UNICOMP, INC.
1,500,000 Shares of Common Stock
UNDERWRITING AGREEMENT
_____________, 1996
CRUTTENDEN XXXX INCORPORATED
As Representative of the
Several Underwriters
named in Schedule I hereto
00000 Xxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Ladies and Gentlemen:
UniComp, Inc., a corporation organized under the laws of the State of
Colorado (the "Company"), proposes to issue and sell to the several Underwriters
named on Schedule I hereto (the "Underwriters") an aggregate of 1,500,000 shares
(the "Firm Shares") of common stock, par value $.01 per share, of the Company
(the "Common Stock"). The Company also proposes to issue to you, individually
and not in your capacity as Representative (the "Representative"), a five-year
warrant (the "Representative's Warrant") to purchase up to 150,000 shares of
Common Stock of the Company (the "Representative's Warrant Stock"). In
addition, for the sole purpose of covering over-allotments in connection with
the sale of the Firm Shares, each of the Company and the shareholders of the
Company named on Schedule II hereto (the "Selling Shareholders") propose to
grant to the Underwriters an option to purchase up to an aggregate of
225,000 shares (the "Option Shares") of Common Stock, including
75,000 additional shares to be sold by the Company and 150,000 shares to be
sold by the Selling Shareholders. The Firm Shares and any Option Shares
purchased pursuant to this Agreement are herein called the "Shares."
This is to confirm the agreement concerning the purchase of the Shares from
the Company and the Selling Shareholders by the Underwriters.
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to, and agrees with, each Underwriter
that:
(a) A registration statement on Form S-1 (File No. 333-12209) (the
"Initial Registration Statement") has been prepared by the Company in conformity
with the requirements of the Securities Act of 1933, as amended (the "Securities
Act"), and the rules and regulations of the Securities and Exchange Commission
(the "Commission") thereunder and has been filed with the Commission. Copies of
such Initial Registration Statement and any amendments, and all forms of the
related prospectuses contained therein, including a registration statement, if
any, increasing the size of the offering (a "Rule 462(b) Registration
Statement"), filed pursuant to Rule 462(b) under the Securities Act, have been
delivered to you. The Initial Registration Statement on Form S-1, including the
prospectus, Part II thereof and all exhibits thereto, as amended at the time
when they shall become effective, and the Rule 462(b) Registration Statement,
which became effective upon filing, are herein referred to as the "Registration
Statement," and the prospectus included as part of the Initial Registration
Statement on file with the Commission that discloses the information (if any)
that was omitted from the prospectus on the effective date pursuant to Rule 430A
of the Rules and Regulations (as defined below), with any changes contained in
any prospectus filed with the Commission by the Company after the effective date
of the Initial Registration Statement, is herein referred to as the "Final
Prospectus." The prospectus included as part of the Initial Registration
Statement on the date when the Initial Registration Statement was declared
effective and when the Rule 462(b) Registration Statement became effective is
referred to herein as the "Effective Prospectus"; any prospectus included in the
Initial Registration Statement and in any amendments thereto prior to the
effective date of the Initial Registration Statement is referred to herein as a
"Pre-Effective Prospectus." For purposes of this Agreement, "Rules and
Regulations" means the rules and regulations adopted by the Commission under
either the Securities Act or the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), as applicable, and "affiliate" shall have the definition
specified in Rule 405 of the Rules and Regulations.
(b) No order preventing or suspending the use of any Pre-Effective
Prospectus has been issued by the Commission and each Pre-Effective Prospectus,
at the time of the filing thereof, did 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, in the light of the circumstances
under which they were made, not misleading; except that the foregoing shall not
apply to statements in or omissions from any Pre-Effective Prospectus in
reliance upon, and in conformity with, written information furnished to the
Company by you or by any Underwriter through you, specifically for use in the
preparation thereof.
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(c) When the Registration Statement became or becomes effective and
at all times subsequent thereto, the Registration Statement, any post-effective
amendment thereto and the Effective Prospectus and the Final Prospectus as
amended or supplemented did or shall comply in all material respects with the
requirements of the Securities Act and the Rules and Regulations. No such
document did or shall contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, except that the foregoing shall not apply to
statements in, or omissions from, any such document, in reliance upon, and in
conformity with, written information furnished to the Company by you, or by any
Underwriter through you, specifically for use in the preparation thereof. There
is no contract or document required to be described in the Registration
Statement or Effective Prospectus or Final Prospectus or to be filed as an
exhibit to the Registration Statement that is not described or filed as
required.
(d) Coopers & Xxxxxxx L.L.P., whose report appears in the Effective
Prospectus and the Final Prospectus, is an independent certified public
accountant as required by the Securities Act and the Rules and Regulations. The
financial statements (including the related notes) included in the Registration
Statement, any Pre-Effective Prospectus, the Effective Prospectus and the Final
Prospectus present fairly the financial condition, the results of the operations
and changes in cash flows and equity of the entity purported to be shown thereby
at the dates and for the periods indicated and have been prepared in accordance
with generally accepted accounting principles applied on a consistent basis
throughout the periods indicated. The summary and selected financial and
statistical data included in the Registration Statement present fairly the
information shown therein on the basis stated in the Registration Statement and
have been compiled on a basis consistent with the financial statements presented
therein.
(e) The Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Colorado, with full
power and authority (corporate and other) to own or lease its properties and
conduct its business as described in the Effective Prospectus and the Final
Prospectus, and is duly qualified to do business and is in good standing in each
jurisdiction in which the character of the business conducted by it or the
location of the properties owned or leased by it makes such qualification
necessary, except where the failure to so qualify would not have a material
adverse effect on the condition (financial or otherwise) earnings, operations or
business of the Company and its subsidiaries, taken as a whole; and each
subsidiary of the Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of its jurisdiction of
incorporation. All of the issued shares of the subsidiaries of the Company have
been duly and validly authorized and issued, are fully paid and (except for one
share of
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certain of the Company's subsidiaries which are held by Xxxxxxx X. Xxxxx) owned
directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims. The Company and its subsidiaries have
obtained all material licenses, certificates, permits and authorizations from
governmental authorities necessary for the conduct of their businesses as
described in the Effective Prospectus and the Final Prospectus, such licenses,
certificates, permits and other governmental authorizations are in full force
and effect, the Company and its subsidiaries are in compliance therewith, and
the expiration of any such licenses, permits or other governmental
authorizations would not materially affect the operations of the Company or any
of its subsidiaries. Complete and correct copies of the Articles of
Incorporation and of the Bylaws of the Company and all amendments thereto have
been delivered to the Representative, and, except as disclosed in the
Registration Statement and the Effective Prospectus, no changes therein will be
made subsequent to the date hereof and prior to the date of the consummation of
the sale of the Firm Shares.
(f) The capitalization of the Company is as set forth under the
caption "Capitalization" in the Effective Prospectus and the Final Prospectus,
and the Common Stock conforms to the description thereof contained under the
caption "Description of Capital Stock" in the Effective Prospectus and the Final
Prospectus; the outstanding shares of Common Stock have been, and the Shares to
be sold by the Company on each Closing Date, upon issuance and delivery and
payment therefor in the manner herein described, will be, duly authorized,
validly issued, fully paid and nonassessable. All offers and sales by the
Company of outstanding shares of capital stock and other securities of the
Company made prior to the date hereof, were made in compliance with the
Securities Act and all applicable state securities or blue sky laws. Except as
disclosed in the Effective Prospectus and the Final Prospectus or the
Registration Statement, the Company does not own, and at the date of the
consummation of the sale of the Firm Shares will not own, directly or
indirectly, any shares of stock or any other equity or long-term debt securities
of any corporation or have any equity interest in any firm, partnership, joint
venture, association or other entity. Except as described in the Effective
Prospectus and the Final Prospectus, there are no preemptive rights or other
rights to subscribe for or to purchase, or any restriction upon the voting or
transfer of, any shares of Common Stock pursuant to the Company's Articles of
Incorporation, Bylaws or other governing documents or any agreement or other
instrument to which the Company is a party or by which it may be bound. Neither
the filing of the Initial Registration Statement or the Rule 462(b) Registration
Statement, if any, nor the offering or sale of the Shares as contemplated by
this Agreement or the Representative's Warrant gives rise to any rights, other
than those that have been waived or satisfied, for or relating to the
registration of any shares of Common Stock.
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(g) Except as described in or contemplated by the Effective
Prospectus and the Final Prospectus, there has not been any material adverse
change in, or any adverse development that materially affects, the business,
properties, financial condition, results of operations or prospects of the
Company or any of its subsidiaries from the date as of which information is
given in the Effective Prospectus and the Final Prospectus, and, except as
described in or contemplated by the Effective Prospectus and the Final
Prospectus, the Company and its subsidiaries have not, directly or indirectly,
incurred any liabilities or obligations, direct or contingent, not in the
ordinary course of business, or entered into any transactions not in the
ordinary course of business, that are material to the business of the Company or
any of its subsidiaries, and there has not been any change in the capital stock
of, or any incurrence of long-term debt by, the Company, or any issuance or
grant of options, warrants or rights to purchase the capital stock of the
Company or any of its subsidiaries, or any declaration or payment of any
dividend on the capital stock of the Company from the date as of which
information is given in the Effective Prospectus and the Final Prospectus.
