Versicor Inc.
4,600,000 Shares
Common Stock
($.001 Par Value)
UNDERWRITING AGREEMENT
August __, 2000
UNDERWRITING AGREEMENT
August __, 2000
▇▇▇▇▇▇ Brothers Inc.
Chase Securities Inc.
Pacific Growth Equities, Inc.
UBS Warburg LLC
Fidelity Capital Markets, a division of National Financial Services Corporation
As representatives of the several Underwriters
named in Schedule A hereto
c/▇ ▇▇▇▇▇▇ Brothers Inc.
3 World Financial Center
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Versicor Inc., a Delaware corporation (the "Company"),
proposes to issue and sell to the Underwriters named in Schedule A annexed
hereto (the Underwriters) an aggregate of 4,600,000 shares (the "Firm Shares")
of Common Stock, $.001 par value per share (the "Common Stock"), of the Company.
In addition, solely for the purpose of covering over-allotments, the Company
proposes to grant to the Underwriters the option to purchase from the Company up
to an additional 690,000 shares of Common Stock (the Additional Shares). The
Firm Shares and the Additional Shares are hereinafter collectively sometimes
referred to as the Shares. The Shares are described in the Prospectus which is
referred to below.
The Company hereby acknowledges that in connection with the
proposed offering of the Shares, it has requested ▇▇▇▇▇▇ Brothers Inc.
("▇▇▇▇▇▇") and ▇▇▇▇▇▇ has agreed to administer a directed share program. It is
understood that approximately 230,000 shares of the Firm Shares (the "Directed
Shares") will initially be reserved by the Underwriters for offer and sale to
employees and persons having business relationships with the Company (the
"Directed Share Participants") upon the terms and conditions set forth in the
Prospectus and in accordance with the rules and regulations of the National
Association of Securities Dealers, Inc. Under no circumstances will ▇▇▇▇▇▇ or
any Underwriter be liable to the Company or to any Directed Share Participant
for any action taken or omitted to be taken in good faith in connection with
such Directed Share Program. To the extent that any Directed Shares are not
affirmatively reconfirmed for purchase by any Directed Share
Participant on or immediately after the date of this Agreement, such Directed
Shares may be offered to the public as part of the public offering contemplated
hereby.
The Company agrees to pay all reasonable fees and
disbursements incurred by the Underwriters in connection with the Directed Share
Program, including reasonable counsel fees and any stamp duties or other taxes
incurred by the Underwriters in connection with the Directed Share Program.
The Company has filed, in accordance with the provisions of
the Securities Act of 1933, as amended, and the rules and regulations thereunder
(collectively called the Act), with the Securities and Exchange Commission (the
Commission) a registration statement on Form S-1 (File No. 333-33022) including
a prospectus, relating to the Shares. The Company has furnished to you, for use
by the Underwriters and by dealers, copies of one or more preliminary
prospectuses (each thereof being herein called a Preliminary Prospectus)
relating to the Shares. Except where the context otherwise requires, the
registration statement, as amended when it becomes effective, including all
documents filed as a part thereof, and including any information contained in a
prospectus subsequently filed with the Commission pursuant to Rule 424(b) under
the Act and deemed to be part of the registration statement at the time of
effectiveness pursuant to Rule 430A under the Act, and also including any
registration statement filed pursuant to Rule 462(b) under the Act, is herein
called the Registration Statement, and the prospectus, in the form filed by the
Company with the Commission pursuant to Rule 424(b) under the Act on or before
the second business day after the date hereof (or such earlier time as may be
required under the Act) or, if no such filing is required, the form of final
prospectus included in the Registration Statement at the time it became
effective, is herein called the Prospectus.
The Company and the Underwriters agree as follows:
1. SALE AND PURCHASE. Upon the basis of the representations
and warranties and subject to the terms and conditions herein set forth, the
Company agrees to sell to the respective Underwriters and each of the
Underwriters, severally and not jointly, agrees to purchase from the Company the
aggregate number of Firm Shares set forth opposite the name of such Underwriter
in Schedule A attached hereto in each case at a purchase price of $____ per
Share. The Company is advised by you that the Underwriters intend (i) to make a
public offering of their respective portions of the Firm Shares as soon after
the effective date of the Registration Statement as in your judgment is
advisable and (ii) initially to offer the Firm Shares upon the terms set forth
in the Prospectus. You may from time to time increase or decrease the public
offering price after the initial public offering to such extent as you may
determine.
In addition, the Company hereby grants to the several
Underwriters the option to purchase, and upon the basis of the representations
and warranties and subject to the terms and conditions herein set forth, the
Underwriters shall have the right to purchase, severally
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and not jointly, from the Company, ratably in accordance with the number of Firm
Shares to be purchased by each of them, all or a portion of the Additional
Shares as may be necessary to cover over-allotments made in connection with the
offering of the Firm Shares, at the same purchase price per share to be paid by
the Underwriters to the Company for the Firm Shares. This option may be
exercised by you on behalf of the several Underwriters at any time, but not more
than once, on or before the thirtieth day following the date hereof, by written
notice to the Company. Such notice shall set forth the aggregate number of
Additional Shares as to which the option is being exercised, and the date and
time when the Additional Shares are to be delivered (such date and time being
herein referred to as the additional time of purchase); PROVIDED, HOWEVER, that
the additional time of purchase shall not be earlier than the time of purchase
(as defined below) nor earlier than the second business day(1) after the date on
which the option shall have been exercised nor later than the tenth business day
after the date on which the option shall have been exercised. The number of
Additional Shares to be sold to each Underwriter shall be the number which bears
the same proportion to the aggregate number of Additional Shares being purchased
as the number of Firm Shares set forth opposite the name of such Underwriter on
Schedule A hereto bears to the total number of Firm Shares (subject, in each
case, to such adjustment as you may determine to eliminate fractional shares).
2. PAYMENT AND DELIVERY. Payment of the purchase price for the
Firm Shares shall be made to the Company by Federal Funds wire transfer, against
delivery of the certificates for the Firm Shares to you through the facilities
of the Depository Trust Company (DTC) for the respective accounts of the
Underwriters. Such payment and delivery shall be made at 10:00 A.M., New York
City time, on August __, 2000 (unless another time shall be agreed to by you and
the Company or unless postponed in accordance with the provisions of Section 8
hereof). The time at which such payment and delivery are actually made is
hereinafter sometimes called the time of purchase. Certificates for the Firm
Shares shall be delivered to you in definitive form in such names and in such
denominations as you shall specify on the second business day preceding the time
of purchase. For the purpose of expediting the checking of the certificates for
the Firm Shares by you, the Company agrees to make such certificates available
to you for such purpose at least one full business day preceding the time of
purchase.
Payment of the purchase price for the Additional Shares shall
be made at the additional time of purchase in the same manner and at the same
office as the payment for the Firm Shares. Certificates for the Additional
Shares shall be delivered to you in definitive form in such names and in such
denominations as you shall specify no later than the second business day
preceding the additional time of purchase. For the purpose of expediting the
checking of the certificates for the Additional Shares by you, the Company
agrees to make
----------
(1) As used herein "business day" shall mean a day on which
the Nasdaq National Market is open for trading.
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such certificates available to you for such purpose at least one full business
day preceding the additional time of purchase.
Deliveries of the documents described in Section 6 below with
respect to the purchase of the Shares shall be made at the offices of O'Melveny
& ▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ at 9:00 A.M., New
York time, on the date of the closing of the purchase of the Firm Shares or the
Additional Shares, as the case may be. The Company shall not be obligated to
deliver any of the Firm Share or the Additional Shares except upon payment for
all of the Firm Shares or the Additional Shares, as the case may be, to be
purchased on the date of closing of the Firm Shares or the Additional Shares, as
the case may be.
3. REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to each of the Underwriters that:
(a) the Company has not received, and has no written notice
of, any order of the Commission preventing or suspending the use of any
Preliminary Prospectus, or instituting proceedings for that purpose, and each
Preliminary Prospectus, at the time of filing thereof, conformed in all material
respects to the requirements of the Act; and when the Registration Statement
became or becomes effective, the Registration Statement and the Prospectus
complied or will comply fully in all material respects with the provisions of
the Act, and the Registration Statement did not or 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 statements therein not misleading, and
the Prospectus did not or 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 statements therein, in light of the circumstances under which they
were made, not misleading and the Prospectus, any Preliminary Prospectus and any
supplement thereto or prospectus wrapper prepared in connection therewith, at
their respective times of issuance and at the time of closing, complied and will
comply in all material respects with any applicable laws or regulations of
jurisdictions in which the Prospectus and such Preliminary Prospectus, as
amended or supplemented, if applicable, are distributed in connection with the
offer and sale of Reserved Shares, PROVIDED, HOWEVER, that the Company makes no
warranty or representation with respect to any statement contained in the
Registration Statement or the Prospectus in reliance upon and in conformity with
information concerning the Underwriters and furnished in writing by or on behalf
of any Underwriter to the Company expressly for use in the Registration
Statement or the Prospectus;
(b) as of the date of this Agreement, the Company has
authorized and outstanding capital stock as set forth under the heading entitled
"Actual" in the section of the Registration Statement and the Prospectus
entitled "Capitalization" and, as of the time of purchase, and assuming the
receipt and application of the net proceeds as described under the section of
the Registration Statement and the Prospectus entitled "Use of Proceeds," the
Company shall have an authorized and outstanding capital stock as set forth
under the heading
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entitled "Pro Forma As Adjusted" in the section of the Registration Statement
and the Prospectus entitled "Capitalization"; as of the time of purchase all of
the issued and outstanding shares of capital stock of the Company will be duly
and validly authorized and when issued and delivered to the Underwriter against
payment therefore in accordance with the terms hereof, will be validly issued,
fully paid and non-assessable;
(c) the Company has been duly incorporated and is validly
existing as a corporation and is in good standing under the laws of the State of
Delaware, with corporate power and authority to own, lease and operate its
properties and conduct its business as described in the Registration Statement;
(d) the Company is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction in which the ownership
or leasing of its properties or the conduct of its business requires such
qualification, except where the failure to so qualify would not individually or
in the aggregate have a material adverse effect on the business properties,
condition (financial or otherwise) or results of operation of the Company, taken
as a whole (a "Material Adverse Effect"); the Company does not have any
subsidiaries (as defined in the Act); the Company does not own, directly or
indirectly, any shares of stock or any other equity or long-term debt securities
of any corporation or have any equity interest in any firm, partnership, limited
liability company, joint venture, association or other entity except as set
forth in the Registration Statement and the Prospectus; complete and correct
copies of the certificate of incorporation and bylaws or other organizational
documents of the Company and all amendments thereto have been delivered to you,
and except as set forth in the exhibits to the Registration Statement no changes
therein will be made subsequent to the date hereof and prior to the time of
purchase or, if later, the additional time of purchase;
(e) The Company is not in violation of any law, ordinance,
administrative or governmental rule or regulation applicable to the Company or
of any decree of any court or governmental agency or body having jurisdiction
over the Company, which violation would constitute individually or in the
aggregate a Material Adverse Effect.
(f) the Company is not in breach of, or in default under (and
no event has occurred which with notice, lapse of time, or both would result in
any breach of, or constitute a default under), its charter or bylaws or other
organizational documents or in the performance or observance of any obligation,
agreement, covenant or condition contained in any indenture, mortgage, deed of
trust, bank loan or credit agreement or other evidence of indebtedness, or any
lease, contract or other agreement or instrument to which the Company is a party
or by which it or any of its properties is bound the effect of which breach or
default would individually or in the aggregate have a Material Adverse Effect,
and the execution, delivery and performance of this Agreement, the issuance and
sale of the Shares contemplated hereby and by the Registration Statement will
not conflict with, or result in any breach of or constitute a default under (nor
constitute any event which with notice, lapse of time, or both would result in
any breach of, or constitute a default under), any provisions of the charter or
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bylaws or other organizational documents of the Company or under any provision
of any license, permit, franchise, indenture, mortgage, deed of trust, bank loan
or credit agreement or other evidence of indebtedness, or any lease, contract or
other agreement or instrument to which the Company is a party or by which it or
its properties may be bound or affected, or under any federal, state, local or
foreign law, regulation or rule or any decree, judgment or order applicable to
the Company the result of which conflict breach or default would individually or
in the aggregate have a Material Adverse Effect;
(g) this Agreement has been duly authorized, executed and
delivered by the Company except as rights to indemnity and contribution
hereunder may be limited by Federal or State Securities laws;
(h) the capital stock of the Company, including the Shares,
conforms in all material respects to the description thereof contained in the
Registration Statement and Prospectus; the certificates for the Shares are in
due and proper form; and the holders of the Shares will not be subject to
personal liability by reason of being such holders;
(i) no approval, authorization, consent or order of or filing
with any national, state or local governmental or regulatory commission, board,
body, authority or agency is required in connection with the execution, delivery
and performance by the Company of this Agreement, the issuance and sale of the
Shares contemplated hereby and by the Registration Statement, other than
registration of the Shares under the Act, which has been or will be effected by
the Company, and any necessary qualification under the securities or blue sky
laws of the various jurisdictions in which the Shares are being offered by the
Underwriters or under the rules and regulations of the National Association of
Securities Dealers, Inc. (NASD);
(j) except as set forth in the Registration Statement and the
Prospectus: (i) no person has the right, contractual or otherwise, to cause the
Company to issue to it, or register pursuant to the Act, any shares of capital
stock or other equity interests; and (ii) no person has any preemptive rights,
co-sale rights, rights of first refusal or other rights to purchase any shares
of Common Stock of the Company.
