EXHIBIT 1.1
1,850,000 Shares*
MEASUREMENT SPECIALTIES, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
________ __, 2001
▇▇▇▇▇▇▇ & COMPANY, INC.
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & CO., INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC
As Representatives of the several Underwriters
c/o Needham & Company, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Measurement Specialties, Inc., a New Jersey corporation (the
"Company"), proposes to issue and sell 1,750,000 shares (the "Company Firm
Shares") of the Company's Common Stock, no par value (the "Common Stock"), and
the stockholders of the Company named in Schedule II hereto (collectively, the
"Selling Stockholders") propose to sell an aggregate of 100,000 shares (the
"Selling Stockholder Firm Shares") of Common Stock, in each case to you and to
the several other Underwriters named in Schedule I hereto (collectively, the
"Underwriters"), for whom you are acting as representatives (the
"Representatives"). The Company has also agreed to grant to you and the other
Underwriters an option (the "Option") to purchase up to an additional 277,500
shares of Common Stock, on the terms and for the purposes set forth in Section
1(b) (the "Option Shares"). The Company Firm Shares and the Selling Stockholder
Firm Shares are sometimes referred to collectively herein as the "Firm Shares".
The Firm Shares and the Option Shares are referred to collectively herein as the
"Shares."
The Company and each of the Selling Stockholders confirm as follows
their respective agreements with the Representatives and the several other
Underwriters:
1. Agreement to Sell and Purchase.
(a) On the basis of the representations, warranties and
agreements of the Company and each of the Selling Stockholders herein contained
and subject to all the terms and conditions of this
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* Plus an option to purchase up to an additional 277,500 shares from the Company
to cover over-allotments.
Agreement, (i) the Company agrees to issue and sell the Company Firm Shares to
the several Underwriters, (ii) each Selling Stockholder, severally and not
jointly, agrees to sell to the several Underwriters the respective number of
Selling Stockholder Firm Shares set forth opposite that Selling Stockholder's
name on Schedule II hereto, and (iii) each of the Underwriters, severally and
not jointly, agrees to purchase from the Company and the Selling Stockholders
the respective number of Firm Shares set forth opposite that Underwriter's name
in Schedule I hereto, at the purchase price of $____ for each Firm Share. The
number of Firm Shares to be purchased by each Underwriter from the Company and
each Selling Stockholder shall be as nearly as practicable in the same
proportion to the total number of Firm Shares being sold by the Company and each
Selling Stockholder as the number of Firm Shares being purchased by each
Underwriter bears to the total number of Firm Shares to be sold hereunder.
(b) Subject to all the terms and conditions of this Agreement,
the Company grants the Option to the several Underwriters to purchase, severally
and not jointly, up to the maximum number of Option Shares set forth in the
first paragraph hereof, at the same price per share as the Underwriters shall
pay for the Firm Shares. The Option may be exercised only to cover
over-allotments in the sale of the Firm Shares by the Underwriters and may be
exercised in whole or in part at any time (but not more than once) on or before
the 30th day after the date of this Agreement upon written or telegraphic notice
(the "Option Shares Notice") by the Representatives to the Company no later than
12:00 noon, New York City time, at least two and no more than five business days
before the date specified for closing in the Option Shares Notice (the "Option
Closing Date"), setting forth the aggregate number of Option Shares to be
purchased and the time and date for such purchase. On the Option Closing Date,
the Company will issue and sell to the Underwriters the number of Option Shares
set forth in the Option Shares Notice, and each Underwriter will purchase such
percentage of the Option Shares as is equal to the percentage of Firm Shares
that such Underwriter is purchasing, as adjusted by the Representatives in such
manner as they deem advisable to avoid fractional shares.
2. Delivery and Payment. Delivery of the Firm Shares shall be made to the
Representatives for the accounts of the Underwriters against payment of the
purchase price by certified or official bank checks or by wire transfer payable
in same-day funds to the order of the Company for the Company Firm Shares to be
sold by it, and by wire transfer payable in same-day funds to the order of the
Company as custodian for the Selling Stockholders (the "Custodian"), for the
Selling Stockholder Firm Shares to be sold by the Selling Stockholders, at the
office of ▇▇▇▇▇▇▇ & Company, Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, at
10:00 a.m., New York City time, on the third (or, if the purchase price set
forth in Section 1(b) hereof is determined after 4:30 p.m., New York City time,
the fourth) business day following the commencement of the offering contemplated
by this Agreement, or at such time on such other date, not later than seven
business days after the date of this Agreement, as may be agreed upon by the
Company and the Representatives (such date is hereinafter referred to as the
"Closing Date").
To the extent the Option is exercised, delivery of the Option Shares
against payment by the Underwriters (in the manner specified above) will take
place at the offices specified above for the Closing Date at the time and date
(which may be the Closing Date) specified in the Option Shares Notice.
Certificates evidencing the Shares shall be in definitive form and
shall be registered in such names and in such denominations as the
Representatives shall request at least two business days prior to the Closing
Date or the Option Closing Date, as the case may be, by written notice to the
Company. For the purpose of expediting the checking and packaging of
certificates for the Shares, the Company agrees to make such certificates
available for inspection at least 24 hours prior to the Closing Date or the
Option Closing Date, as the case may be.
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The cost of original issue tax stamps, if any, in connection with the
issuance and delivery of the Firm Shares and Option Shares by the Company to the
respective Underwriters shall be borne by the Company. The Company will pay and
save each Underwriter and any subsequent holder of the Shares harmless from any
and all liabilities with respect to or resulting from any failure or delay in
paying Federal and state stamp and other transfer taxes, if any, which may be
payable or determined to be payable in connection with the original issuance or
sale to such Underwriter of the Shares.
3. Representations and Warranties of the Company. The Company represents,
warrants and covenants to each Underwriter that:
(a) A registration statement (Registration No. 333-______) on
Form S-1 relating to the Shares, including a Preliminary Prospectus and such
amendments to such registration statement as may have been required to the date
of this Agreement, has been prepared by the Company under the provisions of the
Securities Act of 1933, as amended (the "Act"), and the rules and regulations
(collectively referred to as the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") promulgated thereunder, and has been
filed with the Commission. The term "Preliminary Prospectus" as used herein
means a preliminary prospectus as contemplated by Rule 430 or Rule 430A of the
Rules and Regulations included at any time as part of the registration
statement. Copies of such registration statement and amendments and of each
related Preliminary Prospectus have been delivered to the Representatives. If
such registration statement has not become effective, a further amendment to
such registration statement, including a form of final prospectus, necessary to
permit such registration statement to become effective will be filed promptly by
the Company with the Commission. If such registration statement has become
effective, a final prospectus containing information permitted to be omitted at
the time of effectiveness by Rule 430A of the Rules and Regulations will be
filed promptly by the Company with the Commission in accordance with Rule 424(b)
of the Rules and Regulations. The term "Registration Statement" means the
registration statement as amended at the time it becomes or became effective
(the "Effective Date"), including financial statements and all exhibits and any
information deemed to be included by Rule 430A and includes any registration
statement relating to the offering contemplated by this Agreement and filed
pursuant to Rule 462(b) of the Rules and Regulations. The term "Prospectus"
means the prospectus as first filed with the Commission pursuant to Rule 424(b)
of the Rules and Regulations or, if no such filing is required, the form of
final prospectus included in the Registration Statement at the Effective Date.
(b) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and no stop order suspending the
effectiveness of the Registration Statement (including any related registration
statement filed pursuant to Rule 462(b) under the Act) or any post-effective
amendment thereto has been issued, and no proceeding for that purpose has been
initiated or threatened by the Commission. On the Effective Date, the date the
Prospectus is first filed with the Commission pursuant to Rule 424(b) (if
required), at all times subsequent to and including the Closing Date and, if
later, the Option Closing Date and when any post-effective amendment to the
Registration Statement becomes effective or any amendment or supplement to the
Prospectus is filed with the Commission, the Registration Statement and the
Prospectus (as amended or as supplemented if the Company shall have filed with
the Commission any amendment or supplement thereto), including the financial
statements included in the Prospectus, did and will comply with all applicable
provisions of the Act and the Rules and Regulations and will contain all
statements required to be stated therein in accordance with the Act and the
Rules and Regulations. On the Effective Date and when any post-effective
amendment to the Registration Statement becomes effective, no part of the
Registration Statement, the Prospectus or any such amendment or supplement
thereto did or will contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein not misleading. At the Effective Date, the date the
Prospectus or any amendment or supplement to the Prospectus is filed with the
Commission and at the Closing Date
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and, if later, the Option Closing Date, the Prospectus did not and will not
contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The foregoing representations and
warranties in this Section 3(b) do not apply to any statements or omissions made
in reliance on and in conformity with information relating to any Underwriter
furnished in writing to the Company by the Representatives specifically for
inclusion in the Registration Statement or Prospectus or any amendment or
supplement thereto. The Company acknowledges that the statements set forth under
the heading "Underwriting" in the Prospectus constitute the only information
relating to any Underwriter furnished in writing to the Company by the
Representatives specifically for inclusion in the Registration Statement.
