Exhibit 10.2
UroMed Corporation
6% Convertible Subordinated Notes due October 15, 2003
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Purchase Agreement
October 8, 1996
Xxxxxxx, Xxxxx & Co.
PaineWebber Incorporated
X.X. Xxxxxx Securities Inc.
c/o Goldman, Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
UroMed Corporation, a Massachusetts corporation (the "Company"), proposes,
subject to the terms and conditions stated herein, to issue and sell to the
Purchasers named in Schedule I hereto (the "Purchasers") an aggregate of
$60,000,000 principal amount of the Convertible Subordinated Notes, convertible
into Common Stock, no par value ("Stock"), of the Company, specified above (the
"Firm Securities") and, at the election of the Purchasers, up to $9,000,000
additional aggregate principal amount of Convertible Subordinated Notes,
convertible into Stock, of the Company (the "Optional Securities") (the Firm
Securities and the Optional Securities which the Purchasers elect to purchase
pursuant to Section 2 hereof are herein collectively called the "Securities").
As used in Sections 2 and 8 hereof, the term "Purchasers" shall be deemed to
include Xxxxxxx Sachs International ("GSI"), which is acting as Xxxxxxx, Xxxxx &
Co.'s selling agent in making certain resales of the securities pursuant to
Section 3 hereof.
The Purchasers and other holders (including subsequent transferees) of
Securities (and any holders of shares of Stock which are issued upon conversion
of such Securities from time to time) will be entitled to the benefits of the
registration rights agreement, to be dated as of the First Time of Delivery (as
defined below) (the "Registration Rights Agreement"), among the Company and the
Purchasers, in the form attached hereto as Exhibit A.
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1. The Company represents and warrants to, and agrees with, each of
the Purchasers that:
(a) A preliminary offering circular, dated September 27, 1996 (the
"Preliminary Offering Circular"), and an offering circular, dated October
8, 1996 (the "Offering Circular"), have been prepared in connection with
the offering of the Securities and shares of the Stock issuable upon
conversion thereof. Any reference to the "Exchange Act Reports" shall be
deemed to refer to and include the Company's most recent Annual Report on
Form 10-K and all subsequent documents filed by the Company with the
United States Securities and Exchange Commission (the "Commission")
pursuant to Section 13(a), 13(c) or 15(d) of the United States Securities
Exchange Act of 1934, as amended (the "Exchange Act") prior to the latest
Time of Delivery (as defined below). The Exchange Act Reports, when they
were or are filed with the Commission, conformed or will conform in all
material respects to the applicable requirements of the Exchange Act and
the applicable rules and regulations of the Commission thereunder. The
Preliminary Offering Circular or the Offering Circular and any amendments
or supplements thereto, the Exchange Act Reports and any Additional Issuer
Information (as defined in Section 5(f)) did not and will not, as of their
respective dates, contain an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by a
Purchaser through Xxxxxxx, Sachs & Co. expressly for use therein;
(b) The Company has not sustained since the date of the latest
audited financial statements included in the Offering Circular any
material loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Offering Circular; and, since the
respective dates as of which information is given in the Offering
Circular, except for stock option grants and exercises pursuant to the
Company's existing stock option plan and share purchases pursuant to the
Company's existing employee stock purchase plan, there has not been any
change in the capital stock or long-term debt of the Company or any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs, management,
financial position, stockholders" equity or results of operations of the
Company, otherwise than as set forth or contemplated in the Offering
Circular;
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(c) The Company has good and marketable title in fee simple to all
real property and good and marketable title to all personal property owned
by it, in each case free and clear of all liens, encumbrances and defects
except such as are described in the Offering Circular or such as do not
materially affect the value of such property and do not interfere in any
material respect with the use made and proposed to be made of such
property by the Company; and any real property and buildings held under
lease by the Company are held by it under valid, subsisting and
enforceable leases with such exceptions as are not material and do not
interfere in any material respect with the use made and proposed to be
made of such property and buildings by the Company;
(d) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the Commonwealth of
Massachusetts, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Offering Circular,
and has been duly qualified as a foreign corporation for the transaction
of business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification, or is subject to no material
liability or disability by reason of the failure to be so qualified in any
such jurisdiction;
(e) The Company does not, directly or indirectly, have any
subsidiaries or own 5% or more of the stock or other equity interest in
any corporation, firm, partnership, joint venture, association or other
entity.
(f) The Company has an authorized capitalization as set forth in the
Offering Circular, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued and are fully
paid and non-assessable; the shares of Stock initially issuable upon
conversion of the Securities have been duly and validly authorized and
reserved for issuance and, when issued and delivered in accordance with
the provisions of the Securities and the Indenture referred to below, will
be new shares not previously issued, will be duly and validly issued,
fully paid and non-assessable and will conform to the description of the
Stock contained in the Offering Circular;
(g) The Securities have been duly authorized and, when issued and
delivered pursuant to this Agreement, will have been duly executed,
authenticated, issued and delivered, will constitute valid and legally
binding obligations of the Company entitled to the benefits provided by
the indenture to be dated as of October 15, 1996 (the "Indenture") between
the Company and State Street Bank and Trust Company, as Trustee (the
"Trustee"), under which they are to be issued, which will be substantially
in the form previously delivered to you, and will be enforceable in
accordance with their terms,
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subject, as to enforcement, to bankruptcy, insolvency, reorganization and
other laws of general applicability relating to or affecting creditors"
rights and to general equity principles; the Indenture has been duly
authorized and, when executed and delivered by the Company and the
Trustee, the Indenture will constitute a valid and legally binding
instrument, enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws of
general applicability relating to or affecting creditors" rights and to
general equity principles; and the Securities and the Indenture will
conform to the descriptions thereof in the Offering Circular and will be
in substantially the form previously delivered to you;
(h) None of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale of
the Securities) will violate or result in a violation of Section 7 of the
Exchange Act, or any regulation promulgated thereunder, including, without
limitation, Regulations G, T, U, and X of the Board of Governors of the
Federal Reserve System;
(i) Prior to the date hereof, neither the Company nor any of its
affiliates has taken any action which is designed to or which has
constituted or which might have been expected to cause or result in
stabilization or manipulation of the price of any security of the Company
in connection with the offering of the Securities;
(j) The issue and sale of the Securities, the issue and delivery of
shares of Stock upon conversion of the Securities and the compliance by
the Company with all of the provisions of the Securities, the Indenture,
