EXHIBIT 1.1
SAWTEK INC.
4,000,000 Shares/1/
Common Stock
FORM OF UNDERWRITING AGREEMENT
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January __, 0000
XXXXXXXXX & XXXXX LLC
CIBC World Markets Corp.
Banc of America Securities LLC
x/x Xxxxxxxxx & Xxxxx LLC
Xxx Xxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Ladies and Gentlemen:
Certain shareholders of Sawtek Inc., a Florida corporation (herein called
the Company), named in Schedule II hereto (herein collectively called the
Selling Securityholders) propose to sell an aggregate of 4,000,000 shares of
Common Stock, par value $0.0005 per share (herein called the Common Stock), of
the Company (said shares of Common Stock being herein called the Underwritten
Stock). Certain Selling Securityholders, also as set forth on Schedule II,
propose to grant to the Underwriters (as hereinafter defined) an option to
purchase up to 600,000 additional shares of Common Stock (herein called the
Option Stock and with the Underwritten Stock herein collectively called the
Stock). The Common Stock is more fully described in the Registration Statement
and the Prospectus hereinafter mentioned.
The Company and the Selling Securityholders severally hereby confirm the
agreements made with respect to the purchase of the Stock by the several
underwriters, for whom you are acting, named in Schedule I hereto (herein
collectively called the Underwriters, which term shall also include any
underwriter purchasing Stock pursuant to Section 3(b) hereof). You represent
and warrant that you have been authorized by each of the other Underwriters to
enter into this Agreement on its behalf and to act for it in the manner herein
provided.
1. Registration Statement. The Company has filed with the Securities and
Exchange Commission (herein called the Commission) a registration statement on
Form S-3 (No. 333-92527), including the related preliminary prospectus, for the
registration under the Securities Act of 1933, as amended (herein called the
Securities Act) of the Stock. Copies of such registration statement and of each
amendment thereto, if any, including the related preliminary prospectus (meeting
the requirements of Rule 430A of the rules and regulations of the Commission)
heretofore filed by the Company with the Commission have been delivered to you.
The term Registration Statement as used in this agreement shall mean such
registration statement, including all documents incorporated by reference
therein, all exhibits and financial statements, all information omitted
therefrom in reliance upon Rule 430A and contained in the Prospectus referred to
below, in the form in which it became effective, and any registration statement
filed pursuant to Rule 462(b) of the rules and regulations of the Commission
with respect to the Stock (herein called a Rule 462(b) registration statement),
and, in the event of any
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/1/ Plus an option to purchase from certain Selling Securityholders up to
600,000 additional shares to cover over-allotments.
amendment thereto after the effective date of such registration statement
(herein called the Effective Date), shall also mean (from and after the
effectiveness of such amendment) such registration statement as so amended
(including any Rule 462(b) registration statement). The term Prospectus as used
in this Agreement shall mean the prospectus, including the documents
incorporated by reference therein, relating to the Stock first filed with the
Commission pursuant to Rule 424(b) and Rule 430A (or if no such filing is
required, as included in the Registration Statement) and, in the event of any
supplement or amendment to such prospectus after the Effective Date, shall also
mean (from and after the filing with the Commission of such supplement or the
effectiveness of such amendment) such prospectus as so supplemented or amended.
The term Preliminary Prospectus as used in this Agreement shall mean each
preliminary prospectus, including the documents incorporated by reference
therein, included in such registration statement prior to the time it becomes
effective.
The Registration Statement has been declared effective under the Securities
Act, and no post-effective amendment to the Registration Statement has been
filed as of the date of this Agreement. The Company has caused to be delivered
to you copies of each Preliminary Prospectus and has consented to the use of
such copies for the purposes permitted by the Securities Act.
2. Representations and Warranties of the Company and the Selling
Securityholders.
(a) The Company hereby represents and warrants as follows:
(i) Each of the Company and its subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has full corporate
power and authority to own or lease its properties and conduct its business
as described in the Registration Statement and the Prospectus and as being
conducted, and is duly qualified as a foreign corporation and in good
standing in all jurisdictions in which the character of the property owned
or leased or the nature of the business transacted by it makes
qualification necessary (except where the failure to be so qualified would
not have a material adverse effect on the business, properties, financial
condition or results of operations of the Company and its subsidiaries,
taken as a whole).
(ii) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, there has not been any
materially adverse change in the business, properties, financial condition
or results of operations of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of
business, other than as set forth in the Registration Statement and the
Prospectus, and since such dates, except in the ordinary course of
business, neither the Company nor any of its subsidiaries has entered into
any material transaction not referred to in the Registration Statement and
the Prospectus.
(iii) The Registration Statement and the Prospectus comply, and on
the Closing Date (as hereinafter defined) and any later date on which
Option Stock is to be purchased, the Prospectus will comply, in all
material respects, with the provisions of the Securities Act and the
Securities Exchange Act of 1934, as amended (herein called the Exchange
Act), and the rules and regulations of the Commission thereunder; on the
Effective Date, the Registration Statement did not contain any untrue
statement of a material fact and did not 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 Effective Date the Prospectus did not
and, on the Closing Date and any later date on which Option Stock is to be
purchased, will not contain any untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that none of the representations and
warranties in this subparagraph (iii) shall apply to statements in, or
omissions from, the Registration Statement or the Prospectus made in
reliance upon and in conformity with information herein or otherwise
furnished in writing to the Company by or on behalf of the Underwriters for
use in the Registration Statement or the Prospectus.
(iv) The Company has filed all required tax returns and has paid all
taxes shown thereon as due, and there is no tax deficiency that has been
asserted against the Company that will have a material adverse effect on
the Company and its subsidiaries taken as a whole, and all tax liabilities
are adequately provided for on the books of the Company.
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(v) The Company's authorized, issued and outstanding
capitalization as of September 30, 1999 is as set forth under the caption
"Capitalization" in the Prospectus, and all of the outstanding shares of
such capital stock have been duly authorized and validly issued and are
fully paid and nonassessable. The Stock is duly and validly authorized, is
duly and validly issued, fully paid and nonassessable and conforms to the
description thereof in the Prospectus. No further approval or authority of
the shareholders or the Board of Directors of the Company will be required
for the transfer and sale of the Stock to be sold by the Selling
Securityholders as contemplated herein. The holders of outstanding shares
of capital stock of the Company are not entitled to preemptive or other
similar rights in connection with the purchase and sale of Stock
contemplated by this Agreement, and there are no restrictions upon the
voting or transfer of any of the capital stock of the Company pursuant to
the Company's Articles of Incorporation or Bylaws or any agreement or other
outstanding instrument to which the Company is a party or by which it is
bound. All of the issued and outstanding capital stock of each of the
subsidiaries of the Company has been duly authorized and validly issued and
is fully paid and nonassessable and is owned by the Company free and clear
of all liens, encumbrances and security interests.
(vi) The Stock to be sold by the Selling Securityholders is listed
and duly admitted to trading on the Nasdaq National Market.
(vii) Except as set forth in the Prospectus, there are no
outstanding securities convertible into or exchangeable for, or warrants,
rights or options to purchase from the Company, or obligations of the
Company or any of its subsidiaries to issue, shares of capital stock of the
Company or any of its subsidiaries.
(viii) The Company is not, nor with the giving of notice or lapse of
time or both will be, in violation of or in default (A) under its Articles
of Incorporation or Bylaws, or (B) under any indenture or other agreement
or instrument to which the Company or any of its subsidiaries is a party,
or by which they, or any of their properties, are bound, and which would
have a material adverse effect on the condition, results of operations or
business of the Company and its subsidiaries, taken as a whole. Neither (A)
the sale of the Stock or (B) the consummation by the Company of any other
of the transactions contemplated herein, will conflict with or result in a
breach or violation of or constitute a default under or result in the
creation or imposition of any lien, charge or encumbrance upon any
properties or assets of the Company or any of its subsidiaries pursuant to
the organization documents of the Company or its subsidiaries, the terms of
any indenture or other agreement or instrument to which the Company or any
of its subsidiaries is a party, or any order or regulation applicable to
the Company or any of its subsidiaries of any court, regulatory body,
administrative agency, governmental body or arbitration body having
jurisdiction over the Company or any of its subsidiaries, except where such
conflicts, breaches, violations, defaults, liens, charges or encumbrances
would not have a material adverse effect on the business, properties or
consolidated financial condition or results of operations of the Company
and its subsidiaries taken as a whole.
(ix) The Company has full legal right, power and authority to
enter into this Agreement and perform the transactions contemplated hereby.
This Agreement has been duly authorized, executed and delivered by the
Company and is a legal, valid and binding obligation of the Company
enforceable in accordance with its terms.
(x) The Company has all necessary consents, authorizations,
approvals, orders, certificates and permits of and from, and has made all
declarations and filings with, all governmental authorities, to own, lease,
license and use its properties and assets and to conduct its business in
the manner described in the Prospectus, except to the extent that the
failure to obtain or file such would not have a material adverse effect on
the Company.
(xi) No consent, approval, authorization or order of any court or
governmental agency, person or body, the Company's shareholders, or
pursuant to applicable law is required for the consummation of the
transactions contemplated herein, except such as have been obtained or may
be required under the blue sky laws of any jurisdiction or by the National
Association of Securities Dealers, Inc. (herein called NASD) in
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connection with the purchase of Stock and distribution of the Stock by the
Underwriters and such other approvals as have been obtained and which are
in full force and effect.
