EXHIBIT 1.1
BANC OF AMERICA SECURITIES LLC
UNDERWRITING AGREEMENT
_______________ SHARES
ABIOMED, INC.
Common Stock
Underwriting Agreement
dated [___________ __], 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....................................................3
(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.........................................................................4
(i) PREPARATION OF THE FINANCIAL STATEMENTS.........................................................4
(j) INCORPORATION AND GOOD STANDING OF THE COMPANY AND ITS SUBSIDIARIES.............................4
(k) CAPITALIZATION AND OTHER CAPITAL STOCK MATTERS..................................................4
(l) NASDAQ NATIONAL LISTING.........................................................................5
(m) NON-CONTRAVENTION OF EXISTING INSTRUMENTS; NO FURTHER AUTHORIZATIONS OR APPROVALS REQUIRED......5
(n) COMPLIANCE WITH LAWS............................................................................5
(o) NO MATERIAL ACTIONS OR PROCEEDINGS..............................................................6
(p) INTELLECTUAL PROPERTY RIGHTS....................................................................6
(q) ALL NECESSARY PERMITS, ETC......................................................................6
(r) TITLE TO PROPERTIES.............................................................................7
(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......................................................................8
(x) NO UNLAWFUL CONTRIBUTIONS OR OTHER PAYMENTS.....................................................8
(y) COMPANY'S ACCOUNTING SYSTEM.....................................................................8
(z) COMPLIANCE WITH ENVIRONMENTAL LAWS..............................................................8
(AA) ERISA COMPLIANCE.........................................................................9
(BB) YEAR 2000................................................................................9
(CC) LOCK-UP AGREEMENTS.......................................................................9
(DD) EXCHANGE ACT COMPLIANCE..................................................................9
B. REPRESENTATIONS AND WARRANTIES OF THE SELLING STOCKHOLDER...............................................10
(a) THE UNDERWRITING AGREEMENT.....................................................................10
(b) THE CUSTODY AGREEMENT AND POWER OF ATTORNEY....................................................10
(c) TITLE TO COMMON SHARES TO BE SOLD; ALL AUTHORIZATIONS OBTAINED.................................10
(d) DELIVERY OF THE COMMON SHARES TO BE SOLD.......................................................10
(e) NON-CONTRAVENTION; NO FURTHER AUTHORIZATIONS OR APPROVALS REQUIRED.............................10
(f) NO FURTHER CONSENTS, ETC.......................................................................11
(g) DISCLOSURE MADE BY THE SELLING STOCKHOLDER IN THE PROSPECTUS...................................11
(h) NO PRICE STABILIZATION OR MANIPULATION.........................................................11
(i) CONFIRMATION OF COMPANY REPRESENTATIONS AND WARRANTIES.........................................11
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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............................................12
(d) PUBLIC OFFERING OF THE COMMON SHARES...........................................................12
(e) PAYMENT FOR THE COMMON SHARES..................................................................12
(f) DELIVERY OF THE COMMON SHARES..................................................................13
(g) DELIVERY OF PROSPECTUS TO THE UNDERWRITERS.....................................................13
SECTION 3. ADDITIONAL COVENANTS.................................................................................13
A. ADDITIONAL CONVENANTS OF THE COMPANY....................................................................13
(a) REPRESENTATIVES'REVIEW OF PROPOSED AMENDMENTS AND SUPPLEMENTS..................................13
(b) SECURITIES ACT COMPLIANCE......................................................................14
(c) AMENDMENTS AND SUPPLEMENTS TO THE PROSPECTUS AND OTHER SECURITIES ACT MATTERS..................14
(d) COPIES OF ANY AMENDMENTS AND SUPPLEMENTS TO THE PROSPECTUS.....................................14
(e) BLUE SKY COMPLIANCE............................................................................14
(f) USE OF PROCEEDS................................................................................15
(g) TRANSFER AGENT.................................................................................15
(h) QUOTATION......................................................................................15
(i) EARNINGS STATEMENT.............................................................................15
(j) PERIODIC REPORTING OBLIGATIONS.................................................................15
(k) AGREEMENT NOT TO OFFER OR SELL ADDITIONAL SECURITIES...........................................15
(l) FUTURE REPORTS TO THE REPRESENTATIVES..........................................................15
(m) EXCHANGE ACT COMPLIANCE........................................................................16
B. COVENANT OF THE SELLING STOCKHOLDER.....................................................................16
SECTION 4. PAYMENT OF EXPENSES..................................................................................16
SECTION 5. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS....................................................17
(a) ACCOUNTANTS'COMFORT LETTER.....................................................................17
(b) COMPLIANCE WITH REGISTRATION REQUIREMENTS; NO STOP ORDER; NO OBJECTION FROM NASD...............17
(c) NO MATERIAL ADVERSE CHANGE.....................................................................18
(d) OPINION OF COUNSEL FOR THE COMPANY AND THE SELLING STOCKHOLDER.................................18
(e) OPINION OF INTELLECTUAL PROPERTY COUNSEL FOR THE COMPANY.......................................18
(f) OPINION OF COUNSEL FOR THE UNDERWRITERS........................................................18
(g) OFFICERS'CERTIFICATE...........................................................................18
