Beacon Power Corporation
Shares/1/
Common Stock
($0.01 par value)
Underwriting Agreement
New York, New York
, 2000
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
Banc of America Securities LLC
CIBC World Markets Corp.
As Representatives of the several Underwriters,
c/o ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Beacon Power Corporation, a corporation organized under the laws of
Delaware (the "Company"), proposes to sell to the several underwriters named in
Schedule I hereto (the "Underwriters"), for whom you (the "Representatives") are
acting as representatives, shares of Common Stock, $0.01 par value ("Common
Stock") of the Company (said shares to be issued and sold by the Company being
hereinafter called the "Underwritten Securities"). The Company also proposes to
grant to the Underwriters an option to purchase up to additional shares of
Common Stock to cover over-allotments (the "Option Securities"; the Option
Securities, together with the Underwritten Securities, being hereinafter called
the "Securities"). To the extent there are no additional Underwriters listed on
Schedule I other than you, the term Representatives as used herein shall mean
you, as Underwriters, and the terms Representatives and Underwriters shall mean
either the singular or plural as the context requires. Certain terms used herein
are defined in Section 17 hereof.
As part of the offering contemplated by this Agreement, ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ Inc. has agreed to reserve out of the Securities set forth opposite its
name on the Schedule I to this Agreement, up to shares, for sale to the
Company's employees, officers, and directors and other parties associated with
the Company (collectively, "Participants"), as set forth in the Prospectus under
the heading "Underwriting" (the "Directed Share Program"). The Securities to be
sold by ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. pursuant to the Directed Share Program (the
"Directed Shares") will be sold by ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. pursuant to this
Agreement at the public offering price. Any Directed Shares not orally confirmed
for purchase by any Participants by the end of the business day on which this
Agreement is executed will be offered to the public by ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
as set forth in the Prospectus.
--------------------------------
/1/ Plus an option to purchase from the Company up to additional Securities
to cover over-allotments.
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1. REPRESENTATIONS AND WARRANTIES. The Company represents and warrants to,
and agrees with, each Underwriter as set forth below in this Section 1.
(a) The Company has prepared and filed with the Commission a
registration statement (file number 333-43386) on Form S-1, including a
related preliminary prospectus, for registration under the Act of the
offering and sale of the Securities. The Company may have filed one or more
amendments thereto, including a related preliminary prospectus, each of
which has previously been furnished to you. The Company will next file with
the Commission either (1) prior to the Effective Date of such registration
statement, a further amendment to such registration statement (including
the form of final prospectus) or (2) after the Effective Date of such
registration statement, a final prospectus in accordance with Rules 430A
and 424(b). In the case of clause (2), the Company has included in such
registration statement, as amended at the Effective Date, all information
(other than Rule 430A Information) required by the Act and the rules
thereunder to be included in such registration statement and the
Prospectus. As filed, such amendment and form of final prospectus, or such
final prospectus, shall contain all Rule 430A Information, together with
all other such required information, and, except to the extent the
Representatives shall agree in writing to a modification, shall be in all
substantive respects in the form furnished to you prior to the Execution
Time or, to the extent not completed at the Execution Time, shall contain
only such specific additional information and other changes (beyond that
contained in the latest Preliminary Prospectus) as the Company has advised
you, prior to the Execution Time, will be included or made therein.
(b) On the Effective Date, the Registration Statement did or will,
and when the Prospectus is first filed (if required) in accordance with
Rule 424(b) and on the Closing Date (as defined herein) and on any date
on which Option Securities are purchased, if such date is not the Closing
Date (a "settlement date"), the Prospectus (and any supplements thereto)
will, comply in all material respects with the applicable requirements of
the Act and the rules thereunder; on the Effective Date and at the
Execution Time, the Registration Statement did not or will not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein not misleading; and, on the Effective Date, the
Prospectus, if not filed pursuant to Rule 424(b), will not, and on the
date of any filing pursuant to Rule 424(b) and on the Closing Date and
any settlement date, the Prospectus (together with any supplement
thereto) will not, include any untrue statement of a material fact
or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading; PROVIDED, HOWEVER, that the Company
makes no representations or warranties as to the information contained
in or omitted from the Registration Statement, or the Prospectus (or
any supplement thereto) in reliance upon and in conformity with
information furnished in writing to the Company by or on behalf of any
Underwriter through the Representatives specifically for inclusion in the
Registration Statement or the Prospectus (or any supplement thereto).
(c) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the jurisdiction in which
it is chartered or organized with full corporate power and authority to own
or lease, as the case may be, and to operate its properties and conduct its
business as described
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in the Prospectus, and is duly qualified to do business as a foreign
corporation and is in good standing under the laws of each jurisdiction
which requires such qualification.
(d) The Company does not have any subsidiaries.
(e) The Company's authorized equity capitalization is as set forth in
the Prospectus; the capital stock of the Company conforms in all material
respects to the description thereof contained in the Prospectus; the
outstanding shares of Common Stock have been duly and validly authorized
and issued and are fully paid and nonassessable; the Securities have been
duly and validly authorized, and, when issued and delivered to and paid for
by the Underwriters pursuant to this Agreement, will be fully paid and
nonassessable; the Securities are duly listed, and admitted and authorized
for trading, subject to official notice of issuance and evidence of
satisfactory distribution, on the Nasdaq National Market; the certificates
for the Securities are in valid and sufficient form; the holders of
outstanding shares of capital stock of the Company are not entitled to
preemptive or other rights to subscribe for the Securities, except for such
rights as have been effectively waived; and, except as set forth in the
Prospectus, no options, warrants or other rights to purchase, agreements or
other obligations to issue, or rights to convert any obligations into or
exchange any securities for, shares of capital stock of or ownership
interests in the Company are outstanding;
(f) There is no franchise, contract or other document of a character
required to be described in the Registration Statement or Prospectus, or to
be filed as an exhibit thereto, which is not described or filed as
required; and the statements contained in the Prospectus under the captions
"Risk Factors--Any failure to protect our intellectual property could
seriously impair our competitive position", "Risk Factors--Government
regulation may impair our ability to market our product", "Risk
Factors--Provisions of Delaware law and of our charter and by-laws may
inhibit a takeover that stockholders consider favorable", "Business--Our
Strategy--Protect our intellectual property", "Business--Our Competitive
Advantages--Technological leader", "Business--Our Competitive
Advantages--We design and test our systems with safety in mind",
"Business--Our Technology", "Business--Intellectual Property",
"Business--Government Regulation", "Business--Legal Proceedings", "Certain
Relationships and Related Transactions--Agreement with GE Corporate
Research and Development", "Certain Relationships and Related
Transactions--DQE Enterprises Distribution Agreement", "Certain
Relationships and Related Transactions--Licenses with SatCon", "Certain
Relationships and Related Transactions--Consulting Agreements",
"Description of Capital Stock" and "Shares Eligible for Future Sale",
insofar as such statements summarize legal matters, agreements, documents,
or proceedings discussed therein, are accurate and fair summaries of such
legal matters, agreements, documents or proceedings.
(g) This Agreement has been duly authorized, executed and delivered by
the Company and constitutes a valid and binding obligation of the Company
enforceable in accordance with its terms.
(h) The Company is not and, after giving effect to the offering and
sale of the Securities and the application of the proceeds thereof as
described in the
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Prospectus, will not be an "investment company" as defined in the
Investment Company Act of 1940, as amended.
(i) No consent, approval, authorization, filing with or order of any
court or governmental agency or body is required in connection with the
transactions contemplated herein, except such as have been obtained under
the Act and such as may be required under the blue sky laws of any
jurisdiction in connection with the purchase and distribution of the
Securities by the Underwriters in the manner contemplated herein and in the
Prospectus.
