1
EXHIBIT 1.1
ROCKWELL MEDICAL TECHNOLOGIES, INC.
UNDERWRITING AGREEMENT
New York, New York
Dated: , 1998
X.X. XXXXXXX & CO., INC.
Xxx Xxxxxxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
XXXXX XXXX & CO., INC.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen:
The undersigned, ROCKWELL MEDICAL TECHNOLOGIES, INC., a Michigan
corporation (the "Company"), proposes to issue and sell to Xxxxx Xxxx & Co.,
Inc. ("Xxxxx Xxxx" or the "Representative") and X.X. Xxxxxxx & Co., Inc.
("X.X.") severally and not jointly (Xxxxx Xxxx and X.X. are collectively
referred to as the "Underwriters") pursuant to this Underwriting Agreement
("Agreement"), an aggregate of 1,800,000 shares of the Company's Common Stock
(the "Common Stock") at $4.00 per share and 2,700,000 warrants (the "Warrants")
to purchase shares of Common Stock at $.10 per Warrant. The Warrants are
exercisable to purchase one share of Common Stock, at any time commencing one
year from the date on which the Registration Statement (as defined in Section
1(a) hereof), shall have become or been declared effective (the "Effective
Date"), and ending on the fourth anniversary of the Effective Date. The
Warrant exercise price, subject to adjustment as described in the agreement
providing for the Warrants (the "Warrant Agreement"), shall be $4.50 per share,
subject to adjustment as described in the Warrant Agreement.
The shares of Common Stock and the Warrants will be separately
transferable
2
immediately upon issuance. Commencing one year after the Effective Date,
the Warrants are subject to redemption by the Company at $0.10 per Warrant,
provided that (a) prior notice of not less than 30 days is given to the holders
of the Warrants (the "Warrantholders"), and (b) the closing bid price per share
of Common Stock, if traded on The NASDAQ Stock Market, or the last sale price
per share of Common Stock, if traded on a national exchange, for the 20
consecutive trading days ending on the third day prior to the date on which
notice of redemption is given, is in excess of $7.00.
In addition, the Company proposes to grant to the Underwriters the
Over-Allotment Option (as defined in Section 2(c) hereof) to purchase all or
any part of an aggregate of 270,000 shares of Common Stock and 405,000
Warrants, and to issue to you the Underwriters' Warrant (as defined in Section
11 hereof) to purchase certain further additional shares of Common Stock and
Warrants.
The aggregate of 1,800,000 shares of Common Stock to be sold by the
Company, together with the aggregate of 270,000 additional shares of Common
Stock that are the subject of the Over-allotment Option, are herein
collectively called the "Shares." The Shares and the Warrants (including the
Warrants subject to the Over-Allotment Option and the Warrants issuable upon
exercise of the Underwriters' Warrant), the shares of Common Stock issuable
upon exercise of the Warrants and the shares of Common Stock issuable upon
exercise of the Underwriters' Warrant, are herein collectively called the
"Securities." The term "Underwriters' Counsel" shall mean the firm of Xxxxxxx,
Savage, Kaplowitz, & Xxxxxxxxxx, LLP, counsel to the Underwriters, and the term
"Company Counsel" shall mean the firm of Xxxxxxxx Xxxxxx Xxxxxxxx and Xxxx,
counsel to the Company. Unless the context otherwise requires, all references
herein to a "Section" shall mean the appropriate Section of this Agreement.
You have advised the Company that you desire to purchase the shares of
Common Stock and the Warrants as herein provided. The Company confirms the
agreements made by it with respect to the purchase of the shares of Common
Stock and the Warrants by you, as follows:
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to, and agrees with, the Underwriters that:
(a) REGISTRATION STATEMENT; PROSPECTUS; A registration
statement (File No. 333-31991) on Form SB-2 relating to the public offering
of the Securities (the "Offering"), including a preliminary form of prospectus,
copies of which have heretofore been delivered to you, has been prepared by the
Company in conformity in all material respects with the requirements of the
Securities Act of 1933 (the "Act"), and the rules and regulations of the
Securities and Exchange Commission (the "Commission") promulgated thereunder
(the "Rules and Regulations"), and has been filed with the Commission under the
Act. As used herein, the term "Preliminary Prospectus" shall mean each
prospectus filed pursuant to Rule 430 or Rule 424(a) of the Rules and
Regulations. The Preliminary Prospectus bore the legend required by Item 501
of Regulation S-B under the Act and the Rules and Regulations. Such
registration statement
2
3
(including all financial statements, schedules and exhibits) as amended
at the time it becomes effective and the final prospectus included therein are
herein respectively called the "Registration Statement" and the "Prospectus,"
except that (i) if the prospectus filed by the Company pursuant to Rule 424(b)
or Rule 430A of the Rules and Regulations shall differ from such final
prospectus as then amended, then the term "Prospectus" shall instead mean the
prospectus first filed pursuant to said Rule 424(b) or Rule 430A, and (ii) if
such registration statement is amended or such prospectus is amended or
supplemented after the effective date of such registration statement and prior
to the Option Closing Date (as defined in Section 2(c) hereof), then (unless
the context necessarily requires otherwise) the term "Registration Statement"
shall include such registration statement as so amended, and the term
"Prospectus" shall include such prospectus as so amended or supplemented, as
the case may be.
(b) CONTENTS OF REGISTRATION STATEMENT. On the Effective
Date, and at all times subsequent thereto for so long as the delivery of
a prospectus is required in connection with the offering or sale of any of the
Securities, (i) the Registration Statement and the Prospectus shall in all
material respects conform to the requirements of the Act and the Rules and
Regulations, and (ii) neither the Registration Statement nor the Prospectus
shall include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary or make statements
therein in light of the circumstances in which they were made, not misleading;
provided, however, that the Company makes no representations, warranties or
agreements as to information contained in or omitted from the Registration
Statement or Prospectus in reliance upon, and in conformity with, written
information furnished to the Company by or on behalf of the Underwriters
specifically for use in the preparation thereof. It is understood that the
statements set forth in the Prospectus with respect to stabilization, the
material set forth under the caption "UNDERWRITING," the information on the
cover page of the Prospectus regarding the underwriting arrangements and the
identity of the Underwriters' Counsel under the caption "LEGAL MATTERS," which
information the Underwriters hereby represents and warrants to the Company is
true and correct in all material respects and does not omit to state any
material fact required to be stated therein or necessary to make statements
therein, in light of the circumstances in which they were made, not misleading,
constitute the only information furnished in writing by or on behalf of the
Underwriters for inclusion in the Registration Statement and Prospectus, as the
case may be.
Except for the registration rights granted under the Underwriters'
Warrant, or as disclosed in the Prospectus, no holders of any securities of the
Company or of any options, warrants or convertible or exchangeable securities
of the Company exercisable for or convertible or exchangeable for securities of
the Company, have the right to include any securities issued by the Company in
the Registration Statement or any registration statement to be filed by the
Company.
(c) ORGANIZATION, STANDING, ETC. The Company and Rockwell
Transportation, Inc., the Company's wholly-owned subsidiary (the "Subsidiary"),
are each duly incorporated and validly exist as corporations in good standing
under the laws of their respective
3
4
jurisdictions of incorporation, with full power and corporate authority to
own their properties and conduct their business as described in the Prospectus,
and are duly qualified or licensed to do business as foreign corporations and
are in good standing in each other jurisdiction in which the nature of their
business or the character or location of their properties requires such
qualification, except where failure so to qualify will not have a material
adverse effect on the business, properties or financial condition of the Company
and the Subsidiary, taken as a whole.
(d) CAPITALIZATION. The authorized, issued and
outstanding capital stock of the Company as of the date of the Prospectus is
as set forth in the Prospectus under the caption "CAPITALIZATION". The shares
of Common Stock issued and outstanding on the Effective Date have been duly
authorized, validly issued and are fully paid and non-assessable. No options,
warrants or other rights to purchase, agreements or other obligations to issue,
or agreements or other rights to convert any obligation into, any shares of
capital stock of the Company or the Subsidiary have been granted or entered into
by the Company or the Subsidiary, except as expressly described in the
Prospectus. The Securities conform in all material respects to all statements
relating thereto contained in the Registration Statement or the Prospectus.
(e) SECURITIES. The Securities conform, or will conform
when issued, in all material respects to all statements with respect thereto
contained in the Registration Statement and the Prospectus. The Securities have
been duly authorized and, when issued and delivered against payment therefor
pursuant to this Agreement, the Warrant Agreement or the Underwriters' Unit
Purchase Option, as the case may be, will be duly authorized, validly issued,
fully paid and non-assessable and free of preemptive rights of any security
holder of the Company. Neither the filing of the Registration Statement nor the
offering or sale of any of the Securities as contemplated by this Agreement
gives rise to any rights, other than those which have been waived or satisfied,
for or relating to the registration of any securities of the Company, except as
described in the Registration Statement or the Prospectus.
