EXHIBIT 1.1
CEPHEID
5,000,000 Shares
Common Stock
(No par value per Share)
Underwriting Agreement
, 2004
Underwriting Agreement
, 2004
UBS Securities LLC
Xxxxxxx Xxxxx & Company, L.L.C.
C.E. Unterberg, Xxxxxx
Xxxxxx & Xxxxxxx, LLC
as Managing Underwriters
c/o UBS Securities LLC
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
Cepheid, a California corporation (the "Company"), proposes to issue and
sell to the underwriters named in Schedule A annexed hereto (the
"Underwriters"), for whom you are acting as representatives, an aggregate of
5,000,000 shares (the "Firm Shares") of common stock, no par value per share
(the "Common Stock"), of the Company. In addition, solely for the purpose of
covering over-allotments, the Company proposes to grant to the Underwriters the
option to purchase from the Company up to an additional 750,000 shares of Common
Stock (the "Additional Shares"). The Firm Shares and the Additional Shares are
hereinafter collectively sometimes referred to as the "Shares." The Shares are
described in the Prospectus which is referred to below.
The Company has filed, in accordance with the provisions of the Securities
Act of 1933, as amended, and the rules and regulations thereunder (collectively,
the "Act"), with the Securities and Exchange Commission (the "Commission") a
registration statement on Form S-3 (File No. 333-112074) including a prospectus,
relating to the Shares, which incorporates by reference documents which the
Company has filed in accordance with the provisions of the Securities Exchange
Act of 1934, as amended, and the rules and regulations thereunder (collectively,
the "Exchange Act"). The Company has furnished to you, for use by the
Underwriters and by dealers, copies of one or more preliminary prospectuses and
the documents incorporated by reference therein (each thereof, including the
documents incorporated therein by reference, being herein called a "Preliminary
Prospectus") relating to the Shares. Except where the context otherwise
requires, the registration statement, as amended when it becomes effective,
including all documents filed as a part thereof or incorporated by reference
therein, and including any information contained in a prospectus subsequently
filed with the Commission pursuant to Rule 424(b) under the Act and deemed to be
part of the registration statement at the time of effectiveness pursuant to Rule
430(A) under the Act and also including any registration statement filed
pursuant to Rule 462(b) under the Act, is herein called the "Registration
Statement," and the prospectus, including all documents incorporated therein by
reference, in the form filed by the Company with the Commission pursuant to Rule
424(b) under the Act on or before the second business day after the date hereof
(or such earlier time as may be required under the Act) or, if no such filing is
required, the form of final prospectus included in the Registration Statement at
the time it became effective, is herein called the "Prospectus." Any
reference herein to the terms "amend", "amendment" or "supplement" with respect
to the Registration Statement, any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include the filing of any document under the
Exchange Act after the effective date of the Registration Statement and through
and including the date on which any Prospectus may be required to be delivered,
or the Prospectus, as the case may be, deemed to be incorporated therein by
reference. Any reference herein to the registration statement, the Registration
Statement, any Preliminary Prospectus, or the Prospectus shall be deemed to
refer to and include (i) the documents incorporated by reference therein
pursuant to Form S-3 (the "Incorporated Documents") and (ii) the copy of the
Registration Statement, the Preliminary Prospectus, the Prospectus or the
Incorporated Documents filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system ("XXXXX"). As used herein, "business
day" shall mean a day on which the New York Stock Exchange is open for trading.
The Company and the Underwriters agree as follows:
1. Sale and Purchase. Upon the basis of the representations and warranties
and subject to the terms and conditions herein set forth, the Company agrees to
issue and sell to the respective Underwriters and each of the Underwriters,
severally and not jointly, agrees to purchase from the Company the number of
Firm Shares set forth opposite the name of such Underwriter in Schedule A
attached hereto, subject to adjustment in accordance with Section 8 hereof, in
each case at a purchase price of $ per Share. The Company is advised by you that
the Underwriters intend (i) to make a public offering of their respective
portions of the Firm Shares as soon after the effective date of the Registration
Statement as in your judgment is advisable and (ii) initially to offer the Firm
Shares upon the terms set forth in the Prospectus. You may from time to time
increase or decrease the public offering price after the initial public offering
to such extent as you may determine.
In addition, the Company hereby grants to the several Underwriters the
option to purchase, and upon the basis of the representations and warranties and
subject to the terms and conditions herein set forth, the Underwriters shall
have the right to purchase, severally and not jointly, from the Company, ratably
in accordance with the number of Firm Shares to be purchased by each of them,
all or a portion of the Additional Shares as may be necessary to cover
over-allotments made in connection with the offering of the Firm Shares, at the
same purchase price per share to be paid by the Underwriters to the Company for
the Firm Shares. This option may be exercised by UBS Securities LLC ("UBS") on
behalf of the several Underwriters at any time and from time to time on or
before the thirtieth day following the date of the Prospectus, by written notice
to the Company. Such notice shall set forth the aggregate number of Additional
Shares as to which the option is being exercised and the date and time when the
Additional Shares are to be delivered (such date and time being herein referred
to as the "additional time of purchase"); provided, however, that the additional
time of purchase shall not be earlier than the time of purchase (as defined
below) nor earlier than the second business day after the date on which the
option shall have been exercised nor later than the tenth business day after the
date on which the option shall have been exercised. The number of Additional
Shares to be sold to each Underwriter shall be the number which bears the same
proportion to the aggregate number of Additional Shares being purchased as the
number of Firm Shares set forth opposite the name of such Underwriter on
Schedule A hereto bears to the total number of Firm Shares (subject, in each
case, to such adjustment as you may determine to eliminate fractional
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shares), subject to adjustment in accordance with Section 8.
2. Payment and Delivery. Payment of the purchase price for the Firm Shares
shall be made to the Company by Federal Funds wire transfer against delivery of
the certificates for the Firm Shares to you through the facilities of The
Depository Trust Company ("DTC") for the respective accounts of the
Underwriters. Such payment and delivery shall be made at 10:00 A.M., New York
City time, on , 2004 (unless another time shall be agreed to by you and the
Company or unless postponed in accordance with the provisions of Section 8
hereof). The time at which such payment and delivery are to be made is
hereinafter sometimes called "the time of purchase." Electronic transfer of the
Firm Shares shall be made to you at the time of purchase in such names and in
such denominations as you shall specify.
Payment of the purchase price for the Additional Shares shall be made at
the additional time of purchase in the same manner and at the same office as the
payment for the Firm Shares. Electronic transfer of the Additional Shares shall
be made to you at the additional time of purchase in such names and in such
denominations as you shall specify.
Deliveries of the documents described in Section 6 hereof with respect to
the purchase of the Shares shall be made at the offices of Xxxxx Xxxxxxxxxx LLP
at 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 9:00 A.M., New York
City time, on the date of the closing of the purchase of the Firm Shares or the
Additional Shares, as the case may be.
