EXHIBIT 1.1
MW&E Draft
----------
March 13, 2000
______________ Shares
GENOMICA CORPORATION
Common Stock
UNDERWRITING AGREEMENT
_________ __, 2000
CIBC WORLD MARKETS CORP.
PRUDENTIAL SECURITIES INCORPORATED
▇▇▇▇ ▇▇▇▇▇▇▇▇ INCORPORATED
on behalf of the Several
Underwriters named on
Schedule I attached hereto
c/o CIBC World Markets Corp.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Genomica Corporation, a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions contained herein, to sell to you
and the other underwriters named on Schedule I to this Agreement (the
"Underwriters"), for whom you are acting as Representatives (the
"Representatives"), an aggregate of _____________ shares (the "Firm Shares") of
the Company's Common Stock, $0.001 par value (the "Common Stock"). The
respective amounts of the Firm Shares to be purchased by each of the several
Underwriters are set forth opposite their names on Schedule I attached hereto.
In addition, the Company proposes to grant to the Underwriters an option to
purchase up to an additional ___________ shares (the "Option Shares") of Common
Stock from the Company for the purpose of covering over-allotments in connection
with the sale of the Firm Shares. The Firm Shares and the Option Shares are
together called the "Shares."
As part of the offering contemplated by this Agreement, the
Representatives have agreed to reserve out of the Firm Shares purchased by them
up to ________ shares (the "Directed Shares") for sale to the Company's
directors, officers, employees and other parties associated with the Company
(each, individually a "Participant" and collectively, the "Participants") under
the terms of the friends and family directed sales program (the "Friends and
Family Program"). Shares to be sold pursuant to the Friends and Family Program
shall be sold pursuant to this
Agreement at the public offering price. Any Directed Shares not [orally]
confirmed for purchase by a Participant by [5:00 p.m. New York time] on the date
of this Agreement will be offered to the public by the Representatives as set
forth in the Prospectus (as such term is hereinafter defined).
1. Sale and Purchase of the Shares.
-------------------------------
On the basis of the representations, warranties and agreements
contained in, and subject to the terms and conditions of, this Agreement:
(a) The Company agrees to sell to each of the Underwriters, and each
of the Underwriters agrees, severally and not jointly, to purchase from
the Company, at a price of $_____ per share (the "Initial Price"), the
number of Firm Shares set forth opposite the name of such Underwriter
under the column "Number of Firm Shares to be Purchased from the Company"
on Schedule I to this Agreement, subject to adjustment in accordance with
Section 10 hereof.
(b) The Company grants to the several Underwriters an option to
purchase, severally and not jointly, all or any part of the Option Shares
at the Initial Price. The number of Option Shares to be purchased by
each Underwriter shall be the same percentage (adjusted by the
Representatives to eliminate fractions) of the total number of Option
Shares to be purchased by the Underwriters as such Underwriter is
purchasing of the Firm Shares. Such option may be exercised only to
cover over-allotments in the sales of the Firm Shares by the Underwriters
and may be exercised in whole or in part at any time on or before 12:00
noon, New York City time, on the business day before the Firm Shares
Closing Date (as defined below), and from time to time thereafter within
30 days after the date of this Agreement, in each case upon written,
facsimile or telegraphic notice, or verbal or telephonic notice confirmed
by written, facsimile or telegraphic notice, by the Representatives to
the Company no later than 12:00 noon, New York City time, on the business
day before the Firm Shares Closing Date or at least two business days
before the Option Shares Closing Date (as defined below), as the case may
be, setting forth the number of Option Shares to be purchased and the
time and date (if other than the Firm Shares Closing Date) of such
purchase.
2. Delivery and Payment. Delivery by the Company of the Firm
Shares to the Representatives for the respective accounts of the Underwriters,
and payment of the purchase price by certified or official bank check or checks
payable in New York Clearing House (same day) funds drawn to the order of the
Company for the shares purchased from the Company, against delivery of the
respective certificates therefor to the Representatives, shall take place at the
offices of CIBC World Markets Corp., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, at 10:00 a.m., New York City time, on the third business day
following the date of this Agreement, or at such time on such other date, not
later than 10 business days after the date of this Agreement, as shall be agreed
upon by the Company and the Representatives (such time and date of delivery and
payment are called the "Firm Shares Closing Date").
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In the event the option with respect to the Option Shares is exercised
in whole or in part on one or more occasions, delivery by the Company of the
Option Shares to the Representatives for the respective accounts of the
Underwriters and payment of the purchase price thereof in immediately available
funds by wire transfer or by certified or official bank check or checks payable
in New York Clearing House (same day) funds to the Company shall take place at
the offices of CIBC World Markets Corp. specified above at the time and on the
date (which may be the same date as, but in no event shall be earlier than, the
Firm Shares Closing Date) specified in the notice referred to in Section 1(b)
hereof (such time and date of delivery and payment are called the "Option Shares
Closing Date"). The Firm Shares Closing Date and the Option Shares Closing Date
are called, individually, a "Closing Date" and, together, the "Closing Dates."
Certificates evidencing the Shares shall be registered in such names
and shall be in such denominations as the Representatives shall request at least
two full business days before the Firm Shares Closing Date or, in the case of
Option Shares, on the day of notice of exercise of the option as described in
Section l(b) hereof and shall be made available to the Representatives for
checking and packaging, at such place as is designated by the Representatives,
on the full business day before the Firm Shares Closing Date (or the Option
Shares Closing Date in the case of the Option Shares).
3. Registration Statement and Prospectus; Public Offering. The
Company has prepared and filed in conformity with the requirements of the
Securities Act of 1933, as amended (the "Securities Act"), and the published
rules and regulations thereunder (the "Rules") adopted by the Securities and
Exchange Commission (the "Commission") a Registration Statement (as hereinafter
defined) on Form S-1 (No. 333-_____), including a preliminary prospectus
relating to the Shares, and such amendments thereof as may have been required to
the date of this Agreement. Copies of such Registration Statement (including
all amendments thereof) and of the related Preliminary Prospectus (as
hereinafter defined) have heretofore been delivered by the Company to you. The
term "Preliminary Prospectus" means any preliminary prospectus (as described in
Rule 430 of the Rules) included at any time as a part of the Registration
Statement or filed with the Commission by the Company with the consent of the
Representatives pursuant to Rule 424(a) of the Rules. The term "Registration
Statement" as used in this Agreement means the initial registration statement
(including all exhibits, financial schedules and information deemed to be a part
of the Registration Statement through incorporation by reference or otherwise),
as amended at the time and on the date it becomes effective (the "Effective
Date") including the information (if any) deemed to be part thereof at the time
of effectiveness pursuant to Rule 430A of the Rules. If the Company has filed
an abbreviated registration statement to register additional Shares pursuant to
Rule 462(b) under the Rules (the "462(b) Registration Statement") then any
reference herein to the Registration Statement shall also be deemed to include
such 462(b) Registration Statement. The term "Prospectus" as used in this
Agreement means the prospectus in the form included in the Registration
Statement at the time of effectiveness or, if Rule 430A of the Rules is relied
on, the term Prospectus shall also include the final prospectus filed with the
Commission pursuant to Rule 424(b) of the Rules.
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The Company understands that the Underwriters propose to make a public
offering of the Shares, as set forth in and pursuant to the Prospectus, as soon
after the Effective Date and the date of this Agreement as the Representatives
deem advisable. The Company hereby confirms that the Underwriters and dealers
have been authorized to distribute or cause to be distributed each Preliminary
Prospectus and are authorized to distribute the Prospectus (as from time to time
amended or supplemented if the Company furnishes amendments or supplements
thereto to the Underwriters).
