Exhibit 1.2
______________ Shares
PHYTERA, INC.
Common Stock
U.S. UNDERWRITING AGREEMENT
---------------------------
January __, 1999
XX XXXXX SECURITIES CORPORATION
CARNEGIE INC.
BANCBOSTON XXXXXXXXX XXXXXXXX INC.
As Representatives of the several U.S. Underwriters
c/o XX XXXXX SECURITIES CORPORATION
Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
1. Introductory. Phytera, Inc., a Delaware corporation (the "Company"),
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proposes to sell, pursuant to the terms of this Agreement, to the several
U.S. underwriters named in Schedule A hereto (the "U.S. Underwriters," or,
each, a "U.S. Underwriter"), an aggregate of ________ shares of Common
Stock, $0.01 par value (the "Common Stock"), of the Company. The aggregate
of _________ shares so proposed to be sold is hereinafter referred to as the
"U.S. Firm Stock". The Company also proposes to sell to the U.S.
Underwriters, upon the terms and conditions set forth in Section 3 hereof,
up to an additional _________ shares of Common Stock (the "U.S. Optional
Stock") solely to cover over-allotments in connection with the sale of the
U.S. Firm Stock. The U.S. Firm Stock and the U.S. Optional Stock are
hereinafter collectively referred to as the "U.S. Stock." XX Xxxxx
Securities Corporation ("XX Xxxxx"), Carnegie Inc. and Banc Boston Xxxxxxxxx
Xxxxxxxx Inc. are acting as representatives of the several U.S. Underwriters
and in such capacity are hereinafter referred to as the "U.S.
Representatives."
It is understood that the Company is concurrently entering into an agreement
dated the date hereof (the "European Underwriting Agreement") providing for
the sale to the several underwriters named in Schedule B hereto (the
"European Managers," or, each, a "European Manager"), of an aggregate of
___________ shares of Common Stock of the Company. The aggregate of
__________ shares so proposed to be sold is hereinafter referred to as the
"European Firm Stock." The Company also proposes to sell to the European
Managers, upon the terms and conditions set forth in Section 3 thereof, up
to an additional _______ shares of Common Stock (the "European Optional
Stock"). The European Firm Stock and the European Optional Stock are
hereinafter collectively referred to as the "European Stock." XX Xxxxx
International L.P., Carnegie Bank A/S and BancBoston Xxxxxxxxx Xxxxxxxx
International Ltd. are acting as representatives of the several European
Managers and in such capacity are hereinafter referred to as the "European
Representatives." The respective closings under this Agreement and the
European Underwriting Agreement are hereby expressly made conditional upon
one another.
The U.S. Underwriters and the European Managers are hereinafter collectively
referred to as the "Underwriters" and the U.S. Stock and the European Stock
are hereinafter collectively referred to as the "Stock."
The Company understands that the U.S. Underwriters and the European
Managers will concurrently enter into an Intersyndicate Agreement of even
date herewith (the "Intersyndicate Agreement") providing for the
coordination of certain transactions among the Underwriters under the
direction of XX Xxxxx (in such capacity, the "Global Coordinator") and
that, pursuant thereto and subject to the conditions set forth therein, the
European Managers may purchase from the U.S. Underwriters a portion of the
U.S. Stock and the U.S. Underwriters may purchase from the European
Managers a portion of the European Stock. The Company understands that any
purchases and sales between the European Managers and the U.S. Underwriters
shall be governed by the Intersyndicate Agreement and shall not be governed
by the terms of this Agreement or the European Underwriting Agreement.
The Company understands that the U.S. Underwriters propose to make a public
offering of the U.S. Stock as soon as the U.S. Representatives deem
advisable after this Agreement has been executed and delivered.
2. Representations and Warranties of the Company. The Company represents and
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warrants to, and agrees with, the several U.S. Underwriters that:
(a) A registration statement on Form S-1 (File No. 333-________) in
the form in which it became or becomes effective and also in such form
as it may be when any post-effective amendment thereto shall become
effective with respect to the Stock, including any pre-effective
prospectuses included as part of the registration statement as
originally filed or as part of any amendment or supplement thereto, or
filed pursuant to Rule 424 under the United States Securities Act of
1933, as amended (the "Securities Act"), and the rules and regulations
(the "Rules and Regulations") of the Securities and Exchange
Commission (the "Commission") thereunder, copies of which have
heretofore been delivered to you, has been carefully prepared by the
Company in conformity with the requirements of the Securities Act and
has been filed with the Commission under the Securities Act.
If it is contemplated, at the time this Agreement is executed, that a
post-effective amendment to the registration statement will be filed
and must be declared effective before the offering of the Stock may
commence, the term "Registration Statement" as used in this Agreement
means the registration statement as amended by said post-effective
amendment. The term "Registration Statement" as used in this
Agreement shall also include any registration statement relating to
the Stock that is filed and declared effective pursuant to Rule 462(b)
under the Securities Act. The term "Prospectus" as used in this
Agreement means each prospectus in the form included in the
Registration Statement, or, (A) if the prospectuses included in the
Registration Statement omit information in reliance on Rule 430A under
the Securities Act and such information is included in the
prospectuses filed with the Commission pursuant to Rule 424(b) under
the Securities Act, the term "Prospectus" as used in this Agreement
means each prospectus in the form included in the Registration
Statement as supplemented by the addition of the Rule 430A information
contained in the prospectus filed with the Commission pursuant to Rule
424(b) and (B) if prospectuses that meet the requirements of Section
10(a) of the Securities Act are delivered pursuant to Rule 434 under
the Securities Act, then (i) the term "Prospectus" as used in this
Agreement means each "prospectus subject to completion" (as such term
is defined in Rule 434(g) under the Securities Act) as supplemented by
(a) the addition of Rule 430A information or other information
contained in a form of prospectus delivered pursuant to Rule 434(b)(2)
under the Securities Act or (b) the information contained in the term
sheets described in Rule 434(b)(3) under the Securities Act, and (ii)
the date of such prospectuses shall be deemed to be the date of the
prospectuses delivered pursuant to Rule 434(b)(2) or the date of the
term sheets.
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Two or more forms of Pre-effective Prospectuses (as defined below) and
two forms of Prospectus are to be used in connection with the offering
and sale of the Stock: one or more Pre-effective Prospectuses and a
Prospectus relating to the U.S. Stock (each, a "Form of U.S.
Prospectus") and one or more Pre-effective Prospectuses and a
Prospectus relating to the European Stock (each, a "Form of European
Prospectus"). The Form of U.S. Prospectus is identical to the Form of
European Prospectus, except for the front cover and back cover pages.
The final Form of U.S. Prospectus and the final Form of European
Prospectus, in the forms first furnished to the Underwriters for use
in connection with the offering of the Stock are hereinafter referred
to as the "U.S. Prospectus" and the "European Prospectus,"
respectively, and collectively, the "Prospectuses." If Rule 434 is
relied on, the terms "U.S. Prospectus" and the "European Prospectus"
shall refer to the preliminary U.S. Prospectus dated ________ __, 1998
and preliminary European Prospectus dated ________ __, 1998,
respectively, each together with the applicable terms sheet described
in Rule 434(b)(3) under the Securities Act, and all references in this
Agreement to the date of such Prospectuses shall mean the date of the
applicable term sheet. For purposes of this Agreement, all references
to the Registration Statement, any preliminary prospectus, the U.S.
Prospectus, the European Prospectus or any term sheet or any amendment
or supplement to any of the foregoing shall be deemed to include the
copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system ("XXXXX").
References to the Prospectuses shall not be deemed to be references to
the prospectus prepared in the Danish language. The Danish language
prospectus, in preliminary and final form, and as amended or
supplemented, shall be collectively referred to as the "Danish
Prospectus." The European Prospectus shall be delivered by the
European Managers to all purchasers of the European Stock. To the
extent, if any, that the content of the Danish Prospectus does not
conform to the European Prospectus, the European Prospectus shall
prevail.
All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in
the Registration Statement, any preliminary prospectus (including the
Form of European Prospectus and Form of U.S. Prospectus) or the
Prospectuses (or other references of like import) shall be deemed to
mean and include all such financial statements (together with the
notes thereto) and schedules and other information which is
incorporated by reference in the Registration Statement, any
preliminary prospectus (including the Form of European Prospectus and
Form of U.S. Prospectus) or the Prospectuses, as the case may be.
The terms "Pre-effective Prospectus" and "preliminary prospectus" as
used in this Agreement mean each prospectus subject to completion in
the forms included in the Registration Statement at the time of the
initial filing of the Registration Statement with the Commission, and
as each such prospectus shall have been amended from time to time
prior to the date of the Prospectuses.
The Company has not and will not directly or indirectly bid for,
purchase, or attempt to induce any person to bid for or purchase,
Common Stock during the applicable restricted period under Section
242.102 of Regulation M under the Securities Act.
In addition, the Company has caused copies of the European Prospectus
to be filed with the Market Authority of the European Association of
Securities Dealers Automated Quotation market for financial
instruments ("EASDAQ"), the Banking and Finance Commission (the "CBF")
of the Kingdom of Belgium and the Copenhagen Stock Exchange (the
"CSE").
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(b) None of the Commission, the EASDAQ Market Authority, the CBF nor
the CSE has issued or threatened to issue any order preventing or
suspending the use of any Pre-effective Prospectus, and, at its date
of issue, each Pre-effective Prospectus conformed in all material
respects with the requirements of the Securities Act and the Rules and
Regulations, and each Pre-effective European Prospectus conformed in
all material respects with the requirements of the CSE, the CBF and
EASDAQ, and each Pre-effective Prospectus did not include 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, in
light of the circumstances under which they were made, not misleading;
and, when the Registration Statement is effective under the rules of
the Commission and at all times subsequent thereto up to and including
each of the Closing Dates (as hereinafter defined), the Registration
Statement and the Prospectuses and any amendments or supplements
thereto contained and will contain all material statements and
information required to be included therein by the Securities Act and
the Rules and Regulations, and conformed and will conform to the
requirements of the Securities Act and the Rules and Regulations, and
the European Prospectus and any supplement thereto contained all
material statements and information required to be included therein by
the CSE, the CBF and EASDAQ and conformed and will conform to the
requirements of the CSE, CBF and EASDAQ, and neither of the
Prospectuses, nor any supplement thereto, includes or will include any
untrue statement of a material fact or omits or will omit to state any
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; provided, however, that the foregoing
representations, warranties and agreements shall not apply to
information contained in or omitted from the Registration Statement or
any Pre-effective Prospectuses or the Prospectuses or any such
amendment or supplement thereto in reliance upon, and in conformity
with, written information furnished to the Company by or on behalf of
any U.S. Underwriter, directly or through any U.S. Representative,
specifically for use in the preparation thereof; there is no
franchise, lease, contract, agreement, instrument or other document or
law, rule, regulation, order, judgment, decree or legal or
governmental proceeding required to be described in the Registration
Statement or Prospectuses or to be filed as an exhibit to the
Registration Statement which is not described or filed therein as
required; and all descriptions of any such franchises, leases,
contracts, agreements, instruments or other documents or law, rule,
regulation, order, judgment, decree or legal or governmental
proceeding contained in the Registration Statement are accurate and
complete descriptions of such documents in all material respects.
(c) Subsequent to the respective dates as of which information is
given in the Registration Statement and Prospectuses, and except as
set forth or contemplated in the Prospectuses or otherwise in the
ordinary course of business since such dates, neither the Company nor
any of the Subsidiaries (as defined below) has incurred any
liabilities or obligations, direct or contingent, nor entered into any
transactions not in the ordinary course of business, and there has not
been any material adverse change in the condition (financial or
otherwise), properties, business, management, prospects, net worth or
results of operations of the Company and the Subsidiaries considered
as a whole, or any change in the capital stock, short-term or long-
term debt of the Company and the Subsidiaries considered as a whole.
The Company and its subsidiaries have no material contingent
obligations which are not disclosed in the Company's consolidated
financial statements included in the Prospectuses.
(d) The financial statements, together with the related notes and
schedules, set forth in the Prospectuses and elsewhere in the
Registration Statement fairly present, on the basis stated in the
Registration Statement, the financial position and the results of
operations and cash flows and changes in financial position of the
Company and its consolidated subsidiaries at the respective dates or
for the respective periods therein
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specified. Such statements and related notes and schedules have been
prepared in accordance with United States generally accepted
accounting principles applied on a consistent basis except as may be
set forth in the Prospectuses, and all adjustments necessary for a
fair presentation of results for such periods have been made. The
selected financial and statistical data set forth in the Prospectuses
under the captions "Prospectus Summary Summary Financial Data,"
"Capitalization," "Dilution," "Selected Financial Information,"
"Management's Discussion and Analysis of Financial Condition and
Results of Operations," "Management Executive Compensation," "Certain
Transactions," "Principal Stockholders" and "Shares Eligible for
Future Sale" fairly present, on the basis stated in the Registration
Statement and the Prospectuses, the information set forth therein and
such data has been compiled on a basis consistent with the financial
statements presented therein and the books and records of the Company.