(k) PricewaterhouseCoopers LLP, whose report on the financial
statements of the Company is filed with the Commission as part of the
Registration Statement and Prospectus, are independent public accountants as
required by the Act;
(l) the Company has all necessary licenses, permits,
franchises, authorizations, consents and approvals, and made all necessary
filings required under any federal, state, local or foreign law, regulation or
rule, and has obtained all necessary authorizations, consents and approvals from
other persons, in order to conduct its business except as would not have a
Material Adverse Effect; the Company is not in violation of, or in default
under, any such license, permit, franchise, authorization, consent or approval
or any
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federal, state, local or foreign law, regulation or rule or any decree, order or
judgment applicable to the Company, the effect of which violation or default
would individually or in the aggregate have a Material Adverse Effect;
(m) except for patent proceedings and other regulatory
approvals, there are no private or governmental actions, suits, claims,
investigations or proceedings pending or, to the knowledge of the Company,
threatened to which the Company or any of its officers is subject or of which
any of its properties is subject, whether at law, in equity or before or by any
federal, state, local or foreign governmental or regulatory commission, board,
body, authority or agency which would result in a judgment, decree or order that
would have a Material Adverse Effect;
(n) the audited financial statements of the Company included
in the Registration Statement and the Prospectus present fairly the financial
position and results of operations of the Company as of the dates and for the
periods indicated; such financial statements have been prepared in conformity
with generally accepted accounting principles applied on a consistent basis
during the periods involved; the pro forma financial data included in the
Registration Statement and the Prospectus comply as to form in all material
respects with the applicable accounting requirements of Regulation S-X of the
Securities Act, and the pro forma adjustments have been properly applied to the
historical amounts in the compilation of those statements; and the other
financial and statistical data set forth in the Registration Statement and the
Prospectus are fairly presented and prepared on a basis consistent with such
financial statements and the books and records of the Company;
(o) subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, and except as may be
otherwise stated in the Registration Statement or the Prospectus, there has not
been (i) any material adverse change, or any development which, in the Company's
reasonable judgment, is likely to cause a material adverse change, in the
business, properties, condition (financial or otherwise) or results of
operations of the Company, (ii) any transaction which is material to the Company
and not in the ordinary course of business, (iii) the incurrence by the Company
of any obligation, direct or contingent, and not in the ordinary course of
business, which is material to the Company, (iv) any change in the capital stock
or other equity interest or material increase in the outstanding indebtedness of
the Company or (v) any dividend or distribution of any kind declared, paid or
made on the capital stock or other equity interest of the Company. The Company
does not have any material contingent obligations which are not disclosed in the
Registration Statement;
(p) the Company has obtained the agreement of each of its
executive officers and directors and certain other holders of Common Stock and
securities convertible into or exchangeable or exercisable for Common Stock
listed on Schedule __ not to sell, offer to sell, contract to sell, hypothecate,
pledge, grant any option to sell or otherwise dispose of, directly or
indirectly, any shares of Common Stock or securities convertible into or
7
exchangeable or exercisable for Common Stock or warrants or other rights to
purchase Common Stock for a period of 180 days after the date of the Prospectus
without the prior written consent of ▇▇▇▇▇▇;
(q) the Company has good and marketable title to all property
(real and personal) described in the Prospectus as being owned by it, free and
clear of all liens, claims, security interests or other encumbrances except such
as are described in the Registration Statement and the Prospectus and except as
would not individually or in the aggregate have a Material Adverse Effect. All
the property described in the Prospectus as being held under lease by the
Company is held thereby under valid, subsisting and enforceable leases;
(r) the Company is insured by insurers of recognized financial
responsibility against such losses and risks and in such amount as is
commercially reasonable and consistent with the business in which it is engaged;
all policies of insurance insuring the Company or any of its businesses, assets,
employees, officers and directors are in full force and effect, and the Company
is in compliance with the terms of such policies in all material respects; there
are no claims by the Company under any such policy or instrument as to which any
insurance company is denying liability or defending under a reservation of
rights clause;
(s) the Company has not either sent or received any notice of
termination of any of the contracts or agreements referred to or described in,
or filed as an exhibit to, the Registration Statement, and no such termination
has been threatened by the Company or any other party to any such contract or
agreement;
(t) all statistical and market-related data included in the
Prospectus are based on or derived from sources that the Company believes to be
reliable and accurate, and the Company has obtained the written consent to the
use of such data from such sources to the extent required;
(u) neither the Company nor, to the knowledge of the Company,
any of its affiliates, directly or indirectly, any action designed to or which
has constituted or which might reasonably be expected to cause or result, under
the Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder (collectively called the Exchange Act) or otherwise, in stabilization
or manipulation of the price of any security of the Company to facilitate the
sale or resale of the Shares;
(v) other than as set forth in the Prospectus or except as
would not have a Material Adverse Effect, the Company will own, possess, license
or have other rights to use all material patents, trademarks, servicemarks,
trade names, copyrights, trade secrets, information, proprietary rights and
processes ("Intellectual Property") for its business as described in the
Prospectus as marketed production, without, to the Company's knowledge, any
conflict with or infringement of the interests of others, and has taken all
reasonable steps necessary to secure interests in such Intellectual Property;
except as disclosed in the
8
Prospectus, the Company is not aware of outstanding options, licenses or
agreements of any kind relating to the Intellectual Property of the Company
which are required to be disclosed in the Prospectus or as would not have a
Material Adverse Effect, and, except as disclosed in the Prospectus the Company
is not a party to or bound by any options, licenses or agreements with respect
to the Intellectual Property of any other person or entity which are required to
be disclosed in the Prospectus except as would not have a Material Adverse
Effect; none of the technology employed by the Company has been obtained or is
being used by the Company in violation of any contractual obligation binding on
the Company or any of its directors or executive officers or, to the Company's
knowledge, any employees of the Company or otherwise in violation of the rights
of any persons; except as disclosed in the Prospectus, the Company has not
received any communications alleging that the Company has violated, infringed or
conflicted with, or, by conducting its business as described in the Prospectus,
would violate, infringe or conflict with any of the Intellectual Property of any
other person or entity other than any such violation, infringement or conflict
which would not individually or in the aggregate have a Material Adverse Effect;
(w) the Company has not sustained since the date of the latest
audited financial statements included in the Prospectus any loss or interference
with its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental action,
order or decree, other than as disclosed in the Prospectus or other than any
loss or interference which individually or in the aggregate would not have a
Material Adverse Effect;
(x) the Company has not violated any foreign, federal, state
or local law or regulation relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes, pollutants
or contaminants, nor any federal or state law relating to discrimination in the
hiring, promotion or pay of employees nor any applicable federal or state wages
and hours laws, nor any provisions of the Employee Retirement Income Security
Act or the rules and regulations promulgated thereunder, which individually or
in the aggregate might result in a Material Adverse Effect;
(y) the Company has contracted with Sepracor Inc., its former
parent company, to maintain a system of internal 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 and to
maintain accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences;
(z) the Company has filed all federal, state, local and
foreign tax returns and tax forms required to be filed and such returns and
forms are complete and correct, and all
9
taxes shown by such returns or otherwise assessed that are due or payable have
been paid, except such taxes as are being contested in good faith and as to
which adequate reserves have been provided, except when such failure to file a
default in payment would not have a Material Adverse Effect. All payroll
withholdings required to be made by the Company with respect to employees have
been made. The charges, accruals and reserves on the books of the Company in
respect of any tax liability for any year not finally determined are adequate to
meet any assessments or reassessments for additional taxes. There have been no
tax deficiencies asserted and, to the knowledge of the Company, no tax
deficiency might be reasonably asserted or threatened against the Company that
could individually or in the aggregate have a Material Adverse Effect;
(aa) the clinical, pre-clinical and other studies and tests
conducted by or on behalf of or sponsored by the Company or in which the Company
or its products or product candidates have participated that are described in
the Prospectus or the results of which are referred to in the Prospectus were
and, if still pending, are being conducted in accordance with accepted medical
and scientific research procedures. The descriptions of the results of such
studies and tests are accurate and complete in all material respects and fairly
present the data derived from such studies and tests, and the Company has no
knowledge of any other studies or tests the results of which are inconsistent
with or otherwise call into question the results described or referred to in the
Prospectus. Except to the extent disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), the Company has operated
and currently is in compliance in all material respects with all applicable FDA
rules, regulations and policies. Except to the extent disclosed in the
Registration Statement and the Prospectus (or any amendment or supplement
thereto), the Company has not received any notices or other correspondence from
the FDA or any other governmental agency requiring the termination, suspension
or modification of any clinical or pre-clinical studies or tests that are
described in the Prospectus or the results of which are referred to in the
Prospectus;
(bb) except as disclosed in the Registration Statement and the
Prospectus, immediately after the issuance and sale of the Shares to the
Underwriters, no shares of preferred stock of the Company shall be issued and
outstanding, and no holder of any shares of capital stock, securities
convertible into or exchangeable or exercisable for capital stock or options,
warrants or other rights to purchase capital stock or any other securities of
the Company shall have any existing or future right to acquire any shares of
preferred stock of the Company; and
(cc) the Company is not, and as a result of the offering and
sale of the Shares, will not become, an "investment company" or a "promoter,"
"principal underwriter" for or an entity "controlled" by an "investment
company," as such terms are defined in the Investment Company Act of 1940, as
amended (the "Investment Company Act").