(xii) Ernst & Young LLP, which has audited the consolidated
financial statements of the Company included in the Registration Statement,
are independent public accountants within the meaning of the Securities Act
and the applicable rules and regulations thereunder; the historical
financial statements, together with the related financial notes and
schedules, included in the Registration Statement and the Prospectus
(herein called the Financial Information) comply in all material respects
with the requirements of the Securities Act and fairly present in all
material respects the financial position, results of operations and cash
flows of the Company and its subsidiaries at the respective dates and for
the respective periods indicated. The Financial Information has been
prepared in accordance with generally accepted accounting principles
(herein called GAAP), applied on a consistent basis throughout all periods
specified and as presented in the Prospectus and as required by the
Securities Act or the rules and regulations thereunder to be included in
the Registration Statement and the Prospectus. No other financial
statements or schedules are required to be included in the Registration
Statement. The financial information and financial data set forth in the
Prospectus under the captions "Summary Consolidated Financial Data,"
"Capitalization" and "Selected Consolidated Financial Data" are derived
from the accounting records of the Company and its subsidiaries, and are a
fair representation in all material respects of the data purported to be
shown in accordance with GAAP. Since the respective dates as of which the
information is given in the Registration Statement and the Prospectus,
there has not been a material adverse change in the business, properties,
financial condition or results of operations of the Company and its
subsidiaries taken as a whole.
(xiii) There are no contracts, agreements or understandings between
the Company and any person granting such person the right (other than
rights which have been waived or satisfied) to require the Company to file
a registration statement under the Securities Act with respect to any
securities of the Company owned or to be owned by such person or to require
the Company to include such securities in the securities registered
pursuant to the Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Securities Act.
(xiv) The Company carries, or is covered by, insurance in such
amounts and covering such risks as is adequate for the conduct of its
business and the value of its properties and as is customary for companies
engaged in similar businesses in similar industries.
(xv) The Company and its subsidiaries own or possess adequate
rights to use all material patents (or foreign equivalents), patent
applications, trademarks, trademark registrations, service marks, service
xxxx registrations, trade names, licenses, copyrights and proprietary or
other confidential information necessary for the conduct of their
respective businesses except such as the failure to so own or possess would
not have a material adverse effect on the Company and its subsidiaries
taken as a whole. To the Company's knowledge, the conduct of business of
the Company and its subsidiaries will not conflict with, and neither the
Company nor any of its subsidiaries has received any notice of any claim of
infringement or conflict with, the rights of others in respect thereof.
(xvi) The Company has good and marketable title to all of the
properties and assets as described in the Prospectus or as reflected in the
financial statements filed with the Commission as part of the Registration
Statement, free and clear of any lien, mortgage, pledge, charge or
encumbrance of any kind except those reflected in such financial statements
or as described in the Prospectus. All leases to which the Company is a
party are valid and binding obligations of the Company and no default by
the Company has occurred or is continuing thereunder, and the Company
enjoys peaceful and undisturbed possession under all such leases to which
it is a party as lessee.
(xvii) There is no legal or governmental proceeding pending or
threatened to which the Company or any of its subsidiaries is a party or to
which any of the properties of the Company or any of its subsidiaries is
subject that is required to be described in the Registration Statement or
the Prospectus and is not so described or that could reasonably be expected
to prevent the consummation of the transactions contemplated hereby; or any
statute, regulation, contract or other document that is required to be
described
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in the Registration Statement or the Prospectus or to be filed as an
exhibit to the Registration Statement that is not described or filed.
(xviii) No labor disturbance by the employees of the Company or any
of its subsidiaries exists or, to the knowledge of the Company, is imminent
which might be expected to have a material adverse effect on the business,
properties, financial condition or results of operations of the Company and
its subsidiaries taken as a whole.
(xix) The Company is in compliance in all material respects with
all presently applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations and published
interpretations thereunder ("ERISA"); no "reportable event" (as defined in
ERISA) has occurred with respect to any "pension plan" (as defined in
ERISA) for which the Company would have any liability; the Company has not
incurred and does not expect to incur liability under (i) Title IV of ERISA
with respect to termination of, or withdrawal from, any "pension plan" or
(ii) Sections 412 or 4971 of the Internal Revenue Code of 1986, as amended,
including the regulations and published interpretations thereunder (the
"Code"); and each pension plan for which the Company would have any
liability that is intended to be qualified under Section 401(a) of the Code
is so qualified in all material respects and nothing has occurred, whether
by action or by failure to act, which would cause the loss of such
qualification.
(xx) There has been no storage, disposal, generation, manufacture,
refinement, transportation, handling or treatment of toxic wastes, medical
wastes, hazardous wastes or hazardous substances by the Company or any of
its subsidiaries (or, to the knowledge of the Company, any of their
predecessors in interest) at, upon or from any of the Property now or
previously owned or leased by the Company or any of its subsidiaries in
violation of any applicable law, ordinance, rule, regulation, order,
judgment, decree or permit or which would require remedial action under any
applicable law, ordinance, rule, regulation, order, judgment, decree or
permit, except for any violation or remedial action which would not have,
or could not be reasonably likely to have, singularly or in the aggregate
with all such violations and remedial actions, a material adverse effect on
the business, properties, financial condition or results of operations of
the Company and its subsidiaries taken as a whole; there has been no
material spill, discharge, leak, emission, injection, escape, dumping or
release of any kind onto such property or into the environment surrounding
such property of any toxic wastes, medical wastes, solid wastes, hazardous
wastes or hazardous substances due to or caused by the Company or with
respect to which the Company has knowledge, except for any such spill,
discharge, leak, emission, injection, escape, dumping or release which
would not have or would not be reasonably likely to have, singularly or in
the aggregate with all such spills, discharges, leaks, emissions,
injections, escapes, dumpings and releases, a material adverse effect on
the business, properties, financial condition or results of operations of
the Company and its subsidiaries taken as a whole; and the terms "hazardous
wastes", "toxic wastes", "hazardous substances" and "medical wastes" shall
have the meanings specified in any applicable local, state, federal and
foreign laws or regulations with respect to environmental protection.
(xxi) Neither the Company nor any of its subsidiaries has at any
time during the last five years (i) made any unlawful contribution to any
candidate for foreign office, or failed to disclose fully any contribution
in violation of law, (ii) made any payment to any federal or state
governmental officer or official, or other person charged with similar
public or quasi-public duties, other than payments required or permitted by
the laws of the United States or any jurisdiction thereof, or (iii)
violated the Foreign Corrupt Practices Act of 1977, as amended.
(xxii) The Commission has not issued an order preventing or
suspending the use of any Prospectus relating to the proposed offering of
the Stock, nor, to the best knowledge of the Company, instituted
proceedings for that purpose.
(xxiii) The Company has not taken, directly or indirectly, any action
designed 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 shares of Common Stock to facilitate the sale or resale of
the Stock.
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(xxiv) The Company maintains a system of internal accounting
controls sufficient to provide reasonable assurances that (i) transactions
are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (iii)
access to assets is permitted only in accordance with management's general
or specific authorization; and (iv) the recorded accountability for assets
is compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(xxv) There are no issues related to the Company's preparedness for
the Year 2000 that (i) are of a character required to be described or
referred to in the Registration Statement or Prospectus by the Securities
Act or the rules and regulations of the Commission thereunder which have
not been accurately described in the Registration Statement or Prospectus
or (ii) might reasonably be expected to result in any material adverse
effect on the condition, results of operations or business of the Company
and its subsidiaries, taken as a whole. Except as set forth in the
Registration Statement, all internal computer systems and each Constituent
Component (as defined below) of those systems and all computer-related
products, and each Constituent Component of those products of the Company,
fully comply with the Year 2000 Qualification Requirements. "Year 2000
Qualification Requirements" means that the internal computer systems and
each Constituent Component of those systems and all computer-related
products and each Constituent Component of those products of the Company
(i) have been reviewed to confirm that they store, process (including
sorting and performing mathematical operations, calculations and
computations), input and output data containing date and information
correctly regardless of whether the date contains dates and times before,
on or after January 1, 2000, (ii) have been designated to ensure date and
time entry recognition, calculations that accommodate same century and
multi-century formulas and date values, leap year recognition and
calculations, and date data interface values that reflect the century,
(iii) accurately manage and manipulate data involving dates and times,
including single century formulas and multi-century formulas, and will not
cause an abnormal ending scenario within the application or generate
incorrect values or invalid results involving such dates, (iv) accurately
process any date rollover and (v) accept and respond to two-digit year date
input in a manner that resolves any ambiguities as to the century.
"Constituent Component" means all software (including operating systems,
programs, packages and utilities), firmware, hardware, networking
components, and peripherals provided as part of the configuration.
(xxvi) The Company has not distributed and will not distribute,
prior to the later of (A) the Closing Date, or any later date on which
Option Stock is to be purchased, as the case may be, and (B) completion of
the distribution of the Stock, any offering material in connection with the
offering and sale of the Stock other than any Preliminary Prospectus, the
Prospectus, the Registration Statement and such other materials, if any,
permitted by the Securities Act.
(xxvii) The Company has not taken and will not take any actions in
connection with the sale of Stock to be sold hereunder that violate any
provision of the Securities Act or the Exchange Act, the rules and
regulations of the Commission thereunder, or any applicable state
securities laws.
(b) Each of the Selling Securityholders hereby represents and warrants as
follows:
(i) Such Selling Securityholder has good and marketable title to
all the shares of Stock to be sold by such Selling Securityholder
hereunder, free and clear of all liens, encumbrances, equities, security
interests and claims whatsoever, with full right and authority to deliver
the same hereunder, subject, in the case of each Selling Securityholder, to
the rights of SunTrust Bank, Central Florida, N.A., as Custodian (herein
called the Custodian), and that upon the delivery of and payment for such
shares of the Stock hereunder, the several Underwriters will receive good
and marketable title thereto, free and clear of all liens, encumbrances,
equities, security interests and claims whatsoever.
