Exhibit 1.1
UNDERWRITING AGREEMENT
CREE, INC.
11,000,000 Shares of Common
Stock
Underwriting Agreement
September 10, 2009
J.P. Morgan Securities
Inc.
As Representative of the
several Underwriters
listed
in Schedule 1
hereto
c/o J.P. Morgan Securities Inc.
383 Madison Avenue
New York, New York 10179
Ladies and Gentlemen:
Cree, Inc., a North Carolina
corporation (the “Company”), proposes to issue and sell
to the several Underwriters listed in Schedule 1 hereto (the
“Underwriters”), for whom you are acting as
representative (the “Representative”), an aggregate of
11,000,000 shares of Common Stock, par value $ 0.00125 per
share, of the Company (the “Underwritten Shares”) and,
at the option of the Underwriters, up to an additional 1,650,000
shares of Common Stock of the Company (the “Option
Shares”). The Underwritten Shares and the Option Shares are
herein referred to as the “Shares”. The shares of
Common Stock of the Company to be outstanding after giving effect
to the sale of the Shares are referred to herein as the
“Stock”. Each share of Stock, including the Shares,
will have attached thereto a right (each a “Right” and
collectively, the “Rights”) to purchase one
one-thousandth ( 1 / 1000 ) of a share of the Company’s
preferred stock (“Preferred Stock”) or to acquire
additional equity interests in the Company (the “Equity
Interests,” and together with the Preferred Stock, the
“Rights Stock”) or an acquiring entity, each upon the
occurrence of specified events. The Rights are to be issued
pursuant to a Rights Agreement, dated as of May 30, 2002,
between the Company and American Stock Transfer & Trust
Company, as Rights Agent (as amended to date, the “Rights
Agreement”). Unless the context specifically provides
otherwise, all references herein to the Underwritten Shares, Option
Shares and Shares refer to the shares of Common Stock and
corresponding Rights.
The Company hereby confirms its
agreement with the several Underwriters concerning the purchase and
sale of the Shares, as follows:
1. Registration Statement .
The Company has prepared and filed with the Securities and Exchange
Commission (the “Commission”) under the Securities Act
of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the “Securities
Act”), a registration statement (File No. 333- 161785),
including a prospectus (the “Basic Prospectus”),
relating to, among other things, the Shares. Such registration
statement, as amended at the time of its effectiveness, including
the information, if any, deemed pursuant to Rule 430A, 430B or 430C
under the Securities Act to be part of the registration statement
at the time of its effectiveness (“Rule 430
Information”), is referred to herein as the
“Registration Statement”; and as used herein, the term
“Preliminary Prospectus” means the Basic Prospectus
together with the preliminary prospectus supplement specifically
relating to the Shares, and the term “Prospectus” means
the Basic Prospectus as supplemented by the prospectus
supplement
specifically relating to the Shares in the form
first used (or made available upon request of purchasers pursuant
to Rule 173 under the Securities Act) in connection with
confirmation of sales of the Shares. Any reference in this
Agreement to the Registration Statement, 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
effective date of the Registration Statement or the date of such
Preliminary Prospectus or the Prospectus, as the case may be, and
any reference to “amend”, “amendment” or
“supplement” with respect to the Registration
Statement, any Preliminary Prospectus or the Prospectus shall be
deemed to refer to and include any documents filed after such date
under the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Commission thereunder (collectively,
the “Exchange Act”) that are deemed to be incorporated
by reference therein. Capitalized terms used but not defined herein
shall have the meanings given to such terms in the Registration
Statement and the Prospectus.
At or prior to the Applicable Time
(as defined below), the Company had prepared the following
information (collectively with the pricing information set forth on
Annex A, the “Pricing Disclosure Package”): a
Preliminary Prospectus dated September 8, 2009 and each
“free-writing prospectus” (as defined pursuant to Rule
405 under the Securities Act) listed on Annex A hereto.
“Applicable Time” means
6:00 P.M., New York City time, on September 10,
2009.
2. Purchase of the Shares by the
Underwriters .
(a) The Company agrees to issue and
sell the Underwritten Shares to the several Underwriters as
provided in this Agreement, and each Underwriter, on the basis of
the representations, warranties and agreements set forth herein and
subject to the conditions set forth herein, agrees, severally and
not jointly, to purchase from the Company the respective number of
Underwritten Shares set forth opposite such Underwriter’s
name in Schedule 1 hereto at a price per share (the “Purchase
Price”) of $34.34625.
