ANDRX CORPORATION
7,350,000 Shares
Common Stock
($0.001 Par Value)
UNDERWRITING AGREEMENT
, 2000
UNDERWRITING AGREEMENT
, 0000
XXXX XX XXXXXXX SECURITIES LLC
BEAR, XXXXXXX & CO. INC.
CIBC XXXXXXXXXXX CORP.
WARBURG DILLON READ LLC
as Managing Underwriters
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
ANDRX CORPORATION, a Florida corporation (the "Company"), proposes to
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issue and sell and the persons named in Schedule B annexed hereto (the "Selling
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Stockholders") propose to sell to the underwriters named in Schedule A annexed
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hereto (the "Underwriters"), for whom Banc of America Securities LLC ("BOA"),
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Bear Xxxxxxx & Co. Inc. ("Bear Xxxxxxx"), CIBC Xxxxxxxxxxx Corp. and Warburg
Dillon Read LLC are acting as managing underwriters (collectively, the "Managing
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Underwriters"), an aggregate of 7,350,000 shares (the "Firm Shares") of Common
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Stock, $0.001 par value (the "Common Stock"), of the Company, of which 6,001,684
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shares are to be issued and sold by the Company and an aggregate of 1,348,316
shares are to be sold by the Selling Stockholders in the respective amounts set
forth under the caption "Firm Shares" in Schedule B annexed hereto. In addition,
solely for the purpose of covering over-allotments, Company and the Selling
Stockholders propose to grant to the Underwriters the option to purchase from
the Company and the Selling Stockholders up to an additional 1,102,500 shares of
Common Stock (the "Additional Shares"), of which the Company will grant an
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option to purchase 52,500 shares and each Selling Stockholder will grant an
option to purchase an aggregate of 1,050,000 shares in the respective amounts
set forth under the caption "Additional Shares" in Schedule B. The Firm Shares
and the Additional Shares are hereinafter collectively sometimes referred to as
the "Shares." The Shares are described in the Prospectus which is referred
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to below.
The Company has filed, in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations thereunder
(collectively called the "Act"), with the Securities and Exchange Commission
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(the "Commission") a registration statement on Form S-3 (File No. 333- ),
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including a prospectus relating to the Shares which incorporates by reference
documents which the Company has filed in accordance with the provisions of the
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder (collectively called the "Exchange Act"). The Company has furnished
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to you, for use by the Underwriters and by dealers, copies of one or more
preliminary prospectuses and the documents incorporated by reference therein
(each thereof, including the
documents incorporated therein by reference, being herein called a "Preliminary
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Prospectus") relating to the Shares. Except where the context otherwise
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requires, the registration statement, as amended when it becomes effective,
including all documents filed as a part thereof or incorporated by reference
therein, and including any information contained in a prospectus subsequently
filed with the Commission pursuant to Rule 424(b) under the Act and deemed to be
part of the registration statement at the time of effectiveness pursuant to Rule
430A under the Act and also including any registration statement filed pursuant
to Rule 462(b) under the Act, is herein called the "Registration Statement," and
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the prospectus, including all documents incorporated therein by reference, in
the form filed by the Company with the Commission pursuant to Rule 424(b) under
the Act on or before the second business day after the date hereof (or such
earlier time as may be required under the Act) or, if no such filing is
required, the form of final prospectus included in the Registration Statement at
the time it became effective, is herein called the "Prospectus."
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The Company, the Selling Stockholders and the Underwriters agree as
follows:
1. Sale and Purchase. Upon the basis of the warranties and
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representations and subject to the terms and conditions herein set forth, the
Company and each of the Selling Stockholders, severally and not jointly, agree
to sell to the respective Underwriters and each of the Underwriters, severally
and not jointly, agrees to purchase from the Company and each Selling
Stockholder the respective number of Firm Shares (subject to such adjustment as
you may determine to avoid fractional shares) which bears the same proportion to
the number of Firm Shares to be sold by the Company or by such Selling
Stockholders, as the case may be, as the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule A bears to the total number of
Firm Shares to be sold by the Company and the Selling Stockholders, in each case
at a purchase price of $ per Share. The Company and each Selling Stockholder
is advised by you that the Underwriters intend (i) to make a public offering of
their respective portions of the Firm Shares as soon after the effective date of
the Registration Statement as in your judgment is advisable and (ii) initially
to offer the Firm Shares upon the terms set forth in the Prospectus. You may
from time to time increase or decrease the public offering price after the
initial public offering to such extent as you may determine.
In addition, the Company and the Selling Stockholders listed on
Schedule B hereto hereby grant to the several Underwriters the option to
purchase, and upon the basis of the warranties and representations and subject
to the terms and conditions herein set forth, the Underwriters shall have the
right to purchase, severally and not jointly, from the Company and the Selling
Stockholders listed on Schedule B hereto, ratably in accordance with the number
of Firm Shares to be purchased by each of them (subject to such adjustment as
you shall determine to avoid fractional shares), all or a portion of the
Additional Shares as may be necessary to cover over-allotments made in
connection with the offering of the Firm Shares, at the same purchase price per
share to be paid by the Underwriters to the Company and the Selling Stockholders
listed on Schedule B hereto for the Firm Shares. This option may be exercised by
you on behalf of the several Underwriters at any time (but not more than once)
on or before the thirtieth day following the date hereof, by written notice to
the Company and the Selling Stockholders listed on Schedule B hereto. Such
notice shall set forth the aggregate number of Additional Shares as to which the
option is being exercised, and the date and time when the Additional Shares are
to be delivered (such date and time being herein referred to as the "additional
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time of purchase"); provided,
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however, that the additional time of purchase shall not be earlier than the time
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of purchase (as defined below) nor earlier than the second business day/1/ after
the date on which the option shall have been exercised nor later than the tenth
business day after the date on which the option shall have been exercised. The
number of Additional Shares to be sold to each Underwriter shall be the number
which bears the same proportion to the aggregate number of Additional Shares
being purchased as the number of Firm Shares set forth opposite the name of such
Underwriter on Schedule A bears to the total number of Firm Shares (subject, in
each case, to such adjustment as you may determine to eliminate fractional
shares).
Pursuant to powers of attorney (collectively, "Powers of Attorney"),
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which shall be satisfactory to counsel for the Underwriters, granted by each
Selling Stockholder, and will act as representatives of the
Selling Stockholders (the "Representatives of the Selling Stockholders"). The
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Representatives of the Selling Stockholders are authorized, on behalf of each
Selling Stockholder, to execute any documents necessary or desirable in
connection with the sale of the Shares to be sold hereunder by each Selling
Stockholder, to make delivery of the certificates of such Shares, to receive the
proceeds of the sale of such Shares, to give receipts for such proceeds, to pay
therefrom the expenses to be borne by each Selling Stockholder in connection
with the sale and public offering of the Shares, to distribute the balance of
such proceeds to each Selling Stockholder in proportion to the number of Shares
sold by each Selling Stockholder, to receive notices on behalf of each Selling
Stockholder and to take such other action as may be necessary or desirable in
connection with the transactions contemplated by this Agreement.
2. Payment and Delivery. Payment of the purchase price for the Firm
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Shares shall be made to the Company and each of the Selling Stockholders by
Federal Funds wire transfer, against delivery of the certificates for the Firm
Shares to you through the facilities of The Depository Trust Company ("DTC") for
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the respective accounts of the Underwriters. Such payment and delivery shall be
made at 10:00 A.M., New York City time, on , 2000 (unless another time
shall be agreed to by you, the Company and the Representatives of the Selling
Stockholders or unless postponed in accordance with the provisions of Section 10
hereof). The time at which such payment and delivery are actually made is
hereinafter sometimes called the "time of purchase." Certificates for the Firm
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Shares shall be delivered to you in definitive form in such names and in such
denominations as you shall specify no later than the second business day
preceding the time of purchase. For the purpose of expediting the checking of
the certificates for the Firm Shares by you, the Company and the Selling
Stockholders agree to make such certificates available to you for such purpose
at least one full business day preceding the time of purchase.
Payment of the purchase price for the Additional Shares shall be made
at the additional time of purchase in the same manner and at the same office as
the payment for the Firm Shares. Certificates for the Additional Shares shall be
delivered to you in definitive form in such names and in such denominations as
you shall specify no later than the second business day preceding the additional
time
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1 As used herein "business day" shall mean a day on which the New York
Stock Exchange is open for trading.
of purchase. For the purpose of expediting the checking of the certificates for
the Additional Shares by you, the Company and the Selling Stockholders agree to
make such certificates available to you for such purpose at least one full
business day preceding the additional time of purchase.
The Selling Stockholders will pay all applicable state transfer taxes,
if any, involved in the transfer to the several Underwriters of the Shares to be
purchased by them from the Selling Stockholders.