(ii) Certificates in negotiable form for the shares of the Stock
to be sold by such Selling Securityholder have been placed in custody under
a Custody Agreement for delivery under this Agreement with the Custodian;
such Selling Securityholder specifically agrees that the shares of the
Stock represented by the certificates so held in custody for such Selling
Securityholder are subject to the interests of the
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several Underwriters and the Company, that the arrangements made by such
Selling Securityholder for such custody, including (except with respect to
the Sawtek Inc. Employee Stock Ownership Plan and 401(k) Plan) (herein
called the ESOP) the Power of Attorney provided for in such Custody
Agreement, are to that extent irrevocable, and that the obligations of such
Selling Securityholder shall not be terminated by any act of such Selling
Securityholder or by operation of law, whether by the death or incapacity
of such Selling Securityholder (or, in the case of a Selling Securityholder
that is not an individual, the dissolution or liquidation of such Selling
Securityholder) or the occurrence of any other event; if any such death,
incapacity, dissolution, liquidation or other such event should occur
before the delivery of such shares of the Stock hereunder, certificates for
such shares of the Stock shall be delivered by the Custodian in accordance
with the terms and conditions of this Agreement as if such death,
incapacity, dissolution, liquidation or other event had not occurred,
regardless of whether the Custodian shall have received notice of such
death, incapacity, dissolution, liquidation or other event.
(iii) Each Selling Securityholder identified on Schedule II as a
Major Selling Securityholder represents and warrants that the Registration
Statement and the Prospectus comply, and on the Closing Date and any later
date on which Option Stock is to be purchased, the Prospectus will comply,
in all material respects, with the provisions of the Securities Act and the
Exchange Act, and the rules and regulations of the Commission thereunder;
on the Effective Date, the Registration Statement did not contain any
untrue statement of a material fact and did not 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 Effective Date the
Prospectus did not and, on the Closing Date and any later date on which
Option Stock is to be purchased, will not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that none of the
representations and warranties in this subparagraph (iii) shall apply to
statements in, or omissions from, the Registration Statement or the
Prospectus made in reliance upon and in conformity with information herein
or otherwise furnished in writing to the Company by or on behalf of the
Underwriters for use in the Registration Statement or the Prospectus.
(iv) All information furnished in writing by or on behalf of such
Selling Securityholder for use in the Registration Statement and Prospectus
is, and on the Closing Date and any later date on which Option Stock is to
be purchased will be, true, correct and complete, and does not, and on the
Closing Date and any later date on which Option Stock is to be purchased
will not, contain any untrue statement of a material fact or omit to state
any material fact necessary to make such information not misleading.
(v) Neither the sale of the Stock to be sold by such Selling
Securityholder to the Underwriters nor the consummation of any other of the
transactions herein contemplated by such Selling Securityholder will
conflict with or result in a breach or violation of or constitute a default
under or result in the creation or imposition of any lien, charge or
encumbrance upon any properties or assets of such Selling Securityholder
pursuant to the organization documents of such Selling Securityholder (if
applicable), the terms of any indenture or other agreement or instrument to
which such Selling Securityholder is a party, or any order or regulation
applicable to such Selling Securityholder of any court, regulatory body,
administrative agency, governmental body or arbitration body having
jurisdiction over such Selling Securityholder, except where such conflicts,
breaches, violations, defaults, liens, charges or encumbrances would not
have a material adverse effect on such Selling Securityholder.
(vi) With respect to the ESOP, the sale of the Stock to be sold by
such Selling Securityholder to the Underwriters will not, in whole or in
part, constitute a prohibited transaction pursuant to Section 4975(c) of
the Code or a party-in-interest transaction pursuant to Section 406 of
ERISA, and none of the Underwriters or any person or entity affiliated with
them is a "fiduciary" (as such term is defined in Section 3(21) of ERISA)
of such Selling Securityholder or a "named fiduciary" (as such term is
defined in Section 402(a)(2) of ERISA) of such Selling Securityholder.
(vii) Such Selling Securityholder has full legal right, power and
authority to enter into this Agreement and perform the transactions
contemplated hereby. This Agreement has been duly authorized,
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executed and delivered by or on behalf of such Selling Securityholder and
is a legal, valid and binding obligation of such Selling Securityholder
enforceable in accordance with its terms.
(viii) Such Selling Securityholder has not distributed and will not
distribute, prior to the later of (A) the Closing Date, or any later date
on which Option Stock is to be purchased, as the case may be, and (B)
completion of the distribution of the Stock, any offering material in
connection with the offering and sale of the Stock other than any
Preliminary Prospectus, the Prospectus, the Registration Statement and such
other materials, if any, permitted by the Securities Act .
(ix) Such Selling Securityholder has not taken and will not take
any actions in connection with the sale of Stock to be sold by such Selling
Securityholder that violate any provision of the Securities Act or the
Exchange Act, the rules and regulations of the Commission thereunder, or
any applicable state securities laws.
3. Purchase of the Stock by the Underwriters.
(a) On the basis of the representations and warranties and subject to the
terms and conditions herein set forth, each Selling Securityholder agrees to
sell to the several Underwriters the number of shares of the Underwritten Stock
set forth in Schedule II opposite the name of such Selling Securityholder, and
each of the Underwriters agrees to purchase from the Company and the Selling
Securityholders the respective aggregate number of shares of Underwritten Stock
set forth opposite its name in Schedule I. The price at which such shares of
Underwritten Stock shall be sold by the Company and the Selling Securityholders
and purchased by the several Underwriters shall be $___ per share. The
obligation of each Underwriter to each of the Selling Securityholders shall be
to purchase from the Selling Securityholders that number of shares of the
Underwritten Stock which represents the same proportion of the total number of
shares of the Underwritten Stock to be sold by each of the Company and the
Selling Securityholders pursuant to this Agreement as the number of shares of
the Underwritten Stock set forth opposite the name of such Underwriter in
Schedule I hereto represents of the total number of shares of the Underwritten
Stock to be purchased by all Underwriters pursuant to this Agreement, as
adjusted by you in such manner as you deem advisable to avoid fractional shares.
In making this Agreement, each Underwriter is contracting severally and not
jointly; except as provided in paragraphs (b) and (c) of this Section 3, the
agreement of each Underwriter is to purchase only the respective number of
shares of the Underwritten Stock specified in Schedule I.
(b) If for any reason one or more of the Underwriters shall fail or
refuse (otherwise than for a reason sufficient to justify the termination of
this Agreement under the provisions of Section 8 or 9 hereof) to purchase and
pay for the number of shares of the Stock agreed to be purchased by such
Underwriter or Underwriters, the Selling Securityholders shall immediately give
notice thereof to you, and the non-defaulting Underwriters shall have the right
within 24 hours after the receipt by you of such notice to purchase, or procure
one or more other Underwriters to purchase, in such proportions as may be agreed
upon between you and such purchasing Underwriter or Underwriters and upon the
terms herein set forth, all or any part of the shares of the Stock which such
defaulting Underwriter or Underwriters agreed to purchase. If the non-defaulting
Underwriters fail so to make such arrangements with respect to all such shares
and portion, the number of shares of the Stock which each non-defaulting
Underwriter is otherwise obligated to purchase under this Agreement shall be
automatically increased on a pro rata basis to absorb the remaining shares and
portion which the defaulting Underwriter or Underwriters agreed to purchase;
provided, however, that the non-defaulting Underwriters shall not be obligated
to purchase the shares and portion which the defaulting Underwriter or
Underwriters agreed to purchase if the aggregate number of such shares of the
Stock exceeds 10% of the total number of shares of the Stock which all
Underwriters agreed to purchase hereunder. If the total number of shares of the
Stock which the defaulting Underwriter or Underwriters agreed to purchase shall
not be purchased or absorbed in accordance with the two preceding sentences, the
Selling Securityholders shall have the right, within 24 hours next succeeding
the 24-hour period above referred to, to make arrangements with other
underwriters or purchasers satisfactory to you for purchase of such shares and
portion on the terms herein set forth. In any such case, either you or the
Company and the Selling Securityholders shall have the right to postpone the
Closing Date determined as provided in Section 5 hereof for not more than seven
business days after the date originally fixed as the Closing Date pursuant to
said Section 5 in order that any necessary changes in the Registration
Statement, the Prospectus or any other documents or arrangements may be made. If
neither the non-defaulting Underwriters nor the Selling Securityholders shall
make arrangements within the 24-hour
8
periods stated above for the purchase of all the shares of the Stock which the
defaulting Underwriter or Underwriters agreed to purchase hereunder, this
Agreement shall be terminated without further act or deed and without any
liability on the part of the Company or the Selling Securityholders to any non-
defaulting Underwriter and without any liability on the part of any non-
defaulting Underwriter to the Company or the Selling Securityholders. Nothing in
this paragraph (b), and no action taken hereunder, shall relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
(c) On the basis of the representations, warranties and covenants herein
contained, and subject to the terms and conditions herein set forth, the Selling
Securityholders indicated on Schedule II as those selling Option Stock grant an
option to the several Underwriters to purchase, severally and not jointly, up to
600,000 shares in the aggregate of the Option Stock from those Selling
Securityholders at the same price per share as the Underwriters shall pay for
the Underwritten Stock. Said option may be exercised only to cover over-
allotments in the sale of the Underwritten Stock by the Underwriters and may be
exercised in whole or in part at any time (but not more than once) on or before
the thirtieth day after the date of this Agreement upon written or telegraphic
notice by you to the Company setting forth the aggregate number of shares of the
Option Stock as to which the several Underwriters are exercising the option.
