Cowen & Co.,
LLC
Lazard Capital Markets
LLC
As Representatives of the several
Underwriters
c/o Cowen & Co., LLC
1221 Avenue of the Americas
New York, New York 10020
1. Introductory . Artes Medical,
Inc., a Delaware corporation (the “Company”), proposes
to sell, pursuant to the terms of this Agreement, to the several
underwriters named in Schedule A hereto (the
“Underwriters,” or, each, an
“Underwriter”), an aggregate of [___] shares of common
stock, $0.001 par value (the “Common Stock”) of the
Company. The aggregate of [___] shares so proposed to be sold is
hereinafter referred to as the “Firm Stock”. The
Company also proposes to sell to the Underwriters, upon the terms
and conditions set forth in Section 3 hereof, up to an
additional [___] shares of Common Stock (the “Optional
Stock”). The Firm Stock and the Optional Stock are
hereinafter collectively referred to as the “Stock”.
Cowen & Co., LLC (“Cowen”) and Lazard Capital
Markets LLC (“Lazard”) are acting as representatives of
the several Underwriters and in such capacity are hereinafter
referred to as the “Representatives.”
As part of the
offering contemplated by this Agreement, [Cowen] (the
“Designated Underwriter”) has agreed to reserve out of
the Firm Stock purchased by it under this Agreement up to [___]
shares for sale to the Company’s and its subsidiaries’
officers, directors, employees, customers and business partners and
friends of the Company’s and its subsidiaries’
officers, directors and employees (collectively,
“Participants”), as set forth in the Prospectus (as
defined herein) under the heading “Underwriting” (the
“Directed Share Program”). The Firm Stock to be sold by
the Designated Underwriter pursuant to the Directed Share Program
(the “Directed Shares”) will be sold by the Designated
Underwriter pursuant to this Agreement at the public offering
price. Any Directed Shares not subscribed for by the end of the
business day on which this Agreement is executed will be offered to
the public by the Underwriters as set forth in the
Prospectus.
2. Representations and Warranties of the
Company
(I)
Representations and
Warranties of the Company . The Company represents and
warrants to the several Underwriters and the Designated
Underwriter, as of the date hereof and as of each Closing Date, and
agrees with the several Underwriters and the Designated
Underwriter, that:
(a) A
registration statement of the Company on Form S-1 (File
No. 333-___) (including all pre-effective amendments thereto,
the “Initial Registration Statement”) in respect of the
Stock has been filed with the Securities and Exchange Commission
(the “Commission”). The Company meets the requirements
for use of Form S-1 under the Securities Act of 1933, as amended
(the “Securities Act”), and the rules and regulations
of the Commission thereunder (the “Rules and
Regulations”). The Initial Registration Statement and any
post-effective amendment thereto, each in the form heretofore
delivered to you for each of the Underwriters, and, excluding
exhibits thereto, have been declared effective by the Commission in
such form and meet the requirements of the Securities Act, and the
Rules and Regulations. Other than a registration statement, if any,
increasing the size of the offering filed pursuant to Rule 462(b)
under the Securities Act and the Rules and Regulations (a
“Rule 462(b) Registration Statement”) and the
Prospectus (as defined below) contemplated hereby to be filed
pursuant to Rule 424(b) under the Securities Act in
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accordance with
Section 4(I)(a) hereof, no other document with respect to the
Initial Registration Statement or the offer and sale of the Stock
has heretofore been filed with the Commission or distributed. No
stop order suspending the effectiveness of the Initial Registration
Statement, any post-effective amendment thereto or the Rule 462(b)
Registration Statement, if any, has been issued and no proceeding
for that purpose or pursuant to Section 8A has been initiated or
threatened by the Commission (any preliminary prospectus included
in the Initial Registration Statement or filed with the Commission
pursuant to Rule 424(a) of the Rules and Regulations is hereinafter
called a “Preliminary Prospectus”). The various parts
of the Initial Registration Statement and the Rule 462(b)
Registration Statement, if any, in each case including all exhibits
thereto and including (i) the information contained in the
Prospectus (as defined below) filed with the Commission pursuant to
Rule 424(b) under the Securities Act and deemed by virtue of
Rules 430A under the Securities Act to be part of the Initial
Registration Statement at the time it became effective and
(ii) the documents incorporated by reference in the Rule
462(b) Registration Statement at the time the Rule 462(b)
Registration Statement became effective, are hereinafter
collectively called the “Registration Statements.” The
final prospectus, in the form filed pursuant to and within the time
limits described in Rule 424(b) under the Securities Act, is
hereinafter called the “Prospectus.”
(b) As of
the Applicable Time (as defined below) and as of the Closing Date
or the Option Closing Date, as the case may be, neither
(i) the General Use Free Writing Prospectus(es) (as defined
below) issued at or prior to the Applicable Time, the Pricing
Prospectus as defined below, and the information included on
Schedule [ ] hereto, all considered together (collectively, the
“General Disclosure Package”), nor (ii) any
individual Limited Use Free Writing Prospectus (as defined below),
when considered together with the General Disclosure Package,
included or will include any untrue statement of a material fact or
omitted or will 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; provided,
however , that the Company makes no representations or
warranties as to information contained in or omitted from any
Issuer Free Writing Prospectus, in reliance upon, and in conformity
with, written information furnished to the Company through the
Representatives by or on behalf of any Underwriter specifically for
inclusion therein, which information the parties hereto agree is
limited to the Underwriter’s Information (as defined in
Section 18. As used in this paragraph (b) and elsewhere
in this Agreement:
“Applicable
Time” means [___] [A/P].M., New York time, on the date of
this Agreement or such other time as agreed to by the Company and
the Representatives.
“Pricing
Prospectus” means the Preliminary Prospectus relating the
Stock that is included in the Registration Statement immediately
prior to that time, including any document incorporated by
reference therein.
“Issuer Free
Writing Prospectus” means any “issuer free writing
prospectus,” as defined in Rule 433 under the Securities
Act relating to the Stock in the form filed or required to be filed
with the Commission or, if not required to be filed, in the form
retained in the Company’s records pursuant to Rule 433(g)
under the Securities Act.
