BANC OF AMERICA SECURITIES LLC
UNDERWRITING AGREEMENT
Draft of August 8, 2000
5,700,000 SHARES
REGENERATION TECHNOLOGIES, INC.
Common Stock
Underwriting Agreement
dated August ___, 2000
TABLE OF CONTENTS
PAGE
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SECTION 1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE SELLING STOCKHOLDER.............................2
A. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.............................................................2
(a) COMPLIANCE WITH REGISTRATION REQUIREMENTS................................................................2
(b) OFFERING MATERIALS FURNISHED TO UNDERWRITERS.............................................................2
(c) DISTRIBUTION OF OFFERING MATERIAL BY THE COMPANY.........................................................3
(d) THE UNDERWRITING AGREEMENT...............................................................................3
(e) AUTHORIZATION OF THE COMMON SHARES.......................................................................3
(f) NO APPLICABLE REGISTRATION OR OTHER SIMILAR RIGHTS.......................................................3
(g) NO MATERIAL ADVERSE CHANGE...............................................................................3
(h) INDEPENDENT ACCOUNTANTS..................................................................................3
(i) PREPARATION OF THE FINANCIAL STATEMENTS..................................................................3
(j) INCORPORATION AND GOOD STANDING OF THE COMPANY AND ITS SUBSIDIARIES......................................4
(k) CAPITALIZATION AND OTHER CAPITAL STOCK MATTERS...........................................................4
(l) NASDAQ NATIONAL LISTING..................................................................................4
(m) NON-CONTRAVENTION OF EXISTING INSTRUMENTS; NO FURTHER AUTHORIZATIONS OR APPROVALS REQUIRED...............4
(n) COMPLIANCE WITH LAWS.....................................................................................5
(o) NO MATERIAL ACTIONS OR PROCEEDINGS.......................................................................5
(p) INTELLECTUAL PROPERTY RIGHTS.............................................................................6
(q) ALL NECESSARY PERMITS, ETC...............................................................................6
(r) TITLE TO PROPERTIES......................................................................................6
(s) TAX LAW COMPLIANCE.......................................................................................7
(t) COMPANY NOT AN "INVESTMENT COMPANY.......................................................................7
(u) INSURANCE................................................................................................7
(v) NO PRICE STABILIZATION OR MANIPULATION...................................................................7
(w) RELATED PARTY TRANSACTIONS...............................................................................7
(x) NO UNLAWFUL CONTRIBUTIONS OR OTHER PAYMENTS..............................................................7
(y) COMPANY'S ACCOUNTING SYSTEM..............................................................................7
(z) COMPLIANCE WITH ENVIRONMENTAL LAWS.......................................................................7
(aa) ERISA COMPLIANCE.........................................................................................8
(bb) LOCK-UP AGREEMENTS.......................................................................................9
B REPRESENTATIONS AND WARRANTIES OF THE SELLING STOCKHOLDER.................................................9
(a) THE UNDERWRITING AGREEMENT...............................................................................9
(b) THE CUSTODY AGREEMENT AND POWER OF ATTORNEY..............................................................9
(c) TITLE TO COMMON SHARES TO BE SOLD; ALL AUTHORIZATIONS OBTAINED...........................................9
(d) DELIVERY OF THE COMMON SHARES TO BE SOLD................................................................10
(e) NON-CONTRAVENTION; NO FURTHER AUTHORIZATIONS OR APPROVALS REQUIRED......................................10
(f) NO REGISTRATION OR OTHER SIMILAR RIGHTS.................................................................10
(g) NO FURTHER CONSENTS, ETC................................................................................10
(h) DISCLOSURE MADE BY THE SELLING STOCKHOLDER IN THE PROSPECTUS............................................10
(i) NO PRICE STABILIZATION OR MANIPULATION..................................................................10
SECTION 2. PURCHASE, SALE AND DELIVERY OF THE COMMON SHARES..................................................11
(a) THE FIRM COMMON SHARES..................................................................................11
(b) THE FIRST CLOSING DATE..................................................................................11
(c) THE OPTIONAL COMMON SHARES; THE SECOND CLOSING DATE.....................................................11
(d) PUBLIC OFFERING OF THE COMMON SHARES....................................................................11
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(e) PAYMENT FOR THE COMMON SHARES...........................................................................12
(f) DELIVERY OF THE COMMON SHARES...........................................................................12
(g) DELIVERY OF PROSPECTUS TO THE UNDERWRITERS..............................................................12
SECTION 3. ADDITIONAL COVENANTS..............................................................................12
A. ADDITIONAL COVENANTS OF THE COMPANY......................................................................12
(a) REPRESENTATIVES'REVIEW OF PROPOSED AMENDMENTS AND SUPPLEMENTS...........................................13
(b) SECURITIES ACT COMPLIANCE...............................................................................13
(c) AMENDMENTS AND SUPPLEMENTS TO THE PROSPECTUS AND OTHER SECURITIES ACT MATTERS...........................13
(d) COPIES OF ANY AMENDMENTS AND SUPPLEMENTS TO THE PROSPECTUS..............................................13
(e) BLUE SKY COMPLIANCE.....................................................................................13
(f) USE OF PROCEEDS.........................................................................................14
(g) TRANSFER AGENT..........................................................................................14
(h) QUOTATION...............................................................................................14
(i) EARNINGS STATEMENT......................................................................................14
(j) PERIODIC REPORTING OBLIGATIONS..........................................................................14
(k) AGREEMENT NOT TO OFFER OR SELL ADDITIONAL SECURITIES....................................................14
(l) FUTURE REPORTS TO THE REPRESENTATIVES...................................................................15
B. COVENANT OF THE SELLING STOCKHOLDER......................................................................15
SECTION 4. PAYMENT OF EXPENSES...............................................................................15
SECTION 5. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS.................................................16
(a) ACCOUNTANTS'COMFORT LETTER..............................................................................16
(b) COMPLIANCE WITH REGISTRATION REQUIREMENTS; NO STOP ORDER; NO OBJECTION FROM NASD........................16
(c) NO MATERIAL ADVERSE CHANGE..............................................................................17
(d) OPINION OF COUNSEL FOR THE COMPANY......................................................................17
(e) OPINION OF INTELLECTUAL PROPERTY COUNSEL FOR THE COMPANY................................................17
(f) OPINION OF REGULATORY COUNSEL FOR THE COMPANY...........................................................17
(g) OPINION OF COUNSEL FOR THE UNDERWRITERS.................................................................17
(h) OFFICERS'CERTIFICATE....................................................................................17
(i) SECRETARY'S CERTIFICATE.................................................................................18
(j) BRING-DOWN COMFORT LETTER...............................................................................18
(k) LOCK-UP AGREEMENT FROM CERTAIN SECURITYHOLDERS OF THE COMPANY...........................................18
(l) OPINION OF COUNSEL FOR THE SELLING STOCKHOLDER..........................................................18
(m) SELLING STOCKHOLDER'S CERTIFICATE.......................................................................18
(n) SELLING STOCKHOLDER'S DOCUMENTS.........................................................................19
(o) ADDITIONAL DOCUMENTS....................................................................................19
SECTION 6. REIMBURSEMENT OF UNDERWRITERS'EXPENSES............................................................19
SECTION 7. EFFECTIVENESS OF THIS AGREEMENT...................................................................19
SECTION 8. INDEMNIFICATION...................................................................................20
(a) INDEMNIFICATION OF THE UNDERWRITERS BY THE COMPANY......................................................20
(b) INDEMNIFICATION OF THE UNDERWRITERS BY THE SELLING STOCKHOLDER..........................................21
(c) INDEMNIFICATION OF THE COMPANY, ITS DIRECTORS, OFFICERS AND THE SELLING STOCKHOLDER.....................22
(d) NOTIFICATIONS AND OTHER INDEMNIFICATION PROCEDURES......................................................22
(e) SETTLEMENTS.............................................................................................23
(f) LIMITATION ON LIABILITY OF THE SELLING STOCKHOLDER......................................................23
SECTION 9. CONTRIBUTION......................................................................................23
SECTION 10.DEFAULT OF ONE OR MORE OF THE SEVERAL UNDERWRITERS....................................................25
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SECTION 11.TERMINATION OF THIS AGREEMENT.........................................................................25
SECTION 12.REPRESENTATIONS AND INDEMNITIES TO SURVIVE DELIVERY...................................................26
SECTION 13.DEFAULT BY THE COMPANY................................................................................26
SECTION 14.NOTICES...............................................................................................26
SECTION 15.SUCCESSORS............................................................................................27
SECTION 16.PARTIAL UNENFORCEABILITY..............................................................................27
SECTION 17.GOVERNING LAW PROVISIONS..............................................................................27
SECTION 18. FAILURE OF THE SELLING STOCKHOLDER TO SELL AND DELIVER COMMON SHARES.................................28
SECTION 19.GENERAL PROVISIONS....................................................................................28
SCHEDULES
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SCHEDULE A SCHEDULE OF UNDERWRITERS
EXHIBITS
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EXHIBIT A FORM OF OPINION OF COUNSEL FOR THE COMPANY
EXHIBIT A-1 FORM OF OPINION OF INTELLECTUAL PROPERTY COUNSEL FOR THE COMPANY
EXHIBIT A-2 FORM OF OPINION OF REGULATORY COUNSEL FOR THE COMPANY
EXHIBIT A-3 FORM OF OPINION OF COUNSEL FOR THE SELLING STOCKHOLDER
EXHIBIT B FORM OF LOCK-UP AGREEMENT
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UNDERWRITING AGREEMENT
August 9, ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ SECURITIES LLC
▇▇▇▇▇▇ BROTHERS INC.
▇▇▇▇▇▇▇▇ INC.
As Representatives of the several Underwriters
c/o BANC OF AMERICA SECURITIES LLC
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
INTRODUCTORY. Regeneration Technologies, Inc., a Delaware
corporation (the "Company"), proposes to issue and sell to the several
underwriters named in SCHEDULE A (the "Underwriters") an aggregate of
3,800,000 shares of its Common Stock, par value $.001 per share (the "Common
Stock"); and the University of Florida Research Foundation (the "Selling
Stockholder") proposes to sell to the Underwriters an aggregate of 1,900,000
shares of Common Stock. The 3,800,000 shares of Common Stock to be sold by
the Company and the 1,900,000 shares of Common Stock to be sold by the
Selling Stockholder are collectively called the "Firm Common Shares." In
addition, the Company has granted to the Underwriters an option to purchase
up to an additional 855,000 shares (the "Optional Common Shares") of Common
Stock, as provided in Section 2. The Firm Common Shares and, if and to the
extent such option is exercised, the Optional Common Shares are collectively
called the "Common Shares." Banc of America Securities LLC ("BAS"), ▇▇▇▇▇▇
Brothers Inc. and ▇▇▇▇▇▇▇▇ Inc. have agreed to act as representatives of the
several Underwriters (in such capacity, the "Representatives") in connection
with the offering and sale of the Common Shares.
The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") a registration statement on Form S-1 (File No.
333-35756), which contains a form of prospectus to be used in connection with
the public offering and sale of the Common Shares. Such registration
statement, as amended, including the financial statements, exhibits and
schedules thereto, in the form in which it was declared effective by the
Commission under the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder (collectively, the "Securities Act"),
including any information deemed to be a part thereof at the time of
effectiveness pursuant to Rule 430A or Rule 434 under the Securities Act, is
called the "Registration Statement." Any registration statement filed by the
Company pursuant to Rule 462(b) under the Securities Act is called the "Rule
462(b) Registration Statement," and from and after the date and time of
filing of the Rule 462(b) Registration Statement the term "Registration
Statement" shall include the Rule 462(b) Registration Statement. Such
prospectus, in the form first used by the Underwriters to confirm sales of
the Common Shares, is called the "Prospectus"; PROVIDED, HOWEVER, if the
Company has, with the consent of BAS, elected to rely upon Rule 434 under the
Securities Act, the term "Prospectus" shall mean the Company's prospectus
subject to completion (each, a "preliminary prospectus") dated July 19, 2000
(such preliminary prospectus is called the "Rule 434 preliminary
prospectus"), together with the applicable term sheet (the "Term Sheet")
prepared and filed by the Company with the Commission under Rules 434 and
424(b) under the Securities Act and all references in this Agreement to the
date of the Prospectus shall mean the date of the Term Sheet. All references
in this Agreement to the Registration Statement, the Rule 462(b) Registration
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Statement, a preliminary prospectus, the Prospectus or the Term Sheet, or any
amendments or supplements to any of the foregoing, shall include any copy
thereof filed with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval System ("▇▇▇▇▇").
The Company and the Selling Stockholder hereby confirm
their respective agreements with the Underwriters as follows:
SECTION 1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND THE
SELLING STOCKHOLDER.
A. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby
represents, warrants and covenants to each Underwriter as follows:
(a) COMPLIANCE WITH REGISTRATION REQUIREMENTS. The Registration
Statement and any Rule 462(b) Registration Statement have been declared
effective by the Commission under the Securities Act. The Company has
complied to the Commission's satisfaction with all requests of the Commission
for additional or supplemental information. No stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b) Registration
Statement is in effect and no proceedings for such purpose have been
instituted or are pending or, to the best knowledge of the Company, are
contemplated or threatened by the Commission.
Each preliminary prospectus and the Prospectus when filed complied
in all material respects with the Securities Act and, if filed by electronic
transmission pursuant to ▇▇▇▇▇ (except as may be permitted by Regulation S-T
under the Securities Act), was identical to the copy thereof delivered to the
Underwriters for use in connection with the offer and sale of the Common
Shares. Each of the Registration Statement, any Rule 462(b) Registration
Statement and any post-effective amendment thereto, at the time it became
effective and at all subsequent times, complied and will comply in all
material respects with the Securities Act and did not and 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 Prospectus, and any amendment or supplement thereto as of its
date and at all subsequent times, did not and will not contain any untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading. The representations and warranties set
forth in the two immediately preceding sentences do not apply to statements
in or omissions from the Registration Statement, any Rule 462(b) Registration
Statement, or any post-effective amendment thereto, or the Prospectus, or any
amendments or supplements thereto, made in reliance upon and in conformity
with information relating to any Underwriter furnished to the Company in
writing by the Representative expressly for use therein. There are no
contracts or other documents required to be described in the Prospectus or to
be filed as exhibits to the Registration Statement which have not been
described or filed as required.
(b) OFFERING MATERIALS FURNISHED TO UNDERWRITERS. The Company has
delivered to BAS on behalf of the Representatives and counsel for the
Underwriters, without charge, one complete manually signed copy 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 preliminary prospectuses and the Prospectus, as
amended or supplemented, in such quantities and at such places as the
Representatives have reasonably requested for each of the Underwriters. The
copies of the Registration Statement and each amendment thereto furnished to
the Underwriters are identical to the electronically transmitted copies
thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the extent
permitted by Regulation S-T.
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(c) DISTRIBUTION OF OFFERING MATERIAL BY THE COMPANY. The Company
has not distributed and will not distribute, prior to the later of the Second
Closing Date (as defined below) and the completion of the Underwriters'
distribution of the Common Shares, any offering material in connection with
the offering and sale of the Common Shares other than a preliminary
prospectus, the Prospectus or the Registration Statement.