3. Representations and Warranties of the Company. The Company represents
and warrants to and agrees with each of the Underwriters that:
(a) the Registration Statement has been declared effective under the
Act; no stop order of the Commission preventing or suspending the use of
any Preliminary Prospectus or the effectiveness of the Registration
Statement has been issued and no proceedings for such purpose have been
instituted or, to the Company's knowledge after due inquiry, are
contemplated by the Commission; each Preliminary Prospectus, at the time
of filing thereof, complied in all material respects to the requirements
of the Act and each Preliminary Prospectus distributed in connection with
the offering of the Shares did not, as of its date, and does not contain
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading;
the Registration Statement complied when it became effective, complies and
will comply, at the time of purchase, any additional time of purchase and
at any time at which the Prospectus is delivered in connection with any
sale of Shares, in all material respects with the requirements of the Act,
and the Prospectus will comply, as of its date and at the time of
purchase, any additional times of purchase and at any time at which the
Prospectus is delivered in connection with any sale of Shares, in all
material respects with the requirements of the Act, and any statutes,
regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be filed
as exhibits to the Registration Statement have been and will be so
described or filed; the conditions to the use of Form S-3 have been
satisfied; the Registration Statement did not when it became effective,
does not and will not, at the time of purchase, any additional time of
purchase and at any time at which the Prospectus
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is delivered in connection with any sale of Shares, contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading, and the Prospectus will not, as of its date and at the time of
purchase, any additional time of purchase and at any time at which the
Prospectus is delivered in connection with any sale of Shares, contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading;
provided, however, that the Company makes no warranty or representation
with respect to any statement contained in each Preliminary Prospectus,
the Registration Statement or the Prospectus in reliance upon and in
conformity with information concerning an Underwriter and furnished in
writing by or on behalf of such Underwriter through you to the Company
expressly for use in each Preliminary Prospectus, the Registration
Statement or the Prospectus; the documents incorporated by reference in
the Preliminary Prospectus, the Registration Statement and the Prospectus,
at the time they became effective or were filed with the Commission,
complied in all material respects with the requirements of the Exchange
Act and did not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they
were made, not misleading; and the Company has not distributed and will
not distribute any "prospectus" (within the meaning of the Act) or
offering material in connection with the offering or sale of the Shares
other than the Registration Statement, the Preliminary Prospectus and the
Prospectus;
(b) as of the date of this Agreement, the Company has an authorized
and outstanding capitalization as set forth in the section of the
Registration Statement and the Prospectus entitled "Capitalization" and
the description of its capital stock as set forth in the Registration
Statements on Form 8-A filed with the Commission on June 6, 2000 and
October 4, 2002 (collectively, the "Form 8-As"), and as of the time of
purchase and any additional time of purchase, as the case may be, the
Company shall have an authorized and outstanding capitalization as set
forth in the section of the Registration Statement and the Prospectus
entitled "Capitalization" and the Form 8-As (subject, in each case, to the
issuance of shares of Common Stock upon exercise of stock options
disclosed as outstanding in the Registration Statement and the Prospectus
and the grant of options under existing stock option plans and purchases
of shares of Common Stock under existing stock purchase plans, each as
described in the Registration Statement and the Prospectus); all of the
issued and outstanding shares of capital stock, including the Common
Stock, of the Company have been duly authorized and validly issued and are
fully paid and non-assessable, have been issued in compliance with all
federal and state securities laws and were not issued in violation of any
preemptive right, resale right, right of first refusal or similar right;
(c) the Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of
California, with full corporate power and authority to own, lease and
operate its properties and conduct its business as described in the
Registration Statement and the Prospectus, to execute and deliver this
Agreement and to issue, sell and deliver the Shares as contemplated
herein;
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(d) the Company is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction where the
ownership or leasing of its properties or the conduct of its business
requires such qualification, except where the failure to be so qualified
and in good standing would not, individually or in the aggregate, have any
reasonable possibility of having a material adverse effect on the
business, properties, financial condition, results of operation or
prospects of the Company and the Subsidiary (as hereinafter defined) taken
as a whole (a "Material Adverse Effect");
(e) the Company has no subsidiaries (as defined under the Act) other
than Cepheid Europe, S.A. (the "Subsidiary"); the Company owns all of the
issued and outstanding capital stock of the Subsidiary; other than the
capital stock of the Subsidiary, the Company does not own, directly or
indirectly, any shares of stock or any other equity or long-term debt
securities of any corporation or have any equity interest in any firm,
partnership, joint venture, association or other entity; complete and
correct copies of the charter and the bylaws of the Company and the
Subsidiary and all amendments thereto have been delivered to you, and,
except as set forth in the exhibits to the Registration Statement, no
changes therein will be made during the period from the date hereof
through and including the additional time of purchase; the Subsidiary has
been duly incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation, with
full corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Registration
Statement and the Prospectus; the Subsidiary is duly qualified to do
business as a foreign corporation and is in good standing in each
jurisdiction where the ownership or leasing of its properties or the
conduct of its business requires such qualification, except where the
failure to be so qualified and in good standing would not, individually or
in the aggregate, have a Material Adverse Effect; all of the outstanding
shares of capital stock of the Subsidiary have been duly authorized and
validly issued, are fully paid and non-assessable and are owned by the
Company subject to no security interest, other encumbrance or adverse
claims; and no options, warrants or other rights to purchase, agreements
or other obligations to issue or other rights to convert any obligation
into shares of capital stock or ownership interests in the Subsidiary are
outstanding;
(f) the Shares have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will be
duly and validly issued, fully paid and non-assessable and free of
statutory and contractual preemptive rights, resale rights, rights of
first refusal and similar rights;
(g) the capital stock of the Company, including the Shares, conforms
in all material respects to the description thereof contained in the
Registration Statement and the Prospectus, and the certificates for the
Shares are in due and proper form;
(h) this Agreement has been duly authorized, executed and delivered
by the Company;
(i) neither the Company nor the Subsidiary is in breach or violation
of or in default under (nor has any event occurred which with notice,
lapse of time or both would result in any breach or violation of,
constitute a default under or give the holder of
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any indebtedness (or a person acting on such holder's behalf) the right to
require the repurchase, redemption or repayment of all or a part of such
indebtedness under) (A) its respective charter or bylaws, or (B) any
indenture, mortgage, deed of trust, bank loan or credit agreement or other
evidence of indebtedness, or any license, lease, contract or other
agreement or instrument to which the Company or the Subsidiary is a party
or by which any of them or any of their properties may be bound or
affected, or (C) any federal, state, local or foreign law, regulation or
rule or any decree, judgment or order applicable to the Company or the
Subsidiary, except, in the case of clauses (B) and (C), to the extent that
any such conflict, breach, violation or default would not, individually or
in the aggregate, have a Material Adverse Effect; and the execution,
delivery and performance of this Agreement, the issuance and sale of the
Shares and the consummation of the transactions contemplated hereby will
not conflict with, result in any breach or violation of or constitute a
default under (nor constitute any event which with notice, lapse of time
or both would result in any breach or violation of or constitute a default
under or give the holder of any indebtedness (or a person acting on such
holder's behalf) the right to require the repurchase, redemption or
repayment of all or a part of such indebtedness under) (X) the charter or
bylaws of the Company or the Subsidiary, or (Y) any indenture, mortgage,
deed of trust, bank loan or credit agreement or other evidence of
indebtedness, or any license, lease, contract or other agreement or
instrument to which the Company or the Subsidiary is a party or by which
any of them or any of their respective properties may be bound or
affected, or (Z) any federal, state, local or foreign law, regulation or
rule or any decree, judgment or order applicable to the Company or the
Subsidiary, except, in the case of clause (Y), to the extent that any such
conflict, breach, violation or default would not, individually or in the
aggregate, have a Material Adverse Effect;
(j) no approval, authorization, consent or order of or filing with
any federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency, or of or with the National
Association of Securities Dealers Automated Quotation National Market
System ("NASDAQ"), or approval of the shareholders of the Company, is
required in connection with the issuance and sale of the Shares or the
consummation by the Company of the transactions contemplated hereby other
than registration of the Shares under the Act, which has been effected,
and any necessary qualification under the securities or blue sky laws of
the various jurisdictions in which the Shares are being offered by the
Underwriters or under the rules and regulations of the National
Association of Securities Dealers, Inc. ("NASD");
(k) except as expressly set forth in the Registration Statement and
the Prospectus, (i) no person has the right, contractual or otherwise, to
cause the Company to issue or sell to it any shares of Common Stock or
shares of any other capital stock or other equity interests of the
Company, (ii) no person has any preemptive rights, resale rights, rights
of first refusal or other rights to purchase any shares of Common Stock or
shares of any other capital stock of or other equity interests in the
Company and (iii) other than UBS Securities LLC, no person has the right
