1,500,000 Shares FUEL SYSTEMS SOLUTIONS, INC. Common Stock, par value $0.001 per share PLACEMENT AGENCY AGREEMENT
Exhibit 1.1
1,500,000 Shares
Common Stock, par value $0.001 per share
June 22, 2009
▇▇▇▇▇▇▇ & Company, LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Fuel Systems Solutions, Inc., a Delaware corporation (the “Company”), proposes to issue and
sell to the purchasers, pursuant to the terms of this Placement Agency Agreement (this “Agreement”)
and the Subscription Agreements in the form of Exhibit A attached hereto (the “Subscription
Agreements”) entered into with the purchasers identified therein (each a “Purchaser” and
collectively, the “Purchasers”), up to an aggregate of 1,500,000 shares of common stock, $0.001 par
value per share (the “Common Stock”) of the Company. The aggregate of 1,500,000 shares so proposed
to be sold is hereinafter referred to as the “Shares.” The Company hereby confirms its agreement
with ▇▇▇▇▇▇▇ & Company, LLC to act as Placement Agent (“▇▇▇▇▇▇▇”, or the “Placement Agent”) in
accordance with the terms and conditions hereof.
1. Agreement to Act as Placement Agent.
On the basis of the representations, warranties and agreements of the Company herein
contained, and subject to all the terms and conditions of this Agreement:
(a) The Company hereby authorizes the Placement Agent to act as its sole agent to
solicit offers for the purchase of all or part of the Shares from the Company in connection
with the proposed offering of the Shares (the “Offering”). Until the Closing Date (as
defined in Section 3 hereof), the Company shall not, without the prior written
consent of the Placement Agent, solicit or accept offers to purchase Shares otherwise than
through the Placement Agent.
(b) The Company hereby acknowledges that the Placement Agent has agreed, as agent of
the Company, to use its commercially reasonable best efforts to solicit offers to purchase
the Shares from the Company on the terms and subject to the conditions set forth in the
Prospectus (as defined below). The Placement Agent shall use commercially reasonable best
efforts to assist the Company in obtaining performance by each Purchaser whose offer to
purchase Shares has been solicited by the Placement Agent and accepted by the Company, but
the Placement Agent shall not, except as otherwise provided in this Agreement, be obligated
to disclose the identity of any potential purchaser or have any liability to the Company in
the event any such purchase is not consummated for any reason. Under no circumstances will
the Placement Agent be obligated to underwrite or
purchase any Shares for its own account and, in soliciting purchases of Shares, the
Placement Agent shall act solely as the Company’s agent and not as principal.
Notwithstanding the foregoing and except as otherwise provided in Section 2(c), it
is understood and agreed that the Placement Agent (or its affiliates) may, solely at its
discretion and without any obligation to do so, purchase Shares as principal.
(c) Subject to the provisions of this Section 1, offers for the purchase of
Shares may be solicited by the Placement Agent as agent for the Company at such times and in
such amounts as the Placement Agent deems advisable. The Placement Agent shall communicate
to the Company orally or in writing, each reasonable offer (including the identity of the
potential purchaser) to purchase Shares received by it as agent of the Company. The Company
shall have the sole right to accept offers to purchase the Shares and may reject any such
offer, in whole or in part. The Placement Agent shall have the right, in its discretion
reasonably exercised, without notice to the Company, to reject any offer to purchase Shares
received by it, in whole or in part, and any such rejection shall not be deemed a breach of
its agreement contained herein.
(d) The Shares are being sold to the Purchasers at a price of $20.00 per share. The
purchases of the Shares by the Purchasers shall be evidenced by the execution of a
Subscription Agreement by each of the Purchasers and the Company.
(e) As compensation for services rendered, on the Closing Date (as defined in
Section 3 hereof), the Company shall pay to the Placement Agent by wire transfer of
immediately available funds to an account or accounts designated by the Placement Agent, an
aggregate amount equal to six percent (6.0%) of the gross proceeds received by the Company
from the sale of the Shares on such Closing Date (the “Placement Fee”).
(f) No Shares which the Company has agreed to sell pursuant to this Agreement and the
Subscription Agreements shall be deemed to have been purchased and paid for, or sold by the
Company, until such Shares shall have been delivered to the Purchaser thereof against
payment in full by such Purchaser. If the Company shall default in its obligations to
deliver Shares to a Purchaser whose offer it has accepted, the Company shall indemnify and
hold the Placement Agent harmless against any loss, claim, damage or expense arising from or
as a result of such default by the Company in accordance with the procedures set forth in
Section 7(c) herein.
2. Representations and Warranties of the Company. The Company represents and
warrants to, and agrees with, the Placement Agent and the Purchasers that:
(a) The Company meets the requirements for the use of Form S-3. A registration
statement (Registration No. 333-159624) on Form S-3 relating to the Shares, including a base
prospectus relating to the Shares (the “Base Prospectus”) and such amendments thereto as may
have been required to the date of this Agreement, has been prepared by the Company under the
provisions of the Securities Act of 1933, as amended (the “Securities Act”), and the rules
and regulations (collectively referred to as the
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“Rules and Regulations”) of the Securities and Exchange Commission (the “Commission”)
thereunder, and has been filed with and has been declared effective by the Commission, and
the offering of the Shares complies with Rule 415 under the Securities Act. A final
prospectus supplement to the Base Prospectus relating to the Shares and the offering thereof
will be filed promptly by the Company with the Commission in accordance with Rule 424(b) of
the Rules and Regulations (such final prospectus supplement, as so filed, the “Prospectus
Supplement”). Such registration statement at any given time, including the amendments
thereto to such time, the exhibits and any schedules thereto at such time, the documents
otherwise deemed to be a part thereof or included therein by the Rules and Regulations
(including Rule 430B thereof), and any registration statement relating to the offering
contemplated by this Agreement and filed pursuant to Rule 462(b) of the Rules and
Regulations (“Rule 462(b)”), is herein called the “Registration Statement.” The term
“preliminary prospectus” means the any preliminary prospectus (including any preliminary
prospectus supplement) relating to the Shares and the offering thereof as first filed with
the Commission pursuant to Rule 424(b) of the Rules and Regulations (“Rule 424(b)”). The
term “Prospectus” means the Base Prospectus together with the Prospectus Supplement, except
that if such Base Prospectus is amended or supplemented on or prior to the date on which the
Prospectus Supplement was first filed pursuant to Rule 424(b), the term “Prospectus” shall
mean the Base Prospectus as so amended or supplemented and as supplemented by the Prospectus
Supplement. Any reference herein to the Registration Statement, the Base Prospectus, a
preliminary prospectus, the Prospectus Supplement, or the Prospectus shall be deemed to
refer to and include the documents incorporated by reference therein, and any reference
herein to the terms “amend,” “amendment” or “supplement” with respect to the Registration
Statement, the Base Prospectus, a preliminary prospectus, the Prospectus Supplement, or the
Prospectus shall be deemed to refer to and include the filing of any document under the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), after the time the
Registration Statement initially became effective (the “Effective Date”), the date of the
Base Prospectus, any preliminary prospectus, the Prospectus Supplement, or the Prospectus,
as the case may be, and deemed to be incorporated therein by reference. The term “Issuer
Free Writing Prospectus” means any “issuer free writing prospectus,” as defined in Rule 433
of the Rules and Regulations (“Rule 433”), relating to the Shares that (i) is required to be
filed with the Commission by the Company or (ii) is exempt from filing pursuant to Rule
433(d)(5)(i) because it contains a description of the Shares or of the offering that does
not reflect the final terms, in each case in the form filed or required to be filed with the
Commission or, if not required to be filed , in the form retained in the Company’s records
pursuant to Rule 433(g).
No order preventing or suspending the use of the Base Prospectus, any preliminary
prospectus, the Prospectus Supplement, the Prospectus or any Issuer Free Writing Prospectus
has been issued by the Commission, and no stop order suspending the effectiveness of the
Registration Statement (including any related registration statement filed pursuant to Rule
462(b)) or any post-effective amendment thereto has been issued, and no proceeding for that
purpose has been initiated or threatened by the Commission. On the Effective Date, on the
date the Base Prospectus, any preliminary prospectus, the Prospectus Supplement, or the
Prospectus is first filed with the Commission pursuant to Rule 424(b) (if required), at all
times during the period through and including the Closing
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Date and when any post-effective amendment to the Registration Statement becomes effective
or any amendment or supplement to the Prospectus is filed with the Commission, the
Registration Statement and the Prospectus (as amended or as supplemented if the Company
shall have filed with the Commission any amendment or supplement thereto), including the
financial statements included or incorporated by reference in the Prospectus, did and will
comply with all applicable provisions of the Securities Act, the Exchange Act, the rules and
regulations of the Commission under the Exchange Act (the “Exchange Act Rules and
Regulations”), and the Rules and Regulations and will contain all statements required to be
stated therein in accordance with the Securities Act, the Exchange Act, the Exchange Act
Rules and Regulations, and the Rules and Regulations. As of the applicable effective date
as to each part of the Registration Statement, no part of the Registration Statement, the
Prospectus or any such amendment or supplement thereto did or will contain an untrue
statement of a material fact or omit to state a material fact required to be stated therein
or necessary in order to make the statements therein not misleading. At the Effective Date,
the date the Base Prospectus or any amendment or supplement to the Base Prospectus,
including any preliminary prospectus or the Prospectus Supplement, is filed with the
Commission, the date of first use of any preliminary prospectus or the Prospectus
Supplement, and at the Closing Date and, if later, the Option Closing Date, the Prospectus
did not and will not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
As of the Applicable Time, neither (x) any General Use Free Writing Prospectus(es) (as
defined below) issued at or prior to the Applicable Time (as defined below), the Pricing
Prospectus (as defined below) and the documents listed on Schedule I hereto, each as
applicable, all considered together (collectively, the “General Disclosure Package”), nor
(y) any individual Limited Use Free Writing Prospectus, when considered together with the
General Disclosure Package, included any untrue statement of a material fact or omitted to
state any material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
As used in this subsection and elsewhere in this Agreement:
“Applicable Time” means 5:00 pm (Eastern time) on the date of this Agreement or such
other time as agreed by the Company and the Placement Agent.
“General Use Free Writing Prospectus” means any Issuer Free Writing Prospectus that is
intended for general distribution to prospective investors, as evidenced by its being
specified in Schedule I hereto.
“Issuer Free Writing Prospectus” means any Issuer Free Writing Prospectus that is not
an General Use Free Writing Prospectus.
“Limited Use Free Writing Prospectus” means any Issuer Free Writing Prospectus that is
not a General Use Free Writing Prospectus.
“Pricing Prospectus” means the Base Prospectus, as amended or supplemented immediately
prior to the Applicable Time, including any document incorporated by
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reference therein and any prospectus supplement deemed to be a part thereof. For purposes
of this definition, information contained in a form of prospectus that is deemed
retroactively to be a part of the Registration Statement pursuant to Rule 430B shall be
considered to be included in the Pricing Prospectus only if the actual time that form of
prospectus is filed with the Commission pursuant to Rule 424(b) is prior to the Applicable
Time.
Each Issuer Free Writing Prospectus, as of its issue date and at all subsequent times
through the completion of the public offer and sale of the Shares or until any earlier date
that the issuer notified or notifies the Placement Agent as described in the next sentence,
did not, does not and will not include any information that conflicted, conflicts or will
conflict with the information contained in the Registration Statement or the Prospectus,
including any document incorporated by reference therein that has not been superseded or
modified. If there occurs an event or development as a result of which the General
Disclosure Package would include an untrue statement of a material fact or would omit to
state a material fact necessary in order to make the statements therein, in the light of the
circumstances then prevailing, not misleading, the Company will promptly notify the
Placement Agent so that any use of the General Disclosure Package may cease until it is
amended or supplemented to correct untrue statement or omission.
