POWER-ONE, INC.
6,500,000 SHARES*
COMMON STOCK
($0.001 PAR VALUE)
UNDERWRITING AGREEMENT
September ___, 1999
▇▇▇▇▇▇▇▇ INC., BANCBOSTON ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ INC.
AND ▇▇▇▇▇▇ ▇▇▇▇▇▇ PARTNERS LLC
As Representatives of the several
Underwriters named in Schedule II hereto.
c/o Stephens Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Gentlemen:
Power-One, Inc., a Delaware corporation (the "Company"), and the
individuals whose names appear on Schedule I hereto, designated as selling
stockholders (collectively, the "Selling Stockholders"), severally and not
jointly, confirm their agreement with the several underwriters (the
"Underwriters") for whom you are acting as representatives (the
"Representatives") as follows:
The Company proposes to issue and sell 4,000,000 shares of its
authorized and unissued shares of common stock, par value $0.001 per share,
to the several Underwriters (the "Company Shares"), and the Selling
Stockholders, acting severally and not jointly, propose to sell an aggregate
of 2,500,000 shares of the authorized and outstanding shares of the Company's
common stock, par value $0.001 per share, to the several Underwriters (the
"Selling Stockholders Shares"). The Company Shares and the Selling
Stockholders Shares are hereinafter collectively referred to as the
"Underwritten Shares." The Company and the Selling Stockholders are
sometimes referred to collectively herein as "Sellers." The respective
amounts of Underwritten Shares to be initially sold by each of the Sellers is
set forth on Schedule I attached hereto. The Company's common stock is more
fully described in the Registration Statement and the Prospectus hereinafter
mentioned.
For the sole purpose of covering over-allotments in connection with the
sale of the Underwritten Shares, the Company shall grant to the Underwriters
the option (the "Option") described in Section 2 hereof to purchase all or
any part of an additional 975,000 shares of the Company's common stock (the
"Option Shares"). The Underwritten Shares and the Option Shares purchased
pursuant to this Underwriting Agreement (this "Agreement") are herein called
the "Shares" and the proposed offering of the Shares by the Underwriters is
hereinafter referred to as the "Public Offering."
The Company has filed with the Securities and Exchange Commission (the
"Commission"), pursuant to the Securities Act of 1933, as amended (the "Act"),
and published rules and regulations adopted
-----------------------
*Plus up to 975,000 additional shares of common stock to cover over-allotments.
by the Commission under the Act (the "Rules"), a registration statement on
Form S-3 ("Form S-3") (File No. 333-84285), including a Preliminary
Prospectus, relating to the Shares, and such amendments to such registration
statement as may have been filed with the Commission to the date of this
Agreement. The Company will also file with the Commission one of the
following: (A) prior to effectiveness of such registration statement, a
further amendment to such registration statement, including the form of final
prospectus, and/or (B) after effectiveness of such registration statement, a
final prospectus in accordance with Rules 430A and 424(b). The Company has
furnished to the Representatives copies of such registration statement, each
amendment to it filed by the Company with the Commission, and each
Preliminary Prospectus filed by the Company with the Commission. The
registration statement as amended at the time it becomes or became effective
(the "Effective Date"), including financial statements and all exhibits and
any information deemed to be included by Rule 430A, is called the
"Registration Statement." The term "Preliminary Prospectus" means any
Preliminary Prospectus (as referred to in Rule 430 or Rule 430A of the Rules)
included at any time as a part of the registration statement and the term
"Prospectus" means the prospectus relating to the Shares that is first filed
pursuant to Rule 424(b) after the date hereof.
Any reference herein to the Registration Statement, any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and include any
documents incorporated by reference therein on or before the Effective Date
or the date of such Preliminary Prospectus or the Prospectus, as the case may
be (the "Incorporated Documents"), and shall be deemed to refer to and
include any documents incorporated by reference therein filed after the date
of such Registration Statement, any Preliminary Prospectus or the Prospectus.
As the Representatives, you have advised the Company that (a) you are
authorized to enter into this Agreement on behalf of the several Underwriters
and (b) the Underwriters are willing, acting severally and not jointly, to
purchase the amounts of the Underwritten Shares set forth opposite their
respective names in Schedule II hereto, plus their pro rata portion of the
Option Shares if you elect to exercise the over-allotment Option in whole or
in part for the accounts of the several Underwriters.
In consideration of the mutual agreements contained herein and of the
interests of the parties in the transactions contemplated hereby, the
Company, the Selling Stockholders and the Underwriters hereby agree as
follows:
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS
(a) The Company represents and warrants to, and agrees with, each
Underwriter as follows:
(i) The Company has been duly organized, is in compliance
with its Certificate of Incorporation, and is validly existing as a
corporation in good standing under the laws of the State of Delaware,
with full corporate power and authority to own its properties and
conduct its business as described in the Prospectus. Each significant
subsidiary (as defined by the Act) of the Company (each a "Subsidiary"
and collectively, the "Subsidiaries") has been duly incorporated and
is validly existing as a corporation, in good standing under the laws
of the jurisdiction of its organization, with full corporate power and
authority to own or lease its properties, and conduct its business.
The Company and the Subsidiaries are duly qualified to transact
business in all jurisdictions in which the conduct of their business
or the ownership or lease of their properties requires such
qualifications except where the failure to be so qualified would not
reasonably be expected to have a Material Adverse Effect (as defined
below). The Company owns all of the outstanding capital stock of its
Subsidiaries free and clear of any pledge, lien, security interest,
encumbrance, claim or equitable interest (except for (A) shares owned
by others
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and held in trust for the Company in accordance with the
laws of the country of incorporation and (B) a pledge of 65% of the
issued and outstanding capital stock of each of Power Electronics,
Inc., Poder Uno de Mexico, S.A., de C.V. and ▇▇▇▇▇▇▇ Holding AG made
by the Company in favor of Bank of America N.A., pursuant to that
certain second Amended and Restated Credit Agreement among the
Company, certain subsidiaries of the Company, certain lenders and Bank
of America, N.A. as Administrative Agent and Union Bank of California,
N.A. as Co-Agent).
(ii) The outstanding shares of common stock of the Company,
including the Selling Stockholders Shares, have been duly and validly
authorized and issued and are fully paid and non-assessable; the
Shares are duly and validly authorized, and, if not now issued, when
issued and paid for as contemplated herein, will be fully paid and
non-assessable. There are no preemptive or other similar rights to
subscribe for or to purchase, or any restriction upon the voting or
transfer of the Shares pursuant to the Company's Certificate of
Incorporation, bylaws, or other governing documents or any agreement
or other instrument to which the Company or any of its Subsidiaries is
a party or by which any of them may be bound. Neither the filing of
the Registration Statement nor the offering of the Shares as
contemplated by this Agreement gives rise to any rights, other than
those which have been waived or satisfied, for or relating to the
registration of any shares of any class of the Company's capital
stock. The Company Shares have been approved for listing on the
Nasdaq National Market, subject to official notice of issuance.
(iii) The Shares conform in all material respects with the
statements concerning them in the Prospectus. As of the Closing Date
(as defined below) and any Option Closing Date (as defined below), if
applicable, the Company will have the authorized capital stock set
forth under the caption "Description of Capital Stock" in the
Prospectus. No further corporate approval or authority on behalf of
the Company will be required for the issuance and sale of the Shares
to be sold by the Company as contemplated herein.
(iv) Any Preliminary Prospectus, the Prospectus and the
Registration Statement comply as to form with the requirements of the
Act and the Rules, including Form S-3. The Company meets the
requirements of, and is entitled to use, Form S-3 for the Public
Offering.
(v) Neither the Commission nor any other agency, body,
authority, court or arbitrator of competent jurisdiction has, by order
or otherwise, prohibited or suspended the use of any Preliminary
Prospectus or the Prospectus relating to the proposed offering of the
Shares or, to the Company's knowledge, instituted proceedings for that
purpose. The Registration Statement, the Prospectus and any
amendments or supplements thereto at the time they became or become
effective or were filed or are filed with the Commission contained or
will contain all statements which are required to be stated therein
by, and in all material respects conformed or will conform to the
requirements of, the Act and the Rules. Neither the Registration
Statement nor any any amendment thereto, and neither the Prospectus
nor any supplement thereto, as of its date and while effective,
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, in light of the circumstances under which they
were made, not misleading; PROVIDED, HOWEVER, that the Company does
not make any representations or warranties as to information contained
in or omitted from the Registration Statement or the Prospectus, or
any such amendment or supplement, in reliance upon, and in conformity
with, written information furnished to the Company by or
3
on behalf of any Underwriter through the Representatives, expressly
for use in the preparation thereof as hereinafter set forth in
Section 14.