(c) the subsidiaries listed in Exhibit 21 to the Registration
Statement (the "Subsidiaries"), the Company does not own, and at the Closing
Date and, if later, the Option Closing Date, will not own, directly or
indirectly, any shares of stock or any other equity or long-term debt securities
of any corporation or have any equity interest in any corporation, firm,
partnership, joint venture, association or other entity. The Company and each of
its Subsidiaries is, and at the Closing Date and, if later, the Option Closing
Date, will be, a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation. The Company and
each of its Subsidiaries has, and at the Closing Date and, if later, the Option
Closing Date, will have, full power and authority to conduct its business as
contemplated by the Prospectus, to own or lease all the assets owned or leased
by it and to conduct its business as described in the Registration Statement and
the Prospectus. The Company and each of its Subsidiaries is, and at the Closing
Date and, if later, the Option Closing Date, will be, duly licensed or qualified
to do business and in good standing as a foreign corporation in all
jurisdictions in which the nature of the activities conducted by it or the
character of the assets owned or leased by it makes such license or
qualification necessary, except to the extent that the failure to be so
qualified or be in good standing would not result in any effect, event or
condition, individually or in the aggregate, which would reasonably be expected
to be materially adverse to the Company, any Subsidiary or the business,
properties, business prospects, condition (financial or other) or results of
operations of the Company or any Subsidiary (a "Material Adverse Effect"). All
of the outstanding shares of capital stock of each Subsidiary have been duly
authorized and validly issued and are fully paid and nonassessable, and owned by
the Company or another Subsidiary free and clear of all claims, liens, charges
and encumbrances; there are no securities outstanding that are convertible into
or exercisable or exchangeable for capital stock of any Subsidiary. Other than
as set forth in Schedule III hereto, The Company is not, and at the Closing Date
and, if later, the Option Closing Date, will not be, engaged in any discussions
or a party to any agreement or understanding, written or oral, regarding the
acquisition of an interest in any corporation, firm, partnership, joint venture,
association or other entity where such discussions, agreements or understandings
would require amendment to the Registration Statement pursuant to applicable
securities laws. Complete and correct copies of the charter and of the by-laws
of the Company and each of its Subsidiaries and all amendments thereto have been
delivered to the Representatives, and no changes therein will be made subsequent
to the date hereof and prior to the Closing Date or, if later, the Option
Closing Date.
(d) All of the outstanding shares of capital stock of the Company
(including the Selling Stockholder Firm Shares to be sold by the Selling
Stockholders under this Agreement) have been duly authorized, validly issued and
are fully paid and nonassessable and were issued in compliance with all
applicable state and federal securities laws; the Firm Shares, and the Option
Shares issued by the Company (if any), have been duly authorized and when issued
and paid for as contemplated herein will be validly issued, fully paid and
nonassessable; no preemptive or similar rights exist with respect to any of the
Shares or the issue and sale thereof. The Underwriters will receive good and
valid title to the Shares purchased from the Company, free and clear of all
liens, claims, security interests, pledges, charges, encumbrances, preemptive
rights, stockholders' agreements and voting trusts and other defects
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in title. The description of the capital stock of the Company in the
Registration Statement and the Prospectus is, and at the Closing Date and, if
later, the Option Closing Date, will be, complete and accurate in all respects.
Except as set forth in the Prospectus, the Company does not have outstanding,
and at the Closing Date and, if later, the Option Closing Date, will not have
outstanding, any options to purchase, or any rights or warrants to subscribe
for, or any securities or obligations convertible into, or any contracts or
commitments to issue or sell, any shares of capital stock, or any such warrants,
convertible securities or obligations. No further approval or authority of
stockholders or the Board of Directors of the Company will be required for the
transfer and sale of the Selling Stockholder Firm Shares or the issuance and
sale of the Company Firm Shares and the Option Shares as contemplated herein.
(e) The financial statements and schedules included in the
Registration Statement or the Prospectus present fairly the consolidated
financial condition of the Company as of the respective dates thereof and the
results of operations and cash flows of the Company and its Subsidiaries for the
respective periods covered thereby, all in conformity with generally accepted
accounting principles applied on a consistent basis throughout the entire period
involved, except as otherwise disclosed in the Prospectus. No other financial
statements or schedules of the Company are required by the Act or the Rules and
Regulations to be included in the Registration Statement or the Prospectus.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, LLP (together, the "Accountants"), who have
reported on such financial statements and schedules, are independent accountants
with respect to the Company as required by the Act and the Rules and
Regulations. The summary consolidated financial and statistical data included in
the Registration Statement present fairly the information shown therein and have
been compiled on a basis consistent with the financial statements presented
therein.
(f) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus and prior to the Closing
Date and, if later, the Option Closing Date, except as set forth in or
contemplated by the Registration Statement and the Prospectus, (i) there has not
been and will not have been any change in the capitalization of the Company
(other than in connection with the exercise of options to purchase the Company's
Common Stock granted pursuant to the Company's stock option plans from the
shares reserved therefor as described in the Registration Statement) or Material
Adverse Effect arising for any reason whatsoever, (ii) neither the Company nor
any of its Subsidiaries has incurred, nor will any of them incur, except in the
ordinary course of business as described in the Prospectus, any material
liabilities or obligations, direct or contingent, nor has the Company or any of
its Subsidiaries entered into nor will any of them enter into, except in the
ordinary course of business as described in the Prospectus, any material
transactions other than pursuant to this Agreement and the transactions referred
to herein and (iii) the Company has not and will not have paid or declared any
dividends or other distributions of any kind on any class of its capital stock.
(g) The Company is not, will not become as a result of the
transactions contemplated hereby, and does not intend to conduct its business in
a manner that would cause it to become, an "investment company" or an
"affiliated person" of, or "promoter" or "principal underwriter" for, an
"investment company," as such terms are defined in the Investment Company Act of
1940, as amended.
(h) Except as set forth in the Registration Statement and the
Prospectus, there are no actions, suits or proceedings pending or, to the best
knowledge of the Company, threatened against or affecting the Company, any
Subsidiary or any of their respective officers in their capacity as such, nor
any basis therefor, before or by any Federal or state court, commission,
regulatory body, administrative agency or other governmental body, domestic or
foreign, wherein an unfavorable ruling, decision or finding might result in a
Material Adverse Effect.
(i) The Company and each of its Subsidiaries has, and at the
Closing Date and, if later, the Option Closing Date, will have, performed all
the obligations required to be performed by it, and is not,
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and at the Closing Date, and, if later, the Option Closing Date, will not be in
default under any contract or other instrument to which it is a party or by
which its property is bound or affected, which default might result in a
Material Adverse Effect. To the best knowledge of the Company, no other party
under any contract or other instrument to which it is a party is in default in
any respect thereunder, which default might result in a Material Adverse Effect.
The Company and each of its Subsidiaries is not, and at the Closing Date and, if
later, the Option Closing Date, will not be, in violation of any provision of
its charter or by-laws or other organizational documents.
(j) No consent, approval, authorization or order of, or any
filing or declaration with, any court or governmental agency or body is required
for the consummation by the Company of the transactions on its part contemplated
herein, except such as have been obtained under the Act or the Rules and
Regulations and such as may be required under state securities or so-called blue
sky ("Blue Sky") laws or the by-laws and rules of the National Association of
Securities Dealers, Inc. (the "NASD") in connection with the purchase and
distribution by the Underwriters of the Shares.
(k) The Company has full corporate power and authority to enter
into this Agreement. This Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid and binding agreement of the
Company, enforceable against the Company accordance with the terms hereof. The
performance of this Agreement and the consummation of the transactions
contemplated hereby will not result in the creation or imposition of any lien,
charge or encumbrance upon any of the assets of the Company or any of its
Subsidiaries pursuant to the terms or provisions of, or result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
or give any party a right to terminate any of its obligations under, or result
in the acceleration of any obligation under, the charter or by-laws of the
Company or any of its Subsidiaries, any indenture, mortgage, deed of trust,
voting trust agreement, loan agreement, bond, debenture, note agreement or other
evidence of indebtedness, lease, contract or other agreement or instrument to
which the Company or any of its Subsidiaries is a party or by which the Company,
any of its Subsidiaries or any of their respective properties is bound or
affected, or violate or conflict with any judgment, ruling, decree, order,
statute, rule or regulation of any court or other governmental agency or body
applicable to the business or properties of the Company or any of its
Subsidiaries.
(l) The Company or a Subsidiary has good and marketable title to
all properties and assets described in the Prospectus as owned by them,
respectively, free and clear of all liens, charges, encumbrances or
restrictions, except such as are described in the Prospectus or are not material
to the business of the Company or its Subsidiaries. The Company or a Subsidiary
has valid, subsisting and enforceable leases for the properties described in the
Prospectus as leased by them. The Company and its Subsidiaries owns or leases
all such properties as are necessary to the operations of the Company or its
Subsidiaries as contemplated by the Prospectus, except where the failure to so
own or lease would not result in a Material Adverse Effect.
(m) There is no contract, agreement, instrument, lease, license,
certificate, permit or other arrangement, whether written or oral, of a
character required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement which is
not described or filed as required. All such contracts to which the Company or
any of its Subsidiaries is a party have been duly authorized, executed and
delivered by the Company or such Subsidiary, constitute valid and binding
agreements of the Company or such Subsidiary, as the case may be, and are
enforceable against and by the Company or such Subsidiary, as the case may be,
in accordance with the terms thereof.
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(n) No statement, representation, warranty or covenant made by
the Company in this Agreement or made in any certificate or document required by
Section 6 of this Agreement to be delivered to the Representatives was or will
be, when made, inaccurate, untrue or incorrect.
(o) Neither the Company nor any of its directors, officers or
controlling persons has taken, directly or indirectly, any action designed, or
which might reasonably be expected, to cause or result, under the Act or
otherwise, in, or which has constituted, stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of the
Shares.
(p) No holder of securities of the Company has rights to the
registration of any securities of the Company because of the filing of the
Registration Statement, which rights have not been waived by the holder thereof
as of the date hereof.
(q) The Company has filed a registration statement pursuant to
Section 12(g) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), to register the Common Stock, has filed an application to list the Shares
on the American Stock Exchange, and has received notification that the listing
has been approved, subject to notice of issuance of the Shares. The Shares to be
sold by the Selling Stockholders hereunder are listed on the American Stock
Exchange.
