Underwriting Agreement: Meaning and Types

“Securities Laws” means, collectively, the Sarbanes-Oxley Act of 2002, as amended (“Sarbanes-Oxley”), the Act, the Exchange Act, the Rules and Regulations, the auditing principles, rules, standards and practices applicable to auditors of “issuers” (as defined in Sarbanes-Oxley) promulgated or approved by the Public Company Accounting Oversight Board and, as applicable, the rules of the New York Stock Exchange (“Exchange Rules”). The “Agreements to Sell and Purchase” section states that the company agrees to sell to the underwriters, and that the underwriters will purchase securities from the company at the price specified in this section. This Agreement supersedes all prior agreements and understandings (whether written or oral) between the Company and the Underwriters, or
any of them, with respect to the subject matter hereof. (nn) From the time of initial confidential
submission of a registration statement relating to the Shares with the Commission (or, if earlier, the first date on which a Section 5(d) Communication was made) through the date hereof, the Company has been and is an “emerging growth
company” as defined in Section 2(a)(19) of the Act (an “Emerging Growth Company”). A best-efforts underwriting agreement is mainly used in the sales of high-risk securities.

• The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission.
• I choose the person who provided the most detailed and relevant intro letter, highlighting their experience relevant to my project.
• The Company waives, to the fullest extent permitted by law, any claims it may have against the Representatives for breach of fiduciary duty or alleged breach of fiduciary duty and agrees that the Representatives shall have no liability (whether direct or indirect) to the Company in respect of such a fiduciary duty claim or to any person asserting a fiduciary duty claim on behalf of or in right of the Company, including stockholders, employees or creditors of the Company.
• The Underwriting Agreement has been duly authorized, executed and delivered by the Company.

The value of shares and ETFs bought through a share dealing account can fall as well as rise, which could mean getting back less than you originally put in. Past performance is no guarantee of future results. Julia Kagan is a financial/consumer journalist and former senior editor, personal finance, of Investopedia. The Underwriting Agreement has been duly authorized, executed and delivered by the Company.

Underwriting Agreement Sample

Born and raised in the heart of the Appalachian coalfields, Oliver understands the value of hard work and perseverance. His small-town upbringing instilled in him a deep sense of community and a commitment to making a difference in people’s lives. Oliver’s journey in the legal field began with a Bachelor’s degree in Criminal Justice from Bluefield University. He went on to earn his Juris Doctorate from Lincoln Memorial University – Duncan School of Law, where he excelled in his studies and developed a strong foundation in law. Throughout his career, Oliver has gained invaluable experience working as a public defender, an attorney advisor for the Small Business Administration, and in various legal roles. With a focus on estate planning and business law, Oliver is dedicated to helping individuals and families protect their assets, plan for the future, and navigate the complexities of the legal system.

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 and to the extent not previously exercised may be surrendered and terminated at any time upon notice by the Representatives to the Company. The Company hereby grants to the Underwriters the right to purchase at their election up to [•] Optional Shares, at the purchase price
per share set forth in the paragraph above, for the sole purpose of covering sales of shares in excess of the number of Firm Shares, provided that the purchase price per Optional Share shall be reduced by an amount per share equal to any dividends
or distributions declared by the Company and payable on the Firm Shares but not payable on the Optional Shares. Any such election to purchase Optional Shares may be exercised only by written notice from the Representatives to the Company, given
within a period of 30 calendar days after the date of this Agreement, setting forth the aggregate number of Optional Shares to be purchased and the date on which such Optional Shares are to be delivered, as determined by the Representatives but in
no event earlier than the First Time of Delivery (as defined in Section 4 hereof) or, unless the Representatives and the Company otherwise agree in writing, earlier than two or later than ten business days after the date of such notice. Each of the Registration Statement, at the time it was declared effective, the General Disclosure Package, as of the Applicable Time, and the Final Prospectus, when filed with the Commission pursuant to Rule 424(b) under the Securities Act and at the Closing Date (in each case other than (a) the financial statements and related schedules, including the notes and schedules thereto and the auditor’s report thereon, (b) the other financial data derived therefrom and (c) oil and natural gas reserve data or reports, in each case included in or omitted from the Registration Statement, or contained in or omitted from the General Disclosure Package and the Prospectus, as to which we express no opinion), appeared on their face to comply as to form in all material respects with the requirements of the Securities Act. (u) Absence of Existing Defaults and Conflicts.

Criminal Law

For purposes of this Lock-Up Agreement, a “family member” shall mean any relationship by blood, marriage, domestic partnership or adoption, not more remote than first cousin. This press release is not an offer for sale of the securities in the United States or in any other jurisdiction where such offer is prohibited, and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the United States Securities Act of 1933, as amended. The Company has all requisite corporate power and authority to execute, deliver and perform its obligations under the Underwriting Agreement and to issue and sell the Offered Securities.

