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Xenogen Corporation
7,000,000 Shares
Common Stock
($0.001 Par Value)
UNDERWRITING AGREEMENT
________ __, 2001
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UNDERWRITING AGREEMENT
________ __, 2001
UBS Warburg LLC
CIBC World Markets Corp.
Dain Rauscher Incorporated
As representatives of the several Underwriters
named in Schedule A hereto
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c/o UBS Warburg LLC
299 Park Avenue
New York, New York 10171-0026
Ladies and Gentlemen:
Xenogen Corporation, a Delaware corporation (the "Company"), proposes
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to issue and sell to the Underwriters named in Schedule A annexed hereto (the
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"Underwriters") an aggregate of 7,000,000 shares (the "Firm Shares") of common
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stock, $0.001 par value per share, of the Company (the "Common Stock"). In
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addition, solely for the purpose of covering over-allotments, the Company
proposes to grant to the Underwriters the option to purchase from the Company up
to an additional 1,050,000 shares of Common Stock (the "Additional Shares").
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The Firm Shares and the Additional Shares are hereinafter collectively sometimes
referred to as the "Shares." The Shares are described in the Prospectus which
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is referred to below.
The Company hereby acknowledges that in connection with the proposed
offering of the Shares, it has requested UBS Warburg LLC ("UBSW") to administer
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a directed share program (the "Directed Share Program") under which up to
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350,000 Firm Shares, or 5% of the Firm Shares, to be purchased by you (the
"Reserved Shares") shall be reserved for sale by you at the initial public
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offering price to the Company's officers, directors, employees, and consultants
and others having a relationship with the Company (the "Directed Share
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Participants") as part of the distribution of the Shares by the Underwriters,
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subject to the terms of this Agreement, the applicable rules, regulations and
interpretations of the National Association of Securities Dealers, Inc. ("NASD")
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and all other applicable laws, rules and regulations. The number of Shares
available for sale to the general public will be reduced to the extent that
Directed Share Participants purchase Reserved Shares. You may offer any
Reserved Shares not purchased by Directed Share Participants to the general
public on the same basis as the other Shares being issued and sold hereunder.
The Company has supplied UBSW with the names, addresses and telephone numbers of
the individuals or other entities which the Company has designated to be
participants in the Directed Share Program. It is understood that any number of
those designated to participate in the Directed Share Program may decline to do
so.
The Company has filed, in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations thereunder
(collectively, the "Act"), with the
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Securities and Exchange Commission (the "Commission") a registration statement
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on Form S-1 (File No. 333-47030) including a prospectus, relating to the Shares.
The Company has furnished to you, for use by the Underwriters and by dealers,
copies of one or more preliminary prospectuses (each thereof being herein called
a "Preliminary Prospectus") relating to the Shares. Except where the context
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therwise requires, the registration statement, as amended when it becomes
effective, including all documents filed as a part thereof, and including any
information contained in a prospectus subsequently filed with the Commission
pursuant to Rule 424(b) under the Act and deemed to be part of the registration
statement at the time of effectiveness pursuant to Rule 430(A) under the Act,
and also including any registration statement filed pursuant to Rule 462(b)
under the Act with respect to the offering contemplated by the Registration
Statement, is herein called the "Registration Statement," and the prospectus, in
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the form filed by the Company with the Commission pursuant to Rule 424(b) under
the Act on or before the second business day after the date hereof (or such
earlier time as may be required under the Act) or, if no such filing is
required, the form of final prospectus included in the Registration Statement at
the time the Registration Statement became effective, is herein called the
"Prospectus."
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The Company and the Underwriters agree as follows:
1. Sale and Purchase. Upon the basis of the representations and
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warranties and subject to the terms and conditions herein set forth, the Company
agrees to sell to the respective Underwriters and each of the Underwriters,
severally and not jointly, agrees to purchase from the Company the aggregate
number of Firm Shares set forth opposite the name of such Underwriter in
Schedule A attached hereto, in each case at a purchase price of $____ per Share.
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The Company is advised by you that the Underwriters intend (i) to make a public
offering of their respective portions of the Firm Shares as soon after the
effective date of the Registration Statement as in your judgment is advisable
and (ii) initially to offer the Firm Shares upon the terms set forth in the
Prospectus. You may from time to time increase or decrease the public offering
price after the initial public offering to such extent as you may determine.
In addition, the Company hereby grants to the several Underwriters the
option to purchase, and upon the basis of the representations and warranties and
subject to the terms and conditions herein set forth, the Underwriters shall
have the right to purchase, severally and not jointly, from the Company, ratably
in accordance with the number of Firm Shares to be purchased by each of them,
all or a portion of the Additional Shares as may be necessary to cover over-
allotments made in connection with the offering of the Firm Shares, at the same
purchase price per share to be paid by the Underwriters to the Company for the
Firm Shares. This option may be exercised by you on behalf of the several
Underwriters at any time and from time to time on or before the thirtieth (30th)
day following the date hereof, by written notice to the Company. Such notice
shall set forth the aggregate number of Additional Shares as to which the option
is being exercised and the date and time when the Additional Shares are to be
delivered (such date and time being herein referred to as the "additional time
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of purchase"); provided, however, that the additional time of purchase shall not
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not be earlier than the time of
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purchase (as defined below) nor earlier than the second business day/1/ after
the date on which the option shall have been exercised nor later than the tenth
business day after the date on which the option shall have been exercised. The
number of Additional Shares to be sold to each Underwriter shall be the number
which bears the same proportion to the aggregate number of Additional Shares
being purchased as the number of Firm Shares set forth opposite the name of such
Underwriter on Schedule A hereto bears to the total number of Firm Shares
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(subject, in each case, to such adjustment as you may determine to eliminate
fractional shares).
2. Payment and Delivery. Payment of the purchase price for the
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Firm Shares shall be made to the Company by Federal Funds wire transfer against
delivery of the certificates for the Firm Shares to you through the facilities
of the Depository Trust Company ("DTC") for the respective accounts of the
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Underwriters. Such payment and delivery shall be made at 10:00 A.M., New York
City time, on _________ __, 2001 (unless another time shall be agreed to by you
and the Company or unless postponed in accordance with the provisions of Section
9 hereof). The time at which such payment and delivery are actually made is
hereinafter sometimes called the "time of purchase." Certificates for the Firm
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Shares shall be delivered to you in definitive form in such names and in such
denominations as you shall specify on the second business day preceding the time
of purchase. For the purpose of expediting the checking of the certificates for
the Firm Shares by you, the Company agrees to make such certificates available
to you for such purpose at least one full business day preceding the time of
purchase.
Payment of the purchase price for the Additional Shares shall be made
at the additional time of purchase in the same manner and at the same office as
the payment for the Firm Shares. Certificates for the Additional Shares shall
be delivered to you in definitive form in such names and in such denominations
as you shall specify no later than the second business day preceding the
additional time of purchase. For the purpose of expediting the checking of the
certificates for the Additional Shares by you, the Company agrees to make such
certificates available to you for such purpose at least one full business day
preceding the additional time of purchase.
Deliveries of the documents described in Section 7 below with respect
to the purchase of the Shares shall be made at the offices of Dewey Ballantine
LLP, 1301 Avenue of the Americas, New York, New York at 9:00 A.M., New York City
time, on the date of the closing of the purchase of the Firm Shares or the
Additional Shares, as the case may be.
3. Representations and Warranties. The Company represents and
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warrants to each of the Underwriters that:
(a) This Agreement has been duly authorized, executed and delivered
by the Company and is a legal, valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms.
__________________________
/1/ As used herein "business day" shall mean a day on which th New York
Stock Exchange is open for trading.
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(b) The Shares have been duly and validly authorized and, when issued
and delivered against payment therefor as provided herein, will be duly and
validly issued, fully paid and non-assessable. The holders of the Shares
will not be subject to personal liability by reason of being such holders.
The certificates for the Shares are in due and proper form and conform in
all material respects to the requirements of the Delaware General
Corporation Law.
(c) No approval, authorization, consent or order of or filing with
any national, state or local governmental or regulatory commission, board,
body, authority or agency is required in connection with the execution,
delivery and performance by the Company of this Agreement, the issuance and
sale of the Shares contemplated hereby and by the Registration Statement,
other than registration of the Shares under the Act and under the
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder (collectively, the "Exchange Act"), which have been or will be
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effected by the Company, and any necessary qualification under the
securities or blue sky laws of the various jurisdictions in which the
Shares are being offered by the Underwriters or under the rules and
regulations of the NASD.
