EXHIBIT 1.1
[ ] SHARES
CTI MOLECULAR IMAGING, INC.
COMMON STOCK, $0.01 PAR VALUE PER SHARE
UNDERWRITING AGREEMENT
, 2002
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CREDIT SUISSE FIRST BOSTON CORPORATION
BANC OF AMERICA SECURITIES LLC
BEAR, XXXXXXX & CO. INC.
FIRST UNION SECURITIES, INC.
U.S. BANCORP XXXXX XXXXXXX, INC.,
As Representatives of the Several Underwriters,
c/o Credit Suisse First Boston Corporation
Eleven Xxxxxxx Xxxxxx,
Xxx Xxxx, XX 00000-0000
Dear Sirs:
1. Introductory. CTI Molecular Imaging, Inc., a Delaware corporation
("COMPANY"), proposes to issue and sell shares of its Common Stock, $0.01
par value per share ("SECURITIES") and the stockholders listed in Schedule A
hereto ("SELLING STOCKHOLDERS") propose severally to sell an aggregate of
outstanding shares of the Securities (such shares of 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 additional shares of its Securities, and certain of the
Selling Stockholders also propose to sell to the Underwriters, at the option of
the Underwriters, an aggregate of not more than additional outstanding shares of
the Company's Securities, as set forth below (such additional shares being
hereinafter referred to as the "OPTIONAL SECURITIES"). The Firm Securities and
the Optional Securities are herein collectively called the "OFFERED SECURITIES".
The Company and the Selling Stockholders hereby agree with the several
Underwriters named in Schedule B hereto ("UNDERWRITERS") as follows:
2. Representations and Warranties of the Company and the Selling
Stockholders. (a) The Company represents and warrants to, and agrees with, the
several Underwriters that:
(i) A registration statement (No. 333-85714) relating to the
Offered Securities, including a form of prospectus, has been filed with
the Securities and Exchange Commission ("COMMISSION") and either (A)
has been declared effective under the Securities Act of 1933 ("ACT")
and is not proposed to be amended or (B) is proposed to be amended by
amendment or post-effective
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amendment. If such registration statement (the "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 the initial registration statement is
filed and including all information (if any) deemed to be a part of the
initial registration statement as of its 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 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.
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(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 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 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
will conform in all material respects to the requirements of the Act
and the Rules and Regulations, and will 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, and no Additional Registration Statement has
been or will be filed. On the date of this Agreement, the Prospectus
does not, and, on any Closing Date, the Prospectus 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 light of the
circumstances under which they were made, not misleading. The three
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.
(iii) The Company has been duly incorporated and is an
existing corporation in good standing under the laws of the State of
Delaware, 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 would not
have a material adverse effect on the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries taken as a whole ("MATERIAL ADVERSE EFFECT").
(iv) Each subsidiary of the Company has been duly
incorporated, or, in the case of limited liability companies and other
entities that are not U.S. corporations, duly organized, and is an
existing corporation, limited liability company or other non-U.S.
entity, as the case may be, in good standing under the laws of the
jurisdiction of its incorporation or organization, 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 or
other entity 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
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to be so qualified would not have, individually or in the aggregate, a
Material Adverse Effect; all of the issued and outstanding capital
stock or other form of membership or ownership interests of each
subsidiary of the Company has been duly authorized and validly issued
and is fully paid and nonassessable; and , except as disclosed in the
Prospectus, the capital stock of each subsidiary owned by the Company,
directly or through subsidiaries, is owned free from liens,
encumbrances and defects.
(v) All outstanding shares of capital stock of the Company
have been duly authorized and validly issued, fully paid and
nonassessable; the Securities conform to the description thereof
contained in the Prospectus; and the stockholders of the Company have
no preemptive rights with respect to the Securities, except for those
rights contained in Section 2.03 of the Securities Purchase Agreement,
dated September 30, 1999, between CTI, Inc. and First Union Capital
Partners, Inc., which rights (1) do not apply to the issuance of the
Offered Securities to be sold by the Company pursuant to this Agreement
and (2) will terminate on the First Closing Date. The Offered
Securities to be sold by the Company have been duly authorized and,
when issued and delivered against payment therefor as provided in this
Agreement, will be validly issued, fully paid and non-assessable.
(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 this offering.
(vii) There are no contracts, agreements or understandings
between the Company and any person granting such person 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 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, except for those rights
set forth in (1) the Registration Rights Agreement, dated September 30,
1999, between CTI, Inc. and First Union Capital Partners, Inc., which
rights have been waived with respect to the transactions contemplated
by this Agreement, and (2) the Stock Purchase and Stockholders'
Agreement, dated January 7, 1988, by and among CTI Group, Inc., CTI,
Inc., Xxxxx X. Xxxxxxxx, Xxxxxx Xxxx, Xxxxxxx Xxxxxxxx, J. Xxxxx Xxxxx
and Siemens Gammasonics, Inc., the terms of which have been satisfied
by the Company with respect to the transactions contemplated by this
Agreement.
