EXHIBIT 1
3,100,000 Shares of Common Stock
eMed Technologies Corporation
UNDERWRITING AGREEMENT
----------------------
October [ ], 1999
BEAR, XXXXXXX & CO. INC.
XXXXXXXXX, LUFKIN & XXXXXXXX SECURITIES CORPORATION
WIT CAPITAL CORPORATION,
as representatives of the several Underwriters named in Schedule I
attached hereto
c/o Bear, Xxxxxxx & Co. Inc. 000 Xxxx Xxxxxx Xxx Xxxx, XX 00000
Ladies and Gentlemen:
eMed Technologies Corporation, a corporation organized and existing
under the laws of Delaware (the "Company"), proposes, subject to the terms and
conditions stated herein, that the Company issue and sell to the several
underwriters named above (the "Underwriters"), as indicated in Schedule I
hereto, an aggregate of 3,100,000 shares (the "Firm Shares") of its Common
Stock, par value $.01 per share (the "Common Stock"), and, for the sole purpose
of covering over-allotments in connection with the sale of the Firm Shares, at
the option of the Underwriters, up to an additional 465,000 shares (the
"Additional Shares") of Common Stock. The Firm Shares and any Additional Shares
purchased by the Underwriters are referred to herein as the "Shares". The
Shares are more fully described in the Registration Statement referred to below.
1. Representations and Warranties of the Company. The Company
---------------------------------------------
represents and warrants to, and agrees with, the Underwriters that:
(a) The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement, and may have filed an amendment or
amendments thereto, on Form S-1 (No. 333-85481), for the registration
of the Shares under the Securities Act of 1933, as amended (the "Act"). Such
registration statement, including the prospectus, financial statements and
schedules, exhibits and all other documents filed as a part thereof, as amended
at the time of effectiveness of the registration statement, including any
information deemed to be a part thereof as of the time of effectiveness pursuant
to paragraph (b) of Rule 430A or Rule 434 of the Rules and Regulations of the
Commission under the Act (the "Regulations"), is herein called the "Registration
Statement". Any registration statement filed pursuant to Rule 462(b) of the
Regulations is herein called the "462(b) Registration Statement", and after such
filing the term "Registration State ment" shall include the Rule 462(b)
Registration Statement. The prospectus, in the form first filed with the
Commission pursuant to Rule 424(b) of the Regulations or filed as part of the
Registration Statement at the time of effectiveness if no Rule 424(b) or Rule
434 filing is required, is herein called the "Prospectus". The term "preliminary
prospectus" as used herein means a preliminary prospectus as described in Rule
430 of the Regulations. Neither the Commission nor the Blue Sky or securities
authority of any jurisdiction has issued a stop order suspending the
effectiveness of the Registration Statement, preventing or suspending the use of
any preliminary prospectus, the Prospectus, the Registration Statement or any
amend ment or supplement thereto, refusing to permit the effectiveness of the
Registration Statement or suspending the registration or qualification of the
Shares, nor, to the Company's knowledge, has any of such authorities instituted
or threatened to institute any proceedings with respect to a stop order.
(b) At the respective time of the effectiveness of the Registra tion
Statement or any 462(b) Registration Statement or the effectiveness of any post-
effective amendment to the Registration Statement, when the Prospectus is first
filed with the Commission pursuant to Rule 424(b) or Rule 434 of the
Regulations, when any supplement to or amendment of the Prospectus is filed with
the Commission and at the Closing Date and the Additional Closing Date, if any
(as hereinafter respec tively defined), the Registration Statement and the
Prospectus and any amendments thereof and supplements thereto (including any
prospectus wrapper) complied or will comply in all material respects with the
applicable provisions of the Act and the Regulations and does not or will not
contain an untrue statement of a material fact and does not or will not omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein (i) in the case of the Registration Statement, not
misleading and (ii) in the case of the Prospectus, in light of the circumstances
under which they were made, not misleading. When any related preliminary
prospectus was first filed with the Commission (whether filed as part of the
registration statement for the registration of the Shares or any amendment
thereto
2
or pursuant to Rule 424(a) of the Regulations) and when any amendment
thereof or supplement thereto was first filed with the Commission, such
preliminary prospectus and any amendments thereof and supplements thereto
complied in all material respects with the applicable provisions of the Act and
the Regulations and did not contain an untrue statement of a material fact and
did not omit to state any 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. No representation and warranty is
made in this subsection (b), however, with respect to any information contained
in or omitted from the Registration Statement or the Prospectus or any related
preliminary prospectus or any amendment thereof or supplement thereto in
reliance upon and in conformity with information furnished in writing to the
Company by or on behalf of any Underwriter through you as herein stated
expressly for use in connection with the preparation thereof. If Rule 434 is
used, the Company will comply with the requirements of Rule 434.
(c) PricewaterhouseCoopers LLP, who have certified the financial
statements and supporting schedules included in the Registration State ment,
are independent public accountants as required by the Act and the Regulations.
(d) Subsequent to the respective dates as of which informa tion is
given in the Registration Statement and the Prospectus, except as disclosed in
the Prospectus, there has been no material adverse change or any development
involving a prospective material adverse change in the business, prospects,
proper ties, operations, condition (financial or other) or results of
operations of the Com pany, including but not limited to relationships with
customers and suppliers of the Company, whether or not arising from transactions
in the ordinary course of business (a "Material Adverse Effect"), and since the
date of the latest balance sheet presented in the Registration Statement and the
Prospectus, the Company has not incurred nor assumed any liabilities or
obligations, direct or contingent, other than in the ordinary course, which are
material to the Company, except for liabilities or obligations which are
disclosed in the Registration Statement and the Prospectus.
(e) This Agreement and the transactions contemplated herein have been
duly and validly authorized by the Company, and this Agreement has been duly and
validly executed and delivered by the Company.
(f) The execution, delivery, and performance of this Agree ment by
the Company and the consummation by the Company of the transactions contemplated
hereby do not and will not (i) conflict with or result in a breach of any
3
of the terms and provisions of, or constitute a default (or an event which with
notice or lapse of time, or both, would constitute a default) or Repayment Event
(as hereinafter defined) under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company pursuant
to, any agreement, instrument, franchise, license or permit to which the Company
is a party or by which the Company or its properties or assets may be bound,
(ii) any judg ment, decree, order, statute, rule or regulation of any court or
any public, govern mental or regulatory agency or body having jurisdiction over
the Company or any of its properties or assets or (iii) violate or conflict with
any provision of the certificate of incorporation or by-laws of the Company,
except in the case of (i) and (ii) to the extent as would not have a Material
Adverse Effect. No consent, approval, authori zation, order, registration,
filing, qualification, license or permit of or with any court or any public,
governmental or regulatory agency or body having jurisdiction over the Company
or any of its properties or assets is required for the execution, delivery and
performance of this Agreement or the consummation of the transactions contem
plated hereby, including the issuance, sale and delivery of the Shares to be
issued, sold and delivered by the Company hereunder, except the registration
under the Act of the Shares and such consents, approvals, authorizations,
orders, registrations, filings, qualifications, licenses and permits as may be
required under state securities or Blue Sky laws in connection with the purchase
and distribution of the Shares by the Underwriters. As used herein, a "Repayment
Event" means any event or condi tion which gives the holder of any note,
debenture or other evidence of indebtedness (or any person acting on such
holder's behalf) the right to require the repurchase, redemption or repayment of
all or a portion of such indebtedness by the Company.
