Exhibit 1.1
9,000,000 Shares
Guidant Corporation
Common Stock
UNDERWRITING AGREEMENT
October , 1996
October , 1996
Xxxxxx Xxxxxxx & Co. Incorporated
Alex. Xxxxx & Sons Incorporated
Xxxxx & Company
X.X. Xxxxxx Securities Inc.
Xxxxx Xxxxxxx Inc.
c/o Morgan Xxxxxxx & Co.
Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxxx & Co. International Limited
Alex. Xxxxx & Sons Incorporated
Xxxxx & Company
X.X. Xxxxxx Securities Ltd.
Xxxxx Xxxxxxx Inc.
x/x Xxxxxx Xxxxxxx & Xx. Xxxxxxxxxxxxx Limited
00 Xxxxx Xxxxxx
Xxxxxx Xxxxx
Xxxxxx X00 0XX
England
Dear Sirs:
Guidant Corporation, an Indiana corporation (the "Company"), proposes
to issue and sell to the several Underwriters (as defined below) 9,000,000
shares of its common stock (the "Firm Shares").
-----------
It is understood that, subject to the conditions hereinafter stated,
7,200,000 Firm Shares (the "U.S. Firm Shares") will be sold to the several U.S.
----------------
Underwriters named in Schedule I hereto (the "U.S. Underwriters") in connection
-----------------
with the offering and sale of such U.S. Firm Shares in the United States and
Canada to United States and Canadian Persons (as such terms are defined in the
Agreement Between U.S. and International Underwriters of even date herewith),
and 1,800,000 Firm Shares (the "International Shares") will be sold to the
--------------------
several International Underwriters named in Schedule II hereto (the
"International Underwriters") in connection with the offering and sale of such
---------------------------
International Shares outside the United States and Canada to persons other
than United States and Canadian Persons. Xxxxxx Xxxxxxx & Co. Incorporated,
Alex. Xxxxx & Sons Incorporated, Xxxxx & Company, X.X. Xxxxxx Securities Inc.
and Xxxxx Xxxxxxx Inc. shall act as representatives (the "U.S. Representatives")
--------------------
of the several U.S. Underwriters, and Xxxxxx Xxxxxxx & Co. International
Limited, Alex. Xxxxx & Sons Incorporated, Xxxxx & Company, X.X. Xxxxxx
Securities Ltd. and Xxxxx Xxxxxxx Inc. shall act as representatives (the
"International Representatives") of the several International Underwriters. The
------------------------------
U.S. Underwriters and the International Underwriters are hereinafter
collectively referred to as the "Underwriters."
------------
The Company also proposes to sell to the several U.S. Underwriters not
more than an additional 1,350,000 shares of its common stock (the "Additional
----------
Shares"), if and to the extent that the U.S. Representatives shall have
------
determined to exercise, on behalf of the U.S. Underwriters, the right to
purchase such shares of common stock granted to the U.S. Underwriters in Article
II hereof. The Firm Shares and the Additional Shares are hereinafter
collectively referred to as the "Shares." The shares of common stock of the
------
Company to be outstanding after giving effect to the sales contemplated hereby
are hereinafter referred to as the "Common Stock."
------------
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement relating to the Shares. The registration
----------
statement contains two prospectuses to be used in connection with the offering
and sale of the Shares: the U.S. prospectus to be used in connection with the
offering and sale of Shares in the United States and Canada to United States and
Canadian Persons, and the international prospectus to be used in connection with
the offering and sale of Shares outside the United States and Canada to persons
other than United States and Canadian Persons. The international prospectus is
identical to the U.S. prospectus except for the outside front cover page. The
registration statement as amended at the time it becomes effective, including
the information (if any) deemed to be part of the registration statement at the
time of effectiveness pursuant to Rule 430A under the Securities Act of 1933, as
amended (the "Securities Act"), is hereinafter referred to as the "Registration
-------------- ------------
Statement;" the U.S. prospectus and the international prospectus in the
---------
respective forms first used to confirm sales of Shares
2
are hereinafter collectively referred to as the "Prospectus" (including in the
----------
case of all references to the Registration Statement and the Prospectus
documents incorporated therein by reference). If the Company has filed an
abbreviated registration statement to register additional shares of Common Stock
pursuant to Rule 462(b) under the Securities Act (the "Rule 462 Registration
---------------------
Statement"), then any reference herein to the term "Registration Statement"
---------
shall be deemed to include such Rule 462 Registration Statement.
I.
The Company represents and warrants to each of the Underwriters that:
(a) The Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before, or to the best of the Company's
knowledge, threatened by the Commission.
(b) (i) Each document, if any, filed or to be filed pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
------------
incorporated by reference in the Prospectus complied, or will comply when so
filed, in all material respects with the Exchange Act and the applicable rules
and regulations of the Commission thereunder; (ii) each part of the Registration
Statement, when such part became effective, did not contain, and each such part,
as amended or supplemented, if applicable, will not contain, any 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; (iii)
the Registration Statement and the Prospectus comply, and, as amended or
supplemented, if applicable, will comply, in all material respects with the
Securities Act and the applicable rules and regulations of the Commission
thereunder; and (iv) the Prospectus does not contain, and, as amended or
supplemented, if applicable, will not contain, any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth in this
paragraph I(b) do not apply to statements or omissions in the Registration
Statement or the Prospectus
3
based upon information relating to any Underwriter furnished to the Company in
writing by such Underwriter through you expressly for use therein.
(c) The Company has been duly incorporated, is validly existing as a
corporation under the laws of Indiana, with full corporate power and authority
to own its property and to conduct its business as described in the Prospectus
and is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a material adverse effect
on the Company and its subsidiaries, taken as a whole.
(d) Each subsidiary of the Company listed on Annex A hereto has been
duly incorporated, 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 its property and to conduct its business as described in the
Prospectus and is duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole. Annex A
attached hereto lists all material subsidiaries (the "Material Subsidiaries") of
the Company (including, without limitation, all significant subsidiaries (as
defined in Regulation S-X of the Commission) of the Company).
