other documents required to be
filed as exhibits to the Registration Statement have been filed with
the Commission as exhibits to the Registration Statement; all such
agreements and documents constitute legal, valid and binding
agreements enforceable against the Company, or its subsidiaries, in
accordance with their respective terms; and all of such agreements and
documents are accurately described and fairly presented as required by
the Securities Act and the Rules. There are no other agreements or
documents, whether written or oral, that are required by the
Securities Act or the Rules to be described in the Registration
Statement or filed as an exhibit thereto that are not described or
filed as required.
(c) The financial statements of the Company (including
all notes and schedules thereto) included in the Registration
Statement, the Prospectus and any preliminary prospectus fairly
present the financial position, the results of operations and cash
flows and the stockholders' equity and the other information purported
to be shown therein of the Company at the respective dates and for the
respective periods to which they apply; such financial statements have
been prepared in conformity with generally accepted accounting
principles ("GAAP") consistently applied throughout the periods
involved, and all adjustments necessary for a fair presentation of the
results for such periods have been made; and segment information and
data, other than the revenue by business operation presented in such
financial statements, are not required to be included in the
Registration Statement, the Prospectus or any preliminary prospectus
under GAAP or Financial Accounting Standard 14.
(d) Xxxxx Xxxxxxxx LLP, whose reports are filed with the
Commission as a part of the Registration Statement, the Prospectus and
each preliminary prospectus, are, and during the periods covered by
their reports were, independent public accountants as required by the
Securities Act and the Rules. The Company has not had any
"disagreement" with Xxxxx Xxxxxxxx LLP and has not experienced any
"reportable event" (as such terms are used in Item 304 of Regulation
SK).
(e) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Maryland. The Company has no subsidiary or subsidiaries and does
not control, directly or indirectly, any corporation, partnership,
joint venture, association or other business organization other than
Wireless Data Corporation, Microdyne Ltd. and Microdyne U.K., Inc.
The Company is duly qualified and in good standing as a foreign
corporation in each jurisdiction in which the character or location of
its assets or properties (owned, leased or licensed) or the nature of
its business makes such qualification necessary, except for such
jurisdictions where the failure to so qualify would not have a
material adverse effect on the condition (financial or other), assets
or properties, business, prospects, net worth or results of operations
of the Company and its subsidiaries taken as a whole (a "Material
Adverse Effect"). Except as disclosed in the Registration Statement
and the Prospectus, the Company does not own, lease or license any
asset or property or conduct any business outside the United States of
America. The Company has all requisite corporate power and authority,
and all necessary authorizations, approvals, consents, orders,
licenses, certificates and permits ("Permits") from all governmental
or regulatory bodies or any other person or entity, to own, lease and
license its assets and properties and conduct its businesses as now
being conducted and as described in the Registration Statement and the
Prospectus; no such Permit contains a materially burdensome
restriction other than as disclosed in the Registration Statement and
the Prospectus; and the Company has all such corporate power and
authority, and such Permits to enter into, deliver and perform this
Agreement and to issue and sell the Shares (except as may be required
under the Securities Act and state and foreign Blue Sky laws).
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(f) The Company owns or possesses adequate and
enforceable rights to use each of its trademarks and trade names (the
"Trademarks") and owns or possesses adequate licenses and enforceable
rights to use all other patents, patent applications, trademarks,
trademark applications, service marks, copyrights, copyright
applications, inventions, trade secrets, proprietary techniques
(including software source codes), processes, substances, technology,
know-how and other similar rights (collectively with the Trademarks,
"Intangibles") necessary for the conduct of its businesses as now
being conducted and as described in the Registration Statement and the
Prospectus. The Company has not infringed, is not infringing, and has
not received any notice of infringement of any Intangible of any other
person that will have a Material Adverse Effect and the Company does
not know of any basis therefor. None of the products or processes of
the Company or any of its subsidiaries referred to in the Prospectus
and relating to the business of the Company or any of its subsidiaries
now operated or proposed to be operated by any of them as described in
such Prospectus infringes or conflicts with any right or patent, or
with any discovery invention, product or process which is the subject
of any patent application known to the Company, in a manner which
would result in a Material Adverse Effect;
(g) The Company has good and marketable title in fee
simple to each of the items of real property and good title to each of
the items of personal property which are referred to in the
Registration Statement and the Prospectus as being owned by it and
valid and enforceable leasehold interests in each of the items of real
and personal property which are referred to in the Registration
Statement and the Prospectus as being leased by it, in each case free
and clear of all liens, encumbrances, claims, security interests and
defects, other than those described in the Registration Statement and
the Prospectus and those which do not and will not have a Material
Adverse Effect.
(h) There is no litigation or governmental or other
proceeding or investigation before any court or before or by any
public body or board pending or, to the Company's best knowledge,
threatened (and the Company does not know of any basis therefor)
against or involving the assets, properties or businesses of, the
Company which if determined adversely to the Company would materially
adversely affect the value or the operation of any such assets or
properties or the business, results of operations or financial
condition of the Company.
(i) Subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
except as described therein, there has not been any material adverse
change in the assets or properties, business, prospects, results of
operations or financial condition of the Company, whether or not
arising from transactions in the ordinary course of business; the
Company has not sustained any material loss or interference with its
assets, businesses or properties from fire, explosion, earthquake,
flood or other calamity, whether or not covered by insurance, or from
any labor dispute or any court or legislative or other governmental
action, order or decree; and since the date of the latest balance
sheet included in the Registration Statement and the Prospectus,
except as reflected therein, the Company has not undertaken any
liability or obligation, direct or contingent, except for liabilities
or obligations undertaken in the ordinary course of business.
(j) Each agreement listed in the Exhibits to the
Registration Statement is in full force and effect and is valid and
enforceable by the Company in accordance with its terms, assuming the
due authorization thereof by each of the other parties thereto.
Neither the Company, nor to the best of the Company's knowledge, any
other party is in default in the observance or performance of any term
or obligation to be performed by it under any such agreement, and no
event has occurred which with notice or lapse of time or both would
constitute such a default, which default or event would have a
Material Adverse Effect. No default exists, and no event has occurred
which with notice or lapse of time or both would constitute a default,
in the due performance and observance of any term, covenant or
condition, by the Company of any other indenture, mortgage, deed of
trust, note or any other agreement or
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instrument to which the Company is a party or by which it or its
properties or businesses may be bound or affected, which default or
event would have a Material Adverse Effect.
(k) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or
any Underwriter for any brokerage commission, finder's fee or other
fee or other like payment.
(l) The Company is not in violation of any term or
provision of its articles of incorporation or by-laws or of any
franchise, license, permit, judgment, decree, order, statute, rule or
regulation, where the consequences of such violation would have a
Material Adverse Effect.
(m) Neither the execution, delivery and performance of
this Agreement by the Company nor the consummation of any of the
transactions contemplated hereby (including, without limitation, the
issuance and sale by the Company of the Shares to be sold by the
Company) will give rise to a right to terminate or accelerate the due
date of any payment due under, or conflict with or result in the
breach of any term or provision of, or constitute a default (or an
event which with notice or lapse of time or both would constitute a
default) under, or require any consent or waiver under, or result in
the execution or imposition of any lien, charge or encumbrance upon
any properties or assets of the Company pursuant to the terms of, any
indenture, mortgage, deed of trust or other agreement or instrument to
which the Company is a party or by which it or any of its properties
or businesses is bound, or any franchise, license, permit, judgment,
decree, order, statute, rule or regulation applicable to the Company
or violate any provision of the articles of incorporation or by-laws
of the Company, except for such consents or waivers which have already
been obtained and are in full force and effect.