the Registration Rights Agreement and this Agreement and the consummation
of the transactions herein and therein contemplated will not conflict with
or result in a breach or violation of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the Company is a
party or by which the Company is bound or to which any of the property or
assets of the Company is subject, nor will such action result in any
violation of the provisions of the Articles of Incorporation or By-laws of
the Company or any statute or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over the Company or any
of its properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the issue and sale of the Securities, the
issue and delivery of shares of Stock upon conversion of the Securities or
the consummation by the Company of the transactions contemplated by this
Agreement, the Indenture or the Registration Rights Agreement, except for
the filing of a registration statement by the Company with the Commission
pursuant to the United States
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Securities Act of 1933, as amended (the "Securities Act"), for the
registration of the Securities and the Stock initially issuable upon
conversion thereof as contemplated by the Registration Rights Agreement,
the qualification of the Indenture under the United States Trust Indenture
Act of 1939, as amended (the "Trust Indenture Act"), as contemplated by
the Registration Rights Agreement, and such consents, approvals,
authorizations, registrations or qualifications as may be required under
state securities or Blue Sky laws (i in connection with the purchase and
distribution of the Securities by the Purchasers or (ii) as contemplated
by the Registration Rights Agreement;
(k) The Registration Rights Agreement has been duly authorized and
prior to the Closing will be duly executed and delivered by the Company
and upon such execution and delivery will constitute the valid and binding
instrument of the Company enforceable against the Company in accordance
with its terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors" rights and to general equity principles and subject
to any limitations imposed by public policy on the indemnification and
contribution provisions of the Registration Rights Agreement;
(l) The Company is not in violation of its Certificate of
Incorporation or By-laws or in default in the performance or observance of
any obligation, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or
instrument to which it is a party or by which it or any of its properties
may be bound except for any such defaults that individually or in the
aggregate would not have or cause a material adverse effect on the
business, financial position, stockholders" equity or results of
operations of the Company (a "Material Adverse Effect");
(m) To the knowledge of the Company, except as set forth in the
Offering Circular: (i) the Company owns or has the right to use, free and
clear of all liens, charges, claims, encumbrances, pledges, security
interests, defects, or other like restrictions of any kind whatsoever, all
Intellectual Property (as defined below) used in the conduct of its
business in the manner and to the full extent currently conducted and
proposed to be conducted as described in the Offering Circular, without
infringing upon or otherwise acting adversely to the right or claimed
right of any person or entity under or with respect in and to any of such
Intellectual Property; (ii) the Company is not obligated or under any
liability whatsoever to make any material payments by way of royalties,
fees or otherwise to any owner or licensee of, or other claimant to, such
Intellectual Property with respect to the use thereof or in connection
with the conduct of its business in the manner and to the full extent as
currently conducted and proposed to be conducted as described in the
Offering Circular; (iii) there is no infringement by third parties of any
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such Intellectual Property, except that the Company is aware that a
competitor of the Company is developing an expandable remove-to-void
urethral plug but has insufficient information to determine whether such
competitor's plug would infringe any such Intellectual Property; (iv)
there is no pending or threatened action, suit, proceeding or claim by
others challenging the Company's rights in or to such Intellectual
Property, and the Company is unaware of any facts which would form a
reasonable basis for any such claim; (v) there is no pending or threatened
action, suit, proceeding or claim by others challenging the validity or
scope of such Intellectual Property, and the Company is unaware of any
facts which would form a reasonable basis for any such claim; (vi) there
is no pending or threatened action, suit, proceeding or claim by others
that the Company infringes or otherwise violates any Intellectual Property
of others and the Company is unaware of any facts which would form a
reasonable basis for any such claim; (vii) there is no patent or patent
application of others which contains claims that dominate or may dominate
any Intellectual Property described in the Offering Circular as being
owned by the Company and that is necessary for the conduct of its business
in the manner and to the extent currently conducted and proposed to be
conducted as described in the Offering Circular or that interferes with
the issued or pending claims of any such Intellectual Property; and (viii)
in connection with filing the Company's United States patent applications,
the Company disclosed all pertinent prior art references, and other facts
and information known to it, to the U.S. Patent and Trademark Office in
such applications and all information submitted to the U.S. Patent and
Trademark Office in the relevant applications was accurate and complete;
"Intellectual Property" means all patents, patent applications,
trademarks, trademark applications, service marks, trade names,
copyrights, trade secrets, know how (including all unpatented or
unpatentable proprietary or confidential information, systems or
procedures), technology, inventions, designs, processes, methods,
technical data and information or other intangible asset or any license or
other right to use any of the foregoing;
(n) Except as described in the Offering Circular, the Company has
all licenses, certificates, permits, consents, orders, approvals and
authorizations from U.S. and foreign governmental authorities, including,
without limitation, the United States Food and Drug Administration (the
"FDA") and any agency of any foreign government exercising comparable
authority (including any non-governmental entity whose approval or
authorization is required under foreign law comparable to that
administered by the FDA) in a jurisdiction where the Company's products
are, or, as described in the Offering Circular, are proposed to be, sold
(collectively, "Permits"), which are necessary to own its properties
and/or to conduct its business in the manner and to the extent now
conducted or proposed to be conducted as described in the Offering
Circular, with no material restrictions or
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qualifications except as disclosed in the Offering Circular, and such
Permits are in full force and effect and no proceeding has been instituted
or is pending or, to the best knowledge of the Company, is contemplated or
threatened which in any manner affects or draws into question the validity
or effectiveness thereof; the Company is not in violation of any statutes,
orders, rules or regulations relating to or affecting the properties or
Permits of the Company or the operation of the Company's business in the
manner and to the extent now conducted or proposed to be conducted as
described in the Offering Circular and is not in violation of any Permit
except for any violations that individually or in the aggregate would not
have or cause a Material Adverse Effect; and the Company has not received,
and has no knowledge of any facts that furnish any reasonable basis for,
any Notice of Adverse Findings, Regulatory Letters, Section 305 notices,
or other similar communications, alerts or seizures requested or
threatened relating to the Company's products.
