4,500,000 Shares1
OMP, Inc.
Common Stock
UNDERWRITING AGREEMENT
____________, 2001
CIBC World Markets Corp.
Xxxxxx Xxxxxx Partners LLC
U.S. Bancorp Xxxxx Xxxxxxx Inc.
c/o CIBC World Markets Corp.
Xxx Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
On behalf of the Several
Underwriters named on
Schedule I attached hereto.
Ladies and Gentlemen:
OMP, Inc., a Delaware corporation (the "Company"), proposes,
subject to the terms and conditions contained herein, to sell to you and the
other underwriters named on Schedule I to this Agreement (the "Underwriters"),
for whom you are acting as Representatives (the "Representatives"), an aggregate
of 4,500,000 shares (the "Firm Shares") of the Company's Common Stock, $0.001
par value (the "Common Stock"). The respective amounts of the Firm Shares to be
purchased by each of the several Underwriters are set forth opposite their names
on Schedule I. In addition, the Company proposes to grant to the Underwriters an
option to purchase up to an additional 675,000 shares (the "Option Shares") of
Common Stock for the purpose of covering over-allotments in connection with the
sale of the Firm Shares. The Firm Shares and the Option Shares are together
called the "Shares."
As part of the offering contemplated by this Agreement, the
Representatives have agreed to reserve out of the Firm Shares purchased by them
up to 225,000 shares (the "Directed Shares") for sale to the Company's
directors, officers, employees and other parties associated with the Company
(each, individually a "Participant" and collectively, the "Participants") under
the terms of the friends and family directed sales program (the "Friends and
Family Program"). Shares to be sold pursuant to the Friends and Family Program
shall be sold pursuant to this Agreement at the public offering price. Any
Directed Shares not orally confirmed for purchase by a Participant by 10:00 a.m.
New York time on the date immediately following the date of this
-------------
1 Plus an option to purchase up to 675,000 additional shares to cover
over-allotments.
1
Agreement will be offered to the public by the Representatives as set forth in
the Prospectus (as such term is hereinafter defined).
1. SALE AND PURCHASE OF THE SHARES.
On the basis of the representations, warranties and agreements
contained in, and subject to the terms and conditions of, this Agreement:
(a) The Company agrees to sell to each of the Underwriters,
and each of the Underwriters agrees, severally and not jointly, to purchase from
the Company, at a price of $_____ per share (the "Initial Price"), the number of
Firm Shares set forth opposite the name of such Underwriter under the column
"Number of Firm Shares to be Purchased from the Company" on Schedule I to this
Agreement, subject to adjustment in accordance with Section 10 hereof.
(b) The Company grants to the several Underwriters an option
to purchase, severally and not jointly, all or any part of the Option Shares at
the Initial Price. The number of Option Shares to be purchased by each
Underwriter shall be the same percentage (adjusted by the Representatives to
eliminate fractions) of the total number of Option Shares to be purchased by the
Underwriters as such Underwriter is purchasing of the Firm Shares. Such option
may be exercised only to cover over-allotments in the sales of the Firm Shares
by the Underwriters and may be exercised in whole or in part at any time on or
before 12:00 noon, New York City time, on the business day before the Firm
Shares Closing Date (as defined below), and from time to time thereafter within
30 days after the date of this Agreement, in each case upon written, facsimile
or telegraphic notice, or verbal or telephonic notice confirmed by written,
facsimile or telegraphic notice, by the Representatives to the Company no later
than 12:00 noon, New York City time, on the business day before the Firm Shares
Closing Date or at least two business days before the Option Shares Closing Date
(as defined below), as the case may be, setting forth the number of Option
Shares to be purchased and the time and date (if other than the Firm Shares
Closing Date) of such purchase.
2. DELIVERY AND PAYMENT. Delivery by the Company of the Firm
Shares to the Representatives for the respective accounts of the Underwriters,
and payment of the purchase price by certified or official bank check or checks
payable in New York Clearing House (same day) funds drawn to the order of the
Company for the shares purchased from the Company, against delivery of the
respective certificates therefor to the Representatives, shall take place at the
offices of Shearman & Sterling, 000 Xxxxxxxxxx Xxxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx
00000, at 10:00 a.m., New York City time, on the third business day following
the date of this Agreement, or at such time on such other date, not later than
10 business days after the date of this Agreement, as shall be agreed upon by
the Company and the Representatives (such time and date of delivery and payment
are called the "Firm Shares Closing Date").
In the event the option with respect to the Option Shares is
exercised in whole or in part on one or more occasions, delivery by the Company
of the Option Shares to the Representatives for the respective accounts of the
Underwriters and payment of the purchase price thereof in immediately available
funds by wire transfer or by certified or official bank check
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or checks payable in New York Clearing House (same day) funds to the Company
shall take place at the offices of Shearman & Sterling specified above at the
time and on the date (which may be the same date as, but in no event shall be
earlier than, the Firm Shares Closing Date) specified in the notice referred to
in Section 1(b) (such time and date of delivery and payment are called the
"Option Shares Closing Date"). The Firm Shares Closing Date and the Option
Shares Closing Date are called, individually, a "Closing Date" and, together,
the "Closing Dates."
Certificates evidencing the Shares shall be registered in such
names and shall be in such denominations as the Representatives shall request at
least two full business days before the Firm Shares Closing Date or, in the case
of Option Shares, on the day of notice of exercise of the option as described in
Section l(b) and shall be made available to the Representatives for checking and
packaging, at such place as is designated by the Representatives, on the full
business day before the Firm Shares Closing Date (or the Option Shares Closing
Date in the case of the Option Shares).
3. REGISTRATION STATEMENT AND PROSPECTUS; PUBLIC OFFERING. The
Company has prepared and filed in conformity with the requirements of the
Securities Act of 1933, as amended (the "Securities Act"), and the published
rules and regulations thereunder (the "Rules") adopted by the Securities and
Exchange Commission (the "Commission") a Registration Statement (as hereinafter
defined) on Form S-1 (No. 333-50182), including a preliminary prospectus
relating to the Shares, and such amendments thereof as may have been required to
the date of this Agreement. Copies of such Registration Statement (including all
amendments thereof) and of the related Preliminary Prospectus (as hereinafter
defined) have heretofore been delivered by the Company to you. The term
"Preliminary Prospectus" means any preliminary prospectus (as described in Rule
430 of the Rules) included at any time as a part of the Registration Statement
or filed with the Commission by the Company with the consent of the
Representatives pursuant to Rule 424(a) of the Rules. The term "Registration
Statement" as used in this Agreement means the initial registration statement
(including all exhibits, financial schedules and information deemed to be a part
of the Registration Statement through incorporation by reference or otherwise),
as amended at the time and on the date it becomes effective (the "Effective
Date") including the information (if any) deemed to be part thereof at the time
of effectiveness pursuant to Rule 430A of the Rules. If the Company has filed an
abbreviated registration statement to register additional Shares pursuant to
Rule 462(b) under the Rules (the "462(b) Registration Statement") then any
reference herein to the Registration Statement shall also be deemed to include
such 462(b) Registration Statement. The term "Prospectus" as used in this
Agreement means the prospectus in the form included in the Registration
Statement at the time of effectiveness or, if Rule 430A of the Rules is relied
on, the term Prospectus shall also include the final prospectus filed with the
Commission pursuant to Rule 424(b) of the Rules.
The Company understands that the Underwriters propose to make
a public offering of the Shares, as set forth in and pursuant to the Prospectus,
as soon after the Effective Date and the date of this Agreement as the
Representatives deem advisable. The Company hereby confirms that the
Underwriters and dealers have been authorized to distribute or cause to be
distributed each Preliminary Prospectus and are authorized to distribute the
Prospectus (as
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from time to time amended or supplemented if the Company furnishes amendments or
supplements thereto to the Underwriters).
4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
hereby represents and warrants to each Underwriter as follows:
(a) On the Effective Date, the Registration Statement
complied, and on the date of the Prospectus, the date any post-effective
amendment to the Registration Statement becomes effective, the date any
supplement or amendment to the Prospectus is filed with the Commission and each
Closing Date, the Registration Statement and the Prospectus (and any amendment
thereof or supplement thereto) will comply, in all material respects, with the
applicable provisions of the Securities Act and the Rules and the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and
regulations of the Commission thereunder. The Registration Statement did not, as
of the Effective Date, contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary in order
to make the statements therein not misleading; and on the Effective Date and the
other dates referred to above neither the Registration Statement nor the
Prospectus, nor any amendment thereof or supplement thereto, will contain any
untrue statement of a material fact or will omit to state any material fact
required to be stated therein or necessary in order to make the statements
therein not misleading. When any related preliminary prospectus was first filed
with the Commission (whether filed as part of the Registration Statement or any
amendment thereto or pursuant to Rule 424(a) of the Rules) and when any
amendment thereof or supplement thereto was first filed with the Commission,
such preliminary prospectus as amended or supplemented complied in all material
respects with the applicable provisions of the Securities Act and the Rules and
did not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein not misleading. Notwithstanding the foregoing, none of the
representations and warranties in this paragraph 4(a) shall apply to statements
in, or omissions from, the Registration Statement or the Prospectus made in
reliance upon, and in conformity with, information herein or otherwise furnished
in writing by the Representatives on behalf of the several Underwriters for use
in the Registration Statement or the Prospectus. With respect to the preceding
sentence, the Company acknowledges that the only information furnished in
writing by the Representatives on behalf of the several Underwriters for use in
the Registration Statement or the Prospectus consists of the information set
forth in the any legends required by Item 502(d) of Regulation S-K under the
Securities Act and, under the caption "Underwriting" in the Prospectus, the
statements contained (i) in the first table, listing the Underwriters and their
respective participation in the sale of the Shares, (ii) the fourth paragraph,
relating to concession and reallowance figures, (iii) the tenth paragraph,
concerning sales to accounts over which the Underwriters exercise discretionary
authority, and (iv) the twelfth paragraph, relating to stabilization, syndicate
covering transactions and penalty bids.
