1
Exhibit 1.1
ANSOFT CORPORATION
2,000,000 SHARES(1)
COMMON STOCK
UNDERWRITING AGREEMENT
_________, 0000
XXXXXXXXX & XXXXX LLC
XXXXXXX, XXXXXX & XXXXXXXXX, L.L.C.
x/x Xxxxxxxxx & Xxxxx LLC
Xxx Xxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Ladies and Gentlemen:
Ansoft Corporation, a Delaware corporation (herein called the Company),
proposes to issue and sell 2,000,000 shares of its authorized but unissued
Common Stock, $.01 par value per share (herein called the Common Stock), (said
2,000,000 shares of Common Stock being herein called the Underwritten Stock).
The Company proposes to grant to the Underwriters (as hereinafter defined) an
option to purchase up to 300,000 additional shares of Common Stock (herein
called the Option Stock and with the Underwritten Stock herein collectively
called the Stock). The Common Stock is more fully described in the Registration
Statement and the Prospectus hereinafter mentioned.
The Company hereby confirms the agreements made with respect to the
purchase of the Stock by the several underwriters, for whom you are acting,
named in Schedule I hereto (herein collectively called the Underwriters, which
term shall also include any underwriter purchasing Stock pursuant to Section
3(b) hereof). You represent and warrant that you have been authorized by each of
the other Underwriters to enter into this Agreement on its behalf and to act for
it in the manner herein provided.
1. REGISTRATION STATEMENT. The Company has filed with the Securities
and Exchange Commission (herein called the Commission) a registration statement
on Form S-1 (No. 333-41089), including the related Preliminary Prospectus, for
the registration under the Securities Act of 1933, as amended (herein called the
Securities Act), of the Stock. Copies of such registration statement and of each
amendment thereto, if any, including the related Preliminary Prospectus (meeting
the requirements of Rule 430A of the rules and regulations of the Commission)
heretofore filed by the Company with the Commission have been delivered to you.
The term Registration Statement as used in this Agreement shall mean such
registration statement, including all exhibits and financial statements, all
information omitted therefrom in reliance upon Rule 430A and contained in the
Prospectus referred to below, and any registration statement filed pursuant to
Rule 462(b) of the rules and regulations of the Commission with respect to the
Stock (herein called a Rule 462(b) registration statement) in the form in which
it became effective and, in the event of any amendment thereto after the
effective date of such registration statement (herein called the Effective
Date), shall also mean (from and after the effectiveness of such amendment) such
registration statement as so amended including any Rule 462(b) registration
statement. The term Prospectus as used in this Agreement shall mean the
prospectus relating to the Stock first filed with the Commission pursuant to
Rule 424(b) and Rule 430A or (if no such filing is required) as included in the
Registration Statement, and, in the event of any
--------
(1) Plus an option to purchase from the Company up to 300,000 additional shares
to cover over-allotments.
2
supplement or amendment to such prospectus after the Effective Date, shall also
mean (from and after the filing with the Commission of such supplement or of the
effectiveness of such amendment) such prospectus as so supplemented or amended.
The term Preliminary Prospectus as used in this Agreement shall mean each
preliminary prospectus included in such registration statement prior to the time
it becomes effective. For purposes of this Agreement, all references to the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
amendment or supplement to any of the foregoing shall, if applicable, be deemed
to include the copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system ("XXXXX").
The Registration Statement has been declared effective under the
Securities Act, and no post-effective amendment to the Registration Statement
has been filed as of the date of this Agreement. The Company has caused to be
delivered to you copies of each Preliminary Prospectus and has consented to the
use of such copies for the purposes permitted by the Securities Act.
2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company hereby represents and warrants as follows:
(a) Each of the Company and its subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has full
corporate power and authority to own or lease its properties and
conduct its business as described in the Registration Statement and the
Prospectus and as currently being conducted, and is duly qualified as a
foreign corporation and in good standing in all jurisdictions in which
the character of the property owned or leased or the nature of the
business transacted by it makes qualification necessary (except where
the failure to be so qualified would not have a material adverse effect
on the business, operations, financial condition or income of the
Company and its subsidiaries, taken as a whole). The outstanding shares
of capital stock of each such subsidiary have been duly authorized and
validly issued, are fully paid and nonassessable and are owned by the
Company free and clear of all liens, encumbrances and security
interests; and no options, warrants or other rights to purchase,
agreements or other obligations to issue or other rights to convert any
obligations into shares of capital stock or ownership interests in any
such subsidiary are outstanding.
(b) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not
been any material ladverse change in the business, operations,
financial condition, income or business prospects of the Company and
its subsidiaries taken as a whole, whether or not arising from
transactions in the ordinary course of business, other than as set
forth in the Registration Statement and the Prospectus, and since such
dates, except in the ordinary course of business, neither the Company
nor any of its subsidiaries has entered into any material transaction
not referred to in the Registration Statement and the Prospectus.
(c) The Commission has not issued any order preventing or
suspending the use of any Preliminary Prospectus or the Prospectus, nor
instituted proceedings for that purpose. The Registration Statement and
the Prospectus comply, and on the Closing Date (as hereinafter defined)
and any later date on which Option Stock is to be purchased, the
Prospectus will comply in all material respects with the provisions of
the Securities Act and the rules and regulations of the Commission
thereunder; on the Effective Date and on the Closing Date and any later
date on which Option Stock may be purchased, neither the Registration
Statement nor any amendment thereto, and neither the Prospectus nor any
supplements thereto, contains or will contain any untrue statement of a
material fact or omits or will omit to state any material fact required
to be stated therein or necessary in order to make the statements
therein not misleading; provided, however, that none of the
representations and warranties in this subparagraph (iii) shall apply
to
3
statements in, or omissions from, the Registration Statement or the
Prospectus made in reliance upon and in conformity with information
herein or otherwise furnished in writing to the Company by or on behalf
of the Underwriters for use in the Registration Statement or the
Prospectus. There are no contracts or documents of the Company which
would be required by the Securities Act or by the rules and regulations
of the Commission to be filed as exhibits to the Registration Statement
which have not been so filed.
(d) The capitalization of the Company is, and upon
consummation of the transactions contemplated hereby will be, as set
forth in the Prospectus under the caption "Capitalization"; the
outstanding shares of Common Stock of the Company have been duly
authorized and validly issued and are fully paid and non-assessable;
the capital stock of the Company conforms to the description thereof in
the Registration Statement under the caption "Description of Capital
Stock"; the Stock is duly and validly authorized, is (or, in the case
of shares of the Stock to be sold by the Company, will be, when issued
and sold to the Underwriters as provided herein) duly and validly
issued, fully paid, nonassessable, free of pre-emptive rights and
conforms to the description thereof in the Prospectus. There are no
outstanding options, warrants or other rights granted to or by the
Company to purchase shares of Common Stock or other securities of the
Company other than as described in the Registration Statement; and no
such option, warrant or other right has been granted to any person, the
exercise of which would cause such person to own more than five percent
of the Common Stock outstanding immediately after the offering other
than as described in the Prospectus. No person or entity holds a right
to require or participate in the registration under the Securities Act
of shares of Common Stock of the Company which right has not been
waived by the holder thereof as of the date hereof with respect to the
registration of shares pursuant to the Registration Statement, and
except as described in the Prospectus, no person holds a right to
require registration under the Securities Act of shares of Common Stock
of the Company at any other time. No person or entity has a right of
participation with respect to the sale of shares of the Stock by the
Company. No further approval or authority of the stockholders or the
Board of Directors of the Company will be required for the issuance and
sale of the Stock as contemplated herein.
