Exhibit 1.1
10,000,000 SHARES
INTEGRATED CIRCUIT SYSTEMS, INC.
COMMON STOCK, PAR VALUE $.01 PER SHARE
UNDERWRITING AGREEMENT
----------------------
May _______, 2001
▇▇▇▇▇▇ BROTHERS INC.,
Three World ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
1. Introductory. The selling shareholders of Integrated Circuit Systems,
Inc., a Pennsylvania corporation ("Company") listed in Schedule A hereto (the
"FIRM SELLING SHAREHOLDERS") propose severally to sell an aggregate of
[_________________] shares of the Company's Common Stock, par value $.01 per
share ("SECURITIES") (such [_________________] shares of Securities being
hereinafter referred to as the "FIRM SECURITIES") and the shareholders listed in
Schedule B hereto (the "OPTION SELLING SHAREHOLDERS" and together with the Firm
Selling Shareholders the "Selling Shareholders") propose severally to sell to
▇▇▇▇▇▇ Brothers Inc. (the "Underwriter"), at the option of the Underwriter, an
aggregate of not more than [_________] additional outstanding shares of the
Company's Securities, as set forth below (such [_________] additional shares
being hereinafter referred to as the "OPTIONAL SECURITIES"). The Firm Securities
and the Optional Securities are herein collectively called the "OFFERED
SECURITIES". The Company and the Selling Shareholders hereby agree with the
Underwriter as follows:
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2. Representations and Warranties of the Company and the Selling
Shareholders.
(a) The Company represents and warrants to, and agrees with, the
Underwriter that:
(i) A registration statement (No. 333-_________) on Form S-3
relating to the Offered Securities, including a form of prospectus, has
been filed with the Securities and Exchange Commission ("COMMISSION")
and either (A) has been declared effective under the Securities Act of
1933, as amended ("ACT") and is not proposed to be amended or (B) is
proposed to be amended by amendment or post-effective amendment. The
Company and the transaction contemplated by this Agreement meet the
requirements for use of Form S-3 under the Act. If such registration
statement (the "INITIAL REGISTRATION STATEMENT") has been declared
effective, either (A) an additional registration statement (the
"ADDITIONAL REGISTRATION STATEMENT") relating to the Offered Securities
may have been filed with the Commission pursuant to Rule 462(b) ("RULE
462(b)") under the Act and, if so filed, has become effective upon
filing pursuant to such Rule and the Offered Securities all have been
duly registered under the Act pursuant to the initial registration
statement and, if applicable, the additional registration statement or
(B) such an additional registration statement is proposed to be filed
with the Commission pursuant to Rule 462(b) and will become effective
upon filing pursuant to such Rule and upon such filing the Offered
Securities will all have been duly registered under the Act pursuant to
the initial registration statement and such additional registration
statement. If the Company does not propose to amend the initial
registration statement or if an additional registration statement has
been filed and the Company does not propose to amend it, and if any
post-effective amendment to either such registration statement has been
filed with the Commission prior to the execution and delivery of this
Agreement, the most recent amendment (if any) to each such registration
statement has been declared effective by the Commission or has become
effective upon filing pursuant to Rule 462(c) ("RULE 462(c)") under the
Act or, in the case of the additional registration statement, Rule
462(b). For purposes of this Agreement, "EFFECTIVE TIME" with respect
to the initial registration statement or, if filed prior to the
execution and delivery of this Agreement, the additional registration
statement, means (A) if the Company has advised the Representatives
that it does not propose to amend such registration statement, the date
and time as of which such registration statement, or the most recent
post-effective amendment thereto (if any) filed prior to the execution
and delivery of this Agreement, was declared effective by the
Commission or has become effective upon filing pursuant to Rule 462(c),
or (B) if the Company has advised the Underwriter that it proposes to
file an amendment or post-effective amendment to such registration
statement, the date and time as of which such registration statement,
as amended by such amendment or
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post-effective amendment, as the case may be, is declared effective by
the Commission. If an additional registration statement has not been
filed prior to the execution and delivery of this Agreement but the
Company has advised the Underwriter that it proposes to file one,
"EFFECTIVE TIME" with respect to such additional registration statement
means the date and time as of which such registration statement is
filed and becomes effective pursuant to Rule 462(b). "EFFECTIVE DATE"
with respect to the initial registration statement or the additional
registration statement (if any) means the date of the Effective Time
thereof. The initial registration statement, as amended at its
Effective Time, including all material incorporated by reference
therein and all information contained in the additional registration
statement (if any) and deemed to be a part of the initial registration
statement as of the Effective Time of the additional registration
statement pursuant to the General Instructions of the Form on which it
is filed and including all information (if any) deemed to be a part of
the initial registration statement as of its Effective Time pursuant to
Rule 430A(b) ("RULE 430A(b)") under the Act, is hereinafter referred to
as the "INITIAL REGISTRATION STATEMENT". The additional registration
statement, as amended at its Effective Time, including the contents of
the initial registration statement incorporated by reference therein
and including all information (if any) deemed to be a part of the
additional registration statement as of its Effective Time pursuant to
Rule 430A(b), is hereinafter referred to as the "ADDITIONAL
REGISTRATION STATEMENT". The Initial Registration Statement and the
Additional Registration Statement are hereinafter referred to
collectively as the "REGISTRATION STATEMENTS" and individually as a
"REGISTRATION STATEMENT". The form of prospectus relating to the
Offered Securities, as first filed with the Commission pursuant to and
in accordance with Rule 424(b) ("RULE 424(b)") under the Act or (if no
such filing is required) as included in a Registration Statement,
including all material incorporated by reference in such prospectus is
hereinafter referred to as the "PROSPECTUS". No document has been or
will be prepared or distributed in reliance on Rule 434 under the Act.
(ii) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement: (A)
on the Effective Date of the Initial Registration Statement, the
Initial Registration Statement conformed in all respects to the
requirements of the Act and the rules and regulations of the Commission
("RULES AND REGULATIONS") and did not include 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, (B)
on the Effective Date of the Additional Registration Statement (if
any), each Registration Statement conformed or will conform, in all
respects to the requirements of the Act and the Rules and Regulations
and did not include, or
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will not include, any untrue statement of a material fact and did not
omit, or will not omit, to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading, and (C) on the date of this Agreement, the Initial
Registration Statement and, if the Effective Time of the Additional
Registration Statement is prior to the execution and delivery of this
Agreement, the Additional Registration Statement each conforms, and at
the time of filing of the Prospectus pursuant to Rule 424(b) or (if no
such filing is required) at the Effective Date of the Additional
Registration Statement in which the Prospectus is included, each
Registration Statement and the Prospectus will conform, in all respects
to the requirements of the Act and the Rules and Regulations, and
neither of such documents includes, or will include, any untrue
statement of a material fact or omits, or will omit, to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading. If the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of
this Agreement: on the Effective Date of the Initial Registration
Statement, the Initial Registration Statement and the Prospectus will
conform in all respects to the requirements of the Act and the Rules
and Regulations, neither of such documents will include any untrue
statement of a material fact or will omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading, and no Additional Registration Statement has
been or will be filed. The two preceding sentences do not apply to
statements in or omissions from a Registration Statement or the
Prospectus based upon written information furnished to the Company by
the Underwriter, it being understood and agreed that the only such
information is that described as such in Section 7(c) hereof.
(iii) The Company has been duly incorporated and is an
existing corporation in good standing under the laws of the
Commonwealth of Pennsylvania, with power and authority (corporate and
other) to own its properties and conduct its business as described in
the Prospectus; and the Company is duly qualified to do business as a
foreign corporation in good standing in all other jurisdictions in
which its ownership or lease of property or the conduct of its business
requires such qualification, except where the failure to be so
qualified and in good standing would not reasonably be expected to
individually or in the aggregate (x) result in a material adverse
effect on the properties, business, result of operations, condition
(financial or other), affairs or prospects of the Company and its
subsidiaries taken as a whole, (y) interfere with or adversely affect
the issuance or marketability of the Offered Securities or (z) in any
manner draw into question the validity of this Agreement (any of the
events set forth in clauses (x), (y) or (z), a "MATERIAL ADVERSE
EFFECT").
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(iv) Each subsidiary of the Company that (A) generates 5% or
more of the revenues, (B) generates 5% or more of the operating income,
or (C) holds 5% or more of the assets, in each case, of the Company and
its subsidiaries on a consolidated basis as reflected in the financial
statements included in the Prospectus under the heading "Unaudited Pro
Forma Consolidated Financial Data" (each, a "SIGNIFICANT SUBSIDIARY")
of the Company has been duly incorporated and is an existing
corporation in good standing under the laws of the jurisdiction of its
incorporation, with power and authority (corporate and other) to own
its properties and conduct its business as described in the Prospectus;
and each Significant Subsidiary of the Company is duly qualified to do
business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification, except where the
failure to be so qualified and in good standing could not reasonably be
expected, individually or in the aggregate, to have a Material Adverse
Effect; all of the issued and outstanding capital stock of the Company
and of each Significant Subsidiary has been duly authorized and validly
issued and is fully paid and nonassessable; and the capital stock of
each Significant Subsidiary owned by the Company, directly or through
subsidiaries, is owned free from liens, encumbrances and defects.