4. Representations and Warranties of the Company. The Company hereby
represents and warrants to each Underwriter as follows:
(a) On the Effective Date, the Registration Statement complied, and
on the date of the Prospectus, the date any post-effective amendment to
the Registration Statement becomes effective, the date any supplement or
amendment to the Prospectus is filed with the Commission and each Closing
Date, the Registration Statement and the Prospectus (and any amendment
thereof or supplement thereto) will comply, in all material respects,
with the applicable provisions of the Securities Act and the Rules and
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
the rules and regulations of the Commission thereunder. The Registration
Statement did not, as of the Effective Date, contain any untrue statement
of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein not
misleading; and on the Effective Date and the other dates referred to
above neither the Registration Statement nor the Prospectus, nor any
amendment thereof or supplement thereto, will contain any untrue
statement of a material fact or will omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein not misleading. When any related preliminary
prospectus was first filed with the Commission (whether filed as part of
the Registration Statement or any amendment thereto or pursuant to Rule
424(a) of the Rules) and when any amendment thereof or supplement thereto
was first filed with the Commission, such preliminary prospectus as
amended or supplemented complied in all material respects with the
applicable provisions of the Securities Act and the Rules and did not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make
the statements therein not misleading. Notwithstanding the foregoing,
none of the representations and warranties in this Section 4(a) shall
apply to statements in, or omissions from, the Registration Statement or
the Prospectus made in reliance upon, and in conformity with, information
herein or otherwise furnished in writing by the Representatives on behalf
of the several Underwriters for use in the Registration Statement or the
Prospectus. With respect to the preceding sentence, the Company
acknowledges that the only information furnished in writing by the
Representatives on behalf of the several Underwriters for use in the
Registration Statement or the Prospectus is the paragraph with respect to
stabilization on the inside front cover page of the Prospectus and the
statements contained under the caption "Underwriting" in the Prospectus.
(b) The Registration Statement is effective under the Securities Act
and no
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stop order preventing or suspending the effectiveness of the Registration
Statement or suspending or preventing the use of the Prospectus has been
issued and no proceedings for that purpose have been instituted or are
threatened under the Securities Act. Any required filing of the
Prospectus and any supplement thereto pursuant to Rule 424(b) of the
Rules has been or will be made in the manner and within the time period
required by such Rule 424(b).
(c) The documents incorporated by reference in the Registration
Statement and the Prospectus, at the time they were filed with the
Commission, complied in all material respects with the requirements of
the Exchange Act and, when read together and with the other information
in the Registration Statement and the Prospectus, do not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading.
(d) The financial statements of the Company (including all notes and
schedules thereto) included or incorporated by reference in the
Registration Statement and Prospectus present fairly the financial
position, the results of operations, the statements of cash flows and the
statements of stockholders' equity and the other information purported
to be shown therein of the Company at the respective dates and for the
respective periods to which they apply; and such financial statements and
related schedules and notes have been prepared in conformity with
generally accepted accounting principles, consistently applied throughout
the periods involved, and all adjustments necessary for a fair
presentation of the results for such periods have been made. The summary
and selected financial data included in the Prospectus present fairly the
information shown therein as at the respective dates and for the
respective periods specified and the summary and selected financial data
have been presented on a basis consistent with the consolidated financial
statements so set forth in the Prospectus and other financial
information.
(e) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, whose reports are filed with the Commission
as a part of the Registration Statement, are and, during the periods
covered by their reports, were independent public accountants as required
by the Securities Act and the Rules.
(f) The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware. The
Company has no subsidiary or subsidiaries and does not control, directly
or indirectly, any corporation, partnership, joint venture, association
or other business organization. The Company is duly qualified to do
business and is in good standing as a foreign corporation in each
jurisdiction in which the nature of the business conducted by it or
location of the assets or properties owned, leased or licensed by it
requires such qualification, except for such jurisdictions where the
failure to so qualify would not have a material adverse effect on the
assets or properties, business, results of operations or financial
condition of the Company (a "Material Adverse Effect"). The Company does
not own, lease or license any asset or
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property or conduct any business outside the United States of America.
The Company has all requisite corporate power and authority, and all
necessary authorizations, approvals, consents, orders, licenses,
certificates and permits of and from all governmental or regulatory
bodies or any other person or entity (collectively, the "Permits"), to
own, lease and license its assets and properties and conduct its
business, all of which are valid and in full force and effect, as
described in the Registration Statement and the Prospectus, except where
the lack of such Permits, individually or in the aggregate, would not
have a Material Adverse Effect. The Company has fulfilled and performed
all of its obligations with respect to such Permits and no event has
occurred that allows, or after notice or lapse of time would allow,
revocation or termination thereof or results in any other impairment of
the rights of the Company thereunder. Except as may be required under the
Securities Act and state and foreign Blue Sky laws, no other Permits are
required to enter into, deliver and perform this Agreement and to issue
and sell the Shares.
(g) The Company owns or possesses adequate and enforceable rights to
use all patent, patent applications, trademarks, trademark applications,
trade names, service marks, copyrights, copyright applications, licenses,
know-how and other similar rights and proprietary knowledge
(collectively, "Intangibles") described in the Prospectus as being owned
by it necessary for the conduct of its business. The Company has not
received any notice of, or is not aware of, any infringement of or
conflict with asserted rights of others with respect to any Intangibles.
No departed employee of the Company has a right of reverter, or any other
interest, with respect to any Intangible.
(h) The Company has good and marketable title in fee simple to all
items of real property and good and marketable title to all personal
property described in the Prospectuses as being owned by it. Any real
property and buildings described in the Prospectuses as being held under
lease by the Company is held by it under valid, existing and enforceable
leases, free and clear of all liens, encumbrances, claims, security
interests and defects, except such as are described in the Registration
Statement and the Prospectus or that would not have a Material Adverse
Effect.
(i) There are no litigation or governmental proceedings to which the
Company is subject or which is pending or, to the knowledge of the
Company, threatened, against the Company , which, individually or in the
aggregate, might have a Material Adverse Effect, affect the consummation
of this Agreement or which is required to be disclosed in the
Registration Statement and the Prospectus that is not so disclosed.
(j) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as
described therein, (a) there has not been any material adverse change
with regard to the assets or properties, business, results of operations
or financial condition of the Company; (b) the Company has not sustained
any loss or interference with its assets, businesses or properties
(whether owned or leased) from fire, explosion, earthquake, flood or
other calamity, whether or
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not covered by insurance, or from any labor dispute or any court or
legislative or other governmental action, order or decree which would
have a Material Adverse Effect; and (c) since the date of the latest
balance sheet included in the Registration Statement and the Prospectus,
except as reflected therein, the Company has not (i) issued any
securities or incurred any liability or obligation, direct or contingent,
for borrowed money, except such liabilities or obligations incurred in
the ordinary course of business, (ii) entered into any transaction not in
the ordinary course of business or (iii) declared or paid any dividend or
made any distribution on any shares of its stock or redeemed, purchased
or otherwise acquired or agreed to redeem, purchase or otherwise acquire
any shares of its stock.
(k) There is no document, contract or other agreement of a character
required to be described in the Registration Statement or Prospectus or
to be filed as an exhibit to the Registration Statement which is not
described or filed as required by the Securities Act or Rules. Each
description of a contract, document or other agreement in the
Registration Statement and the Prospectus accurately reflects in all
respects the terms of the underlying document, contract or agreement.
Each agreement described in the Registration Statement and Prospectus or
listed in the Exhibits to the Registration Statement or incorporated by
reference is in full force and effect and is valid and enforceable by and
against the Company in accordance with its terms. Neither the Company,
nor to the Company's knowledge, any other party is in default in the
observance or performance of any term or obligation to be performed by it
under any such agreement, and no event has occurred which with notice or
lapse of time or both would constitute such a default, in any such case
which default or event, individually or in the aggregate, would have a
Material Adverse Effect. No default exists, and no event has occurred
which with notice or lapse of time or both would constitute a default, in
the due performance and observance of any term, covenant or condition, by
the Company of any other agreement or instrument to which the Company is
a party or by which it or its properties or business may be bound or
affected which default or event, individually or in the aggregate, would
have a Material Adverse Effect.
(l) The Company is not in violation of any term or provision of its
charter or by-laws or of any franchise, license, permit, judgment,
decree, order, statute, rule or regulation, where the consequences of
such violation, individually or in the aggregate, would have a Material
Adverse Effect.
(m) Neither the execution, delivery and performance of this
Agreement by the Company nor the consummation of any of the transactions
contemplated hereby (including, without limitation, the issuance and sale
by the Company of the Shares) will give rise to a right to terminate or
accelerate the due date of any payment due under, or conflict with or
result in the breach of any term or provision of, or constitute a default
(or an event which with notice or lapse of time or both would constitute
a default) under, or require any consent or waiver under, or result in
the execution or imposition of any lien, charge or encumbrance upon any
properties or assets of the Company pursuant to the terms of, any
indenture, mortgage, deed of trust or other
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agreement or instrument to which the Company is a party or by which it or
any of its properties or businesses is bound, or any franchise, license,
permit, judgment, decree, order, statute, rule or regulation applicable
to the Company or violate any provision of the charter or by-laws of the
Company, except for such consents or waivers which have already been
obtained and are in full force and effect.