(d) The Company has not received, and has no notice of, any order of
the Commission preventing or suspending the use of any Preliminary
Prospectus, or instituting proceedings for that purpose, and each
Preliminary Prospectus, at the time of filing thereof, conformed in all
material respects to the requirements of the Act. When the Registration
Statement became or becomes effective, the Registration Statement and the
Prospectus complied or will comply in all material respects with the
provisions of the Act, and the Registration Statement did not or will not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading, and the Prospectus did not or will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading
and the Prospectus, any Preliminary Prospectus and any supplement thereto
or prospectus wrapper prepared in connection therewith, at their respective
times of issuance and at the time of closing, complied and will comply in
all material respects with any applicable laws or regulations of
jurisdictions in which the Prospectus and such preliminary prospectus, as
amended or supplemented, if applicable, are distributed in connection with
the offer and sale of the Shares, provided, however, that the Company makes
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no representation or warranty with respect to any statement contained in
the Registration Statement or the Prospectus in reliance upon and in
conformity with information concerning the Underwriters and furnished in
writing by or on behalf of any Underwriter through you to the Company
expressly for use in the Registration Statement or the Prospectus. Neither
the Company nor, to the Company's knowledge, any of its affiliates (as
defined in the Act) has distributed directly or indirectly any offering
material in connection with the offering or sale of the Shares other than
the Registration Statement, the Preliminary Prospectus, the Prospectus or
any other materials, if any, permitted by the Act.
(e) The audited financial statements of the Company included in the
Registration Statement and the Prospectus present fairly the financial
position and results of
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operations of the Company as of the dates and for the periods indicated;
such financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis during the
periods involved; the pro forma financial data included in the Registration
Statement and the Prospectus comply as to form in all material respects
with the applicable accounting requirements of Regulation S-X of the
Securities Act, and the pro forma adjustments have been properly applied to
the historical amounts in the compilation of those statements; the other
financial and statistical data set forth in the Registration Statement and
the Prospectus are accurately presented and prepared on a basis consistent
with such financial statements and the books and records of the Company;
and there are no financial statements (historical or pro forma) that are
required to be included in the Registration Statement and the Prospectus
that are not included as required.
(f) Ernst & Young LLP, whose report on the financial statements of
the Company is filed with the Commission as part of the Registration
Statement and Prospectus, are independent public accountants as required by
the Act.
(g) All legal or governmental proceedings, all statutes and
regulations and all contracts, leases or documents of a character required
to be described in the Registration Statement or the Prospectus or to be
filed as an exhibit to the Registration Statement have been so described or
filed as required. All statistical and market-related data included in the
Prospectus are based on or derived from sources that the Company believes
to be reliable and accurate, and the Company has obtained the written
consent to the use of such data from such sources to the extent required.
(h) Except as set forth in the Registration Statement and the
Prospectus: (i) no person has the right, contractual or otherwise, to cause
the Company to issue to it, or register pursuant to the Act, any shares of
capital stock or other equity interests; and (ii) no person has any
preemptive rights, co-sale rights, rights of first refusal or other rights
to purchase any shares of Common Stock. No person has the right,
contractual or otherwise, to cause the Company to register under the Act
any shares of capital stock or other equity interests as a result of the
filing or effectiveness of the Registration Statement or the sale of the
Shares as contemplated thereby.
(i) Immediately after the issuance and sale of the Shares to the
Underwriters, no shares of preferred stock of the Company shall be issued
and outstanding, and no holder of any shares of capital stock, securities
convertible into or exchangeable or exercisable for capital stock or
options, warrants or other rights to purchase capital stock or any other
securities of the Company shall have any existing or future right to
acquire any shares of preferred stock of the Company.
(j) The Company is not, and after the offering and sale of the
Shares, will not be, an "investment company" or an entity "controlled" by
an "investment company," as such terms are defined in the Investment
Company Act of 1940, as amended (the "Investment Company Act").
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(k) The Company has obtained for the benefit of the Underwriters the
agreement (a "Lock-Up Agreement") of each of its officers and directors
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and each of its holders of Common Stock and securities convertible into or
exchangeable or exercisable for Common Stock (including options and
warrants) not to sell, offer to sell, contract to sell, hypothecate,
pledge, grant any option to sell or otherwise dispose of, directly or
indirectly, or file or participate in the filing of a registration
statement under the Act relating to the offer and sale of, any shares of
Common Stock or securities convertible into or exercisable or exchangeable
for Common Stock or options, warrants or other rights to purchase Common
Stock or any other securities of the Company that are substantially similar
to Common Stock for a period of one hundred and eighty (180) days after the
date of the Prospectus without the prior written consent of UBSW.
(l) Neither the Company nor any of its affiliates has taken, directly
or indirectly, any action designed to or which has constituted or which
might reasonably be expected to cause or result, under the Exchange Act or
otherwise, in stabilization or manipulation of the price of any security of
the Company to facilitate the sale or resale of the Shares.
(m) The Company has been duly organized and is validly existing as a
corporation and is in good standing under the laws of the State of
Delaware, and has full power and authority to own, lease and operate its
properties and conduct its business as described in the Registration
Statement.
(n) The Company is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction in which the
ownership or leasing of its properties or the conduct of its business
requires such qualification, except where the failure to so qualify would
have a material adverse effect on the business, prospects, properties,
condition (financial or otherwise) or results of operation of the Company
and the Subsidiary (as defined herein), taken as a whole (a "Material
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Adverse Effect"). The Company does not have any subsidiaries (as defined in
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the Act) other than Chrysalis DNX Transgenic Sciences Corporation (the
"Subsidiary"). The Company owns 100% of the outstanding capital stock of
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the Subsidiary. Other than the Subsidiary, the Company does not own,
directly or indirectly, any shares of stock or any other equity or long-
term debt securities of any corporation or have any equity interest in any
firm, partnership, limited liability company, joint venture, association or
other entity except as contemplated by the Prospectus and set forth in the
Registration Statement and the Prospectus. Complete and correct copies of
the charter and bylaws and other organizational documents of the Company
and the Subsidiary and all amendments thereto have been delivered to you,
and except as described in the Prospectus and set forth in the exhibits to
the Registration Statement, no changes therein will be made subsequent to
the date hereof and prior to the time of purchase or, if later, the
additional time of purchase. The Subsidiary has been duly organized and is
validly existing as a corporation and is in good standing under the laws of
the jurisdiction of its incorporation, and has the full power and authority
to own, lease and operate its properties and conduct its business, except
where the failure to be so organized or existing would not have a Material
Adverse Effect. The Subsidiary is duly qualified to do business as a
foreign corporation and is in good standing in each jurisdiction in which
the ownership or leasing of its properties or the conduct of its business
requires such qualification, except where the
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failure to so qualify would not have a Material Adverse Effect. All of the
outstanding shares of capital stock of the Subsidiary has been duly and
validly authorized and issued and are fully paid and non-assessable and
owned by the Company, free of any security interest, other encumbrance or
adverse claims, have been issued in compliance with all federal and state
securities laws and have not been issued in violation of any preemptive
right, resale right, right of first refusal or similar right. No option,
warrant or other rights to purchase, agreements or other obligations to
issue or rights to convert any obligation into shares of capital stock or
ownership interests in the Subsidiary are outstanding.
(o) The capital stock of the Company, including the Shares, conforms
in all material respects to the description thereof contained in the
Registration Statement and Prospectus. As of the date of this Agreement,
the Company has an authorized and outstanding capital stock as set forth
under the heading entitled "Actual" in the section of the Registration
Statement and the Prospectus entitled "Capitalization" and, as of the time
of purchase, and assuming the receipt and application of the net proceeds
as described under the section of the Registration Statement and the
Prospectus entitled "Use of proceeds," the Company shall have an authorized
and outstanding capital stock as set forth under the heading entitled "Pro
forma as adjusted" in the section of the Registration Statement and the
Prospectus entitled "Capitalization." All of the outstanding shares of
capital stock of the Company have been duly and validly authorized and
issued and are fully paid and non-assessable, have been issued in
compliance with all federal and state securities laws and have not have
been issued in violation of any preemptive right, resale right, right of
first refusal or similar right. The shares of Common Stock issuable upon
conversion of the outstanding preferred stock of the Company upon
completion of the offering contemplated hereby have been duly and validly
authorized and reserved for issuance, and upon issuance, they will be duly
and validly issued and fully paid and non-assessable, will have been issued
in compliance with all federal and state securities laws and will not have
been issued in violation of any preemptive right, resale right, right of
first refusal or similar right.
(p) Neither the Company nor the Subsidiary has violated or is in
violation of any federal, state, local or foreign law, ordinance,
administrative or governmental rule or regulation applicable to the Company
or the Subsidiary or of any decree of any court or governmental agency or
body having jurisdiction over the Company or the Subsidiary, which
violation could, individually or in the aggregate, have a Material Adverse
Effect.
