Exhibit 1.1
5,043,177 Shares
I-TRAX, INC.
Shares of Common Stock
($0.001 par value)
PLACEMENT AGENT AGREEMENT
-------------------------
December 17, 2004
▇▇▇▇▇▇▇▇▇▇▇ & Co. Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
I-trax, Inc., a Delaware corporation (the "Company"), and certain
shareholders of the Company named in Schedule I hereto (the "Selling
Shareholders"), confirm their agreement with ▇▇▇▇▇▇▇▇▇▇▇ & Co. Inc.
("Oppenheimer") with respect to the sale by the Selling Shareholders of an
aggregate of 5,043,177 issued and outstanding shares of common stock, par value
$0.001 per share (the "Common Stock"), of the Company pursuant to the terms of
this Placement Agent Agreement (this "Agreement") and the purchase agreement in
the form of Exhibit A attached hereto (the "Purchase Agreement") entered into
with the purchasers identified therein (each a "Purchaser" and, collectively,
the "Purchasers"). The aggregate of 5,043,177 shares so proposed to be sold by
the Selling Shareholders is hereinafter referred to as the "Stock."
Section 1. Agreement To Act As Placement Agent. On the basis of the
representations, warranties and agreements of the Company and the Selling
Shareholders herein contained, and subject to all the terms and conditions of
this Agreement:
(a) The Company and the Selling Shareholders hereby authorize
▇▇▇▇▇▇▇▇▇▇▇ to act as the exclusive agent for the Selling Shareholders
(in such capacity, the "Placement Agent") to solicit offers for the
purchase of all or part of the Stock from the Selling Shareholders in
connection with the proposed offering of the Stock (the "Offering").
Until the Closing Date, the Company and the Selling Shareholders shall
not, without the prior consent of the Placement Agent, solicit or
accept offers to purchase Stock otherwise than through the Placement
Agent.
(b) The Placement Agent agrees, as agent of the Selling Shareholders,
to use its best efforts to solicit offers to purchase the Stock from
the Selling Shareholders on the terms and subject to the conditions set
forth in the Base Prospectus (as defined below) and the Prospectus
Supplement (as defined below). The Placement Agent shall make
commercially reasonable efforts to assist the Selling Shareholders in
obtaining performance by each
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Purchaser whose offer to purchase Stock has been solicited by the
Placement Agent and accepted by the Selling Shareholders, but the
Placement Agent shall not, except as otherwise provided in this
Agreement, have any liability to the Company or the Selling
Shareholders in the event any such purchase is not consummated for any
reason. Under no circumstances will the Placement Agent be obligated to
purchase any Stock for its own account and, in soliciting purchases of
Stock, the Placement Agent shall act solely as the agent of the Selling
Shareholders and not as principal. Notwithstanding the foregoing and
except as otherwise provided in Section 1(c), it is understood and
agreed that the Placement Agent (or its affiliates) may, solely at its
discretion and without any obligation to do so, purchase Stock as
principal.
(c) Subject to the provisions of this Section 1, offers for the
purchase of Stock may be solicited by the Placement Agent as agent for
the Selling Shareholders at such times and in such amounts as the
Placement Agent deems advisable. The Placement Agent shall communicate
to the Selling Shareholders, orally or in writing, each reasonable
offer to purchase Stock received by it as agent of the Selling
Shareholders. The Selling Shareholders shall have the sole right to
accept offers to purchase the Stock and may reject any such offer, in
whole or in part. The Placement Agent shall have the right, in its
discretion reasonably exercised, without notice to the Selling
Shareholders, to reject any offer to purchase Stock received by it, in
whole or in part, and any such rejection shall not be deemed a breach
of its agreement contained herein.
(d) The purchases of the Stock by the Purchasers shall be evidenced by
the execution of the Purchase Agreement by each of the parties thereto.
(e) As compensation for services rendered, on the Closing Date (as
defined below) each Selling Shareholder shall pay or cause to be paid
to the Placement Agent by wire transfer of immediately available funds
to an account or accounts designated by the Placement Agent, an amount
equal to six percent (6.0%) of the gross proceeds received by such
Selling Shareholder from the sale of the Stock on such Closing Date.
(f) No Stock which any Selling Shareholder shall have agreed to sell
pursuant to this Agreement shall be deemed to have been purchased and
paid for, or sold by such Selling Shareholder, until such Stock shall
have been delivered to the Purchaser thereof against payment therefor
by such Purchaser. If any Selling Shareholder shall default in its
obligation to deliver Stock to a Purchaser whose offer has been
accepted, such Selling Shareholder shall indemnify and hold the
Placement Agent harmless against any loss, claim or damage arising from
or as a result of such default by such Selling Shareholder.
Section 2. (I) Representations And Warranties Of The Company. The Company
represents and warrants to, and agrees with, the Placement Agent and the
Purchasers that:
(a) Securities Law Filings. The Company meets the requirements for use
of Form S-3 under the Securities Act of 1933, as amended (the
"Securities Act"), for secondary offerings and has filed with the
Securities and Exchange Commission (the "Commission") a registration
statement on such Form S-3 (Registration File No. 333-114604), which
became effective as of November 30, 2004, for the registration under
the Securities Act of the Stock. Such registration statement meets the
requirements set forth in Rule 415(a)(1)(i) under the
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Securities Act and complies in all other material respects with said
Rule. The Company will file with the Commission pursuant to Rule 424(b)
under the Securities Act, and the rules and regulations (the "Rules and
Regulations") of the Commission promulgated thereunder, a supplement to
the form of prospectus included in such registration statement relating
to the placement of the Stock and the plan of distribution thereof and
has advised the Placement Agent of all further information (financial
and other) with respect to the Company and, to the extent known by the
Company, the Selling Shareholders required to be set forth therein.
Such registration statement, including the exhibits thereto, as amended
at the date of this Agreement, is hereinafter called the "Registration
Statement"; such prospectus relating to the Stock to be sold by the
Selling Shareholders in the form in which it appears in the
Registration Statement is hereinafter called the "Base Prospectus"; and
the supplemented form of prospectus, in the form in which it will be
filed with the Commission pursuant to Rule 424(b) (including the Base
Prospectus as so supplemented) is hereinafter called a "Prospectus
Supplement." Any reference herein to the Registration Statement, the
Base Prospectus or the Prospectus Supplement shall be deemed to refer
to and include the documents incorporated by reference therein (the
"Incorporated Documents") pursuant to Item 12 of Form S-3 which were
filed under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), on or before the date of this Agreement, or the issue
date of the Base Prospectus or the Prospectus Supplement, as the case
may be; and any reference herein to the terms "amend," "amendment" or
"supplement" with respect to the Registration Statement, the Base
Prospectus or the Prospectus Supplement shall be deemed to refer to and
include the filing of any document under the Exchange Act after the
date of this Agreement, or the issue date of the Base Prospectus or the
Prospectus Supplement, as the case may be, deemed to be incorporated
therein by reference. All references in this Agreement to financial
statements and schedules and other information which is "contained,"
"included," "described," "set forth" or "stated" in the Registration
Statement, the Base Prospectus or the Prospectus Supplement (and all
other references of like import) shall be deemed to mean and include
all such financial statements and schedules and other information which
is or is deemed to be incorporated by reference in the Registration
Statement, the Base Prospectus or the Prospectus Supplement, as the
case may be.
(b) No Stop Order. No stop order suspending the effectiveness of the
Registration Statement or the use of the Base Prospectus or the
Prospectus Supplement has been issued, and no proceeding for any such
purpose is pending or has been initiated or, to the best of the
Company's knowledge, is threatened by the Commission.
(c) Compliance with Applicable Regulations. The Registration Statement
(and any further documents to be filed with the Commission in
connection with transactions contemplated by this Agreement) contains
all exhibits and schedules as required by the Securities Act. Each of
the Registration Statement and any post-effective amendment thereto, at
the time it became effective, complied in all material respects with
the Securities Act and the Exchange Act and the applicable Rules and
Regulations and did not and, as amended or supplemented, if applicable,
will not, contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading. The Base Prospectus and the
Prospectus Supplement, each as of its respective date, comply in all
material respects with the Securities Act and the Exchange Act and the
applicable Rules and Regulations. Each of the Base Prospectus and the
Prospectus Supplement, as amended or supplemented, did not and will not
contain as of
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the date thereof any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The Incorporated Documents, when they were filed with the
Commission, conformed in all material respects to the requirements of
the Exchange Act and the applicable Rules and Regulations, and none of
such documents, when they were filed with the Commission, contained any
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein not misleading; and any
further documents so filed and incorporated by reference in the Base
Prospectus or Prospectus Supplement, when such documents are filed with
the Commission, will conform in all material respects to the
requirements of the Exchange Act and the applicable Rules and
Regulations, as applicable, and will not contain any untrue statement
of a material fact or omit to state a material fact necessary to make
the statements therein not misleading. Notwithstanding the foregoing,
the Company makes no representations or warranties as to (i)
information, if any, contained in or omitted from the Prospectus
Supplement 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 the Placement Agent specifically for use in
the Prospectus Supplement, which information the parties hereto agree
is limited to the Placement Agent's Information as defined in Section
15 or (ii) information furnished in writing to the Company by or on
behalf of the Selling Shareholders for use in the Registration
Statement or the Prospectus Supplement. No post-effective amendment to
the Registration Statement reflecting any facts or events arising after
the date thereof which represent, individually or in the aggregate, a
fundamental change in the information set forth therein is required to
be filed with the Commission.