(n) The Company has authorized and outstanding capital stock as set
forth under the caption "Capitalization" in the Prospectus. The
certificates evidencing the Shares are in due and proper legal form and
have been duly authorized for issuance by the Company. All of the issued
and outstanding shares of Common Stock have been duly and validly issued
and are fully paid and nonassessable. There are no statutory preemptive
or other similar rights to subscribe for or to purchase or acquire any
shares of Common Stock of the Company or any such rights pursuant to its
Certificate of Incorporation or by-laws or any agreement or instrument to
or by which the Company is a party or bound. The Shares, when issued and
sold pursuant to this Agreement, will be duly and validly issued, fully
paid and nonassessable and none of them will be issued in violation of
any preemptive or other similar right. Except as disclosed in the
Registration Statement and the Prospectus, there is no outstanding
option, warrant or other right calling for the issuance of, and there is
no commitment, plan or arrangement to issue, any share of stock of the
Company or any security convertible into, or exercisable or exchangeable
for, such stock. The Common Stock and the Shares conform in all material
respects to all statements in relation thereto contained in the
Registration Statement and the Prospectus.
(o) No holder of any security of the Company has the right to have
any security owned by such holder included in the Registration Statement
or to demand registration of any security owned by such holder during the
period ending 180 days after the date of this Agreement, except for such
rights as have been waived. Each stockholder, director and executive
officer of the Company has delivered to the Representatives such person's
enforceable written lock-up agreement in the form attached to this
Agreement ("Lock-Up Agreement").
(p) All necessary corporate action has been duly and validly taken
by the Company to authorize the execution, delivery and performance of
this Agreement and the issuance and sale of the Shares by the Company.
This Agreement has been duly and validly authorized, executed and
delivered by the Company and constitutes and will constitute the legal,
valid and binding obligation of the Company enforceable against the
Company in accordance with its terms, except as the enforceability
thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors'
rights generally and by general equitable principles.
(q) The Company is not involved in any labor dispute nor, to the
knowledge of the Company, is any such dispute threatened, which dispute
would have a Material Adverse Effect. The Company is not aware of any
existing or imminent labor
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disturbance by the employees of any of its principal suppliers or
contractors which would have a Material Adverse Effect. The Company is
not aware of any threatened or pending litigation between the Company and
any of its executive officers which, if adversely determined, could have
a Material Adverse Effect and has no reason to believe that such officers
will not remain in the employment of the Company.
(r) No transaction has occurred between or among the Company and any
of its officers or directors or five percent stockholders or any
affiliate or affiliates of any such officer or director or five percent
stockholder that is required to be described in and is not described in
the Registration Statement and the Prospectus.
(s) The Company has not taken, nor will it take, directly or
indirectly, any action designed to or which might reasonably be expected
to cause or result in, or which has constituted or which might reasonably
be expected to constitute, the stabilization or manipulation of the price
of the Common Stock to facilitate the sale or resale of any of the
Shares.
(t) The Company has filed all Federal, state, local and foreign tax
returns which are required to be filed through the date hereof, or has
received extensions thereof, and has paid all taxes shown on such returns
and all assessments received by it to the extent that the same are
material and have become due. There are no tax audits or investigations
pending, which if adversely determined would have a Material Adverse
Effect; nor are there any material proposed additional tax assessments
against the Company.
(u) The Shares have been duly authorized for quotation on the
National Association of Securities Dealers Automated Quotation ("Nasdaq")
National Market System, subject to official Notice of Issuance. A
registration statement has been filed on Form 8-A pursuant to Section 12
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
which registration statement complies in all material respects with the
Exchange Act.
(v) The Company has complied with all of the requirements and filed
the required forms as specified in Florida Statutes Section 517.075.
(w) The books, records and accounts of the Company accurately and
fairly reflect, in reasonable detail, the transactions in, and
dispositions of, the assets of, and the results of operations of, the
Company. The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management's general or specific
authorizations, (ii) transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted
accounting principles and to maintain asset accountability, (iii) access
to assets is permitted only in accordance with management's general or
specific authorization and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate
action is taken
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with respect to any differences.
(x) The Company is insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are
customary in the businesses in which it is engaged or propose to engage
after giving effect to the transactions described in the Prospectus; all
policies of insurance and fidelity or surety bonds insuring the Company
or any of its subsidiaries or the Company's or its subsidiaries'
respective businesses, assets, employees, officers and directors are in
full force and effect; the Company and each of its subsidiaries are in
compliance with the terms of such policies and instruments in all
material respects; and the Company has no reason to believe that it will
not be able to renew its existing insurance coverage as and when such
coverage expires or to obtain similar coverage from similar insurers as
may be necessary to continue its business at a cost that would not have
a Material Adverse Effect. The Company has not been denied any insurance
coverage which it has sought or for which it has applied.
(y) Each approval, consent, order, authorization, designation,
declaration or filing of, by or with any regulatory, administrative or
other governmental body necessary in connection with the execution and
delivery by the Company of this Agreement and the consummation of the
transactions herein contemplated required to be obtained or performed by
the Company (except such additional steps as may be required by the
National Association of Securities Dealers, Inc. (the "NASD") or may be
necessary to qualify the Shares for public offering by the Underwriters
under the state securities or Blue Sky laws) has been obtained or made
and is in full force and effect.
(z) There are no affiliations with the NASD among the Company's
officers, directors or, to the knowledge of the Company, any five percent
or greater stockholder of the Company, except as set forth in the
Registration Statement or otherwise disclosed in writing to the
Representatives.
(aa) (i) The Company is in compliance in all material respects with
all rules, laws and regulation relating to the use, treatment, storage
and disposal of toxic substances and protection of health or the
environment ("Environmental Law") which are applicable to its business;
(ii) the Company has not received any notice from any governmental
authority or third party of an asserted claim under Environmental Laws;
(iii) the Company has received all permits, licenses or other approvals
required of it under applicable Environmental Laws to conduct its
business and is in compliance with all terms and conditions of any such
permit, license or approval; (iv) to the Company's knowledge, no facts
currently exist that will require the Company to make future material
capital expenditures to comply with Environmental Laws; and (v) no
property which is or has been owned, leased or occupied by the Company
has been designated as a Superfund site pursuant to the Comprehensive
Environmental Response, Compensation of Liability Act of 1980, as amended
(42 U.S.C. Section 9601, et. seq.)
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or otherwise designated as a contaminated site under applicable state or
local law. The Company has not been named as a "potentially responsible
party" under the CER, CLA 1980.
(bb) The Company has conducted a reasonable due diligence
investigation of the effect of Environmental Laws on the business,
operations and properties of the Company to identify and evaluate
associated costs and liabilities (including, without limitation, any
capital or operating expenditures required for clean-up, closure of
properties or compliance with Environmental Laws, or any permit, license
or approval, any related constraints on operating activities and any
potential liabilities to third parties). On the basis of such
investigation, the Company has reasonably concluded that such associated
costs and liabilities would not, singly or in the aggregate, have a
Material Adverse Effect.
(cc) The Company is not and, after giving effect to the offering and
sale of the Shares and the application of proceeds thereof as described
in the Prospectus, will not be an "investment company" within the meaning
of the Investment Company Act of 1940, as amended (the "Investment
Company Act").
(dd) The Company or any other person associated with or acting on
behalf of the Company including, without limitation, any director,
officer, agent or employee of the Company has not, directly or
indirectly, while acting on behalf of the Company (i) used any corporate
funds for unlawful contributions, gifts, entertainment or other unlawful
expenses relating to political activity; (ii) made any unlawful payment
to foreign or domestic government officials or employees or to foreign or
domestic political parties or campaigns from corporate funds; (iii)
violated any provision of the Foreign Corrupt Practices Act of 1977, as
amended; or (iv) made any other unlawful payment.
(ee) (i) The Company has no reason to believe, and does not believe,
that (A) there are any issues related to the Year 2000 Problem that are
of a character required to be described or referred to in the
Registration Statement or Prospectus which have not been accurately
described in the Registration Statement or Prospectus and (B) the Year
2000 Problem has had or will have a Material Adverse Effect, or result in
any material loss or interference with the business or operations of the
Company and (ii) the Company reasonably believes, after due inquiry, that
the suppliers, vendors, customers or other material third parties used or
served by the Company and such subsidiaries addressed the Year 2000
Problem in a timely manner, except to the extent that a failure to
address the Year 2000 by a supplier, vendor, customer or material third
party would not have a Material Adverse Effect.