(b) The Registration Statement is effective under the
Securities Act and no stop order preventing or suspending the effectiveness of
the Registration Statement or suspending or preventing the use of the Prospectus
has been issued and no proceedings for that purpose have been instituted or are
threatened under the Securities Act. Any required filing of
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the Prospectus and any supplement thereto pursuant to Rule 424(b) of the Rules
has been or will be made in the manner and within the time period required by
such Rule 424(b).
(c) The consolidated financial statements (including all notes
and schedules thereto) of the Company, its predecessor company, WorldWide
Product Distribution, Inc. ("WWP") and the Subsidiaries (as defined below)
included in the Registration Statement and Prospectus present fairly, in all
material respects, the financial position, the results of operations, the
statements of cash flows and the statements of stockholders' equity and the
other information purported to be shown therein of the Company, WWP and the
Subsidiaries at the respective dates and for the respective periods to which
they apply; and, except as disclosed therein, such financial statements and
related schedules and notes have been prepared in conformity with applicable
generally accepted accounting principles, consistently applied throughout the
periods involved, and all adjustments necessary for a fair presentation of the
results for such periods have been made. The summary and selected financial data
included in the Prospectus present fairly, in all material respects, the
information shown therein as at the respective dates and for the respective
periods specified and the summary and selected financial data have been
presented on a basis consistent with the consolidated financial statements so
set forth in the Prospectus and other financial information.
(d) PricewaterhouseCoopers, LLP, whose reports are filed with
the Commission as a part of the Registration Statement, are and, during the
periods covered by their reports, were independent public accountants as
required by the Securities Act and the Rules.
(e) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware. The
Company has no subsidiary or subsidiaries and does not control, directly or
indirectly, any corporation, partnership, joint venture, association or other
business organization, except as set forth in Exhibit A hereto. Each of the
subsidiaries of the Company listed in Exhibit A hereto (collectively, the
"Subsidiaries") has been duly organized and is validly existing as a corporation
in good standing under the laws of the jurisdiction of its incorporation. The
Company and each of its Subsidiaries are duly qualified to do business and each
is in good standing as a foreign corporation in each jurisdiction in which the
nature of the business conducted by it or location of the assets or properties
owned, leased or licensed by it requires such qualification, except for such
jurisdictions where the failure to so qualify would not have a material adverse
effect on the assets or properties, business, results of operations or financial
condition of the Company and the Subsidiaries, taken as a whole (a "Material
Adverse Effect"). The Company and each of its Subsidiaries have all requisite
corporate power and authority, and all necessary authorizations, approvals,
consents, orders, licenses, certificates and permits of and from all
governmental or regulatory bodies or any other person or entity (collectively,
the "Permits"), to own, lease and license their assets and properties and
conduct their business, all of which are valid and in full force and effect, as
described in the Registration Statement and the Prospectus, except where the
lack of such Permits, individually or in the aggregate, would not have a
Material Adverse Effect. The Company and each of its Subsidiaries has fulfilled
and performed in all material respects all of their material obligations with
respect to such Permits and no event has occurred that allows, or after notice
or lapse of time would allow, revocation or termination thereof or results in
any other material impairment of the rights of the Company or any Subsidiary
thereunder. Except as may be required under the
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Securities Act and state and foreign Blue Sky laws, no other Permits are
required to enter into, deliver and perform this Agreement or to issue and sell
the Shares.
(f) The Subsidiaries listed on Exhibit B hereto are the only
significant subsidiaries of the Company (the "Significant Subsidiaries") as
defined by Rule 1-02 of Regulation S-X.
(g) The Company and its Subsidiaries own or possess adequate
and enforceable rights to use all trademarks, trademark applications, trade
names, service marks, copyrights, copyright applications, licenses, know-how and
other similar rights and proprietary knowledge (collectively, "Intangibles")
described in the Prospectus as being owned by them, necessary for the conduct of
their business. Neither the Company nor any of its Subsidiaries has received any
notice of, or is aware of, any infringement of or conflict with asserted rights
of others with respect to any Intangibles.
(h) The Company and its Subsidiaries possess such permits,
licenses, approvals, consents and other authorizations (collectively,
"Governmental Licenses") issued by the appropriate federal, state, local or
foreign regulatory agencies or bodies necessary to conduct the business now
operated by them as described in the Prospectus; the Company and its
Subsidiaries are in compliance with the terms and conditions of all such
Governmental Licenses, except where the failure so to comply would not, singly
or in the aggregate, result in, or be reasonably expected to result in, a
Material Adverse Effect; all of the Governmental Licenses are valid and in full
force and effect, except when the invalidity of such Governmental Licenses or
the failure of such Governmental Licenses to be in full force and effect would
not have a Material Adverse Effect; and neither the Company nor any Subsidiary
has received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses.
(i) To the Company's knowledge, (i) neither the Company's
products nor the Company's marketing of its products is in violation of any
regulatory requirements of the United States Food and Drug Administration or
Federal Trade Commission, (ii) there are no pending or threatened enforcement
actions by the United States Food and Drug Administration or Federal Trade
Commission against the Company, and (iii) the future commercialization of the
Company's products described in the Prospectus will not violate any regulatory
requirements of the United States Food and Drug Administration or Federal Trade
Commission.
(j) The Company and its Subsidiaries have good and marketable
title in fee simple to all items of real property and good and marketable title
to all personal property described in the Prospectus as being owned by them. Any
real property and buildings described in the Prospectus as being held under
lease by the Company or any of its Subsidiaries are held under valid, existing
and enforceable leases, free and clear of all liens, encumbrances, claims,
security interests and defects, except such as are described in the Registration
Statement and the Prospectus or would not have a Material Adverse Effect.
(k) There are no litigation or governmental proceedings to
which the Company or any of its Subsidiaries is subject or which is pending or,
to the knowledge of the Company, threatened, against the Company or any of its
Subsidiaries, which, individually or in
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the aggregate would reasonably be expected to (i) have a Material Adverse Effect
or (ii) adversely affect or prevent the consummation of this Agreement, or which
is required to be disclosed in the Registration Statement and the Prospectus
that is not so disclosed.
(l) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, except as described
therein, (a) there has not been any material adverse change with regard to the
assets or properties, business, results of operations or financial condition of
the Company; (b) neither the Company nor any of its Subsidiaries has sustained
any loss or interference with its assets, businesses or properties (whether
owned or leased) from fire, explosion, earthquake, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or any court or
legislative or other governmental action, order or decree which would have a
Material Adverse Effect; and (c) since the date of the latest balance sheet
included in the Registration Statement and the Prospectus, except as reflected
therein, neither the Company nor its Subsidiaries has (i) issued any securities
or incurred any liability or obligation, direct or contingent, for borrowed
money, except such liabilities or obligations incurred in the ordinary course of
business, (ii) entered into any transaction not in the ordinary course of
business or (iii) declared or paid any dividend or made any distribution on any
shares of its stock or redeemed, purchased or otherwise acquired or agreed to
redeem, purchase or otherwise acquire any shares of its stock.
(m) There is no document, contract or other agreement of a
character required to be described in the Registration Statement or Prospectus
or to be filed as an exhibit to the Registration Statement which is not
described or filed as required by the Securities Act or Rules. Each description
of a contract, document or other agreement in the Registration Statement and the
Prospectus accurately reflects in all material respects the terms of the
underlying document, contract or agreement. Each agreement described in the
Registration Statement and Prospectus or listed in the Exhibits to the
Registration Statement is in full force and effect and is valid and enforceable
by and against the Company or any Subsidiary, as the case may be, in accordance
with its terms. Neither the Company nor any Subsidiary, if any Subsidiary is a
party, nor to the Company's knowledge, any other party is in default in the
observance or performance of any term or obligation to be performed by it under
any such agreement, and no event has occurred which, with notice or lapse of
time, or both, would constitute such a default, in any such case which default
or event, individually or in the aggregate, would have a Material Adverse
Effect. No default exists, and no event has occurred which, with notice or lapse
of time, or both, would constitute a default, in the due performance and
observance of any term, covenant or condition, by the Company or any Subsidiary,
if any Subsidiary is a party thereto, of any other agreement or instrument to
which the Company or any Subsidiary is a party or by which the Company, its
Subsidiaries or their properties or business may be bound or affected which
default or event, individually or in the aggregate, would have a Material
Adverse Effect.