The foregoing representations and warranties in this Section 2(a) do not apply
to any statements or omissions made in reliance on and in conformity with information
relating to the Placement Agent furnished in writing to the Company by the Placement Agent
specifically for inclusion in the Registration Statement, the Prospectus Supplement, the
Pricing Prospectus, the Prospectus or any Issuer Free Writing Prospectus or any amendment or
supplement thereto. The Company acknowledges that (i) the statements set forth in the last
paragraph on the front cover page concerning the terms of the offering by the Placement
Agent and (ii) the statements concerning the Placement Agent contained in the first
paragraph under the heading “Plan of Distribution” (the “Placement Agent’s Information”) in
the Prospectus Supplement and the Pricing Prospectus and the Prospectus constitute the only
information relating to the Placement Agent furnished in writing to the Company by the
Placement Agent specifically for inclusion in the Registration Statement, the Prospectus
Supplement, the Pricing Prospectus, the Prospectus and any Issuer Free Writing Prospectus or
any amendment or supplement thereto.
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(b) The documents that are incorporated by reference in the Base Prospectus, any
preliminary prospectus, the Pricing Prospectus, and the Prospectus or from which information
is so incorporated by reference, when they became or become effective or were or are filed
with the Commission, as the case may be, complied or will comply in all material respects
with the requirements of the Securities Act or the Exchange Act, as applicable, and the
Rules and Regulations or the Exchange Act Rules and Regulations, as applicable; and any
documents so filed and incorporated by reference subsequent to the Effective Date shall,
when they are filed with the Commission, comply in all material respects with the
requirements of the Securities Act or the Exchange Act, as applicable, and the Rules and
Regulations or the Exchange Act Rules and Regulations, as applicable.
(c) Each Issuer Free Writing Prospectus, if any, as of its issue date and at all
subsequent times through the completion of the public offer and sale of the Shares or until
any earlier date that the Company notified or notifies the Placement Agent as described in
Section 4(e), did not, does not and will not include any information that
conflicted, conflicts or will conflict in any material respect with the information
contained in the Registration Statement, Pricing Prospectus or the Prospectus, including any
document incorporated by reference therein and any prospectus supplement deemed to be a part
thereof that has not been superseded or modified, or includes an untrue statement of a
material fact or omitted or would omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in the light of the
circumstances prevailing at the subsequent time, not misleading. The foregoing sentence
does not apply to statements in or omissions from any Issuer Free Writing Prospectus in
reliance upon, and in conformity with, written information furnished to the Company by the
Placement Agent specifically for inclusion therein, which information the parties hereto
agree is limited to the Placement Agent’s Information.
(d) The documents incorporated by reference in the Prospectus, when they became
effective or were filed with the Commission, as the case may be, conformed in all material
respects to the requirements of the Securities Act or the Exchange Act, as applicable, and
the rules and regulations of the Commission thereunder and none of such documents contained
any untrue statement of a material fact or omitted to state any material fact required to be
stated therein or necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading; and any further documents so filed and
incorporated by reference in the Prospectus, when such documents become effective or are
filed with the Commission , as the case may be, will conform in all material respects to the
requirements of the Securities Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder and will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they were made,
not misleading.
(e) The Company is not an “ineligible issuer” in connection with the offering pursuant
to Rules 164, 405 and 433 under the Securities Act. The Company has not, directly or
indirectly, distributed and will not distribute any offering material in connection with the
Offering other than any Preliminary Prospectus, the Prospectus and other materials, if any,
permitted under the Securities Act and consistent with Section
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4(b) below. The Company will file with the Commission all Issuer Free Writing
Prospectuses (other than a “road show,” as defined in Rule 433(d)(8) of the Rules and
Regulations), if any, in the time and manner required under Rules 163(b)(2) and 433(d) of
the Rules and Regulations.
(f) The Company and each of its subsidiaries (as defined in Section 14) have
been duly organized and are validly existing as corporations or other legal entities in good
standing (or the foreign equivalent thereof) under the laws of their respective
jurisdictions of organization. The Company and each of its subsidiaries are duly qualified
to do business and are in good standing as foreign corporations or other legal entities in
each jurisdiction in which their respective ownership or lease of property or the conduct of
their respective businesses require such qualification and have all power and authority
(corporate or other) necessary to own or hold their respective properties and to conduct the
businesses in which they are engaged, except where the failure to so qualify or have such
power or authority (i) would not have, singularly or in the aggregate, a material adverse
effect on the condition (financial or otherwise), results of operations, assets, business or
prospects of the Company and its subsidiaries taken as a whole, or (ii) impair in any
material respect the ability of the Company to perform its obligations under this Agreement
or the Subscription Agreements or to consummate any transactions contemplated by this
Agreement, the Subscription Agreements, the General Disclosure Package or the Prospectus
(any such effect as described in clauses (i) or (ii), a “Material Adverse Effect”). The
Company owns or controls, directly or indirectly, only the corporations, partnerships,
limited liability partnerships, limited liability companies, associations or other entities
set forth in Schedule C, annexed hereto.
(g) The Company has the full right, power and authority to enter into this Agreement,
each of the Subscription Agreements and that certain Escrow Agreement (the “Escrow
Agreement”) dated as of the date hereof by and among the Company, the Placement Agent and
the escrow agent named therein, and to perform and to discharge its obligations hereunder
and thereunder; and each of this Agreement, each of the Subscription Agreements and the
Escrow Agreement has been duly authorized, executed and delivered by the Company, and
constitutes a valid and binding obligation of the Company enforceable in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights
generally and by general equitable principles (whether enforcement is sought by proceedings
in equity or at law), and except insofar as the indemnification provisions hereof may be
limited by considerations of public policy.
(h) The Shares to be issued and sold by the Company to the Purchasers hereunder and
under the Subscription Agreements have been duly and validly authorized and, when issued and
delivered against payment therefor as provided herein and the Subscription Agreements, will
be duly and validly issued, fully paid and nonassessable and free of any preemptive or
similar rights and will conform in all material respects to the description thereof
contained in the General Disclosure Package and the Prospectus.
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(i) The Company has an authorized capitalization as set forth in the Pricing
Prospectus, and all of the issued shares of capital stock of the Company have been duly and
validly authorized and issued, are fully paid and non-assessable, have been issued in
compliance with federal and state securities laws, and conform in all material respects to
the description thereof contained in the General Disclosure Package and the Prospectus. As
of April 30, 2009, there were 16,074,276 shares of Common Stock issued and outstanding and
no shares of Preferred Stock, par value $0.001 of the Company issued and outstanding,
excluding treasury shares, and 30,165 shares of Common Stock issuable upon the vesting of
restricted stock and 90,100 shares issuable upon the exercise of all options, warrants and
convertible securities outstanding as of such date. Since such date, the Company has not
issued any securities, other than Common Stock of the Company issued pursuant to the
exercise of stock options previously outstanding under the Company’s stock option plans or
the issuance of restricted Common Stock pursuant to employee benefit plans. All of the
Company’s options, warrants and other rights to purchase or exchange any securities for
shares of the Company’s capital stock have been duly authorized and validly issued and were
issued in compliance with US federal and state securities laws. None of the outstanding
shares of Common Stock was issued in violation of any preemptive rights, rights of first
refusal or other similar rights to subscribe for or purchase securities of the Company.
There are no authorized or outstanding shares of capital stock, options, warrants,
preemptive rights, rights of first refusal or other rights to purchase, or equity or debt
securities convertible into or exchangeable or exercisable for, any capital stock of the
Company or any of its subsidiaries other than those described above or accurately described
in the General Disclosure Package. The description of the Company’s stock option, stock
bonus and other stock plans or arrangements, and the options or other rights granted
thereunder, as described in the General Disclosure Package and the Prospectus, accurately
and fairly present the information required to be shown with respect to such plans,
arrangements, options and rights.
(j) All the outstanding shares of capital stock of each subsidiary of the Company have
been duly authorized and validly issued, are fully paid and nonassessable and, except to the
extent set forth in the General Disclosure Package or the Prospectus, are owned by the
Company directly or indirectly through one or more wholly-owned subsidiaries, free and clear
of any claim, lien, encumbrance, security interest, restriction upon voting or transfer or
any other claim of any third party.
(k) The execution, delivery and performance of this Agreement, the Subscription
Agreements and the Escrow Agreement by the Company, the issue and sale of the Shares by the
Company and the consummation of the transactions contemplated hereby and thereby will not
(with or without notice or lapse of time or both) conflict with or result in a breach or
violation of any of the terms or provisions of, constitute a default or Debt Repayment
Triggering Event (as defined below) under, give rise to any right of termination or other
right or the cancellation or acceleration of any right or obligation or loss of a benefit
under, or give rise to the creation or imposition of any lien, encumbrance, security
interest, claim or charge upon any property or assets of the Company or any subsidiary
pursuant to, any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its
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subsidiaries is a party or by which the Company or any of its subsidiaries is bound or
to which any of the property or assets of the Company or any of its subsidiaries is subject,
or result in any violations of any law, statute, rule, regulation, judgment, order or decree
of any court or governmental agency or body, domestic or foreign, having jurisdiction over
the Company or any of its subsidiaries or any of their properties or assets, nor will such
actions result in any violation of the provisions of the charter or by-laws (or analogous
governing instruments, as applicable) of the Company or any of its subsidiaries, except for
such conflicts, breaches, violations that would not singularly or in the aggregate cause a
Material Adverse Effect. A “Debt Repayment Triggering Event” means any event or condition
that gives, or with the giving of notice or lapse of time would give the holder of any note,
debenture or other evidence of indebtedness (or any person acting on such holder’s behalf)
the right to require the repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any of its subsidiaries.
(l) Except for the registration of the Shares under the Securities Act and such
consents, approvals, authorizations, filings, registrations or qualifications as may be
required under the Exchange Act and applicable state or foreign securities laws, the
Financial Industry Regulatory Authority, Inc. (“FINRA”) and the Nasdaq Global Market in
connection with the offering and sale of the Shares by the Company, no consent, approval,
authorization or order of, or filing, qualification or registration with, any court or
governmental agency or body, foreign or domestic, which has not been made, obtained or taken
and is not in full force and effect, is required for the execution, delivery and performance
of this Agreement, the Subscription Agreements and the Escrow Agreement by the Company, the
offer or sale of the Shares or the consummation of the transactions contemplated hereby or
thereby.
(m) BDO ▇▇▇▇▇▇▇, LLP, who have certified certain financial statements and related
schedules included or incorporated by reference in the Registration Statement, the General
Disclosure Package and the Prospectus, and have audited the Company’s internal control over
financial reporting and management’s assessment thereof, is an independent registered public
accounting firm as required by the Securities Act and the Rules and Regulations and the
Public Company Accounting Oversight Board (United States) (the “PCAOB”). Except as
disclosed in the Registration Statement and as pre-approved in accordance with the
requirements set forth in Section 10A of the Exchange Act, neither BDO ▇▇▇▇▇▇▇, LLP nor
PricewaterhouseCoopers LLP (the Company’s current independent registered accounting firm)
has been engaged by the Company to perform any “prohibited activities” (as defined in
Section 10A of the Exchange Act).
(n) The financial statements, together with the related notes and schedules, included
or incorporated by reference in the General Disclosure Package, the Prospectus and in the
Registration Statement fairly present in all material respects the financial position and
the results of operations and changes in financial position of the Company and its
consolidated subsidiaries and other consolidated entities at the respective dates or for the
respective periods therein specified. Such statements and related notes and schedules have
been prepared in accordance with the generally accepted accounting principles in the United
States (“GAAP”) applied on a consistent basis throughout the
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periods involved except as may be set forth in the related notes included or
incorporated by reference in the General Disclosure Package. The financial statements,
together with the related notes and schedules, included or incorporated by reference in the
General Disclosure Package and the Prospectus comply in all material respects with the
Securities Act, the Rules and Regulations, the Exchange Act and the Exchange Act Rules and
Regulations. No other financial statements or supporting schedules or exhibits are required
by the Securities Act or the Rules and Regulations to be described, or included or
incorporated by reference in the Registration Statement, the General Disclosure Package or
the Prospectus. There is no pro forma or as adjusted financial information which is
required to be included in the Registration Statement, the General Disclosure Package, or
and the Prospectus or a document incorporated by reference therein in accordance with the
Securities Act and the Rules and Regulations which has not been included or incorporated as
so required.