(f) AUTHORITY, ETC. This Agreement, the Warrant Agreement,
the Underwriters' Warrant Agreement, and the Financial Consulting
Agreement (as hereinafter defined), have been duly and validly authorized,
executed and delivered by the Company and, assuming due execution of this
Agreement and such other agreements by the other party or parties hereto and
thereto, constitute valid and binding obligations of the Company enforceable
against the Company in accordance with their respective terms, except as may be
limited by bankruptcy, reorganization, insolvency, moratorium or other similar
laws relating to or affecting the enforcement of creditors' rights generally,
and subject to general principles of equity, regardless of whether considered in
a proceeding at law or in equity, and except for the indemnity and contribution
provisions contained in this Agreement. The Company has full corporate power
and authority to authorize, issue and sell the Securities and the Underwriters'
Warrant on the terms and conditions set forth herein. All consents, approvals,
authorizations and orders of any court or governmental authority which are
required in connection with the authorization, execution and delivery of such
agreements, the authorization, issue and sale of the Securities and the
Underwriters' Warrant, and the consummation of the transactions contemplated
hereby have been
4
5
obtained, except such as may be required under the Act, the Securities Exchange
Act of 1934, as amended, the rules of the National Association of Securities
Dealers, Inc. or state securities laws.
(g) NO CONFLICT. The consummation of the transactions
hereby contemplated and fulfillment of the terms of this Agreement will not
conflict with or result in a breach of, any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any lien,
charge or encumbrance pursuant to the terms of, any contract, indenture,
mortgage, deed of trust, loan agreement or other material agreement or
instrument to which the Company or the Subsidiary is a party or by which the
Company or the Subsidiary may be bound or to which any of the property or assets
of the Company or the Subsidiary are subject, nor will such action result in any
violation of the provisions of the Articles of Incorporation or the By-laws of
the Company, or the articles of incorporation or by-laws of the Subsidiary, or
any statute, order, rule or regulation applicable to the Company or the
Subsidiary, or of any court or of any regulatory authority or other governmental
body having jurisdiction over the Company or the Subsidiary.
(h) ASSETS. Subject to the qualifications stated in the
Prospectus: (i) the Company and the Subsidiary, as the case may be, has good
and marketable title to all properties and assets described in the Prospectus as
owned by it, free and clear of all liens, charges, encumbrances or title
restrictions, except such as do not materially affect the value of such
properties or assets and do not materially interfere with the use made or
proposed to be made of such assets or properties by the Company or the
Subsidiary or are not materially significant or important in relation to the
business of the Company or the Subsidiary, as the case may be; and (ii) all of
the material leases and subleases under which the Company or the Subsidiary is
the lessor or sublessor of properties or assets or under which the Company or
the Subsidiary hold properties or assets as lessee or sublessee, as described in
the Prospectus, are in full force and effect and, except for the non-payment of
lease payments for periods not to exceed 60 days beyond the applicable due date
or as described in the Prospectus, neither the Company nor the Subsidiary is in
default in any material respect with respect to any of the material terms or
provisions of any of such leases or subleases, and no claim has been asserted by
any party adverse to the rights of the Company or the Subsidiary as lessor,
sublessor, lessee or sublessee under any such lease or sublease, or affecting or
questioning the right of the Company or the Subsidiary to continued possession
of the leased or subleased premises or assets under any such lease or sublease,
except as described or referred to in the Prospectus.
The outstanding debt, the property and the business of the Company
conforms in all material respects to the descriptions thereof contained in the
Registration Statement and Prospectus.
(i) INDEPENDENT ACCOUNTANTS. Coopers & Xxxxxxx, L.L.P.,
who have given their report on certain financial statements filed or to be
filed with the Commission as a part of the Registration Statement, and which are
included in the Prospectus, are with respect to the Company, independent public
accountants as required by the Act and the Rules and Regulations.
5
6
(j) FINANCIAL STATEMENTS. The consolidated financial
statements, together with related notes, set forth in the Registration Statement
and the Prospectus present fairly the consolidated financial position, results
of operations, changes in stockholders' equity and cash flows of the Company and
the Subsidiary on the basis stated in the Registration Statement, at the
respective dates and for the respective periods to which they apply, subject, in
the covered interim statements, to year-end adjustments and the lack of complete
interim footnotes. Such financial statements and related notes have been
prepared in accordance with generally accepted accounting principles applied on
a consistent basis throughout the entire period involved, except to the extent
disclosed therein and, with respect to the interim statements, subject to
year-end adjustments and the lack of complete interim footnotes.
(k) NO MATERIAL CHANGE. Except as otherwise set forth in
the Prospectus, subsequent to the date of the latest financial statements
included in the Prospectus, neither the Company nor the Subsidiary has: (i)
incurred any liability or obligation, direct or contingent, or entered into any
transaction, which is material to its business; (ii) effected or experienced
any change in its capital stock or incurred any long-term debt; (iii) issued
any options, warrants or other rights to acquire its capital stock; (iv)
declared, paid or made any dividend or distribution of any kind on its capital
stock; or (v) effected or experienced any material adverse change, or
development involving a known prospective material adverse change, in its
financial position, net worth, results of operations, business or business
prospects, assets or properties.
(l) LITIGATION. Except as set forth in the Prospectus,
there is not now pending any action, suit or proceeding (including any
related to environmental matters or discrimination on the basis of age, sex,
religion or race), whether or not in the ordinary course of business, to which
the Company or the Subsidiary is a party or its business or property is subject,
before or by any court or governmental authority, which, if determined adversely
to the Company or the Subsidiary, would have a material adverse effect on the
financial position, net worth, or results of operations, business or business
prospects, assets or property of the Company and the Subsidiary, taken as a
whole; and no labor disputes involving the employees of the Company or the
Subsidiary exist which would affect materially adversely the business, property,
financial position or results of operations of the Company and the Subsidiary,
taken as a whole.
(m) EMPLOYEE AND INDEPENDENT CONTRACTOR MATTERS.
The Company and the Subsidiary have generally enjoyed satisfactory
employer/employee relationships with their respective employees and are in
compliance in all material respects with all Federal, state and local laws and
regulations, including but not limited to, applicable tax laws and
regulations, respecting the employment of their respective employees and
employment practices, terms and conditions of employment and wages and hours
relating thereto, except where failure to so comply would not reasonably be
expected to effect materially adversely the business, property, financial
position or results of operations of the Company and the Subsidiary taken as a
whole. To the knowledge of the Company or the Subsidiary, there are no pending
investigations involving the Company or the Subsidiary by the U.S. Department
of Labor or corresponding foreign agency, or any other governmental agency
responsible for the enforcement of such Federal, state or local laws and
6
7
regulations. To the knowledge of the Company or the Subsidiary, there are no
unfair labor practice charges or complaints against the Company or the
Subsidiary pending before the National Labor Relations Board or corresponding
foreign agency or, to the knowledge of the Company and the Subsidiary, any
strikes, picketing, boycotts, slowdowns or stoppages pending against the
Company or the Subsidiary, and none has occurred. No representation question
exists respecting the employees of the Company or the Subsidiary. No
collective bargaining agreements or modifications thereof are currently in
effect or being negotiated by the Company or the Subsidiary and their
respective employees. No grievance or arbitration proceeding is pending under
any expired or existing collective bargaining agreements of the Company or the
Subsidiary.
Neither the Company nor the Subsidiary: (i) maintain nor have maintained,
sponsored or contributed to any program or arrangement that is an "employee
pension benefit plan," an "employee welfare benefit plan" or a "multi-employer
plan" as such terms are defined in Sections 3(2), 3(1) and 3(37), respectively
of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
except for the Stock Option Plan described in the Prospectus; (ii) presently
maintain or contribute nor at any time in the past, have they maintained or
contributed to a defined benefit plan, as defined in Section 3(35) of ERISA; or
(iii) has ever completely or partially withdrawn from a "multi-employer plan."
(n) NO UNLAWFUL PROSPECTUSES. The Company has not
distributed any prospectus or other offering material in connection with
the Offering contemplated herein, other than any Preliminary Prospectus, the
Prospectus or other material permitted by the Act and the Rules and Regulations.
(o) TAXES. Except as disclosed in the Prospectus, the
Company and the Subsidiary have filed all necessary federal, state, local and
foreign income and franchise tax returns and has paid all taxes shown as due
thereon on or before the date such taxes are due to be paid, except where the
failure to file such tax returns or pay such taxes would not reasonably be
expected to have a material adverse effect on the financial position, net worth,
results of operations, business or business prospects, assets or properties of
the Company and the Subsidiary, taken as a whole; and there is no tax deficiency
which has been asserted against the Company or the Subsidiary.
(p) LICENSES, ETC. The Company and the Subsidiary have in
effect allnecessary licenses, permits and other governmental authorizations
currently required for the conduct of its business or the ownership of its
property, as described in the Prospectus, and is in all material respects in
compliance therewith. To the knowledge of the Company, none of the activities
or business of the Company or the Subsidiary is in violation of, or would cause
the Company or the Subsidiary to violate, any law, rule, regulation or order of
the United States, any country, state, county or locality, the violation of
which would have a material adverse effect upon the financial position, net
worth, results of operations, business or business prospects, assets or
property of the Company and the Subsidiary, taken as a whole.
7
8
(q) NO PROHIBITED PAYMENTS. Neither the Company, the
Subsidiary, nor, to the knowledge of the Company or the Subsidiary, any of their
respective employees or officers or directors, agents or any other person acting
at the direction of the Company or the Subsidiary has, directly or indirectly,
contributed or agreed to contribute any money, gift or similar benefit (other
than legal price concessions to customers in the ordinary course of business) to
any customer, supplier, employee or agent of a customer, supplier, or official
or governmental agency or instrumentality of any government (domestic or
foreign) or any political party or candidate for office (domestic or foreign) or
other person who was, is, or may be in a position to help or hinder the business
of the Company or the Subsidiary (or assist it in connection with any actual or
proposed transaction) which (i) could reasonably be expected to subject the
Company or the Subsidiary to any material damage or penalty in any civil,
criminal or governmental litigation or proceeding, (ii) if not given in the
past, could reasonably be expected to have had a materially adverse effect on
the assets, business or operations of the Company or the Subsidiary as reflected
in any of the financial statements contained in the Prospectus, or (iii) if not
continued in the future, could reasonably be expected to materially adversely
affect the assets, business, operations or prospects of the Company or the
Subsidiary. The Company's internal accounting controls and procedures are
sufficient to cause the Company to comply in all material respects with the
Foreign Corrupt Practices Act of 1977, as amended.
