SPS Commerce, Inc. Common Stock Underwriting Agreement
Exhibit 1.1
SPS Commerce, Inc.
Common Stock
Common Stock
________________, 2010
Xxxxxx, Xxxxxxxx & Company, Incorporated
As representative of the Underwriters
named in Schedule I hereto,
x/x Xxxxxx, Xxxxxxxx & Company, Incorporated
Xxx Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
As representative of the Underwriters
named in Schedule I hereto,
x/x Xxxxxx, Xxxxxxxx & Company, Incorporated
Xxx Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Ladies and Gentlemen:
SPS Commerce, Inc., a Delaware corporation (the “Company”), proposes, subject to the terms and
conditions stated herein, to issue and sell to the Underwriters named in Schedule I hereto
(the “Underwriters”) an aggregate of 100,000 shares of Common Stock, $0.001 par value (“Stock”) of
the Company, and, at the election of the Underwriters, up to 15,000 additional shares of Stock, and
the stockholders of the Company named in Schedule II hereto (the “Selling Stockholders”)
propose, subject to the terms and conditions stated herein, to sell to the Underwriters an
aggregate of [___] shares of Stock and, at the election of the Underwriters, up to
[___] additional shares of Stock. The aggregate of [___] shares to be sold by the
Company and the Selling Stockholders is herein called the “Firm Shares” and the aggregate of
[___] additional shares to be sold by the Company and the Selling Stockholders is herein
called the “Optional Shares”. The Firm Shares and the Optional Shares are herein collectively
called the “Shares”.
1. The Company represents and warrants to, and agrees with, each of the Underwriters that:
(a) A registration statement on Form S-1 (File No. 333-[___]) (the “Initial Registration
Statement”) in respect of the Shares has been filed with the Securities and Exchange Commission
(the “Commission”); the Initial Registration Statement and any post-effective amendment thereto,
each in the form heretofore delivered to you, have been declared effective by the Commission in
such form; other than a registration statement, if any, increasing the size of the offering (a
“Rule 462(b) Registration Statement”), filed pursuant to Rule 462(b) under the Securities Act of
1933, as amended (the “Act”), which became effective upon filing, no other document with respect to
the Initial Registration Statement has heretofore been filed with the Commission; and no stop order
suspending the effectiveness of the Initial Registration Statement, any post-effective amendment
thereto or the Rule 462(b) Registration Statement, if any, has been issued and no proceeding for
that purpose, to the best of the knowledge of the Company, has been initiated or threatened by the
Commission (any preliminary prospectus included in the Initial Registration Statement or filed with
the Commission pursuant to Rule 424(a) of the rules and regulations of the Commission under the
Act is hereinafter called a “Preliminary Prospectus”); the various parts of the Initial
Registration Statement and the Rule 462(b) Registration Statement, if any, including all exhibits
thereto and including the information contained in the form of final prospectus filed with the
Commission pursuant to Rule 424(b) under the Act in accordance with Section 6(a) hereof and deemed
by virtue of Rule 430A under the Act to be part of the Initial Registration Statement at the time
it was declared effective, each as amended at the time such part of the Initial Registration
Statement became effective or such part of the Rule 462(b) Registration Statement, if any, became
or hereafter becomes effective, are hereinafter collectively called the “Registration Statement”;
the Preliminary Prospectus, as amended and supplemented immediately prior to the Applicable Time,
including any document incorporated by reference therein is hereinafter called the “Statutory
Prospectus”; the General Use Free Writing Prospectus(es) (as defined in Section 1(c) hereof) issued
at or prior to the Applicable Time (as defined in
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Section 1(c) hereof) and the Statutory
Prospectus, all considered together are hereinafter called the “Pricing Prospectus”; such final
prospectus, in the form first filed pursuant to Rule 424(b) under the Act, is hereinafter called
the “Prospectus”; and any “issuer free writing prospectus” as defined in Rule 433 under the Act,
relating to the Shares in the form filed or required to be filed with the Commission or, if not
required to be filed, in the form retained in the Company’s records pursuant to Rule 433(g) under
the Act is hereinafter called an “Issuer Free Writing Prospectus”); all references in this
Agreement to the Initial Registration Statement, the Rule 462(b) Registration Statement, a
Preliminary Prospectus, the Pricing Prospectus and the Prospectus, or any amendments or supplements
to the foregoing, shall be deemed to refer to and include any copy thereof filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval System;
(b) No order preventing or suspending the use of any Preliminary Prospectus or any Issuer Free
Writing Prospectus has been issued by the Commission, and each Preliminary Prospectus, at the time
of filing thereof, conformed in all material respects to the requirements of the Act and the rules
and regulations of the Commission thereunder, and did not 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, in the light of the circumstances under which they were made, not misleading;
provided, however, that this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information furnished in writing to the
Company by an Underwriter through Xxxxxx, Xxxxxxxx & Company, Incorporated expressly for use
therein, it being understood and agreed that the only such information is that described in Section
10(d) hereof;
(c) For the purposes of this Agreement, the “Applicable Time” is 7:30 p.m. (Eastern time) on
the date of this Agreement. As of the Applicable Time, and as of each Time of Delivery, as the
case may be, neither (i) the Pricing Prospectus nor (ii) any individual Limited Use Free Writing
Prospectus (as defined below), when considered together with the Pricing Prospectus, included or
will include any untrue statement of a material fact or omitted or will omit to state any material
fact necessary in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; and each Issuer Free Writing Prospectus (A) does not conflict
with the information contained in the Registration Statement and the Pricing Prospectus, (B) will
not conflict with the information contained in the Prospectus, and (C) as supplemented by and taken
together with the Pricing Prospectus as of the Applicable Time, did not include any untrue
statement of a material fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not misleading;
and each broadly available road show, if any, when considered together with the Pricing Prospectus,
does not contain any untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that the representations and warranties in this Section
1(c) shall not apply to statements or omissions made in the Pricing Prospectus or an Issuer Free
Writing Prospectus in reliance upon and in conformity with information furnished in writing to the
Company by an Underwriter through Xxxxxx, Xxxxxxxx & Company, Incorporated expressly for use
therein, it being understood and agreed that the only such information is that described in Section
10(d) hereof. As used in this subsection and elsewhere in this Agreement:
“Broadly available road show” means a “bona fide electronic road show” as defined in Rule
433(h)(5) under the Act that has been made available without restriction to any person
“General Use Free Writing Prospectus” means any Issuer Free Writing Prospectus that is
intended for general distribution to prospective investors, as evidenced by its being so identified
on Schedule III to this Agreement.
“Limited Use Free Writing Prospectus” means any Issuer Free Writing Prospectus that is not a
General Use Free Writing Prospectus.
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(d) The Registration Statement conforms, and the Prospectus and any further amendments or
supplements to the Registration Statement or the Prospectus will conform, in all material respects
to the requirements of the Act and the rules and regulations of the Commission thereunder and do
not and will not, as of the applicable effective date as to the Registration Statement and any
amendment thereto and as of the applicable filing date as to the Prospectus and any amendment or
supplement thereto, 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; provided,
however, that the representations and warranties in this Section 1(d) shall not apply to any
statements or omissions made in reliance upon and in conformity with information furnished in
writing to the Company by an Underwriter through Xxxxxx, Xxxxxxxx & Company, Incorporated expressly
for use therein, it being understood and agreed that the only such information is that described in
Section 10(d) hereof;
(e) The Company has not, directly or indirectly, distributed and will not distribute any
offering material in connection with the offering and sale of the Shares other than any Preliminary
Prospectus, the Prospectus and other materials, if any, permitted under the Act and consistent with
Section 6 below. The Company will file with the Commission all Issuer Free Writing Prospectuses
required to be filed in the time and manner required under Rule 433(d) under the Act;
(f) The Company has filed on a timely basis with the Commission all reports, registration
statements and other documents required by the Act, the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), or the rules and regulations of the Commission promulgated pursuant to the
Act or the Exchange Act. All such documents filed by the Company with the Commission, as of the
date they were filed, conformed in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and none
of such documents contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information furnished in writing to the
Company by an Underwriter through Xxxxxx, Xxxxxxxx & Company, Incorporated expressly for use
therein or by a Selling Stockholder expressly for use in the preparation of the answers therein to
Items 7 and 11(m) of Form S-1; and no such documents were filed with the Commission since the
Commission’s close of business on the business day immediately prior to the date of this Agreement
and prior to the execution of this Agreement, except as set forth on Schedule IV hereto;
(g) The Company (i) has not sustained since the date of the latest audited financial
statements included in the Pricing Prospectus any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute
or court or governmental action, order or decree and (ii) is not in violation of its charter or
by-laws or in default (or with the giving notice or lapse of time would be in default) under any
existing obligation, agreement, covenant or condition contained in any indenture, loan agreement,
mortgage, lease or other agreement or instrument to which it is a party or by which it is bound or
to which its properties is subject, in each case otherwise than as set forth or contemplated in the
Pricing Prospectus, and in each case except for such loss, interference, default or violation as
would not,
individually or in the aggregate, have a material adverse effect on the business, prospects,
properties, operations, assets, condition (financial or otherwise), stockholders’ equity or results
of operations of the Company (a “Material Adverse Effect”); and, since the respective dates as of
which information is given in the Registration Statement and the Pricing Prospectus, there has not
been (A) any change in the capital stock or long-term debt of the Company, other than the
expiration of or grants of stock options to employees of the Company pursuant to the Company’s
equity incentive plans in the ordinary course of business and the issuance of shares of Stock upon
the exercise of warrants and stock options by existing security holders of the Company in the
ordinary course of business, or (B) any material adverse change, or any development reasonably
expected to result in a material adverse change, in or affecting the business, prospects,
operations, assets, condition (financial or
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otherwise) or results of operations of the Company,
otherwise than as set forth or contemplated in the Pricing Prospectus;
