EXHIBIT 1.1
4,000,000 Shares of Common Stock
LIMCO-PIEDMONT INC.
COMMON STOCK
PAR VALUE $0.01 PER SHARE
UNDERWRITING AGREEMENT
June [__], 2007
▇▇▇▇▇▇▇▇▇▇▇ & Co. Inc.
As representative of the Underwriters
named in Schedule I hereto,
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Limco-Piedmont Inc., a Delaware corporation (the "Company"), proposes,
subject to the terms and conditions stated herein, to issue and sell to the
Underwriters named in Schedule I hereto (together, the "Underwriters"), for whom
▇▇▇▇▇▇▇▇▇▇▇ & Co. Inc. is acting as representative (the "Representative"), an
aggregate of 3,500,000 shares of common stock, par value $0.01 per share
("Common Stock"), of the Company (the "Company Firm Shares"). The Company, at
the election of the Underwriters and subject to the terms and conditions stated
herein, proposes to sell up to 400,000 additional shares of Common Stock (the
"Company Optional Shares"). TAT Technologies Ltd. (the "Selling Shareholder")
proposes, subject to the terms and conditions stated herein, to sell to the
Underwriters an aggregate of 500,000 shares of Common Stock (the "Selling
Shareholder Firm Shares"). In addition, the Selling Shareholder, at the election
of the Underwriters and subject to the terms and conditions stated herein,
proposes to sell up to 200,000 additional shares of Common Stock (the "Selling
Shareholder Optional Shares"). The Company Firm Shares and the Selling
Shareholder Firm Shares are herein referred to collectively as the "Firm Shares"
and the Company Optional Shares and the Selling Shareholder Optional shares are
herein referred to collectively as the "Optional Shares." The
Firm Shares and the Optional Shares that the Underwriters elect to purchase
pursuant to Section 2 hereof are herein collectively called the "Shares."
1. (a) The Company and the Selling Shareholder, jointly and
severally, represent and warrant to, and agree with, each of the Underwriters
that:
(i) A registration statement on Form S-1 (File No.
333-142157) (the "Initial Registration Statement") in respect of the Shares has
been filed with the Securities and Exchange Commission (the "Commission"); the
Initial Registration Statement and any post-effective amendment thereto, each in
the form heretofore delivered to you, and, excluding exhibits thereto, to the
other Underwriters, have been declared effective by the Commission in such form;
other than a registration statement, if any, increasing the size of the offering
(a "Rule 462(b) Registration Statement"), filed pursuant to Rule 462(b) under
the Securities Act of 1933, as amended (the "Act"), which became effective upon
filing, no other document with respect to the Initial Registration Statement has
heretofore been filed with the Commission; the Company has complied to the
Commission's satisfaction with all requests of the Commission for additional or
supplemental information; and no stop order suspending the effectiveness of the
Initial Registration Statement, any post-effective amendment thereto or the Rule
462(b) Registration Statement, if any, has been issued and no proceeding for
that purpose has been initiated or threatened by the Commission (any preliminary
prospectus included in the Initial Registration Statement or filed with the
Commission pursuant to Rule 424(a) of the rules and regulations of the
Commission under the Act, is hereinafter called a "Preliminary Prospectus;" the
various parts of the Initial Registration Statement and the Rule 462(b)
Registration Statement, if any, including all exhibits thereto and including the
information contained in the form of final prospectus filed with the Commission
pursuant to Rule 424(b) under the Act in accordance with Section 5(a) hereof and
deemed by virtue of Rule 430A under the Act to be part of the Initial
Registration Statement at the time it was declared effective, each as amended at
the time such part of the Initial Registration Statement became effective or
such part of the Rule 462(b) Registration Statement, if any, became or hereafter
becomes effective, are hereinafter collectively called the "Registration
Statement"; and such final prospectus, in the form first filed pursuant to Rule
424(b) under the Act, is hereinafter called the "Prospectus"); all references in
this Agreement to the Registration Statement, the Rule 462(b) Registration
Statement, a Preliminary Prospectus, the Prospectus or any amendments or
supplements to any of the foregoing, shall include any copy thereof filed with
the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
System ("▇▇▇▇▇");
(ii) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material respects to
the requirements of the Act and the rules and regulations of the Commission
thereunder, and did not contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; PROVIDED, HOWEVER, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in
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writing to the Company by an Underwriter through the Representative expressly
for use therein; there are no contracts or other documents required to be
described in the Prospectus or to be filed as exhibits to the Registration
Statement which have not been described or filed as required;
(iii) Each Preliminary Prospectus and the Prospectus
when filed, if filed by electronic transmission, pursuant to ▇▇▇▇▇ (except as
may be permitted by Regulation S-T under the Act), was identical to the copy
thereof delivered to the Underwriters for use in connection with the offer and
sale of the Shares; the Registration Statement conforms, and the Prospectus and
any further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of the Act
and the rules and regulations of the Commission thereunder; on the effective
date and at any Time of Delivery (as defined in Section 4 hereof), the
Registration Statement did not or will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein not misleading; and, when
filed and at any Time of Delivery, the Prospectus (together with any supplement
thereto) will not include any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; PROVIDED,
HOWEVER, that this representation and warranty shall not apply to any statements
or omissions made in reliance upon and in conformity with information furnished
in writing to the Company by an Underwriter through the Representative expressly
for use therein;
(iv) As of the Applicable Time, neither (i) any
Issuer-Represented General Use Free Writing Prospectuses issued at or prior to
the Applicable Time and the Statutory Prospectus, all considered together
(collectively, the "General Disclosure Package"), nor (ii) any individual
Issuer-Represented Limited-Use Free Writing Prospectus issued at or prior to the
Applicable Time, 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; PROVIDED, HOWEVER,
that this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information furnished in
writing to the Company by an Underwriter through the Representative expressly
for use therein. As used in this paragraph and elsewhere in this Agreement:
"Applicable Time" means [____] pm (Eastern time) on the date of
this Agreement;
"Statutory Prospectus" as of any time means the most recent
Preliminary Prospectus that is included in the Registration
Statement immediately prior to the Applicable Time;
"Issuer-Represented Free Writing Prospectus" means any "issuer
free writing prospectus," as defined in Rule 433 under the Act,
relating to the Shares in the form filed or required to be filed
with the Commission or, if not required to be
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filed, in the form retained in the Company's records pursuant to
Rule 433(g) under the Act;
"Issuer-Represented General Use Free Writing Prospectus" means
any Issuer-Represented Free Writing Prospectus that is intended
for general distribution to prospective investors, as evidenced
by its being specified in Schedule IV to this Agreement;
"Issuer-Represented Limited-Use Free Writing Prospectus" means
any Issuer-Represented Free Writing Prospectus that is not an
Issuer-Represented General Use Free Writing Prospectus;
(v) Each Issuer-Represented 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 Company
notified or notifies the Representative as described in Section 5(b), did not,
does not and will not include any information that conflicted, conflicts or will
conflict with the information contained in the Registration Statement; PROVIDED,
HOWEVER, that this representation and warranty shall not apply to any statements
or omissions made in reliance upon and in conformity with information furnished
in writing to the Company by an Underwriter through the Representative expressly
for use therein;
(vi) The financial statements, including the related
schedules and notes, filed with the Commission as a part of the Registration
Statement and included in each of the General Disclosure Package and the
Prospectus (the "Financial Statements") present fairly the consolidated
financial position of each of the Company and Piedmont Aviation Component
Services, LLC, a North Carolina Limited Liability Company ("Piedmont," and
together with Limco-Airepair Inc., a Delaware corporation, the "Subsidiaries")
as of and at the dates indicated and the results of their operations and cash
flows for the periods specified; such Financial Statements, have been prepared
in conformity with generally accepted accounting principles as applied in the
United States ("GAAP") applied on a consistent basis throughout the periods
involved; no other financial statements or supporting schedules are required to
be included in the Registration Statement; the consolidated statements of
operations data for the three fiscal years ended December 31, 2006 and the
consolidated balance sheet data as of each of December 31, 2006 and December 31,
2005, as set forth in each of the General Disclosure Package and the Prospectus
under the caption "Selected Consolidated Financial Data" fairly present the
information therein on a basis consistent with that of the audited consolidated
financial statements contained in the Registration Statement; the consolidated
income statement data for the two fiscal years ended December 31, 2003, and the
consolidated balance sheet data as of each of December 31, 2004, December 31,
2003 and December 31, 2002 as set forth in each of the General Disclosure
Package and the Prospectus under the captions "Financial Statements of Piedmont
Aviation Component Services, LLC" fairly present the information therein on a
basis consistent with that of the audited consolidated financial statements of
the Company and the Subsidiaries with respect to those periods;
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(vii) Virchow, ▇▇▇▇▇▇ & Company LLP, who have
certified certain financial statements of the Company and the Subsidiaries, are
independent registered public accountants as required by the Act and the rules
and regulations of the Commission thereunder, and such accountants are not in
violation of the auditor independence requirements of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of
2002 with respect to the Company (the "▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act");
(viii) Tullius ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, who have
certified certain financial statements of the Company and the Subsidiaries, are
independent registered public accountants as required by the Act and the rules
and regulations of the Commission thereunder, and such accountants are not in
violation of the auditor independence requirements of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act
with respect to the Company;
(ix) ▇▇▇▇▇ ▇▇▇▇▇▇ PLLC, who have certified certain
financial statements of Piedmont, are independent registered public accountants
as required by the Act and the rules and regulations of the Commission
thereunder, and such accountants are not in violation of the auditor
