Exhibit 1.1
Vital Signs, Inc.
_______ Shares of Common Stock
Underwriting
Agreement
J.P. Morgan Securities Inc.
Piper Jaffray & Co.
As Representatives of the
several Underwriters listed
in Schedule 1 hereto
c/o J.P. Morgan Securities Inc.
277 Park Avenue
New York, New York 10172
Ladies and Gentlemen:
Vital Signs, Inc., a New Jersey
corporation (the “ Company ”), proposes to issue
and sell to the several Underwriters listed in Schedule I hereto
(the “ Underwriters ”), for whom you are acting
as representatives (the “ Representatives ”), an
aggregate of _______ shares of Common Stock, no par value (the
“ Stock ”), of the Company and the stockholders
of the Company named in Schedule II hereto (the “ Selling
Stockholders ”) propose to sell to the Underwriters an
aggregate of shares of Stock and, at the option of
the Underwriters, up to an additional ___________ shares of Stock
to cover over-allotments, if any. The aggregate of shares to be
sold by the Company and the Selling Stockholders is herein called
the “ Underwritten Shares ” and the aggregate of
___________ additional shares to be sold by the Selling
Stockholders at the option of the Underwriters is herein called the
“ Option Shares ”. The Underwritten Shares and
the Option Shares are herein referred to as the “
Shares ”.
The Company and the Selling
Stockholders hereby confirm their 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. 333-130691) including a
prospectus, relating to the Shares. Such registration statement, as
amended at the time it becomes effective, 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 each prospectus
included in such registration statement (and any amendments
thereto) before it becomes effective, any prospectus filed with the
Commission pursuant to Rule
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424(a) under the Securities Act and the
prospectus included in the Registration Statement at the time of
its effectiveness that omits Rule 430 Information, and the term
“ Prospectus ” means the prospectus 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. If the Company has filed an
abbreviated registration statement pursuant to Rule 462(b) under
the Securities Act (the “ Rule 462 Registration
Statement ”), then any reference herein to the term
“ Registration Statement ” shall be deemed to
include such Rule 462 Registration Statement. 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 time when sales
of the Shares were first made (the “ Time of Sale
”), the Company had prepared the following information
(collectively, the “ Time of Sale Information
”): a Preliminary Prospectus dated _____________, 20__, and
each “free-writing prospectus” (as defined pursuant to
Rule 405 under the Securities Act) listed on Annex C hereto. If,
subsequent to the date of this Agreement, the Company and the
Underwriters have determined that such Time of Sale Information
included an untrue statement of a material fact or omitted a
statement of material fact necessary to make the information
therein, in the light of the circumstances under which it was made,
not misleading and have agreed to provide an opportunity to
purchasers of the Shares to terminate their old purchase contracts
and enter into new purchase contracts, then “ Time of Sale
Information ” will refer to the information available to
purchasers at the time of entry into the first such new purchase
contract.
2.
Purchase of the Shares by the Underwriters . (a) The Company
and each of the Selling Stockholders agree, severally and jointly,
to sell the 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 and each of the Selling
Stockholders at a purchase price per share of $ (the “
Purchase Price ”) the number of Underwritten Shares
(to be adjusted by you so as to eliminate fractional shares)
determined by multiplying the aggregate number of Underwritten
Shares to be sold by the Company and each of the Selling
Stockholders as set forth opposite their respective names in
Schedule II hereto by a fraction, the numerator of which is the
aggregate number of Underwritten Shares to be purchased by such
Underwriter as set forth opposite the name of such Underwriter in
Schedule I hereto and the denominator of which is the aggregate
number of Underwritten Shares to be purchased by all the
Underwriters from the Company and all the Selling Stockholders
hereunder.
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In addition, each of the Selling
Stockholders, as and to the extent indicated in Schedule II hereto
agree, severally and not jointly, to sell the Option Shares to the
several Underwriters and the Underwriters shall have the option to
purchase at their election up to ________ Option Shares at the
Purchase Price. The Underwriters, on the basis of the
representations and warranties herein contained, but subject to the
conditions hereinafter stated, shall have the option to purchase,
severally and not jointly, from each of the Selling Stockholders at
the Purchase Price that portion of the number of Option Shares as
to which such election shall have been exercised (to be adjusted by
you so as to eliminate fractional shares) determined by multiplying
such number of Option Shares by a fraction the numerator of which
is the maximum number of Option Shares which such Underwriter is
entitled to purchase and the denominator of which is the maximum
number of Option Shares which all of the Underwriters are entitled
to purchase hereunder. As to each Selling Stockholder, any such
election to purchase Option Shares shall be made in proportion to
the maximum number of Option Shares to be sold by such Selling
Stockholder as set forth in Schedule II hereto.