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4. CERTAIN COVENANTS. The Company hereby agrees:
(a) to furnish such information as may be required and
otherwise to cooperate in qualifying the Shares for offering and sale under the
securities or blue sky laws of such states as you may designate and to maintain
such qualifications in effect so long as required for the distribution of the
Shares; provided that the Company shall not be required to qualify as a foreign
corporation or to take any action that would subject it to service of process
under the laws of any such state, (other than those arising out of the offering
and sale of the Shares); and to promptly advise you of the receipt of any
notification with respect to the suspension of the qualification of the Shares
for sale in any jurisdiction or the initiation or threatening of any proceeding
for such purpose;
(b) to make available to the Underwriters in New York City, as
soon as practicable after the Registration Statement becomes effective, and
thereafter from time to time for so long as in the reasonable opinion of counsel
for the Underwriters a prospectus is required by the Act to be delivered in
connection with sales by the Underwriters or any dealer, to furnish to the
Underwriters, as many copies of the Prospectus (or of the Prospectus as amended
or supplemented if the Company shall have made any amendments or supplements
thereto after the effective date of the Registration Statement) as the
Underwriters may request for the purposes contemplated by the Act; in case in
the reasonable opinion of Counsel for the Underwriters any Underwriter is
required to deliver a prospectus beyond the nine-month period referred to in
Section 10(a)(3) of the Act in connection with the sale of the Shares, the
Company will prepare promptly upon request and at its cost such amendment or
amendments to the Registration Statement and such prospectuses as may be
necessary to permit compliance with the requirements of Section 10(a)(3) of the
Act;
(c) to advise you promptly and (if requested by you) to
confirm such advice in writing, (i) when the Registration Statement has become
effective and when any post-effective amendment thereto becomes effective and
(ii) if Rule 430A under the Act is used, when the Prospectus is filed with the
Commission pursuant to Rule 424(b) under the Act (which the Company agrees to
file in a timely manner under such Rules);
(d) to advise you promptly, confirming such advice in writing,
of any request by the Commission for amendments or supplements to the
Registration Statement or Prospectus or for additional information with respect
thereto, or of notice of institution of proceedings for, or the entry of a stop
order suspending the effectiveness of the Registration Statement and, if the
Commission should enter a stop order suspending the effectiveness of the
Registration Statement, to use its best efforts to obtain the lifting or removal
of such order as soon as possible; to advise you promptly of any proposal to
amend or supplement the Registration Statement or Prospectus and to file no such
amendment or supplement to which you shall reasonably object in writing within a
reasonable period of time after notice from the Company;
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(e) subject to Section 4(o) hereof, to file promptly all
reports and any definitive proxy or information statement required to be filed
by the Company with the Commission in order to comply with the Exchange Act
subsequent to the date of the Prospectus and for so long as the delivery of a
prospectus is required in connection with the offering or sale of the shares,
(f) if necessary or appropriate, to file in a timely fashion a
registration statement pursuant to Rule 462(b) under the Act;
(g) to furnish to you and, upon request, to each of the other
Underwriters for a period of five years from the date of this Agreement (i)
copies of any reports or other communications which the Company shall send to
its stockholders or shall from time to time publish or publicly disseminate,
except for such materials as are filed and are publicly accessible via ▇▇▇▇▇
copies of documents or reports filed with any national securities exchange on
which any class of securities of the Company is listed and are not available on
▇▇▇▇▇ and (iii) such other information as you may reasonably request regarding
the Company as soon as such communications, documents or information becomes
available;
(h) to advise the Underwriters promptly of the occurrence of
any event known to the Company within the time during which a Prospectus
relating to the Shares is required to be delivered under the Act which would, in
the reasonable judgment of the Company or the reasonable opinion of Counsel to
the Underwriters, require the making of any change in the Prospectus then being
used so that the Prospectus would not include an untrue statement of a material
fact or omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they are made, not misleading,
and, during such time, to prepare and furnish promptly to the underwriters, at
no expense to the Underwriters, such amendments or supplements to such
Prospectus as may be necessary to reflect any such change and to furnish you a
copy of such proposed amendment or supplement before filing any such amendment
or supplement with the Commission;
(i) to make generally available to its security holders, and
to deliver to you, as soon as practicable an earnings statement of the Company
(which will satisfy the provisions of Section 11(a) of the Act) covering a
period of twelve months beginning after the effective date of the Registration
Statement (as defined in Rule 158(c) of the Act) and ending not later than 15
months thereafter;
(j) to furnish to its shareholders as soon as practicable
after the end of each fiscal year an annual report (including a balance sheet
and statements of income, shareholders' equity and of cash flow of the Company
for such fiscal year, accompanied by a copy of the certificate or report thereon
of nationally recognized independent certified public accountants);
12
(k) to furnish to you such number of conformed copies of the
Registration Statement, as initially filed with the Commission, and of all
amendments thereto (including all exhibits thereto) as you shall reasonably
request and sufficient conformed copies of the foregoing (other than exhibits)
for distribution to each of the other Underwriters;
(l) to apply the net proceeds from the sale of the Shares
substantially in the manner set forth under the caption "Use of Proceeds" in the
Prospectus;
(m) to pay all costs, expenses, fees and taxes in connection
with (i) the preparation and filing of the Registration Statement, each
Preliminary Prospectus, the Prospectus, and any amendments or supplements
thereto, and the printing and furnishing of copies of each thereof to the
Underwriters and to dealers (including costs of mailing and shipment), (ii) the
registration, issue, sale and delivery of the Shares, (iii) the producing, word
processing and/or printing of this Agreement, any Agreement Among Underwriters,
any dealer agreements, any Powers of Attorney and any closing documents
(including compilations thereof) and the reproduction and/or printing and
furnishing of copies of each thereof to the Underwriters and (except closing
documents) to dealers (including costs of mailing and shipment), (iv) the
qualification of the Shares for offering and sale under state laws and the
determination of their eligibility for investment under state law as aforesaid
(including the reasonable legal fees and filing fees and other disbursements of
counsel for the Underwriters) and the printing and furnishing of copies of any
blue sky surveys or legal investment surveys to the Underwriters and to dealers,
(v) any listing of the Shares on any securities exchange or qualification of the
Shares for quotation on NASDAQ and any registration thereof under the Exchange
Act, (vi) any filing for review of the public offering of the Shares by the NASD
and (vii) the performance of the Company's other obligations hereunder, provided
that except as set forth in this section 3(m), you shall pay your own costs and
expenses, including the costs and expenses of your own counsel, any transfer
taxes on the Firm Shares and Additional Shares that you may sell and the
expenses of advertising any offering of the Firm Shares and Additional Shares
made by you;
(n) to furnish to you, before filing with the Commission
subsequent to the effective date of the Registration Statement and during the
period referred to in paragraph (h) above, subject to appropriate assurances
regarding confidentiality, a copy of any document proposed to be filed pursuant
to Section 13, 14 or 15(d) of the Exchange Act;
(o) not to sell, offer to sell, contract to sell, hypothecate,
pledge, grant any option to sell or otherwise dispose of, directly or
indirectly, any shares of Common Stock or securities convertible into or
exchangeable or exercisable for Common Stock or warrants or other rights to
purchase Common Stock or any other shares of the Company that are substantially
similar to Common Stock or permit the registration under the Act of any shares
of Common Stock for a period of 180 days after the date hereof (the "Lock-up
Period"), without the prior written consent of ▇▇▇▇▇▇, except for (i) the
registration of the Shares and the sales to the Underwriters pursuant to this
Agreement, (ii) issuances of Common Stock
13
upon the exercise of outstanding options or warrants as disclosed in the
Registration Statement and the Prospectus, and (iii) the issuance of employee
stock options not exercisable during the Lock-up Period pursuant to stock option
plans described in the Registration Statement and the Prospectus; and
(p) to use its best efforts to cause the Common Stock to be
listed for quotation on the National Association of Securities Dealers Automated
Quotation National Market System ("NASDAQ").
5. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. The Company agrees
that if the Shares are not delivered for any reason other than the termination
of this Agreement pursuant to subsections (ii), (iii) or (iv) of the second
paragraph of Section 7 hereof or the last paragraph of Section 8 hereof or the
default by one or more of the Underwriters in its or their respective
obligations hereunder, it shall, in addition to paying the amounts described in
Section 4(n) hereof, reimburse the Underwriters for all of the out-of-pocket
accountable expenses actually incurred by the Underwriters, including the
reasonable fees and disbursements of their counsel, but the Company shall not in
any event be liable to the Underwriters for damages on account of loss of
anticipated profits from the sale of he Firm Shares or the Additional Shares.
6. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several
obligations of the Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company on the date hereof and at the time
of purchase (and the several obligations of the Underwriters at the time of
additional purchase are subject to the accuracy of the representations and
warranties of the Company on the date hereof and at the additional time of
purchase), the performance by the Company of its obligations hereunder and to
the following additional conditions precedent:
(a) The Company shall furnish to you at the time of purchase
and at the additional time of purchase, as the case may be, an opinion of
O'Melveny & ▇▇▇▇▇ LLP, special counsel for the Company, addressed to the
Underwriters, and dated the time of purchase or the additional time of purchase,
as the case may be, with reproduced copies for each of the other Underwriters
and substantially in the form of Annex A hereto:
(b) You shall have received at the time of purchase and at the
additional time of purchase, as the case may be, the favorable opinion of ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ LLP, counsel for the Underwriters, dated the time of purchase or the
additional time of purchase, as the case may be, with respect to the issuance
and sale of the Shares by the Company, the Registration Statement, the
Prospectus (together with any supplement thereto) and such other related matters
as the Underwriters may require.
(c) You shall have received from PricewaterhouseCoopers LLP,
letters dated, respectively, the date of this Agreement and the time of purchase
and additional time of
14
purchase, as the case may be, and addressed to the Underwriters (with reproduced
copies for each of the Underwriters) in the forms heretofore approved by ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ LLP, counsel for the Underwriters.
(d) No amendment or supplement to the Registration Statement
or Prospectus shall be filed prior to the time the Registration Statement
becomes effective to which you object in writing.
(e) The Registration Statement shall become effective, or if
Rule 430A under the Act is used, the Prospectus shall have been filed with the
Commission pursuant to Rule 424(b) under the Act, at or before 5:30 P.M., New
York City time, on the date of this Agreement, unless a later time (but not
later than 5:30 P.M., New York City time, on the second full business day after
the date of this Agreement) shall be agreed to by the Company and you in writing
or by telephone, confirmed in writing; PROVIDED, HOWEVER, that the Company and
you and any group of Underwriters, including you, who have agreed hereunder to
purchase in the aggregate at least 50% of the Firm Shares may from time to time
agree on a later date.
(f) Prior to the time of purchase or the additional time of
purchase, as the case may be, (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued under the Act
or proceedings initiated under Section 8(d) or 8(e) of the Act; (ii) the
Registration Statement and all amendments thereto, or modifications thereof, if
any, shall not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading; and (iii) the Prospectus and all amendments or
supplements thereto, or modifications thereof, if any, shall not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in the light of
the circumstances under which they are made, not misleading.
(g) Between the time of execution of this Agreement and the
time of purchase or the additional time of purchase, as the case may be, (i) no
material and unfavorable change, or any development involving a prospective
material and adverse change, financial or otherwise (other than as specifically
identified in the Registration Statement and Prospectus), in the business,
properties, condition or results of operations of the Company shall occur or
become known and (ii) no transaction which is material and unfavorable to the
Company shall have been entered into by the Company.
(h) The Company will, at the time of purchase or additional
time of purchase, as the case may be, deliver to you a certificate of its
President and its Chief Financial Officer to the effect that the representations
and warranties of the Company as set forth in this Agreement are true and
correct as of each such date, that the Company has performed such of their
obligations under this Agreement as are to be performed at or before
15
the time of purchase and at or before the additional time of purchase, as the
case may be, and the conditions set forth in paragraphs (g), (h) and (i) of this
Section 6 have been met.
(i) You shall have received signed letters, dated the date of
this Agreement, from each of the officers and directors of the Company and the
stockholders of the Company listed on Schedule __ agreeing with the Underwriters
that such persons will not sell, offer or agree to sell, contract to sell,
hypothecate, pledge, grant any option to sell or otherwise dispose of, directly
or indirectly, any shares of Common Stock of the Company or securities
convertible into or exchangeable or exercisable for Common Stock or warrants or
other rights to purchase Common Stock or any other securities of the Company
that are substantially similar to the Common Stock for a period of 180 days
after the date of the Prospectus without ▇▇▇▇▇▇'▇ prior written consent; subject
to certain exceptions set forth in these agreements.
(j) The Shares shall have been approved for listing for
quotation on NASDAQ, subject only to notice of issuance at or prior to the time
of purchase or the additional time of purchase, as the case may be.
7. EFFECTIVE DATE OF AGREEMENT; TERMINATION. This Agreement
shall become effective (i) if Rule 430A under the Act is not used, when you
shall have received notification of the effectiveness of the Registration
Statement, or (ii) if Rule 430A under the Act is used, when the parties hereto
have executed and delivered this Agreement.
The obligations of the several Underwriters hereunder shall be
subject to termination in the absolute discretion of you or any group of
Underwriters (which may include you) which has agreed to purchase in the
aggregate at least 50% of the Firm Shares, (i) if, since the time of execution
of this Agreement or the respective dates as of which information is given in
the Registration Statement and Prospectus, there has been any material adverse
and unfavorable change, or any development involving a prospective material
adverse change, financial or otherwise (other than as specifically identified in
the Registration Statement and Prospectus), in the business properties,
condition or results of operations of the Company which would, in your judgment
or in the judgment of such group of Underwriters, make it impracticable to
market the Shares, or, (ii) if, at any time prior to the time of purchase or,
with respect to the purchase of any Additional Shares, the additional time of
purchase, as the case may be, trading in securities on the Nasdaq National
Market shall have been suspended or limitations or minimum prices shall have
been established on the Nasdaq National Market, or (iii) if a banking moratorium
shall have been declared either by the United States or New York State
authorities, or (iv) if the United States shall have declared war in accordance
with its constitutional processes or there shall have occurred any material
outbreak or escalation of hostilities or other national or international
calamity or crisis of such magnitude in its effect on the financial markets of
the United States as, in your reasonable judgment or in the reasonable judgment
of such group of Underwriters, to make it impracticable to market the Shares.