(d) THE UNDERWRITING AGREEMENT. This Agreement has been duly
authorized, executed and delivered by, and is a valid and binding agreement
of, the Company, enforceable in accordance with its terms, except as rights
to indemnification hereunder may be limited by applicable law and except as
the enforcement hereof 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.
(e) AUTHORIZATION OF THE COMMON SHARES. The Common Shares to be
purchased by the Underwriters from the Company have been duly authorized for
issuance and sale pursuant to this Agreement and, when issued and delivered
by the Company pursuant to this Agreement, will be validly issued, fully paid
and nonassessable. The Common Stock conforms to all statements relating
thereto contained in the Prospectus and such description conforms in all
material respects to the rights set forth in the instruments defining the
same; no holder of the Common Shares will be subject to personal liability by
reason of being such a holder; and the issuance of the Common Shares is not
subject to any preemptive rights, rights of first refusal or other similar
rights which have not been effectively waived to subscribe for or purchase
securities of the Company.
(f) NO APPLICABLE REGISTRATION OR OTHER SIMILAR RIGHTS. There are no
persons with registration or other similar rights to have any equity or debt
securities registered for sale under the Registration Statement or included
in the offering contemplated by this Agreement, except for such rights as
have been duly waived.
(g) NO MATERIAL ADVERSE CHANGE. Except as otherwise disclosed in the
Prospectus, subsequent to the respective dates as of which information is
given in the Prospectus: (i) there has been no material adverse change, or
any development that could reasonably be expected to result in a material
adverse change, in the condition, financial or otherwise, or in the earnings,
business, operations or prospects, whether or not arising from transactions
in the ordinary course of business, of the Company and its subsidiaries,
considered as one entity (any such change is called a "Material Adverse
Change"); (ii) the Company and its subsidiaries, considered as one entity,
have not incurred any material liability or obligation, indirect, direct or
contingent, not in the ordinary course of business nor entered into any
material transaction or agreement not in the ordinary course of business; and
(iii) there has been no dividend or distribution of any kind declared, paid
or made by the Company or, except for dividends paid to the Company or other
subsidiaries, any of its subsidiaries on any class of capital stock or
repurchase or redemption by the Company or any of its subsidiaries of any
class of capital stock.
(h) INDEPENDENT ACCOUNTANTS. Deloitte & Touche LLP, who have
expressed their opinion with respect to the financial statements (which term
as used in this Agreement includes the related notes thereto) and supporting
schedules filed with the Commission as a part of the Registration Statement
and included in the Prospectus, are independent public or certified public
accountants as required by the Securities Act.
(i) PREPARATION OF THE FINANCIAL STATEMENTS. The financial
statements filed with the Commission as a part of the Registration Statement
and included in the Prospectus present fairly the consolidated financial
position of the Company and its subsidiaries as of and at the dates indicated
and the results of their operations and cash flows for the periods specified.
The supporting schedules included in the Registration Statement present
fairly the information required to be stated therein. Such financial
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statements and supporting schedules have been prepared in conformity with
generally accepted accounting principles as applied in the United States
(("GAAP") applied on a consistent basis throughout the periods involved,
except as may be expressly stated in the related notes thereto, and except
that the interim financial statements do not contain all of the notes that
would be required by GAAP if such statements were audited and are subject to
normal year-end adjustments, which are not expected to be material. No other
financial statements or supporting schedules are required to be included in
the Registration Statement. The financial data set forth in the Prospectus
under the captions "Prospectus Summary--Summary Consolidated Financial Data",
"Selected Consolidated Financial Data", "Capitalization" and "Management's
Discussion and Analysis of Financial Condition and Results of
Operations-Results of Operations" fairly present the information set forth
therein on a basis consistent with that of the audited financial statements
contained in the Registration Statement.
(j) INCORPORATION AND GOOD STANDING OF THE COMPANY AND ITS
SUBSIDIARIES. Each of the Company and its subsidiaries has been duly
incorporated and is validly existing as a corporation in good standing under
the laws of the jurisdiction of its incorporation and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus and, in the case of the Company, to
enter into and perform its obligations under this Agreement. Each of the
Company and each subsidiary is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except for such jurisdictions (other
than the State of Florida) where the failure to so qualify or to be in good
standing would not, individually or in the aggregate, result in a Material
Adverse Change. All of the issued and outstanding capital stock of each
subsidiary has been duly authorized and validly issued, is fully paid and
nonassessable and is owned by the Company, directly or through subsidiaries,
free and clear of any security interest, mortgage, pledge, lien, encumbrance
or claim. The Company does not own or control, directly or indirectly, any
corporation, association or other entity other than the subsidiaries listed
in Exhibit 21 to the Registration Statement.
(k) CAPITALIZATION AND OTHER CAPITAL STOCK MATTERS. The authorized,
issued and outstanding capital stock of the Company is as set forth in the
Prospectus under the caption "Capitalization" (other than for subsequent
issuances, if any, pursuant to employee benefit plans described in the
Prospectus or upon exercise of outstanding options described in the
Prospectus). The Common Stock (including the Common Shares) conforms in all
material respects to the description thereof contained in the Prospectus. All
of the issued and outstanding shares of Common Stock (including the shares of
Common Stock owned by the Selling Stockholder) have been duly authorized and
validly issued, are fully paid and nonassessable and have been issued in
compliance with federal and state securities laws. None of the outstanding
shares of Common Stock were issued in violation of any preemptive rights,
rights of first refusal or other similar rights to subscribe for or purchase
securities of the Company. 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
other than those disclosed in the Prospectus. The description of the
Company's stock option, stock bonus and other stock plans or arrangements,
and the options or other rights granted thereunder, set forth n the
Prospectus accurately and fairly presents the information required to be
shown with respect to such plans, arrangements, options and rights.
(l) NASDAQ NATIONAL MARKET LISTING. The Common Shares have been
approved for listing on the Nasdaq National Market, subject only to official
notice of issuance.
(m) NON-CONTRAVENTION OF EXISTING INSTRUMENTS; NO FURTHER
AUTHORIZATIONS OR APPROVALS REQUIRED. Neither the Company nor any of its
subsidiaries is in violation of its charter or by-laws or is in default (or,
with the giving of notice or lapse of time, would be in default) ("Default")
under any
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indenture, mortgage, loan or credit agreement, note, contract, franchise,
lease or other instrument to which the Company or any of its subsidiaries is
a party or by which it or any of them may be bound (including, without
limitation, the Company's revolving bank line of credit), or to which any of
the property or assets of the Company or any of its subsidiaries is subject
(each, an "Existing Instrument"), except for such Defaults as would not,
individually or in the aggregate, result in a Material Adverse Change. The
Company's execution, delivery and performance of this Agreement and
consummation of the transactions contemplated hereby and by the Prospectus
(including the issuance and sale of the Common Shares and the use of proceeds
from the sale of the Common Shares as described in the Prospectus under the
caption "Use of Proceeds") and compliance by the Company with its obligations
hereunder (i) have been duly authorized by all necessary corporate action and
will not result in any violation of the provisions of the charter or by-laws
of the Company or any subsidiary, (ii) will not conflict with or constitute a
breach of, or Default or Repayment Event (as defined below) under, or result
in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any of its subsidiaries pursuant to, or
require the consent of any other party to, any Existing Instrument, except
for such conflicts, breaches, Defaults, Repayment Events, liens, charges or
encumbrances as would not, individually or in the aggregate, result in a
Material Adverse Change and (iii) will not result in any violation of any
law, administrative regulation or administrative or court decree applicable
to the Company or any subsidiary. No consent, approval, authorization or
other order of, or registration or filing with, any court or other
governmental or regulatory authority or agency, is required for the Company's
execution, delivery and performance of this Agreement and consummation of the
transactions contemplated hereby and by the Prospectus (including the
offering, issuance and sale of the Common Shares), except such as have been
obtained or made by the Company and are in full force and effect under the
Securities Act, applicable state securities or blue sky laws and from the
National Association of Securities Dealers, Inc. (the "NASD"). As used
herein, a "Repayment Event" means any event or condition which gives the
holder of any note, debenture or other evidence of indebtedness (or any
person acting on such holder's behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such indebtedness by the
Company or any of its subsidiaries.
(n) COMPLIANCE WITH LAWS. The Company and each of its subsidiaries
are conducting their business in compliance with all the local, state,
federal, and foreign laws, rules and regulations of the jurisdictions in
which each of the Company and its subsidiaries is conducting business, except
where failure to be so in compliance, singly or in the aggregate, would not
result in a Material Adverse Change.
(o) NO MATERIAL ACTIONS OR PROCEEDINGS. Except as otherwise
disclosed in the Prospectus, there are no legal or governmental actions,
suits or proceedings pending or, to the best of the Company's knowledge,
there are no inquiries or investigations pending or threatened, in each case
(i) against or affecting the Company or any of its subsidiaries, (ii) which
has as the subject thereof any officer or director of, or property owned or
leased by, the Company or any of its subsidiaries or (iii) relating to
environmental or discrimination matters, where in any such case (A) there is
a reasonable possibility that such action, suit or proceeding would be
determined adversely to the Company or such subsidiary and (B) any such
action, suit or proceeding, if so determined adversely, would reasonably be
expected to result in a Material Adverse Change or adversely affect the
consummation of the transactions contemplated by this Agreement. No material
labor dispute with the employees of the Company or any of its subsidiaries,
or to the best of the Company's knowledge, with the employees of any
principal supplier, manufacturer, customer or contractor of the Company,
exists or, to the best of the Company's knowledge, is threatened or imminent.
The aggregate outcome of all pending legal or governmental proceedings to
which the Company or any of its subsidiaries is a party or of which any of
their respective property or assets is the subject which are not described in
the Prospectus, including ordinary routine litigation incidental to the
business, would not reasonably be expected to result, individually or in the
aggregate, in a Material Adverse Change.
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(p) INTELLECTUAL PROPERTY RIGHTS. The Company and its subsidiaries
own or possess sufficient trademarks, trade names, service marks, patents,
patent rights, copyrights, licenses, approvals, inventions, know-how
(including trade secrets and other unpatented and/or unpatentable proprietary
or confidential information, systems or procedures) and other similar rights
and intellectual property (collectively, "Intellectual Property Rights")
necessary to conduct their businesses in all material respects as it is now
conducted; and the expected expiration of any of such Intellectual Property
Rights would not result in a Material Adverse Change. Neither the Company nor
any of its subsidiaries has received any notice of infringement or conflict
with asserted rights of others with respect to any Intellectual Property
Rights or of any facts or circumstances which would render any Intellectual
Property Rights invalid or inadequate to protect the interests of the Company
or any of its subsidiaries therein, and, which infringement or conflict, if
the subject of an unfavorable decision, would result in a Material Adverse
Change. The Company has good and marketable title to the patents and patent
applications referenced in the Prospectus. The Company and its subsidiaries
have entered into valid and binding confidentiality, non-disclosure and
assignment of inventions agreements with all current and former employees,
consultants, vendors and other third parties with access to the Company's or
its subsidiaries' Intellectual Property Rights. There is no material
unauthorized use, disclosure, infringement or misappropriation of any
Intellectual Property Rights of the Company or any of its subsidiaries, any
trade secret material to the Company or any of its subsidiaries, or any
Intellectual Property Rights of any third party to the extent licensed by or
through the Company or any of its subsidiaries, by any third party, including
any employee, former employee, consultant or vendor of the Company or any of
its subsidiaries.
(q) ALL NECESSARY PERMITS, ETC. The Company and each subsidiary
possess such valid and current certificates, licenses, authorizations or
permits (collectively, "Governmental Licenses") issued by the appropriate
state, federal or foreign regulatory agencies or bodies necessary to conduct
their respective businesses (other than any the absence of which would not,
singly or in the aggregate, reasonably be expected to result in a Material
Adverse Change); the Company and its subsidiaries are in compliance with the
terms and conditions of all such Governmental Licenses, except where the
failure to so comply which would not, singly or in the aggregate, reasonably
be expected to result in a Material Adverse Change; all of the Governmental
Licenses are valid and in full force and effect, except where the invalidity
of such Governmental Licenses or the failure of such Governmental Licenses to
be in full force and effect would not reasonably be expected to result in a
Material Adverse Change; and neither the Company nor any subsidiary has
received any notice, or is otherwise aware, of proceedings relating to the
revocation or modification of, or non-compliance with, any such Governmental
License which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, could result in a Material Adverse Change.
(r) TITLE TO PROPERTIES. The Company and each of its subsidiaries
has good and marketable title to all the properties and assets reflected as
owned in the financial statements referred to in Section 1(i) above (or
elsewhere in the Prospectus), in each case free and clear of any security
interests, mortgages, liens, encumbrances, equities, claims and other
defects, except such as are described in reasonable detail in the Prospectus
or do not materially and adversely affect the value of such property and do
not materially interfere with the use made or proposed to be made of such
property by the Company or such subsidiary. The real property, improvements,
equipment and personal property held under lease by the Company or any
subsidiary are held under valid and enforceable leases, with such exceptions
as are not material to the Company or its subsidiaries, and neither the
Company nor any of its subsidiaries has any notice of any claim of any sort
that has been asserted by anyone adverse to the rights of the Company or any
of its subsidiaries under any of the leases or subleases referred to above,
or affecting or questioning the rights of the Company or such subsidiary to
the continued possession of the leased or subleased premises under any such
lease or sublease, except for such notices or claims as would not reasonably
be expected to result in a Material Adverse Change.
6
(s) TAX LAW COMPLIANCE. The Company and its subsidiaries have filed
all necessary federal, state and foreign income and franchise tax returns or
have properly requested extensions thereof and have paid all taxes required
to be paid by any of them and, if due and payable, any related or similar
assessment, fine or penalty levied against any of them. The Company has made
adequate charges, accruals and reserves in the applicable financial
statements referred to in Section 1(A)(i) above in respect of all federal,
state and foreign income and franchise taxes for all periods as to which the
tax liability of the Company or any of its subsidiaries has not been finally
determined.
(t) COMPANY NOT AN "INVESTMENT COMPANY." The Company has been
advised of the rules and requirements under the Investment Company Act of
1940, as amended (the "Investment Company Act"). The Company is not, and
after receipt of payment for the Common Shares will not be, an "investment
company" within the meaning of Investment Company Act and will conduct its
business in a manner so that it will not become subject to the Investment
Company Act.
(u) INSURANCE. Each of the Company and its subsidiaries are insured
by recognized, financially sound and reputable institutions with policies in
such amounts and with such deductibles and covering such risks as are
generally deemed adequate and customary for their businesses including, but
not limited to, policies covering real and personal property owned or leased
by the Company and its subsidiaries against theft, damage, destruction, acts
of vandalism and earthquakes. The Company has no reason to believe that it or
any subsidiary will not be able (i) to renew its existing insurance coverage
as and when such policies expire or (ii) to obtain comparable coverage from
similar institutions as may be necessary or appropriate to conduct its
business as now conducted and at a cost that would not result in a Material
Adverse Change. Neither of the Company nor any subsidiary has been denied any
insurance coverage which it has sought or for which it has applied.