(o) Neither the Company nor any of its subsidiaries has sustained, since the date of
the latest audited financial statements included or incorporated by reference in the General
Disclosure Package, any material loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as set forth or
contemplated in the General Disclosure Package; and, since such date, there has not been any
material change in the capital stock or long-term debt of the Company or any of its
subsidiaries, or any material adverse changes, or any development involving a prospective
material adverse change, in or affecting the business, assets, general affairs, management,
financial position, prospects, stockholders’ equity or results of operations of the Company
and its subsidiaries taken as a whole, otherwise than as set forth or contemplated in the
General Disclosure Package.
(p) Except as set forth in the General Disclosure Package, there is no legal or
governmental action, suit, claim or proceeding pending to which the Company or any of its
subsidiaries is a party or of which any property or assets of the Company or any of its
subsidiaries is the subject which is required to be described in the Registration Statement,
the General Disclosure Package or the Prospectus or a document incorporated by reference
therein and is not described therein, or which, singularly or in the aggregate, if
determined adversely to the Company or any of its subsidiaries, is reasonably likely to have
a Material Adverse Effect; and to the best of the Company’s knowledge, no such proceedings
are threatened or contemplated by governmental authorities or threatened by others.
(q) Neither the Company nor any of its subsidiaries is in (i) violation of its charter
or by-laws (or analogous governing instrument, as applicable), (ii) default in any respect,
and no event has occurred which, with notice or lapse of time or both, would constitute such
a default, in the due performance or observance of any term, covenant or condition contained
in any indenture, mortgage, deed of trust, loan agreement, lease or other agreement or
instrument to which it is a party or by which it is bound or to which any of its property or
assets is subject or (iii) violation in any respect of any law, ordinance, governmental
rule, regulation or court order, decree or judgment to which it or its property or assets
may be subject except, in the case of clauses (ii) and (iii) of this
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paragraph (q), for any violations or defaults which, singularly or in the aggregate,
would not have a Material Adverse Effect.
(r) The Company and each of its subsidiaries possess all licenses, certificates,
authorizations and permits issued by, and have made all declarations and filings with, the
appropriate local, state, federal or foreign regulatory agencies or bodies which are
necessary or desirable for the ownership of their respective properties or the conduct of
their respective businesses as described in the General Disclosure Package and the
Prospectus (collectively, the “Governmental Permits”) except where any failures to possess
or make the same, singularly or in the aggregate, would not have a Material Adverse Effect.
The Company and its subsidiaries are in material compliance with all such Governmental
Permits; all such Governmental Permits are valid and in full force and effect, except where
the validity or failure to be in full force and effect would not, singularly or in the
aggregate, have a Material Adverse Effect. All such Governmental Permits are free and clear
of any restriction or condition that are in addition to, or materially different from those
normally applicable to similar licenses, certificates, authorizations and permits. Neither
the Company nor any subsidiary has received notification of any revocation or modification
(or proceedings related thereto) of any such Governmental Permit and the Company has no
reason to believe that any such Governmental Permit will not be renewed.
(s) Neither the Company nor any of its subsidiaries is or, after giving effect to the
offering of the Shares and the application of the proceeds thereof as described in the
General Disclosure Package and the Prospectus, will become an “investment company” within
the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations
of the Commission thereunder.
(t) Neither the Company, its subsidiaries nor, to the Company’s knowledge, any of the
Company’s or its subsidiaries’ officers, directors or affiliates has taken or will take,
directly or indirectly, any action designed or intended to stabilize or manipulate the price
of any security of the Company, or which caused or resulted in, or which might in the future
reasonably be expected to cause or result in, stabilization or manipulation of the price of
any security of the Company.
(u) The Company and its subsidiaries own or possess the right to use all patents,
trademarks, trademark registrations, service marks, service ▇▇▇▇ registrations, trade names,
copyrights, licenses, inventions, software, databases, know-how, Internet domain names,
trade secrets and other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures, and other intellectual property (collectively,
“Intellectual Property”) necessary to carry on their respective businesses as currently
conducted, and as proposed to be conducted and described in the General Disclosure Package
and the Prospectus, and the Company is not aware of any claim to the contrary or any
challenge by any other person to the rights of the Company and its subsidiaries with respect
to the foregoing except for those that could not have a Material Adverse Effect. The
Intellectual Property licenses described in the General Disclosure Package and the
Prospectus are valid, binding upon, and enforceable by or against the parties thereto in
accordance to its terms. The Company and each of its subsidiaries have
11
complied in all material respects with, and are not in breach nor have received any
asserted or threatened claim of breach of, any Intellectual Property license, and the
Company has no knowledge of any breach or anticipated breach by any other person to any
Intellectual Property license. The Company’s and each of its subsidiaries’ businesses as
now conducted and as proposed to be conducted do not and will not infringe or conflict with
any patents, trademarks, service marks, trade names, copyrights, trade secrets, licenses or
other Intellectual Property or franchise right of any person. No claim has been made
against the Company or any of its subsidiaries alleging the infringement by the Company or
any of its subsidiaries of any patent, trademark, service ▇▇▇▇, trade name, copyright, trade
secret, license in or other intellectual property right or franchise right of any person.
The Company and each of its subsidiaries have taken all reasonable steps to protect,
maintain and safeguard their rights in all Intellectual Property, including the execution of
appropriate nondisclosure and confidentiality agreements. The consummation of the
transactions contemplated by this Agreement will not result in the loss or impairment of or
payment of any additional amounts with respect to, nor require the consent of any other
person in respect of, the Company’s or any of its subsidiaries’ right to own, use or hold
for use any of the Intellectual Property as owned, used or held for use in the conduct of
the businesses as currently conducted. With respect to the use of the software in the
Company’s or any of its subsidiaries’ businesses as they are currently conducted, neither
the Company nor any of its subsidiaries has experienced any material defects in such
software including any material error or omission in the processing of any transactions
other than defects which have been corrected, and to the knowledge of the Company, no such
software contains any device or feature designed to disrupt, disable, or otherwise impair
the functioning of any software or is subject to the terms of any “open source” or other
similar license that provides for the source code of the software to be publicly distributed
or dedicated to the public. The Company and each of its subsidiaries have at all times
complied with all applicable laws relating to privacy, data protection, and the collection
and use of personal information collected, used, or held for use by the Company and any of
its subsidiaries in the conduct of the Company’s and its subsidiaries’ businesses. No
claims have been asserted or threatened against the Company or any of its subsidiaries
alleging a violation of any person’s privacy or personal information or data rights and the
consummation of the transactions contemplated hereby will not breach or otherwise cause any
violation of any law related to privacy, data protection, or the collection and use of
personal information collected, used, or held for use by the Company or any of its
subsidiaries in the conduct of the Company’s or any of its subsidiaries’ businesses. The
Company and each of its subsidiaries take reasonable measures to ensure that such
information is protected against unauthorized access, use, modification, or other misuse.
(v) The Company and each of its subsidiaries have good and marketable title in fee
simple to, or have valid rights to lease or otherwise use, all items of real or personal
property which are material to the business of the Company and its subsidiaries taken as a
whole, in each case free and clear of all liens, encumbrances, security interests, claims
and defects that do not, singularly or in the aggregate, materially affect the value of such
property and do not interfere with the use made and proposed to be made of such property by
the Company or any of its subsidiaries; and all of the leases and subleases material to the
business of the Company and its subsidiaries, considered as one
12
enterprise, and under which the Company or any of its subsidiaries hold properties
described in the General Disclosure Package and the Prospectus, are in full force and
effect, and neither the Company nor any subsidiary has received any notice of any material
claim of any sort that has been asserted by anyone adverse to the rights of the Company or
any subsidiary under any of the leases or subleases mentioned above, or affecting or
questioning the rights of the Company or such subsidiary to the continued possession of the
leased or subleased premises under any such lease or sublease.
(w) There is no document, contract, permit or instrument, affiliate transaction or
off-balance sheet transaction (including, without limitation, any “variable interests” in
“variable interest entities,” as such terms are defined in Financial Accounting Standards
Board Interpretation No. 46) of a character required to be described in the Registration
Statement, the Pricing Prospectus or the Prospectus or to be filed as an exhibit to the
Registration Statement that is not so described or filed as required.
(x) No labor disturbance by the employees of the Company or any of its subsidiaries
exists or, to the best of the Company’s knowledge, is imminent, and the Company is not aware
of any existing or imminent labor disturbance by the employees of any of its or its
subsidiaries’ principal suppliers, manufacturers, customers or contractors, that could
reasonably be expected, singularly or in the aggregate, to have a Material Adverse Effect.
The Company is not aware that any key employee or significant group of employees of the
Company or any subsidiary plans to terminate employment with the Company or any such
subsidiary.
(y) No “prohibited transaction” (as defined in Section 406 of the Employee Retirement
Income Security Act of 1974, as amended, including the regulations and published
interpretations thereunder (“ERISA”), or Section 4975 of the Internal Revenue Code of 1986,
as amended from time to time (the “Code”)) or “accumulated funding deficiency” (as defined
in Section 302 of ERISA) or any of the events set forth in Section 4043(b) of ERISA (other
than events with respect to which the thirty (30)-day notice requirement under Section 4043
of ERISA has been waived) has occurred or could reasonably be expected to occur with respect
to any employee benefit plan of the Company or any of its subsidiaries which could,
singularly or in the aggregate, have a Material Adverse Effect. Each employee benefit plan
of the Company or any of its subsidiaries is in compliance in all material respects with
applicable law, including ERISA and the Code. The Company and its subsidiaries have not
incurred and could not reasonably be expected to incur liability under Title IV of ERISA
with respect to the termination of, or withdrawal from, any pension plan (as defined in
ERISA). Each pension plan for which the Company or any of its subsidiaries would have any
liability that is intended to be qualified under Section 401(a) of the Code is so qualified,
and nothing has occurred, whether by action or by failure to act, which could, singularly or
in the aggregate, cause the loss of such qualification.
(z) The Company and its subsidiaries are in compliance with all foreign, federal, state
and local rules, laws and regulations relating to the use, treatment, storage and disposal
of hazardous or toxic substances or waste and protection of health and safety or the
environment which are applicable to their businesses (“Environmental Laws”),
13
except where the failure to comply would not reasonably likely be expected to,
singularly or in the aggregate, have a Material Adverse Effect. There has been no storage,
generation, transportation, handling, treatment, disposal, discharge, emission, or other
release of any kind of toxic or other wastes or other hazardous substances by, due to, or
caused by the Company or any of its subsidiaries (or, to the Company’s knowledge, any other
entity for whose acts or omissions the Company or any of its subsidiaries is or may
otherwise be liable) upon any of the property now or previously owned or leased by the
Company or any of its subsidiaries, or upon any other property, in violation of any law,
statute, ordinance, rule, regulation, order, judgment, decree or permit or which would,
under any law, statute, ordinance, rule (including rule of common law), regulation, order,
judgment, decree or permit, give rise to any liability, except for any violation or
liability which would not have, singularly or in the aggregate with all such violations and
liabilities, a Material Adverse Effect; and there has been no disposal, discharge, emission
or other release of any kind onto such property or into the environment surrounding such
property of any toxic or other wastes or other hazardous substances with respect to which
the Company or any of its subsidiaries has knowledge, except for any such disposal,
discharge, emission, or other release of any kind which would not have, singularly or in the
aggregate with all such discharges and other releases, a Material Adverse Effect. Neither
the Company nor any of its subsidiaries has received any notice from any governmental
authority or third party of an asserted claim under Environmental Laws. In the ordinary
course of business, the Company and its subsidiaries conduct periodic reviews of the effect
of Environmental Laws on their business and assets, in the course of which they identify and
evaluate associated costs and liabilities (including, without limitation, any capital or
operating expenditures required for clean-up, closure of properties or compliance with
Environmental Laws or Governmental Permits issued thereunder, any related constraints on
operating activities and any potential liabilities to third parties). On the basis of such
reviews, the Company and its subsidiaries have reasonably concluded that such associated
costs and liabilities would not have, singularly or in the aggregate, a Material Adverse
Effect.
