1
3,473,000 Shares
HORIZON MEDICAL PRODUCTS, INC.
Common Stock
$.001 par value
UNDERWRITING AGREEMENT
April ___, 1998
Credit Suisse First Boston Corporation
BancAmerica Xxxxxxxxx Xxxxxxxx
NationsBanc Xxxxxxxxxx Securities LLC
As Representatives (the "Representatives")
of the Several Underwriters,
c/o Credit Suisse First Boston Corporation,
Eleven Madison Avenue,
New York, N.Y. 10010-3629
Dear Sirs:
1. Introductory. Horizon Medical Products, Inc., a Georgia
corporation (the "Company"), proposes to issue and sell to the several
underwriters named in Schedule A hereto (the "Underwriters") 2,600,000 shares
of its Common Stock, $.001 par value per share (the "Securities"), and the
shareholders listed in Schedule B hereto (the "Selling Shareholders") propose
severally to sell an aggregate of 873,000 outstanding shares of the Securities
(such 3,473,000 shares of the Securities being hereinafter referred to as the
"Firm Securities"). The Company also proposes to sell to the Underwriters, at
the option of the Underwriters, an aggregate of not more than 520,950
additional shares of its Securities as set forth below (such 520,950 additional
shares being hereinafter referred to as the "Optional Securities"). The Firm
Securities and the Optional Securities are herein collectively referred to as
the "Offered Securities." The Company and the Selling Shareholders hereby agree
with the several Underwriters as follows:
2. Representations and Warranties of the Company and the Selling
Shareholders.
(a) The Company represents and warrants to, and agrees with, the
several Underwriters that:
(i) A registration statement (No. 333-46349) relating to the
Offered Securities, including a form of prospectus, has been filed
with the Securities and Exchange Commission (the "Commission") and
either (A) has been declared effective under the Securities Act of
1933, as amended (the "Act"), and is not proposed to be amended or (B)
is proposed to be amended by amendment or post-effective amendment. If
such registration statement (the
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"initial registration statement") has been declared effective, either
(A) an additional registration statement (the "additional registration
statement") relating to the Offered Securities may have been filed
with the Commission pursuant to Rule 462(b) ("Rule 462(b)") under the
Act and, if so filed, has become effective upon filing pursuant to
such Rule and the Offered Securities all have been duly registered
under the Act pursuant to the initial registration statement and, if
applicable, the additional registration statement or (B) such an
additional registration statement is proposed to be filed with the
Commission pursuant to Rule 462(b) and will become effective upon
filing pursuant to such Rule and upon such filing the Offered
Securities will all have been duly registered under the Act pursuant
to the initial registration statement and such additional registration
statement. If the Company does not propose to amend the initial
registration statement or if an additional registration statement has
been filed and the Company does not propose to amend it, and if any
post-effective amendment to either such registration statement has
been filed with the Commission prior to the execution and delivery of
this Agreement, the most recent amendment (if any) to each such
registration statement has been declared effective by the Commission
or has become effective upon filing pursuant to Rule 462(c) ("Rule
462(c)") under the Act or, in the case of the additional registration
statement, Rule 462(b). For purposes of this Agreement, "Effective
Time" with respect to the initial registration statement or, if filed
prior to the execution and delivery of this Agreement, the additional
registration statement means (A) if the Company has advised the
Representatives that it does not propose to amend such registration
statement, the date and time as of which such registration statement,
or the most recent post-effective amendment thereto (if any) filed
prior to the execution and delivery of this Agreement, was declared
effective by the Commission or has become effective upon filing
pursuant to Rule 462(c), or (B) if the Company has advised the
Representatives that it proposes to file an amendment or
post-effective amendment to such registration statement, the date and
time as of which such registration statement, as amended by such
amendment or post-effective amendment, as the case may be, is declared
effective by the Commission. If an additional registration statement
has not been filed prior to the execution and delivery of this
Agreement but the Company has advised the Representatives that it
proposes to file one, "Effective Time" with respect to such additional
registration statement means the date and time as of which such
registration statement is filed and becomes effective pursuant to Rule
462(b). "Effective Date" with respect to the initial registration
statement or the additional registration statement (if any) means the
date of the Effective Time thereof. The initial registration
statement, as amended at its Effective Time, including all information
contained in the additional registration statement (if any) and deemed
to be a part of the initial registration statement as of the Effective
Time of the additional registration statement pursuant to the General
Instructions of the Form on which it is filed and including all
information (if any) deemed to be a part of the initial registration
statement as of the Effective Time pursuant to Rule 430A(b) ("Rule
430A(b)") under the Act, is hereinafter referred to as the "Initial
Registration Statement." The additional registration statement, as
amended at its Effective Time, including the contents of the initial
registration statement incorporated by reference therein and including
all information (if any) deemed to be a part of the additional
registration statement as of its Effective Time pursuant to Rule
430A(b), is hereinafter referred to as the "Additional Registration
Statement." The Initial Registration Statement and the Additional
Registration
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Statement are hereinafter referred to collectively as the
"Registration Statements" and individually as a "Registration
Statement." The form of prospectus relating to the Offered Securities,
as first filed with the Commission pursuant to and in accordance with
Rule 424(b) ("Rule 424(b)") under the Act or (if no such filing is
required) as included in a Registration Statement, is hereinafter
referred to as the "Prospectus." No document has been or will be
prepared or distributed in reliance on Rule 434 under the Act.
(ii) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement:
(A) on the Effective Date of the Initial Registration Statement, the
Initial Registration Statement conformed in all respects to the
requirements of the Act and the rules and regulations of the
Commission ("Rules and Regulations") and did not include any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading, (B) on the Effective Date of the Additional
Registration Statement (if any), each Registration Statement conformed
or will conform, in all material respects to the requirements of the
Act and the Rules and Regulations and did not include, or will not
include, any untrue statement of a material fact and did not omit, or
will not omit, to state any material fact required to be stated
therein or necessary to make the statements therein not misleading,
and (C) on the date of this Agreement, the Initial Registration
Statement and, if the Effective Time of the Additional Registration
Statement is prior to the execution and delivery of this Agreement,
the Additional Registration Statement each conforms, and at the time
of filing of the Prospectus pursuant to Rule 424(b) or (if no such
filing is required) at the Effective Date of the Additional
Registration Statement in which the Prospectus is included, each
Registration Statement and the Prospectus will conform, in all
material respects to the requirements of the Act and the Rules and
Regulations, and does not include, or will not include, with respect
to each Registration Statement, any untrue statement of a material
fact or does not omit, or will not omit, to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, or with respect to the Prospectus, any untrue
statement of a material fact or does not omit, or will not omit, to
state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
such statements were made, not misleading. If the Effective Time of
the Initial Registration Statement is subsequent to the execution and
delivery of this Agreement: on the Effective Date of the Initial
Registration Statement, the Initial Registration Statement and the
Prospectus will conform in all material respects to the requirements
of the Act and the Rules and Regulations, and will not include, with
respect to the Initial Registration Statement, any untrue statement of
a material fact or will not omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading, or with respect to the Prospectus, any untrue statement of
a material fact or will not omit to state a material fact required to
be stated therein or necessary to make the statements therein, in
light of the circumstances under which such statements were made, not
misleading and no Additional Registration Statement has been or will
be filed. The two preceding sentences do not apply to statements in or
omissions from a Registration Statement or the Prospectus based upon
written information furnished to the Company by any Underwriter
through the Representatives specifically for use therein, it being
understood and agreed that the only such information is that described
as such in Section 7(c) hereof.
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(iii) The Company has been duly incorporated and is an
existing corporation in good standing under the laws of the State of
Georgia, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus;
and the Company is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions in which its
ownership or lease of property or the conduct of its business requires
such qualification, except where the failure to be so qualified or in
good standing would not have a material adverse effect on the
condition (financial or otherwise), business, properties or results of
operations of the Company and its subsidiaries taken as a whole (a
"Material Adverse Effect").