(o) The statements set forth in the Offering Circular under the
caption "Description of Notes" and "Description of Common Stock", insofar
as they purport to constitute a summary of the terms of the Indenture, the
Securities, the Stock and the Registration Rights Agreement and under the
captions "United States Taxation" and "Underwriting", insofar as they
purport to describe the provisions of the laws and documents referred to
therein, are accurate in all material respects and fairly present the
information set forth therein;
(p) Other than as set forth in the Offering Circular, there are no
legal or governmental proceedings pending to which the Company is a party
or of which any property of the Company is the subject which, if
determined adversely to the Company, would individually or in the
aggregate have a material adverse effect on the current or future
financial position, stockholders" equity or results of operations of the
Company; and, to the best of the Company's knowledge, no such proceedings
are threatened or contemplated by governmental authorities or threatened
by others;
(q) When the Securities are issued and delivered pursuant to this
Agreement, the Securities will not be of the same class (within the
meaning of Rule 144A under the Securities Act) as securities which are
listed on a national securities exchange registered under Section 6 of the
Exchange Act or quoted in a U.S. automated inter-dealer quotation system;
(r) The Company is subject to Section 13 or 15(d) of the
Exchange Act;
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(s) The Company is not, and after giving effect to the offering and
sale of the Securities, will not be an "investment company", or an entity
"controlled" by an "investment company", as such terms are defined in the
United States Investment Company Act of 1940, as amended (the "Investment
Company Act");
(t) Neither the Company nor any person acting on its behalf has
offered or sold the Securities (or any Stock issuable on conversion
thereof) by means of any general solicitation or general advertising
within the meaning of Rule 502(c) under the Securities Act or, with
respect to Securities (or any such Stock) sold outside the United States
to non-U.S. persons (as defined in Rule 902 under the Securities Act), by
means of any directed selling efforts within the meaning of Rule 902 under
the Securities Act and the Company, any affiliate of the Company and any
person acting on its or their behalf has complied with and will implement
the offering restriction requirements of Rule 902 under the Securities
Act;
(u) Within the preceding six months, neither the Company nor any
other person acting on behalf of the Company has offered or sold to any
person any Securities or Stock, or any securities of the same or a similar
class as the Securities or the Stock, other than Securities offered or
sold to the Purchasers hereunder, Stock sold pursuant to an effective
registration statement under the Securities Act and Stock issued in
connection with the ASI acquisition as described in the Offering Circular.
The Company will take reasonable precautions designed to insure that any
offer or sale, direct or indirect, in the United States or to any U.S.
person (as defined in Rule 902 under the Securities Act) of any Securities
or Stock or any substantially similar security issued by the Company,
within six months subsequent to the date on which the distribution of the
Securities has been completed (as notified to the Company by Xxxxxxx,
Sachs & Co.), is made under restrictions and other circumstances
reasonably designed not to affect the status of the offer and sale of the
Securities and the Stock issuable upon conversion thereof in the United
States and to U.S. persons contemplated by this Agreement as transactions
exempt from the registration provisions of the Securities Act;
(v) Neither the Company nor any of its affiliates does business with
the government of Cuba or with any person or affiliate located in Cuba
within the meaning of Section 517.075, Florida Statutes; and
(w) Price Waterhouse LLP who have certified certain financial
statements of the Company are independent public accountants as required
by the Securities Act and the rules and regulations of the Commission
thereunder.
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2. Subject to the terms and conditions herein set forth, (a) the Company
agrees to issue and sell to each of the Purchasers, and each of the Purchasers
agrees, severally and not jointly, to purchase from the Company, at a purchase
price of 96.5% of the principal amount thereof, plus accrued interest, if any,
from October 15, 1996 to the Time of Delivery hereunder, the principal amount of
Securities set forth opposite the name of such Purchaser in Schedule I hereto
and (b) in the event and to the extent that Xxxxxxx, Xxxxx & Co. on behalf of
the Purchasers shall exercise the election to purchase Optional Securities as
provided below, the Company agrees to issue and sell to each of the Purchasers,
and each of the Purchasers agrees, severally and not jointly, to purchase from
the Company, at the same purchase price set forth in clause (a) of this Section
2, that portion of the aggregate principal amount of the Optional Securities as
to which such election shall have been exercised (to be adjusted by you so as to
eliminate fractions of $1,000) determined by multiplying such aggregate
principal amount of Optional Securities by a fraction, the numerator of which is
the maximum aggregate principal amount of Optional Securities which such
Purchaser is entitled to purchase as set forth opposite the name of such
Purchaser in Schedule I hereto and the denominator of which is the maximum
aggregate principal amount of Optional Securities which all of the Purchasers
are entitled to purchase hereunder.
The Company hereby grants to the Purchasers the right to purchase at their
election up to $9,000,000 aggregate principal amount of Optional Securities, at
the purchase price set forth in clause (a) of the first paragraph of this
Section 2, for the sole purpose of covering over allotments in the sale of Firm
Securities. Any such election to purchase Optional Securities may be exercised
by written notice from you to the Company, given within a period of 30 calendar
days after the date of this Agreement, setting forth the aggregate principal
amount of Optional Securities to be purchased and the date on which such
Optional Securities are to be delivered, as determined by you but in no event
earlier than the First Time of Delivery (as defined in Section 4 hereof) or,
unless you and the Company otherwise agree in writing, earlier than two or later
than ten business days after the date of such notice.
3. Upon the authorization by you of the release of the Securities, the
several Purchasers propose to offer the Securities for sale upon the terms and
conditions set forth in this Agreement and the Offering Circular and each
Purchaser hereby represents and warrants to, and agrees with the Company that:
(a) It will offer and sell the Securities and the Stock issuable on
conversion thereof only to persons who it reasonably believes are "qualified
institutional buyers" ("QIBs") within the meaning of Rule 144A under the Act in
transactions meeting the requirements of Rule 144A, provided that Xxxxxxx, Sachs
& Co. may also offer and sell Securities, (i) subject to an initial minimum
purchase obligation of $100,000, to institutions that it reasonably believes are
"accredited
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investors" within the meaning of Rule 501 (a)(1), (2), (3) or (7) under
the Securities Act ("Institutional Accredited Investors") or 60 upon the
terms and conditions set forth in Annex I to this Agreement;
(b) It is an Institutional Accredited Investor; and
(c) It will not offer or sell the Securities or the Stock issuable upon
conversion thereof by any form of general solicitation or general advertising,
including but not limited to the methods described in Rule 502(c) under the
Securities Act, and it will comply with the provisions of Paragraphs (3) and (4)
of Annex I to this Agreement.
4. (a) Except as set forth in the next paragraph, the Securities to be
purchased by each Purchaser hereunder will be represented (i) in the case of
Securities to be initially resold pursuant to Rule 144A under the Securities
Act, by one or more definitive global Securities in book-entry form which will
be deposited by or on behalf of the Company with The Depository Trust Company
("DTC") or its designated custodian and (ii) in the case of Securities to be
initially resold pursuant to Regulation S under the Securities Act, by one or
more definitive global Securities in book-entry form which will be deposited by
or on behalf of the Company with DTC or its designated custodian for the benefit
of Xxxxxx Guaranty Trust Company of New York (Brussels office), as operator of
the Euroclear System, or Cedel Bank, Societe Anonyme, or both, for credit to the
account of GSI, unless otherwise directed by GSI. The Company will deliver the
Securities to Xxxxxxx, Sachs & Co., for the account of each Purchaser, against
payment by or on behalf of such Purchaser of the purchase price therefor by
certified or official bank check or checks, or by wire transfer, payable to the
order of the Company in Federal (same day) funds, by causing DTC to credit the
Securities to the account of Xxxxxxx, Xxxxx & Co. (or, if and to the extent
requested by Xxxxxxx, Sachs & Co., GSI) at DTC. The Company will cause the
certificates representing the Securities to be made available to Xxxxxxx, Xxxxx
& Co. for checking at least twenty-four hours prior to the Time of Delivery (as
defined below) with respect thereto at the office of DTC or its designated
custodian (the "Designated Office"). The time and date of such delivery and
payment shall be, with respect to the Firm Securities, 9:30 a.m., New York City
time, on October 15, 1996, or such other time and date as Xxxxxxx, Sachs & Co.