(h) SECRETARY'S CERTIFICATE........................................................................19
(i) BRING-DOWN COMFORT LETTER......................................................................19
(j) LOCK-UP AGREEMENT FROM CERTAIN SECURITYHOLDERS OF THE COMPANY..................................19
(k) SELLING STOCKHOLDER'S CERTIFICATE..............................................................19
(l) SELLING STOCKHOLDER'S DOCUMENTS................................................................19
(m) ADDITIONAL DOCUMENTS...........................................................................19
SECTION 6. REIMBURSEMENT OF UNDERWRITERS'EXPENSES...............................................................20
SECTION 7. EFFECTIVENESS OF THIS AGREEMENT......................................................................20
SECTION 8. INDEMNIFICATION......................................................................................20
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(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.............................................23
(e) SETTLEMENTS....................................................................................23
(f) LIMITATION ON LIABILITY OF THE SELLING STOCKHOLDER.............................................24
SECTION 9. CONTRIBUTION.........................................................................................24
SECTION 10. DEFAULT OF ONE OR MORE OF THE SEVERAL UNDERWRITERS...................................................25
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.............................................................................28
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
SCHEDULE B SCHEDULE OF COMPANY PATENTS AND TRADEMARKS
SCHEDULE C SCHEDULE OF PERSONS AND ENTITIES SUBJECT TO LOCK-UP
AGREEMENT
EXHIBITS
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EXHIBIT A FORM OF OPINION OF COUNSEL FOR THE COMPANY AND THE SELLING
STOCKHOLDER
EXHIBIT A-1 FORM OF OPINION OF INTELLECTUAL PROPERTY COUNSEL FOR THE COMPANY
EXHIBIT B FORM OF LOCK-UP AGREEMENT
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UNDERWRITING AGREEMENT
[________ __], ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ SECURITIES LLC
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
As Representatives of the several Underwriters
c/o BANC OF AMERICA SECURITIES LLC
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
INTRODUCTORY. ABIOMED, Inc., a Delaware corporation (the "Company"),
proposes to issue and sell to the several underwriters named in SCHEDULE A (the
"Underwriters") an aggregate of [___] shares (the "Firm Common Shares") of its
Common Stock, par value $.01 per share (the "Common Stock"). In addition, the
Company has granted to the Underwriters an option to purchase up to an
additional [___] shares (the "Company Optional Common Shares") and ▇▇. ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇ (the "Selling Stockholder") has granted to the Underwriters an option
to purchase up to an additional 100,000 shares (the "Selling Stockholder
Optional Common Shares" and together with the Company Optional Common 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") and ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney 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-3 (File No.
333-93033), 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 and the rules and regulations promulgated thereunder
(collectively, the "Securities Act"), including all documents incorporated or
deemed to be incorporated by reference therein and any information deemed to be
a part thereof under the Securities Act or the Securities Exchange Act of 1934
and the rules and regulations promulgated thereunder (collectively, the
"Exchange Act") 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
February [ ], 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 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 ("▇▇▇▇▇").
All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in the
Registration Statement or the Prospectus (and all other references of like
import) shall be deemed to mean and include all such financial statements and
schedules and other information which is or is deemed to be incorporated by
reference in the Registration Statement or the Prospectus, as the case may be;
and all references in this Agreement to amendments or supplements to the
Registration Statement or the Prospectus shall be deemed to mean and include the
filing of any document under the Exchange Act which is or is deemed to be
incorporated by reference in the Registration Statement or the Prospectus, as
the case may be.
The Company hereby confirms its 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, as
amended or supplemented, 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 Representatives 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 each 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,
2
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.
(c) DISTRIBUTION OF OFFERING MATERIAL BY THE COMPANY. Except with the
prior written consent of the Representatives, 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 or contribution 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 solely 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 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. To the best of the Company's knowledge,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 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
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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 statements and supporting
schedules have been prepared in conformity with generally accepted accounting
principles as applied in the United States applied on a consistent basis
throughout the periods involved, except as may be expressly stated in the
related notes thereto. 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 Commonwealth
of Massachusetts) 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 Company's
Annual Report on Form 10-K for the fiscal year ended March 31, 1999.
(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 or upon exercise of
outstanding options). 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 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 set forth in or contemplated by the Prospectus and the
financial statements and related notes thereto.
