Exhibit 1.1
Unilab Corporation
9,000,000 Shares
Common Stock
($.01 par value)
Underwriting Agreement
New York, New York
October 18, 2001
Xxxxxxx Xxxxx Xxxxxx Inc.
Credit Suisse First Boston Corporation
U.S. Bancorp Xxxxx Xxxxxxx Inc.
As Representatives of the several Underwriters,
c/o Xxxxxxx Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
The persons named in Schedule II hereto (the "Selling Stockholders")
propose to sell to the several underwriters named in Schedule I hereto (the
"Underwriters"), for whom you are acting as representatives (the
"Representatives"), 9,000,000 shares of Common Stock, $.01 par value ("Common
Stock") of Unilab Corporation, a corporation organized under the laws of
Delaware (the "Company") (said shares to be sold by the Selling Stockholders
being hereinafter called the "Underwritten Securities"). The Selling
Stockholders named in Schedule II hereto also propose to grant to the
Underwriters an option to purchase up to 1,350,000 additional shares of Common
Stock to cover over-allotments (the "Option Securities"; the Option Securities,
together with the Underwritten Securities, being hereinafter called the
"Securities"). The Underwritten Securities include up to ______ shares of Common
Stock and the Option Securities include up to _____ shares of Common Stock
(collectively, the "Stock Option Shares") to be acquired by certain Selling
Stockholders identified in Schedule II hereto upon exercise of currently
outstanding options to purchase Common Stock granted under the Company's 2000
Executive Stock Option Plan (the "Stock Option Selling Stockholders").
To the extent there are no additional Underwriters listed on Schedule I
other than you, the term Representatives as used herein shall mean you, as
Underwriters, and the terms Representatives and Underwriters shall mean either
the singular or plural as the context requires. The use of the neuter in this
Agreement shall include the feminine and masculine wherever appropriate. Certain
terms used herein are defined in Section 17 hereof.
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It is understood and agreed that Xxxxxxx Xxxxx Xxxxxx Inc. ("SSB") and
Credit Suisse First Boston Corporation ("CSFB") are joint book-running managers
(together, the "Joint Managers") and any determinations or other actions to be
made under this Agreement by you or the Representatives shall require the
consent of both SSB and CSFB.
1. Representations and Warranties.
(i) The Company represents and warrants to, and agrees with, each
Underwriter as set forth below in this Section 1.
(a) The Company has prepared and filed with the Commission a
registration statement (file number 333-70866) on Form S-1, including
a related preliminary prospectus, for registration under the Act of
the offering and sale of the Securities. The Company may have filed
one or more amendments thereto, including a related preliminary
prospectus, each of which has previously been furnished to you. The
Company will next file with the Commission either (1) prior to the
Effective Date of such registration statement, a further amendment to
such registration statement (including the form of final prospectus)
or (2) after the Effective Date of such registration statement, a
final prospectus in accordance with Rules 430A and 424(b). In the case
of clause (2), the Company has included in such registration
statement, as amended at the Effective Date, all information (other
than Rule 430A Information) required by the Act and the rules
thereunder to be included in such registration statement and the
Prospectus. As filed, such amendment and form of final prospectus, or
such final prospectus, shall contain all Rule 430A Information,
together with all other such required information, and, except to the
extent the Representatives shall agree in writing to a modification,
shall be in all substantive respects in the form furnished to you
prior to the Execution Time or, to the extent not completed at the
Execution Time, shall contain only such specific additional
information and other changes (beyond that contained in the latest
Preliminary Prospectus) as the Company has advised you, prior to the
Execution Time, will be included or made therein.
(b) On the Effective Date, the Registration Statement did or
will, and when the Prospectus is first filed (if required) in
accordance with Rule 424(b) and on the Closing Date (as defined
herein) and on any date on which Option Securities are purchased, if
such date is not the Closing Date (a "settlement date"), the
Prospectus (and any supplements thereto) will, comply in all material
respects with the applicable requirements of the Act and the rules
thereunder; on the Effective Date and at the Execution Time, the
Registration Statement did not or will not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
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statements therein not misleading; and, on the Effective Date, the
Prospectus, if not filed pursuant to Rule 424(b), will not, and on the
date of any filing pursuant to Rule 424(b), and on the Closing Date
and any settlement date, the Prospectus (together with any supplement
thereto) will not, include any untrue statement of a material fact or
omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that the Company makes
no representations or warranties as to the information contained in or
omitted from the Registration Statement, or the Prospectus (or any
supplement thereto) in reliance upon and in conformity with
information furnished in writing to the Company by or on behalf of any
Underwriter through the Representatives specifically for inclusion in
the Registration Statement or the Prospectus (or any supplement
thereto).
(c) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware with full corporate power and authority to own or lease,
as the case may be, and to operate its properties and conduct its
business as described in the Prospectus, and is duly qualified to do
business as a foreign corporation and is in good standing under the
laws of the State of California and each other jurisdiction which
requires such qualification, except where the failure to be so
qualified or in good standing in any such other jurisdiction would not
have a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company
whether or not arising from transactions in the ordinary course of
business (a "Material Adverse Effect").
(d) The Company has no subsidiaries and does not own any shares
of capital stock or other securities of or interests in any other
Person.
(e) The Company's authorized equity capitalization is as set
forth in the Prospectus. The capital stock of the Company conforms in
all material respects to the description thereof contained in the
Prospectus. The outstanding shares of Common Stock, including the
Securities being sold hereunder by the Selling Stockholders, have
been, or, in the case of the Stock Option Shares, prior to the Closing
Date or any settlement date for Option Securities, will have been,
duly and validly authorized and issued and are or will be, as the case
may be, fully paid and nonassessable. The Securities being sold by the
Selling Stockholders are, or, in the case of the Stock Option Shares,
prior to the Closing Date or any settlement date for Option
Securities, will be, duly listed, and admitted and authorized for
trading, on the Nasdaq National Market, subject to official notice of
issuance and evidence of satisfactory distribution, if applicable. The
certificates for the Securities are, or, in the case of the Stock
Option Shares, prior to the Closing Date or any settlement date for
Option Securities, will be in valid and sufficient form; the holders
of outstanding shares of capital stock of the Company are not entitled
to preemptive or other rights to subscribe for the
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Securities; and, except as set forth in the Prospectus, no options,
warrants or other rights to purchase, agreements or other obligations
to issue, or rights to convert any obligations into or exchange any
securities for, shares of capital stock of or ownership interests in
the Company are outstanding.
(f) There is no franchise, contract or other document of a
character required to be described in the Registration Statement or
Prospectus, or to be filed as an exhibit thereto, which is not
described or filed as required; and the statements in the Prospectus
under the headings "Business - Quality Assurance", "Business -
Governmental Regulation" and "Business - Legal Proceedings", insofar
as such statements summarize legal matters, agreements, documents or
proceedings discussed therein, are accurate and fair summaries of such
legal matters, agreements, documents or proceedings.
(g) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid and binding
obligation of the Company enforceable in accordance with its terms.
(h) The Company is not and, after giving effect to the offering
and sale of the 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, as amended.
(i) No consent, approval, authorization, filing with or order of
any court or governmental agency or body is required in connection
with the transactions contemplated herein, except such as have been
obtained under the Act and such as may be required under the blue sky
laws of any jurisdiction in connection with the purchase and
distribution of the Securities by the Underwriters in the manner
contemplated herein and in the Prospectus.
(j) Neither the sale of the Securities nor the consummation of
any other of the transactions herein contemplated nor the fulfillment
of the terms hereof will conflict with, result in a breach or
violation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company pursuant to, (i) the charter or
by-laws of the Company, (ii) the terms of any indenture, contract,
lease, mortgage, deed of trust, note agreement, loan agreement or
other agreement, obligation, condition, covenant or instrument to
which the Company is a party or bound or to which its property is
subject, or (iii) any statute, law, rule, regulation, judgment, order
or decree applicable to the Company of any court, regulatory body,
administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Company or any of its
properties; except, in the case of clause (ii) or (iii), for any such
conflict, breach, violation or imposition that would not have a
Material Adverse Effect.
