Exhibit 1.1
OCEAN POWER TECHNOLOGIES, INC.
___ Shares
Common Stock
($0.001 par value per Share)
FORM OF
UNDERWRITING AGREEMENT
_____, 2007
FORM OF
UNDERWRITING AGREEMENT
_____, 2007
UBS Securities LLC
Banc of America Securities LLC
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
First Albany Capital Inc.
as Managing Underwriters
c/o UBS Securities LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Banc of America Securities LLC
▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
OCEAN POWER TECHNOLOGIES, INC. (the "Company") proposes to issue and
sell to the underwriters named in Schedule A annexed hereto (the
"Underwriters"), for whom UBS Securities LLC, Banc of America Securities LLC and
Bear, ▇▇▇▇▇▇▇ & Co. Inc. are acting as representatives (collectively, the
"Representatives"), an aggregate of __ shares (the "Firm Shares") of common
stock, $0.001 par value per share (the "Common Stock"), of the Company. In
addition, solely for the purpose of covering over-allotments, the Company and
each stockholder (each, a "Selling Stockholder") identified as a Selling
Stockholder in Schedule C annexed hereto, propose to grant to the Underwriters
the option to purchase up to __ shares of Common Stock (the "Additional
Shares"), of which up to __ Additional Shares are to be issued and sold by the
Company and up to __ Additional Shares are to be sold by the Selling
Stockholders. The Firm Shares and the Additional Shares are hereinafter
collectively sometimes referred to as the "Shares." The Shares are described in
the Prospectus which is referred to below.
On or prior to the first time of purchase (as hereinafter defined),
pursuant to an Agreement and Plan of Merger dated ______, 2007, the Company will
have reincorporated under the laws of the State of Delaware, as described in the
Preliminary Prospectus and the Prospectus (as hereinafter defined) under the
caption "Description of Capital Stock - General" (the "Reincorporation"). As
used in this Agreement, references to the "Company" shall at all times prior to
the consummation of the Reincorporation be deemed to be references to Ocean
Power Technologies, Inc., a New Jersey corporation, and shall at all times from
and after the consummation of the Reincorporation be deemed to be references to
Ocean Power Technologies, Inc., a Delaware corporation.
The Company has prepared and filed, in accordance with the provisions
of the Securities Act of 1933, as amended, and the rules and regulations
thereunder (collectively, the "Act"), with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-1 (File No.
333-138595) under the Act, including a prospectus, relating to the Shares.
Except where the context otherwise requires, "Registration Statement,"
as used herein, means the registration statement, as amended at the time of such
registration statement's effectiveness for purposes of Section 11 of the Act, as
such section applies to the respective Underwriters (the "Effective Time"),
including (i) all documents filed as a part thereof, (ii) any information
contained in a prospectus filed with the Commission pursuant to Rule 424(b)
under the Act, and deemed, pursuant to Rule 430A or Rule 430C under the Act, to
be part of the registration statement at the Effective Time, and (iii) any
registration statement filed to register the offer and sale of Shares pursuant
to Rule 462(b) under the Act.
The Company has furnished to you, for use by the Underwriters and by
dealers in connection with the offering of the Shares, copies of one or more
preliminary prospectuses relating to the Shares. Except where the context
otherwise requires, "Preliminary Prospectus," as used herein, means each such
preliminary prospectus, in the form so furnished.
Except where the context otherwise requires, "Prospectus," as used
herein, means the prospectus, relating to the Shares, filed by the Company with
the Commission pursuant to Rule 424(b) under the Act on or before the second
business day after the date hereof (or such earlier time as may be required
under the Act), or, if no such filing is required, the final prospectus included
in the Registration Statement at the time it became effective under the Act, in
each case in the form furnished by the Company to you for use by the
Underwriters and by dealers in connection with the offering of the Shares.
"Permitted Free Writing Prospectuses," as used herein, means the
documents listed in Schedule B annexed hereto and each "road show" (as defined
in Rule 433 under the Act), if any, related to the offering of the Shares
contemplated hereby that is a "written communication" (as defined in Rule 405
under the Act) (each such road show, an "Electronic Road Show"). The
Underwriters have not offered or sold and will not offer or sell, without the
Company's consent, any Shares by means of any "free writing prospectus" (as
defined in Rule 405 under the Act) that is required to be filed by the
Underwriters with the Commission pursuant to Rule 433 under the Act, other than
a Permitted Free Writing Prospectus.
"Disclosure Package," as used herein, means any Preliminary Prospectus
together with any combination of one or more of the Permitted Free Writing
Prospectuses, if any.
As used in this Agreement, "business day" shall mean a day on which
the New York Stock Exchange (the "NYSE") is open for trading. The terms
"herein," "hereof," "hereto," "hereinafter" and similar terms, as used in this
Agreement, shall in each case refer to this Agreement as a whole and not to any
particular section, paragraph, sentence or other subdivision of this Agreement.
The term "or," as used herein, is not exclusive.
-2-
The Company has prepared and filed, in accordance with Section 12 of
the Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder (collectively, the "Exchange Act"), a registration statement (as
amended, the "Exchange Act Registration Statement") on Form 8-A (File No. _____)
under the Exchange Act to register, under Section 12(b) of the Exchange Act, the
class of securities consisting of the Common Stock.
Prior to the date of this Agreement, each Selling Stockholder has
deposited such Selling Stockholder's Additional Shares under a custody agreement
in a form previously approved by the Representatives (such Selling Stockholder's
"Custody Agreement") with Computershare Limited, as custodian (the "Custodian").
Pursuant to a power of attorney granted by each Selling Stockholder in a form
previously approved by the Representatives (such Selling Stockholder's "Power of
Attorney"), ▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall act as representatives of
the Selling Stockholders. Each of the foregoing representatives (collectively,
the "Representatives of the Selling Stockholders") is authorized, on behalf of
each Selling Stockholder, among other things, to execute any documents necessary
or desirable in connection with the sale of the Additional Shares to be sold
hereunder by such Selling Stockholder, to make delivery of such Additional
Shares, to receive the proceeds of the sale of such Additional Shares, to give
receipts for such proceeds, to pay therefrom the expenses to be borne by such
Selling Stockholder in connection with the sale and public offering of the
Additional Shares, to distribute the balance of such proceeds to such Selling
Stockholder, to receive notices on behalf of such Selling Stockholder, to
instruct the Custodian under the Custody Agreements, and to take such other
action as may be necessary or desirable in connection with the transactions
contemplated by this Agreement. Anything in this Agreement to the contrary
notwithstanding, the Selling Stockholders acknowledge that the Underwriters are
not under any obligation to exercise their Over-Allotment Option (as defined
below) or purchase any Additional Shares.
The Company, each of the Selling Stockholders and the Underwriters
agree as follows:
1. Sale and Purchase. Upon the basis of the representations and warranties
and subject to the terms and conditions herein set forth, the Company agrees to
issue and sell to the respective Underwriters, and each of the Underwriters,
severally and not jointly, agrees to purchase from the Company, the respective
number of Firm Shares set forth opposite the name of such Underwriter in
Schedule A annexed hereto, subject to adjustment in accordance with Section 11
hereof in each case, at a purchase price of $__ per Share. The Company is
advised by you that the Underwriters intend (i) to make a public offering of
their respective portions of the Firm Shares as soon after the effective date of
the Registration Statement as in your judgment is advisable and (ii) initially
to offer the Firm Shares upon the terms set forth in the Prospectus. You may
from time to time increase or decrease the public offering price after the
initial public offering to such extent as you may determine.
In addition, the Company and the Selling Stockholders, in each case
severally and not jointly, hereby grant to the several Underwriters the option
(the "Over-Allotment Option") to purchase, and upon the basis of the
representations and warranties and subject to the terms and conditions herein
set forth, the Underwriters shall have the right to purchase, severally and not
-3-
jointly, from the Company and the Selling Stockholders, ratably in accordance
with the number of Firm Shares to be purchased by each of them, all or a portion
of the Additional Shares as may be necessary to cover over-allotments made in
connection with the offering of the Firm Shares, at the same purchase price per
share to be paid by the Underwriters to the Company for the Firm Shares. The
Over-Allotment Option may be exercised by the Representatives on behalf of the
several Underwriters at any time and from time to time on or before the
thirtieth day following the date of the Prospectus, by written notice to the
Company and the Selling Stockholders. Such notice shall set forth the aggregate
number of Additional Shares as to which the Over-Allotment Option is being
exercised and the date and time when the Additional Shares are to be delivered
(any such date and time being herein referred to as an "additional time of
purchase"); provided, however, that no additional time of purchase shall be
earlier than the "time of purchase" (as defined below), nor earlier than the
second business day after the date on which the Over-Allotment Option shall have
been exercised, nor later than the tenth business day after the date on which
the Over-Allotment Option shall have been exercised; and provided, further, that
such additional time of purchase may be on the same day as the time of purchase.
Upon each exercise of the Over-Allotment Option, subject to such adjustment as
the Representatives may determine to avoid fractional shares, and subject to
adjustment in accordance with Section 11 hereof: (a) no Additional Shares shall
be purchased from the Company unless prior thereto or in connection therewith
all Additional Shares offered by the Selling Stockholders as set forth in
Schedule C annexed hereto have been or are being purchased (or would have been
purchased but for a reason referred to in the last paragraph of Section 10), but
after all such Additional Shares offered by the Selling Stockholders have been
purchased (or would have been purchased but for a reason referred to in the last
paragraph of Section 10), then the balance of the Additional Shares to be
purchased in connection with such exercise of the Over-Allotment Option shall be
purchased from the Company; (b) the number of Additional Shares to be purchased
from each Selling Stockholder shall be in proportion to its respective number of
Additional Shares as set forth in Schedule C annexed hereto; and (c) the number
of Additional Shares to be purchased by each Underwriter, severally and not
jointly, shall be the number which bears the same proportion to the aggregate
number of Additional Shares to be purchased pursuant to such exercise of the
Over-Allotment Option as the number of Firm Shares set forth opposite the name
of such Underwriter in Schedule A annexed hereto bears to the total number of
Firm Shares.
2. Payment and Delivery. Payment of the purchase price for the Firm Shares
shall be made to the Company by Federal Funds wire transfer against delivery of
the certificates for the Firm Shares to you through the facilities of The
Depository Trust Company ("DTC") for the respective accounts of the
Underwriters. Such payment and delivery shall be made at 10:00 A.M., New York
City time, on _____, 2007 (unless another time shall be agreed to by you and the
Company, or unless postponed in accordance with the provisions of Section 11
hereof). The time at which such payment and delivery are to be made is
hereinafter sometimes called the "time of purchase." Electronic transfer of the
Firm Shares shall be made to you at the time of purchase in such names and in
such denominations as you shall specify.
Payment of the purchase price for any Additional Shares to be sold by
the Selling Stockholders shall be made to the Custodian on their behalf by
Federal Funds wire transfer against delivery of the certificates for such
Additional Shares to you through the facilities of DTC for the respective
accounts of the Underwriters. Such payment and delivery shall be made
-4-
at the applicable additional time of purchase in the same manner and at the same
office as the payment for the Firm Shares. Electronic transfer of such
Additional Shares shall be made to you at such additional time of purchase in
such names and in such denominations as you shall specify.
Payment of the purchase price for any Additional Shares to be sold by
the Company shall be made to the Company at the applicable additional time of
purchase in the same manner and at the same office as the payment for the Firm
Shares. Electronic transfer of such Additional Shares shall be made to you at
such additional time of purchase in such names and in such denominations as you
shall specify.
Deliveries of the documents described in Section 9 hereof with respect
to the purchase of the Shares shall be made at the offices of ▇▇▇▇▇ ▇▇▇▇ &
▇▇▇▇▇▇▇▇ at ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, at 9:00 A.M., New York
City time, on the date of the closing of the purchase of the Firm Shares or the
Additional Shares, as the case may be.