(e) The outstanding shares of capital stock of each Material
Subsidiary of the Company have been duly authorized and validly issued, are
fully paid and nonassessable and are owned either directly or indirectly (except
for directors' qualifying shares) by the Company free and clear of all liens,
encumbrances and perfected (or, to the best of the Company's knowledge,
unperfected) security interests, and no options, warrants or rights to purchase,
agreements or other obligations to issue or other rights to convert any
obligations into shares of capital stock or ownership interests in any Material
Subsidiary of the Company are outstanding.
4
(f) The authorized capital stock of the Company conforms as to legal
matters in all material respects to the description thereof contained in the
Prospectus.
(g) The shares of Common Stock outstanding prior to the issuance of
the Shares have been duly authorized and are validly issued, fully paid and non-
assessable, and there are no outstanding options, warrants or other rights
granted by the Company to purchase shares of Common Stock or other securities of
the Company, except as described in the Prospectus and except for stock options
and performance awards granted to employees pursuant to the Guidant Corporation
1994 Stock Plan and stock options granted to directors pursuant to the Guidant
Corporation 1996 Non-employee Directors Stock Plan.
(h) The Shares have been duly authorized and, when issued and
delivered in accordance with the terms of this Agreement, will be validly
issued, fully paid and non-assessable, and the issuance of such Shares will not
be subject to any preemptive or similar rights.
(i) This Agreement has been duly authorized, executed and delivered
by the Company.
(j) The Sublicense Agreement, dated October 18, 1994, between Xxx
Xxxxx and Company and Cardiac Pacemakers, Inc. ("CPI"), a subsidiary of the
---
Company (the "Sublicense Agreement"), has not been amended or modified since its
--------------------
execution and remains in full force and effect.
(k) Neither the Company nor any of its Material Subsidiaries is in
violation of its certificate of incorporation or by-laws or in default in the
performance or observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, loan agreement, note, lease or
other agreement or instrument binding upon the Company or any of its
subsidiaries, other than any such violation or default that would not have a
material adverse effect on the Company and its subsidiaries, taken as a whole;
and the execution and delivery by the Company of this Agreement and the
consummation of the transactions contemplated hereby have not, and the
performance by the Company of its obligations under this Agreement will not,
contravene, violate, conflict with, result in a breach of, or constitute a de-
5
fault under (i) any provision of applicable law or regulation, (ii) the articles
of incorporation or by-laws of the Company or any Material Subsidiary of the
Company, (iii) any contract, indenture, mortgage, loan agreement, note, lease or
other agreement or instrument binding upon the Company or any of its Material
Subsidiaries, or (iv) any judgment, determination, order or decree of any
governmental body, agency or court having jurisdiction over the Company or any
Material Subsidiary of the Company, except, in the case of clauses (i), (iii)
and (iv) hereof, any such contravention that would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole. No consent,
approval, authorization or order of or qualification with any governmental body
or agency was required for the execution and delivery by the Company of this
Agreement or is required for the performance by the Company of its obligations
under this Agreement, except such as may be required by the securities or Blue
Sky laws of the various states of the United States in connection with the offer
and sale of the Shares.
(l) There has not occurred any material adverse change, or any
development reasonably likely to result in a material adverse change, in the
condition, financial or otherwise, or in the earnings, business or operations of
the Company and its subsidiaries, taken as whole, from that set forth in the
Prospectus (exclusive of any amendments or supplements thereto subsequent to the
date of this Agreement).
(m) There are no legal or governmental actions, suits, proceedings,
claims, or investigations pending or, to the best of the Company's knowledge,
threatened to which the Company or any of its subsidiaries is a party or to
which any of the properties of the Company or any of its subsidiaries is subject
that are required to be described in the Registration Statement or the
Prospectus and are not so described or which would affect the performance by the
Company of its obligations under this Agreement, nor are there any statutes,
regulations, contracts or other documents that are required to be described in
the Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as required.
6
(n) Each of the Company and its Material Subsidiaries has all
necessary consents, authorizations, approvals, orders, certificates and permits
(collectively, "Authorizations") of and from, and has made all declarations and
--------------
filings (collectively, "Filings") with, all federal, state, local and other
-------
governmental authorities, all self-regulatory organizations and all courts and
other tribunals, to own, lease, license and use its properties and assets and to
conduct its business in the manner described in the Prospectus, or required for
the performance by the Company of its obligations under this Agreement, except
to the extent that the failure to obtain an Authorization or to make a Filing
would not have a material adverse effect on the Company and its subsidiaries,
taken as a whole.
(o) Each preliminary prospectus filed as part of any amendment to the
Registration Statement, or filed pursuant to Rule 424 or Rule 462 under the
Securities Act, complied when so filed in all material respects with the
Securities Act and the rules and regulations of the Commission thereunder.
(p) The Company is not 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.
(q) The Company and its Material Subsidiaries (i) are in compliance
in all material respects with any and all applicable foreign, federal, state and
local laws and regulations relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes, pollutants
or contaminants ("Environmental Laws"), (ii) have received all Authorizations
------------------
required of them under applicable Environmental Laws to conduct their respective
businesses and (iii) are in compliance with all terms and conditions of any such
Authorization, except where such noncompliance with Environmental Laws, failure
to receive required Authorizations or failure to comply with the terms and
conditions of such Authorizations would not, singly or in the aggregate, have a
material adverse effect on the Company and its subsidiaries, taken as a whole.
(r) In the ordinary course of its business, the Company reviews the
effect of Environmental Laws on
7
the business, operations and properties of the Company and its subsidiaries, in
the course of which it identifies and evaluates associated costs and liabilities
(including, without limitation, any capital or operating expenditures required
for clean-up, closure of properties or compliance with Environmental Laws or any
permit, license or approval, any related constraints on operating activities and
any potential liabilities to third parties). On the basis of such review, the
Company has reasonably concluded that such associated costs and liabilities
would not, singly or in the aggregate, have a material adverse effect on the
Company and its subsidiaries, taken as a whole.
(s) To the best of the Company's knowledge, the accountants who have
certified or shall certify the financial statements filed with the Commission as
part of the Registration Statement and the Prospectus are independent
accountants as required by the Securities Act. The consolidated financial
statements of the Company and its subsidiaries (together with the related notes
thereto) included in the Registration Statement fairly present in all material
respects the financial position and results of operations of the Company and its
subsidiaries at the respective dates and for the respective periods to which
they apply. Such financial statements have been prepared in accordance with
generally accepted accounting principles consistently applied throughout the
periods involved except as otherwise stated therein.