(iv) Each subsidiary of the Company has been duly
incorporated and is an existing corporation in good standing under the
laws of the jurisdiction of its incorporation, with power and
authority (corporate and other) to own its properties and conduct its
business as described in the Prospectus; and each subsidiary of the
Company is duly qualified to do business as a foreign corporation in
good standing in all other jurisdictions in which its ownership or
lease of property or the conduct of its business requires such
qualification except where the failure to be so qualified or in good
standing would not have a Material Adverse Effect; all of the issued
and outstanding capital stock of each subsidiary of the Company has
been duly authorized and validly issued and is fully paid and
nonassessable; and the capital stock of each subsidiary owned by the
Company, directly or through subsidiaries, is owned free from liens,
encumbrances and defects.
(v) The Offered Securities and all other outstanding
shares of capital stock of the Company have been duly authorized and
are validly issued, fully paid and nonassessable and conform to the
description thereof contained in the Prospectus; and the shareholders
of the Company have no preemptive rights with respect to the
Securities.
(vi) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Company and any
person that would give rise to a valid claim against the Company or
any Underwriter for a brokerage commission, finder's fee or other like
payment in connection with the transactions contemplated by this
Agreement.
(vii) There are no contracts, agreements or understandings
between the Company and any person or entity granting such person or
entity the right to require the Company to file a registration
statement under the Act with respect to any securities of the Company
owned or to be owned by such person or entity or to require the
Company to include such securities in the securities registered
pursuant to a Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the
Company under the Act which has not effectively been satisfied or
waived.
(viii) The Offered Securities have been approved for listing,
subject to notice of issuance, on the Nasdaq Stock Market's National
Market.
(ix) No consent, approval, authorization, or order of, or
filing with, any governmental agency or body or any court is required
to be obtained or made by the
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Company for the consummation of the transactions contemplated by this
Agreement in connection with the sale of the Offered Securities,
except such as have been obtained and made under the Act and such as
may be required under state securities laws.
(x) The execution, delivery and performance of this
Agreement and the consummation of the transactions herein contemplated
will not result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any statute, any rule,
regulation or order of any governmental agency or body or any court,
domestic or foreign, having jurisdiction over the Company or any
subsidiary of the Company or any of their properties, or any agreement
or instrument to which the Company or any such subsidiary is a party
or by which the Company or any such subsidiary is bound or to which
any of the properties of the Company or any such subsidiary is
subject, or the charter or by-laws of the Company or any such
subsidiary.
(xi) This Agreement has been duly authorized, executed and
delivered by the Company.
(xii) Except as disclosed in the Prospectus, the Company and
its subsidiaries have good and marketable title to all real properties
and all other properties and assets owned by them, in each case free
from liens, encumbrances and defects that would materially affect the
value thereof or materially interfere with the use made or to be made
thereof; and except as disclosed in the Prospectus, the Company and
its subsidiaries hold any leased real or personal property under valid
and enforceable leases with no exceptions that would materially
interfere with the use made or to be made thereof.
(xiii) The Company and its subsidiaries possess adequate
certificates, certifications, approvals, authorities or permits issued
by appropriate governmental or regulatory agencies or bodies necessary
to conduct the business now operated by them and have not received any
notice of proceedings relating to the revocation or modification of
any such certificate, certification, approval, authority or permit
that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a Material
Adverse Effect. The Company is not aware of and has no reason to
believe that it will not receive such certificates, certifications,
approvals, authorities or permits to be issued by appropriate
governmental or regulatory agencies or bodies necessary to conduct the
business proposed to be conducted by the Company and any of its
subsidiaries and described in the Prospectus at its Manchester,
Georgia facility by June 30, 1998.
(xiv) No labor dispute with the employees of the Company or
any subsidiary exists or, to the knowledge of the Company, is
threatened that might have a Material Adverse Effect.
(xv) The Company and its subsidiaries own, possess or can
acquire on reasonable terms adequate trademarks, trade names and other
rights to inventions, know-how, patents, copyrights, confidential
information and other intellectual property (collectively,
"intellectual property rights") necessary to conduct the business now
operated by them, or presently
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employed by them, and have not received any notice of infringement of
or conflict with asserted rights of others with respect to any
intellectual property rights that, if determined adversely to the
Company or any of its subsidiaries, would individually or in the
aggregate have a Material Adverse Effect. To the knowledge of the
Company, the Company's and its subsidiaries' present use of any of the
intellectual property rights does not infringe on any rights of third
parties or conflict with any asserted rights of others that, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a Material Adverse Effect.
(xvi) Except as disclosed in the Prospectus, neither the
Company nor any of its subsidiaries is in violation of any statute,
any rule, regulation, decision or order of any governmental agency or
body or any court, domestic or foreign, relating to the use, disposal
or release of hazardous or toxic substances or relating to the
protection or restoration of the environment or human exposure to
hazardous or toxic substances (collectively, "environmental laws"),
owns or operates any real property contaminated with any substance
that is subject to any environmental laws, is liable for any off-site
disposal or contamination pursuant to any environmental laws, or is
subject to any claim relating to any environmental laws, which
violation, contamination, liability or claim would individually or in
the aggregate have a Material Adverse Effect, and the Company is not
aware of any pending or threatened investigation or inquiry which
might lead to such a claim.
(xvii) Except as disclosed in the Prospectus, there are no
pending actions, suits or proceedings against or affecting the
Company, any of its subsidiaries or any of their respective properties
that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a Material
Adverse Effect, or would materially and adversely affect the ability
of the Company to perform its obligations under this Agreement, or
which are otherwise material in the context of the sale of the Offered
Securities; and no such actions, suits or proceedings are, to the
Company`s knowledge, threatened or contemplated.
(xviii) The financial statements included in each
Registration Statement and the Prospectus present fairly the financial
position of the Company and its consolidated subsidiaries and of
Strato/Infusaid Inc. as of the dates shown and their results of
operations and cash flows for the periods shown and, except as
otherwise disclosed in the Prospectus, such financial statements have
been prepared in conformity with the generally accepted accounting
principles in the United States applied on a consistent basis and the
schedules included in each Registration Statement present fairly the
information required to be stated therein; and the assumptions used in
preparing the pro forma financial statements included in each
Registration Statement and the Prospectus provide a reasonable basis
for presenting the significant effects directly attributable to the
transactions or events described therein, the related pro forma
adjustments give appropriate effect to those assumptions, and the pro
forma columns therein reflect the proper application of those
adjustments to the corresponding historical financial statement
amounts.
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(xix) Except as disclosed in the Prospectus, since the date
of the latest audited consolidated financial statements of the Company
included in the Prospectus there has been no material adverse change,
nor any development or event that may result in a prospective Material
Adverse Effect; and except as disclosed in or contemplated by the
Prospectus, there has been no dividend or distribution of any kind
declared, paid or made by the Company on any class of its capital
stock.
(xx) The Company is not and, after giving effect to the
offering and sale of the Offered Securities and the application of the
proceeds thereof as described in the Prospectus, will not be an
"investment company" as defined in the Investment Company Act of 1940.
(xxi) Neither the Company nor any of its affiliates does
business with the government of Cuba or with any person or affiliate
located in Cuba within the meaning of Section 517.075, Florida
Statutes and the Company agrees to comply with such Section if prior
to the completion of the distribution of the Offered Securities it
commences doing such business.
(b) The Selling Shareholders severally represent and warrant to,
and agree with, the several Underwriters that:
(i) Such Selling Shareholders have, and on the First
Closing Date hereinafter mentioned will have, valid and unencumbered
title to the Offered Securities to be delivered by such Selling
Shareholders on such First Closing Date, and full right, power and
authority to enter into this Agreement and to sell, assign, transfer
and deliver the Offered Securities to be delivered by such Selling
Shareholders on such First Closing Date hereunder; and upon the
delivery of and payment for the Offered Securities on such First
Closing Date hereunder the several Underwriters will acquire valid and
unencumbered title to the Offered Securities to be delivered by such
Selling Shareholders on such First Closing Date.
