1
EXHIBIT 1.1
3,500,000 SHARES OF
CROSSROADS SYSTEMS, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
, 1999
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XX XXXXX SECURITIES CORPORATION
XXXX XXXXXXXX XXXXXXX, a division of
Xxxx Xxxxxxxx Incorporated
XXXXXX XXXXXX & COMPANY, INC.
As Representatives of the several Underwriters
c/o XX Xxxxx Securities Corporation
Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
1. INTRODUCTORY. Crossroads Systems, Inc., a Delaware corporation (the
"Company"), proposes to sell, pursuant to the terms of this Agreement, to the
several underwriters named in Schedule A hereto (the "Underwriters," or, each,
an "Underwriter"), 3,500,000 shares of Common Stock, $0.001 par value (the
"Common Stock"), of the Company. The 3,500,000 shares so proposed to be sold is
hereinafter referred to as the "Firm Stock". The Company and the selling
stockholders listed in Schedule B hereto) (the "Selling Stockholders") also
propose to sell to the Underwriters, upon the terms and conditions set forth in
Section 3 hereof, up to an additional 525,000 shares of Common Stock (the
"Optional Stock"). The Firm Stock and the Optional Stock are hereinafter
collectively referred to as the "Stock". XX Xxxxx Securities Corporation ("XX
Xxxxx"), Xxxx Xxxxxxxx Xxxxxxx and Xxxxxx Xxxxxx & Company, Inc. are acting as
representatives of the several Underwriters and in such capacity are hereinafter
referred to as the "Representatives."
2. (I) REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SELLING
STOCKHOLDERS. The Company and each Selling Stockholder jointly and severally
represent and warrant to, and agree with, the several Underwriters that:
(a) A registration statement on Form S-1 (File No. 333-85505) (the
"Initial Registration Statement") in respect of the Stock has been
filed with the Securities and Exchange Commission (the "Commission");
the Initial Registration Statement and any post-effective amendment
thereto, each in the form heretofore delivered to you, and, excluding
exhibits thereto, to you for each of the other Underwriters, have been
declared effective by the Commission in such form; other than a
registration statement, if any, increasing the size of the offering (a
"Rule 462(b) Registration Statement"), filed pursuant to Rule 462(b)
under the Securities Act of 1933, as amended (the "Securities Act") and
the rules and regulations (the "Rules and Regulations") of the
Commission thereunder, which became effective upon filing, no other
document with respect to the Initial Registration Statement has
heretofore been filed or is required to be filed with the Commission;
no stop order suspending the effectiveness of the Initial Registration
Statement, any
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post-effective amendment thereto or the Rule 462(b) Registration
Statement, if any, has been issued and no proceeding for that purpose
has been initiated or threatened by the Commission (any preliminary
prospectus included in the Initial Registration Statement or filed with
the Commission pursuant to Rule 424(a) of the Rules and Regulations, is
hereinafter called a "Preliminary Prospectus"); the various parts of
the Initial Registration Statement and the Rule 462(b) Registration
Statement, if any, including all exhibits thereto and including the
information contained in the form of final prospectus filed with the
Commission pursuant to Rule 424(b) under the Securities Act and deemed
by virtue of Rule 430A under the Securities Act to be part of the
Initial Registration Statement at the time it was declared effective,
each as amended at the time such part of the Initial Registration
Statement became effective or such part of the Rule 462(b) Registration
Statement, if any, became or hereafter becomes effective, are
hereinafter collectively called the "Registration Statements"; and such
final prospectus, in the form first filed pursuant to Rule 424(b) under
the Securities Act, is hereinafter called the "Prospectus." No document
has been or will be prepared or distributed in reliance on Rule 434
under the Securities Act. No order preventing or suspending the use of
any Preliminary Prospectus has been issued by the Commission.
(b) The Registration Statement conforms (and the Rule 462(b)
Registration Statement, if any, the Prospectus and any amendments or
supplements to either of the Registration Statements or the Prospectus,
when they become effective or are filed with the Commission, as the
case may be, will conform) in all material respects to the requirements
of the Securities Act and the Rules and Regulations and do not and will
not, as of the applicable effective date (as to the Registration
Statements and any amendment thereto) and as of the applicable filing
date (as to the Prospectus and any amendment or supplement thereto)
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading; provided, however, that the
foregoing representations and warranties shall not apply to information
contained in or omitted from the Registration Statements or the
Prospectus or any such amendment or supplement thereto in reliance
upon, and in conformity with, written information furnished to the
Company through the Representatives by or on behalf of any Underwriter
specifically for inclusion therein.
(c) The Company and each of its subsidiaries (as defined in Section 15)
have been duly incorporated and are validly existing as corporations in
good standing under the laws of their respective jurisdictions of
incorporation, are duly qualified to do business and are in good
standing as foreign corporations in each jurisdiction in which their
respective ownership or lease of property or the conduct of their
respective businesses requires such qualification, and have all power
and authority necessary to own or hold their respective properties and
to conduct the businesses in which they are engaged, except where the
failure to so qualify or have such power or authority would not have,
singularly or in the aggregate, a material adverse effect on the
condition (financial or otherwise), results of operations, business or
prospects of the Company and its subsidiaries taken as a whole (a
"Material Adverse Effect"). The Company owns or controls, directly or
indirectly, only the following corporations, associations or other
entities: Crossroads Systems, Inc. (Texas), a Texas corporation.
(d) This Agreement has been duly authorized executed and delivered by
the Company.
(e) The Stock to be issued and sold by the Company to the Underwriters
hereunder has been duly and validly authorized and, when issued and
delivered against payment
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therefor as provided herein, will be duly and validly issued, fully
paid and nonassessable and free of any preemptive or similar rights and
will conform to the description thereof contained in the Prospectus.
(f) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully
paid and non-assessable and conform to the description thereof
contained in the Prospectus.
(g) All the outstanding shares of capital stock of each subsidiary of
the Company have been duly authorized and validly issued, are fully
paid and nonassessable and, except to the extent set forth in the
Prospectus, are owned by the Company directly or indirectly through one
or more wholly-owned subsidiaries, free and clear of any claim, lien,
encumbrance, security interest, restriction upon voting or transfer or
any other claim of any third party.
(h) The execution, delivery and performance of this Agreement by the
Company and the consummation of the transactions contemplated hereby
will not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its subsidiaries is a party
or by which the Company or any of its subsidiaries is bound or to which
any of the property or assets of the Company or any of its subsidiaries
is subject, nor will such actions result in any violation of the
provisions of the charter or by-laws of the Company or any of its
subsidiaries or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the
Company or any of its subsidiaries or any of their properties or
assets.
(i) Except for the registration of the Stock under the Securities Act
and such consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and applicable
state securities laws in connection with the purchase and distribution
of the Stock by the Underwriters, no consent, approval, authorization
or order of, or filing or registration with, any such court or
governmental agency or body is required for the execution, delivery and
performance of this Agreement by the Company and the consummation of
the transactions contemplated hereby.
(j) To the Company's knowledge, PricewaterhouseCoopers LLP, who have
expressed their opinions on the audited financial statements and
related schedules included in the Registration Statements and the
Prospectus, are independent public accountants as required by the
Securities Act and the Rules and Regulations.
(k) The financial statements, together with the related notes and
schedules, included in the Prospectus and in each Registration
Statement fairly present the financial position and the results of
operations and changes in financial position of the Company and its
consolidated subsidiaries at the respective dates or for the respective
periods therein specified. Such statements and related notes and
schedules have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis except as may be
set forth in the Prospectus.
(l) Neither the Company nor any of its subsidiaries has sustained,
since the date of the latest audited financial statements included in
the Prospectus, any material loss or interference with its business
from fire, explosion, flood or other calamity, whether or not covered
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by insurance, or from any labor dispute or court or governmental
action, order or decree, otherwise than as set forth or contemplated in
the Prospectus; and, since such date, there has not been any change in
the capital stock or long-term debt of the Company or any of its
subsidiaries or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the
business, general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries taken as a whole, otherwise than as set forth or
contemplated in the Prospectus.
(m) There is no legal or governmental proceeding pending to which the
Company or any of its subsidiaries is a party or of which any property
or assets of the Company or any of its subsidiaries is the subject
which, singularly or in the aggregate, if determined adversely to the
Company or any of its subsidiaries, might have a Material Adverse
Effect or would prevent or adversely affect the ability of the Company
to perform its obligations under this Agreement; and to the best of the
Company's knowledge, no such proceedings are threatened or contemplated
by governmental authorities or threatened by others.
(n) Neither the Company nor any of its subsidiaries is in violation of
its charter or by-laws, or, except for any violations or defaults
which, singularly or in the aggregate, would not have a Material
Adverse Effect, (i) is in default in any respect, and no event has
occurred which, with notice or lapse of time or both, would constitute
such a default, in the due performance or observance of any term,
covenant or condition contained in any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which it is a
party or by which it is bound or to which any of its property or assets
is subject or (ii) is in violation in any respect of any law,
ordinance, governmental rule, regulation or court decree to which it or
its property or assets may be subject.
(o) The Company and each of its subsidiaries possess all licenses,
certificates, authorizations and permits issued by, and have made all
declarations and filings with, the appropriate state, federal or
foreign regulatory agencies or bodies which are necessary for the
ownership of their respective properties or the conduct of their
respective businesses as described in the Prospectus except where any
failures to possess or make the same, singularly or in the aggregate,
would not have a Material Adverse Effect, and the Company has not
received notification of any revocation or modification of any such
license, authorization or permit and has no reason to believe that any
such license, certificate, authorization or permit will not be renewed.