(j) Neither the issue and sale of the Securities nor the consummation
of any other of the transactions herein contemplated nor the fulfillment of
the terms hereof will conflict with, result in a breach or violation or
imposition of any lien, charge or encumbrance upon any property or assets
of the Company pursuant to, (i) the charter or by-laws of the Company, (ii)
the terms of any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation, condition,
covenant or instrument to which the Company is a party or bound or to which
its or their property is subject, or (iii) any statute, law, rule,
regulation, judgment, order or decree applicable to the Company of any
court, regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company or any
of its properties.
(k) No holders of securities of the Company have rights to the
registration of such securities under the Registration Statement, or, if
such rights exist, they have been waived in writing and a copy of such
waiver has been provided to the representatives.
(l) The consolidated historical financial statements and schedules of
the Company included in the Prospectus and the Registration Statement
present fairly in all material respects the financial condition, results of
operations and cash flows of the Company as of the dates and for the
periods indicated, comply as to form with the applicable accounting
requirements of the Act and have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis throughout the
periods involved (except as otherwise noted therein). The selected
financial data set forth under the caption "Selected Financial Data" in the
Prospectus and Registration Statement fairly present, on the basis stated
in the Prospectus and the Registration Statement, the information included
therein.
(m) No action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or its property is pending or, to the best knowledge of the
Company, threatened that (i) could reasonably be expected to have a
material adverse effect on the performance of this Agreement or the
consummation of any of the transactions contemplated hereby or (ii) could
reasonably be expected to have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or properties of
the Company, whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in the
Prospectus (exclusive of any supplement thereto).
(n) The Company owns or leases all such properties as are necessary to
the conduct of its operations as presently conducted.
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(o) The Company is not in violation or default of (i) any provision of
its charter or bylaws, (ii) the terms of any indenture, contract, lease,
mortgage, deed of trust, note agreement, loan agreement or other agreement,
obligation, condition, covenant or instrument to which it is a party or
bound or to which its property is subject, or (iii) any statute, law, rule,
regulation, judgment, order or decree of any court, regulatory body,
administrative agency, governmental body, arbitrator or other authority
having jurisdiction over the Company or any of its properties, as
applicable, except in the case of clauses (ii) and (iii), violations or
defaults which would not have a material adverse effect on the performance
of this Agreement, the consummation of any of the transactions contemplated
hereby or on the condition (financial or otherwise), prospects, earnings,
business or properties of the Company, whether or not arising from
transactions in the ordinary course of business, except as set forth in or
contemplated in the Prospectus (exclusive of any supplement thereto).
(p) Deloitte & Touche, LLP, who have certified certain financial
statements of the Company and delivered their report with respect to the
audited consolidated financial statements and schedules included in the
Prospectus, are independent public accountants with respect to the Company
within the meaning of the Act and the applicable published rules and
regulations thereunder.
(q) There are no transfer taxes or other similar fees or charges under
Federal law or the laws of any state, or any political subdivision thereof,
required to be paid in connection with the execution and delivery of this
Agreement or the issuance by the Company or sale by the Company of the
Securities.
(r) The Company has filed all foreign, federal, state and local tax
returns that are required to be filed or has requested extensions thereof
(except in any case in which the failure so to file would not have a
material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company, whether or not
arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Prospectus (exclusive of any supplement
thereto)) and has paid all taxes required to be paid by it and any other
assessment, fine or penalty levied against it, to the extent that any of
the foregoing is due and payable, except for any such assessment, fine or
penalty that is currently being contested in good faith or as would not
have a material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company, whether or not
arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Prospectus (exclusive of any supplement
thereto).
(s) No labor problem or dispute with the employees of the Company
exists or, to the best of the Company's knowledge, is threatened or
imminent, and the Company is not aware of any existing or imminent labor
disturbance by the employees of any of its principal suppliers, contractors
or customers, that could have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or properties of
the Company, whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in the
Prospectus (exclusive of any supplement thereto).
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(t) The Company is insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are
prudent and customary in the businesses in which they are engaged; all
policies of insurance and fidelity or surety bonds insuring the Company or
any of its businesses, assets, employees, officers and directors are in
full force and effect; the Company is in compliance with the terms of such
policies and instruments in all material respects; and there are no claims
by the Company under any such policy or instrument as to which any
insurance company is denying liability or defending under a reservation of
rights clause; the Company has not been refused any insurance coverage
sought or applied for; and the Company does not have any reason to believe
that it will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage from similar
insurers as may be necessary to continue its business at a cost that would
not have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company,
whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Prospectus
(exclusive of any supplement thereto).
(u) The Company possesses all licenses, certificates, permits and
other authorizations issued by the appropriate federal, state or foreign
regulatory authorities necessary to conduct its business, and the Company
has not received any notice of proceedings relating to the revocation or
modification of any such certificate, authorization or permit which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a material adverse effect on the condition (financial
or otherwise), prospects, earnings, business or properties of the Company,
whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Prospectus
(exclusive of any supplement thereto).
(v) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurance that (i) transactions are
executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(w) The Company has not taken, directly or indirectly, any action
designed to or which has constituted or which might reasonably be expected
to cause or result, under the Exchange Act or otherwise, in stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities.
(x) The Company (i) is in compliance with any and all applicable
foreign, federal, state and local laws and regulations relating to the
protection of human health and safety, the environment or hazardous or
toxic substances or wastes, pollutants or contaminants ("Environmental
Laws"), (ii) has received and is in compliance with all permits, licenses
or other approvals required of it under applicable Environmental Laws to
conduct its business and (iii) has not received
7
notice of any actual or potential liability for the investigation or
remediation of any disposal or release of hazardous or toxic substances or
wastes, pollutants or contaminants, except where such non-compliance with
Environmental Laws, failure to receive required permits, licenses or other
approvals, or liability would not, individually or in the aggregate, have a
material adverse change in the condition (financial or otherwise),
prospects, earnings, business or properties of the Company, whether or not
arising from transactions in the ordinary course of business, except as set
forth in or contemplated in the Prospectus (exclusive of any supplement
thereto). Except as set forth in the Prospectus, the Company has not been
named as a "potentially responsible party" under the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as
amended.
(y) In the ordinary course of its business, the Company periodically
reviews the effect of Environmental Laws on the business, operations and
properties of the Company, in the course of which it identifies and
evaluates associated costs and liabilities (including, without limitation,
any capital or operating expenditures required for clean-up, closure of
properties or compliance with Environmental Laws, or any permit, license or
approval, any related constraints on operating activities and any potential
liabilities to third parties). On the basis of such review, the Company has
reasonably concluded that such associated costs and liabilities would not,
singly or in the aggregate, have a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or properties of
the Company, whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in the
Prospectus (exclusive of any supplement thereto).
(z) The Company has fulfilled its obligations, if any, under the
minimum funding standards of ▇▇▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Employee
Retirement Income Security Act of 1974 ("ERISA") and the regulations and
published interpretations thereunder with respect to each "employee pension
benefit plan" (as defined in Section 3(2) of ERISA and such regulations and
published interpretations) in which employees of the Company are eligible
to participate and each such plan is in compliance in all material respects
with the presently applicable provisions of ERISA and such regulations and
published interpretations. The Company has not incurred any unpaid
liability to the Pension Benefit Guaranty Corporation (other than for the
payment of premiums in the ordinary course) or to any such plan under Title
IV of ERISA.