(g) All of the outstanding shares of capital stock of the Company are
duly and validly authorized and issued, fully paid and nonassessable, and none
of such shares was issued in violation of or is now subject to any preemp tive
or similar rights. The Shares have been duly authorized for issuance and sale
to the Underwriters pursuant to this Agreement and, when issued, delivered and
paid for in accordance with this Agreement, will be duly and validly issued and
outstand ing, fully paid and nonassessable, will not have been issued in
violation of or be subject to any preemptive or similar rights and no holder of
Shares will be subject to personal liability by reason of being such a holder.
The Company had, at [June 30, 1999] an authorized and outstanding capitalization
as set forth in the Registration Statement and the Prospectus. The authorized
capital stock of the Company, including the Firm Shares and the Additional
Shares, conforms, in all material respects, with the description thereof
contained in the Registration Statement and the Prospectus. Except as disclosed
in the Registration Statement and the Prospectus,
4
there are no outstanding options, warrants or other rights calling for the
issuance of, and no commitments, obligations, plans or arrangements to issue,
any shares of capital stock of the Company or any security convertible into or
exchangeable for capital stock of the Company. The outstanding stock options and
warrants relating to the Common Stock have been duly authorized and validly
issued and conform to the descriptions thereof contained in the Registration
Statement and the Prospectus.
(h) The Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Delaware. The
Company is duly 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 makes such qualification
necessary, except for those failures to be so qualified or in good standing
which will not in the aggregate have a Material Adverse Effect. The Company has
all requisite power and authority, and all necessary consents, approvals,
authorizations, orders, registrations, qualifications, licenses and permits
(collectively, "Governmental Licenses") of and from all public, regulatory or
governmental agencies and bodies, to own, lease and operate its properties and
conduct its business as now being conducted and as described in the Registration
Statement and the Prospectus, each such Governmental License is valid and in
full force and effect and no such Governmental License contains a materially
burdensome restriction not adequately disclosed in the Regis tration Statement
and the Prospectus and the Company has not received any notice of proceedings
relating to the revocation of any such Governmental Licenses.
(i) The Company has no subsidiaries and does not otherwise own or
control, directly or indirectly, any other corporation, association, or business
entity.
(j) The Company is not in violation of its charter or by-laws or in
default (or would be in default with notice or lapse of time, or both) in the
performance or observance of any material obligation, agreement, covenant or
condition contained in any material bond, debenture, note or other evidence of
indebtedness or in any material contract, indenture, mortgage, deed of trust,
loan or credit agreement, lease, joint venture or other agreement or instrument
to which the Company is a party or by which any of its properties may be bound,
which default or defaults would have in the aggregate a Material Adverse Effect,
or in violation of any law, order, rule, regulation, writ, injunction, judgment
or decree of any court or governmental agency or body, the violation of which
would have in the aggregate a Material Adverse Effect.
5
(k) Except as described in the Prospectus, there is no litiga tion
or governmental proceeding to which the Company is a party or to which any
property of the Company is subject or which is pending or, to the knowledge of
the Company, contemplated against the Company which might individually or in the
aggregate result in a Material Adverse Effect or which is required to be
disclosed in the Registration Statement and the Prospectus, and the to the
Company's knowledge, no such proceeding are threatened or contemplated.
(l) Neither the Company nor any of its directors, officers or
affiliates (as defined in the Regulations) has taken or will take, directly or
indirectly, any action designed to cause or result in, or which constitutes or
which might reasonably be expected to constitute, the stabilization or
manipulation of the price of the shares of Common Stock to facilitate the sale
or resale of the Shares.
(m) The financial statements, including the notes thereto, and
supporting schedules included in the Registration Statement and the Prospectus
present fairly, in all material respects, the financial position of the Company
as of the dates indicated and the results of its operations for the periods
specified; except as otherwise stated in the Registration Statement, said
financial statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis; and the supporting
schedules included in the Registration Statement present fairly the information
required to be stated therein; and the selected financial data and the summary
financial information included in the Registration Statement and the Prospectus
present fairly in all material respects, the information shown therein and have
been compiled on a basis consistent with that of the financial statements
included in the Registration Statement and the Prospectus.
(n) The Company has filed all federal, state, local and foreign tax
returns that have been required to be filed as of the date hereof and has paid
all taxes shown as due thereon and all assessments received by them or any of
them to the extent that such taxes have become due and are not being contested
in good faith. Except as disclosed in the Registration Statement and the
Prospectus, there is no tax deficiency that has been or might reasonably be
expected to be asserted or threatened against the Company.
(o) Except as described in the Prospectus or as would not have a
Material Adverse Effect the Company owns or possesses, or reasonably believes it
can acquire on reasonable terms, valid and enforceable licenses or other
6
rights to use all inventions, patents, patent applications, trademarks, service
marks, trade names, trade dress copyrights, technology, know-how (including
trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures) and other intellectual property
rights necessary to conduct the business now conducted or presently contemplated
to be conducted by the Company, as described in the Registration Statement and
the Prospectus ("Intellectual Prop erty"). The Company has taken, or caused to
be taken, all appropriate steps to protect, maintain and safeguard the
Intellectual Property for which improper or unauthorized disclosure would impair
its value or validity, and has executed appro priate nondisclosure and
confidentiality agreements and made appropriate filings and registrations in
connection with the foregoing, except where in-action would not result in a
Material Adverse Effect. Other than as described in the Registration Statement
and the Prospectus or as would not have a Material Adverse Effect: (i) there are
no third parties who have any rights in the Intellectual Property that could
preclude the Company from conducting its business as currently conducted or as
presently contemplated to be conducted as described in the Registration
Statement and the Prospectus; (ii) there are no pending or, to the Company's
knowledge, threatened actions, suits, proceedings, investigations or claims by
others challenging the rights in the Intellectual Property of the Company or (if
the Intellectual Property is licensed) the licensor thereof in any Intellectual
Property owned or licensed to the Company; (iii) the Company has not and (if the
Intellectual Property is licensed) to the Company's knowledge, the licensor
thereof has not infringed, or received any notice of infringement of or conflict
with, any rights of others with respect to the Intellectual Property; (iv) there
is, to the knowledge of the Company, no dispute between the Company or any
licensor with respect to any Intellectual Property; and (v) the statements in
the Prospectus under the caption "Business- Production," to the extent they
purport to summarize the provisions of the Company's licenses with AWARE, Inc.,
are accurate in all material respects.
(p) The Company has no reason to believe that it is not in compliance
with applicable Food and Drug Administration ("FDA") regulations governing the
design, manufacture and labeling of the Company's medical products. The Company
has registered with all state entities which require the registration of medical
devices, except where the failure to register would not result in a Material
Adverse Effect.
(q) No relationship, direct or indirect, exists between or among the
Company, on the one hand, and the directors, officers, stockholders, customers
or suppliers of the Company, on the other hand, that is required by the Act
7
to be described in the Registration Statement and the Prospectus that is not so
described.
(r) The Shares have been approved for quotation on the Nasdaq
National Market, subject only to official notice of issuance.
(s) Except as described in the Prospectus, no holder of securities of
the Company has any rights to the registration of securities of the Company
because of the filing of the Registration Statement or otherwise in connec tion
with the sale of the Shares contemplated hereby.
(t) The Company is not, and upon consummation of the transactions
contemplated hereby will not be, subject to registration as an "invest ment
company" under the Investment Company Act of 1940.
(u) There are no existing or, to the knowledge of the Com pany,
threatened labor disputes with any employees of the Company that would have a
Material Adverse Effect.