3. Representations and Warranties of the Company. The Company
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represents and warrants to each of the Underwriters that:
(a) the Company has not received, and has no notice of, any order of
the Commission preventing or suspending the use of any Preliminary Prospectus,
or instituting proceedings for that purpose, and each Preliminary Prospectus, at
the time of filing thereof, conformed in all material respects to the
requirements of the Act; the Registration Statement has been declared effective
by the Commission; no stop order suspending the effectiveness of the
Registration Statement is in effect and no proceedings for such purpose have
been instituted or are pending or, to the best knowledge of the Company, are
contemplated or threatened by the Commission; the Registration Statement and the
Prospectus will fully comply in all material respects with the provisions of the
Act, and the Registration Statement 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 not misleading, and the Preliminary
Prospectus and the Prospectus 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 light of the circumstances under which they
were made, not misleading; the documents incorporated by reference in the
Preliminary Prospectus and the Prospectus, at the time they were filed (or, if
an amendment with respect to any such document was filed, when such amendment
was filed) with the Commission, complied in all material respects with the
requirements of the Exchange Act, and do 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 light of the circumstances under
which they were made, not misleading; and the Company has not distributed any
offering material in connection with the offering or sale of the Shares other
than the Registration Statement, the Preliminary Prospectus, the Prospectus or
any other materials, if any, permitted by the Act; provided, however, that the
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Company makes no warranty or representation with respect to any statement
contained in the Registration Statement, the Preliminary Prospectus or the
Prospectus in reliance upon and in conformity with information concerning the
Underwriters and furnished in writing by or on behalf of any Underwriter through
you to the Company expressly for use in the Registration Statement, the
Preliminary Prospectus or the Prospectus;
(b) the Company has delivered to the Managing Underwriters four
complete manually signed copies of the Registration Statement and of each
consent and certificate of experts filed as a part thereof, and conformed copies
of the Registration Statement (without exhibits) and Preliminary Prospectuses
and the Prospectus, as amended or supplemented, in such quantities and at such
places as the Managing Underwriters have reasonably requested for each of the
Underwriters;
(c) as of the date of this Agreement, the Company has an authorized
capitalization as set forth under the heading entitled "Actual" in the section
of the Registration Statement and the Pro-
spectus entitled "Capitalization" and, as of the time of purchase and the
additional time of purchase, as the case may be, the Company shall have an
authorized capitalization as set forth under the heading entitled "As Adjusted"
in the section of the Registration Statement and the Prospectus entitled
"Capitalization"; all of the issued and outstanding shares of capital stock
(including the Common Stock owned by Selling Stockholders) have been duly and
validly authorized and issued and are fully paid and non-assessable, have been
issued in compliance with all federal and state securities laws and were not
issued in violation of any preemptive rights, resale rights, right of first
refusal or similar rights; there are no authorized or outstanding options,
warrants, preemptive rights, rights of first refusal or other rights to
purchase, or equity or debt securities convertible into or exchangeable or
exercisable for, any capital stock of the Company or any of its subsidiaries
other than those accurately described in the Prospectus. The description of the
Company's stock option, stock bonus and other plans or arrangements, and the
options or other rights granted thereunder, set forth in the Prospectus
accurately and fairly represents the information required to be shown with
respect to such plans, arrangements, options and rights;
(d) the Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Florida, with full
power and authority to own, lease and operate its properties and conduct its
business as described in the Registration Statement and Prospectus;
(e) the Company is duly qualified to do business as a foreign
corporation in good standing in each jurisdiction where the ownership or leasing
of its properties or the conduct of its business requires such qualification,
except where the failure to so qualify would not have a material adverse effect
on the business, properties, condition (financial or otherwise), results of
operation or prospects of the Company, its Subsidiaries (as hereinafter defined)
and ANCIRC (as hereinafter defined) taken as a whole (a "Material Adverse
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Effect"). The Company has no subsidiaries (as defined in the Exchange Act) other
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than those entities listed on Schedule C hereto (collectively, the
"Subsidiaries"); other than the Subsidiaries and ownership of 50% of the
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outstanding capital stock of ANCIRC Pharmaceuticals, an unincorporated joint
venture ("ANCIRC"), the Company does not own, directly or indirectly, any shares
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of stock or any other equity or long-term debt securities of any corporation or
have any equity interest in any firm, partnership, joint venture, association or
other entity; complete and correct copies of the certificates of incorporation
and of the bylaws of the Company and the Subsidiaries and of the definitive
documentation organizing ANCIRC (the "JV Documentation") and all amendments
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thereto have been delivered to you, and no changes therein will be made
subsequent to the date hereof and prior to the time of purchase or, if later,
the additional time of purchase; each Subsidiary has been duly incorporated and
is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, with full corporate power and authority to
own, lease and operate its properties and to conduct its business as described
in the Registration Statement and Prospectus; each Subsidiary is duly qualified
to do business as a foreign corporation in good standing in each jurisdiction
where the ownership or leasing of its properties or the conduct of its business
requires such qualification (and ANCIRC requires no such qualification), except
where the failure to so qualify would not have a Material Adverse Effect; all of
the outstanding shares of capital stock of each of the Subsidiaries and ANCIRC
have been duly authorized and validly issued, are fully paid and non-assessable
and (except, with regard to ANCIRC, as otherwise stated in the Registration
Statement) are owned by the Company,
except as set forth on Schedule C, subject to no security interest, other
encumbrance or adverse claim; no options, warrants or other rights to purchase,
agreements or other obligations to issue or other rights to convert any
obligation into shares of capital stock or ownership interests the Company, its
Subsidiaries or ANCIRC are outstanding except as otherwise stated in the
Registration Statement;
(f) neither the Company, any of its Subsidiaries nor ANCIRC is in
breach of, or in default under (nor has any event occurred which with notice,
lapse of time, or both would result in any breach of, or constitute a default
under), its respective charter or bylaws (or, in the case of ANCIRC, the JV
Documentation) or in the performance or observance of any obligation, agreement,
covenant or condition contained in any license, indenture, mortgage, deed of
trust, bank loan or credit agreement or other evidence of indebtedness, or any
lease, contract or other agreement or instrument to which the Company, any of
its Subsidiaries or ANCIRC is a party or by which any of them or any of their
properties may be bound or affected, and the execution, delivery and performance
of this Agreement, the issuance and sale of the Shares and the consummation of
the transactions contemplated hereby will not conflict with, or result in any
breach of or constitute a default under (nor constitute any event which with
notice, lapse of time or both would result in any breach of or constitute a
default under), any provisions of the charter or bylaws of the Company or any of
its Subsidiaries, under any provisions of the JV Documentation or under any
provision of any license, indenture, mortgage, deed of trust, bank loan, credit
agreement or other evidence of indebtedness, or any lease, contract or other
agreement or instrument to which the Company, any of its Subsidiaries or ANCIRC
is a party or by which any of them or their respective properties may be bound
or affected, or under any federal, state, local or foreign law, regulation or
rule or any decree, judgment or order applicable to the Company, any of its
Subsidiaries or ANCIRC;
(g) this Agreement and each Custody Agreement (as defined below) have
each been duly authorized, executed (or in the case of the Custody Agreements
acknowledged) and delivered by the Company and are legal, valid and binding
agreements of the Company enforceable in accordance with their respective terms;
(h) the capital stock of the Company, including the Shares, conforms
in all material respects to the description thereof contained in the
Registration Statement and Prospectus and the certificates for the Shares are in
due and proper form and the holders of the Shares will not be subject to
personal liability by reason of being such holders;
(i) the Common Stock (including the Shares) is registered pursuant to
Section 12(g) of the Exchange act and is listed on the National Association of
Securities Dealers Automated Quotation National Market System ("NASDAQ"), and
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
delisting the common Stock from the Nasdaq National Market, nor has the Company
received any notification that the Commission or the National Association of
Securities Dealers, Inc. (the "NASD") is contemplating terminating such
registration or listing;
(j) the Shares to be purchased by the Underwriters from the Company
have been duly and validly authorized and, when issued and delivered against
payment therefor as provided herein, will be duly and validly issued and fully
paid and non-assessable;
(k) no approval, authorization, consent or order of or filing with any
national, state or local governmental or regulatory commission, board, body,
authority or agency is required in connection with the issuance or sale of the
Shares or the consummation by the Company of the transactions as contemplated
hereby other than registration of the Shares under the Act and any necessary
qualification under the securities or blue sky laws or Canadian provincial
securities laws of the various jurisdictions in which the Shares are being
offered by the Underwriters or under the rules and regulations of the NASD;
(l) except as otherwise stated in the Registration Statement, no
person has the right, contractual or otherwise, to cause the Company to issue to
it, or register pursuant to the Act, any equity or debt securities of the
Company upon the issue and sale of the Shares to the Underwriters hereunder
(other than the Selling Stockholders with respect to the Shares), nor does any
person have preemptive rights, co-sale rights, rights of first refusal or other
rights to purchase any of the Shares other than those that have been expressly
waived prior to the date hereof;
(m) Xxxxxx Xxxxxxxx LLP, whose report on the consolidated financial
statements of the Company and its Subsidiaries is filed with the Commission as
part of the Registration Statement and Prospectus, are independent public
accountants as required by the Act;
(n) there are no legal or governmental proceedings, statutes,
regulations, contracts, licenses, agreements, leases or documents of a character
which are required to be filed as exhibits to the Registration Statement or to
be summarized or described in the Prospectus which have not been so filed,
summarized or described;
(o) the audited financial statements included in the Registration
Statement and the Prospectus present fairly the consolidated financial position
of the Company and its Subsidiaries (including the Company's equity interest in
ANCIRC) as of the dates indicated and the consolidated results of operations and
cash flows of the Company and its Subsidiaries (including the Company's equity
interest in ANCIRC) for the periods specified; such financial statements have
been prepared in conformity with generally accepted accounting principles
applied on a consistent basis during the periods involved; no other financial
statements are required to be included in the Registration Statement; the
financial data set forth in the Prospectus under the captions "Prospectus
Summary -- Summary Consolidated Financial Data" and "Selected Consolidated
Financial Data" fairly present the information set forth therein on a basis
consistent with that of the audited financial statements contained in the
Registration Statement;
(p) subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not been (i)
any material adverse change or any development which is likely to cause a
material adverse change in the business, properties or assets described or
referred to in the Registration Statement and the Prospectus, or a Material
Adverse Effect, (ii) any
transaction which is material to the Company, its Subsidiaries or ANCIRC taken
as a whole, except transactions in the ordinary course of business, (iii) any
obligation, direct or contingent, which is material to the Company, its
Subsidiaries or ANCIRC, incurred by the Company, its Subsidiaries or ANCIRC,
except obligations incurred in the ordinary course of business, (iv) any change
in the capital stock or outstanding indebtedness of the Company, its
Subsidiaries or ANCIRC or (v) any dividend or distribution of any kind declared,
paid or made on the capital stock of the Company. Neither the Company nor any of
its Subsidiaries has any material contingent obligation which is not disclosed
in the Registration Statement and the Prospectus;
(q) the Company has obtained the agreement of Xxxx X. Xxxxx, Xxxx-Xxxx
X. Xxxx, PH.D., Xxxxxx X. Xxxx, PH.D. and Xxxxx Xxxxx (collectively the
"Management Selling Stockholders") and of its directors and officers through
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letters (collectively, the "Lock-Up Letters") not to sell, offer to sell,
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contract to sell, hypothecate, grant any option to purchase or otherwise dispose
of, directly or indirectly, any shares of Common Stock or securities convertible
into or exchangeable for Common Stock or warrants or other rights to purchase
Common Stock for a period of 90 days after the date of the Prospectus;
(r) the Company, its Subsidiaries and ANCIRC own or possess the right
to use all patents, trademarks (including the Company's name, together with its
logo), trademark registrations, service marks, service xxxx registrations, trade
names, copyrights, licenses, inventions, trade secrets, know-how and rights
described in the Prospectus as being owned by them or any of them or necessary
for the conduct of their respective businesses, and the Company is not aware of
any claim to the contrary or any challenge by any other person to the rights of
the Company, its Subsidiaries and ANCIRC with respect to the foregoing. Except
as described in the Prospectus, no claim has been made against or notice given
to the Company, its Subsidiaries or ANCIRC alleging the infringement or other
violation by the Company, its Subsidiaries or ANCIRC of any patent, trademark,
service xxxx, trade name, copyright, trade secret, license or other intellectual
property right or franchise right of any person;
(s) the Company is not and, after giving effect to the offering and
sale of the Shares, will not be an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in the
Investment Company Act of 1940, as amended (the "Investment Company Act");
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(t) except for matters which, individually or in the aggregate, could
not have a Material Adverse Effect, (i) each of the Company, its Subsidiaries
and ANCIRC has obtained all permits, licenses and other authorizations, consents
and approvals which are required under the Environmental Laws (as defined
below), (ii) each of the Company, its Subsidiaries and ANCIRC is in full
compliance with all terms and conditions of all permits, licenses and
authorizations required under the Environmental Laws, (iii) each of the Company,
its Subsidiaries and ANCIRC is in full compliance with all limitations,
restrictions, conditions, standards, prohibitions, requirements, obligations,
schedules and timetables contained in the Environmental Laws or contained in any
regulation, code, plan, consent or other order, decree, judgment, notice of
violation or other notice, or demand letter issued, entered, promulgated or
approved thereunder (collectively, the "Environmental Requirements"), (iv) no
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officer of the Company is aware of nor has he or she received (A) notice
(written or oral) from a governmental
authority, citizens group, employee or otherwise that alleges that the Company,
any of its Subsidiaries or ANCIRC is not in full compliance with one or more
Environmental Requirements, or (B) notice (written or oral) respecting the
Company, any of its Subsidiaries or ANCIRC of any past, present or future
events, conditions, circumstances, activities, practices, incidents, actions or
plans that may interfere with or prevent continued compliance with all
Environmental Requirements, or that may give rise to any common law or other
legal liability or otherwise form the basis of any claim, action, suit,
proceeding, hearing or investigation (each, an "Action"), based on or related to
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the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling, or the emission, discharge, release or threatened
release, of any chemical, pollutant, contaminant, or hazardous or toxic material
or waste or petroleum or petroleum products into ambient air, surface water,
ground water or land, and (v) there is no Action relating to any Environmental
Requirement pending or, to the best knowledge of the Company, threatened against
or affecting (A) the Company, any of its Subsidiaries, ANCIRC or their
respective properties, or (B) any person or entity whose liability for such
Action has or may have been retained or assumed either contractually or by
operation of law by the Company, any of its Subsidiaries or ANCIRC.
