<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 29, 1995
REGISTRATION NO. 33-62009
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 2 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
POSSIS MEDICAL, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
MINNESOTA 41-0783184
(State or other jurisdiction (I.R.S. Employer
of Identification Number)
incorporation or
organization)
</TABLE>
2905 NORTHWEST BOULEVARD
MINNEAPOLIS, MINNESOTA 55441-2644
612/550-1010
(Address, including zip code, and telephone number, including
area code, of Registrant's principal executive offices)
IRVING R. COLACCI, ESQ.
VICE PRESIDENT, LEGAL AFFAIRS AND HUMAN RESOURCES,
GENERAL COUNSEL AND SECRETARY
2905 NORTHWEST BOULEVARD
MINNEAPOLIS, MINNESOTA 55441-2644
612/550-1010
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
------------------------
COPIES TO:
<TABLE>
<S> <C>
David J. Lubben, Esq. D. William Kaufman, Esq.
Amy E. Lange, Esq. Popham, Haik, Schnobrich & Kaufman, Ltd.
Dorsey & Whitney P.L.L.P. 222 South Ninth Street
220 South Sixth Street Minneapolis, MN 55402
Minneapolis, MN 55402 612/334-2644
612/340-2904
</TABLE>
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
AS SOON AS PRACTICABLE AFTER THE REGISTRATION STATEMENT BECOMES EFFECTIVE.
------------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: / /
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: / /
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth estimated expenses payable by the Registrant
in connection with the offering and sale of the Common Stock being registered
hereunder, other than underwriting discounts and commissions. None of the
expenses listed below will be paid by the Selling Shareholders.
<TABLE>
<S> <C>
SEC registration fee.................................................... $ 10,131
NASD filing fee......................................................... 3,438
Nasdaq additional listing fee........................................... 17,500
*Accounting fees and expenses............................................ 25,000
*Legal fees and expenses................................................. 55,000
*Blue sky fees and expenses.............................................. 5,000
*Printing................................................................ 80,000
*Transfer agent and registrar fees....................................... 5,000
*Miscellaneous expenses.................................................. 8,931
---------
Total................................................................ $ 210,000
---------
---------
<FN>
- ------------------------
*All expenses except SEC registration and NASD filing and listing fees are
estimated.
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Unless prohibited in a corporation's articles or bylaws, Minnesota Statutes
302A.521 requires indemnification of officers, directors, employees and agents,
under certain circumstances, against judgments, penalties, fees, settlements and
reasonable expenses (including attorney's fees and disbursements) incurred by
such person in connection with a threatened or pending proceeding with respect
to the acts or omissions of such person in his or her official capacity. The
general effect of Minnesota Statutes 302A.521 is to reimburse (or pay on behalf
of) directors and officers of the Registrant any personal liability that may be
imposed for certain acts performed in their capacity as directors and officers
of the Registrant, except where such persons have not acted in good faith. The
officers and directors of the Registrant have entered into indemnification
agreements with the Registrant.
The Bylaws of the Registrant provide for such indemnification to the maximum
extent permitted by Minnesota Statutes. The Registrant has purchased insurance
covering the liability of its directors and officers.
Under Section 8 of the Underwriting Agreement filed as Exhibit 1 hereto, the
Underwriters and the Selling Shareholders agree to indemnify, under certain
conditions, the Registrant, its directors, certain of its officers and persons
who control the Registrant within the meaning of the Securities Act of 1933, as
amended, against certain liabilities.
II-1
<PAGE>
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
NUMBER DESCRIPTION
- ----------- ----------------------------------------------------------------------------------------------
<S> <C>
1 Form of Underwriting Agreement
4.1* Articles of Incorporation of the Registrant as amended and restated to date (i)
4.2* Bylaws of the Registrant as amended and restated to date (ii)
5* Opinion of Dorsey & Whitney P.L.L.P.
23.1* Consent of Deloitte & Touche LLP, Independent Public Accountants
23.2* Consent of Dorsey & Whitney P.L.L.P. (included in Exhibit 5)
24* Powers of Attorney (included on signature page)
<FN>
- ------------------------
* Previously filed
(i) Incorporated by reference to the Registrant's Annual Report on Form 10-K
for the year ended July 31, 1994, filed with the Commission on October 28,
1994.
(ii) Incorporated by reference to Amendment No. 1 to the Registrant's
Registration Statement on Form S-2, filed with the Commission on August 9,
1994.
</TABLE>
ITEM 17. UNDERTAKINGS
A. Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is
therefore unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
B. The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this Registration Statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4)
or 497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(2) For the purposes of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Amendment No. 2 to
the Registration Statement on Form S-3 to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Minneapolis, State of
Minnesota, on September 29, 1995.
POSSIS MEDICAL, INC.
By: /s/ ROBERT G. DUTCHER
----------------------------------
Robert G. Dutcher
PRESIDENT AND CHIEF EXECUTIVE
OFFICER
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form S-3 has been signed below on September 29, 1995
by the following persons in the capacities indicated:
SIGNATURE TITLE
- --------------------------------------- ---------------------------------------
[CAPTION]
/s/ ROBERT G. DUTCHER
- --------------------------------------- President, Chief Executive Officer and
Robert G. Dutcher Director (principal executive officer)
/s/ RUSSEL E. CARLSON
- --------------------------------------- Chief Financial Officer (principal
Russel E. Carlson financial and accounting officer)
Dean Belbas* Director
Seymour J. Mansfield* Director
Demetre M. Nicoloff, M.D.* Director
Ann M. Possis* Director
Joe A. Walters* Director
Donald C. Wegmiller* Director
* /s/ ROBERT G. DUTCHER
- --------------------------------------
By Robert G. Dutcher,
ATTORNEY-IN-FACT
II-3
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIAL PAGE
NUMBER DESCRIPTION NUMBER
- ----------- -------------------------------------------------------------------------------------------- ---------------
<S> <C> <C>
1 Underwriting Agreement
</TABLE>
<PAGE>
1,910,000 Shares
POSSIS MEDICAL, INC.
Common Stock
Par Value $.40 Per Share
UNDERWRITING AGREEMENT
_________, 1995
Dain Bosworth Incorporated
John G. Kinnard and Company, Incorporated
As Representatives of the several Underwriters
c/o Dain Bosworth Incorporated
Dain Bosworth Plaza
60 South Sixth Street
Minneapolis, Minnesota 55402
Ladies and Gentlemen:
Possis Medical, Inc., a Minnesota corporation (the "Company"), and the
shareholders of the Company named in Schedule B hereto (the "Selling
Shareholders") propose, subject to the terms and conditions stated herein, to
issue and sell, or to sell, as the case may be, to the several Underwriters
named in Schedule A hereto (the "Underwriters"), for which you are acting as
representatives (the "Representatives"), an aggregate of 1,910,000 shares (the
"Firm Shares") of Common Stock, par value $.40 per share, of the Company (the
"Common Stock"), including 1,750,000 shares to be sold by the Company and
160,000 shares to be sold by the Selling Shareholders. The Company also
proposes, subject to the terms and conditions stated herein, to issue and sell
to the Underwriters, at their election, up to an aggregate of 286,500 shares of
Common Stock (the "Option Shares"). The Firm Shares and the Option Shares are
herein collectively called the "Shares".
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (File No. 33-62009) and a
related preliminary prospectus for the registration of the Shares under the
Securities Act of 1933, as amended (the "Act"). The registration statement, as
amended at the time it was declared effective, including the information (if
any) deemed to be part thereof pursuant to Rule 430A under the Act and all
documents incorporated by reference in the prospectus contained therein at such
time is herein referred to as the "Registration Statement". The form of
prospectus first filed by the Company with the Commission pursuant to Rules
424(b) and 430A under the Act is referred to herein as the "Prospectus". Each
preliminary prospectus included in the Registration Statement prior to the time
it becomes effective or filed with the Commission pursuant to Rule 424(a) under
the Act is referred to herein as a "Preliminary Prospectus". Any reference
herein to any Preliminary Prospectus or the Prospectus shall be deemed to refer
to and include the documents incorporated by reference therein pursuant to Item
12 of Form S 3 under the Act, as of the date of such Preliminary Prospectus or
Prospectus, as the case may be; any reference to any amendment or supplement to
any Preliminary Prospectus or Prospectus shall be deemed to refer to and include
any documents filed after the date of such Preliminary Prospectus or Prospectus,
as the case may be, under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and incorporated by reference in such Preliminary Prospectus or
Prospectus, as the case may be; and any reference to any amendment to the
Registration Statement shall be deemed to refer to and include any annual report
of the Company filed pursuant to Section 13(a) or 15(d) of the
<PAGE>
Exchange Act after the effective date of the Registration Statement that is
incorporated by reference in the Registration Statement. Copies of the
Registration Statement, including all exhibits and schedules thereto and any
documents incorporated by reference, any amendments thereto and all Preliminary
Prospectuses have been delivered to you.
The Company and the Selling Shareholders hereby confirm their respective
agreements with respect to the purchase of the Shares by the Underwriters as
follows:
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
(a) The Company represents and warrants to, and agrees with,
each of the Underwriters that:
(i) The Registration Statement has been declared
effective under the Act, and no post-effective amendment to the
Registration Statement has been filed as of the date of this
Agreement. No stop order suspending the effectiveness of the
Registration Statement has been issued and no proceeding for that
purpose has been instituted or threatened by the Commission.
(ii) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission, and
each Preliminary Prospectus, at the time of filing thereof,
conformed in all material respects to the requirements of the Act
and the rules and regulations of the Commission promulgated
thereunder, and did not contain an untrue statement of a material
fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading;
provided, however, the Company makes no representation or
warranty as to information contained in or omitted in reliance
upon, and in conformity with, written information furnished to
the Company by or on behalf of any Underwriter through the
Representatives expressly for use in the preparation thereof.
The documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as
the case may be, conformed in all material respects to the
requirements of the Exchange Act and the rules and regulations of
the Commission thereunder, and none of such documents contained
an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make
the statements therein not misleading; and any further documents
so filed and incorporated by reference in the Prospectus, when
such documents become effective or are filed with Commission, as
the case may be, will conform in all material respects to the
requirements of the Exchange Act and the rules and regulations of
the Commission thereunder and will not contain an untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading.