(v) NO PRICE STABILIZATION OR MANIPULATION. The Company has not
taken and will not take, directly or indirectly, any action designed to or
that might be reasonably expected to cause or result in stabilization or
manipulation of the price of the Common Stock to facilitate the sale or
resale of the Common Shares.
(w) RELATED PARTY TRANSACTIONS. There are no business relationships
or related-party transactions involving the Company or any subsidiary or any
other person required to be described in the Prospectus which have not been
described as required.
(x) NO UNLAWFUL CONTRIBUTIONS OR OTHER PAYMENTS. Neither the Company
nor any of its subsidiaries nor, to the best of the Company's knowledge, any
employee or agent of the Company or any subsidiary, has made any contribution
or other payment to any official of, or candidate for, any federal, state or
foreign office in violation of any law or of the character required to be
disclosed in the Prospectus.
(y) COMPANY'S ACCOUNTING SYSTEM. The Company maintains a system of
accounting controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles as applied in the United States and to maintain
accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(z) COMPLIANCE WITH ENVIRONMENTAL LAWS. Except as would not,
individually or in the aggregate, result in a Material Adverse Change (i)
neither the Company nor any of its subsidiaries is in
7
violation of any federal, state, local or foreign law or regulation relating
to pollution or protection of human health or the environment (including,
without limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including without limitation, laws and
regulations relating to emissions, discharges, releases or threatened
releases of chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum and petroleum products (collectively,
"Hazardous Materials"), or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Hazardous Materials (collectively, "Environmental Laws"), which violation
includes, but is not limited to, noncompliance with any permits or other
governmental authorizations required for the operation of the business of the
Company or its subsidiaries under applicable Environmental Laws, or
noncompliance with the terms and conditions thereof, nor has the Company or
any of its subsidiaries received any written communication, whether from a
governmental authority, citizens group, employee or otherwise, that alleges
that the Company or any of its subsidiaries is in violation of any
Environmental Law; (ii) there is no claim, action or cause of action filed
with a court or governmental authority, no investigation with respect to
which the Company has received written notice, and no written notice by any
person or entity alleging potential liability for investigatory costs,
cleanup costs, governmental responses costs, natural resources damages,
property damages, personal injuries, attorneys' fees or penalties arising out
of, based on or resulting from the presence, or release into the environment,
of any Hazardous Materials at any location owned, leased or operated by the
Company or any of its subsidiaries, now or in the past (collectively,
"Environmental Claims"), pending or, to the best of the Company's knowledge,
threatened against the Company or any of its subsidiaries or any person or
entity whose liability for any Environmental Claim the Company or any of its
subsidiaries has retained or assumed either contractually or by operation of
law; (iii) the Company and its subsidiaries have all permits, authorizations
and approvals required under any applicable Environmental Laws and are each
in compliance with their requirements; and (iv) to the best of the Company's
knowledge, there are no past or present actions, activities, circumstances,
conditions, events or incidents, including, without limitation, the release,
emission, discharge, presence or disposal of any Hazardous Materials, that
reasonably could result in a violation of any Environmental Law or form the
basis of a potential Environmental Claim against the Company or any of its
subsidiaries or against any person or entity whose liability for any
Environmental Claim the Company or any of its subsidiaries has retained or
assumed either contractually or by operation of law.
(aa) ERISA COMPLIANCE. The Company and its subsidiaries and any
"employee benefit plan" (as defined under the Employee Retirement Income
Security Act of 1974, as amended, and the regulations and published
interpretations thereunder (collectively, "ERISA")) established or maintained
by the Company, its subsidiaries or their "ERISA Affiliates" (as defined
below) are in compliance in all material respects with ERISA. "ERISA
Affiliate" means, with respect to the Company or a subsidiary, any member of
any group of organizations described in Sections 414(b),(c),(m) or (o) of the
Internal Revenue Code of 1986, as amended, and the regulations and published
interpretations thereunder (the "Code") of which the Company or such
subsidiary is a member. No "reportable event" (as defined under ERISA) has
occurred or is reasonably expected to occur with respect to any "employee
benefit plan" established or maintained by the Company, its subsidiaries or
any of their ERISA Affiliates. No "employee benefit plan" established or
maintained by the Company, its subsidiaries or any of their ERISA Affiliates,
if such "employee benefit plan" were terminated, would have any "amount of
unfunded benefit liabilities" (as defined under ERISA). Neither the Company,
its subsidiaries nor any of their ERISA Affiliates has incurred or reasonably
expects to incur any liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any "employee benefit plan" or (ii)
Sections 412, 4971, 4975 or 4980B of the Code. Each "employee benefit plan"
established or maintained by the Company, its subsidiaries or any of their
ERISA Affiliates that is intended to be qualified under Section 401(a) of the
Code is so qualified and nothing has occurred, whether by action or failure
to act, which would cause the loss of such qualification.
8
(bb) LOCK-UP AGREEMENTS. The Company has caused each of its
directors, officers and substantially all of the beneficial owners of its
Common Stock (as defined and determined according to Rule 13d-3 under the
Exchange Act, except that a one hundred eighty day period shall be used
rather than the sixty day period set forth therein) to furnish to you, on or
prior to the date of this agreement, a letter or letters, substantially in
the form of EXHIBIT B hereto (the "Lock-Up Agreement"), pursuant to which
each such person shall have agreed that during a period of one hundred and
eighty (180) days after the first date any of the Common Shares is released
by the Underwriters for sale to the public, such person will not, without the
prior written consent of BAS, (i) directly or indirectly, offer, pledge,
sell, contract to sell, sell any option or contract to purchase, purchase any
option or contract to sell, grant any option, right or warrant to purchase or
otherwise transfer or dispose of any share of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock or file or
cause to be filed any registration statement under the Securities Act with
respect to any of the foregoing, or (ii) enter into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Common Stock,
whether any such swap or transaction described in clause (i) or (ii) above is
to be settled by delivery of Common Stock or such other securities, in cash
or otherwise and such agreements are in full force and effect.
Any certificate signed by an officer of the Company and delivered to
the Representatives or to counsel for the Underwriters shall be deemed to be
a representation and warranty by the Company to each Underwriter as to the
matters covered thereby.
B. REPRESENTATIONS AND WARRANTIES OF THE SELLING
STOCKHOLDER. The Selling Stockholder represents, warrants and covenants to
each Underwriter as follows:
(a) THE UNDERWRITING AGREEMENT. This Agreement has been duly
authorized, executed and delivered by the Selling Stockholder and is a valid
and binding agreement of the Selling Stockholder, enforceable in accordance
with its terms, except as rights to indemnification hereunder may be limited
by applicable law and except as the enforcement hereof 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.
(b) THE CUSTODY AGREEMENT AND POWER OF ATTORNEY. Each of the (i)
Custody Agreement signed by the Selling Stockholder and the Company, as
custodian (the "Custodian"), relating to the deposit of the Common Shares to
be sold by the Selling Stockholder (the "Custody Agreement") and (ii) Power
of Attorney appointing certain individuals named therein as the Selling
Stockholder's attorneys-in-fact (each, an "Attorney-in-Fact") to the extent
set forth therein relating to the transactions contemplated hereby and by the
Prospectus (the "Power of Attorney"), of such Selling Stockholder has been
duly executed and delivered by the Selling Stockholder and is a valid and
binding agreement of the Selling Stockholder, enforceable in accordance with
its terms, except as rights to indemnification thereunder may be limited by
applicable law and except as the enforcement 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.
(c) TITLE TO COMMON SHARES TO BE SOLD; ALL AUTHORIZATIONS OBTAINED.
The Selling Stockholder has, and on the First Closing Date will have good and
valid title to all of the Common Shares which may be sold by the Selling
Stockholder pursuant to this Agreement on such date and the legal right and
power, and all authorizations and approvals required by law and under its
charter or by-laws or other organizational documents to enter into this
Agreement, the Custody Agreement and the Power of Attorney, to sell, transfer
and deliver all of the Common Shares which may be sold by the Selling
Stockholder pursuant to this Agreement and to comply with its other
obligations hereunder and thereunder.
9
(d) DELIVERY OF THE COMMON SHARES TO BE SOLD. Delivery of the Common
Shares which are sold by the Selling Stockholder pursuant to this Agreement
will pass good and valid title to such Common Shares, free and clear of any
security interest, mortgage, pledge, lien, encumbrance or other claim.
(e) NON-CONTRAVENTION; NO FURTHER AUTHORIZATIONS OR APPROVALS
REQUIRED. The execution and delivery by the Selling Stockholder of, and the
performance by the Selling Stockholder of its obligations under, this
Agreement, the Custody Agreement and the Power of Attorney will not
contravene or conflict with, result in a breach of, or constitute a Default
under, or require the consent of any other party to, the charter or by-laws,
or other organizational documents of the Selling Stockholder or any other
agreement or instrument to which the Selling Stockholder is a party or by
which it is bound or under which it is entitled to any right or benefit, any
provision of applicable law or any judgment, order, decree or regulation
applicable to the Selling Stockholder of any court, regulatory body,
administrative agency, governmental body or arbitrator having jurisdiction
over the Selling Stockholder. No consent, approval, authorization or other
order of, or registration or filing with, any court or other governmental
authority or agency, is required for the consummation by the Selling
Stockholder of the transactions contemplated in this Agreement, except such
as have been obtained or made and are in full force and effect under the
Securities Act, applicable state securities or blue sky laws and from the
NASD.
(f) NO REGISTRATION OR OTHER SIMILAR RIGHTS. The Selling Stockholder
does not have any registration or other similar rights to have any equity or
debt securities registered for sale by the Company under the Registration
Statement or included in the offering contemplated by this Agreement, except
for such rights as are described in the Prospectus under "Shares Eligible for
Future Sale."
(g) NO FURTHER CONSENTS, ETC. No consent, approval or waiver is
required under any agreement to which the Selling Stockholder is a party or
by which it is bound or under which it is entitled to any right or benefit,
in connection with the offering, sale or purchase by the Underwriters of any
of the Common Shares which may be sold by the Selling Stockholder under this
Agreement or the consummation by the Selling Stockholder of any of the other
transactions contemplated hereby.
(h) DISCLOSURE MADE BY THE SELLING STOCKHOLDER IN THE PROSPECTUS.
All information furnished by or on behalf of the Selling Stockholder in
writing expressly for use in the Registration Statement and Prospectus is,
and on the First Closing Date and the Second Closing Date will be, true,
correct, and complete in all material respects, and does not, and on the
First Closing Date and the Second Closing Date will not, contain any untrue
statement of a material fact or omit to state any material fact necessary to
make such information not misleading. The Selling Stockholder confirms as
accurate the number of shares of Common Stock set forth opposite the Selling
Stockholder's name in the Prospectus under the caption "Principal and Selling
Stockholders" (both prior to and after giving effect to the sale of the
Common Shares).
(i) NO PRICE STABILIZATION OR MANIPULATION. The Selling Stockholder
has not taken and will not take, directly or indirectly, any action designed
to or that might be reasonably expected to cause or result in stabilization
or manipulation of the price of the Common Stock to facilitate the sale or
resale of the Common Shares.
Any certificate signed by or on behalf of the Selling Stockholder
and delivered to the Representatives or to counsel for the Underwriters shall
be deemed to be a representation and warranty by the Selling Stockholder to
each Underwriter as to the matters covered thereby.
10
SECTION 2. PURCHASE, SALE AND DELIVERY OF THE COMMON SHARES.
(a) THE FIRM COMMON SHARES. Upon the terms herein set forth (i) the
Company agrees to issue and sell to the several Underwriters an aggregate of
3,800,000 Firm Common Shares and (ii) the Selling Stockholder agrees to sell
to the several Underwriters an aggregate of 1,900,000 Firm Common Shares. On
the basis of the representations, warranties and agreements herein contained,
and upon the terms but subject to the conditions herein set forth, the
Underwriters agree, severally and not jointly, to purchase from the Company
and the Selling Stockholder the respective number of Firm Common Shares set
forth opposite their names on SCHEDULE A. The purchase price per Firm Common
Share to be paid by the several Underwriters to the Company and the Selling
Stockholder shall be $[___]per share.
(b) THE FIRST CLOSING DATE. Delivery of certificates for the Firm
Common Shares to be purchased by the Underwriters and payment therefor shall
be made at the offices of BAS, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ (or such other place as may be agreed to by the Company and the
Representatives) at 6:00 a.m. San Francisco time, on August __, 2000, or such
other time and date not later than 10:30 a.m. San Francisco time, as the
Representatives shall designate by notice to the Company (the time and date
of such closing are called the "First Closing Date"). The Company hereby
acknowledges that circumstances under which the Representatives may provide
notice to postpone the First Closing Date as originally scheduled include,
but are in no way limited to, any determination by the Company or the
Representatives to recirculate to the public copies of an amended or
supplemented Prospectus or a delay as contemplated by the provisions of
Section 10.
(c) THE OPTIONAL COMMON SHARES; THE SECOND CLOSING DATE. In
addition, on the basis of the representations, warranties and agreements
herein contained, and upon the terms but subject to the conditions herein set
forth, the Company hereby grants an option to the several Underwriters to
purchase, severally and not jointly, up to an aggregate of 855,000 Optional
Common Shares from the Company at the purchase price per share to be paid by
the Underwriters for the Firm Common Shares. The option granted hereunder is
for use by the Underwriters solely in covering any over-allotments in
connection with the sale and distribution of the Firm Common Shares. The
option granted hereunder may be exercised at any time (but not more than
once) upon notice by the Representatives to the Company, which notice may be
given at any time within 30 days from the date of this Agreement. Such notice
shall set forth (i) the aggregate number of Optional Common Shares as to
which the Underwriters are exercising the option, (ii) the names and
denominations in which the certificates for the Optional Common Shares are to
be registered and (iii) the time, date and place at which such certificates
will be delivered (which time and date may be simultaneous with, but not
earlier than, the First Closing Date; and in such case the term "First
Closing Date" shall refer to the time and date of delivery of certificates
for the Firm Common Shares and the Optional Common Shares). Such time and
date of delivery, if subsequent to the First Closing Date, is called the
"Second Closing Date" and shall be determined by the Representatives and
shall not be earlier than three nor later than five full business days after
delivery of such notice of exercise. If any Optional Common Shares are to be
purchased, each Underwriter agrees, severally and not jointly, to purchase
the number of Optional Common Shares (subject to such adjustments to
eliminate fractional shares as the Representatives may determine) that bears
the same proportion to the total number of Optional Common Shares to be
purchased as the number of Firm Common Shares set forth on SCHEDULE A
opposite the name of such Underwriter bears to the total number of Firm
Common Shares. The Representatives may cancel the option at any time prior to
its expiration by giving written notice of such cancellation to the Company.
(d) PUBLIC OFFERING OF THE COMMON SHARES. The Representatives hereby
advise the Company and the Selling Stockholder that the Underwriters intend
to offer for sale to the public, as described in the Prospectus, their
respective portions of the Common Shares as soon after this Agreement has been
11
executed and the Registration Statement has been declared effective as the
Representatives, in their sole judgment, have determined is advisable and
practicable.