(vi) The documents which are incorporated by reference in the
Registration Statement, any Preliminary Prospectus or the Prospectus
or from which information is so incorporated by reference, when they
were filed (or, if any amendment with respect to such document was
filed, when such amendment was filed) with the Commission complied in
all material respects with the requirements of the Exchange Act, and
the rules and regulations thereunder and any documents so filed and
incorporated by reference subsequent to the Effective Date shall, when
they are so filed with the Commission, conform in all material
respects with the requirements of the Exchange Act and the rules and
regulations thereunder.
(vii) The consolidated financial statements of the Company and
the Subsidiaries, together with related notes and schedules, as set
forth or incorporated by reference in the Registration Statement,
present fairly the consolidated financial condition and the results of
operations of the Company and the Subsidiaries, at the indicated dates
and for the indicated periods. Such financial statements have been
prepared in accordance with generally accepted accounting principles
("GAAP"), consistently applied throughout the periods involved, and
all adjustments necessary for a fair presentation of results for such
periods have been made. The summary financial information and the
selected financial data included in the Prospectus present fairly in
accordance with GAAP (other than the "EBITDA," "EBITDA margin" and
"backlog" information) the information shown therein and have been
compiled on a basis consistent with that of the audited and unaudited
financial statements from which they were derived.
(viii) Except as is disclosed in the Prospectus, there is no
action or proceeding pending or, to the knowledge of the Company,
threatened against the Company, any of its Subsidiaries or any of
their respective officers or any of their properties, assets or rights
before any court or administrative or governmental agency or other
body which reasonably would be expected to (A) result in any material
adverse change in the financial condition, or in the earnings,
business, affairs, properties, business prospects or results of
operations of the Company and its Subsidiaries taken as a whole
("Material Adverse Change" or "Material Adverse Effect," as the case
may be), whether or not arising in the ordinary course of business,
(B) adversely affect the performance of this Agreement or the
consummation of the transactions herein contemplated, except as
disclosed in the Prospectus and for which the Company maintains a
reserve in an amount which it believes is adequate to cover potential
liabilities, or (C) be required to be disclosed in the Registration
Statement.
(ix) The Company and each of its Subsidiaries are not in
violation of any law, ordinance, governmental rule or regulation or
court decree to which they may be subject which violation reasonably
would be expected to have a Material Adverse Effect.
(x) The Company and its Subsidiaries have (A) to the best of
the Company's knowledge, good and marketable title to all of the real
properties and (B) valid title to all other assets reflected in the
consolidated financial statements hereinabove described or as
described in the Prospectus as being owned by them, subject to no
lien, mortgage, pledge, charge or encumbrance of any kind except those
securing indebtedness described in such financial statements or as
described in the Prospectus or which do not materially affect the
present or proposed use of such properties or assets or would not
cause a Material Adverse
4
Effect. The Company and its Subsidiaries occupy their leased
properties under valid, subsisting and binding leases with only
such exceptions as in the aggregate are not material and do not
interfere with the conduct of the business of the Company and its
Subsidiaries. There exists no default by the Company, or to the
Company's knowledge, of any other party, under the provisions of
any lease, contract or other obligation to which the Company is a
party which may result in a Material Adverse Change.
(xi) The Company and its Subsidiaries have filed all federal,
state and other tax returns and reports which have been required to be
filed and have paid all taxes indicated by said returns and all
assessments received by them to the extent that such taxes have become
due and there is no tax deficiency that has been or, to the Company's
knowledge, might be asserted against the Company or any of its
Subsidiaries that might have a Material Adverse Effect. All material
tax liabilities are adequately provided for on the books of the
Company and its Subsidiaries.
(xii) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, as they may be
amended or supplemented, and except as set forth in the Registration
Statement, (A) there has not been any Material Adverse Change nor, to
the knowledge of the Company, is any such change threatened, (B) there
has not been any transaction entered into by the Company or its
Subsidiaries that is material to the earnings, business, affairs,
properties, business prospects or operations of the Company and its
Subsidiaries taken as a whole, other than transactions in the ordinary
course of business and changes and transactions contemplated by the
Registration Statement and the Prospectus, as they may be amended or
supplemented, (C) other than changes in the amounts outstanding under
the Company's and its Subsidiaries' revolving credit facilities, there
has not been any material change in the capital stock, long term debt
or material liabilities of the Company or its Subsidiaries, and (D)
there has not been any dividend or distribution of any kind declared,
paid or made on the capital stock of the Company. Neither the Company
nor any Subsidiary has any contingent obligations or liabilities which
are required to be but are not disclosed in the Registration Statement
and the Prospectus.
(xiii) The filing of the Registration Statement and related
Prospectus and the execution and delivery of this Agreement have been
duly authorized by the Board of Directors of the Company; this
Agreement constitutes a valid and binding obligation of the Company
enforceable in accordance with its terms except as enforceability may
be limited by bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other laws affecting creditors' rights
generally and by general principles of equity and federal and state
securities laws. Neither the Company nor any of its Subsidiaries is
in breach or violation of or default under any indenture, mortgage,
deed of trust, lease, contract, note or other agreement or instrument
to which it is a party or by which it or any of its properties is
bound and which breach, violation or default would reasonably be
expected to have a Material Adverse Effect. The consummation of the
transactions herein contemplated and the fulfillment of the terms
hereof will not result in a breach or violation of any of the material
terms and provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, lease, contract, note or other agreement or
instrument to which the Company or any Subsidiary is a party, or of
the Company's or any Subsidiary's Certificate of Incorporation or
bylaws or any law, decree, order, rule, writ, injunction or regulation
applicable to the Company or any Subsidiary of a court or of any
regulatory body or administrative agency or other governmental body
having jurisdiction over the Company
5
and its Subsidiaries except for such breaches, violations or
defaults as would not reasonably be expected to have a Material
Adverse Effect.
(xiv) Each approval, consent, order, authorization,
designation, declaration or filing by or with any regulatory,
administrative or other governmental body necessary in connection with
the execution and delivery by the Company of this Agreement and
performance of its obligations hereunder (except such additional steps
as may be necessary to qualify the Shares for public offering by the
Underwriters under state securities or Blue Sky laws, and filing the
Prospectus under Rule 424(b)) has been obtained or made and is in full
force and effect.
(xv) The Company and each Subsidiary hold all material
licenses, authorizations, charters, certificates and permits from
governmental authorities which are necessary to the conduct of their
businesses, except where the failure to hold any such licenses,
authorizations, charters, certificates or permits would not reasonably
be expected to result in a Material Adverse Effect, and neither the
Company nor any Subsidiary has received notice of any proceeding
relating to the revocation or modification of any of such licenses,
authorizations, charters, certificates or permits. The Company and
its Subsidiaries own or otherwise possess rights to the patents,
patent rights, licenses, inventions, copyrights, trademarks, service
marks and trade names presently employed by them in connection with
the businesses now operated by them as described in the Prospectus,
and neither the Company nor any of its Subsidiaries has infringed or
received any notice of infringements of or conflict with asserted
rights of others with respect to any of the foregoing, except where
such infringement or conflict would not reasonably be expected to
result in a Material Adverse Effect.
(xvi) Deloitte & Touche LLP, independent auditors, who have
certified certain of the financial statements filed with the
Commission and incorporated by reference in the Registration Statement
and Prospectus, are independent public accountants within the meaning
of the Act, the Rules and Regulation S-X of the Commission and Rule
101 of the Code of Professional Ethics of the American Institute of
Certified Public Accountants.
(xvii) There are no agreements, contracts or other documents of
a character required to be described in the Registration Statement or
the Prospectus or required by Form S-3 to be filed as exhibits to the
Registration Statement or incorporated by reference in the
Registration Statement which are not described, filed or incorporated
as required.
(xviii) No labor dispute is pending or, to the knowledge of the
Company, threatened by the Company's or any Subsidiary's employees
which could result in a Material Adverse Effect. No collective
bargaining agreement exists with any of the Company's employees and,
to the Company's knowledge, no agreement is imminent.
(xix) Except as contemplated by Section 2 hereof and as
disclosed in the Prospectus and permitted by the Rules, the Company
has not (itself or through any person) taken and will not take,
directly or indirectly, any action designed to or which might
reasonably be expected to, cause or result in a violation of Section 5
of the Act or Regulation M under the Act or in stabilization or
manipulation of the price of the Company's common stock.