(n) Neither The Company nor any of its Subsidiaries is in
violation of any term or provision of its charter or by-laws (or similar
organizational documents) or of any franchise, license, permit, judgment,
decree, order, statute, rule or regulation, where the consequences of such
violation, individually or in the aggregate, would have a Material Adverse
Effect.
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(o) Neither the execution, delivery and performance of this
Agreement by the Company nor the consummation of any of the transactions
contemplated hereby (including, without limitation, the issuance and sale by the
Company of the Shares) will give rise to a right to terminate or accelerate the
due date of any payment due under, or conflict with or result in the breach of
any term or provision of, or constitute a default (or an event which with notice
or lapse of time or both would constitute a default) under, or require any
consent or waiver under, or result in the execution or imposition of any lien,
charge or encumbrance upon any properties or assets of the Company or its
Subsidiaries pursuant to the terms of, any indenture, mortgage, deed of trust or
other agreement or instrument to which the Company or any Subsidiary is a party
or by which the Company, its Subsidiaries or any of their properties or business
are bound, or any franchise, license, permit, judgment, decree, order, statute,
rule or regulation applicable to the Company or any Subsidiary or violate any
provision of the charter or by-laws (or similar organizational documents) of the
Company or any Subsidiary, except for such consents or waivers which have
already been obtained and are in full force and effect or where such conflict,
breach, default, lien or encumbrance would not reasonably be expected to result
in a Material Adverse Effect.
(p) The Company has authorized and outstanding capital stock
as set forth under the caption "Capitalization" in the Prospectus. The
certificates evidencing the Shares are in due and proper legal form and have
been duly authorized for issuance by the Company. All of the issued and
outstanding shares of Common Stock have been duly and validly issued and are
fully paid and nonassessable. There are no statutory preemptive or other similar
rights to subscribe for or to purchase or acquire any shares of Common Stock of
the Company or its Subsidiaries or any such rights pursuant to any provision of
the charter or by-laws (or similar organizational documents) of the Company or
its Subsidiaries or any agreement or instrument to or by which the Company or
any Subsidiary is a party or bound. The Shares, when issued and sold pursuant to
this Agreement, will be duly and validly issued, fully paid and nonassessable
and none of them will be issued in violation of any preemptive or other similar
right. Except as disclosed in the Registration Statement and the Prospectus,
there is no outstanding option, warrant or other right calling for the issuance
of, and there is no commitment, plan or arrangement to issue, any share of stock
of the Company or its Subsidiaries or any security convertible into, or
exercisable or exchangeable for, such stock. The Common Stock and the Shares
conform in all material respects to all statements in relation thereto contained
in the Registration Statement and the Prospectus.
(q) All outstanding shares of capital stock of each Subsidiary
have been duly authorized and validly issued, and are fully paid and
nonassessable and are owned directly by the Company or by another wholly-owned
subsidiary of the Company free and clear of any security interests, liens,
encumbrances, equities or claims, other than those described in the Prospectus.
(r) No holder of any security of the Company has the right to
have any security owned by such holder included in the Registration Statement or
to demand registration of any security owned by such holder during the period
ending 180 days after the date of this Agreement. Each director and executive
officer, and substantially all of the stockholders, of the Company have executed
and delivered to the Representatives an enforceable written lock-up agreement in
the form attached to this Agreement ("Lock-Up Agreement").
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(s) All necessary corporate action has been duly and validly
taken by the Company to authorize the execution, delivery and performance of
this Agreement and the issuance and sale of the Shares by the Company. This
Agreement has been duly and validly authorized, executed and delivered by the
Company and constitutes and will constitute a legal, valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms, except as the enforceability hereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles.
(t) Neither the Company nor any of its Subsidiaries are
involved in any labor dispute nor, to the knowledge of the Company, is any such
dispute threatened, which dispute would have a Material Adverse Effect. The
Company is not aware of any existing or imminent labor disturbance by the
employees of any of its principal suppliers or contractors which would have a
Material Adverse Effect. The Company is not aware of any threatened or pending
litigation between the Company or its Subsidiaries and any of its executive
officers which, if adversely determined, could have a Material Adverse Effect
and has no reason to believe that such officers will not remain in the
employment of the Company.
(u) No transaction has occurred between or among the Company
and any of its officers or directors or five percent (or greater) shareholders
or any affiliate or affiliates of any such officer or director or five percent
(or greater) shareholders that is required to be described in and is not
described in the Registration Statement and the Prospectus.
(v) The Company has not taken, nor will it take, directly or
indirectly, any action designed to or which might reasonably be expected to
cause or result in, or which has constituted or which might reasonably be
expected to constitute, the stabilization or manipulation of the price of the
Common Stock to facilitate the sale or resale of any of the Shares.
(w) The Company and its Subsidiaries have filed all Federal,
state, local and foreign tax returns which are required to be filed through the
date hereof, or have received extensions thereof, and have paid all taxes shown
on such returns and all assessments received by them to the extent that the same
are material and have become due. There are no tax audits or investigations
pending, which if adversely determined would have a Material Adverse Effect; nor
are there any material proposed additional tax assessments against the Company
or any of its Subsidiaries.
(x) The Shares have been duly authorized for quotation on the
National Association of Securities Dealers Automated Quotation ("Nasdaq")
National Market System, subject to official Notice of Issuance. A registration
statement has been filed on Form 8-A pursuant to Section 12 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), which registration
statement complies in all material respects with the Exchange Act.
(y) The books, records and accounts of the Company and its
Subsidiaries accurately and fairly reflect, in reasonable detail, the
transactions in, and dispositions of, the assets of, and the results of
operations of, the Company and its Subsidiaries. The Company maintains a system
of internal accounting controls sufficient to provide reasonable assurances
9
that (i) transactions are executed in accordance with management's general or
specific authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted
accounting principles and to maintain asset accountability, (iii) access to
assets is permitted only in accordance with management's general or specific
authorization and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(z) The Company and its Subsidiaries are insured by insurers
of recognized financial responsibility against such losses and risks and in such
amounts as are customary in the businesses in which they are engaged or propose
to engage after giving effect to the transactions described in the Prospectus;
all policies of insurance and fidelity or surety bonds insuring the Company or
any of its Subsidiaries or the Company's or its Subsidiaries' respective
businesses, assets, employees, officers and directors are in full force and
effect; the Company and each of its Subsidiaries are in compliance with the
terms of such policies and instruments in all material respects; and neither the
Company nor any Subsidiary has any reason to believe that it will not be able to
renew its existing insurance coverage as and when such coverage expires or to
obtain similar coverage from similar insurers as may be necessary to continue
its business at a cost that would not have a Material Adverse Effect. Neither
the Company nor any Subsidiary has been denied any insurance coverage which it
has sought or for which it has applied.
(aa) Each approval, consent, order, authorization,
designation, declaration or filing of, by or with any regulatory, administrative
or other governmental body necessary in connection with the execution and
delivery by the Company of this Agreement and the consummation of the
transactions herein contemplated required to be obtained or performed by the
Company (except such additional steps as may be required by the National
Association of Securities Dealers, Inc. (the "NASD") or may be necessary to
qualify the Shares for public offering by the Underwriters under the state
securities or Blue Sky laws) has been obtained or made and is in full force and
effect.
(bb) There are no affiliations with the NASD among the
Company's officers, directors or, to the best of the knowledge of the Company,
any five percent or greater stockholder of the Company, except as set forth in
the Registration Statement or otherwise disclosed in writing to the
Representatives.
(cc) (i) Each of the Company and its Subsidiaries is in
compliance in all material respects with all rules, laws and regulation relating
to the use, treatment, storage and disposal of toxic substances and protection
of health or the environment ("Environmental Law") which are applicable to its
business; (ii) neither the Company nor its Subsidiaries has received any notice
from any governmental authority or third party of an asserted claim under
Environmental Laws; (iii) each of the Company and its Subsidiaries has received
all permits, licenses or other approvals required of it under applicable
Environmental Laws to conduct its business and is in compliance with all terms
and conditions of any such permit, license or approval; (iv) to the Company's
knowledge, no facts currently exist that will require the Company or its
Subsidiaries to make future material capital expenditures to comply with
Environmental Laws; and (v) no property which is or has been owned, leased or
occupied by the
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Company or its Subsidiaries has been designated as a Superfund site pursuant to
the Comprehensive Environmental Response, Compensation of Liability Act of 1980,
as amended (42 U.S.C. Section 9601, et. seq. "CERCLA") or otherwise designated
as a contaminated site under applicable state or local law. Neither the Company
nor any of its Subsidiaries has been named as a "potentially responsible party"
under the CERCLA.
(dd) The Company is not and, after giving effect to the
offering and sale of the Shares and the application of proceeds thereof as
described in the Prospectus, will not be an "investment company" within the
meaning of the Investment Company Act of 1940, as amended (the "Investment
Company Act").