(d) Reports and Documents. There are no documents required to be filed
with the Commission in connection with the transaction contemplated
hereby that (x) have not been filed as required pursuant to the
Securities Act or (y) will not be filed within the requisite time
period. There are no contracts or other documents required to be
described in the Base Prospectus or Prospectus Supplement, or to be
filed as exhibits or schedules to the Registration Statement, which
have not been described or filed as required.
(e) Offering Materials Furnished to the Placement Agent. The Company
has delivered, or will as promptly as practicable deliver, to the
Placement Agent complete conformed copies of the Registration Statement
and of each consent and certificate of experts filed as a part thereof,
and conformed copies of the Registration Statement (without exhibits)
and the Base Prospectus and the Prospectus Supplement, as amended or
supplemented, in such quantities and at such places as the Placement
Agent reasonably requests.
(f) Distribution of Offering Materials.Neither the Company nor any of
its directors and officers has distributed and none of them will
distribute, prior to the completion of the distribution of Stock, any
offering material in connection with the offering and sale of the Stock
other than the Base Prospectus, the Prospectus Supplement, the
Registration Statement, copies of the documents incorporated by
reference therein and any other materials permitted by the Securities
Act.
(g) Incorporation and Good Standing. The Company and each of its
subsidiaries has been duly organized and is validly existing as a
corporation or other legal entity in good
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standing (or the equivalent thereof, if any) under the laws of its
respective jurisdiction of incorporation, is duly qualified to do
business and is in good standing (or the equivalent thereof, if any) as
a foreign corporation in each jurisdiction in which its respective
ownership or lease of property or the conduct of its respective
business requires such qualification, and has all power and authority
necessary to own or hold its respective properties and to conduct the
businesses in which it is engaged, except where the failure to be so
qualified and in good standing or have such power or authority would
not have, singularly or in the aggregate, a material adverse effect on
the condition (financial or otherwise), results of operations,
business, properties or prospects of the Company and its subsidiaries
taken as a whole (a "Material Adverse Effect").
(h) Capitalization and Capital Stock Matters. The Company has an
authorized and outstanding capitalization as set forth in the Base
Prospectus and the Prospectus Supplement (other than for issuances
after the date hereof, if any, pursuant to employee benefit plans
described in the Prospectus Supplement or upon exercise of outstanding
options or warrants or conversion of Series A Convertible Preferred
Stock, par value $0.001 per share (the "Preferred Stock"), described in
the Prospectus Supplement). All of the issued and outstanding shares of
capital stock of the Company (including the shares of Stock to be sold
by the Selling Shareholders) have been duly and validly authorized and
issued, are fully paid and non-assessable, have been issued in
compliance with federal and state securities laws, and conform to the
description thereof contained in the Base Prospectus and the Prospectus
Supplement. None of the outstanding shares of Common Stock was issued
in violation of any preemptive rights, rights of first refusal or other
similar rights to subscribe for or purchase securities of the Company.
Except as set forth on Schedule 2(I)(h) attached hereto, there are no
authorized or outstanding options, warrants, preemptive rights, rights
of first refusal or other rights to purchase, or equity or debt
securities convertible into or exchangeable or exercisable for, any
capital stock of the Company or any of its subsidiaries that have been
granted by the Company other than those accurately described in the
Base Prospectus and the Prospectus Supplement.
(i) Capitalization of Subsidiaries. All the outstanding shares of
capital stock or other equity interests of each subsidiary of the
Company have been duly authorized and validly issued, are fully paid
and nonassessable, except where such failure to have been duly
authorized, validly issued and fully paid would not have singularly or
in the aggregate a Material Adverse Effect and, except to the extent
set forth in the Base Prospectus and the Prospectus Supplement, are
owned by the Company directly or indirectly through one or more
wholly-owned subsidiaries, free and clear of any claim, lien,
encumbrance, security interest, defect or restriction upon voting or
transfer or any other claim of any kind ("Liens").
(j) Authorization; Enforceability. The Company has the full right,
power and authority to enter into this Agreement and the Purchase
Agreement and to perform and to discharge its obligations hereunder and
thereunder; and each of this Agreement and the Purchase Agreement has
been duly authorized, executed and delivered by the Company, and
constitutes a valid and binding obligation of the Company enforceable
in accordance with its terms.
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(k) Non-Contravention of Existing Instruments. The execution, delivery
and performance of this Agreement and the Purchase Agreement by the
Company and the consummation of the transactions contemplated hereby
and thereby will not conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under (i)
any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its subsidiaries
is a party or by which the Company or any of its subsidiaries is bound
or to which any of the property or assets of the Company or any of its
subsidiaries is subject, (ii) the provisions of the charter or by-laws
of the Company or any of its subsidiaries, (iii) any statute, law, rule
or regulation applicable to the Company or any of its subsidiaries or
(iv) any judgment, order or decree of any court or governmental agency
or body having jurisdiction over the Company or any of its subsidiaries
or any of their properties or assets except, with respect to clauses
(i) or (iii), any conflicts, breaches or violations, which, singularly
or in the aggregate, would not have a Material Adverse Effect.
(l) No Consents, Approvals or Authorizations Required. No consent,
approval, authorization, filing with or order of or registration with,
any court or governmental agency or body is required in connection with
the transactions contemplated herein and in the Purchase Agreement,
except (i) such as have been obtained or made under the Securities Act
or the Exchange Act and such as may be required by securities or blue
sky laws of any jurisdiction in connection with the offer and sale of
the Stock by the Selling Shareholders in the manner contemplated herein
and in the Base Prospectus and the Prospectus Supplement and (ii)
clearance with the National Association of Securities Dealers, Inc.
("NASD").
(m) No Applicable Registration or Similar Rights. Except as set forth
on Schedule 2(I)(m) attached hereto, there are no contracts, agreements
or understandings between the Company and any person granting such
person the right to require the Company to file a registration
statement under the Securities Act with respect to any securities of
the Company or to require the Company to include such securities with
the Shares registered pursuant to the Registration Statement, except
for such rights as have been duly waived or satisfied.
(n) Financial Statements. The financial statements, together with the
related notes and schedules, of the Company included in the Base
Prospectus, the Prospectus Supplement or the Registration Statement, or
incorporated by reference therein, as the case may be, present fairly
the financial condition, results of operations, cash flows and
stockholders' equity of the Company and its consolidated subsidiaries
and other consolidated entities as of the dates and for the periods
indicated, comply in all material respects with the Securities Act and
the Rules and Regulations, and have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the periods involved. No other financial statements or
supporting schedules or exhibits are required by the Securities Act or
the Rules and Regulations thereunder to be included in the Base
Prospectus, the Prospectus Supplement or the Registration Statement, or
incorporated by reference therein, as the case may be.
(o) No Actions, Suits or Proceedings. Except as set forth in the Base
Prospectus and the Prospectus Supplement, there is no legal or
governmental proceeding pending to which the Company or any of its
subsidiaries is a party or of which any property or assets of the
Company or any of its subsidiaries is the subject which is required to
be described in the
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Base Prospectus or the Prospectus Supplement and is not described
therein, or which, singularly or in the aggregate, if determined
adversely to the Company or any of its subsidiaries, would reasonably
be expected to have a Material Adverse Effect or would prevent or
adversely affect the ability of the Company to perform its obligations
under this Agreement; and to the best of the Company's knowledge, no
such proceedings are threatened or contemplated by governmental
authorities or threatened by others.
(p) Title to Properties. The Company and each of its subsidiaries have
good and marketable title to all property (real and personal) described
in the Registration Statement, the Base Prospectus and the Prospectus
Supplement as being owned by the Company or its subsidiaries, in each
case free and clear of all Liens, except for those Liens that do not
materially interfere with the use made or proposed to be made of such
property by the Company or its subsidiaries or that would not
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect; all the property described in the Registration
Statement, the Base Prospectus and the Prospectus Supplement as being
held under lease by the Company or a subsidiary is held thereby under
valid, subsisting and enforceable leases except where the failure to be
valid, subsisting or enforceable would not individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect, in
each case, except as described in the Base Prospectus and the
Prospectus Supplement.
(q) No Defaults or Violations.Neither the Company nor any of its
subsidiaries is (i) in violation of any provision of its charter or
bylaws, (ii) in default in any respect, and no event has occurred
which, with notice or lapse of time or both, would constitute such a
default, in the due performance or observance of any term, covenant, or
condition of any indenture, contract, lease, mortgage, deed of trust,
note agreement, loan agreement or other agreement, obligation,
condition, covenant or instrument to which it is a party or by which it
is bound or to which any of its property or assets is subject, or (iii)
in violation in any respect of any statute, law, rule, regulation,
ordinance, judgment, order or decree of any court, regulatory body,
administrative agency, governmental body, arbitrator or other authority
having jurisdiction over the Company, its subsidiaries or any of its
properties, as applicable, except, with respect to clauses (ii) and
(iii), any violations or defaults which, singularly or in the
aggregate, would not have a Material Adverse Effect.