(xx) Without limiting the generality of any of the foregoing
representations and warranties and except to the extent no Material
Adverse Effect would reasonably be
6
expected to occur, (a) none of the operations of the Company or its
Subsidiaries is in violation of any material environmental law,
regulation or any permit; (b) neither the Company nor any of its
Subsidiaries has been notified that it is under investigation or
under review by any governmental agency with respect to compliance
therewith or with respect to the generation, use, treatment,
storage or release of hazardous material; (c) neither the Company
nor any of its Subsidiaries have any material liability in
connection with the past generation, use, treatment, storage,
disposal or release of any hazardous material; (d) there is no
hazardous material that may reasonably be expected to pose any
material risk to safety, health, or the environment, on, under or
about any property owned, leased or operated by the Company or any
of its Subsidiaries or, to the knowledge of the Company, any
property adjacent to any such property; and (e) there has
heretofore been no release of any hazardous material on, under or
about such property, or, to the knowledge of the Company, any such
adjacent property. None of the present or, to the knowledge of the
Company, past property of the Company or any of its Subsidiaries is
listed or proposed for listing on the National Priorities List
pursuant to the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended ("CERCLA"), or on the
Comprehensive Environmental Response Compensation Liability
Information System List ("CERCLIS") or any similar state list of
sites requiring remedial action. Neither the Company nor any of
its Subsidiaries is subject to any state Environmental Property
Transfer Act, or to the extent that any such statute is applicable
to any property, the Company and its Subsidiaries have fully
complied with their obligations under such statute(s), and neither
has any outstanding obligations or liabilities under any state
Environmental Property Transfer Act.
(xxi) The Company and its Subsidiaries maintain insurance of
the types and in the amounts customary for their businesses,
including, but not limited to, insurance covering liability and real
and personal property owned or leased by the Company against theft,
damage, destruction, acts of vandalism and all other risks customarily
insured against, all of which insurance is in full force and effect.
(xxii) Neither the Company nor any Subsidiary has at any time
during the last five years (a) made any unlawful contribution to any
candidate for foreign office, or failed to disclose fully any
contribution in violation of law, or (b) made any payment to any
federal or state governmental officer or official, or other person
charged with similar public or quasi-public duties, other than
payments required or permitted by the laws of the United States or any
jurisdiction thereof.
(xxiii) Each executive officer or director of the Company who is
not a Selling Stockholder has executed a lock-up agreement, a form of
which is attached hereto as Exhibit "A" (the "Lock-Up Agreement").
(b) Each Selling Stockholder, severally and not jointly, represents
and warrants as follows:
(i) Such Selling Stockholder has duly executed and delivered
a power of attorney (individually, a "Power of Attorney" and with all
other powers of attorney, collectively the "Powers of Attorney"), in
the form heretofore delivered to the Representatives, appointing the
person named therein as such Selling Stockholder's attorney-in-fact
(the "Attorney-in-Fact") with authority to perform this Agreement on
behalf of such Selling Stockholder. Certificates in negotiable form
for the Shares to be sold by such Selling Stockholder hereunder have
been delivered to the Company's transfer
7
agent for the purpose of delivery pursuant to this Agreement. All
authorizations, orders and consents necessary for the execution and
delivery by such Selling Stockholder of this Agreement and the
Power of Attorney have been duly and validly given, and such
Selling Stockholder has full legal right, power and authority to
enter into this Agreement and the Power of Attorney and to sell,
assign, transfer and deliver to the several Underwriters the Shares
to be sold by such Selling Stockholder hereunder. Such Selling
Stockholder agrees that the Shares to be sold by such Selling
Stockholder that are represented by the certificates delivered to
the transfer agent are for the benefit of, coupled with and subject
to the interests of the Underwriters hereunder, that the
arrangements made for the appointment of the Attorney-in-Fact are
to that extent irrevocable, and that the obligations of such
Selling Stockholder hereunder shall not be terminated except as
provided in this Agreement or the Power of Attorney, by any act of
such Selling Stockholder, by operation of law or otherwise, whether
by death or incapacity or by the occurrence of any other event. If
such Selling Stockholder should die or become incapacitated or if
any other event shall occur before delivery of Shares to be sold by
such Selling Stockholder hereunder, the certificates for such
Shares delivered to the transfer agent shall be delivered by the
transfer agent in accordance with this Agreement as if such death,
incapacity or other event had not occurred, regardless of whether
the transfer agent or the Attorney-in-Fact shall have received
notice thereof.
(ii) Such Selling Stockholder will have at the Closing (as
such date is hereinafter defined) good and valid title to the portion
of the Shares to be sold by such Selling Stockholder, free of any
liens, encumbrances, equities and claims, and full right, power and
authority to effect the sale and delivery of such Shares; and upon the
delivery of and payment for such Shares pursuant to this Agreement,
good and valid title thereto, free of any liens, encumbrances,
equities and claims, will be transferred to the several Underwriters.
(iii) The consummation by such Selling Stockholder of the
transactions herein contemplated and the fulfillment of the terms
hereof will not result in a breach of any of the terms and provisions
of, or constitute a default under, any indenture, mortgage, deed of
trust or other agreement or instrument to which such Selling
Stockholder is a party, or of any order, rule or regulation applicable
to such Selling Stockholder of any court, or of any regulatory body or
administrative agency or other governmental body having jurisdiction.
(iv) Such Selling Stockholder has not taken and will not take
for a period of 180 days following the date hereof, directly or
indirectly, any action designed to, or which has constituted, or which
might reasonably be expected to cause or result in stabilization or
manipulation of the price of the common stock of the Company;
PROVIDED, HOWEVER, that activities undertaken by ▇▇▇▇▇▇▇▇ Inc. in its
capacity as a Representative of the Underwriters or as a broker-dealer
shall not be considered direct or indirect actions of any Selling
Stockholder.
(v) Such Selling Stockholder has not distributed and will not
distribute any prospectus or other offering material in connection
with the offering and sale of the Shares other than the Preliminary
Prospectus and the Prospectus or other material permitted by the Act.
(vi) All information furnished to the Company by such Selling
Stockholder or on such Selling Stockholder's behalf for use in
connection with the preparation of the Registration Statement and
Prospectus (including, without limiting the foregoing, all
8
representations and warranties of such Selling Stockholder in such
Selling Stockholder's Power of Attorney), is true and correct and does
not omit to state any material fact necessary to be stated therein in
order to make such information not misleading.
(vii) Such Selling Stockholder has no reason to believe that
the representations and warranties of the Company contained in this
Section 1 are not true and correct, is familiar with the Registration
Statement and has no knowledge of any material fact, condition or
information not disclosed in the Prospectus which has adversely
affected or may adversely affect the business of the Company or the
Subsidiaries, and the sale of the portion of the Shares to by sold by
such Selling Stockholder pursuant hereto is not prompted by any
information concerning the Company or the Subsidiaries which is not
set forth in the Prospectus.
(c) Any certificate signed by any officer of the Company and
delivered to you or counsel for the Underwriters shall be deemed a
representation and warranty by the Company to the Underwriters as to the
matters covered thereby.
2. PURCHASE, SALE AND DELIVERY OF THE UNDERWRITTEN SHARES. On the basis
of the representations, warranties and covenants herein contained, and subject
to the terms and conditions herein set forth, the Company and the Selling
Stockholders, severally and not jointly, agree to sell to each Underwriter, and
each Underwriter agrees, severally and not jointly, to purchase, at a price of
$_____ per share, the respective number of the Underwritten Shares set forth
opposite the name of the Company and each Selling Stockholder on Schedule II
attached hereto. The obligation of each Underwriter to the Company and to each
Selling Stockholder shall be to purchase from the Company or such Selling
Stockholder that number of Company Shares or Selling Stockholders Shares, as the
case may be, which (as nearly as practicable, as determined by you) is in the
same proportion to the number of Company Shares or Selling Stockholders Shares,
as the case may be, set forth opposite the name of the Company or such Selling
Stockholder in Schedule I hereto as the number of Underwritten Shares which is
set forth opposite the name of such Underwriter in Schedule II hereto (subject
to adjustment as provided as provided in Section 11 hereof) is to the total
number of Underwritten Shares to be purchased by all of the Underwriters under
this Agreement.
Payment for the Underwritten Shares shall be made by wire transfer of
immediately available U.S. Funds to designated accounts, to the order of the
Sellers, against delivery of certificates for the Shares to the Representatives
for the accounts of the several Underwriters. Delivery of certificates shall be
to the Representatives c/o Stephens Inc. ("Stephens"), ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or at such other address as Stephens may designate in
writing. Payment will be made at the offices of ▇▇▇▇▇▇▇▇, or at such other
place as shall be agreed upon by ▇▇▇▇▇▇▇▇ and the Sellers, at approximately 9:00
a.m., central time, on ____________, 1999, such time and date being herein
referred to as the "Closing Date." The certificates for the Underwritten Shares
will be delivered in such denominations and in such registrations as ▇▇▇▇▇▇▇▇
reasonably requests in writing and will be made available for inspection at such
locations as ▇▇▇▇▇▇▇▇ may reasonably request at least one full business day
prior to the Closing Date.