(v) As of December 30, 2000, the Company had an authorized
capitalization as set forth in the Prospectus under the heading
"Capitalization" and all of the Offered Securities and all other
outstanding shares of capital stock of the Company have been duly
authorized by all necessary corporate action and validly issued, fully
paid and nonassessable and conform to the description thereof contained
in the Prospectus; and the shareholders of the Company have no
preemptive rights with respect to the Securities.
(vi) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or any
Underwriter for a brokerage commission, finder's fee or other like
payment in connection with this offering.
(vii) Except as disclosed in the 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 owned or to be owned by such person or to require the
Company to include such securities in the securities registered
pursuant to a Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Act, and to the extent any such rights are applicable
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in respect of a Registration Statement, such rights have been fully
satisfied or waived in accordance with their terms.
(viii) The Securities are traded on The Nasdaq Stock Market's
National Market (the "NASDAQ NATIONAL MARKET").
(ix) No consent, approval, authorization, or order of, or
filing with, any governmental agency or body or any court or other
person is required to be obtained or made by the Company for the
execution and delivery of this Agreement and consummation of the
transactions contemplated by this Agreement in connection with the sale
of the Offered Securities except such as have been obtained and made
under the Act and such as may be required under state securities or
"Blue Sky" laws.
(x) The execution, delivery and performance of this Agreement,
and the consummation of the transactions herein contemplated will not
result in a breach or violation of any of the terms and provisions of,
or constitute a default under, (A) any statute, any rule, regulation or
order of any governmental agency or body or any court, domestic or
foreign, having jurisdiction over the Company or any subsidiary of the
Company or any of their properties, (B) any agreement or instrument to
which the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries is bound or to which any of the
properties of the Company or any of its subsidiaries is subject, or (C)
or the charter or by-laws of the Company or any of its subsidiaries,
except (1) in each case, that any rights to indemnity and contribution
may be limited by federal and state securities laws and public policy
considerations and (2) in the case of clauses (A) and (B) for such
breaches, violations or defaults as would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Effect;
and the Company has full corporate power and authority to authorize,
issue and sell the Offered Securities as contemplated by this
Agreement, and the Company has full corporate power and authority to
execute, deliver and perform this Agreement.
(xi) This Agreement has been duly authorized, executed and
delivered by the Company.
(xii) Except as disclosed in the Prospectus, the Company and
its subsidiaries have good and marketable title to all real properties
and all other properties and assets owned by them that are material to
the Company and its subsidiaries taken as a whole, in each case free
from liens, encumbrances and defects that would materially affect the
value thereof or materially interfere with the use made or proposed to
be made thereof by them; and except as disclosed
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in the Prospectus, the Company and its subsidiaries hold any leased
real or personal property that is material to the Company and its
subsidiaries taken as a whole under valid and enforceable leases with
no exceptions that would materially interfere with the use made or
proposed to be made thereof by them.
(xiii) The Company and its subsidiaries possess all
certificates, authorities or permits issued by appropriate governmental
agencies or bodies necessary to conduct the business now operated by
them and have not received any notice of proceedings relating to the
revocation or modification of any such certificate, authority or permit
that, if determined adversely to the Company or any of its
subsidiaries, would reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect.
(xiv) No labor strike, slowdown, stoppage or dispute with the
employees of the Company or any of its subsidiaries exists or, to the
knowledge of the Company, is imminent that would reasonably be
expected, individually or in the aggregate, to have a Material Adverse
Effect. None of the Company or any of its subsidiaries has violated (A)
any federal, state or local law or foreign law relating to
discrimination in hiring, promotion or pay of employees, (B) any
applicable wage or hour laws, or (C) any provision of the Employee
Retirement Income Security Act of 1974, as amended, or the rules and
regulations thereunder, except those violations that could not
reasonably be expected, individually or in the aggregate, to have a
Material Adverse Effect.
(xv) The Company and its subsidiaries own, possess, have the
right to use or can acquire on reasonable terms, adequate trademarks,
trade names and other rights to inventions, know-how, patents,
copyrights, confidential information and other intellectual property
(collectively, "INTELLECTUAL PROPERTY RIGHTS") used in the conduct the
business now operated by them, or presently employed by them, and have
not received any notice of infringement of or conflict with asserted
rights of others with respect to any intellectual property rights that,
if determined adversely to the Company or any of its subsidiaries,
would reasonably be expected, individually or in the aggregate, to have
a Material Adverse Effect. To the knowledge of the Company after due
inquiry, the use of the intellectual property rights in connection with
the business and operations of the Company or any of its subsidiaries
does not infringe on the rights of any person, except such
infringements as would not reasonably be expected, individually or in
the aggregate, to have a Material Adverse Effect.
(xvi) Neither the Company nor any of its subsidiaries (A) is
in violation of any statute, any rule, regulation, decision or order of
any governmental
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agency or body or any court, domestic or foreign, relating to the use,
disposal or release of hazardous or toxic substances or relating to the
protection or restoration of the environment or human exposure to
hazardous or toxic substances (collectively, "ENVIRONMENTAL LAWS"), (B)
owns or operates any real property contaminated with any substance that
is subject to any environmental laws, (C) is liable for any off-site
disposal or contamination pursuant to any environmental laws, or (D) is
subject to any claim relating to any environmental laws, in each case,
which violation, contamination, liability or claim would reasonably be
expected, individually or in the aggregate, to have a Material Adverse
Effect; and the Company is not aware of any pending investigation which
might lead to such a claim.
(xvii) Except as disclosed in the Prospectus, there are no
pending actions, suits or proceedings against or affecting the Company,
any of its subsidiaries or any of their respective properties that, if
determined adversely to the Company or any of its subsidiaries, would
reasonably be expected, individually or in the aggregate, to have 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
Offered Securities; and no such actions, suits or proceedings are, to
the Company's knowledge, threatened or contemplated.
(xviii) The financial statements included in each Registration
Statement and the Prospectus present fairly the financial position of
the Company and its consolidated subsidiaries as of the dates shown
(subject in the case of interim financial statements to the normal
year-end adjustments) and their results of operations and cash flows
for the periods shown, and such financial statements have been prepared
in conformity with the generally accepted accounting principles in the
United States applied on a consistent basis and the schedules included
in each Registration Statement present fairly the information required
to be stated therein.
(xix) Except as disclosed in the Prospectus, since the date of
the latest audited financial statements included in the Prospectus
there has been (A) no material adverse change, nor any development or
event involving a prospective material adverse change, in the condition
(financial or other), business, properties or results of operations of
the Company and its
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subsidiaries taken as a whole, (B) except as disclosed in or
contemplated by the Prospectus, there has been no dividend or
distribution of any kind declared, paid or made by the Company on any
class of its capital stock, (C) none of the Company or any of its
subsidiaries has incurred any liabilities or obligations, direct or
contingent, which are material, individually or in the aggregate, to
the Company and its subsidiaries, taken as a whole, nor entered into
any transaction not in the ordinary course of business, and (D) none of
the Company or any of its subsidiaries has incurred any liabilities or
obligations, direct or contingent, that are material, individually or
in the aggregate, to the Company and its subsidiaries, taken as a
whole, and that are required to be disclosed on a balance sheet or
notes thereto in accordance with generally accepted accounting
principles and are not disclosed on the latest balance sheet or notes
thereto included in the Prospectus.
(xx) The Company is not an open-end investment company, unit
investment trust or face-amount certificate company that is or is
required to be registered under Section 8 of the United States
Investment Company Act of 1940 (the "INVESTMENT COMPANY ACT"); and the
Company is not and, after giving effect to the offering and sale of the
Offered Securities and the application of the proceeds thereof as
described in the Prospectus, will not be an "investment company" as
defined in the Investment Company Act.
(xxi) Each of the Company and its subsidiaries maintains a
system of internal accounting controls sufficient to provide reasonable
assurance that: (A) transactions are executed in accordance with
management's general or specific authorizations; (B) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain accountability for assets; (C) access to assets is permitted
only in accordance with management's general or specific authorization;
and (D) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken
with respect thereto.
(xxii) Each of the Company and its subsidiaries maintains
insurance covering its properties, operations, personnel and
businesses, insuring against such losses and risks as are consistent
with industry practice to protect the Company and its subsidiaries and
their respective businesses. None of the Company or any of its
subsidiaries has received notice from any insurer or agent of such
insurer that substantial capital improvements or other expenditures
will have to be made in order to continue such insurance.
(xxiii) The statistical and market-related data included in
the Prospectus are based on or derived from sources that the Company
believes to be accurate and reliable in all material respects.
(xxiv) The Company has not, directly or indirectly, (A) taken
any action designed to cause or to result in, or that has constituted
or which might
9
reasonably be expected to constitute, the stabilization or manipulation
of the price of any security of the Company to facilitate the sale or
resale of the Securities or (B) since the filing of the Registration
Statement (1) sold, bid for, purchased, or paid anyone any compensation
for soliciting purchases of, the Securities or (2) paid or agreed to
pay to any person any compensation for soliciting another to purchase
any other securities of the Company (except for the sale of Securities
by the Selling Shareholders under this Agreement).
(xxv) Each certificate signed by any officer of the Company or
any of its subsidiaries and delivered to the Underwriters or counsel
for the Underwriters shall be deemed to be a representation and
warranty by the Company or such subsidiary to the Underwriters as to
the matters covered thereby.