(e) Xxxxxx Xxxxxxxx LLP, who have expressed their opinions on the
audited financial statements and related schedules included in the
Registration Statement and the Prospectuses, are independent public
accountants as required by the Securities Act and the Rules and
Regulations.
(f) Each of the Company and the Subsidiaries has been duly organized
and is validly existing and in good standing as a corporation under
the laws of its respective jurisdiction of organization, with power
and authority (corporate and other) to own or lease its properties and
to conduct its businesses as described in the Prospectuses; each of
the Company and the Subsidiaries are in possession of and operating in
compliance with all material franchises, grants, authorizations,
approvals, registrations, qualifications, licenses, permits,
easements, consents, certificates and orders required for the conduct
of its business, all of which are valid and in full force and effect;
and each of the Company and the Subsidiaries is duly qualified to do
business and in good standing as a foreign corporation in all other
jurisdictions where its ownership or leasing of properties or the
conduct of its businesses requires such qualification. Each of the
Company and the Subsidiaries has all requisite power and authority,
and all necessary material consents, approvals, authorizations,
orders, registrations, qualifications, licenses, certificates and
permits of and from all public regulatory or governmental agencies and
bodies to own, lease and operate its properties and conduct its
business as now being conducted and as described in the Registration
Statement and the Prospectuses, and no such consent, approval,
authorization, order, registration, qualification, license or permit
contains a materially burdensome restriction not adequately disclosed
in the Registration Statement and the Prospectuses. The Company owns
or controls, directly or indirectly, only the following corporations,
associations or other entities (each, a "Subsidiary" and collectively,
the Subsidiaries"):
(1) Phytera A/S;
(2) Phytera Limited; and
(3) Phytera Symbion ApS.
All outstanding shares of capital stock of each Subsidiary have been
duly authorized and validly issued, and are fully paid and non-
assessable and (except for directors' qualifying shares) are owned
directly or indirectly by the Company, free and clear of any liens,
encumbrances, equities or claims, and no options, warrants or other
rights to purchase, agreements or other obligations to issue or other
rights to convert any obligations into or exchange any obligations for
shares of capital stock or ownership interests in any Subsidiary are
outstanding.
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(g) The Company's authorized capital stock is on the date hereof, and
will be on the Closing Dates, as set forth under the heading
"Capitalization" in the Prospectuses; the Company's outstanding
capital stock was, as of the date set forth in the Prospectuses, the
amount so set forth; the outstanding shares of Common Stock (including
the outstanding shares of the Stock) of the Company conform to the
description thereof in the Prospectuses and have been duly authorized
and validly issued and are fully paid and non-assessable and have been
issued in compliance with all federal and applicable state securities
laws and were not issued in violation of or subject to any preemptive
rights or similar rights to subscribe for or purchase securities and
conform to the description thereof contained in the Prospectuses. Any
and all certificates representing the Stock are in due and proper form
and comply with all legal requirements and requirements of the
Company's Certificate of Incorporation, By-laws and other
organizational documents. Except as disclosed in and or contemplated
by the Prospectuses and the financial statements of the Company and
related notes thereto included in the Prospectuses, the Company does
not have outstanding any options, warrants, preemptive or other rights
to purchase or subscribe for shares of its capital stock or any
securities or obligations convertible or exchangeable into its shares
of capital stock, or any contracts or commitments to issue or sell,
shares of its capital stock or any such options, rights, securities or
obligations, except for those granted subsequent to the date of
information provided in the Prospectuses pursuant to the Company's
employee and stock option plans as disclosed in the Prospectuses. The
description of the Company's stock option and other stock plans or
arrangements, and the options or other rights granted or exercised
thereunder, as set forth in the Prospectuses, accurately and fairly
presents the information required to be shown with respect to such
plans, arrangements, options and rights.
(h) The U.S. Stock to be issued and sold by the Company to the U.S.
Underwriters hereunder and the European Stock to be issued and sold by
the Company to the European Managers under the European Underwriting
Agreement has been duly and validly authorized and, when issued and
delivered against payment therefor as provided herein, will be duly
and validly issued, fully paid and non-assessable and free of any
preemptive or similar rights and will conform to the description
thereof in the Prospectuses.
(i) Except as set forth in the Prospectuses, there are no legal or
governmental proceedings pending to which the Company or any of the
Subsidiaries is a party or of which any property of the Company or any
Subsidiary is the subject, which, if determined adversely to the
Company or any such Subsidiary, might individually or in the aggregate
(i) prevent or adversely affect the transactions contemplated by this
Agreement, (ii) suspend the effectiveness of the Registration
Statement, (iii) prevent or suspend the use of the Pre-effective
Prospectuses in any jurisdiction or (iv) result in a material adverse
change in the condition (financial or otherwise), properties,
business, business prospects, net worth or results of operations of
the Company and its subsidiaries considered as a whole and to the best
of the Company's knowledge there is no valid basis for any such legal
or governmental proceeding; and to the best of the Company's knowledge
no such proceedings are threatened or contemplated against the Company
or any Subsidiary by any governmental authority or any other person.
The Company is not a party nor subject to the provisions of any
material injunction, judgment, decree or order of any court,
regulatory body or other governmental agency or body. The description
of the Company's litigation and legal proceedings under the heading
"Business Legal Proceedings" in the Prospectuses is true and correct
and complies with the Rules and Regulations and the rules and
regulations of the CSE, the CBF and EASDAQ.
(j) The statements set forth in the Prospectus under the caption
"Description of Capital Stock," insofar as they purport to constitute
a summary of the terms of the capital stock, or under the captions
"Management," "Certain Transactions," "Principal
6
Stockholders" and "Shares Eligible for Future Sale," insofar as they
purport to describe facts or the provisions of the documents referred
to therein, are accurate and complete in all material respects.
(k) The execution, delivery and performance of this Agreement and the
European Underwriting Agreement and the consummation of the
transactions herein and therein contemplated (A) will not conflict
with or result in a breach or any violation of any of the terms or
provisions of the Certificate of Incorporation, By-laws or other
organizational documents of the Company or any of the Subsidiaries, or
any law, order, rule or regulation of any court or governmental agency
or body having jurisdiction over the Company or any of the
Subsidiaries or any of their respective properties or assets, (B) will
not conflict with or result in a breach or violation of any of the
terms or provisions of or constitute a default under any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of the Subsidiaries is a party
or by which it or any of its or their respective properties or assets
is or may be bound, and (C) do not and will not result in the creation
of a lien against any such property.
(l) None of the Company or any of the Subsidiaries is, or with notice
or lapse of time or both will be, in violation of or in default under
its Certificate of Incorporation or By-laws or other organizational
documents or in default in the performance or observance of any
material obligation, agreement, covenant or condition contained in any
indenture, mortgage, note, deed of trust, loan agreement, lease or
other agreement or instrument to which it is a party or by which it or
any of its properties may be bound. None of the Company or any of the
Subsidiaries has received any notice of such violation or default.
(m) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery
and performance of this Agreement or the European Underwriting
Agreement by the Company and the consummation of the transactions
contemplated herein or therein, except such as may be required by the
National Association of Securities Dealers, Inc. (the "NASD"), the
Commission, the CSE, the CBF, the European Association of Securities
Dealers, Inc., or under the Securities Act, the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), or the securities or
"Blue Sky" laws of any jurisdiction in connection with the purchase
and distribution of the U.S. Stock by the U.S. Underwriters and the
European Stock by the European Managers.
(n) The Company has the full corporate power and authority to enter
into this Agreement and the European Underwriting Agreement and to
perform its obligations hereunder and thereunder (including to issue,
sell and deliver the U.S. Stock and European Stock), and this
Agreement and the European Underwriting Agreement have each been duly
and validly authorized, executed and delivered by the Company and
constitute valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms, except to the
extent that rights to indemnity and contribution hereunder or
thereunder may be limited by securities laws of any applicable
national or state jurisdiction or the public policy underlying such
laws.
(o) The Company and each of the Subsidiaries is in all material
respects in compliance with, and conduct their businesses in
conformity with, all applicable laws, rules and regulations and
decisions and orders of any court or governmental agency or body
having competent jurisdiction over it; to the knowledge of the Company
after due inquiry, except as set forth in the Registration Statement
and the Prospectuses, no prospective change in any of such laws, rules
or regulations has been adopted which, when made effective, would have
a material adverse effect on the operations of the
7
Company and the Subsidiaries, individually or taken as a whole. In the
ordinary course of business, employees of the Company and the
Subsidiaries conduct periodic reviews of the effect of Environmental
Laws (as defined below) on the business operations and properties of
the Company and the Subsidiaries, in the ordinary course of which they
seek to identify and evaluate associated costs and liabilities. Except
as disclosed in the Registration Statement and the Prospectuses, each
of the Company and the Subsidiaries is in compliance with all
applicable existing national, state and local laws and regulations
relating to the protection of human health or the environment or
imposing liability or requiring standards of conduct concerning any
Hazardous Materials ("Environmental Laws"), except for such instances
of noncompliance which, either singly or in the aggregate, would not
have a material adverse effect. The term "Hazardous Material" means
(i) any "hazardous substance" as defined by the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as
amended, (ii) any "hazardous waste" as defined by the Resource
Conservation and Recovery Act, as amended, (iii) any petroleum or
petroleum product, (iv) any polychlorinated biphenyl and (v) any
pollutant or contaminant or hazardous, dangerous or toxic chemical,
material, waste or substance regulated under or within the meaning of
any other Environmental Law.
(p) The Company and each of the Subsidiaries has filed all necessary
national, state and local income, payroll, franchise and other tax
returns and have paid all taxes shown as due thereon or with respect
to any of its properties, and there is no tax deficiency that has
been, or to the knowledge of the Company is likely to be, asserted
against the Company or any of the Subsidiaries or any of their
respective properties or assets that would adversely affect the
financial position, business or operations of the Company and the
Subsidiaries, individually or taken as a whole. All tax liabilities
of the Company and each of the Subsidiaries have been adequately
provided for, as reflected in the financial statements and related
notes.
(q) No person or entity has the right to require registration of
shares of Common Stock or other securities of the Company because of
the filing or effectiveness of the Registration Statement or
otherwise, except for persons and entities who have expressly waived
such right or who have been given proper notice and have failed to
exercise such right within the time or times required under the terms
and conditions of such right.
(r) Neither the Company nor any of its officers, directors or
affiliates (as defined in Rule 405 of the Securities Act) has taken or
will take, directly or indirectly, any action designed or intended to
stabilize or manipulate the price of any security of the Company, or
which caused or resulted in, or which might in the future reasonably
be expected to cause or result in, stabilization or manipulation of
the price of any security of the Company.
(s) The Company has provided you with all financial statements since
December 31, 1997 to the date hereof that are available to the
officers of the Company, including financial statements for the three
month period ended March 31, 1998, the three month and six month
periods ended June 30, 1998 and the three month and nine month periods
ended September 30, 1998, and for the months of October and November
1998.
(t) The Company and the Subsidiaries own or possess the right to use
all patents, trademarks, trademark registrations, service marks,
service xxxx registrations, trade names, copyrights, licenses,
inventions, trade secrets, know-how and rights (collectively,
"Intellectual Property Rights") described in the Prospectuses as being
owned by them or any of them or necessary for the conduct of their
respective businesses, and neither the Company nor any Subsidiary is
aware of any claim to the contrary or any challenge or infringement by
any other person to or of the rights of the Company and the
Subsidiaries
8
with respect to the foregoing. The business of the Company and each
Subsidiary as now conducted and as proposed to be conducted as
described in the Prospectuses does not and, to the knowledge of the
Company, will not infringe or conflict with any Intellectual Property
Rights or franchise right of any person. Except as disclosed in the
Prospectuses, the expiration or loss of any Intellectual Property
Right of the Company or any Subsidiary would not have a material
effect on the condition (financial or otherwise), business, results of
operations or prospects of the Company and the Subsidiaries considered
as a whole.
(u) The Company and the Subsidiaries have performed all material
obligations required to be performed by them under all contracts
required by the Rules and Regulations to be described in or filed as
exhibits to the Registration Statement, all such contracts have been
so described and/or filed, and none of the Company or any of the
Subsidiaries or any other party to any such contract is in default
under its terms or in breach of any of its respective obligations
thereunder. Neither the Company nor any of the Subsidiaries has
received any notice of any such default or breach.