(aa) The Company and each of its subsidiaries (i) have timely filed all necessary
federal, state, local and foreign tax returns, and all such returns were true, complete and
correct, (ii) have paid all federal, state, local and foreign taxes, assessments,
governmental or other charges due and payable for which they are liable, including, without
limitation, all sales and use taxes and all taxes which the Company or any of its
subsidiaries is obligated to withhold from amounts owing to employees, creditors and third
parties, and (iii) do not have any tax deficiency or claims outstanding or assessed or, to
the best of their knowledge, proposed against any of them, except those, in each of the
cases described in clauses (i), (ii) and (iii) of this paragraph (aa), that would not,
singularly or in the aggregate, have a Material Adverse Effect. The Company and its
subsidiaries each have not engaged in any transaction which is a corporate tax shelter or
which is reasonably likely to be characterized as such by the Internal Revenue Service or
any other taxing authority. The accruals and reserves on the books and records of the
Company and its subsidiaries in respect of tax liabilities for any taxable period not yet
finally determined are adequate to meet any assessments and related liabilities for any such
period, and since December 31, 2008 the Company and its subsidiaries each have not incurred
any liability for taxes other than in the ordinary course.
14
(bb) The Company and each of its subsidiaries carry, or are covered by, insurance
provided by recognized and reputable institutions with policies in such amounts and covering
such risks as is adequate for the conduct of their respective businesses and the value of
their respective properties and as is customary for companies engaged in similar businesses
in similar industries. The Company has no reason to believe that it or any subsidiary will
not be able (i) to renew its existing insurance coverage as and when such policies expire or
(ii) to obtain comparable coverage from similar institutions as may be necessary or
appropriate to conduct its business as now conducted and at a cost that would not result in
a Material Adverse Effect. Neither the Company nor any of its subsidiaries have been denied
any insurance coverage that they have sought or for which they have applied.
(cc) The Company and its subsidiaries each maintain a system of internal accounting and
other controls sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management’s general or specific authorizations; (ii)
transactions are recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management’s general or specific authorization; and (iv)
the recorded accountability for assets is compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any differences. Except as
described in the General Disclosure Package, since the end of the Company’s most recent
audited fiscal year, there as been (A) no material weakness in the Company’s internal
control over financial reporting (whether or not remediated) and (B) no change in the
Company’s internal control over financial reporting that has materially affected, or is
reasonably likely to materially affect, the Company’s internal control over financial
reporting.
(dd) The Company maintains disclosure controls and procedures (as defined in
Rule 13a-14(c) under the Exchange Act); such disclosure controls and procedures have been
designed to ensure that material information relating to the Company and its subsidiaries is
made known to the Company’s principal executive officer and principal financial officer by
others within the Company; and such disclosure controls and procedures are effective.
(ee) There are no affiliations or associations between any member of FINRA and any of
the Company’s officers, directors, or 5% or greater security-holders, except as set forth in
the Registration Statement and the Prospectus.
(ff) The minute books of the Company and each of its subsidiaries that would be a
“significant subsidiary” within the meaning of Rule 1-02(w) of Regulation S-X under the
Exchange Act (such a significant subsidiary of the Company, a “Significant Subsidiary”) have
been made available to the Placement Agent and counsel for the Placement Agent, and such
books (i) contain a complete summary in all material respects of all meetings and actions of
the board of directors (including each board committee) and shareholders of the Company (or
analogous governing bodies and interest holders, as applicable), and each of its Significant
Subsidiaries since the time of its respective
15
incorporation or organization through the date of the latest meeting and action, and
(ii) accurately in all material respects reflect all transactions referred to in such
minutes.
(gg) There is no franchise, lease, contract, agreement or document required by the
Securities Act or by the Rules and Regulations to be described in the General Disclosure
Package and in the Prospectus or a document incorporated by reference therein or to be filed
as an exhibit to the Registration Statement or a document incorporated by reference therein
which is not described or filed therein as required; and all descriptions of any such
franchises, leases, contracts, agreements or documents contained in the Registration
Statement or in a document incorporated by reference therein are accurate and complete
descriptions of such documents in all material respects. Other than as described in the
General Disclosure Package, no such franchise, lease, contract or agreement has been
suspended or terminated for convenience or default by the Company or any of its subsidiaries
or any of the other parties thereto, and neither the Company nor any of its subsidiaries has
received notice nor does the Company have any other knowledge of any such pending or
threatened suspension or termination, except for such pending or threatened suspensions or
terminations that would not reasonably be expected to, singularly or in the aggregate, have
a Material Adverse Effect.
(hh) No relationship, direct or indirect, exists between or among the Company and any
of its subsidiaries on the one hand, and the directors, officers, stockholders (or analogous
interest holders), customers or suppliers of the Company or any of its subsidiaries or any
of their affiliates on the other hand, which is required to be described in the General
Disclosure Package and the Prospectus or a document incorporated by reference therein and
which is not so described.
(ii) No person or entity has the right to require registration of shares of Common
Stock or other securities of the Company or any of its subsidiaries because of the filing or
effectiveness of the Registration Statement or otherwise, except for persons and entities
who have expressly waived such right in writing or who have been given timely and proper
written notice and have failed to exercise such right within the time or times required
under the terms and conditions of such right. Except as described in the General Disclosure
Package, there are no persons with registration rights or similar rights to have any
securities registered by the Company or any of its subsidiaries under the Securities Act.
(jj) Neither the Company nor any of its subsidiaries owns any “margin securities” as
that term is defined in Regulation U of the Board of Governors of the Federal Reserve System
(the “Federal Reserve Board”), and none of the proceeds of the sale of the Shares will be
used, directly or indirectly, for the purpose of purchasing or carrying any margin security,
for the purpose of reducing or retiring any indebtedness which was originally incurred to
purchase or carry any margin security or for any other purpose which might cause any of the
Shares to be considered a “purpose credit” within the meanings of Regulation T, U or X of
the Federal Reserve Board.
(kk) Neither the Company nor any of its subsidiaries is a party to any contract,
agreement or understanding with any person that would give rise to a valid claim against
16
the Company or the Placement Agent for a brokerage commission, finder’s fee or like
payment in connection with the offering and sale of the Shares or any transaction
contemplated by this Agreement, the Registration Statement, the General Disclosure Package
or the Prospectus.
(ll) No forward-looking statement (within the meaning of Section 27A of the Securities
Act and Section 21E of the Exchange Act) contained in either the General Disclosure Package
or the Prospectus has been made or reaffirmed without a reasonable basis or has been
disclosed other than in good faith.
(mm) The Company is subject to and in compliance in all material respects with the
reporting requirements of Section 13 or Section 15(d) of the Exchange Act. The Common Stock
is registered pursuant to Section 12(b) of the Exchange Act and is listed on the Nasdaq
Global Market (the “Nasdaq GM”), and the Company has taken no action designed to, or
reasonably likely to have the effect of, terminating the registration of the Common Stock
under the Exchange Act or delisting the Common Stock from the Nasdaq GM, nor has the Company
received any notification that the Commission or Nasdaq GM or is contemplating terminating
such registration or listing. No consent, approval, authorization or order of, or filing,
notification or registration with, the Nasdaq GM is required for the listing and trading of
the Common Stock on the Nasdaq GM, except for (i) a Notification Form: Listing of Additional
Shares and (ii) a Notification Form: Change in the Number of Shares Outstanding.
(nn) The Company is in compliance with all applicable provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Act of 2002 and all rules and regulations promulgated thereunder or implementing the
provisions thereof (the “▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act”).
(oo) The Company is in compliance with all applicable corporate governance requirements
set forth in the Nasdaq Marketplace Rules that are then in effect.
(pp) Neither the Company nor any of its subsidiaries nor, to the best of the Company’s
knowledge, any employee or agent of the Company or any subsidiary, has made any contribution
or other payment to any official of, or candidate for, any federal, state, local or foreign
office in violation of any law (including the Foreign Corrupt Practices Act of 1977, as
amended) or of the character required to be disclosed in the Registration Statement, the
General Disclosure Package or the Prospectus or a document incorporated by reference
therein.
(qq) There are no transactions, arrangements or other relationships between and/or
among the Company, any of its affiliates (as such term is defined in Rule 405 of the
Securities Act) and any unconsolidated entity, including, but not limited to, any structure
finance, special purpose or limited purpose entity that could reasonably be expected to
materially affect the Company’s or any of its subsidiaries’ liquidity or the availability of
or requirements for their capital resources required to be described in the General
Disclosure Package and the Prospectus or a document incorporated by reference therein which
have not been described as required.
17
(rr) There are no outstanding loans, advances (except normal advances for business
expenses in the ordinary course of business) or guarantees or indebtedness by the Company or
any of its subsidiaries to or for the benefit of any of the officers or directors of the
Company, any of its subsidiaries or any of their respective family members, except as
disclosed in the Registration Statement, the General Disclosure Package and the Prospectus.
(ss) The statistical and market related data included in the Registration Statement,
the General Disclosure Package and the Prospectus are based on or derived from sources that
the Company believes to be reliable and accurate, and such data agree in all material
respects with the sources from which they are derived.
(tt) The operations of the Company and its subsidiaries are and have been conducted at
all times in compliance with applicable financial recordkeeping and reporting requirements
of the Currency and Foreign Transactions Reporting Act of 1970, as amended, applicable money
laundering statutes and applicable rules and regulations thereunder (collectively, the
“Money Laundering Laws”), and no action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the Company or any of its
subsidiaries with respect to the Money Laundering Laws is pending, or to the best knowledge
of the Company, threatened.
(uu) Neither the Company nor any of its subsidiaries nor, to the knowledge of the
Company, any director, officer, agent, employee or affiliate of the Company or any of its
subsidiaries is currently subject to any U.S. sanctions administered by the Office of
Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the Company will not
directly or indirectly use the proceeds of the offering, or lend, contribute or otherwise
make available such proceeds to any subsidiary, joint venture partner or other person or
entity, for the purpose of financing the activities of any person currently subject to any
U.S. sanctions administered by OFAC.
(vv) Neither the Company nor any subsidiary nor any of their affiliates (within the
meaning of FINRA Conduct Rule 2720(b)(1)(a)) directly or indirectly controls, are controlled
by, or is under common control with, or is an associated person (within the meaning of
Article I, Section 1(ee) of the By-laws of FINRA) of, any member firm of FINRA.
(ww) The Company satisfies the pre-1992 eligibility requirements for the use of a
registration statement on Form S-3 in connection with the Offering contemplated thereby (the
pre-1992 eligibility requirements for the use of the registration statement on Form S-3
include (i) having a non-affiliate, public common equity float of at least $150 million, or
a non-affiliate, public common equity float of at least $100 million and annual trading
volume of at least three million shares and (ii) having been subject to the Exchange Act
reporting requirements for a period of 36 months).
(xx) No approval of the shareholders of the Company under the rules and regulations of
Nasdaq (including Rule 5635 of the Nasdaq Listing Rules) is required for the Company to
issue and deliver to the Purchasers the Shares.
18
Any certificate signed by or on behalf of the Company and delivered to the Placement Agent or to
counsel for the Placement Agent shall be deemed to be a representation and warranty by the Company
to the Placement Agent and the Purchasers as to the matters covered thereby.
19
3. The Closing. The time and date of closing and delivery of the documents
required to be delivered to the Placement Agent pursuant to Sections 4 and
6 hereof shall be at 10:00 A.M., New York time, on June 26, 2009 (the
“Closing Date”) at the office of ▇▇▇ ▇▇▇▇▇▇ LLP, ▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇.
4. Further Agreements Of The Company. The Company agrees with the
Placement Agent and the Purchasers:
(a) To prepare the Rule 462(b) Registration Statement, if necessary, in a form approved
by the Placement Agent and file such Rule 462(b) Registration Statement with the Commission
on the date hereof; to prepare the Prospectus in a form approved by the Placement Agent
containing information previously omitted at the time of effectiveness of the Registration
Statement in reliance on rules 430A, 430B and 430C and to file such Prospectus pursuant to
Rule 424(b) of the Rules and Regulations not later than the second (2nd) business
day following the execution and delivery of this Agreement or, if applicable, such earlier
time as may be required by Rule 430A of the Rules and Regulations; to notify the Placement
Agent immediately of the Company’s intention to file or prepare any supplement or amendment
to any Registration Statement or to the Prospectus and to make no amendment or supplement to
the Registration Statement, the General Disclosure Package or to the Prospectus to which the
Placement Agent shall reasonably object by notice to the Company after a reasonable period
to review; to advise the Placement Agent, promptly after it receives notice thereof, of the
time when any amendment to any Registration Statement has been filed or becomes effective or
any supplement to the General Disclosure Package or the Prospectus or any amended Prospectus
has been filed and to furnish the Placement Agent copies thereof; to file promptly all
material required to be filed by the Company with the Commission pursuant to Rule 433(d) or
163(b)(2), as the case may be; to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the
Prospectus and for so long as the delivery of a prospectus (or in lieu thereof, the notice
referred to in Rule 173(a) of the Rules and Regulations) is required in connection with the
offering or sale of the Shares; to advise the Placement Agent, promptly after it receives
notice thereof, of the issuance by the Commission of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus, any Issuer Free Writing
Prospectus or the Prospectus, of the suspension of the qualification of the Shares for
offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for
any such purpose, or of any request by the Commission for the amending or supplementing of
the Registration Statement, the General Disclosure Package or the Prospectus or for
additional information; and, in the event of the issuance of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus, any Issuer Free Writing
Prospectus or the Prospectus or suspending any such qualification, and promptly to use its
best efforts to obtain the withdrawal of such order.