(l) NASDAQ NATIONAL LISTING. The Common Stock (including the Common
Shares) is registered pursuant to Section 12(g) of the Exchange Act and is
listed on the Nasdaq National Market, and the Company has taken no action
designed to, or likely to have the effect of, terminating the registration
4
of the Common Stock under the Exchange Act or delisting the Common Stock from
the Nasdaq National Market, nor has the Company received any notification that
the Commission or the National Association of Securities Dealers, Inc. ("NASD")
is contemplating terminating such registration or listing.
(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 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 bank line of credit, demand loans or term
loans with Fleet National Bank, as lender), 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 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 accelerate 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 might 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
5
its subsidiaries, or 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.
(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 including specifically, but without limitation, the patents and
trademarks listed on SCHEDULE B (collectively, "Intellectual Property Rights")
necessary to conduct their businesses as now conducted; and the Company believes
that the expected expiration of any of such Intellectual Property Rights would
not result in a Material Adverse Change. Except as otherwise disclosed in the
Prospectus, 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 notice of any facts or circumstances
which would render any Intellectual Property Rights invalid and which
infringement or conflict, if the subject of an unfavorable decision, would
result in a Material Adverse Change. The Company is unaware of any facts that
would lead it to believe that it or any of its subsidiaries infringe the
intellectual property rights of any third party, except as otherwise disclosed
in the Prospectus. The Company has good and marketable title to the patents and
patent applications referenced in the Prospectus. It is Company policy for the
Company and its subsidiaries to enter into valid and binding confidentiality,
non-disclosure and assignment of inventions agreements with all key employees,
consultants, vendors and other third parties with authorized access to the
Company's or its subsidiaries' Intellectual Property Rights. The Company has
complied with this policy except where the failure to comply has not, and is not
likely to have, singly or in the aggregate, a Material Adverse Effect. To the
Company's knowledge, 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. Except as otherwise disclosed in the
Prospectus, the Company and each subsidiary possess such valid and current
certificates, authorizations or permits issued by the appropriate state, federal
or foreign regulatory agencies or bodies (including without limitation, the U.S.
Food and Drug Administration), and has made all filings required under any
state, federal or foreign law, regulation or rule, necessary to conduct their
respective businesses as now conducted (except for any of the foregoing the
absence of which would not, singly or in the aggregate, result in a Material
Adverse Change); the Company and its subsidiaries are in compliance with the
terms and conditions of all such certificates, authorizations and permits,
except where the failure to so comply which would not, singly or in the
aggregate, 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
certificate, authorization or permit 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 tangible 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 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 that has been asserted by
6
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.
(s) TAX LAW COMPLIANCE. The Company and its subsidiaries have filed all
necessary federal, state and foreign income and franchise tax returns 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(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
7
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 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 the
terms and conditions of any permits or other governmental authorizations
required for the operation of the business of the Company or its subsidiaries
under applicable Environmental Laws, 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 knowingly retained or assumed; (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 knowingly retained or assumed.
(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
8
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.
(bb) YEAR 2000. The Company has not incurred significant operating
expenses or costs to ensure that its information systems will be year 2000
compliant, other than as disclosed in the Prospectus.
(cc) LOCK-UP AGREEMENTS. The Company has caused each person listed on
SCHEDULE C hereto to furnish to you, on or prior to the date of this agreement,
a letter or letters, substantially in the form of EXHIBIT C hereto (the "Lock-Up
Agreement"), pursuant to which each such person shall have agreed that during a
period of ninety (90) days after the first date any of the Common Stock to be
sold in the public offering 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.
(dd) EXCHANGE ACT COMPLIANCE. The documents incorporated or deemed to
be incorporated by reference in the Prospectus, at the time they were or
hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the Exchange Act, and, when read
together with the other information in the Prospectus, at the time the
Registration Statement and any amendments thereto become effective and at the
First Closing Date and the Second Closing Date, as the case may be, will 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 fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
Any certificate signed by an officer of the Company and delivered to
the Representatives or to counsel for the Underwriters at the First Closing Date
or the Second Closing Date, as the case may be, 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 or contribution 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 such Selling Stockholder (the "Custody Agreement") and (ii) Power of
Attorney appointing certain individuals named therein as the Selling
Stockholder's
9
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 or contribution 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 and the Second Closing
Date (as defined below), as applicable, will have, valid and unencumbered 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 any trust agreement or
other 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 his other obligations hereunder and thereunder.
(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 valid and unencumbered 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, any agreement to which the Selling Stockholder is a party or by
which he is bound or under which he 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 FURTHER CONSENTS, ETC. No consent, approval or waiver is
required under any agreement to which the Selling Stockholder is a party or by
which he is bound or under which he 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.
(g) 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 Stockholders" (prior to giving effect to the sale
of the Common Shares).