(b) Each Selling Shareholder severally represents and warrants to, and
agrees with, the several Underwriters that:
(i) Such Selling Shareholder has and on each Closing Date
hereinafter mentioned will have valid and unencumbered title to the
Offered Securities to be delivered by such Selling Shareholder on such
Closing Date, free and clear of any pledge, lien, security interest,
charge, claim, equity or encumbrance of any kind; such Selling
Shareholder has full right, power and authority to enter into this
Agreement, the Custody Agreement (the "CUSTODY AGREEMENT") and the
Irrevocable Power of Attorney (the "POWER OF ATTORNEY") entered into by
such Selling Shareholder in connection with the transactions
contemplated hereby and to sell, assign, transfer and deliver the
Offered Securities to be delivered by such Selling Shareholder on such
Closing Date hereunder; and upon the delivery of and payment for the
Offered Securities on each Closing Date hereunder such Selling
Shareholder will pass valid and unencumbered title to the Offered
Securities to be delivered by such Selling Shareholder to the several
Underwriters on such Closing Date.
(ii) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement: (A)
on the Effective Date of the Initial Registration Statement, the
Initial Registration Statement did not include any untrue statement of
a material fact or omit to state any material fact required to b e
stated therein or necessary to make the statements therein not
misleading, (B) on the Effective Date of the Additional Registration
Statement (if any), each Registration Statement did not include, or
will not include, any untrue statement of a material fact and did not
omit, or will not omit, to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading, and (C) on the date of this Agreement, the Initial
Registration
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Statement and, if the Effective Time of the Additional Registration
Statement is prior to the execution and delivery of this Agreement, the
Additional Registration Statement, and at the time of filing of the
Prospectus pursuant to Rule 424(b) or (if no such filing is required)
at the Effective Date of the Additional Registration Statement in which
the Prospectus is included, and on each Closing Date neither each
Registration Statement nor the Prospectus includes, or will include,
any untrue statement of a material fact or omits, or will omit to state
any material fact required to be stated therein or necessary to make
the statements therein not misleading. If the Effective Time of the
Initial Registration Statement is subsequent to the execution and
delivery of this Agreement: on the Effective Date of the Initial
Registration Statement and on each Closing Date, neither the Initial
Registration Statement nor the Prospectus will include any untrue
statement of a material fact or will omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading. The two preceding sentences apply only to the
extent that any statements in or omissions from a Registration
Statement or the Prospectus are based on written information furnished
to the Company by such Selling Shareholder specifically for use
therein.
(iii) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between such Selling
Shareholder and any third party that would give rise to a valid claim
against the Company or any Underwriter for a brokerage commission,
finder's fee or other like payment in connection with the transactions
contemplated by this Agreement, the Custody Agreement and the Power of
Attorney.
(iv) This Agreement, the Custody Agreement and the Power of
Attorney have each been duly authorized, executed and delivered by or
on behalf of such Selling Shareholder and this Agreement, the Custody
Agreement and the Power of Attorney each constitute the legal, valid
and binding obligations of such Selling Shareholder enforceable against
such Selling Shareholder in accordance with their respective terms
(except as rights to indemnification and contribution may be limited by
applicable federal or state law).
(v) No consent, approval, authorization, order, registration
or qualification of, or filing with, any third party (whether acting in
an individual, fiduciary or other capacity) or any governmental or
regulatory agency or body or court is required to be obtained or made
by such Selling Shareholder for the consummation of the transactions
contemplated by this Agreement, the Custody Agreement and the Power of
Attorney in connection with the sale of the Offered Securities, except
such as have been obtained and made under the Act and such as may be
required under state securities laws.
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(vi) The execution, delivery and performance of this
Agreement, the Custody Agreement and the Power of Attorney by such
Selling Shareholder and the consummation of the transactions herein and
therein contemplated will not conflict with or result in a breach or
violation of any of the terms and provisions of, or constitute a
default under (A) any statute, any rule, regulation or order of any
governmental agency or body or any court, domestic or foreign, having
jurisdiction over such Selling Shareholder or any of its properties or
operations, or any agreement or instrument to which such Selling
Shareholder is a party or by which such Selling Shareholder is bound or
to which any of the properties or operations of such Selling
Shareholder is subject, or (B) if applicable, the charter, by- laws or
other organizational documents of such Selling Shareholder, except, in
the case of clause (A), for such conflicts, breaches, violations or
defaults which could not reasonably be expected to, individually or in
the aggregate, have a material adverse effect on the consummation of
the transactions contemplated by this Agreement, the Custody Agreement
or the Power of Attorney.
(vii) Such Selling Shareholder has not taken and will not
take, directly or indirectly, any action designed to or that could
reasonably be expected to cause or result in stabilization or
manipulation of the price of the Offered Securities to facilitate the
sale or resale of the Offered Securities, and such Selling Shareholder
has not distributed and will not distribute any offering material in
connection with the offering and sale of the Offered Securities other
than any preliminary prospectus filed with the Commission or the
Prospectus or other materials, if any, permitted by the Act or the
Rules and Regulations.
3. Purchase, Sale and Delivery of Offered Securities. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, (i) each Firm Selling Shareholder agrees,
severally and not jointly, to sell the number of Firm Securities set forth
opposite such Firm Selling Shareholder's name in Schedule A hereto, and (ii)
the Underwriter agrees, severally and not jointly, to purchase from each such
Firm Selling Shareholder, at a purchase price of $[_________________] per share,
that number of Firm Securities (rounded up or down, as determined by the
Underwriter in its discretion, in order to avoid fractions) obtained by
multiplying the number of Firm Securities set forth opposite the name of such
Firm Selling Shareholder in Schedule A hereto by a fraction the numerator of
which is the number of Firm Securities set forth opposite the name of such
Underwriter in Schedule C hereto and the denominator of which is the total
number of Firm Securities.
Certificates in negotiable form for the Offered Securities to be sold by
the Selling Shareholders have been placed in custody, for delivery under this
Agreement, under Custody Agreements made with [________________________________]
(the "CUSTODIAN"). Each Selling Shareholder agrees that the shares represented
by the certificates held in custody for such Selling Shareholders under such
Custody Agreements are subject to the interests of the Underwriter
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hereunder, that the arrangements made by the Selling Shareholders for such
custody are to that extent irrevocable, and that the obligations of such Selling
Shareholders hereunder shall not be terminated by operation of law, whether by
the death of any individual Selling Shareholder or the occurrence of any other
event, or in the case of a trust, by the death of any trustee or trustees or the
termination of such trust. If any individual Selling Shareholder or any such
trustee or trustees should die, or if any other such event should occur, or if
any of such trusts should terminate, before the delivery of the Offered
Securities hereunder, certificates for such Offered Securities shall be
delivered by the Custodian in accordance with the terms and conditions of this
Agreement as if such death or other event or termination had not occurred,
regardless of whether or not the Custodian shall have received notice of such
death or other event or termination.
The Custodian will deliver the Firm Securities to the Representatives for
the accounts of the Underwriters, against payment of the purchase price in
Federal (same day) funds by official bank check or checks or wire transfer to an
account at a bank acceptable to the Underwriter drawn to the order of the
Custodian at the office of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP ("▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇") located at
▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, at 9:00 A.M., Eastern
Standard Time, on [____________], 2001, or at such other time not later than
seven full business days thereafter as the Underwriter and the Custodian may
determine, such time being herein referred to as the "FIRST CLOSING DATE". The
certificates for the Firm Securities so to be delivered will be in definitive
form, in such denominations and registered in such names as the Underwriter
requests and will be made available for checking and packaging at the office of
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ at least 24 hours prior to the First Closing Date.
In addition, upon written notice from the Underwriter given to the Company
and the attorney-in-fact for the Selling Shareholders from time to time not more
than 30 days subsequent to the date of the Prospectus, the Underwriter may
purchase all or less than all of the Optional Securities at the purchase price
per Security to be paid for the Firm Securities. If the number of Optional
Securities in the Underwriter's notice ("Requested Amount") is equal to the
total number of Optional Securities, (i) each Option Selling Shareholder agrees,
severally and not jointly, to sell to the Underwriter the number of Optional
Securities set forth opposite such Option Selling Shareholder's name in Schedule
B hereto and (ii) the Underwriter agrees, severally and not jointly, to purchase
from each Option Selling Shareholder that number of Optional Securities (rounded
up or down, as determined by the Underwriter in its discretion, in order to
avoid fractions) obtained by multiplying the number of Optional Securities set
forth opposite the name of such Option Selling Shareholder in Schedule B hereto
by a fraction, the numerator of which is the number of Firm Securities set forth
opposite the name of such Option Selling Shareholder in Schedule B hereto.
If the Requested Amount is less than the total number of Optional
Securities, the Option Selling Shareholders shall sell, and the Underwriter
shall purchase, such Optional Securities as follows: (i) first, the Underwriter
shall purchase the Optional Securities from the holders of the Priority
Securities (as hereinafter defined) on a pro rata basis; and (ii) second, to the
extent the Requested Amount exceeds the amount of Priority Securities, such
excess shall be
13
purchased from the holders of the Non-Priority Securities (as hereinafter
defined) on a pro rata basis.