(e) The Company and its subsidiaries now hold, and at the
Closing Date (as defined in Section 5(a) hereof) will hold, all
material licenses, certificates and permits from state, federal and
other regulatory authorities which are necessary for the conduct of the
business of the Company and its subsidiaries taken as a whole; neither
the Company nor any of its subsidiaries is in violation of its
corporate charter or by-laws, or in default in the performance or
observance of any provision of any obligation, agreement, covenant or
condition contained in any bond, debenture or in any contract,
indenture, mortgage, loan agreement, joint venture or other agreement
or instrument to which the Company or such subsidiary is a party or by
which it or any of its properties is bound or, to the best of the
Company's knowledge, is in violation of any law, order, rule,
regulation, writ, injunction or decree of any government, governmental
instrumentality or court, domestic or foreign.
(f) The Company owns, or possesses adequate rights to use or
sublicense, all patents, patent rights, inventions, trade secrets,
licenses, know- how, proprietary techniques, including processes,
trademarks, service marks, trade names, copyrights and other
intellectual property described or referred to in the Registration
Statement and the Prospectus as owned or used by it or which are
necessary for the conduct of its business as now conducted and as
described in the Registration Statement and the Prospectus. All such
patents, patent rights, licenses, trademarks, service marks and
copyrights are (i) valid and enforceable and (ii) not being infringed
by any third parties which infringement could, whether singly or in the
aggregate, materially and adversely affect the business, properties,
operations, condition (financial or otherwise), results of operations,
income or business prospects or the Company, as presently being
conducted or as proposed to be conducted in
4
the Prospectus. The Company has no knowledge of, nor has it received
any notice of, infringement of or conflict with asserted rights of
others with respect to any patents, patent rights, inventions, trade
secrets, licenses, know-how, proprietary techniques, including
processes and substances, trademarks, service marks, trade names,
copyrights or other intellectual property which, singly or in the
aggregate, is, or is reasonably likely to be, the subject of an
unfavorable decision, ruling or finding that could materially and
adversely affect the business, properties, operations, condition
(financial or otherwise), results of operations, income or business
prospects of the Company, as now conducted or as proposed to be
conducted in the Registration Statement and the Prospectus.
(g) This Agreement has been duly authorized, executed and
delivered by the Company; the performance of this Agreement and the
consummation of the transactions herein contemplated will not result in
a breach or violation of any of the terms and provisions of, or
constitute a default under, (A) any indenture, mortgage, deed of trust,
loan agreement or other material agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the property
of the Company or any of the subsidiaries is bound, (B) the corporate
charter or by-laws of the Company or any of the subsidiaries or (C)
(assuming the making of all filings required under Rule 424(b) or Rule
430A and the due qualification of the Stock for public offering by the
Underwriters under state and foreign securities laws) any statute or
any order, rule or regulation of any court or governmental agency or
body having jurisdiction over the Company or any of the subsidiaries or
over the properties of the Company.
(h) Except as set forth in the Prospectus, there is not any
action, suit or proceeding, at law or in equity, pending against the
Company or any subsidiary before any court or administrative agency,
which, if determined adversely to the Company or any subsidiary, would
materially adversely affect the business, operations, financial
condition, income or business prospects of the Company and the
subsidiaries taken as a whole, or prevent consummation of the
transactions contemplated hereby.
(i) The consolidated financial statements of the Company and
its subsidiaries, together with the related notes and schedules as set
forth in the Registration Statement, present fairly the consolidated
financial position and the results of operations of the Company and its
subsidiaries, at the indicated dates and for the indicated periods.
Such financial statements have been prepared in accordance with
generally accepted accounting principles consistently applied
throughout the periods involved, and all adjustments necessary for a
fair presentation of results for such periods have been made. The
summary financial and statistical data included in the Registration
Statement present fairly the information shown therein and have been
compiled on a basis consistent with the financial statements presented
therein.
(j) The Company and its subsidiaries have filed all federal,
state and foreign income tax returns which have been required to be
filed (or have filed extensions therefor or obtained any required
extensions in connection therewith), and have paid all taxes indicated
by said returns and all assessments received by them or any of them to
the extent that such taxes have become due and are not being contested
in good faith.
(k) Each approval, consent, order, authorization, designation,
declaration or filing by or with any United States regulatory,
administrative or other governmental body necessary in connection with
the execution and delivery by the Company of this Agreement and the
consummation by the Company of the transactions herein contemplated
(except (A) such additional steps as may be required by the National
Association of Securities Dealers, Inc. (the "NASD"), (B) as may be
necessary to make the Registration Statement effective (and to maintain
such effectiveness) and to qualify the Stock for public offering by the
Underwriters under state and foreign securities laws or
5
(C) filings required under Rule 424(b) or Rule 430(A)) has been
obtained or made and is in full force and effect.
(l) KPMG Peat Marwick LLP, who have certified the financial
statements filed with the Commission as part of the Registration
Statement, are independent public accountants as required by the
Securities Act and the rules and regulations thereunder.
(m) The Company and the subsidiaries have good and marketable
title to all of the properties and assets reflected in the financial
statements (or as described in the Registration Statement) described as
owned by them, subject to no lien, mortgage, pledge, charge or
encumbrance of any kind except those reflected in such financial
statements (or as described in the Registration Statement) or which are
not material in amount.
(n) Neither the Company nor any of its subsidiaries is
involved in any material labor dispute nor, to the knowledge of the
Company, is any such dispute threatened.
(o) The Common Stock is registered pursuant to Section 12(g)
of the Securities Exchange Act of 1934, as amended (hereinafter the
Exchange Act), and is listed on the Nasdaq National Market, and the
Company has taken no action designed to, or likely to have the effect
of, terminating the registration of the Common Stock under the Exchange
Act or delisting the Common Stock from the Nasdaq National Market, nor
has the Company received any notification that the Commission or the
NASD is contemplating terminating such registration or listing has been
approved, subject to notice of issuance of the Stock.
(p) Neither the Company nor, to its knowledge, any of its
officers, directors or affiliates have taken, and at the Closing Date
and at each purchase of the Option Stock, neither the Company nor, to
its knowledge, any of its officers, directors or affiliates will have
taken, directly or indirectly, any action which has constituted, or
might reasonably be expected to constitute, the stabilization or
manipulation of the price of sale or resale of the Stock.
(q) Neither the Company nor any Subsidiary has been an
"investment company" or a company "controlled" by an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended.
(r) The Company has timely and properly filed with the
Commission all reports and other documents required to have been filed
with the Commission.
3. PURCHASE OF THE STOCK BY THE UNDERWRITERS.
(a) On the basis of the representations and warranties and subject to
the terms and conditions herein set forth, the Company agrees to issue and sell
2,000,000 shares of the Underwritten Stock to the several Underwriters, and each
of the Underwriters agrees to purchase from the Company the respective aggregate
number of shares of Underwritten Stock set forth opposite its name in Schedule
I. The price at which such shares of Underwritten Stock shall be sold by the
Company and purchased by the several Underwriters shall be $[_____] per share.
In making this Agreement, each Underwriter is contracting severally and not
jointly; except as provided in paragraphs (b) and (c) of this Section 3, the
agreement of each Underwriter is to purchase only the respective number of
shares of the Underwritten Stock specified in Schedule I.