In addition, the Company agrees to
issue and sell the Option Shares to the several Underwriters as
provided in this Agreement, and the Underwriters, on the basis of
the representations, warranties and agreements set forth herein and
subject to the conditions set forth herein, shall have the option
to purchase, severally and not jointly, from the Company the Option
Shares at the Purchase Price less an amount per share equal to any
dividends or distributions declared by the Company and payable on
the Underwritten Shares but not payable on the Option
Shares.
If any Option Shares are to be
purchased, the number of Option Shares to be purchased by each
Underwriter shall be the number of Option Shares which bears the
same ratio to the aggregate number of Option Shares being purchased
as the number of Underwritten Shares set forth opposite the name of
such Underwriter in Schedule 1 hereto (or such number increased as
set forth in Section 10 hereof) bears to the aggregate number
of Underwritten Shares being purchased from the Company by the
several Underwriters, subject, however, to such adjustments to
eliminate any fractional Shares as the Representative in its sole
discretion shall make.
The Underwriters may exercise the
option to purchase Option Shares at any time in whole, or from time
to time in part, on or before the thirtieth day following the date
of the Prospectus, by written notice from the Representative to the
Company. Such notice shall set forth the aggregate number of Option
Shares as to which the option is being exercised and the date and
time when the Option Shares are to be delivered and paid for, which
may be the same date and time as the Closing Date (as hereinafter
defined) but shall not be earlier than the Closing Date or later
than the tenth full business day (as hereinafter defined) after the
date of such notice (unless such time and date are postponed in
accordance with the
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provisions of Section 10 hereof). Any such
notice shall be given at least two business days prior to the date
and time of delivery specified therein.
(b) The Company understands that the
Underwriters intend to make a public offering of the Shares as soon
after the effectiveness of this Agreement as in the judgment of the
Representative is advisable, and initially to offer the Shares on
the terms set forth in the Prospectus. The Company acknowledges and
agrees that the Underwriters may offer and sell Shares to or
through any affiliate of an Underwriter.
(c) Payment for the Shares shall be
made by wire transfer in immediately available funds to the account
specified by the Company to the Representative in the case of the
Underwritten Shares, at the offices of Latham & Watkins
LLP, 555 Eleventh Street, NW Suite 1000, Washington, District of
Columbia 20004 at 10:00 A.M., New York City time, on
September 16, 2009, or at such other time or place on the same
or such other date, not later than the fifth business day
thereafter, as the Representative and the Company may agree upon in
writing or, in the case of the Option Shares, on the date and at
the time and place specified by the Representative in the written
notice of the Underwriters’ election to purchase such Option
Shares. The time and date of such payment for the Underwritten
Shares is referred to herein as the “Closing Date”, and
the time and date for such payment for the Option Shares, if other
than the Closing Date, is herein referred to as the
“Additional Closing Date”.
Payment for the Shares to be
purchased on the Closing Date or the Additional Closing Date, as
the case may be, shall be made against delivery to the
Representative for the respective accounts of the several
Underwriters of the Shares to be purchased on such date or the
Additional Closing Date, as the case may be, with any transfer
taxes payable in connection with the sale of such Shares duly paid
by the Company. Delivery of the Shares shall be made through the
facilities of The Depository Trust Company (“DTC”)
unless the Representative shall otherwise instruct. The
certificates for the Shares will be made available for inspection
and packaging by the Representative at the office of DTC or its
designated custodian not later than 1:00 P.M., New York City time,
on the business day prior to the Closing Date or the Additional
Closing Date, as the case may be.
(d) The Company acknowledges and
agrees that the Underwriters are acting solely in the capacity of
an arm’s length contractual counterparty to the Company with
respect to the offering of Shares contemplated hereby (including in
connection with determining the terms of the offering) and not as a
financial advisor or a fiduciary to, or an agent of, the Company or
any other person. Additionally, neither the Representative nor any
other Underwriter is advising the Company or any other person as to
any legal, tax, investment, accounting or regulatory matters in any
jurisdiction. The Company shall consult with its own advisors
concerning such matters and shall be responsible for making its own
independent investigation and appraisal of the transactions
contemplated hereby, and the Underwriters shall have no
responsibility or liability to the Company with respect thereto.
Any review by the Underwriters of the Company, the transactions
contemplated hereby or other matters relating to such transactions
will be performed solely for the benefit of the Underwriters and
shall not be on behalf of the Company.
3. Representations and Warranties
of the Company . The Company represents and warrants to each
Underwriter that:
(a) Preliminary Prospectus.