In addition, on the basis of the representations, warranties, agreements
and covenants herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants the Option to the several Underwriters to
purchase the Option Shares at the price per share as set forth in the first
paragraph of this Section 2. The Option may be exercised in whole or in part on
one occasion upon written notice (or oral notice, subsequently confirmed in
writing) given not more than thirty (30) days following the date of this
Agreement, by ▇▇▇▇▇▇▇▇, on behalf of the Representatives of the several
Underwriters, to the Company setting forth the number of Option Shares as to
which the several Underwriters are exercising the
9
Option and the names and denominations in which the Option Shares are to be
registered. Closing on the purchase of the Option Shares (the "Option
Closing Date"), if any, shall occur no later than three (3) business days
following the date upon which notice of exercise of the Option is given to
the Company, and shall take place at the offices of ▇▇▇▇▇▇▇▇, or at such
other place as shall be agreed upon by ▇▇▇▇▇▇▇▇ and the Company. Subject to
Section 11, the number of Option Shares to be purchased by each Underwriter
shall be in the same proportion to the total number of shares of the common
stock being purchased by such Underwriter bears to 6,500,000 shares, adjusted
by you in such manner as to avoid fractional shares. The Option may be
exercised only to cover over-allotments in the sale of the Underwritten
Shares by the Underwriters. ▇▇▇▇▇▇▇▇, on behalf of the Representatives of
the several Underwriters, may cancel such option at any time prior to its
expiration by giving written notice (or oral notice, subsequently confirmed
in writing) of such cancellation to the Company. To the extent, if any, that
the Option is exercised, payment for the Option Shares shall be made by wire
transfer of immediately available U.S. Funds to a designated account of the
Company, to the order of the Company. Certificates for the Option Shares
shall be delivered in the same manner and upon the same terms as the
Underwritten Shares.
3. QUALIFIED INDEPENDENT UNDERWRITER. The Company hereby confirms its
engagement of BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc. ("BRS"), and BRS hereby
confirms its agreement with the Company, to render services as a "qualified
independent underwriter" within the meaning of Section b(15) of Rule 2720 of the
National Association of Securities Dealers, Inc. (the "NASD") with respect to
the offering and sale of the Shares. BRS, in its capacity as qualified
independent underwriter and not otherwise, is referred to herein as the "QIU."
4. OFFERING BY THE UNDERWRITERS. It is understood that the Public
Offering of the Underwritten Shares is to be made as soon as the Representatives
deem it advisable to do so after the Registration Statement has become
effective. The Underwritten Shares are to be initially offered to the public at
the public offering price set forth in the Prospectus. The Representatives may
from time to time thereafter change the public offering price and other selling
terms. To the extent, if at all, that any Option Shares are purchased pursuant
to Section 2 hereof, the Underwriters will offer them to the public on the
foregoing terms.
It is further understood that you will act as the Representatives for the
Underwriters in the offering and sale of the Shares, in accordance with an
Agreement Among Underwriters which has been entered into by you and the several
other Underwriters.
5. COVENANTS OF THE COMPANY AND THE SELLING STOCKHOLDERS. The Company
covenants and agrees, and the Selling Stockholders covenant and agree, each for
himself and with respect only to paragraphs (j) and (l), with each of the
several Underwriters that:
(a) The Company will use its best efforts to cause the Registration
Statement to become effective and will not, either before or after
effectiveness, file any amendment thereto or supplement to the Prospectus
(including a prospectus filed pursuant to Rule 424(b) which differs from
the Prospectus on file at the time the Registration Statement becomes
effective) or file any documents under the Exchange Act before the earlier
to occur of (A) the 35th day following the Effective Date or (B) the
closing date of the Underwriters' purchase of the Option Shares if such
document would be deemed to be incorporated by reference into the
Registration Statement, the Preliminary Prospectus or the Prospectus of
which the Representatives shall not previously have been advised and
furnished with a copy or to which the Representatives shall have reasonably
objected in writing or which is not in compliance with the Act or Rules or
the Exchange Act or the rules and regulations thereunder.
10
(b) The Company will advise the Representatives promptly of any
request of the Commission or other securities regulatory agency ("Other
Securities Regulator") for amendment of the Registration Statement or for
supplement to the Prospectus or for any additional information, or of the
issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or the use of the Prospectus or of the
institution of any proceedings for that purpose, or comparable action taken
or initiated by any Other Securities Regulator, and the Company will use
its reasonable efforts to prevent the issuance of any such stop order
preventing or suspending the use of the Prospectus and to obtain as soon as
possible the lifting thereof, if issued.
(c) The Company will use its reasonable efforts with the
Representatives in endeavoring to qualify the Shares for sale under the
securities laws of such jurisdictions (including foreign jurisdictions) as
the Representatives may reasonably designate, and will make such
applications, file such documents, and furnish such information as may be
reasonably required for that purpose; PROVIDED, HOWEVER, the Company shall
not be required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction where it is not so
qualified or required to file such a consent. The Company will, from time
to time, prepare and file such statements, reports, and other documents, as
are or may be required to continue such qualifications in effect for so
long a period as the Representatives may reasonably request for
distribution of the Shares.
(d) The Company will deliver to, or upon the order of, the
Representatives, from time to time, as many copies of any Preliminary
Prospectus or the Prospectus as the Representatives may reasonably request.
The Company will deliver to, or upon the order of, the Representatives, on
the Effective Date and thereafter from time to time during the period
necessary to effect the distribution of the Shares as many copies of the
Prospectus in final form, or as thereafter amended or supplemented, as the
Representatives may reasonably request. The Company will deliver to each
of the Representatives at or before the Closing Date, one (1) manually
signed copy of the Registration Statement and all amendments thereto
including all exhibits filed therewith and will deliver to the
Representatives such number of copies of the Registration Statement, but
without exhibits, and of all amendments thereto, as the Representatives may
reasonably request.
(e) During the time necessary to effect the distribution of the
Shares, the Company shall comply with all requirements imposed upon it by
the Act, as now and hereafter amended, and by the Rules, as from time to
time in force, so far as is necessary to permit the continuance of sales of
or dealings in the Shares as contemplated by the provisions hereof and the
Prospectus. If, during the period necessary to effect the distribution of
the Shares, any event shall occur as a result of which, in the judgment of
the Company or in the opinion of counsel for the Underwriters, it becomes
necessary to amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances existing at the time
the Prospectus is delivered to a purchaser, not misleading, or, if it is
necessary at any time to amend or supplement the Prospectus to comply with
any law or to file under the Exchange Act any document which would be
deemed to be incorporated by reference in the Prospectus in order to comply
with the Act or the Exchange Act, the Company promptly will notify the
Representatives and, subject to the Representatives' prior review, prepare
and file with the Commission and any appropriate Other Securities Regulator
an appropriate amendment or supplement to the Prospectus or file such
document (at the expense of the Company) so that the Prospectus as so
amended or supplemented will not, in light of the circumstances when it is
so delivered, be misleading, or so that the Prospectus will comply with the
law.
(f) The Company will make generally available to its security holders
in the manner contemplated by Rule 158(b) under the Act, as soon as it is
practicable to do so, but in any event not
11
later than the 90th day after the end of the fiscal quarter first occurring
one year after the Effective Date, an earnings statement in reasonable
detail, covering a period of at least twelve consecutive months beginning
after the Effective Date, which earnings statement shall satisfy the
requirements of Section 11(a) of the Act and will advise you in writing
when such statement has been so made available.
(g) For a period of three years from the date of this Agreement, the
Company will furnish to the Representatives (a) concurrently with
furnishing of such reports to its stockholders, statements of income of the
Company for each quarter in the form furnished to the Company's
stockholders; (b) concurrently with furnishing to its stockholders, a
balance sheet of the Company as at the end of such fiscal year, together
with statements of earnings, stockholders' equity and cash flow of the
Company for such fiscal year, all in reasonable detail and accompanied by a
copy of the certificate or report thereon of independent public
accountants; (c) as soon as they are available, copies of all reports
(financial or other) mailed to stockholders; (d) as soon as they are
available, copies of all reports and financial statements furnished to or
filed with the Commission; (e) every press release which was released or
prepared by the Company; and (f) any additional information of a public
nature concerning the Company or its business which you may reasonably
request. During such period, if the Company shall have active subsidiaries
the foregoing financial statements shall be on a consolidated basis to the
extent that the accounts of the Company and its subsidiaries are
consolidated, and shall be accompanied by similar financial statements for
any significant subsidiary (as defined by the Act) which is not so
consolidated.
(h) Promptly after the Company is advised thereof, it will advise the
Representatives, and confirm in writing, that the Registration Statement
and any amendments shall have become effective.
(i) The Company will use the net proceeds from the sale of the Shares
substantially in the manner set forth in the Prospectus under the caption
"Use of Proceeds."
