9,000,000 Shares
INTEGRATED CIRCUIT SYSTEMS, INC.
Common Stock, Par Value $.01 Per Share
UNDERWRITING AGREEMENT
----------------------
May [24], 2001
XXXXXX BROTHERS INC.,
X.X. XXXXXX SECURITIES INC.,
XXXXXXXXX XXXXXXXX, INC.,
BEAR, XXXXXXX & CO. INC. and
PMG CAPITAL
As Representatives of the Several Underwriters,
c/x Xxxxxx Brothers Inc.
Three World Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
1. Introductory. The selling shareholders of Integrated Circuit Systems,
Inc., a Pennsylvania corporation ("Company"), listed in Schedule A hereto (the
"Selling Shareholders") propose severally to sell an aggregate of 9,000,000
shares of the Company's Common Stock, par value $.01 per share ("Securities")
(such 9,000,000 shares of Securities being hereinafter referred to as the "Firm
Securities") and some of the Selling Shareholders propose severally and not
jointly to sell to the Underwriters, at the option of the Underwriters, an
aggregate of not more than 1,350,000 additional outstanding shares of the
Securities (such 1,350,000 additional shares being hereinafter referred to as
the "Optional Securities"). The Firm Securities and the Optional Securities are
herein collectively called the "Offered Securities." The Company and the Selling
Shareholders hereby agree with the several Underwriters named in Schedule B
hereto ("Underwriters") as follows:
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2. Representations and Warranties of the Company and the Selling Shareholders.
(1) The Company represents and warrants to, and agrees with, the several
Underwriters that:
(1) A registration statement (No. 333-60692) on Form S-3 relating to
the Offered Securities, including a form of prospectus, has been filed with
the Securities and Exchange Commission ("Commission") and either (A) has
been declared effective under the Securities Act of 1933, as amended
("Act") and is not proposed to be amended or (B) is proposed to be amended
by amendment or post-effective amendment. The Company and the transaction
contemplated by this Agreement meet the requirements for using Form S-3
under the Act. If such registration statement (the "initial registration
statement") has been declared effective, either (A) an additional
registration statement (the "additional registration statement") relating
to the Offered Securities may have been filed with the Commission pursuant
to Rule 462(b) ("Rule 462(b)") under the Act and, if so filed, has become
effective upon filing pursuant to such Rule and the Offered Securities all
have been duly registered under the Act pursuant to the initial
registration statement and, if applicable, the additional registration
statement or (B) such an additional registration statement is proposed to
be filed with the Commission pursuant to Rule 462(b) and will become
effective upon filing pursuant to such Rule and upon such filing the
Offered Securities will all have been duly registered under the Act
pursuant to the initial registration statement and such additional
registration statement. If the Company does not propose to amend the
initial registration statement or if an additional registration statement
has been filed and the Company does not propose to amend it, and if any
post-effective amendment to either such registration statement has been
filed with the Commission prior to the execution and delivery of this
Agreement, the most recent amendment (if any) to each such registration
statement has been declared effective by the Commission or has become
effective upon filing pursuant to Rule 462(c) ("Rule 462(c)") under the Act
or, in the case of the additional registration statement, Rule 462(b). For
purposes of this Agreement, "Effective Time" with respect to the initial
registration statement or, if filed prior to the execution and delivery of
this Agreement, the additional registration statement, means (A) if the
Company has advised the Representatives that it does not propose to amend
such registration statement, the date and time as of which such
registration statement, or the most recent post-effective amendment thereto
(if any) filed prior to the execution and delivery of this Agreement, was
declared effective by the Commission or has become effective upon filing
pursuant to Rule 462(c), or (B) if the Company has advised the
Representatives that it proposes to file an amendment or post-effective
amendment to such registration statement, the date and time as
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of which such registration statement, as amended by such amendment or
post-effective amendment, as the case may be, is declared effective by the
Commission. If an additional registration statement has not been filed
prior to the execution and delivery of this Agreement but the Company has
advised the Representatives that it proposes to file one, "Effective Time"
with respect to such additional registration statement means the date and
time as of which such registration statement is filed and becomes effective
pursuant to Rule 462(b). "Effective Date" with respect to the initial
registration statement or the additional registration statement (if any)
means the date of the Effective Time thereof. The initial registration
statement, as amended at its Effective Time, including all material
incorporated by reference therein and all information contained in the
additional registration statement (if any) and deemed to be a part of the
initial registration statement as of the Effective Time of the additional
registration statement pursuant to the General Instructions of the Form on
which it is filed and including all information (if any) deemed to be a
part of the initial registration statement as of its Effective Time
pursuant to Rule 430A(b) ("Rule 430A(b)") under the Act, is hereinafter
referred to as the "Initial Registration Statement". The additional
registration statement, as amended at its Effective Time, including the
contents of the initial registration statement incorporated by reference
therein and including all information (if any) deemed to be a part of the
additional registration statement as of its Effective Time pursuant to Rule
430A(b), is hereinafter referred to as the "Additional Registration
Statement". The Initial Registration Statement and the Additional
Registration Statement are hereinafter referred to collectively as the
"Registration Statements" and individually as a "Registration Statement".
The form of prospectus relating to the Offered Securities, as first filed
with the Commission pursuant to and in accordance with Rule 424(b) ("Rule
424(b)") under the Act or (if no such filing is required) as included in a
Registration Statement, including all material incorporated by reference in
such prospectus is hereinafter referred to as the "Prospectus". No document
has been or will be prepared or distributed in reliance on Rule 434 under
the Act.
(2) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement: (A) on the Effective
Date of the Initial Registration Statement, the Initial Registration
Statement conformed in all material respects to the requirements of the Act
and the rules and regulations of the Commission ("Rules and Regulations")
and did not include 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, (B) on the Effective Date of the
Additional Registration Statement (if any), each Registration Statement
conformed or will conform, in all material respects to the requirements of
the Act
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and the Rules and Regulations and did not include, or will not include, any
untrue statement of a material fact and did not omit, or will not omit, to
state any material fact required to be stated therein or necessary to make
the statements therein not misleading, and (C) on the date of this
Agreement, the Initial Registration Statement and, if the Effective Time of
the Additional Registration Statement is prior to the execution and
delivery of this Agreement, the Additional Registration Statement each
conforms, and at the time of filing of the Prospectus pursuant to Rule
424(b) or (if no such filing is required) at the Effective Date of the
Additional Registration Statement in which the Prospectus is included, each
Registration Statement and the Prospectus will conform, in all material
respects to the requirements of the Act and the Rules and Regulations, and
neither of such documents includes, or will include, any untrue statement
of a material fact or omits, or will omit, to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading. If the Effective Time of the Initial Registration Statement
is subsequent to the execution and delivery of this Agreement: on the
Effective Date of the Initial Registration Statement, the Initial
Registration Statement and the Prospectus will conform in all material
respects to the requirements of the Act and the Rules and Regulations,
neither of such documents will include any untrue statement of a material
fact or will omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, and no
Additional Registration Statement has been or will be filed. The two
preceding sentences do not apply to statements in or omissions from a
Registration Statement or the Prospectus based upon written information
furnished to the Company by any Underwriter through the Representatives
specifically for use therein, it being understood and agreed that the only
such information is that described as such in Section 7(c) hereof.
(3) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the Commonwealth of
Pennsylvania, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus; and the
Company is duly qualified to do business as a foreign corporation in good
standing in all other jurisdictions in which its ownership or lease of
property or the conduct of its business requires such qualification, except
where the failure to be so qualified and in good standing would not
reasonably be expected to individually or in the aggregate (x) result in a
material adverse effect on the properties, business, results of operations,
condition (financial or other), affairs or prospects of the Company and its
subsidiaries taken as a whole, (y) interfere with or adversely affect the
issuance or marketability of the Offered Securities or (z) in any manner
draw into question the validity of this Agreement (any of the events set
forth in clauses (x), (y) or (z), a "Material Adverse Effect").
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(4) Each subsidiary of the Company that (A) generates 5% or more of
the revenues, (B) generates 5% or more of the operating income or (C) holds
5% or more of the assets, in each case, of the Company and its subsidiaries
on a consolidated basis as reflected in the financial statements included
in the Prospectus under the heading "Selected Historical Consolidated
Financial Data" (each, a "Significant Subsidiary") of the Company has been
duly incorporated and is an existing corporation in good standing under the
laws of the jurisdiction of its incorporation, with power and authority
(corporate and other) to own its properties and conduct its business as
described in the Prospectus; and each Significant Subsidiary of the Company
is duly qualified to do business as a foreign corporation in good standing
in all other jurisdictions in which its ownership or lease of property or
the conduct of its business requires such qualification, except where the
failure to be so qualified and in good standing could not reasonably be
expected, individually or in the aggregate, to have a Material Adverse
Effect; all of the issued and outstanding capital stock of the Company and
of each Significant Subsidiary has been duly authorized and validly issued
and is fully paid and nonassessable; and the capital stock of each
Significant Subsidiary owned by the Company, directly or through
subsidiaries, is owned free from liens, encumbrances and defects.
(5) As of March 31, 2001, the Company had an authorized
capitalization as set forth in the Prospectus under the heading
"Capitalization" and all of the Offered Securities and all other
outstanding shares of capital stock of the Company have been duly
authorized by all necessary corporate action and validly issued, fully paid
and nonassessable and conform to the description thereof contained in the
Prospectus; and the shareholders of the Company have no preemptive rights
with respect to the Securities.
(6) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person that would
give rise to a valid claim against the Company or any Underwriter for a
brokerage commission, finder's fee or other like payment in connection with
this offering.
(7) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person granting
such person the right to require the Company to file a registration
statement under the Act with respect to any securities of the Company owned
or to be owned by such person or to require the Company to include such
securities in the securities registered pursuant to a Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Act,
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and to the extent any such rights are applicable in respect of a
Registration Statement, such rights have been fully satisfied or waived in
accordance with their terms.
(8) The Securities are traded on The Nasdaq Stock Market's National
Market (the "Nasdaq National Market").
(9) No consent, approval, authorization, or order of, or filing with,
any governmental agency or body or any court or other person is required to
be obtained or made by the Company for the execution and delivery of this
Agreement and consummation of the transactions contemplated by this
Agreement in connection with the sale of the Offered Securities except such
as have been obtained and made under the Act and such as may be required
under state securities or "Blue Sky" laws.