to act as an underwriter or as a financial advisor to the Company in
connection with the offer and sale of the Shares, in the case of each of
the foregoing clauses (i), (ii) and (iii), whether as a result of the
filing or effectiveness of the Registration Statement or the sale of the
Shares as contemplated thereby or otherwise; except as set forth in the
Amended and Restated Investor Rights Agreement dated January 21, 2000 by
and among the Company and the investor parties thereto (the "Investor
Rights Agreement"), no person has the right, contractual or otherwise, to
cause the Company to register under the Act any shares of Common Stock or
shares of any other capital stock of or other equity interests in the
Company, or to include any such shares or interests in the Registration
Statement or the offering contemplated thereby, whether as a result of the
filing or effectiveness of the Registration Statement or the sale of the
Shares as contemplated
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thereby or otherwise; all of the shares (or other equity interests)
subject to the Investor Rights Agreement may be sold or transferred,
without registration under the Act, in reliance on Rule 144 of the Act
("Rule 144"), and no person who may be deemed an "affiliate" of the
Company (as such term is defined under Rule 144) having any right to cause
the Company to register any securities under the Investor Rights Agreement
has securities in excess of one percent of the outstanding capital stock
of the Company and each such person is entitled to rely on Rule 144 for
sales of such shares without registration under the Act;
(l) each of the Company and the Subsidiary has all necessary
licenses, authorizations, consents and approvals and has made all
necessary filings required under any federal, state, local or foreign law,
regulation or rule, and has obtained all necessary licenses,
authorizations, consents and approvals from other persons, in order to
conduct its respective business as described in the Registration Statement
and the Prospectus, except in each case as would not, individually or in
the aggregate, have a Material Adverse Effect; neither the Company nor the
Subsidiary is in violation of, or in default under, or has received notice
of any proceedings relating to revocation or modification of, any such
license, authorization, consent or approval or any federal, state, local
or foreign law, regulation or rule or any decree, order or judgment
applicable to the Company or the Subsidiary, except where such violation,
default, revocation or modification would not, individually or in the
aggregate, have a Material Adverse Effect;
(m) all legal or governmental proceedings, affiliate transactions,
off-balance sheet transactions (including, without limitation,
transactions related to, and the existence of, "variable interest
entities" within the meaning of Financial Accounting Standards Board
Interpretation No. 46), contracts, licenses, agreements, leases or
documents of a character required to be described in the Registration
Statement or the Prospectus or to be filed as an exhibit to the
Registration Statement have been so described or filed as required;
(n) there are no actions, suits, claims, investigations or
proceedings pending or, to the Company's knowledge, threatened or
contemplated to which the Company or the Subsidiary or any of their
respective directors or officers is or would be a party or of which any of
their respective properties is or would be subject at law or in equity,
before or by any federal, state, local or foreign governmental or
regulatory commission, board, body, authority or agency, except any such
action, suit, claim, investigation or proceeding which would not result in
a judgment, decree or order having, individually or in the aggregate, a
Material Adverse Effect or preventing consummation of the transactions
contemplated hereby;
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(o) Ernst & Young LLP, whose report on the consolidated financial
statements of the Company and the Subsidiary is included in the
Registration Statement and the Prospectus, are independent public
accountants as required by the Act and by Rule 3600T of the Public Company
Accounting Oversight Board (the "PCAOB");
(p) the financial statements included in the Registration Statement
and the Prospectus, together with the related notes and schedules, present
fairly the consolidated financial position of the Company and the
Subsidiary as of the dates indicated and the consolidated results of
operations and cash flows of the Company and the Subsidiary for the
periods specified and have been prepared in compliance with the
requirements of the Act and in conformity with generally accepted
accounting principles applied on a consistent basis during the periods
involved; the other financial and statistical data set forth in the
Registration Statement and the Prospectus are accurately presented and
prepared on a basis consistent with the financial statements and books and
records of the Company; there are no financial statements (historical or
pro forma) that are required to be included in the Registration Statement
and the Prospectus (including, without limitation, as required by Rules
3-12 or 3-05 or Article 11 of Regulation S-X under the Act) that are not
included as required; the Company and the Subsidiary do not have any
material liabilities or obligations, direct or contingent (including any
off-balance sheet obligations or any "variable interest entities" within
the meaning of Financial Accounting Standards Board Interpretation No.
46), not disclosed in the Registration Statement and the Prospectus; and
all disclosures contained in the Registration Statement or the Prospectus
regarding "non-GAAP financial measures" (as such term is defined by the
rules and regulations of the Commission) comply with Regulation G of the
Exchange Act, and the rules and regulations thereunder, and Item 10 of
Regulation S-K under the Act, to the extent applicable;
(q) subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not been
(i) any material adverse change, or any development involving a
prospective material adverse change, in the business, properties,
management, financial condition or results of operations of the Company
and the Subsidiary taken as a whole, (ii) any transaction which is
material to the Company and the Subsidiary taken as a whole, (iii) any
obligation, direct or contingent (including any off-balance sheet
obligations), incurred by the Company or the Subsidiary, which is material
to the Company and the Subsidiary taken as a whole, (iv) any change in the
capital stock (other than as a result of the exercise of options,
exercises under the Company's employee stock purchase plan or the grant of
stock options or other stock awards under the Company's benefit plans, in
each case disclosed as either outstanding or reserved for future issuance
in the Registration Statement and the Prospectus) or any increase in
outstanding indebtedness of the Company or the Subsidiary in excess of
$5,000,000 or (v) any dividend or distribution of any kind declared, paid
or made on the capital stock of the Company;
(r) the Company has obtained for the benefit of the Underwriters the
agreement (a "Lock-Up Agreement"), in the form set forth as Exhibit A
hereto, of each of its directors and executive officers;
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(s) neither the Company nor the Subsidiary is and, after giving
effect to the offering and sale of the Shares, none of them will be, an
"investment company" or an entity "controlled" by an "investment company,"
as such terms are defined in the Investment Company Act of 1940, as
amended (the "Investment Company Act"), or a "passive foreign investment
company" or a "controlled foreign corporation," as such terms are defined
in the Internal Revenue Code;
(t) the Company and the Subsidiary have good and marketable title to
all property (real and personal) described in the Registration Statement
or the Prospectus as being owned by each of them, free and clear of all
liens, claims, security interests or other encumbrances, subject only to
such exceptions as are not material and do not interfere with the use made
and proposed to be made of such property by the Company or the Subsidiary;
all the property described in the Registration Statement and the
Prospectus as being held under lease by the Company or the Subsidiary is
held thereby under valid, subsisting and enforceable leases;
(u) except as set forth in the Registration Statement and the
Prospectus, the Company and the Subsidiary own, or have obtained valid and
enforceable licenses for, or other rights to use, the inventions, patent
applications, patents, trademarks (both registered and unregistered),
tradenames, service names, copyrights, trade secrets and other proprietary
information described in the Registration Statement or the Prospectus as
being owned or licensed by them or which are necessary for the conduct of
their respective businesses, except where the failure to own, license or
have such rights would not, individually or in the aggregate, have a
Material Adverse Effect (collectively, "Intellectual Property"); (i)
except as set forth in the Registration Statement and the Prospectus, to
the Company's knowledge, there are no third parties who have, or will be
able to establish, rights to any Intellectual Property, except for the
rights of the owners or licensees of the Intellectual Property which are
licensed to, or by, the Company; (ii) to the Company's knowledge, there is
no infringement by third parties of any Intellectual Property owned by the
Company; (iii) there is no material pending or, to the Company's
knowledge, threatened action, suit, proceeding or claim by others
challenging the Company's or the Subsidiary's rights in or to any
Intellectual Property, and the Company is unaware of any facts which could
form a reasonable basis for any such action, suit, proceeding or claim;
(iv) there is no pending or, to the Company's knowledge, threatened
action, suit, proceeding or claim by others challenging the validity or
scope of any Intellectual Property, and the Company is unaware of any
facts which could form a reasonable basis for any such action, suit,
proceeding or claim; (v) there is no pending or threatened action, suit,
proceeding or claim by others alleging that the Company or the Subsidiary
infringes or otherwise violates any patent, trademark, tradename, service
name, copyright, trade secret or other proprietary rights of others, and,
except as set forth in the Registration Statement and the Prospectus, the
Company is unaware of any facts which could form a reasonable basis for
any such action, suit, proceeding or claim; (vi) to the Company's
knowledge, there is no patent or patent application that contains claims
that materially interfere with the issued or pending claims of any of the
Intellectual Property; and (vii) to the Company's knowledge, there is no
prior art that could reasonably be expected to render any patent
application owned by the Company or the Subsidiary unpatentable that has
not been disclosed to the U.S. Patent and Trademark
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Office;
(v) neither the Company nor the Subsidiary is engaged in any unfair
labor practice; except for matters which would not, individually or in the
aggregate, have a Material Adverse Effect, (i) there is (A) no unfair
labor practice complaint pending or, to the Company's knowledge,
threatened against the Company or the Subsidiary before the National Labor
Relations Board or any similar body, and no grievance or arbitration
proceeding arising out of or under collective bargaining agreements is
pending or threatened, (B) no strike, labor dispute, slowdown or stoppage
pending or, to the Company's knowledge, threatened against the Company or