(r) The Company has not distributed and will not distribute any
prospectus or other offering material in connection with the offer and sale of
the Shares, other than the Preliminary Prospectus or the Prospectus or other
offering materials permitted by the Act and the Rules and Regulations to be
distributed.
(s) Except as disclosed in or specifically contemplated by the
Prospectus (i) each of the Company and its Subsidiaries (A) owns or has adequate
rights to use all trademarks, service marks, trade names, inventions, designs,
trade secrets, know-how, patent rights, copyrights and other intellectual
property (collectively, "Intellectual Property") and (B) has such other
licenses, approvals and governmental authorizations, in each case, sufficient to
conduct its business as now conducted and as now proposed to be conducted, (ii)
to the best knowledge of the Company, none of the patent rights owned or
licensed by the Company or its Subsidiaries is unenforceable or invalid; the
Company or such Subsidiary, as the case may be, has duly and properly filed or
caused to be filed with the United States Patent and Trademark Office (the
"PTO") and applicable foreign and international patent authorities all patent
applications described or referred to in the Registration Statement and
Prospectus and believes that the Company or such Subsidiary has complied with
the PTO's duty of candor and disclosure for such patent applications; the
Company is unaware of any facts which preclude the grant of a patent from its
pending patent applications; the Company has no knowledge of any facts which
would preclude the Company or such Subsidiary from having clear title to its
pending patent applications; and the Company is unaware of the granting of any
patent rights to third parties or the filing of any patent applications by third
parties or any other rights of third parties to any of the Company's
Intellectual Property, (iii) the Company has no knowledge of any infringement by
the Company or any Subsidiary of the Intellectual Property of others, where such
infringement might have a Material Adverse Effect, and (iv) there is no (A)
claim being made against the Company or its Subsidiaries, (B) to the best
knowledge of the Company, claim being made against any employee of the Company
or its Subsidiaries, or (C) to the best knowledge of the Company, basis
therefor, in each case, regarding the Intellectual Property of the Company, its
Subsidiaries or others which might have a Material Adverse Effect.
(t) The Company and each of its Subsidiaries has filed all
federal, state, local and foreign income tax returns which have been required to
be filed and has paid all taxes and assessments received by it to the extent
that such taxes or assessments have become due. The Company and each of its
Subsidiaries has no tax deficiency which has been or, to the best knowledge of
the Company, might be
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asserted or threatened against the Company or any Subsidiary which might have a
Material Adverse Effect.
(u) The pro forma financial information set forth in the
Registration Statement reflects, subject to the limitations set forth in the
Registration Statement as to such pro forma financial information, the results
of operations of the Company purported to be shown thereby for the periods
indicated and conforms to the requirements of Regulation S-X of the Rules and
Regulations and management of the Company believes (i) the assumptions
underlying the pro forma adjustments are reasonable, (ii) that such adjustments
have been properly applied to the historical amounts in the compilation of such
statements, and (iii) that such statements present fairly, with respect to the
Company and its Subsidiaries, the pro forma financial position and results of
operations and the other information purported to be shown therein at the
respective dates or for the respective periods therein specified.
(v) The Company or its Subsidiaries owns or possesses all
authorizations, approvals, orders, licenses, registrations, other certificates
and permits of and from all governmental regulatory officials and bodies,
necessary to conduct their respective businesses as contemplated in the
Prospectus, except where the failure to own or possess all such authorizations,
approvals, orders, licenses, registrations, other certificates and permits would
not result in a Material Adverse Effect. There is no proceeding pending or
threatened (or any basis therefor known to the Company) which may cause any such
authorization, approval, order, license, registration, certificate or permit to
be revoked, withdrawn, canceled, suspended or not renewed; and the Company and
each of its Subsidiaries is conducting its business in compliance with all laws,
rules and regulations applicable thereto (including, without limitation, all
applicable federal, state and local environmental laws and regulations) except
where such noncompliance would not result in a Material Adverse Effect.
(w) The Company and each of its Subsidiaries maintains insurance
of the types and in the amounts generally deemed adequate for its business,
including, but not limited to, insurance covering real and personal property
owned or leased by the Company or such Subsidiary against theft, damage,
destruction, acts of vandalism and all other risks customarily insured against,
all of which insurance is in full force and effect.
(x) Neither the Company has nor, to the best knowledge of the
Company, any of the Subsidiaries or any of their respective employees or agents
at any time during the last five years (i) made any unlawful contribution to any
candidate for foreign office, or failed to disclose fully any contribution in
violation of law, or (ii) made any payment to any federal or state governmental
officer or official, or other person charged with similar public or quasi-public
duties, other than payments required or permitted by the laws of the United
States or any jurisdiction thereof.
4. Representations, Warranties and Covenants of the Selling Stockholders.
Each Selling Stockholder, severally and not jointly, represents, warrants and
covenants to each Underwriter that:
(a) All consents, approvals, authorizations and orders necessary
for the execution and delivery by such Selling Stockholder of this Agreement and
the Power-of-Attorney and Custody Agreement (hereinafter referred to as a
"Stockholders' Agreement") relating hereto, and for the sale and delivery of the
Selling Stockholder Firm Shares to be sold by such Selling Stockholder
hereunder, have been obtained; and such Selling Stockholder has full right,
power and authority to enter into this Agreement and the Stockholders'
Agreement, to make the representations, warranties and agreements hereunder and
thereunder, and to sell, assign, transfer and deliver the Shares to be sold by
such Selling Stockholder hereunder.
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(b) Certificates in negotiable form representing all of the
Selling Stockholder Firm Shares to be sold by such Selling Stockholder have been
placed in custody under the Stockholders' Agreement, in the form heretofore
furnished to you, duly executed and delivered by such Selling Stockholder to the
Custodian, and such Selling Stockholder has duly executed and delivered a
power-of-attorney, in the form heretofore furnished to you and included in the
Stockholders' Agreement (the "Power-of-Attorney"), appointing [_______________]
and [_______________], and each of them, as such Selling Stockholder's
attorney-in-fact (the "Attorneys-in-Fact") with authority to execute and deliver
this Agreement on behalf of such Selling Stockholder, to determine (subject to
the provisions of the Stockholders' Agreement) the purchase price to be paid by
the Underwriters to the Selling Stockholders as provided in Section 1 hereof, to
authorize the delivery of the Selling Stockholder Firm Shares to be sold by such
Selling Stockholder hereunder and otherwise to act on behalf of such Selling
Stockholder in connection with the transactions contemplated by this Agreement
and the Stockholders' Agreement.
(c) Such Selling Stockholder specifically agrees that the Selling
Stockholder Firm Shares represented by the certificates held in custody for such
Selling Stockholder under the Stockholders' Agreement are for the benefit of and
coupled with and subject to the interests of the Underwriters, the Custodian,
the Attorneys-in-Fact, each other Selling Stockholder and the Company, that the
arrangements made by such Selling Stockholder for such custody, and the
appointment by such Selling Stockholder of the Attorneys-in-Fact by the
Power-of-Attorney, are to that extent irrevocable, and that the obligations of
such Selling Stockholder hereunder shall not be terminated by operation of law,
whether by the death, disability, incapacity, liquidation or dissolution of any
Selling Stockholder or by the occurrence of any other event. If any individual
Selling Stockholder or any executor or trustee for a Selling Stockholder should
die or become incapacitated, or if any Selling Stockholder that is an estate or
trust should be terminated, or if any Selling Stockholder that is a partnership
or corporation should be dissolved, or if any other such event should occur,
before the delivery of the Selling Stockholder Firm Shares hereunder,
certificates or warrant agreements representing the Selling Stockholder Firm
Shares shall be delivered by or on behalf of the Selling Stockholders in
accordance with the terms and conditions of this Agreement and of the
Stockholders' Agreement, and actions taken by the Attorneys-in-Fact pursuant to
the Powers-of-Attorney shall be as valid as if such death, incapacity,
termination, dissolution or other event had not occurred, regardless of whether
or not the Custodian, the Attorneys-in-Fact, or any of them, shall have received
notice of such death, incapacity, termination, dissolution or other event.
(d) This Agreement and the Stockholders' Agreement have each been
duly authorized, executed and delivered by such Selling Stockholder and each
such document constitutes a valid and binding obligation of such Selling
Stockholder, enforceable in accordance with its terms.
(e) No consent, approval, authorization or order of, or any
filing (other than a final amendment to Schedule 13D, a Form 4 or an IRS
Currency Transaction Report, as may be required) or declaration with, any court
or governmental agency or body is required in connection with the sale of the
Selling Stockholder Firm Shares by such Selling Stockholder or the consummation
by such Selling Stockholder of the transactions on its part contemplated by this
Agreement and the Stockholders' Agreement, except such as have been obtained
under the Act or the Rules and Regulations and such as may be required under
state securities or Blue Sky laws or the by-laws and rules of the NASD in
connection with the purchase and distribution by the Underwriters of the Shares
to be sold by such Selling Stockholder.
(f) The sale of the Selling Stockholder Firm Shares to be sold by
such Selling Stockholder hereunder and the performance by such Selling
Stockholder of this Agreement and the Stockholders' Agreement and the
consummation of the transactions contemplated hereby and thereby will not result
in the creation or imposition of any lien, charge or encumbrance upon any of the
assets of such Selling
9
Stockholder pursuant to the terms or provisions of, or result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
or give any party a right to terminate any of its obligations under, or result
in the acceleration of any obligation under, any indenture, mortgage, deed of
trust, voting trust agreement, loan agreement, bond, debenture, note agreement
or other evidence of indebtedness, lease, contract or other agreement or
instrument to which such Selling Stockholder is a party or by which such Selling
Stockholder or any of its properties is bound or affected, or violate or
conflict with any judgment, ruling, decree, order, statute, rule or regulation
of any court or other governmental agency or body applicable to such Selling
Stockholder or, if such Selling Stockholder is a corporation, partnership or
other entity, the organizational documents of such Selling Stockholder.