Delivery of certificates for the shares of Option Stock, and payment therefor,
shall be made as provided in Section 5 hereof. The number of shares of the
Option Stock to be purchased by each Underwriter shall be the same percentage of
the total number of shares of the Option Stock to be purchased by the several
Underwriters as such Underwriter is purchasing of the Underwritten Stock, as
adjusted by you in such manner as you deem advisable to avoid fractional shares.
4. Offering by Underwriters.
(a) The terms of the initial public offering by the Underwriters of the
Stock to be purchased by them shall be as set forth in the Prospectus. The
Underwriters may from time to time change the public offering price after the
closing of the initial public offering and increase or decrease the concessions
and discounts to dealers as they may determine.
(b) The information set forth in the fourth paragraph on the front cover
page and under "Underwriting" in the Registration Statement, any Preliminary
Prospectus and the Prospectus relating to the Stock filed by the Company
(insofar as such information relates to the Underwriters) constitutes the only
information furnished by the Underwriters to the Company for inclusion in the
Registration Statement, any Preliminary Prospectus, and the Prospectus, and you
on behalf of the respective Underwriters represent and warrant to the Company
that the statements made therein are correct.
5. Delivery of and Payment for the Stock.
(a) Delivery of certificates for the shares of the Underwritten Stock and
the Option Stock (if the option granted by Section 3(c) hereof shall have been
exercised not later than 7:00 a.m., San Francisco time, on the date two business
days preceding the Closing Date), and payment therefor, shall be made at the
offices of Xxxxx, Day, Xxxxxx & Xxxxx, 3500 SunTrust Plaza, 000 Xxxxxxxxx
Xxxxxx, X.X., Xxxxxxx, Xxxxxxx 00000-0000, at 7:00 a.m., San Francisco time, on
the fourth business day after the date of this Agreement, or at such time on
such other day, not later than seven full business days after such fourth
business day, as shall be agreed upon in writing by the Company, the Selling
Securityholders and you. The date and hour of such delivery and payment (which
may be postponed as provided in Section 3(b) hereof) are herein called the
Closing Date.
(b) If the option granted by Section 3(c) hereof shall be exercised after
7:00 a.m., San Francisco time, on the date two business days preceding the
Closing Date, delivery of certificates for the shares of Option Stock, and
payment therefor, shall be made at the offices of Xxxxx, Day, Xxxxxx & Xxxxx,
3500 SunTrust Plaza, 000 Xxxxxxxxx Xxxxxx, X.X., Xxxxxxx, Xxxxxxx 00000-0000, at
7:00 a.m., San Francisco time, on the third business day after the exercise of
such option.
(c) Payment for the Stock purchased from the Selling Securityholders
shall be made to the Custodian, for the account of the Selling Securityholders,
in each case by one or more certified or official bank check or checks in next
day funds (and the Selling Securityholders agree not to deposit any such check
in the bank on which drawn until the day following the date of its delivery to
the Custodian). Such payment shall be made upon delivery of
9
certificates for the Stock to you for the respective accounts of the several
Underwriters against receipt therefor signed by you. Certificates for the Stock
to be delivered to you shall be registered in such name or names and shall be in
such denominations as you may request at least one business day before the
Closing Date, in the case of Underwritten Stock, and at least one business day
prior to the purchase thereof, in the case of the Option Stock. Such
certificates will be made available to the Underwriters for inspection, checking
and packaging at the offices of Lewco Securities Corporation, 0 Xxxxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 on the business day prior to the Closing Date or, in the
case of the Option Stock, by 3:00 p.m., New York time, on the business day
preceding the date of purchase.
It is understood that you, individually and not on behalf of the
Underwriters, may (but shall not be obligated to) make payment to the Selling
Securityholders for shares to be purchased by any Underwriter whose check shall
not have been received by you on the Closing Date or any later date on which
Option Stock is purchased for the account of such Underwriter. Any such payment
by you shall not relieve such Underwriter from any of its obligations hereunder.
6. Further Agreements of the Company and the Selling Securityholders.
The ESOP covenants and agrees as set forth in Section 6(i), (j), (k) and (l),
and each of the Company and the Major Selling Securityholders covenants and
agrees as follows:
(a) The Company will (i) prepare and timely file with the
Commission under Rule 424(b) a Prospectus containing information previously
omitted at the time of effectiveness of the Registration Statement in
reliance on Rule 430A and (ii) not file any amendment to the Registration
Statement or supplement to the Prospectus of which you shall not previously
have been advised and furnished with a copy or to which you shall have
reasonably objected in writing or which is not in compliance with the
Securities Act or the rules and regulations of the Commission.
(b) The Company will promptly notify each Underwriter in the event
of (i) the request by the Commission for amendment of the Registration
Statement or for supplement to the Prospectus or for any additional
information, (ii) the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement, (iii) the
institution or notice of intended institution of any action or proceeding
for that purpose, (iv) the receipt by the Company of any notification with
respect to the suspension of the qualification of the Stock for sale in any
jurisdiction, or (v) the receipt by it of notice of the initiation or
threatening of any proceeding for such purpose. The Company and the Major
Selling Securityholders will make every reasonable effort to prevent the
issuance of such a stop order and, if such an order shall at any time be
issued, to obtain the withdrawal thereof at the earliest possible moment.
(c) The Company will (i) on or before the Closing Date, deliver to
you a signed copy of the Registration Statement as originally filed and of
each amendment thereto filed prior to the time the Registration Statement
becomes effective and, promptly upon the filing thereof, a signed copy of
each post-effective amendment, if any, to the Registration Statement
(together with, in each case, all exhibits thereto unless previously
furnished to you) and will also deliver to you, for distribution to the
Underwriters, a sufficient number of additional conformed copies of each of
the foregoing (but without exhibits) so that one copy of each may be
distributed to each Underwriter, (ii) as promptly as possible deliver to
you and send to the several Underwriters, at such office or offices as you
may designate, as many copies of the Prospectus as you may reasonably
request, and (iii) thereafter from time to time during the period in which
a prospectus is required by law to be delivered by an Underwriter or
dealer, likewise send to the Underwriters as many additional copies of the
Prospectus and as many copies of any supplement to the Prospectus and of
any amended prospectus, filed by the Company with the Commission, as you
may reasonably request for the purposes contemplated by the Securities Act.
(d) If at any time during the period in which a prospectus is
required by law to be delivered by an Underwriter or dealer any event
relating to or affecting the Company, or of which the Company shall be
advised in writing by you, shall occur as a result of which it is
necessary, in the opinion of counsel for the Company or of counsel for the
Underwriters, to supplement or amend the Prospectus in order to make the
Prospectus not misleading in the light of the circumstances existing at the
time it is delivered to a purchaser of the Stock, the Company will
forthwith prepare and file with the Commission a supplement to
10
the Prospectus or an amended prospectus so that the Prospectus as so
supplemented or amended will not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances existing at the time
such Prospectus is delivered to such purchaser, not misleading. If, after
the initial public offering of the Stock by the Underwriters and during
such period, the Underwriters shall propose to vary the terms of offering
thereof by reason of changes in general market conditions or otherwise, you
will advise the Company in writing of the proposed variation, and, if in
the opinion either of counsel for the Company or of counsel for the
Underwriters such proposed variation requires that the Prospectus be
supplemented or amended, the Company will forthwith prepare and file with
the Commission a supplement to the Prospectus or an amended prospectus
setting forth such variation. The Company authorizes the Underwriters and
all dealers to whom any of the Stock may be sold by the several
Underwriters to use the Prospectus, as from time to time amended or
supplemented, in connection with the sale of the Stock in accordance with
the applicable provisions of the Securities Act and the applicable rules
and regulations thereunder for such period.
(e) Prior to the filing thereof with the Commission, the Company
will submit to you, for your information, a copy of any post-effective
amendment to the Registration Statement and any supplement to the
Prospectus or any amended prospectus proposed to be filed.
(f) The Company will cooperate, when and as requested by you, in
the qualification of the Stock for offer and sale under the securities or
blue sky laws of such jurisdictions as you may designate and, during the
period in which a prospectus is required by law to be delivered by an
Underwriter or dealer, in keeping such qualifications in good standing
under said securities or blue sky laws; provided, however, that the Company
shall not be obligated to file any general consent to service of process or
to qualify as a foreign corporation in any jurisdiction in which it is not
so qualified. The Company will, from time to time, prepare and file such
statements, reports, and other documents as are or may be required to
continue such qualifications in effect for so long a period as you may
reasonably request for distribution of the Stock.
(g) During a period of five years commencing with the date hereof,
the Company will furnish to you, and to each Underwriter who may so request
in writing, copies of all periodic and special reports furnished to
shareholders of the Company and of all information, documents and reports
filed with the Commission.
(h) Not later than the 45th day following the end of the fiscal
quarter first occurring after the first anniversary of the Effective Date,
the Company will make generally available to its security holders an
earnings statement in accordance with Section 11(a) of the Securities Act
and Rule 158 thereunder.
