EXHIBIT 1.1
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NXSTAGE MEDICAL, INC.
(a Delaware corporation)
-- Shares of Common Stock
UNDERWRITING AGREEMENT
Dated: --, 2005
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NXSTAGE MEDICAL, INC.
(a Delaware corporation)
-- Shares of Common Stock
(Par Value $0.001 Per Share)
UNDERWRITING AGREEMENT
--, 2005
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxxx Xxxxxx Partners LLC
Xxxxxxx Xxxxx & Company, L.L.C.
JMP Securities LLC
as Representatives of the several Underwriters
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
NxStage Medical, Inc., a Delaware corporation (the "Company"), confirms
its agreement with Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated ("Xxxxxxx Xxxxx") and each of the other Underwriters named in
Schedule A hereto (collectively, the "Underwriters", which term shall also
include any underwriter substituted as hereinafter provided in Section 10
hereof), for whom Xxxxxxx Xxxxx, Xxxxxx Xxxxxx Partners LLC, Xxxxxxx Xxxxx &
Company L.L.C. and JMP Securities LLC are acting as representatives (in such
capacity, the "Representatives"), with respect to the issue and sale by the
Company and the purchase by the Underwriters, acting severally and not jointly,
of the respective numbers of shares of Common Stock, par value $-- per share, of
the Company ("Common Stock") set forth in said Schedule A, and with respect to
the grant by the Company to the Underwriters, acting severally and not jointly,
of the option described in Section 2(b) hereof to purchase all or any part of --
additional shares of Common Stock to cover overallotments, if any. The aforesaid
-- shares of Common Stock (the "Initial Securities") to be purchased by the
Underwriters and all or any part of the -- shares of Common Stock subject to the
option described in Section 2(b) hereof (the "Option Securities") are
hereinafter called, collectively, the "Securities".
The Company understands that the Underwriters propose to make a public
offering of the Securities as soon as the Representatives deem advisable after
this Agreement has been executed and delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-126711, including
the related preliminary prospectus, or prospectuses, covering the registration
of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"). Promptly after execution and delivery of this Agreement, the
Company will prepare and file a prospectus in accordance with the provisions of
Rule 430A ("Rule 430A") of the rules and regulations of the Commission under the
1933 Act (the "1933 Act Regulations") and paragraph (b) of Rule 424 ("Rule
424(b)") of the 1933 Act Regulations. The information included in such
prospectus that was omitted from such registration statement at the time it
became effective but that is deemed to be part of such registration statement at
the time it became effective pursuant to paragraph (b) of Rule 430A is referred
to as "Rule 430A Information." Each prospectus used before such registration
statement became effective, and any prospectus that omitted the Rule 430A
Information, that was used after such effectiveness and prior to the execution
and delivery of this Agreement, is herein called a "preliminary prospectus."
Such registration statement, including the exhibits and any schedules thereto,
at the time it became effective, and including the Rule 430A Information, is
herein called the "Registration Statement." Any registration statement filed
pursuant to Rule 462(b) of the 1933 Act Regulations is herein referred to as the
"Rule 462(b) Registration Statement," and after such filing the term
"Registration Statement" shall include the Rule 462(b) Registration Statement.
The final prospectus in the form first furnished to the Underwriters for use in
connection with the offering of the Securities is herein called the
"Prospectus." For purposes of this Agreement, all references to the Registration
Statement, any preliminary prospectus, the Prospectus or any amendment or
supplement to any of the foregoing shall be deemed to include the copy filed
with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system ("XXXXX").
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company represents
and warrants to each Underwriter as of the date hereof, as of the Closing Time
referred to in Section 2(c) hereof, and as of each Date of Delivery (if any)
referred to in Section 2(b), hereof and agrees with each Underwriter, as
follows:
(i) Compliance with Registration Requirements. Each of the
Registration Statement, any Rule 462(b) Registration Statement and any
post-effective amendment thereto has become effective under the 1933 Act
and no stop order suspending the effectiveness of the Registration
Statement, any Rule 462(b) Registration Statement or any post-effective
amendment thereto has been issued under the 1933 Act and no proceedings
for that purpose have been instituted or are pending or, to the knowledge
of the Company, are contemplated by the Commission, and any request on the
part of the Commission for additional information has been complied with.
At the respective times the Registration Statement and any
post-effective amendments thereto became effective and at the Closing Time
(and, if any Option Securities are purchased, at the Date of Delivery),
the Registration Statement and any amendments and supplements thereto
complied and will comply in all material respects with the requirements of
the 1933 Act and the 1933 Act Regulations 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 not
misleading, and the Prospectus, any preliminary prospectus and any
supplement thereto or prospectus wrapper prepared in connection therewith,
at their respective times of issuance and at the Closing Time, complied
and will comply in all material respects with any applicable laws or
regulations of foreign jurisdictions in which the Prospectus and such
preliminary prospectus, as amended or supplemented, if applicable, are
distributed in connection with the offer and sale of Reserved Securities.
Neither the Prospectus nor any amendments or supplements thereto
(including any prospectus wrapper), at the time the Prospectus or any
amendments or supplements thereto were issued and at the Closing Time
(and, if any Option Securities are purchased, at the Date of Delivery),
included or will include an untrue statement of a material fact
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or omitted or will omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading. The representations and warranties in this
subsection shall not apply to statements in or omissions from the
Registration Statement or the Prospectus made in reliance upon and in
conformity with written information furnished to the Company by any
Underwriter through any of the Representatives expressly for use in the
Registration Statement (or any amendment thereto) or the Prospectus (or
any amendment or supplement thereto).
Each preliminary prospectus and the prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectus delivered
to the Underwriters for use in connection with this offering was identical
to the electronically transmitted copies thereof filed with the Commission
pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(ii) Independent Accountants. Ernst & Young LLP, the accountants who
certified the financial statements and the supporting schedules, if any,
included in the Registration Statement are registered independent public
accountants as required by the 1933 Act and the 1933 Act Regulations.
(iii) Financial Statements. The financial statements included in the
Registration Statement and the Prospectus, together with the related
schedules and notes, present fairly, in all material respects the
financial position of the Company and its consolidated Subsidiary (as
defined below) at the dates indicated and the statement of operations,
stockholders' equity and cash flows of the Company and its consolidated
subsidiaries for the periods specified; said financial statements have
been prepared in conformity with generally accepted accounting principles
("GAAP") applied on a consistent basis throughout the periods involved.
The selected financial data and the summary financial information included
in the Prospectus present fairly [in all material respects], the
information shown therein and have been compiled on a basis consistent
with that of the audited financial statements included in the Registration
Statement. The pro forma financial statements and the related notes
thereto included in the Registration Statement and the Prospectus present
fairly in all material respects the information shown therein, have been
prepared in accordance with the Commission's rules and guidelines with
respect to pro forma financial statements and have been properly compiled
on the bases described therein, and the assumptions used in the
preparation thereof are reasonable and the adjustments used therein are
appropriate to give effect to the transactions and circumstances referred
to therein.
(iv) No Material Adverse Change in Business. Since the respective
dates as of which information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein, (A) there has not been
any material adverse change or any development involving a prospective
material adverse change, in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of the Company and
EIR Medical, Inc., a Massachusetts corporation (the "Subsidiary")
considered as one enterprise, whether or not arising in the ordinary
course of business (a "Material Adverse Effect"), (B) there have been no
transactions entered into by the Company or the Subsidiary, other than
those in the ordinary course of business, which are material with respect
to the Company and the Subsidiary considered as one enterprise, and (C)
there has been no dividend or distribution of any kind declared, paid or
made by the Company on any class of its capital stock.
(v) Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation in good standing under
the laws of the State of Delaware and has
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corporate power and authority to own, lease and operate its properties and
to conduct its business as described in the Prospectus and to enter into
and perform its obligations under this Agreement; and the Company is duly
qualified as a foreign corporation to transact business and is in good
standing in each other jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in
good standing would not reasonably be expected to result in a Material
Adverse Effect. The Company is qualified as a foreign corporation to
transact business in the Commonwealth of Massachusetts.
(vi) Good Standing of Subsidiaries. The Subsidiary has been duly
organized and is validly existing as a corporation in good standing under
the laws of the jurisdiction of its incorporation, has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus and is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except
where the failure so to qualify or to be in good standing would not
reasonably be expected to result in a Material Adverse Effect; except as
otherwise disclosed in the Registration Statement, all of the issued and
outstanding capital stock of the Subsidiary has been duly authorized and
validly issued, is fully paid and non-assessable and is owned by the
Company, directly or through the Subsidiary, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity;
none of the outstanding shares of capital stock of the Subsidiary was
issued in violation of the preemptive or similar rights of any
securityholder of the Subsidiary. The only subsidiary of the Company is
listed on Exhibit 21.1 to the Registration Statement.
(vii) Capitalization. The authorized, issued and outstanding capital
stock of the Company is as set forth in the Prospectus in the column
entitled "Pro Forma" under the caption "Capitalization" (except for
issuances subsequent to June 30, 2005, if any, pursuant to this Agreement,
pursuant to reservations, agreements or employee benefit plans referred to
in the Prospectus or pursuant to the exercise of convertible securities or
options referred to in the Prospectus). The shares of issued and
outstanding capital stock of the Company have been duly authorized and
validly issued and are fully paid and non-assessable; none of the
outstanding shares of capital stock of the Company was issued in violation
of the preemptive or other similar rights of any securityholder of the
Company.
(viii) Authorization of Agreement. This Agreement has been duly
authorized, executed and delivered by the Company.
(ix) Authorization and Description of Securities. The Securities to
be purchased by the Underwriters from the Company have been duly
authorized for issuance and sale to the Underwriters pursuant to this
Agreement and, when issued and delivered by the Company pursuant to this
Agreement against payment of the consideration set forth herein will be
validly issued, fully paid and non-assessable; the Common Stock conforms
to all statements relating thereto contained in the Prospectus and such
description conforms to the rights set forth in the instruments defining
the same; and the issuance of the Securities is not subject to the
preemptive or other similar rights of any securityholder of the Company.
