[FORM OF UNDERWRITING AGREEMENT]
2,300,000 shares of Common Stock
IgX Corp.
UNDERWRITING AGREEMENT
New York, New York
____________, 1998
Josephthal & Co. Inc.
As Representative of the
Several Underwriters listed on Schedule A hereto
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
IgX Corp., a Delaware corporation (the "Company") confirms its
agreement with Josephthal & Co. Inc. ("Josephthal") and each of the
underwriters named in Schedule A hereto (collectively, the "Underwriters"),
which term shall also include any underwriter substituted as hereinafter
provided in Section 11), for whom Josephthal is acting as representative (in
such capacity, Josephthal shall hereinafter be referred to as "you" or the
"Representative"), with respect to the sale by the Company and the purchase by
the Underwriters, acting severally and not jointly, of the respective numbers
of shares ("Shares") of the Company's common stock, $.001 par value per share
("Common Stock"), set forth in Schedule A annexed hereto. Such Shares are
hereinafter referred to as the "Firm Securities." Upon your request, as
provided in Section 2(b) of this Agreement, the Sellers shall also sell to the
Underwriters, acting severally and not jointly, up to an additional 345,000
shares of Common Stock for the purpose of covering over-allotments, if any.
Such Shares are hereinafter referred to as the "Option Securities." The
Company also proposes to issue and sell to you warrants (the "Representative's
Warrants") pursuant to the Representative's Warrant Agreement dated as of
______, 1998 between the Company and the Representative (the "Representative's
Warrant Agreement") for the purchase of an additional 230,000 shares of Common
Stock. The shares of Common Stock issuable upon exercise of the
Representative's Warrants are hereinafter referred to as the "Representative's
Securities." The Firm Securities, the Option Securities, the Representative's
Warrants and the Representative's Securities are more fully described in the
Registration Statement and the Prospectus referred to below.
1. Representations and Warranties of the Company.
The Company represents and warrants to, and agrees with, each of the
Underwriters as of the date hereof, and as of the Closing Date (as hereinafter
defined) and the Option Closing Date (as hereinafter defined), if any, as
follows:
(a) The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") a registration statement, and an
amendment or amendments thereto, on Form S-1 (No. 333-_____ ),
including any related preliminary prospectus ("Preliminary
Prospectus"), for the registration of the Firm Securities, the Option
Securities, the Representative's Warrants and the Representative's
Securities (collectively, hereinafter referred to as the
"Securities"), under the Securities Act of 1933, as amended (the
"Act"), which registration statement and amendment or amendments have
been prepared by the Company in conformity with the requirements of
the Act, and the rules and regulations (the "Regulations") of the
Commission under the Act. The Company will promptly file a further
amendment to said registration statement in the form heretofore
delivered to the Underwriters and will not file any other amendment
thereto to which the Underwriters shall have objected in writing
after having been furnished with a copy thereof. Except as the
context may otherwise require, such registration statement, as
amended, on file with the Commission at the time the registration
statement becomes effective (including the prospectus, financial
statements, schedules, exhibits and all other documents filed as a
part thereof or incorporated therein (including, but not limited to
those documents or information incorporated by reference therein) and
all information deemed to be a part thereof as of such time pursuant
to paragraph (b) of Rule 430(A) of the Regulations), is hereinafter
called the "Registration Statement", and the form of prospectus in
the form first filed with the Commission pursuant to Rule 424(b) of
the Regulations, is hereinafter called the "Prospectus." For purposes
hereof, "Rules and Regulations" mean the rules and regulations
adopted by the Commission under either the Act or the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), as applicable.
(b) Neither the Commission nor any state regulatory authority has issued
any order preventing or suspending the use of any Preliminary
Prospectus, the Registration Statement or the Prospectus or any part
of any thereof and no proceedings for a stop order suspending the
effectiveness of the Registration Statement or any of the Company's
securities have been instituted or are pending or threatened. Each of
the Preliminary Prospectus, the Registration Statement and the
Prospectus at the time of filing thereof conformed with the
requirements of the Act and the Rules and Regulations, and none of
the Preliminary Prospectus, the Registration Statement or the
Prospectus at the time of filing thereof contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein and necessary to make the statements
therein, in light of the circumstances under which they were made,
not misleading, except that this representation and warranty does not
apply to statements made in reliance upon and in conformity with
written information furnished to the Company with respect to the
Underwriters by or on behalf of the Underwriters expressly for use in
such Preliminary Prospectus, Registration Statement or Prospectus.
(c) When the Registration Statement becomes effective and at all times
subsequent thereto up to the Closing Date and each Option Closing
Date, if any, and during such longer period as the Prospectus may be
required to be delivered in connection with sales by the Underwriters
or a dealer, the Registration Statement and the Prospectus will
contain all statements which are required to be stated therein in
accordance with the Act and the
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Rules and Regulations, and will conform to the requirements of the
Act and the Rules and Regulations; neither the Registration Statement
nor the Prospectus, nor any amendment or supplement thereto, will
contain any untrue statement of a material fact or 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 this
representation and warranty does not apply to statements made or
statements omitted in reliance upon and in conformity with
information furnished to the Company with respect to the Underwriters
in writing by or on behalf of any Underwriter expressly for use in
the Preliminary Prospectus, Registration Statement or Prospectus or
any amendment thereof or supplement thereto.
(d) Each of the Company and its subsidiaries, IgX Limited, a Republic of
Ireland corporation ("IgX Ltd."), and IgX Oxford Hepatitis Corp., a
Delaware corporation, ("IgX Oxford"), has been duly organized and is
validly existing as a corporation in good standing under the laws of
the state or country of its incorporation. IgX Ltd. and IgX Oxford
are hereinafter collectively referred to as the "Subsidiaries."
Except as set forth in the Prospectus, neither the Company nor the
Subsidiaries owns an interest in any corporation, partnership, trust,
joint venture or other business entity. Each of the Company and the
Subsidiaries is duly qualified and licensed and in good standing as a
foreign corporation in each jurisdiction in which its ownership or
leasing of any properties or the character of its operations require
such qualification or licensing. The Company owns one hundred percent
(100%) of the outstanding capital stock of IgX Ltd. and __% of the
outstanding capital stock of IgX Oxford and all such shares have been
validly issued, are fully paid and non-assessable, were not issued in
violation of any preemptive rights and are owned free and clear of
any liens, charges, claims, encumbrances, pledges, security
interests, defects or other restrictions or equities of any kind
whatsoever (collectively, "Liens"). Each of the Company and the
Subsidiaries has all requisite power and authority (corporate and
other), and has obtained any and all necessary authorizations,
approvals, orders, licenses, certificates, franchises and permits of
and from all governmental or regulatory officials and bodies
(including, without limitation, those having jurisdiction over
environmental or similar matters), to own or lease its properties and
conduct its business as described in the Prospectus; each of the
Company and the Subsidiaries is and has been doing business in
compliance with all such authorizations, approvals, orders, licenses,
certificates, franchises and permits and all federal, state, local
and foreign laws, rules and regulations; and neither the Company nor
the Subsidiaries has received any notice of proceedings relating to
the revocation or modification of any such authorization, approval,
order, license, certificate, franchise, or permit which, singly or in
the aggregate, if the subject of an unfavorable decision, ruling or
finding, would materially and adversely affect the condition,
financial or otherwise, or the earnings, position, prospects, value,
operation, properties, business or results of operations of the
Company or any of the Subsidiaries. The disclosures in the
Registration Statement concerning the effects of federal, state,
local, and foreign laws, rules and regulations on each of the
Company's and the Subsidiaries' businesses as currently conducted and
as contemplated are correct in all respects and do not omit to state
a material fact necessary to make the statements contained therein
not misleading in light of the circumstances in which they were made.
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(e) The Company has a duly authorized, issued and outstanding
capitalization as set forth in the Prospectus, under "Capitalization"
and "Description of Capital Stock" and will have the adjusted
capitalization set forth therein on the Closing Date and the Option
Closing Date, if any, based upon the assumptions set forth therein,
and neither the Company nor any of the Subsidiaries is a party to or
bound by any instrument, agreement or other arrangement providing for
it to issue any capital stock, rights, warrants, options or other
securities, except for this Agreement and as described in the
Prospectus. The Securities and all other securities issued or
issuable by the Company conform or, when issued and paid for, will
conform, in all respects to all statements with respect thereto
contained in the Registration Statement and the Prospectus. All
issued and outstanding securities of the Company and the Subsidiaries
have been duly authorized and validly issued and are fully paid and
non-assessable and the holders thereof have no rights of rescission
with respect thereto, and are not subject to personal liability by
reason of being such holders; and none of such securities were issued
in violation of the preemptive rights of any holders of any security
of the Company or similar contractual rights granted by the Company
or any of the Subsidiaries. The Securities are not and will not be
subject to any preemptive or other similar rights of any stockholder,
have been duly authorized and, when issued, paid for and delivered in
accordance with the terms hereof, will be validly issued, fully paid
and nonassessable and will conform to the description thereof
contained in the Prospectus; the holders thereof will not be subject
to any liability solely as such holders; all corporate action
required to be taken for the authorization, issue and sale of the
Securities has been duly and validly taken; and the certificates
representing the Securities will be in due and proper form. Upon the
issuance and delivery pursuant to the terms hereof of the Securities
to be sold by the Company hereunder, the Underwriters or the
Representative, as the case may be, will acquire good and marketable
title to such Securities free and clear of any Lien, of any kind
whatsoever.
(f) The consolidated financial statements of the Company and the
Subsidiaries, together with the related notes and schedules thereto,
included in the Registration Statement, each Preliminary Prospectus
and the Prospectus fairly present the consolidated financial
position, income, changes in cash flow, changes in stockholders'
equity and the results of operations of the Company and the
Subsidiaries at the respective dates and for the respective periods
to which they apply and such financial statements have been prepared
in conformity with generally accepted accounting principles and the
Rules and Regulations, consistently applied throughout the periods
involved. The pro forma financial statements and other pro forma
financial information (including the notes thereto) included in the
Registration Statement and the Prospectus (A) present fairly, in all
material respects, the information shown therein, (B) have been
prepared, in all material respects, in accordance with the applicable
requirements of Rule 11-02 of Regulation S-X promulgated under the
Exchange Act, (C) have been prepared in accordance with the
Commission's rules and guidelines with respect to pro forma financial
statements, and (D) have been properly compiled on the bases
described therein, and the assumptions used in the preparation of the
pro forma financial statements and other pro forma financial
information and included in the Registration Statement and the
Prospectus are reasonable and the adjustments used therein are
appropriate to give effect to the transactions or
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circumstances referred to therein. There has been no adverse change
or development involving a material prospective change in the
condition, financial or otherwise, or in the earnings, position,
prospects, value, operation, properties, business, or results of
operation of each of the Company and the Subsidiaries, whether or not
arising in the ordinary course of business, since the date of the
financial statements included in the Registration Statement and the
Prospectus and the outstanding debt, the property, both tangible and
intangible, and the businesses of each of the Company and the
Subsidiaries conform in all respects to the descriptions thereof
contained in the Registration Statement and the Prospectus. Financial
information set forth in the Prospectus under the headings "Summary
Consolidated Financial Data", "Selected Consolidated Financial Data,"
"Capitalization," and "Management's Discussion and Analysis of
Financial Condition and Results of Operations," fairly present, on
the basis stated in the Prospectus, the information set forth
therein, have been derived from or compiled on a basis consistent
with that of the audited consolidated financial statements included
in the Prospectus.
(g) Each of the Company and the Subsidiaries (i) has paid all federal,
state, local, and foreign taxes for which it is liable, including,
but not limited to, withholding taxes and amounts payable under
Chapters 21 through 24 of the Internal Revenue Code of 1986 (the
"Code"), and has furnished all information returns it is required to
furnish pursuant to the Code, (ii) has established adequate reserves
for such taxes which are not due and payable, and (iii) does not have
any tax deficiency or claims outstanding, proposed or assessed
against it.
(h) No transfer tax, stamp duty or other similar tax is payable by or on
behalf of the Underwriters in connection with (i) the issuance by the
Company of the Securities, (ii) the purchase by the Underwriters of
the Securities from the Company and the purchase by the
Representative of the Representative's Warrants from the Company,
(iii) the consummation by the Company of any of its obligations under
this Agreement, or (iv) resales of the Securities in connection with
the distribution contemplated hereby.