independence requirements of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act with respect to the Company;
(x) The statistical and market related data
contained in the General Disclosure Package, the Prospectus or the Registration
Statement are based on or derived from sources which the Company believes are
reliable and accurate;
(xi) This Agreement has been duly authorized,
executed and delivered by the Company;
(xii) Each of the Company and the Subsidiaries has
been duly incorporated or organized and is validly existing as a corporation or
limited liability company in good standing under the laws of the jurisdiction of
its incorporation and has the corporate power and authority to own, lease and
operate its properties and to conduct its business as described in each of the
General Disclosure Package and the Prospectus and, in the case of the Company,
to enter into and perform its obligations under this Agreement; the Company and
each Subsidiary is duly qualified as a foreign corporation or limited liability
company to transact business and is in good standing in each other jurisdiction
in which such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except for such jurisdictions
where the failure to so qualify, or be in good standing, would not, individually
or in the aggregate, have a material adverse effect on the business, properties,
assets, current or future consolidated financial position, business prospects,
shareholders' equity or results of operations of the Company and the
Subsidiaries taken as a whole or on the ability of the Company to consummate the
transactions contemplated herein (a "Material Adverse Effect"); all of the
issued and outstanding share capital or equity interests of each Subsidiary has
been duly authorized and validly issued, is fully paid and nonassessable and is
owned by the Company, directly or through Subsidiaries; the Company owns,
directly or through Subsidiaries, the issued and outstanding share capital or
equity interests of each Subsidiary free and clear of any security Lien; the
Company does not own or control, directly or indirectly, any corporation,
association or other entity other than the Subsidiaries listed in Exhibit 21 to
the Registration Statement;
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(xiii) Neither the Company nor any of the Subsidiaries
has sustained, since the date of the latest audited financial statements
included in the Prospectus, 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 action, order or decree of any
Governmental Entity (as defined below), otherwise than as set forth in each of
the General Disclosure Package and the Prospectus; since the respective dates as
of which information is given in the Registration Statement and the Prospectus,
there has not been any change in the capital stock or material change in the
long-term debt of the Company or any of the Subsidiaries and no event or
development has occurred that has or may reasonably be expected to result in a
Material Adverse Effect; and otherwise than as described in each of the General
Disclosure Package and the Prospectus, there have been no transactions entered
into by the Company or any of the Subsidiaries, other than those in the ordinary
course of business, which are material with respect to the Company and the
Subsidiaries, taken as a whole, and there has been no dividend or distribution
of any kind declared, paid or made by the Company on any class of its capital
stock;
(xiv) The Company and the Subsidiaries have good and
valid title in fee simple to all real property and good and valid title to all
personal property owned by them, in each case free and clear of all any security
interest, mortgage, pledge, lien, encumbrance, restriction, defect or claim
(collectively, "Liens") except such as are described in each of the General
Disclosure Package and the Prospectus or such as do not 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 and the Subsidiaries; and any real property
and buildings held under lease by the Company and the Subsidiaries are held by
them under valid, subsisting and enforceable leases with such exceptions as are
not material and do not interfere with the use made and proposed to be made of
such property and buildings by the Company and the Subsidiaries;
(xv) The Company has an authorized capitalization as
set forth in each of the General Disclosure Package and the Prospectus under the
heading "Capitalization," 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 and have been issued in compliance with federal securities laws;
none of the outstanding shares of Common Stock were issued in violation of any
preemptive rights, rights of first refusal or other similar rights to subscribe
for or purchase securities of the Company; the description of the Company's
share option, share bonus and other share plans or arrangements and the options
or other rights granted thereunder set forth in each of the General Disclosure
Package and the Prospectus accurately and completely presents, in all material
respects, the information required to be shown with respect to such plans,
arrangements, options and rights;
(xvi) The Shares to be issued and sold by the Company
to the Underwriters hereunder have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will be duly
and validly issued and fully paid and non-assessable and will conform to the
description of the Common Stock contained in each of the General Disclosure
Package and the Prospectus;
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(xvii) Except as described in each of the General
Disclosure Package and the Prospectus, (A) there are no outstanding rights
(contractual or otherwise), warrants or options to acquire, or instruments
convertible into or exercisable or exchangeable for, or agreements or
understandings with the Company with respect to the sale or issuance of, any
shares of capital stock of or other equity interest in the Company; and (B)
there are no contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Act or otherwise register any securities the
Company owned or to be owned by such person;
(xviii) The issue and sale of the Shares by the Company
pursuant to this Agreement and the compliance by the Company with all of the
provisions of this Agreement and the consummation by the Company of the
transactions contemplated herein will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of the Subsidiaries is a party or by
which the Company or any of the Subsidiaries is bound or to which any of the
property or assets of the Company or any of the Subsidiaries is subject, nor
will any such action result in any violation of the provisions of the
certificate of incorporation or charter (as applicable) or bylaws of the Company
or any of the Subsidiaries or any law, statute or any order, rule or regulation
of any federal, state, local or foreign court or governmental agency or
regulatory or other body, including self-regulating organizations, having
jurisdiction over the Company or any of the Subsidiaries or any of their
properties or assets (each a "Governmental Entity"); and no consent, approval,
authorization, order, registration or qualification of or with any such
Governmental Entity, is required for the issue and sale of the Shares or the
consummation by the Company of the transactions contemplated by herein, (a)
except the registration under the Act and the Securities Exchange Act of 1934,
as amended (the "1934 Act") of the Shares, (b) except as may be required under
the rules and regulations of the National Association of Securities Dealers,
Inc. ("NASD") and (c) such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Shares by the Underwriters;
(xix) Neither the Company nor any of the Subsidiaries
is (a) in violation of its certificate of incorporation, bylaws, or other
governing document, or (b) in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, note, lease or other agreement or
instrument to which it is a party or by which it or any of its properties may be
bound, except for such default or observance that would not, individually or in
the aggregate, have a Material Adverse Effect;
(xx) The statements set forth in each of the General
Disclosure Package and the Prospectus under the caption "Description of Common
Stock," insofar as they purport to constitute a summary of the terms of the
common stock of the Company, and under the captions "Government Regulations,"
and "Arrangements Between TAT Technologies and Us," insofar as they purport to
describe the provisions of the laws and documents referred to therein, are
accurate and complete in all material respects;
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(xxi) Except as disclosed in each of the General
Disclosure Package and the Prospectus, the Company and the Subsidiaries conduct
their respective businesses in compliance with all federal, state, local and
foreign statutes, laws, rules, regulations, decisions, directives and orders
applicable to them except where the failure to so comply would not, individually
or in the aggregate, have a Material Adverse Effect, and neither the Company nor
any of the Subsidiaries has received any communication from any Governmental
Entity asserting that the Company or any of the Subsidiaries is not in
compliance with any such statute, law, rule, regulation, decision, directive or
order;
(xxii) Except as disclosed in each of the General
Disclosure Package and the Prospectus, there are no actions, suits,
investigations or proceedings before or by any Governmental Entity (a
"Proceeding") now pending or, to the knowledge of the Company, threatened or
contemplated by Governmental Entities or by others, to which the Company or any
of the Subsidiaries is a party or of which any property or asset of the Company
or any of the Subsidiaries is the subject (A) that is required to be disclosed
in the Registration Statement by the Act or by the rules and regulations of the
Commission thereunder and not disclosed therein or (B) which, if determined
adversely to the Company or any of the Subsidiaries, would, individually or in
the aggregate, have a Material Adverse Effect; all pending Proceedings to which
the Company or any of the Subsidiaries is a party or of which any of their
property or assets is the subject, either individually or in the aggregate,
which are not described in the Registration Statement, including ordinary
routine litigation incidental to their respective businesses, would not have a
Material Adverse Effect; and there are no contracts or documents of the Company
or any of the Subsidiaries which would be required to be described in the
Registration Statement or to be filed as exhibits thereto by the Act or by the
rules and regulations of the Commission thereunder which have not been so
described and filed;
(xxiii) Each of the Company and the Subsidiaries possess
all permits, licenses, exemptions, franchises, approvals, consents and other
authorizations of (collectively, "Governmental Licenses"), and has made all
filings, applications and registrations with and given all notices to, all
Governmental Entities to permit the Company or such Subsidiary to conduct the
business now operated by the Company or the Subsidiaries, including any permits
required by the Federal Aviation Administration (the "FAA"), except in each case
where the failure to do so would not, individually or in the aggregate, have a
Material Adverse Effect; the Company and the Subsidiaries are in compliance with
the terms and conditions of all such Governmental Licenses, except where the
failure so to comply would not, individually or in the aggregate, have a
Material Adverse Effect; all of the Governmental Licenses are valid and in full
force and effect, except where the invalidity of such Governmental Licenses or
the failure of such Governmental Licenses to be in full force and effect would
not, individually or in the aggregate, have a Material Adverse Effect; and no