and the Company may agree upon in writing and, with respect to the Optional
Securities, 9:30 a.m., Now York City time, on the date specified by Xxxxxxx,
Xxxxx & Co. in the written notice given by Xxxxxxx, Sachs & Co. of the
Purchasers" election to purchase such Optional Securities, or such other time
and date as Xxxxxxx, Xxxxx & Co. and the Company may agree upon in writing. Such
time and date for delivery of the Firm Securities is herein called the "First
Time of Delivery", such time and date for delivery of the Optional Securities,
if not the First Time of Delivery, is herein called the "Second Time of
Delivery", and each such time and date for delivery is herein called a "Time of
Delivery".
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Such Securities, if any, as Xxxxxxx, Sachs & Co. may request upon at least
forty-eight hours" prior notice to the Company (such request to include the
authorized denominations and the names in which they are to be registered),
shall be delivered in definitive certificated form, by or on behalf of the
Company to Xxxxxxx, Xxxxx & Co., against payment by or on behalf of such
Purchaser of the purchase price therefor by certified or official bank check or
checks, or by wire transfer, payable to the order of the Company in Federal
(same day) funds. The Company will cause the certificates representing the
Securities to be made available for checking and packaging at least twenty-four
hours prior to the Time of Delivery with respect thereto at the office of
Xxxxxxx, Sachs & Co., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "New York
Office").
(b) The documents to be delivered at each Time of Delivery by or on behalf
of the parties hereto pursuant to Section 7 hereof, including the cross-receipt
for the Securities and any additional documents requested by the Purchasers
pursuant to Section 76) hereof, will be delivered at such time and date at the
offices of Xxxxxxxx & Xxxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the
"Closing Location"), and the Securities will be delivered at the Designated
Office and, if applicable, the New York Office, all at such Time of Delivery. A
meeting will be held at the Closing Location at 2:00 p.m., New York City time,
on the New York Business Day next preceding each Time of Delivery, at which
meeting the final drafts of the documents to be delivered pursuant to the
preceding sentence will be available for review by the parties hereto. For the
purposes of this Section 4, "New York Business Day" shall mean each Monday,
Tuesday, Wednesday, Thursday and Friday which is not a day on which banking
institutions in New York are generally authorized or obligated by law or
executive order to close.
5. The Company agrees with each of the Purchasers:
(a) To prepare the Offering Circular in a form approved by you; to make no
amendment or any supplement to the Offering Circular which shall be disapproved
by you promptly after reasonable notice thereof; and to furnish you with copies
thereof;
(b) Promptly from time to time to take such action as you may reasonably
request to qualify the Securities and the shares of Stock issuable upon
conversion of the Securities for offering and sale under the securities laws of
such jurisdictions as you may request and to comply with such laws so as to
permit the continuance of sales and dealings therein in such jurisdictions for
as long as may be necessary to complete the distribution of the Securities,
provided that in connection therewith 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;
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(c) To furnish the Purchasers with four copies of the Offering Circular
and each amendment or supplement thereto signed by an authorized officer of the
Company with the independent accountants" report(s) in the Offering Circular,
and any amendment or supplement containing amendments to the financial
statements covered by such report(s), signed by the accountants, and additional
copies thereof in such quantities as you may from time to time reasonably
request, and if, at any time prior to the earlier of (i) the time the Purchasers
have sold all the Securities purchased hereunder as notified to the Company by
Xxxxxxx, Sachs & Co. and (ii) the expiration of nine months after the date of
the Offering Circular, any event shall have occurred as a result of which the
Offering Circular 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 the light of the circumstances under
which they were made when such Offering Circular is delivered, not misleading,
or, if for any other reason it shall be necessary or desirable during such same
period to amend or supplement the Offering Circular, to notify you and upon your
request to prepare and furnish without charge to each Purchaser and to any
dealer in securities as many copies as you may from time to time reasonably
request of an amended Offering Circular or a supplement to the Offering Circular
which will correct such statement or omission or effect such compliance;
(d) During the period beginning from the date hereof and continuing until
the date 90 days after the date hereof, not to offer, sell, contract to sell or
otherwise dispose of, except as provided hereunder, any Stock or other
securities of the Company that are substantially similar to the Securities or
the Stock or any securities that are convertible into or exchangeable for, or
that represent the right to receive, Stock or substantially similar securities
(other than pursuant to employee stock option and stock purchase plans existing
on, or upon the conversion or exchange of convertible or exchangeable securities
outstanding as of, the date of this Agreement), without the prior written
consent of Xxxxxxx, Xxxxx & Co.;
(e) Not to be or become, at any time prior to the expiration of three
years after the Time of Delivery, an open-end investment company, unit
investment trust, closed-end investment company or face-amount certificate
company that is or is required to be registered under Section 8 of the
Investment Company Act;
(f) At any time when the Company is not subject to Section 13 or 15(d) of
the Exchange Act, for the benefit of holders from time to time of Securities and
Stock issuable upon conversion thereof, to furnish at its expense, upon request,
to holders of Securities and the Stock issuable upon conversion thereof and
prospective purchasers of Securities and the Stock issuable upon conversion
thereof information (the "Additional Issuer Information") satisfying the
requirements of subsection (d)(4)(i) of Rule 144A under the Securities Act;
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(g) To use its best efforts to cause the Securities to be eligible for the
PORTAL trading system of the National Association of Securities Dealers, Inc.:
(h) To file with the Commission, not later than 15 days after the First
Time of Delivery, five copies of a notice on Form D under the Securities Act
(one of which will be manually signed by a person duly authorized by the
Company); to otherwise comply with the requirements of Rule 503 under the
Securities Act; and to furnish promptly to you evidence of each such required
timely filing (including a copy thereof);
(i) To furnish to the holders of the Securities as soon as practicable
after the end of each fiscal year an annual report (including a balance sheet
and statements of income, stockholders" equity and cash flows of the Company and
its consolidated subsidiaries certified by independent public accountants),
which requirement will be satisfied by the furnishing of the Company's Annual
Report on Form 10-K (or any applicable successor thereto under the Exchange
Act), and, as soon as practicable after the end of each of the first three
quarters of each fiscal year (beginning with the fiscal quarter ending after the
date of the Offering Circular), consolidated summary financial information of
the Company and its subsidiaries for such quarter in reasonable detail, which
requirement will be satisfied by the furnishing of the Company's Quarterly
Report on Form 10-Q (or any applicable successor thereto under the Exchange
Act);
(j) During a period of five years from the date of the Offering Circular,
to furnish to you copies of all reports or other communications (financial or
other) furnished to stockholders of the Company and to deliver to you as soon as
they are available, copies of any reports and financial statements furnished to
or filed with the Commission or any securities exchange on which the Securities
or any class of securities of the Company is listed (such financial statements
to be on a consolidated basis to the extent the accounts of the Company and its
subsidiaries are consolidated in reports furnished to its stockholders generally
or to the Commission); and during a period of one year from the date of the
Offering Circular, to furnish to you such additional information concerning the
business and financial condition of the Company as you may from time to time
reasonably request;
(k) During the period continuing until three years after the latest Time
of Delivery, the Company will not, and will use reasonable best efforts to not
permit any of its "affiliates" (as defined in Rule 144 under the Securities Act)
to, resell (i) any of the Securities which constitute "restricted securities"
under Rule 144 or (ii) any shares of Stock unto which any of the Securities have
been converted which constitute "restricted securities" under Rule 144, that in
either case have been reacquired by any of them;
-14-
(l) To use the net proceeds received by it from the sale of the Securities
pursuant to this Agreement in the manner specified in the Offering Circular
under the caption "Use of Proceeds"; and
(m) To reserve and keep available at all times, free of preemptive rights,
shares of Stock for the purpose of enabling the Company to satisfy any
obligations to issue new shares of its Stock upon conversion of the Securities.