(t) No holder of any securities of the Company has any rights, not
effectively satisfied or waived, to the registration of securities of the
Company because of the filing of the Registration Statement or the consummation
of the transactions contemplated therein.
(u) To the best of the Company's knowledge, no labor dispute with the
employees of the Company or any of its Material Subsidiaries exists or is
imminent, and the Company is not aware of any existing or imminent labor
disturbance by such employees which is reasonably likely to have a material
adverse effect on the Company and its subsidiaries, taken as a whole.
(v) The Common Stock, including the Shares, has been approved for
listing on the New York Stock
8
Exchange, Inc. and the Pacific Stock Exchange under the symbol "GDT".
(w) Except as disclosed in the Prospectus, the Company and its
subsidiaries own, possess or license the patents, patent rights, licenses,
inventions, copyrights, know-how (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names and other rights or
interests in items of intellectual property as are necessary for the operation
of the business now operated by them (the "patent and proprietary rights");
-----------------------------
except as disclosed in the Prospectus, neither the Company nor any subsidiary
has received notice of any other asserted rights with respect to any of the
patent and proprietary rights which, if determined unfavorably with respect to
the interests of the Company or any subsidiary of the Company, would have a
material adverse effect on the Company and its subsidiaries, taken as a whole;
and neither the Company nor any subsidiary is aware that any person or entity is
infringing or otherwise violating any of the Company's patents, trademarks,
servicemarks or copyrights in a manner that could materially affect the use
thereof by the Company or any of its subsidiaries.
(x) The Company has no knowledge of any impediment to the
enforceability of any of the patents owned by the Company or any of its
subsidiaries that are necessary for the operation of the business now operated
by them or of any materially relevant prior art references not cited during the
prosecution of any of such patents in the U.S. Patent and Trademark Office or
applicable foreign patent office.
(y) The Company has complied with all provisions of Section 517.075,
Florida Statutes (Chapter 92-198, Laws of Florida).
II.
The Company hereby agrees to sell to the several Underwriters and the
Underwriters, upon the basis of the representations and warranties herein
contained, but subject to the conditions hereinafter stated, agree, severally
and not jointly, to purchase from the Company
9
the respective numbers of Firm Shares set forth in Schedules I and II hereto
opposite their names at $____ a share -- the "purchase price."
--------------
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Company agrees to sell
to the U.S. Underwriters the Additional Shares, and the U.S. Underwriters shall
have a one-time right to purchase, severally and not jointly, up to 1,350,000
Additional Shares at the purchase price. Additional Shares may be purchased as
provided in Article IV hereof solely for the purpose of covering over-allotments
made in connection with the offering of the Firm Shares. If any Additional
Shares are to be purchased, each U.S. Underwriter agrees, severally and not
jointly, to purchase the number of Additional Shares (subject to such
adjustments to eliminate fractional shares as the U.S. Representatives may
determine) that bears the same proportion to the total number of Additional
Shares to be purchased as the number of U.S. Firm Shares set forth in Schedule I
hereto opposite the name of such U.S. Underwriter bears to the total number of
U.S. Firm Shares. The Additional Shares to be purchased by the U.S.
Underwriters hereunder and the U.S. Firm Shares are hereinafter collectively
referred to as the "U.S. Shares."
-----------
The Company hereby agrees that, without the prior written consent of
Xxxxxx Xxxxxxx & Co. Incorporated ("Xxxxxx Xxxxxxx"), it will not during the
--------------
period ending 90 days after the date of the initial public offering of the
Shares, (1) offer, pledge, sell, contract to sell, sell any option or contract
to purchase, purchase any option or contract to sell, grant any option, right or
warrant to purchase, or otherwise transfer or dispose of, directly or
indirectly, any shares of Common Stock of the Company or any securities
convertible into or exercisable or exchangeable for such Common Stock (whether
such shares or any such securities are now owned by the Company or are hereafter
acquired), or (2) enter into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences of ownership of
the Common Stock, whether any such transaction described in clause (1) or (2)
above is to be settled by delivery of Common Stock or such other securities, in
cash or otherwise. The foregoing sentence shall not apply to (i) the Shares to
be sold hereunder,
10
(ii) any shares of such Common Stock sold by the Company upon the exercise of an
option or warrant or the conversion of a security outstanding on the date
hereof, and (iii) grants of stock options and restricted stock under the Guidant
Corporation 1994 Stock Plan.
III.
The Company is advised by you that the Underwriters propose to make a
public offering of their respective portions of the Shares as soon after the
Registration Statement and this Agreement have become effective as in your
judgment is advisable. The Company is further advised by you that the Shares
are to be offered to the public initially at U.S. $____ a share (the "public
------
offering price") and to certain dealers selected by you at a price that
--------------
represents a concession not in excess of U.S. $.__ a share under the public
offering price, and that any Underwriter may allow, and such dealers may
reallow, a concession, not in excess of U.S. $.__ a share, to any Underwriter or
to certain other dealers.
Each U.S. Underwriter hereby makes to and with the Company the
representations and agreements of such U.S. Underwriter contained in the fifth
and sixth paragraphs of Article III of the Agreement Between U.S. and
International Underwriters of even date herewith. Each International
Underwriter hereby makes to and with the Company the representations and
agreements of such International Underwriter contained in the eighth, ninth and
tenth paragraphs of Article III of such Agreement.
IV.
Payment for the Firm Shares shall be made by wire transfer or
certified or official bank check or checks payable to the order of the Company
in immediately available funds at the office of Xxxxxx Xxxxxxx & Co.
Incorporated, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx, at 10:00 A.M., local time, on
July , 1996, or at such other time on the same or such other date, not later
than July , 1996, as shall be designated in writing by you. The time and date
of such payment are hereinafter referred to as the "Closing Date."
