Attached files
| file | filename |
|---|---|
| 8-K - Shengkai Innovations, Inc. | v203351_8k.htm |
| EX-99.1 - Shengkai Innovations, Inc. | v203351_ex99-1.htm |
| EX-10.1 - Shengkai Innovations, Inc. | v203351_ex10-1.htm |
November
18, 2010
Global Hunter Securities,
LLC
777 3rd
Ave, 36th Floor
New York,
New York 10017
Maxim
Group LLC
405
Lexington Ave
New York,
NY 10174
Re:
Shengkai Innovations, Inc.
Ladies
and Gentlemen:
We have acted as counsel to Shengkai
Innovations, Inc., a Florida corporation (the "Company") in connection with the
issuance and sale by the Company of up to 2,456,800 shares (the "Shares")
of the Company's common stock, par value $.001 per share ("Common Stock"),
pursuant to that certain Underwriting Agreement, dated November 19, 2010 (the
"Underwriting Agreement"), by and between the Company and you, the
representative of the underwriters named therein (the "Underwriters"). This
opinion is being rendered to you pursuant to Section 7(c) of the Underwriting
Agreement. Capitalized terms used but not defined herein shall have the meanings
ascribed to such terms in the Underwriting Agreement.
In our capacity as counsel to the
Company, we have examined, among other things, originals, or copies identified
to our satisfaction as being true copies, of the following:
(i) The
Registration Statement on Form S-3/A (File No. 333-167276) filed by the Company
with the Securities and Exchange Commission (the "Commission")
on October 21, 2010, for the purposes of registering the sale of the
Shares under the Securities Act of 1933 (the "Securities Act"), as amended
including the Prospectus dated October 21, 2010 contained therein (the “Base
Prospectus”) as amended, which incorporates by reference, or is deemed to
incorporate by reference, the Incorporated Documents referred to below; as
supplemented by the Preliminary Prospectus Supplement dated November 18, 2010
(collectively, as so supplemented, the “Preliminary Prospectus”) and Prospectus
Supplement dated November 19, 2010 , relating to the offer and sale of the
Shares (as so supplemented, the “Final Prospectus”) filed by the Company with
the Commission pursuant to Rule 424 (b)(File No. 333-167276) under the
Securities Act, which also incorporates by reference, or is deemed to
incorporate by reference, the Incorporated Documents, the Notice of
Effectiveness notifying that the Commission had declared such Registration
Statement, effective as of 11:00 a.m., Washington D.C. time, on October 25,
2010. Such
Registration Statement, when it became effective (including the information
deemed to be part of the Registration Statement at the time it became effective
pursuant to Rule 430 A of the Rules and Regulations under the Securities Act),
is referred to herein as the "Registration Statement," and such Base Prospectus, Preliminary Prospectus and Final
Prospectus in the form delivered
for filing with the Commission pursuant to Rule 424(b) sometimes collectively referred to herein as
the “Prospectus”;
November 18, 2010
Page 2
(ii) The Company’s Annual Report on Form 10-K for the fiscal year
ended June 30, 2010 (the “Annual Report”) filed on September 28, 2010, the
Company’s Current Report on Form 8-K dated
September 30, 2010; the amended Company’s Quarterly Reports on Form 10-Qs for
the quarters ended March 31, 2010 and December 31, 2009 both
filed on October 13, 2010; the Company’s Quarterly Report on
Form 10-Q/A for the quarter ended September 30, 2009 filed with the SEC on
August 19, 2010; the Company’s Quarterly Report on Form 10-Q/A for the quarter
ended December 31, 2009 filed with the SEC on August 19, 2010; the Company’s
Quarterly Report on Form 10-Q/A for the quarter ended March 31, 2010 filed with
the SEC on August 19, 2010; the Company’s Current Report on Form 8-K filed with
the SEC on August 9, 2010; the Company’s Current Report on Form 8-K filed with
the SEC on August 26, 2010; the Company’s Current Report on Form 8-K filed with
the SEC on September 7, 2010; the Company’s Current Report on Form 8-K filed
with the SEC on September 17, 2010 and the Company’s Current Report on Form 8-K
filed with the SEC on September 30, 2010(collectively, the “Incorporated
Documents”), in each case filed by the Company with the Commission under the
Securities Exchange Act of 1934 (the “Exchange Act”);
(iii) The
Articles of Incorporation of the Company as amended and in effect on the date
hereof (the "Articles of Incorporation");
(iv) The
Bylaws of the Company as amended and in effect on the date hereof (the
"Bylaws");
(v) The Certificate of Good Standing of
the Company certified by
the Secretary of State of the State of Florida on November 17, 2010 (the "Florida
Certificate");
(vi) The
resolutions of the Board of Directors of the Company adopted on November 18,
2010, authorizing/ratifying the execution and delivery of the Underwriting
Agreement, the issuance and sale of the Shares sold by the Company, the
preparation and filing of the Registration Statement, and other actions with
regard thereto;
(vii) The
resolutions of the Board of Directors of the Company adopted on November 18,
2010, authorizing the pricing of the Shares;