(ee) The Company, its Subsidiaries, and any other person
associated with or acting on behalf of the Company or its Subsidiaries
including, without limitation, any director, officer, agent or employee of the
Company or its Subsidiaries has not, directly or indirectly, while acting on
behalf of the Company or its Subsidiaries (i) used any corporate funds for
unlawful contributions, gifts, entertainment or other unlawful expenses relating
to political activity; (ii) made any unlawful payment to foreign or domestic
government officials or employees or to foreign or domestic political parties or
campaigns from corporate funds; (iii) violated any provision of the Foreign
Corrupt Practices Act of 1977, as amended; or (iv) made any other unlawful
payment.
(ff) The Company is in compliance in all material respects
with all presently applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended, including the regulations and published
interpretations thereunder ("ERISA"); no "reportable event" (as defined in
ERISA) has occurred with respect to any "pension plan" (as defined in ERISA) for
which the Company would have any liability; the Company has not incurred and
does not expect to incur liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any "pension plan" or (ii) Sections 412 or
4971 of the Internal Revenue Code of 1986, as amended, including the regulations
and published interpretations thereunder (the "Code"); and each "pension plan"
for which the Company would have any liability that is intended to be qualified
under Section 401(a) of the Code is so qualified in all material respects and
nothing has occurred, whether by action or by failure to act, which would cause
the loss of such qualification.
(gg) No consent, approval, authorization or order of, or
qualification with, any governmental body or agency, other than those obtained,
is required in connection with the offering of the Directed Shares in any
jurisdiction where the Directed Shares are being offered.
(hh) Neither the Company nor any other person associated with
or acting on behalf of the Company including, without limitation, any director,
officer, agent or employee of the Company has offered or caused the Underwriters
to offer any of the Shares to any person pursuant to the Friends and Family
Program with the specific intent to unlawfully influence (i) a customer or
supplier of the Company to alter the customer's or supplier's level or type of
business with the Company or (ii) a trade journalist or publication to write or
publish favorable information about the Company or its products.
11
5. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS. The
obligations of the Underwriters under this Agreement are several and not joint.
The respective obligations of the Underwriters to purchase the Shares are
subject to each of the following terms and conditions:
(a) Notification that the Registration Statement has become
effective shall have been received by the Representatives and the Prospectus
shall have been timely filed with the Commission in accordance with Section 6(a)
of this Agreement.
(b) No order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus shall have been or shall be in effect
and no order suspending the effectiveness of the Registration Statement shall be
in effect and no proceedings for such purpose shall be pending before or
threatened by the Commission, and any requests for additional information on the
part of the Commission (to be included in the Registration Statement or the
Prospectus or otherwise) shall have been complied with to the satisfaction of
the Commission and the Representatives.
(c) The representations and warranties of the Company
contained in this Agreement and in the certificates delivered pursuant to
Section 5(d) shall be true and correct when made and on and as of each Closing
Date as if made on such date. The Company shall have performed all covenants and
agreements and satisfied all the conditions contained in this Agreement required
to be performed or satisfied by them at or before such Closing Date.
(d) The Representatives shall have received on each Closing
Date a certificate, addressed to the Representatives and dated such Closing
Date, of the chief executive or chief operating officer and the chief financial
officer or chief accounting officer of the Company to the effect that (i) the
signers of such certificate have carefully examined the Registration Statement,
the Prospectus and this Agreement and that the representations and warranties of
the Company in this Agreement are true and correct on and as of such Closing
Date with the same effect as if made on such Closing Date and the Company has
performed all covenants and agreements and satisfied all conditions contained in
this Agreement required to be performed or satisfied by it at or prior to such
Closing Date, and (ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and to the best of their knowledge, no
proceedings for that purpose have been instituted or are pending under the
Securities Act.
(e) The Representatives shall have received, at the time this
Agreement is executed and on each Closing Date a signed letter from
PricewaterhouseCoopers, LLP addressed to the Representatives and dated,
respectively, the date of this Agreement and each such Closing Date, in form and
substance reasonably satisfactory to the Representatives, confirming that they
are independent accountants within the meaning of the Securities Act and the
Rules, that the response to Item 10 of the Registration Statement is correct
insofar as it relates to them and, containing statements and information of the
type ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statements and the Prospectus, including, without
limitation, statements that:
12
(i) in their opinion the audited financial statements
and financial statement schedules included in the Registration
Statement and the Prospectus and reported on by them comply as
to form in all material respects with the applicable
accounting requirements of the Securities Act and the Rules;
(ii) on the basis of a reading of the latest
unaudited consolidated financial statements made available by
the Company and its Subsidiaries and the amounts included in
the Registration Statement and the Prospectus under the
headings "Summary Consolidated Financial Data" and "Selected
Consolidated Financial Data"; carrying out certain procedures
(but not an examination in accordance with generally accepted
auditing standards) which would not necessarily reveal matters
of significance with respect to the comments set forth in such
letter; a reading of the minutes of the meetings of the
stockholders and directors, including the audit and
compensation committees of the board of directors, of the
Company; and inquiries of certain officials of the Company who
have responsibility for financial and accounting matters of
the Company as to transactions and events subsequent to the
date of the latest audited financial statements, except as
disclosed in the Registration Statement and the Prospectus,
nothing came to their attention which caused them to believe
that:
(A) the amounts in "Summary Consolidated
Financial Data," and "Selected Consolidated Financial
Data" included in the Registration Statement and the
Prospectus do not agree with the corresponding
amounts in the audited and unaudited consolidated
financial statements from which such amounts were
derived;
(B) the latest unaudited consolidated
financial statements made available by the Company
and its Subsidiaries and the amounts included in the
Registration Statement and the Prospectus under the
headings "Summary Consolidated Financial Data" and
"Selected Consolidated Financial Data" do not comply
as to the form in all material respects with the
applicable accounting requirements of the Securities
Act and the Rules, or that any material modifications
should be made to the information set forth therein
to bring it into conformity with generally accepted
accounting principles (applied on a basis
substantially consistent with that of the audited
consolidated financial statements included in the
Registration Statement and Prospectus); or
(C) with respect to the Company, there were,
at a specified date not more than three business days
prior to the date of the letter, any increases in the
current liabilities and long-term liabilities of the
Company or any decreases in net income or in working
capital or the stockholders' equity in the Company,
as compared with the amounts shown on the Company's
audited balance sheet for the fiscal year ended
December 31, 1999 and the nine months ended September
30, 2000 included in the Registration Statement;
13
References to the Registration Statement and the
Prospectus in this paragraph (e) are to such documents as
amended and supplemented at the date of the letter.
(f) The Representatives shall have received on each Closing
Date from Xxxxxxx Xxxx & Xxxxxxxxx, LLP, counsel for the Company, an opinion,
addressed to the Representatives and dated such Closing Date, and stating in
effect that:
(i) The Company has been duly organized and is
validly existing as a corporation in good standing under the
laws of the State of Delaware. Based solely on a review of
certificates from public officials, the Company is duly
qualified and in good standing as a foreign corporation in
each jurisdiction in which the character or location of its
assets or properties (owned, leased or licensed) or the nature
of its businesses makes such qualification necessary, except
for such jurisdictions where the failure to so qualify,
individually or in the aggregate, would not have a Material
Adverse Effect.
(ii) The Company has all requisite corporate power
and authority to own, lease and license its assets and
properties and conduct its business as now being conducted and
as described in the Registration Statement and the Prospectus
and to enter into, deliver and perform this Agreement and to
issue and sell the Shares other than approvals required under
the state and foreign Blue Sky laws.
(iii) Each of the Significant Subsidiaries has been
duly organized and is validly existing as a corporation in
good standing under the laws of the jurisdiction of its
incorporation, with corporate power and authority to own or
lease its properties and conduct its business as described in
the Registration Statement; the outstanding shares of capital
stock of each of the Significant Subsidiaries have been duly
authorized and validly issued and are fully paid and
non-assessable and are owned by the Company or a Subsidiary;
and, to the best of such counsel's knowledge, the outstanding
shares of capital stock of each of the Significant
Subsidiaries is owned free and clear of all liens,
encumbrances and equities and claims, and no options, warrants
or other rights to purchase, agreements or other obligations
to issue or other rights to convert any obligations into any
shares of capital stock or of ownership interests in the
Significant Subsidiaries are outstanding.
(iv) Each of the Significant Subsidiaries is duly
qualified to transact business in all jurisdictions in which
the conduct of its business requires such qualification.
(v) The Company has authorized and issued capital
stock as set forth in the Registration Statement and the
Prospectus under the caption "Capitalization"; the
certificates evidencing the Shares are in due and proper legal
form and have been duly authorized for issuance by the
Company; all of the
14
outstanding shares of Common Stock of the Company have been
duly and validly authorized and issued and are fully paid and
nonassessable and, to the knowledge of such counsel, none of
them was issued in violation of any preemptive or other
similar right. The Shares when issued and sold pursuant to
this Agreement will be duly and validly issued, outstanding,
fully paid and nonassessable and none of them will have been
issued in violation of any preemptive or other similar right.