(n) The Company has an authorized and outstanding capital
stock as set forth under the caption "Capitalization" in the
Prospectus. All of the outstanding shares of Common Stock have been
duly and validly issued and are fully paid and nonassessable and none
of the outstanding shares of Common Stock was issued in violation of
any preemptive or other similar right or any federal or state
securities law. The Shares, when issued (in the case of Shares to be
sold by the Company) and sold pursuant to this Agreement, will be duly
and validly issued, fully paid and nonassessable and none of such
Shares will be issued in violation of any preemptive or other similar
right. Except as disclosed in the Registration Statement and the
Prospectus, there is no outstanding option, warrant or other right
calling for the issuance of, and no commitment, plan or arrangement to
issue, any share of stock of the Company or any security convertible
into, or exercisable or exchangeable for, such stock. The Common
Stock and the Shares conform in all material respects to all
statements in relation thereto contained in the Registration Statement
and the Prospectus. All of the outstanding shares of the capital
stock of the Company's subsidiaries have been duly and validly issued
and are fully paid and non-assessable and none of such outstanding
capital stock was issued in violation of any preemptive or other
similar right or any federal or state securities law. The Shares
offered by the Company and to be sold pursuant to this Agreement have
been duly authorized and at the Closing Date, after payment therefor
in accordance herewith, will be validly issued, fully paid and
nonassessable not subject to any "adverse claim," as such term is used
in Section 8-302 of the Maryland Uniform Commercial Code, with no
personal liability attaching to the holder solely as a result of the
ownership thereof. Upon the issuance and delivery pursuant to this
Agreement the Shares to be sold by the Company, assuming that the
Underwriter is a "bona fide purchaser," as defined in Section 8-302 of
the Maryland Uniform Commercial Code, the Underwriter will acquire
good and marketable title to the Shares free and clear of any liens,
charges, claims, preemptive rights, encumbrances, pledges, security
interests, defects or other like restrictions or like material equity
of any kind whatsoever.
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(o) Subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
except as described or referred to therein, neither the Company nor
any subsidiary has (i) issued any securities or incurred any liability
or obligation, direct or contingent, for borrowed money, (ii) entered
into any transaction not in the ordinary course of business or (iii)
declared or paid any dividend or made any distribution on any shares
of its stock or redeemed, purchased or otherwise acquired or agreed to
redeem, purchase or otherwise acquire any shares of its stock.
(p) No holder of any security of the Company has any
right to have any security owned by such holder included in the
Registration Statement or any right to demand registration of any
security owned by such holder. The Company has obtained from certain
executive officers of the Company who together will hold 4,970,517
shares of Common Stock after the offering of the Shares pursuant to
this Agreement (including 40,368 shares issuable pursuant to options
that are currently exercisable or exercisable within 60 days after
October 1, 1995) their enforceable written agreement that for a period
of at least 180 days from the date of this Agreement they will not,
without the prior written consent of Xxxxxxxxxxx & Co., Inc. offer,
sell or dispose of any shares of Common Stock, options or warrants to
acquire shares of Common Stock or securities exchangeable for or
convertible into Common Stock. The Company has obtained from certain
executive officers of the Company who together will hold 105,592
shares of Common Stock after the offering of the Shares pursuant to
this Agreement (consisting of 105,592 shares issuable pursuant to
options that are currently exercisable or exercisable within 60 days
after October 1, 1995) their enforceable written agreement that for a
period of at least 90 days from the date of this Agreement they will
not, without the prior written consent of Xxxxxxxxxxx & Co., Inc.
offer, sell or dispose of any shares of Common Stock, options or
warrants to acquire shares of Common Stock or securities exchangeable
for or convertible into Common Stock.
(q) All necessary corporate action has been duly and
validly taken by the Company to authorize the execution, delivery and
performance of this Agreement and the issuance and sale of the Shares.
This Agreement has been duly and validly executed and delivered by the
Company and constitutes and will constitute the legal, valid and
binding obligation of the Company enforceable against the Company in
accordance with its terms, except (i) as the enforceability thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting the enforcement of creditors' rights
generally and by general equitable principles and (ii) with respect to
this Agreement, to the extent that rights to indemnity or contribution
under this Agreement may be limited by federal and state securities
laws or the public policy underlying such laws.
(r) The Company and each of its subsidiaries have
satisfactory employer-employee relationships with their respective
employees. The Company is not involved in any labor dispute nor, to
the knowledge of the Company, is any such dispute threatened, which
dispute would have a Material Adverse Effect. Except as disclosed in
the Registration Statement or the Prospectus, neither the Company nor
any of its subsidiaries maintains, sponsors or contributes to any
program or arrangement that is an "employee pension benefit plan," any
"employee welfare benefit plans" requiring an expenditure by the
Company or any of its subsidiaries of in excess of $500,000 in the
aggregate in any year, or a "multiemployer plan," as such terms are
defined in Sections 3(2), 3(1), and 3(37), respectively, of the
Employee Retirement Income Security Act of 1974, as amended. Except
as disclosed in the Registration Statement or the Prospectus, neither
the Company nor any of its subsidiaries maintains or contributes to,
or has maintained or contributed to, a "defined benefit plan," as
defined in Section 3(35) of ERISA. Neither the Company nor any of its
subsidiaries or predecessors has ever completely or partially
withdrawn from a "multiemployer plan."
(s) The Company is conducting its business in compliance
with all applicable laws, rules and regulations of the jurisdictions
in which it is conducting business, including, without limitation, all
applicable local, state and federal employment, truth-in-advertising,
franchising, immigration and
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environmental laws and regulations, except where the failure to be so
in compliance would not have a Material Adverse Effect.
(t) No transaction has occurred between or among the
Company and any of its officers or directors or any affiliate or
affiliates of any such officer or director that is required to be
described in and is not described in (or incorporated by reference in)
the Registration Statement and the Prospectus.
(u) Neither the Company nor any of its officers,
directors or affiliates has taken or will take, directly or
indirectly, any action designed to or which might reasonably be
expected to cause or result in, or which has constituted or which
might reasonably be expected to constitute, the stabilization or
manipulation of the price of the Common Stock to facilitate the sale
or resale of any of the Shares.
(v) The Company has filed all federal, state, local and
foreign tax returns which are required to be filed through the date
hereof, or has received extensions thereof, and has paid all taxes
shown on such returns and all assessments received by it to the extent
that the same are material and have become due.
(w) All of the Company's outstanding Common Stock is
listed on the National Association of Securities Dealers Automated
Quotation ("Nasdaq") National Market and the Shares to be sold
hereunder have been approved for listing on the Nasdaq National
Market, subject to official notice of issuance.
(x) The minute books of the Company and each of its
subsidiaries made available to Xxxxxx, Xxxxx & Xxxxxxx LLP as counsel
to the Underwriter, (A) contain minutes and consents from all meetings
and actions of the Company's and each such subsidiary's stockholders,
board of directors, and the committees of such board since the
respective dates of organization of the Company and each of its
subsidiaries and (B) reflect all transactions referred to in such
minutes accurately in all material respects. The Company has duly and
validly authorized, and entered into valid and binding agreements
concerning, (i) all stock options granted by the Company, (ii) all
acquisitions described or referred to under the Prospectus caption
"Business-Acquisitions" and (iii) all material agreements referred to
or described in the Prospectus captions "Risk Factors--Dependence on
Novell," "Business--Distribution" and "Business--Manufacturer Support
Services."
