2,250,000 Shares Common Stock, Par Value $0.15 Per Share Energy West, Incorporated UNDERWRITING AGREEMENT April ___, 2008
Exhibit 1.1
2,250,000 Shares
Common Stock, Par Value $0.15 Per Share
Energy West, Incorporated
Common Stock, Par Value $0.15 Per Share
Energy West, Incorporated
April ___, 2008
XXXXXX, XXXXX XXXXX, INCORPORATED
000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
LADENBURG XXXXXXXX & CO. INC.
000 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
LADENBURG XXXXXXXX & CO. INC.
000 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
The Company has prepared and filed with the Securities and Exchange Commission (the
"Commission”) a registration statement on Form S-1 (File No. 333-149668), which contains a form of
prospectus to be used in connection with the public offering and sale of the Offered Shares. Such
registration statement, as amended, including the financial statements, exhibits and schedules
thereto, in the form it was declared effective by the Commission under the Securities Act of 1933,
as amended (the “Act”), and the rules and regulations promulgated thereunder (“Securities Act
Regulations”), including any information deemed to be a part thereof at the time of effectiveness
pursuant to Rule 430A under the Securities Act, is called the “Registration Statement.” Any
preliminary prospectus included in the Registration Statement is hereinafter called a “Preliminary
Prospectus.” The prospectus, in the form first used by the Underwriters to confirm sales of the
Offered Shares or in the form first made available to the Underwriters by the Company to meet
requests of purchasers pursuant to Rule 173 under the Securities Act, is called the “Prospectus.”
As used herein, “Applicable Time” is 5:00 p.m. (New York time) on April ___, 2008. As used herein,
"free writing prospectus” has the meaning set forth in Rule 405 under the Securities Act, and “Time
of Sale Prospectus” means the Preliminary Prospectus, as amended or supplemented immediately prior
to the Applicable Time, together with the free
writing prospectuses, if any, identified in Schedule B hereto, and each “road show” (as
defined in Rule 433 under the Securities Act), if any, related to the offering of the Offered
Shares contemplated hereby that is a “written communication” (as defined in Rule 405 under the
Securities Act) (each such road show, a “Road Show”). As used herein, the terms “Registration
Statement”, “Preliminary Prospectus”, “Time of Sale Prospectus” and “Prospectus” shall include the
documents incorporated and deemed to be incorporated by reference therein. All references in this
Agreement to amendments or supplements to the Registration Statement, any Preliminary Prospectus,
the Time of Sale Prospectus or the Prospectus shall be deemed to mean and include the filing of any
document under the Exchange Act which is or is deemed to be incorporated by reference in the
Registration Statement, any Preliminary Prospectus, the Time of Sale Prospectus or the Prospectus,
as the case may be. All references in this Agreement to (i) the Registration Statement, any
Preliminary Prospectus, or the Prospectus, or any amendments or supplements to any of the
foregoing, shall include any copy thereof filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval System (“XXXXX”) and (ii) the Prospectus shall be deemed to
include the “electronic Prospectus” provided for use in connection with the offering of the Offered
Shares as contemplated by Section 3(n) of this Agreement.
All references in this Agreement to financial statements and schedules and other information
which are “contained,” “included” or “stated” in the Registration Statement, any Preliminary
Prospectus, the Time of Sale Prospectus or the Prospectus (and all other references of like import)
shall be deemed to mean and include all such financial statements and schedules and other
information which is or is deemed to be incorporated by reference in the Registration Statement or
the Prospectus, as the case may be; and all references in this Agreement to amendments or
supplements to the Registration Statement, any Preliminary Prospectus, the Time of Sale Prospectus
or the Prospectus, as the case may be, and all references in this Agreement to amendments or
supplements to the Registration Statement, any Preliminary Prospectus, the Time of Sale Prospectus
or the Prospectus shall be deemed to mean and include the filing of any document under the Exchange
Act which is or is deemed to be incorporated by reference in the Registration Statement, any
Preliminary Prospectus, the Time of Sale Prospectus or the Prospectus, as the case may be.
The Company hereby confirms its agreement with the Underwriters as follows:
The Company hereby represents, warrants and covenants to the Underwriters, as of the date of
this Agreement and as of each Closing Date (as hereinafter defined) and covenants with the
Underwriters, as follows:
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The Preliminary Prospectus dated April 21, 2008, the Time of Sale Prospectus and the
Prospectus when filed complied in all material respects with the Securities Act and, if filed by
electronic transmission pursuant to XXXXX (except as may be permitted by Regulation S-T under the
Securities Act), was identical to the copy thereof delivered to the Underwriters for use in
connection with the offer and sale of the Offered Shares. Each of the Registration Statement and
any post-effective amendment thereto, at the time it became effective and at all subsequent times,
complied and will comply in all material respects with the Securities Act and did not and will not
contain any untrue statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under which they were made, not
misleading. As of the Applicable Time, the Time of Sale Prospectus did not, and at the time of
each sale of the Offered Shares and at the First Closing Date (as defined below) and each Option
Closing Date (as defined below), the Time of Sale Prospectus, as then amended or supplemented by
the Company, if applicable, will not, contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The Prospectus, as amended or
supplemented, as of its date and at all subsequent times, did not and will not contain any untrue
statement of a material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not misleading.
The representations and warranties set forth in the three immediately preceding sentences do not
apply to statements in or omissions from the Registration Statement, or any post-effective
amendment thereto, or the Prospectus or the Time of Sale Prospectus, or any amendments or
supplements thereto, made in reliance upon and in conformity with information relating to the
Underwriters furnished to the Company in writing by Xxxxxx, Xxxxx Xxxxx, Incorporated (“Xxxxxx”)
expressly for use therein, it being understood and agreed that the only such information furnished
by Xxxxxx to the Company consists of the information described in Section 9(b) below. There are no
contracts or other documents required to be described in the Time of Sale Prospectus or the
Prospectus or to be filed as exhibits to the Registration Statement which have not been described
or filed as required.