(g) Such Selling Stockholder has, and at the Closing Date will
have, good and marketable title to the Selling Stockholder Firm Shares to be
sold by such Selling Stockholder hereunder, free and clear of all liens,
encumbrances, equities or claims whatsoever; and, upon delivery of such Selling
Stockholder Firm Shares and payment therefor pursuant hereto, good and
marketable title to such Selling Stockholder Firm Shares free and clear of all
liens, encumbrances, equities or claims whatsoever, will be delivered to the
Underwriters.
(h) On the Closing Date, all stock transfer or other taxes (other
than income taxes) that are required to be paid in connection with the sale and
transfer of the Shares to be sold by such Selling Stockholder to the several
Underwriters hereunder will have been fully paid or provided for by such Selling
Stockholder and all laws imposing such taxes will have been fully complied with.
(i) Other than as permitted by the Act and the Rules and
Regulations, such Selling Stockholder has not distributed and will not
distribute any Preliminary Prospectus, the Prospectus or any other offering
material in connection with the offering and sale of the Shares. Such Selling
Stockholder has not taken and will not at any time take, directly or indirectly,
any action designed, or which might reasonably be expected, to cause or result
in, or which will constitute, stabilization of the price of shares of Common
Stock to facilitate the sale or resale of any of the Shares.
(j) All information provided by such Selling Stockholder
contained in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto complied or will comply in all
material respects with all applicable requirements of the Act and the Rules and
Regulations and does 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.
(k) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal Responsibility
Act of 1982 with respect to the transactions herein contemplated, such Selling
Stockholder agrees to deliver to you prior to or at the Closing Date or the
Option Closing Date, as applicable, a properly completed and executed United
States Treasury Department Form W-9 (or other applicable form or statement
specified by Treasury Department regulations in lieu thereof).
5. Agreements of the Company and the Selling Stockholders. Each of the
Company and the Selling Stockholders covenants and agrees with the several
Underwriters as follows:
(a) The Company will not, either prior to the Effective Date or
thereafter during such period as the Prospectus is required by law to be
delivered in connection with sales of the Shares by an Underwriter or dealer,
file any amendment or supplement to the Registration Statement or the
Prospectus, unless a copy thereof shall first have been submitted to the
Representatives within a
10
reasonable period of time prior to the filing thereof and the Representatives
shall not have objected thereto in good faith.
(b) The Company will use its best efforts to cause the
Registration Statement to become effective, and will notify the Representatives
promptly, and will confirm such advice in writing, (i) when the Registration
Statement has become effective and when any post-effective amendment thereto
becomes effective, (ii) of any request by the Commission for amendments or
supplements to the Registration Statement or the Prospectus or for additional
information, (iii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the initiation of
any proceedings for that purpose or the threat thereof, (iv) of the happening of
any event during the period mentioned in the second sentence of Section 5(e)
that in the judgment of the Company makes any statement made in the Registration
Statement or the Prospectus untrue or that requires the making of any changes in
the Registration Statement or the Prospectus in order to make the statements
therein, in the light of the circumstances in which they are made, not
misleading and (v) of receipt by the Company or any representative or attorney
of the Company of any other communication from the Commission relating to the
Company, the Registration Statement, any Preliminary Prospectus or the
Prospectus. If at any time the Commission shall issue any order suspending the
effectiveness of the Registration Statement, the Company will make every
reasonable effort to obtain the withdrawal of such order at the earliest
possible moment. If the Company has omitted any information from the
Registration Statement pursuant to Rule 430A of the Rules and Regulations, the
Company will comply with the provisions of and make all requisite filings with
the Commission pursuant to said Rule 430A and notify the Representatives
promptly of all such filings.
(c) The Company will furnish to each Representative, without
charge, one signed copy of each of the Registration Statement and of any
post-effective amendment thereto, including financial statements and schedules,
and all exhibits thereto and will furnish to the Representatives, without
charge, for transmittal to each of the other Underwriters, a copy of the
Registration Statement and any post-effective amendment thereto, including
financial statements and schedules but without exhibits.
(d) The Company will comply with all the provisions of any
undertakings contained in the Registration Statement.
(e) On the Effective Date, and thereafter from time to time, the
Company will deliver to each of the Underwriters, without charge, as many copies
of the Prospectus or any amendment or supplement thereto as the Representatives
may reasonably request. The Company consents to the use of the Prospectus or any
amendment or supplement thereto by the several Underwriters and by all dealers
to whom the Shares may be sold, both in connection with the offering or sale of
the Shares and for any period of time thereafter during which the Prospectus is
required by law to be delivered in connection therewith. If during such period
of time any event shall occur which in the judgment of the Company or counsel to
the Underwriters should be set forth in the Prospectus in order to make any
statement therein, in the light of the circumstances under which it was made,
not misleading, or if it is necessary to supplement or amend the Prospectus to
comply with law, the Company will forthwith prepare and duly file with the
Commission an appropriate supplement or amendment thereto, and will deliver to
each of the Underwriters, without charge, such number of copies of such
supplement or amendment to the Prospectus as the Representatives may reasonably
request.
(f) Prior to any public offering of the Shares, the Company will
cooperate with the Representatives and counsel to the Underwriters in connection
with the registration or qualification of the Shares for offer and sale under
the securities or Blue Sky laws of such jurisdictions as the Representatives may
request; provided, that in no event shall the Company be obligated to qualify to
do
11
business in any jurisdiction where it is not now so qualified or to take any
action which would subject it to general service of process in any jurisdiction
where it is not now so subject.
(g) The Company will, so long as required under the Rules and
Regulations, furnish to its stockholders as soon as practicable after the end of
each fiscal year an annual report (including a balance sheet and statements of
income, stockholders' equity and cash flow of the Company and its consolidated
Subsidiaries, if any, certified by independent public accountants) and, as soon
as practicable after the end of each of the first three quarters of each fiscal
year (beginning with the fiscal quarter ending after the effective date of the
Registration Statement), consolidated summary financial information of the
Company and its subsidiaries, if any, for such quarter in reasonable detail.
(h) During the period of five years commencing on the Effective
Date, the Company will furnish to the Representatives and each other Underwriter
who may so request copies of such financial statements and other periodic and
special reports as the Company may from time to time distribute generally to the
holders of any class of its capital stock, and will furnish to the
Representatives and each other Underwriter who may so request a copy of each
annual or other report it shall be required to file with the Commission.
(i) The Company will make generally available to holders of its
securities as soon as may be practicable but in no event later than the last day
of the fifteenth full calendar month following the calendar quarter in which the
Effective Date falls, an earnings statement (which need not be audited but shall
be in reasonable detail) for a period of 12 months ended commencing after the
Effective Date, and satisfying the provisions of Section 11(a) of the Act
(including Rule 158 of the Rules and Regulations).
(j) Whether or not the transactions contemplated by this
Agreement are consummated or this Agreement is terminated, the Company will pay
or reimburse if paid by the Representatives all costs and expenses incident to
the performance of the obligations of the Company and the Selling Stockholders
under this Agreement and in connection with the transactions contemplated
hereby, including but not limited to costs and expenses of or relating to (i)
the preparation, printing and filing of the Registration Statement and exhibits
to it, each Preliminary Prospectus, Prospectus and any amendment or supplement
to the Registration Statement or Prospectus, (ii) the preparation and delivery
of certificates representing the Shares, (iii) the printing of this Agreement,
the Agreement Among Underwriters, any Selected Dealer Agreements, any
Underwriters' Questionnaires, the Stockholders' Agreements, any Underwriters'
Powers of Attorney, and any invitation letters to prospective Underwriters, (iv)
furnishing (including costs of shipping and mailing) such copies of the
Registration Statement, the Prospectus and any Preliminary Prospectus, and all
amendments and supplements thereto, as may be requested for use in connection
with the offering and sale of the Shares by the Underwriters or by dealers to
whom Shares may be sold, (v) the listing of the Shares on the American Stock
Exchange, (vi) any filings required to be made by the Underwriters with the
NASD, and the fees, disbursements and other charges of counsel for the
Underwriters in connection therewith, (vii) the registration or qualification of
the Shares for offer and sale under the securities or Blue Sky laws of such
jurisdictions designated pursuant to Section 5(f), including the fees,
disbursements and other charges of counsel to the Underwriters in connection
therewith, and the preparation and printing of preliminary, supplemental and
final Blue Sky memoranda, (viii) fees, disbursements and other charges of
counsel to the Company (but not those of counsel for the Underwriters, except as
otherwise provided herein), (ix) the transfer agent for the Shares and (x) any
fees and expenses of the Attorneys-in-Fact and the Custodian. The Underwriters
may deem the Company to be the primary obligor with respect to all costs, fees
and expenses to be paid by the Company and by the Selling Stockholders. The
Selling Stockholders will pay (directly or by reimbursement) all fees and
expenses incident to the performance of their obligations under this Agreement
that are not otherwise specifically provided for herein, including but not
limited to any fees and expenses of counsel for such Selling Stockholders, and
all
12
expenses and taxes incident to the sale and delivery of the Shares to be sold by
such Selling Stockholders to the Underwriters hereunder.
(k) The Company will not at any time, directly or indirectly,
take any action designed or which might reasonably be expected to cause or
result in, or which will constitute, stabilization of the price of the shares of
Common Stock to facilitate the sale or resale of any of the Shares.
