Exhibit 1.1
VION PHARMACEUTICALS, INC.
3,600,000 Shares of Common Stock
UNDERWRITING AGREEMENT
_____ __, 1999
XXXXX XXXXXX & CO., INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Ladies and Gentlemen:
VION PHARMACEUTICALS, INC., a Delaware corporation (the "Company"),
proposes to sell an aggregate of 3,600,000 shares (the "Firm Shares") of Common
Stock, par value $.01 per share (the "Common Stock"), of the Company, to you
(the "Underwriter"). The Company also has agreed to grant to you an option (the
"Option") to purchase up to an additional 540,000 shares of Common Stock (the
"Option Shares") on the terms and for the purposes set forth in Section l(b)
hereto. The Firm Shares and the Option Shares are hereinafter collectively
referred to as the "Shares." The words "you" and "your" refer to the
Underwriter.
The Company hereby confirms as follows its agreement with the Underwriter.
1. Agreement to Sell and Purchase.
(a) On the basis of the representations, warranties and agreements of the
Company herein contained and subject to all the terms and conditions of this
Agreement, the Company agrees to sell to the Underwriter and the Underwriter
agrees to purchase from the Company at a purchase price of $ ______ per share,
the Firm Shares, plus such additional number of Option Shares which the
Underwriter may become obligated to purchase pursuant to Sections 1(b) hereof.
(b) Subject to all the terms and conditions of this Agreement, the Company
grants the Option to the Underwriter to purchase the Option Shares at the same
price per share as the Underwriter shall pay for the Firm Shares. The Option may
be exercised only to cover over-allotments in the sale of the Firm Shares by the
Underwriter and may be exercised in whole or in part at any time and from time
to time on or before the 30th day after the date of this Agreement (or on the
next business day if the 30th day is not a business day), upon notice (the
"Option Shares Notice") in writing or by telephone (confirmed in writing) by the
Underwriter to the
Company no later than 5:00 p.m., New York City time, at least two and no more
than five business days before the closing date specified in the Option Shares
Notice (the "Option Closing Date") setting forth the aggregate number of Option
Shares to be purchased on the Option Closing Date. (As used herein, "business
day" means a day on which the New York Stock Exchange is open for trading and
on which banks in New York are open for business and not permitted by law or
executive order to be closed.) On the Option Closing Date, the Company will
sell to the Underwriter the number of Option Shares set forth in the Option
Shares Notice.
2. Delivery and Payment.
(a) Delivery of the Firm Shares shall be made to the Underwriter at the
office of the Underwriter, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000,
and in consideration therefor payment of the purchase price shall be made to the
Company by wire transfer of immediately available funds to the Company's account
at [Name and address of financial institution], ABA No. ____________, Account
No. _____________ (the "Closing"). Such delivery and payment shall be made on or
before 10:00 a.m., New York time, on the third business day following the date
of this Agreement, or at such other time and date as may be agreed upon by the
Company and the Underwriter (such date is hereinafter referred to as the
"Closing Date"). Time shall be of the essence, and delivery at the time and
place specified pursuant to this Agreement is a further condition of the
obligations of the Underwriter hereunder.
(b) To the extent the Option is exercised, delivery of the Option Shares
against payment by the Underwriter (in the manner specified above) will take
place at the offices specified above for the Closing at the time and date (which
may be the Closing Date) specified in the Option Shares Notice.
(c) Certificates evidencing the Shares shall be in definitive form and
shall be registered in such names and in such denominations as the Underwriter
shall request at least two business days prior to the Closing Date or the Option
Closing Date, as the case may be, by written notice to the Company. For the
purpose of expediting the checking and packaging of certificates for the Shares,
the Company agrees to make such certificates available for inspection at least
24 hours prior to the Closing Date or the Option Closing Date, as the case may
be.
(d) The cost of original issue tax stamps, if any, in connection with the
issuance, sale and delivery of the Shares by the Company to the Underwriter
shall be borne by the Company. The Company will pay and render the Underwriter
and any subsequent holder of the Shares harmless from any and all liabilities
with respect to or resulting from any failure or delay in paying federal or
state stamp and other transfer taxes, if any, that may be payable in connection
with the issuance, sale or delivery to the Underwriter of the Shares.
3. Representations and Warranties of the Company. The Company represents,
warrants and covenants to the Underwriter that:
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(a) A registration statement on Form S-1 (Registration No. 333-_____)
relating to the Shares, including a preliminary prospectus relating to the
Shares and any amendments to such registration statement as may have been
required prior to the date of this Agreement, has been prepared by the Company
under the provisions of the Securities Act of 1933, as amended (the "Act"), and
the rules and regulations (collectively referred to as the "Rules and
Regulations") of the Securities and Exchange Commission (the "Commission")
promulgated thereunder and has been filed with the Commission. The Commission
has not issued any order preventing or suspending the use of the Prospectus (as
defined below) or any Preliminary Prospectus (as defined below) or instituted
or, to the knowledge of the Company, threatened any proceeding for that purpose.
The term "Preliminary Prospectus" as used herein means a preliminary prospectus
relating to the Shares that is included as part of the foregoing registration
statement or any amendment thereto before the Effective Date (as defined below)
and any prospectus filed with the Commission by the Company pursuant to Rule
424(a) of the Rules and Regulations. Copies of such registration statement and
amendments and of each related Preliminary Prospectus have been delivered to the
Underwriter. If such registration statement has not become effective, a further
amendment to such registration statement, including a form of final Preliminary
Prospectus, necessary to permit such registration statement to become effective
will be filed promptly by the Company with the Commission. If such registration
statement has become effective, a final prospectus relating to the Shares
containing information permitted to be omitted at the time of effectiveness by
Rule 430A of the Rules and Regulations will be filed by the Company with the
Commission in accordance with Rule 424(b) of the Rules and Regulations promptly
after execution and delivery of this Agreement. The term "Registration
Statement" means the registration statement at the time such registration
statement becomes or became effective (the "Effective Date"), together with any
registration statement filed by the Company pursuant to Rule 462(b) of the Rules
and Regulations, including all financial statements and schedules and all
exhibits, documents incorporated therein by reference and all information
contained in any final prospectus filed with the Commission pursuant to Rule
424(b) of the Rules and Regulations or in a term sheet described in Rule 434 of
the Rules and Regulations in accordance with Section 5 hereof and deemed to be
included therein as of the Effective Date by Rule 430A of the Rules and
Regulations. The term "Prospectus" means the prospectus relating to the Shares
as first filed with the Commission pursuant to Rule 424(b) of the Rules and
Regulations or, if no such filing is required, the form of final prospectus
relating to the Shares included in the Registration Statement at the Effective
Date. References herein to any document or other information incorporated by
reference in the Registration Statement shall include documents or other
information incorporated by reference in the Prospectus (or if the Prospectus is
not in existence, in the most recent Preliminary Prospectus). References herein
to any Preliminary Prospectus or the Prospectus shall be deemed to include all
documents and information incorporated by reference therein and shall be deemed
to refer to and include any documents and information filed after the date of
such Preliminary Prospectus or Prospectus, as the case may be, and so
incorporated by reference, under the Securities Exchange Act of 1934, as amended
(the "Exchange Act").
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(b) On the date that any Preliminary Prospectus was filed with the
Commission, the date the Prospectus is first filed with the Commission pursuant
to Rule 424(b) of the Rules and Regulations (if required), at all times
subsequent thereto up to and including the Closing Date and, if later, the
Option Closing Date and when any post-effective amendment to the Registration
Statement becomes effective or any amendment or supplement to the Prospectus is
filed with the Commission, the Registration Statement, each Preliminary
Prospectus and the Prospectus (as amended or as supplemented if the Company
shall have filed with the Commission any amendment or supplement thereto),
including the financial statements included in the Prospectus, did or will
comply in all material respects with all applicable provisions of the Act and
the Rules and Regulations and did or will contain all material statements
required to be stated therein in accordance with the Act and the Rules and
Regulations. On the Effective Date and when any post-effective amendment to the
Registration Statement becomes effective, neither the Registration Statement nor
any such amendment did or will contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary in
order to make the statements therein not misleading. At the Effective Date, the
date the Prospectus or any amendment or supplement to the Prospectus is filed
with the Commission and at the Closing Date and, if later, the Option Closing
Date, the Prospectus did not or will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. The foregoing representations and warranties in this Section 3(b) do
not apply to any statements or omissions made in reliance on and in conformity
with information furnished in writing to the Company by the Underwriter
specifically for inclusion in the Registration Statement or Prospectus or any
amendment or supplement thereto. There are no contracts or other documents
required by the Act or the Rules and Regulations to be filed as exhibits to the
Registration Statement that have not been so filed.
(c) The Company has no subsidiaries. Except as disclosed in the
Registration Statement and the Prospectus, the Company does not own and, at the
Closing Date and the Option Closing Date, if any, will not own, an interest in
any corporation, joint venture, trust, partnership or other business entity. The
Company has been and, at the Closing Date and Option Closing Date, if any, will
be, duly incorporated and validly existing as a corporation under the laws of
the State of Delaware and is, and at the Closing Date and the Option Closing
Date, if any, will be, in good standing under the laws of the State of Delaware.