16
If you or any group of Underwriters elects to terminate this
Agreement as provided in this Section 7, the Company and each other Underwriter
shall be notified promptly by letter or telecopy.
If the sale to the Underwriters of the Shares, as contemplated
by this Agreement, is not carried out by the Underwriters for any reason
permitted under this Agreement or if such sale is not carried out because the
Company shall be unable to comply with any of the terms of this Agreement, the
Company shall not be under any obligation or liability under this Agreement
(except to the extent provided in Sections 4(n), 5 and 9 hereof), and the
Underwriters shall be under no obligation or liability to the Company under this
Agreement (except to the extent provided in Section 9 hereof) or to one another
hereunder.
8. INCREASE IN UNDERWRITERS' COMMITMENTS. Subject to Sections
6 and 7, if any Underwriter shall default in its obligation to take up and pay
for the Firm Shares to be purchased by it hereunder (otherwise than for a reason
sufficient to justify the termination of this Agreement under the provisions of
Section 7 hereof) and if the number of Firm Shares which all Underwriters so
defaulting shall have agreed but failed to take up and pay for does not exceed
10% of the total number of Firm Shares, the non-defaulting Underwriters shall
take up and pay for (in addition to the aggregate number of Firm Shares they are
obligated to purchase pursuant to Section 1 hereof) the number of Firm Shares
agreed to be purchased by all such defaulting Underwriters, as hereinafter
provided. Such Shares shall be taken up and paid for by such non-defaulting
Underwriter or Underwriters in such amount or amounts as you may designate with
the consent of each Underwriter so designated or, in the event no such
designation is made, such Shares shall be taken up and paid for by all
non-defaulting Underwriters pro rata in proportion to the aggregate number of
Firm Shares set opposite the names of such non-defaulting Underwriters in
Schedule A.
Without relieving any defaulting Underwriter from its
obligations hereunder, the Company agrees with the non-defaulting Underwriters
that it will not sell any Firm Shares hereunder unless all of the Firm Shares
are purchased by the Underwriters (or by substituted Underwriters selected by
you with the approval of the Company or selected by the Company with your
approval).
If a new Underwriter or Underwriters are substituted by the
Underwriters or by the Company for a defaulting Underwriter or Underwriters in
accordance with the foregoing provision, the Company or you shall have the right
to postpone the time of purchase for a period not exceeding five business days
in order that any necessary changes in the Registration Statement and Prospectus
and other documents may be effected.
The term Underwriter as used in this Agreement shall refer to
and include any Underwriter substituted under this Section 8 with like effect as
if such substituted Underwriter had originally been named in Schedule A.
17
If the aggregate number of Shares which the defaulting
Underwriter or Underwriters agreed to purchase exceeds 10% of the total number
of Shares which all Underwriters agreed to purchase hereunder, and if neither
the non-defaulting Underwriters nor the Company shall make arrangements within
the five business day period stated above for the purchase of all the Shares
which the defaulting Underwriter or Underwriters agreed to purchase hereunder,
this Agreement shall be terminated without further act or deed and without any
liability on the part of the Company to any non-defaulting Underwriter and
without any liability on the part of any non-defaulting Underwriter to the
Company. Nothing in this paragraph, and no action taken hereunder, shall relieve
any defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
9. INDEMNITY AND CONTRIBUTION.
(a) 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 Act, and the successors and assigns of
all of the foregoing persons; from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof (including, but
not limited to, any loss, claim, damage, liability or action relating to
purchases and sales of the Shares), to which that Underwriter, or any such
person may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus or in any amendment or supplement thereto, or (B) in any materials or
information provided to investors by, or with the approval of, the Company in
connection with the marketing of the offering of the Shares ("Marketing
Materials"), including any roadshow or investor presentations made to investors
by the Company (whether in person or electronically), or (ii) any untrue
statement or alleged untrue statement of a material fact contained in any
material prepared by or with the approval of the Company for distribution to
Directed Share Participants in connection with the Directed Share Program or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
(iii) the failure of any Directed Share Program participant to pay for and
accept delivery of Directed Shares that the Participant agreed to purchase or
(iv) is otherwise related to the Directed Share Program, other than losses,
claims, damages or liabilities (or expenses relating thereto) that are finally
judicially determined to have resulted directly from the bad faith or gross
negligence of ▇▇▇▇▇▇ Brothers or (v) the omission or alleged omission to state
in any Preliminary Prospectus, the Registration Statement or the Prospectus, or
in any amendment or supplement thereto, any material fact required to be stated
therein or necessary to make the statements therein not misleading 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 Shares 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 matters
covered by clause (i), (ii), (iii),
18
(iv) or (v) above (provided that the Company shall not be liable under this
clause (vi) to the extent that it is determined in a final judgment by a court
of competent jurisdiction 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 gross negligence or willful
misconduct), and shall reimburse each Underwriter and each such officer,
employee or controlling person promptly upon demand for any legal or other
expenses reasonably incurred by that Underwriter, officer, employee or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred; provided however that the indemnification contained in
this paragraph (a) with respect to any Preliminary Prospectus shall not inure to
the benefit of the Underwriters (or to the benefit of their respective partners,
directors, officers and controlling persons) on account of any such loss, claim,
damage, liability or expense arising from the sale of the Firm Shares or the
Additional Shares by the Underwriters to any person if a copy of the Prospectus
shall not have been delivered or sent to such person within the time required by
the Act and the regulations thereunder, and the untrue statement or alleged
untrue statement or omission or alleged omission of a material fact contained in
such Preliminary Prospectus was corrected in the Prospectus.
(b) If any action, suit or proceeding (together, a
"Proceeding") is brought against an Underwriter or any such person in respect of
which indemnity may be sought against the Company pursuant to the foregoing
paragraph, such Underwriter or such person shall promptly notify the Company in
writing of the institution of such Proceeding and the Company shall assume the
defense of such Proceeding, including the employment of counsel reasonably
satisfactory to such indemnified party and payment of all fees and expenses;
PROVIDED, HOWEVER, that the omission to so notify the Company shall not relieve
the Company from any liability which the Company may have to any Underwriter or
any such person or otherwise to the extent that the Company is not materially
prejudiced by such failure. Such Underwriter or such person shall have the right
to employ its or their own counsel in any such case, but the fees and expenses
of such counsel shall be at the expense of such Underwriter or of such person
unless (i) the employment of such counsel shall have been authorized in writing
by the Company in connection with the defense of such Proceeding, (ii) the
Company shall not have, within a reasonable period of time in light of the
circumstances, employed counsel to defend such Proceeding, or (iii) the named
parties to any such action, suit or proceeding (including any impleaded parties)
include both the Company and the Underwriters or such person, and the Company
and the Underwriters or such person shall have been advised by its counsel that
representation of such indemnified party and the Company by the same counsel
would be inappropriate under applicable standards of professional conduct
(whether or not such representation by the same counsel has been proposed) due
to actual or potential differing interests between them (in which case the
Company shall not have the right to direct the defense of such Proceeding on
behalf of the indemnified party or parties), in any of which events such fees
and expenses shall be borne by the Company and paid as incurred (it being
understood, however, that the Company shall not
19
be liable for the expenses of more than one separate counsel (in addition to any
local counsel) in any one Proceeding or series of related Proceedings in the
same jurisdiction representing the indemnified parties who are parties to such
Proceeding). The Company shall not be liable for any settlement of any
Proceeding effected without the written consent of the Company but if settled
with the written consent of the Company, the Company agrees to indemnify and
hold harmless any Underwriter and any such person from and against any loss or
liability by reason of such settlement to the extent provided in the preceding
paragraph. No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened Proceeding
in respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party, unless
such settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such Proceeding and does
not include an admission of fault, culpability or a failure to act, by or on
behalf of such indemnified party.
