EXHIBIT 1.1
[INSERT NUMBER OF SHARES]
VIACELL, INC.
COMMON STOCK
UNDERWRITING AGREEMENT
______ __, 2004
CREDIT SUISSE FIRST BOSTON LLC
UBS SECURITIES LLC
LAZARD FRERES & CO. LLC
LEERINK XXXXX & COMPANY
As Representatives of the Several Underwriters,
c/o Credit Suisse First Boston LLC
Eleven Madison Avenue
New York, N.Y. 10010-3629
c/o UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Dear Sirs:
1.ViaCell, Inc, a Delaware corporation ("COMPANY"), proposes to issue and
sell [___________] shares ("FIRM SECURITIES") of its Common Stock, $0.01 par
value per share ("SECURITIES"), and also proposes to issue and sell to the
Underwriters, at the option of the Underwriters, an aggregate of not more than
[___________] additional shares ("OPTIONAL SECURITIES") of its Securities as set
forth below. The Firm Securities and the Optional Securities are herein
collectively called the "OFFERED SECURITIES". As part of the offering
contemplated by this Agreement, Credit Suisse First Boston LLC (the "DESIGNATED
UNDERWRITER") has agreed to reserve out of the Firm Securities purchased by it
under this Agreement, up to [___________] shares, for sale to the Company's
directors, officers, employees and other parties associated with the Company
(collectively, "PARTICIPANTS"), as set forth in the Prospectus (as defined
herein) under the heading "Underwriting" (the "DIRECTED SHARE PROGRAM"). The
Firm Securities to be sold by the Designated Underwriter pursuant to the
Directed Share Program (the "DIRECTED SHARES") will be sold by the Designated
Underwriter pursuant to this Agreement at the public offering price. Any
Directed Shares not subscribed for by 5:00 p.m. E.S.T. on the day on which this
Agreement is executed will be offered to the public by the Underwriters as set
forth in the Prospectus. The Company hereby agrees with the several Underwriters
named in Schedule A hereto ("UNDERWRITERS") as follows:
2. Representations and Warranties of the Company. The Company represents
and warrants to, and agrees with, the several Underwriters that:
(a) A registration statement (No. 333-114209) relating to the
Offered Securities, including a form of prospectus, has been filed with
the Securities and Exchange Commission ("COMMISSION") and either (i) has
been declared effective under the Securities Act of 1933, as amended
("ACT") and is not proposed to be amended or (ii) is proposed to be
amended by amendment or post-effective amendment. If such registration
statement ("INITIAL REGISTRATION STATEMENT") has been declared effective,
either (i) an additional registration statement ("ADDITIONAL REGISTRATION
STATEMENT") relating to the Offered Securities may have been filed with
the Commission pursuant to Rule 462(b) ("RULE 462(b)") under the Act and,
if so filed, has become effective upon filing pursuant to such Rule and
the Offered Securities all have been duly registered under the Act
pursuant to the initial registration statement and, if applicable, the
additional registration statement or (ii) such an additional registration
statement is proposed to be filed with the Commission pursuant to Rule
462(b) and will become effective upon filing pursuant to such Rule and
upon such filing the Offered Securities will all have been duly registered
under the Act pursuant to the initial registration statement and such
additional registration statement. If the Company does not propose to
amend the initial registration statement or if an additional registration
statement has been filed and the Company does not propose to amend it, and
if any post-effective amendment to either such registration statement has
been filed with the Commission prior to the execution and delivery of this
Agreement, the most recent amendment (if any) to each such registration
statement has been declared effective by the Commission or has become
effective upon filing pursuant to Rule 462(c) ("RULE 462(C)") under the
Act or, in the case of the additional registration statement, Rule 462(b).
For purposes of this Agreement, "EFFECTIVE TIME" with respect to the
initial registration statement or, if filed prior to the execution and
delivery of this Agreement, the additional registration statement means
(i) if the Company has advised the Representatives that it does not
propose to amend such registration statement, the date and time as of
which such registration statement, or the most recent post-effective
amendment thereto (if any) filed prior to the execution and delivery of
this Agreement, was declared effective by the Commission or has become
effective upon filing pursuant to Rule 462(c), or (ii) if the Company has
advised the Representatives that it proposes to file an amendment or
post-effective amendment to such registration statement, the date and time
as of which such registration statement, as amended by such amendment or
post-effective amendment, as the case may be, is declared effective by the
Commission. If an additional registration statement has not been filed
prior to the execution and delivery of this Agreement but the Company has
advised the Representatives that it proposes to file one, "EFFECTIVE TIME"
with respect to such additional registration statement means the date and
time as of which such registration statement is filed and becomes
effective pursuant to Rule 462(b). "EFFECTIVE DATE" with respect to the
initial registration statement or the additional registration statement
(if any) means the date of the Effective Time thereof. The initial
registration statement, as amended at its Effective Time, including all
information contained in the additional registration statement (if any)
and deemed to be a part of the initial registration statement as of the
Effective Time of the additional registration statement pursuant to the
General Instructions of the Form on which it is filed and including all
information (if any) deemed to be a part of the initial registration
statement as of its Effective Time pursuant to Rule 430A(b) ("RULE
430A(B)") under the Act, is hereinafter referred to as the "INITIAL
REGISTRATION STATEMENT". The additional registration statement, as amended
at its Effective Time, including the contents of the initial registration
statement incorporated by reference therein and including all information
(if any) deemed to be a part of the additional registration statement as
of its Effective Time pursuant to Rule 430A(b), is hereinafter referred to
as the "ADDITIONAL REGISTRATION STATEMENT". The Initial Registration
Statement and
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the Additional Registration Statement are herein referred to collectively
as the "REGISTRATION STATEMENTS" and individually as a "REGISTRATION
STATEMENT". The form of prospectus relating to the Offered Securities, as
first filed with the Commission pursuant to and in accordance with Rule
424(b) ("RULE 424(B)") under the Act or (if no such filing is required) as
included in a Registration Statement, is hereinafter referred to as the
"PROSPECTUS". No document has been or will be prepared or distributed in
reliance on Rule 434 under the Act.
(b) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement: (i) on the
Effective Date of the Initial Registration Statement, the Initial
Registration Statement conformed in all material respects to the
requirements of the Act and the rules and regulations of the Commission
("RULES AND REGULATIONS") and did not include any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, (ii)
on the Effective Date of the Additional Registration Statement (if any),
each Registration Statement conformed, or will conform, in all material
respects to the requirements of the Act and the Rules and Regulations and
did not include, or will not include, any untrue statement of a material
fact and did not omit, or will not omit, to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading and (iii) on the date of this Agreement, the Initial
Registration Statement and, if the Effective Time of the Additional
Registration Statement is prior to the execution and delivery of this
Agreement, the Additional Registration Statement each conforms, and at the
time of filing of the Prospectus pursuant to Rule 424(b) or (if no such
filing is required) at the Effective Date of the Additional Registration
Statement in which the Prospectus is included, each Registration Statement
and the Prospectus will conform, in all material respects to the
requirements of the Act and the Rules and Regulations, and neither of such
documents includes, or will include, any untrue statement of a material
fact or omits, or will omit, to state any material fact required to be
stated therein or necessary to make the statements therein (with respect
to the Prospectus, in light of the circumstances under which they were
made) not misleading. If the Effective Time of the Initial Registration
Statement is subsequent to the execution and delivery of this Agreement:
on the Effective Date of the Initial Registration Statement, the Initial
Registration Statement and the Prospectus will conform in all material
respects to the requirements of the Act and the Rules and Regulations,
neither of such documents will include any untrue statement of a material
fact or will omit to state any material fact required to be stated therein
or necessary to make the statements therein (with respect to the
Prospectus, in light of the circumstances under which they were made) not
misleading, and no Additional Registration Statement has been or will be
filed. The two preceding sentences do not apply to statements in or
omissions from a Registration Statement or the Prospectus based upon
written information furnished to the Company by any Underwriter through
the Representatives specifically for use therein, it being understood and
agreed that the only such information is that described as such in Section
7(b) hereof.
(c) The last preliminary prospectus distributed in connection with
the offering of the Shares, at the time of filing thereof, complied in all
material respects to the requirements of the Act and such preliminary
prospectus did not, as of its date, and does not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.
(d) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with
power and authority (corporate or other) to own its properties and conduct
its business as described in the Prospectus; and the Company is duly
qualified to do business as a foreign corporation in good standing in all
other jurisdictions in which
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its ownership or lease of property or the conduct of its business requires
such qualification, except for such jurisdictions where the failure to so
qualify or to be in good standing would not (i) individually or in the
aggregate, have a material adverse effect on the condition (financial or
other), business, properties, prospects or results of operations of the
Company and its subsidiaries taken as a whole or (ii) prevent the
consummation of the transactions contemplated hereby (the occurrence of
(i) or (ii), a "MATERIAL ADVERSE EFFECT.") Each jurisdiction in which the
Company maintains an office or leases property is listed in Schedule B to
this Agreement.
(e) The Company has no subsidiaries (as defined in the Act) other
than as listed in Schedule B annexed hereto (the subsidiaries listed
therein being referred to herein as the "SUBSIDIARIES"). Each subsidiary
of the Company has been duly incorporated or organized and is an existing
corporation or other business entity, as the case may be, in good standing
(with respect to jurisdictions that recognize such concept) under the laws
of the jurisdiction of its incorporation or organization, as the case may
be, with power and authority (corporate or other) to own its properties
and conduct its business as described in the Prospectus; and each
subsidiary of the Company is duly qualified to do business as a foreign
corporation or other business entity in good standing in all other
jurisdictions in which its ownership or lease of property or the conduct
of its business requires such qualification, except where the failure to
be so qualified would not, individually or in the aggregate, have a
Material Adverse Effect; all of the issued and outstanding capital stock
or other equity interests of each subsidiary of the Company have been duly
authorized and validly issued and are fully paid and nonassessable; and
all of the outstanding capital stock or other equity interests of each
subsidiary is owned by the Company, directly or through subsidiaries, and
is so owned free from liens, encumbrances and defects. No options,
warrants or other rights to purchase, agreements or other obligations to
issue or other rights to convert any obligation into shares of capital
stock or ownership interests in any of the Company's subsidiaries are
outstanding. Except for the Company's subsidiaries or as disclosed in the
Prospectus, the Company does not own, directly or indirectly, any
long-term debt or any equity interest in any firm, corporation,
partnership, joint venture, association or other entity. Each jurisdiction
in which each of the Company's subsidiaries maintains an office or leases
property is listed in Schedule B to this Agreement.
(f) As of the date of this Agreement, the Company has an authorized
and outstanding capitalization as set forth in the section of the
Registration Statement and the Prospectus entitled "Capitalization" and,
as of the First Closing Date (as hereinafter defined) and the Optional
Closing Date (as hereinafter defined), as the case may be, the Company
shall have an authorized and outstanding capitalization as set forth in
the section of the Registration Statement and the Prospectus entitled
"Capitalization" (subject, in each case, to the issuance of shares of
Common Stock upon exercise of stock options and warrants disclosed as
outstanding in the Registration Statement and the Prospectus and grant of
options and compensatory stock grants under equity plans described in the
Registration Statement and the Prospectus).