the Subsidiary and (C) no union representation dispute currently existing
concerning the employees of the Company or the Subsidiary, and (ii) to the
Company's knowledge, (A) no union organizing activities are currently
taking place concerning the employees of the Company or the Subsidiary and
(B) there has been no violation of any federal, state, local or foreign
law relating to discrimination in the hiring, promotion or pay of
employees, any applicable wage or hour laws or any provision of the
Employee Retirement Income Security Act of 1974 ("ERISA") or the rules and
regulations promulgated thereunder, or any similar law, concerning the
employees of the Company or the Subsidiary;
(w) the Company and the Subsidiary and their respective properties,
assets and operations are in compliance with, and hold all permits,
authorizations and approvals required under, Environmental Laws (as
defined below), except to the extent that failure to so comply or to hold
such permits, authorizations or approvals would not, individually or in
the aggregate, have a Material Adverse Effect; there are no past, present
or, to the Company's knowledge, reasonably anticipated future events,
conditions, circumstances, activities, practices, actions, omissions or
plans of the Company or the Subsidiary or, to the Company's knowledge, of
any other person that could reasonably be expected to give rise to any
material costs or liabilities to the Company or the Subsidiary under, or
to interfere with or prevent compliance by the Company or the Subsidiary
with, Environmental Laws; except as would not, individually or in the
aggregate, have a Material Adverse Effect, neither the Company nor the
Subsidiary (i) is the subject of any investigation, (ii) has received any
written notice or claim, (iii) is a party to or affected by any pending or
threatened action, suit or proceeding, (iv) is bound by any judgment,
decree or order or (v) has entered into any agreement, in each case
relating to any alleged violation of any Environmental Law or any actual
or alleged release or threatened release or cleanup at any location of any
Hazardous Materials (as defined below) (as used herein, "Environmental
Law" means any federal, state, local or foreign law, statute, ordinance,
rule, regulation, order, decree, judgment, injunction, permit, license,
authorization or other binding requirement, or common law, relating to
health, safety or the protection, cleanup or restoration of the
environment or natural resources, including those relating to the
distribution, processing, generation, treatment, storage, disposal,
transportation, other handling or release or threatened release of
Hazardous Materials, and "Hazardous Materials" means any material
(including, without limitation, pollutants, contaminants, hazardous or
toxic substances or wastes) that is regulated by or may give rise to
liability under any Environmental Law);
- 10 -
(x) in the ordinary course of its business, the Company and the
Subsidiary conducts a periodic review of the effect of the Environmental
Laws on its business, operations and properties, in the course of which it
identifies and evaluates associated costs and liabilities (including,
without limitation, any capital or operating expenditures required for
cleanup, closure of properties or compliance with the Environmental Laws
or any permit, license or approval, any related constraints on operating
activities and any potential liabilities to third parties);
(y) all material tax returns required to be filed by the Company and
the Subsidiary have been filed, and all material taxes and other
assessments of a similar nature (whether imposed directly or through
withholding) including any interest, additions to tax or penalties
applicable thereto due or claimed to be due from such entities have been
paid, other than those being contested in good faith and for which
adequate reserves have been provided;
(z) the Company and the Subsidiary maintain insurance covering its
properties, operations, personnel and businesses as the Company deems
adequate; such insurance insures against such losses and risks to an
extent which the Company reasonably believes is adequate in accordance
with customary industry practice to protect the Company and the Subsidiary
and their businesses; all such insurance is fully in force on the date
hereof and will be fully in force at the time of purchase and any
additional time of purchase;
(aa) neither the Company nor the Subsidiary has sustained since the
date of the last audited financial statements included in the Registration
Statement and the Prospectus any loss or interference with its respective
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental
action, order or decree, except as would not, individually or in the
aggregate, have a Material Adverse Effect;
(bb) the Company has not sent or received any communication
regarding termination of, or intent not to renew, any of the contracts or
agreements referred to or described in, or filed as an exhibit to, the
Registration Statement, and no such termination or non-renewal has been
threatened by the Company or, to the Company's knowledge, any other party
to any such contract or agreement;
(cc) the Company and the Subsidiary maintains a system of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or
specific authorization; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded accountability
for assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences;
(dd) the Company has established and maintains and evaluates
- 11 -
"disclosure controls and procedures" (as such term is defined in Rule
13a-15 and 15d-15 under the Exchange Act) and "internal control over
financial reporting" (as such term is defined in Rule 13a-15 and 15d-15
under the Exchange Act); such disclosure controls and procedures are
designed to ensure that material information relating to the Company,
including the Subsidiary, is made known to the Company's Chief Executive
Officer and its Chief Financial Officer by others within those entities,
and such disclosure controls and procedures are effective to perform the
functions for which they were established; the Company's auditors and the
Audit Committee of the Board of Directors of the Company have been advised
of: (i) any significant deficiencies in the design or operation of
internal controls known to the Company which could adversely affect the
Company's ability to record, process, summarize, and report financial
data; and (ii) any fraud known to the Company, whether or not material,
that involves management or other employees who have a role in the
Company's internal controls; any material weaknesses in internal controls
known to the Company have been identified for the Company's auditors; and
since the date of the most recent evaluation of such disclosure controls
and procedures, there have been no significant changes in internal
controls or in other factors that could significantly affect internal
controls, including any corrective actions with regard to significant
deficiencies and material weaknesses; and since the date of the most
recent evaluation of such disclosure controls and procedures, there have
been no significant changes in internal controls or in other factors that
could significantly affect internal controls, including any corrective
actions with regard to significant deficiencies and material weaknesses;
the principal executive officers (or their equivalents) and principal
financial officers (or their equivalents) of the Company have made all
certifications required by the Xxxxxxxx-Xxxxx Act of 2002 (the
"Xxxxxxxx-Xxxxx Act") and any related rules and regulations promulgated by
the Commission; and the Company and, to the Company's knowledge, its
officers and directors (in their capacities as such) are in compliance in
all material respects with all applicable effective provisions of the
Xxxxxxxx-Xxxxx Act and the rules and regulations of the Commission and the
NASDAQ promulgated thereunder;
(ee) the Company has provided you with true, correct and complete
copies of all documentation pertaining to any extension of credit in the
form of a personal loan made, directly or indirectly, by the Company or
the Subsidiary to any director or executive officer of the Company, or to
any family member or affiliate of any director or executive officer of the
Company; and on or after July 30, 2002, the Company has not, directly or
indirectly, including through the Subsidiary: (i) extended credit,
arranged to extend credit, or renewed any extension of credit, in the form
of a personal loan, to or for any director or executive officer of the
Company, or to or for any family member or affiliate of any director or
executive officer of the Company; or (ii) made any material modification,
including any renewal thereof, to any term of any personal loan to any
director or executive officer of the Company, or any family member or
affiliate of any director or executive officer, which loan was outstanding
on July 30, 2002;
(ff) all statistical or market-related data included in the
Registration Statement or the Prospectus are based on or derived from
sources that the Company believes to be reliable and accurate, and the
Company has obtained the written consent to the use of such data from such
sources to the extent required;
- 12 -
(gg) neither the Company nor the Subsidiary nor, to the Company's
knowledge, any employee or agent of the Company or the Subsidiary has made
any payment of funds of the Company or the Subsidiary or received or
retained any funds in violation of any law, rule or regulation, which
payment, receipt or retention of funds is of a character required to be
disclosed in the Registration Statement or the Prospectus;
(hh) except pursuant to this Agreement, neither the Company nor the
Subsidiary has incurred any liability for any finder's or broker's fee or
agent's commission in connection with the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby or
by the Prospectus;
(ii) except to the extent disclosed in the Registration Statement
and the Prospectus, the Company has operated and currently is in
compliance in all material respects with all applicable rules, regulations
and policies of the U.S. Food and Drug Administration and comparable drug
regulatory agencies outside of the United States in which its products are
sold or tested (collectively, the "Regulatory Authorities");
(jj) neither the Company nor the Subsidiary nor any of their
respective directors, officers, affiliates or controlling persons has
taken, directly or indirectly, any action designed, or which has
constituted or might reasonably be expected to cause or result in, under
the Exchange Act or otherwise, the stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale of
the Shares;
(kk) to the Company's knowledge after reasonable inquiry, there are
no affiliations or associations between any member of the NASD and any of
the Company's officers, directors or 5% or greater securityholders, except
as set forth in the Registration Statement and the Prospectus; and
(ll) the Company has not offered, or caused the Underwriters to
offer, Shares to any person with the intent to influence unlawfully (A) a
customer or supplier of the Company or the Subsidiary to alter the
customer's or supplier's level or type of business with the Company or the
Subsidiary or (B) a trade journalist or publication to write or publish
favorable information about the Company or the Subsidiary or any of their
respective products or services.
In addition, any certificate signed by any officer of the Company or the
Subsidiary and delivered to the Underwriters or counsel for the Underwriters in
connection with the offering of the Shares shall be deemed to be a
representation and warranty by the Company or the Subsidiary, as the case may
be, as to matters covered thereby, to each Underwriter.