(ii) If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement:
(A) on the Effective Date of the Initial Registration Statement, the
Initial Registration Statement conformed in all material respects to
the requirements of the Act and the Rules and Regulations and did not
include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading, (B) on the Effective Date of the
Additional Registration Statement (if any), each Registration
Statement conformed, or will conform, in all material respects to the
requirements of the Act and the Rules and Regulations, and did not
include, or will not include, with respect to each Registration
Statement, any untrue statement of a material fact or did not omit,
and will not omit, to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, or
with respect to the Prospectus, any untrue statement of a material
fact or did not omit, and will not omit, to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which such statements were made, not misleading,
and (C) on the date of this Agreement, the Initial Registration
Statement and, if the Effective Time of the Additional Registration
Statement is prior to the execution and
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delivery of this Agreement, the Additional Registration Statement each
conforms, and at the time of filing of the Prospectus pursuant to Rule
424(b) or (if no such filing is required) at the Effective Date of the
Additional Registration Statement in which the Prospectus is included,
each Registration Statement and the Prospectus will conform, in all
material respects to the requirements of the Act and the Rules and
Regulations, and neither of such documents includes, or will include,
any untrue statement of a material fact or omits, or will omit, to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading. If the Effective Time of
the Initial Registration Statement is subsequent to the execution and
delivery of this Agreement: on the Effective Date of the Initial
Registration Statement, the Initial Registration Statement and the
Prospectus will conform in all material respects to the requirements
of the Act and the Rules and Regulations, will not include, with
respect to the Initial Registration Statement, any untrue statement of
a material fact or will not omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading, or with respect to the Prospectus any untrue statement of
a material fact or will not omit to state a material fact necessary in
order to make the statements therein, in light of the circumstances
under which such statements were made, not misleading. The two
preceding sentences apply only to the extent that any statements in or
omissions from a Registration Statement or the Prospectus are based on
written information furnished to the Company by such Selling
Shareholders specifically for use therein.
(iii) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between such Selling
Shareholders and any person that would give rise to a valid claim
against such Selling Shareholders or any Underwriter for a brokerage
commission, finder's fee or other like payment in connection with the
transactions contemplated by this Agreement.
3. Purchase, Sale and Delivery of Offered Securities. On the
basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Company and each of
the Selling Shareholders agree, severally and not jointly, to sell to each
Underwriter, and each Underwriter agrees, severally and not jointly, to
purchase from the Company and each Selling Shareholder, at a purchase price of
$___________ per share, the respective number of shares of Firm Securities set
forth below the caption "Company" or "Selling Shareholders," as the case may
be, and opposite the name of such Underwriter in Schedule A hereto.
Certificates in negotiable form for the Offered Securities to be sold
by certain of the Selling Shareholders hereunder have been placed in custody,
for delivery under this Agreement, under a Custody Agreement made with Xxxxxxxx
X. Xxxx, as custodian ("Custodian"). Each such Selling Shareholder agrees that
the shares represented by the certificates held in custody for such Selling
Shareholder under such Custody Agreement are subject to the interests of the
Underwriters hereunder, that the arrangements made by such Selling Shareholders
for such custody are to that extent irrevocable, and that the obligations of
such Selling Shareholders hereunder shall not be terminated by operation of
law, whether by the death of any individual Selling Shareholder or the
occurrence of any other event, or in the case of a trust, by the death of any
trustee or trustees or the termination of such trust. If any individual Selling
Shareholder or any such trustee or trustees should
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die, or if any other such event should occur, or if any of such trusts should
terminate, before the delivery of the Offered Securities hereunder,
certificates for such Offered Securities shall be delivered by the Custodian in
accordance with the terms and conditions of this Agreement as if such death or
other event or termination had not occurred, regardless of whether or not the
Custodian shall have received notice of such death or other event or
termination.
The Company, the Custodian and the Selling Shareholders not a party to
the Custody Agreement will deliver the Firm Securities to the Representatives
for the accounts of the Underwriters against payment of the purchase price at a
bank acceptable to Credit Suisse First Boston Corporation ("CSFBC") in federal
reserve funds immediately available by wire transfer to the account of the
Company payable to the Company in the case of 2,600,000 shares of Firm
Securities, and in federal reserve funds immediately available by wire transfer
to the account of the Custodian, for the benefit of certain Selling
Shareholders, payable to the Custodian, in the case of 873,000 shares of Firm
Securities, at the office of Long Xxxxxxxx & Xxxxxx LLP, Atlanta, Georgia, at
10:00 A.M., Atlanta time, on ____________________, 1998, or at such other time
not later than seven full business days thereafter as CSFBC and the Company
determine, such time being herein referred to as the "First Closing Date." The
certificates for the Firm Securities so to be delivered will be in definitive
form, in such denominations and registered in such names as CSFBC requests and
will be made available for checking and packaging at the above office of Long
Xxxxxxxx & Xxxxxx LLP at least 24 hours prior to the First Closing Date.
In addition, upon written notice from CSFBC given to the Company from
time to time not more than 30 days subsequent to the date of the Prospectus,
the Underwriters may purchase all or less than all of the Optional Securities
at the purchase price per Security to be paid for the Firm Securities. The
Company agrees to sell to the Underwriters the number of shares of Optional
Securities specified in such notice and the Underwriters agree, severally and
not jointly, to purchase such Optional Securities. Such Optional Securities
shall be purchased for the account of each Underwriter in the same proportion
as the number of shares of Firm Securities set forth opposite such
Underwriter's name on Schedule A hereto bears to the total number of shares of
Firm Securities (subject to adjustment by CSFBC to eliminate fractions) and may
be purchased by the Underwriters only for the purpose of covering
over-allotments made in connection with the sale of the Firm Securities. No
Optional Securities shall be sold or delivered unless the Firm Securities
previously have been, or simultaneously are, sold and delivered. The right to
purchase the Optional Securities or any portion thereof may be exercised from
time to time and to the extent not previously exercised may be surrendered and
terminated at any time upon notice by CSFBC to the Company.
Each time for the delivery of and payment for the Optional Securities,
being herein referred to as an "Optional Closing Date," which may be the First
Closing Date (the First Closing Date and each Optional Closing Date, if any,
being sometimes referred to as a "Closing Date"), shall be determined by CSFBC
but shall be not later than five full business days after written notice of
election to purchase Optional Securities is given. The Company will deliver the
Optional Securities being purchased on each Optional Closing Date to the
Representatives for the accounts of the several Underwriters, against payment
of the purchase price therefor in federal reserve funds immediately available
by wire transfer to the account of the Company at a bank acceptable to CSFBC,
payable to the Company. The certificates for the Optional Securities being
purchased on each Optional
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Closing Date will be in definitive form, in such denominations and registered
in such names as CSFBC requests upon reasonable notice prior to such Optional
Closing Date and will be made available for checking and packaging at the above
office of Long Xxxxxxxx & Xxxxxx LLP at a reasonable time in advance of such
Optional Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Offered Securities for sale to the public as
set forth in the Prospectus.
5. Certain Agreements of the Company and the Selling Shareholders.
The Company agrees with the several Underwriters that:
(a) If the Effective Time of the Initial Registration Statement is
prior to the execution and delivery of this Agreement, the Company will file
the Prospectus with the Commission pursuant to and in accordance with
subparagraph (1) (or, if applicable and if consented to by CSFBC, subparagraph
(4)) of Rule 424(b) not later than the earlier of (A) the second business day
following the execution and delivery of this Agreement or (B) the 15th business
day after the Effective Date of the Initial Registration Statement. The Company
will advise CSFBC promptly of any such filing pursuant to Rule 424(b). If the
Effective Time of the Initial Registration Statement is prior to the execution
and delivery of this Agreement and an additional registration statement is
necessary to register a portion of the Offered Securities under the Act but the
Effective Time thereof has not occurred as of such execution and delivery, the
Company will file the additional registration statement or, if filed, will file
a post-effective amendment thereto with the Commission pursuant to and in
accordance with Rule 462(b) on or prior to 10:00 P.M., New York time, on the
date of this Agreement or, if earlier, on or prior to the time the Prospectus
is printed and distributed to any Underwriter, or will make such filing at such
later date as shall have been consented to by CSFBC.