(j) Other than as permitted by the Act and the Rules, the Company and
the Selling Stockholders will not distribute any prospectus or offering
materials in connection with the offering and sale of the Shares and prior
to the Closing Date or, if applicable, the Option Closing Date will not
issue any press releases or other communications directly or indirectly and
will hold no press conferences with respect to the Company, the financial
condition, results of operations, business, properties, assets or
liabilities of the Company, or the offering of the Shares, without the
prior written consent of the Representatives.
(k) The Company will maintain a transfer agent and, if necessary
under the jurisdiction of incorporation of the Company, a registrar for its
common stock and will use its best efforts to maintain the listing of the
Shares on the Nasdaq National Market.
(l) Except pursuant to the exercise of stock options existing prior
to the execution of this Agreement or as contemplated hereby or by the
Prospectus, the Company and the Selling Stockholders will not, for a period
of ninety (90) days after the Effective Date of the Registration Statement,
offer to sell, contract to sell, sell or otherwise dispose of any shares of
the Company's common stock or securities convertible into shares of the
Company's common stock without the prior written consent of BRS, which
consent will not be unreasonably withheld.
The foregoing covenants and agreements shall apply to any successor of the
Company, including without limitation, any entity into which the Company might
consolidate or merge.
12
6. COSTS AND EXPENSES. Whether or not the Registration Statement becomes
effective, the Company and the Selling Stockholders will pay all costs, expenses
and fees incident to the performance of the obligations of the Company and the
Selling Stockholders under this Agreement, including, without limiting the
generality of the foregoing, the following: accounting fees of the Company; the
fees and disbursements of counsel for the Company; the cost of printing and
delivering to Underwriters copies of the Registration Statement, any Preliminary
Prospectus, the Prospectus, this Agreement, the Agreement Among Underwriters,
the Selected Dealer Agreement, Underwriters' Questionnaire and Power of
Attorney, and the Blue Sky Survey and any supplements thereto; the filing fees
of the Commission; the filing fees incident to securing any required review by
the NASD of the terms of the sale of the Shares on behalf of, and any
disbursements made by, the Representatives or BRS in its capacity as a
"qualified independent underwriter;" any applicable listing fees; the cost of
printing certificates representing the Shares; and the cost and charges of any
transfer agent or registrar. Any transfer taxes imposed on the sale of the
Shares to the Underwriters will be paid by the Company or the Selling
Stockholders, as appropriate. Neither the Company nor the Selling Stockholders
shall, however, be required to pay for any of the Underwriters' expenses (other
than those related to qualification under State securities or Blue Sky laws)
except that, if the Public Offering shall not be consummated because the
conditions in Section 8 hereof are not satisfied, or because this Agreement is
terminated by the Representatives pursuant to Section 7 hereof, or by reason of
any failure, refusal or inability on the part of the Company to perform any
undertaking or satisfy any condition of this Agreement or to comply with any of
the terms hereof on their part to be performed, unless such failure to satisfy
said condition or to comply with said terms is due to the default or omission of
any Underwriter, then the Company shall reimburse the several Underwriters for
all costs and expenses, including attorney fees and out-of-pocket expenses,
reasonably incurred in connection with investigating, marketing and proposing to
market the Shares or in contemplation of performing their obligations hereunder,
but the Company shall not in any event be liable to any of the several
Underwriters for damages on account of loss of anticipated profits from the sale
by them of the Shares. The Company and the Selling Stockholders may agree, as
among themselves and without limiting the rights of the Underwriters under this
Agreement, as to the respective amounts of such costs for which they each shall
be responsible.
7. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS. The obligations of the
several Underwriters to purchase and pay for the Shares as provided herein, are
subject to the accuracy, as of the Closing Date and as of the Option Closing
Date, of the representations and warranties and agreements of the Company and
the Selling Stockholders contained herein and to the performance by the Company
and the Selling Stockholders of their obligations hereunder and to the following
additional conditions:
(a) The Registration Statement shall have become effective not
later than 10:00 a.m., central time, on the day immediately following
the date of this Agreement, unless a later time and date is agreed to by
the Representatives, and no stop order or other order suspending the
effectiveness thereof or the qualification of the Shares under the State
securities or Blue Sky laws of any jurisdiction shall have been issued
and no proceeding for that purpose shall have been taken or, to the
knowledge of the Company or the Selling Stockholders, shall be
contemplated or threatened by the Commission or any Other Securities
Regulator. If the Company has elected to rely upon Rule 430A of the
Rules, the price of the Shares and any price-related information
previously omitted from the effective Registration Statement pursuant to
such Rule 430A shall have been transmitted to the Commission for filing
pursuant to Rule 424(b) of the Act within the prescribed time period,
and prior to the Closing Date the Company shall have provided evidence
satisfactory to the Representatives of such timely filing, or a
post-effective amendment providing such information shall have been
promptly filed and declared effective in accordance with the
requirements of Rule 430A under the Act. All requests for additional
information on the part of the Commission or any other government or
regulatory authority with jurisdiction (to be included in the
Registration
13
Statement or Prospectus or otherwise) shall be complied with to the
satisfaction of the Commission or such authorities.
(b) The Representatives shall have received on the Closing Date and
on the Option Closing Date the opinion of O'Melveny & ▇▇▇▇▇ LLP, counsel
for the Company and the Selling Stockholders who are executive officers of
the Company (the "Officer Selling Stockholders"), with respect to the
Company and such Selling Stockholders as to the matters set forth below in
subparagraphs (i) through (x), and opinions of Massachusetts, Puerto Rico,
Mexico and Switzerland counsel to the Company with respect to the
Subsidiaries, as to matters set forth below in subparagraphs (i) and (vi),
each dated the Closing Date and, if applicable, the Option Closing Date,
addressed to the Underwriters in form and substance satisfactory to ▇▇▇▇▇▇,
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel to the Underwriters, to the effect that:
(i) The Company and the Subsidiaries have been duly organized
and are validly existing in good standing under the laws of the
state(s) or similar foreign jurisdictions (with respect to the
Subsidiaries) of their organization with corporate power to own their
properties and conduct their business as described in the Registration
Statement and Prospectus; and to such counsel's knowledge, except as
set forth in the Prospectus and the Registration Statement, no
options, warrants or other rights to purchase, agreements or other
obligations to issue or other rights to convert any obligations into
any shares of capital stock of the Company are outstanding.
(ii) The Company has authorized capital stock as set forth
under the caption "Description of Capital Stock" in the Registration
Statement and Prospectus, except for issuances subsequent to the date
of the Prospectus, if any, pursuant to reservations, commitments,
employee benefit plans, or other existing agreements; all of the
Shares conform to the description thereof contained in the Prospectus;
the Company Shares and the Option Shares, if any, have been duly
authorized by all necessary corporate action on the part of the
Company and, upon payment for and delivery of the Shares in accordance
with this Agreement and the countersigning of the certificates
representing the Shares by a duly authorized signatory, the Shares
will be validly issued, fully paid and non-assessable; holders of the
capital stock of the Company are not entitled to any preemptive right
to subscribe to any additional shares of the Company's capital stock
under the Company's Certificate of Incorporation or bylaws, or, to
such counsel's knowledge, any agreement or other instrument filed as
an exhibit to the Registration Statement.
(iii) The Registration Statement has been declared effective
under the Act and to such counsel's knowledge, no stop order
suspending the effectiveness of the Registration Statement has been
issued or threatened by the Commission.
(iv) The Registration Statement and each amendment or
supplement thereto on the dates they were filed appeared on their
face to comply as to form in all material respects with the
requirements as to form for registration statements on Form S-3 under
the Act and the Rules, except that such counsel need express no
opinion as to the information supplied by the Underwriters or the
financial statements, schedules and other financial or statistical
information included or incorporated by reference therein. The
Incorporated Documents, on the respective dates they were filed,
appeared on their face to comply in all material respects with the
requirements as to form for reports on Form 10-K, Form 10-Q and Form
8-K, as the case may be, under the Exchange Act and the rules and
regulations thereunder in effect at the respective dates of their
filing, except that such counsel need
14
express no opinion as to the financial statements, schedules and
other financial or statistical information included or incorporated
by reference therein.
(v) Except as set forth in the Registration Statement and the
Prospectus, to such counsel's knowledge, there are no contracts,
agreements or understandings between the Company and any person
granting such person the right to require the Company to file a
registration statement under the Act with respect to any securities of
the Company owned or to be owned by such person or to require the
Company to include such securities in the securities being registered
pursuant to a registration statement filed by the Company under the
Act.