(10) The execution, delivery and performance of this Agreement, and
the consummation of the transactions herein contemplated will not result in
a breach or violation of any of the terms and provisions of, or constitute
a default under, (A) any statute, any rule, regulation or order of any
governmental agency or body or any court, domestic or foreign, having
jurisdiction over the Company or any subsidiary of the Company or any of
their properties, (B) any 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 properties of the Company or
any of its subsidiaries is subject or (C) the charter or by-laws of the
Company or any of its subsidiaries, except (1) in each case, that any
rights to indemnity and contribution may be limited by federal and state
securities laws and public policy considerations and (2) in the case of
clauses (A) and (B) for such breaches, violations or defaults as would not
reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect; and the Company has full corporate power and
authority to execute, deliver and perform this Agreement.
(11) This Agreement has been duly authorized, executed and delivered
by the Company.
(12) Except as disclosed in the Prospectus, the Company and its
subsidiaries have good and marketable title to all real properties and all
other properties and assets owned by them that are material to the Company
and its subsidiaries taken as a whole, in each case free from liens,
encumbrances and defects that would materially affect the value thereof or
materially interfere with the use made or proposed to be made thereof by
them; and except as disclosed in the Prospectus, the Company and its
subsidiaries hold any leased real or personal property that is
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material to the Company and its subsidiaries taken as a whole under valid
and enforceable leases with no exceptions that would materially interfere
with the use made or proposed to be made thereof by them.
(13) The Company and its subsidiaries possess all certificates,
authorities or permits issued by appropriate governmental agencies or
bodies necessary to conduct the business now operated by them and have not
received any notice of proceedings relating to the revocation or
modification of any such certificate, authority or permit that, if
determined adversely to the Company or any of its subsidiaries, would
reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect.
(14) No labor strike, slowdown, stoppage or dispute with the employees
of the Company or any of its subsidiaries exists or, to the knowledge of
the Company, is imminent that would reasonably be expected, individually or
in the aggregate, to have a Material Adverse Effect. None of the Company or
any of its subsidiaries has violated (A) any federal, state or local law or
foreign law relating to discrimination in hiring, promotion or payment of
employees, (B) any applicable wage or hour laws, or (C) any provision of
the Employee Retirement Income Security Act of 1974, as amended, or the
rules and regulations thereunder, except those violations that could not
reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect.
(15) The Company and its subsidiaries own, possess, have the right to
use or can acquire on reasonable terms, adequate trademarks, trade names
and other rights to inventions, know-how, patents, copyrights, confidential
information and other intellectual property (collectively, "intellectual
property rights") used in the conduct the business now operated by them, or
presently employed by them, and have not received any notice of
infringement of or conflict with asserted rights of others with respect to
any intellectual property rights that, if determined adversely to the
Company or any of its subsidiaries, would reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect. To the
knowledge of the Company after due inquiry, the use of the intellectual
property rights in connection with the business and operations of the
Company or any of its subsidiaries does not infringe on the rights of any
person, except such infringements as would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect.
(16) Neither the Company nor any of its subsidiaries (A) is in
violation of any statute, any rule, regulation, decision or order of any
governmental agency or body or any court, domestic or foreign, relating to
the use, disposal or release of
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hazardous or toxic substances or relating to the protection or restoration
of the environment or human exposure to hazardous or toxic substances
(collectively, "environmental laws"), (B) owns or operates any real
property contaminated with any substance that is subject to any
environmental laws, (C) is liable for any off-site disposal or
contamination pursuant to any environmental laws, or (D) is subject to any
claim relating to any environmental laws, in each case, which violation,
contamination, liability or claim would reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect; and
the Company is not aware of any pending investigation which might lead to
such a claim.
(17) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Company, any of its
subsidiaries or any of their respective properties that, if determined
adversely to the Company or any of its subsidiaries, would reasonably be
expected, individually or in the aggregate, to have a Material Adverse
Effect, or would materially and adversely affect the ability of the Company
to perform its obligations under this Agreement, or which are otherwise
material in the context of the sale of the Offered Securities; and no such
actions, suits or proceedings are, to the Company's knowledge, threatened
or contemplated.
(18) The financial statements included in each Registration Statement
and the Prospectus present fairly the financial position of the Company and
its consolidated subsidiaries as of the dates shown (subject in the case of
interim financial statements to the normal year-end adjustments) and their
results of operations and cash flows for the periods shown, and such
financial statements have been prepared in conformity with the generally
accepted accounting principles in the United States applied on a consistent
basis and the schedules included in each Registration Statement present
fairly the information required to be stated therein.
(19) Except as disclosed in the Prospectus, since the date of the
latest audited financial statements included in the Prospectus (A) there
has been no material adverse change, nor any development or event involving
a prospective material adverse change in the properties, business, results
of operations, condition (financial or other), affairs or prospects of the
Company and its subsidiaries taken as a whole, (B) except as disclosed in
or contemplated by the Prospectus, there has been no dividend or
distribution of any kind declared, paid or made by the Company on any class
of its capital stock, (C) none of the Company or any of its subsidiaries
has incurred any liabilities or obligations, direct or contingent, which
are material, individually or in the aggregate, to the Company and its
subsidiaries,
8
taken as a whole, nor entered into any transaction not in the ordinary
course of business, and (D) none of the Company or any of its subsidiaries
has incurred any liabilities or obligations, direct or contingent, that are
material, individually or in the aggregate, to the Company and its
subsidiaries, taken as a whole, and that are required to be disclosed on a
balance sheet or notes thereto in accordance with generally accepted
accounting principles and are not disclosed on the latest balance sheet or
notes thereto included in the Prospectus.
(20) The Company is not an open-end investment company, unit
investment trust or face-amount certificate company that is or is required
to be registered under Section 8 of the United States Investment Company
Act of 1940 (the "Investment Company Act"); and the Company is not and,
after giving effect to the offering and sale of the Offered Securities and
the application of the proceeds thereof as described in the Prospectus,
will not be an "investment company" as defined in the Investment Company
Act.
(21) Each of the Company and its subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable assurance
that: (A) transactions are executed in accordance with management's general
or specific authorizations; (B) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets;
(C) access to assets is permitted only in accordance with management's
general or specific authorization; and (D) the recorded accountability for
assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect thereto.
(22) Each of the Company and its subsidiaries maintains insurance
covering its properties, operations, personnel and businesses, insuring
against such losses and risks as are consistent with industry practice to
protect the Company and its subsidiaries and their respective businesses.
None of the Company or any of its subsidiaries has received notice from any
insurer or agent of such insurer that substantial capital improvements or
other expenditures will have to be made in order to continue such
insurance.
(23) The statistical and market-related data included in the
Prospectus are based on or derived from sources that the Company believes
to be accurate and reliable in all material respects.
(24) The Company has not, directly or indirectly, (A) taken any action
designed to cause or to result in, or that has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation of
the price of any
9
security of the Company to facilitate the sale or resale of the Securities
or (B) since the filing of the Registration Statement (1) sold, bid for,
purchased, or paid anyone any compensation for soliciting purchases of, the
Securities or (2) paid or agreed to pay to any person any compensation for
soliciting another to purchase any other securities of the Company (except
for the sale of Securities by the Selling Shareholders under this
Agreement).
(25) Each certificate signed by any officer of the Company or any of
its subsidiaries and delivered to the Underwriters or counsel for the
Underwriters shall be deemed to be a representation and warranty by the
Company or such subsidiary to the Underwriters as to the matters covered
thereby.
(2) Each Selling Shareholder severally represents and warrants to, and
agrees with, the several Underwriters that:
(1) Such Selling Shareholder has and on each Closing Date hereinafter
mentioned will have valid and unencumbered title to the Offered Securities
to be delivered by such Selling Shareholder on such Closing Date, free and
clear of any pledge, lien, security interest, charge, claim, equity or
encumbrance of any kind; such Selling Shareholder has full right, power and
authority to enter into this Agreement and to sell, assign, transfer and
deliver the Offered Securities to be delivered by such Selling Shareholder
on such Closing Date hereunder; and upon the delivery of and payment for
the Offered Securities on each Closing Date hereunder such Selling
Shareholder will pass valid and unencumbered title to the Offered
Securities to be delivered by such Selling Shareholder to the several
Underwriters on such Closing Date.
(2) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement: (A) on the Effective
Date of the Initial Registration Statement, the Initial Registration
Statement did not include 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, (B) on the Effective Date of
the Additional Registration Statement (if any), each Registration Statement
did not include, or will not include, any untrue statement of a material
fact and did not omit, or will not omit, to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading, and (C) on the date of this Agreement, the Initial
Registration Statement and, if the Effective Time of the Additional
Registration Statement is prior to the execution and delivery of this
Agreement, the Additional Registration Statement, and at the time of filing
of the Prospectus pursuant to Rule 424(b) or (if no such filing is
required) at the Effective Date of the Additional Registration
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Statement in which the Prospectus is included, and on each Closing Date
neither each Registration Statement nor the Prospectus includes, or will
include, any untrue statement of a material fact or omits, or will omit to
state any material fact required to be stated therein or necessary to make
the statements therein not misleading. If the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of this
Agreement: on the Effective Date of the Initial Registration Statement and
on each Closing Date, neither the Initial Registration Statement nor the
Prospectus will include any untrue statement of a material fact or will
omit to state any material fact required to be stated therein or necessary
to make the statements therein not misleading. The two preceding sentences
apply only to the extent that any statements in or omissions from a
Registration Statement or the Prospectus are based on written information
furnished to the Company by such Selling Shareholder specifically for use
therein.
(3) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between such Selling Shareholder and any third
party that would give rise to a valid claim against the Company or any
Underwriter for a brokerage commission, finder's fee or other like payment
in connection with the transactions contemplated by this Agreement.
(4) This Agreement has been duly authorized, executed and delivered
by or on behalf of such Selling Shareholder and this Agreement constitutes
the legal, valid and binding obligations of such Selling Shareholder
enforceable against such Selling Shareholder in accordance with its terms
(except as rights to indemnification and contribution may be limited by
applicable federal or state law).
