FORM OF UNDERWRITING AGREEMENT
EXHIBIT
1.1
FORM
OF UNDERWRITING AGREEMENT
Healthy
Fast Food, Inc.
dated
_____________, 2007
Xxxxxxx
Investment Company, Inc.
_______________,
2007
Xxxxxxx
Investment Company, Inc.
000
XX
Xxxxx Xxxxxxx
Xxxxxxxx,
Xxxxxx 00000
Ladies
and Gentlemen:
The
Company confirms its agreement with
the Underwriters as follows:
The
Company represents, warrants and
covenants to each Underwriter as follows:
information
deemed to be a part thereof at the time of effectiveness pursuant to Rule 430A,
Rule 430B or Rule 430C under the Securities Act, or pursuant to the Securities
Exchange Act of 1934 and the rules and regulations promulgated thereunder
(collectively, the “Exchange Act”), is called the “Registration
Statement.” Any registration statement filed by the Company
pursuant to Rule 462(b) under the Securities Act is called the “Rule 462(b)
Registration Statement,” and from and after the date and time of filing of
the Rule 462(b) Registration Statement the term “Registration Statement”
shall include the Rule 462(b) Registration Statement. Such
prospectus, in the form first filed pursuant to Rule 424(b) under the Securities
Act after the date and time that this Agreement is executed and delivered by
the
parties hereto (the “Execution Time”), or, if no filing pursuant to Rule
424(b) under the Securities Act is required, the form of final prospectus
relating to the Units included in the Registration Statement at the effective
date of the Registration Statement, is called the
“Prospectus.” All references in this Agreement to the
Registration Statement, the Rule 462(b) Registration Statement, the Company’s
preliminary prospectus included in the Registration Statement (each a
“preliminary prospectus”), the Prospectus, or any amendments or
supplements to any of the foregoing, shall include any copy thereof filed with
the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
System (“XXXXX”). Any reference herein to any preliminary
prospectus or the Prospectus or any supplement or amendment to either thereof
shall be deemed to refer to and include any documents incorporated by reference
therein as of the date of such reference.
Each
preliminary prospectus and the Prospectus when filed complied or will comply
in
all material respects with the Securities Act and, if filed by electronic
transmission pursuant to XXXXX (except as may be permitted by Regulation S-T
under the Securities Act), was identical in content to the copy thereof
delivered to the Underwriters for use in connection with the offer and sale
of
the Units other than with respect to any artwork and graphics that were not
filed. Each of the Registration Statement, any Rule 462(b)
Registration Statement and any post-effective amendment thereto, at the time
it
became effective and at all subsequent times until the expiration of the
prospectus delivery period required under Section 4(3) of the Securities Act,
complied and will comply in all material respects with the Securities Act and
did not and will not contain any untrue statement of a material fact or omit
to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading. The Prospectus (including any
Prospectus wrapper), as amended or supplemented, as of its date and at all
subsequent times until the Underwriters have completed their distribution of
the
offering of the Units, did not and will not contain any untrue statement of
a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading. The representations and warranties set forth in
the two immediately preceding sentences do not apply to statements in or
omissions from the Registration Statement, any Rule 462(b) Registration
Statement, or any post-effective
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amendment
thereto, or the Prospectus, or any amendments or supplements thereto, made
in
reliance upon and in conformity with information relating to any Underwriter
furnished to the Company in writing by the Representative expressly for use
therein, it being understood and agreed that the only such information furnished
by the Representative consists of the information described as such in Section
8
hereof. There are no contracts or other documents required to be
described in the Prospectus or to be filed as exhibits to the Registration
Statement that have not been described or filed as required.
(e) Issuer
Free Writing Prospectuses. No Issuer Free Writing Prospectus
includes any information that conflicts with the information contained in the
Registration Statement, including any document incorporated by reference therein
that has not been superseded or modified. The foregoing sentence does
not apply to statements in or omissions from any Issuer Free Writing Prospectus
based upon and in conformity with written information furnished to the Company
by any Underwriter through the Representative specifically for use therein,
it
being understood and agreed that the only such information furnished by any
Underwriter consists of the information described as such in Section 8
hereof.
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(h) The
Underwriting Agreement. This Agreement has been duly
authorized (to the extent applicable), executed and delivered by, and is a
valid
and binding agreement of, the Company, enforceable in accordance with its terms,
except as rights to indemnification hereunder may be limited by applicable
law
and except as the enforcement hereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable
principles.
(i) Authorization
of the Common Stock; Validity of Warrants and Warrant
Agreement.
(i) The
Common Stock included in the Units to be purchased by the Underwriters from
the
Company (including units purchasable on exercise of the Underwriters’
overallotment option described in Section 2(c) and the Representative’s Warrants
described in Section 2(h)) has been duly authorized and reserved for issuance
and sale pursuant to this Agreement and, in the case of Common Stock issuable
on
exercise of the Representative’s Warrants, the terms thereof and, when so issued
and delivered by the Company, will be validly issued, fully paid and
nonassessable.
(ii) The
Warrants included in the Units to be purchased by the Underwriters from the
Company have been duly and validly authorized by all required corporate actions
and will, when issued and delivered by the Company pursuant to this Agreement,
be validly executed and delivered by, and will be valid and binding agreements
of, the Company, enforceable in accordance with their terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles.
(iii) The
Representative’s Warrants have been duly and validly authorized by all required
corporate actions and will, when issued and delivered by the Company pursuant
to
this Agreement, be validly executed and delivered by, and will be valid and
binding agreements of, the Company, enforceable in accordance with their terms,
except as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting the
rights and remedies of creditors or by general equitable
principles.
(iv) The
Common Stock issuable on exercise of the Warrants has been duly authorized
and
reserved for issuance and sale pursuant to their terms and, when issued
and delivered by the Company pursuant to such warrants, will be validly issued,
fully paid and nonassessable.
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(v) The
Warrant Agreement has been duly and validly authorized by all required corporate
actions of the Company and will, when executed and delivered (and assuming
due
and valid execution by the Warrant Agent) constitute a valid and binding
agreement of the Company, enforceable against the Company in accordance with
its
terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to or
affecting the rights and remedies of creditors or by general equitable
principles.
(vi) Each
of the Warrants and the Representative’s Warrants will, when issued, possess
rights, privileges, and characteristics as represented in the most recent form
of Warrant Agreement or Representative’s Warrants, as the case may be, filed as
an exhibit to the Registration Statement.
(m) Preparation
of the Financial Statements. Each of the historical and
pro-forma financial statements filed with the Commission as a part of or
incorporated by reference in the Registration Statement, and included or
incorporated by reference in the Disclosure Package and the Prospectus, presents
fairly the information provided as of and at the dates and for the
periods
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indicated. Such
financial statements comply as to form with the applicable accounting
requirements of the Securities Act and have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the periods involved, except as may be expressly stated in the
related notes thereto. No other financial statements or supporting
schedules are required to be included or incorporated by reference in the
Registration Statement. Each item of historical or pro-forma
financial data relating to the operations, assets or liabilities of the Company
set forth in summary form in each of the preliminary prospectus and the
Prospectus fairly presents such information on a basis consistent with that
of
the complete financial statements contained in the Registration
Statement.