(l) The Company will apply the net proceeds from the offering and
sale of the Shares to be sold by the Company in the manner set forth in the
Prospectus under "Use of Proceeds."
(m) During the period beginning from the date hereof and
continuing to and including the date 90 days after the date of the Prospectus,
without the prior written consent of ▇▇▇▇▇▇▇ & Company, Inc., the Company will
not offer, sell, contract to sell, grant options to purchase or otherwise
dispose of any of the Company's equity securities of the Company or any other
securities convertible into or exchangeable with its Common Stock or other
equity security (other than pursuant to employee stock option plans or the
conversion of convertible securities or the exercise of warrants outstanding on
the date of this Agreement). During the period of 90 days after the date of the
Prospectus, the Company will not file with the Commission or cause to become
effective any registration statement relating to any securities of the Company
without the prior written consent of ▇▇▇▇▇▇▇ & Company, Inc. During the period
of 90 days after the date of the Prospectus, the Company will not, without the
prior written consent of ▇▇▇▇▇▇▇ & Company, Inc., grant options to purchase
shares of Common Stock at a price less than the initial public offering price.
(n) The Selling Stockholders will, and the Company will cause
each of its officers and directors and certain Stockholders designated by the
Representatives to enter into lock-up agreements with the Representatives to the
effect that they will not, without the prior written consent of ▇▇▇▇▇▇▇ &
Company, Inc., sell, contract to sell or otherwise dispose of any shares of
Common Stock or rights to acquire such shares according to the terms set forth
in Schedule IV hereto.
(o) The Company will not file with the Commission any
registration statement on Form S-8 relating to shares of its Common Stock prior
to 90 days after the effective date of the Registration Statement.
6. Conditions of the Obligations of the Underwriters. The obligations of
each Underwriter hereunder are subject to the following conditions:
(a) Notification that the Registration Statement has become
effective shall be received by the Representatives not later than 5:00 p.m., New
York City time, on the date of this Agreement or at such later date and time as
shall be consented to in writing by the Representatives and all filings required
by Rule 424 and Rule 430A of the Rules and Regulations shall have been made.
(b) (i) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall be pending or threatened by the Commission, (ii) no order
suspending the effectiveness of the Registration Statement or the qualification
or registration of the Shares under the securities or Blue Sky laws of any
jurisdiction shall be in effect and no proceeding for such purpose shall be
pending before or threatened or contemplated by the Commission or the
authorities of any such jurisdiction, (iii) any request for additional
information on the part of the staff of the Commission or any such authorities
shall have been complied with to the satisfaction of the staff of the Commission
or such authorities and (iv) after the date hereof no amendment or supplement to
the Registration Statement or the Prospectus shall have been filed unless a copy
thereof was first submitted to the Representatives and the Representatives do
not object thereto in
13
good faith, and the Representatives shall have received certificates, dated the
Closing Date and, if later, the Option Closing Date and signed by the Chief
Executive Officer and the Chief Financial Officer of the Company (who may, as to
proceedings threatened, rely upon the best of their information and belief), to
the effect of clauses (i), (ii) and (iii) of this paragraph.
(c) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus, (i) there shall not have been
a Material Adverse Effect, whether or not arising from transactions in the
ordinary course of business, other than as described in or contemplated by the
Registration Statement and the Prospectus, and (ii) the Company or any of its
Subsidiaries shall not have sustained any material loss or interference with its
business or properties from fire, explosion, flood or other casualty, whether or
not covered by insurance, or from any labor dispute or any court or legislative
or other governmental action, order or decree, which is not described in the
Registration Statement and the Prospectus, if in the judgment of the
Representatives any such development makes it impracticable or inadvisable to
consummate the sale and delivery of the Shares by the Underwriters at the
initial public offering price.
(d) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus, there shall have been no
litigation or other proceeding instituted against the Company, any Subsidiary or
any of their respective officers or directors in their capacities as such,
before or by any Federal, state or local court, commission, regulatory body,
administrative agency or other governmental body, domestic or foreign, in which
litigation or proceeding an unfavorable ruling, decision or finding could, in
the judgment of the Representatives, result in a Material Adverse Effect.
(e) Each of the representations and warranties of the Company and
the Selling Stockholders contained herein shall be true and correct in all
material respects at the Closing Date, and, with respect to the Option Shares,
at the Option Closing Date, and all covenants and agreements contained herein to
be performed on the part of the Company or the Selling Stockholders and all
conditions contained herein to be fulfilled or complied with by the Company or
the Selling Stockholders at or prior to the Closing Date and, with respect to
the Option Shares, at or prior to the Option Closing Date, shall have been duly
performed, fulfilled or complied with.
(f) The Representatives shall have received an opinion, dated the
Closing Date and, with respect to the Option Shares, the Option Closing Date,
satisfactory in form and substance to the Representatives and counsel for the
Underwriters from ▇▇▇▇▇▇▇▇ & English, LLP, counsel to the Company and the
Selling Stockholders, with respect to the following matters:
(i) Each of the Company and its Subsidiaries is a
corporation duly organized, validly existing and in good standing under
the laws of its jurisdiction of incorporation; has full corporate power
and authority to conduct all the activities conducted by it, to own or
lease all the assets owed or leased by it and to conduct its business
as contemplated by the Registration Statement and Prospectus; and is
duly licensed or qualified to do business and is in good standing as a
foreign corporation in all jurisdictions in which the nature of the
activities conducted by it or the character of the assets owned or
leased by it makes such license or qualification necessary and where
the failure to be licensed or qualified might have a Material Adverse
Effect.
(ii) All of the outstanding shares of capital stock of
the Company (including the Selling Stockholders Shares) have been duly
authorized, validly issued and are fully paid and nonassessable, to
such counsel's knowledge, were issued pursuant to exemptions from the
registration and qualification requirements of federal and applicable
state securities laws, and were not issued in violation of or subject
to any preemptive or, to such counsel's knowledge, similar rights.
14
(iii) The specimen certificate evidencing the Common Stock
filed as an exhibit to the Registration Statement is in due and proper
form under New Jersey law, the Shares have been duly authorized and,
when issued and paid for as contemplated by this Agreement, will be
validly issued, fully paid and nonassessable; and no preemptive or
similar rights exist with respect to any of the Shares or the issue and
sale thereof.
(iv) To such counsel's knowledge, except for the
Subsidiaries, the Company does not own or control, directly or
indirectly, any shares of stock or any other equity or long-term debt
securities of any corporation or have any equity interest in any
corporation, firm, partnership, joint venture, association or other
entity. All of the outstanding shares of capital stock of each
Subsidiary have been duly authorized and validly issued and are fully
paid and nonassessable, and are owned by the Company free and clear of
all claims, liens, charges and encumbrances. To such counsel's
knowledge, there are no securities outstanding that are convertible
into or exercisable or exchangeable for capital stock of any
Subsidiary.
(v) The authorized and outstanding capital stock of the
Company is as set forth in the Registration Statement and the
Prospectus in the column entitled "Actual" under the caption
"Capitalization" (except for subsequent issuances, if any, pursuant to
this Agreement or pursuant to reservations, agreements, employee
benefit plans or the exercise of convertible securities, options or
warrants referred to in the Prospectus). To such counsel's knowledge,
except as disclosed in or specifically contemplated by the Prospectus,
there are no outstanding options, warrants of other rights calling for
the issuance of, and no commitments, plans or arrangements to issue,
any shares of capital stock of the Company or any security convertible
into or exchangeable or exercisable for capital stock of the Company.
The description of the capital stock of the Company in the Registration
Statement and the Prospectus conforms in all material respects to the
terms thereof.
(vi) To such counsel's knowledge, there are no legal or
governmental proceedings pending or threatened to which the Company or
any of its Subsidiaries is or would be a party or to which any of their
respective properties is subject that are required to be described in
the Registration Statement or the Prospectus but are not so described.
(vii) No consent, approval, authorization or order of, or
any filing or declaration with, any court or governmental agency or
body is required for the consummation by the Company of the
transactions on its part contemplated under this Agreement, except such
as have been obtained or made under the Act or the Rules and
Regulations and such as may be required under state securities or Blue
Sky laws or the by-laws and rules of the NASD in connection with the
purchase and distribution by the Underwriters of the Shares.
(viii) The Company has full corporate power and authority
to enter into this Agreement. This Agreement has been duly authorized,
executed and delivered by the Company.
(ix) The execution and delivery of this Agreement, the
compliance by the Company with all of the terms hereof or thereof and
the consummation of the transactions contemplated hereby does not
contravene any provision of applicable law or the charter or by-laws of
the Company or any of its Subsidiaries, and to such counsel's
knowledge, will not result in the creation or imposition of any lien,
charge or encumbrance upon any of the assets of the Company or any of
its Subsidiaries pursuant to the terms and provisions of, result in a
breach or violation of any of the terms or provisions of, or constitute
a default under, or give any party a right to terminate any of its
obligations under, or result in the acceleration of any obligation
15
under, any indenture, mortgage, deed of trust, voting trust agreement,
loan agreement, bond, debenture, note agreement or other evidence of
indebtedness, lease, contract or other agreement or instrument known to
such counsel to which the Company or any of its Subsidiaries is a party
or by which the Company or any of its Subsidiaries or any of their
respective properties is bound or affected, or violate or conflict with
(i) any judgment, ruling, decree or order known to such counsel or (ii)
any statute, rule or regulation of any court or other governmental
agency or body, applicable to the business or properties of the Company
or any of its Subsidiaries.
