SHARPSPRING, INC. (a Delaware corporation) 2,054,948 Shares of Common Stock UNDERWRITING AGREEMENT
2,054,948
Shares of Common Stock
June
13, 2019
Canaccord
Genuity LLC
▇▇▇▇
Capital Partners, LLC
as
Representatives of the several Underwriters
c/o
Canaccord Genuity LLCa
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▇▇▇▇▇▇,
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c/o
Roth Capital Partners, LLC
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▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies
and Gentlemen:
SharpSpring, Inc.,
a Delaware corporation (the “Company”) and
the selling stockholders named in Schedule B hereto (the
“Selling
Stockholders”), confirm their agreement with Canaccord
Genuity LLC (“Canaccord”),
▇▇▇▇ Capital Partners, LLC (“▇▇▇▇”) and
each of the other underwriters named in Schedule A hereto
(collectively, the “Underwriters,”
which term shall also include any underwriter substituted as
provided in Section 12 hereof), for
whom Canaccord and ▇▇▇▇ are acting as representatives (in such
capacity, the “Representatives”)
with respect to the sale by the Selling Stockholders, acting
severally and not jointly, and the purchase by the Underwriters,
acting severally and not jointly, of the respective numbers of
shares of common stock, par value $0.001 per share, of the Company
(the “Common Stock”)
set forth in Schedule A hereto,
pursuant to this Underwriting Agreement (this “Agreement”).
The aforesaid 2,054,948 shares of Common Stock are herein called
the “Securities.”
The
Company and the Selling Stockholders understand that the
Underwriters propose to make a public offering of the Securities as
soon as the Representatives deem advisable after this Agreement has
been executed and delivered.
The
Company has filed with the Securities and Exchange Commission (the
“Commission”) a
registration statement on Form S-3 (No. 333-231758) covering
the public offering and sale of certain securities, including the
Securities, under the Securities Act of 1933, as amended (the
“1933
Act”) and the rules and regulations promulgated
thereunder (the “1933 Act
Regulations”). As used herein, “Registration
Statement” means such registration statement as
amended by any post-effective amendments thereto, including the
exhibits and any schedules thereto, the documents incorporated or
deemed to be incorporated by reference therein pursuant to Item 12
of Form S-3 under the 1933 Act and the documents otherwise deemed
to be a part thereof pursuant to Rule 430B under the 1933 Act
Regulations (the “Rule 430B
Information”). Each preliminary prospectus used in
connection with the offering of the Securities, including the
documents incorporated or deemed to be incorporated by reference
therein pursuant to Item 12 of Form S-3 under the 1933 Act, are
collectively referred to herein as a “preliminary
prospectus.” Promptly after execution and delivery of this
Agreement, the Company will prepare and file a final prospectus
relating to the Securities in accordance with the provisions of
Rule 424(b) (“Rule 424(b)”)
of the 1933 Act Regulations. Any registration statement filed
pursuant to Rule 462(b) of the 1933 Act Regulations is herein
called the “Rule 462(b) Registration
Statement” and, after such filing, the term
“Registration Statement” shall include the Rule 462(b)
Registration Statement. The final prospectus, in the form first
furnished or made available to the Underwriters for use in
connection with the offering of the Securities, including the
documents incorporated or deemed to be incorporated by reference
therein pursuant to Item 12 of Form S-3 under the 1933 Act, are
collectively referred to herein as the “Prospectus.”
For purposes of this Agreement, all references to the Registration
Statement, any preliminary prospectus, the Prospectus or any
amendment or supplement to any of the foregoing shall be deemed to
include the copy filed with the Commission pursuant to its
Electronic Data Gathering, Analysis and Retrieval system or any
successor system (“▇▇▇▇▇”).
As used
in this Agreement:
“Applicable
Time” means 7:30 A.M. New York City time, on June
13, 2019 or such other time as agreed by the Company and the
Representatives.
“General Disclosure
Package” means any Issuer General Use Free Writing
Prospectuses issued at or prior to the Applicable Time, the most
recent preliminary prospectus that is distributed to investors
prior to the Applicable Time and the information included on
Schedule C-1
hereto, all considered together.
“Issuer Free Writing
Prospectus” means any “issuer free writing
prospectus,” as defined in Rule 433 of the 1933 Act
Regulations (“Rule 433”),
including without limitation any “free writing
prospectus” (as defined in Rule 405 of the 1933 Act
Regulations (“Rule 405”))
relating to the Securities that is (i) required to be filed
with the Commission by the Company, (ii) a “road show
that is a written communication” within the meaning of Rule
433(d)(8)(i), whether or not required to be filed with the
Commission, or (iii) exempt from filing with the Commission
pursuant to Rule 433(d)(5)(i) because it contains a description of
the Securities or of the offering that does not reflect the final
terms, in each case in the form filed or required to be filed with
the Commission or, if not required to be filed, in the form
retained in the Company’s records pursuant to Rule
433(g).
“Issuer General Use Free
Writing Prospectus” means any Issuer Free Writing
Prospectus that is intended for general distribution to prospective
investors (other than a “bona fide electronic road show,”
as defined in Rule 433 (the “Bona Fide Electronic Road
Show”)), as evidenced by its being specified in
Schedule C-2
hereto.
“Issuer Limited Use Free
Writing Prospectus” means any Issuer Free Writing
Prospectus that is not an Issuer General Use Free Writing
Prospectus.
All
references in this Agreement to financial statements and schedules
and other information which is “contained,”
“included” or “stated” (or other references
of like import) in the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to include all such
financial statements and schedules and other information
incorporated or deemed incorporated by reference in the
Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be, prior to the execution and delivery
of this Agreement; and all references in this Agreement to
amendments or supplements to the Registration Statement, any
preliminary prospectus or the Prospectus shall be deemed to include
the filing of any document under the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated
thereunder (collectively, the “1934 Act”),
incorporated or deemed to be incorporated by reference in the
Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be, at or after the execution and
delivery of this Agreement.
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SECTION 1. Representations and
Warranties.
(a) Representations and Warranties
by the Company. The Company
meets the requirements for use of Form S-3 under the 1933 Act
including the requirements under General Instruction I.B.1 of such
Form S-3. The Company represents and warrants to each Underwriter
as of the date hereof, the Applicable Time, and the Closing Time
(as defined below), and agrees with each Underwriter, as
follows:
(i) Registration Statement
and Prospectuses. Each of the
Registration Statement and any amendment thereto has been declared
effective under the 1933 Act. No stop order suspending the
effectiveness of the Registration Statement or any post-effective
amendment thereto has been issued under the 1933 Act, no order
preventing or suspending the use of any preliminary prospectus or
the Prospectus has been issued and no proceedings for any of those
purposes have been instituted or are pending or, to the
Company’s knowledge, contemplated. The Company has complied
with each request (if any) from the Commission for additional
information.
Each of
the Registration Statement and any post-effective amendment
thereto, at the time it became effective, complied in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations. Each preliminary prospectus, the Prospectus and any
amendment or supplement thereto, at the time each was filed with
the Commission, complied in all material respects with the
requirements of the 1933 Act and the 1933 Act Regulations. Each
preliminary prospectus delivered by the Company to the Underwriters
for use in connection with this offering and the Prospectus was or
will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to ▇▇▇▇▇, except to the extent
permitted by Regulation S-T.
The
documents incorporated or deemed to be incorporated by reference in
the Registration Statement, any preliminary prospectus and the
Prospectus, when they became effective or at the time they were or
hereafter are filed with the Commission, complied and will comply
in all material respects with the requirements of the 1934 Act and
the rules and regulations of the Commission under the 1934 Act (the
“1934 Act
Regulations”).
(ii) Accurate
Disclosure. Neither the
Registration Statement nor any amendment thereto, at its effective
time, at the Closing Time, contained, contains or will contain an
untrue statement of a material fact or omitted, omits or will omit
to state a material fact required to be stated therein or necessary
to make the statements therein not misleading. As of the Applicable
Time, neither (A) the General Disclosure Package nor
(B) any individual Issuer Limited Use Free Writing Prospectus,
when considered together with the General Disclosure Package,
included an untrue statement of a material fact or omitted 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. Neither the Prospectus nor any amendment or supplement
thereto (including any prospectus wrapper), as of its issue date,
at the time of any filing with the Commission pursuant to Rule
424(b), at the Closing Time, included, includes or will include an
untrue statement of a material fact or omitted, omits or will omit
to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading. The documents incorporated or deemed to be
incorporated by reference in the Registration Statement, the
General Disclosure Package and the Prospectus, at the time the
Registration Statement became effective or when such documents
incorporated by reference were filed with the Commission, as the
case may be, when read together with the other information in the
Registration Statement, the General Disclosure Package or the
Prospectus, as the case may be, did not and will not include an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading.
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The
representations and warranties in this Section 1(a)(ii) shall
not apply to statements in or omissions from the Registration
Statement (or any amendment thereto), the General Disclosure
Package, the Prospectus (or any amendment or supplement thereto) or
any Issuer Free Writing Prospectus made in reliance upon and in
conformity with written information furnished to the Company by any
Underwriter through the Representatives expressly for use therein.
For purposes of this Agreement, the only information so furnished
shall be the fourth paragraph under the heading
“Underwriting” in each case contained in the Prospectus
(collectively, the “Underwriter
Information”).
(iii) Issuer Free Writing
Prospectuses. No Issuer Free
Writing Prospectus conflicts or will conflict with the information
contained in the Registration Statement or the Prospectus,
including any document incorporated by reference therein, and any
preliminary or other prospectus deemed to be a part thereof that
has not been superseded or modified.
(iv) Company Not Ineligible
Issuer. At the time of filing
the Registration Statement and any post-effective amendment
thereto, at the earliest time thereafter that the Company or
another offering participant made a bona fide offer (within the meaning of Rule 164(h)(2) of the
1933 Act Regulations) of the Securities and at the date hereof, the
Company was not and is not an “ineligible issuer,” as
defined in Rule 405, without taking account of any determination by
the Commission pursuant to Rule 405 that it is not necessary that
the Company be considered an ineligible issuer.
(v) [Reserved.]
(vi) FINRA
Exemption. The Company
satisfies the pre-1992 eligibility requirements for the use of a
registration statement on Form S-3 in connection with the offering
contemplated thereby (the pre-1992 eligibility requirements for the
use of the registration statement on Form S-3 include (i) having a
non-affiliate, public common equity float of at least $150 million
or a non-affiliate, public common equity float of at least $100
million and annual trading volume of at least three million shares
and (ii) having been subject to the 1934 Act reporting requirements
for a period of 36 months).
(vii) Independent
Accountants. Cherry Bekaert
LLP, who certified the financial statements and supporting
schedules incorporated by reference in the Registration Statement,
the General Disclosure Package and the Prospectus are independent
public accountants as required by the 1933 Act, the 1933 Act
Regulations and the Public Company Accounting Oversight
Board.
(viii) Financial Statements;
Non-GAAP Financial Measures.
The financial statements included in the Registration Statement,
the General Disclosure Package and the Prospectus, together with
the related schedules and notes, present fairly, in all material
respects, the financial position of the Company and its
subsidiaries at the dates indicated and its results of operations,
stockholders’ equity and cash flows for the periods
specified; said financial statements have been prepared in
conformity with U.S. generally accepted accounting principles
(“GAAP”)
applied on a consistent basis throughout the periods involved
(except for any preparation of non-GAAP measures). The supporting
schedules, if any, present fairly in all material respects in
accordance with GAAP the information required to be stated therein.
The selected financial data and the summary financial information
included or incorporated by reference in the Registration
Statement, the General Disclosure Package and the Prospectus
present fairly the information shown therein and have been compiled
on a basis consistent with that of the audited financial statements
included or incorporated by reference therein. Except as included
therein, no historical or pro forma financial statements or supporting schedules are
required to be included in the Registration Statement, the General
Disclosure Package or the Prospectus under the 1933 Act or the 1933
Act Regulations. All disclosures contained in the Registration
Statement, the General Disclosure Package or the Prospectus
regarding “non-GAAP financial measures” (as such term
is defined by the rules and regulations of the Commission) comply
in all material respects with Regulation G of the 1934 Act, and
Item 10 of Regulation S-K of the 1933 Act, to the extent
applicable.
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(ix) No Material Adverse
Change in Business. Except as
otherwise stated therein, since the respective dates as of which
information is given in the Registration Statement, the General
Disclosure Package or the Prospectus, (A) there has been no
material adverse change in the condition, financial or otherwise,
or in the earnings, business affairs or business prospects of the
Company or any of its subsidiaries, whether or not arising in the
ordinary course of business (a “Material
Adverse Effect”),
(B) there have been no transactions entered into by the
Company or any of its subsidiaries, other than those in the
ordinary course of business, which are material to the Company, and
(C) there has been no dividend or distribution of any kind
declared, paid or made by the Company or any of its subsidiaries on
any class of its capital stock.