6
7
required
to be set forth in the Disclosure Package and the Prospectus and are not
described in all material respects. None of the technology employed
by the Company has been obtained or is being used by the Company in violation
of
any contractual obligation binding on the Company or, to the Company’s
knowledge, any of its officers, directors or employees or otherwise in violation
of the rights of any persons.
(w) Company
Not an “Investment Company.” The Company has been
advised of the rules and requirements under the Investment Company Act of 1940,
as amended (the “Investment Company Act”). The Company is not,
and after receipt of payment for the Units and the application of the proceeds
thereof as contemplated under the caption “Use of Proceeds” in each of the
preliminary prospectus and the Prospectus will not be, an “investment company”
within the meaning of the Investment Company Act and will conduct its business
in a manner so that it will not become subject to the Investment Company
Act.
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believes
that it will be able (i) to renew its existing insurance coverage as and when
such policies expire or (ii) to obtain comparable coverage from similar
institutions as may be necessary or appropriate to conduct its business as
now
conducted and at a cost that would not result in a Material Adverse
Change. The Company has not been denied any insurance coverage which
it has sought or for which it has applied.
(aa) Disclosure Controls and
Procedures. The Company has established and maintains disclosure
controls and procedures (as such term is defined in Rule 13a-15(e) under the
Exchange Act), which (i) are designed to ensure that material information
relating to the Company is made known to the Company’s principal executive
officer and its principal financial officer by others within those entities,
particularly during the periods in which the periodic reports required under
the
Exchange Act are being prepared, (ii) will be evaluated for effectiveness as
of
the end of each fiscal quarter and fiscal year of the Company and (iii) are
effective in all material respects to perform the functions for which they
were
established. The Company is not aware of (a) any significant
deficiency in the design or operation of internal controls which could adversely
affect the Company’s ability to record, process, summarize and report financial
data or any material weaknesses in internal controls or (b) any fraud, whether
or not material, that involves management or other employees who have a
significant role in the Company’s internal controls.
9
10
termination
of, or withdrawal from, any “employee benefit plan” or (ii) Sections 412, 4971,
4975 or 4980B of the Code. Each “employee benefit plan” established
or maintained by the Company, or any of its ERISA Affiliates that is intended
to
be qualified under Section 401(a) of the Code is so qualified and nothing has
occurred, whether by action or failure to act, which would cause the loss of
such qualification.
(gg) Material
Understandings, Generally. Except as fairly described in the
Prospectus and the Disclosure Package, the Company has not made a determination
to take any action and is not a party to any understanding, whether or not
legally binding, with any other person with respect to the taking of any action
that, if known to prospective purchasers of the Units, would be likely to affect
their assessment of the value or prospects of the Company or their decision
to
invest in the Units.
Any
certificate signed by an officer of
the Company and delivered to the Representative or to counsel for the
Underwriters shall be deemed to be a representation and warranty by the Company
to each Underwriter as to the matters set forth therein.
The
Company acknowledges that the Underwriters and, for purposes of the opinions
to
be delivered pursuant to Section 5 hereof, counsel to the Company and counsel
to
the Underwriters, will rely upon the accuracy and truthfulness of the foregoing
representations and hereby consents to such reliance.
(a) The
Firm Units. Upon the terms herein set forth, the
Company agrees to issue and sell the Firm Units to the several
Underwriters. On the basis of the representations, warranties and
agreements herein contained, and upon the terms but subject to the conditions
herein set forth, the Underwriters agree, severally and not jointly, to purchase
the Firm Units from the Company. The purchase price per Firm Unit to
be paid by the several Underwriters to the Company shall be $________ per
Unit.
(b) The
First Closing Date. Delivery of the Firm Units to be
purchased by the Underwriters and payment therefor shall be made at 9:00 a.m.
New York time on ___________, 2007, or such other time and date as the
Representative shall designate by notice to the Company (the time and date
of
such closing are called the “First Closing Date”). The Company hereby
acknowledges that circumstances under which the Representative may provide
notice to postpone the First Closing Date as originally scheduled include,
but
are in no way limited to, any determination by the Company or the Representative
to recirculate to the public copies of an amended
or supplemented Prospectus or Disclosure Package or a delay as contemplated
by
the provisions of Section 10.
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(c) The
Optional Units; Each Subsequent Closing Date. In
addition, on the basis of the representations, warranties and agreements herein
contained, and upon the terms but subject to the conditions herein set forth,
the Company hereby grants an option to the Underwriters to purchase up to an
aggregate of 375,000 Optional Units from the Company at the purchase price
per
share to be paid by the Underwriters for the Firm Units. The option
granted hereunder may be exercised at any time and from time to time upon notice
by the Representative to the Company which notice may be given at any time
within 45 days from the date of this Agreement. Such notice shall set
forth (i) the aggregate number of Optional Units as to which the Underwriters
are exercising the option, (ii) the names and denominations in which the
Optional Units are to be registered and (iii) the time, date and place at which
such Optional Units will be delivered (which time and date may be simultaneous
with, but not earlier than, the First Closing Date; and in such case the term
“First Closing Date” shall refer to the time and date of delivery of the Firm
Units and the Optional Units). Each time and date of delivery, if
subsequent to the First Closing Date, is called the “Subsequent Closing
Date” and shall be determined by the Representative and shall not be earlier
than three nor later than five full business days after delivery of such notice
of exercise.
(d) Public
Offering of the Units. The Representative hereby
advises the Company that the Underwriters intend to offer for sale to the
public, as described in the Prospectus, their respective portions of the Units
as soon after this Agreement has been executed and the Registration Statement
has been declared effective as the Representative, in its sole judgment, has
determined is advisable and practicable.
(e) Payment
for the Units. Payment for the Units to be sold by the
Company shall be made at the First Closing Date (and, if applicable, at any
Subsequent Closing Date) by wire transfer of immediately available funds to
the
order of the Company.
It
is
understood that the Representative has been authorized, for its own account
and
the accounts of the several Underwriters, to accept delivery of and receipt
for,
and make payment of the purchase price for, the Firm Units and any Optional
Units the Underwriters have agreed to purchase. The Representative,
individually and not as the Representative of the Underwriters, may (but shall
not be obligated to) make payment for any Units to be purchased by any
Underwriter whose funds shall not have been received by the Representative
by
the First Closing Date or any Subsequent Closing Date, as the case may be,
for
the account of such Underwriter, but any such payment shall not relieve such
Underwriter from any of its obligations under this Agreement.