(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 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 the Securities Exchange Act of 1934, as amended
("EXCHANGE ACT") and such as may be required under state securities
laws or the bylaws or rules and regulations of the National Association
of Securities Dealers, Inc. ("NASD") and, if the Initial Registration
Statement is not effective under the Act prior to the execution and
delivery of this Agreement, declaration of effectiveness of the Initial
Registration Statement by the Commission.
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(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 by them; 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 by them.
(xiii) The Company and its subsidiaries possess all necessary
certificates, authorities or permits issued by appropriate governmental
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, 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.
(xiv) No labor dispute with the employees of the Company or
any subsidiary exists or, to the knowledge of the Company, is imminent
that could reasonably be expected to have a Material Adverse Effect.
(xv) The Company and its subsidiaries own or are licensed to
use all 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
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. A true and complete list of
patents material to the Company and its subsidiaries' business is set
forth on Schedule C.
(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 investigation which could reasonably be expected to lead
to such a claim.
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(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 have been overtly threatened or, to
the Company's knowledge, are 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 as of the dates shown and
their results of operations and cash flows for the periods shown, and,
except as otherwise noted therein, such financial statements have been
prepared in conformity with the generally accepted accounting
principles in the United States applied on a consistent basis.
(xix) Except as disclosed in the Prospectus, since the date of
the latest audited financial statements included in the Prospectus
there has been no material adverse change, nor any development or event
involving a prospective material adverse change, in the condition
(financial or other), business, properties or results of operations of
the Company and its subsidiaries taken as a whole, 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.
(b) Each Selling Stockholder severally represents and warrants to, and
agrees with, the several Underwriters that:
(i) Such Selling Stockholder has and on each Closing Date
hereinafter mentioned will have valid and unencumbered title to the
Offered Securities to be delivered by such Selling Stockholder on such
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 Stockholder on such Closing
Date hereunder; and upon the delivery of and payment for the Offered
Securities on each Closing Date hereunder the several Underwriters will
acquire valid and unencumbered title to the Offered Securities to be
delivered by such Selling Stockholder on such 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 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
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the Effective Date of the Additional Registration Statement in which
the Prospectus is included, each Registration Statement 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
will conform in all material respects to the requirements of the Act
and the Rules and Regulations and will 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. On the date of this Agreement, the Prospectus does not,
and, on any Closing Date, the Prospectus 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 light of the circumstances
under which they were made, not misleading. The three 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).
Furthermore, in the case of those Selling Stockholders who are not
executive officers or directors of the Company, the first two sentences
of this subparagraph (ii) apply only to the extent any statements in or
omissions from a Registration Statement or the Prospectus are based on
written information furnished to the Company by any such stockholder
specifically for use therein.
(iii) Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between such Selling
Stockholder and any person that would give rise to a valid claim
against such Selling Stockholder or any Underwriter for a brokerage
commission, finder's fee or other like payment in connection with this
offering.
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
Selling Stockholder 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 Stockholder, at a purchase price of $ per
share, that number of Firm Securities (rounded up or down, as determined by
Credit Suisse First Boston Corporation ("CSFBC") in its discretion, in order to
avoid fractions) obtained by multiplying Firm Securities, in the case of the
Company, and the number of Firm Securities set forth opposite the name of such
Selling Stockholder in Schedule A hereto, in the case of a Selling Stockholder,
in each case by a fraction the numerator of which is the number of Firm
Securities set forth opposite the name of such Underwriter in Schedule B hereto
and the denominator of which is the total number of Firm Securities.
Certificates in negotiable form for the Offered Securities to be sold
by the Selling Stockholders hereunder have been placed in custody, for delivery
under this Agreement, under Custody Agreements made with SunTrust Bank, as
custodian ("Custodian"). Each Selling Stockholder agrees that the shares
represented by the certificates held in custody for the Selling Stockholders
under such Custody Agreements are subject to the interests of the Underwriters
hereunder, that the arrangements made by the Selling Stockholders for such
custody are to that extent irrevocable, and that the obligations of the Selling
Stockholders hereunder shall not be terminated by operation of law, whether by
the death of any individual Selling Stockholder 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 Stockholder or any such
trustee or trustees should 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
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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 and the Custodian will deliver the Firm Securities to the
Representatives for the accounts of the Underwriters, against payment of the
purchase price in Federal (same day) funds by official bank check or checks or
wire transfer to an account at a bank acceptable to CSFBC drawn to the order of
CTI Molecular Imaging, Inc. at the office of , at A.M., New
York time, on , 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". For purposes of Rule 15c6-1
under the Securities Exchange Act of 1934, the First Closing Date (if later than
the otherwise applicable settlement date) shall be the settlement date for
payment of funds and delivery of securities for all the Offered Securities sold
pursuant to the offering. 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 at least 24 hours prior to the
First Closing Date.