(x) Good Standing of the
Company. The Company is a
corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware. The Company has requisite
corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the
Registration Statement, the General Disclosure Package and the
Prospectus and to enter into and perform its obligations under this
Agreement; and the Company is duly qualified as a foreign
corporation 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 where the failure so to qualify or to be in good
standing would not result in a Material Adverse
Effect.
(xi) Subsidiaries.
Each of the Company’s subsidiaries has been duly organized
and is validly existing as a corporation or other entity in good
standing (or the foreign equivalent thereof) under the laws of its
jurisdiction of organization, with requisite power and authority to
own or lease its properties and conduct its business as described
in the Registration Statement, the General Disclosure Package and
the Prospectus. Each of the Company’s subsidiaries is duly
qualified to transact business in all jurisdictions in which the
conduct of its business requires such qualification, except where
the failure to be so qualified would not have a Material Adverse
Effect. All of the issued shares of capital stock or other
ownership interest of each of the subsidiaries have been duly
authorized and validly issued, are fully paid and non-assessable
and are owned directly or indirectly by the Company, free and clear
of all liens, encumbrances, equities or claims, except for such
liens, encumbrances, equities or claims as would not, individually
or in the aggregate, reasonably be expected to have a Material
Adverse Effect. The Company does not own or control, directly or
indirectly, any corporation, association or other entity other than
the subsidiaries listed in Schedule E
hereto (each, a
“subsidiary,”
and collectively, the “subsidiaries”).
(xii) Capitalization.
The Company has an authorized capitalization as set forth in the
Registration Statement, the General Disclosure Package and the
Prospectus as of the date or dates set forth therein. The
outstanding shares of capital stock of the Company have been duly
authorized and validly issued and are fully paid and
non-assessable. None of the outstanding shares of capital stock of
the Company were issued in violation of the preemptive or other
similar rights of any securityholder of the Company. Except as
described in or expressly contemplated by the Registration
Statement, the General Disclosure Package and the Prospectus, there
are no outstanding rights (including, without limitation,
pre-emptive rights), warrants or options to acquire, or instruments
convertible into or exchangeable for, any shares of capital stock
or other equity interest in the Company, or any contract,
commitment, agreement, understanding or arrangement of any kind
relating to the issuance of any capital stock of the Company, any
such convertible or exchangeable securities or any such rights,
warrants or options.
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(xiii) Stock
Options.
With respect to the outstanding stock
options (the “Stock
Options”) granted
pursuant to the stock-based compensation plan of the Company (the
“Company
Stock Plan”), (i) each
Stock Option intended to qualify as an “incentive stock
option” under Section 422 of the Internal Revenue Code of
1986 , as amended (the “Code”),
so qualified, (ii) each grant of a Stock Option was duly authorized
no later than the date on which the grant of such Stock Option was
by its terms to be effective (the “Grant
Date”) by all necessary
corporate action, including, as applicable, approval by the board
of directors of the Company (or a duly constituted and authorized
committee thereof) and any required stockholder approval by the
necessary number of votes or written consents, and the award
agreement governing such grant (if any) was duly executed and
delivered by each party thereto, (iii) each such grant was made in
accordance with the terms of the Company Stock Plan and all other
applicable laws and regulatory rules or requirements, except where
the failure to comply with such laws, regulatory rules or
requirements would not result in a Material Adverse Effect, and
(iv) each such grant was properly accounted for in accordance with
GAAP in the financial statements (including the related notes) of
the Company included in the Registration Statement, the General
Disclosure Package and the Prospectus, to the extent required under
GAAP to be accounted for in such financial
statements.
(xiv) Authorization of
Agreement. This Agreement has
been duly authorized, executed and delivered by the
Company.
(xv) Authorization and
Description of Securities. The
Securities to be purchased by the Underwriters from the Selling
Stockholders have been duly authorized and validly issued, fully
paid and nonassessable, and have been issued in compliance in all
material respects with all applicable securities laws, and conform
in all material respects to the description thereof in the
Registration Statement, the General Disclosure Package and the
Prospectus. The sale of the Securities to the Underwriters by the
Selling Stockholders is not subject to the preemptive or other
similar rights of any securityholder of the Company. The capital
stock of the Company conforms in all material respects to all
statements relating thereto contained in the Registration
Statement, the General Disclosure Package and the Prospectus. No
holder of Securities will be subject to personal liability solely
by reason of being such a holder.
(xvi) Registration
Rights. There are no persons
with registration rights or other similar rights to have any
securities registered for sale pursuant to the Registration
Statement or otherwise registered for sale or sold by the Company
under the 1933 Act pursuant to this Agreement, other than those
rights that have been disclosed in the Registration Statement, the
General Disclosure Package and the Prospectus and have been waived
or satisfied.
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(xvii) Absence of Violations,
Defaults and Conflicts. The
Company and each of its subsidiaries is not (A) in violation
of its charter or by-laws (or analogous governing instruments, if
applicable), (B) in default in the performance or observance
of any obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or other agreement or instrument to which
the Company or any of its subsidiaries is a party or by which it
may be bound or to which any of the properties or assets of the
Company or any of its subsidiaries is subject (collectively,
“Agreements
and Instruments”), except
for such defaults that would not reasonably be expected to, singly
or in the aggregate, result in a Material Adverse Effect, or
(C) in violation of any law, statute, rule, regulation,
judgment, order, writ or decree of any arbitrator, court,
governmental body, regulatory body, administrative agency or other
authority, body or agency having jurisdiction over the Company, any
of its subsidiaries or any of its properties, assets or operations
(each, a “Governmental
Entity”), except for such
violations that would not reasonably be expected to, singly or in
the aggregate, result in a Material Adverse Effect. The execution,
delivery and performance of this Agreement and the consummation of
the transactions contemplated herein and in the Registration
Statement, the General Disclosure Package and the Prospectus and
compliance by the Company with its obligations hereunder have been
duly authorized by all necessary corporate action and do not and
will not, whether with or without the giving of notice or passage
of time or both, conflict with or constitute a breach of, or
default or Repayment Event (as defined below) under, or result in
the creation or imposition of any lien, charge or encumbrance upon
any properties or assets of the Company or any of its subsidiaries
pursuant to, the Agreements and Instruments (except for such
conflicts, breaches, defaults or Repayment Events or liens, charges
or encumbrances that would not reasonably be expected to, singly or
in the aggregate, result in a Material Adverse Effect), nor will
such action result in any violation of (i) the provisions of
the charter or by-laws of the Company or any of its subsidiaries or
(ii) any law, statute, rule, regulation, judgment, order, writ
or decree of any Governmental Entity, except with respect to clause
(ii), such violations as would not reasonably be expected to,
singly or in the aggregate, result in a Material Adverse Effect. As
used herein, a “Repayment
Event” means any event or
condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such
holder’s behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such indebtedness by
the Company or any of its subsidiaries.
(xviii) Absence of Labor
Dispute. No labor dispute with
the employees of the Company or any of its subsidiaries exists or,
to the knowledge of the Company, is imminent, and the Company has
no knowledge of any existing or imminent labor dispute by the
employees of any of its principal suppliers, manufacturers,
customers or contractors.
(xix) Absence of
Proceedings. Except as
disclosed in the Registration Statement, the General Disclosure
Package and the Prospectus, there is no action, suit, proceeding,
inquiry or investigation before or brought by any Governmental
Entity now pending or, to the knowledge of the Company, threatened
against the Company or any of its subsidiaries, which would
reasonably be expected to, singly or in the aggregate, result in a
Material Adverse Effect, or which would reasonably be expected to,
singly or in the aggregate, materially and adversely affect the
consummation of the transactions contemplated in this Agreement or
the performance by the Company of its obligations
hereunder.
(xx) Accuracy of
Exhibits. There are no material
contracts or documents which are required to be described in the
Registration Statement, the General Disclosure Package or the
Prospectus or to be filed as exhibits to the Registration Statement
which have not been so described and filed as
required.
(xxi) Absence of Further
Requirements. No filing with,
or authorization, approval, consent, license, order, registration,
qualification or decree of, any Governmental Entity is necessary or
required for the performance by the Company of its obligations
hereunder, in connection with the offering or sale of the
Securities hereunder or the consummation of the transactions
contemplated by this Agreement, except such as have been already
obtained or as may be required under the 1933 Act, the 1933 Act
Regulations, the 1934 Act, the 1934 Act Regulations, the rules of
the NASDAQ Stock Market LLC, state securities laws or the rules of
the Financial Industry Regulatory Authority, Inc.
(“FINRA”).
No consent, approval, authorization or order of, or filing,
notification or registration with, the NASDAQ Capital Market is
required for the listing and trading of the shares of Common Stock
on the NASDAQ Capital Market, except such as will have been
obtained or made on or prior to the Closing
Date.
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(xxii) Possession of Licenses
and Permits. The Company and
each of its subsidiaries possesses such permits, licenses,
certificates, approvals, clearances, consents and other
authorizations (collectively, “Governmental
Licenses”) issued by the
appropriate Governmental Entities necessary to conduct the business
now operated by them, except where the failure so to possess would
not reasonably be expected to, singly or in the aggregate, result
in a Material Adverse Effect. The Company and each of its
subsidiaries is in compliance with the terms and conditions of all
Governmental Licenses and, to the Company’s knowledge, no
event has occurred which allows, or after notice or lapse of time
would allow, revocation or termination thereof or result in any
other material impairment of the rights of the holder of any
Government License, except where the failure so to comply would not
reasonably be expected to, singly or in the aggregate, result in a
Material Adverse Effect. All of the Governmental Licenses are valid
and in full force and effect. Neither the Company or any of its
subsidiaries (a) has received notice of any ongoing claim, action,
suit, proceeding, hearing, enforcement, investigation, arbitration
or other action from any U.S. or non-U.S. Governmental Entity or
third party alleging that any product, operation or activity is in
violation of any Governmental Licenses and has no knowledge that
any such Governmental Entity or third party is considering any such
claim, litigation, arbitration, action, suit, investigation or
proceeding; (b) has received notice that any Governmental Entity
has taken, is taking or intends to take regulatory action, and has
no knowledge that any Governmental Entity is considering such
action; or (c) is a party to any corporate integrity agreement,
deferred prosecution agreement, monitoring agreement, consent
decree, settlement order, or similar agreements, or has any
reporting obligations pursuant to any such agreement, plan or
correction or other remedial measure entered into with any
Governmental Entity.
(xxiii) Title to
Property. The Company and each
of its subsidiaries has good and marketable title to all real
property owned by it and good title or valid leases to all personal
property owned by it, in each case, free and clear of all
mortgages, pledges, liens, security interests, claims, restrictions
or encumbrances (except for customary easements and rights of way)
of any kind except such as (A) are described in the
Registration Statement, the General Disclosure Package and the
Prospectus or (B) do not, singly or in the aggregate,
materially affect the value of such property and do not materially
interfere with the use made and proposed to be made of such
property by the Company and its subsidiaries; and all of the leases
and subleases material to the business of the Company and that of
its subsidiaries and under which the Company or any of its
subsidiaries holds properties described in the Registration
Statement, the General Disclosure Package or the Prospectus, are in
full force and effect, and neither the Company or any of its
subsidiaries has received any written notice of any material claim
of any sort that has been asserted by anyone adverse to the rights
of the Company or any of its subsidiaries under any of the leases
or subleases mentioned above, or affecting or questioning the
rights of the Company or any of its subsidiaries to the continued
possession of the leased or subleased premises under any such lease
or sublease.
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(xxiv) Possession of
Intellectual Property. Except
as would not reasonably be expected to have a Material Adverse
Effect, (i) the Company and each of its subsidiaries owns all
right, title and interest in or otherwise have the right to use all
patents, inventions, copyrights, know-how (including trade secrets
and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures), trademarks,
service marks, trade names and other intellectual property rights
(collectively, “Intellectual
Property”) that is
necessary for, used or held for use in, or otherwise exploited in
connection with, the conduct of the business now operated by them
and as proposed to be operated, and (ii) to the
Company’s knowledge, neither the Company nor any of its
subsidiaries is infringing, misappropriating, diluting or otherwise
violating the Intellectual Property of any third party. Except as
disclosed in the Registration Statement, the General Disclosure
Package and the Prospectus or as would not reasonably be expected
to have a Material Adverse Effect, (i) no action, suit, claim,
or other proceeding is pending, or to the Company’s
knowledge, is threatened, alleging that the Company or any of its
subsidiaries is infringing, misappropriating, diluting, or
otherwise violating the Intellectual Property of any third party in
any respect, (ii) to the Company’s knowledge, no third
party is infringing, misappropriating, diluting, or otherwise
violating the Intellectual Property of the Company or any of its
subsidiaries in any respect, and (iii) no action, suit, claim,
or other proceeding is pending, or to the Company’s
knowledge, is threatened, challenging the validity, enforceability,
scope, registration, ownership or use of any Intellectual Property
of the Company or any of its subsidiaries that is, singly or in the
aggregate, necessary to its business (with the exception of office
actions in connection with applications for the registration or
issuance of such Intellectual Property).