"Environmental Laws" shall mean Federal, state and local laws relating to
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pollution or protection of human health or the environment, including, without
limitation, laws (including the common law) relating to emissions, discharges,
releases or threatened releases of chemicals, pollutants, contaminants or
hazardous or toxic materials or wastes or petroleum or petroleum products into
ambient air, surface water, ground water or land, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of chemicals, pollutants, contaminants or hazardous or
toxic materials or wastes or petroleum or petroleum products;
(u) except as described in the Registration Statement or the
Prospectus, there is no action, suit, investigation or proceeding pending or to
the knowledge of the Company, threatened or contemplated before or by any
Federal or state court, commission, regulatory body, administrative agency or
other governmental body, domestic or foreign, including, without limitation, the
Commission, the Food and Drug Administration (the "FDA"), the Drug Enforcement
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Administration (the "DEA") or the Department of Justice (the "DOJ"), or
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arbitrator to which the Company, any of its Subsidiaries or ANCIRC is or may
become a party or of which any property of the Company, any of its Subsidiaries
or ANCIRC is subject or affected, at law or equity, that (A) might affect the
consummation of the transactions contemplated under this Agreement, including
the issuance or validity of the Shares, (B) might have a Material Adverse
Effect, (C) is required to be disclosed in the Registration Statement or the
Prospectus and is not so disclosed or (D) relates to a material violation of the
Federal Food, Drug and Cosmetic Act (the "FDC Act") (and each state's equivalent
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of said act), the Federal Controlled Substances Act (and each state's equivalent
of such act) (collectively, the "CSA"), or any regulations promulgated
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thereunder which violations might have a Material Adverse Effect. All pending
legal or governmental proceedings to which the Company, any of its Subsidiaries
or ANCIRC is a party or of which any of their respective properties are subject
or affected which are not described in the Prospectus, including ordinary
routine litigation incidental to the business, would not have a Material Adverse
Effect;
(v) none of the Company, any of its Subsidiaries or ANCIRC has
received any notice, or warning letter from the FDA, the DEA or the DOJ, that
any product ever manufactured or marketed by the Company, any of its
Subsidiaries or ANCIRC is, or is alleged to be, an unapproved, adulterated or
misbranded drug or controlled substance including, without limitation, (1) an
order or
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request from the FDA, the DEA or the DOJ or other authorized governmental or
regulatory body that the Company, any of its Subsidiaries or ANCIRC recall or
withdraw from the market or cease to market any product sold or manufactured by
the Company, other than product recalls of products marketed by Anda Generics,
Inc., which have had no Material Adverse Effect or (2) a lawsuit filed by the
United States with respect to any product sold or manufactured by the Company or
against the Company, any of its Subsidiaries or ANCIRC or any of their
respective officers, directors or employees alleging that any of the Company's,
any of its Subsidiaries' or ANCIRC's products is an unapproved, adulterated or
misbranded drug or controlled substance, or (3) an order from the FDA debarring
the Company, any of its Subsidiaries or ANCIRC or any of their respective
officers, directors or employees from submitting or participating in the
submission of abbreviated new drug applications (the "ANDAs");
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(w) except as disclosed in the Registration Statement and Prospectus,
none of the Company, any of its Subsidiaries or ANCIRC has been served with any
complaint or received any other notice of lawsuits, arbitrations, legal or
administrative or regulatory proceedings, charges, complaints or investigations
by any state regulatory agency against or pending against or relating to any
Permits (as hereinafter defined). There have not been any drug application
withdrawals, product recalls or similar actions by the Company, any of its
Subsidiaries or ANCIRC. All pre-clinical and clinical studies conducted by or on
behalf of the Company, each of its Subsidiaries and ANCIRC as well as all
manufacturing, labeling, and distribution of materials related to all drug
development activities, have been conducted in compliance in all material
respects with applicable FDA and DEA rules and regulations, including but not
limited to the FDA's good laboratory practice and good manufacturing practice
requirements. Neither the Company, any of the Subsidiaries nor ANCIRC, nor any
of their respective officers, directors or employees have been debarred by the
FDA from submitting or participating in the submission of ANDAs. The FDA has not
refused to file any ANDA submitted by the Company, any of its Subsidiaries or
ANCIRC;
(x) the Company is not aware that any of the products sold or being
developed by the Company, any of its Subsidiaries or ANCIRC are unsafe or
inefficacious;
(y) the Company, each of its Subsidiaries and ANCIRC have such
licenses, consents, permits and other approvals and has made all necessary
filings required under any federal, state or local and foreign law, regulation
or rule, and has obtained all authorizations of and from governmental or
regulatory authorities ("Permits") as are necessary under applicable law to own
their respective properties and to conduct their respective businesses in the
manner now being conducted and as described in the Registration Statement and
the Prospectus, including, but not limited to state drug wholesale distributor
registrations, licenses or permits and letters of reference to drug master files
established by other companies, except such Permits which individually or in the
aggregate could not have a Material Adverse Effect; and the Company, each of the
Subsidiaries and ANCIRC have fulfilled and performed all of their respective
obligations with respect to such Permits, and no event has occurred which
allows, or after notice or lapse of time or both would allow, revocation or
termination thereof or result in any other material impairment of the rights of
the holder of any such Permits except such Permits which individually or in the
aggregate could not have a Material Adverse Effect. Neither the Company, any of
the Subsidiaries nor ANCIRC has ever been denied a Permit of the type referred
to in this Section 3(y);
-11-
(z) all necessary new drug applications (the "NDAs"), ANDAs,
----
investigational new drug applications (the "INDs"), premarket approval
----
applications and amendments and or supplements thereto, as required by the FDC
Act, the regulations of the FDA adopted thereunder, and any policies issued by
the FDA in connection with such INDs, NDAs or ANDAs, premarket approval
applications and amendments and/or supplements thereto, have been filed with FDA
for the Company's proposed generic versions of Prilosec, Naprelan, Tiazac,
Wellbutrin SR, Zyban, K-Dur, Claritin D-24 and Depakote;
(aa) each of the Company, its Subsidiaries and ANCIRC has timely filed
all Federal, state, local and foreign tax returns which are required to be filed
through the date hereof, or has received extensions thereof, and has paid all
taxes shown on such returns and all assessments received by it to the extent
that the same are material and have become due. The Company has no knowledge,
nor any reasonable grounds to know, of any tax deficiencies which would have a
Material Adverse Effect; each of the Company, its Subsidiaries and ANCIRC has
paid all taxes which have become due, whether pursuant to any assessment, or
otherwise, and there is no further liability (whether or not disclosed on such
returns) or assessment for any such tax, and no interest or penalties accrued or
accruing with respect thereto, except as may be set forth or adequately reserved
for in the consolidated financial statements included in the Registration
Statement and the Prospectus; the amounts currently set up as provisions for
taxes or otherwise by the Company, its Subsidiaries and ANCIRC on their books
and records are sufficient for the payment of all their unpaid federal, foreign,
state, country and local taxes accrued through the dates as of which they speak,
and for which the Company, its Subsidiaries and ANCIRC may be liable in their
own right, or as a transferee of the assets of, or as successor to any other
corporation, association, partnership, joint venture or other entity;
(bb) the Company, each of its Subsidiaries and ANCIRC are insured by
insurers of recognized financial responsibility against such losses and risks
and in such amounts as are customary in the businesses in which they are
engaged, including, but not limited to, policies covering real and personal
property owned or leased by the Company, its Subsidiaries and ANCIRC against
theft, damage, destruction, acts of vandalism and earthquakes; and neither the
Company, any of the Subsidiaries nor ANCIRC has any reason to believe that it
will not be able to renew its existing insurance coverage as and when such
coverage expires or to obtain similar coverage from similar insurers as may be
necessary to continue its business at a cost that would not have a Material
Adverse Effect;
(cc) except as otherwise stated in the Registration Statement, the
Company does not expect that the Company, any of its Subsidiaries or ANCIRC will
have following the time of purchase and the additional time of purchase, as the
case may be, any liability for any prohibited transaction or funding deficiency
or any complete or partial withdrawal liability with respect to any pension,
profit sharing or other plan which is subject to the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), to which the Company, any of its
Subsidiaries or ANCIRC makes or ever has made a contribution and in which any
employee of the Company, any of its Subsidiaries or ANCIRC is or has ever been a
participant. With respect to such plans, the Company, each of its Subsidiaries
and ANCIRC are in compliance in all material respects with all applicable
provisions of ERISA;
-12-
(dd) The Company has not distributed and will not distribute, prior to
the later of the additional time of purchase and the completion of the
Underwriters' distribution of the Shares, any offering material in connection
with the offering and sale of the Shares other than the Prospectus or the
Registration Statement;
(ee) each of the Company, its Subsidiaries and ANCIRC has good and
marketable title to all real property and good title to all personal property
described in the Registration Statement as being owned by it and good and
marketable title to a leasehold estate in the real and personal property
described in the Registration Statement as being leased by it free and clear of
all liens, charges, encumbrances or restrictions, except as described in the
Registration Statement or to the extent the failure to have such title or the
existence of such liens, charges, encumbrances or restrictions would not,
individually or in the aggregate, have a Material Adverse Effect. All leases,
contracts and agreements to which the Company, any of its Subsidiaries or ANCIRC
is a party or by which any of them is bound are valid and enforceable against
the Company, such Subsidiary or ANCIRC, and are valid and enforceable against
the other party or parties thereto and are in full force and effect with only
such exceptions as would not, individually or in the aggregate, have a Material
Adverse Effect;
(ff) neither the Company nor any of the Subsidiaries is involved in
any labor dispute nor, to the best knowledge of the Company, is any such dispute
threatened, which dispute could have a Material Adverse Effect. Except as set
forth in the Registration Statement and Prospectus, neither the Company nor any
of the Subsidiaries has violated any applicable safety or similar law applicable
to its business nor any Federal or state laws relating discrimination in the
hiring, promotion or pay of employees, nor any applicable Federal or state wages
and hours law, nor any provisions of the Employee Retirement Income Security Act
or the rules and regulations promulgated thereunder, the violation of any of
which could have a Material Adverse Effect;
(gg) no transaction has occurred between or among the Company, any of
the Subsidiaries and any of their officers or directors or any affiliate or
affiliates of any such officer or director that is required to be described in
and is not in the Registration Statement and the Prospectus;
(hh) the books, records and accounts of the Company, its Subsidiaries
and ANCIRC, respectively, accurately and fairly reflect, in reasonable detail,
the transactions in and dispositions of, the assets of, and the results of
operations of, the Company, its Subsidiaries or ANCIRC, as the case may be. The
Company, each of the Subsidiaries and ANCIRC maintain 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 asset accountability; (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 to any differences;
-13-
(ii) the Company has not taken, nor will take, directly or indirectly,
any action designed to, or that might be reasonably expected to, cause or result
in stabilization or manipulation of the price of its Common Stock to facilitate
the sale or resale of the Shares; and
(jj) the statistical and market-related data included in the
Prospectus are based on or derived from sources that the Company believes to be
reliable and accurate or represent the Company's good faith estimates that are
made on the basis of data derived from such sources.
4. Representations and Warranties of the Selling Stockholders. Each
----------------------------------------------------------
Selling Stockholder, severally and not jointly, represents and warrants to each
Underwriter that:
(a) such Selling Stockholder now is and at the time of delivery of
such Shares (whether the time of purchase or the additional time of purchase, as
the case may be) will be the lawful owner of the number of Shares to be sold by
such Selling Stockholder pursuant to this Agreement and has and, at the time of
delivery thereof, will have valid and marketable title to such Shares, and upon
delivery of and payment for such Shares (whether at the time of purchase or the
additional time of purchase, as the case may be), the Underwriters will acquire
valid and marketable title to such Shares free and clear of any claim, lien,
encumbrance, security interest, community property right, restriction on
transfer or other defect in title;
(b) such Selling Stockholder has and at the time of delivery of such
Shares (whether the time of purchase or the additional time of purchase, as the
case may be) will have full legal right, power and capacity, and any
authorization or approval required by law (other than those imposed by the Act
and the securities or blue sky laws of certain jurisdictions), to sell, assign,
transfer and deliver such Shares in the manner provided in this Agreement;
(c) this Agreement, such Selling Stockholder's Custody Agreement, by
and between Andrx Corporation, as custodian, and such Selling Stockholder (a
"Custody Agreement" and, together with similar custody agreements in connection
-----------------
with the transactions contemplated hereby, the "Custody Agreements"), such
------------------
Selling Stockholder's Power of Attorney and such Selling Stockholder's Lock-Up
Letter have been duly authorized, executed and delivered by or on behalf of such
Selling Stockholder and each is a legal, valid and binding agreement of such
Selling Stockholder enforceable in accordance with its terms;
(d) the execution and delivery by such Selling Stockholder of, and the
performance by such Selling Stockholder of its obligations under, this
Agreement, the Custody Agreement and the Power of Attorney will not contravene
or conflict with, result in a breach of, or constitute a default under, or
require the consent of any other party to, the charter or by- laws, or other
organizational documents of such Selling Stockholder or any other agreement or
instrument to which such Selling Stockholder is a party or by which it is bound
or under which it is entitled to any right or benefit, any provision of
applicable law or any judgment, order, decree or regulation applicable to such
Selling Stockholder of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over such Selling
Stockholder. No consent, approval, authorization or other order of, or
registration or filing with, any court or other governmental authority or
agency, is required for the con-
-14-
summation by such Selling Stockholder of the transactions contemplated in this
Agreement, except such as have been obtained or made and are in full force and
effect under the Securities Act, applicable state securities or blue sky laws
and from the NASD;
(e) when the Registration Statement becomes effective and at all times
subsequent thereto through the latest of the time of purchase, the additional
time of purchase or the termination of the offering of the Shares, the
Registration Statement and Prospectus and any supplements or amendments thereto
as such relate to such Selling Stockholder 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 not misleading;
(f) such Selling Stockholder has duly and irrevocably authorized the
Representatives of the Selling Stockholders, on behalf of such Selling
Stockholder, to execute and deliver this Agreement and any other document
necessary or desirable in connection with the transactions contemplated hereby
and to deliver the Shares to be sold by such Selling Stockholder and receive
payment therefor pursuant hereto;
(g) such Selling Stockholder has not taken and will not take, directly
or indirectly, any action designed to or that might be reasonably expected to
cause or result in stabilization or manipulation of the price of the Common
Stock to facilitate the sale or resale of the Shares;
(h) the sale of such Selling Stockholder's Shares pursuant to this
Agreement is not prompted by any information concerning the Company which is not
set forth in the Prospectus;
(i) such Selling Stockholder does not have any registration or other
similar rights to have any equity or debt securities registered for sale by the
Company under the Registration Statement or included in the offering
contemplated by this Agreement, except for such rights as are described in the
Prospectus under "Shares Eligible for Future Sale"; no consent, approval or
waiver of such Selling Stockholder is required under any instrument or agreement
in connection with the offering, sale or purchase by the Underwriters of any of
the Shares, except for consents and waivers already given by such Selling
Stockholder;
(j) all information furnished by or on behalf of such Selling
Stockholder in writing expressly for use in the Registration Statement and
Prospectus is, and at the time of purchase and the additional time of purchase
will be, true, correct, and complete in all material respects, and does not, and
at the time of purchase and the additional time of purchase will not, contain
any untrue statement of a material fact or omit to state any material fact
necessary to make such information not misleading. Such Selling Stockholder
confirms as accurate the number of shares of Common Stock set forth opposite
such Selling Stockholder's name in the Prospectus under the caption "Principal
and Selling Stockholders" (both prior to and after giving effect to the sale of
the Shares); and
(k) such Selling Stockholder has not taken and will not take, directly
or indirectly, any action designed to or that might be reasonably expected to
cause or result in stabilization or manipulation of the price of the Common
Stock to facilitate the sale or resale of the Shares.