(v) The Company is not involved in any labor dispute nor is any such
dispute threatened. The Company is not aware that (A) any executive,
key employee or significant group of employees of the Company or any
Subsidiary plans to terminate employment with the Company or any such
Subsidiary or (B) any such executive or key employee is subject to any
noncompete, nondisclosure, confidentiality, employment, consulting or
similar agreement that would be violated by any such person's
participation in the present or proposed business activities of the
Company and the Subsidiaries as described in the Prospectuses.
Neither the Company nor any Subsidiary has or expects to have 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 United States
Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
or any similar plan subject to the laws and rules and regulations of
any other jurisdiction, to which the Company or any such Subsidiary
makes or ever has made a contribution and in which any employee of the
Company or any Subsidiary is or has ever been a participant. With
respect to such plans, the Company and each Subsidiary are in
compliance in all material respects with all applicable provisions of
ERISA and all other such laws.
(w) The Company has obtained the written agreement described in
Section 9(p) of this Agreement from each of its officers, directors
and holders of Common Stock, or securities convertible into or
exchangeable or exercisable for Common Stock listed on Schedule C
hereto.
(x) The Company and the Subsidiaries have, and the Company and the
Subsidiaries as of each of the Closing Dates will have, good and
marketable title in fee simple to all real property and good and
marketable title to all personal property owned or proposed to be
owned by them which is material to the business of the Company or of
the Subsidiaries, in each case free and clear of all liens,
encumbrances and defects, except such as are described the
Prospectuses or such as would in the aggregate not have a material
adverse effect on the Company and the Subsidiaries considered as a
whole; and any real property and buildings held under lease by the
Company and the Subsidiaries or proposed to be leased by any of them
after giving effect to the transactions described in the Prospectuses
are, or as of each of the Closing Dates will be, held by them under
valid, existing and enforceable leases except as would not have a
material adverse effect on the Company and the Subsidiaries considered
as a whole, in each case except as described in the Prospectuses.
9
(y) The Company and the Subsidiaries 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 or propose to engage after giving effect to the transactions
described in the Prospectuses; and neither the Company nor any
Subsidiary 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 their business at a cost that would not materially and
adversely affect the condition, financial or otherwise, or the
earnings, business or operations of the Company and the Subsidiaries
considered as a whole, except as described in the Prospectuses.
(z) Other than as contemplated by this Agreement or the European
Underwriting Agreement, there is no broker, finder or other party that
is entitled to receive from the Company any brokerage or finder's fee
or other fee, commission or other compensation as a result of any of
the transactions contemplated by this Agreement or the European
Underwriting Agreement.
(aa) The Company and each of the Subsidiaries maintains a system of
internal accounting controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with
management's general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain accountability for assets; (iii) access to assets is
permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate
action is taken with respect to any differences.
(bb) To the Company's knowledge, neither the Company nor any of the
Subsidiaries nor any employee or agent of the Company or any of the
Subsidiaries has made any payment of funds of the Company or any of
the Subsidiaries or received or retained any funds in violation of any
law, rule or regulation.
(cc) Neither the Company nor any of the Subsidiaries is or, after
application of the net proceeds of this offering as described under
the caption "Use of Proceeds" in the Prospectuses, will become an
"investment company" or an entity "controlled" by an "investment
company" as such terms are defined in the United States Investment
Company Act of 1940, as amended (the "Investment Company Act"). The
Company intends to conduct its affairs in a manner such that it will
not become an entity required to register as an "investment company"
subject to regulation under the Investment Company Act.
(dd) The Common Stock has been approved for listing and admission to
trading on the CSE and EASDAQ, respectively, subject to official
notice of issuance.
Each certificate signed by any officer of the Company and delivered to the
U.S. Underwriters or counsel for the U.S. Underwriters shall be deemed to be a
representation and warranty by the Company as to the matters covered thereby.
3. Purchase by, and Sale and Delivery to, U.S. Underwriters - Closing Dates.
------------------------------------------------------------------------
The Company agrees to sell to the U.S. Underwriters the U.S. Firm Stock
and, on the basis of the representations, warranties, covenants and
agreements herein contained, but subject to the terms and conditions herein
set forth, each U.S. Underwriter agrees, severally and not jointly, to
purchase the U.S. Firm Stock from the Company, the number of shares of U.S.
Firm Stock to be purchased by each
10
U.S. Underwriter being set opposite its name in Schedule A, subject to
adjustment in accordance with Section 13 hereof.
The purchase price per share to be paid by the U.S. Underwriters to the
Company will be the price per share set forth in the table on the cover
page of the Prospectus as the "Proceeds, before expenses, to Phytera" (the
"Purchase Price").
Each U.S. Underwriter agrees that, except to the extent permitted by the
Intersyndicate Agreement, it will not offer or sell any of the U.S. Stock
outside of the United States and Canada or to anyone other than a United
States or Canadian person. As used herein, "United States or Canadian
Person" means any national or resident of the United States or Canada or
any corporation, pension, profit-sharing or other trust or other entity
organized under the laws of the United States or Canada or of any political
subdivision thereof (other than a branch located outside the United States
or Canada of any United States or Canadian Person), and includes any United
States or Canadian branch of a person who is otherwise not a United States
or Canadian Person.
The Company will deliver the U.S. Firm Stock to the U.S. Representatives
for the respective accounts of the several U.S. Underwriters (in the form
of definitive certificates or book entries, as instructed by the U.S.
Underwriters, issued in such names and in such denominations as the U.S.
Representatives may direct by notice in writing to the Company given at or
prior to 12:00 Noon, New York Time, not later than the second full business
day preceding the First Closing Date (as defined below) or, if no such
direction is received, in the names of the respective U.S. Underwriters or
in such other names as XX Xxxxx may designate (solely for the purpose of
administrative convenience) and in such denominations as XX Xxxxx may
determine, against payment of the aggregate Purchase Price therefor by wire
transfer or certified or official bank check or checks in Federal or
similar same-day funds, payable to the order of the Company, all at the
offices of Xxxxx & Wood llp, Xxx Xxxxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000. The time and date of the delivery and closing shall be at 10:00
A.M., New York time, on ____________, 1999, in accordance with Rule 15c6-1
of the Exchange Act. The time and date of such payment and delivery are
herein referred to as the "First Closing Date". The First Closing Date and
the location of delivery of, and the form of payment for, the U.S. Firm
Stock may be varied by agreement between the Company and XX Xxxxx. The
First Closing Date may be postponed pursuant to the provisions of Section
13 hereof.
The Company shall make the certificates, if any, for the U.S. Stock
available to the U.S. Representatives for examination on behalf of the U.S.
Underwriters not later than 10:00 A.M., New York Time, on the business day
preceding the First Closing Date at the offices of XX Xxxxx, Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
It is understood that XX Xxxxx , individually and not as U.S.
Representative of the several U.S. Underwriters or as Global Coordinator,
may (but shall not be obligated to) make payment to the Company on behalf
of any U.S. Underwriter or U.S. Underwriters, for the Stock to be purchased
by such U.S. Underwriter or U.S. Underwriters. Any such payment by XX
Xxxxx shall not relieve such U.S. Underwriter or U.S. Underwriters from any
of its or their other obligations hereunder.
The several U.S. Underwriters agree to make an initial public offering of
the U.S. Firm Stock at the initial public offering price (the price per
share set forth on the cover page of the Prospectuses as the "Public
offering price") as soon after the effectiveness of the Registration
Statement as in their judgment is advisable. Such offering in the United
States shall be made only to "qualified institutional buyers" ("QIBS"), as
defined in Rule 144A under the Securities Act, but only to the extent that
such offering is in compliance with applicable state securities laws. The
U.S. Representatives shall promptly advise the Company of the making of the
initial public offering.
11
For the purpose of covering any over-allotments in connection with the
distribution and sale of the U.S. Firm Stock as contemplated by the U.S.
Prospectus, on the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, the
Company hereby grants to the U.S. Underwriters an option to purchase,
severally and not jointly, up to the number of shares of U.S. Optional
Stock set forth on Schedule A hereto, for an aggregate of up to __________
shares. The price per share to be paid for the Optional Stock shall be the
Purchase Price. The option granted hereby may be exercised as to all or
any part of the U.S. Optional Stock at any time, and from time to time, not
more than thirty (30) days subsequent to the effective date of this
Agreement. No U.S. Optional Stock shall be sold and delivered unless the
U.S. Firm Stock previously has been, or simultaneously is, sold and
delivered. The right to purchase the U.S. Optional Stock or any portion
thereof may be surrendered and terminated at any time upon notice by the
U.S. Underwriters to the Company.
The option granted hereby may be exercised by the U.S. Underwriters by
written notice from XX Xxxxx to the Company setting forth the number of
shares of the U.S. Optional Stock to be purchased by them and the date and
time for delivery of and payment for the U.S. Optional Stock. Each date
and time for delivery of and payment for U.S. Optional Stock (which may be
the First Closing Date, but not earlier) is herein called an "Option
Closing Date" and shall in no event be earlier than two (2) business days
nor later than ten (10) business days after written notice is given. Each
Option Closing Date and the First Closing Date are herein called the
"Closing Dates." All purchases of U.S. Optional Stock from the Company
shall be made on a pro rata basis. U.S. Optional Stock shall be purchased
for the account of each U.S. Underwriter in the same proportion (or as
nearly as practicable) as the number of shares of U.S. Firm Stock set forth
opposite such U.S. Underwriter's name in Schedule A hereto bears to the
total number of shares of U.S. Firm Stock (subject to adjustment by the
U.S. Underwriters to eliminate odd lots). Upon exercise of the option by
the U.S. Underwriters, the Company agrees to sell to the U.S. Underwriters
the number of shares of U.S. Optional Stock set forth in the written notice
of exercise and the U.S. Underwriters agree, severally and not jointly and
subject to the terms and conditions herein set forth, to purchase the
number of such shares determined as aforesaid.
The Company will deliver the U.S. Optional Stock to the U.S. Underwriters
in the form of definitive certificates or book entries, as instructed by
the U.S. Underwriters, issued in such names and in such denominations as
the U.S. Representatives may direct by notice in writing to the Company
given at or prior to 12:00 Noon, New York time, not later than the second
full business day preceding the Option Closing Date or, if no such
direction is received, in the names of the respective U.S. Underwriters or
in such other names as XX Xxxxx may designate (solely for the purpose of
administrative convenience) and in such denominations as XX Xxxxx may
determine, against payment of the aggregate Purchase Price therefor by wire
transfer or certified or official bank check or checks in Federal or
similar same-day funds, payable to the order of the Company all at the
offices of Xxxxx & Wood llp, Xxx Xxxxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000. The Company shall make the certificates, if any, for the Optional
Stock available to the U.S. Underwriters for examination on behalf of the
U.S. Underwriters not later than 10:00 A.M., New York time, on the business
day preceding the relevant Option Closing Date at the offices of XX Xxxxx,
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000. The Option Closing Date and
the location of delivery of, and the form of payment for, the U.S. Option
Stock may be varied by agreement between the Company and XX Xxxxx. The
Option Closing Date may be postponed pursuant to the provisions of Section
13 hereto.
4. Offers and Sales of the Stock to United States or Canadian Persons. Each
------------------------------------------------------------------
of the U.S. Underwriters and the Company hereby establish and agree to
observe the following procedures in connection with the offer and sale of
the Stock to "United States or Canadian Persons":
(a) Offers and sales of shares of Stock to United States persons will
be made only by the U.S. Underwriters or affiliates thereof qualified
to do so in the jurisdiction in which
12
such offers or sales are made. Each such offer or sale shall only be
made to certain persons, each of whom the offeror or seller, or any
person acting on behalf of the offeror or seller, reasonably believes
to be a QIB.
(b) In the case of a non-bank purchaser acting as a fiduciary for one
or more third parties, in connection with an offer and sale to such
purchaser pursuant to clause (a) above, each such third party shall in
the judgment of the applicable U.S. Underwriter be a QIB.
