EXHIBIT 1.1
N U V ASIVE , I NC .
6,500,000
Shares
Common
Stock
UNDERWRITING AGREEMENT
dated
,
2006
Banc of America Securities
LLC
Lehman Brothers
Inc.
Thomas Weisel Partners
LLC
William Blair & Company,
L.L.C.
Underwriting
Agreement
,
2006
BANC OF AMERICA SECURITIES
LLC
LEHMAN BROTHERS INC.
THOMAS WEISEL PARTNERS
LLC
WILLIAM BLAIR & COMPANY,
L.L.C.
As Representatives of the several
Underwriters
c/o BANC OF AMERICA SECURITIES
LLC
9 West 57th Street
New York, NY 10019
and
LEHMAN BROTHERS INC.
745 Seventh Avenue
New York, NY 10019
Ladies and Gentlemen:
Introductory
. NuVasive, Inc., a Delaware
corporation (the “Company”), proposes to issue and sell
to the several underwriters named in Schedule A (the
“Underwriters”) an aggregate of 5,704,120 shares of its
Common Stock, par value $0.001 per share (the “Common
Stock”); and the stockholders of the Company named in
Schedule B (collectively, the “Selling
Stockholders”) severally propose to sell to the Underwriters
an aggregate of 795,880 shares of Common Stock. The 5,704,120
shares of Common Stock to be sold by the Company and the 795,880
shares of Common Stock to be sold by the Selling Stockholders are
collectively called the “Firm Common Shares”. In
addition, the Company has granted to the Underwriters an option to
purchase up to an additional 975,000 shares (the “Optional
Common Shares”) of Common Stock, as provided in
Section 2. The Firm Common Shares and, if and to the extent
such option is exercised, the Optional Common Shares are
collectively called the “Common Shares.” Banc of
America Securities LLC (“BAS”), Lehman Brothers Inc.
(“Lehman”), Thomas Weisel Partners LLC and William
Blair & Company, L.L.C. have agreed to act as
representatives of the several Underwriters (in such capacity, the
“Representatives”) in connection with the offering and
sale of the Common Shares.
To the extent there are no
additional Underwriters listed on Schedule A other than you,
the terms Representatives and Underwriters as used herein shall
mean you, as Underwriters. The terms Representatives and
Underwriters shall mean either the singular or plural as the
context requires.
The Company has prepared and filed
with the Securities and Exchange Commission (the
“Commission”) a registration statement on Form S-3
(File No. 333-130354), which contains a form of prospectus to
be used in connection with the public offering and sale of the
Common Shares. Such registration statement, as amended, including
the financial statements, exhibits and schedules thereto, in the
form in which it was declared effective by the Commission under the
Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder (collectively, the “Securities
Act”), including any required information deemed to be a part
thereof at the time of effectiveness pursuant to Rule 430A under
the Securities Act or the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder
(collectively, the “Exchange Act”), is called the
“Registration Statement.” Any registration statement
filed by the Company pursuant to Rule 462(b) under the Securities
Act is called the “Rule 462(b) Registration Statement,”
and from and after the date and time of filing of the Rule 462(b)
Registration Statement the term “Registration
Statement” shall include the Rule 462(b) Registration
Statement. Any preliminary prospectus included in the Registration
Statement or filed with the Commission pursuant to Rule 424(a) of
the rules and regulations of the Commission under the Securities
Act is hereinafter called a “preliminary prospectus.”
The term “Prospectus” shall mean the final prospectus
relating to the Common Shares that is first filed pursuant to Rule
424(b) after the date and time that this Agreement is executed and
delivered by the parties hereto (the “Execution Time”)
or, if no filing pursuant to Rule 424(b) is
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required, shall mean the form of final
prospectus relating to the Common Shares included in the
Registration Statement at the effective date of the Registration
Statement. The term “Statutory Prospectus” shall mean
any preliminary prospectus, as amended or supplemented, relating to
the Common Shares that is included in the Registration Statement
immediately prior to the Initial Sale Time (as defined herein),
including any document incorporated by reference therein. Any
reference herein to any preliminary prospectus or the Prospectus
shall be deemed to refer to and include the documents incorporated
by reference therein pursuant to Item 12 of Form S-3 under the
Securities Act, as of the date of such preliminary prospectus or
Prospectus, as the case may be; any reference to any amendment or
supplement to any preliminary prospectus or the Prospectus shall be
deemed to refer to and include any documents filed after the date
of such preliminary prospectus or Prospectus, as the case may be,
under the Exchange Act, and incorporated by reference in such
preliminary prospectus or Prospectus, as the case may be; and any
reference to any amendment to the Registration Statement shall be
deemed to refer to and include any annual report of the Company
filed pursuant to Section 13(a) or 15(d) of the Exchange Act
after the effective date of the Registration Statement that is
incorporated by reference in the Registration Statement. All
references in this Agreement to (i) the Registration
Statement, the Rule 462(b) Registration Statement, a preliminary
prospectus, the Prospectus, or any amendments or supplements to any
of the foregoing, shall include any copy thereof filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval System (“EDGAR”) and (ii) the Prospectus
shall be deemed to include the “electronic Prospectus”
provided for use in connection with the offering of the Shares as
contemplated by Section 3(A)(n) of this Agreement.
The Company and each of the Selling
Stockholders hereby confirm their respective agreements with the
Underwriters as follows:
SECTION 1. Representations and
Warranties .
A. Representations and Warranties
of the Company. The Company hereby represents, warrants and
covenants to each Underwriter as follows:
(a) Compliance with Registration
Requirements . The Registration Statement and any Rule 462(b)
Registration Statement have been declared effective by the
Commission under the Securities Act. The Company has complied with
all requests of the Commission for additional or supplemental
information. No stop order suspending the effectiveness of the
Registration Statement or any Rule 462(b) Registration Statement is
in effect and no proceedings for such purpose have been instituted
or are pending or, to the best knowledge of the Company, are
threatened by the Commission.