(5) No consent, approval, authorization, order, registration or
qualification of, or filing with, any third party (whether acting in an
individual, fiduciary or other capacity) or any governmental or regulatory
agency or body or court is required to be obtained or made by such Selling
Shareholder for the consummation of the transactions contemplated by this
Agreement, except such as have been obtained and made under the Act and
such as may be required under state securities laws.
(6) The execution, delivery and performance of this Agreement by such
Selling Shareholder and the consummation of the transactions herein and
therein contemplated will not conflict with or result in a breach or
violation of any of the terms and provisions of, or constitute a default
under (A) any statute, any rule, regulation or order of any governmental
agency or body or any court, domestic or foreign, having jurisdiction over
such Selling Shareholder or any of its properties or operations, or any
agreement or instrument to which such Selling Shareholder
11
is a party or by which such Selling Shareholder is bound or to which any of
the properties or operations of such Selling Shareholder is subject, or (B)
if applicable, the charter, by-laws or other organizational documents of
such Selling Shareholder, except, in the case of clause (A), for such
conflicts, breaches, violations or defaults which could not reasonably be
expected to, individually or in the aggregate, have a material adverse
effect on the consummation of the transactions contemplated by this
Agreement.
(7) Such Selling Shareholder has not taken and will not take,
directly or indirectly, any action designed to or that could reasonably be
expected to cause or result in stabilization or manipulation of the price
of the Offered Securities to facilitate the sale or resale of the Offered
Securities, and such Selling Shareholder has not distributed and will not
distribute any offering material in connection with the offering and sale
of the Offered Securities other than any preliminary prospectus filed with
the Commission or the Prospectus or other materials, if any, permitted by
the Act or the Rules and Regulations.
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, (i) each Selling Shareholder agrees,
severally and not jointly, to sell the number of Firm Securities set forth
opposite such Selling Shareholder's name in Schedule A hereto, and (ii) each
Underwriter agrees, severally and not jointly, to purchase from each such
Selling Shareholder, at a purchase price of $[_______] per share, that number of
Firm Securities (rounded up or down, as determined by Xxxxxx Brothers Inc.
("Xxxxxx") in its discretion, in order to avoid fractions) obtained by
multiplying the number of Firm Securities set forth opposite the name of such
Selling Shareholder in Schedule A hereto by a fraction the numerator of which is
the number of Firm Securities set forth opposite the name of such Underwriter in
Schedule B hereto and the denominator of which is the total number of Firm
Securities.
The Selling Shareholders will deliver the Firm Securities to the
Representatives for the accounts of the Underwriters, against payment of the
purchase price in Federal (same day) funds by official bank check or checks or
wire transfer to an account at a bank acceptable to Xxxxxx drawn to the order of
the respective Selling Shareholder in amounts relating to the number of Firm
Securities set forth opposite such Selling Shareholder's name in Schedule A
hereto, at the office of Xxxxxxx Xxxx Slate Xxxxxxx & Xxxx LLP ("Xxxxxxx Xxxx")
located at Xxxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 9:00 A.M., Eastern
Standard Time, on [____________], 2001, or at such other time not later than
seven full business days thereafter as Xxxxxx and the Selling Shareholders may
determine, such time being herein referred to as the "First Closing Date". The
certificates for the Firm Securities so to be delivered will be in definitive
form, in such denominations and registered in such names as Xxxxxx requests and
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will be made available for checking and packaging at the office of Xxxxxxx Xxxx
at least 24 hours prior to the First Closing Date.
In addition, upon written notice from Xxxxxx given to the Company and the
Selling Shareholders from time to time not more than 30 days subsequent to the
date of the Prospectus, the Underwriters may purchase all or less than all of
the Optional Securities at the purchase price per Security to be paid for the
Firm Securities. If the number of Optional Securities in the Underwriter's
notice ("Requested Amount") is equal to the total number of Optional Securities,
(i) each Selling Shareholder agrees, severally and not jointly, to sell to the
Underwriters the number of Optional Securities set forth opposite such Selling
Shareholder's name in Schedule A hereto and (ii) each Underwriter agrees,
severally and not jointly, to purchase from each Selling Shareholder that number
of Optional Securities (rounded up or down, as determined by Xxxxxx in its
discretion, in order to avoid fractions) obtained by multiplying the number of
Optional Securities set forth opposite the name of such Selling Shareholder in
Schedule A hereto by a fraction, the numerator of which is the number of Firm
Securities set forth opposite the name of such Underwriter in Schedule B hereto
and the denominator of which is the total number of Firm Securities. If the
Requested Amount is less than the total number of Optional Securities, the
Selling Shareholders shall sell, and the Underwriters shall purchase, such
Optional Securities on a pro rata basis.
No Optional Securities shall be sold or delivered unless the Firm
Securities previously have been, or simultaneously are, sold and delivered. The
right to purchase the Optional Securities or any portion thereof may be
exercised from time to time pursuant to the prior paragraph to the extent not
previously exercised and may be surrendered and terminated at any time upon
notice by Xxxxxx to the Company and the Selling Shareholders.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "Optional Closing Date", which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "Closing Date"), shall be determined by Xxxxxx
but shall be no later than five full business days after written notice of
election to purchase Optional Securities is given. The Selling Shareholders will
deliver the Optional Securities being purchased on each Optional Closing Date to
the Representatives for the accounts of the several Underwriters, against
payment of the purchase price therefor in Federal (same day) funds by official
bank check or checks or wire transfer (at the option of each Selling
Shareholder) to an account or accounts at a bank(s) acceptable to Xxxxxx drawn
to the order of each Selling Shareholder in amounts relating to the number of
Optional Securities being sold by each such Selling Shareholder as determined
pursuant to the two preceding paragraphs, at the above office of Xxxxxxx Xxxx.
The certificates for the Optional Securities being purchased on each Optional
Closing Date will be in definitive form, in such denominations and registered in
such names as Xxxxxx requests upon reasonable notice
13
prior to such Optional Closing Date and will be made available for checking and
packaging at the office of Xxxxxxx Xxxx at a reasonable time in advance of such
Optional Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Offered Securities for sale to the public as
set forth in the Prospectus.
5. Certain Agreements of the Company and the Selling Shareholders. The
Company and the several Selling Shareholders, to the extent such covenants
relate to their performance, agree with the several Underwriters that:
(1) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement, the Company will
file the Prospectus with the Commission pursuant to and in accordance with
subparagraph (1) (or, if applicable and if consented to by Xxxxxx,
subparagraph (4)) of Rule 424(b) not later than the earlier of (A) the
second business day following the execution and delivery of this Agreement
or (B) the fifteenth business day after the Effective Date of the Initial
Registration Statement. The Company will advise Xxxxxx promptly of any such
filing pursuant to Rule 424(b). If the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement and an additional registration statement is necessary to register
a portion of the Offered Securities under the Act but the Effective Time
thereof has not occurred as of such execution and delivery, the Company
will file the additional registration statement or, if filed, will file a
post-effective amendment thereto with the Commission pursuant to and in
accordance with Rule 462(b) on or prior to 10:00 A.M., New York time, on
the business day following the date of this Agreement or, if earlier, on or
prior to the time the Prospectus is printed and distributed to any
Underwriter, or will make such filing at such later date as shall have been
consented to by Xxxxxx.
(2) The Company will advise Xxxxxx promptly of any proposal to amend
or supplement the initial or any additional registration statement as filed
or the related prospectus or the Initial Registration Statement, the
Additional Registration Statement (if any) or the Prospectus and will not
effect such amendment or supplementation without Xxxxxx'x consent; and the
Company will also advise Xxxxxx promptly of the effectiveness of each
Registration Statement (if its Effective Time is subsequent to the
execution and delivery of this Agreement) and of any amendment or
supplementation of a Registration Statement or the Prospectus and of the
institution by the Commission of any stop order proceedings in respect of a
Registration Statement and will use its best efforts to prevent the
issuance of any such stop order and to obtain as soon as possible its
lifting, if issued.
14
(3) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with
sales by any Underwriter or dealer, any event occurs as a result of which
the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary at any time to
amend the Prospectus to comply with the Act, the Company will promptly
notify Xxxxxx of such event and will promptly prepare and file with the
Commission, at its own expense, an amendment or supplement which will
correct such statement or omission or an amendment which will effect such
compliance. Neither Xxxxxx'x consent to, nor the Underwriters' delivery of,
any such amendment or supplement shall constitute a waiver of any of the
conditions set forth in Section 6.
(4) As soon as practicable, but not later than the Availability Date
(as defined below), the Company will make generally available to its
securityholders an earnings statement covering a period of at least 12
months beginning after the Effective Date of the Initial Registration
Statement (or, if later, the Effective Date of the Additional Registration
Statement) which will satisfy the provisions of Section 11(a) of the Act.
For the purpose of the preceding sentence, "Availability Date" means the
45th day after the end of the fourth fiscal quarter following the fiscal
quarter that includes such Effective Date, except that, if such fourth
fiscal quarter is the last quarter of the Company's fiscal year,
"Availability Date" means the 90th day after the end of such fourth fiscal
quarter.
(5) The Company will furnish to the Representatives copies of each
Registration Statement (five of which will be signed and will include all
exhibits), each related preliminary prospectus, and, so long as a
prospectus relating to the Offered Securities is required to be delivered
under the Act in connection with sales by any Underwriter or dealer, the
Prospectus and all amendments and supplements to such documents, in each
case in such quantities as Xxxxxx requests. The Prospectus shall be so
furnished on or prior to 3:00 P.M., Eastern Standard Time, on the business
day following the later of the execution and delivery of this Agreement or
the Effective Time of the Initial Registration Statement. All other such
documents shall be so furnished as soon as available. The Company will pay
the expenses of printing and distributing to the Underwriters all such
documents.
(6) The Company will cooperate with the Underwriters and their
counsel in connection with the registration and qualification of the
Offered Securities for sale and the determination of their eligibility for
investment under the laws of such jurisdictions as Xxxxxx designates and do
all things necessary to continue such qualifications in effect so long as
required for the resale of the Offered Securities by the Underwriters,
15
provided that the Company will not be required to qualify as a foreign
corporation or to file a general consent to service of process in any such
jurisdiction.