3. Representations and Warranties of the Company. The Company represents
and warrants to and agrees with each of the Underwriters that:
(a) the Registration Statement has been declared effective under the
Act or, with respect to any registration statement to be filed to register
the offer and sale of Shares pursuant to Rule 462(b) under the Act, will be
filed with the Commission and become effective under the Act no later than
10:00 P.M., New York City time, on the date of determination of the public
offering price for the Shares; no stop order of the Commission preventing
or suspending the use of any Preliminary Prospectus or Permitted Free
Writing Prospectus, or the effectiveness of the Registration Statement, has
been issued, and no proceedings for such purpose have been instituted or,
to the Company's knowledge, are contemplated by the Commission; the
Exchange Act Registration Statement has become effective as provided in
Section 12 of the Exchange Act;
(b) the Registration Statement complied when it became effective,
complies as of the date hereof and, as amended or supplemented, at the time
of purchase, each additional time of purchase, if any, and at all times
during which a prospectus is required by the Act to be delivered (whether
physically or through compliance with Rule 172 under the Act or any similar
rule) in connection with any sale of Shares, will comply, in all material
respects, with the requirements of the Act; the Registration Statement did
not, as of the Effective Time, contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; each Preliminary
Prospectus complied, at the time it was filed with the Commission, and
complies as of the date hereof, in all material respects with the
requirements of the Act; at no time during the period that begins on the
earlier of the date of such Preliminary Prospectus and the date such
Preliminary Prospectus was filed with the Commission and ends at the time
of purchase did or will any Preliminary Prospectus, as then amended or
supplemented, include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
and at no time during
-5-
such period did or will any Preliminary Prospectus, as then amended or
supplemented, together with any combination of one or more of the then
issued Permitted Free Writing Prospectuses, if any, include an untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; the Prospectus will comply, as
of its date, the date that it is filed with the Commission, the time of
purchase, each additional time of purchase, if any, and at all times during
which a prospectus is required by the Act to be delivered (whether
physically or through compliance with Rule 172 under the Act or any similar
rule) in connection with any sale of Shares, in all material respects, with
the requirements of the Act (including, without limitation, Section 10(a)
of the Act); at no time during the period that begins on the earlier of the
date of the Prospectus and the date the Prospectus is filed with the
Commission and ends at the later of the time of purchase, the latest
additional time of purchase, if any, and the end of the period during which
a prospectus is required by the Act to be delivered (whether physically or
through compliance with Rule 172 under the Act or any similar rule) in
connection with any sale of Shares did or will the Prospectus, as then
amended or supplemented, include an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; at no time during the period that begins on the date of such
Permitted Free Writing Prospectus and ends at the time of purchase did or
will any Permitted Free Writing Prospectus include an untrue statement of a
material fact or, together with the then-most recent Preliminary
Prospectus, omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that the Company makes no
representation or warranty with respect to any statement contained in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
Permitted Free Writing Prospectus in reliance upon and in conformity with
information concerning an Underwriter and furnished in writing by or on
behalf of such Underwriter through you to the Company expressly for use in
the Registration Statement, such Preliminary Prospectus, the Prospectus or
such Permitted Free Writing Prospectus;
(c) prior to the execution of this Agreement, the Company has not,
directly or indirectly, offered or sold any Shares by means of any
"prospectus" (within the meaning of the Act) or used any "prospectus"
(within the meaning of the Act) in connection with the offer or sale of the
Shares, in each case other than the Preliminary Prospectuses and the
Permitted Free Writing Prospectuses, if any; the Company has not, directly
or indirectly, prepared, used or referred to any Permitted Free Writing
Prospectus except in compliance with Rules 164 and 433 under the Act;
assuming that such Permitted Free Writing Prospectus is accompanied or
preceded by the most recent Preliminary Prospectus that contains a price
range or the Prospectus, as the case may be, and that such Permitted Free
Writing Prospectus is so sent or given after the Registration Statement was
filed with the Commission (and after such Permitted Free Writing Prospectus
was, if required pursuant to Rule 433(d) under the Act, filed with the
Commission), the sending or giving, by any Underwriter, of any Permitted
Free Writing Prospectus will satisfy the provisions of Rule 164 and Rule
433 (without reliance on subsections (b), (c) and (d) of Rule 164); the
Preliminary Prospectus dated _____, 2007 is a prospectus that, other than
-6-
by reason of Rule 433 or Rule 431 under the Act, satisfies the requirements
of Section 10 of the Act, including a price range where required by rule;
neither the Company nor the Underwriters are disqualified, by reason of
subsection (f) or (g) of Rule 164 under the Act, from using, in connection
with the offer and sale of the Shares, "free writing prospectuses" (as
defined in Rule 405 under the Act) pursuant to Rules 164 and 433 under the
Act; the Company is not an "ineligible issuer" (as defined in Rule 405
under the Act) as of the eligibility determination date for purposes of
Rules 164 and 433 under the Act with respect to the offering of the Shares
contemplated by the Registration Statement; the parties hereto agree and
understand that the content of any and all "road shows" (as defined in Rule
433 under the Act) related to the offering of the Shares contemplated
hereby is solely the property of the Company; the Company has caused there
to be made available at least one version of a "bona fide electronic road
show" (as defined in Rule 433 under the Act) in a manner that, pursuant to
Rule 433(d)(8)(ii) under the Act, causes the Company not to be required,
pursuant to Rule 433(d) under the Act, to file, with the Commission, any
Electronic Road Show;
(d) as of the date of this Agreement, the Company has an authorized
and outstanding capitalization as set forth in the sections of the
Registration Statement, the Preliminary Prospectuses and the Prospectus
entitled "Capitalization" and "Description of Capital Stock" (and any
similar sections or information, if any, contained in any Permitted Free
Writing Prospectus), and, as of the time of purchase and any additional
time of purchase, as the case may be, the Company shall have an authorized
and outstanding capitalization as set forth in the sections of the
Registration Statement, the Preliminary Prospectuses and the Prospectus
entitled "Capitalization" and "Description of Capital Stock" (and any
similar sections or information, if any, contained in any Permitted Free
Writing Prospectus) (subject, in each case, to the issuance of shares of
Common Stock upon exercise of stock options and warrants disclosed as
outstanding in the Registration Statement (excluding the exhibits thereto),
each Preliminary Prospectus and the Prospectus and the grant of options
under existing stock option plans described in the Registration Statement
(excluding the exhibits thereto), each Preliminary Prospectus and the
Prospectus); all of the issued and outstanding shares of capital stock,
including the Common Stock, of the Company have been duly authorized and
validly issued and are fully paid and non-assessable, have been issued in
compliance with all applicable securities laws and were not issued in
violation of any preemptive right, resale right, right of first refusal or
similar right (including any such right arising pursuant to any agreement
with Evolution ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Limited or any other agreement, obligation or
undertaking made by or on behalf of the Company in connection with the
admission of the Common Stock to trading on AIM, a market operated by the
London Stock Exchange (the "AIM")); no further approval or authority of the
stockholders or the board of directors of the Company are required for the
issuance and sale of the Shares; prior to the time of purchase, the Company
has duly effected and completed the Reincorporation in the manner described
in the Registration Statement (excluding the exhibits thereto), each
Preliminary Prospectus and the Prospectus; and the Certificate of
Incorporation of the Company and Bylaws of the Company, each in the form
filed as an exhibit to the Registration Statement, have been heretofore
duly authorized and approved in accordance with the Delaware General
Corporation Law and shall become effective and in full force
-7-
and effect at or before the time of purchase; the Shares are duly listed,
and admitted and authorized for trading, subject to official notice of
issuance and evidence of satisfactory distribution, on The Nasdaq Global
Market (the "NASDAQ");
(e) prior to the Reincorporation, the Company has been or was, as
applicable, duly incorporated and is or was, as applicable, validly
existing as a corporation in good standing under the New Jersey Business
Corporation Act, with full corporate power and authority to own, lease and
operate its properties and conduct its business as described in the
Registration Statement, each Preliminary Prospectus, the Prospectus and
each Permitted Free Writing Prospectus, if any, to execute and deliver this
Agreement and to issue, sell and deliver the Shares pursuant hereto as
contemplated herein; and from and after the Reincorporation, the Company
has or will have been, as applicable, duly incorporated and is or will be,
as applicable, validly existing as a corporation in good standing under the
General Corporation Law of the State of Delaware, with full corporate power
and authority to own, lease and operate its properties and conduct its
business as described in the Registration Statement, each Preliminary
Prospectus, the Prospectus and each Permitted Free Writing Prospectus, if
any, to execute and deliver this Agreement and to issue, sell and deliver
the Shares pursuant hereto as contemplated herein;
(f) the Company is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction where the
ownership or leasing of its properties or the conduct of its business
requires such qualification, except where the failure to be so qualified
and in good standing would not, individually or in the aggregate, either
(i) have a material adverse effect on the business, properties, financial
condition, results of operations, cash flows, management or prospects of
the Company and the Subsidiaries (as defined below) taken as a whole, (ii)
prevent or materially interfere with consummation of the transactions
contemplated hereby or result in any liability for any Underwriter or (iii)
prevent the shares of Common Stock from being accepted for listing on, or
result in the delisting of shares of Common Stock from the NASDAQ or AIM
(the occurrence of any such effect or any such prevention or interference
or any such result described in the foregoing clauses (i), (ii) and (iii)
being herein referred to as a "Material Adverse Effect");
(g) the Company has no subsidiaries (as defined under the Act) other
than those identified in Exhibit 21.1 to the Registration Statement
(collectively, the "Subsidiaries"); except as described in the Registration
Statement, each Preliminary Prospectus and the Prospectus, the Company owns
all of the issued and outstanding capital stock or other equity interests
of each of the Subsidiaries; other than the capital stock or other equity
interests of the Subsidiaries and except as described in the Registration
Statement, each Preliminary Prospectus and the Prospectus, the Company does
not own, directly or indirectly, any shares of stock or any other equity
interests or long-term debt securities of any corporation, firm,
partnership, joint venture, association or other entity; complete and
correct copies of the organizational documents and the bylaws of the
Company and each Subsidiary and all amendments thereto have been delivered
to you, and, except as set forth in the exhibits to the Registration
Statement, no changes therein will be made on or after the date hereof
through and including the time of
-8-
purchase or, if later, any additional time of purchase; each Subsidiary has
been duly incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation, with full
corporate power and authority to own, lease and operate its properties and
to conduct its business as described in the Registration Statement, each
Preliminary Prospectus, the Prospectus and each Permitted Free Writing
Prospectus, if any; each Subsidiary is duly qualified to do business as a
foreign corporation and is in good standing in each jurisdiction where the
ownership or leasing of its properties or the conduct of its business
requires such qualification, except where the failure to be so qualified
and in good standing would not, individually or in the aggregate, have a
Material Adverse Effect; all of the outstanding shares of capital stock of
each of the Subsidiaries have been duly authorized and validly issued, are
fully paid and non-assessable, have been issued in compliance with all
applicable securities laws, were not issued in violation of any preemptive
right, resale right, right of first refusal or similar right and, except as
described in the Registration Statement, each Preliminary Prospectus and
the Prospectus, are owned by the Company subject to no security interest,
other encumbrance or adverse claims; no options, warrants or other rights
to purchase, agreements or other obligations to issue or other rights to
convert any obligation into shares of capital stock or ownership interests
in the Subsidiaries are outstanding; the Company has no "significant
subsidiary," as that term is defined in Rule 1-02(w) of Regulation S-X
under the Act;
(h) the Shares to be sold by the Company pursuant hereto have been
duly and validly authorized and, when issued and delivered against payment
therefor as provided herein, will be duly and validly issued, fully paid
and non-assessable and free of statutory and contractual preemptive rights,
resale rights, rights of first refusal and similar rights (including any
such right arising pursuant to any agreement with Evolution ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Limited or any other agreement, obligation or undertaking made by or on
behalf of the Company in connection with the admission of the Common Stock
to trading on AIM); the Shares to be sold by the Company pursuant hereto,
when issued and delivered against payment therefor as provided herein, will
be free of any restriction upon the voting or transfer thereof pursuant to
the Company's charter or bylaws or any agreement or other instrument to
which the Company is a party; the Additional Shares to be sold by the
Selling Stockholders pursuant hereto have been duly and validly authorized
and issued and are and, after they are delivered against payment therefor
as provided herein, will be fully paid, non-assessable and free of
statutory and contractual preemptive rights, resale rights, rights of first
refusal and similar rights (including any such right arising pursuant to
any agreement with Evolution ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Limited or any other agreement,
obligation or undertaking made by or on behalf of the Company in connection
with the admission of the Common Stock to trading on AIM); the Additional
Shares to be sold by the Selling Stockholders pursuant hereto are and,
after they are delivered against payment therefor as provided herein, will
be free of any restriction upon the voting or transfer thereof pursuant to
the Company's charter or bylaws or any agreement or other instrument to
which the Company is a party;
(i) the capital stock of the Company, including the Shares, conforms
in all material respects to the description thereof, if any, contained in
the Registration
-9-
Statement, each Preliminary Prospectus, the Prospectus and each Permitted
Free Writing Prospectus, if any; and the certificates for the Shares are in
due and proper form;
(j) this Agreement has been duly authorized, executed and delivered by
the Company;
(k) neither the Company nor any of the Subsidiaries is in breach or
violation of or in default under (nor has any event occurred which, with
notice, lapse of time or both, would result in any breach or violation of,
constitute a default under or give the holder of any indebtedness (or a
person acting on such holder's behalf) the right to require the repurchase,
redemption or repayment of all or a part of such indebtedness under) (A)
its respective charter or bylaws, or (B) any indenture, mortgage, deed of
trust, bank loan or credit agreement or other evidence of indebtedness, or
any license, lease, contract or other agreement or instrument to which it
is a party or by which it or any of its properties may be bound or
affected, or (C) any federal, state, local or foreign law, regulation or
rule, or (D) any rule or regulation of any regulatory organization having
jurisdiction over the Company or its assets (including, without limitation,
the rules and regulations of the NASDAQ or AIM), or (E) any decree,
judgment or order applicable to it or any of its properties, except, with
respect to clauses (B), (C), (D) or (E), where such breach, violation or
default would not, individually or in the aggregate, have a Material
Adverse Effect;
(l) the execution, delivery and performance of this Agreement, the
issuance and sale of the Shares to be sold by the Company pursuant hereto,
the sale of the Additional Shares to be sold by the Selling Stockholders
pursuant hereto and the consummation of the transactions contemplated
hereby will not conflict with, result in any breach or violation of or
constitute a default under (nor constitute any event which, with notice,
lapse of time or both, would result in any breach or violation of,
constitute a default under or give the holder of any indebtedness (or a
person acting on such holder's behalf) the right to require the repurchase,
redemption or repayment of all or a part of such indebtedness under) (or
result in the creation or imposition of a lien, charge or encumbrance on
any property or assets of the Company or any Subsidiary pursuant to) (A)
the charter or bylaws of the Company or any of the Subsidiaries, or (B) any
indenture, mortgage, deed of trust, bank loan or credit agreement or other
evidence of indebtedness, or any license, lease, contract or other
agreement or instrument to which the Company or any of the Subsidiaries is
a party or by which any of them or any of their respective properties may
be bound or affected, or (C) any federal, state, local or foreign law,
regulation or rule, or (D) any rule or regulation of any regulatory
organization having jurisdiction over the Company or its assets (including,
without limitation, the rules and regulations of the NASDAQ or AIM), except
where such conflict, breach, violation or default would not, individually
or in the aggregate, have a Material Adverse Effect, or (E) any decree,
judgment or order applicable to the Company or any of the Subsidiaries or
any of their respective properties;
(m) no approval, authorization, consent or order of or filing with any
federal, state, local or foreign governmental or regulatory commission,
board, body, authority or
-10-
agency, or of or with any self-regulatory organization or other
non-governmental regulatory authority (including, without limitation, the
NASDAQ and AIM), is required in connection with the issuance and sale of
the Shares to be sold by the Company pursuant hereto, the sale of the
Additional Shares to be sold by the Selling Stockholders pursuant hereto or
the consummation of the transactions contemplated hereby, other than (i)
approval of the stockholders of the Company, which has been obtained, (ii)
registration of the Shares under the Act, which has been effected (or, with
respect to any registration statement to be filed hereunder pursuant to
Rule 462(b) under the Act, will be effected in accordance herewith), (iii)
any necessary qualification under the securities or blue sky laws of the
various jurisdictions in which the Shares are being offered by the
Underwriters, (iv) under the Conduct Rules of the National Association of
Securities Dealers, Inc. (the "NASD") or (v) admission of the Shares to
trading on AIM, which admission need not occur prior to or simultaneously
with the issuance and sale of the Shares;
(n) except as described in the Registration Statement (excluding the
exhibits thereto), each Preliminary Prospectus and the Prospectus, (i) no
person has the right, contractual or otherwise, to cause the Company to
issue or sell to it any shares of Common Stock or shares of any other
capital stock or other equity interests of the Company, (ii) no person has
any preemptive rights, resale rights, rights of first refusal or other
rights to purchase any shares of Common Stock or shares of any other
capital stock of or other equity interests in the Company (including any
such right arising pursuant to any agreement with Evolution ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Limited or any other agreement, obligation or undertaking made by or on
behalf of the Company in connection with the admission of the Common Stock
to trading on AIM) and (iii) no person has the right to act as an
underwriter or as a financial advisor to the Company in connection with the
offer and sale of the Shares, in the case of the foregoing clauses (i),
(ii) and (iii), whether as a result of the filing or effectiveness of the
Registration Statement or the sale of the Shares as contemplated thereby or
otherwise; no person has the right, contractual or otherwise, to cause the
Company to register under the Act any shares of Common Stock or shares of
any other capital stock of or other equity interests in the Company, or to
include any such shares or interests in the Registration Statement or the
offering contemplated thereby;
(o) each of the Company and the Subsidiaries has all necessary
licenses, authorizations, consents and approvals and has made all necessary
filings required under any federal, state, local or foreign law, regulation
or rule, and has obtained all necessary licenses, authorizations, consents
and approvals from other persons, in order to conduct their respective
businesses; neither the Company nor any of the Subsidiaries is in violation
of, or in default under, or has received notice of any proceedings relating
to revocation or modification of, any such license, authorization, consent
or approval or any federal, state, local or foreign law, regulation or rule
or any decree, order or judgment applicable to the Company or any of the
Subsidiaries, except where such violation, default, revocation or
modification would not, individually or in the aggregate, have a Material
Adverse Effect;
-11-
(p) there are no actions, suits, claims, investigations or proceedings
pending or, to the Company's knowledge, threatened or contemplated to which
the Company or any of the Subsidiaries or any of their respective directors
or officers is or would be a party or of which any of their respective
properties is or would be subject at law or in equity, before or by any
federal, state, local or foreign governmental or regulatory commission,
board, body, authority or agency, or before or by any other
non-governmental regulatory authority having jurisdiction over the Company
or its assets (including, without limitation, the NASDAQ and AIM), except
any such action, suit, claim, investigation or proceeding which, if
resolved adversely to the Company or any Subsidiary, would not,
individually or in the aggregate, have a Material Adverse Effect;
(q) KPMG LLP, whose report on the consolidated financial statements of
the Company and the Subsidiaries as of April 30, 2006 and April 30, 2005
and for the years then ended is included in the Registration Statement, the
Preliminary Prospectuses and the Prospectus, is an independent registered
public accounting firm as required by the Act and by the rules of the
Public Company Accounting Oversight Board; and Deloitte & Touche LLP, whose
report on the consolidated financial statements of the Company and the
Subsidiaries as of April 30, 2004 and for the year then ended is included
in the Registration Statement, the Preliminary Prospectuses and the
Prospectus, is an independent registered public accounting firm as required
by the Act and by the rules of the Public Company Accounting Oversight
Board;
(r) the financial statements included in the Registration Statement,
each Preliminary Prospectus, the Prospectus and each Permitted Free Writing
Prospectus, if any, together with the related notes and schedules, present
fairly the consolidated financial position of the Company and the
Subsidiaries as of the dates indicated and the consolidated results of
operations, cash flows and changes in stockholders' equity of the Company
for the periods specified and have been prepared in compliance with the
requirements of the Act and Exchange Act and in conformity with U.S.