(i) Each of the Company and the Subsidiaries maintains insurance
policies, including, but not limited to, general liability and
property insurance, which insures the Company, the Subsidiaries and
their respective employees, against such losses and risks generally
insured against by comparable businesses. Neither the Company nor the
Subsidiaries (A) has failed to give notice or present any insurance
claim with respect to any matter, including but not limited to the
Company's or the Subsidiaries' business, property or employees, under
any insurance policy or surety bond in a due and timely manner, (B)
has any disputes or claims against any underwriter of such insurance
policies or surety bonds or has failed to pay any premiums due and
payable thereunder, or (C) has failed to comply with all conditions
contained in such insurance policies and surety bonds. There are no
facts or circumstances under any such insurance policy or surety bond
which would relieve any insurer of its obligation to satisfy in full
any valid claim of the Company or either of the Subsidiaries.
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(j) There is no action, suit, proceeding, inquiry, arbitration,
investigation, litigation or governmental proceeding (including,
without limitation, those having jurisdiction over environmental or
similar matters), domestic or foreign, pending or threatened against
(or circumstances that may give rise to the same), or involving the
properties or business of, the Company or either of the Subsidiaries
which (i) questions the validity of the capital stock of the Company,
this Agreement or the Representative's Warrant Agreement, or of any
action taken or to be taken by the Company pursuant to or in
connection with this Agreement or the Representative's Warrant
Agreement, (ii) is required to be disclosed in the Registration
Statement which is not so disclosed (and such proceedings as are
summarized in the Registration Statement are accurately summarized in
all respects), or (iii) might materially and adversely affect the
condition, financial or otherwise, or the earnings, position,
prospects, stockholders' equity, value, operation, properties,
business or results of operations of the Company and the
Subsidiaries, taken as a whole.
(k) The Company has full legal right, power and authority to authorize,
issue, deliver and sell the Securities, and the Representative's
Securities, to enter into this Agreement and the Representative's
Warrant Agreement and to consummate the transactions provided for in
such agreements; and this Agreement and the Representative's Warrant
Agreement have each been duly and properly authorized, executed and
delivered by the Company. Each of this Agreement and the
Representative's Warrant Agreement constitutes a legal, valid and
binding agreement of the Company enforceable against the Company in
accordance with its terms, and none of the Company's issue and sale
of the Securities, or the Representative's Securities, the execution
or delivery of this Agreement or the Representative's Warrant
Agreement, its performance hereunder and thereunder, its consummation
of the transactions contemplated herein and therein, or the conduct
of its business as described in the Registration Statement, the
Prospectus, and any amendments or supplements thereto, conflicts with
or will conflict with or results or will result in any breach or
violation of any of the terms or provisions of, or constitutes or
will constitute a default under, or result in the creation or
imposition of any Lien of any kind whatsoever upon, any property or
assets (tangible or intangible) of the Company or either of the
Subsidiaries pursuant to the terms of (i) the articles of
incorporation, by-laws, memorandum of association or articles of
association of the Company or the Subsidiaries (as the case may be),
(ii) any license, contract, indenture, mortgage, deed of trust,
voting trust agreement, stockholders agreement, note, loan or credit
agreement or any other agreement or instrument to which the Company
or either of the Subsidiaries is a party or by which either of them
is or may be bound or to which either of their properties or assets
(tangible or intangible) is or may be subject, or any indebtedness,
or (iii) any statute, judgment, decree, order, rule or regulation
applicable to the Company or either of the Subsidiaries of any
arbitrator, court, regulatory body or administrative agency or other
governmental agency or body (including, without limitation, those
having jurisdiction over environmental or similar matters), domestic
or foreign, having jurisdiction over the Company or either of the
Subsidiaries or any of their respective activities or properties.
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(l) Except as described in the Prospectus, no consent, approval,
authorization or order of, and no filing with, any court, regulatory
body, government agency or other body, domestic or foreign, is
required for the issuance of the Securities pursuant to the
Prospectus and the Registration Statement, the issuance of the
Representative's Warrants, the performance of this Agreement and the
Representative's Warrant Agreement and the transactions contemplated
hereby and thereby, including without limitation, any waiver of any
preemptive, first refusal or other rights that any entity or person
may have for the issue and/or sale of any of the Securities, or the
Representative's Warrants, except such as have been or may be
obtained under the Act or may be required under state securities or
blue sky laws (collectively, "Blue Sky") in connection with the
Underwriters' purchase and distribution of the Securities, and the
Representative's Warrants to be sold by the Company hereunder.
(m) All executed agreements, contracts or other documents or copies of
executed agreements, contracts or other documents filed as exhibits
to the Registration Statement to which the Company or either of the
Subsidiaries is a party or by which any of them may be bound or to
which any of their assets, properties or businesses may be subject,
have been duly and validly authorized, executed and delivered by the
Company or the Subsidiaries and constitute the legal, valid and
binding agreements of the Company or the Subsidiaries, as the case
may be, enforceable against the Company or the Subsidiaries, as the
case may be, in accordance with their respective terms. The
descriptions in the Registration Statement of agreements, contracts
and other documents are accurate and fairly present the information
required to be shown with respect thereto by Form S-1, and there are
no contracts or other documents which are required by the Act to be
described in the Registration Statement or filed as exhibits to the
Registration Statement which are not described or filed as required,
and the exhibits which have been filed are complete and correct
copies of the documents of which they purport to be copies.
(n) Subsequent to the respective dates as of which information is set
forth in the Registration Statement and the Prospectus, and except as
may otherwise be indicated or contemplated herein or therein, neither
the Company nor the Subsidiaries has (i) issued any securities or
incurred any liability or obligation, direct or contingent, for
borrowed money, (ii) entered into any transaction other than in the
ordinary course of business consistent with past practice, or (iii)
declared or paid any dividend or made any other distribution on or in
respect of its capital stock of any class, and there has not been any
change in the capital stock, or any change in the debt (long or short
term) or liabilities or material change in or affecting the general
affairs, management, financial operations, stockholders' equity or
results of operations of the Company and the Subsidiaries taken as a
whole.
(o) No default exists in the due performance and observance of any term,
covenant or condition of any license, contract, indenture, mortgage,
installment sale agreement, lease, deed of trust, voting trust
agreement, stockholders agreement, partnership agreement, note, loan
or credit agreement, purchase order, or any other material agreement
or instrument evidencing an obligation for borrowed money, or any
other material agreement or instrument to which the Company or the
Subsidiaries is a party or by which the Company
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or the Subsidiaries may be bound or to which the property or assets
(tangible or intangible) of the Company or the Subsidiaries is
subject or affected.
(p) Each of the Company and the Subsidiaries has generally enjoyed a
satisfactory employer-employee relationship with its employees and is
in compliance with all federal, state, local, and foreign laws and
regulations respecting employment and employment practices, terms and
conditions of employment and wages and hours. There are no pending
investigations involving the Company or the Subsidiaries, by the U.S.
Department of Labor, or any other governmental agency responsible for
the enforcement of such federal, state, local, or foreign laws and
regulations. There is no unfair labor practice charge or complaint
against the Company or the Subsidiaries pending before the National
Labor Relations Board or any strike, picketing, boycott, dispute,
slowdown or stoppage pending or threatened against or involving the
Company or the Subsidiaries, or any predecessor entity, and none has
ever occurred. No representation question exists respecting the
employees of the Company or the Subsidiaries, and no collective
bargaining agreement or modification thereof is currently being
negotiated by the Company or the Subsidiaries. No grievance or
arbitration proceeding is pending under any expired or existing
collective bargaining agreements of the Company or the Subsidiaries.
No labor dispute with the employees of the Company or the
Subsidiaries exists, or is imminent.
(q) Except as described in the Prospectus, neither the Company nor any of
the Subsidiaries maintains, sponsors or contributes to any program or
arrangement that is an "employee pension benefit plan," an "employee
welfare benefit plan," or a "multiemployer plan" as such terms are
defined in Sections (2), 3(1) and 3(37), respectively, of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA")
(the foregoing are collectively, "ERISA Plans"). Neither the Company
nor any of the Subsidiaries maintains or contributes, now or at any
time previously, to a defined benefit plan, as defined in Section
3(35) of ERISA. No ERISA Plan (or any trust created thereunder) has
engaged in a "prohibited transaction" within the meaning of Section
406 of ERISA or Section 4975 of the Code, which could subject the
Company or any of the Subsidiaries to any tax penalty on prohibited
transactions and which has not adequately been corrected. Each ERISA
Plan is in compliance with all material reporting, disclosure and
other requirements of the Code and ERISA as they relate to any such
ERISA Plan. Determination letters have been received from the
Internal Revenue Service with respect to each ERISA Plan which is
intended to comply with Code Section 401(a), stating that such ERISA
Plan and the attendant trust are qualified thereunder. Neither the
Company nor any of the Subsidiaries has ever completely or partially
withdrawn from a "multiemployer plan."
(r) None of the Company, the Subsidiaries, or any of their respective
employees, directors, stockholders, partners, or affiliates (within
the meaning of the Rules and Regulations) has taken or will take,
directly or indirectly, any action designed to or which has
constituted or which might be expected to cause or result in, under
the Exchange Act, or otherwise,
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stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities or
otherwise.
(s) Except as otherwise disclosed in the Prospectus, none of the patents,
patent applications, trademarks, service marks, trade names and
copyrights, and licenses and rights to the foregoing presently owned
or held by the Company and the Subsidiaries, are in dispute so far as
known by the Company or are in any conflict with the right of any
other person or entity. To the best of the Company's knowledge, each
of the Company and the Subsidiaries (i) owns or has the right to use,
free and clear of all Liens of any kind whatsoever, all patents,
trademarks, service marks, trade names and copyrights, technology and
licenses and rights with respect to the foregoing, used in the
conduct of its business as now conducted or proposed to be conducted
without infringing upon or otherwise acting adversely to the right or
claimed right of any person, corporation or other entity under or
with respect to any of the foregoing and (ii) except as set forth in
the Prospectus, is not obligated or under any liability whatsoever to
make any payment by way of royalties, fees or otherwise to any owner
or licensee of, or other claimant to, any patent, trademark, service
xxxx, trade name, copyright, know-how, technology or other intangible
asset, with respect to the use thereof or in connection with the
conduct of its business or otherwise.
(t) Each of the Company and the Subsidiaries owns and has the
unrestricted right to use all trade secrets, know-how (including all
other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), inventions, designs, processes,
works of authorship, computer programs and technical data and
information (collectively herein "Intellectual Property") that are
material to the development, manufacture, operation and sale of all
products and services sold or proposed to be sold by any of the
Company or the Subsidiaries, free and clear of and without violating
any right, Lien, or claim of others, including without limitation,
former employers of its employees; provided, however, that the
possibility exists that other persons or entities, completely
independently of the Company or the Subsidiaries, as the case may be,
or their respective employees or agents, could have developed trade
secrets or items of technical information similar or identical to
those of the Company and the Subsidiaries. The Company is not aware
of any such development of similar or identical trade secrets or
technical information by others.
(u) Each of the Company and the Subsidiaries has taken reasonable
security measures to protect the secrecy, confidentiality and value
of all its Intellectual Property in all material aspects.
(v) Each of the Company and the Subsidiaries has good and marketable
title to, or valid and enforceable leasehold estates in, all items of
real and personal property stated in the Prospectus, to be owned or
leased by it free and clear of all Liens, of any kind whatsoever,
other than those referred to in the Prospectus and Liens for taxes
not yet due and payable.
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(w) Pricewaterhouse Coopers LLP, whose report is filed with the
Commission as a part of the Registration Statement, are independent
certified public accountants as required by the Act and the Rules and
Regulations.
(x) The Company has caused to be duly executed legally binding and
enforceable agreements pursuant to which, each of the Company's
stockholders and all holders of securities exchangeable or
exercisable for or convertible into shares of Common Stock have
agreed not to, directly or indirectly, offer to sell, sell, grant any
option for the sale of, assign, transfer, pledge, hypothecate or
otherwise encumber or dispose of any shares of Common Stock or
securities convertible into, exercisable or exchangeable for or
evidencing any right to purchase or subscribe for any shares of
Common Stock (either pursuant to Rule 144 of the Rules and
Regulations or otherwise) or dispose of any beneficial interest
therein for a period of not less than 9 months following the
effective date of the Registration Statement without the prior
written consent of the Representative. The Company will cause the
Transfer Agent, as defined below, to xxxx an appropriate legend on
the face of stock certificates representing all of such securities
and to place "stop transfer" orders on the Company's stock ledgers.
(y) There are no claims, payments, issuances, arrangements or
understandings, whether oral or written, for services in the nature
of a finder's, consulting or origination fee with respect to the sale
of the Securities hereunder or any other arrangements, agreements,
understandings, payments or issuances with respect to the Company,
the Subsidiaries or any of their respective officers, directors,
stockholders, partners, employees or affiliates that may affect the
Underwriters' compensation, as determined by the National Association
of Securities Dealers, Inc. ("NASD").
(z) The Securities have been approved for quotation on the National
Association of Securities Dealers, Inc. Automated Quotation
System/National Market ("NASDAQ-NM") .