(r) TRANSFER TAXES. On the Closing Dates (as defined in
Section 2(d) hereof), all transfer and other taxes (including franchise,
capital stock and other taxes, other than income taxes, imposed by any
jurisdiction), if any, which are required to be paid in connection with the sale
and transfer of the Securities to the Underwriters hereunder shall have been
fully paid or provided for by the Company, and all laws imposing such taxes
shall have been fully complied with.
(s) EXHIBITS. All contracts and other documents of the
Company or the Subsidiary described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement, have been
described in the Registration Statement or the Prospectus or filed with the
Commission, as required under the Rules and Regulations.
(t) SUBSIDIARIES. Rockwell Medical Transportation, Inc.
is the Company's only subsidiary and is wholly-owned by the Company.
(u) SHAREHOLDER AGREEMENTS, REGISTRATION RIGHTS. Except
as described in the Prospectus, no security holder of the Company has any
rights with respect to the purchase, sale or registration of any Securities, and
all registration rights with respect to the Offering have been waived.
(v) NO STABILIZATION OR MANIPULATION. Neither the Company
nor, to the Company's knowledge, any of its officers or directors or any of
its employees or stockholders, have taken and will 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, under the Exchange
8
9
Act or otherwise, the stabilization or manipulation of the price of the Common
Stock to facilitate the sale or resale of the Securities.
(w) NO FINDERS. Except as described in the Prospectus and
amounts previously paid to Maidstone Financial, Inc., to the knowledge of
the Company or the Subsidiary, there are no claims, payments, issuances,
arrangements or understandings for services in the nature of a finder's or
origination fee with respect to the sale of the Securities hereunder or any
other arrangements, agreements, understandings, commitments, payments or
issuances of securities with respect to the Company that may affect the
Underwriters' compensation, as determined by the National Association of
Securities Dealers, Inc. ("NASD").
(x) Intentionally left blank.
(y) Intentionally left blank.
(aa) NO ADVERSE EFFECT OF TRANSACTION CONTEMPLATED HEREBY.
Neither the completion of the Offering nor any of the transactions
contemplated herein or in the Prospectus, including but not limited to the
issuance of any of the Securities, will result in a "change of control" or the
loss of, or have any adverse effect on, the maintenance in good standing of the
Company's licenses.
2. PURCHASE, DELIVERY AND SALE OF SECURITIES
(a) PURCHASE PRICE FOR SECURITIES. The Securities shall be
sold to and purchased by the Underwriters at the purchase price of $3.64 per
share of Common Stock and $.091 per Warrant (that being the public offering
price of $4.00 per share of Common Stock and $.10 per Warrant less an
underwriting discount of 9 percent) (the "Purchase Price").
(b) FIRM SECURITIES.
(i) Subject to the terms and conditions of this
Agreement, and on the basis of the representations, warranties and agreements
herein contained, the Company agrees to issue and sell to the Underwriters, and
the Underwriters, agrees to buy from the Company at the Purchase Price the
Common Stock and the Warrants (the "Firm Securities").
(ii) Delivery of the Firm Securities against payment
therefor shall take place at the offices of Xxxxx Xxxx & Co., Inc., 000
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (or at such other place as may be
designated by agreement between you and the Company) at 10:00 a.m., New York
Time, on , 1998, or at such later time and date, not later than three
business days after the Effective Date, as you may designate (such time and
date of payment and delivery for the Firm Securities being herein called the
"First Closing Date"). Time shall be of the essence and delivery of the Firm
Securities at the time and place specified in this Section 2(b)(ii) is a
further condition to the obligations of the Underwriters hereunder.
9
10
(c) OPTION SECURITIES.
(i) In addition, subject to the terms and conditions
of this Agreement, and on the basis of the representations, warranties and
agreements herein contained, the Company hereby grants to Xxxxx Xxxx an option
(the "Over-Allotment Option"), to purchase from the Company all or any part of
an additional 270,000 shares of Common Stock and/or 405,000 Warrants at the
Purchase Price (the "Option Securities").
(ii) Subject to the terms and conditions of this
Agreement, the Over-Allotment Option may be exercised by Xxxxx Xxxx, in whole
or in part, within forty-five days after the Effective Date, upon written
notice by Xxxxx Xxxx to the Company advising it of the number of Option
Securities as to which the Over-Allotment Option is being exercised, the names
and denominations in which the certificates for the Shares and the Warrants are
to be registered, and the time and date when such certificates are to be
delivered. Such time and date shall be determined by you but shall not be less
than two nor more than ten business days after exercise of the Over-Allotment
Option, nor in any event prior to the First Closing Date (such time and date
being herein called the "Option Closing Date"). Delivery of the Option
Securities against payment therefor shall take place at Xxxxx Xxxx'x offices.
Time shall be of the essence and delivery at the time and place specified in
this Section 2(c)(ii) is a further condition to the obligations of the
Underwriters hereunder.
(iii) The Over-Allotment may be exercised only to
cover over-allotments in the sale by the Underwriters of Firm Securities.
(d) DELIVERY OF CERTIFICATES; PAYMENT.
(i) The Company shall make the certificates for the
Shares and the Warrants to be purchased hereunder available to you for
checking at least two full business days prior to the First Closing Date or the
Option Closing Date (each, a "Closing Date"), as the case may be. The
certificates shall be in such names and denominations as you may request at
least two business days prior to the relevant Closing Date. Time shall be of
the essence and the availability of the certificates at the time and place
specified in this Section 2(d)(i) is a further condition to the obligations of
the Underwriters hereunder.
(ii) On the First Closing Date the Company shall
deliver to you for the account of the Underwriters definitive engraved
certificates in negotiable form representing all of the Shares and the Warrants
to be sold by the Company, against payment of the Purchase Price therefor by
you for the several account of the Underwriters, by certified or bank cashier's
checks payable in New York Clearing House (next day) funds to the order of the
Company.
(iii) In addition, if and to the extent that Xxxxx
Xxxx exercises the Over-Allotment Option, then on the Option Closing Date
the Company shall deliver to you for the account of Xxxxx Xxxx or its designees
definitive engraved certificates in negotiable form
10
11
representing the Shares and the Warrants to be sold by the Company, against
payment of the Purchase Price therefor by Xxxxx Xxxx for the account of Xxxxx
Xxxx or its designees, by certified or bank cashier's checks payable in New
York Clearing House (next day) funds to the order of the Company.
(iv) It is understood that the Underwriters propose to
offer the Shares and Warrants to be purchased hereunder to the public,
upon the terms and conditions set forth in the Registration Statement, after
the Registration Statement becomes effective.
3 COVENANTS OF THE COMPANY. The Company covenants and agrees with
the Underwriters that:
(a) REGISTRATION.
(i) The Company shall use its best efforts to cause the
Registration Statement to become effective and, upon notification from the
Commission that the Registration Statement has become effective, shall so
advise you and shall not at any time, whether before or after the Effective
Date, file any amendment to the Registration Statement or any amendment or
supplement to the Prospectus of which you shall not previously have been
advised and furnished with a copy, or to which you or Underwriters' Counsel
shall have reasonably objected in writing, or which is not in compliance in all
material respects with the Act and the Rules and Regulations.
(ii) Promptly after you or the Company shall have been
advised thereof, you shall advise the Company or the Company shall advise
you, as the case may be, and confirm such advice in writing, of (A) the receipt
of any comments of the Commission, (B) the effectiveness of any post-effective
amendment to the Registration Statement, (C) the filing of any supplement to
the Prospectus or any amended Prospectus, (D) any request made by the
Commission for amendment of the Registration Statement or amendment or
supplementing of the Prospectus, or for additional information with respect
thereto, or (E) the issuance by the Commission or any state or regulatory body
of any stop order or other order denying or suspending the effectiveness of
the Registration Statement, or preventing or suspending the use of any
Preliminary Prospectus, or suspending the qualification of the Securities for
offering in any jurisdiction, or otherwise preventing or impairing the
Offering, or the institution or threat of any proceeding for any of such
purposes. The Company and you shall not acquiesce in such order or proceeding,
and shall instead actively defend such order or proceeding, unless the Company
and you agree in writing to such acquiescence.