generally accepted accounting principles applied on a consistent basis
during the periods involved; [all pro forma financial statements or data
included in the Registration Statement, each Preliminary Prospectus, the
Prospectus and each Permitted Free Writing Prospectus, if any, comply with
the requirements of the Act and the Exchange Act, and the assumptions used
in the preparation of such pro forma financial statements and data are
reasonable, the pro forma adjustments used therein are appropriate to give
effect to the transactions or circumstances described therein and the pro
forma adjustments have been properly applied to the historical amounts in
the compilation of those statements and data;](1) the other financial and
statistical data relating to the Company contained in the Registration
Statement, each Preliminary Prospectus, the Prospectus and each Permitted
Free Writing Prospectus, if any, are accurately and fairly presented and
prepared on a basis consistent with the financial statements and books and
records of the Company; there are no financial statements (historical or
pro forma) that are required to be included in the Registration Statement,
any Preliminary Prospectus or the Prospectus that are not included as
required; the Company and the Subsidiaries do not have any material
----------
(1) To be deleted if no pro formas are included.
-12-
liabilities or obligations, direct or contingent (including any off-balance
sheet obligations), not described in the Registration Statement (excluding
the exhibits thereto), each Preliminary Prospectus and the Prospectus; and
all disclosures contained in the Registration Statement, each Preliminary
Prospectus, the Prospectus and each Permitted Free Writing Prospectus, if
any, regarding "non-GAAP financial measures" (as such term is defined by
the rules and regulations of the Commission) comply with Regulation G of
the Exchange Act and Item 10 of Regulation S-K under the Act, to the extent
applicable;
(s) subsequent to the respective dates as of which information is
given in the Registration Statement, each Preliminary Prospectus, the
Prospectus and each Permitted Free Writing Prospectus, if any, in each case
excluding any amendments or supplements to the foregoing made after the
execution of this Agreement, there has not been (i) any material adverse
change, or any development involving a prospective material adverse change,
in the business, properties, financial condition, results of operations,
cash flows, management or prospects of the Company and the Subsidiaries
taken as a whole, (ii) any transaction which is material to the Company and
the Subsidiaries taken as a whole, (iii) any obligation or liability,
direct or contingent (including any off-balance sheet obligations),
incurred by the Company or any Subsidiary, which is material to the Company
and the Subsidiaries taken as a whole, (iv) any change in the capital stock
or outstanding indebtedness of the Company or any Subsidiaries or (v) any
dividend or distribution of any kind declared, paid or made on the capital
stock of the Company or any Subsidiary;
(t) the Company has obtained for the benefit of the Underwriters the
agreement (a "Lock-Up Agreement"), in the form set forth as Exhibit A
hereto, of each of its directors and "officers" (within the meaning of Rule
16a-1(f) under the Exchange Act), each Selling Stockholder and each other
person identified on Exhibit A-1 attached hereto;
(u) neither the Company nor any Subsidiary is, and at no time during
which a prospectus is required by the Act to be delivered (whether
physically or through compliance with Rule 172 under the Act or any similar
rule) in connection with any sale of Shares will either of them be, and,
solely after giving effect to the offering and sale of the Shares and the
application of the proceeds thereof as described in the Registration
Statement, each Preliminary Prospectus and the Prospectus, neither of them
will be, an "investment company" or an entity "controlled" by an
"investment company," as such terms are defined in the Investment Company
Act of 1940, as amended (the "Investment Company Act");
(v) the Company and each of the Subsidiaries have good and marketable
title to all property (real and personal) described in the Registration
Statement, each Preliminary Prospectus, the Prospectus and each Permitted
Free Writing Prospectus, if any, as being owned by any of them, free and
clear of all liens, claims, security interests or other encumbrances; all
the property described in the Registration Statement, each Preliminary
Prospectus, the Prospectus and each Permitted Free Writing Prospectus, if
-13-
any, as being held under lease by the Company or a Subsidiary is held
thereby under valid, subsisting and enforceable leases;
(w) the Company and the Subsidiaries own, or have obtained valid and
enforceable licenses for, or other rights to use, the inventions, patent
applications, patents, trademarks (both registered and unregistered),
tradenames, service names, copyrights, trade secrets and other proprietary
information described in the Registration Statement, each Preliminary
Prospectus, the Prospectus and each Permitted Free Writing Prospectus, if
any, as being owned or licensed by them or which are necessary for the
conduct of their respective businesses (including the commercialization of
products or services described in the Registration Statement, each
Preliminary Prospectus, the Prospectus and each Permitted Free Writing
Prospectus, if any, as under development), except where the failure to own,
license or have such rights would not, individually or in the aggregate,
have a Material Adverse Effect (collectively, "Intellectual Property"); (i)
there are no third parties who have or, to the Company's knowledge, will be
able to establish rights to any Intellectual Property, except for the
ownership rights of the owners of the Intellectual Property which the
Registration Statement (excluding the exhibits thereto), each Preliminary
Prospectus and the Prospectus disclose is licensed to the Company; (ii)
there is no infringement by third parties of any Intellectual Property;
(iii) there is no pending or, to the Company's knowledge, threatened
action, suit, proceeding or claim by others challenging the Company's
rights in or to any Intellectual Property, and the Company is unaware of
any facts which could form a reasonable basis for any such action, suit,
proceeding or claim; (iv) there is no pending or, to the Company's
knowledge, threatened action, suit, proceeding or claim by others
challenging the validity, enforceability or scope of any Intellectual
Property, and the Company is unaware of any facts which could form a
reasonable basis for any such action, suit, proceeding or claim; (v) there
is no pending or, to the Company's knowledge, threatened action, suit,
proceeding or claim by others that the Company or any Subsidiary infringes
or otherwise violates, or would, upon the commercialization of any product
or service described in the Registration Statement, each Preliminary
Prospectus, the Prospectus and each Permitted Free Writing Prospectus, if
any, as under development, infringe or violate, any patent, trademark,
tradename, service name, copyright, trade secret or other proprietary
rights of others, and the Company is unaware of any facts which could form
a reasonable basis for any such action, suit, proceeding or claim; (vi) the
Company and the Subsidiaries have complied with the terms of each agreement
pursuant to which Intellectual Property has been licensed to the Company or
any Subsidiary, and, to the Company's knowledge, all such agreements are in
full force and effect; (vii) to the Company's knowledge, there is no patent
or patent application that contains claims that interfere with the issued
or pending claims of any of the Intellectual Property or that adversely
affects the validity, enforceability or scope of any of the Intellectual
Property; and (viii) to the Company's knowledge, there is no prior art that
may render any patent application within the Intellectual Property
unpatentable that has not been disclosed to the U.S. Patent and Trademark
Office;
(x) neither the Company nor any of the Subsidiaries is engaged in any
unfair labor practice; except for matters which would not, individually or
in the aggregate, have
-14-
a Material Adverse Effect, (i) there is (A) no unfair labor practice
complaint pending or, to the Company's knowledge, threatened against the
Company or any of the Subsidiaries before the National Labor Relations
Board, and no grievance or arbitration proceeding arising out of or under
collective bargaining agreements is pending or, to the Company's knowledge,
threatened, (B) no strike, labor dispute, slowdown or stoppage pending or,
to the Company's knowledge, threatened against the Company or any of the
Subsidiaries and (C) no union representation dispute currently existing
concerning the employees of the Company or any of the Subsidiaries, (ii) to
the Company's knowledge, no union organizing activities are currently
taking place concerning the employees of the Company or any of the
Subsidiaries and (iii) there has been no violation of any federal, state,
local or foreign law relating to discrimination in the hiring, promotion or
pay of employees, any applicable wage or hour laws or any provision of the
Employee Retirement Income Security Act of 1974 ("ERISA") or the rules and
regulations promulgated thereunder concerning the employees of the Company
or any of the Subsidiaries;
(y) the Company and the Subsidiaries and their respective properties,
assets and operations are in compliance with, and the Company and the
Subsidiaries hold all permits, authorizations and approvals required under,
Environmental Laws (as defined below), except to the extent that failure to
so comply or to hold such permits, authorizations or approvals would not,
individually or in the aggregate, have a Material Adverse Effect; there are
no past, present or, to the Company's knowledge, reasonably anticipated
future events, conditions, circumstances, activities, practices, actions,
omissions or plans that could reasonably be expected to give rise to any
material costs or liabilities to the Company or any Subsidiary under, or to
interfere with or prevent compliance by the Company or any Subsidiary with,
Environmental Laws; except as would not, individually or in the aggregate,
have a Material Adverse Effect, neither the Company nor any of the
Subsidiaries (i) is the subject of any investigation, (ii) has received any
notice or claim, (iii) is a party to or affected by any pending or, to the
Company's knowledge, threatened action, suit or proceeding, (iv) is bound
by any judgment, decree or order or (v) has entered into any agreement, in
each case relating to any alleged violation of any Environmental Law or any
actual or alleged release or threatened release or cleanup at any location
of any Hazardous Materials (as defined below) (as used herein,
"Environmental Law" means any federal, state, local or foreign law,
statute, ordinance, rule, regulation, order, decree, judgment, injunction,
permit, license, authorization or other binding requirement, or common law,
relating to health, safety or the protection, cleanup or restoration of the
environment or natural resources, including those relating to the
distribution, processing, generation, treatment, storage, disposal,
transportation, other handling or release or threatened release of
Hazardous Materials, and "Hazardous Materials" means any material
(including, without limitation, pollutants, contaminants, hazardous or
toxic substances or wastes) that is regulated by or may give rise to
liability under any Environmental Law);
(z) in the ordinary course of its business, the Company evaluates the
effect of the Environmental Laws on the Company's and its subsidiaries'
businesses, operations and properties and the associated costs and
liabilities (including, without limitation, any capital or operating
expenditures required for cleanup, closure of properties or
-15-
compliance with the Environmental Laws or any permit, license or approval,
any related constraints on operating activities and any potential
liabilities to third parties);
(aa) all tax returns required to be filed by the Company or any of the
Subsidiaries have been timely filed (within the time extensions permitted
by the relevant tax authorities), and all taxes and other assessments of a
similar nature (whether imposed directly or through withholding) including
any interest, additions to tax or penalties applicable thereto due or
claimed to be due from such entities have been timely paid, other than
those being contested in good faith and for which adequate reserves have
been provided and except where the failure to file such returns or to pay
such taxes would not, individually or in the aggregate, have a Material
Adverse Effect;
(bb) the Company maintains insurance covering its properties,
operations, personnel and businesses as the Company reasonably deems
adequate; such insurance insures against such losses and risks to an extent
which is adequate in accordance with customary industry practice to protect
the Company and the Subsidiaries and their respective businesses; all such
insurance is fully in force on the date hereof and will be fully in force
at the time of purchase and each additional time of purchase, if any;
neither the Company nor any Subsidiary has reason to believe that it will
not be able to renew any such insurance as and when such insurance expires;
(cc) neither the Company nor any Subsidiary has sent or received any
communication regarding termination of, or intent not to renew, any of the
contracts or agreements filed or required to be filed as an exhibit to the
Registration Statement, and no such termination or non-renewal has been
threatened by the Company or any Subsidiary or, to the Company's knowledge,
any other party to any such contract or agreement;
(dd) the Company and each of the Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance
that (i) transactions are executed in accordance with management's general
or specific authorization; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences;
(ee) the Company has established and maintains and evaluates
"disclosure controls and procedures" (as such term is defined in Rule
13a-15 and 15d-15 under the Exchange Act) and "internal control over
financial reporting" (as such term is defined in Rule 13a-15 and 15d-15
under the Exchange Act); such disclosure controls and procedures are
designed to ensure that material information relating to the Company,
including its consolidated subsidiaries, is made known to the Company's
Chief Executive Officer and its Chief Financial Officer by others within
those entities, and such disclosure controls and procedures are effective
to perform the functions for which they were established; the Company's
independent auditors and the Audit Committee of the Board of Directors of
the Company have been advised of: (i) all significant deficiencies, if any,
-16-
in the design or operation of internal controls which could adversely
affect the Company's ability to record, process, summarize and report
financial data; and (ii) all fraud, if any, whether or not material, that
involves management or other employees who have a role in the Company's
internal controls; no material weaknesses in internal controls in any of
the periods covered by the audited financial statements included in the
Registration Statement, any Preliminary Prospectus or the Prospectus have
been identified to the Company's independent auditors; except as disclosed
in the Registration Statement, each Preliminary Prospectus and the
Prospectus, since the third anniversary preceding the date of the Company's
most recent audited balance sheet, there has been no material weaknesses in
the Company's internal control over financial reporting (whether or not
remediated) and no occurrences of fraud, whether or not material, that
involve management or other employees who have a role in the Company's
internal controls; since the date of the most recent evaluation of such
disclosure controls and procedures and internal controls, there have been
no significant changes in internal controls or in other factors that could
significantly affect internal controls, including any corrective actions
with regard to significant deficiencies and material weaknesses; and the
Company has taken all necessary actions to ensure that, upon and at all
times after the filing of the Registration Statement, the Company and the
Subsidiaries and their respective officers and directors, in their
capacities as such, will be in compliance in all material respects with the
applicable provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 (the
"▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act") and the rules and regulations promulgated thereunder;
(ff) each "forward-looking statement" (within the meaning of Section
27A of the Act or Section 21E of the Exchange Act) contained in the
Registration Statement, each Preliminary Prospectus, the Prospectus and
each Permitted Free Writing Prospectus, if any, has been made or reaffirmed
with a reasonable basis and in good faith;
(gg) all statistical or market-related data included in the
Registration Statement, each Preliminary Prospectus, the Prospectus and
each Permitted Free Writing Prospectus, if any, are based on or derived
from sources that the Company reasonably believes to be reliable and
accurate, and the Company has obtained the written consent to the use of
such data from such sources to the extent required;
(hh) neither the Company nor any of the Subsidiaries nor, to the
Company's knowledge, any employee or agent of the Company or any Subsidiary
has made any payment of funds of the Company or any Subsidiary or received
or retained any funds in violation of (or which, if the Company were
subject to the reporting obligations of the Exchange Act, would be a
violation of) the Foreign Corrupt Practices Act of 1977;
(ii) to the knowledge of the Company, the operations of the Company
and the Subsidiaries are and have been conducted at all times in compliance
with applicable financial recordkeeping and reporting requirements of the
Currency and Foreign Transactions Reporting Act of 1970, as amended, the
money laundering statutes of all jurisdictions, the rules and regulations
thereunder and any related or similar rules, regulations or guidelines,
issued, administered or enforced by any governmental agency (collectively,
the "Money Laundering Laws"); and no action, suit or proceeding by or
-17-
before any court or governmental agency, authority or body or any
arbitrator or non-governmental authority involving the Company or any of
the Subsidiaries with respect to the Money Laundering Laws is pending or,
to the Company's knowledge, threatened;
(jj) no Subsidiary is currently prohibited, directly or indirectly,
from paying any dividends to the Company, from making any other
distribution on such Subsidiary's capital stock, from repaying to the
Company any loans or advances to such Subsidiary from the Company or from
transferring any of such Subsidiary's property or assets to the Company or
any other Subsidiary of the Company, except as disclosed in the
Registration Statement (excluding the exhibits thereto), each Preliminary
Prospectus and the Prospectus;
(kk) the issuance and sale of the Shares to be sold by the Company and
the sale of the Additional Shares to be sold by the Selling Stockholders as
contemplated hereby will not cause any holder of any shares of capital
stock, securities convertible into or exchangeable or exercisable for
capital stock or options, warrants or other rights to purchase capital
stock or any other securities of the Company (including any such right
arising pursuant to any agreement with Evolution ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Limited or
any other agreement, obligation or undertaking made by or on behalf of the
Company in connection with the admission of the Common Stock to trading on
AIM) to have any right to acquire any shares of capital stock of the
Company;
(ll) except pursuant to this Agreement, neither the Company nor any of
the Subsidiaries has incurred any liability for any finder's or broker's
fee or agent's commission in connection with the execution and delivery of
this Agreement or the consummation of the transactions contemplated hereby
or by the Registration Statement;
(mm) neither the Company nor any of the Subsidiaries nor any of their
respective directors, officers, affiliates or controlling persons has
taken, directly or indirectly, any action designed, or which has
constituted or might reasonably be expected to cause or result in the
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Shares;
(nn) to the Company's knowledge, there are no affiliations or
associations between (i) any member of the NASD and (ii) the Company or any
of the Company's officers, directors or 5% or greater security holders, or
any beneficial owner of the Company's unregistered equity securities that
were acquired at any time on or after the 180th day immediately preceding
the date the Registration Statement was initially filed with the
Commission, except as disclosed in the Registration Statement (excluding
the exhibits thereto), the Preliminary Prospectuses and the Prospectus; and
(oo) the Reincorporation of the Company from a corporation organized
under the laws of the State of New Jersey to a corporation organized under
the laws of the State of Delaware as described in the Registration
Statement, each Preliminary Prospectus, the Prospectus and each Permitted
Free Writing Prospectus, if any, has been duly authorized by the Company
and its stockholders and will be effective at or prior to the time of
purchase; except as described in the Registration Statement, each
Preliminary Prospectus,
-18-
the Prospectus and each Permitted Free Writing Prospectus, the
Reincorporation will have no adverse effect on the business, properties,
financial condition, results of operations, cash flows, management or
prospects of the Company and the Subsidiaries taken as a whole; all
consents, approvals, authorizations and orders necessary for the
Reincorporation have been obtained, except for such consents, approvals,
authorizations and orders that, if not obtained, would not, individually or
in the aggregate, have a Material Adverse Effect; and no stockholder of the
Company has any appraisal rights, dissenters' rights, repurchase rights,
redemption rights or similar rights in connection with the Reincorporation.