(b) If for any reason one or more of the Underwriters shall fail or
refuse (otherwise than for a reason sufficient to justify the termination of
this Agreement under the provisions of Section 8 or 9 hereof) to purchase and
pay for the number of shares of the Stock agreed to be purchased by such
Underwriter or Underwriters,
6
the non-defaulting Underwriters shall have the right within twenty-four (24)
hours after receipt by you of such notice to purchase, or procure one or more
other Underwriters to purchase, in such proportions as may be agreed upon
between you and such purchasing Underwriter or Underwriters and upon the terms
herein set forth, all or any part of the shares of the Stock which such
defaulting Underwriter or Underwriters agreed to purchase. If the non-defaulting
Underwriters fail so to make such arrangements with respect to all such shares
and portion, the number of shares of the Stock which each non-defaulting
Underwriter is otherwise obligated to purchase under this Agreement shall be
automatically increased on a pro rata basis to absorb the remaining shares and
portion which the defaulting Underwriter or Underwriters agreed to purchase;
provided, however, that the non-defaulting Underwriters shall not be obligated
to purchase the shares and portion which the defaulting Underwriter or
Underwriters agreed to purchase if the aggregate number of such shares of the
Stock exceeds 10% of the total number of shares of the Stock which all
Underwriters agreed to purchase hereunder. If the total number of shares of the
Stock which the defaulting Underwriter or Underwriters agreed to purchase shall
not be purchased or absorbed in accordance with the two preceding sentences, the
Company shall have the right, within twenty-four (24) hours next succeeding the
24-hour period above referred to, to make arrangements with other underwriters
or purchasers satisfactory to you for purchase of such shares and portion on the
terms herein set forth. In any such case, either you or the Company shall have
the right to postpone the Closing Date determined as provided in Section 5
hereof for not more than seven business days after the date originally fixed as
the Closing Date pursuant to said Section 5 in order that any necessary changes
in the Registration Statement, the Prospectus or any other documents or
arrangements may be made. If neither the non-defaulting Underwriters nor the
Company shall make arrangements within the 24-hour periods stated above for the
purchase of all the shares of the Stock which the defaulting Underwriter or
Underwriters agreed to purchase hereunder, this Agreement shall be terminated
without further act or deed and without any liability on the part of the Company
to any non-defaulting Underwriter and without any liability on the part of any
non-defaulting Underwriter to the Company. Nothing in this paragraph (b), and no
action taken hereunder, shall relieve any defaulting Underwriter from liability
in respect of any default of such Underwriter under this Agreement.
(c) On the basis of the representations, warranties and covenants
herein contained, and subject to the terms and conditions herein set forth, the
Company grants an option to the several Underwriters to purchase, severally and
not jointly, up to 300,000 shares in the aggregate, of the Option Stock from the
Company at the same price per share as the Underwriters shall pay for the
Underwritten Stock. Said option may be exercised only to cover over-allotments
in the sale of the Underwritten Stock by the Underwriters and may be exercised
in whole or in part at any time (but not more than once) on or before the 30th
day after the date of this Agreement upon written or telegraphic notice by you
to the Company setting forth the aggregate number of shares of the Option Stock
as to which the several Underwriters are exercising the option. Delivery of
certificates for the shares of Option Stock, and payment therefor, shall be made
as provided in Section 5 hereof. The number of shares of the Option Stock to be
purchased by each Underwriter shall be the same percentage of the total number
of shares of the Option Stock to be purchased by the several Underwriters as
such Underwriter is purchasing of the Underwritten Stock, as adjusted by you in
such manner as you deem advisable to avoid fractional shares.
4. OFFERING BY UNDERWRITERS.
(a) The terms of the public offering by the Underwriters of the Stock
to be purchased by them shall be as set forth in the Prospectus. The
Underwriters may from time to time change the public offering price after the
closing of the public offering and increase or decrease the concessions and
discounts to dealers as they may determine.
(b) The information set forth in the last paragraph on the front cover
page and under "Underwriting" in the Registration Statement, any Preliminary
7
Prospectus or the Prospectus relating to the Stock (insofar as such information
relates to the Underwriters) constitutes the only information furnished by the
Underwriters to the Company for inclusion in the Registration Statement, any
Preliminary Prospectus, and the Prospectus, and you on behalf of the respective
Underwriters represent and warrant to the Company that the statements made
therein are correct.
5. DELIVERY OF AND PAYMENT FOR THE STOCK.
(a) Delivery of certificates for the shares of the Underwritten Stock
and the (if the option granted by Section 3(c) hereof shall have been exercised
not later than 7:00 a.m., San Francisco time, on the date two business days
preceding the Closing Date), and payment therefor, shall be made at the office
of Xxxx and Xxxx LLP, 00 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 at 7:00 a.m.,
San Francisco time, on the fourth business day after the date of this Agreement,
or at such time on such other day, not later than seven full business days after
such fourth business day, as shall be agreed upon in writing by the Company and
you. The date and hour of such delivery and payment (which may be postponed as
provided in Section 3(b) hereof) are herein called the Closing Date.
(b) If the option granted by Section 3(c) hereof shall be exercised
after 7:00 a.m., San Francisco time, on the date two business days preceding the
Closing Date, and on or before the 30th day after the date of this Agreement,
delivery of certificates for the shares of Option Stock, and payment therefor,
shall be made at the office of Xxxx and Xxxx LLP, 00 Xxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000 at 7:00 a.m., San Francisco time, on the third business day
after the exercise of such option.
(c) Payment for the Stock purchased from the Company shall be made to
the Company or its order by one or more wire transfers or one or more certified
or official bank check or checks in same day funds. Such payment shall be made
upon delivery of certificates for the Stock to you for the respective accounts
of the several Underwriters against receipt therefor signed by you. Certificates
for the Stock to be delivered to you shall be registered in such name or names
and shall be in such denominations as you may request at least one business day
before the Closing Date, in the case of Underwritten Stock, and at least one
business day prior to the purchase thereof, in the case of the Option Stock.
Such certificates will be made available to the Underwriters for inspection,
checking and packaging at the offices of Lewco Securities Corporation, 0
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 not less than one full business day prior to
the Closing Date or, in the case of the Option Stock, by 3:00 p.m., New York
time, on the business day preceding the date of purchase.
It is understood that you, individually and not on behalf of the
Underwriters, may (but shall not be obligated to) make payment to the Company
for shares to be purchased by any Underwriter whose check shall not have been
received by you on the Closing Date or any later date on which Option Stock is
purchased for the account of such Underwriter. Any such payment by you shall not
relieve such Underwriter from any of its obligations hereunder.
6. FURTHER AGREEMENTS OF THE COMPANY. The Company covenants and agrees
as follows:
(a) The Company will (i) prepare and timely file with the Commission
under Rule 424(b) a Prospectus containing information previously omitted at the
time of effectiveness of the Registration Statement in reliance on Rule 430A and
(ii) not file any amendment to the Registration Statement or supplement to the
Prospectus of which you shall not previously have been advised and furnished
with a copy or to which you shall have reasonably objected in writing or which
is not in compliance in all material respects with the Securities Act or the
rules and regulations of the Commission.
(b) The Company will promptly notify each Underwriter in the event of
(i) the request by the Commission for amendment of the Registration Statement or
8
for supplement to the Prospectus or for any additional information, (ii) the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement, (iii) the institution or notice of intended institution
of any action or proceeding for that purpose, (iv) the receipt by the Company of
any notification with respect to the suspension of the qualification of the
Stock for sale in any jurisdiction, or (v) the receipt by the Company of notice
of the initiation or threatening of any proceeding for such purpose. The Company
will make every reasonable effort to prevent the issuance of such a stop order
and, if such an order shall at any time be issued, to obtain the withdrawal
thereof at the earliest possible moment.