No Optional Securities shall be sold or delivered unless the Firm
Securities previously have been, or simultaneously are, sold and delivered. The
right to purchase the Optional Securities or any portion thereof may be
exercised from time to time pursuant to the prior two paragraphs to the extent
not previously exercised and may be surrendered and terminated at any time upon
notice by the Underwriter to the Company and the Option Selling Shareholders.
"PRIORITY SECURITIES" shall mean the Optional Securities designated as priority
securities in Schedule B hereto. "NON-PRIORITY SECURITIES" shall mean the
Optional Securities designated as non-priority securities in Schedule B hereto.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "Optional Closing Date", which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "CLOSING DATE"), shall be determined by the
Underwriter but shall be not later than five full business days after written
notice of election to purchase Optional Securities is given. The Custodian will
deliver the Optional Securities being purchased on each Optional Closing Date to
the Underwriter, against payment of the purchase price therefor in Federal (same
day) funds by official bank check or checks or wire transfer to an account or
accounts at a bank(s) acceptable to the Underwriter drawn to the order of the
Custodian in amounts relating to the number of Optional Securities being sold by
each such Option Selling Shareholder as determined pursuant to the three
preceding paragraphs, at the above office of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇. The certificates
for the Optional Securities being purchased on each Optional Closing Date will
be in definitive form, in such denominations and registered in such names as the
Underwriter requests upon reasonable notice prior to such Optional Closing Date
and will be made available for checking and packaging at the office of ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ at a reasonable time in advance of such Optional Closing Date.
4. Offering by Underwriter. It is understood that the Underwriter proposes
to offer the Offered Securities for sale to the public as set forth in the
Prospectus.
5. Certain Agreements of the Company and the Selling Shareholders. The
Company and the Selling Shareholders, to the extent such covenants relate to
their performance, agree with the several Underwriter that:
(a) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement, the Company will
file the Prospectus with the Commission pursuant to and in accordance with
subparagraph (1) (or, if applicable and if consented to by the Underwriter,
subparagraph (4)) of Rule 424(b) not later than the earlier of (A) the
second business day following the execution and delivery of this Agreement
or (B) the fifteenth business day after the Effective Date of the Initial
Registration Statement. The Company will advise the Underwriter promptly of
any such filing pursuant to Rule 424(b). If the Effective Time of the
Initial Registration Statement is
14
prior to the execution and delivery of this Agreement and an additional
registration statement is necessary to register a portion of the Offered
Securities under the Act but the Effective Time thereof has not occurred as
of such execution and delivery, the Company will file the additional
registration statement or, if filed, will file a post-effective amendment
thereto with the Commission pursuant to and in accordance with Rule 462(b)
on or prior to 10:00 A.M., New York time, on the business day following the
date of this Agreement or, if earlier, on or prior to the time the
Prospectus is printed and distributed to any Underwriter, or will make such
filing at such later date as shall have been consented to by the
Underwriter.
(b) The Company will advise the Underwriter promptly of any proposal
to amend or supplement the initial or any additional registration statement
as filed or the related prospectus or the Initial Registration Statement,
the Additional Registration Statement (if any) or the Prospectus and will
not effect such amendment or supplementation without the Underwriter's
consent; and the Company will also advise the Underwriter promptly of the
effectiveness of each Registration Statement (if its Effective Time is
subsequent to the execution and delivery of this Agreement) and of any
amendment or supplementation of a Registration Statement or the Prospectus
and of the institution by the Commission of any stop order proceedings in
respect of a Registration Statement and will use its best efforts to
prevent the issuance of any such stop order and to obtain as soon as
possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with
sales by the Underwriter or dealer, any event occurs 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
to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary at any time to
amend the Prospectus to comply with the Act, the Company will promptly
notify the Underwriter of such event and will promptly prepare and file
with the Commission, at its own expense, an amendment or supplement which
will correct such statement or omission or an amendment which will effect
such compliance. Neither the Underwriter's consent to, nor the
Underwriter's delivery of, any such amendment or supplement shall
constitute a waiver of any of the conditions set forth in Section 6.
(d) As soon as practicable, but not later than the Availability Date
(as defined below), the Company will make generally available to its
securityholders an earnings statement covering a period of at least 12
months beginning after the Effective Date of the Initial Registration
Statement (or, if later, the Effective Date of the Additional Registration
Statement) which will satisfy the provisions of Section 11(a) of the Act.
For the purpose of the preceding sentence, "AVAILABILITY DATE" means the
45th day after the end of the fourth fiscal quarter following the fiscal
quarter that includes such Effective Date, except that, if such fourth
fiscal quarter is the last quarter of the
15
Company's fiscal year, "AVAILABILITY DATE" means the 90th day after the end
of such fourth fiscal quarter.
(e) The Company will furnish to the Representatives copies of each
Registration Statement (five of which will be signed and will include all
exhibits), each related preliminary prospectus, and, so long as a
prospectus relating to the Offered Securities is required to be delivered
under the Act in connection with sales by any Underwriter or dealer, the
Prospectus and all amendments and supplements to such documents, in each
case in such quantities as the Underwriter requests. The Prospectus shall
be so furnished on or prior to 3:00 P.M., Eastern Standard Time, on the
business day following the later of the execution and delivery of this
Agreement or the Effective Time of the Initial Registration Statement. All
other such documents shall be so furnished as soon as available. The
Company will pay the expenses of printing and distributing to the
Underwriter all such documents.
(f) The Company will cooperate with the Underwriter and its counsel in
connection with the registration and qualification of the Offered
Securities for sale and the determination of their eligibility for
investment under the laws of such jurisdictions as the Underwriter
designates and do all things necessary to continue such qualifications in
effect so long as required for the resale of the Offered Securities by the
Underwriter, provided that the Company will not be required to qualify as a
foreign corporation or to file a general consent to service of process in
any such jurisdiction.
(g) During the period of five years hereafter, the Company will
furnish to the Underwriter as soon as practicable after the end of each
fiscal year, a copy of its annual report to shareholders for such year; and
the Company will furnish to the Underwriter (i) as soon as available, a
copy of each report and any definitive proxy statement of the Company filed
with the Commission under the Securities Exchange Act of 1934, as amended
(the "EXCHANGE ACT") or mailed to shareholders, and (ii) from time to time,
such other information concerning the Company as the Underwriter may
reasonably request.
(h) For a period of 90 days after the date of the public offering of
the Offered Securities, the Company will not offer, sell, contract to sell,
pledge or otherwise dispose of, directly or indirectly, or file with the
Commission a registration statement under the Act relating to, any
additional shares of its Securities or securities convertible into or
exchangeable or exercisable for any shares of its Securities, or publicly
disclose the intention to make any such offer, sale, pledge, disposition or
filing, without the prior written consent of the Underwriter, except grants
of employee stock options pursuant to the terms of a plan in effect on the
date hereof, issuances of Securities pursuant to the exercise of such
options or the exercise of any other employee stock options outstanding on
the date hereof.
16
(i) The Company and each Selling Shareholder agree with the
Underwriter that the Company will pay all expenses incident to the
performance of the obligations of the Company and such Selling Shareholder,
as the case may be, under this Agreement, for any filing fees and other
expenses (including fees and disbursements of counsel) in connection with
qualification of the Offered Securities for sale under the laws of such
jurisdictions as the Underwriter designates and the printing of memoranda
relating thereto, for the filing fee incident to, and the reasonable fees
and disbursements of counsel to the Underwriters in connection with, the
review by the National Association of Securities Dealers, Inc.("NASD") of
the Offered Securities, for any travel expenses of the Company's officers
and employees and any other expenses of the Company in connection with
attending or hosting meetings with prospective purchasers of the Offered
Securities, for any transfer taxes on the sale by the Selling Shareholders
of the Offered Securities to the Underwriter and for expenses incurred in
distributing preliminary prospectuses and the Prospectus (including any
amendments and supplements thereto) to the Underwriter.
(j) Each Selling Shareholder agrees to deliver to the Underwriter,
attention: [_____________________________________], on or prior to the
first Closing Date 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).
(k) Each Selling Shareholder agrees, for a period of 90 days after the
date of the public offering of the Offered Securities, not to offer, sell,
contract to sell, pledge or otherwise dispose of, directly or indirectly,
any additional shares of the Securities of the Company or securities
convertible into or exchangeable or exercisable for any shares of
Securities, enter into a transaction which would have the same effect, or
enter into any swap, hedge or other arrangement that transfers, in whole or
in part, any of the economic consequences of ownership of the Securities,
whether any such aforementioned transaction is to be settled by delivery of
the Securities or such other securities, in cash or otherwise, or publicly
disclose the intention to make any such offer, sale, pledge or disposition,
or enter into any such transaction, swap, hedge or other arrangement,
without, in each case, the prior written consent of ▇▇▇▇▇▇.