-15-
5. Certain Covenants of the Company. The Company hereby agrees:
--------------------------------
(a) to furnish such information as may be required and otherwise to
cooperate in qualifying the Shares for offering and sale under the securities or
blue sky laws of such states and Canadian provinces as you may designate and to
maintain such qualifications in effect as long as required for the distribution
of the Shares; provided that the Company shall not be required to qualify as a
foreign corporation or to consent to the service of process under the laws of
any such state or province (except service of process with respect to the
offering and sale of the Shares); and to promptly advise you of the receipt by
the Company of any notification with respect to the suspension of the
qualification of the Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose;
(b) to make available to the Underwriters in New York City, as soon as
practicable after the Registration Statement becomes effective, and thereafter
from time to time to furnish to the Underwriters, as many copies of the
Prospectus (or of the Prospectus as amended or supplemented if the Company shall
have made any amendments or supplements thereto after the effective date of the
Registration Statement) as the Underwriters may request for the purposes
contemplated by the Act; in case any Underwriter is required to deliver a
prospectus within the nine-month period referred to in Section 10(a)(3) of the
Act in connection with the sale of the Shares, the Company will prepare promptly
upon request, but at the expense of such Underwriter, such amendment or
amendments to the Registration Statement and such prospectuses as may be
necessary to permit compliance with the requirements of Section 10(a)(3) of the
Act;
(c) to advise you promptly and (if requested by you) to confirm such
advice in writing (i) when the Registration Statement has become effective and
when any post-effective amendment thereto becomes effective and (ii) if Rule
430A under the Act is used, when the Prospectus is filed with the Commission
pursuant to Rule 424(b) under the Act (which the Company agrees to file in a
timely manner under such rules);
(d) to advise you promptly, confirming such advice in writing, of any
request by the Commission for amendments or supplements to the Registration
Statement or Prospectus or for additional information with respect thereto, or
of notice of institution of proceedings for or the entry of a stop order
suspending the effectiveness of the Registration Statement and, if the
Commission should enter a stop order suspending the effectiveness of the
Registration Statement, to make every reasonable effort to obtain the lifting or
removal of such order as soon as possible; to advise you promptly of any
proposal to amend or supplement the Registration Statement or Prospectus
including by filing any documents that would be incorporated therein by
reference, to give you a reasonable opportunity to review any such amendment or
supplement and to file no such amendment or supplement to which you shall object
in writing;
(e) to file promptly all reports and any definitive proxy or
information statement required to be filed by the Company with the Commission in
order to comply with the Exchange Act subsequent to the date of the Prospectus
and for so long as the delivery of a prospectus is required in connection with
the offering or sale of the Shares, and to promptly notify you of such filing;
-16-
(f) if necessary or appropriate, to file a registration statement
pursuant to Rule 462(b) under the Act;
(g) to furnish to you and, upon request, to each of the other
Underwriters for a period of five years from the date of this Agreement (i)
copies of any reports or other communications which the Company shall send to
its stockholders or shall from time to time publish or publicly disseminate,
(ii) copies of all annual, quarterly and current reports filed with the
Commission on Forms 10-K, 10-Q and 8-K, or such other similar form as may be
designated by the Commission, (iii) copies of documents or reports filed with
any national securities exchange on which any class of securities of the Company
is listed and (iv) such other information as you may reasonably request
regarding the Company, its Subsidiaries and ANCIRC, in each case as soon as such
communications, documents or information becomes available;
(h) to advise the Underwriters promptly of the happening of any event
known to the Company within the time during which a Prospectus relating to the
Shares is required to be delivered under the Act which would require the making
of any change in the Prospectus then being used, or in the information
incorporated therein by reference, so that the Prospectus would not include an
untrue statement of material fact or omit to state a material fact necessary to
make the statements therein, in light of the circumstances under which they are
made, not misleading, and, during such time, to prepare and furnish, at the
Company's expense, to the Underwriters promptly such amendments or supplements
to such Prospectus as may be necessary to reflect any such change and to furnish
you a copy of such proposed amendment or supplement before filing any such
amendment or supplement with the Commission;
(i) to make generally available to its security holders, and to
deliver to you, an earnings statement of the Company (which will satisfy the
provisions of Section 11(a) of the Act) covering a period of twelve months
beginning after the effective date of the Registration Statement (as defined in
Rule 158(c) of the Act) as soon as is reasonably practicable after the
termination of such twelve-month period but not later than , 2001;
(j) to furnish to its shareholders as soon as practicable after the
end of each fiscal year an annual report (including a balance sheet and
statements of income, shareholders' equity and cash flow of the Company for such
fiscal year, accompanied by a copy of the certificate or report thereon of
nationally recognized independent certified public accountants;
(k) to furnish to you five signed copies of the Registration
Statement, as initially filed with the Commission, and of all amendments thereto
(including all exhibits thereto and documents incorporated by reference therein)
and sufficient conformed copies of the foregoing (other than exhibits) for
distribution of a copy to each of the other Underwriters;
(l) to furnish to you as early as practicable prior to the time of
purchase and the additional time of purchase, as the case may be, but not later
than two business days prior thereto, a copy of the latest available unaudited
interim consolidated financial statements, if any, of the Company and its
Subsidiaries which have been read by the Company's independent certified public
accountants, as stated in their letter to be furnished pursuant to Section 8(c)
hereof;
-17-
(m) to apply the net proceeds from the sale of the Shares in the
manner set forth under the caption "Use of Proceeds" in the Prospectus;
(n) to furnish to you, before filing with the Commission subsequent to
the effective date of the Registration Statement and during the period referred
to in paragraph (e) above, a copy of any document proposed to be filed pursuant
to Section 13, 14 or 15(d) of the Exchange Act;
(o) to maintain, at its expense, a registrar and transfer agent for
the Common Stock; and
(p) to use its best efforts to cause the Shares to be listed for
quotation on the NASDAQ.
6. Certain Covenants of the Company and the Selling Stockholders. The
-------------------------------------------------------------
Company and each of the Selling Stockholders agree with each Underwriter as
follows:
(a) the Company, in such proportions (aggregating 100%) as the number
of Shares to be sold by the Company bears to the total number of Shares or as
they otherwise may determine among themselves, will pay all expenses, fees and
taxes (other than any transfer taxes and fees and disbursements of counsel for
the Underwriters except as set forth under Section 7 hereof and (iii), (iv) or
(vi) below) in connection with (i) the preparation and filing of the
Registration Statement, each Preliminary Prospectus, the Prospectus, and any
amendments or supplements thereto, and the printing and furnishing of copies of
each thereof to the Underwriters and to dealers (including costs of mailing and
shipment), (ii) the registration, issuance, sale and delivery of the Shares by
the Company and the Selling Stockholders, (iii) the producing, word processing
and/or printing of this Agreement, any Agreement Among Underwriters, any dealer
agreements, any statements of information, each Custody Agreement, each Power of
Attorney, each Lock-Up Letter and any closing documents (including compilations
thereof) and the reproduction and/or printing and furnishing of copies of each
thereof to the Underwriters and (except closing documents) to dealers (including
costs of mailing and shipment), (iv) the qualification of the Shares for
offering and sale under state laws and the determination of their eligibility
for investment under state law as aforesaid (including the legal fees and filing
fees and other disbursements of counsel for the Underwriters) and the printing
and furnishing of copies of any blue sky surveys or legal investment surveys to
the Underwriters and to dealers, (v) any listing of the Shares on any securities
exchange or qualification of the Shares for quotation on NASDAQ and any
registration thereof under the Exchange Act, (vi) any filing for review of the
public offering of the Shares by the NASD and (vii) the performance of the
Company's and the Selling Stockholders' other obligations hereunder;
(b) for a period of 90 days after the date hereof, without the prior
written consent of BOA and Bear Xxxxxxx, the Company and the Selling
Stockholders will not issue, sell, offer or agree to sell, contract to sell,
grant any option to purchase or otherwise dispose of, directly or indirectly,
any shares of Common Stock or securities convertible into or exchangeable or
exercisable for Common Stock or warrants or other rights to purchase Common
Stock or any other securities of the Company that are substantially similar to
the Common Stock or, in the case of the Company, permit the registration under
the Act of any shares of Common Stock, except for the registration of the
Shares, the sales to
-18-
the Underwriters pursuant to this Agreement, registrations on Form S-8 or any
successor form, and for issuances of Common Stock upon the exercise of
outstanding options, warrants and debentures upon issuances pursuant to the
Company's existing stock option plan; in the event that during this period, (i)
any shares are issued pursuant to the Company's existing stock option plan or
(ii) any registration is effected on Form S-8 or on any successor form, the
Company shall obtain the written agreement of such grantee or purchaser or
holder of such registered securities that, for a period of 90 days after the
date of this Agreement, such person will not, without the prior written consent
of BOA and Bear Xxxxxxx, offer for sale, sell, distribute, grant any option for
the sale of, or otherwise dispose of, directly or indirectly, or exercise any
registration rights with respect to, any shares of Common Stock (or any
securities convertible into, exercisable for, or exchangeable for any shares of
Common Stock) owned by such person; and
(c) the Selling Stockholders will deliver to the Representative prior
to the time of purchase a properly completed and executed United States Treasury
Department Form W-9.
7. Reimbursement of Underwriters' Expenses. If the Shares are not
---------------------------------------
delivered for any reason other than the termination of this Agreement pursuant
to the first two paragraphs of Section 10 hereof or the default by one or more
of the Underwriters in its or their respective obligations hereunder, the
Company shall, in addition to paying the amounts described in Section 6(a)
hereof, reimburse the Underwriters for all of their out-of-pocket expenses,
including the fees and disbursements of their counsel.