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(k) Except for those rights contained in the Stockholders
Agreement, dated as of November 23, 1999, and the Investor
Stockholders Agreement, dated as of November 23, 1999, among the
Company and the stockholders of the Company party thereto, no holders
of securities of the Company have rights to the registration of such
securities under the Registration Statement.
(l) The historical financial statements and schedules of the
Company included in the Prospectus and the Registration Statement
present fairly in all material respects the financial condition,
results of operations and cash flows of the Company as of the dates
and for the periods indicated, comply as to form with the applicable
accounting requirements of the Act and have been prepared in
conformity with generally accepted accounting principles applied on a
consistent basis throughout the periods involved (except as otherwise
noted therein). The selected financial data set forth under the
caption "Selected Financial Data" in the Prospectus and Registration
Statement fairly present, on the basis stated in the Prospectus and
the Registration Statement, the information included therein.
(m) Except as set forth in the Prospectus, no action, suit or
proceeding by or before any court or governmental agency, authority or
body or any arbitrator, including, without limitation, the United
States Centers for Medicare and Medicaid Services ("CMS"), the
Department of Health and Human Services (the "HHS"), the Department of
Justice (the "DOJ"), the Office of the Inspector General (the "OIG")
and the United States Food and Drug Administration (the "FDA"),
involving the Company or its property is pending or, to the best
knowledge of the Company, threatened that (i) could have a material
adverse effect on the performance of this Agreement or the
consummation of any of the transactions contemplated hereby or (ii)
could have a Material Adverse Effect.
(n) The Company owns or leases all such properties as are
necessary to the conduct of its operations as presently conducted.
(o) The Company is not in violation or default of (i) any
provision of its charter or bylaws, (ii) the terms of any indenture,
contract, lease, mortgage, deed of trust, note agreement, loan
agreement or other agreement, obligation, condition, covenant or
instrument to which it is a party or bound or to which its property is
subject, or (iii) except as set forth in the Prospectus, any statute,
law, rule, regulation, judgment, order or decree of any court,
regulatory body, administrative agency, governmental body, arbitrator
or other authority having jurisdiction over the Company or any of its
properties; except, in the case of clause (ii) or (iii), for any such
violation or default that would not have a Material Adverse Effect.
(p) Each of Deloitte & Touche LLP and Xxxxxx Xxxxxxxx LLP, who
have certified certain financial statements of the Company and
delivered their
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reports with respect to the audited consolidated financial statements
and schedules included in the Prospectus, are independent public
accountants with respect to the Company within the meaning of the Act
and the applicable published rules and regulations thereunder.
(q) There are no transfer taxes or other similar fees or charges
under Federal law or the laws of any state, or any political
subdivision thereof, required to be paid in connection with the
execution and delivery of this Agreement or the issuance by the
Company of the Securities.
(r) The Company has filed all foreign, Federal, state and local
tax returns that are required to be filed or has requested extensions
thereof (except in any case in which the failure so to file would not
have a Material Adverse Effect) and has paid all taxes required to be
paid by it and any other assessment, fine or penalty levied against
it, to the extent that any of the foregoing is due and payable, except
for any such assessment, fine or penalty that is currently being
contested in good faith or as would not have a Material Adverse
Effect.
(s) No labor problem or dispute with the employees of the Company
exists or is threatened or imminent, and the Company is not aware of
any existing or imminent labor disturbance by the employees of any of
its principal suppliers, contractors or customers, in each case that
could have a Material Adverse Effect.
(t) The Company is insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as
are prudent and customary in the business in which it is engaged; and
the Company has no reason to believe that it will not be able to renew
its existing insurance coverage as and when such coverage expires or
to obtain similar coverage from similar insurers as may be necessary
to continue its business at a cost that would not have a Material
Adverse Effect, except as set forth in or contemplated in the
Prospectus (exclusive of any supplement thereto).
(u) Except as set forth in the Prospectus, (A) the Company
possesses all permits, licenses, provider numbers, certificates,
approvals, consents, orders, certifications (including, without
limitation, clinical laboratory licenses, certification under the
Clinical Laboratories Improvement Act of 1967, as amended in 1988
("CLIA") and certifications required by the FDA and the State of
California and under the Medicare, MediCal and Medicaid programs),
accreditations (including, without limitation, accreditation by CLIA
and the College of American Pathologists ("CAP")) and other
authorizations (collectively, "Governmental Licenses") issued by, and
have made all declarations and filings with, the appropriate Federal,
state, local or foreign regulatory agencies or bodies necessary to
conduct the business now operated by the Company (including, without
limitation, Governmental Licenses as are
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required (i) under such Federal and state healthcare laws as are
applicable to the Company and (ii) with respect to the clinical
laboratories operated by the Company that participate in the Medicare,
MediCal and/or Medicaid programs, to receive reimbursement
thereunder), except where the failure to possess such Governmental
Licenses or to make such declarations and filings would not result in
a Material Adverse Effect; the Company is in compliance with the terms
and conditions of all such Governmental Licenses, except where the
failure so to comply would not, individually and in the aggregate,
have a Material Adverse Effect; all of the Governmental Licenses are
valid and in full force and effect, except when the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to
be in full force and effect would not have a Material Adverse Effect;
and (B) the Company has not received any notice of proceedings
relating to the revocation or modification of any such Governmental
Licenses which, individually or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a Material
Adverse Effect.
(v) The Company maintains a system of internal accounting
controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain asset
accountability; (iii) access to assets is permitted only in accordance
with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(w) The Company has not taken, directly or indirectly, any action
designed to or that would constitute or that might reasonably be
expected to cause or result in, under the Exchange Act or otherwise,
stabilization or manipulation of the price of any security of the
Company to facilitate the sale or resale of the Securities.
(x) Except as set forth in the Prospectus, the Company and each
of the clinical laboratories owned, leased or operated by it (i) are
in compliance with any and all applicable foreign, Federal, state and
local laws and regulations relating to the protection of human health
and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants ("Environmental Laws"), (ii) have
received and are in compliance with all permits, licenses or other
approvals required of them under applicable Environmental Laws to
conduct their respective businesses, (iii) have not received notice of
any actual or potential liability for the investigation or remediation
of any disposal or release of hazardous or toxic substances or wastes,
pollutants or contaminants, and (iv) are not subject to liabilities
and costs associated with compliance by them with Environmental Laws,
except where such non-compliance with Environmental Laws, failure to
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receive required permits, licenses or other approvals, or liabilities
or costs would not, individually and in the aggregate, have a Material
Adverse Effect. Neither the Company nor any of the clinical
laboratories owned, leased or operated by it has received notice that
it has been named as a "potentially responsible party" under the
Comprehensive Environmental Response, Compensation, and Liability Act
of 1980, as amended, in any proceeding currently pending.
(y) The Company has fulfilled its obligations, if any, under the
minimum funding standards of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Employee
Retirement Income Security Act of 1974 ("ERISA") and the regulations
and published interpretations thereunder with respect to each "plan"
(as defined in Section 3(3) of ERISA and such regulations and
published interpretations) in which employees of the Company are
eligible to participate and each such plan is in compliance in all
material respects with the presently applicable provisions of ERISA
and such regulations and published interpretations. The Company has
not incurred any unpaid liability to the Pension Benefit Guaranty
Corporation (other than for the payment of premiums in the ordinary
course) or to any such plan under Title IV of ERISA.
(z) The Company owns, possesses, licenses or has other rights to
use, on reasonable terms, all patents, patent applications, trade and
service marks, trade and service xxxx registrations, trade names,
copyrights, licenses, inventions, trade secrets, technology, know-how
and other intellectual property (collectively, the "Intellectual
Property") necessary for the conduct of the Company's business as now
conducted or as proposed in the Prospectus to be conducted; and the
Company has not received any notice of infringement of or conflict
with asserted rights of others with respect to any Intellectual
Property, which infringement or conflict, individually or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in a Material Adverse Effect.