The Underwriters may exercise the
option to purchase the Option Shares at any time and from time to
time on or before the thirtieth day following the date of this
Agreement, by written notice from the Representatives to the
Attorneys-in-Fact (as defined below). Such notice shall set forth
the aggregate number of Option Shares as to which the option is
being exercised and the business day 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 nor 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
provisions of Section 12 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 and the Selling Stockholders understand 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
Representatives is advisable, and initially to offer the Shares on
the terms set forth in the Prospectus. The Company and the Selling
Stockholders acknowledge and agree that the Underwriters may offer
and sell Shares to or through any affiliate of an Underwriter and
that any such affiliate may offer and sell Shares purchased by it
to or through any Underwriter.
(c) Payment
for the Shares shall be made by wire transfer in immediately
available funds to the accounts specified to the Representatives by
the Company and by the Attorneys-in-Fact, with regard to payment to
the Selling Stockholders, at the offices of Davis Polk &
Wardwell, 450 Lexington Ave., New York, NY 10017 at 10:00 A.M. New
York City time on _____, 2006, or at such other time or place on
the same or such other date, not later than the fifth business day
thereafter, as the Representatives and the Company and the
Attorneys-in-Fact 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 Representatives in the written notice of the
Underwriters’ election to purchase such Option Shares. The
time and date of such payment for the Underwritten Shares are
referred
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to herein as the “ Closing Date
” and the time and date for such payment for the Option
Shares, if other than the Closing Date, are 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
Representatives for the respective accounts of the several
Underwriters of the Shares to be purchased on such date in
definitive form registered in such names and in such denominations
as the Representatives shall request in writing not later than two
full business days prior to the Closing Date or the Additional
Closing Date, as the case may be, with any transfer taxes payable
in connection with the sale of the Shares duly paid by the Company
or the Selling Stockholders, as the case may be. The certificates
for the Shares will be made available for inspection and packaging
by the Representatives at the office of J.P. Morgan Securities Inc.
set forth above 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) Each
of the Company and the Selling Stockholders acknowledges and agrees
that the Underwriters are acting solely in the capacity of an
arm’s length contractual counterparty to the Company and the
Selling Stockholders 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, the Selling Stockholders
or any other person. Additionally, neither the Representatives nor
any other Underwriter is advising the Company, the Selling
Stockholders or any other person as to any legal, tax, investment,
accounting or regulatory matters in any jurisdiction. The Company
and the Selling Stockholders shall consult with their own advisors
concerning such matters and shall be responsible for making their
own independent investigation and appraisal of the transactions
contemplated hereby, and the Underwriters shall have no
responsibility or liability to the Company or the Selling
Stockholders 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 or the Selling Stockholders.
3.
Representations and Warranties of the Company . The Company
represents and warrants to each Underwriter and the Selling
Stockholders 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, at the time of filing
thereof, complied in all material respects with the Securities Act
and did 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, in the light of the
circumstances under which they were made, not misleading;
provided that the Company makes no representation or
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 Representatives expressly for use in any Preliminary
Prospectus.
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(b)
Time of Sale Information . The Time of Sale Information, at
the Time of Sale did not, and at the Closing Date 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 or
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 Representatives expressly for use in such Time of Sale
Information. No statement of material fact included in the
Prospectus has been omitted from the Time of Sale Information and
no statement of material fact included in the Time of Sale
Information that is required to be included in the Prospectus has
been omitted therefrom.