(vi) To the best of such counsel's knowledge, except
as disclosed in the Registration Statement and the Prospectus,
there are no preemptive or other rights to subscribe for or to
purchase or any restriction upon the voting or transfer of any
securities of the Company pursuant to the Company's
certificate of incorporation or by-laws or other governing
documents or any agreements or other instruments to which the
Company is a party or by which it is bound; and except as
described in the Prospectus, to the knowledge of such counsel,
no holder of any securities of the Company or any other person
has the right, contractual or otherwise, which has not been
satisfied or effectively waived, to cause the Company to sell
or otherwise issue to them, or to permit them to underwrite
the sale of, any of the Shares or the right to have any Common
Shares or other securities of the Company included in the
Registration Statement or the right, as a result of the filing
of the Registration Statement, to require registration under
the Securities Act of any shares of Common Stock or other
securities of the Company.
(vii) To the best of such counsel's knowledge, except
as disclosed in the Registration Statement and the Prospectus,
there is no outstanding option, warrant or other right calling
for the issuance of, and no commitment, plan or arrangement to
issue, any share of stock of the Company or any security
convertible into, exercisable for, or exchangeable for stock
of the Company. The Common Stock and the Shares conform in all
material respects to the descriptions thereof contained in the
Registration Statement and the Prospectus under the caption
"Description of Capital Stock."
(viii) All necessary corporate action has been duly
and validly taken by the Company to authorize the execution,
delivery and performance of this Agreement and the issuance
and sale of the Shares. This Agreement has been duly and
validly executed and delivered by the Company.
(ix) Neither the execution, delivery and performance
of this Agreement by the Company nor the consummation of any
of the transactions contemplated hereby (including, without
limitation, the issuance and sale by the Company of the
Shares) will give rise to a right to terminate or accelerate
the due date of any payment due under, or conflict with or
result in the breach of any term or provision of, or
constitute a default (or any event which with notice or lapse
of time, or both, would constitute a default) under, or
require consent or waiver under, or result in the execution or
imposition of any lien, charge, claim, security interest or
encumbrance upon any properties or assets of the Company or
its Subsidiaries pursuant to the terms of any indenture,
mortgage, deed trust, note or
15
other agreement or instrument of which such counsel is aware
and to which the Company or any Subsidiary is a party or by
which either the Company or any Subsidiary or any of their
properties or businesses are bound, or any franchise, license,
permit, judgment, decree, order, statute, rule or regulation
of which such counsel is aware or violate any provision of the
certificate of incorporation or by-laws of the Company.
(x) To the best of such counsel's knowledge, no
default exists, and no event has occurred which with notice or
lapse of time, or both, would constitute a default, in the due
performance and observance of any term, covenant or condition
by the Company of any indenture, mortgage, deed of trust, note
or any other agreement or instrument to which the Company is a
party or by which it or any of its assets or properties or
businesses may be bound or affected, where the consequences of
such default, individually or in the aggregate, would have a
Material Adverse Effect.
(xi) To the best of such counsel's knowledge, the
Company and its Subsidiaries are not in violation of any term
or provision of their certificate of incorporation, charter,
by-laws (or similar organizational document) or any franchise,
license, permit, judgment, decree, order, statute, rule or
regulation, where the consequences of such violation,
individually or in the aggregate, would have a Material
Adverse Effect.
(xii) No consent, approval, authorization or order of
any court or governmental agency or regulatory body is
required for the execution, delivery or performance of this
Agreement by the Company or the consummation of the
transactions contemplated hereby or thereby, except such as
have been obtained under the Securities Act and such as may be
required by the NASD or under state securities or Blue Sky
laws in connection with the purchase and distribution of the
Shares by the several Underwriters.
(xiii) To the best of such counsel's knowledge, there
is no litigation or governmental or other proceeding or
investigation, before any court or before or by any public
body or board pending or threatened against, or involving the
assets, properties or businesses of, the Company which would
have a Material Adverse Effect.
(xiv) The statements in the Prospectus under the
captions "Business-Collaborations," "Business-Intellectual
Property," "Management," "Description of Capital Stock,"
"Shares Eligible for Future Sale," and "U.S. Federal Tax
Considerations for Non-U.S. Holders," insofar as such
statements constitute a summary of contracts or other
documents referred to therein or matters of law, are fair
summaries in all material respects and accurately present the
information called for with respect to such documents and
matters. Accurate copies of all contracts and other documents
required to be filed as exhibits to, or described in,
16
the Registration Statement have been so filed with the
Commission or are fairly described in the Registration
Statement, as the case may be.
(xv) The Registration Statement, all Preliminary
Prospectuses and the Prospectus and each amendment or
supplement thereto (except for the financial statements and
schedules and other financial and statistical data included
therein, as to which such counsel expresses no opinion) comply
as to form in all material respects with the requirements of
the Securities Act and the Rules.
(xvi) The Registration Statement is effective under
the Securities Act, and no stop order suspending the
effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted or
are threatened, pending or contemplated. Any required filing
of the Prospectus and any supplement thereto pursuant to Rule
424(b) under the Securities Act has been made in the manner
and within the time period required by such Rule 424(b).
(xvii) The Shares have been approved for listing on
the Nasdaq National Market.
(xviii) The Company is not an "investment company" or
an entity controlled by an "investment company" as such terms
are defined in the Investment Company Act of 1940, as amended.
To the extent deemed advisable by such counsel, they may rely
as to matters of fact on certificates of responsible officers of the Company and
public officials and on the opinions of other counsel satisfactory to the
Representatives as to matters which are governed by laws other than the laws of
the State of Wisconsin, the General Corporation Law of the State of Delaware and
the Federal laws of the United States; provided that such counsel shall state
that in their opinion the Underwriters and they are justified in relying on such
other opinions. Copies of such certificates and other opinions shall be
furnished to the Representatives and counsel for the Underwriters.
In addition, such counsel shall state that such counsel has
participated in conferences with officers and other representatives of the
Company, representatives of the Representatives and representatives of the
independent certified public accountants of the Company, at which conferences
the contents of the Registration Statement and 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 Registration Statement and the Prospectus (except as
specified in the foregoing opinion), on the basis of the foregoing, no facts
have come to the attention of such counsel which lead such counsel to believe
that the Registration Statement at the time it became effective (except with
respect to the financial statements and notes and schedules thereto and other
financial data, as to which such counsel need express no belief) 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,
or that the Prospectus as amended or supplemented (except with respect to the
financial statements, notes and schedules thereto and other financial data, as
to which such
17
counsel need make no statement) on the date thereof contained any untrue
statement of a material fact or omitted to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
(g) The Representatives shall have received on each Closing
Date from Xxxxx, Xxxxxx & XxXxxxxx, P.C., special counsel for the Company, an
opinion, addressed to the Representatives and dated such Closing Date, and
stating in effect that:
(i) Such counsel has no knowledge of any facts that
would lead such counsel to conclude (i) that the Company is in
violation of any regulatory requirements of the United States
Food and Drug Administration or Federal Trade Commission; or
(ii) that any future commercialization of any of the Company's
products described in the Registration Statement or Prospectus
would be in violation of any regulatory requirements of the
United States Food and Drug Administration or Federal Trade
Commission;
(ii) Such counsel has no knowledge of any pending or
threatened United States Food and Drug Administration
enforcement action against the Company or any material legal
or governmental proceedings pending or threatened against the
Company or any of the Subsidiaries, except as set forth in the
Prospectus;
(iii) Such counsel has read the statements in the
Prospectus under the captions "Prospectus Summary-Our
Products," "Risk Factors-Any failure to obtain applicable U.S.
and foreign regulatory approvals or to comply with ongoing
government regulations in the U.S. and foreign countries will
limit our ability to market and sell our products," "Risk
Factors-If we fail to comply with applicable marketing
regulations, we could be required to withdraw our products
from the market or to cease our marketing activities," "Risk
Factors-If the FDA elects to regulate Cymetra as a medical
device, the costs of developing, manufacturing and marketing
Cymetra could be increased," "Business-Our Products," and
"Business-Government Regulation," and such counsel is of the
opinion that the statements included under such captions that
summarize provisions of the Federal Food, Drug, and Cosmetic
Act and the Public Health Service Act and implementing
regulations are correct in all material respects; and
(iv) Although such counsel has made no independent
inquiry, nothing has come to such counsel's attention that
leads such counsel to believe that the statements in the
Prospectus under the captions referred to in subparagraph
(iii) above as of the date of the Prospectus or on the Closing
Date, contained or contain any untrue statement of a material
fact relating to the Company or to United States Food and Drug
Administration or Federal Trade Commission matters or omitted
or omit to state any material fact relating to the Company or
to United States Food and Drug Administration or Federal Trade
Commission matters which is necessary to make the statements
therein, in light of the circumstances under which they were
made, not misleading.
18
(h) All proceedings taken in connection with the sale of the
Firm Shares and the Option Shares as herein contemplated shall be reasonably
satisfactory in form and substance to the Representatives, and their counsel and
the Underwriters shall have received from Shearman & Sterling a favorable
opinion, addressed to the Representatives and dated such Closing Date, with
respect to the Shares, the Registration Statement and the Prospectus, and such
other related matters, as the Representatives may reasonably request, and the
Company shall have furnished to Shearman & Sterling such documents as they may
reasonably request for the purpose of enabling them to pass upon such matters.
(i) The Representatives shall have received copies of the
Lock-up Agreements executed by each entity or person described in Section 4(n).
(j) The Company shall have furnished or caused to be furnished
to the Representatives such further certificates or documents as the
Representatives shall have reasonably requested.