(g) The Offered Securities and all other outstanding shares of
capital stock of the Company have been duly authorized; all outstanding
shares of capital stock of the Company are, and, when the Offered
Securities have been delivered and paid for in accordance with this
Agreement on each Closing Date (as defined below), such Offered Securities
will have been, validly issued, fully paid and nonassessable and such
Offered Securities will conform to the description thereof contained in
the Prospectus; and the stockholders of the Company have no preemptive,
subscription or similar rights with respect to the Offered Securities,
other than with ARE-One, which rights have been waived, or any outstanding
capital stock or other outstanding securities of the Company. All of the
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issued and outstanding shares of capital stock of the Company have been
issued in compliance in all material respects with all applicable federal
and state securities laws and were not issued in violation of any
preemptive, subscription or similar right.
(h) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person that would
give rise to a valid claim against the Company or any Underwriter for a
brokerage commission, finder's fee or other like payment in connection
with this offering.
(i) Except as disclosed in the Prospectus, there are no contracts,
agreements or understandings between the Company and any person granting
such person the right to require the Company to file a registration
statement under the Act with respect to any securities of the Company
owned or to be owned by such person or to require the Company to include
such securities in any securities being registered pursuant to any other
registration statement filed by the Company under the Act or, except as
have been waived, in the securities registered pursuant to a Registration
Statement.
(j) The Offered Securities have been approved for listing on The
Nasdaq Stock Market's National Market, subject to notice of issuance.
(k) No consent, approval, authorization, or order of, or filing
with, any governmental agency or body or any court, or approval of the
shareholders of the Company, is required for the consummation of the
transactions contemplated by this Agreement in connection with the
issuance and sale of the Offered Securities by the Company, except (i)
such as have been obtained and made under the Act and the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), (ii) such as may be
required to be obtained or made by the Underwriters or their counsel,
including to be obtained from or made with the Corporate Financing
Department of the National Association of Securities Dealers, Inc. and
(iii) such as may be required under state securities laws.
(l) The execution, delivery and performance of this Agreement, and
the issuance and sale of the Offered Securities will not result in a
breach or violation of any of the terms and provisions of, or constitute a
default under (nor an event which, with notice, lapse of time or both
would result in a breach or violation of, or constitute a default under
or, except as described in the Registration Statement and Prospectus
relating to the repayment of the Kourion note, give the holder of any
indebtedness (or a person acting on such holder's behalf) the right to
require the repurchase, redemption or repayment of all or a part of such
indebtedness under), (i) any statute, rule, regulation or order of any
governmental agency or body or any court, domestic or foreign, having
jurisdiction over the Company or any subsidiary of the Company or any of
their properties, or (ii) any agreement or instrument to which the Company
or any such subsidiary is a party or by which the Company or any such
subsidiary is bound or to which any of the properties of the Company or
any such subsidiary is subject, or (iii) the charter or by-laws of the
Company or any such subsidiary, except, with respect to clause (ii), for
such breaches, violations or defaults as would not, individually or in the
aggregate, have a Material Adverse Effect; and the Company has full power
and authority to authorize, issue and sell the Offered Securities as
contemplated by this Agreement.
(m) This Agreement has been duly authorized, executed and delivered
by the Company.
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(n) Except as disclosed in the Prospectus, the Company and its
subsidiaries have good and marketable title to all real properties and all
other material properties and assets owned by them, in each case free from
liens, encumbrances and defects that would materially affect the value
thereof or materially interfere with the use made or to be made thereof by
them; and except as disclosed in the Prospectus or as would not
individually or in the aggregate have a Material Adverse Effect, the
Company and its subsidiaries hold any leased real or personal property
under valid, subsisting and enforceable leases with no exceptions that
would interfere with the use made or to be made thereof by them.
(o) The Company and its subsidiaries have obtained and possess
adequate certificates, licenses, consents, approvals, authorities or
permits ("Business Permits") issued by appropriate governmental agencies
or bodies necessary to conduct the business now operated by them and have
made all necessary filings required under any federal, state, local or
foreign law, regulation or rule, except where the failure to possess such
Business Permits or to make such filings would not, individually or in the
aggregate, result in a Material Adverse Effect. Neither the Company nor
any of its subsidiaries is in breach or violation of or in default under
any such Business Permits and neither the Company nor any of its
subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such Business Permits that, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a "MATERIAL ADVERSE EFFECT".
(p) No labor dispute with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent except
such as would not individually or in the aggregate have a Material Adverse
Effect.
(q) Except as described in the Prospectus, (i) the Company and its
subsidiaries own, or have obtained valid and enforceable licenses for, or
other rights to use, the inventions, patent applications, patents,
trademarks (both registered and unregistered), tradenames, service names,
copyrights, trade secrets and other proprietary information described in
the Prospectus as being owned or licensed by them or which are necessary
for the conduct of their respective businesses as described in the
Registration Statement and the Prospectus or necessary in connection with
the commercialization of the products described in the Registration
Statement and the Prospectus as being under development, except where the
failure to own, license or have such rights would not, individually or in
the aggregate, have a Material Adverse Effect (collectively, "INTELLECTUAL
PROPERTY"); (ii) there are no third parties who have or, to the Company's
knowledge, will be able to establish rights to any intellectual property,
except for the ownership rights of the owners of the intellectual property
which is licensed to the Company or any of its subsidiaries; (iii) to the
Company's knowledge, after reasonable investigation, there is no
infringement by third parties of any intellectual property; (iv) there is
no pending or, to the Company's knowledge, threatened action, suit,
proceeding or claim by others challenging the rights of the Company or any
of its subsidiaries in or to any intellectual property, other than such
actions, suits, proceedings or claims that, if determined adversely to the
Company or any of its subsidiaries, would not individually or in the
aggregate have a Material Adverse Effect; (v) there is no pending or, to
the Company's knowledge, threatened action, suit, proceeding or claim by
others challenging the validity or scope of any intellectual property, and
the Company is unaware of any facts which could form a reasonable basis
for any such action, suit, proceeding or claim, other than such actions,
suits, proceedings or claims that, if determined adversely to the Company
or any of its subsidiaries, would not individually or in the aggregate
have a Material Adverse Effect; (vi) there is no pending or, to the
Company's knowledge, threatened action, suit, proceeding or claim by
others that the
6
Company or any of its subsidiaries infringes, or upon commercialization of
any product described in the Registration Statement or Prospectus as being
under development, would infringe, or otherwise violates, or, except as
would not individually or in the aggregate have a Material Adverse Effect,
upon commercialization of any product described in the Registration
Statement or Prospectus as being under development, would violate any
patent, trademark, tradename, service name, copyright, trade secret or
other proprietary rights of others, and the Company is unaware of any
facts which could form a reasonable basis for any such action, suit,
proceeding or claim; (vii) there is no patent or, to the Company's
knowledge, after reasonable investigation, patent application that
contains claims that interfere with the issued or pending claims of any of
the Intellectual Property; and (viii) except as would not individually or
in the aggregate have a Material Adverse Effect, there is no prior art, to
the Company's knowledge, after reasonable investigation, that may render
any patent application owned by the Company or any of its subsidiaries of
the intellectual property unpatentable.
(r) Neither the Company nor any of its subsidiaries is in breach or
violation of, or in default under (nor has any event occurred which with
notice, lapse of time or both would result in any breach or violation of,
or constitute a default under, or give the holder of any indebtedness (or
a person acting on such holder's behalf) the right to require the
repurchase, redemption or repayment of all or a part of such indebtedness
under) (i) its charter, bylaws or other organizational documents, (ii) any
provision of any license, permit, indenture, mortgage, deed of trust, bank
loan or credit agreement or other evidence of indebtedness, or any lease,
contract or other agreement or instrument to which the Company or any of
its subsidiaries is a party or by which any of them or any of their
respective properties may be bound or affected, (iii) any federal, state,
local or foreign law, regulation or rule or any rule or regulation of any
self-regulatory organization or other non-governmental regulatory
authority (including, but not limited to, the Nasdaq), or (iv) any decree,
judgment or order applicable to the Company, any of its subsidiaries or
any of their respective properties, except, in the case of clauses (ii),
(iii) and (iv) above, for any such breach, violation or default that would
not, individually or in the aggregate, have a Material Adverse Effect.
(s) All legal or governmental proceedings, contracts, leases,
documents, affiliate transactions or off-balance sheet transactions
(including, without limitation, any "variable interests" in "variable
interest entities," as such terms are defined in Financial Accounting
Standards Board Interpretation No. 46) of a character required to be
disclosed in the Prospectus or to be filed as an exhibit to the
Registration Statement have been so disclosed or filed as required. Except
as disclosed in the Prospectus, there are no actions, suits, claims,
investigations or proceedings pending or to the Company's knowledge,
threatened to which the Company or any of its subsidiaries or any of their
respective directors or officers is a party or of which any of their
respective properties is subject at law or in equity, or before or by any
federal, state, local or foreign governmental commission, board, body,
authority or agency, or before or by any self-regulatory organization or
other non-governmental regulatory authority (including, but not limited
to, the Nasdaq), which, if adversely decided, could, individually or in
the aggregate, result in a judgment, decree or order having, a Material
Adverse Effect.
(t) Except as disclosed in the Prospectus, neither the Company nor
any of its subsidiaries is in violation of any statute, any rule,
regulation, decision or order of any governmental agency or body or any
court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances or relating to the protection or restoration
of the environment or human exposure to hazardous or toxic substances
(collectively, "ENVIRONMENTAL LAWS"), owns or operates any real property
contaminated with any substance that is subject to any environmental laws,
is liable for
7
any off-site disposal or contamination pursuant to any environmental laws,
or is subject to any claim relating to any environmental laws, which
violation, contamination, liability or claim would individually or in the
aggregate have a Material Adverse Effect; and the Company is not aware of
any pending investigation which might lead to such a claim.
(u) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or, to the knowledge of the Company,
affecting the Company, any of its subsidiaries or any of their respective
properties that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a Material
Adverse Effect; and to the Company's knowledge no such actions, suits or
proceedings are threatened or contemplated.
(v) The financial statements included in each Registration Statement
and the Prospectus present fairly the financial position of the Company
and its consolidated subsidiaries as of the dates shown and their results
of operations and cash flows for the periods shown, and, except as
otherwise disclosed in the Prospectus, such financial statements have been
prepared in compliance in all material respects with the requirements of
the Act and in conformity with the generally accepted accounting
principles in the United States applied on a consistent basis; any
schedules included in each Registration Statement present fairly the
information required to be stated therein; any pro forma financial
information or data included in the Registration Statement or the
Prospectus comply as to form in all material respects with the applicable
accounting requirements of Regulation S-X of the Act, and the assumptions
used in preparing the pro forma financial information included in each
Registration Statement and the Prospectus provide a reasonable basis for
presenting the significant effects directly attributable to the
transactions or events described therein, the related pro forma
adjustments give appropriate effect to those assumptions, and the pro
forma columns therein reflect the proper application of those adjustments
to the corresponding historical financial statement amounts; there are no
financial statements (historical or pro forma) that are required to be
included in the Registration Statement or the Prospectus that are not so
included or incorporated by reference as required. PricewaterhouseCoopers
LLP, whose report on the consolidated financial statements of the Company
and the subsidiaries, and on Kourion Therapeutics AG ("KOURION"), is
included in the Registration Statement and the Prospectus, are independent
public accountants as required by the Act. All disclosures contained in
the Registration Statement or the Prospectus regarding "non-GAAP financial
measures" (as such term is defined by the rules and regulations of the
Commission) comply with Regulation G of the Securities Exchange Act of
1934, as amended ("EXCHANGE ACT") and Item 10 of Regulation S-K under the
Act, to the extent applicable.