(b) The Company represents and agrees that, unless it obtains the prior consent of the
Placement Agent, it has not made and will not, make any offer relating to the Shares that
would constitute a “free writing prospectus” as defined in Rule 405 of the
20
Rules and Regulations unless the prior written consent of the Placement Agent has been
received (each, a “Permitted Free Writing Prospectus”); provided that the prior written
consent of the Placement Agent hereto shall be deemed to have been given in respect of the
Issuer Free Writing Prospectus(es) included in Schedule A hereto. The Company
represents that it has treated and agrees that it will treat each Permitted Free Writing
Prospectus as an Issuer Free Writing Prospectus, comply with the requirements of Rules 164
and 433 of the Rules and Regulations applicable to any Issuer Free Writing Prospectus,
including the requirements relating to timely filing with the Commission, legending and
record keeping and will not take any action that would result in the Placement Agent or the
Company being required to file with the Commission pursuant to Rule 433(d) of the Rules and
Regulations a free writing prospectus prepared by or on behalf of such Placement Agent that
such Placement Agent otherwise would not have been required to file thereunder.
(c) If at any time when a Prospectus relating to the Shares is required to be delivered
under the Securities Act, any event occurs or condition exists as a result of which the
Prospectus, as then amended or supplemented, would include any untrue statement of a
material fact or omit to state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not misleading, or the
Registration Statement, as then amended or supplemented, would include any untrue statement
of a material fact or omit to state a material fact necessary to make the statements therein
not misleading, or if for any other reason it is necessary at any time to amend or
supplement any Registration Statement or the Prospectus to comply with the Securities Act or
the Exchange Act, the Company will promptly notify the Placement Agent, and upon the
Placement Agent’s request, the Company will promptly prepare and file with the Commission,
at the Company’s expense, an amendment to the Registration Statement or an amendment or
supplement to the Prospectus that corrects such statement or omission or effects such
compliance and will deliver to the Placement Agent, without charge, such number of copies
thereof as the Placement Agent may reasonably request. The Company consents to the use of
the Prospectus or any amendment or supplement thereto by the Placement Agent.
(d) If the General Disclosure Package is being used to solicit offers to buy the Shares
at a time when the Prospectus is not yet available to prospective purchasers and any event
shall occur as a result of which, in the judgment of the Company or in the reasonable
opinion of the Placement Agent, it becomes necessary to amend or supplement the General
Disclosure Package in order to make the statements therein, in the light of the
circumstances then prevailing, not misleading, or to make the statements therein not
conflict with the information contained or incorporated by reference in the Registration
Statement then on file and not superseded or modified, or if it is necessary at any time to
amend or supplement the General Disclosure Package to comply with any law, the Company
promptly will either (i) prepare, file with the Commission (if required) and furnish to the
Placement Agent and any dealers an appropriate amendment or supplement to the General
Disclosure Package or (ii) prepare and file with the Commission an appropriate filing under
the Exchange Act which shall be incorporated by reference in the General Disclosure Package
so that the General Disclosure Package as so amended or supplemented will not, in the light
of the circumstances then prevailing, be
21
misleading or conflict with the Registration Statement then on file, or so that the
General Disclosure Package will comply with law.
(e) If at any time following issuance of an Issuer Free Writing Prospectus there
occurred or occurs an event or development as a result of which such Issuer Free Writing
Prospectus conflicted or will conflict with the information contained in the Registration
Statement, Pricing Prospectus or Prospectus, including any document incorporated by
reference therein and any prospectus supplement deemed to be a part thereof and not
superseded or modified or included or would include an untrue statement of a material fact
or omitted or would omit to state a material fact required to be stated therein or necessary
in order to make the statements therein, in the light of the circumstances prevailing at the
subsequent time, not misleading, the Company has promptly notified or will promptly notify
the Placement Agent so that any use of the Issuer Free Writing Prospectus may cease until it
is amended or supplemented and has promptly amended or will promptly amend or supplement, at
its own expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict,
untrue statement or omission. The foregoing sentence does not apply to statements in or
omissions from any Issuer Free Writing Prospectus in reliance upon, and in conformity with,
written information furnished to the Company by the Placement Agent specifically for
inclusion therein, which information the parties hereto agree is limited to the Placement
Agent’s Information.
(f) Upon request of the Placement Agent, to furnish promptly to the Placement Agent and
to counsel for the Placement Agent a signed copy of the Registration Statement as originally
filed with the Commission, and of each amendment thereto filed with the Commission,
including all consents and exhibits filed therewith.
(g) To deliver promptly to the Placement Agent in New York City such number of the
following documents as the Placement Agent shall reasonably request: (i) conformed copies
of the Registration Statement as originally filed with the Commission (in each case
excluding exhibits), (ii) any Preliminary Prospectus, (iii) any Issuer Free Writing
Prospectus, (iv) the Prospectus (the delivery of the documents referred to in clauses (i),
(ii), (iii) and (iv) of this paragraph (g) to be made not later than 10:00 A.M., New York
time, on the business day following the execution and delivery of this Agreement), (v)
conformed copies of any amendment to the Registration Statement (excluding exhibits), (vi)
any amendment or supplement to the General Disclosure Package or the Prospectus (the
delivery of the documents referred to in clauses (v) and (vi) of this paragraph (g) to be
made not later than 10:00 A.M., New York City time, on the business day following the date
of such amendment or supplement) and (vii) any document incorporated by reference in the
General Disclosure Package or the Prospectus (excluding exhibits thereto) (the delivery of
the documents referred to in clause (vi) of this paragraph (g) to be made not later than
10:00 A.M., New York City time, on the business day following the date of such document).
(h) To make generally available to its shareholders as soon as practicable, but in any
event not later than eighteen (18) months after the effective date of each Registration
Statement (as defined in Rule 158(c) of the Rules and Regulations), an
22
earnings statement of the Company and its subsidiaries (which need not be audited)
complying with Section 11(a) of the Securities Act and the Rules and Regulations (including,
at the option of the Company, Rule 158); and to furnish to its shareholders as soon as
practicable after the end of each fiscal year an annual report (including a balance sheet
and statements of income, shareholders’ equity and cash flows of the Company and its
consolidated subsidiaries certified by independent public accountants) and as soon as
possible after each of the first three fiscal quarters of each fiscal year (beginning with
the first fiscal quarter after the effective date of such Registration Statement),
consolidated summary financial information of the Company and its subsidiaries for such
quarter in reasonable detail.
(i) To take promptly from time to time such actions as the Placement Agent may
reasonably request to qualify the Shares for offering and sale under the securities or Blue
Sky laws of such jurisdictions (domestic or foreign) as the Placement Agent may designate
and to continue such qualifications in effect, and to comply with such laws, for so long as
required to permit the offer and sale of Shares in such jurisdictions; provided that the
Company and its subsidiaries shall not be obligated to qualify as foreign corporations in
any jurisdiction in which they are not so qualified or to file a general consent to service
of process in any jurisdiction.
(j) Upon request, during the period of five (5) years from the date hereof, to the
extent not available on the Commission’s ▇▇▇▇▇ system, to deliver to the Placement Agent,
(i) as soon as they are available, copies of all reports or other communications furnished
to shareholders, and (ii) as soon as they are available, copies of any reports and financial
statements furnished or filed with the Commission or any national securities exchange or
automatic quotation system on which the Shares are listed or quoted.
(k) That the Company will not, for a period of ninety (90) days from the date of the
Prospectus, (the “Lock-Up Period”) without the prior written consent of ▇▇▇▇▇▇▇, directly or
indirectly offer, sell, assign, transfer, pledge, contract to sell, or otherwise dispose of,
any shares of Common Stock or any securities convertible into or exercisable or exchangeable
for Common Stock, other than the Company’s sale of the Shares hereunder and the issuance of
restricted Common Stock or options to acquire Common Stock pursuant to the Company’s
employee benefit plans, qualified stock option plans or other employee compensation plans as
such plans are in existence on the date hereof and described in the Prospectus and the
issuance of Common Stock pursuant to the valid exercises of options, warrants or rights
outstanding on the date hereof. The Company will cause each executive officer, director,
shareholder, optionholder and warrantholder listed in Schedule B to furnish to the
Placement Agent, prior to the Closing Date, a letter, substantially in the form of
Exhibit B hereto, pursuant to which each such person shall agree, among other
things, not to directly or indirectly offer, sell, assign, transfer, pledge, contract to
sell, or otherwise dispose of, any shares of Common Stock or any securities convertible into
or exercisable or exchangeable for Common Stock, not to engage in any swap or other
agreement or arrangement that transfers, in whole or in part, directly or indirectly, the
economic risk of ownership of Common Stock or any such securities and not to engage in any
short selling of any Common Stock or any such securities, during the Lock-Up Period, without
the prior written consent of ▇▇▇▇▇▇▇.
23
The Company also agrees that during such period, the Company will not file any
registration statement, preliminary prospectus or prospectus, or any amendment or supplement
thereto, under the Securities Act for any such transaction or which registers, or offers for
sale, Common Stock or any securities convertible into or exercisable or exchangeable for
Common Stock, except for a registration statement on Form S-8 relating to employee benefit
plans. The Company hereby agrees that (i) if it issues an earnings release or material
news, or if a material event relating to the Company occurs, during the last seventeen (17)
days of the Lock-Up Period, or (ii) if prior to the expiration of the Lock-Up Period, the
Company announces that it will release earnings results during the sixteen (16)-day period
beginning on the last day of the Lock-Up Period, the restrictions imposed by this paragraph
(k) or the letter shall continue to apply until the expiration of the eighteen (18)-day
period beginning on the issuance of the earnings release or the occurrence of the material
news or material event.
(l) To supply the Placement Agent with copies of all correspondence to and from, and
all documents issued to and by, the Commission in connection with the registration of the
Shares under the Securities Act or the Registration Statement, any Preliminary Prospectus or
the Prospectus, or any amendment or supplement thereto or document incorporated by reference
therein.
(m) Prior to the Closing Date, to furnish to the Placement Agent, as soon as they have
been prepared, copies of any unaudited interim consolidated financial statements of the
Company for any periods subsequent to the periods covered by the financial statements
appearing in the Registration Statement and the Prospectus.
(n) Prior to the Closing Date, not to issue any press release or other communication
directly or indirectly or hold any press conference with respect to the Company, its
condition, financial or otherwise, or earnings, business affairs or business prospects
(except for routine oral marketing communications in the ordinary course of business and
consistent with the past practices of the Company and of which the Placement Agent is
notified), without prior written notice to and consent of the Placement Agent, unless in the
judgment of the Company and its counsel, and after notification to the Placement Agent, such
press release or communication is required by law.
(o) Until the Placement Agent shall have notified the Company of the completion of the
offering of the Shares, that the Company will not, and will cause its affiliated purchasers
(as defined in Regulation M under the Exchange Act) not to, either alone or with one or more
other persons, bid for or purchase, for any account in which it or any of its affiliated
purchasers has a beneficial interest, any Shares, or attempt to induce any person to
purchase any Shares; and not to, and to cause its affiliated purchasers not to, make bids or
purchase for the purpose of creating actual, or apparent, active trading in or of raising
the price of the Shares.