(iii) The Company has caused to be delivered to you
copies of each Preliminary Prospectus, and the Company has consented and
hereby consents to the use of such copies for the purposes permitted by the
Act. The Company authorizes the Underwriters and selected dealers to use the
Prospectus in connection with the sale of the Shares and Warrants for such
period as in the opinion of Underwriters' Counsel the use thereof is required
to comply with
11
12
the applicable provisions of the Act and the Rules and Regulations. In
case of the happening, at any time within such period as the Prospectus is
required under the Act to be delivered in connection with sales by an
Underwriters or dealer of securities, of any event of which the Company has
knowledge and which materially affects the Company or the Securities, or which
in the opinion of Company Counsel or of Underwriters' Counsel should be set
forth in an amendment to the Registration Statement or an amendment or
supplement to the Prospectus in order to make the statement made therein not
then misleading, in light of the circumstances existing at the time the
Prospectus is required to be delivered to a purchaser of the Shares and
Warrants, or in case it shall be necessary to amend or supplement the
Prospectus to comply with the Act or the Rules and Regulations, the Company
shall notify you promptly and forthwith prepare and furnish to the Underwriters
copies of such amended Prospectus or of such supplement to be attached to the
Prospectus, in such quantities as you may reasonably request, in order that the
Prospectus, as so amended or supplemented, shall not contain any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements in the Prospectus, in the light of the
circumstances under which they are made, not misleading. The preparation and
furnishing of each such amendment to the Registration Statement, amended
Prospectus or supplement to be attached to the Prospectus shall be without
expense to the Underwriters, except that in the case that the Underwriters are
required, in connection with the sale of the shares of Common Stock and
Warrants, to deliver a prospectus nine months or more after the Effective Date,
the Company shall upon your request and at the expense of the Underwriters,
amend the Registration Statement and amend or supplement the Prospectus, or
file a new registration statement, if necessary, and furnish the Underwriters
with reasonable quantities of prospectuses complying with section 10(a)(3) of
the Act.
(iv) The Company will deliver to you at or before the
First Closing Date two signed copies of the Registration Statement
including all financial statements and exhibits filed therewith and not
incorporated by reference, and of all amendments thereto. The Company will
deliver to or upon your order, from time to time until the Effective Date as
many copies of any Preliminary Prospectus filed with the Commission prior to
the Effective Date as the Underwriters may reasonably request. The Company
will deliver to you on the Effective Date and thereafter for so long as a
Prospectus is required to be delivered under the Act, from time to time,
as many copies of the Prospectus, in final form, or as thereafter amended or
supplemented, as the Underwriters may from time to time reasonably request.
(v) The Company shall comply with the Act, the Rules and
Regulations, and the Securities Exchange Act of 1934 (the "Exchange Act"),
and the rules and regulations promulgated thereunder in connection with the
offering and issuance of the Securities in all material respects.
(b) BLUE SKY. The Company shall, at its own expense,
cooperate with the Underwriterss and Underwriters' Counsel to qualify or
register the Securities for sale (or obtain an exemption from registration)
under the securities or "blue sky" laws of such jurisdictions as you may
reasonably designate, and shall complete such applications and furnish such
12
13
information to Underwriters' Counsel as may be required for that purpose, and
shall comply in all material respects with such laws; provided, however, that
the Company shall not be required to qualify as a foreign corporation or a
dealer in securities or to execute a general consent to service of process in
any jurisdiction in any action other than one arising out of the offering or
sale of the Shares and Warrants. The Company shall bear all of the expense of
such qualifications and registrations, including without limitation the legal
fees and disbursements of Underwriters' Counsel, which fees, exclusive of
disbursements, shall not exceed $35,000 (unless otherwise agreed) of which
$10,000 has been paid. After each Closing Date the Company shall, at its own
expense, from time to time prepare and file such statements and reports as may
be required to continue each such qualification (or maintain such exemption from
registration) in effect for so long a period as required by law, regulation or
administrative policy in connection with the offering of the Securities.
(c) EXCHANGE ACT REGISTRATION. The Company shall at its own
expense, prepare and file with the Commission a registration statement
(on Form 8-A or Form 10) under section 12 of the Exchange Act, and shall use its
best efforts to cause such registration statement to be declared effective by
the Commission on an accelerated basis on the Effective Date and maintained in
effect for at least five years from the Effective Date.
(d) PROSPECTUS COPIES. The Company shall deliver to you on or
before the First Closing Date a copy of the Registration Statement
including all financial statements, schedules and exhibits filed therewith and
not incorporated by reference, and of all amendments thereto. The Company shall
deliver to or on the order of the Underwriters, from time to time until the
Effective Date, as many copies of any Preliminary Prospectus filed with the
Commission prior to the Effective Date as the Underwriters may reasonably
request. The Company shall deliver to the Underwriters on the Effective Date,
and thereafter for so long as a prospectus is required to be delivered under the
Act, from time to time, as many copies of the Prospectus, in final form, or as
thereafter amended or supplemented, as the Underwriters may from time to time
reasonably request.
(e) AMENDMENTS AND SUPPLEMENTS. The Company shall, promptly upon
your request, prepare and file with the Commission any amendments to the
Registration Statement, and any amendments or supplements to the Preliminary
Prospectus or the Prospectus, and take any other action which in the reasonable
opinion of Underwriters' Counsel and Company Counsel may be reasonably necessary
or advisable in connection with the distribution of the Securities, and shall
use its best efforts to cause the same to become effective as promptly as
possible.
(f) CERTAIN MARKET PRACTICES. The Company has not taken, and
shall not take, directly or indirectly, any action designed, or which might
reasonably be expected, to cause or result in, or which has constituted, the
stabilization or manipulation of the price of the Securities to facilitate the
sale or resale thereof.
(g) CERTAIN REPRESENTATIONS. Neither the Company nor any
13
14
representative of the Company has made or shall make any written or oral
representation in connection with the Offering and sale of the Securities or the
Underwriters' Warrant which is not contained in the Prospectus, which is
otherwise inconsistent with or in contravention of anything contained in the
Prospectus, or which shall constitute a violation of the Act, the Rules and
Regulations, the Exchange Act or the rules and regulations promulgated under the
Exchange Act.
(h) CONTINUING REGISTRATION OF WARRANTS AND UNDERLYING COMMON
STOCK. For so long as any Warrant is outstanding, the Company shall, at its
own expense: (i) use its reasonable best efforts to cause post-effective
amendments to the Registration Statement, or new registration statements
relating to the Warrants and the Common Stock underlying the Warrants to become
effective in compliance with the Act and without any lapse of time between the
effectiveness of the Registration Statement and of any such post-effective
amendment or new registration statement; provided, however, that the Company
shall have no obligation to maintain the effectiveness of such Registration
Statement or file a new Registration Statement, or to keep available a
prospectus at any time at which such registration or prospectus is not then
required; (ii) cause a copy of each Prospectus, as then amended, to be delivered
to each holder of record of a Warrant; (iii) furnish to the Underwriters and
dealers as many copies of each such Prospectus as the Underwriters or dealers
may reasonably request; and (iv) use its reasonable best efforts to maintain the
"blue sky" qualification or registration of the Warrants and the Common Stock
underlying the Warrants, or have a currently available exemption therefrom, in
each jurisdiction in which the Securities were so qualified or registered for
purposes of the Offering.
(i) USE OF PROCEEDS. The Company shall apply the net proceeds from
the sale of the shares of Common Stock and Warrants substantially for the
purposes set forth in the Prospectus under the caption "USE OF PROCEEDS," and
shall file such reports with the Commission with respect to the sale of the
shares of Common Stock and Warrants and the application of the proceeds
therefrom as may be required pursuant to Rule 463 of the Rules and Regulations.
(j) TWELVE MONTHS' EARNINGS STATEMENT. The Company shall make
generally available to its security holders and deliver to you as soon as
it is practicable so to do, but in no event later than ninety days after the end
of twelve months after the close of its current fiscal quarter, an earnings
statement (which need not be audited) covering a period of at least twelve
consecutive months beginning after the Effective Date, which shall satisfy the
requirements of section 11(a) of the Act.
(k) NASDAQ EXCHANGE LISTINGS, ETC. The Company shall
immediately make all filings required to seek approval for the quotation of
the Securities on the NASDAQ SmallCap Market ("NASDAQ") and shall use its best
efforts to effect and maintain such approval for at least five years
from the Effective Date. Within 10 days after the Effective Date, the
Company shall also use its best efforts to list itself, on an expedited basis,
in Xxxxx'x OTC Industrial Manual, Standard and Poor's Corporation Descriptions
or other recognized securities manuals acceptable to the Underwriters and to
cause such listing to be maintained for five years
14
15
from the Effective Date.
(l) BOARD OF DIRECTORS. For a period of three (3) years after the
First Closing Date, the Company shall nominate and use its reasonable best
efforts to engage a designee of Xxxxx Xxxx as a nonvoting advisor to the
Company's Board of Directors (the "Advisor") or, in lieu thereof, to designate
an individual for election as a director, in which case the Company shall use
its reasonable best efforts to have such individual elected as a director. The
designee may be a director, officer, partner, employee or affiliate of an
Underwriters, and Xxxxx Xxxx shall designate such person in writing to the
Board; provided, however, such person shall be reasonably satisfactory to the
Company. In the event Xxxxx Xxxx shall not have designated such individual at
the time of any meeting of the Board or such person is unavailable to serve, the
Company shall notify Xxxxx Xxxx of each meeting of the Board. An individual, if
any, designated by Xxxxx Xxxx shall receive all notices and other correspondence
and communications sent by the Company to members of the Board. Such Advisor
shall be entitled to receive reimbursement for all reasonable costs incurred in
attending such meetings including, but not limited to, food, lodging, and
transportation. In addition, such Advisor shall be entitled to the same
compensation as the Company gives to other non-employee directors for acting in
such capacity. The Company further agrees that, during said three (3) year
period, it shall schedule no less than four (4) formal and "in person" meetings
of its Board of Directors in each such year at which meetings such Advisor shall
be permitted to attend as set forth herein; said meetings shall be held
quarterly each year and thirty (30) days advance notice of such meetings shall
be given to the Advisor. Further, during such three (3) year period, the
Company shall give notice to Xxxxx Xxxx with respect to any proposed material
acquisitions, mergers, reorganizations or other similar transactions.