(i) The Company and the Major Selling Securityholders jointly and
severally, and the ESOP, only as to its pro rata share, agree to pay all
costs and expenses incident to the performance of their obligations under
this Agreement, including all costs and expenses incident to (i) the
preparation, printing and filing with the Commission and the National
Association of Securities Dealers, Inc. ("NASD") of the Registration
Statement, any Preliminary Prospectus and the Prospectus, (ii) the
furnishing to the Underwriters of copies of any Preliminary Prospectus and
of the several documents required by paragraph (c) of this Section 6 to be
so furnished, (iii) the printing of this Agreement and related documents
delivered to the Underwriters, (iv) the preparation, printing and filing of
all supplements and amendments to the Prospectus referred to in paragraph
(d) of this Section 6, (v) the furnishing to you and the Underwriters of
the reports and information referred to in paragraph (g) of this Section 6
and (vi) the printing and issuance of stock certificates, including the
transfer agent's fees. Each of the Selling Securityholders will pay any
transfer taxes incident to the transfer to the Underwriters of the shares
of Stock being sold by such Selling Securityholder.
(j) The Company and the Selling Securityholders jointly and
severally agree to reimburse you, for the account of the several
Underwriters, for blue sky fees and related disbursements (including
counsel fees and disbursements and cost of printing memoranda for the
Underwriters) paid by or for the account of the Underwriters or their
counsel in qualifying the Stock under state securities or blue sky laws and
in the review of the offering by the NASD.
11
(k) The provisions of paragraphs (i) and (j) of this Section are
intended to relieve the Underwriters from the payment of the expenses and
costs which the Company and the Selling Securityholders hereby agree to pay
and shall not affect any agreement which the Company and the Selling
Securityholders may make, or may have made, for the sharing of any such
expenses and costs.
(l) The Company and each of the Selling Securityholders, except for
the ESOP, hereby agrees that, without the prior written consent of
Xxxxxxxxx & Xxxxx LLC on behalf of the Underwriters, the Company or such
Selling Securityholder, as the case may be, will not, for a period of 90
days following the commencement of the public offering of the Stock by the
Underwriters, directly or indirectly, (i) sell, offer, contract to sell,
make any short sale, pledge, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant
to purchase or otherwise transfer or dispose of any shares of Common Stock
or any securities convertible into or exchangeable or exercisable for or
any rights to purchase or acquire Common Stock or (ii) enter into any swap
or other agreement that transfers, in whole or in part, any of the economic
consequences or ownership of Common Stock, whether any such transaction
described in clause (i) or (ii) above is to be settled by delivery of
Common Stock or such other securities, in cash or otherwise. The ESOP
hereby agrees that, without the prior written consent of Xxxxxxxxx & Xxxxx
LLC on behalf of the Underwriters, the ESOP will not, for a period of 90
days following the commencement of the public offering of the Stock by the
Underwriters, directly or indirectly, (i) sell, offer, contract to sell,
make any short sale, pledge, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant
to purchase or otherwise transfer or dispose of any shares of Common Stock
or any securities convertible into or exchangeable or exercisable for or
any rights to purchase or acquire Common Stock or (ii) enter into any swap
or other agreement that transfers, in whole or in part, any of the economic
consequences or ownership of Common Stock, whether any such transaction
described in clause (i) or (ii) above is to be settled by delivery of
Common Stock or such other securities, in cash or otherwise; provided,
however, that this agreement shall not apply to distributions from the ESOP
to employees, their heirs or beneficiaries on account of death, disability
or retirement from the Company. The foregoing sentence shall not apply to
(A) the Stock to be sold to the Underwriters pursuant to this Agreement,
(B) shares of Common Stock issued by the Company upon the exercise of
options granted under the stock option plans of the Company (the "Option
Plans"), all as described in the paragraph containing bullet points
immediately following the table under the caption "Capitalization" in the
Preliminary Prospectus, and (C) options to purchase Common Stock granted
under the Option Plans.
7. Indemnification and Contribution.
(a) Subject to the provisions of paragraph (f) of this Section 7, the
Company and the Selling Securityholders jointly and severally agree to indemnify
and hold harmless each Underwriter and each person (including each partner or
officer thereof) who controls any Underwriter within the meaning of Section 15
of the Securities Act from and against any and all losses, claims, damages or
liabilities, joint or several, to which such indemnified parties or any of them
may become subject under the Securities Act, the Exchange Act or the common law
or otherwise, and the Company and the Selling Securityholders jointly and
severally agree to reimburse each such Underwriter and controlling person for
any legal or other expenses (including, except as otherwise hereinafter
provided, reasonable fees and disbursements of counsel) incurred by the
respective indemnified parties in connection with defending against any such
losses, claims, damages or liabilities or in connection with any investigation
or inquiry of, or other proceeding which may be brought against, the respective
indemnified parties, in each case arising out of or based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (including the Prospectus as part thereof and any Rule
462(b) registration statement) or any post-effective amendment thereto
(including any Rule 462(b) registration statement), or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or (ii) any untrue
statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus or the Prospectus (as amended or as supplemented if the
Company shall have filed with the Commission any amendment thereof or supplement
thereto) or the omission or alleged omission to state therein a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that (1) the indemnity agreements of the Company and the Selling Securityholders
contained in this paragraph (a) shall not apply to any such losses, claims,
damages, liabilities or expenses if such statement or omission was made in
reliance upon and in conformity with information furnished as herein stated or
otherwise furnished in writing to the Company by or on behalf of any Underwriter
for
12
use in any Preliminary Prospectus or the Registration Statement or the
Prospectus or any such amendment thereof or supplement thereto, (2) the
indemnity agreement contained in this paragraph (a) with respect to any
Preliminary Prospectus shall not inure to the benefit of any Underwriter from
whom the person asserting any such losses, claims, damages, liabilities or
expenses purchased the Stock which is the subject thereof (or to the benefit of
any person controlling such Underwriter) if at or prior to the written
confirmation of the sale of such Stock a copy of the Prospectus (or the
Prospectus as amended or supplemented) was not sent or delivered to such person
(excluding the documents incorporated therein by reference) and the untrue
statement or omission of a material fact contained in such Preliminary
Prospectus was corrected in the Prospectus (or the Prospectus as amended or
supplemented) unless the failure is the result of noncompliance by the Company
with paragraph (c) of Section 6 hereof, and (3) each Selling Securityholder
(other than the Major Selling Securityholders) shall only be liable under this
paragraph with respect to (A) information pertaining to such Selling
Securityholder furnished by or on behalf of such Selling Securityholder
expressly for use in any Preliminary Prospectus or the Registration Statement or
the Prospectus or any such amendment thereof or supplement thereto or (B) facts
that would constitute a breach of any representation or warranty of such Selling
Securityholder set forth in Section 2(b) hereof. The indemnity agreements of the
Company and the Selling Securityholders contained in this paragraph (a) and the
representations and warranties of the Company and the Selling Securityholders
contained in Section 2 hereof shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of any indemnified
party and shall survive the delivery of and payment for the Stock.
(b) Each Underwriter severally agrees to indemnify and hold harmless the
Company, each of its officers who signs the Registration Statement on his own
behalf or pursuant to a power of attorney, each of its directors, each other
Underwriter and each person (including each partner or officer thereof) who
controls the Company or any such other Underwriter within the meaning of Section
15 of the Securities Act, and the Selling Securityholders from and against any
and all losses, claims, damages or liabilities, joint or several, to which such
indemnified parties or any of them may become subject under the Securities Act,
the Exchange Act, or the common law or otherwise and to reimburse each of them
for any legal or other expenses (including, except as otherwise hereinafter
provided, reasonable fees and disbursements of counsel) incurred by the
respective indemnified parties in connection with defending against any such
losses, claims, damages or liabilities or in connection with any investigation
or inquiry of, or other proceeding which may be brought against, the respective
indemnified parties, in each case arising out of or based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (including the Prospectus as part thereof and any Rule
462(b) registration statement) or any post-effective amendment thereto
(including any Rule 462(b) registration statement) or the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading or (ii) any untrue
statement or alleged untrue statement of a material fact contained in the
Prospectus (as amended or as supplemented if the Company shall have filed with
the Commission any amendment thereof or supplement thereto) or the omission or
alleged omission to state therein a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, if such statement or omission was made in reliance upon
and in conformity with information furnished as herein stated or otherwise
furnished in writing to the Company by or on behalf of such indemnifying
Underwriter for use in the Registration Statement or the Prospectus or any such
amendment thereof or supplement thereto. The indemnity agreement of each
Underwriter contained in this paragraph (b) shall remain operative and in full
force and effect regardless of any investigation made by or on behalf of any
indemnified party and shall survive the delivery of and payment for the Stock.