(7) During the period of five years hereafter (or until such earlier
time as the Company is no longer required to file reports pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act")), the
Company will furnish to the Representatives and, upon request, to each of
the other Underwriters, as soon as practicable after the end of each fiscal
year, a copy of its annual report to shareholders for such year; and the
Company will furnish to the Representatives (i) as soon as available, a
copy of each report and any definitive proxy statement of the Company filed
with the Commission under the Exchange Act or mailed to shareholders, and
(ii) from time to time, such other information concerning the Company as
Xxxxxx may reasonably request.
(8) For a period of 90 days after the date of the public offering of
the Offered Securities, the Company will not offer, sell, contract to sell,
pledge or otherwise dispose of, directly or indirectly, or file with the
Commission a registration statement under the Act relating to, any
additional shares of its Securities or securities convertible into or
exchangeable or exercisable for any shares of its Securities, or publicly
disclose the intention to make any such offer, sale, pledge, disposition or
filing, without the prior written consent of Xxxxxx, except grants of
employee stock options pursuant to the terms of a plan in effect on the
date hereof, issuances of Securities pursuant to the exercise of such
options or the exercise of any other employee stock options outstanding on
the date hereof.
(9) The Company and each Selling Shareholder agree with the several
Underwriters that the Company will pay all expenses incident to the
performance of the obligations of the Company and such Selling Shareholder,
as the case may be, under this Agreement, for any filing fees and other
expenses (including fees and disbursements of counsel) in connection with
qualification of the Offered Securities for sale under the laws of such
jurisdictions as Xxxxxx designates and the printing of memoranda relating
thereto, for the filing fee incident to, and the reasonable fees and
disbursements of counsel to the Underwriters in connection with, the review
by the National Association of Securities Dealers, Inc.("NASD") of the
Offered Securities, for any travel expenses of the Company's officers and
employees and any other expenses of the Company in connection with
attending or hosting meetings with prospective purchasers of the Offered
Securities, for any transfer taxes on the sale by the Selling Shareholders
of the Offered Securities to the Underwriters and for expenses incurred in
distributing preliminary prospectuses and the Prospectus (including any
amendments and supplements thereto) to the Underwriters.
16
(10) Each Selling Shareholder agrees to deliver to Xxxxxx, attention:
[_____], on or prior to the first Closing Date a properly completed and
executed United States Treasury Department Form W-9 (or other applicable
form or statement specified by Treasury Department regulations in lieu
thereof).
(11) Each Selling Shareholder agrees, for a period of 90 days after
the date of the public offering of the Offered Securities, not to offer,
sell, contract to sell, pledge or otherwise dispose of, directly or
indirectly, any shares of Securities or securities convertible into or
exchangeable or exercisable for any shares of Securities, enter into a
transaction which would have the same effect, or enter into any swap, hedge
or other arrangement that transfers, in whole or in part, any of the
economic consequences of ownership of the Securities, whether any such
aforementioned transaction is to be settled by delivery of the Securities
or such other securities, in cash or otherwise, or publicly disclose the
intention to make any such offer, sale, pledge or disposition, or to enter
into any such transaction, swap, hedge or other arrangement, without, in
each case, the prior written consent of Xxxxxx Brothers Inc; provided,
however, if the last reported per share sale price of the Securities on the
NASDAQ National Market is at least 25% higher than the per share public
offering price on the cover of the Prospectus for 7 out of any 10
consecutive trading days ending on or after the 60th day after the date of
the Prospectus, then the foregoing restrictions shall be released with
respect to 50% of the undersigned's aggregate number of Securities that are
subject to such lock-up restrictions. Notwithstanding the foregoing, if
such Selling Shareholder is a partnership, the partnership may transfer any
Securities to a partner of such partnership or a retired partner of such
partnership who retires after the date hereof, or to the estate of any such
partner or retired partner, and any partner who is an individual may
transfer such Securities by gift or will or by intestate succession to his
or her family members; and if such Selling Shareholder is a corporation or
a limited liability company, the corporation may transfer such Securities
to any shareholder, member or subsidiary of such entity and any shareholder
or member who is an individual may transfer such Securities by gift, will
or intestate succession to his or her family members or to a charitable
organization; provided, however, that in any such case, it shall be a
condition to the transfer that the transferee execute an agreement stating
that the transferee is receiving and holding the Securities subject to the
provisions of this Agreement, and there shall be no further transfer of
such Securities except in accordance with this Agreement.
6. Conditions of the Obligations of the Underwriters. The obligations of
the several Underwriters to purchase and pay for the Firm Securities on the
First Closing Date and the Optional Securities to be purchased on each Optional
Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company and the Selling Shareholders herein, to
the accuracy of the statements of Company officers made pursuant to
17
the provisions hereof, to the performance by the Company and the Selling
Shareholders of their obligations hereunder and to the following additional
conditions precedent:
(1) The Representatives shall have received a letter, dated the date
of delivery thereof (which, if the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement, shall be on or prior to the date of this Agreement or, if the
Effective Time of the Initial Registration Statement is subsequent to the
execution and delivery of this Agreement, shall be prior to the filing of
the amendment or post-effective amendment to the registration statement to
be filed shortly prior to such Effective Time), of PricewaterhouseCoopers
LLP in agreed form confirming that they are independent public accountants
within the meaning of the Act and the published Rules and Regulations and
stating to the effect that:
(1) in their opinion the financial statements and schedules, for
all periods after July 3, 1999, examined by them and included in the
Registration Statements comply as to form in all material respects
with the applicable accounting requirements of the Act and the related
published Rules and Regulations;
(2) they have performed the procedures specified by the American
Institute of Certified Public Accountants for a review of interim
financial information as described in Statement of Auditing Standards
No. 71, Interim Financial Information, on the unaudited financial
statements, for all periods after July 3, 1999, and certain specified
financial information included in the Registration Statements;
(3) on the basis of the review referred to in clause (ii) above,
a reading of the latest available interim financial statements of the
Company and of all subsidiaries of the Company for which such interim
financial statements are provided, inquiries of officials of the
Company and of such subsidiaries who have responsibility for financial
and accounting matters and other specified procedures, nothing came to
their attention that caused them to believe that:
(1) with respect to the unaudited financial statements, for all
periods after July 3, 1999, included in the Registration
Statements, that any material modifications should be made
to such unaudited financial statements for them to be in
conformity with generally accepted accounting principles;
(2) at the date of the latest available balance sheet read by
such accountants, or at a subsequent date not more than
three business days prior to the date of this Agreement,
there was any change in the capital stock
18
or any increase in short-term indebtedness or long-term debt
of the Company and its consolidated subsidiaries or, any
decrease in consolidated net current assets or net assets,
as compared with amounts shown on the latest balance sheet
included in the Prospectus; or
(3) for the period from the closing date of the latest income
statement included in the Prospectus to the closing date of
the latest available income statement read by such
accountants there were any decreases, as compared with the
corresponding period of the previous year and with the
period of corresponding length ended the date of the latest
income statement included in the Prospectus, in consolidated
net sales or net operating income or net income;
except in all cases set forth in clause (A) above for changes, increases or
decreases which the Prospectus discloses have occurred or may occur or
which are described in such letter; and
(4) they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information
contained in the Registration Statements (in each case to the extent
that such dollar amounts, percentages and other financial information
are derived from the general accounting records of the Company and its
subsidiaries subject to the internal controls of the Company's
accounting system or are derived directly from such records by
analysis or computation) with the results obtained from inquiries, a
reading of such general accounting records and other procedures
specified in such letter and have found such dollar amounts,
percentages and other financial information to be in agreement with
such results, except as otherwise specified in such letter.
For purposes of this subsection (a) and subsection (b) below, (i) if the
Effective Time of the Initial Registration Statements is subsequent to the
execution and delivery of this Agreement, "Registration Statements" shall
mean the initial registration statement as proposed to be amended by the
amendment or post-effective amendment to be filed shortly prior to its
Effective Time, (ii) if the Effective Time of the Initial Registration
Statements is prior to the execution and delivery of this Agreement but the
Effective Time of the Additional Registration Statement is subsequent to
such execution and delivery, "Registration Statements" shall mean the
Initial Registration Statement and the additional registration statement as
proposed to be filed or as proposed to be amended by the post-effective
amendment to be filed shortly prior to its Effective Time, and (iii)
"Prospectus" shall mean the prospectus included in the Registration
19
Statements. All financial statements and schedules included in material
incorporated by reference into the Prospectus shall be deemed included in
the Registration Statements for purposes of this subsection (a) and
subsection (b) below.
(2) The Representatives shall have received a letter, dated the date
of this Agreement, of KPMG LLP in agreed form confirming that they are
independent public accountants within the meaning of the Securities Act and
the Rules and Regulations and to the effect that:
(1) in their opinion the financial statements and schedules, for
all periods prior to and including July 3, 1999, examined by them and
included in the Registration Statements for comply as to form in all
material respects with the applicable accounting requirements of the
Act and the related published Rules and Regulations; and
(2) they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information
contained in the Registration Statement (in each case to the extent
that such dollar amounts, percentages and other financial information
are derived from the general accounting records of the Company and its
subsidiaries subject to the internal controls of the Company's
accounting system or are derived directly from such records by
analysis or computation) with the results obtained from inquiries, a
reading of such general accounting records and other procedures
specified in such letter and have found such dollar amounts,
percentages and other financial information to be in agreement with
such results, except as otherwise specified in such letter.
(3) If the Effective Time of the Initial Registration Statement is
not prior to the execution and delivery of this Agreement, such Effective
Time shall have occurred not later than 10:00 P.M., Eastern Standard Time,
on the date of this Agreement or such later date as shall have been
consented to by Xxxxxx. If the Effective Time of the Additional
Registration Statement (if any) is not prior to the execution and delivery
of this Agreement, such Effective Time shall have occurred not later than
10:00 A.M., New York time, on the business day following the date of this
Agreement or, if earlier, the time the Prospectus is printed and
distributed to any Underwriter, or shall have occurred at such later date
as shall have been consented to by Xxxxxx. If the Effective Time of the
Initial Registration Statement is prior to the execution and delivery of
this Agreement, the Prospectus shall have been filed with the Commission in
accordance with the Rules and Regulations and Section 5(a) of this
Agreement. Prior to such Closing Date, no stop order suspending the
effectiveness of a Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted
20
or, to the knowledge of any Selling Shareholder, the Company or the
Representatives, shall be contemplated by the Commission.