“General Use
Free Writing Prospectus” means any Issuer Free Writing
Prospectus that is identified on Schedule B to this
Agreement.
“Limited Use
Free Writing Prospectuses” means any Issuer Free Writing
Prospectus that is not a General Use Free Writing
Prospectus.
(c) No
order preventing or suspending the use of any Preliminary
Prospectus, any Issuer Free Writing Prospectus or the Prospectus
relating to the proposed offering of the Stock has been issued by
the Commission, and no proceeding for that purpose or pursuant to
Section 8A of the Securities Act has been instituted or
threatened by the Commission, and each Preliminary Prospectus, at
the time of filing thereof, conformed in all material respects to
the requirements of the Securities Act and the Rules and
Regulations, and did 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 were made, not misleading;
provided, however , that the Company makes no
representations or warranties as to information contained in or
omitted from any Preliminary Prospectus, in reliance upon, and in
conformity with, written information furnished to the Company
through the Representatives by or on
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behalf of any
Underwriter specifically for inclusion therein, which information
the parties hereto agree is limited to the Underwriter’s
Information (as defined in Section 18).
(d) At the
respective times the Registration Statements and any amendments
thereto became or become effective, at the date of this Agreement
and at each Closing Date, each Registration Statement and any
amendments thereto conformed and will conform in all material
respects to the requirements of the Securities Act and the Rules
and Regulations and did not and will not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading; and the Prospectus and any amendments or
supplements thereto, at time the Prospectus or any amendment or
supplement thereto was issued and at each Closing Date, conformed
and will conform in all material respects to the requirements of
the Securities Act and the Rules and Regulations and did not and
will not contain an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made,
not misleading; provided , however , that the
foregoing representations and warranties in this paragraph
(d) shall not apply to information contained in or omitted
from the Registration Statements or the Prospectus, or any
amendment or supplement thereto, in reliance upon, and in
conformity with, written information furnished to the Company
through the Representatives by or on behalf of any Underwriter
specifically for inclusion therein, which information the parties
hereto agree is limited to the Underwriter’s Information (as
defined in Section 17).
(e) Each
Issuer Free Writing Prospectus, as of its issue date and at all
subsequent times through the completion of the public offer and
sale of the Stock or until any earlier date that the Company
notified or notifies the Representatives as described in
Section 4(e), did not, does not and will not include any
information that conflicted, conflicts or will conflict with the
information contained in the Registration Statement, Pricing
Prospectus or the Prospectus, including any document incorporated
by reference therein that has not been superseded or modified, or
included or would include an untrue statement of a material fact or
omitted or would omit to state a material fact required to be
stated therein or necessary in order to make the statements
therein, in the light of the circumstances prevailing at the
subsequent time, not misleading. The foregoing sentence does not
apply to statements in or omissions from any Issuer Free Writing
Prospectus in reliance upon, and in conformity with, written
information furnished to the Company through the Representatives by
or on behalf of any Underwriter specifically for inclusion therein,
which information the parties hereto agree is limited to the
Underwriter’s Information (as defined in
Section 17).
(f) The
Company has not, directly or indirectly, distributed and will not
distribute any offering material in connection with the offering
and sale of the Stock other than any Preliminary Prospectus, the
Prospectus and other materials, if any, permitted under the
Securities Act and consistent with Section 4(b) below. The Company
will file with the Commission all Issuer Free Writing Prospectuses
in the time and manner required under Rules 163(b)92) and 433(d)
under the Securities Act.
(g) The
Company does not have any subsidiaries, as defined in
Section 16, other than its subsidiary in Frankfurt, Germany
(the “Company Subsidiary”). The Company does not own or
control, directly or indirectly, any interest in any corporation,
partnership, limited liability partnership, limited liability
corporation, association or other entity. The Company and the
Company Subsidiary have been duly organized and are validly
existing as corporations or other legal entities in good standing
(or the foreign equivalent thereof) under the laws of their
respective jurisdictions of organization. The Company and the
Company Subsidiary are duly qualified to do business and are in
good standing as foreign corporations or other legal entities in
each jurisdiction in which their respective ownership or lease of
property or the conduct of their respective businesses requires
such qualification and have all power and authority (corporate or
other) necessary to own or hold their respective properties and to
conduct the businesses in which they are engaged, except where the
failure to so qualify or have such power or authority
(i) would not have, singularly or in the aggregate, a material
adverse effect on the condition (financial or otherwise), results
of operations, assets, business or prospects of the Company and the
Company Subsidiary taken as a whole, or (ii) impair in any
material respect the ability of the Company to perform its
obligations under this Agreement or to consummate any transactions
contemplated by the Agreement, the General Disclosure Package or
the Prospectus (any such effect as described in clauses (i) or
(ii), a “Material Adverse Effect”).
(h) This
Agreement has been duly authorized executed and delivered by the
Company.
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(i) The
Stock to be issued and sold by the Company to the Underwriters
hereunder has been duly and validly authorized and, when issued and
delivered against payment therefor as provided herein, will be duly
and validly issued, fully paid and nonassessable and free of any
preemptive or similar rights and will conform to the description
thereof contained in the General Disclosure Package and the
Prospectus.
(j) The
Company has an authorized capitalization as set forth in the
Pricing Prospectus, and all of the issued shares of capital stock
of the Company have been duly and validly authorized and issued,
are fully paid and non-assessable, have been issued in compliance
with federal and state securities laws, and conform to the
description thereof contained in the General Disclosure Package and
the Prospectus. As of [___], there were [___] shares of Common
Stock issued and outstanding and [___] shares of preferred stock,
par value $0.001 (“Preferred Stock”) of the Company
issued and outstanding and [___] shares of Common Stock were
issuable upon the exercise of all options, warrants and convertible
securities outstanding as of such date. Since such date, the
Company has not issued any securities other than Common Stock of
the Company issued pursuant to the exercise of stock options
previously outstanding under the Company’s stock option plans
or the issuance of restricted Common Stock pursuant to employee
stock purchase plans. None of the outstanding shares of Common
Stock was issued in violation of any preemptive rights, rights of
first refusal or other similar rights to subscribe for or purchase
securities of the Company. There are no authorized or outstanding
shares of capital stock, 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 the Company Subsidiary
other than those described above or accurately described in the
General Disclosure Package. The description of the Company’s
stock option, stock bonus and other stock plans or arrangements,
and the options or other rights granted thereunder, as described in
the General Disclosure Package and the Prospectus, accurately and
fairly present the information required to be shown with respect to
such plans, arrangements, options and rights.