(viii)
The Underwriting Agreement;
(ix) A
specimen certificate for the shares of Common Stock of the Company;
(x) The
letter of Albert Wong & Co., dated November 18, 2010, relating to the
consolidated financial statements included in the Registration Statement and
other matters referred to therein, delivered pursuant to Section 7(f) of the
Underwriting Agreement;
(xi) The
letter of BDO China Li Xin Da Hua CPA Co., Ltd., dated November 18, 2010,
relating to the consolidated financial statements included in the Registration
Statement and other matters referred to therein;
(xii) The
opinion letter, dated November 18, 2010, of Deheng Law Firm, special
counsel for the Company in the People's Republic of China ("PRC"), delivered
pursuant to Section 7(c) of the Underwriting Agreement;
November 18, 2010
Page 3
(xv) Such
other records, certificates, documents and instruments, certified or otherwise
identified to our satisfaction, as we have considered necessary or appropriate
for the purposes of this opinion.
In
addition, we have obtained from public officials and from officers and other
representatives of the Company such other certificates and assurances as we
consider necessary for purposes of this opinion. We have assumed the accuracy of
all copies provided to us, the legal capacity of the individual signatories to
all documents and the due authorization execution and delivery of the
Underwriting Agreement by the Underwriters. We have also assumed the genuineness
of all signatures.
As used
in this opinion, the expressions "to our knowledge" and "known to us" with
reference to matters of fact means the actual knowledge of those attorneys in
our firm who have given substantive attention to the Company's affairs. Beyond
that, we have made no independent factual investigation for the purpose of
rending an opinion with respect to such matters except as otherwise specified in
this opinion.
We have
assumed that the certificates representing the Common Stock purchased by the
Underwriters from the Company have been executed for delivery by authorized
officers of the transfer agent and that the signatures on all documents examined
by us are genuine, which assumptions we have not independently
verified.
This
opinion relates solely to the laws of the State of New York, the State of
Florida, and the federal securities laws of the United States, and we express no
opinion with respect to effect or applicability of the laws in other areas or of
other jurisdictions. We invite your attention to the fact that the Underwriting
Agreement states that it is governed by the laws of the State of New York and
that the Company is incorporated under the laws of the State of Florida. Without
limiting the generality of the foregoing, we are not experts on, and we do not
express any opinion on any applicable laws, rules or regulations relating to (i)
patents, copyrights, trademarks and other proprietary rights and licenses, or
(ii) the People's Republic of China.
For
purposes of the matters addressed in paragraph (1) below relating to the valid
existence and good standing of the Company under the laws of Florida, we have
relied solely upon the Florida Certificate.
For
purposes of our opinion in paragraph (3) below, we have assumed that the
certificates representing the Shares will be manually signed by one of the
authorized officers of the transfer agent and registrar of the Common Stock and
registered by such transfer agent and registrar and will conform to the specimen
thereof examined by us.
For purposes of our opinion in paragraph
(6) below, relating to the Registration
Statement being effective and there being no stop order suspending the
effectiveness of the Registration Statement, we have relied solely upon (a) the
Notice of Effectiveness notifying that the Commission had declared such
Registration Statement, effective as of 11:00 a.m., Washington D.C. time, on October
21, 2010 and (b) oral advice received on November 18, 2010 from a Commission staff examiner
that there is no stop order suspending the effectiveness of the Registration
Statement.
November 18, 2010
Page 4
For
purposes of our opinion in paragraph (6) below, relating to the filing of the
Prospectus pursuant to Rule 424(b), we have relied solely upon a confirmation of
filing received from the Commission's EDGAR filing system dated November 18,
2010.
On the basis of our examination of the
foregoing, and subject to the qualifications and limitations set forth herein,
we are of the opinion that:
(1) the Company formed under the laws of the
State of Florida has been duly organized and is validly existing as
a corporation and is in good standing under the laws of the State of Florida
with the requisite corporate power to own or lease, as the case may be, and
operate its respective properties, and to conduct its business, as described in the Registration
Statement and the Prospectus. To our knowledge, the Company has no subsidiaries formed
under the laws of any jurisdiction within the United States and is not
registered or qualified to do business as a foreign corporation under the laws of any jurisdiction
within the United States.