------------
11
Payment for any Additional Shares shall be made by certified or
official bank check or checks payable to the order of the Company in immediately
available funds at the office of Xxxxxx Xxxxxxx & Co. Incorporated, 0000
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx, at 10:00 A.M., local time, on such date (which may
be the same as the Closing Date but shall in no event be earlier than the
Closing Date nor later than ten business days after the giving of the notice
hereinafter referred to) as shall be designated in a written notice from the
U.S. Representatives to the Company of their determination, on behalf of the
U.S. Underwriters, to purchase a number, specified in said notice, of Additional
Shares, or on such other date, in any event not later than September , 1996, as
shall be designated in writing by the U.S. Representatives. The time and date
of such payment are hereinafter referred to as the "Option Closing Date." The
-------------------
notice of the determination to exercise the option to purchase Additional Shares
and of the Option Closing Date may be given at any time within 30 days after the
date of this Agreement.
Certificates for the Firm Shares and Additional Shares shall be in
definitive form and registered in such names and in such denominations as you
shall request in writing not later than two full business days prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to you on
the Closing Date or the Option Closing Date, as the case may be, for the
respective accounts of the several Underwriters, with any transfer taxes payable
in connection with the transfer of the Shares to the Underwriters duly paid,
against payment of the purchase price therefor.
V.
The obligations of the Company and the several obligations of the
Underwriters hereunder are subject to the condition that the Registration
Statement shall have become effective not later than the date hereof.
The several obligations of the Underwriters hereunder are subject to
the following further conditions:
(a) Subsequent to the execution and delivery of this Agreement and prior to
the Closing Date:
12
(i) there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or of any
review for a possible change that does not indicate the direction of the
possible change, in the rating accorded any of the Company's securities by
any "nationally recognized statistical rating organization," as such term
is defined for purposes of Rule 436(g)(2) under the Securities Act; and
(ii) there shall not have occurred any change, or any development
reasonably likely to result in a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations, of the
Company and its subsidiaries, taken as a whole, from that set forth in the
Registration Statement (exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement), that, in your judgment, is
material and adverse and that makes it, in your judgment, impracticable to
market the Shares on the terms and in the manner contemplated in the
Prospectus.
(b) The Underwriters shall have received on the Closing Date a certificate,
dated the Closing Date and signed by an executive officer of the Company, to the
effect set forth in clause (a)(i) above and to the effect that the
representations and warranties of the Company contained in this Agreement are
true and correct as of the Closing Date and that the Company has complied with
all of the agreements and satisfied all of the conditions on its part to be
performed or satisfied hereunder on or before the Closing Date. The officer
signing and delivering such certificate may rely upon the best of his knowledge
as to proceedings threatened.
(c) You shall have received on the Closing Date an opinion of Xxxxx &
Xxxxxxx, counsel for the Company, dated the Closing Date, to the effect that:
(i) the authorized capital stock of the Company conforms as to
legal matters in all material respects to the description thereof contained
in the Prospectus; and
(ii) the statements (1) in the Prospectus under the caption
"Description of Capital Stock",
13
(2) in the Registration Statement in Item 15 and (3) in the Company's
Registration Statement on Form 8-A, as amended, describing the Company's
capital stock which is incorporated by reference in the Registration
Statement, in each case insofar as such statements constitute summaries of
the legal matters, documents or proceedings referred to therein, fairly
present in all material respects the information called for with respect to
such legal matters, documents and proceedings and fairly summarize the
matters referred to therein.
(d) You shall have received on the Closing Date an opinion of Xxxxx
Xxxxxxxxxx, counsel for the Company, dated the Closing Date, to the effect that:
(i) the execution and delivery by the Company of this Agreement
and the consummation of the transactions contemplated by this Agreement
have not, and the performance by the Company of its obligations under this
Agreement will not, contravene, violate, conflict with, result in a breach
of, or constitute a default under (i) any provision of applicable New York,
California or U.S. federal law or regulation, or (ii) to the best of such
counsel's knowledge (based solely on inquiries of responsible officers of
the Company), any judgment, determination, order or decree of any New York,
California or U.S. federal governmental body, agency or court having
jurisdiction over the Company or any subsidiary of the Company, except, in
the case of clauses (i) and (ii) hereof, any such contravention, violation,
conflict, breach or default that would not have a material adverse effect
on the Company and its subsidiaries, taken as a whole. No consent,
approval, authorization or order of or qualification with any New York,
California or U.S. federal governmental body or agency was required for the
execution of this Agreement by the Company or the consummation of the
transactions contemplated by this Agreement or is required for the
performance by the Company of its obligations under this Agreement, except
such as may be required by the securities or Blue Sky laws of New York or
California in connection with the offer and sale of the Shares;
14
(ii) each of Advanced Cardiovascular Systems, Inc. ("ACS"),
---
Devices for Vascular Intervention, Inc. ("DVI") and Origin Medsystems, Inc.
---
("Origin") has been duly incorporated, 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 its property and to conduct
its business as described in the Prospectus;
(iii) the outstanding shares of capital stock of each of ACS, DVI
and Origin have been duly authorized and validly issued, are fully paid and
nonassessable;
(iv) the statements (1) in the Prospectus under the captions
"Business - Legal Proceedings" and (2) in the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1995 in Item 1 under the
captions "Business - Government Regulation" and "Business - Health Care
Reform, Third Party Reimbursement", in each case insofar as such statements
constitute summaries of the legal matters, documents or proceedings
referred to therein, fairly present in all material respects the
information called for with respect to such legal matters, documents and
proceedings and fairly summarize the matters referred to therein;
(v) to the best of such counsel's knowledge (based solely on
inquiries of responsible officers of the Company), there are no legal or
governmental actions, suits, proceedings, claims or investigations pending
or threatened to which the Company or any of its subsidiaries is a party or
to which any of the properties of the Company or any of its subsidiaries is
subject that are required to be described in the Registration Statement or
the Prospectus and are not so described or which would affect the
performance by the Company of its obligations under this Agreement, nor
does such counsel know of any statutes, regulations, contracts or other
documents that are required to be described in the Registration Statement
or the Prospectus or to be filed as exhibits to the Registration Statement
that are not described or filed as required;
15
(vi) the Registration Statement and the Prospectus and any
supplements or amendments thereto (except for financial statements and the
notes related thereto, schedule and other financial, accounting and
statistical data as to which such counsel need not express any opinion)
comply as to form in all material respects with the Securities Act and the
rules and regulations of the Commission thereunder;
(vii) the Company is not 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;
(viii) the Registration Statement is effective under the
Securities Act and, to the best knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has been issued
under the Securities Act or proceedings therefor initiated or threatened by
the Commission; and
(ix) each document, if any, filed pursuant to the Exchange Act
and incorporated by reference in the Registration Statement and the
Prospectus (except for financial statements and notes related thereto,
schedule and other financial, accounting and statistical data included
therein or excluded therefrom as to which such counsel need not express an
opinion) complied when so filed as to form in all material respects with
the Exchange Act and rules and regulations of the Commission thereunder.