(v) The Company (i) is in compliance with any and all applicable
foreign, federal, state and local laws and regulations relating to the
protection of human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants ("Environmental Laws"), except
where such noncompliance would not have a Material Adverse Effect, (ii) has
received all permits, licenses or other approvals required of it under
applicable Environmental Laws to conduct its respective business except where
such failure to obtain permits, licenses or other approval would not have a
Material Adverse Effect, and (iii) is in compliance with all terms and
conditions of any such permit, license or approval, except where such
noncompliance, failure to comply with the terms and conditions of such permits,
licenses or approvals will not have a Material Adverse Effect.
(w) Each employee benefit plan, within the meaning of Section 3(3) of
the Employee Retirement Income Securities Act of 1974, as amended ("ERISA"),
that is maintained, administered or contributed to by the Company for employees
or former employees of the Company has been maintained in compliance with its
respective terms and the requirements of any applicable statutes, order, rules
and regulations, including but not limited to ERISA and the Internal Revenue
Code of 1986, as amended (the "Code"). No prohibited transaction, within the
meaning of
8
Section 406 of ERISA or Section 4975 of the Code, has occurred with respect to
any such plan, excluding transactions effected pursuant to a statutory or
administrative exemption. For each such plan that is subject to the funding
rules of Section 412 of the Code or Section 302 of ERISA, no "accumulated
funding deficiency", as defined in Section 412 of the Code, has been incurred,
whether or not waived, and the fair market value of the assets of each such plan
(excluding for these purposes accrued but unpaid contributions) exceeded the
present value of all benefits accrued under such plan determined using
reasonable actuarial assumptions.
(x) The Company maintains insurance of the types and in the amounts
generally deemed adequate for its business, including, without limitation,
insurance coverage for real and personal property owned or leased by it against
theft, damage, destruction, acts of vandalism, product liability and all other
material risks customarily insured against, all of which insurance is in full
force and effect. The Company has no reason to believe that it will not be able
to renew existing insurance coverage as and when such coverage expires or to
obtain similar coverage from similar insurers as may be necessary to continue
its respective business.
(y) The Company believes that its systems are Year 2000 compliant,
except to the extent that non-compliance would not have a Material Adverse
Effect, and that, with respect to third party vendors, suppliers and custom
ers, the Company has taken, or caused to be taken, all appropriate steps to
protect against a Material Adverse Effect as a result of Year 2000 non-
compliance by such parties, except where in-action would not have a Material
Adverse Effect.
(z) There are no contracts or documents which are required to be
described in the Registration Statement or the Prospectus or to be filed as
exhibits thereto which have not been so described and filed as required.
(aa) None of the Company's stockholders have rights to require the
Company to include the securities of the Company they hold in the Offering or to
require the Company to register such securities under the Securities Act for the
180-day period beginning on the date hereof (unless the Company is otherwise
registering capital stock of the Company), or if any stockholders have such
rights, they have validly and irrevocably waived such rights, and the Company
agrees that it will not waive the undertakings of the stockholders under those
waivers.
9
2. Purchase, Sale and Delivery of the Shares.
------------------------------------------
(a) On the basis of the representations, warranties, covenants and
agreements herein contained, but subject to the terms and conditions herein set
forth, the Company agrees to sell to the Underwriters and the Underwriters,
severally and not jointly, agree to purchase from the Company, at a purchase
price per share of $[ ], the number of Firm Shares set forth opposite the
respective names of the Underwriters in Schedule I hereto plus any additional
number of Shares which such Underwriter may become obligated to purchase
pursuant to the provisions of Section 9 hereof.
(b) Payment of the purchase price for, and delivery of certificates
for, the Shares shall be made at the offices of Ropes & Xxxx ("Company's
Counsel"), Xxx Xxxxxxxxxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000-0000 or at such
other place as shall be agreed upon by you and the Company, at 9:00 A.M. on the
third or fourth Business Day (as permitted under Rule 15c6-1 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) (unless
postponed in accordance with the provisions of Section 9 hereof) following the
date of the effectiveness of the Registration Statement (or, if the Company has
elected to rely upon Rule 430A of the Regulations, the third or fourth Business
Day (as permitted under Rule 15c6-1 under the Exchange Act) after the
determination of the initial public offering price of the Shares), or such other
time not later than ten Business Days after such date as shall be agreed upon by
you and the Company (such time and date of payment and delivery being herein
called the "Closing Date"). As used herein, the term "Business Day" means any
day other than a day on which banks are permitted or required to be closed in
New York City. Payment shall be made to the Company by wire transfer in same
day funds, against delivery to you at the offices of Underwriters' Counsel, or
such other location as may be mutually acceptable, for the respective accounts
of the Underwriters of certificates for the Shares to be purchased by them.
Delivery of the certificates for the Shares shall be made through the facilities
of The Depository Trust Company ("DTC") unless the Underwriters shall otherwise
instruct.
(c) In addition, the Company hereby grants to the Underwrit ers the
option to purchase up to 465,000 Additional Shares at the same purchase price
per share to be paid by the Underwriters to the Company for the Firm Shares as
set forth in this Section 2, for the sole purpose of covering over-allotments in
the sale of Firm Shares by the Underwriters. This option may be exercised at
any time, or from time to time, in whole or in part, on or before the thirtieth
day following the date of the Prospectus, by written notice by you to the
Company. Such notice shall set forth the aggregate number of Additional Shares
as to which the option is being
10
exercised and the date and time, as reasonably determined by you, when the
Additional Shares are to be delivered (such date and time being herein sometimes
referred to as the "Additional Closing Date"); provided, however, that the
Additional Closing Date shall not be earlier than the Closing Date or earlier
than the second full Busi ness Day after the date on which the option shall have
been exercised nor later than the eighth full Business Day after the date on
which the option shall have been exercised (unless such time and date are
postponed in accordance with the provisions of Section 9 hereof). Delivery of
the certificates for the Additional Shares shall be made through the facilities
of the DTC unless the Underwriters shall otherwise instruct.
The number of Additional Shares to be sold to each Underwriter shall
be the number which bears the same ratio to the aggregate number of Additional
Shares being purchased as the number of Firm Shares set forth opposite the name
of such Underwriter in Schedule I hereto (or such number increased as set forth
in Section 9 hereof) bears to 310,000,000, subject, however, to such adjustments
to eliminate any fractional shares as you in your sole discretion shall make.
Payment of the purchase price for the Additional Shares shall be made
to the Company by wire transfer in same day funds at the offices of Underwrit
ers' Counsel, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or such other location
as may be mutually acceptable, upon delivery of the certificates for the
Additional Shares to you for the respective accounts of the Underwriters.
3. Offering.
--------
Upon your authorization of the release of the Firm Shares, the
Underwriters propose to offer the Shares for sale to the public upon the terms
set forth in the Prospectus.
4. Covenants of the Company. The Company covenants and agrees with
------------------------
the Underwriters that:
(a) If the Registration Statement has not yet been declared
effective, the Company will use its best efforts to cause the Registration
Statement and any amendments thereto to become effective as promptly as
possible, and if Rule 430A is used or the filing of the Prospectus is otherwise
required under Rule 424(b) or Rule 434, the Company will file the Prospectus
(properly completed if Rule 430A has been used) pursuant to Rule 424(b) or Rule
434 within the prescribed time period
11
and will provide evidence satisfactory to you of such timely filing. If the
Company elects to rely on Rule 434, the Company will prepare and file a term
sheet that complies with the requirements of Rule 434.