(k) All
the outstanding shares of capital stock of the Company Subsidiary
have been duly authorized and validly issued, are fully paid and
nonassessable and, except to the extent set forth in the General
Disclosure Package or the Prospectus, are owned by the Company
directly or indirectly through one or more wholly-owned
subsidiaries, free and clear of any claim, lien, encumbrance,
security interest, restriction upon voting or transfer or any other
claim of any third party.
(l) The
execution, delivery and performance of this Agreement by the
Company, the issue and sale of the Stock by the Company and the
consummation of the transactions contemplated hereby will not (with
or without notice or lapse of time or both) conflict with or result
in a breach or violation of any of the terms or provisions of,
constitute a default under, give rise to any right of termination
or other right or the cancellation or acceleration of any right or
obligation or loss of a benefit under, or give rise to the creation
or imposition of any lien, encumbrance, security interest, claim or
charge upon any property or assets of the Company or the
Company’s Subsidary pursuant to, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to
which the Company or the Company Subsidiary is a party or by which
the Company or the Company Subsidiary is bound or to which any of
the property or assets of the Company or the Company Subsidiary is
subject, nor will such actions result in any violation of the
provisions of the charter or by-laws (or analogous governing
instruments, as applicable) of the Company or the Company
Subsidiary or any law, statute, rule, regulation, judgment, order
or decree of any court or governmental agency or body, domestic or
foreign, having jurisdiction over the Company or the Company
Subsidiary or any of their properties or assets.
(m) Except
for the registration of the Stock under the Securities Act and such
consents, approvals, authorizations, registrations or
qualifications as may be required under the Exchange Act and
applicable state securities laws, the National Association of
Securities Dealers, Inc. and the Nasdaq National Market in
connection with the purchase and distribution of the Stock by the
Underwriters, no consent, approval, authorization or order of, or
filing. qualification or registration with, any court or
governmental agency or body, foreign or domestic, which has not
been made, obtained or taken and is not in full force and effect,
is required for the execution, delivery and performance of this
Agreement by the Company, the offer or sale of the Stock or the
consummation of the transactions contemplated hereby.
5
(n) Ernst
& Young, LLP, who have certified certain financial statements
and related schedules included in the Registration Statements, the
General Disclosure Package and the Prospectus, and have audited the
Company’s internal control over financial reporting and
management’s assessment thereof, is independent registered
public accounting firm as required by the Securities Act and the
Rules and Regulations and the Public Company Accounting Oversight
Board (United States) (the “PCAOB”).
(o) The
financial statements, together with the related notes and
schedules, included in the General Disclosure Package, the
Prospectus and in each Registration Statement fairly present the
financial position and the results of operations and changes in
financial position of the Company and its consolidated subsidiaries
at the respective dates or for the respective periods therein
specified. Such statements and related notes and schedules have
been prepared in accordance with the generally accepted accounting
principles in the United States (“GAAP”) applied on a
consistent basis throughout the periods involved except as may be
set forth in the related notes included in the General Disclosure
Package. The financial statements, together with the related notes
and schedules, included or incorporated by reference in the General
Disclosure Package and the Prospectus comply in all material
respects with the Securities Act and the Rules and Regulations. No
other financial statements or supporting schedules or exhibits are
required by the Securities Act or the Rules and Regulations to be
described or included in the Registration Statements, the General
Disclosure Package or the Prospectus.
(p) Neither the Company nor the Company
Subsidiary has sustained, since the date of the latest audited
financial statements included in the General Disclosure Package,
any material 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, otherwise than as set forth or
contemplated in the General Disclosure Package; and, since such
date, there has not been any change in the capital stock or
long-term debt of the Company or the Company Subsidiary, or any
material adverse changes, or any development involving a
prospective material adverse change, in or affecting the business,
assets, general affairs, management, financial position, prospects,
stockholders’ equity or results of operations of the Company
and the Company Subsidiary taken as a whole, otherwise than as set
forth or contemplated in the General Disclosure Package.
(q) Except
as set forth in the General Disclosure Package, there is no legal
or governmental proceeding pending to which the Company or the
Company Subsidiary is a party or of which any property or assets of
the Company or the Company Subsidiary is the subject which is
required to be described in the Registration Statements, the
General Disclosure Package or the Prospectus and is not described
therein, or which, singularly or in the aggregate, if determined
adversely to the Company or the Company Subsidiary, would have a
Material Adverse Effect; and to the best of the Company’s
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others.
(r) Neither the Company nor the Company
Subsidiary (i) is in violation of its charter or by-laws (or
analogous governing instrument, as applicable), (ii) is in
default in any respect, and no event has occurred which, with
notice or lapse of time or both, would constitute such a default,
in the due performance or observance of any term, covenant or
condition contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a
party or by which it is bound or to which any of its property or
assets is subject or (iii) is in violation in any respect of
any law, ordinance, governmental rule, regulation or court order,
decree or judgment to which it or its property or assets may be
subject except, in the case of clauses (ii) and (iii) of
this paragraph (r), for any violations or defaults which,
singularly or in the aggregate, would not have a Material Adverse
Effect.