In addition, any certificate signed by any officer of the Company or
any of the Subsidiaries and delivered to the Underwriters or counsel for the
Underwriters in connection with the offering of the Shares shall be deemed to be
a representation and warranty by the Company, as to matters covered thereby, to
each Underwriter.
4. Representations and Warranties of the Selling Stockholders. Each
Selling Stockholder represents and warrants to each of the Underwriters that:
(a) the Registration Statement complied when it became effective,
complies as of the date hereof and, as amended or supplemented, at the time
of purchase, each additional time of purchase, if any, and at all times
during which a prospectus is required by the Act to be delivered (whether
physically or through compliance with Rule 172 under the Act or any similar
rule) in connection with any sale of Shares, will comply, in all material
respects, with the requirements of the Act; the Registration Statement did
not, as of the Effective Time, contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; each Preliminary
Prospectus complied, at the time it was filed with the Commission, and
complies as of the date hereof, in all material respects with the
requirements of the Act; at no time during the period that begins on the
earlier of the date of such Preliminary Prospectus and the date such
Preliminary Prospectus was filed with the Commission and ends at the time
of purchase did or will any Preliminary Prospectus, as then amended or
supplemented, include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
and at no time during such period did or will any Preliminary Prospectus,
as then amended or supplemented, together with any combination of one or
more of the then issued Permitted Free Writing Prospectuses, if any,
include an untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; the Prospectus
will comply, as of its date, the date that it is filed with the Commission,
the time of purchase, each additional time of purchase, if any, and at all
times during which a prospectus is required by the Act to be delivered
(whether physically or through compliance with Rule 172 under the Act or
any similar rule) in connection with any sale of Shares, in all material
respects, with the requirements of the Act (including, without limitation,
Section 10(a) of the Act); at no time during the period that begins on the
earlier of the date of the Prospectus and the date the Prospectus is filed
with the Commission and ends at the later
-19-
of the time of purchase, the latest additional time of purchase, if any,
and the end of the period during which a prospectus is required by the Act
to be delivered (whether physically or through compliance with Rule 172
under the Act or any similar rule) in connection with any sale of Shares
did or will the Prospectus, as then amended or supplemented, include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; at no time during
the period that begins on the date of such Permitted Free Writing
Prospectus and ends at the time of purchase did or will any Permitted Free
Writing Prospectus include an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading; provided, however, that such Selling Stockholder makes no
representation or warranty in this paragraph 4(a) with respect to any
statement contained in the Registration Statement, any Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus in
reliance upon and in conformity with information concerning an Underwriter
and furnished in writing by or on behalf of such Underwriter through you to
the Company expressly for use in the Registration Statement, such
Preliminary Prospectus, the Prospectus or such Permitted Free Writing
Prospectus; and provided, further, that as to the Selling Stockholder
identified on Schedule C annexed hereto as the Non-Management Stockholder,
the representation and warranty contained in this paragraph 4(a) shall be
limited to information, statements or omissions relating to such
Non-Management Stockholder.
(b) such Selling Stockholder has not, prior to the execution of this
Agreement, offered or sold any Shares by means of any "prospectus" (within
the meaning of the Act), or used any "prospectus" (within the meaning of
the Act) in connection with the offer or sale of the Shares, in each case
other than the then most recent Preliminary Prospectus;
(c) neither the execution, delivery and performance of this Agreement
or the Custody Agreement or Power of Attorney to which such Selling
Stockholder is a party nor the sale by such Selling Stockholder of the
Additional Shares to be sold by such Selling Stockholder pursuant to this
Agreement nor the consummation of the transactions contemplated hereby or
thereby will conflict with, result in any breach or violation of or
constitute a default under (or constitute any event which with notice,
lapse of time or both would result in any breach or violation of or
constitute a default under) (i) any indenture, mortgage, deed of trust,
bank loan or credit agreement or other evidence of indebtedness, or any
license, lease, contract or other agreement or instrument to which such
Selling Stockholder is a party or by which such Selling Stockholder or any
of its properties may be bound or affected, (ii) any federal, state, local
or foreign law, regulation or rule, (iii) or any rule or regulation of any
self-regulatory organization or other non-governmental regulatory authority
(including, without limitation, the rules and regulations of the NASDAQ),
or (iv) any decree, judgment or order applicable to such Selling
Stockholder or any of its properties;
(d) no approval, authorization, consent or order of or filing with any
federal, state, local or foreign governmental or regulatory commission,
board, body, authority or
-20-
agency, or of or with any self-regulatory organization or other
non-governmental regulatory authority (including, without limitation, the
NASDAQ and AIM), is required in connection with the sale of the Additional
Shares to be sold by such Selling Stockholder pursuant to this Agreement or
the consummation by such Selling Stockholder of the transactions
contemplated hereby or by the Custody Agreement or Power of Attorney to
which such Selling Stockholder is a party other than (i) registration of
the Shares under the Act, which has been effected (or, with respect to any
registration statement to be filed hereunder pursuant to Rule 462(b) under
the Act, will be effected in accordance herewith), (ii) any necessary
qualification under the securities or blue sky laws of the various
jurisdictions in which the Shares are being offered by the Underwriters,
(iii) under the Conduct Rules of the NASD or (iv) admission of the Shares
to trading on AIM, which admission need not occur prior to or
simultaneously with the issuance and sale of the Shares;
(e) neither such Selling Stockholder nor any of its affiliates has
taken, directly or indirectly, any action designed to, or which has
constituted or might reasonably be expected to cause or result in the
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Shares;
(f) there are no affiliations or associations between any member of
the NASD and such Selling Stockholder, except as disclosed in the
Registration Statement (excluding the exhibits thereto), each Preliminary
Prospectus and the Prospectus; none of the proceeds received by such
Selling Stockholder from the sale of the Additional Shares to be sold by
such Selling Stockholder pursuant to this Agreement will be paid to a
member of the NASD or any affiliate of (or person "associated with," as
such terms are used in the Rules of the NASD) such member;
(g) such Selling Stockholder now is and, at the time of delivery of
such Additional Shares (at each additional time of purchase), will be the
lawful owner of the number of Additional Shares to be sold by such Selling
Stockholder pursuant to this Agreement and has and, at the time of delivery
of such Additional Shares, will have valid and marketable title to such
Additional Shares, and upon delivery of and payment for such Additional
Shares (at each additional time of purchase), the Underwriters will acquire
valid and marketable title to such Additional Shares free and clear of any
claim, lien, encumbrance, security interest, community property right,
restriction on transfer or other defect in title;
(h) such Selling Stockholder has and, at the time of delivery of the
Additional Shares to be sold by such Selling Stockholder pursuant to this
Agreement (at each additional time of purchase), will have full legal
right, power and capacity, and all authorizations and approvals required by
law (other than those imposed by the Act and state securities or blue sky
laws), to (i) enter into this Agreement and a Custody Agreement and to
execute a Power of Attorney, (ii) sell, assign, transfer and deliver the
Additional Shares to be sold by such Selling Stockholder pursuant to this
Agreement in the manner provided in this Agreement and (iii) make the
representations, warranties and agreements made by such Selling Stockholder
herein;
-21-
(i) this Agreement, the Custody Agreement and the Power of Attorney to
which such Selling Stockholder is a party have each been duly executed and
delivered by (or, in the case of this Agreement, on behalf of) such Selling
Stockholder, and each is a legal, valid and binding agreement of such
Selling Stockholder enforceable in accordance with its terms;
(j) such Selling Stockholder has duly and irrevocably authorized each
of the Representatives of the Selling Stockholders (whether acting alone or
together), on behalf of such Selling Stockholder, to execute and deliver
this Agreement and any other documents necessary or desirable in connection
with the transactions contemplated hereby or thereby and to deliver the
Additional Shares to be sold by such Selling Stockholder pursuant to this
Agreement and receive payment therefor pursuant hereto;
(k) the sale of the Additional Shares to be sold by such Selling
Stockholder pursuant to this Agreement is not prompted by any information
concerning the Company or any Subsidiary which is not set forth in the
Registration Statement (excluding the exhibits thereto), each Preliminary
Prospectus and the Prospectus;
(l) at each additional time of purchase, all stock transfer or other
taxes (other than income taxes), if any, that are required to be paid in
connection with the sale and transfer of the Additional Shares to be sold
by such Selling Stockholder to the several Underwriters hereunder will be
fully paid or provided for by such Selling Stockholder, and all laws
imposing such taxes will be fully complied with;
(m) pursuant to the Custody Agreement to which such Selling
Stockholder is a party, certificates in negotiable form for the Additional
Shares to be sold by such Selling Stockholder pursuant to this Agreement
have been placed in custody for the purpose of making delivery of such
Additional Shares in accordance with this Agreement; such Selling
Stockholder agrees that (i) such Additional Shares represented by such
certificates are for the benefit of, and coupled with and subject to the
interest of, the Custodian, the Representatives of the Selling
Stockholders, the Underwriters and the Company, (ii) the arrangements made
by such Selling Stockholder for custody and for the appointment of the
Custodian and the Representatives of the Selling Stockholders by such
Selling Stockholder are irrevocable, and (iii) the obligations of such
Selling Stockholder hereunder shall not be terminated by operation of law,
whether by the death, disability or incapacity of such Selling Stockholder
(or, if such Selling Stockholder is not an individual, the liquidation,
dissolution, merger or consolidation of such Selling Stockholder) or the
occurrence of any other event (each, an "Event"); if an Event occurs before
the delivery of the Additional Shares hereunder, certificates for the
Additional Shares shall be delivered by the Custodian in accordance with
the terms and conditions of the Power of Attorney to which such Selling
Stockholder is a party, the Custody Agreement to which such Selling
Stockholder is a party and this Agreement, and actions taken by the
Custodian and the Representatives of the Selling Stockholders pursuant to
such Power or Attorney or such Custody Agreement shall be as valid as if
such Event had
-22-
not occurred, regardless of whether or not the Custodian or the
Representatives of the Selling Stockholders, or either of them, shall have
received notice thereof;
(n) such Selling Stockholder does not have any registration or other
similar rights to have any equity or debt securities of the Company
registered for sale by the Company under the Registration Statement or
included in the offering of the Shares, except for such rights as have been
waived or which are described in the Registration Statement, each
Preliminary Prospectus and the Prospectus (and which have been complied
with); and
(o) such Selling Stockholder does not have, or has waived prior to the
date hereof, any preemptive right, co-sale right or right of first refusal
or other similar right to purchase any of the Shares that are to be sold by
the Company or any other Selling Stockholder to the Underwriters pursuant
to this Agreement; and such Selling Stockholder does not own any warrants,
options or similar rights to acquire, and does not have any right or
arrangement to acquire, any capital stock, right, warrants, options or
other securities from the Company, other than those described in the
Registration Statement, each Preliminary Prospectus and the Prospectus.
In addition, any certificate signed by any Selling Stockholder or by
any Representative of the Selling Stockholders and delivered to the Underwriters
or counsel for the Underwriters in connection with the offering of the Shares
shall be deemed to be a representation and warranty by such Selling Stockholder,
as to matters covered thereby, to each Underwriter.