(h) The Company does not own any real property. The Company has good and marketable title to
all personal property owned by it, in each case free and clear of all liens, encumbrances and
defects except such as are described in the Pricing Prospectus or such as do not materially affect
the value of such property and do not interfere with the use made and proposed to be made of such
property by the Company. Any real property and buildings held under lease by the Company are held
by it under valid, subsisting and enforceable leases with such exceptions as are not material and
do not interfere with the use made and proposed to be made of such property and buildings by the
Company;
(i) The Company has been duly incorporated and is validly existing as a corporation in good
standing under the laws of the State of Delaware, with power and authority (corporate and other) to
own, lease and operate its properties and conduct its business as described in the Pricing
Prospectus, and is duly qualified as a foreign corporation for the transaction of business and is
in good standing under the laws of each other jurisdiction in which it owns or leases properties or
conducts any business so as to require such qualification, except where the failure to be so
qualified and in good standing in any such jurisdiction would not have, individually or in the
aggregate, a Material Adverse Effect;
(j) The Company does not own, and at each Time of Delivery (as defined in Section 4(a)
hereof), will not own, directly or indirectly, any shares of stock or any other equity or long-term
debt securities of any corporation or have any equity interest in any corporation, firm,
partnership, joint venture, association or other entity;
(k) The Company has the authorized, and issued and outstanding capital stock as set forth in
the “Description of Capital Stock” section of the Pricing Prospectus; all of the issued shares of
capital stock of the Company (i) have been duly authorized and validly issued, (ii) are fully paid
and non-assessable, and (iii) were issued in compliance with all applicable state and federal
securities laws or an exemption thereto; all of the issued shares of Stock conform to the
description of the Stock that is contained in the “Description of Capital Stock” section of the
Pricing Prospectus and that will be contained in the “Description of Capital Stock” section of the
Prospectus; and none of the holders of capital stock of the Company are entitled to receive any
liquidation preference payment solely by virtue of the consummation of the offering contemplated in
this Agreement;
(l) The Shares have been duly authorized and, when issued and delivered against payment
therefor as provided herein, will be validly issued, fully paid and non-assessable and will conform
to the description of the Stock that is contained in the Pricing Prospectus and that will be
contained in the Prospectus; and no preemptive or similar rights with respect to (except as have
been waived in writing and delivered to Xxxxxx, Xxxxxxxx & Company, Incorporated), or any
restrictions (other than under federal and state securities laws) upon the voting or transfer of,
any of the Shares or the issue and sale thereof exist or will exist prior to or at any Time of
Delivery with respect to such Shares;
(m) The issue and sale of the Shares to be sold by the Company, the compliance by the Company
with all of the provisions of this Agreement and the consummation of the transactions herein
contemplated will not violate any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any of its properties, or
conflict with or result in a breach or violation of any of the terms or provisions of, or
constitute a default under, or give rise to a right of termination under, or result in the
acceleration of any obligation under any statute, indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company is a party or by which the Company
is bound or affected or to which any of the property or assets of the Company is subject or
affected, except for such breaches or violations as would not, individually or in the aggregate,
have a Material Adverse Effect, nor will
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such action result in any violation of the provisions of
the Certificate of Incorporation or By-laws of the Company;
(n) No consent, approval, authorization, order, registration, qualification, permit, license,
exemption, filing or notice (each an “Authorization”) of, from, with or to any court, tribunal,
government, governmental or regulatory authority, self-regulatory organization or body is required
for the issue and sale of the Shares or the consummation by the Company of the transactions
contemplated by this Agreement, except (A) the registration of the Shares under the Act; (B) such
Authorizations as may be required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Shares by the Underwriters; (C) the approval of the Financial
Industry Regulatory Authority, Inc. (“FINRA”) of the underwriting terms and arrangements of the
offering of the Shares; and (D) such other Authorizations the absence of which would not,
individually or in the aggregate, have a Material Adverse Effect; and no event has occurred, nor is
any proceeding, to the best of the knowledge of the Company, pending or threatened, that allows or
results in, or after notice or lapse of time or both would allow or result in, revocation,
suspension, termination or invalidation of any such Authorization or any other impairment of the
rights of the holder or maker of any such Authorization;
(o) The Company has full corporate power and authority to enter into this Agreement. This
Agreement has been duly authorized, executed and delivered by the Company and constitutes a valid
and binding agreement of the Company, enforceable against the Company in accordance with the terms
hereof. All actions (including those of stockholders) necessary for the Company to consummate the
transactions contemplated in this Agreement have been taken and are in effect;
(p) The Company is not (A) in violation of its Certificate of Incorporation or By-laws or
other organizational documents or (B) in default in the performance or observance of any material
obligation, agreement, covenant or condition contained in any agreement or instrument to which it
is a party or by which it or any of its properties may be bound or affected or any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement, except for such violations or
defaults that would not, individually or in the aggregate, have a Material Adverse Effect. The
Company has in effect controls and procedures for ensuring compliance in all material respects with
any agreement or instrument to which it is a party or by which it or any of its properties may be
bound or affected or any indenture, mortgage, deed of trust, loan agreement, lease or other
agreement, except for such agreements the breach of which would not, individually or in the
aggregate, have a Material Adverse Effect;
(q) The statements that are set forth in the Pricing Prospectus, and that will be set forth in
the Prospectus, under the caption “Description of Capital Stock”, insofar as they purport to
constitute a summary of the terms of the Stock, and under the captions “Material U.S. Federal Tax
Considerations for Non-U.S. Holders of Our Common Stock” and “Underwriting”, insofar as they
purport to describe the provisions of the laws and documents referred to therein, are (in the case
of the Pricing Prospectus) or will be (in the case of the Prospectus), as the case may be,
accurate, complete and fair;
(r) Except as is disclosed in the Pricing Prospectus and will be disclosed in the Prospectus,
there are no legal or governmental proceedings pending to which the Company is a party or of which
any property of the Company is the subject which, if determined adversely to the Company, could
reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, or
would materially and adversely affect the ability of the Company to perform its obligations under
this Agreement, or which are otherwise material in the context of the sale of the Shares; and to
the best of the Company’s knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others;
(s) Except as is disclosed in the Pricing Prospectus, and will be disclosed in the Prospectus,
(i) the Company owns or possesses adequate rights to use all trademarks, trade names, inventions,
copyrights,
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know-how (including trade secrets and other unpatented and/or unpatentable proprietary
or confidential information, systems or procedures), licenses, approvals and governmental
authorizations to conduct its business as now conducted and none of the foregoing intellectual
property rights owned or possessed by the Company which is material to the Company is invalid or
unenforceable; to the Company’s knowledge, the Company is not infringing any third party’s patents
or patent applications; the Company is not infringing any third party’s trademarks, trade name
rights, inventions, copyrights, licenses, trade secrets or other similar rights of others, (iii)
the Company is not engaging in any improper use of data obtained by it from customers or other
third parties or through its own survey collection efforts, (iv) the Company is not aware of any
infringement, misappropriation or violation by others of, or conflict by others with rights of the
Company with respect to, any of the foregoing intellectual property rights, where such infringement
would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect,
and (v) there is no claim being made against the Company, or to the best of the Company’s
knowledge, any employee of the Company, regarding trademark, trade name, patent, inventions,
copyright, license, trade secret or other infringement or improper use of any data obtained by the
Company from third parties which would reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect. The Company has no patents or patent applications;
(t) All current employees, consultants and contractors of the Company have executed written
instruments with the Company that assign to the Company all rights, title and interest in and to
any and all (i) inventions, improvements, discoveries, writings and other works of authorship, and
information relating to the business of the Company or any of the products or services being
researched, developed or sold by the Company or that may be used with any such products or services
and (ii) any intellectual property and/or proprietary rights related thereto, including but not
limited to trademarks, trade names, patents, patent applications, inventions, copyrights and
know-how (including trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures). To the Company’s knowledge, all former
employees, consultants and contractors of the Company have executed written instruments with the
Company that assign to the Company all rights, title and interest in and to any and all (i)
inventions, improvements, discoveries, writings and other works of authorship, and information
relating to the business of the Company or any of the products or services being researched,
developed or sold by the Company or that may be used with any such products or services and (ii)
any intellectual property and/or proprietary rights related thereto, including but not limited to
trademarks, trade names, patents, patent applications, inventions, copyrights and know-how
(including trade secrets and other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), except to the extent that failure to execute such written
instruments would not have a Material Adverse Effect;
(u) Except as is disclosed in the Pricing Prospectus and will be disclosed in the Prospectus,
there are no contracts, agreements or understandings between the Company and any person that
materially restrict the Company’s ability to conduct its business as described in the Pricing
Prospectus;
(v) The Company possesses all certificates, certifications, registrations, notifications,
orders, licenses, authorizations, approvals and permits (collectively, “Permits”) issued by the
appropriate federal, state, local or foreign regulatory authorities necessary to conduct its
business and such Permits are valid
and in full force and effect, except for Permits where the failure to possess, or the
invalidity of which, individually or in the aggregate, would not have a Material Adverse Effect.