In addition, upon written notice from CSFBC given to the Company and
the Selling Stockholders 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 and the Selling Stockholders agree, severally and
not jointly, to sell to the Underwriters the respective numbers of Optional
Securities obtained by multiplying the number of Optional Securities specified
in such notice by a fraction the numerator of which is ________, in the case of
the Company, and the number of shares set forth opposite the names of such
Selling Stockholder in Schedule A hereto under the caption "Number of Optional
Securities to be Sold", in the case of the Selling Stockholders, and the
denominator of which is the total number of Optional Securities (subject to
adjustment by CSFBC to eliminate fractions). Such Optional Securities shall be
purchased from the Company and each Selling Stockholder for the account of each
Underwriter in the same proportion as the number of Firm Securities set forth
opposite such Underwriter's name bears to the total number 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 or 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 and the Selling Stockholders.
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 and the Custodian
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 (same day) funds by
official bank check or checks or wire transfer to an account at a bank
acceptable to CSFBC drawn to the order of CTI Molecular Imaging, Inc. at the
[above] office of . The certificates for the Optional Securities
being purchased on each Optional 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 _____________________ at a
reasonable time in advance of such Optional Closing Date.
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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
Stockholders. The Company agrees with the several Underwriters and the Selling
Stockholders 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 fifteenth 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; 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, any event occurs 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 if it is
necessary at any time to amend the Prospectus to comply with the Act,
the Company will promptly notify 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 securityholders 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
9
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 (six 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 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 such 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 for the distribution; 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 other action that would
subject it to service of process in any jurisdiction where it is not
now so subject.
(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 stockholders 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 or
mailed to stockholders, and (ii) from time to time, such other public
information concerning the Company as CSFBC may reasonably request.
(h) For a period of 180 days after the date of the initial public
offering of the Offered Securities, the Company will not offer, sell,
contract to sell, pledge or otherwise dispose of, directly or
indirectly, or file with the Commission a registration statement under
the Act relating to, any additional shares of its Securities or
securities convertible into or exchangeable or exercisable for any
shares of its Securities, or publicly disclose the intention to make
any such offer, sale, pledge, disposition or filing, without the prior
written consent of CSFBC, except issuances of Securities pursuant to
the conversion or exchange of convertible or exchangeable securities or
the exercise of warrants or options, in each case outstanding on the
date hereof, grants of employee stock options pursuant to the terms of
a plan in effect on the date hereof, issuances of Securities pursuant
to the exercise of such options, offers and sales of Securities
pursuant to the terms of the Company's employee stock purchase plan in
effect on the date hereof, and the filing of Registration Statements on
Form S-8 relating to any of the foregoing.
(i) The Company agrees with the several Underwriters that the
Company will pay all expenses incident to the performance of the
obligations of the Company and the Selling Stockholders under this
Agreement, for any filing fees and other expenses (including fees and
disbursements of counsel) 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 incident to the review by the National Association of
Securities Dealers, Inc. of the Offered
10
Securities for any travel expenses of the Company's officers and
employees and any other expenses of the Company in connection with
attending or hosting meetings with prospective purchasers of the
Offered Securities (except for such expenses incurred in connection
with the rental or leasing of aircraft which shall be shared equally
between the Company and the Underwriters), for any transfer taxes on
the sale by the Selling Stockholders 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.
(j) Each Selling Stockholder agrees, for a period of 180 days
after the date of the initial public offering of the Offered
Securities, not to offer, sell, contract to sell, pledge or otherwise
dispose of, directly or indirectly, any additional shares of the
Securities or securities convertible into or exchangeable or
exercisable for any shares of Securities, enter into a transaction
which would have the same effect, or enter into any swap, hedge or
other arrangement that transfers, in whole or in part, any of the
economic consequences of ownership of the Securities, whether any such
aforementioned transaction is to be settled by delivery of the
Securities or such other securities, in cash or otherwise, or publicly
disclose the intention to make any such offer, sale, pledge or
disposition, or enter into any such transaction, swap, hedge or other
arrangement, without, in each case, the prior written consent of CSFBC.
6. Conditions of 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
Stockholders 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 Stockholders 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
PricewaterhouseCoopers LLP 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) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a
review of interim financial information as described in
Statement of Auditing Standards No. 71, Interim Financial
Information, on the unaudited financial statements included in
the Registration Statements;
(iii) on the basis of the review referred to in clause (ii)
above, 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:
11
(A) the unaudited financial statements
included in the Registration Statements 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 any
material modifications should be made to such
unaudited financial statements for them to be in
conformity with generally accepted accounting
principles;
(B) at the date of the latest available
balance sheet read by such accountants, or at a
subsequent specified date not more than three
business 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 net assets, as
compared with amounts shown on the latest balance
sheet included in the Prospectus; or
(C) 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 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 revenues or net
operating income or in the total or per share amounts
of consolidated net income;
except in all cases set forth in clauses (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
(iv) they have compared specified dollar amounts (or
percentages derived from such dollar amounts) and other
financial information contained in the Registration Statements
(in each case to the extent that such dollar amounts,
percentages and other financial 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 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.