(p) Neither the Company nor any of its subsidiaries is or, after giving
effect to the offering of the Stock and the application of the proceeds
thereof as described in the Prospectus, will become an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended and the rules and regulations of the Commission thereunder.
(q) Neither the Company nor any of its officers, directors or
affiliates has taken or will take, directly or indirectly, any action
designed or intended to stabilize or manipulate the price of any
security of the Company, or which caused or resulted in, or which might
in the future reasonably be expected to cause or result in,
stabilization or manipulation of the price of any security of the
Company.
(r) The Company and its subsidiaries own or possess the right to use
all patents, trademarks, trademark registrations, service marks,
service xxxx registrations, trade names, copyrights, licenses,
inventions, trade secrets and rights currently employed by each of
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them to conduct their respective businesses as described in the
Prospectus, and the Company is not aware of any claim to the contrary
or any challenge by any other person to the rights of the Company and
its subsidiaries with respect to the foregoing. The Company's business
as now conducted and as proposed to be conducted does not and will not
infringe or conflict with any patents, trademarks, service marks, trade
names, copyrights, trade secrets, licenses or other intellectual
property or franchise right of any person. No claim has been made
against the Company alleging the infringement by the Company of any
patent, trademark, service xxxx, trade name, copyright, trade secret,
license in or other intellectual property right or franchise right of
any person.
(s) The Company and each of its subsidiaries have good and marketable
title in fee simple to, or have valid rights to lease or otherwise use,
all items of real or personal property which are material to the
business of the Company and its subsidiaries taken as a whole, in each
case free and clear of all liens, encumbrances, claims and defects
except as disclosed in the Prospectus or otherwise may result in a
Material Adverse Effect.
(t) No labor disturbance by the employees of the Company or any of its
subsidiaries exists or, to the best of the Company's knowledge, is
imminent which might be expected to have a Material Adverse Effect. The
Company is not aware that any key employee or significant group of
employees of the Company or any subsidiary plans to terminate
employment with the Company or any such subsidiary.
(u) No "prohibited transaction" (as defined in Section 406 of the
Employee Retirement Income Security Act of 1974, as amended, including
the regulations and published interpretations thereunder ("ERISA"), or
Section 4975 of the Internal Revenue Code of 1986, as amended from time
to time (the "Code")) or "accumulated funding deficiency" (as defined
in Section 302 of ERISA) or any of the events set forth in Section
4043(b) of ERISA (other than events with respect to which the 30-day
notice requirement under Section 4043 of ERISA has been waived) has
occurred with respect to any employee benefit plan which could have a
Material Adverse Effect; each employee benefit plan is in compliance in
all material respects with applicable law, including ERISA and the
Code; the Company has not incurred and does not expect to incur
liability under Title IV of ERISA with respect to the termination of,
or withdrawal from, any "pension plan"; and each "pension plan" (as
defined in ERISA) 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 could cause the loss of such
qualification.
(v) There has been no storage, generation, transportation, handling,
treatment, disposal, discharge, emission, or other release of any kind
of toxic or other wastes or other hazardous substances by, due to, or
caused by the Company or any of its subsidiaries (or, to the best of
the Company's knowledge, any other entity for whose acts or omissions
the Company or any of its subsidiaries is or may be liable) upon any of
the property now or previously owned or leased by the Company or any of
its subsidiaries, in violation of any statute or any ordinance, rule,
regulation, order, judgment, decree or permit or which would, under any
statute or any ordinance, rule (including rule of common law),
regulation, order, judgment, decree or permit, give rise to any
liability, except for any violation or liability which would not have,
singularly or in the aggregate with all such violations and
liabilities, a Material Adverse Effect; there has been no disposal,
discharge, emission or other release of any kind onto such property or
into the environment surrounding such property of any toxic or other
wastes or other hazardous substances with respect
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to which the Company or any of its subsidiaries have knowledge, except
for any such disposal, discharge, emission, or other release of any
kind which would not have, singularly or in the aggregate with all such
discharges and other releases, a Material Adverse Effect.
(w) The Company and its subsidiaries each (i) have filed with all
necessary federal, state and foreign income and franchise tax returns,
(ii) have paid all federal, state, local and foreign taxes due and
payable for which it is liable, and (iii) do not have any tax
deficiency or claims outstanding or assessed or, to the best of the
Company's knowledge, proposed against it which could reasonably be
expected to have a Material Adverse Effect. Neither the Company nor any
of its subsidiaries is currently subject to any pending audit by any
taxing authority which could reasonably be expected to have a Material
Adverse Effect.
(x) The Company and each of its subsidiaries carry, or are covered by,
insurance in such amounts and covering such risks as is adequate for
the conduct of their respective businesses and the value of their
respective properties and as is customary for companies engaged in
similar businesses in similar industries.
(y) The Company and each of its subsidiaries 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 and appropriate 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.
(z) The minute books of the Company and each of its subsidiaries have
been made available to the Underwriters and counsel for the
Underwriters, and such books (i) contain a complete summary of all
meetings and actions of the directors and stockholders of the Company
and each of its subsidiaries since the time of its respective
incorporation through the date of the latest meeting and action, and
(ii) accurately in all material respects reflect all transactions
referred to in such minutes.
(aa) There is no franchise, lease, contract, agreement or document
required by the Securities Act or by the Rules and Regulations to be
described in the Prospectus or to be filed as an exhibit to the
Registration Statements which is not described or filed therein as
required; and all descriptions of any such franchises, leases,
contracts, agreements or documents contained in the Registration
Statements are accurate and complete descriptions of such documents in
all material respects.
(bb) No relationship, direct or indirect, exists between or among the
Company on the one hand, and the directors, officers, stockholders,
customers or suppliers of the Company on the other hand, which is
required to be described in the Prospectus and which is not so
described.
(cc) No person or entity has the right to require registration of
shares of Common Stock or other securities of the Company because of
the filing or effectiveness of the Registration Statements or the
transactions contemplated by this agreement, except for persons and
entities who have expressly waived such right or who have been given
proper notice and have
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failed to exercise such right within the time or times required under
the terms and conditions of such right.
(dd) Neither the Company nor any of its subsidiaries own any "margin
securities" as that term is defined in Regulations G and U of the Board
of Governors of the Federal Reserve System (the "Federal Reserve
Board"), and none of the proceeds of the sale of the Stock will be
used, directly or indirectly, for the purpose of purchasing or carrying
any margin security, for the purpose of reducing or retiring any
indebtedness which was originally incurred to purchase or carry any
margin security or for any other purpose which might cause any of the
Securities to be considered a "purpose credit" within the meanings of
Regulation G, T, U or X of the Federal Reserve Board.
(ee) Neither the Company nor any of its subsidiaries is a party to any
contract, agreement or understanding with any person that would give
rise to a valid claim against the Company or the Underwriters for a
brokerage commission, finder's fee or like payment in connection with
the offering and sale of the Stock.
(ff) The Company has reviewed its operations and that of its
subsidiaries and any third parties with which the Company or any of its
subsidiaries has a material relationship to evaluate the extent to
which the business or operations of the Company or any of its
subsidiaries will be affected by the Year 2000 Problem. As a result of
such review, the Company has no reason to believe, and does not
believe, that the Year 2000 Problem will have a Material Adverse
Effect. The "Year 2000 Problem" as used herein means any significant
risk that computer hardware or software used in the receipt,
transmission, processing, manipulation, storage, retrieval,
retransmission or other utilization of data or in the operation of
mechanical or electrical systems of any kind will not, in the case of
dates or time periods occurring after December 31, 1999, function at
least as effectively as in the case of dates or time periods occurring
prior to January 1, 2000.
(gg) The Stock has been approved for listing subject to notice of
issuance on the NASDAQ Stock Market's National Market.
(II) SEPARATE REPRESENTATIONS AND WARRANTIES AND AGREEMENTS OF THE
SELLING STOCKHOLDERS. Each Selling Stockholder, severally and not
jointly, represents and warrants to, and agrees with, the several
Underwriters that:
(a) Such Selling Stockholder has, and immediately prior to the Option
Closing Date (as defined in Section 4 hereof) the Selling Stockholder
will have good and valid title to the shares of Optional Stock to be
sold by the Selling Stockholder hereunder on such date, free and clear
of all liens, encumbrances, equities or claims; and upon delivery of
such shares and payment therefor pursuant hereto, good and valid title
to such shares, free and clear of all liens, encumbrances, equities or
claims, will pass to the several Underwriters.
(b) Such Selling Stockholder has duly and irrevocably executed and
delivered a power of attorney, in substantially the form heretofore
delivered by the Representatives (the "Power of Attorney"), appointing,
Xxxxx X. Xxxxx and [Xxxxxx X. Xxxxx] and each of them, as
attorney-in-fact (the "Attorneys-in-fact") with authority to execute
and deliver this Agreement on behalf of such Selling Stockholder, to
authorize the delivery of the shares of Optional Stock to be sold by
such Selling Stockholder hereunder and otherwise to act on behalf of
such Selling Stockholder in connection with the transactions
contemplated by this Agreement.
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(c) Such Selling Stockholder has duly and irrevocably executed and
delivered a custody agreement, in substantially the form heretofore
delivered by the Representatives (the "Custody Agreement"), with
[insert name of custodian] as custodian (the "Custodian"), pursuant to
which certificates in negotiable form for the shares of Optional Stock
to be sold by such Selling Stockholder hereunder have been placed in
custody for delivery under this Agreement.