Each preliminary prospectus and the
Prospectus when filed complied in all material respects with the
Securities Act and, if filed by electronic transmission pursuant to
EDGAR (except as may be permitted by Regulation S-T under the
Securities Act), was identical in content to the copy thereof
delivered to the Underwriters for use in connection with the offer
and sale of the Common Shares. Each of the Registration Statement,
any Rule 462(b) Registration Statement and any post-effective
amendment thereto, at the time it became effective and at all times
during the Prospectus Delivery Period (as defined below), complied
and will comply in all material respects with the Securities Act
and did not and will not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading. The
Prospectus (including any Prospectus wrapper), as amended or
supplemented, as of its date and at all times during the Prospectus
Delivery Period, did not and will not contain any untrue statement
of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The
representations and warranties set forth in the two immediately
preceding sentences do not apply to statements in or omissions from
the Registration Statement, any Rule 462(b) Registration Statement,
or any post-effective amendment thereto, or the Prospectus, or any
amendments or supplements thereto, made in reliance upon and in
conformity with information relating to any Underwriter furnished
to the Company in writing by the Representatives expressly for use
therein, it being understood and agreed that the only such
information furnished by the Representatives consists of the
information described as such in Section 8 hereof. There is no
contract or other document required to be described in the
Prospectus or to be filed as an exhibit to the Registration
Statement which has not been described or filed as
required.
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The documents incorporated by
reference in the Prospectus (all of such incorporated documents
being collectively referred to as the “Incorporated
Documents”), when they became effective or were filed with
the Commission, as the case may be, conformed in all material
respects to the requirements of the Securities Act or the Exchange
Act, as applicable, and the rules and regulations of the Commission
thereunder, and none of such documents 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; and any further documents so filed and
incorporated by reference in the Prospectus or any further
amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be,
will conform in all material respects to the requirements of the
Securities Act or the Exchange Act, as applicable, and the rules
and regulations of the Commission thereunder and 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.
(b) Disclosure Package . The
term “Disclosure Package” shall mean (i) the
Statutory Prospectus, if any, (ii) the issuer free writing
prospectuses as defined in Rule 433 of the Securities Act (each, an
“Issuer Free Writing Prospectus”), if any, identified
in Schedule C hereto, (iii) any other “free
writing prospectus” as defined in Rule 405 of the Securities
Act (a “Free Writing Prospectus”) that the parties
hereto shall hereafter expressly agree to treat as part of the
Disclosure Package and (iv) a schedule indicating the number
of Common Shares being sold and the price at which the Common
Shares will be sold to the public. As of
:00 [a/p]m
(Eastern time) on the date of this Agreement (the “Initial
Sale Time”), the Disclosure Package consisted of the
documents identified in Schedule F hereto and did not
contain any untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading. The preceding sentence does not apply to
statements in or omissions from the Disclosure Package based upon
and in conformity with written information furnished to the Company
by any Underwriter through the Representatives specifically for use
therein, it being understood and agreed that the only such
information furnished by or on behalf of any Underwriter consists
of the information described as such in Section 8
hereof.
(c) Company Not Ineligible
Issuer . (i) At the time of filing the Registration
Statement and (ii) as of the date of the execution and
delivery of this Agreement (with such date being used as the
determination date for purposes of this clause (ii)), the Company
was not and is not an Ineligible Issuer (as defined in Rule 405 of
the Securities Act), without taking account of any determination by
the Commission pursuant to Rule 405 of the Securities Act that it
is not necessary that the Company be considered an Ineligible
Issuer.
(d) Issuer Free Writing
Prospectuses . 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 Common Shares or until any earlier
date of which the Company notified or notifies the Representatives
as described in Section 3(A)(d), did not, does not and will
not include any information that conflicted, conflicts or will
conflict with the information contained in the Registration
Statement, including any document incorporated by reference therein
that has not been superseded or modified. The foregoing sentence
does not apply to statements in or omissions from any Issuer Free
Writing Prospectus based upon and in conformity with written
information furnished to the Company by any Underwriter through the
Representatives specifically for use therein, it being understood
and agreed that the only such information furnished by any
Underwriter consists of the information described as such in
Section 8 hereof.
(e) Offering Materials Furnished
to Underwriters . The Company has delivered to each
Representative one complete manually signed copy of the
Registration Statement and of each consent and certificate of
experts filed as a part thereof, and conformed copies of the
Registration Statement (without exhibits) and each preliminary
prospectus and the Prospectus, as amended or supplemented, in such
quantities and at such places as the Representatives have
reasonably requested for each of the Underwriters.
(f) Distribution of Offering
Material By the Company . The Company has not distributed and
will not distribute, prior to the later of the last Subsequent
Closing Date (as defined below) and the completion of
the
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Underwriters’ distribution of the Common
Shares, any offering material in connection with the offering and
sale of the Common Shares other than a preliminary prospectus, the
Prospectus, any Issuer Free Writing Prospectus reviewed and
consented to by the Representatives or the Registration
Statement.
(g) The Underwriting
Agreement . This Agreement has been duly authorized, executed
and delivered by, and is a valid and binding agreement of, the
Company, enforceable in accordance with its terms, except as rights
to indemnification hereunder may be limited by applicable law and
except as the enforcement hereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by
general equitable principles.
(h) Authorization of the Common
Shares . The Common Shares to be purchased by the Underwriters
from the Company have been duly authorized for issuance and sale
pursuant to this Agreement and, when issued and delivered by the
Company pursuant to this Agreement against payment therefor, will
be validly issued, fully paid and nonassessable.