The Company is not an “ineligible issuer” in connection with the offering of the Offered
Shares pursuant to Rules 164, 405 and 433 under the Securities Act. Any free writing prospectus
that the Company is required to file pursuant to Rule 433(d) under the Securities Act has been, or
will be, filed with the Commission in accordance with the requirements of the Securities Act. Each
free writing prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d)
under the Securities Act or that was prepared by or on behalf of or used or referred to by the
Company complies or will comply in all material respects with the requirements of Rule 433 under
the Securities Act including timely filing with the Commission or retention where required and
legending, and each such free writing prospectus, as of its issue date and at all subsequent times
through the completion of the public offer and sale of the Offered Shares did not, does not and
will not include any information that conflicted, conflicts with or will conflict with the
information contained in the Registration Statement or the Prospectus, including any document
incorporated by reference therein. Except for the free writing prospectuses, if any, identified in
Schedule B hereto, and electronic road shows, if any, furnished to you before first use,
the Company has not prepared, used or referred to, and will not, without your prior consent,
prepare, use or refer to, any free writing prospectus.
3
(d) The Underwriting Agreement. This Agreement has been duly authorized, executed and
delivered by, and is a valid and binding agreement of, the Company, enforceable in accordance with
its terms, except as rights to indemnification hereunder may be limited by applicable law and
except as the enforcement hereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the rights and remedies of creditors or
by general equitable principles.
4
an untrue statement of a material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were made, not
misleading; and any further documents so filed and incorporated by reference in the Registration
Statement or Prospectus, when such documents become effective or are filed with the Commission, as
the case may be, will conform to the requirements of the Securities Act or the Exchange Act, as
applicable, and will not contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein not misleading.
5
Prospectus under the captions “Prospectus Summary — Summary Financial Data,” “Selected
Consolidated Financial Data” and “Capitalization” fairly present the information set forth therein
on a basis consistent with that of the audited financial statements contained in the Registration
Statement, the Time of Sale Prospectus and the Prospectus. To the Company’s knowledge, no person
who has been suspended or barred from being associated with a registered public accounting firm, or
who has failed to comply with any sanction pursuant to Rule 5300 promulgated by the PCAOB, has
participated in or otherwise aided the preparation of, or audited, the financial statements,
supporting schedules or other financial data filed with the Commission as a part of the
Registration Statement and included in the Time of Sale Prospectus or the Prospectus.
6
attached hereto and (ii) such other entities omitted from Schedule C which, when such omitted
entities are considered in the aggregate as a single subsidiary, would not constitute a
“significant subsidiary” within the meaning of Rule 1-02(w) of Regulation S-X.
7
been duly authorized by all necessary corporate action and do not and will not, whether with or
without the giving of notice or passage of time or both, conflict with or constitute a breach of,
or default or Repayment Event (as defined below) under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the Company or any of its
Subsidiaries pursuant to, the Agreements and Instruments, nor will such action result in any
violation of (A) the provisions of any charter, bylaws, partnership agreement, limited liability
company agreement or other governing documents of the Company or any of its Subsidiaries or (B) any
applicable law, statute, rule, regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having jurisdiction over the Company or
any of its Subsidiaries or any of their assets, properties or operations, which violations, in the
case of clause (B), would, individually or in the aggregate, have a Material Adverse Change. As
used herein, a “Repayment Event” means any event or condition that gives the holder of any note,
debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the
right to require the repurchase, redemption or repayment of all or a portion of such indebtedness
by the Company or any of its Subsidiaries. Except for permits, consents, approvals and similar
authorizations required under the securities or “Blue Sky” laws of certain jurisdictions, and
except for such permits, consents, approvals and authorizations which have been obtained, no
permit, 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.
(q) Accuracy of Exhibits. There are no contracts or documents that are required to be
described in the Registration Statement, the Time of Sale Prospectus, the Prospectus or the
documents incorporated by reference therein or to be filed as exhibits thereto that have not been
8
so described and filed as required.
9
10
company” as such terms are defined in the Investment Company Act and will conduct its business in a
manner so that it will not become subject to the Investment Company Act.
11
included or incorporated by reference in the Registration Statement, the Time of Sale Prospectus
and the Prospectus are based on or derived from sources that the Company believes to be reliable
and accurate or represent the Company’s good faith estimates that are made on the basis of data
derived from such sources.
12
respective businesses and the volume of their respective properties as is customarily maintained by
companies similar to the Company engaged in the same or substantially similar business, and all
such insurance is in full force and effect. The Company has no reason to believe that it or any
Subsidiary will not be able (i) to renew its existing insurance coverage as and when such policies
expire or (ii) to obtain comparable coverage from similar institutions as may be necessary or
appropriate to conduct its business as now conducted and at a cost that would not result in a
Material Adverse Change. Neither of the Company nor any Subsidiary has been denied any insurance
coverage which it has sought or for which it has applied.
13
significant role in the Company’s internal control over financial reporting. The Company is not
aware of any change in its internal control over financial reporting that has occurred during its
most recent fiscal quarter that has materially affected, or is reasonably likely to materially
affect, the Company’s internal control over financial reporting. The Company is otherwise in
compliance in all material respects with all applicable effective provisions of the Xxxxxxxx-Xxxxx
Act and the rules and regulations promulgated by the Commission.