6. The Company covenants and agrees with the several Purchasers that the
Company will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of the Company's counsel and accountants in connection with the
issue of the Securities and the shares of Stock issuable upon conversion of the
Securities and all other expenses in connection with the preparation and
printing of the Preliminary Offering Circular and the Offering Circular and any
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Purchasers and dealers; (ii) the cost of printing or producing
any Agreement among Purchasers, this Agreement, the Indenture, the Registration
Rights Agreement, the Blue Sky and Legal Investment Memoranda and any other
documents in connection with the offering, purchase, sale and delivery of the
Securities, provided, however, that the Company shall not be required to pay
more than $5,000 for the document production expenses of Xxxxxxxx & Xxxxxxxx;
(iii) all expenses in connection with the qualification of the Securities and
the shares of Stock issuable upon conversion of the Securities for offering and
sale under state securities laws as provided in Section 5(b) hereof, including
the reasonable fees and disbursements of counsel for the Purchasers in
connection with such qualification and in connection with the Blue Sky and legal
investment surveys; (iv) any fees charged by securities rating services for
rating the Securities; M the cost of preparing the Securities and shares of
Stock issuable upon conversion thereof, as the case may be; (vi) the fees and
expenses of the Trustee and any agent of the Trustee and the reasonable fees and
disbursements of counsel for the Trustee in connection with the Indenture and
the Securities; (vii) fees and expenses of any transfer or conversion agent or
registrar for the Securities or the Stock issuable upon conversion thereof, as
the case may be; (viii) any cost incurred in connection with the designation of
the Securities for trading in PORTAL and (ix) all other costs and expenses
incident to the performance of its obligations hereunder which are not otherwise
specifically provided for in this Section. It is understood, however, that,
except as provided in this Section, and Sections 8 and 11 hereof, the Purchasers
will pay all of their own costs and expenses, including the fees of their
counsel, transfer taxes on resale of any of the Securities by them, and any
advertising expenses connected with any offers they may make.
7. The obligations of the Purchasers hereunder at each Time of Delivery
shall be subject to the condition that all representations and warranties and
other statements of the Company herein are, at and as of such Time of Delivery,
true and
-15-
correct, the condition that the Company shall have performed all of its
obligations hereunder theretofore to be performed, and the following additional
conditions:
(a) Xxxxxxxx & Xxxxxxxx, counsel for the Purchasers, shall have furnished
to you such opinion or opinions, dated such Time of Delivery, with respect to
the incorporation of the Company, the validity of the Indenture, the Securities
and the shares of stock issuable upon conversion of the Securities, this
Agreement and the Registration Rights Agreement, the Offering Circular and the
offering of the Securities as well as such other related matters as you 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;
(b) Xxxxxxx, Xxxx & Xxxxx, LLP, counsel for the Company, shall have
furnished to you their written opinion, dated such Time of Delivery, in the form
of Exhibit B hereto;
(c) Fish & Xxxxxxxxxx P.C., patent counsel for the Company, shall have
furnished to you their written opinion, dated such Time of Delivery, in form and
substance satisfactory to you, to the effect that:
(i) The statements contained in the Offering Circular under the
captions "Risk Factors-Uncertainty Regarding Patents and Protection of
Proprietary Technology" and "Business-Patents and Proprietary Rights",
insofar as they relate to or constitute a summary of provisions of
statutes, regulations, contracts and agreements, patents, patent
applications or other matters of U.S. patent or trademark law, are
accurate in all material respects and fairly present the information set
forth therein; and
(ii) To the knowledge of such counsel, except as set forth in the
Offering Circular: (A) the Company owns or has the right to use, free and
clear of all liens, charges, claims, encumbrances, pledges, security
interests, defects, or other like restrictions of any kind whatsoever, all
Intellectual Property used in the conduct of its business in the manner
and to the extent currently conducted and proposed to be conducted as
described in the Offering Circular, without infringing upon or otherwise
acting adversely to the right or claimed right of any person or entity
under or with respect in and to any of such Intellectual Property; (B) the
Company is not obligated or under any liability to make any material
payments by way of royalties, fees or otherwise to any owner or licensee
of, or other claimant to, such Intellectual Property with respect to the
use thereof or in connection with the conduct of its business in the
manner and to the extent currently conducted and proposed to be conducted
as described in the Offering Circular; (C) such counsel is not aware of
any infringement by third parties of any such Intellectual Property,
except that such counsel is aware that a competitor of the Company is
-16-
developing an expandable remove-to-void urethral plug but has insufficient
information to determine whether such competitor's plug would infringe any
such Intellectual Property; (D) such counsel is not aware of any pending
or threatened action, suit, proceeding or claim by others challenging the
Company's rights in or to such Intellectual Property, and such counsel is
not aware of any facts which would form a reasonable basis for any such
claim; (E) such counsel is not aware of any pending or threatened action,
suit, proceeding or claim by others challenging the validity or scope of
the patents constituting a part of such Intellectual Property, and such
counsel is not aware of any facts which would form a reasonable basis for
any such claim; (F) such counsel is not aware of any pending or threatened
action, suit, proceeding or claim by others that the Company infringes or
otherwise violates any Intellectual Property of others, and such counsel
is not aware of any facts which would form a reasonable basis for any such
claim; and (G) such counsel is not aware of any patent or patent
application of others which contains claims that dominate or may dominate
any Intellectual Property described in the Offering Circular as being
owned by the Company and that is necessary for the conduct of its business
in the manner and to the extent currently conducted and proposed to be
conducted as described in the Offering Circular or that interferes with
the issued or pending claims of any such Intellectual Property;
(d) On the date of the Offering Circular prior to the execution of this
Agreement and also at each Time of Delivery, Price Waterhouse, LLP shall have
furnished to you a letter or letters, dated the respective dates of delivery
thereof, in form and substance satisfactory to you, to the effect set forth in
Annex II hereto;
(e) (i) The Company shall not have sustained since the date of the latest
audited financial statements included in the Offering Circular any loss or
interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set forth or
contemplated in the Offering Circular, and (ii) since the respective dates as of
which information is given in the Offering Circular, except for stock option
grants and exercises pursuant to the Company's employee stock purchase plan
existing at the date of this Agreement and share purchases pursuant to the