(i) No Applicable Registration or
Other Similar Rights . There are no persons with registration
or other similar rights to have any equity or debt securities
registered for sale under the Registration Statement or included in
the offering contemplated by this Agreement, except for such rights
as have been duly waived.
(j) No Material Adverse
Change . Except as otherwise disclosed in the Disclosure
Package, subsequent to the respective dates as of which information
is given in the Disclosure Package: (i) there has been no
material adverse change, or any development that could reasonably
be expected to result in a material adverse change, in the
condition, financial or otherwise, or in the earnings, business,
operations or prospects, whether or not arising from transactions
in the ordinary course of business, of the Company and its
subsidiaries, considered as one entity (any such change is called a
“Material Adverse Change”); (ii) the Company and
its subsidiaries, considered as one entity, have not incurred any
material liability or obligation, indirect, direct or contingent
not in the ordinary course of business, nor entered into any
material transaction or agreement not in the ordinary course of
business; and (iii) there has been no dividend or distribution
of any kind declared, paid or made by the Company or, except for
dividends paid to the Company or other subsidiaries, any of its
subsidiaries on any class of capital stock or repurchase or
redemption by the Company or any of its subsidiaries of any class
of capital stock.
(k) Independent Accountants .
Ernst & Young LLP, which has expressed its opinion with
respect to the financial statements (which term as used in this
Agreement includes the related notes thereto) and supporting
schedules filed with the Commission as a part of the Registration
Statement and included in the Disclosure Package and the
Prospectus, is, to the knowledge of the Company, an independent
registered public accounting firm as required by the Securities Act
and the Exchange Act and the applicable published rules and
regulations thereunder.
(l) Preparation of the Financial
Statements . The financial statements filed with the Commission
as a part of or incorporated by reference in the Registration
Statement and included or incorporated by reference in the
Disclosure Package and the Prospectus present fairly, in all
material respects, the consolidated financial position of the
Company and its subsidiaries as of and at the dates indicated and
the results of their operations and cash flows for the periods
specified. The supporting schedules included or incorporated by
reference in the Registration Statement present fairly, in all
material respects, the information required to be stated therein.
Such financial statements and supporting schedules have been
prepared in conformity with generally accepted accounting
principles as applied in the United States applied on a consistent
basis throughout the periods involved, except as may be expressly
stated in the related notes thereto. No other financial statements
or supporting schedules are required to be included or incorporated
by reference in the Registration Statement. The financial data set
forth in each of the Statutory Prospectus and the Prospectus under
the captions “Prospectus Summary—Summary Consolidated
Financial Data” and “Capitalization” fairly
present the information set forth therein on a basis consistent
with that of the audited financial statements contained in the
Registration Statement.
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(m) Incorporation and Good
Standing of the Company and its Subsidiaries . Each of the
Company and its subsidiaries has been duly incorporated and is
validly existing as a corporation in good standing under the laws
of the jurisdiction of its incorporation and has corporate power
and authority to own, lease and operate its properties and to
conduct its business as described in the Disclosure Package and, in
the case of the Company, to enter into and perform its obligations
under this Agreement. Each of the Company and each subsidiary of
the Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except for such
jurisdictions where the failure to so qualify or to be in good
standing would not, individually or in the aggregate, result in a
Material Adverse Change. All of the issued and outstanding capital
stock of each subsidiary has been duly authorized and validly
issued, is fully paid and nonassessable and is owned by the
Company, directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance or claim.
Other than NuVasive UK Limited, a United Kingdom limited company,
the Company does not own or control, directly or indirectly, any
corporation, association or other entity other than the
subsidiaries listed in Exhibit 21.1 to the Company’s Annual
Report on Form 10-K for the fiscal year ended December 31,
2004.
(n) Capitalization and Other
Capital Stock Matters . The authorized, issued and outstanding
capital stock of the Company is as set forth in each of the
Disclosure Package and the Prospectus under the caption
“Capitalization” (other than for subsequent issuances,
if any, pursuant to stock option or employee benefit plans
described in the Disclosure Package and the Prospectus or upon
exercise of outstanding options or warrants described in the
Disclosure Package and the Prospectus). The Common Stock (including
the Common Shares) conforms in all material respects to the
description thereof set forth or incorporated by reference in each
of the Disclosure Package and the Prospectus. All of the issued and
outstanding shares of Common Stock (including the shares of Common
Stock owned by the Selling Stockholders) have been duly authorized
and validly issued, are fully paid and nonassessable and have been
issued in compliance with federal and state securities laws. None
of the outstanding shares of Common Stock were issued in violation
of any preemptive rights, rights of first refusal or other similar
rights to subscribe for or purchase securities of the Company.
There are no authorized or outstanding options, warrants,
preemptive rights, rights of first refusal or other rights to
purchase, or equity or debt securities convertible into or
exchangeable or exercisable for, any capital stock of the Company
or any of its subsidiaries other than those accurately described in
the 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, set forth or
incorporated by reference in each of the Disclosure Package and the
Prospectus accurately and fairly presents, in all material
respects, the information required to be shown with respect to such
plans, arrangements, options and rights.
(o) Quotation . The Common
Shares have been approved for quotation on the Nasdaq National
Market, subject only to official notice of issuance.
(p) Non-Contravention of Existing
Instruments; No Further Authorizations or Approvals Required .