(x) To such counsel's knowledge, there is no document or
contract of a character required to be described in the Registration
Statement or the Prospectus or to be filed as an exhibit to the
Registration Statement which is not described or filed as required, and
each description of such contracts and documents that is contained in
the Registration Statement and Prospectus fairly presents in all
material respects the information required under the Act and the Rules
and Regulations.
(xi) The statements under the captions ["Risk Factors --
"_______," "______," "Prospectus Summary -- Recent Developments,"
"Management - Company Stock Option Plans," "Management - Employment
Contracts and Termination of Employment Arrangements," "Certain
Transactions," "Description of Capital Stock," and "Shares Eligible for
Future Sale"] in the Prospectus, insofar as the statements constitute a
summary of documents referred to therein or matters of law, are
accurate summaries and fairly and correctly present, in all material
respects, the information called for with respect to such documents and
matters (provided, however, that such counsel may rely on
representations of the Company with respect to the factual matters
contained in such statements, and provided further that such counsel
shall state that nothing has come to the attention of such counsel
which leads them to believe that such representations are not true and
correct in all material respects).
(xii) The Company is not an "investment company" or an
"affiliated person" of, or "promoter" or "principal underwriter" for,
an "investment company," as such terms are defined in the Investment
Company Act of 1940, as amended.
(xiii) The Shares have been duly authorized for listing on
the American Stock Exchange, subject to notice of issuance.
(xiv) To such counsel's knowledge, no holder of securities
of the Company has rights, which have not been waived or satisfied, to
require the register with the Commission shares of Common Stock or
other securities, as part of the offering contemplated hereby.
(xv) The Registration Statement has become effective
under the Act, and to the best of such counsel's knowledge, no stop
order suspending the effectiveness of the Registration Statement has
been issued and no proceeding for that purpose has been instituted or
is pending, threatened or contemplated.
(xvi) The Registration Statement and the Prospectus comply
as to form in all material respects with the requirement of the Act and
the Rules and Regulations (other than the financial statements,
schedules and other financial data contained in the Registration
Statement or the Prospectus, as to which such counsel need express no
opinion).
(xvii) Such counsel has participated in the preparation of
the Registration Statement and Prospectus and has no reason to believe
that, as of the Effective Date the Registration Statement, or any
amendment or supplement thereto, (other than the financial statements,
16
schedules and other financial data contained therein, as to which such
counsel need express no opinion) contained any untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or
that the Prospectus, or any amendment or supplement thereto, as of its
date and the Closing Date and, if later, the Option Closing Date,
contained or contains any untrue statement of a material fact or
omitted or omits to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading (other than the financial statements,
schedules and other financial data contained therein, as to which such
counsel need express no opinion).
In rendering such opinion, such counsel may rely upon as to matters of
local law on opinions of counsel satisfactory in form and substance to the
Representatives and counsel for the Underwriters, provided that the opinion of
counsel to the Company and the Selling Stockholders shall state that they are
doing so, that they have no reason to believe that they and the Underwriters are
not entitled to rely on such opinions and that copies of such opinions are to be
attached to the opinion.
(g) The Representatives shall have received an opinion, dated the
Closing Date and the Option Closing Date, from ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇, counsel
to the Underwriters, with respect to the Registration Statement, the Prospectus
and this Agreement, which opinion shall be satisfactory in all respects to the
Representatives.
(h) Concurrently with the execution and delivery of this
Agreement, the Accountants shall have furnished to the Representatives a letter,
dated the date of its delivery, addressed to the Representatives and in form and
substance satisfactory to the Representatives, confirming that they are
independent accountants with respect to the Company and its Subsidiaries as
required by the Act and the Rules and Regulations and with respect to certain
financial and other statistical and numerical information contained in the
Registration Statement. At the Closing Date and, as to the Option Shares, the
Option Closing Date, the Accountants shall have furnished to the Representatives
a letter, dated the date of its delivery, which shall confirm, on the basis of a
review in accordance with the procedures set forth in the letter from the
Accountants, that nothing has come to their attention during the period from the
date of the letter referred to in the prior sentence to a date (specified in the
letter) not more than five days prior to the Closing Date and the Option Closing
Date, as the case may be, which would require any change in their letter dated
the date hereof if it were required to be dated and delivered at the Closing
Date and the Option Closing Date.
(i) Concurrently with the execution and delivery of this
Agreement and at the Closing Date and, as to the Option Shares, the Option
Closing Date, there shall be furnished to the Representatives a certificate,
dated the date of its delivery, signed by each of the Chief Executive Officer
and the Chief Financial Officer of the Company, in form and substance
satisfactory to the Representatives, to the effect that:
(i) Each signer of such certificate has carefully
examined the Registration Statement and the Prospectus and (A) as of
the date of such certificate, such documents are true and correct in
all material respects and do not omit to state a material fact required
to be stated therein or necessary in order to make the statements
therein not untrue or misleading and (B) in the case of the certificate
delivered at the Closing Date and the Option Closing Date, since the
Effective Date no event has occurred as a result of which it is
necessary to amend or supplement the Prospectus in order to make the
statements therein not untrue or misleading.
17
(ii) Each of the representations and warranties of the
Company contained in this Agreement were, when originally made, and
are, at the time such certificate is delivered, true and correct.
(iii) Each of the covenants required to be performed by
the Company herein on or prior to the date of such certificate has been
duly, timely and fully performed and each condition herein required to
be satisfied or fulfilled on or prior to the date of such certificate
has been duly, timely and fully satisfied or fulfilled.
(j) Concurrently with the execution and delivery of this
Agreement and at the Closing Date and, as to the Option Shares, the Option
Closing Date, there shall be furnished to the Representatives a certificate,
dated the date of its delivery, signed by the Selling Stockholders (or the
Attorneys-in-Fact on their behalf), in form and substance satisfactory to the
Representatives, to the effect that the representations and warranties of the
Selling Stockholders contained herein are true and correct in all material
respects on and as of the date of such certificate as if made on and as of the
date of such certificate, and each of the covenants and conditions required
herein to be performed or complied with by the Selling Stockholders on or prior
to the date of such certificate has been duly, timely and fully performed or
complied with.
(k) The Shares shall be qualified for sale in such jurisdictions
as the Representatives may reasonably request and each such qualification shall
be in effect and not subject to any stop order or other proceeding on the
Closing Date or the Option Closing Date.
(l) Prior to the Closing Date, the Shares shall have been duly
authorized for listing on the American Stock Exchange upon official notice of
issuance.
(m) The Company and the Selling Stockholders shall have furnished
to the Representatives such certificates and opinions of counsel, in addition to
those specifically mentioned herein, as the Representatives may have reasonably
requested as to the accuracy and completeness at the Closing Date and the Option
Closing Date of any statement in the Registration Statement or the Prospectus,
as to the accuracy at the Closing Date and the Option Closing Date of the
representations and warranties of the Company and the Selling Stockholders
herein, as to the performance by the Company and the Selling Stockholders of its
and their respective obligations hereunder, or as to the fulfillment of the
conditions concurrent and precedent to the obligations hereunder of the
Representatives.
7. Indemnification.
(a) The Company will indemnify and hold harmless each
Underwriter, the directors, officers, employees and agents of each Underwriter
and each person, if any, who controls each Underwriter within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, from and against any
and all losses, claims, liabilities, expenses and damages (including any and all
investigative, legal and other expenses reasonably incurred in connection with,
and any amount paid in settlement of, any action, suit or proceeding or any
claim asserted), to which they, or any of them, may become subject under the
Act, the Exchange Act or other Federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, liabilities, expenses
or damages arise out of or are based on any untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement or the Prospectus or any amendment or supplement to the
Registration Statement or the Prospectus, or the omission or alleged omission to
state in such document a material fact required to be stated in it or necessary
to make the statements in it not misleading in the light of the circumstances in
which they were made, or arise out of or are based in whole or in part on any
inaccuracy in the representations and warranties of the Company contained herein
or any failure of
18
the Company to perform its obligations hereunder or under law in connection with
the transactions contemplated hereby; provided, however, that (i) the Company
will not be liable to the extent that such loss, claim, liability, expense or
damage arises from the sale of the Shares in the public offering to any person
by an Underwriter and is based on an untrue statement or omission or alleged
untrue statement or omission made in reliance on and in conformity with
information relating to any Underwriter furnished in writing to the Company by
the Representatives, on behalf of any Underwriter, expressly for inclusion in
the Registration Statement, the Preliminary Prospectus or the Prospectus and
(ii) the Company will not be liable to any Underwriter, the directors, officers,
employees or agents of such Underwriter or any person controlling such
Underwriter with respect to any loss, claim, liability, expense, or damage
arising out of or based on any untrue statement or omission or alleged untrue
statement or omission or alleged omission to state a material fact in the
Preliminary Prospectus which is corrected in the Prospectus if the person
asserting any such loss, claim, liability, charge or damage purchased Shares
from such Underwriter but was not sent or given a copy of the Prospectus at or
prior to the written confirmation of the sale of such Shares to such person. The
Company acknowledges that the statements set forth under the heading
"Underwriting" in the Preliminary Prospectus and the Prospectus constitute the
only information relating to any Underwriter furnished in writing to the Company
by the Representatives on behalf of the Underwriters expressly for inclusion in
the Registration Statement, the Preliminary Prospectus or the Prospectus. This
indemnity agreement will be in addition to any liability that the Company might
otherwise have.