12
(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 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 Stockholder, the Company
or the Representatives, shall be contemplated by the Commission.
(c) Subsequent to the execution and delivery 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 other), business, properties or results of operations of
the Company and its subsidiaries taken as one enterprise which, in the
judgment of a majority in interest of the Underwriters including the
Representatives, is material and adverse 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 change in U.S. or international
financial, political or economic conditions or currency exchange rates
or exchange controls as would, in the judgment of a majority in
interest of the Underwriters including the Representatives, be likely
to prejudice materially the success of the proposed issue, sale or
distribution of the Offered Securities, whether in the primary market
or in respect of dealings in the secondary market; (iv) any material
suspension or material 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; (v) any banking moratorium declared by U.S. Federal or New York
authorities; (vi) any major disruption of settlements of securities or
clearance services in the United States or (vii) any attack on,
outbreak or escalation of hostilities or act of terrorism involving the
United States, any declaration of war by Congress or any other 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 attack, outbreak, escalation, act, 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 Xxxxxx & Bird LLP, 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 Delaware, with corporate power and corporate
authority to own its properties and conduct its business as
described in the Prospectus; and the Company is authorized to
transact business as a foreign corporation in the states
specified in the opinion;
13
(ii) Each of Advanced Crystal Technology, Inc., CTI
Pet Systems, Inc., CTI Services, Inc. and X.X.X.Xxx
Pharmaceuticals, Inc. is validly existing as a corporation and
in good standing under the laws of the jurisdiction of its
incorporation, with corporate power and corporate authority to
own its properties and conduct its business as described in
the Prospectus; and each such entity is authorized to transact
business as a foreign corporation in the states specified in
the opinion; all of the issued and outstanding capital stock
of each such entity has been duly authorized, is validly
issued, fully paid and nonassessable, and, except as specified
in the opinion, is owned of record by the Company, to such
counsel's knowledge, free from liens, encumbrances and
defects;
(iii) The Offered Securities delivered on such
Closing Date and all other outstanding shares of the capital
stock of the Company have been duly authorized and validly
issued, are fully paid and nonassessable and conform in all
material respects to the description thereof contained in the
Prospectus; and the stockholders of the Company do not have
any preemptive rights under the Delaware General Corporation
Law, the Company's certificate of incorporation or bylaws, or,
to such counsel's knowledge, any other agreement or instrument
to which the Company is a party or by which the Company is
bound;
(iv) The Company has authorized capital stock as set
forth in the Prospectus. Except as set forth in the
Prospectus, to such counsel's knowledge, there are no
outstanding options, warrants or other rights to subscribe for
or to purchase, any securities or obligations convertible
into, or any contracts or commitments to issue or sell, shares
of the Company's capital stock or any such options, warrants,
rights, convertible securities or obligations;
(v) Except as set forth in Exhibits 10.9 and 10.30 to
the Registration Statement, there are no contracts or
agreements known to such counsel between the Company and any
person granting such person 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 to require the Company to include such securities in
the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to
any other registration statement filed by the Company under
the Act;
(vi) 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, would not be an "investment company" as defined in
the Investment Company Act of 1940;
(vii) No consent, approval, authorization or order
of, or filing with, any federal governmental agency, body or
court or pursuant to the Delaware General Corporation Law is
required to be obtained or made by the Company in connection
with the execution, delivery and performance on the Closing
Date by the Company of this Agreement, except such as have
been obtained and made under the Act and the Exchange Act,
such as may be required under state securities laws and such
as may be required by the NASD;
(viii) The execution, delivery and performance of
this Agreement by the Company on the Closing Date do not
result in a breach or violation of, or constitute a
14
default under, (A) any federal statute, rule, regulation, the
Delaware General Corporation Law or, to such counsel's
knowledge, any order of any governmental agency or body or any
court having jurisdiction over the Company or any subsidiary
of the Company or any of their properties, (B) any agreement
included as an exhibit to the Registration Statement or any
agreement specified in the opinion or (C) the charter or
bylaws of the Company, Advanced Crystal Technology, Inc., CTI
Pet Systems, Inc., CTI Services, Inc. or X.X.X.Xxx
Pharmaceuticals, Inc.;
(ix) 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 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;
(x) 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;
(xi) The statements included in the Prospectus under
the headings "Prospectus Summary - Our Relationship with
Siemens," "Risk Factors - If Siemens exercises its option to
purchase a majority interest in our subsidiary CTI PET
Systems, we will lose a large portion of our revenues,
operations and assets," "Risk Factors - If we fail to comply
with health care regulations, we could face substantial