(q) Neither the Company nor the Subsidiary is in breach or violation
of, or in default under (and no event has occurred which with notice, lapse
of time, or both would result in any breach or violation of, or constitute
a default under), its charter or bylaws or other organizational documents
or in the performance or observance of any obligation, agreement, covenant
or condition contained in any indenture, mortgage, deed of trust, bank loan
or credit agreement or other evidence of indebtedness, or any lease,
contract or other agreement or instrument to which the Company or the
Subsidiary is a party or by which either of them or any of their properties
is bound or affected, the effect of which could individually or in the
aggregate have a Material Adverse Effect. The execution, delivery and
performance of this Agreement and the issuance and sale of the Shares
contemplated hereby and by the Registration Statement will not conflict
with, or result in
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any breach or violation of, or constitute a default under), its charter or
bylaws or other organizational documents or in the performance or
observance of any obligation, agreement, covenant or condition contained in
any indenture, mortgage, deed of trust, bank loan or credit agreement or
other evidence of indebtedness, or any lease, contract or other agreement
or instrument to which the Company or the Subsidiary is a party or by which
either of them or any of their properties is bound or affected, the effect
of which could individually or in the aggregate have a Material Adverse
Effect. The execution, delivery and performance of this Agreement and the
issuance and sale of the Shares contemplated hereby and by the Registration
Statement will not conflict with, or result in any breach or violation of
or constitute a default under (nor constitute any event which with notice,
lapse of time, or both would result in any breach or violation of, or
constitute a default under), any provisions of the charter or bylaws or
other organizational documents of the Company or the Subsidiary or under
any provision of any license, permit, franchise, indenture, mortgage, deed
of trust, bank loan or credit agreement or other evidence of indebtedness,
or any lease, contract or other agreement or instrument to which the
Company or the Subsidiary is a party or by which either of them or their
properties may be bound or affected, or under any federal, state, local or
foreign law, regulation or rule or any decree, judgment or order applicable
to the Company or the Subsidiary, the result of which could individually or
in the aggregate have a Material Adverse Effect; and the execution,
delivery and performance of this Agreement and the issuance and sale of the
Shares contemplated hereby and by the Registration Statement will not
conflict with, or result in any breach or violation of, constitute a
default under (nor constitute any event which with notice, lapse of time,
or both would result in any breach or violation 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 the Subsidiary
pursuant to any indenture, mortgage, deed of trust, bank loan or credit
agreement or other evidence of indebtedness, or any lease, contract or
other agreement or instrument to which the Company or the Subsidiary is a
party or by which either of them or any of their properties is bound or
affected, the result of which could individually or in the aggregate have a
Material Adverse Effect.
(r) Each of the Company and the Subsidiary has all necessary
licenses, permits, franchises, authorizations, consents and approvals, and
made all filings required under any federal, state, local or foreign law,
regulation or rule, and has obtained all necessary authorizations, consents
and approvals from other persons, in order to conduct its business; and
neither the Company nor the Subsidiary is in violation of, or in default
under, any such license, permit, franchise, authorization, consent or
approval, the effect of which could individually or in the aggregate have a
Material Adverse Effect.
(s) There are no private or governmental actions, suits, claims,
investigations or proceedings pending, threatened or, to the Company's
knowledge, contemplated, to which the Company or the Subsidiary or any of
their directors or officers is subject or of which any of their properties
is subject, whether at law, in equity or before or by any federal, state,
local or foreign governmental or regulatory commission, board, body,
authority or agency.
(t) Except as described in the Registration Statement and the
Prospectus, subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not been
(i) any material adverse change, or any development involving a prospective
material adverse change, in the business, prospects, properties, condition
(financial or otherwise) or results of operations of the Company and the
Subsidiary, taken as a whole, (ii) any transaction that is material to the
Company and the Subsidiary, taken as a whole, (iii) the incurrence by the
Company or the Subsidiary of any obligation, direct or contingent, and
whether or not in the ordinary course of business, which is material to the
Company and the Subsidiary, taken as a whole, (iv) any change in the
capital stock or other equity interest or outstanding indebtedness of the
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Company or the Subsidiary or (v) any dividend or distribution of any kind
declared, paid or made on the capital stock or other equity interest of the
Company. Neither the Company nor the Subsidiary has any contingent
obligations that are material to the Company and the Subsidiary, taken as a
whole, and are not disclosed in the Registration Statement.
(u) The Company owns or has obtained enforceable licenses for the
patents, patent applications, inventions, technology, trademarks, trademark
registrations, service marks, service mark registrations, trade names,
copyrights, trade secrets and rights described in the Prospectus as being
owned or used by or licensed to the Company or the Subsidiary or necessary
for the conduct of their respective businesses as currently conducted
(collectively, the "Intellectual Property"). Except as set forth in the
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Prospectus, there are no rights of third parties to any such Intellectual
Property; and to the Company's knowledge, there is no infringement by third
parties of any such Intellectual Property. There is no pending or, to the
Company's knowledge, threatened action, suit, proceeding or claim by others
(i) challenging the Company's rights in or to any such Intellectual
Property; (ii) challenging the validity or scope of any such Intellectual
Property; or (iii) that the Company or the Subsidiary infringes or
otherwise violates, or would infringe or otherwise violate upon
commercialization of its products and product candidates described in the
Prospectus, any patent, trademark, copyright, trade secret or other
proprietary rights of others; and the Company is unaware of any facts which
would form a reasonable basis for of the claims described in clauses (i),
(ii) and (iii) above. To the Company's knowledge there is no patent or
patent application which contains claims that dominate or may dominate any
Intellectual Property described in the Prospectus as being owned by or
licensed to the Company or the Subsidiary or that is necessary for the
conduct of their respective businesses as currently or contemplated to be
conducted or that interferes with the issued or pending claims of any such
Intellectual Property. There is no prior art of which the Company is aware
that may render any patent held by the Company invalid or any patent
application held by the Company unpatentable which has not been disclosed
to the U.S. Patent and Trademark Office. The commercial products and
product candidates of the Company and the Subsidiary described in the
Prospectus read on the claims contained in the patents and patent
applications described in the Prospectus.
(v) Each of the Company and the Subsidiary has good and marketable
title to all property (real and personal) described in the Prospectus as
being owned by them, free and clear of all liens, claims, security
interests or other encumbrances except such as are described in the
Registration Statement and the Prospectus and except as would not
individually or in the aggregate have a Material Adverse Effect. All the
property held under lease by the Company or the Subsidiary is held thereby
under valid, subsisting and enforceable leases.
(w) Each of the Company and the Subsidiary is insured by insurers of
recognized financial responsibility against such losses and risks and in
such amount as are customary in the business in which it is engaged. All
policies of insurance insuring the Company, the Subsidiary or any of their
businesses, assets, employees, officers and directors are in full force and
effect, and each of the Company and the Subsidiary is in compliance with
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the terms of such policies in all material respects. There are no claims by
the Company or the Subsidiary under any such policy or instrument as to
which any insurance company is denying liability or defending under a
reservation of rights clause.
(x) The Company has neither sent nor received any notice of
termination of any of the contracts or agreements referred to or described
in, or filed as an exhibit to, the Registration Statement, and no such
termination has been threatened by the Company or any other party to any
such contract or agreement.
(y) Since the date of the latest audited financial statements
included in the Prospectus, neither the Company nor the Subsidiary has
sustained any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree, otherwise
than as disclosed in the Prospectus or other than any loss or interference
which could individually or in the aggregate have a Material Adverse
Effect.
(z) The Company and the Subsidiary maintain a system of internal
accounting controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's general or
specific authorization; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management's
general or specific authorization; and (iv) the recorded accountability for
assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(aa) Each of the Company and the Subsidiary has filed all federal,
state, local and foreign tax returns and tax forms required to be filed.
Such returns and forms are complete and correct in all material respects,
and all taxes shown by such returns or otherwise assessed that are due or
payable have been paid, except such taxes as are being contested in good
faith and as to which adequate reserves have been provided. All payroll
withholdings required to be made by the Company and the Subsidiary with
respect to employees have been made. The charges, accruals and reserves on
the books of the Company and the Subsidiary in respect of any tax liability
for any year not finally determined are adequate to meet any assessments or
reassessments for additional taxes. There have been no tax deficiencies
asserted and, to the Company's knowledge, no tax deficiency might be
reasonably asserted or threatened against the Company or the Subsidiary
that could individually or in the aggregate have a Material Adverse Effect.
In addition, any certificate signed by any officer of the Company,
delivered to the Representatives or counsel for the Underwriters in connection
with the offering of the Shares shall be deemed to be a representation and
warranty by the Company, as to matters covered thereby, to each Underwriter.
4. Representations and Warranties of the Underwriters. You, on behalf
--------------------------------------------------
of the several Underwriters, represent and warrant to the Company that the
information provided by you and set forth in the fifth, sixth, eighth, ninth,
tenth, eleventh, twelfth and fourteenth
10
<PAGE>
paragraphs under the caption "Underwriting" in the Prospectus constitute the
only information provided by or on behalf of the Underwriters through you for
use in the Registration Statement and the Prospectus. You represent and warrant
that you have been authorized by each of the other Underwriters to enter into
this Agreement on behalf of each of the other Underwriters and to act for each
of them in the manner herein provided.