(s) The
Company and the Company Subsidiary possess all licenses,
certificates, authorizations and permits issued by, and have made
all declarations and filings with, the appropriate local, state,
federal or foreign regulatory agencies or bodies which are
necessary or desirable for the ownership of their respective
properties or the conduct of their respective businesses as
described in the General Disclosure Package and the Prospectus
(collectively, the “Governmental Permits”) except where
any failures to possess or make the same, singularly or in the
aggregate, would not have a Material Adverse Effect. The Company
and the Company Subsidiary are in compliance with all such
Governmental Permits; all such Governmental Permits are valid and
in full force and effect, except where the validity or failure to
be in full force and effect would not, singularly or in the
aggregate, have a Material Adverse Effect. All such
Governmental
6
Permits are
free and clear of any restriction or condition that are in addition
to, or materially different from those normally applicable to
similar licenses, certificates, authorizations and permits. Neither
the Company nor the Company Subsidiary has received notification of
any revocation or modification (or proceedings related thereto) of
any such Governmental Permit and has no reason to believe that any
such Governmental Permit will not be renewed.
(t) Neither the Company nor the Company
Subsidiary is or, after giving effect to the offering of the Stock
and the application of the proceeds thereof as described in the
General Disclosure Package and the Prospectus, will become an
“investment company” within the meaning of the
Investment Company Act of 1940, as amended, and the rules and
regulations of the Commission thereunder.
(u) Neither the Company nor any of its
officers, directors or affiliates has taken or will take, directly
or indirectly, any action designed or intended to stabilize or
manipulate the price of any security of the Company, or which
caused or resulted in, or which might in the future reasonably be
expected to cause or result in, stabilization or manipulation of
the price of any security of the Company.
(v) The
Company and the Company Subsidiary solely own, or possess the sole
right to use, all patents, patent applications, patent rights,
collaborative research agreements, trademarks, trademark
registrations, service marks, service mark registrations, trade
names, copyrights, licenses, inventions, software, databases,
formulae, customer lists, know-how, Internet domain names, trade
secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures, and other
intellectual property (collectively, “Intellectual
Property”) necessary to or used in the conduct of its
respective businesses as currently conducted, and as proposed to be
conducted, and as described in the General Disclosure Package and
the Prospectus; the Company and the Company Subsidiary are not
aware of any claim to the contrary or challenge to the
Company’s rights in or to any such Intellectual Property
rights, and the Company and the Company’s Subsidiary are
unaware of any facts which would form a reasonable basis for any
such claim; the expiration of any patents, patent rights, trade
secrets, trademarks, service marks, trade names or copyrights would
not result in a material adverse change that is not otherwise
disclosed in the General Disclosure Package and the Prospectus;
none of the patents owned or licensed by the Company is
unenforceable or invalid, and none of the patent applications owned
or licensed by the Company would be unenforceable or invalid if
issued as patents. The Company and the Company Subsidiary have not
granted or assigned to any other person or entity any right to
manufacture, have manufactured, assemble or sell the current
products and services of the Company or those products and services
described in the General Disclosure Package and Prospectus. The
Intellectual Property licenses described in the General Disclosure
Package and the Prospectus are valid, binding upon, and enforceable
by or against the parties thereto in accordance to its terms. The
Company is not obligated to pay a royalty, grant a license, or
provide other consideration to any third party in connection with
the Company’s and the Company Subsidiary’s Intellectual
Property. The Company has complied in all material respects with,
and is not in breach nor has received any asserted or threatened
claim of breach of, any Intellectual Property license, and the
Company has no knowledge of any breach or anticipated breach by any
other person to any Intellectual Property license. The
Company’s and the Company Subsidiary’s business as now
conducted and as proposed to be conducted does not and will not
infringe or conflict with any patents, trademarks, service marks,
trade names, copyrights, trade secrets, licenses or other
Intellectual Property or franchise right of any person or other
third party, or any discovery, invention, product or process which
is the subject of a patent application filed by any third party,
known to the Company or the Company Subsidiary. Except as described
in the General Disclosure Package, no claim has been made, nor is
there any threatened claim, against the Company or the Company
Subsidiary, and the Company and the Company Subsidiary have not
received any notice of, and have no knowledge of any claim,
alleging the infringement by the Company or the Company Subsidiary
of any patent, trademark, service mark, trade name, copyright,
trade secret, license in or other Intellectual Property right or
franchise right of any person, and the Company and the Company
Subsidiary are unaware of any facts which would form a reasonable
basis for any such claim. The Company and the Company Subsidiary
have taken all reasonable steps to protect, maintain and safeguard
its rights in all Intellectual Property, including the execution of
appropriate nondisclosure and confidentiality agreements. The
consummation of the transactions contemplated by this Agreement
will not result in the loss or impairment of or payment of any
additional amounts with respect to, nor require the consent of any
other person in respect of, the Company’s or the Company
Subsidiary’s right to own, use, or
7
hold for use
any of the Intellectual Property as owned, used or held for use in
the conduct of the business as currently conducted or as proposed
to be conducted.
(w) The
Company and the Company Subsidiary have good and marketable title
in fee simple to, or have valid rights to lease or otherwise use,
all items of real or personal property which are material to the
business of the Company and the Company Subsidiary taken as a
whole, in each case free and clear of all liens, encumbrances,
security interests, claims and defects that do not, singularly or
in the aggregate, materially affect the value of such property and
do not interfere with the use made and proposed to be made of such
property by the Company or the Company Subsidiary; and all of the
leases and subleases material to the business of the Company and
the Company Subsidiary, considered as one enterprise, and under
which the Company or the Company Subsidiary holds properties
described in the General Disclosure Package and the Prospectus, are
in full force and effect, and neither the Company nor the Company
Subsidiary has any notice of any material claim of any sort that
has been asserted by anyone adverse to the rights of the Company or
the Company Subsidiary under any of the leases or subleases
mentioned above, or affecting or questioning the rights of the
Company or the Company Subsidiary to the continued possession of
the leased or subleased premises under any such lease or
sublease.