(b) The Company will advise CSFBC promptly of any proposal to amend
or supplement the initial or any additional registration statement as filed or
the related Prospectus or the Initial Registration Statement, the Additional
Registration Statement (if any) or the Prospectus and will not effect such
amendment or supplementation without CSFBC's consent (which consent shall not
unreasonably be withheld); and the Company will also advise CSFBC promptly of
the effectiveness of each Registration Statement (if its Effective Time is
subsequent to the execution and delivery of this Agreement) and of any
amendment or supplementation of a Registration Statement or the Prospectus and
of the institution by the Commission of any stop order proceedings in respect
of a Registration Statement and will use its best efforts to prevent the
issuance of any such stop order and to obtain as soon as possible its lifting,
if issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with sales
by any Underwriter or dealer, the Company becomes aware of the occurrence of
any event as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or the Company
becomes aware that if it is necessary at any time to amend or supplement the
Prospectus to comply with the Act, the Company will promptly notify
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CSFBC of such event and will promptly prepare and file with the Commission, at
its own expense, an amendment or supplement which will correct such statement
or omission or an amendment which will effect such compliance. Neither CSFBC's
consent to, nor the Underwriters' delivery of, any such amendment or supplement
shall constitute a waiver of any of the conditions set forth in Section 6.
(d) As soon as practicable, but not later than the Availability Date
(as defined below), the Company will make generally available to its security
holders an earnings statement covering a period of at least 12 months beginning
after the Effective Date of the Initial Registration Statement (or, if later,
the Effective Date of the Additional Registration Statement) which will satisfy
the provisions of Section 11(a) of the Act. For the purpose of the preceding
sentence, "Availability Date" means the 45th day after the end of the fourth
fiscal quarter following the fiscal quarter that includes such Effective Date,
except that, if such fourth fiscal quarter is the last quarter of the Company's
fiscal year, "Availability Date" means the 90th day after the end of such
fourth fiscal quarter.
(e) The Company will furnish to the Representatives copies of each
Registration Statement (four of which will be signed and will include all
exhibits), each related preliminary prospectus, and, so long as a prospectus
relating to the Offered Securities is required to be delivered under the Act in
connection with sales by any Underwriter or dealer, the Prospectus and all
amendments and supplements to such documents, in each case in such quantities
as CSFBC reasonably requests. The Prospectus shall be so furnished on or prior
to 3:00 P.M., New York time, on the business day following the later of the
execution and delivery of this Agreement or the Effective Time of the Initial
Registration Statement. All other documents shall be so furnished as soon as
available. The Company will pay the expenses of printing and distributing to
the Underwriters all such documents.
(f) The Company will arrange for the qualification of the Offered
Securities for sale under the laws of such jurisdictions as CSFBC designates
and will continue such qualifications in effect so long as required to complete
the distribution of the Offered Securities; provided that the Company shall not
be required to register as a foreign corporation or generally be subject to
service of process in such jurisdictions as a result of such qualification.
(g) During the period of five years hereafter, the Company will
furnish to the Representatives and, upon request, to each of the other
Underwriters, as soon as practicable after the end of each fiscal year, a copy
of its annual report to shareholders for such year; and the Company will
furnish to the Representatives (i) as soon as available, a copy of each report
and any definitive proxy statement of the Company filed with the Commission
under the Securities Exchange Act of 1934, as amended, or mailed to
shareholders, and (ii) from time to time, such other information concerning the
Company as CSFBC may reasonably request.
(h) For a period of 180 days after the date of the Prospectus, the
Company and its officers and directors will not offer, sell, contract to sell,
announce their intention to sell, loan, pledge, grant any rights with respect
to or otherwise dispose of, directly or indirectly, or publicly disclose the
intention to make any such offer, sale, loan, pledge, grant or disposal or, in
the case of the Company,
12
file with the Commission a registration statement under the Act relating to any
additional shares of their Securities or securities convertible into or
exchangeable or exercisable for any shares of their Securities, without the
prior written consent of CSFBC, except for issuances of Securities pursuant to
the exercise of employee stock options outstanding on the date hereof and
except for a registration statement on Form S-8 registering shares of
Securities to be issued under the Company's Stock Incentive Plan.
Notwithstanding the foregoing, officers and directors of the Company shall be
permitted to transfer shares of their Securities or other securities
convertible into or exchangeable or exercisable for Securities of which such
officers and directors are currently the beneficial owner to:
(i) the Company;
(ii) shareholders of the Company who are bound by the terms
of a lock-up agreement substantially similar to that executed by the
transferor as if such person were an original party thereto; and
(iii) any donee(s) of the officers and directors of the
Company who receive such securities of the Company as a bona fide gift
or any "affiliate" of the undersigned (within the meaning of Rule 144
of the Act), provided that such donee(s) or affiliate(s) agree in
writing to be bound by the restrictions contained in a lock-up
agreement substantially similar to that executed by the donor or
transferor as if such donee or transferee were an original party
thereto.
The Company and each Selling Shareholder, severally and not jointly,
agree with the several Underwriters that the Company will pay all expenses
incident to the performance of the obligations of the Company and such Selling
Shareholders, as the case may be (except for the underwriting discounts and
commissions payable with respect to the Selling Shareholders' respective shares
sold in the Offering, which each Selling Shareholder will bear in proportion to
the amount sold by such Selling Shareholder), under this Agreement, for any
filing fees and other expenses (including fees and disbursements of counsel not
to exceed $12,500) incurred in connection with qualification of the Offered
Securities for sale under the laws of such jurisdictions as CSFBC designates
and the printing of memoranda relating thereto, for the filing fee of the
National Association of Securities Dealers, Inc. relating to the Offered
Securities, for any travel expenses of the Company's officers, directors and
employees and any other expenses of the Company in connection with attending or
hosting meetings with prospective purchasers of the Offered Securities, for any
transfer taxes on the sale by the Selling Shareholders of the Offered
Securities to the Underwriters and for expenses incurred in distributing
preliminary prospectuses and the Prospectus (including any amendments and
supplements thereto) to the Underwriters.
Each Selling Shareholder agrees to deliver to CSFBC, attention:
Transactions Advisory Group, on or prior to the First Closing Date a properly
completed and executed United States Treasury Department Form W-9 (or other
applicable form or statement specified by Treasury Department regulations in
lieu thereof).
13
Each Selling Shareholder agrees, for a period of 180 days after the
date of the Prospectus, not to offer, sell, contract to sell, loan, pledge,
grant any rights with respect to or otherwise dispose of, directly or
indirectly, any additional shares of the Securities of the Company or
securities convertible into or exchangeable or exercisable for any shares of
Securities, or publicly disclose the intention to make any such offer, sale,
loan, pledge, grant or disposal, without the prior written consent of CSFBC.
6. Conditions to the Obligations of the Underwriters. The
obligations of the several Underwriters to purchase and pay for the Firm
Securities on the First Closing Date and the Optional Securities to be
purchased on each Optional Closing Date will be subject to the accuracy of the
representations and warranties on the part of the Company and the Selling
Shareholders herein, to the accuracy of the statements of Company officers made
pursuant to the provisions hereof, to the performance by the Company and the
Selling Shareholders of their obligations hereunder and to the following
additional conditions precedent:
(a) The Representatives shall have received a letter, dated the date
of delivery thereof (which, if the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement, shall be on
or prior to the date of this Agreement or, if the Effective Time of the Initial
Registration Statement is subsequent to the execution and delivery of this
Agreement, shall be prior to the filing of the amendment or post-effective
amendment to the registration statement to be filed shortly prior to such
Effective Time), of Coopers & Xxxxxxx, L.L.P., confirming that they are
independent public accountants within the meaning of the Act and the applicable
published Rules and Regulations thereunder and stating to the effect that:
(i) in their opinion the financial statements and
schedules examined by them and included in the Registration Statements
comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published Rules and
Regulations;
(ii) on the basis of a reading of the latest available
interim financial statements of the Company, inquiries of officials of
the Company who have responsibility for financial and accounting
matters and other specified procedures, nothing came to their
attention that caused them to believe that:
(A) at the date of the latest available balance sheet
read by such accountants, or at a subsequent specified date
not more than three days prior to the date of this Agreement,
there was any change in the capital stock or any increase in
short-term indebtedness or long-term debt of the Company and
its consolidated subsidiaries or, at the date of the latest
available balance sheet read by such accountants, there was
any decrease in consolidated net current assets or
consolidated net assets, as compared with amounts shown on
the latest balance sheet included in the Prospectus;
(B) for the period from the closing date of the
latest income statement included in the Prospectus to the
closing date of the latest available income statement
14
read by such accountants there were any decreases, as
compared with the corresponding period of the previous year,
and with the period of corresponding length ended the date of
the latest income statement included in the Prospectus, in
consolidated net sales or consolidated net operating income
or in the total or per share amounts of consolidated income
before extraordinary items or net income; or
(C) any unaudited pro forma financial statements
included in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements
of the Act and the related published Rules and Regulations or
the pro forma adjustments have not been properly applied to
the historical amounts in the compilation of those
statements;
except in all cases set forth in clauses (A), (B) and (C) above for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(iii) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other financial and
statistical information contained in the Registration Statements (in
each case to the extent that such dollar amounts, percentages and
other financial and statistical information are derived from the
general accounting records of the Company and its subsidiaries subject
to the internal controls of the Company's accounting system or are
derived directly from such records by analysis or computation) with
the results obtained from inquiries, a reading of such general
accounting records and other procedures specified in such letter and
have found such dollar amounts, percentages and other financial and
statistical information to be in agreement with such results, except
as otherwise specified in such letter.