Neither the Company nor any of its subsidiaries is in violation of
its charter or by-laws or is in default (or, with the giving of
notice or lapse of time, would be in default)
(“Default”) under any indenture, mortgage, loan or
credit agreement, note, contract, franchise, lease or other
instrument to which the Company or any of its subsidiaries is a
party or by which it or any of them may be bound, or to which any
of the property or assets of the Company or any of its subsidiaries
is subject (each, an “Existing Instrument”), except for
such Defaults as would not, individually or in the aggregate,
result in a Material Adverse Change. The Company’s execution,
delivery and performance of this Agreement and consummation of the
transactions contemplated hereby, by the Disclosure Package and by
the Prospectus (i) have been duly authorized by all necessary
corporate action and will not result in any violation of the
provisions of the charter or by-laws of the Company or any
subsidiary, (ii) will not conflict with or constitute a breach
of, or Default or a Debt Repayment Triggering Event (as defined
below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or
any of its subsidiaries pursuant to, or require the consent of any
other party to, any Existing Instrument, except for such conflicts,
breaches, Defaults, liens, charges or encumbrances as would
not,
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individually or in the aggregate, result in a
Material Adverse Change and (iii) will not result in any
violation of any law, administrative regulation or administrative
or court decree applicable to the Company or any subsidiary. No
consent, approval, authorization or other order of, or registration
or filing with, any court or other governmental or regulatory
authority or agency is required for the Company’s execution,
delivery and performance of this Agreement and consummation of the
transactions contemplated hereby, by the Disclosure Package and by
the Prospectus, except such as have been obtained or made by the
Company and are in full force and effect under the Securities Act,
applicable state securities or blue sky laws and from the NASD. As
used herein, a “Debt Repayment Triggering Event” means
any event or condition which gives, or with the giving of notice or
lapse of time would give, the holder of any note, debenture or
other evidence of indebtedness (or any person acting on such
holder’s behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such indebtedness by
the Company or any of its subsidiaries.
(q) No Material Actions or
Proceedings . Except as otherwise disclosed in the Prospectus
and the Incorporated Documents, there are no legal or governmental
actions, suits or proceedings pending or, to the best of the
Company’s knowledge, threatened (i) against or affecting
the Company or any of its subsidiaries, (ii) which has as the
subject thereof any officer or director of, or property owned or
leased by, the Company or any of its subsidiaries or
(iii) relating to environmental or discrimination matters,
where in any such case (A) there is a reasonable possibility
that such action, suit or proceeding might be determined adversely
to the Company or such subsidiary and (B) any such action,
suit or proceeding, if so determined adversely, would reasonably be
expected to result in a Material Adverse Change or adversely affect
the consummation of the transactions contemplated by this
Agreement. No material labor dispute with the employees of the
Company or any of its subsidiaries exists or, to the best of the
Company’s knowledge, is threatened or imminent.
(r) Intellectual Property
Rights . The Company and its subsidiaries own or possess
sufficient trademarks, trade names, patent rights, copyrights,
domain names, licenses, approvals, trade secrets and other similar
rights (collectively, “Intellectual Property Rights”)
reasonably necessary to conduct their businesses as now conducted;
and the expected expiration of any of such Intellectual Property
Rights would not result in a Material Adverse Change. Neither the
Company nor any of its subsidiaries has received any notice of
infringement or conflict with asserted Intellectual Property Rights
of others, which infringement or conflict, if the subject of an
unfavorable decision, would result in a Material Adverse Change.
The Company is not a party to or bound by any options, licenses or
agreements with respect to the Intellectual Property Rights of any
other person or entity that are required to be set forth in the
Statutory Prospectus, the Prospectus or any Incorporated Document
and are not described in all material respects. 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, to the Company’s knowledge, any of
its officers, directors or employees or otherwise in violation of
the rights of any persons.
(s) All Necessary Permits,
etc . The Company and each of its subsidiaries possess such
valid and current certificates, authorizations or permits issued by
the appropriate state, federal or foreign regulatory agencies or
bodies necessary to conduct their respective businesses, except
where the failure to have such certificates, authorizations or
permits would not result in a Material Adverse Change, and neither
the Company nor any subsidiary has received any notice of
proceedings relating to the revocation or modification of, or
non-compliance with, any such certificate, authorization or permit
which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, could result in a Material Adverse
Change.
(t) Title to Properties . The
Company and each of its subsidiaries has good and marketable title
to all the properties and assets reflected as owned in the
financial statements referred to in Section 1(A)(l) above (or
elsewhere in the Prospectus), in each case free and clear of any
security interests, mortgages, liens, encumbrances, equities,
claims and other defects, except such as do not materially and
adversely affect the value of such property and do not materially
interfere with the use made or proposed to be made of such property
by the Company or such subsidiary. The real property, improvements,
equipment and personal property held under lease by the Company or
any subsidiary are held under valid and enforceable leases, with
such exceptions as are not material and do not materially interfere
with the use made or proposed to be made of such real property,
improvements, equipment or personal property by the Company or such
subsidiary.
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(u) Tax Law Compliance . The
Company and its subsidiaries have filed all necessary federal,
state and foreign income and franchise tax returns and have paid
all taxes required to be paid by any of them and, if due and
payable, any related or similar assessment, fine or penalty levied
against any of them. The Company has made adequate charges,
accruals and reserves in the applicable financial statements
referred to in Section 1(A)(l) above in respect of all
federal, state and foreign income and franchise taxes for all
periods as to which the tax liability of the Company or any of its
subsidiaries has not been finally determined.
(v) Company Not an
“Investment Company . ” The Company has been
advised of the rules and requirements under the Investment Company
Act of 1940, as amended (the “Investment Company Act”).
The Company is not, and after receipt of payment for the Common
Shares will not be, an “investment company” within the
meaning of the Investment Company Act and will conduct its business
in a manner so that it will not become subject to the Investment
Company Act.