event has occurred (including, without limitation, the receipt of any notice
from any authority or governing body, the execution, delivery and performance of
this Agreement by the Company, the sale and delivery of the Shares and the
compliance by the Company with all of the provisions hereof and the consummation
by the Company and the Subsidiaries of the transactions contemplated in this
Agreement) which
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allows or, after notice or lapse of time or both, would allow, revocation,
suspension or termination of any such Governmental License or results or, after
notice or lapse of time or both, would result in any impairment of the rights of
the holder of any such Governmental License which event, singly or in the
aggregate, would result in a Material Adverse Effect; the Company and the
Subsidiaries are presently conducting their respective businesses in substantial
compliance with the rules and regulations of each applicable Governmental
Agency, including the FAA, and all other material applicable laws;
(xxiv) To the knowledge of the Company and the
Subsidiaries, no change in any law or regulation is pending that would
reasonably be expected to result, individually or in the aggregate, in a
Material Adverse Effect, except as described in each of the General Disclosure
Package and the Prospectus; for the purpose of this paragraph, a law is
considered to be "pending" if has been passed by a legislative committee for
consideration for adoption by the legislature and if it has been published, and
a regulation is considered to be "pending" if has been published for comment by
a Governmental Entity;
(xxv) The Company and its Subsidiaries (i) are in
compliance with any and all applicable foreign, federal, state and local laws
and regulations relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), (ii) have received all permits, licenses or
other approvals required of them under applicable Environmental Laws to conduct
their respective businesses and (iii) are in compliance with all terms and
conditions of any such permit, license or approval, except where such
noncompliance with Environmental Laws, failure to receive required permits,
licenses or other approvals or failure to comply with the terms and conditions
of such permits, licenses or approvals would not, individually or in the
aggregate, result in a Material Adverse Effect;
(xxvi) There are no costs or liabilities associated
with Environmental Laws (including, without limitation, any capital or operating
expenditures required for clean-up, closure of properties or compliance with
Environmental Laws or any permit, license or approval, any related constraints
on operating activities and any potential liabilities to third parties) which
would, individually or in the aggregate, result in a Material Adverse Effect;
(xxvii) The Company and each of the Subsidiaries own
or possess adequate rights to use all patents, patent applications, trademarks,
service marks, trade names, trademark registrations, service ▇▇▇▇ registrations,
copyrights and licenses necessary for the conduct of their respective businesses
except where the failure to so own or possess would not, individually or in the
aggregate, have a Material Adverse Effect; and have no reason to believe that
the conduct of their respective businesses will conflict with, and have not
received any notice of any claim of conflict with, any such rights of others;
(xxviii) No relationship, direct or indirect, exists
between or among the Company on the one hand, and the Selling Shareholder,
directors, officers, customers or suppliers of the Company on the other hand,
which is required to be described in the Registration
9
Statement by the Act or by the rules and regulations of the Commission
thereunder which has not been so described; and all descriptions of such
relationships in each of the General Disclosure Package and the Prospectus are
complete and accurate in all material respects;
(xxix) The Company is not and, after giving effect to
the offering and sale of the Shares and after receipt of payment for the Shares
and the application of such proceeds as described in each of the General
Disclosure Package and the Prospectus, will not be an "investment company" or an
entity "controlled" by an "investment company," as such terms are defined in the
Investment Company Act of 1940, as amended (the "Investment Company Act");
(xxx) The Company is in compliance with the
provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act and the rules and regulations of the
Commission thereunder applicable to it and will comply with those provisions of
the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act that will become effective in the future upon their
effectiveness; and the Company is in compliance with the applicable rules and
regulations of the Nasdaq Global Market except, in either case, where the
failure to so comply would not, individually or in the aggregate, have a
Material Adverse Effect;
(xxxi) The Company has not taken and will not take,
directly or indirectly, any action designed to or that might be reasonably
expected to cause or result in stabilization or manipulation of the price of the
Common Stock to facilitate the sale or resale of the Shares;
(xxxii) Neither the Company nor any of the Subsidiaries
nor, to the Company's knowledge, any employee or agent of the Company or any
Subsidiary in his/her capacity as an 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 or foreign office in violation of any law or
of the character required to be disclosed in the Prospectus;
(xxxiii) The Company maintains a system of accounting
controls sufficient to provide reasonable assurances that (A) transactions are
executed in accordance with management's general or specific authorization; (B)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with GAAP and to maintain accountability for assets;
(C) access to assets is permitted only in accordance with management's general
or specific authorization; and (D) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate action is
taken with respect to any differences;
(xxxiv) The Company has established and maintains
disclosure controls and procedures (as such term is defined in Rule 13a-15(e)
and 15d-15(e) under the 1934 Act). Such disclosure controls and procedures are
designed to ensure that material information relating to the Company, including
its consolidated Subsidiaries, is made known to the Company's Chief Executive
Officer and its Chief Financial Officer by others within those entities to allow
timely decisions regarding disclosures and are effective to perform the
functions for which they were established; the Company's auditors have not
advised the members of the Board of Directors of the Company of (1) any
significant deficiencies or material weaknesses in the design or
10
operation of internal controls over financial reporting which are reasonably
likely to adversely affect the Company's ability to record, process, summarize
and report financial information or (2) any fraud, whether or not material, that
involves management or other employees who have a role in the Company's internal
controls over financial reporting.
(xxxv) Any "employee benefit plan" (as defined under
the Employee Retirement Income Security Act of 1974, as amended, and the
regulations and published interpretations thereunder (collectively, "ERISA"))
established or maintained by the Company, the Subsidiaries or their "ERISA
Affiliates" (as defined below) is in compliance in all material respects with
ERISA; "ERISA Affiliate" means, with respect to the Company or a Subsidiary, any
member of any group of organizations described in Section 414(b), (c), (m) or
(o) of the Internal Revenue Code of 1986, as amended, and the regulations and
published interpretations thereunder (the "Code") of which the Company or such
Subsidiary is a member; no "reportable event" (as defined under ERISA) has
occurred or is reasonably expected to occur with respect to any "employee
benefit plan" established or maintained by the Company, the Subsidiaries or any
of their ERISA Affiliates; no "employee benefit plan" established or maintained
by the Company, the Subsidiaries or any of their ERISA Affiliates, if such
"employee benefit plan" were terminated, would have any "amount of unfunded
benefit liabilities" (as defined under ERISA); none of the Company, the
Subsidiaries nor any of their ERISA Affiliates has incurred or reasonably
expects to incur any liability under (A) Title IV of ERISA with respect to
termination of, or withdrawal from, any "employee benefit plan" or (B) Sections
412, 4971, 4975 or 4980B of the Code; each "employee benefit plan" established
or maintained by the Company, the Subsidiaries or any of their ERISA Affiliates
that is intended to be qualified under Section 401(a) of the Code is so
qualified and nothing has occurred whether by action or failure to act, which
would cause the loss of such qualification;
(xxxvi) The Company and the Subsidiaries, taken as a
whole, are insured by insurers of recognized financial responsibility against
such losses and risks and in such amounts as are prudent and customary in the
business in which they are engaged; and neither the Company nor any of the
Subsidiaries has any reason to believe that it will not be able to renew its
existing insurance coverage from similar insurers as may be necessary to
continue its business at a cost that would not have a Material Adverse Effect;
neither the Company nor any Subsidiary has been denied any insurance coverage
which it has sought or for which it has applied;
(xxxvii) Except as disclosed in each of the General
Disclosure Package and the Prospectus, there are no contracts, agreements or
understandings between the Company and any person that would give rise to a
valid claim against the Company, or any Underwriter, for a brokerage commission,
finder's fee or other like payment;
(xxxviii) No Subsidiary of the Company is currently
prohibited, directly or indirectly, under any agreement or other instrument to
which it is a party or is subject, from paying any dividends to the Company,
from making any other distribution on such Subsidiary's capital stock or from
repaying to the Company any loans or advances to such Subsidiary from
11
the Company, other than as described in each of the General Disclosure Package
and the Prospectus;
(xxxix) The Company and the Subsidiaries have filed all
necessary federal, state and foreign income, franchise and premium tax returns
or have properly requested extensions thereof and have paid all taxes required
to be paid by any of them; the Company and the applicable Subsidiaries have made
adequate charges, accruals and reserves in the applicable financial statements
referred to in Section 1(a)(vi) hereof in respect of all federal, state and
foreign income, franchise and premium taxes for all periods as to which the tax
liability of the Company or any of the Subsidiaries has not been finally
determined;
(xl) No forward-looking statement (within the meaning
of Section 27A of the Act and Section 21E of the Exchange Act) contained in the
Registration Statement, 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;
(xli) At the time of the initial filing of the
Registration Statement and on the date hereof the Company was not and is not an
"ineligible issuer," as defined in Rule 405 under the Act;
(xlii) The Common Stock, including the Shares being
sold hereunder by the Company and the Selling Shareholder, have been approved
for quotation on the Nasdaq Global Market under the symbol "LIMC", subject to
notice of issuance and evidence of satisfactory distribution.
(b) Any certificate signed by an officer of the Company and
delivered to you or to counsel for the Underwriters at any Time of Delivery
shall be deemed to be a representation and warranty by the Company to each
Underwriter as to the matters set forth therein.