5. Certain Covenants. The Company hereby agrees:
-----------------
(a) to furnish such information as may be required and otherwise to
cooperate in qualifying the Shares for offering and sale under the
securities or blue sky laws of such states as you may designate and to
maintain such qualifications in effect so long as required for the
distribution of the Shares; provided, however, that the Company shall not
-------- -------
be required to qualify as a foreign corporation or to consent to the
service of process under the laws of any such state (except service of
process with respect to the offering and sale of the Shares); and to
promptly advise you of the receipt of any notification with respect to the
suspension of the qualification of the Shares for sale in any jurisdiction
or the initiation or threatening of any proceeding for such purpose;
(b) to make available to the Underwriters in New York City, as soon
as practicable after the Registration Statement becomes effective, and
thereafter from time to time to furnish to the Underwriters, as many copies
of the Prospectus (or of the Prospectus as amended or supplemented if the
Company shall have made any amendments or supplements thereto after the
effective date of the Registration Statement) as the Underwriters may
request for the purposes contemplated by the Act; in case any Underwriter
is required to deliver a prospectus beyond the nine-month period referred
to in Section 10(a)(3) of the Act in connection with the sale of the
Shares, the Company will prepare promptly upon request and at its cost such
amendment or amendments to the Registration Statement and such prospectuses
as may be necessary to permit compliance with the requirements of Section
10(a)(3) of the Act;
(c) to advise you promptly and (if requested by you) to confirm such
advice in writing, (i) when the Registration Statement has become effective
and when any post-effective amendment thereto becomes effective and (ii) if
Rule 430A under the Act is used, when the Prospectus is filed with the
Commission pursuant to Rule 424(b) under the Act (which the Company agrees
to file in a timely manner under such Rules);
(d) to advise you promptly, and to confirm such advice in writing, of
any request by the Commission for amendments or supplements to the
Registration Statement or Prospectus or for additional information with
respect thereto, or of notice of institution of proceedings for, or the
entry of a stop order suspending the effectiveness of the Registration
Statement and, if the Commission should enter a stop order suspending the
effectiveness of the Registration Statement, to use its best efforts to
obtain the lifting or removal of such order as soon as possible; to advise
you promptly of any proposal to amend or supplement the Registration
Statement or Prospectus and to file no such amendment or supplement to
which you shall object in writing;
11
<PAGE>
(e) subject to Section 5(o) hereof, to file promptly all reports and
any definitive proxy or information statement required to be filed by the
Company with the Commission in order to comply with the Exchange Act
subsequent to the date of the Prospectus and for so long as the delivery of
a prospectus is required in connection with the offering or sale of the
Shares, and to promptly notify you of such filing;
(f) if necessary or appropriate, to file in a timely fashion a
registration statement pursuant to Rule 462(b) under the Act;
(g) to furnish to you and, upon request, to each of the other
Underwriters for a period of five (5) years from the date of this Agreement
(i) copies of any reports or other communications which the Company shall
send to its stockholders or shall from time to time publish or publicly
disseminate, (ii) copies of all annual, quarterly and current reports filed
with the Commission on Forms 10-K, 10-Q and 8-K, or such other similar form
as may be designated by the Commission, (iii) copies of documents or
reports filed with any national securities exchange on which any class of
securities of the Company is listed and (iv) such other information as you
may reasonably request regarding the Company or the Subsidiary as soon as
such communications, documents or information becomes available;
(h) to advise the Underwriters promptly of the occurrence of any
event known to the Company within the time during which a Prospectus
relating to the Shares is required to be delivered under the Act which
would require the making of any change in the Prospectus then being used so
that the Prospectus would not include an untrue statement of a material
fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they are made, not
misleading, and, during such time, to prepare, file (subject to Section
5(d) hereof) and furnish promptly to the underwriters, at the Company's
expense, such amendments or supplements to such Prospectus as may be
necessary to reflect any such change and to furnish you a copy of such
proposed amendment or supplement before filing any such amendment or
supplement with the Commission;
(i) to make generally available to its security holders, and to
deliver to you, as soon as practicable an earnings statement of the Company
(which will satisfy the provisions of Section 11(a) of the Act) covering a
period of twelve (12) months beginning after the effective date of the
Registration Statement (as defined in Rule 158(c) of the Act) and ending
not later than fifteen (15) months thereafter;
(j) to furnish to its stockholders as soon as practicable after the
end of each fiscal year an annual report (including a balance sheet and
statements of income, stockholders' equity and of cash flow of the Company
for such fiscal year, accompanied by a copy of the certificate or report
thereon of nationally recognized independent certified public accountants);
(k) to furnish to you such number of conformed copies of the
Registration Statement, as initially filed with the Commission, and of all
amendments thereto (including all exhibits thereto) as you shall reasonably
request;
12
<PAGE>
(l) to furnish to you as early as practicable prior to the time of
purchase and the additional time of purchase, as the case may be, but not
later than two (2) business days prior thereto, a copy of the latest
available quarterly or monthly unaudited interim consolidated financial
statements of the Company and the Subsidiary, which have been read by the
Company's independent certified public accountants, as stated in their
letter to be furnished pursuant to Section 7(d) hereof;
(m) to apply the net proceeds from the sale of the Shares in the
manner set forth under the caption "Use of proceeds" in the Prospectus;
(n) to pay all costs, expenses, fees and taxes in connection with (i)
the preparation and filing of the Registration Statement, each Preliminary
Prospectus, the Prospectus, and any amendments or supplements thereto, and
the printing and furnishing of copies of each thereof to the Underwriters
and to dealers (including costs of mailing and shipment), (ii) the
registration, issue, sale and delivery of the Shares, (iii) the producing,
word processing and/or printing of this Agreement, any agreement Among
Underwriters, any dealer agreements, any Powers of Attorney and any closing
documents (including compilations thereof) and the reproduction and/or
printing and furnishing of copies of each thereof to the Underwriters and
(except closing documents) to dealers (including costs of mailing and
shipment), (iv) the qualification of the Shares for offering and sale under
state laws and the determination of their eligibility for investment under
state law as aforesaid (including the reasonable legal fees and filing fees
and other disbursements of counsel for the Underwriters) and the printing
and furnishing of copies of any blue sky surveys or legal investment
surveys to the Underwriters and to dealers, (v) all out-of-pocket expenses
(including the reasonable legal fees and filing fees and other
disbursements of counsel for the Underwriters) incurred by the Underwriters
in administering the Directed Share Program, (vi) any listing of the Shares
on any securities exchange or qualification of the Shares for quotation on
the National Association of Securities Dealers Automated Quotation National
Market System ("NASDAQ") and any registration thereof under the Exchange
------
Act, (vii) the review of the public offering of the Shares by the NASD,
including the associated filing fees and the reasonable fees and
disbursements of counsel for the Underwriters and (viii) the performance of
the Company's other obligations hereunder;
(o) to furnish to you, before filing with the Commission subsequent
to the effective date of the Registration Statement and during the period
referred to in paragraph (h) above, a copy of any document proposed to be
filed pursuant to Section 13, 14 or 15(d) of the Exchange Act;
(p) not to sell, offer to sell, contract to sell, hypothecate,
pledge, grant any option to sell or otherwise dispose of, directly or
indirectly, any shares of Common Stock or securities convertible into or
exchangeable or exercisable for Common Stock or options, warrants or other
rights to purchase Common Stock or any other shares of the Company that are
substantially similar to Common Stock or file a registration statement
under the Act relating to the offer and sale of any shares of Common Stock
or securities convertible into or exercisable or exchangeable for Common
Stock or options, warrants or other rights to purchase Common Stock or any
other shares of the Company that are
13
<PAGE>
substantially similar to Common Stock for a period of one hundred and
eighty (180) days after the date hereof (the "Lock-up Period"), without the
--------------
prior written consent of UBSW, except for (i) the registration of the
Shares and the sales to the Underwriters pursuant to this Agreement, (ii)
issuances of Common Stock upon the exercise of outstanding options or
warrants as disclosed in the Registration Statement and the Prospectus to
persons who have entered into Lock-Up Agreements with the Underwriters and
(iii) the issuance of employee stock options not exercisable during the
Lock-up Period pursuant to stock option plans described in the Registration
Statement and the Prospectus; and
(q) to use its best efforts to cause the Common Stock to be listed
for quotation on the Nasdaq National Market.
6. Reimbursement of Underwriters' Expenses. The Company agrees that
---------------------------------------
if the Shares are not delivered for any reason, other than the termination of
this Agreement pursuant to subsections (ii), (iii) or (iv) of the second
paragraph of Section 8 hereof or the last paragraph of Section 9 hereof or the
default by one or more of the Underwriters in its or their respective
obligations hereunder, it shall, in addition to paying the amounts described in
Section 5(n) hereof, reimburse the Underwriters for all of the out-of-pocket
accountable expenses actually incurred by the Underwriters, including the
reasonable fees and disbursements of their counsel.