Company's employee stock purchase plan existing at the date of this Agreement,
there shall not hate been any change in the capital stock or long-term debt of
the Company or any change, or any development involving a prospective change, in
or affecting the general affairs, management, financial position, stockholders"
equity or results of operations of the Company, otherwise than as set forth or
contemplated in the Offering Circular, the effect of which, in any such case
described in Clause (i) or (ii), is in the judgment of the Purchasers so
material and adverse as to make it impracticable or inadvisable to proceed with
the offering
-17-
or the delivery of the Securities on the terms and in the manner contemplated in
this Agreement and in the Offering Circular;
(f) On or after the date hereof (i) no downgrading shall have occurred in
the rating accorded the Company's debt securities by any "nationally recognized
statistical rating organization", as that term is defined by the Commission for
purposes of Rule 436(g)(2) under the Securities Act, and (ii) no such
organization shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of the Company's
debt securities;
(g) On or after the date hereof there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally on the New York Stock Exchange; or on the NASDAQ National Market; (ii)
a suspension or material limitation in trading in the Company's securities on
the NASDAQ National Market; (iii) a general moratorium on commercial banking
activities declared by either Federal or New York State authorities; (iv) the
outbreak or escalation of hostilities involving the United States or the
declaration by the United States of a national emergency or war, if the effect
of any such event specified in this Clause (iv) in the judgment of the
Purchasers makes it impracticable or inadvisable to proceed with the offering or
the delivery of the Securities on the terms and in the manner contemplated in
the Offering Circular or (v) the occurrence of any material adverse change in
the existing, financial, political or economic conditions in the United States
or elsewhere which, in the judgment of the Purchasers, would materially and
adversely affect the financial markets or the markets for the Securities, the
Stock or other debt or equity securities;
(h) The Securities shall have been designated for trading on PORTAL;
and
(i) The Company shall have furnished or caused to be furnished to you at
such Time of Delivery certificates of officers of the Company satisfactory to
you as to the accuracy of the representations and warranties of the Company
herein at and as of such Time of Delivery, as to the performance by the Company
of all of its obligations hereunder to be performed at or prior to such Time of
Delivery, as to the matters set forth in subsections (a) and (e) of this Section
and as to such other matters as you may reasonably request.
8. (a) The Company will indemnify and hold harmless each Purchaser against
any losses, claims, damages or liabilities, joint or several, to which such
Purchaser may become subject, under the Securities Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged untrue statement
of a material fact contained in any Preliminary Offering Circular or the
Offering Circular, or any amendment or supplement thereto, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
necessary to make the statements
-18-
therein not misleading, and will reimburse each Purchaser for any legal or other
expenses reasonably incurred by such Purchaser 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 any Preliminary Offering Circular or the Offering Circular or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by any Purchaser through Xxxxxxx, Xxxxx &
Co. expressly for use therein. Any amounts advanced by the Company to an
indemnified party pursuant to this Section 8(a) as a result of such losses shall
be returned to the Company if it shall be finally determined by such a court in
a judgment not subject to appeal or final review that such indemnified party was
not entitled to indemnification by the Company.
(b) Each Purchaser will indemnify and hold harmless the Company against
any losses, claims, damages or liabilities to which the Company may become
subject, under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Offering Circular or the Offering Circular, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact or necessary to make the
statements therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in any Preliminary Offering Circular or the Offering
Circular or any such amendment or supplement in reliance upon and in conformity
with written information furnished to the Company by such Purchaser through
Xxxxxxx, Sachs & Co. expressly for use therein; and will reimburse the Company
for any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending any such action or claim as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action 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 satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
-19-
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the written consent
of the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party
to such action or claim) unless such settlement, compromise or judgment (i)
includes an unconditional release of the indemnified party from all liability
arising out of such action or claim and (ii) does not include a statement as to,
or an admission of, fault, culpability or a failure to act, by or on behalf of
any indemnified party.
(d) If the indemnification provided for in this Section 8 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to therein although applicable in accordance with
its terms, 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 in respect thereof) in such proportion as is appropriate
to reflect the relative benefits received by the Company on the one hand and the
Purchasers on the other from the offering of the Securities. 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 party in such proportion as is appropriate
to reflect not only such relative benefits but also the relative fault of the
Company on the one hand and the Purchasers on the other in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Purchasers 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 bear to the total underwriting discounts and
commissions received by the Purchasers, in each case as set forth in the
Offering Circular. 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 supplied by the Company on the one hand or the Purchasers on the
other and the parties" relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
the Purchasers agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by pro rate allocation (even if
the Purchasers 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 subsection (d) The amount paid or payable by an
-20-
indemnified party as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subsection (d) 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 subsection (d), no Purchaser
shall be required to contribute any amount in excess of the amount by which the
total price at which the Securities underwritten by it and distributed to
investors were offered to investors exceeds the amount of any damages which such
Purchaser has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. The Purchaser's obligations in
this subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Purchaser within the meaning of the Securities Act; and the obligations of the
Purchasers under this Section 8 shall be in addition to any liability which the
respective Purchasers may otherwise have and shall extend, upon the same terms
and conditions, to each officer and director of the Company and to each person,
if any, who controls the Company within the meaning of the Securities Act.