5. Covenants and Agreements of the Company. The Company covenants and agrees
---------------------------------------
with the several U.S. Underwriters that:
(a) The Company will (i) if the Company and the U.S. Representatives
have determined not to proceed pursuant to Rule 430A of the Rules and
Regulations, use its best efforts to cause the Registration Statement
to become effective as soon as practicable after the execution of this
Agreement, (ii) if the Company and the U.S. Representatives have
determined to proceed pursuant to Rule 430A of the Rules and
Regulations, use its best efforts to comply with the provisions of and
make all requisite filings with the Commission pursuant to Rule 430A
and Rule 424 of the Rules and Regulations and (iii) if the Company and
the U.S. Representatives have determined to deliver Prospectuses
pursuant to Rule 434 of the Rules and Regulations, to use its best
efforts to comply with all the applicable provisions thereof. The
Company will use its best efforts to obtain any approval of the
European Prospectus from each of the CSE, the CBF and the EASDAQ
Market Authority required to permit the offer and sale to the public
of the European Stock in Belgium, Denmark and such other jurisdictions
in Europe as the European Representatives may request and the listing
and admission to trading of the Common Stock on the CSE and EASDAQ,
respectively. The Company will advise the U.S. Representatives
promptly as to the time at which the Registration Statement or any
post-effective amendment thereto becomes effective and the
Prospectuses have been approved, as the case may be, will advise the
U.S. Representatives promptly of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement,
or by the CSE, the CBF and EASDAQ of any order preventing or
suspending the use of any Pre-effective European Prospectus or the
European Prospectus, or of the institution of any proceedings for any
of those purposes, and will use its best efforts to prevent the
issuance of any such order and to obtain as soon as possible the
lifting thereof, if issued. The Company will advise the U.S.
Representatives promptly of the receipt of any comments of the
Commission, the CSE, the CBF or the EASDAQ Market Authority or any
request by the Commission, the CSE, the CBF or the EASDAQ Market
Authority for any amendment of or supplement to the Registration
Statement or the Prospectuses or for additional information and will
not at any time file any amendment to the Registration Statement or
supplement to the Prospectuses which shall not previously have been
submitted to the U.S. Representatives a reasonable time prior to the
proposed filing thereof or to which the U.S. Representatives shall
reasonably object in writing or which is not in compliance with the
Securities Act and the Rules and Regulations or the rules and
regulations of the CSE, the CBF or EASDAQ.
(b) The Company will prepare and file with the Commission, the CSE,
the CBF and EASDAQ promptly upon the request of the U.S.
Representatives, any amendments or supplements to the Registration
Statement or the Prospectuses which in the reasonable opinion of the
U.S. Representatives may be necessary to enable the several U.S.
Underwriters to continue the distribution of the U.S. Stock and the
several European Managers to continue the distribution of the European
Stock and will use its best efforts to cause the same to become
effective or approved, as the case may be, as promptly as possible.
13
(c) If at any time after the effective date of the Registration
Statement when a prospectus relating to the Stock is required to be
delivered under the Securities Act or the rules and regulations of the
CSE, the CBF or EASDAQ any event relating to or affecting the Company
or any of the Subsidiaries occurs as a result of which the
Prospectuses or any other prospectus as then in effect would include
an untrue statement of a material fact, or omit to state any material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectuses to comply with the
Securities Act and the Rules and Regulations, or the rules and
regulations of the CSE, the CBF or EASDAQ, the Company will promptly
notify the U.S. Representatives thereof and will prepare amended or
supplemented prospectuses which will correct such statement or
omission; and in case any U.S. Underwriter is required to deliver a
prospectus relating to the U.S. Stock nine months or more after the
effective date of the Registration Statement, the Company, upon the
request of the U.S. Representatives and at the expense of such U.S.
Underwriter, will prepare promptly such prospectus or prospectuses as
may be necessary to permit compliance with the requirements of Section
10(a)(3) of the Securities Act or any equivalent rules and regulations
of the CSE, the CBF and EASDAQ.
(d) The Company will deliver to the U.S. Representatives, at or before
the Closing Dates, four signed copies of the Registration Statement,
as originally filed with the Commission, and all amendments thereto,
including all financial statements and exhibits thereto, and four
signed copies of the European Prospectus and all supplements thereto,
and will deliver to the U.S. Representatives such number of copies of
the Registration Statement, including such financial statements but
without exhibits, and all amendments thereto, as the U.S.
Representatives may reasonably request. The Company will deliver or
mail to or upon the order of the U.S. Representatives, from time to
time until the effective date of the Registration Statement, as many
copies of the Pre-effective Prospectus as the Representatives may
reasonably request. The Company will deliver or mail to or upon the
order of the U.S. Representatives on the date of the initial public
offering, and thereafter from time to time during the period when
delivery of a prospectus relating to the U.S. Stock is required under
the Securities Act and the Rules and Regulations, as many copies of
the U.S. Prospectus, in final form or as thereafter amended or
supplemented as the U.S. Representatives may reasonably request;
provided, however, that the expense of the preparation and delivery of
any U.S. Prospectus required for use nine months or more after the
effective date of the Registration Statement shall be borne by the
U.S. Underwriters required to deliver such U.S. Prospectus.
(e) The Company will make generally available to its shareholders as
soon as practicable, but not later than 15 months after the effective
date of the Registration Statement, an earning statement which will be
in reasonable detail (but which need not be audited) and which will
comply with Section 11(a) of the Securities Act, covering a period of
at least 12 consecutive months beginning after the "effective date"
(as defined in Rule 158 under the Securities Act) of the Registration
Statement and will advise XX Xxxxx in writing when such statement has
been made available.
(f) The Company will cooperate with the U.S. Representatives to enable
the Stock to be registered or qualified for offering and sale by the
U.S. Underwriters and by dealers under the securities laws of such
jurisdictions as the U.S. Representatives may designate and at the
request of the U.S. Representatives will make such applications and
furnish such consents to service of process or other documents as may
be required of it as the issuer of the U.S. Stock for that purpose;
provided, however, that the Company shall not be required to qualify
to do business or to file a general consent (other than that arising
out of the offering or sale of the Stock) to service of process in any
such jurisdiction where it is not now so subject. The Company will,
from time to time, prepare and file
14
such statements and reports as are or may be required of it as the
issuer of the Stock to continue such qualifications in effect for so
long a period as the U.S. Representatives may reasonably request for
the distribution of the Stock. The Company will advise the U.S.
Representatives promptly after the Company becomes aware of the
suspension of the qualifications or registration of (or any such
exception relating to) the Common Stock of the Company for offering,
sale or trading in any jurisdiction or of any initiation or threat of
any proceeding for any such purpose, and in the event of the issuance
of any orders suspending such qualifications, registration or
exception, the Company will, with the cooperation of the U.S.
Representatives use its best efforts to obtain the withdrawal thereof.
(g) As and when required by the Rules and Regulations or, if more
frequently or sooner by applicable regulations of the CSE, the CBF and
EASDAQ, the Company will furnish to its shareholders annual reports
containing financial statements certified by independent public
accountants, and quarterly summary financial information in reasonable
detail which may be unaudited. During the period of five years from
the date hereof, the Company will deliver to the U.S. Representatives
and, upon request of the U.S. Representatives, to each of the other
U.S. Underwriters, (i) as soon as practicable after the end of each
fiscal year, copies of each annual report of the Company containing
financial statements certified by independent public accountants and
each other report furnished by the Company to its shareholders, (ii)
as soon as they are available, copies of any other reports (financial
or other) which the Company shall publish or otherwise make available
to any of its shareholders as such, (iii) as soon as practicable after
the filing thereof, copies of any reports, documents, financial
statements and other information furnished to or filed by the Company
with the Commission, the NASD, the CSE, the CBF, EASDAQ or any other
securities exchange or electronic quotation system, including each
proxy statement, Annual Report on Form 10-K, Quarterly Report on Form
10-Q and Report on Form 8-K filed with the Commission and (iv) from
time to time such other information concerning the Company as the U.S.
Representatives may request. So long as the Company has active
subsidiaries, such financial statements will be on a consolidated
basis to the extent the accounts of the Company and its subsidiaries
are consolidated in reports furnished to its shareholders generally.
Separate financial statements shall be furnished for all subsidiaries
whose accounts are not consolidated but which at the time are
significant subsidiaries as defined in the Rules and Regulations.
(h) The Company will comply with all applicable rules and regulations
with respect to listing on the CSE and admission to trading securities
on EASDAQ and with all CSE and EASDAQ rules and regulations. The
Company will use its best efforts to maintain the listing and
admission to trading of the Common Stock on the CSE and EASDAQ,
respectively, for a period of not less than five years after the
effective date of the Registration Statement.
(i) The Company will maintain one or more independent registrars and
transfer agents for its Common Stock.
(j) Prior to filing its quarterly financial statements on Form 10-Q,
the Company will have its independent auditors perform a limited
quarterly review of its quarterly financial statements and other
financial and statistical data required to be included therein.
(k) The Company will not offer, sell, assign, transfer, encumber,
contract to sell, grant an option to purchase or otherwise dispose of
any shares of Common Stock or securities convertible into or
exercisable or exchangeable for Common Stock (including, without
limitation, Common Stock of the Company which may be deemed to be
beneficially owned by the Company in accordance with the Rules and
Regulations)
15
during the 180 days following the date on which the price of the U.S.
Stock to be purchased by the U.S. Underwriters is set, other than (i)
the Company's sale of Common Stock hereunder, (ii) the Company's
issuance of Common Stock upon the exercise of warrants or stock
options which are presently outstanding and described in the
Prospectuses and (iii) the issuance by the Company of any shares or
option to purchase any shares of Common Stock pursuant to its option
plan or employee stock purchase plan described in the Prospectuses.
(l) Prior to filing with the Commission any reports required pursuant
to Rule 463 of Rules and Regulations, the Company will furnish a copy
thereof to the counsel for the U.S. Underwriters and receive and
consider its comments thereon, and will deliver promptly to the U.S.
Representatives four signed copies of each such report filed by it
with the Commission.
(m) The Company will apply the net proceeds from the sale of the Stock
as set forth in the description under "Use of Proceeds" in the
Prospectuses, which description complies in all respects with the
requirements of Item 504 of Regulation S-K.
(n) The Company will supply you with copies of all correspondence to
and from, and all documents issued to and by the Commission, in
connection with the registration of the Stock under the Securities Act
and the Exchange Act, and the CSE, the CBF and EASDAQ, in connection
with the offer and sale of the Stock and the listing and admission to
trading of the Common Stock on the CSE and EASDAQ.
(o) Prior to each of the Closing Dates the Company will furnish to the
U.S. Representatives, as soon as they have been prepared, copies of
any unaudited interim consolidated financial statements of the Company
and its subsidiaries for any periods subsequent to the periods covered
by the financial statements appearing in the Registration Statement
and the Prospectuses.
(p) Prior to each of the Closing Dates the Company will issue no press
release or other communications directly or indirectly and hold no
press conference with respect to the Company or any of the
Subsidiaries, the financial condition, results of operations,
business, prospects, assets or liabilities of any of them, or the
offering of the Stock, without the prior written consent of XX Xxxxx.
For a period of 12 months following the first Closing Date, the
Company will provide to XX Xxxxx copies of each press release or other
public communications with respect to the financial condition, results
of operations, business, prospects, assets or liabilities of the
Company at least 24 hours prior to the public issuance thereof or such
longer advance period as may reasonably be practicable.
(q) The Company shall not invest or otherwise use the proceeds
received by the Company from its sale of the Stock in such a manner as
would require the Company or any of its subsidiaries to register as an
investment company under the Investment Company Act.
(r) The Company will not take, directly or indirectly, any action
designed to cause or result in, or that has constituted or might
reasonably be expected to constitute, the stabilization or
manipulation of the price of any securities of the Company.
6. Payment of Expenses. (a) The Company will pay (directly or by
-------------------
reimbursement) all of its costs, fees and expenses incident to the
performance of its obligations under this Agreement and the European
Underwriting Agreement and in connection with the transactions contemplated
hereby, including but not limited to (i) all expenses and taxes incident to
the issuance and delivery of the
16
U.S. Stock to the U.S. Underwriters; (ii) all expenses incident to the
registration of the Stock under the Securities Act and approval of the
Stock for offer and sale in Belgium and Denmark and such other
jurisdictions as may be requested by the European Managers; (iii) the costs
of preparing stock certificates (including printing and engraving costs);
(iv) all fees and expenses of each registrar and transfer agent of the
Stock; (v) fees and expenses of the Company's counsel and the Company's
independent accountants; (vi) all costs and expenses incurred in connection
with the preparation, printing filing, shipping and distribution of the
Registration Statement, each Pre-effective Prospectus and the Prospectuses
(including all exhibits and financial statements) and all amendments and
supplements provided for herein, the "Agreement Among U.S. Underwriters"
between the U.S. Representatives and the U.S. Underwriters, the
"Intersyndicate Agreement" between the U.S. Representatives and European
Representatives, the Master Selected Dealers' Agreement, the U.S.
Underwriters' Questionnaire and the Blue Sky memoranda (including related
fees and expenses of counsel to the U.S. Underwriters) and this Agreement;
(vii) all filing fees, attorneys' fees and expenses incurred by the Company
or the U.S. Underwriters in connection with exemptions from the qualifying
or registering (or obtaining qualification or registration of) all or any
part of the Stock for offer and sale and determination of its eligibility
for investment under the Blue Sky or other securities laws of such
jurisdictions as the U.S. Representatives may designate; (viii) all fees
and expenses paid or incurred in connection with filings made with the
NASD; (ix) fees and expenses associated with listing the Common Stock on
the CSE and admission to trading on EASDAQ, and filing with the CBF; and
(x) all other costs and expenses incident to the performance of its
obligations hereunder which are not otherwise specifically provided for in
this Section.