(w) Except as disclosed in the Prospectus, since the date of the
latest audited financial statements included in the Prospectus there has
been no material adverse change, nor any development or event involving a
prospective material adverse change, in the condition (financial or
other), business, properties or results of operations of the Company and
its subsidiaries taken as a whole, and, except as disclosed in or
contemplated by the Prospectus, there has been no dividend or distribution
of any kind declared, paid or made by the Company on any class of its
capital stock.
(x) The Company after this offering will be subject to the reporting
requirements of either Section 13 or Section 15(d) of the Exchange Act and
will file the reports of the Company required thereby with the Commission
on the Electronic Data Gathering, Analysis, and Retrieval (XXXXX) system.
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(y) Neither the Company nor any of its subsidiaries is nor, after
giving effect to the offering and sale of the Offered Securities and the
application of the proceeds thereof as described in the Prospectus, will
be an "investment company" or an entity "controlled" by an "investment
company" as such terms are defined in the Investment Company Act of 1940,
as amended.
(z) The Registration Statement, the Prospectus and any preliminary
prospectus comply, and any further amendments or supplements thereto will
comply, with any applicable laws or regulations of foreign jurisdictions
in which the Prospectus or any preliminary prospectus, as amended or
supplemented, if applicable, are distributed in connection with the
Directed Share Program; and no authorization, approval, consent, license,
order, registration or qualification of or with any government,
governmental instrumentality or court, other than such as have been
obtained, is necessary under the securities law and regulations of foreign
jurisdictions in which the Directed Shares are offered outside the United
States.
(aa) The Company has not offered, or caused the Underwriters to
offer, any Offered Securities to any person pursuant to the Directed Share
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.
(bb) Any statistical and market-related data included in the
Prospectus are based on or derived from sources that the Company has
reason to believe to be reliable, and the Company has obtained the written
consent to the use of such data from such sources to the extent required.
(cc) Neither the Company nor any of its affiliates has distributed
any offering material or any "prospectus" (within the meaning of the Act)
in connection with the offer or sale of the Offered Securities other than
the Registration Statement, the preliminary prospectus, the most recent
Prospectus or such other materials, if any, as may be permitted by the
Act; and neither the Company nor any of the subsidiaries nor any of their
respective affiliates has taken, directly or indirectly, any action
designed to or which has constituted or which might reasonably be expected
to cause or result, under the Exchange Act, or otherwise, in the
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Offered Securities.
(dd) Immediately after the issuance and sale of the Offered
Securities to the Underwriters, no shares of preferred stock of the
Company shall be issued and outstanding, and no holder of any shares of
capital stock, securities convertible into or exchangeable or exercisable
for capital stock or options, warrants or other rights to purchase capital
stock or any other securities of the Company shall have any existing or
future right to acquire any shares of preferred stock of the Company.
(ee) The Company and each of its subsidiaries maintain insurance of
the types and in amounts reasonably adequate for their respective
businesses, including, but not limited to, insurance covering real and
personal property owned or leased by the Company and each of the
subsidiaries against theft, damage, destruction, acts of vandalism and
other risks customarily insured against, all of which insurance is in full
force and effect.
(ff) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included in the
Prospectus any losses or interferences with its business from fire,
explosion, flood or other calamity, whether or not covered by insurance,
or from any
9
labor dispute or court or governmental action, order or decree, otherwise
than disclosed in the Prospectus or other than any losses or interferences
which would not, individually or in the aggregate, have a Material Adverse
Effect.
(gg) Neither the Company nor any of the subsidiaries has violated
any foreign, federal, state or local law or regulation relating to the
protection of human health and safety, nor any federal or state law
relating to discrimination in the hiring, promotion or pay of employees
nor any applicable federal or state wages and hours laws, nor any
provisions of the Employee Retirement Income Security Act or any similar
law or any rules and regulations promulgated thereunder, which violations
would, individually or in the aggregate, have a Material Adverse Effect.
(hh) The Company and each of its subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance
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 conformity 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.
(ii) The Company, its subsidiaries and the Company's directors and
officers each are in compliance in all material respects with all
applicable provisions of the Xxxxxxxx-Xxxxx Act and the rules and
regulations of the Commission and the Nasdaq promulgated thereunder. The
Company has established and maintains and evaluates "disclosure controls
and procedures" (as such term is defined in Rule 13a-15 and 15d-15 under
the Exchange Act) and "internal control over financial reporting" (as such
term is defined in Rule 13a-15 and 15d-15 under the Exchange Act); such
disclosure controls and procedures are designed to ensure that material
information relating to the Company, including its consolidated
subsidiaries, is made known to the Company's Chief Executive Officer and
its Chief Financial Officer by others within those entities, and such
disclosure controls and procedures are effective to perform the functions
for which they were established; the Company's auditors and the Audit
Committee of the Board of Directors of the Company have been advised of:
(i) any significant deficiencies in the design or operation of internal
controls which could adversely affect the Company's ability to record,
process, summarize, and report financial data; and (ii) any fraud, whether
or not material, that involves management or other employees who have a
role in the Company's internal controls; all material weaknesses in
internal controls have been identified for the Company's auditors; since
the date of the most recent evaluation of such disclosure controls and
procedures, there have been no significant changes in internal controls or
in other factors that could significantly affect internal controls,
including any corrective actions with regard to significant deficiencies
and material weaknesses.
(jj) The Company has provided you true, correct and complete copies
of all documentation pertaining to any extension of credit in the form of
a personal loan made, directly or indirectly, by the Company or any of its
subsidiaries to any director or executive officer of the Company, or to
any family member or affiliate of any director or executive officer of the
Company. On or after July 30, 2002, the Company has not, directly or
indirectly, including through any of its subsidiaries: (i) extended
credit, arranged to extend credit, or renewed any extension of credit, in
the form of a personal loan, to or for any director or executive officer
of the Company, or to or for any family member or affiliate of any
director or executive officer of the Company; or (ii) made
10
any material modification, including any renewal thereof, to any term of
any personal loan to any director or executive officer of the Company, or
any family member or affiliate of any director or executive officer, which
loan was outstanding on July 30, 2002.
(kk) All tax returns required to be filed by the Company and each of
its subsidiaries have been filed, except where such failure to file would
not, individually or in the aggregate, have a Material Adverse Effect, and
all taxes, including withholding taxes, penalties and interest,
assessments, fees and other charges due pursuant to such returns or
pursuant to any assessment received by the Company or any of its
subsidiaries have been paid, except where such failure to pay would not,
individually or in the aggregate, have a Material Adverse Effect.
(ll) The clinical, pre-clinical and other studies and tests
conducted by or on behalf of or sponsored by the Company or any of its
subsidiaries or in which the Company, any of its subsidiaries or its
products or product candidates have participated ("COMPANY STUDIES") that
are described in the Prospectus or the results of which are referred to in
the Prospectus were and, if still pending, are being conducted in all
material respects in accordance with standard medical and scientific
research procedures; the descriptions in the Prospectus of the results of
such studies and tests are accurate and complete in all material respects
and fairly present the data derived from such studies and tests, and the
Company has no knowledge of any other studies or tests the results of
which are inconsistent with or otherwise call into question the results
described or referred to in the Prospectus; except to the extent disclosed
in the Registration Statement and the Prospectus, the Company and each of
its subsidiaries has operated and currently is in compliance in all
material respects with all applicable rules, regulations and policies of
the U.S. Food and Drug Administration and comparable drug regulatory
agencies outside of the United States (collectively, the "REGULATORY
AUTHORITIES"); and except to the extent disclosed in the Registration
Statement and the Prospectus, neither the Company nor any of its
subsidiaries has received any notice or other correspondence from any
Regulatory Authority or any other governmental agency requiring the
termination, suspension or material modification of any Company Studies
that are described in the Prospectus or the results of which are referred
to in the Prospectus.
(mm) Neither the Company nor any of its subsidiaries has sent or
received any notice of termination of any of the material contracts or
agreements referred to or described in the Prospectus as being currently
in effect, or filed as an exhibit to the Registration Statement, and no
such termination has been threatened by the Company or any of its
subsidiaries or, to the knowledge of the Company, any other party to any
such contract or agreement.
(nn) Neither the Company nor any of its subsidiaries nor, to the
Company's knowledge, any employee or agent (in its capacity as such) of
the Company or any of its subsidiaries has made any payment of funds of
the Company or any of its subsidiaries or received or retained any funds
in violation of any law, rule or regulation, which payment, receipt or
retention of funds is of a character required to be disclosed in the
Prospectus.
(oo) To the Company's knowledge, there are no affiliations or
associations between any member of the National Association of Securities
Dealers, Inc. (the "NASD") and the Company or any of the Company's
officers, directors or securityholders, that are required to be set forth
in the Registration Statement and the Prospectus that are not so set forth
as required.
11
In addition, any certificate signed by any officer of the Company and
delivered to you or counsel for the Underwriters in connection with the offering
of the Offered Securities shall be deemed to be a representation and warranty by
the Company, as to matters covered thereby, to each Underwriter.
3.Purchase, Sale and Delivery of Offered Securities. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to purchase
from the Company, at a purchase price of $ [__] per share, the numbers of shares
of Firm Securities set forth opposite the respective names of the Underwriters
in Schedule A hereto.
The Company will deliver the Firm Securities to the Representatives,
through the facilities of the Depository Trust Company ("DTC") unless the
Representatives shall otherwise instruct, for the accounts of the Underwriters,
against payment of the purchase price in Federal (same day) funds by official
bank check or checks or wire transfer to an account at a bank acceptable to
Credit Suisse First Boston LLC ("CSFB") and UBS Securities LLC ("UBS") drawn to
the order of [___________] at the office of Xxxxx Xxxxxxxxxx LLP, 0000 Xxxxxx xx
xxx Xxxxxxxx, Xxx Xxxx, XX 00000, at [_____] A.M., New York time, on
[___________], or at such other time not later than seven full business days
thereafter as CSFB, UBS and the Company determine, such time being herein
referred to as the "FIRST CLOSING DATE". For purposes of Rule 15c6-1 under the
Exchange Act, the First Closing Date (if later than the otherwise applicable
settlement date) shall be the settlement date for payment of funds and delivery
of securities for all the Offered Securities sold pursuant to the offering. The
certificates for the Firm Securities so to be delivered will be in definitive
form, in such denominations and registered in such names as CSFB and UBS request
and will be made available for checking and packaging at the office of DTC or
its designated custodian at least 24 hours prior to the First Closing Date.