The Company is in compliance in all respects with the terms and conditions of such Permits, except
where the failure to comply would not have a Material Adverse Effect. The Company has not received
any notice of proceedings relating to the revocation or modification of any such Permit which,
individually or in the aggregate, if the subject of an unfavorable decision, ruling or finding,
would have a Material Adverse Effect;
(w) The Company is insured against such losses and risks and in such amounts as the Company
reasonably believes are prudent and customary in the business in which it is engaged; and the
Company does not have any reason to believe that it will not be able to renew its existing
insurance coverage as
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and when such coverage expires or to obtain similar coverage from similar
insurers as may be necessary to continue its business at a cost that would not have a Material
Adverse Effect;
(x) The Company (i) is in compliance with any and all applicable foreign, federal, state and
local laws and regulations relating to the protection of human health and safety, the environment
or hazardous or toxic substances or wastes, pollutants or contaminants (“Environmental Laws”), (ii)
has received all Permits required of it under applicable Environmental Laws to conduct its business
and (iii) is in compliance in all respects with any such Permit, except where such noncompliance
with Environmental Laws, failure to receive required Permits, or failure to comply with the terms
and conditions of such Permits would not have, individually or in the aggregate, a Material Adverse
Effect;
(y) There are no costs or liabilities associated with Environmental Laws (including, without
limitation, any capital or operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any Permit, any related constraints on operating activities
and any potential liabilities to third parties) which would, individually or in the aggregate, have
a Material Adverse Effect;
(z) The Company has filed all federal, state, local and foreign tax returns which have been
required to be filed and has paid or made provision to pay all taxes and assessments received by it
to the extent that such taxes or assessments have become due, except where the failure to file such
returns or pay, or make provision to pay, all such taxes and assessments would not have a Material
Adverse Effect. The Company does not have any tax deficiency which has been or, to the best of the
knowledge of the Company, might be asserted or threatened against it which would reasonably be
expected to have a Material Adverse Effect;
(aa) The Company’s liabilities to its customers are as set forth in the Company’s standard
form of Master Services Agreement and in the Prospectus, except as would not, individually or in
the aggregate, have a Material Adverse Effect;
(bb) The Company is not and, after giving effect to the offering and sale of the Shares and
the application of the proceeds thereof, will not be an “investment company”, as such term is
defined in the Investment Company Act of 1940, as amended;
(cc) At the time of filing the Initial Registration Statement, the Company was not an
“ineligible issuer,” as defined in Rule 405 under the Act;
(dd) Except as disclosed in the Pricing Prospectus, 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 or to require the Company to include such securities with the Shares registered pursuant to
the Initial Registration Statement other than as have been waived in writing in connection with the
offering contemplated hereby;
(ee) Xxxxx Xxxxxxxx LLP, who have certified certain financial statements of the Company and
its subsidiaries, are independent public accountants as required by the Act and the rules and
regulations of the Commission thereunder;
(ff) The financial statements of the Company (including all notes and schedules thereto)
included in the Registration Statement, the Pricing Prospectus and Prospectus comply in all
material respects with the requirements of the Act and the Exchange Act and present fairly the
financial position of the Company at the dates indicated and the statement of operations,
stockholders’ equity and cash flows of the Company for the periods specified are in conformity with
generally accepted accounting principles, consistently applied throughout the periods involved; and
the summary and selected financial data that are included in the Registration Statement and the
Pricing Prospectus and that will be included in the Prospectus, (i) are, in the case
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of the
financial information for the years ended December 31, 2007, December 31, 2008 and December 31,
2009, derived from the consolidated financial statements that are set forth in the Registration
Statement and the Pricing Prospectus and that will be set forth in the Prospectus, (ii) are, in the
case of financial information for the years ended December 31, 2005 and December 31, 2006, complete
and accurate in all respects and fairly present the financial condition of the Company at the
respective dates thereof and the results of the Company’s operations for the periods then ended and
were prepared in accordance with the books and records of the Company in conformity with generally
accepted accounting principles, consistently applied during the periods covered thereby except for
the omission of footnotes and normal year-end adjustments which are not, individually and in the
aggregate, material. All financial statements or schedules of the Company which are required by
the Act or the rules and regulations of the Commission thereunder to be included in the
Registration Statement, the Preliminary Prospectus or the Prospectus have been or, in the case of
the Prospectus, will be so included;
(gg) The Company is fully compliant in all respects with applicable laws, rules and
regulations of the Commission regarding internal control over financial reporting (as such term is
defined in Rule 13a-15(f) under the Exchange Act). Except as is disclosed in the Pricing
Prospectus and will be disclosed in the Prospectus, the Company is not aware of any material
weaknesses in its internal control over financial reporting;
(hh) Since the date of the latest audited financial statements of the Company included in the
Pricing Prospectus, there has been no change in the Company’s internal control over financial
reporting that has materially diminished, or is reasonably likely to materially diminish, the
effectiveness of the Company’s internal control over financial reporting (other than as set forth
in the Pricing Prospectus);
(ii) The Company maintains disclosure controls and procedures (as such term is defined in Rule
13a-15(e) under the Exchange Act) that comply with the requirements of the Exchange Act; such
disclosure controls and procedures have been designed to ensure that material information relating
to the Company is made known to the Company’s principal executive officer and principal financial
officer by others within the Company; and such disclosure controls and procedures are effective;
(jj) The Company is in compliance with all currently effective provisions of the
Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations promulgated thereunder that are
applicable, or will be applicable to the Company as of each Time of Delivery;
(kk) There are no off-balance sheet arrangements, outstanding guarantees or other contingent
obligations of the Company that could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect;
(ll) The Company’s Chief Executive Officer and Chief Financial Officer have reviewed and
agreed with the selection, application and disclosure of critical accounting policies and have
consulted with the Company’s independent registered public accounting firm with regard to such
disclosure;
(mm) No relationship, direct or indirect, exists between or among the Company, on the one
hand, and the directors, officers, stockholders, customers or suppliers of the Company, on the
other hand, which is required to be described in the Registration Statement, the Pricing Prospectus
and the Prospectus and which is not so described. There are no outstanding loans, advances or
guarantees of indebtedness by the Company to or for the benefit of any of the executive officers or
directors of the Company;
(nn) To the knowledge of the Company, no person associated with or acting on behalf of the
Company, including without limitation any director, officer, agent or employee of the Company has,
directly or indirectly, while acting on behalf of the Company (A) used any corporate funds for
unlawful contributions, gifts,
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entertainment or other unlawful expenses relating to political
activity, (B) made any unlawful payment to foreign or domestic government officials or employees or
to foreign or domestic political parties or campaigns from corporate funds, (C) violated any
provision of the Foreign Corrupt Practices Act of 1977, as amended or (D) made any other unlawful
payment;
(oo) Except as contemplated by this Agreement and as is disclosed in the Pricing Prospectus
and will be disclosed in the Prospectus, no person is entitled to receive from the Company a
brokerage commission, finder’s fee or other like payment in connection with the transactions
contemplated herein;
(pp) The Company does not conduct business with the government of, or with any person located
in any country in a manner that violates in any material respect any of the economic sanctions
programs or similar sanctions-related measures of the United States as administered by the United
States Treasury Department’s Office of Foreign Assets Control; and the net proceeds from this
offering will not be used to fund any operations in, finance any investments in or make any
payments to any country, or to make any payments to any person, in a manner that violates any of
the economic sanctions of the United States administered by the United States Treasury Department’s
Office of Foreign Assets Control;
(qq) There is no document, contract, permit or instrument of a character required to be
described in the Initial Registration Statement, the Pricing Prospectus or the Prospectus or to be
filed as an exhibit to the Initial Registration Statement which is not (or, in the case of the
Prospectus, will not be) described or filed as required. All such contracts described (or, in the
case of the Prospectus, to be described) in the Initial Registration Statement, the Pricing
Prospectus or the Prospectus or filed as exhibits to the Initial Registration Statement to which
the Company is a party have been duly authorized, executed and delivered by the Company, constitute
valid and binding agreements of the Company and are enforceable against and by the Company in
accordance with the terms thereof;
(rr) Except for stock issuances disclosed in the Initial Registration Statement, the Company
has not sold or issued any shares of Stock during the six-month period preceding the date of the
Prospectus, including any sales pursuant to Rule 144A, or Regulations D or S, under the Act, other
than any shares of Stock issued upon exercise of warrants and stock options granted pursuant to the
Company’s equity incentive plans, which warrants and equity incentive plans are described in the
Pricing Prospectus and will be described in the Prospectus;
(ss) Statistical, industry-related and market-related data included in the Initial
Registration Statement, the Pricing Prospectus and the Prospectus are (or, in the case of the
Prospectus, will be) based on or derived from sources which the Company reasonably and in good
faith believes are reliable and accurate in all material respects;
(tt) The Company has not distributed and will not distribute prior to the last Time of
Delivery and completion of the distribution of the Shares, any offering material in connection with
the offering and sale of the Shares other than any Preliminary Prospectuses, the Prospectus, the
Registration Statement and Issuer Free Writing Prospectuses listed in Schedule III hereto;
(uu) Neither the Company nor any of its directors, officers or controlling persons has taken,
directly or indirectly, any action designed, or which would reasonably be expected, to cause or
result, under the Act or otherwise, in, or which has constituted, stabilization or manipulation of
the price of any security of the Company;
(vv) (i) Each employee benefit plan, within the meaning of Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”), for which the Company or any member
of its “Controlled Group” (defined as any organization which is a member of a controlled group of
corporations
9
within the meaning of Section 414 of the Internal Revenue Code of 1986, as amended
(the “Code”)) would have any liability (each, a “Plan”) has been maintained in material compliance
with its terms and the requirements of any applicable statutes, orders, rules and regulations,
including but not limited to ERISA and the Code; (ii) no prohibited transaction, within the meaning
of Section 406 of ERISA or Section 4975 of the Code, has occurred with respect to any Plan
excluding transactions effected pursuant to a statutory or administrative exemption; (iii) for each
Plan that is subject to the funding rules of Section 412 of the Code or Section 302 of ERISA, no
material “accumulated funding deficiency” as defined in Section 412 of the Code, whether or not
waived, has occurred or is reasonably expected to occur; (iv) the fair market value of the assets
of each Plan exceeds the present value of all benefits accrued under such Plan (determined based on
those assumptions used to fund such Plan); (v) no “reportable event” (within the meaning of Section
4043(c) of ERISA) has occurred or is reasonably expected to occur; and (vi) neither the Company nor
any member of the Controlled Group has incurred, nor reasonably expects to incur, any material
liability under Title IV of ERISA (other than contributions to the Plan or premiums to the PBGC, in
the ordinary course and without default) in respect of a Plan (including a “multiemployer plan”,
within the meaning of Section 4001(a)(3) of ERISA);
(ww) The Company does not do business with the government of Cuba or with any person located
in Cuba within the meaning of Section 517.075, Florida Statutes;
(xx) Copies of the minute books of the Company have been furnished to counsel for the
Underwriters, and such books (i) contain all minutes and written actions of the board of directors
(including each committee thereof) of the Company prepared since the time of its incorporation and
(ii) accurately reflect all matters referred to in such minutes;
(yy) The Company has caused each of the parties named in Annex I hereto, including
each of the executive officers and directors of the Company and each of the Selling Stockholders,
to deliver to Xxxxxx, Xxxxxxxx & Company, Incorporated an agreement (each a “Lock-Up Agreement”)
that restricts transfers of securities of the Company and that is in a form previously provided, or
agreed upon, by Xxxxxx, Xxxxxxxx & Company, Incorporated;
(zz) The Company has no subsidiaries except for [Hong Kong Subsidiary]; and
(aaa) No forward-looking statement (within the meaning of Section 27A of the Securities Act
and Section 21E of the Exchange Act) made by the Company or any of its officers or directors
contained in the Registration Statement, the Prospectus or the Pricing Prospectus, or made
available to the public generally since April 22, 2010, has been made or reaffirmed without a
reasonable basis or has been disclosed other than in good faith.
