MICROENERGY, INC.
430,000 SHARES OF SERIES A
CUMULATIVE CONVERTIBLE PREFERRED STOCK,
PAR VALUE $.01 PER SHARE
AND
215,000 REDEEMABLE CLASS A WARRANTS
AGREEMENT AMONG UNDERWRITERS
__________, 1996
Dear Sirs:
We wish to confirm our agreement among you the undersigned and
the other underwriters set forth on Schedule A attached hereto
(collectively, the "Underwriters") with respect to the purchase by
the Underwriters severally, on a firm commitment basis, from
MicroEnergy, Inc., a Delaware corporation (the "Company"), of up
to 430,000 shares of Series A Cumulative Convertible Preferred
Stock, par value $.01 per share and 215,000 Redeemable Class A
Warrants (the "Securities").
The Company has filed a registration statement with respect
to the Securities with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the
"Act"), which is more particularly described in the Underwriting
Agreement hereinafter referred to. As used herein, the
"Registration Statement" means such registration statement, as
amended and supplemented from time to time in accordance with the
Act, and the "Prospectus" means the prospectus constituting a part
of the Registration Statement, as amended and supplemented from
time to time in connection with the offering of the Securities.
One or more amendments or supplements to the Registration
Statement or the Prospectus have been or may be filed in which,
with our consent hereby given, we have been or will be named as
one of the underwriters of the Securities, but no such amendment
or supplement shall release us from or otherwise affect our
obligations hereunder or under the Underwriting Agreement.
1. Underwriting Agreement. Annexed hereto is a copy of a
proposed agreement (the "Underwriting Agreement") with the Company
providing for the purchase of the Securities from the Company by
each Underwriter, severally and not jointly, of the respective
amount of the Securities set forth opposite its name in Schedule
A hereto, and providing for the grant by the Company to the
Underwriters, as provided in the Underwriting Agreement, of the
right to purchase Securities pursuant to the Over-Allotment Option
(as defined therein). We authorize you to execute the
Underwriting Agreement on our behalf in substantially the form
annexed hereto. It is understood that the number of Securities to
be purchased by us (hereinafter referred to as "our Securities")
as set forth in the Underwriting Agreement will not be changed
without our consent except as provided herein or in the
Underwriting Agreement. The term "Underwriting Commitment", with
respect to any Underwriter, shall refer to the number of
Securities which such Underwriter is obligated to purchase
pursuant to the provisions of the Underwriting Agreement.
2. Authority of Representative. We authorize you, as
Representative of the several Underwriters, (i) to act as our
representative in all matters concerning the Underwriting
Agreement, this Agreement, and the purchase, carrying, sale and
distribution of the Securities thereunder, (ii) to exercise all
authority vested in the Underwriters or the Representative by the
Underwriting Agreement, including the determination of whether and
to what extent to purchase the Securities pursuant to the Over-Allotment
Option on behalf of the Underwriters, and (iii) to take
such action as you may deem necessary or advisable in respect of
all matters pertaining thereto, including the determination of the
time of the public offering and the furnishing to the Company of
the information to be included in the Prospectus with respect to
the terms of the offering. We understand that you will advise us
when the Securities are released for sale to the public. You will
furnish to us as soon as possible copies of the Prospectus to be
used in connection with the offering of the Securities. We
authorize you on our behalf, in your discretion, to approve or
object to any amendments or supplements to the Registration
Statement or the Prospectus.
We authorize you to reserve for sale and to sell for our
account (a) to institutions and other retail purchasers and (b) to
dealers selected by you ("Selected Dealers"), including
Underwriters, such amounts of our Securities as you determine, and
we authorize you to fix the concessions and reallowances in
connection with any such sales to Selected Dealers. Such
concessions and reallowances may be allowed only as consideration
for services rendered in distribution to Selected Dealers who are
actually engaged in the investment banking or securities business,
and who are either (i) members in good standing of the National
Association of Securities Dealers, Inc., ("NASD") and who agree in
writing to comply with Section 24 of the NASD's Rules of Fair
Practice (the "Rules") or (ii) foreign dealers who are not
eligible for membership in the NASD and (a) who agree that (x) in
making sales of Securities outside the United States they will
comply with the NASD's Interpretation with Respect to Free-Riding
and Withholding and (y) they will not offer or sell any Securities
in the United States and (b) who agree in writing that in making
sales of the Securities outside the United States they will comply
with the provisions of Sections 8, 24 and 36 of Article III of
such Rules and with Section 25 of such Rules as that Section
applies to a non-member broker or dealer in a foreign county.