(x) Absence of Defaults and Conflicts. Neither the Company nor the
Subsidiary is in violation of its charter or by-laws or in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, lease or other agreement or instrument to
which the Company or the Subsidiary is a party or by which it or any of
them may be bound, or to which
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any of the property or assets of the Company or the Subsidiary is subject
(collectively, "Agreements and Instruments") except for such defaults that
would not reasonably be expected to result in a Material Adverse Effect;
and the execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated herein and in the
Registration Statement (including the issuance and sale of the Securities
and the use of the proceeds from the sale of the Securities as described
in the Prospectus under the caption "Use of Proceeds") and compliance by
the Company with its obligations hereunder have been duly authorized by
all necessary corporate action and do not and will not, whether with or
without the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined below)
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or the Subsidiary
pursuant to, the Agreements and Instruments (except for such conflicts,
breaches, defaults or Repayment Events or liens, charges or encumbrances
that would not reasonably be expected to result in a Material Adverse
Effect), nor will such action result in any violation of any applicable
law, statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Company or the Subsidiary or any of their
assets, properties or operations (except for such violations that would
not reasonably be expected to result in a Material Adverse Effect), or the
provisions of the charter or by-laws of the Company or the Subsidiary. As
used herein, a "Repayment Event" means any event or condition which gives
the holder of any note, debenture or other evidence of indebtedness (or
any person acting on such holder's behalf) the right to require the
repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or the Subsidiary.
(xi) Absence of Labor Dispute. No labor dispute with the employees
of the Company or the Subsidiary exists or, to the knowledge of the
Company, is imminent, and the Company is not aware of any existing or
imminent labor disturbance by the employees of any of its or the
Subsidiary's principal suppliers, manufacturers, customers or contractors,
which, in either case, would reasonably be expected to result in a
Material Adverse Effect.
(xii) Absence of Proceedings. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge of
the Company, threatened, against or affecting the Company or the
Subsidiary, which is required to be disclosed in the Registration
Statement (other than as disclosed therein), or which would be reasonably
expected to result in a Material Adverse Effect, or which might materially
and adversely affect the properties or assets thereof or the consummation
of the transactions contemplated herein or the performance by the Company
of its obligations hereunder (other than as disclosed in the Registration
Statement); the aggregate of all pending legal or governmental proceedings
to which the Company or the Subsidiary is a party or of which any of their
respective property or assets is the subject which are not described in
the Registration Statement, including ordinary routine litigation
incidental to the business, would not reasonably be expected to result in
a Material Adverse Effect.
(xiii) Statistical and Market Related Data. The statistical and
market related data included in the Registration Statement are based on or
derived from sources that the Company believes to be reliable and
accurate.
(xiv) Accuracy of Exhibits. There are no contracts or documents
which are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits thereto which have not been so
described and filed as required.
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(xv) Intellectual Property Rights. The Company and the Subsidiary
own, possess or can acquire on reasonable terms sufficient trademarks,
trade names, patent rights, copyrights, domain names, licenses, approvals,
trade secrets, inventions, technology, know-how and other intellectual
property and similar rights, including registrations and applications for
registration thereof as are necessary or material to conduct the business
as now conducted or proposed in the Registration Statement to be conducted
by them, or presently employed by them (collectively, "INTELLECTUAL
PROPERTY RIGHTS"). The expected expiration of any of the Intellectual
Property Rights owned by or licensed to the Company and the Subsidiary
would not, individually or in the aggregate, have a Material Adverse
Effect. The Company or the Subsidiary is the exclusive owner of the entire
and unencumbered right, title and interest to the Intellectual Property
Rights, and the Company or the Subsidiary has a valid right to use the
Intellectual Property Rights in the ordinary course of the business as now
conducted or proposed in the Prospectus to be conducted by the Company and
the Subsidiary. There is no pending or, to the knowledge of the Company
and the Subsidiary, threatened action, suit, proceeding or claim by others
challenging the Company's or the Subsidiary's rights in or to any of the
Intellectual Property Rights owned by or licensed to the Company and the
Subsidiary. To the knowledge of the Company and the Subsidiary there is no
material infringement, misappropriation or other violation by third
parties of any of the Intellectual Property Rights owned by or licensed to
the Company and the Subsidiary. To the knowledge of the Company and the
Subsidiary the Intellectual Property Rights owned by or licensed to the
Company and the Subsidiary are valid and enforceable. To the knowledge of
the Company and the Subsidiary, there is no pending or threatened action,
suit, proceeding or claim by others challenging the validity,
enforceability or scope of any of the Intellectual Property Rights owned
by or licensed to the Company and the Subsidiary. To the knowledge of the
Company and the Subsidiary, the operation of the business as now conducted
or proposed in the Prospectus to be conducted does not conflict with,
infringe, misappropriate or otherwise violate the Intellectual Property
Rights or other proprietary rights of any third party. There is no pending
or, to the knowledge of the Company and the Subsidiary, threatened action,
suit, proceeding or claim by others that the Company or the Subsidiary
infringes, misappropriates or otherwise violates or conflicts with any
Intellectual Property Rights or other proprietary rights of others, the
Company and the Subsidiary have not received any written notice of any
such claim. To the knowledge of the Company and the Subsidiary, no
officer, director or employee of the Company or the Subsidiary is in or
has ever been in violation of any term of any employment contract, patent
disclosure agreement, invention assignment agreement, non-competition
agreement, non-solicitation agreement, nondisclosure agreement or any
restrictive covenant to or with a former employer, where the basis of such
violation relates to such employee's employment with the Company or the
Subsidiary or actions undertaken by the employee while employed with the
Company or the Subsidiary. None of the Intellectual Property Rights used
by the Company or the Subsidiary in its their business as now conducted,
or proposed in the Prospectus to be conducted, has been obtained or is
being used by the Company or the Subsidiary in violation of any
contractual obligation binding on the Company, the Subsidiary, or any of
their officers, directors or employees or otherwise in violation of the
rights of any persons.
(xvi) Patent Applications. The Company and the Subsidiary have duly
and properly filed or caused to be filed with the U. S. Patent and
Trademark Office (the "PTO") or foreign and international patent
authorities all patent applications disclosed in the Prospectus as owned
by the Company and the Subsidiary (the "Company Patent Applications"). To
the knowledge of the Company and the Subsidiary, the Company has complied
with the PTO's duty of candor and disclosure for the Company Patent
Applications and has made no material misrepresentation during prosecution
of the Company Patent Applications. To knowledge of the Company and the
Subsidiary, the Company Patent Applications disclose patentable subject
matters, and the Company has not been notified of any inventorship
challenges nor has any interference been
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declared or provoked nor is any material fact known by the Company and the
Subsidiary that would preclude the issuance of patents with respect to the
Company Patent Applications or would render such patents, if issued,
invalid or unenforceable.
(xvii) Intellectual Property Licenses. The Company and the
Subsidiary have not breached and are not currently in breach of any
provision of any license, contract or other agreement governing the
Company's or the Subsidiary's use of Intellectual Property Rights owned by
third parties (collectively, the "LICENSES"), except for breaches that
would not, individually or in the aggregate, reasonably be expected to
result in a Material Adverse Effect, no third party has alleged any such
breach, and the Company and the Subsidiary are unaware of any facts that
would form a reasonable basis for such a claim. To the knowledge of the
Company and the Subsidiary, no other party to the Licenses has breached or
is currently in breach of any provision of the Licenses, except for
breaches that would not, individually or in the aggregate, reasonably be
expected to result in a Material Adverse Effect. Each of the Licenses is
in full force and effect and constitutes a valid and binding agreement
between the parties thereto, enforceable in accordance with its terms, and
there has not occurred any breach or default under any such Licenses or
any event that with the giving of notice or lapse of time would constitute
a breach or default thereunder, except for breaches or defaults that would
not, individually or in the aggregate, reasonably be expected to result in
a Material Adverse Effect. Except as would not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect,
neither the Company nor the Subsidiary have been or are currently involved
in any disputes regarding the Licenses. To the knowledge of the Company
and the Subsidiary, all Intellectual Property Rights licensed to the
Company and the Subsidiary pursuant to the Licenses are valid, enforceable
and being duly maintained. To knowledge of the Company and the Subsidiary,
all applications for registration of Intellectual Property Rights that are
licensed to the Company or the Subsidiary pursuant to the Licenses are
being duly prosecuted.
(xviii) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Company of its
obligations hereunder, in connection with the offering, issuance or sale
of the Securities hereunder or the consummation by the Company of the
transactions contemplated by this Agreement, except (i) such as have been
already obtained or as may be required under the 1933 Act or the 1933 Act
Regulations and foreign or state securities or blue sky laws.
(xix) Absence of Manipulation. Neither the Company nor, to the
knowledge of the Company, any affiliate of the Company, has taken, nor
will the Company or any affiliate take, directly or indirectly, any action
which is designed to or which has constituted or which would be expected
to cause or result in stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Securities.
(xx) Possession of Licenses and Permits. The Company and the
Subsidiary possess such permits, licenses, approvals, consents and other
authorizations (collectively, "Governmental Licenses") issued by the
appropriate federal, state, local or foreign regulatory agencies or bodies
necessary to conduct the business now operated by them, except where the
failure to possess such Governmental licenses would not, singly or in the
aggregate, reasonably be expected to result in a Material Adverse Effect;
the Company and the Subsidiary are in compliance with the terms and
conditions of all such Governmental Licenses, except where the failure so
to comply would not, singly or in the aggregate, reasonably be expected to
result in a Material Adverse Effect; all of the Governmental Licenses are
valid and in full force and effect, except when the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to be
in full force and effect
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would not, singly or in the aggregate, reasonably be expected to result in
a Material Adverse Effect; and neither the Company nor the Subsidiary has
received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
would reasonably be expected to result in a Material Adverse Effect.