(p) Not to take any action prior to the Closing Date that would require the Prospectus
to be amended or supplemented pursuant to Section 4(c).
24
(q) To at all times comply with all applicable provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act in
effect from time to time.
(r) To apply the net proceeds from the sale of the Shares as set forth in the
Registration Statement, the General Disclosure Package and the Prospectus under the heading
“Use of Proceeds.”
(s) To use its best efforts to list, subject to notice of issuance, the Shares on the
Nasdaq GM, and effect and maintain the quotation of the Shares on the Nasdaq GM.
(t) To use its best efforts to do and perform all things required to be done or
performed under this Agreement by the Company prior to the Closing Date and to satisfy all
conditions precedent to the delivery of the Shares.
5. Payment of Expenses. The Company agrees to pay, or reimburse if paid by
the Placement Agent, whether or not the transactions contemplated hereby are
consummated or this Agreement is terminated: (a) the costs incident to the
authorization, issuance, sale, preparation and delivery of the Shares to the
Purchasers and any taxes payable in that connection; (b) the costs incident to the
Registration of the Shares under the Securities Act; (c) the costs incident to the
preparation, printing and distribution of the Registration Statement, the Base
Prospectus, any Preliminary Prospectus, any Issuer Free Writing Prospectus, the
General Disclosure Package, the Prospectus, any amendments, supplements and exhibits
thereto or any document incorporated by reference therein and the costs of printing,
reproducing and distributing any transaction document by mail, telex or other means
of communications; (d) the fees and expenses incurred in connection with securing
any required review by FINRA of the terms of the sale of the Shares and any filings
made with FINRA; (e) any applicable listing, quotation or other fees; (f) the fees
and expenses (including related fees and expenses of counsel to the Placement Agent)
of qualifying the Shares under the securities laws of the several jurisdictions as
provided in Section 4(i) and of preparing, printing and distributing
wrappers, Blue Sky Memoranda and Legal Investment Surveys; (g) the cost of preparing
and printing stock certificates; (h) all fees and expenses of the registrar and
transfer agent of the Shares; (i) the fees, disbursements and expenses of counsel to
the Placement Agent, not to exceed $25,000, (j) the reasonable out of pocket costs
and expenses incurred by the Placement Agent (excluding the fees, disbursements and
expenses of counsel to the Placement Agent) as previously provided in Section 7 of
the letter agreement, dated February 26, 2009 (the “Engagement Letter”) between the
Company and the Placement Agent, and (k) all other costs and expenses incident to
the offering of the Shares or the performance of the obligations of the Company
under this Agreement (including, without limitation, the fees and expenses of the
Company’s counsel and the Company’s independent accountants and the travel and other
expenses incurred by Company personnel in connection with any “road show” including,
without limitation, any expenses advanced by the Placement Agent on the Company’s
behalf (which will be promptly reimbursed.).
25
6. Conditions to the Obligations of the Placement Agent and the Purchasers,
and the Sale of the Shares. The respective obligations of the Placement Agent
hereunder and the Purchasers under the Subscription Agreements, and the Closing of
the sale of the Shares, are subject to the accuracy, when made and as of the
Applicable Time and on the Closing Date, of the representations and warranties of
the Company contained herein, to the accuracy in all material respects (except that
any representation and warranty that is qualified as to materiality shall be true
and correct in all respects) of the statements of the Company made in any
certificates pursuant to the provisions hereof, to the performance by the Company of
its obligations hereunder, and to each of the following additional terms and
conditions:
(a) No stop order suspending the effectiveness of the Registration Statement or any
part thereof, preventing or suspending the use of any Base Prospectus, any Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus or any part thereof
shall have been issued and no proceedings for that purpose or pursuant to Section 8A under
the Securities Act shall have been initiated or threatened by the Commission, and all
requests for additional information on the part of the Commission (to be included or
incorporated by reference in the Registration Statement or the Prospectus or otherwise)
shall have been complied with to the reasonable satisfaction of the Placement Agent; the
Rule 462(b) Registration Statement, if any, each Issuer Free Writing Prospectus, if any, and
the Prospectus shall have been filed with the Commission within the applicable time period
prescribed for such filing by, and in compliance with, the Rules and Regulations and in
accordance with Section 4(a), and the Rule 462(b) Registration Statement, if any,
shall have become effective immediately upon its filing with the Commission; and FINRA shall
have raised no objection to the fairness and reasonableness of the terms of this Agreement
or the transactions contemplated hereby.
(b) The Placement Agent shall not have discovered and disclosed to the Company on or
prior to the Closing Date that the Registration Statement or any amendment or supplement
thereto contains an untrue statement of a fact which, in the opinion of counsel for the
Placement Agent, is material or omits to state any fact which, in the opinion of such
counsel, is material and is required to be stated therein or is necessary to make the
statements therein not misleading, or that the General Disclosure Package, any Issuer Free
Writing Prospectus or the Prospectus or any amendment or supplement thereto contains an
untrue statement of fact which, in the opinion of such counsel, is material or omits to
state any fact which, in the opinion of such counsel, is material and is necessary in order
to make the statements, in the light of the circumstances in which they were made, not
misleading.
(c) All corporate proceedings and other legal matters incident to the authorization,
form and validity of each of this Agreement, the Subscription Agreements, the Escrow
Agreement, the Shares, the Registration Statement, the General Disclosure Package, each
Issuer Free Writing Prospectus, if any, and the Prospectus and all other legal matters
relating to this Agreement and the transactions contemplated hereby shall be reasonably
satisfactory in all material respects to counsel for the Placement Agent, and
26
the Company shall have furnished to such counsel all documents and information that
they may reasonably request to enable them to pass upon such matters.
(d) ▇▇▇ ▇▇▇▇▇▇ LLP shall have furnished to the Placement Agent such counsel’s written
opinion, as counsel to the Company, addressed to the Placement Agent and dated the Closing
Date, in form and substance reasonably satisfactory to the Placement Agent. Such counsel
shall also have furnished to the Placement Agent a written statement, addressed to the
Placement Agent and dated the Closing Date, in form and substance satisfactory to the
Placement Agent.
(e) The Placement Agent shall have received from Proskauer Rose LLP, counsel for the
Placement Agent, such opinion or opinions, dated the Closing Date, with respect to such
matters as the Placement Agent may reasonably require, and the Company shall have furnished
to such counsel such document as they request for enabling them to pass upon such matters.
(f) The Placement Agent shall have received from Pillsbury ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ LLP,
counsel for the Placement Agent, such negative assurances statement, dated the Closing Date,
with respect to such matters as the Placement Agent may reasonably require, and the Company
shall have furnished to such counsel such document as they request for enabling them to pass
upon such matters.
(g) At the time of the execution of this Agreement, the Placement Agent shall have
received from BDO ▇▇▇▇▇▇▇, LLP a letter, addressed to the Placement Agent, executed and
dated such date, in form and substance satisfactory to the Placement Agent (i) confirming
that they are an independent registered accounting firm with respect to the Company and its
subsidiaries within the meaning of the Securities Act and the Rules and Regulations and
PCAOB and (ii) stating the conclusions and findings of such firm, of the type ordinarily
included in accountants’ “comfort letters” to underwriters, with respect to the financial
statements and certain financial information contained or incorporated by reference in the
Registration Statement, the General Disclosure Package and the Prospectus.
(h) At the time of the execution of this Agreement, the Placement Agent shall have
received from PricewaterhouseCoopers, LLP a letter, addressed to the Placement Agent,
executed and dated such date, in form and substance satisfactory to the Placement Agent (i)
confirming that they are an independent registered accounting firm with respect to the
Company and its subsidiaries within the meaning of the Securities Act and the Rules and
Regulations and PCAOB and (ii) stating the conclusions and findings of such firm, of the
type ordinarily included in accountants’ “comfort letters” to underwriters, with respect to
the financial statements and certain financial information contained or incorporated by
reference in the Registration Statement, the General Disclosure Package and the Prospectus.
(i) On the effective date of any post-effective amendment to any Registration Statement
and on the Closing Date, the Placement Agent shall have received a letter (the “Bring-Down
Letter”) from PricewaterhouseCoopers, LLP addressed to the Placement
27
Agent and dated the Closing Date confirming, as of the date of the Bring-Down Letter
(or, with respect to matters involving changes or developments since the respective dates as
of which specified financial information is given in the General Disclosure Package and the
Prospectus, as the case may be, as of a date not more than three (3) business days prior to
the date of the Bring-Down Letter), the conclusions and findings of such firm, of the type
ordinarily included in accountants’ “comfort letters” to underwriters, with respect to the
financial information and other matters covered by its letter delivered to the Placement
Agent concurrently with the execution of this Agreement pursuant to paragraph (h) of this
Section 6.
(j) The Company shall have furnished to the Placement Agent and the Purchasers a
certificate, dated the Closing Date, of its Chairman of the Board, Chief Executive Officer,
its President or a Vice President and its chief financial officer stating that (i) such
officers have carefully examined the Registration Statement, the General Disclosure Package,
any Permitted Free Writing Prospectus and the Prospectus and, in their opinion, the
Registration Statement and each amendment thereto, at the Applicable Time and as of the date
of this Agreement and as of the Closing Date did not include any untrue statement of a
material fact and did not omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and the General Disclosure Package,
as of the Applicable Time and as of the Closing Date, any Permitted Free Writing Prospectus
as of its date and as of the Closing Date, the Prospectus and each amendment or supplement
thereto, as of the respective date thereof and as of the Closing Date, did not include any
untrue statement of a material fact and did not omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances in which they were
made, not misleading, (ii) since the effective date of the Initial Registration Statement,
no event has occurred which should have been set forth in a supplement or amendment to the
Registration Statement, the General Disclosure Package or the Prospectus, (iii) to the best
of their knowledge after reasonable investigation, as of the Closing Date, the
representations and warranties of the Company in this Agreement are true and correct and the
Company has complied with all agreements and satisfied all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing Date, and (iv) there has not
been, subsequent to the date of the most recent audited financial statements included or
incorporated by reference in the General Disclosure Package, any material adverse change in
the financial position or results of operations of the Company and its subsidiaries, or any
change or development that, singularly or in the aggregate, would involve a material adverse
change or a prospective material adverse change, in or affecting the condition (financial or
otherwise), results of operations, business, assets or prospects of the Company and its
subsidiaries taken as a whole, except as set forth in the Prospectus.
(k) Since the date of the latest audited financial statements included in the General
Disclosure Package or incorporated by reference in the General Disclosure Package as of the
date hereof, (i) neither the Company nor any of its subsidiaries shall have sustained any
loss or interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or governmental
action, order or decree, otherwise than as set forth in the General Disclosure Package, and
(ii) there shall not have been any change in the capital stock or
28
long-term debt of the Company or any of its subsidiaries, or any change, or any
development involving a prospective change, in or affecting the business, general affairs,
management, financial position, stockholders’ equity or results of operations of the Company
and its subsidiaries, otherwise than as set forth in the General Disclosure Package, the
effect of which, in any such case described in clause (i) or (ii) of this paragraph (k), is,
in the judgment of the Placement Agent, so material and adverse as to make it impracticable
or inadvisable to proceed with the sale or delivery of the Shares on the terms and in the
manner contemplated in the General Disclosure Package.
(l) No action shall have been taken and no law, statute, rule, regulation or order
shall have been enacted, adopted or issued by any governmental agency or body which would
prevent the issuance or sale of the Shares or materially and adversely affect the business
or operations of the Company; and no injunction, restraining order or order of any other
nature by any federal or state court of competent jurisdiction shall have been issued which
would prevent the issuance or sale of the Shares or materially and adversely affect or
potentially materially and adversely affect the business or operations of the Company.
(m) The Nasdaq GM shall have approved the Shares for listing therein, subject only to
official notice of issuance.
(n) The Placement Agent shall have received the written agreements, substantially in
the form of Exhibit B hereto, of the executive officers, directors, shareholders,
optionholders and warrantholders of the Company listed in Schedule B to this
Agreement.
(o) The Company shall have entered into Subscription Agreements with each of the
Purchasers and such agreements shall be in full force and effect.
(p) The Company shall have entered into the Escrow Agreement and such agreement shall
be in full force and effect..