(xxv) Environmental
Laws. Except as described in
the Registration Statement, the General Disclosure Package and the
Prospectus, neither the Company nor any of its subsidiaries is in
violation of any statute, rule, regulation, decision or order of
any governmental agency or body or any court, relating to the use,
disposal or release of hazardous or toxic substances or relating to
the protection or restoration of the environment or human exposure
to hazardous or toxic substances (collectively,
“Environmental
Laws”), operates any real
property contaminated with any substance that is subject to any
Environmental Laws, is liable for any off-site disposal or
contamination pursuant to any Environmental Laws, or is subject to
any claim relating to any Environmental Laws, which violation,
contamination, liability or claim would individually or in the
aggregate have a Material Adverse Effect; and the Company is not
aware of any pending investigation which might lead to such a
claim.
(xxvi) Disclosure
Controls. Except as described
in the Registration Statement, the General Disclosure Package and
the Prospectus, the Company maintains an effective system of
“disclosure controls and procedures” (as defined in
Rule 13a-15(e) of the Exchange Act) that complies with the
requirements of the Exchange Act and that has been designed to
ensure that information required to be disclosed by the Company in
reports that it files or submits under the Exchange Act is
recorded, processed, summarized and reported within the time
periods specified in the Commission’s rules and forms,
including controls and procedures designed to ensure that such
information is accumulated and communicated to the Company’s
management as appropriate to allow timely decisions regarding
required disclosure.
(xxvii) Accounting
Controls. Except as described
in the Registration Statement, the General Disclosure Package and
the Prospectus, the Company maintains effective internal control
over financial reporting (as defined under Rule 13a-15 and 15d-15
of the 1934 Act Regulations) and a system of internal 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; (D) the recorded accountability for
assets is compared with the existing assets at reasonable intervals
and appropriate action is taken with respect to any differences and
(E) the interactive data in eXtensible Business Reporting Language
incorporated by reference in the Registration Statement, the
General Disclosure Package and the Prospectus fairly presents the
information called for in all material respects and is prepared in
accordance with the Commission’s rules and guidelines
applicable thereto. Except as described in the Registration
Statement, the General Disclosure Package and the Prospectus, since
the end of the Company’s most recent audited fiscal year,
there has been (1) no material weakness in the Company’s
internal control over financial reporting (whether or not
remediated) and (2) no change in the Company’s internal
control over financial reporting that has materially affected, or
is reasonably likely to materially affect, the Company’s
internal control over financial reporting.
9
(xxviii) Payment of
Taxes. All United States
federal income tax returns of the Company and each of its
subsidiaries required by law to be filed have been filed and all
taxes shown by such returns or otherwise assessed, which are due
and payable, have been paid, except assessments against which
appeals have been or will be promptly taken and as to which
adequate reserves have been provided other than as would not
reasonably be expected to, singly or in the aggregate, have a
Material Adverse Effect. The Company and each of its subsidiaries
has filed all other tax returns that are required to have been
filed by them pursuant to applicable foreign, state, local or other
law except insofar as the failure to file such returns would not
result in a Material Adverse Effect, and has paid all taxes due
pursuant to such returns or pursuant to any assessment received by
the Company or any such subsidiary, except for such taxes, if any,
as are being contested in good faith and as to which adequate
reserves have been established by the Company or any such
subsidiary, other than as would not reasonably be expected to,
singly or in the aggregate, have a Material Adverse Effect. Except
as disclosed in the Registration Statement, the General Disclosure
Package and the Prospectus, the charges, accruals and reserves on
the books of the Company in respect of any income and corporation
tax liability for any years not finally determined are believed to
be adequate to meet any assessments or re-assessments for
additional income tax for any years not finally determined, except
to the extent of any inadequacy that would not reasonably be
expected to result in a Material Adverse
Effect.
(xxix) Insurance.
The Company carries or is entitled to the benefits of insurance,
with reputable insurers, in such amounts and covering such risks as
is reasonably prudent and customary in the businesses in which it
is engaged, and all such insurance is in full force and effect. The
Company has no reason to believe that it will not be able
(A) to renew its existing insurance coverage as and when such
policies expire or (B) to obtain comparable coverage from
similar institutions as may be necessary or appropriate to conduct
its business as now conducted and at a cost that would not result
in a Material Adverse Effect. The Company has not been denied the
issuance of any material insurance policies which it has sought or
for which it has applied in the prior three years, except for any
applications still pending.
(xxx) Investment Company
Act. The Company is not
required to register as an “investment company” under
the Investment Company Act of 1940, as amended (the
“1940
Act”).
(xxxi) Absence of
Manipulation. Neither the
Company nor any affiliate of the Company has taken, nor will the
Company or any affiliate take, directly or indirectly, any action
which is designed, or would reasonably be expected, to cause or
result in, or which constitutes, the stabilization or manipulation
of the price of any security of the Company to facilitate the sale
or resale of the Securities.
(xxxii) No
Integration. The Company has
not sold or issued any securities that would be integrated with the
offering of the Common Stock contemplated by this Agreement
pursuant to the Securities Act, the rules and regulations
thereunder or the interpretations thereof by the
Commission.
10
(xxxiii) ERISA;
Labor. Other than as would not,
singly or in the aggregate, reasonably be expected to result in a
Material Adverse Effect and except as disclosed in the Registration
Statement, the General Disclosure Package and the Prospectus,
(i) each “employee benefit plan” (as defined in
Section 3(3) of ERISA), for which the Company would have any
liability (whether absolute or contingent) (each a
“Plan”)
is in compliance in all respects with applicable law, including,
without limitation, ERISA and the Code; and (ii) other than in
the ordinary course, neither the Company nor any trade or business,
whether or not incorporated, that, together with the Company, would
be deemed to be a “single employer” within the meaning
of Section 4001(b)(1) of ERISA or Section 414(b), 414(c),
414(m) or 414(o) of the Code has incurred or reasonably expects to
incur any liability with respect to any Plan (A) under Title
IV of ERISA or (B) in respect of any post-employment health,
medical or life insurance benefits for former, current or future
employees of the Company, except as required to avoid excise tax
under Section 4980B of the Code and except, on a case by case
basis, limited extensions of health insurance benefits (for a
period of no more than 18 months post-employment) to former
employees receiving severance payments from the Company. The
Company is not, nor at any time during the last three years has the
Company been, a party to any collective bargaining agreement or
other labor agreement with respect to employees of the Company.
There are no pending, or, to the Company’s knowledge,
threatened, activities or proceedings by any labor union or similar
entity to organize any employees of the Company. No labor dispute
with, or labor strike, work stoppage or other material labor
disturbance by, the employees of the Company exists or to the
Company’s knowledge is imminent.
(xxxiv) Foreign Corrupt
Practices Act. Neither the
Company, any of its subsidiaries nor, to the knowledge of the
Company, any director, officer, agent, employee, affiliate or other
person acting on behalf of the Company has taken any action,
directly or indirectly, that would result in a violation by such
persons of the Foreign Corrupt Practices Act of 1977, as amended,
and the rules and regulations thereunder (the
“FCPA”),
including, without limitation, making use of the mails or any means
or instrumentality of interstate commerce corruptly in furtherance
of an offer, payment, promise to pay or authorization of the
payment of any money, or other property, gift, promise to give, or
authorization of the giving of anything of value to any
“foreign official” (as such term is defined in the
FCPA) or any foreign political party or official thereof or any
candidate for foreign political office, in contravention of the
FCPA and the Company, its subsidiaries and, to the knowledge of the
Company, its affiliates have conducted their businesses in
compliance with the FCPA and have instituted and maintain policies
and procedures designed to ensure, and which are reasonably
expected to continue to ensure, continued compliance
therewith.
(xxxv) Money Laundering
Laws. The operations of the
Company and its subsidiaries are and have been conducted at all
times in material compliance with applicable financial
recordkeeping and reporting requirements of the Currency and
Foreign Transactions Reporting Act of 1970, as amended, the money
laundering statutes of all applicable jurisdictions, the rules and
regulations thereunder and any related or similar rules,
regulations or guidelines, issued, administered or enforced by any
Governmental Entity (collectively, the “Money
Laundering Laws”); and no
action, suit or proceeding by or before any Governmental Entity
involving the Company or any of its subsidiaries with respect to
the Money Laundering Laws is pending or, to the knowledge of the
Company, threatened.
(xxxvi) OFAC.
Neither the Company, any of its subsidiaries nor, to the knowledge
of the Company, its directors, officers, agents, employees,
affiliates or representatives (each, a “Person”
) are currently the subject of sanctions administered or enforced
by the United States Government, including, without limitation, the
U.S. Department of the Treasury’s Office of Foreign Assets
Control (“OFAC”),
the United Nations Security Council, the European Union, Her
Majesty’s Treasury, or other relevant sanctions authority
applicable to the Company and its subsidiaries (collectively,
“Sanctions”),
nor is the Company or any of its subsidiaries located, organized or
resident in a country or territory that is the subject of
Sanctions; and the Company does not intend to, directly or
indirectly, use the proceeds of the sale of the Securities, or
lend, contribute or otherwise make available such proceeds to any
subsidiaries, joint venture partners or other Person, to fund any
activities of or business with any Person, or in any country or
territory, that, at the time of such funding, is the subject of
Sanctions or in any other manner that will result in a violation by
any Person (including any Person participating in the transaction,
whether as underwriter, advisor, investor or otherwise) of
Sanctions.
11
(xxxvii) Lending
Relationship. Except
as disclosed in the Registration Statement, the General Disclosure
Package and the Prospectus, the Company does not have
any material lending or other relationship with any banking or
lending affiliate of any Underwriter.
(xxxviii) Statistical and
Market-Related Data. Any
statistical and market-related data included in the Registration
Statement, the General Disclosure Package or the Prospectus are
based on or derived from sources that the Company believes, after
reasonable inquiry, to be reliable and accurate in all material
respects.
(xxxix) Accuracy of
Descriptions. The statements
set forth in the Registration Statement, 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 is an accurate, complete
and fair summary.
(xl) Stock Exchange
Listing. The Common Stock is
registered pursuant to Section 12(b) or 12(g) of the Exchange Act
and is listed on the NASDAQ Capital Market; the Company has taken
no action designed to, or likely to have the effect of, terminating
the registration of the Common Stock under the Exchange Act or
delisting the Common Stock from the NASDAQ Capital Market; the
Company has not received any notice that it is out of compliance
with the listing or maintenance requirements of the NASDAQ Capital
Market and the Company is in material compliance with all such
listing and maintenance requirements; and the Company has not
received any notification that the Commission or the NASDAQ Capital
Market is contemplating terminating the registration of the Common
Stock under the Exchange Act or delisting the Common Stock from the
NASDAQ Capital Market.
(xli) Maintenance of
Rating. The Company does not
have any securities rated by any “nationally recognized
statistical rating organization” (as defined for purposes of
Rule 436(g) under the 1933 Act).
(xlii) Related Party
Transactions. There are no
business relationships or related-party transactions involving the
Company, any of its subsidiaries or any other person required to be
described in the Registration Statement, any preliminary
prospectus, the Prospectus and the General Disclosure Package which
have not been described as required. The General Disclosure Package
contains in all material respects the same description of the
matters set forth in the preceding sentence contained in the
Prospectus.
(xliii) Brokers.
Except for the underwriting discounts and commissions payable to
the Underwriters as described in the Registration Statement, the
General Disclosure Package and the Prospectus, there is no broker,
finder or other party that is entitled to receive from the Company
any brokerage or finder’s fee or other fee or commission as a
result of any transactions contemplated by this
Agreement.
(xliv) No
Stabilization. The Company has
not taken, directly or indirectly, any action designed to or that
could reasonably be expected to cause or result in any
stabilization or manipulation of the price of the
Securities.
(xlv) [Reserved.]
12
(xlvi) Forward-Looking
Statements. No forward-looking
statement (within the meaning of Section 27A of the Securities Act)
contained in the Registration Statement, the General Disclosure
Package or the Prospectus has been made or reaffirmed by the
Company without a reasonable basis or has been disclosed by the
Company other than in good faith.
(xlvii) ▇▇▇▇▇▇▇▇-▇▇▇▇▇
Act. There is and has been no
failure on the part of the Company or, to the knowledge of the
Company, any of the Company’s directors or officers, in their
capacities as such, to comply with any applicable provision of the
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 and the rules and regulations
promulgated in connection therewith, including Section 402 related
to loans.
(xlviii) FINRA
Affiliations. There are no
affiliations or associations between any member of FINRA and any of
the Company’s officers or directors or, the Company’s
knowledge, 5% or greater securityholders.