The Company has all corporate power and authority necessary to own its
properties and conduct its business as currently being carried on and as
described in the Registration Statement and Prospectus. The Company is, and at
the Closing Date and the Option Closing Date, if any, will be, duly licensed or
qualified and in good standing as a foreign corporation in each jurisdiction in
which the character or location of its properties (owned, leased or licensed) or
the nature or conduct of its business or use of its property and assets makes
such licensing or qualification necessary. Complete and correct copies of the
Company's Restated Certificate of Incorporation, as amended (the "Certificate of
Incorporation"), and By-laws have been delivered to the Underwriter or its
counsel, and no changes therein will be made subsequent to the date hereof and
prior to the Closing Date or, if later, the Option Closing Date.
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(d) The outstanding shares of capital stock of the Company have been duly
authorized and validly issued and are fully paid and nonassessable and are not
subject to any preemptive or similar rights, and the holders thereof are not
subject to personal liability by reason of being such holders. The Firm Shares,
the Option Shares in the event the Option is exercised, the warrants (the
"Warrants") issued to the Underwriter or certain permitted designees to purchase
up to 360,000 shares of Common Stock on the terms and conditions set forth in a
Warrant Agreement (the "Warrant Agreement") between the Company and the
Underwriter, and the shares of Common Stock issuable upon exercise of the
Warrants (the "Warrant Shares"), will be duly authorized and, when issued and
delivered (i) to the Underwriter against payment therefor as provided by this
Agreement (in the case of the Shares) or (ii) to the Underwriter or such
designees against payment therefor as provided by the Warrants and the Warrant
Agreement (in the case of the Warrant Shares), will be validly issued, fully
paid and nonassessable and will not be subject to any preemptive or similar
rights, and the holders thereof will not be subject to personal liability by
reason of being such holders. The Company has, and, upon the closing date, will
have, an authorized, issued and outstanding capitalization as set forth in the
Registration Statement and the Prospectus under the captions "Description of
Capital Stock" and "Capitalization" (or, if the Prospectus is not in existence,
in the most recent Preliminary Prospectus). The description of the securities of
the Company in the Registration Statement and the Prospectus under the caption
"Description of Capital Stock" (or, if the Prospectus is not in existence, in
the most recent Preliminary Prospectus) is, and at the Closing Date and, if
later, the Option Closing Date, will be, complete and accurate in all material
respects. Except as set forth or contemplated in the Registration Statement and
the Prospectus (or, if the Prospectus is not in existence, in the most recent
Preliminary Prospectus), the Company does not have outstanding and, at the
Closing Date and, if later, the Option Closing Date, will not have outstanding,
any options to purchase, or any rights or warrants to subscribe for, or any
securities or obligations exchangeable or convertible into, or any contracts or
commitments to issue or sell, any shares of its capital stock or any such
options, rights, warrants, obligations, contracts or commitments. Neither the
filing of the Registration Statement nor the offering or sale of the Shares as
contemplated by this Agreement gives rise to any rights for or relating to the
registration of any shares of Common Stock or other securities of the Company,
except such rights as have been disclosed in the Registration Statement or as
have been satisfied, waived or terminated.
(e) The financial statements and the related notes of the Company included
in the Registration Statement and in the Prospectus (or, if the Prospectus is
not in existence, in the most recent Preliminary Prospectus) comply in all
material respects with the requirements of the Act and the Rules and
Regulations, present fairly the financial condition, results of operations,
stockholders' equity and cash flows of the Company at the dates and for the
periods covered thereby and have been prepared in accordance with United States
generally accepted accounting principles ("GAAP") applied on a consistent basis
throughout the entire periods involved (except as otherwise stated therein),
subject to year-end adjustments with respect to interim information consistent
with past practice. Ernst & Young L.L.P. (the "Accountants"), who have reported
on those of such financial statements and related notes which are audited, are
independent accountants with respect to the Company as required by the Act and
the Rules and Regulations.
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The selected financial information and statistical data set forth under the
captions "Prospectus Summary -- Summary Financial Data" and "Selected Financial
Data" in the Prospectus (or, if the Prospectus is not in existence, in the most
recent Preliminary Prospectus) have been prepared on a basis consistent with the
financial statements of the Company.
(f) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurance that (i) transactions are executed in
accordance with management's general or specific authorization, (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with GAAP and to maintain accountability for assets,
(iii) access to assets is permitted only in accordance with management's general
or specific authorization and (iv) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
(g) Except as set forth or contemplated in the Registration Statement and
Prospectus (or, if the Prospectus is not in existence, in the most recent
Preliminary Prospectus), subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus and prior
to the Closing Date and, if later, the Option Closing Date, (i) there has not
been, and will not have been, any material adverse change in the business,
properties, key personnel, condition (financial or otherwise), net worth or
results of operations of the Company, (ii) the Company has not, and will not
have, incurred any material liabilities or obligations, direct or contingent,
or, entered into any material transactions not in the ordinary course of
business other than pursuant to this Agreement, (iii) the Company has not, and
will not have, paid or declared any dividends or other distributions of any kind
on any class of its capital stock, except the Series A Preferred Stock as
required thereby and described in the Registration Statement and the Prospectus,
and (iv) there has not been, and will not have been, any change in the capital
stock, or a material change in the short-term or long-term debt, or any issuance
of options, warrants, convertible securities or other rights to purchase capital
stock of the Company, other than changes in capital stock and issuances of
rights, options and shares pursuant to the Company's 1993 Amended and Restated
Stock Option Plan and the Senior Executive Stock Option Plan ( the "Option
Plans") or this Agreement.
(h) The Company has good and marketable title to all properties and assets
described in the Registration Statement and Prospectus (or, if the Prospectus is
not in existence, in the most recent Preliminary Prospectus), as owned by it,
free and clear of all liens, security interests, restrictions, pledges,
encumbrances, charges, equities, claims, easements, leases and tenancies
(collectively, "Encumbrances") other than those described or referred to in the
Registration Statement and Prospectus (or, if the Prospectus is not in
existence, in the most recent Preliminary Prospectus). The Company has valid,
subsisting and enforceable leases for the properties and assets described in the
Registration Statement and Prospectus (or, if the Prospectus is not in
existence, in the most recent Preliminary Prospectus) as leased by it, free and
clear of all Encumbrances, other than those described or referred to in the
Registration Statement and Prospectus (or, if the Prospectus is not in
existence, in the most recent Preliminary Prospectus). The Company has no notice
of any claim which has been asserted by anyone
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adverse to the Company's rights as lessee or sublessee under the respective
lease or sublease, or affecting or questioning the Company's right to the
continued possession of the leased or subleased premises.
(i) Except as described or referred to in the Registration Statement or
Prospectus (or, if the Prospectus is not in existence, in the most recent
Preliminary Prospectus), the Company owns or possesses all patents, patent
applications, trademarks, service marks, tradenames, trademark registrations,
service xxxx registrations, copyrights, licenses, inventions, trade secrets and
other intellectual property rights necessary for the conduct of the business of
the Company as currently carried on and as described in the Registration
Statement and Prospectus (or, if the Prospectus is not in existence, in the most
recent Preliminary Prospectus), and except as stated or referred to in the
Registration Statement or Prospectus (or, if the Prospectus is not in existence,
in the most recent Preliminary Prospectus), no name that the Company uses and no
other aspect of the business of the Company involves or gives rise to any
infringement of or license or similar fees for, any patents, trademarks, service
marks, tradenames, trademark registrations, service xxxx registrations, U.S.
registered copyrights, licenses, trade secrets or other similar rights of others
material to the business of the Company, and the Company has not received any
notice alleging any such infringement or fee.
(j) Except as set forth or referred to in the Registration Statement and
Prospectus (or, if the Prospectus is not in existence, in the most recent
Preliminary Prospectus), there are no actions, suits, arbitrations, claims,
governmental or other proceedings (formal or informal), or investigations
pending or, to the knowledge of the Company, threatened against or, to the
knowledge of the Company, affecting the Company, any of the Company's officers
or directors, in its capacity as such, or any of the properties or assets owned
or leased by the Company, before or by any federal, state, municipal or foreign
court, commission, regulatory body, administrative agency or other governmental
body, domestic or foreign (collectively, a "Governmental Body"), including,
without limitation, the United States Food and Drug Administration (the "FDA"),
that might result in any material adverse change in the business, properties,
condition (financial or otherwise), net worth or results of operations of the
Company. Except as set forth in the Registration and the Prospectus, there are
no actions, proceedings or investigations pending or, to the knowledge of the
Company, threatened by the FDA or any other Governmental Body relating to the
safety, efficacy or recall of any product developed or sold by the Company. The
Company is not in violation of, or in default with respect to, any law, rule or
regulation, or any order, judgment or decree, except as described or referred to
in the Prospectus (or if the Prospectus is not in existence, in the most recent
Preliminary Prospectus) or such as in the aggregate do not now have and can
reasonably be expected in the future not to have a material adverse effect upon
the business, properties, condition (financial or otherwise), net worth or
results of operations of the Company; nor is the Company presently required to
take any action under any such order, judgment or decree in order to avoid any
such violation or default.