(e) PAYMENT FOR THE COMMON SHARES. Payment for the Common Shares to
be sold by the Company shall be made at the First Closing Date (and, if
applicable, at the Second Closing Date) by wire transfer of immediately
available funds to the order of the Company. Payment for the Common Shares to
be sold by the Selling Stockholder shall be made at the First Closing Date by
wire transfer of immediately available funds to the order of the Custodian.
It is understood that the Representatives have been authorized, for
their own account and the accounts of the several Underwriters, to accept
delivery of and receipt for, and make payment of the purchase price for, the
Firm Common Shares and any Optional Common Shares the Underwriters have
agreed to purchase. BAS, individually and not as the Representative of the
Underwriters, may (but shall not be obligated to) make payment for any Common
Shares to be purchased by any Underwriter whose funds shall not have been
received by the Representatives by the First Closing Date or the Second
Closing Date, as the case may be, for the account of such Underwriter, but
any such payment shall not relieve such Underwriter from any of its
obligations under this Agreement.
The Selling Stockholder hereby agrees that (i) it will pay all stock
transfer taxes, stamp duties and other similar taxes, if any, payable upon
the sale or delivery of the Common Shares to be sold by the Selling
Stockholder to the several Underwriters, or otherwise in connection with the
performance of the Selling Stockholder's obligations hereunder and (ii) the
Custodian is authorized to deduct for such payment any such amounts from the
proceeds to the Selling Stockholder hereunder and to hold such amounts for
the account of the Selling Stockholder with the Custodian under the Custody
Agreement.
(f) DELIVERY OF THE COMMON SHARES. The Company and the Selling
Stockholder shall deliver, or cause to be delivered, to the Representatives
for the accounts of the several Underwriters certificates for the Firm Common
Shares to be sold by them at the First Closing Date, against the irrevocable
release of a wire transfer of immediately available funds for the amount of
the purchase price therefor. The Company shall also deliver, or cause to be
delivered, to the Representatives for the accounts of the several
Underwriters, certificates for the Optional Common Shares the Underwriters
have agreed to purchase at the First Closing Date or the Second Closing Date,
as the case may be, against the irrevocable release of a wire transfer of
immediately available funds for the amount of the purchase price therefor.
The certificates for the Common Shares shall be in definitive form and
registered in such names and denominations as the Representatives shall have
requested at least two full business days prior to the First Closing Date (or
the Second Closing Date, as the case may be) and shall be made available for
inspection on the business day preceding the First Closing Date (or the
Second Closing Date, as the case may be) at a location in New York City as
the Representative may designate. Time shall be of the essence, and delivery
at the time and place specified in this Agreement is a further condition to
the obligations of the Underwriters.
(g) DELIVERY OF PROSPECTUS TO THE UNDERWRITERS. Not later than 12:00
p.m. on the second business day following the date the Common Shares are
first released by the Underwriters for sale to the public, the Company shall
deliver or cause to be delivered, copies of the Prospectus in such quantities
and at such places as the Representatives shall request.
SECTION 3. ADDITIONAL COVENANTS.
A. ADDITIONAL COVENANTS OF THE COMPANY. The Company further covenants
and agrees with each Underwriter as follows:
12
(a) REPRESENTATIVES' REVIEW OF PROPOSED AMENDMENTS AND SUPPLEMENTS.
During such period beginning on the date hereof and ending on the later of
the First Closing Date or such date, as in the opinion of counsel for the
Underwriters, the Prospectus is no longer required by law to be delivered in
connection with sales by an Underwriter or dealer (the "Prospectus Delivery
Period"), prior to amending or supplementing the Registration Statement
(including any registration statement filed under Rule 462(b) under the
Securities Act) or the Prospectus, the Company shall furnish to the
Representatives for review a copy of each such proposed amendment or
supplement, and the Company shall not file any such proposed amendment or
supplement to which the Representatives or counsel for the Underwriters
reasonably object.
(b) SECURITIES ACT COMPLIANCE. After the date of this Agreement, the
Company shall promptly advise the Representatives in writing (i) of the
receipt of any comments of, or requests for additional or supplemental
information from, the Commission, (ii) of the time and date of any filing of
any post-effective amendment to the Registration Statement or any amendment
or supplement to any preliminary prospectus or the Prospectus, (iii) of the
time and date that any post-effective amendment to the Registration Statement
becomes effective and (iv) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or any
post-effective amendment thereto or of any order preventing or suspending the
use of any preliminary prospectus or the Prospectus, or of any proceedings to
remove, suspend or terminate from listing or quotation the Common Stock from
any securities exchange upon which it is listed for trading or included or
designated for quotation, or of the threatening or initiation of any
proceedings for any of such purposes. If the Commission shall enter any such
stop order at any time, the Company will use its best efforts to obtain the
lifting of such order at the earliest possible moment. Additionally, the
Company agrees that it shall comply with the provisions of Rules 424(b), 430A
and 434, as applicable, under the Securities Act and will use its reasonable
best efforts to confirm that any filings made by the Company under such Rule
424(b) were received in a timely manner by the Commission.
(c) AMENDMENTS AND SUPPLEMENTS TO THE PROSPECTUS AND OTHER
SECURITIES ACT MATTERS. If, during the Prospectus Delivery Period, any event
shall occur or condition exist as a result of which it is necessary to amend
or supplement the Prospectus in order to make the statements therein, in the
light of the circumstances when the Prospectus is delivered to a purchaser,
not misleading, or if in the opinion of the Representative or counsel for the
Underwriters it is otherwise necessary to amend or supplement the Prospectus
to comply with law, the Company agrees to promptly prepare (subject to
Section 3(A)(a) hereof), file with the Commission and furnish at its own
expense to the Underwriters and to dealers, amendments or supplements to the
Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the Prospectus
is delivered to a purchaser, be misleading or so that the Prospectus, as
amended or supplemented, will comply with law.
(d) COPIES OF ANY AMENDMENTS AND SUPPLEMENTS TO THE PROSPECTUS. The
Company agrees to furnish the Representative, without charge, during the
Prospectus Delivery Period, as many copies of the Prospectus and any
amendments and supplements thereto as the Representatives reasonably may
request. The Prospectus and any amendments or supplements thereto furnished
to the Underwriters will be identical to the electronically transmitted
copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the
extent permitted by Regulation S-T.
(e) BLUE SKY COMPLIANCE. The Company shall cooperate with the
Representatives and counsel for the Underwriters to qualify or register the
Common Shares for sale under (or obtain exemptions from the application of)
the state securities or blue sky laws or Canadian provincial securities laws
of those jurisdictions designated by the Representatives, shall comply with
such laws and shall continue such qualifications, registrations and
exemptions in effect so long as required for the distribution of the Common
Shares. The Company shall not be required to qualify as a foreign corporation
or to take
13
any action that would subject it to general service of process in any such
jurisdiction where it is not presently qualified or where it would be subject
to taxation as a foreign corporation. The Company will advise the
Representatives promptly of the suspension of the qualification or
registration of (or any such exemption relating to) the Common Shares for
offering, sale or trading in any jurisdiction or any initiation or threat of
any proceeding for any such purpose, and in the event of the issuance of any
order suspending such qualification, registration or exemption, the Company
shall use its best efforts to obtain the withdrawal thereof at the earliest
possible moment.
(f) USE OF PROCEEDS. The Company shall apply the net proceeds from
the sale of the Common Shares sold by it in the manner described under the
caption "Use of Proceeds" in the Prospectus.
(g) TRANSFER AGENT. The Company shall engage and maintain, at its
expense, a registrar and transfer agent for the Common Stock.
(h) QUOTATION. The Company will use its best efforts to effect and
maintain the quotation of the Common Shares on the Nasdaq National Market and
will file with the Nasdaq National Market all documents and notices required
by the Nasdaq National Market of companies that have securities that are
traded in the over-the-counter market and quotations for which are reported
by the Nasdaq National Market.
(i) EARNINGS STATEMENT. As soon as practicable, the Company will
make generally available to its security holders and to the Representative an
earnings statement (which need not be audited) covering a period of at least
twelve (12) months beginning after the effective date of the Registration
Statement (as defined in Rule 158(c) under the Securities Act) that satisfies
the provisions of, and provides the benefits contemplated by, Section 11(a)
of the Securities Exchange Act of 1934 and the rules and regulations
promulgated thereunder (collectively, the "Exchange Act").
(j) PERIODIC REPORTING OBLIGATIONS. During the Prospectus Delivery
Period the Company shall file, on a timely basis, with the Commission and the
Nasdaq National Market all reports and documents required to be filed under
the Exchange Act.
(k) AGREEMENT NOT TO OFFER OR SELL ADDITIONAL SECURITIES. During the
period of 180 days following the date of the Prospectus, the Company will
not, without the prior written consent of BAS (which consent may be withheld
at the sole discretion of BAS), directly or indirectly, sell, offer, contract
or grant any option to sell, pledge, transfer or establish an open "put
equivalent position" within the meaning of Rule 16a-1(h) under the Exchange
Act, or otherwise dispose of or transfer, or announce the offering of, or
file any registration statement under the Securities Act in respect of, any
shares of Common Stock, options or warrants to acquire shares of the Common
Stock or securities exchangeable or exercisable for or convertible into
shares of Common Stock (other than as contemplated by this Agreement with
respect to the Common Shares); PROVIDED, HOWEVER, (i) that the Company may
issue shares of its Common Stock or options to purchase its Common Stock, or
Common Stock upon exercise of options, pursuant to any stock option, stock
bonus or other stock plan or arrangement described in the Prospectus, but
only if the holders of such shares, options, or shares issued upon exercise
of such options, agree in writing not to sell, offer, dispose of or otherwise
transfer any such shares or options during such 180 day period without the
prior written consent of BAS (which consent may be withheld at the sole
discretion of BAS) and; (ii) file a registration statement with respect to
any stock option, stock bonus or other stock plan or arrangement described in
the Prospectus, (iii) issue shares in connection with the acquisition of
certain assets of Health Services Foundation Alabama Tissue Center, as
described in the Prospectus and (iv) issue shares in connection with a merger
or acquisition by the Company of the assets
14
or capital stock of another person or entity, so long as the shares so issued
by the Company may not be resold for a period of 180 days after the date of
the Prospectus.
(l) FUTURE REPORTS TO THE REPRESENTATIVES. During the period of five
years hereafter the Company will furnish to the Representatives at ▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, (i) as soon as
practicable after the end of each fiscal year, copies of the Annual Report of
the Company containing the balance sheet of the Company as of the close of
such fiscal year and statements of income, stockholders' equity and cash
flows for the year then ended and the opinion thereon of the Company's
independent public or certified public accountants; (ii) as soon as
practicable after the filing thereof, copies of each proxy statement, Annual
Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form
8-K or other report filed by the Company with the Commission, the NASD or any
securities exchange; and (iii) as soon as available, copies of any report or
communication of the Company mailed generally to holders of its capital stock.
BAS, on behalf of the several Underwriters, may, in its sole
discretion, waive in writing the performance by the Company of any one or
more of the foregoing covenants or extend the time for their performance.
B. COVENANT OF THE SELLING STOCKHOLDER. The Selling Stockholder
further covenants and agrees with each Underwriter to deliver to the
Representatives prior to the First Closing Date a properly completed and
executed United States Treasury Department Form W-9.
SECTION 4. PAYMENT OF EXPENSES. The Company agrees to pay all costs,
fees and expenses incurred in connection with the performance of its
obligations hereunder and in connection with the transactions contemplated
hereby, including without limitation (i) all expenses incident to the
issuance and delivery of the Common Shares (including all printing and
engraving costs), (ii) all fees and expenses of the registrar and transfer
agent of the Common Stock, (iii) all necessary issue, transfer and other
stamp taxes in connection with the issuance and sale of the Common Shares to
the Underwriters, (iv) all fees and expenses of the Company's counsel,
independent public or certified public accountants and other advisors, (v)
all costs and expenses incurred in connection with the preparation, printing,
filing, shipping and distribution of the Registration Statement (including
financial statements, exhibits, schedules, consents and certificates of
experts), each preliminary prospectus, any Term Sheet and the Prospectus, and
all amendments and supplements thereto, and this Agreement, (vi) all filing
fees, attorneys' fees and expenses incurred by the Company or the
Underwriters in connection with qualifying or registering (or obtaining
exemptions from the qualification or registration of) all or any part of the
Common Shares for offer and sale under the state securities or blue sky laws
or the provincial securities laws of Canada or securities laws of any other
jurisdiction, and, if requested by the Representatives, preparing and
printing a "Blue Sky Survey" or memorandum, and any supplements thereto,
advising the Underwriters of such qualifications, registrations and
exemptions, (vii) the filing fees incident to, and the reasonable fees and
expenses of counsel for the Underwriters in connection with, the NASD's
review and approval of the Underwriters' participation in the offering and
distribution of the Common Shares, (viii) the fees and expenses associated
with listing the Common Shares on the Nasdaq National Market and (ix) all
other fees, costs and expenses referred to in Item 13 of Part II of the
Registration Statement. Except as provided in this Section 4, Section 6,
Section 8 and Section 9 hereof, the Underwriters shall pay their own
expenses, including the fees and disbursements of their counsel.
The Selling Stockholder further agrees with each Underwriter to pay
(directly or by reimbursement to the Company) all fees and expenses incident
to the performance of its obligations under this Agreement which are not
otherwise specifically provided for herein, including but not limited to (i)
fees and expenses of its counsel and other advisors, (ii) fees and expenses
of the Custodian and (iii) expenses and taxes incident to the sale and
delivery of the Common Shares to be sold by it to the
15
Underwriters hereunder (which taxes, if any, may be deducted by the Custodian
under the provisions of Section 2 of this Agreement).
This Section 4 shall not affect or modify any separate, valid
agreement relating to the allocation of payment of expenses between the
Company, on the one hand, and the Selling Stockholder, on the other hand.
SECTION 5. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the several Underwriters to purchase and pay for the Common
Shares as provided herein on the First Closing Date and, with respect to the
Optional Common Shares, the First Closing Date or the Second Closing Date, as
applicable, shall be subject (a) to the accuracy of the representations and
warranties on the part of the Company and the Selling Stockholder set forth
in Section 1 hereof as of the date hereof and as of the First Closing Date as
though then made and, with respect to the Optional Common Shares, as of the
First Closing Date or the Second Closing Date, as applicable, as though then
made, or in certificates of any officer of the Company or any of its
subsidiaries or the Selling Stockholder delivered pursuant to the provisions
hereof, (b) to the timely performance by the Company and the Selling
Stockholder of their covenants and other obligations hereunder, and (c) to
each of the following additional conditions:
(a) ACCOUNTANTS' COMFORT LETTER. On the date hereof, the
Representatives shall have received from Deloitte & Touche LLP, independent
public or certified public accountants for the Company, a letter dated the
date hereof addressed to the Underwriters, in form and substance satisfactory
to the Representatives, containing statements and information of the type
ordinarily included in accountant's "comfort letters" to underwriters,
delivered according to Statement of Auditing Standards No. 72 (or any
successor bulletin), with respect to the audited and unaudited financial
statements and certain financial information contained in the Registration
Statement and the Prospectus (and the Representatives shall have received
additional conformed copies of such accountants' letter for each of the
several Underwriters).