No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary
Prospectus included in the Pricing Disclosure Package, at the time
of filing thereof, complied in all material respects with the
Securities Act, and no Preliminary Prospectus, at the time of
filing thereof, contained any untrue statement of a material fact
or omitted to state a material fact necessary in
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order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading; provided that the Company makes no
representation and warranty with respect to any statements or
omissions made in reliance upon and in conformity with information
relating to any Underwriter furnished to the Company in writing by
such Underwriter through the Representative expressly for use in
any Preliminary Prospectus, it being understood and agreed that the
only such information furnished by any Underwriter consists of the
information described as such in Section 7(b)
hereof.
(b) Pricing Disclosure
Package . The Pricing Disclosure Package as of the Applicable
Time did not, and as of the Closing Date and as of the Additional
Closing Date, as the case may be, 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;
provided that the Company makes no representation and
warranty with respect to any statements or omissions made in
reliance upon and in conformity with information relating to any
Underwriter furnished to the Company in writing by such Underwriter
through the Representative expressly for use in such Pricing
Disclosure Package, it being understood and agreed that the only
such information furnished by any Underwriter consists of the
information described as such in Section 7(b)
hereof.
(c) Issuer Free Writing
Prospectus. Other than the Registration Statement, the
Preliminary Prospectus and the Prospectus, the Company (including
its agents and representatives, other than the Underwriters in
their capacity as such) has not prepared, used, authorized,
approved or referred to and will not prepare, use, authorize,
approve or refer to any “written communication” (as
defined in Rule 405 under the Securities Act) that constitutes an
offer to sell or solicitation of an offer to buy the Shares (each
such communication by the Company or its agents and representatives
(other than a communication referred to in clause (i) below)
an “Issuer Free Writing Prospectus”) other than
(i) any document not constituting a prospectus pursuant to
Section 2(a)(10)(a) of the Securities Act or Rule 134 under
the Securities Act or (ii) the documents listed on Annex A
hereto, each electronic road show and any other written
communications approved in writing in advance by the
Representative. Each such Issuer Free Writing Prospectus complied
in all material respects with the Securities Act, has been or will
be (within the time period specified in Rule 433) filed in
accordance with the Securities Act (to the extent required thereby)
and, when taken together with the Preliminary Prospectus filed
prior to the first use of such Issuer Free Writing Prospectus, did
not, and as of the Closing Date and as of the Additional Closing
Date, as the case may be, 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; provided that
the Company makes no representation and warranty with respect to
any statements or omissions made in each such Issuer Free Writing
Prospectus or Preliminary Prospectus in reliance upon and in
conformity with information relating to any Underwriter furnished
to the Company in writing by such Underwriter through the
Representative expressly for use in such Issuer Free Writing
Prospectus or Preliminary Prospectus, it being understood and
agreed that the only such information furnished by any Underwriter
consists of the information described as such in Section 7(b)
hereof.
(d) Registration Statement and
Prospectus. The Registration Statement is an “automatic
shelf registration statement” as defined under Rule 405 of
the Securities Act that has been filed with the Commission not
earlier than three years prior to the date hereof; and no notice of
objection of the Commission to the use of such registration
statement or any post-effective amendment thereto pursuant to Rule
401(g)(2) under the Securities Act has been received by the
Company. No order suspending the effectiveness of the Registration
Statement has been issued
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by the Commission, and no proceeding
for that purpose or pursuant to Section 8A of the Securities
Act against the Company or related to the offering of the Shares
has been initiated or threatened by the Commission; as of the
applicable effective date of the Registration Statement and any
post-effective amendment thereto on or prior to the Closing Date
and on or prior to any Additional Closing Date, the Registration
Statement and any such post-effective amendment 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 in order to make the statements therein not misleading;
and as of the date of the Prospectus and any amendment or
supplement thereto and as of the Closing Date and as of the
Additional Closing Date, as the case may be, the Prospectus 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; provided that the Company makes no
representation and warranty with respect to any statements or
omissions made in reliance upon and in conformity with information
relating to any Underwriter furnished to the Company in writing by
such Underwriter through the Representative expressly for use in
the Registration Statement and the Prospectus and any amendment or
supplement thereto, it being understood and agreed that the only
such information furnished by any Underwriter consists of the
information described as such in Section 7(b)
hereof.
(e) Incorporated Documents.
The documents incorporated by reference in the Registration
Statement, the Prospectus and the Pricing Disclosure Package, when
they were filed with the Commission conformed in all material
respects to the requirements of the Exchange Act, and none of such
documents contained any untrue statement of a material fact or
omitted to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were
made, not misleading; and any further documents so filed and
incorporated by reference in the Registration Statement, the
Prospectus or the Pricing Disclosure Package on or prior to the
Closing Date and on or prior to any Additional Closing Date, when
such documents are filed with the Commission, will conform in all
material respects to the requirements of the Exchange Act and will
not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading.