(d) Such Selling Stockholder has full right, power and authority to
enter into this Agreement, the Power of Attorney and the Custody
Agreement; the execution, delivery and performance of this Agreement,
the Power of Attorney and the Custody Agreement by such Selling
Stockholder and the consummation by such Selling Stockholder of the
transactions contemplated hereby and thereby will not conflict with or
result in a breach or violation of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which such Selling
Stockholder is a party or by which the Selling Stockholder is bound or
to which any of the property or assets of the Selling Stockholder is
subject, nor will such actions result in any violation of the
provisions of the partnership agreement (if such Selling Stockholder is
a partnership), charter or by-laws of the Selling Stockholder (if such
Selling Stockholder is a corporation) or any statute or any order, rule
or regulation of any court or governmental agency or body having
jurisdiction over the Selling Stockholder or the property or assets of
the Selling Stockholder; and, except for the registration of the Stock
under the Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the Exchange
Act and applicable state securities laws in connection with the
purchase and distribution of the Stock by the Underwriters, no consent,
approval, authorization or order of, or filing or registration with,
any such court or governmental agency or body is required for the
execution, delivery and performance of this Agreement, the Power of
Attorney or the Custody Agreement by such Selling Stockholder and the
consummation by the Selling Stockholder of the transactions
contemplated hereby and thereby.
(e) The Registration Statements do not, and the Prospectus and any
further amendments or supplements to the Registration Statements or the
Prospectus will not, as of the applicable effective date (as to the
Registration Statements and any amendment thereto) and as of the
applicable filing date (as to the Prospectus and any amendment or
supplement thereto) contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading. The preceding
sentence applies only to the extent that any information contained in
or omitted from the Registration Statements or Prospectus was in
reliance upon and in conformity with written information furnished to
the Company by such Selling Stockholder specifically for inclusion
therein.
3. PURCHASE SALE AND DELIVERY OF OFFERED SECURITIES. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company agrees, to sell to each
Underwriter, and each Underwriter agrees, severally and not jointly, to purchase
from the Company that number of shares of Firm Stock set forth opposite the name
of such Underwriter in Schedule A hereto.
The purchase price per share to be paid by the Underwriters to
the Company for the Stock will be $ per share (the "Purchase Price").
The Company will deliver the Firm Stock to the Representatives
for the respective accounts of the several Underwriters (in the form of
definitive certificates, issued in such names and in such denominations as the
Representatives may direct by notice in writing to the Company given at or
prior to
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12:00 Noon, New York time, on the second full business day preceding the First
Closing Date (as defined below) against payment of the aggregate Purchase Price
therefor by wire transfer to an account at a bank acceptable to XX Xxxxx,
payable to the order of the Company, all at the offices of Xxxxxxx Phleger &
Xxxxxxxx LLP at 000 Xxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxx 00000. Time
shall be of the essence, and delivery at the time and place specified pursuant
to this Agreement is a further condition of the obligations of each Underwriter
hereunder. The time and date of the delivery and closing shall be at 10:00
A.M., New York time, on ___________ 1999, in accordance with Rule 15c6-1 of the
Exchange Act. The time and date of such payment and delivery are herein referred
to as the "First Closing Date". The First Closing Date and the location of
delivery of, and the form of payment for, the Firm Stock may be varied by
agreement between the Company and XX Xxxxx.
The Company shall make the certificates for the Stock
available to the Representatives for examination on behalf of the Underwriters
in New York, New York at least twenty-four hours prior to the First Closing
Date.
For the purpose of covering any over-allotments in connection
with the distribution and sale of the Firm Stock as contemplated by the
Prospectus, the Underwriters may purchase all or less than all of the Optional
Stock. The price per share to be paid for the Optional Stock shall be the
Purchase Price. The Company and Selling Stockholders agree, severally and not
jointly, to sell to the Underwriters the number of shares of Optional Stock
specified in the written notice by XX Xxxxx described below (but not to exceed
the number of Optional Shares set forth opposite such Selling Stockholder's name
on Schedule B) and the Underwriters agree, severally and not jointly, to
purchase such shares of Optional Stock for the account of each Underwriter in
the same proportion as the number of shares of Firm Stock set forth opposite
such Underwriter's name bears to the total number of shares of Firm Stock
(subject to adjustment by XX Xxxxx to eliminate fractions). The option granted
hereby may be exercised as to all or any part of the Optional Stock at any time,
and from time to time, not more than thirty (30) days subsequent to the date of
this Agreement. No Optional Stock shall be sold and delivered unless the Firm
Stock previously has been, or simultaneously is, sold and delivered. The right
to purchase the Optional Stock or any portion thereof may be surrendered and
terminated at any time upon notice by XX Xxxxx to the Company and Selling
Stockholders.
The option granted hereby may be exercised by written notice
being given to the Company and the Selling Stockholders by XX Xxxxx setting
forth the number of shares of the Optional Stock to be purchased by the
Underwriters and the date and time for delivery of and payment for the Optional
Stock. Each date and time for delivery of and payment for the Optional Stock
(which may be the First Closing Date, but not earlier) is herein called the
"Option Closing Date" and shall in no event be earlier than two (2) business
days nor later than five (5) business days after written notice is given. (The
Option Closing Date and the First Closing Date are herein called the "Closing
Dates".)
The Company and the Selling Stockholders will deliver the
Optional Stock to the Underwriters (in the form of definitive certificates,
issued in such names and in such denominations as the Representatives may direct
by notice in writing to the Company and the Selling Stockholders given at or
prior to 12:00 Noon, New York time, on the second full business day preceding
the Option Closing Date against payment of the aggregate Purchase Price therefor
in federal (same day) funds by certified or official bank check or checks or
wire transfer to an account at a bank acceptable to XX Xxxxx payable to the
order of the Company all at the offices of Xxxxxxx Phleger & Xxxxxxxx LLP. Time
shall be of the essence, and delivery at the time and place specified pursuant
to this Agreement is a further condition of the obligations of each Underwriter
hereunder. The Company and the Selling Stockholders shall make the certificates
for the Optional Stock available to the Representatives for examination on
behalf of the Underwriters in Xxx
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Xxxx, Xxx Xxxx not later than 10:00 A.M., New York Time, on the business day
preceding the Option Closing Date. The Option Closing Date and the location of
delivery of, and the form of payment for, the Optional Stock may be varied by
agreement among the Company, the Selling Stockholders and XX Xxxxx.
The several Underwriters propose to offer the Stock for sale
upon the terms and conditions set forth in the Prospectus.
4. (1) FURTHER AGREEMENTS OF THE COMPANY. The Company agrees with the several
Underwriters that:
(a) The Company will prepare the Rule 462(b) Registration Statement, if
necessary, in a form approved by the Representatives and file such Rule
462(b) Registration Statement with the Commission on the date hereof,
prepare the Prospectus in a form approved by the Representatives and
file such Prospectus pursuant to Rule 424(b) under the Securities Act
not later than the second business day following the execution and
delivery of this Agreement; make no further amendment or any
supplement to the Registration Statements or to the Prospectus to which
the Representatives shall reasonably object by notice to the Company
after a reasonable period to review; advise the Representatives,
promptly after it receives notice thereof, of the time when any
amendment to either Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended Prospectus
has been filed and to furnish the Representatives with copies thereof,
advise the Representatives, promptly after it receives notice thereof,
of the issuance by the Commission of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or the
Prospectus, of the suspension of the qualification of the Stock for
offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request
by the Commission for the amending or supplementing of the Registration
Statements or the Prospectus or for additional information; and, in the
event of the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or the Prospectus or
suspending any such qualification, use promptly its best efforts to
obtain its withdrawal.
(b) If at any time prior to the expiration of nine months after the
effective date of the Initial Registration Statement when a prospectus
relating to the Stock is required to be delivered any event occurs as a
result of which the Prospectus as then amended or supplemented would
include any untrue statement of a material fact, or omit to state any
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus to comply with the
Securities Act, the Company will promptly notify the Representatives
thereof and upon their request will prepare an amended or supplemented
Prospectus which will correct such statement or omission or effect such
compliance. The Company will furnish without charge to each Underwriter
and to any dealer in securities as many copies as the Representatives
may from time to time reasonably request of such amended or
supplemented Prospectus; and in case any Underwriter is required to
deliver a prospectus relating to the Stock nine months or more after
the effective date of the Initial Registration Statement, the Company
upon the request of the Representatives and at the expense of such
Underwriter will prepare promptly an amended or supplemented Prospectus
as may be necessary to permit compliance with the requirements of
Section 10(a)(3) of the Securities Act.
(c) The Company will to furnish promptly to each of the Representatives
and to counsel for the Underwriters a signed copy of each of the
Registration Statements as originally
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filed with the Commission, and each amendment thereto filed with the
Commission, including all consents and exhibits filed therewith.
(d) The Company will deliver promptly to the Representatives in New
York City such number of the following documents as the Representatives
shall reasonably request: (i) conformed copies of the Registration
Statements as originally filed with the Commission and each amendment
thereto (in each case excluding exhibits), (ii) each Preliminary
Prospectus, and (iii) the Prospectus (not later than 10:00 A.M. New
York time, of the business day following the execution and delivery of
this Agreement) and any amended or supplemented Prospectus (not later
than 10:00 A.M., New York City time, on the business day following the
date of such amendment or supplement).
(e) The Company will make generally available to its stockholders as
soon as practicable, but in any event not later than eighteen months
after the effective date of the Registration Statement (as defined in
Rule 158(c) under the Securities Act), an earnings statement of the
Company and its subsidiaries (which need not be audited) complying with
Section 11(a) of the Securities Act and the Rules and Regulations
(including, at the option of the Company, Rule 158).