(b) Each Selling Stockholder will indemnify and hold harmless
each Underwriter, the directors, officers, employees and agents of each
Underwriter and each person, if any, who controls each Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, liabilities, expenses and damages (including
any and all investigative, legal and other expenses reasonably incurred in
connection with, and any amount paid in settlement of, any action, suit or
proceeding or any claim asserted), to which the Selling Stockholders, or any of
them, may become subject under the Act, the Exchange Act or other Federal or
state statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, liabilities, expenses or damages arise out of or are based on
any untrue statement or alleged untrue statement of a material fact contained in
any Preliminary Prospectus, the Registration Statement or the Prospectus or any
amendment or supplement to the Registration Statement or the Prospectus, or the
omission or alleged omission to state in such document a material fact required
to be stated in it or necessary to make the statements in it not misleading in
the light of the circumstances in which they were made, or arise out of or are
based in whole or in part on any inaccuracy in the representations and
warranties of the Selling Stockholder contained herein or any failure of the
Selling Stockholder to perform its obligations hereunder or under law in
connection with the transactions contemplated hereby; provided, however, that
(i) the Selling Stockholder will not be liable to the extent that such loss,
claim, liability, expense or damage arises from the sale of the Shares in the
public offering to any person by an Underwriter and is based on an untrue
statement or omission or alleged untrue statement or omission made in reliance
on and in conformity with information relating to any Underwriter furnished in
writing to the Company by the Representatives, on behalf of any Underwriter,
expressly for inclusion in the Registration Statement, the Preliminary
Prospectus or the Prospectus; (ii) the Selling Stockholder will not be liable to
any Underwriter, the directors, officers, employees or agents of such
Underwriter or any person controlling such Underwriter with respect to any loss,
claim, liability, expense, or damage arising out of or based on any untrue
statement or omission or alleged untrue statement or omission or alleged
omission to state a material fact in the Preliminary Prospectus which is
corrected in the Prospectus if the person asserting any such loss, claim,
liability, charge or damage purchased Shares from such Underwriter but was not
sent or given a copy of the Prospectus at or prior to the written confirmation
of the sale of such Shares to such person and if copies of the Prospectus were
timely delivered to such Underwriter pursuant to Section 5 hereof; (iii) each
Selling Stockholder will be liable under this Section 7(b) with respect to any
untrue statement or omission or alleged untrue statement or omission to the
extent, and only to the
19
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission has been made in any Preliminary Prospectus, the Registration
Statement or the Prospectus or any amendment or supplement to the Registration
Statement or the Prospectus in reliance upon and in conformity with written
information furnished to the Company by such Selling Stockholder specifically
for use in the preparation thereof, and (iv) the liability of each Selling
Stockholder under this Section 7(b) shall not exceed the product of the purchase
price (less underwriting discount) for each Share set forth in Section 1(a)
hereof multiplied by the number of Shares sold by such Selling Stockholder
hereunder. This indemnity agreement will be in addition to any liability that
the Selling Stockholder might otherwise have.
(c) Each Underwriter will indemnify and hold harmless the
Company, each director of the Company, each officer of the Company who signs the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, and each
Selling Stockholder to the same extent as the foregoing indemnity from the
Company and each Selling Stockholder to each Underwriter, as set forth in
Sections 7(a) and 7(b), but only insofar as losses, claims, liabilities,
expenses or damages arise out of or are based on any untrue statement or
omission or alleged untrue statement or omission made in reliance on and in
conformity with information relating to any Underwriter furnished in writing to
the Company by the Representatives, on behalf of such Underwriter, expressly for
use in the Registration Statement, the Preliminary Prospectus or the Prospectus.
The Company and the Selling Stockholders acknowledge that the statements set
forth under the heading "Underwriting" in the Preliminary Prospectus and the
Prospectus constitute the only information relating to any Underwriter furnished
in writing to the Company by the Representatives on behalf of the Underwriters
expressly for inclusion in the Registration Statement, the Preliminary
Prospectus or the Prospectus. This indemnity will be in addition to any
liability that each Underwriter might otherwise have.
(d) Any party that proposes to assert the right to be indemnified
under this Section 7 shall, promptly after receipt of notice of commencement of
any action against such party in respect of which a claim is to be made against
an indemnifying party or parties under this Section 7, notify each such
indemnifying party in writing of the commencement of such action, enclosing with
such notice a copy of all papers served, but the omission so to notify such
indemnifying party will not relieve it from any liability that it may have to
any indemnified party under the foregoing provisions of this Section 7 unless,
and only to the extent that, such omission results in the loss of substantive
rights or defenses by the indemnifying party. If any such action is brought
against any indemnified party and it notifies the indemnifying party of its
commencement, the indemnifying party will be entitled to participate in and, to
the extent that it elects by delivering written notice to the indemnified party
promptly after receiving notice of the commencement of the action from the
indemnified party, jointly with any other indemnifying party similarly notified,
to assume the defense of the action, with counsel reasonably satisfactory to the
indemnified party. After notice from the indemnifying party to the indemnified
party of its election to assume the defense, the indemnifying party will not be
liable to the indemnified party for any legal or other expenses except as
provided below and except for the reasonable costs of investigation subsequently
incurred by the indemnified party in connection with the defense. The
indemnified party will have the right to employ its own counsel in any such
action, but the fees, expenses and other charges of such counsel will be at the
expense of such indemnified party unless (i) the employment of counsel by the
indemnified party has been authorized in writing by the indemnifying party, (ii)
the indemnified party has reasonably concluded (based on advice of counsel) that
there may be legal defenses available to it or other indemnified parties that
are different from or in addition to those available to the indemnifying party,
(iii) a conflict or potential conflict exists (based on advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party (in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party) or (iv) the indemnifying
party has not in fact employed counsel to
20
assume the defense of such action within a reasonable time after receiving
notice of the commencement of the action, in each of which cases the reasonable
fees, disbursements and other charges of counsel will be at the expense of the
indemnifying party or parties. It is understood that the indemnifying party or
parties shall not, in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for the reasonable fees, disbursements and
other charges of more than one separate firm admitted to practice in such
jurisdiction at any one time for all such indemnified party or parties. All such
fees, disbursements and other charges will be reimbursed by the indemnifying
party promptly as they are incurred. Any indemnifying party will not be liable
for any settlement of any action or claim effected without its written consent
(which consent will not be unreasonably withheld).
(e) If the indemnification provided for in this Section 7 is
applicable in accordance with its terms but for any reason is held to be
unavailable to or insufficient to hold harmless an indemnified party under
paragraphs (a), (b) and (c) of this Section 7 in respect of any losses, claims,
liabilities, expenses and damages referred to therein, then each applicable
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable (including any investigative, legal and
other expenses reasonably incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claim asserted, but after
deducting any contribution received by the Company or the Selling Stockholders
from persons other than the Underwriters, such as persons who control the
Company within the meaning of the Act, officers of the Company who signed the
Registration Statement and directors of the Company, who also may be liable for
contribution) by such indemnified party as a result of such losses, claims,
liabilities, expenses and damages in such proportion as shall be appropriate to
reflect the relative benefits received by the Company and the Selling
Stockholders, on the one hand, and the Underwriters, on the other hand. The
relative benefits received by the Company and the Selling Stockholders, on the
one hand, and the Underwriters, on the other hand, shall be deemed to be in the
same proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company and the Selling Stockholders bear to the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover page of the Prospectus. If, but only
if, the allocation provided by the foregoing sentence is not permitted by
applicable law, the allocation of contribution shall be made in such proportion
as is appropriate to reflect not only the relative benefits referred to in the
foregoing sentence but also the relative fault of the Company and the Selling
Stockholders, on the one hand, and the Underwriters, on the other hand, with
respect to the statements or omissions which resulted in such loss, claim,
liability, expense or damage, or action in respect thereof, as well as any other
relevant equitable considerations with respect to such offering. Such relative
fault shall be determined by reference to whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by the Company and the Selling Stockholders
or the Representatives on behalf of the Underwriters, the intent of the parties
and their relative knowledge, access to information and opportunity to correct
or prevent such statement or omission. The Company and the Underwriters agree
that it would not be just and equitable if contributions pursuant to this
Section 7(e) were to be determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other method
of allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the loss claim, liability, expense or damage, or action in respect
thereof, referred to above in this Section 7(e) shall be deemed to include, for
purposes of this Section 7(e), any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 7(e), (i) no
Underwriter shall be required to contribute any amount in excess of the
underwriting discounts received by it, (ii) no person found guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) will be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation, and (iii) no Selling Stockholder shall be required to
contribute any amount in excess of the proceeds received by the Selling
Stockholder from the Underwriters in this offering. The
21
Underwriters' obligations to contribute as provided in this Section 7(e) are
several in proportion to their respective underwriting obligations and not
joint. For purposes of this Section 7(e), any person who controls a party to
this Agreement within the meaning of the Act will have the same rights to
contribution as that party, and each officer of the Company who signed the
Registration Statement will have the same rights to contribution as the Company,
subject in each case to the provisions hereof. Any party entitled to
contribution, promptly after receipt of notice of commencement of any action
against any such party in respect of which a claim for contribution may be made
under this Section 7(e), will notify any such party or parties from whom
contribution may be sought, but the omission so to notify will not relieve the
party or parties from whom contribution may be sought from any other obligation
it or they may have under this Section 7(e). No party will be liable for
contribution with respect to any action or claim settled without its written
consent (which consent will not be unreasonably withheld or delayed).
(f) The indemnity and contribution agreements contained in this
Section 7 and the representations and warranties of the Company and the Selling
Stockholders contained in this Agreement shall remain operative and in full
force and effect regardless of (i) any investigation made by or on behalf of the
Underwriters, (ii) acceptance of any of the Shares and payment therefor or (iii)
any termination of this Agreement.