(y) No transfer tax, stamp duty or other similar tax is
payable by or on behalf of the Underwriter in connection with the
issuance by the Company, or the purchase by the Underwriter, of the
Shares or any resales of such Shares by the Underwriter;
(z) The Company has complied with all of the requirements
and filed the required forms as specified in Florida Statutes Section
517.075.
(B) Each Selling Stockholder, severally and not jointly, represents
and warrants as to such Selling Stockholder to each Underwriter that:
(a) This Agreement and such Selling Stockholders' Custody
Agreement and Power of Attorney (the "Custody Agreement and Power of
Attorney") among such Selling Stockholder and Xxxxxx X. Xxxxxx and
Xxxx X. Xxxxxxx, as attorneys-in- fact, and ,
as custodian, have been duly and validly executed and delivered by
each such Selling Stockholder and constitute the legal, valid and
binding obligation of such Selling Stockholder, enforceable against
such Selling Stockholder in accordance with their respective terms,
except (i) as the enforceability hereof and thereof may be limited by
bankruptcy, insolvency, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general equitable
principles and (ii) to the extent that rights to indemnity or
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contribution under this Agreement may be limited by federal and state
securities laws or the public policy underlying such laws.
(b) Such Selling Stockholder has good, valid and
marketable title to the Shares to be sold by it pursuant to this
Agreement, free and clear of all liens, encumbrances, security
interests, restrictions or claims whatsoever, with the legal right and
full power to enter into this Agreement and to sell, transfer and
deliver such Shares hereunder and, upon the delivery of and payment
for such Shares as contemplated hereby, such Selling Stockholder will
convey to the Underwriters good, valid and marketable title to the
Shares being sold by such Selling Stockholder, free and clear of all
liens, encumbrances, security interests, restrictions or claims
whatsoever, except for those created or imposed by the Underwriters.
The Shares offered by the Selling Stockholders and to be sold pursuant
to this Agreement have been duly authorized and at the Closing Date,
after payment therefor in accordance herewith (as the case may be),
will be validly issued, fully paid and nonassessable not subject to
any "adverse claim," as such term is used in Section 8-302 of the
Maryland Uniform Commercial code, with no personal liability attaching
to the holder solely as a result of the ownership thereof. Upon the
issuance and delivery pursuant to this Agreement the Shares to be sold
by the Selling Stockholders, assuming that the Underwriter is a "bona
fide purchaser," as defined in Section 8-302 of the Maryland Uniform
Commercial Code, the Underwriter will acquire good and marketable
title to the Shares free and clear of any liens, charges, claims,
preemptive rights, encumbrances, pledges, security interests, defects
or other like restrictions or like material equity of any kind
whatsoever.
(c) All information with respect to such Selling
Stockholder contained in the Registration Statement and Prospectus is
true and correct in all material respects and does not omit to state
any material fact necessary to make such information not misleading.
(d) No transaction has occurred between such Selling
Stockholder and the Company that is required to be described in and is
not described in (or incorporated by reference in) the Registration
Statement and the Prospectus.
(e) Such Selling Stockholder has not taken and will not
take, directly or indirectly, any action designed to or which might
reasonably be expected to cause or result in, or which has constituted
or which will reasonably be expected to constitute, stabilization or
manipulation of the price of the Common Stock to facilitate the sale
or resale of any of the Shares.
(f) Such Selling Stockholder hereby repeats and confirms
as if set forth in full herein each of the representations, warranties
and agreements made by such Selling Stockholder in the Custody
Agreement and Power of Attorney and agrees that such representations,
warranties and agreements are made hereby for the benefit of, and may
be relied upon by, (i) the Representatives, the Underwriters and
Xxxxxx, Xxxxx & Bockius LLP, counsel to the Underwriters, (ii) the
Company and McGuire, Woods, Battle & Xxxxxx, L.L.P., counsel to the
Company, and (iii) each other Selling Stockholder.
(C) The Option Selling Stockholder represents and warrants to each
Underwriter that the representations and warranties of the Company set forth in
Section 4(A) of this Agreement are true and correct and reports and confirms
such representations and warranties as though set forth in full herein in this
Paragraph (C).
5. Conditions of the Underwriters' Obligations. The
obligations of the Underwriters under this Agreement are several and not joint.
The respective obligations of the Underwriters to purchase the Shares are
subject to each of the following terms and conditions:
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10
(a) The Prospectus shall have been timely filed with the
Commission in accordance with Section 6(A)(a) of this Agreement.
(b) No order preventing or suspending the use of any
preliminary prospectus or the Prospectus shall have been or shall be
in effect and no order suspending the effectiveness of the
Registration Statement shall be in effect and no proceedings for such
purpose shall be pending before or threatened by the Commission, and
any requests for additional information on the part of the Commission
(to be included in the Registration Statement or the Prospectus or
otherwise) shall have been complied with to the satisfaction of the
Representatives.
(c) The representations and warranties of the Company and
the Selling Stockholders contained in this Agreement and in the
certificates delivered pursuant to Section 5(d) and 5(e) of this
Agreement shall be true and correct when made and on and as of each
Closing Date as if made on such date, and the Company and the Selling
Stockholders shall have performed all covenants and agreements and
satisfied all the conditions contained in this Agreement required to
be performed or satisfied by it or them at or before such Closing
Date.
(d) The Representatives shall have received on each
Closing Date a certificate, addressed to the Representatives and dated
such Closing Date, of the chief executive or chief operating officer
and the chief financial officer or chief accounting officer of the
Company, to the effect that the signers of such certificate have
carefully examined the Registration Statement, the Prospectus and this
Agreement and that the representations and warranties of the Company
in this Agreement are true and correct on and as of such Closing Date
with the same effect as if made on such Closing Date and the Company
has performed all covenants and agreements and satisfied all
conditions contained in this Agreement required to be performed or
satisfied by it at or prior to such Closing Date.
(e) The Representatives shall have received on such
Closing Date a certificate, addressed to the Representatives and dated
such Closing Date, of each Selling Stockholder (or a representative
thereof) to the effect that such Selling Stockholder has carefully
examined the Registration Statement, the Prospectus and this Agreement
and that the representations and warranties of such Selling
Stockholder in this Agreement are true and correct on and as of such
Closing Date with the same effect as if made on such Closing Date and
such Selling Stockholder has performed all covenants and agreements
and satisfied all conditions contained in this Agreement required to
be performed or satisfied by such Selling Stockholder at or prior to
such Closing Date.