(iii) The Registration Statement conforms, and the
Prospectus and any amendments or supplements thereto will
conform, in all material respects to the requirements of the Act
and the rules and regulations thereunder. Neither the
Registration Statement nor any amendment thereto, and neither the
Prospectus nor any supplement thereto, contains or will contain,
as the case may be, any untrue statement of a material fact or
omits or will omit to state any material fact required to be
stated therein or necessary to make the statements therein, in
light of the circumstances under
- 2 -
<PAGE>
which they were made, not misleading; provided, however, that the
Company makes no representation or warranty as to information
contained in or omitted from the Registration Statement or the
Prospectus, or any such amendment or supplement, in reliance
upon, and in conformity with, written information furnished to
the Company by or on behalf of any Underwriter through the
Representatives, expressly for use in the preparation thereof.
(iv) The Company has been duly organized, is validly
existing as a corporation in good standing under the laws of the
state of Minnesota, has the corporate power and authority to own
or lease its properties and conduct its business as described in
the Prospectus, and is duly qualified to transact business in all
jurisdictions in which the conduct of its business or its
ownership or leasing of property requires such qualification and
the failure so to qualify would have a material adverse effect on
the business or condition, financial or otherwise, of the Company
and its subsidiaries, taken as a whole.
(v) Each subsidiary of the Company has been duly
incorporated, is validly existing as a corporation in good
standing under the laws of the jurisdiction of its incorporation,
has the corporate power and authority to own or lease it
properties and conduct its business as described in the
Prospectus, and is duly qualified to transact business in all
jurisdictions in which the conduct of its business or its
ownership or leasing of property requires such qualification and
the failure so to qualify would have a material adverse effect on
the business or condition, financial or otherwise, of the Company
and its subsidiaries, taken as a whole. All outstanding shares
of capital stock of each of the subsidiaries of the Company have
been duly authorized and validly issued, are fully paid and non-
assessable, and are owned, directly or indirectly, by the Company
free and clear of all liens, encumbrances and security interests.
No options, warrants or other rights to purchase, agreements or
other obligations to issue, or other rights to convert any
obligations into, shares of capital stock or ownership interests
in any of the subsidiaries of the Company are outstanding.
(vi) The outstanding shares of capital stock of the
Company have been duly authorized and validly issued and are
fully paid and nonassessable. All offers and sales by the
Company of outstanding shares of capital stock and other
securities of the Company, prior to the date hereof, were made in
compliance with the Act and all applicable state securities or
blue sky laws. The Shares to be issued and sold by the Company
to the Underwriters pursuant to this Agreement have been duly
authorized and, when issued and paid for as contemplated herein,
will be validly issued, fully paid and nonassessable. There are
no preemptive rights or other rights to subscribe for or to
purchase, or any restriction upon the voting or transfer of, any
shares of capital stock of the Company pursuant to the Company's
Articles of Incorporation, Bylaws or any agreement or other
instrument to which the Company is a party or by which the
Company is bound. Neither the filing of the Registration
Statement nor the offering or the sale of the Shares as
contemplated by this Agreement gives rise to any rights for, or
relating to, the registration of any shares of capital stock or
other securities of the Company, except such rights which have
been validly waived or satisfied. Except as described in the
Prospectus, there are no outstanding options, warrants,
agreements, contracts or other rights to purchase or acquire from
the Company any shares of its capital stock. The Company has the
authorized and outstanding capital stock as set forth under the
heading "Capitalization" in the Prospectus. The outstanding
capital
- 3 -
<PAGE>
stock of the Company, including the Shares to be sold by the
Selling Shareholders, conforms, and the Shares to be issued by
the Company and sold to the Underwriters will conform, to the
description thereof contained in the Prospectus.
(vii) The financial statements, together with the related
notes and schedules as set forth or incorporated by reference in
the Registration Statement and Prospectus, present fairly the
consolidated financial position, results of operations and
changes in financial position of the Company and its subsidiaries
on the basis stated in the Registration Statement at the
indicated dates and for the indicated periods. Such financial
statements have been prepared in accordance with generally
accepted accounting principles consistently applied throughout
the periods involved, and all adjustments necessary for a fair
presentation of results for such periods have been made, except
as otherwise stated therein. The summary and selected financial
and statistical data included in the Registration Statement
present fairly the information shown therein on the basis stated
in the Registration Statement and have been compiled on a basis
consistent with the financial statements presented therein.
(viii) There is no action or proceeding pending or, to the
knowledge of the Company, threatened or contemplated against the
Company or any of its subsidiaries before any court or
administrative or regulatory agency which, if determined
adversely to the Company or any of its subsidiaries, would,
individually or in the aggregate, result in a material adverse
change in the business or condition (financial or otherwise),
results of operations, shareholders equity or prospects of the
Company and its subsidiaries, taken as a whole, except as set
forth in the Registration Statement.
(ix) The Company has good and marketable title to all
properties and assets reflected as owned in the financial
statements hereinabove described (or as described as owned in the
Prospectus), in each case free and clear of all liens,
encumbrances and defects, except such as are described in the
Prospectus or do not substantially affect the value of such
properties and assets and do not materially interfere with the
use made and proposed to be made of such properties and assets by
the Company and its subsidiaries; and any real property and
buildings held under lease by the Company and its subsidiaries
are held by them under valid, subsisting and enforceable leases
with such exceptions as are not material and do not interfere
with the use made and proposed to be made of such property and
buildings by the Company and its subsidiaries.
(x) Since the respective dates as of which information
is given in the Registration Statement, as it may be amended or
supplemented, (A) there has not been any material adverse change,
or any development involving a prospective material adverse
change, in or affecting the condition, financial or otherwise, of
the Company and its subsidiaries, taken as a whole, or the
business affairs, management, financial position, shareholders
equity or results of operations of the Company and its
subsidiaries, taken as a whole, whether or not occurring in the
ordinary course of business, (B) there has not been any
transaction not in the ordinary course of business entered into
by the Company or any of its subsidiaries which is material to
the Company and its subsidiaries, taken as a whole, other than
transactions described or contemplated in the Registration
Statement, (C) the Company and its subsidiaries have not incurred
any material liabilities or obligations, which are not in the
ordinary course of business or which could result in a material
reduction in the future earnings of the Company and its
subsidiaries, (D) the Company and its subsidiaries have not
sustained
- 4 -
<PAGE>
any material loss or interference with their respective
businesses or properties from fire, flood, windstorm, accident or
other calamity, whether or not covered by insurance, (E) there
has not been any change in the capital stock of the Company
(other than upon the exercise of options and warrants described
in the Registration Statement), or any material increase in the
short-term or long-term debt (including capitalized lease
obligations) of the Company and its subsidiaries, taken as a
whole, (F) there has not been any declaration or payment of any
dividends or any distributions of any kind with respect to the
capital stock of the Company, other than any dividends or
distributions described or contemplated in the Registration
Statement, or (G) there has not been any issuance of warrants,
options, convertible securities or other rights to purchase or
acquire capital stock of the Company.
(xi) Neither the Company nor any of its subsidiaries is
in violation of, or in default under, its Articles of
Incorporation or Bylaws, or any statute, or any rule, regulation,
order, judgment, decree or authorization of any court or
governmental or administrative agency or body having jurisdiction
over the Company or any of its subsidiaries or any of their
properties, or any indenture, mortgage, deed of trust, loan
agreement, lease, franchise, license or other agreement or
instrument to which the Company or any of its subsidiaries is a
party or by which it or any of them are bound or to which any
property or assets of the Company or any of its subsidiaries is
subject, which violation or default would have a material adverse
effect on the business, condition (financial or otherwise),
results of operations, shareholders' equity or prospects of the
Company and its subsidiaries, taken as a whole.
(xii) The issuance and sale of the Shares by the Company
and the compliance by the Company with all of the provisions of
this Agreement and the consummation of the transactions
contemplated herein will not violate any provision of the
Articles of Incorporation or Bylaws of the Company or any of its
subsidiaries or any statute or any order, judgment, decree, rule,
regulation or authorization of any court or governmental or
administrative agency or body having jurisdiction over the
Company or any of its subsidiaries or any of their properties,
and will not conflict with, result in a breach or violation of,
or constitute, either by itself or upon notice or passage of time
or both, a default under any indenture, mortgage, deed of trust,
loan agreement, lease, franchise, license or other agreement or
instrument to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries is bound
or to which any property or assets of the Company or any of its
subsidiaries is subject. No approval, consent, order,
authorization, designation, declaration or filing by or with any
court or governmental agency or body is required for the
execution and delivery by the Company of this Agreement and the
consummation of the transactions herein contemplated, except as
may be required under the Act or any state securities or blue sky
laws.
(xiii) The Company and each of its subsidiaries holds and
is operating in compliance with all licenses, approvals,
certificates and permits from governmental and regulatory
authorities, foreign and domestic, which are necessary to the
conduct of its business as described in the Prospectus.
(xiv) Deloitte and Touche LLP, which has certified certain
of the financial statements filed with the Commission as part of
the Registration Statement, are independent public accountants as
required by the Act and the rules and regulations thereunder.
- 5 -
<PAGE>
(xv) The Company has not taken and will not take,
directly or indirectly, any action designed to, or which has
constituted, or which might reasonably be expected to cause or
result in, stabilization or manipulation of the price of the
Common Stock.
(xvi) The Shares have been approved for designation upon
notice of issuance on the Nasdaq National Market under the symbol
"POSS."
(xvii) The Company has obtained and delivered to the
Representatives written agreements, in form and substance
satisfactory to the Representatives, of each of its directors and
executive officers and the Possis Marital Trust that no offer,
sale, assignment, transfer, encumbrance, contract to sell, grant
of an option to purchase or other disposition of any Common Stock
or other capital stock of the Company will be made for a period
of 90 days after the date of the Prospectus, directly or
indirectly, by such holder otherwise than hereunder or with the
prior written consent of the Representatives and that for an
additional 90-day period after such 90-day period, no offer,
sale, assignment, transfer, encumbrance, contract to sell, grant
of an option to purchase or other disposition of any Common Stock
or other capital stock of the Company will be made by such holder
unless such holder shall have first offered the Representatives
in writing the opportunity to effect any such transaction and the
Representatives shall not have notified the holder thereof within
five business days of the Representatives receipt of such notice
of their desire to attempt to effect such transaction on behalf
of the holder.
(xviii) The Company has not distributed and will not
distribute any prospectus or other offering material in
connection with the offering and sale of the Shares other than
any Preliminary Prospectus or the Prospectus or other materials
permitted by the Act to be distributed by the Company.