(k) The Company has, and at the Closing Date and, if later, the Option
Closing Date will have, all governmental licenses, permits, consents, orders,
approvals, franchises, certificates and other authorizations (collectively,
"Licenses") and has made all
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requisite declarations, notifications and filings with all Government Bodies, in
each case as are necessary to carry on its business as then currently conducted
and own or lease its properties as contemplated in the Registration Statement
and Prospectus (or, if the Prospectus is not in existence, in the most recent
Preliminary Prospectus), and all such Licenses are, and at the Closing Date and,
if later, the Option Closing Date will be, in full force and effect. The Company
has, and at the Closing Date and, if later, the Option Closing Date will have,
complied in all material respects with all laws, regulations and orders
applicable to it or its business, assets and properties. The Company is not, nor
at the Closing Date and, if later, the Option Closing Date will it be, in
violation of its Certificate of Incorporation or By-laws, or in default (nor has
any event occurred which, with notice or lapse of time or both, would constitute
a default) in the due performance and observation of any term, covenant or
condition of any indenture, mortgage, deed of trust, voting trust agreement,
loan agreement, bond, debenture, note agreement or other evidence of
indebtedness, lease, contract or other agreement or instrument (collectively, a
"contract or other agreement") to which it is a party or by which its properties
are bound, the violation of which would individually or in the aggregate have a
material adverse effect on the business, properties, prospects, condition
(financial or otherwise), net worth or results of operations of the Company.
There are no governmental proceedings or actions pending or, to the Company's
knowledge, threatened for the purpose of suspending, modifying or revoking any
License held by the Company and, to the knowledge of the Company, no event has
occurred that allows, or with notice or lapse of time or both would allow, any
such suspension, modification or revocation or any material impairment of the
Company's rights thereunder. There has been, however, and may continue to be, an
informal Nasdaq inquiry with respect to the Company's going concern opinion.
(l) No consent, approval, authorization or order of, or any filing or
declaration with, any Governmental Body is required for the execution, delivery
or performance of this Agreement, the Warrants or the Warrant Agreement
(collectively, the "Transaction Documents") or for the consummation of the
transactions contemplated hereby and thereby or in connection with the sale of
the Shares, the Warrants and the Warrant Shares by the Company, except such as
have been obtained and are in full force and effect and such as may be required
under the Act, the Rules and Regulations, any state securities or Blue Sky laws
or the bylaws and rules of the National Association of Securities Dealers, Inc.
(the "NASD") in connection with the purchase and distribution by the Underwriter
of the Shares to be sold hereby, the purchase of the Warrants by the Underwriter
or its permitted designees and the purchase by the Underwriter or such permitted
designees of the Warrant Shares upon exercise of the Warrants.
(m) The Company has full power (corporate and other) and authority to enter
into each of the Transaction Documents and to carry out all the terms and
provisions hereof to be carried out by it. Each of the Transaction Documents has
been duly authorized, executed and delivered by the Company and constitutes a
valid and binding agreement of the Company, and is enforceable against the
Company in accordance with its terms, except as rights to indemnity and
contribution may be limited by federal or state securities laws or the public
policy underlying such laws. Except as disclosed in the Registration Statement
and the Prospectus (or, if the
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Prospectus is not in existence, in the most recent Preliminary Prospectus), the
execution and delivery of the Transaction Documents and the performance and
consummation of the transactions contemplated thereby will not result in the
creation or imposition of any Encumbrance upon any of the properties or assets
of the Company pursuant to the terms or provisions of, or result in a breach or
violation of or conflict with any of the terms or provisions of, or constitute a
default under, or give any other party a right to terminate any of its
obligations under, or result in the acceleration of any obligation under, (i)
the Certificate of Incorporation or By-laws of the Company, or (ii) any contract
or other agreement to which the Company is a party or by which it or any of its
assets or properties are bound, or (iii) any judgment, ruling, decree, order,
law, statute, rule or regulation of any Governmental Body applicable to the
Company or its business or properties, assuming compliance with applicable state
securities and Blue Sky laws.
(n) Each certificate signed by an officer of the Company and delivered to
the Underwriter or counsel for the Underwriter shall be deemed to be a
representation and warranty by the Company to the Underwriter as to the matters
covered thereby.
(o) Neither the Company nor any of its directors, officers or affiliates
(within the meaning of the Rules and Regulations) has taken, nor will he, she or
it take, directly or indirectly, any action designed, or which might reasonably
be expected in the future, to cause or result in, under the Act or otherwise, or
which has constituted, stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Shares or
otherwise.
(p) The Company is not involved in any material labor dispute with its
employees nor is any such dispute threatened or imminent.
(q) Neither the Company nor, to the Company's knowledge, any employee or
agent of the Company has made any payment of funds of the Company or received or
retained any funds of the Company in violation of any law, rule or regulation or
of a character required to be disclosed in the Registration Statement and
Prospectus (or, if the Prospectus is not in existence, in the most recent
Preliminary Prospectus).
(r) The business, operations and facilities of the Company have been and
are being conducted in compliance in all material respects with all applicable
laws, ordinances, rules, regulations, licenses, permits, approvals, plans,
authorizations or requirements relating to occupational safety and health, or
pollution, or protection of health or the environment (including, without
limitation, those relating to emissions, discharges, releases or threatened
releases of pollutants, contaminants or hazardous or toxic substances, materials
or wastes into ambient air, surface water, groundwater or land, or relating to
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of chemical substances, pollutants, contaminants or
hazardous or toxic substances, materials or wastes, whether solid, gaseous or
liquid in nature) of any governmental department, commission, board, bureau,
agency or instrumentality of the United States or any state or political
subdivision thereof, or any foreign jurisdiction, and all applicable judicial or
administrative agency or regulatory decrees, awards, judgments and orders
relating thereto; and the Company has not received any notice from any
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Governmental Body or any third party alleging any violation thereof or material
liability thereunder (including, without limitation, liability for costs of
investigating or remediating sites containing hazardous substances and/or
damages to natural resources). The intended use and occupancy of each of the
facilities owned or operated by the Company complies in all material respects
with all applicable codes and zoning laws and regulations, and there is no
pending or, to the Company's knowledge, threatened condemnation, zoning change,
environmental or other proceeding or action that will in any material respect
adversely affect the size of, use of, improvements on, construction on or access
to such facilities.
(s) The Company has filed all foreign, federal, state and local tax returns
that are required to be filed or has requested extensions thereof and is not in
default in any taxes which were payable pursuant to said returns.
(t) Neither the Company nor any of its directors, officers or employees in
such capacity is subject to any order or directive of, or party to any agreement
with, any regulatory agency having jurisdiction with respect to its business or
operations except as disclosed in the Prospectus (or if the Prospectus is not in
existence, in the most recent Preliminary Prospectus).
(u) The Company and each officer and director of the Company, Xxxxxxx
Associates L.P./Westgate International L.P. and Xxxx Xxxxx have delivered to the
Underwriter agreements (the "Lockup Agreements") to the effect that he or it
will not, for a period of 180 days after the date hereof, without the prior
written consent of the Underwriter, directly or indirectly, offer, sell or
otherwise dispose (or announce any offer, sale, grant of any option to purchase
or other disposition) of any shares of Common Stock or securities convertible
into, or exercisable or exchangeable for, shares of Common Stock, except
pursuant to this Agreement and except for (i) exercises of options and warrants
to acquire shares of Common Stock, (ii) transfers to the holder's spouse or
lineal descendants or ancestors, natural or adopted (collectively, "Relatives"),
or to an inter vivos trust for the benefit of such holder's Relatives, (iii)
transfers upon the death of such holder pursuant to the laws of descent and
distribution or pursuant to xxxxx, or (iv) gifts, provided that, in the case of
the foregoing clauses (i) through (iv), the transferee agrees in writing to be
bound by the terms of these restrictions.
(v) The Company has not distributed and will not distribute any prospectus
or other offering material in connection with the offering and sale of the
Shares other than any Preliminary Prospectus or the Prospectus or other
materials permitted by the Act or the Rules and Regulations to be distributed by
the Company.
(w) The Common Stock of the Company is quoted on The Nasdaq [SmallCap]
[National] Market.
(x) The Company is not required to be registered under the Investment
Company Act of 1940, as amended (the "Investment Company Act").
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(y) The Company has furnished the Underwriter with true and complete copies
of its Current Reports on Form 8-K filed on July 15, 1999 and April 28, 1998,
its report on Form 10-KSB for the fiscal year ended December 31, 1998 and all
amendments thereto, its Quarterly Report on Form 10-QSB for the fiscal quarter
ended March 31, 1999, its Proxy Statement for use in connection with its 1999
Annual Meeting of Stockholders and its 1998 Annual Report to Stockholders and
(the "Current Reports"). In addition, the Company has furnished the Underwriter
with true and complete copies of its Amended Quarterly reports filed on May 17,
1999, February 5, 1999 and January 8, 1999, which relate to quarterly periods
prior to December 31, 1998 (the "Amended Reports"). The Current Reports and the
Amended Reports constitute the only documents that the Company was required to
file with the Commission since December 31, 1998. The Company has also filed all
other reports required to be filed with the Commission prior to March 31, 1999
(such reports, together with the Current Reports are collectively referred to as
the "Commission Reports"). As of their respective filing dates, the Commission
Reports and all other filings made by the Company under the Act or Exchange Act
complied in all material respects with the requirements of the Act or the
Exchange Act, as the case may be, and none of such filings 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, in light of the
circumstances under which they were made, not misleading.
(z) Since its inception, the Company has not incurred any material
liability resulting from a violation of the provisions of the Act or any state
securities or Blue Sky laws.
(aa) The Company has made available to the Underwriter a copy of all
filings submitted to and letters received from the FDA and all related documents
and information.
(bb) The Company carries, or is covered by, insurance in such amounts and
covering such risks as is adequate in accordance with customary industry
standards for the conduct of its business and the value of its properties.