(aa) The Company owns, possesses, licenses or has other rights to use,
or has the ability to develop or obtain the use of, on reasonable terms,
all patents, patent applications, trade and service marks, trade and
service ▇▇▇▇ registrations, trade names, copyrights, licenses, inventions,
trade secrets, technology, know-how and other intellectual property
(collectively, the "Intellectual Property") necessary for the conduct of
the Company's business as now conducted or as proposed in the Prospectus to
be conducted. Except as set forth in the Prospectus under the caption
"Business--Intellectual Property," to the best of the Company's knowledge,
(a) there are no rights of third parties to any such Intellectual Property,
apart from the U.S. Government's rights arising under technology product
development contracts which have been funded by the U.S. Government; (b)
there is no material infringement by third parties of any such Intellectual
Property of which the Company is aware; (c) there is no pending or, to the
Company's knowledge,
8
threatened action, suit, proceeding or claim by others challenging the
Company's rights in or to any such Intellectual Property, other than normal
patent application examination procedures; (d) there is no pending or, to
the Company's knowledge, threatened action, suit, proceeding or claim by
others challenging the validity or scope of any such Intellectual Property,
other than normal patent application examination procedures; (e) there is
no pending or, to the Company's knowledge, threatened action, suit,
proceeding or claim by others that the Company infringes or otherwise
violates any patent, trademark, copyright, trade secret or other
proprietary rights of others; (f) there is no U.S. patent or published U.S.
patent application to the company's knowledge which contains claims that
dominate or may dominate any Intellectual Property described in the
Prospectus as being owned by or licensed to the Company or that interferes
with the issued or pending claims of any such Intellectual Property; and
(g) there is no prior art of which the Company is aware that may render any
U.S. patent held by the Company invalid or any U.S. patent application held
by the Company unpatentable which has not been disclosed to the U.S. Patent
and Trademark Office.
(bb) Except as disclosed in the Registration Statement and the
Prospectus, the Company (i) does not have any material lending or other
relationship with any bank or lending affiliate of ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney
Holdings Inc. and (ii) does not intend to use any of the proceeds from the
sale of the Securities hereunder to repay any outstanding debt owed to any
affiliate of ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Holding Inc.
Any certificate signed by any officer of the Company and delivered to the
Representatives or counsel for the Underwriters in connection with the offering
of the Securities shall be deemed a representation and warranty by the Company,
as to matters covered thereby, to each Underwriter.
2. PURCHASE AND SALE. (a) Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Company
agrees to sell to each Underwriter, and each Underwriter agrees, severally and
not jointly, to purchase from the Company, at a purchase price of $[ ] per
share, the amount of the Underwritten Securities set forth opposite such
Underwriter's name in Schedule I hereto.
(b) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company hereby grants
an option to the several Underwriters to purchase, severally and not
jointly, up to [ ] Option Securities at the same purchase price per share
as the Underwriters shall pay for the Underwritten Securities. Said option
may be exercised only to cover over-allotments in the sale of the
Underwritten Securities by the Underwriters. Said option 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 the Prospectus upon written or telegraphic
notice by the Representatives to the Company setting forth the number of
shares of the Option Securities as to which the several Underwriters are
exercising the option and the settlement date. The number of Option
Securities to be purchased by each Underwriter shall be the same percentage
of the total number of shares of the Option Securities to be purchased by
the several Underwriters as such Underwriter is purchasing of the
Underwritten Securities, subject to such adjustments as you in your
absolute discretion shall make to eliminate any fractional shares.
9
3. DELIVERY AND PAYMENT. Delivery of and payment for the Underwritten
Securities and the Option Securities (if the option provided for in Section 2(b)
hereof shall have been exercised on or before the third Business Day prior to
the Closing Date) shall be made at 10:00 AM, New York City time, on [ ], 2000 ,
or at such time on such later date not more than three Business Days after the
foregoing date as the Representatives shall designate, which date and time may
be postponed by agreement between the Representatives and the Company or as
provided in Section 9 hereof (such date and time of delivery and payment for the
Securities being herein called the "Closing Date"). Delivery of the Securities
shall be made to the Representatives for the respective accounts of the several
Underwriters against payment by the several Underwriters through the
Representatives of the purchase price thereof to or upon the order of the
Company by wire transfer payable in same-day funds to an account specified by
the Company. Delivery of the Underwritten Securities and the Option Securities
shall be made through the facilities of The Depository Trust Company unless the
Representatives shall otherwise instruct.
If the option provided for in Section 2(b) hereof is exercised after the
third Business Day prior to the Closing Date, the Company will deliver the
Option Securities (at the expense of the Company) to the Representatives, at ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ on the date specified by the Representatives
(which shall be within three Business Days after exercise of said option) for
the respective accounts of the several Underwriters, against payment by the
several Underwriters through the Representatives of the purchase price thereof
to or upon the order of the Company by wire transfer payable in same-day funds
to an account specified by the Company. If settlement for the Option Securities
occurs after the Closing Date, the Company will deliver to the Representatives
on the settlement date for the Option Securities, and the obligation of the
Underwriters to purchase the Option Securities shall be conditioned upon receipt
of, supplemental opinions, certificates and letters confirming as of such date
the opinions, certificates and letters delivered on the Closing Date pursuant to
Section 6 hereof.
4. OFFERING BY UNDERWRITERS. It is understood that the several Underwriters
propose to offer the Securities for sale to the public as set forth in the
Prospectus.
5. AGREEMENTS. The Company agrees with the several Underwriters that:
(a) The Company will use its best efforts to cause the Registration
Statement, if not effective at the Execution Time, and any amendment
thereof, to become effective. Prior to the termination of the offering of
the Securities, the Company will not file any amendment of the Registration
Statement or supplement to the Prospectus or any Rule 462(b) Registration
Statement unless the Company has furnished you a copy for your review prior
to filing and will not file any such proposed amendment or supplement to
which you reasonably object. Subject to the foregoing sentence, if the
Registration Statement has become or becomes effective pursuant to Rule
430A, or filing of the Prospectus is otherwise required under Rule 424(b),
the Company will cause the Prospectus, properly completed, and any
supplement thereto to be filed with the Commission pursuant to the
applicable paragraph of Rule 424(b) within the time period prescribed and
will provide evidence satisfactory to the Representatives of such timely
filing. The Company will promptly advise the Representatives (1) when the
Registration Statement, if not effective at the Execution Time, shall have
become effective,
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(2) when the Prospectus, and any supplement thereto, shall have been filed
(if required) with the Commission pursuant to Rule 424(b) or when any Rule
462(b) Registration Statement shall have been filed with the Commission,
(3) when, prior to termination of the offering of the Securities, any
amendment to the Registration Statement shall have been filed or become
effective, (4) of any request by the Commission or its staff for any
amendment of the Registration Statement, or any Rule 462(b) Registration
Statement, or for any supplement to the Prospectus or for any additional
information, (5) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceeding for that purpose and (6) of
the receipt by the Company of any notification with respect to the
suspension of the qualification of the Securities for sale in any
jurisdiction or the institution or threatening of any proceeding for such
purpose. The Company will use its best efforts to prevent the issuance of
any such stop order or the suspension of any such qualification and, if
issued, to obtain as soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Securities is
required to be delivered under the Act, any event occurs as a result of
which the Prospectus as then supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary
to make the statements therein in the light of the circumstances under
which they were made not misleading, or if it shall be necessary to amend
the Registration Statement or supplement the Prospectus to comply with the
Act or the rules thereunder, the Company promptly will (1) notify the
Representatives of any such event; (2) prepare and file with the
Commission, subject to the second sentence of paragraph (a) of this Section
5, an amendment or supplement which will correct such statement or omission
or effect such compliance; and (3) supply any supplemented Prospectus to
you in such quantities as you may reasonably request.
(c) As soon as practicable, the Company will make generally available
to its security holders and to the Representatives an earnings statement or
statements of the Company which will satisfy the provisions of Section
11(a) of the Act and Rule 158 under the Act.
(d) The Company will furnish to the Representatives and counsel for
the Underwriters signed copies of the Registration Statement (including
exhibits thereto) and to each other Underwriter a copy of the Registration
Statement (without exhibits thereto) and, so long as delivery of a
prospectus by an Underwriter or dealer may be required by the Act, as many
copies of each Preliminary Prospectus and the Prospectus and any supplement
thereto as the Representatives may reasonably request.
(e) The Company will arrange, if necessary, for the qualification of
the Securities for sale under the laws of such jurisdictions as the
Representatives may designate and will maintain such qualifications in
effect so long as required for the distribution of the Securities; provided
that in no event shall the Company be obligated to qualify to do business
in any jurisdiction where it is not now so qualified or to take any action
that would subject it to service of process in suits, other than those
arising out of the offering or sale of the Securities, in any jurisdiction
where it is not now so subject.