5. Certain Covenants of the Company. The Company hereby agrees:
(a) to furnish such information as may be required and otherwise to
cooperate in qualifying the Shares for offering and sale under the
securities or blue sky laws of such states or other jurisdictions as you
may designate and to maintain such qualifications in effect so long as you
may request for the distribution of the Shares; provided, however, that the
Company shall not be required to qualify as a foreign corporation or to
consent to the service of process under the laws of any such jurisdiction
(except service of process with respect to the offering and sale of the
Shares); and to promptly advise you of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Shares for offer or sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose;
(b) to make available to the Underwriters in New York City, as soon as
practicable after this Agreement becomes effective, and thereafter from
time to time to furnish to the Underwriters, as many copies of the
Prospectus (or of the Prospectus as amended or supplemented if the Company
shall have made any amendments or supplements thereto after the effective
date of the Registration Statement) as the Underwriters may request for the
purposes contemplated by the Act; in case any Underwriter is required to
deliver (whether physically or through compliance with Rule 172 under the
Act or any similar rule), in connection with the sale of the Shares, a
prospectus after the nine-month period referred to in Section 10(a)(3) of
the Act, the
-23-
Company will prepare, at its expense, promptly upon request such amendment
or amendments to the Registration Statement and the Prospectus as may be
necessary to permit compliance with the requirements of Section 10(a)(3) of
the Act;
(c) if, at the time this Agreement is executed and delivered, it is
necessary for a post-effective amendment to the Registration Statement, or
a Registration Statement under Rule 462(b) under the Act, to be filed with
the Commission and become effective before the Shares may be sold, the
Company will use its best efforts to cause such post-effective amendment or
such Registration Statement to be filed and become effective, and will pay
any applicable fees in accordance with the Act, as soon as possible; and
the Company will advise you promptly and, if requested by you, will confirm
such advice in writing, (i) when such post-effective amendment or such
Registration Statement has become effective, and (ii) if Rule 430A under
the Act is used, when the Prospectus is filed with the Commission pursuant
to Rule 424(b) under the Act (which the Company agrees to file in a timely
manner in accordance with such Rules);
(d) to advise you promptly, confirming such advice in writing, of any
request by the Commission for amendments or supplements to the Registration
Statement or the Exchange Act Registration Statement, any Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus or for
additional information with respect thereto, or of notice of institution of
proceedings for, or the entry of a stop order, suspending the effectiveness
of the Registration Statement and, if the Commission should enter a stop
order suspending the effectiveness of the Registration Statement, to use
its best efforts to obtain the lifting or removal of such order as soon as
possible; to advise you promptly of any proposal to amend or supplement the
Registration Statement or the Exchange Act Registration Statement, any
Preliminary Prospectus or the Prospectus, and to provide you and
Underwriters' counsel copies of any such documents for review and comment a
reasonable amount of time prior to any proposed filing and to file no such
amendment or supplement to which you shall object in writing;
(e) to file promptly all reports and documents and any preliminary or
definitive proxy or information statement required to be filed by the
Company with the Commission in order to comply with the Exchange Act for so
long as a prospectus is required by the Act to be delivered (whether
physically or through compliance with Rule 172 under the Act or any similar
rule) in connection with any sale of Shares; and to provide you with a copy
of such reports and statements and other documents to be filed by the
Company pursuant to Section 13, 14 or 15(d) of the Exchange Act during such
period a reasonable amount of time prior to any proposed filing and, except
as reasonably determined by Company counsel to be required by law, to file
no such report, statement or document to which you shall have objected in
writing;
(f) to advise the Underwriters promptly of the happening of any event
within the period during which a prospectus is required by the Act to be
delivered (whether physically or through compliance with Rule 172 under the
Act or any similar rule) in connection with any sale of Shares, which event
could require the making of any change in the Prospectus then being used so
that the Prospectus would not include an untrue
-24-
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they are made, not misleading, and to advise the Underwriters
promptly if, during such period, it shall become necessary to amend or
supplement the Prospectus to cause the Prospectus to comply with the
requirements of the Act, and, in each case, during such time, subject to
Section 5(d) hereof, to prepare and furnish, at the Company's expense, to
the Underwriters promptly such amendments or supplements to such Prospectus
as may be necessary to reflect any such change or to effect such
compliance;
(g) to make generally available to its security holders, and to
deliver to you (if not available on the Commission's Electronic Data
Gathering, Analysis and Retrieval system ("▇▇▇▇▇")), an earnings statement
of the Company (which will satisfy the provisions of Section 11(a) of the
Act) covering a period of twelve months beginning after the effective date
of the Registration Statement (as defined in Rule 158(c) under the Act) as
soon as is reasonably practicable after the termination of such
twelve-month period but in any case not later than the first date by which
the Company is required to file with the Commission a Quarterly Report on
Form 10-Q or Annual Report on Form 10-K that is required to include
financial statements covering a period that includes the last month of such
twelve-month period;
(h) to furnish to you five copies of the Registration Statement, as
initially filed with the Commission, and of all amendments thereto
(including all exhibits thereto) and sufficient copies of the foregoing
(other than exhibits) for distribution of a copy to each of the other
Underwriters, provided, however, that the Company shall not be required to
furnish any materials pursuant to this clause (h) if such materials are
available on ▇▇▇▇▇;
(i) to furnish to you as early as practicable prior to the time of
purchase and any additional time of purchase, as the case may be, but not
later than two business days prior thereto, a copy of the latest available
unaudited interim and monthly consolidated financial statements, if any, of
the Company and the Subsidiaries which have been read by the Company's
independent registered public accountants, as stated in the letter of KPMG
LLP to be furnished pursuant to Section 9(c) hereof;
(j) to apply the net proceeds to the Company from the sale of the
Shares in the manner set forth under the caption "Use of Proceeds" in the
Prospectus and to file such reports with the Commission with respect to the
sale of the Shares and the application of the proceeds therefrom as may be
required by Rule 463 under the Act;
(k) to comply with Rule 433(d) under the Act (without reliance on Rule
164(b) under the Act) and with Rule 433(g) under the Act;
(l) beginning on the date hereof and ending on, and including, the
date that is 180 days after the date hereof (the "Lock-Up Period"), without
the prior written consent of the Representatives, not to (i) issue, sell,
offer to sell, contract or agree to sell, hypothecate, pledge, grant any
option to purchase or otherwise dispose of or agree to dispose of, directly
or indirectly, or establish or increase a put equivalent position or
-25-
liquidate or decrease a call equivalent position within the meaning of
Section 16 of the Exchange Act and the rules and regulations of the
Commission promulgated thereunder, with respect to, any Common Stock or any
other securities of the Company that are substantially similar to Common
Stock, or any securities convertible into or exchangeable or exercisable
for, or any warrants or other rights to purchase, the foregoing, (ii) file
or cause to become effective a registration statement under the Act
relating to the offer and sale of any Common Stock or any other securities
of the Company that are substantially similar to Common Stock, or any
securities convertible into or exchangeable or exercisable for, or any
warrants or other rights to purchase, the foregoing, (iii) enter into any
swap or other arrangement that transfers to another, in whole or in part,
any of the economic consequences of ownership of Common Stock or any other
securities of the Company that are substantially similar to Common Stock,
or any securities convertible into or exchangeable or exercisable for, or
any warrants or other rights to purchase, the foregoing, whether any such
transaction is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise or (iv) publicly announce an intention to
effect any transaction specified in clause (i), (ii) or (iii), except, in
each case, for (A) the offer and sale of the Shares as contemplated by this
Agreement, (B) issuances of Common Stock upon the exercise of options or
warrants disclosed as outstanding in the Registration Statement (excluding
the exhibits thereto), each Preliminary Prospectus and the Prospectus, and
(C) the issuance of employee stock options not exercisable during the
Lock-Up Period pursuant to stock option plans described in the Registration
Statement (excluding the exhibits thereto), each Preliminary Prospectus and
the Prospectus; and (D) the issuance of Common Stock or any securities
convertible into or exchangeable or exercisable for, or any warrants or
other rights to purchase the foregoing, in connection with any transaction
that includes a strategic relationship (including joint ventures,
development or construction agreements, marketing or distribution
arrangements or intellectual property license agreements) or any
acquisition of assets or acquisition of a majority or controlling portion
of the equity of another entity, so long as the recipient of any Common
Stock, securities or warrants issued pursuant to this clause (D) executes
and delivers to the Representatives a Lock-Up Agreement and the aggregate
amount of Common Stock, securities and warrants issued pursuant to this
clause (D), on an as-converted, as-exchanged and as-exercised basis, as
applicable, does not exceed 5% of the outstanding shares of Common Stock of
the Company after giving effect to the issuance of sale of the Firm Shares;
provided, however, that if (a) during the period that begins on the date
that is fifteen (15) calendar days plus three (3) business days before the
last day of the Lock-Up Period and ends on the last day of the Lock-Up
Period, the Company issues an earnings release or material news or a
material event relating to the Company occurs; or (b) prior to the
expiration of the Lock-Up Period, the Company announces that it will
release earnings results during the sixteen (16) day period beginning on
the last day of the Lock-Up Period, then the restrictions imposed by this
Section 5(l) shall continue to apply until the expiration of the date that
is fifteen (15) calendar days plus three (3) business days after the date
on which the issuance of the earnings release or the material news or
material event occurs;
(m) prior to the time of purchase or any additional time of purchase,
as the case may be, and except as required by law or any rule or regulation
of NASDAQ or
-26-
AIM, to issue no press release or other communication directly or
indirectly and hold no press conferences with respect to the Company or any
Subsidiary, the financial condition, results of operations, business,
properties, assets, or liabilities of the Company or any Subsidiary, or the
offering of the Shares, without your prior consent, which consent shall not
be unreasonably withheld or delayed;
(n) not, at any time at or after the execution of this Agreement, to
offer or sell any Shares by means of any "prospectus" (within the meaning
of the Act), or use any "prospectus" (within the meaning of the Act) in
connection with the offer or sale of the Shares, in each case other than
the Prospectus;
(o) not to, and to cause the Subsidiaries not to, take, directly or
indirectly, any action designed, or which will constitute, or has
constituted, or would reasonably be expected to cause or result in the
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Shares;
(p) to use its best efforts to cause the Common Stock, including the
Shares, to be listed on and for quotation on the NASDAQ and to maintain
such listing;
(q) to maintain a transfer agent and, if necessary under the
jurisdiction of incorporation of the Company, a registrar for the Common
Stock; and
(r) to cause the Shares to be admitted to trading on AIM as soon as
practicable on or after the time of purchase.
6. Certain Covenants of the Selling Stockholders. Each Selling Stockholder
hereby agrees:
(a) not, at any time at or after the execution of this Agreement, to
offer or sell any Shares by means of any "prospectus" (within the meaning
of the Act), or use any "prospectus" (within the meaning of the Act) in
connection with the offer or sale of the Shares, in each case other than
the Prospectus;
(b) not to take, directly or indirectly, any action designed, or which
will constitute, or has constituted, or would reasonably be expected to
cause or result in the stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Shares;
(c) to pay or cause to be paid all taxes, if any, on the transfer and
sale of the Additional Shares being sold by such Selling Stockholder;
(d) to advise you promptly, and if requested by you, confirm such
advice in writing, so long as a prospectus is required by the Act to be
delivered (whether physically or through compliance with Rule 172 under the
Act or any similar rule) in connection with any sale of Shares, of (i) any
material change in the business, properties, financial condition, results
of operations, cash flows, management or prospects of the Company and the
Subsidiaries taken as a whole, (ii) any change in information in the
Registration
-27-
Statement, each Preliminary Prospectus, the Prospectus and each Permitted
Free Writing Prospectus, if any, relating to such Selling Stockholder and
(iii) any new material information relating to the Company or relating to
any matter stated in the Registration Statement, each Preliminary
Prospectus, the Prospectus and each Permitted Free Writing Prospectus, if
any, which comes to the attention of such Selling Stockholder; provided,
however, that clauses (i) and (iii) of this Section 6(d) shall not apply to
the Non-Management Stockholder; and
(e) prior to or concurrently with the execution and delivery of this
Agreement, to execute and deliver to the Underwriters a Lock-Up Agreement.
7. Covenant to Pay Costs. The Company agrees to pay all costs, expenses,
fees and taxes in connection with (i) the preparation and filing of the
Registration Statement, each Preliminary Prospectus, the Prospectus, each
Permitted Free Writing Prospectus and any amendments or supplements thereto, and
the printing and furnishing of copies of each thereof to the Underwriters and to
dealers (including costs of mailing and shipment), (ii) the registration, issue,
sale and delivery of the Shares including any stock or transfer taxes and stamp
or similar duties payable upon the sale, issuance or delivery of the Shares to
the Underwriters, (iii) the producing, word processing and/or printing of this
Agreement, any Agreement Among Underwriters, any dealer agreements, any Powers
of Attorney and Custody Agreements and any closing documents (including
compilations thereof) and the reproduction and/or printing and furnishing of
copies of each thereof to the Underwriters and (except closing documents) to
dealers (including costs of mailing and shipment), (iv) the qualification of the
Shares for offering and sale under state or foreign laws and the determination
of their eligibility for investment under state or foreign law (including the
legal fees and filing fees and other disbursements of counsel for the
Underwriters) and the printing and furnishing of copies of any blue sky surveys
or legal investment surveys to the Underwriters and to dealers, (v) any listing
of the Shares on any securities exchange or qualification of the Shares for
quotation on the NASDAQ or AIM and any registration thereof under the Exchange
Act, (vi) any filing for review of the public offering of the Shares by the
NASD, including the legal fees and filing fees and other disbursements of
counsel to the Underwriters relating to NASD matters, (vii) the fees and
disbursements of any transfer agent or registrar for the Shares and the fees and
disbursements of the Custodian, (viii) the costs and expenses of the Company
relating to presentations or meetings undertaken in connection with the
marketing of the offering and sale of the Shares to prospective investors and
the Underwriters' sales forces, including, without limitation, expenses
associated with the production of road show slides and graphics, fees and
expenses of any consultants engaged in connection with the road show
presentations, travel, lodging and other expenses incurred by the officers of
the Company and any such consultants, and the cost of any aircraft chartered at
the request or with the consent of the Company in connection with the road show,
(ix) the costs and expenses of qualifying the Shares for inclusion in the
book-entry settlement system of the DTC, (x) the preparation and filing of the
Exchange Act Registration Statement, including any amendments thereto, and (xi)
the performance of the Company's and the Selling Stockholders' other obligations
hereunder. The provisions of this Section 7 are not intended to affect any right
of the Company to reimbursement from any Selling Stockholder pursuant to any
agreement between the Company and such Selling Stockholder with respect to the
foregoing.
-28-
8. Reimbursement of Underwriters' Expenses. If the Shares are not delivered
for any reason other than the termination of this Agreement pursuant to the
fifth paragraph of Section 11 hereof or the default by one or more of the
Underwriters in its or their respective obligations hereunder, the Company
shall, in addition to paying the amounts described in Section 7 hereof,
reimburse the Underwriters for all of their reasonably incurred out-of-pocket
expenses, including the reasonable fees and disbursements of their counsel.