(c)
Issuer Free Writing Prospectus. Other than the Preliminary
Prospectus and the Prospectus, the Company (including its agents
and representatives, other than the Underwriters in their capacity
as such) has not made, used, prepared, authorized, approved or
referred to and will not make, use, prepare, 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 C hereto and other
written communications approved in writing in advance by the
Representatives. Each such Issuer Free Writing Prospectus complied
in all material respects with the Securities Act, has been 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 at the Closing Date 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 or warranty with respect
to any statements or omissions made in any Issuer Free Writing
Prospectus in reliance upon and in conformity with information
relating to any Underwriter furnished to the Company in writing by
such Underwriter through the Representatives expressly for use in
such Issuer Free Writing Prospectus.
(d)
Registration Statement and Prospectus. The Registration
Statement has been declared effective by the Commission. No order
suspending the effectiveness of the Registration Statement has been
issued 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 has been initiated or threatened by the
Commission; as of the applicable effective date of the Registration
Statement and any amendment thereto, the Registration Statement
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 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
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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 or 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 Representatives expressly for use in
the Registration Statement and the Prospectus and any amendment or
supplement thereto.
(e)
Incorporated Documents. The documents incorporated by
reference in the Registration Statement, the Prospectus or the Time
of Sale Information, 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 none of such documents contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein, in 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 Time of Sale Information, 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 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, in the light of the circumstances under
which they were made, not misleading.
(f)
Financial Statements. The financial statements and the
related notes thereto included or incorporated by reference in the
Registration Statement, the Time of Sale Information 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 consolidated financial position
of the Company and its subsidiaries as of the dates indicated and
the consolidated results of their operations and the consolidated
changes in their cash flows for the periods specified; such
financial statements have been prepared in conformity with
generally accepted accounting principles applied on a consistent
basis throughout the periods covered thereby; and the other
financial information included or incorporated by reference in the
Registration Statement, the Time of Sale Information, and the
Prospectus has been derived from the accounting records of the
Company and its subsidiaries and presents fairly 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 Time of Sale
Information, and the Prospectus, (i) there has not been any change
in the capital stock (other than the issuance of Stock upon the
exercise of stock options) or long-term debt of the Company or any
of its subsidiaries, or any dividend (other than regularly
scheduled quarterly dividends) 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 which could reasonably be expected to result in a
material adverse change, in or affecting the business, properties,
management, financial position, stockholders’ equity or
results of operations 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 that is material to the
Company and its subsidiaries taken as a whole or incurred any
liability or obligation, direct or contingent, that is
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material to the Company and its subsidiaries
taken as a whole; and (iii) neither the Company nor any of its
subsidiaries has sustained any material loss or interference with
its business from fire, explosion, flood or other calamity, whether
or not covered by insurance, or from any labor 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 Time of Sale
Information, and the Prospectus.
(h)
Organization and Good Standing. The Company and each of its
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 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 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 or results of operations of the Company
and its subsidiaries taken as a whole (a “ Material
Adverse Effect ”).
(i)
Capitalization. The Company has an authorized capitalization
as set forth in the Registration Statement, the Time of Sale
Information and the Prospectus under the heading
“Capitalization” all the outstanding shares of capital
stock of the Company (including the Shares to be sold by the
Selling Stockholders) 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 Time of Sale Information and the
Prospectus, there are no outstanding rights (including, without
limitation, pre-emptive rights), warrants or options (other than
options granted in the ordinary course pursuant to plans described
in the Registration Statement and the Prospectus) 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 Time of Sale Information and the Prospectus; and all the
outstanding shares of capital stock or other equity interests of
each subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and 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)
Due Authorization. The Company has full 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.
(k)
Underwriting Agreement. This Agreement has been duly
authorized, executed and delivered by the Company.
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(l)
The Shares. The Shares to be issued and sold by the Company
hereunder have been duly authorized by the Company and, when issued
and delivered and paid for as provided herein, will be duly and
validly issued and will be fully paid and nonassessable and will
conform to the descriptions thereof in the Time of Sale Information
and the Prospectus; and the issuance of the Shares is not subject
to any pre-emptive or similar rights.
(m)
Description of the Underwriting Agreement. This Agreements
conforms in all material respects to the description thereof
contained in the Registration Statement, the Time of Sale
Information and the Prospectus.