11
(f) The Company will not, without the prior written consent of ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ Inc., offer, sell, contract to sell, pledge, or otherwise
dispose of, (or enter into any transaction which is designed to, or might
reasonably be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash settlement or
otherwise) by the Company or any affiliate of the Company or any person in
privity with the Company or any affiliate of the Company) directly or
indirectly, including the filing (or participation in the filing) of a
registration statement with the Commission in respect of, or establish or
increase a put equivalent position or liquidate or decrease a call
equivalent position within the meaning of Section 16 of the Exchange Act,
any other shares of Common Stock or any securities convertible into, or
exercisable, or exchangeable for, shares of Common Stock; or publicly
announce an intention to effect any such transaction for a period of 180
days following the Execution Time, PROVIDED, HOWEVER, that the Company may
grant options and issue and sell Common Stock pursuant to any employee
stock option plan, stock ownership plan or dividend reinvestment plan of
the Company in effect at the Execution Time provided that it is consistent
with the description of such plans in the Prospectus and the Company may
issue Common Stock issuable upon the conversion of securities or the
exercise of warrants outstanding at the Execution Time.
(g) The Company will not take, directly or indirectly, any action
designed to or which has constituted or which might reasonably be expected
to cause or result, under the Exchange Act or otherwise, in stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities.
(h) The Company agrees to pay the costs and expenses relating to the
following matters: (i) the preparation, printing or reproduction and filing
with the Commission of the Registration Statement (including financial
statements and exhibits thereto), each Preliminary Prospectus, the
Prospectus, and each amendment or supplement to any of them; (ii) the
printing (or reproduction) and delivery (including postage, air freight
charges and charges for counting and packaging) of such copies of the
Registration Statement, each Preliminary Prospectus, the Prospectus, and
all amendments or supplements to any of them, as may, in each case, be
reasonably requested for use in connection with the offering and sale of
the Securities; (iii) the preparation, printing, authentication, issuance
and delivery of certificates for the Securities, including any stamp or
transfer taxes in connection with the original issuance and sale of the
Securities; (iv) the printing (or reproduction) and delivery of this
Agreement, any blue sky memorandum and all other agreements or documents
printed (or reproduced) and delivered in connection with the offering of
the Securities; (v) the registration of the Securities under the Exchange
Act and the listing of the Securities on the Nasdaq National Market; (vi)
any registration or qualification of the Securities for offer and sale
under the securities or blue sky laws of the several states (including
filing fees and the reasonable fees and expenses of counsel for the
Underwriters relating to such registration and qualification); (vii) any
filings required to be made with the National Association of Securities
Dealers, Inc. (including filing fees and the reasonable fees and expenses
of counsel for the Underwriters relating to such filings); (viii) the
transportation and other expenses reasonably incurred by or on behalf of
Company representatives in connection with presentations to prospective
purchasers of the Securities; (ix) the fees and expenses of the Company's
12
accountants and the fees and expenses of counsel (including local and
special counsel) for the Company; and (x) all other costs and expenses
incident to the performance by the Company of its obligations hereunder. It
is understood, however, that except as otherwise provided in this
Agreement, the Underwriters shall pay all of their own costs and expenses,
including the fees of their counsel, stock transfer taxes on the resale of
any of the securities owned by them and any advertising expenses connected
with any offers they may make.
(i) In connection with the Directed Share Program, the Company will
ensure that the Directed Shares will be restricted to the extent required
by the National Association of Securities Dealers, Inc. (the "NASD") or the
NASD rules from sale, transfer, assignment, pledge or hypothecation for a
period of three months following the date of the effectiveness of the
Registration Statement. ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. will notify the Company
as to which Participants will need to be so restricted. The Company will
direct the removal of such transfer restrictions upon the expiration of
such period of time.
(j) The Company will pay all reasonable fees and disbursements of
counsel incurred by the Underwriters in connection with the Directed Share
Program and stamp duties, similar taxes or duties or other taxes, if any,
incurred by the Underwriters in connection with the Directed Share Program.
Furthermore, the Company covenants with ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. that the
Company will comply with all applicable securities and other applicable laws,
rules and regulations in each foreign jurisdiction in which the Directed Shares
are offered in connection with the Directed Share Program.
6. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITERS. The obligations of
the Underwriters to purchase the Underwritten Securities and the Option
Securities, as the case may be, shall be subject to the accuracy of the
representations and warranties on the part of the Company contained herein as of
the Execution Time, the Closing Date and any settlement date pursuant to Section
3 hereof, to the accuracy of the statements of the Company made in any
certificates pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder and to the following additional conditions:
(a) If the Registration Statement has not become effective prior to
the Execution Time, unless the Representatives agree in writing to a later
time, the Registration Statement will become effective not later than (i)
6:00 PM New York City time on the date of determination of the public
offering price, if such determination occurred at or prior to 3:00 PM New
York City time on such date or (ii) 9:30 AM on the Business Day following
the day on which the public offering price was determined, if such
determination occurred after 3:00 PM New York City time on such date; if
filing of the Prospectus, or any supplement thereto, is required pursuant
to Rule 424(b), the Prospectus, and any such supplement, will be filed in
the manner and within the time period required by Rule 424(b); and no stop
order suspending the effectiveness of the Registration Statement shall have
been issued and no proceedings for that purpose shall have been instituted
or threatened.
13
(b) The Company shall have requested and caused ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇,
LLP, counsel for the Company, to have furnished to the Representatives
their opinion, dated the Closing Date and addressed to the
Representatives, to the effect that:
(i) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction in which it is chartered or organized, with full
corporate power and authority to own or lease, as the case may
be, and to operate its properties and conduct its business as
described in the Prospectus, and is duly qualified to do business
as a foreign corporation and is in good standing under the laws
of each jurisdiction wherein it owns or leases properties or
conducts business and where the failure to be so qualified would
have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the
Company;
(ii) the Company's authorized equity capitalization is as
set forth in the Prospectus; the capital stock of the Company
conforms in all material respects to the description thereof
contained in the Prospectus; the outstanding shares of Common
Stock have been duly and validly authorized and issued and are
fully paid and nonassessable; the Securities have been duly and
validly authorized, and, when issued and delivered to and paid
for by the Underwriters pursuant to this Agreement, will be fully
paid and nonassessable; the Securities are duly listed, and
admitted and authorized for trading, subject to official notice
of issuance and evidence of satisfactory distribution, on the
Nasdaq National Market; the certificates for the Securities are
in valid and sufficient form; the holders of outstanding shares
of capital stock of the Company are not entitled to preemptive or
other rights to subscribe for the Securities; and, except as set
forth in the Prospectus, no options, warrants or other rights to
purchase, agreements or other obligations to issue, or rights to
convert any obligations into or exchange any securities for,
shares of capital stock of or ownership interests in the Company
are outstanding;
(iii) to the knowledge of such counsel, there is no pending
or threatened action, suit or proceeding by or before any court
or governmental agency, authority or body or any arbitrator
involving the Company or its property of a character required to
be disclosed in the Registration Statement which is not
adequately disclosed in the Prospectus, and there is no
franchise, contract or other document known to such counsel of a
character required to be described in the Registration Statement
or Prospectus, or to be filed as an exhibit thereto, which is not
described or filed as required; and the statements contained in
the Prospectus under the captions "Risk Factors--Any failure to
protect our intellectual property could seriously impair our
competitive position", "Risk Factors--Government regulation may
impair our ability to market our product", "Risk
Factors--Provisions of Delaware law and of our charter and
by-laws may inhibit a takeover that stockholders consider
favorable", "Business--Our Strategy--Protect our intellectual
property", "Business--Our Competitive Advantages--Technological
leader", , "Business--Intellectual Property",