9. Conditions of Underwriters' Obligations. The several obligations of the
Underwriters hereunder are subject to the accuracy of the respective
representations and warranties on the part of the Company and each Selling
Stockholder on the date hereof, at the time of purchase and, if applicable, at
the additional time of purchase, the performance by the Company and each Selling
Stockholder of each of their respective obligations hereunder and to the
following additional conditions precedent:
(a) The Company shall furnish to you at the time of purchase and, if
applicable, at the additional time of purchase (i) an opinion of ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ and ▇▇▇▇ LLP, counsel for the Company, addressed to
the Underwriters, and dated the time of purchase or the additional time of
purchase, as the case may be, with executed copies for each of the other
Underwriters, and in form and substance satisfactory to the
Representatives, in the form set forth in Exhibit B hereto; (ii) an opinion
of ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ and ▇▇▇▇ LLP, special counsel for the
Company with respect to matters of U.K. law, addressed to the Underwriters,
and dated the time of purchase or the additional time of purchase, as the
case may be, with executed copies for each of the other Underwriters, and
in form and substance satisfactory to the Representatives, in the form set
forth in Exhibit C hereto; (iii) an opinion of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ &
Associates, special counsel for the Company with respect to patents and
proprietary rights, addressed to the Underwriters, and dated the time of
purchase or the additional time of purchase, as the case may be, with
executed copies for each of the other Underwriters, and in form and
substance satisfactory to the Representatives, in the form set forth in
Exhibit D hereto; and (iv) an opinion of Fox Rothschild LLP, special
counsel for the Company with respect to matters of New Jersey law,
addressed to the Underwriters, and dated the time of purchase or the
additional time of purchase, as the case may be, with executed copies for
each of the other Underwriters, and in form and substance satisfactory to
the Representatives, in the form set forth in Exhibit E hereto
(b) You shall have received from KPMG LLP and Deloitte & Touche LLP
letters dated, respectively, the date of this Agreement, the date of the
Prospectus, the time of purchase and, if applicable, the additional time of
purchase, and addressed to the Underwriters (with executed copies for each
of the Underwriters) in the forms satisfactory to the Representatives,
which letters shall cover, without limitation, the various financial
disclosures contained in the Registration Statement, each Preliminary
Prospectus, the Prospectus and each Permitted Free Writing Prospectus, if
any.
(c) You shall have received at the time of purchase and, if
applicable, at the additional time of purchase, the favorable opinion of
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for
-29-
the Underwriters, dated the time of purchase or the additional time of
purchase, as the case may be, in form and substance reasonably satisfactory
to the Representatives.
(d) No Prospectus or amendment or supplement to the Registration
Statement or the Prospectus shall have been filed to which you shall have
objected in writing.
(e) The Registration Statement, the Exchange Act Registration
Statement and any registration statement required to be filed, prior to the
sale of the Shares, under the Act pursuant to Rule 462(b) shall have been
filed and shall have become effective under the Act or the Exchange Act, as
the case may be. If Rule 430A under the Act is used, the Prospectus shall
have been filed with the Commission pursuant to Rule 424(b) under the Act
at or before 5:30 P.M., New York City time, on the second full business day
after the date of this Agreement (or such earlier time as may be required
under the Act).
(f) Prior to and at the time of purchase, and, if applicable, the
additional time of purchase, (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued under
the Act or proceedings initiated under Section 8(d) or 8(e) of the Act;
(ii) the Registration Statement and all amendments thereto shall not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading; (iii) none of the Preliminary Prospectuses or the
Prospectus, and no amendment or supplement thereto, shall include an untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they are made, not misleading; (iv) no Disclosure Package, and
no amendment or supplement thereto, shall include an untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
are made, not misleading; and (v) none of the Permitted Free Writing
Prospectuses, if any, shall include an untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they are made, not
misleading.
(g) The Company will, at the time of purchase and, if applicable, at
the additional time of purchase, deliver to you a certificate of its Chief
Executive Officer and its Chief Financial Officer, dated the time of
purchase or the additional time of purchase, as the case may be, in the
form attached as Exhibit F hereto.
(h) In connection with any sale of Additional Shares by the Selling
Stockholders hereunder, the Selling Stockholders shall furnish to you at
the additional time of purchase (x) an opinion of ▇▇▇▇▇▇, ▇▇▇▇▇ & Bockius
LLP, counsel for the Selling Stockholder identified on Schedule C annexed
hereto as the "Management Stockholder", addressed to the Underwriters, and
dated the additional time of purchase with executed copies for each of the
other Underwriters, and in form and substance satisfactory to the
Representatives, in the form set forth in Exhibit G hereto and an opinion
of Fox Rothschild LLP, counsel for the Non-Management Stockholder,
addressed to the Underwriters, and dated the additional time of purchase
with executed copies for each of the other Underwriters, and in form and
substance satisfactory to the Representatives, in the form set forth in
Exhibit H hereto, and (y) a certificate signed by a
-30-
Representative of the Selling Stockholders, dated the additional time of
purchase in the form attached as Exhibit I hereto.
(i) You shall have received each of the signed Lock-Up Agreements
referred to in Section 3(t) hereof, and each such Lock-Up Agreement shall
be in full force and effect at the time of purchase and the additional time
of purchase, as the case may be.
(j) You shall have received satisfactory evidence that the Certificate
of Merger evidencing the effectiveness of the merger between Ocean Power
Technologies, Inc., a New Jersey corporation, and Ocean Power Technologies,
Inc., a Delaware corporation, as the surviving corporation, has been duly
filed with (x) the Secretary of State of the State of Delaware and (y) the
office of the Treasurer of the State of New Jersey.
(k) The Company shall have furnished to you such other documents and
certificates as to the accuracy and completeness of any statement in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
Permitted Free Writing Prospectus as of the time of purchase and, if
applicable, the additional time of purchase, as you may reasonably request.
(l) The Shares shall have been approved for listing on and for
quotation on the NASDAQ, subject only to notice of issuance and evidence of
satisfactory distribution at or prior to the time of purchase or the
additional time of purchase, as the case may be.
(m) The NASD shall not have raised any objection with respect to the
fairness or reasonableness of the underwriting, or other arrangements of
the transactions, contemplated hereby.
(n) Each Selling Stockholder shall have furnished to you a copy of
its Power of Attorney and Custody Agreement, and such other documents and
certificates as to the accuracy and completeness of any statement relating
to such Selling Stockholder in the Registration Statement, any Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus as of
the additional time of purchase as you may reasonably request.
10. Effective Date of Agreement; Termination. This Agreement shall become
effective when the parties hereto have executed and delivered this Agreement.
The obligations of the several Underwriters hereunder shall be subject
to termination in the absolute discretion of the Representatives, if (1) since
the time of execution of this Agreement or the earlier respective dates as of
which information is given in the Registration Statement, each Preliminary
Prospectus, the Prospectus and each Permitted Free Writing Prospectus, if any,
there has been any change or any development involving a prospective change in
the business, properties, management, financial condition or results of
operations of the Company and the Subsidiaries taken as a whole, the effect of
which change or development is, in the sole judgment of the Representatives, so
material and adverse as to make it impractical or inadvisable to proceed with
the public offering or the delivery of the Shares on the terms and in the manner
contemplated in the Registration Statement, each Preliminary Prospectus, the
-31-
Prospectus and each Permitted Free Writing Prospectus, if any, or (2) since the
time of execution of this Agreement, there shall have occurred: (A) a suspension
or material limitation in trading in securities generally on the NYSE, the
American Stock Exchange or the NASDAQ; (B) a suspension or material limitation
in trading in the Company's securities on the NASDAQ; (C) a general moratorium
on commercial banking activities declared by either federal or New York State
authorities or a material disruption in commercial banking or securities
settlement or clearance services in the United States; (D) a suspension or
material limitation in trading in the Company's securities on AIM; (E) an
outbreak or escalation of hostilities or acts of terrorism involving the United
States or a declaration by the United States of a national emergency or war; or
(F) any other calamity or crisis or any change in financial, political or
economic conditions in the United States or elsewhere, if the effect of any such
event specified in clause (D), (E) or (F), in the sole judgment of the
Representatives, makes it impractical or inadvisable to proceed with the public
offering or the delivery of the Shares on the terms and in the manner
contemplated in the Registration Statement, each Preliminary Prospectus, the
Prospectus and each Permitted Free Writing Prospectus, if any, or (3) since the
time of execution of this Agreement, there shall have occurred any downgrading,
or any notice or announcement shall have been given or made of: (A) any intended
or potential downgrading or (B) any watch, review or possible change that does
not indicate an affirmation or improvement in the rating accorded any securities
of or guaranteed by the Company or any Subsidiary by any "nationally recognized
statistical rating organization," as that term is defined in Rule 436(g)(2)
under the Act.
If the Representatives elect to terminate this Agreement as provided
in this Section 10, the Company, the Selling Stockholders and each other
Underwriter shall be notified promptly in writing.
If the sale to the Underwriters of the Shares, as contemplated by this
Agreement, is not carried out by the Underwriters for any reason permitted under
this Agreement, or if such sale is not carried out because the Company or any
Selling Stockholder, as the case may be, shall be unable to comply with any of
the terms of this Agreement, the Company and the Selling Stockholders shall not
be under any obligation or liability under this Agreement (except to the extent
provided in Sections 7, 8 and 12 hereof), and the Underwriters shall be under no
obligation or liability to the Company or any Selling Stockholder under this
Agreement (except to the extent provided in Section 12 hereof) or to one another
hereunder.
11. Increase in Underwriters' Commitments. Subject to Sections 9 and 10
hereof, if any Underwriter shall default in its obligation to take up and pay
for the Firm Shares to be purchased by it hereunder (otherwise than for a
failure of a condition set forth in Section 9 hereof or a reason sufficient to
justify the termination of this Agreement under the provisions of Section 10
hereof) and if the number of Firm Shares which all Underwriters so defaulting
shall have agreed but failed to take up and pay for does not exceed 10% of the
total number of Firm Shares, the non-defaulting Underwriters (including the
Underwriters, if any, substituted in the manner set forth below) shall take up
and pay for (in addition to the aggregate number of Firm Shares they are
obligated to purchase pursuant to Section 10 hereof) the number of Firm Shares
agreed to be purchased by all such defaulting Underwriters, as hereinafter
provided. Such Shares shall be taken up and paid for by such non-defaulting
Underwriters in such amount or amounts as you may designate with the consent of
each Underwriter so designated or, in the event no such
-32-
designation is made, such Shares shall be taken up and paid for by all
non-defaulting Underwriters pro rata in proportion to the aggregate number of
Firm Shares set forth opposite the names of such non-defaulting Underwriters in
Schedule A annexed hereto.
Without relieving any defaulting Underwriter from its obligations
hereunder, the Company agrees with the non-defaulting Underwriters that it will
not sell any Firm Shares hereunder unless all of the Firm Shares are purchased
by the Underwriters (or by substituted Underwriters selected by you with the
approval of the Company or selected by the Company with your approval).
If a new Underwriter or Underwriters are substituted by the
Underwriters or by the Company for a defaulting Underwriter or Underwriters in
accordance with the foregoing provision, the Company or you shall have the right
to postpone the time of purchase for a period not exceeding five business days
in order that any necessary changes in the Registration Statement and the
Prospectus and other documents may be effected.
The term "Underwriter" as used in this Agreement shall refer to and
include any Underwriter substituted under this Section 11 with like effect as if
such substituted Underwriter had originally been named in Schedule A annexed
hereto.
If the aggregate number of Firm Shares which the defaulting
Underwriter or Underwriters agreed to purchase exceeds 10% of the total number
of Firm Shares which all Underwriters agreed to purchase hereunder, and if
neither the non-defaulting Underwriters nor the Company shall make arrangements
within the five business day period stated above for the purchase of all the
Firm Shares which the defaulting Underwriter or Underwriters agreed to purchase
hereunder, this Agreement shall terminate without further act or deed and
without any liability on the part of the Company to any Underwriter and without
any liability on the part of any non-defaulting Underwriter to the Company.
Nothing in this paragraph, and no action taken hereunder, shall relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
12. Indemnity and Contribution.
(a) The Company agrees to indemnify, defend and hold harmless each
Underwriter, its partners, directors and officers, and any person who
controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and the successors and assigns of all of
the foregoing persons, from and against any loss, damage, expense,
liability or claim (including the reasonable cost of investigation) which,
jointly or severally, any such Underwriter or any such person may incur
under the Act, the Exchange Act, the common law or otherwise, insofar as
such loss, damage, expense, liability or claim arises out of or is based
upon (i) any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or in the Registration
Statement as amended by any post-effective amendment thereof by the
Company) or arises out of or is based upon any omission or alleged omission
to state a material fact required to be stated therein or necessary to make
the statements therein not misleading, except insofar as any such loss,
damage, expense, liability or claim arises out of or is based upon any
untrue statement or alleged untrue statement of a material fact
-33-
contained in, and in conformity with information concerning such
Underwriter furnished in writing by or on behalf of such Underwriter
through you to the Company expressly for use in, the Registration Statement
or arises out of or is based upon any omission or alleged omission to state
a material fact in the Registration Statement in connection with such
information, which material fact was not contained in such information and
which material fact was required to be stated in such Registration
Statement or was necessary to make such information not misleading or (ii)
any untrue statement or alleged untrue statement of a material fact
included in any Prospectus (the term Prospectus for the purpose of this
Section 12 being deemed to include any Preliminary Prospectus, the
Prospectus and any amendments or supplements to the foregoing), in any
Permitted Free Writing Prospectus, in any "issuer information" (as defined
in Rule 433 under the Act) of the Company, which "issuer information" is
required to be, or is, filed with the Commission, or in any Prospectus
together with any combination of one or more of the Permitted Free Writing
Prospectuses, if any, or arises out of or is based upon any omission or
alleged omission to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except, with respect to such Prospectus or Permitted
Free Writing Prospectus, insofar as any such loss, damage, expense,
liability or claim arises out of or is based upon any untrue statement or
alleged untrue statement of a material fact contained in, and in conformity
with information concerning such Underwriter furnished in writing by or on
behalf of such Underwriter through you to the Company expressly for use in,
such Prospectus or Permitted Free Writing Prospectus or arises out of or is
based upon any omission or alleged omission to state a material fact in
such Prospectus or Permitted Free Writing Prospectus in connection with
such information, which material fact was not contained in such information
and which material fact was necessary in order to make the statements in
such information, in the light of the circumstances under which they were
made, not misleading.