14
and the regulations and published interpretations thereunder (the “Code”) of which the Company or
such subsidiary is a member. No “reportable event” (as defined under ERISA) has occurred or is
reasonably expected to occur with respect to any “employee benefit plan” established or maintained
by the Company, its subsidiaries or any of their ERISA Affiliates. No “employee benefit plan”
established or maintained by the Company, its subsidiaries or any of their ERISA Affiliates, if
such “employee benefit plan” were terminated, would have any “amount of unfunded benefit
liabilities” (as defined under ERISA). Neither the Company, its subsidiaries nor any of their ERISA
Affiliates has incurred or reasonably expects to incur any liability under (i) Title IV of ERISA
with respect to termination of, or withdrawal from, any “employee benefit plan” or (ii) Sections
412, 4971, 4975 or 4980B of the Code. Each “employee benefit plan” established or maintained by the
Company, its subsidiaries or any of their ERISA Affiliates that is intended to be qualified under
Section 401(a) of the Code is so qualified and nothing has occurred, whether by action or failure
to act, which would cause the loss of such qualification.
15
Any certificate signed by any officer of the Company or any of its subsidiaries and delivered
to any of the Underwriters or to counsel for any of the Underwriter shall be deemed a
representation and warranty by the Company to the Underwriters as to the matters covered thereby.
The Company acknowledges that the Underwriters and, for purposes of the opinions to be
delivered pursuant to Section 6 hereof, counsel to the Company and counsel to any of the
Underwriters, will rely upon the accuracy and truthfulness of the foregoing representations and
hereby consents to such reliance.
16
Underwriters are exercising the option, (ii) the names and denominations in which the certificates
for the Option Shares are to be registered and (iii) the time, date and place at which such
certificates will be delivered (which time and date may be simultaneous with, but not earlier than,
the First Closing Date; and in such case the term “First Closing Date” shall refer to the time and
date of delivery of certificates for the Firm Shares and such Option Shares). Such time and date
of delivery, if subsequent to the First Closing Date, is called an “Option Closing Date” and shall
be determined by Xxxxxx and shall not be earlier than three (3) nor later than five (5) full
business days after delivery of such notice of exercise. Together with the First Closing Date,
each Option Closing Date may each be referred to herein as a “Closing Date.” If any Option Shares
are to be purchased, each Underwriter agrees, severally and not jointly, to purchase the number of
Option Shares (subject to such adjustments to eliminate fractional shares as Xxxxxx may determine)
that bears the same proportion to the total number of Option Shares to be purchased as the number
of Firm Shares set forth on Schedule A opposite the name of such Underwriter bears to the total
number of Firm Shares. Xxxxxx may cancel the option at any time prior to its expiration by giving
written notice of such cancellation to the Company.
It is understood that Xxxxxx has been authorized, for its own account and the accounts of the
several Underwriters, to accept delivery of and receipt for, and make payment of the purchase price
for, the Firm Shares and any Option Shares the Underwriters have agreed to purchase. Xxxxxx,
individually and not in a representative capacity for the Underwriters, may (but shall not be
obligated to) make payment for any Offered Shares to be purchased by any Underwriter whose funds
shall not have been received by Xxxxxx by the First Closing Date or the applicable Option Closing
Date, as the case may be, for the account of such Underwriter, but any such payment shall not
relieve such Underwriter from any of its obligations under this Agreement.
17
against the irrevocable release of a wire transfer of immediately available funds for the amount of
the purchase price therefor, by causing DTC to credit the Option Shares to the account of the
Underwriters at DTC. The certificates for the Offered Shares shall be registered in such names and
denominations as Xxxxxx shall have requested at least two full business days prior to the First
Closing Date (or the applicable Option Closing Date, as the case may be) and shall be made
available for inspection on the business day preceding the First Closing Date (or the applicable
Option Closing Date, as the case may be) at a location in New York City as Xxxxxx may designate.
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 the Underwriters.
The Company further covenants and agrees with each Underwriter as follows:
(a) Delivery of Registration Statement, Time of Sale Prospectus and Prospectus. The Company
shall furnish to you, without charge, [___] signed copies of the Registration Statement, any
amendments thereto and shall furnish to you in Baltimore, Maryland, without charge, prior to 10:00
a.m. Eastern time on the business day next succeeding the date of this Agreement and during the
period mentioned in Section 3(e) or 3(f) below, as many copies of the Time of Sale Prospectus, the
Prospectus and any supplements and amendments thereto or to the Registration Statement as you may
reasonably request.
18
statement of a material fact or omitted or would omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances prevailing at that subsequent
time, not misleading, the Company shall promptly amend or supplement such free writing prospectus
to eliminate or correct such conflict so that the statements in such free writing prospectus as so
amended or supplemented will not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of the circumstances
prevailing at such subsequent time, not misleading, as the case may be; provided, however, that
prior to amending or supplementing any such free writing prospectus, the Company shall furnish to
Xxxxxx for review, a reasonable amount of time prior to the proposed time of filing or use thereof,
a copy of such proposed amended or supplemented free writing prospectus and the Company shall not
file, use or refer to any such amended or supplemented free writing prospectus without Xxxxxx’
consent, provided such consent is not unreasonably withheld or delayed.
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Prospectus, (iii) of the time and date that any post-effective amendment to the Registration
Statement becomes effective and (iv) of the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement or any post-effective amendment thereto, or any
amendment or supplement to any Preliminary Prospectus, the Time of Sale Prospectus or the
Prospectus or of any order preventing or suspending the use of any Preliminary Prospectus, the Time
of Sale Prospectus, any free writing prospectus or the Prospectus, or of any proceedings to remove,
suspend or terminate from listing or quotation the Shares from any securities exchange upon which
they are listed for trading or included or designated for quotation, or of the threatening or
initiation of any proceedings for any of such purposes. If the Commission shall enter any such
stop order at any time, the Company will use its best efforts to obtain the lifting of such order
at the earliest possible moment. Additionally, the Company agrees that it shall comply with the
provisions of Rule 424(b), Rule 433 and Rule 430A, as applicable, under the Securities Act and will
use its reasonable efforts to confirm that any filings made by the Company under such Rule 424(b)
or Rule 433 were received in a timely manner by the Commission.