10
(h) 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.
(i) CONFIRMATION OF COMPANY REPRESENTATIONS AND WARRANTIES. To the
knowledge of the Selling Stockholder, the representations and warranties of the
Company contained in Section 1(A) hereof are true and correct.
Any certificate signed by or on behalf of the Selling Stockholder and
delivered to the Representatives or to counsel for the Underwriters at the First
Closing Date or the Second Closing Date, as the case may be, shall be deemed to
be a representation and warranty by the Selling Stockholder to each Underwriter
as to the matters covered thereby.
SECTION 2. PURCHASE, SALE AND DELIVERY OF THE COMMON SHARES.
(a) THE FIRM COMMON SHARES. The Company agrees to issue and sell to the
several Underwriters the Firm Common Shares upon the terms herein set forth. 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 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 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 [___], or such other time and date not later
than 10:30 a.m. San Francisco time, on [___] 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 [___] Optional Common Shares from the Company
and the Selling Stockholder hereby grants an option to the several Underwriters
to purchase, severally and not jointly, up to an aggregate of 100,000 Optional
Common Shares from the Selling Stockholder, each such option to be 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
11
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. To the extent the Underwriters exercise the option
for less than the maximum number of Optional Common Shares, the Underwriters
shall purchase Selling Stockholder Optional Common Shares first from the Selling
Stockholder, and to the extent additional Optional Common Shares are to be
purchased by the Underwriters, such additional Optional Common Shares shall be
purchased from 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 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 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, if any, to be sold by the Selling
Stockholder shall be made at the First Closing Date or, if applicable, at the
Second Closing Date, as the case may be, 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) he 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 shall deliver, or cause
to be delivered, to the Representatives for the accounts of the several
Underwriters certificates for the Firm Common Shares 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 and the Selling
Stockholder 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
12
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., New York time, 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:
(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 reasonable 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 (including any amendment or supplement through
incorporation by reference of any report filed under the Exchange Act), 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 reasonable 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
13
Section 3(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 (including any documents incorporated or deemed
incorporated by reference therein) as the Representatives may reasonably
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 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 Section 11(a) of the Securities Act.
(j) PERIODIC REPORTING OBLIGATIONS. During the Prospectus Delivery
Period the Company shall file, on a timely basis, with the Commission all
reports and documents required to be filed under the Exchange Act.
14
(k) AGREEMENT NOT TO OFFER OR SELL ADDITIONAL SECURITIES. During the
period of 90 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 (other than a registration
statement on Form S-8 or any successor form thereto) 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, 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 of its currently existing stock option, stock bonus or
other stock plans or arrangements.
(l) FUTURE REPORTS TO THE REPRESENTATIVES. During the period of three
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.
(m) EXCHANGE ACT COMPLIANCE. During the Prospectus Delivery Period, the
Company will file all documents required to be filed by it with the Commission
pursuant to Section 13, 14, or 15 of the Exchange Act in the manner and within
the time periods required by the Exchange Act.
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 by it 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, reasonable 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)
15
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
14 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 his obligations under this Agreement which are not otherwise
specifically provided for herein, including but not limited to (i) fees and
expenses of his 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 him to the 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 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 Representative
shall have received from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 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 Representative,
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);
16
(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 Underwriters; and
(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 reasonable judgment of the Representatives there shall not
have occurred any Material Adverse Change.
(d) OPINION OF COUNSEL FOR THE COMPANY AND THE SELLING STOCKHOLDER. On
each of the First Closing Date and the Second Closing Date, if any, the
Representatives shall have received the favorable opinion of ▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇
LLP, counsel for the Company and the Selling Stockholder, 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 Wolf, Greenfield &
Sacks, P.C., 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 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 caption "Description of Capital Stock" under subparagraph (i) only, and
also as to the statements in the Prospectus under the caption "Underwriting"),
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 of 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.
(g) 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 on behalf of the Company by the Chairman of the Board,
Chief Executive Officer and President of the Company and the Chief Financial
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:
(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;
17
(ii) the representations, warranties and covenants of the
Company set forth in Section 1(A) of this Agreement are true and
correct with the same force and effect as though expressly made on and
as of such Closing Date; and
(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.
(h) 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.
(i) BRING-DOWN COMFORT LETTER. On each of the First Closing Date and
the Second Closing Date, if any, the Representatives shall have received from
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 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).
(j) LOCK-UP AGREEMENT FROM CERTAIN SECURITYHOLDERS OF THE COMPANY. On
the date hereof, the Company shall have furnished to the Representatives an
agreement in the form of EXHIBIT B hereto from each director and executive
officer of the Company, and from certain securityholders of the Company, all as
listed on SCHEDULE C hereto, and such agreement shall be in full force and
effect on each of the First Closing Date and the Second Closing Date, if any.