The underwriting agreement is also called an underwriting contract. The Representatives will act for the several Underwriters in connection with the transactions contemplated by this Agreement, and any action under this Agreement taken by the Representatives jointly will be binding upon all the Underwriters. The Company will arrange for the qualification of the Offered Securities for sale under the laws of such jurisdictions as the Representatives designate and will continue such qualifications in effect so long as required for the distribution. (mm) Statistical and Market-Related Data.

Form underwriting agreements may also include forward-looking language that defines a MAC or MAE as a material change in the issuer’s prospects, granting the underwriters additional flexibility if a breach occurs that may not be material at present but could potentially lead to material adverse effects in the future. The issuer may insist on narrowing the definitions of MAC and MAE so as to not give the underwriters the freedom to walk away from the transaction, and they may seek to minimize or remove any language that provides the underwriters full discretion to determine on their own whether a particular event has risen to the level of a MAC or MAE. The issuer also may seek to strike any forward-looking language to prevent the underwriters from exiting a transaction upon the occurrence of a nonmaterial breach.

Meet some of our Underwriting Agreement Lawyers

The Company has been duly incorporated and is existing and in good standing under the laws of the State of Delaware, with power and authority to own or lease its properties and conduct its business as described in the General Disclosure Package and the Final Prospectus; and the Company is duly qualified to do business as a foreign corporation in good standing in all other jurisdictions listed on Schedule D hereto 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 or in good standing would not, individually or in the aggregate, reasonably be expected to result in a material adverse effect on the condition (financial or otherwise), results of operations, business, properties or prospects of the Company and its Subsidiaries taken as a whole (a “Material Adverse Effect”). After giving effect to the Reorganization Transactions, the Company will not own or control, directly or indirectly, any corporation, association or other entity other than the subsidiaries listed on Schedule C hereto (“Subsidiaries”). The “Conditions to the Underwriters’ Obligations” section states in detail the conditions and obligations of the underwriters. These requirements include the delivery of certain other documents. One such document is a negative assurance letter. A negative assurance letter is a confirmation from the company’s auditor that certain facts are accurate.

This press release is not an offer for sale of the securities in the United States or in any other jurisdiction where
such offer is prohibited, and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the United States Securities Act of 1933, as amended. If the foregoing is in accordance with your understanding, please sign and return to us one for the Company and each of the Representatives
plus one for each counsel counterparts hereof, and upon the acceptance hereof by you, on behalf of each of the Underwriters, this letter and such acceptance hereof shall constitute a binding agreement between each of the Underwriters and the
Company. It is understood that your acceptance of this letter on behalf of each of the Underwriters underwriting is a contract of is pursuant to the authority set forth in a form of Agreement among Underwriters, the form of which shall be submitted to the Company for examination
upon request, but without warranty on your part as to the authority of the signers thereof. This Agreement shall be binding upon, and inure solely to the benefit of, the Underwriters,
the Company and, to the extent provided in Sections 9 and 11 hereof, the officers and directors of the Company and each person who controls the Company or any Underwriter, and their respective heirs, executors, administrators, successors and
assigns, and no other person shall acquire or have any right under or by virtue of this Agreement. No purchaser of any of the Shares from any Underwriter shall be deemed a successor or assign by reason merely of such purchase.

Negotiating an Underwriting Agreement

This agreement shall be executed in duplicate. The original shall be retained by the company and the duplicate by the underwriters. It is hereby agreed that time is the essence of this agreement. The foregoing Underwriting Agreement is hereby confirmed and accepted as of the date first above written.

The relative benefits received by the Company 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 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 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 (d) 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 (d). Notwithstanding the provisions of this subsection (d), 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 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.

In particular, the “Representations and Warranties of Company” and “Covenants of Company” sections are often highly negotiated in each deal. Successful entrepreneur and business attorney with keen insight into the challenges faced by small and medium-sized businesses. In addition to my solo practice, I have extensive experience as general counsel for highly regulated businesses where I have negotiated and drafted a wide array of contracts, conducted internal regulatory compliance, engaged in transactional work and assisted with general commercial litigation.

These include, but are not limited to, carve-outs for already planned issuances or transfers of securities, ordinary course lending or capital markets activities, and issuances for employees under existing agreements or to attract or retain key talent. To assume the defense thereof, the indemnifying party will not be liable to such indemnified party under this Section 8 for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation. Notwithstanding anything contained herein to the contrary, if indemnity may be sought pursuant to the last paragraph in Section 8(a) hereof in respect of such action or proceeding, then in addition to such separate firm for the indemnified parties, the indemnifying party shall be liable for the reasonable fees and expenses of not more than one separate firm (in addition to any local counsel) for the Designated Underwriter for the defense of any losses, claims, damages and liabilities arising out of the Directed Share Program, and all persons, if any, who control the Designated Underwriter within the meaning of either Section 15 of the Act of Section 20 of the Exchange Act.