(b) Representations and Warranties
by the Selling Stockholders. Each Selling Stockholder severally and not jointly
represents and warrants to each Underwriter as of the date hereof,
the Applicable Time, and the Closing Time (as defined below), and
agrees with each Underwriter, as follows:
(i) Valid
Title. Such Selling Stockholder
has, and immediately prior to the Closing Date (as defined in
Section 2 hereof) the Selling Stockholder will have, good and valid
title to, or a valid “security entitlement” within the
meaning of Section 8-501 of the New York Uniform Commercial Code
(the “UCC”)
in respect of, the Securities to be sold by the Selling Stockholder
hereunder on such date, free and clear of all liens, security
interests, encumbrances, equities or claims of any kind, other than
pursuant to this Agreement and the Custody Agreement; upon payment
for the Securities to be sold by such Selling Stockholder pursuant
to this Agreement, delivery of such shares, as directed by the
Underwriters, to Cede & Co. (“Cede”)
or such other nominee as may be designated by the Depository Trust
Company (“DTC”)
(unless delivery of such shares is unnecessary because such shares
are already in possession of Cede or such nominee), registration of
such shares in the name of Cede or such other nominee (unless
registration of such shares is unnecessary because such shares are
already registered in the name of Cede or such nominee), and the
crediting of such shares on the books of DTC to securities accounts
of the Underwriters (assuming that neither DTC nor any such
Underwriter has notice of any “adverse claim,” within
the meaning of the UCC to such shares), (A) DTC shall be a
“protected purchaser” of such shares within the meaning
of Section 8-303 of the UCC and will acquire its interest in the
shares (including without limitation, all rights that such Selling
Stockholder had or has the power to transfer in such shares) free
and clear of any “adverse claim” within in the meaning
of Section 8-102 of the UCC, (B) under Section 8-501 of the UCC,
the Underwriters will acquire a valid security entitlement in
respect of such shares and (C) no action based on any
“adverse claim” within the meaning of Section 8-102 of
the UCC to such shares may be successfully asserted against the
Underwriters with respect to such security entitlement; for
purposes of this representation, such Selling Stockholder may
assume that when such payment, delivery (if necessary) and
crediting occur, (x) such shares will have been registered in
the name of Cede or another nominee designated by DTC, in each case
on the Company’s share registry in accordance with the
Company’s charter, bylaws and applicable law, (y) DTC will be
registered as a “clearing corporation” within the
meaning of Section 8-102 of the UCC and (z) appropriate entries to
the accounts of the several Underwriters on the records of DTC will
have been made pursuant to the UCC.
(ii) Underwriting
Agreement. This Agreement has
been duly authorized, executed and delivered by or on behalf of
such Selling Stockholder.
13
(iii) Custody
Agreement. Such Selling
Stockholder has duly and irrevocably authorized, executed and
delivered a custody agreement, in substantially the form heretofore
delivered by the Underwriters (the “Custody
Agreement”), with Direct
Transfer LLC as custodian for such Selling Stockholder (in such
capacity, the “Custodian”),
pursuant to which such Selling Stockholder has placed in custody
with the Custodian for delivery under this Agreement certificates
for all of the Securities to be sold by such Selling Stockholder
hereunder, in negotiable and suitable form for transfer or delivery
or accompanied by duly executed instruments of transfer or
assignment in blank; and the Custody Agreement is a valid and
binding agreement of such Selling Stockholder, enforceable against
such Selling Stockholder in accordance with its terms. The
Custodian is authorized to deliver the Securities to be sold by
such Selling Stockholder hereunder and to accept payment
therefor.
(iv) Due Authorization; No
Conflict; No Consent. Such
Selling Stockholder has full right, power and authority to enter
into this Agreement and the Custody Agreement; the execution,
delivery and performance of this Agreement and the Custody
Agreement by such Selling Stockholder, the consummation by such
Selling Stockholder of the transactions contemplated hereby and
thereby and the compliance by such Selling Stockholder with its
obligations hereunder and thereunder have been duly authorized and
do not and will not (with or without notice or lapse of time or
both) conflict with or result in a breach or violation of any of
the terms or provisions of, constitute a default under, or give
rise to the creation or imposition of any material lien,
encumbrance, security interest, claim or charge upon the Securities
to be sold by such Selling Stockholder hereunder or any other
property or assets of such Selling Stockholder pursuant to, any
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which such Selling Stockholder is a
party or by which the Selling Stockholder is bound or to which any
of the property or assets of such Selling Stockholder is subject,
nor will such actions result in any violation of the provisions of
the charter or by-laws (or analogous governing instruments, as
applicable), the articles of partnership or the deed of trust, as
the case may be, of such Selling Stockholder or any law, statute,
rule, regulation, judgment, order or decree of any court or
governmental agency or body, domestic or foreign, having
jurisdiction over such Selling Stockholder or any property or
assets of such Selling Stockholder; and, except for the
registration of the Securities under the Securities Act and such
consents, approvals, authorizations, registrations or
qualifications as may be required under applicable state securities
laws, or as may be required under laws of foreign jurisdictions, or
the rules of NASDAQ or FINRA in connection with the purchase and
distribution of the Securities by the Underwriters or except such
as have been already been obtained, no consent, approval,
authorization or order of, or filing or registration with, any such
court or governmental or non-governmental agency or body is
required for the execution, delivery and performance of this
Agreement or the Custody Agreement by such Selling Stockholder, and
the consummation by such Selling Stockholder of the transactions
contemplated hereby and thereby.
(v) Obligations
Irrevocable. The Securities
represented by the certificates held in custody under the Custody
Agreement for such Selling Stockholder are subject to the interests
of the Underwriters hereunder; the arrangements made by such
Selling Stockholder for such custody and the appointment of the
Custodian are irrevocable; the obligations of such Selling
Stockholder hereunder shall not be terminated by operation of law
(whether by death or incapacity of any individual Selling
Stockholder or, in the case of an estate or trust Selling
Stockholder, by the death or incapacity of any executor or trustee
thereof or the termination of such trust or estate, or in the case
of a partnership or corporation Selling Stockholder, by the
dissolution or liquidation of such partnership or corporation, or
by the occurrence of any other event); and if any individual
Selling Stockholder or trustee or executor of any estate or trust
Selling Stockholder should die or become incapacitated, if any
estate or trust Selling Stockholder should be terminated, if any
partnership or corporation Selling Stockholder should be dissolved
or liquidated or if any other event should occur before the
delivery of the Securities to the Underwriters hereunder,
certificates for the Securities to be sold by such Selling
Stockholder shall be delivered on behalf of such Selling
Stockholder in accordance with the terms and conditions of this
Agreement and by the Custodian under the Custody Agreement shall be
as valid, in each such case as if such death, incapacity,
termination, dissolution, liquidation or other event had not
occurred, whether or not the Custodian or any of them shall have
notice of such death, incapacity, termination, dissolution,
liquidation or other event.
14
(vi) No Material
Misstatements. At the
respective times the Registration Statement and any amendments
thereto became or become effective, at the date of this Agreement
and at the Closing Date, the Registration Statement and any
amendments thereto did not and will not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading; and the General Disclosure Package, the
Prospectus and any amendments or supplements thereto, at time the
Prospectus or any amendment or supplement thereto was issued and at
the Applicable Time and at the Closing Date, did not and will not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under
which they were made, not misleading; provided, however, that the foregoing representations and
warranties in this paragraph (b)(vi) shall not apply to information
contained in or omitted from the Registration Statement, the
General Disclosure Package or the Prospectus in reliance upon and
in conformity with written information furnished to the Company by
the Underwriters specifically for inclusion therein, which
information the parties hereto agree is limited to the
Underwriter’s Information or any Selling Stockholder
Information (as defined below) and or provided, further, that the representations and warranties of each
of the Selling Stockholders set forth in this subsection vi
apply only to statements or omissions
made in reliance upon and in conformity with information relating
to such Selling Stockholder furnished in writing by or on behalf of
such Selling Stockholder expressly for use in the Registration
Statement, the General Disclosure Package, any Prospectus or any
amendment or supplement thereto, it being understood and agreed
that the only information furnished by such Selling Stockholder
consists of the name of such Selling Stockholder, the number of
offered Securities and the address and other information with
respect to such Selling Stockholder (excluding percentages) which
appear in the Registration Statement, General Disclosure Package,
and the Prospectus in the table (and corresponding footnotes) under
the captions “Selling Security Holders” and
“Selling Stockholders” (with respect to each Selling
Stockholder, the “Selling
Stockholder Information”)
therein; each Selling Stockholder is not and was not prompted to
sell the Securities to be sold by such Selling Stockholder
hereunder by any information concerning the Company or any
subsidiary of the Company that is not set forth in the Registration
Statement or the Prospectus.
(vii) No Material,
Non-Public Information. Such
Selling Stockholder is not prompted to sell its Securities pursuant
to this Agreement by any material information concerning the
Company or its subsidiaries that has not been disclosed in the
General Disclosure Package.
(viii) No
Stabilization. Such Selling
Stockholder has not taken, directly or indirectly, any action
designed or intended to stabilize or manipulate the price of any
security of the Company, or which caused or resulted in, or which
might reasonably be expected to cause or result in, the
stabilization or manipulation of the price of any security of the
Company.
(ix) Associated
Persons. Neither the Selling
Stockholder nor any of its affiliates (within the meaning of FINRA
Rule 5121(f)(1)) directly or indirectly controls, is controlled by,
or is under common control with, or is an associated person (within
the meaning of Article I, Section 1(ee) of the By-laws of FINRA)
of, any member firm of FINRA.
15
(c) Certificates.
Any certificate signed by any officer of the Company or by or on
behalf of a Selling Stockholder and delivered to the
Representatives or to counsel for the Underwriters shall be deemed
a representation and warranty by the Company (and not by such
officer in his or her personal capacity) or such Selling
Stockholder, as applicable, to each Underwriter as to the matters
covered thereby.
SECTION 2. Purchase of the
Securities by the Underwriters.
(a) Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions
herein set forth, each Selling Stockholder, severally and not
jointly, agrees to sell to each Underwriter, severally and not
jointly, and each Underwriter, severally and not jointly, agrees to
purchase from the Selling Stockholders, at the price per share set
forth in Schedule A
hereto, that number of Securities set
forth opposite the name of such Selling Stockholder in
Schedule
B hereto, in each case by a
fraction of the numerator of which is the number of shares of
Securities set forth opposite the name of such Underwriter opposite
the name of such Underwriter in Schedule A
hereto and the denominator of which is
the total number of shares of Securities, plus any additional
number of Securities which such Underwriter may become obligated to
purchase pursuant to the provisions of Section 12
hereof.
(b) [Reserved].
(c) Payment. Payment of the purchase price for, and delivery
of, the Securities shall be made at the offices of ▇▇▇▇▇▇▇ Procter
LLP, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, or at such other place
as shall be agreed upon by the Representatives, the Company and the
Selling Stockholders at 10:00 A.M. (New York City time) on June 17,
2019 (such date, the “Closing
Date”) (unless postponed
in accordance with the provisions of Section 10
hereof), or such other time not later
than ten business days after such date as shall be agreed upon by
the Representatives, the Company and the Selling Stockholders (such
time and of payment and delivery on the Closing Date being herein
called “Closing
Time”). Delivery of the
Securities shall be made through the facilities of DTC unless the
Representatives shall otherwise instruct.
Payment
shall be made to each of the Selling Stockholders by wire transfer
of immediately available funds to bank accounts specified by each
of the Selling Stockholders. It is understood that each Underwriter
has authorized the Representatives, for its account, to accept
delivery of, receipt for, and make payment of the purchase price
for, the Securities, which it has agreed to purchase. The
Representatives, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of
the purchase price for the Securities to be purchased by any
Underwriter whose funds have not been received by the Closing Time,
but such payment shall not relieve such Underwriter from its
obligations hereunder.
(d) Denominations;
Registration. The Securities
shall be in such denominations and registered in such names as the
Representatives may request in writing at least one full business
day before the Closing Time.