(c) The Selling Shareholder represents and warrants to, and
agrees with, each of the Underwriters and the Company that:
(i) All consents, approvals, authorizations and
orders necessary for the execution and delivery by the Selling Shareholder of
this Agreement, and for the sale and delivery of the Shares to be sold by the
Selling Shareholder hereunder, have been obtained; and the Selling Shareholder
has full right, power and authority to enter into this Agreement and to sell,
assign, transfer and deliver the Shares to be sold by the Selling Shareholder
hereunder;
(ii) This Agreement has been duly authorized,
executed and delivered by the Selling Shareholder;
(iii) The sale of the Shares to be sold by the Selling
Shareholder hereunder, the compliance by the Selling Shareholder with all of the
provisions of this Agreement, and the consummation by the Selling Shareholder of
the transactions herein contemplated will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any statute, indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which the Selling Shareholder is a party or
by which the Selling Shareholder is bound or to which any of the property or
assets of the Selling
12
Shareholder is subject, nor will any such action result in any violation of the
provisions of the constituent documents of the Selling Shareholder, or any
statute or any order, rule or regulation of any Governmental Entity having
jurisdiction over the Selling Shareholder or the property or assets of the
Selling Shareholder;
(iv) Immediately prior to each Time of Delivery the
Selling Shareholder will be, except with respect to such Shares at such times as
to which the Share Custodian (as defined below) is the registered owner, the
sole registered and beneficial owner of the Shares to be sold by the Selling
Shareholder hereunder, free and clear of all Liens; and, upon delivery of such
Shares as directed by the Underwriters to a nominee designated by The Depository
Trust Company ("DTC") and payment therefor pursuant hereto, the respective
Underwriters, upon the crediting of such Shares on the records of DTC to
securities accounts of the respective Underwriters, will acquire a security
entitlement in respect of such Shares under Section 8-501 of the New York UCC,
each will be a "protected purchaser" (as defined under the Uniform Commercial
Code of New York (the "New York UCC")) provided that it has no "notice" of an
adverse claim within the meaning of Section 8-105 of the New York UCC, and no
action based on an adverse claim to such security entitlement may be asserted
against the respective Underwriters provided that they have no "notice" of such
adverse claim within the meaning of Section 8-105 of the New York UCC;
(v) The Selling Shareholder has duly authorized,
executed and delivered a copy of the agreement attached hereto as Annex I and
such agreement is in full force and effect and constitutes a valid and binding
obligation of the Selling Shareholder enforceable against the Selling
Shareholder in accordance with its terms;
(vi) The Selling Shareholder has not taken and will
not take, directly or indirectly, any action which is designed to or which has
constituted or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Shares;
(vii) To the extent that any statements or omissions
made in the Registration Statement, any Preliminary Prospectus, the Prospectus,
any Issuer--Represented Free Writing Prospectus or any amendment or supplement
thereto are made in reliance upon and in conformity with written information
furnished to the Company by the Selling Shareholder expressly for use therein,
the Registration Statement, any Preliminary Prospectus and any
Issuer--Represented Free Writing Prospectus conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement, any
Issuer--Represented Free Writing Prospectus or the Prospectus will conform, in
all material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder; on the effective date and at any Time
of Delivery, to the knowledge of the Selling Shareholder, the Registration
Statement did not or will not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary in
order to make the statements therein not misleading; to the knowledge of the
Selling Shareholder, at the Applicable Time, each of the General Disclosure
Package and any individual Issuer--Represented Limited-Use Free Writing
Prospectus, when considered together with the General Disclosure Package, will
not include any
13
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; to the knowledge of the Selling
Shareholder, when filed and at any Time of Delivery, the Prospectus (together
with any supplement thereto) will not include any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;
(viii) In order to document the Underwriters'
compliance with the reporting and withholding provisions of the Tax Equity and
Fiscal Responsibility Act of 1982 with respect to the transactions herein
contemplated, the Selling Shareholder will deliver to you prior to or at the
First Time of Delivery (as hereinafter defined) a properly completed and
executed United States Treasury Department Form W-8BEN (or other applicable form
or statement specified by Treasury Department regulations in lieu thereof);
(ix) Neither the Selling Shareholder nor any of its
affiliates directly, or indirectly through one or more intermediaries, controls,
or is controlled by, or is under common control with, or has any other
association with (within the meaning of Article I, Section (dd) of the By-laws
of the NASD) any member firm of the NASD;
(x) The Selling Shareholder is familiar with the
General Disclosure Package and the Prospectus and has no knowledge of any
material fact, condition or information not disclosed in the General Disclosure
Package and the Prospectus that has had, or may have, a Material Adverse Effect.
The Selling Shareholder is not prompted by any information concerning the
Company or the Subsidiaries which is not set forth in the General Disclosure
Package and the Prospectus to sell its Shares pursuant to this Agreement.
2. Subject to the terms and conditions herein set forth, (a) the
Company and the Selling Shareholder, severally and not jointly, agree to sell to
each of the Underwriters, and each of the Underwriters agree, severally and not
jointly, to purchase from the Company and the Selling Shareholder, at a purchase
price per share of $[______], the number of Firm Shares (to be adjusted by you
so as to eliminate fractional shares) determined by multiplying the aggregate
number of Shares to be sold by each of the Company and the Selling Shareholder
by a fraction, the numerator of which is the aggregate number of Firm Shares to
be purchased by such Underwriter as set forth opposite the name of such
Underwriter in Schedule I hereto and the denominator of which is the aggregate
number of Firm Shares to be purchased by all of the Underwriters from the
Company and all of the Selling Shareholder hereunder and (b) in the event and to
the extent that the Underwriters shall exercise the election to purchase
Optional Shares as provided below, the Company and the Selling Shareholder,
severally and not jointly, agree to sell to each of the Underwriters, and each
of the Underwriters, severally and not jointly, agrees to purchase from the
Company and the Selling Shareholder, at the purchase price per share set forth
in clause (a) of this Section 2, that portion of the number of Optional Shares
as to which such election shall have been exercised (to be adjusted by you so as
to eliminate fractional shares) determined by multiplying such number of
Optional Shares by a fraction the numerator of which is the maximum number of
Optional Shares which such Underwriter is entitled to
14
purchase as set forth opposite the name of such Underwriter in Schedule I hereto
and the denominator of which is the maximum number of Optional Shares that all
of the Underwriters are entitled to purchase hereunder.
The Company and the Selling Shareholder hereby, severally and not
jointly, grant to the Underwriters the right to purchase at their election up to
400,000 additional Company Optional Shares from the Company and up to 200,000
additional Selling Shareholder Optional Shares from the Selling Shareholder, at
the purchase price per share set forth in the paragraph above, for the sole
purpose of covering overallotments in the sale of the Firm Shares. Any such
election to purchase Optional Shares may be exercised only by written notice
from you to the Company and the Selling Shareholder, given within a period of 30
calendar days after the date of this Agreement and setting forth the aggregate
number of Optional Shares to be purchased and the date on which such Optional
Shares are to be delivered, as determined by you but in no event earlier than
the First Time of Delivery or, unless you, the Company and the Selling
Shareholder otherwise agree in writing, no earlier than two or later than ten
business days after the date of such notice.
3. Upon the authorization by you of the release of the Firm Shares,
the Underwriters propose to offer the Firm Shares for sale upon the terms and
conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as the Representative may request upon at least forty-eight hours' prior
notice to the Company, shall be delivered by or on behalf of the Company to the
Representative through the facilities of the DTC, for the account of such
Underwriter, against payment by or on behalf of such Underwriter of the purchase
price therefor by wire transfer of Federal (same day) funds to the respective
accounts specified by the Company to the Representative at least 48 hours in
advance. The time and date of such delivery and payment shall be, with respect
to the Firm Shares, 10 a.m., Eastern time, on [________], 2007 or such other
time and date as the Representative and the Company may agree upon in writing,
and, with respect to the Optional Shares, 10 a.m., New York time, on the date
specified by the Representative in the written notice given by the
Representative of the Underwriters' election to purchase such Optional Shares,
or such other time and date as the Representative and the Company may agree upon
in writing. Such time and date for delivery of the Firm Shares is herein called
the "First Time of Delivery", such time and date for delivery of the Optional
Shares, if not the First Time of Delivery, is herein called the "Second Time of
Delivery", and each such time and date for delivery is herein called a "Time of
Delivery."