(r) Labor Matters. No labor problem, dispute, strike, slowdown or work
stoppage with the employees of the Company or any of its subsidiaries
exists or, to the best of the Company's knowledge, is threatened or
imminent, which would reasonably be expected to have a Material Adverse
Effect. The Company is not aware that any key employee or significant
group of employees of the Company or any subsidiary plans to terminate
employment with the Company or any such subsidiary.
(s) ERISA. Each of the Company and its subsidiaries has fulfilled its
obligations, if any, under the minimum funding standards of ▇▇▇▇▇▇▇ ▇▇▇
▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Employee Retirement Income Security Act of 1974
("ERISA") and the regulations and published interpretations thereunder
with respect to each "plan" (as defined in Section 3(3) of ERISA and
such regulations and published interpretations) in which employees of
the Company and its subsidiaries are eligible to participate and each
such plan is in compliance in all material respects with the presently
applicable provisions of ERISA and such regulations and published
interpretations. No "prohibited transaction" (as defined in Section 406
of
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ERISA, or Section 4975 of the Internal Revenue Code of 1986, as amended
from time to time (the "Code")) has occurred with respect to any
employee benefit plan which could have a Material Adverse Effect. The
Company and each of its subsidiaries has not incurred any unpaid
liability to the Pension Benefit Guaranty Corporation (other than for
the payment of premiums in the ordinary course) or to any such plan
under Title IV of ERISA. Each "pension plan" (as defined in ERISA) 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 could cause the loss of such qualification.
(t) Insurance. The Company and each of its subsidiaries carry, or are
covered by, insurance in such amounts and covering such risks as is
adequate for the conduct of their respective businesses and the value
of their respective properties and as is customary for companies
engaged in similar businesses in similar industries; all such insurance
is fully in force on the date hereof and will be fully in force on the
Closing Date and is issued by recognized, financially sound and
reputable institutions.
(u) Permits. The Company and each of its subsidiaries has made all
filings, applications and submissions required by, and possesses all
approvals, licenses, certificates, certifications, clearances,
consents, exemptions, marks, notifications, orders, permits and other
authorizations issued by, the appropriate federal, state or foreign
regulatory authorities necessary to conduct its businesses
(collectively, "Permits"), except for such Permits which the failure to
obtain would not have a Material Adverse Effect, and is in material
compliance with the terms and conditions of all such Permits; all of
such Permits held by the Company and each of its subsidiaries are valid
and in full force and effect in each case, except as described in the
Base Prospectus or the Prospectus Supplement.
(v) [Intentionally Omitted]
(w) ▇▇▇▇▇▇▇▇-▇▇▇▇▇. The principal executive officer and principal
financial officer of the Company have made all certifications required
by the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 and the rules and regulations
promulgated in connection therewith (the "▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act"), and the
statements contained in any such certification are complete and
correct. The Company maintains "disclosure controls and procedures" (as
defined in Rule 13a-14(c) under the Exchange Act), and such controls
and procedures are designed (i) to ensure that information required to
be disclosed by the Company in the reports that it files or submits
under the Exchange Act is recorded, processed, summarized and reported,
within the time periods specified in the Commission's rules and forms
and (ii) to ensure that information required to be disclosed by the
Company in the reports that it files or submits under the Exchange Act
is accumulated and communicated to the Company's management, including
its principal executive officer and principal financial officer, as
appropriate to allow timely decisions regarding required disclosure.
The Company is otherwise in compliance in all material respects with
all applicable effective provisions of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act and the
rules and regulations promulgated by the Commission (and intends to
comply with all applicable provisions that are not yet effective upon
effectiveness).
(x) Accounting Controls. The Company and each of its subsidiaries
maintains a system of internal accounting controls sufficient to
provide reasonable assurance that (i)
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transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability of
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 the existing assets at
reasonable intervals and appropriate action is taken with respect to
any differences.
(y) Environmental Laws. The Company and each of its subsidiaries (i) is
in compliance in all material respects with any and all applicable
foreign, federal, state and local laws and regulations relating to the
protection of human health and safety, the environment or hazardous or
toxic substances or wastes, pollutants or contaminants ("Environmental
Laws"), (ii) has received and is in compliance with all permits,
licenses or other approvals required of it under applicable
Environmental Laws to conduct its business and (iii) has not received
notice of any actual or potential liability for the investigation or
remediation of any disposal or release of hazardous or toxic substances
or wastes, pollutants or contaminants, except where such non-compliance
with Environmental Laws, failure to receive required permits, licenses
or other approvals, or liability would not, individually or in the
aggregate, have a Material Adverse Effect, whether or not arising from
transactions in the ordinary course of business, except as set forth in
or contemplated by the Base Prospectus and the Prospectus Supplement
(exclusive of any supplement thereto). The Company has not been named
as a "potentially responsible party" under the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as
amended.
(z) Intellectual Property. The Company and its subsidiaries own,
possess, license or have other rights to use all foreign and domestic
patents, patent applications, trade and service marks, trade and
service ▇▇▇▇ registrations, trade names, copyrights, licenses,
inventions, trade secrets, technology, Internet domain names, know-how
and other intellectual property (collectively, the "Intellectual
Property") necessary for the conduct of the Company's business as now
conducted or as proposed in the Base Prospectus and the Prospectus
Supplement to be conducted. Except as set forth in the Base Prospectus
and the Prospectus Supplement (a) to the best of the Company's
knowledge, there are no rights of third parties to any such
Intellectual Property, except where the exercise of such rights would
not result, singularly or in the aggregate, in a Material Adverse
Effect; (b) to the best of the Company's knowledge, there is no
infringement by third parties of any such Intellectual Property; (c)
there is no pending or, to the best of the Company's knowledge,
threatened action, suit, proceeding or claim by others challenging the
Company's or its subsidiaries' rights in or to any such Intellectual
Property, and the Company is unaware of any facts which would form a
reasonable basis for any such claim; (d) there is no pending or, to the
best of the Company's knowledge, threatened action, suit, proceeding or
claim by others challenging the validity or scope of any such
Intellectual Property; (e) there is no pending or, to the best of the
Company's knowledge, threatened action, suit, proceeding or claim by
others that the Company or its subsidiaries infringe or otherwise
violate any patent, trademark, copyright, trade secret or other
proprietary rights of others, and the Company is unaware of any other
fact which would form a reasonable basis for any such claim; (f) to the
best of the Company's knowledge, there is no third-party U.S. patent or
published U.S. patent application which contains claims for which an
Interference Proceeding could be
9
commenced against any patent or patent application described in the
Base Prospectus and the Prospectus Supplement as being owned by or
licensed to the Company; and (g) the Company and its subsidiaries have
taken all steps necessary to perfect its ownership of and interest in
the Intellectual Property.
(aa) Investment Company. Neither the Company nor any of its
subsidiaries is required to register as an "investment company" as such
term is defined in the Investment Company Act of 1940, as amended.
(bb) No Material Loss. Neither the Company nor any of its subsidiaries
has sustained, since the date of the latest audited financial
statements included in the Base Prospectus, the Prospectus Supplement
or the Registration Statement, or incorporated by reference therein, as
the case may be, any material loss or interference with its business
from fire, explosion, flood, terrorist act or other calamity, whether
or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth in or
contemplated by the Base Prospectus and the Prospectus Supplement.
(cc) No Material Adverse Change. Except as set forth in or as otherwise
contemplated by the Registration Statement, the Base Prospectus or the
Prospectus Supplement, subsequent to the respective dates as of which
information is given in the Registration Statement, the Base Prospectus
and the Prospectus Supplement, there has not been (i) any material
adverse change, or any development that would reasonably be expected to
result in a material adverse change, in the business, properties,
management, financial condition or results of operations of the Company
taken as a whole, (ii) any transaction which is material to the Company
taken as a whole, (iii) any obligation, direct or contingent (including
any off-balance sheet obligations), incurred by the Company outside the
ordinary course of business, which is material to the Company taken as
a whole, (iv) any change in the capital stock (other than the issuance
of shares of Common Stock upon the exercise of stock options and
warrants and the conversion of Preferred Stock disclosed as outstanding
in the Registration Statement, the Base Prospectus and the Prospectus
Supplement and the grant of options under existing stock option plans
described in the Registration Statement, the Base Prospectus and the
Prospectus Supplement) or outstanding indebtedness of the Company or
(v) any dividend or distribution of any kind declared, paid or made on
the capital stock of the Company.
(dd) Stock Exchange Listing. The Company is subject to the reporting
requirements of either Section 13 or Section 15(d) of the Exchange Act
and files reports with the Commission on the ▇▇▇▇▇ system. The Stock is
registered under the Exchange Act and is duly listed and admitted and
authorized for trading on the American Stock Exchange ("AMEX") and the
Company has taken no action designed to, or likely to have the effect
of terminating the registration of the Common Stock under the Exchange
Act or delisting or suspending from trading the Common Stock from AMEX,
nor has the Company received any information suggesting that the
Commission or the NASD is contemplating terminating or suspending such
registration or listing.
(ee) No Price Stabilization or Manipulation. Neither the Company nor
any of its subsidiaries nor any of their officers, directors or
affiliates has taken or will take, directly or indirectly, any action
designed or intended to stabilize or manipulate the price of any
10
security of the Company, or which caused or resulted in, or which might
in the future reasonably be expected to cause or result in,
stabilization or manipulation of the price of any security of the
Company.