(f) The Company will promptly take from time to time such actions as
the Representatives may reasonably request to qualify the Stock for
offering and sale under the securities or Blue Sky laws of such
jurisdictions as the Representatives may designate and to continue such
qualifications in effect for so long as required for the distribution
of the Stock; provided that the Company and its subsidiaries shall not
be obligated to qualify as foreign corporations in any jurisdiction in
which they are not so qualified or to file a general consent to service
of process in any jurisdiction;
(g) During the period of five years from the date hereof, the Company
will deliver to the Representatives and, upon request, to each of the
other Underwriters, (i) as soon as they are available, copies of all
reports or other communications furnished to stockholders and (ii) as
soon as they are available, copies of any reports and financial
statements furnished or filed with the Commission pursuant to the
Exchange Act or any national securities exchange or automatic quotation
system on which the Stock is listed or quoted.
(h) The Company will not directly or indirectly offer, sell, assign,
transfer, pledge, contract to sell, or otherwise dispose of any shares
of Common Stock or securities convertible into or exercisable or
exchangeable for Common Stock for a period of 180 days from the date of
the Prospectus without the prior written consent of XX Xxxxx other than
the Company's sale of the Stock hereunder and the issuance of shares
pursuant to employee benefit plans, stock option plans or other
employee compensation plans existing on the date hereof or pursuant to
currently outstanding options, warrants or rights. The Company will
cause each officer, director and stockholder listed in Schedule C to
furnish to the Representatives, prior to the First Closing Date, a
letter, substantially in the form of Exhibit I hereto, pursuant to
which each such person shall agree not to directly or indirectly offer,
sell, assign, transfer, pledge, contract to sell, or otherwise dispose
of any shares of Common Stock or securities convertible into or
exercisable or exchangeable for Common Stock for a period of 180 days
from the date of the Prospectus, without the prior written consent of
XX Xxxxx.
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(i) The Company will supply the Representatives with copies of all
correspondence to and from, and all documents issued to and by, the
Commission in connection with the registration of the Stock under the
Securities Act.
(j) Prior to each of the Closing Dates the Company will furnish to the
Representatives, as soon as they have been prepared, copies of any
unaudited interim consolidated financial statements of the Company for
any periods subsequent to the periods covered by the financial
statements appearing in the Registration Statement and the Prospectus.
(k) Prior to each of the Closing Dates, the Company will not issue any
press release or other communication directly or indirectly or hold any
press conference with respect to the Company, its condition, financial
or otherwise, or earnings, business affairs or business prospects
(except for routine oral marketing communications in the ordinary
course of business and consistent with the past practices of the
Company and of which the Representatives are notified), without the
prior written consent of the Representatives, unless in the judgment of
the Company and its counsel, and after notification to the
Representatives, such press release or communication is required by law
or official mandate of the Nasdaq Stock Market.
(l) In connection with the offering of the Stock, until XX Xxxxx shall
have notified the Company of the completion of the resale of the Stock,
the Company will not, and will cause its affiliated purchasers (as
defined in Regulation M under the Exchange Act) not to, either alone or
with one or more other persons, bid for or purchase, for any account in
which it or any of its affiliated purchasers has a beneficial interest,
any Stock, or attempt to induce any person to purchase any Stock; and
not to, and to cause its affiliated purchasers not to, make bids or
purchase for the purpose of creating actual, or apparent, active
trading in or of raising the price of the Stock.
(m) The Company will not take any action prior to the Option Closing
Date which would require the Prospectus to be amended or supplemented
pursuant to Section 4(I)(b);
(n) The Company will apply the net proceeds from the sale of the Stock
as set forth in the Prospectus under the heading "Use of Proceeds".
(II) FURTHER AGREEMENTS OF THE SELLING STOCKHOLDERS. Each Selling
Stockholder, severally and not jointly, agrees with the several
Underwriters that:
(a) They will not to directly or indirectly offer, sell, assign,
transfer, pledge, contract to sell, or otherwise dispose of any shares
of Common Stock or securities convertible into or exercisable or
exchangeable for Common Stock other than (a) the sale of the Optional
Stock hereunder (b) as a bona fide gift or gifts provided that the
donee or donees thereof execute and agree to be bound by the terms of
the Lock-Up Agreement, or (c) as distributed to limited partners or
shareholders of the Selling Stockholder, provided that the distributes
thereof execute and agree to be bound by the terms of the Lock-Up
Agreement, for a period of 180 days from the date of the Prospectus,
without the prior written consent of XX Xxxxx.
(b) The shares of Stock represented by the certificates held in custody
under the Custody Agreement are for the benefit of and coupled with and
subject to the interests of the Underwriters and the other Selling
Stockholders, and that the arrangement for such custody and the
appointment of the Attorney-in-fact are irrevocable; that the
obligations of such Selling Stockholder hereunder shall not be
terminated by operation of law, whether by the death or
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incapacity, liquidation or distribution of such Selling Stockholder, or
any other event, that if such Selling Stockholder should die or become
incapacitated or is liquidated or dissolved or any other event occurs,
before the delivery of the Stock hereunder, certificates for the Stock
to be sold by such Selling Stockholder shall be delivered on behalf of
such Selling Stockholder in accordance with the terms and conditions of
this Agreement and the Custody Agreement, and action taken by the
Attorneys-in-fact or any of them under the Power of Attorney shall be
as valid as if such death, incapacity, liquidation or dissolution or
other event had not occurred, whether or not the Custodian, the
Attorneys-in-fact or any of them shall have notice of such death,
incapacity, liquidation or dissolution or other event.
(c) They will deliver to XX Xxxxx on or prior to the First Closing Date
a properly completed and executed United States Treasury Department
Form W-8 (if the Selling Stockholder is a non-United States person) or
Form W-9 (if the Selling Stockholder is a United States person) or such
other applicable form or statement specified by Treasury Department
regulations in lieu thereof.
5. PAYMENT OF EXPENSE. The Company agrees with the Underwriter to pay (a) the
costs incident to the authorization, issuance, sale, preparation and delivery of
the Stock and any taxes payable in that connection; (b) the costs incident to
the Registration of the Stock under the Securities Act; (c) the costs incident
to the preparation, printing and distribution of the Registration Statement,
Preliminary Prospectus, Prospectus any amendments and exhibits thereto the costs
of printing, reproducing and distributing the Power of Attorney, the Custody
Agreement, the "Agreement Among Underwriters" between the Representatives and
the Underwriters, the Master Selected Dealers' Agreement, the Underwriters'
Questionnaire and this Agreement by mail, telex or other means of
communications; (d) the fees and expenses (including related fees and expenses
of counsel for the Underwriters) incurred in connection with filings made with
the National Association of Securities Dealers; (e) any applicable listing or
other fees; (f) the fees and expenses of qualifying the Stock under the
securities laws of the several jurisdictions as provided in Section 4[I](f) and
of preparing, printing and distributing Blue Sky Memoranda and Legal Investment
Surveys (including related fees and expenses of counsel to the Underwriters);
(g) all fees and expenses of the registrar and transfer agent of the Stock; and
(h) all other costs and expenses incident to the performance of the obligations
of the Company [and of the Selling Stockholder[s]] under this Agreement
(including, without limitation, the fees and expenses of the Company's counsel
and the Company's independent accountants); provided that, except as otherwise
provided in this Section 5 and in Section 10, the Underwriters shall pay their
own costs and expenses, including the fees and expenses of their counsel, any
transfer taxes on the Stock which they may sell and the expenses of advertising
any offering of the Stock made by the Underwriters.
Each Selling Stockholder will pay all fees and expenses incident to the
performance of such Selling Stockholder's obligations under this Agreement which
are not otherwise specifically provided for herein, including but not limited to
any fees and expenses of counsel for such Selling Stockholder, such Selling
Stockholder's pro rata share of fees and expenses of the Attorneys-in-fact and
the Custodian and all expenses and taxes incident to the sale and delivery of
the Stock to be sold by such Selling Stockholder to the Underwriters hereunder.
6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The respective obligations of the
several Underwriters hereunder are subject to the accuracy, when made and on
each of the Closing Dates (except as indicated below), of the representations
and warranties of the Company and the Selling Stockholders contained herein, to
the accuracy of the statements of the Company and the Selling Stockholders made
in any certificates pursuant to the provisions hereof, to the performance by the
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Company and the Selling Stockholders of their obligations hereunder, and to each
of the following additional terms and conditions:
(a) No stop order suspending the effectiveness of the Registration
Statements shall have been issued and no proceedings for that purpose
shall have been initiated or threatened by the Commission, and any
request for additional information on the part of the Commission (to be
included in the Registration Statements or the Prospectus or otherwise)
shall have been complied with to the reasonable satisfaction of the
Representatives. The Rule 462(b) Registration Statement, if any, and
the Prospectus shall have been timely filed with the Commission in
accordance with Section 4(l)(a).
(b) None of the Underwriters shall have discovered and disclosed to the
Company in writing on or prior to the Closing Date that the
Registration Statement or the Prospectus or any amendment or supplement
thereto contains an untrue statement of a fact which, in the opinion of
counsel for the Underwriters, is material or omits to state any fact
which, in the opinion of such counsel, is material and is required to
be stated therein or is necessary to make the statements therein not
misleading.
(c) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement the Stock, the
Registration Statement and the Prospectus, and with respect to an
Option Closing Date, the Custody Agreement and Powers of Attorney and
all other legal matters relating to this Agreement and the transactions
contemplated hereby shall be reasonably satisfactory in all material
respects to counsel for the Underwriters, and the Company and the
Selling Stockholders shall have furnished to such counsel all documents
and information that they may reasonably request to enable them to pass
upon such matters.