4. Certain Covenants of the Company. The Company hereby agrees:
(a) to furnish such information as may be required and otherwise to
cooperate in qualifying the Shares for offering and sale under the
securities or blue sky laws of such states or other jurisdictions as you
may designate and to maintain such qualifications in effect so long as you
may request for the distribution of the Shares; provided, however, that
the Company shall not be required to qualify as a foreign corporation or
to consent to the service of process under the laws of any such
jurisdiction
- 13 -
(except service of process with respect to the offering and sale of the
Shares); and to promptly advise you of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Shares for offer or sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose;
(b) to make available to the Underwriters in New York City, as soon
as practicable after the Registration Statement becomes effective, and
thereafter from time to time to furnish to the Underwriters, as many
copies of the Prospectus (or of the Prospectus as amended or supplemented
if the Company shall have made any amendments or supplements thereto after
the effective date of the Registration Statement) as the Underwriters may
request for the purposes contemplated by the Act; in case any Underwriter
is required to deliver a prospectus after the nine-month period referred
to in Section 10(a)(3) of the Act in connection with the sale of the
Shares, the Company will prepare, at its expense, promptly upon request
such amendment or amendments to the Registration Statement and the
Prospectus as may be necessary to permit compliance with the requirements
of Section 10(a)(3) of the Act;
(c) if, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or any post-effective amendment
thereto to be declared effective before the Shares may be sold, the
Company will endeavor to cause the Registration Statement or such
post-effective amendment to become effective as soon as possible, and the
Company will advise you promptly and, if requested by you, will confirm
such advice in writing, (i) when the Registration Statement and any such
post-effective amendment thereto has become effective, and (ii) if Rule
430A under the Act is used, when the Prospectus is filed with the
Commission pursuant to Rule 424(b) under the Act (which the Company agrees
to file in a timely manner under such Rule);
(d) to advise you promptly, confirming such advice in writing, of
any request by the Commission for amendments or supplements to the
Registration Statement or the Prospectus or for additional information
with respect thereto, or of notice of institution of proceedings for, or
the entry of a stop order, suspending the effectiveness of the
Registration Statement and, if the Commission should enter a stop order
suspending the effectiveness of the Registration Statement, to use its
best efforts to obtain the lifting or removal of such order as soon as
possible; to advise you promptly of any proposal to amend or supplement
the Registration Statement or the Prospectus, including by filing any
documents that would be incorporated therein by reference, and to provide
you and Underwriters' counsel copies of any such documents for review and
comment a reasonable amount of time prior to any proposed filing and to
file no such amendment or supplement to which you shall object in writing;
(e) to file promptly all reports and any definitive proxy or
information statement required to be filed by the Company with the
Commission in order to comply with the Exchange Act subsequent to the date
of the Prospectus and for so long as the delivery of a prospectus is
required in connection with the offering or sale of the Shares; and to
provide you with a copy of such reports and statements and other documents
to be filed by the Company pursuant to Section 13, 14 or 15(d) of the
Exchange Act during such period for your review and comment a reasonable
amount of time prior to any
- 14 -
proposed filing, and to file no such report, statement or document to
which you shall reasonably object in writing, and to promptly notify you
of any such filing;
(f) if necessary or appropriate, to file a registration statement
pursuant to Rule 462(b) under the Act and pay the applicable fees in
accordance with the Act;
(g) to advise the Underwriters promptly of the happening of any
event within the time during which a prospectus relating to the Shares is
required to be delivered under the Act which could reasonably be expected
to require the making of any change in the Prospectus then being used so
that the Prospectus would not include an untrue statement of material fact
or omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they are made, not
misleading, and, during such time, subject to Section 4(d) hereof, to
prepare and furnish, at the Company's expense, to the Underwriters
promptly such amendments or supplements to such Prospectus as may be
necessary to reflect any such change;
(h) to make generally available to its security holders, and to
deliver to you, an earnings statement of the Company (which will satisfy
the provisions of Section 11(a) of the Act) covering a period of twelve
months beginning after the effective date of the Registration Statement
(as defined in Rule 158(c) under the Act) as soon as is reasonably
practicable after the termination of such twelve-month period but in any
case not later than March 1, 2005;
(i) to furnish to its shareholders as soon as practicable after the
end of each fiscal year an annual report (including a consolidated balance
sheet and statements of income, shareholders' equity and cash flow of the
Company and the Subsidiary for such fiscal year, accompanied by a copy of
the certificate or report thereon of nationally recognized independent
certified public accountants duly registered with the PCAOB);
(j) to furnish to you five copies of the Registration Statement, as
initially filed with the Commission, and of all amendments thereto
(including all exhibits thereto and documents incorporated by reference)
and sufficient copies of the foregoing (other than exhibits) for
distribution of a copy to each of the other Underwriters;
(k) to furnish to you promptly and, upon request, to each of the
other Underwriters for a period of five years from the date of this
Agreement (i) copies of any reports, proxy statements, or other
communications which the Company shall send to its stockholders or shall
from time to time publish or publicly disseminate, (ii) copies of all
annual, quarterly, transition and current reports filed with the
Commission on Forms 10-K, 10-Q or 8-K, or such other similar forms as may
be designated by the Commission, (iii) copies of documents or reports
filed with any national securities exchange on which any class of
securities of the Company is listed and (iv) such other information as you
may reasonably request regarding the Company or the Subsidiary, provided,
however, that in no case shall the Company be required to furnish
materials pursuant to this paragraph which are filed and publicly
accessible via the XXXXX database;
(l) to furnish to you as early as practicable prior to the time of
- 15 -
purchase and any additional time of purchase, as the case may be, but not
later than two business days prior thereto, a copy of the latest available
unaudited interim and (on a confidential basis) monthly consolidated
financial statements, if any, of the Company and the Subsidiary which have
been read by the Company's independent certified public accountants, as
stated in their letter to be furnished pursuant to Section 6(d) hereof;
(m) to apply the net proceeds from the sale of the Shares in the
manner set forth under the caption "Use of proceeds" in the Prospectus;
(n) to pay all costs, expenses, fees and taxes in connection with
(i) the preparation and filing of the Registration Statement, each
Preliminary Prospectus, the Prospectus, and any amendments or supplements
thereto, and the printing and furnishing of copies of each thereof to the
Underwriters and to dealers (including costs of mailing and shipment),
(ii) the registration, issue, sale and delivery of the Shares including
any stock or transfer taxes and stamp or similar duties payable upon the
sale, issuance or delivery of the Shares to the Underwriters, (iii) the
producing, word processing and/or printing of this Agreement, any
Agreement Among Underwriters, any dealer agreements, any Powers of
Attorney and any closing documents (including compilations thereof) and
the reproduction and/or printing and furnishing of copies of each thereof
to the Underwriters and (except closing documents) to dealers (including
costs of mailing and shipment), (iv) the qualification of the Shares for
offering and sale under state or foreign laws and the determination of
their eligibility for investment under state or foreign law as aforesaid
(including the filing fees and reasonable legal fees and other
disbursements of counsel for the Underwriters) and the printing and
furnishing of copies of any blue sky surveys or legal investment surveys
to the Underwriters and to dealers, (v) any listing of the Shares on any
securities exchange or qualification of the Shares for quotation on the
NASDAQ and any registration thereof under the Exchange Act, (vi) any
filing for review of the public offering of the Shares by the NASD,
including the filing fees and reasonable legal fees and other
disbursements of counsel to the Underwriters, (vii) the fees and
disbursements of any transfer agent or registrar for the Shares, (viii)
the costs and expenses of the Company relating to presentations or
meetings undertaken in connection with the marketing of the offering and
sale of the Shares to prospective investors and the Underwriters' sales
forces, including, without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any
consultants engaged in connection with the road show presentations,
travel, lodging and other expenses incurred by the officers of the Company
and any such consultants, and the cost of any aircraft chartered in
connection with the road show and (ix) the performance of the Company's
other obligations hereunder;
(o) not to sell, offer to sell, contract or agree to sell,
hypothecate, pledge, grant any option to purchase or otherwise dispose of
or agree to dispose of, directly or indirectly, any Common Stock or
securities convertible into or exchangeable or exercisable for Common
Stock or warrants or other rights to purchase Common Stock or any other
securities of the Company that are substantially similar to Common Stock,
or file or cause to be declared effective a registration statement under
the Act relating to the offer and sale of any shares of Common Stock or
securities convertible into or exercisable or exchangeable for Common
Stock or warrants or other rights to purchase
- 16 -
Common Stock or any other securities of the Company that are substantially
similar to Common Stock for a period of 90 days after the date hereof (the
"Lock-Up Period"), without the prior written consent of UBS, except for
(i) the registration of the Shares and the sales to the Underwriters
pursuant to this Agreement, (ii) issuances of Common Stock upon the
exercise of options or warrants disclosed as outstanding in the
Registration Statement and the Prospectus, (iii) the issuance of stock
options to employees or consultants of the Company not exercisable during
the Lock-Up Period pursuant to stock option plans described in the
Registration Statement and the Prospectus and (iv) issuances of Common
Stock pursuant to the Company's employee stock purchase plan described in
the Registration Statement and the Prospectus;
(p) to comply with all the undertakings contained in the
Registration Statement;
(q) to use its best efforts to cause the Common Stock to be listed
for quotation on the NASDAQ and to maintain such listing; and
(r) to maintain a transfer agent and, if necessary under the
jurisdiction of incorporation of the Company, a registrar for the Common
Stock.