(ff) Affiliations with NASD. There are no affiliations with the NASD
among the Company's officers, directors or, to the best of the
knowledge of the Company, any five percent or greater stockholder of
the Company, except as set forth in the Base Prospectus, the Prospectus
Supplement or the Registration Statement or otherwise disclosed in
writing to the Placement Agent.
Any certificate signed by any officer of the Company or any of its subsidiaries
and delivered to the Placement Agent or counsel for the Placement Agent in
connection with the offering of the Stock shall be deemed a representation and
warranty by the Company and its subsidiaries, as to the matters covered thereby,
to the Placement Agent and each of the Purchasers as to the matters covered
thereby.
(II) Representations And Warranties Of The Selling Shareholders. Each
Selling Shareholder, severally and not jointly, represents and warrants to, and
agrees with, the Placement Agent and the Purchasers that:
(a) Title to Stock. Upon delivery of the Stock to be sold by such
Selling Shareholder pursuant to this Agreement and the Purchase
Agreement, and payment therefor pursuant hereto and thereto, good and
valid title to such shares, free and clear of all liens, encumbrances,
equities or claims, will pass to the Purchasers.
(b) Authority. Such Selling Shareholder has full right, power and
authority to enter into and deliver this Agreement and the Purchase
Agreement and to perform its obligations under such agreements.
(c) Non-Contravention of Existing Instruments. The execution, delivery
and performance of this Agreement and the Purchase Agreement by such
Selling Shareholder and the consummation by such Selling Shareholder of
the transactions contemplated hereby and thereby will not conflict with
or result in a material breach or violation of (i) any of the terms or
provisions of, or constitute a default under, any material indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which such Selling Shareholder is a party or by which
such Selling Shareholder is bound or to which any of the material
property or assets of such Selling Shareholder is subject, or (ii) any
provision of, in the case of a Selling Shareholder that is a
corporation, the provisions of its charter or by-laws, in the case of a
Selling Shareholder that is a partnership or limited liability company,
the provisions of its articles of organization, partnership agreement,
operating agreement or other similar agreement and, in the case of a
Selling Shareholder that is a trust, the deed of trust, and any statute
or any material order, rule or regulation of any court or governmental
agency or body having jurisdiction over such Selling Shareholder or the
property or assets of such Selling Shareholder.
(d) Consents. Except for the registration of the Stock under the
Securities Act and such consents, approvals, authorizations,
registrations or qualifications as may be required by the Company,
under the Exchange Act and applicable state securities laws in
connection
11
with the purchase of the Stock by the Purchasers or where the failure
to obtain such consent, approval, authorization, registration or
qualification would not have, singularly or in the aggregate, a
Material Adverse Effect, no consent, approval, authorization or order
of, or filing or registration with, any such court or governmental
agency or body is required for the execution, delivery and performance
of this Agreement and the Purchase Agreement by such Selling
Shareholder and the consummation by such Selling Shareholder of the
transactions contemplated hereby and thereby.
(e) Authorization; Enforceability. This Agreement and the Purchase
Agreement have each been duly authorized, executed and delivered by or
on behalf of such Selling Shareholder and, assuming due authorization,
execution and delivery by the other parties thereto, constitutes the
valid and legally binding agreement of such Selling Shareholder, except
as rights to indemnification hereunder and thereunder may be limited by
applicable law and except as the enforcement hereof and thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the rights and remedies of
creditors or by general equitable principles.
(f) Registration Statement. The Registration Statement does not, and
the Base Prospectus and the Prospectus Supplement and any further
amendments or supplements to the Registration Statement, Base
Prospectus or the Prospectus Supplement will not, as of the applicable
effective date (as to the Registration Statement and any amendment
thereto) and as of the applicable filing date (as to the Base
Prospectus or the Prospectus Supplement and any amendment or supplement
thereto) contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to
make the statements therein, in the case of the Base Prospectus and the
Prospectus Supplement, in light of the circumstances in which they were
made, not misleading; provided that this paragraph (f) shall apply only
to information contained in or omitted from the Registration Statement,
Base Prospectus or the Prospectus Supplement in reliance upon and in
conformity with written information relating to such Selling
Shareholder furnished to the Company by or on behalf of such Selling
Shareholder specifically for inclusion therein, it being understood and
agreed that the only such information furnished by any such Selling
Shareholder consists of the information about such Selling Shareholder
under the caption "Selling Security Holders" in the Base Prospectus and
the Prospectus Supplement.
(g) No Price Stabilization or Manipulation. Each Selling Shareholder
has not taken, and will not take, directly or indirectly, any action
designed or intended to stabilize or manipulate the price of any
security of the Company in connection with the Offering of the Stock.
(h) Non-Public Information. The decision by each Selling Shareholder to
sell the Stock owned by such Selling Shareholder pursuant hereto is not
prompted by any material non-public information concerning the Company
or any of its subsidiaries which is not set forth in the Base
Prospectus or the Prospectus Supplement.
(i) Delivery of Certificates. Prior to the Closing, such Selling
Shareholder shall have taken all reasonable steps necessary for (i) to
the extent such Selling Shareholder is selling shares of Common Stock
underlying shares of Preferred Stock of the Company owned by such
Selling Shareholder, the conversion of such shares of Preferred Stock,
12
including, but not limited to, delivery of a notice of conversion to
the Company and (ii) the delivery to the transfer agent for the Stock
of stock certificates in negotiable form for the Stock being sold in
the Offering.
Any certificate signed by or on behalf of a Selling Shareholder and
delivered to the Placement Agent or counsel for the Placement Agent in
connection with the offering of the Stock shall be deemed a representation and
warranty by such Selling Shareholder, as to the matters covered thereby, to the
Placement Agent and the Purchasers.
Section 3. The Closing. The time and date of closing and delivery of
the documents required to be delivered to the Placement Agent pursuant to
Section 6 hereof shall be at 10:00 A.M., local time, on December 22, 2004 (the
"Closing Date") at the office of ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ & Ingersoll, LLP, ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Section 4. (I) Further Agreements of the Company. The Company agrees
with the Placement Agent, the Selling Shareholders and the Purchasers:
(a) (i) to make no further amendment or supplement prior to the Closing
Date to the Registration Statement or any amendment or supplement to
the Prospectus Supplement without the consent of the Placement Agent,
which consent shall not be unreasonably withheld; (ii) for so long as
the delivery of a prospectus is required in connection with the
offering or sale of the Stock, to advise the Placement Agent promptly
after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any
supplement to the Prospectus Supplement or any amended Prospectus
Supplement has been filed and to furnish the Placement Agent with
copies thereof; (iii) to file promptly all reports and any definitive
proxy or information statements required to be filed by the Company
with the Commission and AMEX pursuant to Section 13(a), 15 or 15(d) of
the Exchange Act subsequent to the date of the Prospectus Supplement
and for so long as the delivery of a prospectus is required in
connection with the offering or sale of the Stock; (iv) to advise the
Placement Agent, promptly after it receives notices thereof, (x) of any
request by the Commission to amend the Registration Statement or to
amend or supplement the Prospectus Supplement or for additional
information and (y) 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 directed at any
Incorporated Document or any amendment or supplement thereto or any
order preventing or suspending the use of the Base Prospectus or the
Prospectus Supplement or any amendment or supplement thereto, of the
suspension of the qualification of the Stock for offering or sale in
any jurisdiction, of the institution or threatening of any proceeding
for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or Prospectus
Supplement or for additional information; and, (v) in the event of the
issuance of any stop order or of any order preventing or suspending the
use of the Base Prospectus or Prospectus Supplement or suspending any
such qualification, promptly to use its reasonable best efforts to
obtain the withdrawal of such order.
(b) To comply with the Securities Act and the Exchange Act, and the
Rules and Regulations, so as to permit the completion of the
distribution of the Stock as contemplated in this Agreement and the
Prospectus Supplement. If during the period in which a prospectus is
required by law to be delivered by the Placement Agent or a dealer in
connection with the
13
distribution of Stock contemplated by the Prospectus Supplement, any
event shall occur as a result of which, in the judgment of the Company
or the Selling Shareholders or in the reasonable opinion of the
Placement Agent or counsel for the Placement Agent, it becomes
necessary to amend or supplement the Prospectus Supplement in order to
make the statements therein, in the light of the circumstances existing
at the time the Prospectus Supplement is delivered to a purchaser, not
misleading, or, if it is necessary at any time to amend or supplement
the Prospectus Supplement to comply with any law, the Company promptly
will prepare and file with the Commission, and furnish at its own
expense to the Placement Agent and to dealers, an appropriate amendment
to the Registration Statement or supplement to the Prospectus
Supplement so that the Prospectus Supplement as so amended or
supplemented will not, in the light of the circumstances when it is so
delivered, be misleading, or so that the Prospectus Supplement will
comply with such law. Before amending the Registration Statement or
supplementing the Base Prospectus in connection with the Offering, the
Company will furnish the Placement Agent with a copy of such proposed
amendment or supplement and will not file such amendment or supplement
to which the Placement Agent reasonably objects.