"Business--Government Regulation", "Business--Legal Proceedings",
"Certain Relationships and Related Transactions-Agreement with GE
Corporate Research and Development", "Certain Relationships and
Related Transactions--DQE Enterprises Distribution Agreement",
"Certain
14
Relationships and Related Transactions--Licenses with SatCon",
"Certain Relationships and Related Transactions--Consulting
Agreements", "Description of Capital Stock" and "Shares Eligible
for Future Sale", insofar as such statements summarize legal
matters, agreements, documents, or proceedings discussed therein,
are accurate and fair summaries in all material respects of such
legal matters, agreements, documents or proceedings;
(iv) the Registration Statement has become effective under
the Act; any required filing of the Prospectus, and any
supplements thereto, pursuant to Rule 424(b) has been made in the
manner and within the time period required by Rule 424(b); to the
knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued, no
proceedings for that purpose have been instituted or threatened
and the Registration Statement and the Prospectus (other than the
financial statements and other financial information contained
therein, as to which such counsel need express no opinion) comply
as to form in all material respects with the applicable
requirements of the Act and the rules thereunder; and such
counsel has no reason to believe that on the Effective Date or
the date the Registration Statement was last deemed effective the
Registration Statement contained any untrue statement of a
material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements therein not
misleading or that the Prospectus as of its date and on the
Closing Date included or includes 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 (in each
case, other than the financial statements, statistical
information and other financial information contained therein, as
to which such counsel need express no opinion);
(v) this Agreement has been duly authorized, executed and
delivered by the Company;
(vi) The Company is not and, after giving effect to the
offering and sale of the Securities and the application of the
proceeds thereof as described in the Prospectus, will not be, an
"investment company" as defined in the Investment Company Act of
1940, as amended;
(vii) no consent, approval, authorization, filing with or
order of any court or governmental agency or body of the State of
New York, the Commonwealth of Massachusetts or the federal
government is required in connection with the transactions
contemplated herein, except such as have been obtained under the
Act and such as may be required under the blue sky laws of any
jurisdiction in connection with the purchase and distribution of
the Securities by the Underwriters in the manner contemplated in
this Agreement and in the Prospectus and such other approvals
(specified in such opinion) as have been obtained;
(viii) neither the issue and sale of the Securities, nor the
consummation of any other of the transactions herein contemplated
nor the
15
fulfillment of the terms hereof will conflict with, result in a
breach or violation of or imposition of any lien, charge or
encumbrance upon any property or assets of the Company pursuant
to, (i) the charter or by-laws of the Company, (ii) the terms of
any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation,
condition, covenant or instrument to which the Company is a party
or bound or to which its property is subject and which is known
to us, or (iii) any statute, law, rule, regulation or any
judgment, order or decree applicable to the Company of any court,
regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the
Company or any of its properties, which violation or default
would, in the case of clauses (ii) and (iii) above, either
individually or in the aggregate with all other violations and
defaults referred to in this paragraph (viii) (if any), have a
material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not
arising from transactions in the ordinary course of business,
except as set forth in or contemplated in the Prospectus
(exclusive of any supplement thereto); and
(ix) no holders of securities of the Company have rights to
the registration of such securities under the Registration
Statement, except for such rights that have been effectively
waived for purposes of such Registration Statement.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the State
of New York , the Commonwealth of Massachusetts or the Federal laws of the
United States, to the extent they deem proper and specified in such
opinion, upon the opinion of other counsel of good standing whom they
believe to be reliable and who are satisfactory to counsel for the
Underwriters and (B) as to matters of fact, to the extent they deem proper,
on certificates of responsible officers of the Company and public officials
and on representations and warranties in this Agreement. References to the
Prospectus in this paragraph (b) include any supplements thereto at the
Closing Date.
(c) The Company shall have requested and caused ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP,
special counsel to the Company for intellectual property matters, to
furnish to the Representatives their opinion, dated the Closing Date and
addressed to the Representatives to the effect that:
(i) there are no facts of which such counsel is aware that would
preclude the Company from having clear title to or a valid license
under the Intellectual Property referred to in the Prospectus under
the captions "Risk Factors--Any failure to protect our intellectual
property could seriously impair our competitive position",
"Business--Our Strategy-Protect our intellectual property",
"Business--Our Competitive Advantages--Technological leader",
"Business--Our Competitive Advantages--We design and test our systems
with safety in mind", and "Business--Intellectual Property"
(collectively, the "Statements");
16
(ii) except as described in the Statements, (A) we have no
knowledge of any of material rights of third parties to any
Intellectual Property described in the Statements as being owned by or
licensed to the Company, apart from the U.S. Government's rights
arising under technology product development contracts which have been
funded by the U.S. Government; (B) we have no knowledge of
infringement by third parties of any such Intellectual Property; (C)
we have no knowledge of any pending action, suit, proceeding or claim
by others challenging the rights of the Company in or to such
Intellectual Property, other than normal patent application
examination procedures; (D) we have no knowledge of any pending
action, suit, proceeding or claim by others challenging the validity
or scope of such Intellectual Property, other than normal patent
application examination procedures; (E) we have no knowledge of any
pending action, suit, proceeding or claim by others that the Company
infringes or otherwise violates any patent, trademark, copyright,
trade secret or other proprietary right of others; (F) we have no
knowledge of any patent or patent application which contains claims
that dominate any intellectual property described in the Prospectus as
being owned or licensed to the Company and that is necessary for the
conduct of its business or which interferes with the issued or pending
claims of any such Intellectual Property such that a patent
interference procedure would be brought against the Company; and (G)
we have no knowledge of any prior art that we believe will render any
patent held by the Company invalid or any patent application held by
the Company unpatentable which has not been disclosed to the U.S.
Patent and Trademark Office (the "PTO");
(iii) each of the patent applications set forth in Schedule I to
such opinion is pending in the PTO or other comparable patent and
trademark office as set forth in such Schedule I, and we are unaware
of any defects in the prosecution of any such application that would
irrevocably foreclose pursuit of the patent rights thereunder;
(iv) the Statements, insofar as such Statements summarize legal
matters, agreements, documents or proceedings discussed in the
Prospectus, are accurate and fair summaries of such legal matters,
agreements, documents or proceedings; and
(v) to such counsel's knowledge, the description set forth in the
Statements does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make such Statements not
misleading in the context in which they are made.
(d) The Representatives shall have received from Cravath, Swaine &
▇▇▇▇▇, counsel for the Underwriters, such opinion or opinions, dated the
Closing Date and addressed to the Representatives, with respect to the
issuance and sale of the Securities, the Registration Statement, the
Prospectus (together with any supplement thereto) and other related matters
as the Representatives may reasonably require, and the Company shall have
furnished to such counsel such documents as they request for the purpose of
enabling them to pass upon such matters.
17
(e) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chairman of the Board or the
President and the principal financial or accounting officer of the Company,
dated the Closing Date, to the effect that the signers of such certificate
have carefully examined the Registration Statement, the Prospectus, any
supplements to the Prospectus and this Agreement and that:
(i) the representations and warranties of the Company in this
Agreement are true and correct on and as of the Closing Date with the
same effect as if made on the Closing Date and the Company has
complied with all the agreements and satisfied all the conditions on
its part to be performed or satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to the Company's knowledge,
threatened; and
(iii) since the date of the most recent financial statements
included in the Prospectus (exclusive of any supplement thereto),
there has been no material adverse effect on the condition (financial
or otherwise), prospects, earnings, business or properties of the
Company, whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in the
Prospectus (exclusive of any supplement thereto).