(f) Financial Statements. The
financial statements (including the related notes thereto) of the
Company and its consolidated subsidiaries included or incorporated
by reference in the Registration Statement, the Pricing Disclosure
Package and the Prospectus comply in all material respects with the
applicable requirements of the Securities Act and the Exchange Act,
as applicable, and present fairly the financial position of the
Company and its consolidated subsidiaries as of the dates indicated
and the results of their operations and the changes in their cash
flows for the periods specified in accordance with generally
accepted accounting principles in the United States
(“GAAP”) applied on a consistent basis throughout the
periods covered thereby, and any supporting schedules included or
incorporated by reference in the Registration Statement presented
fairly the information required to be stated therein; and other
financial information included or incorporated by reference in the
Registration Statement, the Pricing Disclosure Package and the
Prospectus has been derived from the accounting records of the
Company and its consolidated subsidiaries and presents fairly, in
all material respects, the information shown thereby.
(g) No Material Adverse
Change. Since the date of the most recent financial statements
of the Company included or incorporated by reference in the
Registration Statement, the Pricing Disclosure Package and the
Prospectus, (i) there has not been any change in the capital
stock (other than the issuance of shares of Common Stock upon
exercise of stock options
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or vesting of awards described as
outstanding in, and the grant of options and awards under existing
equity incentive plans described in, the Registration Statement,
the Pricing Disclosure Package and the Prospectus), material change
in the short-term debt or long-term debt of the Company or any of
its subsidiaries, or any dividend or distribution of any kind
declared, set aside for payment, paid or made by the Company on any
class of capital stock, or any material adverse change, or any
development involving a prospective material adverse change, in or
affecting the business, properties, management, financial position,
stockholders’ equity, results of operations or prospects of
the Company and its subsidiaries taken as a whole;
(ii) neither the Company nor any of its subsidiaries has
entered into any transaction or agreement (whether or not in the
ordinary course of business) that is material to the Company and
its subsidiaries taken as a whole or incurred any liability or
obligation, direct or contingent, that is material to the Company
and its subsidiaries taken as a whole; and (iii) neither the
Company nor any of its subsidiaries has sustained any loss or
interference with its business that is material to the Company and
its subsidiaries taken as a whole and that is either from fire,
explosion, flood or other calamity, whether or not covered by
insurance, or from any labor disturbance or dispute or any action,
order or decree of any court or arbitrator or governmental or
regulatory authority, except in each case as otherwise disclosed in
the Registration Statement, the Pricing Disclosure Package and the
Prospectus.
(h) Organization and Good
Standing. The Company, each of its subsidiaries set forth on
Schedule 2 hereto (the “Significant Subsidiaries”) and,
to the Company’s knowledge, any of its subsidiaries that are
not Significant Subsidiaries have been duly organized and are
validly existing and in good standing under the laws of their
respective jurisdictions of organization, are duly qualified to do
business and are in good standing 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 requisite power and authority necessary to own or hold their
respective properties and to conduct the businesses in which they
are engaged, except where the failure to be so qualified or in good
standing or have such power or authority would not, individually or
in the aggregate, have a material adverse effect on the business,
properties, management, financial position, stockholders’
equity, prospects (to the extent disclosed in the Pricing
Disclosure Package) or results of operations of the Company and its
subsidiaries taken as a whole or on the performance by the Company
of its obligations under this Agreement (a “Material Adverse
Effect”). The Company does not have any “significant
subsidiaries” (within the meaning of Rule 1-02 of Regulation
S-X under the Exchange Act) other than the Significant
Subsidiaries.
(i) Capitalization. The
Company has an authorized capitalization as set forth in the
Registration Statement, the Pricing Disclosure Package and the
Prospectus under the heading “Capitalization”; all the
outstanding shares of capital stock of the Company have been duly
and validly authorized and issued and are fully paid and
non-assessable and are not subject to any pre-emptive or similar
rights; except as described in or expressly contemplated by the
Pricing Disclosure Package and the Prospectus, there are no
outstanding rights (including, without limitation, pre-emptive
rights), warrants or options to acquire, or instruments convertible
into or exchangeable for, any shares of capital stock or other
equity interest in the Company or any of its subsidiaries, or any
contract, commitment, agreement, understanding or arrangement of
any kind relating to the issuance of any capital stock of the
Company or any such subsidiary, any such convertible or
exchangeable securities or any such rights, warrants or options;
the capital stock of the Company conforms in all material respects
to the description thereof contained in the Registration Statement,
the Pricing Disclosure Package and the Prospectus; and all the
outstanding shares of capital stock or other equity interests of
each subsidiary owned, directly or indirectly, by the Company have
been duly and validly authorized and issued, are fully paid
and
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non-assessable and are owned
directly or indirectly by the Company, free and clear of any lien,
charge, encumbrance, security interest, restriction on voting or
transfer or any other claim of any third party.