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(g) Delivery
of Prospectus to the Underwriters. Not later than 10:00
p.m. on the second business day following the date the Units are first released
by the Underwriters for sale to the public, the Company shall deliver or cause
to be delivered, copies of the Prospectus in such quantities and at such places
as the Representative shall request.
The
Company covenants and agrees with each Underwriter as follows:
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(d) Amendments
and Supplements to the Registration Statement, Prospectus and Other Securities
Act Matters. If, during the Prospectus Delivery Period,
any event or development shall occur or condition exist as a result of which
the
Disclosure Package or the Prospectus as then amended or supplemented would
include any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein in the light of the
circumstances under which they were made, as the case may be, not misleading,
or
if it shall be necessary to amend or supplement the Disclosure Package or the
Prospectus, or to file under the Exchange Act any document incorporated by
reference in the Disclosure Package or the Prospectus, in order to make the
statements therein, in the light of the circumstances under which they were
made, as the case may be, not misleading, or if in the opinion of the
Representative it is otherwise necessary to amend or supplement the Registration
Statement, the Disclosure Package or the Prospectus, or to file under the
Exchange Act any document incorporated by reference in the Disclosure Package
or
the Prospectus, or to file a new registration statement containing the
Prospectus, in order to comply with law, including in connection with the
delivery of the Prospectus, the Company agrees to (i) notify the Representative
of any such event or condition (unless such event or condition was previously
brought to the Company’s attention by the Representative during the Prospectus
Delivery Period) and (ii) promptly prepare (subject to Section 3(a) and 3(e)
hereof), file with the Commission (and use its best efforts to have any
amendment to the Registration Statement or any new registration statement to
be
declared effective) and furnish at its own expense to the Underwriters and
to
dealers, amendments or supplements to the Registration Statement, the Disclosure
Package or the Prospectus, or any new registration statement, necessary in
order
to make the statements in the Disclosure Package or the Prospectus as so amended
or supplemented, in the light of the circumstances under which they were made,
as the case may be, not misleading or so that the Registration Statement, the
Disclosure Package or the Prospectus, as amended or supplemented, will comply
with law.
(e) Permitted
Free Writing Prospectuses. The Company represents that it has
not made, and agrees that, unless it obtains the prior written consent of the
Representative, it will not make, any offer relating to the Units that would
constitute an Issuer Free Writing Prospectus or that would otherwise constitute
a “free writing prospectus” (as defined in Rule 405 of the Securities
Act) required to be filed by the Company with the Commission or retained by
the
Company under Rule 433 of the Securities Act; provided that the prior written
consent of the Representative hereto shall be deemed to have been given in
respect of the Free Writing Prospectuses included in Schedule B
hereto. Any such free writing prospectus consented to by the
Representative is hereinafter referred to as a “Permitted Free Writing
Prospectus”. The Company agrees that (i) it has treated and will
treat, as the case may be, each Permitted Free Writing Prospectus as an Issuer
Free Writing Prospectus, and (ii) has complied and will comply, as the case
may
be, with the requirements of Rules 164 and 433 of the Securities Act applicable
to any Permitted Free Writing Prospectus, including in respect of timely filing
with the Commission, legending and record keeping.
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(f) Copies
of any Amendments and Supplements to the
Prospectus. The Company agrees to furnish the
Representative, without charge, during the Prospectus Delivery Period, as many
copies of each of the preliminary prospectus, the Prospectus and the Disclosure
Package and any amendments and supplements thereto (including any documents
incorporated or deemed incorporated by reference therein) as the Representative
may reasonably request.
(g) Blue
Sky Compliance. The Company shall cooperate with the
Representative and counsel for the Underwriters to qualify or register the
Units
for sale under (or obtain exemptions from the application of) the state
securities or blue sky laws of those jurisdictions designated by the
Representative, shall comply with such laws and shall continue such
qualifications, registrations and exemptions in effect so long as required
for
the distribution of the Units. The Company shall not be required to
qualify as a foreign corporation or to take any action that would subject it
to
general service of process in any such jurisdiction where it is not presently
qualified or where it would be subject to taxation as a foreign
corporation. The Company will advise the Representative promptly of
the suspension of the qualification or registration of (or any such exemption
relating to) the Units for offering, sale or trading in any jurisdiction or
any
initiation or threat of any proceeding for any such purpose, and in the event
of
the issuance of any order suspending such qualification, registration or
exemption, the Company shall use its best efforts to obtain the withdrawal
thereof at the earliest possible moment.
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(n) Agreement
Not to Offer or Sell Additional Securities. During
the period commencing on the date hereof and ending on the 365th day following
the
date of the Prospectus, the Company will not, without the prior written consent
of the Representative (which consent may be withheld at the Representative’s
sole discretion), directly or indirectly, sell, offer, contract or grant any
option to sell, pledge, transfer or establish an open “put equivalent
position” within the meaning of Rule 16a-1(h) under the Exchange Act, or
otherwise dispose of or transfer, or announce the offering of, or file any
registration statement under the Securities Act (except as contemplated by
the
Prospectus) in respect of, any shares of Common Stock, options or warrants
to
acquire shares of the Common Stock or securities exchangeable or exercisable
for
or convertible into shares of Common Stock (other than as contemplated by this
Agreement with respect to the Units); provided, however, that the Company may
issue shares of its Common Stock or options to purchase its Common Stock, or
shares of Common Stock upon exercise of options, in each case, pursuant to
any
stock option, stock bonus or other stock plan, arrangement or contractual
obligation described in the Prospectus, but only if the holders of such shares,
options, or shares issued upon exercise of such options, agree in writing not
to
sell, offer, dispose of or otherwise transfer any such shares or options during
such 365-day period without the prior written consent of the Representative
(which consent may be withheld at the Representative’s sole
discretion).
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(p) Future
Reports to the Representative. During the period of
five years hereafter the Company will furnish, if not otherwise available on
XXXXX, to the Representative at 000 XX Xxxxx Xxxxxxx, Xxxxxxxx, Xxxxxx 00000
Attention: Syndicate Department: (i) as soon as
practicable after the end of each fiscal year, copies of the Annual Report
of
the Company containing the balance sheet of the Company as of the close of
such
fiscal year and statements of income, stockholders’ equity and cash flows for
the year then ended and the opinion thereon of the Company’s independent public
or certified public accountants; (ii) as soon as practicable after the filing
thereof, copies of each proxy statement, Annual Report on Form 10-K, Quarterly
Report on Form 10-Q, Current Report on Form 8-K or other report filed by the
Company with the Commission, the FINRA or any securities exchange; and (iii)
as
soon as available, copies of any report or communication of the Company mailed
generally to holders of its capital stock.
(a) The
Representative shall be entitled to reimbursement from the Company, for itself
alone and not as Representative of the Underwriters, to a non-accountable
expense allowance equal to 3% of the aggregate initial public offering price
of
the Firm Units. The Representative shall be entitled to withhold this
allowance on the Closing Date related to the purchase of the Firm Units or
the
Option Units, as the case may be.