(q) Prior to the Closing Date, the Company shall have furnished to the Placement Agent
such further information, opinions, certificates (including a Secretary’s Certificate),
letters or documents as the Placement Agent shall have reasonably requested.
All opinions, letters, evidence and certificates mentioned above or elsewhere in this
Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form
and substance reasonably satisfactory to counsel for the Placement Agent.
7. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless the Placement Agent, its affiliates,
and their respective directors, officers, managers, members, employees, representatives and
agents and each person, if any, who controls the Placement Agent within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act (the “Placement Agent
Indemnified Parties”), from and against any and all losses, claims, liabilities, expenses
and damages (including any and all investigative, legal and
29
other expenses reasonably incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claim asserted), to which they, or any
of them, may become subject under the Securities Act, the Exchange Act or other federal or
state statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, liabilities, expenses or damages arise out of or are based on (i) any untrue
statement or alleged untrue statement of a material fact contained in the Registration
Statement, any preliminary prospectus, the Base Prospectus, the Pricing Prospectus, the
Prospectus or any amendment or supplement thereto, or any Issuer Free Writing Prospectus or
any “issuer information” filed or required to be filed pursuant to Rule 433(d) of the Rules
and Regulations, the omission or alleged omission to state in such document a material fact
required to be stated in it or necessary to make the statements in it not misleading in the
light of the circumstances in which they were made, (ii) in whole or in part, any inaccuracy
in the representations and warranties of the Company contained herein, or (iii) any failure
of the Company to perform its obligations hereunder or under law in connection with the
transactions contemplated hereby; provided, however, that the Company will not be liable to
the extent that such loss, claim, liability, expense or damage arises from the sale of the
Shares to any Purchaser and is based on an untrue statement or omission or alleged untrue
statement or omission made in reliance on and in conformity with information relating to the
Placement Agent furnished in writing to the Company by the Placement Agent expressly for
inclusion in the Registration Statement, any preliminary prospectus, the Base Prospectus,
the Pricing Prospectus, the Prospectus, or any Issuer Free Writing Prospectus. The Company
acknowledges that the Placement Agent’s Information in the Pricing Prospectus and the
Prospectus constitutes the only information relating to the Placement Agent furnished in
writing to the Company by the Placement Agent expressly for inclusion in the Registration
Statement, any preliminary prospectus, the Base Prospectus, the Pricing Prospectus, the
Prospectus, or any Issuer Free Writing Prospectus. This indemnity agreement will be in
addition to any liability that the Company might otherwise have.
(b) The Placement Agent will indemnify and hold harmless the Company, each director of
the Company, each officer of the Company who signs the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act (the “Company Indemnified Parties”), to the same
extent as the foregoing indemnity from the Company to the Placement Agent, as set forth in
Section 7(a), but only insofar as losses, claims, liabilities, expenses or damages
arise out of or are based on any untrue statement or omission or alleged untrue statement or
omission made in reliance on and in conformity with information relating to the Placement
Agent furnished in writing to the Company by the Placement Agent expressly for use in any
preliminary prospectus, the Registration Statement, the Base Prospectus, any Prospectus
Supplement, the Prospectus, or any Issuer Free Writing Prospectus. The Company acknowledges
that the Placement Agent’s Information in the Prospectus constitutes the only information
relating to the Placement Agent furnished in writing to the Company by the Placement Agent
expressly for use in any preliminary prospectus, the Registration Statement, the Base
Prospectus, any Prospectus Supplement, the Prospectus, or any Issuer Free Writing
Prospectus. This indemnity will be in addition to any liability that the Placement Agent
might otherwise have.
30
(c) Any party that proposes to assert the right to be indemnified under this
Section 7 shall, promptly after receipt of notice of commencement of any action
against such party in respect of which a claim is to be made against an indemnifying party
or parties under this Section 7, notify each such indemnifying party in writing of
the commencement of such action, enclosing with such notice a copy of all papers served, but
the omission so to notify such indemnifying party will not relieve it from any liability
that it may have to any indemnified party under the foregoing provisions of this Section
7 unless, and only to the extent that, such omission results in the loss of substantive
rights or defenses by the indemnifying party. If any such action is brought against any
indemnified party and it notifies the indemnifying party of its commencement, the
indemnifying party will be entitled to participate in and, to the extent that it elects by
delivering written notice to the indemnified party promptly after receiving notice of the
commencement of the action from the indemnified party, jointly with any other indemnifying
party similarly notified, to assume the defense of the action, with counsel reasonably
satisfactory to the indemnified party. After notice from the indemnifying party to the
indemnified party of its election to assume the defense, the indemnifying party will not be
liable to the indemnified party for any legal or other expenses except as provided below and
except for the reasonable costs of investigation incurred by the indemnified party in
connection with the defense. The indemnified party will have the right to employ its own
counsel in any such action, but the fees, expenses and other charges of such counsel will be
at the expense of such indemnified party, unless (i) the employment of counsel by the
indemnified party has been authorized in writing by the indemnifying party, (ii) the
indemnified party has reasonably concluded (based on written advice of counsel) that there
may be legal defenses available to it or other indemnified parties that are different from
or in addition to those available to the indemnifying party, (iii) a conflict or potential
conflict exists (based on written advice of counsel to the indemnified party) between the
indemnified party and the indemnifying party (in which case the indemnifying party will not
have the right to direct the defense of such action on behalf of the indemnified party) or
(iv) the indemnifying party has not in fact employed counsel reasonably satisfactory to the
indemnified party to assume the defense of such action within a reasonable time after
receiving notice of the commencement of the action, in each of which cases the reasonable
fees, disbursements and other charges of counsel will be at the expense of the indemnifying
party or parties. It is understood that the indemnifying party or parties shall not, in
connection with any proceeding or related proceedings in the same jurisdiction, be liable
for the reasonable fees, disbursements and other charges of more than one separate firm
admitted to practice in such jurisdiction at any one time for all such indemnified party or
parties. All such fees, disbursements and other charges will be reimbursed by the
indemnifying party promptly as they are incurred. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any pending or
threatened action in respect of which any indemnified party is or could have been a party
and indemnity could have been sought hereunder by such indemnified party unless such
settlement (i) includes an unconditional release of such indemnified party from all
liability on any claims that are the subject matter of such action and (ii) does not include
a statement as to, or an admission of, fault, culpability or a failure to act by or on
behalf of an indemnified party. An indemnifying party will not be liable for any settlement
of any action or claim
31
effected without its written consent (which consent will not be unreasonably withheld
or delayed).
(d) If the indemnification provided for in this Section 7 is applicable in
accordance with its terms but for any reason is held to be unavailable to or insufficient to
hold harmless an indemnified party under paragraphs (a), (b) and (c) of this Section
7 in respect of any losses, claims, liabilities, expenses and damages referred to
therein, then each applicable indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable (including any investigative, legal
and other expenses reasonably incurred in connection with, and any amount paid in settlement
of, any action, suit or proceeding or any claim asserted, but after deducting any
contribution received by the Company from persons other than the Placement Agent, such as
persons who control the Company within the meaning of the Securities Act, officers of the
Company who signed the Registration Statement and directors of the Company, who also may be
liable for contribution) by such indemnified party as a result of such losses, claims,
liabilities, expenses and damages in such proportion as shall be appropriate to reflect the
relative benefits received by the Company, on the one hand, and the Placement Agent, on the
other hand. The relative benefits received by the Company, on the one hand, and the
Placement Agent, on the other hand, shall be deemed to be in the same proportion as the
total net proceeds from the offering (before deducting expenses) received by the Company
bear to the total Placement Fee received by the Placement Agent pursuant to this Agreement.
If, but only if, the allocation provided by the foregoing sentence is not permitted by
applicable law, the allocation of contribution shall be made in such proportion as is
appropriate to reflect not only the relative benefits referred to in the foregoing sentence
but also the relative fault of the Company, on the one hand, and the Placement Agent, on the
other hand, with respect to the statements or omissions that resulted in such loss, claim,
liability, expense or damage, or action in respect thereof, as well as any other relevant
equitable considerations with respect to such offering. Such relative fault shall be
determined by reference to whether the untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information supplied by
the Company or the Placement Agent, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such statement or omission. The
Company and the Placement Agent agree that it would not be just and equitable if
contributions pursuant to this Section 7(d) were to be determined by pro rata
allocation or by any other method of allocation that does not take into account the
equitable considerations referred to herein. The amount paid or payable by an indemnified
party as a result of the loss claim, liability, expense or damage, or action in respect
thereof, referred to above in this Section 7(d) shall be deemed to include, for
purposes of this Section 7(d), any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such action or
claim. Notwithstanding the provisions of this Section 7(d), in no case shall the
Placement Agent be required to contribute any amount in excess of the Fee received by the
Placement Agent pursuant to this Agreement. No person found guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 7(d), any person who controls a
party to this Agreement within the meaning of the Securities Act will have the
32
same rights to contribution as that party, and each officer of the Company who signed
the Registration Statement will have the same rights to contribution as the Company, subject
in each case to the provisions hereof. Any party entitled to contribution, promptly after
receipt of notice of commencement of any action against any such party in respect of which a
claim for contribution may be made under this Section 7(d), will notify any such party or
parties from whom contribution may be sought, but the omission so to notify will not relieve
the party or parties from whom contribution may be sought from any other obligation it or
they may have under this Section 7(d). No party will be liable for contribution
with respect to any action or claim settled without its written consent (which consent will
not be unreasonably withheld).
(e) The indemnity and contribution agreements contained in this Section 7 and
the representations and warranties of the Company contained in this Agreement shall remain
operative and in full force and effect regardless of (i) any investigation made by or on
behalf of the Placement Agent, (ii) acceptance by the Purchasers of any of the Shares and
payment therefor, or (iii) any termination of this Agreement.
8. Termination. The obligations of the Placement Agent and the Purchasers
under this Agreement and under the Subscription Agreements may be terminated at any
time on or prior to the Closing Date, by notice to the Company from the Placement
Agent, without liability on the part of the Placement Agent or the Purchasers to the
Company if in the sole judgment of the Placement Agent, (i) trading in any of the
equity securities of the Company shall have been suspended or limited by the
Commission or by the NASDAQ GM, (ii) trading in securities generally on the New York
Stock Exchange or the NASDAQ GM shall have been suspended or limited or minimum or
maximum prices shall have been generally established on such exchange, or additional
material governmental restrictions, not in force on the date of this Agreement,
shall have been imposed upon trading in securities generally by such exchange, by
order of the Commission or any court or other governmental authority, or by the
NASDAQ GM, (iii) a general banking moratorium shall have been declared by either
federal or New York State authorities or any material disruption of the securities
settlement or clearance services in the United States shall have occurred, or
(iv) any material adverse change in the financial or securities markets in the
United States or in political, financial or economic conditions in the United
States, any outbreak or escalation of hostilities involving the United States, a
declaration of a national emergency or war by the United States, or other calamity
or crisis, either within or outside the United States, shall have occurred, the
effect of which is such as to make it, in the sole judgment of the Placement Agent,
impracticable or inadvisable to proceed with completion of the placement of the
Shares on the terms and in the manner contemplated in the General Disclosure Package
and the Prospectus. In addition, the obligations of the Placement Agent and the
Purchasers hereunder and under the Subscription Agreements may be terminated by the
Placement Agent, in its absolute discretion by notice given to the Company prior to
delivery of and payment for the Shares if, prior to that time, any of the events
described in Sections 6(k) and (l) have occurred or if the
Purchasers shall
33
decline to purchase the Shares for any reason permitted under this Agreement or
the Subscription Agreements.
9. Reimbursement of Placement Agent’s Expenses. Notwithstanding anything to
the contrary in this Agreement, if (a) this Agreement shall have been terminated
pursuant to Section 8, (b) the Company shall fail to tender the Shares for
delivery to the Purchasers for any reason not permitted under this Agreement or (c)
the sale of the Shares is not consummated because any condition to the obligations
of the Purchasers or the Placement Agent set forth herein is not satisfied or
because of the refusal, inability or failure on the part of the Company to perform
any agreement herein or to satisfy any condition or to comply with the provisions
hereof, then in addition to the payment of amounts in accordance with Section
5, the Company shall reimburse the Placement Agent for the reasonable fees and
expenses of the Placement Agent’s counsel not to exceed $100,000 and for such other
out-of-pocket expenses as shall have been reasonably incurred by them in connection
with this Agreement and the proposed purchase of the Shares, and upon demand the
Company shall pay the full amount thereof to the Placement Agent.