8. Conditions of Underwriters' Obligations. The several obligations of
---------------------------------------
the Underwriters hereunder are subject to the accuracy of the representations
and warranties on the part of the Company and the Selling Stockholders on the
date hereof and at the time of purchase and at the additional time of purchase,
as the case may be), the performance by the Company and the Selling Stockholders
of their obligations hereunder and the following additional conditions
precedent:
(a) The Company shall furnish to you at the time of purchase and at
the additional time of purchase, as the case may be, an opinion of Broad and
Xxxxxx, special counsel for the Company, addressed to the Underwriters and dated
the time of purchase or the additional time of purchase, as the case may be,
with reproduced copies for each of the other Underwriters and in form and
substance satisfactory to Xxxxxx Xxxxxx & Xxxxxxx, counsel for the Underwriters,
stating that:
(i) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Florida, with full corporate power and authority to own, lease and
operate its properties and conduct its business as described in the
Registration Statement and the Prospectus, to execute and deliver this
Agreement and each Custody Agreement and to issue, sell and deliver
the Shares as herein contemplated;
(ii) the Company is duly qualified as a foreign corporation
to transact business and is in good standing in each jurisdiction in
which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business,
-19-
except for such jurisdictions where the failure to so qualify or to be
in good standing would not, individually or in the aggregate, result
in a Material Adverse Change;
(iii) each of the Subsidiaries has been duly incorporated
and is validly existing as a corporation in good standing under the
laws of its respective jurisdiction of incorporation with full
corporate power and authority to own, lease and operate its respective
properties and to conduct its respective business as described in the
Registration Statement and the Prospectus; each Subsidiary and ANCIRC
is duly qualified to do business as a foreign corporation in good
standing in each jurisdiction where the ownership or leasing of its
properties or the conduct of its business requires such qualification,
except where the failure to so qualify would not have a Material
Adverse Effect; other than the Subsidiaries and ANCIRC, the Company
does not own or control, directly or indirectly, any corporation,
association or other entity; all of the outstanding shares of capital
stock of each of the Subsidiaries and ANCIRC have been duly authorized
and validly issued, are fully paid and non-assessable and, except,
with regard to ANCIRC, as otherwise stated in the Registration
Statement, are owned by the Company, in each case subject to no
security interest, other encumbrance or adverse claim; to the best of
such counsel's knowledge, no options, warrants or other rights to
purchase, agreements or other obligations to issue or other rights to
convert any obligation into shares of capital stock or ownership
interests in the Company, its Subsidiaries or ANCIRC are outstanding,
except as otherwise stated in the Registration Statement;
(iv) the Company, its Subsidiaries and ANCIRC are each duly
qualified or licensed by each jurisdiction in which they conduct their
respective businesses and in which the failure, individually or in the
aggregate, to be so licensed or qualified could have a Material
Adverse Effect and the Company, its Subsidiaries and ANCIRC are each
duly qualified, and are each in good standing, in each jurisdiction in
which they own or lease real property or maintain an office and in
which such qualification is necessary;
(v) each of this Agreement and each Custody Agreement have
been duly authorized, executed (or in the case of the Custody
Agreements acknowledged) and delivered by, and is a valid and binding
agreement of, the Company, enforceable in accordance with its terms;
(vi) the Shares to be purchased by the Underwriters from the
Company have been duly authorized and, when issued and delivered to
and paid for by the Underwriters, will be duly and validly authorized
and issued and fully paid and non-assessable;
(vii) the Company has an authorized capitalization as set
forth in the Registration Statement and the Prospectus; the issued and
outstanding shares of capital stock of the Company (including the
Common Stock owned by the Selling Stockholders) have been duly and
validly authorized and issued, and are fully paid, nonassessable and
free
-20-
of statutory and contractual preemptive rights, resale rights, rights
of first refusal and similar rights (except as otherwise described in
the Registration Statement); there are no authorized or outstanding
options, warrants, preemptive rights, rights of first refusal or other
rights to purchase, or equity or debt securities convertible into or
exchangeable or exercisable for, any capital stock of the Company or
any of its Subsidiaries other than those accurately described in the
Prospectus; the certificates for the Shares are in due and proper form
and the holders of the Shares will not be subject to personal
liability by reason of being such holders;
(viii) the capital stock of the Company, including the
Shares, conforms to the description thereof contained in the
Registration Statement and Prospectus;
(ix) the Registration Statement, the Prospectus and each
amendment or supplement to the Registration Statement and the
Prospectus (except as to the financial statements and schedules and
other financial and statistical data contained or incorporated by
reference therein, as to which such counsel need express no opinion)
comply as to form in all material respects with the requirements of
the Act;
(x) the Registration Statement has become effective under
the Act and, to the best of such counsel's knowledge, no stop order
proceedings with respect thereto are pending or threatened under the
Act and any required filing of the Prospectus and any supplement
thereto pursuant to Rule 424 under the Act has been made in the manner
and within the time period required by such Rule 424;
(xi) The statements (i) in the Prospectus under the captions
"Description of Capital Stock", "Management's Discussion and Analysis
of Financial Condition and Results of Operations -- Liquidity and
Capital Resources", "Business -- Cybear -- Cybear Tracking Stock",
"Business -- Legal Proceedings", "Shares Eligible for Future Sale" and
"Underwriting" and (ii) in Item 14 and Item 15 of the Registration
Statement, insofar as such statements constitute matters of law,
summaries of legal matters, the Company's charter or by-law
provisions, documents or legal proceedings, or legal conclusions, has
been reviewed by such counsel and fairly present and summarize, in all
material respects, the matters referred to therein;
(xii) no approval, authorization, consent or order of or
filing with any national, state or local governmental or regulatory
commission, board, body, authority or agency is required in connection
with the issuance and sale of the Shares or the consummation by the
Company of the transactions as contemplated hereby other than
registration of the Shares under the Act (except such counsel need
express no opinion as to any necessary qualification under the state
securities or blue sky laws of the various jurisdictions in which the
Shares are being offered by the Underwriters);
(xiii) the execution (or in the case of the Custody
Agreements, the acknowledgment), delivery and performance of this
Agreement and each Custody Agreement by
-21-
the Company and the consummation by the Company of the transactions
contemplated hereby do not and will not conflict with, or result in
any breach of or constitute a default under (nor constitute any event
which with notice, lapse of time or both would result in any breach of
or constitute a default under), any provisions of the charter or
by-laws of the Company, any of its Subsidiaries or ANCIRC or under any
provision of any license, indenture, mortgage, deed of trust, bank
loan, credit agreement or other evidence of indebtedness, or any
lease, contract or other agreement or instrument to which the Company,
any of its Subsidiaries or ANCIRC is a party or by which any of them
or their respective properties may be bound or affected, or under any
federal, state, local or foreign law, regulation or rule or any
decree, judgment or order applicable to the Company, any of its
Subsidiaries or ANCIRC;
(xiv) to the best of such counsel's knowledge, neither the
Company, any of its Subsidiaries nor ANCIRC is in breach of, or in
default under (nor has any event occurred which with notice, lapse of
time or both would result in any breach of or constitute a default
under), its respective charter or bylaws (or, in the case of ANCIRC,
the JV Documentation) or in the performance or observance of any
obligation, agreement, covenant or condition contained in any
indenture, mortgage, deed of trust, bank loan or credit agreement or
other evidence of indebtedness, or any lease, contract or other
agreement or instrument to which the Company, any of its Subsidiaries
or ANCIRC is a party or by which any of them or any of their
properties may be bound or affected, or under any federal, state,
local or foreign law, regulation or rule or any decree, judgment or
order applicable to the Company, any of its Subsidiaries or ANCIRC;
(xv) to the best of such counsel's knowledge, there are no
contracts, licenses, agreements, leases or documents of a character
which are required to be filed as exhibits to the Registration
Statement or to be summarized or described in the Prospectus which
have not been so filed, summarized or described;
(xvi) to the best of such counsel's knowledge, there are no
actions, suits, claims, investigations or proceedings pending,
threatened or contemplated to which the Company, any of its
Subsidiaries or ANCIRC is subject or of which any of their respective
properties is subject, at law or in equity, or before or by any
federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency, which are required to be
described in the Prospectus but are not so described;
(xvii) the documents incorporated by reference in the
Registration Statement and Prospectus, when they were filed (or, if an
amendment with respect to any such document was filed, when such
amendment was filed) with the Commission, complied as to form in all
material respects with the Act or the Exchange Act (except as to the
financial statements and schedules and other financial and statistical
data contained or incorporated by reference therein, as to which such
counsel need express no opinion);
-22-
(xviii) the Company will not, upon consummation of the
transactions contemplated by this Agreement, be an "investment
company," or a "promoter" or "principal underwriter" for a "registered
investment company," as such terms are defined in the Investment
Company Act of 1940, as amended;
(xix) except as disclosed in the Prospectus under the
caption "Shares Eligible for Future Sale," to the best knowledge of
such counsel, there are no persons with registration or other similar
rights to have any equity or debt securities registered for sale under
the Registration Statement or included in the offering contemplated by
this Agreement, other than the Selling Stockholders, except for such
rights as have been duly waived;
(xx) such counsel has participated in conferences with
officers and other representatives of the Company, representatives of
the independent public accountants of the Company and representatives
of the Underwriters at which the contents of the Registration
Statement and Prospectus were discussed and, although such counsel is
not passing upon and does not assume responsibility for the accuracy,
completeness or fairness of the statements contained in the
Registration Statement or Prospectus (except as and to the extent
stated in subparagraphs (vi) and (vii) above), on the basis of the
foregoing nothing has come to the attention of such counsel that
causes them to believe that the Registration Statement or any
amendment thereto at the time such 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 misleading, or that the
Prospectus or any supplement thereto at the date of such Prospectus or
such supplement, and at all times up to and including the time of
purchase or additional time of purchase, as the case may be, 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, in light of the circumstances under which they were made, not
misleading (it being understood that such counsel need express no
opinion with respect to the financial statements and schedules and
other financial and statistical data included in the Registration
Statement or Prospectus).
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the General
Corporation Law of the State of Delaware, the General Corporation Law of the
State of Florida or the federal law of the United States, to the extent they
deem proper and specified in such opinion, upon the opinion (which shall be
dated the time of purchase or the additional time of purchase, as the case may
be, shall be satisfactory in form and substance to the Underwriters, shall
expressly state that the Underwriters may rely on such opinion as if it were
addressed to them and shall be furnished to the Representative) of other counsel
of good standing whom they believe to be reliable and who are satisfactory to
counsel for the Underwriters; provided, however, that such counsel shall further
state that they believe that they and the Underwriters are justified in relying
upon such opinion of other counsel, and (B) as to matters of fact, to the extent
they deem proper, on certificates of responsible officers of the Company and
public officials.
-23-
(b) The Selling Stockholders shall furnish to you at the time of
purchase and at the additional time of purchase, as the case may be, an opinion
of , counsel for the Selling Stockholders, addressed to the Underwriters
and dated the time of purchase or the additional time of purchase, as the case
may be, with reproduced copies for each of the other Underwriters and in form
and substance satisfactory to Xxxxxx Xxxxxx & Xxxxxxx, counsel for the
Underwriters, stating that:
(i) this Agreement, each Custody Agreement, each Power of
Attorney and each Lock-Up Letter have been duly authorized, executed
and delivered by or on behalf of, and is a valid and binding agreement
of, each Selling Stockholder party to such agreement;
(ii) each Selling Stockholder has full legal right, power
and capacity, and has obtained any authorization or approval required
by law (other than those imposed by the Act and the securities or blue
sky laws of certain jurisdictions), to sell, assign, transfer and
deliver the Shares to be sold by such Selling Stockholder in the
manner provided in this Agreement;
(iii) the execution and delivery by such Selling Stockholder
of, and the performance by such Selling Stockholder of its obligations
under, the Underwriting Agreement and its Custody Agreement, its Power
of Attorney and the Lock-Up Letter will not contravene or conflict
with, result in a breach of, or constitute a default under, the
charter or by-laws, partnership agreement, trust agreement or other
organizational documents, as the case may be, of such Selling
Stockholder, or, to the best of such counsel's knowledge, violate or
contravene any provision of applicable law or regulation, or violate,
result in a breach of or constitute a default under the terms of any
other agreement or instrument to which such Selling Stockholder is a
party or by which it is bound, or any judgment, order or decree
applicable to such Selling Stockholder of any court, regulatory body,
administrative agency, governmental body or arbitrator having
jurisdiction over such Selling Stockholder;
(iv) delivery of certificates for the Shares by each Selling
Stockholder pursuant hereto will pass valid and marketable title
thereto to the Underwriters, free and clear of any claim, lien,
encumbrance, security interest, community property right, restriction
on transfer or other defect in title;
(v) each of the Representatives of the Selling Stockholders
has been duly authorized by each Selling Stockholder to execute and
deliver on behalf of such Selling Stockholder this Agreement and any
other document necessary or desirable in connection with the
transactions contemplated thereby and to deliver the Shares to be sold
by such Selling Stockholder and receive payment therefor;
(vi) to the best of such counsel's knowledge, the statements
in the Prospectus under the caption "Principal and Selling
Stockholders" insofar as such statements con-
-24-
stitute a summary of the matters referred to therein present fairly
the information called for with respect to such matters;
(vii) assuming that the Underwriters purchase the Shares
which are sold by such Selling Stockholder pursuant to this Agreement
for value, in good faith and without notice of any adverse claim, the
delivery of such Shares pursuant to this Agreement will pass good and
valid title to such Common Shares, free and clear of any security
interest, mortgage, pledge, lien or other claim;
(viii) to the best of such counsel's knowledge, no consent,
approval, authorization or other order of, or registration or filing
with, any court or governmental authority or agency, is required for
the consummation by such Selling Stockholder of the transactions
contemplated in the Underwriting Agreement, except as required under
the Securities Act, applicable state securities laws, and from the
NASD.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the General
Corporation Law of the State of Delaware, the General Corporation Law of the
State of Florida or the federal law of the United States, to the extent they
deem proper and specified in such opinion, upon the opinion (which shall be
dated the time of purchase or the additional time of purchase, as the case may
be, shall be satisfactory in form and substance to the underwriters, shall
expressly state that the Underwriters may rely on such opinion as if it were
addressed to them and shall be furnished to the Representative) of other counsel
of good standing whom they believe to be reliable and who are satisfactory to
counsel for the Underwriters; provided, however, that such counsel shall further
state that they believe that they and the Underwriters are justified in relying
upon such opinion of other counsel, and (B) as to matters of fact, to the extent
they deem proper, on certificates of the Selling Stockholders and public
officials.