7. Conditions of Underwriters' Obligations. The several obligations
---------------------------------------
of the Underwriters hereunder are subject to the accuracy of the representations
and warranties of the Company on the date hereof and at the time of purchase as
if made at the time of purchase (and the several obligations of the Underwriters
at the additional time of purchase are subject to the accuracy of the
representations and warranties of the Company on the date hereof and at the time
of purchase (unless previously waived) and at the additional time of purchase,
as the case may be, as if made at such time), the timely performance by the
Company of its obligations hereunder and to the following additional conditions
precedent:
(a) The Company shall furnish to you at the time of purchase and at
the additional time of purchase, as the case may be, an opinion of Wilson
Sonsini Goodrich & Rosati, P.C., counsel for the Company, addressed to the
Underwriters, and dated the time of purchase or the additional time of
purchase, as the case may be, with reproduced copies for each of the other
Underwriters and in form reasonably satisfactory to Dewey Ballantine LLP,
counsel for the Underwriters, stating that:
(i) the Company has been duly incorporated and is validly
existing as a corporation and is in good standing under the laws of
the State of Delaware and has full power and authority to own, lease
and operate its properties and conduct its business as described in
the Registration Statement and the Prospectus, to execute and deliver
this Agreement and to issue, sell and deliver the Shares as herein
contemplated;
(ii) the Subsidiary has been duly incorporated and is validly
existing as a corporation and is in good standing under the laws of
its jurisdiction of incorporation and has full power and authority to
own, lease and operate its
14
<PAGE>
properties and conduct its business as described in the Registration
Statement and the Prospectus;
(iii) each of the Company and the Subsidiary is duly qualified
to do business as a foreign corporation and is in good standing in
each jurisdiction in which the ownership or leasing of its properties
or the conduct of its business requires such qualification, except
where the failure to so qualify would not have a Material Adverse
Effect;
(iv) this Agreement has been duly authorized, executed and
delivered by the Company;
(v) the Shares have been duly authorized and, when issued and
delivered to and paid for by the Underwriters, will be validly issued,
fully paid and non-assessable;
(vi) the Company has authorized and outstanding shares of
capital stock as set forth in the Registration Statement and the
Prospectus; the outstanding shares of capital stock of the Company (A)
have been duly and validly authorized and issued and are fully paid
and non-assessable, (B) are free of any preemptive rights, resale
rights, rights of first refusal and similar rights under the Delaware
General Corporation Law or under any contract, agreement or instrument
described in or filed as an exhibit to the Registration Statement or
otherwise known to such counsel and (C) to such counsel's knowledge,
were issued in compliance with all applicable federal and state
securities laws; the Shares when issued will be free of any preemptive
rights, resale rights, rights of first refusal and similar rights
under the Delaware General Corporation Law or the charter or bylaws or
other organizational documents of the Company or under any contract,
agreement or instrument known to such counsel, and the holders of the
Shares will not be subject to personal liability by reason of being
such holders; the certificates for the Shares are in due and proper
form and conform in all material respects to the requirements of the
Delaware General Corporation Law;
(vii) all of the outstanding shares of capital stock of the
Subsidiary have been duly authorized and validly issued, are fully
paid and non-assessable, are owned of record by the Company, are not
subject to any perfected security interest or, to such counsel's
knowledge, any other encumbrance or adverse claim and, to such
counsel's knowledge, have been issued and sold in compliance with all
applicable federal and state securities laws; to such counsel's
knowledge, no options, warrants or other rights to purchase,
agreements or other obligations to issue or other rights to convert
any obligation into shares of capital stock or ownership interests in
the Subsidiary are outstanding.
(viii) the capital stock of the Company, including the Shares,
conforms as to legal matters to the description thereof contained in
the Registration Statement and Prospectus;
15
<PAGE>
(ix) the Registration Statement and the Prospectus (except as
to the financial statements and schedules and other financial and
statistical data contained therein, as to which such counsel need
express no opinion) comply as to form in all material respects with
the requirements of the Act;
(x) the Registration Statement has become effective under the
Act and, to such counsel's knowledge, no stop order proceedings with
respect thereto are pending or threatened under the Act and any
required filing of the Prospectus, and any supplement thereto pursuant
to Rule 424 under the Act, has been made in the manner and within the
time period required by such Rule 424;
(xi) no approval, authorization, consent or order of or filing
with any national, state or local governmental or regulatory
commission, board, body, authority or agency is required in connection
with the execution, delivery and performance of this Agreement, the
issuance and sale of the Shares and the consummation of the
transactions contemplated hereby and by the Registration Statement,
other than those that have been obtained under the Act, the Exchange
Act and the rules of the Nasdaq National Market and other than any
necessary qualification under the state securities or blue sky laws of
the various jurisdictions in which the Shares are being offered by the
Underwriters or any necessary approval of the Corporate Financing
Department of NASD Regulation, Inc., as to which such qualification
and approval such counsel need express no opinion;
(xii) the execution, delivery and performance of this Agreement
by the Company and the transactions contemplated hereby and by the
Registration Statement do not and will not conflict with, or result in
any breach or violation of, or constitute a default under (nor
constitute any event which with notice, lapse of time, or both, would
result in any breach or violation 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 the
Subsidiary pursuant to (A) any provisions of the charter or bylaws or
other organizational documents of the Company or the Subsidiary, (B)
any provision of any license, permit, franchise, indenture, mortgage,
deed of trust, bank loan or credit agreement or other evidence of
indebtedness, or any lease, contract or other agreement or instrument
to which the Company or the Subsidiary is a party or by which their
respective properties may be bound or affected that is known by such
counsel, (C) any federal, state, local or foreign law, regulation or
rule or (D) any decree, judgment or order applicable to the Company or
the Subsidiary, or any license, permit or franchise issued to the
Company or the Subsidiary, in each case known to such counsel, or (E)
any contract, indenture, mortgage, deed of trust, loan or credit
agreement, note, lease or any other agreement or instrument, filed as
an exhibit to the Registration Statement or otherwise known to such
counsel, to which the Company or the Subsidiary is a party or by which
either of them may be bound, or to which any of the property or assets
of the Company or the Subsidiary is subject;
16
<PAGE>
(xiii) to such counsel's knowledge, neither the Company nor the
Subsidiary is in violation of its charter or bylaws or other
organizational documents, nor is either of them in breach or violation
of or in default under (nor has any event occurred which with notice,
lapse of time, or both would result in any breach or violation of, or
constitute a default under), any license, permit, franchise,
indenture, mortgage, deed of trust, bank loan or credit agreement or
other evidence of indebtedness, or any lease, contract or other
agreement or instrument to which the Company or the Subsidiary is or
was a party or by which either of them or their respective properties
may be bound or affected or in violation of any federal, state, local
or foreign law, regulation or rule or any decree, judgment or order
applicable to the Company or the Subsidiary, the effect of which would
individually or in the aggregate have a Material Adverse Effect;
(xiv) to such counsel's knowledge, there are no contracts,
licenses, agreements, leases or documents of a character which are
required to be filed as exhibits to the Registration Statement or to
be described in the Prospectus which have not been so filed or
described;
(xv) to such counsel's knowledge, there are no private or
governmental actions, suits, claims, investigations or proceedings
pending, threatened or contemplated to which the Company or the
Subsidiary or any of their directors or officers is subject or of
which any of their properties is subject, whether at law, in equity or
before or by any federal, state, local or foreign governmental or
regulatory commission, board, body, authority or agency which are
required to be described in the Prospectus but are not so described;
(xvi) the Company is not, and after the offering and sale of
the Shares, will not be, an "investment company" or an entity
controlled by an "investment company," as such terms are defined in
the Investment Company Act;
(xvii) those statements in the Prospectus that are descriptions
of contracts, agreements or other legal documents or of legal
proceedings, or refer to statements of law or legal conclusions, are
accurate in all material respects and present fairly the information
required to be shown; and
(xviii) no person has the right, pursuant to the terms of any
contract, agreement or other instrument described in or filed as an
exhibit to the Registration Statement or otherwise known to such
counsel, to cause the Company to register under the Act any shares of
capital stock or other equity interests as a result of the filing or
effectiveness of the Registration Statement or the sale of the Shares
as contemplated hereby; and to such counsel's knowledge, except as
described in the Registration Statement and Prospectus, no person is
entitled to registration rights with respect to shares of capital
stock or other securities of the Company.
In addition, such counsel shall state that it has participated in
conferences with officers and other representatives of the Company,
representatives of the independent public
17
<PAGE>
accountants of the Company and representatives of the Underwriters at which the
contents of the Registration Statement and Prospectus were discussed and,
although such counsel is not passing upon and does not assume responsibility for
the accuracy, completeness or fairness of the statements contained in the
Registration Statement or Prospectus (except as and to the extent stated in
subparagraphs (vi), (viii) and (xvii) above), on the basis of the foregoing
nothing has come to the attention of such counsel that causes such counsel to
believe that the Registration Statement or any amendment thereto at the time
such Registration Statement or amendment became effective contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
that the Prospectus or any supplement thereto at the date of such Prospectus or
such supplement, and at all times up to and including the time of purchase or
additional time of purchase, as the case may be, contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading (it being understood
that such counsel need express no opinion with respect to the financial
statements and schedules and other financial and statistical data included in
the Registration Statement or Prospectus).