(c) Each party indemnified under the provision of paragraphs (a) and (b)
of this Section 7 agrees that, upon the service of a summons or other initial
legal process upon it in any action or suit instituted against it or upon its
receipt of written notification of the commencement of any investigation or
inquiry of, or proceeding against, it in respect of which indemnity may be
sought on account of any indemnity agreement contained in such paragraphs, it
will promptly give written notice (herein called the Notice) of such service or
notification to the party or parties from whom indemnification may be sought
hereunder. No indemnification provided for in such paragraphs shall be available
to any party who shall fail so to give the Notice if the party to whom such
Notice was not given was unaware of the action, suit, investigation, inquiry or
proceeding to which the Notice would have related and was prejudiced by the
failure to give the Notice, but the omission so to notify such indemnifying
party or parties of any such service or notification shall not relieve such
indemnifying party or parties from any liability which it or they may have to
the indemnified party for contribution or otherwise than on account of such
indemnity agreement. Any indemnifying party shall be entitled at its own expense
to participate in the defense of any action, suit or proceeding
13
against, or investigation or inquiry of, an indemnified party. Any indemnifying
party shall be entitled, if it so elects within a reasonable time after receipt
of the Notice by giving written notice (herein called the Notice of Defense) to
the indemnified party, to assume (alone or in conjunction with any other
indemnifying party or parties) the entire defense of such action, suit,
investigation, inquiry or proceeding, in which event such defense shall be
conducted, at the expense of the indemnifying party or parties, by counsel
chosen by such indemnifying party or parties and reasonably satisfactory to the
indemnified party or parties; provided, however, that (i) if the indemnified
party or parties reasonably determine that there may be a conflict between the
positions of the indemnifying party or parties and of the indemnified party or
parties in conducting the defense of such action, suit, investigation, inquiry
or proceeding or that there may be legal defenses available to such indemnified
party or parties different from or in addition to those available to the
indemnifying party or parties, then counsel for the indemnified party or parties
shall be entitled to conduct the defense to the extent reasonably determined by
such counsel to be necessary to protect the interests of the indemnified party
or parties and (ii) in any event, the indemnified party or parties shall be
entitled to have counsel chosen by such indemnified party or parties participate
in, but not conduct, the defense. If, within a reasonable time after receipt of
the Notice, an indemnifying party gives a Notice of Defense and the counsel
chosen by the indemnifying party or parties is reasonably satisfactory to the
indemnified party or parties, the indemnifying party or parties will not be
liable under paragraphs (a) through (c) of this Section 7 for any legal or other
expenses subsequently incurred by the indemnified party or parties in connection
with the defense of the action, suit, investigation, inquiry or proceeding,
except that (A) the indemnifying party or parties shall bear the legal and other
expenses incurred in connection with the conduct of the defense as referred to
in clause (i) of the proviso to the preceding sentence and (B) the indemnifying
party or parties shall bear such other expenses as it or they have authorized to
be incurred by the indemnified party or parties. If, within a reasonable time
after receipt of the Notice, no Notice of Defense has been given, the
indemnifying party or parties shall be responsible for any legal or other
expenses incurred by the indemnified party or parties in connection with the
defense of the action, suit, investigation, inquiry or proceeding.
(d) If the indemnification provided for in this Section 7 is unavailable
or insufficient to hold harmless an indemnified party under paragraph (a) or (b)
of this Section 7, then each indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of the losses, claims, damages or liabilities
referred to in paragraph (a) or (b) of this Section 7 (i) in such proportion as
is appropriate to reflect the relative benefits received by each indemnifying
party from the offering of the Stock or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of each indemnifying party in connection with
the statements or omissions that resulted in such losses, claims, damages or
liabilities, or actions in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Selling Securityholders on the one hand and the Underwriters on the other shall
be deemed to be in the same respective proportions as the total net proceeds
from the offering of the Stock received by the Company and the Selling
Securityholders and the total underwriting discount received by the
Underwriters, as set forth in the table on the cover page of the Prospectus,
bear to the aggregate public offering price of the Stock. Relative fault shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by each indemnifying party and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such untrue statement or omission.
The parties agree that it would not be just and equitable if contributions
pursuant to this paragraph (d) were to be determined by pro rata allocation
(even if the Underwriters were treated as one entity for such purpose) or by any
other method of allocation which does not take into account the equitable
considerations referred to in the first sentence of this paragraph (d). The
amount paid by an indemnified party as a result of the losses, claims, damages
or liabilities, or actions in respect thereof, referred to in the first sentence
of this paragraph (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigation,
preparing to defend or defending against any action or claim which is the
subject of this paragraph (d). Notwithstanding the provisions of this paragraph
(d), no Underwriter shall be required to contribute any amount in excess of the
underwriting discount applicable to the Stock purchased by such Underwriter. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations in this paragraph (d) to contribute are several in proportion to
their respective underwriting obligations and not joint.
14
Each party entitled to contribution agrees that upon the service of a
summons or other initial legal process upon it in any action instituted against
it in respect of which contribution may be sought, it will promptly give written
notice of such service to the party or parties from whom contribution may be
sought, but the omission so to notify such party or parties of any such service
shall not relieve the party from whom contribution may be sought from any
obligation it may have hereunder or otherwise (except as specifically provided
in paragraph (c) of this Section 7).
(e) Neither the Company nor the Selling Securityholders will, without the
prior written consent of each Underwriter, settle or compromise or consent to
the entry of any judgment in any pending or threatened claim, action, suit or
proceeding in respect of which indemnification may be sought hereunder (whether
or not such Underwriter or any person who controls such Underwriter within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act is
a party to such claim, action, suit or proceeding) unless such settlement,
compromise or consent includes an unconditional release of such Underwriter and
each such controlling person from all liability arising out of such claim,
action, suit or proceeding.
(f) The liability of each Selling Securityholder under the indemnity and
reimbursement agreements contained in the provisions of this Section 7 and
Section 11 hereof shall be limited to an amount equal to the initial public
offering price of the stock sold by such Selling Securityholder to the
Underwriters. The Company and the Selling Securityholders may agree, as among
themselves and without limiting the rights of the Underwriters under this
Agreement, as to the respective amounts of such liability for which they each
shall be responsible.
8. Termination. This Agreement may be terminated by you at any time
prior to the Closing Date by giving written notice to the Company and the
Selling Securityholders if after the date of this Agreement trading in the
Common Stock shall have been suspended, or if there shall have occurred (i) the
engagement in hostilities or an escalation of major hostilities by the United
States or the declaration of war or a national emergency by the United States on
or after the date hereof, (ii) any outbreak of hostilities or other national or
international calamity or crisis or change in economic or political conditions
if the effect of such outbreak, calamity, crisis or change in economic or
political conditions in the financial markets of the United States would, in the
Underwriters' reasonable judgment, make the offering or delivery of the Stock
impracticable, (iii) suspension of trading in securities generally or a material
adverse decline in value of securities generally on the New York Stock Exchange,
the American Stock Exchange, or The Nasdaq Stock Market, or limitations on
prices (other than limitations on hours or numbers of days of trading) for
securities on either such exchange or system, (iv) the enactment, publication,
decree or other promulgation of any federal or state statute, regulation, rule
or order of, or commencement of any proceeding or investigation by, any court,
legislative body, agency or other governmental authority which in the
Underwriters' reasonable opinion materially and adversely affects or will
materially or adversely affect the business or operations of the Company, (v)
declaration of a banking moratorium by either federal or New York State
authorities or (vi) the taking of any action by any federal, state or local
government or agency in respect of its monetary or fiscal affairs which in the
Underwriters' reasonable opinion has a material adverse effect on the securities
markets in the United States. If this Agreement shall be terminated pursuant to
this Section 8, there shall be no liability of the Company or the Selling
Securityholders to the Underwriters and no liability of the Underwriters to the
Company or the Selling Securityholders; provided, however, that in the event of
any such termination the Company and the Selling Securityholders agree to
indemnify and hold harmless the Underwriters from all costs or expenses incident
to the performance of the obligations of the Company and the Selling
Securityholders under this Agreement, including all costs and expenses referred
to in paragraphs (i) and (j) of Section 6 hereof.
9. Conditions of Underwriters' Obligations. The obligations of the
several Underwriters to purchase and pay for the Stock shall be subject to the
performance by the Company and by the Selling Securityholders of all their
respective obligations to be performed hereunder at or prior to the Closing Date
or any later date on which Option Stock is to be purchased, as the case may be,
and to the following further conditions:
(a) The Registration Statement shall have become effective; and no
stop order suspending the effectiveness thereof shall have been issued and
no proceedings therefor shall be pending or threatened by the Commission.
(b) The legality and sufficiency of the sale of the Stock hereunder
and the validity and form of the certificates representing the Stock, all
corporate proceedings and other legal matters incident to the
15
foregoing, and the form of the Registration Statement and of the Prospectus
(except as to the financial statements contained therein), shall have been
approved at or prior to the Closing Date by Xxxxx, Day, Xxxxxx & Xxxxx,
counsel for the Underwriters.
(c) You shall have received from Gray, Harris & Xxxxxxxx, P.A.,
counsel for the Company and the Selling Securityholders, and from Allen,
Dyer, Doppelt, Franjola & Xxxxxxxx, patent counsel for the Company,
opinions, addressed to the Underwriters and dated the Closing Date,
covering the matters set forth in Annex A and Annex B hereto, respectively,
and if Option Stock is purchased at any date after the Closing Date,
additional opinions from each such counsel, addressed to the Underwriters
and dated such later date, confirming that the statements expressed as of
the Closing Date in such opinions remain valid as of such later date.
(d) You shall be satisfied that (i) as of the Effective Date, the
statements made in the Registration Statement and the Prospectus were true
and correct and neither the Registration Statement nor the Prospectus
omitted to state any material fact required to be stated therein or
necessary in order to make the statements therein, respectively, not
misleading, (ii) since the Effective Date, no event has occurred which
should have been set forth in a supplement or amendment to the Prospectus
which has not been set forth in such a supplement or amendment, (iii) since
the respective dates as of which information is given in the Registration
Statement in the form in which it originally became effective and the
Prospectus contained therein, there has not been any material adverse
change or any development involving a prospective material adverse change
in or affecting the business, properties, financial condition or results of
operations of the Company and its subsidiaries, taken as a whole, whether
or not arising from transactions in the ordinary course of business, and,
since such dates, except in the ordinary course of business, neither the
Company nor any of its subsidiaries has entered into any material
transaction not referred to in the Registration Statement in the form in
which it originally became effective and the Prospectus contained therein,
(iv) neither the Company nor any of its subsidiaries has any material
contingent obligations which are not disclosed in the Registration
Statement and the Prospectus, (v) there are not any pending or known
threatened legal proceedings to which the Company or any of its
subsidiaries is a party or of which property of the Company or any of its
subsidiaries is the subject which are material and which are not disclosed
in the Registration Statement and the Prospectus, (vi) there are not any
franchises, contracts, leases or other documents which are required to be
filed as exhibits to the Registration Statement which have not been filed
as required, (vii) the representations and warranties of the Company herein
are true and correct in all material respects as of the Closing Date or any
later date on which Option Stock is to be purchased, as the case may be,
and (viii) there has not been any material change in the market for
securities in general or in political, financial or economic conditions
from those reasonably foreseeable as to render it impracticable in your
reasonable judgment to make a public offering of the Stock, or a material
adverse change in market levels for securities in general (or those of
companies in particular) or financial or economic conditions which render
it inadvisable to proceed.