(xix) The Company is in compliance with all provisions of
Florida Statutes Section 517.075 (Chapter 92-198, laws of
Florida). The Company does not do any business, directly or
indirectly, with the government of Cuba or with any person or
entity located in Cuba.
(xx) The Company and its subsidiaries have filed all
federal, state, local and foreign tax returns or reports required
to be filed, and have paid in full all taxes indicated by said
returns or reports and all assessments received by it or any of
them to the extent that such taxes have become due and payable,
except where the Company and its subsidiaries are contesting in
good faith such taxes and assessments.
(xxi) The Company and each of its subsidiaries owns or
licenses all patents, patent applications, trademarks, service
marks, tradenames, trademark registrations, service mark
registrations, copyrights, licenses, inventions, trade secrets
and other similar rights (the "Proprietary Rights") necessary for
the conduct of its business as described in the Prospectus. The
Company has no knowledge of any infringement by it or its
subsidiaries of or conflict with any proprietary rights of
others, and neither the Company nor any of its subsidiaries has
given or received any notice or claim of conflict with the
asserted proprietary rights of others with respect to any of the
foregoing. No action, suit, arbitration or legal, administrative
or other proceeding, or domestic or foreign governmental
investigation is pending, or to the best of the Company's
knowledge, threatened, which involves any Proprietary Rights.
- 6 -
<PAGE>
The Company is not subject to any judgment, order, writ,
injunction or decree of any court or any federal, state, local,
foreign or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, or any
arbitrator, or has entered into or is a party to any contract
which restricts or impairs the use of any such Propriety Rights.
To the best of the Company's knowledge, no Proprietary Rights
used by the Company and no services or products sold by the
Company conflict with or infringe upon any proprietary rights
available to any third party. The Company has not entered into
any consent, indemnification, forbearance to sue or settlement
agreement with respect to Proprietary Rights other than in the
ordinary course of business. No claims have been asserted by any
person with respect to the validity of or the Company's ownership
or right to use the Proprietary Rights and, to the best knowledge
of the Company, there is no reasonable basis for any such claim
to be successful. The Proprietary Rights are valid and
enforceable and no registration relating thereto has lapsed,
expired or been abandoned or cancelled or is the subject of
cancellation or other adversarial proceedings, and all
applications therefore are pending and are in good standing. The
Company has complied with its respective contractual obligations
relating to the protection of the Proprietary Rights used
pursuant to licenses. To the best knowledge of the Company, no
person is infringing on or violating the Proprietary Rights owned
or used by the Company.
(xxii) The Company is not, and upon completion of the sale
of Shares contemplated hereby will not be, required to register
as an "investment company" under the Investment Company Act of
1940, as amended.
(xxiii) The conditions for the use of Form S-3, as set
forth in the General Instructions thereto, have been satisfied.
(xxiv) With respect to the requirements of the federal
Food, Drug and Cosmetic Act and the regulations of the federal
Food and Drug Administration, the Company holds all material
certificates, permits, authorizations, consents and orders
necessary for the conduct of its present business as described in
the Prospectus.
(xxv) Except as described in the Prospectus, there are no
rulemaking or similar proceedings before the United States Food
and Drug Administration or comparable federal, state, local or
foreign government bodies which involve or, to the best knowledge
of the Company, affect the Company, which, if the subject of an
action unfavorable to the Company, could involve a prospective
material adverse change in or effect on the business, condition
(financial or otherwise), results ofoperations, shareholders'
equity or prospects of the Company.
(xxvi) The Company maintains insurance of the type and in
the amounts generally deemed adequate for its business and
consistent with insurance coverage maintained by similar
companies and businesses, including without limitation, product
liability insurance and insurance covering all real and personal
property owned or leased by it, all of which is in full force and
effect.
(b) Any certificate signed by any officer of the Company and
delivered to the Representatives or counsel to the Underwriters
hereunder shall be deemed to be a representation and warranty of the
Company to each Underwriter as to the matters covered thereby.
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2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLING SHAREHOLDERS.
(a) Each Selling Shareholder severally represents and warrants
to, and covenants and agrees with, each of the Underwriters and the
Company that:
(i) Such Selling Shareholder has duly executed and
delivered a Power of Attorney (the "Power of Attorney"),
appointing Robert G. Dutcher and Russel E. Carlson, and each of
them, as attorney-in-fact (the "Attorneys-In-Fact") with full
power and authority to execute and deliver this Agreement on
behalf of such Selling Shareholder, to authorize the delivery of
the Shares to be sold by the Selling Shareholder hereunder, and
otherwise to act on behalf of such Selling Shareholder in
connection with the transactions contemplated by this Agreement.
(ii) Such Selling Shareholder has duly executed and
delivered a Custody Agreement (the "Custody Agreement") with
Norwest Bank Minnesota, N.A., as Custodian, pursuant to which
certificates in negotiable form for the Shares to be sold by such
Selling Shareholder hereunder have been placed in custody for
delivery under this Agreement.
(iii) Such Selling Shareholder has full right, power and
authority to enter into this Agreement, the Power of Attorney and
the Custody Agreement, and to sell, assign, transfer and deliver
the Shares to be sold by such Selling Shareholder hereunder; and
all consents, approvals, authorizations and orders necessary for
the execution and delivery by such Selling Shareholder of this
Agreement, the Power of Attorney and the Custody Agreement, and
for the sale and delivery of the Shares to be sold by such
Selling Shareholder hereunder, have been obtained, except such as
may be required by any state securities or blue sky laws.
(iv) Such Selling Shareholder has, and at the Closing
Date will have good and valid title to the Shares to be sold by
such Selling Shareholder hereunder, free of any liens,
encumbrances, security interests, equities or claims whatsoever;
and upon delivery of and payment for such Shares pursuant to this
Agreement, good and valid title thereto, free of any liens,
encumbrances, security interests, equities or claims whatsoever,
will be transferred to the several Underwriters.
(v) The consummation by such Selling Shareholder of the
transactionsherein contemplated and the fulfillment by such
Selling Shareholder of the terms hereof will not conflict with or
result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any will, mortgage,
deed of trust, loan agreement or other agreement, instrument or
obligation to which such Selling Shareholder is a party or to
which any of the property or assets of such Selling Shareholder
is subject, except for such agreements, instruments or
obligations for which consents have been obtained, nor will such
actions result in any violations of the provisions of the charter
or by-laws if such Selling Shareholder is a corporation, the
partnership agreement, certificate or articles if the Selling
Shareholder is a partnership, or any statute, rule, regulation or
order applicable to such Selling Shareholder of any court or of
any regulatory body or administrative agency or other
governmental body having jurisdiction over such Selling
Shareholder.
(vi) Such Selling Shareholder has not taken and will not
take, directly or indirectly, any action designed to, or which
has constituted, or which might reasonably
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be expected to cause or result in, stabilization or manipulation
of the price of the Common Stock.
(vii) To the extent that any statements or omissions made
in theRegistration Statement, any Preliminary Prospectus, the
Prospectus or any amendment or supplement thereto are made in
reliance upon and in conformity with written information with
respect to such Selling Shareholder furnished to the Company by
such Selling Shareholder expressly for use therein, such
Preliminary Prospectus and the Registration Statement did not,
and the Prospectus and any further amendments or supplements to
the Registration Statement and the Prospectus will not, when they
become effective or are filed with the Commission, as the case
may be, contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or
necessary to make the statements therein not misleading.
(viii) Such Selling Shareholder will not sell, offer to
sell, transfer, assign or otherwise dispose of any Common Stock
or other capital stock of the Company, directly or indirectly,
for a period of 90 days after the date of the Prospectus,
otherwise than hereunder or with the written consent of the
Representative, and for an additional 90-day period after such
90-day period, no offer, sale, assignment, transfer,
encumbrance, contract to sell, grant of an option to purchase or
other disposition of any Common Stock or other capital stock of
the Company will be made by such Selling Shareholder unless such
Selling Shareholder shall have first offered the Representative
in writing the opportunity to effect any such transaction and the
Representative shall not have notified the Selling Shareholder
thereof within five business days of the Representative receipt
of such notice of their desire to attempt to effect such
transaction on behalf of the Selling Shareholder.
(ix) Such Selling Shareholder has reviewed the
Registration Statement and the Prospectus and to the best
knowledge of such Selling Shareholder the Registration Statement
or the Prospectus (or any amendment or supplement thereto) as it
relates to such Selling Shareholder does not contain any untrue
statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements
therein regarding such Selling Shareholder not misleading.
(b) In order to document the Underwriters compliance with the
reporting and withholding provisions of the Internal Revenue Code of
1986, as amended, with respect to the transactions herein
contemplated, each of the Selling Shareholders agrees to deliver to
you prior to or at the Closing Date a properly completed and executed
United States Treasury Department Form W-9 (or other applicable form
or statement specified by Treasury Department regulations in lieu
thereof).
(c) Each of the Selling Shareholders specifically agrees that
the Shares represented by the certificates held in custody for such
Selling Shareholder under the Custody Agreement are subject to the
interests of the Underwriters hereunder, and that the arrangements
made by such Selling Shareholder for such custody and the appointment
by such Selling Shareholder of the Attorneys-in-Fact by the Power of
Attorney, are to that extent irrevocable. Each of the Selling
Shareholders specifically agrees that the obligations of the Selling
Shareholders hereunder shall not be terminated by operation of law,
whether by the death or incapacity of any individual Selling
Shareholder or, in the case of an estate or trust, by the death or
incapacity of any executor or trustee or the termination of such
estate or trust, or in
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the case of a corporation or partnership, by the dissolution of such
corporation or partnership, or by the occurrence of any other event.
If any individual Selling Shareholder or any such executor or trustee
should die or become incapacitated, or if any such estate or trust
should be terminated, or if any such corporation or partnership should
be dissolved, or if any other such event should occur before the
delivery of the Shares hereunder, certificates representing the Shares
shall be delivered by or on behalf of the Selling Shareholders in
accordance with the terms and conditions of this Agreement and of the
Custody Agreement, and actions taken by the Attorneys-in-Fact pursuant
to the Powers of Attorney shall be as valid as if such death,
incapacity, termination, dissolution or other event had not occurred,
regardless of whether or not the Custodian, the Attorneys in Fact, or
any of them, shall have received notice of such death, incapacity,
termination, dissolution or other event.