(cc) The Company is in compliance in all material respects with all
presently applicable provisions of the Employee Retirement Income Security Act
of 1974, as amended, including the regulations and published interpretations
thereunder ("ERISA"); no "reportable event" (as defined in ERISA) has occurred
with respect to any "pension plan" (as defined in ERISA) for which the Company
would have any material liability; the Company has not incurred and does not
expect to incur liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any "pension plan" or (ii) Sections 412 or
4971 of the Internal Revenue Code of 1986, as amended, including the regulations
and published interpretations thereunder (the "Code"); and each "pension plan"
for which the Company would have any liability that is intended to be qualified
under Section 401(a) of the Code is so qualified in all material respects and
nothing has occurred, whether by action or by failure to act, which would cause
the loss of such qualification.
4. Representations and Warranties of the Underwriter. Upon your
authorization of the release of the Firm Shares, the Underwriter proposes to
offer the Firm Shares for sale to the
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public upon the terms set forth in the Prospectus. The Underwriter represents
and warrants to the Company that, assuming compliance by the Company with all
relevant provisions of the Act in connection with the Registration Statement,
the Underwriter will conduct all offers and sales of the Shares in compliance
with the relevant provisions of the Act and the Rules and Regulations, all
applicable state securities laws and regulations and the bylaws and rules of the
NASD. The Underwriter represents and warrants to the Company that the
Underwriter is authorized to enter into this Agreement and to act in the manner
provided in this Agreement.
5. Agreements of the Company. The Company covenants and agrees with the
Underwriter as follows:
(a) The Company will not, either prior to the Effective Date or thereafter
during such period as the Prospectus is required by law to be delivered in
connection with sales of the Shares by the Underwriter or a dealer, file any
amendment or supplement to the Registration Statement or the Prospectus, unless
a copy thereof shall first have been submitted to the Underwriter and the
Underwriter shall have consented thereto, which consent shall not be
unreasonably withheld.
(b) If the Registration Statement is not yet effective, the Company will
use its best efforts to cause the Registration Statement to become effective not
later than the time indicated in Section 7(a) hereof. The Company will notify
the Underwriter promptly, and will confirm such advice in writing, (i) when the
Registration Statement has become effective (if later than the date hereof) and
when any post-effective amendment thereto becomes effective, (ii) of any request
by the Commission for amendments or supplements to the Registration Statement or
the Prospectus or for additional information, (iii) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or any post-effective amendment thereto or any order suspending the
use of any Preliminary Prospectus or the Prospectus or any amendment or
supplement thereto or the initiation of any proceedings for any such purpose or
the threat thereof, (iv) of the happening of any event during the period
mentioned in the first sentence of Section 5(f) that in the reasonable judgment
of the Company makes any statement of a material fact made in the Registration
Statement or the Prospectus untrue or that requires the making of any changes in
the Registration Statement or the Prospectus in order to make the statements of
material fact therein, in light of the circumstances in which they are made, not
misleading and (v) of receipt by the Company or the Underwriter or attorney of
the Company during the period mentioned in the first sentence of Section 5(f) of
any other communication from the Commission relating to the Company, the
Registration Statement, any Preliminary Prospectus or the Prospectus. The
Company will use its best efforts to prevent the issuance of any order
suspending the effectiveness of the Registration Statement or any post-effective
amendment thereto or any order suspending the use of any Preliminary Prospectus
or the Prospectus or any amendment or supplement thereto, and, if any such order
is issued, the Company will use its best efforts to obtain the withdrawal of
such order at the earliest possible moment. The Company will prepare the
Prospectus in a form approved by the Underwriter and will file such Prospectus
pursuant to Rule 424(b) of the Rules and Regulations not later than the
Commission's close of business on the second business day following the
execution and delivery
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of this Agreement or, if applicable, such earlier time as may be required by
Rule 430A(a)(3) of the Rules and Regulations. If the Company has omitted any
information from the Registration Statement pursuant to Rule 430A of the Rules
and Regulations, the Company will use its best efforts to comply with the
provisions of and make all requisite filings with the Commission pursuant to
Rule 430A of the Rules and Regulations and to notify the Underwriter promptly of
all such filings.
(c) If, at any time when a Prospectus relating to the Shares is required to
be delivered under the Act, any event has occurred as a result of which the
Prospectus, as then amended or supplemented, would include any untrue statement
of a material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, or the Registration Statement, as then amended or
supplemented, would include any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein not misleading,
or if for any other reason it is necessary at any such time to amend or
supplement the Prospectus or the Registration Statement to comply with the Act
or the Rules and Regulations, the Company will promptly notify the Underwriter
thereof and, in accordance with Section 5(a) hereof, will prepare and file with
the Commission, at the Company's expense, an amendment to the Registration
Statement or an amendment or supplement to the Prospectus that corrects such
statement or omission or effects such compliance.
(d) The Company will furnish to the Underwriter, without charge, three
signed copies of the Registration Statement and of any post-effective amendment
thereto, including financial statements and schedules, and all exhibits thereto,
other than exhibits incorporated by reference, and will furnish to the
Underwriter, without charge, copies of the Registration Statement and any
post-effective amendment thereto, including financial statements and schedules
but without exhibits.
(e) The Company will comply with all the provisions of all undertakings
contained in the Registration Statement.
(f) On the Effective Date, and thereafter from time to time for such period
as the Prospectus is required by the Act to be delivered, the Company will
deliver to the Underwriter, without charge, as many copies of the Prospectus or
any amendment or supplement thereto as the Underwriter may reasonably request.
The Company consents to the use of the Prospectus or any amendment or supplement
thereto by the Underwriter and by all dealers to whom the Shares may be sold,
both in connection with the offering or sale of the Shares and for any period of
time thereafter during which the Prospectus is required by law to be delivered
in connection therewith. If during such period of time any event shall occur
which in the judgment of the Company or counsel to the Underwriter should be set
forth in the Prospectus in order to make any statement of a material fact
therein, in the light of the circumstances under which it was made, not
misleading, or in the Registration Statement in order to make any statement of a
material fact therein not misleading, or if it is necessary to supplement or
amend the Prospectus or the Registration Statement to comply with law, the
Company will, in accordance with Section
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5(a) hereof, forthwith prepare and duly file with the Commission an appropriate
supplement or amendment thereto and will deliver to the Underwriter, without
charge, such number of copies thereof as the Underwriter may reasonably request.
(g) The Company will (i) take or cause to be taken all such actions and
furnish all such information as the Underwriter may reasonably request in order
to qualify the Shares for offer and sale under the state securities or Blue Sky
laws of such jurisdictions as the Underwriter may designate, (ii) continue such
qualifications in effect for as long as may be necessary to complete the
distribution of the Shares but not to exceed one year from the date of this
Agreement and (iii) make such applications, file such documents and furnish such
information as may be required for the purposes set forth in the foregoing
clauses (i) and (ii); provided, that in no event shall the Company be obligated
to qualify to do business in any jurisdiction where it is not now so qualified
or to take any action which would subject it to general service of process or to
taxation in any jurisdiction where it is not now so subject.
(h) For a period of five years commencing on the Effective Date, the
Company will furnish to the Underwriter upon request copies of such financial
statements and other periodic and special reports as the Company may, from time
to time, distribute generally to the holders of any class of its capital stock
and will furnish to the Underwriter upon request a copy of each annual or other
report it shall be required to file with the Commission.
(i) The Company will make generally available to holders of its securities,
as soon as may be practicable, but in no event later than the last day of the
fifteenth full calendar month following the calendar quarter in which the
Effective Date falls, an earnings statement (which need not be audited but shall
be in reasonable detail) for a period of 12 months commencing after the
Effective Date, and satisfying the provisions of Section 11(a) of the Act
(including Rule 158 of the Rules and Regulations).
(j) The Company will not for a period of 180 days after the date hereof,
without the prior written consent of the Underwriter, directly or indirectly,
offer, sell or otherwise dispose (or announce any offer, sale, grant of any
option to purchase or other disposition) of any shares of Common Stock or any
securities convertible into, or exercisable or exchangeable for, shares of
Common Stock, except pursuant to Section 1 hereof and except that the Company
may grant options, and issue shares pursuant to the options granted, under the
Option Plans and the Company may issue shares pursuant to warrants, options and
shares of convertible preferred stock outstanding as of the date of this
Agreement and warrants issued to the Underwriter or permitted designees.
(k) The Company will not at any time, directly or indirectly, take any
action intended, or that might reasonably be expected, to cause or result in, or
that will constitute, stabilization of the price of the Common Stock to
facilitate the sale or resale of any of the Shares.
(l) The Company shall apply the net proceeds of the sale of the Shares as
set forth in the Prospectus.
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(m) The Company shall not invest, or otherwise use, the proceeds received
by the Company from the sale of the Shares to the Underwriter in such a manner
as would require the Company to register as an investment company under the
Investment Company Act.
(n) The Company will maintain a transfer agent and, if necessary under the
jurisdiction of incorporation of the Company or if required by The Nasdaq Stock
Market, Inc., a registrar for its Common Stock.
(o) The Company will timely file all such reports, forms or other documents
as may be required from time to time under the Act, the Rules and Regulations,
the Exchange Act, and the rules and regulations promulgated thereunder, and all
such reports, forms and documents filed will comply in all material respects as
to form and substance with the applicable requirements of the Act, the Rules and
Regulations, the Exchange Act, and the rules and regulations promulgated
thereunder.