(4) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred (i) any change, or any development or event
involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Company or its
subsidiaries, which, in the reasonable judgment of a majority in interest
of the Underwriters including the Representatives, is material and adverse
and makes it impractical or inadvisable to proceed with completion of the
public offering or the sale of and payment for the Offered Securities; (ii)
any downgrading in the rating of any debt securities of the Company by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Act), or any public announcement that any
such organization has under surveillance or review its rating of any debt
securities of the Company (other than an announcement with positive
implications of a possible upgrading, and no implication of a possible
downgrading, of such rating); (iii) any suspension or material limitation
of trading in securities generally on the New York Stock Exchange, the
American Stock Exchange or the Nasdaq National Market, or any establishment
of minimum or maximum prices for trading, or any requirement of maximum
ranges for prices for securities, on such exchange or the Nasdaq National
Market, or by such exchange or other regulatory body or governmental
authority having jurisdiction (other than limitations on price fluctuations
or minimums or maximums in effect as of the date of this Agreement), or any
suspension of trading of any securities of the Company on any exchange or
in the over-the-counter market; (iv) any banking moratorium declared by
federal or state authorities, or any moratorium declared in foreign
exchange trading by major international banks or persons; or (v) any
outbreak or escalation of armed hostilities involving the United States on
or after the date hereof, or if there has been a declaration by the United
States of a national emergency or war, the effect of which shall be, in the
Underwriters' reasonable judgment, to make it inadvisable or impracticable
to proceed with the public offering or delivery of the Offered Securities
on the terms and in the manner contemplated in the Prospectus.
(5) The Underwriters shall have received an opinion, dated the
Closing Date, of Xxxxxx Xxxxxxxx LLP, counsel for the Company that:
(1) Each of the Company and ICS Technologies, Inc. ("Delaware
Sub") (A) is duly incorporated and is validly existing as a
corporation in good standing under the laws of its jurisdiction of
incorporation, (B) has all requisite corporate power and authority to
carry on its business as it is currently being conducted and as
described in the Prospectus and to own, lease and operate its
properties, and (C) is duly qualified and in good standing as a
foreign corporation, authorized to do
21
business in each jurisdiction set forth beside such entity's name on a
schedule to such opinion;
(2) To such counsel's knowledge, except as disclosed in the
Prospectus, there are no contracts, agreements or understandings
between the Company and any person granting such person the right to
require the Company to file a registration statement under the Act
with respect to any securities of the Company owned or to be owned by
such person or to require the Company to include such securities in
the securities registered pursuant to a Registration Statement or in
any securities being registered pursuant to any other registration
statement filed by the Company under the Act;
(3) To such counsel's knowledge, all of the outstanding shares
of capital stock of Delaware Sub have been duly authorized and validly
issued and are fully paid and non-assessable, and are owned by the
Company, directly or indirectly through one or more subsidiaries, free
and clear of any adverse claim. The term "adverse claim" as used in
such opinion has the meaning given such term in Article 8 of the
Uniform Commercial Code and does not include (i) any claim which
arises through you or any person claiming through you (such as any
security interest you may have granted in the shares) and (ii) any
adverse interest which would not be extinguished upon the purchase of
the Offered Securities by a person who qualifies as a "bona fide
purchase" or "protected purchase" under Section 8-303 of the Uniform
Commercial Code;
(4) To the knowledge of such counsel, the Company was not
required under any New York, Pennsylvania or federal law to obtain any
consent, approval, authorization or order of any governmental agency
for the consummation of the transactions contemplated by this
Agreement in connection with the sale of the Offered Securities,
except for any such consent, approval, authorization or order which
may be required under the so-called "Blue Sky" or securities laws of
any states (as to which such counsel need express no opinion or
advice);
(5) The execution, delivery and performance of this Agreement
and the consummation of the transactions herein contemplated will not
constitute a violation by the Company of any applicable provision of
any New York, Pennsylvania or federal law, statute or regulation
(except that such counsel need express no opinion in this paragraph as
to compliance with any disclosure requirement or any prohibition
against fraud or misrepresentation or as to whether performance of the
indemnification or contribution provisions in this Agreement would be
permitted);
22
(6) The Company's execution and delivery of this Agreement and
the performance of its agreements in this Agreement and the
consummation of the sale of the Offered Securities to you in
accordance with this Agreement do not (i) constitute a violation by
the Company or Delaware Sub of any applicable provision of New York,
Pennsylvania or federal law, statute or regulation or the Delaware
General Corporate Law (except that we express no opinion in this
paragraph as to compliance with any disclosure requirement or any
prohibition against fraud or misrepresentation or as to whether
performance of the indemnification or contribution provisions in this
Agreement would be permitted) or (ii) breach, or result in a default
under, any existing obligation of the Company or Delaware Sub under
any of the agreements listed on a schedule to an officers' certificate
relating to such opinion (provided that such counsel need not express
any opinion as to compliance with any financial test or cross default
provision in any such agreement);
(7) Except as listed on a schedule to an officers' certificate
relating to such opinion, to such counsel's knowledge, there is no
action, suit, proceeding or investigation before or by any federal,
Pennsylvania or Delaware court or governmental agency or body,
domestic or foreign, pending or threatened against, the Company that
(i) has caused such counsel to conclude that such action, suit,
proceeding or investigation is required by Regulation S-K under the
Securities Act to be described in the Registration Statement but is
not described in the Prospectus or (ii) would be reasonably likely to
adversely affect the consummation of any of the transactions
contemplated by this Agreement. Such counsel has no knowledge about
any contract to which the Company is a party or to which any of its
property is subject that has caused us to conclude that such contract
is required to be described in the Prospectus but is not so described
or is required to be filed as an exhibit to the Registration Statement
but has not been so filed;
(8) The Company is not an "investment company" within the
meaning of the Investment Company Act;
(9) To such counsel's knowledge, there is no stop order
preventing the use of the Prospectus or the Registration Statements,
or any amendments or supplements thereto;
(10) The Initial Registration Statement was declared effective
under the Act as of the date and time specified in such opinion, the
Additional Registration Statement (if any) was filed and became
effective under the Act as of the date and time (if determinable)
specified in such opinion and the Prospectus either was filed with the
Commission pursuant to the subparagraph of Rule 424(b) specified
23
in such opinion on the date specified therein or was included in the
Initial Registration Statement or the Additional Registration
Statement (as the case may be);
(11) This Agreement has been duly and validly authorized,
executed and delivered by the Company;
(12) The Offered Securities delivered on such Closing Date and
all other outstanding shares of Common Stock of the of the Company
have been duly authorized and validly issued, are fully paid and
nonassessable and conform to the description thereof contained in the
Prospectus; and
(13) The execution, delivery or performance by the Company of
this Agreement does not violate, conflict with or constitute a breach
of any of the terms or provisions of, or a default under (or an event
that with notice or the lapse of time, or both, would constitute a
default under), or require consent under, or result in the imposition
of a lien or encumbrance on any properties of the Company or any of
the Significant Subsidiaries, or an acceleration of any indebtedness
of the Company or any of the Significant Subsidiaries pursuant to, (1)
the articles of incorporation or bylaws of the Company, (2) any
statute, rule or regulation of the Commonwealth of Pennsylvania
applicable to the Company or any of the Significant Subsidiaries or
any of their assets or properties or (3) to the best of such counsel's
knowledge, any judgment, order or decree known to such counsel of any
court or governmental agency or authority of the Commonwealth of
Pennsylvania having jurisdiction over the Company or any of the
Significant Subsidiaries or any of their assets or properties.
Assuming compliance with applicable federal, state and foreign
securities and Blue Sky laws, as to which no opinion is rendered
hereby, to the best of such counsel's knowledge, no consent, approval,
authorization or order of, or filing, registration, qualification,
license or permit of or with, (A) any Pennsylvania court or
governmental agency, body or administrative agency or (B) any other
person is required for the execution, delivery and performance by the
Company or any of the Significant Subsidiaries of this Agreement,
except such as have been obtained and made or have been disclosed in
the Prospectus.
Such counsel's opinion letter shall also contain the following language:
"We further advise you that we have participated in conferences with
officers and other representatives of the Company, representatives of
the independent public accountants for the Company, and the
Underwriters' representatives and counsel at which the Registration
Statement and the
24
Prospectus were prepared and at which the contents of the Registration
Statement, the Prospectus and related matters were discussed and,
although we have not passed upon or assumed any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus, and although, except as
otherwise may be expressly provided herein, we have not undertaken to
verify independently the accuracy or completeness of the statements in
the Registration Statement and the Prospectus and, therefore, would
not necessarily have become aware of any material misstatement of fact
or omission to state a material fact, on the basis of and subject to
the foregoing, and based upon our understanding of applicable law and
the experience we have gained in our practice thereunder and relying
as to materiality to a large extent upon the opinions and statements
of officers of the Company, we can, however, advise you that nothing
has come to our attention that has caused us to conclude that (i) the
Registration Statement at its effective date and the Closing Date
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading or (ii) the Prospectus at the date
it bears or on the Closing Date contained an untrue statement of a
material fact or omitted to state a material fact necessary in order
to make the statements therein, in light of the circumstances under
which they were made, not misleading or (iii) as of the effective date
either the Registration Statement or the Prospectus appeared on its
face not to be responsive in all material respects to the requirements
of the Act and the Rules and Regulations; it being understood that we
make no such statement in the case of clauses (i)-(iii) with respect
to the financial statements and schedules and other financial or
related statistical data included in the Registration Statement or the
Prospectus or omitted therefrom."