(c) The Company shall furnish to you at the time of purchase an
opinion of King & Spalding, special regulatory counsel for the Company,
addressed to the Underwriters and dated the time of purchase, with reproduced
copies for each of the other Underwriters and in form and substance satisfactory
to counsel for the Underwriters, stating that:
The statements under the captions "Risk Factors -- Our
business is subject to substantial litigation which could expose us to
unfavorable claims", "Risk Factors -- We are subject to antitrust
litigation and an FTC administrative proceeding relating to a
stipulation we entered into with Aventis and its affiliates which, if
adversely determined, would harm our business and financial results",
"Risk Factors -- We only have a limited number of commercialized
products and these and other products typically have declining
revenues over their product life", "Risk Factors -- The stringent
governmental regulation in our business subjects us to a costly and
time consuming approval process for our products", "Risk Factors -- We
face uncertainties related to clinical trials which could result in
delays in product development and commercialization", "Risk Factors --
Decreases in healthcare reimbursements could limit our ability to sell
our products or decrease our revenues", "Risk Factors -- Restrictive
FDA regula-
-25-
tions govern the manufacturing and distribution of our products",
"Risk Factors - - Proposed FDA regulations and recent FDA guidelines
may result in our bioequivalent products not being able to fully
utilize the 180-day marketing exclusivity period", "Business --
Product Development and Commercialization", "Business -- Patent
Litigation and Proprietary Rights" and "Business -- Government
Regulation" (collectively the "Regulatory Portion") in the
------------------
Registration Statement and the Prospectus, to the extent that the
reflect matters of law, summaries of law or regulations, or regulatory
status, are correct in all material respects, subject to the
qualifications set forth therein;
(i) Nothing has come to the attention of such
counsel that would lead such counsel to believe that the
Regulatory Portion, (a) at the time the Registration
Statement became effective, included 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 (b) as of the date of the
Prospectus and as of the time of purchase or the additional
time of purchase, as the case may be, includes an untrue
statement of a material fact or omits 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;
(ii) Nothing has come to the attention of such
counsel that would lead such counsel to believe that any of
the representations and warranties of the Company contained
in Xxxxxxxx 0(x), (x), (x), (x), (x), (x), (x) of this
Agreement are not true and correct; and
(iii) The Company's ANDAs with respect to the
generic versions of Prilosec, Naprelan, Tiazac, Wellburtin
SR, Zyban, K-Dur, Claritin D-24 and Depakote are in proper
form and have been properly filed with the FDA and accepted
for filing by the FDA.
In rendering such opinion, such counsel may rely as to
factual matters upon certificates or written statements from officers
of the Company or upon certificates of public officials.
(d) The Company shall furnish to you at the time of purchase an
opinion of Xxxxxx, Xxxxxx & Xxxxxxxx, special patent counsel for the Company,
addressed to the Underwriters and dated the time of purchase, with reproduced
copies for each of the other Underwriters and in form and substance satisfactory
to Xxxxxx Xxxxxx & Xxxxxxx, counsel for the Underwriters, stating that:
(i) The statements under the captions "Risk
Factors -- Our business is subject to substantial litigation
which could expose us to unfavorable claims", "Risk Factors
-- We depend on our patents and trade secrets and our future
success is dependent on our ability to protect these trade
secrets and not infringe on the rights of others", and
"Business -- Patent Litigation and Proprietary Rights" in
the Registration Statement and the Prospectus, to the extent
that they reflect matters of law, summaries of law or
regulations, or patent status, are correct in all material
respects, subject to the qualifications set forth therein;
and such counsel do not know of any statutes, legal and
-26-
governmental proceedings, contracts and other documents
relating to the Company's, its Subsidiaries' and ANCIRC's
patents and patent applications required to be described in
the Prospectus that are not described as required;
(ii) The Company's patent applications prepared by
such counsel have been properly prepared and filed on behalf
of the Company, its subsidiaries and ANCIRC and, to the best
of such counsel's knowledge, the Company's, its
Subsidiaries' and ANCIRC's other patent applications have
been properly prepared and filed on behalf of the Company,
its Subsidiaries and ANCIRC; except as set forth in the
Prospectus, each of the patents issued therefrom and the
applications are held by the Company, its Subsidiaries and
ANCIRC and to the best of such counsel's knowledge, no other
entity or individual has any right or claim in any of the
Company's, its Subsidiaries' and ANCIRC's patents, patent
applications or any patent to be issued therefrom by virtue
of any contract, license or other agreement known to such
counsel, such counsel has no knowledge that the Company, its
Subsidiaries and ANCIRC lacks or will be unable to obtain
any rights or licenses to use all patents, patent rights and
Intangibles necessary to conduct the business now or
proposed to be conducted by the Company, its Subsidiaries
and ANCIRC, as the case may be, as described in the
Prospectus, and such counsel is unaware of any facts which
form a basis for a finding of unenforceability or invalidity
of any of the patents, patent rights or other Intangibles
owned by licensed to or used by the Company, its
Subsidiaries and ANCIRC, as the case may be;
(iii) To the best of such counsel's knowledge, the
Company, its Subsidiaries and ANCIRC owns or possesses
sufficient or adequate rights to use all material patents
necessary for the conduct of its business as described in
the Prospectus;
(iv) Except as set forth in the Prospectus, to the
best of such counsel's knowledge, (A) the Company, its
Subsidiaries and ANCIRC has conducted its business without
infringement of any patents, patent rights or other
Intangibles of others and (B) the Company, its Subsidiaries
and ANCIRC has not received any notice of any claim of
infringement or violation of or conflict with rights or
claims of others with respect to any patents, patent rights
or other Intangibles owned by, licensed to or used by the
Company, its Subsidiaries and ANCIRC; and such counsel is
not aware of any research or licensing agreements, royalty
arrangements, patents, patent rights or Intellectual
Property of others which are infringed by the Company's, its
Subsidiaries' and ANCIRC products or processes;
(v) Except as set forth in the Prospectus, to the
best of such counsel's knowledge, there is not pending or
threatened any action, suit or proceeding to which the
Company, its Subsidiaries or ANCIRC is a party, before or by
any court or governmental agency or body, relating to
patents or patent rights or patent applications;
-27-
(vi) Nothing has come to the attention of such
counsel which leads such counsel to believe that any of the
claims in U.S. Patent Nos. , which are owned by the Company,
are invalid over any issued patents known to such counsel;
(vii) The Company, the Subsidiaries and ANCIRC are
listed in the records of the United States Patent and
Trademark Office as the holder of record of each of the
patents listed opposite its name on Schedule D attached
----------
hereto (the "Patents") and each of the patent applications
-------
listed on such Schedule D (the "Applications") and to such
------------
counsel's knowledge, the Company, the Subsidiaries and
ANCIRC, are listed in the records of the appropriate foreign
office as the sole holder of record of each of the foreign
Patents and foreign Applications listed on said Schedule D
under such person's name. Such counsel knows of no claims of
third parties to any ownership interest or lien with respect
to any of the Patents or Applications. To such counsel's
knowledge, none of the Applications has been rejected;
(viii) Nothing has come to the attention of such
counsel that would lead such counsel to believe that any of
the representations and warranties of the Company contained
in Section 3(r) of this Agreement are not true and correct;
and
(ix) Such counsel have reviewed the Registration
Statement and Prospectus, and any further amendments or
supplements thereto made by the Company prior to the Closing
Date, and insofar as they concern patents or patent rights,
or other Intangibles or patent applications, such counsel
have no reason to believe that either any part of the
Registration Statement, when such part 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 misleading or
that the Prospectus and any amendment or supplement thereto,
as of the date thereof, on the date of filing thereof with
the Commission, and at the Closing Date, included an untrue
statement of a material fact or omitted to state a material
fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not
misleading.
(e) You shall have received from Xxxxxx Xxxxxxxx LLP letters dated,
respectively, the date of this Agreement and the time of purchase and additional
time of purchase, as the case may be, and addressed to the Underwriters (with
reproduced copies for each of the Underwriters) in the forms approved by BOA and
Bear Xxxxxxx, containing statements and information of the type ordinarily
included in accountant's "comfort letters" to underwriters, delivered according
to Statement of Auditing Standards No. 72 (or any successor bulletin), with
respect to the audited and unaudited financial statements and certain financial
information contained in the Registration Statement and the Prospectus (and the
Representative shall have received additional conformed copies of such
accountants' letter for each of the several Underwriters).
(f) You shall have received at the time of purchase and at the
additional time of purchase, as the case may be, the favorable opinion of Xxxxxx
Xxxxxx & Xxxxxxx, counsel for the Un-
-28-
derwriters, dated the time of purchase or the additional time of purchase, as
the case may be, in form and substance satisfactory to the Underwriters.
In addition, such counsel shall state that such counsel has
participated in conferences with officers and other representatives of
the Company, counsel for the Company, representatives of the
independent public accountants of the Company and representatives of
the Underwriters at which the contents of the Registration Statement
and Prospectus and related matters were discussed and, although such
counsel is not passing upon and does not assume any responsibility for
the accuracy, completeness or fairness of the statements contained in
the Registration Statement and Prospectus, on the basis of the
foregoing (relying as to materiality to a large extent upon the
opinions of officers and other representatives of the Company), no
facts have come to the attention of such counsel which lead them to
believe that the Registration Statement or any amendment thereto at
the time such 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 misleading or that the Prospectus as of its
date or any supplement thereto as of its 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, in light of the circumstances under which they were made, not
misleading (it being understood that such counsel need express no
comment with respect to the financial statements and schedules and
other financial and statistical data included in the Registration
Statement or Prospectus).
(g) No amendment or supplement to the Registration Statement or
Prospectus, including documents deemed to be incorporated by reference therein,
shall be filed prior to the time the Registration Statement becomes effective to
which you object in writing.
(h) The Prospectus shall have been filed with the Commission pursuant
to Rule 424(b) under the Act, at or before 5:00 P.M., New York City time, on the
date of this Agreement, unless a later time (but not later than 5:00 P.M., New
York City time, on the second full business day after the date of this
Agreement) shall be agreed to by the Company, the Representatives of the Selling
Stockholders and you in writing or by telephone, confirmed in writing; provided,
however, that the Company, the Representatives of the Selling Stockholders and
you and any group of Underwriters, including you, who have agreed hereunder to
purchase in the aggregate at least 50% of the Firm Shares may from time to time
agree on a later date.
(i) Prior to the time of purchase or the additional time of purchase,
as the case may be, (i) no stop order with respect to the effectiveness of the
Registration Statement shall have been issued under the Act or proceedings
initiated or threatened under Section 8(d) or 8(e) of the Act; (ii) the
Registration Statement and all amendments thereto, or modifications thereof, if
any, shall 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 not misleading; and (iii) the Prospectus and all amendments or
supplements thereto, or modifications thereof, if any, shall 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.