(f) The Representatives shall have received at the time this
Agreement is executed and on each Closing Date a letter or letters
signed by Xxxxx Xxxxxxxx LLP, addressed to the Representatives and
dated, respectively, the date of this Agreement and each such Closing
Date, in form and substance satisfactory to the Representatives,
confirming that they are independent accountants within the meaning of
the Securities Act and the Rules, that the response to Item 10 of the
Registration Statement is correct insofar as it relates to them and
stating in effect that:
(i) in their opinion the audited financial
statements and financial statement schedules included in the
Registration Statement and the Prospectus and reported on by
them comply as to form in all material respects with the
applicable accounting requirements of the Securities Act and
the Rules;
(ii) on the basis of a reading of the amounts
included in the Registration Statement and the Prospectus
under the headings "Summary Consolidated Financial Data,"
"Selected Consolidated Financial Data" and "Quarterly Results
of Operations" carrying out certain procedures (but not an
examination in accordance with generally accepted auditing
standards)
- 10 -
11
which would not necessarily reveal matters of significance with
respect to the comments set forth in such letter, a reading of the
minutes of the meetings of the stockholders and directors of the
Company, and inquiries of certain officials of the Company who have
responsibility for financial and accounting matters of the Company as
to transactions and events subsequent to the date of the latest
audited financial statements, nothing came to their attention which
caused them to believe that:
(A) the amounts in "Summary Consolidated
Financial Data," "Selected Consolidated Financial
Data" and "Quarterly Results of Operations" included
in the Registration Statement and the Prospectus do
not agree with the corresponding amounts in the
audited and unaudited financial statements from which
such amounts were derived; or
(B) (i) with respect to the Company there
were, at a specified date not more than five business
days prior to the date of the letter, any increases
in the short-term and long-term liabilities of the
Company or capital stock of the Company or decreases
in working capital or the stockholders' equity of the
Company, as compared with the amounts shown on the
Company's audited October 1, 1995 balance sheet
included in the Registration Statement, or (ii) for
the period from October 1, 1995 to such specified
date not more than five business days prior to the
date of the letter, there were any decreases in net
sales or operating income, in which case the Company
shall deliver to the Representatives a letter
containing an explanation by the Company as to the
significance thereof unless said explanation is not
deemed necessary by the Representatives; and
(iii) they have performed certain other procedures
as a result of which they determined that certain information
of an accounting, financial or statistical nature (which is
limited to accounting, financial or statistical information
derived from the general accounting records of the Company)
set forth in the Registration Statement and the Prospectus and
reasonably specified by the Representatives agrees with the
accounting records of the Company.
References to the Registration Statement and the Prospectus in this
paragraph (f) are to such documents as amended and supplemented at the
date of the letter.
(g) The Representatives shall have received on each
Closing Date from McGuire, Woods, Battle & Xxxxxx, L.L.P., counsel for
the Company, an opinion, addressed to the Representatives and dated
such Closing Date, and stating in effect that:
(i) The Company has been duly organized and is
validly existing as a corporation in good standing under the
laws of the State of Maryland. Each of the subsidiaries of
the Company is validly existing as a corporation in good
standing in the jurisdiction of its incorporation. Each of
the Company and its subsidiaries is duly qualified and in good
standing in all other jurisdictions in which the nature of the
business transacted or property owned or leased by it makes
such qualification necessary, except where the failure so to
qualify or be in good standing would not have a Material
Adverse Effect.
(ii) Each of the Company and its subsidiaries has
all requisite corporate power and authority to own, lease and
license its assets and properties and conduct its business as
described in the Registration Statement and the Prospectus;
and the Company has all requisite corporate power and
authority and all necessary governmental, and all other
necessary authorizations, approvals, consents, orders,
licenses, certificates and permits, authorizations,
- 11 -
12
approvals, consents, orders, licenses, certificates and
permits to enter into, deliver and perform this Agreement and
to issue and sell the Shares, other than those required under
the Securities Act, which have been received and are in full
force and effect, and state and foreign Blue Sky laws.
(iii) The Company has authorized and issued capital
stock as set forth under the caption "Capitalization" in the
Prospectus; the certificates evidencing the Shares are in due
and proper legal form and have been duly authorized for
issuance by the Company; all of the outstanding shares of
Common Stock have been duly and validly authorized and have
been duly and validly issued; all of the outstanding shares of
Common Stock are fully paid and non-assessable and none of the
outstanding shares of Common Stock was issued in violation of
any statutory preemptive or other similar right or any federal
or state securities law. The Shares to be sold by the Company
pursuant to this Agreement have been duly authorized and, when
issued and sold pursuant to this Agreement, will be validly
issued, fully paid and nonassessable and none of such Shares
will have been issued in violation of any preemptive or other
similar right. To the best knowledge of such counsel after
reasonable inquiry, the Shares to be sold by the Company will
be issued and sold free of any rights that entitle or will
entitle any person to acquire any Shares upon the issuance
thereof by the Company, and, other than as described in the
Prospectus, free of any restriction on voting or transfer
(other than certain administrative procedures with respect to
the transfer of shares) pursuant to the Company's articles of
incorporation, by-laws or other governing documents or any
agreement or other instrument to which the Company or any of
its subsidiaries is a party or by which it may be bound.
Except as disclosed in the Registration Statement and the
Prospectus, there is no outstanding option, warrant or other
right calling for the issuance of, and no commitment or
agreement to issue, any share of stock of the Company or any
security convertible into, exercisable for, or exchangeable
for stock of the Company. The Common Stock and the Shares
conform in all material respects to the descriptions thereof
contained in the Registration Statement and the Prospectus.
All of the outstanding shares of the capital stock of the
Company's subsidiaries have been duly and validly issued and
are fully paid and non-assessable and none of such outstanding
capital stock was issued in violation of any preemptive or
other similar right or any federal or state securities law.
(iv) All necessary corporate action has been duly
and validly taken by the Company to authorize the execution,
delivery and performance of this Agreement. This Agreement
has been duly and validly executed and delivered by the
Company and constitutes the legal, valid and binding
obligation of the Company, enforceable against the Company in
accordance with its terms except (A) as such enforceability
may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general
equitable principles and (B) with respect to this Agreement,
to the extent that rights to indemnity or contribution under
this Agreement may be limited by federal or state securities
laws or the public policy underlying such laws.
(v) Neither the execution, delivery and performance
of this Agreement by the Company nor the consummation of any
of the transactions contemplated hereby (including the
issuance and sale by the Company of the Shares) will give rise
to a right to terminate or accelerate the due date of any
payment due under, or conflict with or result in the breach of
any term or provision of, or constitute a default (or any
event which with notice or lapse of time, or both, would
constitute a default) under, or require consent or waiver
under, or result in the execution or imposition of any lien,
charge or encumbrance upon any properties or assets of the
Company pursuant to the terms of, any indenture, mortgage,
deed of trust, note or other agreement or instrument of which
such counsel is aware and to which the Company is a party
- 12 -
13
or by which it or any of its properties or businesses is
bound, or any franchise, license, permit, judgment, decree,
order, statute, rule or regulation of which such counsel is
aware or violate any provision of the articles of
incorporation or by-laws of the Company.
(vi) The Company is not in violation of any term or
provision of its articles of incorporation. To the best of
such counsel's knowledge after reasonable inquiry, no default
exists, and no event has occurred which with notice or lapse
of time, or both, would constitute a default, in the due
performance and observance by the Company of any term,
covenant or condition, of any agreement, instrument or other
documents to which the Company is a party or by which its
assets or properties or businesses are bound, except as may be
disclosed in the Prospectus.
(vii) None of the Company's subsidiaries is (A) in
violation of its articles or certificate of incorporation or
by-laws, or other organizational documents or (B) to the best
knowledge of such counsel after reasonable inquiry, in default
in any material respect in the performance of any material
obligation, agreement or condition contained in any agreement,
bond, debenture, note or other evidence of indebtedness.
(viii) To the best knowledge of such counsel after
reasonable inquiry, (A) neither the Company nor any of its
subsidiaries is in material violation of any law, ordinance,
administrative or governmental rule or regulation, applicable
to the Company or any of its subsidiaries or of any decree of
any court or governmental agency or body having jurisdiction
over the Company or any of its subsidiaries, subject to such
qualifications as may be set forth in the Prospectus and (B)
the Company and each of its subsidiaries has such material
Permits as are necessary to own its respective properties and
to conduct its business in the manner described in the
Prospectus, subject to such qualification, as may be set forth
in the Prospectus.