(b) In addition to its other obligations under Section 7(a) hereof, the
Company agrees that, as an interim measure during the pendency of any
claim, action, investigation, inquiry or other proceeding arising out of or
based upon (i) any statement or omission, or any alleged statement or
omission, in the Registration Statement or the Prospectuses, (ii) any act
or failure to act or any alleged act or failure to act or (iii) any breach
or inaccuracy in its representations and warranties, it will reimburse each
U.S. Underwriter on a quarterly basis upon written request to the Company
for all reasonable legal or other expenses incurred in connection with
investigating or defending any such claim, action, investigation, inquiry
or other proceeding, notwithstanding the absence of a judicial
determination as to the Company's obligation to reimburse each U.S.
Underwriter (and, to the extent applicable, each officer, director or
controlling person of such U.S. Underwriter) for such expenses and the
possibility that such payments might later be held to have been improper by
a court of competent jurisdiction. To the extent that any such interim
reimbursement payment is so held to have been improper, each U.S.
Underwriter shall promptly return it to the Company together with interest,
compounded daily, determined on the basis of the prime rate (or other
commercial lending rate for borrowers of the highest credit standing)
announced from time to timed by The Chase Manhattan Bank, New York, New
York (the "Prime Rate"). Any such interim reimbursement payments which are
not made to a U.S. Underwriter in a timely manner as provided below shall
bear interest at the Prime Rate from the due date for such reimbursement.
This expense reimbursement agreement will be in addition to any other
liability which the Company may otherwise have.
(c) In addition to its other obligations under Section 7(b) hereof, each
U.S. Underwriter severally agrees that, as an interim measure during the
pendency of any claim, action, investigation, inquiry or other proceeding
arising out of or based upon any statement or omission, or any alleged
statement or omission, described in Section 7(b) hereof which relates to
information furnished to the Company pursuant to Section 7(b) hereof, it
will reimburse the Company (and, to the extent applicable, each officer,
director or controlling person of the Company) on a quarterly basis upon
written request to such U.S. Underwriter for all reasonable legal or other
expenses incurred in connection with investigating or defending any such
claim, action, investigation, inquiry or other proceeding, notwithstanding
the absence of a judicial determination of such U.S. Underwriter's
obligation to reimburse the Company (and, to the extent
17
applicable, each officer, director or controlling person of the Company)
for such expenses and the possibility that such payments might later be
held to have been improper by a court of competent jurisdiction. To the
extent that any such interim reimbursement payment is so held to have been
improper, the Company (and, to the extent applicable, each officer,
director or controlling person of the Company) shall promptly return it to
such U.S. Underwriter together with interest, compounded daily, determined
on the basis of the Prime Rate. Any such interim reimbursement payments
which are not made to the Company within 30 days of a request for
reimbursement shall bear interest at the Prime Rate from the date of such
request. This indemnity agreement will be in addition to any liability
which such U.S. Underwriter may otherwise have.
(d) It is agreed that any controversy arising out of the operation of the
interim reimbursement arrangements set forth in paragraph (b) and/or (c) of
this Section 6, including the timing and amounts of any requested
reimbursement payments and the method of determining such amounts, shall be
settled by arbitration conducted under the following provisions. Any such
arbitration must be commenced by service of a written demand for
arbitration or written notice of intention to arbitrate. Upon commencement,
each party shall select one arbitrator, and the two arbitrators so selected
shall together select a mutually satisfactory third arbitrator. The three
arbitrators shall determine the procedures that they shall follow in
arbitrating the controversy arising out of the operation of the interim
reimbursement arrangements set forth in paragraph (b) and/or (c) of this
Section 6 in respect of which such arbitrators were selected. Any such
arbitration would be limited to the operation of the interim reimbursement
provisions contained in paragraph (b) and/or (c) of this Section 6 and
would not resolve the ultimate propriety or enforceability of the
obligation to reimburse expenses which is created by the provisions of
Section 7. Any payments which are the subject of any pending arbitration
proceeding under this Section 6(d) shall be suspended until such matter is
resolved in accordance with this Section 6(d) or by a court of competent
jurisdiction.
7. Indemnification and Contribution. (a) The Company agrees to indemnify and
--------------------------------
hold harmless each U.S. Underwriter and each person, if any, who controls
such U.S. Underwriter within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act and the respective officers,
directors, partners, employees, representatives and agents of each of such
U.S. Underwriter (collectively, the "U.S. Underwriter Indemnified Parties"
and, each, a "U.S. Underwriter Indemnified Party"), against any losses,
claims, damages, liabilities or expenses (including the reasonable cost of
investigating and defending against any claims therefor and counsel fees
incurred in connection therewith), joint or several, which may be based
upon the Securities Act, or any other statute or at common law, (i) on the
ground or alleged ground that any Pre-effective Prospectus, the
Registration Statement or the Prospectuses (or any Pre-effective
Prospectus, the Registration Statement or the Prospectuses as from time to
time amended or supplemented) includes or allegedly includes an untrue
statement of a material fact or omits to state a material fact required to
be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading,
unless such statement or omission was made in reliance upon, and in
conformity with, written information furnished to the Company by any U.S.
Underwriter, directly or through the U.S. Representatives, specifically for
use in the preparation thereof or (ii) for any act or failure to act or any
alleged act, or failure to act, by any U.S. Underwriter in connection with,
or relating in any manner to, any loss, claim, damage, liability or expense
referred to in clause (i) above; provided that the Company shall not be
liable under this clause (i) with respect to a prospectus delivered by a
U.S. Underwriter after the Company has given notice pursuant to Section
5(c) above that such prospectus is being amended by the Company; and
provided, further, that the Company shall not be liable under this clause
(ii) to the extent that it is determined in a final judgment by a court of
competent jurisdiction that such loss, claim, damage, or liability or
expense resulted directly from any such acts or failures to act undertaken
or omitted to be taken by such U.S. Underwriter through its gross
negligence or willful misconduct; provided, however, that in no case is the
Company to be liable with respect to any claims made against any U.S.
Underwriter Indemnified
18
Party against whom the action is brought unless such U.S. Underwriter
Indemnified Party shall have not notified the Company in writing within a
reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon the U.S.
Underwriter Indemnified Party, but failure to notify the Company of such
claim shall not relieve it from any liability which it may have to any U.S.
Underwriter Indemnified Party otherwise than on account of its indemnity
agreement contained in this paragraph. The Company will be entitled to
participate at its own expense in the defense or, if it so elects, to
assume the defense of any suit brought to enforce any such liability, but
if the Company elects to assume the defense, such defense shall be
conducted by counsel chosen by it and reasonably acceptable to the U.S.
Underwriters. In the event the Company elects to assume the defense of any
such suit and retain such counsel, any U.S. Underwriter Indemnified Party,
defendant or defendants in the suit, may retain additional counsel but
shall bear the fees and expenses of such counsel unless (i) the Company
shall have specifically authorized the retaining of such counsel or (ii)
the parties to such suit include such U.S. Underwriter Indemnified Party,
and the Company and such U.S. Underwriter Indemnified Party have been
advised by counsel to the U.S. Underwriters that one or more legal defenses
at law or in equity may be available to it or them which may not be
available to the Company, in which case the Company shall bear the
reasonable fees and expenses of one counsel for the U.S. Underwriters. In
the event that the Company must bear the fees and expenses of counsel to a
U.S. Underwriter Indemnified Party under clause (ii) of the foregoing
sentence, the Company shall not be entitled to assume the defense of such
suit notwithstanding its obligation to bear the fees and expenses of such
counsel. The Company Indemnified Party against whom indemnity may be sought
shall not be liable to indemnify any person for any settlement of any such
claim effected without the Company's consent. This indemnity agreement is
not exclusive and is in addition to any liability which the Company might
otherwise have and shall not limit any rights or remedies which may
otherwise be available at law or in equity to each U.S. Underwriter
Indemnified Party.
(b) Each U.S. Underwriter severally and not jointly agrees to indemnify and
hold harmless the Company, each of its directors, each of its officers who
have signed the Registration Statement and each person, if any, who
controls the Company within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act (collectively, the "Company Indemnified
Parties" and, each, a "Company Indemnified Party") against any losses,
claims, damages, liabilities or expenses (including, unless the U.S.
Underwriter or U.S. Underwriters elect to assume the defense, the
reasonable cost of investigating and defending against any claims therefor
and counsel fees incurred in connection therewith), joint or several, which
arise out of or are based in whole or in part upon the Securities Act, the
Exchange Act, the rules and regulations thereunder or any other statute at
common law, on the ground or alleged ground that any Pre-effective
Prospectuses, the Registration Statement or the Prospectuses (or any Pre-
effective Prospectuses, the Registration Statement or the Prospectuses, as
from time to time amended and supplemented) includes an untrue statement of
a material fact or omits to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of
the circumstances in which they were made, not misleading, but only insofar
as any such statement or omission was made in reliance upon, and in
conformity with, written information furnished to the Company by such U.S.
Underwriter, directly or through the U.S. Representatives, specifically for
use in the preparation thereof; provided, however, that in no case is such
U.S. Underwriter to be liable with respect to any claims made against any
Company Indemnified Party against whom the action is brought unless such
Company Indemnified Party shall have notified such U.S. Underwriter in
writing within a reasonable time after the summons or other first legal
process giving information of the nature of the claim shall have been
served upon the Company Indemnified Party, but failure to notify such U.S.
Underwriter of such claim shall not relieve it from any liability which it
may have to any Company Indemnified Party otherwise than on account of its
indemnity agreement contained in this paragraph. Such U.S. Underwriter
shall be entitled to participate at its own expense in the defense, or, if
it so elects, to assume the
19
defense of any suit brought to enforce any such liability, but, if such
U.S. Underwriter elects to assume the defense, such defense shall be
conducted by counsel chosen by it. In the event that any U.S. Underwriter
elects to assume the defense of any such suit and retain such counsel, the
Company Indemnified Parties and any other U.S. Underwriter or U.S.
Underwriters or controlling person or persons, defendant or defendants in
the suit, shall bear the fees and expenses of any additional counsel
retained by them, respectively. The U.S. Underwriter against whom indemnity
may be sought shall not be liable to indemnify any person for any
settlement of any such claim effected without such U.S. Underwriter's
consent. This indemnity agreement is not exclusive and will be in addition
to any liability which such U.S. Underwriter might otherwise have and shall
not limit any rights or remedies which may otherwise be available at law or
in equity to any Company Indemnified Party.
(c) If the indemnification provided for in this Section 7 is unavailable or
insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages, liabilities or
expenses (or actions in respect thereof) referred to herein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, liabilities
or expenses (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the
one hand and the U.S. Underwriters on the other from the offering of the
Stock. If, however, the allocation provided by the immediately preceding
sentence is not permitted by applicable law, then each indemnifying party
shall contribute to such amount paid or payable by such indemnified party
in such proportion as is appropriate to reflect not only such relative
benefits but also the relative fault of the Company on the one hand and the
U.S. Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities or
expenses (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company on
the one hand and the U.S. Underwriters on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Company bear to the total underwriting
discounts and commissions received by the U.S. Underwriters, in each case
as set forth in the table on the cover page of the Prospectuses. The
relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to
information supplied by the Company or the U.S. Underwriters and the
parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Company and the U.S.
Underwriters agree that it would not be just and equitable if contribution
were determined by pro rata allocation (even if the U.S. Underwriters were
treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations
referred to above. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities or expenses (or actions
in respect thereof) referred to above shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in
connection with investigating, defending, settling or compromising any such
claim. Notwithstanding the provisions of this subsection (c), no U.S.
Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the shares of the Stock
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which such U.S. Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement
or omission or alleged omission. The U.S. Underwriters' obligations to
contribute are several in proportion to their respective underwriting
obligations and not joint. 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.
8. Survival of Indemnities, Representations, Warranties, etc. The respective
---------------------------------------------------------
indemnities, covenants, agreements, representations, warranties and other
statements of the Company and the several U.S. Underwriters, as set forth
in this Agreement or made by them respectively, pursuant to this Agreement,
shall remain in full force and effect, regardless of any investigation made
by or on
20
behalf of any U.S. Underwriter, the Company or any of its officers or
directors or any controlling person, and shall survive delivery of and
payment for the Stock.