For purposes of this subsection, (i) if the Effective Time of the
Initial Registration Statement is subsequent to the execution and delivery of
this Agreement, "Registration Statements" shall mean the initial registration
statement as proposed to be amended by the amendment or post-effective
amendment to be filed shortly prior to its Effective Time, (ii) if the
Effective Time of the Initial Registration Statement is prior to the execution
and delivery of this Agreement but the Effective Time of the Additional
Registration Statement is subsequent to such execution and delivery,
"Registration Statements" shall mean the Initial Registration Statement and the
additional registration statement as proposed to be filed or as proposed to be
amended by the post-effective amendment to be filed shortly prior to its
Effective Time, and (iii) "Prospectus" shall mean the prospectus included in
the Registration Statements.
(b) If the Effective Time of the Initial Registration Statement is
not prior to the execution and delivery of this Agreement, such Effective Time
shall have occurred not later than 10:00 P.M., New York time, on the date of
this Agreement or such later date as shall have been consented to by CSFBC. If
the Effective Time of the Additional Registration Statement (if any) is not
prior to the execution and delivery of this Agreement, such Effective Time
shall have occurred not later than 10:00 P.M., New York time, on the date of
this Agreement or, if earlier, the time the Prospectus is printed and
distributed to any Underwriter, or shall have occurred at such later date as
shall have
15
been consented to by CSFBC. If the Effective Time of the Initial Registration
Statement is prior to the execution and delivery of this Agreement, the
Prospectus shall have been filed with the Commission in accordance with the
Rules and Regulations and Section 5(a) of this Agreement. Prior to such Closing
Date, no stop order suspending the effectiveness of a Registration Statement
shall have been issued and no proceedings for that purpose shall have been
instituted or, to the knowledge of any Selling Shareholder, the Company or the
Representatives, shall be contemplated by the Commission.
(c) Subsequent to the execution and delivery by the Company of this
Agreement, there shall not have occurred (i) any change, or any development or
event involving a prospective change, in the condition (financial or
otherwise), business, properties or results of operations of the Company or its
subsidiaries which, in the judgment of a majority in interest of the
Underwriters including the Representatives, would have a Material Adverse
Effect and makes it impractical or inadvisable to proceed with completion of
the public offering or the sale of and payment for the Offered Securities; (ii)
any downgrading in the rating of any debt securities of the Company by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Act), or any public announcement that any
such organization has under surveillance or review its rating of any debt
securities of the Company (other than an announcement with positive
implications of a possible upgrading, and no implication of a possible
downgrading, of such rating); (iii) any suspension or limitation of trading in
securities generally on the New York Stock Exchange or any setting of minimum
prices for trading on such exchange, or any suspension of trading of any
securities of the Company on any exchange or in the over-the-counter market;
(iv) any banking moratorium declared by U.S. Federal or New York authorities;
or (v) any outbreak or escalation of major hostilities in which the United
States is involved, any declaration of war by Congress or any other substantial
national or international calamity or emergency if, in the judgment of a
majority in interest of the Underwriters including the Representatives, the
effect of any such outbreak, escalation, declaration, calamity or emergency
makes it impractical or inadvisable to proceed with completion of the public
offering or the sale of and payment for the Offered Securities.
(d) The Representatives shall have received an opinion, dated such
Closing Date, of King & Spalding, counsel for the Company, to the effect that:
(i) The Company has been duly incorporated and is an
existing corporation in good standing under the laws of the State of
Georgia, with corporate power and authority to own its properties and
conduct its business as described in the Prospectus; and the Company
is duly qualified to do business as a foreign corporation in good
standing in all other jurisdictions in which its ownership or lease of
property or the conduct of its business requires such qualification
except where the failure to do so would not have a Material Adverse
Effect.
(ii) Each of the subsidiaries of the Company has been duly
incorporated and is an existing corporation in good standing under the
laws of its respective state of incorporation, with corporate power
and authority to own its properties and conduct its business as
described in the Prospectus; and each of such subsidiaries is duly
qualified to do business as a foreign corporation in good standing in
all other jurisdictions in which its
16
ownership or lease of property or the conduct of its business requires
such qualification except where the failure to do so would not have a
Material Adverse Effect.
(iii) The Offered Securities delivered on such Closing
Date and all other outstanding shares of the Securities of the Company
have been duly authorized and validly issued, are fully paid and
nonassessable and conform to the description thereof contained in the
Prospectus; and the Shareholders of the Company have no preemptive
rights with respect to the Offered Securities; and to the knowledge of
such counsel, there are no other rights to subscribe for or purchase
any shares of capital stock issued by the Company and (except as
described in the Prospectus) no outstanding securities or obligations
of the Company convertible into, exercisable for or exchangeable for
any capital stock of the Company.
(iv) To the knowledge of such counsel, no person or entity
has any right, not effectively satisfied or waived, to require the
Company to file a registration statement under the Act with respect to
any securities of the Company owned or to be owned by such person or
to require the Company to include such securities in the securities
registered pursuant to a Registration Statement or in any securities
being registered pursuant to a Registration Statement or in any
securities being registered pursuant to any other registration
statement filed by the Company under the Act, other than in connection
with any registration statement on Form S-8 under the Act to register
all shares of Securities subject to outstanding options and future
grants under the Company's Stock Incentive Plan.
(v) The Company is not and, after giving effect to the
offering and sale of the Offered Securities and the application of the
proceeds thereof as described in the Prospectus, will not be an
"investment company" as defined in the Investment Company Act of 1940.
(vi) No consent, approval, authorization or order of, or
filing with, any governmental agency or body or, to the knowledge of
such counsel, any court is required to be obtained or made by the
Company or any Selling Shareholder for the consummation of the
transactions contemplated by this Agreement or the Custody Agreement
in connection with the sale of the Offered Securities, except such as
have been obtained and made under the Act and such as may be required
by the NASD or under state securities laws.
(vii) The execution, delivery and performance of this
Agreement or the Custody Agreement and the consummation of the
transactions herein or therein contemplated will not result in a
breach or violation of any of the terms and provisions of, or
constitute a default under, any statute, any rule, regulation or order
of any governmental agency or body or, to the knowledge of such
counsel, any court having jurisdiction over the Company or any
subsidiary of the Company or any of their properties, the charter or
by-laws of the Company or any such subsidiary or, to the knowledge of
such counsel, any other material agreement or instrument to which the
Company or any such subsidiary is a party or by which the Company or
any such subsidiary is bound or to which any of the properties of the
Company or any such subsidiary is subject.