(e) You shall have received on the Closing Date and on any later
date on which Option Stock is purchased a certificate, dated the Closing
Date or such later date, as the case may be, and signed by the President
and the Chief Financial Officer of the Company, stating that the respective
signers of said certificate have carefully examined the Registration
Statement in the form in which it originally became effective and the
Prospectus contained therein and any supplements or amendments thereto, and
that the statements included in clauses (i) through (vii) of paragraph (d)
of this Section 9 are true and correct.
(f) You shall have received from Ernst & Young, LLP, a letter or
letters, addressed to the Underwriters and dated the Closing Date and any
later date on which Option Stock is purchased, confirming that they are
independent public accountants with respect to the Company within the
meaning of the Securities Act and the applicable published rules and
regulations thereunder and based upon the procedures described in their
letter delivered to you concurrently with the execution of this Agreement
(herein called the Original Letter), but carried out to a date not more
than three business days prior to the Closing Date or such later date on
which Option Stock is purchased (i) confirming, to the extent true, that
the statements and conclusions set forth in the Original Letter are
accurate as of the Closing Date or such later date, as the case may be, and
(ii) setting forth any revisions and additions to the statements and
conclusions set forth in the Original Letter which are necessary to reflect
any changes in the facts described
16
in the Original Letter since the date of the Original Letter or to reflect
the availability of more recent financial statements, data or information.
The letters shall not disclose any change, or any development involving a
prospective change, in or affecting the business or properties of the
Company or any of its subsidiaries which, in your sole judgment, makes it
impractical or inadvisable to proceed with the public offering of the Stock
or the purchase of the Option Stock as contemplated by the Prospectus.
(g) You shall have received from Ernst & Young, LLP a letter
stating that their review of the Company's system of internal accounting
controls, to the extent they deemed necessary in establishing the scope of
their examination of the Company's financial statements as at September 30,
1999, did not disclose any weakness in internal controls that they
considered to be material weaknesses.
(h) You shall have been furnished evidence in usual written or
telegraphic form from the appropriate authorities of the several
jurisdictions, or other evidence satisfactory to you, of the qualification
referred to in paragraph (f) of Section 6 hereof.
(i) On or prior to the Closing Date, you shall have received from
all directors and officers of the Company agreements, in form reasonably
satisfactory to Xxxxxxxxx & Xxxxx LLC, stating that without the prior
written consent of Xxxxxxxxx & Xxxxx LLC on behalf of the Underwriters,
such person or entity will not, for a period of 90 days following the
commencement of the public offering of the Stock by the Underwriters,
directly or indirectly, (i) sell, offer, contract to sell, make any short
sale, pledge, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase or
otherwise transfer or dispose of any shares of Common Stock or any
securities convertible into or exchangeable or exercisable for or any
rights to purchase or acquire Common Stock or (ii) enter into any swap or
other agreement that transfers, in whole or in part, any of the economic
consequences or ownership of Common Stock, whether any such transaction
described in clause (i) or (ii) above is to be settled by delivery of
Common Stock or such other securities, in cash or otherwise.
All the agreements, opinions, certificates and letters mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if Xxxxx, Day, Xxxxxx & Xxxxx, counsel for the
Underwriters, shall be satisfied that they comply in form and scope.
In case any of the conditions specified in this Section 9 shall not be
fulfilled, this Agreement may be terminated by you by giving notice to the
Company and to the Selling Securityholders. Any such termination shall be
without liability of the Company or the Selling Securityholders to the
Underwriters and without liability of the Underwriters to the Company or the
Selling Securityholders; provided, however, that (i) in the event of such
termination, the Company and the Selling Securityholders agree to indemnify and
hold harmless the Underwriters from all costs or expenses incident to the
performance of the obligations of the Company and the Selling Securityholders
under this Agreement, including all costs and expenses referred to in paragraphs
(i) and (j) of Section 6 hereof, and (ii) if this Agreement is terminated by you
because of any refusal, inability or failure on the part of the Company or the
Selling Securityholders to perform any agreement herein, to fulfill any of the
conditions herein, or to comply with any provision hereof other than by reason
of a default by any of the Underwriters, the Company will reimburse the
Underwriters severally upon demand for all out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been incurred by
them in connection with the transactions contemplated hereby.
10. Conditions of the Obligation of the Company and the Selling
Securityholders. The obligation of the Company and the Selling Securityholders
to deliver the Stock shall be subject to the conditions that (a) the
Registration Statement shall have become effective and (b) no stop order
suspending the effectiveness thereof shall be in effect and no proceedings
therefor shall be pending or threatened by the Commission.
In case either of the conditions specified in this Section 10 shall not be
fulfilled, this Agreement may be terminated by the Company and the Selling
Securityholders by giving notice to you. Any such termination shall be without
liability of the Company and the Selling Securityholders to the Underwriters and
without liability of the Underwriters to the Company or the Selling
Securityholders; provided, however, that in the event of any such termination
the Company and the Selling Securityholders jointly and severally agree to
indemnify and hold harmless the Underwriters from all costs or expenses incident
to the performance of the obligations of the Company and the
17
Selling Securityholders under this Agreement, including all costs and expenses
referred to in paragraphs (i) and (j) of Section 6 hereof.
11. Reimbursement of Certain Expenses. In addition to their other
obligations under Section 7 of this Agreement (and subject, in the case of a
Selling Securityholder, to the provisions of paragraph (f) of Section 7), the
Company and the Selling Securityholders hereby jointly and severally agree to
reimburse on a quarterly basis the Underwriters for all reasonable legal and
other expenses incurred in connection with investigating or defending any claim,
action, investigation, inquiry or other proceeding arising out of or based upon
any statement or omission, or any alleged statement or omission, described in
paragraph (a) of Section 7 of this Agreement, notwithstanding the absence of a
judicial determination as to the propriety and enforceability of the obligations
under this Section 11 and the possibility that such payments might later be held
to be improper; provided, however, that (i) to the extent any such payment is
ultimately held to be improper, the persons receiving such payments shall
promptly refund them and (ii) such persons shall provide to the Company, upon
request, reasonable assurances of their ability to effect any refund, when and
if due.
12. Persons Entitled to Benefit of Agreement. This Agreement shall inure
to the benefit of the Company, the Selling Securityholders and the several
Underwriters and, with respect to the provisions of Section 7 hereof, the
several parties (in addition to the Company, the Selling Securityholders and the
several Underwriters) indemnified under the provisions of said Section 7, and
their respective personal representatives, successors and assigns. Nothing in
this Agreement is intended or shall be construed to give to any other person,
firm or corporation any legal or equitable remedy or claim under or in respect
of this Agreement or any provision herein contained. The term "successors and
assigns" as herein used shall not include any purchaser, as such purchaser, of
any of the Stock from any of the several Underwriters.
13. Notices. Except as otherwise provided herein, all communications
hereunder shall be in writing or by telegraph and, if to the Underwriters, shall
be mailed, telegraphed or delivered to Xxxxxxxxx & Xxxxx LLC, Xxx Xxxx Xxxxxx,
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000; and if to the Company, shall be mailed,
telegraphed or delivered to it at its office, Sawtek Inc., 0000 Xxxxx Xxxxxxx
000, Xxxxxx, Xxxxxxx 00000, Attention: Chief Executive Officer, and if to the
Selling Securityholders, shall be mailed, telegraphed or delivered to the
Selling Securityholders in care of Xxxxxxx X. Xxxxx, Esq., at Gray, Harris &
Xxxxxxxx, P.A., 000 Xxxx Xxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxx 00000. All
notices given by telegraph shall be promptly confirmed by letter.
14. Miscellaneous. The reimbursement, indemnification and contribution
agreements contained in this Agreement and the representations, warranties and
covenants in this Agreement shall remain in full force and effect regardless of
(a) any termination of this Agreement, (b) any investigation made by or on
behalf of any Underwriter or controlling person thereof, or by or on behalf of
the Company or the Selling Securityholders or their respective directors or
officers, and (c) delivery and payment for the Stock under this Agreement;
provided, however, that if this Agreement is terminated prior to the Closing
Date, the provisions of paragraphs (l) and (m) of Section 6 hereof shall be of
no further force or effect.
This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of California.
18
Please sign and return to the Company and to the Selling Securityholders in
care of the Company the enclosed duplicates of this letter, whereupon this
letter will become a binding agreement among the Company, the Selling
Securityholders and the several Underwriters in accordance with its terms.
Very truly yours,
SAWTEK INC.