(x) No
labor disturbance by the employees of the Company or the Company
Subsidiary exists or, to the best of the Company’s knowledge,
is imminent, and the Company is not aware of any existing or
imminent labor disturbance by the employees of any of its or the
Company Subsidiary principal suppliers, manufacturers, customers or
contractors, that could reasonably be expected, singularly or in
the aggregate, to have a Material Adverse Effect. The Company is
not aware that any key employee or significant group of employees
of the Company or the Company Subsidiary plans to terminate
employment with the Company or the Company Subsidiary.
(y) No
“prohibited transaction” (as defined in
Section 406 of the Employee Retirement Income Security Act of
1974, as amended, including the regulations and published
interpretations thereunder (“ERISA”), or
Section 4975 of the Internal Revenue Code of 1986, as amended
from time to time (the “Code”)) or “accumulated
funding deficiency” (as defined in Section 302 of ERISA)
or any of the events set forth in Section 4043(b) of ERISA (other
than events with respect to which the thirty (30)-day notice
requirement under Section 4043 of ERISA has been waived) has
occurred or could reasonably be expected to occur with respect to
any employee benefit plan of the Company or the Company Subsidiary
which could, singularly or in the aggregate, have a Material
Adverse Effect. Each employee benefit plan of the Company or the
Company Subsidiary is in compliance in all material respects with
applicable law, including ERISA and the Code. The Company and the
Company Subsidiary have not incurred and could not reasonably be
expected to incur liability under Title IV of ERISA with respect to
the termination of, or withdrawal from, any pension plan (as
defined in ERISA). Each pension plan for which the Company or the
Company Subsidiary would have any liability that is intended to be
qualified under Section 401(a) of the Code is so qualified, and
nothing has occurred, whether by action or by failure to act, which
could, singularly or in the aggregate, cause the loss of such
qualification.
(z) The
Company and the Company Subsidiary are in compliance with all
foreign, federal, state and local rules, laws and regulations
relating to the use, treatment, storage and disposal of hazardous
or toxic substances or waste and protection of health and safety or
the environment which are applicable to their businesses
(“Environmental Laws”), except where the failure to
comply would not, singularly or in the aggregate, have a Material
Adverse Effect. There has been no storage, generation,
transportation, handling, treatment, disposal, discharge, emission,
or other release of any kind of toxic or other wastes or other
hazardous substances by, due to, or caused by the Company or the
Company Subsidiary (or, to the Company’s knowledge, any other
entity for whose acts or omissions the Company or the Company
Subsidiary is or may otherwise be liable) upon any of the property
now or previously owned or leased by the Company or the Company
Subsidiary, or upon any other property, in violation of any law,
statute, ordinance, rule, regulation, order, judgment, decree or
permit or which would, under any law, statute, ordinance, rule
(including rule of common law), regulation, order, judgment, decree
or permit, give rise to any liability, except for any violation or
liability which would not have, singularly or in the aggregate with
all such violations and liabilities, a Material Adverse Effect; and
there has been no disposal, discharge, emission or other release of
any kind onto such property or into the environment surrounding
such property of any toxic or other wastes or other hazardous
substances with respect to which the Company or the
8
Company
Subsidiary has knowledge, except for any such disposal, discharge,
emission, or other release of any kind which would not have,
singularly or in the aggregate with all such discharges and other
releases, a Material Adverse Effect. In the ordinary course of
business, the Company and the Company Subsidiary conduct periodic
reviews of the effect of Environmental Laws on their business and
assets, in the course of which they identify and evaluate
associated costs and liabilities (including, without limitation,
any capital or operating expenditures required for clean-up,
closure of properties or compliance with Environmental Laws or
Governmental Permits issued thereunder, any related constraints on
operating activities and any potential liabilities to third
parties). On the basis of such reviews, the Company has reasonably
concluded that such associated costs and liabilities would not
have, singularly or in the aggregate, a Material Adverse
Effect
(aa) The
Company and the Company Subsidiary each (i) have timely filed
all necessary federal, state, local and foreign tax returns, and
all such returns were true, complete and correct, (ii) have
paid all federal, state, local and foreign taxes, assessments,
governmental or other charges due and payable for which it is
liable, including, without limitation, all sales and use taxes and
all taxes which the Company or the Company Subsidiary is obligated
to withhold from amounts owing to employees, creditors and third
parties, and (iii) do not have any tax deficiency or claims
outstanding or assessed or, to the best of its knowledge, proposed
against any of them, except those, in each of the cases described
in clauses (i), (ii) and (iii) of this paragraph (aa),
that would not, singularly or in the aggregate, have a Material
Adverse Effect. The Company and the Company Subsidiary have not
engaged in any transaction which is a corporate tax shelter or
which could be characterized as such by the Internal Revenue
Service or any other taxing authority. The accruals and reserves on
the books and records of the Company and the Company Subsidiary in
respect of tax liabilities for any taxable period not yet finally
determined are adequate to meet any assessments and related
liabilities for any such period, and since December 31, 2005
the Company and the Company Subsidiary have not incurred any
liability for taxes other than in the ordinary course.
(bb) The
Company and the Company Subsidiary carry, or are covered by,
insurance in such amounts and covering such risks as is adequate
for the conduct of their respective businesses and the value of
their respective properties and as is customary for companies
engaged in similar businesses in similar industries.
(cc) The
Company and the Company Subsidiary maintains a system of internal
accounting and other controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance
with management’s general or specific authorizations; (ii)
transactions are recorded as necessary to permit preparation of
financial statements in conformity with GAAP 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. Except
as described in the General Disclosure Package, since the end of
the Company’s most recent audited fiscal year, there as been
(A) no material weakness in the Company’s internal
control over financial reporting (whether or not remediated) and
(B) no change in the Company’s internal control over
financial reporting that has materially affected, or is reasonably
likely to materially affect, the Company’s internal control
over financial reporting.
(dd) The
minute books of the Company and the Company Subsidiary have been
made available to the Underwriters and counsel for the
Underwriters, and such books (i) contain a complete summary of
all meetings and actions of the board of directors (including each
board committee) and shareholders of the Company (or analogous
governing bodies and interest holders, as applicable), and the
Company Subsidiary since the time of its respective incorporation
or organization through the date of the latest meeting and action,
and (ii) accurately in all material respects reflect all
transactions referred to in such minutes.