17
(viii) The Initial Registration Statement was declared
effective under the Act as of the date and time specified in such
opinion, the Additional Registration Statement (if any) was filed and
became effective under the Act as of the date and time (if
determinable) specified in such opinion, the Prospectus either was
filed with the Commission pursuant to the subparagraph of Rule 424(b)
specified in such opinion on the date specified therein or was
included in the Initial Registration Statement or the Additional
Registration Statement (as the case may be), and, to the best of the
knowledge of such counsel, no stop order suspending the effectiveness
of a Registration Statement or any part thereof has been issued and no
proceedings for that purpose have been instituted or are pending or
contemplated under the Act, and each Registration Statement and the
Prospectus, and each amendment or supplement thereto, as of their
respective effective or issue dates, complied as to form in all
material respects with the requirements of the Act and the Rules and
Regulations.
(ix) This Agreement has been duly authorized, executed and
delivered by the Company, is the legal, valid and binding obligation
of the Company, and is enforceable as to the Company in accordance
with its terms, except insofar as indemnification and contribution
provisions may be limited by applicable law or equitable principles,
and except as enforceability may be limited by bankruptcy,
reorganization, moratorium or similar laws affecting the
enforceability of creditors' rights generally and rules of law
governing specific performance, injunctive relief and other equitable
remedies.
(x) The statements in the Registration Statement and the
Prospectus under the captions "Risk Factors--Limitations on
Third-Party Reimbursement," "--Government Regulation" and "--Limited
Manufacturing Experience," "Business--Manufacturing," "-- Government
Regulation" and "--Healthcare Reform; Third-Party Reimbursement,"
"Description of Capital Stock" and "Shares Eligible For Future Sale,"
insofar as they are descriptions of laws, regulations and rules, of
legal and governmental proceedings or of contracts, agreements,
leases, licenses and other legal documents known to such counsel, or
refer to statements of law or legal conclusions, are complete and
accurate in all material respects.
(xi) The Company and each of its subsidiaries have such
permits, licenses, franchises and authorizations of governmental or
regulatory authorities of the United States and the European Union
having jurisdiction over the business of the Company and its
subsidiaries (collectively the "Licenses") as are necessary to own
their properties and conduct their business in the manner described in
the Prospectus; and to the best of such counsel's knowledge, the
Company and each of its subsidiaries have fulfilled and performed all
of their material, respective obligations with respect to the Licenses
and no event has occurred which allows, or after notice or lapse of
time would allow, revocation or termination thereof or result in any
other material impairment that could have a Material Adverse Effect
which is not described in the Prospectus.
(xii) The Company or one of its subsidiaries is the
exclusive owner of, and has sole, full and clear title to, the
registrations for the trademarks registered by the Company or its
subsidiaries that are listed on Schedule A to such opinion (the
"Trademarks") currently
18
registered in the United States Patent and Trademark Office (the
"PTO") and the foreign equivalents thereof in the countries listed on
Schedule A, which Trademarks are the only trademarks that are
necessary for the Company and its subsidiaries to conduct their
business in the manner described in the Prospectus, free and clear of
any encumbrances, liens or adverse claims of any kind, and all of the
registrations of said Trademarks are valid and subsisting in the
records of the PTO and the foreign countries listed on Schedule A.
(xiii) To such counsel's knowledge, the Company's and its
subsidiaries' present use of the Trademarks does not infringe on any
rights of third parties, and there are no third parties infringing on
or otherwise interfering with the use of the Trademarks. Such counsel
is not aware of any adverse claims with respect to any of the
Trademarks.
(xiv) The Company or one of its subsidiaries has sole, full
and clear title to, the patents that are listed on Schedule B to such
opinion (the "Patents"), and such Patents are properly recorded with
the PTO and the foreign equivalents thereof in the countries listed on
Schedule B. All maintenance fees with respect to the Patents have been
paid, the Patents are validly assigned to the Company or one of its
subsidiaries, and the Patents are in full force and effect. To such
counsel's knowledge, there has been no express abandonment or
dedication to the public with respect to any of the Patents, and there
are no invalidating or limiting court decisions with respect to any of
the Patents.
(xv) The Company or one of its subsidiaries has a legal
and valid right to the use of the patents listed on Schedule C to such
opinion (the "Licensed Patents"), the rights to which are licensed to
the Company or its subsidiaries, and such Licensed Patents, to such
counsel's knowledge, are properly recorded with the PTO and the
foreign equivalents thereof in the countries listed on Schedule C, are
validly assigned by the licensors of such Licensed Patents and are in
full force and effect.
(xvi) Except as described in the Prospectus, there are no
legal or governmental proceedings, investigations or inquiries pending
or, to the best of such counsel's knowledge, threatened before any
governmental, regulatory or administrative authority having
jurisdiction over the business of the Company and its subsidiaries or
their respective properties, other than such as may be incident to the
kind of business conducted by the Company and its subsidiaries and
which individually or in the aggregate would not, if adversely
determined against the Company or any of its subsidiaries, have a
Material Adverse Effect.
In addition, such counsel shall state that it has
participated in conferences with officers and other representatives of
the Company, representatives of the independent public accountants for
the Company and the Representatives and counsel to the Underwriters at
which the contents of the Registration Statement and Prospectus and
related matters were discussed and, although such counsel has not
undertaken to investigate or verify independently and does not assume
any responsibility for, the accuracy, completeness or fairness of the
statements contained in the Registration Statement and Prospectus
(except as otherwise expressly set forth herein), on the basis of the
foregoing, no facts have come to
19
such counsel's attention that caused such counsel to believe that any
part of the Registration Statement (other than the financial
statements and notes thereto and other financial, statistical and
accounting data or schedules included therein, or omitted therefrom,
as to which such counsel need express no opinion), as amended or
supplemented, at the time such part of the Registration Statement
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 the
Prospectus (other than the financial statements and notes thereto and
other financial, statistical and accounting data or schedules included
therein, or omitted therefrom, as to which such counsel expresses no
opinion), as amended or supplemented, on the date of filing thereof
with the Commission and on the date hereof, contained an untrue
statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which such statements were made, not misleading.
In rendering such opinion, counsel for the Company may rely
as to matters contained in clauses (xii), (xiii), (xiv) and (xv) of
Section 6(d) as they relate to Strato/Infusaid Inc. on the legal
opinion of Needle & Xxxxxxxxx, P.C., in which case counsel for the
Company shall state that the opinion of such other counsel is
satisfactory in scope, form and substance to counsel for the Company.
(e) The Representatives shall have received an opinion, dated the
First Closing Date and, if applicable, each Optional Closing Date, of King &
Spalding, counsel for the Selling Shareholders, to the effect that:
(i) Each Selling Shareholder has valid and unencumbered
title to the Offered Securities delivered by such Selling Shareholder
on such Closing Date and has full right, power and authority to sell,
assign, transfer and deliver the Offered Securities delivered by such
Selling Shareholder on the First Closing Date hereunder; and the
several Underwriters have acquired valid and unencumbered title to the
Offered Securities purchased by them from the Selling Shareholders on
the First Closing Date hereunder;
(ii) No consent, approval, authorization or order of, or
filing with, any governmental agency or body or any court is required
to be obtained or made by any Selling Shareholder for the consummation
of the transactions contemplated by the Custody Agreement, the
Irrevocable Power of Attorney of each Selling Shareholder who is a
party thereto (the "Power of Attorney"), or this Agreement in
connection with the sale of the Offered Securities sold by the Selling
Shareholders, except such as have been obtained and made under the Act
and such as may be required under state securities laws;
(iii) The execution, delivery and performance of the
Custody Agreement, the Power of Attorney and this Agreement and the
consummation of the transactions therein and herein contemplated will
not result in a breach or violation of any of the terms and provisions
of, or constitute a default under, any statute, any rule, regulation
or order of any governmental agency or body or any court having
jurisdiction over any Selling Shareholder or any of their properties
or any agreement or instrument to which any Selling Shareholder
20
is a party or by which any Selling Shareholder is bound or to which
any of the properties of any Selling Shareholder is subject, or the
charter or by-laws of any Selling Shareholder which is a corporation;
and
(iv) This Agreement and, as applicable, the Power of Attorney
and related Custody Agreement with respect to each Selling Shareholder
has been duly authorized, executed and delivered by such Selling
Shareholder and constitute valid and legally binding obligations of
each such Selling Shareholder enforceable in accordance with their
terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
(f) The Representatives shall have received from Long Xxxxxxxx &
Xxxxxx LLP, counsel for the Underwriters, such opinion or opinions, dated such
Closing Date, with respect to the incorporation of the Company, the validity of
the Offered Securities delivered on such Closing Date, the Registration
Statements, the Prospectus and other related matters as the Representatives may
require, and the Selling Shareholders and the Company shall have furnished to
such counsel such documents as they may reasonably request for the purpose of
enabling them to pass upon such matters.