(ff) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurance that (1) transactions are
executed in accordance with management's general or specific
authorizations; (2) transactions are recorded as necessary to permit
preparation of financial statements in conformity with
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generally accepted accounting principles and to maintain asset
accountability; (3) access to assets is permitted only in accordance with
management's general or specific authorization; and (4) the recorded
accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(gg) Neither the Company nor any other person associated with or
acting on behalf of the Company including, without limitation, any
director, officer, agent or employee of the Company has offered or caused
the Underwriters to offer any of the Shares to any person pursuant to the
Friends and Family Program with the specific intent to unlawfully
influence (i) a customer or supplier of the Company to alter the
customer's or supplier's level or type of business with the Company or
(ii) a trade journalist or publication to write or publish favorable
information about the Company or its products.
5. Conditions of the Underwriters' Obligations. The obligations of
the Underwriters under this Agreement are several and not joint. The respective
obligations of the Underwriters to purchase the Shares are subject to each of
the following terms and conditions:
(a) Notification that the Registration Statement has become
effective shall have been received by the Representatives and the
Prospectus shall have been timely filed with the Commission in accordance
with Section 6(a) of this Agreement.
(b) No order preventing or suspending the use of any preliminary
prospectus or the Prospectus shall have been or shall be in effect and no
order suspending the effectiveness of the Registration Statement shall be
in effect and no proceedings for such purpose shall be pending before or
threatened by the Commission, and any requests for additional information
on the part of the Commission (to be included in the Registration
Statement or the Prospectus or otherwise) shall have been complied with
to the satisfaction of the Commission and the Representatives.
(c) The representations and warranties of the Company contained in
this Agreement and in the certificates delivered pursuant to Section 5(d)
shall be true and correct when made and on and as of each Closing Date as
if made on such date. The Company shall have performed all covenants and
agreements and satisfied all the conditions contained in this Agreement
required to be performed or satisfied by it at or before such Closing
Date.
-12-
(d) The Representatives shall have received on each Closing Date a
certificate, addressed to the Representatives and dated such Closing
Date, of the chief executive or chief operating officer and the chief
financial officer or chief accounting officer of the Company to the
effect that (i) the signers of such certificate have carefully examined
the Registration Statement, the Prospectus and this Agreement and that
the representations and warranties of the Company in this Agreement are
true and correct on and as of such Closing Date with the same effect as
if made on such Closing Date and the Company has performed all covenants
and agreements and satisfied all conditions contained in this Agreement
required to be performed or satisfied by it at or prior to such Closing
Date, and (ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and to the best of their
knowledge, no proceedings for that purpose have been instituted or are
pending under the Securities Act.
(e) The Representatives shall have received, at the time this
Agreement is executed and on each Closing Date a signed letter from
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP addressed to the Representatives and dated,
respectively, the date of this Agreement and each such Closing Date, in
form and substance reasonably satisfactory to the Representatives,
confirming that they are independent accountants within the meaning of
the Securities Act and the Rules, that the response to Item 10 of the
Registration Statement is correct insofar as it relates to them and
stating in effect that:
(i) in their opinion the audited financial statements and
financial statement schedules included or incorporated by reference
in the Registration Statement and the Prospectus and reported on by
them comply as to form in all material respects with the applicable
accounting requirements of the Securities Act and the Rules;
(ii) on the basis of a reading of the amounts included in the
Registration Statement and the Prospectus under the headings
"Summary Financial Information" and "Selected Financial Data,"
carrying out certain procedures (but not an examination in
accordance with generally accepted auditing standards) which would
not necessarily reveal matters of significance with respect to the
comments set forth in such letter, a reading of the minutes of the
meetings of the stockholders and directors of the Company, and
inquiries of certain officials of the Company who have
responsibility for financial and accounting matters of the Company
as to transactions and events subsequent to the date of the latest
audited financial statements, except as disclosed in the
Registration Statement and the Prospectus, nothing came to their
attention which caused them to believe that:
(A) the amounts in "Summary Financial Information," and
"Selected Financial Data" included in the Registration
Statement and the Prospectus do not agree with the
corresponding amounts in the audited financial statements from
which such amounts were derived; or
-13-
(B) with respect to the Company, there were, at a
specified date not more than three business days prior to the
date of the letter, any increases in the current liabilities
and long-term liabilities of the Company or any decreases in
net income or in working capital or the stockholders' equity in
the Company, as compared with the amounts shown on the
Company's audited balance sheet for the fiscal year ended
December 31, 1999 included in the Registration Statement;
(iii) they have performed certain other procedures as may be
permitted under Generally Acceptable Auditing Standards as a result
of which they determined that certain information of an accounting,
financial or statistical nature (which is limited to accounting,
financial or statistical information derived from the general
accounting records of the Company) set forth in the Registration
Statement and the Prospectus and reasonably specified by the
Representatives agrees with the accounting records of the Company;
and
(iv) based upon the procedures set forth in clauses (ii) and
(iii) above and a reading of the amounts included in the
Registration Statement under the headings "Summary Financial and
Other Data" and "Selected Financial Data" included in the
Registration Statement and Prospectus and a reading of the financial
statements from which certain of such data were derived, nothing has
come to their attention that gives them reason to believe that the
"Summary Financial and Other Data" and "Selected Financial Data"
included in the Registration Statement and Prospectus do not comply
as to the form in all material respects with the applicable
accounting requirements of the Securities Act and the Rules or that
the information set forth therein is not fairly stated in relation
to the financial statements included in the Registration Statement
or Prospectus from which certain of such data were derived are not
in conformity with generally accepted accounting principles applied
on a basis substantially consistent with that of the audited
financial statements included in the Registration Statement and
Prospectus.
References to the Registration Statement and the Prospectus in
this paragraph (e) are to such documents as amended and supplemented
at the date of the letter.
(f) The Representatives shall have received on each Closing Date
from ▇▇▇▇▇▇ Godward LLP, counsel for the Company, an opinion, addressed
to the Representatives and dated such Closing Date, and stating in effect
that:
(i) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the
State of Delaware. To the best of such counsel's knowledge, the
Company has no subsidiary and does not control, directly or
indirectly, any corporation, partnership, joint venture,
-14-
association or other business organization. The Company is duly
qualified and in good standing as a foreign corporation in each
jurisdiction in which the character or location of its assets or
properties (owned, leased or licensed) or the nature of its
businesses makes such qualification necessary, except for such
jurisdictions where the failure to so qualify, individually or in
the aggregate, would not have a Material Adverse Effect.
(ii) The Company has all requisite corporate power and
authority to own, lease and license its assets and properties and
conduct its business as now being conducted and as described in the
Registration Statement and the Prospectus and to enter into, deliver
and perform this Agreement and to issue and sell the Shares, other
than those required under the state and foreign Blue Sky laws.
(iii) The Company has authorized and issued capital stock as
set forth in the Registration Statement and the Prospectus under the
caption "Capitalization"; the certificates evidencing the Shares are
in due and proper legal form and have been duly authorized for
issuance by the Company; all of the outstanding shares of Common
Stock of the Company have been duly and validly authorized and
issued and are fully paid and nonassessable and none of them was
issued in violation of any preemptive or other similar right. The
Shares when issued and sold pursuant to this Agreement will be duly
and validly issued, outstanding, fully paid and nonassessable and
none of them will have been issued in violation of any preemptive or
other similar right. To the best of such counsel's knowledge,
except as disclosed in the Registration Statement and the
Prospectus, there are no preemptive or other rights to subscribe for
or to purchase or any restriction upon the voting or transfer of any
securities of the Company pursuant to the Company's Certificate of
Incorporation or by-laws or other governing documents or any
agreements or other instruments to which the Company is a party or
by which it is bound. To the best of such counsel's knowledge,
except as disclosed in the Registration Statement and the
Prospectus, there is no outstanding option, warrant or other right
calling for the issuance of, and no commitment, plan or arrangement
to issue, any share of stock of the Company or any security
convertible into, exercisable for, or exchangeable for stock of the
Company. The capital stock of the Company conforms in all material
respects to the descriptions thereof contained in the Registration
Statement and the Prospectus.
(iv) Each of the Lock-Up Agreements executed by the Company's
stockholders, directors and officers has been duly and validly
delivered by such persons and constitutes the legal, valid and
binding obligation of each such person enforceable against each such
person in accordance with its terms, except as the enforceability
thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general equitable
principles.