6. COVENANTS OF THE COMPANY.
(a) The Company covenants and agrees as follows:
(i) The Company will use its best efforts to cause
the Registration Statement, if not effective at the time of
execution of this Agreement, and any amendments thereto, to
become effective as promptly as possible. The Company shall
prepare the Prospectus in a form approved by the
Representatives and file such Prospectus pursuant to Rule
424(b) under the Securities Act not later than the
Commission's close of business on the second business day
following the execution and delivery of this Agreement, or, if
applicable, such earlier time as may be required by Rule
430A(a)(3) under the Securities Act.
(ii) The Company shall promptly advise the
Representatives in writing (i) when any amendment to the
Registration Statement shall have become effective, (ii) of
any request by the Commission for any amendment of the
Registration Statement or the Prospectus or for any additional
information, (iii) of the prevention or suspension of the use
of any preliminary prospectus or the Prospectus or of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution
or threatening of any proceeding for that purpose and (iv) of
the receipt by the Company of any notification with respect to
the suspension of the qualification of the Shares for sale in
any jurisdiction or the initiation or threatening of any
proceeding for such purpose. The Company shall not file any
amendment of the Registration Statement or supplement to the
Prospectus unless the Company has furnished the
Representatives a copy for its review prior to filing and
shall not file any such proposed amendment or supplement to
which the Representatives reasonably object. The Company shall
use its best efforts to prevent the issuance of any such stop
order and, if issued, to obtain as soon as possible the
withdrawal thereof.
19
(iii) If, at any time when a prospectus relating to
the Shares is required to be delivered under the Securities
Act and the Rules, any event occurs as a result of which the
Prospectus as then amended or supplemented would include any
untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein in the
light of the circumstances under which they were made not
misleading, or if it shall be necessary to amend or supplement
the Prospectus to comply with the Securities Act or the Rules,
the Company promptly shall prepare and file with the
Commission, subject to the second sentence of paragraph (ii)
of this Section 6(a), an amendment or supplement which shall
correct such statement or omission or an amendment which shall
effect such compliance.
(iv) The Company shall make generally available to
its security holders and to the Representatives as soon as
practicable, but not later than 45 days after the end of the
12-month period beginning at the end of the fiscal quarter of
the Company during which the Effective Date occurs (or 90 days
if such 12-month period coincides with the Company's fiscal
year), an earning statement (which need not be audited) of the
Company, covering such 12-month period, which shall satisfy
the provisions of Section 11(a) of the Securities Act or Rule
158 of the Rules.
(v) The Company shall furnish to the Representatives
and counsel for the Underwriters, without charge, signed
copies of the Registration Statement (including all exhibits
thereto and amendments thereof) and to each other Underwriter
a copy of the Registration Statement (without exhibits
thereto) and all amendments thereof and, so long as delivery
of a prospectus by an Underwriter or dealer may be required by
the Securities Act or the Rules, as many copies of any
Preliminary Prospectus and the Prospectus and any amendments
thereof and supplements thereto as the Representatives may
reasonably request.
(vi) The Company shall cooperate with the
Representatives and their counsel in endeavoring to qualify
the Shares for offer and sale in connection with the offering
under the laws of such jurisdictions as the Representatives
may designate and shall maintain such qualifications in effect
so long as required for the distribution of the Shares;
provided, however, that the Company shall not be required in
connection therewith, as a condition thereof, to qualify as a
foreign corporation or to execute a general consent to service
of process in any jurisdiction or subject itself to taxation
as doing business in any jurisdiction.
(vii) Without the prior written consent of CIBC World
Markets Corp., for a period of 180 days after the date of this
Agreement, the Company and each of its individual directors
and executive officers shall not issue, sell or register with
the Commission (other than on Form S-8 or on any successor
form), or otherwise dispose of, directly or indirectly, any
equity securities of the Company (or any securities
convertible into, exercisable for or exchangeable for equity
securities of the Company), except for the issuance of the
Shares pursuant to the
20
Registration Statement and the issuance of shares pursuant to
the Company's existing stock option plan or bonus plan as
described in the Registration Statement and the Prospectus. In
the event that during this period, (i) any shares are issued
pursuant to the Company's existing stock option plan or bonus
plan that are exercisable during such 180 day period or (ii)
any registration is effected on Form S-8 or on any successor
form relating to shares that are exercisable during such 180
period, the Company shall obtain the written agreement of such
grantee or purchaser or holder of such registered securities
that, for a period of 180 days after the date of this
Agreement, such person will not, without the prior written
consent of CIBC World Markets Corp., offer for sale, sell,
distribute, grant any option for the sale of, or otherwise
dispose of, directly or indirectly, or exercise any
registration rights with respect to, any shares of Common
Stock (or any securities convertible into, exercisable for, or
exchangeable for any shares of Common Stock) owned by such
person.
(viii) On or before completion of this offering, the
Company shall make all filings required under applicable
securities laws and by the Nasdaq National Market (including
any required registration under the Exchange Act).
(ix) The Company will apply the net proceeds from the
offering of the Shares in the manner set forth under "Use of
Proceeds" in the Prospectus.
(x) The Company will comply with all applicable
securities laws and other applicable laws, rules and
regulations in each foreign jurisdiction in which the Directed
Shares are offered in connection with the Friends and Family
Program.
(xi) The Company will ensure that the Directed Shares
will be restricted, to the extent required by the NASD or the
NASD rules, from sale, transfer, assignment, pledge or
hypothecation for a period of three months following the date
of the effectiveness of the Registration Statement. The
Representatives will notify the Company as to which
Participants will need to be so restricted. The Company shall
direct the transfer agent to place stop transfer restrictions
upon such securities for such period of time.
(b) The Company agrees to pay, or reimburse if paid by the
Representatives, whether or not the transactions contemplated hereby are
consummated or this Agreement is terminated, all costs and expenses incident to
the public offering of the Shares and the performance of the obligations of the
Company under this Agreement including those relating to: (i) the preparation,
printing, filing and distribution of the Registration Statement including all
exhibits thereto, each preliminary prospectus, the Prospectus, all amendments
and supplements to the Registration Statement and the Prospectus, and the
printing, filing and distribution of this Agreement; (ii) the preparation and
delivery of certificates for the Shares to the Underwriters; (iii) the
registration or qualification of the Shares for offer and sale under the
securities or Blue Sky laws of the various jurisdictions referred to in Section
6(a)(vi), including the reasonable fees and disbursements of counsel for the
Underwriters in connection with such registration and
21
qualification and the preparation, printing, distribution and shipment of
preliminary and supplementary Blue Sky memoranda; (iv) the furnishing (including
costs of shipping and mailing) to the Representatives and to the Underwriters of
copies of each preliminary prospectus, the Prospectus and all amendments or
supplements to the Prospectus, and of the several documents required by this
Section to be so furnished, as may be reasonably requested for use in connection
with the offering and sale of the Shares by the Underwriters or by dealers to
whom Shares may be sold; (v) the filing fees of the NASD in connection with its
review of the terms of the public offering and reasonable fees and disbursements
of counsel for the Underwriters in connection with such review; (vi) inclusion
of the Shares for quotation on the Nasdaq National Market; (vii) all transfer
taxes, if any, with respect to the sale and delivery of the Shares by the
Company to the Underwriters; and (viii) payments to counsel for costs incurred
by the Underwriters in connection with the Friends and Family Program and
payment of any stamp duties, similar taxes or duties or other taxes, if any,
incurred by the Underwriters in connection with the Friends and Family Program.
Subject to the provisions of Section 9, the Underwriters agree to pay, whether
or not the transactions contemplated hereby are consummated or this Agreement is
terminated, all costs and expenses incident to the performance of the
obligations of the Underwriters under this Agreement not payable by the Company
pursuant to the preceding sentence, including, without limitation, the fees and
disbursements of counsel for the Underwriters.
7. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act
against any and all losses, claims, damages and liabilities, joint or several
(including any reasonable investigation, legal and other expenses incurred in
connection with, and any amount paid in settlement of, any action, suit or
proceeding or any claim asserted), to which they, or any of them, may become
subject under the Securities Act, the Exchange Act or other Federal or state law
or regulation, at common law or otherwise, insofar as such losses, claims,
damages or liabilities arise out of or are based upon (i) any untrue statement
or alleged untrue statement of a material fact contained in any Preliminary
Prospectus, the Registration Statement or the Prospectus or any amendment
thereof or supplement thereto, or in any Blue Sky application or other
information or other documents executed by the Company filed in any state or
other jurisdiction to qualify any or all of the Shares under the securities laws
thereof (any such application, document or information being hereinafter
referred to as a "Blue Sky Application") or arise out of or are based upon any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, (ii)
in whole or in part upon any breach of the representations and warranties set
forth in Section 4 hereof, or (iii) in whole or in part upon any failure of the
Company to perform any of its obligations hereunder or under law; provided,
however, that such indemnity shall not inure to the benefit of any Underwriter
(or any person controlling such Underwriter) on account of any losses, claims,
damages or liabilities arising from the sale of the Shares to any person by such
Underwriter if such untrue statement or omission or alleged untrue statement or
omission was made in such Preliminary Prospectus, the Registration Statement or
the Prospectus, or such amendment or supplement thereto, or in any Blue Sky
Application in reliance upon and in conformity with information furnished in
writing to the Company by the Representatives on
22
behalf of any Underwriter specifically for use therein. This indemnity agreement
will be in addition to any liability which the Company may otherwise have.