(j) Stock Options. With
respect to the stock options (the “Stock Options”)
granted pursuant to the stock-based compensation plans of the
Company and its subsidiaries (the “Company Stock
Plans”), (i) each Stock Option intended to qualify as an
“incentive stock option” under Section 422 of the
Code so qualifies, (ii) each grant of a Stock Option was duly
authorized no later than the date on which the grant of such Stock
Option was by its terms to be effective (the “Grant
Date”) by all necessary corporate action, including, as
applicable, approval by the board of directors of the Company (or a
duly constituted and authorized committee thereof) and any required
stockholder approval by the necessary number of votes or written
consents, and the award agreement governing such grant (if any) was
duly executed and delivered by each party thereto, (iii) each
such grant was made, in all material respects, in accordance with
the terms of the Company Stock Plans, the Exchange Act and all
other applicable laws and regulatory rules or requirements,
including the rules of the Nasdaq Global Select Market and any
other exchange on which Company securities are traded, and
(iv) each such grant was properly accounted for, in all
material respects, in accordance with GAAP in the financial
statements (including the related notes) of the Company and
disclosed in the Company’s filings with the Commission in
accordance with the Exchange Act and all other applicable laws. The
Company has not knowingly granted, and there is no and has been no
policy or practice of the Company of granting, Stock Options prior
to, or otherwise coordinating the grant of Stock Options with, the
release or other public announcement of material information
regarding the Company or its subsidiaries or their results of
operations or prospects.
(k) Due Authorization. The
Company has all requisite right, power and authority to execute and
deliver this Agreement and to perform its obligations hereunder;
and all action required to be taken for the due and proper
authorization, execution and delivery by it of this Agreement and
the consummation by it of the transactions contemplated hereby has
been duly and validly taken.
(l) Underwriting Agreement.
This Agreement has been duly authorized, executed and delivered by
the Company.
(m) The Shares. The Shares to
be issued and sold by the Company hereunder have been duly
authorized and, when issued and delivered and paid for as provided
herein, will be duly and validly issued, will be fully paid and
non-assessable and will conform to the descriptions thereof in the
Registration Statement, the Pricing Disclosure Package and the
Prospectus; and the issuance of the Shares is not subject to any
preemptive or similar rights; the Rights Agreement has been duly
authorized, executed and delivered by the Company and constitutes a
valid and legally binding agreement of the Company enforceable
against the Company in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency
or similar laws affecting creditors’ rights generally or by
equitable principles relating to enforceability; and the Rights
Stock has been duly authorized by the Company and validly reserved
for issuance upon the exercise in accordance with the terms of the
Rights Agreement and will be validly issued, fully paid and
non-assessable.
(n) No Violation or Default.
None of the Company, any of its Significant Subsidiaries, or, to
the Company’s knowledge, any of its subsidiaries that are not
Significant Subsidiaries is (i) in violation of its charter or
by-laws or similar organizational documents; (ii) in default,
and no event has occurred that, with notice or lapse of time or
both, would constitute such a
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default, in the due performance or
observance of any term, covenant or condition contained in any
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of
the Company or any of its subsidiaries is subject; or (iii) in
violation of any law or statute or any judgment, order, rule or
regulation of any court or arbitrator or governmental or regulatory
authority, except, in the case of clauses (ii) and
(iii) above, for any such default or violation that would not,
individually or in the aggregate, have a Material Adverse
Effect.
(o) No Conflicts. The
execution, delivery and performance by the Company of this
Agreement, the issuance and sale of the Shares and the consummation
of the transactions contemplated by this Agreement will not
(i) conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default under, or
result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company, any of its
Significant Subsidiaries, or, to the Company’s knowledge, any
of its subsidiaries that are not Significant Subsidiaries pursuant
to, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company, any of its
Significant Subsidiaries, or, to the Company’s knowledge, any
of its subsidiaries that are not Significant Subsidiaries is a
party or by which the Company, any of its Significant Subsidiaries,
or, to the Company’s knowledge, any of its subsidiaries that
are not Significant Subsidiaries is bound or to which any of the
property or assets of the Company, any of its Significant
Subsidiaries, or, to the Company’s knowledge, any of its
subsidiaries that are not Significant Subsidiaries is subject,
(ii) result in any violation of the provisions of the charter
or by-laws or similar organizational documents of the Company, any
of its Significant Subsidiaries, or, to the Company’s
knowledge, any of its subsidiaries that are not Significant
Subsidiaries or (iii) result in the violation of any law or
statute or any judgment, order, rule or regulation of any court or
arbitrator or governmental or regulatory authority, except, in the
case of clauses (i) and (iii) above, for any such
conflict, breach, violation or default that would not, individually
or in the aggregate, have a Material Adverse Effect.