(aa) Neither the Company nor the Subsidiaries, nor any of their respective
officers, employees, agents or any other person acting on behalf of
the Company or the Subsidiaries has, directly or indirectly, given or
agreed to give any money, gift or similar benefit (other than legal
price concessions to customers in the ordinary course of business) to
any customer, supplier, employee or agent of a customer or supplier,
or official or employee of any governmental agency (domestic or
foreign) or instrumentality of any government (domestic or foreign)
or any political party or candidate for office (domestic or foreign)
or other person who was, is, or may be in a position to help or
hinder the business of the Company or the Subsidiaries (or assist the
Company or the Subsidiaries in connection with any actual or proposed
transaction) which (a) might subject the Company or either of the
Subsidiaries, or any other such person to any damage or penalty in
any civil, criminal or governmental litigation or proceeding
(domestic or foreign), (b) if not given in the past, might have had a
materially adverse effect on the assets, business or operations of
the Company or either of the Subsidiaries, or (c) if not continued in
the future, might adversely affect the assets, business, operations
or prospects of the Company or either of the Subsidiaries. The
Company's and the Subsidiaries' internal accounting
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controls are sufficient to cause the Company and the Subsidiaries to
comply with the Foreign Corrupt Practices Act of 1977, as amended.
(ab) Except as set forth in the Prospectus, no officer, director,
stockholder or partner of the Company or the Subsidiaries, or any
"affiliate" or "associate" (as these terms are defined in Rule 405
promulgated under the Rules and Regulations) of any of the foregoing
persons or entities has or has had, either directly or indirectly (i)
an interest in any person or entity which (A) furnishes or sells
services or products which are furnished or sold or are proposed to
be furnished or sold by the Company or the Subsidiaries, or (B)
purchases from or sells or furnishes to the Company or the
Subsidiaries any goods or services, or (ii) a beneficial interest in
any contract or agreement to which the Company or either of the
Subsidiaries is a party or by which it may be bound or affected.
Except as set forth in the Prospectus under "Certain Transactions,"
there are no existing agreements, arrangements, understandings or
transactions, or proposed agreements, arrangements, understandings or
transactions, between or among the Company or the Subsidiaries, and
any officer, director, principal stockholder of the Company or the
Subsidiaries, or any partner, affiliate or associate of any of the
foregoing persons or entities.
(ac) Any certificate signed by any officer of the Company or any officer
of the Subsidiaries, and delivered to the Underwriters or to
Underwriters' Counsel (as defined herein) shall be deemed a
representation and warranty by the Company to the Underwriters as to
the matters covered thereby.
(ad) Each of the minute books of the Company and the Subsidiaries have
been made available to the Underwriters and contains a complete
summary of all meetings and actions of the directors and stockholders
of the Company and the Subsidiaries, respectively, since the time of
its respective incorporation, and reflects all transactions referred
to in such minutes accurately in all respects.
(ae) Except and to the extent described in the Prospectus or otherwise
waived, no holders of any securities of the Company or the
Subsidiaries or of any options, warrants or other convertible or
exchangeable securities of the Company or the Subsidiaries have the
right to include any securities issued by the Company or the
Subsidiaries in the Registration Statement or any registration
statement to be filed by the Company or to require the Company to
file a registration statement under the Act and no person or entity
holds any anti-dilution rights with respect to any securities of the
Company or the Subsidiaries.
(af) The Company has as of the effective date of the Registration
Statement (i) entered into an employment agreement with each of
Xxxxxx X. Xxxxxxx and Xxxxxxx X. Xxxxx in the forms filed as Exhibits
__________ and ________, respectively, to the Registration Statement,
and (ii) purchased term key-man insurance on the life of Xxxxxx X.
Xxxxx and in the amount of $3,000,000, which policy names the Company
as the sole beneficiary thereof.
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(ag) The Company will conduct its operations in a manner that will not
subject it to registration as an investment company under the
Investment Company Act of 1940, as amended, and this transaction will
not cause the Company to become an investment company subject to
registration under such Act.
(ah) All offers and sales of the Company's capital stock prior to the date
hereof, including the offer and sale of an aggregate of _______shares
of Series B Preferred Stock in connection with the 1997 Private
Placement and the 1998 Private Placement _______________ (as each
such term is defined in the Prospectus or, if the Prospectus is not
in existence, the most recent Preliminary Prospectus), were at all
relevant times exempt from the registration requirements of the Act,
and were the subject of an available exemption from the registration
requirements of all applicable state securities or blue sky laws; and
the Confidential Private Placement Memorandum, dated as of
____________, 1997 and the Confidential Private Placement Memorandum,
dated as of ____________, 1998, delivered to potential investors in
connection with the 1997 Private Placement and the 1998 Private
Placement, respectively, did not include any untrue statement of a
material fact or omit to state any material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
(ai) The clinical trials and the human and animal studies conducted by or
on behalf of the Company or in which the Company has participated
that are described in the Prospectus (or, if the Prospectus is not in
existence, the most recent Preliminary Prospectus) were and, if still
pending, are being conducted in accordance with standard medical and
scientific research procedures, and the Company has operated and
currently is in compliance in all respects with all applicable laws
and regulations, including without limitation, all United States Food
and Drug Administration rules, regulations and policies.
(aj) The Company has not received and is not aware of any communication
(written or oral) relating to the termination or modification of any
of the agreements described or referred to in the Prospectus (or, if
the Prospectus is not in existence, the most recent Preliminary
Prospectus) under the caption "Business -Patents and Proprietary
Rights," the termination or modification of which would have a
material adverse effect on the Company.
2. Purchase, Sale and Delivery of the Securities and Representative's
Warrants.
(a) On the basis of the representations, warranties, covenants and
agreements herein contained, but subject to the terms and conditions
herein set forth, the Company agrees to sell to each Underwriter, and
each Underwriter, severally and not jointly, agrees to purchase from
the Company at a price of $________[93% of the public offering price]
per Share, that number of Firm Securities set forth in Schedule A
opposite the name of such Underwriter, subject to such adjustment as
the Representative in its sole discretion shall make to eliminate any
sales or purchases of fractional shares, plus any additional number
of Firm Securities which such Underwriter may become obligated to
purchase pursuant to the provisions of Section 11 hereof.
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(b) In addition, on the basis of the representations, warranties,
covenants and agreements herein contained, but subject to the terms
and conditions herein set forth, the Company hereby grants an option
to the Underwriters, severally and not jointly, to purchase all or
any part of an additional 345,000 shares of Common Stock at a price
of $________ [93% of the public offering price] per Share. The option
granted hereby will expire 45 days after (i) the date the
Registration Statement becomes effective, if the Company has elected
not to rely on Rule 430A under the Rules and Regulations, or (ii) the
date of this Agreement if the Company has elected to rely upon Rule
430A under the Rules and Regulations, and may be exercised in whole
or in part from time to time only for the purpose of covering
over-allotments which may be made in connection with the offering and
distribution of the Firm Securities upon notice by the Representative
to the Company setting forth the number of Option Securities as to
which the several Underwriters are then exercising the option and the
time and date of payment and delivery for any such Option Securities.
Any such time and date of delivery (an "Option Closing Date") shall
be determined by the Representative, but shall not be later than
seven full business days after the exercise of said option, nor in
any event prior to the Closing Date, as hereinafter defined, unless
otherwise agreed upon by the Representative and the Company. Nothing
herein contained shall obligate the Underwriters to make any
over-allotments. No Option Securities shall be delivered unless the
Firm Securities shall be simultaneously delivered or shall
theretofore have been delivered as herein provided.
(c) Payment of the purchase price for, and delivery of certificates for,
the Firm Securities shall be made at the offices of the
Representative at 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, or at such other place as shall be agreed upon by the
Representative and the Company. Such delivery and payment shall be
made at 10:00 a.m. (New York City time) on _______________, 1998 or
at such other time and date as shall be agreed upon by the
Representative and the Company, but not less than three (3) nor more
than four (4) full business days after the effective date of the
Registration Statement (such time and date of payment and delivery
being herein called "Closing Date"). In addition, in the event that
any or all of the Option Securities are purchased by the
Underwriters, payment of the purchase price for, and delivery of
certificates for, such Option Securities shall be made at the above
mentioned office of the Representative or at such other place as
shall be agreed upon by the Representative and the Company on each
Option Closing Date as specified in the notice from the
Representative to the Company. Delivery of the certificates for the
Firm Securities and the Option Securities, if any, shall be made to
the Underwriters against payment by the Underwriters, severally and
not jointly, of the purchase price for the Firm Securities and the
Option Securities, if any, to the order of the Company for the Firm
Securities and the Option Securities, if any, by New York Clearing
House funds. In the event such option is exercised, each of the
Underwriters, acting severally and not jointly, shall purchase that
proportion of the total number of Option Securities then being
purchased which the number of Firm Securities set forth in Schedule A
hereto opposite the name of such Underwriter bears to the total
number of Firm Securities, subject in each case to such adjustments
as the Representative in its discretion shall make to eliminate any
sales or purchases of fractional shares. Certificates for the Firm
Securities and the Option Securities, if any,
-13-
shall be in definitive, fully registered form, shall bear no
restrictive legends and shall be in such denominations and registered
in such names as the Underwriters may request in writing at least two
(2) business days prior to the Closing Date or the relevant Option
Closing Date, as the case may be. The certificates for the Firm
Securities and the Option Securities, if any, shall be made available
to the Representative at such office or such other place as the
Representative may designate for inspection, checking and packaging
no later than 9:30 a.m. on the last business day prior to the Closing
Date or the relevant Option Closing Date, as the case may be.
(d) On the Closing Date, the Company shall issue and sell to the
Representative Representative's Warrants at a purchase price of
$.0001 per warrant, which warrants shall entitle the holders thereof
to purchase an aggregate of 230,000 shares of Common Stock. The
Representative's Warrants shall be exercisable for a period of four
(4) years commencing one (1) year from the effective date of the
Registration Statement at a price equaling one hundred twenty percent
(120%) of the public offering price of the Shares. The
Representative's Warrant Agreement and form of Warrant Certificate
shall be substantially in the form filed as Exhibit __ to the
Registration Statement. Payment for the Representative's Warrants
shall be made on the Closing Date.
3. Public Offering of the Shares. As soon after the Registration Statement
becomes effective as the Representative deems advisable, the Underwriters
shall make a public offering of the Shares (other than to residents of or in
any jurisdiction in which qualification of the Shares is required and has not
become effective) at the price and upon the other terms set forth in the
Prospectus. The Representative may from time to time increase or decrease the
public offering price after distribution of the Shares has been completed to
such extent as the Representative, in its sole discretion deems advisable. The
Underwriters may enter into one or more agreements as the Underwriters, in
each of their sole discretion, deem advisable with one or more broker-dealers
who shall act as dealers in connection with such public offering.
4. Covenants and Agreements of the Company. The Company covenants and agrees
with each of the Underwriters as follows:
(a) The Company shall use its best efforts to cause the Registration
Statement and any amendments thereto to become effective as promptly
as practicable and will not at any time, whether before or after the
effective date of the Registration Statement, file any amendment to
the Registration Statement or supplement to the Prospectus or file
any document under the Act or Exchange Act before termination of the
offering of the Shares by the Underwriters of which the
Representative shall not previously have been advised and furnished
with a copy, or to which the Representative shall have objected or
which is not in compliance with the Act, the Exchange Act or the
Rules and Regulations.
(b) As soon as the Company is advised or obtains knowledge thereof, the
Company will advise the Representative and confirm the notice in
writing (i) when the Registration Statement, as amended, becomes
effective, if the provisions of Rule 430A promulgated under the Act
will be relied upon, when the Prospectus has been filed in accordance
with
-14-
said Rule 430A and when any post-effective amendment to the
Registration Statement becomes effective, (ii) of the issuance by the
Commission of any stop order or of the initiation, or the
threatening, of any proceeding, suspending the effectiveness of the
Registration Statement or any order preventing or suspending the use
of the Preliminary Prospectus or the Prospectus, or any amendment or
supplement thereto, or the institution of proceedings for that
purpose, (iii) of the issuance by the Commission or by any state
securities commission of any proceedings for the suspension of the
qualification of any of the Securities for offering or sale in any
jurisdiction or of the initiation, or the threatening, of any
proceeding for that purpose, (iv) of the receipt of any comments from
the Commission; and (v) of any request by the Commission for any
amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information. If the
Commission or any state securities commission or authority shall
enter a stop order or suspend such qualification at any time, the
Company will make every effort to obtain promptly the lifting of such
order or suspension.