10. No Fiduciary Relationship. Notwithstanding any preexisting relationship,
advisory or otherwise, between the parties or any oral representations or assurances
previously or subsequently made by the Placement Agent, the Company acknowledges and
agrees that (i) the purchase and sale of the Shares pursuant to this Agreement and
the Subscription Agreements (including the determination of the terms of the
offering of the Shares) is an arm’s-length commercial transaction between the
Company and the several Purchasers, (ii) the Placement Agent has not assumed any
advisory or fiduciary responsibility in favor of the Company with respect to the
offering contemplated hereby or the process leading thereto (irrespective of whether
the Placement Agent has advised or is currently advising the Company on other
matters) or any other obligation to the Company except the obligations expressly set
forth in this Agreement, (iii) the Placement Agent and its affiliates may be engaged
in a broad range of transactions that involve interests that differ from those of
the Company and have no obligation to disclose or account to the Company for any of
such differing interests, and (iv) the Company has consulted its own legal, tax,
accounting and financial advisors to the extent it deemed appropriate. The Company
hereby agrees that it will not claim that the Placement Agent has rendered advisory
services of any nature or respect, or owe a fiduciary or similar duty to the
Company, in connection with such transaction or the process leading thereto.
11. Successors; Persons Entitled to Benefit of Agreement. This Agreement
shall inure to the benefit of and be binding upon the Placement Agent, the Company,
and each of their respective successors and assigns. This Agreement shall also
inure to the benefit of the Purchasers as against the Company, and their respective
successors and assigns, which shall be third party beneficiaries hereof. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to give
any person, other than the persons mentioned in the preceding sentences, any legal
or equitable right, remedy or
34
claim under or in respect of this Agreement, or any provisions herein
contained, this Agreement and all conditions and provisions hereof being intended to
be and being for the sole and exclusive benefit of such persons and for the benefit
of no other person; except that the representations, warranties, covenants,
agreements and indemnities of the Company contained in this Agreement shall also be
for the benefit of the Placement Agent Indemnified Parties and the indemnities of
the Placement Agent shall be for the benefit of the Company Indemnified Parties. It
is understood that the Placement Agent’s responsibility to the Company is solely
contractual in nature and the Placement Agent does not owe the Company, or any other
party, any fiduciary duty as a result of this Agreement.
12. Survival of Indemnities, Representations, Warranties, etc. The respective
indemnities, covenants, agreements, representations, warranties and other statements
of the Company and the Placement Agent, as set forth in this Agreement or made by
them respectively, pursuant to this Agreement, shall remain in full force and
effect, regardless of any investigation made by or on behalf of the Placement Agent,
the Company, the Purchasers or any person controlling any of them and shall survive
delivery of and payment for the Shares. Notwithstanding any termination of this
Agreement, including without limitation any termination pursuant to Sections
8 or 9, the indemnity and contribution agreements contained in
Section 7. and the covenants, representations, warranties set forth in
this Agreement shall not terminate and shall remain in full force and effect at all
times.
13. Notices. All statements, requests, notices and agreements hereunder shall
be in writing, and:
(a) if to the Placement Agent, shall be delivered or sent by mail, telex, facsimile
transmission or email to ▇▇▇▇▇▇▇ & Company, LLC, Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇, Fax: ▇▇▇-▇▇▇-▇▇▇▇
and email ▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇; and
(b) if to the Company, shall be delivered or sent by mail, telex, facsimile
transmission or email to Fuel Systems Solutions, Inc., Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇, Fax:
▇▇▇-▇▇▇-▇▇▇▇, email ▇▇▇▇▇▇@▇▇▇▇▇▇▇.▇▇▇.
Any such statements, requests, notices or agreements shall take effect at the time of receipt
thereof, except that any such statement, request, notice or agreement delivered or sent by email
shall take effect at the time of confirmation of receipt thereof by the recipient thereof.
14. Definition of Certain Terms. For purposes of this Agreement, (a)
“business day” means any day on which the New York Stock Exchange, Inc. is open for
trading and (b) “subsidiary” has the meaning set forth in Rule 405 of the Rules and
Regulations.
15. Governing Law, Agent For Service and Jurisdiction. This Agreement shall
be governed by and construed in accordance with the laws of the State of New York,
including without limitation Section 5-1401 of the New York General Obligations Law.
No legal proceeding may be commenced, prosecuted or continued in any court other
than the courts of the State of New York located in the City and County of New York
or in the United States District
35
Court for the Southern District of New York, which courts shall have
jurisdiction over the adjudication of such matters, and the Company and the
Placement Agent each hereby consent to the jurisdiction of such courts and personal
service with respect thereto. The Company and the Placement Agent each hereby
consent to personal jurisdiction, service and venue in any court in which any legal
proceeding arising out of or in any way relating to this Agreement is brought by any
third party against the Company or the Placement Agent. The Company and the
Placement Agent each hereby waive all right to trial by jury in any legal proceeding
(whether based upon contract, tort or otherwise) in any way arising out of or
relating to this Agreement. The Company agrees that a final judgment in any such
legal proceeding brought in any such court shall be conclusive and binding upon the
Company and the Placement Agent and may be enforced in any other courts in the
jurisdiction of which the Company is or may be subject, by suit upon such judgment.
16. Partial Unenforceability. The invalidity or unenforceability of any
section, paragraph, clause or provision of this Agreement shall not affect the
validity or enforceability of any other section, paragraph, clause or provision
hereof. If any section, paragraph, clause or provision of this Agreement is for any
reason determined to be invalid or unenforceable, there shall be deemed to be made
such minor changes (and only such minor changes) as are necessary to make it valid
and enforceable.
17. General. This Agreement constitutes the entire agreement of the parties
to this Agreement and supersedes all prior written or oral and all contemporaneous
oral agreements, understandings and negotiations with respect to the subject matter
hereof. In connection therewith, the Engagement Letter is hereby terminated and
shall be of no further force and effect. In this Agreement, the masculine, feminine
and neuter genders and the singular and the plural include one another. The section
headings in this Agreement are for the convenience of the parties only and will not
affect the construction or interpretation of this Agreement. This Agreement may be
amended or modified, and the observance of any term of this Agreement may be waived,
only by a writing signed by the Company and the Placement Agent.
18. Counterparts. This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
36
If the foregoing is in accordance with your understanding of the agreement between the Company
and the Placement Agent, kindly indicate your acceptance in the space provided for that purpose
below.
Very truly yours,
| FUEL SYSTEMS SOLUTIONS, INC. |
||||
| By: | /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇ | |||
| Name: | ▇▇▇▇▇▇▇ ▇▇▇▇▇ | |||
| Title: | President | |||
Accepted as of the date
first above written:
first above written:
| ▇▇▇▇▇▇▇ & COMPANY, LLC | ||||
By: |
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |||
| Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | ||||
| Title: Managing Director | ||||
37
SCHEDULE A
General Use Free Writing Prospectuses
None.
SCHEDULE B
List of officers, directors, shareholders, optionholders and warrantholders subject to
Section 4.
▇▇▇▇▇▇▇ Costamanga
Pier Antonio Costamanga
SCHEDULE C
List of Company Subsidiaries
| State or province where | ||||
| Name of subsidiary | Jurisdiction | registered/organized | ||
IMPCO Technologies, Inc.
|
United States | Delaware | ||
Impco Technologies Pty. Ltd.
|
Australia | Victoria | ||
Impco Technologies (SA) Pty. Ltd.
|
Australia | South Australia | ||
Impco Technologies (NSW) Pty. Ltd.
|
Australia | New South Wales | ||
Impco Technologies Fuel Systems Pty, Ltd.
|
Australia | New South Wales | ||
Impco Technologies Japan, KK
|
Japan | Fukuoka | ||
Grupo IMPCO Mexicano
|
Mexico | Estado de México | ||
IMPCO BRC Mexicano
|
Mexico | Estado de México | ||
IMPCO Technologies B.V.
|
Netherlands | Delfgauw, Holland | ||
IMPCO Technologies, GmbH
|
Germany | Grünberg, Germany | ||
IMPCO Technologies, S.a.r.l.
|
France | Genas Cedex, France | ||
IMPCO Technologies, Ltd.
|
United Kingdom | Malvern, U.K | ||
B.R.C. S.r.L
|
Italy | Cherasco (CN) | ||
M.T.M. S.r.L.
|
Italy | Cherasco (CN) | ||
M.T.E. S.r.L.
|
Italy | Cavallermaggiore (CN) | ||
BRC Argentina S.A.
|
Argentina | Buenos Aires | ||
BRC Brasil S.A.
|
Brazil | Rio de Janeiro | ||
NG LOG Armazen Gerais Ltd.
|
Brazil | Sao Paulo | ||
Jehin Engineering Company, Ltd.
|
Korea | Seoul | ||
Zavoli, S.r.L.
|
Italy | Cesena | ||
WMTM Equipamento de Gases Ltda.
|
Brazil | Manaus | ||
BRC Pakistan
|
Pakistan | Karachi |
EXHIBIT A
Form of Subscription Agreement
2
EXHIBIT B
FORM OF LOCK-UP AGREEMENT
▇▇▇▇▇▇▇ & Company, LLC
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: Fuel Systems Solutions, Inc. – Offering of Common Stock
Ladies and Gentlemen:
In order to induce ▇▇▇▇▇▇▇ & Company, LLC (“▇▇▇▇▇▇▇”), to enter in to a certain placement
agent agreement with Fuel Systems Solutions, Inc., a Delaware corporation (the “Company”), with
respect to the public offering of shares of the Company’s Common Stock, par value $0.001 per share
(“Common Stock”), the undersigned hereby agrees that for a period (the “lock-up period”) of ninety
(90) days following the date of the final prospectus filed by the Company with the Securities and
Exchange Commission in connection with such public offering, the undersigned will not, without the
prior written consent of ▇▇▇▇▇▇▇, directly or indirectly, (i) offer, sell, assign, transfer,
pledge, contract to sell, or otherwise dispose of, any shares of Common Stock or securities
convertible into or exercisable or exchangeable for Common Stock (including, without limitation,
shares of Common Stock or any such securities which may be deemed to be beneficially owned by the
undersigned in accordance with the rules and regulations promulgated under the Securities Act of
1933, as the same may be amended or supplemented from time to time (such shares or securities, the
“Beneficially Owned Shares”)), except (x) as a bona fide gift or gifts, provided the donee or
donees thereof agree in writing to be bound by this restriction or (y) in connection with any
issuance of Common Stock pursuant to any employee benefit plan, (ii) enter into any swap, hedge or
other agreement or arrangement that transfers in whole or in part, the economic risk of ownership
of any Beneficially Owned Shares, Common Stock or securities convertible into or exercisable or
exchangeable for Common Stock, or (iii) engage in any short selling of any Beneficially Owned
Shares, Common Stock or securities convertible into or exercisable or exchangeable for Common
Stock.
If (i) the Company issues an earnings release or material news or a material event relating to
the Company occurs during the last seventeen (17) days of the lock-up period, or (ii) prior to the
expiration of the lock-up period, the Company announces that it will release earnings results
during the sixteen (16)-day period beginning on the last day of the lock-up period, the
restrictions imposed by this Agreement shall continue to apply until the expiration of the eighteen
(18)-day period beginning on the issuance of the earnings release or the occurrence of the material
news or material event.
Anything contained herein to the contrary notwithstanding, any person to whom shares of Common
Stock, securities convertible into or exercisable or exchangeable for Common Stock or Beneficially
Owned Shares are transferred from the undersigned shall be bound by the terms of this Agreement.
In addition, the undersigned hereby waives, from the date hereof until the expiration of the
ninety (90) day period following the date of the Company’s final prospectus, any and all rights, if
any, to request or demand registration pursuant to the Securities Act of 1933, as amended, of any
shares of Common Stock or securities convertible into or exercisable or exchangeable for Common
Stock that are registered in the name of the undersigned or that are Beneficially Owned Shares.
| [Signatory] |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
Signature Page to Lock-Up Agreement
2