(ee) There
is no franchise, lease, contract, agreement or document required by
the Securities Act or by the Rules and Regulations to be described
in the General Disclosure Package and in the Prospectus or to be
filed as an exhibit to the Registration Statements which is not
described or filed therein as required; and all descriptions of any
such franchises, leases, contracts, agreements or documents
contained in the Registration Statements are accurate and complete
descriptions of such documents in all material respects. Other than
as described in the General Disclosure Package, no such franchise,
lease, contract or agreement has been suspended or terminated for
convenience or default by the Company or any of the other parties
thereto, and neither the Company nor the Company Subsidiary has
received notice or has any other
9
knowledge of
any such pending or threatened suspension or termination, except
for such pending or threatened suspensions or terminations that
would not reasonably be expected to, singularly or in the
aggregate, have a Material Adverse Effect.
(ff) No
relationship, direct or indirect, exists between or among the
Company on the one hand, and the directors, officers, stockholders
(or analogous interest holders), customers or suppliers of the
Company or any of its affiliates on the other hand, which is
required to be described in the General Disclosure Package and the
Prospectus and which is not so described.
(gg) No
person or entity has the right to require registration of shares of
Common Stock or other securities of the Company or the Company
Subsidiary because of the filing or effectiveness of the
Registration Statements or otherwise, except for persons and
entities who have expressly waived such right in writing or who
have been given timely and proper written notice and have failed to
exercise such right within the time or times required under the
terms and conditions of such right. Except as described in the
General Disclosure Package, there are no persons with registration
rights or similar rights to have any securities registered by the
Company or the Company Subsidiary under the Securities
Act.
(hh) Neither the Company nor the Company
Subsidiary own any “margin securities” as that term is
defined in Regulation U of the Board of Governors of the
Federal Reserve System (the “Federal Reserve Board”),
and none of the proceeds of the sale of the Stock will be used,
directly or indirectly, for the purpose of purchasing or carrying
any margin security, for the purpose of reducing or retiring any
indebtedness which was originally incurred to purchase or carry any
margin security or for any other purpose which might cause any of
the Stock to be considered a “purpose credit” within
the meanings of Regulation T, U or X of the Federal Reserve
Board.
(ii) Neither the Company nor the Company
Subsidiary is a party to any contract, agreement or understanding
with any person that would give rise to a valid claim against the
Company or the Underwriters for a brokerage commission,
finder’s fee or like payment in connection with the offering
and sale of the Stock or any transaction contemplated by this
Agreement, the Registration Statements, the General Disclosure
Package or the Prospectus.
(jj) No
forward-looking statement (within the meaning of Section 27A
of the Securities Act and Section 21E of the Exchange Act)
contained in either the General Disclosure Package or the
Prospectus has been made or reaffirmed without a reasonable basis
or has been disclosed other than in good faith.
(kk) The
Stock has been approved for listing subject to notice of issuance
on the Nasdaq National Market (“Nasdaq NM”) of The
Nasdaq Stock Market (“Nasdaq”). A registration
statement has been filed on Form 8-A pursuant to Section 12 of
the Exchange Act, which registration statement complies in all
material respects wit the Exchange Act.
(ll) The
Company has taken all necessary actions to ensure that, upon and at
all times after the effectiveness of the Registration Statements,
it will be in compliance with all applicable provisions of the
Sarbanes-Oxley Act of 2002 and all rules and regulations
promulgated thereunder or implementing the provisions thereof (the
“Sarbanes-Oxley Act”) that are then in effect and is
actively taking steps to ensure that it will be in compliance with
other applicable provisions of the Sarbanes-Oxley Act not currently
in effect upon and at all times after the effectiveness of such
provisions.
(mm) The
Company has taken all necessary actions to ensure that, upon and at
all times after the Nasdaq NM shall have approved the Stock for
inclusion therein, it will be in compliance with all applicable
corporate governance requirements set forth in the Nasdaq
Marketplace Rules that are then in effect and is actively taking
steps to ensure that it will be in compliance with other applicable
corporate governance requirements set forth in the Nasdaq
Marketplace Rules not currently in effect upon and all times after
the effectiveness of such requirements.
(nn) Neither the Company nor the Company
Subsidiary nor, to the best of the Company’s knowledge, any
employee or agent of the Company or the Company Subsidiary, has
made any contribution or other payment to any official of, or
candidate for, any federal, state, local or foreign office in
violation of any law
10
(including the
Foreign Corrupt Practices Act of 1977, as amended) or of the
character required to be disclosed in the Registration Statements,
the General Disclosure Package or the Prospectus.
(oo) There
are no transactions, arrangements or other relationships between
and/or among the Company, any of its affiliates (as such term is
defined in Rule 405 of the Securities Act) and any
unconsolidated entity, including, but not limited to, any structure
finance, special purpose or limited purpose entity that could
reasonably be expected to materially affect the Company’s
liquidity or the availability of or requirements for its capital
resources required to be described in the General Disclosure
Package and the Prospectus which have not been described as
required.
(pp) There
are no outstanding loans, advances (except normal advances for
business expenses in the ordinary course of business) or guarantees
or indebtedness by the Company or the Company Subsidiary to or for
the benefit of any of the officers or directors of the Company, the
Company Subsidiary or any of their respective family members,
except as disclosed in the Registration Statements, the General
Disclosure Package and the Prospectus.
(qq) The
statistical and market related data included in the Registration
Statement, the General Disclosure Package and the Prospectus are
based on or derived from sources that the Company believes to be
reliable and accurate, and such data agree with the sources from
which they are derived.
(rr) The
operations of the Company and the Company Subsidiary are and have
been conducted at all times in compliance with applicable financial
recordkeeping and reporting requirements of the Currency and
Foreign Transactions Reporting Act of 1970, as amended, applicable
money laundering statutes and applicable rules and regulations
thereunder (collectively, the “Money Laundering Laws”),
and no action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving
the Company or the Company Subsidiary with respect to the Money
Laundering Laws is pending, or to the best knowledge of the
Company, threatened.