(xxi) Title to Property. The Company and the Subsidiary have good
and marketable title to all real property owned by the Company and the
Subsidiary and good title to all other properties owned by them, in each
case, free and clear of all mortgages, pledges, liens, security interests,
claims, restrictions or encumbrances of any kind except such as (a) are
described in the Registration Statement or (b) do not, singly or in the
aggregate, materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property by
the Company or the Subsidiary; and all of the leases and subleases
material to the business of the Company and the Subsidiary, considered as
one enterprise, and under which the Company or the Subsidiary holds
properties described in the Prospectus, are in full force and effect, and
neither the Company nor the Subsidiary has any notice of any material
claim of any sort that has been asserted by anyone adverse to the rights
of the Company or the Subsidiary under any of the leases or subleases
mentioned above, or affecting or questioning the rights of the Company or
the Subsidiary to the continued possession of the leased or subleased
premises under any such lease or sublease.
(xxii) Investment Company Act. The Company is not required, and upon
the issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the Prospectus
will not be required, to register as an "investment company" under the
Investment Company Act of 1940, as amended (the "1940 Act").
(xxiii) ERISA compliance. No "prohibited transaction" (as defined in
Section 406 of the Employee Retirement Income Security Act of 1974, as
amended from time to time, including the regulations and published
interpretations thereunder ("ERISA"), or Section 4975 of the Internal
Revenue Code of 1986, as amended from time to time (the "Code")) or
"accumulated funding deficiency" (as defined in Section 302 of ERISA) or
any of the reportable events set forth in Section 4043(c) of ERISA (other
than events with respect to which the 30-day notice requirement under
Section 4043 of ERISA has been waived) has occurred with respect to any
employee benefit plan of the Company or the Subsidiary which would
reasonably be expected to have a Material Adverse Effect, each such
employee benefit plan is in compliance with applicable law, including
ERISA and the Code, except where such noncompliance, individually or in
the aggregate, would not reasonably be expected to have a Material Adverse
Effect, the Company and the Subsidiary have not incurred and do not expect
to incur liability under Title IV of ERISA with respect to the termination
of, or withdrawal from, any pension plan for which the Company or the
Subsidiary would reasonably be expected to have any liability that would
have a Material Adverse Effect; and each such pension plan maintained by
the Company or the Subsidiary that is intended to be qualified under
Section 401(a) of the Code is so qualified in all material respects and
nothing has occurred, whether by action or by failure to act, which would
cause the loss of such qualification, in each case, except where any such
failure to qualify or loss of qualification would not reasonably be
expected to have a Material Adverse Effect.
(xxiv) Environmental Laws. Except as described in the Registration
Statement and except as would not, singly or in the aggregate, reasonably
be expected to result in a Material Adverse Effect, (A) neither the
Company nor the Subsidiary is in violation of any federal, state, local or
foreign statute, law, rule, regulation, ordinance, code, policy or rule of
common law or any judicial or administrative interpretation thereof,
including any judicial or administrative
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order, consent, decree or judgment, relating to pollution or protection of
human health, the environment (including, without limitation, ambient air,
surface water, groundwater, land surface or subsurface strata) or
wildlife, including, without limitation, laws and regulations relating to
the release or threatened release of chemicals, pollutants, contaminants,
wastes, toxic substances, hazardous substances, petroleum or petroleum
products, asbestos-containing materials or mold (collectively, "Hazardous
Materials") or to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of Hazardous Materials
(collectively, "Environmental Laws"), (B) the Company and the Subsidiary
have all permits, authorizations and approvals required under any
applicable Environmental Laws and are each in compliance with their
requirements, (C) there are no pending or, to the Company's knowledge,
threatened administrative, regulatory or judicial actions, suits, demands,
demand letters, claims, liens, notices of noncompliance or violation,
investigation or proceedings relating to any Environmental Law against the
Company or the Subsidiary and (D) to the Company's knowledge, there are no
events or circumstances that would reasonably be expected to form the
basis of an order for clean-up or remediation, or an action, suit or
proceeding by any private party or governmental body or agency, against or
affecting the Company or the Subsidiary relating to Hazardous Materials or
any Environmental Laws.
(xxv) Tax Law Compliance. The Company has filed all necessary
federal, state and foreign income and franchise tax returns or has validly
requested extensions thereof (except for any failures to file that would
not individually or in the aggregate reasonably be expected to have a
Material Adverse Effect or as disclosed in the Registration Statement) and
has paid all taxes required to be paid and, if due and payable, any
related or similar assessment, fine or penalty levied against it, except
for any tax or related or similar assessment, fine or penalty that is
currently being contested in good faith through appropriate proceedings or
as would not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect or as disclosed in the Registration
Statement. The Company has made adequate charges, accruals and reserves in
the applicable financial statements referred to in Section l(a)(iii) above
in respect of all federal, state and foreign income and franchise taxes
for all periods as to which the tax liability of the Company has not been
finally determined, except as would not individually or in the aggregate
reasonably be expected to have a Material Adverse Effect or as disclosed
in the Registration Statement. There are no tax audits or investigations
pending, which if adversely determined would individually or in the
aggregate reasonably be expected to result in a Material Adverse Effect,
except as disclosed in the Registration Statement, nor, to the Company's
knowledge, are there any proposed additional tax assessments against the
Company which if adversely determined would individually or in the
aggregate reasonably be expected to result in a Material Adverse Effect,
except as disclosed in the Registration Statement.
(xxvi) Insurance. The Company and the Subsidiary carry, or are
covered by, insurance covering their respective properties, operations,
personnel and businesses which insurance is in such amounts and insures
against such losses and risks as are adequate to protect the Company and
the Subsidiary and their respective businesses. The Company has no reason
to believe that it will not be able (i) to renew its existing insurance
coverage as and when such policies expire or (ii) to obtain comparable
coverage from similar institutions as may be necessary or appropriate to
conduct its business as now conducted and at a cost that would not
reasonably be expected to result in a Material Adverse Effect. The Company
has not been denied any insurance coverage, for which it has applied.
(xxvii) FDA Compliance. Each of the Company and the Subsidiary has
filed with the U.S. Food and Drug Administration (the "FDA") and all other
applicable foreign, state and local regulatory bodies for, and received
approval of, all registrations, applications, licenses, requests
9
for exemptions, permits and other regulatory authorizations material to
the conduct of its business as now conducted, except where such failure to
file or receive approval would not reasonably be expected to have a
Material Adverse Effect; each of the Company and the Subsidiary is in
compliance in all material respects with all such registrations,
applications, licenses, requests for exemptions, permits and other
regulatory authorizations, and all applicable FDA, foreign, state and
local rules and regulations; and the Company has no reason to believe that
any party granting any such registration, application, license, request
for exemption, permit or other authorization is considering limiting,
suspending or revoking the same in any material respect.
(xxviii) Medicare and Medicaid. Except as would not, individually or
in the aggregate, result in a Material Adverse Effect, the Company is in
compliance in all material respects with all applicable laws, statutes,
ordinances, rules or regulations with respect to Medicare and Medicaid
(including, without limitation, all provisions of the Social Security Act
pertaining to Medicare and Medicaid and The False Claims Act).
(xxix) FDA, Medicare, Medicaid and PTO Proceedings. To the best of
the Company's knowledge, except as disclosed in the Registration
Statement, there are no rulemaking or similar proceedings before the FDA,
The Centers for Medicare and Medicare Services or the U.S. Patent and
Trademark Office or any similar entity in any other jurisdiction which
affects or involves, or will affect or involve, the Company or any of the
processes or products which the Prospectus discloses the Company has
developed, is developing or proposes to develop or uses or proposes to use
which, if the subject of an action unfavorable to the Company, would
reasonably be expected to have a Material Adverse Effect upon the Company.
(xxx) No Actions by FDA. Other than as disclosed in the Registration
Statement, the FDA has not commenced, or, to the Company's knowledge,
threatened to initiate, any action to withdraw its approval of any product
of the Company or the Subsidiary or commenced or, to the Company's
knowledge, threatened to initiate any action to withdraw its approval of
any facility of the Company or the Subsidiary.
(xxxi) Clinical and Preclinical Tests. Each of the human clinical
trials and other preclinical tests conducted by the Company or the
Subsidiary, or in which the Company or the Subsidiary has participated,
that are described in the Registration Statement or the Prospectus or the
results of which are referred to in the Registration Statement or the
Prospectus, and such studies and tests conducted on behalf of the Company
or the Subsidiary, were and, if still pending, are being conducted in all
material respects (i) in accordance with experimental protocols,
procedures and controls generally used by qualified experts in the
preclinical or clinical study of products comparable to those developed by
the Company and (ii) for pre-market investigational device exemption
studies, in compliance with all applicable current Good Laboratory and
Good Clinical Practices; the descriptions of the results of such studies,
tests and trials contained in the Registration Statement and the
Prospectus are accurate and complete in all material respects, and the
Company has no knowledge of any other trials, studies or tests, the
results of which reasonably call into question the results described or
referred to in the Registration Statement and the Prospectus; neither the
Company nor the Subsidiary has received any notices or correspondence from
the FDA or any other governmental agency requiring the termination,
suspension or modification (other than such suspensions as have been
lifted or such modifications as have been complied with as disclosed in
the Registration Statement) of preclinical tests or clinical trials
conducted by or on behalf of the Company or the Subsidiary or in which the
Company or the Subsidiary has participated that are described in the
Registration Statement or the Prospectus or the results of which are
referred to in the Registration Statement or the Prospectus.