(h) Neither the Company nor any of its subsidiaries is, nor with the
giving of notice or lapse of time or both would any of them be, in violation of
or in default under, nor will the execution or delivery of this Agreement or the
Representative's Warrant or the consummation of the transactions contemplated
hereby or thereby result in a violation of, or constitute a default under the
Articles of Incorporation, Bylaws or other governing documents of the Company or
any of its subsidiaries, or any obligation, agreement, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement, lease or
other agreement or instrument, to which the Company or any of its subsidiaries
is a party or by which the Company or any of its subsidiaries may be bound, or
to which the properties of the Company or any of its subsidiaries is subject,
nor will the performance by the Company of its obligations hereunder or under
the Representative's Warrant violate any law, rule, administrative regulation or
decree of any court, or any governmental agency or body having jurisdiction over
the Company or any of its subsidiaries or any of the properties of the Company
or any of its subsidiaries, or result in the creation or imposition of any lien,
charge, claim or encumbrance upon any property or asset of the Company or any of
its subsidiaries. Except for permits and similar authorizations required under
the Securities Act and the securities or "blue sky" laws of certain
jurisdictions and for such permits and authorizations that have been obtained,
no consent, approval, authorization, order, registration, filing, qualification,
license or permit of any court, regulatory, administrative or other governmental
agency or body or financial institution is required for the execution and
delivery of this Agreement or the Representative's Warrant or in connection with
the consummation of the transactions contemplated by this Agreement or the
Representative's Warrant.
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(i) The Company has the power and authority to enter into this
Agreement and to issue the Representative's Warrant and to authorize, issue and
sell the Shares it will sell hereunder as contemplated hereby and the shares of
Common Stock to be issued upon exercise of the Representative's Warrant as
contemplated by the Representative's Warrant. Each of this Agreement and the
Representative's Warrant has been duly authorized, executed and delivered by the
Company and constitutes the valid and binding agreement of the Company and is
enforceable against the Company in accordance with its terms, except as may be
limited by bankruptcy, insolvency, reorganization or other similar laws
affecting creditors' rights generally.
(j) The Representative's Warrant Stock has been duly authorized and
reserved for issuance upon the exercise of the Representative's Warrant and when
issued and paid for pursuant to the terms of the Representative's Warrant will
be validly issued, fully paid and nonassessable.
(k) The Company and its subsidiaries have good and marketable title
in fee simple to all items of real property and good and marketable title to all
personal property owned by them, in each case free and clear of all liens,
encumbrances and defects, except such as are described or referred to in the
Effective Prospectus and the Final Prospectus or such as do not materially
affect the value of such property and do not interfere with the use made or
proposed to be made of such property by the Company and its subsidiaries, and
any real property and buildings held under lease by the Company and its
subsidiaries are held by it under valid, existing and enforceable leases with
such exceptions as are not material and do not interfere with the use made or
proposed to be made of such property and buildings by the Company and its
subsidiaries.
(l) Except as described in the Effective Prospectus and the Final
Prospectus, there is no litigation or governmental proceeding to which the
Company or any of its subsidiaries is a party or to which any property of the
Company or any of its subsidiaries is subject or which is pending or, to the
knowledge of the Company, threatened against the Company that might result in
any material adverse change in the condition, financial or otherwise, results of
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operations, business affairs or business prospects of the Company and its
subsidiaries or that is required to be disclosed in the Effective Prospectus and
the Final Prospectus, nor are there any actions, suits or proceedings related to
environmental matters or related to discrimination on the basis of age, sex,
religion, race, or physical or mental disability, and no labor disturbance by
the employees of the Company or any of its subsidiaries exists or is, to the
Company's or any of its subsidiaries' knowledge, imminent that might be expected
to affect adversely the condition, financial or otherwise, results of
operations, business affairs or business prospects of the Company and its
subsidiaries or that is required to be disclosed in the Effective Prospectus.
(m) Neither the Company nor any of its subsidiaries is in violation
of any law, ordinance, governmental rule or regulation or court decree to which
they may be subject, which violation might be expected to have a material
adverse effect on the condition, financial or otherwise, results of operations,
business affairs or business prospects of the Company.
(n) The Company has not taken, and shall not take, directly or
indirectly, any action designed to cause or result in, or which has constituted
or which might reasonably be expected to constitute, the stabilization or
manipulation of the price of the Common Stock to facilitate the sale or resale
of the Shares.
(o) The Company and each of its subsidiaries have timely (giving
effect to permitted extensions) and properly prepared and filed all necessary
federal, state, local and foreign income, franchise and any other required tax
returns and have paid all taxes shown as due thereon, and the Company has no
knowledge of any tax deficiency that has been or might be asserted against the
Company or any of its subsidiaries that might materially and adversely affect
the financial condition, results of operations, business or prospects of the
Company.
(p) Neither the Company or any of its subsidiaries nor any of their
officers, directors, employees or agents acting on behalf of the Company or any
of its subsidiaries has at any time (i) made any contributions to any candidate
for political office in violation of law, or failed to disclose fully any
contributions to any candidate for political office in accordance with any
applicable statute, rule, regulation or ordinance requiring such disclosure,
(ii) made any payment to any local, state, federal or foreign governmental
officer or official or other person charged with similar public or quasi-public
duties, other than payments required or allowed by applicable law, (iii) made
any payment outside the ordinary course of business to any purchasing or selling
agent or person charged with similar duties of any entity to which the Company
or any of its subsidiaries sells or from which the Company or any of its
subsidiaries buys products for the purpose of influencing such agent or person
to buy products from or sell products to the Company or any of its subsidiaries,
or (iv) except as set forth in the Effective Prospectus and the Final
Prospectus, engaged in any transaction, maintained any bank account or used any
corporate funds except for transactions, bank accounts and funds that have been
and are reflected in the normally maintained books and records of the Company or
any of its subsidiaries.
Page 7
(q) The Company does not know of any claims for services in the
nature of a finder's fee, brokerage fee or otherwise with respect to this
offering for which the Company or any of the several Underwriters may be
responsible.
(r) The Company and its subsidiaries have all their properties
adequately insured against loss or damage by fire and maintain such other
insurance as is prudent or customarily maintained by companies in the same or
similar business and in the same or similar locality.
(s) The Company and its subsidiaries own or possess adequate rights
to use all material patents, patent rights, inventions, trademarks, service
marks, trade names and copyrights necessary for the conduct of their businesses
as described in the Effective Prospectus and the Final Prospectus and have taken
reasonable security measures to protect the secrecy, confidentiality and value
of their trade secrets and know-how that are not part of the public knowledge or
literature. Any employees of the Company or any of its subsidiaries and any
other person who, either alone or in concert with others, developed, invented,
discovered, derived, programmed or designed these secrets, or who have knowledge
of or access to information relating to them, have been put on notice and have
entered into agreements that these secrets are proprietary to the Company and
its subsidiaries and are not to be divulged or misused. The Company and its
subsidiaries have not received any notice of infringement of or conflict with,
and, to the best of the Company's knowledge, neither the Company nor any of its
subsidiaries infringes or is in conflict with, asserted rights of others with
respect to any patents, patent rights, inventions, trademarks, service marks,
trade names, copyrights or trade secrets that, singly or in the aggregate, if
the subject of an unfavorable decision, ruling or finding, could materially and
adversely affect the financial condition, results of operations, business or
prospects of the Company.
(t) There are no outstanding loans or advances or guarantees of
indebtedness by the Company or any of its subsidiaries to or for the benefit of
any affiliate of the Company or any of its subsidiaries, any of the officers or
directors of the Company or any of its subsidiaries, or any of the members of
the families of any of them, that are required by the Rules and Regulations to
be described in the Registration Statement, the Effective Prospectus and the
Final Prospectus, except such that are so described.
(u) The Company and its subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management's general or
specific authorization, (ii) transactions are recorded as necessary in order to
permit preparation of financial statements in accordance with generally accepted
accounting principles and to maintain accountability for assets, (iii) access to
assets is permitted only in accordance
Page 8
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.
(v) The Company has not distributed and will not distribute any
prospectus or other offering material in connection with the offering and sale
of the Shares other than any Pre-Effective Prospectus, Effective Prospectus or
Final Prospectus or other materials permitted by the Securities Act to be
distributed by the Company.
(w) The Company is not an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLING SHAREHOLDERS.
Each Selling Shareholder represents and warrants to, and agrees with,
each Underwriter that:
(a) Such Selling Shareholder has duly executed and delivered a Power
of Attorney (the "Power of Attorney"), appointing Xxxxxxx X. Xxxxx and L. Xxxxx
Xxxxx, and each of them, as attorney-in-fact (the "Attorneys-in-Fact") with full
power and authority to execute and deliver this Agreement on behalf of such
Selling Shareholder, to authorize the delivery of the Shares to be sold by the
Selling Shareholder hereunder and otherwise to act on behalf of such Selling
Shareholder in connection with the transactions contemplated by this Agreement.