(c) Each Underwriter severally agrees to indemnify, defend and
hold harmless the Company, its directors and officers, and any person who
controls the Company within the meaning of Section 15 of the Act or Section 20
of the Exchange Act, and the successors and assigns of all of the foregoing
persons from and against any loss, damage, expense, liability or claim
(including the reasonable cost of investigation) which, jointly or severally,
the Company or any such person may incur under the Act, the Exchange Act, the
common law or otherwise, insofar as such loss, damage, expense, liability or
claim arises out of or is based upon any untrue statement or alleged untrue
statement of a material fact contained in and in conformity with information
furnished in writing by or on behalf of such Underwriter through you to the
Company expressly for use with reference to such Underwriter in the Registration
Statement (or in the Registration Statement as amended by any post-effective
amendment thereof by the Company) or in a Prospectus Preliminary Prospectus or
Marketing Materials, or arises out of or is based upon any omission or alleged
omission to state a material fact in connection with such information required
to be stated in such Registration Statement or such Prospectus or necessary to
make such information not misleading.
(d) If any Proceeding is brought against the Company or any
such person in respect of which indemnity may be sought against any Underwriter
pursuant to the foregoing paragraph, the Company or such person shall promptly
notify such Underwriter in writing of the institution of such Proceeding and
such Underwriter shall assume the defense of such Proceeding, including the
employment of counsel reasonably satisfactory to such indemnified party and
payment of all fees and expenses; PROVIDED, HOWEVER, that the omission to so
notify such Underwriter shall not relieve such Underwriter from any liability
which such Underwriter may have to the Company or any such person or otherwise.
The Company or such person shall have the right to employ its own counsel in any
such case, but the fees and expenses of such counsel shall be at the expense of
the Company or such person unless the employment of such counsel shall have been
authorized in writing by such Underwriter in
20
connection with the defense of such Proceeding or such Underwriter shall not
have, within a reasonable period of time in light of the circumstances, employed
counsel to have charge of the defense of such Proceeding or such indemnified
party or parties shall have reasonably concluded that there may be defenses
available to it or them which are different from or additional to or in conflict
with those available to such Underwriter (in which case such Underwriter shall
not have the right to direct the defense of such Proceeding on behalf of the
indemnified party or parties, but such Underwriter may employ counsel and
participate in the defense thereof but the fees and expenses of such counsel
shall be at the expense of such Underwriter), in any of which events such fees
and expenses shall be borne by such Underwriter and paid as incurred (it being
understood, however, that such Underwriter shall not be liable for the expenses
of more than one separate counsel (in addition to any local counsel) in any one
Proceeding or series of related Proceedings in the same jurisdiction
representing the indemnified parties who are parties to such Proceeding). No
Underwriter shall be liable for any settlement of any such Proceeding effected
without the written consent of such Underwriter but if settled with the written
consent of such Underwriter, such Underwriter agrees to indemnify and hold
harmless the Company and any such person from and against any loss or liability
by reason of such settlement. Notwithstanding the foregoing sentence, if at any
time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the second sentence of this paragraph, then the indemnifying party agrees
that it shall be liable for any settlement of any Proceeding effected without
its written consent if (i) such settlement is entered into more than 60 days
after receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement and (iii) such
indemnified party shall have given the indemnifying party at least 30 days'
prior notice of its intention to settle. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any settlement of any
pending or threatened Proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such Proceeding.
(e) If the indemnification provided for in this Section 9 is
unavailable to an indemnified party under subsections (a), (b) or (c) of this
Section 9 in respect of any losses, damages, expenses, liabilities or claims
referred to therein, then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, damages, expenses,
liabilities or claims (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the Underwriters
on the other hand from the offering of the Shares 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 on the one
hand and of the
21
Underwriters on the other in connection with the statements or omissions which
resulted in such losses, damages, expenses, liabilities or claims, as well as
any other relevant equitable considerations. The relative benefits received by
the Company on the one hand and the Underwriters on the other shall be deemed to
be in the same respective proportions as the total proceeds from the offering
(net of underwriting discounts and commissions but before deducting expenses)
received by the Company and the total underwriting discounts and commissions
received by the Underwriters, bear to the aggregate public offering price of the
Shares. The relative fault of the Company on the one hand and of the
Underwriters on the other shall be determined by reference to, among other
things, whether the untrue statement or alleged untrue statement of a material
fact or omission or alleged omission relates to information supplied by the
Company or by the Underwriters 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,
damages, expenses, liabilities and claims referred to in this subsection shall
be deemed to include any legal or other fees or expenses reasonably incurred by
such party in connection with investigating, preparing to defend or defending
any Proceeding.
(f) The Company 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 that does not take account of
the equitable considerations referred to in subsection (c) above.
Notwithstanding the provisions of this Section 9, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by such Underwriter and distributed to
the public were offered to the public exceeds the amount of any damage which
such Underwriter has otherwise been required to pay by reason of such untrue
statement or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Underwriters' obligations to contribute
pursuant to this Section 9 are several in proportion to their respective
underwriting commitments and not joint.
(g) The indemnity and contribution agreements contained in
this Section 9 and the covenants, warranties and representations of the Company
contained in this Agreement shall remain in full force and effect regardless of
any investigation made by or on behalf of any Underwriter, its partners,
directors or officers or any person (including each partner, officer or director
of such person) who controls any Underwriter within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act, or by or on behalf of the Company its
directors or officers or any person who controls the Company within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act, and shall survive
any termination of this Agreement or the issuance and delivery of the Shares
provided that, if the Underwriters with actual knowledge of (i) a default in any
of the covenants, agreements or
22
obligations to be performed by the Company under this Agreement or any closing
documents, and/or (ii) any breach of any representation or warranty made in this
Agreement or any closing document, nonetheless elects to proceed to closing,
then upon the consummation of the Closing, the Underwriters shall be deemed to
have waived any such default and breach and shall have no claim against the
Company with respect thereto, nor any termination right hereunder by reason
thereof. The Company and each Underwriter agree promptly to notify each other of
the commencement of any Proceeding against it and, in the case of the Company,
against any of the Company's officers or directors in connection with the
issuance and sale of the Shares, or in connection with the Registration
Statement or Prospectus.
10. NOTICES. Except as otherwise herein provided, all
statements, requests, notices and agreements shall be in writing or by telegram
and, if to the Underwriters, shall be sufficient in all respects if delivered or
sent to ▇▇▇▇▇▇ Brothers, ▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇,
Attention: Syndicate Department and, if to the Company, shall be sufficient in
all respects if delivered or sent to the Company at the offices of the Company
at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇ III, President and CEO.
11. GOVERNING LAW; CONSTRUCTION. This Agreement and any claim,
counterclaim or dispute of any kind or nature whatsoever arising out of or in
any way relating to this Agreement ("Claim"), directly or indirectly, shall be
governed by, and construed in accordance with, the laws of the State of New
York. The Section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this Agreement.