(p) No Consents Required. No
consent, approval, authorization, order, license, registration or
qualification of or with any court or arbitrator or governmental or
regulatory authority is required for the execution, delivery and
performance by the Company of this Agreement, the issuance and sale
of the Shares and the consummation of the transactions contemplated
by this Agreement, except for the registration of the Shares under
the Securities Act and such consents, approvals, authorizations,
orders and registrations or qualifications as may be required by
the Financial Industry Regulatory Authority, Inc.
(“FINRA”) and under applicable state securities laws in
connection with the purchase and distribution of the Shares by the
Underwriters.
(q) Legal Proceedings. Except
as described in the Registration Statement, the Pricing Disclosure
Package and the Prospectus, there are no legal, governmental or
regulatory investigations, actions, suits or proceedings pending to
which the Company or any of its subsidiaries is a party or to which
any property of the Company or any of its subsidiaries is the
subject that, individually or in the aggregate, if determined
adversely to the Company or any of its subsidiaries, could
reasonably be expected to have a Material Adverse Effect; no such
investigations, actions, suits or proceedings, to the knowledge of
the Company, are threatened or contemplated by any governmental or
regulatory authority or threatened by others; and (i) there
are no current or pending legal, governmental or regulatory
actions, suits or proceedings that are required under the
Securities Act to be described in the Registration Statement, the
Pricing Disclosure Package or the Prospectus that are not so
described in the Registration Statement, the Pricing Disclosure
Package and the Prospectus and (ii) there are no statutes,
regulations or
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contracts or other documents that
are required under the Securities Act to be filed as exhibits to
the Registration Statement or described in the Registration
Statement, the Pricing Disclosure Package or the Prospectus that
are not so filed as exhibits to the Registration Statement or
described in the Registration Statement, the Pricing Disclosure
Package and the Prospectus.
(r) Independent Accountants .
Ernst & Young LLP, who have certified certain financial
statements of the Company and its consolidated subsidiaries, is an
independent registered public accounting firm with respect to the
Company and its subsidiaries within the applicable rules and
regulations adopted by the Commission and the Public Company
Accounting Oversight Board (United States) and as required by the
Securities Act.
(s) Title to Real and Personal
Property . The Company and its subsidiaries have good and
marketable title in fee simple (in the case of owned real property)
to, or have valid and marketable rights to lease or otherwise use,
all items of real and personal property and assets that are
material to the respective businesses of the Company and its
subsidiaries, in each case free and clear of all liens,
encumbrances, claims and defects and imperfections of title except
those that (i) do not materially interfere with the use made
and proposed to be made of such property by the Company and its
subsidiaries or (ii) could not reasonably be expected,
individually or in the aggregate, to have a Material Adverse
Effect.
(t) Intellectual Property .
The Company and its subsidiaries own or possess adequate rights to
use all patents, patent applications, trademarks, service marks,
trade names, trademark registrations, service mark registrations,
copyrights, licenses and know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures) (collectively,
“Intellectual Property Rights”) necessary for the
conduct of their respective businesses as currently conducted,
except as would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect and the conduct of
their respective businesses does not infringe, misappropriate or
otherwise conflict with any Intellectual Property Rights of others,
except as would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect. The Company and its
subsidiaries have not received any written notice of any claim of
infringement, misappropriation or conflict with any Intellectual
Property Rights of others, except as would not, individually or in
the aggregate, reasonably be expected to have a Material Adverse
Effect. There is no pending or, to the Company’s knowledge,
threatened action, suit, proceeding or claim by others that the
Company or its subsidiaries infringes, misappropriates or otherwise
conflicts with the Intellectual Property Rights of others, other
than as disclosed in the Registration Statement, Prospectus or
Pricing Disclosure Package. There is no pending or, to the
Company’s knowledge, threatened action, suit, proceeding or
notice of claim by others challenging the validity or
enforceability of any Intellectual Property Rights that are
material to the conduct of the businesses of the Company and its
subsidiaries as currently conducted, and none of the patents owned
by the Company or any of its subsidiaries has been adjudged to be
invalid or unenforceable in whole or in part. For purposes of this
section, the term “to the Company’s knowledge”
includes without limitation, the knowledge of the Company’s
chief legal officer.