(b) In
addition to the payment described in Paragraph (a) of this Section 4, the
Company agrees to pay all costs, fees and expenses incurred in connection with
the performance of their obligations hereunder and in connection with the
transactions contemplated hereby, including without limitation (i) all expenses
incident to the issuance and delivery of the Units (including all printing
and
engraving costs, if any), (ii) all fees and expenses of the registrar and
transfer agent of the Common Stock, (iii) all necessary issue, transfer and
other stamp taxes in connection with the issuance and sale of the Units to
the
Underwriters, (iv) all fees and expenses of the Company’s counsel, independent
public or certified public accountants and other advisors, (v) all costs and
expenses incurred in connection with the preparation, printing, filing, shipping
and distribution of the Registration Statement (including financial statements,
exhibits, schedules, consents and certificates of experts), each Issuer Free
Writing Prospectus, each preliminary prospectus and the Prospectus, and all
amendments and supplements thereto, and
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this
Agreement, (vi) all filing fees, attorneys’ fees and expenses incurred by the
Company or the Underwriters in connection with qualifying or registering (or
obtaining exemptions from the qualification or registration of) all or any
part
of the Units for offer and sale under the state securities or blue sky laws,
and, if requested by the Representative, preparing and printing a “Blue Sky
Survey” or memorandum, and any supplements thereto, advising the Underwriters of
such qualifications, registrations and exemptions, (vii) the filing fees
incident to the FINRA’s review and approval of the Underwriters’ participation
in the offering and distribution of the Units, (viii) the fees and expenses
associated with including the Units on the Nasdaq Capital Market, (ix) all
other
fees, costs and expenses referred to in Item 25 of Part II of the Registration
Statement,and (x) all reasonable out-of-pocket costs and expenses of the
Underwriters. Except as provided in this Section 4, Section 6,
Section 8 and Section 9 hereof, the Underwriters shall pay their own expenses,
including the fees and disbursements of their counsel.
SECTION
5. Conditions of the Obligations of the
Underwriters. The obligations of the several
Underwriters to purchase and pay for the Firm Units as provided herein on the
First Closing Date and, with respect to the Optional Units, each Subsequent
Closing Date, shall be subject to (1) the accuracy of the representations and
warranties on the part of the Company set forth in Section 1 hereof as of the
date hereof and as of the First Closing Date and each Subsequent Closing Date
as
though then made; (2) the timely performance by the Company of its covenants
and
other obligations hereunder; and (3) each of the following additional
conditions:
(a) Accountants’
Comfort Letter. On the date hereof, the Representative
shall have received from Reeves, Evans, XxXxxxx & Zhang, LLP, independent
registered public accounting firm of the Company, a letter dated the date hereof
addressed to the Underwriters, in form and substance satisfactory to the
Representative, containing statements and information of the type ordinarily
included in accountant’s “comfort letters” to underwriters, delivered according
to Statement of Auditing Standards No. 72 (or any successor bulletin), with
respect to the audited and unaudited financial statements and certain financial
information contained in the Registration Statement and the Prospectus (and
the
Representative shall have received an additional four conformed copies of such
accountants’ letter for the several Underwriters).
(b) Effectiveness
of Registration Statement; Compliance with Registration Requirements; No Stop
Order. For the period from and after effectiveness of
this Agreement and prior to the First Closing Date and, with respect to the
Optional Units, any Subsequent Closing Date:
(i) the
Company shall have filed the Prospectus with the Commission (including the
information required by Rule 430A under the Securities Act) in the manner and
within the time period required by Rule 424(b) under the Securities Act; or
the
Company shall have filed a post-effective amendment to the Registration
Statement containing the information required by such Rule 430A, and such
post-effective amendment shall have become effective; and
(ii) no
stop order suspending the effectiveness of the Registration Statement, or any
post-effective amendment to the Registration Statement, shall be in effect
and
no
proceedings for such purpose shall have been instituted or threatened by the
Commission.
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(i) for
the period from and after the date of this Agreement and prior to such Closing
Date, there has not occurred any Material Adverse Change;
(ii) the
representations, warranties and covenants of the Company set forth in Section
1
of this Agreement are true and correct with the same force and effect as though
expressly made on and as of such Closing Date; and
(iii) the
Company has complied with all the agreements hereunder and satisfied all the
conditions on its part to be performed or satisfied hereunder at or prior to
such Closing Date.
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Section
5, except that the specified date referred to therein for the carrying out
of
procedures shall be no more than three business days prior to the First Closing
Date or Subsequent Closing Date, as the case may be (and the Representative
shall have received an additional four conformed copies of such accountants’
letter the several Underwriters).
(h) Lock-Up
Agreement from Certain Securityholders of the
Company. On or prior to the date hereof, the Company
shall have furnished to the Representative an agreement in the form of Exhibit
B
hereto from each [officer, director and more than 5%] stockholder of the
Company, and such agreement shall be in full force and effect on each of the
First Closing Date and each Subsequent Closing Date.
(i) Additional
Documents. On or before each of the First Closing Date
and each Subsequent Closing Date, the Representative and counsel for the
Underwriters shall have received such information, documents and opinions as
they may reasonably require for the purposes of enabling them to pass upon
the
issuance and sale of the Units as contemplated herein, or in order to evidence
the accuracy of any of the representations and warranties, or the satisfaction
of any of the conditions or agreements, herein contained.
If
any
condition specified in this Section 5 is not satisfied when and as required
to
be satisfied, this Agreement may be terminated by the Representative by notice
to the Company at any time on or prior to the First Closing Date and, with
respect to the Optional Units, at any time prior to each Subsequent Closing
Date, which termination shall be without liability on the part of any party
to
any other party, except that Section 4, Section 6, Section 8 and Section 9
shall
at all times be effective and shall survive such termination.
Prior
to
such effectiveness, this Agreement may be terminated by any party by notice
to
each of the other parties hereto, and any such termination shall be without
liability on the part of (a) the Company to any Underwriter, except that (solely
in the case where the Company has
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terminated
this Agreement pursuant to this Section 7) the Company shall be obligated to
reimburse the expenses of the Representative and the Underwriters pursuant
to
Sections 4 and 6 hereof, or (b) any Underwriter to the Company except that
the
provisions of Section 8 and Section 9 shall at all times be effective and shall
survive such termination.
(a) Indemnification
of the Underwriters.