(b) COMPLIANCE WITH REGISTRATION REQUIREMENTS; NO STOP ORDER; NO
OBJECTION FROM NASD. The Registration Statement (including any Rule 462(b)
Registration Statement) shall have become effective and after effectiveness
of this Agreement and prior to the First Closing Date and, with respect to
the Optional Common Shares, the First Closing Date or the Second Closing
Date, as applicable:
(i) the Company shall have filed the Prospectus with the
Commission (including the information required by Rule 430A under the
Securities Act) in the manner and within the time period required by
Rule 424(b) under the Securities Act; or the Company shall have filed a
post-effective amendment to the Registration Statement containing the
information required by such Rule 430A, and such post-effective
amendment shall have become effective; or, if the Company elected to
rely upon Rule 434 under the Securities Act and obtained the
Representatives' consent thereto, the Company shall have filed a Term
Sheet with the Commission in the manner and within the time period
required by such Rule 424(b);
(ii) no stop order suspending the effectiveness of the
Registration Statement, any Rule 462(b) Registration Statement, or any
post-effective amendment to the Registration Statement, shall be in
effect and no proceedings for such purpose shall have been instituted
or threatened by the Commission and any request on the part of the
Commission for additional information shall have been complied with to
the reasonable satisfaction of the Representatives; and
16
(iii) the NASD shall have confirmed that it will not raise any
objection to the fairness and reasonableness of the underwriting terms
and arrangements.
(c) NO MATERIAL ADVERSE CHANGE. For the period from and after the
date of this Agreement and prior to the First Closing Date and, with respect
to the Optional Common Shares, the First Closing Date or the Second Closing
Date, as applicable, in the judgment of the Representatives there shall not
have occurred any Material Adverse Change.
(d) OPINION OF COUNSEL FOR THE COMPANY. On each of the First Closing
Date and the Second Closing Date, if any, the Representatives shall have
received the favorable opinion of Fulbright & ▇▇▇▇▇▇▇▇ L.L.P., counsel for
the Company, dated as of such Closing Date, with respect to the matters set
forth in EXHIBIT A and to such further effect as counsel for the Underwriters
may reasonably request (and the Representatives shall have received
additional conformed copies of such counsel's legal opinion for each of the
several Underwriters).
(e) OPINION OF INTELLECTUAL PROPERTY COUNSEL FOR THE COMPANY. On
each of the First Closing Date and the Second Closing Date, if any, the
Representatives shall have received the favorable opinion of Bencen & ▇▇▇
▇▇▇▇, P.A., intellectual property counsel for the Company, dated as of such
Closing Date, with respect to the matters set forth in EXHIBIT A-1 and to
such further effect as counsel for the Underwriters may reasonably request
(and the Representatives shall have received additional conformed copies of
such counsel's legal opinion for each of the several Underwriters).
(f) OPINION OF REGULATORY COUNSEL FOR THE COMPANY. On each of the
First Closing Date and the Second Closing Date, if any, the Representatives
shall have received the favorable opinion of ▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, P.C.,
regulatory counsel for the Company, dated as of such Closing Date, with
respect to the matters set forth in EXHIBIT A-2 and to such further effect as
counsel for the Underwriters may reasonably request (and the Representatives
shall have received additional conformed copies of such counsel's legal
opinion for each of the several Underwriters).
(g) OPINION OF COUNSEL FOR THE UNDERWRITERS. On each of the First
Closing Date and the Second Closing Date, if any, the Representatives shall
have received the favorable opinion of Mintz, Levin, Cohn, Ferris, Glovsky
and Popeo, P.C., counsel for the Underwriters, dated as of such Closing Date,
with respect to the matters set forth in paragraphs (i), (x), (xi) and (xiii)
(with respect to the captions "Description of Capital Stock" and
"Underwriting" under subparagraph (i) only), and the next-to-last paragraph
of EXHIBIT A (and the Representatives shall have received additional
conformed copies of such counsel's legal opinion for each of the several
Underwriters). In giving such opinion such counsel may rely, as to all
matters governed by the laws of jurisdictions other than the law of the
United States and the General Corporation Law of the State of Delaware, upon
the opinions (which shall be dated as of such Closing Date, shall be
satisfactory in form and substance to the Representatives, shall expressly
state that the Underwriters may rely on such opinion as if it were addressed
to them and shall be furnished to the Representatives) of other counsel of
good standing whom they believe to be reliable; PROVIDED, HOWEVER, that such
counsel shall further state that they believe that they and the Underwriters
are justified in relying upon such opinion of other counsel satisfactory to
the Representatives. Such counsel may also state that, insofar as such
opinion involves factual matters, they have relied, to the extent they deem
proper, upon certificates of officers of the Company and its subsidiaries and
certificates of public officials.
(h) OFFICERS' CERTIFICATE. On each of the First Closing Date and the
Second Closing Date, if any, the Representatives shall have received a
written certificate executed by the Chairman of the Board, Chief Executive
Officer or President of the Company and the Chief Financial Officer or Chief
Accounting Officer of the Company, dated as of such Closing Date, to the
effect set forth in subsection (b)(ii) of this Section 5, and further to the
effect that:
17
(i) for the period from and after the date of this Agreement
and prior to such Closing Date, there has not occurred any Material
Adverse Change;
(ii) the representations, warranties and covenants of the
Company set forth in Section 1 of this Agreement are true and correct
with the same force and effect as though expressly made on and as of
such Closing Date;
(iii) the Company has complied with all the agreements
hereunder and satisfied all the conditions on its part to be performed
or satisfied hereunder at or prior to such Closing Date; and
(iv) the Registration Statement of the Company on Form S-1
(Registration No. 333-35756), in the form in which it was declared
effective by the Commission on August 9, 2000, and the Prospectus dated
July 19, 2000, contain all statements which are required to be stated
therein in accordance with the Securities Act and the rules and
regulations of the Commission thereunder. The Registration Statement
does not contain an 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, and the Prospectus does not
contain an 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, in light of the circumstances under which they were
made, not misleading.
(i) SECRETARY'S CERTIFICATE. On each of the First Closing Date and
the Second Closing Date, if any, the Representatives shall have received a
certificate or certificates of the Secretary of the Company in form and
substance reasonably satisfactory to the Representatives.
(j) BRING-DOWN COMFORT LETTER. On each of the First Closing Date and
the Second Closing Date, if any, the Representatives shall have received from
Deloitte & Touche LLP, independent public or certified public accountants for
the Company, a letter dated such date, in form and substance satisfactory to
the Representatives, to the effect that they reaffirm the statements made in
the letter furnished by them pursuant to subsection (a) of this Section 5,
except that the specified date referred to therein for the carrying out of
procedures shall be no more than three business days prior to the First
Closing Date or Second Closing Date, as the case may be (and the
Representatives shall have received additional conformed copies of such
accountants' letter for each of the several Underwriters).
(k) LOCK-UP AGREEMENT FROM CERTAIN SECURITYHOLDERS OF THE COMPANY.
On the date hereof, the Company shall have furnished to the Representatives
an agreement substantially in the form of EXHIBIT B hereto from each
director, officer and substantially all of the beneficial owners of Common
Stock (as defined and determined according to Rule 13d-3 under the Exchange
Act, except that a one hundred eighty day period shall be used rather than
the sixty day period set forth therein), and such agreement shall be in full
force and effect on each of the First Closing Date and the Second Closing
Date, if any.
(l) OPINION OF COUNSEL FOR THE SELLING STOCKHOLDER. On the First
Closing Date, the Representatives shall have received the favorable opinion
of Dean, Mead, Egerton, Bloodworth, Capouano & ▇▇▇▇▇▇▇, P.A., counsel for the
Selling Stockholder, dated as of such Closing Date, the form of which is
attached as EXHIBIT A-3 (and the Representatives shall have received
additional conformed copies of such counsel's legal opinion for each of the
several Underwriters).
(m) SELLING STOCKHOLDER'S CERTIFICATE. On the First Closing Date,
the Representatives shall receive a written certificate executed by the
Selling Stockholder, dated as of such Closing Date, to the effect that:
18
(i) the representations, warranties and covenants of the
Selling Stockholder set forth in Section 1(B) of this Agreement are true and
correct with the same force and effect as though expressly made by the
Selling Stockholder on and as of such Closing Date; and
(ii) the Selling Stockholder has complied with all the
agreements and satisfied all the conditions on its part to be performed or
satisfied at or prior to such Closing Date.
(n) SELLING STOCKHOLDER'S DOCUMENTS. On the date hereof, the Company
and the Selling Stockholder shall have furnished for review by the
Representatives a copy of the Power of Attorney and Custody Agreement
executed by the Selling Stockholder and such further information,
certificates and documents as the Representatives may reasonably request.
(o) ADDITIONAL DOCUMENTS. On or before each of the First Closing
Date and the Second Closing Date, if any, the Representatives and counsel for
the Underwriters shall have received such information, documents and opinions
as they may reasonably require for the purposes of enabling them to pass upon
the issuance and sale of the Common Shares as contemplated herein, or in
order to evidence the accuracy of any of the representations and warranties,
or the satisfaction of any of the conditions or agreements, herein contained,
and all proceedings taken by the Company and the Selling Stockholder in
connection with the issuance and sale of the Common Shares as herein
contemplated shall be satisfactory in form and substance to the
Representatives and counsel for the Underwriters.
If any condition specified in this Section 5 is not satisfied when
and as required to be satisfied, this Agreement may be terminated by the
Representatives by notice to the Company and the Selling Stockholder at any
time on or prior to the First Closing Date and, with respect to the Optional
Common Shares, at any time prior to the Second Closing Date, which
termination shall be without liability on the part of any party to any other
party, except that Section 4, Section 6, Section 8 and Section 9 shall at all
times be effective and shall survive such termination.
SECTION 6. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If this
Agreement is terminated by the Representatives pursuant to Section 5, Section
7, Section 10 or Section 11, other than due to breach or default of one or
more of the underwriters, or if the sale to the Underwriters of the Common
Shares on the First Closing Date or the Second Closing Date is not
consummated because of any refusal, inability or failure on the part of the
Company or the Selling Stockholder to perform any agreement herein or to
comply with any provision hereof, the Company agrees to reimburse the
Representatives and the other Underwriters (or such Underwriters as have
terminated this Agreement with respect to themselves), severally, upon demand
for all out-of-pocket expenses that shall have been reasonably incurred by
the Representatives and the Underwriters in connection with the proposed
purchase and the offering and sale of the Common Shares, including but not
limited to reasonable fees and disbursements of counsel, printing expenses,
travel expenses, postage, delivery, facsimile and telephone charges.
SECTION 7. EFFECTIVENESS OF THIS AGREEMENT. This Agreement shall not
become effective until the later of (i) the execution of this Agreement by
the parties hereto and (ii) notification by the Commission to the Company and
the Representatives of the effectiveness of the Registration Statement under
the Securities Act.
Prior to such effectiveness, this Agreement may be terminated by any
party by notice to each of the other parties hereto, and any such termination
shall be without liability on the part of (a) the Company or the Selling
Stockholder to any Underwriter, except that the Company shall be obligated to
reimburse the expenses of the Representatives and the Underwriters pursuant
to Sections 4 and 6 hereof, (b) of any Underwriter to the Company or the
Selling Stockholder, or (c) of any party hereto to any other party
19
except that the provisions of Section 8 and Section 9 shall at all times be
effective and shall survive such termination.
SECTION 8. INDEMNIFICATION.
(a) INDEMNIFICATION OF THE UNDERWRITERS BY THE COMPANY. The Company
agrees to indemnify and hold harmless each Underwriter, its officers and
employees, and each person, if any, who controls any Underwriter within the
meaning of the Securities Act and the Exchange Act against any loss, claim,
damage, liability or expense whatsoever, as incurred, to which such
Underwriter or such controlling person may become subject, under the
Securities Act, the Exchange Act or other federal or state statutory law or
regulation, or at common law or otherwise (including in settlement of any
litigation, if such settlement is effected with the written consent of the
Company), insofar as such loss, claim, damage, liability or expense (or
actions in respect thereof as contemplated below) arises out of or is based
(i) upon any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, or any amendment thereto, including
any information deemed to be a part thereof pursuant to Rule 430A or Rule 434
under the Securities Act, or the omission or alleged omission therefrom of a
material fact required to be stated therein or necessary to make the
statements therein not misleading; or (ii) upon any untrue statement or
alleged untrue statement of a material fact contained in any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto), or the
omission or alleged omission therefrom of a material fact necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading; or (iii) upon the investigation, preparation
or defense against (including the fees and disbursements of counsel chosen by
BAS) any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based upon
any such untrue statement or omission, or any such alleged untrue statement
or omission or in connection with any violation of law, to the extent that
any such expense is not paid under (i) or (ii) above; or (iv) in whole or in
part upon any inaccuracy in the representations and warranties of the Company
contained herein; or (v) in whole or in part upon any failure of the Company
to perform its obligations hereunder or under law; or (vi) upon any act or
failure to act or any alleged act or failure to act by any Underwriter or any
person controlling such Underwriter within the meaning of the Securities Act
or the Exchange Act in connection with, or relating in any manner to, the
Common Stock or the offering contemplated hereby, and which is included as
part of or referred to in any loss, claim, damage, liability or action
arising out of or based upon any matter covered by clause (i) or (ii) above,
PROVIDED that the Company shall not be liable under this clause (vi) to the
extent that a court of competent jurisdiction shall have determined by a
final judgment that such loss, claim, damage, liability or action resulted
directly from any such acts or failures to act undertaken or omitted to be
taken by such Underwriter through its bad faith or willful misconduct; and to
reimburse each Underwriter and each such controlling person for any and all
expenses (including the reasonable fees and disbursements of counsel chosen
by BAS) as such expenses are reasonably incurred by such Underwriter or such
controlling person in connection with investigating, defending, settling,
compromising or paying any such loss, claim, damage, liability, expense or
action; PROVIDED, HOWEVER, that the foregoing indemnity agreement shall not
apply to any loss, claim, damage, liability or expense to the extent, but
only to the extent, arising out of or based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in reliance
upon and in conformity with written information furnished to the Company by
the Representatives expressly for use in the Registration Statement, any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto); and PROVIDED, FURTHER, that with respect to any preliminary
prospectus, the foregoing indemnity agreement shall not inure to the benefit
of any Underwriter from whom the person asserting any loss, claim, damage,
liability or expense purchased Common Shares, or any person controlling such
Underwriter, if copies of the Prospectus were timely delivered to the
Underwriter pursuant to Section 2 and a copy of the Prospectus (as then
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto) was not sent or given by or on behalf of such
Underwriter to such person, if required by law so to have been delivered, at
or prior to the written confirmation of the sale of
20
the Common Shares to such person, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such loss, claim,
damage, liability or expense. The indemnity agreement set forth in this
Section 8(a) shall be in addition to any liabilities that the Company may
otherwise have.