In addition, upon written notice from CSFB and UBS given to the Company
from time to time not more than 30 days subsequent to the date of the
Prospectus, the Underwriters may purchase all or less than all of the Optional
Securities at the purchase price per Security to be paid for the Firm
Securities. The Company agrees to sell to the Underwriters the number of shares
of Optional Securities specified in such notice and the Underwriters agree,
severally and not jointly, to purchase such Optional Securities. Such Optional
Securities shall be purchased for the account of each Underwriter in the same
proportion as the number of shares of Firm Securities set forth opposite such
Underwriter's name bears to the total number of shares of Firm Securities
(subject to adjustment by CSFB and UBS to eliminate fractions) and may be
purchased by the Underwriters only for the purpose of covering over-allotments
made in connection with the sale of the Firm Securities. No Optional Securities
shall be sold or delivered unless the Firm Securities previously have been, or
simultaneously are, sold and delivered. The right to purchase the Optional
Securities or any portion thereof may be exercised from time to time and to the
extent not previously exercised may be surrendered and terminated at any time
upon notice by CSFB and UBS to the Company.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "OPTIONAL CLOSING DATE", which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "CLOSING DATE"), shall be determined by CSFB
and UBS but shall be not later than five full business days after written notice
of election to purchase Optional Securities is given. The Company will deliver
the Optional Securities being purchased on each Optional Closing Date to the
Representatives for the accounts of the several Underwriters, at the office of
Xxxxx Xxxxxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000 against
payment of the purchase price therefor in Federal (same day) funds by official
bank check or checks or wire transfer to an account at a bank acceptable to CSFB
and UBS drawn to the order of [___________], at the above office Xxxxx
Xxxxxxxxxx LLP. The Optional Securities being purchased on each Optional Closing
Date will be in
12
definitive form, in such denominations and registered in such names as CSFB and
UBS request upon reasonable notice prior to such Optional Closing Date and will
be made available for checking and packaging at the office of DTC or its
designated custodian at a reasonable time in advance of such Optional Closing
Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Offered Securities for sale to the public as
set forth in the Prospectus.
5. Certain Agreements of the Company. The Company agrees with the several
Underwriters that:
(a) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement, the Company will
file the Prospectus with the Commission pursuant to and in accordance with
subparagraph (1) (or, if applicable and if consented to by CSFB and UBS,
subparagraph (4); such consent not to be unreasonably withheld)of Rule
424(b) not later than the earlier of (A) the second business day following
the execution and delivery of this Agreement or (B) the fifteenth business
day after the Effective Date of the Initial Registration Statement.
The Company will advise CSFB and UBS promptly of any such filing pursuant
to Rule 424(b). If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement and an
additional registration statement is necessary to register a portion of
the Offered Securities under the Act but the Effective Time thereof has
not occurred as of such execution and delivery, the Company will file the
additional registration statement or, if filed, will file a post-effective
amendment thereto with the Commission pursuant to and in accordance with
Rule 462(b) on or prior to 10:00 P.M., New York time, on the date of this
Agreement or, if earlier, on or prior to the time the Prospectus is
printed and distributed to any Underwriter, or will make such filing at
such later date as shall have been consented to by CSFB and UBS.
(b) The Company will advise CSFB and UBS promptly of any proposal to
amend or supplement the initial or any additional registration statement
as filed or the related prospectus or the Initial Registration Statement,
the Additional Registration Statement (if any) or the Prospectus and will
not effect such amendment or supplementation without the consent of CSFB
and UBS, which consent will not be unreasonably withheld; and the Company
will also advise CSFB and UBS promptly of the effectiveness of each
Registration Statement (if its Effective Time is subsequent to the
execution and delivery of this Agreement) and of any amendment or
supplementation of a Registration Statement or the Prospectus and of the
institution by the Commission of any stop order proceedings in respect of
a Registration Statement and will use its best efforts to prevent the
issuance of any such stop order and to obtain as soon as possible its
lifting, if issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with
sales by any Underwriter or dealer, any event occurs as a result of which
the Prospectus as then amended or supplemented would include an 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 is necessary at any time to
amend the Prospectus to comply with the Act, the Company will promptly
notify CSFB and UBS of such event and will promptly prepare and file with
the Commission, at its own expense, an amendment or supplement which will
correct such statement or omission or an amendment which will effect such
compliance. Neither the consent of CSFB and UBS to, nor the
13
Underwriters' delivery of, any such amendment or supplement shall
constitute a waiver of any of the conditions set forth in Section 6
hereof.
(d) As soon as practicable, but not later than the Availability Date
(as defined below), the Company will make generally available to its
securityholders an earnings statement covering a period of at least 12
months beginning after the Effective Date of the Initial Registration
Statement (or, if later, the Effective Date of the Additional Registration
Statement) which will satisfy the provisions of Section 11(a) of the Act.
For the purpose of the preceding sentence, "AVAILABILITY DATE" means the
45th day after the end of the fourth fiscal quarter following the fiscal
quarter that includes such Effective Date, except that, if such fourth
fiscal quarter is the last quarter of the Company's fiscal year,
"AVAILABILITY DATE" means the 90th day after the end of such fourth fiscal
quarter.
(e) The Company will furnish to the Representatives copies of each
Registration Statement (of which five will be signed and will include all
exhibits), each related preliminary prospectus, and, so long as a
prospectus relating to the Offered Securities is required to be delivered
under the Act in connection with sales by any Underwriter or dealer, the
Prospectus and all amendments and supplements to such documents, in each
case in such quantities as CSFB and UBS request. The Prospectus shall be
so furnished on or prior to 3:00 P.M., New York time, on the business day
following the later of the execution and delivery of this Agreement or the
Effective Time of the Initial Registration Statement. All other documents
shall be so furnished as soon as available. The Company will pay the
expenses of printing and distributing to the Underwriters all such
documents.
(f) The Company will arrange for the qualification of the Offered
Securities for sale under the laws of such jurisdictions as CSFB and UBS
designate and will continue such qualifications in effect so long as
required for the distribution; provided that the Company will not be
required to execute a general consent to service of process or be subject
to general taxation in excess of a de minimus amount under the laws of any
such state in order to effect such qualification (except service of
process with respect to the offering and sale of the Offered Securities).
(g) The Company will pay all expenses incident to the performance of
its obligations under this Agreement, for any filing fees and other
expenses (including fees and disbursements of counsel) incurred in
connection with qualification of the Offered Securities for sale under the
laws of such jurisdictions as CSFB and UBS designate and the printing of
memoranda relating thereto, for the filing fee incident to the review by
the National Association of Securities Dealers, Inc. of the Offered
Securities, for any travel expenses of the Company's officers and
employees and any other expenses of the Company in connection with
attending or hosting meetings with prospective purchasers of the Offered
Securities, (including the cost of any aircraft chartered in connection
with attending or hosting such meetings, and for expenses incurred in
distributing preliminary prospectuses and the Prospectus (including any
amendments and supplements thereto) to the Underwriters.
(h) For a period of 180 days after the date of the initial public
offering of the Offered Securities, the Company will not offer, sell,
contract to sell, pledge or otherwise dispose of, directly or indirectly,
or file with the Commission a registration statement under the Act
relating to, any additional shares of its Securities or securities
convertible into or exchangeable or exercisable for any shares of its
Securities, or publicly disclose the intention to make any such offer,
sale, pledge, disposition or filing, without the prior written consent of
CSFB and UBS, except (i)
14
issuances of Securities pursuant to the exercise or satisfaction of
warrants, options or other rights to acquire securities, in each case
outstanding or issued under equity-based compensation plans existing on
the date hereof (including the Company's Equity Incentive Plan and the
Company's Employee Stock Purchase Plan) or written contracts existing on
the date hereof (including the agreement to issue warrants to purchase up
to 2,190,000 shares of common stock referred to under "Capitalization" in
the Registration Statement) (provided, in each case, the recipients have
entered into lock-up agreements substantially in the form of Exhibit A
attached hereto prior to the issuance of such securities), (ii) grants of
stock-based awards, pursuant to the terms of a plan in effect on the date
hereof, (provided, in each case, the recipients have entered into lock-up
agreements substantially in the form of Exhibit A attached hereto prior to
the grant or issuance of such securities), (iii) issuances of Securities
in connection with strategic licensing of or acquisitions of intellectual
property, technologies or businesses or establishment of strategic
partnerships or collaborations complementary to the Company's business
(provided, in each case, the recipients of such Securities have entered
into lock-up agreements substantially in the form of Exhibit A attached
hereto prior to the issuance of such Securities) and (iv) the registration
on Form S-8 of securities issuable pursuant to outstanding options and/or
currently in-effect equity plans of the Company described in the
Registration Statement and the Prospectus.
(i) In connection with the Directed Share Program, the Company will
ensure that the Directed Shares will be restricted to the extent required
by the NASD or the NASD rules. The Designated Underwriter will notify the
Company as to which Participants will need to be so restricted.
(j) The Company will pay all fees and disbursements of counsel
incurred by the Underwriters in connection with the Directed Shares
Program and stamp duties, similar taxes or duties or other taxes, if any,
incurred by the Underwriters in connection with the Directed Share
Program.
(k) The Company will apply the net proceeds from the sale of the
Offered Securities in the manner set forth under the caption "Use of
Proceeds" in the Prospectus.
(l) The Company will furnish to its stockholders as soon as
practicable after the end of each fiscal year an annual report (including
a consolidated balance sheet, statement of income, stockholders' equity
and cash flows of the Company and its subsidiaries for such fiscal year,
accompanied by a copy of the report thereon of nationally recognized
independent certified public accountants duly registered with the Public
Company Oversight Accounting Board).
(m) The Company will maintain a transfer agent and, if necessary
under the jurisdiction of incorporation of the Company, a registrar for
the Common Stock.
Furthermore, the company covenants with the Underwriters that the
company will comply with all applicable securities and other applicable
laws, rules and regulations in each foreign jurisdiction in which the
Directed Shares are offered in connection with the Directed Share Program.
6.Conditions of the Obligations of the Underwriters. The obligations of
the several Underwriters to purchase and pay for the Firm Securities on the
First Closing Date and the Optional Securities to be purchased on each Optional
Closing Date will be subject to the accuracy of the representations and
warranties on the part of the Company herein, to the accuracy of the statements
of Company officers made pursuant to the provisions hereof, to the performance
by the Company of its obligations hereunder and to the following additional
conditions precedent:
15
(a) The Representatives shall have received a letter, dated the date
of delivery thereof (which, if the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement, shall be on or prior to the date of this Agreement or, if the
Effective Time of the Initial Registration Statement is subsequent to the
execution and delivery of this Agreement, shall be prior to the filing of
the amendment or post-effective amendment to the registration statement to
be filed shortly prior to such Effective Time), of PricewaterhouseCoopers
LLP ("PWC") confirming that they are independent public accountants with
respect to the Company within the meaning of the Act and the applicable
published Rules and Regulations thereunder and stating to the effect that:
(i) in their opinion the financial statements and schedules of the
Company examined by them and included in the Registration Statements
comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published Rules
and Regulations;
(ii) for purposes of the letter they have read the 2004 minutes of
the meetings of the stockholders and the board of directors, and any
committees thereof, of the Company and its subsidiaries as set forth
in the minute books at ____, 2004, officials of the Company having
advised PWC that the minutes of all such meetings through that date
were set forth therein. PWC shall carry out other procedures to
____, 2004 (PWC's work need not extend to the period from ___, 2004
to ____, 2004, inclusive):
(A) with respect to the nine month periods ending
September 30, 2004 and 2003, they have:
(I) performed the procedures specified by the
American Institute of Certified Public Accountants for a
review of interim financial information as described in
Statement of Auditing Standards No. 100, Interim
Financial Information, on the unaudited consolidated
balance sheet as of September 30, 2004, and the
unaudited consolidated statements of income, retained
earnings (stockholders' equity), and cash flows for the
nine month periods ended September 30, 2004 and 2003, of
the Company included in the Registration Statement;
(II) inquired of certain officials of the Company
who have responsibility for financial and accounting
matters whether the unaudited condensed consolidated
financial statements referred to in (A)(I) above comply
as to form in all material respects with the applicable
accounting requirements of the Act and the related
published Rules and Regulations;
(B) with respect to the period from October 1, 2004 to
[November 30], 2004 [revise for latest available monthly
financial statements], they have:
(I) read the unaudited consolidated financial
statements of the Company and its subsidiaries for
October and November of both 2003 and 2004 [revise for
latest available monthly financial statements] furnished
to PWC by the Company, officials having advised them
that no such financial statements as of any date or for
any period subsequent
16
to [November 30], 2004 [revise for latest available
monthly financial statements], were available;
(II) inquired of certain officials of the Company
who have responsibility for financial and accounting
matters whether the unaudited consolidated financial
statements referred to in (B)(I) above are stated on a
basis substantially consistent with that of the audited
consolidated financial statements included in the
Registration Statement.