(n)
No Violation or Default. Neither the Company nor any of its
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 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 to
be sold by the Company hereunder, the issuance by the Company of
the Shares to be issued upon exercise of the Options (as
hereinafter defined) and the consummation by the Company 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 or any of its subsidiaries
pursuant to, 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, (ii) result in
any violation of the provisions of the charter or by-laws or
similar organizational documents of the Company or any of its
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
or violation that could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect and which
would not give rise to any liability for any Underwriter or
purchaser of Stock in the offering contemplated hereby.
(p)
No Consents Required. No consent, approval, authorization,
order, 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 each of
this Agreement, the issuance and sale of the Shares to be sold by
the Company hereunder, the issuance by the
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Company of the Shares to be issued upon the
exercise of the Options and the consummation by the Company 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 under applicable state securities
laws in connection with the purchase and distribution of the Shares
by the Underwriters.
(q)
Legal Proceedings. Except for legal proceedings described in
the Registration Statement, the Time of Sale Information 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 or may be a party or to which
any property of the Company or any of its subsidiaries is or may be
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 or
materially and adversely affect the ability of the Company to
perform its obligations under the this Agreement; to the best
knowledge of the Company, no such investigations, actions, suits or
proceedings 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 that are not so described
in the Registration Statement, the Time of Sale Information and the
Prospectus and (ii) there are no statutes, regulations or 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 or the Prospectus that are not so filed as
exhibits to the Registration Statement or described in the
Registration Statement, the Time of Sale Information and the
Prospectus.
(r)
Independent Accountants. Goldstein Golub Kessler LLP, who
have certified certain financial statements of the Company and its
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 to, or have valid
rights to lease or otherwise use, all items of real and personal
property 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, (ii) are described in the Prospectus or (iii) could
not reasonably be expected, individually or in the aggregate, to
have a Material Adverse Effect.
(t)
Title to Intellectual Property. The Company and its
subsidiaries own or possess adequate rights to use all material
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) necessary for the conduct of
their respective businesses; and, to
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the best knowledge of the Company, the conduct
of their respective businesses does not conflict in any material
respect with any such rights of others.
(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 Time of
Sale Information.
(v)
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 Time of Sale Information 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, “ Investment Company Act
”).
(w)
Taxes. The Company and its subsidiaries have paid, in all
material respects, all federal, state, local and foreign taxes and
filed all material tax returns required to be paid or filed through
the date hereof; and except as otherwise disclosed in the
Registration Statement, the Time of Sale Information and the
Prospectus, there is no material 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.
(x)
Licenses and Permits. The Company and its subsidiaries
possess all licenses, certificates, permits and other
authorizations issued by, and 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 Time of Sale Information and the Prospectus, except
where the failure to possess or make the same would not,
individually or in the aggregate, have a Material Adverse Effect;
and except as described in the Registration Statement, the Time of
Sale Information and the Prospectus, neither the Company nor any of
its subsidiaries has received notice of any revocation or
modification of any such license, certificate, permit or
authorization or has any reason to believe that any such license,
certificate, permit or authorization will not be renewed in the
ordinary course.
(y)
No Labor Disputes. No labor disturbance by or dispute with
employees of the Company or any of its subsidiaries exists or, to
the best knowledge of the Company, is contemplated or threatened,
except as would not have a Material Adverse Effect.
(z)
Compliance With Environmental Laws. (i) The Company and its
subsidiaries (x) are in compliance with any and all applicable
federal, state, local and foreign laws, rules, regulations,
decisions and orders relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes,
pollutants or contaminants (collectively, “ Environmental
Laws ”); (y) have received and are in compliance
with all permits, licenses, certificates or other authorizations or
approvals required of them under applicable
Environmental
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Laws to conduct their respective businesses; and
(z) have not received notice of any actual or potential
liability for the investigation or remediation of any disposal or
release of hazardous or toxic substances or wastes, pollutants or
contaminants, and (ii) there are no costs or liabilities associated
with Environmental Laws of or relating to the Company or its
subsidiaries, except in the case of each of (i) and (ii) above, for
any such failure to comply, or failure to receive required permits,
licenses or approvals, cost or liability, as would not,
individually or in the aggregate, have a Material Adverse
Effect.