(aa) Except as set forth in the Prospectus, neither the Company
nor, to the knowledge of the Company, any officer, director,
stockholder, employee or other agent of the Company, has engaged,
directly or indirectly, in any activity which is prohibited under
Federal Medicare and Medicaid statutes or any other Federal health
care or other law or any regulations promulgated pursuant to such
statutes, or related state or local statutes or regulations or any
rules of professional conduct, including but not limited to the
following: (i) knowingly and willfully making or causing to be made a
false statement or representation of a material fact in any
application for, or for use in determining rights to, any benefit or
payment under the Medicare or Medicaid program or from any third
party; (ii) failing to disclose knowledge by a claimant of the
occurrence of any event affecting the initial or continued right to
any benefit or payment under the Medicare or Medicaid program or from
any third party on its own behalf or on behalf of another, with intent
to secure such benefit or payment fraudulently; (iii) in the
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absence of an applicable safe harbor regulation, knowingly and
willfully offering, paying, soliciting or receiving any remuneration
(including any kickback, bribe or rebate), in cash or in kind (a) in
return for referring an individual to a person for the furnishing or
arranging for the furnishing of any item or service for which payment
may be made in whole or in part by Medicare or Medicaid or any third
party or (b) in return for purchasing, leasing or ordering or
arranging for or recommending the purchasing, leasing or ordering of
any good, facility, service or item for which payment may be made in
whole or in part by Medicare or Medicaid or any third party; (iv)
knowingly and willfully referring an individual to a person with which
they have ownership or certain other financial arrangements (where
applicable Federal or state law prohibits such referrals); and (v)
knowingly and willfully violating any enforcement initiative
instituted by any governmental agency (including, without limitation,
the OIG and the DOJ), except for any such activities which would not,
individually and in the aggregate, result in a Material Adverse
Effect.
(bb) The Company has not failed to file with applicable
regulatory authorities (including, but not limited to, CLIA, the FDA,
the CAP, Medicare, MediCal and Medicaid) any statement, report,
information or form required by any applicable law, regulation or
order, except where the failure to file or to be so in compliance
would not, individually and in the aggregate, have a Material Adverse
Effect. No deficiencies have been asserted by any regulatory
commission, agency or authority with respect to any such filings or
submissions, except for any such failures to be in compliance or
deficiencies which would not, individually and in the aggregate, have
a Material Adverse Effect.
(cc) The Company has established a compliance program (including
a written compliance policy) to assist the Company and its directors,
officers and employees in complying with applicable regulatory agency
guidelines (including, without limitation, those regulations and
guidelines published by CMS), and to provide compliance policies
governing applicable areas for independent clinical laboratories
(including, without limitation, patient confidentiality, diagnosis
coding and anti-kickback statutes).
(dd) The accounts receivable of the Company have been adjusted to
reflect material changes in the reimbursement policies of third party
payors such as Medicare, Medicaid, MediCal, private insurance
companies, health maintenance organizations, preferred provider
organizations, managed care systems and other third party payors. The
accounts receivable of the Company, after giving effect to the
allowance for doubtful accounts, relating to such third party payors
do not materially exceed amounts the Company is entitled to receive.
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(ee) Except as disclosed in the Registration Statement and the
Prospectus, the Company does not have any material lending or other
relationship with any bank or lending affiliate of any of the
Representatives.
Any certificate signed by any officer of the Company and
delivered to the Representatives or counsel for the Underwriters in connection
with the offering of the Securities shall be deemed a representation and
warranty by the Company, as to matters covered thereby, to each Underwriter.
(ii) Each Selling Stockholder represents and warrants to, and
agrees with, each Underwriter that:
(a) Such Selling Stockholder is, or, in the case of any Stock
Option Selling Stockholder, prior to the Closing Date or any
settlement date for Option Securities, will be, the record and
beneficial owner of the Securities to be sold by it hereunder free and
clear of all liens, encumbrances, equities and claims and has, or, in
the case of any Stock Option Selling Stockholder, prior to the Closing
Date or any settlement date for Option Securities, will have, duly
endorsed such Securities in blank, and, assuming that each Underwriter
acquires its interest in the Securities from such Selling Stockholder
without notice of any adverse claim (within the meaning of Section
8-105 of the Uniform Commercial Code as in effect in the State of New
York from time to time ("UCC")), each Underwriter that has purchased
such Securities delivered on the Closing Date or on any settlement
date for Option Securities to The Depository Trust Company or other
securities intermediary by making payment therefor as provided herein
and that has had such Securities credited to the securities account or
accounts of such Underwriters maintained with The Depository Trust
Company or such other securities intermediary will have acquired a
security entitlement (within the meaning of Section 8-102(a)(17) of
the UCC) to such Securities purchased by such Underwriter, and no
action based on an adverse claim (within the meaning of Section 8-105
of the UCC) may be asserted against such Underwriter with respect to
such Securities.
(b) Such Selling Stockholder has not taken, directly or
indirectly, any action designed to or that would constitute or that
might reasonably be expected to cause or result in, under the Exchange
Act or otherwise, stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Securities.
(c) Certificates in negotiable form for such Selling
Stockholder's Securities have been, or, in the case of any Stock
Option Selling Stockholder, prior to the Closing Date or any
settlement date for Option Securities, will have been, placed in
custody, for delivery pursuant to the terms of this Agreement, under a
Custody Agreement and Power of Attorney duly authorized (if
applicable), executed and delivered by such Selling Stockholder, in
the form
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heretofore furnished to you (the "Custody Agreement") with First Union
National Bank, as Custodian (the "Custodian"); the Securities
represented by the certificates so held or to be held, as the case may
be, in custody for each Selling Stockholder are or will be, as the
case may be, subject to the interests hereunder of the Underwriters;
the arrangements for custody and delivery of such certificates, made
by such Selling Stockholder hereunder and under the Custody Agreement,
are not subject to termination by any acts of such Selling
Stockholder, or by operation of law, whether by the death or
incapacity of such Selling Stockholder, or the occurrence of any other
event; and if any such death, incapacity or any other such event shall
occur before the delivery of such Securities hereunder, certificates
for the Securities will be delivered by the Custodian in accordance
with the terms and conditions of this Agreement and the Custody
Agreement as if such death, incapacity or other event had not
occurred, regardless of whether or not the Custodian shall have
received notice of such death, incapacity or other event.
(d) To the best knowledge of such Selling Stockholder, no
consent, approval, authorization or order of any court or governmental
agency or body is required for consummation by such Selling
Stockholder of the transactions contemplated herein, except such as
may have been obtained under the Act and such as may be required under
the blue sky laws of any jurisdiction in connection with the purchase
and distribution of the Securities by the Underwriters and such other
approvals as have been obtained.
(e) To the best knowledge of such Selling Stockholder, neither
the sale of the Securities being sold by such Selling Stockholder nor
the consummation of any other of the transactions herein contemplated
by such Selling Stockholder or the fulfillment of the terms hereof by
such Selling Stockholder will conflict with, result in a breach or
violation of, or constitute a default under any law or the charter or
by-laws or other organizational documents, in each case if applicable,
of such Selling Stockholder or the terms of any indenture or other
agreement or instrument to which such Selling Stockholder or any of
its subsidiaries (if applicable) is a party or bound, or any judgment,
order or decree applicable to such Selling Stockholder or any of its
subsidiaries (if applicable) of any court, regulatory body,
administrative agency, governmental body or arbitrator having
jurisdiction over such Selling Stockholder or any of its subsidiaries
(if applicable).