5. Reimbursement of Underwriters' Expenses. If the Shares are not
delivered for any reason other than the termination of this Agreement pursuant
to the fifth paragraph of Section 8 hereof or the default by one or more of the
Underwriters in its or their respective obligations hereunder, the Company
shall, in addition to paying the amounts described in Section 4(n) hereof,
reimburse the Underwriters for all of their out-of-pocket accountable expenses
actually incurred, including the fees and disbursements of their counsel.
6. Conditions of Underwriters' Obligations. The several obligations of the
Underwriters hereunder are subject to the accuracy of the representations and
warranties on the part of the Company on the date hereof, at the time of
purchase and, if applicable, at the additional time of purchase, the performance
by the Company of its obligations hereunder and to the following additional
conditions precedent:
(a) The Company shall furnish to you at the time of purchase and, if
applicable, at the additional time of purchase, an opinion of Fenwick &
West LLP, counsel for the Company, addressed to the Underwriters, and
dated the time of purchase or the additional time of purchase, as the case
may be, with executed copies for each of the other Underwriters, and in
form and substance satisfactory to Xxxxx Xxxxxxxxxx LLP, counsel for the
Underwriters, in the form set forth in Exhibit B hereto.
(b) The Company shall furnish to you at the time of purchase and, if
applicable, at the additional time of purchase, an opinion of Xxxxxxxx and
Xxxxxxxx and Crew LLP, special counsel for the Company with respect to
patents and proprietary rights, addressed to the Underwriters, and dated
the time of purchase or the additional time of purchase, as the case may
be, with executed copies for each of the other Underwriters, and in form
and substance satisfactory to Xxxxx Xxxxxxxxxx LLP, counsel for the
Underwriters, in the form set forth in Exhibit C hereto.
- 17 -
(c) The Company shall furnish to you at the time of purchase and, if
applicable, at the additional time of purchase, an opinion of Xxxxx
Amalric, special counsel for the Company with respect to the Subsidiary,
addressed to the Underwriters, and dated the time of purchase or the
additional time of purchase, as the case may be, with executed copies for
each of the other Underwriters, and in form and substance satisfactory to
Xxxxx Xxxxxxxxxx LLP, counsel for the Underwriters, in the form set forth
in Exhibit D hereto.
(d) You shall have received from Ernst & Young LLP letters dated,
respectively, the date of this Agreement, the time of purchase and, if
applicable, the additional time of purchase, and addressed to the
Underwriters (with executed copies for each of the Underwriters) in the
forms heretofore approved by UBS.
(e) You shall have received at the time of purchase and, if
applicable, at the additional time of purchase, an opinion of Xxxxx
Xxxxxxxxxx LLP, counsel for the Underwriters, dated the time of purchase
or the additional time of purchase, as the case may be, in form and
substance reasonably satisfactory to UBS.
(f) No Prospectus or amendment or supplement to the Registration
Statement or the Prospectus, including documents deemed to be incorporated
by reference therein, shall have been filed to which you reasonably object
in writing.
(g) The Registration Statement shall become effective not later than
5:30 P.M. New York City time on the date of this Agreement and, if Rule
430A under the Act is used, the Prospectus shall have been filed with the
Commission pursuant to Rule 424(b) under the Act at or before 5:30 P.M.,
New York City time, on or prior to the second full business day after the
date of this Agreement and any registration statement pursuant to Rule
462(b) under the Act required in connection with the offering and sale of
the Shares shall have been filed and become effective no later than 10:00
P.M., New York City time, on the date of this Agreement.
(h) Prior to the time of purchase, and, if applicable, the
additional time of purchase, (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued under
the Act or proceedings initiated under Section 8(d) or 8(e) of the Act;
(ii) the Registration Statement and all amendments thereto shall not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading; and (iii) the Prospectus and all amendments or
supplements thereto shall not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they are made, not misleading.
(i) Between the time of execution of this Agreement and the time of
purchase or the additional time of purchase, as the case may be, (A) no
material adverse change or any development involving a prospective
material adverse change in the business, properties, management, financial
condition or results of operations of the Company and the Subsidiary taken
as a whole shall occur or become known and (B) no
- 18 -
transaction which is material and adverse to the Company has been entered
into by the Company or the Subsidiary.
(j) The Company will, at the time of purchase and, if applicable, at
the additional time of purchase, deliver to you a certificate of its Chief
Executive Officer and its Chief Financial Officer in the form attached as
Exhibit E hereto.
(k) You shall have received signed Lock-up Agreements referred to in
Section 3(r) hereof.
(l) The Company shall have furnished to you such other documents and
certificates as to the accuracy and completeness of any statement in the
Registration Statement and the Prospectus as of the time of purchase and,
if applicable, the additional time of purchase, as you may reasonably
request.
(m) The Shares shall have been approved for quotation on the NASDAQ,
subject only to notice of issuance at or prior to the time of purchase or
the additional time of purchase, as the case may be.
7. Effective Date of Agreement; Termination. This Agreement shall become
effective (i) if Rule 430A under the Act is not used, when you shall have
received notification of the effectiveness of the Registration Statement, or
(ii) if Rule 430A under the Act is used, when the parties hereto have executed
and delivered this Agreement.
The obligations of the several Underwriters hereunder shall be subject to
termination in the absolute discretion of UBS or any group of Underwriters
(which may include UBS) which has agreed to purchase in the aggregate at least
50% of the Firm Shares, if (x) since the time of execution of this Agreement or
the earlier respective dates as of which information is given in the
Registration Statement and the Prospectus, there has been any material adverse
change or any development involving a prospective material adverse change in the
business, properties, management, financial condition or results of operations
of the Company and the Subsidiary taken as a whole, which would, in UBS's
judgment or in the judgment of such group of Underwriters, make it impracticable
or inadvisable to proceed with the public offering or the delivery of the Shares
on the terms and in the manner contemplated in the Registration Statement and
the Prospectus, or (y) since the time of execution of this Agreement, there
shall have occurred: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange, the American Stock Exchange
or the NASDAQ; (ii) a suspension or material limitation in trading in the
Company's securities on the NASDAQ; (iii) a general moratorium on commercial
banking activities declared by either federal or New York State authorities or a
material disruption in commercial banking or securities settlement or clearance
services in the United States; (iv) an outbreak or escalation of hostilities or
acts of terrorism involving the United States or a declaration by the United
States of a national emergency or war; or (v) any other calamity or crisis or
any change in financial, political or economic conditions in the United States
or elsewhere, if the effect of any such event specified in clause (iv) or (v) in
UBS's judgment or in the judgment of such group of Underwriters makes it
impracticable or inadvisable to proceed with the public offering or the delivery
of the Shares on the terms and in the manner contemplated in the Registration
Statement and the Prospectus, or (z) since the time
- 19 -
of execution of this Agreement, there shall have occurred any downgrading, or
any notice or announcement shall have been given or made of (i) any intended or
potential downgrading or (ii) any watch, review or possible change that does not
indicate an affirmation or improvement in the rating accorded any securities of
or guaranteed by the Company or the Subsidiary by any "nationally recognized
statistical rating organization," as that term is defined in Rule 436(g)(2)
under the Act.
If UBS or any group of Underwriters elects to terminate this Agreement as
provided in this Section 7, the Company and each other Underwriter shall be
notified promptly in writing.
If the sale to the Underwriters of the Shares, as contemplated by this
Agreement, is not carried out by the Underwriters for any reason permitted under
this Agreement, or if such sale is not carried out because the Company shall be
unable to comply with any of the terms of this Agreement, the Company shall not
be under any obligation or liability under this Agreement (except to the extent
provided in Sections 4(n), 5 and 9 hereof), and the Underwriters shall be under
no obligation or liability to the Company under this Agreement (except to the
extent provided in Section 9 hereof) or to one another hereunder.