(d) Xxxxxxx, Xxxxxxx & Xxxxxxxx LLP shall have furnished to the
Representatives such counsel's written opinion, as counsel to the
Company, addressed to the Underwriters and dated the Closing Date, in
form and substance reasonably satisfactory to the Representatives, to
the effect that:
(i) The Company and each of its subsidiaries have been duly
incorporated and are validly existing as corporations in good
standing under the laws of their respective jurisdictions of
incorporation, are duly qualified to do business and are in
good standing as foreign corporations in each jurisdiction in
which their respective ownership or lease of property or the
conduct of their respective businesses requires such
qualification, and have the corporate power and authority
necessary to own or hold their respective properties and to
conduct the businesses in which they are engaged as described
in the Registration Statements and Prospectus.
(ii) The Company has an authorized capitalization as set forth in
the Section Captioned "Description of Capital Stock" of the
Prospectus, and all of the issued shares of capital stock of
the Company, including the Stock being delivered on the
Closing Date, have been duly and validly authorized and
issued, conform to the description thereof contained in the
Section captioned "Description of Capital Stock" of the
Prospectus, and, to our knowledge, are fully paid and
non-assessable.
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15
(iii) All the outstanding shares of capital stock of each subsidiary
of the Company have been duly authorized and validly issued,
are, to our knowledge, fully paid and nonassessable and,
except to the extent set forth in the Prospectus, are owned by
the Company directly or indirectly through one or more
wholly-owned subsidiaries, free and clear of any claim, lien,
encumbrance, security interest, restriction upon voting or
transfer or any other claim of any third party.
(iv) There are no preemptive or other rights to subscribe for or to
purchase, nor any restriction upon the voting or transfer of,
any shares of the Stock pursuant to the Company's charter or
by-laws or any agreement or other instrument known to such
counsel.
(v) This Agreement has been duly authorized, executed and
delivered by the Company.
(vi) The execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated hereby will
not conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default under any
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument that is an exhibit to the Registration
Statement known to such counsel after reasonable investigation
to which the Company or any of its subsidiaries is a party or
by which the Company or any of its subsidiaries is bound or to
which any of the properties or assets of the Company or any of
its subsidiaries is subject, nor will such actions result in
any violation of the Charter or by-laws of the Company or of
any of its subsidiaries or any statute, or any order, or
regulation (other than applicable state securities and blue
sky laws, as to which such counsel need not express art
opinion of any order or rule) of any court or governmental
agency or body or court having jurisdiction over the Company
or any of its subsidiaries or any of their properties or
assets.
(vii) Except for the registration of the Stock under the Securities
Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under the
Exchange Act and applicable state securities laws in
connection with the purchase and distribution of the Stock by
the Underwriters, no consent, approval, authorization or order
of, or filing or registration with, any such court or
governmental agency or body is required for the execution,
delivery and performance of this Agreement by the Company and
the consummation of the transactions contemplated hereby.
(viii) The description in the Registration Statement and Prospectus
of statutes, legal or governmental proceedings and contracts
and other documents are accurate in all material respects; and
to the best of such counsel's knowledge, there are no
statutes, legal or governmental proceedings, contracts or
other documents of a character required to be described in the
Registration Statement or Prospectus or to be filed as
exhibits to the Registration Statement which are not described
or filed as required.
(ix) To the best of such counsel's knowledge, neither the Company
nor any of its subsidiaries (i) is in violation of its charter
or by-laws, (ii) is in default, and
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no event has occurred, which, with notice or lapse of time or
both, would constitute a default, in the due performance or
observance of any term, covenant or condition contained in any
agreement or instrument to which it is a party or by which it
is bound or to which any of its properties or assets is
subject or (iii) is in violation of any law, ordinance,
governmental rule, regulation or court decree to which it or
its property or assets may be subject or has failed to obtain
any license, permit, certificate, franchise or other
governmental authorization or permit necessary to the
ownership of its property or to the conduct of its business
except, in the case of clauses (ii) and (iii), for those
defaults, violations or failures which, either individually or
in the aggregate, would not have a Material Adverse Effect.
(x) To the best of such counsel's knowledge and other than as set
forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property or asset of
the Company or any of its subsidiaries is the subject which,
singularly or in the aggregate, if determined adversely to
the Company or any of its subsidiaries, might have a Material
Adverse Effect or would prevent or adversely affect the
ability of the Company to perform its obligations under this
Agreement; and, to the best of such counsel's knowledge, no
such proceedings are threatened or contemplated by
governmental authorities or threatened by others.
(xi) The Registration Statement has become effective under the
Securities Act, the Rule 462(b) Registration Statement, if
any, was filed with the Commission on the date specified
therein, the Prospectus was filed with the Commission pursuant
to the subparagraph of Rule 424(b) of the Rules and
Regulations specified in such opinion on the date specified
therein and, to our knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued
and, to the knowledge of such counsel, no proceeding for that
purpose is pending before or contemplated by the Commission.
(xii) The Registration Statements, as of the respective effective
dates and the Prospectus, as of its date, and any further
amendments or supplements thereto, as of their respective
dates, made by the Company prior to the Closing Date (other
than the financial statements and other statistical data
contained therein, as to which such counsel need express no
opinion) complied as to form in all material respects with the
requirements of the Securities Act and the Rules and
Regulations; (other than the financial statements and related
schedules therein, as to which such counsel need express no
opinion), when they were filed with the Commission, complied
as to form in all material respects with the requirements of
the Exchange Act and the rules and regulations of the
Commission thereunder.
(xiii) To the best of such counsel's knowledge, no person or entity
has the right to require registration of shares of Common
Stock or other securities of the Company because of the filing
or effectiveness of the Registration Statements or otherwise,
except for persons and entities who have expressly waived such
right or who have been given proper notice and have failed to
exercise such right within the time or times required under
the terms and conditions of such right.
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(xiv) Neither the Company nor any of its subsidiaries is an
"investment company" within the meaning of the Investment
Company Act and the rules and regulations of the Commission
thereunder.
[Add clauses on other matters appropriate in the particular
case such as patents, title to property, regulatory issues
(e.g., if the issuer is a public utility, a bank, an insurance
company or a regulated carrier).]
Such counsel shall also have furnished to the Representatives
a written statement, addressed to the Underwriters and dated
the Closing Date, in form and substance satisfactory to the
Representatives, to the effect that (x) such counsel has acted
as counsel to the Company in connection with the preparation
of the Registration Statements (y) based on such counsel's
examination of the Registration Statements and such counsel's
investigations made in connection with the preparation of the
Registration Statements and "conferences with certain officers
and employees of and with auditors for and counsel to the
Company", such counsel has no reason to believe that the
Registration Statements, as of the respective effective dates,
contained any untrue statement of a material fact or omitted
to state any material fact required to be stated therein or
necessary in order to make the statements therein not
misleading, or that the Prospectus contains any untrue
statement of a material fact or omits to state any material
fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances
under which they were made, not misleading when they were
filed with the Commission; it being understood that such
counsel need express no opinion as to the financial statements
or other financial data contained in the Registration
Statement or the Prospectus.
The foregoing opinion and statement may be qualified by a
statement to the effect that such counsel has not independently verified the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus and takes no responsibility therefor
except to the extent set forth in the opinion described in clauses (viii) and
(ix) above.
(e) [insert the name of counsel to the Selling Stockholders] shall have
furnished to the Representatives such counsel's written opinion, as counsel to
the Selling Stockholders, addressed to the Underwriters and dated the Closing
Date, in form and substance reasonably satisfactory to the Representatives, to
the effect that:
(i) Each Selling Stockholder has full right, power and authority
to enter into this Agreement, the Power of Attorney and the
Custody Agreement; the execution, delivery and performance of
this Agreement, the Power of Attorney and the Custody
Agreement by each Selling Stockholder and the consummation by
each Selling Stockholder of the transactions contemplated
hereby and thereby will not conflict with or result in a
breach or violation of any of the terms or provisions of, or
constitute a default under, any statute, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which any Selling
Stockholder is a party or by which any Selling Stockholder is
bound or to which any of the property or assets of any Selling
Stockholder is subject, nor will such actions result in any
violation of
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any statute or any order, rule or regulation known to such
counsel of any court or governmental agency or body having
jurisdiction over any Selling Stockholder or the property or
assets of any Selling Stockholder; and, except for the
registration of the Stock under the Securities Act and such
consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and
applicable state securities laws in connection with the
purchase and distribution of the Stock by the Underwriters, no
consent, approval, authorization or order of, or filing or
registration with, any such court or governmental agency or
body is required for the execution, delivery and performance
of this Agreement, the Power of Attorney or the Custody
Agreement by any Selling Stockholder and the consummation by
any Selling Stockholder of the transactions contemplated
hereby and thereby.
(ii) This Agreement has been duly executed and delivered by
or on behalf of each Selling Stockholder.
(iii) A Power-of-Attorney and a Custody Agreement have been duly
executed and delivered by each Selling Stockholder and
constitute valid and binding agreements of each Selling
Stockholder.
(iv) Upon payment for, and delivery of, the shares of Stock to be
sold by each Selling Stockholder under this Agreement in
accordance with the terms hereof, the Underwriters will
acquire good and valid title to such shares, free and clear of
all liens, encumbrances, equities or claims.
(f) The Representatives shall have received from Xxxx Xxxx Xxxx &
Freidenrich LLP counsel for the Underwriters, such opinion or opinions,
dated the Closing Date, with respect to such matters as the
Underwriters may reasonably require, and the Company [and the Selling
Stockholder[s]] shall have furnished to such counsel such documents as
they request for enabling them to pass upon such matters.