(k) SELLING STOCKHOLDER'S CERTIFICATE. On each Closing Date on which
Optional Common Shares are sold by the Selling Stockholder, the Representatives
shall receive a written certificate executed by the Selling Stockholder, dated
as of such Closing Date, to the effect that:
(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 his part to be performed or
satisfied at or prior to such Closing Date.
(l) 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 Custody Agreement executed by the Selling
Stockholder and such further information, certificates and documents as the
Representatives may reasonably request.
(m) 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 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.
18
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 or Section
11, 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 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 the
Company or the Representatives 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) any Underwriter to the
Company or the Selling Stockholder, or (c) 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.
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 any litigation, or any
investigation or proceeding by any governmental agency or body,
19
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 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 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 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
20
omission, or any such alleged untrue statement or omission or in connection with
any violation of the 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) any act or failure to act or any
alleged act or failure to act by any Underwriter 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 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 Representative 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 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
21
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 in the table after the first paragraph and
in the second, seventh, eighth, 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 material 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 material 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 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, which approval shall
not be unreasonably withheld or delayed, 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 with
respect to the Underwriters under Section 9), representing the indemnified
parties who are parties to such action) or (ii) the indemnifying party shall not
have employed counsel reasonably 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. 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, 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
22
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 absolutely limited to
an amount equal to the aggregate initial public offering price of all 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
by a court of competent jurisdiction 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 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.
23
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.
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
24
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 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 in each case the provisions
of Section 8 and Section 9 shall at all times be effective and shall survive
such termination.
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: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
with a copy to:
Banc of America Securities LLC
▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
25
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Esq.
And with a copy to:
Mintz, Levin, Cohn, Ferris,
Glovsky and Popeo, P.C.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
If to the Company or the Selling Stockholder:
ABIOMED, Inc.
▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
With a copy to:
▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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.
26
(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 (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.
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 or the Second Closing Date, as applicable,
pursuant to this Agreement, then the Underwriters may at their option, by
written notice from the Representatives 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 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 or the Second
Closing Date, as applicable, 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.
27
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to the Company 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,
ABIOMED, INC.
By:..........................
Name: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: President and Chief Executive Officer
▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, as Selling Stockholder
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
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, INC.
Acting as Representatives of the several Underwriters named in the attached
Schedule A.
By: BANC OF AMERICA SECURITIES LLC
By:
-------------------------------------------------
Name:
--------------------------------------------
Title:
--------------------------------------------
28
SCHEDULE A
SCHEDULE OF UNDERWRITERS
NUMBER OF
UNDERWRITERS FIRM COMMON SHARES
TO BE PURCHASED
Banc of America Securities LLC [___]
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc. [___]
[----------------------------] [___]
[----------------------------] [___]
[----------------------------] [___]
Total [___]
29
SCHEDULE B
SCHEDULE OF COMPANY PATENTS AND TRADEMARKS
ABIOMED, INC. TRADEMARKS
----------------------------------------------------------------------------------------------------
▇▇▇▇ SERIALNUMBER FILINGDATE REGNO REGDATE
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
ABIOCOR 75/725,736 06/09/1999
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
ABIOVEST 75/724,929 06/09/1999
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
HEARTVEST 75/725,746 06/09/1999
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
ABIOBOOSTER 75/724,712 06/09/1999
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
ANGIOFLEX TBD 12/13/1999
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
ABIOMED 73/454,060 11/23/1983 1,332,596 04/23/1985
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
ABIOMED 74/068,233 06/12/1990 1,645,900 05/28/1991
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
AB ABIOMED (and design) 74/068,307 06/12/1990 1,650,057 07/09/1991
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
AB ABIOMED (and design) 73/696,146 11/18/1997 1,505,320 09/20/1988
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
AB (and design) 73/696,145 11/18/1997 1,500,877 08/16/1988
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
ABIODENT 74/017,557 01/09/1990 1,730,278 11/03/1992
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
SUPRACOR 74/540,720 06/21/1994 1,939,393 12/05/1995
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
PERIOTEMP 74/027,668 02/12/1990 1,626,917 12/11/1990