(iii) nothing came to their attention that caused them to believe
that:
(A) (I) any material modifications should be made
to the unaudited condensed financial statements
described in Section 6(a)(ii)(A)(I), included in the
Registration Statement, for them to be in conformity
with generally accepted accounting principles;
(II) the unaudited condensed financial statements
described in 6(a)(ii)(A)(I) do not comply as to form in
all material respects with the applicable accounting
requirements of the Act and the related published Rules
and Regulations;
(B) (I) at [November 30], 2004 [revise for latest
available monthly financial statements], there was any
change in the capital stock, increase in long-term debt,
or decrease in consolidated net current assets or
stockholder's equity of the consolidated companies as
compared with the amounts shown at September 30, 2004,
unaudited consolidated balance sheet included in the
Registration Statement, or
(II) for the period from October 1, 2004 to
[November 30], 2004 [revise for latest available monthly
financial statements], there were any decreases, as
compared to the corresponding period in the preceding
year, in consolidated net sales or in the total or
per-share amounts of income before extraordinary items
or of net income, except in all instances for changes,
increases, or decreases that the registration statement
discloses have occurred or may occur.
(iv) As mentioned in Section 6(a)(ii)(B), Company officials have
advised them that no consolidated financial statements as of any
date or for any period subsequent to [November 30], 2004 [revise for
latest available monthly financial statements] are available;
accordingly, the procedures carried out by us with respect to
changes in financial statement items after November 30, 2004, have,
of necessity, been even more limited than those with respect to the
periods referred to in (ii). They have inquired of certain officials
of the Company who have responsibility for financial and accounting
matters whether (a) at _________, 2004, there was any change in the
capital stock, increase in long-term debt or any decreases in
consolidated net current assets or stockholders' equity of the
consolidated companies as compared with amounts shown on the
September 30, 2004, unaudited consolidated balance sheet included in
the Registration Statement or (b) for the period from October 1,
2004 to __________, 2004
17
there was any decrease, as compared with the corresponding period in
the preceding year, in consolidated net sales or in the total or
per-share amounts of income before extraordinary items or of net
income. On the basis of these inquiries and their reading of the
minutes described in (ii), nothing came to their attention that
caused them to believe that there was any such change, increase, or
decrease, except in all instances for changes, increases, or
decreases that the Registration Statement discloses have occurred or
may occur.
(v) With respect to the unaudited pro forma combined statements of
income for the year ended December 31, 2003, included in the
Registration Statement:
(A) they have read the unaudited pro forma combined financial
statements;
(B) they have inquired of certain officials of the Company and
of Kourion Therapeutics AG who have responsibility for
financial and accounting matters about:
(I) the basis for their determination of the pro forma
adjustments, and
(II) whether the unaudited pro forma combined financial
statements comply as to form in all material respects
with the applicable accounting requirements of rule
11-02 of Regulation S-X;
(C) they have proved the arithmetic accuracy of the
application of the pro forma adjustments to the historical
amounts in the unaudited pro forma combined financial
statements.
Nothing came to their attention as a result of the procedures
specified in this Section 6(a)(v), however, that caused them to
believe that the unaudited pro forma combined financial statements
included in the Registration Statement do not comply as to form in
all material respects with the applicable accounting requirements of
rule 11-02 of Regulation S-X and that the pro forma adjustments have
not been properly applied to the historical amounts in the
compilation of those statements.
(vi) they have read the items in the Registration Statement
identified by the Underwriters and have performed procedures that
compare and agree those items back to the audited financial
statements or accounting records of the Company.
For purposes of this subsection, (i) if the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of this
Agreement, "REGISTRATION STATEMENTS" shall mean the initial registration
statement as proposed to be amended by the amendment or post-effective
amendment to be filed shortly prior to its Effective Time, (ii) if the
Effective Time of the Initial Registration Statement is prior to the
execution and delivery of this Agreement but the Effective Time of the
Additional Registration is subsequent to such execution and delivery,
"REGISTRATION STATEMENTS" shall mean the Initial Registration Statement
and the additional registration statement as proposed to be filed or as
proposed to be amended by the post-effective
18
amendment to be filed shortly prior to its Effective Time, and (iii)
"PROSPECTUS" shall mean the prospectus included in the Registration
Statements.
(b) The Representatives shall have received a letter, dated the date
of delivery thereof (which, if the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement, shall be on or prior to the date of this Agreement or, if the
Effective Time of the Initial Registration Statement is subsequent to the
execution and delivery of this Agreement, shall be prior to the filing of
the amendment or post-effective amendment to the registration statement to
be filed shortly prior to such Effective Time) of PricewaterhouseCoopers
LLP confirming that they are independent public accountants with respect
to Kourion within the meaning of the Act and the applicable published
Rules and Regulations thereunder and stating to the effect that:
(i) in their opinion the Kourion financial statements and schedules
examined by them and included in the Registration Statements comply
as to form in all material respects with the applicable accounting
requirements of the Act and the related published Rules and
Regulations;
(ii) they have read the items in the Registration Statement
identified by the Underwriters and have performed procedures that
compare and agree those items back to the audited financial
statements or accounting records of Kourion.
(c) If the Effective Time of the Initial Registration Statement is
not prior to the execution and delivery of this Agreement, such Effective
Time shall have occurred not later than 10:00 P.M., New York time, on the
date of this Agreement or such later date as shall have been consented to
by CSFB and UBS. If the Effective Time of the Additional Registration
Statement (if any) is not prior to the execution and delivery of this
Agreement, such Effective Time shall have occurred not later than 10:00
P.M., New York time, on the date of this Agreement or, if earlier, the
time the Prospectus is printed and distributed to any Underwriter, or
shall have occurred at such later date as shall have been consented to by
CSFB and UBS. If the Effective Time of the Initial Registration Statement
is prior to the execution and delivery of this Agreement, the Prospectus
shall have been filed with the Commission in accordance with the Rules and
Regulations and Section 5(a) of this Agreement. Prior to such Closing
Date, no stop order suspending the effectiveness of a Registration
Statement shall have been issued and no proceedings for that purpose shall
have been instituted or, to the knowledge of the Company or the
Representatives, shall be threatened or contemplated by the Commission.
(d) Subsequent to the execution and delivery of this Agreement,
there shall not have occurred (i) any change, or any development or event
involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries taken as one enterprise which, in the judgment of a majority
in interest of the Underwriters including the Representatives, is material
and adverse and makes it impractical or inadvisable to proceed with
completion of the public offering or the sale of and payment for the
Offered Securities; (ii) any downgrading in the rating of any debt
securities or preferred stock of the Company by any "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g)
under the Act), or any public announcement that any such organization has
under surveillance or review its rating of any debt securities or
preferred stock of the Company (other than an announcement with positive
implications of a possible upgrading, and no implication of a possible
downgrading, of such rating); (iii) any change in U.S. or international
financial, political
19
or economic conditions or currency exchange rates or exchange controls as
would, in the judgment of a majority in interest of the Underwriters
including the Representatives, be likely to prejudice materially the
success of the proposed issue, sale or distribution of the Offered
Securities, whether in the primary market or in respect of dealings in the
secondary market; (iv) any material suspension or material limitation of
trading in securities generally on the New York Stock Exchange, or any
setting of minimum prices for trading on such exchange; (v) or any
suspension of trading of any securities of the Company on any exchange or
in the over-the-counter market; (vi) any banking moratorium declared by
U.S. Federal or, New York authorities; (vii) any major disruption of
settlements of securities or clearance services in the United States or
(viii) any attack on, outbreak or escalation of hostilities or act of
terrorism involving the United States, any declaration of war by Congress
or any other national or international calamity or emergency if, in the
judgment of a majority in interest of the Underwriters including the
Representatives, the effect of any such attack, outbreak, escalation, act,
declaration, calamity or emergency makes it impractical or inadvisable to
proceed with completion of the public offering or the sale of and payment
for the Offered Securities.
(e) The Representatives shall have received a letter, dated the date
of delivery thereof (which, if the Effective Time of the Initial
Registration Statement is prior to the execution and delivery of this
Agreement, shall be on or prior to the date of this Agreement or, if the
Effective Time of the Initial Registration Statement is subsequent to the
execution and delivery of this Agreement, shall be prior to the filing of
the amendment or post-effective amendment to the registration statement to
be filed shortly prior to such Effective Time) of the chief financial
officer of the Company, in the form set forth in Exhibit B hereto.