(2) All issued and outstanding securities of
the Company have been duly authorized and validly issued and are fully paid and
non-assessable and none of such securities were issued in violation of the preemptive rights of any
stockholder of the Company arising by operation of law or under the Articles of Incorporation. To our knowledge, the offers and sales of the outstanding
securities were at all relevant times either registered under the
Securities Act of 1933, as
amended (the “Act”) or, based solely as to factual matters
on the representations and warranties of the Company and/or the purchasers set
forth in the applicable purchase agreements or certificates, exempt from such
registration requirements. The authorized, and to the
extent of the Company’s knowledge, outstanding Shares of the
Company is as set forth in the Prospectus.
(3) The Shares have been duly authorized
and, when issued and paid for, will be validly issued and to our
knowledge, fully paid and
non-assessable; the holders thereof are not and will not be subject to personal
liability solely by reason of being such holders. The Shares are not
and will not be subject to the preemptive rights of any holders of any security
of the Company arising by operating of law or
under the Articles
of
Incorporation.
(4) This Transaction Documents (as
defined in the Underwriting Agreement) have been duly and validly authorized
and executed by the Company and constitute the valid and binding obligations of the Company, enforceable
against the Company in accordance with their respective terms, except (a) as
such enforceability may be limited by bankruptcy, insolvency, reorganization or
similar laws affecting creditors’ rights generally, (b) as enforceability of any indemnification or
contribution provisions may be limited under the Federal and state securities
laws, and (c) that the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to the equitable defenses and to the discretion of the
court before which any proceeding therefore may be brought.
(5) The
execution, delivery, and performance of the Transaction Documents, and
consummation of the transactions contemplated by the Underwriting Agreement do
not and will not: (i) conflict with, require consent under or result in a breach
of any of the terms and provisions of, or constitute a default (or an event
which with notice or lapse of time, or both, would constitute a default) under,
or result in the creation or imposition of any Lien upon any property or assets
of the Company or any Subsidiary in the United States pursuant to, any
indenture, mortgage, deed of trust, loan agreement or other agreement,
instrument, franchise, license or permit to which the Company or any Subsidiary
is a party, and of which we have knowledge, or by which the Company or any
Subsidiary or their respective properties, operations or assets may be bound in
the United States or (ii) violate or conflict with any provision of the
certificate or articles of incorporation, by-laws, certificate of formation,
limited liability company agreement, partnership agreement or other
organizational documents of the Company or any Subsidiary in the United States,
or (iii) violate or conflict with any United States law, rule, regulation,
ordinance, directive, judgment, decree or order of any judicial, regulatory or
other legal or governmental agency or body, except in the case of subsections
(i) and (iii) for any default, conflict or violation that would not have or
reasonably be expected to have a Material Adverse Effect.
November 18, 2010
Page 5
(6) The Registration Statement and the
Prospectus and any post-effective amendments or supplements thereto (other than
the financial statements included therein, as to which no opinion need be rendered) each as of their
respective dates complied as to form in all material respects with the
requirements of the Securities Act and Rules and Regulations. The Shares offered
pursuant to the Prospectus conform in all material respects to the description thereof contained in the
Registration Statement and the Prospectus. No United States or New York statute
or regulation required to be described in the Prospectus is not described as
required (except as to the Blue Sky laws of the various states, as to which such counsel expresses
no opinions), nor, to our
knowledge, are any
contracts or documents of a character required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement not
so described or filed as required.
(7) The Registration Statement has been
declared effective by the Commission. We have been orally advised by
the Staff of the Commission that no stop order suspending the effectiveness of
the Registration Statement has been issued, and to our knowledge, no
proceedings for that purpose have been instituted or overtly threatened by the
Commission. Any required filing of the Prospectus, and any required
supplement thereto, pursuant to Rule 424(b) under the Securities Act, has been made in the manner and within
the time period required by Rule 424(b).
(8) The Company is not and, after giving
effect to the Offering and sale of the Securities and the application of the
proceeds thereof as described in the Registration Statement and the Prospectus, will not be, an
“investment
company” as defined in the
Investment Company Act of 1940, as amended.
(9) No consent, approval, authorization or
filing with or order of the NASDAQ, any U.S. Federal, State of New York or
governmental agency or body
having jurisdiction over the Company is required, under the laws, rules and
regulations of the United States of America and New York for the consummation by
the Company of the transactions contemplated by the Underwriting Agreement,
except (i) such as have been made with or
obtained from the NASDAQ (ii) such as have been made or obtained under the
Securities Act and (iii) such as may be required under the blue sky laws of any
jurisdiction in connection with the purchase and distribution of the Shares by you in the manner
contemplated in the Underwriting Agreement and in the Prospectus, as to which we
express no opinion.