(f) The Company shall have requested and caused Deloitte & Touche,
LLP, to have furnished to the Representatives, at the Execution Time and at
the Closing Date, letters, dated respectively as of the Execution Time and
as of the Closing Date, in form and substance satisfactory to the
Representatives, confirming that they are independent accountants within
the meaning of the Act and the applicable rules and regulations adopted by
the Commission thereunder and that they have performed a review of the
unaudited interim financial information of the Company for the nine-month
period ended September 30, 2000, and as at September 30, 1999, in
accordance with Statement on Auditing Standards No. 71 and stating in
effect that:
(i) in their opinion the audited financial statements and
financial statement schedules included in the Registration Statement
and the Prospectus and reported on by them comply as to form in all
material respects with the applicable accounting requirements of the
Act and the related rules and regulations adopted by the Commission;
(ii) on the basis of a reading of the latest unaudited financial
statements made available by the Company; their limited review, in
accordance with standards established under Statement on Auditing
Standards No. 71, of the unaudited interim financial information for
the six-month period ended June 30, 2000, and as at June 30, 1999;
carrying out certain specified procedures (but not an examination in
accordance with generally accepted auditing standards) which would not
necessarily reveal matters of significance with respect to the
comments set forth in such letter; a reading of the minutes of the
meetings of the stockholders, directors and the executive, finance,
compensation and audit committees of
18
the Company; and inquiries of certain officials of the Company who
have responsibility for financial and accounting matters of the
Company as to transactions and events subsequent to June 30, 2000,
nothing came to their attention which caused them to believe that:
(1) any unaudited financial statements included in the
Registration Statement and the Prospectus do not comply as to
form in all material respects with applicable accounting
requirements of the Act and with the related rules and
regulations adopted by the Commission with respect to
registration statements on Form S-1; and said unaudited financial
statements are not in conformity with generally accepted
accounting principles applied on a basis substantially consistent
with that of the audited financial statements included in the
Registration Statement and the Prospectus;
(2) with respect to the period subsequent to June 30, 2000,
there were any changes, at a specified date not more than five
days prior to the date of the letter, in the long-term debt of
the Company or capital stock of the Company or decreases in the
total assets or stockholders' equity of the Company or increases
in the accumulated deficit or total stockholders' deficit of the
Company as compared with the amounts shown on the June 30, 2000
consolidated balance sheet included in the Registration Statement
and the Prospectus, or for the period from July 1, 2000 to such
specified date there were any decreases, as compared with the
corresponding period in the preceding quarter, in net revenues or
income before income taxes or any increases, as compared with the
corresponding period in the preceding quarter, in loss from
operations, in total or per share amounts of net loss of the
Company, except in all instances for changes, decreases or
increases set forth in such letter, in which case the letter
shall be accompanied by an explanation by the Company as to the
significance thereof unless said explanation is not deemed
necessary by the Representatives;
(3) the information included in the Registration Statement
and Prospectus in response to Regulation S-K, Item 301 (Selected
Financial Data), Item 302 (Supplementary Financial Information)
and Item 402 (Executive Compensation) is not in conformity with
the applicable disclosure requirements of Regulation S-K; or
(4) the unaudited amounts of [capsule information] do not
agree with the amounts set forth in the unaudited financial
statements for the same periods or were not determined on a basis
substantially consistent with that of the corresponding amounts
in the audited financial statements included in the Registration
Statement and the Prospectus; and
(iii) they have performed certain other specified procedures as a
result of which they determined that certain information of an
accounting,
19
financial or statistical nature (which is limited to accounting,
financial or statistical information derived from the general
accounting records of the Company) set forth in the Registration
Statement and the Prospectus, including the information set forth
under the captions "Prospectus Summary--Summary Financial Data", "Risk
Factors", "Capitalization", "Dilution", "Selected Financial Data",
"Management's Discussion and Analysis of Financial Condition and
Results of Operations", "Business" and "Management" in the Prospectus,
agrees with the accounting records of the Company, excluding any
questions of legal interpretation.
References to the Prospectus in this paragraph (f) include any supplement
thereto at the date of the letter.
(g) Subsequent to the Execution Time or, if earlier, the dates as of
which information is given in the Registration Statement (exclusive of any
amendment thereof) and the Prospectus (exclusive of any supplement
thereto), there shall not have been (i) any change or decrease specified in
the letter or letters referred to in paragraph (f) of this Section 6 or
(ii) any change, or any development involving a prospective change, in or
affecting the condition (financial or otherwise), earnings, business or
properties of the Company, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in the
Prospectus (exclusive of any supplement thereto) the effect of which, in
any case referred to in clause (i) or (ii) above, is, in the sole judgment
of the Representatives, so material and adverse as to make it impractical
or inadvisable to proceed with the offering or delivery of the Securities
as contemplated by the Registration Statement (exclusive of any amendment
thereof) and the Prospectus (exclusive of any supplement thereto).
(h) The Securities shall have been listed and admitted and authorized
for trading on the Nasdaq National Market, and satisfactory evidence of
such actions shall have been provided to the Representatives.
(i) At the Execution Time, the Company shall have furnished to the
Representatives a letter substantially in the form of Exhibit A hereto from
each executive officer and director of the Company and certain other
stockholders listed on Schedule II hereto, addressed to the
Representatives.
(j) Prior to the Closing Date, the Company shall have furnished to the
Representatives such further information, certificates and documents as the
Representatives may reasonably request.
If any of the conditions specified in this Section 6 shall not have been
fulfilled in all material respects when and as provided in this Agreement, or if
any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and counsel for the Underwriters, this
Agreement and all obligations of the Underwriters hereunder may be canceled at,
or at any time prior to, the Closing Date by the Representatives. Notice of such
cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.
20
The documents required to be delivered by this Section 6 shall be delivered
at the office of Cravath, Swaine & ▇▇▇▇▇, counsel for the Underwriters, at
Worldwide Plaza, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, on the Closing Date.
7. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the sale of the Securities
provided for herein is not consummated because any condition to the obligations
of the Underwriters set forth in Section 6 hereof is not satisfied, because of
any termination pursuant to Section 10 hereof or because of any refusal,
inability or failure on the part of the Company to perform any agreement herein
or comply with any provision hereof, in each case, other than by reason of a
default or omission by any of the Underwriters, the Company will reimburse the
Underwriters severally through ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney on demand for all reasonable
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
that shall have been incurred by them in connection with the proposed purchase
and sale of the Securities.
8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company agrees to indemnify
and hold harmless each Underwriter, the directors, officers, employees and
agents of each Underwriter and each person who controls any Underwriter within
the meaning of either the Act or the Exchange Act against any and all losses,
claims, damages or liabilities, joint or several, 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, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of a material
fact contained in the registration statement for the registration of the
Securities as originally filed or in any amendment thereof, or in any
Preliminary Prospectus or the Prospectus, or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and agrees to reimburse
each such indemnified party, as incurred, for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action; PROVIDED, HOWEVER, that the
Company will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to
the Company by or on behalf of any Underwriter through the Representatives
specifically for inclusion therein; PROVIDED FURTHER, that with respect to any
untrue statement or omission of material fact made in any Preliminary
Prospectus, the indemnity agreement contained in this Section 8(a) shall not
inure to the benefit of any Underwriter from whom the person asserting any such
loss, claim, damage or liability purchased the securities concerned, to the
extent that any such loss, claim, damage or liability of such Underwriter occurs
under the circumstance where it shall have been determined by a court of
competent jurisdiction by final and nonappealable judgment that (w) the Company
had previously furnished copies of the Prospectus to the Representatives, (x)
delivery of the Prospectus was required by the Act to be made to such person,
(y) the untrue statement or omission of a material fact contained in the
Preliminary Prospectus was corrected in the Prospectus and (z) there was not
sent or given to such person, at or prior to the written confirmation of the
sale of such securities to such person, a copy of the Prospectus. This indemnity
agreement will be in addition to any liability which the Company may otherwise
have.