SECTION 3. Covenants of the
Company. The Company covenants
with each Underwriter as follows:
16
(a) Compliance with Securities
Regulations and Commission Requests. The Company, subject to Section 3(b)
hereof, will comply with the
requirements of Rule 430B, and will notify the Representatives
promptly, and confirm the notice in writing, (i) when any
post-effective amendment to the Registration Statement shall have
been filed or been declared effective or any amendment or
supplement to the Prospectus, any Issuer Free Writing Prospectus
shall have been filed or distributed, (ii) of the receipt of
any comments from the Commission, (iii) of any request by the
Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus, including any document
incorporated by reference therein, or for additional information,
including, but not limited to, any request for information
concerning any oral or written communication with potential
investors and undertaken in reliance on Section 5(d) of the
Securities Act, (iv) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration
Statement or any post-effective amendment or of any order
preventing or suspending the use of any preliminary prospectus, the
Prospectus, or of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceedings for any of such
purposes or of any examination pursuant to Section 8(d)
or 8(e)
of the 1933 Act concerning the
Registration Statement, (v) of the occurrence of any event or
development at any time when a prospectus relating to the
Securities is (or, but for the exception afforded by Rule 172 of
the 1933 Act Regulations (“Rule
172”), would be) required
by the 1933 Act to be delivered in connection with sales of the
Securities (the “Prospectus
Delivery Period”) as a
result of which the Prospectus, the General Disclosure Package, any
Issuer Free Writing Prospectus as then amended or supplemented
would include any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances existing when the
Prospectus, the General Disclosure Package, any such Issuer Free
Writing Prospectus is delivered to a purchaser, not misleading; and
(vi) if the Company becomes the subject of a proceeding under
Section 8A of the 1933 Act in connection with the offering of
the Securities. The Company will effect all filings required under
Rule 424(b), in the manner and within the time period required by
Rule 424(b) (without reliance on Rule 424(b)(8)), and will take
such steps as it deems necessary to ascertain promptly whether the
form of prospectus transmitted for filing under Rule 424(b) was
received for filing by the Commission and, in the event that it was
not, it will promptly file such prospectus. The Company will use
commercially reasonable efforts to prevent the issuance of any such
order suspending the effectiveness of the Registration Statement,
preventing or suspending the use of any preliminary prospectus, the
Prospectus or suspending any such qualification of the Securities
and, if any such order is issued, will use commercially reasonable
efforts to obtain as soon as possible the withdrawal
thereof.
(b) Continued Compliance with
Securities Laws. The Company
will comply with the 1933 Act and the 1933 Act Regulations during
the Prospectus Delivery Period so as to permit the completion of
the distribution of the Securities as contemplated in this
Agreement and in the Registration Statement, the General Disclosure
Package and the Prospectus. If at any time during the Prospectus
Delivery Period any event shall occur or condition shall exist as a
result of which it is necessary, in the opinion of counsel for the
Underwriters or for the Company, to (i) amend the Registration
Statement in order that the Registration Statement will not include
an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) amend or supplement
the General Disclosure Package or the Prospectus in order that the
General Disclosure Package or the Prospectus, as the case may be,
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 not misleading in the light of the circumstances existing
at the time it is delivered to a purchaser or (iii) amend the
Registration Statement or amend or supplement the General
Disclosure Package or the Prospectus, as the case may be, in order
to comply with the requirements of the 1933 Act or the 1933 Act
Regulations, the Company will promptly (A) give the
Representatives notice of such event, (B) prepare any
amendment or supplement as may be necessary to correct such
statement or omission or to make the Registration Statement, the
General Disclosure Package or the Prospectus comply with such
requirements and, a reasonable amount of time prior to any proposed
filing or use, furnish the Representatives with copies of any such
amendment or supplement and (C) file with the Commission any
such amendment or supplement; provided that the Company shall not file or use any such
amendment or supplement to which the Representatives or counsel for
the Underwriters shall reasonably object unless the Company
reasonably believes that the failure to file or use such amendment
or supplement would constitute a violation of law or subject it to
liability. The Company will furnish to the Underwriters such number
of copies of such amendment or supplement as the Underwriters may
reasonably request. The Company has given the Representatives
notice of any filings made pursuant to the 1934 Act or 1934 Act
Regulations within 48 hours prior to the Applicable Time; the
Company will give the Representatives notice of its intention to
make any such filing from the Applicable Time to the Closing Time
and will furnish the Representatives with copies of any such
documents a reasonable amount of time prior to such proposed
filing, as the case may be, and will not file or use any such
document to which the Representatives or counsel for the
Underwriters shall reasonably object unless the Company reasonably
believes that the failure to file or use such amendment or
supplement would constitute a violation of law or subject it to
liability.
17
(c) Delivery of Registration
Statements. The Company has
furnished or will deliver to the Representatives and to counsel for
the Underwriters, upon request, without charge, signed copies of
the Registration Statement as originally filed and each amendment
thereto (including exhibits filed therewith) and signed copies of
all consents and certificates of experts, and will also deliver to
the Representatives, upon request, without charge, a conformed copy
of the Registration Statement as originally filed and each
amendment thereto (without exhibits) for each of the Underwriters.
The copies of the Registration Statement and each amendment thereto
furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to ▇▇▇▇▇, except to the extent permitted by Regulation
S-T.
(d) Delivery of
Prospectuses. The Company has
delivered to each Underwriter, without charge, as many copies of
each preliminary prospectus as the Representatives have reasonably
requested on behalf of the Underwriters, and the Company hereby
consents to the use of such copies for purposes permitted by the
1933 Act. The Company will furnish to each Underwriter, without
charge, during the period when a prospectus relating to the
Securities is (or, but for the exception afforded by Rule 172,
would be) required to be delivered under the 1933 Act, such number
of copies of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request. The Prospectus and any
amendments or supplements thereto furnished to the Underwriters
will be identical to the electronically transmitted copies thereof
filed with the Commission pursuant to ▇▇▇▇▇, except to the extent
permitted by Regulation S-T.
(e) Blue Sky
Qualifications. The Company
will use its commercially reasonable efforts, in cooperation with
the Underwriters, to qualify the Securities for offering and sale
under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as the Representatives may
designate and to maintain such qualifications in effect so long as
required to complete the distribution of the Securities;
provided, however, that the Company shall not be obligated to file
any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself
to taxation in respect of doing business in any jurisdiction in
which it is not otherwise so subject.
(f) Rule 158. The Company will timely file such reports
pursuant to the 1934 Act as are necessary in order to make
generally available to its securityholders as soon as practicable
an earnings statement for the purposes of, and to provide to the
Underwriters the benefits contemplated by, the last paragraph of
Section 11(a) of the 1933 Act.
(g) [Reserved.]
(h) Listing. The Company will use its commercially reasonable
efforts to maintain the listing of the Common Stock (including the
Securities) on the NASDAQ Stock Market LLC.
18
(i) Restriction on Sale of
Securities. During a period of
60 days from the date of the Prospectus (the
“Lock-Up
Period”), the Company
will not, without the prior written consent of the Representatives,
(i) directly or indirectly, offer, pledge, sell, contract to
sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase
or otherwise transfer or dispose of any shares of Common Stock or
any securities convertible into or exercisable or exchangeable for
shares of Common Stock or file any registration statement under the
1933 Act with respect to any of the foregoing or (ii) enter
into any swap or any other agreement or any transaction that
transfers, in whole or in part, directly or indirectly, the
economic consequence of ownership of shares of Common Stock,
whether any such swap or transaction described in
clause
(i) or (ii) above
is to be settled by delivery of shares of Common Stock or such
other securities, in cash or otherwise. The foregoing sentence
shall not apply to (A) the Securities to be sold hereunder,
(B) any shares of Common Stock issued by the Company upon the
exercise of an option or warrant or the conversion of a security
outstanding on the date hereof and referred to in the Registration
Statement, the General Disclosure Package and the Prospectus, (C)
shares of Common Stock issued by the Company as a result of
anti-dilution provisions in the Company’s amended and
restated certificate of incorporation as then in effect, or
(D) any shares of Common Stock issued or options to purchase
Common Stock granted pursuant to employee benefit plans of the
Company referred to in the Registration Statement, the General
Disclosure Package and the Prospectus; provided that, in each case,
the recipient of such shares of Common Stock or other securities is
subject to substantially the same restrictions as those contained
in this Section 3(i).
(j) Reporting
Requirements. The Company,
during the period when a Prospectus relating to the Securities is
(or, but for the exception afforded by Rule 172, would be) required
to be delivered under the 1933 Act, will file all documents
required to be filed with the Commission pursuant to the 1934 Act
within the time periods required by the 1934 Act and 1934 Act
Regulations.
(k) Issuer Free Writing
Prospectuses. The Company
agrees that, unless it obtains the prior written consent of the
Representatives, it will not make any offer relating to the
Securities that would constitute an Issuer Free Writing Prospectus
or that would otherwise constitute a “free writing
prospectus,” or a portion thereof, required to be filed by
the Company with the Commission or retained by the Company under
Rule 433; provided that the Representatives will be deemed to have
consented to the Issuer Free Writing Prospectuses listed on
Schedule
C-2 hereto and any “road
show that is a written communication” within the meaning of
Rule 433(d)(8)(i) that has been reviewed by the Representatives.
The Company represents that it has treated or agrees that it will
treat each such free writing prospectus consented to, or deemed
consented to, by the Representatives as an “issuer free
writing prospectus,” as defined in Rule 433. The Company
represents that it has complied and will comply with the applicable
requirements of Rule 433 with respect thereto, including timely
filing with the Commission where required, legending and record
keeping. If at any time following issuance of an Issuer Free
Writing Prospectus there occurred or occurs an event or development
as a result of which such Issuer Free Writing Prospectus conflicted
or would conflict with the information contained in the
Registration Statement, any preliminary prospectus or the
Prospectus 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 existing at that subsequent time, not misleading,
the Company will promptly notify the Representatives and will
promptly amend or supplement, at its own expense, such Issuer Free
Writing Prospectus to eliminate or correct such conflict, untrue
statement or omission.
SECTION 4. Covenants of the
Selling Stockholders. Each
Selling Stockholder covenants with each Underwriter as
follows:
(a) Lock-up. Such Selling Stockholder will execute the
lock-up letter substantially in the form of Exhibit A
hereto.
(b) No
Stabilization. Such Selling
Stockholder will not take, directly or indirectly, any action
designed or intended to stabilize or manipulate the price of any
security of the Company, or that might reasonably be expected to
cause or result in the stabilization or manipulation of the price
of any security of the Company.
(c) Forms W-8 and
W-9. Such Selling Stockholder
will deliver to the Underwriters on or prior to the Closing Date a
properly completed and executed United States Treasury Department
Form W-8 (if the Selling Stockholder is a non-United States person)
or Form W-9 (if the Selling Stockholder is a United States person)
or such other applicable form or statement specified by Treasury
Department regulations in lieu thereof.
19
(d) Free Writing
Prospectuses. Such Selling
Stockholder agrees that it will not prepare or have prepared on its
behalf or use or refer to any "free writing prospectus" (as defined
in Rule 405 of the 1933 Act Regulations) and agrees that it will
not distribute any written materials in connection with the offer
or sale of the Securities.
(e) Selling Stockholder
Information. During the period
when delivery of a prospectus (or, in lieu thereof, the notice
referred to under Rule 173(a) of the 1933 Act Regulations) is
required under the Securities Act, such Selling Stockholder will
advise the Underwriters promptly, and will confirm such advice in
writing to the Underwriters, of any change in the information
relating to such Selling Stockholder in the Registration Statement,
the Prospectus or any document comprising the General Disclosure
Package.
(f) Performance of Covenants and
Satisfaction of Conditions.
Such Selling Stockholder will use his, her or its best efforts to
do and perform all things required to be done or performed under
this Agreement by such Selling Stockholder prior to each Closing
Date and to satisfy all conditions precedent to the delivery of the
Securities.
SECTION 5. Payment of
Expenses.
(a) Expenses. The Company and the Selling Stockholders will
pay or cause to be paid all expenses incident to the performance of
its obligations under this Agreement, including (i) the
preparation, printing and filing of the Registration Statement
(including financial statements and exhibits) as originally filed
and each amendment thereto, (ii) the preparation, printing and
delivery to the Underwriters of copies of each preliminary
prospectus, each Issuer 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 preparation, issuance and
delivery of the Securities pursuant to this Agreement, including
any stock or other transfer taxes and any stamp or other duties
payable upon the sale, issuance or delivery of the Securities to
the Underwriters or the sale of the Securities by the Underwriters,
(iv) the fees and disbursements of the counsel, accountants
and other advisors to the Company and the Selling Stockholders, as
applicable, (v) the qualification of the Securities under
securities laws in accordance with the provisions of
Section 3(e)
hereof, including any filing fees in
connection therewith, (vi) the fees and expenses of any
transfer agent or registrar for the Securities, (vii) the
reasonable out-of-pocket costs and expenses of the Company relating
to investor presentations or any “road show” undertaken
in connection with the marketing of the Securities, including
without limitation, expenses associated with the production of road
show slides and graphics, fees and expenses of any consultants
engaged by the Company in connection with the road show
presentations, travel and lodging expenses of the representatives
and employees of the Company and any such consultants,
(viii) the fees and expenses incurred in connection with the
listing of the Securities on the NASDAQ Stock Market LLC,
(ix) the costs and expenses (including, without limitation,
any damages or other amounts payable in connection with legal or
contractual liability) associated with the reforming of any
contracts for sale of the Securities made by the Underwriters
caused by a breach of the representation contained in the third
sentence of Section 1(a)(ii). Notwithstanding the foregoing
sentence of this Section 5(a), the Selling Stockholders shall pay
or cause to be paid (x) any fees and disbursements of counsel for
the Underwriters in connection with the qualification of the
Securities under securities laws in accordance with the provisions
of Section 3(e) hereof and in connection with the preparation of a
blue sky survey and any supplement thereto, and (y) all other
reasonable and documented out-of-pocket expenses incurred by the
Underwriters in connection with the offering of the Securities,
including travel, document production and distribution and database
and research expenses and the reasonable fees and disbursements of
the Underwriters’ outside legal counsel documented in
writing, provided however
that such expenses, fees and
disbursements reimbursable to the Underwriters (including
reasonable fees and disbursements of the Underwriters’
outside legal counsel) shall not exceed $50,000 in the
aggregate. It is understood and
agreed that except as otherwise provided in this Section 5(a), the
Underwriters shall pay all of their costs and expenses, including
fees and disbursements of their counsel, stock transfer taxes
payable on their resale of any of the Securities, travel and
lodging costs and expenses of the Representatives related to the
road show and any advertising expenses connected with any offers
made.