(g) At the time of the execution of this Agreement, the Representatives
shall have received from PricewaterhouseCoopers LLP a letter, addressed
to the Underwriters and dated such date, in form and substance
satisfactory to the Representatives (i) confirming that they are
independent certified public accountants with respect to the Company
and its subsidiaries within the meaning of the Securities Act and the
Rules and Regulations and (ii) stating the conclusions and findings of
such firm with respect to the financial statements and certain
financial information contained or incorporated by reference in the
Prospectus.
(h) On the Closing Date, the Representatives shall have received a
letter (the "bring-down letter") from PricewaterhouseCoopers LLP
addressed to the Underwriters and dated the Closing Date confirming, as
of the date of the bring-down letter (or, with respect to matters
involving changes or developments since the respective dates as of
which specified financial information is given in the Prospectus as of
a date not more than three business days prior to the date of the
bring-down letter), the conclusions and findings of such firm with
respect to the
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financial information and other matters covered by its letter delivered
to the Representatives concurrently with the execution of this
Agreement pursuant to Section 8(g).
(i) The Company shall have furnished to the Representatives a
certificate, dated the Closing Date, of its Chairman of the Board, its
President or a Vice President and its chief financial officer stating
that (i) such officers have carefully examined the Registration
Statements and the Prospectus and, in their opinion, the Registration
Statements as of their respective effective dates and the Prospectus,
as of each such effective date, did not include any untrue statement of
a material fact and did not omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading, (ii) since the effective date of the Initial Registration
Statement no event has occurred which should have been set forth in a
supplement or amendment to the Registration Statements or the
Prospectus, (iii) to the best of their knowledge after reasonable
investigation, as of the Closing Date, the representations and
warranties of the Company in this Agreement are true and correct and
the Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied hereunder at or
prior to the Closing Date, and (iv) subsequent to the date of the most
recent financial statements [included or incorporated by reference] in
the Prospectus, there has been no material adverse change in the
financial position or results of operation of the Company and its
subsidiaries, or any change, or any development including a prospective
change, in or affecting the condition (financial or otherwise), results
of operations, business or prospects of the Company and its
subsidiaries taken as a whole, except as set forth in the Prospectus.
(j) [Each Selling Stockholder shall have furnished to the
Representatives on the Closing Date a certificate, dated the such date,
signed by, or on behalf of, the Selling Stockholder stating that the
representations, warranties and agreements of the Selling Stockholder
contained herein are true and correct as of the Closing Date and that
the Selling Stockholder has complied with all agreements contained
herein to be performed by the Selling Stockholder at or prior to the
Closing Date.]
(k) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included in the Prospectus (i) any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus (ii) since such date there shall not
have been any change in the capital stock or long-term debt of the
Company or any of its subsidiaries or any change, or any development
involving a prospective change, in or affecting the business, general
affairs, management, financial position, stockholders' equity or
results of operations of the Company and its subsidiaries, otherwise
than as set forth or contemplated in the Prospectus, the effect of
which, in any such case described in clause (i) or (ii), is, in the
judgment of the Representatives, so material and adverse as to make it
impracticable or inadvisable to proceed with the sale or delivery of
the Stock on the terms and in the manner contemplated in the
Prospectus.
(l) No action shall have been taken and no statute, rule, regulation or
order shall have been enacted, adopted or issued by any governmental
agency or body which would, as of the Closing Date, prevent the
issuance or sale of the Stock; and no injunction, restraining order or
order of any other nature by any federal or state court of competent
jurisdiction shall have been issued as of the Closing Date which would
prevent the issuance or sale of the Stock.
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(m) Subsequent to the execution and delivery of this Agreement there
shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange or the American Stock Exchange
or in the over-the-counter market, or trading in any securities of the
Company on any exchange or in the over-the-counter market, shall have
been suspended or minimum prices shall have been established on any
such exchange or such market by the Commission, by such exchange or by
any other regulatory body or governmental authority having
jurisdiction, (ii) a banking moratorium shall have been declared by
Federal or state authorities, (iii) the United States shall have become
engaged in hostilities, there shall have been an escalation in
hostilities involving the United States or there shall have been a
declaration of a national emergency or war by the United States or (iv)
there shall have occurred such a material adverse change in general
economic, political or financial conditions (or the effect of
international conditions on the financial markets in the United States
shall be such) as to make it, in the judgment of the Representatives,
impracticable or inadvisable to proceed with the sale or delivery of
the Stock on the terms and in the manner contemplated in the
Prospectus.
(n) The Nasdaq National Market System shall have approved the Stock for
listing, subject only to official notice of issuance and evidence of
satisfactory distribution.
(o) XX Xxxxx shall have received the written agreements, substantially
in the form of Exhibit I hereto, of the officers, directors and
stockholders of the Company listed in Schedule C to this Agreement.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Underwriters.
7. INSURANCE. The Selling Stockholder[s] will provide, not later than the First
Closing Date, a policy or undertaking of [insert name of insurance company], or
other insurers, in form satisfactory to the Representatives, indemnifying and
holding harmless in the aggregate amount of $[ ] each Underwriter Indemnified
Party (as defined below) in priority to any others insured against any losses,
claims, damages or liabilities, or expenses incurred in connection therewith,
joint or several, to which such Underwriter Indemnified Party may become subject
under the Securities Act or otherwise and which such Underwriter Indemnified
Party may become subject under the Securities Act or otherwise and which arise
out of the purchase, offering or sale by such Underwriter of the shares of Stock
sold by the Selling Stockholder[s]. Such insurance may provide for a deductible
amount not in excess of $[ ].]
8. INDEMNIFICATION AND CONTRIBUTION.
(a) For purposes of this Section 8, "Company" shall include the Company
and all subsidiaries thereof. The Company shall indemnify and hold
harmless each Underwriter, its officers, employees, representatives and
agents and each person, if any, who controls any Underwriter within the
meaning of the Securities Act (collectively, the "Underwriter
Indemnified Parties" and each, an "Underwriter Indemnified Party")
against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which that Underwriter Indemnified Party
may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of or is based
upon (i) any untrue statement or alleged untrue statement of a material
fact contained in the Preliminary Prospectus, the Registration
Statements or the Prospectus or in any amendment or supplement thereto
(ii) the omission or alleged omission to state in any Preliminary
Prospectus, the Registration Statements or the Prospectus or in any
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amendment or supplement thereto a material fact required to be stated
therein or necessary to make the statements therein not misleading or
(iii) any act or failure to act, or any alleged act or failure to act,
by any Underwriter in connection with, or relating in any manner to,
the Stock or the offering contemplated hereby, and which is included as
part of or referred to in any loss, claim, damage, liability or action
arising out of or based upon matters covered by clause (i) or (ii)
above, (provided that the Company shall not be liable in the case of
any matter covered by this clause (iii) to the extent that it is
determined in a final judgement by a court of competent jurisdiction
that such loss, claim, damage, liability or action resulted directly
from any such act or failure to act undertaken or omitted to be taken
by such Underwriter through its gross negligence or willful misconduct)
and shall reimburse each Underwriter Indemnified Party promptly upon
demand for any legal or other expenses reasonably incurred by that
Underwriter Indemnified Party in connection with investigating or
preparing to defend or defending against or appearing as a third party
witness in connection with any such loss, claim, damage, liability or
action as such expenses are incurred; provided, however, that the
Company shall not be liable in any such case to the extent that any
such loss, claim, damage, liability or action arises out of or is based
upon (i) an untrue statement or alleged untrue statement in or omission
or alleged omission from the Preliminary Prospectus, the Registration
Statements or the Prospectus or any such amendment or supplement in
reliance upon and in conformity with written information furnished to
the Company through the Representatives by or on behalf of any
Underwriter specifically for use therein, which information the parties
hereto agree is limited to the Underwriter's Information (as defined in
Section 17). This indemnity agreement is not exclusive and will be in
addition to any liability which the Company might otherwise have and
shall not limit any rights or remedies which may otherwise be available
at law or in equity to each Underwriter Indemnified Party.
(b) [The Selling Shareholder[s] [, jointly and severally] shall
indemnify and hold harmless each Underwriter Indemnified Party, against
any loss, claim, damage or liability, joint or several, or any action
in respect thereof, to which that Underwriter Indemnified may become
subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage, liability or action arises out of or is based upon (i)
any untrue statement or alleged untrue statement of a material fact
contained in the Preliminary Prospectus, either of the Registration
Statements or the Prospectus or in any amendment or supplement thereto
or (ii) the omission or alleged omission to state in any Preliminary
Prospectus, either of the Registration Statements or the Prospectus or
in any amendment or supplement thereto a material fact required to be
stated therein or necessary to make the statements therein not
misleading and shall reimburse each Underwriter Indemnified Party
promptly upon demand for any legal or other expenses reasonably
incurred by that Underwriter Indemnified Party in connection with
investigating or preparing to defend or defending against or appearing
as a third party witness in connection with any such loss, claim,
damage, liability or action as such expenses are incurred; provided,
however, [if the Selling Shareholders have obtained an insurance policy
for the benefit of the underwriters - the liability of the Selling
Shareholders under this Section 8 shall be limited to the amount of
losses, claims, damages or liabilities which are not covered and paid
by the insurance referred to in Section 7 (whether by reason of being
within the deductible amount or for any other reason); provided,
further however, that the foregoing indemnification agreement with
respect to the Preliminary Prospectus shall not inure to the benefit of
any Underwriter from whom the person asserting any such loss, claim,
damage or liability purchased Securities, or any officers, employees,
representatives, agents or controlling persons of such Underwriter, if
(i) a copy of the Prospectus (as then amended or supplemented) was
required by law to be delivered to such person at or prior to the
written confirmation of the sale of Securities to such person, (ii) a
copy of the Prospectus (as then amended or supplemented) was not sent
or given to such person by or on behalf of such
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Underwriter and such failure was not due to non-compliance by the
Company with Section 4[(I)](d), and (iii) the Prospectus (as so amended
or supplemented) would have cured the defect giving rise to such loss,
claim, damage or liability.] This indemnity agreement is not exclusive
and will be in addition to any liability which the Selling Shareholders
might otherwise have and shall not limit any rights or remedies which
may otherwise be available at law or in equity to each Underwriter
Indemnified Party.]