(c) The Company will (i) on or before the Closing Date, deliver to you
a signed copy of the Registration Statement as originally filed and of each
amendment thereto filed prior to the time the Registration Statement becomes
effective and, promptly upon the filing thereof, a signed copy of each
post-effective amendment, if any, to the Registration Statement (together with,
in each case, all exhibits thereto unless previously furnished to you) and will
also deliver to you, for distribution to the Underwriters, a sufficient number
of additional conformed copies of each of the foregoing (but without exhibits)
so that one copy of each may be distributed to each Underwriter, (ii) as
promptly as possible deliver to you and send to the several Underwriters, at
such office or offices as you may designate, as many copies of the Prospectus as
you may reasonably request, and (iii) thereafter from time to time during the
period in which a prospectus is required by law to be delivered by an
Underwriter or dealer, likewise send to the Underwriters as many additional
copies of the Prospectus and as many copies of any supplement to the Prospectus
and of any amended prospectus, filed by the Company with the Commission, as you
may reasonably request for the purposes contemplated by the Securities Act. The
copies of the Registration Statement, any Preliminary Prospectus or Prospectus
and each amendment or supplement thereto furnished to the Underwriters will be
identical to the electronically transmitted copies thereof filed with the
Commission pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(d) If at any time during the period in which a prospectus is required
by law to be delivered by an Underwriter or dealer any event relating to or
affecting the Company, or of which the Company shall be advised in writing by
you, shall occur as a result of which it is necessary, in the reasonable opinion
of counsel for the Company or of counsel for the Underwriters, to supplement or
amend the Prospectus in order to make the Prospectus not misleading in the light
of the circumstances existing at the time it is delivered to a purchaser of the
Stock, the Company will forthwith prepare and file with the Commission a
supplement to the Prospectus or an amended prospectus so that the Prospectus as
so supplemented or amended will not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances existing at the time such
Prospectus is delivered to such purchaser, not misleading. If, after the public
offering of the Stock by the Underwriters and during such period, the
Underwriters shall propose to vary the terms of offering thereof by reason of
changes in general market conditions or otherwise, you will advise the Company
in writing of the proposed variation, and, if in the reasonable opinion either
of counsel for the Company or of counsel for the Underwriters such proposed
variation requires that the Prospectus be supplemented or amended, the Company
will forthwith prepare and file with the Commission a supplement to the
Prospectus or an amended prospectus setting forth such variation. The Company
authorizes the Underwriters and all dealers to whom any of the Stock may be sold
by the several Underwriters to use the Prospectus, as from time to time amended
or supplemented, in connection with the sale of the Stock in accordance with the
applicable provisions of the Securities Act and the applicable rules and
regulations thereunder for such period.
(e) Prior to the filing thereof with the Commission, the Company will
submit to you, for your information, a copy of any post-effective amendment to
the Registration Statement and any supplement to the Prospectus or any amended
prospectus proposed to be filed.
9
(f) The Company will cooperate, when and as requested by you, in the
qualification of the Stock for offer and sale under the securities or blue sky
laws of such jurisdictions as you may designate and, during the period in which
a prospectus is required by law to be delivered by an Underwriter or dealer, in
keeping such qualifications in good standing under said securities or blue sky
laws; provided, however, that the Company shall not be obligated to file any
general consent to service of process or to qualify as a foreign corporation in
any jurisdiction in which it is not so qualified. The Company will, from time to
time, prepare and file such statements, reports, and other documents as are or
may be required to continue such qualifications in effect for so long a period
as you may reasonably request for distribution of the Stock.
(g) During a period of five years commencing with the date hereof, the
Company will furnish to you, and to each Underwriter who may so request in
writing, copies of all periodic and special reports furnished to stockholders of
the Company and of all information, documents and reports filed with the
Commission.
(h) The Company agrees to pay all costs and expenses incident to the
performance of its obligations under this Agreement, including all costs and
expenses incident to (i) the preparation, printing and filing with the
Commission and the NASD of the Registration Statement, any Preliminary
Prospectus and the Prospectus, (ii) the furnishing to the Underwriters of copies
of any Preliminary Prospectus and of the several documents required by paragraph
(c) of this Section 6 to be so furnished, (iii) the printing of this Agreement
and related documents delivered to the Underwriters, (iv) the preparation,
printing and filing of all supplements and amendments to the Prospectus referred
to in paragraph (d) of this Section 6, (v) the furnishing to you and the
Underwriters of the reports and information referred to in paragraph (g) of this
Section 6 and (vi) the printing and issuance of stock certificates, including
the transfer agent's fees.
(i) The Company agrees to reimburse you, for the account of the several
Underwriters, for blue sky fees and related disbursements (including reasonable
counsel fees and disbursements and cost of printing memoranda for the
Underwriters) paid by or for the account of the Underwriters or their counsel in
qualifying the Stock under state securities or blue sky laws and for filing fees
incident to the review of the offering by the NASD.
(j) The Company agrees that, without the prior written consent of
Xxxxxxxxx & Xxxxx LLC on behalf of the Underwriters, the Company will not, for a
period of 90 days following the Effective Date, directly or indirectly, (i)
sell, offer, contract to sell, make any short sale, pledge, sell any option or
contract to purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase or otherwise transfer or dispose of any shares of
Common Stock or any securities convertible into or exchangeable or exercisable
for or any rights to purchase or acquire Common Stock or (ii) enter into any
swap or other agreement that transfers, in whole or in part, any of the economic
consequences or ownership of Common Stock, whether any such transaction
described in clause (i) or (ii) above is settled by delivery of Common Stock or
such other securities, in cash or otherwise. The foregoing sentence shall not
apply to (i) the Stock to be sold to the Underwriters pursuant to this
Agreement, (ii) shares of Common Stock issued by the Company upon the exercise
of options granted under the stock option plans of the Company (the "Option
Plans") or upon the exercise of options outstanding as of the date hereof, all
as described in the Prospectus and (iii) options to purchase Common Stock
granted under the Option Plans. For purposes of this paragraph (k), a sale,
offer, or other disposition shall be deemed to include any sale to an
institution which can, following such sale, sell Common Stock to the public in
reliance on Rule 144A.
(k) Until the termination of the offering of the Stock, the Company
will timely file all documents, and any amendments to previously filed
documents, required to be filed by it pursuant to Sections 13, 14 or 15(d) of
the Exchange Act.
10
(l) The Company is familiar with the Investment Company Act of 1940, as
amended, and has in the past conducted its affairs, and will in the future
conduct its affairs, in such a manner to ensure that the Company was not and
will not be an "investment company" or a company "controlled" by an "investment
company" within the meaning of the Investment Company Act of 1940, as amended,
and the rules and regulations thereunder.
(m) Not later than the 45th day following the end of the fiscal quarter
first occurring after the first anniversary of the "effective date of the
Registration Statement" (as defined in Rule 158(c) of the Securities Act), the
Company will make generally available an earnings statement in accordance with
Section 11(a) of the Securities Act and Rule 158 thereunder.