(vi) To such counsel's knowledge, the Company's execution and
delivery of, and performance of its obligations under, this Agreement
do not (A) violate the Company's and its Subsidiaries' respective
charter or bylaws, or (B) breach or otherwise violate any existing
obligation of or restriction on the Company or its Subsidiaries under
any order, judgment or decree of any federal or Delaware court or
government authority binding on the Company or its Subsidiaries that
such counsel has, in the exercise of customary professional diligence,
recognized as applicable to the Company or its Subsidiaries or to
transactions of the type contemplated by this Agreement, except that
such counsel need not express an opinion regarding any federal
securities laws or Blue Sky or state securities laws. The execution
and delivery by the Company of, and performance of its obligations
under, this Agreement, do not violate any Delaware or federal statute
or regulation that such counsel has, in the exercise of customary
professional diligence, recognized as applicable to the Company or its
Subsidiaries or to transactions of the type contemplated by this
Agreement, except that such counsel need not express an opinion
regarding any federal securities laws or Blue Sky or state securities
laws.
(vii) This Agreement has been duly authorized, executed and
delivered by the Company.
(viii) No approval, consent, order or permit of Delaware or any
U.S. Federal governmental authority is required on the part of the
Company for the execution and delivery of this Agreement or for the
issuance and sale of the Shares by the Company herein contemplated
(other than required by NASD regulation or state securities and Blue
Sky laws, as to which such counsel need express no opinion) except
such as have been obtained or made, specifying the same.
(ix) This Agreement has been duly executed and delivered on
behalf of each of the Officer Selling Stockholders.
(x) Upon the delivery of and payment for the Officer Selling
Stockholders Shares as contemplated in this Agreement, each of the
Underwriters will receive such Shares purchased by it from such
Selling Stockholder, free and clear of any adverse claim. In
rendering such opinion, such counsel may assume that the Underwriters
are acquiring such Shares in good faith, without notice of any adverse
claim.
In addition to the matters set forth above, such counsel shall also
include a statement to the effect that such counsel has participated in the
preparation of the Registration Statement and the Prospectus and, based on
such participation, no facts have come to the attention of such counsel
which appeared on their face to cause such counsel to believe that any part
of the Registration Statement or any amendment thereto (other than the
financial statements and other financial and
15
statistical data contained therein, as to which such counsel may express
no belief), as of its effective date, 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 or any amendment or supplement thereto
(other than the financial statements and other financial data contained
therein, as to which such counsel may express no belief), contains any
untrue statement of a material fact or omitted to state any material
fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. Such counsel
does not know of any legal or governmental proceedings required to be
described in the Registration Statement or the Prospectus which are not
described as required or of any contracts or documents of a character
required to be described in the Registration Statement or the Prospectus
or to be filed as exhibits to the Registration Statement which are not
described and filed as required; it being understood that such counsel
need express no opinion as to the financial statements or other
financial data contained in the Registration Statement or the
Prospectus. Such counsel may state that its opinion is limited to the
applicable law of the United States of America, the Delaware General
Corporation Law and the general corporate law of jurisdictions under
which the Subsidiaries are organized, and that such counsel renders no
opinion with respect to the law of any other jurisdiction. Such opinion
may state further that whenever such opinion is based on factual matters
to such counsel's knowledge or known to such counsel, such counsel has
relied exclusively on certificates of officers (after discussion of the
contents thereof with such officers) of the Company or certificates of
others as to the existence or nonexistence of factual matters on which
such opinion is predicated but has no reason to believe that any such
certificate is untrue or inaccurate in any material respect.
Such opinion shall contain only those qualifications as ▇▇▇▇▇▇,
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel to the Underwriters, may reasonably request
or allow.
(c) The Representatives shall have received from ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ LLP, counsel to the Underwriters, an opinion dated the Closing
Date, substantially to the effects specified in subparagraph (iii) and (iv)
of paragraph (b) of this Section 7, and that the Company is a validly
organized and existing corporation under the laws of the State of Delaware.
In rendering such opinion, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP may rely as to
all matters governed other than by Federal law on the opinions of counsel
referred to in paragraph (b) of this Section 7. In addition to the matters
set forth above, such opinion shall also include a statement to the effect
that nothing has come to the attention of such counsel which leads them to
believe that the Registration Statement or any amendment thereto at the
time the Registration Statement or amendment became effective or the
Preliminary Prospectus or the Prospectus or any amendment or supplement
thereto as of their respective dates contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, not misleading (except
that such counsel need express no view as to financial statements,
schedules and other financial or statistical information included therein).
(d) The Representatives shall have received at or prior to the
Closing Date from ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP a memorandum or summary,
in form and substance satisfactory to the Representatives, with respect to
the qualification or exemption therefrom for offering and sale by the
Underwriters of the Shares under the State securities or Blue Sky laws of
such jurisdictions as the Representatives may reasonably have designated.
(e) The Representatives shall have received on the Closing Date and
on the Option Closing Date, as the case may be, signed letters from
Deloitte & Touche LLP, addressed to the Underwriters dated as of the
Effective Date and again dated as of the Closing Date and as of the Option
Closing Date, as the case may be, with respect to the financial statements
and certain
16
financial and statistical information contained in the Registration
Statement and the Prospectus. All such letters shall be in form and
substance satisfactory to the Representatives and ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇ LLP, counsel to the Underwriters.
(f) The Representatives shall have received on the Closing Date and
on the Option Closing Date, as the case may be, a certificate or
certificates of the Company, executed by the President & Chief Executive
Officer and Senior Vice President and Chief Financial Officer of the
Company to the effect that, on and as of the Closing Date and on and as of
the Option Closing Date, as the case may be, each of them severally
represents as follows:
(i) (A) the representations and warranties of the Company in
this Agreement are true and correct on and as of the Closing Date and
on and as of the Option Closing Date, as the case may be, and (B) the
Company has complied with all of its agreements and covenants and has
satisfied all of the conditions on its part to be performed or
satisfied at or prior to the Closing Date and at or prior to the
Option Closing Date, as the case may be.
(ii) They have carefully examined the Registration Statement
and the Prospectus and, in their opinion, such Registration Statement
and Prospectus did not omit to state a material fact necessary in
order to make the statements therein not misleading.
(g) The Company shall have furnished to the Representatives evidence
of the due qualification of the Company and the Subsidiaries to transact
business in all jurisdictions in which the conduct of their business or
ownership or lease of their properties requires such qualifications, except
where the failure to be so qualified would not reasonably be expected to
have a Material Adverse Effect.
(h) Since the respective dates as of which information is given in
the Prospectus, there shall not have been any Material Adverse Change.
(i) The Company Shares shall have been approved for listing on the
Nasdaq National Market, subject to official notice of issuance.
The opinions and certificates mentioned in this Agreement shall be deemed
to be in compliance with the provisions hereof only if they are in all material
respects satisfactory to the Representatives and ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP,
counsel for the Underwriters.
If any of the conditions hereinabove provided for in this Section 7 shall
not have been fulfilled when and as required by this Agreement to be fulfilled,
the obligations of the Underwriters hereunder may be terminated by the
Representatives by notifying the Company of such termination in writing or by
confirmed telefax at or prior to the Closing Date. In such event, the Company,
the Selling Stockholders and the Underwriters shall not be under any obligation
to each other (except to the extent provided in Sections 6, and 9 hereof).
8. CONDITIONS OF THE OBLIGATIONS OF THE SELLERS. The obligations of the
Sellers to sell and deliver the Shares are subject to the conditions that (a) at
or before 10:00 a.m., central time, on the day immediately following the date of
this Agreement, or such later time and date as the Company and the
Representatives may from time to time consent to in writing or by confirmed
telefax, the Registration Statement shall have become effective, and (b) at the
Closing Date no stop order suspending the effectiveness of the Registration
Statement shall have been issued or proceedings therefor initiated or
threatened. If either of the conditions hereinabove provided for in this
Section 8 shall not have been fulfilled
17
when and as required by this Agreement to be fulfilled, this Agreement may be
terminated by the Company by notifying the Representatives of such
termination in writing or by confirmed telefax at or prior to the Closing Date.
9. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within
the meaning of the Act, the Rules and the Exchange Act from and against any
and all losses, claims, damages, liabilities, joint or several, to which
such Underwriter or such controlling person may become subject under the
Act or otherwise, insofar as such losses, claims, damages or liabilities
(or actions or proceedings in respect thereof) arise out of or are based
upon any breach of any representation, warranty, agreement, or covenant of
the Company, or any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, any Preliminary
Prospectus, the Prospectus or any amendment or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading; and the Company will reimburse each
Underwriter and each such controlling person for legal and other expenses
reasonably incurred in connection with investigating or defending any such
loss, claim, damage, liability, action or proceeding; 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 an
untrue statement or alleged untrue statement made in, or omission or
alleged omission from, the Registration Statement, any Preliminary
Prospectus, the Prospectus, or such amendment or supplement, in reliance
upon and in conformity with written information furnished to the Company by
or through the Representatives specifically for use in the preparation
thereof, it being understood and agreed that the only such information
furnished by any Underwriter consists of the information described as such
in Section 14 below; and PROVIDED FURTHER, that with respect to any untrue
statement or alleged untrue statement in or omission or alleged omission
from any Preliminary Prospectus, the indemnity agreement contained in this
Section 9(a) shall not inure to the benefit of any Underwriter from whom
the person asserting any such losses, claims, damages or liabilities
purchased the Shares concerned, to the extent that a prospectus relating to
such Shares was required to be delivered by such Underwriter under the Act
in connection with such purchase and any such loss, claim, damage or
liability of such Underwriter, results from the fact that there was not
sent or given to such person, at or prior to the written confirmation of
the sale of such Shares to such person, a copy of the Prospectus as then
amended or supplemented (excluding any documents incorporated by reference
therein) if the Company had previously furnished copies thereof to such
Underwriter. This indemnity agreement will be in addition to any liability
which the Company may otherwise have.