10
(xxxii) No Violation of FCPA. None of the Company, the Subsidiary
or, to the knowledge of the Company, any director, officer, agent,
employee or affiliate of the Company or the Subsidiary is aware of, or has
taken, any action, directly or indirectly, that would reasonably be
expected to result in a violation by such Persons of Foreign Corrupt
Practices Act of 1977, as amended, and the rules and regulations
thereunder (the "FCPA"), including, without limitation, making use of the
mails or any means or instrumentality of interstate commerce corruptly in
furtherance of an offer, payment, promise to pay or authorization of the
payment of any money, or other property, gift, promise to give, or
authorization of the giving of anything of value to any "foreign official"
(as such term is defined in the FCPA) or any foreign political party or
official thereof or any candidate for foreign political office, in
contravention of the FCPA; and the Company and the Subsidiary have
conducted their businesses in compliance with the FCPA and have instituted
and maintain policies and procedures designed to ensure, and which are
reasonably expected to continue to ensure, continued compliance therewith.
(xxxiii) Registration Rights. Except as otherwise disclosed in the
Registration Statement, there are no persons with registration rights or
other similar rights to have any securities registered pursuant to the
Registration Statement or otherwise registered by the Company under the
1933 Act.
(xxxiv) Compliance with Xxxxxxxx-Xxxxx Act. The Company and the
Subsidiary are, or upon becoming subject to the Exchange Act will be, in
compliance in all material respects with the provisions of the
Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations promulgated in
connection therewith (the "Xxxxxxxx-Xxxxx Act") that are effective and are
applicable to the Company as an "issuer" as defined under the
Xxxxxxxx-Xxxxx Act and to which it is then subject.
(xxxv) Disclosure and Internal Controls. As of the Closing Time, the
Company will have established disclosure controls and procedures (as such
term is defined in Rules 13a-14 and 15d-14 under the 0000 Xxx) that (A)
are designed to ensure that material information relating to the Company
and the Subsidiary is known to the Company's Chief Executive Officer and
its Chief Financial Officer by others within the Company and the
Subsidiary, particularly during the periods in which the filings made by
the Company with the Commission which it may make under the 1934 Act are
being prepared, (B) will be evaluated for effectiveness as of the end of
each fiscal quarter and (C) are effective in all material respects to
perform the functions for which they were established. The Company and the
Subsidiary maintain a system of internal accounting controls sufficient to
provide reasonable assurances that (A) transactions are executed in
accordance with management's general or specific authorization, (B)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with GAAP and to maintain accountability for
assets, (C) access to assets is permitted only in accordance with
management's general or specific authorization and (D) the recorded
accountability for assets is compared in all material respects with the
existing assets at reasonable intervals and appropriate action is taken
with respect to any differences.
(b) Officer's Certificates. Any certificate signed by any officer of the
Company or the Subsidiary delivered to the Representatives or to counsel for the
Underwriters shall be deemed a representation and warranty by the Company to
each Underwriter as to the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Initial Securities. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company agrees to sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase from the
11
Company, at the price per share set forth in Schedule B, the number of Initial
Securities set forth in Schedule A opposite the name of such Underwriter, plus
any additional number of Initial Securities which such Underwriter may become
obligated to purchase pursuant to the provisions of Section 10 hereof.
(b) Option Securities. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the Underwriters, severally
and not jointly, to purchase up to an additional -- shares of Common Stock at
the price per share set forth in Schedule B, less an amount per share equal to
any dividends or distributions declared by the Company and payable on the
Initial Securities but not payable on the Option Securities. The option hereby
granted will expire 30 days after the date hereof and may be exercised in whole
or in part from time to time only for the purpose of covering overallotments
which may be made in connection with the offering and distribution of the
Initial Securities upon notice by Xxxxxxx Xxxxx to the Company setting forth the
number of Option Securities as to which the several Underwriters are then
exercising the option and the time and date of payment and delivery for such
Option Securities. Any such time and date of delivery for the Option Securities
(a "Date of Delivery") shall be determined by Xxxxxxx Xxxxx, but shall not be
later than [five] full business days after the exercise of said option, nor in
any event prior to the Closing Time, as hereinafter defined. If the option is
exercised as to all or any portion of the Option Securities, each of the
Underwriters, acting severally and not jointly, will purchase that proportion of
the total number of Option Securities then being purchased which the number of
Initial Securities set forth in Schedule A opposite the name of such Underwriter
bears to the total number of Initial Securities, subject in each case to such
adjustments as Xxxxxxx Xxxxx in its discretion shall make to eliminate any sales
or purchases of fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of Xxxxxx
Xxxxxx Xxxxxxxxx Xxxx and Xxxx LLP, 00 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx, or
at such other place as shall be agreed upon by the Representatives and the
Company, at 9:00 A.M. (Eastern time) on the third (fourth, if the pricing occurs
after 4:30 P.M. (Eastern time) on any given day) business day after the date
hereof (unless postponed in accordance with the provisions of Section 10), or
such other time not later than ten business days after such date as shall be
agreed upon by the Representatives and the Company (such time and date of
payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the above-mentioned
offices, or at such other place as shall be agreed upon by the Representatives
and the Company, on each Date of Delivery as specified in the notice from the
Representatives to the Company, but not earlier than the third business day
after delivery of such notice.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the Representatives for the respective accounts of the Underwriters of
certificates for the Securities to be purchased by them. It is understood that
each Underwriter has authorized the Representatives, for its account, to accept
delivery of, receipt for, and make payment of the purchase price for, the
Initial Securities and the Option Securities, if any, which it has agreed to
purchase. Xxxxxxx Xxxxx, individually and not as representative of the
Underwriters, may (but shall not be obligated to) make payment of the purchase
price for the Initial Securities or the Option Securities, if any, to be
purchased by any Underwriter whose funds have not been received by the Closing
Time or the relevant Date of Delivery, as the case may be, but such payment
shall not relieve such Underwriter from its obligations hereunder.
(d) Denominations; Registration. Certificates for the Initial Securities
and the Option Securities, if any, shall be in such denominations and registered
in such names as the Representatives may
12
request in writing at least one full business day before the Closing Time or the
relevant Date of Delivery, as the case may be. The certificates for the Initial
Securities and the Option Securities, if any, will be made available for
examination and packaging by the Representatives in The City of New York not
later than 10:00 A.M. (Eastern time) on the business day prior to the Closing
Time or the relevant Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company covenants with each
Underwriter as follows:
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 3(b), will comply with the requirements of Rule 430A
or Rule 434, as applicable, and will notify the Representatives immediately, and
confirm the notice in writing, (i) when any post-effective amendment to the
Registration Statement shall become effective, or any supplement to the
Prospectus or any amended Prospectus shall have been filed, (ii) of the receipt
of any comments from the Commission, (iii) of any request by the Commission for
any amendment to the Registration Statement or any amendment or supplement to
the Prospectus or for additional information, and (iv) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or of any order preventing or suspending the use of any preliminary
prospectus, or of the suspension of the qualification of the Securities for
offering or sale in any jurisdiction, or of the initiation or threatening of any
proceedings for any of such purposes. The Company will promptly effect the
filings necessary pursuant to Rule 424(b) and will take such steps as it deems
necessary to ascertain promptly whether the form of prospectus transmitted for
filing under Rule 424(b) was received for filing by the Commission and, in the
event that it was not, it will promptly file such prospectus. The Company will
make every reasonable effort to prevent the issuance of any stop order and, if
any stop order is issued, to obtain the lifting thereof at the earliest possible
moment.
(b) Filing of Amendments. The Company will give the Representatives notice
of its intention to file or prepare any amendment to the Registration Statement
(including any filing under Rule 462(b)) or any amendment, supplement or
revision to either the prospectus included in the Registration Statement at the
time it became effective or to the Prospectus, will furnish the Representatives
with copies of any such documents a reasonable amount of time prior to such
proposed filing or use, as the case may be, and will not file or use any such
document to which the Representatives or counsel for the Underwriters shall
reasonably object.
(c) Delivery of Registration Statements. The Company has furnished or will
deliver to the Representatives and counsel for the Underwriters, without charge,
four signed copies of the Registration Statement as originally filed and of each
amendment thereto (including exhibits filed therewith or incorporated by
reference therein) and copies of all consents and certificates of experts, and
will also deliver to the Representatives, without charge, a conformed copy of
the Registration Statement as originally filed and of each amendment thereto
(without exhibits) for each of the Underwriters. The copies of the Registration
Statement and each amendment thereto furnished to the Underwriters will be
identical to the electronically transmitted copies thereof filed with the
Commission pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered to each
Underwriter, without charge, as many copies of each preliminary prospectus as
such Underwriter reasonably requested, and the Company hereby consents to the
use of such copies for purposes permitted by the 1933 Act. The Company will
furnish to each Underwriter, without charge, during the period when the
Prospectus is required to be delivered under the 1933 Act, such number of copies
of the Prospectus (as amended or supplemented) as such Underwriter may
reasonably request. The Prospectus and any amendments or
13
supplements thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the 1933 Act and the 1933 Act Regulations so as to permit the completion of
the distribution of the Securities as contemplated in this Agreement and in the
Prospectus. If at any time when a prospectus is required by the 1933 Act to be
delivered in connection with sales of the Securities, any event shall occur or
condition shall exist as a result of which it is necessary, in the reasonable
opinion of counsel for the Underwriters or for the Company, to amend the
Registration Statement or amend or supplement the Prospectus in order that the
Prospectus will not include any untrue statements of a material fact or omit to
state a material fact necessary in order to make the statements therein not
misleading in the light of the circumstances existing at the time it is
delivered to a purchaser, or if it shall be necessary, in the reasonable opinion
of such counsel, at any such time to amend the Registration Statement or amend
or supplement the Prospectus in order to comply with the requirements of the
1933 Act or the 1933 Act Regulations, the Company will promptly prepare and file
with the Commission, subject to Section 3(b), such amendment or supplement as
may be necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such requirements, and the
Company will furnish to the Underwriters such number of copies of such amendment
or supplement as the Underwriters may reasonably request.
(f) Blue Sky Qualifications. The Company will use its best efforts, in
cooperation with the Underwriters, to qualify the Securities for offering and
sale under the applicable securities laws of such states and other jurisdictions
(domestic or foreign) as the Representatives may designate and to maintain such
qualifications in effect for a period of not less than one year from the later
of the effective date of the Registration Statement and any Rule 462(b)
Registration Statement; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject.