The Company agrees to indemnify and hold harmless the Underwriters and the
Advisor against any and all claims, actions, damages, costs and expenses, and
judgments arising solely out of the attendance and participation of the Advisor
at any such meeting described herein. In the event the Company maintains a
liability insurance policy affording coverage for the acts of its officers
and directors, it agrees, if possible and without undue additional expense, to
include the Advisor as an insured under such policy.
(m) PERIODIC REPORTS. For so long as the Company is a
reporting company under section 12(g) or section 15(d) of the Exchange Act, the
Company shall, at its own expense, hold an annual meeting of stockholders for
the election of directors within 180 days after the end of each of the Company's
fiscal years and, within 150 days after the end of each of the Company's fiscal
years, furnish to its stockholders an annual report (including financial
statements audited by certified public accountants) in reasonable detail. In
addition, during the period ending five years from the date hereof, the Company
shall, at its own expense, furnish to you: (i) within 90 days of the end of
each fiscal year, a balance sheet of the Company and the Subsidiary as at the
end of such fiscal year, together with statements of income, stockholders'
equity and cash flows of the Company and the Subsidiary as at the end of such
fiscal year, all in reasonable detail and accompanied by a copy of the
certificate or report thereon of certified public accountants; (ii) as soon as
they are available, a copy of all reports (financial or otherwise) distributed
to security
15
16
holders; (iii) as soon as they are available, a copy of all non-confidential
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.
The financial statements referred to herein shall be on a consolidated basis to
the extent the accounts of the Company and the Subsidiary are consolidated in
reports furnished to its stockholders generally.
(n) FORM S-8 REGISTRATIONS. For a period of two years
following the First Closing Date, the Company shall not, without Xxxxx
Xxxx'x prior written consent, register or otherwise facilitate the registration
of any of its securities issuable upon the exercise of options, warrants (other
than up to 450,000 options issued pursuant to the Company's Stock Option Plan,
the Warrants and the Underwriters' Warrant) or other rights, whether by means of
a Registration Statement on Form S-8 or otherwise.
(o) FUTURE SALES. For a period of two years following the
First Closing Date, the Company shall not, without Xxxxx Xxxx'x prior
written consent, sell or otherwise dispose of any securities of the Company,
including but not limited to the issuance of any Common Stock, and the granting
of any options or warrants (other than up to 450,000 options issued pursuant to
the Company's Stock Option Plan. Notwithstanding the foregoing, the Company may
at any time issue shares of Common Stock pursuant to the exercise of the
Warrants, the Underwriters' Warrant, the Warrants underlying the Underwriters'
Warrant and options, warrants or conversion rights issued and outstanding on the
Effective Date and described in the Prospectus.
(p) REGULATION S SALES. For a period of two years
following the First Closing Date, the Company shall not issue or sell any
securities pursuant to Regulation S of the Rules and Regulations under the Act,
without Xxxxx Xxxx'x prior written consent.
(q) AGREEMENTS WITH STOCKHOLDERS, DIRECTORS AND OFFICERS.
The Company shall cause each of the Company's existing stockholders,
directors and corporate officers to enter into written agreements with Xxxxx
Xxxx (the "Lock-up Agreements") prior to the Effective Date, that, for a period
of thirteen months from the Effective Date, they will not, without the consent
of Xxxxx Xxxx, (i) publicly sell any securities of the Company owned directly or
indirectly by them or owned beneficially by them (as defined in the Exchange
Act), or (ii) otherwise sell, or transfer such securities unless the transferee
agrees in writing to be bound by an identical lock-up.
(r) WARRANT SOLICITATION. Upon the exercise of any
Warrants on or after the first anniversary of the Effective Date, the
Company shall pay to Xxxxx Xxxx a commission of five (5%) percent of the
aggregate exercise price of such Warrants, if: (i) the market price of the
Common Stock is greater than the exercise price of the Warrant on the date of
exercise; (ii) the exercise of the Warrant was solicited by a member of the
NASD; (iii) the Warrant is not held in a discretionary account; (iv) the
disclosure of the compensation arrangements has been made in documents provided
to customers, both as part of the Offering and at the time of exercise; (v) the
solicitation of the Warrant was not in violation of Regulation M promulgated
under the Exchange Act; and (vi) you are designated in writing as the soliciting
NASD member. No commission shall
16
17
be paid to you on any Warrant exercise prior to the first anniversary of the
Effective Date, or on any Warrant exercised at any time without solicitation by
Xxxxx Xxxx or a soliciting dealer.
(s) AVAILABLE SHARES. The Company shall reserve and at all times
keep available that maximum number of it authorized but unissued shares of
Common Stock which are issuable upon exercise of options pursuant to the
Company's Stock Option Plan, the Warrants, the Underwriters' Warrant, and the
Warrants issuable upon exercise of the Underwriters' Warrant, in each case
taking into account the anti-dilution provisions thereof.
(t) FINANCIAL CONSULTING AGREEMENT. On the First Closing Date and
simultaneously with the delivery of the Firm Securities, the Company shall
execute and deliver to Xxxxx Xxxx an agreement with Xxxxx Xxxx, or its
representative, in the form previously delivered to the Company by Xxxxx Xxxx,
regarding the services of Xxxxx Xxxx or its representative a financial
consultant to the Company (the "Financial Consulting Agreement"), for a
twenty-four month period commencing as of the date hereof at a fee equal to
$5,208.34 per month which shall be paid in its entirety on the First Closing
Date.
(u) MANAGEMENT. On each Closing Date, the President of the Company
shall be Xxxxxx Xxxxxxx. Prior to the Effective Date, the Company shall
have obtained "key-employee" life insurance coverage in the amount of $1,000,000
on Xx. Xxxxxx. Prior to the Effective Date, the Company shall have entered into
an employment agreement with Xx. Xxxxxxx as set forth in the Registration
Statement.
(v) STOCK TRANSFER SHEETS. The Company shall instruct its
Transfer Agent (as defined in Section 4(h) hereto) to deliver to you copies
of all advice sheets showing the daily transfer of the outstanding shares of
Common Stock and Warrants sold by the Company in the public offering and shall,
at its own expense, furnish you weekly for the first six weeks following the
First Closing Date and monthly thereafter during the period ending three years
following the First Closing Date with Depository Trust Company stock transfer
sheets.
(w) PUBLIC RELATIONS. Prior to the Effective Date the Company
shall have retained a public relations firm reasonably acceptable to you,
and shall continue to retain such firm, or an alternate firm reasonably
acceptable to Xxxxx Xxxx, for a period of twelve (12) months following the
Effective Date.
(x) ADDITIONAL REPRESENTATIONS. The Company shall engage the
Underwriters' Counsel to provide the Underwriters, at the First Closing Date
and quarterly thereafter, until such time as the Common Stock is listed on the
New York Stock Exchange or the American Stock Exchange or quoted on NASDAQ
National Market System, with an opinion, setting forth those states in which the
Common Stock may be traded in non-issuer transactions under the blue sky laws of
the fifty states. The Company shall pay the Underwriters' Counsel a one-time
fee of $12,500 at the First Closing Date for such opinions.
17
18
(aa) BOUND VOLUMES. Within a reasonable time after the
First Closing Date, the Company shall deliver to you, at the Company's
expense, five bound volumes in form and content acceptable to Xxxxx Xxxx,
containing the Registration Statement and all exhibits filed therewith and all
amendments thereto, and all other agreements, correspondence, filings,
certificates and other documents filed and/or delivered in connection with the
Offering.
4 CONDITIONS TO UNDERWRITERS' OBLIGATIONS. The obligations
of the Underwriters to purchase and pay for the shares of Common Stock and
Warrants which you have agreed to purchase hereunder are subject to the
accuracy (as of the date hereof and as of each Closing Date) of and compliance
with the representations and warranties of the Company contained herein, the
performance by the Company of all of their respective obligations hereunder and
the following further conditions:
(a) EFFECTIVE REGISTRATION STATEMENT; NO STOP ORDER.
The Registration Statement shall have become effective and you shall have
received notice thereof not later than 6:00 p.m., New York time, on the date of
this Agreement, or at such later time or on such later date as to which you and
the Company may agree in writing. In addition, on each Closing Date (i) no stop
order denying or suspending the effectiveness of the Registration Statement
shall be in effect, and no proceedings for that or any similar purpose shall
have been instituted or shall be pending, and (ii) all requests on the part of
the Commission for additional information shall have been complied with to the
reasonable satisfaction of Underwriters' Counsel.
(b) OPINION OF COMPANY COUNSEL. On the First Closing
Date, you shall have received the opinion, dated as of the First Closing
Date, of Company Counsel, in form and substance satisfactory to the
Underwriters' Counsel.
(c) CORPORATE PROCEEDINGS. All corporate proceedings
and other legal matters relating to this Agreement, the Registration Statement,
the Prospectus and other related matters shall be reasonably satisfactory to or
approved by Underwriters' Counsel.
(d) COMFORT LETTER. Prior to the Effective Date, and
again on and as of the First Closing Date, you shall have received a letter
from Coopers & Xxxxxxx, certified public accountants for the Company,
satisfactory in form and substance to the Underwriters' Counsel.