(f) In respect of any statements in or omissions from the
Registration Statement or the Prospectus or any supplements thereto
made in reliance upon and in conformity with information furnished in
writing to the Company by or on behalf of any Selling Stockholder
specifically for use in connection with the preparation thereof, such
Selling Stockholder hereby makes the same representations and
warranties to each Underwriter as the Company makes to such
Underwriter under paragraph (i)(b) of this Section; the sale of
Securities by
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such Selling Stockholder pursuant hereto is not prompted by any
information concerning the Company which is not set forth in the
Prospectus or any supplement thereto. The Underwriters acknowledge and
agree that, for all purposes of this Agreement, the only information
furnished to the Company by or on behalf of any Selling Stockholder
specifically for use in any Preliminary Prospectus, the Registration
Statement or the Prospectus or any amendment or supplement thereto are
the statements pertaining to the number of shares owned and the number
of shares proposed to be sold by such Selling Stockholder under the
caption "Principal and Selling Stockholders."
Any certificate signed by or on behalf of any Selling Stockholder and
delivered to the Representatives or counsel for the Underwriters in connection
with the offering of the Securities shall be deemed a representation and
warranty by such Selling Stockholder, as to matters covered thereby, to each
Underwriter.
2. Purchase and Sale.
(a) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Selling Stockholders agree,
severally and not jointly, to sell to each Underwriter, and each Underwriter
agrees, severally and not jointly, to purchase from the Selling Stockholders, at
a purchase price of $_____ per share, the amount of the Underwritten Securities
set forth opposite such Underwriter's name in Schedule I hereto.
(b) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Selling Stockholders named
in Schedule II hereto hereby grant an option to the several Underwriters to
purchase, severally and not jointly, up to 1,350,000 Option Securities at the
same purchase price per share as the Underwriters shall pay for the Underwritten
Securities. Said option may be exercised only to cover over-allotments in the
sale of the Underwritten Securities by the Underwriters. Said option may be
exercised in whole or in part at any time on or before the 30th day after the
date of the Prospectus upon written or telegraphic notice by the Representatives
to the Company and such Selling Shareholders setting forth the number of shares
of the Option Securities as to which the several Underwriters are exercising the
option and the settlement date. The maximum number of Option Securities which
each Selling Stockholder agrees to sell is set forth in Schedule II hereto. In
the event that the Underwriters exercise less than their full over-allotment
option, the number of Option Securities to be sold by each Selling Stockholder
listed on Schedule II shall be, as nearly as practicable, in the same proportion
as the maximum number of Option Securities to be sold by each Selling
Stockholder and the number of Option Securities to be sold. The number of Option
Securities to be purchased by each Underwriter shall be the same percentage of
the total number of shares of the Option Securities to be purchased by the
several Underwriters as such Underwriter is purchasing
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of the Underwritten Securities, subject to such adjustments as you in your
absolute discretion shall make to eliminate any fractional shares.
3. Delivery and Payment. Delivery of and payment for the Underwritten
Securities and the Option Securities (if the option provided for in Section 2(b)
hereof shall have been exercised on or before the third Business Day prior to
the Closing Date) shall be made at 10:00 AM, New York City time, on October __,
2001, or at such time on such later date not more than three Business Days after
the foregoing date as the Representatives shall designate, which date and time
may be postponed by agreement among the Representatives, the Company and the
Selling Stockholders or as provided in Section 9 hereof (such date and time of
delivery and payment for the Securities being herein called the "Closing Date").
Delivery of the Securities shall be made to the Representatives for the
respective accounts of the several Underwriters against payment by the several
Underwriters through the Representatives of the aggregate purchase price of the
Securities being sold by the Selling Stockholders to or upon the order of the
Selling Stockholders by wire transfer payable in same-day funds to the account
of the Custodian. Delivery of the Underwritten Securities and the Option
Securities shall be made through the facilities of The Depository Trust Company
unless the Representatives shall otherwise instruct.
The Company will pay all applicable state transfer taxes, if any, involved
in the transfer to the several Underwriters of the Securities to be purchased by
them from the Selling Stockholders, and the respective Underwriters will pay any
additional stock transfer taxes involved in further transfers.
If the option provided for in Section 2(b) hereof is exercised after the
third Business Day prior to the Closing Date, the Selling Stockholders named in
Schedule II hereto will deliver the Option Securities (at the expense of the
Company) to the Representatives, at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, xx
the date specified by the Representatives (which shall be within three Business
Days after exercise of said option) for the respective accounts of the several
Underwriters, against payment by the several Underwriters through the
Representatives of the aggregate purchase price thereof to or upon the order of
the Selling Stockholders named in Schedule II hereto by wire transfer payable in
same-day funds to the account of the Custodian. If settlement for the Option
Securities occurs after the Closing Date, the Company and such Selling
Stockholders will deliver to the Representatives on the settlement date for the
Option Securities, and the obligation of the Underwriters to purchase the Option
Securities shall be conditioned upon receipt of, supplemental opinions,
certificates and letters confirming as of such date the opinions, certificates
and letters delivered on the Closing Date pursuant to Section 6 hereof.
4. Offering by Underwriters. It is understood that the several Underwriters
propose to offer the Securities for sale to the public as set forth in the
Prospectus.
14
5. Agreements. (i) The Company agrees with the several Underwriters that:
(a) The Company will use its best efforts to cause the Registration
Statement, if not effective at the Execution Time, and any amendment
thereof, to become effective. Prior to the termination of the offering of
the Securities, the Company will not file any amendment of the Registration
Statement or supplement to the Prospectus or any Rule 462(b) Registration
Statement unless the Company has furnished you a copy for your review prior
to filing and will not file any such proposed amendment or supplement to
which the Joint Managers, acting jointly, reasonably object. Subject to the
foregoing sentence, if the Registration Statement has become or becomes
effective pursuant to Rule 430A, or filing of the Prospectus is otherwise
required under Rule 424(b), the Company will cause the Prospectus, properly
completed, and any supplement thereto to be filed with the Commission
pursuant to the applicable paragraph of Rule 424(b) within the time period
prescribed and will provide evidence satisfactory to the Representatives of
such timely filing. The Company will promptly advise the Representatives
(1) when the Registration Statement, if not effective at the Execution
Time, shall have become effective, (2) when the Prospectus, and any
supplement thereto, shall have been filed (if required) with the Commission
pursuant to Rule 424(b) or when any Rule 462(b) Registration Statement
shall have been filed with the Commission, (3) when, prior to termination
of the offering of the Securities, any amendment to the Registration
Statement shall have been filed or become effective, (4) of any request by
the Commission or its staff for any amendment of the Registration
Statement, or any Rule 462(b) Registration Statement, or for any supplement
to the Prospectus or for any additional information, (5) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any proceeding
for that purpose and (6) of the receipt by the Company of any notification
with respect to the suspension of the qualification of the Securities for
sale in any jurisdiction or the institution or threatening of any
proceeding for such purpose. The Company will use its best efforts to
prevent the issuance of any such stop order or the suspension of any such
qualification and, if issued, to obtain as soon as possible the withdrawal
thereof.
(b) If, at any time when a prospectus relating to the Securities is
required to be delivered under the Act, any event occurs as a result of
which the Prospectus as then supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary
to make the statements therein in the light of the circumstances under
which they were made not misleading, or if it shall be necessary to amend
the Registration Statement or supplement the Prospectus to comply with the
Act or the rules thereunder, the Company promptly will (1) notify the
Representatives of any such event, (2) prepare and file with the
Commission, subject to the second sentence of
15
paragraph (a) of this Section 5, an amendment or supplement which will
correct such statement or omission or effect such compliance, and (3)
supply any supplemented Prospectus to you in such quantities as you may
reasonably request in writing; provided that in case any Underwriter is
required to deliver a Prospectus in connection with sales of any of the
Securities at any time nine months or more after the Execution Time, any
preparation and delivery of any amended or supplemented Prospectus shall be
at the expense of such Underwriter.
(c) As soon as practicable and as permitted under the Exchange Act,
the Company will make generally available to its security holders and to
the Representatives an earnings statement or statements of the Company and
its subsidiaries which will satisfy the provisions of Section 11(a) of the
Act and Rule 158 under the Act.