8. Increase in Underwriters' Commitments. Subject to Sections 6 and 7
hereof, if any Underwriter shall default in its obligation to take up and pay
for the Firm Shares to be purchased by it hereunder (otherwise than for a
failure of a condition set forth in Section 6 hereof or a reason sufficient to
justify the termination of this Agreement under the provisions of Section 7
hereof) and if the number of Firm Shares which all Underwriters so defaulting
shall have agreed but failed to take up and pay for does not exceed 10% of the
total number of Firm Shares, the non-defaulting Underwriters shall take up and
pay for (in addition to the aggregate number of Firm Shares they are obligated
to purchase pursuant to Section 1 hereof) the number of Firm Shares agreed to be
purchased by all such defaulting Underwriters, as hereinafter provided. Such
Shares shall be taken up and paid for by such non-defaulting Underwriters in
such amount or amounts as you may designate with the consent of each Underwriter
so designated or, in the event no such designation is made, such Shares shall be
taken up and paid for by all non-defaulting Underwriters pro rata in proportion
to the aggregate number of Firm Shares set forth opposite the names of such
non-defaulting Underwriters in Schedule A.
Without relieving any defaulting Underwriter from its obligations
hereunder, the Company agrees with the non-defaulting Underwriters that it will
not sell any Firm Shares hereunder unless all of the Firm Shares are purchased
by the Underwriters (or by substituted Underwriters selected by you with the
approval of the Company or selected by the Company with your approval).
If a new Underwriter or Underwriters are substituted by the Underwriters
or by the Company for a defaulting Underwriter or Underwriters in accordance
with the foregoing provision, the Company or you shall have the right to
postpone the time of purchase for a period not exceeding five business days in
order that any necessary changes in the Registration Statement and the
Prospectus and other documents may be effected.
The term "Underwriter" as used in this Agreement shall refer to and
include any
- 20 -
Underwriter substituted under this Section 8 with like effect as if such
substituted Underwriter had originally been named in Schedule A hereto.
If the aggregate number of Firm Shares which the defaulting Underwriter or
Underwriters agreed to purchase exceeds 10% of the total number of Firm Shares
which all Underwriters agreed to purchase hereunder, and if neither the
non-defaulting Underwriters nor the Company shall make arrangements within the
five business day period stated above for the purchase of all the Firm Shares
which the defaulting Underwriter or Underwriters agreed to purchase hereunder,
this Agreement shall terminate without further act or deed and without any
liability on the part of the Company to any non-defaulting Underwriter and
without any liability on the part of any non-defaulting Underwriter to the
Company. Nothing in this paragraph, and no action taken hereunder, shall relieve
any defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
9. Indemnity and Contribution.
(a) The Company agrees to indemnify, defend and hold harmless each
Underwriter, its partners, directors and officers, and any person who
controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and the successors and assigns of all of
the foregoing persons, from and against any loss, damage, expense,
liability or claim (including the reasonable cost of investigation) which,
jointly or severally, any such Underwriter or any such person may incur
under the Act, the Exchange Act, the common law or otherwise, insofar as
such loss, damage, expense, liability or claim arises out of or is based
upon (i) any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or in the Registration
Statement as amended by any post-effective amendment thereof by the
Company) or in a Prospectus (the term Prospectus for the purpose of this
Section 9 being deemed to include any Preliminary Prospectus and the
Prospectus, as any of the foregoing may be amended or supplemented by the
Company), or arises out of or is based upon any omission or alleged
omission to state a material fact required to be stated in either such
Registration Statement or such Prospectus or necessary to make the
statements made therein not misleading, except insofar as any such loss,
damage, expense, liability or claim arises out of or is based upon any
untrue statement or alleged untrue statement of a material fact contained
in, and in conformity with information concerning such Underwriter
furnished in writing by or on behalf of such Underwriter through you to
the Company expressly for use in, such Registration Statement or such
Prospectus or arises out of or is based upon any omission or alleged
omission to state a material fact in connection with such information
required to be stated in such Registration Statement or such Prospectus or
necessary to make such information not misleading, (ii) any untrue
statement or alleged untrue statement made by the Company in Section 3
hereof or the failure by the Company to perform when and as required any
agreement or covenant contained herein or (iii) any untrue statement or
alleged untrue statement of any material fact contained in any audio or
visual materials provided by the Company or based upon written information
furnished by the Company in connection with the marketing of the Shares,
including, without limitation, slides, videos, films or tape recordings
used in connection with the marketing of the Shares.
- 21 -
If any action, suit or proceeding (each, a "Proceeding") is brought
against an Underwriter or any such person in respect of which indemnity may be
sought against the Company pursuant to the foregoing paragraph, such Underwriter
or such person shall promptly notify the Company in writing of the institution
of such Proceeding and the Company shall assume the defense of such Proceeding,
including the employment of counsel reasonably satisfactory to such indemnified
party and payment of all fees and expenses; provided, however, that the omission
to so notify the Company shall not relieve the Company from any liability which
the Company may have to any Underwriter or any such person or otherwise unless
the Company was unaware of the proceeding to which such notice would have
related and was materially prejudiced by the failure to give such notice. Such
Underwriter or such person shall have the right to employ its or their own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of such Underwriter or of such person unless the employment of such
counsel shall have been authorized in writing by the Company in connection with
the defense of such Proceeding or the Company shall not have, within a
reasonable period of time in light of the circumstances, employed counsel to
have charge of the defense of such Proceeding or such indemnified party or
parties shall have reasonably concluded that there may be defenses available to
it or them which are different from, additional to or in conflict with those
available to the Company (in which case the Company shall not have the right to
direct the defense of such Proceeding on behalf of the indemnified party or
parties), in any of which events such reasonable fees and expenses shall be
borne by the Company and paid as incurred (it being understood, however, that
the Company shall not be liable for the expenses of more than one separate
counsel (in addition to any local counsel) in any one Proceeding or series of
related Proceedings in the same jurisdiction representing the indemnified
parties who are parties to such Proceeding). The Company shall not be liable for
any settlement of any Proceeding effected without its written consent but, if
settled with the written consent of the Company, the Company agrees to indemnify
and hold harmless any Underwriter and any such person from and against any loss
or liability by reason of such settlement. Notwithstanding the foregoing
sentence, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel as contemplated by the second sentence of this paragraph, then the
indemnifying party agrees that it shall be liable for any settlement of any
Proceeding effected without its written consent if (i) such settlement is
entered into more than 60 business days after receipt by such indemnifying party
of the aforesaid request, (ii) such indemnifying party shall not have fully
reimbursed the indemnified party in accordance with such request prior to the
date of such settlement and (iii) such indemnified party shall have given the
indemnifying party at least 30 days' prior notice of its intention to settle.
Any payments made by an indemnifying party shall be without prejudice to such
party's right to dispute its indemnification obligations hereunder. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened Proceeding in respect
of which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all liability
on claims that are the subject matter of such Proceeding and does not include an
admission of fault, culpability or a failure to act, by or on behalf of such
indemnified
- 22 -
party.
(b) Each Underwriter severally agrees to indemnify, defend and hold
harmless the Company, its directors and officers, and any person who controls
the Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, and the successors and assigns of all of the foregoing persons,
from and against any loss, damage, expense, liability or claim (including the
reasonable cost of investigation) which, jointly or severally, the Company or
any such person may incur under the Act, the Exchange Act, the common law or
otherwise, insofar as such loss, damage, expense, liability or claim arises out
of or is based upon any untrue statement or alleged untrue statement of a
material fact contained in, and in conformity with information concerning such
Underwriter furnished in writing by or on behalf of such Underwriter through you
to the Company expressly for use in, the Registration Statement (or in the
Registration Statement as amended by any post-effective amendment thereof by the
Company) or in a Prospectus, or arises out of or is based upon any omission or
alleged omission to state a material fact in connection with such information
required to be stated in such Registration Statement or such Prospectus or
necessary to make such information not misleading.
If any Proceeding is brought against the Company or any such person in
respect of which indemnity may be sought against any Underwriter pursuant to the
foregoing paragraph, the Company or such person shall promptly notify such
Underwriter in writing of the institution of such Proceeding and such
Underwriter shall assume the defense of such Proceeding, including the
employment of counsel reasonably satisfactory to such indemnified party and
payment of all fees and expenses; provided, however, that the omission to so
notify such Underwriter shall not relieve such Underwriter from any liability
which such Underwriter may have to the Company or any such person or otherwise
unless such Underwriter was unaware of the proceeding to which such notice would
have related and was materially prejudiced by the failure to give such notice.