12. SUBMISSION TO JURISDICTION. Except as set forth below, no
Claim may be commenced, prosecuted or continued in any court other than the
courts of the State of New York located in the City and County of New York or in
the United States District Court for the Southern District of New York, which
courts shall have jurisdiction over the adjudication of such matters, and the
Company consents to the jurisdiction of such courts and personal service with
respect thereto. The Company hereby consents to personal jurisdiction, service
and venue in any court in which any Claim arising out of or in any way relating
to this Agreement is brought by any third party against ▇▇▇▇▇▇ or any
indemnified party. Each of ▇▇▇▇▇▇ and the Company (on their respective behalf
and, to the extent permitted by applicable law, on behalf of their respective
stockholders and affiliates) waives all right to trial by jury in any action,
proceeding or counterclaim (whether based upon contract, tort or otherwise) in
any way arising out of or relating to this Agreement. The Company agrees that a
final judgment in any such action, proceeding or counterclaim brought in any
such court shall be conclusive and binding upon the Company and may be enforced
in any other courts in the jurisdiction of which the Company is or may be
subject, by suit upon such judgment.
13. PARTIES AT INTEREST. The Agreement herein set forth has
been and is made solely for the benefit of the Underwriters and the Company and
to the extent provided
23
in Section 9 hereof the controlling persons, directors and officers referred to
in such section, and their respective successors, assigns, heirs, personal
representatives and executors and administrators. No other person, partnership,
association or corporation (including a purchaser, as such purchaser, from any
of the Underwriters) shall acquire or have any right under or by virtue of this
Agreement.
14. COUNTERPARTS. This Agreement may be signed by the parties
in one or more counterparts which together shall constitute one and the same
agreement among the parties.
15. SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon the Underwriters, the Company and their successors and assigns and any
successor or assign of any substantial portion of the Company's, and any of the
Underwriters' respective businesses and/or assets.
24
If the foregoing correctly sets forth the understanding among
the Company and the Underwriters, please so indicate in the space provided below
for the purpose, whereupon this letter and your acceptance shall constitute a
binding agreement among the Company and the Underwriters, severally.
Very truly yours,
VERSICOR INC.
By:
-----------------------------------------
Name:
Title:
Accepted and agreed to as of the
date first above written, on behalf of
themselves and the other several Underwriters
named in Schedule A
▇▇▇▇▇▇ BROTHERS INC.
CHASE SECURITIES INC.
PACIFIC GROWTH EQUITIES, INC.
UBS WARBURG LLC
FIDELITY CAPITAL MARKETS, a division of National Financial Services Corporation
By: ▇▇▇▇▇▇ BROTHERS INC.
By:
--------------------
Name:
Title: Managing Director
25
SCHEDULE A
Number of
Underwriter Firm Shares
----------- -----------
▇▇▇▇▇▇ BROTHERS INC........................................................
CHASE SECURITIES INC.......................................................
PACIFIC GROWTH EQUITIES, INC. .............................................
UBS WARBURG LLC. .....................................................
FIDELITY CAPITAL MARKETS, a division of National Financial Services
Corporation.........................................................
Total....................... _________
=====================
26
ANNEX A
OPINION OF COMPANY COUNSEL
(i) the Company has been duly incorporated and is validly
existing as a corporation and is in good standing under the laws of the State of
Delaware, with corporate power to own, lease and operate its properties and
conduct its business as described in the Registration Statement and the
Prospectus, to execute and deliver this Agreement and to issue, sell and deliver
the Shares as herein contemplated;
(ii) the Company is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction in which the ownership
or leasing of its properties or the conduct of its business requires such
qualification, except where the failure to so qualify would not individually or
in the aggregate have a Material Adverse Effect;
(iii) this Agreement has been duly authorized by all necessary
corporate action on the part of the Company, and has been duly executed and
delivered by the Company;
(iv) the Shares have been duly authorized by all necessary
corporate action on the part of the Company and, when issued and delivered to
and paid for by the Underwriters, will be validly issued, fully paid and
non-assessable;
(v) the Company has authorized shares of capital stock as set
forth in the Registration Statement and the Prospectus; the Shares when issued
will be free of preemptive rights under the Company's Certificate of
Incorporation and Bylaws and under the corporate law of the State of Delaware;
(vi) the Registration Statement, on the date it was filed, and
the Prospectus (except as to the financial statements and schedules and other
financial and statistical data contained therein, as to which such counsel need
express no opinion) comply as to form in all material respects with the
requirements as to form for registration statements on Form S-1 under the Act;
(vii) the Registration Statement has become effective under
the Act and, to such counsel's knowledge, no stop order proceedings with respect
thereto are pending or threatened under the Act and any required filing of the
Prospectus, and any supplement thereto pursuant to Rule 424 under the Act has
been made in the manner and within the time period required by such Rule 424;
(viii) no order, consent, permit or approval of any
California, Delaware or federal governmental authority is required on the part
of the Company in connection with the execution and delivery of this Agreement
or the issuance and sale of the Shares, other than
A-27
registration of the Shares under the Act and other than any necessary
qualification under the state securities or blue sky laws or foreign securities
laws of the various jurisdictions in which the Shares are being offered by the
Underwriters, as to which such qualification such counsel need express no
opinion, and as required by the National Association of Securities Dealers,
LLC.;
(ix) the execution, delivery and performance of this agreement
by the Company and the transactions contemplated hereby and by the Registration
Statement do not and will not violate, or result in any breach of, or constitute
a default under (nor constitute any event which with notice, lapse of time, or
both, would result in any breach of, or constitute a default under), any
provisions of the charter or bylaws or other organizational documents of the
Company or under any provision of any license, permit, franchise, indenture,
mortgage, deed of trust, bank loan or credit agreement or other evidence of
indebtedness, or any lease, contract or other agreement or instrument to which
the Company is a party or by which its properties may be bound or affected that
is filed as an exhibit to the Registration Statement or under Delaware General
Corporation Law, any federal or California law, regulation or rule that such
counsel has, in the exercise of customary professional diligence, recognized as
applicable to the company or to transactions of the type contemplated by the
Agreement, or under the, or any decree, judgment or order applicable to the
Company and known to such counsel, except that such counsel does not have to
express any opinion regarding federal securities law, or Blue Sky or state
securities laws or the indemnification provisions of this Agreement except as
otherwise expressly stated in such opinion;
(x) to such counsel's knowledge, there are no contracts,
licenses, agreements, leases or documents of a character which are required to
be filed as exhibits to the Registration Statement which have not been so filed;
(xi) the Company is not, and after the offering and sale of
the Shares, will not be, an "investment company";
(xii) the statements in the Registration Statement and
Prospectus, under the caption "Description of Capital Stock" insofar as they
summarize provisions of the Certificate of Incorporation and Bylaws of the
Company constitute a fair summary thereof;
In addition, such counsel shall state that it has participated
in conferences with officers and other representatives of the Company,
representatives of the independent public accountants of the Company and
representatives of the Underwriters at which the contents of the Registration
Statement and Prospectus were discussed and, although such counsel is not
passing upon and does not assume responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration Statement or
Prospectus (except as and to the extent stated in subparagraphs (vi) and (xii)
above), on the basis of the foregoing nothing has come to the attention of such
counsel that causes them to believe that the Registration Statement or any
amendment thereto at the time such Registration Statement or amendment
A-28
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 or any supplement
thereto at the date of such Prospectus or such supplement, and at all times up
to and including the time of purchase or additional time of purchase, as the
case may be, 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, in light of the circumstances under which they were made,
not misleading (it being understood that such counsel need express no opinion
with respect to the financial statements and schedules and other financial and
statistical data included in the Registration Statement or Prospectus).
A-29