(b) Each Selling Stockholder agrees to indemnify, defend and hold
harmless each Underwriter, its partners, directors and officers, and any
person who controls any Underwriter within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act, and the successors and assigns of
all of the foregoing persons, from and against any loss, damage, expense,
liability or claim (including the reasonable cost of investigation) which,
jointly or severally, any such Underwriter or any such person may incur
under the Act, the Exchange Act, the common law or otherwise, insofar as
such loss, damage, expense, liability or claim arises out of or is based
upon (i) any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or in the Registration
Statement as amended by any post-effective amendment thereof by the
Company), or arises out of or is based upon any omission or alleged
omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, except insofar as
any such loss, damage, expense, liability or claim arises out of or is
based upon any untrue statement or alleged untrue statement of a material
fact contained in, and in conformity with information concerning such
Underwriter furnished in writing by or on behalf of such Underwriter
through you to the Company expressly for use in, the Registration Statement
or arises out of or is based upon any omission or alleged omission to state
a material fact in the Registration Statement in connection with
-34-
such information, which material fact was not contained in such information
and which material fact was required to be stated in such Registration
Statement or was necessary to make such information not misleading, or (ii)
any untrue statement or alleged untrue statement of a material fact
included in any Prospectus, in any Permitted Free Writing Prospectus, in
any "issuer information" (as defined in Rule 433 under the Act) of the
Company, which "issuer information" is required to be, or is, filed with
the Commission, or in any Prospectus together with any combination of one
or more of the Permitted Free Writing Prospectuses, if any, or arises out
of or is based upon any omission or alleged omission to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except, with
respect to such Prospectus or Permitted Free Writing Prospectus, insofar as
any such loss, damage, expense, liability or claim arises out of or is
based upon any untrue statement or alleged untrue statement of a material
fact contained in, and in conformity with information concerning such
Underwriter furnished in writing by or on behalf of such Underwriter
through you to the Company expressly for use in, such Prospectus or
Permitted Free Writing Prospectus or arises out of or is based upon any
omission or alleged omission to state a material fact in such Prospectus or
Permitted Free Writing Prospectus in connection with such information,
which material fact was not contained in such information and which
material fact was necessary in order to make the statements in such
information, in the light of the circumstances under which they were made,
not misleading; provided, however, that no Selling Stockholder shall be
responsible, pursuant to this Section 12(b), for losses, damages, expenses,
liabilities or claims for an amount in excess of the aggregate initial
public offering price of the Shares sold by such Selling Stockholder to the
Underwriters pursuant hereto; and provided further, that the Non-Management
Stockholder shall be responsible, pursuant to this Section 12(b), only for
losses, damages, expenses, liabilities or claims arising out of or based
upon such untrue statement or omission or allegation thereof relating to
the Non-Management Stockholder.
(c) Each Underwriter severally agrees to indemnify, defend and hold
harmless the Company, its directors and officers, each Selling Stockholder
and any person who controls the Company within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act, and the successors and assigns
of all of the foregoing persons, from and against any loss, damage,
expense, liability or claim (including the reasonable cost of
investigation) which, jointly or severally, the Company, such Selling
Stockholder or any such person may incur under the Act, the Exchange Act,
the common law or otherwise, insofar as such loss, damage, expense,
liability or claim arises out of or is based upon (i) any untrue statement
or alleged untrue statement of a material fact contained in, and in
conformity with information concerning such Underwriter furnished in
writing by or on behalf of such Underwriter through you to the Company
expressly for use in, the Registration Statement (or in the Registration
Statement as amended by any post-effective amendment thereof by the
Company), or arises out of or is based upon any omission or alleged
omission to state a material fact in such Registration Statement in
connection with such information, which material fact was not contained in
such information and which material fact was required to be stated in such
Registration Statement or was necessary to make such information not
misleading or (ii) any untrue statement or alleged untrue statement of a
material fact contained in, and in conformity
-35-
with information concerning such Underwriter furnished in writing by or on
behalf of such Underwriter through you to the Company expressly for use in,
a Prospectus or a Permitted Free Writing Prospectus, or arises out of or is
based upon any omission or alleged omission to state a material fact in
such Prospectus or Permitted Free Writing Prospectus in connection with
such information, which material fact was not contained in such information
and which material fact was necessary in order to make the statements in
such information, in the light of the circumstances under which they were
made, not misleading.
(d) If any action, suit or proceeding (each, a "Proceeding") is
brought against a person (an "indemnified party") in respect of which
indemnity may be sought against the Company, a Selling Stockholder or an
Underwriter (as applicable, the "indemnifying party") pursuant to
subsection (a), (b) or (c), respectively, of this Section 12, such
indemnified party shall promptly notify such indemnifying party in writing
of the institution of such Proceeding and such indemnifying party shall
assume the defense of such Proceeding, including the employment of counsel
reasonably satisfactory to such indemnified party and payment of all fees
and expenses; provided, however, that the omission to so notify such
indemnifying party shall not relieve such indemnifying party from any
liability which such indemnifying party may have to any indemnified party
or otherwise. 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 party (or, in the case such
indemnifying party is a Selling Stockholder, by such Selling Stockholder or
by a Representative of the Selling Stockholders) in connection with the
defense of such Proceeding, (ii) the indemnifying party shall not have,
within a reasonable period of time in light of the circumstances, employed
counsel to defend such Proceeding, (iii) the indemnifying party does not
diligently defend the action after assumption of the defense, or (iv) such
indemnified party or parties shall have reasonably concluded that there may
be defenses available to it or them which are different from, additional to
or in conflict with those available to such indemnifying party (in which
case such indemnifying party shall not have the right to direct the defense
of such Proceeding on behalf of the indemnified party or parties), in any
of which events such fees and expenses shall be borne by such indemnifying
party and paid as incurred (it being understood, however, that such
indemnifying party shall not be liable for the expenses of more than one
separate counsel (in addition to any local counsel) in any one Proceeding
or series of related Proceedings in the same jurisdiction representing the
indemnified parties who are parties to such Proceeding). The indemnifying
party shall not be liable for any settlement of any Proceeding effected
without its written consent (or, in the case such indemnifying party is a
Selling Stockholder, without the written consent of either such Selling
Stockholder or a Representative of the Selling Stockholders) but, if
settled with its written consent (or, in the case such indemnifying party
is a Selling Stockholder, with the written consent of such Selling
Stockholder or of a Representative of the Selling Stockholders), such
indemnifying party agrees to indemnify and hold harmless the indemnified
party or parties from and against any loss or liability by reason of such
settlement. Notwithstanding the foregoing sentence, if at any time an
indemnified party
-36-
shall have requested an indemnifying party (or, where such indemnifying
party is a Selling Stockholder, requested such Selling Stockholder or any
Representative of the Selling Stockholders) to reimburse the indemnified
party for fees and expenses of counsel as contemplated by the second
sentence of this Section 12(d), then the indemnifying party agrees that it
shall be liable for any settlement of any Proceeding effected without its
written consent if (i) such settlement is entered into more than 60
business days after receipt by such indemnifying party (or, where such
indemnifying party is a Selling Stockholder, receipt by such Selling
Stockholder or by any Representative of the Selling Stockholders) of the
aforesaid request, (ii) such indemnifying party shall not have fully
reimbursed the indemnified party in accordance with such request prior to
the date of such settlement and (iii) such indemnified party shall have
given the indemnifying party (or, where such indemnifying party is a
Selling Stockholder, given such Selling Stockholder or any Representative
of the Selling Stockholders) at least 30 days' prior notice of its
intention to settle. No indemnifying party shall, without the prior written
consent of the indemnified party (or, where such indemnified party is a
Selling Stockholder, the prior written consent of such Selling Stockholder
or of any Representative of the Selling Stockholders), effect any
settlement of any pending or threatened Proceeding 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 claims that are the subject matter of such Proceeding and does
not include an admission of fault or culpability or a failure to act by or
on behalf of such indemnified party.
(e) If the indemnification provided for in this Section 12 is
unavailable to an indemnified party under subsections (a), (b) and (c) of
this Section 12 or insufficient to hold an indemnified party harmless in
respect of any losses, damages, expenses, liabilities or claims referred to
therein, then each applicable indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of such
losses, damages, expenses, liabilities or claims (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company and
the Selling Stockholders on the one hand and the Underwriters on the other
hand from the offering of the Shares 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
Stockholders on the one hand and of the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
damages, expenses, liabilities or claims, as well as any other relevant
equitable considerations. The relative benefits received by the Company and
the Selling Stockholders on the one hand and the Underwriters on the other
shall be deemed to be in the same respective proportions as the total
proceeds from the offering (net of underwriting discounts and commissions
but before deducting expenses) received by the Company and the Selling
Stockholders, and the total underwriting discounts and commissions received
by the Underwriters, bear to the aggregate public offering price of the
Shares. The relative fault of the Company and the Selling Stockholders on
the one hand and of the Underwriters on the other shall be determined by
reference to, among other things, whether the untrue statement or alleged
untrue statement of a material fact
-37-
or omission or alleged omission relates to information supplied by the
Company or the Selling Stockholders or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The amount paid or payable
by a party as a result of the losses, damages, expenses, liabilities and
claims referred to in this subsection shall be deemed to include any legal
or other fees or expenses reasonably incurred by such party in connection
with investigating, preparing to defend or defending any Proceeding.
(f) The Company, the Selling Stockholders and the Underwriters agree
that it would not be just and equitable if contribution pursuant to this
Section 12 were determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of
allocation that does not take account of the equitable considerations
referred to in subsection (e) above. Notwithstanding the provisions of this
Section 12, no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Shares
underwritten by such Underwriter and distributed to the public were offered
to the public exceeds the amount of any damage which such Underwriter has
otherwise been required to pay by reason of such untrue statement 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 to
contribute pursuant to this Section 12 are several in proportion to their
respective underwriting commitments and not joint.
(g) The indemnity and contribution agreements contained in this
Section 12 and the covenants, warranties and representations of the Company
and the Selling Stockholders contained in this Agreement shall remain in
full force and effect regardless of any investigation made by or on behalf
of any Underwriter, its partners, directors or officers or any person
(including each partner, officer or director of such person) who controls
any Underwriter within the meaning of Section 15 of the Act or Section 20
of the Exchange Act, or by or on behalf of the Company, its respective
directors or officers, any Selling Stockholder or any person who controls
the Company within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act, and shall survive any termination of this Agreement or
the issuance and delivery of the Shares to be sold by the Company pursuant
hereto and the delivery of the Additional Shares to be sold by the Selling
Stockholders pursuant hereto. The Company, the Selling Stockholders and
each Underwriter agree promptly to notify each other of the commencement of
any Proceeding against it and, in the case of the Company, against any of
its officers or directors in connection with the issuance and sale of the
Shares, or in connection with the Registration Statement, any Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus.
13. Information Furnished by the Underwriters. The statements set forth in
the last sentence on the cover page of the Prospectus and the statements set
forth in the first paragraph under the subheading "Commissions and Discounts"
and the first four paragraphs under the subheading "Price Stabilization, Short
Positions" under the caption "Underwriting" in the
-38-
Prospectus, only insofar as such statements relate to the amount of selling
concession and reallowance or to over-allotment and stabilization activities
that may be undertaken by the Underwriters, constitute the only information
furnished by or on behalf of the Underwriters, as such information is referred
to in Sections 3 and 12 hereof.
14. Notices. Except as otherwise herein provided, all statements, requests,
notices and agreements shall be in writing or by telegram or facsimile and, if
to the Underwriters, shall be sufficient in all respects if delivered or sent to
UBS Securities LLC, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, Attention:
Syndicate Department; Banc of America Securities LLC, ▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Syndicate Department; and Bear, ▇▇▇▇▇▇▇ & Co. Inc.,
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Syndicate Department;
and, if to the Company, shall be sufficient in all respects if delivered or sent
to the Company at the offices of the Company at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chairman & Chief Executive
Officer (facsimile: 609-730-0404); and, if to any Selling Stockholder, shall be
sufficient in all respects if delivered or sent to either Representative of the
Selling Stockholders in care of the Company at the offices of the Company as
aforesaid.
15. Governing Law; Construction. This Agreement and any claim, counterclaim
or dispute of any kind or nature whatsoever arising out of or in any way
relating to this Agreement ("Claim"), directly or indirectly, shall be governed
by, and construed in accordance with, the laws of the State of New York. The
section headings in this Agreement have been inserted as a matter of convenience
of reference and are not a part of this Agreement.
16. Submission to Jurisdiction. Except as set forth below, no Claim may be
commenced, prosecuted or continued in any court other than the courts of the
State of New York located in the City and County of New York or in the United
States District Court for the Southern District of New York, which courts shall
have jurisdiction over the adjudication of such matters, and the Company and the
Selling Stockholders consent to the jurisdiction of such courts and personal
service with respect thereto. The Company and the Selling Stockholders hereby
consent to personal jurisdiction, service and venue in any court in which any
Claim arising out of or in any way relating to this Agreement is brought by any
third party against any Underwriter or any indemnified party. Each Underwriter,
the Company (on its behalf and, to the extent permitted by applicable law, on
behalf of its stockholders and affiliates) and each Selling Stockholder waives
all right to trial by jury in any action, proceeding or counterclaim (whether
based upon contract, tort or otherwise) in any way arising out of or relating to
this Agreement. The Company and the Selling Stockholders agree that a final
judgment in any such action, proceeding or counterclaim brought in any such
court shall be conclusive and binding upon the Company and each Selling
Stockholder and may be enforced in any other courts to the jurisdiction of which
the Company or any Selling Stockholder is or may be subject, by suit upon such
judgment.
17. Parties at Interest. The Agreement herein set forth has been and is
made solely for the benefit of the Underwriters, the Company and the Selling
Stockholders and to the extent provided in Section 12 hereof the controlling
persons, partners, directors and officers referred to in such Section, and their
respective successors, assigns, heirs, personal representatives and
-39-
executors and administrators. No other person, partnership, association or
corporation (including a purchaser, as such purchaser, from any of the
Underwriters) shall acquire or have any right under or by virtue of this
Agreement.
18. No Fiduciary Relationship. The Company and the Selling Stockholders
hereby acknowledge that the Underwriters are acting solely as underwriters in
connection with the purchase and sale of the Company's securities. The Company
and the Selling Stockholders further acknowledge that the Underwriters are
acting pursuant to a contractual relationship created solely by this Agreement
entered into on an arm's length basis, and in no event do the parties intend
that the Underwriters act or be responsible as a fiduciary to the Company, its
management, stockholders or creditors, any Selling Stockholder or any other
person in connection with any activity that the Underwriters may undertake or
have undertaken in furtherance of the purchase and sale of the Company's
securities, either before or after the date hereof. The Underwriters hereby
expressly disclaim any fiduciary or similar obligations to the Company or any
Selling Stockholder, either in connection with the transactions contemplated by
this Agreement or any matters leading up to such transactions, and the Company
and the Selling Stockholders hereby confirm their understanding and agreement to
that effect. The Company, the Selling Stockholders and the Underwriters agree
that they are each responsible for making their own independent judgments with
respect to any such transactions and that any opinions or views expressed by the
Underwriters to the Company or any Selling Stockholder regarding such
transactions, including, but not limited to, any opinions or views with respect
to the price or market for the Company's securities, do not constitute advice or
recommendations to the Company or any Selling Stockholder. The Company and the
Selling Stockholders hereby waive and release, to the fullest extent permitted
by law, any claims that the Company or any Selling Stockholder may have against
the Underwriters with respect to any breach or alleged breach of any fiduciary
or similar duty to the Company or any Selling Stockholder in connection with the
transactions contemplated by this Agreement or any matters leading up to such
transactions.
19. Counterparts. This Agreement may be signed by the parties in one or
more counterparts which together shall constitute one and the same agreement
among the parties.
20. Successors and Assigns. This Agreement shall be binding upon the
Underwriters and the Company and the Selling Stockholders and their successors
and assigns and any successor or assign of any substantial portion of the
Company's, any Selling Stockholder's and any of the Underwriters' respective
businesses and/or assets.
21. Miscellaneous. UBS Securities LLC ("UBS"), an indirect, wholly owned
subsidiary of UBS AG, is not a bank and is separate from any affiliated bank,
including any U.S. branch or agency of UBS AG. Because UBS is a separately
incorporated entity, it is solely responsible for its own contractual
obligations and commitments, including obligations with respect to sales and
purchases of securities. Securities sold, offered or recommended by UBS are not
deposits, are not insured by the Federal Deposit Insurance Corporation, are not
guaranteed by a branch or agency, and are not otherwise an obligation or
responsibility of a branch or agency.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGES FOLLOW]
-40-
If the foregoing correctly sets forth the understanding among the
Company, the Selling Stockholders and the several Underwriters, please so
indicate in the space provided below for that purpose, whereupon this Agreement
and your acceptance shall constitute a binding agreement among the Company, the
Selling Stockholders and the Underwriters, severally.