(n) The Company covenants that it will not, any time prior to April 30,
1999 (i) invest more than 25% in book value of its liquid assets, as outstanding
from time to time, in securities or instruments with a maturity greater than one
year ("Long-term Securities") or (ii) enter into any margin loan or similar
financing arrangement pursuant to which securities or instruments in which the
Company has invested proceeds of the offering are pledged to secure
indebtedness, other than with a commercial bank or insurance company. With
respect to the Long-term Securities, such securities, during the period set
forth above, shall be investment-grade (as such term is defined by Standard &
Poor's), interest-bearing, denominated in U.S. dollars and have a maturity
within ten years of the date of purchase by the Company.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) Subject to the provisions of paragraph (f) below, the Company agree
to indemnify and hold harmless each Underwriter and each person (including each
partner or officer thereof) who controls any Underwriter within the meaning of
Section 15 of the Securities Act from and against any and all losses, claims,
damages or liabilities, joint or several, to which such indemnified parties or
any of them may become subject under the Securities Act, the Exchange Act, or
the common law or otherwise, and the Company agrees to reimburse each such
Underwriter and controlling person for any legal or other expenses (including,
except as otherwise hereinafter provided, reasonable fees and disbursements of
counsel) incurred by the respective indemnified parties in connection with
defending against any such losses, claims, damages or liabilities or in
connection with any investigation or inquiry of, or other proceeding which may
be brought against, the respective indemnified parties, in each case arising out
of or based upon (i) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement (including the Prospectus
as part thereof and any Rule 462(b) registration statement) or any post-
effective amendment thereto (including any Rule 462(b) registration statement),
or the omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading, or
(ii) any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus or the Prospectus (as amended or as
supplemented if the Company shall have filed with the Commission any amendment
thereof or supplement thereto) or the omission or alleged omission to state
therein a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
provided, however, that (1) the indemnity agreements of the Company contained in
this paragraph (a) shall not apply to any such losses, claims, damages,
liabilities or expenses if such statement or omission was made in reliance upon
and in conformity with information furnished as herein stated or otherwise
furnished in writing to the Company by or on behalf of any Underwriter for use
in any Preliminary Prospectus or the Registration Statement or the Prospectus or
any such amendment thereof or supplement thereto, and (2) the indemnity
agreement contained in this paragraph (a) with respect to any Preliminary
Prospectus shall not inure to the benefit of any Underwriter from whom the
person asserting any such losses, claims, damages, liabilities or expenses
purchased the Stock which is the subject thereof (or to the benefit of any
person controlling such Underwriter) if at or prior to the written confirmation
of the sale of such Stock a copy of the Prospectus (or the Prospectus as amended
or supplemented) was not sent or delivered to such person and the untrue
statement or omission of a material fact contained in such Preliminary
Prospectus was corrected in the Prospectus (or the Prospectus as
11
amended or supplemented) unless the failure is the result of noncompliance by
the Company with paragraph (c) of Section 6 hereof. The indemnity agreement of
the Company contained in this paragraph (a) and the representations and
warranties of the Company contained in Section 2 hereof shall remain operative
and in full force and effect regardless of any investigation made by or on
behalf of any indemnified party and shall survive the delivery of any payment
for the Stock.
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, each of its officers who signs the Registration Statement on his
own behalf or pursuant to a power of attorney, each of its directors, and each
other Underwriter and each person (including each partner or officer thereof)
who controls the Company or any such other Underwriter within the meaning of
Section 15 of the Securities Act from and against any and all losses, claims,
damages or liabilities, joint or several, to which such indemnified parties or
any of them may become subject under the Securities Act, the Exchange Act, or
the common law or otherwise and to reimburse each of them for any legal or other
expenses (including, except as otherwise hereinafter provided, reasonable fees
and disbursements of counsel) incurred by the respective indemnified parties in
connection with defending against any such losses, claims, damages or
liabilities or in connection with any investigation or inquiry of, or other
proceeding which may be brought against, the respective indemnified parties, in
each case arising out of or based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(including the Prospectus and any 462(b) registration statement as part thereof)
or any post-effective amendment thereto (including any 462(b) registration
statement) or the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading or (ii) any untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus or the Prospectus (as
amended or as supplemented if the Company shall have filed with the Commission
any amendment thereof or supplement thereto) or the omission or alleged omission
to state therein a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, if such statement or omission was made in reliance upon and in
conformity with information furnished as herein stated or otherwise furnished in
writing to the Company by or on behalf of such indemnifying Underwriter for use
in the Registration Statement or the Prospectus or any such amendment thereof or
supplement thereto. The indemnity agreement of each Underwriter contained in
this paragraph (b) shall remain operative and in full force and effect
regardless of any investigation made by or on behalf of any indemnified party
and shall survive the delivery of and payment for the Stock.
(c) Each party indemnified under the provision of paragraphs (a) and
(b) of this Section 7 agrees that, upon the service of a summons or other
initial legal process upon it in any action or suit instituted against it or
upon its receipt of written notification of the commencement of any
investigation or inquiry of, or proceeding against it, in respect of which
indemnity may be sought on account of any indemnity agreement contained in such
paragraphs, it will promptly give written notice (herein called the Notice) of
such service or notification to the party or parties from whom indemnification
may be sought hereunder. No indemnification provided for in such paragraphs
shall be available to any party who shall fail so to give the Notice if the
party to whom such Notice was not given was unaware of the action, suit,
investigation, inquiry or proceeding to which the Notice would have related and
was prejudiced by the failure to give the Notice, but the omission so to notify
such indemnifying party or parties of any such service or notification shall not
relieve such indemnifying party or parties from any liability which it or they
may have to the indemnified party for contribution or otherwise than on account
of such indemnity agreement. Any indemnifying party shall be entitled at its own
expense to participate in the defense of any action, suit or proceeding against,
or investigation or inquiry of, an indemnified party. Any indemnifying party
shall be entitled, if it so elects within a reasonable time after
12
receipt of the Notice by giving written notice (herein called the Notice of
Defense) to the indemnified party, to assume (alone or in conjunction with any
other indemnifying party or parties) the entire defense of such action, suit,
investigation, inquiry or proceeding, in which event such defense shall be
conducted, at the expense of the indemnifying party or parties, by counsel
chosen by such indemnifying party or parties and reasonably satisfactory to the
indemnified party or parties; provided, however, that (i) if the indemnified
party or parties reasonably determine that there may be a conflict between the
positions of the indemnifying party or parties and of the indemnified party or
parties in conducting the defense of such action, suit, investigation, inquiry
or proceeding or that there may be legal defenses available to such indemnified
party or parties different from or in addition to those available to the
indemnifying party or parties, then counsel for the indemnified party or parties
shall be entitled to conduct the defense to the extent reasonably determined by
such counsel to be necessary to protect the interests of the indemnified party
or parties and (ii) in any event, the indemnified party or parties shall be
entitled, to have counsel chosen by such indemnified party or parties
participate in, but not conduct, the defense. If, within a reasonable time after
receipt of the Notice, an indemnifying party gives a Notice of Defense and the
counsel chosen by the indemnifying party or parties is reasonably satisfactory
to the indemnified party or parties, the indemnifying party or parties will not
be liable under paragraphs (a) through (c) of this Section 7 for any legal or
other expenses subsequently incurred by the indemnified party or parties in
connection with the defense of the action, suit, investigation, inquiry or
proceeding, except that (A) the indemnifying party or parties shall bear the
legal and other expenses of not more than one separate counsel for the
indemnified party or parties incurred in connection with the conduct of the
defense as referred to in clause (i) of the proviso to the preceding sentence
and (B) the indemnifying party or parties shall bear such other expenses as it
or they have authorized to be incurred by the indemnified party or parties. If,
within a reasonable time after receipt of the Notice, no Notice of Defense has
been given, the indemnifying party or parties shall be responsible for any legal
or other expenses incurred by the indemnified party or parties in connection
with the defense of the action, suit, investigation, inquiry or proceeding.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
paragraph (a) or (b) of this Section 7, then each indemnifying party shall, in
lieu of indemnifying such indemnified party, contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in paragraph (a) or (b) of this Section 7 (i) in such
proportion as is appropriate to reflect the relative benefits received by each
indemnifying party from the offering of the Stock or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of each indemnifying party in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, or actions in respect thereof, as well as any
other relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriters on the other shall be deemed to be
in the same respective proportions as the total net proceeds from the offering
of the Stock received by the Company and the total underwriting discount
received by the Underwriters, as set forth in the table on the cover page of the
Prospectus, bear to the aggregate public offering price of the Stock. Relative
fault shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by each
indemnifying party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission.