20
21
following the date of this Agreement (as the same may be extended as described below, the “Lock-up
Period”), the Company will not, without the prior written consent of Xxxxxx (which consent may be
withheld at the sole discretion of Xxxxxx), directly or indirectly, sell (including, without
limitation, any short sale), offer, contract or grant any option to sell, pledge, transfer or
establish an open “put equivalent position” within the meaning of Rule 16a-1(h) under the Exchange
Act, or otherwise dispose of or transfer, or announce the offering of, or file any registration
statement under the Securities Act in respect of, any Shares, options, rights or warrants to
acquire Shares or securities exchangeable or exercisable for or convertible into Shares (other than
as contemplated by this Agreement with respect to the Offered Shares) or publicly announce the
intention to do any of the foregoing; provided, however, that the Company (1) may issue Shares or
options to purchase Shares upon exercise of options any may file registration statements on Form
S-8 related or pursuant to any stock option, stock bonus or other stock plan or arrangement
described in each Prospectus or (2) may issue Shares to acquire interests in Cut Bank Gas Company
as disclosed in the Registration Statement, the Time of Sale Prospectus and the Prospectus.
Notwithstanding the foregoing, if (i) during the last 17 days of the Lock-up Period, the Company
issues an earnings release or material news or a material event relating to the Company occurs or
(ii) prior to the expiration of the Lock-up Period, the Company announces that it will release
earnings results during the 16-day period beginning on the last day of the Lock-up Period, then in
each case the Lock-up Period will be extended until the expiration of the 18-day period beginning
on the date of the issuance of the earnings release or the occurrence of the material news or
material event, as applicable, unless Xxxxxx waives, in writing, such extension (which waiver may
be withheld at the sole discretion of Xxxxxx), except that such extension will not apply if, (i)
within three business days prior to the 15th calendar day before the last day of the Lock-up
Period, the Company delivers a certificate, signed by the Chief Financial Officer or Chief
Executive Officer of the Company, certifying on behalf of the Company that (i) the Shares are
“actively traded securities” (as defined in Regulation M), (ii) the Company meets the applicable
requirements of paragraph (a)(1) of Rule 139 under the Securities Act in the manner contemplated by
NASD Conduct Rule 2711(f)(4), and (iii) the provisions of NASD Conduct Rule 2711(f)(4) are not
applicable to any research reports relating to the Company published or distributed by the
Underwriters during the 15 days before or after the last day of the Lock-up Period (before giving
effect to such extension). The Company will provide Xxxxxx with prior notice of any such
announcement that gives rise to an extension of the Lock-up Period.
22
in the notice), the Company will, and shall cause each of its affiliates to, comply with Rule 102
as though such exception were not available but the other provisions of Rule 102 (as interpreted by
the Commission) did apply.
Xxxxxx may, in its sole discretion, waive in writing the performance by the Company of any one
or more of the foregoing covenants or extend the time for their performance.
The Company agrees to pay for itself all costs, fees and expenses incurred in connection with
the performance of their obligations hereunder and in connection with the transactions contemplated
hereby, including without limitation (i) all expenses incident to the issuance and delivery of the
Offered Shares (including all printing and engraving costs), (ii) all fees and expenses of the
registrar and transfer agent of the Shares, (iii) all necessary issue, transfer and other stamp
taxes in connection with the issuance and sale of the Offered Shares to the Underwriters, (iv) all
fees and expenses of the Company’s counsel, independent public or certified public accountants and
other advisors, (v) all costs and expenses incurred in connection with the preparation, printing,
filing, shipping and distribution of the Registration Statement (including financial statements,
exhibits, schedules, consents and certificates of experts), the Time of Sale Prospectus, the
Prospectus, any free writing prospectus prepared by or on behalf of, used by, or referred to by the
Company, each Preliminary Prospectus, and all amendments and supplements thereto, and this
Agreement, (vi) all filing fees, attorneys’ fees and expenses incurred by the Company or filing
fees incurred by the Underwriters in connection with
23
qualifying or registering (or obtaining exemptions from the qualification or registration of) all
or any part of the Offered Shares for offer and sale under the state securities or blue sky laws or
the provincial securities laws of Canada, and, if requested by Xxxxxx, preparing and printing a
"Blue Sky Survey” or memorandum, and any supplements thereto, advising the Underwriters of such
qualifications, registrations, determinations and exemptions, (vii) the filing fees incident to
FINRA’s review, if any, and approval of the Underwriters’ participation in the offering and
distribution of the Offered Shares, (viii) the costs and expenses of the Company relating to
investor presentations on any “road show” undertaken in connection with the marketing of the
offering of the Offered Shares, including, without limitation, expenses associated with the
preparation or dissemination of any electronic roadshow, expenses associated with the production of
roadshow slides and graphics, fees and expenses of any consultants engaged in connection with the
roadshow presentations with the prior approval of the Company, travel and lodging expenses of the
representatives, employees and officers of the Company and of Xxxxxx and any such consultants, and
the cost of any aircraft chartered in connection with the roadshow, (ix) the fees and expenses
associated with including the Offered Shares on the Nasdaq Stock Market, LLC, and (x) all other
fees, costs and expenses of the nature referred to in Item 14 of Part II of the Registration
Statement. In addition, the Company agrees to reimburse Xxxxxx for fees and expenses, including
reasonable legal fees, Xxxxxx has incurred relating to the offering and sale of the Offered
Securities, including, but not limited to, the formation of an underwriting group, due diligence,
and negotiation of this Agreement, in an amount not to exceed $125,000. Except as provided in this
Section 4, Section 7, Section 9 and Section 10 hereof, the Underwriter shall pay its own expenses.