6. Conditions of the Obligations of the Underwriter. The obligations of the
Underwriter to purchase and pay for the Firm Securities on the First Closing
Date and the Optional Securities to be purchased on each Optional Closing Date
will be subject to the accuracy of the representations and warranties on the
part of the Company and the Selling Shareholders herein, to the accuracy of the
statements of Company officers made pursuant to the provisions hereof, to the
performance by the Company and the Selling Shareholders of their obligations
hereunder and to the following additional conditions precedent:
(a) The Representatives shall have received a letter, dated the date
of this Agreement, of PricewaterhouseCoopers LLP in agreed form confirming
that they are
17
independent public accountants within the meaning of the Act and the
published Rules and Regulations and stating to the effect that:
(i) in their opinion the financial statements and schedules, for
all periods after July 3, 1999, examined by them and included in the
Registration Statements comply as to form in all material respects
with the applicable accounting requirements of the Act and the related
published Rules and Regulations;
(ii) they have performed the procedures specified by the American
Institute of Certified Public Accountants for a review of interim
financial information as described in Statement of Auditing Standards
No. 71, Interim Financial Information, on the unaudited financial
statements, for all periods after July 3, 1999, and certain specified
financial information included in the Registration Statements;
(iii) on the basis of the review referred to in clause (ii)
above, a reading of the latest available interim financial statements
of the Company and of all subsidiaries of the Company for which such
interim financial statements are provided, inquiries of officials of
the Company and of such subsidiaries who have responsibility for
financial and accounting matters and other specified procedures,
nothing came to their attention that caused them to believe that:
(A) with respect to the unaudited financial statements, for all
periods after July 3, 1999, included in the Registration
Statements, that any material modifications should be made
to such unaudited financial statements for them to be in
conformity with generally accepted accounting principles;
(B) at the date of the latest available balance sheet read by
such accountants, or at a subsequent date not more than
three business days prior to the date of this Agreement,
there was any change in the capital stock or any increase in
short-term indebtedness or long-term debt of the Company and
its consolidated subsidiaries or, any decrease in
consolidated net current assets or net assets, as compared
with amounts shown on the latest balance sheet included in
the Prospectus; or
(C) for the period from the closing date of the latest income
statement included in the Prospectus to the closing date of
the latest available income statement read by such
accountants there were any decreases, as compared with the
corresponding period of the previous year and with the
period of corresponding length ended
18
the date of the latest income statement included in the
Prospectus, in consolidated net sales or net operating
income or net income;
except in all cases set forth in clause (A) above for changes,
increases or decreases which the Prospectus discloses have occurred or
may occur or which are described in such letter; and
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other financial
information contained in the Registration Statements (in each
case to the extent that such dollar amounts, percentages and
other financial information are derived from the general
accounting records of the Company and its subsidiaries subject to
the internal controls of the Company's accounting system or are
derived directly from such records by analysis or computation)
with the results obtained from inquiries, a reading of such
general accounting records and other procedures specified in such
letter and have found such dollar amounts, percentages and other
financial information to be in agreement with such results,
except as otherwise specified in such letter.
For purposes of this subsection (a) and subsection (b) below, (i) if
the Effective Time of the Initial Registration Statements is
subsequent to the execution and delivery of this Agreement,
"REGISTRATION STATEMENTS" shall mean the initial registration
statement as proposed to be amended by the amendment or post-effective
amendment to be filed shortly prior to its Effective Time, (ii) if the
Effective Time of the Initial Registration Statements is prior to the
execution and delivery of this Agreement but the Effective Time of the
Additional Registration Statement is subsequent to such execution and
delivery, "REGISTRATION STATEMENTS" shall mean the Initial
Registration Statement and the additional registration statement as
proposed to be filed or as proposed to be amended by the
post-effective amendment to be filed shortly prior to its Effective
Time, and (iii) "PROSPECTUS" shall mean the prospectus included in the
Registration Statements. -- All financial statements and schedules
included in material incorporated by reference into the Prospectus
shall be deemed included in the Registration Statements for purposes
of this subsection (a) and subsection (b) below.
(b) The Representatives shall have received a letter, dated the
date of this Agreement, of KPMG LLP in agreed form confirming that
they are independent public accountants within the meaning of the
Securities Act and the Rules and Regulations and to the effect that:
(i) in their opinion the financial statements and schedules,
for all periods prior to and including July 3, 1999, examined by
them and included in
19
the Registration Statements for comply as to form in all material
respects with the applicable accounting requirements of the Act
and the related published Rules and Regulations;
(ii) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a review
of interim financial information as described in Statement of
Auditing Standards No. 71, Interim Financial Information, on the
unaudited financial statements, for all periods prior to and
including July 3, 1999, and certain specified financial
information included in the Registration Statements;
(iii) on the basis of the review referred to in clause (ii)
above, a reading of the latest available interim financial
statements of the Company, and of all subsidiaries of the Company
for which such interim financial statements are provided,
inquiries of officials of the Company and of such subsidiaries
who have responsibility for financial and accounting matters and
other specified procedures, nothing came to their attention that
caused them to believe that with respect to the unaudited
financial statements, for all periods prior to and including July
3, 1999, included in the Registration Statement, that any
material modifications should be made to such unaudited financial
statements for them to be in conformity with generally accepted
accounting principles;
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other financial
information contained in the Registration Statement (in each case
to the extent that such dollar amounts, percentages and other
financial information are derived from the general accounting
records of the Company and its subsidiaries subject to the
internal controls of the Company's accounting system or are
derived directly from such records by analysis or computation)
with the results obtained from inquiries, a reading of such
general accounting records and other procedures specified in such
letter and have found such dollar amounts, percentages and other
financial information to be in agreement with such results,
except as otherwise specified in such letter; and
(v) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a review
of management's discussion and analysis of financial condition
and results of operations as described in Statement of Auditing
Standards No. 86, Management's Discussion and Analysis, on
certain specified portions of the Management's Discussion and
Analysis of Financial Condition and Results of Operations section
of the Registration Statement.
20
(c) If the Effective Time of the Initial Registration Statement is not
prior to the execution and delivery of this Agreement, such Effective Time
shall have occurred not later than 10:00 P.M., Eastern Standard Time, on
the date of this Agreement or such later date as shall have been consented
to by the Underwriter. If the Effective Time of the Additional Registration
Statement (if any) is not prior to the execution and delivery of this
Agreement, such Effective Time shall have occurred not later than 10:00
A.M., New York time, on the business day following the date of this
Agreement or, if earlier, the time the Prospectus is printed and
distributed to the Underwriter, or shall have occurred at such later date
as shall have been consented to by the Underwriter. If the Effective Time
of the Initial Registration Statement is prior to the execution and
delivery of this Agreement, the Prospectus shall have been filed with the
Commission in accordance with the Rules and Regulations and Section 5(a) of
this Agreement. Prior to such Closing Date, no stop order suspending the
effectiveness of a Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or, to the
knowledge of any Selling Shareholder, the Company or the Underwriter, shall
be contemplated by the Commission.
(d) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred (i) any change, or any development or event
involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Company or its
subsidiaries which, in the reasonable judgment of the Underwriter, is
material and adverse and makes it impractical or inadvisable to proceed
with completion of the public offering or the sale of and payment for the
Offered Securities; (ii) any downgrading in the rating of any debt
securities of the Company by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act), or
any public announcement that any such organization has under surveillance
or review its rating of any debt securities of the Company (other than an
announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating); (iii) any
suspension or material limitation of trading in securities generally on the
New York Stock Exchange, the American Stock Exchange or the Nasdaq National
Market, or any establishment of minimum or maximum prices for trading, or
any requirement of maximum ranges for prices for securities, on such
exchange or the Nasdaq National Market, or by such exchange or other
regulatory body or governmental authority having jurisdiction (other than
limitations on price fluctuations or minimums or maximums in effect as of
the date of this Agreement); (iv) any banking moratorium declared by
federal or state authorities, or any moratorium declared in foreign
exchange trading by major international banks or persons; or (v) any
outbreak or escalation of armed hostilities involving the United States on
or after the date hereof, or if there has been a declaration by the United
States of a national emergency or war, the effect of which shall be, in the
Underwriter's reasonable judgment, to make it inadvisable or impracticable
to proceed with the public offering or delivery of the Offered Securities
on the terms and in the manner contemplated in the Prospectus.
21
(e) The Underwriter shall have received an opinion, dated the Closing
Date, of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, counsel for the Company and certain Selling
Shareholders, that:
(i) Each of the Company and ICS Technologies, Inc. ("Delaware
Sub") (A) is duly incorporated and is validly existing as a
corporation in good standing under the laws of its jurisdiction of
incorporation, (B) has all requisite corporate power and authority to
carry on its business as it is currently being conducted and as
described in the Prospectus and to own, lease and operate its
properties, and (C) is duly qualified and in good standing as a
foreign corporation, authorized to do business in each jurisdiction
set forth beside such entity's name on a schedule to such opinion;
(ii) To such counsel's knowledge, except as disclosed in the
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 owned or to be owned by
such person or to require the Company to include such securities in
the securities registered pursuant to a Registration Statement or in
any securities being registered pursuant to any other registration
statement filed by the Company under the Act;
(iii) To such counsel's knowledge, all of the outstanding shares
of capital stock of Delaware Sub have been duly authorized and validly
issued and are fully paid and non-assessable, and are owned by the
Company, directly or indirectly through one or more subsidiaries, free
and clear of any adverse claim. The term "adverse claim" as used in
such opinion has the meaning given such term in Article 8 of the
Uniform Commercial Code and does not include (i) any claim which
arises through you or any person claiming through you (such as any
security interest you may have granted in the shares) and (ii) any
adverse interest which would not be extinguished upon the purchase of
the Offered Securities by a person who qualifies as a "bona fide
purchase" or "protected purchase" under Section 8-303 of the Uniform
Commercial Code. We advise you that we have no actual knowledge of the
existence of any interest of the kind specified in clause (ii) of the
preceding sentence.