(c) The Company shall file the Prospectus (in form and substance
satisfactory to the Representative) or transmit the Prospectus by a
means reasonably calculated to result in filing with the Commission
pursuant to Rule 424(b)(1) (or, if applicable and if consented to by
the Representative, pursuant to Rule 424(b)(4)) not later than the
Commission's close of business on the earlier of (i) the second
business day following the execution and delivery of this Agreement,
and (ii) the fifth business day after the effective date of the
Registration Statement.
(d) The Company will give the Representative notice of its intention to
file or prepare any amendment to the Registration Statement
(including any post-effective amendment) or any amendment or
supplement to the Prospectus (including any revised prospectus which
the Company proposes for use by the Underwriters in connection with
the offering of the Securities which differs from the corresponding
prospectus on file at the Commission at the time the Registration
Statement becomes effective, whether or not such revised prospectus
is required to be filed pursuant to Rule 424(b) of the Rules and
Regulations), and will furnish the Representative with copies of any
such amendment or supplement a reasonable amount of time prior to
such proposed filing or use, as the case may be, and will not file
any such prospectus to which the Representative or Xxxxxxxxxxxx Xxxx
& Xxxxxxxxx ("Underwriters' Counsel"), shall object.
(e) The Company shall endeavor in good faith, in cooperation with the
Representative, at or prior to the time the Registration Statement
becomes effective, to qualify the Securities for offering and sale
under the securities laws of such jurisdictions as the Representative
may designate to permit the continuance of sales and dealings therein
for as long as may be necessary to complete the distribution, and
shall make such applications, file such documents and furnish such
information as may be required for such purpose; provided, however,
the Company shall not be required to qualify as a foreign corporation
or file a general or limited consent to service of process in any
such jurisdiction. In each jurisdiction where such qualification
shall be effected, the Company will, unless the Representative agrees
that such action is not at the time necessary or advisable, use all
-15-
reasonable efforts to file and make such statements or reports at
such times as are or may reasonably be required by the laws of such
jurisdiction to continue such qualification.
(f) During the time when a prospectus is required to be delivered under
the Act, the Company shall use all reasonable efforts to comply with
all requirements imposed upon it by the Act and the Exchange Act, as
now and hereafter amended and by the Rules and Regulations, as from
time to time in force, so far as necessary to permit the continuance
of sales of or dealings in the Securities in accordance with the
provisions hereof and the Prospectus, or any amendments or
supplements thereto. If at any time when a prospectus relating to the
Securities or the Representative's Securities is required to be
delivered under the Act, any event shall have occurred as a result of
which, in the opinion of counsel for the Company or Underwriters'
Counsel, the Prospectus, as then amended or supplemented, includes an
untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which
they were made, not misleading, or if it is necessary at any time to
amend the Prospectus to comply with the Act, the Company will notify
the Representative promptly and prepare and file with the Commission
an appropriate amendment or supplement in accordance with Section 10
of the Act, each such amendment or supplement to be satisfactory to
Underwriters' Counsel, and the Company will furnish to the
Underwriters copies of such amendment or supplement as soon as
available and in such quantities as the Underwriters may request.
(g) As soon as practicable, but in any event not later than 45 days after
the end of the 12-month period beginning on the day after the end of
the fiscal quarter of the Company during which the effective date of
the Registration Statement occurs (90 days in the event that the end
of such fiscal quarter is the end of the Company's fiscal year), the
Company shall make generally available to its security holders, in
the manner specified in Rule 158(b) of the Rules and Regulations, and
to the Representative, an earnings statement which will be in the
detail required by, and will otherwise comply with, the provisions of
Section 11(a) of the Act and Rule 158(a) of the Rules and
Regulations, which statement need not be audited unless required by
the Act, covering a period of at least 12 consecutive months after
the effective date of the Registration Statement.
(h) During a period of seven years after the date hereof, the Company
will furnish to its stockholders, as soon as practicable, annual
reports (including financial statements audited by independent public
accountants) and unaudited quarterly reports of earnings, and will
deliver to the Representative:
i) concurrently with furnishing such quarterly reports to its
stockholders, statements of income of the Company and the
Subsidiaries for each quarter in the form furnished to the
Company's stockholders and certified by the Company's
principal financial or accounting officer;
ii) concurrently with furnishing such annual reports to its
stockholders, a balance sheet of the Company and the
Subsidiaries as at the end of the preceding fiscal
-16-
year, together with statements of operations, stockholders
equity, and cash flows of the Company and the Subsidiaries
for such fiscal year, accompanied by a copy of the
certificate thereon of independent certified public
accountants;
iii) as soon as they are available, copies of all reports
(financial or other) mailed to stockholders;
iv) as soon as they are available, copies of all reports and
financial statements furnished to or filed with the
Commission, the NASD or any securities exchange;
v) every press release and every material news item or article
of interest to the financial community in respect of the
Company, the Subsidiaries or their respective affairs which
was released or prepared by or on behalf of the Company or
the Subsidiaries; and
vi) any additional information of a public nature concerning the
Company or the Subsidiaries (and any future subsidiaries) or
any of their respective businesses which the Representative
may request.
During such seven-year period, if the Company has active
subsidiaries, the foregoing financial statements will be on
a consolidated basis to the extent that the accounts of the
Company and its subsidiaries are consolidated, and will be
accompanied by similar financial statements for any
significant subsidiary which is not so consolidated.
(i) The Company will maintain a transfer agent and, if necessary under
the jurisdiction of incorporation of the Company, a Registrar (which
may be the same entity as the transfer agent) for its Common Stock.
(j) The Company will furnish or cause to be furnished to the
Representative, without charge, at such place as the Representative
may designate, copies of each Preliminary Prospectus, the
Registration Statement and any pre-effective or post-effective
amendments thereto (two of which copies will be manually signed and
will include all financial statements and exhibits), the Prospectus,
and all amendments and supplements thereto, including any prospectus
prepared after the effective date of the Registration Statement, in
each case as soon as available and in such quantities as the
Representative may request.
(k) On or before the effective date of the Registration Statement, the
Company shall provide the Representative with true copies of duly
executed, legally binding and enforceable agreements pursuant to
which for a period of nine (9) months from the effective date of the
Registration Statement, each of the Company's stockholders and all
holders of securities exchangeable or exercisable for or convertible
into shares of Common Stock, agrees that it or he or she will not
directly or indirectly, issue, offer to sell, sell, grant an option
for the sale of, assign, transfer, pledge, hypothecate or otherwise
encumber or dispose of any shares of Common Stock or securities
convertible into, exercisable or
-17-
exchangeable for or evidencing any right to purchase or subscribe for
any shares of Common Stock (either pursuant to Rule 144 of the Rules
and Regulations or otherwise) or dispose of any beneficial interest
therein without the prior written consent of the Representative
(collectively, the "Lock-up Agreements". In addition, during the nine
(9) month period commencing with the effective date of the
Registration Statement, the Company shall not, without the prior
written consent of the Representative sell, contract or offer to
sell, issue, transfer, assign, pledge, distribute, or otherwise
dispose of, directly or indirectly, any shares of Common Stock or any
securities convertible into or exchangeable or exercisable for shares
of Common Stock. On or before the Closing Date, the Company shall
deliver instructions to the Transfer Agent authorizing it to place
appropriate legends on the certificates representing the securities
subject to the Lock-up Agreements and to place appropriate stop
transfer orders on the Company's ledgers.
(l) None of the Company, the Subsidiaries, nor any of their respective
officers, directors, stockholders, nor any of their respective
affiliates (within the meaning of the Rules and Regulations) will
take, directly or indirectly, any action designed to, or which might
in the future reasonably be expected to cause or result in,
stabilization or manipulation of the price of any securities of the
Company.
(m) The Company shall apply the net proceeds from the sale of the
Securities in the manner, and subject to the conditions, set forth
under "Use of Proceeds" in the Prospectus. No portion of the net
proceeds will be used, directly or indirectly, to acquire any
securities issued by the Company or the Subsidiaries [except pursuant
to the right of first refusal with respect to securities of IgX
Oxford].
(n) The Company shall timely file all such reports, forms or other
documents as may be required (including, but not limited to, a Form
SR as may be required pursuant to Rule 463 under the Act) from time
to time, under the Act, the Exchange Act, and the Rules and
Regulations. and all such reports, forms and documents filed will
comply as to form and substance with the applicable requirements
under the Act, the Exchange Act, and the Rules and Regulations.
(o) The Company shall furnish to the Representative as early as
practicable prior to each of the date hereof, the Closing Date and
each Option Closing Date, if any, but no later than two (2) full
business days prior thereto, a copy of the latest available unaudited
interim financial statements of the Company (which in no event shall
be as of a date more than thirty (30) days prior to the date of the
Registration Statement) which have been read by the Company's
independent public accountants as stated in their letters to be
furnished pursuant to Section 6(k) hereof.
(p) The Company shall cause the Securities to be listed on NASDAQ/NM and
for a period of seven (7) years from the date hereof, use its best
efforts to maintain the NASDAQ/NM listing of the Securities to the
extent outstanding.
-18-
(q) For a period of five (5) years from the Closing Date, the Company
shall furnish to the Representative at the Company's sole expense (i)
daily consolidated transfer sheets relating to the Common Stock, (ii)
the list of holders of all of the Company's securities and (iii) a
Blue Sky "Trading Survey" for secondary sales of the Company's
securities prepared by counsel to the Company.
(r) As soon as practicable (i) but in no event more than 10 business days
before the effective date of the Registration Statement, file a Form
8-A with the Commission providing for the registration under the
Exchange Act of the Securities, and (ii) but in no event more than 30
days from the effective date of the Registration Statement, take all
necessary and appropriate actions to be included in Standard and
Poors Corporation Descriptions and Moodys OTC Manual and to continue
such inclusion for a period of not less than seven (7) years.
(s) The Company hereby agrees that it will not for a period of nine (9)
months from the effective date of the Registration Statement, adopt,
propose to adopt or otherwise permit to exist any employee, officer,
director, consultant or compensation plan or arrangement permitting
(i) the grant, issue, sale or entry into any agreement to grant,
issue or sell any option, warrant or other contract right for any
shares of Common Stock or other securities of the Company (x) at an
exercise or sale price that is less than the greater of the public
offering price of the Shares set forth herein and the fair market
value of the Common Stock on the date of grant or sale or (y) to any
of its executive officers or directors or to any holder of 5% or more
of the Common Stock; (ii) the maximum number of shares of Common
Stock or other securities of the Company purchasable at any time
pursuant to options or warrants issued by the Company to exceed
______shares; (iii) the payment for such securities with any form of
consideration other than cash, or (iv) the existence of stock
appreciation rights, phantom options or similar arrangements.
(t) Until the completion of the distribution of the Securities, the
Company shall not, without the prior written consent of the
Representative and Underwriters' Counsel, issue, directly or
indirectly any press release or other communication or hold any press
conference with respect to the Company or its activities or the
offering contemplated hereby, other than trade releases issued in the
ordinary course of the Company's business consistent with past
practices with respect to the Company's operations.
(u) For a period equal to the lesser of (i) seven (7) years from the date
hereof, and (ii) the sale to the public of the Representative's
Securities, the Company will not take any action or actions which may
prevent or disqualify the Company's use of Form S-1 (or other
appropriate form) for the registration under the Act of the
Representative's Securities.
(v) For a period of five years after the effective date of the
Registration Statement, the Representative shall have the right to
designate one (1) individual to the Board of Directors of the Company
(the "Board"). In the event the Representative shall not have
designated such individual at the time of any meeting of the Board or
such person is unavailable to serve, the Company shall notify the
Representative of each meeting of the Board. An individual selected
by the Representative shall be permitted to attend all
-19-
meetings of the Board and to receive all notices and other
correspondence and communications sent by the Company to members of
the Board. Such individual shall be reimbursed for all out-of-pocket
expenses incurred in connection with his service on, or attendance of
meetings of, the Board.