(ix) No consent, approval, authorization or order of
any federal or Maryland court or governmental agency or body
is required for the performance of this Agreement by the
Company or the consummation of the transactions contemplated
hereby, except such as have been obtained under the Securities
Act, such as may be required under state securities or Blue
Sky laws in connection with the purchase and distribution of
the Shares by the several Underwriters (as to which such
counsel need express no opinion) and such as may be required
under the rules of the National Association of Securities
Dealers, Inc. with respect to the underwriting arrangements
reflected in this Agreement (as to which such counsel need
express no opinion).
(x) Except as described in the Registration
Statement and the Prospectus, to the best of such counsel's
knowledge, there is no litigation or governmental or other
proceeding or investigation before any court or before or by
any public body or board pending or threatened against, or
involving the assets, properties or businesses of, the Company
which is reasonably likely to have a Material Adverse Effect.
(xi) The statements in the Prospectus insofar as
such statements constitute a summary of agreements or
documents referred to therein, statements of law or legal
conclusions are fair summaries of the material provisions
thereof, accurately present the information required with
respect to such documents and matters and are accurate in all
material respects. All contracts and other documents required
to be filed as exhibits to, or described in, the Registration
Statement have been so filed with the Commission or are
described as required in the Registration Statement, as the
case may be.
- 13 -
14
(xii) The Registration Statement and the Prospectus
and each amendment or supplement thereto (except for the
financial statements and notes and schedules and other
financial and statistical data included therein, as to which
such counsel need express no opinion) comply as to form in all
material respects with the requirements of the Securities Act
and the Rules.
(xiii) Such counsel has been advised by the
Commission that the Registration Statement has become
effective under the Securities Act, and, to the best of such
counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted or
are threatened or pending.
To the extent deemed advisable by such counsel, they may rely
as to matters of fact on certificates of responsible officers of the Company
and public officials. Copies of such certificates shall be furnished to the
Representatives and counsel for the Underwriters.
In addition, such counsel shall state that such counsel has
participated in conferences with officers and other representatives of the
Company, representatives of the Representatives and representatives of the
independent certified public accountants of the Company, at which conferences
the contents of the Registration Statement and the Prospectus and related
matters were discussed and, although such counsel is not passing upon and does
not assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement and the Prospectus (except
as specified in the foregoing opinion), on the basis of the foregoing no facts
have come to the attention of such counsel which have caused such counsel to
believe that the Registration Statement at the time it became effective and at
each Closing Date contained any untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus as of its date and at
each Closing Date contained any untrue statement of a material fact or omitted
to state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading (it
being understood that such counsel need not express any belief with respect to
the financial statements and schedules and other financial data included in the
Registration Statement or the Prospectus).
(h) The Representatives shall have received on each
Closing Date from counsel for each of the Selling Stockholders, an
opinion, addressed to the Representatives and dated such Closing Date,
and stating in effect that:
(i) Such Selling Stockholder has all requisite power
and all necessary authorizations, approvals, consents, orders,
licenses, certificates and permits to enter into, deliver and
perform this Agreement and the Custody Agreement and Power of
Attorney and to sell the Shares to be sold by it hereunder,
other than those required under the Securities Act and state
and foreign Blue Sky laws. This Agreement and the Custody
Agreement and Power of Attorney have each been duly executed
and delivered by such Selling Stockholder and constitute the
legal and valid obligation of such Selling Stockholder.
(ii) No consent, approval, authorization or order of
any federal or Maryland court or governmental agency or body
is required for the performance of this Agreement and the
Custody Agreement and Power of Attorney by such Selling
Stockholder or the sale by such Selling Stockholder of the
Shares to be sold by it hereunder, except such as have been
obtained under the Securities Act and such as may be required
under state securities or Blue Sky laws in connection with the
purchase and distribution of such Shares by the several
Underwriters (as to which such counsel need express no
opinion) and such as may be required under the rules of the
National Association of Securities Dealers, Inc. with respect
to the underwriting arrangements reflected in this Agreement
(as to which such counsel need express no opinion).
- 14 -
15
(iii) To the best of such counsel's knowledge, there
is no litigation or governmental or other proceeding or
investigation before any court or before or by any public body
or board pending or threatened against, or involving the
assets, properties or business of, such Selling Stockholder,
which might have a Material Adverse Effect.
(iv) Each of the Underwriters has received good and
valid title to the Shares being sold by such Selling
Stockholder hereunder, free and clear of any liens,
encumbrances, security interests and claims whatsoever, except
for those created or imposed by the Underwriters.
To the extent deemed advisable by such counsel, they may rely
as to matters of fact on certificates of responsible officers of the Company,
the Selling Stockholders and public officials and with respect to the opinion
that this Agreement constitutes the legal and valid obligation of each of the
Selling Stockholders, counsel not admitted to practice in the State of New York
may assume without any inquiry that the law of the jurisdiction where such
counsel is admitted to practice is identical to the law of State of New York
without regard to conflicts of laws. Copies of such certificates shall be
furnished to the Representatives and counsel for the Underwriters.
(i) All proceedings taken in connection with the sale of
the Firm Shares and the Option Shares as herein contemplated shall be
reasonably satisfactory in form and substance to the Representatives
and their counsel and the Underwriters shall have received from
Xxxxxx, Xxxxx & Xxxxxxx LLP a favorable opinion, addressed to the
Representatives and dated such Closing Date, with respect to the
Shares, the Registration Statement and the Prospectus and such other
related matters as the Representatives may reasonably request, and the
Company and the Selling Stockholders shall have furnished to Xxxxxx,
Xxxxx & Bockius LLP such documents as they may reasonably request for
the purpose of enabling them to pass upon such matters.
(j) The Representatives shall have received on each
Closing Date a certificate, including exhibits thereto, addressed to
the Representatives and dated such Closing Date, of the Secretary or
an Assistant Secretary of the Company, signed in such officer's
capacity as such officer, as to the (i) certificate of incorporation
and bylaws of the Company, (ii) resolutions authorizing the execution
and delivery of the Registration Statement, this Agreement and the
performance of the transactions contemplated by this Agreement, the
Registration Statement, the Prospectus and the offering of the Shares
and (iii) incumbency of the person or persons authorized to execute
and deliver the Registration Statement, this Agreement and any other
documents contemplated by the offering of the Shares.
(k) The Representatives shall have received on each
Closing Date certificates of the Secretaries of States (or comparable
officials) where the Company is incorporated and doing business as to
the good standing of the Company, listing all charter documents on
file, qualification of the Company to do business as a foreign
corporation, payment of taxes and filing of annual reports. In
addition, the Representatives shall have received copies of all
charter documents of the Company certified by the Secretary of State
of the State of Maryland.
(l) The Representatives shall have received on each
Closing Date a certificate, addressed to the Representatives, and
dated such Closing Date, of an executive officer of the Company to the
effect that the signer of such certificate has reviewed and
understands the provisions of Section 517.075 of the Florida Statutes,
and represents that the Company has complied, and at all times will
comply, with all provisions of Section 517.075 and further, that as of
such Closing Date, neither the Company nor any of its affiliates does
business with the government of Cuba or with any person or affiliate
located in Cuba.