6. Expenses. Whether or not the transactions contemplated by this Agreement
are consummated or this Agreement is terminated, the Company will pay, or
reimburse if paid by the Underwriter, all costs and expenses incident to the
performance of its obligations under this Agreement and the transactions
contemplated by this Agreement, including, but not limited to, costs and
expenses of or relating to (i) the preparation, printing and filing of the
Registration Statement and exhibits thereto, each Preliminary Prospectus, the
Prospectus, any amendment or supplement to the Registration Statement or the
Prospectus, (ii) the preparation and delivery of certificates representing the
Shares, (iii) the printing of this Agreement, the Warrant Agreement, any Dealer
Agreements and any Underwriter's Questionnaire, (iv) furnishing (including costs
of shipping and mailing) such copies of the Registration Statement, the
Prospectus and any Preliminary Prospectus, and all amendments and supplements
thereto, as may be requested for use in connection with the offering and sale of
the Shares by the Underwriter or by dealers to whom Shares may be sold, (v) the
quotation of the Shares on The Nasdaq Stock Market, (vi) any filings required to
be made by the Underwriter with the NASD, (vii) the registration or
qualification of the Shares for offer and sale under the securities or Blue Sky
laws of such jurisdictions designated pursuant to Section 5(g) hereof, including
the reasonable fees, disbursements and other charges of counsel to the
Underwriter in connection therewith, and the preparation and printing of
preliminary, supplemental and final Blue Sky memoranda, (viii) counsel and
accountants to the Company and (ix) the transfer agent, and any registrar, for
the Shares. Whether or not the transactions contemplated by this Agreement are
consummated or this Agreement is terminated, the Company will reimburse the
Underwriter for all of its accountable out-of-pocket fees and expenses,
including legal fees, incurred by it in connection herewith, up to an aggregate
amount of $125,000.
7. Conditions to the Obligations of the Underwriter. The obligations of the
Underwriter hereunder are subject to the following conditions:
(a) Notification that the Registration Statement has become effective shall
be received by the Underwriter not later than 4:00 p.m., New York time, on the
date immediately
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preceding the date of this Agreement or at such later date and time as shall be
consented to in writing by the Underwriter and all filings required prior to
such effectiveness by Rule 424 and Rule 430A of the Rules and Regulations shall
have been made.
(b) (i) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall be
pending or threatened by the Commission, (ii) no order suspending the
effectiveness of the Registration Statement or the qualification or registration
of the Shares under the securities or Blue Sky laws of any jurisdiction shall be
in effect, and no proceeding for such purpose shall be pending before or
threatened or contemplated by the authorities of any such jurisdiction, (iii)
any request for additional information on the part of the staff of the
Commission or any such authorities shall have been complied with to the
satisfaction of the staff of the Commission or such authorities and (iv) after
the date hereof no amendment or supplement to the Registration Statement or the
Prospectus shall have been filed unless a copy thereof was first submitted to
the Underwriter and the Underwriter consented thereto, such consent not to be
unreasonably withheld, and the Underwriter shall have received certificates,
dated the Closing Date and the Option Closing Date, if any, and signed on behalf
of the Company by the Chief Executive Officer of the Company and the Chief
Financial Officer of the Company (who may, as to proceedings threatened, rely
upon the best of their information and belief), to the effect of the foregoing
clauses (i), (ii) and (iii).
(c) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, (i) there shall not have been a
material adverse change in the general affairs, business, business prospects,
properties, management, condition (financial or otherwise), or results of
operations of the Company, whether or not arising from transactions in the
ordinary course of business, and (ii) the Company shall not have sustained any
material loss or interference with its business, assets or properties from fire,
explosion, flood or other casualty, whether or not covered by insurance, or from
any labor dispute or any court or legislative or other governmental action,
order or decree, which is not set forth in the Registration Statement and the
Prospectus.
(d) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there shall have been no litigation
or other proceeding instituted against the Company or any of its officers,
directors or stockholders in their capacities as such, or any of its assets or
properties, before or by any Governmental Body in which litigation or proceeding
an unfavorable ruling, decision or finding would materially and adversely affect
the general affairs, business, properties, prospects, condition (financial or
otherwise), net worth or results of operations of the Company.
(e) Each of the representations and warranties of the Company contained
herein shall be true and correct in all material respects at the date hereof, at
the Closing Date and, with respect to the Option Shares, if any, at the Option
Closing Date, as if made on such date, and all covenants and agreements
contained herein to be performed on the part of the Company and all conditions
contained herein to be fulfilled or complied with by the Company at or prior to
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the Closing Date and, with respect to the Option Shares, if any, at or prior to
the Option Closing Date, shall have been fully performed, fulfilled or complied
with in all material respects.
(f) The Underwriter shall have received an opinion, dated the Closing Date
and the Option Closing Date, as applicable, from Fulbright & Xxxxxxxx, L.L.P.,
New York, New York, counsel for the Company, to the following effect:
(i) The Company has been duly incorporated and is validly existing and
in good standing under the laws of the State of Delaware;
(ii) The Company is duly licensed or qualified and in good standing as
a foreign corporation in each state in which it owns or leases property.
(iii) The authorized capital stock of the Company conforms in all
material respects as to legal matters to the description contained in the
Prospectus. The authorized capital stock of the Company is as set forth in the
Prospectus under the caption "Capitalization". All of the issued and outstanding
shares of Common Stock have been, and the Shares, the Warrants and the Warrant
Shares, when issued, delivered and paid for (A) by the Underwriter in accordance
with the terms of this Agreement (in the case of the Shares) or (B) by the
Underwriter or its permitted designees in accordance with the terms of the
Warrants and the Warrant Agreement (in the case of the Warrants and the Warrant
Shares), will be, duly authorized, validly issued, fully paid and nonassessable
and will not be subject to any preemptive or similar right arising under the
Delaware General Corporation Law, as amended, the Company's Certificate of
Incorporation or By-laws, or any agreement listed as an Exhibit to the
Registration Statement (the "Exhibits"). To such counsel's actual knowledge,
neither the filing of the Registration Statement nor the offering or sale of the
Shares pursuant to this Agreement gives rise to any rights for the registration
of any shares of Common Stock or other securities of the Company pursuant to any
of the Exhibits, except as disclosed in the Registration Statement, or such
rights as have been satisfied, waived or terminated;
(iv) Based on such counsel's review of the minutes of the meetings of
the Company's stockholders and board of directors and committees of the board of
directors and a certificate of officers of the Company (the "Certificate"),
except as described in the Registration Statement and the Prospectus, there are
no options, warrants, agreements, contracts or other rights in existence to
purchase or acquire from the Company any shares of capital stock of the Company;
(v) The Registration Statement has become effective under the Act,
and, to such counsel's actual knowledge, (A) no stop order suspending the
effectiveness of the Registration Statement or any amendment thereto has been
issued under the Act, and (B) no proceedings for that purpose have been
instituted, are pending or are threatened by the Commission under the Act;
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(vi) The Registration Statement and, if any, each amendment thereto
and the Prospectus and, if any, each amendment and supplement thereto (except
the financial statements, schedules and other financial data contained therein,
as to which such counsel need not express any opinion), complies as to form in
all material respects with the requirements of the Act and Rules and
Regulations;
(vii) The descriptions of statutes, litigation, contracts and other
documents, insofar as such descriptions relate to matters of law, contained in
the Registration Statement and in the Prospectus under the captions "Risk
Factors -- Effect of anti-takeover provisions could inhibit the acquisition of
Vion," "Business -- Research and Development," "Management Our Executive
Officers and Directors," "-- Executive Compensation," and "-- Indemnification of
Directors and Officers," "Related Party Transactions," and "Description of
Capital Stock" fairly present in all material respects summaries of the
information required to be shown;
(viii) To such counsel's actual knowledge, there are no contracts or
documents which are required by the Act to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the Registration
Statement which are not so described or filed;
(ix) Based solely on the Certificate and the results of an inquiry of
the partners of such counsel's firm (the "Inquiry"), to such counsel's actual
knowledge, there is not pending or threatened against the Company any action,
suit, arbitration, claim, governmental or other proceeding (informal or formal)
or investigation before or by any Governmental Body which is required to be
disclosed in the Registration Statement or the Prospectus which is not so
disclosed therein;
(x) The Company has the corporate power and authority to execute,
deliver and comply with its obligations under each of the Transaction Documents
and to consummate the transactions provided for therein; and the execution and
delivery by the Company of, and the performance by the Company under, each of
the Transaction Documents have been duly authorized by all requisite corporate
action on behalf of the Company, and such counsel shall confirm to you that each
of the Transaction Documents has been executed and delivered on behalf of the
Company by a duly authorized officer of the Company.