The Company will notify you immediately (and, if requested by you,
will confirm such notice in writing) (i) when the Registration Statement and any
amendments thereto become effective, (ii) of any request by the Commission for
any amendment of or supplement to the Registration Statement or the Prospectus
or for any additional information, (iii) of the mailing or the delivery to the
Commission for filing of any amendment of or supplement to the Registration
Statement or the Prospectus, (iv) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or any post-
effective amendment thereto or of the initiation, or the threatening, of any
proceedings therefor, (v) of the receipt of any comments from the Commission,
and (vi) of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Shares for sale in any jurisdiction or
the initiation or threatening of any proceeding for that purpose. If the
Commission shall propose or enter a stop order at any time, the Company will
make every reasonable effort to prevent the issuance of any such stop order and,
if issued, to obtain the lifting of such order as soon as possible. The Company
will not file any amendment to the Registration Statement, make any filing under
Rule 462(b) of the Regulations, or any amendment of or supplement to the
Prospectus (including the prospectus required to be filed pursuant to Rule
424(b)or Rule 434 of the Regulations) that differs from the prospectus on file
at the time of the effectiveness of the Registration Statement before or after
the effective date of the Registration Statement to which you shall reasonably
object in writing after being timely furnished in advance a copy thereof.
(b) If at any time when a prospectus relating to the Shares is
required to be delivered under the Act any event shall have occurred as a result
of which the Prospectus as then amended or supplemented would, in the judgment
of the Underwriters or the Company, include an untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, or if it shall be necessary at any
time to amend or supplement the Prospectus or Registration Statement to comply
with the Act or the Regulations, the Company will notify you promptly and
prepare and file with the Commission an appropriate amendment or supplement (in
form and substance reasonably satisfactory to you) which will correct such
statement or omission and will use its reasonable
12
best efforts to have any amendment to the Registration Statement declared
effective as soon as possible.
(c) The Company will promptly deliver to you one signed copy of the
Registration Statement, including exhibits and all amendments thereto, and the
Company will promptly deliver to each of the Underwriters such number of copies
of any preliminary prospectus, the Prospectus, the Registration Statement, and
all amendments of and supplements to such documents, if any, as you may reason
ably request.
(d) The Company will endeavor in good faith, in cooperation with you,
at or prior to the time of effectiveness of the Registration Statement, to
qualify the Shares for offering and sale under the securities laws relating to
the offering or sale of the Shares of such jurisdictions as you may designate
and to maintain such qualification in effect for so long as required for the
distribution thereof; except that in no event shall the Company be obligated in
connection therewith to qualify as a foreign corporation or to execute a general
consent to service of process, to qualify as a securities dealer or to subject
itself to taxation in respect of doing business in any jurisdiction in which it
is not otherwise so subject.
(e) The Company will make generally available (within the meaning of
Section 11(a) of the Act) to its security holders and to you as soon as
practicable, but not later than 45 days after the end of its fiscal quarter in
which the first anniversary date of the effective date of the Registration
Statement occurs, an earning statement (in form complying with the provisions of
Rule 158 of the Regulations) covering a period of at least twelve consecutive
months beginning after the effective date of the Registration Statement.
(f) During the period of 180 days from the date of the Prospectus,
(A) the Company will not directly or indirectly, without the prior written
consent of Bear Xxxxxxx, issue, sell, offer or agree to sell, grant any option
for the sale of, pledge, or otherwise dispose of or encumber or otherwise create
or maintain a "put equivalent position" (within the meaning of Rule 16a-1(h) of
the Rules and Regulations of the Commission under the Exchange Act) in, any
Common Stock (or any securities convertible into, exercisable for or
exchangeable for Common Stock), other than (1) the Company's sale of Shares
hereunder, (2) the Company's issuance of Common Stock upon the exercise of
presently outstanding stock options or warrants or the conversion of securities
outstanding on the date hereof, (3) the grant of options under the stock option
plan described in the Prospectus, so long as they
13
are either (i) not exercisable for 180 days after the date of the Prospectus or
(ii) the holder thereof provides an undertaking substantially consistent with
that contained in Schedule II hereto or (4) the issuance of Common Stock in
acquisitions or invest ment transactions approved the holders of such Common
Stock provide undertakings substantially consistent with that contained in
Schedule II and (B) and the Company will obtain an undertaking, in the form
previously provided to the Company by Bear Xxxxxxx, a copy of which is attached
hereto as Schedule II, of each of the Company's officers, directors and
shareholders listed on Schedule III hereto. The Company agrees not to waive any
undertaking obtained pursuant to this paragraph.
(g) During a period of three years from the effective date of the
Registration Statement, the Company will furnish to you copies of (i) all
reports to its stockholders; and (ii) all reports, financial statements and
proxy or information statements filed publicly by the Company with the
Commission or any national securities exchange.
(h) The Company will apply the proceeds from the sale of the Shares
as set forth under "Use of Proceeds" in the Prospectus and report such use of
proceeds as may be required pursuant to Rule 463 of the Regulations.
(i) The Company will use its reasonable best efforts to cause the
Shares to be quoted on the Nasdaq National Market and to maintain such quotation
for at least three years from the date hereof.
5. Payment of Expenses. Whether or not the transactions contem
-------------------
plated in this Agreement are consummated or this Agreement is terminated, the
Company hereby agrees to pay all costs and expenses incident to the performance
of the obligations of the Company hereunder, including those in connection with
(i) preparing, printing, duplicating, filing and distributing the Registration
Statement, as originally filed and all amendments thereof (including all
exhibits thereto), any preliminary prospectus, the Prospectus and any amendments
or supplements thereto (including, without limitation, fees and expenses of the
Company's accountants and counsel), printing, duplicating, filing and
distributing the underwriting documents (including this Agreement) and all other
documents related to the public offering of the Shares (including those supplied
to the Underwriters in quantities as hereinabove stated), (ii) the issuance,
transfer and delivery of the Shares to the Underwriters, including any transfer
or other taxes payable thereon, (iii) the qualification of the Shares under
state or foreign securities or Blue Sky laws, including the costs of printing
and mailing a preliminary and final "Blue Sky Survey" and the fees
14
of counsel for the Underwriters and such counsel's disbursements in relation
thereto, (iv) quotation of the Shares on the Nasdaq National Market, (v) filing
fees of the Commission and the National Association of Securities Dealers, Inc.,
(vi) the cost of printing certificates representing the Shares and (vii) the
cost and charges of any transfer agent or registrar.
6. Conditions of Underwriters' Obligations. The obligations of the
---------------------------------------
Underwriters to purchase and pay for the Firm Shares and the Additional Shares,
as provided herein, shall be subject to the accuracy of the representations and
warran ties of the Company herein contained, as of the date hereof and as of
the Closing Date (for purposes of this Section 6 "Closing Date" shall refer to
the Closing Date for the Firm Shares and any Additional Closing Date, if
different, for the Additional Shares), to the absence from any certificates,
opinions, written statements or letters furnished to you or to Underwriters'
Counsel pursuant to this Section 6 of any misstatement or omission, to the
performance by the Company of its obligations hereunder, and to the following
additional conditions:
(a) The Registration Statement, including any Rule 462(b)
Registration Statement, shall have become effective and all necessary approvals
of the Nasdaq National Market shall have been received not later than 5:30 P.M.,
New York time, on the date of this Agreement, or at such later time and date as
shall have been consented to in writing by you; if the Company shall have
elected to rely upon Rule 430A or Rule 434 of the Regulations, the Prospectus
shall have been filed with the Commission in a timely fashion in accordance with
Section 4(a) hereof; and at or prior to the Closing Date, no stop order
suspending the effectiveness of the Registra tion Statement or any post-
effective amendment thereof shall have been issued and no proceedings therefor
shall have been initiated or threatened by the Commission.