5. Payment of Expenses.
(a) The Company hereby agrees to pay on each of the Closing Date and the
Option Closing Date (to the extent not paid at the Closing Date) all
expenses and fees (other than fees of Underwriters' Counsel, except
as provided in (iv) below) incident to the performance of the
obligations of the Company under this Agreement and the
Representative's Warrant Agreement, including, without limitation,
(i) the fees and expenses of accountants and counsel for the Company,
(ii) all costs and expenses incurred in connection with the
preparation, duplication, printing (including mailing and handling
charges), filing, delivery and mailing (including the payment of
postage with respect thereto) of the Registration Statement, and the
Prospectus and any amendments and supplements thereto and the
printing, mailing (including the payment of postage with respect
thereto) and delivery of this Agreement, the Representative's Warrant
Agreement and related documents, including the cost of all copies
thereof and of the Preliminary Prospectuses and of the Prospectus and
any amendments thereof or supplements thereto supplied to the
Underwriters and such dealers as the Underwriters may request, in
quantities as herein above stated, (iii) the printing, engraving,
issuance and delivery of the Securities including, but not limited to
(x) the purchase by the Underwriters of the Securities and the
purchase by the Representative of the Representative's Warrants from
the Company, (y) the consummation by the Company of any of its
obligations under this Agreement and the Representative's Warrant
Agreement, and (z) resale of the Securities by the Underwriters in
connection with the distribution contemplated hereby, (iv) the
qualification of the Securities under state or foreign securities or
"Blue Sky" laws and determination of the status of such securities
under legal investment laws, including the costs of printing and
mailing the "Preliminary Blue Sky Memorandum", the "Supplemental Blue
Sky Memorandum" and "Legal Investments Survey," if any, and
disbursements and fees of counsel in connection therewith, (v)
advertising costs and expenses, including but not limited to costs
and expenses in connection with the "road show", information meetings
and presentations, bound volumes and prospectus memorabilia and
"tomb-stone" advertisement expenses, (vi) costs and expenses in
connection with Company counsel's due diligence investigations,
including but not limited to the fees of any independent counsel or
consultant retained, (vii) fees and expenses of the transfer agent,
registrar and custodian, (viii) the fees payable to the Commission
and the NASD, and (ix) the fees and expenses incurred in connection
with the listing of the Securities on NASDAQ/NM and any other
exchange.
(b) If this Agreement is terminated by the Underwriters in accordance
with the provisions of Section 6, Section 10 (a) or Section 12, the
Company shall reimburse and indemnify the Representative for all of
its actual out-of-pocket expenses, including the fees and
-20-
disbursements of Underwriters' Counsel, less any amounts already paid
pursuant to Section 5(d) hereof.
(c) The Company further agrees that, in addition to the expenses payable
pursuant to subsection (a) of this Section 5, it will pay to the
Representative on the Closing Date by certified or bank cashiers
check or, at the election of the Representative, by deduction from
the proceeds of the offering contemplated herein a non-accountable
expense allowance equal to one percent (1%) of the gross proceeds
received by the Company from the sale of the Firm Securities and
Option Securities, if any, and a financial advisory fee equal to one
percent (1%) of the gross proceeds received by the Company from the
sale of the Firm Securities and Option Securities, if any, $_______
of which has been paid to date.
6. Conditions of the Underwriters' Obligations. The obligations of the
Underwriters hereunder shall be subject to the continuing accuracy of the
representations and warranties of the Company herein as of the date hereof and
as of the Closing Date and each Option Closing Date, if any, as if they had
been or his made on and as of the Closing Date or each Option Closing Date, as
the case may be; the accuracy on and as of the Closing Date or Option Closing
Date, if any, of the statements of officers of the Company (where applicable)
made pursuant to the provisions hereof; and the performance by the Company on
and as of the Closing Date and each Option Closing Date, if any, of its
covenants and obligations hereunder and to the following further conditions:
(a) The Registration Statement shall have become effective not later than
12:00 A.M., New York time, on the date of this Agreement or such
later date and time as shall be consented to in writing by the
Representative, and, at the Closing Date and each Option Closing
Date, if any, no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for
that purpose shall have been instituted or shall be pending or
contemplated by the Commission and any request on the part of the
Commission for additional information shall have been complied with
to the reasonable satisfaction of Underwriters' Counsel. If the
Company has elected to rely upon Rule 430A of the Rules and
Regulations, the price of the Shares and any price-related
information previously omitted from the effective Registration
Statement pursuant to such Rule 430A shall have been transmitted to
the Commission for filing pursuant to Rule 424(b) of the Rules and
Regulations within the prescribed time period, and prior to Closing
Date the Company shall have provided evidence satisfactory to the
Representative of such timely filing, or a post-effective amendment
providing such information shall have been promptly filed and
declared effective in accordance with the requirements of Rule 430A
of the Rules and Regulations.
(b) The Representative shall not have advised the Company that the
Registration Statement, or any amendment thereto, contains an untrue
statement of fact which, in the Representative's opinion, is
material, or omits to state a fact which, in the Representative's
opinion, is material and is required to be stated therein or is
necessary to make the statements therein not misleading, or that the
Prospectus, or any supplement
-21-
thereto, contains an untrue statement of fact which, in the
Representative's opinion, is material, or omits to state a fact
which, in the Representative's opinion, is material and is required
to be stated therein or is necessary to make the statements therein,
in light of the circumstances under which they were made, not
misleading.
(c) On or prior to the Closing Date, the Representative shall have
received from Underwriters' Counsel, such opinion or opinions with
respect to the organization of the Company, the validity of the
Securities, the Representative's Warrants, the Registration
Statement, the Prospectus and other related matters as the
Representative may request and Underwriters' Counsel shall have
received such papers and information as they request to enable them
to pass upon such matters.
(d) At the Closing Date, the Underwriters shall have received the
favorable opinion of Xxxxxxx Xxxxxx & Green, P.C., counsel to the
Company and the Subsidiaries, dated the Closing Date, addressed to
the Underwriters and in form and substance satisfactory to
Underwriters ("Company Counsel"), to the effect that:
i) each of the Company and the Subsidiaries (A) has been duly
organized and is validly existing as a corporation in good
standing under the laws of its jurisdiction, (B) is duly
qualified and licensed and in good standing as a foreign
corporation in each jurisdiction in which its ownership or
leasing of any properties or the character of its operations
requires such qualification or licensing, and (C) has all
requisite power and authority (corporate and other), and has
obtained any and all necessary authorizations, approvals,
orders, licenses, certificates, franchises and permits of
and from all governmental or regulatory officials and bodies
(including, without limitation, those having jurisdiction
over environmental or similar matters), to own or lease its
properties and conduct its respective business as described
in the Prospectus; each of the Company and the Subsidiaries
is and has been doing business in compliance with all such
authorizations, approvals, orders, licenses, certificates,
franchises and permits and all foreign, federal, state and
local laws, rules and regulations; and, neither the Company
nor any of the Subsidiaries has received any notice of
proceedings relating to the revocation or modification of
any such authorization, approval, order, license,
certificate, franchise, or permit which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling
or finding, would materially adversely affect the business,
operations, condition, financial or otherwise, or the
earnings, business affairs, position, prospects, value,
operation, properties, business or results of operations of
the Company or the Subsidiaries taken as a whole. The
disclosures in the Registration Statement concerning the
effects of foreign, federal, state and local laws, rules and
regulations on the Company's business as currently conducted
and as contemplated are correct in all respects and do not
omit to state a fact necessary to make the statements
contained therein not misleading in light of the
circumstances in which they were made.
-22-
ii) the Company owns one hundred percent (100%) of the
outstanding capital stock of IgX Ltd., ___ percent (___%) of
the outstanding capital stock of IgX Oxford, and [JV with
Sintofarma]; and neither the Company nor any of the
Subsidiaries owns an interest in any other corporation,
partnership, joint venture, trust or other business entity;
iii) the Company has a duly authorized, issued and outstanding
capitalization as set forth in the Prospectus, and any
amendment or supplement thereto, under "Capitalization" and
"Description of Capital Stock", and neither the Company nor
any of the Subsidiaries is a party to or bound by any
instrument, agreement or other arrangement providing for it
to issue any capital stock, rights, warrants, options or
other securities, except for this Agreement and the
Representative's Warrant Agreement and as described in the
Prospectus. The Securities, the Representative's Warrants
and all other securities issued or issuable by the Company
conform in all respects to all statements with respect
thereto contained in the Registration Statement and the
Prospectus. All issued and outstanding securities of each of
the Company and the Subsidiaries have been duly authorized
and validly issued and are fully paid and non-assessable;
the holders thereof have no rights of rescission with
respect thereto, and are not subject to personal liability
by reason of being such holders; and none of such securities
were issued in violation of the preemptive rights of any
holders of any security of the Company or the Subsidiaries.
The Securities and the Representative's Securities to be
sold by the Company hereunder and under the Representative's
Warrant Agreement are not and will not be subject to any
preemptive or other similar rights of any stockholder, have
been duly authorized and, when issued, paid for and
delivered in accordance with the terms hereof, will be
validly issued, fully paid and non-assessable and conform to
the description thereof contained in the Prospectus; the
holders thereof will not be subject to any liability solely
as such holders; all corporate action required to be taken
for the authorization, issue and sale of the Securities and
the Representative's Securities has been duly and validly
taken; and the certificates representing the Securities and
the Representative's Warrants are in due and proper form.
The Representative's Warrants constitute valid and binding
obligations of the Company to issue and sell, upon exercise
thereof and payment therefor, the number and type of
securities of the Company called for thereby. Upon the
issuance and delivery pursuant to this Agreement of the
Securities and the Representatives Warrants to be sold by
the Company, the Underwriters and the Representative,
respectively, will acquire good and marketable title to the
Securities and Representative's Warrants free and clear of
any Lien of any kind whatsoever. No transfer tax is payable
by or on behalf of the Underwriters in connection with (A)
the issuance by the Company of the Securities, (B) the
purchase by the Underwriters and the Representative of the
Securities and the Representative's Securities,
respectively, from the Company, (C) the consummation by the
Company of any of its obligations under this Agreement or
the Representative's Warrant Agreement, or (D) resales of
the Securities in connection with the distribution
contemplated hereby.
-23-
iv) the Registration Statement is effective under the Act, and,
if applicable, filing of all pricing information has been
timely made in the appropriate form under Rule 430A, and no
stop order suspending the use of the Preliminary Prospectus,
the Registration Statement or Prospectus or any part of any
thereof or suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that
purpose have been instituted or are pending or, to the best
of such counsel's knowledge after due inquiry, threatened or
contemplated under the Act;
v) each of the Preliminary Prospectus, the Registration
Statement, and the Prospectus and any amendments or
supplements thereto (other than the financial statements and
other financial and statistical data included therein, as to
which no opinion need be rendered) comply as to form in all
material respects with the requirements of the Act and the
Rules and Regulations. Such counsel shall state that such
counsel has participated in conferences with officers and
other representatives of the Company, the Subsidiaries and
representatives of the independent public accountants for
the Company and the Subsidiaries, at which conferences such
counsel made inquiries of such officers, representatives and
accountants and discussed the contents of the Preliminary
Prospectus, the Registration Statement, the Prospectus, and
related matters were discussed and, although such counsel is
not passing upon and does not assume any responsibility for
the accuracy, completeness or fairness of the statements
contained in the Preliminary Prospectus, the Registration
Statement and Prospectus, on the basis of the foregoing, no
facts have come to the attention of such counsel which lead
them to believe that either the Registration Statement or
any amendment thereto, at the time such Registration
Statement or amendment became effective or the Preliminary
Prospectus or Prospectus or amendment or supplement thereto
as of the date of such opinion contained any untrue
statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading in light of the
circumstances in which they were made (it being understood
that such counsel need express no opinion with respect to
the financial statements and schedules and other financial
and statistical data included in the Preliminary Prospectus,
the Registration Statement or Prospectus).
vi) to the best of such counsel's knowledge after due inquiry,
(A) there are no agreements, contracts or other documents
required by the Act to be described in the Registration
Statement and the Prospectus and filed as exhibits to the
Registration Statement other than those described in the
Registration Statement (or required to be filed under the
Exchange Act if upon such filing they would be incorporated,
in whole or in part, by reference therein) and the
Prospectus and filed as exhibits thereto, and the exhibits
which have been filed are correct copies of the documents of
which they purport to be copies; (B) the descriptions in the
Registration Statement and the Prospectus and any supplement
or amendment thereto of contracts and other documents to
which the Company or any of the Subsidiaries is a party or
by which it is bound, including any document to which the
Company or any of the Subsidiaries is a party or by which it
is bound,
-24-
incorporated by reference into the Prospectus and any
supplement or amendment thereto, are accurate and fairly
represent the information required to be shown by Form S-l;
(C) there is not pending or threatened against the Company
or any of the Subsidiaries any action, arbitration, suit,
proceeding, inquiry, investigation, litigation, governmental
or other proceeding (including, without limitation, those
having jurisdiction over environmental or similar matters),
domestic or foreign, pending or threatened against (or
circumstances that may give rise to the same), or involving
the properties or business of, any of the Company or any of
the Subsidiaries which (x) is required to be disclosed in
the Registration Statement which is not so disclosed (and
such proceedings as are summarized in the Registration
Statement are accurately summarized in all respects), (y)
questions the validity of the capital stock of the Company
or any of the Subsidiaries or this Agreement or the
Representative's Warrant Agreement, or of any action taken
or to be taken by the Company pursuant to or in connection
with any of the foregoing; (D) no statute or regulation or
legal or governmental proceeding required to be described in
the Prospectus is not described as required; and (E) there
is no action, suit or proceeding pending or threatened
against or affecting the Company or any of the Subsidiaries
before any court or arbitrator or governmental body, agency
or official (or any basis thereof known to such counsel) in
which there is a reasonable possibility of an adverse
decision which may result in a material adverse change in
the condition, financial or otherwise, or the earnings,
position, prospects, stockholders equity, value, operation,
properties, business or results of operations of the Company
or any of the Subsidiaries, which could adversely affect the
present or prospective ability of the Company to perform its
obligations under this Agreement or the Representative's
Warrant Agreement or which in any manner draws into question
the validity or enforceability of this Agreement or the
Representative's Warrant Agreement.