-15-
(v) All necessary corporate action has been duly and validly
taken by the Company to authorize the execution, delivery and
performance of this Agreement and the issuance and sale of the
Shares. This Agreement has been duly and validly authorized,
executed and delivered by the Company and this Agreement constitutes
the legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar
laws affecting the enforcement of creditors' rights generally and by
general equitable principles.
(vi) Neither the execution, delivery and performance of this
Agreement by the Company nor the consummation of any of the
transactions contemplated hereby (including, without limitation, the
issuance and sale by the Company of the Shares) will give rise to a
right to terminate or accelerate the due date of any payment due
under, or conflict with or result in the breach of any term or
provision of, or constitute a default (or any event which with
notice or lapse of time, or both, would constitute a default) under,
or require consent or waiver under, or result in the execution or
imposition of any lien, charge, claim, security interest or
encumbrance upon any properties or assets of the Company pursuant to
the terms of any indenture, mortgage, deed trust, note or other
agreement or instrument of which such counsel is aware and to which
the Company is a party or by which it or any of its properties or
businesses is bound, or any franchise, license, permit, judgment,
decree, order, statute, rule or regulation of which such counsel is
aware or violate any provision of the charter or by-laws of the
Company.
(vii) To the best of such counsel's knowledge, no default
exists, and no event has occurred which with notice or lapse of
time, or both, would constitute a default, in the due performance
and observance of any term, covenant or condition by the Company of
any indenture, mortgage, deed of trust, note or any other agreement
or instrument to which the Company is a party or by which it or any
of its assets or properties or businesses may be bound or affected,
where the consequences of such default, individually or in the
aggregate, would have a Material Adverse Effect.
(viii) To the best of such counsel's knowledge, the Company
is not in violation of any term or provision of its charter or by-
laws or any franchise, license, permit, judgment, decree, order,
statute, rule or regulation, where the consequences of such
violation, individually or in the aggregate, would have a Material
Adverse Effect.
(ix) No consent, approval, authorization or order of any
court or governmental agency or regulatory body is required for the
execution, delivery or performance of this Agreement by the Company
or the consummation of the
-16-
transactions contemplated hereby or thereby, except such as have
been obtained under the Securities Act and such as may be required
under state securities or Blue Sky laws in connection with the
purchase and distribution of the Shares by the several Underwriters.
(x) To the best of such counsel's knowledge, there is no
litigation or governmental or other proceeding or investigation,
before any court or before or by any public body or board pending or
threatened against, or involving the assets, properties or
businesses of, the Company which would have a Material Adverse
Effect.
(xi) The statements in the Prospectus under the captions
"Description of Capital Stock," "Liquidity and Capital Resources,"
"[_____________________]," "Shares Eligible for Future Sale,"
"Management-Employment Agreements," "Management-Employee Benefit
Plans," and "Certain Transactions," insofar as such statements
constitute a summary of documents referred to therein or matters of
law, are fair summaries in all material respects and accurately
present the information called for with respect to such documents
and matters. Accurate copies of all contracts and other documents
required to be filed as exhibits to, or described in, the
Registration Statement have been so filed with the Commission or are
fairly described in the Registration Statement, as the case may be.
(xii) The Registration Statement, all preliminary prospectuses
and the Prospectus and each amendment or supplement thereto (except
for the financial statements and schedules and other financial and
statistical data included therein, as to which such counsel
expresses no opinion) comply as to form in all material respects
with the requirements of the Securities Act and the Rules.
(xiii) The Registration Statement is effective under the
Securities Act, and no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings for
that purpose have been instituted or are threatened, pending or
contemplated. Any required filing of the Prospectus and any
supplement thereto pursuant to Rule 424(b) under the Securities Act
has been made in the manner and within the time period required by
such Rule 424(b).
(xiv) The Shares have been approved for listing on the
Nasdaq National Market.
(xv) The capital stock of the Company conforms in all
material respects to the description thereof contained in the
Prospectus under the caption "Description of Capital Stock."
(xvi) The Company is not an "investment company" or an entity
-17-
controlled by an "investment company" as such terms are defined in
the Investment Company Act of 1940, as amended.
To the extent deemed advisable by such counsel, they may rely as to
matters of fact on certificates of responsible officers of the Company and
public officials and on the opinions of other counsel satisfactory to the
Representatives as to matters which are governed by laws other than the laws of
the State of New York, the General Corporation Law of the State of Delaware and
the Federal laws of the United States; provided that such counsel shall state
that in their opinion the Underwriters and they are justified in relying on such
other opinions. Copies of such certificates and other opinions shall be
furnished to the Representatives and counsel for the Underwriters.
In addition, such counsel shall state that such counsel has
participated in conferences with officers and other representatives of the
Company, representatives of the Representatives and representatives of the
independent certified public accountants of the Company, at which conferences
the contents of the Registration Statement and the Prospectus and related
matters were discussed and, although such counsel is not passing upon and does
not assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement and the Prospectus (except as
specified in the foregoing opinion), on the basis of the foregoing, no facts
have come to the attention of such counsel which lead such counsel to believe
that the Registration Statement at the time it became effective (except with
respect to the financial statements and notes and schedules thereto and other
financial data, as to which such counsel need express no belief) contained any
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not misleading,
or that the Prospectus as amended or supplemented (except with respect to the
financial statements, notes and schedules thereto and other financial data, as
to which such counsel need make no statement) on the date thereof contained any
untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(g) The Representatives shall have received on each Closing Date
from _______________, special regulatory counsel to the Company, an
opinion, addressed to the Representatives and dated such Closing Date, in
form and substance satisfactory to the Representatives.
(h) The Representatives shall have received on each Closing Date
from ___________________, special patent counsel to the Company, an
opinion, addressed to the Representatives and dated such Closing Date, in
substantially the form attached hereto as Exhibit 5(h).
(i) All proceedings taken in connection with the sale of the Firm
Shares and the Option Shares as herein contemplated shall be reasonably
satisfactory in form and substance to the Representatives, and their
counsel and the Underwriters shall have received from ▇▇▇▇▇▇▇▇▇, Will &
▇▇▇▇▇ a favorable opinion, addressed to the
-18-
Representatives and dated such Closing Date, with respect to the Shares,
the Registration Statement and the Prospectus, and such other related
matters, as the Representatives may reasonably request, and the Company
shall have furnished to ▇▇▇▇▇▇▇▇▇, Will & ▇▇▇▇▇ such documents as they
may reasonably request for the purpose of enabling them to pass upon such
matters.
(j) If the Shares have been qualified for sale in Florida, the
Representatives shall have received on each Closing Date certificates,
addressed to the Representatives, and dated such Closing Date, of an
executive officer of the Company, to the effect that the signer of such
certificate has reviewed and understands the provisions of Section
517.075 of the Florida Statutes, and represents that the Company has
complied, and at all times will comply, with all provisions of Section
517.075 and further, that as of such Closing Date, neither the Company
nor any of its affiliates does business with the government of Cuba or
with any person or affiliate located in Cuba.
(k) The Representatives shall have received copies of the Lock-up
Agreements executed by each entity or person described in Section 4(o).
(l) The Company shall have furnished or caused to be furnished to
the Representatives such further certificates or documents as the
Representatives shall have reasonably requested.
6. Covenants of the Company.
------------------------
(a) The Company covenants and agrees as follows:
(i) The Company will use its best efforts to cause the
Registration Statement, if not effective at the time of execution of
this Agreement, and any amendments thereto, to become effective as
promptly as possible. The Company shall prepare the Prospectus in a
form approved by the Representatives and file such Prospectus
pursuant to Rule 424(b) under the Securities Act not later than the
Commission's close of business on the second business day following
the execution and delivery of this Agreement, or, if applicable,
such earlier time as may be required by Rule 430A(a)(3) under the
Securities Act.
(ii) The Company shall promptly advise the Representatives in
writing (i) when any amendment to the Registration Statement shall
have become effective, (ii) of any request by the Commission for any
amendment of the Registration Statement or the Prospectus or for any
additional information, (iii) of the prevention or suspension of the
use of any preliminary prospectus or the Prospectus or of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose and (iv) of the
receipt by the Company of any notification with respect to the
suspension of the qualification of the Shares
-19-
for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose. The Company shall not file any
amendment of the Registration Statement or supplement to the
Prospectus unless the Company has furnished the Representatives a
copy for its review prior to filing and shall not file any such
proposed amendment or supplement to which the Representatives
reasonably object. The Company shall use its best efforts to prevent
the issuance of any such stop order and, if issued, to obtain as
soon as possible the withdrawal thereof.