(1) The
Company agrees to indemnify and hold harmless each Underwriter, its officers
and
employees, and each person, if any, who controls any Underwriter within the
meaning of the Securities Act and the Exchange Act against any loss, claim,
damage, liability or expense, as incurred, to which such Underwriter or such
controlling person may become subject, under the Securities Act, the Exchange
Act or other federal or state statutory law or regulation, or at common law
or
otherwise (including in settlement of any litigation, if such settlement is
effected with the written consent of the Company), insofar as such loss, claim,
damage, liability or expense (or actions in respect thereof as contemplated
below) arises out of or is based (i) upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement, or any
amendment thereto, including any information deemed to be a part thereof
pursuant to Rule 430A, Rule 430B and Rule 430C under the Securities Act, or
the
omission or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading; or (ii)
upon
any untrue statement or alleged untrue statement of a material fact contained
in
any Issuer Free Writing Prospectus, any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
or
(iii) in whole or in part upon any inaccuracy in the representations and
warranties of the Company contained herein; or (iv) in whole or in part upon
any
failure of the Company to perform its obligations hereunder or under law; or
(v)
upon 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 Common 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 any matter covered by clause (i) or (ii) above, provided that the
Company shall not be liable under this clause (v) to the extent that a court
of
competent jurisdiction shall have determined by a final judgment that such
loss,
claim, damage, liability or action resulted directly from any such acts or
failures to act undertaken or omitted to be taken by such Underwriter through
its bad faith or willful misconduct; and to reimburse each Underwriter and
each
such controlling person for any and all expenses (including the fees and
disbursements of counsel chosen by the Representative) as such expenses are
reasonably incurred by such Underwriter or such controlling person in connection
with investigating, defending, settling, compromising or paying any such loss,
claim, damage, liability, expense or action; provided, however,
that the foregoing indemnity agreement shall not apply to any loss, claim,
damage, liability or expense to the extent, but only to the extent, arising
out
of or based upon any untrue statement or alleged untrue statement or omission
or
alleged omission made in reliance upon and in conformity with written
information furnished to the Company by the Representative expressly for use
in
the Registration Statement, any Issuer Free Writing Prospectus, any preliminary
prospectus or the Prospectus (or any amendment or
21
supplement
thereto). The indemnity agreement set forth in this Section 8(a)(1) shall be
in
addition to any liabilities that the Company may otherwise have.
(b) Indemnification
of the Company, its Directors and Officers. Each
Underwriter agrees, severally and not jointly, to indemnify and hold harmless
the Company, each of its directors, each of its officers who signed the
Registration Statement and each person, if any, who controls the Company within
the meaning of the Securities Act or the Exchange Act, against any loss, claim,
damage, liability or expense, as incurred, to which the Company, or any such
director, officer, or controlling person may become subject, under the
Securities Act, the Exchange Act, or other federal or state statutory law or
regulation, or at common law or otherwise (including in settlement of any
litigation, if such settlement is effected with the written consent of such
Underwriter), insofar as such loss, claim, damage, liability or expense (or
actions in respect thereof as contemplated below) arises out of or is based
upon
any untrue or alleged untrue statement of a material fact contained in the
Registration Statement, any Issuer Free Writing Prospectus, any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto), or arises
out of or is based upon 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, in each case to the extent, but only to the extent,
that
such untrue statement or alleged untrue statement or omission or alleged
omission was made in the Registration Statement, any Issuer Free Writing
Prospectus, any preliminary prospectus or the Prospectus (or any amendment
or
supplement thereto), in reliance upon and in conformity with written information
furnished to the Company by the Representative expressly for use therein; and
to
reimburse the Company, or any such director, officer, or controlling person
for
any legal and other expense reasonably incurred by the Company, or any such
director, officer, or controlling person in connection with investigating,
defending, settling, compromising or paying any such loss, claim, damage,
liability, expense or action. The Company hereby acknowledges that
the only information that the Underwriters have furnished to the Company
expressly for use in the Registration Statement, any Issuer Free Writing
Prospectus, any preliminary prospectus or the Prospectus (or any amendment
or
supplement thereto) are the statements set forth in the table in the first
paragraph and in the Section entitled “Stabilization” under the caption
“Underwriting” in the preliminary prospectus and the Prospectus; and the
Underwriters confirm that such statements are correct. The indemnity
agreement set forth in this Section 8(b) shall be in addition to any liabilities
that each Underwriter may otherwise have.
(c) Notifications
and Other Indemnification Procedures. Promptly after
receipt by an indemnified party under this Section 8 of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against an indemnifying party under this Section 8, notify
the indemnifying party in writing of the commencement thereof, but the omission
so to notify the indemnifying party will not relieve it from any liability
which
it may have to any indemnified party for contribution or otherwise than under
the indemnity agreement contained in this Section 8 or to the extent it is
not
prejudiced as a proximate result of such failure. In case any such
action is brought against any indemnified party and such indemnified party
seeks
or intends to seek indemnity from an indemnifying party, the indemnifying party
will be entitled to participate in, and, to the extent that it shall elect,
jointly with all other indemnifying parties similarly notified, by written
notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to
22
assume
the defense thereof with counsel reasonably satisfactory to such indemnified
party; provided, however, if the defendants in any such action include both
the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that a conflict may arise between the positions of
the
indemnifying party and the indemnified party in conducting the defense of any
such action or that there may be legal defenses available to it and/or other
indemnified parties which are different from or additional to those available
to
the indemnifying party, the indemnified party or parties shall have the right
to
select separate counsel to assume such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party
or
parties. Upon receipt of notice from the indemnifying party to such
indemnified party of such indemnifying party’s election so to assume the defense
of such action and approval by the indemnified party of counsel, the
indemnifying party will not be liable to such indemnified party under this
Section 8 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that
the
indemnifying party shall not be liable for the expenses of more than one
separate counsel (together with local counsel), approved by the indemnifying
party (the Representative in the case of Section 8(b) and Section 9),
representing the indemnified parties who are parties to such action) or (ii)
the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of commencement of the action, in each of which cases the fees
and
expenses of counsel shall be at the expense of the indemnifying
party.
(d) Settlements. The
indemnifying party under this Section 8 shall not be liable for any settlement
of any proceeding effected without its written consent, but if settled with
such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party against any loss, claim, damage,
liability or expense by reason of such settlement or
judgment. Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by Section
8(c) hereof, the indemnifying party agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by such indemnifying
party of the aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to the
date of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement,
compromise or consent to the entry of judgment in any pending or threatened
action, suit or proceeding in respect of which any indemnified party is or
could
have been a party and indemnity was or could have been sought hereunder by
such
indemnified party, unless such settlement, compromise or consent includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such action, suit or proceeding.