(b) Each Selling Stockholder severally and not jointly agrees to
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter, within the meaning of the Act, the Rules and the
Exchange Act, from and against any losses, claims, damages, or liabilities,
joint or several (or actions or proceedings in respect thereof) and all
expenses (including costs of investigation and legal expenses) to which
such Underwriters or such controlling person may become subject under the
Act or otherwise, insofar as such losses, claims, liabilities or expenses
arise out of or are based upon any breach of any representation, warranty,
agreement, or covenant of such Selling Stockholder contained in this
Agreement or any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, any Preliminary
Prospectus, the Prospectus or any amendment or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or
omission or alleged
18
omission was made in the Registration Statement, any Preliminary
Prospectus, the Prospectus, or any amendment or supplement thereto, in
conformity with written information furnished to the Company by or on
behalf of such Selling Stockholder specifically for use therein;
PROVIDED, HOWEVER, that such Selling Stockholder will not be liable in
any such case to the extent that such statement or omission was
contained or made in any Preliminary Prospectus and corrected in the
Prospectus and (A) any such loss, claim, damage or liability suffered or
incurred by any Underwriter (or any person who controls any Underwriter)
resulted from any action, claim or suit by any person who purchased
Shares which are the subject thereof from such Underwriter in the
offering and (B) such Underwriter failed to deliver or provide a copy of
the Prospectus to such person at or prior to the confirmation of the
sale of such Shares, in the case where such delivery is required by the
Act. This indemnity agreement will be in addition to any liability
which the Selling Stockholders may otherwise have.
Each Selling Stockholder shall be liable to all persons under the
indemnity agreements contained in this paragraph (b) and for breaches of
its representations contained in Section 1 hereof only for an amount not
exceeding the net proceeds received by such Selling Stockholder from the
sale of Shares hereunder.
(c) Each Underwriter severally, but not jointly, will indemnify and
hold harmless the Selling Stockholders and the Company, each of its
directors, each of its officers who have signed the Registration Statement,
and each person, if any, who controls the Company, within the meaning of
the Act, the Rules and the Exchange Act from and against any losses,
claims, damages or liabilities to which the Company, or any such director,
officer, or controlling person may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances under which they were
made; and will reimburse any legal or other expenses reasonably incurred by
the Selling Stockholders or the Company, or any such director, officer, or
controlling person in connection with investigating or defending any such
loss, claim, damage, liability, action or proceeding; PROVIDED, HOWEVER,
that each Underwriter will be liable in such case only to the extent that
such untrue statement, or alleged untrue statement or omission or alleged
omission has been made in the Registration Statement, any Preliminary
Prospectus, the Prospectus, or such amendment or supplement, in reliance
upon and in conformity with information furnished to the Company by or
through the Representatives expressly for use in the preparation thereof,
which information is described in Section 14. This indemnity agreement
will be in addition to any liability which such Underwriter may otherwise
have.
(d) Promptly after receipt by an indemnified party under this Section
9 of notice of the commencement of any action or proceeding, such
indemnified party will, if a claim in respect thereof is to be made against
an indemnifying party under this Section 9, notify the indemnifying party
of the commencement thereof; but the omission so to notify the indemnifying
party will not relieve it from any liability which it may have to any
indemnified party otherwise than under this Section 9, except to the extent
that the indemnifying party is substantially prejudiced by the omission of
such notification. In case any such action or proceeding is brought
against any party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate therein, and, to the extent that it may wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof
with counsel reasonably satisfactory to such indemnified party, and after
notice from the indemnifying party to such
19
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under
this Section 9 for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which
any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified party
from all liability on claims that are the subject matter of such
proceeding. Any indemnified party shall have the right to employ
separate counsel in any such action and participate in the defense
thereof, but the fees and expenses of such counsel shall be at the
expense of such indemnified party uness (i) the employment of such
counsel has been specifically authorized in writing by the indemnifying
party, (ii) the indemnifying party has failed to assume the defense and
employ counsel, or (iii) the named parties to any such action (including
any impleaded parties) include such indemnified party and the
indemnifying party, as the case may be, and such indemnified party shall
have been advised in writing by such counsel that there may be one or
more legal defenses available to it which are different from or
additional to those available to the indemnifying party, in which case
the indemnifying party shall not have the right to assume the defense of
such action on behalf of such indemnified party, it being understood,
however, that (A) the indemnifying party shall not, in connection with
any one such action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the fees and expenses of
more than one separate firm of attorneys (in addition to any local
counsel) for all such indemnified parties, which firm shall be
designated in writing by the indemnified parties, and that (B) all such
fees and expenses shall be reimbursed as they are incurred. Subject to
the foregoing provisions of this Section 9(d), the indemnifying party
shall not be liable for the costs and expenses of any settlement of any
action without the consent of the indemnifying party.
(e) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in this Section 9
is for any reason held to be unavailable to an indemnified party under
subsection (a), (b) or (c) above in respect to any losses, claims, damages,
liabilities or expenses referred to therein, then each applicable
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages, liabilities and expenses (i) in
such proportion as is appropriate to reflect the relative benefits received
by the Sellers on the one hand and the Underwriters on the other hand from
the offering of the Shares or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the parties in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable
considerations. The relative benefits received by the Sellers on the one
hand and the Underwriters on the other hand shall be deemed to be in the
same proportion as the total proceeds from the offering (net of
underwriting discounts and commissions but before deducting expenses)
received by the Sellers bears to the underwriting discounts and commissions
received by the Underwriters. The relative fault of a party shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by each
party and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The
amount paid or payable by a party as a result of the losses, claims,
damages, liabilities and expenses referred to above shall be deemed to
include any legal or other fees or expenses reasonably incurred by such
party in connection with investigating or defending any such action or
claim.
20
The Sellers and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. Notwithstanding the provisions of this Section 9, no
Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Shares underwritten by it and
distributed to the public were offered to the public exceeds the amount of
any damages that such Underwriters have otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations in this subsection (e) to contribute shall be
several in proportion to their respective underwriting obligations and not
joint.
(f) In any proceeding relating to the Registration Statement, any
Preliminary Prospectus, the Prospectus or any supplement or amendment
thereto, each party against whom contribution may be sought under this
Section 9 hereby consents to the jurisdiction of any court having
jurisdiction over any other contributing party, agrees that process issuing
from such court may be served upon him or it by any other contributing
party and consents to the service of such process and agrees that any other
contributing party may join him or it as an additional defendant in any
such proceeding in which such other contributing party is a party.
(g) Without limitation and in addition to its obligations under the
other subsections of this Section 9, the Company agrees to indemnify and
hold harmless BRS, and each person, if any, who controls BRS within the
meaning of the Act, the Rules or the Exchange Act, from and against any
loss, claim, damage, liabilities or expense, as incurred, arising out of or
based upon BRS acting as a "qualified independent underwriter" (within the
meaning of Rule 2720 of the NASD's Conduct Rules) in connection with the
offering contemplated by this Agreement, and agrees to reimburse each such
indemnified person for any legal and other expense reasonably incurred by
them in connection with investigating, defending, settling, compromising or
paying any such loss, claim, damage, liability, expense or action;
PROVIDED, HOWEVER, that the Company shall not be liable in any such case to
the extent that any such loss, claim, damage, liability or expense results
from the gross negligence or willful misconduct of BRS.
10. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY. All
representations, warranties and agreements of the Selling Stockholders, the
Company, and the officers of the Company herein or in certificates delivered
pursuant hereto, and the indemnity and contribution agreements contained in
Section 9 hereof, shall remain operative and in full force and effect regardless
of any investigation made by or on behalf of any Underwriters or any controlling
person, or by or on behalf of the Company or any of its officers, directors or
controlling persons, and shall survive delivery of the Underwritten Shares and,
if appropriate, the Option Shares to the Representatives or termination of this
Agreement.