(e) BRING DOWN. At each of the Closing Dates, (i)
the representations and warranties of the Company contained in this Agreement
shall be true and correct in all material respects with the same effect as if
made on and as of such Closing Date, and the Company shall have performed in all
material respects all of its obligations hereunder and satisfied all the
conditions to be satisfied at or prior to such Closing Date; (ii) the
Registration Statement and the Prospectus shall contain all statements which are
required to be stated therein in accordance with the Act and the Rules and
Regulations, and shall in all material respects conform to the requirements of
the Act and the Rules and Regulations, and neither the Registration Statement
nor the Prospectus shall contain any untrue statement of a material fact or omit
to state any material
18
19
fact required to be stated or which they were made, not misleading; (iii) there
shall have been, since the respective dates as of which information is given,
no material adverse change in the business, property, operations, condition
(financial or otherwise), earnings, capital stock, long-term or short-term debt
or general affairs of the Company from that set forth in the Registration
Statement and the Prospectus, except changes which the Registration Statement
and Prospectus indicate might occur after the Effective Date, and the Company
shall not have incurred any material liabilities nor entered into any material
agreement other than as referred to in the Registration Statement and
Prospectus; and (iv) except as set forth in the Prospectus, no action, suit or
proceeding shall be pending or threatened against the Company before or by any
commission, board or administrative agency in the United States or elsewhere,
wherein an unfavorable decision, ruling or finding would materially adversely
affect the business, property, operations, condition (financial or otherwise),
earnings or general affairs of the Company. In addition, you shall have
received, at the First Closing Date, a certificate signed by the principal
executive officer and by the principal financial officer of the Company, dated
as of the First Closing Date, evidencing on behalf of the Company compliance
with the provisions of this Section 4(g).
(f) TRANSFER AND WARRANT AGENT. On or before the
Effective Date, the Company shall have appointed American Stock Transfer &
Trust Company (or other agent mutually acceptable to the Company and Xxxxx
Xxxx), as its transfer agent and warrant agent ("Transfer Agent") to transfer
all of the shares of Common Stock and Warrants issued in the Offering, as
well as to transfer other shares of the Common Stock outstanding from time to
time.
(g) NASD APPROVAL OF UNDERWRITERS' COMPENSATION. By the
Effective Date, the Underwriters shall have received clearance from the NASD as
to the amount of compensation allowable or payable to the Underwriters, as
described in the Registration Statement.
(h) CERTAIN FURTHER MATTERS. On each Closing Date,
Underwriters' Counsel shall have been furnished with all such other documents
and certificates as they may reasonably request for the purpose of enabling them
to render their legal opinion to the Underwriters and in order to evidence the
accuracy and completeness of any of the representations, warranties or
statements, the performance of any of the covenants, or the fulfillment of any
of the conditions, herein contained.
(i) All proceedings taken in connection with the
authorization, issuance or sale of the Securities, as herein contemplated shall
be reasonably satisfactory in form and substance to the Underwriters and to
Underwriters' Counsel;
(ii) On each Closing Date there shall have been duly
tendered to you for your account the appropriate number of Securities;
(iii) No order suspending the sale of the Securities
in any
19
20
jurisdiction designated by you pursuant to Section 3(b) hereof shall have
been issued on either Closing Date, and no proceedings for that purpose shall
have been instituted or, to the knowledge of the Underwriters or the Company,
shall be contemplated;
(iv) Prior to each Closing Date there shall not have been
received or provided by the Company's independent public accountants or
attorneys, qualifications to the effect of either difficulties in furnishing
certifications as to material items including, without limitation, information
contained within the footnotes to the financial statements, or as affecting
matters incident to the issuance and sale of the Securities or as to corporate
proceedings or other matters;
(v) On or prior to the First Closing Date, the
Underwriters' Warrant, the Warrant Agreement and the Financial Consulting
Agreement shall have been executed and delivered by the Company, and the Lock-Up
Agreements shall have been executed and delivered by all of the Company's
officers, directors and existing stockholders, to the Underwriters.
(i) ADDITIONAL CONDITIONS. Upon exercise of the Over-Allotment
Option, Xxxxx Xxxx'x obligations to purchase and pay for the Option Securities
shall be subject (as of the date hereof and as of the Option Closing Date) to
the following conditions:
(i) The Registration Statement shall remain effective at the
Option Closing Date, no stop order denying or suspending the effectiveness
thereof shall have been issued, and no proceedings for that or any similar
purpose shall have been instituted or shall be pending or, to your knowledge or
the knowledge of the Company, shall be contemplated by the Commission, and all
reasonable requests on the part of the Commission for additional information
shall have been complied with to the satisfaction of Underwriters' Counsel.
(ii) On the Option Closing Date there shall have been
delivered to you the signed opinion of Company Counsel, dated as of the
Option Closing Date, in form and substance satisfactory to Underwriters'
Counsel, which opinion shall be substantially the same in scope and substance as
the opinion furnished to you on the First Closing Date pursuant to Section 4(b),
except that such opinion, where appropriate, shall cover the Option Units rather
than the Firm Securities. If the First Closing Date is the same as the Option
Closing Date, such opinions may be combined.
(iii) All proceedings taken at or prior to the Option Closing
Date in connection with the sale and issuance of the Option Securities shall be
satisfactory in form and substance to you, and you and Underwriters' Counsel
shall have been furnished with all such documents, certificates and opinions as
you may reasonably request in connection with this transaction in order to
evidence the accuracy and completeness of any of the representations, warranties
or statements of the Company or its compliance with any of the covenants or
conditions contained herein.
20
21
(iv) On the Option Closing Date there shall have been
delivered you a letter in form and substance satisfactory to Xxxxx Xxxx from
Coopers & Xxxxxxx, dated the Option Closing Date addressed to you, confirming
the information in their letter referred to in Section 4(f) as of the date
thereof and stating that, without any additional investigation required, nothing
has come to their attention during the period from the ending date of their
review referred to in such letter to a date not more than five banking days
prior to the Option Closing Date which would require any change in such letter
if it were required to be dated the Option Closing Date.
Any certificate signed by any officer of the Company and delivered to
the Underwriters or to Underwriters' Counsel shall be deemed a
representation and warranty by the Company to the Underwriters as to the
statements made therein. If any of the conditions herein provided for in this
Section shall not have been completely fulfilled as of the date indicated, this
Agreement and all obligations of the Underwriters under this Agreement may be
canceled at, or at any time prior to, each Closing Date by your notifying the
Company of such cancellation in writing or by telecopy at or prior to the
applicable Closing Date. Any such cancellation shall be without liability of
any Underwriters to the Company, except as otherwise provided herein.
5. CONDITIONS TO THE OBLIGATIONS OF THE COMPANY. The obligations
of the Company to sell and deliver the shares of Common Stock and Warrants are
subject to the following conditions:
(a) EFFECTIVE REGISTRATION STATEMENT. The Registration
Statement shall have become effective not later than 6:00 p.m. New York Time,
on the date of this Agreement, or at such later time or on such later date as
the Company and you may agree in writing.
(b) NO STOP ORDER. On the applicable Closing Date, no stop
order denying or suspending the effectiveness of the Registration
Statement shall have been issued or threatened by the Commission and no
proceedings for similar purposes shall have been instituted or shall be pending
(c) PAYMENT FOR SECURITIES. On the applicable Closing Date,
you shall have made payment, for the several accounts of the Underwriters, of
the aggregate Purchase Price for the shares of Common Stock and Warrants then
being purchased by certified or bank cashier's checks payable in next day funds
to the order of the Company.
If the conditions to the obligations of the Company provided by this Section 5
have been fulfilled on the First Closing Date but are not fulfilled after the
First Closing Date and prior to the Option Closing Date, then only the
obligation of the Company to sell and deliver the Option Securities upon
exercise of the Over-Allotment Option shall be affected.
6. INDEMNIFICATION.
(a) INDEMNIFICATION BY THE COMPANY. As used in this
Agreement, the
21
22
term "Liabilities" shall mean any and all losses, claims, damages and
liabilities, and actions and proceedings in respect thereof (including without
limitation all reasonable costs of defense and investigation and all attorneys'
fees) including, without limitation, those asserted by any party to this
Agreement against any other party to this Agreement. The Company hereby
indemnifies and holds harmless the Underwriters and each person, if any, who
controls the Underwriters within the meaning of the Act, from and against all
Liabilities, joint or several, to which the Underwriters or such controlling
person may become subject, under the Act or otherwise, insofar as such
Liabilities arise out of or are based upon: (i) any untrue statement or alleged
untrue statement of any material fact, in light of the circumstances in which
it was made, contained in (A) the Registration Statement or any amendment
thereto, or the Prospectus or any Preliminary Prospectus, or any amendment or
supplement thereto, or (B) any "blue sky" application or other document
executed by the Company specifically 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 Securities under the securities laws
thereof (any such application, document or information being herein called a
"Blue Sky Application"); or (ii) the omission or alleged omission to state in
the Registration Statement or any amendment thereto, or the Prospectus or any
Preliminary 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, in light of the circumstances in
which it was made, not misleading; provided, however, that the Company shall
not be liable in any such case to the extent, but only to the extent, that any
such Liabilities arise out of or are based upon an untrue statement or alleged
untrue statement or omission or alleged omission (x) made in reliance upon and
in conformity with written information furnished to the Company through you by
or on behalf of the Underwriters specifically for use in the preparation of the
Registration Statement or any such amendment thereto, or the Prospectus or any
such Preliminary Prospectus, or any such amendment or supplement thereto, or
any such Blue Sky Application or (y) corrected by the final Prospectus and the
failure of the Underwriters to deliver the final Prospectus. The foregoing
indemnity shall be in addition to any other liability which the Company may
otherwise have.