(iii) If, at any time when a prospectus relating to the Shares
is required to be delivered under the Securities Act and the Rules,
any event occurs as a result of which the Prospectus as then amended
or supplemented would include any untrue statement of a material
fact or omit to state any material fact necessary to make the
statements therein in the light of the circumstances under which
they were made not misleading, or if it shall be necessary to amend
or supplement the Prospectus to comply with the Securities Act or
the Rules, the Company promptly shall prepare and file with the
Commission, subject to the second sentence of paragraph (ii) of this
Section 6(a), an amendment or supplement which shall correct such
statement or omission or an amendment which shall effect such
compliance.
(iv) The Company shall make generally available to its
security holders and to the Representatives as soon as practicable,
but not later than 45 days after the end of the 12-month period
beginning at the end of the fiscal quarter of the Company during
which the Effective Date occurs (or 90 days if such 12-month period
coincides with the Company's fiscal year), an earning statement
(which need not be audited) of the Company, covering such 12-month
period, which shall satisfy the provisions of Section 11(a) of the
Securities Act or Rule 158 of the Rules.
(v) The Company shall furnish to the Representatives and
counsel for the Underwriters, without charge, signed copies of the
Registration Statement (including all exhibits thereto and
amendments thereof) and to each other Underwriter a copy of the
Registration Statement (without exhibits thereto) and all amendments
thereof and, so long as delivery of a prospectus by an Underwriter
or dealer may be required by the Securities Act or the Rules, as
many copies of any preliminary prospectus and the Prospectus and any
amendments thereof and supplements thereto as the Representatives
may reasonably request.
(vi) The Company shall cooperate with the Representatives and
their counsel in endeavoring to qualify the Shares for offer and
sale in connection with the offering under the laws of such
jurisdictions as the Representatives may designate and shall
maintain such qualifications in effect so long as required for the
distribution of the Shares; provided, however, that the Company
shall not
-20-
be required in connection therewith, as a condition thereof, to
qualify as a foreign corporation or to execute a general consent to
service of process in any jurisdiction or subject itself to taxation
as doing business in any jurisdiction.
(vii) Without the prior written consent of CIBC World Markets
Corp., for a period of 180 days after the date of this Agreement,
the Company and each of its individual directors and executive
officers and stockholders shall not issue, sell or register with the
Commission (other than on Form S-8 or on any successor form), or
otherwise dispose of, directly or indirectly, any equity securities
of the Company (or any securities convertible into, exercisable for
or exchangeable for equity securities of the Company), except for
the issuance of the Shares pursuant to the Registration Statement
and the issuance of shares pursuant to the Company's existing stock
option plan or bonus plan as described in the Registration Statement
and the Prospectus. In the event that during this period, (i) any
shares are issued pursuant to the Company's existing stock option
plan or bonus plan that are exercisable during such 180 day period
or (ii) any registration is effected on Form S-8 or on any successor
form relating to shares that are exercisable during such 180 period,
the Company shall obtain the written agreement of such grantee or
purchaser or holder of such registered securities that, for a period
of 180 days after the date of this Agreement, such person will not,
without the prior written consent of CIBC World Markets Corp., offer
for sale, sell, distribute, grant any option for the sale of, or
otherwise dispose of, directly or indirectly, or exercise any
registration rights with respect to, any shares of Common Stock (or
any securities convertible into, exercisable for, or exchangeable
for any shares of Common Stock) owned by such person.
(viii) On or before completion of the offering of the Shares,
the Company shall make all filings required under applicable
securities laws and by the Nasdaq National Market (including any
required registration under the Exchange Act).
(ix) The Company shall file timely and accurate reports in
accordance with the provisions of Florida Statutes Section 517.075,
or any successor provision, and any regulation promulgated
thereunder, if at any time after the Effective Date, the Company or
any of its affiliates commences engaging in business with the
government of Cuba or any person or affiliate located in Cuba.
(x) The Company will apply the net proceeds from the
offering of the Shares in the manner set forth under "Use of
Proceeds" in the Prospectus.
(xi) The Company will comply with all applicable securities
laws and other applicable laws, rules and regulations in each
foreign jurisdiction in which the Directed Shares are offered in
connection with the Friends and Family Program.
-21-
(xii) The Company will ensure that the Directed Shares will be
restricted, to the extent required by the NASD or the NASD rules,
from sale, transfer, assignment, pledge or hypothecation for a
period of three months following the date of the effectiveness of
the Registration Statement. The Representatives will notify the
Company as to which Participants will need to be so restricted. The
Company shall direct the transfer agent to place stop transfer
restrictions upon such securities for such period of time.
(b) The Company agrees to pay, or reimburse if paid by the
Representatives, whether or not the transactions contemplated hereby are
consummated or this Agreement is terminated, all costs and expenses
incident to the public offering of the Shares and the performance of the
obligations of the Company under this Agreement including those relating
to: (i) the preparation, printing, filing and distribution of the
Registration Statement including all exhibits thereto, each preliminary
prospectus, the Prospectus, all amendments and supplements to the
Registration Statement and the Prospectus, and the printing, filing and
distribution of this Agreement; (ii) the preparation and delivery of
certificates for the Shares to the Underwriters; (iii) the registration or
qualification of the Shares for offer and sale under the securities or Blue
Sky laws of the various jurisdictions referred to in Section 6(a)(vi),
including the reasonable fees and disbursements of counsel for the
Underwriters in connection with such registration and qualification and the
preparation, printing, distribution and shipment of preliminary and
supplementary Blue Sky memoranda, if any; (iv) the furnishing (including
costs of shipping and mailing) to the Representatives and to the
Underwriters of copies of each preliminary prospectus, the Prospectus and
all amendments or supplements to the Prospectus, and of the several
documents required by this Section to be so furnished, as may be reasonably
requested for use in connection with the offering and sale of the Shares by
the Underwriters or by dealers to whom Shares may be sold; (v) the filing
fees of the NASD in connection with its review of the terms of the public
offering and reasonable fees and disbursements of counsel for the
Underwriters in connection with such review; (vi) inclusion of the Shares
for quotation on the Nasdaq National Market; and (vii) all transfer taxes,
if any, with respect to the sale and delivery of the Shares by the Company
to the Underwriters (viii) payments to counsel for costs incurred by the
Underwriters in connection with the Friends and Family Program and payment
of any stamp duties, similar taxes or duties or other taxes, if any,
incurred by the Underwriters in connection with the Friends and Family
Program. Subject to the provisions of Section 9 hereof, the Underwriters
agree to pay, whether or not the transactions contemplated hereby are
consummated or this Agreement is terminated, all costs and expenses
incident to the performance of the obligations of the Underwriters under
this Agreement not payable by the Company pursuant to the preceding
sentence, including, without limitation, the fees and disbursements of
counsel for the Underwriters.
(c) If at any time during the 25-day period after the Registration
Statement becomes effective or the period prior to the Option Shares
Closing Date, any rumor,
-22-
publication or event relating to or affecting the Company shall occur as
a result of which in the Representatives' opinion the market price of the
Common Stock has been or is likely to be materially affected (regardless
of whether such rumor, publication or event necessitates a supplement to
or amendment of the Prospectus and any integrated prospectus), the
Company will, after notice from the Representatives advising the Company
to the effect set forth above, forthwith prepare, consult with the
Representatives concerning the substance of, and disseminate a press
release or other public statement, reasonably satisfactory to the
Representatives, responding to or commenting on such rumor, publication
or event.
7. Indemnification.
---------------
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within
the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act against any and all losses, claims, damages and liabilities,
joint or several (including any reasonable investigation, legal and other
expenses incurred in connection with, and any amount paid in settlement
of, any action, suit or proceeding or any claim asserted), to which they,
or any of them, may become subject under the Securities Act, the Exchange
Act or other Federal or state law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities arise
out of or are based upon (i) any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus, the
Registration Statement or the Prospectus or any amendment thereof or
supplement thereto, or in any Blue Sky application or other information
or other documents executed by the Company filed in any state or other
jurisdiction to qualify any or all of the Shares under the securities
laws thereof (any such application, document or information being
hereinafter referred to as a "Blue Sky Application") or arise out of or
are based upon any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) in whole or in part upon any
breach of the representations and warranties set forth in Section 4
hereof, (iii) in whole or in part upon any failure of the Company to
perform any of its obligations hereunder or under law or (iv) any untrue
statement or alleged untrue statement of any material fact contained in
any audio or visual materials prepared by the Company or based upon
written information furnished by or on behalf of the Company, including
(without limitation) slides, videos, films, tape recordings used in
connection with the marketing of the Shares, including (without
limitation) statements communicated to securities analysts employed by
the Underwriters; provided, however, that such indemnity shall not inure
to the benefit of any Underwriter (or any person controlling such
Underwriter) on account of any losses, claims, damages or liabilities
arising from the sale of the Shares to any person by such Underwriter if
such untrue statement or omission or alleged untrue statement or omission
was made in such preliminary prospectus, the Registration Statement or
the Prospectus, or such amendment or supplement thereto, or in any Blue
Sky Application in reliance upon and in conformity with information
furnished in writing to the Company by the Representatives on behalf of
any Underwriter specifically for
-23-
use therein. This indemnity agreement will be in addition to any
liability which the Company may otherwise have.