By:
-------------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
SELLING SECURITYHOLDERS:
SAWTEK INC. EMPLOYEE STOCK OWNERSHIP AND 401(K)
PLAN
By: HSBC Bank USA, not in its individual or
corporate capacity, but solely as Trustee
By:
----------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
VIA TUSCANY INVESTMENT LIMITED PARTNERSHIP
By:
----------------------------------------
Xxxx X. Xxxxxx
General Partner
SAWMILL INVESTMENT LIMITED PARTNERSHIP
By: Sawmill (1996) Inc., its General Partner
By:
----------------------------------------
Xxxxxx X. Xxxxxx
President
VIA CAPRI INVESTMENT LIMITED PARTNERSHIP
By: Via Capri Inc., its General Partner
By:
----------------------------------------
Xxxxxx X. Xxxxxx
President
[Signatures continued on following page]
19
MOPNJ INVESTMENT LIMITED PARTNERSHIP
By: MOPNJT Inc., its General Partner
By:
----------------------------------------
Xxxx Xxx Xxxxx
President
MOP INVESTMENT LIMITED PARTNERSHIP
By: MOP Inc., its General Partner
By:
----------------------------------------
Xxxx Xxx Xxxxx
President
The foregoing Agreement is hereby confirmed
and accepted as of the date first above written.
XXXXXXXXX & XXXXX LLC
CIBC WORLD MARKETS CORP.
BANC OF AMERICA SECURITIES LLC
By: Xxxxxxxxx & Xxxxx LLC
By:
--------------------------------------------
Managing Director
Acting on behalf of the several Underwriters,
including themselves, named in Schedule I hereto.
20
SCHEDULE I
UNDERWRITERS
Number of
Shares
to be
Underwriters Purchased
------------ ---------
Xxxxxxxxx & Xxxxx LLC ...............................
CIBC World Markets Corp. ............................
Banc of America Securities LLC ......................
---------
Total........................................... 4,000,000
21
SCHEDULE II
SELLING SECURITYHOLDERS
Number of
Shares
to be
Sold
---------
Name of Selling Securityholders
-------------------------------
Major Selling Securityholders
-----------------------------
Via Capri Investment Limited Partnership 130,459
Via Tuscany Investment Limited Partnership 539,541
Sawmill Investment Limited Partnership 330,000
MOPNJ Investment Limited Partnership 700,000
MOP Investment Limited Partnership 300,000
Other Selling Securityholders
-----------------------------
Sawtek Inc. Employee Stock Ownership and 401(k) Plan..... 2,000,000
---------
Total.................................................... 4,000,000
Name of Shareholders Selling Option Stock
-----------------------------------------
[------------------]..................................... [--------]
[------------------]..................................... [--------]
Total.................................................... 600,000
22
ANNEX A
Matters to be Covered in the Opinion of Gray, Harris & Xxxxxxxx, P.A.
Counsel for the Company
and the Selling Securityholders
(i) Each of the Company and its subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, is duly qualified
as a foreign corporation and in good standing in each state of the United
States of America in which its ownership or leasing of property requires
such qualification, and has full corporate power and authority to own or
lease its properties and conduct its business as described in the
Registration Statement; all the issued and outstanding capital stock of
each of the subsidiaries of the Company has been duly authorized and
validly issued and is fully paid and nonassessable, and is owned by the
Company free and clear of all liens, encumbrances and security interests,
and to the best of our knowledge, no options, warrants or other rights to
purchase, agreements or other obligations to issue or other rights to
convert any obligations into shares of capital stock or ownership interests
in such subsidiaries are outstanding;
(ii) the authorized capital stock of the Company consists of
120,000,000 shares of Common Stock, $0.0005 par value, of which there are
outstanding [----------] shares (including the Underwritten Stock plus the
number of shares of Option Stock issued on the date hereof); all of the
outstanding shares of such capital stock (including the Underwritten Stock
and the shares of Option Stock issued, if any) have been duly and validly
issued and are fully paid and nonassessable; any Option Stock purchased
after the Closing Date, when issued and delivered to and paid for by the
Underwriters as provided in the Underwriting Agreement, will have been duly
and validly issued and be fully paid and nonassessable; and no preemptive
rights of, or rights of refusal in favor of, shareholders exist with
respect to the Stock, or the issue and sale thereof, pursuant to the
Articles of Incorporation or Bylaws of the Company and, to the knowledge of
such counsel, there are no contractual preemptive rights that have not been
waived, rights of first refusal or rights of co-sale which exist with
respect to the Stock being sold by the Selling Securityholders or the issue
and sale of the Stock;
(iii) 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 or suspending or
preventing the use of the Prospectus is in effect and no proceedings for
that purpose have been instituted or are pending or contemplated by the
Commission;
(iv) the Registration Statement and the Prospectus (except as to the
financial statements and schedules and other financial data contained
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,
the Exchange Act and with the rules and regulations of the Commission
thereunder;
(v) such counsel have no reason to believe that the Registration
Statement (except as to the financial statements and schedules and other
financial and statistical data derived therefrom, contained or incorporated
by reference therein, as to which such counsel need express no opinion or
belief) at the Effective 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 (except as to the financial statements and schedules and other
financial and statistical data derived therefrom, contained or incorporated
by reference therein, as to which such counsel need not express any opinion
or belief) as of its date or at the Closing Date (or any later date on
which Option Stock is purchased), contained or contains any untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(vi) the information required to be set forth in the Registration
Statement in answer to Items 9 and 10 (insofar as it relates to such
counsel) of Form S-3 is to the best of such counsel's knowledge, accurately
and adequately set forth therein in all material respects or no response is
required with respect to
23
such Items, and the description of the Company's 1983 Incentive Stock
Option Plan, the Sawtek Inc. Second Stock Option Plan, the Sawtek Inc.
Employee Stock Purchase Plan, the Sawtek Inc. Stock Option Plan for
Acquired Companies, the Sawtek Inc. Employee Stock Ownership and 401(k)
Trust Agreement and the options and stock awards granted and which may be
granted thereunder and the options granted otherwise than under such plans
set forth or incorporated by reference in the Prospectus accurately and
fairly presents the information required to be shown with respect to said
plans, grants and options to the extent required by the Securities Act and
the rules and regulations of the Commission thereunder;
(vii) such counsel do not know of any franchises, contracts,
leases, documents or legal proceedings, pending or threatened, which, in
their opinion, are of a character required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement, which are not described and filed as required;
(viii) the Underwriting Agreement has been duly authorized, executed
and delivered by the Company;
(ix) the Underwriting Agreement has been duly executed and
delivered by or on behalf of each of the Selling Securityholders; (B) the
Custody Agreement between the Selling Securityholders and SunTrust Bank
Central Florida, N.A., as Custodian, and the Power of Attorney referred to
in such Custody Agreement have been duly executed and delivered by such
Selling Securityholder; (C) the Custody Agreement entered into by, and the
Power of Attorney given by, (except for the Custody Agreement executed by
the ESOP) such Selling Securityholder is valid and binding on such Selling
Securityholder; and (D) each Selling Securityholder has full legal right
and authority to enter into the Underwriting Agreement and to sell,
transfer and deliver in the manner provided in the Underwriting Agreement
the shares of Stock sold by such Selling Securityholder thereunder;
(x) Such counsel do not know of any consents, authorizations,
approvals, orders, certificates and permits of and from, or declarations
and filings to be made with governmental authorities necessary to own,
lease, license and use the Company's properties and assets and to conduct
its business in the manner described in the Prospectus, which have not been
obtained or filed or where the failure to obtain or file such would not
have a material adverse effect on the Company.
(xi) to the best of such counsel's knowledge, all holders of
securities of the Company having rights to the registration of shares of
Common Stock, or other securities, because of the filing of the
Registration Statement by the Company have waived such rights or such
rights have expired by reason of lapse of time following notification of
the Company's intent to file the Registration Statement;
(xii) good and marketable title to the shares of Stock sold by the
Selling Securityholders under the Underwriting Agreement, free and clear of
all liens, encumbrances, equities, security interests and claims, has been
transferred to the Underwriters who have severally purchased such shares of
Stock under the Underwriting Agreement, assuming for the purpose of this
opinion that the Underwriters purchased the same in good faith without
notice of any adverse claims;
(xiii) no consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation of the
transactions contemplated in the Underwriting Agreement, 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 the Stock by the Underwriters; and
(xiv) the Stock sold by the Selling Securityholders is listed and
duly admitted to trading on the Nasdaq National Market.
24
ANNEX B
Matters to be Covered in the Opinion of Allen, Dyer, Doppelt, Milbrath, &
Xxxxxxxxx, P.A.,
Patent Counsel for the Company
We are familiar with the Surface Acoustic Wave ("SAW") technology used by
the Company in its business and the manner of its use thereof and have read the
Registration Statement and the Prospectus, including particularly the portions
of the Registration Statement and the Prospectus referring to patents, trade
secrets, trademarks, service marks or other proprietary information or materials
and:
(i) We have no reason to believe that the Registration Statement or
the Prospectus contain any untrue statement of a material fact with respect
to, as applicable, patent rights, copyrights, trade secrets, trademarks,
service marks or other proprietary information or materials owned or used
by the Company or any allegation on the part of any person that the Company
is infringing any patent rights, trade secrets, trademarks, service marks
or other proprietary information or materials of any such person or omits
to state any material fact relating to patent rights, copyrights, trade
secrets, trademarks, service marks or other proprietary information or
materials of any such person;
(ii) We have no reason to believe that the Registration Statement or
the Prospectus omit any material fact relating to, as applicable, patent
rights, copyrights, trade secrets, trademarks, service marks or other
proprietary information or materials owned by or used by the Company, or
the manner of the Company's use thereof, necessary to make the statements
therein not misleading; and
(iii) We are not aware that there is any allegation by another person
of which we have knowledge that is required to be stated in the
Registration Statement or the Prospectus or is necessary to make the
statements therein not misleading.
25