(b) The documents to be delivered at each Time of Delivery
by or on behalf of the parties hereto pursuant to Section 7 hereof, including
the cross receipt for the Shares and any additional documents requested by the
Underwriters pursuant to Section 7(k) hereof, will be delivered at the offices
of ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇ ▇▇▇▇▇ (the "Closing Location"), and delivery of the Shares shall be made as
set forth in Section 4(a) hereof, unless the Representative shall otherwise
instruct, all at such Time of Delivery. A meeting will be held at the Closing
Location at 10 a.m., Eastern Time,
15
on the New York Business Day next preceding such Time of Delivery, at which
meeting the final drafts of the documents to be delivered pursuant to the
preceding sentence will be available for review by the parties hereto. For the
purposes of this Section 4, "New York Business Day" shall mean each Monday,
Tuesday, Wednesday, Thursday and Friday which is not a day on which banking
institutions in New York are generally authorized or obligated by law or
executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and
to file such Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement, or, if applicable, such earlier time
as may be required by Rule 430A(a)(3) under the Act; to make no further
amendment or any supplement to the Registration Statement or Prospectus which
shall be disapproved by you promptly after reasonable notice thereof; to advise
you, promptly after it receives notice thereof, of the time when any amendment
to the Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed and to
furnish you with copies thereof; to advise you, 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,
Issuer--Represented Free Writing Prospectus or 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, any Preliminary Prospectus, any Issuer--Represented Free Writing
Prospectus or 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, Issuer--Represented Free Writing Prospectus or
Prospectus or suspending any such qualification, promptly to use its best
efforts to obtain the withdrawal of such order; to advise you, promptly after it
receives notice thereof, of any pending proceeding or examination with respect
to the Registration Statement pursuant to Section 8(d) or 8(e) of the Act;
(b) If at any time following issuance of an
Issuer-Represented Free Writing Prospectus there occurred or occurs an event or
development as a result of which such Issuer-Represented Free Writing Prospectus
conflicted or would conflict with the information contained in the Registration
Statement or included or would include an untrue statement of a material fact or
omitted or would omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances prevailing at that
subsequent time, not misleading, the Company will notify promptly the
Representative so that any use of such Issuer-Represented Free-Writing
Prospectus may cease until it is amended or supplemented and the Company has
promptly amended or will promptly amend or supplement such Issuer-Represented
Free Writing Prospectus to eliminate or correct such conflict, untrue statement
or omission;
(c) The Company represents and agrees that, unless it
obtains the prior written consent of the Representative, it has not made and
will not make any offer relating to the Shares
16
that would constitute an "issuer free writing prospectus," as defined in Rule
433 under the Act, or that would otherwise constitute a "free writing
prospectus," as defined in Rule 405 under the Act, required to be filed with the
Commission. Any such free writing prospectus consented to by the Company and the
Representative is hereinafter referred to as a "Permitted Free Writing
Prospectus." The Company represents that it has treated or agrees that it will
treat each Permitted Free Writing Prospectus as an "issuer free writing
prospectus," as defined in Rule 433, and has complied and will comply with the
requirements of Rule 433 applicable to any Permitted Free Writing Prospectus,
including timely filing with the Commission where required, legending and record
keeping. The Company represents that it has satisfied the conditions in Rule 433
to avoid a requirement to file with the Commission any electronic road show;
(d) Promptly from time to time to take such action as you
may reasonably request to qualify the Shares for offering and sale under the
securities laws of such jurisdictions as you may request and to comply with such
laws so as to permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the distribution of
the Shares, provided that in connection therewith the Company shall not be
required to qualify as a foreign corporation or to file a general consent to
service of process in any jurisdiction;
(e) Prior to 10:00 a.m., Eastern Time, on the New York
Business Day next succeeding the date of this Agreement and from time to time,
to furnish the Underwriters with copies of the Prospectus in New York City in
such quantities as you may from time to time reasonably request, and, if the
delivery of a prospectus is required at any time prior to the expiration of nine
months after the time of issue of the Prospectus in connection with the offering
or sale of the Shares and if at such time any event shall have occurred as a
result of which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not misleading, or, if
for any other reason it shall be necessary during such period to amend or
supplement the Prospectus in order to comply with the Act, to notify you and
upon your request to prepare and file with the Commission (subject to Section
5(a) hereof) and furnish without charge to each Underwriter and to any dealer in
securities as many copies as you may from time to time reasonably request of an
amended Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance, and in case any Underwriter is
required to deliver a prospectus in connection with sales of any of the Shares
at any time nine months or more after the time of issue of the Prospectus, upon
your request but at the expense of such Underwriter, to prepare and deliver to
such Underwriter as many copies as you may request of an amended or supplemented
Prospectus complying with Section 10(a)(3) of the Act;
(f) To make generally available to its securityholders as
soon as practicable an earnings statement of the Company and the Subsidiaries
(which need not be audited) complying with Section 11(a) of the Act and the
rules and regulations thereunder (including, at the option of the Company, Rule
158);
(g) Unless it obtains your prior consent, during the period
beginning from the date hereof and continuing to and including the date 365 days
after the date of the Prospectus,
17
not to directly or indirectly, sell, offer, agree to sell, contract to sell,
hypothecate, pledge, grant any option to purchase, make any short sale,
establish an open "put equivalent position" within the meaning of Rule 16a-l(h)
under the Exchange Act, or otherwise dispose of or transfer, or announce the
offering of, or file a registration statement under the Act in respect of,
except as provided hereunder, any Common Stock or any securities of the Company
that are substantially similar to the Shares, including but not limited to any
securities that are convertible into or exchangeable for, or that represent the
right to receive, Common Stock or any such substantially similar securities
(other than pursuant to employee stock option plans existing on, or upon the
conversion or exchange of convertible or exchangeable securities outstanding as
of, the date of this Agreement), or publicly announce an intention to effect any
such transaction without your prior written consent; provided, however, that if:
(1) during the last 17 days of such 365-day period the Company issues an
earnings release or material news or a material event relating to the Company
occurs; or (2) prior to the expiration of such 365-day period, the Company
announces that it will release earnings results during the 16-day-period
beginning on the last day of such 365-day period, the restrictions imposed by
this Section 5(g) shall continue to apply until the expiration of the 18-day
period beginning on the issuance of the earnings release or the occurrence of
the material news or material event;
(h) During a period of three years from the effective date
of the Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished to shareholders, and to deliver to
you (i) as soon as they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any national securities
exchange on which any class of securities of the Company is listed; and (ii)
such additional information (provided that to the extent such information is not
publicly available, it shall be provided on a confidential basis) concerning the
business and financial condition of the Company as you may from time to time
reasonably request (such financial statements to be on a consolidated basis to
the extent the accounts of the Company and the Subsidiaries are consolidated in
reports furnished to its shareholders generally or to the Commission); provided,
however, that the Company shall not be required to provide you with any such
information, reports or communications that have been filed or furnished with
the Commission by an electronic transmission pursuant to the ▇▇▇▇▇ or an
equivalent electronic database authorized by the Commission and that are
available to the public;
(i) To use the net proceeds received by it from the sale of
the Shares pursuant to this Agreement in the manner specified in the each of the
General Disclosure Package and the Prospectus under the caption "Use of
Proceeds";
(j) To comply with all applicable securities and other
applicable laws, rules and regulations;
(k) If the Company elects to rely on Rule 462(b), the
Company shall file a Rule 462(b) Registration Statement with the Commission in
compliance with Rule 462(b) by 10:00 p.m., Eastern time on the date of this
Agreement, and the Company shall at the time of filing either pay to the
Commission the filing fee for the Rule 462(b) Registration Statement or give
irrevocable instructions for the payment of such fee pursuant to Rule 111(b)
under the Act; and
18
(l) To use its best efforts to list for quotation the Shares
on the Nasdaq Global Market.
6. The Company and the Selling Shareholder covenant and agree with
one another and with the Underwriters that the Company will pay or cause to be
paid the following, whether or not the transactions contemplated herein are
completed: (i) the reasonable out-of-pocket expenses incurred by the
Underwriters in connection with the transactions contemplated hereby, and
marketing, syndication and travel expenses up to $100,000, $50,000 of which has
already been received by the Underwriters; (ii) the fees, disbursements and
expenses of the Company's counsel, counsel for the Selling Shareholder and
accountants in connection with the registration of the Shares under the Act and
all other expenses in connection with the preparation, printing and filing of
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers, including, but not limited to, the
printing and delivery to the Underwriters of copies of each preliminary
prospectus, any Permitted Free Writing Prospectus and the Prospectus and any
amendments or supplements thereto and any costs associated with electronic
delivery of any of the foregoing by the Underwriters to investors; (iii) the
cost of printing or producing any agreement among Underwriters, this Agreement,
the Blue Sky Survey, closing documents (including any compilations thereof) and
any other documents in connection with the offering, purchase, sale and delivery
of the Shares; (iv) all expenses in connection with the qualification of the
Shares for offering and sale under state securities laws as provided in Section
5(d) hereof, including the disbursements of counsel for the Underwriters in
connection with such qualification and in connection with the Blue Sky survey;
(v) all fees and expenses in connection with listing the Shares on the Nasdaq
Global Market; (vi) the filing fees incident to, or in connection with, securing
any required review by the NASD of the terms of the sale of the Shares; (vii)
the cost of preparing share certificates; (viii) the cost and charges of any
transfer agent or registrar; (ix) all expenses of the Company incident to all
road show and informational meeting and any presentation costs; and (ix) all
other costs and expenses incident to the performance of its and the Selling
Shareholder's obligations hereunder which are not otherwise specifically
provided for in this Section.