In addition, such counsel shall state that they have participated
in conferences with officers and representatives of the Company, officers
and representatives of the subsidiaries of the Company, representatives of
the independent accountants of the Company, the U.S. Representatives and
the International Representatives at which the contents of the Registration
Statement and the Prospectus and related matters were discussed and,
although such counsel need not pass upon or assume any responsibility for
the accuracy, completeness or fairness of the statements contained in the
Registration State-
16
ment or the Prospectus and have made no independent check or verification
thereof, except as described in paragraph (iv) above, on the basis of the
foregoing, no facts have come to such counsel's attention that have led
such counsel to believe that the Registration Statement, at the time it
became effective, contained an untrue statement of a material fact or
omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, or that the
Prospectus, as of its date and as of the Closing Date, contained or
contains an untrue statement of a material fact or omitted 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,
except that such counsel need not express an opinion or belief with respect
to information contained in the financial statements and the notes related
thereto, schedule and other financial, accounting and statistical data
included therein or excluded therefrom.
(e) You shall have received on the Closing Date an opinion of Xxxx X.
Xxxxx, Esq., counsel for CPI, dated the Closing Date, to the effect that:
(i) CPI has been duly incorporated and is validly existing as a
corporation in good standing under the laws of Minnesota, with full
corporate power and authority to own its property and to conduct its
business as described in the Prospectus;
(ii) the outstanding shares of capital stock of CPI have been
duly authorized and validly issued, are fully paid and nonassessable; and
(iii) no consent, approval, authorization or order of or
qualification with any Minnesota governmental body or agency was required
for the execution of this Agreement by the Company or the consummation of
the transactions contemplated by this Agreement or is required for the
performance by the Company of its obligations under this Agreement, except
such as may be required by the securities or Blue Sky laws of Minnesota in
connection with the offer and sale of the Shares.
17
(f) You shall have received on the Closing Date an opinion of X.X. Xxxx,
Esq., Vice President, General Counsel and Secretary of the Company, dated the
Closing Date, to the effect that:
(i) the Company has been duly incorporated and is validly
existing as a corporation under the laws of Indiana, with full corporate
power and authority to own its property and to conduct its business as
described in the Prospectus;
(ii) the Company and each subsidiary of the Company listed on
Annex A is duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as a
whole;
(iii) the outstanding shares of capital stock of each subsidiary
of the Company listed on Annex A are owned either directly or indirectly
(except for directors' qualifying shares) by the Company and, to the best
of such counsel's knowledge, are owned free and clear of all liens,
encumbrances and perfected or unperfected security interests, and, to the
best of such counsel's knowledge, no options, warrants or rights to
purchase, agreements or other obligations to issue or other rights to
convert any obligations into shares of capital stock or ownership interests
in any such subsidiary of the Company are outstanding;
(iv) the shares of Common Stock outstanding prior to the
issuance of the Shares have been duly authorized and are validly issued,
fully paid and non-assessable, and, to the best of such counsel's
knowledge, there are no outstanding options, warrants or other rights
granted by the Company to purchase shares of Common Stock or other
securities of the Company, except as described in the Prospectus and except
for stock options and performance awards granted to employees pursuant to
the Guidant Corporation 1994 Stock Plan and stock
18
options granted to directors pursuant to the Guidant Corporation 1996 Non-
employee Directors Stock Plan;
(v) the Shares have been duly authorized and, when issued and
delivered in accordance with the terms of this Agreement, will be validly
issued, fully paid and non-assessable, and the issuance of such Shares is
not subject to any statutory preemptive or, to the best of such counsel's
knowledge, any similar rights;
(vi) this Agreement has been duly authorized, executed and
delivered by the Company;
(vii) to the best knowledge of such counsel, neither the Company
nor any of its Material Subsidiaries is in violation of its certificate of
incorporation or by-laws or in default in the performance or observance of
any obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument binding upon the Company or any of its subsidiaries, other than
any such violation or default that would not have a material adverse effect
on the Company and its subsidiaries taken as a whole; and the execution and
delivery by the Company of this Agreement and the performance by the
Company of its obligations under this Agreement will not, contravene,
violate, conflict with, result in a breach of, or constitute a default
under (i) any provision of applicable law or regulation, (ii) the articles
of incorporation or by-laws of the Company or any Material Subsidiary of
the Company, (iii) to the best of such counsel's knowledge, any contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument binding upon the Company or any of its Material Subsidiaries, or
(iv) to the best of such counsel's knowledge, any judgment, determination,
order or decree of any governmental body, agency or court having
jurisdiction over the Company or any Material Subsidiary of the Company,
except, in the case of clauses (i), (iii) and (iv) hereof, any such
contravention that would not have a material adverse effect on the Company
and its subsidiaries, taken as a whole. No consent, approval,
authorization or order of or qualification with any state (other than
19
New York, California, Minnesota or Delaware as to which such counsel need
render no opinion) or local governmental body or agency was required for
the execution and delivery by the Company of this Agreement or is required
for the performance by the Company of its obligations under this Agreement,
except such as may be required by the securities or Blue Sky laws of the
various states of the United States in connection with the offer and sale
of the Shares;
(viii) to the best of such counsel's knowledge, there are no
legal or governmental actions, suits, proceedings, claims, or
investigations pending or threatened to which the Company or any of its
subsidiaries is a party or to which any of the properties of the Company or
any of its subsidiaries is subject that are required to be described in the
Registration Statement or the Prospectus and are not so described or which
would affect the performance by the Company of its obligations under this
Agreement, nor does such counsel know of any statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as required; and
(ix) to the best of such counsel's knowledge, each of the
Company and its Material Subsidiaries has all necessary Authorizations of
and from, and has made all Filings with, all state, local and other
governmental authorities, all self-regulatory organizations and all courts
and other tribunals, to own, lease, license and use its properties and
assets and to conduct its business in the manner described in the
Prospectus, or required for the performance by the Company of its
obligations under this Agreement, except to the extent that the failure to
obtain an Authorization or to make a Filing would not have a material
adverse effect on the Company and its subsidiaries, taken as a whole.