(d) Any certificate signed by or on behalf of any Selling
Shareholder and delivered to the Representatives or to counsel to the
Underwriters hereunder shall be deemed to be a representation and
warranty of such Selling Shareholder to each Underwriter as to the
matters covered thereby.
3. PURCHASE, SALE AND DELIVERY OF SHARES. On the basis of the
representations, warranties and covenants contained herein, and subject to
the terms and conditions herein set forth, the Company and each Selling
Shareholder agrees, severally and not jointly, to sell to each Underwriter
and each Underwriter agrees, severally and not jointly, to purchase from
the Company and each Selling Shareholder, at a price of $_____ per share,
the number of Firm Shares (to be adjusted by you to eliminate fractional
shares) determined by multiplying the aggregate number of Firm Shares to be
sold by the Company and each of the Selling Shareholders, as set forth
opposite their respective names in Schedule B hereto, by a fraction, the
numerator of which is the aggregate number of Firm Shares to be purchased
by such Underwriter as set forth opposite the name of such Underwriter in
Schedule A hereto and the denominator of which is the aggregate number of
Firm Shares to be purchased by all the Underwriters from the Company and
the Selling Shareholders hereunder.
In addition, on the basis of the representations, warranties and
covenants herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants to the several Underwriters an option
to purchase at their election up to 286,500 Option Shares at the same price
per share as set forth for the Firm Shares in the paragraph above, for the
sole purpose of covering overallotments in the sale of the Firm Shares.
The option granted hereby may be exercised in whole or in part, but only
once, and at any time upon written notice given within 30 days after the
date of this Agreement, by you, as Representatives of the several
Underwriters, to the Company, the Attorneys-in-Fact and the Custodian
setting forth the number of Option Shares as to which the several
Underwriters are exercising the option and the time and date at which
certificates are to be delivered. If any Option Shares are purchased, each
Underwriter agrees, severally and not jointly, to purchase that portion of
the number of Option Shares as to which such election shall have been
exercised (subject to adjustment to eliminate fractional shares) determined
by multiplying such number of Option Shares by a fraction the numerator of
which is the maximum number of Option Shares which such Underwriter is
entitled to purchase as set forth opposite the name of such Underwriter in
Schedule A hereto and the denominator of which is the maximum number of
Option Shares which all of the Underwriters are entitled to purchase
hereunder. The time and date at which certificates for Option Shares are
to be delivered shall be determined by the Representatives but shall not be
earlier than two or later than ten full business days after the exercise of
such option, and shall not in any event be prior to the Closing Date. If
the date of exercise of the option is three or more full days before the
Closing Date, the notice of exercise shall set the Closing Date as the
Option Closing Date.
Certificates in definitive form for the Shares to be purchased by each
Underwriter hereunder, and in such denominations and registered in such
names as the Representatives may request upon at least forty-eight hours
prior notice to the Company, shall be delivered by or on behalf of the
Company and each Selling
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Shareholder to you for the account of such Underwriter at such time and
place as shall hereafter be designated by the Representatives, against
payment by such Underwriter or on its behalf of the purchase price therefor
by wire transfer of immediately available funds to the Company and to the
Custodian in accordance with instructions received in writing from the
Company at least two business days prior to Closing. The time and date of
such delivery and payment shall be, with respect to the Firm Shares, 8:30
a.m. Minneapolis time, at the offices of Dorsey & Whitney, P.L.L.P., on
________________, 1995, or such other time and date as you and the Company
may agree upon in writing, such time and date being herein referred to as
the "Closing Date," and, with respect to the Option Shares, at the time and
on the date specified by you in the written notice given by you of the
Underwriters election to purchase the Option Shares, or such other time
and date as you and the Company may agree upon in writing, such time and
date being referred to herein as the Option Closing Date. Such
certificates will be made available for checking and packaging at least
twenty four hours prior to the Closing Date or the Option Closing Date, as
the case may be, at a location as may be designated by you.
4. OFFERING BY UNDERWRITERS. It is understood that the several
Underwriters propose to make a public offering of the Firm Shares as soon
as the Representatives deem it advisable to do so. The Firm Shares are to
be initially offered to the public at the Price to Public set forth in the
Prospectus. The Representatives may from time to time thereafter change
the public offering price and other selling terms. To the extent, if at
all, that any Option Shares are purchased pursuant to Section 3 hereof, the
Underwriters will offer such Option Shares to the public on the foregoing
terms.
It is understood that 100,000 Firm Shares will initially be reserved
by the several Underwriters for offer and sale upon the terms and
conditions set forth in the Prospectus to employees and persons having
business relationships with the Company and its subsidiaries who have
heretofore delivered to you offers or indications of interest to purchase
Firm Shares in form satisfactory to you, and that any allocation of such
Firm Shares among such persons will be made in accordance with timely
directions received by you from the Company, provided that under no
circumstances will you or any Underwriter be liable to the Company or any
such person for any action taken or omitted in good faith in connection
with such offering to employees and persons having business relationships
with the Company and its subsidiaries. It is further understood that any
of such Firm Shares which are not purchased by such persons will be offered
by the Underwriters to the public upon the terms and conditions set forth
in the Prospectus.
5. COVENANTS OF THE COMPANY. The Company covenants and agrees with
the several Underwriters that:
(a) The Company will prepare and timely file with the Commission
under Rule 424(b) under the Act a Prospectus containing information
previously omitted at the time of effectiveness of the Registration
Statement in reliance on Rule 430A under the Act, and willnot file any
amendment to the Registration Statement or supplement to the
Prospectus or any document incorporated by reference in the Prospectus
of which the Representatives shall not previously have been advised
and furnished with a copy and as to which the Representatives shall
have objected in writing promptly after reasonable notice thereof or
which is not in compliance with the Act or the rules and regulations
thereunder. The Company will file promptly all reports and any
definitive proxy or information statements required to be filed by the
Company with the Commission pursuant to Section 13(a), 13(c), 14 or
15(d) of 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.
(b) The Company will advise the Representatives promptly of any
request of the Commission for amendment of the Registration Statement
or for any supplement to the Prospectus or for any additional
information, or of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the use
of the Prospectus, of
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<PAGE>
the suspension of the qualification of the Shares for offering or sale
in any jurisdiction, or of the institution or threatening of any
proceedings for that purpose, and the Company will use its best
efforts to prevent the issuance of any such stop order preventing or
suspending the use of the Prospectus or suspending such qualification
and to obtain as soon as possible the lifting thereof, if issued.
(c) The Company will endeavor to qualify the Shares for sale
under the securities laws of such jurisdictions as the Representatives
may reasonably have designated in writing and will, or will cause
counsel to, make such applications, file such documents, and furnish
such information as may be reasonably requested by the
Representatives, provided that the Company shall not be required to
qualify as a foreign corporation or to file a general consent to
service of process in any jurisdiction where it is not now so
qualified or required to file such a consent. The Company will, from
time to time, prepare and file such statements, reports and other
documents as are or may be required to continue such qualifications in
effect for so long a period as the Representatives may reasonably
request for distribution of the Shares.
(d) The Company will furnish the Underwriters with as many
copies of any Preliminary Prospectus as the Representatives may
reasonably request and, during the period when delivery of a
prospectus is required under the Act, the Company will furnish the
Underwriters with as many copies of the Prospectus in final form, or
as thereafter amended or supplemented, as the Representatives may,
from time to time, reasonably request. The Company will deliver to
the Representatives, at or before the Closing Date, one complete copy
of the Registration Statement and all amendments thereto, including
copies of the signature pages and all exhibits filed therewith, and
will deliver to the Representatives such number of copies of the
Registration Statement, without exhibits, and of all amendments
thereto, as the Representatives may reasonably request.
(e) If, during the period in which a prospectus is required by
law to be delivered by an Underwriter or dealer, any event shall occur
as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements therein,
in light of the circumstances existing at the time the Prospectus is
delivered to a purchaser, not misleading, or if for any other reason
it shall be necessary at any time to amend or supplement the
Prospectus to comply with any law, the Company promptly will prepare
and file with the Commission anappropriate amendment to the
Registration Statement or supplement to the Prospectus so that the
Prospectus as so amended or supplemented will not include an untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements therein in light of the
circumstances existing when it is so delivered, not misleading, or so
that the Prospectus will comply with law. In case any Underwriter is
required to deliver a prospectus in connection with sales of any
Shares at any time nine months or more after the effective date of the
Registration Statement, upon the request of the Representatives but at
the expense of such Underwriter, the Company will prepare and deliver
to such Underwriter as many copies as the Representatives may request
of an amended or supplemented Prospectus complying with Section
10(a)(3) of the Act.
(f) The Company will make generally available to its security
holders, as soon as it is practicable to do so, but in any event not
later than 18 months after the effective date of the Registration
Statement, an earnings statement (which need not be audited) in
reasonable detail, covering a period of at least 12 consecutive months
beginning after the effective date of the Registration Statement,
which earnings statement shall satisfy the requirements of Section
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11(a) of the Act and Rule 158 thereunder and will advise you in
writing when such statement has been so made available.
(g) The Company will, for such period up to five years from the
Closing Date, deliver to the Representatives copies of its annual
report and copies of all other documents, reports and information
furnished by the Company to its security holders or filed with any
securities exchange pursuant to the requirements of such exchange or
with the Commission pursuant to the Act or the Exchange Act. The
Company will deliver to the Representatives similar reports with
respect to significant subsidiaries, as that term is defined in the
rules and regulations under the Act, which are not consolidated in the
Company s financial statements.
(h) No offering, sale or other disposition of any Common Stock
or other capital stock of the Company, or warrants, options,
convertible securities or other rights to acquire such Common Stock or
other capital stock (other than pursuant to employee stock option
plans, outstanding options or on the conversion of convertible
securities outstanding on the date of this Agreement) will be made for
a period of 90 days after the date of this Agreement, directly or
indirectly, by the Company otherwise than hereunder or with the prior
written consent of the Representatives.
(i) The Company will apply the net proceeds from the sale of the
Shares to be sold by it hereunder substantially in accordance with the
purposes set forth under "Use of Proceeds" in the Prospectus.
(j) The Company will use its best efforts to maintain the
designation of the Common Stock on the Nasdaq National Market.
(k) The Company will file with the Commission such reports on
Form SR as may be required pursuant to Rule 463 under the Act.