21
(b) The Company agrees to indemnify and hold harmless ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ Inc., the directors, officers, employees and agents of ▇▇▇▇▇▇▇ ▇▇▇▇▇
Barney Inc. and each person, who controls ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. within
the meaning of either the Act or the Exchange Act ("▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney
Inc. Entities"), from and against any and all losses, claims, damages and
liabilities to which they may become subject under the Act, the Exchange
Act or other Federal or state statutory law or regulation, at common law or
otherwise (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim), insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) (i) arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained
in the prospectus wrapper material prepared by or with the consent of the
Company for distribution in foreign jurisdictions in connection with the
Directed Share Program attached to the Prospectus or any preliminary
prospectus, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statement therein, when considered in conjunction
with the Prospectus or any applicable preliminary prospectus, not
misleading; (ii) are caused by the failure of any Participant to pay for
and accept delivery of the Directed Shares allocated by the Company to such
Participant; or (iii) relate to, arise out of, or occur in connection with
the Directed Share Program, provided that, in the case of clause (i), the
Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ Inc. specifically for inclusion therein and that in the case of
clause (iii) the Company will not be liable to the extent that such loss,
claim, damage or liability results from the gross negligence or willful
misconduct of ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
(c) Each Underwriter severally and not jointly agrees to indemnify and
hold harmless the Company, each of its directors, each of its officers who
signs the Registration Statement, and each person who controls the Company
within the meaning of either the Act or the Exchange Act, to the same
extent as the foregoing indemnity from the Company to each Underwriter, but
only with reference to written information relating to such Underwriter
furnished to the Company by or on behalf of such Underwriter through the
Representatives specifically for inclusion in the documents referred to in
the foregoing indemnity. This indemnity agreement will be in addition to
any liability which any Underwriter may otherwise have. The Company
acknowledges that the statements set forth in the last paragraph of the
cover page regarding delivery of the Securities and, under the heading
"Underwriting" or "Plan of Distribution", (i) the list of Underwriters and
their respective participation in the sale of the Securities, (ii) the
sentences related to concessions and reallowances and (iii) the paragraph
related to stabilization, syndicate covering transactions and penalty bids
in any Preliminary Prospectus and the Prospectus constitute the only
information furnished in writing by or on behalf of the several
Underwriters for inclusion in any Preliminary Prospectus or the Prospectus.
(d) Promptly after receipt by an indemnified party under this Section
8 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party
(i) will not relieve it from liability under paragraph (a), (b) or (c)
above unless and to the extent it did not otherwise learn of such action
and such failure results in the forfeiture by the indemnifying party of
substantial rights and defenses and
22
(ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification
obligation provided in paragraph (a), (b) or (c) above. The indemnifying
party shall be entitled to appoint counsel of the indemnifying party's
choice at the indemnifying party's expense to represent the indemnified
party in any action for which indemnification is sought (in which case the
indemnifying party shall not thereafter be responsible for the fees and
expenses of any separate counsel retained by the indemnified party or
parties except as set forth below); PROVIDED, HOWEVER, that such counsel
shall be satisfactory to the indemnified party. Notwithstanding the
indemnifying party's election to appoint counsel to represent the
indemnified party in an action, the indemnified party shall have the
right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses
of such separate counsel if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such
counsel with a conflict of interest, (ii) the actual or potential
defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there may be legal defenses
available to it and/or other indemnified parties which are different from
or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable
time after notice of the institution of such action or (iv) the
indemnifying party shall authorize the indemnified party to employ separate
counsel at the expense of the indemnifying party. An indemnifying party
will not, without the prior written consent of the indemnified parties,
settle or compromise or consent to the entry of any judgment with respect
to any pending or threatened claim, action, suit or proceeding in respect
of which indemnification or contribution may be sought hereunder (whether
or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising
out of such claim, action, suit or proceeding. An indemnifying party shall
not be liable under this Section 8 to any indemnified party regarding any
settlement or compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to
such claim or action) unless such settlement, compromise or consent is
consented to by such indemnifying party, which consent shall not be
unreasonably withheld.
(e) In the event that the indemnity provided in paragraph (a), (b) or
(c) of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and the Underwriters
severally agree to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in
connection with investigating or defending same) (collectively "Losses") to
which the Company and one or more of the Underwriters may be subject in
such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and by the Underwriters on the other from
the offering of the Securities; PROVIDED, HOWEVER, that in no case shall
any Underwriter (except as may be provided in any agreement among
underwriters relating to the offering of the Securities) be responsible for
any amount in excess of the underwriting discount or commission applicable
to the Securities purchased by such Underwriter hereunder. If the
allocation provided by the immediately preceding sentence is unavailable
for any reason, the Company and the Underwriters severally shall contribute
in such proportion as is appropriate to reflect not only such relative
benefits but also the relative fault of the
23
Company on the one hand and of the Underwriters on the other in connection
with the statements or omissions which resulted in such Losses as well as
any other relevant equitable considerations. Benefits received by the
Company shall be deemed to be equal to the total net proceeds from the
offering (before deducting expenses) received by it, and benefits received
by the Underwriters shall be deemed to be equal to the total underwriting
discounts and commissions, in each case as set forth on the cover page of
the Prospectus. Relative fault shall be determined by reference to, among
other things, whether any untrue or any alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information provided by the Company on the one hand or the
Underwriters on the other, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The Company and the Underwriters agree that
it would not be just and equitable if contribution were determined by pro
rata allocation or any other method of allocation which does not take
account of the equitable considerations referred to above. Notwithstanding
the provisions of this paragraph (e), no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 8, each person
who controls an Underwriter within the meaning of either the Act or the
Exchange Act and each director, officer, employee and agent of an
Underwriter shall have the same rights to contribution as such Underwriter,
and each person who controls the Company within the meaning of either the
Act or the Exchange Act, each officer of the Company who shall have signed
the Registration Statement and each director of the Company shall have the
same rights to contribution as the Company, subject in each case to the
applicable terms and conditions of this paragraph (e).
9. DEFAULT BY AN UNDERWRITER. If any one or more Underwriters shall fail to
purchase and pay for any of the Securities agreed to be purchased by such
Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Securities set
forth opposite their names in Schedule I hereto bears to the aggregate amount of
Securities set forth opposite the names of all the remaining Underwriters) the
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase; PROVIDED, HOWEVER, that in the event that the aggregate amount of
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Securities set forth in
Schedule I hereto, the remaining Underwriters shall have the right to purchase
all, but shall not be under any obligation to purchase any, of the Securities,
and if such nondefaulting Underwriters do not purchase all the Securities, this
Agreement will terminate without liability to any nondefaulting Underwriter or
the Company. In the event of a default by any Underwriter as set forth in this
Section 9, the Closing Date shall be postponed for such period, not exceeding
five Business Days, as the Representatives shall determine in order that the
required changes in the Registration Statement and the Prospectus or in any
other documents or arrangements may be effected. Nothing contained in this
Agreement shall relieve any defaulting Underwriter of its liability, if any, to
the Company and any nondefaulting Underwriter for damages occasioned by its
default hereunder.
10. TERMINATION. This Agreement shall be subject to termination in the
absolute discretion of the Representatives, by notice given to the Company prior
to delivery of and payment for the Securities, if at any time prior to such time
(i) trading in
24
the Company's Common Stock shall have been suspended by the Commission or the
Nasdaq National Market or trading in securities generally on the New York Stock
Exchange or Nasdaq National Market shall have been suspended or limited or
minimum prices shall have been established on such Exchange or Market, (ii) a
banking moratorium shall have been declared either by Federal or New York State
authorities or (iii) there shall have occurred any outbreak or escalation of
hostilities, declaration by the United States of a national emergency or war, or
other calamity or crisis the effect of which on financial markets is such as to
make it, in the sole judgment of the Representatives, impractical or inadvisable
to proceed with the offering or delivery of the Securities as contemplated by
the Prospectus (exclusive of any supplement thereto).
11. REPRESENTATIONS AND INDEMNITIES TO SURVIVE. The respective agreements,
representations, warranties, indemnities and other statements of the Company or
its officers and of the Underwriters set forth in or made pursuant to this
Agreement will remain in full force and effect, regardless of any investigation
made by or on behalf of any Underwriter or the Company or any of the officers,
directors, employees, agents or controlling persons referred to in Section 8
hereof, and will survive delivery of and payment for the Securities. The
provisions of Sections 7 and 8 hereof shall survive the termination or
cancellation of this Agreement.