penalties and our business, operations and financial condition
could be adversely impacted," "Risk Factors - Certain
provisions of our charter, bylaws and Delaware law may delay
or prevent a change in control of our company," "Management's
Discussion and Analysis of Financial Condition and Results of
Operations - Liquidity and Capital Resources" (solely with
respect to the description of the terms of the Company's bank
credit agreement), "Business - Our Relationship with Siemens,"
"Business - Government Regulation" (solely with respect to the
statements under the sub-headings "Reimbursement," "Fraud and
Abuse Laws" and "HIPAA Regulations Relating to the Privacy,
Security, and Electronic Transmission of Health Information"),
"Management - Employment and Change of Control Agreements,"
"Certain Transactions" and "Description of Our Capital Stock,"
insofar as such statements summarize federal statutes, rules
or regulations, the Delaware General Corporation Law, the
Company's certificate of incorporation, the Company's bylaws,
legal or governmental proceedings or contracts discussed
therein, are accurate and fair summaries in all material
respects;
(xii) This Agreement has been duly authorized,
executed and delivered by the Company; and
(xiii) In addition to the matters set forth above,
counsel rendering the foregoing opinion shall also include a
statement to the effect that such counsel has no reason to
believe that any part of a Registration Statement or any
amendment thereto, as of its effective date or as of such
Closing Date, contained any untrue statement of a material
15
fact or omitted to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading or that the Prospectus or any amendment or
supplement thereto, as of its issue date or as of such Closing
Date, contained any untrue statement of a material fact or
omitted to state any material fact necessary in order to make
the statements therein, in the light of the circumstances
under which they were made, not misleading; and such counsel
do not know of any legal or governmental proceedings required
to be described in a Registration Statement or the Prospectus
which are not described as required or of any contracts or
documents of a character required to be filed as exhibits to a
Registration Statement which are not filed as required; it
being understood that such counsel need express no opinion as
to the financial statements or other financial data contained
in the Registration Statements or the Prospectus.
(e) The Representatives shall have received an opinion, dated
such Closing Date, of Xxxxxx & Bird LLP, to the effect that:
(i) Each Selling Stockholder has full right, power
and authority to sell, assign, transfer and deliver the
Securities being sold by such Selling Stockholder under this
Agreement. Immediately prior to the delivery of the Securities
being sold by such Selling Stockholder, such Selling
Stockholder was the sole registered owner of such Securities.
Upon payment by the Underwriters for the Securities to be sold
by each Selling Stockholder, delivery to the Custodian of
certificates representing such Securities, each such
certificate being endorsed by an effective endorsement to Cede
& Co. ("Cede"), as nominee of the Depository Trust Company
("DTC"), registration of such Securities in the name of Cede
and crediting of such Securities by DTC to securities accounts
of the Underwriters, and assuming that neither DTC nor any of
the Underwriters has notice of any "adverse claims" (as
defined in Section 8-102 of the UCC) to such Securities, (i)
DTC will be a "protected purchaser" of such Securities, within
the meaning of Section 8-303 of the UCC; and (ii) under
Section 8-501 of the UCC the Underwriters will acquire
securities entitlements to such Securities credited to their
respective accounts and under Section 8-502 of the UCC no
action based on any "adverse claims" (as defined in Section
8-102 of the UCC) to such Securities, whether framed in
conversion, replevin, constructive trust, equitable lien or
other theory, may be asserted against any of the Underwriters
with respect to such security entitlements. For purpose of the
opinions expressed in this Paragraph (i), we have assumed that
the Custodian, in taking delivery of certificates representing
the Securities to be sold by the Selling Stockholders, will be
acting on behalf of DTC.
(ii) No consent, approval, authorization or order of,
or filing with, any federal governmental agency, body or court
or pursuant to the Delaware General Corporation Law is
required to be obtained or made by any Selling Stockholder in
connection with the execution, delivery and performance on the
Closing Date by such Selling Stockholder of the Custody
Agreement or this Agreement, except such as have been obtained
and made under the Act and the Exchange Act, such as may be
required under state securities laws and such as may be
required by the NASD;
(iii) The execution, delivery and performance of the
Custody Agreement and this Agreement by each Selling
Stockholder on the Closing Date do not result in a breach or
violation of, or constitute a default under, (A) the Delaware
General Corporation Law, any federal statute, rule or
regulation or, to such counsel's knowledge, any order of any
governmental agency or body or any court having jurisdiction
over such Selling Stockholder or any of such Selling
Stockholders' properties, (B) any agreement or instrument
known to such counsel to which such Selling Stockholder is a
party or by which such Selling Stockholder is bound or to
which any of the properties of such Selling Stockholder is
subject, or (C) the organizational documents of any Selling
Stockholder which is not a natural person;
(iv) The Power of Attorney and related Custody
Agreement with respect to each Selling Stockholder has been
duly authorized, executed and delivered by such Selling
Stockholder and constitute valid and legally binding
obligations of each such Selling Stockholder 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;
and
16
(v) This Agreement has been duly authorized, executed
and delivered by each Selling Stockholder.