The parties agree that it would not be just and equitable if
contributions pursuant to this paragraph (d) were to be determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to in the first sentence of this paragraph
(d). The amount paid by an indemnified party as a result of the losses, claims,
damages or liabilities, or actions
13
in respect thereof, referred to in the first sentence of this paragraph (d)
shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in connection with investigation, preparation to defend
or defense against any action or claim which is the subject of this paragraph
(d). Notwithstanding the provisions of this paragraph (d), no Underwriter shall
be required to contribute any amount in excess of the underwriting discount
applicable to the Stock purchased by such Underwriter. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations in
this paragraph (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
Each party entitled to contribution agrees that upon the service of a
summons or other initial legal process upon it in any action instituted against
it in respect of which contribution may be sought, it will promptly give written
notice of such service to the party or parties from whom contribution may be
sought, but the omission so to notify such party or parties of any such service
shall not relieve the party from whom contribution may be sought from any
obligation it may have hereunder or otherwise (except as specifically provided
in paragraph (c) of this Section 7).
(e) The Company will not, without the prior written consent of each
Underwriter, settle or compromise or consent to the entry of any judgment in any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification may be sought hereunder (whether or not such Underwriter or any
person who controls such Underwriter within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act is a party to such claim,
action, suit or proceeding) unless such settlement, compromise or consent
includes an unconditional release of such Underwriter and each such controlling
person from all liability arising out of such claim, action, suit or proceeding.
No Underwriter shall be liable for any settlement of any proceeding entered into
without its written consent.
8. TERMINATION. This Agreement may be terminated by you at any time
prior to the Closing Date by giving written notice to the Company if after the
date of this Agreement trading in the Common Stock shall have been suspended, or
if there shall have occurred (i) the engagement in hostilities or an escalation
of major hostilities by the United States or the declaration of war or a
national emergency by the United States on or after the date hereof, (ii) any
outbreak of hostilities or other national or international calamity or crisis or
change in economic or political conditions if the effect of such outbreak,
calamity, crisis or change in economic or political conditions in the financial
markets of the United States would, in the Underwriters' reasonable judgment,
make the offering or delivery of the Stock impracticable, (iii) suspension of
trading in securities generally or a material adverse decline in the value of
securities generally on the New York Stock Exchange, the American Stock
Exchange, or the Nasdaq National Market, or limitation on prices (other than
limitations on hours or numbers of days of trading) for securities on either
such exchange or system, (iv) the enactment, publication, decree or other
promulgation of any federal or state statute, regulation, rule or order of, or
commencement of any proceeding or investigation by, any court, legislative body,
agency or other governmental authority which in the Underwriters' reasonable
opinion materially and adversely affects or will materially or adversely affect
the business or operations of the Company, (v) declaration of a banking
moratorium by either federal or New York State authorities or (vi) the taking of
any action by any federal, state or local government or agency in respect of its
monetary or fiscal affairs which in the Underwriters' reasonable opinion has a
material adverse effect on the securities markets in the United States. If this
Agreement shall be terminated pursuant to this Section 8, there shall be no
liability of the Company to the Underwriters and no liability of the
Underwriters to the Company; provided, however, that in the event of any such
termination the Company agrees to indemnify and hold harmless the Underwriters
from all costs or expenses incident to the
14
performance of the obligations of the Company under this Agreement, including
all costs and expenses referred to in paragraphs (h) and (i) of Section 6
hereof.
9. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of the
several Underwriters to purchase and pay for the Stock shall be subject to the
performance by the Company of all obligations to be performed hereunder at or
prior to the Closing Date or any later date on which Option Stock is to be
purchased, as the case may be, and to the following further conditions:
(a) The Registration Statement shall have become effective; and no stop
order suspending the effectiveness thereof shall have been issued and no
proceedings therefor shall be pending or threatened by the Commission.
(b) The legality and sufficiency of the sale of the Stock hereunder and
the validity and form of the certificates representing the Stock, all corporate
proceedings and other legal matters incident to the foregoing, and the form of
the Registration Statement and of the Prospectus (except as to the financial
statements contained therein), shall have been approved at or prior to the
Closing Date by Xxxx and Xxxx LLP, counsel for the Underwriters.
(c) You shall have received from Xxxxxxxx Ingersoll Professional
Corporation, counsel for the Company, an opinion, addressed to the Underwriters
and dated the Closing Date, covering the matters set forth in Annex A hereto. If
Option Stock is purchased at any date after the Closing Date, you shall receive
an additional opinion from the aforementioned counsel, addressed to the
Underwriters and dated such later date, confirming that the statements expressed
as of the Closing Date in each such opinion remain valid as of such later date.
(d) You shall be satisfied that (i) as of the Effective Date, the
statements made in the Registration Statement and the Prospectus were true and
correct in all material respects and neither the Registration Statement nor the
Prospectus omitted to state any material fact required to be stated therein or
necessary in order to make the statements therein, respectively, not misleading,
(ii) since the Effective Date, no event has occurred which should have been set
forth in a supplement or amendment to the Prospectus which has not been set
forth in such a supplement or amendment, (iii) since the respective dates as of
which information is given in the Registration Statement in the form in which it
originally became effective and the Prospectus contained therein, there has not
been any material adverse change or any development involving a prospective
material adverse change in or affecting the business, properties, financial
condition or earnings of the Company and its subsidiaries as a whole, whether or
not arising from transactions in the ordinary course of business, and, since
such dates, except in the ordinary course of business, neither the Company nor
any of its subsidiaries has entered into any material transaction not referred
to in the Registration Statement in the form in which it originally became
effective and the Prospectus contained therein, (iv) neither the Company nor any
of its subsidiaries has any material contingent obligations which are not
disclosed in the Registration Statement and the Prospectus, (v) there are not
any pending or known threatened legal proceedings to which the Company or any of
its subsidiaries is a party or of which property of the Company or any of its
subsidiaries is the subject which are material and which are not disclosed in
the Registration Statement and the Prospectus, (vi) there are not any
franchises, contracts, leases or other documents which are required to be filed
as exhibits to the Registration Statement which have not been filed as required,
(vii) the representations and warranties of the Company herein are true and
correct in all material respects as of the Closing Date or any later date on
which Option Stock is to be purchased, as the case may be, and (viii) there has
not been any material change in the market for securities in general or in
political, financial or economic conditions from those reasonably foreseeable as
to render it impracticable in your reasonable judgment to make a public offering
of the Stock, or a material adverse change in market levels for securities in
general (or those of companies in particular) or financial or economic
conditions which render it inadvisable to proceed.