(b) At the Closing Date you shall have received the opinion of Ropes
& Xxxx counsel for the Company, dated the Closing Date, addressed to the
Underwriters and in form attached hereto as Exhibit B.
(c) All proceedings taken in connection with the sale of the Firm
Shares and the Additional Shares as herein contemplated shall be reasonably
satisfactory in form and substance to you and to Underwriters' Counsel, and the
Underwriters shall have received from said Underwriters' Counsel a favorable
opinion, dated as of the Closing Date with respect to the issuance and sale of
the Shares, the Registration Statement and the Prospectus and such other related
matters as you may reasonably require, and the Company shall have furnished to
Underwriters'
15
Counsel such documents as they reasonably request for the purpose of enabling
them to pass upon such matters.
(d) At the Closing Date you shall have received a certificate of the
Chief Executive Officer and Chief Financial Officer of the Company, dated the
Closing Date to the effect that (i) the condition set forth in subsection (a) of
this Section 6 has been satisfied, (ii) as of the date hereof and as of the
Closing Date the representations and warranties of the Company set forth in
Section 1 hereof are accurate, (iii) as of the Closing Date the obligations of
the Company to be performed hereunder on or prior thereto have been duly
performed and (iv) subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, the Company has not
sustained any material loss or interference with their respective businesses or
properties from fire, flood, hurricane, accident or other calamity, whether or
not covered by insurance, or from any labor dispute or any legal or governmental
proceeding, and there has not been any material adverse change, or any
development involving a material adverse change, in the business, prospects,
properties, operations, condition (financial or otherwise), or results of
operations of the Company, except in each case as described in or contemplated
by the Prospectus.
(e) At the time this Agreement is executed and at the Closing Date,
you shall have received a letter from PricewaterhouseCoopers, independent public
accountants for the Company, dated, respectively, as of the date of this
Agreement and as of the Closing Date addressed to the Underwriters and in form
and substance satisfactory to you, stating that: (i) they are independent
certified public accountants with respect to the Company within the meaning of
the Act and the Regulations and stating that the answer to Item 10 of the
Registration Statement is correct insofar as it relates to them; (ii) in their
opinion, the financial statements (including E-Systems Medical Electronics (a
division of Raytheon E-Systems, Inc.) and the unaudited proforma data) of the
Company included in the Registration Statement and the Prospectus and covered by
their opinion therein comply as to form in all material respects with the
applicable accounting requirements of the Act and the applicable published rules
and regulations of the Commission thereunder; (iii) on the basis of procedures
consisting of a reading of the latest available unaudited interim financial
statements of the Company a reading of the minutes of meetings and consents of
the stockholders and the board of directors of the Company and the committees of
such board subsequent to [ ,1999], inquiries of officers and other
employees of the Company who have responsibility for financial and accounting
matters of the Company with respect to transactions and events subsequent to [
,1999], a review of interim financial information in accordance with the
standards
16
established by the American Institute of Certified Public Accountants
in Statement of Auditing Standards No. 71, Interim Financial Information with
respect to the six-month period ended June 30, 1999 and other specified
procedures and inquiries to a date not more than five days prior to the date of
such letter, nothing has come to their attention that would cause them to
believe that: (A) the unaudited financial state ments and schedules of the
Company presented in the Registration Statement and the Prospectus do not comply
as to form in all material respects with the applicable accounting requirements
of the Act and, if applicable, the Exchange Act and the applicable published
rules and regulations of the Commission thereunder or that such unaudited
consolidated financial statements are not fairly presented in conformity with
generally accepted accounting principles applied on a basis substantially
consistent with that of the audited consolidated financial statements included
in the Registration Statement and the Prospectus; (B) with respect to the period
subsequent to June 30, 1999, there were, as of the date of the most recent
available monthly consolidated financial statements of the Company, if any, and
as of a specified date not more than five days prior to the date of such letter,
any changes in the capital stock or long-term indebtedness of the Company or any
decrease in the net current assets or stockholders' equity of the Company, in
each case as compared with the amounts shown in the most recent balance sheet
presented in the Registration Statement and the Prospectus, except for changes
or decreases which the Registra tion Statement and the Prospectus disclose have
occurred or may occur or which are set forth in such letter or (C) that during
the period from[ , 1999] to the date of the most recent available monthly
financial statements of the Company, if any, and to a specified date not more
than five days prior to the date of such letter, there was any decrease, as
compared with the corresponding period in the prior fiscal year, in total
revenues, or total or per share net income, except for decreases which the
Registra tion Statement and the Prospectus disclose have occurred or may occur
or which are set forth in such letter; and (iv) they have compared specific
dollar amounts, num bers of shares, percentages of revenues and earnings, and
other financial information pertaining to the Company set forth in the
Registration Statement and the Prospectus, which have been specified by you
prior to the date of this Agreement, to the extent that such amounts, numbers,
percentages, and information may be derived from the general accounting and
financial records of the Company or from schedules fur nished by the Company,
and excluding any questions requiring an interpretation by legal counsel, with
the results obtained from the application of specified readings, inquiries, and
other appropriate procedures specified by you set forth in such letter, and
found them to be in agreement.
17
(f) Prior to the Closing Date, the Company shall have furnished to
you copies of the undertaking of its directors, officers and shareholders,
referred to in Section 4(f) of this Agreement.
(g) Prior to the Closing Date, the Company shall have furnished to
you such further information, certificates and documents as you may reasonably
request.
(h) At the Closing Date, the Shares shall have been approved for
quotation on the Nasdaq National Market.
If any of the conditions specified in this Section 6 shall not have
been fulfilled when and as required by this Agreement, or if any of the
certificates, opinions, written statements or letters furnished to you or to
Underwriters' Counsel pursuant to this Section 6 shall not be in all material
respects reasonably satisfactory in form and substance to you and to
Underwriters' Counsel, all obligations of the Underwriters hereunder may be
canceled by you at, or at any time prior to, the Closing Date, and the
obligations of the Underwriters to purchase the Additional Shares may be
canceled by you at, or at any time prior to, the Additional Closing Date.
Notice of such cancellation shall be given to the Company in writing, or by
telephone, facsimile, telex or telegraph, confirmed in writing.
7. Indemnification.
---------------
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange Act against
any and all losses, liabilities, claims, damages and expenses whatsoever as
incurred (including but not limited to reasonable attorneys' fees and any and
all reasonable expenses whatsoever incurred in investigating, preparing or
defending against any litigation, commenced or threatened, or any claim
whatsoever, and any and all amounts paid in settlement of any claim or
litigation), joint or several, to which they or any of them may become subject
under the Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or any amend ment
thereof, or any related preliminary prospectus or the Prospectus, or in any
supplement thereto or amendment thereof, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated
18
therein or necessary to make the statements therein not misleading; provided,
however, that the Company will not be liable in any such case to the extent but
only to the extent that any such loss, liability, claim, damage or expense
arises out of or is based upon any such untrue statement or alleged untrue
statement or omission or alleged omission made therein in reliance upon and in
conformity with written information furnished to the Company relating to any
Underwriter through you expressly for use therein. This indemnity agreement will
be in addition to any liability which the Company may otherwise have including
under this Agreement.