-29-
(j) Between the time of execution of this Agreement and the time of
purchase or the additional time of purchase, as the case may be, (i) no material
and unfavorable change, financial or otherwise (other than as referred to in the
Registration Statement and Prospectus), in the business, condition or prospects
of the Company, its Subsidiaries and ANCIRC taken as a whole shall occur or
become known and (ii) no transaction which is material and unfavorable to the
Company shall have been entered into by the Company, any of its Subsidiaries or
ANCIRC.
(k) The Company will, at the time of purchase or additional time of
purchase, as the case may be, deliver to you a certificate of two of its
executive officers to the effect that the representations and warranties of the
Company as set forth in this Agreement are true and correct as of each such
date, that the Company shall perform such of its obligations under this
Agreement as are to be performed at or before the time of purchase and at or
before the additional time of purchase, as the case may be, and the conditions
set forth in paragraphs (i) and (j) of this Section 8 have been met.
(l) You shall have received signed letters, dated the date of this
Agreement, from each of the directors and officers of the Company and the
Management Selling Stockholders to the effect that such persons shall not sell,
offer or agree to sell, contract to sell, grant any option to purchase or
otherwise dispose of, directly or indirectly, any shares of Common Stock of the
Company or securities convertible into or exchangeable or exercisable for Common
Stock or warrants or other rights to purchase Common Stock for a period of 90
days after the date of the Prospectus without BOA's and Bear Xxxxxxx' prior
written consent.
(m) The Shares shall have been approved for inclusion on NASDAQ,
subject only to notice of issuance at or prior to the time of purchase or the
additional time of purchase, as the case may be.
(n) The Company and the Selling Stockholders shall have furnished to
you such other documents and certificates as to the accuracy and completeness of
any statement in the Registration Statement and the Prospectus as of the time of
purchase and the additional time of purchase, as the case may be, as you may
reasonably request.
(o) The Selling Stockholders will at the time of purchase and the
additional time of purchase, as the case may be, deliver to you a certificate of
the Representatives of the Selling Stockholders to the effect that the
representations and the warranties of the Selling Stockholders as set forth in
this Agreement are true and correct as of each such date.
(p) Between the time of execution of this Agreement and the time of
purchase or the additional time of purchase, as the case may be, there shall not
have occurred any downgrading, nor shall any notice or announcement have been
given or made of (i) any intended or potential downgrading or (ii) any review or
possible change that does not indicate an improvement, in the rating accorded
any securities of or guaranteed by the Company or any Subsidiary by any
"nationally recognized statistical rating organization," as that term is defined
in Rule 436(g)(2) under the Act.
9. Effective Date of Agreement; Termination. This Agreement shall
----------------------------------------
become effective (i) if Rule 430A under the Act is not used, when you shall have
received notification of the ef-
-30-
fectiveness of the Registration Statement, or (ii) if Rule 430A under the Act is
used, when the parties hereto have executed and delivered this Agreement.
The obligations of the several Underwriters hereunder shall be subject
to termination in the absolute discretion of you or any group of Underwriters
(which may include you) which has agreed to purchase in the aggregate at least
50% of the Firm Shares, if, since the time of execution of this Agreement or the
respective dates as of which information is given in the Registration Statement
and Prospectus, (y) there has been any material adverse and unfavorable change,
financial or otherwise (other than as referred to in the Registration Statement
and Prospectus), in the operations, business, condition or prospects of the
Company and its Subsidiaries taken as a whole, which would, in your judgment or
in the judgment of such group of Underwriters, make it impracticable to market
the Shares, or (z) there shall have occurred any downgrading, or any notice
shall have been given of (i) any intended or potential downgrading or (ii) any
review or possible change that does not indicate an improvement, in the rating
accorded any securities of or guaranteed by the Company or any Subsidiary by any
"nationally recognized statistical rating organization," as that term is defined
in Rule 436(g)(2) under the Act or, if, at any time prior to the time of
purchase or, with respect to the purchase of any Additional Shares, the
additional time of purchase, as the case may be, trading in securities on the
New York Stock Exchange, the American Stock Exchange or the NASDAQ shall have
been suspended or limitations or minimum prices shall have been established on
the New York Stock Exchange, the American Stock Exchange or the NASDAQ, or if a
banking moratorium shall have been declared either by the United States or New
York State authorities, or if the United States shall have declared war in
accordance with its constitutional processes or there shall have occurred any
material outbreak or escalation of hostilities or other national or
international calamity or crisis of such magnitude in its effect on the
financial markets of the United States as, in your judgment or in the judgment
of such group of Underwriters, to make it impracticable to market the Shares.
If you or any group of Underwriters elects to terminate this Agreement
as provided in this Section 9, the Company, the Representatives of the Selling
Stockholders and each other Underwriter shall be notified promptly by letter or
telegram.
If the sale to the Underwriters of the Shares, as contemplated by this
Agreement, is not carried out by the Underwriters for any reason permitted under
this Agreement or if such sale is not carried out because the Company or the
Selling Stockholders, as the case may be, shall be unable to comply with any of
the terms of this Agreement, the Company or the Selling Stockholders, as the
case may be, shall not be under any obligation or liability under this Agreement
(except to the extent provided in Sections 6(a), 7 and 11 hereof), and the
Underwriters shall be under no obligation or liability to the Company and the
Selling Stockholders under this Agreement (except to the extent provided in
Section 11 hereof) or to one another hereunder.
10. Default by Underwriters and by Selling Stockholders. (a) Subject
---------------------------------------------------
to Sections 8 and 9, if any Underwriter shall default in its obligation to take
up and pay for the Firm Shares to be purchased by it hereunder (otherwise than
for reasons sufficient to justify the termination of this Agreement under the
provisions of Section 9 hereof) and if the aggregate number of Firm Shares which
all Underwriters so defaulting shall have agreed but failed to take up and pay
for does not exceed 10% of
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the total number of Firm Shares, the non-defaulting Underwriters shall take up
and pay for (in addition to the number of Firm Shares they are obligated to
purchase pursuant to Section 1 hereof) the number of Firm Shares agreed to be
purchased by all such defaulting Underwriters, as hereinafter provided. Such
Shares shall be taken up and paid for by such non- defaulting Underwriter or
Underwriters in such amount or amounts as you may designate with the consent of
each Underwriter so designated or, in the event no such aggregate designation is
made, such Shares shall be taken up and paid for by all non-defaulting
Underwriters pro rata in proportion to the aggregate number of Firm Shares set
opposite the names of such non-defaulting Underwriters in Schedule A.
Without relieving any defaulting Underwriter from its obligations
hereunder, the Company and the Selling Stockholders agree with the non-
defaulting Underwriters that they will not sell any Firm Shares hereunder unless
all of the Firm Shares are purchased by the Underwriters (or by substituted
Underwriters selected by you with the approval of the Company or selected by the
Company with your approval).
If a new Underwriter or Underwriters are substituted by the
Underwriters or by the Company for a defaulting Underwriter or Underwriters in
accordance with the foregoing provision, the Company or you shall have the right
to postpone the time of purchase for a period not exceeding five business days
in order that any necessary changes in the Registration Statement and Prospectus
and other documents may be effected.
The term Underwriter as used in this Agreement shall refer to and
include any Underwriter substituted under this Section 10 with like effect as if
such substituted Underwriter had originally been named in Schedule A.
If the aggregate number of Shares which the defaulting Underwriter or
Underwriters agreed to purchase exceeds 10% of the total number of Shares which
all Underwriters agreed to purchase hereunder, and if neither the non-defaulting
Underwriters nor the Company shall make arrangements within the five business
day period stated above for the purchase of all the Shares which the defaulting
Underwriter or Underwriters agreed to purchase hereunder, this Agreement shall
be terminated without further act or deed and without any liability on the part
of the Company to any non-defaulting Underwriter and without any liability on
the part of any non-defaulting Underwriter to the Company. Nothing in this
paragraph, and no action taken hereunder, shall relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
(b) If one or more of the Selling Stockholders shall fail to sell and
deliver to the Underwriters the Firm Shares to be sold and delivered by such
Selling Stockholders at the time of purchase pursuant to this Agreement, then
the Underwriters may at their option, by written notice from BOA and Bear
Xxxxxxx to the Company and the Selling Stockholders, either (i) terminate this
Agreement without any liability on the part of any Underwriter or, except as
provided in Sections 6(a), 7 and 11 hereof, the Company or the Selling
Stockholders, or (ii) purchase the shares which the Company and the other
Selling Stockholders have agreed to sell and deliver in accordance with the
terms hereof. If one or more of the Selling Stockholders shall fail to sell and
deliver to the Underwriters the Shares to be sold and delivered by such Selling
Stockholders pursuant to this Agreement at the time of purchase or the
addi-
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tional time of purchase, then the Underwriters shall have the right, by written
notice from BOA and Bear Xxxxxxx to the Company and the Selling Stockholders, to
postpone the time of purchase or the additional time of purchase, as the case
may be, but in no event for longer than seven days in order that the required
changes, if any, to the Registration Statement and the Prospectus or other
documents or arrangements may be effected.
11. Indemnity and Contribution. (a) The Company and the Selling
--------------------------
Stockholders jointly and severally agree to indemnify, defend and hold harmless
each Underwriter, its partners, directors and officers, and any person who
controls any Underwriter within the meaning of Section 15 of the Act or Section
20 of the Exchange Act, and such person's partners, directors and officers and
the successors and assigns of all of the foregoing persons from and against any
loss, damage, expense, liability or claim (including the reasonable cost of
investigation) which, jointly or severally, any such Underwriter or any such
person may incur under the Act, the Exchange Act, the common law or otherwise,
insofar as such loss, damage, expense, liability or claim arises out of or is
based upon any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement (or in the Registration Statement as
amended by any post-effective amendment thereof by the Company) or in a
Prospectus (the term "Prospectus" for the purpose of this Section 11 being
deemed to include any Preliminary Prospectus, the Prospectus and the Prospectus
as amended or supplemented by the Company), or arises out of or is based upon
any omission or alleged omission to state a material fact required to be stated
in either such Registration Statement or Prospectus or necessary to make the
statements made therein not misleading, except insofar as any such loss, damage,
expense, liability or claim arises out of or is based upon any untrue statement
or alleged untrue statement of a material fact contained in and in conformity
with information furnished in writing by or on behalf of any Underwriter through
you to the Company expressly for use with reference to such Underwriter in such
Registration Statement or such Prospectus or arises out of or is based upon any
omission or alleged omission to state a material fact in connection with such
information required to be stated in such Registration Statement or Prospectus
or necessary to make such information not misleading; provided, however, that no
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Selling Stockholder shall be responsible, either pursuant to this indemnity or
as a result of any breach of this Agreement, for losses, expenses, liability or
claims arising out of or based upon such untrue statement or omission or
allegation thereof based upon information furnished by any party other than such
Selling Stockholder and, in any event, no Selling Stockholder shall be
responsible, either pursuant to this indemnity or as a result of any breach of
this Agreement, for losses, expenses, liability or claims for an amount in
excess of the proceeds to be received by such Selling Stockholder (before
deducting expenses) from the sale of Shares hereunder.