(c) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Company its officers, employees, representatives and
agents, each of its directors and each person, if any, who controls the
Company within the meaning of the Securities Act (collectively the
"Company Indemnified Parties" and each a "Company Indemnified Party")
[and the Selling Stockholder[s], their respective officers, employees,
representatives and agents and each person, if any, who controls the
Selling Stockholders within the meaning of the Securities Act
(collectively, the "Stockholder Indemnified Parties" and each a
"Stockholder Indemnified Party"),] against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which
the Company Indemnified Parties [or the Selling Stockholder Indemnified
Parties] may become subject, under the Securities Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of
or is based upon (i) any untrue statement or alleged untrue statement
of a material fact contained in the Preliminary Prospectus, either of
the Registration Statements or the Prospectus or in any amendment or
supplement thereto or (ii) the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, but in each case only to
the extent that the untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company through
the Representatives by or on behalf of that Underwriter specifically
for use therein, and shall reimburse the Company Indemnified Parties
[and the Selling Stockholder Indemnified Parties] for any legal or
other expenses reasonably incurred by such parties in connection with
investigating or preparing to defend or defending against or appearing
as third party witness in connection with any such loss, claim, damage,
liability or action as such expenses are incurred; provided that the
parties hereto hereby agree that such written information provided by
the Underwriters consists solely of the Underwriter's Information. This
indemnity agreement is not exclusive and will be in addition to any
liability which the Underwriters might otherwise have and shall not
limit any rights or remedies which may otherwise be available at law or
in equity to the Company Indemnified Parties and Selling Stockholder
Indemnified Parties.
(d) Promptly after receipt by an indemnified party under this Section 8
of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under this Section 8, notify the
indemnifying party in writing of the claim or the commencement of that
action; provided, however, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have under
this Section 8 except to the extent it has been materially prejudiced
by such failure; and, provided, further, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may
have to an indemnified party otherwise than under this Section 8. If
any such claim or action shall be brought against an indemnified party,
and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that
it wishes, jointly with any other similarly notified indemnifying
party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume
the defense of such claim or action, the indemnifying party shall not
be liable to the indemnified party under this Section 8 for any legal
or
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other expenses subsequently incurred by the indemnified party in
connection with the defense thereof other than reasonable costs of
investigation; provided, however, that any indemnified party shall have
the right to employ separate counsel in any such action and to
participate in the defense thereof but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless (i)
the employment thereof has been specifically authorized by the
indemnifying party in writing, (ii) such indemnified party shall have
been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to
those available to the indemnifying party and in the reasonable
judgment of such counsel it is advisable for such indemnified party to
employ separate counsel or (iii) the indemnifying party has failed to
assume the defense of such action and employ counsel reasonably
satisfactory to the indemnified party, in which case, if such
indemnified party notifies the indemnifying party in writing that it
elects to employ separate counsel at the expense of the indemnifying
party, the indemnifying party shall not have the right to assume the
defense of such action on behalf of such indemnified party, it being
understood, however, that the indemnifying party shall not, in
connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction arising out of the
same general allegations or circumstances, be liable for the reasonable
fees and expenses of more than one separate firm of attorneys at any
time for all such indemnified parties, which firm shall be designated
in writing by XX Xxxxx, if the indemnified parties under this Section
8 consist of any Underwriter Indemnified Party, or by the Company if
the indemnified parties under this Section 8 consist of any Company
Indemnified Parties. Each indemnified party, as a condition of the
indemnity agreements contained in Sections 8(a), 8(b) [and 8(c)], shall
use all reasonable efforts to cooperate with the indemnifying party in
the defense of any such action or claim. Subject to the provisions of
Section 8(e) below, no indemnifying party shall be liable for any
settlement of any such action effected without its written consent
(which consent shall not be unreasonably withheld), but if settled with
its written consent or if there be a final judgment for the plaintiff
in any such action, the indemnifying party agrees to indemnify and
hold harmless any indemnified party from and against any loss or
liability by reason of such settlement or judgment.
(e) If at any time an indemnified party shall have requested that an
indemnifying party reimburse the indemnified party for fees and
expenses of counsel, such indemnifying party agrees that it shall be
liable for any settlement of the nature contemplated by this Section 8
effected without its written consent if (i) such settlement is entered
into more than 45 days after receipt by such indemnifying party of the
request for reimbursement, (ii) such indemnifying party shall have
received notice of the terms of such settlement at least 30 days prior
to such settlement being entered into and (iii) such indemnifying party
shall not have reimbursed such indemnified party in accordance with
such request prior to the date of such settlement.
(f) If the indemnification provided for in this Section 8 is
unavailable or insufficient to hold harmless an indemnified party under
Section 8(a), 8(b) or 8(c), then each indemnifying party shall, in lieu
of indemnifying such indemnified party, contribute to the amount paid
or payable by such indemnified party as a result of such loss, claim,
damage or liability, or action in respect thereof, (i) in such
proportion as shall be appropriate to reflect the relative benefits
received by the Company and the Selling Stockholders on the one hand
and the Underwriters on the other from the offering of the Stock or 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 the Company and the Selling Stockholders on the one
hand and the Underwriters on the other with respect to the statements
or omissions which resulted in such loss, claim, damage or liability,
or action in respect thereof, as well as any other relevant equitable
considerations. The relative benefits received by the
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Company and the Selling Stockholders on the one hand and the
Underwriters on the other with respect to such offering shall be deemed
to be in the same proportion as the total net proceeds from the
offering of the Stock purchased under this Agreement (before deducting
expenses) received by the Company and the Selling Stockholders bear to
the total underwriting discounts and commissions received by the
Underwriters with respect to the Stock purchased under this Agreement,
in each case as set forth in the table on the cover page of the
Prospectus. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material
fact relates to information supplied by the Company or the Selling
Stockholders on the one hand or the Underwriters on the other, the
intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue statement
or omission; provided that the parties hereto agree that the written
information furnished to the Company through the Representatives by or
on behalf of the Underwriters for use in any Preliminary Prospectus,
the Registration Statements or the Prospectus consists solely of the
Underwriter's Information. The Company, the Selling Stockholders and
the Underwriters agree that it would not be just and equitable if
contributions pursuant to this Section 8(f) 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
herein. The amount paid or payable by an indemnified party as a result
of the loss, claim, damage or liability, or action in respect thereof,
referred to above in this Section 8(f) shall be deemed to include, for
purposes of this Section 8(f), any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of
this Section 8(f), no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the
Stock underwritten by it and distributed to the public were offered to
the public less the amount of any damages which such Underwriter has
otherwise paid or become liable to pay by reason of any untrue or
alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent
misrepresentation.
The Underwriters' obligations to contribute as provided in
this Section 8(f) are several in proportion to their respective underwriting
obligations and not joint.
9. TERMINATION. The obligations of the Underwriters hereunder may be terminated
by XX Xxxxx, in its absolute discretion by notice given to and received by the
Company prior to delivery of and payment for the Firm Stock if, prior to that
time, any of the events described in Sections 6(k) or 6(m) have occurred or if
the Underwriters shall decline to purchase the Stock for any reason permitted
under this Agreement.
10. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If (a) this Agreement shall have
been terminated pursuant to Section 9 or 11, (b) the Company [or any Selling
Stockholder] shall fail to tender the Stock for delivery to the Underwriters for
any reason permitted under this Agreement, or (c) the Underwriters shall decline
to purchase the Stock for any reason permitted under this Agreement the Company
[and the Selling Stockholder[s]] shall reimburse the Underwriters for the fees
and expenses of their counsel and for such other out-of-pocket expenses as shall
have been reasonably incurred by them in connection with this Agreement and the
proposed purchase of the Stock, and upon demand the Company [and the Selling
Stockholder[s]] shall pay the full amount thereof to the XX Xxxxx. If this
Agreement is terminated pursuant to Section 11 by reason of the default of one
or more Underwriters, [the Company
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shall not] [neither the Company nor [any] Selling Stockholder shall] be
obligated to reimburse any defaulting Underwriter on account of those expenses.
11. SUBSTITUTION OF UNDERWRITERS. If any Underwriter or Underwriters shall
default in its or their obligations to purchase shares of Stock hereunder and
the aggregate number of shares which such defaulting Underwriter or Underwriters
agreed but failed to purchase does not exceed ten percent (10%) of the total
number of shares underwritten, the other Underwriters shall be obligated
severally, in proportion to their respective commitments hereunder, to purchase
the shares which such defaulting Underwriter or Underwriters agreed but failed
to purchase. If any Underwriter or Underwriters shall so default and the
aggregate number of shares with respect to which such default or defaults occur
is more than ten percent (10%) of the total number of shares underwritten and
arrangements satisfactory to the Representatives and the Company for the
purchase of such shares by other persons are not made within forty-eight (48)
hours after such default, this Agreement shall terminate.