vii) the Company has full legal right, power and authority to
enter into each of this Agreement and the Representative's
Warrant Agreement, and to consummate the transactions
provided for therein; and each of this Agreement and the
Representative's Warrant Agreement has been duly authorized,
executed and delivered by the Company. Each of this
Agreement and the Representative's Warrant Agreement,
assuming due authorization, execution and delivery by each
other party thereto, constitutes a legal, valid and binding
agreement of the Company enforceable against the Company in
accordance with its terms (except as such enforceability may
be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws of general
application relating to or affecting enforcement of
creditors' rights and the application of equitable
principles in any action, legal or equitable, and except as
rights to indemnity or contribution may be limited by
applicable law), and none of the Company's execution or
delivery of this Agreement or the Representative's Warrant
Agreement, its performance hereunder or thereunder, its
consummation of the transactions contemplated herein or
therein, or the conduct of its or the Subsidiaries'
businesses as described in the Registration Statement, the
Prospectus,
-25-
and any amendments or supplements thereto, conflicts with or
will conflict with or results or will result in any breach
or violation of any of the terms or provisions of, or
constitutes or will constitute a default under, or result in
the creation or imposition of any Lien, of any kind
whatsoever upon, any property or assets (tangible or
intangible) of the Company or of any of the Subsidiaries
pursuant to, the terms of (A) the articles of incorporation,
by-laws, memorandum of association or articles of
association of the Company or of any of the Subsidiaries (as
the case may be), (B) any license, contract, indenture,
mortgage, deed of trust, voting trust agreement,
stockholder's agreement, note, loan or credit agreement or
any other agreement or instrument to which the Company or
any of the Subsidiaries is a party or by which any of them
is or may be bound or to which any of their respective
properties or assets (tangible or intangible) is or may be
subject, or any indebtedness, or (C) any statute, judgment,
decree, order, rule or regulation applicable to the Company
or any of the Subsidiaries of any arbitrator, court,
regulatory body or administrative agency or other
governmental agency or body (including, without limitation,
those having jurisdiction over environmental or similar
matters), domestic or foreign, having jurisdiction over the
Company or any of the Subsidiaries or any of their
respective activities or properties.
viii) except as described in the Prospectus, no consent, approval,
authorization or order, and no filing with, any court,
regulatory body, government agency or other body (other than
such as may be required under Blue Sky laws, as to which no
opinion need be rendered) is required in connection with the
issuance of the Securities or the Representative's Warrants
pursuant to the Prospectus or the Registration Statement,
the issuance of the Representative's Warrants, the
performance of this Agreement and the Representative's
Warrant Agreement and the transactions contemplated hereby
and thereby;
ix) the properties and business of each of the Company and the
Subsidiaries conform to the description thereof contained in
the Registration Statement and the Prospectus; and each of
the Company and the Subsidiaries has good and marketable
title to, or valid and enforceable leasehold estates in, all
items of real and personal property stated in the Prospectus
to be owned or leased by it, in each case free and clear of
all Liens of any kind whatsoever, other than those referred
to in the Prospectus and Liens for taxes not yet due and
payable;
x) neither the Company nor any of the Subsidiaries is in breach
of, or in default under, any term or provision of any
license, contract, indenture, mortgage, installment sale
agreement, deed of trust, lease, voting trust agreement,
stockholders agreement, partnership agreement, note, loan or
credit agreement or any other agreement or instrument
evidencing any obligation for borrowed money, or any other
agreement or instrument to which the Company or any of the
Subsidiaries is a party or by which either of the Company or
any of the Subsidiaries may be bound or to which the
property or assets (tangible or
-26-
intangible) of any of the Company or any of the Subsidiaries
is subject or affected; and neither the Company nor any of
the Subsidiaries is in violation of any term or provision of
its Certificate of Incorporation, By-Laws, Memorandum of
Association or Articles of Association or in violation of
any franchise, license, permit, judgment, decree, order,
statute, rule or regulation;
xi) the statements in the Prospectus under "THE COMPANY," "RISK
FACTORS," "BUSINESS," "MANAGEMENT," "PRINCIPAL
STOCKHOLDERS," "CERTAIN TRANSACTIONS," "DESCRIPTION OF
CAPITAL STOCK," and "SHARES ELIGIBLE FOR FUTURE SALE" have
been reviewed by such counsel, and insofar as they refer to
statements of law, descriptions of statutes, licenses, rules
or regulations or legal conclusions, are correct in all
respects;
xii) the Securities have been accepted for quotation by NASDAQ/NM;
xiii) each of the Company and the Subsidiaries owns or possesses,
free and clear of all Liens and rights thereto or therein by
third parties, the requisite licenses or other rights to use
all trademarks, service marks, copyrights, service names,
trade names, patents, patent applications and licenses
necessary to conduct its business (including, without
limitation any such licenses or rights described in the
Prospectus as being owned or possessed by the Company or any
of the Subsidiaries), and to the best of such counsel's
knowledge after due inquiry, there is no claim or action by
any person pertaining to, or proceeding, pending, or
threatened, which challenges the exclusive rights of the
Company or any of the Subsidiaries with respect to any
trademarks, service marks, copyrights, service names, trade
names, patents, patent applications and licenses used in the
conduct of the Company's and the Subsidiaries' respective
businesses (including, without limitation, any such licenses
or rights described in the Prospectus as being owned or
possessed by the Company and any of the Subsidiaries); the
Company's and the Subsidiaries' current products, services
and processes do not and will not infringe on the patents
currently held by third parties; and no product, service or
process of any third party infringes on any patent currently
held by the Company or any of the Subsidiaries;
xiv) the persons listed under the caption "PRINCIPAL
STOCKHOLDERS" in the Prospectus are the respective
"beneficial owners" (as such phrase is defined in Rule 13d-3
under the Rules and Regulations) of the securities set forth
opposite their respective names thereunder as and to the
extent set forth therein;
xv) except as described in the Prospectus or otherwise waived,
no person, corporation, trust, partnership, association or
other entity has the right to include and/or register any
securities of the Company or any of the Subsidiaries in the
Registration Statement, require the Company or any of the
Subsidiaries to file any registration statement or, if
filed, to include any security in such registration
statement;
-27-
xvi) except as described in the Prospectus, there are no claims,
payments, issuances, arrangements or understandings for
services in the nature of a finders or origination fee with
respect to the sale of the Securities hereunder or financial
consulting arrangement or any other arrangements,
agreements, understandings, payments or issuances that may
affect the Underwriters' compensation, as determined by the
NASD;
xvii) assuming due execution by the parties thereto other than the
Company, the Lock-up Agreements are legal, valid and binding
obligations of the parties thereto, enforceable against the
party and any subsequent holder of the securities subject
thereto in accordance with its terms; and
xviii) except as described in the Prospectus, neither the Company
nor any of the Subsidiaries (A) maintains, sponsors or
contributes to any ERISA Plans, (B) maintains or
contributes, now or at any time previously, to a defined
benefit plan, as defined in Section 3(35) of ERISA, and (C)
has ever completely or partially withdrawn from a
"multiemployer plan".
xix) the Company is not an "investment company" under the
Investment Company Act of 1940, as amended, and consummation
of the transactions herein contemplated will not cause the
Company to become an investment company subject to
registration under such Act;
xx) all offers and sales of the Company's capital stock prior to
the date hereof, including the offer and sale of an
aggregate of _________ shares of Preferred Stock in
connection with the 1997 Private Placement and the 1998
Private Placement (as each such term is defined in the
Prospectus or, if the Prospectus is not in existence, the
most recent Preliminary Prospectus), were at all relevant
times exempt from the registration requirements of the Act,
and were the subject of an available exemption from the
registration requirements of all applicable state securities
or blue sky laws;
xxi) the Company and its Subsidiaries have operated and currently
is in compliance in all respects with all applicable laws
and regulations, including, without limitation, all United
States Food and Drug Administration rules, regulations and
policies; and
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws other than the laws of the United
States and jurisdictions in which they are admitted, to the extent
such counsel deems proper and to the extent specified in such
opinion, if at all, upon an opinion or opinions (in form and
substance satisfactory to Underwriters' Counsel) of other counsel
acceptable to Underwriters' Counsel, familiar with the applicable
laws; (B) as to matters of fact, to the extent they deem proper, on
certificates and written statements of responsible officers of the
Company or the Subsidiaries and certificates or other written
statements of officers of departments of
-28-
various jurisdictions having custody of documents respecting the
corporate existence or good standing of the Company, provided that
copies of any such statements or certificates shall be delivered to
Underwriters' Counsel, if requested. The opinion of such counsel for
the Company shall state that the opinion of any such other counsel is
in form satisfactory to such counsel and that the Representative and
they are justified in relying thereon.
(e) At the Closing Date, the Underwriters shall have received the
favorable opinion of Pillsbury Madison & Sutro LLP, patent counsel to
the Company, dated the Closing Date, addressed to the Underwriters
and in form and substance satisfactory to Underwriters' Counsel with
respect to such patent matters as Underwriters' Counsel may
reasonably require and opinions from ___________ and ___________,
regulatory consultants to the Company, dated the Closing Date,
addressed to the Underwriters and in form and substance satisfactory
to Underwriters' Counsel with respect to such regulatory and
compliance matters as Underwriters' Counsel may reasonably require.
(f) At each Option Closing Date, if any, the Underwriters shall have
received the favorable opinions of Xxxxxxx Xxxxxx & Green, P.C.,
counsel to the Company and the Subsidiaries, Pillsbury Madison &
Sutro LLP, patent counsel to the Company and the Subsidiaries, dated
the Option Closing Date, and _____________ and ____________,
regulatory consultants to the Company and the Subsidiaries, addressed
to the Underwriters and in form and substance satisfactory to
Underwriters' Counsel confirming as of each Option Closing Date the
statements made by each of _________________ and __________ and
________________ in their respective opinions delivered on the
Closing Date.
(g) On or prior to each of the Closing Date and the Option Closing Date,
if any, Underwriters' Counsel shall have been furnished such
documents, certificates and opinions as they may reasonably require
for the purpose of enabling them to review or pass upon the matters
referred to in subsection (c) of this Section 6, or in order to
evidence the accuracy, completeness or satisfaction of any of the
representations, warranties or conditions of the Company and the
Subsidiaries, or herein contained.
(h) Prior to each of the Closing Date and each Option Closing Date, if
any (i) there shall have been no adverse change or development
involving a prospective change in the condition, financial or
otherwise, prospects, stockholders equity or the business activities
of the Company or any of the Subsidiaries, whether or not in the
ordinary course of business consistent with past practice, from the
latest dates as of which such condition is set forth in the
Registration Statement and Prospectus; (ii) there shall have been no
transaction, not in the ordinary course of business, consistent with
past practice, entered into by the Company or any of the
Subsidiaries, from the latest date as of which the financial
condition of the Company and any of the Subsidiaries is set forth in
the Registration Statement and Prospectus which is adverse to the
Company or any of the Subsidiaries; (iii) neither the Company nor any
of the Subsidiaries shall be in default under any provision of any
instrument relating to any outstanding indebtedness; (iv) neither the
Company nor any of the Subsidiaries shall have issued any securities
(other than the Securities and the Representative's Warrants) or
declared or paid any dividend
-29-
or made any distribution in respect of its capital stock of any class
and there has not been any change in the capital stock or any change
in the debt (long or short term) or liabilities or obligations of the
Company or any of the Subsidiaries (contingent or otherwise); (v) no
material amount of the assets of the Company or any of the
Subsidiaries shall have been pledged or mortgaged, except as set
forth in the Registration Statement and Prospectus; (vi) no action,
suit or proceeding, at law or in equity, shall have been pending or
threatened (or circumstances giving rise to same) against the Company
or any of the Subsidiaries, or affecting any of their respective
properties or businesses, before or by any court or federal, state or
foreign commission, board or other administrative agency wherein an
unfavorable decision, ruling or finding may adversely affect the
business, operations, prospects or financial condition or income of
the Company or any of the Subsidiaries, except as set forth in the
Registration Statement and Prospectus; and (vii) no stop order shall
have been issued under the Act and no proceedings therefor shall have
been initiated, threatened or contemplated by the Commission.