2. Each of the Selling Stockholders severally and not jointly represents and warrants to,
and agrees with, each of the Underwriters that:
(a) All consents, approvals, authorizations and orders necessary for the execution and
delivery by such Selling Stockholder of this Agreement and the Power of Attorney and the Custody
Agreement hereinafter referred to, and for the sale and delivery of the Shares to be sold by such
Selling Stockholder hereunder, have been obtained; and such Selling Stockholder has full right,
power and authority to enter into this Agreement, the Power of Attorney and the Custody Agreement
to make the representations, warranties and agreements hereunder and thereunder and to sell,
assign, transfer and deliver the Shares to be sold by such Selling Stockholder hereunder;
(b) The sale of the Shares to be sold by such Selling Stockholder hereunder and the compliance
by such Selling Stockholder with all of the provisions of this Agreement, the Power of Attorney and
the Custody Agreement and the consummation of the transactions herein contemplated will not
conflict with or
10
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, or give rise to a right of termination under, or result in the
acceleration of any obligations under, any statute, indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which such Selling Stockholder is a party or by which
such Selling Stockholder is bound or affected or to which any of the property or assets of such
Selling Stockholder is subject or affected, nor will such action result in any violation of the
provisions of the Certificate of Incorporation or By laws of such Selling Stockholder if such
Selling Stockholder is a corporation, the Partnership Agreement of such Selling Stockholder if such
Selling Stockholder is a partnership, or any other organizational and/or governing document of such
Selling Stockholder if such Selling Stockholders is not a natural person, or any statute or any
order, rule or regulation of any court or governmental agency or body having jurisdiction over such
Selling Stockholder or the property of such Selling Stockholder, except for such breaches, defaults
or violations that would not have an adverse effect on the ability of such Selling Stockholder to
perform its obligations under this Agreement;
(c) Such Selling Stockholder has, and immediately prior to each Time of Delivery (as defined
in Section 4(a) hereof) such Selling Stockholder will have, good and valid title to the Shares to
be sold by such Selling Stockholder hereunder, free and clear of all liens, encumbrances, equities
or claims (other than pursuant to the Custody Agreement); and, upon delivery of such Shares and
payment therefor pursuant hereto, good and valid title to such Shares, free and clear of all liens,
encumbrances, equities or claims (other than pursuant to the Custody Agreement), will pass to the
several Underwriters;
(d) Such Selling Stockholder has not taken and will not take, directly or indirectly, any
action which is designed to or which has constituted or which might reasonably be expected to cause
or result in stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Shares;
(e) Such Selling Stockholder is not prompted by any material nonpublic information concerning
the Company or its subsidiaries which is not set forth in the Pricing Prospectus to sell its Shares
pursuant to this Agreement;
(f) To the extent that any statements or omissions made in the Registration Statement, any
Preliminary Prospectus, the Prospectus or any amendment or supplement thereto are made in reliance
upon and in conformity with written information furnished to the Company by such Selling
Stockholder expressly for use therein, such Preliminary Prospectus and the Registration Statement
did not, and the Prospectus and any further amendments or supplements to the Registration Statement
and the Prospectus, when they become effective or are filed with the Commission, as the case may
be, will not contain any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not misleading based on
the written information furnished to the Company by such Selling Stockholder expressly
for use therein. The Company and the Underwriters acknowledge that the information provided
by the Selling Stockholders in connection with preparing responses to Items 7 and 11(m) of Form S-1
constitute the only written information furnished to the Company by the Selling Stockholders for
use in the Registration Statement, any Preliminary Prospectus, the Prospectus or amendment thereto
for purposes of this Agreement;
(g) Each broadly available road show, if any, when considered together with the Pricing
Prospectus, does not contain any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided that the representations and warranties set forth in
this Section 2(g) are limited to statements or omissions made in reliance upon and in conformity
with written information furnished to the Company by such Selling Stockholder expressly for use in
the Registration Statement, any Preliminary Prospectus, the Prospectus or any amendment or
supplement thereto as set forth in Section 2(f);
11
(h) In order to document the Underwriters’ compliance with the reporting and withholding
provisions of the Tax Equity and Fiscal Responsibility Act of 1982 with respect to the transactions
herein contemplated, such Selling Stockholder will deliver to you prior to or at the First Time of
Delivery (as defined in Section 4(a) hereof) a properly completed and executed United States
Treasury Department Form W-9 (or other applicable form or statement specified by Treasury
Department regulations in lieu thereof);
(i) Certificates in negotiable form representing all of the Shares to be sold by such Selling
Stockholder hereunder have been placed in custody under a Custody Agreement, in the form heretofore
furnished to you (the “Custody Agreement”), duly executed and delivered by such Selling Stockholder
to the Company, as custodian (the “Custodian”), and such Selling Stockholder has duly executed and
delivered a Power of Attorney, in the form heretofore furnished to you (the “Power of Attorney”),
appointing Xxxxxx X. Black and Xxxxxxxx X. Xxxxxx, and each of them, as such Selling Stockholder’s
attorneys-in-fact (the “Attorneys-in-Fact”) with authority to execute and deliver this Agreement on
behalf of such Selling Stockholder, to determine the purchase price to be paid by the Underwriters
to the Selling Stockholders as provided in Section 3 hereof, to authorize the delivery of the
Shares to be sold by such Selling Stockholder hereunder and otherwise to act on behalf of such
Selling Stockholder in connection with the transactions contemplated by this Agreement and the
Custody Agreement; and
(j) The Shares represented by the certificates held in custody for such Selling Stockholder
under the Custody Agreement are for the benefit and coupled with and subject to the interests of
the Underwriters, the Custodian, the Attorneys-in-Fact, each other Selling Stockholder and the
Company; the arrangements made by such Selling Stockholder for such custody, and the appointment by
such Selling Stockholder of the Attorneys-in-Fact by the Power of Attorney, are to that extent
irrevocable; the obligations of the Selling Stockholders hereunder shall not be terminated by
operation of law, whether by the death or incapacity of any individual Selling Stockholder or, in
the case of an estate or trust, by the death or incapacity of any executor or trustee or the
termination of such estate or trust, or in the case of a partnership or corporation, by the
dissolution of such partnership or corporation, or by the occurrence of any other event; if any
individual Selling Stockholder or any such executor or trustee should die or become incapacitated,
or if any such estate or trust should be terminated, or if any such partnership or corporation
should be dissolved, or if any other such event should occur, before the delivery of the Shares
hereunder, certificates representing the Shares shall be delivered by or on behalf of the Selling
Stockholders in accordance with the terms and conditions of this Agreement and of the Custody
Agreements; and actions taken by the Attorneys-in-Fact pursuant to the Powers of Attorney shall be
as valid as if such death, incapacity, termination, dissolution or other event had not occurred,
regardless of whether or not the Custodian, the Attorneys-in-Fact, or any of them, shall have
received notice of such death, incapacity, termination, dissolution or other event.
3. Subject to the terms and conditions herein set forth,
(a) The Company and each of the Selling Stockholders agree, severally and not jointly, to sell
to each of the Underwriters, and each of the Underwriters agrees, severally and not jointly, to (i)
purchase from the Company and each of the Selling Stockholders, at a purchase price per share of
$[_____], the number of Firm Shares (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying the aggregate number of Firm Shares to be sold by the Company and each of
the Selling Stockholders as set forth opposite their respective names in Schedule II hereto
by a fraction, the numerator of which is the aggregate number of Firm Shares to be purchased by
such Underwriter as set forth opposite the name of such Underwriter in Schedule I hereto
and the denominator of which is the aggregate number of Firm Shares to be purchased by all of the
Underwriters from the Company and all of the Selling Stockholders hereunder and (ii) in the event
and to the extent that the Underwriters shall exercise the election to purchase Optional Shares as
provided below, the Company and the Selling Stockholders agree to sell to each of the Underwriters,
and each of the Underwriters agrees, severally and not jointly, to purchase from the Company and
the Selling Stockholders at the purchase price per share set forth in clause (i) of this Section
3(a), that portion of the number of Optional Shares as to
12
which such election shall have been
exercised (to be adjusted by you so as to eliminate fractional shares) determined by multiplying
such number of Optional Shares by a fraction the numerator of which is the maximum number of
Optional Shares which such Underwriter is entitled to purchase as set forth opposite the name of
such Underwriter in Schedule I hereto and the denominator of which is the maximum number of
Optional Shares that all of the Underwriters are entitled to purchase hereunder.
(b) The Company hereby grants to the Underwriters the right to purchase at their election up
to 15,000 Optional Shares and the Selling Stockholders hereby grant to the Underwriters the right
to purchase at their election up to [_______] Optional Shares, at the purchase price per share set
forth clause (i) of Section 3(a), for the sole purpose of covering sales of shares in excess of the
number of Firm Shares. Any such election to purchase Optional Shares may be exercised only by
written notice from you to the Company, given within a period of 30 calendar days after the date of
this Agreement and setting forth the aggregate number of Optional Shares to be purchased and the
date on which such Optional Shares are to be delivered, as determined by you but in no event
earlier than the First Time of Delivery (as defined in Section 4 hereof) or, unless you and the
Company otherwise agree in writing, earlier than two or later than ten business days after the date
of such notice.
4. Payment and Delivery.
(a) The Shares to be purchased by each Underwriter hereunder will be represented by one or
more definitive global Shares in book-entry form which will be deposited by or on behalf of the
Company with the Depository Trust Company (“DTC”) or its designated custodian. The Company and the
Custodian will deliver the Shares to Xxxxxx, Xxxxxxxx & Company, Incorporated, for the account of
each Underwriter, against payment by or on behalf of each such Underwriter of the purchase price
therefor by wire transfer of Federal (same-day) funds to the account specified by the Company and
each of the Selling Stockholders, as their interests may appear, by causing DTC to credit the
Shares to the account of Xxxxxx, Xxxxxxxx & Company, Incorporated at DTC. The time and date of
such delivery and payment shall be, with respect to the Firm Shares, 10:00 a.m., New York time, on
[________], 2010, or such other time and date as Xxxxxx, Xxxxxxxx & Company, Incorporated and the
Company may agree upon in writing, and, with respect to the Optional Shares, 10:00 a.m., New York
time, on the date specified by Xxxxxx, Xxxxxxxx & Company, Incorporated in the written notice given
by Xxxxxx, Xxxxxxxx & Company, Incorporated of the Underwriters’ election to purchase such Optional
Shares, or such other time and date as Xxxxxx, Xxxxxxxx & Company, Incorporated and the Company may
agree upon in writing. Such time and date for delivery of the Firm Shares is herein called the
"First Time of Delivery”, each such time and date for delivery of the Optional Shares, if not the
First Time of Delivery, is herein called an “Optional Time of Delivery”, and each such time and
date for delivery is herein called a “Time of Delivery”.
(b) The documents to be delivered at each Time of Delivery by or on behalf of the parties
hereto pursuant to Section 9 hereof, including the cross receipt for the Shares and any additional
documents
requested by the Underwriters pursuant to Section 9(q) hereof, will be delivered at the
offices of Xxxxxxx Procter LLP, 00 Xxxxx Xxxxxx, Xxxxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 (the
"Closing Location”), and the Shares will be delivered at the office of DTC or its designated
custodian, all at such Time of Delivery. A meeting will be held at the Closing Location at 5:00
p.m., New York City time, on the New York Business Day next preceding such Time of Delivery, at
which meeting the final drafts of the documents to be delivered pursuant to the preceding sentence
will be available for review by the parties hereto. For the purposes of this Agreement, “New York
Business Day” shall mean each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on
which banking institutions in New York City are generally authorized or obligated by law or
executive order to close.