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16
6. Covenants of the Company and the Selling
Stockholders. (A) The Company, and where specifically stated to be a covenant
of the Selling Stockholders, each of the Selling Stockholders, covenants and
agrees as follows:
(a) The Company shall prepare the Prospectus in a form
approved by the Representatives and file such Prospectus (or a term
sheet as permitted by Rule 434(b) under the Securities Act) pursuant
to Rule 424(b) under the Securities Act not later than the
Commission's close of business on the second business day following
the execution and delivery of this Agreement, or, if such second
business day would be more than fifteen business days after the
Effective Date of the Registration Statement or any post-effective
amendment thereto, such earlier date as would permit such Prospectus
to be filed without filing a post-effective amendment as set forth in
Rule 430A(a)(3) under the Securities Act, and shall promptly advise
the Representatives (i) when the Registration Statement shall have
become effective, (ii) when any amendment thereof shall have become
effective, (iii) of any request by the Commission for any amendment of
the Registration Statement or the Prospectus or for any additional
information, (iv) of the prevention or suspension of the use of any
preliminary prospectus or the Prospectus or of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any
proceeding for that purpose and (v) of the receipt by the Company of
any notification with respect to the suspension of the qualification
of the Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose. The Company shall not
file any amendment of the Registration Statement or amendment or
supplement to the Prospectus unless the Company has furnished the
Representatives a copy for its review prior to filing and shall not
file any such proposed amendment or supplement to which the
Representatives reasonably object. The Company shall use its best
efforts to prevent the issuance of any such stop order and, if issued,
to obtain as soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the
Shares is required to be delivered under the Securities Act and the
Rules, any event occurs 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 any material fact necessary to make the
statements therein in the light of the circumstances under which they
were made not misleading, or if it shall be necessary to amend or
supplement the Prospectus to comply with the Securities Act or the
Rules, the Company promptly shall prepare and file with the
Commission, subject to the second sentence of paragraph (a) of this
Section 6(A), an amendment or supplement which shall correct such
statement or omission or an amendment which shall effect such
compliance.
(c) The Company shall make generally available to its
security holders and to the Representatives as soon as practicable,
but not later than 45 days after the end of the 12-month period
beginning at the end of the fiscal quarter of the Company during which
the Effective Date occurs (or 90 days if such 12-month period
coincides with the Company's fiscal year), an earnings statement
(which need not be audited) of the Company, covering such 12-month
period, which shall satisfy the provisions of Section 11(a) of the
Securities Act or Rule 158 of the Rules.
(d) The Company shall furnish to the Representatives and
counsel for the Underwriters, without charge, signed copies of the
Registration Statement (including all exhibits thereto and amendments
thereof) and to each other Underwriter a copy of the Registration
Statement (without exhibits thereto) and all amendments thereof and,
so long as delivery of a prospectus by an Underwriter or dealer may be
required by the Securities Act or the Rules, as many copies of any
preliminary prospectus and the Prospectus and any amendments thereof
and supplements thereto as the Representatives may reasonably request.
(e) The Company and the Selling Stockholders shall
cooperate with the Representatives and their counsel in endeavoring to
qualify the Shares for offer and sale under the laws of such
- 16 -
17
jurisdictions as the Representatives may designate and shall maintain
such qualifications in effect so long as required for the distribution
of the Shares; provided, however, that neither the Company nor any
Selling Stockholder shall be required in connection therewith, as a
condition thereof, to qualify as a foreign corporation or to execute a
general consent to service of process in any jurisdiction or subject
itself to taxation as doing business in any jurisdiction.
(f) For a period of five years after the date of this
Agreement, the Company shall supply to the Representatives, and to
each other Underwriter who may so request in writing, copies of such
financial statements and other periodic and special reports as the
Company may from time to time distribute generally to the holders of
any class of its capital stock and furnish to the Representatives a
copy of each annual or other report it shall be required to file with
the Commission.
(g) Without the prior written consent of Xxxxxxxxxxx &
Co., Inc., for a period of 180 days after the date of this
Agreement, the Company shall not issue, sell or register with the
Commission, or otherwise encumber or dispose of, directly or
indirectly, any equity securities of the Company (or any securities
convertible into or exercisable or exchangeable for equity securities
of the Company), except for (i) the issuance of the Shares pursuant to
the Registration Statement and (ii) the issuance of shares pursuant to
the exercise of outstanding options or the grant or issuance of
options under the Company's existing stock option plans.
(h) On or before completion of this offering, the Company
shall make all filings required under applicable securities laws and
by the Nasdaq National Market (including any required registration
under the Exchange Act).
(B) The Company agrees to pay, or reimburse if paid by
the Representatives, whether or not the transactions contemplated hereby are
consummated or this Agreement is terminated, all costs and expenses of the
Company and the Selling Stockholders (other than costs and expenses of the
Selling Stockholders set forth in Section 6(C)) incident to the public offering
of the Shares and the performance of the obligations of the Company under this
Agreement including those relating to (i) the preparation, printing, filing and
distribution of the Registration Statement including all exhibits thereto, each
preliminary prospectus, the Prospectus, all amendments and supplements to the
Registration Statement and the Prospectus, and the printing, filing and
distribution of this Agreement; (ii) the preparation and delivery of
certificates for the Shares to the Underwriters; (iii) the registration or
qualification of the Shares for offer and sale under the securities or Blue Sky
laws of the various jurisdictions referred to in Section 6(A)(e), including the
fees and disbursements of counsel for the Underwriters in connection with such
registration and qualification and the preparation, printing, distribution and
shipment of preliminary and supplementary Blue Sky memoranda; (iv) the
furnishing (including costs of shipping and mailing) to the Representatives and
to the Underwriters of copies of each preliminary prospectus, the Prospectus
and all amendments or supplements to the Prospectus, and of the several
documents required by this Section to be so furnished, as may be reasonably
requested for use in connection with the offering and sale of the Shares by the
Underwriters or by dealers to whom Shares may be sold; (v) the filing fees of
the National Association of Securities Dealers, Inc. in connection with its
review of the terms of the public offering; (vi) the furnishing (including
costs of shipping and mailing) to the Representatives and to the Underwriters
of copies of all reports and information required by Section 6(A)(f); and (vii)
inclusion of the Shares for quotation on the Nasdaq National Market.
(C) Each Selling Stockholder agrees that it will pay (i)
all fees and expenses of such Selling Stockholder's counsel and (ii) all stock
transfer taxes, stamp duties and other similar taxes, if any, payable (A) upon
the sale or delivery of the Shares to be sold by such Selling Stockholder to
the Underwriters, (B) upon the purchase by the Underwriters of the Shares to be
sold by such Selling Stockholder, (C) upon resales of the Shares in connection
with the distribution contemplated hereby or (D) in connection with the
consummation by such Selling Stockholder of any of its obligations under this
Agreement
- 17 -
18
7. Indemnification.
(a) The Company and the Selling Stockholders jointly and
severally agree to indemnify and hold harmless each Underwriter
and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act against any and all losses, claims, damages and
liabilities, joint or several (including any reasonable investigation,
legal and other expenses incurred in connection with, and any amount
paid in settlement of, any action, suit or proceeding or any claim
asserted), to which they, or any of them, may become subject under the
Securities Act, the Exchange Act or other federal or state law or
regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact
contained in any preliminary prospectus, the Registration Statement or
the Prospectus or any amendment thereof or supplement thereto, or
arise out of or are based upon any omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided,
however, that such indemnity shall not inure to the benefit of any
Underwriter (or any person controlling such Underwriter) on account of
any losses, claims, damages or liabilities arising from the sale of
the Shares to any person by such Underwriter if such untrue statement
or omission or alleged untrue statement or omission was made in such
preliminary prospectus, the Registration Statement or the Prospectus,
or such amendment or supplement, in reliance upon and in conformity
with information furnished in writing to the Company by the
Representatives on behalf of any Underwriter specifically for use
therein. The Company and the Selling Stockholders may agree,
as among themselves and without limiting the rights of the
Underwriters under this Agreement, as to their respective amounts of
such liability for which they each shall be responsible. This
indemnity agreement will be in addition to any liability which the
Company or the Selling Stockholders may otherwise have.