(d) The Company will furnish to the Representatives and counsel for
the Underwriters four signed copies of the Registration Statement
(including exhibits thereto) and to each other Underwriter a copy of the
Registration Statement (without exhibits thereto) and, so long as delivery
of a prospectus by an Underwriter or dealer may be required by the Act, as
many copies of each Preliminary Prospectus and the Prospectus and any
supplement thereto as the Representatives may reasonably request in
writing.
(e) The Company will arrange, if necessary, for the qualification of
the Securities for sale under the laws of such jurisdictions as the
Representatives may reasonably designate in writing and will maintain such
qualifications in effect so long as required for the distribution of the
Securities; provided that in no event shall the Company be obligated to
qualify to do business in any jurisdiction where it is not now so qualified
or to take any action that would subject it to service of process in suits,
other than those arising out of the offering or sale of the Securities, in
any jurisdiction where it is not now so subject.
(f) The Company will not, without the prior written consent of the
Joint Managers, offer, sell, contract to sell, pledge, or otherwise dispose
of, (or enter into any transaction which is designed to, or might
reasonably be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash settlement or
otherwise) by the Company or any affiliate of the Company or any person in
privity with the Company or any affiliate of the Company), directly or
indirectly, including the filing (or participation in the filing) of a
registration statement with the Commission in respect of, or establish or
increase a put equivalent position or liquidate or decrease a call
equivalent position within the meaning of Section 16 of the Exchange Act
with respect to, any shares of capital stock of the Company or any
securities convertible into, or exercisable or exchangeable for, shares of
such capital stock; or publicly announce an intention to effect any such
transaction, for a period of 90 days after the date of this Agreement,
provided, however, that the Company may
-------- -------
16
issue and sell Common Stock pursuant to any employee stock option plan,
stock ownership plan or dividend reinvestment plan of the Company in effect
at the Execution Time, the Company may issue Common Stock issuable upon the
conversion of securities or the exercise of warrants outstanding at the
Execution Time and the Company may issue or sell Common Stock as
consideration for acquisitions by the Company as long as the recipients of
such Common Stock have agreed in writing to be bound by the terms of
lock-up agreements substantially in the form of Exhibit A hereto providing
for a lock-up period ending 90 days after the date of this Agreement.
(g) The Company agrees to pay the costs and expenses relating to the
following matters: (i) the preparation, printing or reproduction and filing
with the Commission of the Registration Statement (including financial
statements and exhibits thereto), each Preliminary Prospectus, the
Prospectus, and each amendment or supplement to any of them; (ii) the
printing (or reproduction) and delivery (including postage, air freight
charges and charges for counting and packaging) of such copies of the
Registration Statement, each Preliminary Prospectus, the Prospectus, and
all amendments or supplements to any of them, as may, in each case, be
reasonably requested for use in connection with the offering and sale of
the Securities; (iii) the preparation, printing, authentication, issuance
and delivery of certificates for the Securities, including any stamp or
transfer taxes in connection with the original issuance and sale of the
Securities; (iv) the printing (or reproduction) and delivery of this
Agreement, any blue sky memorandum and all other agreements or documents
printed (or reproduced) and delivered in connection with the offering of
the Securities; (v) the registration of the Securities under the Exchange
Act and the listing of the Securities on the Nasdaq National Market; (vi)
any registration or qualification of the Securities for offer and sale
under the securities or blue sky laws of the several states (including
filing fees and the reasonable fees and expenses of counsel for the
Underwriters relating to such registration and qualification); (vii) any
filings required to be made with the National Association of Securities
Dealers, Inc. (including filing fees and the reasonable fees and expenses
of counsel for the Underwriters relating to such filings); (viii) the
transportation and other expenses incurred by or on behalf of Company
representatives in connection with presentations to prospective purchasers
of the Securities; (ix) the fees and expenses of the Company's accountants
and the fees and expenses of counsel (including local and special counsel)
for the Company and the Selling Stockholders (in the case of the Selling
Stockholders, as may be determined by a majority of the Selling
Stockholders based upon number of shares of Common Stock owned); and (x)
all other costs and expenses incident to the performance by the Company and
the Selling Stockholders of their obligations hereunder (in the case of the
Selling
17
Stockholders, as may be determined by a majority of the Selling
Stockholders based upon number of shares of Common Stock owned).
(ii) Each Selling Stockholder agrees with the several Underwriters
that:
(a) Such Selling Stockholder will not, without the prior written
consent of the Joint Managers, offer, sell, contract to sell, pledge or
otherwise dispose of, (or enter into any transaction which is designed to,
or might reasonably be expected to, result in the disposition (whether by
actual disposition or effective economic disposition due to cash settlement
or otherwise) by the Selling Stockholder or any affiliate of the Selling
Stockholder or any person in privity with the Selling Stockholder or any
affiliate of the Selling Stockholder), directly or indirectly, including
the filing (or participation in the filing) of a registration statement
with the Commission in respect of, or establish or increase a put
equivalent position or liquidate or decrease a call equivalent position
within the meaning of Section 16 of the Exchange Act with respect to, any
shares of capital stock of the Company or any securities convertible into,
or exercisable or exchangeable for, such capital stock, or publicly
announce an intention to effect any such transaction, for a period of 90
days after the date of this Agreement, other than the Securities to be sold
by such Selling Stockholder hereunder and shares of Common Stock disposed
of as bona fide gifts approved by the Joint Managers and as may otherwise
be agreed by the Joint Managers.
(b) Such Selling Stockholder will not take, directly or indirectly,
any action designed to or that would constitute or that might reasonably be
expected to cause or result in, under the Exchange Act or otherwise,
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Securities.
(c) Such Selling Stockholder will advise you promptly, and if
requested by you, will confirm such advice in writing, so as long as
delivery of a prospectus relating to the Securities by an underwriter or
dealer may be required under the Act, of any change in information in the
Registration Statement or the Prospectus relating to such Selling
Stockholder.
(iii) With reference to the lock-up letter agreements delivered by any
Selling Stockholder to the Joint Managers in connection with the Company's
initial public offering which closed on June 11, 2001, the Joint Managers
hereby consent to the sale by such Selling Stockholders of the Securities
to be sold by such Selling Stockholder pursuant to this Agreement.
6. Conditions to the Obligations of the Underwriters. The obligations of
the Underwriters to purchase the Underwritten Securities and the Option
Securities, as
18
the case may be, shall be subject to the accuracy of the representations and
warranties on the part of the Company and the Selling Stockholders contained
herein as of the Execution Time, the Closing Date and any settlement date
pursuant to Section 3 hereof, to the accuracy of the statements of the Company
and the Selling Stockholders made in any certificates pursuant to the provisions
hereof, to the performance by the Company and the Selling Stockholders of their
respective obligations hereunder and to the following additional conditions:
(a) If the Registration Statement has not become effective prior to the
Execution Time, unless the Representatives agree in writing to a later time, the
Registration Statement will become effective not later than (i) 6:00 PM New York
City time on the date of determination of the public offering price, if such
determination occurred at or prior to 3:00 PM New York City time on such date or
(ii) 9:30 AM on the Business Day following the day on which the public offering
price was determined, if such determination occurred after 3:00 PM New York City
time on such date; if filing of the Prospectus, or any supplement thereto, is
required pursuant to Rule 424(b), the Prospectus, and any such supplement, will
be filed in the manner and within the time period required by Rule 424(b); and
no stop order suspending the effectiveness of the Registration Statement shall
have been issued and no proceedings for that purpose shall have been instituted
or threatened.
(b) The Company shall have requested and caused Skadden, Arps, Slate,
Xxxxxxx & Xxxx, counsel for the Company ("Xxxxxxx Xxxx"), and Xxxxx X. Xxx,
General Counsel of the Company, to have furnished to the Representatives their
opinions, dated the Closing Date and addressed to the Representatives, in the
form attached hereto as Exhibits B and C, respectively.