(u) No Undisclosed
Relationships . No relationship, direct or indirect, exists
between or among the Company or any of its subsidiaries, on the one
hand, and the directors, officers, stockholders, customers or
suppliers of the Company or any of its subsidiaries, on the other,
that is required by the Securities Act to be described in the
Registration Statement and the Prospectus and that is not so
described in such documents and in the Pricing Disclosure
Package.
9
(v) No Rating . Neither the
Company nor any of its subsidiaries has or guarantees any debt
securities or preferred stock that are rated by a “nationally
recognized statistical rating organization,” as such term is
defined by the Commission for purposes of Rule 436(g)(2) under the
Securities Act.
(w) Investment Company Act .
The Company is not and, after giving effect to the offering and
sale of the Shares and the application of the proceeds thereof as
described in the Registration Statement, the Pricing Disclosure
Package and the Prospectus, will not be required to register as an
“investment company” or an entity
“controlled” by an “investment company”
within the meaning of the Investment Company Act of 1940, as
amended, and the rules and regulations of the Commission thereunder
(collectively, the “Investment Company
Act”).
(x) Taxes. The Company and
its Significant Subsidiaries have paid all federal, state, local
and foreign taxes and filed all tax returns required to be paid or
filed through the date hereof; and except as otherwise disclosed in
the Registration Statement, the Pricing Disclosure Package and the
Prospectus there is no tax deficiency that has been, or could
reasonably be expected to be, asserted against the Company or any
of its subsidiaries or any of their respective properties or assets
that would reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect.
(y) Licenses and Permits. The
Company and its subsidiaries possess all licenses, certificates,
permits and other authorizations issued by, and, to the
Company’s knowledge, have made all declarations and filings
with, the appropriate federal, state, local or foreign governmental
or regulatory authorities that are necessary for the ownership or
lease of their respective properties or the conduct of their
respective businesses as described in the Registration Statement,
the Pricing Disclosure Package and the Prospectus, except where the
failure to possess or make the same would not, individually or in
the aggregate, reasonably be expected to have a Material Adverse
Effect; and except as described in the Registration Statement, the
Pricing Disclosure Package and the Prospectus, or except as would
not reasonably be expected to have a Material Adverse Effect,
neither the Company nor any of its subsidiaries has received notice
of any proceedings related to revocation or modification of any
such license, certificate, permit or authorization.
(z) Compliance with Subject
Laws. Except as (i) otherwise described in the
Registration Statement, the Pricing Disclosure Package or the
Prospectus and/or (ii) that would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse
Effect, the Company, (A) is and for the past three
(3) years has been in material compliance with all statutes,
rules or regulations applicable to the manufacture, packaging,
distribution, import, export or disposal of any product
manufactured or distributed by the Company (“Applicable
Laws”); (B) has not received written notice of any
claim, action, suit or proceeding, or any judgment or order of any
court or federal, state, local or foreign governmental or
regulatory authority (each a, “Governmental Authority”)
alleging that any product operation or activity is in violation of
any Applicable Laws and has no knowledge that any such Governmental
Authority is considering any such claim, action, suit or
proceeding; (C) has filed, obtained, maintained or submitted
all documents as required by any Applicable Laws and that all such
documents were complete and correct, in all material respects, on
the date filed (or were corrected or supplemented by a subsequent
submission); and (D) has not initiated, conducted, or issued
or caused to be initiated, conducted or issued, any recall, market
withdrawal or replacement or post sale warning relating to the
alleged lack of safety of any product or any alleged product defect
or violation and, to the Company’s knowledge, no third party
has initiated or conducted any such notice or action.
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(aa) Compliance with OSHA.
The Company, to its knowledge, is in compliance in all material
respects with any and all applicable foreign, federal, state and
local laws, rules, regulations, treaties, statutes and codes
promulgated by any and all Governmental Authorities (including
pursuant to the Occupational Health and Safety Act) relating to the
protection of human health and safety in the workplace
(“Occupational Laws”). No action, proceeding,
revocation proceeding, writ, injunction or claim is pending or, to
the Company’s knowledge, threatened against the Company
relating to Occupational Laws.
(bb) No Labor Disputes. No
labor disturbance by or dispute with employees of the Company or
any of its subsidiaries exists or, to the knowledge of the Company,
is contemplated or threatened, except as would not reasonably be
expected to have a Material Adverse Effect.