7. The obligations of the Underwriters hereunder, as to the Shares
to be delivered at each Time of Delivery, shall be subject, in their discretion,
to the condition that all representations and warranties and other statements of
the Company and the Selling Shareholder herein are, at and as of such Time of
Delivery, true and correct, the condition that the Company and the Selling
Shareholder shall have performed all of their respective obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed for such
filing by the rules and regulations under the Act and in accordance with Section
5(a) hereof (or a post-effective amendment shall have been filed and declared
effective in accordance with the requirements of Rule 430A); if the Company has
elected to rely upon Rule 462(b), the Rule 462(b) Registration Statement shall
have become effective by 10:00 P.M., Eastern Time, on the date of this
19
Agreement; no stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceeding for that
purpose shall have been initiated or threatened by the Commission; and all
requests for additional information on the part of the Commission shall have
been complied with to your reasonable satisfaction; and the NASD shall have
raised no objection to the fairness and reasonableness of the underwriting terms
and arrangements;
(b) ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel for the
Underwriters, shall have furnished to you such written opinion or opinions,
dated such Time of Delivery, with respect to such matters as you may reasonably
request, and such counsel shall have received such papers and information as
they may reasonably request to enable them to pass upon such matters;
(c) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel for the Company,
shall have furnished to you their written opinion, dated such Time of Delivery,
in substantially the form set forth in Exhibit A hereto;
(d) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Co., Law Offices, Israeli counsel for
the Selling Shareholder shall have furnished to you their written opinion, dated
such Time of Delivery, in substantially the form set forth in Exhibit C hereto;
(e) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, U.S. counsel for the
Selling Shareholder, shall have furnished to you their written opinion, dated
such Time of Delivery, in substantially the form set forth in Exhibit B hereto;
(f) (i) At the time of the execution of this Agreement, you
shall have received from Virchow, ▇▇▇▇▇▇ & Company LLP, a letter dated such
date, in form and substance satisfactory to you, to the effect that (A) they are
independent registered public accountants with respect to the Company and the
Subsidiaries within the meaning of the Code of Ethics of the American Institute
of Certified Public Accountants, the Act and the rules and regulations of the
Commission thereunder and they are not in violation of the auditor independence
requirements of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act; (B) it is their opinion that the
consolidated financial statements of the Company included in the Registration
Statement, the General Disclosure Package and the Prospectus and covered by
their opinion therein and any supplementary financial information, schedules and
pro forma financial information included in the Registration Statement, the
General Disclosure Package or the Prospectus comply as to form in all material
respects with the applicable accounting requirements of the Act and the rules
and regulations of the Commission thereunder; (C) based upon limited procedures
as agreed upon by you and Virchow, ▇▇▇▇▇▇ & Company LLP set forth in detail in
such letter, including a reading of the latest available interim financial
statements of the Company and the Subsidiaries, a reading of the minute books of
the Company and the Subsidiaries, inquiries of officials of the Company and the
Subsidiaries responsible for financial and accounting matters and such other
inquiries and procedures as may be specified in such letter, nothing has come to
their attention which causes them to believe that (I) (x) the unaudited
consolidated statements of income, consolidated balance sheets and consolidated
statements of cash flows included in each of the General Disclosure Package and
the Prospectus do not comply as to form in all material respects with the
applicable accounting requirements of the Act and the related published rules
and regulations, (y) any material
20
modifications should be made to the unaudited consolidated statements of income,
consolidated balance sheets, consolidated statements of shareholders' equity and
consolidated statements of cash flows included in each of the General Disclosure
Package and the Prospectus, for them to be in conformity with GAAP, or (z) any
unaudited pro forma consolidated financial information included in the General
Disclosure Package or the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the Act and the
published rules and regulations thereunder or the pro forma adjustments have not
been properly applied to the historical amounts in the compilation of those
statements, (II) at a specified date not more than five days prior to the date
of this Agreement, except as disclosed in such letter, there has been any change
in the share capital of the Company or any increase in the consolidated long
term or short term debt of the Subsidiaries or the debt of the Company or any
decrease in consolidated total assets, retained earnings or shareholders' and
members' equity of the Subsidiaries or the total assets or shareholders' equity
of the Company, in each case as compared with the amounts shown in the most
recent consolidated balance sheet of Subsidiaries included in the Registration
Statement or the audited balance sheet of the Company, as the case may be, or
(III) during the period from the date of the most recent consolidated statement
of income included in the Registration Statement to a specified date not more
than five days prior to the date of this Agreement, there were any decreases, as
compared with the corresponding period in the preceding year, in the
consolidated total revenues and net income of the Subsidiaries, except in all
instances for changes, increases or decreases set forth in such letter; (D) in
addition to the audits referred to in their opinions and the limited procedures
referred to in clause (C) above, they have carried out certain specified
procedures, not constituting an audit, with respect to certain amounts,
percentages and financial information which are included in the Registration
Statement and in each of the General Disclosure Package and the Prospectus and
which are specified by you, and have found such amounts, percentages and
financial information to be in agreement with the relevant accounting, financial
and other records of the Company and the Subsidiaries identified in such letter;
and (E) they have compared the information in each of the General Disclosure
Package and the Prospectus under the captions "Selected Consolidated Financial
Data" and "Compensation-Summary Compensation Table" with the respective
disclosure requirements of Regulation S-K and on the basis of limited procedures
specified in such letter nothing came to their attention as a result of the
foregoing procedures that caused them to believe that this information does not
conform in all material respects with the disclosure requirements of Items 301
and 402, respectively, of Regulation S-K;
(ii) At the time of the execution of this Agreement,
you shall have received from Tullius ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, a letter
dated such date, in form and substance satisfactory to you, to the effect that
(A) they are independent registered public accountants with respect to the
Company and the Subsidiaries within the meaning of the Code of Ethics of the
American Institute of Certified Public Accountants, the Act and the rules and
regulations of the Commission thereunder and they are not in violation of the
auditor independence requirements of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act; (B) it is their
opinion that the consolidated financial statements of the Company included in
the Registration Statement, the General Disclosure Package and the Prospectus
and covered by their opinion therein comply as to form in all material respects
with the applicable accounting requirements of the Act and the
21
rules and regulations of the Commission thereunder; and (C) in addition to the
audits referred to in their opinions they have carried out certain specified
procedures, not constituting an audit, with respect to certain amounts,
percentages and financial information which are included in the Registration
Statement and in each of the General Disclosure Package and the Prospectus and
which are specified by you, and have found such amounts, percentages and
financial information to be in agreement with the relevant accounting, financial
and other records of the Company and the Subsidiaries identified in such letter
(iii) At the time of the execution of this Agreement,
you shall have received from ▇▇▇▇▇ ▇▇▇▇▇▇ PLLC, a letter dated such date, in
form and substance satisfactory to you, to the effect that (A) they are
independent registered public accountants with respect to the Piedmont within
the meaning of the Code of Ethics of the American Institute of Certified Public
Accountants, the Act and the rules and regulations of the Commission thereunder
and they are not in violation of the auditor independence requirements of the
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act; (B) it is their opinion that the consolidated financial
statements of Piedmont included in the Registration Statement, the General
Disclosure Package and the Prospectus and covered by their opinion therein
comply as to form in all material respects with the applicable accounting
requirements of the Act and the rules and regulations of the Commission
thereunder;
(iv) At 9:30 a.m., Eastern time, on the effective
date of any post-effective amendment to the Registration Statement filed after
the date of this Agreement and also at each Time of Delivery, you shall have
received from Virchow, ▇▇▇▇▇▇ & Company LLP a letter, dated as of each such
date, to the effect that they reaffirm the statements made in the letter
furnished pursuant to Section 7(f)(i) hereof, except that the specified date
referred to shall be a date not more than five days prior to the date of such
letter;
(g) Neither the Company nor any of the Subsidiaries shall
have sustained since the date of the latest audited financial statements
included in the Prospectus 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 action, order or decree of any Governmental Entity,
otherwise than as described in each of the General Disclosure Package and the
Prospectus, and since the respective dates as of which information is given in
the Prospectus there shall not have been any change in the capital stock or
long-term debt of the Company or any of the Subsidiaries or any change, or any
development involving a prospective change, in or affecting the general affairs,
management, financial position, business prospects, shareholders' and members'
equity or results of operations of the Company and the Subsidiaries taken as a
whole, otherwise than as described in each of the General Disclosure Package and
the Prospectus, the effect of which, in any such case described in this
paragraph, is in the judgment of the Representative so material and adverse as
to make it impracticable or inadvisable to proceed with the public offering or
the delivery of the Shares being delivered at such Time of Delivery on the terms
and in the manner contemplated in the Prospectus;
(h) The Shares to be sold at such Time of Delivery shall
have been duly listed on the Nasdaq Global Market;
(i) The Company has obtained and delivered to the
Underwriters executed
22
copies of an agreement attached hereto as Annex I from each officer and director
of the Company listed on Schedule III hereto and the Selling Shareholder, and
such agreements shall be in full force and effect;
(j) The Company shall have complied with the provisions of
Section 5(e) hereof with respect to the furnishing of prospectuses on the New
York Business Day next succeeding the date of this Agreement;
(k) The Company and Selling Shareholder shall have furnished
or caused to be furnished to you at such Time of Delivery certificates of
officers of the Company or the Selling Shareholder, respectively, satisfactory
to you as to the accuracy of the representations and warranties of the Company
and the Selling Shareholder, respectively, herein at and as of such Time of
Delivery, as to the performance by the Company and the Selling Shareholder of
all of their respective obligations hereunder to be performed at or prior to
such Time of Delivery, as to the matters set forth in subsections (a), (h) and
(i) of this Section 7 and as to such other matters as you may reasonably
request;
If any condition specified in this Section 7 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by you, on behalf of the Underwriters, by notice to the Company at any time on
or prior to the Time of Delivery. If the sale of the Shares provided for herein
is not consummated because any condition set forth in this Section 7 is not
satisfied or because of any refusal, inability or failure on the part of the
Company to perform any agreement herein or comply with any provision hereof, the
Company will reimburse the Underwriters upon demand for all documented
out-of-pocket expenses (including all fees, expenses and disbursements of
counsel) that shall have been incurred by the Underwriters in connection with
the proposed offering of the Shares. In addition, such termination shall be
subject to Section 6 hereof, and Sections 1, 8 and 10 hereof shall survive any
such termination and remain in full force and effect.
8. (a) The Company and the Selling Shareholder agree, jointly and
severally, to indemnify and hold harmless each Underwriter against any losses,
claims, damages or liabilities, joint or several, to which they or any of them
may become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement, the General
Disclosure Package, the Prospectus or any individual Issuer-Represented
Limited-Use Free Writing Prospectus, when considered together with the General
Disclosure Package, or any amendment or supplement thereto, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse each such indemnified party for any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such action or claim as such expenses are incurred; PROVIDED,
HOWEVER, that the Company shall not be liable in any such case to the extent
that any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made in any Preliminary Prospectus, the Registration Statement, the General
Disclosure Package, the
23
Prospectus or any individual Issuer-Represented Limited-Use Free Writing
Prospectus, when considered together with the General Disclosure Package, or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representative expressly for use therein (provided that the Company and the
Underwriters hereby acknowledge and agree that the only information that the
Underwriters have furnished to the Company specifically for inclusion in any
Preliminary Prospectus, the Registration Statement, the General Disclosure
Package, the Prospectus or any individual Issuer-Represented Limited-Use Free
Writing Prospectus (or any amendment or supplement thereto) are (i) the
concession and reallowance figures appearing in the Prospectus and the Statutory
Prospectus in the section entitled "Underwriting," (ii) the thirteenth paragraph
under the section entitled "Underwriting" relating to stabilization
transactions, over-allotment transactions, syndicate covering transactions and
penalty bids in which the Underwriters may engage and (iii) the fifteenth
paragraph under the section entitled "Underwriting" relating to the effecting of
stabilization transactions, syndicate covering transactions and penalty bids
(collectively, the "Underwriters' Information").