5. Each of the Company and the Selling Stockholders acknowledges and agrees that (i) the
purchase and sale of the Shares pursuant to this Agreement is an arm’s-length commercial
transaction between the Company and the Selling Stockholders, on the one hand, and the several
Underwriters, on the other, (ii) in
13
connection therewith and with the process leading to such
transaction each Underwriter is acting solely as a principal and not the agent or fiduciary of the
Company or the Selling Stockholders, (iii) no Underwriter has assumed an advisory or fiduciary
responsibility in favor of the Company or the Selling Stockholders with respect to the offering
contemplated hereby or the process leading thereto (irrespective of whether such Underwriter has
advised or is currently advising the Company or the Selling Stockholders on other matters) or any
other obligation to the Company or the Selling Stockholders except the obligations expressly set
forth in this Agreement, (iv) the Underwriters and their respective affiliates may be engaged in a
broad range of transactions that involve interests that differ from those of the Company or any
Selling Stockholder and have no obligation to disclose or account to the Company or any Selling
Stockholder for any of such differing interests and (v) each of the Company and the Selling
Stockholders has consulted its own legal and financial advisors to the extent it deemed
appropriate. Each of the Company and the Selling Stockholders agrees that it will not claim that
the Underwriters, or any of them, has rendered advisory services of any nature or respect, or owes
a fiduciary or similar duty to the Company or the Selling Stockholders, in connection with such
transaction or the process leading thereto.
6. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file such Prospectus pursuant
to Rule 424(b) under the Act not later than the Commission’s close of business on the second
business day following the execution and delivery of this Agreement, or, if applicable, such
earlier time as may be required by Rule 430A(a)(3) under the Act; to make no further amendment or
any supplement to the Registration Statement or the Prospectus prior to the last Time of Delivery
which shall be disapproved by you promptly after reasonable notice thereof; to advise you, promptly
after it receives notice thereof, of the time when any amendment to the Registration Statement has
been filed or becomes effective or any supplement to the Prospectus or any amended Prospectus has
been filed and to furnish you with copies thereof; to advise you, promptly after it receives notice
thereof, of the happening of any event during the Prospectus Delivery Period (as defined in Section
6(c)) that in the judgment of the Company makes any statement made in the Registration Statement,
the Preliminary Prospectus or the Prospectus untrue or that requires the making of any changes in
the Registration Statement, the Preliminary Prospectus or the Prospectus in order to make the
statements therein, in the light of the circumstances in which they are made, not misleading; to
file promptly all material required to be filed by the Company with the Commission pursuant to Rule
433(d) under the Act; to advise you, promptly after it receives notice thereof, of the issuance by
the Commission of any stop order or of any order preventing or suspending the use of any
Preliminary Prospectus or other prospectus in respect of the Shares or to the best of the knowledge
of the Company the initiation or threatening of any proceeding for that purpose, of the suspension
of the qualification of the Shares for offering or sale in any jurisdiction, or to the best of the
knowledge of the Company the initiation or threatening of any proceeding for that purpose, of the
receipt of any notification with respect to the suspension of the Shares for quotation on The
NASDAQ Global Market (“Nasdaq") or to the best of the knowledge of the Company the initiation or
threatening of any proceeding for
that purpose or of any request by the Commission for the amending or supplementing of the
Registration Statement or the Prospectus or for additional information or any other purpose; and,
in the event of the issuance of any stop order or of any order preventing or suspending the use of
any Preliminary Prospectus or other prospectus or suspending any such qualification, to promptly
use its best efforts to obtain the withdrawal of such order. If the Company has omitted any
information from the Registration Statement pursuant to Rule 430A, the Company will comply with the
provisions of and make all requisite filings with the Commission pursuant to said Rule 430A and
notify Xxxxxx, Xxxxxxxx & Company, Incorporated promptly of all such filings;
(b) To promptly take such action as you may reasonably request to qualify the Shares for
offering and sale under the securities laws of such jurisdictions as you may request and to comply
with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions
for as long as may be necessary to complete the distribution of the Shares, provided that in
connection therewith the Company shall
14
not be required to qualify as a foreign corporation or to
file a general consent to service of process in any jurisdiction;
(c) On the second New York Business Day next succeeding the date of this Agreement and from
time to time, to furnish the Underwriters with written and electronic copies of the Prospectus in
New York City in such quantities as you may reasonably request, and, if the delivery of a
prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the Act) is required at
any time prior to the expiration of nine months after the time of issue of the Prospectus (the
"Prospectus Delivery Period”) in connection with the offering or sale of the Shares and if at such
time any events shall have occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus (or in lieu thereof, the notice referred to in Rule
173(a) under the Act) is delivered, not misleading, or, if for any other reason it shall be
necessary during such same period to amend or supplement the Prospectus in order to comply with the
Act, to notify you and upon your request prepare and duly file with the Commission an appropriate
supplement or amendment to the Prospectus which will correct such statement or omission or effect
such compliance and furnish without charge to each Underwriter and to any dealer in securities as
many written and electronic copies as you may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus, and in case any Underwriter is required to deliver a
prospectus (or in lieu thereof, the notice referred to in Rule 173(a) under the Act) in connection
with sales of any of the Shares at any time nine months or more after the time of issue of the
Prospectus, upon your request but at the expense of such Underwriter, to prepare and deliver to
such Underwriter as many written and electronic copies as you may request of an amended or
supplemented Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon as practicable, but in any
event not later than eighteen months after the effective date of the Registration Statement (as
defined in Rule 158(c) under the Act), an earning statement of the Company (which need not be
audited) complying with Section 11(a) of the Act and the rules and regulations of the Commission
thereunder (including Rule 158 of the Act);
(e) During the period beginning from the date hereof and continuing to and including the date
90 days after the date of the Prospectus (the “Initial Lock-Up Period”), not to offer, sell,
pledge, contract to sell or otherwise dispose of, except as provided hereunder, any securities of
the Company that are substantially similar to the Shares, including but not limited to any
securities that are convertible into or exchangeable for, or that represent the right to receive,
Stock or any such substantially similar securities (other than pursuant to employee stock option
plans existing on, or upon the exercise of warrants or the conversion or exchange of convertible or
exchangeable securities outstanding as of, the date of this Agreement), without your prior written
consent. Notwithstanding the foregoing, if (1) during the last 17 days of the initial Lock-Up
Period, the Company releases earnings results or announces material news or a material event or (2)
prior to the expiration of the initial Lock-Up Period, the Company announces that it will release
earnings results during the
16-day period following the last day of the initial Lock-Up Period, then in each case the
Lock-Up Period will be automatically extended until the expiration of the 18-day period beginning
on the date of release of the earnings results or the announcement of the material news or material
event, as applicable, unless Xxxxxx, Xxxxxxxx & Company, Incorporated waives, in writing, such
extension; the Company will provide Xxxxxx, Xxxxxxxx & Company, Incorporated and each stockholder
subject to a Lock-Up Agreement with prior notice of any such announcement that gives rise to an
extension of the Lock-Up Period. Xxxxxx, Xxxxxxxx & Company, Incorporated will provide the Company
with written notice of any extension of the Lock-Up Period; provided, however, that failure to
provide such notice shall not affect the effectiveness of such extension;
(f) Unless otherwise publicly available in electronic format on the website of the Company or
the Commission, to furnish to its stockholders as soon as practicable after the end of each fiscal
year an annual report (including a balance sheet and statements of income, stockholders’ equity and
cash flows of the
15
Company certified by independent public accountants) and, as soon as practicable
after the end of each of the first three quarters of each fiscal year (beginning with the fiscal
quarter ending after the effective date of the Registration Statement), to make available to its
stockholders consolidated summary financial information of the Company and its subsidiaries for
such quarter in reasonable detail;
(g) During a period of five years from the effective date of the Registration Statement,
unless otherwise publicly available in electronic format on the website of the Company or the
Commission, to furnish to you copies of all reports or other communications (financial or other)
furnished to stockholders, and to deliver to you (i) as soon as they are available, copies of any
reports and financial statements furnished to or filed with the Commission or any national
securities exchange on which any class of securities of the Company is listed; and (ii) such
additional information concerning the business and financial condition of the Company as you may
from time to time reasonably request (such financial statements to be on a consolidated basis to
the extent the accounts of the Company are consolidated in reports furnished to its stockholders
generally or to the Commission);
(h) To use the net proceeds received by it from the sale of the Shares pursuant to this
Agreement in the manner specified in the Pricing Prospectus, and will be specified in the
Prospectus, under the caption “Use of Proceeds”;
(i) During the Prospectus Delivery Period, the Company shall file, on a timely basis, with the
Commission and Nasdaq all reports and documents required to be filed under the Exchange Act;
(j) If the Company elects to rely upon Rule 462(b), to file a Rule 462(b) Registration
Statement with the Commission within the time required by, and otherwise in compliance with, Rule
462(b), and at the time of filing either pay to the Commission the filing fee for the Rule 462(b)
Registration Statement or give irrevocable instructions for the payment of such fee pursuant to
Rule 111(b) under the Act;
(k) To refrain from taking at any time, directly or indirectly, any action designed or that
might reasonably be expected to cause or result in, or that will constitute, stabilization of the
price of the shares of any security of the Company;
(l) Except as otherwise required by law (as determined in the reasonable judgment of the
Company and its counsel), prior to the last Time of Delivery, to refrain from issuing any press
release, directly or indirectly, or holding any press conference, in each case with respect to the
Company’s financial condition, earnings, business, operations or prospects, or the offering of the
Shares, without the prior written consent of Xxxxxx, Xxxxxxxx & Company, Incorporated; and
(m) Upon request of any Underwriter, to furnish, or cause to be furnished, to such Underwriter
an electronic version of the Company’s trademarks, servicemarks and corporate logo for use on the
website, if any, operated by such Underwriter for the purpose of facilitating the on-line
offering of the Shares (the “License”); provided, however, that the License shall be used solely
for the purpose described above, is granted without any fee and may not be assigned or transferred.
7. (a) The Company represents and agrees that, without the prior written consent of Xxxxxx,
Xxxxxxxx & Company, Incorporated, it has not made and will not make any offer relating to the
Shares that would constitute a “free writing prospectus” as defined in Rule 405 under the Act; each
Underwriter represents and agrees that, without the prior consent of the Company and Xxxxxx,
Xxxxxxxx & Company, Incorporated, it has not made and will not make any offer relating to the
Shares that would constitute a free writing prospectus; any such free writing prospectus the use of
which has been consented to by the Company and Xxxxxx, Xxxxxxxx & Company, Incorporated is listed
on Schedule III hereto.