Except for sales for the accounts of Underwriters designated by a
purchaser, aggregate sales of Securities to institutions and for
the accounts of Underwriters designated by a purchaser, aggregate
sales of Securities to institutions and other retail purchasers
will be made for the accounts of the several Underwriters as
nearly as practicable in proportion to their respective
Underwriting Commitments. Sales of Securities to Selected Dealers
will be made for the accounts of the several Underwriters in such
proportions as you determine.
We authorize you in your discretion, after the Securities are
released for sale to the public, to change the public offering
price of the Securities, the concessions and reallowances in
connection with sales to Selected Dealers and other terms of sale
hereunder and under the agreements with Selected Dealers.
Sales of the Securities between Underwriters may be made with
your prior consent, or as you deem advisable for Blue Sky
purposes.
At or prior to the time when the Securities are released for
sale, you will advise us of the amounts so sold or reserved for
sale for our account. We will retain for direct sale any
Securities purchased by us and not sold or reserved for sale for
our account. With your consent, we may obtain release from you
for direct sale of Securities reserved for sale to Selected
Dealers but not sold and paid for, in which event the amount
reserved for our account for sale to Selected Dealers will be
correspondingly reduced.
After advice from you that the Securities are released for
sale to the public, we will offer for sale to the public in
conformity with the terms of offering set forth in the Prospectus
such of our Securities as you advise us are not sold or reserved
for sale for our account.
We will advise you from time to time, at your request, of the
number of Securities retained by us remaining unsold. You may at
any time (a) reserve any of such Securities for sale by you for
our account or (b) purchase any of such Securities which, in your
opinion, is needed to enable you to make deliveries for the
accounts of the several Underwriters pursuant to this Agreement.
Such purchases will be made at the public offering price or, at
your option, at such price less any part of the Selected Dealers'
concession.
In respect of any Securities sold directly by us and
thereafter purchased by you at or below the public offering price
prior to the termination of this Agreement (or such longer period
as may be necessary to cover any short position with respect to
the offering), you may charge our account with an amount equal to
the Selected Dealers' concession with respect thereto and credit
such amount against the cost thereof, or you may require us to
purchase such Securities at a price equal to the total cost
thereof, including any commissions and transfer taxes on
redelivery.
3. Stabilization and Trading in Securities. We authorize
you, at any time prior to Termination (as defined in Section 5
hereof), in your discretion (a) to make purchase and sales of
Securities in the open market or otherwise, either for long or
short accounts, and on such terms and at such prices as you may
determine and (b) in arranging for sales of Securities pursuant to
Section 2 hereof, to over-allot, and to make purchases for the
purpose of covering any over-allotment so made; provided, however,
that in no time will the aggregate of our net commitments
resulting from such purchases and sales and over-allotments,
whether for long or short account, exceed 15% of our Underwriting
Commitment. All such purchases, sales and over-allotments will be
made for the respective accounts of several Underwriters as nearly
as practicable in proportion to their respective Underwriting
Commitments. We agree to take up at cost on demand any of the
Securities so purchased for our account and to deliver on demand
any of the Securities so sold or over-allotted for our account.
Without limiting the generality of the foregoing, you may buy or
take over for the accounts of the several Underwriters, all in the
proportion and within the limits set forth above, at the price at
which reserved, any Securities of any Underwriter reserved for
sale by you, but not purchased and paid for.
Except as permitted by you, we will not bid for, purchase,
attempt to induce others to purchase, or sell, directly or
indirectly, any Securities otherwise than by (a) the purchase and
sale of Securities as provided in the Underwriting Agreement, this
Agreement or the agreements with Selected Dealers, (b) the
purchase from or sale to other Underwriters or Selected Dealers of
Securities at the public offering price or at such price less any
part of the Selected Dealers' concession and (c) as brokers
pursuant to unsolicited orders. We confirm that we have at all
times complied and agree that we will at all times comply with the
provisions of Rule 10b-6 of the Commission under the Securities
Exchange Act of 1934, as amended (the "1934 Act"), applicable to
this offering.