(f) The Representatives shall have received from Xxxxxxx,
Xxxxxx & Xxxxxxx, L.L.P., special counsel to the Company on U.S. Food &
Drug Administration ("FDA") regulatory matters, an opinion
substantially in the form of that attached as Exhibit A hereto, dated
such Closing Date.
(g) The Representatives shall have received from Xxxxx &
Xxxxxxxx, P.C., special counsel to the Company on intellectual property
matters, an opinion substantially in the form of that attached as
Exhibit B hereto, dated such Closing Date.
(h) The Representatives shall have received from Xxxxx &
Xxxxxxx L.L.P., 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
Stockholders and the Company shall have furnished to such counsel such
documents as they reasonably request for the purpose of enabling them
to pass upon such matters. In rendering such opinion, Xxxxx & Xxxxxxx
L.L.P. may rely as to the incorporation of the Company and all other
matters governed by Delaware law upon the opinion of Xxxxxx & Bird LLP
referred to above.
(i) The Representatives shall have received a certificate,
dated such Closing Date, of the 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 the 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 date of the most recent financial
statements in the Prospectus, there has been no material adverse
change, nor any development or event involving a prospective material
adverse change, in the condition (financial or other), 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.
(j) The Representatives shall have received a letter, dated
such Closing Date, of PricewaterhouseCoopers LLP 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.
(k) The Custodian shall have delivered to CSFBC a letter
stating that they will deliver to each Selling Stockholder a United
States Treasury Department Form 1099 (or other applicable form or
statement specified by the United States Treasury Department
regulations in lieu thereof) on or before January 31 of the year
following the date of this Agreement.
17
(l) On or prior to the date of this Agreement, the
Representatives shall have received lockup letters from each of the
executive officers and directors of the Company who are not Selling
Stockholders, and each holder of shares of Securities set forth on
Schedule D hereto.
The Selling Stockholders 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, its partners, directors and officers and each
person, if any, who controls such Underwriter within the meaning of Section 15
of the Act, 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; provided, further, that
with respect to any untrue statement or alleged untrue statement in or omission
or alleged omission from any preliminary prospectus the indemnity agreement
contained in this subsection (a) shall not inure to the benefit of any
Underwriter from whom the person asserting any such losses, claims, damages or
liabilities purchased the Offered Securities concerned, to the extent that a
prospectus relating to such Offered Securities was required to be delivered by
such Underwriter under the Act in connection with such purchase and any such
loss, claim damage or liability of such Underwriter results from the fact there
was not sent or given to such person, at or prior to the written confirmation of
the sale of such Offered Securities to such person, a copy of the Prospectus if
the Company had previously furnished copies thereof to such Underwriter.
(b) Each of the Selling Stockholders, severally, and not jointly, will
indemnify and hold harmless each Underwriter, its partners, directors and
officers and each person, if any, who controls such Underwriter within the
meaning of Section 15 of the Act, 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 aggregate liability of each Selling Stockholder
pursuant to this Section 7(b) will be limited to an amount equal to the
aggregate proceeds, net of underwriting commissions and discounts, to such
Selling Stockholder from the sale of Securities sold by such Selling Stockholder
to the Underwriters;
18
provided, further, that the Selling Stockholders 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; provided, further,
that in the case of any Selling Stockholders who are not executive officers or
directors of the Company, any such stockholder will not be liable in any such
case unless 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 an in conformity with
written information furnished to the Company by such stockholder for use
therein; provided, further, that with respect to any untrue statement or alleged
untrue statement in or omission or alleged omission from any preliminary
prospectus the indemnity agreement contained in this subsection (b) shall not
inure to the benefit of any Underwriter from whom the person asserting any such
losses, claims, damages or liabilities purchased the Offered Securities
concerned, to the extent that a prospectus relating to such Offered Securities
was required to be delivered by such Underwriter under the Act in connection
with such purchase and any such loss, claim damage or liability of such
Underwriter results from the fact there was not sent or given to such person, at
or prior to the written confirmation of the sale of such Offered Securities to
such person, a copy of the Prospectus if the Company had previously furnished
copies thereof to such Underwriter.
(c) Each Underwriter will severally and not jointly indemnify and hold
harmless the Company, its directors and officers and each person, if any, who
controls the Company within the meaning of Section 15 of the Act, and each
Selling Stockholder against any losses, claims, damages or liabilities to which
the Company or such Selling Stockholder 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 each Selling
Stockholder 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 the following information in the Prospectus furnished on behalf of each
Underwriter: (i) the concession and reallowance figures appearing in the fourth
paragraph under the caption "Underwriting", (ii) the sixth, twentieth and twenty
first paragraphs under the caption "Underwriting" and (iii) with respect to
First Union Securities, Inc., the twelfth and fifteenth paragraphs under the
caption "Underwriting".