12. NOTICES. All communications hereunder will be in writing and effective
only on receipt, and, if sent to the Representatives, will be mailed, delivered
or telefaxed to the ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. General Counsel (fax no.: (212)
▇▇▇-▇▇▇▇) and confirmed to the General Counsel, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., at
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇, Attention: General Counsel; or,
if sent to the Company, will be mailed, delivered or telefaxed to Beacon Power
Corporation (fax no.: (▇▇▇) ▇▇▇-▇▇▇▇) and confirmed to it at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, attention of the Chief Executive Officer.
13. SUCCESSORS. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers,
directors, employees, agents and controlling persons referred to in Section 8
hereof, and no other person will have any right or obligation hereunder.
14. APPLICABLE LAW. This Agreement will be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed within the State of New York.
15. COUNTERPARTS. This Agreement may be signed in one or more counterparts,
each of which shall constitute an original and all of which together shall
constitute one and the same agreement.
16. HEADINGS. The section headings used herein are for convenience only and
shall not affect the construction hereof.
17. DEFINITIONS. The terms which follow, when used in this Agreement, shall
have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder.
25
"Business Day" shall mean any day other than a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust companies are
authorized or obligated by law to close in New York City.
"Commission" shall mean the Securities and Exchange Commission.
"Effective Date" shall mean each date and time that the Registration
Statement, any post-effective amendment or amendments thereto and any Rule
462(b) Registration Statement became or become effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission promulgated thereunder.
"Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto.
"Preliminary Prospectus" shall mean any preliminary prospectus referred to
in paragraph 1(a) above and any preliminary prospectus included in the
Registration Statement at the Effective Date that omits Rule 430A Information.
"Prospectus" shall mean the prospectus relating to the Securities that is
first filed pursuant to Rule 424(b) after the Execution Time or, if no filing
pursuant to Rule 424(b) is required, shall mean the form of final prospectus
relating to the Securities included in the Registration Statement at the
Effective Date.
"Registration Statement" shall mean the registration statement referred to
in paragraph 1(a) above, including exhibits and financial statements, as amended
at the Execution Time (or, if not effective at the Execution Time, in the form
in which it shall become effective) and, in the event any post-effective
amendment thereto or any Rule 462(b) Registration Statement becomes effective
prior to the Closing Date, shall also mean such registration statement as so
amended or such Rule 462(b) Registration Statement, as the case may be. Such
term shall include any Rule 430A Information deemed to be included therein at
the Effective Date as provided by Rule 430A.
"Rule 424", "Rule 430A" and "Rule 462" refer to such rules under the Act.
"Rule 430A Information" shall mean information with respect to the
Securities and the offering thereof permitted to be omitted from the
Registration Statement when it becomes effective pursuant to Rule 430A.
"Rule 462(b) Registration Statement" shall mean a registration statement
and any amendments thereto filed pursuant to Rule 462(b) relating to the
offering covered by the registration statement referred to in Section 1(a)
hereof.
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicate hereof, whereupon this
letter and your acceptance shall represent a binding agreement among the Company
and the several Underwriters.
26
Very truly yours,
Beacon Power Corporation
By:
...............................
Name:
Title:
27
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
By:
................................................
Name:
Title:
For itself and the other
several Underwriters named
in Schedule I to the
foregoing Agreement.
SCHEDULE I
UNDERWRITERS NUMBER OF UNDERWRITTEN
SECURITIES TO BE
PURCHASED
----------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc............................. $
Banc of America Securities LLC....................... $
CIBC World Markets Corp.............................. $
----------
Total................................................ $
==========
SCHEDULE II
List of Major Stockholders
SatCon Technology Corporation
Perseus Capital, L.L.C.
DQE Enterprises, Inc.
Mechanical Technology, Incorporated
GE Capital Equity Investments, Inc.
Micro-Generation Technology Fund, L.L.C.
The Beacon Group Energy Investment Fund II, L.P.
Penske Company LLC
SCHEDULE III
DIRECTED SHARE PROGRAM
[Form of Lock-Up Agreement] EXHIBIT A
[LETTERHEAD OF OFFICER, DIRECTOR OR MAJOR SHAREHOLDER OF
BEACON POWER CORPORATION]
BEACON POWER CORPORATION
PUBLIC OFFERING OF COMMON STOCK
, 2000
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
Banc of America Securities LLC
CIBC World Markets Corp.
As Representatives of the several Underwriters,
c/o ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
This letter is being delivered to you in connection with the proposed
Underwriting Agreement (the "Underwriting Agreement"), between Beacon Power
Corporation, a Delaware corporation (the "Company"), and each of you as
representatives of a group of Underwriters named therein, relating to an
underwritten public offering of Common Stock, $0.01 par value (the "Common
Stock"), of the Company.
In order to induce you and the other Underwriters to enter into the
Underwriting Agreement, the undersigned will not, without the prior written
consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., offer, sell, contract to sell, pledge or
otherwise dispose of, (or enter into any transaction which is designed to, or
might reasonably be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash settlement or
otherwise, but excluding the exercise of any net issuance provision in any
warrant or similar security) by the undersigned or any affiliate of the
undersigned or any person in privity with the undersigned or any affiliate of
the undersigned), directly or indirectly, including the filing (or participation
in the filing) of a registration statement with the Securities and Exchange
Commission in respect of, or establish or increase a put equivalent position or
liquidate or decrease a call equivalent position within the meaning of Section
16 of the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Securities and Exchange Commission promulgated thereunder
with respect to, any shares of capital stock of the Company or any securities
convertible into, or exercisable or exchangeable for such capital stock, or
publicly announce an intention to effect any such transaction, for a period of
180 days after the effective date of the registration statement relating to the
underwritten public offering of Common Stock, other than shares of Common Stock
disposed of as bona fide gifts approved by ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
The undersigned is executing and delivering this letter upon the express
understanding that each one percent (1%) holder of Common Stock, officer and
director has executed and delivered to ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. a letter
substantially similar to this letter. If such understanding is incorrect, this
letter shall immediately become null and void. If such a lock-up letter is
released with respect to some or all of its Common Stock,
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. will release the undersigned's shares from the lock-up
provisions set forth herein.
The undersigned shall, however, be entitled to (i) transfer the Common
Stock or securities convertible into or exchangeable or exercisable for any
Common Stock to an affiliate of the undersigned, provided however, that any such
transferee agrees to be bound by the terms of this letter and to enter into a
similar agreement with ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. on its own behalf, (ii) sell
any Common Stock purchased in the open market by the undersigned following
consummation of the initial public offering, (iii) sell any Common Stock to a
third party in a transaction that is exempt from the registration requirements
of the Securities Act of 1933, as amended, provided however, that any such
purchaser agrees to be bound by the terms of this letter and to enter into a
similar agreement with ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. on its own behalf, (iv)
maintain its existing pledge of the Common Stock, provided however, that the
undersigned shall not deliver certificates representing the pledged shares of
Common Stock to the pledgee unless such pledgee agrees in writing not to sell,
transfer or dispose of such Common Stock during the period of time covered by
this letter, and (v) enter into a new pledge of the Common Stock to secure a
bona fide loan for borrowed money, provided that the pledgee agrees in writing
to be bound by the terms of this letter (it being understood that the pledgee's
agreement need only relate to the shares covered by the pledge and transactions
relating thereto).
If for any reason the Underwriting Agreement shall be terminated prior to
the Closing Date (as defined in the Underwriting Agreement), the agreement set
forth above shall likewise be terminated. In any event, this agreement shall
terminate and be of no further force and effect if the closing of the offering
has not occurred by March 31, 2001.
This letter shall be governed by and construed in accordance with the laws
of the State of New York without regard to principles of conflict of laws.
Yours very truly,
[SIGNATURE OF OFFICER, DIRECTOR OR MAJOR
STOCKHOLDER]
[NAME AND ADDRESS OF OFFICER, DIRECTOR
OR MAJOR STOCKHOLDER]