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
BVS 73/664,813 06/05/1987 1,507,961 10/11/1988
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
BVS SYSTEM 5000 73/664,833 06/05/1987 1,507,962 10/11/1988
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
BVS 5000 TBD 01/06/2000
----------------------------------------------------------------------------------------------------
ABIOMED, INC. ISSUED PATENTS
-------------------------------------------------------------------------------------------
APPLICATIONTITLE PATENTNO ISSUEDATE
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Prosthetic Heart Valve 4,888,009 12/19/1989
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
High-Frequency Intra-Arterial Cardiac Support System 4,785,795 11/22/1988
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Periodontal Probe 4,832,599 05/23/1989
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Diagnostic Temperature Probe 4,962,765 10/16/1990
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Ventricular Support System 4,782,817 11/08/1988
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Intra-Arterial Cardiac Support System 4,902,272 02/20/1990
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Intravenous Drug Mixing and Flow Device 4,802,650 02/07/1989
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Artificial Heart 4,888,011 12/19/1989
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Intraortic Balloon Insertion 5,090,957 02/25/1992
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Insertable Balloon with Curved Support 4,943,275 07/24/1990
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Balloon Stretch Mechanism 4,968,300 11/06/1990
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Periodontal Analyzer D 318,113 07/09/1991
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Surgical Stapler 4,930,674 06/05/1990
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Leak Detector 5,045,051 09/03/1991
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Blood Pump 5,089,016 02/18/1992
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Surgical Cuff 5,084,064 01/28/1992
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Curved Intra Aortic Balloon with Non-Folding Inflated 5,116,305 05/26/1992
Balloon Membrane
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Gravity Independent Infusion System 4,626,243 12/02/1986
-------------------------------------------------------------------------------------------
30
-------------------------------------------------------------------------------------------
Blood Tubing Connector Restraint 4,826,477 05/02/1989
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Infiltration Indicator and Alarm 4,784,648 11/15/1988
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Tubular Circulatory Assist Device 5,643,172 07/01/1997
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Laser Welding System 5,662,643 09/02/1997
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Extra Cardiac Ventricular Assist 5,713,954 02/03/1998
-------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------
Passive Girdle for Heart Ventricle for Therapeutic Aid 5,800,528 09/01/1998
to Patients Having Ventricular Dilatation
-------------------------------------------------------------------------------------------
31
SCHEDULE C
SCHEDULE OF PERSONS AND ENTITIES
SUBJECT TO LOCK-UP AGREEMENT
W. ▇▇▇▇▇▇ ▇▇▇▇▇▇, M.D.
▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ Fireman
Genzyme Corporation
▇▇▇▇▇ ▇.▇. ▇▇▇▇ Trust
▇▇▇▇▇ ▇. ▇▇▇▇ Revocable Trust
▇▇▇▇▇▇ ▇.▇. ▇▇▇▇ Trust
▇▇▇▇▇▇ T.V. Kung, Ph.D.
▇▇▇▇▇▇ T.V. Kung Revocable Trust
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Ph.D.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇. ▇'▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇'▇▇▇▇▇▇▇, ▇▇.
▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇ and ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇
32
EXHIBIT A
FORM OF OPINION OF COUNSEL FOR THE COMPANY AND THE SELLING STOCKHOLDER
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 and the Selling Stockholder 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 Commonwealth of
Massachusetts and in each other 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
Commonwealth of Massachusetts) 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.
(iv) Each significant subsidiary of the Company (as defined in Rule 405
under the Securities Act) 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 and, to the best knowledge of such counsel, 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 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, and except that we express no opinion with
respect to any subsidiary that is organized outside the United States of
America.
(v) All of the issued and outstanding capital stock of each such
significant subsidiary of the Company is owned of record by the Company,
directly or through subsidiaries.
(vi) The authorized, issued and outstanding capital stock of the
Company (including the Common Shares) and preferred stock purchase rights
conform to the descriptions thereof set forth in the Prospectus under the
heading "Description of Capital Stock." 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.
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(vii) No stockholder of the Company or any other person has any
preemptive right, right of first refusal or other similar right 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 knowledge of such
counsel, otherwise.
(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 statutory or contractual preemptive or
similar rights.
(x) Based solely on the oral advice of the staff of the Commission,
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 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, including any document incorporated by reference
therein, and each amendment or supplement to the Registration Statement and
the Prospectus including any document incorporated by reference therein, as
of their respective effective or issue dates (other than the financial
statements and notes thereto and supporting schedules included or
incorporated by reference therein or in exhibits to or excluded from the
Registration Statement, as to which we express no opinion) comply as to
form in all material respects with the applicable requirements of the
Securities Act and the Exchange Act. We express no opinion as to the
accuracy of any financial, accounting or statistical data contained in the
Registration Statement, the Prospectus or any amendment or supplement
thereto (or any document incorporated by reference therein).
(xii) The Common Shares have been approved for listing on the Nasdaq
National Market.
(xiii) The statements (i) in the Prospectus under the captions
"Description of Capital Stock", "Management's Discussion and Analysis and
Results of Operations--Liquidity and Capital Resources" and
"Business--Legal Proceedings" and (ii) Item 15 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 fairly present and summarize, in all material respects, the matters
referred to therein. We express no opinion with respect to the outcome of
any pending or threatened legal proceeding of any kind or nature.