The Company agrees to indemnify and hold harmless the
Representatives and each person, if any, who controls any
Representative within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act against any and all losses, claims,
damages, expenses and liabilities (including any reasonable
investigation, legal and other expenses incurred in connection with,
and any amount paid in settlement of, any action, suit or proceeding or
any claim asserted) (i) arising out of or based upon any untrue
statement or alleged untrue statement of a material fact contained in
any material prepared by or with the consent of the Company for
distribution to Participants in connection with the Friends and Family
Program or arising out of or based upon any omission or alleged
omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, (ii)
arising out of or based upon the failure of any Participant to pay for
and accept delivery of Directed Shares otherwise reserved for such
Participant pursuant to the Friends and Family Program, and (iii)
related to, arising out of, or in connection with the Friends and
Family Program, other than losses, claims, damages or liabilities (or
expenses relating thereto) that are finally judicially determined to
have resulted from the bad faith, willful misconduct or gross
negligence of the Representatives; provided, however, that such
indemnity shall not inure to the benefit of any Underwriter (or any
person controlling such Underwriter) on account of any losses, claims,
damages or liabilities arising from the sale of the Directed Shares to
any person by such Underwriter if such untrue statement or omission or
alleged untrue statement or omission was made in such Preliminary
Prospectus, the Registration Statement or the Prospectus, or such
amendment or supplement thereto, or in any Blue Sky Application in
reliance upon and in conformity with information furnished in writing
to the Company by the Representatives on behalf of any Underwriter
specifically for use therein. .
(b) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company and each person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act, each director of the Company, and each officer of the
Company who signs the Registration Statement, to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only insofar as
such losses, claims, damages or liabilities arise out of or are based upon any
untrue statement or omission or alleged untrue statement or omission which was
made in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment thereof or supplement thereto, contained in the any
legends required by Item 502(d) of Regulation S-K under the Securities Act and,
under the caption "Underwriting" in the Prospectus, the statements contained (i)
in the first table, listing the Underwriters and their respective participation
in the sale of the Shares, (ii) the fourth paragraph, relating to concession and
reallowance figures, (iii) the tenth paragraph, concerning sales to accounts
over which the Underwriters exercise discretionary authority, and (iv) the
twelfth paragraph, relating to stabilization, syndicate covering transactions
and penalty bids; provided, however, that the obligation of each Underwriter to
indemnify the Company (including any controlling person, director or officer
thereof) shall be limited to the net proceeds received by the Company from such
Underwriter.
23
This indemnity agreement will be in addition to any liability which the
respective Underwriters may otherwise have.
(c) Any party that proposes to assert the right to be
indemnified under this Section will, promptly after receipt of notice of
commencement of any action, suit or proceeding against such party in respect of
which a claim is to be made against an indemnifying party or parties under this
Section, notify each such indemnifying party of the commencement of such action,
suit or proceeding, enclosing a copy of all papers served. No indemnification
provided for in Section 7(a) or 7(b) shall be available to any party who shall
fail to give notice as provided in this Section 7(c) if the party to whom notice
was not given was unaware of the proceeding to which such notice would have
related and was prejudiced by the failure to give such notice but the omission
so to notify such indemnifying party of any such action, suit or proceeding
shall not relieve it from any liability that it may have to any indemnified
party for contribution or otherwise than under this Section. In case any such
action, suit or proceeding shall be brought against any indemnified party and it
shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate in, and, to the extent that
it shall wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof and the
approval by the indemnified party of such counsel, the indemnifying party shall
not be liable to such indemnified party for any legal or other expenses, except
as provided below and except for the reasonable costs of investigation
subsequently incurred by such indemnified party in connection with the defense
thereof. The indemnified party shall have the right to employ its counsel in any
such action, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the employment of counsel by such
indemnified party has been authorized in writing by the indemnifying parties,
(ii) the indemnified party shall have been advised by counsel that there may be
one or more legal defenses available to it which are different from or in
addition to those available to the indemnifying party (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 (iii) the indemnifying parties
shall not have employed counsel to assume the defense of such action within a
reasonable time after notice of the commencement thereof, in each of which cases
the fees and expenses of counsel shall be at the expense of the indemnifying
parties. An indemnifying party shall not be liable for any settlement of any
action, suit, proceeding or claim effected without its written consent, which
consent shall not be unreasonably withheld or delayed.
8. CONTRIBUTION. In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in
Section 7(a) or 7(b) is due in accordance with its terms but for any reason is
held to be unavailable to or insufficient to hold harmless an indemnified party
under Section 7(a) or 7(b), then each indemnifying party shall contribute to the
aggregate losses, claims, damages and liabilities (including any investigation,
legal and other expenses reasonably incurred in connection with, and any amount
paid in settlement of, any action, suit or proceeding or any claims asserted,
but after deducting any contribution received by any person entitled hereunder
to contribution from any person who may be liable for contribution) to which the
indemnified party may be subject in such proportion as is appropriate to reflect
the relative benefits received by the Company on the one hand and the
24
Underwriters on the other from the offering of the Shares or, if such allocation
is not permitted by applicable law or indemnification is not available as a
result of the indemnifying party not having received notice as provided in
Section 7 hereof, in such proportion as is appropriate to reflect not only the
relative benefits referred to above but also the relative fault of the Company
on the one hand and the Underwriters on the other in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Underwriters shall be
deemed to be in the same proportion as (x) the total proceeds from the offering
(net of underwriting discounts but before deducting expenses) received by the
Company, as set forth in the table on the cover page of the Prospectus, bear to
(y) the underwriting discounts received by the Underwriters, as set forth in the
table on the cover page of the Prospectus. The relative fault of the Company or
the Underwriters shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact related to
information supplied by the Company or the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this Section 8
were determined by pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above. Notwithstanding
the provisions of this Section 8, (i) in no case shall any Underwriter (except
as may be provided in the Agreement Among Underwriters) be liable or responsible
for any amount in excess of the underwriting discount applicable to the Shares
purchased by such Underwriter hereunder; and (ii) the Company shall be liable
and responsible for any amount in excess of such underwriting discount;
provided, however, that no person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 8, each person, if any, who
controls an Underwriter within the meaning of Section 15 of the Securities Act
or Section 20(a) of the Exchange Act shall have the same rights to contribution
as such Underwriter, and each person, if any, who controls the Company within
the meaning of the Section 15 of the Securities Act or Section 20(a) of the
Exchange Act, each officer of the Company who shall have 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 clauses (i) and (ii) in the
immediately preceding sentence of this Section 8. Any party entitled to
contribution will, promptly after receipt of notice of commencement of any
action, suit or proceeding against such party in respect of which a claim for
contribution may be made against another party or parties under this Section,
notify such party or parties from whom contribution may be sought, but the
omission so to notify such party or parties from whom contribution may be sought
shall not relieve the party or parties from whom contribution may be sought from
any other obligation it or they may have hereunder or otherwise than under this
Section. No party shall be liable for contribution with respect to any action,
suit, proceeding or claim settled without its written consent. The Underwriter's
obligations to contribute pursuant to this Section 9 are several in proportion
to their respective underwriting commitments and not joint.
25
9. TERMINATION. This Agreement may be terminated with respect
to the Shares to be purchased on a Closing Date by the Representatives by
notifying the Company at any time
(a) in the absolute discretion of the Representatives at or
before any Closing Date: (i) if on or prior to such date, any domestic or
international event or act or occurrence has materially disrupted, or in the
opinion of the Representatives will in the future materially disrupt, the
securities markets; (ii) if there has occurred any new outbreak or material
escalation of hostilities or other calamity or crisis the effect of which on the
financial markets of the United States is such as to make it, in the judgment of
the Representatives, inadvisable to proceed with the offering; (iii) if there
shall be such a material adverse change in general financial, political or
economic conditions or the effect of international conditions on the financial
markets in the United States is such as to make it, in the judgment of the
Representatives, inadvisable or impracticable to market the Shares; (iv) if
trading in the Shares has been suspended by the Commission or trading generally
on the New York Stock Exchange, Inc., on the American Stock Exchange, Inc. or
the Nasdaq National Market has been suspended or limited, or minimum or maximum
ranges for prices for securities shall have been fixed, or maximum ranges for
prices for securities have been required, by said exchanges or by order of the
Commission, the National Association of Securities Dealers, Inc., or any other
governmental or regulatory authority; or (v) if a banking moratorium has been
declared by any state or Federal authority; or (vi) if, in the judgment of the
Representatives, there has occurred a Material Adverse Effect, or
(b) at or before any Closing Date, that any of the conditions
specified in Section 5 shall not have been fulfilled when and as required by
this Agreement.