(b) You shall have received at the time of purchase and at the
additional time of purchase, as the case may be, the opinion of Wilson
Sonsini Goodrich & Rosati, P.C., intellectual property counsel to the
Company with respect to patents and proprietary rights, dated the time of
purchase or the additional time of purchase, as the case may be, with
reproduced copies for each of the other Underwriters and in form reasonably
satisfactory to Dewey Ballantine LLP, counsel for the Underwriters, stating
that:
(i) To such counsel's knowledge, except as described in the
Prospectus, (A) the Company (either directly or through the
Subsidiary) has valid license rights or clear title to the
Intellectual Property referenced in the Prospectus, and there are no
rights of third parties to any such Intellectual Property; (B) there
is no infringement or other violation by third parties of any of the
Intellectual Property of the Company referenced in the Prospectus; (C)
there is no infringement or other violation by the Company or the
Subsidiary of any Intellectual Property of others; (D) there is no
pending or threatened action, suit proceeding or claim by governmental
authorities or others that the Company or the Subsidiary infringes or
otherwise violates any Intellectual Property of others, and such
counsel is unaware of any facts which would form a reasonable basis
for any such claim; and (E) there is no pending or threatened action,
suit, proceeding or claim by governmental authorities or others
challenging the rights of the Company or the Subsidiary in or to, or
challenging the scope of, any Intellectual Property of the Company or
the Subsidiary referenced in the Prospectus, and such counsel is
unaware of any facts which would form a reasonable basis for any such
claim;
(ii) to such counsel's knowledge, the patent applications of
the Company and the Subsidiary presently on file disclose patentable
subject matter, and such counsel is not aware of any inventorship
challenges, any interference which has been declared or provoked, or
any other material fact with respect to the patent applications of the
Company presently on file that (A) would preclude
18
<PAGE>
the issuance of patents with respect to such applications, or (B)
would lead such counsel to conclude that such patents, when issued,
would not be valid and enforceable in accordance with applicable
regulations; and
(iii) the statements in the Registration Statement and the
Prospectus referencing Intellectual Property matters, insofar as such
statements constitute summaries of legal matters, contracts,
agreements, documents or proceedings referred to therein, or refer to
statements of law or legal conclusions, are in all material respects
accurate and complete statements or summaries of the matters therein
set forth. Nothing has come to such counsel's attention that causes
such counsel to believe that such above described portions of the
Registration Statement, at the time such Registration Statement became
effective, contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, or that such above
described portions of the Prospectus and at the date of the Prospectus
and at all times leading up to and including the time of purchase and
the additional time of purchase, as the case may be, contained an
untrue statement of material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
(c) You shall have received at the time of purchase and at the
additional time of purchase, as the case may be, the favorable opinion of
Dewey Ballantine LLP, counsel for the Underwriters, dated the time of
purchase or the additional time of purchase, as the case may be, with
respect to the issuance and sale of the Shares by the Company, the
Registration Statement, the Prospectus (together with any supplement
thereto) and such other related matters as the Underwriters may require.
(d) You shall have received from Ernst & Young LLP, letters dated,
respectively, the date of this Agreement and the time of purchase and
additional time of purchase, as the case may be, and addressed to the
Underwriters (with reproduced copies for each of the Underwriters) in the
forms heretofore approved by Dewey Ballantine LLP, counsel for the
Underwriters.
(e) No amendment or supplement to the Registration Statement or
Prospectus shall be filed prior to the time the Registration Statement
becomes effective to which you object in writing.
(f) The Registration Statement shall become effective, or if Rule
430A under the Act is used, the Prospectus shall have been filed with the
Commission pursuant to Rule 424(b) under the Act, at or before 5:30 P.M.,
New York City time, on the date of this Agreement, unless a later time (but
not later than 5:30 P.M., New York City time, on the second full business
day after the date of this Agreement) shall be agreed to by the Company and
you in writing or by telephone, confirmed in writing; provided, however,
-------- -------
that the Company and you and any group of Underwriters, including you, who
have agreed hereunder to purchase in the aggregate at least fifty percent
(50%) of the Firm Shares may from time to time agree on a later date.
19
<PAGE>
(g) Prior to the time of purchase or the additional time of purchase,
as the case may be, (i) no stop order with respect to the effectiveness of
the Registration Statement shall have been issued under the Act or
proceedings initiated under Section 8(d) or 8(e) of the Act; (ii) the
Registration Statement and all amendments thereto, or modifications
thereof, if any, shall not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading; and (iii) the Prospectus and
all amendments or supplements thereto, or modifications thereof, if any,
shall not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they are
made, not misleading.
(h) Between the time of execution of this Agreement and the time of
purchase or the additional time of purchase, as the case may be, (i) no
material and adverse change, or any development involving a prospective
material and adverse change (other than as specifically identified in the
Registration Statement and Prospectus), in the business, prospects,
properties, condition (financial or otherwise) or results of operations of
the Company and the Subsidiary, taken as a whole, shall occur or become
known and (ii) no transaction which is material and unfavorable to the
Company shall have been entered into by the Company or the Subsidiary.
(i) The Company will, at the time of purchase or additional time of
purchase, as the case may be, deliver to you a certificate of its President
and its Chief Financial Officer to the effect that the representations and
warranties of the Company as set forth in this Agreement are true and
correct as of each such date, that the Company has performed such of its
obligations under this Agreement as are to be performed at or before the
time of purchase and at or before the additional time of purchase, as the
case may be, and the conditions set forth in paragraphs (f), (g) and (h) of
this Section 7 have been met.
(j) You shall have received signed Lock-Up Agreements, dated the date
of this Agreement, from each of the officers and directors of the Company
and each of the holders of Common Stock and securities convertible into or
exchangeable or exercisable for Common Stock (including options and
warrants), stating that such persons will not sell, offer to sell, contract
to sell, hypothecate, pledge, grant any option to sell or otherwise dispose
of, directly or indirectly, or file or participate in the filing of a
registration statement under the Act relating to the offer and sale of, any
shares of Common Stock or securities convertible into or exchangeable or
exercisable for Common Stock or options, warrants or other rights to
purchase Common Stock or any other securities of the Company that are
substantially similar to Common Stock for a period of one hundred and
eighty (180) days after the date of the Prospectus without the prior
written consent of UBSW.
(k) The Company shall have furnished to you such other documents and
certificates as to the accuracy and completeness of any statement in the
Registration Statement and the Prospectus as of the time of purchase and
the additional time of purchase, as the case may be, as you may reasonably
request.
20
<PAGE>
(l) The Shares shall have been approved for listing for quotation on
the Nasdaq National Market, subject only to notice of issuance at or prior
to the time of purchase or the additional time of purchase, as the case may
be.
8. Effective Date of Agreement; Termination. This Agreement shall
----------------------------------------
become effective (i) if Rule 430A under the Act is not used, when you shall have
received notification of the effectiveness of the Registration Statement, or
(ii) if Rule 430A under the Act is used, when the parties hereto have executed
and delivered this Agreement.
The obligations of the several Underwriters hereunder shall be subject
to termination in the absolute discretion of you or any group of Underwriters
(which may include you) which has agreed to purchase in the aggregate at least
fifty percent (50%) of the Firm Shares, (i) if, since the time of execution of
this Agreement or the respective dates as of which information is given in the
Registration Statement and Prospectus, there has been any material adverse and
unfavorable change, or any development involving a prospective material adverse
change (other than as specifically identified in the Registration Statement and
Prospectus) in the business, prospects, properties, condition (financial or
otherwise) or results of operations of the Company and the Subsidiary taken as a
whole, which would, in your judgment or in the judgment of such group of
Underwriters, make it impracticable to market the Shares, or, (ii) if, at any
time prior to the time of purchase or, with respect to the purchase of any
Additional Shares, the additional time of purchase, as the case may be, trading
in securities on the New York Stock Exchange, the American Stock Exchange or the
Nasdaq National Market shall have been suspended or limitations or minimum
prices shall have been established on the New York Stock Exchange, the American
Stock Exchange or the Nasdaq National Market, or (iii) if a banking moratorium
shall have been declared either by the United States or New York State
authorities, or (iv) if the United States shall have declared war in accordance
with its constitutional processes or there shall have occurred any material
outbreak or escalation of hostilities or other national or international
calamity or crisis of such magnitude in its effect on the financial markets of
the United States as, in your judgment or in the judgment of such group of
Underwriters, to make it impracticable to market the Shares.
If you or any group of Underwriters elects to terminate this Agreement
as provided in this Section 8, the Company and each other Underwriter shall be
notified promptly by letter or telegram.