We understand that, in the event that you effect stabilization
pursuant to this Section, you will notify us promptly of the date
and time at which the first stabilizing purchase is effected and
the date and time when stabilizing is terminated. We agree (and
such agreement will survive Termination) to comply with all
requirements of the 1934 Act and the rules and regulations
thereunder applicable to us with respect to notifications and
keeping of records of stabilizing transactions.
4. Delivery and Payment. At your request, we will furnish
you with funds in an amount equal to the public offering price,
less the Selected Dealers' concession, of either our Securities or
our unreserved Securities, as you may direct, and we authorize you
to make payment therewith pursuant to the provisions of the
Underwriting Agreement. Such payment will be credited to our
account. You may in your discretion make such payment on our
behalf with your own funds, in which event we will reimburse you
on request.
You will promptly deliver to us any Securities purchased by
us and not sold or reserved for sale by you. You may in your
discretion deliver such Securities to us through the facilities of
The Depository Trust Company if transactions in the Securities may
be settled through its facilities and if we are a member or, if we
are not a member, through our ordinary correspondent who is a
member, unless we promptly give you written instructions
otherwise. All other Securities which you then hold for our
account will be delivered to us upon Termination, or prior thereto
in your discretion, and may at any time be delivered to us for
carrying purposes only, subject to redelivery upon demand. If,
upon Termination, the amount of Securities reserved by you which
remains unsold does not exceed ten percent of the aggregate
Underwriting Commitments of all of the Underwriters, you may, in
your discretion, sell such Securities at such prices as you may
determine.
We authorize you, in connection with the purchase,
distribution and resale of the Securities, to advance your own
funds for our account (in which event we will reimburse you on
request), charging current interest rates, or to arrange loans for
our account and execute on our behalf any note in connection
therewith, and to hold or pledge all or any part of our Securities
as security therefor. Any lender is hereby authorized to accept
your instructions with respect thereto.
You will promptly remit to us or credit to our account (a) the
proceeds of any loan made on our behalf and (b) upon payment to
you for any unreserved Securities sold for our account, an amount
equal to the sale price of such Securities received by you, less
transfer taxes, if any, and expenses, and (c) upon payment to you
for any reserved Securities sold for our account, the purchase
price (if any) paid by us for such Securities, and you will debit
or credit, as appropriate, our account with the difference between
the sale price and the purchase price of reserved Securities sold
for our account.
5. Termination and Settlement. Termination of this
Agreement ("Termination") will occur (a) at the close of business
on the forty fifth day after the date of the Underwriting
Agreement, or (b) on such earlier or later date, not more than 30
days after the date specified in (a), as you may determine, or (c)
on the date of termination of the Underwriting Agreement, if the
same shall be terminated as provided by its terms.
Upon Termination, all authorizations, rights and obligations
hereunder will cease, except (a) the mutual obligation to settle
account hereunder, (b) our obligation to pay any claims referred
to in the last paragraph of this Section, (c) our obligation with
respect to purchases which may be made by you from time to time
thereafter to cover any short position with respect to the
offering and (d) the obligations with respect to indemnity and
contribution set forth in Section 7 hereof, all of which will
continue until fully discharged, and except your authority with
respect to matters to be determined by you, or by you and the
Company pursuant to the terms of the Underwriting Agreement, which
will survive Termination.
The accounts arising pursuant to this Agreement will be
settled and paid as soon as practicable after Termination. The
determination by you of the amounts to be paid to or by us will be
final and conclusive.
We authorize you to charge our account with (a) any transfer
taxes on sales made for our account, (b) our proportionate share
(based upon our Underwriting Commitment) of all expenses (other
than transfer taxes) incurred by you, as Representative of the
several Underwriters, in connection with the negotiations for,
purchase of and distribution of the Securities and (c) the
compensation to the Representative referred to in Section 6.