Very truly yours,
OCEAN POWER TECHNOLOGIES INC.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
THE SELLING STOCKHOLDERS NAMED IN
SCHEDULE C HERETO
By:
------------------------------------
Name:
----------------------------------
Title: Attorney-in-Fact
Accepted and agreed to as of the date
first above written, on behalf of
themselves and the other several
Underwriters named in Schedule A
annexed hereto
UBS SECURITIES LLC
BANC OF AMERICA SECURITIES LLC
BEAR, ▇▇▇▇▇▇▇ & CO. INC.
By: UBS SECURITIES LLC
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
By: BANC OF AMERICA SECURITIES LLC
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
By: BEAR, ▇▇▇▇▇▇▇ & CO. INC.
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
SCHEDULE A
Number of Firm
Underwriter Shares
----------- --------------
UBS SECURITIES LLC.............................................
BANC OF AMERICA SECURITIES LLC.................................
BEAR, ▇▇▇▇▇▇▇ & CO. INC........................................
FIRST ALBANY CAPITAL INC.......................................
--------------
Total.......................................................
==============
A-1
SCHEDULE B
[List any Permitted Free Writing Prospectuses]
B-1
SCHEDULE C
Number of Number of
Firm Additional
Shares Shares
----------- ----------
Company................................................. [# of firm [# of
shares company
from additional
company] shares]
Selling Stockholders
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (the "Non-Management Stockholder")... 0 [____]
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ (the "Management Stockholder")... 0 [____]
----------- ----------
Total............................................. [# of
[# of firm additional
shares] shares]
=========== ==========
C-1
EXHIBIT A
Lock-Up Agreement
_____, 2007
UBS Securities LLC
Banc of America Securities LLC
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
as Representatives of the several Underwriters
c/o UBS Securities LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Banc of America Securities LLC
▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
This Lock-Up Agreement is being delivered to you in connection with
the proposed Underwriting Agreement (the "Underwriting Agreement") to be entered
into by OCEAN POWER TECHNOLOGIES INC., a New Jersey corporation, which is
contemplating reincorporating in the State of Delaware by merger or otherwise
(the New Jersey corporation and the Delaware successor entity, if any,
collectively the "Company"), the Selling Stockholders named therein and you and
the other underwriters named in Schedule A annexed to the Underwriting
Agreement, with respect to the public offering (the "Offering") of common stock,
$0.001 par value per share, of the Company (the "Common Stock").
In order to induce you to enter into the Underwriting Agreement, the
undersigned agrees that, for a period (the "Lock-Up Period") beginning on the
date hereof and ending on, and including, the date that is 180 days after the
date of the final prospectus relating to the Offering, the undersigned will not,
without the prior written consent of UBS Securities LLC, Banc of America
Securities LLC and Bear, ▇▇▇▇▇▇▇ & Co. Inc., (i) sell, offer to sell, contract
or agree to sell, hypothecate, pledge, grant any option to purchase or otherwise
dispose of or agree to dispose of, directly or indirectly, or file (or
participate in the filing of) a registration statement with the Securities and
Exchange Commission (the "Commission") in respect of, or establish or increase a
put equivalent position or liquidate or decrease a call equivalent position
within the meaning of Section 16 of the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated thereunder
(the "Exchange Act") with respect to, any Common Stock or any other securities
of the Company that are substantially similar to Common Stock, or any securities
convertible into or exchangeable or exercisable for, or any warrants or other
rights to purchase, the foregoing, (ii) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of
A-1
Common Stock or any other securities of the Company that are substantially
similar to Common Stock, or any securities convertible into or exchangeable or
exercisable for, or any warrants or other rights to purchase, the foregoing,
whether any such transaction is to be settled by delivery of Common Stock or
such other securities, in cash or otherwise or (iii) publicly announce an
intention to effect any transaction specified in clause (i) or (ii). The
foregoing sentence shall not apply to (a) the registration of the offer and sale
of Common Stock as contemplated by the Underwriting Agreement and the sale of
the Common Stock to the Underwriters (as defined in the Underwriting Agreement)
in the Offering, (b) bona fide gifts, provided the recipient thereof agrees in
writing with the Underwriters to be bound by the terms of this Lock-Up Agreement
or (c) transfers or dispositions to any trust for the direct or indirect benefit
of the undersigned and/or the immediate family of the undersigned, provided that
such trust agrees in writing with the Underwriters to be bound by the terms of
this Lock-Up Agreement. For purposes of this paragraph, "immediate family" shall
mean the undersigned and the spouse, any lineal descendent, father, mother,
brother or sister of the undersigned.
Notwithstanding anything herein to the contrary, the preceding
paragraph shall not apply to the sale of Additional Shares by any Selling
Stockholder to the Underwriters pursuant to the Underwriting Agreement.
In addition, the undersigned hereby waives any rights the undersigned
may have to require registration of Common Stock in connection with the filing
of a registration statement relating to the Offering. The undersigned further
agrees that, for the Lock-Up Period, the undersigned will not, without the prior
written consent of UBS Securities LLC, Banc of America Securities LLC and Bear,
▇▇▇▇▇▇▇ & Co. Inc., make any demand for, or exercise any right with respect to,
the registration of Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock, or warrants or other rights to
purchase Common Stock or any such securities.
Notwithstanding the above, if (a) during the period that begins on the
date that is fifteen (15) calendar days plus three (3) business days before the
last day of the Lock-Up Period and ends on the last day of the Lock-Up Period,
the Company issues an earnings release or material news or a material event
relating to the Company occurs; or (b) prior to the expiration of the Lock-Up
Period, the Company announces that it will release earnings results during the
sixteen (16) day period beginning on the last day of the Lock-Up Period, then
the restrictions imposed by this Lock-Up Agreement shall continue to apply until
the expiration of the date that is fifteen (15) calendar days plus three (3)
business days after the date on which the issuance of the earnings release or
the material news or material event occurs.
In addition, the undersigned hereby waives any and all preemptive
rights, participation rights, resale rights, rights of first refusal and similar
rights that the undersigned may have in connection with the Offering or with any
issuance or sale by the Company of any equity or other securities before the
Offering (including any such right arising pursuant to any agreement with
Evolution ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Limited or any other agreement, obligation or
undertaking made by or on behalf of the Company in connection with the admission
of the Common Stock to trading on AIM), except for any such rights as have been
heretofore duly exercised.
A-2
The undersigned hereby confirms that the undersigned has not, directly
or indirectly, taken, and hereby covenants that the undersigned will not,
directly or indirectly, take, any action designed, or which has constituted or
will constitute or might reasonably be expected to cause or result in the
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of shares of Common Stock.
In furtherance of the foregoing, the Company and its transfer agent
and registrar are hereby authorized to decline to make any transfer of Common
Stock if such transfer would constitute a violation or breach of this Lock-Up
Agreement. The undersigned agrees and consents to the entry of stock transfer
instructions with the Company's transfer agent and registrar against the
transfer of Common Stock except in compliance with this Lock-Up Agreement.
The undersigned understands that the Company and the Underwriters are
relying upon this Lock-Up Agreement in proceeding toward consummation of the
Offering. The undersigned further understands that this Lock-Up Agreement is
irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors and assigns.
Whether or not the Offering actually occurs depends on a number of
factors, including market conditions. Any Offering will only be made pursuant to
an Underwriting Agreement, the terms of which are subject to negotiation among
the Company and the Underwriters.
* * *
A-3
If (i) the Company notifies you in writing that it does not intend to
proceed with the Offering, (ii) the registration statement filed with the
Commission with respect to the Offering is withdrawn, (iii) for any reason the
Underwriting Agreement shall be terminated prior to the "time of purchase" (as
defined in the Underwriting Agreement) or (iv) the registration statement filed
with the Commission with respect to the Offering is not declared effective by
June 30, 2007, this Lock-Up Agreement shall be terminated and the undersigned
shall be released from its obligations hereunder. This Lock-Up Agreement shall
be governed by, and construed in accordance with, the laws of the State of New
York.
Very truly yours,
----------------------------------------
Name:
----------------------------------
▇-▇
▇▇▇▇▇▇▇ ▇-▇
LIST OF PARTIES TO EXECUTE LOCK-UP AGREEMENTS
Name Position
-------------------------- ---------------------------------------------------
1. ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Chief Executive Officer and Director
2. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Chief Financial Officer, Senior Vice President,
Treasurer, Secretary and Director, and a Selling
Stockholder
3. ▇▇▇▇ ▇. ▇▇▇▇▇▇ Chief Executive and Director of Ocean Power
Technologies, Ltd.
4. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ Senior Vice President, Engineering
5. ▇▇▇ ▇▇▇▇ ▇. ▇▇▇ Director
6. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Director
7. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ III Chairman of the Board of Directors
8. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Selling Stockholder
9. ▇▇▇▇ ▇▇▇▇▇▇ Employee
10. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Employee
11. Stuart ▇▇▇▇▇▇▇ ▇▇▇▇▇ Employee
12. ▇▇▇▇▇ ▇▇▇▇ Employee
13. ▇▇▇▇ ▇▇▇▇▇▇▇▇ Employee
14. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Employee
15. ▇▇▇▇▇ ▇▇▇▇▇▇ Employee
16. ▇▇▇▇▇ ▇▇▇▇▇▇▇ Employee
17. ▇▇▇▇▇ ▇▇▇▇▇ Employee
18. ▇▇▇▇▇ ▇▇▇▇▇ Employee
19. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Employee
A-1-1
Name Position
-------------------------- ---------------------------------------------------
20. ▇▇▇▇ ▇▇▇▇▇▇ Employee
21. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Employee
22. ▇▇▇ ▇▇▇▇▇▇ Employee
23. ▇▇▇▇▇ ▇▇▇▇▇▇▇ Employee
24. ▇▇▇▇▇▇▇ ▇▇▇▇▇ Employee
25. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ Employee
26. ▇▇▇▇ ▇▇▇▇▇▇ Employee
27. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Employee
28. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Employee
29. ▇▇▇▇▇▇ ▇▇▇▇▇▇ Employee
30. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Employee
31. ▇▇▇▇▇ ▇▇▇▇▇▇ Employee
32. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Employee
33. ▇▇▇▇▇▇ ▇▇▇▇▇ Employee
34. ▇▇▇▇ ▇▇▇▇▇▇▇ Employee
35. ▇▇▇▇▇ ▇▇▇▇▇▇▇ Employee
36. ▇▇▇▇▇ ▇▇▇▇▇ Employee
37. ▇▇▇▇ ▇▇▇▇▇▇ Employee
38. ▇▇▇▇ ▇▇▇▇▇▇ Employee
39. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Employee
40. ▇▇▇▇ ▇▇▇▇▇▇▇ Employee
41. ▇▇▇▇▇ ▇▇▇▇▇ Employee
A-1-2
(WILMERHALE LOGO)
EXHIBIT B
(WILMERHALE LOGO)
UBS Securities LLC, et al.
As Representatives of the
several Underwriters
______________, 2007
Page 1
SCHEDULE A
Other Information Included in the Disclosure Package
B-1-1
(WILMERHALE LOGO)
UBS Securities LLC, et al.
As Representatives of the
several Underwriters
______________, 2007
Page 1
SCHEDULE B
Jurisdiction of Incorporation Date of Certificate of Public Official
-------------------------------------- --------------------------------------
Delaware
Jurisdictions of Foreign Qualification Date of Certificate of Public Official
-------------------------------------- --------------------------------------
New Jersey
B-2-1
EXHIBIT C
OPINION OF ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ AND ▇▇▇▇ LLP
C-1
EXHIBIT D
OPINION OF ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ & ASSOCIATES
D-1
EXHIBIT E
OPINION OF FOX ROTHSCHILD LLP
E-1
EXHIBIT F
OFFICERS' CERTIFICATE
Each of the undersigned, ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chairman & Chief
Executive Officer of OCEAN POWER TECHNOLOGIES INC., a Delaware corporation (the
"Company"), and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Chief Financial Officer of the Company, on
behalf of the Company, does hereby certify pursuant to Section 7(g) of that
certain Underwriting Agreement dated _____, 2007 (the "Underwriting Agreement")
among the Company and, on behalf of the several Underwriters named therein, UBS
Securities LLC, Banc of America Securities LLC and Bear, ▇▇▇▇▇▇▇ & Co. Inc.,
that as of _____, 2007:
1. He has reviewed the Registration Statement, each Preliminary Prospectus,
the Prospectus and each Permitted Free Writing Prospectus.
2. The representations and warranties of the Company as set forth in the
Underwriting Agreement are true and correct as of the date hereof and as if
made on the date hereof.
3. The Company has performed all of its obligations under the Underwriting
Agreement as are to be performed at or before the date hereof.
4. The conditions set forth in paragraph (f) of Section 7 of the Underwriting
Agreement have been met.
Capitalized terms used herein without definition shall have the
respective meanings ascribed to them in the Underwriting Agreement.
F-1
IN WITNESS WHEREOF, the undersigned have hereunto set their hands on
this __ day of _____, 2007.
---------------------------------------
Name: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman & Chief Executive
Officer
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Financial Officer
F-2
EXHIBIT G
OPINION OF ▇▇▇▇▇▇, ▇▇▇▇▇ & BOCKIUS LLP
G-1
EXHIBIT H
OPINION OF FOX ROTHSCHILD LLP
H-1
EXHIBIT I
CERTIFICATE OF A REPRESENTATIVE OF THE SELLING STOCKHOLDERS
The undersigned, _____, on behalf of each Selling Stockholder (as
defined in the Underwriting Agreement referred to below), does hereby certify
pursuant to Section 9(i) of that certain Underwriting Agreement dated _____,
2007 (the "Underwriting Agreement") among OCEAN POWER TECHNOLOGIES INC., a New
Jersey corporation (the "Company"), the Selling Stockholders named therein and,
on behalf of the several Underwriters named therein, UBS Securities LLC, Banc of
America Securities LLC and Bear, ▇▇▇▇▇▇▇ & Co. Inc., that as of _____, 2007:
1. Each Selling Stockholder has reviewed the Registration Statement, each
Preliminary Prospectus, the Prospectus and each Permitted Free Writing
Prospectus.
2. The representations and warranties of each Selling Stockholder as set forth
in the Underwriting Agreement are true and correct as of the date hereof
and as if made on the date hereof.
3. Each Selling Stockholder has performed all of his or her obligations under
the Underwriting Agreement as are to be performed at or before the date
hereof.
Capitalized terms used herein without definition shall have the
respective meanings ascribed to them in the Underwriting Agreement.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand on this
__ day of _____, 2007 on behalf of each Selling Stockholder.
THE SELLING STOCKHOLDERS NAMED IN
SCHEDULE C ANNEXED TO THE UNDERWRITING
AGREEMENT
By: [REPRESENTATIVE], Attorney-in-Fact
----------------------------------------
Name:
----------------------------------
Title:
---------------------------------
I-1