(cc) Compliance with and
Liability under Environmental Laws. Except as described in the
Registration Statement, the Pricing Disclosure Package and the
Prospectus, (i) the Company and its subsidiaries (a) are
in material compliance with any and all applicable federal, state,
local and foreign laws, rules, regulations, requirements,
decisions, and orders relating to pollution or the protection of
the environment, natural resources or human health or safety,
including those relating to the generation, storage, treatment,
use, handling, transportation, Release or threat of Release of
Hazardous Materials (as such terms are defined in (dd) below)
(collectively, “Environmental Laws”), (b) have
received and are in material compliance with all permits, licenses,
certificates or other authorizations or approvals required of them
under applicable Environmental Laws to conduct their respective
businesses, (c) have not received notice of any actual or
potential liability under or relating to any Environmental Laws,
including for the investigation or remediation of any Release or
threat of Release of Hazardous Materials, and have no knowledge of
any event or condition that would reasonably be expected to result
in any such notice that could reasonably be expected to have a
Material Adverse Effect; (ii) there are no costs or
liabilities associated with any violation by the Company or its
subsidiaries of Environmental Laws, except for any costs or
liabilities as would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect;
(iii) there are no claims or proceedings that are pending
against the Company or any of its subsidiaries under any
Environmental Laws in which a governmental entity is also a party,
other than such claims or proceedings regarding which it is
reasonably believed no monetary sanctions of $100,000 or more will
be imposed; and (iv) the Company and its subsidiaries are not
aware of any facts or issues regarding compliance with
Environmental Laws, or liabilities or other obligations under
Environmental Laws, including the Release or threat of Release of
Hazardous Materials, that could reasonably be expected to have a
Material Adverse Effect.
(dd) Hazardous Materials . To
the knowledge of the Company, there has been no storage,
generation, transportation, use, handling, treatment, Release or
threat of Release of Hazardous Materials by, relating to or caused
by the Company or any of its subsidiaries (or, to the knowledge of
the Company and its subsidiaries, any other entity (including any
predecessor) for whose acts or omissions the Company or any of its
subsidiaries is or could reasonably be expected to be liable) upon
any property now or previously owned or leased by the Company or
any of its subsidiaries, or upon any other property, in violation
of any Environmental Laws or in a manner or to a location that
could reasonably be expected to result in any liability for which
the Company or any of its subsidiaries is or could reasonably be
expected to be liable under any Environmental Law, except for any
violation or liability which would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect. “Hazardous Materials” means any material,
chemical, substance, waste, pollutant, contaminant, compound,
mixture, or constituent thereof, in any form or amount, including
petroleum (including crude oil or any fraction thereof) and
petroleum products, natural gas liquids, asbestos and asbestos
containing
11
materials, naturally occurring
radioactive materials, brine, and drilling mud, regulated or which
can give rise to liability under any Environmental Law.
“Release” means any spilling, leaking, seepage,
pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, dumping, disposing, depositing, dispersing, or
migrating in, into or through the environment, or in, into, from or
through any building or structure.
(ee) Compliance with ERISA.
(i) Each employee benefit plan, within the meaning of
Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended (“ERISA”), for which the Company or
any member of its “Controlled Group” (defined as any
organization which is a member of a controlled group of
corporations within the meaning of Section 414 of the Internal
Revenue Code of 1986, as amended (the “Code”)) would
have any liability (each, a “Plan”) has been maintained
in compliance with its terms and the requirements of any applicable
statutes, orders, rules and regulations, including but not limited
to ERISA and the Code, except as would not reasonably be expected
to have a Material Adverse Effect; (ii) no prohibited
transaction, within the meaning of Section 406 of ERISA or
Section 4975 of the Code, has occurred with respect to any
Plan, excluding transactions effected pursuant to a statutory or
administrative exemption, that would reasonably be expected to
result in a Material Adverse Effect; and (iii) for each Plan
that is subject to the funding rules of Section 412 of the
Code or Section 302 of ERISA, the minimum funding standard of
Section 412 of the Code or Section 302 of ERISA, as
applicable, has been satisfied (without taking into account any
waiver thereof or extension of any amortization period) and is
reasonably expected to be satisfied in the future (without taking
into account any waiver thereof or extension of any amortization
period), except where such failure to satisfy the minimum funding
standard would not reasonably be expected to have a Material
Adverse Effect.
(ff) Disclosure Controls .
The Company and its consolidated subsidiaries maintain an effective
system of “disclosure controls and procedures” (as
defined in Rule 13a-15(e) of the Exchange Act) that complies in all
material respects with the requirements of the Exchange Act and
that has been designed to provide a reasonable level of assurance
that information required to be disclosed by the Company in reports
that it files or submits under the Exchange Act is recorded,
pr