(ss) Neither the Company nor the Company
Subsidiary nor, to the knowledge of the Company, any director,
officer, agent, employee or affiliate of the Company or the Company
Subsidiary is currently subject to any U.S. sanctions administered
by the Office of Foreign Assets Control of the U.S. Treasury
Department (“OFAC”); and the Company will not directly
or indirectly use the proceeds of the offering, or lend, contribute
or otherwise make available such proceeds to any subsidiary, joint
venture partner or other person or entity, for the purpose of
financing the activities of any person currently subject to any
U.S. sanctions administered by OFAC.
(tt) The
Registration Statements, the General Disclosure Package, the
Prospectus and the Preliminary Prospectuses comply, and any further
amendments or supplements thereto will comply, with any applicable
laws or regulations of foreign jurisdictions in which they are
distributed in connection with the Directed Share Program. No
authorization, approval, consent, license, order, registration or
qualification of or with any government, governmental
instrumentality, or court, other than such as have been obtained,
is necessary under the securities laws or regulations of any
foreign jurisdiction in which the Directed Shares are offered
outside the United States.
(uu) The
Company has not offered, or caused the Underwriters to offer, any
Firm Stock to any person pursuant to the Directed Share Program
with the specific intent to unlawfully influence (i) a
customer, supplier or business partner of the Company to alter the
customer’s, supplier’s or business partner’s
level or type of business with the Company or (ii) a trade
journalist or publication to write or publish favorable information
about the Company or its products.
(vv) Neither the Company nor any of its
affiliates (within the meaning of NASD Conduct Rule 2720(b)(1)(a))
directly or indirectly controls, is controlled by, or is under
common control with, or is an associated person (within the meaning
of Article I, Section 1(ee) of the By-laws of the NASD)
of, any member firm of the NASD[,other than as described on
Schedule C hereto].
(ww) The
Company has complied with, is not in material violation of, and has
not received any written notices of violation with respect to, any
foreign, federal, state or local statute, law or regulation,
including
11
without
limitation all statutes, rules, or regulations applicable to the
ownership, testing, development, manufacture, packaging,
processing, use, distribution, marketing, labeling, promotion,
sale, offer for sale, storage, import, export or disposal of any
product manufactured or distributed by the Company
(“Applicable Laws”), or any license, certificate,
approval, clearance, authorization, permit, supplement or amendment
required by any Applicable Laws (“Authorizations”). The
Company possesses all required Authorizations and such
Authorizations are in full force and effect. The Company is, and
its products are, in compliance with all Authorizations and
Applicable Laws, including, but not limited to, all laws, statutes,
rules, regulations, or orders administered, issued or enforced by
the Federal Food and Drug Administration (the “FDA”) or
any other federal or foreign governmental authority having
authority over the Company or any of its products
(“Governmental Authority”). The Company has not
received from the FDA or any other Governmental Authority any
notice of adverse findings, regulatory letters, notices of
violations, Warning Letters, criminal proceeding notices under
Section 305 of the Federal Food, Drug, and Cosmetic Act, or
other similar communication from the FDA or other Governmental
Authority alleging or asserting noncompliance with Applicable Laws
or any Authorizations, and there have been no seizures conducted or
threatened by the FDA or other Governmental Authority, and no
recalls, market withdrawals, field notifications, notifications of
misbranding or adulteration, safety alerts or similar actions
relating to the safety or efficacy of the Company’s products
conducted, requested or threatened by the FDA or other Governmental
Authority. The Company has not, either voluntarily or
involuntarily, initiated, conducted, or issued or caused to be
initiated, conducted or issued, any recall, market withdrawal,
safety alert, “dear doctor” letter, or other similar
notice or action relating to the alleged lack of safety or efficacy
of any of the Company’s products or any alleged product
defect or violation, and the Company has no knowledge that the FDA
or other Governmental Authority has initiated, conducted or intends
to initiate any such notice or action. The Company has not received
notice of any claim, action, suit, proceeding, hearing,
enforcement, investigation, arbitration or other similar action
from the FDA or other Governmental Authority alleging that any
product operation or activity is in violation of any Applicable
Laws or Authorizations and has no knowledge that the FDA or any
other such Governmental Authority is considering any such claim,
litigation, arbitration, action, suit, investigation or proceeding.
Each regulatory submission for the Company’s products has
been filed, cleared and maintained in compliance with all
Applicable Laws and Authorizations, including without limitation
applicable federal statutes, rules, regulations or orders
administered or promulgated by the FDA or other Governmental
Authority, and all laboratory and clinical studies, and tests
currently being conducted and that support clearance of its
products are or have been conducted in compliance with all
Applicable Laws and Authorizations. No filing or submission to the
FDA or any other Governmental Authority, contains any material
omission or false information, and the Company has not received any
notices or correspondence from any Governmental Authority
(including, but not limited to, the FDA) requiring suspension of
any studies, tests, or clinical trials conducted or currently being
conducted by or on behalf of the Company. The Company is not aware
of any facts which are reasonably likely to cause (i) the
nonapproval or non-clearance, withdrawal, or recall of any products
sold or intended to be sold by the Company, (ii) a change in
the marketing classification or labeling of any such products,
(iii) a termination or suspension of marketing clearance of
any such products, or clinical trials being conducted by or on
behalf of the Company or (iv) a suspension or revocation of
any of the Company’s Authorizations. The Company has not
received notice (whether complete or pending) of any proceeding
seeking recall, suspension or seizure of any products sold or
proposed to be sold by the Company. The clinical trials and tests
conducted by or on behalf of the Company that are described in the
the Registration Statements, the General Disclosure Package, the
Prospectus and the Preliminary Prospectuses, or the results of
which are referred to in the Registration Statements, the General
Disclosure Package, the Prospectus and the Preliminary
Prospectuses, if any, are the only clinical trials and tests
currently being conducted by or on behalf of the Company, and, to
the best of the Company’s knowledge, such studies and tests
were and, if still pending, are being conducted in accordance with
experimental protocols, procedures and controls pursuant to
accepted professional scientific standards; and the descriptions of
the results of clinical trials and tests contained in the
Registration Statements, the General Disclosure Package, the
Prospectus and the Preliminary Prospectuses are accurate and
complete in all material respects and fairly present the data
derived from such studies and tests. Except as described in the the
Registration Statements, the General Disclosure Package, the
Prospectus and the Preliminary Prospectuses, the Company has no
knowledge of any other clinical trials or tests, the results of
which are inconsistent with or otherwise call into question the
results of the clinical trials and tests described
therein.