(i) At each of the Closing Date and each Option Closing Date, if any, the
Underwriters shall have received a certificate of the Company signed
by the principal executive officer and by the chief financial or
chief accounting officer of the Company, dated the Closing Date or
Option Closing Date, as the case may be, to the effect that each of
such persons has carefully examined the Registration Statement, the
Prospectus and this Agreement, and that:
i) The representations and warranties of the Company and each
of the Subsidiaries in this Agreement are true and correct
as if made on and as of the Closing Date or the Option
Closing Date, as the case may be, and the Company has
complied with all agreements and covenants and satisfied all
conditions contained in this Agreement on its part to be
performed or satisfied at or prior to the Closing Date or
Option Closing Date, as the case may be;
ii) No stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued,
and no proceedings for that purpose have been instituted or
are pending or, to the best of each of such person's
knowledge after due inquiry, are contemplated or threatened
under the Act;
iii) The Registration Statement and the Prospectus and, if any,
each amendment and each supplement thereto, contain all
statements and information required to be included therein,
and none of the Registration Statement, the Prospectus nor
any amendment or supplement thereto includes any untrue
statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the
statements therein not misleading and neither the
Preliminary Prospectus or any supplement thereto 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;
and
-30-
iv) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus,
(a) neither the Company nor any of the Subsidiaries has
incurred up to and including the Closing Date or the Option
Closing Date, as the case may be, other than in the ordinary
course of its business consistent with past practice, any
material liabilities or obligations, direct or contingent;
(b) neither the Company nor any of the Subsidiaries has paid
or declared any dividends or other distributions on its
capital stock; (c) neither the Company nor any of the
Subsidiaries has entered into any transactions not in the
ordinary course of business consistent with past practice;
(d) there has not been any change in the capital stock or
long-term debt or any increase in the short-term borrowings
(other than any increase in the short-term borrowings in the
ordinary course of business consistent with past practice)
of the Company or any of the Subsidiaries; (e) neither the
Company nor any of the Subsidiaries has sustained any loss
or damage to its property or assets, whether or not insured;
(f) there is no litigation which is pending or threatened
(or circumstances giving rise to same) against the Company
or any of the Subsidiaries or any affiliated party of any of
the foregoing which is required to be set forth in an
amended or supplemented Prospectus which has not been set
forth; and (g) there has occurred no event required to be
set forth in an amended or supplemented Prospectus which has
not been set forth.
References to the Registration Statement and the Prospectus
in this subsection (i) are to such documents as amended and
supplemented at the date of such certificate.
(j) By the Closing Date, the Underwriters will have received clearance
from the NASD as to the amount of compensation allowable or payable
to the Underwriters, as described in the Registration Statement.
(k) At the time this Agreement is executed, the Underwriters shall have
received a letter, dated the date hereof, addressed to the
Underwriters in form and substance satisfactory (including the
non-material nature of the changes or decreases, if any, referred to
in clause (iii) below) in all respects to the Underwriters and
Underwriters' Counsel, from Pricewaterhouse Coopers LLP.
i) confirming that they are independent certified public
accountants with respect to the Company and the Subsidiaries
within the meaning of the Act and the applicable Rules and
Regulations;
ii) stating that it is their opinion that the consolidated
financial statements and supporting schedules of the Company
and the Subsidiaries included in the Registration Statement
comply as to form in all material respects with the
applicable accounting requirements of the Act and the Rules
and Regulations thereunder and that the Representative may
rely upon the opinion of
-31-
Pricewaterhouse Coopers LLP with respect to the financial
statements and supporting schedules included in the
Registration Statement;
iii) stating that, on the basis of a limited review which
included a reading of the latest available unaudited interim
consolidated financial statements of the Company and the
Subsidiaries (with an indication of the date of the latest
available unaudited interim financial statements), a reading
of the latest available minutes of the stockholders and
board of directors and the various committees of the boards
of directors of the Company and the Subsidiaries,
consultations with officers and other employees of the
Company and the Subsidiaries responsible for financial and
accounting matters and other specified procedures and
inquiries, nothing has come to their attention which would
lead them to believe that (A) the pro forma financial
information contained in the Registration Statement and
Prospectus does not comply as to form in all material
respects with the applicable accounting requirements of the
Act and the Rules and Regulations or is not fairly presented
in conformity with generally accepted accounting principles
applied on a basis consistent with that of the audited
consolidated financial statements of the Company or the
unaudited pro forma financial information included in the
Registration Statement, (B) the unaudited financial
statements and supporting schedules of the Company and the
Subsidiaries included in the Registration Statement do not
comply as to form in all material respects with the
applicable accounting requirements of the Act and the Rules
and Regulations or are not fairly presented in conformity
with generally accepted accounting principles applied on a
basis substantially consistent with that of the audited
consolidated financial statements of the Company and the
Subsidiaries included in the Registration Statement, or (C)
at a specified date not more than five (5) days prior to the
effective date of the Registration Statement, there has been
any change in the capital stock or long-term debt of the
Company and the Subsidiaries, or any decrease in the
stockholders' equity or net current assets or net assets of
the Company and the Subsidiaries as compared with amounts
shown in the balance sheet included in the Registration
Statement, other than as set forth in or contemplated by the
Registration Statement, or, if there was any change or
decrease, setting forth the amount of such change or
decrease, and (D) during the period from [June 30, 1998] to
a specified date not more than five (5) days prior to the
effective date of the Registration Statement, there was any
decrease in net revenues, net earnings or increase in net
earnings per common share of the Company and the
Subsidiaries, in each case as compared with the
corresponding period beginning [June 30, 1997] other than as
set forth in or contemplated by the Registration Statement,
or, if there was any such decrease, setting forth the amount
of such decrease;
iv) setting forth at a date not later than five (5) days prior
to the date of the Registration Statement, the amount of
liabilities of the Company and the Subsidiaries (including
any notes payable);
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v) stating that they have compared specific dollar amounts,
numbers of shares, percentages of revenues and earnings,
statements and other financial information pertaining to the
Company and the Subsidiaries set forth in the Prospectus in
each case to the extent that such amounts, numbers,
percentages, statements and information may be derived from
the general accounting records, including work sheets, of
the Company and the Subsidiaries and excluding any questions
requiring an interpretation by legal counsel, with the
results obtained from the application of specified readings,
inquiries and other appropriate procedures (which procedures
do not constitute an examination in accordance with
generally accepted auditing standards), set forth in the
letter and found them to be in agreement;
vi) stating that they have not during the immediately preceding
five (5) year period brought to the attention of any of the
Company's or the Subsidiaries' management any "weakness", as
defined in Statement of Auditing Standard No. 60
"Communication of Internal Control Structure Related Matters
Noted in an Audit," in any of the Company's or the
Subsidiaries' internal controls;
vii) stating that they have in addition carried out certain
specified procedures, not constituting an audit, with
respect to certain pro forma financial information which is
included in the Registration Statement and the Prospectus
and that nothing has come to their attention as a result of
such procedures that caused them to believe such unaudited
pro forma financial information does not comply in form in
all respects with the applicable accounting requirements of
Rule 11-02 of Regulation S-X or that the pro forma
adjustments have not been properly applied to the historical
amounts in the compilation of that information; and
viii) statements as to such other matters incident to the
transaction contemplated hereby as the Representative may
request.
(l) At the Closing Date and each Option Closing Date, if any, the
Underwriters shall have received from Pricewaterhouse Coopers LLP a
letter, dated as of the Closing Date or the Option Closing Date, as
the case may be, to the effect that they reaffirm the statements made
in the letter furnished pursuant to subsection (k) of this Section,
except that the specified date referred to shall be a date not more
than five days prior to the Closing Date or the Option Closing Date,
as the case may be, and, if the Company has elected to rely on Rule
430A of the Rules and Regulations, to the further effect that they
have carried out procedures as specified in clause (v) of subsection
(k) of this Section with respect to certain amounts, percentages and
financial information as specified by the Representative and deemed
to be a part of the Registration Statement pursuant to Rule 430A(b)
and have found such amounts, percentages and financial information to
be in agreement with the records specified in such clause (v).
(m) On each of the Closing Date and each Option Closing Date, if any,
there shall have been duly tendered to the Representative for the
several Underwriters' accounts the appropriate number of Securities.
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(n) No order suspending the sale of the Securities in any jurisdiction
designated by the Representative pursuant to subsection (e) of
Section 4 hereof shall have been issued on either the Closing Date or
the Option Closing Date, if any, and no proceedings for that purpose
shall have been instituted or shall be contemplated.
(o) On or before the Closing Date, the Company shall have executed and
delivered to the Representative (i) the Representative's Warrant
Agreement substantially in the form filed as Exhibit ______ to the
Registration Statement in final form and substance satisfactory to
the Representative, and (ii) the Representative's Warrants in such
denominations and to such designees as shall have been provided to
the Company.
(p) On or before Closing Date, the Securities shall have been duly
approved for quotation on NASDAQ/NM, subject to official notice of
issuance.
(q) On or before Closing Date, there shall have been delivered to the
Representative all of the Lock-up Agreements, in form and substance
satisfactory to Underwriters' Counsel.
If any condition to the Underwriters' obligations hereunder to be fulfilled
prior to or at the Closing Date or the relevant Option Closing Date, as the
case may be, is not so fulfilled, the Representative may terminate this
Agreement or, if the Representative so elects, it may waive any such
conditions which have not been fulfilled or extend the time for their
fulfillment.
7. Indemnification.
(a) The Company agrees to indemnify and hold harmless each of the
Underwriters (for purposes of this Section 7 "Underwriter" shall
include the officers, directors, stockholders, partners, employees,
agents and counsel of the Underwriter, including specifically each
person who may be substituted for an Underwriter as provided in
Section 11 hereof), and each person, if any, who controls the
Underwriter (a "controlling person") within the meaning of Section 15
of the Act or Section 20(a) of the Exchange Act, from and against any
and all losses, claims, damages, expenses or liabilities, joint or
several (and actions in respect thereof), whatsoever (including but
not limited to any and all expenses whatsoever incurred in
investigating, preparing or defending against any litigation,
commenced or threatened, or any claim whatsoever), as such are
incurred, to which the Underwriter or such controlling person may
become subject under the Act, the Exchange Act or any other statute
or at common law or otherwise or under the laws of foreign countries,
arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained (i) in any Preliminary
Prospectus, the Registration Statement or the Prospectus (as from
time to time amended and supplemented); (ii) in any post-effective
amendment or amendments or any new registration statement and
prospectus in which is included securities of the Company issued or
issuable upon exercise of the Securities; or (iii) in any application
or other document or written communication (in this Section 7
collectively called "application") executed by the Company or based
upon written information furnished by the Company in any jurisdiction
in order to qualify the Securities under the securities laws thereof
or filed with the
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Commission, any state securities commission or agency, NASDAQ/NM or
any other securities exchange; or the omission or alleged omission
therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading (in the case
of the Prospectus, in the light of the circumstances under which they
were made), unless such statement or omission was made exclusively in
reliance upon and in conformity with written information furnished to
the Company with respect to any Underwriter by or on behalf of such
Underwriter expressly for use in any Preliminary Prospectus, the
Registration Statement or Prospectus, or any amendment thereof or
supplement thereto, or in any application, as the case may be.
The indemnity agreement in this subsection (a) shall be in addition
to any liability which the Company may have at common law or
otherwise.
(b) Each of the Underwriters agrees severally, but not jointly, to
indemnify and hold harmless the Company, each of its directors, each
of its officers who has signed the Registration Statement, and each
other person, if any, who controls the Company within the meaning of
the Act, to the same extent as the foregoing indemnity from the
Company to the Underwriters but only with respect to statements or
omissions, if any, made in any Preliminary Prospectus, the
Registration Statement or Prospectus or any amendment thereof or
supplement thereto or in any application made in reliance upon, and
in strict conformity with, written information furnished to the
Company with respect to any Underwriter by such Underwriter expressly
for use in such Preliminary Prospectus, the Registration Statement or
Prospectus or any amendment thereof or supplement thereto or in any
such application, provided that such written information or omissions
only pertain to disclosures in the Preliminary Prospectus, the
Registration Statement or Prospectus directly relating to the
transactions effected by the Underwriters in connection with this
offering. The Company acknowledges that the statements with respect
to the public offering of the Securities set forth under the heading
"Underwriting" and the stabilization legend in the Prospectus have
been furnished by the Underwriters expressly for use therein and
constitute the only information furnished in writing by or on behalf
of the Underwriters for inclusion in the Prospectus.