(10) The Shares have been approved for
listing on the NASDAQ Market upon official notice of
issuance.
November 18, 2010
Page 6
(11) To our knowledge and except as otherwise disclosed in
the Registration Statement and Prospectus, the Company is not a party to any
written agreement granting any holders of securities of the Company rights to
require the registration under the Securities Act of resales of such securities.
In
rendering this opinion, we have assumed, without independent verification, and
with the understanding that we are under no duty to inquire about or perform any
investigation regarding such matters, the following: (a) the
genuineness of all signatures not witnessed (other than the signatures of the
executive officers of the Company), the authenticity of documents submitted to
us as originals, and the conformity to originals of all documents submitted to
us as certified or photostatic copies; (b) that such documents accurately and
completely describe and contain the mutual intent and understanding of the
parties as to all matters contained therein and that no other agreements or
undertakings exist between the parties that would affect the transactions
contemplated by such documents and agreements; (c) the due authorization,
execution, and delivery of the documents discussed herein by all parties thereto
except the Company and its subsidiary that such documents will be valid and
binding upon, and that such documents are enforceable in accordance with their
terms against, all parties thereto except the Company and its subsidiary, and
that the execution, delivery, and performance of such documents by parties other
than the Company and its subsidiary will not violate any provision of any
charter document, law, rule, regulation, judgment, order, decree, agreement or
other document binding upon or applicable to such other parties or their
respective assets; (d) the accuracy, completeness, and genuineness of all
representations and certifications made to or obtained by us, including those of
public officials; (e) the accuracy and completeness of records of the Company
and its subsidiary; and (f) that no fraud or dishonesty exists with respect to
any matters relevant to our opinions.
We
express no opinion regarding compliance by the Company or its subsidiaries with
any financial covenants required to be maintained by them under any agreement or
document.
We
express no opinion with respect to the validity and enforceability of
indemnification provisions to the extent they purport to provide indemnity
against violation by the indemnified party of any state or federal securities
laws or regulations, or against the gross negligence, willful misconduct, or
illegal acts of the indemnified party. Furthermore, we express no
opinion with respect to the validity or enforceability of any contract,
agreement or other instrument provisions to the extent they may be limited by
(i) applicable bankruptcy, insolvency, liquidation, fraudulent transfer,
moratorium, reorganization, or other similar laws affecting creditors’ rights
generally; (ii) general equitable principles and rules of law governing specific
performance, estoppel, waiver, injunctive relief, and other equitable remedies
(regardless of whether enforcement is sought in a proceeding at law or in
equity), and the discretion of any court before which a proceeding may be
brought; (iii) duties and standards of good faith, reasonableness and fair
dealing imposed on parties to contracts; and (iv) a court determination that any
fees payable pursuant to a provision requiring the payment of attorneys’ fees is
reasonable.
We have participated in conferences with
officers and other representatives of the Company, the Representatives and the independent
registered public accounting firm of the Company, at which conferences the
contents of the Registration Statement and the Prospectus contained therein and
related matters were discussed and, although we are not passing upon and do not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement and the Prospectus contained therein,
solely on the basis of the foregoing without independent check and
verification, no facts have come to our
attention which lead us to believe that the Registration Statement or any
amendment thereto, at the time the Registration Statement or amendment became
effective, 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 materially
misleading or the Prospectus or any amendment or supplement thereto, at the time
they were filed pursuant to Rule 424(b) or at the date of this opinion, 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 statement therein, in light of the
circumstances under which they were made, not materially misleading
(except that we express no view and shall
not be deemed to have rendered an opinion with respect to the financial
information, statistical data and information and matters regarding non-United
States laws, rules and regulations included in the Registration Statement or the
Prospectus).
November 18, 2010
Page 7
This opinion is furnished by us as
counsel to the Company, to you, the Underwriters, in connection with the
transactions contemplated by the Underwriting Agreement, is solely for the
benefit of the Underwriters and may not be delivered to, quoted or relied upon by
any other party, or for any other purpose, without our express written consent.
Our opinion is expressly limited to the matters set forth above and we render no
opinion, whether by implication or otherwise, as to any other matters relating to the Company.
We assume no obligation to advise you of facts, circumstances, events or
developments which hereafter may be brought to our attention and which may
alter, affect or modify the opinions expressed herein.
| Very truly yours, | |
| /s/ SICHENZIA ROSS FRIEDMAN FERENCE LLP | |
| SICHENZIA ROSS FRIEDMAN FERENCE LLP |