12
Any certificate
signed by or on behalf of the Company and delivered to the
Representatives or to counsel for the Underwriters shall be deemed
to be a representation and warranty by the Company to each
Underwriter as to the matters covered thereby.
3. Purchase Sale and Delivery of Offered
Securities . On the basis of the representations,
warranties and agreements herein contained, but subject to the
terms and conditions herein set forth, the Company agrees, to sell
to each Underwriter, and each Underwriter agrees, severally and not
jointly, to purchase from the Company that number of shares of Firm
Stock (rounded up or down, as determined by the Representatives in
their discretion, in order to avoid fractions) obtained by
multiplying [___] shares of Firm Stock by a fraction the numerator
of which is the number of shares of Firm Stock set forth opposite
the name of such Underwriter in Schedule A hereto and the
denominator of which is the total number of shares of Firm
Stock.
The purchase price
per share to be paid by the Underwriters to the Company or the
Stock will be $[___] per share (the “Purchase
Price”).
The Company will
deliver the Firm Stock to the Representatives for the respective
accounts of the several Underwriters, through the facilities of The
Depositary Trust Company or, at the election of the
Representatives, in the form of definitive certificates, in each
such case, issued in such names and in such denominations as the
Representatives may direct by notice in writing to the Company
given at or prior to 12:00 Noon, New York time, on the second
(2 nd
) full business day preceding the
First Closing Date (as defined below)) against payment of the
aggregate Purchase Price therefor by wire transfer in federal (same
day) funds to an account at a bank acceptable to the
Representatives payable to the order of the Company, all at the
offices of Heller Ehrman LLP, 4350 La Jolla Village Drive, 7
th Floor, San Diego, CA 92122-1246. Time shall be
of the essence, and delivery at the time and place specified
pursuant to this Agreement is a further condition of the
obligations of each Underwriter hereunder. The time and date of the
delivery and closing shall be at 10:00 A.M., New York time, on
[___], 2006, in accordance with Rule 15c6-1 of the Exchange
Act. The time and date of such payment and delivery are herein
referred to as the “First Closing Date”. The First
Closing Date and the location of delivery of, and the form of
payment for, the Firm Stock may be varied by agreement between the
Company and the Representatives.
The Company, in
the event the Representatives elect to have the Underwriters take
delivery of definitive certificates instead of delivery from the
Company of the certificates through the facilities of The
Depository Trust Company, shall make certificates for the Firm
Stock available to the Representatives for examination on behalf of
the Underwriters in New York, New York at least one (1) full
business day prior to the First Closing Date.
For the purpose of
covering any over-allotments in connection with the distribution
and sale of the Firm Stock as contemplated by the Prospectus, the
Underwriters may purchase all or less than all of the Optional
Stock. The price per share to be paid for the Optional Stock shall
be the Purchase Price. The Company agrees to sell to the
Underwriters the number of shares of Optional Stock specified in
the written notice delivered by the Representatives to the Company
described below and the Underwriters agree, severally and not
jointly, to purchase such shares of Optional Stock. Such shares of
Optional Stock shall be purchased from the Company for the account
of each Underwriter in the same proportion as the number of shares
of Firm Stock set forth opposite such Underwriter’s name on
Schedule A bears to the total number of shares of Firm Stock
(subject to adjustment by the Representatives to eliminate
fractions). The option granted hereby may be exercised as to all or
any part of the Optional Stock at any time, and from time to time,
not more than thirty (30) days subsequent to the date of this
Agreement. No Optional Stock shall be sold and delivered unless the
Firm Stock previously has been, or simultaneously is, sold and
delivered. The right to purchase the Optional Stock or any portion
thereof may be surrendered and terminated at any time upon notice
by the Representatives to the Company.
The option granted
hereby may be exercised by written notice being given to the
Company by the Representatives setting forth the number of shares
of the Optional Stock to be purchased by the Underwriters and the
date and time for delivery of and payment for the Optional Stock.
Each date and time for delivery of and payment for the Optional
Stock (which may be the First Closing Date, but not earlier) is
herein called the “Option Closing Date” and shall in no
event be earlier than two (2) business days nor later than
five (5) business days after written notice is given. (The
Option Closing Date and the First Closing Date are herein called
the “Closing Dates”.)
The Company will
deliver the Optional Stock to the Representatives for the
respective accounts of the several Underwriters in the case of the
Company, through the facilities of The Depositary Trust Company or,
at the
13
election of the
Representatives, in the form of definitive certificates, in each
such case, issued in such names and in such denominations as the
Representatives may direct by notice in writing to the Company
given at or prior to 12:00 Noon, New York time, on the second
(2 nd
) full business day preceding the
Option Closing Date (as defined below)) against payment of the
aggregate Purchase Price therefor by wire transfer in federal (same
day) funds to, an account at a bank acceptable to the
Representatives payable to the order of the Company, all at the
offices of Heller Ehrman LLP, 4350 La Jolla Village Drive, 7
th Floor, San Diego, CA 92122-1246. Time shall be
of the essence, and delivery at the time and place specified
pursuant to this Agreement is a further condition of the
obligations of each Underwriter hereunder. The Company, in the
event the Representatives elect to have the Underwriters take
delivery of definitive certificates instead of delivery from the
Company of the certificates thr
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