(b) INDEMNIFICATION OF THE UNDERWRITERS BY THE SELLING
STOCKHOLDER. Subject to Section 8(f), the Selling Stockholder agrees to
indemnify and hold harmless each Underwriter, its officers and employees, and
each person, if any, who controls any Underwriter within the meaning of the
Securities Act and the Exchange Act against any loss, claim, damage,
liability or expense whatsoever, as incurred, to which such Underwriter or
such controlling person may become subject, under the Securities Act, the
Exchange Act or other federal or state statutory law or regulation, or at
common law or otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of the Company), insofar as
such loss, claim, damage, liability or expense (or actions in respect thereof
as contemplated below) arises out of or is based (i) upon any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement, or any amendment thereto, including any information
deemed to be a part thereof pursuant to Rule 430A or Rule 434 under the
Securities Act, or the omission or alleged omission therefrom of a material
fact required to be stated therein or necessary to make the statements
therein not misleading; or (ii) upon any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto), or the omission or
alleged omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; or (iii) upon the investigation, preparation or defense
against (including the reasonable fees and disbursements of counsel chosen by
BAS) any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based upon
any such untrue statement or omission, or any such alleged untrue statement
or omission or in connection with any violation of law, to the extent that
any such expense is not paid under (i) or (ii) above; or (iv) in whole or in
part upon any inaccuracy in the representations and warranties of the Selling
Stockholder contained herein; or (v) in whole or in part upon any failure of
the Selling Stockholder to perform his obligations hereunder or under law; or
(vi) upon any act or failure to act or any alleged act or failure to act by
any Underwriter or any person controlling such Underwriter within the meaning
of the Securities Act or the Exchange Act in connection with, or relating in
any manner to, the Common Stock or the offering contemplated hereby, and
which is included as part of or referred to in any loss, claim, damage,
liability or action arising out of or based upon any matter covered by clause
(i) or (ii) above, PROVIDED that the Selling Stockholder shall not be liable
under this clause (vi) to the extent that a court of competent jurisdiction
shall have determined by a final judgment that such loss, claim, damage,
liability or action resulted directly from any such acts or failures to act
undertaken or omitted to be taken by such Underwriter through its bad faith
or willful misconduct; and to reimburse each Underwriter and each such
controlling person for any and all expenses (including the reasonable fees
and disbursements of counsel chosen by BAS) as such expenses are reasonably
incurred by such Underwriter or such controlling person in connection with
investigating, defending, settling, compromising or paying any such loss,
claim, damage, liability, expense or action; PROVIDED, HOWEVER, that the
foregoing indemnity agreement shall not apply to any loss, claim, damage,
liability or expense to the extent, but only to the extent, arising out of or
based upon any untrue statement or alleged untrue statement or omission or
alleged omission made in reliance upon and in conformity with written
information furnished to the Company by the Representatives expressly for use
in the Registration Statement, any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto); and provided, further, that with
respect to any preliminary prospectus, the foregoing indemnity agreement
shall not inure to the benefit of any Underwriter from whom the person
asserting any loss, claim, damage, liability or expense purchased Common
Shares, or any person controlling such Underwriter, if copies of the
Prospectus were timely delivered to the Underwriter pursuant to Section 2 and
a copy of the Prospectus (as then amended or supplemented if the Company
shall have furnished any amendments or supplements thereto) was not sent or
given by or on behalf of such Underwriter to such person, if required by law
so to have been delivered,
21
at or prior to the written confirmation of the sale of the Common Shares to
such person, and if the Prospectus (as so amended or supplemented) would have
cured the defect giving rise to such loss, claim, damage, liability or
expense. The indemnity agreement set forth in this Section 8(b) shall be in
addition to any liabilities that the Selling Stockholder may otherwise have.
(c) INDEMNIFICATION OF THE COMPANY, ITS DIRECTORS, OFFICERS AND THE
SELLING STOCKHOLDER. Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, each of its directors, each of its
officers who signed the Registration Statement, the Selling Stockholder and
each person, if any, who controls the Company within the meaning of the
Securities Act or the Exchange Act, against any loss, claim, damage,
liability or expense, as incurred, to which the Company, or any such
director, officer, Selling Stockholder or controlling person may become
subject, under the Securities Act, the Exchange Act, or other federal or
state statutory law or regulation, or at common law or otherwise (including
in settlement of any litigation, if such settlement is effected with the
written consent of such Underwriter), insofar as such loss, claim, damage,
liability or expense (or actions in respect thereof as contemplated below)
arises out of or is based upon any untrue or alleged untrue statement of a
material fact contained in the Registration Statement, any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto), or
arises out of or is based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only
to the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in the Registration Statement, any
preliminary prospectus, the Prospectus (or any amendment or supplement
thereto), in reliance upon and in conformity with written information
furnished to the Company by the Representatives expressly for use therein;
and to reimburse the Company, or any such director, officer, Selling
Stockholder or controlling person for any legal and other expense reasonably
incurred by the Company, or any such director, officer, Selling Stockholder
or controlling person in connection with investigating, defending, settling,
compromising or paying any such loss, claim, damage, liability, expense or
action. Each of the Company and the Selling Stockholder hereby acknowledges
that the only information that the Underwriters have furnished to the Company
expressly for use in the Registration Statement, any preliminary prospectus
or the Prospectus (or any amendment or supplement thereto) are the statements
set forth after the table after the first paragraph and in the second,
seventh, ninth, tenth, eleventh and twelfth paragraphs under the caption
"Underwriting" in the Prospectus; and the Underwriters confirm that such
statements are correct. The indemnity agreement set forth in this Section
8(c) shall be in addition to any liabilities that each Underwriter may
otherwise have.
(d) NOTIFICATIONS AND OTHER INDEMNIFICATION PROCEDURES. Promptly
after receipt by an indemnified party under this Section 8 of notice of the
commencement of any action, such indemnified party will, if a claim in
respect thereof is to be made against an indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement
thereof, but the omission so to notify the indemnifying party will not
relieve it from any liability which it may have to any indemnified party for
contribution or otherwise than under the indemnity agreement contained in
this Section 8 or to the extent it is not prejudiced as a proximate result of
such failure. In case any such action is brought against any indemnified
party and such indemnified party seeks or intends to seek indemnity from an
indemnifying party, the indemnifying party will be entitled to participate
in, and, to the extent that it shall elect, jointly with all other
indemnifying parties similarly notified, by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party; PROVIDED, HOWEVER, if the defendants
in any such action include both the indemnified party and the indemnifying
party and the indemnified party shall have reasonably concluded that a
conflict may arise between the positions of the indemnifying party and the
indemnified party in conducting the defense of any such action or that there
may be legal defenses available to it and/or other indemnified parties which
are different from or additional to those available to the indemnifying
party, the indemnified party or parties shall have the right to select
separate counsel to
22
assume such legal defenses and to otherwise participate in the defense of
such action on behalf of such indemnified party or parties. Upon receipt of
notice from the indemnifying party to such indemnified party of such
indemnifying party's election so to assume the defense of such action and
approval by the indemnified party of counsel, the indemnifying party will not
be liable to such indemnified party under this Section 8 for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof unless (i) the indemnified party shall have employed
separate counsel in accordance with the proviso to the next preceding
sentence (it being understood, however, that the indemnifying party shall not
be liable for the expenses of more than one separate counsel (together with
local counsel), approved by the indemnifying party (BAS in the case of
Section 8(c) and Section 9), representing the indemnified parties who are
parties to such action) or (ii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of
the action, in each of which cases the fees and expenses of counsel shall be
at the expense of the indemnifying party.
(e) SETTLEMENTS. The indemnifying party under this Section 8 shall
not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party against any loss, claim, damage, liability or expense by
reason of such settlement or judgment. Notwithstanding the foregoing
sentence, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses
of counsel as contemplated by Section 8(d) hereof, the indemnifying party
agrees that it shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than
30 days after receipt by such indemnifying party of the aforesaid request and
(ii) such indemnifying party shall not have reimbursed the indemnified party
in accordance with such request prior to the date of such settlement. No
indemnifying party shall, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be
sought under this Section 8 or Section 9 hereof (whether or not the
indemnified parties are actual or potential parties thereto), unless such
settlement, compromise or consent (i) includes an unconditional release of
each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as
to or an admission of fault, culpability or a failure to act by or on behalf
of any indemnified party.
(f) LIMITATION ON LIABILITY OF THE SELLING STOCKHOLDER. The
liability of the Selling Stockholder under the representations, warranties
and agreements contained herein and under the indemnity and contribution
agreements contained in the provisions of this Section 8 and Section 9 shall
be limited to an amount equal to the aggregate initial public offering price
of all Common Shares sold by the Selling Stockholder to the Underwriters
minus the amount of the underwriting discount paid thereon to the
Underwriters by the Selling Stockholder. The Company and the Selling
Stockholder may agree, as among themselves and without limiting the rights of
the Underwriters under this Agreement, as to the respective amounts of such
liability for which they each shall be responsible.
SECTION 9. CONTRIBUTION.
If the indemnification provided for in Section 8 is for any reason
held to be unavailable to or otherwise insufficient to hold harmless an
indemnified party in respect of any losses, claims, damages, liabilities or
expenses referred to therein, then each indemnifying party shall contribute
to the aggregate amount paid or payable by such indemnified party, as
incurred, as a result of any losses, claims, damages, liabilities or expenses
referred to therein (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and the Selling Stockholder, on the
one hand, and the Underwriters, on
23
the other hand, from the offering of the Common Shares pursuant to this
Agreement or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company and the Selling Stockholder, on the one hand,
and the Underwriters, on the other hand, in connection with the statements or
omissions or inaccuracies in the representations and warranties herein which
resulted in such losses, claims, damages, liabilities or expenses, as well as
any other relevant equitable considerations. The relative benefits received
by the Company and the Selling Stockholder, on the one hand, and the
Underwriters, on the other hand, in connection with the offering of the
Common Shares pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the
Common Shares pursuant to this Agreement (before deducting expenses) received
by the Company and the Selling Stockholder, and the total underwriting
discount received by the Underwriters, in each case as set forth on the front
cover page of the Prospectus (or, if Rule 434 under the Securities Act is
used, the corresponding location on the Term Sheet) bear to the aggregate
initial public offering price of the Common Shares as set forth on such
cover. The relative fault of the Company and the Selling Stockholder, on the
one hand, and the Underwriters, on the other hand, shall be determined by
reference to, among other things, whether any such untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a
material fact or any such inaccurate or alleged inaccurate representation or
warranty relates to information supplied by the Company and the Selling
Stockholder, on the one hand, or the Underwriters, on the other hand, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses,
claims, damages, liabilities and expenses referred to above shall be deemed
to include, subject to the limitations set forth in Section 8(d), any legal
or other fees or expenses reasonably incurred by such party in connection
with investigating or defending any action or claim. The provisions set forth
in Section 8(d) with respect to notice of commencement of any action shall
apply if a claim for contribution is to be made under this Section 9;
PROVIDED, HOWEVER, that no additional notice shall be required with respect
to any action for which notice has been given under Section 8(d) for purposes
of indemnification.
The Company, the Selling Stockholder and the Underwriters agree that
it would not be just and equitable if contribution pursuant to this Section 9
were determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation which
does not take account of the equitable considerations referred to in this
Section 9.
Notwithstanding the provisions of this Section 9, no Underwriter
shall be required to contribute any amount in excess of the amount by which
the underwriting commissions received by such Underwriter in connection with
the Common Shares underwritten by it and distributed to the public exceeds
the amount of any damages which such Underwriter has otherwise been required
to pay pursuant to Section 8 or Section 9. 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. The Underwriters' obligations to contribute
pursuant to this Section 9 are several, and not joint, in proportion to their
respective underwriting commitments as set forth opposite their names in
SCHEDULE A. For purposes of this Section 9, each officer and employee of an
Underwriter and each person, if any, who controls an Underwriter within the
meaning of the Securities Act and the Exchange Act shall have the same rights
to contribution as such Underwriter, and each director of the Company, each
officer of the Company who signed the Registration Statement, and the Selling
Stockholder and each person, if any, who controls the Company within the
meaning of the Securities Act and the Exchange Act shall have the same rights
to contribution as the Company.
24
SECTION 10. DEFAULT OF ONE OR MORE OF THE SEVERAL UNDERWRITERS. If,
on the First Closing Date or the Second Closing Date, as the case may be, any
one or more of the several Underwriters shall fail or refuse to purchase
Common Shares that it or they have agreed to purchase hereunder on such date,
and the aggregate number of Common Shares which such defaulting Underwriter
or Underwriters agreed but failed or refused to purchase does not exceed 10%
of the aggregate number of the Common Shares to be purchased on such date,
the other Underwriters shall be obligated, severally, in the proportions that
the number of Firm Common Shares set forth opposite their respective names on
SCHEDULE A bears to the aggregate number of Firm Common Shares set forth
opposite the names of all such non-defaulting Underwriters, or in such other
proportions as may be specified by the Representatives with the consent of
the non-defaulting Underwriters, to purchase the Common Shares which such
defaulting Underwriter or Underwriters agreed but failed or refused to
purchase on such date. If, on the First Closing Date or the Second Closing
Date, as the case may be, any one or more of the Underwriters shall fail or
refuse to purchase Common Shares and the aggregate number of Common Shares
with respect to which such default occurs exceeds 10% of the aggregate number
of Common Shares to be purchased on such date, and arrangements satisfactory
to the Representatives and the Company for the purchase of such Common Shares
are not made within 48 hours after such default, this Agreement shall
terminate without liability of any party to any other party except that the
provisions of Section 4, Section 6, Section 8 and Section 9 shall at all
times be effective and shall survive such termination. In any such case
either the Representatives or the Company shall have the right to postpone
the First Closing Date or the Second Closing Date, as the case may be, but in
no event for longer than seven days in order that the required changes, if
any, to the Registration Statement and the Prospectus or any other documents
or arrangements may be effected.
As used in this Agreement, the term "Underwriter" shall be deemed to
include any person substituted for a defaulting Underwriter under this
Section 10. Any action taken under this Section 10 shall not relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
SECTION 11. TERMINATION OF THIS AGREEMENT. Prior to the First
Closing Date this Agreement may be terminated by the Representatives by
notice given to the Company and the Selling Stockholder if at any time (i)
trading or quotation in any of the Company's securities shall have been
suspended or limited by the Commission or by the Nasdaq National Market, or
trading in securities generally on either the Nasdaq Stock Market or the New
York Stock Exchange shall have been suspended or limited, or minimum or
maximum prices shall have been generally established on any of such stock
exchanges by the Commission, the NASD or any other governmental authority;
(ii) a general banking moratorium shall have been declared by any of federal,
New York, Delaware or California authorities; (iii) there shall have occurred
any outbreak or escalation of national or international hostilities or any
crisis or calamity, or any material adverse change in the United States or
international financial markets, or any substantial change or development
involving a prospective substantial change in United States' or international
political, financial or economic conditions, as in the judgment of the
Representatives is material and adverse and makes it impracticable to market
the Common Shares in the manner and on the terms described in the Prospectus
or to enforce contracts for the sale of securities; (iv) in the judgment of
the Representatives there shall have occurred any Material Adverse Change; or
(v) the Company shall have sustained a loss by strike, fire, flood,
earthquake, accident or other calamity of such character as in the judgment
of the Representatives may interfere materially with the conduct of the
business and operations of the Company regardless of whether or not such loss
shall have been insured. Any termination pursuant to this Section 11 shall be
without liability on the part of (a) the Company and the Selling Stockholder
to any Underwriter, except that the Company shall be obligated to reimburse
the expenses of the Representatives and the Underwriters pursuant to Sections
4 and 6 hereof, (b) any Underwriter to the Company and the Selling
Stockholder, or (c) of any party hereto to any other party except that the
provisions of Section 8 and Section 9 shall at all times be effective and
shall survive such termination.