16
(b) The Company has complied and will comply with the requirements of Rule 433 under the Act
applicable to any Issuer Free Writing Prospectus, including timely filing with the Commission or
retention where required and legending; and the Company represents that it has satisfied and agrees
that it will satisfy the conditions under Rule 433 under the Act to avoid a requirement to file
with the Commission any electronic road show.
(c) The Company agrees that if at any time following issuance of an Issuer Free Writing
Prospectus any event occurred or occurs as a result of which such Issuer Free Writing Prospectus
would conflict with the information in the Registration Statement, the Pricing Prospectus or the
Prospectus or would include an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the circumstances then
prevailing, not misleading, the Company will give prompt notice thereof to Xxxxxx, Xxxxxxxx &
Company, Incorporated and, if requested by Xxxxxx, Xxxxxxxx & Company, Incorporated, will prepare
and furnish without charge to each Underwriter an Issuer Free Writing Prospectus or other document
which will correct such conflict, statement or omission; provided, however, that this
representation and warranty shall not apply to any statements or omissions in an Issuer Free
Writing Prospectus made in reliance upon and in conformity with information furnished in writing to
the Company by an Underwriter through Xxxxxx, Xxxxxxxx & Company, Incorporated expressly for use
therein, it being understood and agreed that the only such information is that described in Section
10(d) hereof.
8. Whether or not the transactions contemplated by this Agreement are consummated or this
Agreement is terminated, the Company and each of the Selling Stockholders covenant and agree with
one another and with the several Underwriters that (a) the Company and such Selling Stockholder
will pay or cause to be paid a pro rata share (based on the number of Shares to be sold by the
Company and such Selling Stockholder hereunder) of the following: (i) the fees, disbursements and
expenses of the Company’s counsel and accountants in connection with the registration of the Shares
under the Act and all other expenses in connection with the preparation, printing, reproduction and
filing of the Registration Statement, any Preliminary Prospectus, any Issuer Free Writing
Prospectus and the Prospectus and amendments and supplements thereto and the mailing and delivering
of copies thereof to the Underwriters and dealers; (ii) the cost, other than the fees of counsel to
the Underwriters, of printing or producing this Agreement, the Custody Agreement, the Power of
Attorney, closing documents (including any compilations thereof) and any other documents in
connection with the offering, purchase, sale and delivery of the Shares; (iii) all expenses in
connection with the qualification of the Shares for offering and sale under state securities laws
as provided in Section 6(b) hereof, including the fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the Blue Sky survey; (iv)
all fees and expenses in connection with listing the Shares on Nasdaq; (v) the filing fees of the
Commission and all expenses associated with transmitted documents to the Commission in connection
with the offering of the Shares; and (vi) the filing fees incident to, and the fees and
disbursements of counsel for the Underwriters in connection with, securing the review by FINRA of
the terms of the sale of the Shares; (b) the Company will pay or cause to be paid: (i) the cost of
preparing stock certificates; (ii) the cost and charges of the transfer agent or registrar for the
Stock and (iii) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically provided for in
this Section; (c) such Selling Stockholder will pay or cause to be paid all costs and expenses
incident to the performance of such Selling Stockholder’s obligations hereunder which are not
otherwise specifically provided for in this Section, including (i) any fees and expenses of counsel
for such Selling Stockholder, the Attorneys-in-Fact and the Custodian, and (ii) all expenses and
taxes incident to the sale and delivery of the Shares to be sold by such Selling Stockholder to the
Underwriters hereunder; and (d) the Company and the Underwriters shall pay or cause to be paid
their own respective expenses incurred for lodging and travel in connection with conducting the
road show, however any expenses incurred for chartered travel for the road show taken jointly by
Company employees and the Underwriters shall be borne equally by the Company and the Underwriters.
In connection with clause (c)(ii) of the preceding sentence, Xxxxxx, Xxxxxxxx & Company,
Incorporated agrees to pay New York State stock transfer tax, and each Selling Stockholder agrees
to reimburse Xxxxxx, Xxxxxxxx & Company, Incorporated for associated carrying costs if such tax
payment is not rebated on the day of payment and for any
17
portion of such tax payment not rebated
and to comply with applicable tax laws. The Underwriters may deem the Company to be the primary
obligor with respect to all costs, fees and expenses to be paid by the Company and by the Selling
Stockholders pursuant to this Section 8. It is understood, however, that the Company shall pay, or
reimburse Selling Stockholders for, any fees and expenses otherwise payable under subsection (a)
hereof. It is further understood, however, that the Company shall bear, and the Selling
Stockholders shall not be required to pay or to reimburse the Company for, the cost of any other
matters not directly relating to the sale and purchase of the Shares pursuant to this Agreement,
and that, except as provided in this Section, and Sections 10 and 13 hereof, the Underwriters will
pay all of their own costs and expenses, including the fees of their counsel, stock transfer taxes
on resale of any of the Shares by them, and any advertising expenses connected with any offers they
may make.
9. The obligations of the Underwriters hereunder, as to the Shares to be delivered at each
Time of Delivery, shall be subject to the following conditions:
(a) All representations and warranties and other statements of the Company and the Selling
Stockholders herein are, at and as of such Time of Delivery, true and correct;
(b) The Company and the Selling Stockholders shall have performed and complied with all of its
and their covenants, agreements and obligations hereunder;
(c) The Prospectus shall have been filed with the Commission pursuant to Rule 424(b) under the
Act within the applicable time period prescribed for such filing by the rules and regulations under
the Act and in accordance with Section 6(a) hereof; all material required to be filed by the
Company pursuant to Rule 433(d) under the Act shall have been filed with the Commission within the
applicable time period prescribed for such filing by Rule 433; if the Company has elected to rely
upon Rule 462(b) under the Act, the Company shall file a Rule 462(b) Registration Statement with
the Commission within the time required by, and otherwise in compliance with, Rule 462(b), and the
Company shall at the time of filing either pay to the Commission the filing fee for the Rule 462(b)
Registration Statement or give irrevocable instructions for the payment of such fee pursuant to
Rule 111(b) under the Act; no stop order suspending the effectiveness of the Registration Statement
or any part thereof shall have been issued and no proceeding for that purpose shall, to the best of
the knowledge of the Company, have been initiated or threatened by the Commission; no stop order
suspending or preventing the use of the Prospectus or any Issuer Free Writing Prospectus shall have
been initiated or threatened by the Commission; and all requests for additional information on the
part of the Commission shall have been complied with to your reasonable satisfaction;
(d) Xxxxxxx Procter LLP, counsel for the Underwriters, shall have furnished to you such
written opinion or opinions, dated such Time of Delivery, in form and substance reasonably
acceptable to you;
(e) Faegre & Xxxxxx LLP, counsel for the Company, shall have furnished to you their written
opinion and letter, dated such Time of Delivery, in the forms attached as Annex II(a)
hereto;
(f) The respective counsel for each of the Selling Stockholders, as indicated in Schedule
II hereto, each shall have furnished to you their written opinion with respect to each of the
Selling Stockholders for whom they are acting as counsel (a draft of each such opinion is attached
as Annex II(b) hereto), dated such Time of Delivery, in form and substance satisfactory to
you;
(g) Concurrently with the execution of this Agreement and also at each Time of Delivery, Xxxxx
Xxxxxxxx LLP shall have furnished to you a letter or letters, dated the respective dates of
delivery thereof, in form and substance reasonably satisfactory to you, containing statements and
information of the type customarily included in accountants’ “comfort letters” to underwriters with
respect to the financial statements
18
and certain financial information contained in the Registration
Statement and the Prospectus and shall use a “cut off” date no more than three business days prior
to such Time of Delivery;
(h) (i) The Company has not sustained since the date of the latest audited financial
statements included in the Pricing Prospectus any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute
or court or governmental action, order or decree, otherwise than as set forth or contemplated in
the Pricing Prospectus, and (ii) since the respective dates as of which information is given in the
Pricing Prospectus there shall not have been any change in the capital stock or long-term debt of
the Company or any of its subsidiaries or any change, or any development involving a prospective
change, in or affecting the business, operations, management, assets, condition (financial or
otherwise) or results of operations of the Company, otherwise than as set forth or contemplated in
the Pricing Prospectus, the effect of which, in any such case described in clause (i) or (ii), is
in the judgment of Xxxxxx, Xxxxxxxx & Company, Incorporated so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the delivery of the Shares
being delivered at such Time of Delivery on the terms and in the manner contemplated in the Pricing
Prospectus;
(i) On or after the Applicable Time there shall not have occurred any of the following: (i)
trading in securities generally on the New York Stock Exchange, the NASDAQ Stock Market or the NYSE
Amex or in the over-the-counter market shall have been suspended or minimum or maximum prices or
maximum ranges for prices shall have been established on any such exchange or such market by the
Commission, by such exchange or by any other regulatory body or governmental authority having
jurisdiction, (ii) a banking moratorium shall have been declared by Federal or state authorities or
a material disruption has occurred in commercial banking or securities settlement or clearance
services in the United States, (iii) (A) the United States shall have become engaged in
hostilities, or the subject of an act of terrorism, there shall have been a material escalation in
hostilities involving the United States or there shall have been a declaration of a national
emergency or war by the United States or (B) there shall have occurred such a material adverse
change in general economic, political or financial conditions (or the effect of international
conditions on the financial markets in the United States shall be such) as to make it with respect
to either (A) or (B), in the sole judgment of Xxxxxx, Xxxxxxxx & Company, Incorporated,
impracticable or inadvisable to proceed with the sale or delivery of the Shares;
(j) The Shares to be sold at such Time of Delivery shall have been duly listed, subject to
notice of issuance, on Nasdaq;
(k) The Company shall have (i) obtained and delivered to the Underwriters executed copies of
Lock-Up Agreements from each of the parties named on Annex I hereto and (ii) provided to
the transfer agent and registrar for the Stock a written order, in a form reasonably acceptable to
Xxxxxx, Xxxxxxxx & Company, Incorporated, instructing such transfer agent and registrar not to
effect any transfer of stock that would be inconsistent with the terms of a Lock-Up Agreement
delivered by any of the parties named on Annex I hereto;
(l) The Company shall have complied with the provisions of Section 6(c) hereof with respect to
the furnishing of prospectuses on the New York Business Day next succeeding the date of this
Agreement;
(m) The Company shall have furnished or caused to be furnished to you at such Time of Delivery
certificates of officers of the Company satisfactory to you certifying as to the accuracy of the
representations and warranties of the Company and the Selling Stockholders herein at and as of such
Time of Delivery, as to the performance by the Company of all of its respective obligations
hereunder to be performed at or prior to such Time of Delivery, and as to such other matters as you
may reasonably request;
19
(n) Each of the Selling Stockholders shall have furnished or caused to be furnished to you at
such Time of Delivery certificates of officers of the Selling Stockholders substantially in the
form attached hereto as Annex III;
(o) FINRA shall have raised no objection to the fairness and reasonableness of the
underwriting terms and arrangements;
(p) A certificate signed by the Secretary or Assistant Secretary of the Company dated each
Time of Delivery certifying: (i) that the By-Laws and Amended and Restated Certificate of
Incorporation of the Company are true and complete, have not been modified and are in full force
and effect, (ii) that the resolutions relating to the offering contemplated by this Agreement are
in full force and effect and have not been modified, (iii) all correspondence between the Company
or its counsel and the Commission (attached to the certificate) and (iv) as to the incumbency of
the officers of the Company; and
(q) At each Time of Delivery, the Underwriters and counsel for the Underwriters shall have
received all such information, documents and opinions as they may reasonably request for the
purpose of enabling them to pass upon the issuance and sale of the Shares as contemplated herein or
in order to evidence the accuracy of any of the representations and warranties or the satisfaction
of any of the conditions or agreements herein contained.