23
party,
as
incurred, as a result of any losses, claims, damages, liabilities or expenses
referred to therein (i) in such proportion as is appropriate to reflect the
relative benefits received by the indemnifying parties on the one hand, and
the
indemnified parties, on the other hand, from the offering of the Units pursuant
to this Agreement or (ii) if the allocation provided by clause (i) above is
not
permitted by applicable law, in such proportion as is appropriate to reflect
not
only the relative benefits referred to in clause (i) above but also the relative
fault of the indemnifying parties, on the one hand, and the indemnified parties,
on the other hand, in connection with the statements or omissions or
inaccuracies in the representations and warranties herein which resulted in
such
losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the
indemnifying parties, on the one hand, and the indemnified parties, on the
other
hand, in connection with the offering of the Units pursuant to this Agreement
shall be deemed to be in the same respective proportions as the total net
proceeds from the offering of the Units pursuant to this Agreement (before
deducting expenses) received by the indemnifying parties, and the total
underwriting discount received by the indemnified parties, in each case as
set
forth on the front cover page of the Prospectus bear to the aggregate initial
public offering price of the Units as set forth on such cover. The
relative fault of the indemnifying parties, on the one hand, and the indemnified
parties, on the other hand, shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact or any such inaccurate
or alleged inaccurate representation or warranty relates to information supplied
by indemnifying parties, on the one hand, or the indemnified parties, on the
other hand, and the parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The
amount paid or payable by a party as a result of the losses, claims, damages,
liabilities and expenses referred to above shall be deemed to include, subject
to the limitations set forth in Section 8(c), any legal or other fees or
expenses reasonably incurred by such party in connection with investigating
or
defending any action or claim. The provisions set forth in Section
8(c) with respect to notice of commencement of any action shall apply if a
claim
for contribution is to be made under this Section 9; provided, however, that
no
additional notice shall be required with respect to any action for which notice
has been given under Section 8(c) for purposes of indemnification.
The
Company and the Underwriters agree that it would not be just and equitable
if
contribution pursuant to this Section 9 were determined by pro rata allocation
(even if the Underwriters were treated as one entity for such purpose) or by
any
other method of allocation which does not take account of the equitable
considerations referred to in this Section 9.
24
each
person, if any, who controls an Underwriter within the meaning of the Securities
Act and the Exchange Act shall have the same rights to contribution as such
Underwriter; and each director of the Company, each officer of the Company
who
signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of the Securities Act and the Exchange Act shall
have
the same rights to contribution as the Company.
SECTION
10. Default of One or More of the Several
Underwriters. If, on the First Closing Date or each
Subsequent Closing Date, as the case may be, any one or more of the several
Underwriters shall fail or refuse to purchase Units that it or they have agreed
to purchase hereunder on such date, and the aggregate number of Units which
such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
does not exceed 10% of the aggregate number of the Units to be purchased on
such
date, the other Underwriters shall be obligated, severally, in the proportions
that the number of Firm Units set forth opposite their respective names on
Schedule A bears to the aggregate number of Firm Units set forth opposite the
names of all such non-defaulting Underwriters, or in such other proportions
as
may be specified by the Representative with the consent of the non-defaulting
Underwriters, to purchase the Units which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date. If, on
the
First Closing Date or each Subsequent Closing Date, as the case may be, any
one
or more of the Underwriters shall fail or refuse to purchase Units and the
aggregate number of Units with respect to which such default occurs exceeds
10%
of the aggregate number of Units to be purchased on such date, and arrangements
satisfactory to the Representative and the Company for the purchase of such
Units are not made within 48 hours after such default, this Agreement shall
terminate without liability of any party to any other party except that the
provisions of Section 4, Section 6, Section 8 and Section 9 shall at all times
be effective and shall survive such termination. In any such case
either the Representative or the Company shall have the right to postpone the
First Closing Date or each Subsequent Closing Date, as the case may be, but
in
no event for longer than seven days in order that the required changes, if
any,
to the Registration Statement and the Prospectus or any other documents or
arrangements may be effected.
As
used
in this Agreement, the term “Underwriter” shall be deemed to include any
person substituted for a defaulting Underwriter under this Section
10. Any action taken under this Section 10 shall not relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
SECTION
11. Termination of this Agreement. Prior
to the First Closing Date and, with respect to Optional Units, each Subsequent
Closing Date, whether before or after notification by the Commission to the
Company of the effectiveness of the Registration Statement under the Securities
Act, this Agreement may be terminated by the Representative by notice given
to
the Company if at any time (i) trading or quotation in any of the Company’s
securities shall have been suspended or limited by the Commission or by the
Nasdaq Capital Market, or trading in securities generally on either the Nasdaq
Stock Market or the New York Stock Exchange shall have been suspended or
limited, or minimum or maximum prices shall have been generally established
on
any of such stock exchanges by the Commission or the FINRA; (ii) a general
banking moratorium shall have been declared by any of federal, New York or
Nevada authorities; (iii) there shall have occurred any outbreak or escalation
of national or international hostilities or any crisis or calamity, or any
change in the United States or international financial
25
markets,
or any substantial change or development involving a prospective substantial
change in United States’ or international political, financial or economic
conditions that, in the judgment of the Representative is material and adverse
and makes it impracticable to market the Units in the manner and on the terms
described in the Prospectus or to enforce contracts for the sale of securities;
or (iv) in the judgment of the Representative there shall have occurred any
Material Adverse Change (regardless of whether any loss associated with such
Material Adverse Change shall have been insured). Any termination
pursuant to this Section 11 shall be without liability on the part of (a) the
Company to any Underwriter, except that the Company shall be obligated to
reimburse the expenses of the Representative and the Underwriters pursuant
to
Sections 4 and 6 hereof, (b) any Underwriter to the Company, or (c) of any
party
hereto to any other party except that the provisions of Section 8 and Section
9
shall at all times be effective and shall survive such termination.
This
Agreement supersedes all prior agreements and understandings (whether written
or
oral) between the Company and the several Underwriters, or any of them, with
respect to the subject matter hereof.
26
Underwriter
or the Company or any of its or their partners, officers or directors or any
controlling person, as the case may be, and will survive delivery of and payment
for the Units sold hereunder and any termination of this Agreement.
If
to the
Representative:
Xxxxxxx Investment Company, Inc.
000
XX Xxxxx Xxxxxxx, Xxxxx
000
Xxxxxxxx,
XX 00000
Facsimile: (000)
000-0000
Attention: Syndicate
Department
with
a copy to:
Holland
&
Knight
LLP
000
XX Xxxxx Xxxxxx, Xxxxx
0000
Xxxxxxxx,
XX 00000
Facsimile: (000)
000-0000
Attention: Xxxx
X. xxx
Xxxxxx
If
to the
Company:
Healthy
Fast Food, Inc.
0000
Xxxxxxxx Xxxxxxx, Xxxxx X
Xxxxxxxxx,
XX 00000
Facsimile: (000)
000-0000
Attention: Xxxxx
X. Xxxxxxxxxx
with
a copy to:
Xxxx
Xxxx
Xxxx Xxxxxxxxxx & Xxxxxxxxx, P.C.
000
Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx,
XX 00000
Facsimile: (000)
000-0000
Attention: Xxx
X. Xxxxxxxxx
Any
party
hereto may change the address for receipt of communications by giving written
notice to the others.