(aa)
Compliance With ERISA. Each employee benefit plan, within
the meaning of Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended (“ ERISA ”),
that is maintained, administered or contributed to by the Company
or any of its subsidiaries for employees or former employees of the
Company and its subsidiaries has been maintained in compliance in
all material respects with its terms and the requirements of any
applicable statutes, orders, rules and regulations, including but
not limited to ERISA and the Internal Revenue Code of 1986, as
amended (the “ Code ”); no prohibited
transaction, within the meaning of Section 406 of ERISA or Section
4975 of the Code, has occurred with respect to any such plan
excluding transactions effected pursuant to a statutory or
administrative exemption; and for each such plan that is subject to
the funding rules of Section 412 of the Code or Section 302 of
ERISA, no “accumulated funding deficiency” as defined
in Section 412 of the Code has been incurred, whether or not
waived, and the fair market value of the assets of each such plan
(excluding for these purposes accrued but unpaid contributions)
exceeds the present value of all benefits accrued under such plan
determined using reasonable actuarial assumptions.
(bb)
Disclosure Controls . The Company and its subsidiaries
maintain an effective system of “disclosure controls and
procedures” (as defined in Rule 13a-15(e) of the Exchange
Act) that is designed to ensure that information required to be
disclosed by the Company in reports that it files or submits under
the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the Commission’s rules
and forms, including controls and procedures designed to ensure
that such information is accumulated and communicated to the
Company’s management as appropriate to allow timely decisions
regarding required disclosure. The Company and its subsidiaries
have carried out evaluations of the effectiveness of their
disclosure controls and procedures as required by Rule 13a-15 of
the Exchange Act.
(cc)
Accounting Controls. The Company and its subsidiaries
maintain systems of “internal control over financial
reporting” (as defined in Rule 13a-15(f) of the Exchange Act)
that comply with the requirements of the Exchange Act and have been
designed by, or under the supervision of, their respective
principal executive and principal financial officers, or persons
performing similar functions, to provide reasonable assurance
regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in
accordance with generally accepted accounting principles,
including, but not limited to internal accounting controls
sufficient to provide reasonable assurance that (i) transactions
are executed in accordance with management’s general or
specific authorizations; (ii) transactions are recorded as
necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to
maintain asset accountability; (iii) access to assets is permitted
only in
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accordance with management’s general or
specific authorization; and (iv) the recorded accountability for
assets is compared with the existing assets at reasonable intervals
and appropriate action is taken with respect to any differences.
Except as disclosed in the Registration Statement, the Time of Sale
Information and the Prospectus, there are no material weaknesses in
the Company’s internal controls within the meaning of
Auditing Standard No. 2: An Audit of Internal Control Over
Financial Reporting conducted in Conjunction with an Audit of
Financial Statements (“AS2”), and except as disclosed
in the Registration Statement, the Time of Sale Information and the
Prospectus, there are no significant deficiencies in the
Company’s internal controls within the meaning of AS2 that
have not been substantially remedied by the Company.
(dd)
Insurance. The Company and its subsidiaries have insurance
which is in amounts and insures against such losses and risks as
are reasonable and customary for the business in which they are
engaged; and neither the Company nor any of its subsidiaries has
(i) received notice from any insurer or agent of such insurer that
material capital improvements or other material expenditures are
required or necessary to be made in order to continue such
insurance or (ii) any reason to believe that it will not be able to
renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage at reasonable cost from
similar insurers as may be necessary to continue its
business.
(ee)
No Unlawful Payments. Neither the Company nor any of its
subsidiaries nor, to the best knowledge of the Company, any
director, officer, agent, employee or other person associated with
or acting on behalf of the Company or any of its subsidiaries has
(i) used any corporate funds for any unlawful contribution, gift,
entertainment or other unlawful expense relating to political
activity; (ii) made any direct or indirect unlawful payment to any
foreign or domestic government official or employee from corporate
funds; (iii) violated or is in violation of any provision of the
Foreign Corrupt Practices Act of 1977; or (iv) made any bribe,
rebate, payoff, influence payment, kickback or other unlawful
payment.
(ff)
No Restrictions on Subsidiaries . No subsidiary of the
Company is currently prohibited, directly or indirectly, under any
agreement or other instrument to which it is a party or is subject,
from paying any dividends to the Company, from making any other
distribution on such subsidiary’s capital stock, from
repaying to the Company any loans or advances to such subsidiary
from the Company or from transferring any of such
subsidiary’s properties or assets to the Company or any other
subsidiary of the Company.