(iv) To the knowledge of such counsel, the Company was not
required under any New York, Pennsylvania or federal law to obtain any
consent, approval, authorization or order of any governmental agency
for the consummation of the transactions contemplated by this
Agreement in connection with the sale of the Offered Securities,
except for any such consent, approval, authorization or order which
may be required under the
22
so-called "Blue Sky" or securities laws of any states (as to which
such counsel need express no opinion or advice);
(v) The execution, delivery and performance of the Custody
Agreement and this Agreement and the consummation of the transactions
therein and herein contemplated will not constitute a violation by the
Company of any applicable provision of any New York, Pennsylvania or
federal law, statute or regulation (except that such counsel need
express no opinion in this paragraph as to compliance with any
disclosure requirement or any prohibition against fraud or
misrepresentation or as to whether performance of the indemnification
or contribution provisions in this Agreement would be permitted);
(vi) The Company's execution and delivery of this Agreement and
the performance of its agreements in this Agreement and the
consummation of the sale of the Offered Securities to you in
accordance with this Agreement do not (i) constitute a violation by
the Company or Delaware Sub of any applicable provision of New York,
Pennsylvania or federal law, statute or regulation or the Delaware
General Corporate Law (except that we express no opinion in this
paragraph as to compliance with any disclosure requirement or any
prohibition against fraud or misrepresentation or as to whether
performance of the indemnification or contribution provisions in this
Agreement would be permitted) or (ii) breach, or result in a default
under, any existing obligation of the Company or Delaware Sub under
any of the agreements listed on a schedule to an officers' certificate
relating to such opinion (provided that such counsel need not express
any opinion as to compliance with any financial test or cross default
provision in any such agreement).
(vii) Except as listed on a schedule to an officers' certificate
relating to such opinion, to such counsel's knowledge, there is no
action, suit, proceeding or investigation before or by any federal,
Pennsylvania or Delaware court or governmental agency or body,
domestic or foreign, pending or threatened against, the Company that
(i) has caused such counsel to conclude that such action, suit,
proceeding or investigation is required by Regulation S-K under the
Securities Act to be described in the Registration Statement but is
not described in the Prospectus or (ii) would be reasonably likely to
adversely affect the consummation of any of the transactions
contemplated by this Agreement. We have no knowledge about any
contract to which the Company is a party or to which any of its
property is subject that has caused us to conclude that such contract
is required to be described in the Prospectus but is not so described
or is required to be filed as an exhibit to the Registration Statement
but has not been so filed.
23
(viii) The Company is not an "investment company" within the
meaning of the Investment Company Act;
(ix) To such counsel's knowledge, there is no stop order
preventing the use of the Prospectus or the Registration Statements,
or any amendments or supplements thereto;
(x) The Initial Registration Statement was declared effective
under the Act as of the date and time specified in such opinion, the
Additional Registration Statement (if any) was filed and became
effective under the Act as of the date and time (if determinable)
specified in such opinion and the Prospectus either was filed with the
Commission pursuant to the subparagraph of Rule 424(b) specified in
such opinion on the date specified therein or was included in the
Initial Registration Statement or the Additional Registration
Statement (as the case may be).
Such counsel's opinion letter shall also contain the following language:
"Based upon our participation in the conferences identified in the
preceding paragraph, our understanding of applicable law and the
experience we have gained in our practice thereunder and relying as to
materiality to a large extent upon the opinions and statements of
officers of the Company, we can, however, advise you that nothing has
come to our attention that has caused us to conclude that (i) the
Registration Statement at its effective date and the Closing Date
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 or (ii) the Prospectus at the date
it bears or on the Closing Date contained an untrue statement of a
material fact or omitted to state a material fact necessary in order
to make the statements therein, in light of the circumstances under
which they were made, not misleading or (iii) as of the effective date
either the Registration Statement or the Prospectus appeared on its
face not to be responsive in all material respects to the requirements
of the Act and the Rules and Regulations; it being understood that we
make no such statement in the case of clauses (i)-(iii) with respect
to the financial statements and schedules and other financial or
related statistical data included in the Registration Statement or the
Prospectus or omitted therefrom."
(xi) This Agreement has been duly and validly authorized,
executed and delivered by the Company;
24
(xii) The Offered Securities delivered on such Closing Date and
all other outstanding shares of Common Stock of the of the Company
have been duly authorized and validly issued, are fully paid and
nonassessable and conform to the description thereof contained in the
Prospectus, and the issuance of the Offered Securities is not subject
to preemptive or other similar rights arising under the Pennsylvania
Business Corporation Law of 1988; and
(xiii) Neither (A) the execution, delivery or performance by the
Company of this Agreement or (B) the issuance and sale of the Offered
Securities violates, conflicts with or constitutes a breach of any of
the terms or provisions of, or a default under (or an event that with
notice or the lapse of time, or both, would constitute a default
under), or requires consent under, or results in the imposition of a
lien or encumbrance on any properties of the Company or any of the
Significant Subsidiaries, or an acceleration of any indebtedness of
the Company or any of the Significant Subsidiaries pursuant to, (1)
the articles of incorporation or bylaws of the Company, (2) any
statute, rule or regulation of the Commonwealth of Pennsylvania
applicable to the Company or any of the Significant Subsidiaries or
any of their assets or properties or (3) to the best of such counsel's
knowledge, any judgment, order or decree known to such counsel of any
court or governmental agency or authority of the Commonwealth of
Pennsylvania having jurisdiction over the Company or any of the
Significant Subsidiaries or any of their assets or properties.
Assuming compliance with applicable federal, state and foreign
securities and Blue Sky laws, as to which no opinion is rendered
hereby, to the best of such counsel's knowledge, no consent, approval,
authorization or order of, or filing, registration, qualification,
license or permit of or with, (A) any Pennsylvania court or
governmental agency, body or administrative agency or (B) any other
person is required for (1) the execution, delivery and performance by
the Company or any of the Significant Subsidiaries of this Agreement
or (2) the issuance and sale of the Offered Securities, except such as
have been obtained and made or have been disclosed in the Prospectus.
(f) The Underwriter shall have received the opinion contemplated in
the Power of Attorney executed and delivered by each Selling Shareholder
dated such Closing Date, and an opinion dated the applicable Optional
Closing Date, of counsel for the Selling Shareholders, to the effect that:
(i) To such counsel's knowledge, all of the Offered Securities
being sold by such Selling Shareholder hereunder are owned by such
Selling Shareholder directly or indirectly through one or more
subsidiaries, free and clear of any adverse claim. Upon your payment
to the Custodian of the purchase price specified in this Underwriting
Agreement and the delivery to you of the certificate or certificates
representing the Offered Securities upon consummation
25
of the sale thereof in accordance with the Underwriting Agreement, you
will have acquired ownership of the Offered Securities free and clear
of any adverse claim. The term "adverse claim" as used in such opinion
has the meaning given such term in Article 8 of the Uniform Commercial
Code and does not include (i) any claim which arises through you or
any person claiming through you (such as any security interest you may
have granted in the shares) and (ii) any adverse interest which would
not be extinguished upon the purchase of the Offered Securities by a
person who qualifies as a "bona fide purchase" or "protected purchase"
under Section 8-303 of the Uniform Commercial Code. We advise you that
we have no actual knowledge of the existence of any interest of the
kind specified in clause (ii) of the preceding sentence;
(ii) This Agreement has been duly authorized, executed and
delivered on behalf of such Selling Shareholder;
(iii) The Custody Agreement and the Power of Attorney with
respect to such Selling Shareholder have been duly authorized (if such
selling shareholder is not an individual), executed and delivered by
such Selling Shareholder and constitute valid and legally binding
obligations of such Selling Shareholder enforceable in accordance with
their respective terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to
general equity principles;
(iv) To the knowledge of such counsel such Selling Shareholder
was not required under any New York or federal law to obtain any
consent, approval, authorization or order of any governmental agency
for the consummation of the transactions contemplated by this
Agreement or the Custody Agreement in connection with the sale of the
Offered Securities, except for any such consent, approval,
authorization or order which may be required under the Act or under
the so-called "Blue Sky" or securities laws of any states (as to which
such counsel need express no opinion or advice); and
(v) The execution, delivery and performance of this Agreement,
the Custody Agreement and the Power of Attorney by such Selling
Shareholder and the consummation of the transactions herein and
therein contemplated will not conflict with or result in a breach or
violation of any of the terms and provisions of, or constitute a
default under (A) to the knowledge of such counsel, any statute, any
rule, regulation or order of any governmental agency or body or any
court, domestic or foreign, having jurisdiction over such Selling
Shareholder or any of its properties or operations, or any agreement
or instrument to which such Selling Shareholder is a party or by which
such Selling Shareholder is bound or to which any of the properties or
operations of such Selling Shareholder
26
is subject, or (B) if applicable, the charter, by-laws or other
organizational documents of such Selling Shareholder except, in the
case of clause (A), for such conflicts, breaches, violations or
defaults which could not reasonably be expected to, individually or in
the aggregate, have a material adverse effect on the consummation of
the transactions contemplated by this Agreement, the Custody Agreement
or the Power of Attorney.
(g) The Underwriter shall have received from Skadden, Arps, Slate,
▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for the Underwriter, such opinion or opinions,
dated as of the Closing Date, with respect to the validity of the Offered
Securities delivered on such Closing Date, the Registration Statements, the
Prospectus and other related matters as the Underwriter may require,
and the Selling Shareholders and the Company shall have furnished to such
counsel such documents as they request for the purpose of enabling them to
pass upon such matters.
(h) The Underwriter shall have received from each shareholder of the
Company listed on Schedule D, in the form attached as Exhibit I hereto, a
letter agreement stating that such shareholder agrees, for a period of 90
days after the date of the public offering of the Offered Securities, not
to offer, sell, contract to sell, pledge or otherwise dispose of, directly
or indirectly, any additional shares of the Securities of the Company or
securities convertible into or exchangeable or exercisable for any shares
of Securities, or publicly disclose the intention to make any such offer,
sale, pledge or disposal, without the prior written consent of the
Underwriter, except as stated otherwise in such letter.
(i) The Underwriter shall have received a certificate, dated such
Closing Date, of the President or any Vice President and a principal
financial or accounting officer of the Company in which such officers shall
state that: the representations and warranties of the Company in this
Agreement are true and correct; the Company has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied hereunder at or prior to such Closing Date; no stop order
suspending the effectiveness of any Registration Statement has been issued
and no proceedings for that purpose have been instituted or are
contemplated by the Commission; the Additional Registration Statement (if
any) satisfying the requirements of subparagraphs (1) and (3) of Rule
462(b) was filed pursuant to Rule 462(b), including payment of the
applicable filing fee in accordance with Rule 111(a) or (b) under the Act,
prior to the time the Prospectus was printed and distributed to any
Underwriter; and, subsequent to the date of the most recent financial
statements in the Prospectus, there has been no material adverse change,
nor any development or event involving a prospective material adverse
change, in the condition (financial or other), business, properties or
results of operations of the Company and its subsidiaries taken as a whole
except as set forth in or contemplated by the Prospectus or as described in
such certificate.
27
(j) The Underwriter shall have received a letter, dated the Closing
Date, of PricewaterhouseCoopers LLP which meets the requirements of
subsection (a) of this Section, except that the specified date referred to
in such subsection will be a date not more than three business days prior
to the Closing Date for the purposes of this subsection.
(k) The Securities to be delivered on such Closing Date are listed on
the Nasdaq National Market.
The Selling Shareholders and the Company will furnish the Underwriter
with such conformed copies of such opinions, certificates, letters and
documents as the Underwriter reasonably requests. The Underwriter may in its
sole discretion waive on behalf of the Underwriter compliance with any
conditions to the obligations of the Underwriter hereunder, whether in respect
of an Optional Closing Date or otherwise.
7. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless the Underwriter, its
partners, directors and officers and each person, if any, who controls the
Underwriter within the meaning of Section 15 of the Act, against any
losses, claims, damages or liabilities, joint or several, to which the
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 upon any untrue statement or alleged untrue
statement of any material fact contained in any Registration Statement, the
Prospectus, or any amendment or supplement thereto, or any related
preliminary prospectus, or arise out of or are based upon the omission or
alleged omission to state therein or necessary to make the statements
therein not misleading, including any losses, claims, damages or
liabilities arising out of or based upon the Company's failure to perform
its obligations under Section 5(a) of this Agreement, and will reimburse
the Underwriter for any legal or other expenses reasonably incurred by
the Underwriter in connection with investigating or defending any such
loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that (i) the Company will not be liable in any such case
to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement in or
omission or alleged omission from any of such documents in reliance upon
and in conformity with written information furnished to the Company by any
Underwriter through the Underwriter specifically for use therein, it
being understood and agreed that the only such information furnished by the
Underwriter consists of the information described as such in subsection (c)
below and (ii) that the Company shall not be liable to the Underwriter
with respect to any untrue statement or alleged untrue statement or
omission or alleged omission in the preliminary prospectus to the extent
that any such loss, liability, claim, damage or expense of the Underwriter
results from the fact that the Underwriter sold Offered Securities to a
person to whom there was not sent or
28
given, at or prior to the written confirmation of such sale, a copy of the
Prospectus as then amended or supplemented if the Company had previously
furnished copies thereof to the Underwriter and the loss, liability, claim,
damage or expense of the Underwriter results from an untrue statement or
omission of a material fact contained in the preliminary prospects which
was corrected in the Prospectus.
Insofar as the foregoing indemnity agreement, or the
representations and warranties contained in Section 2(a)(ii), may permit
indemnification for liabilities under the Act of any person who is an
Underwriter or a partner or controlling person of an Underwriter within the
meaning of Section 15 of the Act and who, at the date of this Agreement, is
a director, officer or controlling person of the Company, the Company has
been advised that in the opinion of the Commission such provisions may
contravene Federal public policy as expressed in the Act and may therefore
be unenforceable. In the event that a claim for indemnification under such
agreement or such representations and warranties for any such liabilities
(except insofar as such agreement provides for the payment by the Company
of expenses incurred or paid by a director, officer or controlling person
in the successful defense of any action, suit or proceeding) is asserted by
such a person, the Company will submit to a court of appropriate
jurisdiction (unless in the opinion of counsel for the Company the matter
has already been settled by controlling precedent) the question of whether
or not indemnification by it for such liabilities is against public policy
as expressed in the Act and therefore unenforceable, and the Company will
be governed by the final adjudication of such issue.
(b) Each Selling Shareholder will severally and not jointly indemnify
and hold harmless the Underwriter against any losses, claims, damages or
liabilities, joint or several, to which the 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 upon any untrue statement or alleged untrue statement of any material
fact contained in any Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any related preliminary prospectus, or
arise out of or are based upon the omission or alleged omission therein of
a material fact required to be stated therein or necessary to make the
statements therein, not misleading, and will reimburse the Underwriter for
any legal or other expenses reasonably incurred by the Underwriter in
connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred in each case only 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 in or omission
or alleged omission from any of such documents in reliance upon and in
conformity with written information furnished by such Selling Shareholder
specifically for use therein; provided, however, that the Selling
Shareholders will not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement in or omission or alleged
omission from any of such documents in reliance upon and in conformity with
written information furnished to the Company by the
29
Underwriter, it being understood and agreed that the only such information
furnished by the Underwriter consists of the information described as such
in subsection (c) below; provided, further, that no Selling Shareholder
shall be liable to the Underwriter with respect to any untrue statement or
alleged untrue statement or omission or alleged omission in the preliminary
prospectus to the extent that any such loss, liability, claim, damage or
expense of the Underwriter results from the fact that the Underwriter sold
Offered Securities to a person to whom there was not sent or given, at or
prior to the written confirmation of such sale, a copy of the Prospectus as
then amended or supplemented if the Company had previously furnished copies
thereof to the Underwriter and the loss, liability, claim, damage or
expense of the Underwriter results from an untrue statement or omission of
a material fact contained in the preliminary prospects which was corrected
in the Prospectus. Notwithstanding the foregoing, the aggregate liability
of any Selling Shareholder pursuant to the provisions of this paragraph
shall be limited to an amount equal to the aggregate sale price received by
such Selling Shareholder from the sale of such Selling Shareholder's shares
hereunder.
(c) The Underwriter will indemnify and hold harmless the Company, its
directors and officers and each person, if any, who controls the Company
within the meaning of Section 15 of the Act, and each Selling Shareholder
against any losses, claims, damages or liabilities to which the Company or
such Selling Shareholder 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 any untrue statement or
alleged untrue statement of any material fact contained in any Registration
Statement, the Prospectus, or any amendment or supplement thereto, or any
related preliminary prospectus, or arise out of or are based upon the
omission or the alleged omission therein of 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 reliance upon and in conformity with written information furnished
to the Company by such Underwriter through the Representatives specifically
for use therein, and will reimburse any legal or other expenses reasonably
incurred by the Company and each Selling Shareholder in connection with
investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred, it being understood and agreed that
the only such information furnished by the Underwriter consists of (i) the
following information in the Prospectus furnished on behalf of the
Underwriter: the concession and reallowance figures appearing in the third
paragraph under the caption "Underwriting" and the over-allotments and
stabilizing descriptions appearing in the twelfth and thirteenth paragraphs
under the caption "Underwriting" and (ii) the following information in the
Prospectus furnished on behalf of the Underwriter:
30
["▇▇▇▇▇▇ BROTHERS INC. AND ITS RESPECTIVE AFFILIATES HAVE PERFORMED
AND EXPECT TO CONTINUE TO PERFORM FINANCIAL ADVISORY AND INVESTMENT
AND COMMERCIAL BANKING SERVICES FOR US FOR WHICH THEY HAVE RECEIVED
AND WILL RECEIVE CUSTOMARY COMPENSATION. ▇▇▇▇ ▇. ▇▇▇▇▇▇, A DIRECTOR OF
OUR COMPANY, IS A SENIOR MANAGING DIRECTOR OF BEAR, ▇▇▇▇▇▇▇ & CO.
INC."]
(d) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party shall,
if a claim in respect thereof is to be made against an indemnifying party
under subsection (a), (b) or (c) above notify each party against whom
indemnification is to be sought in writing of the commencement thereof; but
the failure so to notify an indemnifying party shall not relieve it from
any liability which it may have under this Section except to the extent
that it has been prejudiced in any material respect by such failure or from
any liability which it may have otherwise than under subsection (a), (b) or
(c) above. In case any such action is brought against any indemnified
party, and it notifies an indemnifying party of the commencement thereof,
the indemnifying party will be entitled to participate therein, and to the
extent it may elect by written notice delivered to the indemnified party
promptly after receiving the aforesaid notice from such indemnified party,
to assume the defense thereof with counsel reasonably satisfactory to such
indemnified party. Notwithstanding the foregoing, the indemnified party or
parties shall have the right to employ its or their own counsel in any such
case, but the fees and expenses of such counsel shall be at the expense of
such indemnified party or parties unless (i) the employment of such counsel
shall have been authorized in writing by the indemnifying parties in
connection with the defense of such action, (ii) the indemnifying parties
shall not have employed counsel to take charge of the defense of such
action within a reasonable time after notice of commencement of the action,
or (iii) such indemnified party or parties shall have reasonably concluded
that there may be defenses available to it or them which are different from
or additional to those available to one or all of the indemnifying parties
(in which case the indemnifying party or parties shall not have the right
to direct the defense of such action on behalf of the indemnified party or
parties), in any of which events such fees and expenses of counsel shall be
borne by the indemnifying parties; provided, however, that the indemnifying
party under subsection (a) or (b) above shall only be liable for the legal
expenses of one counsel (in addition to any local counsel) for all
indemnified parties in each jurisdiction in which any claim or action is
brought. No indemnifying party shall, without prior written consent of the
indemnified party, effect any settlement of any pending or threatened
action in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified
party unless such settlement includes an unconditional release of such
indemnified party from all liability
31
on any claims that are the subject matter of such action and does not
include a statement as to and an admission of fault, culpability or failure
to act by or on behalf of any indemnified party. Anything in this
subsection to the contrary notwithstanding, an indemnifying party shall not
be liable for any settlement of any claim or action effected without its
prior written consent, provided that such consent was not unreasonably
withheld, and that if at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and
expenses of counsel, such indemnifying party agrees it shall be liable for
any settlement effected without its written consent if (i) such settlement
is entered into more than 45 days after receipt by such indemnifying party
of the aforesaid request, (ii) such indemnifying party shall have received
notice of the terms of such settlement at least 30 days prior to such
settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request
prior to the date of such settlement.
(e) If the indemnification provided for in this Section is unavailable
or insufficient to hold harmless an indemnified party under subsection (a),
(b) or (c) above, then each indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a), (b) or (c)
above (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Selling Shareholders on the one
hand and the Underwriters on the other from the offering of the Securities
or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only
the relative benefits referred to in clause (i) above but also the relative
fault of the Company and the Selling Shareholders 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 as well as
any other relevant equitable considerations. The relative benefits received
by the Company and the Selling Shareholders 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 Shareholders bear to the total
underwriting discounts and commissions received by the Underwriters. 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, the Selling Shareholders or the
Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission. The amount paid by an indemnified party as a result of the
losses, claims, damages or liabilities referred to in the first sentence of
this subsection (e) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim which is the subject of this
subsection (e). Notwithstanding the provisions of this subsection (e), (i)
no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by it
and distributed to the
32
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 and (ii)
no Selling Shareholder shall be required to contribute any amount in excess
of the amount by which the aggregate sale price received by such Selling
Shareholder from the sale of the Offered Securities hereunder exceeds the
amount of any damages or indemnification which such Selling Shareholder 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 (e) to contribute are several in proportion to their respective
underwriting obligations and not joint. The Selling Shareholders'
obligations in this subsection (e) to contribute are several and not joint.
(f) The obligations of the Company and the Selling Shareholders under
this Section shall be in addition to any liability which the Company and
the Selling Shareholders 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 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 director of the Company, to each officer of
the Company who has signed a Registration Statement and to each person, if
any, who controls the Company within the meaning of the Act.
8. Reserved.
33
9. Reserved.
10. Notices. All communications hereunder will be in writing and, if sent
to the Underwriters, will be mailed, delivered or telegraphed and confirmed to
▇▇▇▇▇▇ Brothers Inc., Three World Financial Center, New York, New York 10285,
Attention: [___________________________], or, if sent to the Company, will be
mailed, delivered or telegraphed and confirmed to it at Integrated Circuit
Systems, Inc., ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇,
Attention: Chief Financial Officer, with a copy to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, 3000 Two
▇▇▇▇▇ Square, ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, or, if sent to the Selling Shareholders or any of
them, will be mailed, delivered or telegraphed and confirmed to
[____________________________________________________________________________],
Attention:[__________________________________________], provided, however, that
any notice to the Underwriter pursuant to Section 7 or Section 9 will be mailed,
delivered or telegraphed and confirmed to such Underwriter.
11. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective personal representatives and
successors and the officers and directors and controlling persons referred to in
Section 7, and no other person will have any right or obligation hereunder.
34
12. Representation. [______________________] and [______________________]
will act for the Selling Shareholders in connection with such transactions, and
any action under or in respect of this Agreement taken by
[____________________________] or [________________________] will be binding
upon all the Selling Shareholders.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement. Delivery by
telecopy or facsimile transmission of an executed counterpart of this Agreement
shall be considered due and sufficient delivery.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS.
THE COMPANY AND EACH SELLING SHAREHOLDER HEREBY SUBMIT TO THE NON-EXCLUSIVE
JURISDICTION OF THE FEDERAL AND STATE COURTS IN THE BOROUGH OF MANHATTAN IN THE
CITY OF NEW YORK IN ANY SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
35
If the foregoing is in accordance with the Underwriter's understanding of
our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement among the Selling
Shareholders, the Company and the Underwriter in accordance with its terms.
Very truly yours,
INTEGRATED CIRCUIT SYSTEMS, INC.
-------------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
Under Power of Attorney for Each of the Above
Persons
The foregoing Underwriting Agreement
is hereby confirmed and accepted as of
the date first above written.
By: ▇▇▇▇▇▇ BROTHERS INC.
----------------------------------------
Name:
Title:
SCHEDULE A
SELLING SHAREHOLDERS OF FIRM SECURITIES
NUMBER OF OPTIONAL
Securities to be Sold
--------------------------
TOTAL OPTION SHARES
A-1
SCHEDULE B
SELLING SHAREHOLDERS OF OPTIONAL SECURITIES
PRIORITY SECURITIES
NON-PRIORITY SECURITIES
B-1
SCHEDULE C
UNDERWRITERS
NUMBER OF
FIRM SECURITIES
UNDERWRITER TO BE PURCHASED
----------- ---------------
▇▇▇▇▇▇ Brothers Inc.......................................
C-1
SCHEDULE D [TO BE UPDATED]
▇-▇
▇-▇
EXHIBIT I
FORM OF LOCK-UP AGREEMENT
___________, 2001
Integrated Circuit Systems, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Justine ▇▇▇▇
▇▇▇▇▇▇ BROTHERS INC.
Three World Financial Center
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
As an inducement to the Underwriters to execute the Underwriting
Agreement, pursuant to which a public offering will be made of the Common Stock,
par value $.01 per share (the "SECURITIES") of Integrated Circuit Systems, Inc.
(the "COMPANY"), the undersigned hereby agrees that from the date hereof and
until [60/90] days after the public offering date set forth on the final
prospectus used to sell the Securities (the "PUBLIC OFFERING DATE") pursuant to
the Underwriting Agreement, to which you are or expect to become parties, the
undersigned will not offer, sell, contract to sell, pledge or otherwise dispose
of, directly or indirectly, any shares of Securities or securities convertible
into or exchangeable or exercisable for any shares of Securities, enter into a
transaction which would have the same effect, or enter into any swap, hedge or
other arrangement that transfers, in whole or in part, any of the economic
consequences of ownership of the Securities, whether any such aforementioned
transaction is to be settled by delivery of the Securities or such other
securities, in cash or otherwise, or publicly disclose the intention to make any
such offer, sale, pledge or disposition, or to enter into any such transaction,
swap, hedge or other arrangement, without, in each case, the prior written
consent of ▇▇▇▇▇▇ Brothers Inc. In addition, the undersigned agrees that,
without the prior written consent of ▇▇▇▇▇▇ Brothers Inc., it will not, during
the period commencing on the date hereof and ending [60/90] days after the
Public Offering Date, make any demand for or exercise any right with respect to,
the registration of any Securities or any security convertible into or
exercisable or exchangeable for the Securities.
The undersigned shall not be restricted by the terms of this Agreement
from exercising any options granted to the undersigned; provided, however, that
any Securities received upon exercise of options granted to the undersigned will
be subject to this Agreement. Any Securities acquired by the undersigned in the
open market will not be subject to this Agreement. A transfer of
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Securities to a family member or trust may be made, provided the transferee
agrees to be bound in writing by the terms of this Agreement.
In furtherance of the foregoing, the Company and its transfer agent and
registrar are hereby authorized to decline to make any transfer of shares of
Securities if such transfer would constitute a violation or breach of this
Agreement.
This Agreement shall be binding on the undersigned and the successors,
heirs, personal representatives and assigns of the undersigned. This Agreement
shall lapse and become null and void if the Public Offering Date shall not have
occurred on or before July 31, 2001.
Very truly yours,
---------------------------------
[Name of non-selling stockholder]
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