(b) Such Selling Shareholder has duly executed and delivered a
Custody Agreement (the "Custody Agreement") with Lawco of Washington, Inc., as
Custodian, pursuant to which certificates in negotiable form for the Shares to
be sold by such Selling Shareholder hereunder have been placed in custody for
delivery under this Agreement.
(c) Such Selling Shareholder has full right, power and authority to
enter into this Agreement, the Power of Attorney and the Custody Agreement, and
to sell, assign, transfer and deliver the Shares to be sold by such Selling
Shareholder hereunder; and all consents, approvals, authorizations and orders
necessary for the execution and delivery by such Selling Shareholder of this
Agreement, the Power of Attorney and the Custody Agreement, and for the sale and
delivery of the Shares to be sold by such Selling Shareholder hereunder, have
been obtained, except such as may be required under the Securities Act or any
state securities or blue sky laws.
Page 9
(d) Such Selling Shareholder has, and at the Option Closing Date (as
defined in Section 4) will have, good and valid title to the Option Shares to be
sold by such Selling Shareholder hereunder, free and clear of all liens,
encumbrances, equities and claims; and, upon delivery of and payment for such
Option Shares pursuant to this Agreement, the Underwriters will acquire all such
Option Shares, free and clear of all liens, encumbrances, equities and claims
within the meaning of the Universal Commercial Code, as adopted in the State of
Colorado.
(e) Neither the execution or delivery of this Agreement, the Power of
Attorney and the Custody Agreement nor the consummation of the transactions
contemplated hereby and thereby by such Selling Shareholder will result in a
violation of, or constitute a default under, any agreement, indenture or other
instrument to which such Selling Shareholder is a party or may be bound, nor
will the performance by such Selling Shareholder's obligations hereunder or
thereunder violate any law, rule, administrative regulation or decree of any
court or any governmental agency or body having jurisdiction over such Selling
Shareholder. Except for permits and similar authorizations required under the
Securities Act and the securities or "blue sky" laws of certain jurisdictions
and for such permits and authorizations which have been obtained, no consent,
approval, authorization or order of any court, governmental agency or body or
financial institution is required in connection with the consummation of the
transactions contemplated by this Agreement by such Selling Shareholder.
(f) Such Selling Shareholder has not taken, and shall not take,
directly or indirectly, any action designed to cause or result in, or which has
constituted or which might reasonably be expected to constitute, the
stabilization or manipulation of the price of the Common Stock to facilitate the
sale or resale of the Shares.
(g) Such Selling Shareholder does not know of any claims for services
in the nature of a finder's fee, brokerage fee or otherwise with respect to this
offering for which such Selling Shareholder or any of the several Underwriters
may be responsible.
(h) To the extent that any statements or omissions made in the
Registration Statement, any Pre-Effective Prospectus, the Effective Prospectus,
the Final Prospectus or any amendment or supplement thereto are made in reliance
upon and in conformity with written information with respect to such Selling
Shareholder furnished to the Company by such Selling Shareholder expressly for
use therein, such Pre-Effective Prospectus and the Registration Statement did
not, and the Effective Prospectus, Final Prospectus and any further amendments
or supplements to the Registration Statement and the Final Prospectus will not,
when they are filed with the
Page 10
Commission contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading.
(i) Except as otherwise set forth in such Selling Shareholder's
Lock-Up Agreement entered into pursuant to Section 5(k), such Selling
Shareholder will not offer to sell, transfer, assign or otherwise dispose of,
directly or indirectly, shares of Common Stock or other equity securities of the
Company now owned or hereafter acquired for a period of one year after the date
of the Final Prospectus, otherwise than hereunder or with the written consent of
the Representative, and, during such one-year period, no such offer, transfer,
assignment or other disposition of any Common Stock will be made by such Selling
Shareholder pursuant to Rule 144 of the Rules and Regulations unless such
Selling Shareholder shall have first offered the Representative in writing the
opportunity to effect any such transaction and the Representative shall not have
notified the Selling Shareholder thereof within five business days of the
Representative's receipt of such notice of its desire to attempt to effect such
transaction on behalf of the Selling Shareholder.
(j) Such Selling Shareholder does not have knowledge that the
Registration Statement, any Pre-Effective Prospectus, the Effective
Prospectus or the Final Prospectus (or any amendment or supplement thereto)
contains any untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading.
(k) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Internal Revenue Code of 1986, as
amended, with respect to the transactions herein contemplated, each of the
Selling Shareholders agrees to deliver to you prior to or at the Option Closing
Date a properly completed and executed United States Treasury Department
Form W-9 (or other applicable form or statement specified by Treasury Department
regulations in lieu thereof).
(l) Each of the Selling Shareholders specifically agrees that the
Shares represented by the certificates held in custody for such Selling
Shareholder under the Custody Agreement are subject to the interests of the
Underwriters hereunder, and that the arrangements made by such Selling
Shareholder for such custody and the appointment by such Selling Shareholder of
the Attorneys-in-Fact by the Power of Attorney are to that extent irrevocable.
Each of the Selling Shareholders specifically agrees that the obligations of the
Selling Shareholders hereunder shall not be terminated by operation of law,
whether by the death or incapacity of any
Page 11
individual Selling Shareholder, or, in the case of an estate or trust, by the
death or incapacity of any executor or trustee or the termination of such estate
or trust, or in the case of a corporation or partnership, by the dissolution of
such corporation or partnership, or by the occurrence of any other event. If
any individual Selling Shareholder or any such executor or trustee should die or
become incapacitated, or if any such estate or trust should be terminated, or if
any such corporation or partnership should be dissolved, or if any other such
event should occur before the delivery of the Shares hereunder, certificates
representing the Shares shall be delivered by or on behalf of the Selling
Shareholders in accordance with the terms and conditions of this Agreement and
of the Custody Agreement, and actions taken by the Attorneys-in-Fact pursuant to
the Power of Attorney shall be as valid as if such death, incapacity,
termination, dissolution or other event had not occurred, regardless of whether
or not the Custodian or the Attorneys-in-Fact, or any of them, shall have
received notice of such death, incapacity, termination, dissolution or other
event.
3. PURCHASE OF THE SHARES BY THE UNDERWRITERS.
(a) Subject to the terms and conditions and upon the basis of the
representations and warranties herein set forth, the Company agrees to sell to
each Underwriter, and each Underwriter agrees to purchase from the Company at a
price of $_____ per share, the number of Firm Shares determined by multiplying
the aggregate number of Firm Shares set forth opposite such Underwriter's name
in Schedule I hereto. The Underwriters agree to offer the Firm Shares to the
public as set forth in the Final Prospectus.
(b) In addition, subject to the terms and conditions and upon the
basis of the representations and warranties herein set forth, the Company and
each of the Selling Shareholders, as and to the extent indicated on Schedule II
hereto, hereby grant, severally and not jointly, to the several Underwriters an
option to purchase at their election the Option Shares at the same price per
share as set forth for the Firm Shares in the paragraph above, for the sole
purpose of covering over-allotments in the sale of the Firm Shares. The option
granted hereby may be exercised in whole or in part, but only once, and at any
time upon written notice given within 45 days after the date of this Agreement,
by you, as Representative of the several Underwriters, to the Company, the
Attorneys-in-Fact and the Custodian setting forth the number of Option Shares as
to which the several Underwriters are exercising the option and the time and
date at which certificates are to be delivered. Any such election to purchase
Option Shares shall be made in proportion to the maximum number of Option Shares
to be sold by the Company and each Selling Shareholder as set forth on
Schedule II hereto; PROVIDED, HOWEVER, that if you, on behalf of the
Underwriters, elect to exercise the option with respect to less than all the
Option Shares, the Underwriters shall purchase
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the Option Shares being sold by the Selling Shareholders (in proportion to the
maximum number of Option Shares to be sold by each Selling Shareholder) prior to
the purchase of any Option Shares being sold by the Company. If any Option
Shares are purchased, each Underwriter agrees, severally and not jointly, to
purchase that portion of the number of Option Shares as to which such election
shall have been exercised (subject to adjustment to eliminate fractional shares)
determined by multiplying such number of Option Shares by a fraction the
numerator of which is the maximum number of Option Shares that such Underwriter
is entitled to purchase as set forth opposite the name of such Underwriter on
Schedule I hereto and the denominator of which is the maximum number of Option
Shares that all the Underwriters are entitled to purchase hereunder. The time
and date at which certificates for Option Shares are to be delivered shall be
determined by the Representative but shall not be earlier than two or later than
ten full Business Days (as defined in Section 14 hereof) after the exercise of
such option, and shall not in any event be prior to the First Closing Date (as
defined in Section 4 hereof). If the date of exercise of the option is three or
more full days before the First Closing Date, the notice of exercise shall set
the First Closing Date as the Option Closing Date.