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(gg)
No Broker’s Fees. Neither the Company nor any of its
subsidiaries is a party to any contract, agreement or understanding
with any person (other than this Agreement) that would give rise to
a valid claim against the Company or any of its subsidiaries or any
Underwriter for a brokerage commission, finder’s fee or like
payment in connection with the offering and sale of the
Shares.
(hh)
No Registration Rights . No person has the right to require
the Company or any of its subsidiaries to register any securities
for sale under the Securities Act by reason of the filing of the
Registration Statement with the Commission or the issuance and sale
of the Shares to be sold by the Company hereunder or, to the best
knowledge of the Company, the sale of the Shares to be sold by the
Selling Stockholders hereunder.
(ii)
No Stabilization.
The Company has not taken, directly or indirectly, any action
designed to or that could reasonably be expected to cause or result
in any stabilization or manipulation of the price of the
Shares.
(jj)
Forward-Looking Statements. No forward-looking statement
(within the meaning of Section 27A of the Securities Act and
Section 21E of the Exchange Act) contained in the Registration
Statement, the Time of Sale Information and the Prospectus has been
made or reaffirmed without a reasonable basis or has been disclosed
other than in good faith.
(kk)
Statistical and Market Data. Nothing has come to the
attention of the Company that has caused the Company to believe
that the statistical and market-related data included in the
Registration Statement, the Time of Sale Information and the
Prospectus is not based on or derived from sources that are
reliable and accurate in all material respects.
(ll)
The Options . The unissued Shares issuable upon the exercise
of options (the “ Options ”) to be exercised by
certain of the Selling Stockholders (the “
Optionholders ”) have been duly authorized by the
Company and validly reserved for issuance, and at the time of
delivery to the Underwriters with respect to such Shares, such
Shares will be issued and delivered in accordance with the
provisions of the Stock Option Agreements between the Company and
such Selling Stockholders pursuant to which such Options were
granted (the “ Option Agreements ”) and will be
validly issued, fully paid and non-assessable and will conform to
the description thereof in the Time of Sale Information and the
Prospectus.
(mm) The Option
Agreements. The Options were duly authorized and issued
pursuant to the Option Agreements and constitute valid and binding
obligations of the Company and the Optionholders are entitled to
the benefits provided by the Option Agreements; the Option
Agreements were duly authorized, executed and delivered and
constitute valid and legally binding agreements enforceable against
the Company in accordance with their 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 Options and the
Option Agreements conform to the descriptions thereof in the
Prospectus.
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(nn) Sarbanes-Oxley Act .
There is and has been no failure on the part of the Company or any
of the Company’s directors or officers, in their capacities
as such, to comply in any material respect with any 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.
(oo) Status under the Securities
Act . The Company is not an ineligible issuer (as defined in
Rule 405 under the Securities Act) at the times specified in such
Rule in connection with the offering of the Shares.
4. Representations and Warranties
of the Selling Stockholders . Each of the Selling Stockholders
severally, and not jointly, represents and warrants to each
Underwriter and the Company that:
(a) Required Consents;
Authority . All consents, approvals, authorizations and orders
necessary for the execution and delivery by such Selling
Stockholder of this Agreement and the Power of Attorney (the
“ Power of Attorney ”) and the Custody Agreement
(the “ Custody Agreement ”) hereinafter referred
to, and for the sale and delivery of the Shares to be sold by such
Selling Stockholder hereunder, have been obtained, 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 under applicable state securities
laws in connection with the purchase and distribution of the Shares
by the Underwriters; such Selling Stockholder has full right, power
and authority to enter into this Agreement, the Power of Attorney
and the Custody Agreement and to sell, assign, transfer and deliver
the Shares to be sold by such Selling Stockholder hereunder; and
this Agreement, the Power of Attorney and the Custody Agreement
have each been duly authorized, executed and delivered by such
Selling Stockholder.
(b) No Conflicts . The
execution, delivery and performance by such Selling Stockholder of
this Agreement, the Power of Attorney and the Custody Agreement,
the sale of the Shares to be sold by such Selling Stockholder
pursuant to this Agreement and the consummation by such Selling
Stockholder of the transactions herein and therein contemplated
will not (i) conflict with or