10. (a) The Company will indemnify and hold harmless each Underwriter, and each of their
respective directors and officers, and any person who controls or is alleged to control an
Underwriter within the meaning of Section 15 of the Act or Section 20 of the Exchange Act, against
any losses, claims, damages or liabilities, joint or several, to which such Underwriter may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based in whole or in part upon (i) an untrue
statement or alleged untrue statement of a material fact contained in the Registration Statement,
any Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or any amendment or
supplement thereto, or any Issuer Free Writing Prospectus or 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 are made, or (ii) any
inaccuracy in the representations and warranties of the Company contained herein or any failure of
the Company to perform its obligations hereunder or under the law in connection with the
transactions contemplated by this Agreement, and will reimburse each Underwriter for any legal or
other expenses reasonably incurred by such Underwriter in connection with investigating or
defending any such action or claim as such expenses are incurred; provided,
however, that the Company shall not be liable in any such case to any Underwriter 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 or omission or alleged omission made in the Registration
Statement, any Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or any amendment
or supplement thereto, or any Issuer Free Writing Prospectus, in reliance upon and in conformity
with written information furnished to the Company by any Underwriter through Xxxxxx, Xxxxxxxx &
Company, Incorporated expressly for use therein, it being understood and agreed that the only such
information is that described in Section 10(d) hereof and provided, further, that
the Company shall not be liable in any such case to
any Underwriter with respect to any untrue statement or omission of a material fact if, (i)
prior to the Time of Sale the Company shall have notified Xxxxxx, Xxxxxxxx & Company, Incorporated
in writing in accordance with Section 14 hereof that the Registration Statement, any Preliminary
Prospectus, the Pricing Prospectus or the Prospectus, or any amendment or supplement thereto, or
any Issuer Free Writing Prospectus contains an untrue statement or alleged untrue statement of
material fact or omits or allegedly omits to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, (ii) such untrue statement,
alleged untrue statement, omission or alleged omission of a material fact was corrected in an
amendment or supplement and such amendment or supplement was provided to the Underwriters prior to
the Applicable Time, and (iii) the information contained in such corrected disclosure was not
conveyed at or prior to the Applicable Time.
20
(b) [Intentionally left blank]
(c) Each of the Selling Stockholders will, severally and not jointly, indemnify and hold
harmless the Company, each Underwriter and each of their respective directors and officers, and any
person who controls or is alleged to control an Underwriter or the Company within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, against any losses, claims, damages or
liabilities to which the Company or such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based in whole or in part upon (i) an untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement, any Preliminary Prospectus,
the Pricing Prospectus or the Prospectus, or any amendment or supplement thereto, or any Issuer
Free Writing Prospectus or 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 are made, or (ii) any inaccuracy in the representations and
warranties of such Selling Stockholder contained herein or any failure of such Selling Stockholder
to perform its obligations hereunder or under law in connection with the transactions contemplated
by this Agreement, in each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in the Registration Statement,
any Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or any amendment or
supplement thereto, or any Issuer Free Writing Prospectus, in reliance upon and in conformity with
information relating to a Selling Stockholder furnished to the Company in writing by such Selling
Stockholder or counsel therefor expressly for use therein; and will reimburse the Company and each
Underwriter for any legal or other expenses reasonably incurred by the Company or such Underwriter
in connection with investigating or defending any such action or claim as such expenses are
incurred. Notwithstanding the foregoing, a Selling Stockholder shall not be liable in any such
case to the Company or any Underwriter with respect to any untrue statement or omission of a
material fact if, (i) prior to the Time of Sale the Selling Stockholder shall have notified the
Company and Xxxxxx, Xxxxxxxx & Company, Incorporated in writing in accordance with Section 14
hereof that the Registration Statement, any Preliminary Prospectus, the Pricing Prospectus or the
Prospectus, or any amendment or supplement thereto, or any Issuer Free Writing Prospectus contains
an untrue statement or alleged untrue statement of material fact or omits or allegedly omits to
state therein a material fact required to be stated therein or necessary to make the statements
therein not misleading, (ii) such untrue statement, alleged untrue statement, omission or alleged
omission of a material fact was corrected in an amendment or supplement and such amendment or
supplement was provided to the Company and the Underwriters prior to the Applicable Time, and (iii)
the information contained in such corrected disclosure was not conveyed at or prior to the
Applicable Time.
(d) Each Underwriter will indemnify and hold harmless the Company, each Selling Stockholder
and each of their respective directors and officers, and any person who controls or is alleged to
control the Company or a Selling Stockholder within the meaning of Section 15 of the Act or Section
20 of the Exchange Act, against any losses, claims, damages or liabilities to which the Company or
such Selling Stockholder may become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement, any Preliminary
Prospectus, the Pricing Prospectus or the Prospectus, or any amendment or supplement thereto, or
any Issuer Free Writing Prospectus, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or necessary to make the
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 omission was made in the
Registration Statement, any Preliminary Prospectus, the Pricing Prospectus or the Prospectus, or
any amendment or supplement thereto, or any Issuer Free Writing Prospectus, in reliance upon and in
conformity with written information furnished to the Company by such Underwriter through Xxxxxx,
Xxxxxxxx & Company, Incorporated expressly for use therein; and will reimburse the Company and each
Selling Stockholder for any legal or other expenses reasonably incurred by the Company or such
Selling Stockholder in connection with investigating or defending any such action or claim as such
expenses are incurred. The Company and the
21
Selling Stockholders acknowledge that (i) the
statements set forth in the section titled “Commissions and Discounts” under the heading
“Underwriting” in the Registration Statement, Preliminary Prospectus, Pricing Prospectus and the
Prospectus and (ii) the list of the number of Shares purchased by each Underwriter set forth under
the heading “Underwriting” in the Registration Statement, Preliminary Prospectus, Pricing
Prospectus and the Prospectus constitute the only information relating to any Underwriter furnished
in writing to the Company by Xxxxxx, Xxxxxxxx & Company, Incorporated on behalf of the Underwriters
expressly for inclusion in the Registration Statement, any Preliminary Prospectus, the Pricing
Prospectus, the Prospectus or any Issuer Free Writing Prospectus.
(e) Promptly after receipt by an indemnified party under subsection (a), (c) or (d) above of
notice of the commencement of any action, such indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party under such subsection, notify the indemnifying
party in writing of the commencement thereof; but the omission to so notify the indemnifying party
shall not relieve it from any liability which it may have to any indemnified party otherwise than
under such subsection. In case any such action shall be brought against any indemnified party and
it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with counsel satisfactory to
such indemnified party (who shall not, except with the consent of the indemnified party, be counsel
to the indemnifying party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall not be liable to
such indemnified party under such subsection for any legal expenses of other counsel or any other
expenses, in each case subsequently incurred by such indemnified party, in connection with the
defense thereof other than reasonable costs of investigation; provided, however that the reasonable
fees, disbursements and other charges of counsel will be at the expense of the indemnifying party
or parties if (i) the employment of counsel by the indemnified party has been authorized in writing
by the indemnifying party, (ii) the indemnified party has reasonably concluded (based on advice of
counsel) that there may be legal defenses available to it or other indemnified parties that are
different from or in addition to those available to the indemnifying party, (iii) a conflict or
potential conflict exists (based on advice of counsel to the indemnified party) between the
indemnified party and the indemnifying party (in which case the indemnifying party will not have
the right to direct the defense of such action on behalf of the indemnified party), or (iv) the
indemnifying party has not in fact employed counsel reasonably satisfactory to the indemnified
party to assume the defense of such action within a reasonable time after receiving notice of the
commencement of the actions. It is understood that the indemnifying party or parties shall not, in
connection with any proceeding or related proceedings in the same jurisdiction, be liable for the
reasonable fees, disbursements and other charges of more than one separate firm admitted to
practice in such jurisdiction at any one time for all such indemnified party or parties. All such
fees, disbursements and other charges will be reimbursed by the indemnifying party promptly as they
are incurred. No indemnifying party shall, without the written consent of the indemnified party,
effect the settlement or compromise of, or consent to the entry of any judgment with respect to,
any pending or threatened action or claim in respect of which indemnification or contribution may
be sought hereunder (whether or not the indemnified party is an actual or potential party to such
action or claim) unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability arising out of such action
or claim and (ii) does not include a statement as to or an admission of fault, culpability or a
failure to act, by or on behalf of any indemnified party.
(f) If the indemnification provided for in this Section 10 is unavailable to or insufficient
to hold harmless an indemnified party under subsection (a), (c) or (d) above in respect of any
losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then
each indemnifying party shall contribute to the amount paid or payable by such indemnified party as
a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received by the Company and the
Selling Stockholders on the one hand and the Underwriters on the other from the offering of the
Shares. If, however, the allocation provided by the immediately preceding sentence is not
22
permitted by applicable law or if the indemnified party failed to give the notice required under
subsection (e) above, then each indemnifying party shall contribute to such amount paid or payable
by such indemnified party in such proportion as is appropriate to reflect not only such relative
benefits but also the relative fault of the Company and the Selling Stockholders on the one hand
and the Underwriters on the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative benefits received by the Company and the Selling
Stockholders on the one hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting expenses) received by the
Company and the Selling Stockholders bear to the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault 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 the Company or the Selling Stockholders on
the one hand or the Underwriters on the other and the parties’ relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or omission. The Company, each
of the Selling Stockholders and the Underwriters agree that it would not be just and equitable if
contributions pursuant to this subsection (f) 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 above in this subsection
(f). The amount paid or payable by an indemnified party as a result of the losses, claims, damages
or liabilities (or actions in respect thereof) referred to above in this subsection (f) shall be
deemed to include any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (f), 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 which such
Underwriter has 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 (f)
to contribute are several in proportion to their respective underwriting obligations and not joint.