In addition, such counsel shall state that he or members of his
staff have participated in conferences with officers and representatives of
the Company, officers and representatives of the subsid-
20
iaries of the Company, representatives of the independent accountants of
the Company, the U.S. Representatives and the International Representatives
at which the contents of the Registration Statement and the Prospectus and
related matters were discussed and, although such counsel need not pass
upon or assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement or the
Prospectus and has made no independent check or verification thereof, on
the basis of the foregoing, no facts have come to the attention of such
counsel or any member of his staff that have led them to believe that the
Registration Statement, at the time it became effective, contained an
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading, or that the Prospectus, as of its date and as of the
Closing Date, contained or contains an untrue statement of a material fact
or omitted 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, except that such counsel need not express an opinion
or belief with respect to information contained in the financial statements
and the notes related thereto, schedules and other financial, accounting
and statistical data included therein or excluded therefrom.
In rendering such opinion, such counsel may state that such
opinion is limited to matters governed by the laws of the states of
Indiana, California, Delaware and Minnesota and that he has relied as to
matters involving the application of the laws of the states of California,
Delaware and Minnesota upon the opinion of other members of the Company's
legal department, Xxxx X. Xxxxx, Esq., counsel to CPI, or upon the law
firm of Xxxxx Xxxxxxxxxx, as the case may be.
(g) You shall have received on the Closing Date opinions of Xxxxx Xxxx,
General Counsel, and Secretary of CPI, Xxxxx X. Xxxxxxx, General Counsel and
Secretary of ACS, dated the Closing Date, in form and substance satisfactory to
you and your counsel relating to intellectual property matters.
21
The opinions described in paragraphs (c), (d), (e), (f) and (g) above
shall be rendered to you at the request of the Company and shall so state
therein.
(h) You shall have received on the Closing Date an opinion of Skadden,
Arps, Slate, Xxxxxxx & Xxxx, special counsel for the Underwriters, dated the
Closing Date, in form and substance satisfactory to you.
(i) You shall have received, on each of the date hereof and the Closing
Date, a letter dated the date hereof or the Closing Date, as the case may be, in
form and substance satisfactory to you, from Ernst & Young LLP, independent
public accountants, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained in, or
incorporated by reference into the Registration Statement and the Prospectus.
(j) On or prior to the Closing Date, the Company shall have delivered to
the U.S. Representatives and the International Representatives a letter executed
by certain officers and directors of the Company, in form and substance
reasonably satisfactory to you and your counsel, evidencing such officers' and
directors' agreement to be subject to lock-up provisions that are substantially
similar to those described in Article II of this Agreement, and such agreement
shall be in full force and effect on the Closing Date.
The several obligations of the U.S. Underwriters to purchase
Additional Shares hereunder are subject to the delivery to the U.S.
Representatives on the Option Closing Date of such documents as they may
reasonably request with respect to the good standing of the Company, the due
authorization and issuance of the Additional Shares and other matters related to
the issuance of the Additional Shares.
VI.
In further consideration of the agreements of the Underwriters herein
contained, the Company covenants as follows:
22
(a) To furnish to you, without charge, five signed copies of the
Registration Statement (including exhibits thereto) and for delivery to each
other Underwriter a conformed copy of the Registration Statement (without
exhibits thereto) and to furnish to you in New York City, without charge, prior
to 1:00 P.M. local time on the business day next succeeding the date of this
Agreement (or such later time as you and the Company shall agree if the
Underwriters have not provided information required to be included in the
Prospectus in a timely manner) and, during the period mentioned in paragraph (c)
below, as many copies of the Prospectus and any supplements and amendments
thereto or to the Registration Statement as you may reasonably request.
(b) Before amending or supplementing the Registration Statement or the
Prospectus, to furnish to you a copy of each such proposed amendment or
supplement and to file no such proposed amendment or supplement to which you
reasonably object. However, notwithstanding such reasonable objection, the
Company may file such proposed amendment or supplement, upon written
notification to you by Xxxxx Xxxxxxxxxx of the Company's intention to do so, if
in the opinion of Xxxxx Xxxxxxxxxx such filing is reasonably required to comply
with applicable law.
(c) If, during such period after the first date of the public offering of
the Shares as in the opinion of your counsel the Prospectus is required by law
to be delivered in connection with sales by an Underwriter or dealer, any event
shall occur or condition exist as a result of which it is necessary to amend or
supplement the Prospectus in order to make the statements therein, in the light
of the circumstances when the Prospectus is delivered to a purchaser, not
misleading, or if, in the opinion of your counsel, it is necessary to amend or
supplement the Prospectus to comply with law, forthwith to prepare, file with
the Commission and furnish, at its own expense, to the Underwriters and to the
dealers (whose names and addresses you will furnish to the Company) to which
Shares may have been sold by you on behalf of the Underwriters and to any other
dealers upon request, either amendments or supplements to the Prospectus so that
the statements in the Prospectus as so amended or supplemented will not, in the
light of the circumstances when the Prospectus is delivered to a purchaser, be
23
misleading or so that the Prospectus, as amended or supplemented, will comply
with law.
(d) To endeavor to qualify the Shares for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request and to pay all reasonable expenses (including reasonable fees and
disbursements of counsel) in connection with such qualification and in
connection with any review of the offering of the Shares by the National
Association of Securities Dealers, Inc.; provided, however, that the Company
shall not be obligated to file any general consent to service of process or to
qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to taxation in
respect of doing business in any jurisdiction in which it is not otherwise so
subject.
(e) To make generally available to the Company's security holders and to
you as soon as practicable an "earning statement" covering the twelve-month
period ending September 30, 1997 that satisfies the provisions of Section 11(a)
of the Securities Act and the rules and regulations of the Commission
thereunder.