25
SECTION 12. REPRESENTATIONS AND INDEMNITIES TO SURVIVE DELIVERY. The
respective indemnities, agreements, representations, warranties and other
statements of the Company (including its subsidiaries), of its officers, of
the Selling Stockholder and of the several Underwriters set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless
of any investigation made by or on behalf of any Underwriter or the Company
or any of its or their partners, officers or directors or any controlling
person, or the Selling Stockholder, as the case may be, and will survive
delivery of and payment for the Common Shares sold hereunder and any
termination of this Agreement.
SECTION 13. DEFAULT BY THE COMPANY. If the Company shall fail on the
First Closing Date to sell the number of Common Shares that it is obligated
to sell hereunder, then this Agreement shall terminate without any liability
on the part of any nondefaulting party; PROVIDED, HOWEVER, that the
provisions of Sections 4, 8, 9 and 12 shall remain in full force and effect.
No action taken pursuant to this Section 13 shall relieve the Company from
liability, if any, in respect of such default.
SECTION 14. NOTICES. All communications hereunder shall be in
writing and shall be mailed, hand delivered or telecopied and confirmed to
the parties hereto as follows:
If to the Representatives:
Banc of America Securities LLC
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Revell Horsey
With a copy to:
Banc of America Securities LLC
▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Esq.
And with a copy to:
Mintz, Levin, Cohn, Ferris,
Glovsky and Popeo, P.C.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ III, Esq.
If to the Company:
Regeneration Technologies, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
26
With a copy to:
Fulbright & ▇▇▇▇▇▇▇▇, L.L.P.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
If to the Selling Stockholder:
University of Florida Research Foundation, Inc.
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: _______________________
Attention: _______________________
With a copy to:
Dean, Mead, Egerton, Bloodworth, Capouano & ▇▇▇▇▇▇▇, P.A.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Any party hereto may change the address for receipt of communications by
giving written notice to the others.
SECTION 15. SUCCESSORS. This Agreement will inure to the benefit of
and be binding upon the parties hereto, including any substitute Underwriters
pursuant to Section 10 hereof, and to the benefit of the employees, officers
and directors and controlling persons referred to in Section 8 and Section 9,
and in each case their respective successors, and no other person will have
any right or obligation hereunder. The term "successors" shall not include
any purchaser of the Common Shares as such from any of the Underwriters
merely by reason of such purchase.
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. GOVERNING LAW PROVISIONS.
(a) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE.
(b) CONSENT TO JURISDICTION. Any legal suit, action or proceeding
arising out of or based upon this Agreement or the transactions contemplated
hereby ("Related Proceedings") may be instituted in the federal courts of the
United States of America located in the City and County of San Francisco or
the courts of the State of California in each case located in the City and
County of San Francisco
27
(collectively, the "Specified Courts"), and each party irrevocably submits to
the exclusive jurisdiction (except for proceedings instituted in regard to
the enforcement of a judgment of any such court (a "Related Judgment"), as to
which such jurisdiction is non-exclusive) of such courts in any such suit,
action or proceeding. Service of any process, summons, notice or document by
mail to such party's address set forth above shall be effective service of
process for any suit, action or other proceeding brought in any such court.
The parties irrevocably and unconditionally waive any objection to the laying
of venue of any suit, action or other proceeding in the Specified Courts and
irrevocably and unconditionally waive and agree not to plead or claim in any
such court that any such suit, action or other proceeding brought in any such
court has been brought in an inconvenient forum.
(c) WAIVER OF IMMUNITY. With respect to any Related Proceeding, each
party irrevocably waives, to the fullest extent permitted by applicable law,
all immunity (whether on the basis of sovereignty or otherwise) from
jurisdiction, service of process, attachment (both before and after judgment)
and execution to which it might otherwise be entitled in the Specified
Courts, and with respect to any Related Judgment, each party waives any such
immunity in the Specified Courts or any other court of competent
jurisdiction, and will not raise or claim or cause to be pleaded any such
immunity at or in respect of any such Related Proceeding or Related Judgment,
including, without limitation, any immunity pursuant to the United States
Foreign Sovereign Immunities Act of 1976, as amended.
SECTION 18. FAILURE OF THE SELLING STOCKHOLDER TO SELL AND DELIVER
COMMON SHARES. If the Selling Stockholder shall fail to sell and deliver to
the Underwriters the Common Shares to be sold and delivered by the Selling
Stockholder at the First Closing Date, pursuant to this Agreement, then the
Underwriters may at their option, by written notice from the Representative
to the Company and the Selling Stockholder, either (i) terminate this
Agreement without any liability on the part of any Underwriter and, except as
provided in Sections 4, 6, 8 and 9 hereof, the Company or the Selling
Stockholder, or (ii) purchase the shares which the Company has agreed to sell
and deliver in accordance with the terms hereof. If the Selling Stockholder
shall fail to sell and deliver to the Underwriters the Common Shares to be
sold and delivered by the Selling Stockholder pursuant to this Agreement at
the First Closing Date, then the Underwriters shall have the right, by
written notice from the Representative to the Company and the Selling
Stockholder, to postpone such Closing Date, but in no event for longer than
seven days in order that the required changes, if any, to the Registration
Statement and the Prospectus or any other documents or arrangements may be
effected.
SECTION 19. GENERAL PROVISIONS. 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. This Agreement may be
executed in two or more counterparts, each one of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the
same instrument. This Agreement may not be amended or modified unless in
writing by all of the parties hereto, and no condition herein (express or
implied) may be waived unless waived in writing by each party whom the
condition is meant to benefit. The Table of Contents and the Section headings
herein are for the convenience of the parties only and shall not affect the
construction or interpretation of this Agreement.
Each of the parties hereto acknowledges that it is a sophisticated
business person who was adequately represented by counsel during negotiations
regarding the provisions hereof, including, without limitation, the
indemnification provisions of Section 8 and the contribution provisions of
Section 9, and is fully informed regarding said provisions. Each of the
parties hereto further acknowledges that the provisions of Sections 8 and 9
hereto fairly allocate the risks in light of the ability of the parties to
investigate the Company, its affairs and its business in order to assure that
adequate disclosure has been made in the Registration Statement, any
preliminary prospectus and the Prospectus (and any amendments and supplements
thereto), as required by the Securities Act and the Exchange Act.
28
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to the Company and the Selling Stockholder
the enclosed copies hereof, whereupon this instrument, along with all
counterparts hereof, shall become a binding agreement in accordance with its
terms.
Very truly yours,
REGENERATION TECHNOLOGIES, INC.
By:
--------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Executive Officer
UNIVERSITY OF FLORIDA RESEARCH
FOUNDATION, INC.
By:
--------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Attorney-in-Fact
The foregoing Underwriting Agreement is hereby confirmed and accepted by the
Representatives in San Francisco, California as of the date first above
written.
BANC OF AMERICA SECURITIES LLC
▇▇▇▇▇▇ BROTHERS INC.
▇▇▇▇▇▇▇▇ INC.
Acting as Representatives of the
several Underwriters named in
the attached Schedule A.
By: BANC OF AMERICA SECURITIES LLC
By:
-------------------------------------------------
Name:
--------------------------------------------
Title:
--------------------------------------------
29
SCHEDULE A
SCHEDULE OF UNDERWRITERS
NUMBER OF
FIRM COMMON SHARES
TO BE PURCHASED
UNDERWRITERS
Banc of America Securities LLC [___]
▇▇▇▇▇▇ Brothers Inc. [___]
▇▇▇▇▇▇▇▇ Inc. [___]
[____________________________] [___]
TOTAL [___]
EXHIBIT A
FORM OF OPINION OF COUNSEL FOR THE COMPANY
THE FINAL OPINION IN DRAFT FORM SHOULD BE ATTACHED AS EXHIBIT A AT THE TIME
THIS AGREEMENT IS EXECUTED.
Opinion of counsel for the Company to be delivered pursuant to
Section 5(d) of the Underwriting Agreement.
References to the Prospectus in this EXHIBIT A include any
supplements thereto at the First Closing Date and the Second Closing Date.
(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware.
(ii) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into and perform its obligations under the
Underwriting Agreement.
(iii) The Company is duly qualified as a foreign corporation to
transact business and is in good standing in the State of Florida.
(iv) Each subsidiary of the Company listed on Exhibit 21 to the
Registration Statement has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the Prospectus.
(v) All of the issued and outstanding capital stock of each such
significant subsidiary of the Company has been duly authorized and validly
issued, is fully paid and non-assessable and, to the best knowledge of such
counsel, is owned by the Company, directly or through subsidiaries, free
and clear of any security interest, mortgage, pledge, lien, encumbrance or,
to the best knowledge of such counsel, any pending or threatened claim.
(vi) The authorized, issued and outstanding capital stock of the
Company (including the Common Shares) conform in all material respects to
the descriptions thereof set forth in the Prospectus under the heading
"Description of Capital Stock." All of the outstanding shares of Common
Stock (including the shares of Common Stock owned by the Selling
Stockholder) have been duly authorized and validly issued, are fully paid
and nonassessable and, to the best of such counsel's knowledge, have been
issued in compliance with the registration and qualification requirements
of federal securities laws. The form of certificate used to evidence the
Common Stock is in due and proper form and complies with all applicable
requirements of the charter and by-laws of the Company and the General
Corporation Law of the State of Delaware.
(vii) No stockholder of the Company or any other person has any
preemptive right, right of first refusal or other similar right which has
not been waived to subscribe for or purchase securities of the Company
arising (i) by operation of the charter or by-laws of the Company or the
General Corporation Law of the State of Delaware or (ii) to the best
knowledge of such counsel, pursuant to any agreement filed as an exhibit to
the Registration Statement.
A-1
(viii) The Underwriting Agreement has been duly authorized, executed
and delivered by the Company.
(ix) The Common Shares to be purchased by the Underwriters from the
Company have been duly authorized for issuance and sale pursuant to the
Underwriting Agreement and, when issued and delivered by the Company
pursuant to the Underwriting Agreement against payment of the consideration
set forth therein, will be validly issued, fully paid and nonassessable
and, to the knowledge of such counsel, the issuance of the Common Shares by
the Company is not subject to any preemptive or similar rights.
(x) Each of the Registration Statement and the Rule 462(b) Registration
Statement, if any, has been declared effective by the Commission under the
Securities Act. To the best knowledge of such counsel, no stop order
suspending the effectiveness of either of the Registration Statement or the
Rule 462(b) Registration Statement, if any, has been issued under the
Securities Act and no proceedings for such purpose have been instituted or
are pending or are contemplated or threatened by the Commission. Any
required filing of the Prospectus and any supplement thereto pursuant to
Rule 424(b) under the Securities Act has been made in the manner and within
the time period required by such Rule 424(b).
(xi) The Registration Statement, including any Rule 462(b) Registration
Statement, the Prospectus, and each amendment or supplement to the
Registration Statement and the Prospectus, as of their respective effective
or issue dates (other than the financial statements and supporting
schedules included or incorporated by reference therein or in exhibits to
or excluded from the Registration Statement, as to which no opinion need be
rendered) comply as to form in all material respects with the applicable
requirements of the Securities Act.
(xii) The Common Shares have been approved for quotation on the Nasdaq
National Market.
(xiii) The statements (i) in the Prospectus under the captions "Risk
Factors--Provisions of our governing documents and Delaware law. . .",
"Description of Capital Stock", "Management-Omnibus Stock Option Plan",
"Related Party Transactions," "Shares Eligible for Future Sale," and
"Underwriting" and (ii) Item 14 of the Registration Statement, insofar as
such statements constitute matters of law, summaries of legal matters, the
Company's charter or by-law provisions, documents or legal proceedings, or
legal conclusions, has been reviewed by such counsel and, to the best
knowledge of such counsel, fairly present and summarize, in all material
respects, the matters referred to therein.
(xiv) To the best knowledge of such counsel, there are no legal or
governmental actions, suits or proceedings pending to which the Company,
its directors, officers or properties is a party or threatened against any
of the foregoing which are required to be disclosed in the Registration
Statement, other than those disclosed therein.
(xv) To the best knowledge of such counsel, there are no Existing
Instruments required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto other than those described or
referred to therein or filed or incorporated by reference as exhibits
thereto; and the descriptions thereof and references thereto are correct in
all material respects.
(xvi) No consent, approval, authorization or other order of, or
registration or filing with, any court or other governmental authority or
agency, is required for the Company's execution, delivery
A-2
and performance of the Underwriting Agreement and consummation of the
transactions contemplated thereby and by the Prospectus, except as have
been obtained or as are required under the Securities Act, applicable state
securities or blue sky laws and from the NASD.
(xvii) The execution and delivery of the Underwriting Agreement by the
Company and the performance by the Company of its obligations thereunder
(other than performance by the Company of its obligations under the
indemnification section of the Underwriting Agreement, as to which no
opinion need be rendered) (i) have been duly authorized by all necessary
corporate action on the part of the Company; (ii) will not result in any
violation of the provisions of the charter or by-laws of the Company or any
subsidiary; (iii) will not constitute a breach of, or Default or Repayment
Event under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to any document filed as an exhibit to the
Registration Statement; or (iv) to the best knowledge of such counsel, will
not result in any violation of any law, administrative regulation or
administrative or court decree known to such counsel which is applicable to
the Company or any subsidiary.
(xviii) The Company is not, and will not become, as a result of and at
the consummation of the sale of the Common Shares, an "investment company"
required to be registered under the Investment Company Act.
(xix) Except as disclosed in the Prospectus under the caption "Shares
Eligible for Future Sale," to the best knowledge of such counsel, there are
no persons with registration or other similar rights to have any equity or
debt securities registered for sale under the Registration Statement or
included in the offering contemplated by the Underwriting Agreement, except
for such rights as have been duly waived.
(xx) Nothing has come to our attention which could cause us to believe
that either the Company or any subsidiary is in violation of its charter or
by-laws or any law, administrative regulation or administrative or court
decree applicable to the Company or any subsidiary or is in Default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any document filed as an exhibit to the Registration
Statement, except in each such case for such violations or Defaults as
would not, individually or in the aggregate, result in a Material Adverse
Change.