9. (a) If any Purchaser shall default in its obligation to purchase the
Securities which it has agreed to purchase hereunder, you may in your discretion
arrange for you or another party or other parties to purchase such Securities on
the terms contained herein. If within thirty-six hours after such default by any
Purchaser you do not arrange for the purchase of such Securities, then the
Company shall be entitled to a further period of thirty-six hours within which
to procure another party or other parties satisfactory to you to purchase such
Securities on such terms. In the event that, within the respective prescribed
periods, you notify the Company that you have so arranged for the purchase of
such Securities, or the Company notifies you that it has so arranged for the
purchase of such Securities, you or the Company shall have the right to postpone
the Time of Delivery for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Offering Circular,
or in any other documents or arrangements, and the Company agrees to prepare
promptly any amendments to the Offering Circular which in your opinion may
thereby be made necessary. The term "Purchaser" as used in this Agreement shall
include any person substituted under this Section with like effect as if such
person had originally been a party to this Agreement with respect to such
Securities.
(b) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Purchaser or Purchasers by you and the Company as
provided in subsection (a) above, the aggregate principal
-21-
amount of such Securities which remains unpurchased does not exceed one-eleventh
of the aggregate principal amount of all the Securities, then the Company shall
have the right to require each non-defaulting Purchaser to purchase the
principal amount of Securities which such Purchaser agreed to purchase hereunder
and, in addition, to require each non-defaulting Purchaser to purchase its pro
rate share (based on the principal amount of Securities which such Purchaser
agreed to purchase hereunder) of the Securities of such defaulting Purchaser or
Purchasers for which such arrangements have not been made; but nothing herein
shall relieve a defaulting Purchaser from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Securities of a defaulting Purchaser or Purchasers by you and the Company as
provided in subsection (a) above, the aggregate principal amount of Securities
which remains unpurchased exceeds one-eleventh of the aggregate principal amount
of all the Securities, or if the Company shall not exercise the right described
in subsection (b) above to require non-defaulting Purchasers to purchase
Securities of a defaulting Purchaser or Purchasers, then this Agreement shall
thereupon terminate, without liability on the part of any non-defaulting
Purchaser or the Company, except for the expenses to be borne by the Company and
the Purchasers as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Purchaser from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Purchasers, as set forth in
this Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Purchaser or any controlling person of any Purchaser, or the Company, or
any officer or director or controlling person of the Company, and shall survive
delivery of and payment for the Securities.
11. If this Agreement shall be terminated pursuant to either (a) clause
(i), (iii), (iv) or (v) of Section 7(g) hereof or (b) Section 9 hereof, the
Company shall not then be under any liability to any Purchaser except as
provided in Sections 6 and 8 hereof; but, if for any other reason, the
Securities are not delivered by or on behalf of the Company as provided herein,
the Company will reimburse the Purchasers through you for all out-of-pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Purchasers in making preparations for the
purchase, sale and delivery of the Securities, but the Company shall then be
under no further liability to any Purchaser except as provided in Sections 6 and
8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Purchasers, and the parties hereto shall be entitled to act and rely upon any
statement,
-22-
request, notice or agreement on behalf of any Purchaser made or given by you
jointly or by Xxxxxxx, Xxxxx & Co. on your behalf.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Purchasers shall be delivered or sent by mail, telex or
facsimile transmission to you in care of Xxxxxxx, Sachs & Co., 00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Registration Department; and if to the
Company shall be delivered or sent by mail, telex or facsimile transmission to
the address of the Company set forth in the Offering Circular, Attention:
President and Chief Executive Officer; provided, however, that any notice to a
Purchaser pursuant to Section 8(c) hereof shall be delivered or sent by mail,
telex or facsimile transmission to such Purchaser at its address set forth in
its Purchasers" Questionnaire, or telex constituting such Questionnaire, which
address will be supplied to the Company by you upon request. Any such
statements, requests, notices or agreements shall take effect upon receipt
thereof.
13. This Agreement shall be binding upon, and inure solely to the benefit
of, the Purchasers, the Company and, to the extent provided in Sections 8 and 10
hereof, the officers and directors of the Company, GSI and each person who
controls the Company, any Purchaser or GSI, and their respective heirs,
executors, administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement. No Purchaser of
any of the Securities from any Purchaser shall be deemed a successor or assign
by reason merely of such purchase.
14. Time shall be of the essence of this Agreement.
15. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such respective counterparts shall together constitute one and
the same instrument.
If the foregoing is in accordance with your understanding, please sign and
return to us six counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Purchasers, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Purchasers and the Company.
It is understood that your acceptance of this letter on behalf of each of the
Purchasers is pursuant to the authority set forth in a form of Agreement among
Purchasers, the form of which shall be submitted to the Company for examination
upon request, but without warranty on your part as to the authority of the
signers thereof.
-23-
Very truly yours,
UroMed Corporation
By:.________________________________
Name:
Title:
Accepted as of the date hereof:
Xxxxxxx, Xxxxx & Co.
PaineWebber Incorporated
X.X. Xxxxxx Securities Inc.
By: Xxxxxxx, Xxxxx & Co.
---------------------------------
(Xxxxxxx, Sachs & Co.)
-24-
SCHEDULE I
Aggregate Principal
Principal Amount Amount of Optional
of Firm Securities to be
Securities to Purchased if
be Purchased Maximum Option
Purchaser Exercised
----------------------------------- ------------------ ------------------
Xxxxxxx, Xxxxx & Co.............. $40,002,000 $6,000,300
PaineWebber Incorporated......... 13,332,000 1,999,800
X.X. Xxxxxx Securities Inc....... 6,666,000 999,900
------------------ ------------------
Total................. $60,000,000 $9,000,000
A-1
ANNEX I
(1) The Securities and the Stock issuable upon the conversion thereof have
not been registered under the Securities Act and may not be offered or sold
within the United States or to, or for the account or benefit of, U.S. persons
except in accordance with Regulation S under the Securities Act or pursuant to
an exemption from the registration requirements of the Securities Act. Xxxxxxx,
Xxxxx & Co. represent that they have offered and sold the Securities and Stock
issuable upon the conversion thereof, and will offer and sell the Securities and
the Stock issuable upon the conversion thereof, (i) as part of their
distribution at any time and 00 otherwise until 40 days after the later of the
commencement of the offering and the latest Time of Delivery, in each case (i)
and (ii), only through GSI, as their selling agent, in accordance with Rule 903
of Regulation S. Accordingly, Xxxxxxx, Sachs & Co. agree that neither they,
their affiliates nor any persons acting on their behalf has engaged or will
engage in any directed selling efforts with respect to the Securities or the
Stock issuable upon the conversion thereof, and it and they have complied and
will comply with the offering restrictions requirement of Regulation X. Xxxxxxx,
Xxxxx & Co. agree that, at or prior to confirmation of sale of Securities or
Stock issuable upon conversion thereof, they or GSI will have sent to each
distributor, dealer or person receiving a selling concession, fee or other
remuneration that purchases Securities or any such Stock from it during the
restricted period a confirmation or notice to substantially the following
effect:
"The Securities covered hereby and the Stock issuable upon conversion
thereof have not been registered under the U.S. Securities Act of 1933
(the "Securities Act") and may not be offered and sold within the United
States or to, or for the account or benefit of, U.S. persons (i) as part
of their distribution at any time or (ii) otherwise until 40 days after
the later of the commencement of the offering and the issue date with
respect to additional Securities, if any, issued to cover over-allotments,
except in either case in accordance with Regulation S (or Rule 144A if
available) under the Securities Act. Terms used above have the meaning
given to them by Regulation S."