(c) To furnish promptly to the Placement Agent and to counsel for the
Placement Agent a copy of the Registration Statement as originally
filed with the Commission, and each amendment thereto filed with the
Commission, including all consents and exhibits filed therewith.
(d) To deliver promptly to the Placement Agent such number of the
following documents as the Placement Agent shall reasonably request:
(i) conformed copies of the Registration Statement as originally filed
with the Commission and each amendment thereto (in each case excluding
exhibits), (ii) the Base Prospectus, (iii) the Prospectus Supplement
(not later than 10:00 A.M., New York time, on the Business Day
following the execution and delivery of this Agreement) and any
amendment or supplement thereto (not later than 10:00 A.M., New York
City time, on the Business Day following the date of such amendment or
supplement); and (iv) any document incorporated by reference in the
Base Prospectus or Prospectus Supplement. The Company will pay the
expenses of printing or other production of all documents relating to
the Offering.
(e) To make generally available to its stockholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule 158(c)
under the Securities Act), an earnings statement of the Company (which
need not be audited) complying with Section 11(a) of the Securities Act
and the Rules and Regulations (including, at the option of the Company,
Rule 158).
(f) To promptly take from time to time such actions as the Placement
Agent may reasonably request to qualify the Stock for offering and sale
under the securities, or blue sky, laws of such jurisdictions
(including without limitation any post-filing requirements) as the
Placement Agent may designate and to continue such qualifications in
effect for so long as required for the distribution of the Stock, and
the Company will pay the fee of the NASD in connection with its review
of the Offering, if applicable. The Company shall not be obligated to
qualify as a foreign corporation in any jurisdiction in which it is not
so qualified or to file a general consent to service of process in any
jurisdiction.
14
(g) Not to directly or indirectly offer, sell, assign, transfer,
pledge, contract to sell, or otherwise dispose of any shares of Common
Stock or securities convertible into or exercisable or exchangeable for
Common Stock for a period of ninety (90) days from the date of the
Prospectus Supplement, other than (i) for consideration per share that
is equal to or greater than the price per share of Stock being sold in
the Offering and (ii) the issuance of shares underlying currently
outstanding options, warrants or rights. The Company will cause each of
its executive officers and directors to furnish to the Placement Agent,
at the Execution Time, a letter, substantially in the form of Exhibit B
attached hereto, pursuant to which each such person shall agree not to
directly or indirectly offer, sell, assign, transfer, pledge, contract
to sell, or otherwise dispose of any shares of Common Stock or
securities convertible into or exercisable or exchangeable for Common
Stock for the Lock-Up Period (as defined in the form of agreement
attached as Exhibit B hereto) without the prior written consent of the
Placement Agent. If (i) the Company issues an earnings release or
material news or a material event relating to the Company occurs during
the last 17 days of the Lock-Up Period, or (ii) prior to the expiration
of the Lock-Up Period, the Company announces that it will release
earnings results during the 16-day period beginning on the last day of
the Lock-Up Period, the restrictions imposed by this Section 4(g) shall
continue to apply until the expiration of the 18-day period beginning
on the issuance of the earnings release or the occurrence of the
material news or material event.
(h) Prior to the Closing Date, to furnish to the Placement Agent, as
soon as they have been prepared, copies of any unaudited interim
consolidated financial statements of the Company for any periods
subsequent to the periods covered by the financial statements appearing
or incorporated by reference in the Base Prospectus, the Prospectus
Supplement or the Registration Statement.
(i) Prior to the Closing Date, not to issue any press release or other
communication directly or indirectly or hold any press conference with
respect to the Company, its condition, financial or otherwise, or
earnings, business affairs or business prospects (except for routine
oral marketing communications in the ordinary course of business and
consistent with the past practices of the Company and of which the
Placement Agent is notified), without the prior written consent of the
Placement Agent, unless in the judgment of the Company and its counsel,
and after notification to the Placement Agent, such press release or
communication is required by law. In such event, the Company shall
consult with the Placement Agent as to the contents of such press
release.
(j) To engage and maintain, at its expense, a registrar and transfer
agent for the Stock.
(k) To supply the Placement Agent with copies of all correspondence to
and from, and all documents issued to and by, the Commission in
connection with the registration of the Stock under the Securities Act.
(l) The Company will use its best efforts to maintain the listing of
the Stock on the American Stock Exchange.
(II) Further Agreements of the Selling Shareholders. The Selling
Shareholders, severally and not jointly, agree with the Placement Agent and the
Purchasers that they will deliver to the Placement Agent on or prior to the
Closing Date a properly completed and executed United States
15
Treasury Department Form W-8 (if the Selling Shareholder is a non-United States
person) or Form W-9 (if the Selling Shareholder is a United States person) or
such other applicable form or statement, if any, specified by Treasury
Department regulations in lieu thereof.
Section 5. Payment of Expenses. The Company agrees with the Selling Shareholders
and the Placement Agent to pay (a) the costs incident to the sale, preparation
and delivery of the Stock to the Purchasers and any taxes payable in that
connection; (b) the costs incident to the Registration of the Stock under the
Securities Act; (c) the costs incident to the preparation, printing and
distribution of the Registration Statement, Base Prospectus and Prospectus
Supplement and any amendments and exhibits thereto or any document incorporated
by reference therein, and the costs of printing, reproducing and distributing,
this Agreement by mail, telex or other means of communication; (d) the fees and
expenses (including related fees and expenses of counsel for the Placement
Agent) incurred in connection with filings, if any, made with the NASD, if
applicable; (e) any applicable listing or other fees; (f) the fees and expenses
of qualifying the Stock under the securities laws of the several jurisdictions
as provided in Section 4(f) and of preparing, printing and distributing Blue Sky
Memoranda (including related fees and expenses of counsel to the Placement
Agent); (g) all fees and expenses of the registrar and transfer agent of the
Stock; (h) the fees and expenses of counsel for the Placement Agent in an amount
not to exceed $35,000 in the aggregate; and (i) all other costs and expenses
incident to the performance of the obligations of the Company under this
Agreement (including, without limitation, the fees and expenses of the Company's
counsel and the Company's independent accountants and the travel and other
expenses incurred by Company personnel in connection with any "roadshow"
including, without limitation, any expenses advanced by the Placement Agent on
the Company's or Selling Shareholders' behalf (which will be promptly
reimbursed)); provided that, except as otherwise provided in this Section 5 and
in Sections 7 and 9, the Placement Agent shall pay its own costs and expenses,
including the fees and expenses of its counsel.
Section 6. Conditions to the Obligations of the Placement Agent and the
Purchasers, and the Sale of the Stock. The respective obligations of the
Placement Agent and the Purchasers, and the closing of the sale of the Stock
hereunder are subject to the accuracy, when made and on the Closing Date, of the
representations and warranties on the part of the Company and the Selling
Shareholders contained herein, to the accuracy of the statements of the Company
and the Selling Shareholders made in any certificates pursuant to the provisions
hereof, to the performance by the Company and the Selling Shareholders of their
obligations hereunder, and to each of the following additional terms and
conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose
shall have been initiated or threatened by the Commission, and any
request for additional information on the part of the Commission (to be
included in the Registration Statement, the Base Prospectus or the
Prospectus Supplement or otherwise) shall have been complied with to
the reasonable satisfaction of the Placement Agent. Any filings
required to be made by the Company in accordance with Section 4(a)
shall have been timely filed with the Commission.
(b) The Placement Agent shall not have discovered and disclosed to the
Company on or prior to the Closing Date that the Registration
Statement, the Base Prospectus or the Prospectus Supplement or any
amendment or supplement thereto contains an untrue statement of a fact
which, in the opinion of counsel for the Placement Agent, is material
or
16
omits to state any fact which, in the opinion of such counsel, is
material and is required to be stated therein or is necessary to make
the statements therein not misleading.
(c) All corporate proceedings and other legal matters incident to the
authorization, form, execution, delivery and validity of each of this
Agreement, the Stock, the Registration Statement, the Base Prospectus
and the Prospectus Supplement and all other legal matters relating to
this Agreement and the transactions contemplated hereby shall be
reasonably satisfactory in all material respects to counsel for the
Placement Agent, and the Company and the Selling Shareholders shall
have furnished to such counsel all documents and information that they
may reasonably request to enable them to pass upon such matters.
(d) The Placement Agent shall have received from ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
& Ingersoll, LLP, counsel for the Company, such counsel's written
opinion, addressed to the Placement Agent and the Purchasers and dated
as of the Closing Date, in form and substance reasonably satisfactory
to the Placement Agent. The Placement Agent shall have also received
from the Company's Vice President and General Counsel a written
opinion, addressed to the Placement Agent and the Purchasers and dated
as of the Closing Date, in form and substance reasonably satisfactory
to the Placement Agent.