(c) The Company shall have requested and caused Xxxxxx, Xxxxx & Xxxxxxx,
Inc., special regulatory counsel for the Company, to have furnished to the
Representatives their opinion, dated the Closing Date and addressed to the
Representatives, in the form attached hereto as Exhibit D.
(d) The Selling Stockholders shall have requested and caused Xxxxxxx Xxxx,
Xxxxx X. Xxxxxxx XX, Esq. and such other counsel to the Selling Stockholders as
are reasonably acceptable to the Joint Managers, to have furnished to the
Representatives their respective opinions dated the Closing Date and addressed
to the Representatives, covering the matters specified in Exhibit E hereto.
(e) The Representatives shall have received from Debevoise & Xxxxxxxx,
counsel for the Underwriters, such opinion or opinions, dated the Closing Date
and addressed to the Representatives, with respect to the issuance and sale of
the Securities, the Registration Statement, the Prospectus (together with any
supplement thereto) and other related matters as the Representatives may
reasonably require, and the
19
Company and the Selling Stockholders shall have furnished to such counsel
such documents as they request for the purpose of enabling them to pass upon
such matters.
(f) The Company shall have furnished to the Representatives a certificate
of the Company, signed by the Chief Executive Officer and the Chief Financial
Officer of the Company, dated the Closing Date, to the effect that the signers
of such certificate have carefully examined the Registration Statement, the
Prospectus, any supplements to the Prospectus and this Agreement and that:
(i) the representations and warranties of the Company in this Agreement are
true and correct on and as of the Closing Date with the same effect as if made
on the Closing Date and the Company has complied with all the agreements and
satisfied all the conditions on its part to be performed or satisfied at or
prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or, to the Company's knowledge, threatened; and
(iii) since the date of the most recent financial statements included in
the Prospectus (exclusive of any supplement thereto), there has been no Material
Adverse Effect.
(g) The Selling Stockholders shall have furnished to the Representatives a
certificate, signed on behalf of the Selling Stockholders and delivered pursuant
to the Custody Agreement, dated the Closing Date, to the effect that the
representations and warranties of the Selling Stockholders in this Agreement are
true and correct in all material respects on and as of the Closing Date to the
same effect as if made on the Closing Date.
(h) The Company shall have requested and caused Deloitte & Touche LLP and
Xxxxxx Xxxxxxxx LLP to have furnished to the Representatives letters, at the
Execution Time and at the Closing Date, dated respectively as of the Execution
Time and as of the Closing Date, in form and substance satisfactory to the
Representatives, substantially in the same form and substance as the letters
furnished by them in connection with the Company's initial public offering which
closed on June 11, 2001 and, in the case of the letter of Deloitte & Touche,
updated accordingly to cover periods subsequent to such initial public offering
to the satisfaction of the Representatives.
(i) Subsequent to the Execution Time or, if earlier, the dates as of which
information is given in the Registration Statement (exclusive of any amendment
thereof) and the Prospectus (exclusive of any supplement thereto), there shall
not have been (i) any change or decrease specified in the letter or letters
referred to in paragraph (h) of this Section 6 or (ii) any change, or any
development involving a
20
prospective change, in or affecting the condition (financial or otherwise),
earnings, business or properties of the Company, whether or not arising from
transactions in the ordinary course of business, except as set forth in or
contemplated in the Prospectus (exclusive of any supplement thereto) the effect
of which, in any case referred to in clause (i) or (ii) above, is, in the sole
judgment of the Joint Managers, acting jointly, so material and adverse as to
make it impractical or inadvisable to proceed with the offering or delivery of
the Securities as contemplated by the Registration Statement (exclusive of any
amendment thereof) and the Prospectus (exclusive of any supplement thereto).
(j) Prior to the Closing Date, the Company and the Selling Stockholders
shall have furnished to the Representatives such further information, customary
closing and secretary certificates and documents as the Representatives may
reasonably request, including, without limitation, Forms W-8 or W-9, as
required, from the Selling Stockholders.
(k) Subsequent to the Execution Time, there shall not have been any
decrease in the rating of any of the Company's debt securities by any
"nationally recognized statistical rating organization" (as defined for purposes
of Rule 436(g) under the Act) or any notice given of any intended or potential
decrease in any such rating or of a possible change in any such rating that does
not indicate the direction of the possible change.
(l) The Securities shall have been duly approved for quotation on the
Nasdaq National Market, and satisfactory evidence of such actions shall have
been provided to the Representatives.
(m) Prior to the Execution Time, the Company shall have furnished to the
Representatives a letter substantially in the form of Exhibit A hereto from each
of the Selling Stockholders (other than the Stock Option Selling Stockholders)
and each director and executive officer of the Company, addressed to the
Representatives.
If any of the conditions specified in this Section 6 shall not have been
fulfilled in all material respects when and as provided in this Agreement, or if
any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and counsel for the Underwriters, this
Agreement and all obligations of the Underwriters hereunder may be canceled at,
or at any time prior to, the Closing Date by the Representatives. Notice of such
cancellation shall be given to the Company and the Selling Stockholders in
writing or by telephone or facsimile confirmed in writing.
The documents required to be delivered by this Section 6 shall be delivered
at the office of Debevoise & Xxxxxxxx, counsel for the Underwriters, at 000
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, on the Closing Date.
21
7. Reimbursement of Underwriters' Expenses. If the sale of the Securities
provided for herein is not consummated because any condition to the obligations
of the Underwriters set forth in Section 6 hereof is not satisfied, because of
any termination pursuant to Section 10 hereof or because of any refusal,
inability or failure on the part of the Company or any Selling Stockholder to
perform any agreement herein or comply with any provision hereof other than by
reason of a default by any of the Underwriters, the Company will reimburse the
Underwriters severally through SSB on demand for all out-of-pocket expenses
(including reasonable fees and disbursements of counsel) that shall have been
reasonably incurred by them in connection with the proposed purchase and sale of
the Securities.
8. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless each Underwriter, the
directors, officers, employees and agents of each Underwriter and each person
who controls any Underwriter within the meaning of either the Act or the
Exchange Act against any and all losses, claims, damages or liabilities, joint
or several, to which they or any of them may become subject under the Act, the
Exchange Act or other Federal or state statutory law or regulation, at common
law 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 a material fact contained in the registration
statement for the registration of the Securities as originally filed or in any
amendment thereof, or in any Preliminary Prospectus or the Prospectus, or in any
amendment thereof or supplement thereto, 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
agrees to reimburse each such indemnified party, as incurred, for any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; 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 any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to
the Company by or on behalf of any Underwriter through the Representatives
specifically for inclusion therein; provided further that with respect to any
untrue statement or omission of material fact made in any Preliminary
Prospectus, the indemnity agreement contained in this Section 8(a) shall not
inure to the benefit of any Underwriter from whom the person asserting any such
loss, claim, damage or liability purchased the Securities concerned, to the
extent that any such loss, claim, damage or liability of such Underwriter occurs
under the circumstance where it shall have been determined by a court of
competent jurisdiction by final and non-appealable judgment that (w) the Company
had previously furnished copies of the Prospectus to the Representatives, (x)
delivery of the Prospectus was required by the Act to be made to such person,
(y) the untrue statement or omission of a material fact contained in the
Preliminary Prospectus was corrected in the Prospectus and (z) there was not
sent or
22
given to such person, at or prior to the written confirmation of the sale of
such Securities to such person, a copy of the Prospectus. This indemnity
agreement will be in addition to any liability which the Company may otherwise
have.
(b) Each Selling Stockholder severally agrees to indemnify and hold
harmless each Underwriter, the directors, officers, employees and agents of each
Underwriter and each person who controls any Underwriter within the meaning of
either the Act or the Exchange Act to the same extent as the foregoing indemnity
to each Underwriter, but only with reference to written information furnished to
the Company by or on behalf of such Selling Stockholder specifically for use in
the documents referred to in the foregoing indemnity. This indemnity agreement
will be in addition to any liability which any such Selling Stockholder may
otherwise have.