(xiv) To the knowledge of such counsel, there are no legal or
governmental actions, suits or proceedings pending or threatened which are
required to be disclosed in the Registration Statement (including the
documents incorporated by reference therein), other than those disclosed
therein.
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(xv) To the knowledge of such counsel, there are no Existing
Instruments required to be described or referred to in the Registration
Statement (including the documents incorporated by reference therein) 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 and performance
of the Underwriting Agreement and consummation of the transactions
contemplated thereby and by the Prospectus, except as 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 and contribution sections 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 of the exhibits numbered 4(c) and 10(a)
through 10(o), inclusive, listed in the Company's Annual Report on Form
10-K for the Fiscal Year ended March 31, 1999 or any of the exhibits
numbered 10(a), 10(b) and 10(c) listed in the Company's Quarterly Report on
Form 10-Q for the Quarter ended September 30, 1999; or (iv) to the
knowledge of such counsel, will not result in any violation of any law,
administrative regulation or administrative or court decree applicable to
the Company or any subsidiary.
(xviii) 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.
(xix) Each document filed pursuant to the Exchange Act (other than the
financial statements and supporting schedules included therein, as to which
no opinion need be rendered) and incorporated or deemed to be incorporated
by reference in the Prospectus complied when so filed as to form in all
material respects with the Exchange Act.
(xx) The Underwriting Agreement has been duly authorized, executed and
delivered by or on behalf of the Selling Stockholder.
(xxi) 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, to such counsel's knowledge, contravene or conflict with, result
in a breach of, or constitute a default under any agreement or instrument
to which the Selling Stockholder is a party or by which he is bound, 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.
(xxii) The Selling Stockholder is the sole record owner of the Common
Shares which may be sold by the Selling Stockholder under the Underwriting
Agreement and has the legal right and power
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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 his other obligations under the Underwriting Agreement,
the Custody Agreement and the Power of Attorney.
(xxiii) Each of the Custody Agreement and the Power of Attorney of the
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 or contribution 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.
(xxiv) 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 (within
the meaning of Section 8-303 of the Uniform Commercial Code) to such Common
Shares, upon the delivery of such Common Shares pursuant to the
Underwriting Agreement the Underwriters will acquire their interests in
such Common Shares free and clear of any adverse claim.
(xxv) To 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 addition, such counsel shall state that they have participated in
conferences with officers and other representatives of the Company,
representatives of the independent public or certified public accountants for
the Company and with representatives of the Underwriters at which the contents
of the Registration Statement and the Prospectus, and any supplements or
amendments thereto, and related matters were discussed and, although such
counsel is not passing upon and does not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus (other than as specified above), and
any supplements or amendments thereto, on the basis of the foregoing, and
relying, as to materiality, upon the statements of officers and other
representatives of the Company, nothing has come to their attention which would
lead them to believe that either the Registration Statement or any amendments
thereto, at the time the Registration Statement or such amendments became
effective, contained an 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 or that the Prospectus, as of its date or at
the First Closing Date or the Second Closing Date, as the case may be, contained
an untrue statement of a material fact or omitted 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 (it being understood
that such counsel need express no belief as to the statistical information
furnished by the Underwriters, the financial statements and notes thereto or
schedules and all financial, accounting and statistical data derived therefrom,
included or incorporated by reference in the Registration Statement or the
Prospectus or any amendments or supplements thereto).
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
Commonwealth of Massachusetts 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
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Closing Date or the Second Closing Date, as the case
may be, shall be reasonably 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 reasonably 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, the Selling Stockholder (as
to opinions (xxii) through (xxvii)) and public officials.
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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.
(i) for the purpose of this opinion, the terms "know,"
"known," or "knowledge" refer to the actual knowledge of such
counsel, as well as the knowledge arising from such counsel's
review of documents and materials relevant to the matters
addressed in such paragraphs, and the knowledge arising from
such counsel's inquiry of any employee or officer of the
Company familiar with a matter to which such counsel's opinion
pertains. For the purpose of this opinion, the term "material"
shall have the meaning given to it in Rule 405 of the
Securities Act;
(ii) all patents and pending patent applications ("Patents")
that are owned by or licensed to the Company and known to such
counsel, and all contracts known to such counsel pursuant to
which the Company has, or has granted, rights to any Patents,
are listed on Schedule A. All trademarks and pending trademark
applications ("Trademarks") that are owned by or licensed to
the Company and known to such counsel, and all contracts known
to such counsel pursuant to which the Company has, or has
granted, rights to any Trademarks, are listed on Schedule B.