(c) On the First Closing Date, the Company will issue and sell to the
Representative or its designees, consistent with all applicable state and
federal securities laws and regulations and all applicable regulations of the
National Association of Securities Dealers, Inc. (the "NASD"), one or more
warrants for the purchase of an aggregate of 150,000 shares of Common Stock.
Such warrants shall have a per share exercise price equal to 165% of the initial
public offering price per share, shall be exercisable over a four-year period
commencing one year from the date of the Final Prospectus and shall be in
substantially the form attached hereto as Exhibit A . Such warrants shall be
dated, executed and delivered as of the First Closing Date.
4. DELIVERY OF AND PAYMENT FOR SHARES.
Delivery of certificates for the Shares to be purchased by the Underwriters
hereunder shall be made against payment therefor by, at your election, certified
or official bank check or checks drawn upon or by a New York Clearing House bank
or by wire transfer, in either case payable in same-day funds to the order of
the Company. Such delivery and payment with respect to the Firm Shares shall be
made at 7:00 A.M., Pacific standard time, at the offices of Xxxxxxx Coie,
0000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxx, XX 00000 (or such other place as
mutually may be agreed upon), on the third full Business Day or at such other
date as shall be determined by you and the Company (the "First Closing Date").
With respect to Option Shares, such delivery and payment shall be made at the
time and on the date
Page 13
specified by you in the written notice given by you of the Underwriters'
election to purchase the Option Shares, or such other time and date as you and
the Company may agree upon in writing, such time and date being referred to
herein as the "Option Closing Date." Such certificates will be made available
for checking and packaging at least 24 hours prior to the First Closing Date or
the Option Closing Date, as the case may be, at a location as may be designated
by you. Time shall be of the essence, and delivery at the time and place
specified in this Agreement is a further condition to the obligations of each
Underwriter. The First Closing Date and the Option Closing Date are herein
individually referred to as the "Closing Date" and collectively referred to as
the "Closing Dates."
5. COVENANTS.
The Company covenants and agrees with each Underwriter that:
(a) The Company shall use its best efforts to cause the Registration
Statement to become effective or, if the procedure in Rule 430A of the Rules and
Regulations is utilized, to comply with the provisions of, and make all
requisite filings with the Commission pursuant to, Rule 430A of the Rules and
Regulations and to notify you promptly (in writing, if requested) of all such
filings. The Company shall notify you promptly of any request by the Commission
for any amendment of or supplement to the Registration Statement or the
Effective Prospectus or the Final Prospectus or for additional information; the
Company shall prepare and file with the Commission, promptly upon your request,
any amendments of or supplements to the Registration Statement or the Effective
Prospectus or the Final Prospectus that, in your opinion, may be necessary or
advisable in connection with the distribution of the Shares; and the Company
shall not file any amendment of or supplement to the Registration Statement or
the Effective Prospectus or the Final Prospectus that is not approved by you
after reasonable notice thereof, such approval not to be unreasonably withheld
or delayed. The Company shall advise you promptly of the issuance by the
Commission or any state or other regulatory body of any stop order or other
order suspending the effectiveness of the Registration Statement, suspending or
preventing the use of any Pre-Effective Prospectus or the Effective Prospectus
or Final Prospectus or suspending the qualification of the Shares for offering
or sale in any jurisdiction, or of the institution of any proceedings for any
such purpose; and the Company shall use its best efforts to prevent the issuance
of any stop order or other such order and, should a stop order or other such
order be issued, to obtain as soon as possible the lifting thereof.
(b) The Company shall furnish to the Underwriters, from time to time
and without charge, a reasonable number of copies of the Registration Statement
of which one for the Representative and one for counsel to the Underwriters
shall be
Page 14
signed and shall include exhibits and all amendments and supplements to such
Registration Statement.
(c) The Company will furnish the Underwriters with as many copies of
any Pre-Effective Prospectus as the Representative may reasonably request, and,
during the period when delivery of a prospectus is required under the Securities
Act, the Company will furnish the Underwriters with as many copies of the Final
Prospectus as the Representative may, from time to time, reasonably request. If
during such period any event occurs as a result of which the Final Prospectus as
then amended or supplemented would include an untrue statement of a material
fact or omit to state a material fact necessary to make the statements therein,
in light of the circumstances then existing, not misleading, or, if during such
period it is necessary to amend the Registration Statement or supplement the
Final Prospectus to comply with the Securities Act, the Company shall promptly
notify you and shall amend the Registration Statement or supplement the Final
Prospectus (at the expense of the Company) so as to correct such statement or
omission or effect such compliance.
(d) The Company shall take or cause to be taken all necessary action
and furnish to whomever you may direct such information as may be required in
qualifying the Shares for sale under the laws of such jurisdictions that you
shall designate and to continue such qualifications in effect for as long as may
be necessary for the distribution of the Shares; except that in no event shall
the Company be obligated in connection therewith to qualify as a foreign
corporation, or to execute a general consent for service of process. 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 the Representative may reasonably request for
distribution of the Shares.
(e) The Company shall make generally available to its security
holders, in the manner contemplated by Rule 158(b) under the Securities Act, as
soon as practicable but in any event not later than 45 days after the end of its
fiscal quarter in which the first anniversary date of the effective date of the
Registration Statement occurs, an earnings statement satisfying the requirements
of Section 11(a) of the Securities Act covering a period of at least 12
consecutive months beginning after the effective date of the Registration
Statement and will advise you in writing when such statement has been so made
available.
(f) For a period of one year following the First Closing Date, the
Company will not, without your prior written consent, (i) purchase any shares of
Common Stock or equity securities of the Company or (ii) offer, issue, sell,
transfer or otherwise dispose of, for value or otherwise, directly or
indirectly, any shares of Common Stock or other equity securities of the
Company, except (A) the Shares and
Page 15
the Representative's Warrant, (B) pursuant to the exercise of options or
warrants of the Company outstanding immediately prior to the First Closing Date,
as described in the Effective Prospectus and the Final Prospectus, (C) up to
235,000 shares of Common Stock issued upon the grant of options pursuant to the
Company's existing employee benefit plans, as described in the Effective
Prospectus and the Final Prospectus, (D) up to 150,000 shares of Common Stock
issued upon the grant of options pursuant to the Company's 1996 Director
Incentive Plan, (E) issuances and sales in transactions not involving a public
offering, or (F) in connection with a merger of another corporation into, or an
acquisition of all or substantially all of the assets or stock of another entity
by, the Company where the Company or a subsidiary is the surviving entity.
(g) The Company shall apply the net proceeds of the sale of the
Shares as set forth under the caption "Use of Proceeds" in the Final Prospectus.
(h) The Company shall pay or cause to be paid (A) all expenses
(including stock transfer taxes) incurred in connection with the delivery to the
several Underwriters of the Shares, (B) all fees and expenses (including,
without limitation, fees and expenses of the Company's accountants and counsel)
in connection with the preparation, printing, filing, delivery and shipping of
the Registration Statement (including the financial statements therein and all
amendments and exhibits thereto), each Pre-Effective Prospectus, the Effective
Prospectus and the Final Prospectus as amended or supplemented and the printing,
delivery and shipping of this Agreement and other underwriting documents,
including Underwriters' Questionnaires, Underwriters' Powers of Attorney, Blue
Sky Memoranda, Agreements Among Underwriters and Selected Dealer Agreements and
any letters transmitting the offering material to Underwriters or selling group
members (including costs of mailing and shipment), (C) all filing fees and
reasonable fees and disbursements of counsel to the Underwriters incurred in
connection with the qualification of the Shares under state securities laws as
provided in Section 5(d) hereof, (D) the filing fee of the NASD, (E) any
applicable listing fees, including the fee for listing the Shares on the Nasdaq
National Market, (F) the cost of printing certificates representing the Shares,
(G) the cost and charges of any transfer agent or registrar, (H) the costs of
preparing, printing and distributing bound volumes for the Representative and
its counsel, and (I) all other costs and expenses incident to the performance of
its obligations hereunder that are not otherwise provided for in this section
(collectively, the amounts described in clauses (A) through (I), inclusive,
being the "Company Expenses"). In addition, the Company will also pay to you,
individually and not in your capacity as Representative, a nonaccountable
expense allowance equal to 2% of the initial public offering price of the Shares
(including Option Shares). If the sale of the Shares provided for herein is not
consummated by reason of acts of the Company pursuant to
Page 16
Section 9(a) hereof which prevent this Agreement from becoming effective, or by
reason of any failure, refusal or inability on the part of the Company to
perform any agreement on its part to be performed, or because any other
condition of the Underwriters' obligations hereunder is not fulfilled, the
Company shall (i) pay the several Underwriters for all reasonable out-of-pocket
expenses (including fees and disbursements of counsel) incurred by the
Underwriters in connection with the investigation, preparation to market and
marketing of the Shares or in contemplation of performing their obligations
hereunder, (ii) pay all blue sky filing fees and expenses, including reasonable
blue sky legal fees, and (iii) pay all expenses incurred by the Company,
including printing expenses and accounting and legal fees. If this Agreement is
terminated for any of the events specified in clauses (iii) through (v),
inclusive, of Section 9(b), or if the sale of the Shares provided for herein is
not consummated for any reason other than a reason described in the immediately
preceding sentence, the Company shall pay (or reimburse to the several
Underwriters) the Company Expenses. You acknowledge that $20,000 has already
been paid to you by the Company to be applied against such nonaccountable
expense allowance or such expenses if the sale of Shares is not consummated as
provided in the preceding sentences, as the case may be. You agree that any
portion of such $20,000 that is not necessary to pay the Underwriters for their
reasonable out-of-pocket expenses actually incurred if the sale of Shares is not
consummated for any reason shall be returned to the Company. You also
acknowledge that [$__________] has already been paid to you by the Company to be
applied against expenses incurred and submitted to the Company for reimbursement
in a written statement. Such $__________ in accountable expenses shall also be
applied against such nonaccountable expense allowance or such expenses payable
to you if the sale of Shares is not consummated as provided in the preceding
sentences, as the case may be. The Company shall not in any event be liable to
any of the Underwriters for loss of anticipated profits or other consequential
damages or otherwise (except solely as described in Section 7 hereof) from the
transactions covered by this Agreement.