27
representatives
and no other person will have any right or obligation hereunder. The
term “successors” shall not include any purchaser of the Units as such
from any of the Underwriters merely by reason of such purchase.
SECTION
17. Governing Law
Provisions. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK
APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE.
Each
of
the parties hereto acknowledges that it is a sophisticated business person
who
was adequately represented by counsel during negotiations regarding the
provisions hereof, including, without limitation, the indemnification provisions
of Section 8 and the contribution provisions of Section 9, and is fully informed
regarding said provisions. Each of the parties hereto further
acknowledges that the provisions of Sections 8 and 9 hereto fairly allocate
the
28
risks
in
light of the ability of the parties to investigate the Company, its affairs
and
its business in order to assure that adequate disclosure has been made in the
Registration Statement, any preliminary prospectus and the Prospectus (and
any
amendments and supplements thereto), as required by the Securities Act and
the
Exchange Act.
The
respective indemnities, contribution agreements, representations, warranties
and
other statements of the Company and the several Underwriters set forth in or
made pursuant to this Agreement shall remain operative and in full force and
effect, regardless of (i) any investigation, or statement as to the results
thereof, made by or on behalf of any Underwriter, the officers or employees
of
any Underwriter, any person controlling any Underwriter, the Company, the
officers or employees of the Company, or any person controlling the Company,
(ii) acceptance of the Units and payment for them hereunder and (iii)
termination of this Agreement.
Except
as
otherwise provided, this Agreement has been and is made solely for the benefit
of and shall be binding upon the Company, the Underwriters, the Underwriters’
officers and employees, any controlling persons referred to herein, the
Company’s directors and the Company’s officers who sign the Registration
Statement and their respective successors and assigns, all as and to the
extent provided in this Agreement, and no other person shall acquire
or have any right under or by virtue of this Agreement. The term
“successors and assigns” shall not include a purchaser of any of the
Units from any of the several Underwriters merely because of such purchase.
29
If
the
foregoing is in accordance with your understanding of our agreement, kindly
sign
and return to the Company the enclosed copies hereof, whereupon this instrument,
along with all counterparts hereof, shall become a binding agreement in
accordance with its terms.
Very
truly yours,
HEALTHY
FAST FOOD, INC.
By: _______________________________________
Name: Xxxxx
X.
Xxxxxxxxxx
Title: President
The
foregoing Underwriting Agreement is hereby confirmed and accepted by the
Representative as of the date first above written.
XXXXXXX
INVESTMENT COMPANY, INC.
Acting
as
Representative of the several
Underwriters
named in the attached Schedule A.
By:____________________________________
Name:
Title:
#
4708423_v2
30
SCHEDULE
A
|
Underwriters
|
Number
of Firm Units to be Purchased
|
|
Xxxxxxx
Investment Company, Inc.
|
|
|
|
|
|
Total
|
2,500,000
|
SCH.
A-1
SCHEDULE
B
Issuer
Free Writing Prospectus
SCH.
B-1
Schedule
C
Price
per
Unit to public: $_______
Underwriting
discounts and commissions per Unit: $_______
Offering
proceeds to the Company, before expenses: $_______
Closing
Date: ___________, 2007
SCH.
C-1
EXHIBIT
A
Opinion
of counsel for the Company
to
be
delivered pursuant to Section 5(d) of the Underwriting
Agreement.
References
to the Prospectus in this Exhibit A include any supplements thereto at the
First
Closing Date and, if applicable, each Subsequent Closing
Date. Capitalized terms used and not defined herein shall have the
meanings ascribed to them in the Underwriting Agreement.
(i) The
Company has been duly incorporated and is validly existing as a corporation
in
good standing under the laws of the State of Nevada.
(ii) The
Company has corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Disclosure Package
and the Prospectus and to enter into and perform its obligations under the
Underwriting Agreement.
(iii) The
Company is duly qualified as a foreign corporation to transact business and
is
in good standing in each other jurisdiction in which such qualification is
required, except for such jurisdictions where the failure to so qualify or
to be
in good standing would not, individually or in the aggregate, result in a
Material Adverse Change.
(iv) To
the best of such counsel’s knowledge, the Company does not own an equity
interest in any other entity.
(v) The
authorized, issued and outstanding capital stock of the Company (including
the
Common Stock) conforms to the descriptions thereof set forth in the Disclosure
Package and the Prospectus. All of the outstanding shares of Common
Stock have been duly authorized and validly issued, are fully paid and
nonassessable and, to the best of such counsel’s knowledge, have been issued in
compliance with the registration and qualification requirements of federal
and
state securities laws. The form of certificate used to evidence the
Common Stock complies with all applicable requirements of the charter and
by-laws of the Company and the Nevada Corporation Law of the State of
Nevada. The description of the Company’s stock option, stock bonus
and other stock plans or arrangements, and the options or other rights granted
and exercised thereunder, set forth in the Disclosure Package and the Prospectus
accurately and fairly presents the information required to be shown with respect
to such plans, arrangements, options and rights.
(vi) No
stockholder of the Company or any other person has any preemptive right, right
of first refusal or other similar right to subscribe for or purchase securities
of the Company arising (i) by operation of the charter or by-laws of the Company
or the Nevada Corporation Law of the State of Nevada or (ii) to the best
knowledge of such counsel, otherwise.
(vii) The
Underwriting Agreement has been duly authorized, executed and delivered by
the
Company.
(viii) The
Common Stock included in the Units to be purchased by the Underwriters from
the
Company (including units purchasable on exercise of the Underwriters’
overallotment option and the Representative’s Warrants) has been duly authorized
and reserved for issuance
EX.
A-1
and
sale
pursuant to this Agreement and, in the case of Common Stock issuable on exercise
of the Representative’s Warrants, the terms thereof and, when so issued and
delivered by the Company, will be validly issued, fully paid and
nonassessable. The Class A Warrants and Class B Warrants included in
the Units to be purchased by the Underwriters from the Company have been duly
and validly authorized by all required corporate actions and will, when issued
and delivered by the Company pursuant to this Agreement, be validly executed
and
delivered by, and will be valid and binding agreements of, the Company,
enforceable in accordance with their terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the rights and remedies of creditors
or by
general equitable principles. The Representative’s Warrants have been
duly and validly authorized by all required corporate actions and will, when
issued and delivered by the Company pursuant to this Agreement, be validly
executed and delivered by, and will be valid and binding agreements of, the
Company, enforceable in accordance with their terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, reorganization, moratorium
or
other similar laws relating to or affecting the rights and remedies of creditors
or by general equitable principles. The Common Stock issuable on
exercise of Class A Warrants, Class B Warrants has been duly authorized and
reserved for issuance and sale pursuant to the terms of such warrants and,
when
issued and delivered by the Company pursuant to such warrants, will be validly
issued, fully paid and nonassessable.