The Company's Vice President and General Counsel shall also
have furnished to the Placement Agent a written statement, addressed to
the Placement Agent and the Purchasers and dated the Closing Date, in
form and substance satisfactory to the Placement Agent, to the effect
that (x) such counsel has acted as counsel to the Company in connection
with the preparation of the Registration Statement, (y) based on such
counsel's examination of the Registration Statement and such counsel's
investigations made in connection with the preparation of the
Registration Statement and conferences with certain officers and
employees of and with auditors for and counsel to the Company, such
counsel has no reason to believe that (I) the Registration Statement,
as of its effective date, contained any untrue statement of a 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 Base Prospectus or the Prospectus Supplement
contains any untrue statement of a material fact or omits 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 or (II) any document incorporated by
reference in the Base Prospectus or the Prospectus Supplement or any
further amendment or supplement to any such incorporated document made
by the Company prior to the Closing Date, when they became effective or
were filed with the Commission, as the case may be, contained, in the
case of a registration statement which became effective under the
Securities Act, any untrue statement of a 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, in the case of
other documents which were filed under the Exchange Act with the
Commission, any untrue statement of a material fact or omitted to state
any material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading;
it being understood that such counsel need express no opinion as to the
financial statements or other financial data contained in the
Registration Statement, the Base Prospectus or the Prospectus
Supplement.
17
(e) (i) The Placement Agent shall have received from ▇▇▇▇▇▇▇ ▇▇▇▇ &
▇▇▇▇▇▇▇▇▇ LLP, counsel for Warburg, ▇▇▇▇▇▇ Ventures, L.P., such
counsel's written opinion, addressed to the Placement Agent and dated
as of the Closing Date, in form and substance reasonably satisfactory
to the Placement Agent.
(ii) The Placement Agent shall have received from ▇▇▇▇, Weiss,
Rifkind, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel for CHD Investors, LLC, such
counsel's written opinion, addressed to the Placement Agent and dated
as of the Closing Date, in form and substance reasonably satisfactory
to the Placement Agent.
(f) The Placement Agent shall have received from ▇▇▇▇▇ Raysman
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, such opinion or opinions, dated the
Closing Date and addressed to the Placement Agent, with respect to the
sale of the Stock, the Registration Statement, the Base Prospectus, the
Prospectus Supplement (together with any supplement thereto) and other
related matters as the Placement Agent may reasonably require, and the
Company and the Selling Shareholders shall have furnished to such
counsel such documents as they reasonably request for the purpose of
enabling them to pass upon such matters.
(g) The Company shall have furnished to the Placement Agent and the
Purchasers a certificate, dated as of the Closing Date, executed by its
Chairman of the Board, its Chief Executive Officer or a Vice President
and its Chief Financial Officer stating that (i) such officers have
carefully examined the Registration Statement, the Base Prospectus and
the Prospectus Supplement and, in their opinion, the Registration
Statement (including the Base Prospectus) as of its effective date and
the Prospectus Supplement, as of each such effective date, did not
include any untrue statement of a material fact and did not omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading, (ii) since the effective
date of the Registration Statement no event has occurred which should
have been set forth in a supplement or amendment to the Registration
Statement, the Base Prospectus or the Prospectus Supplement, (iii) to
the best of their knowledge after reasonable investigation, as of the
Closing Date, the representations and warranties of the Company and its
subsidiaries in this Agreement are true and correct and the Company has
complied with all agreements and covenants contained in this Agreement
and satisfied all conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date, (iv) subsequent to the date
of the most recent financial statements included or incorporated by
reference in the Base Prospectus and the Prospectus Supplement, there
has been no change in the financial position or results of operation of
the Company and its subsidiaries that would have a Material Adverse
Effect, or any change, or any development including a prospective
change, in or affecting the condition (financial or otherwise), results
of operations, business or prospects of the Company and its
subsidiaries taken as a whole, except as set forth in the Base
Prospectus and the Prospectus Supplement, and (v) the Registration
Statement became effective on November 30, 2004, and to the best of
their knowledge, as of the Closing Date (I) no stop order suspending
the effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been commenced or are pending before
or are contemplated by the Commission and (II) no action has been taken
by any governmental agency, body or official, and no injunction,
restraining order or order of any nature by any federal or state court
has been issued, which would prevent the sale of the Stock.
18
(h) At the time of the execution of this Agreement, the Placement Agent
shall have received from each of ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP and Ernst
& Young LLP a letter, addressed to the Placement Agent and dated such
date, in form and substance satisfactory to the Placement Agent (i)
confirming that they are independent certified public accountants with
respect to the Company within the meaning of the Securities Act and the
Rules and Regulations and (ii) stating the conclusions and findings of
such firm with respect to the financial statements and certain
financial information contained or incorporated by reference in the
Base Prospectus and the Prospectus Supplement.
(i) On the Closing Date, the Placement Agent shall have received a
letter (the "bring-down letter") from each of ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
LLP and Ernst & Young LLP addressed to the Placement Agent, and dated
the Closing Date confirming, as of the date of the bring-down letter
(or, with respect to matters involving changes or developments since
the respective dates as of which specified financial information is
given in the Base Prospectus and the Prospectus Supplement as of a date
not more than three Business Days prior to the date of the bring-down
letter), the conclusions and findings of such firm with respect to the
financial information and other matters covered by its letter delivered
to the Placement Agent concurrently with the execution of this
Agreement pursuant to Section 6(h).
(j) Each Selling Shareholder shall have furnished to the Placement
Agent and the Purchasers a certificate, dated as of the Closing Date,
signed by, or on behalf of, such Selling Shareholder stating that the
representations and warranties of such Selling Shareholder contained
herein are true and correct as of the Closing Date with the same force
and effect as if made as of the Closing Date and that such Selling
Shareholder has complied in all material respects with all agreements
contained herein to be performed by such Selling Shareholder at or
prior to the Closing Date.
(k) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Base Prospectus and the
Prospectus Supplement any loss or interference with its business from
fire, explosion, flood, terrorist act or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth in or
contemplated by the Base Prospectus and the Prospectus Supplement, and
(ii) since such date there shall not have been any change in the
capital stock or long-term debt of the Company or any of its
subsidiaries or any change, or any development involving a prospective
change, in or affecting the business, general affairs, management,
financial position, stockholders' equity, results of operations or
prospects of the Company and its subsidiaries, otherwise than as set
forth in or contemplated by the Base Prospectus and the Prospectus
Supplement, the effect of which, in any such case described in clause
(i) or (ii), is, in the judgment of the Placement Agent, so material
and adverse as to make it impracticable or inadvisable to proceed with
the sale or delivery of the Stock on the terms and in the manner
contemplated by the Base Prospectus and the Prospectus Supplement.
(l) The Stock is registered under the Exchange Act and, as of the
Closing Date, shall be listed and admitted and authorized for trading
on the American Stock Exchange, and satisfactory evidence of such
actions shall have been provided to the Placement Agent. The Company
shall have taken no action designed to, or likely to have the effect of
terminating
19
the registration of the Stock under the Exchange Act or delisting or
suspending from trading the Stock from AMEX, nor has the Company
received any information suggesting that the Commission or AMEX is
contemplating terminating such registration or listing.
(m) At the Execution Time, the Company shall have furnished to the
Placement Agent a letter substantially in the form of Exhibit B hereto
from each executive officer and director of the Company.
(n) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange, the Nasdaq National Market or
the AMEX or in the over-the-counter market, or trading in any
securities of the Company on any exchange or in the over-the-counter
market, shall have been suspended or minimum or maximum prices or
maximum ranges for prices shall have been established on any such
exchange or such market by the Commission, by such exchange or by any
other regulatory body or governmental authority having jurisdiction,
(ii) a banking moratorium shall have been declared by Federal or state
authorities or a material disruption has occurred in commercial banking
or securities settlement or clearance services in the United States,
(iii) there shall have been an outbreak or an escalation in hostilities
involving the United States or there shall have been a declaration of a
national emergency or war by the United States or (iv) there shall have
occurred any other calamity or crisis or any change in general
economic, political or financial conditions in the United States or
elsewhere, if the effect of any such event in clause (iii) or (iv)
makes it, in the sole judgment of the Placement Agent, impracticable or
inadvisable to proceed with the sale or delivery of the Stock on the
terms and in the manner contemplated by the Base Prospectus and the
Prospectus Supplement.
(o) No action shall have been taken and no statute, rule, regulation or
order shall have been enacted, adopted or issued by any governmental
agency or body which would, as of the Closing Date, prevent the sale of
the Stock or be reasonably likely to result in a Material Adverse
Effect on the Company; and no injunction, restraining order or order of
any other nature by any federal or state court of competent
jurisdiction shall have been issued as of the Closing Date which would
prevent the sale of the Stock or be reasonably likely to result in a
Material Adverse Effect on the Company.
(p) The Company shall have prepared and filed with the Commission a
Current Report on Form 8-K with respect to the Offering, including as
an exhibit thereto this Agreement and any other documents relating
thereto.
(q) The Company and the Selling Shareholders shall have entered into
the Purchase Agreement with each of the Purchasers and such agreement
shall be in full force and effect.
(r) ▇▇▇▇▇ Raysman ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, on behalf of the
Placement Agent, shall have submitted information regarding this
transaction to the NASD for review under NASD Rule 2710 and the NASD
shall have raised no objection to the fairness and reasonableness of
the proposed placement agent terms and arrangements among the Company,
the Selling Shareholders and the Placement Agent.
20
(s) Prior to the Closing Date, the Company and the Selling Shareholders
shall have furnished to the Placement Agent such further information,
certificates and documents as the Placement Agent may reasonably
request.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Placement Agent.