If this Agreement is terminated pursuant to any of its
provisions, the Company shall not be under any liability to any Underwriter, and
no Underwriter shall be under any liability to the Company, except that (y) if
this Agreement is terminated by the Representatives or the Underwriters because
of any failure, refusal or inability on the part of the Company to comply with
the terms or to fulfill any of the conditions of this Agreement, the Company
will reimburse the Underwriters for all out-of-pocket expenses (including the
reasonable fees and disbursements of their counsel) incurred by them in
connection with the proposed purchase and sale of the Shares or in contemplation
of performing their obligations hereunder and (z) no Underwriter who shall have
failed or refused to purchase the Shares agreed to be purchased by it under this
Agreement, without some reason sufficient hereunder to justify cancellation or
termination of its obligations under this Agreement, shall be relieved of
liability to the Company or to the other Underwriters for damages occasioned by
its failure or refusal.
10. SUBSTITUTION OF UNDERWRITERS. If one or more of the
Underwriters shall fail (other than for a reason sufficient to justify the
cancellation or termination of this Agreement under Section 9) to purchase on
any Closing Date the Shares agreed to be purchased on such Closing Date by such
Underwriter or Underwriters, the Representatives shall use commercially
reasonable efforts to find one or more substitute underwriters to purchase such
Shares or make such other arrangements as the Representatives may deem advisable
or one or more of the remaining Underwriters may agree to purchase such Shares
in such proportions as may be approved by the Representatives, in each case upon
the terms set forth in this Agreement. If no
26
such arrangements have been made by the close of business on the business day
following such Closing Date,
(a) if the number of Shares to be purchased by the defaulting
Underwriters on such Closing Date shall not exceed 10% of the Shares that all
the Underwriters are obligated to purchase on such Closing Date, then each of
the nondefaulting Underwriters shall be obligated to purchase such Shares on the
terms herein set forth in proportion to their respective obligations hereunder;
provided, that in no event shall the maximum number of Shares that any
Underwriter has agreed to purchase pursuant to Section 1 be increased pursuant
to this Section 10 by more than one-ninth of such number of Shares without the
written consent of such Underwriter, or
(b) if the number of Shares to be purchased by the defaulting
Underwriters on such Closing Date shall exceed 10% of the Shares that all the
Underwriters are obligated to purchase on such Closing Date, then the Company
shall be entitled to one additional business day within which it may, but is not
obligated to, find one or more substitute underwriters reasonably satisfactory
to the Representatives to purchase such Shares upon the terms set forth in this
Agreement.
In any such case, either the Representatives or the Company
shall have the right to postpone the applicable Closing Date for a period of not
more than five business days in order that necessary changes and arrangements
(including any necessary amendments or supplements to the Registration Statement
or Prospectus) may be effected by the Representatives and the Company. If the
number of Shares to be purchased on such Closing Date by such defaulting
Underwriter or Underwriters shall exceed 10% of the Shares that all the
Underwriters are obligated to purchase on such Closing Date, and none of the
nondefaulting Underwriters or the Company shall make arrangements pursuant to
this Section within the period stated for the purchase of the Shares that the
defaulting Underwriters agreed to purchase, this Agreement shall terminate with
respect to the Shares to be purchased on such Closing Date without liability on
the part of any nondefaulting Underwriter to the Company and without liability
on the part of the Company, except in both cases as provided in Sections 6(b),
7, 8 and 9. The provisions of this Section shall not in any way affect the
liability of any defaulting Underwriter to the Company or the nondefaulting
Underwriters arising out of such default. A substitute underwriter hereunder
shall become an Underwriter for all purposes of this Agreement.
11. MISCELLANEOUS. The respective agreements, representations,
warranties, indemnities and other statements of the Company or its officers and
of the Underwriters set forth in or made pursuant to this Agreement shall remain
in full force and effect, regardless of any investigation made by or on behalf
of any Underwriter or the Company or any of the officers, directors or
controlling persons referred to in Sections 7 and 8 hereof, and shall survive
delivery of and payment for the Shares. The provisions of Sections 6(b), 7, 8
and 9 shall survive the termination or cancellation of this Agreement.
This Agreement has been and is made for the benefit of the
Underwriters, the Company and their respective successors and assigns, and, to
the extent expressed herein, for the benefit of persons controlling any of the
Underwriters, or the Company, and directors and officers of the Company, and
their respective successors and assigns, and no other person shall
27
acquire or have any right under or by virtue of this Agreement. The term
"successors and assigns" shall not include any purchaser of Shares from any
Underwriter merely because of such purchase.
All notices and communications hereunder shall be in writing
and mailed or delivered or by telephone or telegraph if subsequently confirmed
in writing, if to the Representatives, c/o CIBC World Markets Corp., Xxx Xxxxx
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 Attention: Xxxxxxx Xxxxxx, with a
copy to Xxxx X. Xxxxxxx, Shearman & Sterling, 000 Xxxxxxxxxx Xxxxxx, Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000, and if to the Company, to its agent for service as
such agent's address appears on the cover page of the Registration Statement
with a copy to Xxx X. Xxxxxxxxx, Xxxxxxx Xxxx & Xxxxxxxxx LLP, X.X. Xxx 0000,
Xxxxxxx, Xxxxxxxxx 00000-0000.
28
This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without regard to principles
of conflict of laws.
This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
Please confirm that the foregoing correctly sets forth the
agreement among us.
Very truly yours,
OMP, Inc.
By:
--------------------------
Name:
Title:
Confirmed:
CIBC WORLD MARKETS CORP.
Acting severally on behalf of itself
and as representative of the several
Underwriters named in Schedule I
annexed hereto.
By: CIBC WORLD MARKETS CORP.
By:
---------------------------
Name:
Title:
SCHEDULE I
NUMBER OF FIRM
NAME SHARES TO BE PURCHASED
---- ----------------------
CIBC World Markets Corp.
Xxxxxx Xxxxxx Partners LLC
U.S. Bancorp Xxxxx Xxxxxxx Inc.
---------------
Total: 4,500,000
EXHIBIT A
SUBSIDIARIES OF THE COMPANY
EXHIBIT B
SIGNIFICANT SUBSIDIARIES OF THE COMPANY
EXHIBIT C
FORM OF LOCK-UP AGREEMENT
LOCK-UP AGREEMENT
_________, 2000
CIBC World Markets Corp.
Prudential Securities Incorporated
As Representative of the Several Underwriters
c/o CIBC World Markets Corp.
CIBC World Markets Tower
World Financial Center
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: PUBLIC OFFERING OF COMMON STOCK OF OMP, INC.
Ladies and Gentlemen:
The undersigned, a holder of common stock ("Common Stock") or rights to
acquire Common Stock, of OMP, Inc. (the "Company"), a Delaware corporation,
understands that the Company intends to file a Registration Statement on Form
S-1 (the "Registration Statement") with the Securities and Exchange Commission
(the "Commission") for the public offering (the "Offering") of the Common Stock
of the Company. The undersigned further understands that you are contemplating
entering into an Underwriting Agreement with the Company in connection with the
Offering.
In order to induce the Company, you and the other Underwriters to enter
into the Underwriting Agreement and to proceed with the Offering, the
undersigned agrees, for the benefit of the Company, you and the other
Underwriters, that should the Offering be effected the undersigned will not,
without your prior written consent, directly or indirectly, make any offer,
sale, assignment, transfer, encumbrance, contract to sell, grant of an option to
purchase or other disposition of any Common Stock, or any options or warrants to
purchase any shares of Common Stock of the Company, or any securities
convertible into, exchangeable for or that represent the right to receive shares
of Common Stock of the Company, beneficially owned (within the meaning of Rule
13d-3 under the Securities Exchange Act of 1934, as amended) by the undersigned
on the date hereof or hereafter acquired (the "Undersigned's Shares") for a
period of 180 days subsequent to the date of the Underwriting Agreement, other
than (1) Common Stock to
be sold in the Offering, (2) Common Stock to be acquired pursuant to the
"directed shares" program in connection with the Offering, or (3) any securities
acquired in open market transactions after the completion of the Offering.
Notwithstanding the foregoing, the undersigned may transfer the
Undersigned's Shares (i) as a bona fide gift or gifts, provided that the donee
or donees thereof agree to be bound in writing by the restrictions set forth
herein, (ii) to any trust for the direct or indirect benefit of the undersigned
or the immediate family of the undersigned, provided that the trustee of the
trust agrees to be bound in writing by the restrictions set forth herein, and
provided further that any such transfer shall not involve a disposition for
value, or (iii) with the prior written consent of CIBC World Markets Corp. on
behalf of the Underwriters. For purposes of this agreement, "immediate family"
shall mean any relationship by blood, marriage or adoption, not more remote than
first cousin.
The undersigned, whether or not participating in the Offering, confirms
that he, she or it understands that the Underwriters and the Company will rely
upon the representations set forth in this agreement in proceeding with the
Offering. This agreement shall be binding on the undersigned and his, her or its
respective successors, heirs, personal representatives and assigns. The
undersigned agrees and consents to the entry of stop transfer instructions with
the Company's transfer agent against the transfer of Common Stock or securities
convertible into or exchangeable or exercisable for Common Stock held by the
undersigned except in compliance with this agreement.
Very truly yours,
Dated: , 2000
----------------- ----------------------------------------
Authorized Signature
----------------------------------------
Printed Name and Title (if applicable)