If the sale to the Underwriters of the Shares, as contemplated by this
Agreement, is not carried out by the Underwriters for any reason permitted under
this Agreement or if such sale is not carried out because the Company shall be
unable to comply with any of the terms of this Agreement, the Company shall not
be under any obligation or liability under this Agreement (except to the extent
provided in Sections 5(n), 6 and 10 hereof), and the Underwriters shall be under
no obligation or liability to the Company under this Agreement (except to the
extent provided in Section 10 hereof) or to one another hereunder.
9. Increase in Underwriters' Commitments. Subject to Sections 7 and
-------------------------------------
8, if any Underwriter shall default in its obligation to take up and pay for the
Firm Shares to be purchased by it hereunder (otherwise than for a reason
sufficient to justify the termination of this Agreement under the provisions of
Section 8 hereof) and if the number of Firm Shares which all
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<PAGE>
Underwriters so defaulting shall have agreed but failed to take up and pay for
does not exceed ten percent (10%) of the total number of Firm Shares, the non-
defaulting Underwriters shall take up and pay for (in addition to the aggregate
number of Firm Shares they are obligated to purchase pursuant to Section 1
hereof) the number of Firm Shares agreed to be purchased by all such defaulting
Underwriters, as hereinafter provided. Such Shares shall be taken up and paid
for by such non-defaulting Underwriter or Underwriters in such amount or amounts
as you may designate with the consent of each Underwriter so designated or, in
the event no such designation is made, such Shares shall be taken up and paid
for by all non-defaulting Underwriters pro rata in proportion to the aggregate
number of Firm Shares set opposite the names of such non-defaulting Underwriters
in Schedule A.
----------
Without relieving any defaulting Underwriter from its obligations
hereunder, the Company agrees with the non-defaulting Underwriters that it will
not sell any Firm Shares hereunder unless all of the Firm Shares are purchased
by the Underwriters (or by substituted Underwriters selected by you with the
approval of the Company or selected by the Company with your approval).
If a new Underwriter or Underwriters are substituted by the
Underwriters or by the Company for a defaulting Underwriter or Underwriters in
accordance with the foregoing provision, the Company or you shall have the right
to postpone the time of purchase for a period not exceeding five (5) business
days in order that any necessary changes in the Registration Statement and
Prospectus and other documents may be effected.
The term Underwriter as used in this Agreement shall refer to and
include any Underwriter substituted under this Section 9 with like effect as if
such substituted Underwriter had originally been named in Schedule A.
----------
If the aggregate number of Shares which the defaulting Underwriter or
Underwriters agreed to purchase exceeds ten percent (10%) of the total number of
Shares which all Underwriters agreed to purchase hereunder, and if neither the
non-defaulting Underwriters nor the Company shall make arrangements within the
five (5) business day period stated above for the purchase of all the Shares
which the defaulting Underwriter or Underwriters agreed to purchase hereunder,
this Agreement shall be terminated without further act or deed and without any
liability on the part of the Company to any non-defaulting Underwriter and
without any liability on the part of any non-defaulting Underwriter to the
Company. Nothing in this paragraph, and no action taken hereunder, shall relieve
any defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
10. Indemnity and Contribution.
--------------------------
(a) The Company agrees to indemnify, defend and hold harmless each
Underwriter, its partners, directors and officers, and any person who
controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and the successors and assigns of all of
the foregoing persons from and against any loss, damage, expense, liability
or claim (including the reasonable cost of investigation) which, jointly or
severally, any such Underwriter or any such person may incur under the Act,
the Exchange Act, the common law or otherwise, insofar as such loss,
damage,
22
<PAGE>
expense, liability or claim arises out of or is based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (or in the Registration Statement as amended by any
post-effective amendment thereof by the Company) or in a Prospectus (the
term Prospectus for the purpose of this Section 10 being deemed to include
any Preliminary Prospectus, the Prospectus and the Prospectus as amended or
supplemented by the Company), or arises out of or is based upon any
omission or alleged omission to state a material fact required to be stated
in either such Registration Statement or Prospectus or necessary to make
the statements made therein not misleading, except insofar as any such
loss, damage, expense, liability or claim arises out of or is based upon
any untrue statement or alleged untrue statement of a material fact
contained in and in conformity with information furnished in writing by or
on behalf of any Underwriter through you to the Company expressly for use
with reference to such Underwriter in such Registration Statement or such
Prospectus or arises out of or is based upon any omission or alleged
omission to state a material fact in connection with such information
required to be stated in such Registration Statement or such Prospectus or
necessary to make such information not misleading or (ii) any untrue
statement or alleged untrue statement made by the Company in Section 3 of
this Agreement or the failure by the Company to perform when and as
required any agreement or covenant contained herein or (iii) any untrue
statement or alleged untrue statement of any material fact contained in any
audio or visual materials provided by the Company or based upon written
information furnished by or on behalf of the Company including, without
limitation, slides, videos, films, tape recordings, used in connection with
the marketing of the Shares or (iv) the Directed Share Program, provided
that, the Company shall not be responsible for any loss, damage, expense,
liability, or claim that is finally judicially determined to have resulted
from the bad faith or gross negligence of the Underwriters in conducting
the Directed Share Program.
If any action, suit or proceeding (together, a "Proceeding") is
----------
brought against an Underwriter or any such person in respect of which indemnity
may be sought against the Company pursuant to the foregoing paragraph, such
Underwriter or such person shall promptly notify the Company in writing of the
institution of such Proceeding and the Company shall assume the defense of such
Proceeding, including the employment of counsel reasonably satisfactory to such
indemnified party and payment of all fees and expenses; provided, however, that
-------- -------
the omission to so notify the Company shall not relieve the Company from any
liability which the Company may have to any Underwriter or any such person or
otherwise. Such Underwriter or such person shall have the right to employ its or
their own counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of such Underwriter or of such person unless the
employment of such counsel shall have been authorized in writing by the Company
in connection with the defense of such Proceeding or the Company shall not have,
within a reasonable period of time in light of the circumstances, employed
counsel to defend such Proceeding or such indemnified party or parties shall
have reasonably concluded that there may be defenses available to it or them
which are different from, additional to or in conflict with those available to
the Company (in which case the Company shall not have the right to direct the
defense of such Proceeding on behalf of the indemnified party or parties), in
any of which events such fees and expenses shall be borne by the Company and
paid as incurred (it being understood, however, that the Company shall not be
liable for the expenses of more than one separate counsel (in addition to any
local counsel) in any one Proceeding or series of related Proceedings
23
<PAGE>
in the same jurisdiction representing the indemnified parties who are parties to
such Proceeding). The Company shall not be liable for any settlement of any
Proceeding effected without the written consent of the Company but if settled
with the written consent of the Company, the Company agrees to indemnify and
hold harmless any Underwriter and any such person from and against any loss or
liability by reason of such settlement. Notwithstanding the foregoing sentence,
if at any time an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for fees and expenses of counsel as
contemplated by the second sentence of this paragraph, then the indemnifying
party agrees that it shall be liable for any settlement of any Proceeding
effected without its written consent if (i) such settlement is entered into more
than sixty (60) days after receipt by such indemnifying party of the aforesaid
request, (ii) such indemnifying party shall not have reimbursed the indemnified
party in accordance with such request prior to the date of such settlement and
(iii) such indemnified party shall have given the indemnifying party at least
thirty (30) days' prior notice of its intention to settle. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened Proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such Proceeding and does not include an admission
of fault, culpability or a failure to act, by or on behalf of such indemnified
party.
(b) In connection with the offer and sale of the Reserved Shares, the
Company agrees to pay UBSW, at its request, the full purchase price of all
Reserved Shares which were subject to a properly confirmed agreement to
purchase and for which any Directed Share Participant failed to pay
therefor and accept delivery thereof.
(c) Each Underwriter severally agrees to indemnify, defend and hold
harmless the Company, its directors and officers, and any person who
controls the Company within the meaning of Section 15 of the Act or Section
20 of the Exchange Act, and the successors and assigns of all of the
foregoing persons from and against any loss, damage, expense, liability or
claim (including the reasonable cost of investigation) which, jointly or
severally, the Company or any such person may incur under the Act, the
Exchange Act, the common law or otherwise, insofar as such loss, damage,
expense, liability or claim arises out of or is based upon any untrue
statement or alleged untrue statement of a material fact contained in and
in conformity with information furnished in writing by or on behalf of such
Underwriter through you to the Company expressly for use with reference to
such Underwriter in the Registration Statement (or in the Registration
Statement as amended by any post-effective amendment thereof by the
Company) or in a Prospectus.
If any Proceeding is brought against the Company or any such person in
respect of which indemnity may be sought against any Underwriter pursuant to the
foregoing paragraph, the Company or such person shall promptly notify such
Underwriter in writing of the institution of such Proceeding and such
Underwriter shall assume the defense of such Proceeding, including the
employment of counsel reasonably satisfactory to such indemnified party and
payment of all fees and expenses; provided, however, that the omission to so
-------- -------
notify such Underwriter shall not relieve such Underwriter from any liability
which such Underwriter may have to the Company or any such person or otherwise.