(xi) The execution and delivery of the Transaction Documents by the
Company, and the Company's compliance with the terms of the Transaction
Documents (A) do not result in the creation or imposition of any Encumbrance
upon any property or assets of the Company pursuant to the terms or provisions
of, or constitute a breach of, or default under, any material contract or other
material agreement included as an Exhibit to the Registration Statement, and (B)
do not violate (x) the Certificate of Incorporation or By-laws of the Company,
(y) any laws which are known to such counsel to be applicable to the Company
where such violation would reasonably be expected to have a material adverse
effect on the validity, performance or enforceability of any of the terms of
this Agreement applicable to the Company
-18-
or relating to the rights and remedies of the Underwriter under the Transaction
Documents or (z) based solely on the Certificate and the Inquiry, any of the
Company's existing obligations under any judgment, decree or order of any
arbitrator or Governmental Body naming the Company; no consent, approval,
authorization or order of, or filing with, any Governmental Body is legally
required for the execution, delivery and performance of any Transaction Document
by the Company, other than for the registration of shares issuable upon the
Warrants the terms of which are set forth in the Warrant Agreement, except such
as may be required under the Act and the Rules and Regulations, such as may be
required by the bylaws and rules of the NASD in connection with the purchase and
distribution by the Underwriter of the Shares, the purchase by the Underwriter
or its permitted designees of the Warrants or the purchase of the Warrant Shares
upon exercise of the Warrants and such as may be required under state securities
or Blue Sky laws in connection with the purchase and distribution by the
Underwriters of the Shares, the purchase by the Underwriter or such designees of
the Warrants or the purchase of the Warrant Shares upon exercise of the
Warrants;
(xii) To such counsel's actual knowledge, the Company is not in any
breach or violation of any of the terms or provisions of, or in default under
(nor has an event occurred which with notice or lapse of time or both would
constitute a default or acceleration under), the terms of its Certificate of
Incorporation [or By-laws];
(xiii) To such counsel's actual knowledge, the Company is not an
"investment company" as such term is defined in the Investment Company Act.
In addition, such counsel shall state that in the course of the preparation
of the Registration Statement and the Prospectus, such counsel has participated
in conferences with officers and other representatives of the Company,
representatives of the independent accountants of the Company, representatives
of the Underwriter and representatives of counsel for the Underwriter, at which
the contents of the Registration Statement and the Prospectus and related
matters were discussed and at which such counsel inquired of the representatives
of the Company as to the materiality of the facts disclosed to such counsel and,
although such counsel does not pass upon, and does not assume any responsibility
for, the accuracy, completeness or fairness of any statement contained in the
Registration Statement or the Prospectus and such counsel has made no
independent check or verification thereof, based, in part, upon the foregoing
(relying as to materiality to a large extent upon the officers and
representatives of the Company), no facts have come to such counsel's attention
that have led such counsel to believe that the Registration Statement (except as
to the financial statements and notes thereto and other financial data included
therein or excluded therefrom as to which such counsel need not express any
opinion or belief), as of the date of effectiveness contained an untrue
statement of material fact or omitted to state any material fact required to be
stated therein or necessary in order to make the statements therein not
misleading or that the Prospectus (except as to the financial statements and the
notes thereto and other financial data included therein or excluded therefrom as
to which such counsel need not express any opinion or belief), as of its date or
as of the date of such opinion, contained or contains an untrue statement of
material fact or omitted or omits to state a material
-19-
fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
In rendering any such opinion, such counsel may (i) state that such counsel
expresses no opinion as to the laws of any jurisdiction other than the laws of
the State of New York, the Delaware General Corporation Law and the federal laws
of the United States and expresses no opinion concerning the FD&C Act (as
defined below) or related rules and regulations or any intellectual property law
and (ii) may rely, as to matters of fact on certificates of responsible officers
of the Company and public officials.
References to the Registration Statement and the Prospectus in this
paragraph (f) shall include any amendment or supplement thereto at the date of
such opinion.
(g) The Underwriter shall have received an opinion, dated the Closing Date
and the Option Closing Date, as applicable, from Xxxxxx & Xxxxxxx LLP, New York,
New York, patent counsel for the Company, to the following effect:
(i) The statements set forth in the Registration Statement and the
Prospectus, under the captions "Risk Factors -- We depend heavily on patents
and trade secrets which may not adequately protect our technologies from use by
others" and "Business -- Patents, Licenses and Trade Secrets" (the "Intellectual
Property Portion") are accurate summaries in all material respects of the
provisions purported to be summarized under such captions in the Registration
Statement and the Prospectus, and of any legal matters, documents and
proceedings referred to therein;
(ii) As of the date of such opinion, the Company is recorded in the
records of the United States Patent and Trademark Office as the sole owner or
assignee of record of each of the issued patents noted on an appendix to such
opinion (the "Patents"), and each of the patent applications noted on such
appendix was so assigned and recorded at the time of filing (the "Patent
Applications"). To the actual knowledge of such counsel, there have not been any
subsequent recorded assignments and there are no asserted or unasserted claims
by any person relating to the scope or ownership of the Patents or Patent
Applications, there is no material defect of form in the preparation or filing
of the Patent Applications and the applications that led to the Patents and,
unless otherwise specifically noted in such opinion or on an appendix thereto,
none of the Patent Applications are on this date under final rejection;
(iii) To such counsel's actual knowledge, there is no litigation
pending or threatened (whether orally or in writing) against the Company
alleging that any of the Company's products or proposed products infringe or
will infringe any patent, copyright, trademark, trade secret or other
intellectual property rights of any third party and no litigation pending or
stated to be threatened (whether orally or in writing) against the Company at
this time relating to the Patents, the Patent Applications, or to any copyright,
trademark, trade secret or other intellectual property right owned by the
Company; and
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(iv) To such counsel's actual knowledge, there is no fact or
circumstance that would form a basis for the belief that any of the Patents are
either invalid or unenforceable.
In rendering any such opinion, such counsel may (i) state that such counsel
expresses no opinion as to the laws of any jurisdiction other than the federal
laws of the United States and (ii) may rely, as to matters of fact on
certificates of responsible officers of the Company and public officials.
References to the Registration Statement and the Prospectus in this
paragraph (g) shall include any amendment or supplement thereto at the date of
such opinion.
(h) The Underwriter shall have received an opinion, dated the Closing Date
and the Option Closing Date, as applicable, from Piper & Marbury L.L.P., counsel
to the Underwriter, which opinion shall be satisfactory in all respects to the
Underwriter.
(i) Concurrently with the execution and delivery of this Agreement, or, if
the Company elects to rely on Rule 430A of the Rules and Regulations, on the
date of the Prospectus, the Accountants shall have furnished to the Underwriter
a letter, dated the date of its delivery (the "Original Letter"), addressed to
the Underwriter and in form and substance satisfactory to the Underwriter, to
the effect that:
(i) They are independent certified public accountants with respect to
the Company within the meaning of the Act, the Rules and Regulations, the
Exchange Act and the rules and regulations thereunder;
(ii) In their opinion, the audited financial statements and schedules
examined by them and included in the Registration Statement, or incorporated
therein by reference, and in the Prospectus comply as to form in all material
respects with the applicable accounting requirements of the Act, the Rules and
Regulations, the Exchange Act and the rules and regulations promulgated
thereunder;
(iii) On the basis of a reading of the latest available interim
unaudited financial statements of the Company, carrying out certain specified
procedures (which do not constitute an audit made in accordance with generally
accepted auditing standards) that would not necessarily reveal matters of
significance with respect to the comments set forth in this paragraph (iii), a
reading of the minute books of the stockholders, the board of directors and any
committees thereof of the Company and inquiries of certain officials of the
Company who have responsibility for financial and accounting matters, nothing
came to their attention that caused them to believe that at a specific date not
more than five business days prior to the date of such letter, there were any
changes in the shares of capital stock or long-term indebtedness of the Company,
in each case compared with amounts shown on the March 31, 1999 balance sheet
included in the Registration Statement and the Prospectus, or for the period
from April 1, 1999 to such specified date there were any decreases, as compared
with the corresponding period of the
-21-
preceding fiscal year, in net revenues, except in all instances for changes,
decreases or increases set forth in such letter or as set forth in or
contemplated in the Prospectus; and
(iv) They have carried out certain specified procedures, not
constituting an audit, with respect to certain amounts, percentages and
financial information that are derived from the general accounting records of
the Company and are included in its Annual Report on Form 10-KSB for the fiscal
year ended December 31, 1998 and have compared such amounts, percentages and
financial information with such records of the Company and with information
derived from such records and have found them to be in agreement, excluding any
questions of legal interpretation.
In the event that the letter referred to above sets forth any such changes,
decreases or increases, it shall be a further condition to the obligations of
the Underwriter that (A) such letters shall, if requested by the Underwriter, be
accompanied by a written explanation of the Company as to the significance
thereof and (B) such changes, decreases or increases do not, in the sole
judgment of the Underwriter, make it impractical or inadvisable to proceed with
the purchase and delivery of the Shares as contemplated by the Registration
Statement, as amended as of the date hereof.
At the Closing Date and, as to the Option Shares, if any, the Option
Closing Date, the Accountants shall have furnished to the Underwriter a letter,
dated the date of its delivery, which shall confirm, on the basis of a review in
accordance with the procedures set forth in the Original Letter, that nothing
has come to their attention during the period from the date of the Original
Letter referred to in the prior sentence to a date (specified in such letter)
not more than five days prior to the Closing Date or the Option Closing Date, as
the case may be, that would require any change in the Original Letter if it were
required to be dated and delivered at the Closing Date or the Option Closing
Date, as the case may be.
(j) At the Closing Date and, as to the Option Shares, if any, the Option
Closing Date, there shall be furnished to the Underwriter an accurate
certificate, dated the date of its delivery, signed on behalf of the Company by
each of the Chief Executive Officer and the Chief Financial Officer of the
Company, in form and substance satisfactory to the Underwriter, to the effect
that:
(i) Each signer of such certificate has carefully examined the
Registration Statement and the Prospectus and (A) as of the date of such
certificate, (x) neither the Registration Statement, nor any amendment or
supplement thereto, if any, contains any untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary in
order to make the statements therein not misleading and (y) neither the
Prospectus, nor any amendment or supplement thereto, if any, contains any untrue
statement of a material fact or omits to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading, and (B) since the
Effective Date, no event has occurred as a result of which it is necessary to
-22-
amend or supplement the Prospectus in order to make the statements therein not
untrue or misleading in any material respect;
(ii) Each of the representations and warranties of the Company
contained in the Transaction Documents were, when originally made, and are, at
the time such certificate is delivered, true and correct in all material
respects; each of the covenants required herein to be performed by the Company
on or prior to the date of such certificate has been duly, timely and fully
performed in all material respects and each condition herein required to be
complied with by the Company on or prior to the delivery of such certificate has
been duly, timely and fully complied with in all material respects.