(b) INDEMNIFICATION BY UNDERWRITERS. The Underwriters,
jointly and severally, hereby indemnify and hold harmless the Company, each of
its directors, each nominee (if any) for director named in the Prospectus, each
of its officers who have signed the Registration Statement, and each person, if
any, who controls the Company within the meaning of the Act, from and against
all Liabilities to which the Company or any such director, nominee, officer or
controlling person may become subject under the Act or otherwise, insofar as
such Liabilities arise out of or are based upon (i) any untrue statement or
alleged untrue statement of any material fact contained in the Registration
Statement or any amendment thereto, or the Prospectus or any Preliminary
Prospectus, or any amendment or supplement thereto, or (ii) the omission or the
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that (A) any such Liabilities arise out of or
are based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in the Registration Statement or any amendment thereto,
or the Prospectus or any Preliminary Prospectus, or any amendment or supplement
thereto, in
22
23
reliance upon and in conformity with written information furnished to the
Company through you, by or on behalf of such Underwriters, specifically for use
in the preparation thereof, or (B) a copy of the Prospectus (as then amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) was not sent or given by or on behalf of such Underwriters to the
person asserting such Liabilities and who purchased Securities from such
Underwriters, if required by law so to have been delivered, at or prior to the
written confirmation of the sale of the Securities to such person, if the
Prospectus (as so amended or supplemented) would have cured the defect giving
rise to such Liability. In no event shall the Underwriters be liable under
this Section 6(b) for any amount in excess of the compensation received by the
Underwriters, in the form of underwriting discounts or otherwise, pursuant to
this Agreement or any other agreement contemplated hereby. The foregoing
indemnity shall be in addition to any other liability which the Underwriters
may otherwise have.
(c) PROCEDURE. Promptly after receipt by an indemnified
party under this Section 6 of notice of the commencement of any action,
such indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under this Section 6, notify in writing the
indemnifying party of the commencement thereof, but the omission so to notify
the indemnifying party shall not relieve it from any liability which it may
have to any indemnified party otherwise than under this Section 6 unless the
rights of the indemnifying party have been prejudiced by such omission or
delay. In case any such action is brought against any indemnified party and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate in and, to the extent that it may wish,
jointly with any other indemnifying party similarly notified, to assume the
defense thereof, subject to the provisions hereof, with counsel reasonably
satisfactory to such indemnified party, and after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be liable to such indemnified party
under this Section 6 for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof other than
reasonable costs of investigation. The indemnified party shall have the right
to employ separate counsel in any such action and to participate in the defense
thereof, but the fees and expenses of such counsel shall not be at the expense
of the indemnifying party if the indemnifying party has assumed the defense of
the action with counsel reasonably satisfactory to the indemnified party;
provided, however, that the fees and expenses of such counsel shall be at the
expense of the indemnifying party if (i) the employment of such counsel has
been specifically authorized in writing by the indemnifying party, or (ii) the
named parties to any such action (including any impleaded parties) include both
such indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there may be legal defenses available to
it which are different from or in addition to those available to the
indemnifying party or that the indemnified and indemnifying party have
conflicting interests which would make it inappropriate for the same counsel to
represent both of them (in which case the indemnifying party shall into have
the right to assume the defense of such action on behalf of the indemnified
party, it being understood, however, that the indemnifying party shall not, in
connection with any one such action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses
23
24
of more than one separate firm of attorneys). No settlement of any
action against an indemnified party shall be made without the consent of the
indemnified party, which shall not be unreasonably withheld in light of all
factors of importance to such indemnified party.
7. CONTRIBUTION. In order to provide for just and equitable
contribution under the Act in any case in which (a) any indemnified party
makes claims for indemnification pursuant to Section 6 but it is judicially
determined (by the entry of a final judgment or decree by a court of competent
jurisdiction and the expiration of time to appeal or the denial of the last
right of appeal) that such indemnification may not be enforced in such case,
notwithstanding the fact that the express provisions of Section 6 provide for
indemnification in such case, or (b) contribution under the Act may be required
on the part of any indemnified party, then such indemnified party and each
indemnifying party (if more than one) shall contribute to the aggregate
Liabilities to which it may be subject, in either such case (after contribution
from others) in such proportion that the Underwriters is responsible in the
aggregate for the portion of such Liabilities represented by the percentage
that the underwriting discount per share of Common Stock and Warrant
appearing on the cover page of the Prospectus bears to the public Offering
price per share of Common Stock and Warrant appearing thereon, and the Company
shall be responsible for the remaining portion; provided, however, that if such
allocation is not permitted by applicable law, then the relative fault of the
Company, and the Underwriters in connection with the statements or omissions
which resulted in such Liabilities and other relevant equitable considerations
shall also be considered. The relative fault shall be determined by reference
to, among other things, whether in the case of an untrue statement of material
fact or the omission to state a material fact, such statement or omission
relates to information supplied by the Company, or the Underwriters, 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 the respective
obligations of the Company, and the Underwriters to contribute pursuant to this
Section 7 were to be determined by pro rata or per capita allocation of the
aggregate Liabilities or by any other method of allocation that does not take
account of the equitable considerations referred to in the first sentence of
this Section 7. Moreover, the contribution of the Underwriters shall not be in
excess of the cash compensation received by the Underwriters, in the form of
underwriting discounts or otherwise, pursuant to this agreement or any other
agreement contemplated hereby. No person guilty of a fraudulent
misrepresentation (within the meaning of section 11(f) of the Act) shall be
entitled to contribution from any person who is not guilty of such fraudulent
misrepresentation. As used in this Section 7, for purposes of determining the
relevant fault, the term "Company" shall include any officer, director or
person who controls the Company within the meaning of section 15 of the Act. If
the full amount of the contribution specified in this Section 7 is not
permitted by law, then each indemnified party and each person who controls an
indemnified party shall be entitled to contribution from each indemnifying
party to the full extent permitted by law. The foregoing contribution
agreement shall in no way affect the contribution liabilities of any persons
having liability under section 11 of the Act other than the Company and the
Underwriters. No contribution shall be requested with regard to the settlement
of any matter from any party who did not consent to the settlement; provided,
however, that such consent shall not be unreasonably withheld in light of all
factors of importance
24
25
to such party.
8. COSTS AND EXPENSES.
(a) CERTAIN COSTS AND EXPENSES. Whether or not this
Agreement becomes effective or the sale of the shares of Common Stock and
Warrants to the Underwriters is consummated, the Company shall pay all costs
and expense incident to the issuance, offering, sale and delivery of the Units
and the performance of its obligations under this Agreement, including without
limitation: (i) all fees and expenses of the Company's legal counsel and
accountants; (ii) all costs and expenses incident to the preparation, printing,
filing and distribution of the Registration Statement (including the financial
statements contained therein and all exhibits and amendments thereto), each
Preliminary Prospectus and the Prospectus, each as amended or supplemented,
this Agreement and the other underwriting documents, as well as the other
agreements and documents referred to herein and the Blue Sky Memorandum; each
in such quantities as you shall deem necessary; (iii) all fees of NASD
required in connection with the filing required by NASD to be made by the
Underwriters with respect to the Offering; (iv) all expenses, including fees
(but not in excess of the amount set forth in Section 3(b)) and disbursements
of Underwriters' Counsel in connection with the qualification of the Securities
under the "blue sky" laws which you shall designate; (v) all costs and expenses
of printing the respective certificates representing the shares of Common Stock
and the Warrants; (vi) the expense of placing one or more "tombstone"
advertisements or promotional materials as directed by you (provided, however,
that the aggregate amount thereof shall not exceed $10,000) and of offering
memorabilia; (vii) all costs and expenses of the Company and its employees (but
not of the Underwriters or their employees) associated with due diligence
meetings and presentations (including the payment for road show conference
centers); (viii) all costs and expenses associated with the preparation of a
seven to ten minute professional video presentation concerning the Company, its
products and its management for broker due diligence purposes; (ix) any and all
taxes (including without limitation any transfer, franchise, capital stock or
other tax imposed by any jurisdiction) on sales of the shares of Common Stock
and Warrants to the Underwriters hereunder; and (x) all costs and expenses
incident to the furnishing of any amended Prospectus or any supplement to be
attached to the Prospectus as required by Sections 3(a) and 3(d), except as
otherwise provided by said Sections. In addition, the Company shall engage
Underwriters' Counsel to provide the Underwriters, at the Closing and quarterly
thereafter, until such time as the Common Stock is listed on the New York Stock
Exchange or the American Stock Exchange or quoted on NASDAQ/NMS, with a
memorandum, setting forth those states in which the Common Stock and the
Warrants may be traded in non-issuer transactions under the blue sky laws of
the 50 states. The Company shall pay such counsel a one-time fee of $12,500 at
the Closing for such opinions.