(g) Rule 158. The Company will timely file such reports pursuant to the
Securities Exchange Act of 1934 (the "1934 Act") as are necessary in order to
make generally available to its securityholders as soon as practicable an
earnings statement for the purposes of, and to provide the benefits contemplated
by, the last paragraph of Section 11(a) of the 1933 Act.
(h) Use of Proceeds. The Company intends to use the net proceeds received
by it from the sale of the Securities in the manner specified in the Prospectus
under "Use of Proceeds".
(i) Listing. The Company will use its best efforts to effect and maintain
the quotation of the Securities on the Nasdaq National Market.
(j) Restriction on Sale of Securities. During a period of 180 days from
the date of the Prospectus, the Company will not, without the prior written
consent of Xxxxxxx Xxxxx, (i) directly or indirectly, offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant to purchase or otherwise
transfer or dispose of any share of Common Stock or any securities convertible
into or exercisable or exchangeable for Common Stock or file any registration
statement under the 1933 Act with respect to any of the foregoing or (ii) enter
into any swap or any other agreement or any transaction that transfers, in whole
or in part, directly or indirectly, the economic consequence of ownership of the
Common Stock, whether any such swap or transaction described in clause (i) or
(ii) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. The foregoing sentence shall not apply to (A)
the Securities to be sold hereunder, (B) any shares of Common Stock issued by
the Company upon the exercise of an option or warrant or the conversion of a
security outstanding on the date hereof and referred to in the Registration
14
Statement, (C) any shares of Common Stock issued or options to purchase Common
Stock granted pursuant to existing employee benefit plans of the Company
referred to in the Registration Statement, (D) any shares of Common Stock issued
pursuant to any non-employee director stock plan or dividend reinvestment plan
or (E) any shares of Common Stock issued by the Company to acquire any assets or
equity of one or more businesses, provided that such shares are subject in
writing to the restrictions on transfer set forth herein.
(k) Reporting Requirements. The Company, during the period when the Prospectus
is required to be delivered under the 1933 Act, will file all documents required
to be filed with the Commission pursuant to the 1934 Act within the time periods
required by the 1934 Act and the rules and regulations of the Commission
thereunder.
SECTION 4. Payment of Expenses.
(a) Expenses. Except as otherwise set forth herein, the Company will pay
all expenses incident to the performance of its obligations under this
Agreement, including (i) the preparation, printing and filing of the
Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment thereto, (ii) the preparation, printing
and delivery to the Underwriters of this Agreement, any Agreement among
Underwriters and such other documents as may be required in connection with the
offering, purchase, sale, issuance or delivery of the Securities, (iii) the
preparation, issuance and delivery of the certificates for the Securities to the
Underwriters, including any stock or other transfer taxes and any stamp or other
duties payable upon the sale, issuance or delivery of the Securities to the
Underwriters, (iv) the fees and disbursements of the Company's counsel,
accountants and other advisors, (v) the qualification of the Securities under
securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey and any supplement thereto (provided that all such fees
and disbursements shall not exceed $20,000), (vi) the printing and delivery to
the Underwriters of copies of each preliminary prospectus, and of the Prospectus
and any amendments or supplements thereto, (vii) the preparation, printing and
delivery to the Underwriters of copies of the Blue Sky Survey and any supplement
thereto, (viii) the fees and expenses of any transfer agent or registrar for the
Securities, (ix) the costs and expenses of the Company relating to investor
presentations on any "road show" undertaken in connection with the marketing of
the Securities, including without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any
consultants engaged with the consent of the Company in connection with the road
show presentations, travel and lodging expenses of the representatives and
officers of the Company and any such consultants with the consent of the
Company; provided, however, that, one half of the cost of aircraft and other
transportation chartered in connection with the road show shall be borne by the
Underwriters and (x) the filing fees incident to, and the reasonable fees and
disbursements of counsel to the Underwriters in connection with, the review by
the National Association of Securities Dealers, Inc. (the "NASD") of the terms
of the sale of the Securities and (xi) the fees and expenses incurred in
connection with the inclusion of the Securities in the Nasdaq National Market.
(b) Termination of Agreement. If this Agreement is terminated by the
Representatives in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the Company shall reimburse the Underwriters for all of their
reasonable out-of-pocket expenses, including the reasonable fees and
disbursements of counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of the
several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company contained in Section 1 hereof or
in certificates of any officer of the Company or the Subsidiary delivered
15
pursuant to the provisions hereof, to the performance in all material respects
by the Company of its covenants and other obligations hereunder, and to the
following further conditions:
(a) Effectiveness of Registration Statement. The Registration Statement,
including any Rule 462(b) Registration Statement, has become effective and at
Closing Time no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of counsel to the Underwriters. A prospectus containing
the Rule 430A Information shall have been filed with the Commission in
accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with the
requirements of Rule 430A).
(b) Opinions of Counsel for Company. At Closing Time, the Representatives
shall have received the favorable opinions, each dated as of Closing Time, of
(A) Xxxxxx Xxxxxx Xxxxxxxxx Xxxx and Xxxx LLP, counsel for the Company, to the
effect set forth in Exhibit A hereto, (B) Xxxxx & Xxxxxxx L.L.P., regulatory
counsel for the Company with respect to certain federal health regulatory
matters to the effect set forth in Exhibit B hereto, and (C) Proskauer Rose LLP,
patent counsel for the Company to the effect set forth in Exhibit C hereto, each
in form and substance reasonably satisfactory to counsel for the Underwriters,
together with signed or reproduced copies of such letter for each of the other
Underwriters.
(c) Opinion of Counsel for Underwriters. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of Closing
Time, of Shearman & Sterling LLP, counsel for the Underwriters, together with
signed or reproduced copies of such letter for each of the other Underwriters,
in form and substance satisfactory to the Underwriters. In giving such opinion
such counsel may rely, as to all matters governed by the laws of jurisdictions
other than the law of the State of New York, the federal law of the United
States and the General Corporation Law of the State of Delaware, upon the
opinions of counsel satisfactory to the Representatives. Such counsel may also
state that, insofar as such opinion involves factual matters, they have relied,
to the extent they deem proper, upon certificates of officers of the Company and
the Subsidiary and certificates of public officials.
(d) Officers' Certificate. At Closing Time, there shall not have been,
since the date hereof or since the respective dates as of which information is
given in the Prospectus, any material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business prospects of the
Company and the Subsidiary considered as one enterprise, whether or not arising
in the ordinary course of business, and the Representatives shall have received
a certificate of the Company signed by the President or a Vice President of the
Company and the chief financial officer of the Company, dated as of Closing
Time, to the effect that (i) there has been no such material adverse change,
(ii) the representations and warranties in Section 1(a) hereof are true and
correct with the same force and effect as though expressly made at and as of
Closing Time, (iii) the Company has complied in all material respects with all
agreements and satisfied all conditions on its part to be performed or satisfied
at or prior to Closing Time, and (iv) no stop order suspending the effectiveness
of the Registration Statement has been issued and no proceedings for that
purpose have been instituted or are pending or, to their knowledge, contemplated
by the Commission.
(e) Accountant's Comfort Letter. At the time of the execution of this
Agreement, the Representatives shall have received from Ernst & Young LLP a
letter dated such date, in form and substance reasonably satisfactory to the
Representatives, together with signed or reproduced copies of such letter for
each of the other Underwriters containing statements and information of the type
ordinarily included in accountants' "comfort letters" to underwriters with
respect to the financial statements and certain financial information contained
in the Registration Statement and the Prospectus.
16
(f) Bring-down Comfort Letter. At Closing Time, the Representatives shall
have received from Ernst & Young LLP a letter, dated as of Closing Time, to the
effect that they reaffirm the statements made in the letter furnished pursuant
to subsection (e) of this Section, except that the specified date referred to
shall be a date not more than three business days prior to Closing Time.
(g) Approval of Listing. At Closing Time, the Securities shall have been
approved for inclusion in the Nasdaq National Market, subject only to official
notice of issuance.
(h) No Objection. The NASD has confirmed that it has not raised any
objection with respect to the fairness and reasonableness of the underwriting
terms and arrangements.
(i) Lock-up Agreements. At the date of this Agreement, the Representatives
shall have received an agreement substantially in the form of Exhibit D hereto.
(j) Conditions to Purchase of Option Securities. In the event that the
Underwriters exercise their option provided in Section 2(b) hereof to purchase
all or any portion of the Option Securities, the representations and warranties
of the Company contained herein and the statements in any certificates furnished
by the Company or the Subsidiary hereunder shall be true and correct as of each
Date of Delivery and, at the relevant Date of Delivery, the Representatives
shall have received:
(i) Officers' Certificate. A certificate, dated such Date of
Delivery, of the Company signed by the President or a Vice
President of the Company and the chief financial officer of
the Company confirming that the certificate delivered at the
Closing Time pursuant to Section 5(d) hereof remains true and
correct as of such Date of Delivery.
(ii) Opinions of Counsel for Company. The favorable opinions of (i)
Xxxxxx Xxxxxx Xxxxxxxxx Xxxx and Xxxx LLP, counsel for the
Company, (ii) Xxxxx & Xxxxxxx, L.L.P., regulatory counsel for
the Company with respect to certain federal health regulatory
matters and (iii) Proskauer Rose LLP, patent counsel for the
Company, each in form and substance reasonably satisfactory to
counsel for the Underwriters, dated such Date of Delivery,
relating to the Option Securities to be purchased on such Date
of Delivery and otherwise to the same effect as the opinion
required by Section 5(b) hereof.
(iii) Opinion of Counsel for Underwriters. The favorable opinion of
Shearman & Sterling LLP, counsel for the Underwriters, dated
such Date of Delivery, relating to the Option Securities to be
purchased on such Date of Delivery and otherwise to the same
effect as the opinion required by Section 5(c) hereof.