(c) Each Underwriter severally and not jointly agrees to indemnify and hold
harmless the Company, each of its directors, each of its officers who signs the
Registration Statement, and each person who controls the Company within the
meaning of either the Act or the Exchange Act and each Selling Stockholder, to
the same extent as the foregoing indemnity to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the
Company by or on behalf of such Underwriter through the Representatives
specifically for inclusion in the documents referred to in the foregoing
indemnity. This indemnity agreement will be in addition to any liability which
any Underwriter may otherwise have. The Company and each Selling Stockholder
acknowledge that the statements set forth in the last paragraph of the cover
page regarding delivery of the Securities and, under the heading "Underwriting",
the sentences related to concessions and reallowances and the paragraphs related
to stabilization, syndicate covering transactions and penalty bids in any
Preliminary Prospectus and the Prospectus constitute the only information
furnished in writing by or on behalf of the several Underwriters for inclusion
in any Preliminary Prospectus or the Prospectus.
(d) Promptly after receipt by an indemnified party under this Section 8 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a), (b) or (c) above unless and to the extent it did
not otherwise learn of such action and such failure results in the forfeiture by
the indemnifying party of substantial rights and defenses and (ii) will not, in
any event, relieve the indemnifying party from any obligations to any
indemnified party other than the indemnification obligation provided in
paragraph (a), (b) or (c) above. The indemnifying party shall be entitled to
appoint counsel of the indemnifying party's choice at the indemnifying party's
expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as
23
set forth below); provided, however, that such counsel shall be satisfactory
to the indemnified party. Notwithstanding the indemnifying party's election to
appoint counsel to represent the indemnified party in an action, the indemnified
party shall have the right to employ separate counsel (including local counsel),
and the indemnifying party shall bear the reasonable fees, costs and expenses of
such separate counsel if (i) the use of counsel chosen by the indemnifying party
to represent the indemnified party would present such counsel with a conflict of
interest, (ii) the actual or potential defendants in, or targets of, any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii) the
indemnifying party shall not have employed counsel satisfactory to the
indemnified party to represent the indemnified party within a reasonable time
after notice of the institution of such action or (iv) the indemnifying party
shall authorize the indemnified party to employ separate counsel at the expense
of the indemnifying party. An indemnifying party will not, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise or
consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action suit or proceeding.
(e) In the event that the indemnity provided in paragraph (a), (b) or (c)
of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company, the Selling Stockholders and the
Underwriters agree to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in connection
with investigating or defending same) (collectively "Losses") to which the
Company, one or more of the Selling Stockholders and one or more of the
Underwriters may be subject in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Selling Stockholders on the
one hand and by the Underwriters on the other from the offering of the
Securities; provided, however, that in no case shall any Underwriter (except as
may be provided in any agreement among underwriters relating to the offering of
the Securities) be responsible for any amount in excess of the underwriting
discount or commission applicable to the Securities purchased by such
Underwriter hereunder. If the allocation provided by the immediately preceding
sentence is unavailable for any reason, the Company, the Selling Stockholders
and the Underwriters shall contribute in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company, of the Selling Stockholders and of the Underwriters in connection with
the statements or omissions which resulted in such Losses as well as any other
relevant equitable considerations. Benefits received by the Company and by the
Selling Stockholders on the one hand shall be deemed to be equal to the total
net proceeds from
24
(e) the offering (before deducting expenses) received by the Selling
Stockholders, and benefits received by the Underwriters on the other shall be
deemed to be equal to the total underwriting discounts and commissions, in each
case as set forth on the cover page of the Prospectus. Relative fault shall be
determined by reference to, among other things, whether any untrue or any
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information provided by the Company or the
Selling Stockholders on the one hand or the Underwriters on the other, the
intent of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The
Company, the Selling Stockholders and the Underwriters agree that it would not
be just and equitable if contribution were determined by pro rata allocation or
any other method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of this
paragraph (e), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. For purposes of
this Section 8, each person who controls an Underwriter within the meaning of
either the Act or the Exchange Act and each director, officer, employee and
agent of an Underwriter shall have the same rights to contribution as such
Underwriter, and each person who controls the Company within the meaning of
either the Act or the Exchange Act, each officer of the Company who shall have
signed the Registration Statement and each director of the Company shall have
the same rights to contribution as the Company, subject in each case to the
applicable terms and conditions of this paragraph (e). Notwithstanding the
foregoing, no Selling Stockholder shall be obligated to make contributions
hereunder which in the aggregate exceed the amount for which such Selling
Stockholder would have been liable pursuant to paragraph (b), as limited by
paragraph (f), of this Section 8 had indemnification been available thereunder.
(f) The liability of each Selling Stockholder under such Selling
Stockholder's representations and warranties contained in Section 1 hereof and
under the indemnity and contribution agreements contained in this Section 8
shall be limited to an amount equal to the initial public offering price, net of
underwriting discounts, of the Securities sold by such Selling Stockholder to
the Underwriters.
9. Default by an Underwriter. If any one or more Underwriters shall fail to
purchase and pay for any of the Securities agreed to be purchased by such
Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Securities set
forth opposite their names in Schedule I hereto bears to the aggregate amount of
Securities set forth opposite the names of all the remaining Underwriters) the
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase; provided, however, that in the event that the aggregate amount of
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Securities set forth in
25
Schedule I hereto, the remaining Underwriters shall have the right to purchase
all, but shall not be under any obligation to purchase any, of the Securities,
and if such nondefaulting Underwriters do not purchase all the Securities, this
Agreement will terminate without liability to any nondefaulting Underwriter, the
Selling Stockholders or the Company. In the event of a default by any
Underwriter as set forth in this Section 9, the Closing Date shall be postponed
for such period, not exceeding five Business Days, as the Representatives shall
determine in order that the required changes in the Registration Statement and
the Prospectus or in any other documents or arrangements may be effected.
Nothing contained in this Agreement shall relieve any defaulting Underwriter of
its liability, if any, to the Company, the Selling Stockholders and any
nondefaulting Underwriter for damages occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to termination in the
absolute discretion of the Joint Managers, acting jointly, by notice given to
the Company by the Joint Managers, acting jointly, prior to delivery of and
payment for the Securities, if at any time prior to such time (i) trading in the
Company's Common Stock shall have been suspended by the Commission or the Nasdaq
National Market or trading in securities generally on the New York Stock
Exchange or the Nasdaq National Market shall have been suspended or limited or
minimum prices shall have been established on such Exchange or the Nasdaq
National Market, (ii) a banking moratorium shall have been declared either by
Federal or New York State authorities, (iii) there shall have occurred any
outbreak or escalation of hostilities, any attack on or acts of terrorism
involving the United States, declaration by the United States of a national
emergency or war, or other calamity or crisis the effect of which on financial
markets is such as to make it, in the sole judgment of the Joint Managers,
acting jointly, impractical or inadvisable to proceed with the offering or
delivery of the Securities as contemplated by the Prospectus (exclusive of any
supplement thereto), (iv) there shall have occurred any major disruption of
settlements of securities or (v) there shall have occurred any change in United
States or international financial, political or economic conditions or currency
exchange rates or exchange controls as would, in the sole judgment of the Joint
Managers, acting jointly, be likely to prejudice materially the success of the
proposed issue, sale or distribution of the Securities, whether in the primary
market or in respect of dealings in the secondary market.
11. Representations and Indemnities to Survive. The respective agreements,
representations, warranties, indemnities and other statements of the Company or
its officers, of each Selling Stockholder and of the Underwriters set forth in
or made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter, any
Selling Stockholder or the Company or any of the officers, directors, employees,
agents or controlling persons referred to in Section 8 hereof, and will survive
delivery of and payment for the Securities. The provisions of Sections 7 and 8
hereof shall survive the termination or cancellation of this Agreement.