(b) UNDERWRITERS' EXPENSE ALLOWANCE. In addition to the
expenses described in Section 8(a), the Company shall on the First Closing
Date pay to Xxxxx Xxxx a non-accountable expense allowance, which shall include
fees of Underwriters' Counsel, exclusive of the fees referred to in Section
3(b), of $224,100 (that being an amount equal to three percent (3%)
25
26
of the gross proceeds received upon sale of the Firm Securities). In the
event that the Over-Allotment Option is exercised, then the Company shall, on
the Option Closing Date, pay to Xxxxx Xxxx, based on the number of Option
Securities to be sold by the Company, an additional amount equal to three
percent (3%) of the gross proceeds received upon sale of any of the Option
Securities, in the amount of $33,615 if the Over-Allotment Option is exercised
in full.
(c) NO FINDERS. No person is entitled either directly or
indirectly to compensation from the Company, the Underwriters or any other
person for services as a finder in connection with the Offering, and the
Company hereby indemnifies and holds harmless the Underwriters, and the
Underwriters hereby jointly and severally, indemnify and hold harmless the
Company from and against all Liabilities, joint or several, to which the
indemnified party may become subject insofar as such Liabilities arise out of
or are based upon the claim of any person (other than an employee of the party
claiming indemnity) or entity that he or it is entitled to a finder's fee in
connection with the Offering by reason of such person's or entity's influence
or prior contact with the indemnifying party.
9. EFFECTIVE DATE. The Agreement shall become effective upon its
execution, except that you may, at your option, delay its effectiveness
until 10:00 a.m., New York time, on the first full business day following the
Effective Date, or at such earlier time after the Effective Date as you in your
discretion shall first commence the initial public offering by the Underwriters
of any of the shares of Common Stock and Warrants. The time of the initial
public offering shall mean the time of release by you of the first newspaper
advertisement which is subsequently published with respect to the shares of
Common Stock and Warrants, or the time when the shares of Common Stock and
Warrants are first generally offered by you to dealers by letter or telegram,
whichever shall first occur. This Agreement may be terminated by you at any
time before it becomes effective as provided above, except that the provisions
of Sections 3(x), 6, 7, 8, 12, 13, 14 and 15 shall remain in effect
notwithstanding such termination.
10. TERMINATION.
(a) GROUNDS FOR TERMINATION.
(i) This Agreement, except for Sections 3(x), 6, 7, 8,
12, 13, 14 and 15, may be terminated at any time prior to the First Closing
Date, and the Over-Allotment Option, if exercised, may be canceled at any time
prior to the Option Closing Date, by you if in your sole judgment it is
impracticable to offer for sale or to enforce contracts made by you for the
resale of the shares of Common Stock and Warrants agreed to be purchased
hereunder, by reason of: (A) the Company having sustained a material loss,
whether or not insured, by reason of fire, earthquake, flood, accident or other
calamity, or from any labor dispute or court or government action, order or
decree; (B) trading in securities on the New York Stock Exchange or the American
Stock Exchange having been suspended or limited; (C) material governmental
restrictions having been imposed on trading in securities generally which are
not in force and
26
27
effect on the date hereof; (D) a banking moratorium having been declared
by federal or New York State authorities; (E) an outbreak or significant
escalation of major international hostilities or other national or international
calamity having occurred; (F) the passage by the Congress of the United States
or by any state legislative body of similar impact, of any act or measure, or
the adoption of any orders, rules or regulations by any governmental body or any
authoritative accounting institute or board, or any governmental executive,
which is reasonably believed likely by you to have a material adverse impact on
the business, financial condition or financial statements of the Company; (G)
any material adverse change in the financial or securities markets beyond normal
fluctuations in the United States having occurred since the date of this
Agreement; or (H) any material adverse change having occurred, since the
respective dates for which information is given in the Registration Statement
and Prospectus, in the earnings, business, prospects or condition (financial or
otherwise) of the Company, whether or not arising in the ordinary course of
business.
(ii) Xxxxx Xxxx shall have the right, in its sole
discretion, to terminate this Agreement, including without limitation,
the obligation to purchase the Firm Securities and the obligation to purchase
the Option Securities after the exercise of the Over-Allotment Option, by notice
given to the Company prior to delivery and payment for all the Firm Securities
or the Option Securities, as the case may be, if any of the conditions
enumerated in Section 4 are not either fulfilled or waived by the Underwriters
on or before any Closing Date.
(iii) Anything herein to the contrary notwithstanding, if
this Agreement shall not be carried out within the time specified herein, or
any extensions thereof granted by the Underwriters, by reason of any failure on
the part of the Company to perform any undertaking or satisfy any condition of
this Agreement by it to be performed or satisfied then, in addition to the
obligations assumed by the Company pursuant to Section 8(a) hereof, the
Underwriters shall provide the Company with, and the Company shall pay, a
statement of the Underwriters' accountable expenses.
(b) NOTIFICATION. If you elect to prevent this Agreement
from becoming effective or to terminate this Agreement as provided by this
Section 10 or by Section 9, the Company shall be promptly notified by you, by
telephone or telegram, confirmed by letter.
11. UNDERWRITERS' WARRANT. On the First Closing Date, the Company
shall issue and sell to you, for $10.00, and upon the terms and conditions
set forth in the form of Underwriters' Warrants filed as an exhibit to the
Registration Statement, an option entitling you to purchase 180,000 shares of
Common Stock and 270,000 Warrants at an exercise price equal to 165% of the
initial public offering price per Share and Warrant exercisable for a period of
five years commencing one year from the Effective Date (the "Underwriters'
Warrant"). The Warrants underlying the Underwriters' Warrant shall be
exercisable at $7.43 per Share of Common Stock. The Underwriters' Warrant
grants to the holders thereof certain "piggyback" registration rights for a
period of five years, and demand registration rights for a period of five years,
commencing one year from the Effective Date with respect to the registration
under the Securities Act of the Securities issuable upon exercise thereof. In
the event of conflict in the terms of this Agreement
27
28
and the Underwriters' Warrant, the terms and conditions of the Underwriters'
Warrant shall control.
12. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. The respective indemnities, agreements, representations,
warranties, covenants and other statements of the Company and the Underwriters
set forth in Sections 3, 6, 7 and 8 of this Agreement shall remain in full force
and effect regardless of any investigation made by or on behalf of any other
party, and shall survive delivery of and payment for the shares of Common Stock
and Warrants and the termination of this Agreement. The Company hereby
indemnifies and holds harmless the Underwriters from and against all
Liabilities, joint or several, to which the Underwriters may become subject
insofar as such Liabilities arise out of or are based upon the breach or failure
by the Company to perform of any of the provisions of Sections 3, 6, 7 and 8.
13. NOTICES. All communications hereunder shall be in writing and,
except as otherwise expressly provided herein, if sent to you, shall be
mailed, delivered or telegraphed and confirmed to you at Xxxxx Xxxx & Co., Inc.,
000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 and X.X. Xxxxxxx & Co., Inc., Xxx
Xxxxxxx Xxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, with a copy sent to Xxx X.
Xxxxxxxxx, Esq., Xxxxxxx, Savage, Kaplowitz, & Xxxxxxxxxx, LLP, 000 Xxxx 00xx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; or if sent to the Company, shall be mailed,
delivered, or telegraphed and confirmed to it at Rockwell Medical Technologies,
Inc., 00000 Xxxxxxx Xxxx Xxxxx, Xxxxx, Xxxxxxxx 00000, with a copy sent to
Xxxxxxx X. Xxxxx, Esq., Xxxxxxxx Xxxxxx Xxxxxxxx & Xxxx, 2290 First National
Building, 000 Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000-0000.
14. PARTIES IN INTEREST. This Agreement is made solely for the
benefit of the Underwriters, the Company, and, to the extent expressed, any
person controlling the Company or the Underwriters, as the case may be, and the
directors of the Company, nominees for directors of the Company (if any) named
in the Prospectus, officers of the Company who have signed the Registration
Statement, and their respective executors, administrators, successors and
assigns; and no other person shall acquire or have any right under or by virtue
of this Agreement. The term "successors and assigns" shall not include any
purchaser, as such, from the Underwriters of the shares of Common Stock and
Warrants.
15. CONSTRUCTION. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of New York,
without giving effect to conflict of laws. The parties agree to submit
themselves to the jurisdiction of the courts of the State of New York or of the
United States of America for the Southern District of New York, which shall be
the sole tribunals in which any parties may institute and maintain a legal
proceeding against the other party arising from any dispute in this Agreement.
In the event either party initiates a legal proceeding in a jurisdiction other
than in the courts of the State of New York or of the United States of America
for the Southern District of New York, the other party may assert as a complete
defense and as a basis for dismissal of such legal proceeding that the legal
28
29
proceeding was not initiated and maintained in the courts of the State of
New York or of the United States of America for the Southern District of New
York, in accordance with the provisions of this Section 15.
16. ENTIRE AGREEMENT. This Agreement, the Underwriters' Warrant
and the Financial Consulting Agreement contain the entire agreement between the
parties hereto in connection with the subject matter hereof and thereof.
17. COUNTERPARTS. This Agreement may be executed in two or more
counterpart copies, each of which shall be deemed and an original but all of
which together shall constitute one and the same instrument.
[Signatures on following page]
29
30
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return this Agreement, whereupon it will become a
binding agreement between the Company and the Underwriters in accordance with
its terms.
Very truly yours,
ROCKWELL MEDICAL TECHNOLOGIES, INC.
By:
--------------------------------
Name:
Title:
Accepted as of the date
first above written:
New York, New York
XXXXX XXXX & CO., INC.
By:
--------------------------
Name:
Title:
X.X. XXXXXXX & CO., INC.
By:
--------------------------
Name:
Title:
30