(b) Each Underwriter agrees, severally and not jointly,
to indemnify and hold harmless the Company, the Selling Stockholders,
each person, if any, who controls the Company or the Selling
Stockholders within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, each director of the Company, and each
officer of the Company who signs the Registration Statement, to the
same extent as the foregoing indemnity from the Company and the
Selling Stockholders to each Underwriter, but only 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 which was made in any preliminary prospectus, the
Registration Statement or the Prospectus, or any amendment thereof or
supplement thereto, contained in the paragraphs relating to
stabilization on the inside front cover page of the Prospectus and the
third and seventh paragraphs under the caption "Underwriting" in the
Prospectus; provided, however, that the obligation of each Underwriter
to indemnify the Company or a Selling Stockholder (including any
controlling person, director or officer thereof) shall be limited to
the net proceeds received by the Company or such Selling Stockholder
from such Underwriter, or, with respect to a Selling Stockholder, an
amount not exceeding 60% of the product of (x) the Initial Price of
the Shares and (y) the number of shares being sold by such Selling
Stockholder.
(c) Any party that proposes to assert the right to be
indemnified under this Section will, promptly after receipt of notice
of commencement of any action, suit or proceeding against such party
in respect of which a claim is to be made against an indemnifying
party or parties under this Section, notify each such indemnifying
party of the commencement of such action, suit or proceeding,
enclosing
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19
a copy of all papers served. No indemnification provided for in
Section 7(a) or 7(b) shall be available to any party who shall fail to
give notice as provided in this Section 7(c) if the party to whom
notice was not given was unaware of the proceeding to which such
notice would have related and was prejudiced by the failure to give
such notice but the omission so to notify such indemnifying party of
any such action, suit or proceeding shall not relieve it from any
liability that it may have to any indemnified party for contribution
or otherwise than under this Section. In case any such action, suit
or proceeding shall be brought against any indemnified party and it
shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate in, and, to the
extent that it shall wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel
reasonably satisfactory to such indemnified party, and after notice
from the indemnifying party to such indemnified party of its election
so to assume the defense thereof and the approval by the indemnified
party of such counsel, the indemnifying party shall not be liable to
such indemnified party for any legal or other expenses, except as
provided below and except for the reasonable costs of investigation
subsequently incurred by such indemnified party in connection with the
defense thereof. The indemnified party shall have the right to employ
its counsel in any such action, but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless (i)
the employment of counsel by such indemnified party has been
authorized in writing by the indemnifying parties, (ii) the
indemnified party shall have reasonably concluded that there may be a
conflict of interest between the indemnifying parties and the
indemnified party in the conduct of the defense of such action (in
which case the indemnifying parties shall not have the right to direct
the defense of such action on behalf of the indemnified party) or
(iii) the indemnifying parties shall not have employed counsel to
assume the defense of such action within a reasonable time after
notice of the commencement thereof, in each of which cases the fees
and expenses of counsel shall be at the expense of the indemnifying
parties. An indemnifying party shall not be liable for any settlement
of any action, suit, proceeding or claim effected without its written
consent.
8. Contribution. In order to provide for just and
equitable contribution in circumstances in which the indemnification provided
for in Section 7 is due in accordance with its terms but for any reason is held
to be unavailable from the Company, the Selling Stockholders or the
Underwriters, the Company, the Selling Stockholders and the Underwriters shall
contribute to the aggregate losses, claims, damages and liabilities (including
any investigation, legal and other expenses reasonably incurred in connection
with, and any amount paid in settlement of, any action, suit or proceeding or
any claims asserted, but after deducting any contribution received by the
Company from persons other than the Underwriters, such as the Selling
Stockholders, persons who control the Company within the meaning of the
Securities Act, officers of the Company who signed the Registration Statement
and directors of the Company, who may also be liable for contribution) to which
the Company, the Selling Stockholders and one or more of the Underwriters may
be subject in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Selling Stockholders on the one hand
and the Underwriters on the other from the offering of the Shares or, if such
allocation is not permitted by applicable law or indemnification is not
available as a result of the indemnifying party not having received notice as
provided in Section 7 hereof, in such proportion as is appropriate to reflect
not only the relative benefits referred to above but also the relative fault of
the Company and the Selling Stockholders on the one hand and the Underwriters
on the other in connection with the statements or omissions which resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative benefits received by the
Company, the Selling Stockholders and the Underwriters shall be deemed to be in
the same proportion as (x) the total proceeds from the offering (net of
underwriting discount but before deducting expenses) received by the Company or
the Selling Stockholders, as set forth in the table on the cover page of the
Prospectus, bear to (y) the underwriting discount received by the Underwriters,
as set forth in the table on the cover page of the Prospectus. The relative
fault of the Company, the Selling Stockholders and the Underwriters shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact related to information supplied by the
Company, the Selling Stockholders or the Underwriters and
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20
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Company, the Selling
Stockholders and the Underwriters agree that it would not be just and equitable
if contribution pursuant to this Section 8 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of
the equitable considerations referred to above. Notwithstanding the provisions
of this Section 8, in no case shall any Underwriter (except as may be
provided in the Agreement Among Underwriters) be liable or responsible for any
amount in excess of the underwriting discount applicable to the Shares
purchased by such Underwriter hereunder. Notwithstanding the provisions of
this Section 8, 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. For purposes of this Section 8, each person, if any, who
controls an Underwriter within the meaning of Section 15 of the Securities Act
or Section 20(a) of the Exchange Act shall have the same rights to contribution
as such Underwriter, and each person, if any, who controls the Company or a
Selling Stockholder within the meaning of the Section 15 of the Securities Act
or Section 20(a) of the Exchange Act, each officer of the Company who shall
have signed the Registration Statement and each director of the Company shall
have the same rights to contribution as the Company or such Selling
Stockholder, as the case may be, subject in each case to clauses (i) and (ii)
in the second preceding sentence and to the immediately preceding sentence of
this Section 8. Any party entitled to contribution will, promptly after
receipt of notice of commencement of any action, suit or proceeding against
such party in respect of which a claim for contribution may be made against
another party or parties under this Section, notify such party or parties from
whom contribution may be sought, but the omission so to notify such party or
parties from whom contribution may be sought shall not relieve the party or
parties from whom contribution may be sought from any other obligation it or
they may have hereunder or otherwise than under this Section. No party shall be
liable for contribution with respect to any action, suit, proceeding or claim
settled without its written consent. The Underwriter's obligations to
contribute pursuant to this Section 8 are several in proportion to their
respective underwriting commitments and not joint.