The Company or such person shall have the right to employ its
24
<PAGE>
own counsel in any such case, but the fees and expenses of such counsel shall be
at the expense of the Company or such person unless the employment of such
counsel shall have been authorized in writing by such Underwriter in connection
with the defense of such Proceeding or such Underwriter shall not have, within a
reasonable period of time in light of the circumstances, employed counsel to
have charge of the defense of such Proceeding or such indemnified party or
parties shall have reasonably concluded that there may be defenses available to
it or them which are different from or additional to or in conflict with those
available to such Underwriter (in which case such Underwriter shall not have the
right to direct the defense of such Proceeding on behalf of the indemnified
party or parties, but such Underwriter may employ counsel and participate in the
defense thereof but the fees and expenses of such counsel shall be at the
expense of such Underwriter), in any of which events such fees and expenses
shall be borne by such Underwriter and paid as incurred (it being understood,
however, that such Underwriter shall not be liable for the expenses of more than
one separate counsel (in addition to any local counsel) in any one Proceeding or
series of related Proceedings in the same jurisdiction representing the
indemnified parties who are parties to such Proceeding). No Underwriter shall be
liable for any settlement of any such Proceeding effected without the written
consent of such Underwriter but if settled with the written consent of such
Underwriter, such Underwriter agrees to indemnify and hold harmless the Company
and any such person from and against any loss or liability by reason of such
settlement. Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the second
sentence of this paragraph, then the indemnifying party agrees that it shall be
liable for any settlement of any Proceeding effected without its written consent
if (i) such settlement is entered into more than sixty (60) days after receipt
by such indemnifying party of the aforesaid request, (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with such
request prior to the date of such settlement and (iii) such indemnified party
shall have given the indemnifying party at least thirty (30) days' prior notice
of its intention to settle. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any pending
or threatened Proceeding in respect of which any indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such Proceeding.
(d) If the indemnification provided for in this Section 10 is
unavailable to an indemnified party under subsections (a), (b) or (c) of
this Section 10 in respect of any losses, damages, expenses, liabilities or
claims referred to therein, then each applicable indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses,
damages, expenses, liabilities or claims (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the other hand from the offering of the
Shares or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and of the
Underwriters on the other in connection with the statements or omissions
which resulted in such losses, damages, expenses, liabilities or claims, as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters on the other
shall be
25
<PAGE>
deemed to be in the same respective proportions as the total proceeds from
the offering (net of underwriting discounts and commissions but before
deducting expenses) received by the Company and the total underwriting
discounts and commissions received by the Underwriters, bear to the
aggregate public offering price of the Shares. The relative fault of the
Company on the one hand and of the Underwriters on the other shall be
determined by reference to, among other things, whether the untrue
statement or alleged untrue statement of a material fact or omission or
alleged omission relates to information supplied by the Company or by the
Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The amount paid or payable by a party as a result of the losses,
damages, expenses, liabilities and claims referred to in this subsection
shall be deemed to include any legal or other fees or expenses reasonably
incurred by such party in connection with investigating, preparing to
defend or defending any Proceeding.
(e) The Company and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 10 were determined
by pro rata allocation (even if the Underwriters were treated as one entity
for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in subsection (c)
above. Notwithstanding the provisions of this Section 10, no Underwriter
shall be required to contribute any amount in excess of the amount by which
the total price at which the Shares underwritten by such Underwriter and
distributed to the public were offered to the public exceeds the amount of
any damage which such Underwriter has otherwise been required to pay by
reason of such untrue statement or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.
The Underwriters' obligations to contribute pursuant to this Section 10 are
several in proportion to their respective underwriting commitments and not
joint.
(f) The indemnity and contribution agreements contained in this
Section 10 and the covenants, warranties and representations of the Company
contained in this Agreement shall remain in full force and effect
regardless of any investigation made by or on behalf of any Underwriter,
its partners, directors or officers or any person (including each partner,
officer or director of such person) who controls any Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, or by
or on behalf of the Company its directors or officers or any person who
controls the Company within the meaning of Section 15 of the Act or Section
20 of the Exchange Act, and shall survive any termination of this Agreement
or the issuance and delivery of the Shares. The Company and each
Underwriter agree promptly to notify each other of the commencement of any
Proceeding against it and, in the case of the Company, against any of the
Company's officers or directors in connection with the issuance and sale of
the Shares, or in connection with the Registration Statement or Prospectus.
11. Notices. Except as otherwise herein provided, all statements,
-------
requests, notices and agreements shall be in writing or by telegram and, if to
the Underwriters, shall be sufficient in all respects if delivered or sent to
UBS Warburg LLC, 299 Park Avenue, New York, New York 10171-0026, Attention:
Syndicate Department and, if to the Company, shall be sufficient
26
<PAGE>
in all respects if delivered or sent to the Company at the offices of the
Company at 860 Atlantic Avenue, Alameda, California 94501, Attention: [ ].
12. Governing Law; Construction. This Agreement and any claim,
---------------------------
counterclaim or dispute of any kind or nature whatsoever arising out of or in
any way relating to this Agreement ("Claim"), directly or indirectly, shall be
-----
governed by, and construed in accordance with, the laws of the State of New
York. The section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this Agreement.
13. Submission to Jurisdiction. Except as set forth below, no Claim
--------------------------
may be commenced, prosecuted or continued in any court other than the courts of
the State of New York located in the City and County of New York or in the
United States District Court for the Southern District of New York, which courts
shall have jurisdiction over the adjudication of such matters, and the Company
consents to the jurisdiction of such courts and personal service with respect
thereto. The Company hereby consents to personal jurisdiction, service and venue
in any court in which any Claim arising out of or in any way relating to this
Agreement is brought by any third party against UBSW or any indemnified party.
Each of UBSW and the Company (on their respective behalfs and, to the extent
permitted by applicable law, on behalf of their respective stockholders and
affiliates) waives all right to trial by jury in any action, proceeding or
counterclaim (whether based upon contract, tort or otherwise) in any way arising
out of or relating to this Agreement. The Company agrees that a final judgment
in any such action, proceeding or counterclaim brought in any such court shall
be conclusive and binding upon the Company and may be enforced in any other
courts in the jurisdiction of which the Company is or may be subject, by suit
upon such judgment.
14. Parties at Interest. The Agreement herein set forth has been and
-------------------
is made solely for the benefit of the Underwriters and the Company and to the
extent provided in Section 10 hereof the controlling persons, directors and
officers referred to in such section, and their respective successors, assigns,
heirs, personal representatives and executors and administrators. No other
person, partnership, association or corporation (including a purchaser, as such
purchaser, from any of the Underwriters) shall acquire or have any right under
or by virtue of this Agreement.
15. Counterparts. This Agreement may be signed by the parties in one
------------
or more counterparts which together shall constitute one and the same agreement
among the parties.
16. Successors and Assigns. This Agreement shall be binding upon the
----------------------
Underwriters, the Company and their successors and assigns and any successor or
assign of any substantial portion of the Company's, and any of the Underwriters'
respective businesses and/or assets.
17. Miscellaneous. UBSW, an indirect, wholly owned subsidiary of UBS
-------------
AG, is not a bank and is separate from any affiliated bank, including any U.S.
branch or agency of UBS AG. Because UBSW is a separately incorporated entity, it
is solely responsible for its own contractual obligations and commitments,
including obligations with respect to sales and purchases of securities.
Securities sold, offered or recommended by UBSW are not deposits, are
27
<PAGE>
not insured by the Federal Deposit Insurance Corporation, are not guaranteed by
a branch or agency, and are not otherwise an obligation or responsibility of a
branch or agency.
A lending affiliate of UBSW may have lending relationships with
issuers of securities underwritten or privately placed by UBSW. To the extent
required under the securities laws, prospectuses and other disclosure documents
for securities underwritten or privately placed by UBSW will disclose the
existence of any such lending relationships and whether the proceeds of the
issue will be used to repay debts owed to affiliates of UBSW.
28
<PAGE>
If the foregoing correctly sets forth the understanding among the
Company and the Underwriters, please so indicate in the space provided below for
the purpose, whereupon this letter and your acceptance shall constitute a
binding agreement among the Company and the Underwriters, severally.
Very truly yours,
XENOGEN CORPORATION
By: _____________________________
Name:
Title:
Accepted and agreed to as of the
date first above written, on behalf of
themselves and the other several Underwriters
named in Schedule A
----------
UBS WARBURG LLC
CIBC WORLD MARKETS CORP.
DAIN RAUSCHER INCORPORATED
By: UBS WARBURG LLC
By: _____________________________
Name:
Title:
By: _____________________________
Name:
Title:
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SCHEDULE A
Number of
Underwriter Firm Shares
----------- -----------
UBS Warburg LLC................................................
CIBC World Markets Corp........................................
Dain Rauscher Incorporated.....................................
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Total....................................................... 7,000,000
===========
30