(6) The Representatives shall have received an opinion dated the
First Closing Date, and an opinion dated the applicable Optional Closing
Date, of Xxxxxxxx & Xxxxx, counsel for the Selling Shareholders, to the
effect that (for purposes of this paragraph (f), Selling Shareholders shall
exclude Combined Jewish Philanthropies, Fidelity Investments Charitable
Gifts Fund and The Xxxxxxx Charitable Trust):
(1) To such counsel's knowledge, all of the Offered Securities
being sold by such Selling Shareholder hereunder are owned by such
Selling Shareholder directly or indirectly through one or more
subsidiaries, free and clear of any adverse claim. Upon your payment
to each Selling Shareholder of the purchase price specified in this
Underwriting Agreement and the delivery to you of the certificate or
certificates representing the Offered Securities upon consummation of
the sale thereof in accordance with the Underwriting Agreement, you
will have
25
acquired ownership of the Offered Securities free and clear of any
adverse claim. The term "adverse claim" as used in such opinion has
the meaning given such term in Article 8 of the Uniform Commercial
Code and does not include (i) any claim which arises through you or
any person claiming through you (such as any security interest you may
have granted in the shares) and (ii) any adverse interest which would
not be extinguished upon the purchase of the Offered Securities by a
person who qualifies as a "bona fide purchase" or "protected purchase"
under Section 8-303 of the Uniform Commercial Code. We advise you that
we have no actual knowledge of the existence of any interest of the
kind specified in clause (ii) of the preceding sentence;
(2) This Agreement has been duly authorized, executed and
delivered on behalf of such Selling Shareholder;
(3) To the knowledge of such counsel, such Selling Shareholder
was not required under any New York or federal law to obtain any
consent, approval, authorization or order of any governmental agency
for the consummation of the transactions contemplated by this
Agreement, except for any such consent, approval, authorization or
order which may be required under the Act or under the so-called "Blue
Sky" or securities laws of any states (as to which such counsel need
express no opinion or advice); and
(4) The execution, delivery and performance of this Agreement by
such Selling Shareholder and the consummation of the transactions
herein and therein contemplated will not conflict with or result in a
breach or violation of any of the terms and provisions of, or
constitute a default under (A) to the knowledge of such counsel, any
statute, any rule, regulation or order of any governmental agency or
body or any court, domestic or foreign, having jurisdiction over such
Selling Shareholder or any of its properties or operations, or any
agreement or instrument to which such Selling Shareholder is a party
or by which such Selling Shareholder is bound or to which any of the
properties or operations of such Selling Shareholder is subject, or
(B) the charter, by-laws or other organizational documents of such
Selling Shareholder except, in the case of clause (A), for such
conflicts, breaches, violations or defaults which could not reasonably
be expected to, individually or in the aggregate, have a material
adverse effect on the consummation of the transactions contemplated by
this Agreement.
(7) The Representatives shall have received from Skadden, Arps,
Slate, Xxxxxxx & Xxxx LLP, counsel for the Underwriters, such opinion or
opinions, dated as of the Closing Date, with respect to the validity of the
Offered Securities delivered on such Closing Date, the Registration
Statements, the Prospectus and other related matters as
26
the Representatives may require, and the Selling Shareholders and the
Company shall have furnished to such counsel such documents as they request
for the purpose of enabling them to pass upon such matters.
(8) The Representatives shall have received from each director that
is affiliated with either Selling Shareholder as listed on Schedule C, a
letter agreement in the form attached as Exhibit I hereto, and from each
executive officer, director and senior management member of the Company
listed on Schedule D, a letter agreement in the form attached as Exhibit II
hereto.
(9) The Representatives shall have received a certificate, dated such
Closing Date, of the President or any Vice President and a principal
financial or accounting officer of the Company in which such officers shall
state that: the representations and warranties of the Company in this
Agreement are true and correct; the Company has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied hereunder at or prior to such Closing Date; no stop order
suspending the effectiveness of any Registration Statement has been issued
and no proceedings for that purpose have been instituted or are
contemplated by the Commission; the Additional Registration Statement (if
any) satisfying the requirements of subparagraphs (1) and (3) of Rule
462(b) was filed pursuant to Rule 462(b), including payment of the
applicable filing fee in accordance with Rule 111(a) or (b) under the Act,
prior to the time the Prospectus was printed and distributed to any
Underwriter; and, subsequent to the date of the most recent financial
statements in the Prospectus, there has been no material adverse change,
nor any development or event involving a prospective material adverse
change, in the condition (financial or other), business, properties or
results of operations of the Company and its subsidiaries taken as a whole
except as set forth in or contemplated by the Prospectus or as described in
such certificate.
(10) The Representatives shall have received a letter, dated such
Closing Date, of PricewaterhouseCoopers LLP which meets the requirements of
subsection (a) of this Section, except that the specified date referred to
in such subsection will be a date not more than three business days prior
to such Closing Date for the purposes of this subsection.
(11) The Securities to be delivered on such Closing Date are listed on
the Nasdaq National Market.
The Selling Shareholders and the Company will furnish the
Representatives with such conformed copies of such opinions, certificates,
letters and documents as the Representatives may reasonably request. Xxxxxx may
in its sole discretion waive on behalf of the
27
Underwriters compliance with any conditions to the obligations of the
Underwriters hereunder, whether in respect of an Optional Closing Date or
otherwise.
7. Indemnification and Contribution.
(1) The Company will indemnify and hold harmless each Underwriter,
its partners, directors and officers and each person, if any, who controls
such Underwriter within the meaning of Section 15 of the Act, against any
losses, claims, damages or liabilities, joint or several, to which such
Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon, (i) any untrue statement or alleged untrue
statement of any material fact contained in any Registration Statement, the
Prospectus, or any amendment or supplement thereto, or any related
preliminary prospectus, or (ii) the omission or alleged omission to state
therein or necessary to make the statements therein not misleading,
including any losses, claims, damages or liabilities arising out of or
based upon the Company's failure to perform its obligations under Section
5(a) of this Agreement, and will reimburse each Underwriter for any legal
or other expenses reasonably incurred by such Underwriter in connection
with investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred; provided, however, that (i) the
Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement in or omission or alleged omission
from any of such documents in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives 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 subsection (c) below and (ii) that
the Company shall not be liable to any such Underwriter with respect to any
untrue statement or alleged untrue statement or omission or alleged
omission in the preliminary prospectus to the extent that any such loss,
liability, claim, damage or expense of such Underwriter results from the
fact that such Underwriter sold Offered Securities to a person to whom
there was not sent or given, at or prior to the written confirmation of
such sale, a copy of the Prospectus as then amended or supplemented if the
Company had previously furnished copies thereof to such Underwriter and the
loss, liability, claim, damage or expense of such Underwriter results from
an untrue statement or omission of a material fact contained in the
preliminary prospectus, which was corrected in the Prospectus as then
amended or supplemented.
Insofar as the foregoing indemnity agreement, or the
representations and warranties contained in Section 2(a)(ii), may permit
indemnification for liabilities under the Act of any person who is an
Underwriter or a partner or controlling person of an Underwriter within the
meaning of Section 15 of the Act and who, at the date of this
28
Agreement, is a director, officer or controlling person of the Company, the
Company has been advised that in the opinion of the Commission such
provisions may contravene Federal public policy as expressed in the Act and
may therefore be unenforceable. In the event that a claim for
indemnification under such agreement or such representations and warranties
for any such liabilities (except insofar as such agreement provides for the
payment by the Company of expenses incurred or paid by a director, officer
or controlling person in the successful defense of any action, suit or
proceeding) is asserted by such a person, the Company will submit to a
court of appropriate jurisdiction (unless in the opinion of counsel for the
Company the matter has already been settled by controlling precedent) the
question of whether or not indemnification by it for such liabilities is
against public policy as expressed in the Act and therefore unenforceable,
and the Company will be governed by the final adjudication of such issue.
(2) Each Selling Shareholder will severally and not jointly indemnify
and hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become
subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in any Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any related preliminary prospectus, or
arise out of or are based upon the omission or alleged omission therein of
a material fact required to be stated therein or necessary to make the
statements therein, not misleading, and will reimburse each Underwriter for
any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred, in each case only to the
extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement in or omission
or alleged omission from any of such documents in reliance upon and in
conformity with written information furnished by such Selling Shareholder
specifically for use therein; provided, however, that the Selling
Shareholders will not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement in or omission or alleged
omission from any of such documents in reliance upon and in conformity with
written information furnished to the Company by an Underwriter through the
Representatives 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 subsection (c) below; provided,
further, that no Selling Shareholder shall be liable to any such
Underwriter with respect to any untrue statement or alleged untrue
statement or omission or alleged omission in the preliminary prospectus to
the extent that any such loss, liability, claim, damage or expense of such
Underwriter results from the fact that such Underwriter sold Offered
Securities to a person to whom there was not sent or given, at or prior to
the written
29
confirmation of such sale, a copy of the Prospectus as then amended or
supplemented if the Company had previously furnished copies thereof to such
Underwriter and the loss, liability, claim, damage or expense of such
Underwriter results from an untrue statement or omission of a material fact
contained in the preliminary prospects which was corrected in the
Prospectus. Notwithstanding the foregoing, the aggregate liability of any
Selling Shareholder pursuant to the provisions of this paragraph shall be
limited to an amount equal to the aggregate sale price received by such
Selling Shareholder from the sale of such Selling Shareholder's shares
hereunder.
(3) Each Underwriter will severally and not jointly indemnify and
hold harmless the Company, its directors and officers and each person, if
any, who controls the Company within the meaning of Section 15 of the Act,
and each Selling Shareholder against any losses, claims, damages or
liabilities to which the Company or such Selling Shareholder may become
subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in any Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any related preliminary prospectus, or
arise out of or are based upon the omission or the alleged omission therein
of 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 reliance upon and in conformity
with written information furnished to the Company by such Underwriter
through the Representatives specifically for use therein, and will
reimburse any legal or other expenses reasonably incurred by the Company
and each Selling Shareholder in connection with investigating or defending
any such loss, claim, damage, liability or action as such expenses are
incurred, it being understood and agreed that the only such information
furnished by any Underwriter consists of (i) the following information in
the Prospectus furnished on behalf of each Underwriter: the concession and
reallowance figures appearing in the third paragraph under the caption
"Underwriting" and the over-allotments and stabilizing descriptions
appearing in the fourteenth and fifteenth paragraphs under the caption
"Underwriting" and (ii) the following information in the Prospectus
furnished on behalf of the Representatives.:
"Xxxxxx Brothers Inc., Xxxxxxxxx Xxxxxxxx, Inc., Bear, Xxxxxxx & Co.