(iii) The Registration Statement has become effective and no stop
order suspending the effectiveness of the Registration Statement or any
post-effective amendment thereto and no order directed at any document
incorporated by reference in the Registration Statement or any amendment thereto
or the Prospectus has been issued, and no proceedings for that purpose have been
instituted or, to the Company's knowledge, are threatened or contemplated by the
Commission.
(k) The Shares shall have been qualified for sale in such states as the
Underwriter may reasonably designate and each such qualification shall be in
full force and effect and not subject to any stop order or other proceeding on
the Closing Date and the Option Closing Date, if any.
(l) The Underwriter shall have received at or prior to the Closing Date
from Piper & Marbury L.L.P. a memorandum or summary, in form and substance
satisfactory to the Underwriter, with respect to the qualification for offering
and sale by the Underwriter of the Shares under the state securities or Blue Sky
laws of such jurisdictions as the Underwriter may reasonably have designated to
the Company.
(m) The Company shall (i) have received approval to list its Common Stock
on the Nasdaq National Market, including the Firm Shares and Option Shares, or
(ii) have received written consent from the Underwriter agreeing to the delay of
such approval by the Nasdaq National Market or (iii) received written consent
from the Underwriter that such approval is not required and (iv) not have
received any notice of delisting of any shares of Common Stock.
(n) The Lockup Agreements and the Warrant Agreement shall be in full force
and effect, and the Company shall have duly issued, sold and delivered the
Warrants to the Underwriter or its permitted designees.
(o) The Company shall have furnished to the Underwriter such certificates,
letters and other documents, in addition to those specifically mentioned herein,
as the Underwriter may have reasonably requested as to the accuracy and
completeness at the Closing Date and the Option Closing Date, if any, of any
statement in the Registration Statement or the Prospectus, as to the accuracy at
the Closing Date and the Option Closing Date, if any, of the
-23-
representations and warranties of the Company, as to the performance by the
Company of its obligations under the Transaction Documents or as to the
fulfillment of the conditions concurrent and precedent to the obligations
hereunder of the Underwriter.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are reasonably satisfactory
in form and substance to you. The Company will furnish you with such conformed
copies of such opinions, certificates, letters and other documents as you shall
reasonably request.
If any of the conditions hereinabove provided for in this Section 7 shall
not have been fulfilled when and as required by this Agreement to be fulfilled,
the obligations of the Underwriter hereunder may be terminated by the
Underwriter by notifying the Company of such termination in writing at or prior
to the Closing Date or the Option Closing Date, as the case may be.
8. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless the Underwriter, the
directors, officers, employees and agents of the Underwriter and each person, if
any, who controls the Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages or liabilities, joint or several (and actions in respect thereof), to
which they, or any of them, may become subject under the Act or other federal or
state law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon (i) any misrepresentation or breach of warranty made by the
Company in Section 3 of this Agreement, (ii) any untrue statement or alleged
untrue statement of any material fact contained in (A) any Preliminary
Prospectus, the Registration Statement or the Prospectus or any amendment or
supplement to the Registration Statement or the Prospectus or (B) any
application or other document, or any amendment or supplement thereto, executed
by the Company or based upon written information furnished by or on behalf of
the Company filed in any jurisdiction in order to qualify the Shares under the
securities or Blue Sky laws thereof or filed with the Commission, the NASD or
any securities association or securities exchange (each, an "Application"), or
(iii) the omission or alleged omission to state in any Preliminary Prospectus,
the Registration Statement or the Prospectus or any amendment or supplement to
the Registration Statement or the Prospectus or any Application a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse, as incurred, the Underwriter and each such other
person for any legal or other expenses reasonably incurred by the Underwriter or
such other person in connection with investigating, defending or appearing as a
third-party witness in connection with any such loss, claim, damage, liability
or action; provided, however, that the Company will not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
an untrue statement or omission or alleged untrue statement or omission in any
of such documents made or omitted to be made in reliance upon and in conformity
with information furnished by the Underwriter in writing to the Company by the
Underwriter expressly for inclusion therein; provided, further, that such
indemnity with respect
-24-
to any Preliminary Prospectus shall not inure to the benefit of the Underwriter
(or any such other person) from whom the person asserting any such loss, claim,
damage, liability or action purchased Shares which are the subject thereof to
the extent that any such loss, claim, damage or liability (i) results from the
fact that the Underwriter failed to send or give a copy of the Prospectus (as
amended or supplemented) to such person at or prior to the confirmation of the
sale of such Shares to such person in any case where such delivery is required
by the Act and (ii) arises out of or is based upon an untrue statement or
omission of a material fact contained in such Preliminary Prospectus that was
corrected in the Prospectus (or any amendment or supplement thereto), unless
such failure to deliver the Prospectus (as amended or supplemented) was the
result of noncompliance by the Company with Section 5(f) hereof. This indemnity
agreement will be in addition to any liability that the Company might otherwise
have. The Company will not, without the prior written consent of the
Underwriter, settle or compromise or consent to the entry of any judgment in any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification may be sought hereunder (whether or not the Underwriter or any
person who controls the Underwriter within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act is a party to each claim, action, suit or
proceeding), unless such settlement, compromise or consent includes an
unconditional release of the Underwriter and each such other person from all
liability arising out of such claim, action, suit or proceeding.
(b) The Underwriter will indemnify and hold harmless the Company, the
directors, officers, employees and agents of the Company and each person, if
any, who controls the Company within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, against any and all losses, claims, damages or
liabilities, joint or several (and actions in respect thereof), to which they,
or any of them, may become subject under the Act or other Federal or state law
or regulation, at common law or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon (i) any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus or any amendment or supplement to the Registration Statement or the
Prospectus or any Application, or (ii) the omission or the alleged omission to
state in the Registration Statement, any Preliminary Prospectus or the
Prospectus or any amendment or supplement to the Registration Statement or the
Prospectus, or any Application, 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 or omitted to be made in
reliance upon and in conformity with written information furnished to the
Company by the Underwriter expressly for use therein; and, subject to the
limitation set forth immediately preceding this clause, will reimburse, as
incurred, the Company and each such other person for any legal or other expenses
reasonably incurred by the Company and each such other person in connection with
investigating, defending or appearing as a third-party witness in connection
with any such loss, claim, damage, liability or any action in respect thereof.
The Company acknowledges that, for all purposes under this Agreement, the
statements set forth under the heading "Underwriting" and the information set
forth in the last paragraph on the front cover page (insofar as such information
relates to the Underwriter) and the last two paragraphs on the
-25-
inside front cover of any Preliminary Prospectus and the Prospectus constitute
the only information furnished in writing to the Company by the Underwriter
expressly for inclusion in the Registration Statement, any Preliminary
Prospectus or the Prospectus. This indemnity agreement will be in addition to
any liability that the Underwriter might otherwise have. The Underwriter will
not, without the prior written consent of the Company, settle or compromise or
consent to the entry of any judgment in any pending or threatened claim, action,
suit or proceeding in respect of which indemnification is sought hereunder
(whether or not the Company or any person who controls the Company within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act is a party to
each claim, action, suit or proceeding), unless such settlement, compromise or
consent includes an unconditional release of the Company and each such other
person from all liability arising out of such claim, action, suit or proceeding.
(c) Promptly after receipt by an indemnified party under this Section 8 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against an indemnifying party or parties
under this Section 8, notify such indemnifying party or parties of the
commencement thereof; but the omission so to notify the indemnifying party or
parties will not relieve it or them from any liability which it or they may have
to any indemnified party under the foregoing provisions of this Section 8 or
otherwise unless, and only to the extent that, such omission results in the
forfeiture of substantive rights or defenses by the indemnifying party. If any
such action is brought against an indemnified party, the indemnifying party or
parties against which a claim is made will be entitled to participate therein
and, to the extent that it or they may wish, to assume the defense thereof with
counsel reasonably satisfactory to such indemnified party; provided, however,
that if the defendants in any such action include both the indemnified party and
the indemnifying party or parties and the indemnified party shall have
reasonably concluded that there may be one or more legal defenses available to
it and/or other indemnified parties which are different from or additional to
those available to the indemnifying party or parties, the indemnifying party or
parties shall not have the right to direct the defense of such action on behalf
of such indemnified party or parties and such indemnified party or parties shall
have the right to select separate counsel to defend such action on behalf of
such indemnified party or parties. After notice from the indemnifying party or
parties to such indemnified party of its or their election so to assume the
defense thereof and approval by such indemnified party of counsel appointed to
defend such action, the indemnifying party or parties will not be liable to such
indemnified party under this Section 8 for any legal or other expenses other
than reasonable costs of investigation subsequently incurred by such indemnified
party in connection with the defense thereof, unless (i) the indemnified party
shall have employed separate counsel in accordance with the proviso to the next
preceding sentence (it being understood, however, that in connection with such
action the indemnifying party or parties shall not be liable for the expenses of
more than one separate counsel (in addition to local counsel) in any one action
or separate but substantially similar actions in the same jurisdiction arising
out of the same general allegations or circumstances, designated by the
Underwriter in the case of paragraph (a) of this Section 8, representing the
indemnified parties under such paragraph (a) who are parties to such action or
actions), or (ii) the indemnifying party has authorized in writing the
employment of counsel for the indemnified party at the expense of the
indemnifying
-26-
party or parties. After such notice from the indemnifying party or parties to
such indemnified party, the indemnifying party or parties will not be liable for
the costs and expenses of any settlement of such action effected by such
indemnified party without the consent of the indemnifying party or parties.