(f) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of its obligations under this Agreement,
including: (i) the fees, disbursements and expenses of the Company's counsel and
the Company's accountants in connection with the registration and delivery of
the Shares under the Securities Act and all other fees or expenses in connection
with the preparation and filing of the Registration Statement, any preliminary
prospectus, the Prospectus and amendments and supplements to any of the
foregoing, including all printing costs associated therewith, and the mailing
and delivering of copies thereof to the Underwriters and dealers, in the
quantities hereinabove specified, (ii) all costs and expenses related to the
transfer and delivery of the Shares to the Underwriters, including any transfer
or other taxes payable thereon, (iii) the cost of printing or producing any Blue
Sky memorandum in connection with the offer and sale of the Shares under state
securities laws and all expenses in connection with the qualification of the
Shares for offer and sale under state securi-
24
ties laws as provided in Section 6(d) hereof, including filing fees and the
reasonable fees and disbursements of counsel for the Underwriters in connection
with such qualification and in connection with the Blue Sky memorandum, (iv) all
filing fees and disbursements of counsel to the Underwriters incurred in
connection with the review and qualification of the Offering by the National
Association of Securities Dealers, Inc., (v) all costs and expenses incident to
listing the Shares on the New York Stock Exchange and the Pacific Stock
Exchange, (vi) the cost of printing certificates representing the Shares, (vii)
the costs and charges of any transfer agent, registrar or depositary, (viii) the
costs and expenses of the Company relating to investor presentations on any
"road show" undertaken in connection with the marketing of the Offering,
including, without limitation, expenses associated with the production of road
show slides and graphics, fees and expenses of any consultants engaged in
connection with road show presentations with the prior approval of the Company,
travel and lodging expense of the representatives and officers of the Company
and any such consultants, and the cost of any aircraft chartered in connection
with the road show, and (ix) all other costs and expenses incident to the
performance of the obligations of the Company hereunder for which provision is
not otherwise made in this Section. It is understood, however, that except as
provided in this Article, Article VII, and the third paragraph of Article IX
below, the Underwriters will pay all of their costs and expenses, including fees
and disbursements of their counsel, stock transfer taxes payable on resale of
any of the Shares by them, and any advertising expenses connected with any
offers they may make.
(g) To use the proceeds from the sale of the Shares in the manner described
in the Prospectus under the caption "Use of Proceeds".
VII.
The Company agrees to indemnify and hold harmless each Underwriter and
each person, if any, who controls any Underwriter within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act from and
against any and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred by any
25
Underwriter or any such controlling person in connection with defending or
investigating any such action or claim) caused by any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or any amendment thereof, any preliminary prospectus or the Prospectus
(as amended or supplemented if the Company shall have furnished any amendments
or supplements thereto), or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages or liabilities are caused by any such untrue statement or omission or
alleged untrue statement or omission based upon information relating to any
Underwriter furnished to the Company in writing by such Underwriter through you
expressly for use therein; provided, however, that the foregoing indemnity with
respect to any preliminary prospectus shall not inure to the benefit of any
Underwriter from whom the person asserting any such losses, claims, damages or
liabilities purchased Shares, or any person controlling such Underwriter, if a
copy of the Prospectus (as then amended or supplemented if the Company shall
have furnished any amendments or supplements thereto) was not sent or given by
or on behalf of such Underwriter to such person, if required by law so to have
been delivered, at or prior to the written confirmation of the sale of the
Shares to such person, and if the Prospectus (as so amended or supplemented)
would have cured the defect giving rise to such losses, claims, damages or
liabilities.
Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers who sign the Registration
Statement and each person, if any, who controls the Company within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act to
the same extent as the foregoing indemnity from the Company to such Underwriter,
but only with reference to information relating to such Underwriter furnished to
the Company in writing by such Underwriter through you expressly for use in the
Registration Statement, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
In case any proceeding (including any governmental investigation)
shall be instituted involving any
26
person in respect of which indemnity may be sought pursuant to any of the two
preceding paragraphs, such person (the "indemnified party") shall promptly
-----------------
notify the person against whom such indemnity may be sought (the "indemnifying
------------
party") in writing and the indemnifying party, upon request of the indemnified
-----
party, shall retain counsel reasonably satisfactory to the indemnified party to
represent the indemnified party and any others the indemnifying party may
designate in such proceeding and shall pay the reasonable fees and disbursements
of such counsel related to such proceeding. In any such proceeding, any
indemnified party shall have the right to retain its own counsel, but the fees
and expenses of such counsel shall be at the expense of such indemnified party
unless (i) the indemnifying party and the indemnified party shall have mutually
agreed to the retention of such counsel or (ii) the named parties to any such
proceeding (including any impleaded parties) include both the indemnifying party
and the indemnified party and representation of both parties by the same counsel
would be inappropriate due to actual or potential differing interests between
them. It is understood that the indemnifying party shall not, in respect of the
legal expenses of any indemnified party in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable fees
and expenses of more than one separate firm (in addition to any local counsel)
for all such indemnified parties and that all such fees and expenses shall be
reimbursed as they are incurred. In the case of any such separate firm for the
Underwriters and such control persons of Underwriters, such firm shall be
designated in writing by Xxxxxx Xxxxxxx. In the case of any such separate firm
for the Company, and such directors, officers and control persons of the
Company, such firm shall be designated in writing by the Company. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. 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
27
settlement includes an unconditional release of such indemnified party from all
liability on claims that are the subject matter of such proceeding.
If the indemnification provided for in the first or second paragraph
of this Article VII is unavailable to an indemnified party or insufficient in
respect of any losses, claims, damages or liabilities referred to therein, then
each indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company 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 on the one hand and the
Underwriters on the other hand in connection with the statements or omissions
that resulted in such losses, claims, damages or liabilities, as well as any
other relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriters on the other hand in connection
with the offering of the Shares shall be deemed to be in the same respective
proportions as the net proceeds from the offering of the Shares (before
deducting expenses) received by the Company and the total underwriting discounts
and commissions received by the Underwriters, in each case as set forth in the
table on the cover of the Prospectus, bear to the aggregate public offering
price of the Shares. The relative fault of the Company on the one hand and the
Underwriters on the other hand shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Underwriters' respective obligations to contribute
pursuant to this Article VII are several in proportion to the respective number
of Shares they have purchased hereunder, and not joint.