6. COSTS AND EXPENSES. The Company will pay (directly or by
reimbursement) all costs, expenses and fees incident to the performance of the
obligations of the Company and the Selling Shareholders under this Agreement,
including, without limiting the generality of the foregoing, the following:
accounting fees of the Company; the fees and disbursements of counsel for the
Company; the cost of preparing, printing and filing of the Registration
Statement, Preliminary Prospectuses and the Prospectus and any amendments and
supplements thereto and the printing, mailing and delivery to the Underwriters
and dealers of copies thereof and of this Agreement, the Agreement Among
Underwriters, any Selected Dealers Agreement, the Underwriters Selling
Memorandum, the Invitation Letter, the Power of Attorney, the Blue Sky
Memorandum and any supplements or amendments thereto (excluding, except as
provided below, fees and expenses of counsel to the Underwriters); the filing
fees of the Commission; the filing fees and expenses (including disbursements of
counsel for the Underwriters) incident to securing any required review by the
NASD of the terms of the sale of the Shares; listing fees, if any, transfer
taxes and the expenses, including the fees and disbursements of counsel for the
Underwriters incurred in connection with the qualification of the Shares under
state securities or Blue Sky laws; the fees and expenses incurred in connection
with the designation of the Shares on the Nasdaq National Market; the costs of
preparing stock certificates; the costs and fees of any registrar or transfer
agent and all other costs and expenses incident to the performance of its
obligations hereunder which are not otherwise specifically provided for in this
Section 6. In addition, the Company will pay all travel and lodging expenses
incurred by management of the Company in connection with any informational "road
show" meetings held in connection with the offering and will also pay for the
preparation of all materials used in connection with such meetings. The Selling
Shareholders will pay all underwriting discounts and commissions relating to the
Shares to be sold by the Selling Shareholders and the fees and expenses of any
separate counsel retained by them in connection with the transactions
contemplated hereby. The Company shall not, however, be required to pay for any
of the
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Underwriters' expenses (other than those out of pocket expenses related to
qualification of the Shares under state securities or Blue Sky laws and those
incident to securing any required review by the NASD of the terms of the sale of
the shares) except that, if this Agreement shall not be consummated because the
conditions in Section 7 hereof are not satisfied, or because this Agreement is
terminated by the Representatives pursuant to Section 11(b) hereof, or by reason
of any failure, refusal or inability on the part of the Company or the Selling
Shareholders to perform any undertaking or satisfy any condition of this
Agreement or to comply with any of the terms hereof on their respective parts to
be performed, unless such failure to satisfy said condition or to comply with
said terms shall be due to the default or omission of any Underwriter, then the
Company and the Selling Shareholders shall promptly upon request by the
Representatives reimburse the several Underwriters for all out-of-pocket
accountable expenses, including fees and disbursements of counsel, incurred in
connection with investigating, marketing and proposing to market the Shares or
in contemplation of performing their obligations hereunder; but the Company and
the Selling Shareholders shall not in any event be liable to any of the several
Underwriters for damages on account of loss of anticipated profits from the sale
by them of the Shares.
7. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS. The several
obligations of the Underwriters to purchase the Firm Shares on the Closing Date
and the Option Shares, if any, on the Option Closing Date, are subject to the
condition that all representations and warranties of the Company and the Selling
Shareholders contained herein are true and correct, at and as of the Closing
Date or the Option Closing Date, as the case may be, the condition that the
Company and the Selling Shareholders shall have performed all of their
respective covenants and obligations hereunder and to the following additional
conditions:
(a) The Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed
for such filing by the rules and regulations under the Act and in
accordance with Section 4(a) hereof; no stop order suspending the
effectiveness of the Registration Statement, as amended from time to
time, or any part thereof shall have been issued and no proceedings
for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of
the Commission shall have been complied with to the reasonable
satisfaction of the Representatives.
(b) The Representatives shall have received on the Closing Date
or the Option Closing Date, as the case may be, the opinion of Dorsey
& Whitney, P.L.L.P. for the Company, dated the Closing Date or the
Option Closing Date, as the case may be, addressed to the
Underwriters, to the effect that:
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws
of the State of Minnesota, with corporate power to own or lease
its properties and conduct its business as described in the
Prospectus.
(ii) Possis Holdings, Inc. and JEI Liquidation, Inc. (the
"Covered Subsidiaries") have been duly incorporated and are
validly existing as corporations in good standing under the laws
of the state of Minnesota with corporate power to own or lease
their properties and conduct their businesses as described in the
Prospectus. The outstanding shares of capital stock of each
Covered Subsidiary has been duly authorized and validly issued,
are fully paid and nonassessable and are owned, directly or
indirectly, by the Company, free and clear of all liens,
encumbrances and security interests, other than security
interests specifically disclosed in the Prospectus. To the
knowledge of such counsel, no options, warrants or other rights
to purchase, agreements or other obligations to issue or other
rights to convert any obligations into
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<PAGE>
any shares of capital stock or ownership interests in each
Covered Subsidiary or Possis Medical Europe, B.V. are
outstanding.
(iii) The Company has authorized capital stock as
described in the Capitalization section of the Prospectus. The
outstanding shares of the Company's capital stock have been duly
authorized and validly issued and are fully paid and
nonassessable. The form of certificate for the Shares is in
proper form under the Minnesota Business Corporation Act. The
Shares to be issued and sold by the Company pursuant to this
Agreement have been duly authorized and, when issued and paid for
as contemplated herein, will be validly issued, fully paid and
nonassessable. No preemptive or, to the knowledge of such
counsel, other similar subscription rights of shareholders of the
Company, or of holders of warrants, options, convertible
securities or other rights to acquire shares of capital stock of
the Company, exist with respect to any of the Shares or the issue
and sale thereof. To the knowledge of such counsel, no rights to
register outstanding shares of the Company s capital stock, or
shares issuable upon the exercise of outstanding warrants,
options, convertible securities or other rights to acquire shares
of such capital stock, exist which have not been validly
exercised or waived with respect to the Registration Statement.
The capital stock of the Company, including the Shares, conforms
in all material respectsto the description thereof contained in
the Prospectus.
(iv) The Registration Statement has become effective
under the Act and, to the knowledge of such counsel, no stop
order proceedings with respect thereto have been instituted or
are pending or threatened by the Commission.
(v) The Registration Statement, the Prospectus and each
amendment orsupplement thereto comply as to form in all material
respects with the requirements of the Act and the rules and
regulations thereunder (except that such counsel need express no
opinion as to the financial statements and related schedules
included therein). The documents incorporated by reference in
the Prospectus or any further amendment orsupplement thereto made
by the Company prior to the Closing Date or the Option Closing
Date, as the case may be, (other than the financial statements
and related schedules therein, as to which such counsel need
express no opinion), when they became effective or were filed
with the Commission, as the case may be, complied as to form in
all material respects with the requirements of the Exchange Act,
and the rules and regulations of the Commission thereunder.
(vi) The statements (A) in the Prospectus under the
caption "Description of Capital Stock" and (B) in the
Registration Statement in Item 15 insofar as such statements
constitute a summary of matters of law, are accurate summaries
and fairly present the information called for with respect to
such matters.
(vii) Such counsel does not know of any contracts,
agreements, documents or instruments required to be filed as
exhibits to the Registration Statement, incorporated by reference
into the Prospectus, or described in the Registration Statement
or the Prospectus which are not so filed, incorporated by
reference or described as required; and insofar as any statements
in the Registration Statement or the Prospectus constitute
summaries of any contract, agreement, document or instrument to
which the Company is a party, such statements are accurate
summaries and fairly present the information called for with
respect to such matters.
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<PAGE>
(viii) Such counsel knows of no legal or governmental
proceeding, pending or threatened, before any court or
administrative body or regulatory agency, to which the Company or
any of its subsidiaries is a party or to which any of the
properties of the Company or any of its subsidiaries is subject
that are required to be described in the Registration Statement
or Prospectus and are not so described, or statutes or
regulations that are required to be described in the Registration
Statement or the Prospectus that are not so described.
(ix) The execution and delivery of this Agreement and the
consummation of the transactions herein contemplated do not and
will not conflict with or result in a violation of or default
under the charter or bylaws of the Company or either of the
Covered Subsidiaries, or under any law, rule or regulation of the
United States or the state of Minnesota or any judgment, order or
decree known to such counsel and applicable to the Company or
any of its subsidiaries, or under any lease, contract, indenture,
mortgage, loan agreement or other agreement or other instrument
or obligation known to such counsel to which the Company or any
of its subsidiaries is a party or by which the Company or any of
its subsidiaries is bound or to which any property or assets of
the Company or any of its subsidiaries is subject, except such
agreements, instruments or obligations with respect to which
valid consents or waivershave been obtained by the Company or any
of its subsidiaries.
(x) The Company has the corporate power to enter into
this Agreementand to authorize, issue and sell the Shares as
contemplated hereby. This Agreement has been duly and validly
authorized, executed and delivered by the Company.
(xi) No approval, consent, order, authorization,
designation, declaration or filing by or with any regulatory,
administrative or other governmental body is necessary in
connection with the execution and delivery of this Agreement and
the consummation of the transactions herein contemplated (other
than as may be required by state securities and blue sky laws, as
to which such counsel need express no opinion) except such as
have been obtained or made.
(xii) The statements in the Prospectus in the first
paragraph under the heading "Risk Factors -- Potential Negative
Impact of Changes in or Failure to Comply with Governmental
Regulations," and "Business -- Governmental Regulation" fairly
summarize the laws and regulations therein described.
(xiii) The Company is not, and immediately upon completion
of the sale of Shares contemplated hereby will not be, required
to register as an "investment company" under the Investment
Company Act of 1940, as amended.
Such opinion letter also shall include the following paragraph:
Such counsel has no reason to believe that (a) as of its
effective date, the Registration Statement or any further
amendment thereto made by the Company prior to the Closing Date
or the Option Closing Date, as the case may be, (other than the
financial statements and related schedules therein, as to which
such counsel need express no opinion) 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
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<PAGE>
not misleading or (b) as of its date, the Prospectus or any
further amendment or supplement thereto made by the Company prior
to the Closing Date or the Option Closing Date, as the case may
be, (other than the financial statements and related schedules
therein, as to which such counsel need express no view) contained
an untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in light
of the circumstances in which they were made, not misleading or
(c) as of the Closing Date or the Option Closing Date, as the
case may be, neither the Registration Statement or the Prospectus
of any further amendment or supplement thereto made by the
Company prior to the Closing Date or the Option Closing Date, as
the case may be, (other than the financial statements and related
schedules therein, as to which such counsel need express no view)
contains an untruestatement of a material fact or omits to state
a material fact necessary to make the statements therein, in
light of the circumstances in which they were made, not
misleading; and they do not know of any amendment to the
Registration Statement required to be filed. Further, such
counsel has no reason to believe that any documents incorporated
by reference in the Prospectus or any further amendment thereto
made by the Company prior to the Closing Date or the Option
Closing Date, asthe case may be, when such documents became
effective or were so filed, as the case may be, contained in the
case of a registration statement which became effective under the
Act, 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 (other than the
financial statements and related schedules therein, as to which
such counsel need express no view) or, in the case of other
documents whichwere filed under the Exchange Act with the
Commission, an untrue statement of amaterial fact or omitted to
state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made
when such documents were so filed, not misleading (other than the
financial statements and related schedules therein, as to which
such counsel need express no view).