(g) The Representatives shall have received a certificate, dated
such Closing Date, of the President or any Vice President and a principal
financial or accounting officer of the Company in which such officers, to the
best of their knowledge after reasonable investigation, shall state that: the
representations and warranties of the Company in this Agreement are true and
correct; the Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied hereunder at or prior to
such Closing Date; no stop order suspending the effectiveness of any
Registration Statement has been issued and no proceedings for that purpose have
been instituted or are contemplated by the Commission; the Additional
Registration Statement (if any) satisfying the requirements of subparagraphs
(1) and (3) of Rule 462(b) was filed pursuant to Rule 462(b), including payment
of any applicable filing fee in accordance with Rule 111(a) or (b) under the
Act, prior to the time the Prospectus was printed and distributed to any
Underwriter; and, subsequent to the dates of the most recent financial
statements in the Prospectus, there has been no material adverse change, nor
any development or event likely to result in a material adverse change, in the
condition (financial or otherwise), business, properties or results of
operations of the Company and its subsidiaries taken as a whole except as set
forth in or contemplated by the Prospectus or as described in such certificate.
(h) The Representatives shall have received a letter, dated such
Closing Date, of Coopers & Xxxxxxx L.L.P. which meets the requirements of
subsection (a) of this Section, except that the specified date referred to in
such subsection will be a date not more than three days prior to such Closing
Date for the purposes of this subsection.
(i) The Selling Shareholders shall have executed and delivered this
Agreement.
21
The Selling Shareholders and the Company will furnish the Representatives with
such conformed copies of such opinions, certificates, letters and documents as
the Representatives reasonably request. CSFBC may in its sole discretion waive
on behalf of the Underwriters compliance with any conditions to the obligations
of the Underwriters hereunder, whether in respect of an Optional Closing Date
or otherwise.
7. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in any Registration Statement, the Prospectus,
or any amendment or supplement thereto, or any related preliminary prospectus,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse each Underwriter for any
legal or other expenses reasonably incurred by such Underwriter in connection
with investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred; provided, however, that the Company will
not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or alleged
untrue statement in or omission or alleged omission from any of such documents
in reliance upon and in conformity with written information furnished to the
Company by any Underwriter through the Representatives specifically for use
therein, it being understood and agreed that the only such information
furnished by any Underwriter consists of the information described as such in
subsection (c) below; and provided, further, that such indemnity with respect
to any untrue statement or omission of a material fact contained in any
preliminary prospectus, shall not inure to the benefit of any Underwriter from
whom the person asserting any such losses, claims, damages or liabilities
purchased the shares that are subject thereof if such person did not receive a
copy of the Prospectus (or the Prospectus as supplemented) at or prior to the
confirmation of the sale of such shares to such person in any case where
delivery is required under the Act and such untrue statement or omission of a
material fact contained in any preliminary prospectus was corrected in the
Prospectus (or the Prospectus as supplemented).
(b) The Selling Shareholders, jointly and severally, will indemnify
and hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
any Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading
(in each case only to the extent that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company or any Underwriter
by the Selling Shareholders specifically for use therein), and will reimburse
each Underwriter for any legal or other expenses reasonably incurred by such
Underwriter
22
in connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred; provided, however, that the
Selling Shareholders will not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement in or omission or alleged omission from
any of such documents in reliance upon and in conformity with written
information furnished to the Company by an Underwriter through the
Representatives specifically for use therein, it being understood and agreed
that the only such information furnished by any Underwriter consists of the
information described as such in subsection (c) below; and provided, further,
that such indemnity with respect to any untrue statement or omission of a
material fact contained in any preliminary prospectus, shall not inure to the
benefit of any Underwriter from whom the person asserting any such losses,
claims, damages or liabilities purchased the shares that are subject thereof if
such person did not receive a copy of the Prospectus (or the Prospectus as
supplemented) at or prior to the confirmation of the sale of such shares to
such person in any case where delivery is required under the Act and such
untrue statement or omission of a material fact contained in any preliminary
prospectus was corrected in the Prospectus (or the Prospectus as supplemented).
(c) Each Underwriter will severally and not jointly indemnify and
hold harmless the Company and each Selling Shareholder against any losses,
claims, damages or liabilities to which the Company or such Selling Shareholder
may become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in any Registration Statement, the Prospectus, or any amendment
or supplement thereto, or any related preliminary prospectus, or arise out of
or are based upon the omission or the alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through the Representatives
specifically for use therein, and will reimburse any legal or other expenses
reasonably incurred by the Company and any Selling Shareholder in connection
with investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred, it being understood and agreed that the
only such information furnished by any Underwriter consists of (i) the
following information in the Prospectus furnished on behalf of each
Underwriter: the last paragraph at the bottom of the cover page of the
Prospectus concerning the terms of the offering by the Underwriters, the legend
concerning over-allotments and stabilizing on the inside front cover page and
the concession and reallowance figures appearing in the fourth paragraph under
the caption "Underwriting" and the information contained in the fifth paragraph
under the caption "Underwriting"; and (ii) the disclosure in the last paragraph
under the caption "Underwriting" that NationsCredit Commercial Corporation is
an indirect subsidiary of NationsBank Corporation, which is the parent
corporation of NationsBanc Xxxxxxxxxx Securities LLC.
(d) Promptly after receipt by an indemnified party under this
Section or Section 9 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party under subsection (a), (b) or (c) above or Section 9, notify
the indemnifying party of the commencement thereof; but the omission so to
notify the indemnifying party will not relieve it from any liability which it
may have to any indemnified party
23
otherwise than under subsection (a), (b) or (c) above or Section 9. In case any
such action is brought against any indemnified party and it notifies an
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the
indemnifying party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
Section or Section 9, as the case may be, for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement includes an
unconditional release of such indemnified party from all liability on any
claims that are the subject matter of such action. The indemnifying party shall
not be liable for settlements effected without its prior written consent, which
shall not be unreasonably withheld.
(e) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a), (b) or (c) above, then each indemnifying party shall contribute
to the amount paid or payable by such indemnified party as a result of the
losses, claims, damages or liabilities referred to in subsection (a), (b) or
(c) above (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Selling Shareholders on the one hand
and the Underwriters on the other hand from the offering of the Securities or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault
of the Company and the Selling Shareholders on the one hand and the
Underwriters on the other hand in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities as well as any
other relevant equitable considerations. The relative benefits received by the
Company and the Selling Shareholders on the one hand and the Underwriters on
the other hand shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) received by the Company
and the Selling Shareholders bear to the total underwriting discounts and
commissions received by the Underwriters. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by the Company, the
Selling Shareholders or the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The amount paid by an indemnified party as a
result of the losses, claims, damages or liabilities referred to in the first
sentence of this subsection (e) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim which is the subject of this
subsection (e). Notwithstanding the provisions of this subsection (e), no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent
24
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection (e) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(f) The obligations of the Company and the Selling Shareholders
under this Section or Section 9 shall be in addition to any liability which the
Company and the Selling Shareholders may otherwise have and shall extend, upon
the same terms and conditions, to each person, if any, who controls any
Underwriter or the QIU (as such term is defined in Section 9) within the
meaning of the Act; and the obligations of the Underwriters under this Section
shall be in addition to any liability which the respective Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to each
director of the Company, to each officer of the Company who has signed the
Registration Statement and to each person, if any, who controls the Company
within the meaning of the Act.