Section 7. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless the Placement Agent,
its partners, officers, employees, representatives and agents and each
person, if any, who controls the Placement Agent within the meaning of
the Securities Act (collectively the "Placement Agent Indemnified
Parties" and each a "Placement Agent Indemnified Party") against any
loss, claim, damage or liability, joint or several, or any action in
respect thereof, to which the Placement Agent Indemnified Party may
become subject, under the Securities Act or otherwise, insofar as such
loss, claim, damage, liability or action arises out of or is based upon
(i) any untrue statement or alleged untrue statement of a material fact
contained in the Base Prospectus, the Registration Statement or the
Prospectus Supplement or in any amendment or supplement thereto or (ii)
the omission or alleged omission to state in the Base Prospectus, the
Registration Statement or the Prospectus Supplement or in any amendment
or supplement thereto a material fact required to be stated therein or
necessary to make the statements therein not misleading, and shall
reimburse each Placement Agent Indemnified Party promptly upon demand
for any legal or other expenses reasonably incurred by that Placement
Agent Indemnified Party in connection with investigating or preparing
to defend or defending against or appearing as a third party witness in
connection with any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company shall
not be liable in any such case to the extent that any such loss, claim,
damage, liability or action arises out of or is based upon an untrue
statement or alleged untrue statement in or omission or alleged
omission from the Base Prospectus, the Registration Statement or the
Prospectus Supplement or any such amendment or supplement in reliance
upon and in conformity with written information furnished to the
Company through the Placement Agent specifically for use therein, which
information the parties hereto agree is limited to the Placement
Agent's Information (as defined in Section 15). This indemnity
agreement is not exclusive and will be in addition to any liability,
which the Company might otherwise have and shall not limit any rights
or remedies which may otherwise be available at law or in equity to
each Placement Agent Indemnified Party.
(b) Each Selling Shareholder shall, severally and not jointly,
indemnify and hold harmless the Placement Agent Indemnified Parties
against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which that Placement Agent Indemnified
Party may become subject, under the Securities Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of
or is based upon (i) any untrue statement or alleged untrue statement
of a material fact contained in the Base Prospectus, the Registration
Statement or the Prospectus Supplement or in any amendment or
supplement thereto or (ii) the omission or alleged omission to state in
the Base Prospectus, the Registration Statement or the Prospectus
Supplement or in any amendment or supplement
21
thereto a material fact required to be stated therein or necessary to
make the statements therein not misleading, and shall reimburse each
Placement Agent Indemnified Party promptly upon demand for any legal or
other expenses reasonably incurred by that Placement Agent Indemnified
Party in connection with investigating or preparing to defend or
defending against or appearing as a third party witness in connection
with any such loss, claim, damage, liability or action as such expenses
are incurred; provided, however, that such Selling Shareholder shall
only be subject to indemnification, hold harmless and reimbursement
obligations under this subsection (b) only to the extent that such
loss, claim, damage, liability or action arises out of or is based upon
an untrue statement or alleged untrue statement in or omission or
alleged omission from any of such documents in reliance upon and in
conformity with written information provided to the Company by such
Selling Shareholder specifically for use therein, it being understood
and agreed that the only such information furnished by any such Selling
Shareholder consists of the information about such Selling Shareholder
under the caption "Selling Security Holders" in the Base Prospectus and
the Prospectus Supplement (the "Selling Shareholders' Information");
and provided, further, that the liability under this Section 7 of each
Selling Shareholder shall be limited to an amount equal to the
aggregate net proceeds, after deducting placement fees, received by
such Selling Shareholder from the sale of the Stock sold by such
Selling Shareholder hereunder. This indemnity agreement is not
exclusive and will be in addition to any liability which the Selling
Shareholders might otherwise have and shall not limit any rights or
remedies which may otherwise be available at law or in equity to each
Placement Agent Indemnified Party.
(c) The Placement Agent shall indemnify and hold harmless the Company,
its officers, employees, representatives and agents, each of its
directors and each person, if any, who controls the Company within the
meaning of the Securities Act (collectively the "Company Indemnified
Parties" and each a "Company Indemnified Party") and the Selling
Shareholders, their respective officers, employees, partners,
representatives, and agents and each person, if any, who controls the
Selling Shareholders within the meaning of the Securities Act
(collectively, the "Selling Shareholder Indemnified Parties" and each a
"Selling Shareholder Indemnified Party") against any loss, claim,
damage or liability, joint or several, or any action in respect
thereof, to which the Company Indemnified Parties or Selling
Shareholder Indemnified Parties may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of or is based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in
the Base Prospectus, the Registration Statement or the Prospectus
Supplement or in any amendment or supplement thereto or (ii) 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, but in each case only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission
was made in reliance upon and in conformity with written information
furnished to the Company by the Placement Agent specifically for use
therein, and shall reimburse the Company Indemnified Parties and the
Selling Shareholder Indemnified Parties for any legal or other expenses
reasonably incurred by such parties in connection with investigating or
preparing to defend or defending against or appearing as third party
witness in connection with any such loss, claim, damage, liability or
action as such expenses are incurred; provided that the parties hereto
hereby agree that such written information provided by the Placement
Agent consists solely of the Placement Agent's Information. This
indemnity agreement is not exclusive and will be in addition to
22
any liability, which the Placement Agent and the Purchasers might
otherwise have and shall not limit any rights or remedies which may
otherwise be available at law or in equity to the Company Indemnified
Parties and the Selling Shareholder Indemnified Parties.
Notwithstanding the provisions of this Section 7(c), in no event shall
any indemnity by the Placement Agent under this Section 7(c) exceed the
total compensation received by such Placement Agent in accordance with
Section 1(e).
(d) Promptly after receipt by an indemnified party under this Section 7
of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under this Section 7, notify the
indemnifying party in writing of the claim or the commencement of that
action; provided, however, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have under
this Section 7 except to the extent it has been materially prejudiced
by such failure; and, provided, further, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may
have to an indemnified party otherwise than under this Section 7. If
any such claim or action shall be brought against an indemnified party,
and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that
it wishes, jointly with any other similarly notified indemnifying
party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume
the defense of such claim or action, the indemnifying party shall not
be liable to the indemnified party under this Section 7 for any legal
or other expenses subsequently incurred by the indemnified party in
connection with the defense thereof other than reasonable costs of
investigation; provided, however, that any indemnified party shall have
the right to employ separate counsel in any such action and to
participate in the defense thereof but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless (i)
the employment thereof has been specifically authorized by the
indemnifying party in writing, (ii) such indemnified party shall have
been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to
those available to the indemnifying party and in the reasonable
judgment of such counsel it is advisable for such indemnified party to
employ separate counsel or (iii) the indemnifying party has failed to
assume the defense of such action in accordance with the terms hereof
and employ counsel reasonably satisfactory to the indemnified party, in
which case, if such indemnified party notifies the indemnifying party
in writing that it elects to employ separate counsel at the expense of
the indemnifying party, the indemnifying party shall not have the right
to assume the defense of such action on behalf of such indemnified
party, it being understood, however, that the indemnifying party shall
not, in connection with any one such action or separate but
substantially similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances, be liable
for the reasonable fees and expenses of more than one separate firm of
attorneys at any time for all such indemnified parties, which firm
shall be designated in writing by the Placement Agent, if the
indemnified parties under this Section 7 consist of any Placement Agent
Indemnified Party, by the Company if the indemnified parties under this
Section 7 consist of any Company Indemnified Parties and by the Selling
Shareholders if the indemnified parties under this Section 7 consist of
any Selling Shareholder Indemnified Parties. Each indemnified party, as
a condition of the indemnity agreements contained in Sections 7(a),
7(b) and 7(c) shall use all reasonable efforts to cooperate with the
indemnifying party in the defense of any such action or claim. No
indemnifying party shall
23
be liable for any settlement, compromise or consent to the entry of
judgment in connection with any such action effected without its
written consent (which consent shall not be unreasonably withheld), but
if settled with its written consent or if there be a final judgment for
the plaintiff in any such action (other than a judgment entered with
the consent of such indemnified party), the indemnifying party agrees
to indemnify and hold harmless any indemnified party from and against
any loss or liability by reason of such settlement or judgment.