(i) The Company, at its expense, will furnish to its shareholders an
annual report (including financial statements prepared in accordance with
generally accepted accounting principles audited by independent certified public
accountants), and, as soon as practicable after the end of each of the first
three quarters of each fiscal year, a statement of operations of the Company for
such quarter (which may be in summary form), all in reasonable detail, and,
during the five-year period after the date hereof, at its expense, will furnish
you, with copies for each of the several Underwriters, (i) as soon as
practicable after the end of each fiscal year, a balance sheet of the Company
and any subsidiaries as at the end of such fiscal year, together with statements
of income or operations, shareholders' equity and changes in financial position
of the Company and any consolidated subsidiaries, and of any
Page 17
nonconsolidated significant subsidiary, for such fiscal year, all in reasonable
detail and accompanied by a copy of the certificate or report thereon of
independent certified public accountants; (ii) as soon as they are available, a
copy of all reports (financial or other) mailed to security holders; (iii) as
soon as they are available, a copy of all periodic reports and financial
statements furnished to or filed with the Commission; and (iv) such other
information as you may from time to time reasonably request. In addition,
during such five-year period, upon your request the Company will furnish you
with copies for each of the several Underwriters, every material press release
and every material news item or article in respect of the Company or its affairs
that is released or prepared by the Company.
(j) If and so long as the Company has any subsidiaries, the financial
statements provided for in this Section 5(j) will be on a consolidated basis to
the extent the accounts of the Company and such subsidiaries are consolidated in
reports furnished to its shareholders generally. Separate financial statements
shall be furnished for any subsidiaries whose accounts are not consolidated, but
which at the time are significant subsidiaries as defined in the Rules and
Regulations.
(k) At or before the First Closing Date, you shall receive from each
of the Company's current officers and directors, certain warrant holders of the
Company and the Selling Shareholders, a written agreement (the "Lock-up
Agreement") not to offer, sell, transfer, assign or otherwise dispose of,
directly or indirectly, any shares of Common Stock or other equity securities of
the Company (except the sale of the Option Shares as contemplated hereby, shares
currently registered on outstanding S-3 Registration Statements, and, in the
case of certain Selling Shareholders, currently obligated to be registered on an
S-3 Registration Statement in April 1997) now owned or hereafter acquired by
such person for a period of one year from the date of the Final Prospectus,
without first (i) obtaining your prior written consent and (ii) granting you the
right, if you so elect, to act as the sole broker/dealer with respect to any
such offer, sale, transfer or other disposition of such securities pursuant to
Rule 144 of the Rules and Regulations.
(l) The Company shall continue to maintain a system of internal
accounting controls sufficient to provide reasonable assurances that
(i) transactions are executed in accordance with management's general or
specific authorization; (ii) transactions are recorded as necessary in order to
permit preparation of financial statements in accordance 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.
Page 18
(m) The Company shall comply with all registration, filing and
reporting requirements of the Exchange Act that may from time to time be
applicable to the Company.
(n) The Company shall make all filings required to maintain the
designation of the Common Stock on the Nasdaq National Market system.
(o) Prior to the First Closing Date, without the Representative's
approval, the Company shall not publish or otherwise disseminate any news
release, advertisement or comparable announcement relating to the Shares or the
offering of the Shares contemplated hereby.
(p) If any time during the 25-day period after the Registration
Statement becomes effective, any rumor, publication or event relating to or
affecting the Company shall occur as a result of which in your opinion the
market price of the Common Stock has been or is likely to be materially affected
(regardless of whether such rumor, publication or event necessitates a
supplement to or amendment of the Prospectus), the Company will, after written
notice from you advising the Company to the effect set forth above, forthwith
prepare, consult with you concerning the substance of and, if deemed appropriate
by the Company and its counsel in consultation with you and your counsel,
disseminate a press release or other public statement reasonably satisfactory to
you responding to or commenting on such rumor, publication or event.
(q) During the one-year period following the First Closing Date, the
Company shall give notice to the Representative of meetings of the Company's
Board of Directors and, if requested by the Representative, shall permit a
designee of the Representative to attend such meetings as an observer. Such
notice to the Representative shall be made in the same manner and at the same
time as notice of such meeting given to the directors of the Company.
6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of the
several Underwriters hereunder are subject to the accuracy, as of the date
hereof and each Closing Date (as if made at such Closing Date), of the
representations and warranties of the Company and the Selling Shareholders
contained herein, to the performance by the Company and the Selling Shareholders
of their obligations hereunder and to the following additional conditions:
(a) The Registration Statement and all post-effective amendments
thereto shall have become effective and all filings required by Rule 424,
Rule 430A and Rule 462(b) of the Rules and Regulations shall have been made
within the applicable time period prescribed for such filing; no stop order
suspending the
Page 19
effectiveness of the Registration Statement or any amendment or supplement
thereto shall have been issued; no proceedings for the issuance of such an order
shall have been initiated or threatened and any request of the Commission for
additional information (to be included in the Registration Statement or the
Final Prospectus or otherwise) shall have been disclosed to you and complied
with to your reasonable satisfaction.
(b) No Underwriter shall have advised the Company that the
Registration Statement or the Effective Prospectus or the Final Prospectus, or
any amendment or supplement thereto, contains an untrue statement of fact that,
in your opinion, is material and is required to be stated therein or is
necessary to make the statements therein not misleading.
(c) On or prior to each Closing Date, you shall have received from
Xxxxxxx Coie, counsel for the Underwriters, such opinion or opinions with
respect to the sufficiency of all corporate proceedings and other legal matters
relating to this Agreement and the transactions contemplated hereby as you
reasonably may require and such counsel shall have received such papers and
information as they request to enable them to pass upon such matters.
(d) On each Closing Date, there shall have been furnished to you the
opinion (addressed to the Underwriters) of Xxxxx & Xxxxxx, counsel for the
Company and the Selling Shareholders, dated such Closing Date and in form as set
forth as Exhibit B hereto and substance satisfactory to counsel for the
Underwriters.
In rendering such opinion, such counsel may rely upon opinions of local
counsel and upon certificates of any officer of the Company, the Selling
Shareholders or government officials as to matters of fact of which the maker of
such certificate has knowledge; PROVIDED, HOWEVER, that counsel rendering such
opinion shall furnish the Representative with copies of any such statements or
certificates and state in their opinion that they have no reason not to rely
upon any such statements or certificates.
(e) On each Closing Date, there shall have been furnished to you the
opinion (addressed to the Underwriters) of Xxxxxxxx Xxxxx, counsel for the
Company, dated such Closing Date and in form as set forth as Exhibit C hereto
and substance satisfactory to counsel for the Underwriters.
In rendering such opinion, such counsel may rely upon opinions of local
counsel and upon certificates of any officer of the Company, the Selling
Shareholders or government officials as to matters of fact of which the maker of
such certificate has knowledge; PROVIDED, HOWEVER, that counsel rendering such
opinion shall furnish the
Page 20
Representative with copies of any such statements or certificates and state in
their opinion that they have no reason not to rely upon any such statements or
certificates.
(f) There shall have been furnished to you a certificate, dated such
Closing Date and addressed to you, signed by the President and by the Chief
Financial Officer of the Company to the effect that: (i) the representations
and warranties of the Company in this Agreement are true and correct, as if made
at and as of such Closing Date, and the Company has complied with all the
agreements and satisfied all the conditions on its part to be performed or
satisfied at or prior to such Closing Date; (ii) no stop order suspending the
effectiveness of the Registration Statement has been issued, and no proceedings
for that purpose have been initiated or threatened; (iii) all filings required
by Rule 424, Rule 430A and Rule 462(b) of the Rules and Regulations have been
made; (iv) the signers of said certificate have carefully examined the
Registration Statement and the Effective Prospectus and the Final Prospectus,
and any amendments or supplements thereto, and such documents contain all
statements and information required to be included therein, and do not include
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading; and (v) since the effective date of the Registration Statement,
there has occurred no event required to be set forth in an amendment or
supplement to the Registration Statement or the Effective Prospectus and the
Final Prospectus that has not been so set forth.