Section 5. Covenant of the Underwriters. Each Underwriter severally and not jointly,
covenants with the Company not to take any action that would result in the Company being required
to file with the Commission pursuant to Rule 433(d) under the Securities Act a free writing
prospectus prepared by or on behalf of such Underwriter that otherwise would not be required to be
filed by the Company thereunder, but for the action of the Underwriter.
Section 6. Conditions of the Obligations of the Underwriters. The obligations of the several
Underwriters to purchase and pay for the Offered Shares as provided herein on the First Closing
Date and, with respect to the Option Shares, each Option Closing Date, shall be subject to the
accuracy of the representations and warranties on the part of the Company set forth in Section 1
hereof as of the date hereof and as of the First Closing Date as though then made and, with respect
to the Option Shares, as of each Option Closing Date as though then made, to the timely performance
by the Company of its covenants and other obligations hereunder, and to each of the following
additional conditions:
24
confirming that they are (A) an independent registered public accounting firm as required by the
Securities Act and the Exchange Act and (B) in compliance with the applicable requirements relating
to the qualification of accountants under Rule 2-01 of Regulation S-X.
(i) the Company shall have filed the Prospectus with the Commission (including the final
pricing and any other information previously omitted pursuant to Rule 430A under the Securities
Act) in the manner and within the time period required by Rule 424(b) under the Securities Act;
(ii) no stop order suspending the effectiveness of the Registration Statement, or any
post-effective amendment to the Registration Statement, shall be in effect and no proceedings for
such purpose shall have been instituted or threatened by the Commission and any request on the part
of the Commission for additional information shall have been complied with; and
(iii) FINRA shall have raised no objection to the fairness and reasonableness of the
underwriting terms and arrangements.
(i) in the reasonable judgment of Xxxxxx there shall not have occurred any Material Adverse
Change; and
(ii) there shall not have occurred any downgrading, nor shall any notice have been given of
any intended or potential downgrading or of any review for a possible change that does not indicate
the direction of the possible change, in the rating accorded any securities of the Company or any
of its subsidiaries by any “nationally recognized statistical rating organization” as such term is
defined for purposes of Rule 436(g)(2) under the Securities Act.
(i) the opinion of Xxxxxxx Xxxxxxx & Xxxxxx P.L.L., the form of which is attached as
Exhibit A;
(ii) the opinion of Xxxxxxxx, Kaleczyk, Xxxxx & Xxxxx, P.C., the form of which is attached as
Exhibit B; and
(iii) the opinions of each of Associated Legal Group, LLC, Blanchard, Miller,
25
Xxxxx & Xxxxxx PA, Xxxxxxx, Xxxxxxx and Xxxxxx, and Xxxxxxxxxx & Cross, LLP, each in the form
attached as Exhibit C.
(i) for the period from and after the date of this Agreement through and prior to such Closing
Date, there has not occurred any Material Adverse Change;
(ii) the representations, warranties and covenants of the Company set forth in Section 1 of
this Agreement are true and correct with the same force and effect as though expressly made on and
as of such Closing Date; and
(iii) the Company has complied with all the agreements hereunder and satisfied all the
conditions on its part to be performed or satisfied hereunder at or prior to such Closing Date.
26
the Company shall have maintained a listing of the Company’s common stock on the Nasdaq Stock
Market, LLC.
If any condition specified in this Section 6 is not satisfied when and as required to be
satisfied in the reasonable determination of Xxxxxx, this Agreement may be terminated by Xxxxxx by
notice to the Company at any time on or prior to the First Closing Date and, with respect to the
Option Shares, at any time prior to the applicable Option Closing Date, which termination shall be
without liability on the part of any party to any other party, except that Section 4, Section 7,
Section 9 and Section 10 shall at all times be effective and shall survive such termination.
Section 7. Reimbursement of Underwriter Expenses. If the sale to the Underwriters of the
Offered Shares on the First Closing Date is not consummated because of any refusal, inability or
failure on the part of the Company to perform any agreement herein or to comply with any provision
hereof, the Company agrees to reimburse the Underwriters upon demand for all out-of-pocket expenses
that shall have been reasonably incurred by the Underwriters in connection with the proposed
purchase and the offering and sale of the Offered Shares, including but not limited to fees and
disbursements of counsel, printing expenses, travel expenses, postage, facsimile and telephone
charges.
Section 8. Effectiveness of this Agreement. This Agreement shall become effective upon the
execution of this Agreement by the parties hereto.
27
pursuant to Rule 430A under the Securities Act, or the omission or alleged omission therefrom of a
material fact required to be stated therein or necessary to make the statements therein not
misleading; or (ii) any untrue statement or alleged untrue statement of a material fact contained
in any Preliminary Prospectus, the Time of Sale Prospectus, any free writing prospectus that the
Company has used, referred to or filed, or is required to file, pursuant to Rule 433(d) of the
Securities Act or the Prospectus (or any amendment or supplement thereto), or the omission or
alleged omission therefrom of a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading; or (iii) any act or
failure to act or any alleged act or failure to act by any Underwriter in connection with, or
relating in any manner to, the Offered Shares or the offering contemplated hereby, and which is
included as part of or referred to in any loss, claim, damage, liability or action arising out of
or based upon any matter covered by clause (i) or (ii) above, provided that the Company shall not
be liable under this clause (iii) to the extent that a court of competent jurisdiction shall have
determined by a final judgment that such loss, claim, damage, liability or action resulted directly
from any such acts or failures to act undertaken or omitted to be taken by such Underwriter through
its bad faith or willful misconduct; and to reimburse each Underwriter and each such officer,
employee and controlling person for any and all expenses (including the fees and disbursements of
counsel chosen by Xxxxxx) as such expenses are reasonably incurred by such Underwriter or such
officer, employee or controlling person in connection with investigating, defending, settling,
compromising or paying (subject to paragraph (d) below) any such loss, claim, damage, liability,
expense or action; provided, however, that the foregoing indemnity agreement shall not apply to any
loss, claim, damage, liability or expense to the extent, but only to the extent, arising out of or
based upon any untrue statement or alleged untrue statement or omission or alleged omission made in
reliance upon and in conformity with written information furnished to the Company by Xxxxxx
expressly for use in the Registration Statement, the Time of Sale Prospectus, any such free writing
prospectus or the Prospectus (or any amendment or supplement thereto), it being understood and
agreed that the only such information furnished by Xxxxxx to the Company consists of the
information described in subsection (b) below. The indemnity agreement set forth in this Section
9(a) shall be in addition to any liabilities that the Company may otherwise have.
