The term “underwriter” as defined by Securities Act Section 2(11) means:
[A]ny person who has purchased from an issuer with a view to, or offers or sells for an issuer in connection with, the distribution of any security, or participates or has a direct or indirect participation in any such undertaking, or participates or has a participation in the direct or indirect underwriting of any such undertaking; but such term shall not include a person whose interest is limited to a commission from an underwriter or dealer not in excess of the usual and customary distributors’ or sellers’ commission. As used in this paragraph or indirectly controlling or controlled by the issuer, or any person under direct or indirect common control with the issuer.
The key element in the analysis as to whether or not any Shareholder is an underwriter is whether the Shares were purchased with a view to participate in or engage in a “distribution” of the Issuer’s securities. Distribution is not defined by the Securities Act , but is essentially synonymous with “public offering.”