9. Conditions of U.S. Underwriters' Obligations. The respective obligations
--------------------------------------------
of the several U.S. Underwriters hereunder shall be subject to the
accuracy, at and (except as otherwise stated herein) as of the date hereof
and at and as of each of the Closing Dates, of the representations and
warranties made herein by the Company, to compliance at and as of each of
the Closing Dates by the Company with its covenants and agreements herein
contained and other provisions hereof to be satisfied at or prior to each
of the Closing Dates, and to the following additional conditions.
(a) The Registration Statement shall have become effective and no stop
order suspending the effectiveness thereof shall have been issued and no
proceedings for that purpose shall have been initiated or, to the knowledge
of the Company or the U.S. Representatives, shall be contemplated or
threatened by the Commission, and any request for additional information on
the part of the Commission (to be included in the Registration Statement or
the Prospectuses or otherwise) shall have been complied with to the
reasonable satisfaction of the U.S. Representatives and no injunction,
restraining order or order of any nature shall have been issued as of each
of the Closing Dates which would prevent the issuance of the Stock. Any
filings of the Prospectuses, or any supplement thereto, required pursuant
to Rule 424(b) or Rule 434 of the Rules and Regulations, shall have been
made in the manner and within the time period required by Rule 424(b) and
Rule 434 of the Rules and Regulations, as the case may be.
(b) The European Prospectus shall have been approved by each of the CSE,
the CBF, and EASDAQ and shall comply in all material respects with all
applicable legal requirements for use in a public offering in Belgium and
Denmark and such other jurisdictions in Europe as the European
Representatives shall have requested, and no action shall have been taken
and no proceeding shall have been initiated by the CSE, the CBF or EASDAQ
for the purpose of rescinding such approval.
(c) The U.S. Representatives shall have been satisfied that there shall
not have occurred any change, on a consolidated basis, prior to each of the
Closing Dates in the condition (financial or otherwise), properties,
business, management, prospects, net worth or results of operations of the
Company and its subsidiaries considered as a whole, or any change in the
capital stock, short-term or long-term debt of the Company and its
subsidiaries considered as a whole, such that (i) the Registration
Statement or the Prospectuses, or any amendment or supplement thereto,
contains an untrue statement of fact which, in the opinion of the U.S.
Representatives, is material, or omits to state a fact which, in the
opinion of the U.S. Representatives, is required to be stated therein or is
necessary to make the statements therein not misleading, or (ii) it is
unpracticable in the reasonable judgment of the U.S. Representatives to
proceed with the public offering or to purchase the U.S. Stock as
contemplated hereby.
(d) The U.S. Representatives shall be satisfied that no legal or
governmental action, suit or proceeding affecting the Company which is
material and adverse to the Company or which affects or may affect the
Company's ability to perform its obligations under this Agreement or the
European Underwriting Agreement shall have been instituted or threatened
and there shall have occurred no material adverse development in any such
existing action, suit or proceeding.
(e) At the time of execution of this Agreement, the U.S. Representatives
shall have received from Xxxxxx Xxxxxxxx LLP, independent certified public
accountants, a letter, dated the date hereof, in form and substance
satisfactory to the U.S. Underwriters.
(f) The U.S. Representatives shall have received from Xxxxxx Xxxxxxxx LLP,
independent certified public accountants, letters, dated each of the
Closing Dates, to the effect that such accountants reaffirm, as of each of
the Closing Dates, and as though made on each of the Closing
21
Dates, the statements made in the letter furnished by such accountants
pursuant to paragraph (e) of this Section 9.
(g) The U.S. Representatives shall have received from Xxxxxx & Dodge LLP,
counsel for the Company, opinions, dated each of the Closing Dates, to the
effect set forth in Exhibit I hereto.
(h) The U.S. Representatives shall have received from Dragsted & Xxxxxx
Xxxxxxx, Danish counsel for the Company, opinions, dated each of the
Closing Dates, in a form reasonably satisfactory to the U.S.
Representatives.
(i) The U.S. Representatives shall have received from Xxxxxx Xxxx, English
counsel for the Company, opinions, dated each of the Closing Dates, in a
form reasonably satisfactory to the U.S. Representatives.
(j) The U.S. Representatives shall have received from Xxxxxx & Xxxxxx,
U.S. patent counsel for the Company, opinions, dated each of the Closing
Dates, to the effect set forth in Exhibit II hereto.
(k) The U.S. Representatives shall have received from Ploughmann, Vingtoft
& Partners, Danish patent counsel for the Company, opinions, dated each of
the Closing Dates, to the effect set forth in Exhibit III hereto.
(l) The U.S. Representatives shall have received from Xxxxx & Wood llp,
counsel for the U.S. Underwriters, their opinions dated each of the Closing
Dates with respect to the incorporation of the Company, the validity of the
Stock, the Registration Statement and the Prospectuses (other than
financial data contained therein) and such other related matters as it may
reasonably request, and the Company shall have furnished to such counsel
such documents as they may request for the purpose of enabling them to pass
upon such matters.
(m) The U.S. Representatives shall have received from, Xxxx-Xxxxx &
Trolle, Danish counsel for the U.S. Underwriters, opinions, dated each of
the Closing Dates, in a form reasonably satisfactory to the U.S.
Representatives.
(n) The U.S. Representatives shall have received from, ________________,
English counsel for the U.S. Underwriters, opinions, dated each of the
Closing Dates, in a form reasonably satisfactory to the U.S.
Representatives.
(o) On each Closing Date, the U.S. Representatives shall have received a
certificate, dated such Closing Date, of the President and Chief Executive
Officer and the chief financial or accounting officer of the Company to the
effect that:
(i) The Registration Statement has become effective
under the Securities Act and all filings required
to have been made pursuant to Rule 424 or 430A
under the Securities Act have been made;
(ii) The European Prospectus has been approved by each
of the CBF, EASDAQ and the CSE.
(iii) None of the Commission, the CSE, the CBF, nor the
EASDAQ Market Authority, as the case may be, has
issued any stop order or equivalent order
suspending the effectiveness of the Registration
Statement or the Prospectuses, and, to the best of
the knowledge of the Company, no proceedings for
that purpose have been instituted or are pending or
contemplated by the Commission, the CSE, the CBF,
or the EASDAQ Market Authority;
22
(iv) Each such officer has carefully examined the
Registration Statement and the Prospectuses, and in
each such officer's opinion, the statements
contained in the Registration Statement and the
Prospectuses were true and correct as of their
respective dates, and none of any Pre-effective
Prospectus, as of its date, nor the Registration
Statement nor the Prospectuses or the Danish
Prospectus, nor any amendment or supplement
thereto, as of the time when the Registration
Statement became effective and the European
Prospectus was approved and at all times subsequent
thereto up to the delivery of such certificate,
included any 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, in light of the circumstances under which
they were made, not misleading;
(v) Subsequent to the respective dates as of which
information is given in the Registration Statement
and the Prospectuses, and except as set forth or
contemplated in the Prospectuses, neither the
Company nor any of its Subsidiaries has incurred
any material liabilities or obligations, direct or
contingent, or has entered into any material
transactions not in the ordinary course of business
and there has not been any material adverse change
in the condition (financial or otherwise),
properties, business, management, prospects, net
worth or results of operations of the Company and
its subsidiaries considered as a whole, and there
has not been any change in the capital stock of the
Company or any of the Subsidiaries or any change in
the short-term or long-term debt of the Company and
its subsidiaries considered as a whole;
(vi) The representations and warranties of the Company
in this Agreement are true and correct at and as of
each of the Closing Dates, and the Company has
complied with all the agreements and performed or
satisfied all the conditions on its part to be
performed or satisfied at or prior to the Closing
Dates; and
(vvi) Since the respective dates as of which information
is given in the Registration Statement and the
Prospectuses, and except as disclosed in the
Prospectuses, (i) there has not been any material
adverse change or a development involving a
material adverse change in the condition (financial
or otherwise), properties, business, management,
prospects, net worth or results of operations of
the Company and its subsidiaries considered as a
whole; (ii) the business and operations conducted
by the Company and the Subsidiaries have not
sustained a loss by strike, fire, flood, accident
or other calamity (whether or not insured) of such
a character as to interfere materially with the
conduct of the business and operations of the
Company and its subsidiaries considered as a whole;
(iii) no legal or governmental action, suit or
proceeding is pending or threatened against the
Company which is material to the Company, whether
or not arising from transactions in the ordinary
course of business, or which may materially and
adversely affect the transactions contemplated by
this Agreement or the European Underwriting
Agreement; (iv) since such dates and except as so
disclosed, the Company has not incurred any
material liability or obligation, direct,
contingent or indirect, made any change in its
capital stock (except pursuant to its stock plans),
made any material change in its short-term or
funded debt or repurchased or otherwise acquired
any of the Company's
23
capital stock; and (v) the Company has not declared
or paid any dividend, or made any other
distribution, upon its outstanding capital stock
payable to stockholders of record on a date prior
to the Closing Date.
(p) The Company shall have furnished to the U.S. Representatives such
additional certificates as the U.S. Representatives may have reasonably
requested as to the accuracy, at and as of each of the Closing Dates, of
the representations and warranties made herein by it and as to compliance
at and as of each of the Closing Dates by it with its covenants and
agreements herein contained and other provisions hereof to be satisfied at
or prior to each of the Closing Dates, and as to satisfaction of the other
conditions to the obligations of the U.S. Underwriters hereunder.
(q) XX Xxxxx shall have received the written agreements, substantially in
the form of Exhibit IV hereto, of each of the officers, directors and
holders of Common Stock, or securities convertible into or exchangeable or
exercisable for Common Stock listed in Schedule C that each of them will
not offer, sell, assign, transfer, encumber, contract to sell, grant an
option to purchase or otherwise dispose of, any shares of Common Stock
(including, without limitation, Common Stock which may be deemed to be
beneficially owned by such officer, director or holder in accordance with
the Rules and Regulations) during the 180 days following the date of the
final Prospectuses.
(r) The CSE and EASDAQ shall have approved the Common Stock for listing
and admission for trading, respectively, subject only to official notice of
issuance.
(s) Contemporaneously with the purchase by the U.S. Underwriters of the
U.S. Firm Stock under this Agreement, the European Managers shall have
purchased the European Firm Stock under the European Underwriting
Agreement.
(t) The NASD shall not have raised any objection with respect to the
fairness and reasonableness of the underwriting terms and arrangements.
All opinions, certificates, letters and other documents will be in
compliance with the provisions hereunder only if they are satisfactory in
form and substance to the U.S. Representatives. The Company will furnish
to the U.S. Representatives conformed copies of such opinions,
certificates, letters and other documents as the U.S. Representatives shall
reasonably request. If any of the conditions hereinabove provided for in
this Section 9 shall not have been satisfied when and as required by this
Agreement, this Agreement may be terminated by the U.S. Representatives by
notifying the Company of such termination in writing or by telegram at or
prior to each of the Closing Dates, but XX Xxxxx, on behalf of the U.S.
Representatives, shall be entitled to waive any of such conditions.
10. Effective Date. This Agreement shall become effective immediately as to
--------------
Sections 6, 7, 8, 10, 11,12, 14, 15, 16, 17 and 18 and, as to all other
provisions, at 11:00 a.m. New York City time on the first full business day
following the date of effectiveness of the Registration Statement or at
such earlier time after the date hereof and after the Registration
Statement becomes effective as the U.S. Representatives may determine on
and by notice to the Company or by release of any of the Stock for sale to
the public. For the purposes of this Section 10, the Stock shall be deemed
to have been so released upon the release for publication of any newspaper
advertisement relating to the Stock or upon the release by you of telegrams
(i) advising U.S. Underwriters that the shares of Stock are released for
public offering or (ii) offering the Stock for sale to securities dealers,
whichever may occur first.
11. Termination. This Agreement (except for the provisions of Section 6) may
-----------
be terminated by the Company at any time before it becomes effective in
accordance with Section 10 by notice to the
24
U.S. Representatives and may be terminated by the U.S. Representatives at
any time before it becomes effective in accordance with Section 10 by
notice to the Company. In the event of any termination of this Agreement
under this or any other provision of this Agreement, there shall be no
liability of any party to this Agreement to any other party, other than as
provided in Sections 6, 7 and 12 and other than as provided in Section 13
as to the liability of defaulting U.S. Underwriters.
This Agreement may be terminated after it becomes effective by the U.S.