15
(e) You shall have received on the Closing Date and on any later date
on which Option Stock is purchased a certificate, dated the Closing Date or such
later date, as the case may be, and signed by the Chief Executive Officer and
the Chief Financial Officer of the Company, stating that the respective signers
of said certificate have carefully examined the Registration Statement in the
form in which it originally became effective and the Prospectus contained
therein and any supplements or amendments thereto, and that the statements
included in clauses (i) through (vii) of paragraph (d) of this Section 9 are
true and correct.
(f) You shall have received from KPMG Peat Marwick LLP, a letter or
letters, addressed to the Underwriters and dated the Closing Date and any later
date on which Option Stock is purchased, confirming that they are independent
public accountants with respect to the Company within the meaning of the
Securities Act and the applicable published rules and regulations thereunder and
based upon the procedures described in its letter delivered to you concurrently
with the execution of this Agreement (herein called the Original Letter), but
carried out to a date not more than five business days prior to the Closing Date
or such later date on which Option Stock is purchased (i) confirming, to the
extent true, that the statements and conclusions set forth in the Original
Letter are accurate as of the Closing Date or such later date, as the case may
be, and (ii) setting forth any revisions and additions to the statements and
conclusions set forth in the Original Letter which are necessary to reflect any
changes in the facts described in the Original Letter since the date of the
Original Letter or to reflect the availability of more recent financial
statements, data or information. The letters shall not disclose any change, or
any development involving a prospective change, in or affecting the business or
properties of the Company or any of its subsidiaries which, in your sole
judgment, makes it impractical or inadvisable to proceed with the public
offering of the Stock or the purchase of the Option Stock as contemplated by the
Prospectus.
(g) You shall have received from KPMG Peat Marwick LLP a letter stating
that their review of the Company's system of internal accounting controls, to
the extent they deemed necessary in establishing the scope of their examination
of the Company's financial statements as of and as at April 30, 1997 and October
31, 1997, did not disclose any weakness in internal controls that they
considered to be material weaknesses.
(h) You shall have been furnished evidence in usual written or
telegraphic form from the appropriate authorities of the several states, or
other evidence satisfactory to you, of the qualification referred to in
paragraph (f) of Section 6 hereof.
(i) Prior to the Closing Date, the Stock to be issued and sold by the
Company shall have been duly authorized for inclusion on the Nasdaq National
Market upon official notice of issuance.
(j) On or prior to the Closing Date, you shall have received from all
directors, executive officers, and beneficial holders (known to the Company) of
more than 5% of the outstanding Common Stock, stockholders agreements in form
reasonably satisfactory to Xxxxxxxxx & Xxxxx LLC, stating that without the prior
written consent of Xxxxxxxxx & Xxxxx LLC on behalf of the Underwriters, such
person or entity will not, for a period of 90 days following the Effective Date,
directly or indirectly (i) sell, offer, contract to sell, make any short sale,
pledge, sell any option or contract to purchase, purchase any option or contract
to sell, grant any option, right or warrant to purchase or otherwise transfer or
dispose of any shares of Common Stock or any securities convertible into or
exchangeable or exercisable for or any right to purchase or acquire Common Stock
or (ii) enter into any swap or other agreement that transfers, in whole or in
part, any of the economic consequences or ownership of Common Stock, whether any
such transaction described in clause (i) or (ii) above is to be settled by
delivery of Common Stock or such other securities, in cash or otherwise.
All the agreements, opinions, certificates and letters mentioned above
or elsewhere in this Agreement shall be deemed to be in compliance with the
16
provisions hereof only if Xxxx and Xxxx LLP, counsel for the Underwriters, shall
be reasonably satisfied that they comply in form and scope.
In case any of the conditions specified in this Section 9 shall not be
fulfilled, this Agreement may be terminated by you by giving notice to the
Company. Any such termination shall be without liability of the Company to the
Underwriters and without liability of the Underwriters to the Company; provided,
however, that (i) in the event of such termination, the Company agrees to
indemnify and hold harmless the Underwriters from all costs or expenses incident
to the performance of the obligations of the Company under this Agreement,
including all costs and expenses referred to in paragraphs (h) and (i) of
Section 6 hereof, and (ii) if this Agreement is terminated by you because of any
refusal, inability or failure on the part of the Company to perform any
agreement herein, to fulfill any of the conditions herein, or to comply with any
provision hereof other than by reason of a default by any of the Underwriters,
the Company will reimburse the Underwriters severally upon demand for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
that shall have been incurred by them in connection with transactions
contemplated hereby.
10. CONDITIONS OF THE OBLIGATION OF THE COMPANY. The obligation of the
Company to deliver the Stock shall be subject to the conditions that (a) the
Registration Statement shall have become effective and (b) no stop order
suspending the effectiveness thereof shall be in effect and no proceedings
therefor shall be pending or threatened by the Commission.
In case either of the conditions specified in this Section 10 shall not
be fulfilled, this Agreement may be terminated by the Company by giving notice
to you. Any such termination shall be without liability of the Company to the
Underwriters and without liability of the Underwriters to the Company; provided,
however, that (i) in the event of any such termination the Company agrees to
indemnify and hold harmless the Underwriters from all costs or expenses incident
to the performance of the obligations of the Company under this Agreement,
including all costs and expenses referred to in paragraphs (h) and (i) of
Section 6 hereof.
11. REIMBURSEMENT OF CERTAIN EXPENSES. In addition to its other
obligations under Section 7 of this Agreement, the Company hereby agrees to
reimburse on a quarterly basis the Underwriters for all reasonable legal and
other expenses incurred in connection with investigating or defending any claim,
action, investigation, inquiry or other proceeding arising out of or based upon
any statement or omission, or any alleged statement or omission, described in
paragraph (a) of Section 7 of this Agreement, notwithstanding the absence of a
judicial determination as to the propriety and enforceability of the obligations
under this Section 11 and the possibility that such payments might later be held
to be improper; provided, however, that (i) to the extent any such payment is
ultimately held to be improper, the persons receiving such payments shall
promptly refund them and (ii) such persons shall provide to the Company, upon
request, reasonable assurances of their ability to effect any refund, when and
if due.
12. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall
inure to the benefit of the Company, and the several Underwriters and, with
respect to the provisions of Section 7 hereof, the several parties (in addition
to the Company and the several Underwriters) indemnified under the provisions of
said Section 7, and their respective personal representatives, successors and
assigns. Nothing in this Agreement is intended or shall be construed to give to
any other person, firm or corporation any legal or equitable remedy or claim
under or in respect of this Agreement or any provision herein contained. The
term "successors and assigns" as herein used shall not include any purchaser, as
such purchaser, of any of the Stock from any of the several Underwriters.
13. NOTICES. Except as otherwise provided herein, all communications
hereunder shall be in writing or by telegraph and, if to the Underwriters, shall
be mailed, telegraphed or delivered to Xxxxxxxxx & Xxxxx LLC, Xxx Xxxx Xxxxxx,
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000; and if to the Company, shall be mailed,
telegraphed or
17
delivered to it at its office, Xxxx Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, XX
00000, Attention: Chief Executive Officer. All notices given by telegraph shall
be promptly confirmed by letter.