(b) Each Underwriter severally, and not jointly, agrees to indemnify
and hold harmless the Company, each of the directors of the Company , each of
the officers of the Company who shall have signed the Registration State ment
and each other person, if any, who controls the Company within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act, against any losses,
liabilities, claims, damages and expenses whatsoever as incurred (including but
not limited to attorneys' fees and any and all reasonable expenses whatsoever
incurred in investigating, preparing or defending against any litigation,
commenced or threat ened, or any claim whatsoever, and any and all amounts paid
in settlement of any claim or litigation), joint or several, to which they or
any of them may become subject under the Act, the Exchange Act or otherwise,
insofar as such losses, liabilities, claims, damages or expenses (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement or
any amendment thereof, or any related preliminary prospectus or the Prospectus,
or in any amendment thereof or supple ment thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that any such
loss, liability, claim, damage or expense arises out of or is based upon any
such untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information furnished to the Company relating to any Underwriter through you
expressly for use therein; provided, however, that in no case shall any
Underwriter be liable or responsible for any amount in excess of the
underwriting discount applicable to the Shares purchased by such Underwriter
hereunder. This indemnity will be in addition to any liability which any
Underwriter may otherwise have including under this Agreement. The Company
acknowledges that the statements set forth in the last sentence of the last
paragraph of the cover page and in the last sentence of the fourth paragraph,
the eighth paragraph, the eleventh paragraph, the twelfth paragraph and the
thirteenth paragraph under the caption "Underwriting" in the Prospectus
19
constitute the only information furnished in writing by or on behalf of any
Underwriter expressly for use in the Registration Statement or in any amendment
thereof, any related preliminary prospectus or the Prospectus or in any
amendment thereof or supplement thereto, as the case may be.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify each party against whom indemni
fication is to be sought in writing of the commencement of such action (but the
failure so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 7, except to the extent the
indemnifying party is prejudiced thereby). In case any such action is brought
against any indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent it may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party. Notwithstanding the foregoing, the
indemnified party or parties shall have the right to employ its or their own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of such indemnified party or parties unless (i) the employment of
such counsel shall have been authorized in writing by one of the indemnifying
parties in connection with the defense of such action, (ii) the indemnifying
parties shall not have employed counsel to take charge of the defense of such
action within a reason able time after notice of commencement of the action, or
(iii) such indemnified party or parties shall have been advised by counsel that
there may be defenses available to it or them which are different from or
additional to those available to one or all of the indemnifying parties (in
which case the indemnifying parties shall not have the right to direct the
defense of such action on behalf of the indemnified party or parties), in any of
which events such fees and expenses shall be borne by the indemnifying parties.
In no event shall the indemnifying parties be liable for fees and expenses of
more than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. Anything in this section to the
contrary notwithstand ing, an indemnifying party shall not be liable for any
settlement of any claim or action effected without its written consent;
provided, however, that such consent was not unreasonably withheld.
20
8. Contribution. In order to provide for contribution in
------------
circumstances in which the indemnification provided for in Section 7 hereof is
for any reason held to be unavailable from any indemnifying party or is
insufficient to hold harmless a party indemnified thereunder, the Company and
the Underwriters shall contribute to the aggregate losses, claims, damages,
liabilities and expenses of the nature contem plated by such indemnification
provision (including any reasonable investigation, legal and other expenses
incurred in connection with, and any amount paid in settlement of, any action,
suit or proceeding or any claims asserted, but after deduct ing in the case of
losses, claims, damages, liabilities and expenses suffered by the Company any
contribution received by the Company from persons, other than the Underwriters,
who may also be liable for contribution, including persons who control the
Company within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act, officers of the Company who signed the Registration Statement and
directors of the Company) as incurred to which the Company and one or more of
the Underwriters may be subject, in such proportions as is appropriate to
reflect the relative benefits received by the Company and the Underwriters from
the offering of the Shares or, if such allocation is not permitted by applicable
law, in such propor tion as is appropriate to reflect not only the relative
benefits referred to above but also the relative fault of the Company and the
Underwriters in connection with the statements or omissions which resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative benefits received by the
Company and the Underwriters shall be deemed to be in the same proportion as (x)
the total proceeds from the offering (net of underwriting discounts and
commissions but before deducting expenses) received by the Company and (y) the
underwriting discounts and commissions received by the Underwriters,
respectively, in each case as set forth in the table on the cover page of the
Prospec tus. The relative fault of the Company and of the Underwriters shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company or the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission or any
violation of the nature referred to in Section 7(a)(ii). The Company and the
Underwriters agree that it would not be just and equitable if contribution
pursuant to this Section 8 were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other method
of allocation which does not take account of the equitable considerations
referred to above. Notwithstanding the provisions of this Section 8, (i) in no
case shall any Underwriter be liable or responsible for any amount in excess of
the underwriting discount applicable to the Shares purchased by such Underwriter
21
hereunder, and (ii) no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. Notwithstanding
the provisions of this Section 8 and the preceding sentence, no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the Shares underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages that such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. For purposes of this
Section 8, each person, if any, who controls an Underwriter within the meaning
of Section 15 of the Act or Section 20(a) of the Exchange Act shall have the
same rights to contribution as such Underwriter, and each person, if any, who
controls the Company within the meaning of Section 15 of the Act or Section
20(a) of the Exchange Act, each officer of the Company who shall have signed the
Registration Statement and each director of the Company shall have the same
rights to contribution as the Company, subject in each case to clauses (i) and
(ii) of this Section 8. 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 against another
party or parties, notify each party or parties from whom contribution may be
sought, but the omission to so notify such party or parties shall not relieve
the party or parties from whom contribution may be sought from any obligation it
or they may have under this Section 8 or otherwise. No party shall be liable
for contribution with respect to any action or claim settled without its written
consent; provided, however, that such consent was not unreasonably withheld.
9. Default by an Underwriter.
-------------------------
(a) If any Underwriter or Underwriters shall default in its or their
obligation to purchase Firm Shares or Additional Shares hereunder, and if the
Firm Shares or Additional Shares with respect to which such default relates do
not (after giving effect to arrangements, if any, made by you pursuant to
subsection (b) below) exceed in the aggregate 10% of the number of Firm Shares
or Additional Shares, as the case may be, the Firm Shares or Additional Shares
to which the default relates shall be purchased by the non-defaulting
Underwriters in proportion to the respective proportions which the numbers of
Firm Shares set forth opposite their respective names in Schedule I hereto bear
to the aggregate number of Firm Shares set forth opposite the names of the non-
defaulting Underwriters.
22
(b) In the event that such default relates to more than 10% of the
total number of Firm Shares or Additional Shares, as the case may be, you may in
your discretion arrange for yourself or for another party or parties (including
any non-defaulting Underwriter or Underwriters who so agree) to purchase such
Firm Shares or Additional Shares, as the case may be, to which such default
relates on the terms contained herein. In the event that within five calendar
days after such a default you do not arrange for the purchase of the Firm Shares
or Additional Shares, as the case may be, to which such default relates as
provided in this Section 9, this Agreement or, in the case of a default with
respect to the Additional Shares, the obligations of the Underwriters to
purchase and of the Company to sell the Addi tional Shares shall thereupon
terminate, without liability on the part of the Company (except in each case as
provided in Section 5, 7(a) and 8 hereof) or the Underwriters, but nothing in
this Agreement shall relieve a defaulting Underwriter or Underwriters of its or
their liability, if any, to the other Underwriters and the Company for damages
occasioned by its or their default hereunder.