(iv) Bring-down Comfort Letter. A letter from Ernst & Young LLP, in
form and substance reasonably satisfactory to the
Representatives and dated such Date of Delivery, substantially
in the same form and substance as the letter furnished to the
Representatives pursuant to Section 5(f) hereof, except that
the "specified date" in the letter furnished pursuant to this
paragraph shall be a date not more than five days prior to
such Date of Delivery.
(k) Additional Documents. At Closing Time and at each Date of Delivery,
counsel for the Underwriters shall have been furnished with such standard and
customary documents and opinions as they may require for the purpose of enabling
them to pass upon the issuance and sale of the Securities as herein
contemplated, or in order to evidence the accuracy of any of the representations
or warranties, or
17
the fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of the Securities
as herein contemplated shall be reasonably satisfactory in form and substance to
the Representatives and counsel for the Underwriters.
(l) Termination of Agreement. If any condition specified in this Section
shall not have been fulfilled when and as required to be fulfilled, this
Agreement, or, in the case of any condition to the purchase of Option Securities
on a Date of Delivery which is after the Closing Time, the obligations of the
several Underwriters to purchase the relevant Option Securities, may be
terminated by the Representatives by notice to the Company at any time at or
prior to Closing Time or such Date of Delivery, as the case may be, and such
termination shall be without liability of any party to any other party except as
provided in Section 4 and except that Sections 1, 6, 7 and 8 shall survive any
such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. The Company agrees to indemnify and
hold harmless each Underwriter, its affiliates, as such term is defined in Rule
501(b) under the 1933 Act (each, an "Affiliate"), its selling agents and each
person, if any, who controls any Underwriter within the meaning of Section 15 of
the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the Rule 430A Information
or the omission or alleged omission therefrom of a material fact required
to be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact included in any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto), or the omission or
alleged omission therefrom of a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, provided that any such settlement is
effected with the written consent of the Company;
(iii) against any and all expense whatsoever, as incurred (including
the reasonable fees and disbursements of counsel chosen by Xxxxxxx Xxxxx),
reasonably incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency
or body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under (i) or
(ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through any of the Representatives expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information or any preliminary prospectus or the Prospectus (or any amendment or
supplement thereto); provided, however, that the Company shall not be liable to
any Underwriter under this Section 6 with respect to any Preliminary Prospectus
to the extent
18
that any such loss, claim, damage or liability of such Underwriter results from
the fact that such Underwriter sold Securities to a person to whom there was not
sent or given, at or prior to the written confirmation of such sale, a copy of
the Final Prospectus as then amended or supplemented, if (i) such delivery to
such person was then required by Section 5 of the Act], (ii) the Company has
furnished copies of such Final Prospectus as amended or supplemented to such
Underwriter a reasonable period of time prior to such Underwriter being required
so to deliver such Final Prospectus as amended or supplemented and (iii) the
untrue or alleged untrue statement or omission or alleged omission of material
fact contained in the Preliminary Prospectus was corrected by such Final
Prospectus as amended or supplemented.
(b) Indemnification of Company, Directors and Officers. Each Underwriter
severally agrees to indemnify and hold harmless the Company, its directors, each
of its officers who signed the Registration Statement, and each person, if any,
who controls the Company within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act against any and all loss, liability, claim, damage
and expense described in the indemnity contained in subsection (a) of this
Section, as incurred, but only with respect to untrue statements or omissions,
or alleged untrue statements or omissions, made in the Registration Statement
(or any amendment thereto), including the Rule 430A Information or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Company by such Underwriter through any of the Representatives expressly
for use in the Registration Statement (or any amendment thereto) or such
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by Xxxxxxx Xxxxx, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) Settlement Without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) or settlement of any claim in connection with any violation
referred to in Section 6(e) effected without its written consent if (i) such
settlement is entered into more than 60 days after receipt by such indemnifying
party of the aforesaid request, (ii) such indemnifying party shall have received
notice of the terms of such settlement at least 45 days prior to such settlement
being entered into,
19
(iii) such indemnifying party shall have been provided with a reasonably
detailed description of the fees and expenses to be reimbursed and (iv) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
SECTION 7. Contribution. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (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 Securities
pursuant to this Agreement or (ii) if the allocation provided by clause (i) 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 hand in connection with the statements or omissions which resulted in such
losses, liabilities, claims, damages or expenses, 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 hand in connection with the offering of the Securities
pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the Securities
pursuant to this Agreement (before deducting expenses) received by the Company
and the total underwriting discount received by the Underwriters, in each case
as set forth on the cover of the Prospectus, bear to the aggregate initial
public offering price of the Securities as set forth on the cover of the
Prospectus.
The relative fault of the Company on the one hand and the Underwriters on
the other hand shall be determined by reference to, among other things, whether
any such untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by the
Company or by the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 0000 Xxx) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act and each Underwriter's Affiliates
20
and selling agents shall have the same rights to contribution as such
Underwriter, and each director of the Company, each officer of the Company who
signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act shall have the same rights to contribution as the Company. The
Underwriters' respective obligations to contribute pursuant to this Section 7
are several in proportion to the number of Initial Securities set forth opposite
their respective names in Schedule A hereto and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive. All
representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company or the Subsidiary submitted pursuant
hereto, shall remain operative and in full force and effect, regardless of (i)
any investigation made by or on behalf of any Underwriter or its Affiliates or
selling agents, any person controlling any Underwriter, its officers or
directors or any person controlling the Company and (ii) delivery of and payment
for the Securities.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Representatives may terminate this
Agreement, by notice to the Company, at any time at or prior to Closing Time (i)
if there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the Prospectus, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and the
Subsidiary considered as one enterprise, whether or not arising in the ordinary
course of business, or (ii) if there has occurred any material adverse change in
the financial markets in the United States or the international financial
markets, any outbreak of hostilities or escalation thereof or other calamity or
crisis or any change or development involving a prospective change in national
or international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the Representatives,
impracticable or inadvisable to market the Securities or to enforce contracts
for the sale of the Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission or the Nasdaq
National Market, or if trading generally on the American Stock Exchange or the
New York Stock Exchange or in the Nasdaq National Market has been suspended or
materially limited, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices have been required, by any of said exchanges or by
such system or by order of the Commission, the NASD or any other governmental
authority, (iv) a material disruption has occurred in commercial banking or
securities settlement or clearance services in the United States or with respect
to Clearstream or Euroclear systems in Europe, or (v) if a banking moratorium
has been declared by either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof, and provided further that Sections 1, 6,
7 and 8 shall survive such termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more of
the Underwriters shall fail at Closing Time or a Date of Delivery to purchase
the Securities which it or they are obligated to purchase under this Agreement
(the "Defaulted Securities"), the Representatives shall have the right, within
24 hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, the Representatives shall not have
completed such arrangements within such 24-hour period, then:
(i) if the number of Defaulted Securities does not exceed 10% of the
number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be
21
obligated, severally and not jointly, to purchase the full amount thereof
in the proportions that their respective underwriting obligations
hereunder bear to the underwriting obligations of all non-defaulting
Underwriters, or
(ii) if the number of Defaulted Securities exceeds 10% of the number
of Securities to be purchased on such date, this Agreement or, with
respect to any Date of Delivery which occurs after the Closing Time, the
obligation of the Underwriters to purchase and of the Company to sell the
Option Securities to be purchased and sold on such Date of Delivery shall
terminate without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of
this Agreement or, in the case of a Date of Delivery which is after the Closing
Time, which does not result in a termination of the obligation of the
Underwriters to purchase and the Company to sell the relevant Option Securities,
as the case may be, either the Representatives or the Company shall have the
right to postpone Closing Time or the relevant Date of Delivery, as the case may
be, for a period not exceeding seven days in order to effect any required
changes in the Registration Statement or Prospectus or in any other documents or
arrangements. As used herein, the term "Underwriter" includes any person
substituted for an Underwriter under this Section 10.
SECTION 11. Tax Disclosure. Notwithstanding any other provision of this
Agreement, from the commencement of discussions with respect to the transactions
contemplated hereby, the Company (and each employee, representative or other
agent of the Company) may disclose to any and all persons, without limitation of
any kind, the tax treatment and tax structure (as such terms are used in
Sections 6011, 6111 and 6112 of the U.S. Code and the Treasury Regulations
promulgated thereunder) of the transactions contemplated by this Agreement and
all materials of any kind (including opinions or other tax analyses) that are
provided relating to such tax treatment and tax structure.
SECTION 12. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representatives at 4 World Financial
Center, New York, New York 10080, attention of --; and notices to the Company
shall be directed to it at 000 Xxxxx Xxxxx Xxxxxx, Xxxxx Xxxxx, Xxxxxxxx,
Xxxxxxxxxxxxx 00000, attention of Chief Executive Officer, with a copy to Xxxxx
X. Xxxxxx, Esq., Xxxxxx Xxxxxx Xxxxxxxxx Xxxx and Xxxx LLP, 00 Xxxxx Xxxxxx,
Xxxxxx, XX 00000.
SECTION 13. Parties. This Agreement shall each inure to the benefit of and
be binding upon the Underwriters and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters and the Company and their respective successors and the controlling
persons and officers and directors referred to in Sections 6 and 7 and their
heirs and legal representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the Underwriters and the Company and their
respective successors, and said controlling persons and officers and directors
and their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Securities from any Underwriter
shall be deemed to be a successor by reason merely of such purchase.