Inc., PMG Capital and their respective affiliates have performed and
expect to continue to perform financial advisory and investment and
commercial banking services for us for which they have received and
will receive customary compensation. ICST Acquisition Corp., an
affiliate of Bear, Xxxxxxx & Co. Inc., will be a selling shareholder
in the offering. Xxxx X. Xxxxxx, a
30
member of our Board of Directors, is a Senior Managing Director of
Bear, Xxxxxxx & Co. Inc."
(4) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party shall,
if a claim in respect thereof is to be made against an indemnifying party
under subsection (a), (b) or (c) above notify each party against whom
indemnification is to be sought in writing of the commencement thereof; but
the failure so to notify an indemnifying party shall not relieve it from
any liability which it may have under this Section except to the extent
that it has been prejudiced in any material respect by such failure or from
any liability which it may have otherwise than under subsection (a), (b) or
(c) above. In case any such action is brought against any indemnified
party, and it notifies an indemnifying party of the commencement thereof,
the indemnifying party will be entitled to participate therein, and to the
extent it may elect by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof with counsel reasonably satisfactory to such
indemnified party. Notwithstanding the foregoing, the indemnified party or
parties shall have the right to employ its or their own counsel in any such
case, but the fees and expenses of such counsel shall be at the expense of
such indemnified party or parties unless (i) the employment of such counsel
shall have been authorized in writing by the indemnifying parties in
connection with the defense of such action, (ii) the indemnifying parties
shall not have employed counsel to take charge of the defense of such
action within a reasonable time after notice of commencement of the action,
or (iii) such indemnified party or parties shall have reasonably concluded
that there may be defenses available to it or them which are different from
or additional to those available to one or all of the indemnifying parties
(in which case the indemnifying party or parties shall not have the right
to direct the defense of such action on behalf of the indemnified party or
parties), in any of which events such fees and expenses of counsel shall be
borne by the indemnifying parties; provided, however, that the indemnifying
party under subsection (a) or (b) above shall only be liable for the legal
expenses of one counsel (in addition to any local counsel) for all
indemnified parties in each jurisdiction in which any claim or action is
brought. No indemnifying party shall, without prior written consent of the
indemnified party, effect any settlement of any pending or threatened
action in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified
party unless such settlement includes an unconditional release of such
indemnified party from all liability on any claims that are the subject
matter of such action and does not include a statement as to and an
admission of fault, culpability or failure to act by or on behalf of any
indemnified party. Anything in this subsection to the contrary
notwithstanding, an indemnifying party shall not be liable for any
settlement of any claim or action effected without its prior written
consent, provided that such consent was not
31
unreasonably withheld, and that if at any time an indemnified party shall
have requested an indemnifying party to reimburse the indemnified party for
fees and expenses of counsel, such indemnifying party agrees it shall be
liable for any settlement effected without its written consent if (i) such
settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (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.
(5) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a), (b) or (c) above, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a
result of the losses, claims, damages or liabilities referred to in
subsection (a), (b) or (c) above (i) in such proportion as is appropriate
to reflect the relative benefits received by the Company and the Selling
Shareholders on the one hand and the Underwriters on the other from the
offering of the Securities 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 Company and the Selling
Shareholders on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Company and the
Selling Shareholders on the one hand and the Underwriters on the other
shall be deemed to be in the same proportion as the total net proceeds from
the offering (before deducting expenses) received by the Company and the
Selling Shareholders bear to the total underwriting discounts and
commissions received by the Underwriters. 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, the Selling Shareholders or the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The amount paid by an
indemnified party as a result of the losses, claims, damages or liabilities
referred to in the first sentence of this subsection (e) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any action or claim
which is the subject of this subsection (e). Notwithstanding the provisions
of this subsection (e), (i) no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the
Securities underwritten by it and distributed to the public were offered to
the public exceeds the amount of any damages which such Underwriter has
otherwise been required to pay by reason of such untrue or alleged
32
untrue statement or omission or alleged omission and (ii) no Selling
Shareholder shall be required to contribute any amount in excess of the
amount by which the aggregate sale price received by such Selling
Shareholder from the sale of the Offered Securities hereunder exceeds the
amount of any damages or indemnification which such Selling Shareholder has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this
subsection (e) to contribute are several in proportion to their respective
underwriting obligations and not joint. The Selling Shareholders'
obligations in this subsection (e) to contribute are several and not joint.
(6) The obligations of the Company and the Selling Shareholders under
this Section shall be in addition to any liability which the Company and
the Selling Shareholders may otherwise have and shall extend, upon the same
terms and conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act; and the obligations of the Underwriters
under this Section shall be in addition to any liability which the
respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each director of the Company, to each officer of
the Company who has signed a Registration Statement and to each person, if
any, who controls the Company within the meaning of the Act.
8. Default of Underwriters. If any Underwriter or Underwriters default in
their obligations to purchase Offered Securities hereunder on either the First
or any Optional Closing Date and the aggregate number of shares of Offered
Securities that such defaulting Underwriter or Underwriters agreed but failed to
purchase does not exceed 10% of the total number of shares of Offered Securities
that the Underwriters are obligated to purchase on such Closing Date, Xxxxxx may
make arrangements satisfactory to the Company and the Selling Shareholders for
the purchase of such Offered Securities by other persons, including any of the
Underwriters, but if no such arrangements are made by such Closing Date, the
non-defaulting Underwriters shall be obligated severally, in proportion to their
respective commitments hereunder, to purchase the Offered Securities that such
defaulting Underwriters agreed but failed to purchase on such Closing Date. If
any Underwriter or Underwriters so default and the aggregate number of shares of
Offered Securities with respect to which such default or defaults occur exceeds
10% of the total number of shares of Offered Securities that the Underwriters
are obligated to purchase on such Closing Date and arrangements satisfactory to
Xxxxxx, the Company and the Selling Shareholders for the purchase of such
Offered Securities by other persons are not made within 36 hours after such
default, this Agreement will terminate without liability on the part of any
non-defaulting Underwriter, the Company or the Selling Shareholders, except as
provided in Section 9 (provided that if such default occurs with respect to
Optional Securities after the First Closing Date, this Agreement will not
terminate as to the
33
Firm Securities or any Optional Securities purchased prior to such termination).
As used in this Agreement, the term "Underwriter" includes any person
substituted for an Underwriter under this Section. Nothing herein will relieve a
defaulting Underwriter from liability for its default.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Selling Shareholders of the Company or its officers and of the several
Underwriters set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation, or statement as to the
results thereof, made by or on behalf of any Underwriter, any Selling
Shareholder, the Company or any of their respective representatives, officers or
directors or any controlling person, and will survive delivery of and payment
for the Offered Securities. If this Agreement is terminated pursuant to Section
8 or if for any reason the purchase of the Offered Securities by the
Underwriters is not consummated, the Company and the Selling Shareholders shall
remain responsible for the expenses to be paid or reimbursed by them pursuant to
Section 5 and the respective obligations of the Company, the Selling
Shareholders and the Underwriters pursuant to Section 7 shall remain in effect,
and if any Offered Securities have been purchased hereunder the representations
and warranties in Section 2 and all obligations under Section 5 shall also
remain in effect. If the purchase of the Offered Securities by the Underwriters
is not consummated for any reason other than solely because of the termination
of this Agreement pursuant to Section 8 or the occurrence of any event specified
in clause (iii), (iv) or (v) of Section 6(d) the Company and the Selling
Shareholders will, jointly and severally, reimburse the Underwriters for all
out-of-pocket expenses (including fees and disbursements of counsel) reasonably
incurred by them in connection with the offering of the Offered Securities.
10. Notices. All communications hereunder will be in writing and:
(a if sent to the Underwriter, shall be delivered or sent by mail, telex
or facsimile transmission to : Xxxxxx Brothers Inc., Three World Financial
Center, New York, New York 10285, Attention: Syndicate Department (Fax: (212)
000-0000), with a copy, in the case of any notice pursuant to 7(d), to the
Director of Litigation, Office of the General Counsel, Xxxxxx Brothers Inc.,
Three World Financial Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000; provided,
however, that any notice to an Underwriter pursuant to Section 7 or Section 9
will be mailed, delivered or telegraphed and confirmed to such Underwriter.
with a copy to Skadden, Arps, Slate, Xxxxxxx & Xxxx, Four Times Square, New
York, New York, 10036, Attention: Xxxx Xxxxx, Esq.(Fax: (000) 000-0000;
Telephone: (000) 000-0000);
(b if sent to the Company, shall be delivered or sent by mail, telex or
facsimile transmission to: Integrated Circuit Systems, Inc., 0000 Xxxxxxxxx xx
xxx Xxxxxxxx, Xxxxxx Xxxxx, XX 00000, Attention: Chief Financial Officer,
34
with a copy to Xxxxxx Xxxxxxxx LLP, 3000 Two Xxxxx Square, 00xx xxx Xxxx
Xxxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000, Attention: Xxxxxx X. Xxxxxxx, Esq.
(Fax: (000) 000-0000 Telephone: (000) 000-0000);
(c if sent to any of the Selling Shareholders, shall be delivered or sent
by mail, telex or facsimile transmission to: Xxxxxxxx & Xxxxx, Citicorp Center,
000 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000-0000, Attention: Xxxxx X. Xxxx,
Esq.(Fax:(000) 000-0000 Telephone:(000) 000-0000)
11. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective personal representatives and
successors and the officers and directors and controlling persons referred to in
Section 7, and no other person will have any right or obligation hereunder.
12. Representation. The Representatives will act for the several
Underwriters in connection with the transactions contemplated by this Agreement,
and any action under this Agreement taken by the Representatives jointly or by
Xxxxxx will be binding upon all the Underwriters.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement. Delivery by
telecopy or facsimile transmission of an executed counterpart of this Agreement
shall be considered due and sufficient delivery.
14. Applicable Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York, without regard to principles
of conflicts of laws.
THE COMPANY AND EACH SELLING SHAREHOLDER HEREBY SUBMIT TO THE NON-EXCLUSIVE
JURISDICTION OF THE FEDERAL AND STATE COURTS IN THE BOROUGH OF MANHATTAN IN THE
CITY OF NEW YORK IN ANY SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
35
If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement among the Selling
Shareholders, the Company and the several Underwriters in accordance with its
terms.
Very truly yours,
INTEGRATED CIRCUIT SYSTEMS, INC.