Representatives by notice to the Company (i) if at or prior to the First
Closing Date trading in securities on any of the New York Stock Exchange,
American Stock Exchange, Nasdaq National Market, the CSE, or EASDAQ shall
have been suspended or minimum or maximum prices shall have been
established on any such exchange or market, or a banking moratorium shall
have been declared by New York, or United States, Danish or Belgian
authorities; (ii) trading of any securities of the Company shall have been
suspended on any exchange or in any over-the-counter market; (iii) if at or
prior to the First Closing Date there shall have been (A) an outbreak or
escalation of hostilities between any of the United States, Denmark or the
United Kingdom and any foreign power or of any other insurrection or armed
conflict involving the United States, Denmark or the United Kingdom or (B)
any change in financial markets or any calamity or crisis which, in the
judgment of the U.S. Representatives, makes it impractical or inadvisable
to offer or sell the Stock on the terms contemplated by the Prospectuses;
(iv) if there shall have been any development or prospective development
involving particularly the business or properties or securities of the
Company or any of the Subsidiaries or the transactions contemplated by this
Agreement, which, in the judgment of the U.S. Representatives, makes it
impracticable or inadvisable to offer or deliver the Stock on the terms
contemplated by the Prospectuses; (v) if there shall be any litigation or
proceeding, pending or threatened, which, in the judgment of the U.S.
Representatives, makes it impracticable or inadvisable to offer or deliver
the on the terms contemplated by the Prospectuses; or (vi) if there shall
have occurred any of the events specified in the immediately preceding
clauses (i) - (v) together with any other such event that makes it, in the
judgment of the U.S. Representatives, impractical or inadvisable to offer
or deliver the Stock on the terms contemplated by the Prospectuses.
12. Reimbursement of U.S. Underwriters. Notwithstanding any other provisions
----------------------------------
hereof, if this Agreement shall not become effective by reason of any
election of the Company pursuant to the first paragraph of Section 11 or
shall be terminated by the U.S. Representatives under Section 9 or Section
11, the Company will bear and pay the expenses specified in Section 6
hereof and, in addition to its obligations pursuant to Section 7 hereof,
the Company will reimburse the reasonable out-of-pocket expenses of the
several U.S. Underwriters (including reasonable fees and disbursements of
counsel for the U.S. Underwriters) incurred in connection with this
Agreement and the proposed purchase of the U.S. Stock, and promptly upon
demand the Company will pay such amounts to you as U.S. Representatives.
13. Substitution of U.S. Underwriters. If any U.S. Underwriter or U.S.
---------------------------------
Underwriters shall default in its or their obligations to purchase shares
of U.S. Stock hereunder and the aggregate number of shares which such
defaulting U.S. Underwriter or U.S. Underwriters agreed but failed to
purchase does not exceed ten percent (10%) of the total number of shares of
U.S. Stock underwritten, the other U.S. Underwriters shall be obligated
severally, in proportion to their respective commitments hereunder, to
purchase the shares which such defaulting U.S. Underwriter or U.S.
Underwriters agreed but failed to purchase. If any U.S. Underwriter or U.S.
Underwriters shall so default and the aggregate number of shares with
respect to which such default or defaults occur is more than ten percent
(10%) of the total number of shares of U.S. Stock underwritten and
arrangements satisfactory to the Representatives and the Company for the
purchase of such shares by other persons are not made within forty-eight
(48) hours after such default, this Agreement shall terminate.
25
If the remaining U.S. Underwriters or substituted U.S. Underwriters are
required hereby or agree to take up all or part of the shares of U.S. Stock
of a defaulting U.S. Underwriter or U.S. Underwriters as provided in this
Section 13, (i) the Company shall have the right to postpone the Closing
Dates for a period of not more than five (5) full business days in order
that the Company may effect whatever changes may thereby be made necessary
in the Registration Statement or the Prospectuses, or in any other
documents or arrangements, and the Company agrees promptly to file any
amendments to the Registration Statement or supplements to the Prospectus
which may thereby be made necessary, and (ii) the respective numbers of
shares to be purchased by the remaining U.S. Underwriters or substituted
U.S. Underwriters shall be taken as the basis of their underwriting
obligation for all purposes of this Agreement. Nothing herein contained
shall relieve any defaulting U.S. Underwriter of its liability to the
Company or the other U.S. Underwriters for damages occasioned by its
default hereunder. Any termination of this Agreement pursuant to this
Section 13 shall be without liability on the part of any non-defaulting
U.S. Underwriter or the Company, except for expenses to be paid or
reimbursed pursuant to Section 6 and except for the provisions of Section
7.
14. Notices. All communications hereunder shall be in writing and, if sent to
-------
the U.S. Underwriters shall be mailed, delivered or telegraphed and
confirmed to you, as their U.S. Representatives c/o XX Xxxxx Securities
Corporation at Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 except that
notices given to a U.S. Underwriter pursuant to Section 7 hereof shall be
sent to such U.S. Underwriter at the address furnished by the U.S.
Representatives or, if sent to the Company, shall be mailed, delivered or
telegraphed and confirmed c/o Phytera, Inc. at 000 Xxxxxxxxxx Xxxxxx,
Xxxxxxxxx , Xxxxxxxxxxxxx 00000.
15. Successors. This Agreement shall inure to the benefit of and be binding
----------
upon the several U.S. Underwriters, the Company and their respective
successors and legal representatives. Nothing expressed or mentioned in
this Agreement is intended or shall be construed to give any person other
than the persons mentioned in the preceding sentence any legal or equitable
right, remedy or claim under or in respect of this Agreement, or any
provisions herein contained, this Agreement and all conditions and
provisions hereof being intended to be and being for the sole and exclusive
benefit of such persons and for the benefit of no other person; except that
the representations, warranties, covenants, agreements and indemnities of
the Company contained in this Agreement shall also be for the benefit of
the person or persons, if any, who control any U.S. Underwriter or U.S.
Underwriters within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, and the indemnities of the several U.S.
Underwriters shall also be for the benefit of each director of the Company,
each of its officers who has signed the Registration Statement and the
person or persons, if any, who control the Company within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act.
16. Applicable Law. This Agreement shall be governed by and construed in
--------------
accordance with the laws of the State of New York.
17. Authority of the U.S. Representatives. In connection with this Agreement,
-------------------------------------
you will act for and on behalf of the several U.S. Underwriters, and any
action taken under this Agreement by Cowen, as U.S. Representative, will be
binding on all the U.S. Underwriters.
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.
19. General. This Agreement constitutes the entire agreement of the parties to
-------
this Agreement and supersedes all prior written or oral and all
contemporaneous oral agreements, understandings and
26
negotiations with respect to the subject matter hereof. In this Agreement,
the masculine, feminine and neuter genders and the singular and the plural
include one another. The section headings in this Agreement are for the
convenience of the parties only and will not affect the construction or
interpretation of this Agreement. This Agreement may be amended or
modified, and the observance of any term of this Agreement (other than the
conditions set forth in Section 9 which may be waived on behalf of the U.S.
Underwriters solely by XX Xxxxx) may be waived, only by a writing signed by
the Company and the U.S. Representatives.
20. Counterparts. 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.
27
If the foregoing correctly sets forth our understanding, please indicate
your acceptance thereof in the space provided below for that purpose, whereupon
this letter and your acceptance shall constitute a binding agreement between us.
Very truly yours,
PHYTERA, INC.
By: _________________________________
President and Chief Executive Officer
Accepted and delivered as of
the date first above written.
XX XXXXX SECURITIES CORPORATION
CARNEGIE INC.
BANCBOSTON XXXXXXXXX XXXXXXXX INC.
Acting on their own behalf
and as Representatives of the several
U.S. Underwriters referred to in the
foregoing Agreement.
By: XX XXXXX SECURITIES CORPORATION
By: ______________________________
Xxxx X. Xxxxxx
Managing Director - Syndicate
28
SCHEDULE A
Number of U.S.
Number of U.S. Firm Optional Shares to be
Name Shares to be Purchased Purchased
---- ---------------------- ---------
XX Xxxxx Securities Corporation
Carnegie Inc.
BancBoston Xxxxxxxxx Xxxxxxxx Inc.
------------ -----------
Total
============ ===========
29
SCHEDULE B
Number of European Number of European
Firm Shares to be Optional Shares to be
Name Purchased Purchased
---- --------- ---------
XX Xxxxx International X.X.
Xxxxxxxx Bank A/S
BancBoston Xxxxxxxxx Xxxxxxxx International
Ltd.
--------- --------
Total
========= ========
30
SCHEDULE C
[DIRECTORS, OFFICERS AND SHAREHOLDERS EXECUTING LOCK-UP AGREEMENTS]
31
Exhibit I
Form of Opinion of Issuer's Counsel
____________, 1998
XX Xxxxx Securities Corporation
Carnegie Inc.
BancBoston Xxxxxxxxx Xxxxxxxx Inc.
As representatives of the several
U.S. Underwriters named in Schedule A to
the U.S. Underwriting Agreement
c/o XX Xxxxx Securities Corporation
Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Phytera, Inc.
____ Shares of Common Stock
Dear Ladies and Gentlemen:
We have acted as counsel for Phytera, Inc., a Delaware corporation (the
"Company"), in connection with the sale by the Company and purchase of ____
shares of Common Stock, par value $0.01 per share, of the Company (the "U.S.
Stock") by the several U.S. Underwriters listed in Schedule A to the U.S.
Underwriting Agreement, dated _______,1999 among the Company, XX Xxxxx
Securities Corporation, Carnegie Inc. and BancBoston Xxxxxxxxx Xxxxxxxx Inc., as
U.S. Representatives of the several U.S. Underwriters named therein (the "U.S.
Underwriting Agreement"). This opinion is being furnished pursuant to Section
9(g) of the U.S. Underwriting Agreement. All capitalized terms not defined
herein shall have the meanings ascribed to them in the U.S. Underwriting
Agreement.
We are of the opinion that:
1. The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, is duly
qualified to do business and is in good standing as foreign corporation in the
Commonwealth of Massachusetts, and has all power and authority necessary to own
or hold its properties and conduct the businesses in which it is engaged;
2. The Company has an authorized capitalization as set forth in the
Prospectuses, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued, are fully paid and non-assessable
and all of the shares of Stock to be issued and sold by the Company to the U.S.
Underwriters pursuant to the U.S. Underwriting Agreement have been duly and
validly authorized and, when issued and delivered against payment therefor as
provided for in the U.S. Underwriting Agreement, shall be duly and validly
issued, fully paid and non-assessable; all of the issued shares of capital stock
of each subsidiary of the Company have been duly and validly authorized and
issued and are fully paid, non-assessable and are owned directly or indirectly
by the Company, free and clear of all liens, encumbrances, equities or claims;
and the only Subsidiaries of the Company are the Subsidiaries listed on Exhibit
21 to the Registration Statement;
32
3. All of the shares of Stock conform to the description thereof contained in
the Prospectuses; the certificates for the shares of Stock are in due and proper
form and comply with all applicable statutory requirements, with any applicable
requirements of the Certificate of Incorporation and By-Laws of the Company and
the requirements of the CSE, the CBF and EASDAQ and no holders of shares of
Stock will be subject to personal liability solely as a result of being such a
holder;
4. There are no preemptive or other rights (contractual or statutory) to
subscribe for or to purchase or to convert or exchange any obligations or
capital stock into or for, nor any restriction upon the voting or transfer of,
any of the shares of Stock pursuant to the Company's Certificate of
Incorporation or By-Laws or any agreement or other instrument as to which the
Company is bound. Except as described in or contemplated by the Prospectuses, to
our knowledge, (a) there are no outstanding securities of the Company
convertible or exchangeable into or evidencing the right to purchase or
subscribe for any shares of capital stock of the Company and (b) there are no
outstanding or authorized options, warrants or rights of any character
obligating the Company to issue any shares of its capital stock or any
securities convertible or exchangeable into or evidencing the right to purchase
or subscribe for any shares of such capital stock;
5. To the best of our knowledge without inquiry of court dockets, there are no
legal or governmental proceedings pending to which the Company or any of the
Subsidiaries is a party or of which any property or assets of the Company or any
of its Subsidiaries is the subject; and, to the best of our knowledge, no such
proceedings are threatened or contemplated by governmental authorities or other
third parties;
6. The Company and each of the Subsidiaries own or use under valid licenses all
trademarks, trademark registrations, service marks, service xxxx registrations,
trade names, copyrights, licenses, inventions, trade secrets and rights
described in the Prospectuses 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 or any of the Subsidiaries with respect to the foregoing. The
Company's business as now conducted and as proposed to be conducted does not and
will not infringe or conflict with any trademarks, service marks, trade names,
copyrights, trade secrets, licenses or other intellectual property or franchise
right of any person;
7. The Company has, and the Company as of the Closing Dates will have, good and
marketable title in fee simple to all real property and good and marketable
title to all personal property owned or proposed to be owned by it which is
material to the business of the Company, in each case free and clear of all
liens, encumbrances and defects except such as are described in the Prospectuses
or such as would in the aggregate not have a material adverse effect on the
Company and its subsidiaries considered as a whole; and any real property and
buildings held under lease by the Company or proposed to be leased after giving
effect to the transactions described in the Prospectuses are, or will be as of
each of the Closing Dates, held by it under valid, subsisting and enforceable
leases with such exceptions as would in the aggregate not have a material
adverse effect on the Company and its subsidiaries considered as a whole, in
each case except as are described in the Prospectuses;
8. The Company has full corporate power and authority to enter into the U.S.
Underwriting Agreement and to perform its obligations thereunder (including to
issue, sell and deliver the shares of Stock), and the U.S. Underwriting
Agreement has been duly and validly authorized, executed and delivered by the
Company;
9. To the best of our knowledge after due inquiry, the execution, delivery and
performance of the U.S. Underwriting Agreement and the consummation of the
transactions therein contemplated do not and will not conflict with or result in
a breach or violation of any of the terms or provisions of or constitute a
default under any indenture, mortgage, deed of trust, note agreement or other
agreement or instrument to which the Company is a party or by which it or any of
its properties is or may be bound, the Certificate of Incorporation, By-laws or
other organizational documents of the Company, or any law, order, rule or
33
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of its properties or result in the creation of a lien;
10. No consent, approval, authorization or order of any court or regulatory,
administrative or other governmental agency or body is required for the
consummation by the Company of the transactions contemplated by the U.S.