(w) Insurance . Each of the
Company and its subsidiaries are insured by recognized, financially
sound and reputable institutions with policies in such amounts and
with such deductibles and covering such risks as are generally
deemed adequate and customary for their businesses including, but
not limited to, policies covering real and personal property owned
or leased by the Company and its subsidiaries against theft,
damage, destruction, acts of vandalism and earthquakes. The Company
has no reason to believe that it or any subsidiary will not be able
(i) to renew its existing insurance coverage as and when such
policies expire or (ii) to obtain comparable coverage from
similar institutions as may be necessary or appropriate to conduct
its business as now conducted and at a cost that would not result
in a Material Adverse Change. Neither of the Company nor any
subsidiary has been denied any insurance coverage which it has
sought or for which it has applied.
(x) No Price Stabilization or
Manipulation . The Company has not taken and will not take,
directly or indirectly, any action designed to or that might be
reasonably expected to cause or result in stabilization or
manipulation of the price of the Common Stock to facilitate the
sale or resale of the Common Shares. The Company acknowledges that
the Underwriters may engage in passive market making transactions
in the Common Shares on the Nasdaq National Market in accordance
with Regulation M under the Exchange Act.
(y) Related Party
Transactions . There are no business relationships or
related-party transactions involving the Company or any subsidiary
or any other person required to be described in the Statutory
Prospectus, the Prospectus or any Incorporated Document that have
not been described as required.
(z) Disclosure Controls and
Procedures . The Company has established and maintains
disclosure controls and procedures (as such term is defined in Rule
13a-15(e) under the Exchange Act), which (i) are designed to
ensure that material information relating to the Company, including
its consolidated subsidiaries, is made known to the Company’s
principal executive officer and its principal financial officer by
others within those entities, particularly during the periods in
which the periodic reports required under the Exchange Act are
being prepared, and (ii) are effective in all material
respects to perform the functions for which they were
established.
(aa) No Unlawful Contributions or
Other Payments . Neither the Company nor any of its
subsidiaries nor, to the best of the Company’s knowledge, any
employee or agent of the Company or any subsidiary, has made any
contribution or other payment to any official of, or candidate for,
any federal, state or foreign office in violation of any law or of
the character required to be disclosed in any of the Statutory
Prospectus, the Prospectus or any Incorporated Document.
(bb) Internal Controls and
Procedures . The Company expects that as of the date it files
its annual report on Form 10-K for the year ended December 31,
2005, it will maintain (i) effective internal control over
financial reporting as defined in Rule 13a-15 under the Exchange
Act, and currently maintains (ii) a system of internal
accounting controls sufficient to provide reasonable assurance that
(A) transactions are executed in accordance with
management’s general or specific authorization;
(B) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally
accepted accounting principles as applied in the
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United States and to maintain accountability for
assets; (C) access to assets is permitted only in accordance
with management’s general or specific authorization; and
(D) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
(cc) No Material Weakness in
Internal Controls. Except as disclosed in the Disclosure
Package or in any document incorporated by reference therein, since
the end of the Company’s most recent audited fiscal year,
there has been (i) no material weakness in the Company’s
internal control over financial reporting (whether or not
remediated) and (ii) 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) Compliance with
Environmental Laws . Except as would not, individually or in
the aggregate, result in a Material Adverse Change (i) neither
the Company nor any of its subsidiaries is in violation of any
federal, state, local or foreign law or regulation relating to
pollution or protection of human health or the environment
(including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or wildlife,
including without limitation, laws and regulations relating to
emissions, discharges, releases or threatened releases of
chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum and petroleum products
(collectively, “Materials of Environmental Concern”),
or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of
Materials of Environment Concern (collectively,
“Environmental Laws”), which violation includes, but is
not limited to, noncompliance with any permits or other
governmental authorizations required for the operation of the
business of the Company or its subsidiaries under applicable
Environmental Laws, or noncompliance with the terms and conditions
thereof, nor has the Company or any of its subsidiaries received
any written communication, whether from a governmental authority,
citizens group, employee or otherwise, that alleges that the
Company or any of its subsidiaries is in violation of any
Environmental Law; (ii) there is no claim, action or cause of
action filed with a court or governmental authority, no
investigation with respect to which the Company has received
written notice, and no written notice by any person or entity
alleging potential liability for investigatory costs, cleanup
costs, governmental responses costs, natural resources damages,
property damages, personal injuries, attorneys’ fees or
penalties arising out of, based on or resulting from the presence,
or release into the environment, of any Material of Environmental
Concern at any location owned, leased or operated by the Company or
any of its subsidiaries, now or in the past (collectively,
“Environmental Claims”), pending or, to the best of the
Company’s knowledge, threatened against the Company or any of
its subsidiaries or any person or entity whose liability for any
Environmental Claim the Company or any of its subsidiaries has
retained or assumed either contractually or by operation of law;
and (iii) to the best of the Company’s knowledge, there
are no past or present actions, activities, circumstances,
conditions, events or incidents, including, without limitation, the
release, emission, discharge, presence or disposal of any Material
of Environmental Concern, that reasonably could result in a
violation of any Environmental Law or form the basis of a potential
Environmental Claim against the Company or any of its subsidiaries
or against any person or entity whose liability for any
Environmental Claim the Company or any of its subsidiaries has
retained or assumed either contractually or by operation of
law.
(ee) Costs of Environmental
Compliance . The Company has reasonably concluded that the
costs and liabilities associated with the Company’s
compliance with Environmental Laws (including, without limitation,
any capital or operating expenditures required for clean-up,
closure of properties or compliance with Environmental Laws or any
permit, license or approval, any related constraints on operating
activities and any potential liabilities to third parties) would
not, individually or in the aggregate, result in a Material Adverse
Change.