(f) The Representatives shall have received an opinion, dated such
Closing Date, of Ropes & Xxxx LLP, counsel for the Company, to the effect
that:
(i) The Company has been duly incorporated and is a validly
existing corporation in good standing under the laws of the state of
Delaware, with corporate power to own its properties and conduct its
business as described in the Prospectus. The Company is duly
qualified to do business as a foreign corporation in good standing
in each jurisdiction identified in Annex A-1 to such opinion (such
Annex to identify each U.S. jurisdiction where the Company is
qualified as a foreign corporation, as listed in Schedule B to this
Agreement);
(ii) Each subsidiary of the Company, as listed in Schedule B
annexed hereto, (other than subsidiaries organized in a jurisdiction
outside of the United States, as to which such counsel need express
no opinion pursuant to this clause (ii)) is an existing corporation
or other business entity in good standing under the laws of the
jurisdiction of its incorporation, with corporate power to own its
properties and conduct its business as described in the Prospectus;
and each such subsidiary of the Company is duly qualified to do
business as a foreign corporation or other business entity in good
standing in each jurisdiction identified in Annex A-2 to such
opinion (such Annex to identify each U.S. jurisdiction where the
applicable subsidiaries are qualified as a foreign corporation, as
listed in Schedule B to this Agreement); all of the issued and
outstanding capital stock or other equity interests of each such
subsidiary of the Company have been duly authorized and validly
issued and are fully paid and non-assessable; and all of the
outstanding capital stock or other equity interests of each such
subsidiary is owned by the Company, directly or through
subsidiaries, and to such
20
counsel's knowledge such capital stock is so owned free from liens,
encumbrances and defects;
(iii) The Offered Securities have been duly authorized and,
when issued and delivered to and paid for by the Underwriters, will
be validly issued, fully paid and non-assessable;
(iv) The authorized and outstanding capital stock of the
Company is as set forth in the Capitalization table contained in the
Prospectus. The outstanding shares of capital stock of the Company
(A) have been duly authorized and validly issued and are fully paid
and non-assessable and (B) are free of preemptive, subscription or
similar rights under the Delaware General Corporation Law (the
"DGCL") or the charter or bylaws or other organizational documents
of the Company or under any contract, commitment or instrument
described in the Prospectus or filed as an exhibit to the
Registration Statement or otherwise known to such counsel; the
Offered Securities, when issued, will be free of preemptive,
subscription or similar rights under the DGCL or the charter or
bylaws or other organizational documents of the Company or any
contract, commitment or instrument described in the Prospectus or
filed as an exhibit to the Registration Statement or otherwise known
to such counsel; and the certificates for the Offered Securities are
in due and proper form and conform to the requirements of the DGCL
and the Nasdaq;
(v) The Offered Securities conform in all material respects to
the description thereof contained in the Prospectus;
(vi) To such counsel's knowledge, except as described in the
Prospectus, no holder of any security of the Company has the right
to require registration of shares of Common Stock or other
securities of the Company in connection with registration of the
Offered Securities or otherwise;
(vii) Neither the Company nor any of its subsidiaries is nor,
after giving effect to the offering and sale of the Offered
Securities and the application of the proceeds thereof as described
in the Prospectus, will be an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in
the Investment Company Act of 1940, as amended;
(viii) No consent, approval, authorization or order of, or
filing with any United States federal, Massachusetts, New York or,
pursuant to the DGCL, Delaware governmental agency body or court, or
approval of the shareholders of the Company, is required for the
consummation of the transactions contemplated by this Agreement in
connection with the issuance or sale of the Offered Securities by
the Company, except such as may be required under state securities
or blue sky laws, as to which such counsel need express no opinion,
and except for such as have been obtained under the Act and Exchange
Act;
(ix) The execution and delivery of this Agreement and the
issuance and sale by the Company of the Offered Securities and the
consummation of the transactions contemplated by this Agreement will
not (i) violate the Certificate of Incorporation or By-Laws of the
Company or its subsidiaries, (ii) breach or result in a default (or
constitute an event which, with notice, lapse of time or both would
constitute a default) under any
21
agreement or instrument listed as an Exhibit to the Registration
Statement or (iii) violate any applicable United States federal, or
Massachusetts, New York or, pursuant to the DGCL, Delaware law or
regulation or any order, writ, injunction or decree specifically
naming the Company or any of its subsidiaries, except that such
counsel need express no opinion as to state securities laws; and
(x) This Agreement has been duly authorized, executed and
delivered by the Company.
The letter containing such opinion shall also state that:
The Initial Registration Statement was declared effective under the
Act as of the date and time specified in such opinion, the
Additional Registration Statement (if any) was filed and became
effective under the Act as of the date and time (if determinable)
specified in such opinion, the Prospectus either was filed with the
Commission pursuant to the subparagraph of Rule 424(b) specified in
such opinion on the date specified therein or was included in the
Initial Registration Statement or the Additional Registration
Statement (as the case may be), and, to the best of the knowledge of
such counsel, no stop order suspending the effectiveness of a
Registration Statement or any part thereof has been issued and no
proceedings for that purpose have been instituted or are pending,
threatened or contemplated under the Act. In the course of the
preparation by the Company of the Registration Statement and the
Prospectus, such counsel has participated in discussions with your
representatives and those of the Company and its independent
accountants, in which the business and affairs of the Company and
the contents of the Registration Statement and the Prospectus were
discussed. On the basis of information that such counsel has gained
in the course of their representation of the Company in connection
with its preparation of the Registration Statement and the
Prospectus and their participation in the discussions referred to
above, such counsel believes that the Registration Statement, as of
its effective date, and the Prospectus, as of its date, complied as
to form in all material respects with the requirements of the Act
and the rules and regulations of the Commission thereunder; such
counsel does not know of any legal or governmental proceeding to
which the Company or any of its subsidiaries is a party or to which
any of their property is subject required to be described in the
Prospectus which is not so described, nor of any contract or other
document of a character required to be described in the Prospectus
or to be filed as an exhibit to the Registration Statement which is
not so described or filed. Further, based on such information and
participation, nothing that has come to such counsel's attention has
caused such counsel to believe that, as of its effective date, the
Registration Statement contained any untrue statement of a material
fact or omitted to state any material fact required to be stated
therein or necessary to make the statements therein not misleading,
or that the Prospectus, as of its date or as of the date of such
counsel's opinion contained or contains any untrue statement of a
material fact or omitted or omits to state any material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading. Such
counsel makes no statement, however, as to the financial statements,
including the notes and schedules thereto, or any other financial or
accounting data (or statistical data derived therefrom) set forth or
referred to in the Registration Statement or the Prospectus. Such
counsel does not assume any responsibility for the accuracy
completeness or fairness of the statements made or the information
contained in the Registration or Prospectus except as for those made
under the captions "Business -
22
Collaboration, Licenses and Strategic Relationships," "Business -
Recent Acquisition of Kourion Therapeutics," "Management -
Employment and Severance Agreements," "Management - Employee Benefit
Plans," "Certain Relationships and Related Party Transactions,"
"Description of Capital Stock," and "Shares Eligible for Future
Sale," which accurately summarize in all material respects the
provisions of the laws, legal matters, agreements and documents
referred to therein.
(g) The Representatives shall have received an opinion, dated such
Closing Date, of Xxxxx & Xxxxxx LLP, patent counsel to the Company, to the
effect that:
(i) to such counsel's knowledge, except as described in the
Prospectus, (A) the Company and its subsidiaries have valid license
rights or clear title to the intellectual property referenced in the
Prospectus, and there are no rights of third parties to any such
intellectual property; (B) there is no infringement or other
violation by third parties of any of the intellectual property of
the Company or any of its subsidiaries referenced in the Prospectus;
(C) there is no infringement or other violation by the Company or
any of its subsidiaries of any intellectual property of others nor
would there be any such infringement upon commercialization of the
products described as under development in the Registration
Statement and the Prospectus; (D) there is no pending or threatened
action, suit, proceeding or claim by governmental authorities or
others that the Company or any of its subsidiaries infringes or
otherwise violates any intellectual property of others, and such
counsel is unaware of any facts which would form a reasonable basis
for any such claim; (E) there is no pending or threatened action,
suit, proceeding or claim by governmental authorities or others
challenging the rights of the Company or any of its subsidiaries in
or to, or challenging the scope of, any intellectual property of the
Company or any of its subsidiaries referenced in the Prospectus, and
such counsel is unaware of any facts which would form a reasonable
basis for any such claim; and (F) except as would not, individually
or in the aggregate, have a Material Adverse Effect, there is no
prior art or other facts that may render any patent held by the
Company or any of its subsidiaries invalid or unenforceable;
(ii) to such counsel's knowledge, the patent applications of
the Company and its subsidiaries presently on file disclose
patentable subject matter, and such counsel is not aware of any
inventorship challenges, any interference which has been declared or
provoked, or any other material fact with respect to the patent
applications of the Company and its subsidiaries presently on file
that (A) would preclude the issuance of patents with respect to such
applications, or (B) would lead such counsel to conclude that such
patents, when issued, would not be valid and enforceable in
accordance with applicable regulations;
(iii) the statements in the Registration Statement and the
Prospectus referencing Intellectual Property matters, insofar as
such statements constitute summaries of legal matters, contracts,
agreements, documents or proceedings referred to therein, or refer
to statements of law or legal conclusions, are in all material
respects accurate and complete statements or summaries of the
matters therein set forth; and
(iv) nothing has come to such counsel's attention that causes
them to believe that such above described portions of the
Registration Statement, at the time such Registration
23
Statement became effective or as of the Closing Date, contained an
untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading, or that such above described
portions of the Prospectus and at the date of the Prospectus or as
of the Closing Date, as the case may be, contained an untrue
statement of material fact or omitted to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(h) The Representatives shall have received an opinion, dated such
Closing Date, of Xxxxxxx Procter LLP, litigation counsel for the Company,
to the effect that the information in the Registration Statement and the
Prospectus under the heading "Legal Proceedings" and those other
statements in the Registration Statement and the Prospectus that are
descriptions of the legal proceedings referred to under such heading, or
refer to statements of law or legal conclusions relating thereto
(collectively, the "LITIGATION INFORMATION"), insofar as such statements
constitute a summary of such proceedings or of documents or matters of
law, at the time such Registration Statement became effective, as of the
date of the Prospectus and at the Closing Date, are accurate and complete
and present fairly the information referred to therein.
(i) The Representatives shall have received an opinion, dated such
Closing Date, of Xxxxx & Xxxxxxx LLP, regulatory counsel for the Company,
to the effect that:
(i) the statements in the Registration Statement and the
Prospectus regarding the U.S. Food and Drug Administration ("FDA")
and the privacy standards promulgated under the Health Insurance
Portability and Accountability Act of 1996 ("HIPAA PRIVACY")
regulatory sections, insofar as such statements purport to summarize
applicable provisions of the Federal Food, Drug and Cosmetic Act, as
amended ("FDC ACT"), sections 351 and 361 of the Public Heath
Service Act ("PHS ACT"), the regulations promulgated thereunder, and
the HIPAA Privacy standards are accurate summaries in all material
respects of the provisions purported to be summarized in the FDA and
HIPAA Privacy regulatory sections; and
(ii) To such counsel's knowledge, based on the business of the
Company as described in the Prospectus, there is no provision of the
FDC Act, sections 351 and 361 of the PHS Act, the regulations
promulgated thereunder, and the HIPAA Privacy standards that would
be material to an investor in the Securities and Optional Securities
that is not summarized in the FDA and HIPAA Privacy regulatory
sections.
(j) The Representatives shall have received an opinion, dated such
Closing Date, of German counsel to the Company to the effect that:
(i) Kourion Therapeutics AG, a company organized under the
laws of Germany, has been duly incorporated and is validly existing
as a corporation under the laws of Germany, with all requisite power
and authority to own, lease and operate its properties and to
conduct its business as currently conducted and as described in the
Prospectus;
(ii) All of the issued and outstanding shares of capital stock
of Kourion have been duly authorized and validly issued, are fully
paid and non-assessable, and to such counsel's knowledge, are owned
by the Company free from liens, encumbrances or defects; and to such
counsel's knowledge, no options, warrants or other rights to
24
purchase, agreements or other obligations to issue or other rights
to convert any obligation into shares of capital stock or ownership
interests in Kourion are outstanding;
(iii) To such counsel's knowledge, there is no litigation or
governmental or other action, suit, proceedings or investigations
before any court or before or by any public, regulatory or
governmental agency or body pending or, to such counsel's knowledge,
threatened in Germany against or involving the properties or
business of Kourion in Germany which, if determined adversely to
Kourion, would, individually or in the aggregate, have a Material
Adverse Effect; and
(iv) The execution, delivery and performance of the
Underwriting Agreement by the Company, the issuance and sale of the
Offered Securities by the Company and the consummation by the
Company of the transactions contemplated hereby do not and will not,
conflict with, result in any breach or violation of or constitute a
default under (nor constitute any event which with notice, lapse of
time or both would result in any breach or violation of or
constitute a default under) (A) the charter documents of Kourion, or
(B) any indenture, mortgage, deed of trust, bank loan or credit
agreement, other evidence of indebtedness, license, lease, contract
or other agreement or instrument to which Kourion is a party or by
which it or any of its properties may be bound filed as an exhibit
to the Registration Statement or which has otherwise been identified
to such counsel by the Company or Kourion in writing as being
material, or (C) any German law, regulation or rule or any decree,
judgment or order applicable to Kourion and known to such counsel.