20
Each
Selling Stockholder will pay all fees and expenses incident to the
performance of such Selling Stockholder’s obligations under
this Agreement which are not otherwise specifically provided for
herein, including but not limited to any fees and expenses of
counsel for such Selling Stockholder and all expenses and taxes
incident to the sale and delivery of the Securities to be sold by
such Selling Stockholder to the Underwriters hereunder. The
underwriting discount associated with the sale of the Securities to
be sold by such Selling Stockholder hereunder shall be deducted
from the Selling Stockholders’ proceeds from the sale of such
Securities.
(b) Termination of
Agreement. If this Agreement is
terminated by the Representatives in accordance with the provisions
of Section 6,
Section 10(a)(i),
10(a)(iii)
or Section 13
hereof, the Company and the Selling
Stockholders shall reimburse the Underwriters for their documented
out-of-pocket expenses, including the fees and disbursements of
counsel for the Underwriters.
SECTION 6. Conditions of
Underwriters’ Obligations. The obligations of the several Underwriters
hereunder are subject to the accuracy of the representations and
warranties of the Company and the Selling Stockholders contained
herein or in certificates of any officer of the Company or by or on
behalf of each Selling Stockholder, as applicable, delivered
pursuant to the provisions hereof, to the performance by the
Company and the Selling Stockholders of the covenants and other
obligations hereunder, and to the following further
conditions:
(a) Effectiveness of Registration
Statement; Rule 430B Information. The Registration Statement, including any Rule
462(b) Registration Statement, has been declared effective and, at
the Closing Time, no stop order suspending the effectiveness of the
Registration Statement or any post-effective amendment thereto has
been issued under the 1933 Act, no order preventing or suspending
the use of any preliminary prospectus or the Prospectus has been
issued and no proceedings for any of those purposes have been
instituted or are pending or, to the Company’s knowledge,
contemplated; and the Company has complied with each request (if
any) from the Commission for additional information to the
reasonable satisfaction of counsel to the Company and counsel to
the Underwriters. A prospectus containing the Rule 430B Information
shall have been filed with the Commission in the manner and within
the time frame required by Rule 424(b) without reliance on Rule
424(b)(8) or a post-effective amendment providing such information
shall have been filed with, and declared effective by, the
Commission in accordance with the requirements of Rule
430B.
(b) Opinion of Counsel for
Company. At the Closing Time,
the Representatives shall have received the favorable opinion,
dated as of the Closing Time and relating to the Securities, of
▇▇▇▇▇▇▇ & ▇▇▇▇, S.C., counsel for the Company, in the form and
substance reasonably satisfactory to the
Representative.
(c) Opinion of Counsel for Selling
Stockholders. At the Closing
Time, the Representatives shall have received the favorable
opinion, dated as of the Closing Time and relating to the
Securities, of ▇▇▇▇▇▇, ▇▇▇▇▇ & Bockius LLP, counsel for the
Selling Stockholders, in the form and substance reasonably
satisfactory to the Representatives.
(d) Opinion of Counsel for
Underwriters. At the Closing
Time, the Representatives shall have received the favorable
opinion, dated the Closing Time, of ▇▇▇▇▇▇▇ Procter LLP, counsel
for the Underwriters, together with signed or reproduced copies of
such letter for each of the other Underwriters, in form and
substance reasonably satisfactory to the Representatives, and such
counsel shall have received such papers and information as they may
reasonably request to enable them to pass upon such
matters.
21
(e) Officers’
Certificate. At the Closing
Time, there shall not have been, since the date hereof or since the
respective dates as of which information is given in the
Registration Statement, the General Disclosure Package or the
Prospectus, any Material Adverse Effect, and the Representatives
shall have received a certificate of the Chief Executive Officer or
the President of the Company and of the chief financial or chief
accounting officer of the Company, dated the Closing Time, to the
effect that (i) there has been no such Material Adverse
Effect, (ii) the representations and warranties of the Company
in this Agreement are true and correct with the same force and
effect as though expressly made at and as of the Closing Time,
(iii) the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied
at or prior to the Closing Time, and (iv) no stop order
suspending the effectiveness of the Registration Statement under
the 1933 Act has been issued, no order preventing or suspending the
use of any preliminary prospectus or the Prospectus has been issued
and no proceedings for any of those purposes have been instituted
or are pending or, to their
knowledge, contemplated.
(f) Selling Stockholder
Certificate. Each Selling
Stockholder (shall have furnished to the Underwriters on the
Closing Date a certificate, dated such date, signed by, or on
behalf of, such Selling Stockholder stating that the
representations, warranties and agreements of such Selling
Stockholder contained herein are true and correct as of the Closing
Date and that such Selling Stockholder has complied with all
agreements contained herein to be performed by such Selling
Stockholder at or prior to the Closing Date.
(g) Accountant’s Comfort
Letter. At the time of the
execution of this Agreement, the Representatives shall have
received from Cherry Bekaert LLP a letter, dated such date, in form
and substance satisfactory to the Representatives, together with
signed or reproduced copies of such letter for each of the other
Underwriters containing statements and information of the type
ordinarily included in accountants’ “comfort
letters” to underwriters with respect to the financial
statements and certain financial information contained in the
Registration Statement, the General Disclosure Package and the
Prospectus.
(h) Bring-down Comfort
Letter. At the Closing Time,
the Representatives shall have received from Cherry Bekaert LLP a
letter, dated as of the Closing Time, to the effect that they
reaffirm the statements made in the letter furnished pursuant to
subsection (e) of this Section 6,
except that the specified date referred to shall be a date not more
than three business days prior to the Closing
Time.
(i) Transaction
Documents. At the time of the
execution of this Agreement, the Underwriters shall have received
copies of the Custody Agreement executed by each Selling
Stockholder and Custodian.
(j) Lock-up
Agreements. At the date of this
Agreement, the Representatives shall have received an agreement
substantially in the form of Exhibit A
hereto signed by the persons listed
on Schedule D
hereto.
(k) [Reserved].
(l) Additional
Documents. At the Closing Time,
the Representatives and counsel for the Underwriters shall have
been furnished with such documents and opinions as they may
reasonably require for the purpose of enabling them to pass upon
the issuance and sale of the Securities as herein contemplated, or
in order to evidence the accuracy of any of the representations or
warranties, or the fulfillment of any of the conditions, herein
contained; and all proceedings taken by the Company and the Selling
Stockholders in connection with the issuance and sale of the
Securities as herein contemplated shall be reasonably satisfactory
in form and substance to the Representatives and counsel for the
Underwriters.
22
(m) Termination of
Agreement. If any condition
specified in this Section 6
shall not have been fulfilled when and
as required to be fulfilled, this Agreement may be terminated by
the Representatives by notice to the Company and the Selling
Stockholders at any time at or prior to the Closing Time, and such
termination shall be without liability of any party to any other
party except as provided in Section 5
hereof and except that
Sections
1, 7, 8, 9, 17 and 18 shall survive any such termination and remain in
full force and effect.
(n) Delivery of
Prospectuses. The Company shall
have complied with the provisions of Section 3(d)
hereof with respect to the furnishing
of prospectuses on the business day next succeeding the date
hereof.
(o) Approval of
Listing. At the Closing Time,
the Securities shall be listed on the NASDAQ Capital
Market.
SECTION 7. Indemnification.
(a) Indemnification of
Underwriters by Company. The
Company agrees to indemnify and hold harmless each Underwriter, its
affiliates (as such term is defined in Rule 501(b) under the 1933
Act (each, an “Affiliate”)),
its selling agents and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, arising out of any
untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement (or any amendment thereto),
including the Rule 430B Information, or the omission or alleged
omission therefrom of a material fact required to be stated therein
or necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of
a material fact included (A) in any preliminary prospectus,
any Issuer Free Writing Prospectus, the General Disclosure Package
or the Prospectus (or any amendment or supplement thereto) or
(B) in any materials or information provided to investors by,
or with the prior written approval of, the Company in connection
with the marketing of the offering of the Securities
(“Marketing
Materials”), including
any roadshow or investor presentations made to investors by the
Company (whether in person or electronically), or the omission or
alleged omission in any preliminary prospectus, any Issuer Free
Writing Prospectus, the General Disclosure Package, the Prospectus
or in any Marketing Materials of a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(ii) against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or any
investigation or proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue
statement or omission; provided that (subject to Section 7(f)
below) any such settlement is effected
with the written consent of the Company;
(iii) against any and all documented out-of-pocket
expense whatsoever, as incurred (including the fees and
disbursements of one counsel (in addition to any relevant local
counsel) chosen by the Representatives), reasonably incurred in
investigating, preparing or defending against any litigation, or
any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue
statement or omission, to the extent that any such expense is not
paid under (i)
or (ii)
above;
23
provided, however,
that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of
any untrue statement or omission or alleged untrue statement or
omission made in the Registration Statement (or any amendment
thereto), including the Rule 430B Information, any preliminary
prospectus, any Issuer Free Writing Prospectus, the General
Disclosure Package or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with (x) the
Underwriter Information or (y) the Selling Stockholder
Information.
(b) Indemnification of
Underwriters by Selling Stockholders. Each of the Selling Stockholders, severally and
not jointly, agrees to indemnify and hold harmless each
Underwriter, its Affiliates, its selling agents and each person, if
any, who controls any Underwriter within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act,
against any loss, claim, damage, expense or liability whatsoever
(or any action, investigation or proceeding in respect thereof),
joint or several, to which such party may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage,
expense, liability, action, investigation or proceeding arises out
of or is based upon (i) any untrue statement or alleged untrue
statement of a material fact contained in any Preliminary
Prospectus, any Issuer Free Writing Prospectus, any “issuer
information” filed or required to be filed pursuant to Rule
433(d) of the Rules and Regulations, the Registration Statement,
the Prospectus, or in any amendment or supplement thereto or in any
Marketing Materials, or (ii) the omission or alleged omission to
state in any Preliminary Prospectus, any Issuer Free Writing
Prospectus, any “issuer information” filed or required
to be filed pursuant to Rule 433(d) of the Rules and Regulations,
the Registration Statement or the Prospectus, or in any amendment
or supplement thereto or document incorporated by reference
therein, a material fact required to be stated therein or necessary
to make the statements therein not misleading, but in each case
only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon
and in conformity with its Selling Stockholder Information, and
shall reimburse, pro rata with all other indemnifying parties based
on the aggregate number of shares of Stock sold hereunder, each
such party promptly upon demand for any legal or other expenses
reasonably incurred by that party in connection with investigating
or preparing to defend or defending against or appearing as a third
party witness in connection with any such loss, claim, damage,
liability, action, investigation or proceeding, as such fees and
expenses are incurred. The aggregate liability under this Section
of each Selling Stockholder shall be limited to an amount equal to
the aggregate gross proceeds after underwriting commissions from
the sale of Securities sold by such Selling Stockholder
hereunder.
(c) Indemnification of Company,
Directors and Officers and Selling Stockholders by
Underwriters. Each Underwriter
severally and not jointly agrees to indemnify and hold harmless the
Company, its directors, each of its officers who signed the
Registration Statement and the Selling Stockholders, and each
person, if any, who controls the Company or a Selling Stockholder
within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act against any and all loss,
liability, claim, damage and expense described in the indemnity
contained in subsection (a) of this Section, as incurred, but
only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement
(or any amendment thereto), including the Rule 430B Information,
any preliminary prospectus, any Issuer Free Writing Prospectus, the
General Disclosure Package or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with the
Underwriter Information.
24
(d) Indemnification of Company,
Directors and Officers by Selling Stockholders. Each of the Selling Stockholders, severally and
not jointly, agrees to indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration
Statement and the Selling Stockholders, and each person, if any,
who controls the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act against any and all loss,
liability, claim, damage and expense described in the indemnity
contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions, or alleged untrue
statements or omissions, made in the Registration Statement (or any
amendment thereto), including the Rule 430B Information, any
preliminary prospectus, any Issuer Free Writing Prospectus, the
General Disclosure Package or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with the
Selling Stockholder Information. The aggregate liability under this
Section 7(d) of each Selling Stockholder shall be limited to an
amount equal to the aggregate gross proceeds after underwriting
commissions from the sale of Securities sold by such Selling
Stockholder hereunder.