28
The Company and the Underwriters agree that it would not be just or
equitable if contribution pursuant to this Article VII 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 the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Article VII, 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 it and distributed to the public were
offered to the public exceeds the amount of any damages that such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The remedies provided for in this Article VII are
not exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
The indemnity and contribution provisions contained in this Article
VII and the representations and warranties of the Company contained in this
Agreement shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by or on behalf
of any Underwriter or any person controlling any Underwriter or by or on behalf
of the Company, its officers or directors or any person controlling the Company
and (iii) acceptance of and payment for any of the Shares.
VIII.
This Agreement shall be subject to termination by notice given by you
to the Company, if (a) after the execution and delivery of this Agreement and
prior to the
29
Closing Date (i) trading generally shall have been suspended or materially
limited on or by, as the case may be, any of the New York Stock Exchange, the
American Stock Exchange, the National Association of Securities Dealers, Inc.,
the Chicago Board of Options Exchange, the Chicago Mercantile Exchange or the
Chicago Board of Trade, (ii) trading of any securities of the Company shall have
been suspended on any exchange or in any over-the-counter market, (iii) a
general moratorium on commercial banking activities in New York shall have been
declared by either Federal or New York State authorities, or (iv) there shall
have occurred any outbreak or escalation of hostilities or any change in
financial markets or any calamity or crisis that, in your judgment, is material
and adverse and (b) in the case of any of the events specified in clauses (a)(i)
through (iv), such event singly or together with any other such event makes it,
in your judgment, impracticable to market the Shares on the terms and in the
manner contemplated in the Prospectus.
IX.
This Agreement shall become effective upon the later of (x) execution
and delivery hereof by the parties hereto and (y) release of notification of the
effectiveness of the Registration Statement by the Commission.
If, on the Closing Date or the Option Closing Date, as the case may
be, any one or more of the Underwriters shall fail or refuse to purchase Shares
that it or they have agreed to purchase hereunder on such date, and the
aggregate number of Shares which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate number of the Shares to be purchased on such date, the other
Underwriters shall be obligated severally in the proportions that the number of
Firm Shares set forth opposite their respective names in Schedule I or Schedule
II bears to the aggregate number of Firm Shares set forth opposite the names of
all such non-defaulting Underwriters, or in such other proportions as you may
specify, to purchase the Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date; provided
--------
that in no event shall the number of Shares that any Underwriter has agreed to
purchase pursuant to Article II be increased pursuant to this Article IX by an
amount in excess of one-ninth of such number of
30
Shares without the written consent of such Underwriter. If, on the Closing Date
or the Option Closing Date, as the case may be, any Underwriter or Underwriters
shall fail or refuse to purchase Shares and the aggregate number of Shares with
respect to which such default occurs is more than one-tenth of the aggregate
number of Shares to be purchased on such date, and arrangements satisfactory to
you and the Company for the purchase of such Shares are not made within 36 hours
after such default, this Agreement shall terminate without liability on the part
of any non-defaulting Underwriter or the Company. In any such case either you
or the Company shall have the right to postpone the Closing Date or the Option
Closing Date, as the case may be, but in no event for longer than seven days, in
order that the required changes, if any, in the Registration Statement and in
the Prospectus or in any other documents or arrangements may be effected. Any
action taken under this paragraph shall not relieve any defaulting Underwriter
from liability in respect of any default of such Underwriter under this
Agreement.
If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
This Agreement may be signed in two or more counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.
31
This Agreement shall be governed by and construed in accordance with
the internal laws of the State of New York.
Very truly yours,
GUIDANT CORPORATION
By
------------------------
Name:
Title:
Accepted, October , 1996
XXXXXX XXXXXXX & CO. INCORPORATED
ALEX. XXXXX & SONS INCORPORATED
XXXXX & COMPANY
X.X. XXXXXX SECURITIES INC.
XXXXX XXXXXXX INC.
Acting severally on behalf
of themselves and the several
U.S. Underwriters named in
Schedule I hereto.
By Xxxxxx Xxxxxxx & Co. Incorporated
By
---------------------------
Name:
Title:
XXXXXX XXXXXXX & CO. INTERNATIONAL LIMITED
ALEX. XXXXX & SONS INCORPORATED
XXXXX & COMPANY
X.X. XXXXXX SECURITIES LTD.
XXXXX XXXXXXX INC.
Acting severally on behalf
of themselves and the several
International Underwriters named
in Schedule II hereto.
By Xxxxxx Xxxxxxx & Co. International Limited
By
---------------------------
Name:
Title:
32
SCHEDULE I
U.S. UNDERWRITERS
-----------------
Number of
Firm
Shares To
Underwriter Be Purchased
----------- ------------
Xxxxxx Xxxxxxx & Co. Incorporated . . . . .
Alex. Xxxxx & Sons Incorporated . . . . . .
Xxxxx & Company . . . . . . . . . . . . . .
X.X. Xxxxxx Securities Inc. . . . . . . . .
Xxxxx Xxxxxxx Inc. . . . . . . . . . . . .
Total U.S. Firm Shares. . . . . . . . . . . 7,200,000
SCHEDULE II
INTERNATIONAL UNDERWRITERS
--------------------------
Number of
Firm
Shares To
Underwriter Be Purchased
----------- ------------
Xxxxxx Xxxxxxx & Co. International Limited . . . . . . .
Alex. Xxxxx & Sons Incorporated . . . . . . . . . . . . .
Xxxxx & Company . . . . . . . . . . . . . . . . . . . . .
X.X. Xxxxxx Securities Ltd. . . . . . . . . . . . . . . .
Xxxxx Xxxxxxx Inc. . . . . . . . . . . . . . . . . . . .
Total International Shares. . . . . . . . . . . . . . . . 1,800,000
ANNEX A
. Advanced Cardiovascular Systems, Inc., a California corporation.
. Cardiac Pacemakers, Inc., a Minnesota corporation.
. Devices for Vascular Intervention, Inc., a California corporation.
. Origin Medsystems, Inc., a Delaware corporation.