(c) The Representatives shall have received on the Closing Date
or the Option Closing Date, as the case may be, the opinion of Irving
R. Colacci, Esq., General Counsel and Vice President of Legal Affairs
of the Company, dated the Closing Date or the Option Closing Date, as
the case may be, addressed to the Underwriters, to the effect that:
(i) With respect to the requirements of the federal
Food, Drug andCosmetic Act and the regulations of the federal
Food and Drug Administration, the Company holds all material
certificates, permits, authorizations, consents and orders
necessary for the conduct of its present business as described in
the Prospectus.
(d) The Representatives shall have received on the Closing Date
or the Option Closing Date, as the case may be, the opinion of Trenite
von Doorne, Counsel for the Company, dated the Closing Date or the
Option Closing Date, as the case may be, addressed to the
Underwriters, to the effect that:
(i) Possis Medical Europe, B.V. ("PMBV"), has been duly
incorporated (or formed), and is validly in existence and
operating in accordance with Netherlands' laws and directives,
with the corporate power to own and lease its properties and
conduct its business as described in the Prospectus. PMBV meets
the capital requirements under Netherlands laws, and its
outstanding shares of
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capital stock have been duly authorized and issued, are fully
paid and nonassessable and are owned directly by Possis Medical,
Inc. All financial reporting requirements and other corporate
filings required under Netherlands law have been made.
(e) The Representatives shall have received on the Closing Date,
the opinion of counsel for each of the Selling Shareholders, which
counsel shall be reasonably acceptable to the Representatives, dated
the Closing Date, addressed to the Underwriters, to the effect that:
(i) A Power of Attorney and a Custody Agreement have
been duly executed and delivered by such Selling Shareholder and
are the valid and binding agreements of such Selling Shareholder.
(ii) This Agreement has been duly authorized, executed
and delivered by or on behalf of such Selling Shareholder.
(iii) The sale of the Shares to be sold by such Selling
Shareholder hereunder and the compliance by such Selling
Shareholder with all of the provisions of this Agreement, the
Power of Attorney and the Custody Agreement, and the consummation
of the transactions herein and therein contemplated, will not
conflict with or result in a breach or violation of any terms or
provisions of, or constitute a default under, any statute, any
indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument known to such counsel to which such
Selling Shareholder is a party or by which such Selling
Shareholder is bound or to which any of the property or assets of
such Selling Shareholder is subject, nor will such action result
in any violation of the provisions of the organizational
documents of such Selling Shareholder if such Selling Shareholder
is a corporation or partnership, or any order, rule or regulation
known to such counsel of any court or governmental agency or body
having jurisdiction over such Selling Shareholder or the property
of such Selling Shareholder.
(iv) No consent, approval, authorization or order of any
court orgovernmental agency or body is required for the
consummation of the transactions contemplated by this Agreement
in connection with the Shares to be sold by such Selling
Shareholder hereunder, except such consents, approvals,
authorizations or orders as have been validly obtained and are in
full force and effect, such as have been obtained under the Act
and such as may be required under the state securities or blue
sky laws in connection with the purchase and distribution of such
Shares by the Underwriters.
(v) Such Selling Shareholder has full power and
authority to sell and deliver the Shares to be sold by such
Selling Shareholder hereunder.
(vi) Good and valid title to the Shares being sold by
such SellingShareholder, free and clear of any claims, liens,
encumbrances, security interests or other adverse claims, has
been transferred to each of the several Underwriters who have
purchased such Shares in good faith and without notice of any
such claim, lien, encumbrance, security interest or other adverse
claim within the meaning of the Uniform Commercial Code.
In rendering the opinions described above, counsel for each of
the Selling Shareholders may rely, as to matters of fact with respect
to such Selling Shareholder, upon the
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<PAGE>
representations of such Selling Shareholder contained in this
Agreement, the Power of Attorney and the Custody Agreement.
(f) The Representatives shall have received from Popham, Haik,
Schnobrich & Kaufman, Ltd., counsel for the Underwriters, an opinion
dated the Closing Date or the Option Closing Date, as the case may be,
with respect to the incorporation of the Company, the validity of the
Shares, the Registration Statement, the Prospectus, and other related
matters as the Representatives may reasonably request, and such
counsel shall have received such papers and information as they may
reasonably request to enable them to pass upon such matters.
(g) The Representatives shall have received on each of the date
hereof, the Closing Date and the Option Closing Date, as the case may
be, a signed letter, dated as of the date hereof, the Closing Date or
the Option Closing Date, as the case may be, in form and substance
satisfactory to the Representatives, from Deloitte and Touche LLP, to
the effect that they are independent public accountants with respect
to the Company and its subsidiaries within the meaning of the Act and
the related rules and regulations and containing statements and
information of the type ordinarily included in accountants "comfort
letters" to underwriters with respect to the financial statements and
certain financial information contained in the Registration Statement
and the Prospectus.
(h) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date or the Option Closing Date, as the case
may be, there shall not have been any change or any development
involving a prospective change in or affecting the general affairs,
management, financial position, shareholders equity or results of
operations of the Company and its subsidiaries, otherwise than as set
forth or contemplated in the Prospectus, the effect of which, in your
judgment, is material and adverse to the Company and makes it
impracticable or inadvisable to proceed with the public offering or
the delivery of the Shares being delivered at the Closing Date or the
Option Closing Date, as the case may be, on the terms and in the
manner contemplated in the Prospectus.
(i) The Representatives shall have received on the Closing Date
or the Option Closing Date, as the case may be, the opinion of both
Hugh Jaeger, Esq. and Burd, Bartz & Gutenkauf, patent counsel for the
Company, dated as of the Closing Date or the Option Closing Date, as
the case may be, and addressed to you, covering matters relating to
the patents and other intellectual property owned or licensed by the
Company to the effect that:
(i) Such counsel have no reason to believe that the
RegistrationStatement or the Prospectus contains any untrue
statement of a material fact, or omits to state any material fact
that is required to be stated therein or is necessary to make the
statements made therein not misleading, with respect to patents,
trade secrets, trademarks, service marks, copyrights or other
proprietary information or know-how owned or used by the Company,
or any allegation on the part of any person that the Company is
infringing any patent rights, trade secrets, trademarks, service
marks, copyrights or has misappropriated other proprietary
information or material of any such person.
(ii) To the best of such counsel's knowledge, the
statements in theRegistration Statement and the Prospectus under
the caption "Risk Factors-- Dependence on Patents, Patent
Applications, Licenses and Proprietary Rights" and
"Business--Patents, Patent Applications, Licenses and Proprietary
Rights" are accurate and complete statements or summaries of the
matters therein set froth, and nothing has
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<PAGE>
come to such counsel's attention that causes such counsel to
believe that such materialcontains any untrue statement of a
material fact, or omits to state a material fact that is required
to be stated therein or necessary in order to make the statements
made therein not misleading, in light of the circumstances under
which they were made.
(iii) To the best of such counsel's knowledge and also
based upon due inquiry of the Company, there are no pending legal
proceedings relating to patent rights, trade secrets, trademarks,
service marks, copyrights or other proprietary information or
know-how of the Company, and no such proceedings are threatened
or contemplated.
(iv) Although no search has been conducted, to the best
of such counsel's knowledge the Company is not infringing or
otherwise violating any patents, trade secrets, trademarks,
service marks, copyrights or other proprietary information or
know-how of any persons, and no person is infringing or otherwise
violating any of the Company's patents, trade secrets,
trademarks, service marks, copyrights or other proprietary
information or know-how of the Company in a way which could
materiallyaffect the use thereof by the Company.
(v) To the best of such counsel's knowledge, the Company
owns all patents, trade secrets, trademarks, service marks or
other proprietary information or know-how necessary to conduct
the business now being or proposed to be conducted by the Company
as described in the Prospectus.
(vi) The Company is listed in the records of the United
States Patent and Trademark Office ("PTO") as the sole assignee
of record of each of the patents listed on Schedule III to such
opinion (the "Patents") and each of the applications listed on
Schedule IV to such opinion (the "Applications"). To the best of
such counsel's knowledge, there are no asserted or unasserted
claims of any persons relating to the scope, or ownership of the
Patents or Applications, there are no liens which have been filed
against any of the Patents or Applications, there are no material
defects of form in the preparation or filing of the Applications,
the Applications are being diligently prosecuted, and none of the
Applications has been finally rejected or abandoned.
(vii) The Company is listed in the records of the
appropriate foreign patent offices as the sole assignee of record
of each of the foreign patents listed on Schedule V to such
opinion (the "Foreign Patents") and each of the foreign
applications listed on Schedule VI to such opinion (the "Foreign
Applications"). To the best of such counsel's knowledge, there
are no asserted or unasserted claims of anypersons relating to
the scope or ownership of the Foreign Patents or Foreign
Applications, there are no liens which have been filed against
any of the Foreign Patents or Foreign Applications, there are no
material defects of form in the preparation of filing of the
Foreign Applications, the Foreign Applications are being
diligently prosecuted, and none of the Foreign Applications has
been finally rejected or abandoned.
(viii) Such counsel has no reason to believe that the
Applications and Foreign Applications will not eventuate in
issued patents, or that any patents issued in respect of any such
Applications or Foreign Applications will not be valid or will
not afford the Company reasonable patent protection relative to
the subject matter thereof.
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<PAGE>
(ix) To the best of such counsel's knowledge, all
pertinent prior artreference known to counsel during the
prosecution of the Patents and Applications were disclosed to the
PTO, and to the best of counsel's information and belief neither
such counsel nor the Company, made any misrepresentation to, or
concealed any material fact from, the PTO during such
prosecution.