14. MISCELLANEOUS. The reimbursement, indemnification and contribution
agreements contained in this Agreement and the representations, warranties and
covenants in this Agreement shall remain in full force and effect regardless of
(a) any termination of this Agreement, (b) any investigation made by or on
behalf of any Underwriter or controlling person thereof, or by or on behalf of
the Company or its directors or officers, and (c) delivery and payment for the
Stock under this Agreement; provided, however, that if this Agreement is
terminated prior to the Closing Date, the provisions of paragraph (j) of Section
6 hereof shall be of no further force or effect.
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
This Agreement shall be governed by, and construed in accordance with,
the laws of the State of California.
18
Please sign and return to the Company the enclosed duplicates of this
letter, whereupon this letter will become a binding agreement among the Company
and the several Underwriters in accordance with its terms.
Very truly yours,
ANSOFT CORPORATION
By:
-----------------------------
Xxxxxxxx Xxxxxx
President and Chief Executive
Officer
The foregoing Agreement
is hereby confirmed and
accepted as of the date
first above written.
XXXXXXXXX & XXXXX LLC
XXXXXXX, XXXXXX & XXXXXXXXX, L.L.C.
By Xxxxxxxxx & Xxxxx LLC
By: ---------------------------
Managing Director
Acting on behalf of the several
Underwriters, including themselves,
named in Schedule I hereto.
19
SCHEDULE I
UNDERWRITERS
Number of Shares
to be
Underwriters Purchased
------------ ----------------
Xxxxxxxxx & Xxxxx LLC
Xxxxxxx, Xxxxxx & Xxxxxxxxx, L.L.C.
20
ANNEX A
MATTERS TO BE COVERED IN THE OPINION OF
XXXXXXXX INGERSOLL PROFESSIONAL CORPORATION
COUNSEL FOR THE COMPANY
(i) Each of the Company and its subsidiaries has been duly incorporated
and is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, is duly qualified as a foreign corporation in
each state of the United States of America in which its ownership or leasing of
property requires such qualification except where the failure to be so qualified
would not have a material adverse effect on the business, properties, financial
condition or results of operations of the Company and its subsidiaries taken as
a whole, and has full corporate power and authority to own or lease its
properties and to conduct its business as described in the Registration
Statement; all the issued and outstanding capital stock of each of the
subsidiaries has been duly authorized and validly issued and is fully paid and
nonassessable, and is owned by the Company free and clear of all liens,
encumbrances and security interests, and no options, warrants or other rights to
purchase, agreements or other obligations to issue or other rights to convert
any obligations into shares of capital stock or ownership interests in such
subsidiary are outstanding;
(ii) Following the closing of the sale of the Stock under the
Underwriting Agreement, the duly authorized capital stock of the Company
consists of [_________] shares of Preferred Stock, $.01 par value, of which no
shares are outstanding, and [__________] shares of Common Stock, $.01 par value,
of which there will be [___________] shares outstanding (including the
Underwritten Stock); proper corporate proceedings have been taken validly to
authorize such authorized capital stock; all of the outstanding shares of such
capital stock have been duly and validly issued and are fully paid and
nonassessable; the certificates evidencing the Stock delivered to the
Representatives for the several accounts of the Underwriters are in due and
proper form under Delaware law, and when duly countersigned by the Company's
transfer agent and registrar and delivered to you or upon your order against
payment of the agreed consideration therefor in accordance with the provisions
of the Underwriting Agreement, the Stock represented thereby will be duly
authorized and validly issued, fully paid and non-assessable; any Option Stock
purchased after the Closing Date when issued and delivered to and paid for by
the Underwriters as provided in the Underwriting Agreement, will have been duly
and validly issued and fully paid and non-assessable; no preemptive rights of,
or rights of refusal in favor of, stockholders exist with respect to the Stock,
or the issuance and sale thereof, pursuant to the Certificate of Incorporation
or By-Laws of the Company and, to such counsel's knowledge, there are no
contractual preemptive rights with respect to the issuance and sale of the Stock
that have not been waived or rights of first refusal or rights of co-sale which
exist with respect to the issuance and sale of the Stock;
(iii) The Registration Statement has become effective under the
Securities Act and, to such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement or suspending or preventing the use
of the Prospectus is in effect and no proceedings for that purpose have been
instituted or are pending or threatened by the Commission;
(iv) the Registration Statement and the Prospectus (except as to the
financial statements and schedules and other financial data contained therein,
as to which such counsel need express no opinion) comply as to form in all
material respects with the requirements of the Securities Act and with the rules
and regulations of the Commission thereunder;
(v) the information required to be set forth in the Registration
Statement in answer to Item 9, Item 10 (insofar as it relates to such counsel)
and Item 11(c) of Form
21
S-1 is to such counsel's knowledge accurately and adequately set forth therein
in all material respects or no response is required with respect to such Items;
and, to such counsel's knowledge the description of the Company's stock option
plans and the options granted and which may be granted thereunder and the
options granted otherwise than under such plans set forth in the Registration
Statement accurately and fairly presents in all material respects the
information required to be shown with respect to said plans and options to the
extent required by the Securities Act and the rules and regulations of the
Commission thereunder;
(vi) such counsel does not know of any franchises, contracts, leases,
documents or legal proceedings, pending or threatened, which in the opinion of
such counsel are of a character required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the Registration
Statement, which are not described and filed as required;
(vii) the Underwriting Agreement has been duly authorized, executed and
delivered by the Company;
(viii) the issuance and sale by the Company of the shares of Stock sold
by the Company as contemplated by the Underwriting Agreement will not conflict
with, or result in a breach of, the Certificate of Incorporation or By-Laws of
the Company or any agreement or instrument known to such counsel to which the
Company or its subsidiary is a party or any applicable law or regulation (other
than federal or state securities or blue sky laws), or so far as is known to
such counsel, any order, writ, injunction or decree, of any jurisdiction, court
or governmental instrumentality;
(ix) all holders of securities of the Company having rights to the
registration of shares of Common Stock, or other securities, because of the
filing of the Registration Statement by the Company have waived such rights or
such rights have expired by reason of lapse of time following notification of
the Company's intent;
(xii) no consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation of the transactions
contemplated in the Underwriting Agreement, except such as have been obtained
under the Securities Act and such as may be required under state securities or
blue sky laws in connection with the purchase and distribution of the Stock by
the Underwriters; and
(xiii) the Stock issued and sold by the Company will have been duly
authorized for listing by the Nasdaq Stock Market upon official notice of
issuance.
In addition to the matters set forth above, counsel rendering the
foregoing opinion shall also include a statement to the effect that nothing has
come to the attention of such counsel that leads them to believe that the
Registration Statement (except as to the financial statements and schedules, or
notes thereto, and other financial data contained or incorporated by reference
therein, as to which such counsel need not express any opinion or belief) at the
Effective Date contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus (except as to the
financial statements and schedules, or notes thereto, and other financial data
contained or incorporated by reference therein as to which such counsel need not
express any opinion or belief) as of its date or at the Closing Date (or any
later date on which Option Stock is purchased), contained or contains any untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading.
---------------------------------------
Counsel rendering the foregoing opinion may rely as to questions of law
not involving the laws of the United States, the State of Delaware or of the
Commonwealth of Pennsylvania, upon opinions of local counsel satisfactory in
form and scope to counsel for the Underwriters. Copies of any opinions so relied
upon
22
shall be delivered to the Underwriters and to counsel for the Underwriters and
the foregoing opinion shall also state that counsel knows of no reason the
Underwriters are not entitled to rely upon the opinions of such local counsel.