Notwithstanding any settlement upon Termination, we will pay
our proportionate share of an amount asserted against and
discharged by the Underwriters, or any of them, based upon the
claim that the Underwriters constitute an association,
unincorporated business or other separate entity, or based upon or
arising out of a claim that this Agreement or the Underwriting
Agreement is invalid or illegal for any reason, including any
expense incurred in defending against such claim, and will pay any
transfer taxes which may be assessed thereafter on account of any
sale or transfer of Securities for our account.
6. Indemnity and Contribution. Each Underwriter, including
yourselves, agrees to indemnity, hold harmless and reimburse each
other Underwriter, each person who controls any other Underwriter
within the meaning of Section 15 of the Act, and any successor of
any other Underwriter, all if and to the extent that each
Underwriter will be obligated in the Underwriting Agreement to
indemnify, hold harmless and reimburse the Company, each of its
directors, each of its officers who signed the Registration
Statement and each person, if any, who controls the Company within
the meaning of the Act.
Each Underwriter (including yourselves) will pay upon request,
as contribution, its proportionate share, based upon its
Underwriting Commitment, of any losses, claims, damages or
liabilities, joint or several, paid or incurred by any Underwriter
to any person other than an Underwriter arising out of or based
upon any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, the
Prospectus or any related preliminary prospectus or any other
selling or advertising material approved by you for use by the
Underwriters in connection with the sale of the Securities, or the
omission or alleged omission to state therein a material fact
required to be stated therein or necessary in order to make the
statements therein not misleading (other than an untrue statement
or alleged untrue statement or omission or alleged omission made
in reliance upon and in conformity with written information
furnished to the Company by an Underwriter specifically for use
therein); and will pay such proportionate share of any legal or
other expenses reasonably incurred by you or with your consent in
connection with investigating or defending any such loss, claim
damage or liability, or any action in respect thereof. In
determining the amount of any Underwriter's obligation under this
paragraph, appropriate adjustment may be made by you to reflect
any amounts received by any one or more Underwriters in respect of
such claim from the Company, pursuant to the Underwriting
Agreement or otherwise. There will be credited against any amount
paid or payable by us pursuant to this paragraph any loss, damage,
liability or expense which is incurred by us as a result of any
such claim asserted against us, and if such loss, claim, damage,
liability or expense is incurred by us subsequent to any payment
by us pursuant to this paragraph, appropriate provision will be
made to effect such credit, by refund or otherwise. If any such
claim is asserted, you may take such action in connection
therewith as you deem necessary or desirable, including retention
of counsel for the underwriters, and in your discretion separate
counsel for any particular Underwriter or group of Underwriters,
and the fees and disbursements of any counsel so retained by you,
including fees and disbursements for a successful defense, will be
included in the amounts payable pursuant to this paragraph. In
determining amounts payable pursuant to this paragraph, any loss,
claim, damage, liability or expense incurred by any person
controlling any Underwriter within the meaning of Section 15 of
the Act or Section 20 of the 1934 Act which has been incurred by
reason of such control relationship will be deemed to have been
incurred by such Underwriter. Any Underwriter may elect to retain
at its own expense its own counsel. You may settle or consent to
the settlement of any such claim, on advice of counsel retained by
you, with the approval of a majority in interest of the
Underwriters. Whenever you receive notice of the assertion of any
claim to which the provisions of this paragraph would be
applicable, you will give prompt notice thereof to each
Underwriter. You will also furnish each Underwriter with periodic
reports, at such times as you deem appropriate, as to the status
of such claim and the action taken by you in connection therewith.
If any Underwriter or Underwriters default in their obligations to
make any payments under this paragraph, each non-defaulting
Underwriter will be obligated to pay its proportionate share of
all defaulted payments, based upon such Underwriter's Underwriting
Commitment as related to the Underwriting Commitments of all non-defaulting
Underwriters.
7. Position of Representative. In taking any action under
this Agreement, you will act only as agent to the Underwriters and
will be under no liability to us except for lack of good faith,
for obligations expressly assumed by you in this Agreement and for
any liability imposed by the Act.