(ff) ERISA Compliance . The
Company and its subsidiaries and any “employee benefit
plan” (as defined under the Employee Retirement Income
Security Act of 1974, as amended, and the regulations and published
interpretations thereunder (collectively, “ERISA”))
established or maintained by the Company, its subsidiaries or their
“ERISA Affiliates” (as defined below) are in compliance
in all material respects with ERISA. “ERISA Affiliate”
means, with respect to the Company or a subsidiary, any member of
any group of organizations described in Sections 414(b),(c),(m) or
(o) of the Internal Revenue Code of 1986, as amended, and
the
8
regulations and published interpretations
thereunder (the “Code”) of which the Company or such
subsidiary is a member. No “reportable event” (as
defined under ERISA) has occurred or is reasonably expected to
occur with respect to any “employee benefit plan”
established or maintained by the Company, its subsidiaries or any
of their ERISA Affiliates. No “employee benefit plan”
established or maintained by the Company, its subsidiaries or any
of their ERISA Affiliates, if such “employee benefit
plan” were terminated, would have any “amount of
unfunded benefit liabilities” (as defined under ERISA).
Neither the Company, its subsidiaries nor any of their ERISA
Affiliates has incurred or reasonably expects to incur any
liability under (i) Title IV of ERISA with respect to
termination of, or withdrawal from, any “employee benefit
plan” or (ii) Sections 412, 4971, 4975 or 4980B of the
Code. Each “employee benefit plan” established or
maintained by the Company, its subsidiaries or any of their ERISA
Affiliates that is intended to be qualified under
Section 401(a) of the Code is so qualified and nothing has
occurred, whether by action or failure to act, which would cause
the loss of such qualification.
(gg) Brokers . There is no
broker, finder or other party that is entitled to receive from the
Company any brokerage or finder’s fee or other fee or
commission as a result of any transactions contemplated by this
Agreement.
(hh) No Outstanding Loans or
Other Indebtedness . 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 to
or for the benefit of any of the officers or directors of the
Company or any of the members of any of them, except as disclosed
in the Disclosure Package.
(ii) Sarbanes-Oxley
Compliance. There is and has been no failure on the part of the
Company and, to the best of the Company’s knowledge, any of
the Company’s directors or officers, in their capacities as
such, to comply with any applicable provision of the Sarbanes-Oxley
Act of 2002 and the rules and regulations promulgated in connection
therewith (the “Sarbanes-Oxley Act”), including
Section 402 related to loans and Sections 302 and 906 related
to certifications.
(jj) Compliance with Laws .
The Company has not been advised, and has no reason to believe,
that it and each of its subsidiaries are not conducting business in
compliance with all applicable laws, rules and regulations of the
jurisdictions in which it is conducting business, except where
failure to be so in compliance would not result in a Material
Adverse Change.
Any certificate signed by an officer
of the Company and delivered to any of 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
set forth therein.
The Company acknowledges that the
Underwriters and, for purposes of the opinions to be delivered
pursuant to Section 5 hereof, counsel to the Company and
counsel to the Underwriters, will rely upon the accuracy and
truthfulness of the foregoing representations and hereby consents
to such reliance.
B. Representations and Warranties
of the Selling Stockholders. Each Selling Stockholder
represents, warrants and covenants to each Underwriter as
follows:
(a) The Underwriting
Agreement. This Agreement has been duly authorized, executed
and delivered by or on behalf of, and is a valid and binding
agreement of, such Selling Stockholder, enforceable against such
Selling Stockholder in accordance with its terms, except as rights
to indemnification hereunder may be limited by applicable law and
except as the enforcement hereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by
general equitable principles.
(b) The Custody Agreement and
Power of Attorney. Certificates in negotiable form representing
all of the Common Shares to be sold by such Selling Stockholder
hereunder have been placed in custody under a Custody Agreement, in
the form heretofore furnished to you (the “Custody
Agreement”), duly executed and delivered by
9
such Selling Stockholder to U.S. Stock Transfer
Corporation, as custodian (the “Custodian”), and such
Selling Stockholder has duly executed and delivered a Power of
Attorney, in the form heretofore furnished to you (the “Power
of Attorney”), appointing the persons indicated in Schedule D
hereto, and each of them, as such Selling Stockholder’s
attorneys-in-fact (the “Attorneys-in-Fact”) with
authority to execute and deliver this Agreement on behalf of such
Selling Stockholder, to determine the purchase price to be paid by
the Underwriters to the Selling Stockholders as provided in
Section 2 hereof, to authorize the delivery of the Common
Shares to be sold by such Selling Stockholder hereunder and
otherwise to act on behalf of such Selling Stockholder in
connection with the transactions contemplated by this Agreement and
the Custody Agreement. Each of the (i) Custody Agreement
signed by such Selling Stockholder and the Custodian, relating to
the deposit of the Common Shares to be sold by such Selling
Stockholder and (ii) the Power of Attorney of such Selling
Stockholder has been duly authorized, executed and delivered by
such Selling Stockholder.