(g) Each Selling Shareholder shall have furnished to you a
certificate, dated such Closing Date and addressed to you, to the effect that
the representations and warranties of such Selling Shareholder in this Agreement
are true and correct, as if made at and as of such Closing Date, and that such
Selling Shareholder has satisfied all the conditions on its part to be performed
or satisfied at or prior to such Closing Date.
(h) Since the effective date of the Initial Registration Statement,
the Company shall not have sustained any loss by fire, flood, accident or other
calamity, nor shall it have become a party to or the subject of any litigation,
which is material to the Company, nor shall there have been a material adverse
change in the general affairs, business, key personnel, capital, financial
position or net worth of the Company, whether or not arising in the ordinary
course of business, which loss, litigation or change is so material to the
Company that, in your judgment, it shall render it inadvisable to proceed with
the delivery of the Shares.
(i) On the date of this Agreement and on each Closing Date you shall
have received a letter of Coopers & Xxxxxxx L.L.P., dated the date hereof and
such Closing Date, respectively, addressed to you as Representative, to the
effect that
Page 21
(i) They are independent certified public accountants with
respect to the Company within the meaning of the Securities Act and the
applicable Rules and Regulations and the answer to Item 10 of the Registration
Statement is correct insofar as it relates to them (or no response is required).
(ii) In their opinion, the audited financial statements and notes
thereto of the Company reported on by them and contained in the Effective
Prospectus and the Final Prospectus comply as to form in all material respects
with the applicable accounting requirements of the Securities Act and the Rules
and Regulations.
(iii) On the basis of (a) a reading of the latest unaudited
financial statements made available by the Company, (b) carrying out certain
specified procedures (but not an examination in accordance with generally
accepted auditing standards), (c) a reading of the minutes of the meetings of
the shareholders, directors and committees of the Company, and (d) inquiries of
certain officials of the Company who have responsibility for financial and
accounting matters of the Company as to transactions and events subsequent to
February 29, 1996, nothing came to their attention that caused them to believe
that
(A) any unaudited financial statements contained in the
Effective Prospectus and the Final Prospectus (x) do not comply as to form in
all material respects with the applicable accounting requirements of the
Securities Act and the Rules and Regulations or (y) are not in conformity with
generally accepted accounting principles applied on a basis substantially
consistent with that of the audited financial statements;
(B) the financial data included in the Effective Prospectus
and the Final Prospectus under the captions "Prospectus Summary" do not agree
with the corresponding amounts in the audited and unaudited financial statements
for and as at the end of each of the periods then ended; and
(C) at a specified date not more than five Business Days
prior to the date of such letter, (a) there was any change in the capital stock
or long-term debt of the Company or any decrease in net current assets or net
assets or shareholders' equity, in each case as compared with corresponding
amounts shown in the February 29, 1996 balance sheet contained in the Effective
Prospectus and Final Prospectus, or (b) for the period from February 29, 1996 to
the specified date referred to above, as compared with the corresponding period
in the prior year, there was any decrease in sales or in net income or net
income per share, except in all instances for changes, decreases or increases
that the Effective Prospectus and the Final Prospectus disclose have occurred or
may occur, or if there was any change, decrease or increase, setting forth the
amount of such change or decrease.
Page 22
(iv) They have compared the information expressed in amounts,
dollar amounts and percentages derived therefrom and other financial information
pertaining to the Company set forth in the Effective Prospectus and the Final
Prospectus specified by you, in each case to the extent such information was
obtained or derived from the general accounting records of the Company with the
results obtained from the application of specified readings, inquiries and other
appropriate procedures (which procedures do not constitute an examination in
accordance with generally accepted auditing standards) set forth in such
letters, and found them to be in agreement.
(j) At or prior to the First Closing Date the Representative's
Warrant shall have been issued and sold to you pursuant thereto.
(k) At or prior to the First Closing Date, you shall have received
the Lock-up Agreements described in Section 5(k) hereof.
(l) You shall have been furnished such additional documents and
certificates as you may reasonably request.
All such opinions, certificates, letters and documents shall be in
compliance with the provisions hereof only if they are reasonably satisfactory
in form and substance to you and to counsel for the Underwriters. The Company
or, as applicable, the Selling Shareholders shall furnish you with such
conformed copies of such opinions, certificates, letters and other documents as
you shall reasonably request. If any of the conditions specified in Section 5
shall not have been fulfilled when and as required by this Agreement, this
Agreement and all obligations of the Underwriters hereunder may be canceled at,
or at any time prior to, each Closing Date, by you. Any such cancellation shall
be without liability of the Underwriters to the Company. Notice of such
cancellation shall be given to the Company in writing, or by telegraph or
telephone and confirmed in writing.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company shall indemnify and hold harmless each Underwriter,
each officer and director thereof, and each person, if any, who controls any
Underwriter within the meaning of the Securities Act, against any loss, claim,
damage or liability, joint or several, to which such Underwriter or such persons
may become subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage or liability (or action in respect thereof) arises out of or is
based upon (i) any untrue statement or alleged untrue statement made by the
Company in Section 1 hereof or (ii) any untrue statement or alleged untrue
statement of a material fact contained (A) in the Registration Statement, any
Pre-Effective Prospectus, the
Page 23
Effective Prospectus or the Final Prospectus or any amendment or supplement
thereto, or (B) in any blue sky application or other document executed by the
Company specifically for that purpose or based upon written information
furnished for that purpose or based upon written information furnished by the
Company filed in any state or other jurisdiction in order to qualify any or all
of the Shares under the securities laws thereof (any such application, document
or information being hereinafter called a "Blue Sky Application"), or (iii) the
omission or alleged omission to state in the Registration Statement, any Pre-
Effective Prospectus, the Effective Prospectus or the Final Prospectus or any
amendment or supplement thereto or in any Blue Sky Application a material fact
required to be stated therein or necessary to make the statements therein not
misleading; and shall pay each Underwriter or such person for any reasonable
legal or other reasonable expenses as and when incurred by such Underwriter or
such person in connection with investigating or defending against or appearing
as a third-party witness in connection with any such loss, claim, damage,
liability or action, notwithstanding the possibility that payments for such
expenses might later be held to be improper, in which case the person receiving
them shall promptly refund them; except that the Company shall not be liable in
any such case to the extent, but only to the extent, that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in reliance upon
and in conformity with written information furnished to the Company through you
by or on behalf of any Underwriter specifically for use in the preparation of
the Registration Statement, any Pre-Effective Prospectus, the Effective
Prospectus or the Final Prospectus or any amendment or supplement thereto, or
any Blue Sky Application, nor shall the Company be liable to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission in any
Pre-Effective Prospectus that is corrected in the Final Prospectus if the person
asserting any such loss, claim, damage or liability purchased shares but was not
sent or given a copy of the Final Prospectus at or prior to the written
confirmation of the sale of such shares to such person. In addition to its
other obligations under this Section 7(a), the Company agrees that, as an
interim measure during the pendency of any claim, action, investigation, inquiry
or other proceeding arising out of or based upon any statement or omission, or
any alleged statement or omission, or any inaccuracy in the representations and
warranties of the Company herein or the failure to perform its obligations
hereunder, it will pay each Underwriter or such person on a monthly basis for
all reasonable legal or other expenses incurred in connection with investigating
or defending any such claim, action, investigation, inquiry or other proceeding,
notwithstanding the absence of a judicial determination as to the propriety and
enforceability of the Company's obligation to indemnify hereunder or to pay each
Underwriter or such person for such expenses and the possibility that such
payments might later be held to have been improper by a court of competent
jurisdiction. To the
Page 24
extent that any such interim payment is so held to have been improper, each
Underwriter or such person shall promptly return it to the Company, together
with interest compounded daily, determined on the basis of the prime rate (or
other commercial lending rate for borrowers of the highest credit standing)
announced from time to time by Bank of America NT&SA, San Francisco, California
(the "Prime Rate"). Any such interim payment that is not made to an Underwriter
or such person within 30 days of a request for payment shall bear interest at
the Prime Rate from the date of such request.