(d) If the indemnification provided for in the foregoing paragraphs of this
Section 8 is unavailable or insufficient to hold harmless an indemnified party
under paragraph (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) (i) in such proportion as is appropriate to reflect
the relative benefits received by the indemnifying party or parties, on the one
hand, and the indemnified party, on the other, from the offering of the Shares
or (ii) if, but only if, the allocation provided by the foregoing clause (i) is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the indemnifying party or parties on the one hand, and the
indemnified party, on the other, in connection with the statements or omissions
or alleged statements or omissions that resulted in such losses, claims, damages
or liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company, on the
one hand, and the Underwriter, on the other, shall be deemed to be in the same
proportion as the total proceeds from the offering of the Shares (before
deducting expenses) received by the Company bear to the total underwriting
discounts and commissions received by the Underwriter, in each case as set forth
in the table on the cover page of the Prospectus. Relative fault shall be
determined by reference to 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 or the Underwriter, the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Underwriter agree that
it would not be just and equitable if contributions pursuant to this Section
8(d) were to be determined by pro rata allocation or by any other method of
allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities (or actions in respect
thereof) referred to above in this Section 8(d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 8(d), the aggregate amount that
the Underwriter shall be required to contribute for all claims in respect of
this Section 8 shall be limited to the amount of the underwriting discounts and
commissions applicable to the Shares purchased by the Underwriter.
Notwithstanding the provisions of this Section 8(d), the Company shall not be
required to contribute any amount in excess of the amount by which the total
proceeds received by it from the sale of the Shares under this Agreement, before
deducting expenses, exceeds the aggregate amount of any damages that the Company
has otherwise been required to pay in respect of the same or any substantially
similar claim. No person found guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) will be entitled to contribution from
any person who was not guilty of such
-27-
fraudulent misrepresentation. The Underwriter's obligations to contribute as
provided in this Section 8(d) are several in proportion to their respective
underwriting obligations and not joint. For purposes of this Section 8(d), each
person, if any, who controls the Underwriter within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act will have the same rights to
contribution as the Underwriter, and each director of the Company, each officer
of the Company who signed the Registration Statement and each person, if any,
who controls the Company within the meaning of Section 15 of the Act or Section
20 of the Exchange Act, will have the same rights to contribution as the
Company, subject in each case to the provisions of this Section 8(d). Any party
entitled to contribution will, promptly after receipt of notice of commencement
of any action, suit or proceeding against such party in respect of which a claim
for contribution may be made under this Section 8(d), notify any such party or
parties from whom contribution may be sought, but the omission so to notify will
not relieve the party or parties from whom contribution may be sought from any
other obligation(s) it or they may have hereunder or otherwise than under this
Section 8(d), or to the extent that such party or parties were not adversely
affected by such omission. The contribution agreement set forth above shall be
in addition to any liabilities which any indemnifying party may otherwise have.
No party will be liable for contribution with respect to any action or claim
settled without its written consent (which consent will not be unreasonably
withheld).
9. Termination. The obligations of the Underwriter under this Agreement may
be terminated at any time prior to the Closing Date (or, with respect to the
Option Shares, if any, on or prior to the Option Closing Date), by notice to the
Company from the Underwriter, without liability on the part of the Underwriter
to the Company, if, prior to delivery and payment for the Firm Shares (or the
Option Shares, if any, as the case may be), (i) the Company shall have failed,
refused or been unable, at or prior to such Closing Date, to perform all
obligations on its part to be performed under the Transaction Documents, (ii)
any of the representations or warranties of the Company are not accurate in any
respect, (iii) since the respective dates as of which information is given in
the Registration Statement and the Prospectus, there shall have occurred any
material adverse change in the general affairs, business, properties,
management, condition (financial or otherwise), net worth or results of
operation, whether or not arising in the ordinary course of business, (iv)
trading in the shares of Common Stock or securities generally shall have been
suspended by the Commission or by The Nasdaq Stock Market, (v) minimum or
maximum prices shall have been established for the shares of Common Stock or
securities generally on either The Nasdaq Stock Market or the New York Stock
Exchange, or additional material governmental restrictions, not in force on the
date of this Agreement, shall have been imposed upon trading in securities
generally by any such market or exchange or by order of the Commission or any
court or other governmental authority, (vi) a general banking moratorium shall
have been declared by the United States or New York State authorities, (vii)
there shall have been enacted, published, decreed or otherwise promulgated any
statute, regulation, rule or order of any court or other Governmental Body which
in the opinion of the Underwriter materially and adversely affects or may
materially and adversely affect the business or operations of the Company or
(viii) any material adverse change in the financial or securities markets in the
United States or any outbreak or material escalation of hostilities or
declaration by the United
-28-
States of a national emergency or war or other calamity or crisis shall have
occurred, the effect of any of which is such as to make it, in the sole judgment
of the Underwriter, impracticable or inadvisable to market the Shares on the
terms and in the manner contemplated by the Prospectus. This Agreement may also
be terminated as provided in Section 7 of this Agreement. Any termination
pursuant to this Section 9 shall be without liability of any party to any other
party except as provided in Sections 6 and 8 hereof.
10. [Intentionally Omitted]
11. Survival. The respective representations, warranties, agreements,
covenants, indemnities and other statements of the Company and the Underwriter
pursuant to this Agreement shall remain in full force and effect, regardless of
(i) any investigation made by or on behalf of the Company, any of its officers
or directors, the Underwriter or any controlling person referred to in Section 8
hereof and (ii) delivery of and payment for the Shares. The respective
agreements, covenants, indemnities and other statements set forth in Sections 6
and 8 hereof shall remain in full force and effect, regardless of any
termination or cancellation of this Agreement.
12. Notices. Notice given pursuant to any of the provisions of this
Agreement shall be in writing and, unless otherwise specified, shall be mailed
or delivered (a) if to the Company, at the office of the Company, 0 Xxxxxxx
Xxxx, Xxx Xxxxx, Xxxxxxxxxxx 00000, Attention: Chief Executive Officer,
Telephone: (000) 000-0000 and Facsimile: (000) 000-0000, with a copy to
Fulbright & Xxxxxxxx L.L.P., 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxx Xxxxxx, Esq. and Xxxxxxxx X. Xxxxxxx, Esq., Telephone: (212)
000-0000 and Facsimile: (000) 000-0000 or (b) if to the Underwriter, at the
offices of Xxxxx Xxxxxx & Co., Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000-0000 Attention: Xx. X. Xxxxx Xxxxxx and Xx. Xxxxxxxx Bubrosky, Telephone:
(000) 000-0000 and Facsimile: (000) 000-0000, with a copy to Piper & Marbury
L.L.P., 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, Attention:
Xxxxxxx Xxxxxxxxxx, Esq., Telephone: (000) 000-0000 and Facsimile: (212)
835-6001. Any such notice shall be effective only upon receipt. Any notice under
Section 8 or 9 hereof may be made by telephone or facsimile but if so made shall
be subsequently confirmed in writing.
13. Successors. This Agreement shall inure to the benefit of and shall be
binding upon the Underwriter, the Company and their respective successors and
legal representatives, and nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any other person any legal or equitable
right, remedy or claim under or in respect of this Agreement, or any provisions
herein contained, this Agreement and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of such persons and
for the benefit of no other person except that (i) the indemnities of the
Company contained in Section 8 of this Agreement shall also be for the benefit
of any person or persons who control the Underwriter within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act and (ii) the indemnities
of the Underwriter contained in Section 8 of this Agreement shall also be for
the benefit of the directors of the Company, the officers of the Company who
have signed the Registration Statement and any person or persons who control the
Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act. No purchaser of Shares from the
-29-
Underwriter shall be deemed a successor because of such purchase. This Agreement
shall not be assignable by any party hereto without the prior written consent of
the other parties.
14. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF THIS AGREEMENT, AND
THE TERMS AND CONDITIONS SET FORTH HEREIN, SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ANY
PROVISIONS RELATING TO CONFLICTS OF LAWS.
15. Submission to Jurisdiction. The Company hereby submits to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of the Supreme Court of the State of New York sitting
in New York County (including its Appellate Division), and of any other
appellate court in the State of New York, for the purposes of all legal
proceedings arising out of or relating to this Agreement or the transactions
contemplated hereby. The Company irrevocably waives, to the fullest extent
permitted by applicable law, any objection that it may now or hereafter have to
the laying of venue of any such proceeding brought in such a court and any claim
that any such proceeding brought in such a court has been brought in an
inconvenient forum.
16. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
-30-
Please confirm that the foregoing correctly sets forth the agreement among
the Company and the Underwriter.
Very truly yours,
VION PHARMACEUTICALS, INC.
By: _______________________________
Xxxx Xxxxxxx
President and Chief Executive Officer
Confirmed as of the date first above mentioned:
XXXXX XXXXXX & CO., INC.
By:_________________________________
Xxxxxxxx Xxxxxxxx
Executive Vice President and Senior Managing Director
Acting on its behalf
-31-