(c) In the event that the Firm Shares or Additional Shares to which
such default relates are to be purchased by the non-defaulting Underwriters, or
are to be purchased by another party or parties as aforesaid, you or the Company
shall have the right to postpone the Closing Date or Additional Closing Date, as
the case may be for a period, not exceeding five Business Days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus or in any other documents and arrangements, and the
Company agrees to file promptly any amendment or supplement to the Registration
Statement or the Prospectus which, in the opinion of Underwriters' Counsel, may
thereby be made necessary or advisable. The term "Underwriter" as used in this
Agreement shall include any party substituted under this Section 9 with like
effect as if it had originally been a party to this Agreement with respect to
such Firm Shares and Additional Shares, as the case may be.
10. Survival of Representations and Agreements. All representations
------------------------------------------
and warranties, covenants and agreements of the Underwriters and the Company
contained in this Agreement, including the agreements contained in Section 5
hereof, the indemnity agreements contained in Section 7 hereof and the
contribution agreements contained in Section 8 hereof, shall remain operative
and in full force and effect regardless of any investigation made by or on
behalf of any Underwriter or any controlling person thereof or by or on behalf
of the Company, any of its officers and directors or any controlling person
thereof and shall survive delivery of and payment for the Shares to and by the
Underwriters. The representations contained
23
in Section 1 and the agreements contained in Sections 5, 7, 8 and 11(d) hereof
shall survive the termination of this Agreement, including termination pursuant
to Section 9 or 11 hereof.
11. Effective Date of Agreement; Termination.
----------------------------------------
(a) This Agreement shall become effective, upon the later of (i) such
time as you and the Company shall have received notification of the effec
tiveness of the Registration Statement and (ii) the execution of this Agreement.
If either the initial public offering price or the purchase price per Share has
not been agreed upon prior to 5:00 P.M., New York time, on the fifth full
Business Day after the Registration Statement shall have become effective, this
Agreement shall thereupon terminate without liability to the Company or the
Underwriters except as herein expressly provided. Until this Agreement becomes
effective as aforesaid, it may be terminated by the Company by notifying you or
by you notifying the Company. Notwithstanding the foregoing, the provisions of
this Section 11 and of Sections 1, 5, 7 and 8 hereof shall at all times be in
full force and effect.
(b) You shall have the right to terminate this Agreement at any time
prior to the Closing Date or the obligations of the Underwriters to purchase the
Additional Shares at any time prior to the Additional Closing Date, as the case
may be, if (i) any domestic or international event or act or occurrence has
materially disrupted, or in your opinion will in the immediate future materially
disrupt, the market for the Company's securities or securities in general; (ii)
if trading on the New York Stock Exchange or the Nasdaq National Market shall
have been sus pended, or minimum or maximum prices for trading shall have been
fixed, or maximum ranges for prices for securities shall have been required, on
the New York Stock Exchange or the Nasdaq National Market by the New York Stock
Exchange or the Nasdaq National Market or by order of the Commission or any
other governmen tal authority having jurisdiction; or (iii) if a banking
moratorium has been declared by a state or federal authority or if any new
restriction materially adversely affecting the distribution of the Firm Shares
or the Additional Shares, as the case may be, shall have become effective; or
(iv) (A) if the United States becomes engaged in hostilities or there is an
escalation of hostilities involving the United States or there is a declaration
of a national emergency or war by the United States or (B) if there shall have
been such change in political, financial or economic conditions if the effect of
any such event in (A) or (B) as in your judgment makes it impracticable or
inadvis able to proceed with the offering, sale and delivery of the Firm Shares
or the Addi tional Shares, as the case may be, on the terms contemplated by the
Prospectus.
24
(c) Any notice of termination pursuant to this Section 11 shall be by
telephone, facsimile, telex, or telegraph, confirmed in writing by letter.
(d) If this Agreement shall be terminated pursuant to any of the
provisions hereof (otherwise than pursuant to (i) notification by you as
provided in Section 11(a) hereof or (ii) Section 9(b) or 11(b) hereof), or if
the sale of the Shares provided for herein is not consummated because any
condition to the obliga tions of the Underwriters set forth herein is not
satisfied or because of any refusal, inability or failure on the part of the
Company to perform any agreement herein or comply with any provision hereof, the
Company will, subject to demand by you, reimburse the Underwriters for all out-
of-pocket expenses (including the fees and expenses of their counsel), incurred
by the Underwriters in connection herewith.
12. Notice. All communications hereunder, except as may be otherwise
specifically provided herein, shall be in writing and, if sent to any Under
writer, shall be mailed, delivered, sent by facsimile, telex or telegraph and
confirmed in writing by letter, to such Underwriter c/o Bear, Xxxxxxx & Co.
Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx X. Xxxxxxx,
Managing Director, fax no. (000) 000-0000; or if sent to the Company, shall be
mailed, delivered, or sent by facsimile, telex or telegraph and confirmed in a
letter to the Company, 00 Xxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000-0000,
Attention: Xxxxx X. Xxxxxxx, President and Chief Executive Officer, fax no.
(000) 000-0000 with a copy to Ropes & Xxxx, Xxx Xxxxxxxxxxxxx Xxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000-0000, Attention Xxxx X. Xxxxxxxx, fax no. (000) 000-0000.
13. Parties. This Agreement shall insure solely to the benefit of,
and shall be binding upon, the Underwriters and the Company and the controlling
persons, directors, officers, employees and agents referred to in Sections 7 and
8, and their respective successors and assigns, and no other person shall have
or be con strued to have any legal or equitable right, remedy or claim under or
in respect of or by virtue of this Agreement or any provision contained herein.
The term "successors and assigns" shall not include a purchaser, in its capacity
as such, of Shares from any of the Underwriters.
14. Governing Law. This agreement shall be governed by and construed
-------------
in accordance with the laws of the State of New York, but without regard to
principles of conflicts of law.
25
15. Counterparts. This Agreement may be executed in counterparts,
------------
each of which shall be an original and all of which together shall constitute
one and the same instrument.
26
If the foregoing correctly sets forth the understanding between you
and the Company, please so indicate in the space provided below for that
purpose, whereupon this letter shall constitute a binding agreement among us.
Very truly yours,
eMed Technologies Corporation
By:____________________________________________
Name:
Title:
Accepted as of the date first above written
BEAR, XXXXXXX & CO. INC.
XXXXXXXXX, LUFKIN & XXXXXXXX SECURITIES CORPORATION
WIT CAPITAL CORPORATION
By: BEAR, XXXXXXX & CO. INC.
By: ___________________________
Name:
Title:
On behalf of themselves and the other
Underwriters named in Schedule I hereto.
27
SCHEDULE I
Number of Firm Shares
Name of Underwriter to be Purchased
----------------------------------------- ---------------------
Bear, Xxxxxxx & Co. Inc..................
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities
Corporation.............................
Wit Capital Corporation..................
Total............................. _________
SCHEDULE II
[Form of Lock-up]
SCHEDULE III
[List of Officers, Directors and Stockholders participating in the Lock-up]
EXHIBIT A
[List of Patents & Trademarks owned by eMed]
EXHIBIT B
[ Ropes & Xxxx opinion]
EXHIBIT B
[FORM OF ROPES & XXXX OPINION]
October __, 1999
BEAR, XXXXXXX & CO. INC.
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES CORPORATION
WIT CAPITAL CORPORATION,
As Representatives of the
Several Underwriters Named
in the Underwriting Agreement
Re: Shares of Common Stock,
$ .01 par value, of eMed Technologies Corporation
---------------------------------------------------
Ladies and Gentlemen:
We have acted as counsel for eMed Technologies Corporation, a Delaware
corporation (the "Company"), in connection with the issuance and sale by the
Company of ________ shares (the "Shares") of its Common Stock, $.01 par value
per share (the "Common Stock"). This opinion is furnished to you as
Representatives of the several Underwriters pursuant to Section 6(b) of the
underwriting agreement dated October __, 1999 (the "Underwriting Agreement"),
among the Company and you as Representatives of the several Underwriters listed
on Schedule I thereto relating to the issuance and sale of the Shares. Terms
defined in the Underwriting Agreement and not otherwise defined herein are used
herein with the meanings so defined.