26
12. Notices. All communications hereunder will be in writing and effective
only on receipt, and, if sent to the Representatives, will be mailed, delivered
or telefaxed to Xxxxxxx Xxxxx Barney Inc., General Counsel (fax no.: (212)
000-0000) and confirmed to the General Counsel, Xxxxxxx Xxxxx Xxxxxx Inc., at
000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention: General Counsel and
to Credit Suisse First Boston Corporation, Managing Director, (fax no.: (310)
000-0000) and confirmed to the Managing Director, Credit Suisse First Boston
Corporation, at 2121 Avenue of the Xxxxx/Xxx Xxxxx, Xxx Xxxxxxx, Xxxxxxxxxx,
00000, Attention: Managing Director, and copied to Debevoise & Xxxxxxxx, 000
Xxxxx Xxxxxx, Xxx Xxxx, XX, 00000, Attention: Xxxxx X. Xxxxxxxx, or, if sent to
the Company, will be mailed, delivered or telefaxed to Unilab Corporation (fax
no.: (000) 000-0000) and confirmed to the General Counsel, Unilab Corporation at
00000 Xxxxxx Xxxxxx, Xxxxxxx, XX 00000, Attention: Xxxxx X. Xxx, Esq., or, if
sent to the Selling Stockholders, will be mailed, delivered or telefaxed c/o the
Selling Stockholders to Unilab Corporation (fax no.: (000) 000-0000) and
confirmed to the General Counsel, Unilab Corporation at 00000 Xxxxxx Xxxxxx,
Xxxxxxx, XX 00000, Attention: Xxxxx X. Xxx, Esq. and to Xxxxx & Company (fax
no.: (000) 000-0000) and confirmed to the General Counsel, Xxxxx & Company at
000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000, Attention: Xxxxx X. Xxxxxxx XX,
Esq.
13. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers,
directors, employees, agents and controlling persons referred to in Section 8
hereof, and no other person will have any right or obligation hereunder.
14. Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York applicable to contracts made
and to be performed within the State of New York.
15. Counterparts. This Agreement may be signed in one or more counterparts,
each of which shall constitute an original and all of which together shall
constitute one and the same agreement.
16. Headings. The section headings used herein are for convenience only and
shall not affect the construction hereof.
17. Definitions. The terms which follow, when used in this Agreement, shall
have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and the rules
and regulations of the Commission promulgated thereunder.
"Business Day" shall mean any day other than a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust companies are
authorized or obligated by law to close in New York City.
27
"Commission" shall mean the Securities and Exchange Commission.
"Effective Date" shall mean each date and time that the Registration
Statement, any post-effective amendment or amendments thereto and any Rule
462(b) Registration Statement became or become effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date (which shall be the date of the
Prospectus) and time that this Agreement is executed and delivered by the
parties hereto.
"Preliminary Prospectus" shall mean any preliminary prospectus
referred to in paragraph 1(a) above and any preliminary prospectus included
in the Registration Statement at the Effective Date that omits Rule 430A
Information.
"Prospectus" shall mean the prospectus relating to the Securities that
is first filed pursuant to Rule 424(b) after the Execution Time or, if no
filing pursuant to Rule 424(b) is required, shall mean the form of final
prospectus relating to the Securities included in the Registration
Statement at the Effective Date.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(a) above, including exhibits and financial
statements, as amended at the Execution Time (or, if not effective at the
Execution Time, in the form in which it shall become effective) and, in the
event any post-effective amendment thereto or any Rule 462(b) Registration
Statement becomes effective prior to the Closing Date, shall also mean such
registration statement as so amended or such Rule 462(b) Registration
Statement, as the case may be. Such term shall include any Rule 430A
Information deemed to be included therein at the Effective Date as provided
by Rule 430A.
"Rule 424", "Rule 430A" and "Rule 462" refer to such rules under the
Act.
"Rule 430A Information" shall mean information with respect to the
Securities and the offering thereof permitted to be omitted from the
Registration Statement when it becomes effective pursuant to Rule 430A.
"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b) relating
to the offering covered by the registration statement referred to in
Section 1(a) hereof.
28
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicate hereof, whereupon this
letter and your acceptance shall represent a binding agreement among the
Company, the Selling Stockholders and the several Underwriters.
Very truly yours,
Unilab Corporation
By:
--------------------------
Name:
Title:
By:
--------------------------
Name:
Title:
Xxxxx X. Xxxxx
By:
--------------------------
As Attorney-in-Fact acting on
behalf of the Selling
Stockholders named in
Schedule II hereto and for himself
29
The foregoing Agreement is hereby confirmed and accepted as
of the date first above written.
Xxxxxxx Xxxxx Xxxxxx Inc.
Credit Suisse First Boston Corporation
U.S. Bancorp Xxxxx Xxxxxxx Inc.
By: Xxxxxxx Xxxxx Xxxxxx Inc.
By:
---------------------------
Name:
Title:
By: Credit Suisse First Boston
Corporation
By:
---------------------------
Name:
Title:
For themselves and the other several Underwriters named in
Schedule I to the foregoing Agreement.
SCHEDULE I
Number of Underwritten Securities
Underwriters to be Purchased
------------ ---------------------------------
Xxxxxxx Xxxxx Barney Inc.
Credit Suisse First Boston Corporation
U.S. Bancorp Xxxxx Xxxxxxx Inc.
SCHEDULE II
Maximum Number of
Number of Underwritten Option Securities
Selling Stockholders: Securities to be Sold to be Sold
-------------------- --------------------- -----------------
[name]
[address, fax no.]
[name]
[address, fax no.]
------------- -------------
Total.............
============= =============
*Stock Option Selling Stockholder
[Form of Lock-Up Agreement] EXHIBIT A
[Letterhead of officer/director/stockholder of
Unilab Corporation]
Unilab Corporation
Public Offering of Common Stock
, 2001
Xxxxxxx Xxxxx Barney Inc.
Credit Suisse First Boston Corporation
As Representatives of the
several Underwriters,
c/o Xxxxxxx Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This letter is being delivered to you in connection with the proposed
Underwriting Agreement (the "Underwriting Agreement"), among Unilab Corporation,
a Delaware corporation (the "Company"), and each of you as representatives of a
group of Underwriters named therein, relating to an underwritten public offering
of Common Stock, $.01 par value (the "Common Stock"), of the Company.
In order to induce you and the other Underwriters to enter into the
Underwriting Agreement, the undersigned will not, without the prior written
consent of Xxxxxxx Xxxxx Barney Inc. and Credit Suisse First Boston Corporation,
offer, sell, contract to sell, pledge or otherwise dispose of, (or enter into
any transaction which is designed to, or might reasonably be expected to, result
in the disposition (whether by actual disposition or effective economic
disposition due to cash settlement or otherwise) by the undersigned or any
affiliate of the undersigned or any person in privity with the undersigned or
any affiliate of the undersigned), directly or indirectly, including the filing
(or participation in the filing) of a registration statement with the Securities
and Exchange Commission in respect of, or establish or increase a put equivalent
position or liquidate or decrease a call equivalent position within the meaning
of Section 16 of the Securities Exchange Act of 1934, as amended, and the rules
and regulations of the Securities and Exchange Commission promulgated thereunder
with respect to, any shares of capital
2
stock of the Company or any securities convertible into, or exercisable or
exchangeable for, such capital stock, or publicly announce an intention to
effect any such transaction, for a period of 90 days after the date of the
Underwriting Agreement, other than shares of Common Stock to be sold by the
undersigned pursuant to the Underwriting Agreement and shares of Common Stock
disposed of as bona fide gifts approved by Xxxxxxx Xxxxx Xxxxxx Inc. and Credit
Suisse First Boston Corporation.
If for any reason the Underwriting Agreement shall be terminated prior to
the Closing Date (as defined in the Underwriting Agreement), the agreement set
forth above shall likewise be terminated.
Yours very truly,
[Signature of stockholder/officer/director]
[Name and address of stockholder/officer/director]
EXHIBIT B
[To be provided]
EXHIBIT C
[To be provided]
EXHIBIT D
[To be provided]
EXHIBIT E
[To be provided]