8. Miscellaneous. If the Underwriting Agreement provides
that the obligations of the Underwriters thereunder are subject to
the condition that the Registration Statement, as defined therein,
shall have become effective not later than a specified time on a
specified date following the date of the of the of Underwriting
Agreement, you are hereby authorized, in your discretion, to
extend such date to not later than the same specified time on the
second full business day following such specified date, and, with
the consent of Underwriters, including yourselves, who have agreed
to purchase in the aggregate at least a majority of the Firm
Securities, to extend such date to any subsequent date and to
execute on our behalf any supplementary agreement that may be
necessary for such purpose.
With respect to the Underwriting Agreement, you are authorized
in your discretion (a) to postpone the Closing Date, or any other
date specified therein and (b) to exercise any right of
cancellation or termination.
Default by any of the other Underwriters with respect to the
Underwriting Agreement will release us from any of our obligations
thereunder and hereunder only if the Underwriting Agreement is
thereupon terminated in accordance with its terms. If one or more
Underwriters default under the Underwriting Agreement, you may
arrange for the purchase by others, including non-defaulting
Underwriters, of Securities not taken up by the defaulting
Underwriter or Underwriters.
Nothing herein contained will constitute the Underwriters a
partnership, association or separate entity, and the obligations
of ourselves and of each of the other Underwriters are several and
not joint. If for Federal income tax purposes the several
Underwriters should be deemed to constitute a partnership, then
each Underwriter elects to be excluded from the application of
Subchapter K, Chapter 1, Subtitle A, of the Internal Revenue Code
of 1986, as amended. You, as Representative of the several
Underwriters, are authorized, in your discretion, to execute on
behalf of the Underwriters such evidence of such election as may
be required by the Internal Revenue Service.
We authorize you to file with any governmental agency any
reports required to be field by you in connection with the
transactions contemplated by this Agreement or the Underwriting
Agreement, and we will furnish any information in our possession
needed for such reports. You do not assume any responsibility or
obligation as to our right to sell the Stock in any jurisdiction,
notwithstanding any information you may furnish in that
connection.
We will not advertise over our name until after the first
public advertisement made by you and then only at our own expense
and risk. We authorize you to exercise complete discretion with
regard to the first public advertisement.
You will not be under any duty to account for any interest on
our funds at any time in your hands.
We hereby confirm that we are willing to accept the
responsibilities under the Act of an Underwriter named in the
Registration Statement. We agree that we will deliver all
preliminary and final prospectuses required for compliance with
the provisions of Rule 15c2-8 under the 1934 Act. We agree to
purchase our Securities, set forth on Schedule A, on a "firm
committment basis" and that we will meet all net capital
requirements to do so.
Any notice from you to us will be deemed to have been duly
given if mailed, telexed or sent by facsimile or other written
communication to us at the address set forth on the signature page
hereof. Any notice to you will be deemed to have been duly given
if mailed, telexed or sent by facsimile or other written
communication to you at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, President, with a copy to
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, LLP ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, or at such other address
as you shall specify.
You represent that you are a member in good standing of the
NASD and we represent that we are actually engaged in the
investment banking or securities business and are a member in good
standing of the NASD or a foreign dealer not eligible for
membership in the NASD and we agree that, if the former, we will
comply with the provisions of Section 24 of the Rules, and, if the
latter, that (i) in making sales of the Securities outside the
United States, we will comply with the provisions of Sections 8,
24 and 36 of such rules, with Section 25 of such Rules as that
Section applies to a non-member broker or dealer in a foreign
country and with the requirements of the NASD's Interpretation
with Respect to Free-Riding and Withholding, and (ii) we will not
offer or sell any of the Securities in the United States except
through you.
The Agreement will be governed by and construed in accordance
with the laws of the State of New York, without regard to the
principles of conflict of law.
The Agreement is being executed by us and delivered to you in
duplicate. Please indicate your receipt of identical agreements
from each of the other Underwriters by signing and returning to us
one counterpart of this Agreement whereupon it will constitute a
binding contract between us.
Very truly yours,
[Name of Underwriter]
By
Name:
Title:
Address:
Confirmed as of the day and year first above written
I.A. ▇▇▇▇▇▇▇▇▇▇ & CO.
As Representative of the Underwriters
By:
Name:
Title:
Schedule A
Name Preferred Stock Warrants
I.A. ▇▇▇▇▇▇▇▇▇▇ & Co.
___________________
_______________ __________
Total 430,000 215,000