We have participated in reviews and discussions with officers and
other representatives of the Company in connection with the preparation of
the Registration Statement and the Prospectus, in the course of which reviews
and discussions the contents of the Registration Statement and the Prospectus
and related matters were discussed, and although we have not independently
verified the various statements of fact contained in the Registration
Statement and the Prospectus, and accordingly are not passing thereon, we
have no reason to believe that (A) the Registration Statement (except as to
the financial statements and other financial data included therein or omitted
therefrom, as to which we express no opinion), on the Effective Date,
contained any untrue statement of a material fact required to be stated
therein, or omitted to state any material fact required to be stated therein
or necessary to make the statements therein in light of the circumstances
under which they were made not misleading, or (B) the Prospectus (except as
to the financial statements and other financial data included therein or
omitted therefrom, as to which we express no opinion), as of its date of the
date hereof, contained or contains any untrue statement of a material fact or
omitted or omits 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. There is no assurance that all material facts were disclosed
to us or that our familiarity with the Company
A-3
is such that we have necessarily recognized the materiality of such facts as
were disclosed to us, and we have relied to a large extent upon the
statements of representatives of the Company as to the materiality of the
facts disclosed to us. We are not passing upon and do not assume any
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement or the Prospectus, except to the
extent expressly set forth in paragraph (xiii) above.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the General
Corporation Law of the State of Delaware, the General Corporation Law of the
State of New York or the federal law of the United States, to the extent they
deem proper and specified in such opinion, upon the opinion (which shall be
dated the First Closing Date or the Second Closing Date, as the case may be,
shall be satisfactory in form and substance to the Underwriters, shall
expressly state that the Underwriters may rely on such opinion as if it were
addressed to them and shall be furnished to the Representative) of other
counsel of good standing whom they believe to be reliable and who are
satisfactory to counsel for the Underwriters; PROVIDED, HOWEVER, that such
counsel shall further state that they believe that they and the Underwriters
are justified in relying upon such opinion of other counsel, and (B) as to
matters of fact, to the extent they deem proper, on certificates of
responsible officers of the Company and public officials.
▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF OPINION OF INTELLECTUAL PROPERTY COUNSEL FOR THE COMPANY
THE FINAL OPINION IN DRAFT FORM SHOULD BE ATTACHED AS EXHIBIT A-1 AT THE TIME
THIS AGREEMENT IS EXECUTED.
Opinion of intellectual property counsel for the Company pursuant to
Section 5(e) of the Underwriting Agreement.
References to the Prospectus in this EXHIBIT A-1 include any
supplements thereto at the First Closing Date and the Second Closing Date.
Dear Sirs:
At the request of Regeneration Technologies, Inc. (the "Company"),
to which Company this firm acts as patent counsel, we provide the following
opinion as to such patent matters and subject to the terms and conditions
stated herein:.
a. We have disclosed or intend to disclose to the United States
Patent and Trademark Office any references known by us to be material to the
patentability of the claimed inventions of the United States patent
applications of the Company being prosecuted by us listed on Schedule A in
accordance with 37 C.F.R. ss. 1.56.
b. According to the records of the United States Patent and
Trademark Office ("PTO"), and to our knowledge, the Company is the sole
assignee of each of the United States patent applications of the Company
being prosecuted by us listed on Schedule A hereto for which a serial number
has been issued and which have a searchable record in the PTO's assignment
database; or to our knowledge all inventors on such patent applications are
under an obligation to assign all of their rights in such applications to the
Company, except for the cases listed on Schedule B hereto.
c. To our knowledge, the Company has not received any notice of
infringement with respect to any patent, trademark or copyright or any notice
of misappropriation of trade secrets.
d. Based on our knowledge of the Company's processes and the conduct
of its business as described to us by the Company, the Company is not
violating any patent, trademark or copyright or trade secret or other
proprietary right of a third party which we are aware of, or which the
Company has brought to our attention, or which we have reviewed during
prosecution of the patent applications listed on Schedule A; and this firm
has no reason to believe that the Company does not possess or own adequate
licenses or other rights to conduct the business now being conducted by the
Company as described in the Prospectus.
e. We are not aware of any pending or threatened legal or
governmental proceedings relating to patent rights, copyrights trademark
rights, trade secrets, or other proprietary rights of the Company (other than
the prosecution of patent or trademark proceedings themselves), except for
those listed on Schedule C hereto.
f. To the best of our knowledge, the statements under the captions
"Risk Factors - Patents and Proprietary Rights; Third Party Rights" and
"Business - Intellectual Property", insofar as such matters
A-1-1
constitute matters of law or legal conclusions are accurate and correct in
all material respects and fairly present such matters.
g. With respect to United States patent, trademark, copyright and
trade secret matters, nothing has come to our attention which would lead us
to believe that the sections of the Offering Memorandum entitled "Risk
Factors--Patents and Proprietary Rights; Third Party Rights" and "Business--
Intellectual Property," as of the date thereof and at any Delivery Date,
contain any untrue statement of material fact or omits to state a material
fact required to be stated therein or necessary to make the statements
therein, not misleading.
Very truly yours,
▇▇▇▇▇▇ ▇. Bencen, Esq.
A-1-2
EXHIBIT A-2
FORM OF OPINION OF REGULATORY COUNSEL FOR THE COMPANY
THE FINAL OPINION IN DRAFT FORM SHOULD BE ATTACHED AS EXHIBIT A-2 AT THE
TIME THIS AGREEMENT IS EXECUTED.
Opinion of regulatory counsel for the Company pursuant to Section 5(f)
of the Underwriting Agreement.
References to the Prospectus in this EXHIBIT A-2 include any
supplements thereto at the First Closing Date and the Second Closing Date.
Banc of America Securities LLC
▇▇▇▇▇▇ Brothers Inc.
▇▇▇▇▇▇▇▇ Inc.
As Representatives of the several Underwriters
c/o Banc of America Securities LLC
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
This letter is furnished to you pursuant to Section 5(f) of the
Underwriting Agreement dated August 9, 2000 (the "Underwriting Agreement")
between you and Regeneration Technolgies, Inc. (the "Company") relating to a
public offering and sale of 5,700,000 shares of Company common stock, par
value $.001 per share (the "Shares"). As used herein, the terms "Registration
Statement" and "Prospectus" have the meanings assigned thereto in the
Underwriting Agreement.
We have acted as counsel to the Company with respect to certain United
States Food and Drug Administration ("FDA") regulatory matters. As such, we
are generally familiar with the Company's business. In our capacity as FDA
regulatory counsel to the Company, we have reviewed at your request those
portions of the Registration Statement and the Prospectus set forth under the
captions "Risk Factors" - "Our allografts could become subject to
significantly greater regulation by the FDA, which could disrupt our
business" and "If we fail to achieve and maintain the high processing and
manufacturing standards that our allografts require or if we are unable to
develop additional manufacturing capacities, our commercial opportunity will
be reduced or eliminated", "Business", "Tissue Recovery" and "Government
Regulation" (collectively, the "Regulatory Disclosure").
In connection with rendering this opinion, our inquiry has been limited
to examination of originals, or copies identified as being true copies of
originals, of the Registration Statement, the Prospectus, and pages 5-6 of
the Underwriting Agreement.
We have not made any independent review or investigation of factual or
other matters, including the assets, business or affairs of the Company. We
have assumed the authenticity, accuracy and completeness of the foregoing
documents, on which we are relying, and have made no independent
investigations thereof. Further, we state that we have not independently
verified, do not take any responsibility for, and do not express any opinion
as to: (i) any statements of fact, (ii) any statements concerning state or
foreign law, (iii) any legal conclusions or any statements of belief
attributed to the
A-2-1
Company, or (iv) the compliance by the Company or any Subsidiary with
applicable FDA or other legal requirements. This opinion is given in the
context of the foregoing.
Based solely on the inquiry described herein and subject to the
limitations set forth above, we are of the opinion that the statements in the
Regulatory Disclosure, insofar as such statements purport to describe or
summarize applicable provisions of the Federal Food, Drug, and Cosmetic Act
("FDCA") and the regulations promulgated thereunder, are accurate and
complete in all material respects and fairly present the information
purported to be described therein, and based upon our knowledge of the
Company such statements summarize the provisions of the FDCA that are
material to the Company's business.
Based solely on the inquiry described herein and subject to the
limitations set forth above, we are of the opinion that the statements in the
Regulatory Disclosure are accurate in all material respects and fairly
present the information purported to be described therein.
Except as set forth above, we are not passing upon, and we assume no
responsibility for, the accuracy or completeness of the Regulatory
Disclosure. However, we inform you that, in the course of our representation
of the Company on matters as to which we have been consulted from time to
time in our capacity as FDA counsel, no information has come to our attention
that causes us to believe the Registration Statement or Prospectus, as of the
date they were declared effective, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading. We are
not commenting on any portion of the Registration Statement or the Prospectus
other than the Regulatory Disclosure.
Based solely on the inquiry described herein and subject to the
limitations set forth above, we are not aware of any lawsuit or regulatory
proceeding, pending or threatened, brought by or before the FDA, in which the
Company is or would be the defendant or respondent, except as described in
the Prospectus.
The opinion is rendered to you solely in your capacity as Representatives
of the Underwriters and solely in connection with the offer and sale by the
Company of the Shares to the Underwriters pursuant to the Underwriting
Agreement on the date hereof, and may not be relied upon by any person or for
any other purpose without our prior written consent. We assume no obligation
to advise you of any facts or circumstances, or any changes in law, that may
come to our attention subsequent to the date hereof.
Sincerely yours,
▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, P.C.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF OPINION OF COUNSEL FOR THE SELLING STOCKHOLDER
THE FINAL OPINION IN DRAFT FORM SHOULD BE ATTACHED AS EXHIBIT A-3 AT THE TIME
THIS AGREEMENT IS EXECUTED.
Opinion of counsel for the Selling Stockholder to be delivered pursuant
to Section 5(l) of the Underwriting Agreement.
References to the Prospectus in this EXHIBIT A-3 include any supplements
thereto at the First Closing Date and the Second Closing Date
(i) The Underwriting Agreement has been duly authorized, executed and
delivered by or on behalf of, and is a valid and binding agreement of, the
Selling Stockholder, enforceable in accordance with its terms, except as
rights to indemnification thereunder may be limited by applicable law and
except as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting
creditors' rights generally or by general equitable principles.
(ii) The execution and delivery by the Selling Stockholder of, and the
performance by the Selling Stockholder of his obligations under, the
Underwriting Agreement, the Custody Agreement and the Power of Attorney will
not contravene or conflict with, result in a breach of, or constitute a
default under the charter or by-laws or other organizational documents, as
the case may be, of such Selling Stockholder, or, to the best of such
counsel's knowledge, violate or contravene any provision of any applicable
law or regulation, or of any judgment, order or decree applicable to the
Selling Stockholder of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over the Selling
Stockholder.
(iii) The Selling Stockholder has good and valid title to all of the
Common Shares which may be sold by the Selling Stockholder under the
Underwriting Agreement and has the legal right and power, and all
authorizations and approvals required under its charter and by-laws or other
organizational documents, as the case may be, to enter into the Underwriting
Agreement, the Custody Agreement and the Power of Attorney, to sell, transfer
and deliver all of the Common Shares which may sold by the Selling
Stockholder under the Underwriting Agreement and to comply with its other
obligations under the Underwriting Agreement, the Custody Agreement and the
Power of Attorney.
(iv) Each of the Custody Agreement and the Power of Attorney of the
Selling Stockholder has been duly authorized, executed and delivered by the
Selling Stockholder and is a valid and binding agreement of the Selling
Stockholder, enforceable in accordance with its terms, except as rights to
indemnification thereunder may be limited by applicable law and except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting creditors' rights
generally or by general equitable principles.
(v) Assuming that the Underwriters purchase the Common Shares which are
sold by the Selling Stockholder pursuant to the Underwriting Agreement for
value, in good faith and without notice of any adverse claim, the delivery of
such Common Shares pursuant to the Underwriting Agreement will pass good and
valid title to such Common Shares, free and clear of any security interest,
mortgage, pledge, lieu encumbrance or other claim.
A-3-1
(vi) To the best of such counsel's knowledge, no consent, approval,
authorization or other order of, or registration or filing with, any court or
governmental authority or agency, is required for the consummation by the
Selling Stockholder of the transactions contemplated in the Underwriting
Agreement, except as required under the Securities Act, applicable state
securities or blue sky laws, and from the NASD.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the General
Corporation Law of the State of Delaware, the General Corporation Law of the
State of Florida or the federal law of the United States, to the extent they
deem proper and specified in such opinion, upon the opinion (which shall be
dated the First Closing Date or the Second Closing Date, as the case may be,
shall be satisfactory in form and substance to the Underwriters, shall
expressly state that the Underwriters may rely on such opinion as if it were
addressed to them and shall be furnished to the Representative) of other
counsel of good standing whom they believe to be reliable and who are
satisfactory to counsel for the Underwriters; PROVIDED, HOWEVER, that such
counsel shall further state that they believe that they and the Underwriters
are justified in relying upon such opinion of other counsel, and (B) as to
matters of fact, to the extent they deem proper, on certificates of the
Selling Stockholder and public officials.
A-3-2
EXHIBIT B
FORM OF LOCK-UP AGREEMENT
Banc of America Securities LLC
▇▇▇▇▇▇ Brothers Inc.
▇▇▇▇▇▇▇▇ Inc.
As Representatives of the Several Underwriters
c/o Banc of America Securities LLC
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
RE: Regeneration Technologies, Inc. (the "Company")
Ladies & Gentlemen:
The undersigned is an owner of record or beneficially of certain
shares of Common Stock of the Company ("Common Stock") or securities
convertible into or exchangeable or exercisable for Common Stock. The Company
proposes to carry out a public offering of Common Stock (the "Offering") for
which you will act as the representatives of the underwriters. The
undersigned recognizes that the Offering will be of benefit to the
undersigned and will benefit the Company by, among other things, raising
additional capital for its operations. The undersigned acknowledges that you
and the other underwriters are relying on the representations and agreements
of the undersigned contained in this letter in carrying out the Offering and
in entering into underwriting arrangements with the Company with respect to
the Offering.
In consideration of the foregoing, the undersigned hereby agrees
that the undersigned will not, without the prior written consent of Banc of
America Securities LLC (which consent may be withheld in its sole
discretion), directly or indirectly, sell, offer, contract or grant any
option to sell (including without limitation any short sale), pledge,
transfer, establish an open "put equivalent position" within the meaning of
Rule 16a-1(h) under the Securities Exchange Act of 1934, or otherwise dispose
of any shares of Common Stock, options or warrants to acquire shares of
Common Stock, or securities exchangeable or exercisable for or convertible
into shares of Common Stock currently or hereafter owned either of record or
beneficially (as defined in Rule 13d-3 under the Securities Exchange Act of
1934, as amended) by the undersigned, or publicly announce the undersigned's
intention to do any of the foregoing, for a period commencing on the date
hereof and continuing to a date 180 days after the first date any of the
Common Stock to be sold in the Offering is released by you for sale to the
public. The undersigned also agrees and consents to the entry of stop
transfer instructions with the Company's transfer agent and registrar against
the transfer of shares of Common Stock or securities convertible into or
exchangeable or exercisable for Common Stock held by the undersigned except
in compliance with the foregoing restrictions.
B-1
This agreement is irrevocable and will be binding on the undersigned
and the respective successors, heirs, personal representatives, and assigns
of the undersigned.
Dated: __________________________________ , 2000
__________________________________________
Printed Name of Holder
By:_______________________________________
Signature
___________________________________________
Printed Name of Person Signing
(AND INDICATE CAPACITY OF PERSON SIGNING IF
SIGNING AS CUSTODIAN, TRUSTEE, OR ON BEHALF
OF AN ENTITY)
B-2