(g) The obligations of the Company and the Selling Stockholders under this Section 10 shall be
in addition to any liability which the Company and the respective Selling Stockholders may
otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Act; and the obligations of the Underwriters
under this Section 10 shall be in addition to any liability which the respective Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to each officer and director
of the Company (including any person who, with his or her consent, is named in the Registration
Statement as about to become a director of the Company) and to each person, if any, who controls
the Company or any Selling Stockholder within the meaning of the Act.
(h) The liability of each Selling Stockholder under the indemnity and contribution provisions
of this Section 10 shall be limited to an amount equal to the public offering price of the Shares
sold
by such Selling Stockholder, less the underwriting discount, as set forth on the front cover
page of the Prospectus.
11. (a) If any Underwriter shall default in its obligation to purchase the Shares which it has
agreed to purchase hereunder at a Time of Delivery, you may in your discretion arrange for you or
another party or other parties to purchase such Shares on the terms contained herein. If within
thirty-six hours after such default by any Underwriter you do not arrange for the purchase of such
Shares, then the Company and the Selling Stockholders shall be entitled to a further period of
thirty-six hours within which to procure another party or other parties satisfactory to you to
purchase such Shares on such terms. In the event that, within the respective prescribed periods,
you notify the Company and the Selling Stockholders that you have so arranged for the purchase of
such Shares, or the Company and the Selling Stockholders notify you that they have so
23
arranged for
the purchase of such Shares, you or the Company and the Selling Stockholders shall have the right
to postpone a Time of Delivery for a period of not more than seven days, in order to effect
whatever changes may thereby be made necessary in the Registration Statement or the Prospectus, or
in any other documents or arrangements, and the Company agrees to file promptly any amendments or
supplements to the Registration Statement or the Prospectus which in your opinion may thereby be
made necessary. The term “Underwriter” as used in this Agreement shall include any person
substituted under this Section with like effect as if such person had originally been a party to
this Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of the Shares of a defaulting
Underwriter or Underwriters by you and the Company and the Selling Stockholders as provided in
subsection (a) above, the aggregate number of such Shares which remains unpurchased does not exceed
one-eleventh of the aggregate number of all the Shares to be purchased at such Time of Delivery,
then the Company and the Selling Stockholders shall have the right to require each non-defaulting
Underwriter to purchase the number of Shares which such Underwriter agreed to purchase hereunder at
such Time of Delivery and, in addition, to require each non-defaulting Underwriter to purchase its
pro rata share (based on the number of Shares which such Underwriter agreed to purchase hereunder)
of the Shares of such defaulting Underwriter or Underwriters for which such arrangements have not
been made; but nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of the Shares of a defaulting
Underwriter or Underwriters by you and the Company and the Selling Stockholders as provided in
subsection (a) above, the aggregate number of such Shares which remains unpurchased exceeds
one-eleventh of the aggregate number of all of the Shares to be purchased at such Time of Delivery,
or if the Company and the Selling Stockholders shall not exercise the right described in subsection
(b) above to require non-defaulting Underwriters to purchase Shares of a defaulting Underwriter or
Underwriters, then this Agreement (or, with respect to an Optional Time of Delivery, the
obligations of the Underwriters to purchase and of the Company and the Selling Stockholders to sell
the Optional Shares) shall thereupon terminate, without liability on the part of any non-defaulting
Underwriter, the Company or the Selling Stockholders, except for the expenses to be borne by the
Company, the Selling Stockholders and the Underwriters as provided in Section 8 hereof and the
indemnity and contribution agreements in Section 10 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
12. The respective indemnities, agreements, representations, warranties and other statements
of the Company, the Selling Stockholders and the several Underwriters, as set forth in this
Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall remain
in full force and effect, regardless of any investigation (or any statement as to the results
thereof) made by or on behalf of any Underwriter or any controlling person of any Underwriter, or
the Company, or any of the Selling Stockholders, or any officer or director or controlling person
of the Company, or any controlling person of any Selling Stockholder, and shall survive delivery of
and payment for the Shares.
13. If this Agreement shall be terminated pursuant to Section 11 hereof, neither the Company
nor the Selling Stockholders shall then be under any liability to any Underwriter except as
provided in Sections 10 and 13 hereof; but, if for any other reason any Shares are not delivered by
or on behalf of the Company and the Selling Stockholders as provided herein, the Company will
reimburse the Underwriters through you for all out-of-pocket expenses approved in writing by you,
including fees and disbursements of counsel, reasonably incurred by the Underwriters in making
preparations for the purchase, sale and delivery of the Shares not so delivered, but the Company
and the Selling Stockholders shall then be under no further liability to any Underwriter in respect
of the Shares not so delivered except as provided in Sections 10 and 13 hereof.
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14. In all dealings hereunder, you shall act on behalf of each of the Underwriters, and
the parties hereto shall be entitled to act and rely upon any statement, request, notice or
agreement on behalf of any Underwriter made or given by the Underwriters jointly or by Xxxxxx,
Xxxxxxxx & Company, Incorporated. on behalf of the Underwriters as the representative; and in all
dealings with any Selling Stockholder hereunder, you and the Company shall be entitled to act and
rely upon any statement, request, notice or agreement on behalf of such Selling Stockholder made or
given by any or all of the Attorneys-in-Fact for such Selling Stockholder.
All statements, requests, notices and agreements hereunder shall be in writing, and if to the
Underwriters shall be delivered or sent by mail, telex or facsimile transmission to you as the
representative in care of Xxxxxx, Xxxxxxxx & Company, Incorporated, Xxx Xxxxxxxxxx Xxxxxx, Xxxxx
0000, Xxx Xxxxxxxxx, XX 00000, Attention: General Counsel; if to any Selling Stockholder shall be
delivered or sent by mail, telex or facsimile transmission to counsel for such Selling Stockholder
at its address set forth in Schedule II hereto; and if to the Company shall be delivered or
sent by mail, telex or facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: Secretary; provided, however, that any notice to an Underwriter
pursuant to Section 10(e) hereof shall be delivered or sent by mail, telex or facsimile
transmission to such Underwriter at its address set forth in its Underwriters’ Questionnaire or
telex constituting such Questionnaire, which address will be supplied to the Company or the Selling
Stockholders by you on request; if to any other signatory to a Lock-Up Agreement referred to in
Section 9(k), to the address listed on the signature page thereto. Any such statements, requests,
notices or agreements shall take effect upon receipt thereof.
15. This Agreement shall be binding upon, and inure solely to the benefit of, the
Underwriters, the Company and the Selling Stockholders and, to the extent provided in Sections 10
and 12 hereof, the officers and directors of the Company and each person who controls the Company,
any Selling Stockholder or any Underwriter, and their respective heirs, executors, administrators,
successors and assigns, and no other person shall acquire or have any right under or by virtue of
this Agreement. No purchaser of any of the Shares from any Underwriter shall be deemed a successor
or assign by reason merely of such purchase.
16. Time shall be of the essence of this Agreement. As used herein, the term “business day”
shall mean any day when the Commission’s office in Washington, D.C. is open for business.
17. This Agreement shall be governed by and construed in accordance with the laws of the State
of New York.
18. In case any provision in this Agreement shall be invalid, illegal or unenforceable, the
validity and enforceability of the remaining provisions shall not in any way be affected or
impaired thereby. This Agreement constitutes the entire agreement of the parties to this Agreement
and supersedes all prior and all contemporaneous agreements (whether written or oral),
understandings and negotiations with respect to the subject matter hereof. This Agreement may only
be amended or modified in writing, signed by all of the parties hereto, and no condition herein
(express or implied) may be waived unless waived in writing by each party whom the condition is
meant to benefit.
19. This Agreement may be executed by any one or more of the parties hereto by facsimile or
..pdf signature and in any number of counterparts, each of which shall be deemed to be an original,
but all such counterparts shall together constitute one and the same instrument.
20. Each of the Company, the Selling Stockholders and the Underwriters hereby waive any right
it may have to trial by jury in respect of any claim based upon or arising out of this Agreement or
the transactions contemplated hereby.
21. Notwithstanding anything herein to the contrary, the Company and the Selling Stockholders
are authorized to disclose to any persons the U.S. federal and state income tax treatment and tax
structure of the potential transaction contemplated by this Agreement and all materials of any kind (including
tax opinions and
25
other tax analyses) provided to the Company and the Selling Stockholders relating
to that treatment and structure, without the Underwriters imposing any limitation of any kind.
However, any information relating to the tax treatment and tax structure shall remain confidential
(and the foregoing sentence shall not apply) to the extent necessary to enable any person to comply
with securities laws. For this purpose, “tax structure” is limited to any facts that may be
relevant to that treatment.
If the foregoing is in accordance with your understanding, please sign this Agreement and
return to us originally executed signature pages for the Company and each of the Selling
Stockholders plus one for each counsel and upon the acceptance hereof by you, on behalf of each of
the Underwriters, this letter and such acceptance hereof shall constitute a binding agreement among
each of the Underwriters, the Company and each of the Selling Stockholders. It is understood that
your acceptance of this letter on behalf of each of the Underwriters is pursuant to the authority
set forth in a form of Agreement among Underwriters, the form of which shall be submitted to the
Company and the Selling Stockholders for examination, upon request, but without warranty on your
part as to the authority of the signers thereof.
Any person executing and delivering this Agreement as Attorney-in-Fact for a Selling
Stockholder represents by so doing that he or she has been duly appointed as Attorney-in-Fact by
such Selling Stockholder pursuant to a validly existing and binding Power-of-Attorney which
authorizes such Attorney-in-Fact to take such action.
Very truly yours,
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SPS Commerce, Inc. | ||||||
By: | ||||||
Title: | ||||||
[Selling Stockholders] | ||||||
By powers of attorney | ||||||
By: | ||||||
Title: Power of Attorney |
(Signature Page to Underwriting Agreement)
Accepted as of the date hereof at San Francisco, California
Xxxxxx, Xxxxxxxx & Company, Incorporated | ||||||
By: | ||||||
Name: | ||||||
Title: | ||||||
On behalf of each of the Underwriters |
(Signature Page to Underwriting Agreement)