(e) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
Section 7(a), 7(b) or 7(c), then each indemnifying party shall, in lieu
of indemnifying such indemnified party, contribute to the amount paid
or payable by such indemnified party as a result of such loss, claim,
damage or liability, or action in respect thereof, (i) in such
proportion as shall be appropriate to reflect the relative benefits
received by the Company or the Selling Shareholders on the one hand and
the Placement Agent on the other from the offering of the Stock or (ii)
if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the
relative fault of the Company or the Selling Shareholders on the one
hand and the Placement Agent on the other with respect to the
statements or omissions which resulted in such loss, claim, damage or
liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company
or the Selling Shareholders on the one hand and the Placement Agent on
the other with respect to such offering shall be deemed to be in the
same proportion as the total net proceeds from the offering of the
Stock purchased under this Agreement (before deducting expenses)
received by the Selling Shareholders bears to the total compensation
received by the Placement Agent with respect to the Stock purchased
under this Agreement. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by the Company or
the Selling Shareholders on the one hand or the Placement Agent on the
other, the intent of the parties and their relative knowledge, access
to information and opportunity to correct or prevent such untrue
statement or omission; provided that the parties hereto agree that the
written information furnished (x) to the Company or the Selling
Shareholders by the Placement Agent for use in the Prospectus
Supplement consists solely of the Placement Agent's Information and (y)
to the Company by each Selling Shareholder for use in the Prospectus
Supplement shall consist solely of such Selling Shareholder's
respective Selling Shareholders' Information. The Company, the Selling
Shareholders and the Placement Agent agree that it would not be just
and equitable if contributions pursuant to this Section 7(e) 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 loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section 7(e) shall be deemed to
include, for purposes of this Section 7(e), 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 7(e), (i) the Placement Agent shall not
be required to contribute any amount in excess of total compensation
received by such Placement Agent in accordance with Section 1(e) less
the amount of any damages which such Placement Agent has otherwise paid
or become liable to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission, (ii)
24
no Selling Shareholder shall be required to contribute any amount in
excess of the aggregate net proceeds, after deducting placement agent
fees, received by such Selling Shareholder from the sale of the Stock
sold by such Selling Shareholder hereunder less the amount of any
damages which such Selling Shareholder has otherwise paid or become
liable to pay by reason of any untrue or alleged untrue statement or
omission or alleged omission and (iii) the Selling Shareholders'
obligations in this Section 7(e) shall be several and not joint. No
person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent
misrepresentation.
Section 8. Termination. The obligations of the Placement Agent and the
Purchasers hereunder and under the Purchase Agreement may be terminated by the
Placement Agent, in its absolute discretion by notice given to the Company and
the Selling Shareholders prior to delivery (including electronic delivery) of
and payment for the Stock if, prior to that time, any of the events described in
Sections 6(k) or 6(n) have occurred or if the Purchasers shall decline to
purchase the Stock for any reason permitted under this Agreement or the Purchase
Agreement. The obligations of each Selling Shareholder and the authority of the
Placement Agent hereunder and under the Purchase Agreement shall automatically
be terminated if payment for the Stock is not received by such Selling
Shareholder on or prior to January 31, 2005.
Section 9. Reimbursement of Placement Agent's Expenses. If the sale of the Stock
provided for herein is not consummated because any condition to the obligations
of the Placement Agent and the Purchasers set forth in Section 6 hereof is not
satisfied, because of any termination pursuant to Section 8 hereof or because of
any refusal, inability or failure on the part of the Company or the Selling
Shareholders to perform any agreement herein or comply with any provision hereof
other than by reason of a default by the Placement Agent, the Company will
reimburse the Placement Agent upon demand for all out-of-pocket expenses
(including fees and disbursements of counsel and any expenses advanced by the
Placement Agent on the Company's or Selling Shareholders' behalf) that shall
have been incurred by the Placement Agent in connection with this Agreement and
the proposed purchase and sale of the Stock and, upon demand, the Company shall
pay the full amount thereof to the Placement Agent.
Section 10. Successors; Persons Entitled to Benefit of Agreement. This Agreement
shall inure to the benefit of and be binding upon the Placement Agent, the
Purchasers, the Company, the Selling Shareholders and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person other than the persons mentioned in the
preceding sentence 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 the representations, warranties, covenants, agreements and
indemnities of the Company and the Selling Shareholders contained in this
Agreement shall also be for the benefit of the Placement Agent Indemnified
Parties, and the indemnities of the Placement Agent shall also be for the
benefit of the Company Indemnified Parties and the Selling Shareholder
Indemnified Parties. It is understood that the Placement Agent's
responsibilities to the Company and the Selling Shareholders are solely
contractual in nature and the Placement Agent does not owe the Company, the
Selling Shareholders, or any other party, any fiduciary duty as a result of this
Agreement.
25
Section 11. Survival of Indemnities, Representations, Warranties, etc. The
respective indemnities, covenants, agreements, representations, warranties and
other statements of the Company, the Selling Shareholders and the Placement
Agent, as set forth in this Agreement or made by them respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation made by or on behalf of the Placement Agent, the Company, the
Selling Shareholders, the Purchasers or any person controlling any of them and
shall survive delivery of and payment for the Stock.
Section 12. Notices. All statements, requests, notices and agreements hereunder
shall be in writing, and:
(a) if to the Placement Agent, shall be delivered or sent by mail,
telex or facsimile transmission to ▇▇▇▇▇▇▇▇▇▇▇ & Co. Inc., ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇ (Fax:
▇▇▇-▇▇▇-▇▇▇▇), with a copy to: ▇▇▇▇▇ Raysman ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
LLP, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇
▇▇▇▇▇▇, Esq. (Fax: ▇▇▇-▇▇▇-▇▇▇▇).
(b) if to the Company, shall be delivered or sent by mail, telex or
facsimile transmission to I-trax, Inc., ▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Chief Executive Officer and
General Counsel (Fax: ▇▇▇-▇▇▇-▇▇▇▇), with a copy to: ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ & Ingersoll, LLP, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq. (Fax:
▇▇▇-▇▇▇-▇▇▇▇).
(c) if to any Selling Shareholder, shall be delivered or sent by mail,
telex or facsimile transmission to such Selling Shareholder at the
address set forth on Schedule II hereto and (i) in the case of Warburg,
▇▇▇▇▇▇ Ventures, L.P., with a copy to ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP, ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, Esq. (Fax: ▇▇▇-▇▇▇-▇▇▇▇); and (ii) in the case of CHD
Investors, LLC, with a copy to ▇▇▇▇, Weiss, Rifkind, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
LLP, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, Attention:
▇▇▇▇ ▇▇▇▇▇▇▇, Esq. (Fax: ▇▇▇-▇▇▇-▇▇▇▇).
Section 13. Definitions of Certain Terms. The terms which follow, when used in
this Agreement, shall have the meanings indicated.
"Business Day" shall mean any day other than a Saturday, a
Sunday, a legal holiday, a day on which banking institutions or trust
companies are authorized or obligated by law to close in New York City
or any day on which the American Stock Exchange is not open for
trading.
"Effective Date" shall mean each date and time that the
Registration Statement (and any post-effective amendment or amendments
thereto) became or becomes effective.
"Execution Time" shall mean the date and time that this
Agreement is executed and delivered by the parties hereto.
"Interference Proceeding" shall have the meaning set forth in
35 U.S.C. ss. 135.
26
"To the best of the Company's knowledge" and words of similar
import shall mean that which the Company knows or should have known
using the exercise of reasonable due diligence.
Section 14. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without giving effect to the
principles of conflicts of law that would require the application of the laws of
any other jurisdiction.
Section 15. Placement Agent's Information. The parties hereto acknowledge and
agree that, for all purposes of this Agreement, the Placement Agent's
Information consists solely of the statements concerning the Placement Agent
contained in the third paragraph under the heading "Plan of Distribution" in the
Prospectus Supplement.
Section 16. Partial Unenforceability. The invalidity or unenforceability of any
Section, paragraph or provision of this Agreement shall not affect the validity
or enforceability of any other Section, paragraph or provision hereof. If any
Section, paragraph or provision of this Agreement is for any reason determined
to be invalid or unenforceable, there shall be deemed to be made such minor
changes (and only such minor changes) as are necessary to make it valid and
enforceable.
Section 17. General. This Agreement constitutes the entire agreement of the
parties to this Agreement and supersedes all prior written or oral and all
contemporaneous oral agreements, understandings and negotiations with respect to
the subject matter hereof. In this Agreement, the masculine, feminine and neuter
genders and the singular and the plural include one another. The section
headings in this Agreement are for the convenience of the parties only and will
not affect the construction or interpretation of this Agreement. This Agreement
may be amended or modified, and the observance of any term of this Agreement may
be waived, only by a writing signed by the Company, the Selling Shareholders and
the Placement Agent.
Section 18. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
[Signature Pages Follow]
27
If the foregoing is in accordance with your understanding of the
agreement between the Company, the Selling Shareholders and the Placement Agent,
kindly indicate your acceptance in the space provided for that purpose below.
Very truly yours,
I-TRAX, INC.
By:______________________________
Name:
Title:
SELLING SHAREHOLDERS:
Warburg, ▇▇▇▇▇▇ Ventures, L.P.
By: Warburg, ▇▇▇▇▇▇ & Co., its General Partner
By: ______________________________
Name:
Title:
CHD Investors, LLC
By: International Managed Care, LLC, its Managing Member
By: Insurance Partners, L.P., its Managing Member
By: Insurance GenPar, L.P., its General Partner
By: Insurance GenPar MGP, L.P., its General Partner
By: Insurance GenPar MGP, Inc., its General Partner
By: ______________________________
Name:
Title:
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Accepted as of the date first above written:
▇▇▇▇▇▇▇▇▇▇▇ & CO. INC.
By: _______________________________
Name:
Title:
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Schedule I
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Names of Selling Shareholders
Name Number of Shares
---- ----------------
Warburg, ▇▇▇▇▇▇ Ventures, L.P. 3,674,870
CHD Investors, LLC 1,368,307
-------------------------
Total: 5,043,177
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Schedule II
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Addresses of Selling Shareholders
Warburg, ▇▇▇▇▇▇ Ventures, L.P.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇▇
CHD Investors, LLC
c/o Oak Hill Capital Management, Inc.
Park Avenue Tower
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇▇
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