28
therein or necessary to make the statements therein not misleading, in each case to the extent, but
only to the extent, that such untrue statement or alleged untrue statement or omission or alleged
omission was made in the Registration Statement, any Preliminary Prospectus, the Time of Sale
Prospectus, such free writing prospectus that the Company has used, referred to or filed, or is
required to file, pursuant to Rule 433(d) of the Securities Act or the Prospectus (or such
amendment or supplement thereto), in reliance upon and in conformity with written information
furnished to the Company by or on behalf of Xxxxxx expressly for use therein; and to reimburse the
Company, or any such director, officer or controlling person for any legal and other expense
reasonably incurred by the Company, or any such director, officer or controlling person in
connection with investigating, defending, settling, compromising or paying (subject to paragraph
(d) below) any such loss, claim, damage, liability, expense or action. The Company hereby
acknowledges that the only information that Xxxxxx has furnished to the Company expressly for use
in the Registration Statement, any Preliminary Prospectus, the Time of Sale Prospectus, any free
writing prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d) of
the Securities Act or the Prospectus (or any amendment or supplement thereto) are the statements
set forth under the caption “Underwriting” in the Prospectus. The indemnity agreement set forth in
this Section 9(b) shall be in addition to any liabilities that each Underwriter may otherwise have.
29
liable for the fees and expenses of more than one separate counsel (together with local counsel),
representing the indemnified parties who are parties to such action), which counsel (together with
any local counsel) for the indemnified parties shall be selected by Xxxxxx (in the case of counsel
for the indemnified parties referred to in Section 9(a) above) or by the Company (in the case of
counsel for the indemnified parties referred to in Section 9(b) above)), (ii) the indemnifying
party shall not have assumed the defense of such action within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within a reasonable time
after notice of commencement of the action, in each of which cases the fees and expenses of counsel
shall be at the expense of the indemnifying party and shall be paid as they are incurred.
Section 10. Contribution. If the indemnification provided for in Section 9 is for any reason
held to be unavailable to or otherwise insufficient to hold harmless an indemnified party in
respect of any losses, claims, damages, liabilities or expenses referred to therein, then each
indemnifying party shall contribute to the aggregate amount paid or payable by such indemnified
party, as incurred, as a result of any losses, claims, damages, liabilities or expenses referred to
therein (i) in such proportion as is appropriate to reflect the relative benefits received by the
Company, on the one hand, and the Underwriters, on the other hand, from the offering of the Offered
Shares pursuant to this Agreement or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the Company, on the one
hand, and the Underwriters, on the other hand, in connection with the statements or omissions which
resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company, on the one hand, and the
Underwriters, on the other hand, in connection with the offering of the Offered Shares pursuant to
this Agreement shall be deemed to be in the same respective proportions as
30
the total net proceeds from the offering of the Offered Shares pursuant to this Agreement (before
deducting expenses) received by the Company, and the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth on the front cover page of the Prospectus
bear to the aggregate public offering price of the Offered Shares as set forth on such cover. The
relative fault of the Company, on the one hand, and the Underwriters, on the other hand, shall be
determined by reference to, among other things, whether any such untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact relates to information
supplied by the Company, on the one hand, or the Underwriters, on the other hand, and the parties’
relative intent, knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The amount paid or payable by a party as a result of the losses, claims, damages, liabilities
and expenses referred to above shall be deemed to include, subject to the limitations set forth in
Section 9(c), any legal or other fees or expenses reasonably incurred by such party in connection
with investigating or defending any action or claim. The provisions set forth in Section 9(c) with
respect to notice of commencement of any action shall apply if a claim for contribution is to be
made under this Section 10; provided, however, that no additional notice shall be required with
respect to any action for which notice has been given under Section 9(c) for purposes of
indemnification.
The Company and the Underwriters agree that it would not be just and equitable if contribution
pursuant to this Section 10 were determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to in this Section 10.
Notwithstanding the provisions of this Section 10, no Underwriter shall be required to
contribute any amount in excess of the underwriting discounts and commissions received by it in
connection with the Offered Shares underwritten by it and distributed to the public. 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 to contribute pursuant to this Section 10 are
several, and not joint, in proportion to their respective underwriting commitments as set forth
opposite their respective names on Schedule A. For purposes of this Section 10, each officer and
employee of an Underwriter and each person, if any, who controls an Underwriter within the meaning
of the Securities Act or the Exchange Act shall have the same rights to contribution as such
Underwriter, and each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company with the meaning of the
Securities Act and the Exchange Act shall have the same rights to contribution as the Company.