We have attended the Closing of the sale of the Shares held today. We have
examined signed copies of the registration statement of the Company on Form S-1
(No. 333-85481), together with all amendments and all exhibits thereto (the
"Registration Statement"), all as filed with the Securities and Exchange
Commission (the "Commission") under the Securities Act of
1933, as amended (the "Act"); a copy of the prospectus dated _________ relating
to the Shares filed with the Commission pursuant to Rule 424(b) under the Act
(the "Prospectus"), which included information that under Rule 430A under the
Act was deemed to be included in the Registration Statement at the time it was
declared effective; an executed copy of the Underwriting Agreement; and such
other documents as we have deemed necessary as a basis for the opinions
expressed herein. For purposes of our opinion in the second sentence of
paragraph 6 below, we have assumed that the Underwriting Agreement and the
waivers received by the Company from the holders of rights to require
registration of Common Stock have been duly authorized, executed, and delivered
by the parties thereto other than the Company. For purposes of our opinion in
paragraph 10 below, we have relied solely on the publicly available records of
the United States Patent and Trademark Office. Additionally, we have relied upon
oral advice from the staff of the Commission to the effect that the Registration
Statement became effective on _____________.
We express no opinion as to the laws of any jurisdiction other than those
of the General Corporation Law of the State of Delaware (the "DGCL"), the
Commonwealth of Massachusetts and the federal laws of the United States of
America.
Insofar as this opinion relates to factual matters, information with
respect to which is in the possession of the Company, we have made inquiries to
the extent we believe reasonable with respect to such matters and have relied
upon representations made by the Company in the Underwriting Agreement and
representations made to us by one or more officers of the Company. Although we
have not independently verified the accuracy of such representations, we do not
know of the existence or absence of any fact contradicting such representations.
-2-
Any reference herein to "our knowledge," "known to us" or any variation thereof
shall mean the actual knowledge of lawyers in this firm who have participated in
our representation of the Company in connection with the preparation of the
Registration Statement. With respect to our opinion set forth in paragraph 4
below, we have not searched the dockets of any court, administrative body,
agency or other filing office in any jurisdiction.
Based upon and subject to the foregoing, we are of the opinion that:
1. The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, with corporate
power to own, lease and operate its properties and conduct its business
as described in the Prospectus, and is qualified as a foreign
corporation in the Commonwealth of Massachusetts.
2. The authorized, issued and outstanding capital stock of the Company is
as set forth in the Capitalization table contained in the Prospectus,
except for issuances or forfeitures subsequent to the date of the
information provided in such table, if any, pursuant to the Company's
stock plan or outstanding options and warrants. The Shares and the other
shares of Common Stock (including the Common Stock issued upon
conversion of preferred stock) issued and outstanding on this date have
been duly authorized and validly issued and are fully paid and
nonassessable. The issuance of the Shares to the Underwriters is not
subject to statutory preemptive rights or, to our knowledge, any
contractual preemptive rights.
3. The Underwriting Agreement has been duly authorized, executed and
delivered by the Company.
-3-
4. The execution and delivery of the Underwriting Agreement and the
issuance and sale by the Company of the Shares will not (i) violate or
conflict with the Certificate of Incorporation or By-Laws of the
Company, (ii) breach or result in a default under any agreement or
instrument listed as an Exhibit to the Registration Statement or (iii)
violate the DGCL or any applicable federal law or regulation or, to our
knowledge, any order, writ, injunction or decree of any jurisdiction,
court or governmental instrumentality binding upon the Company or any of
its properties, except that we express no opinion as to state securities
or blue sky laws or as to compliance with the antifraud provisions of
federal and state securities laws.
5. No authorizations or consents of any governmental entity are required to
permit the Company to issue and sell the Shares except such as may be
required under state securities or blue sky laws, as to which we express
no opinion, and except for such as have been obtained under the Act.
6. To our knowledge, except as described in the Prospectus, no holder of
any security of the Company has the right to require registration of
shares of Common Stock of the Company in connection with the
registration of the Shares. To our knowledge, all such rights with
respect to the Registration Statement have been effectively waived.
Further, to our knowledge, no holders of any security of the Company
have the right to require the Company to register shares of Common Stock
for 180 days after the effective date of the
-4-
Registration Statement other than in connection with a future
registered offering by the Company.
7. The Company is not, and immediately following the offering will not be,
subject to regulation as an "investment company" under the Investment
Company Act of 1940, as amended.
8. The statements in the Prospectus under the section "Description of
Capital Stock," insofar as they purport to summarize the provisions of
documents or matters of law referred to therein or constitute legal
conclusions, are accurate in all material respects and the statements
in the Prospectus under the section "Business -- Production," insofar
as they purport to summarize the provisions of documents, are accurate
in all material respects.
9. The form of certificate evidencing the Common Stock has been approved
by all necessary corporate action of the Company and complies as to
form with the requirements of the DGCL.
10. The Company, under its former name, is listed in the records of the
United States Patent and Trademark Office as the sole current owner of
record of United States registered marks "EMED" and "FRAMEWAVE"
numbered 1,965,898 and 2,072,753, respectively. These registrations are
current, in force and not abandoned.
The Registration Statement became effective on ___________________. We do
not know of the issuance of any stop order suspending the effectiveness of the
Registration Statement by the Commission or of any proceeding for that purpose
under the Act.
-5-
In the course of the preparation by the Company of the Registration
Statement and the Prospectus, we have participated in discussions with your
representatives and those of the Company and its independent accountants, in
which the business and affairs of the Company and the contents of the
Registration Statement and the Prospectus were discussed. On the basis of
information that we have gained in the course of our representation of the
Company in connection with its preparation of the Registration Statement and the
Prospectus and our participation in the discussions referred to above, we
believe that the Registration Statement, as of its effective date, and the
Prospectus, as of its date, complied as to form in all material respects with
the requirements of the Act and the published rules and regulations of the
Commission thereunder, and we do not know of any legal or governmental
proceeding to which the Company or any of its subsidiaries is a party or to
which any of its property is subject required to be described in the Prospectus
which is not so described, nor of any contract or other document of a character
required to be described in the Prospectus or to be filed as an exhibit to the
Registration Statement which is not so described or filed. Further, based on
such information and participation, nothing that has come to our attention has
caused us to believe that as of its effective date the Registration Statement
contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading, or that the Prospectus as of its date or as of the date
hereof contained or contains any untrue statement of a material fact or omitted
or omits to state any material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading. We
express no opinion, however, as to the financial statements, including the notes
and schedules thereto, or any other financial
-6-
or accounting information set forth or referred to in the Registration Statement
or the Prospectus.
The limitations inherent in the independent verification of factual matters
and the character of the determinations involved in our review are such that we
do not assume any responsibility for the accuracy, completeness or fairness of
the statements made or the information contained in the Registration Statement
or Prospectus except as described in paragraph 8 above.
This opinion is furnished by us to you as Representatives of the several
Underwriters and, except as otherwise expressly consented to by us in writing,
is solely for the benefit of the several Underwriters.
Very truly yours,
Ropes & Xxxx
-7-