(e) Actions against Parties;
Notification. Each indemnified
party shall give notice as promptly as reasonably practicable to
each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to
so notify an indemnifying party shall not relieve such indemnifying
party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall
not relieve it from any liability which it may have otherwise than
on account of this indemnity agreement. In the case of parties
indemnified pursuant to Sections 7(a)
and 7(b)
above, counsel to the indemnified
parties shall be selected by the Representatives, and, in the case
of parties indemnified pursuant to Section 7(c)
above, counsel to the indemnified
parties shall be selected by the Company or the Selling
Stockholders, as applicable. An indemnifying party may participate
at its own expense in the defense of any such action;
provided, however, that counsel to the indemnifying party shall not
(except with the consent of the indemnified party) also be counsel
to the indemnified party. In no event shall the indemnifying
parties be liable for fees and expenses of more than one counsel
(in addition to any relevant local counsel) separate from their own
counsel for all indemnified parties in connection with any one
action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or
circumstances. No indemnifying party shall, without the prior
written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought
under this Section 7
or Section 8
hereof (whether or not the indemnified
parties are actual or potential parties thereto), unless such
settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding 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.
(f) Settlement without Consent if
Failure to Reimburse. If at any
time an indemnified party shall have requested an indemnifying
party to reimburse the indemnified party for fees and expenses of
counsel in accordance with Section 7(a)
above, such indemnifying party agrees
that it shall be liable for any settlement of the nature
contemplated by Section
7(a)(ii) hereof effected
without its written consent if (i) such settlement is entered into
more than 60 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received
notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying
party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such
settlement.
SECTION 8. Contribution.
If the indemnification provided for in Section 7
hereof is for any reason unavailable
to or insufficient to hold harmless an indemnified party in respect
of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the
aggregate amount of such losses, liabilities, claims, damages and
expenses incurred by such indemnified party, as incurred,
(i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and Selling Stockholders,
on the one hand, and the Underwriters, on the other hand, from the
offering of the Securities pursuant to this Agreement or
(ii) if the allocation provided by clause
(i) above is not permitted
by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause
(i) above but also the
relative fault of the Company and the Selling Stockholders, on the
one hand, and of the Underwriters, on the other hand, in connection
with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other
relevant equitable considerations.
25
The
relative benefits received by the Company and the Selling
Stockholders, on the one hand, and the Underwriters, on the other
hand, in connection with the offering of the Securities pursuant to
this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the
Securities pursuant to this Agreement (before deducting expenses)
received by the Company and the Selling Stockholders, on the one
hand, and the total underwriting discount received by the
Underwriters, on the other hand, in each case as set forth on the
cover of the Prospectus, bear to the aggregate public offering
price of the Securities as set forth on the cover of the
Prospectus.
The
relative fault of the Company and the Selling Stockholders, on the
one hand, and the Underwriters, on the other hand, shall be
determined by reference to, among other things, whether any such
untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact relates to information
supplied by the Company and the Selling Stockholders or by the
Underwriters and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such
statement or omission.
The
Company, the Selling Stockholders and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this
Section 8 were
determined by pro rata
allocation (even if the Underwriters and Selling Stockholders were
each 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. The aggregate
amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this
Section 8
shall be deemed to include any documented out-of-pocket legal or
other expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any litigation, or
any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any
such untrue or alleged untrue statement or omission or alleged
omission.
Notwithstanding the
provisions of this Section 8, no Underwriter
shall be required to contribute any amount in excess of the
underwriting commissions received by such Underwriter in connection
with the Securities underwritten by it and distributed to the
public.
Notwithstanding the
provisions of this Section 8, no Selling Stockholder shall be
required to contribute (i) any amount in excess of the aggregate
gross proceeds after underwriting commissions and discounts, but
before expenses, to such Selling Stockholder from the sale of
Securities sold by such Selling Stockholder hereunder or (ii) with
respect to any losses, liabilities, claims, damages or expenses for
which such Selling Stockholder would not have been liable under
Section 7(b) hereof if such Section 7(b) were applied in accordance
with its terms.
No
person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
For
purposes of this Section 8, (i) each
person, if any, who controls an Underwriter within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act
and each Underwriter’s Affiliates and selling agents shall
have the same rights to contribution as such Underwriter, (ii) each
director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to
contribution as the Company and (iii) to the extent a Selling
Stockholder is an entity, each director, officer and each person,
if any, who controls a Selling Stockholder within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have
the same rights to contribution as such Selling Stockholder. The
Underwriters’ respective obligations to contribute pursuant
to this Section 8 are several in
proportion to the number of Securities set forth opposite their
respective names in Schedule A hereto and not
joint. The Selling Stockholders’ respective obligations to
contribute pursuant to this Section 8 are several in
proportion to the number of Securities set forth opposite their
respective names in Schedule B hereto and not
joint.
26
SECTION 9. Representations,
Warranties and Agreements to Survive. All representations, warranties and agreements
contained in this Agreement or in certificates of officers of the
Company of the Selling Stockholders submitted pursuant hereto,
shall remain operative and in full force and effect regardless of
(i) any investigation made by or on behalf of any Underwriter or
its Affiliates or selling agents, any person controlling any
Underwriter, its officers and directors, any person controlling the
Company, or by or on behalf of any Selling Stockholder and (ii)
delivery of and payment for the Securities.
SECTION 10. Termination of
Agreement.
(a) Termination. The Representatives may terminate this
Agreement, by notice to the Company and the Selling Stockholders,
at any time at or prior to the Closing Time (i) if there has
been, in the judgment of the Representatives, since the time of
execution of this Agreement or since the respective dates as of
which information is given in the Registration Statement, the
General Disclosure Package or the Prospectus, a Material Adverse
Effect, or (ii) if there has occurred any material adverse
change in the financial markets in the United States or the
international financial markets, any outbreak of hostilities or
escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or
international political, financial or economic conditions, in each
case the effect of which is such as to make it, in the judgment of
the Representatives, impracticable or inadvisable to proceed with
the completion of the offering or to enforce contracts for the sale
of the Securities, or (iii) if trading in any securities of
the Company has been suspended or materially limited by the
Commission or the NASDAQ Stock Market LLC, or (iv) if trading
generally on the New York Stock Exchange or on the NASDAQ Stock
Market LLC has been suspended or materially limited, or minimum or
maximum prices for trading have been fixed, or maximum ranges for
prices have been required, by any of said exchanges or by order of
the Commission, FINRA or any other governmental authority, or (v) a
material disruption has occurred in commercial banking or
securities settlement or clearance services in the United States or
with respect to Clearstream or Euroclear systems in Europe, or
(vi) if a banking moratorium has been declared by either
federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to
this Section 10,
such termination shall be without liability of any party to any
other party except as provided in Section 5
hereof, and provided further
that Sections
1, 7, 8, 9, 10(b),
13, 17 and 18 shall survive such termination and remain in full
force and effect.
SECTION 11. Reimbursement of
Underwriters’ Expenses. Notwithstanding anything to the contrary in this
Agreement, if (a) this Agreement shall have been terminated
pursuant to Section 10, (b) any Selling Stockholder shall fail to
tender the Securities for delivery to the Underwriters for any
reason not permitted under this Agreement or (c) the sale of the
Securities is not consummated because any condition to the
obligations of the Underwriters set forth herein is not satisfied
or because of the refusal, inability or failure on the part of the
Company or any Selling Stockholder to perform any agreement herein
or to satisfy any condition or to comply with the provisions
hereof, then in addition to the payment of amounts in accordance
with Section Error! Reference source not
found., each Selling
Stockholder shall reimburse the Underwriters for the fees and
expenses of Underwriters’ counsel and for such other
reasonable and documented out-of-pocket expenses as shall have been
incurred by them in connection with this Agreement and the proposed
purchase of the Securities, including, without limitation, travel
and lodging expenses of the Underwriters, and upon demand the
Selling Stockholders shall pay the full amount thereof to the
Underwriters.
27
(c)
SECTION 12. Default by One or More
of the Underwriters. If one or
more of the Underwriters shall fail at the Closing Time to purchase
the Securities which it or they are obligated to purchase under
this Agreement (the “Defaulted
Securities”), the
Representatives shall have the right, within 24 hours
thereafter, make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters reasonably satisfactory to
the Company and Selling Stockholders, to purchase all, but not less
than all, of the Defaulted Securities in such amounts as may be
agreed upon and upon the terms herein set forth; if, however, the
Representatives shall not have completed such arrangements within
such 24-hour period, then:
(i)
if the number of Defaulted Securities does not exceed 10% of the
number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be obligated, severally and not
jointly, to purchase the full amount thereof in the proportions
that their respective underwriting obligations hereunder bear to
the underwriting obligations of all non-defaulting Underwriters,
or
(ii) if the number of Defaulted Securities equals
or exceeds 10% of the number of Securities to be purchased on such
date, this Agreement, the obligation of the Underwriters to
purchase, and the Selling Stockholders to sell, the Securities to
be purchased and sold on the Closing Date shall terminate without
liability on the part of any non-defaulting Underwriter. Any
termination of this Agreement pursuant to this Section 12 shall be
without liability on the part of the Company or the Selling
Stockholders, except that the Selling Stockholders will continue to
be liable for the payment of expenses as set forth in
Section
5 hereof and provided further
that Sections
1, 7, 8, 9, 10(b),
13, 17 and 18 shall survive such termination and remain in full
force and effect.
No
action taken pursuant to this Section 12 shall relieve
any defaulting Underwriter from liability in respect of its
default.
In the
event of any such default which does not result in a termination of
this Agreement, either (i) the Representatives or
(ii) the Selling Stockholders shall have the right to postpone
the Closing Time for a period not exceeding seven days in order to
effect any required changes in the Registration Statement, the
General Disclosure Package or the Prospectus or in any other
documents or arrangements.
SECTION 13. Default by the Selling
Stockholders. If the Selling
Stockholders shall fail at the Closing Time to sell the number of
Securities that it is obligated to sell hereunder, then this
Agreement shall terminate without any liability on the part of any
nondefaulting party; provided, however, that the provisions
of Sections
1, 5, 7, 8, 9, 10(b),
13, 17 and 18 shall remain in full force and effect. No action
taken pursuant to this Section shall relieve the Selling
Stockholders from liability, if any, in respect of such
default.
SECTION 14. Notices.
All notices and other communications hereunder shall be in writing
and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to
the Underwriters shall be directed to the Representatives c/o
Canaccord Genuity LLC, ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇, Attention: General Counsel and c/o Roth
Capital Partners, LLC, ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇, Attention: Equity Capital Markets; notices to the Company
shall be directed to it at SharpSpring, Inc., ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Chief Financial
Officer; and notices to a Selling Stockholder shall be directed to
the address set forth on such Selling Stockholder’s signature
block.
28
In
accordance with the requirements of the USA Patriot Act (Title III
of Pub. L. 107-56 (signed into law October 26, 2001)), the
Underwriters are required to obtain, verify and record information
that identifies their respective clients, including the Company and
the Selling Stockholders, which information may include the name
and address of their respective clients, as well as other
information that will allow the Underwriters to properly identify
their respective clients.
SECTION 15. No Advisory or
Fiduciary Relationship. The
Company and each of the Selling Stockholders acknowledges and
agrees that (a) the purchase and sale of the Securities
pursuant to this Agreement, including the determination of the
public offering price of the Securities and any related discounts
and commissions, is an arm’s-length commercial transaction
between the Company and the Selling Stockholders, on the one hand,
and the several Underwriters, on the other hand, (b) in
connection with the offering of the Securities and the process
leading thereto, each Underwriter is and has been acting solely as
a principal and is not the agent or fiduciary of the Company or any
Selling Stockholder, or any of their respective stockholders,
creditors, employees or any other party, (c) no Underwriter
has assumed or will assume an advisory or fiduciary responsibility
in favor of the Company or any Selling Stockholder with respect to
the offering of the Securities or the process leading thereto
(irrespective of whether such Underwriter has advised or is
currently advising the Company or any Selling Stockholder on other
matters) and no Underwriter has any obligation to the Company or
any Selling Stockholder with respect to the offering of the
Securities except the obligations expressly set forth in this
Agreement, (d) the Underwriters and their respective
affiliates may be engaged in a broad range of transactions that
involve interests that differ from those of the Company or any
Selling Stockholder, and (e) the Underwriters have not
provided any legal, accounting, regulatory or tax advice with
respect to the offering of the Securities and the Company and each
of the Selling Stockholders has consulted its own respective legal,
accounting, regulatory and tax advisors to the extent it deemed
appropriate.
SECTION 16. Parties.