All registered domain names and pending domain name
registrations ("Domain Names") that are owned by or licensed
to the Company and known to such counsel, and all contracts
known to such counsel pursuant to which the Company has, or
has granted, rights to any Domain Names, are listed on
Schedule C. To the best of such counsel's knowledge, the
Company has not applied for any copyright registrations, and
such counsel is not aware of any copyrights or pending
copyright applications ("Copyrights") that are owned by or
licensed to the Company, nor of any contracts known to such
counsel pursuant to which the Company has, or has granted,
rights to any Copyrights;
(iii) based upon such counsel's (a) inquiry of the Company's
representatives responsible for Patent, Trademark, and Domain
Name matters, (b) such counsel's review of the chain of title
in the United States Patent and Trademark Office ("USPTO") of
the Company's United States Patents listed in Schedule A and
of the Company's Trademarks listed in Schedule B, and (c)
instructions to foreign associates to file assignments to the
Company in foreign jurisdictions with regard to the foreign
Patents listed in Schedule A and the foreign Trademarks listed
in Schedule B, (i) the Patents and Trademarks have been
validly assigned to the Company and (ii) except as provided in
Schedules A and B, the Company is listed as the sole holder of
record of each of the Patents and Trademarks, and such counsel
knows of no claims of third parties to any ownership interest
in, or to any lien with respect to, any of the Patents or
Trademarks. Except as provided in Schedules A and D, such
counsel knows of no actual or asserted nonjoined or misjoined
inventorship interest in any of the Patents. Such counsel has
no knowledge of any facts
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that would preclude the Company from having clear title and
unencumbered right to the Patents and Trademarks, so that by
virture of such valid assignment to it the Company has the
right to enforce each of the Patents and Trademarks. None of
the Patents or Trademarks has been abandoned;
(iv) to the best of such counsel's knowledge, the Company
has complied with the USPTO duty of candor and disclosure for
each of the United States Patents and Trademarks. No fact has
come to such counsel's attention that causes such counsel to
question the enforceability of any of the Patents or
Trademarks, or to question the validity of any claim of an
issued patent listed on Schedule A. Such counsel knows of no
pending action, suit, proceeding or claim by others
challenging the validity or enforceability of any claim of the
issued patents listed on Schedule A, the Trademarks listed on
Schedule B, or the Domain Names listed on Schedule C;
(v) to the best of such counsel's knowledge, all legal or
governmental proceedings relating to the Company's Patent,
Trademark, Domain Name and trade secret rights, other than an
EX PARTE USPTO examination proceeding, are listed on Schedule
D, including but not limited to any pending or threatened
interference, opposition, public use, reexamination, reissue,
or protest proceeding with respect to any Patent, or to any
pending or threatened opposition with respect to any
Trademark, or to any pending or threatened dispute with
respect to misappropriation of any trade secret by or from the
Company, in the United States or in a foreign jurisdiction;
(vi) to the best of such counsel's knowledge, the statements
in the Prospectus relating to patent, trademark, copyright,
domain name, and licensing matters under the captions "Risk
Factors", "Business-Proprietary Rights, Patents and Know-How",
"Business-Legal Proceedings" and any other references in the
Prospectus to patent, trademark, copyright, domain name, and
licensing matters, insofar as such statements constitute a
summary of legal matters, documents, or proceedings, are
accurate and present fairly the matters set forth therein,
and, except as described in the Prospectus, to the best of
such counsel's knowledge there is no pending or threatened
action, suit, proceeding or claim by others that the Company
is infringing any patent or any trademark which could result
in any material adverse effect on the Company;
(vii) except as described in the Prospectus, such counsel is
not aware of any facts that would form a basis for the belief
that the Company lacks any rights or licenses to use all
patents, trademarks, copyrights, domain names, know-how and
other intellectual property necessary to conduct the business
now conducted or proposed to be conducted by the Company as
described in the Prospectus; and
(viii) no facts have come to such counsel's attention which
cause such counsel to believe that the statements in the
Prospectus relating to patent, trademark, copyright, domain
name, trade secret, and licensing matters under the captions
"Risk Factors", "Business-Proprietary Rights, Patents and
Know-How", "Business-Legal Proceedings," and any other
references in the Prospectus to patent, trademark, copyright,
domain name, trade secret, and licensing matters, contain an
untrue or misleading statement of material fact, or omit a
material fact necessary to make the statements therein not
misleading.
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EXHIBIT B
FORM OF LOCK-UP AGREEMENT
Banc of America Securities LLC
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
As Representatives of the Several Underwriters
c/o Banc of America Securities LLC
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▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
RE: ABIOMED, 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
90 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.
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This agreement is irrevocable and will be binding on the undersigned
and the respective successors, heirs, personal representatives, and assigns of
the undersigned.
Dated: , 1999
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Printed Name of Holder
By:
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Signature
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Printed Name of Person Signing
(AND INDICATE CAPACITY OF PERSON SIGNING IF
SIGNING AS CUSTODIAN, TRUSTEE, OR ON BEHALF
OF AN ENTITY)
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