8. Reimbursement of Certain Expenses. In addition to its other obligations
under Section 7(a) of this Agreement, the Company hereby agrees to reimburse on
a quarterly basis the Underwriters for all reasonable legal and other expenses
incurred in connection with investigating or defending any claim, action,
investigation, inquiry or other proceeding arising out of or based upon, in
whole or in part, any statement or omission or alleged statement or omission, or
any inaccuracy in the representations and warranties of the Company or the
Selling Stockholders contained herein or failure of the Company or the Selling
Stockholders to perform its or their respective obligations hereunder or under
law, all as described in Section 7(a) and 7(b), notwithstanding the absence of a
judicial determination as to the propriety and enforceability of the obligations
under this Section 8 and the possibility that such payment might later be held
to be improper; provided, however, that, to the extent any such payment is
ultimately held to be improper, the persons receiving such payments shall
promptly refund them.
9. Termination. The obligations of the several Underwriters under this
Agreement may be terminated at any time on or prior to the Closing Date (or,
with respect to the Option Shares, on or prior to the Option Closing Date), by
notice to the Company and the Selling Stockholders from the Representatives,
without liability on the part of any Underwriter to the Company if, prior to
delivery and payment for the Firm Shares or Option Shares, as the case may be,
in the sole judgment of the Representatives, (i) trading in any of the equity
securities of the Company shall have been suspended by the Commission or by the
American Stock Exchange, (ii) trading in securities generally on the American
Stock Exchange shall have been suspended or limited or minimum or maximum prices
shall have been generally established on such exchange, or additional material
governmental restrictions, not in force on the date of this Agreement, shall
have been imposed upon trading in securities generally by such exchange, by
order of the Commission or any court or other governmental authority, or by the
American Stock Exchange, (iii) a general banking moratorium shall have been
declared by either Federal or New York State authorities or (iv) any material
adverse change in the financial or securities markets in the United States or in
political, financial or economic conditions in the United States or any outbreak
or material escalation of hostilities or other calamity or crisis shall have
occurred, the effect of which is such as to make it, in the sole judgment of the
Representatives, impracticable or inadvisable to proceed with completion of the
public offering or the delivery of and payment for the Shares.
If this Agreement is terminated pursuant to Sections 9 or 11 hereof,
neither the Company nor any Selling Stockholder shall be under any liability to
any Underwriter except as provided in Sections
22
5(j), 7 and 8 hereof; but, if due to a breach of this Agreement by the Company
or the Selling Stockholders, the purchase of the Shares by the Underwriters is
not consummated or if for any reason the Company shall be unable to perform its
obligations hereunder, the Company will reimburse the several Underwriters for
all out-of-pocket expenses (including the fees, disbursements and other charges
of counsel to the Underwriters) incurred by them in connection with the offering
of the Shares.
10. Representations and Agreements to Survive Delivery. All
representations, warranties, covenants and agreements contained in this
Agreement shall be deemed to be representations, warranties, covenants and
agreements at the Closing Date and the Option Closing Date, and such
representations, warranties, covenants and agreements of the Underwriters, the
Company and the Selling Stockholders, including the agreements contained in
Section 5 and the indemnity and contribution agreements contained in Section 7,
shall remain operative and in full force and effect regardless of any
investigation made by, or on behalf of, the Company, the Selling Stockholders or
the Underwriters or any person or entity which is entitled to be indemnified
under Section 6, and shall survive delivery of the Firm Shares or the Option
Shares. In addition, the provisions of Sections 7, 8, 9, 10 and 13 shall survive
termination of this Agreement, whether such termination occurs before or after
the Closing Date or the Option Closing Date.
11. Substitution of Underwriters. If any one or more of the Underwriters
shall fail or refuse to purchase any of the Firm Shares which it or they have
agreed to purchase hereunder, and the aggregate number of Firm Shares which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
is not more than one-tenth of the aggregate number of Firm Shares, the other
Underwriters shall be obligated, severally, to purchase the Firm Shares which
such defaulting Underwriter or Underwriters agreed but failed or refused to
purchase, in the proportions which the number of Firm Shares which they have
respectively agreed to purchase pursuant to Section 1 bears to the aggregate
number of Firm Shares which all such non-defaulting Underwriters have so agreed
to purchase, or in such other proportions as the Representatives may specify;
provided that in no event shall the maximum number of Firm Shares which any
Underwriter has become obligated to purchase pursuant to Section 1 be increased
pursuant to this Section 11 by more than one-ninth of such number of Firm Shares
without the prior written consent of such Underwriter. If any Underwriter or
Underwriters shall fail or refuse to purchase any Firm Shares and the aggregate
number of Firm Shares which such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase exceeds one-tenth of the aggregate number of
the Firm Shares and arrangements satisfactory to the Representatives and the
Company for the purchase of such Firm Shares are not made within 48 hours after
such default, this Agreement will terminate without liability on the part of any
non-defaulting Underwriter, the Company or the Selling Stockholder for the
purchase or sale of any Shares under this Agreement. In any such case either the
Representatives or the Company shall have the right to postpone the Closing
Date, but in no event for longer than seven days, in order that the required
changes, if any, in the Registration Statement and the Prospectus or in any
other documents or arrangements may be effected. Any action taken pursuant to
this Section 11 shall not relieve any defaulting Underwriter from liability in
respect of any default of such Underwriter under this Agreement.
13. Miscellaneous. Notice given pursuant to any of the provisions of this
Agreement shall be in writing and, unless otherwise specified, shall be mailed
or delivered (a) if to the Company or the Selling Stockholders, at the office of
the Company, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇, ▇▇., with a copy to ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq., ▇▇▇▇▇▇▇▇ & English LLP,
Four Gateway Center, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, or (b) if to
the Underwriters, to the Representatives at the offices of ▇▇▇▇▇▇▇ & Company,
Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Corporate Finance
Department, with a copy to ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq., ▇▇▇▇▇▇, Hall & ▇▇▇▇▇▇▇,
Exchange Place, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇. Any such notice shall be
effective only
23
upon receipt. Any notice under Section 9 or 11 may be made by telex or
telephone, but if so made shall be subsequently confirmed in writing as required
herein.
This Agreement has been and is made solely for the benefit of the
several Underwriters, the Company, the Selling Stockholders and the controlling
persons, directors and officers referred to in Section 7, and their respective
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement. The term "successors and assigns" as used
in this Agreement shall not include a purchaser, as such purchaser, of Shares
from any of the several Underwriters.
Any action required or permitted to be made by the Representatives
under this Agreement may be taken by them jointly or by ▇▇▇▇▇▇▇ & Company, Inc.
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York applicable to contracts made and to be
performed entirely within such State.
This Agreement may be signed in two or more counterparts with the same
effect as if the signatures thereto and hereto were upon the same instrument.
In case any provision in this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
The Company, the Selling Stockholders and the Underwriters each hereby
waive any right they may have to a trial by jury in respect of any claim based
upon or arising out of this Agreement or the transactions contemplated hereby.
24
Please confirm that the foregoing correctly sets forth the agreement
among the Company, the Selling Stockholders and the several Underwriters.
Very truly yours,
MEASUREMENT SPECIALTIES, INC.
By:___________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., Chairman and
Chief Executive Officer
SELLING STOCKHOLDERS
(Named in Schedule II hereto)
By:___________________________________
Attorney-in-Fact
Confirmed as of the date first
above mentioned:
▇▇▇▇▇▇▇ & COMPANY, INC.
FRIEDMAN, BILLINGS, ▇▇▇▇▇▇ & CO., INC.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC
Acting on behalf of themselves
and as the Representatives of
the other several Underwriters
named in Schedule I hereto.
By: ▇▇▇▇▇▇▇ & COMPANY, INC.
By:_________________________
Name:
Title:
SCHEDULE I
UNDERWRITERS
Number of
Firm
Shares
Underwriters to be Purchased
------------ ---------------
▇▇▇▇▇▇▇ & Company, Inc........................................................
Friedman, Billings, ▇▇▇▇▇▇ & Co., Inc.........................................
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLC...................................................
------------
Total..............................................................
============
SCHEDULE IV
FORM OF LOCK-UP AGREEMENT
The undersigned is a holder of securities of Measurement Specialties,
Inc., a New Jersey corporation (the "Company"), and wishes to facilitate the
public offering of shares of the Common Stock (the "Common Stock") of the
Company (the "Offering"). The undersigned recognizes that such Offering will be
of benefit to the undersigned.
In consideration of the foregoing and in order to induce you to act as
underwriters in connection with the Offering, the undersigned hereby agrees that
he, she or it will not, without the prior written approval of ▇▇▇▇▇▇▇ & Company,
Inc., acting on its own behalf and/or on behalf of other representatives of the
underwriters, directly or indirectly, sell, contract to sell, make any short
sale, pledge, or otherwise dispose of, or enter into any hedging transaction
that is likely to result in a transfer of, any shares of Common Stock, options
to acquire shares of Common Stock or securities exchangeable for or convertible
into shares of Common Stock of the Company which he, she or it may beneficially
own (as defined in Rule 13d-3(d)(1) under the Securities Exchange Act of 1934,
as amended), for a period commencing as of the date hereof and ending on the
date which is ninety (90) days after the date of the final Prospectus relating
to the Offering. The undersigned confirms that he, she or it understands that
the underwriters and the Company will rely upon the representations and
agreements set forth in this Agreement in proceeding with the Offering. The
undersigned further confirms that the agreements of the undersigned are
irrevocable and shall be binding upon the undersigned's heirs, legal
representatives, successors and assigns. The undersigned agrees and consents to
the entry of stop transfer instructions with the Company's transfer agent
against the transfer of securities held by the undersigned except in compliance
with this Agreement.
This Agreement shall be binding on the undersigned and his, her or its
respective successors, heirs, personal representatives and assigns.
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Typed or Printed Name
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Signature or Authorized Signature
on behalf of the above Person