(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 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
19
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 (i) includes
an unconditional release of such indemnified party from all liability on any
claims that are the subject matter of such action and (ii) does not include a
statement as to, or an admission of, fault, culpability or a failure to act by
or on behalf of an indemnified party.
(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 Stockholders on the one hand and the Underwriters on the
other from the offering of the Offered 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 Stockholders on the one hand and the Underwriters on the other 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
Stockholders on the one hand and the Underwriters on the other 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 Stockholders 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 Stockholders 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 Offered 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 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 Stockholders under
this Section or Section 9 shall be in addition to any liability which the
Company and the Selling Stockholders 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 hereinafter defined) 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 a Registration Statement and to each
person, if any, who controls the Company within the meaning of the Act.
20
8. Default of Underwriters. If any Underwriter or Underwriters default
in their obligations to purchase Offered Securities hereunder on either the
First or any Optional 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 Stockholders 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 Stockholders 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 Stockholders 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 will
indemnify and hold harmless the QIU against any losses, claims, damages or
liabilities 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 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.
10. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Selling Stockholders, 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
Stockholder, 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 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 Stockholders and the
Underwriters pursuant to Section 7 and the obligations of the Company 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), (v), (vi) or
(vii) 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.
21
11. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed
to the Representatives at Eleven Xxxxxxx Xxxxxx, Xxx Xxxx, XX 00000-0000,
Attention: Transactions Advisory Group, or, if sent to the Company, will be
mailed, delivered or telegraphed and confirmed to it at 000 Xxxxxxxxxx Xxxxx,
Xxxxxxxxx, Xxxxxxxxx 00000, Attention: Xxxxx X. Xxxx, Chief Financial Officer,
or, if sent to the Selling Stockholders or any of them, will be mailed,
delivered or telegraphed and confirmed to _________ at ________; provided,
however, that any notice to an Underwriter pursuant to Section 7 will be mailed,
delivered or telegraphed 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
successors, and the officers and 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 will be binding
upon all the Underwriters. [___________ will act for the Selling Stockholders in
connection with such transactions, and any action under or in respect of this
Agreement taken by _______ will be binding upon all the Selling Stockholders.]
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 hereby submits 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.
22
If the foregoing is in accordance with the Representatives',
understanding of our agreement, kindly sign and return to the Company one of the
counterparts hereof, whereupon it will become a binding agreement among the
Selling Stockholders, the Company and the several Underwriters in accordance
with its terms.
Very truly yours,
SELLING STOCKHOLDERS
[Insert Names]
CTI MOLECULAR IMAGING, INC.
By
----------------------------------
Name:
Title:
The foregoing Underwriting Agreement is hereby
confirmed and accepted as of the
date first above written.
CREDIT SUISSE FIRST BOSTON CORPORATION
BANC OF AMERICA SECURITIES LLC
BEAR, XXXXXXX & CO. INC.
FIRST UNION SECURITIES, INC.
U.S. BANCORP XXXXX XXXXXXX, INC.,
Acting on behalf of themselves and as the
Representatives of the several Underwriters.
By CREDIT SUISSE FIRST BOSTON CORPORATION
By
-------------------------------------
Name:
Title:
23
SCHEDULE A
NUMBER OF
NUMBER OF OPTIONAL
FIRM SECURITIES SECURITIES
SELLING STOCKHOLDER TO BE SOLD TO BE SOLD
------------------- ---------- ----------
24
SCHEDULE B
UNDERWRITER NUMBER OF
----------- FIRM SECURITIES
TO BE PURCHASED
---------------
Credit Suisse First Boston Corporation.............
---------------
Total...................
===============
25
SCHEDULE C
PATENTS MATERIAL TO THE COMPANY AND ITS SUBSIDIARIES
26
SCHEDULE D
Stockholders to Sign Lockup Letters
27
EXHIBIT A
FORM OPINION OF XXXXXXX, XXXXXX & XXXXXXX, L.L.P.,
SPECIAL FDA REGULATORY COUNSEL FOR THE COMPANY
(i) The statements in the Prospectus under the captions "Risk
Factors" and "Business," insofar as such statements purport to summarize
applicable provisions of the Federal Food, Drug, and Cosmetic Act, as amended
(the "FDC Act") and the regulations promulgated thereunder, are accurate
summaries in all material respects of the provisions purported to be summarized
under such captions.
(ii) To our knowledge, there are no Food and Drug Administration
("FDA"), judicial or administrative proceedings pending, or threatened against
the Company, and to our knowledge, the Company has made all material filings,
applications, and submissions required as they relate to FDA approvals,
clearances, and authorizations, except as described in the Registration
Statement and the Prospectus.