(k) The Representatives shall have received from Xxxxx Xxxxxxxxxx
LLP, counsel for the Underwriters, such opinion or opinions, dated
such Closing Date, with respect to the incorporation of the Company,
the validity of the Offered Securities delivered on such Closing
Date, the Registration Statements, the Prospectus and other related
matters as the Representatives may require, and the Company shall
have furnished to such counsel such documents as they request for
the purpose of enabling them to pass upon such matters.
(l) The Representatives shall have received a certificate, dated
such Closing Date, of the President or any Vice President and a principal
financial or accounting officer of the Company in which such officers
shall state that: the representations and warranties of the Company in
this Agreement are true and correct; the Company has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied hereunder at or prior to such Closing Date; no stop order
suspending the effectiveness of any Registration Statement has been issued
and no proceedings for that purpose have been instituted or, to their
knowledge, are contemplated by the Commission; the Additional Registration
Statement (if any) satisfying the requirements of subparagraphs (1) and
(3) of Rule 462(b) was filed pursuant to Rule 462(b), including payment of
the applicable filing fee in accordance with Rule 111(a) or (b) under the
Act, prior to the time the Prospectus was printed and distributed to any
Underwriter; and, subsequent to the date of the most recent financial
statements in the Prospectus, there has been no material adverse change,
nor any development or event involving a prospective material adverse
change, in the condition (financial or other), business, properties or
results of operations of the Company and its subsidiaries taken as a whole
except as set forth in the Prospectus.
(m) The Representatives shall have received letters, dated such
Closing Date, of PricewaterhouseCoopers LLP which meet the requirements of
subsection (a) and (b), respectively,
25
of this Section 6, except that the specified date referred to in such
subsection will be a date not more than three days prior to such Closing
Date for the purposes of this subsection.
(n) On or prior to the date of this Agreement, the Representatives
shall have received lockup letters from each of the Company's (i)
executive officers, (ii) directors, (iii) employees who are security
holders of the Company, (iv) security holders listed in the table under
"Principal Stockholders" in the Registration Statement and (v) other
security holders, such that the percentage of security holdings of the
security holders under clause (v), in combination with the security
holdings of the individuals listed in clauses (i) through (iv), will
aggregate at least 95% of the outstanding securities of the Company, on
both an actual and fully diluted basis immediately prior to giving effect
to this offering.
(o) No amendment or supplement to the Registration Statement or
Prospectus shall at any time have been filed to which you have reasonably
objected in writing.
(p) The Company shall have furnished to you such other documents and
certificates as to the accuracy and completeness of any statement in the
Registration Statement and the Prospectus as of the time of purchase and
the additional time of purchase, as the case may be, as you may reasonably
request.
The Company will furnish the Representatives with such conformed copies of such
opinions, certificates, letters and documents as the Representatives reasonably
request. CSFB and UBS may in their sole discretion waive on behalf of the
Underwriters compliance with any conditions to the obligations of the
Underwriters hereunder, whether in respect of an Optional Closing Date or
otherwise.
7. Indemnification and Contribution. (a) The Company will indemnify and
hold harmless each Underwriter, its partners, members, directors and officers
and each person, if any, who controls such Underwriter within the meaning of
Section 15 of the Act, against any losses, claims, damages or liabilities, joint
or several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any Registration Statement,
the Prospectus, or any amendment or supplement thereto, or any related
preliminary prospectus, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein (in light of the circumstances under
which they were made, in the case of any preliminary prospectus or a Prospectus)
not misleading; and will reimburse each Underwriter for any legal or other
expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company will not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement in or omission or alleged omission from any of such documents in
reliance upon and in conformity with written information furnished to the
Company by any Underwriter through the Representatives specifically for use
therein, it being understood and agreed that the only such information furnished
by any Underwriter consists of the information described as such in subsection
(b) below; and provided, further, that with respect to any untrue statement or
alleged untrue statement in or omission or alleged omission from any preliminary
prospectus or any final prospectus (including any amendment or supplement
thereto), the indemnity agreement contained in this subsection (a) shall not
inure to the benefit of any Underwriter from whom the person asserting any such
losses, claims, damages or liabilities purchased the Offered Securities
concerned, to the extent that a prospectus relating to such Offered Securities
was required to be delivered by such Underwriter under the Act in connection
with such purchase and any such loss, claim, damage or liability of such
26
Underwriter results from the fact that there was not sent or given to such
person, at or prior to the written confirmation of the sale of such Offered
Securities to such person, a copy of the Prospectus as then amended and/or
supplemented if the Company had previously furnished copies thereof to such
Underwriter prior to the mailing of the written confirmation of the sale of such
Offered Securities to such person.
The Company agrees to indemnify and hold harmless the Designated
Underwriter[s], their respective partners, members, directors and officers and
each person, if any, who controls the Designated Underwriter within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act
(the "DESIGNATED ENTITIES"), from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or investigating any
such action or claim) (i) caused by 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
Directed Share Program or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading; (ii) caused by the failure of any Participant
to pay for and accept delivery of Directed Shares that the Participant agreed to
purchase; or (iii) related to, arising out of, or in connection with the
Directed Share Program, other than in the case of this clause (iii), 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 Designated Entities.
(b) Each Underwriter will severally and not jointly indemnify and hold
harmless the Company, its directors and officers and each person, if any who
controls the Company within the meaning of Section 15 of the Act, against any
losses, claims, damages or liabilities to which the Company may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus, or arise out of or are based
upon the omission or the alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information furnished to the
Company by such Underwriter through the Representatives specifically for use
therein, and will reimburse any legal or other expenses reasonably incurred by
the Company in connection with investigating or defending any such loss, claim,
damage, liability or action as such expenses are incurred, it being understood
and agreed that the only such information furnished by any Underwriter consists
of (i) the following information in the Prospectus furnished on behalf of each
Underwriter: the concession and reallowance figures appearing in the fifth
paragraph under the caption "Underwriting" and the information contained in the
seventh, sixteenth and seventeenth paragraphs under the caption "Underwriting."
27
(c) Promptly after receipt by an indemnified party under this Section of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the failure to notify the indemnifying party shall not relieve it
from any liability that it may have under subsection (a) or (b) above except to
the extent that it has been materially prejudiced (through the forfeiture of
substantive rights or defenses) by such failure; and provided further that the
failure to notify the indemnifying party shall not relieve it from any liability
that it may have to an indemnified party otherwise than under subsection (a) or
(b) above. In case any such action is brought against any indemnified party and
it notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein and, to the extent that it may
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel reasonably satisfactory to such indemnified
party (who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party), and after notice from the indemnifying party
to such indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
Section, for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation. Notwithstanding anything contained herein to the
contrary, if indemnity may be sought pursuant to the last paragraph in Section 7
(a) hereof in respect of such action or proceeding, then in addition to such
separate firm for the indemnified parties, the indemnifying party shall be
liable for the reasonable fees and expenses of not more than one separate firm
(in addition to any local counsel) for the Designated Underwriter[s] for the
defense of any losses, claims, damages and liabilities arising out of the
Directed Share Program, its partners, members, directors and officers and all
persons, if any, who control the Designated Underwriter within the meaning of
either Section 15 of the Act of Section 20 of the Exchange Act. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement (i) includes
an unconditional release of such indemnified party from all liability on any
claims that are the subject matter of such action and (ii) does not include a
statement as to, or an admission of, fault, culpability or a failure to act by
or on behalf of an indemnified party.
(d) If the indemnification provided for in this Section is unavailable or
insufficient to hold harmless an indemnified party under subsection (a) or (b)
above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the other from the offering of the Securities
or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and the Underwriters on the other in connection with
the statements or omissions which resulted in such losses, claims, damages or
liabilities as well as any other relevant equitable considerations. The relative
benefits received by the Company on the one hand and the Underwriters on the
other shall be deemed to be in the same proportion as the total net proceeds
from the offering (before deducting expenses) received by the Company bear to
the total underwriting discounts and commissions received by the Underwriters.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The amount paid by an indemnified party as a
result of the losses, claims, damages or liabilities referred to in the first
sentence of this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such
28
indemnified party in connection with investigating or defending any action or
claim which is the subject of this subsection (d). Notwithstanding the
provisions of this subsection (d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Securities underwritten by it and distributed to the public were offered to
the public exceeds the amount of any damages which such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection (d) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) The obligations of the Company under this Section 7 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to the partners, members, directors and
officers of and each person, if any, who controls any Underwriter within the
meaning of the Act; and the obligations of the Underwriters under this Section
shall be in addition to any liability which the respective Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to each
director of the Company, to each officer of the Company who has signed a
Registration Statement and to each person, if any, who controls the Company
within the meaning of the Act.
8. Default of Underwriters. If any Underwriter or Underwriters default in
their obligations to purchase Offered Securities hereunder on either the First
Closing Date or any Optional Closing Date and the aggregate number of shares of
Offered Securities that such defaulting Underwriter or Underwriters agreed but
failed to purchase does not exceed 10% of the total number of shares of Offered
Securities that the Underwriters are obligated to purchase on such Closing Date,
CSFB and UBS may make arrangements satisfactory to the Company for the purchase
of such Offered Securities by other persons, including any of the Underwriters,
but if no such arrangements are made by such Closing Date, the non-defaulting
Underwriters shall be obligated severally, in proportion to their respective
commitments hereunder, to purchase the Offered Securities that such defaulting
Underwriters agreed but failed to purchase on such Closing Date. If any
Underwriter or Underwriters so default and the aggregate number of shares of
Offered Securities with respect to which such default or defaults occur exceeds
10% of the total number of shares of Offered Securities that the Underwriters
are obligated to purchase on such Closing Date and arrangements satisfactory to
CSFB, UBS and the Company for the purchase of such Offered Securities by other
persons are not made within 36 hours after such default, this Agreement will
terminate without liability on the part of any non-defaulting Underwriter or the
Company, except as provided in Section 9 hereof (provided that if such default
occurs with respect to Optional Securities after the First Closing Date, this
Agreement will not terminate as to the Firm Securities or any Optional
Securities purchased prior to such termination). As used in this Agreement, the
term "Underwriter" includes any person substituted for an Underwriter under this
Section 8. Nothing herein will relieve a defaulting Underwriter from liability
for its default.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Underwriters set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation, or statement as to the results thereof, made by or on behalf
of any Underwriter, the Company or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the Offered Securities. If this Agreement is terminated pursuant
to Section 8 hereof or if for any reason the purchase of the Offered Securities
by the Underwriters is not consummated, the Company shall remain responsible for
the expenses to be paid or reimbursed by it pursuant to Section 5 hereof and the
respective obligations of the Company and the Underwriters pursuant to Section 7
hereof shall remain in effect, and if any Offered Securities have been purchased
hereunder the representations and warranties in Section 2 hereof and all
obligations under Section 5 hereof shall also
29
remain in effect. If the purchase of the Offered Securities by the Underwriters
is not consummated for any reason other than solely because of the termination
of this Agreement pursuant to Section 8 hereof or the occurrence of any event
specified in clause (iii), (iv), (vi), (vii) or (viii) of Section 6(d) hereof,
the Company will reimburse the Underwriters for all out-of-pocket expenses
(including fees and disbursements of counsel) reasonably incurred by them in
connection with the offering of the Offered Securities.