Underwriting Agreement, except such as may be required by the National
Association of Securities Dealers, Inc. (the "NASD") or under the Securities Act
or the securities or "Blue Sky" laws of any jurisdiction in connection with the
purchase and distribution of the Stock by the U.S. Underwriters;
11. The Company is in compliance with, and conducts its businesses in
conformity with, all applicable United States federal, state and local laws,
rules and regulations, and the laws, rules and regulations of other applicable
jurisdictions including, but not limited to, those relating to the protection of
human health or the environment or imposing liability or requiring standards of
conduct concerning any Hazardous Materials (as defined in the U.S. Underwriting
Agreement) and the regulations, decisions and rulings of any governmental
agency, court or tribunal; to the best of our knowledge, no prospective change
in any of such federal, state, local or foreign laws, rules or regulations has
been adopted which, when made effective, would have a material adverse effect on
the operations of the Company and its subsidiaries considered as a whole;
12. The Registration Statement was declared effective under the Securities Act
as of __________, 1999, the Prospectuses were filed with the Commission pursuant
to Rule 424(b) of the Rules and Regulations on __________, 1999, and no stop
order or equivalent order suspending the effectiveness of the Registration
Statement has been issued and no proceeding for that purpose is pending or, to
the best of our knowledge, threatened by the Commission;
13. The Registration Statement and the Prospectuses and any amendments or
supplements thereto comply as to form in all respects with the requirements of
the Securities Act and the Rules and Regulations, and if Rule 434 has been
relied upon, the Prospectuses were not "materially different," as such term is
used in Rule 434, from the prospectuses included in the Registration Statement
at the time it became effective;
14. To the best of our knowledge, there are no contracts or other documents
which are required by the Securities Act or by the Rules and Regulations to be
described in the Prospectuses or filed as exhibits to the Registration Statement
which have not been described in the Prospectuses or filed as exhibits to the
Registration Statement;
15. To the best of our knowledge, other than as described in the Prospectuses,
there are no contracts, agreements or understandings between the Company and any
person granting such person the right (other than rights which have been waived
or satisfied) to require the Company to file a registration statement under the
Securities Act with respect to any securities of the Company owned or to be
owned by such person or to require the Company to include such securities in the
securities registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration statement filed
by the Company under the Securities Act. To the best of our knowledge, no
person or entity has the right to require registration of shares of Common Stock
or other securities of the Company because of the filing or effectiveness of the
Registration Statement or otherwise, except for persons and entities who have
expressly waived such right or who have been given proper notice and have failed
to exercise such right within the time or times required under the terms and
conditions of such right;
16. The descriptions in the Registration Statement and Prospectuses of
statutes, rules, regulations, legal or governmental proceedings, contracts and
other documents are accurate and such descriptions fairly present the
information required to be disclosed; and to the best of our knowledge, there
are no legal or governmental proceedings, statutes, rules or regulations, or any
contracts or documents of a character
34
required to be described in the Registration Statement or the Prospectuses or to
be filed as exhibits to the Registration Statement which are not described and
filed as required;
17. The statements under the captions "Risk Factors -- Dependence on
Partnerships," "--Future Capital Needs; Uncertainty of Additional Funding," "--
Sourcing Agreements," "--Regulation," "Potential Liability Regarding Hazardous
Materials," "--Control by Management and Existing Stockholders," "--Dilutive
Effect of Series E Convertible Preferred stock Conversion Rate Provision," "--
Shares Eligible for Future Sale and Potential Adverse Effect on Market Price,"
"--Anti-Takeover Effect of Certain Charter and By-Law Provisions and Delaware
Law," "--Year 2000 Compliance," "Business - Corporate Partnerships," "--
Biodiversity Sourcing Agreements," "--Regulation," "--Litigation; Legal
Proceedings," "Management," "Certain Transactions," "Description of Capital
Stock," "Shares Eligible for Future Sale," and "Tax Considerations," to the
extent they reflect matters of federal law arising under the laws of the United
States or legal conclusions relating to such law, accurately summarize and
fairly present the legal and regulatory matters described therein; and
18. The Company and each of the Subsidiaries are not, nor will they be
immediately after receiving the proceeds from the sale of the Stock, 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 foregoing opinion is limited to matters governed by the Federal laws of the
United States of America, the general corporate law of the State of Delaware.
We have acted as counsel to the Company on a regular basis, have acted as
counsel to the Company in connection with previous financing transactions and
have acted as counsel to the Company in connection with the preparation and
filing of the Registration Statement and the Prospectuses, and based on the
foregoing, no facts have come to our attention which lead us to believe that the
Registration Statement or any amendment thereto, as of the Effective Date,
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements
therein not misleading, or that the Prospectuses contained or contains any
untrue statement of a material fact or omits to state a material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading.
Very truly yours,
35
Exhibit II
Form of Opinion of Issuer's U.S. Patent Counsel
____________, 1999
XX Xxxxx Securities Corporation
Carnegie Inc.
BancBoston Xxxxxxxxx Xxxxxxxx Inc.
As representatives of the several
U.S. Underwriters named in Schedule A to
the U.S. Underwriting Agreement
c/o XX Xxxxx Securities Corporation
Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Phytera, Inc.
____ Shares of Common Stock
Dear Ladies and Gentlemen:
This opinion is being delivered pursuant to Section 9(i) of the U.S.
Underwriting Agreement dated _________, 1999, among the Phytera, Inc., a
Delaware corporation (the "Company"), XX Xxxxx Securities Corporation, Carnegie
Inc. and BancBoston Xxxxxxxxx Xxxxxxxx Inc., as representatives of the several
U.S. Underwriters named therein (the "U.S. Underwriting Agreement").
We are of the opinion that:
1. The statements in the Prospectuses under the headings "Risk Factors
Dependence on Patents and Proprietary Rights" and "Business - Patents and
Proprietary Rights," "--In-Licensing Risk," in each case insofar as such
statements constitute summaries of the legal matters, documents or
proceedings referred to therein, fairly present the information called for
with respect to such legal matters, documents and proceedings and fairly
summarize the matters referred to therein.
2. We do not know of any legal or government proceedings pending relating to
patents, patent applications or intellectual property rights covering
technology of the Company described in the Prospectuses to which the
Company is a party or to which any patents, patent applications or
intellectual property rights covering technology of the Company described
in the Prospectuses are subject, which, if adversely decided, would have a
material adverse effect on the business, financial condition or results of
the operations of the Company and its subsidiaries, taken as a whole, and
we do not know of any such proceedings which are threatened or contemplated
by governmental authorities or others.
3. We are unaware of any basis for a finding that the Company does not have
clear title or valid license rights to the patents or patent applications
referenced in the Prospectuses as being owned
36
by or licensed to the Company and covering the Company's technology, and we
are of the opinion that any such patents are valid and enforceable.
4. Other than as described in the Prospectuses, based upon a review of the
third party rights made known to us and discussions with Company scientific
personnel, we are not aware of any United States patent containing any
valid claim that is or would be infringed, either literally or under the
doctrine of equivalents, by the current or proposed activities of the
Company in the use of any of the technology described in the Prospectuses,
including, without limitation, __________ and _________.
Very truly yours,
37
Exhibit III
Form of Opinion of Issuer's Danish Patent Counsel
____________, 1999
XX Xxxxx Securities Corporation
Carnegie Inc.
BancBoston Xxxxxxxxx Xxxxxxxx Inc.
As representatives of the several
U.S. Underwriters named in Schedule A to
the U.S. Underwriting Agreement
c/o XX Xxxxx Securities Corporation
Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Phytera, Inc.
____ Shares of Common Stock
Dear Ladies and Gentlemen:
This opinion is being delivered pursuant to Section 9(i) of the U.S.
Underwriting Agreement dated _________, 1999, among the Phytera, Inc., a
Delaware corporation (the "Company"), XX Xxxxx Securities Corporation, Carnegie
Inc. and BancBoston Xxxxxxxxx Xxxxxxxx Inc., as representatives of the several
U.S. Underwriters named therein (the "U.S. Underwriting Agreement").
We are of the opinion that:
1. The statements in the Prospectuses under the headings "Risk Factors -
Dependence on Patents and Proprietary Rights," "--In-Licensing Risk," and
"Business - Patents and", in each case insofar as such statements
constitute summaries of the legal matters, documents or proceedings in
Denmark or with respect to Danish law referred to therein, fairly present
the information called for with respect to such legal matters, documents
and proceedings and fairly summarize the matters referred to therein.
2. We do not know of any legal or government proceedings in Denmark or with
respect to Danish law pending relating to patents, patent applications or
intellectual property rights covering technology of the Company described
in the Prospectuses to which the Company is a party or to which any
patents, patent applications or intellectual property rights covering
technology of the Company described in the Prospectuses are subject, which,
if adversely decided, would have a material adverse effect on the business,
financial condition or results of the operations of the Company and its
subsidiaries, taken as a whole, and we do not know of any such proceedings
which are threatened or contemplated by governmental authorities or others.
3. We are unaware of any basis for a finding that the Company does not have
clear title or valid license rights to the Danish patents or patent
applications referenced in the Prospectuses as being
38
owned by or licensed to the Company and covering the Company's technology,
and we are of the opinion that any such patents are valid and enforceable
in Denmark.
4. Other than as described in the Prospectuses, based upon a review of the
third party rights made known to us and discussions with Company scientific
personnel, we are not aware of any Danish patent containing any valid claim
that is or would be infringed, either literally or under the doctrine of
equivalents, by the current or proposed activities of the Company in the
use of any of the technology described in the Prospectuses, including,
without limitation, __________ and _________.
Very truly yours,
39
Exhibit IV
Form of Lock-Up Agreement
______________, 1998
XX Xxxxx Securities Corporation
Carnegie Inc.
BancBoston Xxxxxxxxx Xxxxxxxx Inc.
As representatives of the
several U.S. Underwriters
c/o XX Xxxxx Securities Corporation
Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Phytera, Inc.
__________ Shares of Common Stock
Dear Ladies and Gentlemen:
In order to induce you and your affiliates to enter into certain underwriting
agreements with Phytera, Inc., a Delaware corporation (the "Company"), with
respect to the public offering of shares of the Company's Common Stock, par
value $0.01 per share ( the "Common Stock"), the undersigned hereby agrees that
for a period of 180 days following the date of the final prospectus filed by the
Company with the Securities and Exchange Commission in connection with such
public offering, the undersigned will not, without the prior written consent of
XX Xxxxx Securities Corporation, directly or indirectly, offer, sell, assign,
transfer, encumber, pledge, contract to sell, grant an option to purchase or
otherwise dispose of, other than by operation of law, any shares of the Common
Stock or securities convertible into or exchangeable or exercisable for shares
of the Common Stock, including, without limitation, options, warrants and the
like, which are owned of record or which may be deemed to be beneficially owned
by the undersigned in accordance with the rules and regulations promulgated
under the United States Securities Act of 1933, as the same may be amended or
supplemented from time to time (collectively, the "Securities").
Anything contained herein to the contrary notwithstanding, any person to whom
Securities are transferred from the undersigned shall be bound by the terms of
this Agreement.
In addition, the undersigned hereby waives, from the date hereof until the
expiration of the one-year period following the date of the Company's final
prospectus, any and all rights, if any, to request or demand registration
pursuant to the Securities Act of any shares of the Common Stock that are
registered in the name of the undersigned or that may be beneficially owned by
the undersigned.
In order to enable the aforesaid covenants to be enforced, the undersigned
hereby consents to the placing of legends and/or stop-transfer orders with the
transfer agent of the Common Stock with respect to any Securities.
By: _________________________________
Name:
Title:
40