-----------------------------------
Name:
Title:
S-1
If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement among the Selling
Shareholders, the Company and the several Underwriters in accordance with its
terms.
Very truly yours,
XXXX CAPITAL FUND VI, L.P.
By: Xxxx Capital Partners VI, L.P.,
its General Partner
By: Xxxx Capital Investors VI, Inc.,
its General Partner
By:______________________________
Name:
Title:
BCIP ASSOCIATES II
BCIP TRUST ASSOCIATES II
BCIP ASSOCIATES II-B
BCIP TRUST ASSOCIATES II-B
BCIP ASSOCIATES II-C
By: Xxxx Capital, Inc.,
their Managing General Partner
By:______________________________
Name:
Title:
PEP INVESTMENTS PTY LTD.
By: Xxxx Capital, Inc.,
its Attorney-in-Fact
By:______________________________
Name:
Title:
S-2
If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement among the Selling
Shareholders, the Company and the several Underwriters in accordance with its
terms.
Very truly yours,
ICST ACQUISITION CORP.
-------------------------------------
Name:
Title:
S-3
If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement among the Selling
Shareholders, the Company and the several Underwriters in accordance with its
terms.
Very truly yours,
COMBINED JEWISH PHILANTHROPIES
-------------------------------------
Name:
Title:
S-4
If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement among the Selling
Shareholders, the Company and the several Underwriters in accordance with its
terms.
Very truly yours,
FIDELITY INVESTMENTS CHARITABLE GIFTS FUND
-------------------------------------
Name:
Title:
S-5
If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement among the Selling
Shareholders, the Company and the several Underwriters in accordance with its
terms.
Very truly yours,
THE XXXXXXX CHARITABLE TRUST
-------------------------------------
Name:
Title:
S-6
The foregoing Underwriting Agreement
is hereby confirmed and accepted as of
the date first above written.
XXXXXX BROTHERS INC.
X.X. XXXXXX SECURITIES INC.,
XXXXXXXXX XXXXXXXX, INC.,
BEAR, XXXXXXX & CO. INC. and
PMG CAPITAL
Acting on behalf of themselves and as the
Representatives of the several Underwriters.
By: XXXXXX BROTHERS INC.
----------------------------------------
Name:
Title:
S-7
SCHEDULE A
---------------------------------------------- ------------------------- --------------------------
Selling Shareholders Number of Firm Number of Option
of Securities Securities to be Sold Securities to be Sold
Xxxx Capital Fund VI, L.P.
BCIP Trust Associates II
BCIP Trust Associates II-B
BCIP Associates II
BCIP Associates II-B
BCIP Associates II-C
PEP Investments PTY Ltd.
ICST Acquisition Corp.
Combined Jewish Philanthropies
Fidelity Investments Charitable Gifts Fund
The Xxxxxxx Charitable Trust
Total Firm Securities 9,000,000
Total Option Securities 1,350,000
A-1
SCHEDULE B
Underwriters
Underwriter Number of
----------- Firm Securities
to be Purchased
---------------
Xxxxxx Brothers Inc. .....................................
X.X. Xxxxxx Securities Inc. ..............................
Xxxxxxxxx Xxxxxxxx, Inc. ................................
Bear, Xxxxxxx & Co. Inc. .................................
PMG CAPITAL ... ..........................................
Total .................................. 9,000,000
B-1
SCHEDULE C
Executive Officers and Directors affiliated with the Selling Shareholders:
. Xxxxxxx X. Xxxxxx
. Xxxx Xxxxxx
C-1
SCHEDULE D
Executive Officers and Directors and Certain Other Shareholders:
. Xxxx Xxx
. Xx Xxxxxxxxxxxx
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D-1
Exhibit I
Form of Lock-Up Agreement
May __, 2001
Integrated Circuit Systems, Inc.
0000 Xxxxxxxxx xx xxx Xxxxxxxx
Xxxxxx Xxxxx, XX 00000
Attention: Justine Xxxx
XXXXXX BROTHERS INC.,
X.X. XXXXXX SECURITIES INC.,
XXXXXXXXX XXXXXXXX, INC,
BEAR, XXXXXXX & CO. INC. and
PMG CAPITAL
As Representatives of the Several Underwriters,
c/x Xxxxxx Brothers Inc.
Three World Financial Center
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
As an inducement to the Underwriter to execute the Underwriting Agreement,
pursuant to which a public offering will be made of the Common Stock, par value
$.01 per share (the "Securities") of Integrated Circuit Systems, Inc. (the
"Company"), the undersigned hereby agrees that from the date hereof and until 90
days after the public offering date set forth on the final prospectus
("Prospectus") used to sell the Securities (the "Public Offering Date") pursuant
to the Underwriting Agreement, to which you are or expect to become parties, the
undersigned will not offer, sell, contract to sell, pledge or otherwise dispose
of, directly or indirectly, any shares of Securities or securities convertible
into or exchangeable or exercisable for any shares of Securities, enter into a
transaction which would have the same effect, or enter into any swap, hedge or
other arrangement that transfers, in whole or in part, any of the economic
consequences of ownership of the Securities, whether any such aforementioned
transaction is to be settled by delivery of the Securities or such other
securities, in cash or otherwise, or publicly disclose the intention to make any
such offer, sale, pledge or disposition, or to enter into any such transaction,
swap, hedge or other arrangement, without, in each case, the prior written
consent of Xxxxxx Brothers Inc; provided, however, if the last reported per
Exhibit I-1
share sale price of the Securities on the NASDAQ National Market is at least 25%
higher than the per share public offering price on the cover of the Prospectus
for 7 out of any 10 consecutive trading days ending on or after the 60th day
after the date of the Prospectus, then the foregoing restrictions shall be
released with respect to 50% of the undersigned's aggregate number of Securities
subject to lock-up restrictions with the Underwriter. The foregoing sentence
shall not apply to (a) the sale of any Securities to the Underwriter pursuant to
the Underwriting Agreement or (b) transactions relating to shares of Securities
or other securities acquired in open market transactions after the completion of
the Public Offering.
In addition, the undersigned agrees that, without the prior written consent
of Xxxxxx Brothers Inc., it will not, during the period commencing on the date
hereof and ending 90 days after the Public Offering Date, make any demand for or
exercise any right with respect to, the registration of any Securities or any
security convertible into or exercisable or exchangeable for the Securities.
The undersigned shall not be restricted by the terms of this Agreement from
exercising any options granted to the undersigned; provided, however, that any
Securities received upon exercise of options granted to the undersigned will be
subject to this Agreement. Notwithstanding the foregoing, the undersigned may
transfer any Securities either during his or her lifetime or on death by will or
by intestacy to member of his family or to a trust, the beneficiaries of which
are exclusively the undersigned and/or a member or of his family or to a
charitable organization; provided, however, that in any such case it shall be a
condition to the transfer that the transferee execute an agreement stating that
the transferee is receiving and holding the Securities transferred subject to
the provisions of this Agreement, and there shall be no further transfer of such
Securities except in accordance with this Agreement.
In furtherance of the foregoing, the Company and its transfer agent and
registrar are hereby authorized to decline to make any transfer of shares of
Securities if such transfer would constitute a violation or breach of this
Agreement.
This Agreement shall be binding on the undersigned and the successors,
heirs, and assigns of the undersigned. This Agreement shall lapse and become
null and void if the Public Offering Date shall not have occurred on or before
June 1, 2001.
Very truly yours,
Exhibit I-2
Exhibit II
Form of Lock-Up Agreement
May __, 2001
Integrated Circuit Systems, Inc.
0000 Xxxxxxxxx xx xxx Xxxxxxxx
Xxxxxx Xxxxx, XX 00000
Attention: Justine Xxxx
XXXXXX BROTHERS INC.,
X.X. XXXXXX SECURITIES INC.,
XXXXXXXXX XXXXXXXX, INC,
BEAR, XXXXXXX & CO. INC. and
PMG CAPITAL
As Representatives of the Several Underwriters,
c/x Xxxxxx Brothers Inc.
Three World Financial Center
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
As an inducement to the Underwriters to execute the Underwriting Agreement,
pursuant to which a public offering will be made of the Common Stock, par value
$.01 per share (the "Securities") of Integrated Circuit Systems, Inc. (the
"Company"), the undersigned hereby agrees that from the date hereof and until 60
days after the public offering date set forth on the final prospectus used to
sell the Securities (the "Public Offering Date") pursuant to the Underwriting
Agreement, to which you are or expect to become parties, the undersigned will
not offer, sell, contract to sell, pledge or otherwise dispose of, directly or
indirectly, any shares of Securities or securities convertible into or
exchangeable or exercisable for any shares of Securities, enter into a
transaction which would have the same effect, or enter into any swap, hedge or
other arrangement that transfers, in whole or in part, any of the economic
consequences of ownership of the Securities, whether any such aforementioned
transaction is to be settled by delivery of the Securities or such other
securities, in cash or otherwise, or publicly disclose the intention to make any
such offer, sale, pledge or disposition, or to enter into any such transaction,
swap, hedge or other arrangement, without, in each case, the prior written
consent of Xxxxxx Brothers Inc. In addition, the undersigned agrees that,
without the prior written
Exhibit II-1
consent of Xxxxxx Brothers Inc., it will not, during the period commencing on
the date hereof and ending 90 days after the Public Offering Date, make any
demand for or exercise any right with respect to, the registration of any
Securities or any security convertible into or exercisable or exchangeable for
the Securities.
The undersigned shall not be restricted by the terms of this Agreement from
exercising any options granted to the undersigned; provided, however, that any
Securities received upon exercise of options granted to the undersigned will be
subject to this Agreement. Any Securities acquired by the undersigned in the
open market will not be subject to this Agreement. A transfer of Securities to a
family member or trust may be made, provided the transferee agrees to be bound
in writing by the terms of this Agreement.
In furtherance of the foregoing, the Company and its transfer agent and
registrar are hereby authorized to decline to make any transfer of shares of
Securities if such transfer would constitute a violation or breach of this
Agreement.
This Agreement shall be binding on the undersigned and the successors,
heirs, personal representatives and assigns of the undersigned. This Agreement
shall lapse and become null and void if the Public Offering Date shall not have
occurred on or before June 1, 2001.
Very truly yours,
Exhibit II-2