The Company agrees to indemnify and hold harmless the Representatives
and each person, if any, who controls any Representative within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act against any and all losses, claims, damages, expenses and liabilities
(including any reasonable investigation, legal and other expenses
incurred in connection with, and any amount paid in settlement of, any
action, suit or proceeding or any claim asserted) (i) arising out of or
based upon any untrue statement or alleged untrue statement of a material
fact contained in any material prepared by or with the consent of the
Company for distribution to Participants in connection with the Friends
and Family Program or arising out of or based upon any omission or
alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, (ii)
arising out of or based upon the failure of any Participant to pay for
and accept delivery of Directed Shares otherwise reserved for such
Participant pursuant to the Friends and Family Program, and (iii) related
to, arising out of, or in connection with the Friends and Family Program,
other than losses, claims, damages or liabilities (or expenses relating
thereto) that are finally judicially determined to have resulted from the
bad faith or gross negligence of the Representatives.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company and each person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act, each director of the Company, and each officer of
the Company who signs the Registration Statement, to the same extent as
the foregoing indemnity from the Company to each Underwriter, but only
insofar as such losses, claims, damages or liabilities arise out of or
are based upon any untrue statement or omission or alleged untrue
statement or omission which was made in any preliminary prospectus, the
Registration Statement or the Prospectus, or any amendment thereof or
supplement thereto, contained in the (i) concession and reallowance
figures appearing under the caption "Underwriting" and (ii) the
stabilization information contained under the caption "Underwriting" in
the Prospectus; provided, however, that the obligation of each
Underwriter to indemnify the Company (including any controlling person,
director or officer thereof) shall be limited to the net proceeds
received by the Company from such Underwriter.
(c) Any party that proposes to assert the right to be indemnified
under this Section will, promptly after receipt of notice of commencement
of any action, suit or proceeding against such party in respect of which
a claim is to be made against an indemnifying party or parties under this
Section, notify each such indemnifying party of the commencement of such
action, suit or proceeding, enclosing a copy of all papers served. No
indemnification provided for in Section 7(a) or 7(b) shall be available
to any party who shall fail to give notice as provided in this Section
7(c) if the party to whom notice was not given was unaware of the
proceeding to which such notice would have related and was prejudiced by
the failure to give such notice but the omission so
-24-
to notify such indemnifying party of any such action, suit or proceeding
shall not relieve it from any liability that it may have to any
indemnified party for contribution or otherwise than under this Section.
In case any such action, suit or proceeding shall be brought against any
indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate in, and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party,
and after notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof and the approval by the
indemnified party of such counsel, the indemnifying party shall not be
liable to such indemnified party for any legal or other expenses, except
as provided below and except for the reasonable costs of investigation
subsequently incurred by such indemnified party in connection with the
defense thereof. The indemnified party shall have the right to employ its
counsel in any such action, but the fees and expenses of such counsel
shall be at the expense of such indemnified party unless (i) the
employment of counsel by such indemnified party has been authorized in
writing by the indemnifying parties, (ii) the indemnified party shall
have been advised by counsel that there may be one or more legal defenses
available to it which are different from or in addition to those
available to the indemnifying party (in which case the indemnifying
parties shall not have the right to direct the defense of such action on
behalf of the indemnified party) or (iii) the indemnifying parties shall
not have employed counsel to assume the defense of such action within a
reasonable time after notice of the commencement thereof, in each of
which cases the fees and expenses of counsel shall be at the expense of
the indemnifying parties. An indemnifying party shall not be liable for
any settlement of any action, suit, proceeding or claim effected without
its written consent, which consent shall not be unreasonably withheld or
delayed.
8. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for
in Section 7(a) or 7(b) is due in accordance with its terms but for any
reason is held to be unavailable to or insufficient to hold harmless an
indemnified party under Section 7(a) or 7(b), then each indemnifying
party shall contribute to the aggregate losses, claims, damages and
liabilities (including any investigation, legal and other expenses
reasonably incurred in connection with, and any amount paid in settlement
of, any action, suit or proceeding or any claims asserted, but after
deducting any contribution received by any person entitled hereunder to
contribution from any person who may be liable for contribution) to which
the indemnified party may be subject in such proportion as is appropriate
to reflect the relative benefits received by the Company and the
Underwriters from the offering of the Shares or, if such allocation is
not permitted by applicable law or indemnification is not available as a
result of the indemnifying party not having received notice as provided
in Section 7 hereof, in such proportion as is appropriate to reflect not
only the relative benefits referred to above but also the relative fault
of the Company and the Underwriters in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The
relative benefits received by the Company and the
-25-
Underwriters shall be deemed to be in the same proportion as (x) the
total proceeds from the offering (net of underwriting discounts but
before deducting expenses) received by the Company, as set forth in the
table on the cover page of the Prospectus, bear to (y) the underwriting
discounts received by the Underwriters, as set forth in the table on the
cover page of the Prospectus. The relative fault of the Company or the
Underwriters shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact related
to information supplied by the Company or the Underwriters and the
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company
and the Underwriters agree that it would not be just and equitable if
contribution pursuant to this Section 8 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above. Notwithstanding the
provisions of this Section 8, (i) in no case shall any Underwriter
(except as may be provided in the Agreement Among Underwriters) be liable
or responsible for any amount in excess of the underwriting discount
applicable to the Shares purchased by such Underwriter hereunder and (ii)
the Company shall be liable and responsible for any amount in excess of
such underwriting discount; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. For purposes of this
Section 8, each person, if any, who controls an Underwriter within the
meaning of Section 15 of the Securities Act or Section 20(a) of the
Exchange Act shall have the same rights to contribution as such
Underwriter, and each person, if any, who controls the Company within the
meaning of the Section 15 of the Securities Act or Section 20(a) of the
Exchange Act, each officer of the Company who shall have signed the
Registration Statement and each director of the Company shall have the
same rights to contribution as the Company, subject in each case to
clauses (i) and (ii) in the immediately preceding sentence of this
Section 8. Any party entitled to contribution will, promptly after
receipt of notice of commencement of any action, suit or proceeding
against such party in respect of which a claim for contribution may be
made against another party or parties under this Section 8, notify such
party or parties from whom contribution may be sought, but the omission
so to notify such party or parties from whom contribution may be sought
shall not relieve the party or parties from whom contribution may be
sought from any other obligation it or they may have hereunder or
otherwise than under this Section. No party shall be liable for
contribution with respect to any action, suit, proceeding or claim
settled without its written consent. The Underwriter's obligations to
contribute pursuant to this Section 8 are several in proportion to their
respective underwriting commitments and not joint.
9. Termination. This Agreement may be terminated with respect to the
Shares to be purchased on a Closing Date by the Representatives by notifying the
Company at any time:
-26-
(a) in the absolute discretion of the Representatives at or before
any Closing Date: (i) if on or prior to such date, any domestic or
international event or act or occurrence has materially disrupted, or in
the opinion of the Representatives will in the future materially disrupt,
the securities markets; (ii) if there has occurred any new outbreak or
material escalation of hostilities or other calamity or crisis the effect
of which on the financial markets of the United States is such as to make
it, in the judgment of the Representatives, inadvisable to proceed with
the offering; (iii) if there shall be such a material adverse change in
general financial, political or economic conditions or the effect of
international conditions on the financial markets in the United States is
such as to make it, in the judgment of the Representatives, inadvisable
or impracticable to market the Shares; (iv) if trading in the Shares has
been suspended by the Commission or trading generally on the New York
Stock Exchange, Inc., on the American Stock Exchange, Inc. or the Nasdaq
National Market has been suspended or limited, or minimum or maximum
ranges for prices for securities shall have been fixed, or maximum ranges
for prices for securities have been required, by said exchanges or by
order of the Commission, the National Association of Securities Dealers,
Inc., or any other governmental or regulatory authority; or (v) if a
banking moratorium has been declared by any state or Federal authority;
or (vi) if, in the judgment of the Representatives, there has occurred a
Material Adverse Effect, or
(b) at or before any Closing Date, that any of the conditions
specified in Section 5 hereof shall not have been fulfilled when and as
required by this Agreement.