(ix) The
Warrant Agreement has been duly authorized by the Company. When duly
executed, authenticated, issued and delivered as contemplated in the
Registration Statement and the Warrant Agreement, the Warrant Agreement will
constitute the legally binding agreement of the Company, enforceable against
it
in accordance with its terms, except as the enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by general
equitable principles.
(ix) The
Registration Statement and the Rule 462(b) Registration Statement, if any,
has
been declared effective by the Commission under the Securities
Act. To the best knowledge of such counsel, no stop order suspending
the effectiveness of either of the Registration Statement or the Rule 462(b)
Registration Statement, if any, has been issued under the Securities Act and
no
proceedings for such purpose have been instituted or are pending or are
contemplated or threatened by the Commission. Any required filing of
the Disclosure Package and the Prospectus and any supplement thereto pursuant
to
Rule 424(b) under the Securities Act has been made in the manner and within
the
time period required by such Rule 424(b).
(x) The
Registration Statement, including any Rule 462(b) Registration Statement, the
Prospectus, and each amendment or supplement to the Registration Statement
and
the Prospectus, and each document deemed to be part of the Disclosure Package,
as of their respective effective or issue dates (other than the financial
statements and supporting schedules included therein or in exhibits to or
excluded from the Registration Statement, as to which no opinion need be
rendered) comply as to form in all material respects with the applicable
requirements of the Securities Act.
EX.
A-2
(xi) The
Units, the Common Stock, the Class A Warrants and the Class B Warrants have
been
approved for quotation on the Nasdaq Capital Market under the symbols “_______,”
“_______,” “_______” and “_______,” respectively.
(xiv) The
statements (i) in each of the Disclosure Package and the Prospectus under the
captions “Related Party Transactions”, “Description of Securities” and “Shares
Eligible for Future Sale”, (ii) under the caption “Indemnification of Officers
and Directors” in Item 24 of the Registration Statement, (iii) under the caption
“Recent Sales of Unregistered Securities in Item 26 of the Registration
Statement, insofar as such statements constitute matters of law, legal
conclusions or summaries of legal matters or documents or the Company’s charter
or by-law provisions, have been reviewed by such counsel and fairly present
and
summarize, in all material respects, the matters referred to
therein.
(xv) To
the best knowledge of such counsel, there are no legal or governmental actions,
suits or proceedings pending or threatened which are required to be disclosed
in
the Registration Statement or the Disclosure Package, other than those disclosed
therein.
(xvi) To
the best knowledge of such counsel, there are no Existing Instruments required
to be described or referred to in the Registration Statement or to be filed
as
exhibits thereto other than those described or referred to therein or filed
as
exhibits thereto; and the descriptions thereof and references thereto are
correct in all material respects.
(xvii) No
consent, approval, authorization or other order of, or registration or filing
with, any court or other governmental authority or agency, is required for
the
Company’s execution, delivery and performance of the Underwriting Agreement and
consummation of the transactions contemplated thereby and by the Prospectus,
except as required under the Securities Act, the applicable laws of any foreign
jurisdiction, applicable state securities or blue sky laws and from the
FINRA.
(xviii) The
execution and delivery of the Underwriting Agreement by the Company and the
performance by the Company of its obligations thereunder (other than performance
by the Company of its obligations under the indemnification section of the
Underwriting Agreement, as to which no opinion need be rendered) (i) have been
duly authorized by all necessary corporate action on the part of the Company;
(ii) will not result in any violation of the provisions of the charter or
by-laws of the Company; (iii) will not (A) constitute a breach of, or Default
under any Existing Instrument, or (B) result in the creation or imposition
of
any lien, charge or encumbrance upon any property or assets of the Company
pursuant to, in the case of each of clauses (A) and (B), any Existing Instrument
filed as an exhibit to the Registration Statement or, to the best knowledge
of
such counsel, any other material Existing Instrument; or (iv) to the best
knowledge of such counsel, will not result in any violation of any law,
administrative regulation or administrative or court decree applicable to the
Company.
(xix) The
Company is not, and after receipt of payment for the Units and the application
of the proceeds thereof as contemplated under the caption “Use of Proceeds” in
the Prospectus and in the Disclosure Package will not be, an “investment
company” within the meaning of Investment Company Act.
EX.
A-3
(xx) To
the best knowledge of such counsel, there are no persons with registration
or
other similar rights to have any equity or debt securities registered for sale
under the Registration Statement or included in the offering contemplated by
the
Underwriting Agreement, except for such rights as have been duly
waived.
(xxi) To
the best knowledge of such counsel, the Company is not in violation of its
charter or by-laws or any law, administrative regulation or administrative
or
court decree applicable to the Company or is in Default in the performance
or
observance of any obligation, agreement, covenant or condition contained in
any
material Existing Instrument, except in each such case for such violations
or
Defaults as would not, individually or in the aggregate, result in a Material
Adverse Change.
In
addition, such counsel shall state that they have participated in conferences
with officers and other representatives of the Company, representatives of
the
independent public or certified public accountants for the Company and with
representatives of the Underwriters at which the contents of the Registration
Statement and the Prospectus, and any supplements or amendments thereto, and
related matters were discussed and, although such counsel is not passing upon
and does not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement or the
Prospectus, including the documents incorporated by reference therein (other
than as specified above), and any supplements or amendments thereto, on the
basis of the foregoing, nothing has come to their attention which has caused
them to believe that (i) either the Registration Statement or any amendments
thereto, at the time the Registration Statement or such amendments became
effective, contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading; (ii) the Prospectus, as of its date or at
the
First Closing Date or each Subsequent Closing Date, as the case may be,
contained an untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; or (iii) the items
specified in Schedule I, consisting of those included in the Disclosure Package,
contained any untrue statement of a material fact or omitted to state any
material fact necessary in order to make the statements therein, in the light
of
circumstances under which they were made, not misleading (it being understood
that such counsel need express no belief as to the financial statements or
schedules or other financial data derived therefrom, included or incorporated
by
reference in the Registration Statement or the Prospectus or any amendments
or
supplements thereto).
In
rendering such opinion, such counsel may rely (A) as to matters involving the
application of laws of any jurisdiction other than the Nevada Corporation Law
of
the State of Nevada, or the federal law of the United States, to the extent
they
deem proper and specified in such opinion, upon the opinion (which shall be
dated the First Closing Date or each Subsequent Closing Date, as the case may
be, shall be satisfactory in form and substance to the Underwriters, shall
expressly state that the Underwriters may rely on such opinion as if it were
addressed to them and shall be furnished to the Representative) of other counsel
of good standing whom they believe to be reliable and who are satisfactory
to
counsel for the Underwriters; provided, however, that such counsel shall further
state that they believe that they and the Underwriters are justified
in relying upon such opinion of other counsel, and (B) as to matters of fact,
to
the extent they deem proper, on certificates of responsible officers of the
Company and public officials.
EX.
A-4
Exhibit
B
Form
of Lock-Up Agreement
EX.
B-1