(x) To the best of such counsel's knowledge, the Company
takes security measures adequate to assert trade secret
protection in its non-patented technology where appropriate.
(xi) To the best of such counsel's knowledge,the
agreements executed by the Company's employees, consultants and
other advisors respecting trade secrets, confidentiality, or
intellectual property rights are valid, binding and enforceable
in accordance with their express terms.
(j) The Representatives shall have received on the Closing Date
or the Option Closing Date, as the case may be, a certificate or
certificates of the chief executive officer and the chief financial
officer of the Company to the effect that, as of the Closing Date or
theOption Closing Date, as the case may be, each of them severally
represents as follows:
(i) The Prospectus was filed with the Commission
pursuant to Rule424(b) within the applicable period prescribed
for such filing by the rules and regulations under the Act and in
accordance with Section 4 of this Agreement; no stop order
suspending the effectiveness of the Registration Statement has
been issued, and no proceedings for such purpose have been
initiated or are, to his knowledge, threatened by the Commission.
(ii) The representations and warranties of the Company
set forth inSection 1 of this Agreement are true and correct at
and as of the Closing Date or the Option Closing Date, as the
case may be, and the Company has performed all of its obligations
under this Agreement to be performed at or prior to the Closing
Date or the Option Closing Date, as the case may be.
(k) The Representatives shall have received on the Closing Date
or the Option Date, as the case may be, a certificate of the Selling
Shareholders pursuant to which the Selling Shareholders certify that
their representations and warranties set forth in this Agreement are
true and correct at and as of the Closing Date or the Option Date, as
the case may be, and that they have performed all of their obligations
under this Agreement to be performed at or prior to the Closing Date
or the Option Closing Date, as the case may be.
(l) The Representatives shall have received a written agreement
from each executive officer and director of the Company and the Possis
Marital Trust that for 90 days following the date of the Prospectus,
such person will not, without the Representatives' prior written
consent, sell, transfer or otherwise dispose of, his, her or its
Common Stock all as provided for in more detail in Section 1(a)(xvii)
hereof.
(m) The Shares shall have been approved for listing on The
Nasdaq National market.
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<PAGE>
(n) The Company and the Selling Shareholders shall have
furnished to the Representatives such further certificates and
documents as the Representatives may reasonably have requested.
The opinions and certificates mentioned in this Agreement shall be deemed
to be in compliance with the provisions hereof only if they are in all material
respects reasonably satisfactory to the Representatives and to Popham, Haik,
Schnobrich & Kaufman, Ltd., counsel for the Underwriters.
If any of the conditions hereinabove provided for in this Section 7 shall
not have been fulfilled when and as required by this Agreement to be fulfilled,
the obligations of the Underwriters hereunder may be terminated by the
Representatives by notifying the Company of such termination in writing or by
telegram at or prior to the Closing Date or the Option Closing Date, as the case
may be. In such event, the Company and the Underwriters shall not be under any
obligation to each other (except to the extent provided in Sections 6 and 8
hereof).
8. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless each
Underwriter, each officer and director thereof, and each person, if
any, who controls any Underwriter within the meaning of the Act,
against any losses, claims, damages or liabilities to which such
Underwriter or such persons may became subject under the Act or
otherwise, insofar as suchlosses, claims, damages or liabilities (or
actions or proceedings in respect thereof) arise out of or are based
upon (i) any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, any Preliminary
Prospectus or the Prospectus, including any amendments or supplements
thereto, (ii) the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make the
statements therein not misleading in light of the circumstances under
which they were made, or (iii) any act or failure to act or any
alleged act or failure to act by any Underwriter in connection with,
or relating in any manner to, the Common Stock or the offering
contemplated hereby, and which is included as part of or referred to
in any losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arising out of or based upon matters
covered by clause (i) or (ii) above, and will reimburse each
Underwriter and each such controlling person for any legal or other
expenses reasonably incurred by such Underwriter or such controlling
person in connection with investigating or defending any such action
or claim as such expenses are incurred; provided, however, that the
Company shall not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon
an untrue statement or alleged untrue statement, or omission or
alleged omission, made in the Registration Statement, any Preliminary
Prospectus or the Prospectus, including any amendments or supplements
thereto, in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through the
Representatives specifically for use therein; and, provided, further,
that the Company shall not be liable with respect to any Preliminary
Prospectus to the extent that any loss, claim, damage or liability of
such Underwriter results from the fact that such Underwriter sold
Shares to a person to whom there was not sent or given a copy of the
Prospectus if the Company had previously furnished copies thereof to
such Underwriter and the loss, claim, damage or liability of such
Underwriter results from an untrue statement or omission of a material
fact contained in the Preliminary Prospectus which was corrected in
the Prospectus; and provided, further, that the Company shall not be
liable in the case of any matter covered by clause (iii) above to the
extent that it is determined in a final judgment by a court of
competent jurisdiction that such losses, claims, damages or
liabilitiesresulted directly from any such acts or failures to act
undertaken or omitted to be taken by such Underwriter through its
gross negligence or willful misconduct.
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<PAGE>
(b) Each of the Selling Shareholders, severally in proportion to
the number of Shares to be sold by such Selling Shareholder hereunder,
agrees to indemnify and hold harmless each Underwriter, each officer
and director thereof, and each person, if any, who controls any
Underwriter within the meaning of the Act, against any losses, claims,
damages, orliabilities to which such Underwriter or such persons may
become subject under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the
Registration Statement, any Preliminary Prospectus or the Prospectus,
including any amendments or supplements thereto, or arise out of or
are based upon the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make the
statements therein not misleading in light of the circumstances under
which they were made, and will reimburse each Underwriter and each
such controlling person for any legal or other expenses reasonably
incurred by such Underwriter or such controlling person in connection
with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that the Selling
Shareholders shall not be liable in any such case to the extent that
any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement, or omission or
alleged omission, made in the Registration Statement, any Preliminary
Prospectus or the Prospectus, including any amendments or supplements
thereto, in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through the
Representativesspecifically for use therein; and, provided, further,
in no event shall any Selling Shareholder be liable for an amount in
excess of the net proceeds received by such Selling Shareholder from
the sale of the Shares.
(c) Each Underwriter agrees to indemnify and hold harmless the
Company, each of its directors, each of its officers who have signed
the Registration Statement, each Selling Shareholder and each person,
if any, who controls the Company or any Selling Shareholder within the
meaning of the Act, against any losses, claims, damages or liabilities
to which the Company or any such director, officer, Selling
Shareholder or controlling person may become subject under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material
fact contained in the Registration Statement, any Preliminary
Prospectus, the Prospectus or any amendment or supplement thereto, or
arise out of or are based upon the omission or the alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading in the light
of the circumstances under which they were made, and will reimburse
any legal or other expenses reasonably incurred by the Company or any
such director, officer, Selling Shareholder or controlling person in
connection with investigating or defending any such action or claim as
such expenses are incurred; provided, however, that each Underwriter
will be liable in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or
alleged omission has been made in the Registration Statement, any
Preliminary Prospectus, the Prospectus or any such amendment or
supplement in reliance upon and in conformity with written information
furnished to the Company by any Underwriter through the
Representatives specifically for use therein.
(d) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity or contribution may be sought pursuant to this Section
8, such person (the "indemnified party") shall promptly notify the
person against whom such indemnity may be sought (the "indemnifying
party") in writing. No indemnification provided for in Section 8(a),
(b) or (c) or contribution provided for in Section 8(e) shall be
available with respect to a proceeding to any party who shall fail to
give notice of
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<PAGE>
such proceeding as provided in this Section 8(d) if the party to whom
notice was not given was unaware of the proceeding to which such
notice would have related and was prejudiced by the failure to give
such notice, but the failure to give such notice shall not relieve the
indemnifying party or parties from any liability which it or they may
have to the indemnified party otherwise than on account of the
provisions of Section 8(a), (b), (c) or (d). In case any such
proceeding shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate therein and, to
the extent that it shall wish, jointly with any other indemnifying
party similarly notified, to assume the defense thereof, with counsel
reasonably satisfactory to such indemnified party and shall pay as
incurred the fees and disbursements of such counsel related to such
proceeding. In any such proceeding, any indemnified party shall have
the right to retain its own counsel at its own expense.
Notwithstanding the foregoing, the indemnifying party shall pay
promptly as incurred the reasonable fees and expenses of the counsel
retained by the indemnified party in the event (i) the indemnifying
party and the indemnified party shall have mutually agreed to the
retention of such counsel or (ii) the named parties to any such
proceeding (including anyimpleaded parties) include both the
indemnifying party and the indemnified party and the indemnified party
shall have reasonably concluded that there may be a conflict between
the positions of the indemnifying party and the indemnified party in
conducting the defense of any such action or that there may be legal
defenses available to it or other indemnified parties which are
different from or additional to those available to the indemnifying
party. It is understood that the indemnifying party shall not, in
connection with any proceeding or relatedproceedings in the same
jurisdiction, be liable for the fees and expenses of more than one
separate firm at any time for all such indemnified parties. Such firm
shall be designated in writing by the Representatives and shall be
reasonably satisfactory to the Company in the case of parties
indemnified pursuant to Section 8(a) or (b) and shall be designated in
writing by the Company and shall be reasonably satisfactory to the
Representatives in the case of parties indemnified pursuant to Section
8(c). The indemnifying party shall not be liable for any settlement
of any proceeding effected without its written consent but if settled
with such consent or if there be a final judgment for the plaintiff,
the indemnifying party agrees to indemnify the indemnified party from
and against any loss or liability by reason of such settlement or
judgment.