(b) Each Underwriter shall indemnify and hold harmless the
Company and the Selling Shareholder against any losses, claims, damages or
liabilities to which they or any of them may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement, the General Disclosure Package, the Prospectus or any
individual Issuer-Represented Limited-Use Free Writing Prospectus, when
considered together with the General Disclosure Package, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in any Preliminary
Prospectus, the Registration Statement, the General Disclosure Package, the
Prospectus or any individual Issuer-Represented Limited-Use Free Writing
Prospectus, when considered together with the General Disclosure Package, or any
such amendment or supplement in reliance upon and in conformity with the
Underwriters' Information; and will reimburse each such indemnified party for
any legal or other expenses reasonably incurred by the them in connection with
investigating or defending any such action or claim as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under
Section 8(a) or (b) hereof of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such Section, notify the indemnifying party in writing
of the commencement thereof; but the omission so to notify the indemnifying
party shall not relieve it from any liability which it may have to any
indemnified party otherwise than under such Section, except to the extent that
such indemnifying party has been materially prejudiced by such omission. In case
any such action shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it shall
wish,
24
jointly with any other indemnifying party similarly notified, to assume the
defense thereof, with a single counsel (in addition to local counsel)
satisfactory to such indemnified party (who shall not, except with the consent
of the indemnified party which consent shall not be unreasonably withheld, be
counsel to the indemnifying party) and, after notice from the indemnifying party
to such indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party for any legal
or other expenses, in each case subsequently incurred by such indemnified party,
in connection with the defense thereof other than reasonable costs of
investigation unless the indemnifying party shall not have employed counsel
satisfactory to the indemnified party within a reasonable time after notice of
commencement of the action, in each of which cases the fees and expenses of
counsel shall be at the expense of the indemnifying party; PROVIDED, HOWEVER, if
the defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that a conflict may arise between the positions of the indemnifying party and
the indemnified party in conducting the defense of any such action or that there
may be legal defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying party, the
indemnified party or parties shall have the right to select separate counsel to
assume such legal defenses and to otherwise participate in the defense of such
action on behalf of such indemnified party or parties, in which case the fees
and expenses of counsel shall be at the expense of the indemnifying party. The
indemnifying party under this Section 8 shall not be liable for any settlement
of any proceedings effected without its written consent, but if settled with
such consent or if there be a final judgment for the plaintiff, the indemnifying
party shall indemnify the indemnified party against any loss, claim, damage,
liability or expense by reason of such settlement or judgment. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses
of counsel as contemplated by this Section 8(c), the indemnifying party agrees
that it shall be liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more than 30 days
after receipt by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request (other than those fees and expenses that are being contested
in good faith) prior to the date of such settlement. No indemnifying party
shall, without the written consent of the indemnified party, effect the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such action
or claim 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 any indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
Section 8(a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in
25
such proportion as is appropriate to reflect the relative benefits received by
the Company and the Selling Shareholder on the one hand and the Underwriters on
the other from the offering of the Shares. If, however, the allocation provided
by the immediately preceding sentence is not permitted by applicable law or if
the indemnified party failed to give the notice required under Section 8(c)
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company and the Selling Shareholder on the one hand and the Underwriters on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof), as well
as any other relevant equitable considerations. The relative benefits received
by the Company and the Selling Shareholder on the one hand and the Underwriters
on the other shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) received by the Company
and the Selling Shareholder bear to the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the table
on the cover page of the Prospectus. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the Selling Shareholder on the
one hand or the Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company, the Selling Shareholder and the Underwriters
agree that it would not be just and equitable if contributions pursuant to this
Section 8(d) were determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to above in this Section 8(d). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to above in this Section 8(d) shall be deemed to
include 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 8(d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this Section 8(d) to
contribute are several in proportion to their respective underwriting
obligations and not joint. The obligations of the Company and the Selling
Shareholder under this Section 8(d) to contribute are joint and several.
(e) The obligations of the Company and the Selling
Shareholder under this Section 8 shall be in addition to any liability which the
Company and the Selling Shareholder may otherwise have and shall extend, upon
the same terms and conditions, to each person, if any, who controls (within the
meaning of Section 15 of the Act) any Underwriter, or any of the respective
partners, directors, officers and employees of any Underwriter or any such
controlling person; and the obligations of the Underwriters under this Section 8
shall be in addition to any
26
liability which the respective Underwriters may otherwise have and shall extend,
upon the same terms and conditions, to each director of the Company (including
any person who, with his or her consent, is named in the Registration Statement
as about to become a director of the Company), each officer of the Company who
signs the Registration Statement and to each person, if any, who controls the
Company or the Selling Shareholder within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to
purchase the Shares which it has agreed to purchase hereunder at a Time of
Delivery, you may in your discretion arrange for you or another party or other
parties to purchase such Shares on the terms contained herein. If within
thirty-six hours after such default by any Underwriter you do not arrange for
the purchase of such Shares, then the Company and the Selling Shareholder shall
be entitled to a further period of thirty-six hours within which to procure
another party or other parties reasonably satisfactory to you to purchase such
Shares on such terms. In the event that, within the respective prescribed
periods, you notify the Company and the Selling Shareholder that you have so
arranged for the purchase of such Shares, or the Company and the Selling
Shareholder notify you that they have so arranged for the purchase of such
Shares, you, the Company and the Selling Shareholder shall have the right to
postpone a Time of Delivery for a period of not more than seven days, in order
to effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus, or in any other documents or arrangements, and the
Company agrees to file promptly any amendments to the Registration Statement or
the Prospectus which in your opinion may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall include any person substituted
under this Section 9 with like effect as if such person had originally been a
party to this Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter or Underwriters by you, the
Company and the Selling Shareholder as provided in Section 9(a) hereof, the
aggregate number of such Shares which remains unpurchased does not exceed
one-tenth of the aggregate number of all the Shares to be purchased at such Time
of Delivery, then the Company and the Selling Shareholder shall have the right
to require each non-defaulting Underwriter to purchase the number of Shares
which such Underwriter agreed to purchase hereunder at such Time of Delivery
and, in addition, to require each non-defaulting Underwriter to purchase its pro
rata share (based on the number of Shares which such Underwriter agreed to
purchase hereunder) of the Shares of such defaulting Underwriter or Underwriters
for which such arrangements have not been made; but nothing herein shall relieve
a defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter or Underwriters by you, the
Company and the Selling Shareholder as provided in Section 9(a) hereof, the
aggregate number of such Shares which remains unpurchased exceeds one-tenth of
the aggregate number of all of the Shares to be purchased at such Time of
Delivery, or if the Company and the Selling Shareholder shall not exercise the
right described in Section 9(b) hereof to require non-defaulting Underwriters to
purchase Shares of a defaulting Underwriter or Underwriters, then this Agreement
(or, with respect to the Second Time of Delivery, the obligations of the
Underwriters to purchase and of the Company and the Selling Shareholder to sell
the Optional Shares) shall thereupon terminate, without liability on
27
the part of any non-defaulting Underwriter or the Selling Shareholder, except
for the expenses to be borne by the Company and the Selling Shareholder and the
Underwriters as provided in Section 6 hereof and the indemnity and contribution
agreements in Section 8 hereof; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company, the Selling Shareholder and the
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Company, or any of the Selling Shareholder, or any officer
or director or controlling person of the Company, or any controlling person of
the Selling Shareholder, and shall survive delivery of and payment for the
Shares.
11. (a) The Representative may terminate this Agreement, by notice
to the Company, at any time on or prior to the Time of Delivery if, since the
time of execution of this Agreement or, in the case of (i) below, since the date
of the most recent balance sheet included in the Financial Statements, there has
occurred, (i) a suspension or material limitation in trading in the Company's
securities on the Nasdaq Global Market or securities generally; (ii) a general
moratorium on commercial banking activities declared by either federal or New
York authorities or a material disruption in commercial banking or securities
settlement or clearance services in the United States; or (iii) the outbreak or
escalation of hostilities involving the United States or the declaration by the
United States of a national emergency or war; or (iv) the occurrence of any
other calamity or crisis or any material change in financial, political or
economic conditions in the United States, including without limitation, as a
result of terrorist activities occurring after the date hereof, if the effect of
any such event specified in clause (ii), (iii) or (iv) above, in the judgment of
the Representative makes it impracticable or inadvisable to proceed with the
public offering or the delivery of the Shares being delivered at such Time of
Delivery on the terms and in the manner contemplated in the Prospectus.
(b) If this Agreement is terminated pursuant to this Section
11, such termination shall be without liability of any party to any other party
except as provided in Section 6 hereof, and provided further that Sections 8 and
10 hereof shall survive such termination and remain in full force and effect.
12. In all dealings hereunder, you shall act on behalf of each of
the Underwriters, and the parties hereto shall be entitled to act and rely upon
any statement, request, notice or agreement on behalf of any Underwriter made or
given by you.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail or
facsimile transmission to you as the Representative at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: [___________], General Counsel, Facsimile Number
(212) [___________]; if to the Selling Shareholder shall be delivered or sent by
mail facsimile transmission to the Selling Shareholder at its address set forth
in Schedule II hereto; and if to the Company shall be delivered or sent by mail
or facsimile to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, ▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇ ▇.
28
Glusband, Facsimile Number (▇▇▇) ▇▇▇-▇▇▇▇; provided, however, that any notice to
an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by
mail or facsimile transmission to such Underwriter. Any such statements,
requests, notices or agreements shall take effect upon receipt thereof.