11. DEFAULT BY UNDERWRITERS. If any Underwriter shall fail to purchase
and pay for the Shares which such Underwriter has agreed to purchase and pay for
hereunder (otherwise than by reason of any default on the part of the Company or
any of the Selling Stockholders), you, as the Representatives of the
Underwriters, shall use your best efforts to procure within twenty-four hours
thereafter one or more of the other Underwriters, or any others, to purchase
from the Company and the Selling Stockholders such amounts as may be agreed upon
and upon the terms set forth herein, the Shares which the defaulting Underwriter
or Underwriters failed to purchase. If during such twenty-four hours you, as
such Representatives, shall not have procured such other Underwriters, or any
others, to purchase the Shares agreed to be purchased by the defaulting
Underwriter or Underwriters, then (a) if the aggregate number of
21
Shares with respect to which such default shall occur does not exceed 10% of
the Shares which the Underwriters are obligated to purchase hereby, the other
Underwriters shall be obligated, severally, in proportion to the respective
number of Shares which they are obligated to purchase hereunder, to purchase
the Shares which such defaulting Underwriter or Underwriters failed to
purchase, or (b) if the aggregate number of Shares with respect to which such
default shall occur exceeds 10% of the Shares covered hereby, the Company or
you, as the Representatives of the Underwriters, will have the right, by
written notice given within the next twenty-four hour period to the parties
to this Agreement, to terminate this Agreement without liability on the part
of the non-defaulting Underwriters or the Company or the Selling Stockholders
except to the extent provided in Section 9 hereof. In the event of a default
by any Underwriter or Underwriters, as set forth in this Section 11, the time
of closing may be postponed for such period, not to exceed seven days, as
you, as the Representatives, may determine in order that the required changes
in the Registration Statement, the Prospectus or in any other documents or
arrangements may be effected. The term "Underwriters" includes any person
substituted for a defaulting Underwriter. Any action taken under Section 11
shall not relieve any defaulting Underwriter from liability in respect of any
default of such Underwriter under this Agreement.
12. NOTICES. All communications hereunder shall be in writing and,
except as otherwise provided in, will be mailed, delivered or telefaxed and
confirmed as follows: if to the Underwriters, c/o the Representatives as
follows: to ▇▇▇▇▇▇▇▇ Inc., ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, with a copy to C. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇., ▇▇▇▇▇▇,
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇; if to the Company or the Selling Stockholders, to Power-One,
Inc., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, with a copy to ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, O'Melveny & ▇▇▇▇▇ LLP, ▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇.
13. TERMINATION. This Agreement may be terminated by notice to the
Sellers as follows:
(a) at any time prior to the Closing Date if any of the following has
occurred: (i) since the respective dates as of which information is given
in the Registration Statement and the Prospectus, any Material Adverse
Change which would, in your reasonable judgment, materially make it
impracticable to market the Shares in the manner contemplated by the
Prospectus, (ii) any outbreak of hostilities or other national or
international calamity or crisis or change in economic or political
conditions if the effect of such outbreak, calamity, crisis or change on
the financial markets of the United States would, in your reasonable
judgment, make the offering or delivery of the Shares impracticable, (iii)
suspension of trading or general trading halts in securities on the New
York Stock Exchange, the American Stock Exchange, the Nasdaq National
Market or the over-the-counter market or limitation on prices (other than
limitations on hours or numbers of days or trading) for securities on
either such Exchange, the Nasdaq National Market or the over-the-counter
market, (iv) the enactment, publication, decree or other promulgation of
any federal or state statute, regulation, rule or order of any court or
other governmental authority which in your reasonable opinion materially
and adversely affects or will materially or adversely affect the business
or operations of the Company, or (v) declaration of a banking moratorium by
either federal or state authorities; or
(b) as provided in Sections 7 and 11 of this Agreement.
14. INFORMATION FURNISHED BY UNDERWRITERS. The information set forth in
the Prospectus: (a) in the penultimate paragraph on the cover page, (b) in the
table under the caption "Underwriting" on page _____, listing the Underwriters
and the number of shares each has agreed to purchase, and in the first and third
paragraphs immediately following such table, relating to the concession to
dealers and the reallowance to certain other dealers and the delivery of the
Shares, (c) in the subsection captioned "Stabilization" under
22
the caption "Underwriting", (d) the last sentence of the subsection captioned
"Qualified Independent Underwriter" under the caption "Underwriting", and (e)
in the second paragraph of the subsection captioned "Other Matters" under the
caption "Underwriting" constitute the written information furnished by or on
behalf of any Underwriters referred to in paragraph (a) (v) of Section 1
hereof and in paragraphs (a) and (b) of Section 9 hereof.
15. SUCCESSORS. This Agreement has been and is made solely for the
benefit of the Underwriters, the Company, the Selling Stockholders and their
respective successors, executors, administrators, heirs, and assigns, and the
officers, directors and controlling persons referred to herein, and no other
person will have any right or obligation hereunder. The term "successors" shall
not include any purchaser of the Shares merely because of such purchase.
16. MISCELLANEOUS. The Representatives will act for the several
Underwriters in connection with this offering, and any action under this
Agreement taken by the Representatives jointly or by ▇▇▇▇▇▇▇▇ Inc. will be
binding upon all of the Underwriters.
This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Arkansas, without giving effect to the choice of law or
conflict of law principles thereof.
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicates hereof, whereupon it will
become a binding agreement among the Company, the Selling Stockholders and the
several Underwriters in accordance with its terms.
Very truly yours,
POWER-ONE, INC.
By:
-----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
President and Chief Executive Officer
SELLING STOCKHOLDERS
By:
-----------------------------------
Attorney in Fact
23
The foregoing Underwriting Agreement is hereby
confirmed and accepted as of the date first above written.
▇▇▇▇▇▇▇▇ INC., BANCBOSTON ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ INC.
AND ▇▇▇▇▇▇ ▇▇▇▇▇▇ PARTNERS LLC
By:
-----------------------------------
▇▇▇▇▇▇▇▇ Inc., Senior Manager
Name:
---------------------------------
Title:
--------------------------------
As Representatives of the several Underwriters
named in Schedule II hereto
24
SCHEDULE I
Seller No. of Underwritten Shares
------ --------------------------
Power-One, Inc. 4,000,000
Voting Trust dated as of June 8, 1998 1,540,600
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ 459,200
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ 63,500
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ 132,200
▇▇▇▇▇ ▇. ▇▇▇▇ 133,900
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ 72,500
▇▇▇▇▇ ▇▇▇▇ 38,700
Grandchild's Trust One UID 12/16/85 9,800
Grandchild's Trust Two UID 12/16/85 9,800
Grandchild's Trust Three UID 12/89 9,800
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 1995 Trust UID 12/16/85 7,500
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇. 1995 Trust UID 12/4/95 7,500
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Trust UID 12/4/95 7,500
▇.▇. ▇▇▇▇▇▇▇▇ ▇▇. Children's Trust UID 3/1/95 7,500
---------
Total 6,500,000
---------
---------
25
SCHEDULE II
Name No. of Underwritten Shares
---- --------------------------
▇▇▇▇▇▇▇▇ Inc.
BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc.
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC
----------
Total
----------
----------
26
EXHIBIT A
_______________, 1999
▇▇▇▇▇▇▇▇ Inc., BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Inc. and
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC, as Representatives of the Several Underwriters
c/o Stephens Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Agreement Not to Sell Power-One, Inc. Stock
------------------------------------------------
Ladies and Gentlemen:
This letter is provided, at the request of Power-One, Inc. (the "Company"),
for the benefit of the Company and the Underwriters in connection with the
proposed public offering of 6,500,000 shares of Power-One, Inc. Common Stock
(plus an additional 975,000 shares if the Underwriters choose to exercise their
over-allotment option) pursuant to a Registration Statement on Form S-3 (File
No. __________). As an inducement to the Underwriters to (a) enter into an
Underwriting Agreement with the Company and (b) consummate the transactions
contemplated in such Underwriting Agreement, the undersigned hereby represents
and agrees as follows:
1. Upon the closing of the Company's public offering, the undersigned
will beneficially own the number of shares of the Company's Common Stock set
forth below opposite the signature of the undersigned (the "Shares"), and no
others.
2. The undersigned agrees that, for a period of 90 days from the
effective date of the Registration Statement, except for bona fide gifts to
persons who agree with you in writing to be bound by this letter, the
undersigned will not offer, sell or otherwise dispose of any of the Shares,
directly or indirectly, without written consent of BancBoston ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Inc., on behalf of the Representatives of the Underwriters, which consent will
not be unreasonably withheld; except that (a) such Shares may be pledged as
collateral against loans of the undersigned without such written consent, and
(b) if loans secured by Shares are called, the undersigned and any applicable
pledgee will have the right to sell the shares pledged on such loans to the
extent necessary to satisfy such loans.
Shares of Common Stock: Very truly yours,
----------------------- --------------------------
27