22
SECTION 14. No Fiduciary Duties. The Company acknowledges and agrees that
(i) the purchase and sale of the Securities pursuant to this Agreement,
including the determination of the public offering price of the Securities and
any related discounts and commissions, is an arm's-length commercial transaction
between the Company, on the one hand, and the several Underwriters, on the other
hand, (ii) in connection with the offering contemplated hereby and the process
leading to such transaction each Underwriter is and has been acting solely as a
principal and is not the agent or fiduciary of the Company, or its stockholders,
creditors, employees or any other party, (iii) no Underwriter has assumed or
will assume an advisory or fiduciary responsibility in favor of the Company with
respect to the offering contemplated hereby or the process leading thereto
(irrespective of whether such Underwriter has advised or is currently advising
the Company on other matters) and no Underwriter has any obligation to the
Company with respect to the offering contemplated hereby except the obligations
expressly set forth in this Agreement, (iv) the Underwriters and their
respective affiliates may be engaged in a broad range of transactions that
involve interests that differ from those of the Company, and (v) the
Underwriters have not provided any legal, accounting, regulatory or tax advice
with respect to the offering contemplated hereby and the Company has consulted
its own legal, accounting, regulatory and tax advisors to the extent it deemed
appropriate.
SECTION 15. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SECTION 16. TIME. TIME SHALL BE OF THE ESSENCE OF THIS AGREEMENT. EXCEPT
AS OTHERWISE SET FORTH HEREIN, SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY
TIME.
SECTION 17. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
SECTION 18. Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction hereof.
23
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the Underwriters and the Company in accordance with its terms.
Very truly yours,
NxSTAGE MEDICAL, INC.
By
-----------------------------------
Title:
24
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
XXXXXX XXXXXX PARTNERS LLC
XXXXXXX XXXXX & COMPANY, L.L.C.
JMP SECURITIES LLC
By: XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By
--------------------------------------
Authorized Signatory
For itself and as Representatives of the other Underwriters
named in Schedule A hereto.
25
SCHEDULE A
Number of
Initial U.S.
Name of Underwriter Securities
------------------- ----------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated......................................
Xxxxxx Xxxxxx Partners LLC..................................
Xxxxxxx Xxxxx & Company, L.L.C..............................
JMP Securities LLC..........................................
------------
Total.......................................................
============
Sch A-1
SCHEDULE B
NxStage Medical, Inc.
-- Shares of Common Stock
(Par Value $-- Per Share)
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $--.
2. The purchase price per share for the Securities to be paid by the
several Underwriters shall be $--, being an amount equal to the initial public
offering price set forth above less $-- per share; provided that the purchase
price per share for any Option Securities purchased upon the exercise of the
overallotment option described in Section 2(b) shall be reduced by an amount per
share equal to any dividends or distributions declared by the Company and
payable on the Initial Securities but not payable on the Option Securities.
Sch B-1
Exhibit A
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)
(i) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Delaware.
(ii) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under the
Underwriting Agreement.
(iii) The Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which
such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure
so to qualify or to be in good standing would not result in a Material
Adverse Effect.
(iv) The authorized, issued and outstanding capital stock of the
Company is as set forth in the Prospectus in the column entitled "Actual"
under the caption "Capitalization" (except for subsequent issuances, if
any, pursuant to the
Underwriting Agreement or pursuant to reservations,
agreements or employee benefit plans referred to in the Prospectus or
pursuant to the exercise of convertible securities or options referred to
in the Prospectus); the shares of issued and outstanding capital stock
have been duly authorized and validly issued and are fully paid and
non-assessable; and none of the outstanding shares of capital stock of the
Company was issued in violation of the preemptive or other similar rights
of any securityholder of the Company.
(v) The Securities to be purchased by the Underwriters and the
International Managers from the Company have been duly authorized for
issuance and sale to the Underwriters pursuant to the
Underwriting
Agreement and, when issued and delivered by the Company pursuant to the
Underwriting Agreement against payment of the consideration set forth in
the
Underwriting Agreement, will be validly issued and fully paid and
non-assessable and no holder of the Securities is or will be subject to
personal liability by reason of being such a holder.
(vi) The issuance of the Securities is not subject to the preemptive
or other similar rights of any securityholder of the Company.
(vii) Each Subsidiary has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has corporate power and authority to
own, lease and operate its properties and to conduct its business as
described in the Prospectus and is duly qualified as a foreign corporation
to transact business and is in good standing in each jurisdiction in which
such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure
so to qualify or to be in good standing would not result in a Material
Adverse Effect; except as otherwise disclosed in the Registration
Statement, all of the issued and outstanding capital stock of each
Subsidiary has been duly authorized and validly issued, is fully paid and
non-assessable and, to the best of our knowledge, is owned by the Company,
directly or through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity; none
A-1
of the outstanding shares of capital stock of any Subsidiary was issued in
violation of the preemptive or similar rights of any securityholder of
such Subsidiary.
(viii) The
Underwriting Agreement has been duly authorized, executed
and delivered by the Company.
(ix) The Registration Statement, including any Rule 462(b)
Registration Statement, has been declared effective under the 1933 Act;
any required filing of the Prospectus pursuant to Rule 424(b) has been
made in the manner and within the time period required by Rule 424(b);
and, to the best of our knowledge, no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or
threatened by the Commission.
(x) The Registration Statement, including any Rule 462(b)
Registration Statement and the Rule 430A Information, the Prospectus and
each amendment or supplement to the Registration Statement and the
Prospectus as of their respective effective or issue dates (other than the
financial statements and supporting schedules included therein or omitted
therefrom, as to which we need express no opinion) complied as to form in
all material respects with the requirements of the 1933 Act and the 1933
Act Regulations.
(xi) The form of certificate used to evidence the Common Stock
complies in all material respects with all applicable statutory
requirements, with any applicable requirements of the charter and by-laws
of the Company and the requirements of the Nasdaq National Market.
(xii) To the best of our knowledge, there is not pending or
threatened any action, suit, proceeding, inquiry or investigation, to
which the Company or any subsidiary is a party, or to which the property
of the Company or any subsidiary is subject, before or brought by any
court or governmental agency or body, domestic or foreign, which would
reasonably be expected to result in a Material Adverse Effect, or which
would reasonably be expected to materially and adversely affect the
properties or assets thereof or the consummation of the transactions
contemplated in the
Underwriting Agreement or the performance by the
Company of its obligations thereunder.
(xiii) The information in the Prospectus under "Business --
Intellectual Property", "Business -- Government Regulation", "Business --
Foreign Regulation of Medical Devices", "Business -- Fraud and Abuse
Laws", "Business -- Legal Proceedings", "Management -- Employee Benefit
Plans", "Certain Relationships and Related Party Transactions",
"Description of Capital Stock," "Certain Material United States Federal
Income Tax Considerations for Non-United States Holders", "Shares Eligible
for Future Sale", "Underwriting" and in the Registration Statement under
Item 14, to the extent that it constitutes matters of law, summaries of
legal matters, the Company's charter and bylaws or legal proceedings, or
legal conclusions, has been reviewed by us and is correct in all material
respects.
(xiv) All descriptions in the Prospectus of contracts and other
documents to which the Company or its subsidiaries are a party are
accurate in all material respects; to the best of our knowledge, there are
no franchises, contracts, indentures, mortgages, loan agreements, notes,
leases or other instruments required to be described or referred to in the
Registration Statement or to be filed as exhibits to the Registration
Statement other than those described or referred to therein or filed as
exhibits thereto.
A-2
(xv) No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, any court or governmental
authority or agency, domestic or foreign (other than under the 1933 Act
and the 1933 Act Regulations, which have been obtained, or as may be
required under the securities or blue sky laws of the various states, as
to which we need express no opinion) is necessary or required in
connection with the due authorization, execution and delivery of the
Underwriting Agreement or for the offering, issuance, sale or delivery of
the Securities.
(xvi) The execution, delivery and performance of the Underwriting
Agreement and the consummation of the transactions contemplated in the
Underwriting Agreement and in the Registration Statement (including the
issuance and sale of the Securities, and the use of the proceeds from the
sale of the Securities as described in the Prospectus under the caption
"Use Of Proceeds") and compliance by the Company with its obligations
under the Underwriting Agreement do not and will not, whether with or
without the giving of notice or lapse of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined in
Section 1(a)(x) of the Underwriting Agreement) under or result in the
creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any subsidiary pursuant to any
contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, lease or any other agreement or instrument, known to us, to which
the Company or any subsidiary is a party or by which it or any of them may
be bound, or to which any of the property or assets of the Company or any
subsidiary is subject (except for such conflicts, breaches, defaults or
Repayment Events or liens, charges or encumbrances that would not have a
Material Adverse Effect), nor will such action result in any violation of
the provisions of the charter or by-laws of the Company or any subsidiary,
or any applicable law, statute, rule, regulation, judgment, order, writ or
decree, known to us, of any government, government instrumentality or
court, domestic or foreign, having jurisdiction over the Company or any
subsidiary or any of their respective properties, assets or operations.
(xvii) To the best of our knowledge, there are no persons with
registration rights or other similar rights to have any securities
registered pursuant to the Registration Statement or otherwise registered
by the Company under the 0000 Xxx.
(xviii) The Company is not required, and upon the issuance and sale
of the Securities as herein contemplated and the application of the net
proceeds therefrom as described in the Prospectus will not be required, to
register as an "investment company" under the 1940 Act.
(xix) The Rights under the Company's Shareholder Rights Plan to
which holders of the Securities will be entitled have been duly authorized
and validly issued.
(xx) The statements in the Prospectus under the captions: "Risk
Factors - Risks Related to our Business - We are not permitted to market
our System One for home use unless and until we receive clearance from the
FDA. If we do not receive specific clearance from the FDA that the System
One is suitable for home use, then we may be unable to generate
significant revenue", and "Risk Factors - Risks Related to our Regulatory
Environment" and "Business", insofar as such statements summarize the
United States Federal Food, Drug and Cosmetic Act, as amended (the "FDC
Act"), the regulations promulgated under the FDC Act and the FDA approval
process under the FDC Act as they relate to the Company and its
subsidiaries, are correct and not misleading in all material aspects as of
the date of the Prospectus and as of the date hereof.
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(xxi) To the best of our knowledge, there are no laws, statutes,
rules or recommendations administered by the FDA that are material to the
business of the Company and its subsidiaries, considered as one entity,
that are not described in the Prospectus.