The Company or such person shall have the right to employ its own counsel in any
such case, but the fees and expenses of such counsel shall be at the expense of
the Company or such person unless the employment of such counsel shall have been
authorized in writing by such Underwriter in connection with the defense of such
Proceeding or such Underwriter shall not have, within a reasonable period of
time in light of the circumstances, employed counsel to defend such Proceeding
or such indemnified party or parties shall have reasonably concluded that there
may be defenses available to it or them which are different from or additional
to or in conflict with those available to such Underwriter (in which case such
Underwriter shall not have the right to direct the defense of such Proceeding on
behalf of the indemnified party or parties, but such Underwriter may employ
counsel and participate in the defense thereof but the fees and expenses of such
counsel shall be at the expense of such Underwriter), in any of which events
such reasonable fees and expenses shall be borne by such Underwriter and paid as
incurred (it being understood, however, that such Underwriter shall not be
liable for the expenses of more than one separate counsel (in addition to any
local counsel) in any one Proceeding or series of related Proceedings in the
same jurisdiction representing the indemnified parties who are parties to such
Proceeding). No Underwriter shall be liable for any settlement of any such
Proceeding effected without the written consent of such
- 23 -
Underwriter but, if settled with the written consent of such Underwriter, such
Underwriter agrees to indemnify and hold harmless the Company and any such
person from and against any loss or liability by reason of such settlement.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by the second sentence of this
paragraph, then the indemnifying party agrees that it shall be liable for any
settlement of any Proceeding effected without its written consent if (i) such
settlement is entered into more than 60 business days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
not have reimbursed the indemnified party in accordance with such request prior
to the date of such settlement and (iii) such indemnified party shall have given
the indemnifying party at least 30 days' prior notice of its intention to
settle. Any payments made by an indemnifying party shall be without prejudice to
such party's right to dispute its indemnification obligations hereunder. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened Proceeding in respect
of which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all liability
on claims that are the subject matter of such Proceeding.
(c) If the indemnification provided for in this Section 9 is unavailable
to an indemnified party under subsections (a) and (b)of this Section 10 or
insufficient to hold an indemnified party harmless in respect of any losses,
damages, expenses, liabilities or claims referred to therein, then each
applicable indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, damages, expenses,
liabilities or claims (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriters
on the other hand from the offering of the Shares or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company on the one
hand and of the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, damages, expenses, liabilities or
claims, as well as any other relevant equitable considerations. The relative
benefits received by the Company on the one hand and the Underwriters on the
other shall be deemed to be in the same respective proportions as the total
proceeds from the offering (net of underwriting discounts and commissions but
before deducting expenses) received by the Company, and the total underwriting
discounts and commissions received by the Underwriters, bear to the aggregate
public offering price of the Shares. The relative fault of the Company on the
one hand and of the Underwriters on the other shall be determined by reference
to, among other things, whether the untrue statement or alleged untrue statement
of a material fact or omission or alleged omission relates to information
supplied by the Company or by the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The amount paid or payable by a party as a result of the
losses, damages, expenses, liabilities and claims referred to in this subsection
shall be deemed to include any legal or other fees or expenses reasonably
incurred by such party in connection with investigating, preparing to defend or
defending any Proceeding.
- 24 -
(d) The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 9 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 that does not take account of the
equitable considerations referred to in subsection (c) above. Notwithstanding
the provisions of this Section 9, no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the Shares
underwritten by such Underwriter and distributed to the public were offered to
the public exceeds the amount of any damage which such Underwriter has otherwise
been required to pay by reason of such untrue statement or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to this
Section 10 are several in proportion to their respective underwriting
commitments and not joint.
(e) The indemnity and contribution agreements contained in this Section 10
and the covenants, warranties and representations of the Company contained in
this Agreement shall remain in full force and effect regardless of any
investigation made by or on behalf of any Underwriter, its partners, directors
or officers or any person (including each partner, officer or director of such
person) who controls any Underwriter within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act, or by or on behalf of the Company, its
directors or officers or any person who controls the Company within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act, and shall survive
any termination of this Agreement or the issuance and delivery of the Shares.
The Company and each Underwriter agree promptly to notify each other of the
commencement of any Proceeding against it and, in the case of the Company,
against any of the Company's officers or directors in connection with the
issuance and sale of the Shares, or in connection with the Registration
Statement or the Prospectus.
10. Information Furnished by the Underwriters. The statements set forth
under the headings "Commissions and Discounts" and "Price Stabilization, Short
Positions" under the caption "Underwriting" in the Prospectus, only insofar as
such statements relate to the amount of selling concession and reallowance or to
over-allotment and stabilization activities that may be undertaken by the
Underwriters, constitute the only information furnished by or on behalf of the
Underwriters as such information is referred to in Sections 3 and 9 hereof.
11. Notices. Except as otherwise herein provided, all statements,
requests, notices and agreements shall be in writing or by telegram and, if to
the Underwriters, shall be sufficient in all respects if delivered or sent to
UBS Securities LLC, 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000-0000, Attention:
Syndicate Department and, if to the Company, shall be sufficient in all respects
if delivered or sent to the Company at the offices of the Company at 000
Xxxxxxxxx Xxxxx, Xxxxxxxxx, XX 00000-0000, Attention: Chief Executive Officer.
12. Governing Law; Construction. This Agreement and any claim,
counterclaim or dispute of any kind or nature whatsoever arising out of or in
any way relating to this Agreement ("Claim"), directly or indirectly, shall be
governed by, and construed in accordance with, the laws of the State of New
York. The section headings in this Agreement
- 25 -
have been inserted as a matter of convenience of reference and are not a part of
this Agreement.
13. Submission to Jurisdiction. Except as set forth below, no Claim may be
commenced, prosecuted or continued in any court other than the courts of the
State of New York located in the City and County of New York or in the United
States District Court for the Southern District of New York, which courts shall
have jurisdiction over the adjudication of such matters, and the Company
consents to the jurisdiction of such courts and personal service with respect
thereto. The Company hereby consents to personal jurisdiction, service and venue
in any court in which any Claim arising out of or in any way relating to this
Agreement is brought by any third party against UBS or any indemnified party.
Each of UBS and the Company (on its behalf and, to the extent permitted by
applicable law, on behalf of its stockholders and affiliates) waives all right
to trial by jury in any action, proceeding or counterclaim (whether based upon
contract, tort or otherwise) in any way arising out of or relating to this
Agreement. The Company agrees that a final judgment in any such action,
proceeding or counterclaim brought in any such court shall be conclusive and
binding upon the Company and may be enforced in any other courts to the
jurisdiction of which the Company is or may be subject, by suit upon such
judgment.
14. Parties at Interest. The Agreement herein set forth has been and is
made solely for the benefit of the Underwriters and the Company and to the
extent provided in Section 9 hereof the controlling persons, partners, directors
and officers referred to in such Section, and their respective successors,
assigns, heirs, personal representatives and executors and administrators. No
other person, partnership, association or corporation (including a purchaser, as
such purchaser, from any of the Underwriters) shall acquire or have any right
under or by virtue of this Agreement.
15. Counterparts. This Agreement may be signed by the parties in one or
more counterparts which together shall constitute one and the same agreement
among the parties.
16. Successors and Assigns. This Agreement shall be binding upon the
Underwriters and the Company and their successors and assigns and any successor
or assign of any substantial portion of the Company's and any of the
Underwriters' respective businesses and/or assets.
17. Miscellaneous. UBS, an indirect, wholly owned subsidiary of UBS AG, is
not a bank and is separate from any affiliated bank, including any U.S. branch
or agency of UBS AG. Because UBS is a separately incorporated entity, it is
solely responsible for its own contractual obligations and commitments,
including obligations with respect to sales and purchases of securities.
Securities sold, offered or recommended by UBS are not deposits, are not insured
by the Federal Deposit Insurance Corporation, are not guaranteed by a branch or
agency, and are not otherwise an obligation or responsibility of a branch or
agency.
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- 26 -
If the foregoing correctly sets forth the understanding between the
Company and the several Underwriters, please so indicate in the space provided
below for that purpose, whereupon this agreement and your acceptance shall
constitute a binding agreement between the Company and the Underwriters,
severally.
Very truly yours,
Cepheid
By:
--------------------------------
Name:
Title:
Accepted and agreed to as of the date first above
written, on behalf of themselves and the other several
Underwriters named in Schedule A
UBS Securities LLC
Xxxxxxx Xxxxx & Company, L.L.C.
C.E. Unterberg, Xxxxxx
Xxxxxx & Xxxxxxx, LLC
as Managing Underwriters
By: UBS Securities LLC
By:
-------------------------------
Name:
Title:
By:
-------------------------------
Name:
Title:
SCHEDULE A
Underwriter Number of
Firm Shares
-----------
UBS SECURITIES LLC.............................................
XXXXXXX XXXXX & COMPANY, L.L.C. ...............................
X.X. XXXXXXXXX, TOWBIN ........................................
XXXXXX & XXXXXXX, LLC .........................................
Total....................................................... 5,000,000