(c) Obligations of the Selling
Stockholder. The Common Shares represented by the certificates
held in custody for such Selling Stockholder under the Custody
Agreement are subject to the interests of the Underwriters
hereunder; the arrangements made by such Selling Stockholder for
such custody, and the appointment by such Selling Stockholder of
the Attorneys-in-Fact by the Power of Attorney, are irrevocable;
the obligations of the Selling Stockholders hereunder shall not be
terminated by operation of law, whether by the death or incapacity
of any individual Selling Stockholder or, in the case of an estate
or trust, by the death or incapacity of any executor or trustee or
the termination of such estate or trust, or in the case of a
partnership or corporation, by the dissolution of such partnership
or corporation, or by the occurrence of any other event; if any
individual Selling Stockholder or any such executor or trustee
should die or become incapacitated, or if any such estate or trust
should be terminated, or if any such partnership or corporation
should be dissolved, or if any other such event should occur,
before the delivery of the Common Shares hereunder, certificates
representing the Common Shares shall be delivered by or on behalf
of the Selling Stockholders in accordance with the terms and
conditions of this Agreement and of the Custody Agreement; and
actions taken by the Attorneys-in-Fact pursuant to the Power of
Attorney shall be as valid as if such death, incapacity,
termination, dissolution or other event had not occurred,
regardless of whether or not the Custodian, the Attorneys-in-Fact,
or any of them, shall have received notice of such death,
incapacity, termination, dissolution or other event.
(d) Title to Common Shares to be
Sold . Such Selling Stockholder is, on the First Closing Date
(as defined below), the record and beneficial owner of, and has
good and valid title to, the Common Shares to be sold by such
Selling Stockholder free and clear of all liens, encumbrances,
equities or claims and has duly indorsed such Common Shares in
blank, and, assuming that the Underwriters acquire their interest
in the Common Shares they have purchased without notice of any
adverse claim (within the meaning of Section 8-105 of the
Uniform Commercial Code (the “UCC”)), such Underwriters
that have purchased Common Shares delivered on the date hereof to
The Depository Trust Company (“DTC”) by making payment
therefor, as provided herein, and that have had such Common Shares
credited to the securities account or accounts of such Underwriters
maintained with DTC will have acquired a security entitlement
(within the meaning of Section 8-102(a)(17) of the UCC) to
such Common Shares purchased by such Underwriters, and no action
based on an adverse claim, may be asserted against such
Underwriters with respect to such Common Shares.
(e) All Authorizations
Obtained. Such Selling Stockholder has the legal right and
power, and all authorizations and approvals required by law and
under its charter or by-laws, partnership agreement, trust
agreement or other organizational documents to enter into this
Agreement and its Custody Agreement and Power of Attorney, to sell,
transfer and deliver all of the Common Shares which may be sold by
such Selling Stockholder pursuant to this Agreement and to comply
with its other obligations hereunder and thereunder.
(f) Delivery of the Common Shares
to be Sold. Delivery of the Common Shares which are sold by
such Selling Stockholder pursuant to this Agreement will pass good
and valid title to such Common Shares, free and clear of any
security interest, mortgage, pledge, lien, encumbrance or other
claim.
(g) Non-Contravention; No Further
Authorizations or Approvals Required. The execution and
delivery by such Selling Stockholder of, and the performance by
such Selling Stockholder of its obligations under, this
10
Agreement, the Custody Agreement and the Power
of Attorney (i) will not result in any violation of or Default
under, or require the consent (except for such consents that have
been duly obtained) any other party to, the charter or by-laws,
partnership agreement, trust agreement or other organizational
documents of such Selling Stockholder, (ii) will not conflict
with or constitute a breach of, or Default under, any other
agreement or instrument to which such Selling Stockholder is a
party or by which it is bound or under which it is entitled to any
right or benefit, and (iii) will not result in any violation
of any statute, law, regulation, order or decree applicable to such
Selling Stockholder of any court, regulatory body, administrative
agency, governmental body, arbitrator or other authority having
jurisdiction over such Selling Stockholder or its properties. No
consent, approval, authorization or other order of, or registration
or filing with, any court or other governmental authority or
agency, is required for the consummation by such Selling
Stockholder of the transactions contemplated in this Agreement,
except such as have been obtained or made and are in full force and
effect under the Securities Act, applicable state securities or
blue sky laws and from the NASD.
(h) No Registration or Other
Similar Rights. Except as disclosed in the Registration
Statement and the Incorporated Documents, such Selling Stockholder
does not have any registration or other similar rights to have any
equity or debt securities registered for sale by the Company under
the Registration Statement or included in the offering contemplated
by this Agreement.
(i) No Further Consents, etc.
No consent, approval or waiver is required under any instrument or
agreement to which such Selling Stockholder is a party or by which
it is bound or under which it is entitled to any right or benefit,
in connection with the offering, sale or purchase by the
Underwriters of any of the Common Shares which may be sold by such
Selling Stockholder under this Agreement or the consummation by
such Selling Stockholder of any of the other transactions
contemplated hereby, except for such consents, approvals or waivers
that have been duly obtained.
(j) Disclosure Made by Such
Selling Stockholder in the Prospectus. All information
furnished by or on behalf of such Selling Stockholder in writing
expressly for use in the Registration Statement, the Prospectus or
any Free Writing Prospectus or any amendment or supplement thereto
used by the Company or any Underwriter, as the case may be, was, as
of the Initial Sale Time and on the First Closing Date and any
Subsequent Closing Date will be, true, correct and complete in all
material respects, and was not as of the Initial Sale Time, and on
the First Closing Date and any Subsequent Closing Date will not,
contain any untrue statement of a material fact or omit to state
any material fact necessary to make such information not
misleading. In addition, (i) to the extent that any
statements, information or omissions set forth or required to be
set forth in the Registration Statement, the Prospectus or any Free
Writing Prospectus relate to such Selling Stockholder, such Selling
Stockholder hereby makes to each Underwriter, with regard to such
statements, information or omissions, the same representations and
warranties as the Company makes to such Underwriter under
paragraphs (A)(b) and (A)(d) of this Section 1, and
(ii) such Selling Stockholder hereby confirms as accurate the
number of shares of Common Stock set forth opposite such Selling
Stockholder’s name in each of the Statutory Prospectus and
the Prospectus under the caption “Selling Stockholders”
(both prior to and after giving effect to the sale of the Common
Shares).