8. Default of Underwriters. If any Underwriter or Underwriters
default in their obligations to purchase Offered Securities hereunder on any
Closing Date and the aggregate number of shares of Offered Securities that such
defaulting Underwriter or Underwriters agreed but failed to purchase does not
exceed 10% of the total number of shares of Offered Securities that the
Underwriters are obligated to purchase on such Closing Date, CSFBC may make
arrangements satisfactory to the Company and the Selling Shareholders for the
purchase of such Offered Securities by other persons, including any of the
Underwriters, but if no such arrangements are made by such Closing Date, the
non-defaulting Underwriters shall be obligated severally, in proportion to
their respective commitments hereunder, to purchase the Offered Securities that
such defaulting Underwriters agreed but failed to purchase on such Closing
Date. If any Underwriter or Underwriters so default and the aggregate number of
shares of Offered Securities with respect to which such default or defaults
occur exceeds 10% of the total number of shares of Offered Securities that the
Underwriters are obligated to purchase on such Closing Date and arrangements
satisfactory to CSFBC, the Company and the Selling Shareholders for the
purchase of such Offered Securities by other persons are not made within 36
hours after such default, this Agreement will terminate without liability on
the part of any non-defaulting Underwriter, the Company or the Selling
Shareholders, except as provided in Section 10 (provided that if such default
occurs with respect to Optional Securities after the First Closing Date, this
Agreement will not terminate as to the Firm Securities or any Optional
Securities purchased prior to such termination). As used in this Agreement, the
term "Underwriter" includes any person substituted for an Underwriter under
this Section. Nothing herein will relieve a defaulting Underwriter from
liability for its default.
9. Qualified Independent Underwriter. The Company hereby confirms
that at its request CSFBC has without compensation acted as "qualified
independent underwriter" (in such capacity, the "QIU") within the meaning of
Rule 2710 of the Conduct Rules of the National Association of Securities
Dealers, Inc. in connection with the offering of the Offered Securities. The
Company and the Selling Shareholders will severally and not jointly indemnify
and hold harmless the QIU against any losses, claims, damages or liabilities,
joint or several, to which the QIU may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon the QIU's acting (or alleged
failing to act) as such "qualified
25
independent underwriter" and will reimburse the QIU for any legal or other
expenses reasonably incurred by the QIU in connection with investigating or
defending any such loss, claim, damage, liability or action as such expenses
are incurred; provided, however, that each Selling Shareholder shall only be
subject to liability under this Section to the extent such liability arises out
of or is based upon any untrue statement or alleged untrue statement or upon an
omission or alleged omission based upon information provided by such Selling
Shareholder or contained in a representation or warranty given by such Selling
Shareholder in this Agreement, the Power of Attorney or the Custody Agreement.
10. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements of the Selling Shareholders, of the Company or its officers, and of
the several Underwriters set forth in or made pursuant to this Agreement will
remain in full force and effect, regardless of any investigation, or statement
as to the results thereof, made by or on behalf of any Underwriter, any Selling
Shareholder, the Company or any of their respective representatives, officers
or directors or any controlling person, and will survive delivery of and
payment for the Offered Securities. If this Agreement is terminated pursuant to
Section 8 or if for any reason the purchase of the Offered Securities by the
Underwriters is not consummated, the Company and the Selling Shareholders shall
remain responsible for the expenses to be paid or reimbursed by them pursuant
to Section 5 and the respective obligations of the Company, the Selling
Shareholders and the Underwriters pursuant to Section 7 and the obligations of
the Company and the Selling Shareholders pursuant to Section 9 shall remain in
effect, and if any Offered Securities have been purchased hereunder the
representations and warranties in Section 2 and all obligations under Section 5
shall also remain in effect. If the purchase of the Offered Securities by the
Underwriters is not consummated for any reason other than solely because of the
termination of this Agreement pursuant to Section 8 or the occurrence of any
event specified in clause (iii), (iv) or (v) of Section 6(c), the Company will
reimburse the Underwriters for all out-of-pocket expenses (including fees and
disbursements of counsel) reasonably incurred by them in connection with the
offering of the Offered Securities.
11. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed or delivered and confirmed to the
Representatives, c/o Credit Suisse First Boston Corporation, Eleven Madison
Avenue, New York, N.Y. 10010-3629, Attention: Investment Banking Department -
Transactions Advisory Group, with a copy to Long Xxxxxxxx & Xxxxxx LLP, 000
Xxxxxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxxxx, 00000, Attention: Xxxxxxx X.
Xxxxxxxxxxx, Esq., or, if sent to the Company, will be mailed or delivered and
confirmed to it at Xxx Xxxxxxx Xxx, X.X. Xxxxxx 000, Xxxxxxxxxx, Xxxxxxx,
00000, Attention: Xxxxxxxx X. Xxxx, with a copy to King & Spalding, 000
Xxxxxxxxx Xxxxxx, X.X., Xxxxxxx, Xxxxxxx, 00000-0000, Attention: Xxxxxxx X.
Xxxxx, Esq., or, if sent to the Selling Shareholders or any of them, will be
mailed or delivered and confirmed to ____________ at __________________, with a
copy to ________ at _______________; provided, however, that any notice to an
Underwriter pursuant to Section 7 will be mailed or delivered and confirmed to
such Underwriter.
12. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective personal representatives
and successors and the officers and
26
directors and controlling persons referred to in Section 7, and no other person
will have any right or obligation hereunder.
13. Representation. The Representatives will act for the several
Underwriters in connection with the transactions contemplated by this
Agreement, and any action under this Agreement taken by the Representatives,
jointly or by CSFBC, will be binding upon all the Underwriters. Xxxxxxxx X.
Xxxx will act for certain of the Selling Shareholders in connection with such
transactions, and any action under or in respect of this Agreement taken by Xx.
Xxxx will be binding upon all such Selling Shareholders.
14. 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.
15. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAWS.
The Company and the Selling Shareholders hereby submit to the
non-exclusive jurisdiction of the Federal and state courts in the Borough of
Manhattan in The City of New York in any suit or proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby.
27
If the foregoing is in accordance with the Representatives'
understanding of our agreement, kindly sign and return to the Company four
counterparts hereof, whereupon this Agreement will become a binding agreement
among the Selling Shareholders, the Company and the several Underwriters in
accordance with its terms.
Very truly yours,
THE SELLING SHAREHOLDERS:
NATIONSCREDIT COMMERCIAL CORPORATION
By:
----------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
XXXXXXX CAPITAL PARTNERS, L.P. -
ENHANCED APPRECIATION
By:
----------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
-------------------------------------------
Xxxxx X. X. Xxxxx
THE COMPANY:
HORIZON MEDICAL PRODUCTS, INC.
By:
----------------------------------------
Name:
-----------------------------------
Title:
----------------------------------
28
The foregoing Underwriting Agreement is hereby
confirmed and accepted as of the date first above
written.
CREDIT SUISSE FIRST BOSTON CORPORATION
BANCAMERICA XXXXXXXXX XXXXXXXX
NATIONSBANC XXXXXXXXXX SECURITIES LLC
Acting on behalf of themselves and as the
Representatives of the several
Underwriters.
By CREDIT SUISSE FIRST BOSTON CORPORATION
By:
-------------------------------------------------
Name:
-------------------------------------------
Title:
-------------------------------------------
29
SCHEDULE A
TOTAL NUMBER OF
NUMBER OF FIRM FIRM SECURITIES TO BE
UNDERWRITER SECURITIES TO BE SOLD BY PURCHASED
----------- ----------------------------- ---------------------
COMPANY SELLING SHAREHOLDERS
------- --------------------
Credit Suisse First Boston Corporation........
BancAmerica Xxxxxxxxx Xxxxxxxx................
NationsBanc Xxxxxxxxxx
Securities LLC..............................
------- -------------------- ---------------------
TOTAL.......................................... ======= ==================== =====================
30
SCHEDULE B
NUMBER OF NUMBER OF
FIRM SECURITIES OPTIONAL SECURITIES
SELLING SHAREHOLDER TO BE SOLD TO BE SOLD
------------------- ------------------- -------------------
NationsCredit Commercial Corporation.................... -0-
Xxxxxxx Capital Partners, L.P. -
Enhanced Appreciation................................. -0-
Xxxxx X. X. Xxxxx....................................... -0-
------------------- -------------------
-0-
TOTAL................................................... =================== ===================
31