This Agreement shall each inure to the benefit of and be binding
upon the Underwriters, the Company and the Selling Stockholders and
their respective successors. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person,
firm or corporation, other than the Underwriters, the Company and
the Selling Stockholders and their respective successors and the
controlling persons and officers and directors referred to
in Sections 7
and 8 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision herein contained. This Agreement
and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the Underwriters, the Company and the
Selling Stockholders and their respective successors, and said
controlling persons and officers and directors and their heirs and
legal representatives, and for the benefit of no other person, firm
or corporation. No purchaser of Securities from any Underwriter
shall be deemed to be a successor by reason merely of such
purchase. In all dealings hereunder, the Representatives, acting
jointly, 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 the Representatives, acting
jointly.
SECTION 17. Trial by
Jury. The Company (on its
behalf and, to the extent permitted by applicable law, on behalf of
its stockholders and affiliates), each of the Selling Stockholders
and each of the Underwriters hereby irrevocably waives, to the
fullest extent permitted by applicable law, any and all right to
trial by jury in any legal proceeding arising out of or relating to
this Agreement or the transactions contemplated
hereby.
SECTION 18. GOVERNING
LAW. THIS AGREEMENT AND ANY
CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF, THE STATE OF NEW YORK WITHOUT REGARD TO ITS CHOICE OF
LAW PROVISIONS.
29
SECTION 19. TIME.
TIME SHALL BE OF THE ESSENCE OF THIS AGREEMENT. EXCEPT AS OTHERWISE
SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY
TIME.
SECTION 20. Partial
Unenforceability. The
invalidity or unenforceability of any Section, paragraph or
provision of this Agreement shall not affect the validity or
enforceability of any other Section, paragraph or provision hereof.
If any Section, paragraph or provision of this Agreement is for any
reason determined to be invalid or unenforceable, there shall be
deemed to be made such minor changes (and only such minor changes)
as are necessary to make it valid and
enforceable.
SECTION 21. Counterparts.
This Agreement may be executed 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
Agreement.
SECTION 22. Effect of
Headings. The Section headings
herein are for convenience only and shall not affect the
construction hereof.
SECTION 23. Entire
Agreement. This Agreement
supersedes all prior agreements and understandings (whether written
or oral) among the Company, the Selling Stockholders and the
Underwriters with respect to the subject matter
hereof.
[Remainder
of the page intentionally left blank; signature page
follows]
30
If the
foregoing correctly sets forth the understanding among the
Underwriters, the Selling Stockholders and the Company, please sign
and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding
agreement among the Underwriters, the Selling Stockholders and the
Company in accordance with its terms.
Very
truly yours,
By:
/s/ ▇▇▇▇▇▇▇
Stanczak_________________
Name:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title:
CFO
SHSP
HOLDINGS, LLC
By:
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇
__________________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Manager
EVERCEL HOLDINGS,
LLC
By:
/s/ ▇▇▇▇▇▇
Allen______________________
Name:
▇▇▇▇▇▇ ▇▇▇▇▇
Title:
Manager
If the
foregoing correctly sets forth the understanding among the
Underwriters, the Selling Stockholders and the Company, please sign
and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding
agreement among the Underwriters, the Selling Stockholders and the
Company in accordance with its terms.
Very
truly yours,
NORTH
PEAK CAPITAL PARTNERS, L.P..
By:
/s/ ▇▇▇▇▇▇
▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title: Managing Member of North Peak Capital Partners GP,
LLC
NORTH
PEAK CAPITAL PARTNERS II, L.P..
By:
/s/ ▇▇▇▇▇▇
▇▇▇▇▇
Name:
▇▇▇▇▇▇ ▇▇▇▇▇
Title: Managing Member of North Peak Capital Partners GP,
LLC
▇▇▇▇▇▇
▇. ▇▇▇▇▇
By:
/s/ ▇▇▇▇▇▇
▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
If the
foregoing correctly sets forth the understanding among the
Underwriters, the Selling Stockholders and the Company, please sign
and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding
agreement among the Underwriters, the Selling Stockholders and the
Company in accordance with its terms.
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CONFIRMED
AND ACCEPTED,
as
of the date first above written:
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||
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CANACCORD GENUITY
LLC
|
|||||
|
By:
|
/s/ ▇▇▇▇▇▇▇▇
▇▇▇▇▇
|
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||
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Name: ▇▇▇▇▇▇▇▇
▇▇▇▇▇
Title: Sr. Managing
Director
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▇▇▇▇
CAPITAL PARTNERS, LLC
|
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By:
|
/s/ ▇▇▇▇▇
▇▇▇▇▇▇▇▇
|
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||
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Name: ▇▇▇▇▇
▇▇▇▇▇▇▇▇
Title: Head of
Equity Capital Markets
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For
themselves and as Representatives of the other Underwriters named
in Schedule A
hereto.
Schedule A
|
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Name of
Underwriter
|
|
|
|
Number
ofSecurities
|
|
Canaccord
Genuity LLC
|
|
|
|
1,053,161
|
|
▇▇▇▇
Capital Partners, LLC
|
|
|
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1,001,787
|
|
|
|
|
|
|
|
Total
|
|
|
|
2,054,948
|
Price
per share: $12.2525
Schedule B
|
Name of Selling
Stockholder
|
|
|
|
Number of Shares
of
Securities to be
Sold
|
|
SHSP
Holdings, LLC
|
|
|
|
1,241,635
|
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Evercel
Holdings, LLC
|
|
|
|
519,304
|
|
North
Peak Capital Partners, L.P.
|
|
|
|
114,641
|
|
North
Peak Capital Partners II, L.P.
|
|
|
|
176,853
|
|
▇▇▇▇▇▇
▇. ▇▇▇▇▇
|
|
|
|
2,515
|
|
Total
|
|
|
|
2,054,948
|
Price
per share: $12.2525
Schedule C-1
PRICING TERMS
Securities:
2,054,948
Price
to Public: $13.00
Underwriters’
Discount: 5.75%
Schedule C-2
FREE WRITING PROSPECTUSES
None.
Schedule D
LIST OF PERSONS AND ENTITIES SUBJECT TO LOCK-UP
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
▇. ▇▇▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇▇▇
▇. ▇▇▇▇▇▇
▇▇▇▇▇▇
▇. ▇▇▇▇▇
Evercel,
Inc.
Schedule E
SUBSIDIARIES
SharpSpring
Technologies, Inc., a Delaware corporation
InterInbox
Sa, a Swiss corporation
InterCloud
Limited, a Gibraltar limited company
ERNEPH
2012A (Pty) Ltd. dba ISMS, a South African limited
company
ERNEPH
2012B (Pty) Ltd. dba GraphicMail South Africa, a South African
limited company
Exhibit A
FORM OF LOCK-UP AGREEMENT
_______________,
2019
Canaccord
Genuity LLC
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Capital Partners, LLC
as
Representatives of the several Underwriters
c/o
Canaccord Genuity LLC
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c/o
Roth Capital Partners, LLC
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Ladies
and Gentlemen:
This
agreement is being delivered to you in connection with the proposed
underwriting agreement (the “Underwriting Agreement”),
between SharpSpring, Inc., a Delaware corporation (the
“Company”), the selling stockholders party thereto, and
you, as representatives (the “Representatives”) of the
several underwriters named therein (the
“Underwriters”), relating to an underwritten public
offering (the “Offering”) of common stock, par value
$0.001 per share, of the Company (the “Common
Stock”).
In
order to induce the Underwriters to enter into the Underwriting
Agreement, the undersigned will not, without the prior written
consent of the Representatives, offer, sell, contract to sell,
pledge or otherwise transfer or dispose of (or enter into any
transaction which is designed to, or might reasonably be expected
to, result in the disposition of (whether by actual disposition or
effective economic disposition due to cash settlement or otherwise)
by the undersigned or any affiliate of the undersigned or any
person in privity with the undersigned or any affiliate of the
undersigned), directly or indirectly, including the filing (or
participation in the filing) of a registration statement with the
Securities and Exchange Commission in respect of, or establish or
increase a put equivalent position or liquidate or decrease a call
equivalent position within the meaning of Section 16 of the
Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Securities and Exchange Commission promulgated
thereunder (the “Exchange Act”) with respect to, any
shares of Common Stock or any securities convertible into, or
exercisable or exchangeable for Common Stock, or publicly announce
an intention to effect any such transaction, for a period from the
date hereof until, and including the date that is, 60 days after
the date of the Underwriting Agreement (the “Lock-Up
Period”). The restrictions described in the foregoing
sentence shall not apply to:
a. the
sale of Common Stock pursuant to the Underwriting
Agreement;
b. the
transfer of shares of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock (i) to the
spouse, domestic partner, parent, sibling, child or grandchild of
the undersigned or any other person with whom the undersigned has a
relationship by blood, marriage or adoption not more remote than
first cousin (each, an “immediate family member”) or to
a trust, or other entity formed for estate planning purposes,
formed for the direct or indirect benefit of the undersigned or of
an immediate family member of the undersigned; (ii) by bona fide
gift, will or intestacy; (iii) if the undersigned is a corporation,
partnership, limited liability company or other business entity (A)
to another corporation, partnership, limited liability company or
other business entity that controls, is controlled by or is under
common control with the undersigned or (B) as part of a
disposition, transfer or distribution by the undersigned to its
members, limited partners or equity holders; or (iv) if the
undersigned is a trust, to a trustor or beneficiary of the trust;
provided that in the case of any transfer or distribution pursuant
to this clause (a), (1) each transferee, trustee, donee or
distributee shall sign and deliver a lock-up agreement
substantially in the form of this agreement for the balance of the
Lock-Up Period, and (2) no filing under the Exchange Act shall be
required or shall be voluntarily made during the Lock-Up
Period;
c. the
receipt by the undersigned from the Company of shares of Common
Stock (the “Plan Shares”) upon the vesting of
restricted stock awards or exercise of options to purchase the
Company’s securities issued pursuant to the Company’s
equity incentive plans or the transfer of shares of Common Stock or
any securities convertible into Common Stock to the Company upon a
vesting event of the Company’s securities or upon the
exercise of options or warrants to purchase the Company’s
securities, in each case on a “cashless” or “net
exercise” basis or to cover tax obligations of the
undersigned in connection with such vesting or exercise, provided
that any filing under the Exchange Act shall clearly indicate in
the footnotes thereto that the filing relates to such exercise,
vesting, or sale or transfer to cover tax withholding obligations
and provided further, that the Plan Shares shall be subject to the
terms of this agreement;
d. the
transfer of shares of Common Stock or any security convertible into
or exercisable or exchangeable for Common Stock to the Company,
pursuant to agreements under which the Company may (either with or
without the prior consent of the undersigned) repurchase, repay or
otherwise redeem such shares or securities or exercise a right of
first refusal with respect to transfers of such shares or
securities;
e. the
establishment of a trading plan pursuant to Rule 10b5-1 under the
Exchange Act for the transfer of shares of Common Stock, provided
that (i) such plan does not provide for the transfer of Common
Stock during the Lock-Up Period and (ii) no public announcement or
filing under the Exchange Act is required of or voluntarily made by
or on behalf of the undersigned or the Company regarding the
establishment of such plan; or
f. the
transfer of shares of Common Stock or any security convertible into
or exercisable or exchangeable for Common Stock that occurs by
operation of law including pursuant to a qualified domestic order
or in connection with a divorce settlement, provided that the
transferee signs and delivers a lock-up agreement substantially in
the form of this agreement for the balance of the Lock-Up
Period.
In
addition, the undersigned hereby waives any rights the undersigned
may have to require registration of Common Stock in connection with
the filing of a registration statement relating to the Offering.
The undersigned further agrees that, for the Lock-Up Period, the
undersigned will not, without the prior written consent of the
Representatives, make any demand for, or exercise any right with
respect to, the registration of Common Stock or any other
securities of the Company that are substantially similar to Common
Stock (including any securities that derive value therefrom), or
any securities convertible into or exercisable or exchangeable for
Common Stock, or warrants or other rights to purchase Common Stock
or any such other securities. In addition, the undersigned hereby
waives any and all preemptive rights, participation rights, resale
rights, rights of first refusal and similar rights that the
undersigned may have in connection with the Offering or with any
issuance or sale by the Company of any equity or other securities
before the Offering.
In
furtherance of the foregoing, the Company, and any duly appointed
transfer agent for the registration or transfer of the securities
described herein, are hereby authorized to decline to make any
transfer of securities if such transfer would constitute a
violation or breach of this agreement.
The
undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this agreement. All
authority herein conferred or agreed to be conferred shall survive
the death or incapacity of the undersigned and any obligations of
the undersigned shall be binding upon the successors, assigns,
heirs or personal representatives of the undersigned.
If for
any reason the Underwriting Agreement shall be terminated prior to
the Closing Date (as defined in the Underwriting Agreement), the
agreement set forth above shall likewise be
terminated.
Yours
very truly,
Name:____________________________________
By:
____________________________________