Terms used in this paragraph have the meanings given to them by Regulation
X.
Xxxxxxx, Sachs & Co. further agree that they and GSI have not entered and
will not enter into any contractual arrangement with respect to the distribution
or delivery of the Securities, except with their affiliates or with the prior
written consent of the Company.
(2) Notwithstanding the foregoing, Securities and Stock issuable upon
conversion thereof may be offered, sold and delivered by Xxxxxxx, Xxxxx & Co.
A-2-
pursuant to clause (a) of Section 3 of this Agreement without delivery of the
written statement required by paragraph (1) above.
(3) Each Purchaser represents and agrees that (i) it (and, in the case of
Xxxxxxx, Sachs & Co., GSI) has not offered or sold and prior to the date six
months after the date of issue of the Securities will not offer or sell any
Securities to persons in the United Kingdom except to persons whose ordinary
activities involve them in acquiring, holding, managing or disposing of
investments (as principal or agent) for the purposes of their businesses or
otherwise in circumstances which have not resulted and will not result in an
offer to the public in the United Kingdom within the meaning of the Public
Offers of Securities Regulations 1995, (ii) it (and, in the case of Xxxxxxx,
Xxxxx & Co., GSI has complied, and will comply, with all applicable provisions
of the Financial Services Xxx 0000 of Great Britain with respect to anything
done by it in relation to the Securities in, from or otherwise involving the
United Kingdom, and (iii) it (and, in the case of Xxxxxxx, Sachs & Co., GSI has
only issued or passed on, and will only issue or pass on, in the United Kingdom,
any document received by it in connection with the issuance of the Securities to
a person who is of a kind described in Article 11(3) of the Financial Services
Xxx 0000 (Investment Advertisements) (Exemptions) Order 1996 of Great Britain or
is a person to whom the document may otherwise lawfully be issued or passed on.
(4) Each Purchaser agrees that it (and, in the case of Xxxxxxx, Xxxxx &
Co., GSI) will not offer, sell or deliver any of the Securities in any
jurisdiction outside the United States except under circumstances that will
result in compliance with the applicable laws thereof, and that it (and, in the
case of Xxxxxxx, Sachs & Co., GSI) will take at its own expense whatever action
is required to permit its purchase and resale of the Securities in such
jurisdictions. Each Purchaser understands that no action has been taken to
permit a public offering in any jurisdiction outside the United States where
action would be required for such purpose. Each Purchaser agrees not to cause
any advertisement of the Securities to be published in any newspaper or
periodical or posted in any public place and not to issue any circular relating
to the Securities except in any such case at its own risk and expense.
ANNEX II
Pursuant to Section 7(e) of the Purchase Agreement, the accountants shall
furnish letters to the Purchasers to the effect that:
(i) They are independent certified public accountants with respect
to the Company and its subsidiaries within the meaning of the Securities
Exchange Act of 1934 (the "Exchange Act") and the applicable published
rules and regulations thereunder;
(ii) In their opinion, the financial statements and financial
statement schedules audited by them and included in the Offering Circular
comply as to form in all material respects with the applicable
requirements of the Exchange Act and the related published rules and
regulations;
(iii) The unaudited selected financial information with respect to
the results of operations and financial position of the Company for the
five most recent fiscal years included in the Offering Circular agrees
with the corresponding amounts (after restatements where applicable) in
the audited financial statements for such five fiscal years;
(iv) On the basis of limited procedures not constituting an audit in
accordance with generally accepted auditing standards, consisting of a
reading of the unaudited financial statements and other information
referred to below, a reading of the latest available interim financial
statements of the Company and its subsidiaries, inspection of the minute
books of the Company and its subsidiaries since the date of the latest
audited financial statements included in the Offering Circular, inquiries
of officials of the Company and its subsidiaries responsible for financial
and accounting matters and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention that caused them
to believe that:
(A) the unaudited statements of operations, balance sheets and
statements of cash flows included in the Offering Circular are not
in conformity with generally accepted accounting principles applied
on the basis substantially consistent with the basis for the audited
statements of operations, balance sheets and statements of cash
flows included in the Offering Circular;
(B) as of a specified date not more than five days prior to
the date of such letter, there have been any changes in the
consolidated capital stock (other than issuances of capital stock
upon exercise of options and stock appreciation rights, upon
earnouts of performance shares and upon conversions of convertible
securities, in each case
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which were outstanding on the date of the latest financial
statements included in the Offering Circular) or any increase in the
long-term debt of the Company and its subsidiaries, or any decreases
in net current assets or stockholders" equity or other items
specified by the Purchasers, or any increases in any items specified
by the Purchasers, in each case as compared with amounts shown in
the latest balance sheet included in the Offering Circular except in
each case for changes, increases or decreases which the Offering
Circular discloses have occurred or may occur or which are described
in such letter; and
(C) for the period from the date of the latest financial
statements included in the Offering Circular to the specified date
referred to in Clause (B) there were any decreases in net revenues
or operating profit or the total or per share amounts of net income
or other items specified by the Purchasers, or any increases in any
items specified by the Representatives, in each case as compared
with the comparable period of the preceding year and with any other
period of corresponding length specified by the Purchasers, except
in each case for decreases or increases which the Offering Circular
discloses have occurred or may occur or which are described in such
letter; and
(v) In addition to the examination referred to in their report(s)
included in the Offering Circular and the limited procedures, inspection
of minute books, inquiries and other procedures referred to in paragraphs
(iii) and (iv) above, they have carried out certain specified procedures,
not constituting an audit in accordance with generally accepted auditing
standards, with respect to certain amounts, percentages and financial
information specified by the Purchasers, which are derived from the
general accounting records of the Company and its subsidiaries, which
appear in the Offering Circular, and have compared certain of such
amounts, percentages and financial information with the accounting records
of the Company and its subsidiaries and have found them to be in
agreement.