(xxii) To the best of our knowledge, there are no outstanding or
threatened judgments, decrees or orders that have been issued against the
Company or any of its subsidiaries by the FDA and the Company has
certified to us that there is no such outstanding or threatened adverse
judgment, decree or order.
(xxiii) We have no reason to believe that the business of the
Company, as described in the Prospectus, is not being conducted in
compliance with applicable requirements of the FDC Act, and any
regulations issued thereunder, except in any such case where a failure to
be so conducted would not have a Material Adverse Effect.
(xxiv) The execution and delivery of the Underwriting Agreement and
the consummation of the transactions contemplated in the Underwriting
Agreement do not and will not (i) violate any requirement of the FDC Act,
or any regulation issued thereunder, or (ii) result in the creation of any
lien, charge, encumbrance upon any property or assets of the Company due
to the operation of the FDC Act, or any regulation issued thereunder.
Nothing has come to our attention that would lead us to believe that the
Registration Statement or any amendment thereto, including the Rule 430A
Information, (except for financial statements and schedules and other financial
data included therein or omitted therefrom, as to which we need make no
statement), at the time such Registration Statement or any such amendment became
effective, contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus or any amendment or
supplement thereto (except for financial statements and schedules and other
financial data included therein or omitted therefrom, as to which we need make
no statement), at the time the Prospectus was issued, at the time any such
amended or supplemented prospectus was issued or at the Closing Time, included
or includes an untrue statement of a material fact or omitted or omits to state
a material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading.
In rendering such opinion, such counsel may rely, as to matters of fact
(but not as to legal conclusions), to the extent they deem proper, on
certificates of responsible officers of the Company and public officials. Such
opinion shall not state that it is to be governed or qualified by, or that it is
otherwise subject to, any treatise, written policy or other document relating to
legal opinions, including, without limitation, the Legal Opinion Accord of the
ABA Section of Business Law (1991).
A-4
Exhibit B
FORM OF OPINION OF COMPANY'S REGULATORY COUNSEL WITH RESPECT TO CERTAIN MEDICARE
AND MEDICAID RELATED MATTERS TO BE DELIVERED PURSUANT TO SECTION 5(b)
(i) The information in the Prospectus under "Risk Factors - Risks Related to our
Regulatory Environment -- Changes in reimbursement for treatment for ESRD could
affect the adoption of our System and our future product sales", "Business --
Reimbursement", "Business -- Foreign Regulation of Medical Devices", "Business
-- Fraud and Abuse Laws", and "Business -- Legal Proceedings", to the extent
that it constitutes matters of law, summaries of legal matters, legal
proceedings, or legal conclusions, has been reviewed by us and is correct and
not misleading in all material respects as of the date of the Prospectus and as
of the date hereof.
(ii) To our knowledge, there are no laws, statutes, ordinances, rules,
regulations or recommendations with respect to Medicare and Medicaid that are
material to the business of the Company and its subsidiaries, considered as one
entity, that are not described in the Prospectus.
(iii) To our knowledge, there are no outstanding or threatened judgments,
decrees or orders that have been issued against the Company or any of its
subsidiaries by The Centers for Medicare and Medical Services and the Company
has certified to us that there is no such outstanding or threatened adverse
judgment, decree or order.
(iv) We have no reason to believe that the business of the Company, as described
in the Prospectus, is not being conducted in compliance with applicable
requirements or regulations with respect to Medicare and Medicaid, except in any
such case where a failure to be so conducted would not have a Material Adverse
Effect.
(v) The execution and delivery of the Underwriting Agreement and the
consummation of the transactions contemplated in the Underwriting Agreement do
not and will not (i) violate any requirement of laws, statutes, ordinances,
rules, regulations or recommendations relating to Medicare and Medicaid, or (ii)
result in the creation of any lien, charge, encumbrance upon any property or
assets of the Company due to the operation of the laws, statutes, ordinances,
rules, regulations or recommendations relating to Medicare and Medicaid.
B-1
Exhibit C
FORM OF OPINION OF INTELLECTUAL PROPERTY COUNSEL
1. Schedule A attached hereto is a true and complete list of patents and
patent applications ("Patents"), and trademark registrations and
applications ("Trademarks") owned by or licensed to the Company. Schedule
B attached hereto is a true and complete list of license and intellectual
property related agreements to which the Company is a party ("Licenses").
2. To the best of our knowledge, [except as disclosed in the Prospectus,] the
Company is the exclusive owner of all right, title, and interest in the
owned Patents; all such Patents have been properly prepared as to form and
have been assigned solely to the Company, which assignments are either
recorded in the U.S. Patent and Trademark Office or other foreign patent
office, as applicable, or have been submitted for recording in the U.S.
Patent and Trademark Office or other foreign patent office, as applicable;
and each of the pending patent applications included in the Patents is
being diligently prosecuted by the Company. With respect to Patents that
have been assigned to the Company, we have no reason to believe that such
assignments are invalid.
3. To the best of our knowledge, there is no prior art or combination of
prior art that would invalidate (a) the claims of any issued Patents or
(b) pending patent applications included in the Patents if claims of such
pending patents applications were issued in substantially the same form as
currently written.
4. To the best of our knowledge, the issued Patents and registered Trademarks
have been duly maintained and are in full force and in effect. None of the
Patents or Trademarks has been adjudged invalid or unenforceable in whole
or in part.
5. To the best of our knowledge, the Licenses are in full force and in
effect, no party thereto is in breach or default thereof, and the Company
is not engaged in any activity that would be prohibited under the terms of
the Licenses.
6. To the best of our knowledge, the operation of the business of the
Company, as now conducted or as proposed in the Prospectus to be
conducted, together with the use of the Intellectual Property Rights owned
by or licensed to the Company, does not conflict with, infringe,
misappropriate or otherwise violate the intellectual property rights of
any third party. Except as disclosed in the Prospectus, no actions, suits,
claims or proceedings have been asserted or, to the best of our knowledge,
threatened against the Company alleging any of the foregoing or seeking to
challenge, deny or restrict the operation of the business of the Company.
No Court has issued any order, judgment, decree or injunction restricting
the operation of the business of the Company.
7. The statements and the information contained in the Intellectual Property
Sections are accurate in all material respects, fairly represent the
matters disclosed therein and do not omit to state a material fact or
facts necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
C-1
Exhibit D
--, 2005
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Xxxxxxx Xxxxx & Company, L.L.C.
Xxxxxx Xxxxxx Partners LLC
as Representatives of the several
Underwriters to be named in the
within-mentioned Underwriting Agreement
x/x Xxxxxxx Xxxxx & Xx.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Proposed Public Offering by
NxStage Medical, Inc.
Dear Sirs:
The undersigned, a stockholder and an officer and/or director of
NxStage
Medical, Inc., a Delaware corporation (the "Company"), understands that Xxxxxxx
Xxxxx & Co., Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx
Xxxxx"), Xxxxxxx Xxxxx & Company, L.L.C. and Xxxxxx Xxxxxx Partners LLC propose
to enter into an Underwriting Agreement (the "Underwriting Agreement") with the
Company providing for the public offering of shares (the "Securities") of the
Company's common stock, par value $0.0001 per share (the "Common Stock"). In
recognition of the benefit that such an offering will confer upon the
undersigned as a stockholder and an officer and/or director of the Company, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the undersigned agrees with each underwriter to be
named in the Underwriting Agreement that, during a period of 180 days from the
date of the Underwriting Agreement, the undersigned will not, without the prior
written consent of Xxxxxxx Xxxxx, directly or indirectly, (i) offer, pledge,
sell, contract to sell, sell any option or contract to purchase, purchase any
option or contract to sell, grant any option, right or warrant for the sale of,
or otherwise dispose of or transfer any shares of the Company's Common Stock or
any securities convertible into or exchangeable or exercisable for Common Stock,
whether now owned or hereafter acquired by the undersigned or with respect to
which the undersigned has or hereafter acquires the power of disposition, or
file, or cause to be filed, any registration statement under the Securities Act
of 1933, as amended, with respect to any of the foregoing (collectively, the
"Lock-Up Securities") or (ii) enter into any swap or any other agreement or any
transaction that transfers, in whole or in part, directly or indirectly, the
economic consequence of ownership of the Lock-Up Securities, whether any such
swap or transaction is to be settled by delivery of Common Stock or other
securities, in cash or otherwise.
Notwithstanding the foregoing, if:
(1) during the last 17 days of the 180-day lock-up period, the Company
issues an earnings release or material news or a material event relating to the
Company occurs; or
E-1
(2) prior to the expiration of the 180-day lock-up period, the Company
announces that it will release earnings results or becomes aware that material
news or a material event will occur during the 16-day period beginning on the
last day of the 180-day lock-up period,
the restrictions imposed by this letter shall continue to apply until the
expiration of the 18-day period beginning on the issuance of the earnings
release or the occurrence of the material news or material event, as applicable,
unless Xxxxxxx Xxxxx waives, in writing, such extension.
The undersigned hereby acknowledges and agrees that written notice of any
extension of the 180-day lock-up period pursuant to the previous paragraph will
be delivered by Xxxxxxx Xxxxx to the Company (in accordance with Section 12 of
the Underwriting Agreement) and that any such notice properly delivered will be
deemed to have been given to, and received by, the undersigned. The undersigned
further agrees that, prior to engaging in any transaction or taking any other
action that is subject to the terms of this lock-up agreement during the period
from the date of this lock-up agreement to and including the 34th day following
the expiration of the initial 180-day lock-up period, it will give notice
thereof to the Company and will not consummate such transaction or take any such
action unless it has received written confirmation from the Company that the
180-day lock-up period (as may have been extended pursuant to the previous
paragraph) has expired.
The undersigned also agrees and consents to the entry of stop transfer
instructions with the Company's transfer agent and registrar against the
transfer of the Lock-Up Securities except in compliance with the foregoing
restrictions.
Very truly yours,
Signature:
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Print Name:
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