If the remaining Underwriters or substituted Underwriters are
required hereby or agree to take up all or part of the shares of Stock of a
defaulting Underwriter or Underwriters as provided in this Section 11, (i) the
Company [and the Selling Stockholder[s]] shall have the right to postpone the
Closing Dates for a period of not more than five (5) full business days in order
that the Company [and the Selling Stockholder[s]] may effect whatever changes
may thereby be made necessary in the Registration Statement or the Prospectus,
or in any other documents or arrangements, and the Company agrees promptly to
file any amendments to the Registration Statement or supplements to the
Prospectus which may thereby be made necessary, and (ii) the respective numbers
of shares to be purchased by the remaining Underwriters or substituted
Underwriters shall be taken as the basis of their underwriting obligation for
all purposes of this Agreement. Nothing herein contained shall relieve any
defaulting Underwriter of its liability to the Company[, the Selling
Stockholder[s]] or the other Underwriters for damages occasioned by its default
hereunder. Any termination of this Agreement pursuant to this Section 11 shall
be without liability on the part of any non-defaulting Underwriter[, the Selling
Stockholder[s]] or the Company, except expenses to be paid or reimbursed
pursuant to Sections 5 and 10 and except the provisions of Section 8 shall not
terminate and shall remain in effect.
12. SUCCESSORS; PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall
inure to the benefit of and be binding upon the several Underwriters, the
Company and the Selling Stockholders and their respective successors. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any person other than the persons mentioned in the preceding sentence any
legal or equitable right, remedy or claim under or in respect of this Agreement,
or any provisions herein contained, this Agreement and all conditions and
provisions hereof being intended to be and being for the sole and exclusive
benefit of such persons and for the benefit of no other person; except that the
representations, warranties, covenants, agreements and indemnities of the
Company and the Selling Stockholders contained in this Agreement shall also be
for the benefit of the Underwriter Indemnified Parties, and the indemnities of
the several Underwriters shall also be for the benefit of the Company
Indemnified Parties and the Selling Stockholder Indemnified Parties.
13. SURVIVAL OF INDEMNITIES, REPRESENTATIONS, WARRANTIES, ETC. The respective
indemnities, covenants, agreements, representations, warranties and other
statements of the Company the Selling Stockholders and the several Underwriters,
as set forth in this Agreement or made by them respectively, pursuant to this
Agreement, shall remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter, the Selling Stockholders,
the Company or any person controlling any of them and shall survive delivery of
and payment for the Stock.
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14. NOTICES. All statements, requests, notices and agreements hereunder shall be
in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail, telex
or facsimile transmission to SG Securities Corporation Attention:
[________] (Fax: 212-[000-0000]);
(b) if to the Company shall be delivered or sent by mail, telex or
facsimile transmission to Crossroads Systems, Inc., 0000 Xxxxxxxx
Xxxxxxxxx, Xxxxx XX-000, Xxxxxx, Xxxxx 00000, Attention: Xxxxx X. Xxxxx
(Fax: 000-000-0000);
(c) if to any Selling Stockholders, shall be delivered or sent by mail,
telex or facsimile transmission to such Selling Stockholder at the
address set forth on Schedule B hereto; provided, however, that any
notice to an Underwriter pursuant to Section 8 shall be delivered or
sent by mail, telex or facsimile transmission to such Underwriter at
its address set forth in its acceptance telex to the Representatives,
which address will be supplied to any other party hereto by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof.
15. DEFINITION OF CERTAIN TERMS. For purposes of this Agreement, (a) "business
day" means any day on which the New York Stock Exchange, Inc. is open for
trading and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
16. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
17. UNDERWRITERS' INFORMATION. The parties hereto acknowledge and agree that,
for all purposes of this Agreement, the Underwriters' Information consists
solely of the following information in the Prospectus: (i) the last paragraph
on the front cover page concerning the terms of the offering by the
Underwriters; and (ii) the statements concerning the Underwriters contained in
the [To Come] under the heading "Underwriting."
18. AUTHORITY OF THE REPRESENTATIVES. In connection with this Agreement, you
will act for and on behalf of the several Underwriters, and any action taken
under this Agreement by the Representatives, will be binding on all the
Underwriters; and any action taken under this Agreement by any of the
Attorneys-in-fact will be binding on all the Selling Stockholders.
19. PARTIAL UNENFORCEABILITY. The invalidity or unenforceability of any Section,
paragraph or provision of this Agreement shall not affect the validity or
enforceability of any other Section, paragraph or provision hereof. If any
Section, paragraph or provision of this Agreement is for any reason determined
to be invalid or unenforceable, there shall be deemed to be made such minor
changes (and only such minor changes) as are necessary to make it valid and
enforceable.
20. GENERAL. This Agreement constitutes the entire agreement of the parties to
this Agreement and supersedes all prior written or oral and all contemporaneous
oral agreements, understandings and negotiations with respect to the subject
matter hereof. In this Agreement, the masculine, feminine and neuter genders and
the singular and the plural include one another. The section headings in this
Agreement are for the convenience of the parties only and will not affect the
construction or interpretation of this Agreement. This Agreement may be amended
or modified, and the observance of any
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term of this Agreement may be waived, only by a writing signed by the Company,
the Selling Stockholders and the Representatives.
21. COUNTERPARTS. This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
Any person executing and delivering this Agreement as
Attorney-in-fact for the Selling Stockholders represents by so doing that he has
been duly appointed as Attorney-in-fact by such Selling Stockholder pursuant to
a validly existing and binding Power of Attorney which authorizes such
Attorney-in-fact to take such action.
If the foregoing is in accordance with your understanding of
the agreement between the Company, the Selling Stockholders and the several
Underwriters, kindly indicate your acceptance in the space provided for that
purpose below.
Very truly yours,
CROSSROADS SYSTEMS INC.
By:
------------------------------------
Name:
Title:
[SELLING STOCKHOLDER[S] LISTED IN
SCHEDULE B]
By: [Attorney-in-fact]
By:
------------------------------------
[Attorney-in-fact]
Acting [on [his] [her] [their] own
behalf and] on behalf of the Selling
Stockholder[s] listed in Schedule B.]
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Accepted as of the date first above written:
XX XXXXX SECURITIES CORPORATION
Acting on its own behalf
And as a Representative of several
Underwriters referred to in the
Foregoing Agreement.
By: XX XXXXX SECURITIES CORPORATION
By:
---------------------------------------------
Name:
Title:
XXXX XXXXXXXX XXXXXXX
Acting on its own behalf
And as a Representative of several
Underwriters referred to in the
Foregoing Agreement.
By: XXXX XXXXXXXX XXXXXXX
By:
---------------------------------------------
Name:
Title:
XXXXXX XXXXXX & COMPANY, INC.
Acting on its own behalf
And as a Representative of several
Underwriters referred to in the
Foregoing Agreement.
By: XXXXXX XXXXXX & COMPANY, INC.
By:
---------------------------------------------
Name:
Title:
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SCHEDULE A
Number Number of
of Firm Optional
Shares Shares
to be to be
Name Purchased Purchased
---- --------- ----------
XX Xxxxx Securities Corporation
========= ==========
Total
========= ==========
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SCHEDULE B
Selling Stockholder[s] Number of Number of
---------------------- Firm Optional
Shares to Shares to
be Sold be Sold
--------- ---------
[Name and address]
========= =========
Total
========= =========
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SCHEDULE C
[list of stockholders subject to Section 4(h)]
32
Exhibit I
[Form of Lock-Up Agreement]
[Date]
XX Xxxxx Securities Corporation
[Name of Co-Representatives]
As Representatives of the
several Underwriters
c/o XX Xxxxx Securities Corporation
Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: [Company] ___________ Shares of Common Stock
Dear Sirs:
In order to induce XX Xxxxx Securities Corporation ("XX
Xxxxx") [and _____________ (together with XX Xxxxx,] the "Representatives"), to
enter in to a certain underwriting agreement with [Company], a ______________
corporation (the "Company"), with respect to the public offering of shares of
the Company's Common Stock, par value $_ per share ("Common Stock"), the
undersigned hereby agrees that for a period of [180] days following the date of
the final prospectus filed by the Company with the Securities and Exchange
Commission in connection with such public offering, the undersigned will not,
without the prior written consent of XX Xxxxx, directly or indirectly, offer,
sell, assign, transfer, pledge, contract to sell, or otherwise dispose of, any
shares of Common Stock (including, without limitation, Common Stock which may be
deemed to be beneficially owned by the undersigned in accordance with the rules
and regulations promulgated under the Securities Act of 1933, as the same may be
amended or supplemented from time to time (such shares, the "Beneficially Owned
Shares")) or securities convertible into or exercisable or exchangeable in
Common Stock.
Anything contained herein to the contrary notwithstanding, any
person to whom shares of Common Stock or Beneficially Owned Shares are
transferred from the undersigned shall be bound by the terms of this Agreement.
[In addition, the undersigned hereby waives, from the date
hereof until the expiration of the [one-year] period following the date of the
Company's final Prospectus, any and all rights, if any, to request or demand
registration pursuant to the Securities Act of any shares of Common Stock that
are registered in the name of the undersigned or that are Beneficially Owned
Shares. In order to enable the aforesaid Managing Director covenants to be
enforced, the undersigned hereby consents to the placing of legends and/or
stop-transfer orders with the transfer agent of the Common Stock with respect to
any shares of Common Stock or Beneficially Owned Shares.]
[Signatory]
By:
----------------------------------------
Name:
Title:
