Oppenheimer
& Co. Inc.
300 Madison Avenue
New York, New York 10017
Conexant Systems,
Inc., a Delaware corporation (the “Company”) proposes,
subject to the terms and conditions contained herein, to sell to
you (the “Underwriter”) an aggregate of 7,000,000
shares (the “Firm Shares”) of the Company’s
common stock, par value $0.01 per share (the “Common
Stock”). In addition, the Company proposes to grant to the
Underwriter an option to purchase up to an additional 1,050,000
shares (the “Option Shares”) of Common Stock from the
Company solely for the purpose of covering over allotments in
connection with the sale of the Firm Shares. The Firm Shares and
the Option Shares are collectively called the
“Shares.”
The Company has
prepared and filed in conformity with the requirements of the
Securities Act of 1933, as amended (the “Securities
Act”), and the published rules and regulations thereunder
(the “Rules”) adopted by the Securities and Exchange
Commission (the “Commission”) a registration statement
on Form S-3 declared effective by the Commission on July 27,
2009 (No. 333-160637), including a related prospectus dated
July 27, 2009 (the “Base Prospectus”) relating to
Common Stock, preferred stock, warrants and units of the Company
that may be sold by the Company from time to time in accordance
with Rule 415 of the Securities Act, and such amendments
thereof to the date of this Agreement. Copies of such registration
statement (including all amendments thereof and all documents
deemed incorporated by reference therein) and of the related Base
Prospectus have heretofore been delivered by the Company or are
otherwise available to you.
The term
“Registration Statement” as used in this Agreement
means the registration statement referred to in the preceding
paragraph (including all exhibits, financial schedules and all
documents and information deemed to be a part of the Registration
Statement through incorporation by reference or otherwise), as
amended from time to time, including the information (if any)
contained in the form of final prospectus supplement filed with the
Commission pursuant to Rule 424(b) of the Rules and deemed to be
part thereof at the time of effectiveness pursuant to Rule 430B of
the Rules.
If the Company has
filed an abbreviated registration statement to register additional
Shares pursuant to Rule 462(b) under the Rules (the “462(b)
Registration Statement”), then any
reference
herein to the Registration Statement shall also be deemed to
include such 462(b) Registration Statement. The term
“Preliminary Prospectus” means the Base Prospectus and
any preliminary prospectus supplement used or filed with the
Commission pursuant to Rule 424 of the Rules, in the form
provided to the Underwriter by the Company for use in connection
with the offering of the Shares. The term “Prospectus”
means the Base Prospectus, any Preliminary Prospectus and any
amendments or further supplements to such prospectus, and
including, without limitation, the final prospectus supplement,
filed pursuant to and within the limits described in Rule 424(b)
with the Commission in connection with the proposed sale of the
Shares contemplated by this Agreement through the date of such
prospectus supplement. The term “Effective Date” shall
mean each date that the Registration Statement and any
post-effective amendment or amendments thereto became or become
effective. Unless otherwise stated herein, any reference herein to
the Registration Statement, any Preliminary Prospectus, the
Statutory Prospectus (as hereinafter defined) and the Prospectus
shall be deemed to refer to and include the documents incorporated
by reference therein, including pursuant to Item 12 of Form
S-3 under the Securities Act, which were filed under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)
on or before the date hereof or are so filed hereafter. Any
reference herein to the terms “amend,”
“amendment” or “supplement” with respect to
the Registration Statement, any Preliminary Prospectus, the
Statutory Prospectus, or the Prospectus shall be deemed to refer to
and include any such document filed or to be filed (but shall not
include any document or information deemed to be furnished) under
the Exchange Act after the date of the Registration Statement, any
such Preliminary Prospectus, the Statutory Prospectus or the
Prospectus, as the case may be, and deemed to be incorporated
therein by reference.
The Company
understands that the Underwriter proposes to make a public offering
of the Shares, as set forth in and pursuant to the Statutory
Prospectus and the Prospectus, as soon after the date of this
Agreement as the Underwriter deems advisable. The Company hereby
confirms that the Underwriter and dealers have been authorized to
distribute or cause to be distributed each Preliminary Prospectus,
and each Issuer Free Writing Prospectus (as hereinafter defined)
and are authorized to distribute the Prospectus (as from time to
time amended or supplemented if the Company furnishes amendments or
supplements thereto to the Underwriter).
1.
Sale, Purchase, Delivery and Payment for the Shares . On the
basis of the representations, warranties and agreements contained
in, and subject to the terms and conditions of, this
Agreement:
(a) The Company
agrees to issue and sell to the Underwriter, and the Underwriter
agrees to purchase from the Company, at a purchase price of
$2.69325 per share (the “Initial Price”), the Firm
Shares.
(b) The Company
hereby grants to the Underwriter an option to purchase all or any
part of the Option Shares at the Initial Price. Such option may be
exercised only to cover over-allotments in the sales of the Firm
Shares by the Underwriter and may be exercised in whole or in part
at any time (but not more than once) on or before 12:00 noon, New
York City time, on the business day before the Firm Shares Closing
Date (as defined below), and from time to time thereafter within 30
days after the date of this Agreement, in each case upon written,
facsimile or telegraphic notice, or verbal or telephonic notice
confirmed by written, facsimile or telegraphic notice, by the
Underwriter to the Company no later than 12:00 noon, New
York
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City time, on
the business day before the Firm Shares Closing Date or at least
two business days before the Option Shares Closing Date (as defined
below), as the case may be, setting forth the number of Option
Shares to be purchased and the time and date (if other than the
Firm Shares Closing Date) of such purchase.
(c) Payment of the
purchase price for, and delivery of certificates for, the Firm
Shares shall be made at the offices of Oppenheimer & Co. Inc.,
300 Madison Avenue, New York, New York 10017, at 10:00 a.m.,
New York City time, on the third business day following the date of
this Agreement or at such time on such other date, not later than
ten (10) business days after the date of this Agreement, as
shall be agreed upon by the Company and the Underwriter (such time
and date of delivery and payment are called the “Firm Shares
Closing Date”). In addition, in the event that any or all of
the Option Shares are purchased by the Underwriter, payment of the
purchase price, and delivery of the certificates, for such Option
Shares shall be made at the above-mentioned offices, or at such
other place as shall be agreed upon by the Underwriter and the
Company, on each date of delivery as specified in the notice from
the Underwriter to the Company (such time and date of delivery and
payment are called the “Option Shares Closing Date”).
The Firm Shares Closing Date and any Option Shares Closing Date are
called, individually, a “Closing Date” and, together,
the “Closing Dates.”
(d) Payment shall
be made to the Company by wire transfer of immediately available
funds or by certified or official bank check or checks payable in
New York Clearing House (same day) funds drawn to the order of the
Company, against delivery of the certificates to the Underwriter
for the Shares to be purchased by the Underwriter.
(e) Certificates
evidencing the Shares shall be registered in such names and shall
be in such denominations as the Underwriter shall request at least
two full business days before the Firm Shares Closing Date or, in
the case of Option Shares, on the day of notice of exercise of the
option as described in Section 1(b) and shall be delivered by or on
behalf of the Company to the Underwriter through the facilities of
the Depository Trust Company (“DTC”) for the account of
the Underwriter. The Company will cause the certificates
representing the Shares to be made available for checking and
packaging, at such place as is designated by the Underwriter, on
the full business day before the Firm Shares Closing Date (or the
Option Shares Closing Date in the case of the Option
Shares).
2.
Representations and Warranties of the Company . The Company
represents and warrants to the Underwriter as of the date hereof,
as of the Firm Shares Closing Date and as of each Option Shares
Closing Date (if any), as follows:
(a) The Company
meets the requirements for use of Form S-3 under the Securities
Act, including the transaction requirements set forth in General
Instruction 1.B.1 of such form. The Company filed with the
Commission the Registration Statement on such Form, including a
Base Prospectus, for registration under the Securities Act of the
offering and sale of the Shares, and the Company has prepared and
used a Preliminary Prospectus in connection with the offer and sale
of the Shares. When the Registration Statement or any amendment
thereof or supplement thereto was or is declared effective, it
(i) complied or will comply, in all material respects, with
the requirements of the Securities Act and the Rules and the
Exchange Act and
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the rules and
regulations of the Commission thereunder and (ii) did not or
will not, contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading.
When any Preliminary Prospectus or Prospectus was first filed with
the Commission (whether filed as part of the Registration Statement
or any amendment thereto or pursuant to Rule 424 of the Rules)
and when any amendment thereof or supplement thereto was first
filed with the Commission, such Preliminary Prospectus or
Prospectus as amended or supplemented complied in all material
respects with the applicable provisions of the Securities Act and
the Rules and did not as of the date thereof, does not (when
considered together with the Pricing Information), as of the date
hereof, and will not (when considered together with the Pricing
Information), as of the Closing Date, contain any untrue statement
of a material fact or omit to state any material fact required to
be stated therein or necessary in order to make the statements
therein not misleading. If applicable, each Preliminary Prospectus
and the Prospectus delivered to the Underwriter for use in
connection with this offering was identical to the electronically
transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T.
Notwithstanding the foregoing, none of the representations and
warranties in this paragraph 2(a) shall apply to statements in, or
omissions from, the Registration Statement, any Preliminary
Prospectus or the Prospectus made in reliance upon, and in
conformity with, information herein or otherwise furnished in
writing by the Underwriter specifically for use in the Registration
Statement, any Preliminary Prospectus or the Prospectus. With
respect to the preceding sentence, the Company acknowledges that
the only information furnished in writing by the Underwriter for
use in the Registration Statement, any Preliminary Prospectus or
the Prospectus is the statements contained in the first paragraph,
fourth sentence of the third paragraph, the ninth paragraph and the
thirteenth paragraph under the caption “Underwriting”
in the Prospectus (collectively, the “Underwriting
Information”).
(b) As of the
Applicable Time (as hereinafter defined), neither (i) the
Statutory Prospectus (as hereinafter defined), together with the
Pricing Information (as hereinafter defined) (collectively, the
“General Disclosure Package”), nor (ii) any
individual Issuer Free Writing Prospectus when considered together
with the General Disclosure Package, included any untrue statement
of a material fact or omitted to state any material fact required
to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that this representation
and warranty shall not apply to statements in or omissions in the
General Disclosure Package made in reliance upon and in conformity
with the Underwriter Information.
Each Issuer Free
Writing Prospectus (including without limitation any “bona
fide electronic road show” as defined in Rule 433(h)(5)
under the Securities Act (a “Road Show”)) (i) is
identified in Schedule II hereto and (ii) complied when
issued, and complies, in all material respects with the
requirements of the Securities Act and the Rules and the Exchange
Act and the rules and regulations of the Commission
thereunder.
As used in this
Section and elsewhere in this Agreement:
“Applicable Time” means 9:00 A.M.
(Eastern time) on the date of this Underwriting
Agreement.
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“Statutory Prospectus” as of any
time means the Preliminary Prospectus relating to the Shares
immediately prior to the Applicable Time, including any document
incorporated by reference therein immediately prior to the
Applicable Time.
“Issuer
Free Writing Prospectus” means each “free writing
prospectus” (as defined in Rule 405 of the Rules) prepared by
or on behalf of the Company or used or referred to by the Company
in connection with the offering of the Shares, including, without
limitation, each Road Show.
“Pricing
Information” means the information set forth in
Schedule III hereto.
(c) The
Registration Statement is effective under the Securities Act and no
stop order preventing or suspending the effectiveness of the
Registration Statement or suspending or preventing the use of any
Preliminary Prospectus, the Prospectus or any “free writing
prospectus”, as defined in Rule 405 under the Rules, has
been issued by the Commission and, to the knowledge of the Company,
no proceedings for that purpose have been instituted or are
threatened under the Securities Act. Any required filing of any
Preliminary Prospectus and/or the Prospectus and any supplement
thereto pursuant to Rule 424(b) of the Rules has been or will be
made in the manner and within the time period required by such
Rule 424(b). Any material required to be filed by the Company
pursuant to Rule 433(d) or Rule 163(b)(2) of the Rules has
been or will be made in the manner and within the time period
required by such Rules.
(d) The documents
incorporated by reference in the Registration Statement, any
Preliminary Prospectus and the Prospectus, at the time they became
effective or were filed with the Commission, as the case may be,
complied in all material respects with the requirements of the
Securities Act and the Rules or the Exchange Act and the rules and
regulations of the Commission thereunder, as applicable, and none
of such documents contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading,
and any further documents so filed and incorporated by reference in
the Registration Statement, any Preliminary Prospectus and the
Prospectus, when such documents become effective or are filed with
the Commission, as the case may be, will conform in all material
respects to the requirements of the Securities Act and the Rules or
the Exchange Act and the rules and regulations of the Commission
thereunder, as applicable, and will not contain an untrue statement
of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the
light of the circumstances under which they are made, not
misleading.
(e) Each Issuer
Free Writing Prospectus, if any, as of its issue date and at all
subsequent times through the completion of the public offer and
sale of the Shares or until any earlier date that the Company
notified or notifies the Underwriter as described in the next
sentence, did not, does not and will not include any information
that conflicted, conflicts or will conflict with the information
contained in the Registration Statement, including any document
incorporated by reference therein and any prospectus supplement
deemed to be a part thereof that has not been superseded or
modified, the Statutory Prospectus or the Prospectus. If at any
time following issuance of an Issuer Free Writing Prospectus
through the
5
completion of
the public offer and sale of the Shares there occurred or occurs an
event or development as a result of which such Issuer Free Writing
Prospectus conflicted or would conflict with the information then
contained in the Registration Statement, the Statutory Prospectus
or the Prospectus or included or would include an untrue statement
of a material fact or omitted or would omit to state a material
fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances
prevailing at the subsequent time, not misleading, the Company has
promptly notified or will promptly notify the Underwriter and has
promptly amended or will promptly amend or supplement, at its own
expense, such Issuer Free Writing Prospectus to eliminate or
correct such conflict, untrue statement or omission.
(f) The financial
statements of the Company (including all notes and schedules
thereto) included in the Registration Statement, the Statutory
Prospectus and the Prospectus present fairly in all material
respects the financial position and the statement of operations,
shareholders’ equity and cash flows of the Company and its
consolidated subsidiaries for the periods specified; and such
financial statements and related schedules and notes thereto, and
the unaudited financial information filed with the Commission as
part of the Registration Statement, have been prepared in
conformity with generally accepted accounting principles
(“GAAP”), consistently applied throughout the periods
involved, except as may be otherwise specified therein or to the
extent unaudited financial statements exclude footnotes or may be
condensed or summary statements, and it being understood that the
unaudited financial statements are subject to normal year-end
adjustments. The summary consolidated financial information
included in the Statutory Prospectus and Prospectus present fairly
the information shown therein as at the respective dates and for
the respective periods specified and have been presented on a basis
consistent with the consolidated financial statements set forth in
the Prospectus and other financial information. The pro forma
financial statements and the related notes and schedules thereto
included in the Registration Statement, the Statutory Prospectus
and the Prospectus, at the time such pro forma financial statements
were filed by the Company with the Commission on a Current Report
on Form 8-K, presented fairly the information shown therein, were
prepared in accordance with the Securities Act, the Exchange Act,
the Rules and the rules and regulations of the Exchange Act with
respect to pro forma financial statements and were properly
compiled on the bases described therein and, at such time, the
assumptions used in the preparation of the pro forma financial
statements were reasonable and the adjustments used therein were
appropriate to give effect to the transactions and circumstances
referred to therein. Except as described in the Statutory
Prospectus and the Prospectus, there are no material off-balance
sheet arrangements (as defined in Item 303 of
Regulation S-K) that have or are reasonably likely to have a
Material Adverse Effect (as defined herein).
(g) Deloitte &
Touche LLP (the “Auditor”) whose reports are filed with
the Commission as a part of the Registration Statement, are and,
during the periods covered by their reports, were independent
public accountants as required by the Securities Act and the Rules
and the Public Company Accounting Oversight Board.
(h) The Company
and each of its subsidiaries that is a “significant
subsidiary” within the meaning of Rule 1-02(w) of
Regulation S-X (each, a “Subsidiary”), has been
duly organized and is validly existing and in good standing (or the
foreign equivalent thereof) under
6
the laws of
their respective jurisdictions of incorporation or organization.
All of the issued and outstanding shares of capital stock of, or
other ownership interests in, each of the Company’s
subsidiaries, including each entity, corporation, partnership,
joint venture, association or other business organization
controlled directly or indirectly by the Company, including each
Significant Subsidiary (each, a “subsidiary”) have been
duly and validly authorized and issued and are fully paid and
non-assessable and, other than as described in the Statutory
Prospectus and the Prospectus, are owned, directly or indirectly,
by the Company, free and clear of any lien, charge, mortgage,
pledge, security interest, claim, limitation on voting rights,
equity, trust or other encumbrance, preferential arrangement,
defect or restriction of any kind whatsoever. The Company and each
of its Subsidiaries is duly qualified to do business and is in good
standing as a foreign corporation in each jurisdiction in which the
nature of the business conducted by it or location of the assets or
properties owned, leased or licensed by it requires such
qualification, each such entity has all requisite power and
authority to carry on its business as is currently being conducted
as described in the Statutory Prospectus and the Prospectus, and to
own, lease and operate its properties except where the failure to
so qualify or to have such power or authority individually or in
the aggregate would not have a material adverse effect on the
assets, properties, condition, financial or otherwise, or in the
results of operations of the Company and its subsidiaries
considered as a whole (a “Material Adverse Effect”);
and to the Company’s knowledge, no proceeding has been
instituted in any such jurisdiction revoking, limiting or
curtailing, or seeking to revoke, limit or curtail, such power and
authority or qualification except for any such proceeding which, if
determined adversely to the Company, would not result in a Material
Adverse Effect.
(i) The
Registration Statement initially became effective within three
years of the date hereof.
(j) The Company
and each of its Subsidiaries has all necessary authorizations,
approvals, consents, orders, licenses, certificates and permits of
and from all governmental or regulatory bodies or entities
(collectively, the “Permits”), to own, lease and
license its assets and properties and conduct its business as is
currently being conducted, all of which are valid and in full force
and effect, except where the lack of such Permits, individually or
in the aggregate, would not have a Material Adverse Effect. The
Company and each of its Subsidiaries has fulfilled and performed in
all material respects all of its obligations with respect to such
Permits and has not received any written notice of proceedings
relating to the revocation or modification of any Permits, except
where such violation would not, or such proceedings, if determined
adversely to the Company or any of its Subsidiaries would not
individually or in the aggregate have a Material Adverse
Effect.
(k) (i) At
the earliest time after the filing of the Registration Statement
that the Company or another offering participant made a bona fide
offer (within the meaning of Rule 164(h)(2) of the Rules) of
the Shares and (ii) at the date hereof, the Company was not
and is not an “ineligible issuer,” as defined in
Rule 405 of the Rules, including (but not limited to) the
Company or any other subsidiary in the preceding three years not
having been convicted of a felony or misdemeanor or having been
made the subject of a judicial or administrative decree or order as
described in Rule 405 of the Rules.
7
(l) Except as
disclosed in the Statutory Prospectus and the Prospectus
(i) the Company and each of its Subsidiaries owns or has
adequate licenses or other rights to use all trademarks, trade
names, domain names, patents, patent rights, mask works,
copyrights, technology, know-how (including trade secrets and other
unpatented or unpatentable proprietary or confidential information,
systems or procedures), service marks, trade dress rights, and
other intellectual property (collectively, “Intellectual
Property”) sufficient in all material respects to conduct its
business as now conducted, (ii) to the Company’s
knowledge, the business of the Company and its Subsidiaries as
currently conducted does not infringe the Intellectual Property
rights of others, except as would not reasonably be expected to
have a Material Adverse Effect, (iii) there are no pending or,
to the Company’s knowledge, threatened actions, suits or
proceedings against the Company or any of its subsidiaries that
allege that the Company or any of its subsidiaries is infringing
any third-party Intellectual Property rights, which actions, suits
or proceedings could reasonably be expected to have a Material
Adverse Effect, and (iv) in the three-year period prior to the
date hereof, the Company and its Subsidiaries have not received any
written notice from any third party claiming that the Company or
any of its subsidiaries is infringing any third-party patent or
challenging the validity, scope or enforceability of any
Intellectual Property owned by or licensed to the Company or any of
its Subsidiaries, which could reasonably be expected to have a
Material Adverse Effect.
(m) Except as
disclosed in the Statutory Prospectus and the Prospectus, the
Company and each of its subsidiaries has good and marketable title
in fee simple or have valid and enforceable rights to lease or
otherwise use all real property, and good and marketable title to
all personal property owned by it that are material to the business
of the Company and its Subsidiaries taken as a whole, in each case
free and clear of all liens, encumbrances, claims, security
interests and defects, except such as would not result in a
Material Adverse Effect. Since the date of the latest balance sheet
of the Company included in the Registration Statement, Statutory
Prospectus and Prospectus, (i) there has not been any event
which would reasonably be expected to have a Material Adverse
Effect; (ii) neither the Company nor its Subsidiaries has
(A) issued any securities (other than the issuance of
securities pursuant to the Company’s existing equity
incentive plans or bonus plans or the issuance of Common Stock
pursuant to the exercise of stock options or other equity awards
granted under the Company’s equity incentive plans) or
incurred any indebtedness, except such indebtedness incurred in the
ordinary course of business (B) except as disclosed in the
Registration Statement, Statutory Prospectus and Prospectus,
entered into any material transaction not in the ordinary course of
business or (C) declared or paid any dividend or made any
distribution on any shares of its capital stock or redeemed,
purchased or otherwise acquired or agreed to redeem, purchase or
otherwise acquire any shares of its capital stock.
(n) There is no
document, contract or other agreement required to be described in
the Registration Statement, the Statutory Prospectus or the
Prospectus or to be filed as an exhibit to the Registration
Statement which is not described or filed as required by the
Securities Act or Rules. Each description of a contract, document
or other agreement in the Registration Statement, the Statutory
Prospectus or the Prospectus accurately reflects in all material
respects the terms of the underlying contract, document or other
agreement. Each contract, document or other agreement described in
the Registration Statement, the Statutory Prospectus or the
Prospectus or listed in the Exhibits to the Registration Statement
or
8
incorporated by
reference is in full force and effect and is valid and enforceable
by and against the Company or its subsidiary, as the case may be,
in accordance with its terms, except as the enforceability thereof
may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable
principles. Neither the Company nor any of its subsidiaries, if a
subsidiary is a party, is in default in the observance or
performance of any term or obligation to be performed by it under
any such agreement, and no event has occurred which with notice or
lapse of time or both would constitute such a default, in any such
case which default or event, individually or in the aggregate,
would have a Material Adverse Effect.
(o) The
statistical and market related data included in the Registration
Statement, the Statutory Prospectus or the Prospectus are based on
or derived from sources that the Company believes to be reliable
and accurate.
(p) Neither the
Company nor any Subsidiary is in (i) violation of its
certificate or articles of incorporation or organization, by-laws,
certificate of formation, limited liability company agreement,
partnership agreement or other organizational documents,
(ii) default under, and no event has occurred which, with
notice or lapse of time, or both, would constitute a default under,
or result in the creation or imposition of any lien, charge,
mortgage, pledge, security interest, claim, limitation on voting
rights, equity, trust or other encumbrance, preferential
arrangement, defect or restriction of any kind whatsoever, upon,
any property or assets of the Company or any Subsidiary pursuant
to, any bond, debenture, note, indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which it is a
party or by which it is bound or to which any of its properties or
assets is subject or (iii) violation of any statute, law,
rule, regulation, ordinance, directive, judgment, decree or order
of any judicial, regulatory or other legal or governmental agency
or body, foreign or domestic, except (in the case of clauses
(ii) and (iii) above) for violations or defaults that
would not (individually or in the aggregate) be reasonably expected
to have a Material Adverse Effect.
(q) This Agreement
has been duly authorized, executed and delivered by the
Company.
(r) Neither the
execution, delivery and performance of this Agreement by the
Company nor the consummation of any of the transactions
contemplated hereby (including, without limitation, the issuance
and sale by the Company of the Shares) will give rise to a right to
terminate or accelerate the due date of any payment due under,
require the repurchase, redemption or repayment of all or any
portion of, conflict with or result in the breach of any term or
provision of, or constitute a default (or an event which with
notice or lapse of time or both would constitute a default) under,
or require any consent or waiver under, or result in the execution
or imposition of any lien, charge or encumbrance upon any
properties or assets of the Company or its subsidiaries pursuant to
the terms of, any indenture, mortgage, deed of trust or other
agreement or instrument to which the Company or any of its
subsidiaries is a party or by which either the Company or its
subsidiaries or any of their properties or businesses is bound, or
any franchise, license, permit, judgment, decree, order, statute,
rule or regulation applicable to the Company or any of its
subsidiaries or violate any provision of the charter or by-laws of
the Company or any of its subsidiaries, except for such consents or
waivers which have already been obtained and are in full force and
effect and except for any breach, violation,
9
default, lien,
charge or encumbrance that would not, individually or in the
aggregate, result in a Material Adverse Effect.
(s) The Company
has authorized and outstanding capital stock as of July 3,
2009 as set forth under the caption “Capitalization” in
the Statutory Prospectus and the Prospectus. All of the issued and
outstanding shares of Common Stock have been duly and validly
issued and are fully paid and nonassessable. There are no statutory
preemptive or other similar rights to subscribe for or to purchase
or acquire any shares of Common Stock of the Company or any of its
Subsidiaries or any such rights pursuant to its certificate or
articles of incorporation or organization or by-laws or any
agreement or instrument to or by which the Company or any of its
Subsidiaries is a party or bound. The Shares, when issued and sold
pursuant to this Agreement, will be duly and validly issued, fully
paid and nonassessable and none of them will be issued in violation
of any preemptive or other similar right. Except as disclosed in
the Registration Statement, the Statutory Prospectus and the
Prospectus, there is no outstanding option, warrant or other right
calling for the issuance of, and there is no commitment, plan or
arrangement to issue, any share of stock of the Company or any of
its subsidiaries or any security convertible into, or exercisable
or exchangeable for, such stock. The Common Stock and the Shares
conform in all material respects to all statements in relation
thereto contained in the Registration Statement, the Statutory
Prospectus and the Prospectus.
(t) No holder of
any security of the Company has any right, which has not been
waived, to have any security owned by such holder included in the
Registration Statement or to demand registration of any security
owned by such holder for a period of 90 days after the date of
this Agreement.
(u) Except as set
forth in the General Disclosure Package, there are no legal or
governmental actions, suits, claims or proceedings pending to which
the Company or any of its subsidiaries is a party or of which any
property or assets of the Company or any of its subsidiaries is the
subject which, if determined adversely to the Company or any of its
subsidiaries could reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect; and, to the knowledge
of the Company, no such proceedings are threatened or contemplated
by governmental authorities or threatened by others.
(v) All necessary
corporate action has been duly and validly taken by the Company to
authorize the execution, delivery and performance of this Agreement
and the issuance and sale of the Shares by the Company.
(w) Neither the
Company nor any of its Subsidiaries is involved in any labor
dispute with its employees nor, to the knowledge of the Company, is
any such dispute threatened, which dispute would have a Material
Adverse Effect.
(x) No transaction
has occurred between or among the Company and any of its executive
officers, directors, or other affiliates that is required by
Item 404 of Regulation S-K to be described in, and is not
described, in the Registration Statement, the Statutory Prospectus
and the Prospectus.
10
(y) The Company
has not taken, nor will it take, directly or indirectly, any action
designed to or which might reasonably be expected to cause or
result in, or which has constituted or which might reasonably be
expected to constitute, the stabilization or manipulation of the
price of the Common Stock or any security of the Company to
facilitate the sale or resale of any of the Shares.
(z) The Company
and each of its subsidiaries has filed all Federal, state, local
and foreign tax returns which are required to be filed through the
date hereof or has requested extensions thereof (except in any case
in which the failure to so file would not have a Material Adverse
Effect), and, except as set forth in the Statutory Prospectus and
Prospectus, has paid all taxes and all assessments required to be
paid by them, except for any such taxes or assessments currently
being contested in good faith and as would not, individually or in
the aggregate, have a Material Adverse Effect. All returns filed by
the Company and each of its subsidiaries were true and correct in
all material respects at the time of filing. There are no tax
audits or investigations pending against the Company, which if
adversely determined against the Company would have a Material
Adverse Effect.
(aa) The Shares
have been duly authorized for listing on the NASDAQ Global Select
Market.
(bb) The Company
has taken no action designed to, or likely to have the effect of,
terminating the registration of the Common Stock under the Exchange
Act or the listing of the Common Stock on the NASDAQ Global Select
Market, nor has the Company received any written notification that
the Commission or the NASDAQ Global Select Market is contemplating
terminating such registration or quotation.
(cc) The Company
and its subsidiaries, on a consolidated basis, maintains a system
of internal accounting controls that are designed to provide
reasonable assurances that (i) transactions are executed in
accordance with management’s general or specific
authorizations, (ii) transactions are recorded as necessary to
permit preparation of financial statements in accordance with GAAP
and to maintain accountability for assets, (iii) access to
assets is permitted only in accordance with management’s
general or specific authorization and (iv) the recorded
accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect
to any differences.
(dd) The Company
has established and maintains disclosure controls and procedures
(as such term is defined in Rule 13a-15 under the Exchange
Act), which: (i) are designed to ensure that material
information relating to the Company is made known to the
Company’s principal executive officer and its principal
financial officer by others within the Company as appropriate to
allow timely decisions regarding timely disclosure;
(ii) provide for the periodic evaluation of the effectiveness
of such disclosure controls and procedures at the end of the
periods in which the periodic reports are required to be prepared;
and (iii) are effective in all material respects to perform
the functions for which they were established.
(ee) Since the
date of the Company’s last quarterly report on Form 10-Q, the
Company is not aware of (i) any material weaknesses in
internal controls; or (ii) any fraud,
11
whether or not
material, that involves management or other employees who have a
role in the Company’s internal controls.
(ff) The Company
is in compliance in all material respects with all applicable
continued listing and corporate governance rules of The NASDAQ
Stock Market LLC.
(gg) The Company
and, to the Company’s knowledge, its directors and officers,
in their capacities as such, are in compliance in all material
respects with all applicable provisions of the Sarbanes-Oxley Act,
including, without limitation, Section 402 related to loans
and Sections 302 and 906 related to certifications.
(hh) The Company
and its Subsidiaries are insured against such losses and risks and
in such amounts as the Company reasonably deems adequate; all
policies of insurance and fidelity or surety bonds insuring the
Company or any of its Subsidiaries or the Company’s or its
Subsidiaries’ respective businesses, assets, employees,
officers and directors are in full force and effect; and the
Company and each of its Subsidiaries is in compliance with the
terms of such policies and instruments in all material
respects.
(ii) Each
approval, consent, order, authorization, designation, declaration
or filing of, by or with any regulatory, administrative or other
governmental body necessary in connection with the execution and
delivery by the Company of this Agreement and the consummation of
the transactions herein contemplated required to be obtained or
performed by the Company (except such additional steps as may be
required by the Financial Industry Regulatory Authority
(“FINRA”) or may be necessary to qualify the Shares for
public offering by the Underwriter under the state securities or
Blue Sky laws) has been obtained or made and is in full force and
effect.
(jj) There are no
affiliations with FINRA among the Company’s officers,
directors or, to the best of the knowledge of the Company, any five
percent or greater stockholder of the Company, except as set forth
in the Registration Statement or otherwise disclosed in writing to
the Underwriter.
(kk) Except as
disclosed in the Registration Statement, the Statutory Prospectus
and the Prospectus or except as would not, individually or in the
aggregate, have a Material Adverse Effect, (i) each of the
Company and each of its Subsidiaries is in compliance in all
material respects with all rules, laws and regulation relating to
the use, treatment, storage and disposal of toxic substances and
protection of health or the environment which are applicable to its
business (“Environmental Law”); (ii) neither the
Company nor its subsidiaries has received any written notice from
any governmental authority or third party of an asserted claim
under Environmental Laws; and (iii) to the Company’s
knowledge, no facts currently exist that will subject the Company
or any of its Subsidiaries to liability for toxic substance
remediation under Environmental Laws.
(ll) The Company
is not, and after giving effect to the offering and sale of the
Shares and the application of proceeds thereof as described in the
Statutory Prospectus and the Prospectus, will not be an
“investment com
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