9. Termination. This Agreement may be terminated with
respect to the Shares to be purchased on a Closing Date by the Representatives
by notifying the Company at any time
(a) in the absolute discretion of the Representatives at
or before any Closing Date: (i) if on or prior to such date, any
domestic or international event or act or occurrence has materially
disrupted, or in the opinion of the Representatives will in the future
materially disrupt, the securities markets; (ii) if there has occurred
any new outbreak or material escalation of hostilities or other
calamity or crisis the effect of which on the financial markets of the
United States is such as to make it, in the judgment of the
Representatives, inadvisable to proceed with the offering; (iii) if
there shall be such a material adverse change in general financial,
political or economic conditions or the effect of international
conditions on the financial markets in the United States is such as to
make it, in the judgment of the Representatives, inadvisable or
impracticable to market the Shares; (iv) if trading in the Shares has
been suspended by the Commission or trading generally on the New York
Stock Exchange, Inc. or on the American Stock Exchange, Inc. has been
suspended or limited, or minimum or maximum ranges for prices for
securities shall have been fixed, or maximum ranges for prices for
securities have been required, by said exchanges or by order of the
Commission, the National Association of Securities Dealers, Inc., or
any other governmental or regulatory authority; or (v) if a banking
moratorium has been declared by any state or federal authority, or
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(b) at or before any Closing Date, that any of the
conditions specified in Section 5 shall not have been fulfilled when
and as required by this Agreement.
If this Agreement is terminated pursuant to any of its
provisions, neither the Company nor the Selling Stockholders shall be under any
liability to any Underwriter, and no Underwriter shall be under any liability
to the Company or the Selling Stockholders, except that (y) if this Agreement
is terminated by the Representatives or the Underwriters because of any
failure, refusal or inability on the part of the Company or a Selling
Stockholder to comply with the terms or to fulfill any of the conditions of
this Agreement, the Company will reimburse the Underwriters for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
incurred by them in connection with the proposed purchase and sale of the
Shares or in contemplation of performing their obligations hereunder and (z) no
Underwriter who shall have failed or refused to purchase the Shares agreed to
be purchased by it under this Agreement, without some reason sufficient
hereunder to justify cancellation or termination of its obligations under this
Agreement, shall be relieved of liability to the Company, the Selling
Stockholders or to the other Underwriters for damages occasioned by its failure
or refusal.
10. Substitution of Underwriters. If one or more of the
Underwriters shall fail (other than for a reason sufficient to justify the
cancellation or termination of this Agreement under Section 9) to purchase on
any Closing Date the Shares agreed to be purchased on such Closing Date by such
Underwriter or Underwriters, the Representatives may find one or more
substitute underwriters to purchase such Shares or make such other arrangements
as the Representatives may deem advisable or one or more of the remaining
Underwriters may agree to purchase such Shares in such proportions as may be
approved by the Representatives, in each case upon the terms set forth in this
Agreement. If no such arrangements have been made by the close of business on
the business day following such Closing Date,
(a) if the number of Shares to be purchased by the
defaulting Underwriters on such Closing Date shall not exceed 10% of
the Shares that all the Underwriters are obligated to purchase on such
Closing Date, then each of the nondefaulting Underwriters shall be
obligated to purchase such Shares on the terms herein set forth in
proportion to their respective obligations hereunder; provided, that
in no event shall the maximum number of Shares that any Underwriter
has agreed to purchase pursuant to Section 1 be increased pursuant to
this Section 10 by more than one-ninth of such number of Shares
without the written consent of such Underwriter, or
(b) if the number of Shares to be purchased by the
defaulting Underwriters on such Closing Date shall exceed 10% of the
Shares that all the Underwriters are obligated to purchase on such
Closing Date, then the Company shall be entitled to an additional
business day within which it may, but is not obligated to, find one or
more substitute underwriters reasonably satisfactory to the
Representatives to purchase such Shares upon the terms set forth in
this Agreement.
In any such case, either the Representatives or the Company
shall have the right to postpone the applicable Closing Date for a period of
not more than five business days in order that necessary changes and
arrangements (including any necessary amendments or supplements to the
Registration Statement or Prospectus) may be effected by the Representatives
and the Company. If the number of Shares to be purchased on such Closing Date
by such defaulting Underwriter or Underwriters shall exceed 10% of the Shares
that all the Underwriters are obligated to purchase on such Closing Date, and
none of the nondefaulting Underwriters or the Company shall make arrangements
pursuant to this Section within the period stated for the purchase of the
Shares that the defaulting Underwriters agreed to purchase, this Agreement
shall terminate with respect to the Shares to be purchased on such Closing Date
without liability on the part of any nondefaulting Underwriter to the Company
or the Selling Stockholders and without liability on the part of the Company
and the Selling Stockholders, except in both cases as provided in Sections
6(B), 7, 8 and 9. The provisions of this Section shall not in any way affect
the liability of any defaulting Underwriter to the Company, the Selling
Stockholders or the
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non defaulting Underwriters arising out of such default. A substitute
underwriter hereunder shall become an Underwriter for all purposes of this
Agreement.
11. Miscellaneous. The respective agreements,
representations, warranties, indemnities and other statements of the Company or
its officers, of the Selling Stockholders and of the Underwriters set forth in
or made pursuant to this Agreement shall remain in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter any
Selling Stockholder or the Company or any of the officers, directors or
controlling persons referred to in Sections 7 and 8 hereof, and shall survive
delivery of and payment for the Shares. The provisions of Sections 6(B), 7, 8
and 9 shall survive the termination or cancellation of this Agreement.
This Agreement has been and is made for the benefit of the
Underwriters, the Company and the Selling Stockholders and their respective
successors and assigns, and, to the extent expressed herein, for the benefit of
persons controlling any of the Underwriters, the Company or the Selling
Stockholders, and directors and officers of the Company, the Selling
Stockholders, if any, and their respective successors and assigns, and no other
person shall acquire or have any right under or by virtue of this Agreement.
The term "successors and assigns" shall not include any purchaser of Shares
from any Underwriter merely because of such purchase.
All notices and communications hereunder shall be in writing
and mailed or delivered or by telephone or telegraph if subsequently confirmed
in writing, (a) if to the Representatives, c/o Oppenheimer & Co., Inc.,
Xxxxxxxxxxx Xxxxx, Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 Attention:
Xxxxxxx X. Xxxxx, (b) if to the Company, to its agent for service as such
agent's address appears on the cover page of the Registration Statement and (c)
if to the Selling Stockholders, to the address set forth in the Custody
Agreement and Power of Attorney.
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This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
Please confirm that the foregoing correctly sets forth the
agreement among us.
Very truly yours,
MICRODYNE CORPORATION
By
-----------------------------------------
Title: President and Chief Executive Officer
THE SELLING STOCKHOLDERS NAMED
ON SCHEDULE II HERETO
By
-----------------------------------------
Attorney-in-Fact
Confirmed:
XXXXXXXXXXX & CO., INC.
Acting severally on behalf
of itself and as representative
of the several Underwriters
named in Schedule I annexed hereto.
By Xxxxxxxxxxx & Co., Inc.
By
-----------------------------------
Title: Managing Director
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SCHEDULE I
NUMBER OF
FIRM SHARES TO
NAME BE PURCHASED
---- ------------
Xxxxxxxxxxx & Co. Inc. . . . . . . . . . . . .
Xxxxxxxx Xxxxxxxx & Co., Incorporated . . . . .
Xxxxxx Xxxxxxx Incorporated . . . . . . . . . .
TOTAL 3,500,000
=========
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25
SCHEDULE II
SELLING STOCKHOLDERS
NUMBER OF FIRM NUMBER OF OPTION
SHARES TO BE OFFERED SHARES TO BE OFFERED
NAME BY SELLING STOCKHOLDERS BY SELLING STOCKHOLDERS
---- ----------------------- -----------------------
Xxxxxx X. Xxxxxxxxxx . . . . . . . . 1,369,797 525,000
Xxxxxxxxxxx X. Xxxxxxxxx . . . . . . 100,000 --
R. Xxxx X'Xxxxxxx . . . . . . . . . . 30,203 --
--------- -------
TOTAL 1,500,000 525,000
========= =======
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