13. The Company and the Selling Shareholder acknowledge and agree
that, in connection with the purchase and sale of the Shares pursuant to this
Agreement, (i) the purchase and sale of the Shares pursuant to this Agreement,
including the determination of the public offering price of the Shares and any
related discounts and commissions, is an arm's length commercial transaction
between the Company and the Selling Shareholder, on the one hand, and the
Underwriters, on the other hand, (ii) in connection with the process leading to
such transaction, each Underwriter is and has been acting solely as a principal
and is not the agent or fiduciary of the Company, the Selling Shareholder, or
their respective stockholders, creditors, employees or any other party, (iii) no
Underwriter has assumed or will assume an advisory or fiduciary responsibility
in favor of the Company or the Selling Shareholder with respect to the offering
contemplated hereby or the process leading thereto (irrespective of whether such
Underwriter has advised or is currently advising the Company or the Selling
Shareholder on other matters) and no Underwriter has any obligation to the
Company or the Selling Shareholder with respect to the offering contemplated
hereby except the obligations expressly set forth in this Agreement, (iv) the
Underwriters and their respective affiliates may be engaged in a broad range of
transactions that involve interests that differ from those of the Company or the
Selling Shareholder, and (v) the Underwriters have not provided any legal,
accounting, regulatory or tax advice with respect to the offering contemplated
hereby and each of the Company and the Selling Shareholder has consulted its own
legal, accounting, regulatory and tax advisors to the extent it deemed
appropriate.
14. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, the Company, the Selling Shareholder and, to the
extent provided in Sections 8 and 10 hereof, the officers and directors of the
Company, each person who controls the Company, the Selling Shareholder or any
Underwriter and any of the respective partners, directors, officers and
employees of any Underwriter or any such controlling person, and their
respective heirs, executors, administrators, successors and assigns. No other
person shall acquire or have any right under or by virtue of this Agreement. No
purchaser of any of the Shares from any Underwriter shall be deemed a successor
or assign by reason merely of such purchase.
15. Time shall be of the essence of this Agreement. As used herein,
the term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
16. (a) The Selling Shareholder, by the execution and delivery
of this Agreement, designates and appoints ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, as the
authorized agent of the Selling Shareholder for a period of seven years from the
date of this Agreement upon whom process may be served in any suit, proceeding
or other action against the Selling Shareholder instituted by any Underwriter,
the directors, officers, employees and
29
agents of any Underwriter, or by any person controlling an Underwriter as to
which such Underwriter, the directors, officers, employees and agents of any
Underwriter, or any such controlling person is a party and based upon this
Agreement, or in any other action against the Selling Shareholder in any Federal
or state court sitting in the State of New York, arising out of the Registration
Statement, the offering made by the General Disclosure Package or any purchase
or sale of securities in connection therewith, and the Selling Shareholder
expressly accepts jurisdiction of any such court in respect of any such suit,
proceeding or other action and, without limiting other methods of obtaining
jurisdiction, expressly submits to nonexclusive personal jurisdiction of any
such court in respect of any such suit, proceeding or other action. Such
designation and appointment shall be irrevocable, unless and until a successor
authorized agent in the United States reasonably acceptable to the
Representative shall have been appointed by the Selling Shareholder, such
successor shall have accepted such appointment, and written notice thereof shall
have been given to the Representative. The Selling Shareholder further agrees
that service of process upon its authorized agent or successor (and written
notice of said service to the Selling Shareholder, mailed by certified mail or
sent by facsimile or delivered, as provided in Section 12 above) shall be deemed
in every respect personal service of process upon the Selling Shareholder in any
such suit, proceeding or other action. In the event that service of any process
or notice or motion or other application to any such court in connection with
any such action or proceeding cannot be made in the manner described above, such
service may be made in the manner set forth in conformance with the Hague
Convention on the Service Abroad of Judicial and Extrajudicial Documents of
Civil and Commercial Matters or any successor convention or treaty. The Selling
Shareholder hereby irrevocably waives any objection that it may have or
hereafter have to the laying of venue of any such action or proceeding arising
out of or based on the Shares or this Agreement, or otherwise relating to the
offering, issuance and sale of the Shares in any Federal or state court sitting
in the State of New York, and hereby further irrevocably waives any claim that
any such action or proceeding in any such court has been brought in an
inconvenient forum. The Selling Shareholder agrees that any final judgment after
exhaustion of all appeals or the expiration of time to appeal in any appeals or
proceeding arising out of the sale of the Shares or this Agreement rendered by
any such Federal court or state court shall be conclusive and, except as
prohibited by applicable law, may be enforced in any other jurisdiction by suit
on the judgment or in any other manner provided by law. Nothing contained in
this Agreement shall affect or limit the right of the Underwriters to serve any
process or notice of motion or other application in any other manner permitted
by law or limit or affect the right of the Underwriters to bring any action or
proceeding against the Selling Shareholder or any of its property in the courts
of any other jurisdiction. The Selling Shareholder further agrees to take any
and all action, including the execution and filing of all such instruments and
documents, as may be necessary to continue such designation and appointment or
such substitute designation and appointment in full force and effect.
(b) The Selling Shareholder agrees that in any suit (whether
in a court in the United States, Israel or elsewhere) seeking enforcement of
this Agreement or provisions of this Agreement (i) no defense (other than a
procedural defense) given or allowed by the laws of any other state or country
shall be interposed by the Selling Shareholder in any such suit, action or
proceeding unless such defense is also given or allowed by the laws of the State
of New York or of the United States, (ii) if the plaintiffs therein seek a
judgment in either United States dollars or
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Israel currency, subject to Israel foreign currency control regulations, the
Selling Shareholder will not interpose any defense or objection to or otherwise
oppose judgment, if any, being awarded in such currencies except to the extent
that such a judgment would violate the laws of Israel, and (iii) if the
plaintiffs therein seek to have any judgment (or any aspect thereof) awarded in
Israel currency linked, for the period from entry of such judgment until actual
payment thereof in full has been made, to either or both of the consumer price
index of Israel and changes in the Israel currency-United States dollar exchange
rate, the Selling Shareholder will not interpose any defense or objection to or
otherwise oppose inclusion of such linkage in any such judgment except to the
extent that such a judgment would violate the laws of Israel. The Selling
Shareholder agrees that it will not initiate or seek to initiate any action,
suit or proceeding, in Israel or in any other jurisdiction other than in the
United States, seeking damages in respect of or for the purpose of obtaining any
injunction or declaratory judgment against the enforcement of, or a declaratory
judgment concerning any alleged breach by the Selling Shareholder or other claim
by the Underwriters in respect of this Agreement or any of the Underwriters'
rights under this Agreement, including without limitation any action, suit or
proceeding challenging the enforceability of or seeking to invalidate in any
respect the submission by the Selling Shareholder hereunder to the jurisdiction
of the courts or the designation of the laws as the law applicable to this
Agreement, in each case as set forth herein.
(c) The Selling Shareholder agrees that if any payment of
any sum due under this Agreement from the Selling Shareholder is made to or
received by the Underwriters or any controlling person of any Underwriter in a
currency other than freely transferable United States dollars, whether by
judicial judgment or otherwise, the obligations of the Selling Shareholder under
this Agreement shall be discharged only to the extent of the net amount of
freely transferable United States dollars that the Underwriters or such
controlling persons, as the case may be, in accordance with normal bank
procedures, are able to lawfully purchase with such amount of such other
currency. To the extent that the Underwriters or such controlling persons are
not able to purchase sufficient United States dollars with such amount of such
other currency to discharge the obligations of the Selling Shareholder to the
Underwriters or such controlling persons, the obligations of the Selling
Shareholder to the Underwriters or such controlling persons, as the case may be,
shall not be discharged with respect to such difference, and any such
un-discharged amount will be due as a separate obligation and shall not be
affected by payment of or judgment being obtained for any other sums due under
or in respect of this Agreement. To the extent that the Underwriters or such
controlling persons receive any payment with respect to such separate obligation
in freely transferable United States dollars (or currency which can be used to
purchase freely transferable United States dollars in the manner set forth
above), the Underwriters or such controlling persons, as the case may be, will
return to the Selling Shareholder a corresponding amount of the other currency.
17. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES OF SAID STATE OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW. Each of the
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Company and the Selling Shareholder hereby agrees to the exclusive jurisdiction
of the courts of the State of New York, or the Federal courts sitting in New
York County, in connection with any action brought by them relating to or
arising out of this Agreement or the sale of the Shares.
18. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
19. No amendment or waiver of any provision of this Agreement, nor
any consent or approval to any departure therefrom, shall in any event be
effective unless the same shall be in writing and signed by the parties hereto.
[Signatures on Next Page]
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If the foregoing is in accordance with your understanding, please sign
and return to us four counterparts hereof, and upon the acceptance hereof by
you, on behalf of each of the Underwriters, this letter and such acceptance
hereof shall constitute a binding agreement among each of the Underwriters, the
Company and the Selling Shareholder. It is understood that your acceptance of
this letter on behalf of each of the Underwriters is pursuant to the authority
set forth in the Agreement among Underwriters, but without warranty on your part
as to the authority of the signer thereof.
Very truly yours,
LIMCO-PIEDMONT INC.
By: __________________________________
Name:
Title:
TAT TECHNOLOGIES, LTD.
By: __________________________________
Name:
Title:
Accepted as of the date hereof:
▇▇▇▇▇▇▇▇▇▇▇ & CO. INC.
As Representative of the Underwriters
By: __________________________________
Name:
Title:
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