Section 11. Termination of this Agreement. Prior to the purchase of the Firm Shares by the
Underwriters on the First Closing Date, this Agreement may be terminated by Xxxxxx by notice given
to the Company if at any time (i) trading or quotation in any of the Company’s securities shall
have been suspended or limited by the Commission or by the Nasdaq Stock Market, LLC, or trading in
securities generally on either the Nasdaq Stock Market, LLC or the New York Stock Exchange shall
have been suspended or limited, or minimum or maximum
31
prices shall have been generally established on any of such stock exchanges by the Commission or
FINRA; (ii) a general banking moratorium shall have been declared by any of federal, New York or
Maryland authorities; (iii) there shall have occurred any outbreak or escalation of national or
international hostilities or any crisis or calamity, or any change in the United States or
international financial markets, or any substantial change or development involving a prospective
substantial change in United States’ or international political, financial or economic conditions,
that in the reasonable judgment of Xxxxxx is material and adverse and makes it impracticable or
inadvisable to market the Offered Shares in the manner and on the terms described in the Time of
Sale Prospectus or the Prospectus or to enforce contracts for the sale of securities; (iv) in the
reasonable judgment of Xxxxxx there shall have occurred any Material Adverse Change; or (v) the
Company shall have sustained a loss by strike, fire, flood, earthquake, accident or other calamity
of such character as in the reasonable judgment of Xxxxxx may interfere materially with the conduct
of the business and operations of the Company regardless of whether or not such loss shall have
been insured. Any termination pursuant to this Section 11 shall be without liability on the part of
(a) the Company to any Underwriter, (b) any Underwriter to the Company, or (c) of any party hereto
to any other party except that the provisions of Section 9 and Section 10 shall at all times be
effective and shall survive such termination.
Section 12. No Advisory or Fiduciary Relationship. The Company acknowledges and agrees that
(a) the purchase and sale of the Offered Shares pursuant to this Agreement, including the
determination of the public offering price of the Offered Shares and any related discounts and
commissions, is an arm’s-length commercial transaction between the Company, on the one hand, and
the several Underwriters, on the other hand, (b) in connection with the offering contemplated
hereby and the process leading to such transaction each Underwriter is and has been acting solely
as a principal and is not the agent or fiduciary of the Company, or its stockholders, creditors,
employees or any other party, (c) no Underwriter has assumed or will assume an advisory or
fiduciary responsibility in favor of the Company with respect to the offering contemplated hereby
or the process leading thereto (irrespective of whether such Underwriter has advised or is
currently advising the Company on other matters) and no Underwriter has an obligation to the
Company with respect to the offering contemplated hereby except the obligations expressly set forth
in this Agreement, (d) the Underwriters and their respective affiliates may be engaged in a broad
range of transactions that involve interests that differ from those of the Company, and (e) the
Underwriters have not provided any legal, accounting, regulatory or tax advice with respect to the
offering contemplated hereby and the Company has consulted its own legal, accounting, regulatory
and tax advisors to the extent it deemed appropriate.
Section 13. Research Analyst Independence. The Company acknowledges that the Underwriters’
research analysts and research department are required to and should be independent from their
respective investment banking divisions and are subject to certain regulations and internal
policies, and as such Underwriters’ research analysts may hold views and make statements or
investment recommendations and/or publish research reports with respect to the Company or the
offering that differ from the views of their respective investment banking divisions. The Company
understands that each of the Underwriters is a full service securities firm and as such from time
to time, subject to applicable securities laws, may effect transactions for its account or the
account of its customers and hold long and short positions in
32
debt or equity securities of the companies that may be the subject of the transactions contemplated
by this Agreement.
Section 14. Representations and Indemnities to Survive Delivery. The respective indemnities,
agreements, representations, warranties and other statements of the Company, of its officers and of
the several Underwriters set forth in or made pursuant to this Agreement will remain in full force
and effect, regardless of any investigation made by or on behalf of any Underwriter or the Company
or any of its partners, officers or directors or any controlling person, as the case may be, and,
anything herein to the contrary notwithstanding, will survive delivery of and payment for the
Offered Shares sold hereunder and any termination of this Agreement.
Section 15. Notices. All communications hereunder shall be in writing and shall be mailed,
hand delivered or telecopied and confirmed to the parties hereto as follows:
If to the Underwriters:
Xxxxxx, Xxxxx Xxxxx, Incorporated
000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Corporate Finance
000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Corporate Finance
Ladenburg Xxxxxxxx & Co. Inc.
000 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxx X. Xxxx
000 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxx X. Xxxx
with a copy to:
Xxxxxxx LLP
Xxx Xxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxxx, Xx., Esq.
Xxx Xxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxxx, Xx., Esq.
If to the Company:
Energy West, Incorporated
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxx 00000
Facsimile: (000) 000-0000
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxx 00000
Facsimile: (000) 000-0000
33
Attention:
Xxxxxx X. Xxxxx
with a copy to:
Xxxxxxx Xxxxxxx and Xxxxxx P.L.L.
0000 Xxxx Xxxxx Xxxxxx
Xxx Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxx, Xxxx 00000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxxxxxx X. Xxxxxxx, Esq.
0000 Xxxx Xxxxx Xxxxxx
Xxx Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxx, Xxxx 00000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxxxxxxx X. Xxxxxxx, Esq.
Any party hereto may change the address for receipt of communications by giving written notice
to the others.
Section 17. Partial Unenforceability. The invalidity or unenforceability of any Section,
paragraph or provision of this Agreement shall not affect the validity or enforceability of any
other Section, paragraph or provision hereof. If any Section, paragraph or provision of this
Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be
made such minor changes (and only such minor changes) as are necessary to make it valid and
enforceable.