(k) No Price Stabilization or
Manipulation. Such Selling Stockholder has not taken and will
not take, directly or indirectly, any action designed to or that
might be reasonably expected to cause or result in stabilization or
manipulation of the price of any security of the Company to
facilitate the sale or resale of the Common Shares.
(l) Registration Statement and
Prospectus. As it relates to the information furnished by or on
behalf of such Selling Stockholder in writing expressly for use in
the Registration Statement, each of the Registration Statement and
any post-effective amendment thereto, at the time it became
effective and at the date hereof did not and will not contain any
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading. As it relates to the information
furnished by or on behalf of such Selling Stockholder in writing
expressly for use in the Registration Statement, the Prospectus
(including any Prospectus wrapper), as amended or supplemented, as
of its date, at the date hereof, at the time of any filing pursuant
to Rule 424(b), at the First Closing Date and at any Subsequent
Closing Date, did not and will
11
not contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading. For avoidance of doubt, the
representations and warranties set forth in the two immediately
preceding sentences do not apply to statements in or omissions from
the Registration Statement or any post-effective amendment thereto,
or the Prospectus, or any amendments or supplements thereto, made
in reliance upon and in conformity with information relating to any
Underwriter furnished to the Company in writing by the
Representatives expressly for use therein, it being understood and
agreed that the only such information furnished by the
Representatives consists of the information described as such in
Section 8 hereof.
(m) No Inside Information.
Such Selling Stockholder is not prompted to sell shares of Common
Stock by any information concerning the Company which is not set
forth in the Registration Statement and the Disclosure
Package.
Any certificate signed by or on
behalf of any Selling Stockholder and delivered to the
Representatives or to counsel for the Underwriters shall be deemed
to be a representation and warranty by such Selling Stockholder to
each Underwriter as to the matters covered thereby.
Such Selling Stockholder
acknowledges that the Underwriters and, for purposes of the
opinions to be delivered pursuant to Section 5 hereof, counsel
to the Company and counsel to the Underwriters, will rely upon the
accuracy and truthfulness of the foregoing representations and
hereby consents to such reliance.
SECTION 2. Purchase, Sale and
Delivery of the Common Shares .
(a) The Firm Common Shares .
Upon the terms but subject to the conditions herein set forth,
(i) the Company agrees to issue and sell to the several
Underwriters an aggregate of 5,704,120 Firm Common Shares and
(ii) the Selling Stockholders agree to sell to the several
Underwriters an aggregate of 795,880 Firm Common Shares, each
Selling Stockholder selling the number of Firm Common Shares set
forth opposite such Selling Stockholder’s name on Schedule
B . On the basis of the representations, warranties and
agreements herein contained, and upon the terms but subject to the
conditions herein set forth, the Underwriters agree, severally and
not jointly, to purchase from the Company and the Selling
Stockholders the respective number of Firm Common Shares set forth
opposite their names on Schedule A . The purchase price
per Firm Common Share to be paid by the several Underwriters to the
Company and the Selling Stockholders shall be
$[ ]
per share.
(b) The First Closing Date .
Delivery of the Firm Common Shares to be purchased by the
Underwriters and payment therefor shall be made at the offices of
Clifford Chance US LLP, 31 West 52nd Street, New York, New York
10019 (or such other place as may be agreed to by the Company and
the Representatives) at 9:00 a.m. New York time, on [ fourth
business days after date of agreement] , or such other time
and date not later than 1:30 p.m. New York time, on [ ten
business days after First Closing Date ], as the
Representatives shall designate by notice to the Company (the time
and date of such closing are called the “First Closing
Date”). The Company hereby acknowledges that circumstances
under which the Representatives may provide notice to postpone the
First Closing Date as originally scheduled include, but are in no
way limited to, any determination by the Company or the
Representatives that the Company is legally required to recirculate
to the public copies of an amended or supplemented Prospectus or a
delay as contemplated by the provisions of
Section 10.
(c) The Optional Common Shares;
the Subsequent Closing Date . In addition, on the basis of the
representations, warranties and agreements herein contained, and
upon the terms but subject to the conditions herein set forth, the
Company hereby grants an option to the several Underwriters to
purchase, severally and not jointly, up to an aggregate of 975,000
Optional Common Shares from the Company at the purchase price per
share to be paid by the Underwriters for the Firm Common Shares.
The option granted hereunder may be exercised at any time (but not
more than twice) and from time to time upon notice by the
Representatives to the Company, which notice may be given at any
time within 30 days from the date of this Agreement. Such notice
shall set forth (i) the aggregate number of Optional Common
Shares as to which the Underwriters are exercising
12
the option, (ii) the names and
denominations in which the Optional Common Shares are to be
registered and (iii) the time, date and place at which the
Optional Common Shares will be delivered (which time and date may
be simultaneous with, but not earlier than, the First Closing Date;
and in such case the term “First Closing Date” shall
refer to the time and date of delivery of the Firm Common Shares
and the Optional Common Shares). Each time and date of delivery, if
subsequent to the First Closing Date, is called a “Subsequent
Closing Date” and shall be determined by the Representatives
and shall not be earlier than three nor later than five full
business days after delivery of such notice of exercise. If any
Optional Common Shares are to be purchased, each Underwriter
agrees, severally and not jointly, to purchase the number of
Optional Common Shares (subject to such adjustments to eliminate
fractional shares as the Representatives may determine) that bears
the same proportion to the total number of Optional Common Shares
to be purchased as the number of Firm Common Shares set forth on
Schedule A opposite the name of such Underwriter bears to
the total number of Firm Common Shares. The Representatives may
cancel the option at any time prior to its expiration by giving
written notice of such cancel