If any claim, suit, action, proceeding, investigation or inquiry
(together, a "Proceeding") is brought against an Underwriter or any such person
----------
in respect of which indemnity may be sought against the Company or any Selling
Stockholder pursuant to the foregoing paragraph, such Underwriter or such person
shall promptly notify the Company and the Representatives of the Selling
Stockholders in writing of the institution of such Proceeding and the Company or
such Selling Stockholder, as the case may be, shall assume the defense of such
Proceeding, including the employment of counsel reasonably satisfactory to such
indemnified party and payment of all fees and expenses; provided, however, that
-------- -------
the omission to so notify the Company or the Representative of the Selling
Stockholders shall not relieve the Company or any Selling Stockholder from any
liability which the Company may have to any
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Underwriter or any such person or otherwise. Such Underwriter or such person
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
Underwriter or of such person unless the employment of such counsel shall have
been authorized in writing by the Company or such Selling Stockholder in
connection with the defense of such Proceeding or the Company or such Selling
Stockholder shall not have, within a reasonable period of time in light of the
circumstances, employed counsel to have charge of the defense of such Proceeding
or such indemnified party or parties shall have reasonably concluded that there
may be defenses available to it or them which are different from, additional to
or in conflict with those available to the Company or such Selling Stockholder
(in which case the Company or such Selling Stockholder shall not have the right
to direct the defense of such Proceeding on behalf of the indemnified party or
parties), in any of which events such fees and expenses shall be borne by the
Company or such Selling Stockholder, as the case may be, and paid as incurred
(it being understood, however, that the Company or such Selling Stockholder
shall not be liable for the expenses of more than one separate counsel (in
addition to any local counsel) in any one Proceeding or series of related
Proceedings in the same jurisdiction representing the indemnified parties who
are parties to such Proceeding). The Company or such Selling Stockholder shall
not be liable for any settlement of any such Proceeding effected without its
written consent, but if settled with the written consent of the Company or such
Selling Stockholder, the Company or such Selling Stockholder agrees to indemnify
and hold harmless any Underwriter and any such person from and against any loss
or liability by reason of such settlement. Notwithstanding the foregoing
sentence, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel as contemplated by the second sentence of this paragraph, then the
indemnifying party agrees that it shall be liable for any settlement of any
Proceeding effected without its written consent if (i) such settlement is
entered into more than 60 business days after receipt by such indemnifying party
of the aforesaid request, (ii) such indemnifying party shall not have reimbursed
the indemnified party in accordance with such request prior to the date of such
settlement and (iii) such indemnified party shall have given the indemnifying
party at least 30 days' prior notice of its intention to settle. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened Proceeding 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 on claims
that are the subject matter of such Proceeding and does not include an admission
of fault, culpability or a failure to act, by or on behalf of such indemnified
party.
(b) Each Underwriter severally and not jointly agrees to indemnify,
defend and hold harmless the Company, its directors and officers, each Selling
Stockholder and any person who controls the Company or any Selling Stockholder
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act,
and each such person's directors and officers from and against any loss, damage,
expense, liability or claim (including the reasonable cost of investigation)
which, jointly or severally, the Company, any Selling Stockholder or any such
person may incur under the Act, the Exchange Act or common law or otherwise,
insofar as such loss, damage, expense, liability or claim arises out of or is
based upon any untrue statement or alleged untrue statement of a material fact
contained in and in conformity with information furnished in writing by or on
behalf of such Underwriter through you to the Company expressly for use with
reference to such Underwriter in the Registration Statement (or in the
Registration Statement as amended by any post-effective amendment thereof by the
Company) or in a
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Prospectus, or arises out of or is based upon any omission or alleged omission
to state a material fact in connection with such information required to be
stated in such Registration Statement or such Prospectus or necessary to make
such information not misleading.
If any Proceeding is brought against the Company, any Selling
Stockholder or any such person in respect of which indemnity may be sought
against any Underwriter pursuant to the foregoing paragraph, the Company, such
Selling Stockholder or such person shall promptly notify such Underwriter in
writing of the institution of such Proceeding and such Underwriter shall assume
the defense of such Proceeding, including the employment of counsel reasonably
satisfactory to such indemnified party and payment of all fees and expenses;
provided, however, that the omission to so notify such Underwriter shall not
-------- -------
relieve such Underwriter from any liability which such Underwriter may have to
the Company, any Selling Stockholder or any such person or otherwise. The
Company, such Selling Stockholder or such person shall have the right to employ
its own counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of the Company, such Selling Stockholder or such person
unless the employment of such counsel shall have been authorized in writing by
such Underwriter in connection with the defense of such Proceeding or such
Underwriter shall not have, within a reasonable period of time in light of the
circumstances, employed counsel to have charge of the defense of such Proceeding
or 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 or in conflict with those available to such Underwriter (in which case such
Underwriter shall not have the right to direct the defense of such Proceeding on
behalf of the indemnified party or parties, but such Underwriter may employ
counsel and participate in the defense thereof but the fees and expenses of such
counsel shall be at the expense of such Underwriter), in any of which events
such fees and expenses shall be borne by such Underwriter and paid as incurred
(it being understood, however, that such Underwriter shall not be liable for the
expenses of more than one separate counsel (in addition to any local counsel) in
any one Proceeding or series of related Proceedings in the same jurisdiction
representing the indemnified parties who are parties to such Proceeding). No
Underwriter shall be liable for any settlement of any such Proceeding effected
without the written consent of such Underwriter, but if settled with the written
consent of such Underwriter, such Underwriter agrees to indemnify and hold
harmless the Company, any Selling Stockholder and any such person from and
against any loss or liability by reason of such settlement. Notwithstanding the
foregoing sentence, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel as contemplated by the second sentence of this paragraph, then the
indemnifying party agrees that it shall be liable for any settlement of any
Proceeding effected without its written consent if (i) such settlement is
entered into more than 60 business days after receipt by such indemnifying party
of the aforesaid request, (ii) such indemnifying party shall not have reimbursed
the indemnified party in accordance with such request prior to the date of such
settlement and (iii) such indemnified party shall have given the indemnifying
party at least 30 days' prior notice of its intention to settle. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened Proceeding 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 (x) includes
an unconditional release of such indemnified party from all liability on claims
that are the subject matter of such Proceeding and (y) does not include a
statement as to or an admission of fault, culpability or a failure to act, by or
on behalf of the indemnified party.
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(c) If the indemnification provided for in this Section 11 is
unavailable to an indemnified party under subsections (a) and (b) of this
Section 11 or insufficient to hold an indemnified party harmless in respect of
any losses, damages, expenses, liabilities or claims referred to therein, then
each applicable indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such indemnified party
as a result of such losses, damages, expenses, liabilities or claims (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Selling Stockholders on the one hand and the Underwriters on the
other hand from the offering of the Shares 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 Stockholders on
the one hand and of the Underwriters on the other in connection with the
statements or omissions which resulted in such losses, damages, expenses,
liabilities or claims, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Selling Stockholders on
the one hand and the Underwriters on the other shall be deemed to be in the same
respective proportions as the total proceeds from the offering (net of
underwriting discounts and commissions but before deducting expenses) received
by the Company and the Selling Stockholders and the total underwriting discounts
and commissions received by the Underwriters bear to the aggregate public
offering price of the Shares. The relative fault of the Company and the Selling
Stockholders on the one hand and of the Underwriters on the other shall be
determined by reference to, among other things, whether the untrue statement or
alleged untrue statement of a material fact or omission or alleged omission
relates to information supplied by the Company, by the Selling Stockholders or
by the Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses, damages,
expenses, liabilities and claims referred to in this subsection shall be deemed
to include any legal or other fees or expenses reasonably incurred by such party
in connection with investigating, preparing to defend or defending any
Proceeding.
(d) The Company, the Selling Stockholders and the Underwriters agree
that it would not be just and equitable if contribution pursuant to this Section
11 were determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation that does
not take account of the equitable considerations referred to in subsection (c)
above. Notwithstanding the provisions of this Section 11, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by such Underwriter and distributed to
the public were offered to the public exceeds the amount of any damage which
such Underwriter has otherwise been required to pay by reason of such untrue
statement 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 to contribute
pursuant to this Section 11 are several in proportion to their respective
underwriting commitments and not joint.
(e) The indemnity and contribution agreements contained in this
Section 11 and the covenants, warranties and representations of the Company and
the Selling Stockholders contained in this Agreement shall remain in full force
and effect regardless of any investigation made by or on behalf of any
Underwriter, its partners, directors or officers or any person (including each
partner, officer or
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director of such person) who controls any Underwriter within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, or by or on behalf of
the Company, its directors or officers, any Selling Stockholder or any person
who controls the Company within the meaning of Section 15 of the Act or Section
20 of the Exchange Act, and shall survive any termination of this Agreement or
the issuance and delivery of the Shares. The Company, each Selling Stockholder
and each Underwriter agree promptly to notify each other of the commencement of
any Proceeding against it and, in the case of the Company, against any of the
Company's officers or directors in connection with the issuance and sale of the
Shares, or in connection with the Registration Statement or Prospectus.
12. Notices. Except as otherwise herein provided, all statements,
-------
requests, notices and agreements shall be in writing or by telegram and, if to
the Underwriters, shall be sufficient in all respects if delivered or sent to
Bank of America Securities LLC, 0 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000,
Attention: Syndicate Department and, if to the Company, shall be sufficient in
all respects if delivered or sent to the Company at the offices of the Company
at 0000 Xxxxxxxxx 00xx Xxxxxx, Xxxx Xxxxxxxxxx, Xxxxxxx 00000, Attention: Xxxxx
Xxxxx, Esq., and, if to any of the Selling Stockholders, shall be sufficient in
all respects if delivered or sent to the Representatives of the Selling
Stockholders at , Attention: .
13. Governing Law; Construction. This Agreement and any claim,
---------------------------
counterclaim or dispute of any kind or nature whatsoever arising out of or in
any way relating to this Agreement ("Claim"), directly or indirectly, shall be
-----
governed by, and construed in accordance with, the laws of the State of New
York, without regard to principles of conflicts of law thereof. The Section
headings in this Agreement have been inserted as a matter of convenience of
reference and are not a part of this Agreement.
14. Submission to Jurisdiction. Except as set forth below, no Claim
--------------------------
may be commenced, prosecuted or continued in any court other than the courts of
the State of New York located in the City and County of New York or in the
United States District Court for the Southern District of New York, which courts
shall have jurisdiction over the adjudication of such matters, and the Company
consents to the jurisdiction of such courts and personal service with respect
thereto. The Company hereby consents to personal jurisdiction, service and venue
in any court in which any Claim is brought by any third party against BOA, Bear
Xxxxxxx or any indemnified party. Each of BOA, Bear Xxxxxxx and the Company (on
its behalf and, to the extent permitted by applicable law, on behalf of its
stockholders and affiliates) waives all right to trial by jury in any Claim
(whether based upon contract, tort or otherwise). The Company agrees that a
final judgment in any such Claim brought in any such court shall be conclusive
and binding upon the Company and may be enforced in any other courts to the
jurisdiction of which the Company is or may be subject, by suit upon such
judgment.
15. Parties at Interest. The Agreement herein set forth has been and
-------------------
is made solely for the benefit of the Underwriters, the Company, the Selling
Stockholders and, to the extent provided in Section 11 hereof, the controlling
persons, directors and officers referred to in such section, and their
respective successors, assigns, heirs, personal representatives and executors
and administrators. No other person, partnership, association or corporation
(including a purchaser, as such purchaser, from any of the Underwriters) shall
acquire or have any right under or by virtue of this Agreement.
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16. General Provisions. This Agreement constitutes the entire
------------------
agreement of the parties to this Agreement and supersedes all prior written or
oral and all contemporaneous oral agreements, undertakings and negotiations with
respect to the subject matter hereof. This Agreement may be executed in two or
more counterparts, each one of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument. This
Agreement may not be amended or modified unless in writing by all of the parties
hereto, and no condition herein (express or implied) may be waived unless waived
in writing by each party whom the condition is meant to benefit. The section
headings herein are for the convenience of the parties only and shall not affect
the construction or interpretation of this Agreement.
Each of the parties hereto acknowledges that it is a sophisticated
business person who was adequately represented by counsel during negotiations
regarding the provisions hereof, including, without limitation, the
indemnification and contribution provisions of Section 11, and is fully informed
regarding said provisions. Each of the parties hereto further acknowledges that
the provisions of Section 11 hereto fairly allocate the risks in light of the
ability of the parties to investigate the Company, its affairs and its business
in order to assure that adequate disclosure has been made in the Registration
Statement, any Preliminary Prospectus and the Prospectus (and any amendments and
supplements thereto), as required by the Act and the Exchange Act.
17. Successors and Assigns. This Agreement shall be binding upon the
----------------------
Underwriters and the Company and their successors and assigns and any successor
or assign of any substantial portion of the Company's and any of the
Underwriters' respective businesses and/or assets.
18. Partial Unenforceability. The invalidity or unenforceability of
------------------------
any Section, paragraph or provision of this Agreement shall not affect the
validity or enforceability of any other Section, paragraph or provision hereof.
If any Section, paragraph or provision of this Agreement is for any reason
determined to be invalid or unenforceable, there shall be deemed to be made such
minor changes (and only such minor changes) as are necessary to make it valid
and enforceable.
[SIGNATURE PAGES FOLLOW]