(c) Promptly after receipt by an indemnified party under this Section 7
of notice of the commencement of any action, suit or proceeding, such
indemnified party shall, if a claim in respect thereof is to be made
against one or more indemnifying parties under this Section 7, notify
each party against whom indemnification is to be sought in writing of
the commencement thereof (but the failure so to notify an
indemnifying party shall not relieve it from any liability which it
may have under this Section 7 except to the extent that it has been
prejudiced in any material respect by such failure or from any
liability which it may have otherwise). In case any such action is
brought against any indemnified party, and it notifies an
indemnifying party or parties of the commencement thereof, the
indemnifying party or parties will be entitled to participate
therein, and to the extent it may elect by written notice delivered
to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof
with counsel reasonably satisfactory to such indemnified party.
Notwithstanding the foregoing,
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the indemnified party or parties shall have the right to employ its
or their own counsel in any such case but the fees and expenses of
such counsel shall be at the expense of such indemnified party or
parties unless (i) the employment of such counsel shall have been
authorized in writing by the indemnifying party in connection with
the defense of such action at the expense of such indemnifying party,
(ii) the indemnifying party shall not have employed counsel
reasonably satisfactory to such indemnified party to have charge of
the defense of such action within a reasonable period of time after
notice of commencement of the action, or (iii) such indemnified party
or parties shall have reasonably concluded that there may be defenses
available to it or them which are different from or additional to
those available to one or all of the indemnifying parties (in which
case the indemnifying parties shall not have the right to direct the
defense of such action on behalf of the indemnified party or
parties), in any of which events such fees and expenses of additional
counsel shall be borne by the indemnifying parties. Anything in this
Section 7 to the contrary notwithstanding, an indemnifying party
shall not be liable for any settlement of any claim or action
effected without its written consent; provided, however, that such
consent was not unreasonably withheld.
(d) In order to provide for just and equitable contribution in any case
in which (i) an indemnified party makes a claim for indemnification
pursuant to this Section 7, but it is judicially determined (by the
entry of a final judgment or decree by a court of competent
jurisdiction and the expiration of time to appeal or the denial of
the last right of appeal) that such indemnification may not be
enforced in such case notwithstanding the fact that the express
provisions of this Section 7 provide for indemnification in such
case, or (ii) contribution under the Act may be required on the part
of any indemnified party, then each indemnifying party shall
contribute to the amount paid as a result of such losses, claims,
damages, expenses or liabilities (or actions in respect thereof) (A)
in such proportion as is appropriate to reflect the relative benefits
received by each of the contributing parties, on the one hand, and
the party to be indemnified on the other hand, from the offering of
the Securities or (B) if the allocation provided by clause (A) above
is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in
clause (i) above, but also the relative fault of each of the
contributing parties, on the one hand, and the party to be
indemnified on the other hand, in connection with the statements or
omissions that resulted in such losses, claims, damages, expenses or
liabilities, as well as any other relevant equitable considerations.
In any case where the Company is a contributing party and the
Underwriters are the indemnified party, the relative benefits
received by the Company on the one hand, and the Underwriters, on the
other, shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Securities (before deducting
expenses) bear to the total underwriting discounts received by the
Underwriters hereunder, in each case as set forth in the table on the
cover page of the Prospectus. 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 by the Underwriters, and the parties' relative
intent, knowledge, access to information and opportunity to correct
or prevent such untrue statement or omission. The amount paid or
payable by an indemnified party as a result
-36-
of the losses, claims, damages, expenses or liabilities (or actions
in respect thereof) referred to above in this subdivision (d) shall
be deemed to include any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of
this subdivision (d) the Underwriters shall not be required to
contribute any amount in excess of the underwriting discount
applicable to the Securities purchased by the Underwriters hereunder.
No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls the
Company within the meaning of the Act, each officer of the Company
who has signed the Registration Statement, and each director of the
Company shall have the same rights to contribution as the Company,
subject in each case to this subparagraph (d). Any party entitled to
contribution will, promptly after receipt of notice of commencement
of any action, suit or proceeding against such party in respect to
which a claim for contribution may be made against another party or
parties under this subparagraph (d), notify such party or parties
from whom contribution may be sought, but the omission so to notify
such party or parties shall not relieve the party or parties from
whom contribution may be sought from any obligation it or they may
have hereunder or otherwise than under this subparagraph (d), or to
the extent that such party or parties were not adversely affected by
such omission. The contribution agreement set forth above shall be in
addition to any liabilities which any indemnifying party may have at
common law or otherwise.
8. Representations and Agreements to Survive Delivery. All representations,
warranties and agreements contained in this Agreement or contained in
certificates of officers of the Company submitted pursuant hereto, shall be
deemed to be representations, warranties and agreements at the Closing Date
and the Option Closing Date, as the case may be, and such representations,
warranties and agreements of the Company and the respective indemnity
agreements contained in Section 7 hereof, shall remain operative and in full
force and effect regardless of any investigation made by or on behalf of any
Underwriter, the Company, any controlling person of any Underwriter or the
Company, and shall survive termination of this Agreement or the issuance and
delivery of the Securities to the Underwriters and the Representative, as the
case may be.
9. Effective Date.
(a) This Agreement shall become effective at 10:00 a.m., New York City
time, on the next full business day following the date hereof, or at
such earlier time after the Registration Statement becomes effective
as the Representative, in its discretion, shall release the
Securities for the sale to the public; provided, however, that the
provisions of Sections 5, 7 and 10 of this Agreement shall at all
times be effective. For purposes of this Section 9, the Securities to
be purchased hereunder shall be deemed to have been so released upon
the earlier of dispatch by the Representative of telegrams to
securities dealers releasing such shares for offering or the release
by the Representative for publication of the first newspaper
advertisement which is subsequently published relating to the
Securities.
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10. Termination.
(a) Subject to subsection (b) of this Section 10, the Representative
shall have the right to terminate this Agreement if (i) any domestic
or international event or act or occurrence has disrupted, or in the
Representative's opinion will in the immediate future disrupt, the
financial markets; or (ii) any material adverse change in the
financial markets shall have occurred; or (iii) trading on the New
York Stock Exchange, the American Stock Exchange, or in the
over-the-counter market shall have been suspended, or minimum or
maximum prices for trading shall have been fixed, or maximum ranges
for prices for securities shall have been required on the
over-the-counter market by the NASD or by order of the Commission or
any other government authority having jurisdiction; or (iv) the
United States shall have become involved in a war or major
hostilities, or if there shall have been an escalation in an existing
war or major hostilities or a national emergency shall have been
declared in the United States; or (v) a banking moratorium has been
declared by a state or federal authority; or (vi) a moratorium in
foreign exchange trading has been declared; or (vii) the Company
shall have sustained a loss material or substantial to the Company by
fire, flood, accident, hurricane, earthquake, theft, sabotage or
other calamity or malicious act which, whether or not such loss shall
have been insured, will, in the Representative's opinion, make it
inadvisable to proceed with the delivery of the Securities; or (viii)
there shall have been such a material adverse change in the
conditions or prospects of the Company, or such material adverse
change in the general market, political or economic conditions, in
the United States or elsewhere as in the Representative's judgment
would make it inadvisable to proceed with the offering, sale and/or
delivery of the Securities or (ix) if [Xxxxxx X. Xxxxx] no longer
serve the Company in his present capacity.
(b) If this Agreement is terminated by the Representative in accordance
with the provisions of Section 10(a), the Company shall promptly
reimburse and indemnify the Representative for all of its actual
out-of-pocket expenses, including the fees and disbursements of
counsel for the Underwriters (less amounts previously paid pursuant
to Section 5(c) above). Notwithstanding any contrary provision
contained in this Agreement, if this Agreement shall not be carried
out within the time specified herein, or any extension thereof
granted to the Representative, by reason of any failure on the part
of the Company to perform any undertaking or satisfy any condition of
this Agreement by it to be performed or satisfied (including, without
limitation, pursuant to Section 6 or Section 12) then, the Company
shall promptly reimburse and indemnify the Representative for all of
its actual out-of-pocket expenses, including the fees and
disbursements of counsel for the Underwriters (less amounts
previously paid pursuant to Section 5(c) above). In addition, the
Company shall remain liable for all Blue Sky counsel fees and
expenses and Blue Sky filing fees. Notwithstanding any contrary
provision contained in this Agreement, any election hereunder or any
termination of this Agreement (including, without limitation,
pursuant to Sections 6, 10, 11 and 12 hereof), and whether or not
this Agreement is otherwise carried out, the provisions of Section 5
and Section 7 shall not be in any way affected by such election or
termination or failure to carry out the terms of this Agreement or
any part hereof.
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11. Substitution of the Underwriters. If one or more of the Underwriters shall
fail (otherwise than for a reason sufficient to justify the termination of
this Agreement under the provisions of Section 6, Section 10 or Section 12
hereof) to purchase the Securities which it or they are obligated to purchase
on such date under this Agreement (the "Defaulted Securities"), the
Representative shall have the right, within 24 hours thereafter, to make
arrangements for one or more of the non-defaulting Underwriters, or any other
underwriters, to purchase all, but not less than all, of the Defaulted
Securities in such amounts as may be agreed upon and upon the terms herein set
forth; if, however, the Representative shall not have completed such
arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10% of the
total number of Firm Securities to be purchased on such date, the
non-defaulting Underwriters shall be obligated to purchase the full
amount thereof in the proportions that their respective underwriting
obligations hereunder bear to the underwriting obligations of all
non-defaulting Underwriters; or
(b) if the number of Defaulted Securities exceeds 10% of the total number
of Firm Securities, this Agreement shall terminate without liability
on the part of any non-defaulting Underwriters.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of any default by such
Underwriter under this Agreement.
In the event of any such default which does not result in a
termination of this Agreement, the Representative shall have the
right to postpone the Closing Date for a period not exceeding seven
days in order to effect any required changes in the Registration
Statement or Prospectus or in any other documents or arrangements.
12. Default by the Company. If the Company shall fail at the Closing Date or
any Option Closing Date, as applicable, to sell and deliver the number of
Securities which it is obligated to sell hereunder on such date, then this
Agreement shall terminate (or, if such default shall occur with respect to any
Option Securities to be purchased on an Option Closing Date, the Underwriters'
may, at the Representative's option, by notice from the Representative to the
Company, terminate the Underwriters' obligation to purchase Option Securities
from the Company on such date) without any liability on the part of any
non-defaulting party other than pursuant to Section 5, Section 7 and Section
10 hereof. No action taken pursuant to this Section 12 shall relieve the
Company from liability, if any, in respect of such default.
13. Notices. All notices and communications hereunder, except as herein
otherwise specifically provided, shall be in writing and shall be deemed to
have been duly given if mailed or transmitted by any standard form of
telecommunication. Notices to the Underwriters shall be directed to the
Representative at Josephthal & Co. Inc., 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: __________________ with a copy to
Xxxxxxxxxxxx Xxxx & Xxxxxxxxx, 1221 Avenue of the Xxxxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx X. Xxxxxx, Esq. Notices to the Company
shall be directed to the Company at IgX Corp.,
-00-
Xxx Xxxxxxxxxxx Xxxxxx, Xxxxxx, Xxx Xxxxxx 00000, Attention: Xxxxxx X. Xxxxx,
Chief Executive Officer, with a copy to Xxxxxxx Xxxxxx & Green, P.C., 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx X. Xxxxxx, Esq.
14. Parties. This Agreement shall inure solely to the benefit of and shall be
binding upon, the Underwriters, the Company and the controlling persons,
directors and officers referred to in Section 7 hereof, and their respective
successors, legal representatives and assigns, and no other person shall have
or be construed to have any legal or equitable right, remedy or claim under or
in respect of or by virtue of this Agreement or any provisions herein
contained. No purchaser of Securities from any Underwriter shall be deemed to
be a successor by reason merely of such purchase.
15. Construction. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of New York, without giving
effect to its choice of law or conflict of laws principles.
16. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, and all of
which taken together shall be deemed to be one and the same instrument.
17. Entire Agreement; Amendments. This Agreement and the Representative's
Warrant Agreement constitute the entire agreement of the parties hereto and
supersede all prior written or oral agreements, understandings and
negotiations with respect to the subject matter hereof. This Agreement may not
be amended except in a writing, signed by the Representative and the Company.
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If the foregoing correctly sets forth the understanding between the
Underwriters and the Company, please so indicate in the space provided below
for that purpose, whereupon this letter shall constitute a binding agreement
among us.
Very truly yours,
IgX CORP.
By:
-----------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chief Executive Officer
Confirmed and accepted as of
the date first above written.
JOSEPHTHAL & CO. INC.
For itself and as Representative
of the several Underwriters named
in Schedule A hereto.
By:
-------------------------------
Name:
Title:
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Schedule A
Name of Underwriter Number of Firm Securities to be Purchased
------------------- -----------------------------------------
Josephthal & Co. Inc.
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