(e) If the indemnification provided for in this Section 8 is
unavailable or insufficient to hold harmless an indemnified party
under Section 8(a), (b) or (c) above in respect of any losses, claims,
damages or liabilities (or actions or proceedings in respect thereof)
referred to therein, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of
such losses, claims, damages or liabilities (or actions or proceedings
in respect thereof) in such proportion as is appropriate to reflect
the relative benefits received by the Company and the Selling
Shareholders on the one hand and the Underwriters on the other from
the offering of the Shares. If, however, the allocation provided by
the immediately preceding sentence is not permitted by applicable law,
then each indemnifying party shall contribute to such amount paid or
payable by such indemnified partyin such proportion as is appropriate
to reflect not only such relative benefits but also the relative fault
of the Company and the Selling Shareholders on the one hand and the
Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof), as well as
any other relevant equitable considerations. The relative benefits
received by the Company and the Selling Shareholders on the one hand
and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before
deducting expenses) received by the Company and the Selling
Shareholders bears to the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth
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<PAGE>
in the table on the cover page of the Prospectus. The relative fault
shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission
or alleged omission to state a material fact relates to information
suppliedby the Company and the Selling Shareholders on the one hand or
the Underwriters on the other and the parties relative intent,
knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company, the Selling Shareholders and
the Underwriters agree that it would not be just and equitable if
contributions pursuant to this Section 8(e) 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 which does not
take account of the equitable considerations referred to above in this
Section 8(e). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions or
proceedings in respect thereto) referred to above in this Section 8(e)
shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of
this Section 8(e), no Underwriter shall be required to contribute any
amount in excess of the underwriting discounts and commissions
applicable to the Shares purchased by such Underwriter; and 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 in this Section 8(e) to contribute are
several in proportion to their respective underwriting obligations and
not joint.
(f) The obligations of the Company and the Selling Shareholders
under this Section 8 shall be in addition to any liability which the
Company and the Selling Shareholders may otherwise have, and the
obligations of the Underwriters under this Section 8 shall be in
addition to any liability which the Underwriters may otherwise have.
9. DEFAULT BY UNDERWRITERS. If on the Closing Date or the Option Closing
Date, as the case may be, any Underwriter shall fail to purchase and pay for the
portion of the Shares which such Underwriter has agreed to purchase and pay for
on such date (otherwise than by reason of any default on the part of the Company
or a Selling Shareholder), you, as Representatives of the Underwriters, shall
use your best efforts to procure within 36 hours thereafter one or more of the
other Underwriters, or any others, to purchase from the Company and the Selling
Shareholders such amounts as may be agreed upon, and upon the terms set forth
herein, of the Firm Shares or Option Shares, as the case may be, which the
defaulting Underwriter or Underwriters failed to purchase. If during such 36
hours you, as Representatives, shall not have procured such other Underwriters,
or any others, to purchase the Firm Shares or Option Shares, as the case may be,
agreed to be purchased by the defaulting Underwriter or Underwriters, then
(a) if the aggregate number of Shares with respect to which such default shall
occur does not exceed 10% of the Firm Shares or Option Shares, as the case may
be, covered hereby, the other Underwriters shall be obligated, severally, in
proportion to the respective numbers of Firm Shares or Option Shares, as the
case may be, which they are obligated to purchase hereunder, to purchase the
Firm Shares or Option Shares, as the case may be, which such defaulting
Underwriter or Underwriters failed to purchase, or (b) if the aggregate number
of shares of Firm Shares or Option Shares, as the case may be, with respect to
which such default shall occur exceeds 10% of the Firm Shares or Option Shares,
as the case may be, covered hereby, the Company and the Selling Shareholders or
you as the Representatives of the Underwriters will have the right, by written
notice given within the next 36-hour period to the parties to this Agreement, to
terminate this Agreement without liability on the part of the non-defaulting
Underwriters or of the Company and the Selling Shareholders except for expenses
to be borne by the Company, the Selling Shareholders and the Underwriters as
provided in Section 6 hereof and the indemnity and contribution agreements in
Section 8 hereof. In the event of a default by any Underwriter or Underwriters,
as set forth in this Section 9, the Closing Date or Option Closing Date, as the
case may be, may be postponed for such period, not exceeding seven days, as you,
as Representatives, may determine in order that the required changes in the
Registration Statement or in the Prospectus or in any other documents or
arrangements may be effected. The
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<PAGE>
term "Underwriter" includes any person substituted for a defaulting Underwriter.
Any action taken under this Section 9 shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
10. NOTICES. All communications hereunder shall be in writing and, except
as otherwise provided herein, will be mailed, delivered or telegraphed and
confirmed as follows: if to the Underwriters, to Dain Bosworth Incorporated,
Dain Bosworth Plaza, 60 South Sixth Street, Minneapolis, Minnesota, Attention:
Brian J. Reagan, and John G. Kinnard and Company, Incorporated, Attention:
Michael Norton, with copies to D. William Kaufman, Esq., Popham, Haik,
Schnobrich & Kaufman, Ltd., 3300 Piper Jaffray Tower, 222 South Ninth Street,
Minneapolis, Minnesota 55402; if to the Company, to Possis Medical, Inc., 2905
Northwest Blvd., Minneapolis, Minnesota 55441-2644, Attention: Robert G.
Dutcher, with copies to David J. Lubben, Esq., Dorsey & Whitney, P.L.L.P., 220
South Sixth Street, Minneapolis, Minnesota 55402; and if to the Selling
Shareholders, to Robert G. Dutcher, 2905 Northwest Boulevard, Minneapolis,
Minnesota 55441-2644.
11. TERMINATION. This Agreement may be terminated by you by notice to the
Company and the Selling Shareholders as follows:
(a) at any time prior to the earlier of (i) the time the Shares
are released by you for sale by notice to the Underwriters or (ii)
4:00 p.m., Minneapolis time, on the first business day following the
later of the date on which the Registration Statement becomes
effective or the date of this Agreement;
(b) at any time prior to the Closing Date if any of the
following has occurred: (i) since the respective dates as of which
information is given in the Registration Statement and the Prospectus,
any material adverse change in or affecting the condition, financial
or otherwise, of the Company and its subsidiaries taken as a whole or
the business affairs,management, financial position, shareholders
equity or results of operations of the Company and its subsidiaries
taken as a whole, whether or not arising in the ordinary course of
business, (ii) any outbreak or escalation of hostilities or
declaration of war or national emergency after the date hereof or
other national or international calamity or crisis or change in
economic or political conditions if the effect of such outbreak,
escalation, declaration, emergency, calamity,crisis or change on the
financial markets of the United States would, in your judgment, make
the offering or delivery of the Shares impracticable or inadvisable,
(iii) suspension of trading in securities on the New York Stock
Exchange or the American Stock Exchange or limitation on prices (other
than limitations on hours or numbers of days of trading) for
securities on either such Exchange, or a halt or suspension of trading
in securities generally which are quoted on Nasdaq National Market
System, or (iv) declaration of a banking moratorium by either federal
or New York State authorities; or
(c) as provided in Sections 7 and 9 of this Agreement.
This Agreement also may be terminated by you, by notice to the Company, as
to any obligation of the Underwriters to purchase the Option Shares, upon the
occurrence at any time prior to the Option Closing Date of any of the events
described in subparagraph (b) above or as provided in Sections 6 and 8 of this
Agreement.
12. WRITTEN INFORMATION. For all purposes under this Agreement
(including, without limitation, Section 1, Section 2, Section 3 and Section 8
hereof), the Company and the Selling Shareholders understand and agree with each
of the Underwriters that the following constitutes the only written information
furnished to the Company by or through the Representatives specifically for use
in preparation of the Registration Statement, any Preliminary Prospectus, the
Prospectus, or any amendment or supplement thereto: (i) the per share "Price to
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<PAGE>
Public" and per share "Underwriting Discounts and Commissions" set forth on the
cover page of the Prospectus, (ii) the information relating to stabilization and
passive marketmaking set forth in the last two paragraphs on page two of the
Preliminary Prospectus and the Prospectus, and (iii) the information set forth
in paragraphs 1, 2, 4, 5, 6 and 8 under the caption "Underwriting" in the
Preliminary Prospectus and the Prospectus.
13. SUCCESSORS. This Agreement has been and is made solely for the
benefit of and shall be binding upon the Underwriters, the Company, the Selling
Shareholders and their respective successors, executors, administrators, heirs
and assigns, and the officers, directors and controlling persons referred to
herein, and no other person will have any right or obligation hereunder. The
term "successors" shall not include any purchaser of the Shares merely because
of such purchase.
14. MISCELLANEOUS. The reimbursement, indemnification and contribution
agreements contained in this Agreement and the representations, warranties and
covenants in this Agreement shall remain in full force and effect regardless of
(a) any termination of this Agreement, (b) any investigation made by or on
behalf of any Underwriter or controlling person thereof, or by or on behalf of
the Company or its directors or officers or the Selling Shareholders and (c)
delivery of and payment for the Shares under this Agreement.
Each provision of this Agreement shall be interpreted in such a manner as
to be effective and valid under applicable law, but if any provision of this
Agreement is held to be invalid, illegal or unenforceable under any applicable
law or rule in any jurisdiction, such provision will be ineffective only to the
extent of such invalidity, illegality or unenforceability in such jurisdiction
or any provision hereof in any other jurisdiction
This Agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of Minnesota.
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<PAGE>
If the foregoing letter is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company, the Selling
Shareholders and the several Underwriters in accordance with its terms.
Very truly yours,
POSSIS MEDICAL, INC.
By:
------------------------------------
Robert G. Dutcher
President
SELLING SHAREHOLDERS LISTED ON
SCHEDULE B
By:
-------------------------------------
Attorney-in-Fact
The foregoing Underwriting
Agreement is hereby confirmed
and accepted as of the date
first above written.
DAIN BOSWORTH INCORPORATED
JOHN G. KINNARD AND COMPANY, INCORPORATED
As Representatives of the several Underwriters
By Dain Bosworth Incorporated
By:
--------------------------------
Its:
-------------------------------
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<PAGE>
SCHEDULE A
Schedule of Underwriters
<TABLE>
<CAPTION>
Number of Firm Maximum Number
Underwriter Shares to be Purchased of Option Shares
----------- ---------------------- ----------------
<S> <C> <C>
Dain Bosworth Incorporated . . . . . . . . . . . . . .
John G. Kinnard and Company, Incorporated. . . . . . .
Total. . . . . . . . . . . . . . . . . . . . . . . . . 1,910,000 286,500
</TABLE>
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<PAGE>
SCHEDULE B
<TABLE>
<CAPTION>
Number of Maximum Number
Seller Firm Shares of Option Shares
------ ----------- ----------------
<S> <C> <C>
Possis Medical, Inc. . . . . . . . . . . . . . . . . . 1,750,000 286,500
Selling Shareholders:
The Possis Marital Trust . . . . . . . . . . . . . 125,000
Demetre M. Nicoloff, M.D.. . . . . . . . . . . . . 20,000
Seymour J. Mansfield . . . . . . . . . . . . . . . 10,000
Ann M. Possis. . . . . . . . . . . . . . . . . . . 5,000
Total. . . . . . . . . . . . . . . . . . . . . . . 1,910,000 286,500
</TABLE>
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