(iii) No consent, approval, authorization, clearance or order of the
FDA is required to be obtained by the Company or any of its Subsidiaries in
connection with the offer and sale by the Company of Stock as contemplated by
the Underwriting Agreement.
(iv) The offer and sale by the Company and the Selling Stockholders
of the Offered Securities as contemplated by the Underwriting Agreement will not
conflict with, or result in a breach of, the Federal Food, Drug, and Cosmetic
Act ("FDA Act") or the rules promulgated by the FDA under the FDA Act.
(v) In addition to the matters set forth above, Xxxxxxx, Xxxxxx &
Xxxxxxx, LLP has no reason to believe that any section of the Registration
Statement or any amendment thereto, relating to FDA regulatory matters under the
captions "Risk Factors" and "Business," as of its effective date or as of such
Closing Date, contained any untrue statement of a material fact or omitted to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading or that any section of the Prospectus or any
amendment or supplement thereto relating to FDA regulatory matters under the
captions "Risk Factors" and "Business," as of its issue date or as of such
Closing Date, contained any untrue statement of a material fact or omitted to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading; it
being understood that such counsel need express no opinion as to the financial
statements or other financial data contained in the Registration Statements or
the Prospectus.
28
EXHIBIT B
FORM OPINION OF XXXXX & XXXXXXXX, P.C.
SPECIAL INTELLECTUAL PROPERTY COUNSEL FOR THE COMPANY
(i) Except as set forth in the Prospectus, there are no legal or
governmental proceedings pending relating to patent rights, trade secrets,
trademarks, service marks or other proprietary information or materials
(collectively, "Intellectual Property") of the Company or any of its
subsidiaries, and to such counsel's knowledge no such proceedings are threatened
or contemplated by governmental authorities or others;
(ii) To such counsel's knowledge, the statements in the
Registration Statement and the Prospectus with respect to Intellectual Property
owned or used by the Company and its subsidiaries under the captions "Summary",
"Risk Factors" and "Business" are accurate and complete summaries of the matters
set forth therein;
(iii) Such counsel do not know of any contracts or other documents,
relating to governmental regulation affecting the Company or any of its
subsidiaries or the Company's or any subsidiary's Intellectual Property of a
character required to be filed as an exhibit to the Registration Statement or
required to be described in the Registration Statement or the Prospectus, that
are not filed or described as required;
(iv) To such counsel's knowledge, neither the Company nor any of
its subsidiaries are infringing or otherwise violating any Intellectual Property
rights of others, and to such counsel's knowledge there are no infringements by
others of any of the Company's or any of its subsidiaries' Intellectual Property
rights, which in the judgment of such counsel could affect materially the use
thereof by the Company or any such subsidiary and to such counsel's knowledge,
neither the Company nor any of its subsidiaries has received any written notice
challenging the validity or enforceability of any patents which in the judgment
of such counsel could affect materially the use thereof by the Company or any
subsidiary, except as described in the Prospectus;
(v) The Company and its subsidiaries own the Intellectual Property
described in Schedule C;
(vi) To such counsel's knowledge, the Company and its subsidiaries
own or possess sufficient licenses or other rights to use as necessary to
conduct the business now being or proposed to be conducted by the Company and
its subsidiaries as described in the Prospectus;
(vii) No security interest has been recorded in the Patent and
Trademark Office and, to such counsel's knowledge, is still extant;
(viii) To such counsel's knowledge, no interference has been declared
with respect to any of the U.S. patents and patent applications necessary to
conduct the business now being or proposed to be conducted by the Company and
its subsidiaries, as described in the Prospectus;
(ix) Such counsel is not aware of any facts that would lead such
counsel to conclude that any of the patents or patents for which applications
have been filed which are necessary to conduct the business now being or
proposed to be conducted by the Company and its subsidiaries, as described in
the Prospectus, would be invalid;
29
(x) Such counsel is not aware of any material defects of form in
the preparation or filing of applications for patents which are necessary to
conduct the business now being or proposed to be conducted by the Company and
its subsidiaries, as described in the Prospectus and such applications, are
being diligently pursued by the Company and its subsidiaries; and
(xi) Such counsel shall also state that no facts have come to their
attention that cause such counsel to believe that the Registration Statement or
the Prospectus (i) contained or contains any untrue statement of a material fact
with respect to the Intellectual Property owned or used by the Company and its
subsidiaries, or the manner of its use thereof, or any allegation on the part of
any person that the Company or any of its subsidiaries is infringing any
Intellectual Property rights of any such person or (ii) omitted or omits to any
state any material fact relating to Intellectual Property rights owned or used
by the Company or any of its subsidiaries, or the manner of its use thereof, or
any allegation of which such counsel have knowledge, that is required to be
stated in the Registration Statement or the Prospectus or is necessary to make
the statements therein not misleading.
30