If this Agreement is terminated pursuant to any of its provisions,
the Company shall be under no liability to any Underwriter, and no Underwriter
shall be under any liability to the Company, except that (y) if this Agreement
is terminated by the Representatives or the Underwriters because of any failure,
refusal or inability on the part of the Company to comply with the terms or to
fulfill any of the conditions of this Agreement, the Company will reimburse the
Underwriters for all out-of-pocket expenses (including the reasonable fees and
disbursements of their counsel) incurred by them in connection with the proposed
purchase and sale of the Shares or in contemplation of performing their
obligations hereunder and (z) no Underwriter who shall have failed or refused to
purchase the Shares agreed to be purchased by it under this Agreement, without
some reason sufficient hereunder to justify cancellation or termination of its
obligations under this Agreement, shall be relieved of liability to the Company
or to the other Underwriters for damages occasioned by its failure or refusal.
10. Substitution of Underwriters. If one or more of the
Underwriters shall fail (other than for a reason sufficient to justify the
cancellation or termination of this Agreement under Section 9) to purchase on
any Closing Date the Shares agreed to be purchased on such Closing Date by such
Underwriter or Underwriters, the Representatives may find one or more substitute
underwriters to purchase such Shares or make such other arrangements as the
Representatives may deem advisable or one or more of the remaining Underwriters
may agree to purchase such Shares in such proportions as may be approved by the
Representatives, in each case upon the terms set forth in this Agreement. If no
such arrangements have been made by the close of business on the business day
following such Closing Date,
-27-
(a) if the number of Shares to be purchased by the defaulting
Underwriters on such Closing Date shall not exceed 10% of the Shares that
all the Underwriters are obligated to purchase on such Closing Date, then
each of the nondefaulting Underwriters shall be obligated to purchase
such Shares on the terms herein set forth in proportion to their
respective obligations hereunder; provided, that in no event shall the
maximum number of Shares that any Underwriter has agreed to purchase
pursuant to Section 1 hereof be increased pursuant to this Section 10 by
more than one-ninth of such number of Shares without the written consent
of such Underwriter, or
(b) if the number of Shares to be purchased by the defaulting
Underwriters on such Closing Date shall exceed 10% of the Shares that all
the Underwriters are obligated to purchase on such Closing Date, then the
Company shall be entitled to one additional business day within which it
may, but is not obligated to, find one or more substitute underwriters
reasonably satisfactory to the Representatives to purchase such Shares
upon the terms set forth in this Agreement.
In any such case, either the Representatives or the Company shall
have the right to postpone the applicable Closing Date for a period of not more
than five business days in order that necessary changes and arrangements
(including any necessary amendments or supplements to the Registration Statement
or Prospectus) may be effected by the Representatives and the Company. If the
number of Shares to be purchased on such Closing Date by such defaulting
Underwriter or Underwriters shall exceed 10% of the Shares that all the
Underwriters are obligated to purchase on such Closing Date, and none of the
nondefaulting Underwriters or the Company shall make arrangements pursuant to
this Section within the period stated for the purchase of the Shares that the
defaulting Underwriters agreed to purchase, this Agreement shall terminate with
respect to the Shares to be purchased on such Closing Date without liability on
the part of any nondefaulting Underwriter to the Company and without liability
on the part of the Company, except in both cases as provided in Sections 6(b),
7, 8 and 9. The provisions of this Section 10 shall not in any way affect the
liability of any defaulting Underwriter to the Company or the nondefaulting
Underwriters arising out of such default. A substitute underwriter hereunder
shall become an Underwriter for all purposes of this Agreement.
11. Miscellaneous. The respective agreements, representations,
warranties, indemnities and other statements of the Company, or its officers,
and of the Underwriters set forth in or made pursuant to this Agreement shall
remain in full force and effect, regardless of any investigation made by or on
behalf of any Underwriter or the Company or any of the officers, directors or
controlling persons referred to in Sections 7 and 8 hereof, and shall survive
delivery of and payment for the Shares. The provisions of Sections 6(b), 7, 8
and 9 hereof shall survive the termination or cancellation of this Agreement.
This Agreement has been and is made for the benefit of the
Underwriters, the Company and their respective successors and assigns, and, to
the extent expressed herein, for the benefit of persons controlling any of the
Underwriters, or the Company, and directors and officers of the Company, and
their respective successors and assigns, and no other person shall acquire
-28-
or have any right under or by virtue of this Agreement. The term "successors and
assigns" shall not include any purchaser of Shares from any Underwriter merely
because of such purchase.
All notices and communications hereunder shall be in writing and
mailed or delivered or by telephone or telegraph if subsequently confirmed in
writing, (a) if to the Representatives, c/o CIBC World Markets Corp., ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, with a
copy to ▇▇▇▇▇▇▇▇▇, Will & ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq. and (b) if to the
Company, to its agent for service as such agent's address appears on the cover
page of the Registration Statement with a copy ▇▇▇▇▇▇ Godward LLP, ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: ▇▇▇▇▇ C.T.
Linfield, Esq.
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York without regard to principles of conflict of
laws.
This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.
-29-
Please confirm that the foregoing correctly sets forth the agreement
among us.
Very truly yours,
GENOMICA CORPORATION
By: ____________________________________
Title:
Confirmed:
CIBC WORLD MARKETS CORP.
PRUDENTIAL SECURITIES INCORPORATED
▇▇▇▇ ▇▇▇▇▇▇▇▇ INCORPORATED
Acting severally on behalf of itself
and as representative of the several
Underwriters named on Schedule I
attached hereto
By: CIBC WORLD MARKETS CORP.
By: ____________________________________
Title:
-30-
SCHEDULE I
----------
Number of
Firm Shares to
Name Be Purchased
---- --------------
CIBC World Markets Corp.
Prudential Securities Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇ Incorporated
______________
TOTAL
-31-
EXHIBIT 5(h) TO UNDERWRITING AGREEMENT
LEGAL OPINION OF ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
------------------------------------
STATEMENTS:
We have acted as patent counsel to the Company with respect to the
patent matters reflected on Schedule A attached hereto (the "Relevant
Patent Matters").
We have read the Registration Statement and the Prospectus, including
in particular the portions of the Registration Statement and the
Prospectus under the captions "Risk Factors - __________________" and
"Business - Background, ________________" (such portions being
referred to herein, collectively, as the "Technology Portions").
OPINIONS:
1. The statements in the Technology Portions are accurate and fairly
present the matters of law and legal conclusions stated therein.
2. Nothing has come to our attention which has caused us to believe that
the Technology Portions contain any untrue statement of a material
fact with respect to the patent position of the Company, or omit to
state any material fact relating to the patent position of the
Company.
3. Nothing has come to our attention which has caused us to believe that
(a) any patent application referred to in the Relevant Patent Matters
was not properly prepared and filed, in accordance with all applicable
legal and procedural requirements, or is not in good standing, (b) the
issued patent (the "Issued Patent") referred to in the Relevant Patent
Matters was not properly obtained, in accordance with all applicable
legal and procedural requirements, or is not in good standing, (c)
that any invention described in any patent application or the issued
patent is not held by the Company, or (d) any relevant prior art has
not been disclosed promptly to the appropriate governmental agency.
4. To our knowledge, the Company has not received any notice asserting
any ownership rights contrary to those of the Company in any of the
Relevant Patent Matters.
5. To our knowledge, the Company has not received any notice challenging
the validity or enforceability of any Relevant Patent Matter.
6. To our knowledge, the Company has not received any notice of
infringement of,
-32-
or conflict with, rights or claims of others with respect to any
patent, trademark, service ▇▇▇▇, trade name, copyright or know-how.
7. To our knowledge, other than proceedings (except re-examination,
reissue or interference proceedings) of the various patent and
trademark offices, there are no legal or governmental proceedings
pending relating to any patent, patent application, trade secret,
trademark, service ▇▇▇▇ or other proprietary information or materials
of the Company and, to our knowledge, no such proceedings are
threatened or contemplated by governmental authorities or others.
-33-