(b) Each of the Selling Shareholders, severally in proportion to the
number of Option Shares sold by such Selling Shareholder hereunder to the total
number of Shares sold hereunder, shall (i) indemnify and hold harmless each
Underwriter, each officer and director thereof and each person, if any, who
controls any Underwriter within the meaning of the Securities Act, against any
loss, claim, damage or liability, joint or several, to which such Underwriter or
such persons may become subject, under the Securities Act or otherwise, insofar
as such loss, claim, damage or liability (or action in respect thereof) arises
out of or is based upon any untrue statement or alleged untrue statement made by
such Selling Shareholder in Section 2 hereof and (ii) pay each Underwriter or
such person for any reasonable legal or other reasonable expenses as and when
incurred by such Underwriter or such person in connection with investigating or
defending or appearing as a third-party witness in connection with any such
loss, claim, damage, liability or action, notwithstanding the possibility that
payments for such expenses might later be held to be improper, in which case the
person receiving them shall promptly refund them; except that the Selling
Shareholders shall not be liable in any such case to the extent, but only to the
extent, that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in reliance upon and in conformity with written information
furnished to the Company through you by or on behalf of any Underwriter
specifically for use in the preparation of the Registration Statement, any
Pre-Effective Prospectus, the Effective Prospectus or the Final Prospectus or
any amendment or supplement thereto, nor shall the Selling Shareholders be
liable to the extent that any such loss, claim, damage or liability arises out
of or is based upon an untrue statement or alleged untrue statement or omission
or alleged omission in any Pre-Effective Prospectus that is corrected in the
Final Prospectus if the person asserting any such loss, claim, damage or
liability purchased Shares but was not sent or given a copy of the Final
Prospectus at or prior to the written confirmation of the sale of such Shares to
such person. In addition to its other obligations under this Section 7(b), each
Selling Shareholder, severally in proportion to the number of Option Shares sold
by such Selling Shareholder hereunder to the total number of Shares sold
hereunder, agrees that, as an interim measure during the pendency of any claim,
action, investigation, inquiry or
Page 25
other proceeding arising out of or based upon any inaccuracy in the
representations and warranties of such Selling Shareholder herein, it will
pay each Underwriter on a monthly basis for all reasonable legal or other
expenses incurred in connection with investigating or defending any such
claim, action, investigation, inquiry, or other proceeding, notwithstanding
the absence of a judicial determination as to the propriety and
enforceability of the Selling Shareholder's obligation to indemnify hereunder
or to pay each Underwriter for such expenses and the possibility that such
payments might later be held to have been improper by a court of competent
jurisdiction. To the extent that any such interim payment is so held to have
been improper, each Underwriter shall promptly return it to the Selling
Shareholders, together with interest compounded daily, determined on the
basis of the Prime Rate. Any such interim payment that is not made to an
Underwriter within 30 days of a request for payment shall bear interest at
the Prime Rate from the date of such request. Notwithstanding the foregoing,
in no event shall any Selling Shareholder be liable hereunder for an amount
in excess of the lesser of (i) the proceeds received by such Selling
Shareholder from the Underwriters hereunder or (ii) an amount equal to (a)
the total of such losses, claims, damages, liabilities and expenses
indemnified or contributed against multiplied by (b) a fraction, the
numerator of which is the number of Option Shares sold by such Selling
Shareholder hereunder and the denominator of which is the total number of
Shares sold hereunder.
(c) Each Underwriter severally, but not jointly, shall indemnify and
hold harmless the Company, each of its directors, officers who have signed the
Registration Statement, each Selling Shareholder and each person, if any, who
controls the Company or any Selling Shareholder within the meaning of the Act
against any loss, claim, damage or liability to which the Company, any Selling
Shareholder or such person may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage or liability or action in respect
thereof arises out of or is based upon (i) any untrue statement or alleged
untrue statement of a material fact contained (A) in the Registration Statement,
any Pre-Effective Prospectus, the Effective Prospectus or the Final Prospectus
or any amendment or supplement thereto, or (B) in any Blue Sky Application, or
(ii) the omission or alleged omission to state in the Registration Statement,
any Pre-Effective Prospectus, the Effective Prospectus or the Final Prospectus
or any amendment or supplement thereto or in any Blue Sky Application a material
fact required to be stated therein or necessary to make the statements therein
not misleading; except that such indemnification shall be available in each such
case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information furnished to the Company through
you by or on behalf of such Underwriter specifically for use in the preparation
thereof, and shall pay the Company, such
Page 26
Selling Shareholder or such person for any reasonable legal or other reasonable
expenses as and when incurred in connection with investigating or defending
against or appearing as a third-party witness in connection with any such loss,
claim, damage, liability or action. In addition to its other obligations under
this Section 7(c), each Underwriter severally agrees that, as an interim measure
during the pendency of 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 this Section 7(c), it will pay the
Company, such Selling Shareholder or such person on a monthly basis for all
reasonable legal or other expenses incurred in connection with investigating or
defending any such claim, action, investigation, inquiry or other proceeding,
notwithstanding the absence of a judicial determination as to the propriety and
enforceability of the Underwriters' obligation to indemnify hereunder or to pay
the Company, such Selling Shareholder or such person for such expenses and the
possibility that such payments might later be held to have been improper by a
court of competent jurisdiction. To the extent that any such interim payment is
so held to have been improper, the Company, such Selling Shareholder or such
person shall promptly return it to the Underwriters, together with interest
compounded daily, determined on the basis of the Prime Rate. Any such interim
payment that is not made to the Company, such Selling Shareholder or such person
within 30 days of a request for payment shall bear interest at the Prime Rate
from the date of such request.
(d) Promptly after receipt by an indemnified party under
Section 7(a), (b) or (c) hereof of notice of any claim or the commencement of
any action, the indemnified party shall, if a claim in respect thereof is to be
made against the indemnifying party under such subsection, notify the
indemnifying party in writing of the claim or the commencement of that action;
the failure to notify the indemnifying party shall not relieve it from any
liability that it may have to an indemnified party otherwise. If any such claim
or action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under such subsection for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation. The indemnified party
will have the right to employ its own counsel in any such action, but the fees,
expenses and other charges of such counsel will be at the expense of such
indemnified party unless (i) the employment of counsel by the indemnified party
has been authorized in writing by the indemnifying party, (ii) the indemnified
party has reasonably concluded (based on advice of counsel) that
Page 27
there may be legal defenses available to it or other indemnified parties that
are different from or in addition to those available to the indemnifying party,
(iii) a conflict or potential conflict exists (based on advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party (in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party), or (iv) the indemnifying
party has not in fact employed counsel to assume the defense of such action
within a reasonable time after receiving notice of the commencement of the
action, in each of which cases the reasonable fees, disbursements and other
charges of counsel will be at the expense of the indemnifying party or parties.
(e) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
Section 7(a), (b) or (c) hereof, then each indemnifying party shall contribute
to the amount paid or payable by such indemnified party as a result of the
losses, claims, damages or liabilities referred to in Section 7(a), (b) or (c)
hereof (i) in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Selling Shareholders, on the one hand, and the
Underwriters on the other from the offering of the 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
such Selling Shareholders, on the one hand, and the Underwriters, on the other,
in connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the Selling
Shareholders, on the one hand, and the Underwriters, on the other, shall be
deemed to be in the same proportion as the total net proceeds from the offering
(before deducting expenses) received by the Company and the Selling Shareholders
bear to the total underwriting discounts and commissions received by the
Underwriters, in each case as set forth in the table on the cover page of the
Final Prospectus. Relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the Selling Shareholders, on the one
hand, or the Underwriters, on the other, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The Company and the Underwriters agree that it
would not be just and equitable if contributions pursuant to this Section 7(e)
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
that does not take into account the equitable considerations referred to in the
first sentence of this Section 7(e). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or
Page 28
liabilities referred to in the first sentence of this Section 7(e) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending against any
action or claim that is the subject of this Section 7(e). Notwithstanding
the provisions of this Section 7(e), 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 it and distributed to the public were
offered to the public exceeds the amount of any damages that such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations in this Section
7(e) to contribute are several in proportion to their respective underwriting
obligations and not joint, and the Company's and each Selling Shareholder's
obligations in this Section 7(e) to contribute are several in proportion to
their respective proceeds from the sale of the Shares hereunder 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 shall promptly
give written notice of such service to the party or parties from whom
contributions 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. Notwithstanding the foregoing, in no event shall any Selling
Shareholder be liable hereunder for an amount in excess of the lesser of (i)
the proceeds received by such Selling Shareholder from the Underwriters
hereunder or (ii) an amount equal to (a) the total of such losses, claims,
damages, liabilities and expenses indemnified or contributed against
multiplied by (b) a fraction, the numerator of which is the number of Option
Shares sold by such Selling Shareholder hereunder and the denominator of
which is the total number of Shares sold hereunder.
(f) It is agreed that any controversy arising out of the operation of
the interim payment arrangements set forth in Sections 7(a), (b) and (c) hereof,
including the amounts of any requested payments and method of determining such
amounts, shall be settled by arbitration conducted under the provisions of the
Constitution and Rules of the Board of Governors of the New York Stock Exchange,
Inc. or pursuant to the Code of Arbitration Procedure of the National
Association of Securities Dealers, Inc. Any such arbitration shall be commenced
by service of a written demand for arbitration or written notice of intention to
arbitrate, therein electing the arbitration tribunal. In the event the party
demanding arbitration does not make such designation of an arbitration tribunal
in such demand or notice, then the party responding to said demand or notice is
authorized to do so. Such an arbitration shall be limited to the operation of
the interim payment provisions contained
Page 29
in Sections 7(a), (b) and (c) hereof and shall not resolve the ultimate
propriety or enforceability of the obligation to indemnify or pay expenses that
is created by the provisions of Sections 7(a), (b) and (c) hereof.