Civil Law / Property

The undersigned now has, and, except as contemplated by (a) above, for the duration of this
Lock-Up Agreement will have, good and marketable title to the Undersigned’s Shares, free and clear of all liens, encumbrances, and claims whatsoever. For purposes of this subsection, “Hazardous Substance” means (y) any pollutant, contaminant, petroleum and petroleum products, by-products or breakdown products, radioactive materials, asbestos, asbestos-containing materials, polychlorinated biphenyls or toxic mold, and (z) any other toxic, radioactive, ignitable, corrosive, reactive or otherwise hazardous chemical, material, waste or substance. (l) Historical Financial Statements. The historical financial statements (including the related notes) included in each Registration Statement, the General Disclosure Package and the Final Prospectus present fairly in all material respects the financial condition, results of operations and cash flows of the entities purported to be shown thereby, at the dates and for the periods indicated, and, except as otherwise disclosed in the General Disclosure Package and the Final Prospectus, have been prepared in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) applied on a consistent basis. The unaudited pro forma financial statements and the related notes thereto included under the heading “Pro Forma Financial Statements” in the Registration Statement present fairly in all material respects the information contained therein and have been properly presented on the basis described therein, and the assumptions used in the preparation thereof are reasonable and the adjustment used therein are appropriate to give effect to the transactions and circumstances referred to therein.

• In addition, the undersigned hereby agrees that it will not make any demand for exercise of any right with respect to the registration of any shares of Common Stock or any
  security convertible into or exercisable or exchangeable for Common Stock during the Lock-Up Period.
• Broadly speaking, there are two types of underwriting arrangements—firm commitment underwriting and best efforts underwriting.
• (e)(2) If the Representatives, in their sole discretion, agree to release or waive the restrictions set forth in a lock-up letter delivered pursuant to Section 8(h) hereof for an officer or director of the Company and provide the Company with notice of the impending release or waiver at least three business days
  before the effective date of the release or waiver, the Company agrees to announce the impending release or waiver by a press release substantially in the form of Annex I hereto through a major news service at least two business days before the
  effective date of the release or waiver.

The issuer is expected to pay for or reimburse the underwriters for any offering-related expenses. The issuer is also expected to reimburse the underwriters for counsel expenses relating to the Financial Industry Regulatory Authority (FINRA) review. The issuer typically includes a limitation on the amount reimbursable for underwriter counsel fees in connection with the FINRA review. The underwriting agreement may also include a provision requiring the underwriters to reimburse the issuer for certain offering expenses if the underwriters breach the underwriting agreement. For example, an issuer may request reimbursement if the underwriters fail to market the securities in a manner consistent with the underwriting agreement. Notwithstanding the limited reimbursement obligation, the underwriters are expected to pay for their own counsel.

Examples of Underwriting Contract in a sentence

The provisions of this
paragraph will not apply if (a) the release or waiver is effected solely to permit a transfer not for consideration and (b) the transferee has agreed in writing to be bound by the same terms described in this letter to the extent and for
the duration that such terms remain in effect at the time of the transfer. An underwriting agreement is a contract between a corporation issuing new securities to be offered to the public and a group of investment bankers who form an underwriting group or syndicate. The underwriting agreement establishes the responsibilities of all parties to the proposed sale, including any commitment of the underwriters to purchase the securities, the public offering price, the underwriting spread (including all discounts and commissions), the net proceeds to the issuer, and the settlement date. Substance reasonably satisfactory to the Representatives, in the form of the “comfort letters” delivered on the date hereof, except that (i) it shall state the conclusions and findings of KPMG with respect to the financial information included or incorporated by reference in the Registration Statement and the Final Prospectus and any amendment or supplement thereto and other customary matters ordinarily covered by accountants’ “comfort letters” to underwriters in connection with registered public offerings and (ii) procedures shall be brought down to a date no more than three (3) business days prior to such Closing Date, except as otherwise agreed by the Representatives.

In the underwriting agreement, the issuer is often expected to make representations relating to its compliance with the Foreign Corrupt Practices Act of 1977 (FCPA), the sanctions administered by the Office of Foreign Assets Control (OFAC) of the U.S. Department of the Treasury, and anti-money laundering (AML) laws. Underwriters have typically placed increased importance on these compliance representations because of recent increases in enforcement activity by federal authorities and severe civil and criminal penalties that result from violations. The underwriters therefore should focus on maintaining the standard FCPA, OFAC, and AML representations in the form underwriting agreement designated by the lead investment bank.

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