10. Notices. All communications hereunder will be in writing and, if sent
to the Underwriters, will be mailed, delivered or faxed and confirmed to the
Representatives, c/o Credit Suisse First Boston LLC, Eleven Madison Avenue, New
York, N.Y. 10010-3629, Attention: Transactions Advisory Group (Fax:
000-000-0000) and UBS Securities LLC, 000 Xxxx Xxxxxx, Xxx Xxxx, X.X. 00000,
Attention: Syndicate Department (Fax: 212-[ ]), or, if sent to the Company, will
be mailed, delivered or faxed and confirmed to it at ViaCell, Inc., 000 Xxxxx
Xxxxxx, Xxxxxxxxx, XX 00000, Attention: Chief Financial Officer, with a copy to
Ropes & Xxxx LLP, Xxx Xxxxxxxxxxxxx Xxxxx, Xxxxxx, XX 00000, Attention: Xxxx X.
Xxxxxxxxxx; provided, however, that any notice to an Underwriter pursuant to
Section 7 hereof will be mailed, delivered or faxed and confirmed to such
Underwriter.
11. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers and
directors and controlling persons referred to in Section 7, hereof, and no other
person will have any right or obligation hereunder.
12. Representation of Underwriters. The Representatives will act for the
several Underwriters in connection with this financing, and any action under
this Agreement taken by the Representatives jointly or by CSFB and UBS will be
binding upon all the Underwriters.
13. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS.
The Company (on its behalf and, to the extent permitted by applicable law,
on behalf of its stockholders and affiliates) waives all right to trial by jury
in any action, proceeding or counterclaim (whether based upon contract, tort or
otherwise) in any way arising out of or relating to this Agreement.
The Company hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
30
If the foregoing is in accordance with the Representatives' understanding
of our agreement, kindly sign and return to the Company one of the counterparts
hereof, whereupon it will become a binding agreement between the Company and the
several Underwriters in accordance with its terms.
Very truly yours,
VIACELL INC.
By.............................
[Insert title]
The foregoing Underwriting Agreement is hereby
confirmed and accepted as of the date first above
written.
CREDIT SUISSE FIRST BOSTON LLC
UBS SECURITIES LLC
LAZARD FRERES & CO. LLC
LEERINK XXXXX & COMPANY
Acting on behalf of themselves and the other
several Underwriters
By CREDIT SUISSE FIRST BOSTON LLC
By.......................................................
Name:
Title:
By UBS SECURITIES LLC
By.......................................................
Name:
Title:
By.......................................................
Name:
Title:
31
SCHEDULE A
NUMBER OF
UNDERWRITER FIRM SECURITIES
----------- ---------------
Credit Suisse First Boston LLC..............................................
UBS Securities LLC..........................................................
Lazard Freres & Co. LLC.....................................................
Leerink Xxxxx & Company.....................................................
---------------
Total............................................
===============
SCHEDULE B
VIACELL, INC. AND ITS SUBSIDIARIES
Jurisdiction Jurisdictions in which qualified
Entity of Organization to do business
ViaCell, Inc. Delaware Massachusetts
Kourion Therapeutics AG Germany None
ViaCell Endocrine Science, Inc. Delaware Massachusetts
Viacord, Inc. Delaware Massachusetts, Ohio, Kentucky
ViaCell Neuroscience, Inc. Delaware Massachusetts
ViaCell Securities Corporation Massachusetts None
ViaCell Singapore Pte Ltd. Singapore None
EXHIBIT A
________, 2004
ViaCell, Inc.
000 Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Credit Suisse First Boston LLC
UBS Securities LLC
Lazard Freres & Co. LLC
Leerink Xxxxx & Company
c/o Credit Suisse First Boston LLC
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Dear Sirs:
As an inducement to the Underwriters to execute the Underwriting
Agreement, pursuant to which an offering will be made that is intended to result
in the establishment of a public market for Common Stock (the "SECURITIES") of
ViaCell, Inc., a Delaware corporation, and any successor (by merger or
otherwise) thereto, (the "COMPANY"), the undersigned hereby agrees that from the
date hereof and until 180 days after the public offering date set forth on the
final prospectus used to sell the Securities (the "PUBLIC OFFERING DATE")
pursuant to the Underwriting Agreement, to which you are or expect to become
parties, the undersigned will not offer, sell, contract to sell, pledge or
otherwise dispose of, directly or indirectly, any shares of Securities or
securities convertible into or exchangeable or exercisable for any shares of
Securities, enter into a transaction which would have the same effect, or enter
into any swap, hedge or other arrangement that transfers, in whole or in part,
any of the economic consequences of ownership of the Securities, whether any
such aforementioned transaction is to be settled by delivery of the Securities
or such other securities, in cash or otherwise, or publicly disclose the
intention to make any such offer, sale, pledge or disposition, or to enter into
any such transaction, swap, hedge or other arrangement (a "DISPOSITION"),
without, in each case, the prior written consent of Credit Suisse First Boston
LLC and UBS Securities LLC, except a Disposition (i) by gift, will or intestacy;
(ii) to a member or members of the immediate family (i.e., any relation by
blood, marriage or adoption, not more remote than first cousin) of the
undersigned; (iii) to charitable organizations; or (iv) if the undersigned is an
entity, (a) to corporations, partnerships, limited liability companies or other
entities to the extent that such entities are wholly owned by the undersigned,
or (b) by distribution to partners, members or stockholders of the undersigned;
provided, however, that in the case of any Disposition pursuant to the foregoing
provisions (i) - (iv), it shall be a condition to the Disposition that such
Disposition shall not involve a disposition for value and that the transferee
agrees to be bound in writing by the terms of this Agreement prior to such
transfer. In addition, the undersigned agrees that, without the prior written
consent of Credit Suisse First Boston LLC and UBS Securities LLC, it will not,
during the period commencing
on the date hereof and ending 180 days after the Public Offering Date, make any
demand for or exercise any right with respect to, the registration of any
Securities or any security convertible into or exercisable or exchangeable for
the Securities.
Any Securities received upon exercise of options granted to the
undersigned will also be subject to this Agreement.
In furtherance of the foregoing, the Company and its transfer agent
and registrar are hereby authorized to decline to make any transfer of shares of
Securities if such transfer would constitute a violation or breach of this
Agreement.
This Agreement shall be binding on the undersigned and the
successors, heirs, personal representatives and assigns of the undersigned. This
Agreement shall automatically terminate and be of no further force or effect
upon the earliest to occur, if any, of: (i) either Credit Suisse First Boston
LLC and UBS Securities LLC or the Company advises the other party in writing,
prior to the execution of the Underwriting Agreement, that it has determined not
to proceed with the public offering of the Securities; (ii) termination of the
Underwriting Agreement in accordance with the terms thereof; or (iii) December
31, 2005, in the event that the Public Offering Date shall not have occurred on
or before that date.
Very truly yours,
........................................
[Name of stockholder]
EXHIBIT B
VIACELL, INC.
CHIEF FINANCIAL OFFICER'S CERTIFICATE
I, Xxxxxxx X. Dance, do hereby certify that I am the duly elected,
qualified and acting Senior Vice President, Finance and Chief Financial Officer
of ViaCell, Inc., a Delaware corporation (the "Company"), and, in my capacity as
Senior Vice President, Finance and Chief Financial Officer, do hereby certify
that:
1. I am familiar with the accounting, operations and records systems of
the Company.
2. I am providing this certificate in connection with the initial public
offering by the Company of _________ shares of common stock, $0.01 par value per
share (the "Common Stock"), and up to an additional _________ shares of Common
Stock by the Company pursuant to an over-allotment option (the "Offering") as
described in that certain Registration Statement on Form S-1 (No. 333-114209),
as amended (the "Registration Statement"), and the related Prospectus (the
"Prospectus").
3. I have reviewed (a) the audited consolidated balance sheets of the
Company as of December 31, 1999 and December 31, 2000, the audited consolidated
statements of operations, changes in stockholders' equity and cash flows for the
years ended December 31, 1999 and December 31, 2000, the notes related thereto
(collectively, the "Audited Financial Statements"), and the independent
auditors' report on such financial statements, dated _________, issued by Xxxxxx
Xxxxxxxx LLP.
4. To my knowledge after due inquiry, the Audited Financial Statements (a)
comply as to form in all material respects with the applicable accounting
requirements of the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder and (b) present fairly, in all material
respects, the financial position of the Company as of their respective dates,
and the results of its operations and cash flows for the periods ending on such
dates, in conformity with accounting principles generally accepted in the United
States.
5. To my knowledge after due inquiry, the financial data included in the
Prospectus under the captions "Summary Consolidated Financial Data" and
"Selected Consolidated Financial Data" as of the dates and for the periods
described in paragraph 3 above, complies, in all material respects, with the
provisions of the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder, and fairly presents, in all material
respects, the information shown therein, and has been compiled on a basis
consistent with the consolidated financial statements described in paragraph 3
above.
6. I have supervised the compilation of and reviewed the circled
information contained on the attached Schedule A which is included in the
Prospectus and which otherwise has not been confirmed by PricewaterhouseCoopers,
the Company's independent accountants. I have performed the following procedure
with respect to the circled information identified on Schedule A, which was
applied as indicated with respect to the capital letter explained below, and, to
my knowledge after due inquiry, such information is accurate in all material
respects:
A. Compared the amount to or recalculated form the Company's Audited
Financial Statements and found it to be in agreement.
7. I have supervised and reviewed the reconciliation of the Kourion
financial information presented in the "Unaudited Pro Forma Combined Statements
of Operations for the Year Ended December 31, 2003," attached hereto on Schedule
B, to the Kourion financial statements for the nine months ended
September 30, 2003, which were audited by PricewaterhouseCoopers. The Kourion
financial information presented in the "Unaudited Pro Forma Combined Statements
of Operations for the Year Ended December 31, 2003," are converted from the Euro
into the U.S. dollar and from German GAAP to U.S. GAAP for purposes of the
presentation. To my knowledge after due inquiry, such information is accurate in
all material respects and complies, in all material respects, with the
provisions of the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.
This certificate is being furnished to the underwriters for the Offering
solely to assist them in conducting their investigation of the Company and its
subsidiaries in connection with the Offering. This certificate shall not be
used, quoted or otherwise referred to without the prior written consent of the
Company.
IN WITNESS WHEREOF, I have hereunto set my hand this __ day of _____ 2004.
----------------------------------------
Xxxxxxx X. Dance
Senior Vice President, Finance and
Chief Financial Officer