Section 18. Governing Law Provisions. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Maryland applicable to agreements made and to be
performed in such state. Any legal suit, action or proceeding arising out of or based upon this
Agreement or the transactions contemplated hereby may be instituted in the federal courts of the
United States of America located in [Baltimore, Maryland or the courts of the State of Maryland in
each case located in the city of Baltimore] (collectively, the “Specified Courts”), and each party
irrevocably submits to the exclusive jurisdiction (except for proceedings instituted in regard to
the enforcement of a judgment of any such court, as to which such jurisdiction is non-exclusive) of
such courts in any such suit, action or proceeding. Service of any process, summons, notice or
document by mail to such party’s address set forth above shall be effective service of process for
any suit, action or other proceeding brought in any such court. The parties irrevocably and
unconditionally waive any objection to the laying of venue of any suit, action or other proceeding
in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim
in any such court that any such suit, action or other proceeding brought in any such court has been
brought in an inconvenient forum.
34
Section 19. General Provisions. This Agreement constitutes the entire agreement of the
parties to this Agreement and supersedes all prior written or oral and all contemporaneous oral
agreements, understandings and negotiations with respect to the subject matter hereof. This
Agreement may be executed in two or more counterparts, each one of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same instrument. This
Agreement may not be amended or modified unless in writing by all of the parties hereto, and no
condition herein (express or implied) may be waived unless waived in writing by each party whom the
condition is meant to benefit. The Table of Contents and the Section headings herein are for the
convenience of the parties only and shall not affect the construction or interpretation of this
Agreement.
Each of the parties hereto acknowledges that it is a sophisticated business person who was
adequately represented by counsel during negotiations regarding the provisions hereof, including,
without limitation, the indemnification provisions of Section 9 and the contribution provisions of
Section 10, and is fully informed regarding said provisions. Each of the parties hereto further
acknowledges that the provisions of Sections 9 and 10 hereto fairly allocate the risks in light of
the ability of the parties to investigate the Company, its affairs and its business in order to
assure that adequate disclosure has been made in the Registration Statement, any Preliminary
Prospectus, the Time of Sale Prospectus, each free writing prospectus and the Prospectus (and any
amendments and supplements thereto), as required by the Securities Act and the Exchange Act.
[Signature page follows.]
35
If the foregoing is in accordance with your understanding of our agreement, kindly sign and
return to the Company the enclosed copies hereof, whereupon this instrument, along with all
counterparts hereof, shall become a binding agreement in accordance with its terms.
Very truly yours, Energy West, Incorporated |
||||
By: | ||||
Name: | ||||
Title: | ||||
The foregoing Underwriting Agreement is hereby confirmed and accepted by each of the
Underwriters as of the date first above written.
Xxxxxx, Xxxxx Xxxxx, Incorporated |
||||
By: | ||||
Name: | ||||
Title: | ||||
Ladenburg Xxxxxxxx & Co. Inc. |
||||
By: | ||||
Name: | ||||
Title: | ||||
Signature page to Underwriting Agreement
SCHEDULE A
Number of Firm | ||||
Shares to be | ||||
Underwriters | Purchased | |||
Xxxxxx, Xxxxx Xxxxx, Incorporates |
[__________] | |||
Ladenburg Xxxxxxxx & Co. Inc. |
[__________] |
SCHEDULE B
1. The following pricing term sheet:
Filed Pursuant to Rule 433
Issuer Free Writing Prospectus dated April ___, 2008
Relating to Preliminary Prospectus dated April ___, 2008
Issuer Free Writing Prospectus dated April ___, 2008
Relating to Preliminary Prospectus dated April ___, 2008
Registration No. 333-149668
2,250,000 Shares
Energy West, Incorporated
Common Stock
ISSUER FREE WRITING PROSPECTUS
Energy West, Incorporated
Common Stock
ISSUER FREE WRITING PROSPECTUS
Issuer:
|
Energy West, Incorporated | |
Ticker / Exchange:
|
EWST/ Nasdaq Stock Market, LLC | |
Offering size:
|
2,250,000 Firm Shares or, if the Underwriter exercises in full its option to purchase additional Shares, 337,500 Shares | |
Public offering price:
|
$ per share | |
Price to EWST:
|
$ per share | |
Net proceeds to EWST:
|
We will receive net proceeds of approximately $ million from our sale of 2,250,000 shares of common stock in this offering, after deducting the underwriting discount and estimated offering expenses payable by us. | |
Use of Proceeds:
|
Acquisitions and general corporate purposes. |
Trade date:
|
April ___, 2008 | |
Settlement date:
|
April ___, 2008 | |
Underwriters:
|
Xxxxxx, Xxxxx Xxxxx, Incorporated Ladenburg Xxxxxxxx & Co. Inc. |
THE ISSUER HAS FILED A REGISTRATION STATEMENT (INCLUDING A PROSPECTUS) WITH THE SEC FOR THE
OFFERING TO WHICH THIS COMMUNICATION RELATES. BEFORE YOU INVEST, YOU SHOULD READ THE PROSPECTUS IN
THAT REGISTRATION STATEMENT AND OTHER DOCUMENTS THE ISSUER HAS FILED WITH THE SEC FOR MORE COMPLETE
INFORMATION ABOUT THE ISSUER AND THIS OFFERING. YOU MAY GET THESE DOCUMENTS FOR FREE BY VISITING
XXXXX ON THE SEC WEB SITE AT XXX.XXX.XXX. ALTERNATIVELY, THE ISSUER, UNDERWRITER OR ANY DEALER
PARTICIPATING IN THE OFFERING WILL ARRANGE TO SEND YOU THE PROSPECTUS IF YOU REQUEST IT BY CALLING
.
SCHEDULE C
SUBSIDIARIES
Energy West Resources, Inc., a Montana corporation
Energy West Development, Inc., a Montana corporation
Frontier Natural Gas Company, LLC, a North Carolina limited liability company
Frontier Utilities of North Carolina, Inc., a North Carolina corporation
Energy West Development, Inc., a Montana corporation
Frontier Natural Gas Company, LLC, a North Carolina limited liability company
Frontier Utilities of North Carolina, Inc., a North Carolina corporation