(g) The obligations of the Company and the Selling Shareholders under
this Section 7 shall be in addition to any liability that the Company and the
Selling Shareholders may otherwise have, and the obligations of the Underwriters
under this Section 7 shall be in addition to any liability that the respective
Underwriters may otherwise have.
8. SUBSTITUTION OF UNDERWRITERS.
(a) If any Underwriter defaults in its obligation to purchase the
number of Shares that it has agreed to purchase under this Agreement, the
nondefaulting Underwriters shall be obligated to purchase (in the respective
proportions that the number of Shares set forth opposite the name of each
nondefaulting Underwriter in Schedule I hereto bears to the total number of
Shares set forth opposite the names of all the nondefaulting Underwriters in
Schedule I hereto) the Shares that the defaulting Underwriter agreed but failed
to purchase; except that the nondefaulting Underwriters shall not be obligated
to purchase any of the Shares if the total number of Shares that the defaulting
Underwriter or Underwriters agreed but failed to purchase exceeds 10% of the
total number of Shares, and any nondefaulting Underwriter shall not be obligated
to purchase more than 110% of the number of Shares set forth opposite its name
in Schedule I hereto plus the total number of Option Shares purchasable by it
pursuant to the terms of Section 3 hereof. If the foregoing maximums are
exceeded, (i) the nondefaulting Underwriters, and any other underwriters
satisfactory to you who so agree, shall have the right, but shall not be
obligated, to purchase (in such proportions as may be agreed upon among them)
all the Shares. If the nondefaulting Underwriters or the other underwriters
satisfactory to you do not elect to purchase the Shares which the defaulting
Underwriter or Underwriters agreed but failed to purchase, this Agreement shall
terminate without liability on the part of any nondefaulting Underwriter, the
Company or the Selling Shareholders, except for the payment of expenses to be
borne by the Company and the Underwriters as provided in Section 5(h) hereof and
the indemnity and contribution agreements of the Company and the Underwriters
contained in Section 7 hereof.
(b) Nothing contained herein shall relieve a defaulting Underwriter
of any liability it may have for damages caused by its default. If the other
Underwriters satisfactory to you are obligated or agree to purchase the Shares
of a defaulting Underwriter, either you or the Company may postpone the First
Closing Date for up to seven full Business Days in order to effect any changes
that may be necessary in the Registration Statement, the Effective Prospectus or
the Final
Page 30
Prospectus or in any other document or agreement, and to file promptly any
amendments or any supplements to the Registration Statement or the Effective
Prospectus or the Final Prospectus that in your opinion may thereby be made
necessary.
9. EFFECTIVE DATE AND TERMINATION.
(a) This Agreement shall become effective at whichever of the
following times shall first occur: (i) at 8:00 A.M., Pacific standard time, on
the first full Business Day following either (x) the date upon which the
Registration Statement becomes effective or (y) if the Registration Statement
becomes effective in accordance with Rule 430A, the date upon which the Final
Prospectus is filed with your consent, or (ii) the time after the Registration
Statement becomes effective as you, in your discretion, shall first release the
Shares for sale to the public. For purpose of this Section 9, the Shares shall
be deemed to have been released for sale to the public upon release by you for
publication of a newspaper advertisement relating to the Shares or upon release
by you of communications offering the Shares for sale to securities dealers,
whichever shall first occur. Until this Agreement is effective, it may be
terminated by the Company by giving notice as hereinafter provided to you or by
you by giving notice as hereinafter provided to the Company, except that the
provisions of Sections 5(h) and 7 hereof shall at all times be effective.
(b) Until the First Closing Date, this Agreement may be terminated by
you by giving notice as hereinafter provided to the Company, if (i) the Company
or the Selling Shareholders shall have failed, refused or been unable, at or
prior to the First Closing Date, to perform any agreement on their respective
parts to be performed hereunder; (ii) any other condition of the obligations of
the Underwriters hereunder is not fulfilled; (iii) trading in securities
generally on the New York Stock Exchange or the American Stock Exchange or the
over-the-counter market shall have been suspended or minimum or maximum prices
or other material restrictions upon trading of securities generally shall have
been established on either of such exchanges or such market by the Commission or
by such exchange or other regulatory body, or governmental authority having
jurisdiction; (iv) a general banking moratorium shall have been declared by
federal or state authorities; or (v) there shall have been such a material
adverse change in economic, political, market or financial conditions (including
any material adverse effect of international conditions on the financial markets
in the United States) that, in your judgment, it is inadvisable, impractical or
undesirable to proceed with the delivery of the Shares. Any termination of this
Agreement pursuant to this Section 9 shall be without liability on the part of
the Company and the Selling Shareholders or any Underwriter, except as otherwise
provided in Sections 5(h) and 7 hereof.
Page 31
(c) This Agreement may also be terminated by you, by notice to the
Company, as to any obligation of the Underwriters to purchase the Option Shares,
upon the occurrence at any time prior to the Option Closing Date of any of the
events described in Section 9(b) hereof.
(d) Any notice referred to above may be given at the address
specified in Section 11 hereof in writing or by telegraph or telephone, and if
by telegraph or telephone, shall be immediately confirmed in writing.
10. SURVIVAL OF INDEMNITIES; CONTRIBUTION; WARRANTIES AND
REPRESENTATIONS. The indemnity and contribution agreements contained in
Section 7 hereof and the representations, warranties and agreements of the
Company in Section 1 hereof shall survive the delivery of the Shares to the
Underwriters hereunder and shall remain in full force and effect, regardless
of any termination or cancellation of this Agreement or any investigation
made by or on behalf of any indemnified party.
11. NOTICES. Except as otherwise provided in this Agreement, (a) whenever
notice is required by the provisions of this Agreement to be given to the
Company, such notice shall be in writing (and may be telecopied if confirmed by
letter) addressed to the Company at 0000 Xxxxx Xxxxxx Xxxxxxx, Xxxxx 000,
Xxxxxxxx, Xxxxxxx 00000, telecopier number (000) 000-0000, Attention: President;
and (b) whenever notice is required by the provisions of this Agreement to be
given to the several Underwriters, such notice shall be in writing addressed to
the Underwriters in care of Cruttenden Xxxx Incorporated, 00000 Xxx Xxxxxx,
Xxxxx 000, Xxxxxx, Xxxxxxxxxx 00000, telecopier number (000) 000-0000,
Attention: President.
12. INFORMATION FURNISHED BY UNDERWRITERS. The statements set forth in
the last paragraph on the cover page, the legend on page 2 with respect to
stabilization, and under the caption "Underwriting" in any Pre-Effective
Prospectus and in the Effective Prospectus and the Final Prospectus constitute
the written information furnished by or on behalf of any Underwriter referred to
in Sections 1(b) and (c) hereof and in Sections 7(a), (b) and (c) hereof.
13. PARTIES. This Agreement is made solely for the benefit of the several
Underwriters, the Company, the Selling Shareholders, any officer, director or
controlling person referred to in Section 7 hereof, and their respective
successors and assigns, and no other person shall acquire or have any right by
virtue of this Agreement. The term "successors and assigns," as used in this
Agreement, shall not include any purchaser of any of the Shares from any of the
Underwriters merely by reason of such purchase.
Page 32
14. DEFINITION OF "BUSINESS DAY." For purposes of this Agreement,
"Business Day" means any day other than Saturday, Sunday, a federal holiday or a
day on which the New York Stock Exchange is closed.
15. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of California, without giving effect to
the choice of law or conflict of laws principles thereof.
Page 33
16. COUNTERPARTS. This Agreement may be signed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement. Please confirm, by
signing and returning to us counterparts of this Agreement, that you are acting
on behalf of yourselves and the several Underwriters and that the foregoing
correctly sets forth the agreement among the Company and the several
Underwriters.
Very truly yours,
UNICOMP, INC.
By:
------------------------------------
Its
------------------------------------
SELLING SHAREHOLDERS LISTED ON SCHEDULE II
By:
------------------------------------
Attorney-in-Fact
Confirmed and accepted as of
the date first above mentioned
CRUTTENDEN XXXX INCORPORATED
as Representative of the Several
Underwriters named in Schedule I hereto
By:
-----------------------------
Page 34
SCHEDULE I
Underwriting Agreement dated ________, 1996
NUMBER OF MAXIMUM
FIRM SHARES NUMBER OF
UNDERWRITER TO BE PURCHASED OPTION SHARES
-------------------------------------------------------------------------------
Cruttenden Xxxx Incorporated...... 1,500,000 225,000
--------- -------
Total............................ 1,500,000 225,000
--------- -------
--------- -------
SCHEDULE II
Maximum
Number of Number of
Seller Firm Shares Option Shares
UniComp, Inc. .................. 1,500,000 75,000
Selling Shareholders:
J. Xxxxxxx Xxxxx ............... 50,000
Xxxxxx Xxxxxx .................. 50,000
B. Xxxxxxx Xxxxxx .............. 50,000
---------- -------
Total ........................... 1,500,000 225,000
---------- -------
---------- -------
Page 1
